Document:

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                                                                   Exhibit 10.1

                             R. G. BARRY CORPORATION
                           ASSOCIATES' RETIREMENT PLAN
                            (As Amended and Restated
                           Effective January 1, 1997)

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R. G. BARRY CORPORATION
ASSOCIATES' RETIREMENT PLAN
(As Amended and Restated Effective January 1, 1997)

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CONTENTS

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SECTION                                                                                                        PAGE

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ARTICLE I.  THE PLAN

         1.1      Establishment and Amendment of the Plan.........................................................1
         1.2      Applicability of Plan...........................................................................1

ARTICLE II.  DEFINITIONS

         2.1      Definitions.....................................................................................2
         2.2      Construction....................................................................................9

ARTICLE III.  PARTICIPATION AND SERVICE

         3.1      Active Participation...........................................................................10
         3.2      Participation Status; Membership; Reemployment.................................................10
         3.3      Transferred Employees..........................................................................11
         3.4      Vesting Service................................................................................12
         3.5      Benefit Service................................................................................14
         3.6      Prior Service..................................................................................15
         3.7      Hours of Service...............................................................................16
         3.8      Special Provisions Relating to Acquired Businesses.............................................16
         3.9      Leased Employees...............................................................................17
         3.10     Special Provisions for Participants Who Enter the Armed Forces.................................17
         3.11     Special Provisions for Class A Commissioned Sales Representatives..............................17

ARTICLE IV.  BENEFITS

         4.1      Normal Retirement Benefits.....................................................................18
         4.2      Late Retirement Benefits.......................................................................19
         4.3      Early Retirement Benefits......................................................................20
         4.4      Disability Retirement Benefits.................................................................20
         4.5      Vested Retirement Benefits.....................................................................22
         4.6      Death Benefit..................................................................................24
         4.7      Preretirement Surviving Spouse's Benefit.......................................................24
         4.8      Automatic Joint and Surviving Spouse Annuity...................................................25
         4.9      Normal and Optional Methods of Benefit Payments................................................26
         4.10     Adjustment for In-Service Payments.............................................................28
         4.11     Maximum Annual Benefits........................................................................28
         4.12     Plan in Effect at Termination of Employment Controls...........................................31
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         4.13     Optional Direct Rollovers of Eligible Rollover Distributions...................................32
         4.14     Payment of Small Amounts.......................................................................34
         4.15     Special Commencement Rule For Certain Former Participants......................................34

ARTICLE V.  COMMENCEMENT OF BENEFIT PAYMENTS AND DURATION

         5.1      Commencement and Duration......................................................................36
         5.2      Required and Minimum Distribution Rules........................................................37
         5.3      Reemployment After Benefit Commencement but Prior to Normal Retirement Age.....................39
         5.4      Reemployment After Benefit Commencement and After Attaining Normal Retirement Age..............40
         5.5      Suspension of Benefits Notice and Procedures...................................................41

ARTICLE VI.  PLAN ADMINISTRATION

         6.1      Appointment of Committee.......................................................................42
         6.2      Compensation and Expenses......................................................................42
         6.3      Manner of Action...............................................................................42
         6.4      Chairman, Secretary and Employment of Specialists..............................................43
         6.5      Delegation of Responsibilities.................................................................43
         6.6      Records........................................................................................43
         6.7      Rules..........................................................................................43
         6.8      Administration.................................................................................44
         6.9      Appeals from Denial of Claims..................................................................44
         6.10     Notice of Address and Missing Persons..........................................................45
         6.11     Application for Benefits and Data..............................................................45
         6.12     Indemnity for Liability........................................................................45

ARTICLE VII.  FINANCING

         7.1      Funding........................................................................................47
         7.2      Contributions..................................................................................47

ARTICLE VIII.  AMENDMENT AND TERMINATION

         8.1      Amendment and Termination......................................................................48
         8.2      Limitations on Amendments......................................................................49
         8.3      Distribution on Termination....................................................................49
         8.4      Effect of Contingencies Affecting the Employer.................................................50
         8.5      Restrictions on Benefits and Distributions to Certain Members..................................51

ARTICLE IX.  PARTICIPATION IN AND WITHDRAWAL FROM THE PLAN BY AN EMPLOYER

         9.1      Participation in the Plan......................................................................52
         9.2      Withdrawal from the Plan.......................................................................52
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ARTICLE X.  MISCELLANEOUS

         10.1     Nonalienation..................................................................................54
         10.2     Incompetency...................................................................................54
         10.3     Merger, Consolidation or Transfer..............................................................54
         10.4     Litigation.....................................................................................56
         10.5     Effect of Mistake..............................................................................56
         10.6     No Enlargement of Employee Rights..............................................................56
         10.7     No Guarantee...................................................................................56
         10.8     Internal Revenue Service Approval..............................................................56
         10.9     Exclusive Benefit; Nonreversion................................................................57
         10.10    Applicable Law.................................................................................57
         10.11    Severability...................................................................................58
         10.12    Mistakes.......................................................................................58
         10.13    Qualified Transportation Fringe Payments.......................................................58

ARTICLE XI.  TOP-HEAVY PROVISIONS

         11.1     Application of Top-Heavy Provisions............................................................59
         11.2     Definitions....................................................................................59
         11.3     Vesting Requirements...........................................................................61
         11.4     Minimum Benefit................................................................................62
         11.5     Limit on Annual Additions; Combined Plan Limit.................................................62
         11.6     Collective Bargaining Agreements...............................................................63
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ARTICLE I.  THE PLAN

1.1 ESTABLISHMENT AND AMENDMENT OF THE PLAN

R. G. Barry Corporation ("Sponsor") previously maintained the R. G. Barry
Corporation Salaried Employees' Pension Plan for the benefit of its salaried
employees, which plan was previously established effective January 1, 1973, and
was last restated as a separate plan effective as of January 1, 1989. In
addition, the Sponsor previously maintained as a separate plan the Retirement
Income Plan for Non-Salaried Employees of R. G. Barry Corporation for the
benefit of its nonsalaried, noncommissioned employees, which plan was previously
established effective January 1, 1964, and was last restated as a separate plan
effective as of January 1, 1989. Effective as of January 1, 1996, the Retirement
Income Plan for Non-Salaried Employees of R. G. Barry Corporation was merged
into the R. G. Barry Corporation Salaried Employees' Pension Plan. The combined
plans were amended and restated generally effective as of January 1, 1996, and
became known as the "R. G. Barry Corporation Associates' Retirement Plan"
("Plan"). The Plan is now amended and restated, as set forth herein, effective
as of January 1, 1997 (except to the extent otherwise provided herein).

1.2 APPLICABILITY OF PLAN

The provisions of this Plan as set forth herein are applicable only to the
Eligible Employees (and their surviving Spouses or Beneficiaries) of the
Employer in current employment on or after January 1, 1997. The restated Plan
shall preserve all benefits accrued and not forfeited by Members under the terms
of the Plan prior to this restatement.

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ARTICLE II.  DEFINITIONS

2.1 DEFINITIONS

Whenever used in the Plan, the following terms shall have the respective
meanings set forth below unless otherwise expressly provided herein; and when
the defined meaning is intended, the term is capitalized.

(a)      "ACTUARIAL EQUIVALENT" means a benefit having the same value as the
         benefit which it replaces, computed on the basis of the 1971 Group
         Annuity Mortality Table for Males projected to 1990 by Scale D with an
         age setback of four years for the Participant and two years for any
         Spouse or Beneficiary and a 7 percent annual interest rate assumption,
         except as otherwise specified in the document. For purposes of
         determining the Actuarial Equivalent present value and single sum
         amount of a Member's monthly Retirement Benefit [and for purposes of
         Section 5.1(b)], subject to the limitations of Sections 4.9 and 8.2,
         such determination shall be made using:

         (1)      the annual interest rate set forth in Code Section 417(e) for
                  the second full month preceding the first day of the Plan
                  Year, which rate shall remain constant for the Plan Year; and

         (2)      the mortality projections taken from the 1983 Group Annuity
                  Mortality Table with a 50 percent male and 50 percent female
                  weighting of the mortality rates as described in Revenue
                  Ruling 95-6 or the successor mortality tables as prescribed by
                  the Secretary of the Treasury;

         provided, however, that prior to January 1, 1997, such determination
         shall be made on the basis of the 1971 Group Annuity Mortality Table
         for Males projected to 1990 by Scale D with an age setback of four
         years for the Participant and two years for any Spouse or Beneficiary
         and using an interest rate not greater than--

                  (A)      the "applicable interest rate" if the present value
                           of such Benefit (using such rate) is not in excess of
                           $25,000; or

                  (B)      120 percent of the "applicable interest rate" if the
                           present value of such Benefit exceeds $25,000 [as
                           determined under (A) above]. In no event shall the
                           present value determined under this Section 2.1(a)(B)
                           be less than $25,000.

         For purposes of this Section 2.1(a)(A) and (B), "applicable interest
         rate" shall mean the interest rate or rates which would be used by the
         Pension Benefit Guaranty Corporation for purposes of determining the
         present value of a Member's lump sum benefit under the Plan if the Plan
         had terminated on the date distribution commences with insufficient
         assets to provide benefits guaranteed by the Pension Benefit Guaranty
         Corporation ("PBGC") on such date, provided that the "applicable
         interest rate" shall be determined

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         as of the second calendar month preceding the month in which the single
         sum is payable rather than as of the date distribution commences.

         Notwithstanding the preceding provisions of this Section 2.1(a), for
         distributions beginning on any date in 1997, the annual rate of 30-year
         Treasury securities under Section 2.1(a)(1) shall be determined as of
         the second full month preceding the first day of the Plan Year in which
         the distribution commences or as of the second calendar month preceding
         the month in which the single sum is payable, whichever results in the
         larger Actuarial Equivalent.

         The foregoing assumptions shall be used for benefit calculations but
         shall not restrict the right of the Sponsor and the Actuary to use
         different assumptions for determining the appropriate funding of the
         Plan. In the event of a termination of the Plan, this Section 2.1(a)
         shall be subject to the regulations of the PBGC.

(b)      "ACTUARY" means the actuary for the Plan who is appointed or selected
         by the Committee but is independent of the Sponsor. The Actuary
         designated shall serve for so long as shall be mutually agreeable to
         the Committee and the Actuary. The Actuary shall be a person who is an
         "enrolled actuary" under ERISA, or shall be an actuarial consulting
         firm or corporation which employs or has on its staff such an enrolled
         actuary.

(c)      "AFFILIATE" means--

         (1)      any corporation other than the Sponsor, i.e., either a
                  subsidiary corporation or an affiliated or associated
                  corporation of the Sponsor, which together with the Sponsor is
                  a member of a "controlled group" of corporations [as defined
                  in Code Section 414(b)];

         (2)      any organization which together with the Sponsor is under
                  "common control" [as defined in Code Section 414(c)];

         (3)      any organization which together with the Sponsor is an
                  "affiliated service group" [as defined in Code Section
                  414(m)];

         (4)      any organization required to be aggregated with an Employer
                  pursuant to Code Section 414(o); or

         (5)      any other corporation or entity designated as an Affiliate by
                  resolution of the Board of Directors of the Sponsor.

(d)      "ANNUITY STARTING DATE" means, in the case of benefits payable in the
         form of an annuity, the earlier of the first day of the first period
         for which a benefit is payable under the Plan; or the date on which a
         Member, surviving Spouse or Beneficiary begins to receive benefits
         under the Plan. In the case of a benefit payable in the form of a
         single sum payment, Annuity Starting Date means the date on which all
         events have occurred which entitle the Member to receive such benefit.

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(e)      "AUTOMATIC JOINT AND SURVIVING SPOUSE ANNUITY" means the annuity form
         of benefit payments described in Section 4.8.

(f)      "BENEFICIARY" means the person or persons designated under Section
         4.9(c).

(g)      "BOARD OF DIRECTORS" means the Board of Directors of the Sponsor.

(h)      "CODE" means the Internal Revenue Code of 1986 and the regulations
         issued thereunder, as amended from time to time.

(i)      "COMMITTEE" means the committee which is responsible for the
         administration of the Plan, as provided in Article VI.

(j)      "COMPENSATION" means a Participant's pay, determined as follows:

         (1)      For all purposes under the Plan, except as otherwise
                  specified, Compensation means:

                  (A)      for Plan Years beginning on or after January 1, 1991,
                           the Participant's salary and excludes overtime, cash
                           bonuses, and sales incentive payments.

                  (B)      for Plan Years beginning before January 1, 1991, the
                           Participant's salary and commissions, but shall
                           exclude overtime and cash bonuses as well as
                           commissions while a Class A salesman.

         (2)      For purposes of applying the limitations described in Section
                  4.11, the definition of Highly Compensated Employee and the
                  provisions of Article XI, Compensation means the Member's
                  "compensation" as defined in Code Section 415(c)(3), including
                  amounts set forth in Code Section 415(c)(3)(D), excluding for
                  Plan Years and Limitation Years beginning prior to January 1,
                  2001, amounts set forth in Section 132(f)(4) of the Code, as
                  determined by the Committee.

         Notwithstanding the foregoing provisions of this Section 2.1(j), the
         Compensation of each Employee that may be taken into account under the
         Plan shall not exceed the first "applicable dollar amount" of an
         Employee's annual Compensation; provided, however, that such annual
         dollar limitation shall not apply to Compensation for purposes of
         Section 4.11. For purposes of this Section 2.1(j), the term "applicable
         dollar amount" means the maximum annual compensation limit set forth in
         Code Section 401(a)(17)(A), as adjusted for the cost of living in
         accordance with Code Section 401(a)(17)(B).

(k)      "EFFECTIVE DATE" of this amended and restated Plan means, except where
         separately stated, January 1, 1997.

(l)      "ELIGIBILITY SERVICE" means the service of an Employee, as determined
         under Section 3.1.

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(m)      "ELIGIBLE EMPLOYEE" means any Salaried Employee or Nonsalaried Employee
         of an Employer.

(n)      "EMPLOYEE" means a person who is classified by the Sponsor or an
         Affiliate as an employee; excluding, however, any person who is
         classified by the Sponsor or an Affiliate as an independent contractor
         or leased employee (as defined in Section 3.9). If an individual who is
         not classified by the Employer or an Affiliate as a common law employee
         is determined by a court of law or governmental agency to be a common
         law employee, such Employee will remain excluded from participation in
         the Plan unless otherwise provided pursuant to Section 3.9.

(o)      "EMPLOYER" means the Sponsor or any Affiliate which has elected to
         become a participating Employer under the Plan in accordance with
         Article IX.

(p)      "EMPLOYMENT COMMENCEMENT DATE" means the first day on which an Employee
         is credited with an Hour of Service with the Employer or an Affiliate
         or, if applicable, the first day following a Break in Service on which
         an Employee is credited with an Hour of Service with the Employer or an
         Affiliate.

(q)      "ERISA" means the Employee Retirement Income Security Act of 1974 and
         the regulations issued thereunder, as amended from time to time.

(r)      "FINAL AVERAGE COMPENSATION" means one-sixtieth of the Participant's
         total Compensation for the highest five consecutive Plan Years out of
         the last ten consecutive Plan Years of employment as a Salaried
         Employee with an Employer; provided that if he has fewer than five Plan
         Years of employment as a Salaried Employee with an Employer, then his
         Final Average Compensation shall be determined using such Participant's
         total period of employment as a Salaried Employee with the Employer and
         the actual number of months worked. With respect to a reemployed
         Participant, the period during which he is not employed as a Salaried
         Employee by an Employer shall not be considered an interruption for
         purposes of the meaning of "consecutive."

(s)      "HIGHLY COMPENSATED EMPLOYEE" means, with respect to any Plan Year, any
         Employee who--

         (1)      was a 5-percent owner [as determined under Code Section
                  416(i)(1)] at any time during the current or preceding Plan
                  Year; or

         (2)      received Compensation in the preceding Plan Year from the
                  Employers and Affiliates in excess of $80,000 (or such
                  increased amount as permitted by the Secretary of the
                  Treasury) and who, at the election of the Committee, was in
                  the "top-paid group" [as defined by Code Section 414(q)(3)]
                  during such year.

(t)      "HOUR OF SERVICE" means the hours for which an Employee shall receive
         credit for various purposes under the Plan, as described in Section
         3.7.

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(u)      "LEAVE OF ABSENCE" means any absence without pay, authorized on a
         nondiscriminatory basis by an Employer or nonparticipating Affiliate
         under its standard personnel practices (which may be granted for
         reasons other than termination of employment, discharge, retirement or
         death), such as illness, accident, emergency or other unusual condition
         affecting the Employee or persons dependent upon him or for any reason
         sufficient in the discretion of the Sponsor; provided, however, that in
         granting leaves of absence, all Employees shall be treated alike.

(v)      "MEMBER" means an Active Participant, an Inactive Participant or a
         Former Participant who is entitled to receive a Retirement Benefit
         under the Plan, as provided in Section 3.2.

(w)      "NONSALARIED BENEFIT SERVICE" means the service of a Nonsalaried
         Participant as determined under Section 3.5.

(x)      "NONSALARIED EMPLOYEE" or "NONSALARIED PARTICIPANT" means an Employee
         or Participant, respectively, who is not compensated by a salary paid
         on a biweekly basis and who is not compensated by commissions.

(y)      "PARTICIPANT" means an "Active Participant" or "Inactive Participant,"
         as such terms are defined in Section 3.2. The term "Former Participant"
         shall have the meaning provided for in Section 3.2.

(z)      "PLAN" means the R. G. BARRY CORPORATION ASSOCIATES' RETIREMENT PLAN,
         as amended and restated generally effective as of January 1, 1997, and
         as may be subsequently amended from time to time.

(aa)     "PLAN YEAR" means the 12-consecutive-month period beginning January 1
         of a year and ending on December 31 of the same year.

(bb)     "PRERETIREMENT SURVIVING SPOUSE'S BENEFIT" means the monthly benefit
         payable to a Member's surviving Spouse, as described in Section 4.7.

(cc)     "PRIMARY SOCIAL SECURITY BENEFIT" means the estimated monthly primary
         insurance amount to which a Participant would be entitled at age 65 if
         not otherwise disqualified under the Federal Social Security Act as
         amended, whether or not he applies for or actually receives such
         benefit. For purposes of the Plan, such estimated amount prior to his
         Normal Retirement Date shall be determined based upon the method of
         calculations described below.

         In determining the Primary Social Security Benefit under this Plan, the
         Social Security Act as in effect on January 1 of the then current
         calendar year shall be applied. Wage history prior to employment with
         the Employer shall be estimated by applying a salary scale with the
         salary scale to be the actual change in the average national wages as
         determined by the Social Security Administration. For any year in which
         the Social Security Administration has not published the increase in
         national average wages, a six

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         percent increase shall be assumed. Wages for future years shall be
         assumed to be the same as the wages received in the last full calendar
         year of employment.

         Provided, however, that any Participant shall be permitted to have his
         actual salary history used as of the date of the calculation if the
         Participant supplies documentation of that history. Such documentation
         must be provided no later than a reasonable period of time (as
         established by the Committee) following the later of the date of
         separation from service (by retirement or otherwise) and the time when
         the Participant is notified of the benefit to which he is entitled. To
         the extent required by applicable law, the Committee shall furnish each
         Member with a written notice of his right to supply actual past wages
         and the financial effect of his failure to supply such actual wage
         information.

         Post-separation increases in a Member's Social Security benefit shall
         not affect the Retirement Benefits determined under this Plan.

(dd)     "PRIOR PLANS" means the R. G. Barry Corporation Salaried Employees'
         Pension Plan and the Retirement Income Plan for Non-Salaried Employees
         of R. G. Barry Corporation.

(ee)     "RETIREMENT AGE" means a Member's Normal Retirement Age, Early
         Retirement Age or Vested Retirement Age, whichever is applicable, as
         follows:

         (1)      "NORMAL RETIREMENT AGE" means the sixty-fifth birthday of a
                  Participant.

         (2)      "EARLY RETIREMENT AGE" means a Member's age when he has
                  attained his fifty-fifth birthday (but not his sixty-fifth
                  birthday) and he is credited with at least ten years of
                  Vesting Service.

         (3)      "VESTED RETIREMENT AGE" means a Member's age when he is
                  credited with at least five years of Vesting Service but has
                  not attained his Early Retirement Age.

(ff)     "RETIREMENT BENEFIT" means the monthly benefit payment to which a
         Member is entitled under whichever of the following is applicable to
         the Member:

         (1)      "NORMAL RETIREMENT BENEFIT" means the monthly benefit
                  described in Section 4.1.

         (2)      "LATE RETIREMENT BENEFIT" means the monthly benefit described
                  in Section 4.2.

         (3)      "EARLY RETIREMENT BENEFIT" means the monthly benefit described
                  in Section 4.3.

         (4)      "DISABILITY RETIREMENT BENEFIT" means the monthly benefit
                  described in Section 4.4.

         (5)      "VESTED RETIREMENT BENEFIT" means the monthly benefit
                  described in Section 4.5.

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(gg)     "RETIREMENT DATE" means a Member's Normal Retirement Date, Late
         Retirement Date or Early Retirement Date, whichever is applicable, as
         follows:

         (1)      "NORMAL RETIREMENT DATE" means the first day of the calendar
                  month coincident with or next following the date on which a
                  Member attains his Normal Retirement Age.

         (2)      "LATE RETIREMENT DATE" means the first day of the calendar
                  month coincident with or next following the date a Participant
                  terminates his employment as an Employee after his Normal
                  Retirement Date.

         (3)      "EARLY RETIREMENT DATE" means the first day of the calendar
                  month coincident with or next following the date a Participant
                  terminates his employment as an Employee on or after attaining
                  his Early Retirement Age but before his Normal Retirement Age.
                  An Early Retirement Date may also be such later date as
                  provided in Section 5.1(a)(2).

         (4)      "DISABILITY RETIREMENT DATE" means the first day of the
                  calendar month coincident with or next following the date on
                  which the Committee determines that a Nonsalaried Participant
                  has a Disability, as described in Section 4.4(a).

         (5)      "VESTED RETIREMENT DATE" means for a Participant who
                  terminates his employment as an Employee on or after he
                  attains his Vested Retirement Age, and who is not eligible for
                  a Normal Retirement Benefit, Early Retirement Benefit or
                  Disability Retirement Benefit as a result of such termination
                  of employment, the Participant's Normal Retirement Date;
                  provided, however, if such Participant was credited with at
                  least 10 years of Vesting Service prior to the termination of
                  his employment as an Employee, his Vested Retirement Date
                  shall be the first day of any calendar month coincident with
                  or next following his fifty-fifth birthday for which he makes
                  application for his Vested Retirement Benefit to begin, but in
                  no event later than his Normal Retirement Date.

(hh)     "SALARIED BENEFIT SERVICE" means the service of a Salaried Participant
         as determined under Section 3.5.

(ii)     "SALARIED EMPLOYEE" or "SALARIED PARTICIPANT" means an Employee or
         Participant, respectively, who is compensated by a salary paid on a
         biweekly basis.

(jj)     "SOCIAL SECURITY RETIREMENT AGE" means the "social security retirement
         age" of a Member, as determined under Code Section 415(b)(8).

(kk)     "SPONSOR" means R. G. BARRY CORPORATION, or any successor thereto.

(ll)     "SPOUSE" means the person to whom a Member is legally married on any
         relevant date or who is treated as if married to the Member pursuant to
         a qualified domestic relations order as defined in Code Section 414(p).

