AVONDALE INDUSTRIES, INC.
                              1997 STOCK INCENTIVE PLAN


               1.   Purpose.   The purpose of the 1997 Stock Incentive Plan
          (the "Plan") of Avondale  Industries,  Inc.  ("Avondale")  is  to
          increase  shareholder  value  and  to  advance  the  interests of
          Avondale  and  its subsidiaries (collectively, the "Company")  by
          furnishing a variety  of  economic  incentives (the "Incentives")
          designed to attract, retain and motivate  key employees, officers
          and  directors  and  to  strengthen  the mutuality  of  interests
          between such persons and Avondale's shareholders.  Incentives may
          consist of opportunities to purchase or  receive shares of common
          stock,  $1.00  par  value  per  share, of Avondale  (the  "Common
          Stock"), monetary payments or both, on terms determined under the
          Plan.   As  used  in the Plan, the term  "subsidiary"  means  any
          corporation  of which  Avondale  owns  (directly  or  indirectly)
          within the meaning of Section 425(f) of the Internal Revenue Code
          of 1986, as amended  (the  "Code"),  50%  or  more  of  the total
          combined voting power of all classes of stock.

               2.   Administration.

                    1.11834   Composition.   The Plan shall be administered
               by the compensation committee (the "Committee") of the Board
               of Directors of Avondale. The Committee shall consist of not
               fewer than two members of the Board  of  Directors,  each of
               whom  shall  (a)  qualify as a "non-employee director" under
               Rule 16b-3 under the  Securities  Exchange  Act of 1934 (the
               "1934  Act"), as currently in effect or any successor  rule,
               and (b)  qualify  as  an  "outside  director"  under Section
               162(m) of the Code.

                    2.11834  Authority.   The Committee shall have  plenary
               authority to award Incentives  under  the Plan, to interpret
               the Plan, to establish any rules or regulations  relating to
               the Plan that it determines to be appropriate, to enter into
               agreements   with  participants  as  to  the  terms  of  the
               Incentives (the  "Incentive  Agreements")  and  to  make any
               other  determination that it believes necessary or advisable
               for the proper administration of the Plan.  Its decisions in
               matters  relating  to the Plan shall be final and conclusive
               on the Company and participants.  The Committee may delegate
               its authority hereunder  to  the  extent  provided elsewhere
               herein.   The  Committee shall not have authority  to  award
               Incentives under  the  Plan to directors of Avondale who are
               not  also  full-time  employees  of  the  Company  ("Outside
               Directors").  Outside Directors may receive awards under the
               Plan only as specifically provided in Section 10 hereof.

               3.   Eligible  Employees.   Key  employees  of  the  Company
          (including officers and  directors who are full-time employees of
          the  Company,  but  excluding  Outside  Directors)  shall  become
          eligible to receive Incentives  under the Plan when designated by
          the Committee.  Employees may be  designated  individually  or by
          groups  or  categories, as the Committee deems appropriate.  With
          respect to participants not subject to Section 16 of the 1934 Act
          and not covered  employees  under Section 162(m) of the Code, the
          Committee may delegate its authority  to  designate participants,
          to determine the size and type of Incentive  to  be  received  by
          those   participants  and  to  determine  or  modify  performance
          objectives for those participants.

               4.   Types  of  Incentives.  Incentives may be granted under
          the Plan in any of the following forms, either individually or in
          combination:  (a) incentive stock options and non-qualified stock
          options; (b) stock appreciation  rights  ("SARs"); (c) restricted
          stock; and (d) performance shares.

               5.   Shares Subject to the Plan.

                    1.11834  Number of Shares.  Subject  to  adjustment  as
               provided  in  Section  11.5,  a total of 1,430,000 shares of
               Common Stock are authorized to  be  issued  under  the Plan.
               Incentives  with  respect  to no more than 45,000 shares  of
               Common Stock may be granted  through  the  Plan  to a single
               participant in one calendar year.  In the event that a stock
               option,  SAR or performance share granted hereunder  expires
               or is terminated  or cancelled prior to exercise or payment,
               any shares of Common Stock that were issuable thereunder may
               be issued again under the Plan.  In the event that shares of
               Common Stock are issued  as  Incentives  under  the Plan and
               thereafter  are  forfeited  or  reacquired  by  the  Company
               pursuant  to  rights  reserved  upon  issuance thereof, such
               forfeited and reacquired shares may be  issued  again  under
               the  Plan.   If  an  Incentive  is to be paid in cash by its
               terms,  the Committee need not make  a  deduction  from  the
               shares of  Common Stock issuable under the Plan with respect
               thereto.  If and to the extent that an Incentive may be paid
               in cash or shares  of  Common  Stock,  the  total  number of
               shares  available  for issuance hereunder shall be decreased
               by  the  number  of shares  payable  under  such  Incentive,
               provided that upon  any  payment  of  all  or  part  of such
               Incentive in cash, the total number of shares available  for
               issuance  hereunder  shall  be  increased by the appropriate
               number  of  shares  represented  by  the  cash  payment,  as
               determined   in  the  sole  discretion  of  the   Committee.
               Additional  rules  for  determining  the  number  of  shares
               granted under  the  Plan may be made by the Committee, as it
               deems necessary or appropriate.

