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                                                                   Exhibit 10.17

                           R.H. DONNELLEY CORPORATION

                       2001 STOCK AWARD AND INCENTIVE PLAN






            Approved and adopted by the Board of Directors on February 27, 2001,
                         Approved and adopted by shareholders on May 1, 2001 and
            Amended and Restated by the Board of Directors effective May 1, 2001
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                           R.H. DONNELLEY CORPORATION

                       2001 STOCK AWARD AND INCENTIVE PLAN
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1.             Purpose.................................................................................      1


2.             Definitions.............................................................................      1


3.             Administration..........................................................................      4


4.             Stock Subject to Plan...................................................................      5


5.             Eligibility; Per-Person Award Limitations ..............................................      5


6.             Specific Terms of Awards................................................................      6


7.             Performance Awards, Including Annual Incentive Awards..................................       9


8.             Non-Employee Director Awards............................................................     12


9.             Certain Provisions Applicable to Awards.................................................     19


10.            Change in Control.......................................................................     20


11.            Additional Award Forfeiture Provisions..................................................     22


12.            General Provisions......................................................................     24
</TABLE>
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                           R.H. DONNELLEY CORPORATION

                       2001 STOCK AWARD AND INCENTIVE PLAN

         1. PURPOSE. The purpose of this 2001 Stock Award and Incentive Plan
(the "Plan") is to aid R.H. Donnelley Corporation, a Delaware corporation
(together with its successors and assigns, the "Company"), in attracting,
retaining, motivating and rewarding employees and non-employee directors of the
Company or its subsidiaries or affiliates, to provide for equitable and
competitive compensation opportunities, to recognize individual contributions
and reward achievement of Company goals, and promote the creation of long-term
value for stockholders by closely aligning the interests of Participants with
those of stockholders. The Plan authorizes stock-based and cash-based incentives
for Participants.

         2. DEFINITIONS. In addition to the terms defined in Section 1 above and
elsewhere in the Plan, the following capitalized terms used in the Plan have the
respective meanings set forth in this Section:

                  (a) "Annual Incentive Award" means a type of Performance Award
         granted to a Participant under Section 7(c) representing a conditional
         right to receive cash, Stock or other Awards or payments, as determined
         by the Committee, based on performance in a performance period of one
         fiscal year or a portion thereof.

                  (b) "Annual Limit" shall have the meaning specified in Section
         5(b).

                  (c) "Award" means any Option, SAR, Restricted Stock, Deferred
         Stock, Stock granted as a bonus or in lieu of another award, Dividend
         Equivalent, Other Stock-Based Award, Performance Award or Annual
         Incentive Award, together with any related right or interest, granted
         to a Participant under the Plan.

                  (d) "Beneficiary" means the legal representatives of the
         Participant's estate entitled by will or the laws of descent and
         distribution to receive the benefits under a Participant's Award upon a
         Participant's death, provided that, if and to the extent authorized by
         the Committee, a Participant may be permitted to designate a
         Beneficiary, in which case the "Beneficiary" instead will be the
         person, persons, trust or trusts (if any are then surviving) which have
         been designated by the Participant in his or her most recent written
         and duly filed beneficiary designation to receive the benefits
         specified under the Participant's Award upon such Participant's death.
         Unless otherwise determined by the Committee, any designation of a
         Beneficiary other than a Participant's spouse shall be subject to the
         written consent of such spouse.

                  (e) "Board" means the Company's Board of Directors.

                  (f) "Cause" shall have the meaning defined in any employment
         agreement or severance agreement between the Participant and the
         Company or a subsidiary or affiliate then in effect or, if no such
         agreement is then in effect, "Cause" shall mean (i) the Participant's
         willful and continued failure substantially to perform the duties of
         his or her position after notice and opportunity to cure; (ii) any
         willful act or omission by the Participant constituting dishonesty,
         fraud or other malfeasance, which in any such case is demonstrably
         injurious to the financial condition or business reputation of the
         Company or any of its subsidiaries or affiliates; or (iii) a felony
         conviction in a court of law under the laws of the United States or any
         state thereof or any other jurisdiction in which the Company or a
         subsidiary or affiliate conducts business which materially impairs the
         value of the Participant's service to the Company or any of its
         subsidiaries or affiliates; provided, however, that for purposes of
         this definition, no act or failure to act shall be deemed "willful"
         unless effected by the Participant not in good faith and without a
         reasonable belief that such action or failure to act was in or not
         opposed to the Company's best interests, and no act or failure to act
         shall be deemed "willful" if it results from any incapacity of the
         Participant due to physical or mental illness.
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                  (g) "Change in Control" and related terms have the meanings
         specified in Section 10.

                  (h) "Code" means the Internal Revenue Code of 1986, as
         amended. References to any provision of the Code or regulation
         (including a proposed regulation) thereunder shall include any
         successor provisions and regulations.

                  (i) "Committee" means a committee of two or more directors
         designated by the Board to administer the Plan; provided, however,
         that, directors appointed or serving as members of a Board committee
         designated as the Committee shall not be employees of the Company or
         any subsidiary or affiliate. In appointing members of the Committee,
         the Board will consider whether a member is or will be a Qualified
         Member, but such members are not required to be Qualified Members at
         the time of appointment or during their term of service on the
         Committee. The full Board may perform any function of the Committee
         hereunder, in which case the term "Committee" shall refer to the Board.

                  (j) "Covered Employee" means an Eligible Person who is a
         Covered Employee as specified in Section 12(j).

                  (k) "Deferral Account" means the account established and
         maintained by the Company for Deferred Stock and/or deferred cash
         credited under Section 8. A Deferral Account shall include one or more
         subaccounts, including a Deferred Stock Account for forfeitable
         Deferred Stock under Section 8(c), a Deferred Stock Account for shares
         of Deferred Stock that have become nonforfeitable under Section 8(c) or
         that are at all times nonforfeitable under Section 8(e)(iii), a
         Deferred Stock Account for Deferred Stock resulting from Option
         exercises under Section 8(f)(i), and a Deferred Cash Account described
         in Section 8(e)(iv). The Deferral Account and subaccounts, and Deferred
         Stock and deferred cash credited thereto, will be maintained solely as
         bookkeeping entries by the Company to evidence unfunded obligations of
         the Company.

                  (l) "Deferred Stock" means a right, granted under this Plan,
         to receive Stock or other Awards or a combination thereof at the end of
         a specified deferral period.

                  (m) "Disability" means, with respect to a non-employee
         director, termination of service as a director of the Company due to a
         physical or mental incapacity of long duration which renders the
         Participant unable to perform the duties of a director of the Company.

                  (n) "Dividend Equivalent" means a right, granted under this
         Plan, to receive cash, Stock, other Awards or other property equal in
         value to all or a specified portion of the dividends paid with respect
         to a specified number of shares of Stock.

                  (o) "Effective Date" means the effective date specified in
         Section 12(p).

                  (p) "Eligible Person" has the meaning specified in Section 5.

                  (q) "Exchange Act" means the Securities Exchange Act of 1934,
         as amended. References to any provision of the Exchange Act or rule
         (including a proposed rule) thereunder shall include any successor
         provisions and rules.

                  (r) "Fair Market Value" means the fair market value of Stock,
         Awards or other property as determined by the Committee or under
         procedures established by the Committee. Unless otherwise determined by
         the Committee, the Fair Market Value of Stock shall be the average of
         the high and low sales prices per share of Stock reported on a
         consolidated basis for securities listed on the


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         principal stock exchange or market on which Stock is traded on the day
         immediately preceding the day as of which such value is being
         determined or, if there is no sale on that day, then on the last
         previous day on which a sale was reported.

                  (s) "Incentive Stock Option" or "ISO" means any Option
         designated as an incentive stock option within the meaning of Code
         Section 422 and qualifying thereunder.

                  (t) "Option" means a right, granted under this Plan, to
         purchase Stock.

                  (u) "Option Valuation Methodology" means the method for
         determining the number of shares to be subject to Options, and the
         exercise price thereof, granted in payment of Retainer Fees under
         Section 8(e)(ii).

                  (v) "Other Director Compensation" means fees payable to a
         director in his or her capacity as such, other than Retainer Fees, for
         attending meetings and other service on the Board and Board committees
         or otherwise.

                  (w) "Other Stock-Based Awards" means Awards granted to a
         Participant under Section 6(h).

                  (x) "Participant" means a person who has been granted an Award
         under the Plan which remains outstanding, including a person who is no
         longer an Eligible Person.

                  (y) "Performance Award" means a conditional right, granted to
         a Participant under Sections 6(i) and 7, to receive cash, Stock or
         other Awards or payments.

                  (z) "Plan Year" means, with respect to a non-employee
         director, the period commencing at the time of election of the director
         at an annual meeting of shareholders (or the election of a class of
         directors if the Company then has a classified Board of Directors), or
         the director's initial appointment to the Board if not at an annual
         meeting of shareholders, and continuing until the close of business of
         the day preceding the next annual meeting of shareholders; provided,
         however, that the initial Plan Year shall begin on the day of the
         Company's 2001 Annual Meeting of Stockholders.

                  (aa) "Preexisting Plans" means each of the following Company
         plans: the 1991 Key Employees' Stock Option Plan, as amended and
         restated; the Key Employees' Performance Unit Plan, as amended and
         restated; the 1998 Directors' Stock Plan, as amended and restated; and
         the Annual Incentive Plan, as amended and restated.

                  (bb) "Qualified Member" means a member of the Committee who is
         a "Non-Employee Director" within the meaning of Rule 16b-3(b)(3) and an
         "outside director" within the meaning of Regulation 1.162-27 under Code
         Section 162(m).

                  (cc) "Restricted Stock" means Stock granted under this Plan
         which is subject to certain restrictions and to a risk of forfeiture.

                  (dd) "Retainer Fees" means annual Board and chair retainer
         fees payable to a director in his or her capacity as such for service
         on the Board and Board committees.

                  (ee) "Retirement" means, with respect to a non-employee
         director, termination of service as a director of the Company at or
         after age 65.

                  (ff) "Rule 16b-3" means Rule 16b-3, as from time to time in
         effect and applicable to Participants, promulgated by the Securities
         and Exchange Commission under Section 16 of the Exchange Act.

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                  (gg) "Stock" means the Company's Common Stock, par value $1.00
         per share, and any other equity securities of the Company that may be
         substituted or resubstituted for Stock pursuant to Section 12(c).

                  (hh) "Stock Appreciation Rights" or "SAR" means a right
         granted to a Participant under Section 6(c).

                  (ii) "Valuation Date" shall mean the close of business on the
         last business day of each calendar quarter and, in the case of any
         final distribution from a Participant's Deferred Cash Account
         (described in Section 8(f)(iv)), the day preceding such distribution.

3.       ADMINISTRATION.

                  (a) Authority of the Committee. The Plan shall be administered
         by the Committee, which shall have full and final authority, in each
         case subject to and consistent with the provisions of the Plan, to
         select Eligible Persons to become Participants; to grant Awards; to
         determine the type and number of Awards, the dates on which Awards may
         be exercised and on which the risk of forfeiture or deferral period
         relating to Awards shall lapse or terminate, the acceleration of any
         such dates, the expiration date of any Award, 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, Stock, other Awards, or other
         property, and other terms and conditions of, and all other matters
         relating to, Awards; to prescribe documents evidencing or setting terms
         of Awards (such Award documents need not be identical for each
         Participant), amendments thereto, and rules and regulations for the
         administration of the Plan and amendments thereto; to construe and
         interpret the Plan and Award documents and correct defects, supply
         omissions or reconcile inconsistencies therein; and to make all other
         decisions and determinations as the Committee may deem necessary or
         advisable for the administration of the Plan. Decisions of the
         Committee with respect to the administration and interpretation of the
         Plan shall be final, conclusive, and binding upon all persons
         interested in the Plan, including Participants, Beneficiaries,
         transferees under Section 12(b) and other persons claiming rights from
         or through a Participant, and stockholders. The foregoing
         notwithstanding, the Board shall perform the functions of the Committee
         for purposes of granting Awards under the Plan to non-employee
         directors (the functions of the Committee with respect to other aspects
         of non-employee director awards is not exclusive to the Board,
         however).