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(mm)     "TRUST AGREEMENT" means any agreement in the nature of a trust, or in
         the nature of a custodial or funding agreement (including any group
         annuity contract and/or funding investment contract issued pursuant
         thereto) between the Sponsor and the Trustee and/or insurer, that is
         established to form a part of the Plan to receive, hold, invest and
         dispose of the Trust Fund.

(nn)     "TRUSTEE" means the Trustee or Trustees named in the Trust Agreement
         and/or the insurer named in any other funding agreement, and any
         additional or successor Trustee or Trustees from time to time acting as
         Trustee or Trustees of the trust assets under the Plan, or the insurer
         acting in the capacity of a custodian or funding agent of such trust
         assets.

(oo)     "TRUST FUND" or "TRUST" means the funds or assets which are held and
         administered by the Trustee pursuant to the Trust Agreement and the
         Plan.

(pp)     "VESTING SERVICE" means the service of an Employee, as determined under
         Section 3.4.

2.2 CONSTRUCTION

Unless the context clearly requires otherwise, (a) the masculine pronoun
whenever used shall include the feminine and neuter pronoun, and the singular
shall include the plural; and (b) headings of Articles and Sections herein are
included solely for convenience and if there is any conflict between such
headings and the text of the Plan, the text shall control.

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ARTICLE III.  PARTICIPATION AND SERVICE

3.1  ACTIVE PARTICIPATION

Each individual who was a Participant in the Plan on December 31, 1996, in
accordance with the terms of such Plan as in effect on said date shall remain a
Participant, subject to the provisions of this Plan. Each other Employee shall
become an Active Participant under the Plan on the January 1 nearest to the
latest to occur of--

(a)      the date he is employed as an Eligible Employee;

(b)      the date on which he is credited with at least one year of Eligibility
         Service (defined below); or

(c)      the date, on or after the Effective Date, that the Plan was made
         applicable to the Employer of the individual;

provided he is employed as an Eligible Employee on such January 1. For the
purpose of determining eligibility to participate, one year of "Eligibility
Service" shall mean the first 12-consecutive-month period, beginning on the
Employee's Employment Commencement Date, during which the Employee completes
1,000 or more Hours of Service. If he does not actually have 1,000 or more Hours
of Service during the 12-month period beginning with his Employment Commencement
Date, but he actually has 1,000 or more Hours of Service during any Plan Year
(beginning with the Plan Year in which such initial 12-month period ends), then
he shall become an active Participant on the first day of the Plan Year
immediately following such Plan Year.

An Employee who satisfies the eligibility requirements of Sections 3.1(a), (b)
and (c) but who is not employed as an Eligible Employee on the applicable entry
date shall become an Active Participant under the Plan upon his reemployment as
an Eligible Employee following such entry date; provided, however, that if he is
not credited with at least one year of Vesting Service at the time of such
reemployment, he shall become an Active Participant in accordance with the
second sentence of this Section 3.1.

3.2 PARTICIPATION STATUS; MEMBERSHIP; REEMPLOYMENT

A Participant shall either be an "Active Participant" or an "Inactive
Participant" under the Plan. An Eligible Employee who has become an Active
Participant, as provided in Section 3.1, shall continue his status as an "Active
Participant" so long as he remains employed as an Eligible Employee. An Employee
who has become an Active Participant under the Plan, as provided in Section 3.1,
shall be an "Inactive Participant" during any period when he is employed as an
Employee but not as an Eligible Employee. Such an Inactive Participant shall
resume the status of an "Active Participant" at the time he resumes employment
as an Eligible Employee. An Active Participant or Inactive Participant who
ceases employment as an Employee shall become a "Former Participant." A Former
Participant shall become an "Inactive Participant" upon his reemployment as an
Employee or shall become an "Active Participant" upon his reemployment

                                       10
<PAGE>

as an Eligible Employee; provided, however, that if such Eligible Employee is
not credited with at least one year of Vesting Service at the time of his
reemployment as an Eligible Employee, he shall become an Active Participant in
accordance with the provisions of Section 3.1. As provided in Section 2.1(v), an
individual shall be classified as a "Member" under the Plan so long as he is an
Active Participant, an Inactive Participant or a Former Participant who is
entitled to receive a Retirement Benefit under the Plan. A Participant who
terminates his employment as an Employee and who is not entitled to receive a
Retirement Benefit under the Plan shall cease to be a Member covered under the
Plan.

3.3 TRANSFERRED EMPLOYEES

(a)      TRANSFER TO NONPARTICIPATING AFFILIATE. Should a Participant cease to
         be an Eligible Employee as defined in Section 2.1(m), but remain an
         Employee of the Sponsor or an Affiliate, the following provisions will
         apply:

         (1)      No Salaried or Nonsalaried Benefit Service shall be credited
                  during such period, and any benefit he may become entitled to
                  under the Plan shall be determined using the benefit formula
                  under the Plan in effect at the time of transfer and his Final
                  Average Compensation, Primary Social Security Benefit,
                  Compensation and Salaried and/or Nonsalaried Benefit Service,
                  whichever are applicable, while he was an Active Participant
                  in the Plan.

         (2)      A Participant shall continue to accrue Vesting Service during
                  such period.

         (3)      If such person again becomes an Eligible Employee, he shall
                  become an Active Participant in the Plan the first of the
                  calendar month coinciding with or next following his
                  reclassification.

         (4)      Should the status of an Affiliate change so that it is
                  disassociated with the Sponsor, the Participant will then be
                  considered to have terminated his or her employment and shall
                  be entitled to receive his Retirement Benefit as provided in
                  Article IV of the Plan.

(b)      TRANSFER TO ANOTHER PARTICIPATING EMPLOYER. It is anticipated that an
         Employee may be transferred between participating Employers; and in the
         event of any such transfer, the Employee involved shall carry with him
         his accumulated Salaried and/or Nonsalaried Benefit Service and Vesting
         Service. No such transfer shall effect a termination of employment
         hereunder, and the Employer to which the Employee is transferred shall
         thereupon become obligated hereunder with respect to such Employee in
         the same manner as was the Employer from whom the Employee was
         transferred. For the Plan Year of the transfer, both Employers shall
         pay their proportionate share of the cost, if any, of the Plan with
         respect to the transferring Employee for that Plan Year. Appropriate
         adjustments shall be made between participating Employers to reflect
         the transfers of employment.

                                       11
<PAGE>

(c)      MULTIPLE BENEFITS. The benefits under this Plan for the period during
         which an individual is a Nonsalaried Employee and a Salaried Employee
         shall be determined independently; provided, however, that no more than
         30 years of combined Salaried and Nonsalaried Benefit Service shall be
         considered in determining total benefits under the Plan. Salaried and
         Nonsalaried Benefit Service are each limited to 30 years.
         Notwithstanding any Plan provisions to the contrary, if the sum of a
         Participant's years of Salaried and Nonsalaried Benefit Service exceeds
         30, then the benefit with the more generous accrual (generally, the
         benefit earned as a Salaried Participant) shall be offset by a fraction
         of the amount of the other benefit. The numerator of said fraction
         shall equal the difference between (1) total years of Salaried and
         Nonsalaried Benefit Service and (2) 30, and the denominator shall be
         the years of Salaried or Nonsalaried Benefit Service, whichever
         provides the less generous benefit. The benefit with the less generous
         accrual (generally, the benefit earned as a Nonsalaried Participant)
         shall be provided without adjustment.

3.4 VESTING SERVICE

A Member's eligibility for benefits under the Plan shall be determined by his
period of Vesting Service. Vesting Service means a Member's period or periods of
employment by the Employers and Affiliates determined in accordance with
reasonable and uniform standards and policies adopted by the Committee from time
to time, which standards and policies shall be consistently observed. A Member
will be credited with years of Vesting Service in accordance with the following
provisions:

(a)      Vesting Service prior to January 1, 1996: For a Member as of the
         Effective Date who had been covered under the prior provisions of the
         Plan, the Member's period of employment with the Employer prior to
         January 1, 1996 shall be counted as Vesting Service in accordance with
         Section 3.6.

(b)      Vesting Service from and after January 1, 1996: Subject to the Break in
         Service provisions, a year of Vesting Service means any Plan Year
         during which the Member has at least 1,000 Hours of Service. A Member
         shall be credited with Vesting Service in whole and fractional years of
         such Member's period(s) of employment (whether or not such period(s) of
         employment were consecutive) which are not disregarded as a result of
         the application of the break rules of Section 3.4(d). Nonsuccessive
         periods of employment must be aggregated, and less than whole year
         periods of employment (whether or not consecutive) shall be aggregated
         on the basis that each fractional year of Vesting Service is rounded to
         the nearest one-hundredth. Hours of Service for this purpose shall also
         include periods of vacation, regular holidays, illness, incapacity,
         layoff, jury duty, military duty or Leave of Absence. An Employee shall
         receive credit for Vesting Service from his Employment Commencement
         Date until his Break in Service. No more than one year of Vesting
         Service shall be credited to a Member under this Plan in any Plan Year.

                                       12
<PAGE>

(c)      Vesting Service shall not be deemed to have been broken--

         (1)      by any transfer of employment of an Employee between
                  Affiliates regardless of whether the Affiliate is an Employer
                  hereunder; or

         (2)      during such period as an Employee is receiving credit for
                  Hours of Service under Section 3.7.

(d)      If an Employee who has had a Break in Service is subsequently
         reemployed as an Employee--

         (1)      if he is reemployed before a One-Year Break in Service occurs
                  after such Break in Service, the Vesting Service he had at
                  such Break in Service shall be reinstated from such Employee's
                  most recent Employment Commencement Date after the Employee
                  completes a year of Vesting Service following the Break in
                  Service.

         (2)      if he is reemployed after a One-Year Break in Service occurs
                  after such Break in Service, he shall be considered a new
                  Employee for purposes of the Plan, except--

                  (A)      if at such Break in Service he had a vested interest
                           in any portion of his accrued benefit, Vesting
                           Service he had at such Break in Service shall be
                           reinstated from such Employee's most recent
                           Employment Commencement Date after the Employee
                           completes a year of Vesting Service following the
                           One-Year Break in Service.

                  (B)      if Section 3.4(d)(2)(A) as provided above is not
                           applicable, and if the number of consecutive One-Year
                           Breaks in Service does not equal or exceed the
                           greater of five or the number of years of Vesting
                           Service he had before such Break in Service, the
                           years of Vesting Service he had at such Break in
                           Service shall be reinstated from such Employee's most
                           recent Employment Commencement Date after the
                           Employee completes a year of Vesting Service
                           following the One-Year Break in Service.

(e)      In determining an Employee's Vesting Service pursuant to this Section
         3.4, the following terms shall apply:

         (1)      "BREAK IN SERVICE" shall mean the earlier of (A) or (B) below:

                  (A)      the date the Employee quits, retires, is discharged
                           or dies; or

                  (B)      the first anniversary of the first day of an
                           Employee's absence from employment as an Employee
                           (with or without pay) for any reason other than in
                           (A) above, such as vacation, sickness, Leave of
                           Absence, layoff or military service, or special leave
                           of absence as provided in Section 3.10. An Employee
                           who fails to return to employment as an Employee at
                           the

                                       13
<PAGE>

                           expiration of such absence shall be deemed to have
                           had a Break in Service on the first to occur of the
                           expiration of his absence or the first anniversary of
                           the first day of his absence.

         (2)      A "ONE-YEAR BREAK IN SERVICE" shall mean each Plan Year
                  beginning with the Plan Year which includes the date an
                  Employee incurs a Break in Service, provided that the Employee
                  is credited with 500 or fewer Hours of Service during such
                  period. Solely for purposes of determining whether a One-Year
                  Break in Service has occurred, in the case of an Employee who
                  is absent from work beyond the first anniversary of the first
                  date of an absence and the absence is for one of the following
                  reasons, the date the Employee incurs a Break in Service shall
                  be the second anniversary of the Employee's absence from
                  employment:

                  (A)      the pregnancy of the Employee;

                  (B)      the birth of a child of the Employee;

                  (C)      the adoption of a child by the Employee; or

                  (D)      caring for such child for a period immediately
                           following birth or adoption.

                  The period between the first and second anniversaries of the
                  first date of absence shall not constitute Vesting Service.

3.5 BENEFIT SERVICE

The amount of the benefit payable to or on behalf of a Member shall be
determined on the basis of his Salaried and/or Nonsalaried Benefit Service, in
accordance with the following:

(a)      SALARIED AND/OR NONSALARIED BENEFIT SERVICE PRIOR TO JANUARY 1, 1996.
         For a Member as of January 1, 1996, who had been covered under the
         prior provisions of either of the Prior Plans, the amount of Salaried
         and/or Nonsalaried Benefit Service to be credited for employment prior
         to January 1, 1996 shall be determined in accordance with Section 3.6.

(b)      SALARIED BENEFIT SERVICE FROM AND AFTER JANUARY 1, 1996. The Member's
         Salaried Benefit Service shall be equal to his Vesting Service reduced
         by--

         (1)      any period of Vesting Service prior to the date on which the
                  Member first became a Salaried Participant under the Plan (or
                  the R. G. Barry Corporation Salaried Employees' Pension Plan
                  as in effect prior to January 1, 1996) during which the Member
                  was not a Salaried Employee of the Employer;

         (2)      any period of Vesting Service from and after the date on which
                  the Member first became a Salaried Participant under the Plan
                  (or the R. G. Barry Corporation Salaried Employees' Pension
                  Plan as in effect prior to January 1, 1996) during which the
                  Member was not a Salaried Employee of the Employer, including,
                  but

                                       14
<PAGE>

                  not limited to, any period between a Break in Service, as
                  defined in Section 3.4(e)(1), and reemployment as an Eligible
                  Employee and any period during which he was an Inactive
                  Participant; and

         (3)      any period of Vesting Service reinstated pursuant to the
                  provisions of Section 3.4(d) if the Member was entitled, upon
                  such termination, to a monthly Retirement Benefit under the
                  Plan, and the full Actuarial Equivalent value of such
                  Retirement Benefit had been paid on behalf of such Member
                  under the provisions of Section 4.9(c)(3) or 5.1(a)(6).

(c)      NONSALARIED BENEFIT SERVICE FROM AND AFTER JANUARY 1, 1996. The
         Member's Nonsalaried Benefit Service shall be equal to his Vesting
         Service reduced by--

         (1)      any period of Vesting Service prior to the date on which the
                  Member first became a Nonsalaried Participant under the Plan
                  (or the Retirement Income Plan for Non-Salaried Employees of
                  R. G. Barry Corporation as in effect prior to January 1, 1996)
                  during which the Member was not a Nonsalaried Employee of the
                  Employer;

         (2)      any period of Vesting Service from and after the date on which
                  the Member first became a Nonsalaried Participant under the
                  Plan (or the Retirement Income Plan for Non-Salaried Employees
                  of R. G. Barry Corporation as in effect prior to January 1,
                  1996) during which the Member was not a Nonsalaried Employee
                  of the Employer, including, but not limited to, any period
                  between a Break in Service, as defined in Section 3.4(e)(1),
                  and reemployment as an Eligible Employee and any period during
                  which he was an Inactive Participant; and

         (3)      any period of Vesting Service reinstated pursuant to the
                  provisions of Section 3.4(d) if the Member was entitled, upon
                  such termination, to a monthly Retirement Benefit under the
                  Plan, and the full Actuarial Equivalent value of such
                  Retirement Benefit had been paid on behalf of such Member
                  under the provisions of Section 4.9(c)(3) or 5.1(a)(6).

No more than one year of Salaried or Nonsalaried Benefit Service shall be
credited to a Member under this Plan in any Plan Year.

3.6 PRIOR SERVICE

For periods prior to January 1, 1996, an Employee's service shall consist of his
years and fractions of a year of Vesting Service, Salaried Benefit Service under
the R. G. Barry Corporation Salaried Employees' Pension Plan and Nonsalaried
Benefit Service under the Retirement Income Plan for Non-Salaried Employees of
R. G. Barry Corporation as reflected in the Employer's records for such Prior
Plans. Such service shall be subject to the effect of any Break in Service
incurred under provisions of the Prior Plans in effect prior to January 1, 1996,
and shall be determined in accordance with the prior provisions of the Prior
Plans including rules which relate to required minimum hours or other length of
service.

                                       15
<PAGE>

3.7 HOURS OF SERVICE

Hours of Service shall be determined by including the following:

(a)      each Hour of Service for which the Employer or Affiliate, either
         directly or indirectly, pays an Employee, or for which the Employee is
         entitled to payment, for the performance of duties. The Committee
         credits Hours of Service under this paragraph (a) to the Employee for
         the computation period in which the Employee performs the duties,
         irrespective of when paid;

(b)      each Hour of Service for back pay, irrespective of mitigation of
         damages, to which the Employer or Affiliate has agreed or for which the
         Employee has received an award. The Committee credits Hours of Service
         under this paragraph (b) to the Employee for the computation period(s)
         to which the award or the agreement pertains rather than for the
         computation period in which the award, agreement or payment is made;

(c)      each Hour of Service for which the Employer or Affiliate, either
         directly or indirectly, pays an Employee, or for which the Employee is
         entitled to payment (irrespective of whether the employment
         relationship is terminated), for reasons other than for the performance
         of duties during a computation period, such as Leave of Absence,
         vacation, holiday, sick leave, illness, incapacity, layoff, jury duty
         or military duty. The Committee will credit no more than 501 Hours of
         Service under this paragraph (c) to an Employee on account of any
         single continuous period during which the Employee does not perform any
         duties (whether or not such period occurs during a single Plan Year).
         The Committee credits Hours of Service under this paragraph (c) in
         accordance with the rules of paragraphs (b) and (c) of Labor Reg.
         Section 2530.200b-2, which the Plan, by this reference, specifically
         incorporates in full within this paragraph (c). The Committee will not
         credit an Hour of Service under more than one of the above paragraphs.
         A computation period for purposes of this Section 3.7 is the calendar
         year. The Committee will resolve any ambiguity with respect to the
         crediting of an Hour of Service in favor of the Employee; and

(d)      each Employee shall be credited with Hours of Service on the basis of
         an assumed 45 Hours of Service per week for each week for which the
         Employee would have received at least one Hour of Service in accordance
         with this definition to the extent it does not result in crediting
         Hours of Service more than once with respect to any period.

3.8 SPECIAL PROVISIONS RELATING TO ACQUIRED BUSINESSES

In any case in which an individual becomes an Employee upon the acquisition of
all or a portion of the business of his former employer by an Employer or an
Affiliate, whether by merger, acquisition of assets or stock, or otherwise, his
service and compensation with such acquired employer prior to the date on which
such employer became an Affiliate (or part of an Affiliate) shall not be taken
into account under the Plan for purposes of calculating his Vesting Service,

                                       16
<PAGE>

Salaried or Nonsalaried Benefit Service, and Compensation under the Plan, except
to the extent that such service is required to be recognized under Code Section
414(a).

3.9 LEASED EMPLOYEES

A person who is not classified by the Employer or an Affiliate as an Employee
and who performs services for an Employer or an Affiliate pursuant to an
agreement between the Employer or Affiliate and a leasing organization shall be
considered a "leased employee" if such person performed the services on a
substantially full-time basis for at least one year and the services are under
the primary direction and control of the Employer or Affiliate. A person who is
considered a "leased employee" of an Employer shall not be considered an
Employee for purposes of the Plan. If such a person becomes a Participant under
the Plan as a result of being classified by the Employer as an Employee, he
shall receive credit for his service as a leased employee in calculating his
Vesting Service under the Plan but not for calculating his Salaried or
Nonsalaried Benefit Service.

3.10 SPECIAL PROVISIONS FOR PARTICIPANTS WHO ENTER THE ARMED FORCES

Notwithstanding any provision in this Plan to the contrary, effective on and
after December 12, 1994, contributions, benefits and service credit with respect
to qualified military service will be provided in accordance with Code Section
414(u). If a Participant is absent from employment for voluntary or involuntary
qualified military service with the armed forces of the United States, does not
receive a dishonorable discharge and returns to employment as an Employee within
the period required under the law pertaining to veterans' reemployment rights,
he shall receive Vesting Service and Salaried or Nonsalaried Benefit Service
(based on his employment status when the absence began) for the period of his
absence from employment.

3.11 SPECIAL PROVISIONS FOR CLASS A COMMISSIONED SALES REPRESENTATIVES

If a Class A commissioned sales representative of the Employer becomes a
Participant under the Plan as a result of subsequent employment as an Eligible
Employee with an Employer, he shall receive credit for his service as a Class A
commissioned sales representative in calculating his Vesting Service under the
Plan, but such service shall be considered Salaried Benefit Service only with
respect to Plan Years beginning on or after January 1, 1991; provided, however,
that despite the provisions of Section 2.1(j), commissions earned while a person
is a Class A commissioned sales representative of the Employer shall not be
considered to be Compensation for purposes of this Plan.

                                       17
<PAGE>

ARTICLE IV.  BENEFITS

4.1      NORMAL RETIREMENT BENEFITS

(a)      ELIGIBILITY. A Participant who attains his Normal Retirement Age while
         employed as an Employee and retires on or before his Normal Retirement
         Date shall be eligible to receive a Normal Retirement Benefit
         commencing on his Normal Retirement Date. Upon attaining his Normal
         Retirement Age, such Participant shall have a nonforfeitable right to
         his Normal Retirement Benefit.

(b)      AMOUNT FOR SALARIED PARTICIPANT. A Salaried Participant who terminates
         his employment as an Employee and who is eligible for a Normal
         Retirement Benefit under Section 4.1(a) shall be entitled to a Normal
         Retirement Benefit commencing on his Normal Retirement Date. Such
         Normal Retirement Benefit shall be calculated based on his years of
         Salaried Benefit Service, Final Average Compensation and his Primary
         Social Security Benefit as a Salaried Employee as of his Normal
         Retirement Date. The monthly amount of a Salaried Participant's Normal
         Retirement Benefit payable for the lifetime of the Participant shall be
         equal to 48 percent of the Salaried Participant's Final Average
         Compensation reduced by 50 percent of his Primary Social Security
         Benefit if the Salaried Participant has accrued at least 30 years of
         Salaried Benefit Service. If the Salaried Participant has less than 30
         years of Salaried Benefit Service at his Normal Retirement Date, then
         the resulting amount shall be multiplied by a fraction, the denominator
         of which is 30 and the numerator of which is the Salaried Participant's
         years, including partial years, of Salaried Benefit Service.

         Notwithstanding any Plan provision to the contrary, a Retirement
         Benefit shall not be reduced below the value of the benefit determined
         as of December 31, 1993 (or, if greater, December 31, 1988) due to the
         effects of any changes in the limits of recognizable Compensation under
         Code Section 401(a)(17).

