# Exhibit 10.2IONICS, INCORPORATED
                                              1979 Stock Option Plan
                                         As Amended through March 27, 2003

|1. |  | Purposes
of Plan.
|-- |  | -----------------

This
1979 Stock Option Plan (hereinafter called the "Plan") of Ionics, Incorporated
(hereinafter called the "Company") is intended to advance the interests of the Company
(and its subsidiaries) by providing a means whereby key employees of the Company, that
is, those who are largely responsible for its management and its technical and business
success, and are expected to continue in this role, may be offered incentives in addition
to the other incentives which they may hold, such as pensions, etc.

|2. |  | Definitions.
|-- |  | ------------

2.1
      "Subsidiaries" or "Subsidiary" shall mean a corporation, partnership or other
entity whose controlling stock or other ownership interest is owned directly or
indirectly by the Company.

2.2
      A "key employee" shall mean an employee of the Company or of any of its
Subsidiaries who is engaged in an important executive, administrative or technical
function who is classified by the Administrators of the Plan as such within the purposes
of the Plan.

|3. |  | Effective
Date and Duration.
|-- |  | ----------------------------

The
Plan will become effective immediately upon its adoption by the Board of Directors of the
Company, subject, however, to approval by the holders of a majority of the outstanding
shares of its capital stock having voting rights present at the meeting when the matter
was acted upon.  The Plan shall remain in effect until the close of business on February
15, 1999 (the "Termination Date").

|4. |  | Stock
Subject to the Plan.
|-- |  | --------------------------

Subject
to adjustment as provided hereinbelow, the total aggregate number of shares of Common
Stock, One Dollar ($l) per share par value (hereinafter "Common Stock"), of the Company
which are to be issued and delivered upon exercise of options granted pursuant to this
Plan (hereinafter called the "Options" and each singly an "Option") or pursuant to the
earn out of Performance Units under this Plan, shall not exceed 3,610,000 shares of said
Common Stock.  Such shares may either be authorized and unissued shares of Common Stock
or issued shares of Common Stock which shall have been reacquired by the Company and held
as treasury shares.  In the event that any Options granted under the Plan shall be
surrendered to the Company or shall terminate, lapse or expire for any reason without
having been exercised in full, the shares not purchased under such Options shall be
available again for the purposes of issuance pursuant to the Plan.

In
the event that the outstanding shares of the Common Stock of the Company are hereafter
increased or decreased or changed into or exchanged for a different number or kind of
shares, or other securities of the Company or of another corporation, by reason of
reorganization, merger, consolidation, recapitalization, reclassification, stock
split-up, combination of shares, or dividends payable in stock, corresponding adjustments
as determined by the Board of Directors in their sole discretion to be appropriate shall
forthwith be made in the Option price and in the number and kind of shares for the
purchase of which Options may theretofore or thereafter be granted under the Plan;
provided, however, the aggregate total Option price of Options then outstanding and
unexercised shall not be changed thereby.

|5. |  | Administration
of the Plan.
|-- |  | ---------------------------

The
Plan shall be administered by the Board of Directors of the Company or such committee
composed of its Directors as may be delegated this duty and function by resolution of the
Board of Directors (said Board or said Committee, as the case may be, being hereinafter
referred to as the "Administrators").  The Administrators shall be comprised of, to the
extent required by applicable regulations under Section 162(m) of the Code, two or more
outside Directors as defined in applicable regulations thereunder and, to the extent
required by Rule 16b-3 promulgated under the Securities Exchange Act of 1934 or any
successor provision, disinterested Directors.  A majority of the Administrators acting
upon a particular matter shall have no personal interest in the Option or matter with
which they are concerned.

Subject
to the express provisions of the Plan, the Administrators acting by a majority of their
number at a meeting or by written consent shall have plenary authority in their
discretion to grant Options under the Plan, and in relation thereto to determine from
time to time those officers or employees of the Company or of its Subsidiaries who are to
receive Options, the number of shares to be optioned to each, the Option price (which
shall not be less than the par value of the stock subject to the Option) and the terms
and conditions upon which the Options are to be granted, which need not be identical;
including, without limitation, requirements that an exercise of the Option may be
conditioned in whole or in part upon duration of the optionee's employment, his
attainment of specified performance criteria, his refraining from competitive activities
and other conditions. Options may be granted at any time prior to termination of the Plan
and the Options granted may extend beyond the Termination Date.

