EDO CORPORATION
                         1996 Long-Term Incentive Plan

1. PURPOSE.

The purpose of the Plan is to foster and promote the long-term financial
success of the Company and materially increase shareholder value by motivating
superior performance by means of performance-related incentives, encouraging
and providing for the acquisition of an ownership interest in the Company by
Eligible Employees, and enabling the Company to attract and retain the services
of an outstanding management team upon whose judgment, interest and special
effort the successful conduct of its operations is largely dependent.

2. DEFINITIONS.

"Award" shall mean any grant or award under the Plan, as evidenced in a written
document delivered to a Participant as provided in Section 11(b).

"Board" shall mean the Board of Directors of the Company.

"Cause" shall mean (i) the willful failure by the Participant to perform
substantially the Participant's duties as an employee of the Company (other
than due to physical or mental illness) (ii) the Participant's engaging in
serious misconduct that is injurious to the Company or any Subsidiary or any
employee of either (iii) the Participant's having been convicted of, or entered
a plea of nolo contendere to, a crime that constitutes a felony, or (iv) the
breach by the Participant of any written covenant or agreement not to compete
with the Company or any Subsidiary.

"Change in Control" shall mean the occurrence of any of the following events:

(i) a majority of the members of the Board at any time cease for any reason
other than due to death or disability to be persons who were members of the
Board twenty-four months prior to such time (the "Incumbent Directors");
provided that any director whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority of the
members of the Board then still in office who are Incumbent Directors shall be
treated as an Incumbent Director; or

(ii) any "person," including a "group" (as such terms are used in Sections
13(d) and 14(d)(2) of the Exchange Act, but excluding the Company, its
Subsidiaries, any employee benefit plan of the Company or any Subsidiary, all
employees of the Company or any Subsidiary or any group of which any of the
foregoing is a member) is or becomes the "beneficial owner" (as defined in Rule
13(d)(3) under the Exchange Act), directly or indirectly, including, without
limitation, by means of a tender or exchange offer, of securities of the
Company representing 30% or more of the combined voting power of the Company's
then outstanding securities; or

(iii) the shareholders of the Company shall approve a definitive agreement (x)
for the merger or other business combination of the Company with or into
another corporation immediately following which merger or combination (A) the
stock of the surviving entity is not readily tradeable on an established
securities market, (B) a majority of the directors of the surviving entity are
persons who (1) were not directors of the Company immediately prior to the
merger and (2) are not nominees or representatives of the Company or (C) any
"person," including a "group" (as such terms are used in Sections 13(d) and
14(d)(2) of the Exchange Act, but excluding the Company, its Subsidiaries, any
employee benefit plan of the Company or any Subsidiary, employees of the
Company or any Subsidiary or any group of which any of the foregoing is a
member) is or becomes the "beneficial owner" (as defined in Rule 13(d)(3) under
the Exchange Act), directly or indirectly, of 30% or more of the securities of
the surviving entity or (y) for the direct or indirect sale or other
disposition of all or substantially all of the assets of the Company, or

(iv) any other event or transaction that is declared by resolution of the Board
to constitute a Change in Control for purposes of the Plan.

Notwithstanding the foregoing, a "Change in Control" shall not be deemed to
occur in the event the Company files for bankruptcy, liquidation or
reorganization under the United States Bankruptcy Code.

"Change in Control Price" shall mean the highest price per share paid or
offered in any bona fide transaction related to a Change in Control, as
determined by the Committee, except that, in the case of Incentive Stock
Options and Stock Appreciation Rights relating to Incentive Stock Options, such
price shall be the Fair Market Value on the date on which the cash out
described in Section 10(a) occurs.

"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
regulations thereunder.

"Committee" shall mean the Compensation Committee of the Board, or such other
Board committee as may be designated by the Board to administer the Plan.

"Common Shares" shall mean the Common Shares, par value $1.00 per share, of the
Company.

"Company" shall mean EDO Corporation and any successor thereto.

"Director Option" shall mean a Nonstatutory Stock Option granted to each
Eligible Director pursuant to Section 5(f) without any action by the Board or
the Committee.

"Disability" shall mean long-term disability as defined under the terms of the
Company's applicable long-term disability plans or policies.

"Early Retirement" shall mean retirement at or after the earliest age at which
the Participant may retire and receive an immediate, but actuarially reduced,
retirement benefit under any defined benefit pension plan maintained by the
Company or any of its Subsidiaries in which such Participant participates.