                    2.11834  Type of  Common  Stock.   Common  Stock issued
               under  the  Plan  may  be authorized and unissued shares  or
               issued shares held as treasury shares.

               6.   Stock Options.  A stock  option  is a right to purchase
          shares  of  Common  Stock from Avondale.  Stock  options  granted
          under this Plan may be  incentive  stock options or non-qualified
          stock options.  Any option that is designated  as a non-qualified
          stock option shall not be treated as an incentive  stock  option.
          Each stock option granted by the Committee under this Plan  shall
          be subject to the following terms and conditions:

                    1.11834  Price.  The exercise price per share shall  be
               determined  by  the  Committee,  subject to adjustment under
               Section 11.5; provided that in no  event  shall  the  option
               price  be  less  than  the  Fair  Market Value of a share of
               Common Stock on the date of grant.

                    2.11834  Number.  The number of  shares of Common Stock
               subject to the option shall be determined  by the Committee,
               subject to adjustment as provided in Section 11.5.

                    3.11834  Duration and Time for Exercise.   The  term of
               each  stock  option  shall  be  determined by the Committee.
               Each stock option shall become exercisable  at  such time or
               times  during  its  term  as  shall  be  determined  by  the
               Committee.   The Committee may accelerate the exercisability
               of any stock option.

                    4.11834  Repurchase.   Upon  approval of the Committee,
               the Company may repurchase a previously granted stock option
               from a participant by mutual agreement  before  such  option
               has  been  exercised  by  payment  to the participant of the
               amount per share by which:  (i) the  Fair  Market  Value (as
               defined in Section 11.12) of the Common Stock subject to the
               option  on  the  date  of purchase exceeds (ii) the exercise
               price.

                    5.11834  Manner of  Exercise.   A  stock  option may be
               exercised, in whole or in part, by giving written  notice to
               the Company, specifying the number of shares of Common Stock
               to  be  purchased.  The exercise notice shall be accompanied
               by the full  purchase  price  for  such  shares.  The option
               price shall be payable in United States dollars  and  may be
               paid  (a)  by  cash,  uncertified or certified check or bank
               draft, (b) by delivery of shares of Common Stock held by the
               optionee for at least six  months  in  payment of all or any
               part of the option price, which shares shall  be  valued for
               this  purpose  at  the  Fair  Market  Value on the date such
               option is exercised, (c) by delivering  a  properly executed
               exercise notice together with irrevocable instructions  to a
               broker  approved by the Company (with a copy to the Company)
               to promptly  deliver  to  the  Company the amount of sale or
               loan proceeds to pay the exercise price or (d) in such other
               manner  as  may  be authorized from  time  to  time  by  the
               Committee.  In the  case of delivery of an uncertified check
               upon exercise of a stock  option,  no shares shall be issued
               until  the  check  has  been  paid in full.   Prior  to  the
               issuance of shares of Common Stock  upon  the  exercise of a
               stock  option,  a  participant  shall  have no rights  as  a
               shareholder.

                    6.11834  Incentive   Stock  Options.    Notwithstanding
               anything in the Plan to the  contrary,  the  following addi-
               tional provisions shall apply to the grant of  stock options
               that are intended to qualify as Incentive Stock  Options (as
               such term is defined in Section 422A of the Code):

                         (1)  Any    Incentive   Stock   Option   agreement
                    authorized under the  Plan  shall  contain  such  other
                    provisions  as  the Committee shall deem advisable, but
                    shall in all events  be  consistent with and contain or
                    be deemed to contain all provisions  required  in order
                    to qualify the options as Incentive Stock Options.

                         (2)  All  Incentive  Stock Options must be granted
                    within ten years from the date  on  which  this Plan is
                    adopted by the Board of Directors.

                         (3)  Unless sooner exercised, all Incentive  Stock
                    Options shall expire no later than ten years after  the
                    date of grant.

