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                          AGREEMENT

     This Agreement made as of this 1st day of January , 1995
by and between Dravo Corporation, a Pennsylvania corporation
(the "Corporation") and Donald H. Stowe, Jr., an individual
residing in the State of Pennsylvania and an employee of the
Corporation (the "Executive").

                         WITNESSETH:

     WHEREAS, the Board of Directors of the Corporation has
determined that it is in the best interests of the
Corporation to enter into this Agreement with the Executive;
and

     WHEREAS, the Executive desires to obtain certain
benefits in the event his employment is terminated due to a
Change-in-Control of the Corporation;

     NOW, THEREFORE, the parties hereto, each intending to be
legally bound hereby, agree as follows:

1.      Definition of Terms.  The following terms when used
   in this Agreement shall have the meaning hereafter set
   forth:

    (a)      "Annual Salary Adjustment Percentage" shall mean
        the mean average percentage increase in base salary
        for all elected officers of the Corporation during
        the two full calendar years immediately preceding the
        time to which such percentage is being applied;
        provided, however, that if after a Change-in-Control,
        as hereinafter defined, there should be a significant
        change in the number of elected officers of the
        Corporation or in the manner in which they are
        compensated, then the foregoing definition shall be
        changed by substituting for the phrase "elected
        officers of the Corporation" the phrase "persons then
        performing the functions formerly performed by the
        elected officers of the Corporation."
   
    (b)      "Cause for Termination" shall mean
   
        (i)     the deliberate and intentional failure by
            the Executive to devote substantially his entire
            business time and best efforts to the performance
            of his duties (other than any such failure
            resulting from the Executive's incapacity due to
            physical or mental illness or disability) after a
            demand for substantial performance is delivered
            to the Executive by the Board of Directors of the
            Corporation which specifically identifies the
            manner in which the Board believes that the
            Executive has not substantially performed his
            duties,
        or
        
        (ii)    the deliberate and intentional engaging by
            the Executive in gross misconduct materially and
            demonstrably injurious to the Corporation.
        
        For purposes of this definition, no act, or failure
        to act, on the Executive's part shall be considered
        "deliberate and intentional" unless done, or omitted
        to be done, by the Executive not in good faith and
        without reasonable belief that his action or omission
        was in the best interests of the Corporation.

   (c)  "Change-in-Control" shall mean a change in control of
        the Corporation of such a nature that it would be
        required to be reported by the Corporation in
        response to item 6(e) of Schedule 14A of Regulation
        14A promulgated under the Securities Exchange Act of
        1934, as in effect on the date hereof ("Exchange
        Act"); provided, however, that without respect to the
        foregoing, such a change in control shall be deemed
        to have occurred if
   
        (i)     any "person" (as such term is used in
            Sections 13(d) and 14(d)(2) of the Exchange Act)
            is or becomes the beneficial owner, directly or
            indirectly, of securities of the Corporation
            representing 20% or more of the combined voting
            power of the Corporation's then outstanding
            securities;
        
         or
        
        (ii)    during any period of three consecutive
            years, individuals who at the beginning of such
            period constitute the Board of Directors of the
            Corporation (the "Board") cease for any reason to
            constitute at least a Majority thereof unless the
            election, or the nomination for election by the
            Corporation's shareholders, of each new director
            was approved by a vote of at least two-thirds of
            the directors then still in office who were
            directors at the beginning of the period.