"Eligible Director" shall mean a person who is serving as a member of the Board
and who is not (and was not at any time during his tenure on the Board) an
Eligible Employee.

"Eligible Employee" shall mean each Executive Officer and each other key
employee of the Company or its Subsidiaries, but shall not include directors
who are not employees of any such entity.

"Employment" shall mean, for purposes of Sections 5(d), 7(b) and 8(b),
continuous and regular salaried employment with the Company or a Subsidiary,
which shall include (unless the Committee shall otherwise determine) any period
of vacation, any approved leave of absence or any salary continuation or
severance pay period and, at the discretion of the Committee, may include
service with any former Subsidiary of the Company.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

"Executive Officer" shall mean those persons who are officers of the Company
within the meaning of Rule 16a-1(f) of the Exchange Act.

"Fair Market Value" shall mean, on any date, the closing price of a Common
Share, as reported for such day on a national exchange, or the mean between the
closing bid and asked prices for a Common Share on such date, as reported on a
nationally recognized system of price quotation. In the event that there are no
Common Share transactions reported on such exchange or system on such date,
Fair Market Value shall mean the closing price on the immediately preceding
date on which Common Share transactions were so reported.

"Incentive Stock Option" shall mean an Option which is intended to meet the
requirements of Section 422 of the Code.

"Nonstatutory Stock Option" shall mean an Option which is not intended to be an
Incentive Stock Option.

"Normal Retirement" shall mean retirement at or after the earliest age at which
the Participant may retire and receive an immediate retirement benefit without
an actuarial reduction for early commencement of benefits under any defined
benefit pension plan maintained by the Company or any of its Subsidiaries in
which such Participant participates.

"Option" shall mean the right to purchase the number of Common Shares specified
by the Committee, at a price and for the term fixed by the Committee in
accordance with the Plan and subject to any other limitations and restrictions
as this Plan and the Committee shall impose; provided that a Director Option
shall mean the right to purchase the number of Common Shares specified in
Section 5(f), on the terms and conditions set forth in such Section 5(f).

"Participant" shall mean an Eligible Employee who is selected by the Committee
to receive an Award under the Plan.

"Performance Period" shall mean the period during which performance measures
are established for Performance Shares or Performance Units as determined by
the Committee.

"Performance Share" shall mean any contingent right granted under Section 8 to
receive a Common Share, which right becomes vested and nonforfeitable upon the
attainment, in whole or in part, of performance objectives determined by the
Committee.

"Performance Unit" shall mean any contingent right granted under Section 8 to
receive cash (or, at the discretion of the Committee, Common Shares), which
right becomes vested and nonforfeitable upon the attainment, in whole or in
part, of performance objectives determined by the Committee.

"Plan" shall mean the EDO Corporation 1996 Long-Term Incentive Plan, described
herein, and as may be amended from time to time.

"Predecessor Plans" means the Company's 1983, 1985 and 1988 Stock Option Plans,
and the Company's 1983 and 1988 Long-Term Incentive Plans.

"Reload Option" shall have the meaning ascribed thereto in Section 5(e).

"Restricted Period" shall mean the period during which a grant of Restricted
Shares is subject to forfeiture.

"Restricted Share" shall mean a Common Share granted under Section 7 which
becomes vested and non-forfeitable, in whole or in part, upon the completion of
such period of service or performance objectives as shall be determined by the
Committee.

"Stock Appreciation Right" shall mean a contractual right granted under Section
6 to receive cash, Common Shares or a combination thereof.

"Subsidiary" shall mean any corporation of which the Company possesses directly
or indirectly fifty percent (50%) or more of the total combined voting power of
all classes of stock of such corporation and any other business organization,
regardless of form, in which the Company possesses directly or indirectly fifty
percent (50%) or more of the total combined equity interests in such
organization.

3. ADMINISTRATION.

The Plan shall be administered by the Committee which shall consist of at least
two directors of the Company chosen by the Board, each of whom is a
"disinterested person" within the meaning of Rule 16b-3 under the Exchange Act.
The Committee shall have the responsibility of construing and interpreting the
Plan and of establishing and amending such rules and regulations as it deems
necessary or desirable for the proper administration of the Plan. Any decision
or action taken or to be taken by the Committee, arising out of or in
connection with the construction, administration, interpretation and effect of
the Plan and of its rules and regulations, shall, to the maximum extent
permitted by applicable law, be within its absolute discretion (except as
otherwise specifically provided herein) and shall be conclusive and binding
upon all Participants and any person claiming under or through any Participant.
Notwithstanding the foregoing, neither the Committee nor the Board shall have
any discretion regarding whether an Eligible Director receives a Director
Option pursuant to Section 5(f), or regarding the terms of any such Director
Option, including, without limitation, the number of shares subject to any such
Director Option.