                  (b) Manner of Exercise of Committee Authority. The express
         grant of any specific power to the Committee, and the taking of any
         action by the Committee, shall not be construed as limiting any power
         or authority of the Committee. The Committee may delegate to officers
         or managers of the Company or any subsidiary or affiliate, or
         committees thereof, the authority, subject to such terms as the
         Committee shall determine, to perform such functions, including
         administrative functions, as the Committee may determine, to the extent
         (x) that such delegation will not result in the loss of an exemption
         under Rule 16b-3(d) for Awards granted to Participants subject to
         Section 16 of the Exchange Act in respect of the Company and will not
         cause Awards intended to qualify as "performance-based compensation"
         under Code Section 162(m) to fail to so qualify, and (y) permitted by
         the Delaware General Corporation Law.

                  (c) Limitation of Liability. The Committee and each member
         thereof, and any person acting pursuant to authority delegated by the
         Committee, shall be entitled, in good faith, to rely or act upon any
         report or other information furnished by any executive officer, other
         officer or employee of the Company or a subsidiary or affiliate, the
         Company's independent auditors, consultants or any other agents
         assisting in the administration of the Plan. Members of the Committee,
         any person acting pursuant to authority delegated by the Committee, and
         any officer or employee of the Company or a subsidiary or affiliate
         acting at the direction or on behalf of the Committee or a delegee
         shall not be


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         personally liable for any action or determination taken or made in good
         faith with respect to the Plan, and shall, to the extent permitted by
         law, be fully indemnified and protected by the Company with respect to
         any such action or determination.

4.       STOCK SUBJECT TO PLAN.

                  (a) Overall Number of Shares Available for Delivery. Subject
         to adjustment as provided in Section 12(c), the total number of shares
         of Stock reserved and available for delivery in connection with Awards
         under the Plan shall be (i) four million shares, plus (ii) the number
         of shares subject to awards under the Preexisting Plans which become
         available in accordance with Section 4(b) after the Effective Date,
         plus (iii) 10% of the number of shares issued or delivered by the
         Company during the term of the Plan other than issuances or deliveries
         under the Plan or other incentive compensation plans of the Company;
         provided, however, that the total number of shares with respect to
         which ISOs may be granted shall not exceed the number specified under
         clause (i) above; and provided further, that the total number of shares
         which may be issued and delivered in connection with Awards other than
         Options and SARs shall not exceed one million shares. Any shares of
         Stock delivered under the Plan shall consist of authorized and unissued
         shares or treasury shares.

                  (b) Share Counting Rules. The Committee may adopt reasonable
         counting procedures to ensure appropriate counting, avoid double
         counting (as, for example, in the case of tandem or substitute awards)
         and make adjustments if the number of shares of Stock actually
         delivered differs from the number of shares previously counted in
         connection with an Award. Shares subject to an Award or an award under
         the Preexisting Plans that is canceled, expired, forfeited, settled in
         cash or otherwise terminated without a delivery of shares to the
         Participant will again be available for Awards, and shares withheld in
         payment of the exercise price or taxes relating to an Award or
         Preexisting Plan award and shares equal to the number surrendered in
         payment of any exercise price or taxes relating to an Award or
         Preexisting Plan award shall be deemed to constitute shares not
         delivered to the Participant and shall be deemed to again be available
         for Awards under the Plan. In addition, in the case of any Award
         granted in assumption of or in substitution for an award of a company
         or business acquired by the Company or a subsidiary or affiliate or
         with which the Company or a subsidiary or affiliate combines, shares
         issued or issuable in connection with such substitute Award shall not
         be counted against the number of shares reserved under the Plan. This
         Section 4(b) shall apply to the number of shares reserved and available
         for ISOs only to the extent consistent with applicable regulations
         relating to ISOs under the Code.

5.       ELIGIBILITY; PER-PERSON AWARD LIMITATIONS.

                  (a) Eligibility. Awards may be granted under the Plan only to
         Eligible Persons. For purposes of the Plan, an "Eligible Person" means
         an employee of the Company or any subsidiary or affiliate, including
         any executive officer or non-employee director of the Company or a
         subsidiary or affiliate, and any person who has been offered employment
         by the Company or a subsidiary or affiliate, provided that such
         prospective employee may not receive any payment or exercise any right
         relating to an Award until such person has commenced employment with
         the Company or a subsidiary or affiliate. An employee on leave of
         absence may be considered as still in the employ of the Company or a
         subsidiary or affiliate for purposes of eligibility for participation
         in the Plan. For purposes of the Plan, a joint venture in which the
         Company or a subsidiary has a substantial direct or indirect equity
         investment shall be deemed an affiliate, if so determined by the
         Committee. Holders of awards granted by a company or business acquired
         by the Company or a subsidiary or affiliate, or with which the Company
         or a subsidiary or affiliate combines, are eligible for grants of
         substitute awards granted in assumption of or in substitution for such
         outstanding awards previously granted under the Plan in connection with
         such acquisition or combination transaction.

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                  (b) Per-Person Award Limitations. In each calendar year during
         any part of which the Plan is in effect, an Eligible Person may be
         granted Awards intended to qualify as "performance-based compensation"
         under Code Section 162(m) under each of Section 6(b), 6(c), 6(d), 6(e),
         6(f), 6(g) or 6(h) relating to up to his or her Annual Limit (such
         Annual Limit to apply separately to the type of Award authorized under
         each specified subsection, except that the limitation applies to
         Dividend Equivalents under Section 6(g) only if such Dividend
         Equivalents are granted separately from and not as a feature of another
         Award). A Participant's Annual Limit, in any year during any part of
         which the Participant is then eligible under the Plan, shall equal two
         million shares plus the amount of the Participant's unused Annual Limit
         relating to the same type of Award as of the close of the previous
         year, subject to adjustment as provided in Section 12(c). In the case
         of an Award which is not valued in a way in which the limitation set
         forth in the preceding sentence would operate as an effective
         limitation satisfying applicable law (including Treasury Regulation
         1.162-27(e)(4)), an Eligible Person may not be granted Awards
         authorizing the earning during any calendar year of an amount that
         exceeds the Eligible Person's Annual Limit, which for this purpose
         shall equal $4 million plus the amount of the Eligible Person's unused
         cash Annual Limit as of the close of the previous year (this limitation
         is separate and not affected by the number of Awards granted during
         such calendar year subject to the limitation in the preceding
         sentence). For this purpose, (i) "earning" means satisfying performance
         conditions so that an amount becomes payable, without regard to whether
         it is to be paid currently or on a deferred basis or continues to be
         subject to any service requirement or other non-performance condition,
         and (ii) a Participant's Annual Limit is used to the extent an amount
         or number of shares may be potentially earned or paid under an Award,
         regardless of whether such amount or shares are in fact earned or paid.

6.       SPECIFIC TERMS OF AWARDS.

                  (a) General. Awards may be granted on the terms and conditions
         set forth in this Section 6. In addition, the Committee may impose on
         any Award or the exercise thereof, at the date of grant or thereafter
         (subject to Section 12(e)), such additional terms and conditions, not
         inconsistent with the provisions of the Plan, as the Committee shall
         determine, including terms requiring forfeiture of Awards in the event
         of termination of employment or service by the Participant and terms
         permitting a Participant to make elections relating to his or her
         Award. The Committee shall retain full power and discretion with
         respect to any term or condition of an Award that is not mandatory
         under the Plan. The Committee shall require the payment of lawful
         consideration for an Award to the extent necessary to satisfy the
         requirements of the Delaware General Corporation Law, and may otherwise
         require payment of consideration for an Award except as limited by the
         Plan.

                  (b) Options. The Committee is authorized to grant Options to
         Participants on the following terms and conditions:

                           (i) Exercise Price. The exercise price per share of
                  Stock purchasable under an Option (including both ISOs and
                  non-qualified Options) shall be determined by the Committee,
                  provided that such exercise price shall be not less than the
                  Fair Market Value of a share of Stock on the date of grant of
                  such Option, subject to Section 9(a). Notwithstanding the
                  foregoing, any substitute award granted in assumption of or in
                  substitution for an outstanding award granted by a company or
                  business acquired by the Company or a subsidiary or affiliate,
                  or with which the Company or a subsidiary or affiliate
                  combines may be granted with an exercise price per share of
                  Stock other than as required above.

                           (ii) Option Term; Time and Method of Exercise. The
                  Committee shall determine the term of each Option, provided
                  that in no event shall the term of any ISO or SAR in tandem
                  therewith exceed a period of ten years from the date of grant.
                  The Committee shall determine the time or times at which or
                  the circumstances under which an Option may be exercised in
                  whole or in part (including based on achievement of
                  performance goals and/or future service


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                  requirements), the methods by which such exercise price may be
                  paid or deemed to be paid and the form of such payment
                  (subject to Section 12(k)), including, without limitation,
                  cash, Stock, other Awards or awards granted under other plans
                  of the Company or any subsidiary or affiliate, or other
                  property (including notes and 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 or forms in
                  which Stock will be delivered or deemed to be delivered in
                  satisfaction of Options to Participants (including deferred
                  delivery of shares representing the Option "profit," at the
                  election of the Participant or as mandated by the Committee,
                  with such deferred shares subject to any vesting, forfeiture
                  or other terms as the Committee may specify).

                           (iii) ISOs. The terms of any ISO granted under the
                  Plan shall comply in all respects with the provisions of Code
                  Section 422, including but not limited to the requirement that
                  no ISO shall be granted more than ten years after the
                  Effective Date.

                  (c) Stock Appreciation Rights. The Committee is authorized to
         grant SAR's to Participants on the following terms and conditions:

                           (i) Right to Payment. An SAR shall confer on the
                  Participant to whom it is granted a right to receive, upon
                  exercise thereof, the excess of (A) the Fair Market Value of
                  one share of Stock on the date of exercise (or, in the case of
                  a "Limited SAR," the Fair Market Value determined by reference
                  to the Change in Control Price, as defined under Section 10(d)
                  hereof) over (B) the grant price of the SAR as determined by
                  the Committee.

                           (ii) Other Terms. The Committee shall determine at
                  the date of grant or thereafter, the time or times at which
                  and the circumstances under which a SAR may be exercised in
                  whole or in part (including based on achievement of
                  performance goals and/or future service requirements), the
                  method of exercise, method of settlement, form of
                  consideration payable in settlement, method by or forms in
                  which Stock will be delivered or deemed to be delivered to
                  Participants, and whether or not a SAR shall be free-standing
                  or in tandem or combination with any other Award. Limited SARs
                  that may only be exercised in connection with a Change in
                  Control or other event as specified by the Committee may be
                  granted on such terms, not inconsistent with this Section
                  6(c), as the Committee may determine.

                  (d) Restricted Stock. Subject to Section 9(d), the Committee
         is authorized to grant Restricted Stock to Participants on the
         following terms and conditions:

                           (i) Grant and Restrictions. Restricted Stock shall be
                  subject to such restrictions on transferability, risk of
                  forfeiture and other restrictions, if any, as the Committee
                  may impose, which restrictions may lapse separately or in
                  combination at such times, under such circumstances (including
                  based on achievement of performance goals and/or future
                  service requirements), in such installments or otherwise and
                  under such other circumstances as the Committee may determine
                  at the date of grant or thereafter. Except to the extent
                  restricted under the terms of the Plan and any Award document
                  relating to the Restricted Stock, a Participant granted
                  Restricted Stock shall have all of the rights of a
                  stockholder, including the right to vote the Restricted Stock
                  and the right to receive dividends thereon (subject to any
                  mandatory reinvestment or other requirement imposed by the
                  Committee).