Subject
to the express provisions of the Plan, the Administrators may (1) construe the respective
stock option agreements and the Plan, prescribe, amend, and rescind rules and regulations
relating to the Plan and make all other determinations necessary or advisable for
administering the Plan, and (2) correct any defect or supply any omission or reconcile
any inconsistency in the Plan or in any stock Option agreement and in the manner and to
the extent they shall deem expedient to carry it into effect and (3) constitute and
appoint, a person or persons selected by them to execute and deliver in the name and on
behalf of the Administrators all such agreements, instruments and other documents
(including without limitation of the generality of the foregoing documents evidencing
amendments of individual stock Options and other actions delegated to the Administrators
by the votes of the Board of Directors adopted at their meeting on February 18, 1982,
relating to "incentive stock options").

The
Administrators shall have the authority in their discretion to determine from time to
time those officers or employees of the Company or of its Subsidiaries who are eligible
to receive Performance Units, as hereinafter defined.  In connection therewith the
Administrators shall have the authority to prescribe the number of Performance Units to
be granted to any key employee and all terms thereof and to adopt, amend and rescind
rules and regulations for the administration of Performance Units.

|6. |  | Persons
to whom Options and Performance Units may be Granted.
|-- |  | -------------------------------------------------------------

Only
persons who are officers of, or who are "key employees" of the Company or any of its
Subsidiaries, and who accept an Option or Performance Unit granted hereunder, as the case
may be, and subject to all of the terms and conditions of this Plan may be granted any
Options or Performance Units under this Plan.  During any one-year period, no individual
shall be granted Options and/or Performance Units which could result in the issuance to
such individual of more than 100,000 shares of Common Stock.

|7. |  | The
Option Price.
|-- |  | -----------------

The
price payable upon exercise of an Option granted hereunder (the "Option Price") shall be
an amount as specified by the Administrators which shall not be less than the par value
of the stock which is subject to the Option and which shall be paid upon exercise of the
Option (1) in cash, (2) with shares of the Company of the same class as the shares
issuable upon exercise of the Option, previously acquired by the Optionee and having an
aggregate fair market value equal to the aggregate Option Price payable, or (3) in any
combination of cash and of such shares so valued.  In the event such shares are delivered
to pay all or a portion of the Option Price -

|(a) |  | such
shares shall be valued at the closing price for such stock on the American Stock Exchange
or                other exchanges or markets where such shares are primarily traded, as
reported on the date of such                delivery of the shares, and
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) |  | a
number of the shares being issued upon exercise of the Option which is equal to the
number of                shares of such stock delivered in payment of the Option Price
shall be issued free from repurchase                rights of the Company under said Plan
or Stock Option Agreement evidencing the Option.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. |  | The
Duration of the Options.
|-- |  | ----------------------------

The
duration of the Options granted hereunder shall be as determined by the Administrators
but shall not exceed a period of ten years from the date of grant.  Notwithstanding the
preceding sentence, the duration of Options not designated as Incentive Stock Options
pursuant to Section 17 may be a period of ten years and one day from the date of grant.

|9. |  | Nontransferability
of Options.
|-- |  | ------------------------------

No
Option granted under the Plan shall be encumbered, assigned, or otherwise transferred,
and an Option may be exercised during the lifetime of the Optionee only by such person,
and the stock Option agreement covering the Option shares shall so provide.

|10. |  | Exercise
of Options.
|--- |  | --------------------

The exercise, in whole or in part,
of any Option granted under the Plan shall be:

|(a) |  | subject
to compliance of all conditions or restrictions stated in Section 11 of this Plan or
                imposed at the time the Option is granted, and
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) |  | exercisable
only by the employee to whom granted and while he remains in the employment of the
                Company or any of its Subsidiaries, except that -
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

|(1) |  | if
the employee holding the Option ceases to remain in such employment for any reason
                       other than his or her voluntary termination or his or her being
terminated by the Company                        (or its Subsidiary employing said
employee) because of his malfeasance, violation of this                        or any
other agreement with the Company (or its employing Subsidiary), or other like
                       justifiable cause, the employee shall have the right within thirty
(30) days after said                        termination to exercise the Option to the
extent it would have been exercisable by the                        employee immediately
before the employee's termination, and
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | if
the employee holding the Option shall die while in said employment or within said
thirty-day period after                        its termination as described in
sub-paragraph (1) above, the Option, to the extent                        exercisable by
said employee at the time of his death, may be exercised within ninety (90)
                       days after his death by the executor or administrator of the
employee's estate.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Notwithstanding
Sections 10(b)(1) and 10(b)(2) hereof, the Board of Directors may in its discretion amend
any                        outstanding Option granted under the Plan (i) to permit the
continuing exercisability of                        such Option (to the extent then
exercisable) after the employee holding such Option ceases                        to be
employed by the Company for such period of time as may be determined by the Board of
                       Directors, not to exceed the remaining term of such Option, and
(ii) to permit the                        exercise of such Option by the executor or
administrator of such employee's estate in the                        event of such
employee's death at a time when such Option remains exercisable.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Options
shall be exercised in each instance by the person entitled to exercise them by giving
written notice of exercise to the Company (to its Treasurer) substantially in the form of
Exhibit A annexed hereto and tendering payment of the entire Option Price payable.

