RAMSAY HEALTH CARE, INC.
                          1995 LONG TERM INCENTIVE PLAN


     SECTION 1. Purpose. The purposes of this Ramsay Health Care, Inc. 1995 Long
Term Incentive Plan (the "Plan") are to encourage selected employees,  officers,
directors  and  consultants  of, and other  individuals  providing  services to,
Ramsay Health Care, Inc.  (together with any successor  thereto,  the "Company")
and its Affiliates  (as defined below) to acquire a proprietary  interest in the
growth and  performance  of the Company,  to generate an increased  incentive to
contribute to the Company's  future  success and  prosperity  thus enhancing the
value of the  Company for the  benefit of its  stockholders,  and to enhance the
ability of the Company and its  Affiliates  to attract and retain  exceptionally
qualified  individuals  upon whom, in large  measure,  the  sustained  progress,
growth and profitability of the Company depend.

     SECTION 2. Definitions. As used in the Plan, the following terms shall have
the meanings set forth below:

     "Affiliate" shall mean (i) any entity that, directly or through one or more
intermediaries,  is  controlled  by the Company and (ii) any entity in which the
Company has a significant equity interest, as determined by the Committee.

     "Award"  shall  mean  any  Option,  Stock  Appreciation  Right,  Restricted
Security, Performance Award, or Other Stock-Based Award granted under the Plan.

     "Award  Agreement"  shall mean any  written  agreement,  contract  or other
instrument or document evidencing any Award granted under the Plan.

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

     "Cause",  as used in connection  with the  termination  of a  Participant's
employment,  shall mean (i) with  respect to any  Participant  employed  under a
written  employment  agreement  with the Company or an  Affiliate of the Company
which  agreement  includes a definition  of "cause,"  "cause" as defined in such
agreement or, if such agreement  contains no such definition,  a material breach
by the  Participant  of  such  agreement,  or (ii)  with  respect  to any  other
Participant,   the  failure  to  perform   adequately   in  carrying   out  such
Participant's  employment  responsibilities,  including any directives  from the
Board,  or engaging in such behavior in his personal or business life as to lead
the  Committee in its  reasonable  judgment to determine  that it is in the best
interests of the Company to terminate his employment.

     "Common Stock" shall mean the common stock of the Company, $.01 par value.

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

     "Committee" shall mean the Compensation and Conflict of Interest  Committee
or any other  committee of the Board  designated by the Board to administer  the
Plan and composed of not less than three outside directors.

     "Common  Shares" shall mean any or all, as applicable,  of the Common Stock
and such other  securities  or property as may become the subject of Awards,  or
become subject to Awards,  pursuant to an adjustment  made under Section 4(b) of
the Plan  and any  other  securities  of the  Company  or any  Affiliate  or any
successor that may be so designated by the Committee.

     "Employee" shall mean any employee of the Company or of any Affiliate.

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



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     "Fair Market Value" shall mean (A) with respect to any property  other than
the Common  Shares,  the fair market value of such  property  determined by such
methods  or  procedures  as  shall  be  established  from  time  to  time by the
Committee;  and (B) with  respect  to the  Common  Shares,  the last sale  price
regular  way on the date of  reference,  or, in case no sale takes place on such
date,  the average of the high bid and low asked  prices,  in either case on the
principal national  securities exchange on which the Common Shares are listed or
admitted  to  trading,  or if the Common  Shares are not listed or  admitted  to
trading on any national securities exchange, the last sale price reported on the
National  Market  System  of the  National  Association  of  Securities  Dealers
Automated  Quotation  System  ("NASDAQ")  on such  date,  or the  average of the
closing high bid and low asked prices in the over-the-counter market reported on
NASDAQ on such date,  whichever  is  applicable,  or if there are no such prices
reported on NASDAQ on such date,  as furnished to the  Committee by any New York
Stock  Exchange  member  selected  from time to time by the  Committee  for such
purpose.  If there is no bid or asked price  reported on any such date, the Fair
Market  Value  shall be  determined  by the  Committee  in  accordance  with the
regulations  promulgated  under  Section  2031  of the  Code,  or by  any  other
appropriate method selected by the Committee.

     "Good  Reason",   as  used  in  connection   with  the   termination  of  a
Participant's  employment,  shall  mean  (i)  with  respect  to any  Participant
employed under a written  employment  agreement with the Company or an Affiliate
of the Company,  "good reason" as defined in such written  agreement or, if such
agreement contains no such definition,  a material breach by the Company of such
agreement,  or (ii) with  respect  to any other  Participant,  a failure  by the
Company  to pay such  Participant  any  amount  otherwise  vested  and due and a
continuation  of such  failure  for 30  business  days  following  notice to the
Company thereof.

     "Incentive Stock Option" shall mean an option granted under Section 6(a) of
the Plan that is intended to meet the requirements of Section 422 of the Code or
any successor provision thereto.

     "Non-Qualified  Stock  Option"  shall mean an option  granted under Section
6(a) of the Plan that is not intended to be an Incentive Stock Option. Any stock
option  granted by the  Committee  which is not  designated  an Incentive  Stock
Option shall be deemed a Non-Qualified Stock Option.