                           (ii) Forfeiture. Except as otherwise determined by
                  the Committee, upon termination of employment or service
                  during the applicable restriction period, Restricted Stock
                  that is at that time subject to restrictions shall be
                  forfeited and reacquired by the Company; provided that the
                  Committee may provide, by rule or regulation or in any Award
                  document, or may determine in


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                  any individual case, that restrictions or forfeiture
                  conditions relating to Restricted Stock will lapse in whole or
                  in part, including in the event of terminations resulting from
                  specified causes.

                           (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, the Committee may require that such certificates
                  bear an appropriate legend referring to the terms, conditions
                  and restrictions applicable to such Restricted Stock, that the
                  Company retain physical possession of the certificates, and
                  that the Participant deliver a stock power to the Company,
                  endorsed in blank, relating to the Restricted Stock.

                           (iv) Dividends and Splits. As a condition to the
                  grant of an Award of Restricted Stock, the Committee may
                  require that any dividends paid on a share of Restricted Stock
                  shall be either (A) paid with respect to such Restricted Stock
                  at the dividend payment date in cash, in kind, or in a number
                  of shares of unrestricted Stock having a Fair Market Value
                  equal to the amount of such dividends, or (B) automatically
                  reinvested in additional Restricted Stock or held in kind,
                  which shall be subject to the same terms as applied to the
                  original Restricted Stock to which it relates, or (C) deferred
                  as to payment, either as a cash deferral or with the amount or
                  value thereof automatically deemed reinvested in shares of
                  Deferred Stock, other Awards or other investment vehicles,
                  subject to such terms as the Committee shall determine or
                  permit a Participant to elect. Unless otherwise determined by
                  the Committee, Stock distributed in connection with a Stock
                  split or Stock dividend, and other property distributed as a
                  dividend, shall be subject to restrictions and a risk of
                  forfeiture to the same extent as the Restricted Stock with
                  respect to which such Stock or other property has been
                  distributed.

                  (e) Deferred Stock. The Committee is authorized to grant
         Deferred Stock to Participants, subject to the following terms and
         conditions:

                           (i) Award and Restrictions. Issuance of Stock will
                  occur upon expiration of the deferral period specified for an
                  Award of Deferred Stock by the Committee (or, if permitted by
                  the Committee, as elected by the Participant). In addition,
                  Deferred Stock shall be subject to such restrictions on
                  transferability, risk of forfeiture and other restrictions, if
                  any, as the Committee may impose, which restrictions may lapse
                  at the expiration of the deferral period or at earlier
                  specified times (including based on achievement of performance
                  goals and/or future service requirements), separately or in
                  combination, in installments or otherwise, and under such
                  other circumstances as the Committee may determine at the date
                  of grant or thereafter. Deferred Stock may be satisfied by
                  delivery of Stock, other Awards, or a combination thereof
                  (subject to Section 12(k)), as determined by the Committee at
                  the date of grant or thereafter.

                           (ii) Forfeiture. Except as otherwise determined by
                  the Committee, upon termination of employment or service
                  during the applicable deferral period or portion thereof to
                  which forfeiture conditions apply (as provided in the Award
                  document evidencing the Deferred Stock), all Deferred Stock
                  that is at that time subject to such forfeiture conditions
                  shall be forfeited; provided that the Committee may provide,
                  by rule or regulation or in any Award document, or may
                  determine in any individual case, that restrictions or
                  forfeiture conditions relating to Deferred Stock will lapse in
                  whole or in part, including in the event of terminations
                  resulting from specified causes.

                           (iii) Dividend Equivalents. Unless otherwise
                  determined by the Committee, Dividend Equivalents on the
                  specified number of shares of Stock covered by an Award of
                  Deferred Stock shall be either (A) paid with respect to such
                  Deferred Stock at the dividend payment date in cash or in
                  shares of unrestricted Stock having a Fair Market Value equal
                  to the amount of such dividends, or (B) deferred with respect
                  to such Deferred Stock, either as a cash deferral


                                     - 8 -
<PAGE>
                  or with the amount or value thereof automatically deemed
                  reinvested in additional Deferred Stock, other Awards or other
                  investment vehicles having a Fair Market Value equal to the
                  amount of such dividends, as the Committee shall determine or
                  permit a Participant to elect.

                  (f) Bonus Stock and Awards in Lieu of Obligations. The
         Committee is authorized to grant Stock as a bonus, or to grant Stock or
         other Awards in lieu of obligations of the Company or a subsidiary or
         affiliate to pay cash or deliver other property under the Plan or under
         other plans or compensatory arrangements, subject to such terms as
         shall be determined by the Committee.

                  (g) Dividend Equivalents. The Committee is authorized to grant
         Dividend Equivalents to a Participant, which may be awarded on a
         free-standing basis or in connection with another Award. The Committee
         may provide that Dividend Equivalents shall be paid or distributed when
         accrued or shall be deemed to have been reinvested in additional Stock,
         Awards, or other investment vehicles, and subject to restrictions on
         transferability, risks of forfeiture and such other terms as the
         Committee may specify.

                  (h) Other Stock-Based Awards. The Committee is authorized,
         subject to limitations under applicable law, to grant to Participants
         such other Awards that may be denominated or payable in, valued in
         whole or in part by reference to, or otherwise based on, or related to,
         Stock or factors that may influence the value of Stock, including,
         without limitation, convertible or exchangeable debt securities, other
         rights convertible or exchangeable into Stock, purchase rights for
         Stock, Awards with value and payment contingent upon performance of the
         Company or business units thereof or any other factors designated by
         the Committee, and Awards valued by reference to the book value of
         Stock or the value of securities of or the performance of specified
         subsidiaries or affiliates or other business units. The Committee shall
         determine the terms and conditions of such Awards. Stock delivered
         pursuant to an Award in the nature of a purchase right granted under
         this Section 6(h) shall be purchased for such consideration, paid for
         at such times, by such methods, and in such forms, including, without
         limitation, cash, Stock, other Awards, notes, or other property, as the
         Committee shall determine. Cash awards, as an element of or supplement
         to any other Award under the Plan, may also be granted pursuant to this
         Section 6(h).

                  (i) Performance Awards. Performance Awards, denominated in
         cash or in Stock or other Awards, may be granted by the Committee in
         accordance with Section 7.


7.       PERFORMANCE AWARDS, INCLUDING ANNUAL INCENTIVE AWARDS.

                  (a) Performance Awards Generally. Performance Awards may be
         denominated as a cash amount, number of shares of Stock, or specified
         number of other Awards (or a combination) which may be earned upon
         achievement or satisfaction of performance conditions specified by the
         Committee. In addition, the Committee may specify that any other Award
         shall constitute a Performance Award by conditioning the right of a
         Participant to exercise the Award or have it settled, and the timing
         thereof, upon achievement or satisfaction of such performance
         conditions as may be specified by the Committee. The Committee may use
         such business criteria and other measures of performance as it may deem
         appropriate in establishing any performance conditions, and may
         exercise its discretion to reduce or increase the amounts payable under
         any Award subject to performance conditions, except as limited under
         Sections 7(b) and 7(c) in the case of a Performance Award intended to
         qualify as "performance-based compensation" under Code Section 162(m).

                  (b) Performance Awards Granted to Covered Employees. If the
         Committee determines that a Performance Award to be granted to an
         Eligible Person who is designated by the Committee as likely to be a
         Covered Employee should qualify as "performance-based compensation" for
         purposes of Code Section 162(m), the grant, exercise and/or settlement
         of such Performance Award shall be


                                     - 9 -
<PAGE>
         contingent upon achievement of a preestablished performance goal and
         other terms set forth in this Section 7(b).

                           (i) Performance Goal Generally. The performance goal
                  for such Performance Awards shall consist of one or more
                  business criteria and a targeted level or levels of
                  performance with respect to each of such criteria, as
                  specified by the Committee consistent with this Section 7(b).
                  The performance goal shall be objective and shall otherwise
                  meet the requirements of Code Section 162(m) and regulations
                  thereunder, including the requirement that the level or levels
                  of performance targeted by the Committee result in the
                  achievement of performance goals being "substantially
                  uncertain." The Committee may determine that such Performance
                  Awards shall be granted, exercised and/or settled upon
                  achievement of any one performance goal or that two or more of
                  the performance goals must be achieved as a condition to
                  grant, exercise and/or settlement of such Performance Awards.
                  Performance goals may differ for Performance Awards granted to
                  any one Participant or to different Participants.

                           (ii) Business Criteria. One or more of the following
                  business criteria for the Company, on a consolidated basis,
                  and/or for specified subsidiaries or affiliates or other
                  business units of the Company shall be used by the Committee
                  in establishing performance goals for such Performance Awards:
                  (1) advertising sales (either calendar cycle or publication
                  cycle basis) or other sales or revenue measures; (2) operating
                  income, earnings from operations, earnings before or after
                  taxes, earnings before or after interest, depreciation,
                  amortization, or extraordinary or special items, (3) net
                  income or net income per common share (basic or diluted); (4)
                  return on assets, return on investment, return on capital, or
                  return on equity; (5) cash flow, free cash flow, cash flow
                  return on investment, or net cash provided by operations; (6)
                  interest expense after taxes; (7) economic profit or value
                  created; (8) operating margin; (9) stock price or total
                  stockholder return; and (10) strategic business criteria,
                  consisting of one or more objectives based on meeting
                  specified market penetration, geographic business expansion
                  goals, cost targets, customer satisfaction, employee
                  satisfaction, management of employment practices and employee
                  benefits, supervision of litigation and information
                  technology, and goals relating to acquisitions or divestitures
                  of subsidiaries, affiliates or joint ventures. The targeted
                  level or levels of performance with respect to such business
                  criteria may be established at such levels and in such terms
                  as the Committee may determine, in its discretion, including
                  in absolute terms, as a goal relative to performance in prior
                  periods, or as a goal compared to the performance of one or
                  more comparable companies or an index covering multiple
                  companies.

                           (iii) Performance Period; Timing for Establishing
                  Performance Goals. Achievement of performance goals in respect
                  of such Performance Awards shall be measured over a
                  performance period of up to one year or more than one year, as
                  specified by the Committee. A performance goal shall be
                  established not later than the earlier of (A) 90 days after
                  the beginning of any performance period applicable to such
                  Performance Award or (B) the time 25% of such performance
                  period has elapsed.

                           (iv) Performance Award Pool. The Committee may
                  establish a Performance Award pool, which shall be an unfunded
                  pool, for purposes of measuring performance of the Company in
                  connection with Performance Awards. The amount of such
                  Performance Award pool shall be based upon the achievement of
                  a performance goal or goals based on one or more of the
                  business criteria set forth in Section 7(b)(ii) during the
                  given performance period, as specified by the Committee in
                  accordance with Section 7(b)(iv). The Committee may specify
                  the amount of the Performance Award pool as a percentage of
                  any of such business criteria, a percentage thereof in excess
                  of a threshold amount, or as another amount which need not
                  bear a strictly mathematical relationship to such business
                  criteria.

                                     - 10 -
<PAGE>
                           (v) Settlement of Performance Awards; Other Terms.
                  Settlement of Performance Awards shall be in cash, Stock,
                  other Awards or other property, in the discretion of the
                  Committee. The Committee may, in its discretion, increase or
                  reduce the amount of a settlement otherwise to be made in
                  connection with such Performance Awards, but may not exercise
                  discretion to increase any such amount payable to a Covered
                  Employee in respect of a Performance Award subject to this
                  Section 7(b). Any settlement which changes the form of payment
                  from that originally specified shall be implemented in a
                  manner such that the Performance Award and other related
                  Awards do not, solely for that reason, fail to qualify as
                  "performance-based compensation" for purposes of Code Section
                  162(m). The Committee shall specify the circumstances in which
                  such Performance Awards shall be paid or forfeited in the
                  event of termination of employment by the Participant or other
                  event (including a Change in Control) prior to the end of a
                  performance period or settlement of such Performance Awards.