                         (4)  The  option price for Incentive Stock Options
                    shall be not less  than  the  Fair  Market Value of the
                    Common  Stock  subject  to the option on  the  date  of
                    grant.

                         (5)  No Incentive Stock  Options  shall be granted
                    to  any  participant  who, at the time such  option  is
                    granted, would own (within  the meaning of Section 422A
                    of the Code) stock possessing  more  than  10%  of  the
                    total  combined voting power of all classes of stock of
                    the employer corporation or of its parent or subsidiary
                    corporation.

                         (6)  The  aggregate  Fair Market Value (determined
                    with respect to each Incentive  Stock  Option as of the
                    time  such  Incentive Stock Option is granted)  of  the
                    Common Stock  with  respect  to  which  Incentive Stock
                    Options  are  exercisable  for  the  first  time  by  a
                    participant during any calendar year (under the Plan or
                    any   other   plan   of  the  Company  or  any  of  its
                    subsidiaries) shall not exceed $100,000.  To the extent
                    this $100,000 limitation  is exceeded, the options that
                    relate to the excess shall  be treated as non-qualified
                    stock options.

               7.   Restricted Stock.

                    1.6 Grant of Restricted Stock.  The Committee may award
               shares  of restricted stock to such  key  employees  as  the
               Committee determines to be eligible pursuant to the terms of
               Section 3.   An  award of restricted stock may be subject to
               the attainment of  specified  performance  goals or targets,
               restrictions on transfer, forfeitability provisions and such
               other terms and conditions as the Committee  may  determine,
               subject  to  the  provisions  of  the  Plan.   To the extent
               restricted stock is intended to qualify as performance based
               compensation under Section 162(m) of the Code, it  must meet
               the additional requirements imposed thereby.

                    2.6  The  Restricted  Period.  At the time an award  of
               restricted stock is made, the  Committee  shall  establish a
               period  of  time during which the transfer of the shares  of
               restricted  stock   shall  be  restricted  (the  "Restricted
               Period").   Each  award  of  restricted  stock  may  have  a
               different Restricted  Period.   A  Restricted  Period  of at
               least three years is required, except that if vesting of the
               shares is subject to the attainment of specified performance
               goals, a Restricted Period of one year or more is permitted.
               The expiration of the Restricted Period shall also occur  as
               provided under Section 11.11.

                    3.6 Escrow.  The participant receiving restricted stock
               shall  enter  into  an  Incentive Agreement with the Company
               setting forth the conditions  of  the  grant.   Certificates
               representing shares of restricted stock shall be  registered
               in  the  name  of  the  participant  and  deposited with the
               Company, together with a stock power endorsed  in  blank  by
               the  participant.  Each such certificate shall bear a legend
               in substantially the following form:

                    The  transferability  of  this certificate and the
                    shares  of  Common  Stock  represented  by  it  is
                    subject  to  the  terms and conditions  (including
                    conditions  of  forfeiture)   contained   in   the
                    Avondale  Industries,  Inc.  1997  Stock Incentive
                    Plan  (the  "Plan") and an agreement entered  into
                    between   the  registered   owner   and   Avondale
                    Industries,  Inc.  thereunder.  Copies of the Plan
                    and the agreement are  on  file  and available for
                    inspection at the principal office of the Company.

                    4.6 Dividends on Restricted Stock.   Any  and  all cash
               and  stock  dividends  paid  with  respect  to the shares of
               restricted  stock  shall  be subject to any restrictions  on
               transfer,   forfeitability   provisions    or   reinvestment
               requirements  as  the  Committee  may,  in  its  discretion,
               prescribe in the Incentive Agreement.

                    5.6 Forfeiture.  In the event of the forfeiture  of any
               shares  of restricted stock under the terms provided in  the
               Incentive  Agreement  (including  any  additional  shares of
               restricted  stock  that may result from the reinvestment  of
               cash and stock dividends,  if  so  provided in the Incentive
               Agreement), such forfeited shares shall  be  surrendered and
               the certificates cancelled.  The participants shall have the
               same  rights  and  privileges,  and be subject to  the  same
               forfeiture provisions, with respect to any additional shares
               received pursuant to Section 11.5 due to a recapitalization,
               merger or other change in capitalization.

                    6.6  Expiration  of  Restricted   Period.    Upon   the
               expiration  or  termination of the Restricted Period and the
               satisfaction  of any  other  conditions  prescribed  by  the
               Committee or at such earlier time as provided for in Section
               7.2 and in the  Incentive Agreement or an amendment thereto,
               the restrictions  applicable  to  the restricted stock shall
               lapse and a stock certificate for the  number  of  shares of
               restricted stock with respect to which the restrictions have
               lapsed shall be delivered, free of all such restrictions and
               legends other than those required by law, to the participant
               or the participant's estate, as the case may be.