     "Option"  shall mean an  Incentive  Stock Option or a  Non-Qualified  Stock
Option.

     "Other  Stock-Based  Award" shall mean any right granted under Section 6(e)
of the Plan.

     "Participant" shall mean any individual granted an Award under the Plan.

     "Performance  Award" shall mean any right granted under Section 6(d) of the
Plan.

     "Person" shall mean any individual, corporation,  partnership, association,
joint-stock  company,  trust,  unincorporated  organization,  or  government  or
political subdivision thereof.

     "Released Securities" shall mean securities that were Restricted Securities
but with respect to which all applicable  restrictions  have expired,  lapsed or
been waived in  accordance  with the terms of the Plan or the  applicable  Award
Agreement.

     "Restricted  Securities" shall mean any Common Shares granted under Section
6(c) of the  Plan,  any right  granted  under  Section  6(c) of the Plan that is
denominated  in  Common  Shares  or any  other  Award  under  which  issued  and
outstanding Common Shares are held subject to certain restrictions.

     "Rule  16b-3"  shall  mean Rule 16b-3  promulgated  by the  Securities  and
Exchange  Commission under the Exchange Act, or any successor rule or regulation
thereto as in effect from time to time.

     "Stock  Appreciation Right" shall mean any right granted under Section 6(b)
of the Plan.

     SECTION 3. Administration. The Plan shall be administered by the Committee.
Subject to the terms of the Plan and  applicable  law,  and in addition to other
express  powers and  authorizations  conferred on the Committee by the Plan, the
Committee  shall have full power and authority  to: (i) designate  Participants;
(ii) determine the type or types of Awards to be granted to an eligible Employee
or  other   individual   under  the  Plan;   (iii)   determine  the  number  and
classification  of Common  Shares to be  covered  by (or with  respect  to which
payments,  rights or other  matters are to be  calculated  in  connection  with)
Awards;  (iv)  determine the terms and  conditions  of any Award;  (v) determine
whether,  to what extent, and under what circumstances  Awards may be settled or
exercised  in cash,  Common  Shares,  other  securities,  other  Awards or other
property,  or  canceled,  forfeited or  suspended,  and the method or methods by
which Awards may be settled, exercised,  canceled,  forfeited or suspended; (vi)
determine  requirements for the vesting of Awards or performance  criteria to be
achieved in order for Awards to vest;  (vii) determine  whether,  to what extent
and under what  circumstances  cash,  Common  Shares,  other  securities,  other
Awards,  other property and other amounts payable with respect to an Award under
the Plan shall be deferred either automatically or at the election of the holder
thereof or of the  Committee;  (viii)  interpret and administer the Plan and any
instrument  or  agreement  relating  to, or Award  made  under,  the Plan;  (ix)
establish,  amend,  suspend or waive such rules and regulations and appoint such
agents as it shall deem appropriate for the proper  administration  of the Plan;
and (x)  make  any  other  determination  and take  any  other  action  that the
Committee  deems  necessary or  desirable  for the  administration  of the Plan.
Unless   otherwise   expressly   provided   in  the  Plan,   all   designations,
determinations, interpretations and other decisions under or with respect to the
Plan or any Award shall be within the sole  discretion of the Committee,  may be
made at any time and shall be final,  conclusive  and binding  upon all Persons,
including the Company, any Affiliate, any Participant, any holder or beneficiary
of any Award, any shareholder and any Employee.  Notwithstanding  the foregoing,
the maximum number of Awards which may be granted to any one  Participant  under
this Plan shall not exceed  150,000 Common  Shares,  subject to the  adjustments
provided in Section  4(b) hereof and no Awards  under this Plan shall be granted
after June 30, 2005.

     SECTION 4. Common Shares Available for Awards.

     (a)  Common  Shares  Available.   Subject  to  adjustment  as  provided  in
          Section 4(b):

     (i)  Calculation of Number of Common Shares Available. The number of Common
          Shares  available for granting Awards under the Plan shall be 500,000,
          any or all of which may be or may be based on Common Stock,  any other
          security  which  becomes  the  subject of Awards,  or any  combination
          thereof.  Initially  500,000  shares of Common Stock shall be reserved
          for Awards  hereunder.  Further,  if, after the effective  date of the
          Plan,  any Common Shares covered by an Award granted under the Plan or
          to  which  such  an  Award  relates,  are  forfeited,  or if an  Award
          otherwise  terminates or is canceled without the delivery of Shares or
          of other  consideration,  then the Common Shares covered by such Award
          or to which  such  Award  relates,  or the  number  of  Common  Shares
          otherwise  counted  against  the  aggregate  number of  Common  Shares
          available  under the Plan with respect to such Award, to the extent of
          any such forfeiture,  termination or cancellation,  shall again be, or
          shall become, available for granting Awards under the Plan.