                  (c) Annual Incentive Awards Granted to Designated Covered
         Employees. The Committee may grant an Annual Incentive Award to an
         Eligible Person who is designated by the Committee as likely to be a
         Covered Employee. Such Annual Incentive Award will be intended to
         qualify as "performance-based compensation" for purposes of Code
         Section 162(m), and its grant, exercise and/or settlement shall be
         contingent upon achievement of preestablished performance goals and
         other terms set forth in this Section 7(c).

                           (i) Grant of Annual Incentive Awards. Not later than
                  the earlier of 90 days after the beginning of any performance
                  period applicable to such Annual Incentive Award or the time
                  25% of such performance period has elapsed, the Committee
                  shall determine the Covered Employees who will potentially
                  receive Annual Incentive Awards, and the amount(s) potentially
                  payable thereunder, for that performance period. The amount(s)
                  potentially payable shall be based upon the achievement of a
                  performance goal or goals based on one or more of the business
                  criteria set forth in Section 7(b)(ii) in the given
                  performance period, as specified by the Committee. The
                  Committee may designate an annual incentive award pool as the
                  means by which Annual Incentive Awards will be measured, which
                  pool shall conform to the provisions of Section 7(b)(iv). In
                  such case, the portion of the Annual Incentive Award pool
                  potentially payable to each Covered Employee shall be
                  preestablished by the Committee. In all cases, the maximum
                  Annual Incentive Award of any Participant shall be subject to
                  the limitation set forth in Section 5.

                           (ii) Payout of Annual Incentive Awards. After the end
                  of each performance period, the Committee shall determine the
                  amount, if any, of the Annual Incentive Award for that
                  performance period payable to each Participant. The Committee
                  may, in its discretion, determine that the amount payable to
                  any Participant as a final Annual Incentive Award shall be
                  reduced from the amount of his or her potential Annual
                  Incentive Award, including a determination to make no final
                  Award whatsoever, but may not exercise discretion to increase
                  any such amount. The Committee shall specify the circumstances
                  in which an Annual Incentive Award shall be paid or forfeited
                  in the event of termination of employment by the Participant
                  or other event prior to the end of a performance period or
                  settlement of such Annual Incentive Award.

                  (d) Written Determinations. Determinations by the Committee as
         to the establishment of performance goals, the amount potentially
         payable in respect of Performance Awards and Annual Incentive Awards,
         the level of actual achievement of the specified performance goals
         relating to Performance Awards and Annual Incentive Awards, and the
         amount of any final Performance Award and Annual Incentive Award shall
         be recorded in writing in the case of Performance Awards intended to
         qualify under Section 162(m). Specifically, the Committee shall certify
         in writing, in a manner conforming to applicable regulations under
         Section 162(m), prior to settlement of each such Award


                                     - 11 -
<PAGE>
         granted to a Covered Employee, that the performance objective relating
         to the Performance Award and other material terms of the Award upon
         which settlement of the Award was conditioned have been satisfied.

         8. NON-EMPLOYEE DIRECTOR AWARDS. Options, Deferred Stock, Restricted
Stock and other Awards (which other Awards, if granted, will be governed by
Sections 6 and 7 of this Plan) shall be granted to non-employee directors of the
Company or a subsidiary or an affiliate in accordance with policies established
from time to time by the Board specifying the classes of non-employee directors
to be granted such Awards, the number of shares to be subject to each Award, and
the time or times at which such Awards shall be granted. All Options granted to
non-employee directors shall be non-qualified stock options.

                  (a) Initial Policy -- Option Grants. The initial policy with
         respect to Options granted under this Section 8(a), effective as of the
         Effective Date and continuing until modified or revoked by the Board
         from time to time, shall be as follows:

                           (i) Initial Grants. At the date of a person's initial
                  election or appointment as a member of the Board after the
                  Effective Date, such person, if he or she is a non-employee
                  director of the Company eligible to participate upon such
                  election or appointment, shall be granted an Option to
                  purchase 1,500 shares of Stock, subject to adjustment as
                  provided in Section 12(c). At the Effective Date, each person
                  who is a non-employee director of the Company eligible to
                  participate at that date shall be granted an Option to
                  purchase 1,500 shares of Stock, subject to adjustment as
                  provided in Section 12(c).

                           (ii) Annual Grants. At the date of each annual
                  meeting of shareholders following the Effective Date at which
                  a director is elected or reelected as a member of the Board
                  (or at which members of another class of directors are elected
                  or reelected, if the Company then has a classified Board),
                  such director, if he or she is a non-employee director of the
                  Company eligible to participate at that date and if he or she
                  has not been granted an Option under this Section 8(a)
                  previously during the same calendar year, shall be granted an
                  Option to purchase 1,500 shares of Stock, subject to
                  adjustment as provided in Section 12(c).

                  (b) Terms of Options Granted Under Section 8(a). Each Option
         granted under Section 8(a) shall be subject to the following terms and
         conditions:

                           (i) Exercise Price. The exercise price per share of
                  Stock purchasable under an Option shall be equal to 100% of
                  the Fair Market Value of Stock on the date of grant of the
                  Option, subject to Section 9(a).

                           (ii) Option Term. Each Option shall expire ten years
                  after the date of grant, or such earlier date as the Option
                  may no longer be exercised and cannot, by its terms,
                  thereafter become exercisable.

                           (iii) Vesting and Exercisability. The Board may
                  establish terms regarding the times at which Options shall
                  become vested and exercisable. Unless otherwise determined by
                  the Board, an Option granted under this Section 8(a) and not
                  previously forfeited shall vest and become exercisable by a
                  Participant as to one-third of the number of shares subject to
                  the Option at the close of business on the day preceding each
                  of the three annual meetings of shareholders following the
                  date of grant of the Option, rounded to the nearest number of
                  whole shares. The foregoing notwithstanding, an Option not
                  previously forfeited shall vest and become exercisable on an
                  accelerated


                                     - 12 -
<PAGE>
                  basis upon a Change in Control or upon the termination of the
                  Participant's service as a director due to death, Disability
                  or Retirement. Unless otherwise determined by the Board, an
                  Option will cease to vest and become exercisable upon the
                  termination of the Participant's service prior to a Change in
                  Control for any reason other than death, Disability or
                  Retirement, and such portion that has not vested and become
                  exercisable at the time of such termination shall be
                  forfeited.

                           (iv) Payment. The exercise price of an Option shall
                  be paid to the Company either in cash or by the surrender of
                  Stock, or any combination thereof, or in such other form or
                  manner as may be consistent with Section 6(b)(ii).

                  (c) Initial Policy -- Grant of Deferred Stock and Restricted
         Stock. The initial policy with respect to Awards granted under this
         Section 8(c), effective as of the Effective Date and continuing until
         modified or revoked by the Board from time to time, shall be as
         follows:

                           (i) Initial Grant. At the date of a person's initial
                  election or appointment as a member of the Board after the
                  Effective Date, such person, if he or she is a non-employee
                  director of the Company eligible to participate upon such
                  election or appointment, shall be granted 1,500 shares of
                  Deferred Stock, subject to adjustment as provided in Section
                  12(c). At the Effective Date, each person who is a
                  non-employee director of the Company eligible to participate
                  at that date shall be granted 1,500 shares of Deferred Stock,
                  subject to adjustment as provided in Section 12(c).

                           (ii) Annual Grants. At the date of each annual
                  meeting of shareholders following the Effective Date at which
                  a director is elected or reelected as a member of the Board
                  (or at which members of another class of directors are elected
                  or reelected, if the Company then has a classified Board),
                  such director, if he or she is a non-employee director of the
                  Company eligible to participate at that date and if he or she
                  has not been granted Deferred Stock or Restricted Stock under
                  Section 8(c) previously during the same calendar year, shall
                  be granted 1,500 shares of Deferred Stock, unless the director
                  has elected, prior to such annual meeting of shareholders, to
                  receive such grant in the form of an equal number of shares of
                  Restricted Stock. The number of shares subject to such annual
                  grants shall be subject to adjustment as provided in Section
                  12(c).

                  (d) Terms of Deferred Stock and Restricted Stock Granted Under
         Section 8(c). Deferred Stock granted under Section 8(c) shall be
         subject to the terms and conditions of Deferred Stock specified in
         Sections 8(f)(ii), (iii), and (iv), unless otherwise determined by the
         Board. Deferred Stock and Restricted Stock granted under this Section
         8(c) shall also be subject to the following additional terms and
         conditions:

                           (i) Vesting and Forfeiture. The Board may establish
                  terms regarding the times at which Deferred Stock and
                  Restricted Stock shall become vested and non-forfeitable.
                  Unless otherwise determined by the Board, an Award granted
                  under Section 8(c) and not previously forfeited shall become
                  vested and non-forfeitable as to one-third of the number of
                  shares of Deferred Stock or Restricted Stock at the close of
                  business on the day preceding each of the three annual
                  meetings of shareholders following the date of grant of such
                  Award, rounded to the nearest number of whole shares. The
                  foregoing notwithstanding, an Award of Deferred Stock or
                  Restricted Stock not previously vested or forfeited shall vest
                  and become non-forfeitable on an accelerated basis upon a
                  Change in Control or upon the termination of the Participant's
                  service as a director due to death, Disability or Retirement.
                  Unless otherwise determined by the Board, an Award of Deferred
                  Stock or Restricted Stock not previously vested or forfeited
                  will cease to vest


                                     - 13 -
<PAGE>
                  and will be forfeited upon the termination of the
                  Participant's service prior to a Change in Control for any
                  reason other than death, Disability or Retirement.

                           (ii) Deferred Stock Credited as a Result of Dividend
                  Equivalents. Unless otherwise determined by the Board,
                  Deferred Stock credited as a result of Dividend Equivalents
                  under Section 8(f)(ii) shall be subject to the same terms,
                  including risk of forfeiture, as the Deferred Stock with
                  respect to which the dividend equivalents were credited.

                           (iii) Dividends on Restricted Stock. Unless otherwise
                  determined by the Board, dividends on Restricted Stock
                  declared and paid prior to the lapse of the risk of forfeiture
                  on such Restricted Stock shall be automatically reinvested in
                  additional shares of Restricted Stock, which shall be subject
                  to the same terms, including risk of forfeiture, as the
                  Restricted Stock on which the dividend was paid.

                           (iv) Awards Nontransferable. Deferred Stock and
                  Restricted Stock shall be nontransferable by the Participant
                  at any time that the Award remains subject to a risk of
                  forfeiture.

                  (e) Options Granted in Payment of Fees and Deferral of Fees in
         Deferred Stock and Deferred Cash. Each non-employee director of the
         Company may elect, in accordance with Section 8(e)(i), to be paid
         Retainer Fees in the form of Options under Section 8(e)(ii) or to defer
         receipt of Retainer Fees and Other Director Compensation in the form of
         Deferred Stock under Section 8(e)(iii) or deferred cash under Section
         8(e)(iv).

                           (i) Elections. A director shall elect to participate
                  and the terms of such participation by filing an election with
                  the Company prior to the beginning of a Plan Year (the initial
                  Plan Year will begin August 14, 1998 and Plan Years thereafter
                  generally will begin at each annual meeting of shareholders
                  or, in the case of a new director, upon initial appointment)
                  or at such other date as may be specified by the Board,
                  provided that any date so specified shall ensure effective
                  deferral of taxation and otherwise comply with applicable
                  laws.

                                    (A) Effect and Irrevocability of Elections.
                           Elections shall be deemed continuing, and therefore
                           applicable to Plan Years after the initial Plan Year
                           covered by the election, until the election is
                           modified or superseded by the Participant. Elections
                           other than those subject to Section 8(f)(iv) shall
                           become irrevocable at the commencement of the Plan
                           Year to which an election relates, unless the Board
                           specifies a different time. Elections relating to the
                           time of settlement of a Deferral Account shall become
                           irrevocable at the time specified in Section
                           8(f)(iv). Elections may be modified or revoked by
                           filing a new election prior to the time the election
                           to be modified or revoked has become irrevocable. The
                           latest election filed with the Board shall be deemed
                           to revoke all prior inconsistent elections that
                           remain revocable at the time of filing of the latest
                           election.