    (d)      "Date of Termination" shall mean
   
              (i)  if the Executive's employment is
               terminated for Disability, thirty (30) days
               after a Notice of Termination is given to the
               Executive (provided that the Executive shall
               not have returned to the performance of the
               Executive's duties on a full time basis during
               such thirty (30) day period);
        
              (ii)      if the Executive's employment
               terminates due to his death or Retirement, the
               date of death or Retirement, respectively;
        
              (iii)     if the Executive terminates
               employment upon Good Reason for Termination,
               the date specified for termination in any
               notice delivered to the Corporation by the
               Executive; or
        
              (iv) if the Executive's employment is
               terminated for any other reason, the date on
               which a termination becomes effective pursuant
               to a Notice of Termination; provided, however,
               that if within thirty (30) days after any
               Notice of Termination is given the party
               receiving such Notice of Termination notifies
               the other party that a dispute exists
               concerning the termination, the Date of
               Termination shall be the date on which the
               dispute is finally determined, either by
               mutual written agreement of the parties, by a
               binding and final arbitration award or by a
               final judgment, order or decree of a court of
               competent jurisdiction (the time for appeal
               therefrom having expired and no appeal having
               been perfected).
   
   (e)  "Disability" shall mean such incapacity due to
        physical or mental illness or injury as causes the
        Executive to be absent from his principal office for
        the entire portion of 90 consecutive business days.
   
    (f)      "Good Reason for Termination" shall mean:
   
              (i)  without the Executive's express written
               consent, the assignment to the Executive of
               any duties inconsistent with his positions,
               duties, responsibilities and status with the
               Corporation immediately prior to a Change-in-
               Control, or a change in his reporting
               responsibilities, titles or offices as in
               effect immediately prior to a Change-in-
               Control, or any removal of the executive from
               or any failure to re-elect the Executive to
               any of such positions, except in connection
               with the termination of the Executive's
               employment due to a Cause for Termination,
               Disability or Retirement (as hereinafter
               defined) or as a result of the Executive's
               death;
        
              (ii)      a reduction by the Corporation in
               the Executive's base salary as in effect
               immediately prior to the Change-in-Control or
               as the same may be increased from time to time
               or the failure by the Corporation to increase
               such base salary each year after the year in
               which the Change-in-Control occurs by an
               amount which at least equals, on a percentage
               basis, the Annual Salary Adjustment
               Percentage;
              (iii)     a failure by the Corporation to
               continue to provide incentive compensation
               comparable to that provided by the
               Corporation's Incentive Compensation Plan as
               the same may from time to time prior to a
               Change-in-Control be modified or superseded by
               another plan (the "Incentive Compensation
               Plan"), or a failure by the Corporation to
               continue the Executive as a participant in the
               Incentive Compensation Plan on at least the
               basis and according to the standards in effect
               immediately prior to the Change-in-Control or
               to pay the Executive when due any deferred
               portion of a previous award under the
               Incentive Compensation Plan;
        
              (iv)      the Corporation's requiring the
               Executive to be based anywhere other than the
               Corporation's executive offices at which the
               Executive has his principal office immediately
               prior to the Change-in-Control, except for
               required travel on the Corporation's business
               to an extent substantially consistent with the
               Executive's present business travel
               obligations immediately prior to the Change-in-
               Control, or, in the event the Executive
               consents to any such relocation of the
               Corporation's principal executive offices, the
               failure by the Corporation to pay (or
               reimburse the Executive for) all reasonable
               moving expenses incurred by the Executive
               relating to a change of the Executive's
               principal residence in connection with such
               relocation and to indemnify the Executive
               against any loss (defined as the difference
               between the actual sale price of such
               residence and the higher of (a) the
               Executive's aggregate investment in such
               residence or (b) the fair market value of such
               residence as determined by a real estate
               appraiser designated by the Executive and
               reasonably satisfactory to the Corporation)
               realized in the sale of the Executive's
               principal residence in connection with any
               such change of residence;
        
