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                         FORM OF STOCK OPTION AGREEMENT
                                FOR THE GRANT OF
                      NON-QUALIFIED STOCK OPTIONS UNDER THE
                      INTERNATIONAL SHIPHOLDING CORPORATION
                              STOCK INCENTIVE PLAN

     THIS AGREEMENT is effective as of _____________ by and between
International Shipholding Corporation, a Delaware corporation ("the Company"),
and ____________ ("Optionee").

     WHEREAS Optionee is a key employee of the Company and the Company considers
it desirable and in its best interest that Optionee be given an inducement to
acquire a proprietary interest in the Company and an added incentive to advance
the interests of the Company by possessing an option to purchase shares of the
common stock of the Company, $1.00 par value per share (the "Common Stock") in
accordance with the International Shipholding Corporation Stock Incentive Plan
(the "Plan"), which was adopted by the Board of Directors and approved by the
stockholders.

     NOW, THEREFORE, in consideration of the premises, it is agreed by and
between the parties as follows:

                                       I.

                                 Grant of Option

     The Company hereby grants to Optionee effective ___________ (the "Date of
Grant"), the right, privilege and option to purchase _____________ shares of
Common Stock (the "Option") at an exercise price of ________ per share (the
"Exercise Price"). The Option is a non-qualified stock option and shall not be
treated as an incentive stock option under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code").

                                       II.

                                Time of Exercise

     2.1 Subject to the provisions of the Plan and the other provisions of this
Agreement, the Optionee shall be entitled to exercise his Option at any time
beginning on the date hereof and ending on ________________.

     2.2 If Optionee's employment is terminated, other than as a result of
death, disability or retirement on or after reaching age 65 or early retirement
with the approval of the Board of Directors, the Option must be exercised within
30 days of the date on which Optionee ceases to be an employee.


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     2.3 If an Optionee ceases to be an employee because of disability within
the meaning of Section 22(e)(3) of the Code or retirement, as described in
Section 2.2, the Option must be exercised within one year from the date on which
Optionee ceases to be an employee, but in no event later than ____________.

     2.4 In the event of Optionee's death, the Option must be exercised by his
estate, or by the person to whom such right devolves from him by reason of his
death within one year from the date of death, but in no event later than
___________.

                                      III.

                          Method of Exercise of Option

     Optionee may exercise all or a portion of the Option by delivering to the
Company a signed written notice of his intention to exercise the Option,
specifying therein the number of shares to be purchased, and accompanied by
payment of the exercise price as provided in the Plan. Upon receiving such
notice and payment, the appropriate officer of the Company shall cause the
transfer of title of the shares purchased to Optionee on the Company's stock
records and cause to be issued to Optionee a stock certificate for the number of
shares being acquired. Optionee shall not have any rights as a shareholder until
the stock certificate is issued to him.

                                       IV.

                       No Contract of Employment Intended

     Nothing in this Agreement shall confer upon Optionee any right to continue
in the employ of the Company or any of its subsidiaries, or to interfere in any
way with the right of the Company or any of its subsidiaries to terminate
Optionee's employment relationship with the Company or any of its subsidiaries
at any time.

                                       V.

                                 Binding Effect

     This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators and
successors.


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                                       VI.

                               Non-Transferability

     The Option granted hereby may not be transferred, assigned, pledged or
hypothecated in any manner, by operation of law or otherwise, other than by will
or by the laws of descent and distribution and shall not be subject to
execution, attachment or similar process.

                                      VII.

                             Inconsistent Provisions

     The Option granted hereby is subject to the provisions of the Plan as in
effect on the date hereof and as it may be amended. In the event any provision
of this Agreement conflicts with such a provision of the Plan, the Plan
provision shall control.


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