     (ii) Accounting for Awards. For purposes of this Section 4,

          (A)  if an Award is denominated  in or based upon Common  Shares,  the
               number of Common  Shares  covered  by such Award or to which such
               Award relates shall be counted on the date of grant of such Award
               against  the  aggregate  number of Common  Shares  available  for
               granting  Awards under the Plan and against the maximum number of
               Awards available to any Participant; and

          (B)  Awards not  denominated  in Common Shares may be counted  against
               the  aggregate  number of Common  Shares  available  for granting
               Awards  under the Plan and against  the maximum  number of Awards
               available to any  participant  in such amount and at such time as
               the Committee  shall determine  under  procedures  adopted by the
               Committee consistent with the purposes of the Plan;

         provided,  however,  that Awards that  operate in tandem with  (whether
         granted  simultaneously  with or at a different time from), or that are
         substituted  for,  other  Awards may be counted  or not  counted  under
         procedures  adopted by the Committee in order to avoid double counting.
         Any Common  Shares that are  delivered by the  Company,  and any Awards
         that are granted by, or become obligations of, the Company, through the
         assumption by the Company or an Affiliate of, or in  substitution  for,
         outstanding  awards previously granted by an acquired company shall, in
         the  case  of  Awards  granted  to  Participants  who are  officers  or
         directors  of the  Company for  purposes of Section 16 of the  Exchange
         Act, be counted against the Common Shares available for granting Awards
         under the Plan.

        (iii)  Sources of Common Shares  Deliverable  Under  Awards.  Any Common
               Shares delivered pursuant to an Award may consist, in whole or in
               part,  of  authorized  and unissued  Common Shares or of treasury
               Common Shares.

          (b)  Adjustments. In the event that the Committee shall determine that
               any dividend or other distribution  (whether in the form of cash,
               Common   Shares,    other    securities   or   other   property),
               recapitalization,    stock    split,    reverse    stock   split,
               reorganization,   merger,   consolidation,   split-up,  spin-off,
               combination,  repurchase  or exchange  of Common  Shares or other
               securities  of the Company,  issuance of warrants or other rights
               to purchase Common Shares or other securities of the Company,  or
               other similar  corporate  transaction or event affects the Common
               Shares such that an  adjustment is determined by the Committee to
               be appropriate in order to prevent dilution or enlargement of the
               benefits or  potential  benefits  intended  to be made  available
               under the Plan,  then the Committee  shall,  in such manner as it
               may deem equitable,  adjust any or all of (i) the number and kind
               of  Common  Shares  (or  other   securities  or  property)  which
               thereafter may be made the subject of Awards, (ii) the number and
               kind of Common Shares (or other  securities or property)  subject
               to outstanding Awards, and (iii) the grant or exercise price with
               respect to any Award or, if deemed  appropriate,  make  provision
               for a  cash  payment  to  the  holder  of an  outstanding  Award;
               provided,  however,  that the number of Common Shares  subject to
               any Award  denominated  in Common  Shares shall always be a whole
               number.

     In connection with any merger or  consolidation in which the Company is not
the surviving  corporation  and which results in the holders of the  outstanding
voting securities of the Company (determined immediately prior to such merger or
consolidation)  owning less than a majority of the outstanding voting securities
of the surviving  corporation  (determined  immediately following such merger or
consolidation),  or any sale or transfer by the Company of all or  substantially
all its assets or any tender  offer or  exchange  offer for or the  acquisition,
directly or indirectly,  by any person or group of all or a majority of the then
outstanding voting securities of the Company,  all outstanding Options under the
Plan shall become  exercisable in full,  notwithstanding  any other provision of
the Plan or of any outstanding options granted thereunder,  on and after (i) the
fifteenth day prior to the effective date of such merger,  consolidation,  sale,
transfer or acquisition or (ii) the date of commencement of such tender offer or
exchange  offer,  as the case may be. The  provisions of the foregoing  sentence
shall apply to any outstanding  Options which are Incentive Stock Options to the
extent permitted by Section 422(d) of the Code and such  outstanding  Options in
excess thereof shall,  immediately upon the occurrence of the event described in
clause (i) or (ii) of the foregoing sentence, be treated for all purposes of the
Plan as Non-Qualified Stock Options and shall be immediately exercisable as such
as provided in the foregoing sentence.

     SECTION  5.   Eligibility.   Any   Employee,   including   any  officer  or
employee-director of the Company or of any Affiliate,  and any consultant of, or
other  individual  providing  services to, the Company or any Affiliate shall be
eligible to be  designated  a  Participant.  A  non-employee  director  shall be
eligible to receive Non-Qualified Stock Options under the Plan.

     SECTION 6. Awards.

     (a)  Options.  The  Committee  is hereby  authorized  to grant to  eligible
individuals  options to purchase  Common Shares (each,  an "Option") which shall
contain the following  terms and conditions and with such  additional  terms and
conditions,  in either case not inconsistent with the provisions of the Plan, as
the Committee shall determine:

          (i)  Exercise Price.  The purchase price per Common Share  purchasable
               under an Option shall be determined by the  Committee;  provided,
               however, that such purchase price shall not be less than the Fair
               Market  Value  of a  Common  Share  on the  date of grant of such
               Option, or such other price as required under Subsection 6(a)(iv)
               hereof.