                                    (B) Matters To Be Elected. The Company will
                           provide a form of election which will permit a
                           director to make appropriate elections with respect
                           to all relevant matters under this Section 8.

                                    (C) Time of Filing Elections. An election
                           must be received by the Company prior to the date
                           specified by the Board. Under no circumstances may a

                                     - 14 -
<PAGE>
                           Participant defer compensation to which the
                           Participant has attained, at the time of deferral, a
                           legally enforceable right to current receipt of such
                           compensation.

                           (ii) Options Granted in Payment of Retainer Fees. A
                  Participant who has elected to be paid a specified amount of
                  Retainer Fees in the form of Options shall be granted, at the
                  close of business on the day the Participant's Plan Year
                  commences an Option to purchase the number of whole shares of
                  Stock determined in accordance with the Option Valuation
                  Methodology specified by the Board. Each Option granted under
                  this Section 8(e)(ii) shall be subject to the following terms
                  and conditions:

                                    (A) Option Valuation Methodology. The Board
                           shall determine the Option Valuation Methodology
                           which will be used to determine the number of Options
                           granted and the Option exercise price. The Option
                           Valuation Methodology may be based upon a valuation
                           of the Option, a discounting of the aggregate
                           exercise price of the Options by the amount of
                           Retainer Fees to be paid in the form of Options, or
                           such other methodology as may be deemed reasonable
                           for purposes of this Section 8(e)(ii).

                                    (B) Option Term. Each Option will expire ten
                           years after the date of grant; provided, however,
                           that, unless otherwise determined by the Board, any
                           portion of an Option that is not yet exercisable as
                           of the date a Participant ceases to serve as a
                           director for any reason will expire at the date such
                           service ceases.

                                    (C) Vesting and Exercisability. Unless
                           otherwise determined by the Board, each Option will
                           vest and become exercisable as to 25% of the
                           underlying shares on the June 30, September 30,
                           December 31, and March 31 following the date of
                           grant; provided, however, that, in the case of a Plan
                           Year which begins on or after June 30 and before
                           September 30, the vesting percentage shall be 33%,
                           and in the case of a Plan Year which begins on or
                           after September 30 and before December 31, the
                           vesting percentage shall be 50%; and provided
                           further, that an Option will become fully vested and
                           exercisable at the close of business on the last day
                           of the Plan Year in which it was granted. The number
                           of shares as to which the Option becomes vested and
                           exercisable will be rounded to the nearest whole
                           number. The foregoing notwithstanding, (i) upon a
                           Change in Control a Participant's Option not
                           previously forfeited shall vest and become
                           exercisable in full, and (ii) upon termination of the
                           Participant's service as a director due to death,
                           Disability, or Retirement, that portion of the Option
                           which would become vested and exercisable on the last
                           day of the calendar quarter in which such death,
                           Disability, or Retirement occurred will become
                           immediately vested and exercisable.

                                    (D) Exercise Price. The exercise price per
                           share of Stock purchasable under an Option will be
                           determined in accordance with the Option Valuation
                           Methodology. The exercise price of an Option shall be
                           paid to the Company either in cash or by the
                           surrender of Stock, or any combination thereof, or in
                           such other form or manner as may be established by
                           the Board; provided, however, that, unless otherwise
                           determined by the Board, shares shall not be
                           surrendered in payment of the exercise price if such
                           surrender would result in additional accounting
                           expense to the Company.

                                    (E) Changes in Fees; Changes in Service as a
                           Committee Chair. If the amount of Retainer Fees is
                           increased during a Plan Year, or if a Director is
                           appointed chair of a Board committee such that an
                           additional Retainer Fee is


                                     - 15 -
<PAGE>
                           payable during a Plan Year, such increased or
                           additional fees will not be paid in the form of
                           Options. If a Director has been granted an Option in
                           respect of a Plan Year in payment of Retainer Fees
                           which included committee-related fees for service as
                           chair or a member of any Board committee, and during
                           such Plan Year he or she ceases such service but
                           remains on the Board, the Option will expire in part
                           at the time such service ceases, to the extent of
                           that portion of the Option which is not yet
                           exercisable multiplied by a fraction the numerator of
                           which is the amount of committee-related fees
                           included in such Retainer Fees and the denominator of
                           which is the total amount of such Retainer Fees.

                                    (F) Service During Part of a Quarter. If a
                           Participant ceases to serve as a director or on
                           committee at a date other than a vesting date for the
                           Option and if the Board does not exercise its
                           discretion to permit vesting of the Participant's
                           Option in consideration for the Participant's service
                           in that final quarterly period, the Participant shall
                           be entitled to payment in cash for his or her service
                           in that final quarterly period if and to the extent
                           then provided in the Company's regular non-employee
                           director compensation policies.

                           (iii) Deferral of Retainer Fees and Other Director
                  Compensation in the Form of Deferred Stock. If a Participant
                  has elected to defer receipt of a specified amount of Retainer
                  Fees or Other Director Compensation in the form of Deferred
                  Stock, a number of shares of Deferred Stock shall be credited
                  to the Participant's Deferred Stock Account, as of the date
                  such Retainer Fees or Other Director Compensation otherwise
                  would have been payable to the Participant but for such
                  election to defer, equal to (i) such amount otherwise payable
                  divided by (ii) the Fair Market Value of a share of Stock at
                  that date. Deferred Shares credited under this Section
                  8(e)(iii) shall be subject to the terms and conditions of
                  Deferred Stock specified in Sections 8(f)(ii), (iii) and (iv).
                  The right and interest of each Participant in Deferred Stock
                  credited to the Participant's Deferred Stock Account under
                  this Section 8(e)(iii) at all times will be nonforfeitable.

                           (iv) Deferral of Retainer Fees and Other Director
                  Compensation in the Form of Deferred Cash. If a Participant
                  has elected to defer receipt of a specified amount of Retainer
                  Fees or Other Director Compensation in the form of deferred
                  cash, an amount equal to such specified amount shall be
                  credited to the Participant's Deferred Cash Account as of the
                  date such Retainer Fees or Other Director Compensation
                  otherwise would have been payable to the Participant but for
                  such election to defer. Each Participant shall be entitled to
                  direct the manner in which his or her Deferred Cash Account
                  will be deemed to be invested, selecting among the same
                  investment alternatives (other than Company common stock) as
                  are offered from time to time to participants in the Company's
                  Deferred Compensation Plan. The right and interest of each
                  Participant relating to his or her Deferred Cash Account at
                  all times will be nonforfeitable.

                           (v) Cessation of Service as a Director. If any
                  Retainer Fee or Other Director Compensation otherwise subject
                  to an election would be paid to a Participant after he or she
                  has ceased to serve as a director, such payment shall not be
                  subject to deferral under this Section 8(e), but shall instead
                  be paid in accordance with the Company's regular non-employee
                  director compensation policies.

                  (f) Other Deferrals and Terms of Deferral Accounts.

                           (i) Deferral of Certain Option Shares. Upon any
                  exercise of an Option or an option granted under any other
                  plan or program of the Company by a non-employee


                                     - 16 -
<PAGE>
                  director, if the exercise price of such option is paid by
                  surrender of shares of Stock to the Company, the director may
                  elect to defer receipt of all or a portion of the shares
                  deliverable upon exercise of the option in excess of the
                  number surrendered in payment of the exercise price. In such
                  case, the number of shares deferred shall be credited to the
                  Participant's Deferred Stock Account.

                           (ii) Dividend Equivalents on Deferred Stock. Dividend
                  Equivalents will be credited on Deferred Stock credited to a
                  Participant's Deferred Stock Account(s) as follows:

                                    (A) Cash and Non-Share Dividends. If the
                           Company declares and pays a dividend on Stock in the
                           form of cash or property other than shares of Stock,
                           then a number of additional shares of Deferred Stock
                           shall be credited to a Participant's Deferred Stock
                           Account(s) as of the payment date for such dividend
                           equal to (i) the number of shares of Deferred Stock
                           credited to the respective Account as of the record
                           date for such dividend, multiplied by (ii) the amount
                           of cash plus the Fair Market Value of any property
                           other than shares actually paid as a dividend on each
                           share at such payment date, divided by (iii) the Fair
                           Market Value of a share of Stock at such payment
                           date.

                                    (B) Share Dividends and Splits. If the
                           Company declares and pays a dividend on Stock in the
                           form of additional shares of Stock, or there occurs a
                           forward split of Stock, then a number of additional
                           shares of Deferred Stock shall be credited to the
                           Participant's Deferred Stock Account(s) as of the
                           payment date for such dividend or forward Stock split
                           equal to (i) the number of shares of Deferred Stock
                           credited to the respective Account as of the record
                           date for such dividend or split multiplied by (ii)
                           the number of additional shares actually paid as a
                           dividend or issued in such split in respect of each
                           share of Stock.

                           (iii) Reallocation of Accounts. A Participant may
                  allocate amounts credited to his or her Deferred Cash Account
                  to one or more of the investment vehicles authorized under the
                  Company's Deferred Compensation Plan. Subject to the rules
                  established by the Board and subject to the provisions of this
                  Section 8(f), a Participant may reallocate amounts credited to
                  his or her Deferred Cash Account as of the Valuation Date
                  following the Participant's election, to one or more of such
                  investment vehicles, by filing with the Company a notice, in
                  such form, and in accordance with such procedures, as the
                  Board shall determine from time to time. The Board may, in its
                  discretion, restrict allocation into or reallocation by
                  specified Participants into or out of special investment
                  vehicles or specify minimum or maximum amounts that may be
                  allocated or reallocated by Participants. Notwithstanding the
                  foregoing, a Participant shall have no right to have amounts
                  credited as cash to the Participant's Deferred Cash Account
                  reallocated or switched to his or her Deferred Stock Account
                  or amounts credited to the Participant's Deferred Stock
                  Account reallocated or switched to his or her Deferred Cash
                  Account, except as may be permitted by the Board.

                           (iv) Elections as to Settlement. Each Participant,
                  while still a director of the Company, shall file an election
                  with the Company specifying the time or times at which the
                  Participant's Deferral Account will be settled, following the
                  Participant's termination of service as a director of the
                  Company, and whether distribution will be in a single lump sum
                  or in a number of annual installments not exceeding ten (or
                  such other number as may be determined by the Board);
                  provided, however, that, if no valid election has been filed
                  as to the time of settlement of a Participant's Deferral
                  Account or any portion thereof, such Deferral Account or
                  portion thereof shall be distributed in a single lump sum

                                     - 17 -
<PAGE>
                  on the first business day of the year following the year in
                  which the Participant ceases to serve as a director. If
                  installments are elected, such installments must be annual
                  installments, unless otherwise determined by the Board,
                  commencing not later than the first year following the year in
                  which the Participant ceases to serve as a director (on such
                  annual installment date as may be specified by the Board) and
                  extending over a period not to exceed ten years, unless
                  otherwise determined by the Board.

                                    (A) Matters Covered by Election. Subject to
                           the terms of the Plan, the Board shall determine
                           whether all deferrals under the Plan must be subject
                           to a single election as to the time or times of
                           settlement, or whether settlement elections may
                           relate to a specified sub-account (i.e., the Deferred
                           Stock Account or the Deferred Cash Account) and/or a
                           specified Plan Year. If the Board permits elections
                           to relate to a specified Plan Year, such election
                           shall apply to the amounts originally credited to the
                           specified subaccount in respect of such Plan Year and
                           to any additional amounts credited as Dividend
                           Equivalents or interest in respect of such originally
                           credited amounts and previously credited additional
                           amounts.

                                    (B) Modifying Elections. A Participant may
                           modify a prior election as to the time at which a
                           Participant's Deferral Account (including a specified
                           subaccount) will be settled at any time prior to the
                           time the Participant ceases to serve as a director,
                           subject to such requirements as may be specified by
                           the Company. Such modification shall be made by
                           filing a new election with the Company. The foregoing
                           notwithstanding, the Board may disapprove or limit
                           elections under this Section 8(f)(iv) in order to
                           ensure that the Participant will not be deemed to
                           have constructively received compensation in respect
                           of the Participant's Deferral Account prior to
                           settlement.