(c)      AMOUNT FOR NONSALARIED PARTICIPANT. A Nonsalaried Participant who
         terminates his employment as an Employee and who is eligible for a
         Normal Retirement Benefit under Section 4.1(a) shall be entitled to a
         Normal Retirement Benefit commencing on his Normal Retirement Date.
         Such Normal Retirement Benefit shall be a monthly amount payable during
         the life of the Member, determined by multiplying (1) the Participant's
         years, including fractional years, of Nonsalaried Benefit Service (up
         to a maximum of 30 years) by (2) the benefit factor in effect on the
         date of his termination of employment as an Eligible Employee
         (regardless of when he ceased to be a Nonsalaried Employee) in
         accordance with the following table:

                                       18
<PAGE>

         TERMINATION DATE
         -----------------------------------------------------------------------

         On or After               But Before           Amount
         -----------------------------------------------------------------------

         1/1/64                    1/1/87               $ 5.00
         1/1/87                    1/1/89               $ 7.00
         1/1/89                    1/1/90               $ 8.00
         1/1/90                    6/30/91              $ 9.00
         7/1/91                    1/1/96               $10.00
         1/1/96                      --                 $11.00

         -----------------------------------------------------------------------

         Notwithstanding the provisions of the previous paragraph, certain
         Members whose employment as Nonsalaried Employees with the Employer was
         terminated prior to July 1, 1991 shall nevertheless be eligible to
         receive a Normal Retirement Benefit determined by multiplying their
         respective years of Nonsalaried Benefit Service, up to a maximum of 30
         years, by $10. These individuals shall include Members (a) employed in
         the Goldsboro, North Carolina, sewing plant on the final day of such
         facility's operation; (b) employed in cutting and laminating operations
         at the San Angelo, Texas, facility on the final day of those
         operations; and (c) employed in Columbus, Ohio, whose employment with
         the Employer was terminated by layoff on December 3, 1990 and who had
         at least 15 years of Nonsalaried Benefit Service at the time of layoff.

(d)      NONDUPLICATION OF BENEFITS. There shall be no duplication of benefits.
         The Normal Retirement Benefits under Section 4.1(b) and (c) shall in no
         event be less than the largest respective Early Retirement Benefit
         which the Participant would have been entitled to receive under Section
         4.3 by retiring at any time after meeting early retirement eligibility
         requirements for an Early Retirement Benefit.

4.2      LATE RETIREMENT BENEFITS

(a)      ELIGIBILITY. A Participant who attains his Normal Retirement Age while
         employed as an Employee shall be eligible to receive a Late Retirement
         Benefit under the Plan, commencing on his Late Retirement Date.

(b)      AMOUNT. A Participant who terminates his employment as an Employee and
         who is eligible for a Late Retirement Benefit under Section 4.2(a)
         shall be entitled to a monthly Late Retirement Benefit commencing on
         his Late Retirement Date. Such Late Retirement Benefit shall be
         computed in the same manner as a Normal Retirement Benefit under
         Section 4.1(b) and/or (c), whichever applies, except that it shall be
         based on his years of Salaried or Nonsalaried Benefit Service, his
         Final Average Compensation, his Primary Social Security Benefit and the
         applicable provisions of the Plan as in effect at his Late Retirement
         Date.

         The benefits of a Participant shall not be determined based on a
         formula which became effective after his separation from service. If a
         Member continues in employment beyond

                                       19
<PAGE>

         his Normal Retirement Age at a rate such that his Normal Retirement
         Benefits are suspended pursuant to Section 5.1(a), his benefit upon
         retirement shall be calculated using the Plan formula in effect when he
         actually terminates employment. If a Member continues in employment
         beyond his Normal Retirement Age at a rate such that his Normal
         Retirement Benefits are payable during such employment pursuant to
         Section 5.1(a), his benefit shall be calculated using the Plan formula
         in effect when his benefit payments begin.

4.3      EARLY RETIREMENT BENEFITS

(a)      ELIGIBILITY. A Participant who attains his Early Retirement Age while
         employed as an Employee shall be eligible to receive an Early
         Retirement Benefit under the Plan, commencing on his Early Retirement
         Date.

(b)      AMOUNT. A Participant who terminates his employment as an Employee and
         who is eligible for an Early Retirement Benefit under Section 4.3(a)
         shall be entitled to a monthly Early Retirement Benefit under the Plan.
         Application for commencement prior to his Normal Retirement Date must
         be made in writing to the Committee not more than 90 days prior to the
         date he elects to have distributions commence. Such Early Retirement
         Benefit shall be computed in the same manner as a Normal Retirement
         Benefit under Section 4.1(b) and/or (c), except that it shall be based
         on his years of Salaried or Nonsalaried Benefit Service, his Final
         Average Compensation, his Primary Social Security Benefit and the
         applicable provisions of the Plan as in effect at his termination of
         employment as an Eligible Employee. The benefits of a Participant shall
         not be determined based on a formula which became effective after his
         separation from service as an Eligible Employee. If the Retirement
         Benefit thus determined commences prior to the Member's Normal
         Retirement Age, it shall be reduced as of the date the first Early
         Retirement Benefit payment commences by 5/9 of one percent for each of
         the first 60 months and 5/18 of one percent for each of the next 60
         months, as applicable, by which his Early Retirement Benefit payment
         precedes his Normal Retirement Age.

         The Early Retirement Benefit under this Section 4.3(b) will in no event
         be less than the largest Early Retirement Benefit that the Member would
         have been entitled to receive under this Section 4.3 by retiring at any
         time after meeting Early Retirement eligibility requirements.

4.4      DISABILITY RETIREMENT BENEFITS

(a)      ELIGIBILITY. A Participant who is actively employed as an Employee, who
         has completed at least 15 years of Vesting Service, who has attained at
         least age 50 but not his Normal Retirement Age, who incurs a
         Disability, as defined below, while so employed, and who terminates his
         employment as an Employee as a result of such Disability shall be
         eligible to receive a Disability Retirement Benefit under the Plan,
         commencing on his Normal Retirement Date with respect to benefits
         earned as a Salaried Employee and commencing on his Disability
         Retirement Date with respect to benefits earned as a Nonsalaried
         Employee. For purposes of this Section 4.4, "Disability" means that the
         Employee is so

                                       20
<PAGE>

         totally and permanently incapacitated as established by a licensed
         physician selected by the Committee that he is not able to perform his
         job or any job for the Employer for which he is reasonably suited as a
         result of his education, training and experience and that the Employee
         qualifies for Social Security disability benefits. A Member who
         commences Disability Retirement Benefit payments under the Plan shall
         not be eligible to receive any other Retirement Benefit under the Plan
         while he is receiving Disability Retirement Benefit payments.
         Disability Retirement Benefits payable to Nonsalaried Employees prior
         to Normal Retirement Age shall terminate with the last payment made
         prior to the date on which the earliest of the following events occurs:

         (1)      the Member engages in any regular gainful employment or
                  occupation for remuneration or profit;

         (2)      the Committee determines on the basis of a medical examination
                  that the Member is no longer permanently or totally disabled;

         (3)      the Member refuses to undergo a medical examination ordered by
                  the Committee not more frequently than semi-annually; or

         (4)      the date of the Member's death.

(b)      AMOUNT FOR A SALARIED PARTICIPANT. A Member who has terminated
         employment as an Employee and who is eligible for a Disability
         Retirement Benefit under Section 4.4(a) shall be entitled to a monthly
         Disability Retirement Benefit commencing on his Normal Retirement Date.
         Such Disability Retirement Benefit shall be an amount equal to the
         product of: (1) the Normal Retirement Benefit as described in Section
         4.1(b) to which the Member would have been entitled on his Normal
         Retirement Date if his employment as a Salaried Employee had continued
         without change until he attained Normal Retirement Age, and using his
         Final Average Compensation, his Primary Social Security Benefit and the
         provisions of the Plan in effect at his termination of employment as a
         Salaried Employee due to Disability in lieu of the corresponding
         amounts determined as of this Normal Retirement Date multiplied by (2)
         a fraction, the numerator of which is the Member's Salaried Benefit
         Service as of such termination date, and the denominator of which is
         the Salaried Benefit Service that would accrue as of his Normal
         Retirement Date.

(c)      AMOUNT FOR NONSALARIED PARTICIPANT. A Member who has terminated
         employment as an Employee and who is eligible for a Disability
         Retirement Benefit under Section 4.4(a) shall be entitled to a monthly
         Disability Retirement Benefit commencing on his Disability Retirement
         Date. Such Disability Retirement Benefit shall be computed in the same
         manner as a Normal Retirement Benefit under Section 4.1(c), except that
         it shall be based on his years of Nonsalaried Benefit Service and the
         provisions of the Plan as in effect at his Disability Retirement Date
         and that it shall be reduced by workers' compensation benefits (except
         awards or fixed statutory payments for loss or loss of use of any
         bodily member) payable to him with respect to his Disability. In the
         case of lump sum settlements under workers' compensation, the lump sum
         shall be divided by the weekly

                                       21
<PAGE>

         workers' compensation benefit which would otherwise have been payable
         to determine the period over which the reduction should be made and the
         amount of the reduction. Benefits shall not be payable to a Member
         under more than one provision hereof for the same period of time.

4.5      VESTED RETIREMENT BENEFITS

(a)      ELIGIBILITY. A Member who attains his Vested Retirement Age shall be
         eligible to receive a Vested Retirement Benefit under the Plan,
         commencing on his Vested Retirement Date. If the terminated Member dies
         before the date he would have been eligible to receive a Vested
         Retirement Benefit, no benefit shall be paid to or for him except under
         the terms of Sections 4.6, 4.7 and 4.8.

(b)      AMOUNT. A Member who has terminated his employment as an Employee, who
         is eligible for a Vested Retirement Benefit under Section 4.5(a) and
         who is not eligible for another Retirement Benefit under the Plan at
         the time of such termination of employment shall be entitled to a
         monthly Vested Retirement Benefit commencing on his Vested Retirement
         Date. Application for commencement prior to his Normal Retirement Date
         must be made in writing to the Committee not more than 90 days prior to
         the date he elects to have distributions commence. For a Salaried
         Participant, such Vested Retirement Benefit shall be an amount equal to
         the product of: (1) the Normal Retirement Benefit as described in
         Section 4.1(b) to which the Member would have been entitled on his
         Normal Retirement Date if his employment as a Salaried Employee had
         continued without change until he attained Normal Retirement Age, and
         using his Final Average Compensation, his Primary Social Security
         Benefit and the provisions of the Plan in effect at his termination of
         employment as an Eligible Employee in lieu of the corresponding amounts
         determined as of this Normal Retirement Date multiplied by (2) a
         fraction, the numerator of which is the Member's Salaried Benefit
         Service as of such termination date, and the denominator of which is
         the Salaried Benefit Service that he would accrue as of his Normal
         Retirement Date. For a Nonsalaried Participant, such Vested Retirement
         Benefit shall be computed in the same manner as a Normal Retirement
         Benefit under Section 4.1(c), except that it shall be based on his
         years of Nonsalaried Benefit Service and the provisions of the Plan as
         in effect on the date he ceases to be a Nonsalaried Employee. If the
         Vested Retirement Benefit thus determined commences prior to the
         Member's Normal Retirement Age, it shall be reduced as of the date the
         first Vested Retirement Benefit payment commences by 5/9 of one percent
         for each of the first 60 months and 5/18 of one percent for each of the
         next 60 months, as applicable, by which his Vested Retirement Benefit
         payment precedes his Normal Retirement Age.

(c)      IMMEDIATE DISTRIBUTION OPTION. Notwithstanding any provisions of the
         Plan to the contrary, effective as of January 1, 1997, if the Member is
         not eligible for an immediate distribution under Section 4.5(b) above
         on the date of his termination of employment as an Employee and elects
         to have his distribution commence as soon as practicable following his
         termination of employment as an Employee in accordance with Section
         5.1(a)(4), then his Vested Retirement Benefit shall be equal to an
         immediate reduced

                                       22
<PAGE>

         Vested Retirement Benefit commencing as soon as administratively
         practicable following his termination of employment as an Employee
         computed as provided in Section 4.5(b) payable at Normal Retirement Age
         and adjusted as provided below. Notwithstanding any provisions of the
         Plan to the contrary, an immediate distribution option shall not be
         available if the lump sum value of the total benefits earned as a
         Salaried Employee and as a Nonsalaried Employee as determined below
         exceeds $7,500.

         Notwithstanding any provisions of the Plan to the contrary, the
         immediate reduced Vested Retirement Benefit described in this Section
         4.5(c) shall be payable only in the following forms:

         (1)      subject to the consent requirements referenced in Section
                  4.8(a) or (b), a lump sum distribution equal to the Actuarial
                  Equivalent of the amount determined in Section 4.5(b) payable
                  at Normal Retirement Age. Any Member who receives such a
                  distribution shall have no further interest in the Plan; or

         (2)      an immediate annuity payable in the Member's normal form of
                  benefit payment as described in Section 4.8(a) or (b),
                  whichever is applicable. Such immediate annuity shall be the
                  Actuarial Equivalent of the lump sum distribution as
                  calculated above in Section 4.5(c)(1).

         The other optional forms of benefit described in Section 4.8(c) shall
         not be available for any distribution made under this Section 4.5(c).

         The Committee shall notify each Member who is eligible to elect to
         receive a distribution under this Section 4.5(c). An application for
         commencement must be made within the election period determined in
         accordance with the administrative procedures established by the
         Committee. The distribution shall commence as soon as administratively
         practicable following the receipt of the Member's completed consent
         form. If the Member does not file a timely consent to a current
         distribution in accordance with this Section 4.5(c), then distribution
         of his Retirement Benefit shall not commence prior to the date
         otherwise provided in this Plan or the Prior Plans, whichever is
         applicable.

         Should a Member who receives a benefit under this Section 4.5 be
         reemployed by an Employer, any Retirement Benefits payable after his
         reemployment shall be reduced by the Actuarial Equivalent of the
         benefit he previously received under this Section 4.5.

(d)      FORFEITURES. To the extent that the present lump sum value of a
         Member's vested accrued benefit derived from Employer contributions is
         zero at the time he ceases to be an Employee, the Member shall be
         deemed to have received a distribution of such vested accrued benefit,
         and such Member's Salaried and Nonsalaried Benefit Service shall be
         disregarded for purposes of accrual of benefits under the Plan unless
         such Member resumes covered employment with the Employer before the
         Member accrued a period of five (5) or more consecutive One-Year Breaks
         in Service [as defined in Section 3.4(e)(2)], in which event the
         Member's accrued benefit derived from Employer

                                       23
<PAGE>

         contributions shall be restored to the amount of such accrued benefit
         on the date of the deemed distribution.

4.6      DEATH BENEFIT

Except as provided under Section 4.7, 4.8 or 4.9, no benefit shall be payable to
any person after the death of a Member. Sections 4.7 and 4.8 will not apply with
respect to Participants who terminated employment prior to September 2, 1974.

4.7      PRERETIREMENT SURVIVING SPOUSE'S BENEFIT

(a)      ELIGIBILITY. In the case of a Member who (1) is eligible for a Vested
         Retirement Benefit; (2) has a surviving Spouse; and (3) dies prior to
         his Annuity Starting Date for his Retirement Benefit (whether or not
         such Member is employed as an Employee), there shall be payable to his
         surviving Spouse a Preretirement Surviving Spouse's Benefit as
         described in Section 4.7(b) and (c).

(b)      AMOUNT. The deceased Member's surviving Spouse who is eligible to
         receive a Preretirement Surviving Spouse's Benefit shall receive a
         monthly benefit payable for the life of such Spouse equal to--

         (1)      if the Member died on or before the earliest date upon which
                  he could have received Retirement Benefit payments under the
                  Plan ("Earliest Commencement Date"), 50 percent of the monthly
                  Retirement Benefit amount the Member would have received had
                  he terminated employment as an Employee on the date of his
                  death (if he had not already terminated such employment),
                  survived to his Earliest Commencement Date, elected to begin
                  receiving Retirement Benefit payments on his Earliest
                  Commencement Date with the automatic form of payment under
                  Section 4.8 in effect and died on the day after his Earliest
                  Commencement Date; or

         (2)      if the Member died after his Earliest Commencement Date, 50
                  percent of the monthly Retirement Benefit amount the Member
                  would have received had he retired on the day before his
                  death, with his Retirement Benefit payable in the automatic
                  form of payment under Section 4.8 on the date preceding the
                  day on which he died.

(c)      COMMENCEMENT. Payment of the Preretirement Surviving Spouse's Benefit
         to a Member's surviving Spouse shall, unless otherwise elected by such
         Spouse, commence on the later of the Member's Earliest Commencement
         Date or the first day of the month following the Member's death. In no
         event shall the payment of such Benefit commence later than the later
         of the date the Member would have attained his Normal Retirement Date
         or the first day of the month following the Member's death.

                                       24
<PAGE>

4.8      AUTOMATIC JOINT AND SURVIVING SPOUSE ANNUITY

(a)      ELIGIBILITY AND CONDITIONS. In lieu of the monthly Retirement Benefit
         otherwise payable under Section 4.1, 4.2, 4.3, 4.4 or 4.5, a married
         Member who has terminated employment as an Employee and who is eligible
         for a Retirement Benefit payable under said sections shall be deemed to
         have automatically elected a reduced amount of such monthly Retirement
         Benefit payable to him for his life with the provision that if his
         surviving Spouse shall be living on his Annuity Starting Date and also
         at his death after such automatic election shall have become effective,
         a surviving Spouse benefit [as described in Section 4.8(b)(2)] shall be
         payable to his surviving Spouse. Such automatic election is subject to
         the following conditions:

         (1)      The automatic election provided in this Section 4.8 shall
                  become effective as of his Annuity Starting Date for the
                  payment of the Member's reduced monthly Retirement Benefit
                  under the automatic election in the form of an immediate
                  annuity.

         (2)      A Member may prevent the automatic election provided in this
                  Section 4.8 from becoming effective only by executing a
                  specific written rejection of such election on a form approved
                  by the Committee and filing it with the Committee. This
                  written rejection of the automatic election shall not be
                  effective unless (A) the Spouse of the Member consents in
                  writing to such rejection; (B) such rejection designates a
                  form of benefit payment which may not be changed without
                  written spousal consent (or the consent of the Spouse
                  expressly permits designations by the Member without any
                  requirement of further consent by the Spouse); and (C) the
                  Spouse's consent acknowledges the financial consequences of
                  such consent and designation and is witnessed by a Plan
                  representative or a notary public. Such spousal consent shall
                  not be required if the Member establishes to the satisfaction
                  of the Committee that such consent may not be obtained because
                  there is no Spouse, because the Spouse cannot be located or
                  because of such other circumstances as the Secretary of the
                  Treasury may prescribe by regulation. Such rejection must be
                  filed during the "election period" described in Section
                  4.8(a)(3). If the Member has filed a specific written
                  rejection of such automatic election, he may revoke such
                  rejection at any time during the "election period" described
                  in Section 4.8(a)(3) by executing a specific revocation
                  thereof on a form approved by the Committee and filing it with
                  the Committee. Further, a subsequent specific written
                  rejection of the automatic election may then be made in
                  accordance with the preceding provisions of this Section
                  4.8(a)(2).

         (3)      For purposes of this Section 4.8(a), the Member's "election
                  period" shall be the 90-day period ending on his Annuity
                  Starting Date. The Committee shall provide (or cause to be
                  provided) to each Member a written explanation regarding the
                  election and rejection of the Automatic Joint and Surviving
                  Spouse Annuity. Such written explanation shall include the
                  information as required by Code Section 417 relating to
                  qualified joint and survivor annuities and, except as provided
                  in the following sentence, shall be provided no less than 30
                  days and no

                                       25
<PAGE>

                  more than 90 days prior to the Annuity Starting Date or at
                  such times as required by such regulations as currently in
                  effect. The Annuity Starting Date for a distribution in a form
                  other than an Automatic Joint and Surviving Spouse Annuity may
                  be less than 30 days (but not less than 8 days) after the
                  receipt of the written explanation described above, PROVIDED
                  THAT: (A) the Member has been provided with information that
                  clearly indicates that the Member has been given at least 30
                  days to consider whether to waive the Automatic Joint and
                  Surviving Spouse Annuity; (B) the Member is permitted to
                  revoke any affirmative distribution election not later than
                  the later of the Annuity Starting Date or the eighth day after
                  the day the explanation is provided to the Member; and (C) the
                  Annuity Starting Date is a date after the date that the
                  written explanation was provided to the Member.

         (4)      For purposes of this Section 4.8, a Member shall be considered
                  to be a "married Member" if he has a Spouse on the Member's
                  Annuity Starting Date. If the Spouse becomes divorced from the
                  Member after his benefits commence, the Automatic Joint and
                  Surviving Spouse Annuity shall still be payable to the
                  divorced former Spouse, except as otherwise provided in the
                  divorce decree.

(b)      AMOUNT OF BENEFITS.

         (1)      For a Member who is deemed to have made the automatic election
                  pursuant to this Section 4.8 [and who does not reject it as
                  provided in Section 4.8(a)(2)], the reduced amount of his
                  monthly Retirement Benefit referred to in Section 4.8(a) shall
                  be the Actuarial Equivalent of the Retirement Benefit
                  otherwise payable to such Member under Section 4.1, 4.2, 4.3,
                  4.4 or 4.5, based on the Member's age and his Spouse's age as
                  of the Member's and Spouse's nearest birthday prior to the
                  Annuity Starting Date of his Retirement Benefit, after giving
                  effect to the increased costs of the automatic election under
                  this Section 4.8.

         (2)      The surviving Spouse benefit payable to the surviving Spouse
                  of a Member who is deemed to have made an automatic election
                  pursuant to this Section 4.8 and who dies after such election
                  becomes effective shall be a monthly benefit of 50 percent of
                  the reduced amount of such Member's monthly Retirement Benefit
                  as determined in Section 4.8(b)(1).

(c)      COMMENCEMENT AND DURATION. The monthly surviving Spouse benefit shall
         be payable to the surviving Spouse for life, beginning as of the first
         day of the calendar month coincident with or next following the
         Member's death.

4.9      NORMAL AND OPTIONAL METHODS OF BENEFIT PAYMENTS

(a)      NORMAL FORM FOR UNMARRIED MEMBERS. In the case of an unmarried Member
         who is not subject to the automatic election under Section 4.8, the
         normal form of benefit payment of the monthly Retirement Benefit
         payable under Section 4.1, 4.2, 4.3, 4.4 or 4.5 shall be a single life
         annuity option, so the Member would receive a monthly payment for

                                       26
<PAGE>

         the remainder of his lifetime or until payment is suspended pursuant to
         Section 5.3. Such unmarried Member may elect to receive payment of the
         monthly Retirement Benefit payable to him in one of the optional forms
         of benefit payment described in Section 4.9(c). To make such election,
         such unmarried Member must file a specific written rejection with the
         Committee (on a form approved by the Committee) of the normal form of
         benefit payment applicable to him and elect such optional form of
         benefit payment within the 90-day period ending on his Annuity Starting
         Date ("election period"). If the unmarried Member has filed a specific
         written rejection of such normal form of benefit payment, he may revoke
         such rejection at any time during such election period by executing a
         specific revocation thereof on a form approved by the Committee.
         Further, a subsequent specific written rejection of the normal form of
         benefit payment applicable to the unmarried Member may then be made in
         accordance with the preceding provisions of this Section 4.9(a).

(b)      NORMAL FORM FOR MARRIED MEMBERS. In the case of a married Member who is
         subject to the automatic election under Section 4.8, the normal form of
         benefit payment of the monthly Retirement Benefit payable under Section
         4.1, 4.2, 4.3, 4.4 or 4.5 shall be the automatic form of benefit
         payment described in Section 4.8. A married Member who has rejected the
         automatic election of the Automatic Joint and Surviving Spouse Annuity
         as provided in Section 4.8 may elect to receive payment of the monthly
         Retirement Benefit payable to him in one of the optional forms of
         benefit payment described in Section 4.9(c). The rejection of the
         Automatic Joint and Surviving Spouse Annuity and the election of such
         optional form of benefit payment shall be made in accordance with the
         provisions of Section 4.8 and the applicable provisions of this Section
         4.9.