                    7.6 Rights as a Shareholder.  Subject to the terms  and
               conditions  of  the  Plan and subject to any restrictions on
               the  receipt  of  dividends  that  may  be  imposed  in  the
               Incentive Agreement,  each  participant receiving restricted
               stock  shall  have  all the rights  of  a  shareholder  with
               respect to shares of  stock  during any period in which such
               shares  are  subject  to  forfeiture   and  restrictions  on
               transfer, including without limitation,  the  right  to vote
               such shares.

               8.   Stock  Appreciation  Rights.   A  SAR  is  a  right  to
          receive,  without  payment  to the Company, a number of shares of
          Common  Stock, cash or any combination  thereof,  the  amount  of
          which is  determined pursuant to the formula set forth in Section
          8.4.  A SAR  may  be granted (a) with respect to any stock option
          granted under the Plan,  either  concurrently  with  the grant of
          such  stock  option  or at such later time as determined  by  the
          Committee (as to all or any portion of the shares of Common Stock
          subject to the stock option),  or (b) alone, without reference to
          any related stock option.  Each  SAR  granted  by  the  Committee
          under  the  Plan  shall  be  subject  to  the following terms and
          conditions:

                    1.6 Number.  Each SAR granted to  any participant shall
               relate to such number of shares of Common  Stock as shall be
               determined  by  the  Committee, subject to Section  5.1  and
               subject to adjustment  as  provided in Section 11.5.  In the
               case of a SAR granted with respect  to  a  stock option, the
               number of shares of Common Stock to which the  SAR  pertains
               shall  be reduced in the same proportion that the holder  of
               the option exercises the related stock option.

                    2.6  Duration  and  Time  for  Exercise.   The term and
               exercisability  of  each  SAR  shall  be  determined by  the
               Committee.   Unless otherwise provided by the  Committee  in
               the Incentive  Agreement, each SAR issued in connection with
               a stock option shall  become exercisable at the same time or
               times, to the same extent  and  upon  the same conditions as
               the  related  stock  option.   The  Committee   may  in  its
               discretion accelerate the exercisability of any SAR  at  any
               time.

                    3.6  Exercise.   A SAR may be exercised, in whole or in
               part, by giving written  notice  to  the Company, specifying
               the number of SARs that the holder wishes  to exercise.  The
               Company  shall,  within  30  days  of receipt of  notice  of
               exercise, deliver to the exercising  holder certificates for
               the shares of Common Stock or cash or both, as determined by
               the Committee, to which the holder is  entitled  pursuant to
               Section 8.4.

                    4.6 Payment.  Subject to the right of the Committee  to
               deliver  cash  in lieu of shares of Common Stock, the number
               of shares of Common  Stock  that  shall be issuable upon the
               exercise of an SAR shall be determined by dividing:

                         (1) the number of shares  of  Common  Stock  as to
                    which  the  SAR  is  exercised multiplied by the dollar
                    amount of the appreciation  in  such  shares  (for this
                    purpose,  the  "appreciation"  shall  be the amount  by
                    which  the  Fair Market Value of the shares  of  Common
                    Stock subject  to  the SAR on the Exercise Date exceeds
                    (1) in the case of a SAR related to a stock option, the
                    purchase price of the  shares of Common Stock under the
                    stock option or (2) in the case of a SAR granted alone,
                    without reference to a related  stock option, an amount
                    equal to the Fair Market Value of  a  share  of  Common
                    Stock  on  the date of grant, which shall be determined
                    by the Committee  at  the  time  of  grant,  subject to
                    adjustment under Section 11.5); by

                         (2)  the  Fair  Market  Value of a share of Common
                    Stock on the Exercise Date.

                    In  lieu  of issuing shares of Common  Stock  upon  the
               exercise of a SAR, the Committee may elect to pay the holder
               of the SAR cash  equal  to  the  Fair  Market  Value  on the
               Exercise  Date  of  any  or all of the shares that otherwise
               would be issuable.  No fractional  shares  of  Common  Stock
               shall  be  issued  upon  the exercise of a SAR; instead, the
               holder  of  a  SAR  shall  be entitled  to  receive  a  cash
               adjustment equal to the same  fraction  of  the  Fair Market
               Value of a share of Common Stock on the Exercise Date  or to
               purchase the portion necessary to make a whole share at  its
               Fair Market Value on the Exercise Date.