                           (v) Election Forms. Elections under the Plan shall be
                  made in writing on such form or forms as may be specified from
                  time to time by the Board.

                           (vi) Statements. The Company will furnish statements
                  to each Participant reflecting the amount credited to a
                  Participant's Deferral Account, transactions therein, and
                  other related information no less frequently than once each
                  calendar year.

                           (vii) Fractional Shares. The amount of Deferred Stock
                  credited to a Deferred Stock Account shall include fractional
                  shares calculated to at least three decimal places.

                  (g) Settlement of Deferral Accounts. The Company will settle a
         Participant's Deferral Account by making one or more distributions to
         the Participant (or his or her Beneficiary, following Participant's
         death) at the time or times, in a lump sum or installments, as
         specified in the Participant's election filed in accordance with
         Section 8(f)(iv); provided, however, that a Deferral Account will be
         settled at times earlier than those specified in such election in
         accordance with Sections 8(g)(ii), (iii), and (iv).

                           (i) Form of Distribution. Distributions in respect of
                  a Participant's Deferred Stock Account shall be made only in
                  shares of Stock, together with cash in lieu of any fractional
                  share remaining at a time that less than one whole share of
                  Deferred Stock is credited to such Deferred Stock Account.
                  Shares may be delivered in certificate form to a Participant
                  (or his or her Beneficiary) or to a nominee for the account of
                  the Participant (or his or her Beneficiary), or in such other
                  manner as the Board may determine. Distributions in respect of
                  a Participant's Deferred Cash Account shall be made only in
                  cash.

                                     - 18 -
<PAGE>
                           (ii) Death. If a Participant ceases to serve as a
                  director due to death or dies prior to distribution of all
                  amounts from his or her Deferral Account, the Company shall
                  make a single lump-sum distribution to the Participant's
                  Beneficiary. Any such distribution shall be made as soon as
                  practicable following notification to the Company of the
                  Participant's death.

                           (iii) Financial Emergency and Other Payments. Other
                  provisions of the Plan notwithstanding, if, upon the written
                  application of a Participant, the Board determines that the
                  Participant has a financial emergency of such a substantial
                  nature and beyond the Participant's control that payment of
                  amounts previously deferred under the Plan is warranted, the
                  Board may direct the payment to the Participant of all or a
                  portion of the balance of a Deferral Account and the time and
                  manner of such payment.

                           (iv) Change in Control. In the event of a Change in
                  Control, payments in settlement of any Deferral Account
                  (including a Deferral Account with respect to which one or
                  more installment payments have previously been made) shall be
                  made within fifteen (15) business days following such Change
                  in Control.

9.       CERTAIN PROVISIONS APPLICABLE TO AWARDS.

         (a) 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 or exchange
for, any other Award or any award granted under another plan of the Company, any
subsidiary or affiliate, or any business entity to be acquired by the Company or
a subsidiary or affiliate, or any other right of a Participant to receive
payment from the Company or any subsidiary or affiliate. Awards granted in
addition to or in tandem with other Awards or awards may be granted either as of
the same time as or a different time from the grant of such other Awards or
awards. Subject to Section 12(k), the Committee may determine that, in granting
a new Award, the in-the-money value of any surrendered Award or award or the
value of any other right to payment surrendered by the Participant may be
applied to reduce the exercise price of any Option, grant price of any SAR, or
purchase price of any other Award.

         (b) Term of Awards. The term of each Award shall be for such period as
may be determined by the Committee, subject to the express limitations set forth
in Sections 6(b)(ii) and 8 or elsewhere in the Plan.

         (c) Form and Timing of Payment under Awards; Deferrals. Subject to the
terms of the Plan (including Section 12(k)) and any applicable Award document,
payments to be made by the Company or a subsidiary or affiliate upon the
exercise of an Option or other Award or settlement of an Award may be made in
such forms as the Committee shall determine, including, without limitation,
cash, Stock, other Awards or other property, and may be made in a single payment
or transfer, in installments, or on a deferred basis. The settlement of any
Award may be accelerated, and cash paid in lieu of Stock in connection with such
settlement, in the discretion of the Committee or upon occurrence of one or more
specified events (subject to Section 12(k)). Installment or deferred payments
may be required by the Committee (subject to Section 12(e)) or permitted at the
election of the Participant on terms and conditions established by the
Committee. Payments may include, without limitation, provisions for the payment
or crediting of reasonable interest on installment or deferred payments or the
grant or crediting of Dividend Equivalents or other amounts in respect of
installment or deferred payments denominated in Stock.

         (d) Limitation on Vesting of Certain Awards. Subject to Section 8,
Restricted Stock will vest over a minimum period of three years except in the
event of a Participant's death, disability, or


                                     - 19 -
<PAGE>
retirement, or in the event of a Change in Control or other special
circumstances. The foregoing notwithstanding, (i) Restricted Stock as to which
either the grant or vesting is based on, among other things, the achievement of
one or more performance conditions generally will vest over a minimum period of
one year except in the event of a Participant's death, disability, or
retirement, or in the event of a Change in Control or other special
circumstances, and (ii) up to 5% of the shares of Stock authorized under the
Plan may be granted as Restricted Stock without any minimum vesting
requirements. For purposes of this Section 9(d), vesting over a three-year
period or one-year period will include periodic vesting over such period if the
rate of such vesting is proportional throughout such period.

10.      CHANGE IN CONTROL.

         (a) Effect of "Change in Control" on Non-Performance Based Awards. In
the event of a "Change in Control," the following provisions shall apply to
non-performance based Awards, including Awards as to which performance
conditions previously have been satisfied or are deemed satisfied under Section
10(b), unless otherwise provided by the Committee in the Award document:

                  (i) All deferral of settlement, forfeiture conditions and
         other restrictions applicable to Awards granted under the Plan shall
         lapse and such Awards shall be fully payable as of the time of the
         Change in Control without regard to deferral and vesting conditions,
         except to the extent of any waiver by the Participant or other express
         election to defer beyond a Change in Control and subject to applicable
         restrictions set forth in Section 12(a);

                  (ii) Any Award carrying a right to exercise that was not
         previously exercisable and vested shall become fully exercisable and
         vested as of the time of the Change in Control and shall remain
         exercisable and vested for the balance of the stated term of such Award
         without regard to any termination of employment or service by the
         Participant other than a termination for Cause, subject only to
         applicable restrictions set forth in Section 12(a); and

                  (iii) The Committee may, in its discretion, determine to
         extend to any Participant who holds an Option the right to elect,
         during the 60-day period immediately following the Change in Control,
         in lieu of acquiring the shares of Stock covered by such Option, to
         receive in cash the excess of the Change in Control Price over the
         exercise price of such Option, multiplied by the number of shares of
         Stock covered by such Option, and to extend to any Participant who
         holds other types of Awards denominated in shares the right to elect,
         during the 60-day period immediately following the Change in Control,
         in lieu of receiving the shares of Stock covered by such Award, to
         receive in cash the Change in Control Price multiplied by the number of
         shares of Stock covered by such Award.

         (b) Effect of "Change in Control" on Performance-Based Awards. In the
event of a "Change in Control," with respect to an outstanding Award subject to
achievement of performance goals and conditions, such performance goals and
conditions shall be deemed to be met or exceeded if and to the extent so
provided by the Committee in the Award document governing such Award or other
agreement with the Participant.

         (c) Definition of "Change in Control." A "Change in Control" shall be
deemed to have occurred if, after the Effective Date, there shall have occurred
any of the following:

                  (i) Any "person," as such term is used in Section 13(d) and
         14(d) of the Exchange Act (other than the Company, any trustee or other
         fiduciary holding securities under an employee benefit plan of the
         Company, or any company owned, directly or indirectly, by the
         shareholders of the Company in substantially the same proportions as
         their ownership of stock of the Company), acquires voting securities of
         the Company and immediately thereafter is a "20%


                                     - 20 -
<PAGE>
         Beneficial Owner." For purposes of this provision, a "20% Beneficial
         Owner" shall mean a person who is the "beneficial owner" (as defined in
         Rule 13d-3 under the Exchange Act), directly or indirectly, of
         securities of the Company representing 20% or more of the combined
         voting power of the Company's then-outstanding voting securities;
         provided that the term "20% Beneficial Owner" shall not include any
         person who, at all times following such an acquisition of securities,
         remains eligible to file a Schedule 13G pursuant to Rule 13d-1(b) under
         the Exchange Act, or remains exempt from filing a Schedule 13D under
         Section 13(d)(6)(b) of the Exchange Act, with respect to all classes of
         Company voting securities;

                  (ii) During any period of two consecutive years commencing on
         or after the Effective Date, individuals who at the beginning of such
         period constitute the Board, and any new director (other than a
         director designated by a person (as defined above) who has entered into
         an agreement with the Company to effect a transaction described in
         subsections (i), (iii) or (iv) of this definition) whose election by
         the Board or nomination for election by the Company's shareholders was
         approved by a vote of at least two-thirds (2/3) of the directors then
         still in office who either were directors at the beginning of the
         period or whose election or nomination for election was previously so
         approved (the "Continuing Directors") cease for any reason to
         constitute at least a majority thereof;

                  (iii) The shareholders of the Company have approved a merger,
         consolidation, recapitalization, or reorganization of the Company, or a
         reverse stock split of any class of voting securities of the Company,
         or the consummation of any such transaction if shareholder approval is
         not obtained, other than any such transaction which would result in at
         least 60% of the combined voting power of the voting securities of the
         Company or the surviving entity outstanding immediately after such
         transaction being beneficially owned by persons who together
         beneficially owned at least 80% of the combined voting power of the
         voting securities of the Company outstanding immediately prior to such
         transaction, with the relative voting power of each such continuing
         holder compared to the voting power of each other continuing holder not
         substantially altered as a result of the transaction; provided that,
         for purposes of this paragraph (iii), such continuity of ownership (and
         preservation of relative voting power) shall be deemed to be satisfied
         if the failure to meet such 60% threshold (or to substantially preserve
         such relative voting power) is due solely to the acquisition of voting
         securities by an employee benefit plan of the Company, such surviving
         entity or a subsidiary thereof; and provided further, that, if
         consummation of the corporate transaction referred to in this Section
         10(c)(iii) is subject, at the time of such approval by shareholders, to
         the consent of any government or governmental agency or approval of the
         shareholders of another entity or other material contingency, no Change
         in Control shall occur until such time as such consent and approval has
         been obtained and any other material contingency has been satisfied;

                  (iv) The shareholders of the Company have approved a plan of
         complete liquidation of the Company or an agreement for the sale or
         disposition by the Company of all or substantially all of the Company's
         assets (or any transaction having a similar effect); provided that, if
         consummation of the transaction referred to in this Section 10(c)(iv)
         is subject, at the time of such approval by shareholders, to the
         consent of any government or governmental agency or approval of the
         shareholders of another entity or other material contingency, no Change
         in Control shall occur until such time as such consent and approval has
         been obtained and any other material contingency has been satisfied;
         and

                  (v) any other event which the Board of Directors of the
         Company determines shall constitute a Change in Control for purposes of
         this Plan.

         (d) Definition of "Change in Control Price." The "Change in Control
Price" means an amount in cash equal to the higher of (i) the amount of cash and
fair market value of property that is the


                                     - 21 -
<PAGE>
highest price per share paid (including extraordinary dividends) in any
transaction triggering the Change in Control or any liquidation of shares
following a sale of substantially all assets of the Company, or (ii) the highest
Fair Market Value per share at any time during the 60-day period preceding and
60-day period following the Change in Control.

         (e) Termination of Employment After Change in Control Negotiations Have
Commenced. For purposes of this Section 10, a termination of a Participant's
employment by the Company without Cause after the commencement of negotiations
with a potential acquirer or business combination partner will be deemed to be a
termination of employment immediately after a Change in Control if such
negotiations result in a transaction constituting a Change in Control within 24
months of the commencement date of such negotiations.