4. MAXIMUM AMOUNT OF SHARES AVAILABLE FOR AWARDS.

(a) Maximum Number of Shares.

The maximum number of Common Shares in respect of which Awards may be made
under the Plan shall be a total of 600,000 Common Shares. Any shares which, as
of the effective date of the Plan (as determined pursuant to Section 11(h)),
remain available for awards under the Predecessor Plans shall, upon approval of
the Plan by the shareholders of the Company, be cancelled and no longer
available for Awards. The maximum number of Common Shares that may be subject
to any Awards granted to a Participant in any 12 month period shall not exceed
200,000 shares, as each such number may be adjusted pursuant to Section 4(c).
Without limiting the generality of the foregoing, whenever shares are received
by the Company in connection with the exercise of or payment for any Award
granted under the Plan or any award granted under the Predecessor Plans, only
the net number of shares actually issued shall be counted against the foregoing
limit.

(b) Shares Available for Issuance.

Common Shares may be made available from the authorized but unissued shares of
the Company or from shares held in the Company's treasury and not reserved for
some other purpose. In the event that any Award is payable solely in cash, no
shares shall be deducted from the number of shares available for issuance under
Section 4(a) by reason of such Award. In addition, if any Award or award under
the Predecessor Plans in respect of shares is canceled or forfeited for any
reason without delivery of Common Shares, the shares subject to such Award or
award shall thereafter again be available for award pursuant to the Plan.

(c) Adjustment for Corporate Transactions.

In the event that the Committee shall determine that any stock dividend,
extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination, exchange of shares, warrants or
rights offering to purchase Common Shares at a price substantially below fair
market value, or other similar event affects the Common Shares such that an
adjustment is required to preserve, or to prevent enlargement of, the benefits
or potential benefits made available under this Plan, then the Committee may,
in such manner as the Committee may deem equitable, adjust any or all of (i)
the number and kind of shares which thereafter may be awarded or optioned and
sold or made the subject of Stock Appreciation Rights under the Plan, (ii) the
number and kinds of shares subject to outstanding Options (including Director
Options) and other Awards and (iii) the grant, exercise or conversion price
with respect to any of the foregoing. Additionally, the Committee may make
provisions for a cash payment to a Participant or a person who has an
outstanding Option (other than a Director Option) or other Award. However, the
number of shares subject to any Option or other Award shall always be a whole
number.

5. STOCK OPTIONS.

(a) Grant.

Subject to the provisions of the Plan, the Committee shall have the authority
to grant Options to an Eligible Employee and to determine (i) the number of
shares to be covered by each Option, (ii) the exercise price therefor and (iii)
the conditions and limitations applicable to the exercise of the Option. The
Committee shall have the authority to grant Incentive Stock Options or
Nonstatutory Stock Options; provided that Incentive Stock Options may not be
granted to any Participant who is not an employee of the Company or one of its
Subsidiaries at the time of grant. In the case of Incentive Stock Options, the
terms and conditions of such grants shall be subject to and comply with Section
422 of the Code.

(b) Option Price.

The Committee shall establish the exercise price at the time each Option is
granted, which price shall not be less than 100% of the Fair Market Value of
the Common Shares at the date of grant, except that, for purposes of satisfying
the foregoing requirement with respect to a Nonstatutory Stock Option, the
Committee may elect to credit against the exercise price payable by a
Participant the value of any compensation otherwise payable to the Participant
under the terms of the Company's compensation practices and programs which is
surrendered, foregone or exchanged pursuant to such rules or procedures as the
Committee shall establish from time to time.

(c) Exercise.

Each Option shall be exercised at such times and subject to such terms and
conditions as the Committee may specify in the applicable Award or thereafter;
provided, however, that if the Committee does not establish a different
exercise schedule at or after the date of grant of an Option, such Option shall
become exercisable in full on the third anniversary of the date the Option is
granted. The Committee may impose such conditions with respect to the exercise
of Options as it shall deem appropriate, including, without limitation, any
conditions relating to the application of federal or state securities laws. No
shares shall be delivered pursuant to any exercise of an Option unless
arrangements satisfactory to the Committee have been made to assure full
payment of the option price therefor. Without limiting the generality of the
foregoing, payment of the option price may be made in cash or its equivalent
or, if and to the extent permitted by the Committee, by exchanging Common
Shares owned by the optionee (which are not the subject of any pledge or other
security interest), or by a combination of the foregoing, provided that the
combined value of all cash and cash equivalents and the Fair Market Value of
any such Common Shares so tendered to the Company, valued as of the date of
such tender, is at least equal to such option price.