(c)      OPTIONAL FORMS OF BENEFIT. The election of an optional form of benefit
         payment shall be made in writing on a form approved by the Committee
         and, to the extent required, with spousal consent in the manner
         provided in Section 4.8. Such election shall be considered made as of
         the date on which the application is received by the Committee. The
         option shall not become effective until the Annuity Starting Date for
         the payment of the Member's monthly Retirement Benefit under the
         option. After the election has been made by such Member, and prior to
         the effective date of the option, it may be canceled by the Member at
         any time. A new option may be elected to replace the canceled option,
         subject to the option becoming effective on the Annuity Starting Date
         and subject to Section 4.8. After the effective date of the option, it
         may not be canceled by such Member, but it shall be automatically
         canceled if such Member (or his contingent annuitant under option 2)
         dies before the effective date of the option. If the contingent
         annuitant dies before the effective date, then the Member shall be
         permitted to select another contingent annuitant or optional form of
         benefit, subject to applicable spousal consent requirements. Any
         optional form of benefit must be the Actuarial Equivalent of the
         benefit payable to the Member as a single life annuity.

                                       27
<PAGE>

         The optional forms of benefit payment provided under this Section 4.9
are as follows:

         (1)      SINGLE LIFE ANNUITY OPTION. A Member may elect a monthly
                  Retirement Benefit payable for the life of the Member, with no
                  further payments made after his death.

         (2)      JOINT AND SURVIVOR BENEFIT OPTION. A Member may elect an
                  actuarially reduced monthly Retirement Benefit payable for his
                  lifetime with all, two-thirds or one-half of the reduced
                  amount of monthly benefit continued after his death to his
                  designated Beneficiary as a contingent annuitant. A Member
                  electing this option must designate one person individually as
                  Beneficiary to whom the survivor's benefit under this option
                  is to be paid upon the Member's death. Such designation shall
                  be made in accordance with Section 4.8, if applicable. Each
                  such designation shall be made on a form provided by the
                  Committee, shall be effective only when filed in writing with
                  the Committee prior to the death of the Member and shall
                  revoke all prior designations of a Beneficiary. Upon the death
                  of the designated Beneficiary, no alternate Beneficiary can be
                  substituted unless the Member executes a new election prior to
                  his Annuity Starting Date. All benefit payments shall cease
                  under this option upon the death of the Member and his
                  surviving Spouse or other designated Beneficiary.

         (3)      LUMP SUM OPTION. A Member may elect to receive a single sum in
                  the amount of the Actuarial Equivalent value of his total
                  accrued Retirement Benefit earned as a Salaried Employee
                  and/or as a Nonsalaried Employee if such total value is less
                  than or equal to $7,500 ($3,500 prior to January 1, 1997).
                  Such lump sum payment(s) shall be in complete satisfaction of
                  the Retirement Benefit earned as a Salaried Employee and/or as
                  a Nonsalaried Employee, whichever is applicable.

         In no event shall any optional method of benefit payment reduce the
         value of the Retirement Benefit otherwise payable to the Member by an
         amount greater than the amount permitted under Section 5.2(h). In
         addition, benefit payments with respect to a Member's Retirement
         Benefit shall be subject to the provisions of Section 5.2.

4.10     ADJUSTMENT FOR IN-SERVICE PAYMENTS

In the case of a Participant whose benefit payments commence prior to the date
of his termination of employment as an Employee pursuant to Section 5.2, amounts
payable after the date of his termination of employment as an Employee shall be
reduced to reflect the Actuarial Equivalent value of amounts paid prior to such
termination of employment.

4.11     MAXIMUM ANNUAL BENEFITS

(a)      Notwithstanding any other provisions of the Plan to the contrary, in no
         event may the annual benefit provided under the Plan (together with
         that provided by all other defined benefit plans of the Employers or
         any Affiliate) for any Member for a "Limitation Year," which shall be
         the Plan Year, exceed the lesser of--

                                       28
<PAGE>

         (1)      the dollar limit set forth in Code Section 415(b)(1)(A) [as
                  adjusted by Code Section 415(d)] or

         (2)      100 percent of the Member's average annual Compensation over
                  the three consecutive years of active participation during
                  which he had the greatest aggregate Compensation from the
                  Employers and all Affiliates.

         If the Member has completed less than ten years of participation, the
         limitation in Section 4.11(a)(1) shall be multiplied by a fraction, the
         numerator of which is the Member's number of years (or part thereof) of
         participation in the Plan, and the denominator of which is ten. If the
         Member has completed less than ten years of Vesting Service, the
         limitation in Section 4.11(a)(2), Code Section 415(b)(4) and Section
         4.11(d) shall be adjusted by multiplying such amounts by a fraction,
         the numerator of which is the Member's number of years of Vesting
         Service (or part thereof), and the denominator of which is ten. In no
         event shall the adjustments in the two preceding sentences reduce the
         limitations in Section 4.1l(a)(1) and (2), Code Section 415(b)(4) and
         Section 4.11(d) to an amount less than one-tenth of the applicable
         limitation (determined without regard to such adjustments).

(b)      The provisions of this Section 4.11(b) are effective beginning January
         1, 1997.

         The maximum benefit permitted under Section 4.11(a) shall be in the
         form of a single life annuity (with no ancillary benefits) under a plan
         to which Employees do not contribute and under which no rollover
         contributions are made. If the form of retirement benefits payable to a
         Member is other than a single life annuity or a joint and survivor
         annuity in which the contingent annuitant is the Member's Spouse, the
         retirement benefit for that form of payment shall be adjusted to an
         actuarially equivalent straight life annuity before the application of
         the maximum limitation and, so modified, shall be subject to the
         limitation. The actuarial equivalent shall be the greater of (a) the
         equivalent amount computed using the factors used in determining the
         Actuarial Equivalent for early retirement benefits under the Plan as
         described in Section 4.3 or (b) the equivalent amount computed using 5
         percent interest and the mortality assumptions described in Section
         2.1(a)(2). However, for purposes of adjusting any retirement benefit
         amount that is subject to Section 417(e)(3) of the Code, the interest
         rate described in Section 2.1(a)(1) shall be substituted for the 5
         percent interest rate in the preceding sentence.

         If the retirement benefit of a Member begins before a Member's Social
         Security Retirement Age, but on or after his sixty-second birthday, the
         dollar limitation shall be determined as follows: (a) If a Member's
         Social Security Retirement Age is 65, the dollar limitation for the
         retirement benefit commencing on or after age 62 is determined by
         reducing the dollar limitation by 5/9 of one percent for each month in
         which benefits commence before the month in which the Member attains
         age 65; (b) if a Member's Social Security Retirement Age is greater
         than 65, the dollar limitation for benefits commencing on or after age
         62 is determined by reducing the dollar limitation by 5/9 of one
         percent for each of the first 36 months and 5/12 of one percent for
         each of the

                                       29
<PAGE>

         additional months (up to 24 months) in which the retirement benefit
         commences before the month of the Member's Social Security Retirement
         Age.

         If the retirement benefit of a Member begins before a Member's
         sixty-second birthday, the dollar limitation shall be the Actuarial
         Equivalent of the retirement benefit beginning at age 62, as determined
         above, reduced for each month in which benefits commence before the
         month in which the Member attains age 62. The Actuarial Equivalent
         shall be the lesser of (a) the equivalent amount computed using the
         factors used in determining the Actuarial Equivalent for early
         retirement benefits under the Plan as described in Section 4.3 and (b)
         the equivalent amount computed using 5 percent interest and the
         mortality assumptions described in Section 2.1(a)(2). Any decrease in
         the dollar limitation determined in accordance with this provision
         shall not reflect the mortality decrement to the extent that benefits
         will not be forfeited upon the death of the Member.

         If the retirement benefit of a Member begins after the Member's Social
         Security Retirement Age, the dollar limitation shall be adjusted so
         that it is the Actuarial Equivalent of an annual benefit of such dollar
         limitation beginning at the Member's Social Security Retirement Age.
         The Actuarial Equivalent shall be the lesser of (a) the equivalent
         amount computed using the factors used in determining the Actuarial
         Equivalent as described in Section 2.1(a)(1) and (2) and (b) the
         equivalent amount computed using 5 percent interest and the mortality
         assumptions described in Section 2.1(a)(2).

(c)      The provisions of this Section 4.11(c) are effective prior to January
         1, 1997, and shall be replaced by Section 4.11(b) as of January 1,
         1997.

         The maximum benefit permitted under Section 4.11(a) shall be in the
         form of a single life annuity (with no ancillary benefits) under a plan
         to which Employees do not contribute and under which no rollover
         contributions are made. If the form of retirement benefits payable to a
         Member is other than a single life annuity or a joint and survivor
         annuity in which the contingent annuitant is the Member's Spouse, the
         Member's annual retirement benefit shall not exceed the Actuarial
         Equivalent (using an interest rate not less than 5 percent) of the
         maximum benefit permitted under Section 4.11(a) payable in the form of
         a single life annuity.

         If the retirement benefit of a Member commences before the Member's
         Social Security Retirement Age, the amount in Section 4.11(a)(1) shall
         be adjusted so that it is the Actuarial Equivalent (using an interest
         rate not less than 5 percent) of an annual benefit in such amount,
         beginning at the Social Security Retirement Age. The adjustment
         provided for in the preceding sentence shall be made in the following
         manner:

         (1)      the dollar limitation for benefits commencing on or after age
                  62 is determined by reducing the defined benefit dollar
                  limitation by 5/9 of 1 percent for each of the first 36 months
                  and 5/12 of 1 percent for any additional months (up to 24
                  months) by which the benefits commence before the month in
                  which the Member attains his Social Security Retirement Age;
                  and

                                       30
<PAGE>

         (2)      if the annual benefit of a Member commences before age 62, the
                  defined benefit dollar limitation shall be the Actuarial
                  Equivalent of an annual benefit beginning at age 62 as
                  determined above, reduced for each month by which benefits
                  commence before the month in which the Member attains age 62;
                  provided, however, that the mortality decrement shall not be
                  applied to the extent that benefits will not be forfeited upon
                  the death of the Member.

If the retirement benefit of a Member commences after the Member's Social
Security Retirement Age, the amount in Section 4.11(a)(1) shall be adjusted so
that it is the Actuarial Equivalent (using an interest rate no greater than 5
percent) of an annual benefit in such amount, beginning at the Social Security
Retirement Age.

(d)      If a Member's annual benefit does not exceed $10,000 and if he did not
         participate in any defined contribution plan maintained by the
         Employers or any Affiliate, the limitation described in Section 4.11(a)
         shall not apply.

(e)      The amount in Section 4.11(a)(1) and the amount in Section 4.11(a)(2)
         for a Member who has terminated his employment with the Employers and
         Affiliates shall be automatically adjusted annually for increases in
         the cost of living as provided in Code Section 415(d).

(f)      In applying the limitations on benefits under this Section 4.11, the
         qualified plans of any employer that is an Affiliate shall be
         aggregated with the Plan or any other plan of the Employers or an
         Affiliate if the employer would be an Affiliate if the phrase "at least
         80 percent" in Code Section 1563(a)(1), in applying such section to
         Code Sections 414(b) or 414(c), were replaced with "more than 50
         percent."

(g)      Effective for Limitation Years beginning prior to January 1, 2000, in
         the event that any Member is a participant in a defined contribution
         plan or plans of the Employers or any Affiliate, the sum of the
         "defined benefit plan fraction" and the "defined contribution plan
         fraction" [as such terms are defined in Code Section 415(e)] for any
         Limitation Year with respect to such Member shall not exceed one. If
         such sum would otherwise exceed one, then the Member's Retirement
         Benefit under the Plan shall be reduced to comply with the requirements
         of this Section 4.11(g), unless such reduction is provided for under
         the terms of such defined contribution plan or plans. It is intended to
         reduce the benefits payable under any defined benefit plan to the
         extent possible, if necessary, to prevent the sum of the defined
         benefit plan fraction and the defined contribution plan fraction from
         exceeding 1.0 before reducing contributions to any defined contribution
         plan. In applying the foregoing provisions, the transition rules of
         Section 1106(i)(3), (4) and (6) of the Tax Reform Act of 1986 shall be
         applicable.

4.12     PLAN IN EFFECT AT TERMINATION OF EMPLOYMENT CONTROLS

The terms and provisions of the Plan shall not apply in determining the benefits
payable to any Employee whose employment relationship as an Employee was severed
(for any reason) prior to

                                       31
<PAGE>

January 1, 1997. In such event, the terms and provisions of the Plan in effect
on the date when his employment relationship as an Employee was terminated shall
apply.

4.13 OPTIONAL DIRECT ROLLOVERS OF ELIGIBLE ROLLOVER DISTRIBUTIONS

(a)      IN GENERAL. Notwithstanding any provision of the Plan to the contrary,
         a "Distributee" may elect to have any portion of an "Eligible Rollover
         Distribution" paid directly to an "Eligible Retirement Plan" specified
         by the "Distributee" in a "Direct Rollover" to the extent permitted by
         Code Section 401(a)(31). Terms in quotation marks are defined in
         Section 4.13(b) below.

(b)      DEFINITIONS.

         (1)      "DIRECT ROLLOVER" means a payment by the Plan to the Eligible
                  Retirement Plan specified by the Distributee.

         (2)      "DISTRIBUTEE" means each of the following persons who may
                  elect a Direct Rollover of an Eligible Rollover Distribution
                  of the Member's Retirement Benefit:

                  (A)      the Member;

                  (B)      the Member's Beneficiary, if the Beneficiary was
                           married to the Member on the date of his death; and

                  (C)      an alternate payee under a qualified domestic
                           relations order, as defined in Code Section 414(p),
                           if that person is the Spouse or former Spouse of the
                           Member.

         (3)      "ELIGIBLE RETIREMENT PLAN" means an individual retirement
                  account described in Code Section 408(a), an individual
                  retirement annuity described in Code Section 408(b), an
                  annuity plan described in Code Section 403(a) or a qualified
                  trust described in Code Section 401(a) that accepts the
                  Distributee's Eligible Rollover Distribution. However, in the
                  case of an Eligible Rollover Distribution to the surviving
                  Spouse, an "Eligible Retirement Plan" is an individual
                  retirement account or an individual retirement annuity, as
                  such terms are defined in the preceding sentence.

         (4)      "ELIGIBLE ROLLOVER DISTRIBUTION" means any distribution of all
                  or any portion of the Retirement Benefit payable to the
                  Distributee, except that an "Eligible Rollover Distribution"
                  does not include:

                  (A)      any distribution that is one of a series of
                           substantially equal periodic payments (not less
                           frequently than annually) made for the life (or life
                           expectancy) of the Distributee or the joint lives (or
                           joint life expectancies)

                                       32
<PAGE>

                           of the Distributee or the Distributee's designated
                           Beneficiary, or for a specified period of 10 years or
                           more;

                  (B)      any distribution to the extent such distribution is
                           required under Code Section 401(a)(9);

                  (C)      the portion of any distribution that is not
                           includable in gross income (determined without regard
                           to the exclusion for net unrealized appreciation with
                           respect to employer securities); and

                  (D)      any other amounts which are not considered "Eligible
                           Rollover Distributions" under Code Section
                           401(a)(31).

(c)      No amount shall be directly rolled over pursuant to this Section 4.13
         unless and until it would otherwise be distributed to the Distributee
         and all consents and written elections required to make the
         distribution have been obtained. Nothing in this Section 4.13 shall be
         construed to permit a Distributee to select more than one of the
         optional forms of benefit described in Section 4.9 or elsewhere in the
         Plan.

(d)      The Committee shall provide notice to each Distributee who will receive
         an Eligible Rollover Distribution of the Distributee's right to elect a
         Direct Rollover in accordance with Code Section 401(a)(31). The
         Committee shall provide such notice at the time and in the manner
         required by regulations.

(e)      The Distributee shall notify the Committee in writing by such deadline
         as the Committee shall prescribe whether or not he wishes to have any
         part of the Eligible Rollover Distribution directly rolled over. If the
         Distributee fails to elect a Direct Rollover by the deadline
         established by the Committee, then the entire amount of the Eligible
         Rollover Distribution shall be distributed directly to the Distributee.

(f)      A Distributee may elect that either of the following amounts shall be
         directly rolled over:

         (1)      the entire amount of the Eligible Rollover Distribution; or

         (2)      such portion of the Eligible Rollover Distribution as the
                  Distributee specifies (in accordance with rules established by
                  the Committee).

(g)      The Distributee may only request a Direct Rollover to one Eligible
         Retirement Plan.

(h)      No amount will be directly rolled over pursuant to this Section 4.13
         unless the Distributee provides the Committee, by such deadline as the
         Committee shall prescribe, such information as it shall require--

         (1)      to determine that the amount directly rolled over will be
                  received by an Eligible Retirement Plan that will accept the
                  Direct Rollover; and

                                       33
<PAGE>

         (2)      to make the Direct Rollover and make such reports and keep
                  such records as are required under applicable law. The
                  Committee may rely on all such information provided by the
                  Distributee and shall not be required to verify any such
                  information.

(i)      The Committee shall select the manner in which to make the Direct
         Rollover.

(j)      Any amount directly rolled over in accordance with this Section 4.13
         shall be a distribution from this Plan and shall discharge any
         liability to the Distributee under this Plan to the same extent as a
         payment directly to the Distributee.

(k)      This Plan shall not accept Eligible Rollover Distributions from any
         plan.

4.14     PAYMENT OF SMALL AMOUNTS

Notwithstanding the foregoing provisions of this Article IV, effective as of
January 1, 1997, if the Actuarial Equivalent value of all benefits earned as a
Salaried Employee and a Nonsalaried Employee payable under the Plan (including a
benefit payable in a form as described in Sections 4.7 or 4.8) is less than or
equal to $3,500, such benefit shall be paid in a single sum payment as soon as
administratively practicable following the Member's termination of service. For
purposes of this Section 4.14, the lump sum present value shall be computed
according to the interest rate and mortality assumptions used to calculate the
Actuarial Equivalent. Effective on and after January 1, 2002, "$5,000" shall be
substituted for "$3,500" in the first sentence of this Section 4.14.

4.15     SPECIAL COMMENCEMENT RULE FOR CERTAIN FORMER PARTICIPANTS

(a)      ELIGIBILITY. Notwithstanding any Plan provisions to the contrary, any
         Former Participant who is not in current employment on or after January
         1, 1997, who is entitled to receive a Retirement Benefit under the Plan
         or Prior Plans as in effect on his date of termination of employment as
         an Employee and who is not otherwise eligible to commence distribution
         of his Retirement Benefits under such plan before January 1, 1997 shall
         be eligible to receive an immediate reduced Vested Retirement Benefit
         as described in this Section 4.15.

(b)      AMOUNT. A Former Participant who has terminated his employment as an
         Employee and satisfies the other eligibility requirements described in
         Section 4.15(a) shall be entitled to elect to receive a Vested
         Retirement Benefit commencing as provided in Section 4.15(c).

         Notwithstanding any provisions of the Plan to the contrary, such Vested
         Retirement Benefit shall be equal to an immediate reduced Vested
         Retirement Benefit commencing as provided in Section 4.15(c) computed
         as of the first day of the month coincident with or next following
         attainment of his Normal Retirement Age in the manner set forth in this
         Plan or the Prior Plans, whichever is applicable, based on the factors
         and the provisions of said plan, provided that he has a vested interest
         as determined under the terms of said plan and further adjusted as
         provided below.

                                       34
<PAGE>

         Notwithstanding any provisions of the Plan to the contrary, the
         immediate reduced Vested Retirement Benefit described in this Section
         4.15 shall be payable only in the following forms:

         (1)      subject to the consent requirements referenced in Section
                  4.8(a) or (b), a lump sum distribution equal to the Actuarial
                  Equivalent as of the Annuity Starting Date of the amount
                  determined in the preceding paragraph of this Section 4.15(b).
                  Any Former Participant who receives such a distribution shall
                  have no further interest in the Plan; or

         (2)      an immediate annuity payable in the Former Participant's
                  normal form of benefit payment as described in Section 4.8(a)
                  or (b), whichever is applicable. Such immediate annuity shall
                  be actuarially equivalent to the lump sum distribution as
                  calculated above in Section 4.15(b)(1).

         The other optional forms of benefit described in Section 4.8(c) shall
         not be available for any distribution under this Section 4.15.

(c)      COMMENCEMENT. The Committee shall notify each Former Participant who is
         eligible to elect to receive a distribution under this Section 4.15 by
         sending a notice to his last known address. An application for
         commencement must be made within the election period determined in
         accordance with the administrative procedures established by the
         Committee. The distribution shall commence as soon as administratively
         practicable following the receipt of his completed consent form, but in
         no event prior to January 1, 1997.

         If the Former Participant does not file a timely consent to a current
         distribution in accordance with this Section 4.15, then distribution of
         his Retirement Benefit shall not commence prior to the date otherwise
         provided in the Prior Plan.

                                       35
<PAGE>

ARTICLE V.  COMMENCEMENT OF BENEFIT PAYMENTS AND DURATION

5.1      COMMENCEMENT AND DURATION

(a)      The monthly Retirement Benefit payments to which an eligible Member is
         entitled under Section 4.1, 4.2, 4.3, 4.4 or 4.5 shall begin as
         described below:

         (1)      NORMAL AND LATE RETIREMENT BENEFITS. A Member entitled to a
                  Retirement Benefit under Section 4.1 or 4.2 shall start
                  receiving such Benefit as of the retired Member's Normal
                  Retirement Date (in the case of a Normal Retirement Benefit),
                  the retired Member's Late Retirement Date (in the case of a
                  Late Retirement Benefit) or on the first day of the month
                  following the month that he is employed at a rate at which he
                  will work fewer than eight days during any calendar month. A
                  Member who continues in employment as an Employee after
                  attaining his Normal Retirement Age at a greater rate shall
                  have his Normal Retirement Benefit or his Late Retirement
                  Benefit (as the case may be) suspended in the manner described
                  in Section 5.4, and he shall receive the notice described in
                  Section 5.5.

         (2)      EARLY RETIREMENT BENEFITS. A Member entitled to a Retirement
                  Benefit under Section 4.3 shall start receiving such
                  Retirement Benefit as of the retired Member's Early Retirement
                  Date if he has given the Committee sufficient written notice
                  of his intention to take early retirement. If the Member does
                  not elect immediate distribution, then he may elect to defer
                  commencement until a later date which is not later than his
                  Normal Retirement Date, provided that he gives the Committee
                  not more than 90 days' notice of such later commencement date.

         (3)      DISABILITY RETIREMENT BENEFITS. A Member entitled to a
                  Retirement Benefit under Section 4.4 shall start receiving
                  such Retirement Benefit as of the terminated Member's Normal
                  Retirement Date with respect to such benefit earned as a
                  Salaried Participant and as of the terminated Member's
                  Disability Retirement Date with respect to such benefit earned
                  as a Nonsalaried Participant.

         (4)      VESTED RETIREMENT BENEFITS. A Member entitled to a Retirement
                  Benefit under Section 4.5 shall start receiving such
                  Retirement Benefit as of the terminated Member's Vested
                  Retirement Date. Application for commencement prior to his
                  Normal Retirement Date must be made at least 30 days but not
                  more than 90 days prior to the date he elects to have
                  distribution commence. Notwithstanding any provisions to the
                  contrary, if the Member is under age fifty-five on the date of
                  his termination of employment as an Employee and wants to
                  receive an immediate reduced Vested Retirement Benefit, his
                  application for commencement must be made within the election
                  period determined in accordance with the administrative
                  procedures established by the Committee and the distribution
                  shall commence as soon as administratively practicable
                  following his termination of employment as an Employee. If the
                  Member does not file a timely consent to distribution, then

                                       36
<PAGE>

                  distribution shall not commence prior to his Normal Retirement
                  Date unless he elects to receive a reduced benefit following
                  his fifty-fifth birthday.