11.      ADDITIONAL AWARD FORFEITURE PROVISIONS.

         (a) Forfeiture of Options and Other Awards and Gains Realized Upon
Prior Option Exercises or Award Settlements. Unless otherwise determined by the
Committee, each Award granted hereunder, other than Awards granted to
non-employee directors, shall be subject to the following additional forfeiture
conditions, to which the Participant, by accepting an Award hereunder, agrees.
If any of the events specified in Section 11(b)(i), (ii), or (iii) occurs (a
"Forfeiture Event"), all of the following forfeitures will result:

                  (i) The unexercised portion of the Option, whether or not
         vested, and any other Award not then settled (except for an Award that
         has not been settled solely due to an elective deferral by the
         Participant and otherwise is not forfeitable in the event of any
         termination of service of the Participant) will be immediately
         forfeited and canceled upon the occurrence of the Forfeiture Event; and

                  (ii) The Participant will be obligated to repay to the
         Company, in cash, within five business days after demand is made
         therefor by the Company, the total amount of Award Gain (as defined
         herein) realized by the Participant upon each exercise of an Option or
         settlement of an Award (regardless of any elective deferral) that
         occurred on or after (A) the date that is six months prior to the
         occurrence of the Forfeiture Event, if the Forfeiture Event occurred
         while the Participant was employed by the Company or a subsidiary or
         affiliate, or (B) the date that is six months prior to the date the
         Participant's employment by the Company or a subsidiary or affiliate
         terminated, if the Forfeiture Event occurred after the Participant
         ceased to be so employed. For purposes of this Section, the term "Award
         Gain" shall mean (i), in respect of a given Option exercise, the
         product of (X) the Fair Market Value per share of Stock at the date of
         such exercise (without regard to any subsequent change in the market
         price of shares) minus the exercise price times (Y) the number of
         shares as to which the Option was exercised at that date, and (ii), in
         respect of any other settlement of an Award granted to the Participant,
         the Fair Market Value of the cash or Stock paid or payable to
         Participant (regardless of any elective deferral) less any cash or the
         Fair Market Value of any Stock or property (other than an Award or
         award which would have itself then been forfeitable hereunder and
         excluding any payment of tax withholding) paid by the Participant to
         the Company as a condition of or in connection such settlement.

         (b) Events Triggering Forfeiture. The forfeitures specified in Section
11(a) will be triggered upon the occurrence of any one of the following
Forfeiture Events at any time during the Participant's employment by the Company
or a subsidiary or affiliate and resulting in his or her termination of
employment, or during the one-year period following termination of such
employment:

                  (i) The Participant, acting alone or with others, directly or
         indirectly, prior to a Change in Control, (A) engages, either as
         employee, employer, consultant, advisor, or director, or as an


                                     - 22 -
<PAGE>
         owner, investor, partner, or stockholder unless the Participant's
         interest is insubstantial, in any business in an area or region in
         which the Company conducts business at the date the event occurs, which
         is directly in competition with a business then conducted by the
         Company or a subsidiary or affiliate; (B) induces any customer or
         supplier of the Company or a subsidiary or affiliate, or telephone
         company with which the Company or a subsidiary or affiliate has a
         business relationship, to curtail, cancel, not renew, or not continue
         his or her or its business with the Company or any subsidiary or
         affiliate; or (C) induces, or attempts to influence, any employee of or
         service provider to the Company or a subsidiary or affiliate to
         terminate such employment or service. The Committee shall, in its
         discretion, determine which lines of business the Company conducts on
         any particular date and which third parties may reasonably be deemed to
         be in competition with the Company. For purposes of this Section
         11(b)(i), a Participant's interest as a stockholder is insubstantial if
         it represents beneficial ownership of less than five percent of the
         outstanding class of stock, and a Participant's interest as an owner,
         investor, or partner is insubstantial if it represents ownership, as
         determined by the Committee in its discretion, of less than five
         percent of the outstanding equity of the entity;

                  (ii) The Participant discloses, uses, sells, or otherwise
         transfers, except in the course of employment with or other service to
         the Company or any subsidiary or affiliate, any confidential or
         proprietary information of the Company or any subsidiary or affiliate,
         including but not limited to information regarding the Company's
         current and potential customers, organization, employees, finances, and
         methods of operations and investments, so long as such information has
         not otherwise been disclosed to the public or is not otherwise in the
         public domain, except as required by law or pursuant to legal process,
         or the Participant makes statements or representations, or otherwise
         communicates, directly or indirectly, in writing, orally, or otherwise,
         or takes any other action which may, directly or indirectly, disparage
         or be damaging to the Company or any of its subsidiaries or affiliates
         or their respective officers, directors, employees, advisors,
         businesses or reputations, except as required by law or pursuant to
         legal process; or

                  (iii) The Participant fails to cooperate with the Company or
         any subsidiary or affiliate in any way, including, without limitation,
         by making himself or herself available to testify on behalf of the
         Company or such subsidiary or affiliate in any action, suit, or
         proceeding, whether civil, criminal, administrative, or investigative,
         or otherwise fails to assist the Company or any subsidiary or affiliate
         in any way, including, without limitation, in connection with any such
         action, suit, or proceeding by providing information and meeting and
         consulting with members of management of, other representatives of, or
         counsel to, the Company or such subsidiary or affiliate, as reasonably
         requested.

         (c) Agreement Does Not Prohibit Competition or Other Participant
Activities. Although the conditions set forth in this Section 11 shall be deemed
to be incorporated into an Award, a Participant is not thereby prohibited from
engaging in any activity, including but not limited to competition with the
Company and its subsidiaries and affiliates. Rather, the non-occurrence of the
Forfeiture Events set forth in Section 11(b) is a condition to the Participant's
right to realize and retain value from his or her compensatory Options and
Awards, and the consequence under the Plan if the Participant engages in an
activity giving rise to any such Forfeiture Event are the forfeitures specified
herein. The Company and the Participant shall not be precluded by this provision
or otherwise from entering into other agreements concerning the subject matter
of Sections 11(a) and 11(b).

         (d) Committee Discretion. The Committee may, in its discretion, waive
in whole or in part the Company's right to forfeiture under this Section, but no
such waiver shall be effective unless evidenced by a writing signed by a duly
authorized officer of the Company. In addition, the Committee may impose
additional conditions on Awards, by inclusion of appropriate provisions in the
document evidencing or governing any such Award.

                                     - 23 -
<PAGE>
12.      GENERAL PROVISIONS.

         (a) Compliance with Legal and Other Requirements. The Company may, to
the extent deemed necessary or advisable by the Committee, postpone the issuance
or delivery of Stock or payment of other benefits under any Award until
completion of such registration or qualification of such Stock or other required
action under any federal or state law, rule or regulation, listing or other
required action with respect to any stock exchange or automated quotation system
upon which the Stock or other securities of the Company are listed or quoted, or
compliance with any other obligation of the Company, as the Committee may
consider appropriate, and may require any Participant to make such
representations, furnish such information and comply with or be subject to such
other conditions as it may consider appropriate in connection with the issuance
or delivery of Stock or payment of other benefits in compliance with applicable
laws, rules, and regulations, listing requirements, or other obligations. The
foregoing notwithstanding, in connection with a Change in Control, the Company
shall take or cause to be taken no action, and shall undertake or permit to
arise no legal or contractual obligation, that results or would result in any
postponement of the issuance or delivery of Stock or payment of benefits under
any Award or the imposition of any other conditions on such issuance, delivery
or payment, to the extent that such postponement or other condition would
represent a greater burden on a Participant than existed on the 90th day
preceding the Change in Control.

         (b) Limits on Transferability; Beneficiaries. No Award or other right
or interest of a Participant under the Plan shall be pledged, hypothecated or
otherwise encumbered or subject to any lien, obligation or liability of such
Participant to any party (other than the Company or a subsidiary or affiliate
thereof), or assigned or transferred by such Participant otherwise than by will
or the laws of descent and distribution or to a Beneficiary upon the death of a
Participant, and such Awards or rights that may be exercisable shall be
exercised during the lifetime of the Participant only by the Participant or his
or her guardian or legal representative, except that Awards and other rights
(other than ISOs and SARs in tandem therewith) may be transferred to one or more
transferees during the lifetime of the Participant, and may be exercised by such
transferees in accordance with the terms of such Award, but only if and to the
extent such transfers are permitted by the Committee, subject to any terms and
conditions which the Committee may impose thereon (including limitations the
Committee may deem appropriate in order that offers and sales under the Plan
will meet applicable requirements of registration forms under the Securities Act
of 1933 specified by the Securities and Exchange Commission). A Beneficiary,
transferee, 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 document applicable to such Participant, except as otherwise determined by
the Committee, and to any additional terms and conditions deemed necessary or
appropriate by the Committee.

         (c) Adjustments. In the event that any large, special and non-recurring
dividend or other distribution (whether in the form of cash or property other
than Stock), recapitalization, forward or reverse split, Stock dividend,
reorganization, merger, consolidation, spin-off, combination, repurchase, share
exchange, liquidation, dissolution or other similar corporate transaction or
event affects the Stock such that an adjustment is determined by the Committee
to be appropriate under the Plan, then the Committee shall, in such manner as it
may deem equitable, adjust any or all of (i) the number and kind of shares of
Stock which may be delivered in connection with Awards granted thereafter, (ii)
the number and kind of shares of Stock by which annual per-person Award
limitations are measured under Section 5, (iii) the number and kind of shares of
Stock subject to or deliverable in respect of outstanding Awards and (iv) the
exercise price, grant price or purchase price relating to any Award or, if
deemed appropriate, the Committee may make provision for a payment of cash or
property to the holder of an outstanding Option (subject to Section 12(k)). In
addition, the Committee is authorized to make adjustments in the terms and
conditions of, and the criteria included in, Awards (including Performance
Awards and performance goals and any hypothetical funding pool relating


                                     - 24 -
<PAGE>
thereto) in recognition of unusual or nonrecurring events (including, without
limitation, events described in the preceding sentence, as well as acquisitions
and dispositions of businesses and assets) affecting the Company, any subsidiary
or affiliate or other business unit, or the financial statements of the Company
or any subsidiary or affiliate, or in response to changes in applicable laws,
regulations, accounting principles, tax rates and regulations or business
conditions or in view of the Committee's assessment of the business strategy of
the Company, any subsidiary or affiliate or business unit thereof, performance
of comparable organizations, economic and business conditions, personal
performance of a Participant, and any other circumstances deemed relevant;
provided that no such adjustment shall be authorized or made if and to the
extent that the existence of such authority (i) would cause Options, SARs, or
Performance Awards granted under the Plan to Participants designated by the
Committee as Covered Employees and intended to qualify as "performance-based
compensation" under Code Section 162(m) and regulations thereunder to otherwise
fail to qualify as "performance-based compensation" under Code Section 162(m)
and regulations thereunder, or (ii) would cause the Committee to be deemed to
have authority to change the targets, within the meaning of Treasury Regulation
1.162-27(e)(4)(vi), under the performance goals relating to Options or SARs
granted to Covered Employees and intended to qualify as "performance-based
compensation" under Code Section 162(m) and regulations thereunder.

         (d) Tax Provisions.

                  (i) Withholding. The Company and any subsidiary or affiliate
         is authorized to withhold from any Award granted, any payment relating
         to an Award under the Plan, including from a distribution of Stock, or
         any payroll or other payment to a Participant, amounts of withholding
         and other taxes due or potentially payable in connection with any
         transaction involving an Award, and to take such other action as the
         Committee may deem advisable to enable the Company and Participants to
         satisfy obligations for the payment of withholding taxes and other tax
         obligations relating to any Award. This authority shall include
         authority to withhold or receive Stock or other property and to make
         cash payments in respect thereof in satisfaction of a Participant's
         withholding obligations, either on a mandatory or elective basis in the
         discretion of the Committee. Other provisions of the Plan
         notwithstanding, only the minimum amount of Stock deliverable in
         connection with an Award necessary to satisfy statutory withholding
         requirements will be withheld.