              (v)  the failure by the Corporation to
               continue in effect any benefit or compensation
               plan (including but not limited to the
               Corporation's Long-Term Incentive Award Plan
               of 1983, Stock Option Plan of 1978, Employee
               Stock Option Plan of 1988, Stock Option Plan
               of 1994, and the Executive Benefit Plan),
               pension plan, life insurance plan, health and
               accident plan or disability plan in which the
               Executive is participating immediately prior
               to the Change-in-Control (provided, however,
               that there shall not be deemed to be any such
               failure if the Corporation substitutes for the
               discontinued plan, a plan providing the
               Executive with substantially similar
               benefits), the taking of any action by the
               Corporation which would adversely affect the
               Executive's participation in or materially
               reduce the Executive's benefits under any of
               such plans or deprive the Executive of any
               material fringe benefit enjoyed by the
               Executive immediately prior to the Change-in-
               Control, or the failure by the Corporation to
               provide the Executive with the number of paid
               vacation days to which the Executive is then
               entitled on the basis of years of service with
               the Corporation in accordance with the
               Corporation's normal vacation policy all as
               and to the extent they are in effect
               immediately prior to the Change-in-Control;
        
              (vi)      the failure of the Corporation to
               obtain the assumption of this Agreement by any
               successor as contemplated in Section 9(c)
               hereof; or
        
              (vii)     any purported termination of the
               employment of the Executive by the Corporation
               which is not (A) due to the Executive's
               Disability, death, Retirement (as hereinafter
               defined) or in accordance with section 2
               hereof, or (B) effected pursuant to a Notice
               of Termination satisfying the requirements of
               subsection (g) below;
        
              (viii)    notwithstanding the foregoing, it
               shall not be deemed Good Reason for
               Termination if the Corporation, acting in good
               faith, makes changes to any compensation or
               benefits plan or program that is made
               available on a nondiscriminatory basis to the
               salaried employees of the Corporation, which
               changes do not apply disproportionately to the
               elected officers of the Corporation or those
               persons then performing the functions formerly
               performed by the elected officers of the
               Corporation.
        
   (g)  "Notice of Termination" shall mean a written
        statement which sets forth the specific reason for
        termination and, if such is claimed to be Cause for
        Termination, in reasonable detail the facts and
        circumstances which indicate that such is Cause for
        Termination together with notice of the time and
        place of the meeting of the Board of Directors of the
        Corporation called to consider such matter in
        accordance with section 2 hereof.

    (h)      "Options" shall mean any stock options issued
        pursuant to the Corporation's Employee Stock Option
        Plan of 1988, Long-Term Incentive Award Plan of 1983,
        Stock Option Plan of 1978 or any future stock option
        plan.
    (i)      "Retirement" shall mean a termination of the
        Executive's employment after age 65 or in accordance
        with any mandatory retirement arrangement with
        respect to an earlier age agreed to by the Executive.
   
   (j)  "Stock Appreciation Rights" shall mean any stock
        appreciation rights issued pursuant to the
        Corporation's Employee Stock Option Plan of 1988,
        Long-Term Incentive Award Plan of 1983, Stock Option
        Plan of 1978 or any future stock appreciation rights
        plan.

2.      "Termination by the Corporation Due to Cause for
   Termination."
   If the Corporation desires to terminate the Executive's
   employment due to Cause for Termination, the Corporation
   shall first deliver a Notice of Termination to the
   Executive.  Thereafter, the Board of Directors at a
   meeting held not less than two weeks nor more than four
   weeks after the delivery of the Notice Of Termination
   shall consider whether cause for Termination exists.
   Cause for Termination shall not be deemed to exist under
   this Agreement unless and until the Board determines in
   good faith by the affirmative vote of not less than three-
   quarters of the entire membership of the Board that the
   Executive has engaged in conduct which is Cause for
   Termination.  Should the Board determine that Cause for
   Termination exists, the Board may at that time or during a
   period of two weeks thereafter terminate the Executive's
   employment due to Cause for Termination by adopting at
   such time or during such period by a similar three-
   quarters vote a resolution terminating the Executive's
   employment. If the Board fails to adopt within such two-
   week period a resolution terminating the Executive's
   employment, then the Corporation shall be deemed to have
   waived its right to terminate the Executive due to those
   circumstances which constituted the Cause for Termination
   previously found to exist by the Board.