(d) Termination of Employment.

Unless the Committee shall otherwise determine at or after grant, an Option
shall be exercisable following the termination of a Participant's Employment
only to the extent provided in this Section 5(d). If a Participant's Employment
terminates due to the Participant's (i) death, (ii) Disability, (iii) Early
Retirement with the consent of the Committee or (iv) Normal Retirement, the
Participant (or, in the event of the Participant's death or Disability during
Employment or during the period during which an Option is exercisable under
this sentence, the Participant's beneficiary or legal representative) may
exercise any Option held by the Participant at the time of such termination,
regardless of whether then exercisable, for a period of three years (or such
greater or lesser period as the Committee shall determine at or after grant),
but in no event after the date the Option otherwise expires. If a Participant's
Employment is terminated for Cause (or, if after the Participant's termination
of Employment, the Committee determines that the Participant's Employment could
have been terminated for Cause had the Participant still been employed or has
otherwise engaged in conduct that is detrimental to the interests of the
Company, as determined by the Committee in its sole discretion), all Options
held by the Participant shall immediately terminate, regardless of whether then
exercisable. In the event of a Participant's termination of Employment for any
reason not described in the preceding two sentences, the Participant (or, in
the event of the Participant's death or Disability during the period during
which an Option is exercisable under this sentence, the Participant's
beneficiary, estate or legal representative) may exercise any Option which was
exercisable at the time of such termination for 90 days (or such greater or
lesser period as the Committee shall specify at or after the grant of such
Option) following the date of such termination, but in no event after the date
the Option otherwise expires.

(e) Reload Options.

The Committee may provide that a Participant (or, if applicable, the
Participant's permitted transferee) who delivers Common Shares that have been
owned by such Participant (or permitted transferee) for any minimum period of
time specified by the Committee to exercise an Option or an option granted
under the Predecessor Plans, will automatically (to the extent Common Shares
are available for Awards under the Plan) be granted new Options ("Reload
Options") for a number of Common Shares equal to the number of shares so
delivered. Unless the Committee determines otherwise, such Reload Options will
be subject to the same terms and conditions (including the same expiration
date) as the related Option except (i) that the exercise price shall be equal
to the Fair Market Value of a Common Share on the date such Reload Option is
granted and (ii) such Reload Option shall not be exercisable prior to the six
month anniversary of the date of grant and, thereafter, shall be exercisable in
full.

(f) Director Options.

Notwithstanding anything else contained herein to the contrary, on the date an
Eligible Director is first elected to be a member of the Board of Directors,
such Eligible Director shall receive a Director Option to purchase 2,000 Common
Shares at an exercise price per share equal to the Fair Market Value on the
date of grant. Each Director Option shall be exercisable six months after the
date of grant and shall remain exercisable until the earlier to occur of (i)
the tenth anniversary of the date of grant or (ii) the first anniversary of the
date the Eligible Director ceases to be a member of the Board, except that if
the Eligible Director ceases to be a member of the Board after having been
convicted of, or pled guilty or nolo contendere to, a felony, his Director
Options shall be canceled on the date he ceases to be a director. An Eligible
Director may exercise a Director Option in the manner described in Section
5(c).

6. STOCK APPRECIATION RIGHTS.

(a) Grant of SARs.

The Committee shall have the authority to grant Stock Appreciation Rights in
tandem with an Option, in addition to an Option (other than a Director Option),
or freestanding and unrelated to an Option. Stock Appreciation Rights granted
in tandem or in addition to an Option may be granted either at the same time as
the Option or at a later time. Stock Appreciation Rights shall not be
exercisable after the expiration of ten years from the date of grant and shall
have an exercise price determined in the same manner as, and subject to the
same conditions as apply with respect to, a Nonstatutory Stock Option under
Section 5(b).

(b) Exercise of SARs.

A Stock Appreciation Right shall entitle the Participant to receive from the
Company an amount equal to the excess of the Fair Market Value of a Common
Share on the date of exercise of the Stock Appreciation Right over the exercise
price thereof. The Committee shall determine the time or times at which or the
event or events (including, without limitation, a Change of Control) upon which
a Stock Appreciation Right may be exercised in whole or in part, the method of
exercise and whether such Stock Appreciation Right shall be settled in cash,
Common Shares or a combination of cash and Common Shares; provided, however,
that unless otherwise specified by the Committee at or after grant, a Stock
Appreciation Right granted in tandem with an Option shall be exercisable only
at the same time or times as the related Option is exercisable.