                  (ii) Required Consent to and Notification of Code Section
         83(b) Election. No election under Section 83(b) of the Code (to include
         in gross income in the year of transfer the amounts specified in Code
         Section 83(b)) or under a similar provision of the laws of a
         jurisdiction outside the United States may be made unless expressly
         permitted by the terms of the Award document or by action of the
         Committee in writing prior to the making of such election. In any case
         in which a Participant is permitted to make such an election in
         connection with an Award, the Participant shall notify the Company of
         such election within ten days of filing notice of the election with the
         Internal Revenue Service or other governmental authority, in addition
         to any filing and notification required pursuant to regulations issued
         under Code Section 83(b) or other applicable provision.

                  (iii) Requirement of Notification Upon Disqualifying
         Disposition Under Code Section 421(b). If any Participant shall make
         any disposition of shares of Stock delivered pursuant to the exercise
         of an Incentive Stock Option under the circumstances described in Code
         Section 421(b), such Participant shall notify the Company of such
         disposition within ten days thereof.

         (e) Changes to the Plan. The Board may amend, suspend or terminate the
Plan or the Committee's authority to grant Awards under the Plan without the
consent of stockholders or Participants; provided, however, that any amendment
to the Plan shall be submitted to the Company's stockholders for approval not
later than the earliest annual meeting for which the record


                                     - 25 -
<PAGE>
date is after the date of such Board action if such stockholder approval is
required by any federal or state law or regulation or the rules of any stock
exchange or automated quotation system on which the Stock may then be listed or
quoted, or if such amendment would:

                  (i) materially increase the number of shares reserved for
         issuance and delivery under Section 4 of the Plan;

                  (ii) expand the class of Eligible Persons under Section 5(a)
         of the Plan;

                  (iii) increase the per-person Annual Limits under Section 5(b)
         of the Plan;

                  (iv) increase the number of shares that may be issued and
         delivered under the Plan in connection with awards other than Options
         and SARs under Section 4(a) of the Plan;

                  (v) permit unrestricted Stock to be granted other than in lieu
         of such payments under the Plan or other incentive plans and programs
         of the Company and its subsidiaries and affiliates;

                  (vi) allow for the creation of additional types of awards;

                  (vii) with respect to Restricted Stock, permit shortening or
         lapsing of restrictions or waiving of performance goals, except to the
         extent specified in Section 9(d) of the Plan;

                  (viii) amend or replace previously granted Options in a
         transaction that constitutes a "repricing," as such term is used in
         Instruction 3 to Item 402(b)(2)(iv) of Regulation S-K, as promulgated
         by the Securities and Exchange Commission; or

                  (ix) amend any of the terms and conditions of this Section
         12(e);

and the Board may otherwise, in its discretion, determine to submit other
amendments to the Plan to stockholders for approval. In addition, without the
consent of an affected Participant, no such Board action may materially and
adversely affect the rights of such Participant under any outstanding Award,
except any such amendment made to cause the Plan to comply with applicable law,
stock exchange rules and regulations or accounting or tax rules and regulations.
With regard to other terms of Awards, the Committee shall have no authority to
waive or modify any such Award term after the Award has been granted to the
extent the waived or modified term would be mandatory under the Plan for any
Award newly granted at the date of the waiver or modification

         (f) Right of Setoff. The Company or any subsidiary or affiliate may, to
the extent permitted by applicable law, deduct from and set off against any
amounts the Company or a subsidiary or affiliate may owe to the Participant from
time to time, including amounts payable in connection with any Award, owed as
wages, fringe benefits, or other compensation owed to the Participant, such
amounts as may be owed by the Participant to the Company, including but not
limited to amounts owed under Section 11(a), although the Participant shall
remain liable for any part of the Participant's payment obligation not satisfied
through such deduction and setoff. By accepting any Award granted hereunder, the
Participant agrees to any deduction or setoff under this Section 12(f).

         (g) Unfunded Status of Awards; Creation of Trusts. The Plan is intended
to constitute an "unfunded" plan for incentive and deferred compensation. With
respect to any payments not yet made to a Participant or obligation to deliver
Stock pursuant to an Award, nothing contained in the Plan or any Award shall
give any such Participant any rights that are greater than those of a general
creditor of the Company; provided that the Committee may authorize the creation
of trusts and deposit therein cash, Stock, other Awards or other property, or
make other arrangements to meet the


                                     - 26 -
<PAGE>
Company's obligations under the Plan. Such trusts or other arrangements shall be
consistent with the "unfunded" status of the Plan unless the Committee otherwise
determines with the consent of each affected Participant.

         (h) Nonexclusivity of the Plan. Neither the adoption of the Plan by the
Board nor its submission to the stockholders of the Company for approval shall
be construed as creating any limitations on the power of the Board or a
committee thereof to adopt such other incentive arrangements, apart from the
Plan, as it may deem desirable, including incentive arrangements and awards
which do not qualify under Code Section 162(m), and such other arrangements may
be either applicable generally or only in specific cases.

         (i) Payments in the Event of Forfeitures; Fractional Shares. Unless
otherwise determined by the Committee, in the event of a forfeiture of an Award
with respect to which a Participant paid cash consideration, the Participant
shall be repaid the amount of such cash consideration. No fractional shares of
Stock shall be issued or delivered pursuant to the Plan or any Award. The
Committee shall determine whether cash, other Awards or other property shall be
issued or paid in lieu of such fractional shares or whether such fractional
shares or any rights thereto shall be forfeited or otherwise eliminated.

         (j) Compliance with Code Section 162(m). It is the intent of the
Company that Options and SARs granted to Covered Employees and other Awards
designated as Awards to Covered Employees subject to Section 7 shall constitute
qualified "performance-based compensation" within the meaning of Code Section
162(m) and regulations thereunder, unless otherwise determined by the Committee
at the time of allocation of an Award. Accordingly, the terms of Sections 7(b),
(c), and (d), including the definitions of Covered Employee and other terms used
therein, shall be interpreted in a manner consistent with Code Section 162(m)
and regulations thereunder. The foregoing notwithstanding, because the Committee
cannot determine with certainty whether a given Participant will be a Covered
Employee with respect to a fiscal year that has not yet been completed, the term
Covered Employee as used herein shall mean only a person designated by the
Committee as likely to be a Covered Employee with respect to a specified fiscal
year. If any provision of the Plan or any Award document relating to a
Performance Award that is designated as intended to comply with Code Section
162(m) does not comply or is inconsistent with the requirements of Code Section
162(m) or regulations thereunder, such provision shall be construed or deemed
amended to the extent necessary to conform to such requirements, and no
provision shall be deemed to confer upon the Committee or any other person
discretion to increase the amount of compensation otherwise payable in
connection with any such Award upon attainment of the applicable performance
objectives.

         (k) Certain Limitations Relating to Accounting Treatment of Awards.
Other provisions of the Plan notwithstanding, the Committee's authority under
the Plan (including under Sections 9(c), 12(c) and 12(d)) is limited to the
extent necessary to ensure that any Option or other Award of a type that the
Committee has intended to be subject to fixed accounting with a measurement date
at the date of grant or the date performance conditions are satisfied under APB
25 shall not become subject to "variable" accounting solely due to the existence
of such authority, unless the Committee specifically determines that the Award
shall remain outstanding despite such "variable" accounting. In addition, other
provisions of the Plan notwithstanding, (i) if any right under this Plan would
cause a transaction to be ineligible for pooling-of-interests accounting that
would, but for the right hereunder, be eligible for such accounting treatment,
such right shall be automatically adjusted so that pooling-of-interests
accounting shall be available, including by substituting Stock or cash having a
Fair Market Value equal to any cash or Stock otherwise payable in respect of any
right to cash which would cause the transaction to be ineligible for
pooling-of-interests accounting, and (ii) if any authority under Section 10
would cause a transaction to be ineligible for pooling-of-interests accounting
that would, but for


                                     - 27 -
<PAGE>
such authority, be eligible for such accounting treatment, such authority shall
be limited to the extent necessary so that such transaction would be eligible
for pooling-of-interests accounting.

         (l) Governing Law. The validity, construction, and effect of the Plan,
any rules and regulations relating to the Plan and any Award document shall be
determined in accordance with the laws of the State of Delaware, without giving
effect to principles of conflicts of laws, and applicable provisions of federal
law.

         (m) Awards to Participants Outside the United States. The Committee may
modify the terms of any Award under the Plan made to or held by a Participant
who is then resident or primarily employed outside of the United States in any
manner deemed by the Committee to be necessary or appropriate in order that such
Award shall conform to laws, regulations, and customs of the country in which
the Participant is then resident or primarily employed, or so that the value and
other benefits of the Award to the Participant, as affected by foreign tax laws
and other restrictions applicable as a result of the Participant's residence or
employment abroad shall be comparable to the value of such an Award to a
Participant who is resident or primarily employed in the United States. An Award
may be modified under this Section 12(m) in a manner that is inconsistent with
the express terms of the Plan, so long as such modifications will not contravene
any applicable law or regulation or result in actual liability under Section
16(b) for the Participant whose Award is modified.

         (n) Limitation on Rights Conferred under Plan. Neither the Plan nor any
action taken hereunder shall be construed as (i) giving any Eligible Person or
Participant the right to continue as an Eligible Person or Participant or in the
employ or service of the Company or a subsidiary or affiliate, (ii) interfering
in any way with the right of the Company or a subsidiary or affiliate to
terminate any Eligible Person's or Participant's employment or service at any
time (subject to the terms and provisions of any separate written agreements),
(iii) giving an Eligible Person or Participant any claim to be granted any Award
under the Plan or to be treated uniformly with other Participants and employees,
or (iv) conferring on a Participant any of the rights of a stockholder of the
Company unless and until the Participant is duly issued or transferred shares of
Stock in accordance with the terms of an Award or an Option is duly exercised.
Except as expressly provided in the Plan and an Award document, neither the Plan
nor any Award document shall confer on any person other than the Company and the
Participant any rights or remedies thereunder.

         (o) Severability; Entire Agreement. If any of the provisions of this
Plan or any Award document is finally held to be invalid, illegal or
unenforceable (whether in whole or in part), such provision shall be deemed
modified to the extent, but only to the extent, of such invalidity, illegality
or unenforceability, and the remaining provisions shall not be affected thereby;
provided, that, if any of such provisions is finally held to be invalid,
illegal, or unenforceable because it exceeds the maximum scope determined to be
acceptable to permit such provision to be enforceable, such provision shall be
deemed to be modified to the minimum extent necessary to modify such scope in
order to make such provision enforceable hereunder. The Plan and any Award
documents contain the entire agreement of the parties with respect to the
subject matter thereof and supersede all prior agreements, promises, covenants,
arrangements, communications, representations and warranties between them,
whether written or oral with respect to the subject matter thereof.


                                     - 28 -
<PAGE>
         (p) Plan Effective Date and Termination. The Plan shall become
effective if, and at such time as, the stockholders of the Company have approved
it by the affirmative votes of the holders of a majority of the voting
securities of the Company present, or represented, and entitled to vote on the
subject matter at a duly held meeting of stockholders. Upon such approval of the
Plan by the stockholders of the Company, no further awards shall be granted
under the Preexisting Plans, but any outstanding awards under the Preexisting
Plans shall continue in accordance with their terms. Any elections made by
non-employee directors and their respective Deferral Accounts established
pursuant to the 1998 Directors' Stock Plan shall continue as if made or
established pursuant to the Plan until any such election is changed by such
Participant in accordance with the provisions of this Plan. Unless earlier
terminated by action of the Board of Directors, the Plan will remain in effect
until such time as no Stock remains available for delivery under the Plan and
the Company has no further rights or obligations under the Plan with respect to
outstanding Awards under the Plan.


                                     - 29 -