               9.   Performance Shares.  A performance share consists of an
          award  that  may be paid in shares of Common Stock or in cash, as
          described below.   The  award  of  performance  shares  shall  be
          subject  to  such  terms  and  conditions  as the Committee deems
          appropriate.

                    1.2  Performance  Objectives.  Each  performance  share
               will be subject to performance  objectives  for  Avondale or
               one  of  its  subsidiaries, divisions or departments  to  be
               achieved by the  end  of  a specified period.  The number of
               performance  shares  awarded  shall  be  determined  by  the
               Committee and may be subject to such terms and conditions as
               the Committee shall determine. If the performance objectives
               are achieved, each participant  will be paid (a) a number of
               shares of Common Stock equal to the  number  of  performance
               shares  initially  granted to that participant; (b)  a  cash
               payment equal to the  Fair  Market  Value  of such number of
               shares   of   Common  Stock  on  the  date  the  performance
               objectives are  met or such other date as may be provided by
               the Committee or (c) a combination of shares of Common Stock
               and cash, as may  be  provided  by  the  Committee.  If such
               objectives are not met, each award of performance shares may
               provide  for  lesser  payments  in accordance  with  a  pre-
               established formula set forth in  the  Incentive  Agreement.
               Notwithstanding the foregoing, unless otherwise provided  in
               the Incentive Agreement, the Committee may in its discretion
               declare  the  performance objectives achieved or waived.  To
               the extent a performance  share  is  intended  to qualify as
               performance based compensation under Section 162(m)  of  the
               Code,  it  must  meet  the  additional  requirements imposed
               thereby.

                    2.2 Not a Shareholder.  The award of performance shares
               to a participant shall not create any rights in such partic-
               ipant as a shareholder of the Company, until  the payment of
               shares  of Common Stock with respect to an award,  at  which
               time such stock shall be considered issued and outstanding.

                    3.2  Dividend Equivalent Payments.  A performance share
               award may be  granted  by  the Committee in conjunction with
               dividend equivalent payment  rights  or  other  such rights.
               Dividend  equivalent payments may be made to the participant
               at the time  of  the  payment of the dividend or issuance of
               the other right or at the  end  of the specified performance
               period  or  may  be  deemed  to  be invested  in  additional
               performance shares at the Fair Market  Value  of  a share of
               Common  Stock  on  the  date  of payment of the dividend  or
               issuance of the right.

               10.  Stock Options for Outside Directors

                    1.2  Eligibility.   Each  Outside   Director  shall  be
               automatically  granted  a  non-qualified  stock   option  to
               acquire  1,065  shares  of Common Stock on the day following
               the annual meeting of shareholders  beginning  with the 1997
               annual  meeting  of shareholders and thereafter on  the  day
               following subsequent  annual meetings of shareholders for as
               long as the Plan remains  in  effect  and  shares  of Common
               Stock remain available for grant under Section 5.1 hereof.

                    2.2 Exercisability of Stock Options.  The stock options
               granted  to  Outside  Directors  under this Section 10 shall
               become exercisable as follows:

                    25% of the total number of shares  covered by
                    the  stock  options beginning one year  after
                    the date of grant;

                    50% of the total  number of shares covered by
                    the stock options beginning  two  years after
                    the date of grant, less any shares previously
                    issued;

                    75% of the total number of shares covered  by
                    the stock options beginning three years after
                    the date of grant, less any shares previously
                    issued;

                    100% of the total number of shares covered by
                    the  stock options beginning four years after
                    the date of grant, less any shares previously
                    issued;

               provided, however,  that  such  stock  options  shall become
               immediately exercisable under 11.11 hereof and in the event
               of  retirement from the Board on or after reaching  age  65,
               death  or disability.  No stock option granted to an Outside
               Director under the terms of this Section 10 may be exercised
               more than ten years after the date of grant.

                    3.2  Exercise  Price.   The per share exercise price of
               stock options granted to Outside Directors shall be equal to
               100% of the Fair Market Value  as  defined in the Plan, of a
               share of Common Stock on the date of grant.

                    4.2 Exercise after Termination  of  Board  Service.  In
               the  event that an Outside Director ceases to serve  on  the
               Board of Directors for any reason, the stock options granted
               hereunder   must  be  exercised,  to  the  extent  otherwise
               exercisable, within one year from the date of termination of
               Board service,  but  in  no event later than ten years after
               the date of grant.