7. RESTRICTED SHARES.

(a) Grant of Restricted Shares.

The Committee may grant Awards of Restricted Shares with or without performance
criteria to Eligible Employees at such times and in such amounts, and subject
to such other terms and conditions not inconsistent with the Plan, as it shall
determine. Each grant of Restricted Shares shall be evidenced by an Award
agreement. Unless the Committee provides otherwise at or after the date of
grant, stock certificates evidencing any Restricted Shares so granted shall be
held in the custody of the Secretary of the Company until the Restricted Period
lapses, and, as a condition to the grant of any Award of Restricted Shares, the
Participant shall have delivered to the Secretary of the Company a certificate,
endorsed in blank, relating to the Common Shares covered by such Award.

(b) Termination of Employment.

Unless the Committee otherwise determines at or after grant, the rights of a
Participant with respect to an Award of Restricted Shares outstanding at the
time of the Participant's termination of Employment shall be determined under
this Section 7(b). In the event that a Participant's Employment terminates due
to the Participant's (i) death, (ii) Disability, (iii) Early Retirement with
the consent of the Committee or (iv) Normal Retirement, any Award of Restricted
Shares shall become vested and nonforfeitable as to that number of shares which
is equal to the number of Common Shares subject to such Award times a fraction,
the numerator of which is the number of days actually worked during the
Restricted Period (or, in the case of an Award which has previously vested in
part (an "Installment Award"), the number of days worked since the last vesting
date) and the denominator of which is the total number of days during the
Restricted Period (or, in the case of an Installment Award, the number of days
between the last vesting date and the end of the Restricted Period). Unless the
Committee otherwise determines, any portion of any Restricted Shares Award that
has not become nonforfeitable at the date of a Participant's termination of
Employment shall be forfeited as of such date.

(c) Restricted Period; Restrictions on Transferability during Restricted
Period.

Unless otherwise determined by the Committee at or after the date of grant, the
Restricted Period applicable to any Award of Restricted Shares shall lapse, and
the shares related to such Award of Restricted Shares shall become freely
transferable, at such time as may be determined by the Committee. Restricted
Shares may not be sold, assigned, pledged or otherwise encumbered, except as
herein provided, during the Restricted Period. Any certificates issued in
respect of Restricted Shares shall be registered in the name of the Participant
and deposited by such Participant, together with a stock power endorsed in
blank, with the Company.

(d) Delivery of Shares.

Upon the expiration or termination of the Restricted Period and the
satisfaction (as determined by the Committee) of any other conditions
determined by the Committee, the restrictions applicable to the Restricted
Shares shall lapse and a stock certificate for the number of Common Shares with
respect to which the restrictions have lapsed shall be delivered, free of all
such restrictions, except any that may be imposed by law, to the Participant or
the Participant's beneficiary, estate or legal representative, as the case may
be. No payment will be required to be made by the Participant upon the delivery
of such Common Shares and/or cash, except as otherwise provided in Section
11(a) of the Plan. At or after the date of grant, the Committee may accelerate
the vesting of any Award of Restricted Shares or waive any conditions to the
vesting of any such Award.

(e) Rights as a Shareholder; Dividends.

Unless otherwise determined by the Committee at or after the date of grant,
Participants granted Restricted Shares shall be entitled to receive, either
currently or at a future date, as specified by the Committee, all dividends and
other distributions paid with respect to those shares, provided that if any
such dividends or distributions are paid in Common Shares or other property
(other than cash), such shares and other property shall be subject to the same
forfeiture restrictions and restrictions on transferability as apply to the
Restricted Shares with respect to which they were paid. The Committee will
determine whether and to what extent to credit to the account of, or to pay
currently to, each recipient of Restricted Shares, an amount equal to any
dividends paid by the Company during the Restricted Period with respect to the
corresponding number of Common Shares. To the extent provided by the Committee
at or after the date of grant, any dividends with respect to cash dividends on
the Common Shares credited to a Participant's account shall be deemed to have
been invested in Common Shares on the record date established for the related
dividend and, accordingly, a number of additional Restricted Shares shall be
credited to such Participant's account equal to the greatest whole number which
may be obtained by dividing (x) the value of such dividend on the record date
by (y) the Fair Market Value of a Common Share on such date.

8. PERFORMANCE AWARDS.

(a) Performance Shares and Performance Units.