 3.     Termination Payments Following Change-in-Control.

    (a)      If, during the term of this Agreement, a Change-
        in-Control shall have occurred and the Executive's
        employment with the Corporation shall be terminated

              (i)  due to the Executive's death,
        
              (ii)      by the Executive unless terminated
               for Good Reason for Termination, or
        
              (iii)     by the Corporation in accordance
               with section 2 hereof or for Disability or
               Retirement, then the Corporation shall have no
               obligations hereunder to the Executive and the
               only obligations of the  Corporation to the
               Executive shall be in accordance with any
               other employment agreement applicable to the
               Executive and the then various policies,
               practices and benefit plans of the
               Corporation.
   
   (b)  If during the term of this Agreement both a Change-in-
        Control shall have occurred and the Executive's
        employment with the Corporation shall have terminated
        other than under the circumstances above described in
        Subsection 3(a), then the Corporation shall pay or
        cause to be paid on or before the fifth day following
        the Date of Termination in cash to the Executive the
        following sums:
        
              (i)  any unpaid portion of the Executive's
               full base salary for the period from the last
               period for which the Executive was paid to the
               Date of Termination;
        
              (ii)      any then deferred portions of cash
               awards (including deferred awards which but
               for this provision would not be payable until
               subsequent to the Date of Termination) made to
               the Executive under the Executive incentive
               Compensation Plan; and
        
              (iii)     an amount as liquidated damages for
               lost future remuneration equal to the product
               obtained by multiplying

               (A)  the lesser of
                  
                    (1)     three or
                    
                    (2)     a number equal to the number of
                       calendar months remaining from the
                       Date of Termination to the date on
                       which the Executive is 65 years of age
                       (or, if earlier, the age agreed to by
                       the Executive pursuant to any prior
                       arrangement) divided by twelve
                    
                     times
             
                (B)      the sum of

                    (1)     the greater of
                  
                       (i)     the Executive's base salary
                           for the year in effect on the Date
                           of Termination (provided that in
                           the case of Termination for Good
                           Reason by the Executive the date
                           immediately preceding the date of
                           the earliest event which gave rise
                           to the Termination for Good Reason
                           by the Executive shall be used
                           instead of the Date of
                           Termination)
                       
                          or
                       
                       (ii)    the Executive's base salary
                           for the year in effect on the date
                           of the Change-in-Control;
                       
                       provided that "base salary for the
                       year" shall be the amount of base
                       salary for the year established by the
                       Board of Directors at the beginning of
                       the fiscal year in question in
                       accordance with the compensation
                       policies and practices of the
                       Corporation, without regard to any
                       reduction in the amount actually paid
                       to the Executive during such year as a
                       result of any plan of the Corporation
                       to reduce compensation due to economic
                       considerations, and without regard to
                       any deferral of compensation payable
                       to the Executive for services rendered
                       during such year to a subsequent year.

                     plus
                    
                    (2)     the greater of
                  
                       (i)     the average annual cash award
                           received by the Executive under
                           the Executive Incentive
                           Compensation Plan for the two
                           calendar years immediately
                           preceding the Date of Termination
                           (provided that in the case of
                           Termination for Good Reason by the
                           Executive the date immediately
                           preceding the date of the event
                           which gave rise to the Termination
                           for Good Reason by the Executive
                           shall be used instead of the Date
                           of Termination;
                       
                        or
                       (ii)    the average annual cash award
                           received by the Executive under
                           the Incentive Compensation Plan
                           for the two calendar years
                           immediately preceding the date of
                           the Change-in-Control.