          (ii) Time and  Method of  Exercise.  Subject  to the terms of  Section
               6(a)(iii),  the  Committee  shall  determine the time or times at
               which an Option  may be  exercised  in whole or in part,  and the
               method or  methods  by which,  and the form or forms  (including,
               without limitation,  cash, Common Shares,  outstanding Awards, or
               other property, or any combination thereof,  having a Fair Market
               Value on the exercise date equal to the relevant  exercise price)
               in which,  payment of the exercise price with respect thereto may
               be made or deemed to have been made.

          (iii)Exercisability   Upon  Death,   Retirement  and   Termination  of
               Employment.  Subject  to the  condition  that  no  Option  may be
               exercised in whole or in part after the  expiration of the Option
               period specified in the applicable Award Agreement:

               (A)  Subject to the terms of paragraph (D) below,  upon the death
                    of a  Participant  while  employed  or  within 3  months  of
                    retirement  or disability as defined in paragraph (B) below,
                    the person or persons to whom such Participant's rights with
                    respect  to  any  Option  held  by  such   Participant   are
                    transferred by will or the laws of descent and  distribution
                    may,  prior to the  expiration  of the  earlier  of: (1) the
                    outside  exercise  date  determined  by the Committee at the
                    time of granting  the Option,  or (2) nine months after such
                    Participant's  death,  purchase  any or  all  of the  Common
                    Shares with respect to which such  Participant  was entitled
                    to   exercise   such  Option   immediately   prior  to  such
                    Participant's death, and any Options not so exercisable will
                    lapse on the date of such Participant's death;

               (B)  Subject  to  the  terms  of   paragraph   (D)  below,   upon
                    termination of a  Participant's  employment with the Company
                    (x) as a result of retirement  pursuant to a retirement plan
                    of the Company or an Affiliate or disability  (as determined
                    by the  Committee) of such  Participant,  (y) by the Company
                    other than for Cause,  or (z) by the  Participant  with Good
                    Reason, such Participant may, prior to the expiration of the
                    earlier of: (1) the outside  exercise date determined by the
                    Committee at the time of granting  the Option,  or (2) three
                    months after the date of such  termination,  purchase any or
                    all  of  the  Common  Shares  with  respect  to  which  such
                    Participant was entitled to exercise any Options immediately
                    prior  to  such   termination,   and  any   Options  not  so
                    exercisable will lapse on such date of termination;

               (C)  Subject  to  the  terms  of   paragraph   (D)  below,   upon
                    termination of a  Participant's  employment with the Company
                    under any  circumstances  not described in paragraphs (A) or
                    (B) above, such  Participant's  Options shall be canceled to
                    the extent not theretofore exercised;

               (D)  Upon (i) the death of the  Participant,  or (ii) termination
                    of the Participant's  employment with the Company (x) by the
                    Company  other  than for Cause (y) by the  Participant  with
                    Good Reason or (z) as a result of  retirement  or disability
                    as defined in paragraph  (B) above,  the Company  shall have
                    the right to cancel all of the Options such  Participant was
                    entitled   to   exercise  at  the  time  of  such  death  or
                    termination  (subject to the terms of paragraphs  (A) or (B)
                    above) for a payment in cash equal to the excess, if any, of
                    the Fair  Market  Value of one  Common  Share on the date of
                    death or termination  over the exercise price of such Option
                    for one  Common  Share  times the  number  of Common  Shares
                    subject to the Option  and  exercisable  at the time of such
                    death or termination; and

               (E)  Upon expiration of the respective  periods set forth in each
                    of  paragraphs  (A)  through  (C)  above,  the  Options of a
                    Participant  who  has  died or  whose  employment  has  been
                    terminated  shall be canceled to the extent not  theretofore
                    canceled or exercised.

               (F)  For purposes of paragraphs (A) through (D) above, the period
                    of service of an  individual  as a director or consultant of
                    the  Company or an  Affiliate  shall be deemed the period of
                    employment.

          (iv) Incentive  Stock Options.  The following  provisions  shall apply
               only to Incentive Stock Options granted under the Plan:

                    (A)  No  Incentive  Stock  Option  shall be  granted  to any
                         eligible  Employee  who,  at the time  such  Option  is
                         granted,  owns  securities  possessing  more  than  ten
                         percent (10%) of the total combined voting power of all
                         classes  of   securities  of  the  Company  or  of  any
                         Affiliate, except that such an Option may be granted to
                         such an  Employee  if at the time the Option is granted
                         the option  price is at least one  hundred  ten percent
                         (110%) of the Fair  Market  Value of the Common  Shares
                         (determined  in  accordance  with Section 2) subject to
                         the  Option,  and  the  Option  by  its  terms  is  not
                         exercisable after the expiration of five (5) years from
                         the date the Option is granted; and

                    (B)  To the extent that the  aggregate  Fair Market Value of
                         the Common Shares with respect to which Incentive Stock
                         Options   (without  regard  to  this   subsection)  are
                         exercisable for the first time by any individual during
                         any  calendar  year (under all plans of the Company and
                         its Affiliates) exceeds $100,000, such Options shall be
                         treated as Non-Qualified Stock Options. This subsection
                         shall be applied by taking  Options into account in the
                         order in which they were  granted.  If some but not all
                         Options  granted  on any one day  are  subject  to this
                         subsection,  then  such  Options  shall be  apportioned
                         between Incentive Stock Option and Non-Qualified  Stock
                         Option  treatment in such manner as the Committee shall
                         determine.  For purposes of this  subsection,  the Fair
                         Market Value of any Common Shares shall be  determined,
                         in accordance with Section 2, as of the date the Option
                         with respect to such Common Shares is granted.