Subject to the provisions of the Plan, the Committee shall have the authority
to grant Performance Shares and Performance Units to any Eligible Employee and
to determine (i) the number of Performance Shares and the number of Performance
Units to be granted to each Participant and (ii) the other terms and conditions
of such Awards. The Performance Period related to Performance Shares or
Performance Units shall lapse upon the determination by the Committee that the
performance objectives established by the Committee have been attained, in
whole or in part on the date established by the Committee. Such performance
objectives may be related to the performance of (i) the Company, (ii) a
Subsidiary, (iii) a division or unit of the Company or any Subsidiary, (v) the
Participant or (vi) any combination of the foregoing, over a measurement period
or periods established by the Committee. Unless the Committee otherwise
determines at the time of grant of Performance Shares or Performance Units to
an Executive Officer, the performance objectives with respect to such Award
shall include at least one of the following criteria, which may be determined
solely by reference to the performance of the Company or a Subsidiary or based
on comparative performance relative to other companies: (i) total return to
shareholders, (ii) return on equity, (iii) operating income or net income, (iv)
return on capital, (v) economic value added, (vi) earnings per Common Share, or
(vii) market price of the Common Shares. Except to the extent otherwise
expressly provided herein, the Committee may, at any time and from time to
time, change the performance objectives applicable with respect to any
Performance Shares or Performance Units to reflect such factors, including,
without limitation, changes in a Participant's duties or responsibilities or
changes in business objectives (e.g., from corporate to Subsidiary or business
unit performance or vice versa), as the Committee shall deem necessary or
appropriate. Payment for Performance Shares or Performance Units shall be made
by the Company in Common Shares, cash or in any combination thereof, as
determined by the Committee.

(b) Termination of Employment.

Unless the Committee otherwise determines at or after grant, the rights of a
Participant with respect to an Award of Performance Shares or Performance Units
outstanding at the time of the Participant's termination of Employment shall be
determined under this Section 8(b). In the event that a Participant's
Employment terminates due to the Participant's (i) death, (ii) Disability,
(iii) Early Retirement with the consent of the Committee or (iv) Normal
Retirement, any Award of Performance Shares or Performance Units shall become
vested and nonforfeitable at the end of the measurement period as to that
number of shares or units which is equal to that percentage, if any, of such
award that would have been earned based on the attainment or partial attainment
of such performance objectives. In all other cases, any portion of any Award of
Performance Shares or Performance Units that has not become nonforfeitable at
the date of a Participant's termination of Employment shall be forfeited as of
such date.

(c) Awards Nontransferable.

Performance Shares or Performance Units may not be sold, assigned, pledged or
otherwise encumbered, except as herein provided, during the Performance Period.

(d) Award of Dividend Equivalents.

Unless otherwise determined by the Committee at or after the date of grant,
Participants granted Performance Shares or Performance Units shall be entitled
to receive, either currently or at a future date, as specified by the
Committee, all dividends and other distributions paid with respect to those
shares and units, provided that if any such dividends or distributions are paid
in Common Shares or other property (other than cash), such shares and units and
other property shall be subject to the same forfeiture restrictions and
restrictions on transferability as apply to the Performance Shares and
Performance Units with respect to which they were paid. The Committee will
determine whether and to what extent to credit to the account of, or to pay
currently to, each recipient of Performance Shares or Performance Units, an
amount equal to any dividends paid by the Company during the period of deferral
with respect to the corresponding number of Common Shares ("Dividend
Equivalents"). To the extent provided by the Committee at or after the date of
grant, any Dividend Equivalents with respect to cash dividends on the Common
Shares credited to a Participant's account shall be deemed to have been
invested in Common Shares on the record date established for the related
dividend and, accordingly, a number of additional Performance Shares or
Performance Units shall be credited to such Participant's account equal to the
greatest whole number which may be obtained by dividing (x) the value of such
Dividend Equivalent on the record date by (y) the Fair Market Value of a Common
Share on such date.

(e) Interpretation.

Notwithstanding anything else contained in this Section 8 to the contrary, if
any Award of Performance Shares or Performance Units is intended, at the time
of grant, to be other performance based compensation within the meaning of
Section 162(m)(4)(C) of the Code, to the extent required to so qualify any
Award hereunder, the Committee shall not be entitled to exercise any discretion
otherwise authorized under this Section 8 with respect to such Award if the
ability to exercise such discretion (as opposed to the exercise of such
discretion) would cause such Award to fail to qualify as other performance
based compensation.