   (c)  Notwithstanding any other provisions of this
        Agreement, in the event that any payment or benefit
        received or to be received by the Executive pursuant
        to the terms of this Agreement or otherwise
        (collectively the "Total Payments") would not be
        deductible, in whole or part, as a result of section
        280G of the Internal Revenue Code of 1986, as amended
        (the "Code") by the Corporation, an affiliate or
        other person making such payment or providing such
        benefit, the payments due under this Agreement (the
        "Contract Payments") shall be reduced until no
        portion of the Total Payments is not deductible, or
        the Contract Payments are reduced to zero.  For
        purposes of this limitation (i) no portion of the
        Total Payments the receipt or enjoyment of which you
        shall have effectively waived in writing prior to the
        date of payment of the Contract Payments shall be
        taken into account, (ii) no portion of the Total
        Payments shall be taken into account which in the
        opinion of tax counsel selected by the Corporation's
        independent auditors and acceptable to you does not
        constitute a "parachute payment" within the meaning
        of section 280G(b)(2) of the Code, (iii) the Contract
        Payments shall be reduced only to the extent
        necessary so that the Total Payments (other than
        those referred to in clauses (i) or (ii) in their
        entirety constitute reasonable compensation for
        services actually rendered within the meaning of
        section 280G(b)(4) of the Code or are otherwise not
        subject to disallowance as deductions, in the opinion
        of the tax counsel referred to in clause (ii); and
        (iv) the value of any non-cash benefit or any
        deferred payment or benefit included in the Total
        Payments shall be determined by the Corporation's
        independent auditors in accordance with the
        principles of sections 280G(d)(3) and (4) of the
        Code.
   
4.      Stock Appreciation Rights and Stock Options.

   (a)     If the Executive's employment should terminate
       under such circumstances as entitle the Executive to
       receive payments pursuant to section 3(b) hereof,
       then, in lieu of Stock Appreciation Rights granted to
       the Executive (and whether or not they are in tandem
       with any Options, but provided that this subsection
       shall not apply to any Stock Appreciation Rights in
       tandem with incentive stock options) that were
       outstanding for at least six months prior to the Date
       of Termination and that were neither subsequently
       exercised nor expired by their terms prior to the Date
       of Termination (which rights and any related in tandem
       options shall be cancelled upon the making of the
       payment hereafter described), the Executive shall
       receive an amount in cash on or before the fifth day
       following the Date of Termination equal to the
       difference, if positive, obtained by
   
              (i)  taking the product obtained by
               multiplying
            
               (A)  the number of such stock appreciation
                    rights
               
                times
                
               (B)  the greater of
                     
                    (1)     the mean between the highest and
                       lowest quoted selling prices for the
                       Corporation's common stock on the
                       composite tape for the New York Stock
                       Exchange on the trading day
                       immediately preceding the Date of
                       Termination;
                    
                       or
                    
                    (2)     the highest price paid per share
                       for the Corporation's common stock in
                       the transaction resulting in the
                       actual Change-in-Control.
                    
          and
       
              (ii)      subtracting therefrom the aggregate
               of the products obtained by multiplying the
               mean between the highest and lowest quoted
               selling prices for the Corporation's Common
               Stock on the composite tape for the New York
               Stock Exchange on each date of grant of such
               Stock Appreciation Rights times the number of
               such Stock Appreciation Rights granted on such
               date.
       
   (b)     If the Executive's employment should terminate
       under such circumstances as entitle the Executive to
       payments pursuant to Section 3(b) hereof then the
       Executive may elect, during the 60-day period from and
       after a Change of Control (other than a Change of
       Control initiated by the Executive), to surrender his
       rights in any of the options granted to the Executive
       provided that this subsection shall not apply to any
       Options accompanied by a Stock Appreciation Right that
       were outstanding for at least six months prior to the
       Date of Termination and that were neither subsequently
       exercised nor expired by their terms prior to the Date
       of Termination and, upon such surrender, the
       Corporation shall pay to the Executive an amount of
       cash with respect to each such option equal to the
       difference, if positive, obtained by
       
              (i)  taking the product obtained by
               multiplying
           
               (A)  the number of shares of common stock as
                    to which the option is exercisable
               
                    times
               
                (B)      the greater of
               
                    (1)     the mean between the highest and
                       lowest quoted selling prices for the
                       Corporation's Common Stock on the
                       composite tape for the New York Stock
                       Exchange on the trading day
                       immediately preceding the Date of
                       Termination
                    
                       or
                    
                    (2)     the highest price paid per share
                       for Corporation's Common Stock in the
                       transaction resulting in the actual
                       Change-in-Control
                    
                    and
       
              (ii)      subtracting therefrom the option
               price for such Shares of Common Stock.
   