          (v)  Terms  and   Conditions   of  Options   Granted   to   Directors.
               Notwithstanding  any  provision  contained  in  the  Plan  to the
               contrary,  during  any period  when any  member of the  Committee
               shall not be a  "disinterested  person" as defined in Rule 16b-3,
               as such Rule was in effect at April 30, 1991, then, the terms and
               conditions  of Options  granted under the Plan to any director of
               the Company during such period shall be as follows:

               (A)  The price at which each  Common  Share  subject to an option
                    may be purchased shall, subject to any adjustments which may
                    be made  pursuant to Section 4, in no event be less than the
                    Fair  Market  Value of a Common  Share on the date of grant,
                    and  provided  further  that  in the  event  the  option  is
                    intended to be an  Incentive  Stock  Option and the optionee
                    owns on the date of grant  securities  possessing  more than
                    ten percent (10%) of the total combined  voting power of all
                    classes of  securities  of the Company or of any  Affiliate,
                    the price per share  shall not be less than one  hundred ten
                    percent  (110%) of the Fair Market Value per Common Share on
                    the date of grant.

               (B)  The  Option  may be  exercised  to  purchase  Common  Shares
                    covered  by the  Option  not  sooner  than  six  (6)  months
                    following the date of grant.  The Option shall terminate and
                    no Common Shares may be purchased  thereunder  more than ten
                    (10)  years  after the date of grant,  provided  that if the
                    Option is intended to be an  Incentive  Stock Option and the
                    Optionee  owns on the  date of grant  securities  possessing
                    more than ten  percent  (10%) of the total  combined  voting
                    power of all classes of  securities of the Company or of any
                    Affiliate,  the Option shall  terminate and no Common Shares
                    may be purchased  thereunder  more than five (5) years after
                    the date of grant.

               (C)  The maximum  number of Common Shares which may be subject to
                    options  granted to all  directors  pursuant to this Section
                    5(j) shall be 500,000 shares in the  aggregate.  The maximum
                    number of Common  Shares  which may be  subject  to  options
                    granted  to any  director  of the  Company  shall be 150,000
                    shares.

     (b) Stock Appreciation  Rights. The Committee is hereby authorized to grant
to eligible Employees "Stock Appreciation Rights." Each Stock Appreciation Right
shall  consist of a right to receive the excess of (i) the Fair Market  Value of
one Common Share on the date of exercise or, if the Committee shall so determine
in the case of any such right  other than one  related  to any  Incentive  Stock
Option,  at any time  during a  specified  period  before  or after  the date of
exercise  over (ii) the grant price of the right as specified by the  Committee,
which shall not be less than one hundred percent (100%) of the Fair Market Value
of one Common Share on the date of grant of the Stock Appreciation Right (or, if
the  Committee  so  determines,  in the  case of any  Stock  Appreciation  Right
retroactively  granted in tandem with or in  substitution  for another Award, on
the date of grant of such other Award). Subject to the terms of the Plan and any
applicable Award Agreement, the grant price, term, methods of exercise,  methods
of  settlement,  and any other terms and  conditions  of any Stock  Appreciation
Right  granted  under the Plan  shall be as  determined  by the  Committee.  The
Committee  may impose such  conditions  or  restrictions  on the exercise of any
Stock Appreciation Right as it may deem appropriate.

     (c) Restricted Securities.

          (i)  Issuance. The Committee is hereby authorized to grant to eligible
               Employees  "Restricted  Securities"  which  shall  consist of the
               right to receive,  by purchase or otherwise,  Common Shares which
               are  subject to such  restrictions  as the  Committee  may impose
               (including,  without  limitation,  any limitation on the right to
               vote such Common  Shares or the right to receive any  dividend or
               other right or property), which restrictions may lapse separately
               or in combination at such time or times, in such  installments or
               otherwise, as the Committee may deem appropriate.

          (ii) Registration. Restricted Securities granted under the Plan may be
               evidenced in such manner as the Committee  may deem  appropriate,
               including,   without  limitation,   book-entry   registration  or
               issuance of a stock certificate or certificates. In the event any
               stock  certificate is issued in respect of Restricted  Securities
               granted under the Plan, such  certificate  shall be registered in
               the name of the Participant and shall bear an appropriate  legend
               referring to the terms, conditions and restrictions applicable to
               such Restricted Securities.