         (5)      SALARIED AND NONSALARIED BENEFITS. If a Member is entitled to
                  benefits as a Salaried Employee and as a Nonsalaried Employee,
                  then the form of benefit payment, commencement date and the
                  duration of each such Retirement Benefit shall be determined
                  independently, except as otherwise expressly provided. No
                  Retirement Benefit can begin until the Participant ceases to
                  be an Employee.

         (6)      PAYMENT OF SMALL AMOUNTS. Notwithstanding any Plan provisions
                  to the contrary, if the Actuarial Equivalent value of a
                  Member's total benefit earned as a Salaried Employee and as a
                  Nonsalaried Employee payable under the Plan (including a
                  benefit payable in a form as described in Sections 4.8 or 4.9)
                  is less than or equal to $3,500, such benefit shall
                  automatically be distributed as provided under Section 4.14;
                  provided, however, that prior to January 1, 1997, the
                  distribution shall not be automatic but the Member may elect
                  to have such benefit paid to him in a single lump sum payment
                  as soon as administratively practicable following such
                  Member's termination of employment as an Employee. Effective
                  on and after _______________, "$5,000" shall be substituted
                  for $3,500" in the preceding sentence. For purposes of this
                  Section 5.1(a), the lump sum present value shall be computed
                  according to the interest rate and mortality assumptions used
                  to calculate the Actuarial Equivalent.

(b)      Notwithstanding the provisions of Section 5.1(a), if the value of a
         Member's total nonforfeitable Retirement Benefit earned as a Salaried
         Employee and as a Nonsalaried Employee exceeds $3,500, then payment of
         the Member's Retirement Benefit shall not commence at any time before
         the Member attains his Normal Retirement Age without his written
         consent (or where the Member has died and a Spouse's benefit is to be
         paid to his surviving Spouse, the written consent of such Spouse).
         Effective on and after ________, "$5,000" shall be substituted for
         $3,500" in the preceding sentence.

(c)      Unless the Member otherwise elects, the commencement of a Member's
         Retirement Benefit payments shall begin not later than the sixtieth day
         after the latest to close of the Plan Year in which--

         (1)      the Member attains or would have attained his Normal
                  Retirement Age;

         (2)      the tenth anniversary of the year in which the Member
                  commenced participation in the Plan occurs; or

         (3)      the Member's termination of employment as an Employee occurs.

5.2 REQUIRED AND MINIMUM DISTRIBUTION RULES

Notwithstanding any of the preceding provisions of this Article V, the following
provisions shall apply to the payment of Retirement Benefits:

                                       37
<PAGE>

(a)      In no event may the payment of a Member's Retirement Benefit commence
         later than the April 1 of the calendar year following the calendar year
         in which the Member attains age 70 1/2; provided, however, that in the
         case of a Member who attained age 70 1/2prior to January 1, 1988, and
         who is not a "5-percent owner" [as defined in Code Section 416(i)(1)(B)
         and as further described under the regulations under Code Section
         401(a)(9)], such payment shall be required to be commenced on or before
         the April 1 of the calendar year following the calendar year in which
         the Member terminates employment as an Employee or, if earlier, April 1
         of the calendar year following the calendar year in which the Member
         becomes such a "5-percent owner"; and, provided further, that in the
         case of a Member who attained age 70 1/2during the 1988 calendar year
         and who is not such a "5-percent owner," such payment shall be required
         to commence by no later than April 1, 1990. For purposes of this
         Section 5.2(a), a "5-percent owner" means any Employee who was a
         "5-percent owner" at any time during the five-Plan-Year period ending
         in the calendar year in which the Employee attains age 70 1/2or in any
         subsequent Plan Year.

         Notwithstanding the foregoing, effective for participants who attain
         age 70 1/2 on and after January 1, 2002, in no event may the payment of
         a Member's Retirement Benefit (provided the member is not a "5-percent
         owner", as defined above) commence later than the later of (i) the
         April 1 of the calendar year following the calendar year in which the
         Member attains age 70 1/2; or (ii) the April 1 of the calendar year
         following the calendar year in which the participant retires. If a
         Member retires in a calendar year after the calendar year in which the
         Member attains age 70 1/2, the Member's retirement benefit shall be
         actuarially increased in accordance with Notice 97-75, or other
         applicable guidance, to take into account the period after age 70 1/2
         in which the Member was not receiving any benefits under the Plan.

(b)      A Member's Retirement Benefit shall be distributed by a method of
         benefit payment beginning not later than the date required pursuant to
         Section 5.2(a), over the life of the Member or over the lives of such
         Member and a designated Beneficiary or surviving Spouse or within or
         over a period not extending beyond the life expectancy of such Member
         or the life expectancy of such Member and a designated Beneficiary or
         surviving Spouse.

(c)      If the payment of a Member's Retirement Benefit has begun in accordance
         with Section 5.2(a) and the Member dies before his entire interest has
         been paid to him, the remaining portion of the Member's Retirement
         Benefit shall be paid at least as rapidly as under the method of
         benefit payment being used under Section 5.2(b) as of the date of his
         death.

(d)      If a Member dies prior to the commencement of the payment of his
         Retirement Benefit, any survivor benefit paid with respect to the
         Member's Retirement Benefit shall be paid within five years after the
         death of such Member, except as permitted under Sections 5.2(e) and
         (f).

(e)      If--

                                       38
<PAGE>

         (1)      any portion of the Member's Retirement Benefit is payable to
                  his surviving Spouse;

         (2)      such portion is to be paid over the life of such surviving
                  Spouse or within or over a period not extending beyond the
                  life expectancy of the surviving Spouse; and

         (3)      such payments begin not later than one year after the date of
                  the Member's death, or such later date as the Secretary of the
                  Treasury may by regulations prescribe, the portion referred to
                  in Section 5.2(e)(1) shall be treated as distributed within
                  the time required under Section 5.2(d).

(f)      The date on which payments are required to begin under Section
         5.2(e)(3) shall not be earlier than the date on which the Member would
         have attained age 70-1/2.

(g)      In addition to the foregoing provisions of this Section 5.2, all
         distributions of or with respect to any Retirement Benefit shall be
         made in accordance with Code Section 401(a)(9) (including the
         regulations thereunder), and the provisions of the Plan relating to the
         payment of such distributions shall be interpreted and applied in
         accordance with Code Section 401(a)(9). The provisions of such Code
         Section 401(a)(9) shall control over any distribution option or other
         provision of the Plan which is inconsistent with the provisions of Code
         Section 401(a)(9).

(h)      In any case where the payment of a Member's Retirement Benefit is
         payable in a joint and survivor annuity form, the periodic survivor
         annuity payment payable to the Member's contingent annuitant shall not
         exceed the "applicable percentage" of the annuity payments payable to
         the Member. In addition, if the payment of a Member's Retirement
         Benefit is payable in either a life annuity or joint and survivor
         annuity form with an associated period certain guaranteed payment
         feature, the period certain shall not exceed the "applicable divisor"
         period determined by reference to the Member's age at the time his
         benefit payments commence. The foregoing limitations of this Section
         5.2(h) shall not apply if the contingent annuitant or designated
         Beneficiary of the Member is the Member's surviving Spouse. The
         "applicable percentage" and "applicable divisor" shall be the
         "applicable percentage" and "applicable divisor" determined pursuant to
         regulations issued by the Secretary of the Treasury under Code Section
         401(a)(9).

5.3 REEMPLOYMENT AFTER BENEFIT COMMENCEMENT BUT PRIOR TO NORMAL RETIREMENT AGE

If a Member whose Retirement Benefit has commenced is reemployed as an Eligible
Employee before attaining his Normal Retirement Age, his Retirement Benefit
payments shall be suspended and shall not be paid or accrue during the period of
such reemployment, his previous election of form of benefit payment shall be
canceled and he shall have the Vesting Service and Salaried and/or Nonsalaried
Benefit Service he had at the time of his retirement reinstated. Upon his
subsequent termination of employment as an Employee, his eligibility for a
Retirement Benefit and the amount of such Retirement Benefit shall be
determined, calculated and paid as if

                                       39
<PAGE>

he were then first retired based upon such reinstated Vesting Service and
Salaried and/or Nonsalaried Benefit Service, plus Vesting Service and Salaried
and/or Nonsalaried Benefit Service earned following the date of reemployment;
but such Retirement Benefit shall be actuarially reduced to account for any
Retirement Benefit payments he may have received prior to his reemployment. In
no event shall a Member's Retirement Benefit at his subsequent termination of
employment as an Employee be less than his Retirement Benefit at his prior
termination of employment. The foregoing notwithstanding, if a Member reemployed
as described above subsequently reaches his Normal Retirement Age and is
employed at a rate at which he will work fewer than eight days during any
calendar month, the Member may continue to receive any benefits which he is
receiving at the time of reemployment. Such payments shall continue every month
thereafter until his employment is at a rate at which he would work eight or
more days per calendar month, at which time his benefits shall be suspended
under the terms and conditions described in Section 5.4. The foregoing
notwithstanding, if an Employee is rehired on a "temporary" basis (i.e.,
expected duration of employment is three months or less), his Retirement Benefit
payments shall continue to be paid during such period of temporary employment.

5.4 REEMPLOYMENT AFTER BENEFIT COMMENCEMENT AND AFTER ATTAINING NORMAL
    RETIREMENT AGE

If a Member is reemployed as an Eligible Employee after attaining his Normal
Retirement Age at a rate at which he would work eight or more days in a calendar
month, his Retirement Benefit payments shall be suspended and shall not be paid
or accrue during the period of such reemployment, his previous election of form
of benefit payment shall be canceled and he shall have the Vesting Service and
Salaried and/or Nonsalaried Benefit Service he had at the time of his retirement
reinstated. Such suspension of benefits shall be done in accordance with
Department of Labor Regulation Section 2530.203-3 and shall include the notice
described in Section 5.5. Upon his subsequent termination of employment as an
Employee, his eligibility for a Retirement Benefit and the amount of such
Retirement Benefit shall be determined, calculated and paid as if he were then
first retired based upon such reinstated Vesting Service and Salaried and/or
Nonsalaried Benefit Service plus Vesting Service and Salaried and/or Nonsalaried
Benefit Service earned following the date of reemployment; but such Retirement
Benefit shall be actuarially reduced to account for any Retirement Benefit
payments he may have received prior to his reemployment. In no event shall a
Member's Retirement Benefit at subsequent termination of employment as an
Employee be less than his Retirement Benefit at his prior termination of
employment. If a Member is reemployed as an Employee after attaining his Normal
Retirement Age at a rate at which he would not work at least eight days during a
calendar month, he shall receive the same type and amount of Retirement Benefit
payment he was entitled to receive preceding his reemployment during such period
of reemployment. Such payments shall continue every month thereafter until his
employment is at a rate at which he would work eight days during a calendar
month, at which time his Retirement Benefit shall be suspended as described
above. The foregoing notwithstanding, if an Employee is rehired on a "temporary"
basis (i.e., expected duration of employment is three months or less), his
Retirement Benefit payments shall continue to be paid during such period of
temporary employment.

                                       40
<PAGE>

5.5      SUSPENSION OF BENEFITS NOTICE AND PROCEDURES

If an Employee's Retirement Benefit payments are to be suspended as a result of
his continued employment or reemployment, the Plan shall notify the Employee, by
personal delivery or first-class mail during the first calendar month in which
the Plan withholds payments, that his Retirement Benefit payments are suspended.
The notice shall contain--

(a)      a general description of the reasons why payments are suspended;

(b)      a general description of the Plan provisions relating to the suspension
         of benefits;

(c)      a copy of such Plan provisions;

(d)      a statement that a review of the suspension may be requested under the
         claims procedure found in the Plan;

(e)      if the Plan requires a benefit resumption notice, the procedure and
         forms; and

(f)      if the Plan requires verification by the Employee that his benefits
         should not be suspended, the procedure and forms for such verification.

The Plan shall adopt a procedure whereby an individual may request a
determination of whether specific contemplated employment will result in a
suspension of benefits.

                                       41
<PAGE>

ARTICLE VI.  PLAN ADMINISTRATION

6.1 APPOINTMENT OF COMMITTEE

The Sponsor shall be the "plan administrator" with respect to the Plan and a
"named fiduciary" with respect to the Plan and Trust Fund, as such terms are
defined under ERISA. The Board of Directors of the Sponsor shall appoint a plan
administration committee ("Committee") to administer the Plan and to handle the
day-to-day administrative responsibilities with respect to the Plan. The
Committee shall have all powers necessary to accomplish such purposes. The
Committee shall be composed of three or more members as the Board of Directors
may appoint from time to time, and such members shall hold office at the
pleasure of the Board of Directors. Each member or successor must signify
acceptance of this position in writing. Any member of the Committee may resign
at any time by delivering his written resignation to the Sponsor and to the
Chairman of the Committee to take effect on a date specified therein, or upon
delivery to the Sponsor, if no date is specified. Termination of employment of
an Employee who is a member of the Committee shall automatically constitute a
resignation. The Board of Directors may remove any member of the Committee with
or without cause by so notifying the member and the Chairman of the Committee in
writing to take effect not less than 30 days after delivery thereof, unless such
notice shall be waived. Vacancies on the Committee shall be filled by action of
the Sponsor. In the event no successor member is appointed, the remaining
member(s) or, if none remain, the Sponsor shall function as the Committee until
a new Committee has been appointed and has accepted such appointment.

6.2 COMPENSATION AND EXPENSES

(a)      A member of the Committee shall serve without compensation for services
         as such if he is receiving full-time pay as an Employee. Any other
         member of the Committee may receive compensation for services as a
         member. Any member of the Committee may receive reimbursement of
         expenses properly and actually incurred. Any such compensation or
         reimbursement shall be paid in accordance with the provisions of
         Section 6.2(b).

(b)      All expenses incident to the administration, termination or protection
         of the Plan and Trust including, but not limited to, fees of actuaries,
         accountants, premiums payable to the PBGC, counsel and other
         specialists and other costs of administering the Plan shall be paid by,
         and constitute a charge upon, the Trust Fund, except to the extent that
         such expenses, or any portion thereof, may have been paid by the
         Employer in its sole and absolute discretion.

6.3 MANNER OF ACTION

A majority of the members of the Committee at that time in office shall
constitute a quorum for the transaction of business. All resolutions adopted,
and other actions taken by the Committee at any meeting, shall be by the vote of
a majority of those present at any such meeting. Upon concurrence in writing of
a majority of the members at that time in office, action of the Committee may be
taken otherwise than at a meeting.

                                       42
<PAGE>

6.4 CHAIRMAN, SECRETARY AND EMPLOYMENT OF SPECIALISTS

The members of the Committee shall elect one of their number as Chairman and
shall elect a Secretary who is an employee of the Employer and may, but need
not, be a member of the Committee. They may authorize one or more of their
number or any agent to execute or deliver any instrument or instruments on their
behalf and may employ such counsel, auditors and other specialists; and such
clerical, medical, actuarial and other services as they may require in carrying
out the provisions of the Plan. Such expenses shall be paid in accordance with
the provisions of Section 6.2(b).

The Committee and the Employer shall be entitled to rely conclusively upon the
tables, valuations, certificates and reports furnished by an actuary or
accountant employed by the Committee or an insurer issuing life insurance
contracts under this Plan and/or upon opinions of counsel or other experts; and
such members, and each of them, shall be fully protected as to any action taken
or allowed by them in good faith and reliance upon any such tables, valuations,
certificates, reports or opinions; and all actions taken or allowed by them
shall be conclusive upon all persons having or claiming any interest under the
Plan.

6.5 DELEGATION OF RESPONSIBILITIES

The Committee may appoint one or more individuals and delegate such of its power
and duties as it deems desirable to any such individual, in which case, every
reference herein made to the Committee shall be deemed to mean or include the
individuals as to matters within their jurisdiction. Such individuals shall be
such officers or other Employees of the Employers and such other persons as the
Committee may appoint.

6.6 RECORDS

All resolutions, proceedings, acts and determinations of the Committee shall be
recorded by the Secretary thereof or under his supervision; and all such records
together with such documents and instruments as may be necessary for the
administration of the Plan shall be preserved in the custody of the Secretary or
his delegate(s).

6.7 RULES

Subject to the limitations contained in the Plan, the Committee shall be
empowered from time to time in its discretion to adopt bylaws and establish
rules for the conduct of its affairs and the exercise of the duties imposed upon
it under the Plan.

                                       43
<PAGE>

6.8 ADMINISTRATION

The Committee shall be responsible for the administration of the Plan. The
Committee shall have all such powers as may be necessary to carry out the
provisions of the Plan and may from time to time establish rules for the
administration of the Plan and the transaction of the Plan's business. In making
any such determination or rule, the Committee shall pursue uniform policies as
from time to time established by the Committee and shall not discriminate in
favor of or against any Member. The Committee shall have the exclusive right to
make any finding of fact necessary or appropriate for any purpose under the Plan
including, but not limited to, the determination of whether a Beneficiary or
Member is eligible for any benefit payable under the Plan and the amount of such
benefit. The Committee shall have sole and absolute discretion to interpret the
terms and provisions of the Plan and to determine any and all questions arising
under the Plan or in connection with the administration thereof, including,
without limitation, the right to remedy or resolve possible ambiguities,
inconsistencies or omissions by general rule or particular decision. The
Committee shall make, or cause to be made, such reports as are required by law.
To the extent permitted by law, all findings of fact, determinations,
interpretations and decisions of the Committee in respect of any matter or
question arising under the Plan shall be final, conclusive and binding upon all
persons having or claiming to have any interest or right under the Plan and
shall be given the maximum possible deference allowed by law. If challenged in
court, any decision of the Committee shall not be subject to DE NOVO review and
shall not be overturned unless proven to be arbitrary and capricious under the
evidence considered at the time of such decision.

6.9 APPEALS FROM DENIAL OF CLAIMS

If any claim for benefits under the Plan is wholly or partially denied, the
claimant shall be given notice in writing of such denial within a reasonable
period of time (not to exceed 90 days after receipt of the claim, or if special
circumstances require an extension of time, written notice of the extension
shall be furnished to the claimant and an additional 90 days will be considered
reasonable) setting forth the following information:

(a)      the specific reason or reasons for the denial;

(b)      specific reference to pertinent Plan provisions on which the denial is
         based;

(c)      a description of any additional material or information necessary for
         the claimant to perfect the claim and an explanation of why such
         material or information is necessary;

(d)      an explanation that a full and fair review by the Committee of the
         decision denying the claim may be requested by the claimant or his
         authorized representative by filing with the Committee, within 60 days
         after such notice has been received, a written request for such review;
         and

(e)      if such request is so filed, the claimant or his authorized
         representative may review pertinent documents and submit issues and
         comments in writing within the same 60-day period specified in Section
         6.9(d).

                                       44
<PAGE>

The decision of the Committee shall be made promptly, and not later than 60 days
after the Committee's receipt of the request for review, unless special
circumstances require an extension of time for processing, in which case, the
claimant shall be so notified and a decision shall be rendered as soon as
possible, but not later than 120 days after receipt of the request for review.
The claimant shall be given a copy of the decision promptly. The decision shall
be in writing and shall include specific reasons for the decision, written in a
manner calculated to be understood by the claimant and specific references to
the pertinent Plan provisions on which the decision is based.

6.10 NOTICE OF ADDRESS AND MISSING PERSONS

Each person entitled to benefits under the Plan must file with the Committee, in
writing, his post office address and each change of post office address. Any
communication, statement or notice addressed to such a person at his latest
reported post office address will be binding upon him for all purposes of the
Plan and neither the Committee nor the Employers or Trustee shall be obliged to
search for or ascertain his whereabouts. In the event that such person cannot be
located, after reasonable efforts to locate such person have been made, the
Committee may direct that such benefits and all further benefits with respect to
such person shall be discontinued, all liability for the payment thereof shall
terminate and such person's remaining accrued benefit under the Plan shall be
deemed a forfeiture; provided, however, that in the event of the subsequent
reappearance of such person prior to the termination of the Plan, the benefits
which were due and payable and which such person missed shall be paid in a
single sum without interest and the future benefits due such person shall be
reinstated in full.

6.11 APPLICATION FOR BENEFITS AND DATA

All persons claiming benefits under the Plan must make application and furnish
to the Committee or its designated agent, such documents, evidence, or
information as the Committee or its designated agent considers necessary or
desirable for the purpose of administering the Plan; and each such person must
furnish such information promptly and sign such documents as the Committee or
its designated agent may require before any benefits become payable under the
Plan.

6.12 INDEMNITY FOR LIABILITY

The Sponsor or any Employer may indemnify and hold harmless the members of the
Committee, members of the Board of Directors, any administrator and any other
person who is deemed to be a "fiduciary" under either statutory or common law
and who is also an Employee, officer or director of the Employer from and
against any damages, judgments, settlements, costs, charges or expenses incurred
in connection with the defense of any action, suit or proceeding to which any
such person may be a party or which may be threatened against any such person or
in connection with any appeal therefrom by virtue of any wrongful act or
omission in their respective capacities for the Plan; provided, however, that
notwithstanding anything to the contrary herein, the foregoing indemnification
shall extend and be effective only to the extent

                                       45
<PAGE>

that the same shall be valid and enforceable under all applicable laws. The
extent of such indemnification shall be expressed in a resolution by the Board
of Directors.

When making a determination or calculation, the Committee shall be entitled to
rely conclusively upon, and shall be fully protected by the Employer in any
action it may suffer in reliance upon, information furnished by the Employer.
The Employer and the Committee shall be entitled to rely upon all certificates
and reports furnished by any consultant and actuary and upon all opinions given
by legal counsel selected by the Employer and Committee.

                                       46
<PAGE>

ARTICLE VII. FINANCING

7.1 FUNDING

A Trustee shall be designated by the Sponsor, and a Trust Agreement maintained
between the Sponsor and the Trustee, under the terms of which a Trust Fund shall
be established to receive and hold contributions payable by the Employer,
interest and other income and to pay the benefits provided by the Plan. The
Sponsor may, by appropriate action and in accordance with any terms of the Trust
Agreement, employ an investment manager to invest and manage all or any
specified portion of the Trust Fund. Said investment manager shall designate in
writing that he is a fiduciary with respect to Trust assets under his control,
and the Trustee shall not be liable for nor have any responsibility in
connection with acts or omissions of the investment manager with regard to any
assets subject to his management. Any Trust Agreement entered into shall be
deemed to form a part of the Plan, and any and all rights and benefits which may
accrue to any person under the Plan shall be subject to all the terms and
provisions of such Trust Agreement. The Sponsor may modify the Trust Agreement
from time to time to accomplish the purpose of the Plan and may replace any
Trustee and appoint a successor Trustee or Trustees.

7.2 CONTRIBUTIONS

The Employer shall make such contributions to the Trust Fund as shall be
determined by the Actuary to be required under accepted actuarial principles to
at least be sufficient to maintain the Plan as a qualified employee defined
benefit pension plan meeting the plan qualification requirements of the Code and
the minimum funding standard requirements of the Code and ERISA for the Employer
contributions for any Plan Year. In no event shall an Employer make a
contribution to the Plan on behalf of any Member which is not otherwise
deductible by the Employer under Code Section 404. Forfeitures arising under the
Plan for any reason shall be used as soon as possible to reduce Employer
contributions under the Plan. Employee contributions under the Plan shall
neither be required nor permitted. All benefits under the Plan shall be payable
only from the Trust Fund and no liability for the payment of benefits under the
Plan shall be imposed upon the Employer, the Committee, officers, directors or
shareholders of the Employer.