   (c)     In the event the Executive's employment should
       terminate under such circumstances as entitle the
       Executive to payments pursuant to Section 3(b) hereof,
       the Corporation agrees to accelerate and make
       immediately exercisable in full all unmatured options
       held by the Executive at the Date of Termination,
       whether or not otherwise exercisable, effective as of
       the Date of Termination.  In the event that the
       Executive has been granted Incentive Stock Options
       pursuant to Section 422A(b)(7) of the Internal Revenue
       Code of 1986 (the "Code") which would otherwise become
       immediately exercisable hereunder but for the
       limitation imposed by Code Section 422A(b)(7), such
       options shall only become exercisable as to the
       maximum number of shares permitted by Code Section
       422A(b)(7) and the balance of such options shall
       become exercisable at the earliest date or dates
       thereafter permitted by Code Section 422A(b)(7), with
       those options with the lowest exercise prices becoming
       exercisable at the earliest date or dates.
 5.     Retirement Benefits.

    (a)      If the Executive's employment should terminate
        under such circumstances as entitle the Executive to
        receive payments pursuant to section 3(b) hereof,
        then, notwithstanding such termination, the Executive
        shall be deemed to continue as an active employee
        participant in the Corporation's pension plan for
        salaried employees, and the benefits payable to him,
        his surviving spouse or contingent annuitant shall be
        calculated as if he had been continuously employed by
        the Corporation for those years (including parts
        thereof) subsequent to the Date of Termination and
        prior to the earlier of (i) three years subsequent to
        the Date of Termination, and (ii) the Executive's
        death or attainment of age 65 (or, if earlier, the
        age agreed to by the Executive pursuant to any prior
        arrangement), at the covered remuneration set forth
        in the following sentences of this subsection.  The
        covered remuneration for any part of a year remaining
        after the Date of Termination shall equal the number
        of months remaining in such year times the sum
        determined pursuant to section 3(b)(iv)(B) hereof and
        divided by twelve. The covered remuneration for the
        first full credited year following the Date of
        Termination shall equal the sum determined pursuant
        to section 3(b)(iv)(B) hereof.  The covered
        remuneration for the first full credited year after
        the first full credited year shall equal the sum of
        (i) the covered remuneration for the immediately
        preceding year plus (ii) the product of the Annual
        Salary Adjustment percentage for such credited years
        times the covered remuneration for the immediately
        preceding year.
   
   (b)  If for any reason whether by law or the terms of the
        Corporation's pension plan, such pension plan cannot
        either use the above credited years of service and
        remuneration above described in subsection 5(a) for
        purposes of the Executive's pension benefits
        (including surviving spouse and contingent annuitant
        benefits) or cannot pay the full amount of benefits
        which would result from the foregoing subsections,
        then the Corporation hereby contractually agrees to
        pay the difference between
        
              (i)  the benefits which would be payable if
               the pension plan had been able to pay such
               benefits based upon the credited years of
               service and covered remuneration above
               described in subsection 5(a),
        
         and
        
              (ii)      the benefits, if any, actually paid
               to the Executive, his surviving spouse or
               contingent annuitant by the pension plan.
        
        The Corporation shall not be required to fund its
        obligation to pay the foregoing difference.