                11. General.

                    1.2 Duration.  Subject to Section 11.10, the Plan shall
               remain in effect until all Incentives granted under the Plan
               have either been satisfied  by  the  issuance  of  shares of
               Common Stock or the payment of cash or been terminated under
               the terms of the Plan and all restrictions imposed on shares
               of Common Stock in connection with their issuance under  the
               Plan have lapsed.

                    2.2  Transferability  of Incentives.  Options, SARs and
               performance  shares  granted  under  the  Plan  may  not  be
               transferred except:

                         (1)  by will;

                         (2) by the laws of descent and distribution; or

                         (3)  in  the  case  of  stock   options  only,  if
                    permitted  by  the  Committee  and so provided  in  the
                    Incentive  Agreement  or  an  amendment   thereto,  (i)
                    pursuant to a domestic relations order, as  defined  in
                    the  Code, (ii) to Immediate Family Members, (iii) to a
                    partnership  in  which  Immediate  Family  Members,  or
                    entities in which Immediate Family Members are the sole
                    owners,  members  or beneficiaries, as appropriate, are
                    the only partners,  (iv) to a limited liability company
                    in which Immediate Family Members, or entities in which
                    Immediate Family Members  are  the sole owners, members
                    or beneficiaries, as appropriate, are the only members,
                    or  (v)  to a trust for the sole benefit  of  Immediate
                    Family Members.   "Immediate  Family  Members" shall be
                    defined  as the spouse and natural or adopted  children
                    or grandchildren  of the participant and their spouses.
                    To  the  extent  that  an  incentive  stock  option  is
                    permitted to be transferred  during the lifetime of the
                    participant, it shall be treated  thereafter  as a non-
                    qualified stock option.

               Stock  options  or SARs may be exercised during the lifetime
               of  a  participant   only   by   the   participant,  by  the
               participant's guardian or legal representative  or,  in  the
               case of stock options, by a permitted transferee as provided
               in  (c)  above.  Any attempted assignment, transfer, pledge,
               hypothecation  or other disposition of an Incentive, or levy
               of attachment or  similar  process  upon  the  Incentive not
               specifically  permitted herein, shall be null and  void  and
               without effect.

                    3.3 Effect  of  Termination of Employment or Death.  In
               the  event that an employee  participant  ceases  to  be  an
               employee  of  the  Company  for any reason, including death,
               disability,  early  retirement  or  normal  retirement,  any
               Incentives may be exercised,  shall  vest or shall expire at
               such  times  as may be determined by the  Committee  in  the
               Incentive Agreement.

                    4.3 Additional Condition.  Anything in this Plan to the
               contrary notwithstanding:   (a) the Company may, if it shall
               determine it necessary or desirable  for  any reason, at the
               time of award of any Incentive or the issuance of any shares
               of  Common  Stock  pursuant  to any Incentive,  require  the
               recipient of the Incentive, as  a  condition  to the receipt
               thereof  or to the receipt of shares of Common Stock  issued
               pursuant thereto,  to  deliver  to  the  Company  a  written
               representation of present intention to acquire the Incentive
               or  the  shares of Common Stock issued pursuant thereto  for
               his own account for investment and not for distribution; and
               (b) if at  any  time  the Company further determines, in its
               sole   discretion,  that  the   listing,   registration   or
               qualification  (or any updating of any such document) of any
               Incentive or the  shares  of  Common Stock issuable pursuant
               thereto is necessary on any securities exchange or under any
               federal or state securities or  blue  sky  law,  or that the
               consent or approval of any governmental regulatory  body  is
               necessary  or  desirable as a condition of, or in connection
               with the award of  any  Incentive, the issuance of shares of
               Common  Stock  pursuant  thereto,  or  the  removal  of  any
               restrictions imposed on such  shares,  such  Incentive shall
               not be awarded or such shares of Common Stock  shall  not be
               issued  or  such  restrictions  shall not be removed, as the
               case  may  be,  in whole or in part,  unless  such  listing,
               registration, qualification,  consent or approval shall have
               been  effected  or  obtained  free  of  any  conditions  not
               acceptable to the Company.