Unless
the shares deliverable upon exercise of Options are registered or qualified for public
sale by an effective Registration Statement of the Company under the Securities Act of
1933, as amended (or any superseding law) and are registered or qualified for sale under
all applicable state securities laws, the person to whom the stock is issued and
delivered hereunder shall confirm to the Company that the recipient is purchasing the
shares for investment and not with a view to effecting any distribution or resale of the
shares.

In
no instance may an Option be exercised for less than one full share of the stock.

|11. |  | Restrictions
Applicable to Stock Issued and Delivered Under the Plan.
|--- |  | ---------------------------------------------------------------------

| | 11.1 |  | The
Company may elect in granting an Option to include a provision that during the
                  period of five years from the date of grant of the Option, the Company
shall have                   the right to repurchase stock acquired by exercise of the
Option, at a price                   payable in cash equal to the price which the Company
received upon its issuance, to                   the following extent
| | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

`If the Repurchase right                     Portion of the Shares
        arises prior to                      Subject to Repurchase
        ---------------                      ---------------------

 the end of first year                                 All

 the end of the second year                  the excess of 20%  of
                                             the Option shares held

 the end of the third year                   the excess of 40% of
                                             the Option shares held

 the end of the fourth year                  the excess of 60% of
                                             the Option shares held

 the end of the fifth year                   the excess of 80% of
                                             the Option shares held

 After the fifth year of                               None
 holding`

| | (a) |  | if
the employee issued the Option shall cease to be an employee of the Company or of any of
its                Subsidiaries because of the employee's voluntary termination of said
employment or his being                terminated therefrom because of his malfeasance,
violation of this or any other agreement with the                Company or said
Subsidiary for like justifiable cause, and/or
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) |  | before
the participant may sell or transfer the stock in any manner, whether voluntarily, by
               action of law or otherwise.
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------

| | Said right
of the Company to repurchase the stock may be exercised by the Company at any time
               within thirty (30) days after it has notice of any such event.  At the
closing of said purchase                (which shall be held on the fifth business day
following the Company's delivery of written notice                to the holder that the
Company has elected to so purchase the shares) the Company shall pay the
               purchase price to the holder against its receipt of delivery of the stock
certificates                representing the stock being purchased, duly endorsed or with
duly executed stock powers to effect                transfer of the stock to the Company.
 If the Company does not elect to exercise said repurchase                right within
said period, the holder shall be free to sell or transfer the stock free of such
               restriction, but unless said stock has been registered or qualified for
public sale under an                effective Registration Statement or other
authorization under the Securities Act of 1933, as                amended (or under any
superseding law) and qualified for public sale under any applicable state
               securities laws, the holder shall not so sell or transfer without prior
written notice to the                Company and furnishing to the Company an opinion of
legal counsel or of said regulatory authority,                satisfactory to the
Company, that no such registration or qualification of the stock is required
               in the circumstances.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 11.2 |  | Each
stock certificate representing stock issued upon exercise of an Option hereunder shall
                      bear such legend referring to these restrictions as the Company may
require, and it shall                       not transfer ownership of such stock on its
records except upon compliance with these                       restrictions.
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12. |  | Stock
Option Agreement Required.
|--- |  | --------------------------------

Each
stock Option granted under the Plan shall be evidenced by a "Stock Option Agreement"
between the Company and the employee granted the Option, to be in such form as the
Administrators in granting the Option shall determine, provided that said Stock Option
Agreement shall in any event include an undertaking on the part of the Employee to whom
the Option is granted (the "Optionee") that in consideration for the grant of such
Option, the Optionee will not at any time during his employment by the Company or by any
of its Subsidiaries (as defined in the Plan) or within two (2) years following the date
of termination of said employment, without the written consent of the Company, directly
or indirectly, accept employment from, or engage in any work or activities as an
employee, officer, Director, agent, consultant, partner, proprietor or principal
stockholder for any other corporation, person or entity which is substantially
competitive to the business in which the Company or its Subsidiaries are then engaged.

| |  | 13.
 Effect of the Option.
| |  | --------------------------

The
grant of an Option under the Plan shall not entitle the Optionee to have or claim any
rights of a stockholder of the Company (whether as to dividends, voting rights or
otherwise).