          (iii)Forfeiture. Except as otherwise determined by the Committee, upon
               termination of a  Participant's  employment for any reason during
               the  applicable  restriction  period,  all of such  Participant's
               Restricted Securities which had not become Released Securities by
               the date of  termination  of  employment  shall be forfeited  and
               reacquired by the Company; provided,  however, that the Committee
               may,  when it finds that a waiver would be in the best  interests
               of the  Company,  waive in whole or in part any or all  remaining
               restrictions  with  respect  to  such  Participant's   Restricted
               Securities.  Unrestricted Common Shares, evidenced in such manner
               as the Committee shall deem  appropriate,  shall be issued to the
               holder of Restricted  Securities  promptly after such  Restricted
               Securities become Released Securities.

     (d)  Performance  Awards.  The  Committee is hereby  authorized to grant to
eligible Employees "Performance Awards." Each Performance Award shall consist of
a right, (i) denominated or payable in cash, Common Shares,  other securities or
other property (including, without limitation,  Restricted Securities), and (ii)
which shall confer on the holder  thereof  rights  valued as  determined  by the
Committee  and  payable  to, or  exercisable  by, the holder of the  Performance
Award,  in whole or in part,  upon the  achievement  of such  performance  goals
during such performance periods as the Committee shall establish. Subject to the
terms of the Plan and any applicable Award Agreement,  the performance  goals to
be achieved during any performance period, the length of any performance period,
the amount of any Performance Award granted,  the termination of a Participant's
employment  and the amount of any payment or transfer to be made pursuant to any
Performance  Award shall be  determined  by the Committee and by the other terms
and conditions of any Performance  Award. The Committee shall issue  performance
goals  prior  to the  commencement  of the  performance  period  to  which  such
performance goals pertain.

     (e) Other Stock-Based  Awards.  The Committee is hereby authorized to grant
to eligible  Employees "Other Stock Based Awards." Each Other  Stock-Based Award
shall consist of a right (i) which is other than an Award or right  described in
Section 6(a), (b), (c) or (d) above and (ii) which is denominated or payable in,
valued in whole or in part by reference to, or otherwise based on or related to,
Common Shares (including, without limitation, securities convertible into Common
Shares) as are deemed by the Committee to be consistent with the purposes of the
Plan;  provided,  however,  that such right shall  comply,  to the extent deemed
desirable by the Committee,  with Rule 16b-3 and applicable law.  Subject to the
terms  of the Plan and any  applicable  Award  Agreement,  the  Committee  shall
determine the terms and conditions of Other Stock-Based Awards. Common Shares or
other  securities  delivered  pursuant to a purchase  right  granted  under this
Section 6(e) shall be  purchased  for such  consideration,  which may be paid by
such method or methods and in such form or forms, including, without limitation,
cash, Common Shares,  other  securities,  other Awards,  other property,  or any
combination thereof, as the Committee shall determine.

     (f) General.

          (i)  No Cash  Consideration  for Awards.  Awards may be granted for no
               cash  consideration or for such minimal cash consideration as may
               be required by applicable law.

          (ii) Awards May Be Granted Separately or Together.  Awards may, in the
               discretion  of the  Committee,  be  granted  either  alone  or in
               addition to, in tandem  with,  or in  substitution  for any other
               Award, except that in no event shall an Incentive Stock Option be
               granted  together  with a  Non-Qualified  Stock  Option in such a
               manner  that the  exercise  of one  Option  affects  the right to
               exercise  the other.  Awards  granted in addition to or in tandem
               with other Awards may be granted either at the same time as or at
               a different time from the grant of such other awards.

          (iii)Forms of Payment Under  Awards.  Subject to the terms of the Plan
               and of any applicable Award  Agreement,  payments or transfers to
               be made by the Company or an Affiliate  upon the grant,  exercise
               or  payment  of an Award may be made in such form or forms as the
               Committee shall determine,  including,  without limitation, cash,
               Common Shares, other securities, other Awards, or other property,
               or any combination  thereof,  and may be made in a single payment
               or transfer,  in  installments,  or on a deferred  basis, in each
               case in accordance  with rules and procedures  established by the
               Committee.   Such  rules  and  procedures  may  include,  without
               limitation, provisions for the payment or crediting of reasonable
               interest on installment or deferred payments.  In accordance with
               the above,  the Committee may elect (i) to pay a Participant  (or
               such Participant's  permitted transferee) upon the exercise of an
               Option in whole or in part,  in lieu of the exercise  thereof and
               the delivery of Common Shares thereunder, an amount of cash equal
               to the excess,  if any,  of the Fair  Market  Value of one Common
               Share on the date of such  exercise  over the  exercise  price of
               such  Option  for one  Common  Share  times the  number of Common
               Shares  subject to the Option or portion  thereof so exercised or
               (ii) to settle other stock denominated Awards in cash.

          (iv) Limits on Transfer of Awards.

               (A)  No award  (other  than  Released  Securities),  and no right
                    under any such Award, may be assigned,  alienated,  pledged,
                    attached,  sold or otherwise  transferred or encumbered by a
                    Participant otherwise than by will or by the laws of descent
                    and distribution (or, in the case of Restricted  Securities,
                    to  the   Company)  and  any  such   purported   assignment,
                    alienation,  pledge,  attachment,  sale or other transfer or
                    encumbrance  shall be void  and  unenforceable  against  the
                    Company or any Affiliate.