9. STOCK IN LIEU OF CASH.

The Committee may grant Awards or Common Shares in lieu of all or a portion of
an award otherwise payable in cash to an Executive Officer pursuant to any
bonus or incentive compensation plan of the Company. If shares are issued in
lieu of cash, the number of Common Shares to be issued shall be the greatest
number of whole shares which has an aggregate Fair Market Value on the date the
cash would otherwise have been payable pursuant to the terms of such other plan
equal to or less than the amount of such cash.

10. CHANGE IN CONTROL.

(a) Accelerated Vesting and Payment.

Subject to the provisions of Section 10(b) below, in the event of a Change in
Control, each Option (including a Director Option) and Stock Appreciation Right
shall promptly be canceled in exchange for a payment in cash of an amount equal
to the excess of the Change in Control Price over the exercise price for such
Option or the exercise price for such Stock Appreciation Right, whichever is
applicable, the Restricted Period applicable to all Restricted Shares, and the
Performance Period applicable to Performance Shares and Performance Units shall
expire and all such shares shall become nonforfeitable and immediately
transferable and the Common Shares with respect thereto shall be immediately
payable.

(b) Alternative Awards.

Notwithstanding Section 10(a), no cancellation, acceleration of exercisability,
vesting, cash settlement or other payment shall occur with respect to any Award
or any class of Awards if the Committee reasonably determines in good faith
prior to the occurrence of a Change in Control that such Award or class of
Awards shall be honored or assumed, or new rights substituted therefor (such
honored, assumed or substituted award hereinafter called an "Alternative
Award") by a Participant's new employer (or the parent or a subsidiary of such
employer) immediately following the Change in Control, provided that any such
Alternative Award must:

(i) be based on stock which is traded on an established securities market, or
which will be so traded within 60 days following the Change in Control;

(ii) provide such Participant (or each Participant in a class of Participants)
with rights and entitlements substantially equivalent to or better than the
rights and entitlements applicable under any such Award or class of Awards,
including, but not limited to, an identical or better exercise or vesting
schedule and identical or better timing and methods of payment;

(iii) have substantially equivalent economic value to such Award or class of
Awards (determined by the Committee as constituted immediately prior to the
Change in Control, in its sole discretion, promptly after the Change in
Control); and

(iv) have terms and conditions which provide that in the event that the
Participant's Employment is involuntarily terminated or constructively
terminated (other than for Cause) upon or following such Change in Control, any
conditions on a Participant's rights under, or any restrictions on transfer or
exercisability applicable to, each such Alternative Award shall be waived or
shall lapse, as the case may be.

For this purpose, a constructive termination shall mean a termination by a
Participant following a material reduction in the Participant's compensation, a
material reduction in the Participant's responsibilities or the relocation of
the Participant's principal place of Employment to another location a material
distance farther away from the Participant's home, in each case, without the
Participant's prior written consent.

11. GENERAL PROVISIONS.

(a) Withholding.

The Company shall have the right to deduct from all amounts paid to a
Participant in cash (whether under this Plan or otherwise) any taxes required
by law to be withheld in respect of Awards under this Plan. In the case of any
Award satisfied in the form of Common Shares, no Common Shares shall be issued
unless and until arrangements satisfactory to the Committee shall have been
made to satisfy any withholding tax obligations applicable with respect to such
Award. Without limiting the generality of the foregoing and subject to such
terms and conditions as the Committee may impose, the Company shall have the
right to retain, or the Committee may, subject to such terms and conditions as
it may establish from time to time, permit Participants to elect to tender,
Common Shares (including Common Shares issuable in respect of an Award) to
satisfy, in whole or in part, the amount required to be withheld.

(b) Awards.

Each Award hereunder shall be evidenced in writing. The written agreement shall
be delivered to the Participant and shall incorporate the terms of the Plan by
reference and specify the terms and conditions thereof and any rules applicable
thereto.

(c) Nontransferability.

Unless the Committee shall permit (on such terms and conditions as it shall
establish) an Award to be transferred to a member of the Participant's
immediate family or to a trust or similar vehicle for the benefit of such
immediate family members (collectively, the "Permitted Transferees"), no Award
shall be assignable or transferable except by will or the laws of descent and
distribution, and except to the extent required by law, no right or interest of
any Participant shall be subject to any lien, obligation or liability of the
Participant. Except as otherwise expressly provided in this Plan, all rights
with respect to Awards granted to a Participant under the Plan shall be
exercisable during the Participant's lifetime only by such Participant or, if
applicable, the Permitted Transferees.