Neither-the
grant of an Option nor the making of any Stock Option Agreement under this Plan shall
confirm upon the Optionee any right with respect to continuation of his or her employment
nor shall it affect or restrict the right of the Company, any Subsidiary of it, or any
assuming Company, or any successor of either of them employing the Optionee to terminate
such employment at any time.

|14. |  | Termination,
Suspension, Amendment or Modification of the Plan.
|--- |  | ---------------------------------------------------------------

The
Board of Directors of the Company may at any time amend, alter, suspend or terminate the
Plan provided that:

| | (a) |  | No
change shall be made which, in the judgment of its Board of Directors, will have a
                      material adverse effect upon any Option previously granted under
this Plan unless the                       consent of the Optionee is obtained in writing.
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) |  | Without
the approval by the holders of a majority of the outstanding shares of its capital
                      stock having voting rights,
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------

| |  | (1) |  | the
maximum number of shares reserved for issuance upon the exercise of Options under
                           the Plan may not be changed; and
| |  | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (2) |  | the
classes of employees to whom Options may be granted under the Plan may not be
                          changed.
| |  | --- |  | --------------------------------------------------------------------------------------------------------------------

|15. |  | Merger,
Consolidation or Sale of the Entire Business of the Company.
|--- |  | --------------------------------------------------------------------

If,
prior to the expiration of the Plan, or the period of restriction during which the
Company may have or may obtain rights to repurchase stock issued hereunder pursuant to
Section 11 of the Plan, the Company shall merge with, consolidate in or with, or sell all
or substantially all of its assets and business to another corporation or entity (other
than a company or entity which continues under the control of the same persons who were
the stockholders or owners of the Company immediately prior to the event), all Options
then outstanding shall become subject to exercise in full and all of said repurchase
rights of the Company shall terminate as of the effective date of said transaction.

|16. |  | Optionee
Shall Comply with Applicable Laws and Regulations upon Exercise.
|--- |  | -------------------------------------------------------------------------

Upon
exercise of any Option granted hereunder, the person exercising the Option shall file any
and all reports if any, required of such person under the Securities Exchange Act of
1934, as amended, or otherwise.

|17. |  | Incentive
Stock Options.
|--- |  | ------------------------

The
special terms and conditions of this Section 17 shall apply to Stock Options granted
hereunder which meet any of the following requirements ("Incentive Stock Options"):

| | (a) |  | Options
considered under the Internal Revenue Code to have been granted on or after January 1,
               1981, and before August 14, 1981, as to which the Optionee consents in
writing to the application                of this Section 17; and
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) |  | Options
granted on or after August 14, 1981, and before February 18, 1982, which the
Administrators                designate in the Stock Option Agreement as Incentive Stock
Options, and as to which the Optionee                consents in writing to the
application of this Section 17; and
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) |  | Options
granted on or after February 18, 1982, which the Administrators designate in the Stock
               Option Agreement as Incentive Stock Options.
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------

The
following special terms and conditions (in all of which, any reference to the date of
grant of a Stock Option shall mean the date on which the Stock Option is considered to
have been granted under Sections 421 through 425 of the Internal Revenue Code and the
regulations issued thereunder) shall apply to all Incentive Stock Options:

| | 17.1 |  | Option
Price.  The Option Price shall be not less than the fair market value of the stock
covered                 by the Option, determined as of the date of grant of the Option.
| | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 17.2 |  | Prior
Outstanding Option.  No Incentive Stock Option may be exercised while there remains
                outstanding, within the meaning of Section 422A(c)(7) of the Internal
Revenue Code, any other                 Incentive Stock Option which was granted at an
earlier date to the Optionee to purchase stock in                 this Corporation or in
any other corporation which is on the date of grant of the later Option
                either a parent or subsidiary corporation of this Corporation, or a
predecessor corporation of                 any of such corporations.  The Stock Option
Agreement for every Incentive Stock Option shall                 include a provision to
this effect.  The two preceding sentences shall have no application to any
                Incentive Stock Option granted after December 31, 1986.
| | ---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 17.3 |  | No
Further Grants.  No Option granted after February 15, 1989, shall be designated an
Incentive                 Stock Option.
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------