                                       47
<PAGE>

ARTICLE VIII.  AMENDMENT AND TERMINATION

8.1 AMENDMENT AND TERMINATION

(a)      The Sponsor does hereby expressly and specifically reserve the sole and
         exclusive right at any time, and from time to time, by action of the
         Board of Directors to amend, modify or terminate the Plan to the extent
         that it may deem advisable; provided, however, the Board of Directors
         may delegate to the Committee or any other party it deems appropriate
         the authority to amend, modify or terminate the Plan in all respects or
         with regard to specified limited powers. Any amendment, modification or
         termination as aforesaid shall not require the assent, concurrence or
         any other action by any Employer or the Trustee notwithstanding that
         such action by the Sponsor may relate in whole or in part to persons in
         the employ of any Employer. The amendments or modifications made to the
         Plan by the Sponsor shall apply to the Plan as a whole, except to the
         extent any such amendment or modification is made to the Plan as it
         relates to any particular Employer and is made on the basis of
         information communicated to the Sponsor by the Employer and approved by
         the Sponsor.

(b)      While each Employer contemplates carrying out the provisions of the
         Plan indefinitely with respect to its Employees, no Employer shall be
         under any obligation or liability whatsoever to maintain the Plan for
         any minimum or other period of time.

(c)      Any action taken to amend, modify or terminate the Plan shall be
         evidenced by a written instrument duly executed and/or certified by an
         officer of the Sponsor. Any such instrument evidencing an amendment to
         the Plan shall be delivered by the Sponsor to the Committee, the
         Trustee and any Employer involved.

(d)      Upon any termination of the Plan (full or partial), the Sponsor shall
         give written notice thereof to the Committee, the Trustee and any
         Employer involved. Each of the affected Members shall have a fully
         vested and nonforfeitable interest in his accrued benefit to the extent
         funded.

(e)      Upon a complete or partial termination of the Plan [within the meaning
         of Code Section 411(d)(3)], the right of each affected Member to
         benefits accrued to the date of such termination or partial termination
         shall become nonforfeitable to the extent such benefits are funded as
         of such date; provided, however, a Member's recourse towards
         satisfaction of his nonforfeitable benefits shall be limited to the
         assets of the Trust Fund and the benefits of certain Members shall be
         further restricted as provided in Sections 4.11 and 8.5.

(f)      Upon any termination of the Plan, no Employer with respect to whom the
         Plan is terminated (including the Sponsor) shall thereafter be under
         any obligation, liability or responsibility whatsoever to make any
         contribution or payment to the Trust Fund, the Plan, any Member, any
         Beneficiary or any other person or trust or fund whatsoever, for any
         purpose whatsoever under or in connection with the Plan.

                                       48
<PAGE>

8.2      LIMITATIONS ON AMENDMENTS

The provisions of this Article VIII relating to amendments to the Plan shall be
subject to and limited by the following restrictions:

(a)      No amendment shall operate either directly or indirectly to give any
         Employer any interest whatsoever in any funds or property held by the
         Trustee under the terms of the Plan, or to permit the corpus or income
         of the Trust Fund to be used for or diverted to purposes other than the
         exclusive benefit of Members, their surviving Spouses or Beneficiaries
         or the payment of the reasonable expenses of administering the Plan.

(b)      No such amendment shall operate either directly or indirectly to
         deprive any Member, surviving Spouse or Beneficiary of his vested and
         nonforfeitable interest as of the time of such amendment. Any amendment
         which modifies the vesting provisions under the Plan shall either
         provide for a rate of vesting which is more rapid than the vesting
         schedule previously in effect, or provide that any Participant with at
         least three years of Vesting Service may elect, in writing, to remain
         under the vesting schedule in effect prior to the amendment. Such
         election must be made within 60 days after the latest of (1) the day
         the amendment is adopted; (2) the day the amendment becomes effective;
         or (3) the day the Participant has received notice of the amendment.

(c)      No amendment shall decrease the accrued benefit of any Member within
         the meaning of Code Section 411(d)(6), except as may be permitted under
         Code Section 411(d)(6).

(d)      No amendment shall change the rights, duties or responsibilities of the
         Trustee under the Plan without its written consent.

Subject to the foregoing limitations, any amendment which, in the judgment of
the Committee is necessary or advisable, may be made retroactively, provided
that such retroactive amendment does not deprive a Member, surviving Spouse or
Beneficiary, without his consent, of a right to receive benefits under the Plan
which have already vested and matured, except as such modification or amendment
shall be necessary in order to comply with any laws or regulations of the United
States or of any state to qualify this as a tax exempt Plan and Trust, or
otherwise.

8.3      DISTRIBUTION ON TERMINATION

(a)      Upon any termination (full or partial), all unallocated amounts shall
         be allocated in accordance with the provisions hereof. Upon termination
         of the Plan, the Employer with the consent of the Sponsor, by written
         notice to the Trustee, may direct either--

         (1)      continuation of the Trust and the distribution of benefits at
                  such time and in such manner as though the Plan had not been
                  terminated; or

         (2)      subject to Section 8.3(b), complete distribution of the assets
                  in the Trust Fund to the Members and their surviving Spouses
                  or Beneficiaries, in one lump-sum cash payment, or in the form
                  of a deferred annuity payable at Normal Retirement Date,

                                       49
<PAGE>

                  as soon as the Committee deems it in the best interest of the
                  Members and their surviving Spouses or Beneficiaries (no later
                  than three years after such termination).

(b)      Upon the termination of the Plan, that portion of any assets then held
         in the Trust Fund which remain after payment of all expenses of
         administration or liquidation shall be allocated for the purpose of
         paying benefits under the Plan in the order of precedence and in the
         amounts indicated for plans covered under Section 4044 of ERISA,
         according to the principles set forth in said Section 4044. The benefit
         of a missing Member shall be distributed in accordance with ERISA
         Section 4050. Following the termination of the Plan, benefit
         distributions to Members and their surviving Spouses or Beneficiaries
         shall be made through the continuation of the Plan and Trust Fund, as
         such benefits become due and payable under the Plan; provided, however,
         that if the assets of the Trust Fund are sufficient to provide the
         Members' current accrued benefits, the Committee shall direct the
         Trustee to liquidate the Trust Fund and make benefit distributions to
         Members and their surviving Spouses or Beneficiaries. In such case,
         such distributions shall be made in accordance with applicable
         amendments to the Plan relating to the termination of the Plan. To the
         extent necessary, such amendments shall require that the Plan be
         terminated in accordance with the Single-Employer Pension Plan
         Amendments Act of 1986, and applicable regulations thereunder, prior to
         the commencement of such distributions. In any case where there are
         assets in the Trust Fund remaining after the satisfaction of all
         accrued benefit liabilities to Members and their surviving Spouses or
         Beneficiaries following the termination of the Plan, such assets shall
         revert to and be distributed to the Employers.

(c)      Notwithstanding any of the above provisions of this Section 8.3,
         distributions to married Members shall be subject to the provisions of
         Section 4.8.

8.4      EFFECT OF CONTINGENCIES AFFECTING THE EMPLOYER

In the event an Employer terminates its connection with the Plan, or in the
event an Employer is dissolved or liquidated, or in the event judicial
proceedings of any kind result in the involuntary dissolution of an Employer,
the Plan shall be terminated as respects such Employer. The merger,
consolidation or reorganization of an Employer, or the sale by it of all or
substantially all of its assets, shall not terminate the Plan if there is
delivery to such Employer by the successor to such Employer or by the purchaser
of all or substantially all of its assets, a written instrument requesting that
it be substituted for the Employer and agreeing to perform all the provisions
which such Employer is required to perform, a copy of which shall be delivered
to the Trustee. Upon receipt of said instrument, with the approval of the
Sponsor, the successor or the purchaser shall be substituted for such Employer
herein, and such Employer shall be relieved and released from any obligations of
any kind, character or description herein or in any Trust Agreement imposed upon
it.

                                       50
<PAGE>

8.5      RESTRICTIONS ON BENEFITS AND DISTRIBUTIONS TO CERTAIN MEMBERS

(a)      RESTRICTION OF BENEFITS. Notwithstanding any other provisions in the
         Plan to the contrary, in the event of the termination of the Plan, the
         benefit of any Highly Compensated Employee (and any Highly Compensated
         Former Employee) is limited to a benefit that is nondiscriminatory
         under Code Section 401(a)(4). For purposes of this Section 8.5, the
         term "Highly Compensated Former Employee" shall mean any Member who has
         terminated employment as an Employee in a prior Plan Year and who was a
         Highly Compensated Employee either when he terminated employment as an
         Employee or any Plan Year ending on or after his fifty-fifth birthday.

(b)      RESTRICTIONS ON DISTRIBUTIONS. Notwithstanding any other provisions to
         the contrary, the annual benefits provided under the Plan for
         participating Highly Compensated Employees and Highly Compensated
         Former Employees who are among the 25 most highly paid Employees of the
         Employer are restricted to an amount equal to the annual payments that
         would be made on behalf of the Participant under a single life annuity
         that is the Actuarial Equivalent of the sum of such Participant's
         accrued benefit and other benefits under the Plan. In any one year, the
         total number of Members whose benefits are subject to the restriction
         under this Section 8.5(b) shall be limited to the group of the 25
         Highly Compensated Employees and Highly Compensated Former Employees
         who received the greatest compensation. The restrictions of this
         Section 8.5(b) shall not apply, however, if--

         (1)      after payment to such Member of all benefits under the Plan,
                  the value of Plan assets equals or exceeds 110 percent of the
                  value of the current liabilities [defined in Code Section
                  412(l)(7)] of the Plan; or

         (2)      the value of the benefits payable to such Member is less than
                  1 percent of the value of the current liabilities [as defined
                  in Code Section 412(l)(7)] of the Plan.

                                       51
<PAGE>

ARTICLE IX. PARTICIPATION IN AND WITHDRAWAL FROM THE PLAN BY AN EMPLOYER

9.1 PARTICIPATION IN THE PLAN

Any Affiliate of the Sponsor which desires to become an Employer under the Plan
may elect, with the consent of the Board of Directors of the Sponsor, to become
a party to the Plan and Trust Fund by adopting the Plan for the benefit of its
Eligible Employees, effective as of the date specified in such adoption--

(a)      by filing with the Sponsor a certified copy of a resolution of its
         board of directors (or equivalent governing authority) to that effect,
         and such other instruments as the Sponsor may require; and

(b)      by the Sponsor's filing with the Committee and the Trustee a copy of
         such resolution, together with a certified copy of resolutions of the
         Board of Directors of the Sponsor approving such adoption.

The adoption resolution, supplement or instrument may contain such specific
changes and variations in Plan or Trust Agreement terms and provisions
applicable to such adopting Employer and its Eligible Employees as may be
acceptable to such Employer, the Sponsor and the Trustee. However, the sole,
exclusive right to make any amendment of whatever kind or extent to the Plan or
Trust Agreement is reserved by the Sponsor, subject to its right of delegation
under Section 8.1(a). It shall not be necessary for the adopting Employer to
sign or execute the original or then amended Plan and Trust Agreement documents.
The effective date of the Plan for any such adopting Employer shall be that
stated in the adoption resolution or instrument; and from and after such
effective date, such adopting Employer shall assume all the rights, obligations
and liabilities of an Employer under the Plan and Trust Agreement.

The administrative powers and control of the Sponsor, as provided in the Plan
and Trust Agreement, including the sole right of appointment and removal of the
members of the Committee, the Trustee and their successors shall not be
diminished by reason of the participation of any such adopting Employer in the
Plan and Trust Agreement.

9.2 WITHDRAWAL FROM THE PLAN

Any Employer other than the Sponsor, by actions of its board of directors or
other governing body, may elect to withdraw from the Plan and Trust Agreement by
giving 90 days' advance written notice of its election to the Board of Directors
of the Sponsor, unless the Board of Directors of the Sponsor waives such advance
notice or agrees to a shorter advance notice period. Such Employer's election to
withdraw from the Plan and Trust Agreement shall be subject to the consent of
the Board of Directors of the Sponsor. Distributions following such withdrawal
may be implemented through continuation of the Trust Fund or transfer to another
trust fund exempt from tax under Code Section 501 or to a group annuity contract
qualified under Code Section 403 or, subject to Section 8.3, distributions may
be made as immediate distributions in accordance with the directions of the
Committee; provided, however, that no such action shall direct any part of the
Trust Fund relating to the Members of such Employer to

                                       52
<PAGE>

any purpose other than the exclusive benefit of the Members of such Employer, or
the surviving Spouses or Beneficiaries of such Members, prior to the
satisfaction of all benefit liabilities under the Plan with respect to the
Members of such Employer.

                                       53
<PAGE>

ARTICLE X.  MISCELLANEOUS

10.1 NONALIENATION

Except as provided in Code Section 401(a)(13)(A)(B) or (C), no benefit payable
at any time under the Plan shall be subject in any manner to alienation, sale,
transfer, assignment, pledge, attachment, garnishment or encumbrance of any
kind. Any attempt to alienate, sell, transfer, assign, pledge or otherwise
encumber any such benefit, whether presently or hereafter payable, shall be
void. No benefit nor the Trust Fund shall in any manner be liable for or subject
to the debts or liabilities of any Member, surviving Spouse or Beneficiary
entitled to any benefit except as may be provided in a "qualified domestic
relations order" under Code Section 414(p). The Committee shall establish
procedures to determine whether domestic relations orders are "qualified
domestic relations orders" and to administer distributions under such qualified
domestic relations orders.

10.2 INCOMPETENCY

Every person receiving or claiming benefits under the Plan shall be conclusively
presumed to be mentally competent until the date on which the Committee receives
a written notice, in a form and manner acceptable to it, that such person is
incompetent, for whom a guardian or other person legally vested with the care of
his estate has been appointed; provided, however, that if the Committee shall
find that any person to whom a benefit is payable under the Plan is unable to
care for his affairs because of any disability or infirmity, any payment due
(unless a prior claim therefor shall have been made by a duly appointed legal
representative of his estate) may be paid to the spouse, a child, a parent, or a
brother or sister or to any person deemed by the Committee to have incurred
expense for such person otherwise entitled to payment. Any such payment so made
shall be a complete discharge of any liability therefor under the Plan. In the
event a guardian of the estate of any person receiving or claiming benefits
under the Plan shall be appointed by a court of competent jurisdiction, benefit
payments may be made to such guardian, provided that proper proof of appointment
and continuing qualification is furnished in a form and manner acceptable to the
Committee. Any such payment so made shall be a complete discharge of any
liability therefor under the Plan.

10.3 MERGER, CONSOLIDATION OR TRANSFER

In the case of any merger or consolidation of the Plan with, or in the case of
any transfer of assets or liabilities of the Plan to or from, any other plan,
each Member in the Plan shall (if the Plan then terminated) receive a benefit
immediately after the merger, consolidation or transfer which is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation or transfer (if the Plan had then terminated).
To the extent required by Code Section 411(d)(6), the Plan will preserve the
forms of benefits that relate to a Member's benefit that is transferred to this
Plan.

The provisions of this Plan that are adopted in order that the Plan comply with
Section 401(a) of the Code within the time period set forth in Section 401(b) of
the Code are deemed to amend, to the

                                       54
<PAGE>

extent necessary, the corresponding provisions of any prior plan that was
merged, consolidated, or transferred into this Plan.

                                       55
<PAGE>

10.4 LITIGATION

In order to protect the Trust Fund against depletion as a result of litigation,
in the event that any Member or other person may bring any legal or equitable
action arising under the Plan against the Trustee or an Employer or the
Committee, or in the event that an Employer or the Trustee or the Committee may
find it necessary to bring any legal or equitable action arising under the Plan
against any Member or any person claiming any interest by or through such
Member, the Committee shall have the right to join the Trustee as a party
defendant or party plaintiff in any such action, and all expenses of defending
or bringing such action shall be paid by the Trustee from the Trust Fund, to the
extent permitted by ERISA.

10.5 EFFECT OF MISTAKE

In the event of a mistake or misstatement as to the eligibility or participation
of a Member, or the amount of benefit payments made or to be made to or with
respect to a Member, the Committee shall, if possible, cause an adjustment to be
made so as to correct such mistake and provide for the correct amount of benefit
payments with respect to such Member.

10.6 NO ENLARGEMENT OF EMPLOYEE RIGHTS

Nothing contained in the Plan shall be deemed to give any Employee the right to
be retained in the service of an Employer or Affiliate or to interfere with the
right of an Employer or Affiliate to discipline, discharge or retire any
Employee at any time.

10.7 NO GUARANTEE

Neither the Committee, the Sponsor, the Employers nor the Trustee in any way
guarantees the Trust Fund from loss or depreciation nor the payment of any money
which may be or become due to any person from the Trust Fund. Nothing herein
contained shall be deemed to give any Member, surviving Spouse or Beneficiary an
interest in any specific part of the Trust Fund or any other interest except the
right to receive benefits out of the Trust Fund in accordance with the
provisions of the Plan.

10.8 INTERNAL REVENUE SERVICE APPROVAL

It is the intention of the Sponsor to obtain a ruling or rulings by the District
Director of the Internal Revenue Service that--

(a)      the Plan, as in effect from time to time, with respect to the Employer,
         meets the requirements of Code Section 401(a); and

(b)      any and all contributions made by the Employer under the Plan are
         deductible for income tax purposes under Code Section 404(a) or any
         other applicable provisions of the Code.

                                       56
<PAGE>

10.9     EXCLUSIVE BENEFIT; NONREVERSION

The Trust Fund shall be used and applied only in accordance with the provisions
of the Plan and Trust Agreement to provide the benefits provided under the Plan;
and the Employers shall not have any right, title or interest in the assets of
the Trust Fund; and no part of the corpus or income of the Trust Fund shall be
used for or diverted to purposes other than for the exclusive benefit of
Members, surviving Spouses and Beneficiaries and for the payment of the
reasonable expenses of administering the Plan and Trust Fund, except that--

(a)      Upon termination of the Plan with respect to any Employer and the
         allocation and distribution of the Trust Fund as provided herein, any
         funds remaining in the Trust Fund with respect to the Employer because
         of an erroneous actuarial computation after the satisfaction of all
         fixed and contingent benefit liabilities under the Plan with respect to
         that Employer shall revert to such Employer.

(b)      If contributions under the Plan are made to the Trust Fund by an
         Employer by a mistake of fact, then such contributions shall be
         returned to such Employer within one year after the payment of such
         contributions; and if any part or all of the contributions are
         disallowed as a deduction under Code Section 404, then to the extent
         such contributions are disallowed as a deduction they shall be returned
         to such Employer within one year after the disallowance. All
         contributions are conditioned upon the deductibility of the
         contributions under Code Section 404 as provided in Section 7.2 of the
         Plan.

(c)      In the case of a contribution which would otherwise be an excess
         contribution [as defined in Code Section 4979(c)], a correcting
         distribution with respect to such contribution from the Plan to the
         Employer shall be made to the extent permitted in the Code to avoid
         payment of an excise tax on excess contributions under Code Section
         4979(c).

(d)      If the Internal Revenue Service determines that the Plan does not
         initially meet the requirements of Code Section 401 with respect to an
         Employer, the Plan shall be null and void from the effective date of
         the Plan applicable to such Employer; and any contributions shall be
         returned to the Employer within one year following the determination
         that the Plan does not initially meet such requirements, unless the
         Sponsor elects to make the changes to the Plan necessary to receive a
         determination from the Internal Revenue Service that the requirements
         of Code Section 401 are met. Contributions may be returned pursuant to
         this Section 10.9(d) only if the application for the determination of
         Plan qualification is made by the time prescribed by law for filing the
         Employer's return for the taxable year in which the Plan was adopted or
         such later date as the Secretary of Treasury may prescribe.

10.10    APPLICABLE LAW

The Plan and all rights hereunder shall be governed by and construed in
accordance with the laws of the State of Ohio to the extent such laws have not
been preempted by applicable federal law.

                                       57
<PAGE>

10.11    SEVERABILITY

If a provision of the Plan shall be held illegal or invalid, the illegality or
invalidity shall not affect the remaining parts of the Plan and the Plan shall
be construed and enforced as if the illegal or invalid provision had not been
included in the Plan.

10.12    MISTAKES

In the event of a mistake or a misstatement by a Member or Beneficiary as to any
item of information that is furnished pursuant to the terms of the Plan that has
an effect on the amount paid or to be paid to such Member or Beneficiary, or a
mistake by the Plan as to the amount paid or to be paid to a Member or
Beneficiary, the Committee shall take such action as in its judgment will
provide such person with the benefit to which he is properly entitled. The
actions that may be taken by the Committee may include, without limitation, the
reduction of future payments to the Member or Beneficiary, the restatement of
such person's accrued benefit on the books and records of the Committee, a
request to the Member or Beneficiary that such person repay the amounts paid in
error or any other action as the Committee deems desirable.

10.13    QUALIFIED TRANSPORTATION FRINGE PAYMENTS

To the extent that any provision of the Plan directly or indirectly references
the definition of "compensation" set forth in either Section 415(c)(3) or
Section 414(s)(2) of the Code, and such provision provides that certain deferred
compensation pursuant to Section 415(c)(3)(D) of the Code or Section 414(s)(2)
of the Code will be included in the definition of "compensation," then effective
for Plan Years or Limitation Years beginning on and after January 1, 2001, the
amount of compensation determined pursuant to such provision will include
elective amounts that are not includable in the gross income of the Participant
by reason of Section 132(f)(4) of the Code.

                                       58
<PAGE>

ARTICLE XI.  TOP-HEAVY PROVISIONS

11.1     APPLICATION OF TOP-HEAVY PROVISIONS

(a)      SINGLE PLAN DETERMINATION. Except as provided in Section 11.1(b)(2), if
         as of a Determination Date, the sum of the amount of the Code Section
         416 Benefit of Key Employees and the surviving Spouses and
         Beneficiaries of deceased Key Employees exceeds 60 percent of the
         amount of the Code Section 416 Benefits of all Members and their
         surviving Spouses or Beneficiaries (excluding former Key Employees),
         the Plan is top-heavy and the provisions of this Article XI shall
         become applicable.

(b)      AGGREGATION GROUP DETERMINATION.

         (1)      If as of a Determination Date the Plan is part of an
                  Aggregation Group which is top-heavy, the provisions of this
                  Article XI shall become applicable. Top-heaviness for the
                  purpose of this Section 11.1(b)(1) shall be determined with
                  respect to the Aggregation Group in the same manner as
                  described in Section 11.1(a).

         (2)      If the Plan is top-heavy under Section 11.1(a), but the
                  Aggregation Group is not top-heavy, the Plan shall not be
                  top-heavy and this Article XI shall not be applicable.

         (3)      In determining whether the Plan, or any other plan included in
                  a required aggregation group [within the meaning of Code
                  Section 416(g)] is top-heavy, the accrued benefit of any
                  Employee (other than a Key Employee) shall be determined under
                  (A) the accrual method which is used for accrual purposes
                  under all such plans; or (B) if there is no such method, as if
                  such benefit accrued not more rapidly than the slowest rate
                  permitted under Code Section 411(b)(1)(C).

(c)      COMMITTEE. The Committee shall have responsibility to make all
         calculations to determine whether the Plan is top-heavy.