 6. Other Benefit Plans.

    (a)      If the Executive's employment should terminate
        under such circumstances as entitle the Executive to
        receive payments pursuant to section 3(b) hereof and
        if the Executive is a participant in the
        Corporation's Executive Benefit Plan (or a plan
        providing comparable benefits) shall be in effect
        prior to the Change-in-Control, then the Executive
        will be deemed for purposes of such Plan (or, if
        applicable, the plan providing comparable benefits)
        to have continuously remained in the employ of the
        Corporation until the earlier of (i) three years
        subsequent to the Date of Termination, and (ii) his
        death or attainment of age 65 (or the age agreed to
        by the Executive pursuant to any prior arrangement),
        at a total compensation equal to his total
        compensation in effect on the Date of Termination
        (provided that in the case of Termination for Good
        Reason by the Executive the date immediately
        preceding the date of the earliest event which gave
        rise to the Termination for Good Reason by the
        Executive shall be used instead of the Date of
        Termination) and to have made any required
        contributions due thereunder.  The Executive will be
        eligible to receive all benefits under such Plan (or,
        if applicable, the plan providing comparable
        benefits) payable as though he had so remained in the
        Corporation's employ and had made any required
        contributions notwithstanding that he neither was so
        employed nor made any such contributions.
   
   (b)  Except with respect to (i) any Stock Appreciation
        Rights and Stock Options, as to which payment is
        provided in Section 4(a) hereof, (ii) the
        Corporation's pension plan, which is governed by
        paragraph 5 hereof, (iii) the Executive Benefit Plan,
        and (iv) the Incentive Compensation Plan, the
        Executive shall be deemed for purposes of all
        employee benefits to have remained in the continuous
        employment of the Corporation for a period of three
        years following the Date of Termination and shall be
        entitled to all of the benefits provided by such
        plans as though he had so remained in the employment
        of the Corporation.
   
   (c)  If for any reason, whether by law or provisions of
        the Corporation's employee benefit plans, any
        benefits which the Executive would be entitled to
        under the foregoing subsections of this section 6
        cannot be paid pursuant to such employee benefit
        plans, then the Corporation hereby contractually
        agrees to pay to the Executive the difference between
        the benefits which the Executive would have received
        in accordance with the foregoing subsections of this
        section if the relevant employee benefit plan could
        have paid such benefit and the amount of benefits, if
        any, actually paid by such employee benefit plan.
        The Corporation shall not be required to fund its
        obligation to pay the foregoing difference.

 7.Other Employment.

    (a) The Executive shall have no duty to seek any other
        employment after termination of his employment with
        the Corporation and the Corporation hereby waives and
        agrees not to raise or use any defense based on the
        position that the Executive had a duty to mitigate or
        reduce the amounts due him hereunder by seeking other
        employment whether suitable or unsuitable.

   (b)  Should the Executive obtain other employment, then
        the only effect of such on the obligations of the
        Corporation hereunder shall be that the Corporation
        shall be entitled to credit against any payments
        which would otherwise be made pursuant to sections 5,
        6(a) or 6(b) hereof, any comparable payments to which
        the Executive is entitled under the pension or other
        employee benefit plans maintained by the Executive's
        other employers after termination of his employment
        with the Corporation.  In no event shall any sums
        received by the Executive from any other employment
        be credited against or otherwise reduce the amounts
        payable by the Corporation pursuant to Sections 3 or
        4 hereof.

 8.Term.

    (a)      This Agreement shall be for a term expiring
        August 31, 1998 and shall automatically be extended
        for successive five year terms at the end of each
        preceding term unless termination occurs pursuant to
        subsection (b) or (c) below, whichever is applicable.

    (b)      If a Change-in-Control has occurred, this
        Agreement shall remain in effect until terminated on
        the date which is three years from the Change-in-
        Control.