| | 17.4 |  | Ten
Percent Stockholder.  If any Optionee to whom an Incentive Stock Option is to be granted
                pursuant to the provisions of the Plan is on the date of grant the owner
(as determined under                 Section 424(d) of the Internal Revenue Code) of
stock possessing more than 10% of the total                 combined voting power of all
classes of stock of this Corporation or any of its subsidiaries,                 then the
following special provisions shall be applicable to the Option granted to such
                individual:
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (i) |  | The
Option Price per share of stock subject to such Incentive Stock Option shall not be
                         less than 110% of the fair market value of one share of stock on
the date of grant; and
| |  | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (ii) |  | The
Option shall not have a term in excess of five (5) years from the date of grant.
| |  | ---- |  | ------------------------------------------------------------------------------------

Except
as modified by the preceding provisions of this Section 17, all the provisions of the
Plan shall be applicable to the Incentive Stock Options granted hereunder.

|18. |  | Special
Bonus Grants.
|--- |  | ---------------------

The
Administrators may, but shall not be required to, grant in connection with any Option
which is not designated an Incentive Stock Option a special bonus in cash in an amount
not to exceed the combined federal and state income tax liability incurred by the Option
holder as a consequence of his acquisition of stock pursuant to the exercise of the
Option, and payment of the bonus; payable, at the discretion of the Administrators, in
whole or in part to federal and state taxing authorities for the benefit of the Option
holder at such time or times as withholding payments of such income tax may be required,
and the remainder, if any, to be paid in cash to the Optionee at the time or times at
which he is required to make payment of such tax.  In the event that an Option with
respect to which a special bonus has been granted becomes exercisable by the personal
representative of the estate of the Optionee in accordance with Section 10, the bonus
shall be payable to or for the benefit of the estate in the same manner and to the same
extent as it would have been payable to or for the benefit of the Optionee had he
survived to the date of exercise.  A special bonus may be granted simultaneously with a
related Option, or granted separately with respect to an outstanding Option granted at an
earlier date.  In the case of an Optionee who is an officer or a director of the Company,
an Option with respect to which a special bonus is granted may be exercised:

| | (a) |  | no
earlier than six months after the date on which the bonus is granted; provided, however,
that                this limitation shall not apply in the event that the Optionee dies
or becomes disabled before the                expiration of six months after the date on
which the bonus is granted; and
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) |  | only
within one of the following:
| | --- |  | ---------------------------------

| |  | (i) |  | a
period beginning on the third business day and ending on the twelfth business day
                       following the release for publication by the Company of a
quarterly or annual summary                        statement of its sales and earnings; or
| |  | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (ii) |  | a
period beginning on the first day and ending on the thirtieth day following the date of
                       approval by the stockholders of the Company of (x) any
consolidation or merger of the                        Company in which the Company does
not survive as an independent, publicly owned                        corporation, or
pursuant to which shares of Common Stock would be converted into cash,
                       securities, or other property (other than a merger in which the
holders of Common Stock                        immediately before the merger have the
same proportionate ownership of common stock of the                        surviving
corporation after the merger), or (y) a transfer of all or substantially all of
                       the assets of the Company (other than a transfer to a subsidiary
corporation controlled by                        the Company), or (z) the liquidation or
dissolution of the Company; or
| |  | ---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (iii) |  | a
period beginning on the first day and ending on the thirtieth day following (x) the
                        acquisition of beneficial ownership of thirty percent (30%) or
more of the outstanding                         voting shares of the Company, whether in
one transaction or a series of transactions, by                         another
corporation, entity or person or group of corporations, entities or persons
                        theretofore beneficially owning less than thirty percent (30%) of
such shares, or (y) the                         first purchase of shares pursuant to a
tender or exchange offer (other than one made by                         the Company) for
voting shares of the Company or securities convertible into voting
                        shares, after which offer the offeror, if successful, will become
the beneficial owner of                         at least 30% of the outstanding voting
shares of the Company.
| |  | ----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

For
purposes of this Section 18, the income tax liability incurred by the Option holder shall
be calculated as described in the attached appendix A, as of the date on which an amount
is includible in the Option holder's income pursuant to Section 83 of the Internal
Revenue Code of 1986 as a consequence of his acquisition of stock pursuant to the
exercise of an Option.  The fair market value of the option stock shall be its closing
price on the American Stock Exchange or other exchanges or markets where such shares are
permanently traded, for the date in question, and the tax rate applicable to an Option
holder shall be the single rate or the highest graduated rate (exclusive of surtax)
applied to earned income by a relevant taxing jurisdiction.