11.2     DEFINITIONS

(a)      "AGGREGATION GROUP" means the Plan and all other plans maintained by
         the Employers and Affiliates which cover a Key Employee and any other
         plan which enables a plan covering a Key Employee to meet the
         requirements of Code Section 401(a)(4) or 410. In addition, at the
         election of the Committee, the Aggregation Group may be expanded to
         include any other qualified plan maintained by an Employer or Affiliate
         if such expanded Aggregation Group meets the requirements of Code
         Sections 401(a)(4) and 410. The Aggregation Group shall include any
         terminated plan if it was maintained within the last five years ending
         on the Determination Date for the Plan Year in question and would, but
         for the fact that it terminated, be described in the preceding sentence
         for such Plan Year.

                                       59
<PAGE>

(b)      "DETERMINATION DATE" means the last day of the Plan Year immediately
         preceding the Plan Year for which top-heaviness is to be determined or,
         in the case of the first Plan Year of a new plan, the last day of such
         Plan Year.

(c)      "KEY EMPLOYEE" means a Member who for the Plan Year containing the
         Determination Date or any of the four preceding Plan Years is--

         (1)      an officer of an Employer or Affiliate who has annual
                  Compensation greater than 50 percent of the amount in effect
                  under Code Section 415(b)(1)(A) for such Plan Year; provided,
                  however, that no more than the lesser of--

                  (A)      50 Employees; or

                  (B)      the greater of (i) three Employees or (ii) 10 percent
                           of all Employees shall be treated as officers, and
                           such officers shall be those with the highest annual
                           Compensation in the five-year period;

         (2)      one of the ten Employees having annual Compensation from all
                  Employers and Affiliates for such Plan Year greater than the
                  dollar limit specified in Code Section 415(c)(1)(A) and
                  owning both more than a one-half of 1 percent interest and
                  the largest interests in an Employer or Affiliate;

         (3)      a 5-percent owner of an Employer or Affiliate; or

         (4)      a 1-percent owner of an Employer or Affiliate having annual
                  Compensation of more than $150,000.

         For purposes of this Section 11.2(c), "Compensation" shall mean
         compensation as defined in Section 2.1(j)(2), plus amounts that would
         otherwise be excluded from the Participant's compensation thereunder by
         reason of the application of Code Sections 125, 402(e)(3), 402(h)(1)(B)
         and amounts that would otherwise be excluded by reason of the
         application of Code Section 403(b) pursuant to a salary reduction
         agreement; provided, however, that Compensation for purposes of this
         Section 11.2(c) shall not exceed the maximum annual compensation limit
         as provided for in Code Section 401(a)(17), as such amount may be
         adjusted or changed from year to year in accordance with the adjustment
         provisions or changes to Code Section 401(a)(17). Ownership shall be
         determined in accordance with Code Section 416(i)(1)(B) and (C). For
         purposes of Section 11.2(c)(2), if two Employees have the same
         ownership interest in an Employer or Affiliate, the Employee having the
         greater annual Compensation from the Employers and Affiliates shall be
         treated as having a larger interest.

(d)      "SECTION 416 BENEFIT" means the sum of--

         (1)      the amount credited as of a Determination Date to a Member's,
                  surviving Spouse's or Beneficiary's account under any
                  qualified defined contribution plan

                                       60
<PAGE>

                  which is part of an Aggregation Group (including amounts to be
                  credited as of the Determination Date but which have not yet
                  been contributed);

         (2)      the present value of the accrued benefit credited as of a
                  Determination Date to a Member, surviving Spouse or
                  Beneficiary under the Plan and any other qualified defined
                  benefit plan which is part of an Aggregation Group; and

         (3)      the amount of distributions to the Member, surviving Spouse or
                  Beneficiary during the five-year period ending on the
                  Determination Date other than a distribution which is a
                  tax-free rollover contribution (or similar transfer) that is
                  not initiated by the Member or that is contributed to a plan
                  which is maintained by an Employer or Affiliate reduced by--

         (4)      the amount of rollover contributions (or similar transfers)
                  and earnings thereon credited as of a Determination Date under
                  a plan forming part of an Aggregation Group which is
                  attributable to a rollover contribution (or similar transfer)
                  accepted after December 31, 1983, initiated by the Member and
                  derived from a plan not maintained by an Employer or
                  Affiliate.

         The account or accrued benefit of a Member who was a Key Employee and
         who subsequently meets none of the conditions of Section 11.2(c) for
         the Plan Year containing the Determination Date is not a Section 416
         Benefit and shall be excluded from all computations under this Article
         XI. Furthermore, if a Member has not performed any service for an
         Employer or Affiliate during the five-year period ending on the
         Determination Date, any accrued benefit of such Member (and any account
         for such Member) shall not be taken into account in computing
         top-heaviness under this Article XI. The present value of the accrued
         benefits shall be determined as of the most recent valuation date used
         for the purposes of Code Section 412 which is within the 12-month
         period ending on the Determination Date. The accrued benefit of a
         current Member shall be determined as if the Member terminated service
         as of such valuation date. For purposes of this Article XI, the
         actuarial assumptions used for determining an Actuarial Equivalent
         benefit shall be used to compute the present value of the accrued
         benefits.

11.3 VESTING REQUIREMENTS

Notwithstanding the vesting formula in Section 4.5(a), if the Plan is determined
to be top-heavy with respect to a Plan Year under the provisions of Section
11.1, then a Member's interest in his accrued benefit shall vest by substituting
"three years of Vesting Service" for "five years of Vesting Service" in
determining a Member's Vested Retirement Age under the Plan.

The vesting provisions described in this Section 11.3 shall not apply to a
Member who does not have an Hour of Service after the Plan becomes top-heavy. If
in a subsequent Plan Year the Plan is no longer top-heavy, the vesting
provisions that were in effect prior to the time the Plan became top-heavy shall
be reinstated; provided, however, that the vesting provisions of this Section
11.3 shall continue to apply in the case of a Member who has at least three
years of Vesting Service at the time of such reinstatement.

                                       61
<PAGE>

11.4     MINIMUM BENEFIT

(a)      MINIMUM ACCRUAL FORMULA. If the Plan is determined to be top-heavy
         under the provisions of Section 11.1 with respect to a Plan Year, the
         accrued benefit, when expressed as an Annual Retirement Benefit (as
         defined below), of a Member who is not a Key Employee and who has
         completed at least 1,000 Hours of Service (or the equivalent) during
         the Plan Year regardless of his level of compensation or whether he is
         employed on a specified date shall not be less than the difference
         between (1) and (2) where--

         (1)      is the product of--

                  (A)      the number of years of Top-Heavy Service (as defined
                           below); and

                  (B)      2 percent of the Member's average Compensation during
                           the period of the five consecutive years of Top-Heavy
                           Service during which the Member had the greatest
                           aggregate Compensation, but such product shall not
                           exceed 20 percent of the average Compensation; and

         (2)      is the amount of the Annual Retirement Benefit that would be
                  provided by the Member's account balance attributable to
                  Employer contributions under a defined contribution plan which
                  is included in an Aggregation Group.

11.5     LIMIT ON ANNUAL ADDITIONS; COMBINED PLAN LIMIT

(a)      GENERAL. This Section 11.5 shall be effective for Limitation Years
         commencing prior to January 1, 2000. If the Plan is determined to be
         top-heavy under Section 11.1, Section 4.11(g) shall be applied by
         substituting "1.0" for "1.25" in applying the provisions of Code
         Section 415(e)(2) and (e)(3).

(b)      EXCEPTION.  Section 11.5(a) above shall not be applicable if--

         (1)      Section 11.4 is applied by substituting "3 percent" for "2
                  percent";

         (2)      Section 11.4 is applied by increasing (but not by more than 10
                  percentage points) "20 percent" by 1 percentage point for each
                  year for which the Plan was taken into account under this
                  Section 11.5; and

         (3)      the Plan would not be top-heavy if "90 percent" is substituted
                  for "60 percent" in Section 11.1.

(c)      TRANSITION RULE. If, but for this Section 11.5, Section 11.5(a) would
         begin to apply with respect to the Plan, the application of Section
         11.5(a) shall be suspended with respect to a Member so long as there
         are--

         (1)      no Employer contributions or forfeitures allocated to such
                  Member; and

                                       62
<PAGE>

         (2)      no accruals under a qualified defined benefit plan for such
                  Member.

11.6 COLLECTIVE BARGAINING AGREEMENTS

The requirements of Sections 11.3 and 11.4 shall not apply with respect to any
Employee included in a unit of employees covered by a collective bargaining
agreement between employee representatives and an Employer or Affiliate if
retirement benefits were the subject of good faith bargaining between such
employee representatives and such Employer or Affiliate.

                                    *********

                                       63
<PAGE>

IN WITNESS WHEREOF, R. G. Barry Corporation has caused this document to be
executed by its duly authorized officers on this 31 day of December, 2001,
effective as of the 1st day of January, 1997, unless otherwise stated herein.

                             R. G. BARRY CORPORATION

                             By: /s/ Harry Miller
                                ------------------------------------------------
                                      Vice-President of Human Resources

                             By: /s/ Daniel D. Viren
                                ------------------------------------------------
                                      Senior Vice-President of
                                      Finance and Treasurer

                             By: /s/ Michael S. Krasnoff
                                ------------------------------------------------
                                      Vice-President of Finance
                                      and Assistant Treasurer

                                       64<PAGE>
                                                                    Exhibit 10.5

                              EMPLOYMENT AGREEMENT

                  This EMPLOYMENT AGREEMENT ("Agreement") is effective this 1st
day of July, 2001, by and between R. G. Barry Corporation, an Ohio corporation
(the "Company"), and Gordon Zacks ("Executive").

                              W I T N E S S E T H:

                  WHEREAS, the Company desires to continue Executive in its
employ and Executive desires to remain in the employ of the Company, holding the
offices of Chairman of the Board and Chief Executive Officer of the Company
(unless Executive agrees to hold a different office), for an extended period in
accordance with the terms and conditions of this Agreement;

                  NOW, THEREFORE, in consideration of the premises and of their
mutual covenants expressed in this Agreement, the parties hereto make the
following agreement, intending to be legally bound hereby:

                  1. Term. The Company hereby agrees to continue Executive in
its employ, and Executive hereby agrees to remain in the employ of the Company,
in accordance with the terms and conditions hereof, for the period commencing on
July 1, 2001 (the "Commencement Date"), and ending on the third anniversary of
the Commencement Date (the "Original Term"), unless sooner terminated as
hereinafter set forth; provided, however, that the term of this Agreement shall
automatically be extended for one additional, one-year term (an "Extended Term")
unless at least 90 days prior to the expiration of the Original Term the Company
or Executive shall give notice to the other that it/he does not wish to extend
the term of this Agreement. The Original Term of Executive's employment under
this Agreement, together with any Extended Term, is hereinafter sometimes
referred to as the "Employment Term." Anything contained in this Agreement to
the contrary notwithstanding, in the event that a Change of Control of the
Company (as defined in Section 9) occurs or is publicly proposed (and such
proposal is not withdrawn) prior to the end of the Employment Term, as defined
in the immediately preceding sentence of this paragraph, the Employment Term
shall be automatically extended for an additional one-year period (an "Extended
Term") commencing on the date on which the Employment Term would otherwise have
terminated pursuant to this paragraph and expiring on the first anniversary of
such date.

<PAGE>

                  2. Position and Duties. (a) During the Employment Term, (i)
Executive shall serve as the Chairman and Chief Executive Officer of the Company
(unless Executive agrees to hold a different office), reporting only to the
Company's Board of Directors (the "Board of Directors" or the "Board") and his
authority, duties and responsibilities shall be at least commensurate in all
material respects with those held, exercised and assigned on the Commencement
Date (unless Executive agrees to different duties and responsibilities) and (ii)
Executive's principal office shall be located in Central Ohio, although he shall
be allowed to travel extensively for the Company as he may determine.

                           (b) Excluding periods of vacation and sick leave to
which Executive is entitled, Executive agrees to devote reasonable attention and
time during normal business hours to the business and affairs of the Company
and, to the extent necessary to discharge the responsibilities assigned to
Executive hereunder, to use Executive's reasonable best efforts to perform
faithfully and efficiently such responsibilities. Executive may (i) serve on
corporate, civic, charitable or political boards or committees, (ii) fulfill
speaking engagements and (iii) manage personal investments, so long as such
activities do not interfere in any material respect with the performance of
Executive's responsibilities hereunder. It is expressly understood and agreed
that, to the extent any such activities shall have been conducted by Executive
prior to the Commencement Date, the continued conduct of such activities or the
conduct of activities similar in nature and scope thereto subsequent to the
Commencement Date shall not, for the purposes of this Agreement, be deemed to
interfere in any material respect with the performance of Executive's
responsibilities hereunder.

                  3. Compensation and Other Benefits. The terms of Executive's
compensation during the Employment Term shall be as follows:

                           (a) BASE SALARY. During the Employment Term,
Executive shall receive a minimum annual base salary of $490,000 (the "Base
Salary"), to be paid in equal installments in accordance with the Company's
normal pay schedule for salaried employees; said Base Salary may be increased at
any time and from time to time by the Company, and the Company shall cause its
Board of Directors or an appropriate committee thereof to review annually the
performance of Executive and the results of operations and financial condition
of the Company, together with prevailing economic conditions and other relevant
factors, to determine whether or not any increase above said minimum annual
salary is appropriate; and the highest rate of salary (on an annualized basis)
paid to Executive by the Company during the

                                     - 2 -
<PAGE>

Employment Term (excluding any bonus) shall be deemed to be the Base Salary for
purposes of this Agreement.

                           (b) BENEFITS. During the Employment Term:

                           (i) The Company, at its sole expense, shall provide
and maintain a policy of insurance on Executive's life from an insurance company
that is reasonably acceptable to Executive providing for a death benefit of at
least $1,000,000, payable to one or more beneficiaries designated by Executive
(or to the beneficiaries designated by Executive's assignee, if any, of such
policy) or, if Executive (or his assignee, if any) fails to so designate a
beneficiary, to Executive's estate; provided, however, that at Executive's
option, the Company shall, in lieu of providing the aforesaid life insurance
policy, pay to Executive for each 12-month period during the Employment Term a
cash payment of $18,000. If the life insurance provided by the Company under
this Section 3(b)(i) is a whole life insurance policy or policies, Executive
shall be entitled to the cash surrender value of such policy or policies and
shall have the right to cause the Company to transfer ownership of such policy
or policies to Executive or his designee.

                           (ii) In addition to the insurance described in
Section 3(b)(i), the Company, at its expense, shall provide and maintain a
split-dollar life insurance policy on Executive's life from an insurance company
reasonably acceptable to Executive providing for a death benefit payable to
Executive's beneficiaries or estate (or to the beneficiaries designated by
Executive's assignee, if any, of his interest under this Section 3(b)(ii)), in
an amount that is not less than $1,310,000, which is the amount of coverage
provided to Executive under that certain split-dollar insurance policy on
Executive's life in effect on the Commencement Date. The Company shall be
obligated to pay the Company's portion of the premiums on such split-dollar
insurance policy and shall pay to or at the direction of Executive a cash bonus
in an amount equal to Executive's (or his assignee's) portion of such insurance
premiums (i.e., the term cost of the life insurance protection under the policy)
plus the amount of Executive's personal income tax liability resulting from the
payment of such cash bonus.

                           (iii) Executive shall be entitled to receive paid
vacation time during each consecutive twelve (12) month period during the
Employment Term in accordance with the vacation policy of the Company for its
senior executives in effect on the Commencement Date.

                           (iv) Executive shall be entitled to receive such
perquisites, fringe benefits and reimbursement of expenses

                                     - 3 -
<PAGE>

historically provided by the Company to its Chairman and Chief Executive
Officer, including, without limitation, the exclusive use of a new luxury
automobile and reimbursement of his initiation fees, dues and assessments at a
country club of his choosing.

                           (v) Executive shall be entitled to participate in the
Company's Salaried Employees' Pension Plan (the "Pension Plan") and Supplemental
Retirement Plan (the "Supplemental Plan"), as any or all of the same may be
amended from time to time, or any substitute or successor plans.

                           (vi) Executive shall be entitled to participate in
the Company's Annual Incentive Plan, as the same may be amended from time to
time, or in any substitute or successor plan, at an annual level ranging between
40% of Base Salary, if Annual Operating Plan targets are met and 100% of Base
Salary, if maximum profit targets are met or exceeded.

                           (vii) Executive shall be eligible to participate in
all benefit, bonus, incentive equity, savings or similar plans or programs
maintained or provided by the Company to its senior executives at a level
commensurate with Executive's title and position ("Bonus Plans"). However:

                           (a) Participation in the Bonus Plans will be
conditioned upon the terms and conditions included in the Bonus Plans; and

                           (b) Nothing in this Agreement will preclude the
Company from amending or terminating any of the Bonus Plans (or adopting new
plans or programs) but without Executive's prior written consent, no amendment
or termination of any Bonus Plan will reduce any benefit that Executive accrued
to the date of that amendment or termination.

                           (viii) Executive shall be entitled to receive all
other employee benefits, including, without limitation, medical, dental, group
life (to the extent the coverage is superior to that provided for in Section
3(b)(i) above) and accidental death insurance benefits as are or in the future
may be provided by the Company to its senior executives.

                           (ix) The Board of Directors of the Company will
consider annually whether additional benefits should be provided to Executive,
including, without limitation, the grant of additional shares of restricted
stock of the Company, stock options or the implementation of other stock-based
incentive plans.

                                     - 4 -
<PAGE>

                  4. Non-Exclusivity of Rights. Nothing in this Agreement shall
prevent or limit Executive's continuing or future participation in any benefit,
bonus, incentive or other plan or program provided by the Company and for which
Executive may qualify, nor shall anything herein limit or otherwise affect such
rights as Executive may have under any stock option or other agreements with the
Company. Amounts which are vested benefits or which Executive is otherwise
entitled to receive under any plan or program of the Company at or subsequent to
the Date of Termination (as defined in Section 5 hereof) shall be payable in
accordance with such plan or program.

                  5. Termination. (a) DEATH OR DISABILITY. Executive's
employment shall terminate automatically upon Executive's death. The Company may
terminate Executive's employment under this Agreement after having established
Executive's Disability (pursuant to the definition of "Disability" set forth
below), by giving to Executive written notice of its intention to terminate
Executive's employment hereunder. In such a case, Executive's employment
hereunder shall terminate effective on the 30th day after receipt of such notice
(the "Disability Effective Date"), provided that within such 30-day period,
Executive shall not have returned to full-time performance of his duties. For
purposes of this Agreement, "Disability" means a disability, which, after the
expiration of more than 6 months after its commencement, is determined to be
total and permanent by a physician selected by the Company or its insurers and
reasonably acceptable to Executive or Executive's legal representative.

                           (b) CAUSE. The Company may terminate Executive's
employment for "Cause." For purposes of this Agreement, termination of
employment for the following reasons (and no other reason) shall constitute
"Cause": (i) gross negligence materially detrimental to the Company, (ii)
conviction of a felony, (iii) willful, and continued failure of Executive, after
receipt of written notice from the Company setting forth the specifics of such
failure, to perform the duties of his offices with the Company unless such
failure is the result of ill health or physical or mental disability or (iv)
intentional misconduct of Executive materially and demonstrably injurious to the
Company.

                           (c) GOOD REASON. Executive's employment may be
terminated by Executive for Good Reason. For purposes of this Agreement, "Good
Reason" means:

                                    (i) (A) The assignment to Executive of any
duties inconsistent in any respect with Executive's position (including, without
limitation, his status, office and title), authority, duties or responsibilities
as contemplated by Section

                                     - 5 -
<PAGE>

2 of this Agreement or (B) any other action by the Company which results in a
material diminution in such position, authority, duties or responsibilities,
other than an insubstantial and inadvertent action which is remedied by the
Company promptly after receipt of notice thereof given by Executive;

                                    (ii) Any reduction in Executive's Base
Salary or any material reduction in the extent of Executive's participation in
the plans referred to in Section 3 hereof or the extent of Executive's
entitlement to the employee benefits, expenses, fringe benefits or prerequisites
referred to in Section 3;

                                    (iii) The assignment of Executive without
his consent to a Company office located beyond a radius of 50 miles from the
Company's principal office on the Commencement Date;

                                    (iv) Failure to nominate or renominate
Executive to the Board of Directors of the Company; or

                                    (v) Any other failure by the Company to
comply with any provision of this Agreement, other than an insubstantial and
inadvertent failure which is remedied by the Company promptly after receipt of
notice thereof given by Executive.

                  For purposes of this Section 5(c) any good faith determination
of "Good Reason" made by Executive shall be conclusive. In addition, for
purposes of this Agreement, a reduction of the kind described in clause (ii) of
this Section 5(c) shall be deemed to be an "Impermissible Reduction."

                           (d) NOTICE OF TERMINATION. Any termination of
Executive's employment hereunder by the Company or by Executive shall be
communicated by Notice of Termination to the other party hereto given in
accordance with Section 16 of this Agreement. For purposes of this Agreement, a
"Notice of Termination" means a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provision so indicated and (iii)
if the Date of Termination (as defined below) is other than the date of receipt
of such notice, specifies the termination date.

                           (e) DATE OF TERMINATION. The term "Date of
Termination," as used in this Agreement, means the date of receipt of the Notice
of Termination or any later date specified therein (which date shall be not more
than 15 days after the

                                     - 6 -
<PAGE>

giving of such notice), as the case may be. If Executive's employment is
terminated by the Company other than for Cause or Disability, the Date of
Termination shall be the date on which the Company notifies Executive of such
termination.

                  6. Compensation Upon Termination of Employment or During
Disability. (a) DEATH. If Executive's employment shall be terminated by reason
of his death, the Company shall promptly make all payments which Executive's
spouse, beneficiaries or estate may be entitled to receive pursuant to any
pension or employee benefit plan, or life insurance policy maintained by the
Company. If the policy of life insurance described in Section 3(b)(ii) is not in
force at the time of Executive's death for any reason, the Company shall
continue to pay Executive's full Base Salary at the rate in effect on the date
of his death on a monthly basis for a period of 60 months following Executive's
date of death to such person or persons as he shall have designated to the
Company or, if no such person or persons shall have been designated, to his
estate. In addition, if Executive's employment shall be terminated by reason of
his death, the Company shall promptly or provide to the person or persons
described in the first sentence of this Section 6 the following:

                           (i) Any unpaid installments of his Base Salary,
calculated to the end of the payroll period during which he terminates
employment because of death;

                           (ii) The value of any accrued but unused vacation,
calculated to the end of the payroll period during which he terminates
employment because of death (this value will be calculated by dividing the Base
Salary by 365 and then multiplying this dollar amount by the number of accrued
but unused vacation days);

                           (iii) The unpaid portion of any bonus that has been
earned and declared under the Company's Annual Incentive Program (or any
successor program) for the most recently completed fiscal year;

                           (iv) A prorated portion of the bonus that would have
been paid to Executive under the Company's Annual Incentive Program (or any
successor program) for the fiscal year during which he dies. This amount will be
calculated and paid after the end of the fiscal year in which Executive dies and
will be determined by multiplying the amount of the bonus Executive would have
received under the Annual Incentive Program if he had continued active
employment until the end of the fiscal year during which he dies by the number
of full calendar months he was actively employed during that fiscal year and
then dividing this dollar amount by 12 months;

                                     - 7 -
<PAGE>

                           (v) Continuation, for a period of six calendar months
beginning on or immediately after the date he dies, of the medical, dental,
prescription drug and hospitalization coverage and benefits for which Executive
and/or his dependents were eligible before his death (the cost of these
continued benefits will be allocated between Executive and the Company in the
same manner it was allocated before Executive's death).