    (c)      If a Change-in-Control has not occurred, this
        Agreement shall terminate if the Executive's
        employment with the Corporation terminates for any
        reason whether such termination of employment is by
        the Corporation or by the Executive.  Otherwise,
        prior to a Change-in-Control, this Agreement may only
        be terminated by the Corporation upon the giving by
        the Corporation of notice of termination at least
        thirty days prior to the end of the then term, in
        which event this Agreement shall terminate at the end
        of such term.

 9. Miscellaneous.

    (a)      This Agreement shall be construed under the laws
        of the Commonwealth of Pennsylvania.
   
    (b)      This Agreement constitutes the entire
        understanding of the parties hereto with respect to
        the subject matter hereof and may only be amended or
        modified by written agreement signed by the parties
        hereto.
   
    (c)      The Corporation will require any successor
        (whether direct or indirect, by purchase, merger,
        consolidation or otherwise) to all or substantially
        all of the business and/or assets of the Corporation,
        by agreement in form and substance satisfactory to
        the executive, to  expressly assume and agree to
        perform this Agreement in the same manner required of
        the Corporation and to perform it as if no such
        succession had taken place.  Failure of the
        Corporation to obtain such agreement prior to the
        effectiveness of any such succession shall be a
        breach of this Agreement and shall entitle the
        Executive to terminate employment due to Good Reason
        for Termination. As used in this Agreement,
        "Corporation" shall mean the Corporation as
        hereinbefore defined and any successor to its
        business and/or assets as aforesaid which executes
        and delivers the agreement provided for in this
        subsection (c) or which otherwise becomes bound by
        all the terms and provisions of this Agreement by
        operation of law.
   
   (d)  This Agreement shall inure to the benefit of and be
        enforceable by the Executive or his legal
        representatives, executors, administrators,
        successors, heirs, distributees, devisees and
        legatees.  If the Executive should die while any
        amounts would still be payable to him hereunder if he
        had continued to live, all such amounts, unless
        otherwise provided herein, shall be paid in
        accordance with the terms of this Agreement to his
        devisee, legatee or other designee or if there be no
        such designee, to his estate.
   
   (e)  Any notice or other communication provided for in
        this Agreement shall be in writing and, unless
        otherwise expressly stated herein, shall be deemed to
        have been duly given if mailed by United States
        registered mail, return receipt requested, postage
        prepaid addressed
        in the case of the Executive to his office at the
        Corporation with a copy to his residence and in the
        case of the Corporation to its principal executive
        offices, attention of the Chief Executive Officer.
   
   (f)  No provisions of this Agreement may be modified,
        waived or discharged unless such waiver, modification
        or discharge is agreed to in writing signed by the
        Executive and approved by resolution of the Board of
        Directors of the Corporation.  No waiver by either
        party hereto at any time of any breach by the other
        party hereto of, or compliance with, any condition or
        provision of this Agreement to be performed by such
        other party shall be deemed a waiver of similar or
        dissimilar provisions or conditions at the same or at
        any prior or subsequent time.  Except for any
        employment agreement with the Executive, no
        agreements or representations, oral or otherwise,
        express or implied, with respect to the subject
        matter hereof have been made by either party which
        are not set forth expressly in  this Agreement.  To
        the extent that the provisions of this Agreement are
        in conflict with any such employment agreement,
        following a Change-in-Control the employment
        agreement shall automatically be amended in
        accordance with this Agreement and the provisions of
        this Agreement shall govern.
   
   (g)  The invalidity or unenforceability of any provisions
        of this Agreement shall not affect the validity or
        enforceability of any other provision of this
        Agreement, which shall remain in full force and
        effect.

   (h)  This Agreement may be executed in one or more
        counterparts, each of which shall be deemed to be an
        original but all of which together will constitute
        one and the same instrument.

     IN WITNESS WHEREOF, this Agreement has been executed on
the date first above written.

ATTEST:                        DRAVO CORPORATION


/s/ JAMES J. PUHALA            By  /s/ JOHN R. MAJOR



                               /s/  DONALD H. STOWE, JR.