(d) No Right to Employment.

No person shall have any claim or right to be granted an Award, and the grant
of an Award shall not be construed as giving a Participant the right to
Employment. Further, the Company and each Subsidiary expressly reserves the
right at any time to terminate the Employment of a Participant free from any
liability or any claim under the Plan, except as provided herein or in any
agreement entered into with respect to an Award.

(e) No Rights to Awards; No Shareholder Rights.

No Participant or Eligible Employee shall have any claim to be granted any
Award under the Plan, and there is no obligation of uniformity of treatment of
Participants and Eligible Employees. Subject to the provisions of the Plan and
the applicable Award, no person shall have any rights as a shareholder with
respect to any Common Shares to be issued under the Plan prior to the issuance
thereof.

(f) Construction of the Plan.

The validity, construction, interpretation, administration and effect of the
Plan and of its rules and regulations, and rights relating to the Plan, shall
be determined solely in accordance with the laws of the State of New York.

(g) Legend.

To the extent any stock certificate is issued to a Participant in respect of an
Award of Restricted Shares under the Plan prior to the expiration of the
applicable Restricted Period, such certificate shall be registered in the name
of the Participant and shall bear an appropriate legend. Upon the lapse of the
Restricted Period with respect to any such Restricted Shares, the Company shall
issue or have issued new share certificates without a legend in exchange for
those previously issued.

(h) Effective Date.

The effective date of this Plan is January 1, 1996. The Plan will become
effective as of that date provided that the Plan receives the approval, within
12 months of its approval by the Board, of the holders of a majority of the
outstanding Common Shares entitled to vote. If such approval is not
forthcoming, the Plan and all Awards shall be null and void. No Awards may be
granted under the Plan after December 31, 2005. Upon shareholder approval of
the Plan, no further awards may be made under the Predecessor Plans. Subject to
shareholder approval of the Plan, if the Committee so determines and the holder
thereof shall consent to any amendment to any outstanding award that has an
adverse affect on such holder's rights thereunder, the provisions of the Plan
shall apply to, and govern, existing awards under the Predecessor Plans and,
such awards shall be amended to provide such holder with any additional
benefits available hereunder.

(i) Amendment of Plan.

The Board or the Committee may amend, suspend or terminate the Plan or any
portion thereof at any time, provided that no amendment shall be made without
shareholder approval if such amendment would: increase the number of Common
Shares subject to the Plan, except pursuant to Section 4(c); change the price
at which Options may be granted; or remove the administration of the Plan from
the Committee.

No amendment may be made to Section 5(f) or any other provision of the Plan
relating to Director Options within six months of the last date on which any
such provision was amended. Without the written consent of an affected
Participant, no termination, suspension or modification of the Plan shall
adversely affect any right of such Participant under the terms of an Award
granted before the date of such termination, suspension or modification.

(j) Application of Proceeds.

The proceeds received by the Company from the sale of its shares under the Plan
will be used for general corporate purposes.

(k) Compliance with Legal and Exchange Requirements.

The Plan, the granting and exercising of Awards thereunder, and the other
obligations of the Company under the Plan, shall be subject to all applicable
federal and state laws, rules, and regulations, and to such approvals by any
regulatory or governmental agency as may be required. The Company, in its
discretion, may postpone the granting and exercising of Awards, the issuance or
delivery of Common Shares under any Award or any other action permitted under
the Plan to permit the Company, with reasonable diligence, to complete such
stock exchange listing or registration or qualification of such Common Shares
or other required action under any federal or state law, rule, or regulation
and may require any Participant to make such representations and furnish such
information as it may consider appropriate in connection with the issuance or
delivery of Common Shares in compliance with applicable laws, rules, and
regulations. The Company shall not be obligated by virtue of any provision of
the Plan to recognize the exercise of any Award or to otherwise sell or issue
Common Shares in violation of any such laws, rules, or regulations; and any
postponement of the exercise or settlement of any Award under this provision
shall not extend the term of such Awards, and neither the Company nor its
directors or officers shall have any obligation or liability to the Participant
with respect to any Award (or Common Shares issuable thereunder) that shall
lapse because of such postponement.

(l) Deferrals.

The Committee may postpone the exercising of Awards, the issuance or delivery
of Common Shares under any Award or any action permitted under the Plan to
prevent the Company or any of its Subsidiaries from being denied a federal
income tax deduction with respect to any Award other than an Incentive Stock
Option.

(m) Number.

Except when otherwise indicated by the context, words in the singular shall
include the plural, and the plural shall include the singular.