                           (b) DISABILITY. During any period during the
Employment Term that Executive fails to perform his duties hereunder as a result
of incapacity due to ill health or physical or mental disability ("Disability
Period"), Executive shall continue to receive the Base Salary for such period
until his employment is terminated for Disability pursuant to Section 5(a),
provided that payments of Base Salary shall be reduced by the sum of the
amounts, if any, payable to Executive at or prior to the time of any such Base
Salary payment under disability benefit plans of the Company and which were not
previously applied to reduce any payment of Base Salary. If Executive's
employment is terminated by reason of Executive's Disability, Executive shall
continue to receive after the Disability Effective Date his full Base Salary at
the rate then in effect under this Agreement (less any sums payable to Executive
under any disability benefit plan maintained by the Company) until the longer of
the end of the Original Term or six months. Such payments shall not be offset by
Social Security payments, if any. In addition, after any such termination of
employment for Disability, Executive (or, if applicable, his spouse,
beneficiaries or estate) shall receive all amounts to which any of them may be
entitled under any pension, deferred compensation plan or employee benefit plan
maintained by the Company or under any other agreement (said amounts to be paid
in accordance with the terms of any such plan or agreement). In addition, if
Executive's employment shall be terminated by reason of Executive's Disability,
the Company shall, promptly after the Disability Effective Date, pay or provide
to Executive and, if appropriate, his dependents, the following:

                           (i) Any unpaid installments of his Base Salary,
calculated to the end of the payroll period in which employment terminates
because of Disability;

                           (ii) The value of any accrued but unused vacation,
calculated to the end of the payroll period in which employment terminates
because of Disability (this value will be calculated by dividing the Base Salary
by 365 and then multiplying this dollar amount by the number of accrued but
unused vacation days);

                                     - 8 -
<PAGE>

                           (iii) The unpaid portion of any bonus that has been
earned and declared under the Company's Annual Incentive Program (or any
successor plan) for the most recently completed fiscal year; and

                           (iv) A prorated portion of the bonus that would have
been paid to Executive under the Company's Annual Incentive Program (or any
successor plan) for the fiscal year during which the Disability Effective Date
occurs. This amount will be calculated and paid after the end of the fiscal year
in which the Disability Effective Date occurs and will be determined by
multiplying the amount of the bonus Executive would have received under the
Annual Incentive Program (or any successor plan) if he had continued active
employment until the end of the fiscal year during which the Disability
Effective Date occurs by the number of full calendar months he was actively
employed during that fiscal year and then dividing this dollar amount by 12
months.

                           (c) WITH CAUSE OR WITHOUT A GOOD REASON. If, during
the Employment Term, Executive's employment shall be terminated by the Company
for Cause or by Executive without Good Reason, the Company shall pay to
Executive the amounts described in clauses (i) through (iv) below, and the
Company shall have no further obligation to Executive under this Agreement:

                           (i) Any unpaid installments of his Base Salary,
calculated to the end of the payroll period during which the Date of Termination
occurs;

                           (ii) The value of any accrued but unused vacation,
calculated to the end of the payroll period during which the Date of Termination
occurs (this value will be calculated by dividing the Base Salary by 365 and
then multiplying this dollar amount by the number of accrued but unused vacation
days);

                           (iii) Any amounts Executive is entitled to receive
under the terms of any employee benefit plan, including any pension or deferred
compensation plan or program; and

                           (iv) The unpaid portion of any bonus that has been
earned and declared under the Company's Annual Incentive Program (or any
successor plan) for the most recently completed fiscal year.

                           (d) WITHOUT CAUSE OR FOR GOOD REASON AFTER A CHANGE
OF CONTROL. If, during the Employment Term and following a Change of Control (as
defined in Section 9 of this Agreement), the Company shall terminate Executive's
employment other than for

                                     - 9 -
<PAGE>

Cause or Disability, or the employment of Executive shall be terminated by
Executive for Good Reason:

                                    (i) The Company shall pay to Executive in a
lump sum in cash within 10 days after the Date of Termination the aggregate of
the following amounts:

                                             (A) If not theretofore paid,
Executive's Base Salary through the Date of Termination at the rate in effect on
the Date of Termination;

                                             (B) The value of any accrued but
unused vacation, calculated to the end of the payroll period during which the
Date of Termination occurs (this value will be calculated by dividing the Base
Salary by 365 and then multiplying this dollar amount by the number of accrued
but unused vacation days);

                                             (C) The unpaid portion of any bonus
that has been earned and declared under the Company's Annual Incentive Program
(or any successor program) for the most recently completed fiscal year before
Executive's termination of employment occurs under this section;

                                             (D) An amount equal to three times
the then current Base Salary;

                                             (E) An amount equal to three times
the average of the annual bonuses, if any, Executive received during the five
fiscal years ending before Executive's termination of employment occurs under
this section (or, if less than five, the number of years in which Executive
received a bonus during such past five fiscal years); and

                                             (F) In the case of compensation
previously deferred by Executive, all amounts of such compensation previously
deferred and not yet paid by the Company, together with all interest accrued
thereon.

                                    (ii) The Company shall, promptly upon
submission by Executive of supporting documentation, pay or reimburse to
Executive all costs and expenses paid or incurred by Executive which would have
been payable under Section 3(b) hereof if Executive's employment had not been
terminated.

                                    (iii) For a period ending on Executive's
85th birthday, or until his earlier death, the Company, at its cost, shall
maintain in full force and effect, for the continued benefit of Executive and
Executive's spouse, all life, medical and dental insurance to which Executive
and/or his spouse was

                                     - 10 -
<PAGE>

entitled immediately prior to the Date of Termination less any such benefits
provided to them by Medicare or similar government-funded health insurance;
provided that, in the event the participation by Executive or his spouse in any
Company employee benefit program that provides such life, medical and dental
benefits is not possible under the terms of such program, the Company, at its
cost, shall arrange to provide Executive and his spouse with benefits
substantially similar to those which they were entitled to receive under any
such program immediately prior to the Date of Termination (less any such
benefits provided to them by Medicare or similar government-funded health
insurance). In addition, the Company shall maintain the life insurance benefits
described in Sections 3(b)(i) and 3(b)(ii) beyond Executive's 85th birthday for
so long as the Company can do so without additional premium costs.

                                    (iv) Executive shall be entitled to all
other benefits to which he is entitled under the terms of any employee benefit
plan or program;

                                    (v) All stock option held by Executive which
were not fully exercisable on the Date of Termination shall immediately become
fully exercisable by Executive.

                                    (vi) All restricted stock of the Company
held by Executive shall become fully vested.

                                    (vii) All of Executive's executive
perquisites immediately prior to the Date of Termination shall continue for
three years after the Date of Termination (except for perquisites that are
specifically addressed by other sections of this Agreement, which other sections
shall control.)

                                    After the Date of Termination, Executive
shall have no obligation to seek other employment, but shall have the right to
be otherwise employed, and any compensation of any type whatsoever received by
Executive in connection with such employment shall not be offset by the Company
against any of the obligations of the Company under this Section 6(d).

                           (e) WITHOUT CAUSE OR FOR GOOD REASON PRIOR TO A
CHANGE OF CONTROL. If, during the Employment Term and prior to a Change of
Control, the employment of Executive shall be terminated by the Company for any
reason other than for Cause or Disability, or the employment of Executive shall
be terminated by Executive for Good Reason, and Section 6(d) of this Agreement
shall not be applicable:

                                     - 11 -
<PAGE>

                                    (i) The Company shall pay to Executive in a
lump sum in cash within 10 days after the Date of Termination the aggregate of
the following amounts:

                                             (A) If not theretofore paid,
Executive's Base Salary through the Date of Termination at the rate in effect on
the Date of Termination;

                                             (B) The value of any accrued but
unused vacation, calculated to the end of the payroll period during which the
Date of Termination occurs (this value will be calculated by dividing the Base
Salary by 365 and then multiplying this dollar amount by the number of accrued
but unused vacation days);

                                             (C) The unpaid portion of any bonus
that has been earned and declared under the Company's Annual Incentive Program
(or any successor plan) for the most recently completed fiscal year before
Executive's termination occurs under this section; and

                                             (D) In the case of compensation
previously deferred by Executive, all amounts of such compensation previously
deferred and not yet paid by the Company together with all interest accrued
thereon.

                                    (ii) Until the longer of the remainder of
the Employment Term (as in effect immediately prior to the termination of
employment) or 18 months, the Company shall continue to pay Executive his Base
Salary on a monthly basis at the rate in effect immediately prior to the Date of
Termination, plus an additional monthly payment equal to one-twelfth of the
Average Bonus (as defined in Section 6(f)).

                                    (iii) The Company shall, promptly upon
submission by Executive of supporting documentation, pay or reimburse to
Executive all costs and expenses paid or incurred by Executive which would have
been payable under Section 3(b) hereof if Executive's employment had not
terminated.

                                    (iv) All stock options held by Executive
which were not fully exercisable on the Date of Termination shall immediately
become fully exercisable by Executive.

                                    (v) All restricted stock of the Company held
by Executive shall become fully vested.

                                    (vi) For a period ending on Executive's 75h
birthday, or until his earlier death, the Company, at its cost, shall maintain
in full force and effect, for the continued

                                     - 12 -
<PAGE>

benefit of Executive and Executive's spouse, all life, medical and dental
insurance benefits to which Executive and his spouse were entitled immediately
prior to the Date of Termination (less any such benefits provided to them by
Medicare or similar government funded health insurance); provided that, in the
event the participation by Executive or his spouse in any Company employee
benefit program that provides such life, medical and dental benefits is not
possible under the terms of such program, the Company, at its cost, shall
arrange to provide Executive and his spouse with benefits substantially similar
to those which they were entitled to receive under any such program immediately
prior to the Date of Termination (less any such benefits provided to them by
Medicare or similar government funded health insurance). In addition, the
Company shall maintain the life insurance benefits described in Sections 3(b)(i)
and 3(b)(ii) beyond Executive's 75th birthday for so long as the Company can do
so without additional premium costs.

                                     (vii) Executive shall be entitled to all
other benefits to which he is entitled under the terms of any employee benefit
plan or program.

                                     After the Date of Termination, Executive
shall have no obligation to seek other employment, but shall have the right to
be otherwise employed, and any compensation of any type whatsoever received by
Executive in connection with such employment shall not be offset by the Company
against any of the obligations of the Company under this Section 6(e).

                           (f) For purposes of this Section 6, the "Average
Bonus" is the average annual bonus paid to Executive for the last three full
fiscal years ending prior to the Date of Termination.

                           (g) Anything in this Section 6 to the contrary
notwithstanding, for purposes of calculating any amount payable to or for the
benefit of the Executive and/or his family pursuant to Section 6, the effect of
any Impermissible Reduction in amounts payable pursuant to Section 5 shall be
disregarded.

                           (h) Regardless of any other provision of this
Agreement, all amounts paid under this Section 6 will be reduced by any amounts
payable to Executive from any other broad based severance plan or program (other
than any plan or arrangement adopted in connection with a Change in Control) or
disability program in which Executive participates (other than a disability
plan, program or policy purchased directly by Executive from his personal
funds).

                  7. Full Settlement. The Company's obligation to make the
payments provided for in this Agreement and otherwise to

                                     - 13 -
<PAGE>

perform its obligations hereunder shall not be affected by any circumstances,
including, without limitation, any set-off, counterclaim, recoupment, defense or
other right which the Company may have against Executive or others. In no event
shall Executive be obligated to seek other employment by way of mitigation of
the amounts payable to Executive under any of the provisions of this Agreement.
Company agrees to pay, to the full extent permitted by law, all legal fees and
expenses which Executive may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof, plus interest, compounded quarterly, on the
total unpaid amount determined to be payable under this Agreement, such interest
to be calculated at a rate equal to 2% in excess of the prime commercial lending
rate announced by The Huntington National Bank, Columbus, Ohio, or its
successor, in effect from time to time during the period of such nonpayment.

                  8. Certain Reduction of Payments by the Company.
Notwithstanding any other provisions in this Agreement or any other agreement,
plan or arrangement, if the sum of the payments and benefits received or to be
received by Executive, whether under the terms of this Agreement or any other
agreement, plan or arrangement with the Company or an affiliate of the Company
(all such payments and benefits being hereinafter referred to as "Total
Payments") constitute "excess parachute payments" as defined in Section
280G(b)(1) of the Internal Revenue Code of 1986, as amended (the "Code"), the
Company will either:

                           (a) Reimburse Executive for the amount of any excise
tax due under Code ss.4999 on the Total Payments (but not on any amount payable
solely under this subsection 8(a)), if this procedure provides Executive with an
after-tax amount that is larger than the after-tax amount produced under Section
8(b); or

                           (b) Reduce the Total Payments (in the manner provided
for in Section 8(c)) so that his total "parachute payment" as defined in Code
ss.280G(b)(2)(A) under this and all other agreements, plans and arrangements
will be $1.00 less than the amount that would be an "excess parachute payment,"
if this procedure provides Executive with an after-tax amount that is larger
than the after-tax amount produced under Section 8(a).

                           (c) Any reduction in the Total Payments in accordance
with this Section 8 shall be made in the following order (unless otherwise
directed by Executive):

                                    (i) The cash payments provided for in
Section 6(d)(i) shall first be reduced (if necessary, to zero);

                                     - 14 -
<PAGE>

                                    (ii) The benefits (or calculated value
thereof) under Subsection 6(d)(iii) shall next be reduced (if necessary, to
zero);

                                    (iii) The benefits described in Subsections
6(d)(v), (vi) and (vii) shall next be reduced; and

                                    (iv) Any additional termination payments or
benefits provided outside this Agreement shall then be reduced as necessary.

                  No inference shall be drawn, however, that any of the payments
described in clauses (i) through (iv) above constitute "parachute payments"
under Section 280G of the Code.

                  9. Change of Control. For purposes of this Agreement, a
"Change of Control" shall be deemed to have occurred if:

                           (a) Any individual (other than Executive), firm,
corporation, partnership, joint venture or other entity or any group (as the
term "group" is defined in Section 13(d)(3) of the Securities Exchange Act of
1934 (the "Exchange Act") and the rules thereunder on the Commencement Date),
other than any such entity or group in respect of which Executive is a
participant, shall hereafter acquire (or disclose the previous acquisition of)
beneficial ownership (as that term is defined in Section 13(d) of the Exchange
Act and the rules thereunder on the Commencement Date) of shares of the
outstanding stock of any class or classes of the Company which results in such
person, firm, corporation, partnership, joint venture, other entity or group
possessing more than a majority of the total voting power of the Company's
outstanding voting securities ordinarily having the right to vote for the
election of directors of the Company; or

                           (b) As the result of, or in connection with, any
tender or exchange offer, merger or other business combination, sale of assets
or contested election of directors, or any combination of the foregoing
transactions ("Transaction"), the persons who were directors of the Company
immediately before the Transaction shall cease to constitute a majority of the
Board of Directors of the Company or any successor to the Company; or

                           (c) If the Board at any time declares that one or
more events have occurred or are likely to occur which, in their sole
determination, create or pose the threat of a Change of Control and which, for
that reason, make it desirable and in the best interests of the Company to
invoke those provisions of this Agreement which become effective on or after the
occurrence of a

                                     - 15 -
<PAGE>

Change of Control; provided, however, that no director of the Company who is
party to this Agreement or an agreement with the Company similar to this
Agreement may participate in considering or voting upon any such resolution; or

                           (d) Any acquisition, merger, consolidation or other
business combination occurs in which the Company's shareholders (determined
immediately before the merger, consolidation or other business combination) do
not own at least 51 percent of the equity interest of the surviving entity
(measured immediately after the transaction); or

                           (e) There occurs a complete liquidation of the
Company or approval by the Company's shareholders of a plan of liquidation or
dissolution.

                  10. Nomination to Board. During the Employment Term, the
Company shall cause Executive to be nominated to membership on the Board of
Directors of the Company in all applicable proxy solicitations made to
shareholders.

                  11. Confidential Information. Executive shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its affiliated
companies, and their respective businesses, which shall have been obtained by
Executive during Executive's employment by the Company or any of its affiliated
companies and which shall not be public knowledge (other than by acts by
Executive or his representatives in violation of this Agreement). After
termination of Executive's employment with the Company, Executive shall not,
without the prior written consent of the Company, or unless required to do so by
order of a court, communicate or divulge any such information, knowledge or data
to anyone other than the Company and those designated by it. In no event shall
an asserted violation of the provisions of this Section 11 constitute a basis
for deferring or withholding any amounts otherwise payable to Executive under
this Agreement.

                  12. Agreement Not to Compete. Executive agrees that during the
Employment Term and for a period of two (2) years thereafter (five (5) years
thereafter if Executive's employment terminates under the circumstances
described in Section 6(d)), he will not, without the consent of the Company's
Board of Directors, serve on the board of directors of any corporation or other
entity that is in competition with the Company or any affiliate of the Company,
nor allow the use of his name with respect to any such corporation or entity,
nor serve as an officer, employee, consultant, representative or otherwise or
have a substantial investment in any such corporation or entity. In no event
shall any asserted violation of the provisions of

                                     - 16 -
<PAGE>

this Section 12 constitute a basis for deferring or withholding any amounts
otherwise payable to Executive under this Agreement.

                  13. Retirement Benefits. In addition to any retirement
benefits to which Executive is entitled under any pension plan or other plan or
program provided by the Company and for which Executive may qualify and in
addition to any termination benefits or payments provided for in this Agreement,
upon any termination of Executive's employment with the Company (other than
termination for Cause), whether such termination occurs during or after the
Employment Term, the Company shall provide Executive the following retirement
benefits:

                           (a) The Company shall continue the life insurance
benefits described in Sections 3(b)(i) and 3(b)(ii) until Executive has attained
the age of 75 or for such longer period as the Company can maintain such
insurance without additional premium costs;

                           (b) For a period ending on Executive's 75th birthday
(85th birthday if Executive's termination of employment occurs following a
Change of Control), or until his earlier death, the Company, as its cost, shall
maintain in full force and effect, for the continued benefit of Executive and
Executive's spouse, all medical and dental insurance benefits to which Executive
and his spouse were entitled immediately prior to the date of termination of
Executives employment with the Company (less any such benefits provided to them
by Medicare or similar government funded health insurance); provided that, in
the event the participation by Executive or his spouse in any Company employee
benefit program that provides such medical and dental benefits is not possible
under the terms of such program, the Company, at its cost, shall arrange to
provide Executive and his spouse with benefits substantially similar to those
which they were entitled to receive under any such program immediately prior to
the Date of Termination (less any such benefits provided to them by Medicare or
similar government funded health insurance).

                           (c) For a period of five years following the date of
termination of Executive's employment with the Company (other than termination
for Disability), the Company shall make available to Executive, at the Company's
expense, Class A office space suitable for Executive at the Company's
headquarters in Pickerington, Ohio, or at a different location selected by the
Company and Executive within 10 miles of Executive's principal residence in
Ohio; and

                           (d) For a period of one year following the date of
termination of Executive's employment with the Company (other than termination
for Disability), the Company, at its cost, will

                                     - 17 -
<PAGE>

make available to Executive a full-time secretary, at the location described
in Section 13(b) above.

                  14. Arbitration. Any controversy or claim arising out of or
relating to this Agreement, or the breach thereof, shall be submitted to
arbitration by the American Arbitration Association in Columbus, Ohio, and the
determination of such arbitration shall be final and absolute. The arbitration
and the panel of three arbitrators shall be governed by the duly promulgated
Commercial Arbitration Rules of the American Arbitration Association and the
pertinent provisions of the laws of the State of Ohio relating to arbitration.
Any judgment upon the award rendered by the arbitrators may be entered in any
court having jurisdiction thereof. Compensation and benefits provided hereunder
shall continue while any proceeding entered into pursuant to this section is in
progress. Unless prohibited by law, arbitration and legal fees regarding
disputes or controversies arising under this Agreement shall be borne by the
Company.

                  15. Successors; Binding Agreement. (a) The Company shall
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company, by agreement in form and substance reasonably
satisfactory to Executive, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no succession had taken place. Failure of the Company
to obtain such agreement prior to the effectiveness of any such succession shall
be a breach of this Agreement and shall entitle Executive to compensation and
benefits and other rights in the same amount and on the same terms as he would
be entitled hereunder if he had terminated his employment for Good Reason
immediately after a Change of Control, except that for purposes of implementing
the foregoing, the date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement, "Company" shall mean
the Company as defined above and any successor to its business and/or assets as
aforesaid which executes and delivers the agreement provided for in this Section
15 or which otherwise becomes bound by the terms and provisions of this
Agreement by operation of law.

                           (b) This Agreement shall inure to the benefit of and
be enforceable by Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
Executive should die while any amounts would still be payable to him hereunder
if he had continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of

                                     - 18 -
<PAGE>

this Agreement to his devisee, legatee or other designee or, if there be no
such designee, to his estate.

                  16. Notices. All notices, requests, demands, and other
communications required or permitted under this Agreement shall be deemed to
have been given if delivered by hand to the address of the recipient or mailed
by first-class certified mail return receipt requested, to the party at the
following addresses:

         If to Executive:    Gordon Zacks
                             XXXXXXXXXXXXXXXXXX
                             XXXXXXXXXXXXXXXXXX

         If to the Company:  R. G. Barry Corporation
                             13405 Yarmouth Rd., N. W.
                             Pickerington, Ohio 43147
                             Attention: Chair of
                                        Compensation Committee

Either party to this Agreement may, by notice given in accordance with this
paragraph, designate a new address for notices, requests, demands and other
communications to such party.

                  17. Miscellaneous. (a) This Agreement shall be governed by and
construed in accordance with the laws of the State of Ohio, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. This Agreement may not
be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.

                           (b) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.

                           (c) The Company may withhold from any amounts payable
under this Agreement such federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.

                           (d) This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

                           (e) This Agreement supersedes any prior agreements or
understandings, oral or written, between Executive and the Company, with respect
to the subject matter described in

                                     - 19 -
<PAGE>

this Agreement and constitutes the entire agreement of the parties with
respect to any matter covered in this Agreement.

                           (f) If any provision or portion of this Agreement is
determined to be invalid or unenforceable for any reason, the remaining
provisions of this Agreement will remain in full force and effect.

                           (g) The Company will withhold from any benefits
payable under this Agreement all federal, state, city or other taxes as required
by any applicable law or governmental regulation or ruling.

                           (h) Failure to insist upon strict compliance with any
of the terms, covenants or conditions described in this Agreement will not
constitute a waiver of that or any other term, covenant or condition nor will
any such failure constitute a waiver or relinquishment of the party's right to
insist subsequently on strict compliance of the affected (and all other) terms,
covenants or conditions of this Agreement.

                  IN WITNESS WHEREOF, this Agreement has been duly executed on
behalf of the Company by an officer duly authorized in the premises and by
Executive on the date first above written.

EXECUTIVE:                                  COMPANY:

                                            R. G. BARRY CORPORATION

/s/ Gordon Zacks  6/20/2001                 By: /s/ Daniel D. Viren  6/20/2001
----------------------------                   --------------------------------
Gordon Zacks                                    Daniel D. Viren, Senior Vice
                                                President-Finance, Chief
                                                Financial Officer, Secretary
                                                and Treasurer

                                     - 20 -

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