               (B)  Each  award,  and  each  right  under  any  Award,  shall be
                    exercisable  during the  Participant's  lifetime only by the
                    Participant or, if permissible  under applicable law, by the
                    Participant's guardian or legal representative.

          (v)  Terms of Awards.  The term of each Award shall be for such period
               as may be determined by the Committee; provided, however, that in
               no event  shall  the term of any  Option  exceed a period  of ten
               years  from the date of its  grant.  (vi)  Rule  16b-3  Six-Month
               Limitations.  To the extent  required  in order to  maintain  the
               exemption  provided  under Rule 16b-3 only,  any equity  security
               offered pursuant to the Plan must be held for at least six months
               after  the date of  grant,  and with  respect  to any  derivative
               security  issued  pursuant to the Plan,  at least six months must
               elapse from the date of acquisition of such  derivative  security
               to the date of disposition of the derivative security (other than
               upon exercise or conversion) or its underlying  equity  security.
               Terms used in the preceding  sentence shall,  for the purposes of
               such  sentence  only,  have the  meanings,  if any,  assigned  or
               attributed to them under Rule 16b-3.

          (vii)Common Share  Certificates.  All  certificates  for Common Shares
               delivered  under the Plan  pursuant to any Award of the  exercise
               thereof shall be subject to such stop  transfer  orders and other
               restrictions  as the Committee may deem advisable  under the Plan
               or  the  rules,  regulations,   and  other  requirements  of  the
               Securities and Exchange Commission, any stock exchange upon which
               such Common Shares are then listed, and any applicable Federal or
               state  securities  laws,  and the Committee may cause a legend or
               legends to be put on any such  certificates  to make  appropriate
               reference to such restrictions.

          (viii) Delivery of Common  Shares or Other  Securities  and Payment by
               Participant   of   Consideration.   No  Common  Shares  or  other
               securities shall be delivered pursuant to any Award until payment
               in full of any amount required to be paid pursuant to the Plan or
               the applicable  Award Agreement is received by the Company.  Such
               payment may be made by such method or methods and in such form or
               forms  as  the  Committee  shall  determine,  including,  without
               limitation,  cash, Common Shares, other securities,  other Awards
               or other property, or any combination thereof;  provided that the
               combined value,  as determined by the Committee,  of all cash and
               cash  equivalents  and the Fair  Market  Value of any such Common
               Shares or other  property so tendered to the  Company,  as of the
               date of  such  tender,  is at  least  equal  to the  full  amount
               required to be paid pursuant to the Plan or the applicable  Award
               Agreement to the Company.

     SECTION 7. Amendments;  Adjustments and  Termination.  Except to the extent
prohibited by applicable law and unless otherwise expressly provided in an Award
Agreement or in the Plan:

     (a)  Amendments  to  the  Plan.  The  Board  may  amend,  alter,   suspend,
discontinue,  or  terminate  the Plan  without the  consent of any  stockholder,
Participant, other holder or beneficiary of an Award, or other Person; provided,
however,  that,  subject to the Company's rights to adjust Awards under Sections
7(c)  and  (d),  any  amendment,  alteration,  suspension,  discontinuation,  or
termination that would impair the rights of any Participant, or any other holder
or beneficiary  of any Award  theretofore  granted,  shall not to that extent be
effective without the consent of such  Participant,  other holder or beneficiary
of  an  Award,  as  the  case  may  be;  and  provided  further,  however,  that
notwithstanding any other provision of the Plan or any Award Agreement,  without
the approval of the  stockholders of the Company no such amendment,  alteration,
suspension, discontinuation, or termination shall be made that would:

          (i)  increase the total number of Common  Shares  available for Awards
               under the Plan, except as provided in Section 4 hereof; or

          (ii) otherwise  cause  the  Plan to cease  to  comply  with any tax or
               regulatory requirement, including for these purposes any approval
               or other  requirement  which is or  would be a  prerequisite  for
               exemptive relief from Section 16(b) of the Exchange Act.

     (b) Amendments to Awards.  The Committee may waive any conditions or rights
under, amend any terms of, or alter, suspend, discontinue,  cancel or terminate,
any  Award  theretofore  granted,  prospectively  or  retroactively;   provided,
however,  that,  subject to the Company's rights to adjust Awards under Sections
7(c)  and  (d),  any   amendment,   alteration,   suspension,   discontinuation,
cancellation  or termination  that would impair the rights of any Participant or
holder or beneficiary of any Award theretofore granted, shall not to that extent
be effective without the consent of such Participant or holder or beneficiary of
an Award, as the case may be.

     (c)  Adjustment  of  Awards  Upon  Certain  Acquisitions.  In the event the
Company or any Affiliate shall assume  outstanding  employee awards or the right
or obligation to make future such awards in connection  with the  acquisition of
another business or another  corporation or business  entity,  the Committee may
make such adjustments, not inconsistent with the terms of the Plan, in the terms
of  Awards  as  it  shall  deem  appropriate  in  order  to  achieve  reasonable
comparability or other equitable relationship between the assumed awards and the
Awards granted under the Plan as so adjusted.