                    5.3   Adjustment.   In  the  event   of   any   merger,
               consolidation  or  reorganization  of  the  Company with any
               other   corporation   or   corporations,   there  shall   be
               substituted  for  each  of the shares of Common  Stock  then
               subject   to   the  Plan,  including   shares   subject   to
               restrictions, options,  or  achievement of performance share
               objectives, the number and kind  of shares of stock or other
               securities  to which the holders of  the  shares  of  Common
               Stock will be  entitled pursuant to the transaction.  In the
               event of any recapitalization,  stock dividend, stock split,
               combination of shares or other change  in  the Common Stock,
               the  number  of shares of Common Stock then subject  to  the
               Plan, including  shares  subject  to outstanding Incentives,
               shall be adjusted in proportion to the change in outstanding
               shares  of  Common  Stock.   In  the  event   of   any  such
               adjustments,   the   purchase   price  of  any  option,  the
               performance objectives of any Incentive,  and  the shares of
               Common  Stock  issuable pursuant to any Incentive  shall  be
               adjusted as and to the extent appropriate, in the reasonable
               discretion of the  Committee,  to  provide participants with
               the same relative rights before and after such adjustment.

                    6.3 Incentive Agreements.  The  terms of each Incentive
               shall be stated in an agreement approved by the Committee.

                     7.3 Withholding.  At any time that  a  participant  is
               required  to  pay  to  the  Company an amount required to be
               withheld under the applicable  income tax laws in connection
               with the issuance of shares of Common  Stock  under the Plan
               or  upon  the lapse of restrictions on shares of  restricted
               stock, the participant may, subject to the Committee's right
               of disapproval,  satisfy this obligation in whole or in part
               by electing (the "Election")  to  have  the Company withhold
               from the distribution shares of Common Stock  having a value
               equal to the amount required to be withheld.  The  value  of
               the  shares withheld shall be based on the Fair Market Value
               of the Common Stock on the date that the amount of tax to be
               withheld shall be determined (the "Tax Date").

                    Each  Election must be made prior to the Tax Date.  The
               Committee may  disapprove  of any Election or may suspend or
               terminate the right to make  Elections.   If  a  participant
               makes  an  election  under  Section  83(b)  of  the Internal
               Revenue Code with respect to shares of restricted  stock, an
               Election is not permitted to be made.

                    A  participant  may  also satisfy his or her total  tax
               liability related to an Incentive  by  delivering  shares of
               Common Stock that have been owned by the participant  for at
               least  six  months.  The value of the shares delivered shall
               be based on the Fair Market Value of the Common Stock on the
               Tax Date.

                    8.3 No Continued  Employment.  No participant under the
               Plan  shall  have  any  right,   because   of   his  or  her
               participation, to continue in the employ of the Company  for
               any  period  of  time or to any right to continue his or her
               present or any other rate of compensation.

                      9.3  Deferral   Permitted.    Payment   of   cash  or
               distribution  of  any  shares  of  Common  Stock  to which a
               participant is entitled under any Incentive shall be made as
               provided   in  the  Incentive  Agreement.   Payment  may  be
               deferred at the option of the participant if provided in the
               Incentive Agreement.

                    10.3 Amendment  of  the  Plan.   The Board may amend or
               discontinue the Plan at any time; provided, however, that no
               such  amendment or discontinuance shall  change  or  impair,
               without   the   consent   of  the  recipient,  an  Incentive
               previously granted; and provided  further, that an amendment
               to materially increase the number of  shares of Common Stock
               issuable through the Plan, materially modify the eligibility
               requirements or materially increase the  benefits  under the
               Plan must be approved by the shareholders of the Company.

                    11.3.  Change of Control.

                         (1) A Change of Control shall mean:

                              (1) the acquisition by any individual, entity
                    or  group  (within  the meaning of Section 13(d)(3)  or
                    14(d)(2)  of  the 1934  Act)  of  beneficial  ownership
                    (within the meaning of Rule 13d-3 promulgated under the
                    1934 Act) of more than 25% of the outstanding shares of
                    the Common Stock;  provided, however, that for purposes
                    of  this  subsection (i),  the  following  acquisitions
                    shall not constitute a Change of Control:

                                   a)   any  acquisition  of  Common  Stock
                         directly from the Company,

                                   b) any  acquisition  of  Common Stock by
                         the Company,

                                   c)  any acquisition of Common  Stock  by
                         any  employee  benefit  plan  (or  related  trust)
                         sponsored or maintained  by  the  Company  or  any
                         corporation controlled by the Company, or

                                   d)  any  acquisition  of Common Stock by
                         any  corporation  pursuant  to a transaction  that
                         complies with clauses a), b)  and c) of subsection
                         (iii) of this Section 9.10(a); or