|19. |  | Performance
Units.  All Performance Units granted under the Plan shall be on the following terms and
conditions (and such other terms. and conditions that the Administrators-may establish
which are consistent with the Plan):
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (a) |  | A
Performance Unit is defined as the right of a key employee who has been granted the same
to                receive cash and/or Common Stock and/or Options conditioned upon and
measured by the attainment of                financial goals set by the Administrators.
 Performance Units granted under the Plan shall be                evidenced by agreements
in such form and containing such terms and conditions, not inconsistent
               with the Plan, as the Administrators may approve.
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) |  | The
Administrators shall determine the number of Performance Units to be granted to each key
               employee selected for an award and may establish a stated value (the
"Stated Value") of each                Performance Unit.
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) |  | Payment
of Performance Units shall be made by the Company to the extent that such Performance
               Units are earned out by attainment of the performance objectives set for
such Performance Units by                the Administrators pursuant to subsection (d)
below.  Such payment may be in the form of the grant                of Options, or, if
made in cash or shares of Common Stock, shall have a value equal to the dollar
               value of the Performance Units earned out.  Subject to the provisions of
Section 5, payment of the                amounts to which participants are entitled to be
paid in respect of Performance Units as provided                above shall be made in
cash, shares of Common Stock or Options, or in some combination thereof, as
               the Administrators may determine.  The Administrators, in their sole
discretion, may defer                distribution of one-half of the amount of the
payment for a period up to twelve months following                the date in which the
decision as to entitlement to payment is made.
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (d) |  | The
award period ("Award Period") in respect of any Performance Units shall be a period set
by the                Administrators.  At the time each grant of Performance Units is
made, the Administrators shall                establish performance objectives to be
attained within the Award Period as a condition of such                Performance Units
being earned out.  The performance objectives shall be based on a specific
               dollar amount of growth or on a percentage rate of improvement in such
elements as the Company's                (or a subsidiary's) earnings per share, income,
return on equity or such other measures related to                growth or improvement
of the Company (or its Subsidiaries) as the Administrators shall determine.
               The Administrators shall determine whether the performance objectives in
respect of an Award                Period have been attained, as well as the value of the
Performance Units consequently earned out.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) |  | In
the event that recipient of a grant of Performance Units ceases to be a key employee
prior to                the end of the Award Period by reason of disability or death, his
Performance Units if ultimately                earned out shall be payable at the end of
the Award Period in proportion to the active service of                the key employee
during the Award Period, as determined by the Committee.  Upon any other
               termination of employment, Performance Units and all rights associated
therewith shall terminate                unless the Administrators in their discretion
shall determine otherwise.  For purposes of this                subsection, the term
"disability" means disability as defined in any disability program maintained
               by the Company or a subsidiary.
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) |  | Performance
Units may not be transferred otherwise than by will or the laws of descent.
| | --- |  | ---------------------------------------------------------------------------------------

| | (g) |  | If,
as a result of any change in accounting principles or practices or the method of their
               application or in any tax or other laws or regulations, the earnings per
share or other                established criteria of the Company or its Subsidiaries as
reported in the Company's annual report                to stockholders differs materially
from the earnings per share or other such criteria which would                have been
reported absent such change, the Administrators may, in their discretion, equitably
               adjust the reported earnings per share or other such criteria used in
determining the attainment                of any performance objectives previously
established by the Administrators as a condition of                earning out
Performance Units.
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (h) |  | In
the event of a stock dividend or other transaction described in the last paragraph of
Section                4, the Administrators may make appropriate adjustments in
performance objectives, such as earnings                per share, for outstanding
Performance Units.  In the event of a merger, consolidation,                acquisition
or liquidation described in the Section 15, all outstanding Performance Units and all
               rights relating thereto shall terminate, except as otherwise determined by
the Administrators.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (i) |  | No
payments will be made with respect to Performance Units unless arrangements satisfactory
to the                Administrators are made for any federal income tax withholding or
other withholding required.
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (j) |  | Unless
Shares deliverable upon earn out of Performance Units are registered or qualified for
               public sale by an effective Registration Statement of the Company under
the Securities Act of                1933, as amended (or any superseding law) and are
registered or qualified for sale under all                applicable state securities
laws, the person to whom the Common Stock is delivered shall confirm                to
the Company that such recipient is purchasing the Shares for investment and not with a
view to                effecting any distribution or resale of the Shares.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------