     (d)  Adjustments  of Awards  Upon the  Occurrence  of  Certain  Unusual  or
Nonrecurring  Events.  The Committee is hereby authorized to make adjustments in
the terms and conditions of, and the criteria included in, Awards in recognition
of unusual or non-recurring  events (including,  without limitation,  the events
described in Section 4(b) hereof) affecting the Company,  any Affiliate,  or the
financial  statements  of  the  Company  or  any  Affiliate,  or of  changes  in
applicable laws, regulations,  or accounting principles,  whenever the Committee
determines that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential  benefits intended to be made available
under the Plan.

     SECTION 8. General Provisions.

     (a) No Rights to Awards.  No Employee or other  Person shall have any claim
to be  granted  any  Award  under  the  Plan,  and  there is no  obligation  for
uniformity  of treatment of  Employees,  or holders or  beneficiaries  of Awards
under the Plan.  The terms and  conditions  of Awards  need not be the same with
respect to each recipient.

     (b)  Delegation.  Subject to the terms of the Plan and applicable  law, the
Committee may delegate to one or more officers or managers of the Company or any
Affiliate,  or to a committee  of such  officers  or  managers,  the  authority,
subject to such terms and limitations as the Committee shall determine, to grant
Awards  to,  or  to  cancel,  modify,  waive  rights  with  respect  to,  alter,
discontinue,  suspend,  or terminate Awards;  provided,  however,  that, no such
delegation  shall be permitted  with respect to Awards held by Employees who are
officers or  directors of the Company for purposes of Section 16 of the Exchange
Act,  or any  successor  section  thereto or who are  otherwise  subject to such
Section.

     (c) Correction of Defects,  Omissions,  and Inconsistencies.  The Committee
may correct any defect,  supply any omission,  or reconcile any inconsistency in
the Plan or any Award in the manner and to the extent it shall deem desirable to
carry the Plan into effect.

     (d)  Withholding.  The  Company or any  Affiliate  shall be  authorized  to
withhold from any Award granted, from any payment due or transfer made under any
Award or under  the Plan or from any  compensation  or other  amount  owing to a
Participant the amount (in cash, Common Shares, other securities,  other Awards,
or other  property)  of  withholding  taxes  due in  respect  of an  Award,  its
exercise,  or any payment or transfer  under such Award or under the Plan and to
take such other  action as may be  necessary  in the  opinion of the  Company or
Affiliate to satisfy all obligations for the payment of such taxes.

     (e) No Limit on Other Compensation  Arrangements.  Nothing contained in the
Plan shall prevent the Company or any  Affiliate  from adopting or continuing in
effect other or additional compensation arrangements,  and such arrangements may
be either generally applicable or applicable only in specific cases.

     (f) No Right to Employment. The grant of an Award shall not be construed as
giving a  Participant  the right to be  retained in the employ of the Company or
any  Affiliate.  Further,  the Company or an Affiliate may at any time dismiss a
Participant  from  employment,  free from any liability,  or any claim under the
Plan, unless otherwise expressly provided in the Plan or in any Award Agreement.

     (g) Governing  Law. The validity,  construction  and effect of the Plan and
any rules and regulations relating to the Plan shall be determined in accordance
with the laws of the State of Delaware and applicable Federal law.

     (h)  Severability.  If any provision of the Plan or any Award is or becomes
or is deemed to be invalid,  illegal or  unenforceable in any jurisdiction or as
to any Person or Award under any law deemed  applicable by the  Committee,  such
provision shall be construed or deemed amended to conform to applicable laws, or
if it cannot be construed or deemed amended without, in the determination of the
Committee,  materially  altering  the  intent  of the  Plan or the  Award,  such
provision  shall be  stricken as to such  jurisdiction,  Person or Award and the
remainder of the Plan and any such Award shall remain in full force and effect.

     (i) No Trust or Fund  Created.  Neither the Plan nor any Award shall create
or be  construed  to create a trust or separate  fund of any kind or a fiduciary
relationship between the Company or any Affiliate and a Participant or any other
Person.  To the extent that any Person acquires a right to receive payments from
the  Company or any  Affiliate  pursuant  to an Award,  such  right  shall be no
greater than the right of any unsecured  general  creditor of the Company or any
Affiliate.

     (j) No  Fractional  Common  Shares.  No  fractional  Common Shares shall be
issued or delivered  pursuant to the Plan or any Award,  and the Committee shall
determine  whether cash,  other  securities,  or other property shall be paid or
transferred in lieu of any fractional  Common Shares or whether such  fractional
Common Shares or any rights thereto shall be canceled,  terminated, or otherwise
eliminated.

     (k)  Headings.  Headings are given to the Sections and  subsections  of the
Plan solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or  interpretation of
the Plan or any provision thereof.

     SECTION 9.  Adoption,  Approval and  Effective  Date of the Plan.  The Plan
shall be considered  adopted and shall become  effective on the date the Plan is
approved by the Board;  provided,  however, that the Plan and any Awards granted
under the Plan shall be void, if the  stockholders of the Company shall not have
approved the adoption of the Plan within  twelve (12) months after the effective
date,  by a majority  of votes cast  thereon at a meeting of  stockholders  duly
called and held for such purpose.