                              (2) individuals who, as of the date this Plan
                    was  adopted by the Board of Directors  (the  "Approval
                    Date"),  constitute  the  Board (the "Incumbent Board")
                    cease for any reason to constitute  at least a majority
                    of  the Board; provided, however, that  any  individual
                    becoming  a  director  subsequent  to the Approval Date
                    whose  election,  or  nomination  for election  by  the
                    shareholders of the Company, was approved  by a vote of
                    at  least  a  majority of the directors then comprising
                    the Incumbent Board shall be considered a member of the
                    Incumbent  Board,   unless  such  individual's  initial
                    assumption of office occurs as a result of an actual or
                    threatened  election  contest   with   respect  to  the
                    election  or  removal of directors or other  actual  or
                    threatened solicitation of proxies or consents by or on
                    behalf of a person other than the Incumbent Board; or

                              (3) consummation  of a reorganization, merger
                    or consolidation, or sale or  other  disposition of all
                    or substantially all of the assets of  the  Company  (a
                    "Business   Combination"),   in   each   case,  unless,
                    following such Business Combination,

                                   a)  all  or  substantially  all  of  the
                         individuals  and  entities who were the beneficial
                         owners of the outstanding  Common  Stock  and  the
                         voting  securities of the Company entitled to vote
                         generally in the election of directors immediately
                         prior to  such Business Combination have direct or
                         indirect beneficial  ownership,  respectively,  of
                         more  than  50%  of the then outstanding shares of
                         common stock, and  more  than  50% of the combined
                         voting  power  of  the  then  outstanding   voting
                         securities  entitled  to  vote  generally  in  the
                         election   of   directors,   of   the  corporation
                         resulting  from such Business Combination  (which,
                         for purposes  of this clause a) and clauses b) and
                         c), shall include  a  corporation that as a result
                         of such transaction owns  the  Company  or  all or
                         substantially  all  of  the  assets of the Company
                         either   directly   or   through   one   or   more
                         subsidiaries), and

                                   b)  except  to  the  extent  that   such
                         ownership    existed   prior   to   the   Business
                         Combination, no  person (excluding any corporation
                         resulting from such  Business  Combination  or any
                         employee  benefit  plan  or  related  trust of the
                         Company  or  such corporation resulting from  such
                         Business Combination)  beneficially owns, directly
                         or indirectly, 20% or more of the then outstanding
                         shares   of  common  stock  of   the   corporation
                         resulting from such Business Combination or 20% or
                         more of the  combined  voting  power  of  the then
                         outstanding voting securities of such corporation,
                         and

                                   c) at least a majority of the members of
                         the   board   of   directors  of  the  corporation
                         resulting  from  such  Business  Combination  were
                         members of the Incumbent  Board at the time of the
                         execution  of  the initial agreement,  or  of  the
                         action of the Board,  providing  for such Business
                         Combination; or

                              (4)  approval  by  the  shareholders  of  the
                    Company   of   a   plan  of  complete  liquidation   or
                    dissolution of the Company.

                         (2) Upon a Change of Control, or immediately prior
                    to the closing of a  transaction  that will result in a
                    Change  of  Control  if  consummated,  all  outstanding
                    options  and  SARs granted pursuant to the  Plan  shall
                    automatically    become    fully    exercisable,    all
                    restrictions or limitations  on  any  Incentives  shall
                    lapse and all performance criteria and other conditions
                    relating  to  the payment of Incentives shall be deemed
                    to be achieved  and  waived by the Company, without the
                    necessity of action by any person.

                         (3) The Committee  may take such other action with
                    respect to an Option or Incentive  as shall be provided
                    in an agreement with the holder thereof.

                    12.3  Definition of Fair Market Value.   Whenever "Fair
               Market  Value"  of  Common  Stock  shall  be determined  for
               purposes  of this Plan, it shall be determined  as  follows:
               (a) if the  Common  Stock  is listed on an established stock
               exchange  or any automated quotation  system  that  provides
               sale quotations,  the  closing sale price for a share of the
               Common Stock on such exchange  or  quotation  system  on the
               applicable  date,  or  if  no sale of the Common Stock shall
               have been made on that day,  on  the  next  preceding day on
               which  there  was  a  sale of the Common Stock; (b)  if  the
               Common Stock is not listed  on  any  exchange  or  quotation
               system,  but  bid and asked prices are quoted and published,
               the mean between  the  quoted  bid  and  asked prices on the
               applicable  date,  and  if  bid  and  asked prices  are  not
               available on such day, on the next preceding  day  on  which
               such  prices were available; and (c) if the Common Stock  is
               not regularly  quoted,  the  fair market value of a share of
               Common Stock on the applicable  date  as  established by the
               Committee in good faith.

          Adopted by the Board of Directors on December 9, 1996.

          Approved by the Shareholders on May 23, 1997.