Document:

<PAGE>

                                                                    Exhibit 10.7

                     ROTECH HEALTHCARE INC. EMPLOYEES PLAN

                            Effective March 26, 2002

<PAGE>

                                TABLE OF CONTENTS

Article I      Definitions

Article II     Participation

Article III    Contributions

Article IV     Trust Fund

Article V      Members' Accounts

Article VI     Retirement and Death Benefits

Article VII    Vesting and Separation Benefits

Article VIII   Plan Administrator, Committee and Trustee

Article IX     Amendment of the Plan

Article X      Termination of Plan

Article XI     Miscellaneous Provisions

Article XII    Top-Heavy Provisions

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                Page

<S>                                                                               <C>
ARTICLE I      Definitions........................................................2
   Section 1.01    Affiliated Entity..............................................2
   Section 1.02    Annual Compensation............................................2
   Section 1.03    Beneficiary....................................................2
   Section 1.04    Board..........................................................2
   Section 1.05    Change in Control..............................................2
   Section 1.06    Code...........................................................3
   Section 1.07    Committee......................................................3
   Section 1.08    Company........................................................3
   Section 1.09    Company Stock..................................................3
   Section 1.10    Deferred Retirement Date.......................................3
   Section 1.11    Direct Rollover................................................4
   Section 1.12    Distributee....................................................4
   Section 1.13    Effective Date ................................................4
   Section 1.14    Eligible Employee..............................................4
   Section 1.15    Eligible Rollover Distribution.................................4
   Section 1.16    Eligible Retirement Plan.......................................4
   Section 1.17    Employee.......................................................4
   Section 1.18    Employer.......................................................5
   Section 1.19    Employer Contributions.........................................5
   Section 1.20    Employment Commencement Date...................................5
   Section 1.21    Entry Date.....................................................5
   Section 1.22    ERISA..........................................................5
   Section 1.23    Exchange Act...................................................5
   Section 1.24    Hour of Service................................................5
   Section 1.25    Individual Account.............................................6
   Section 1.26    Leased Employee................................................6
   Section 1.27    Member.........................................................7
   Section 1.28    Named Fiduciary................................................7
   Section 1.29    Normal Retirement Date.........................................7
</TABLE>

                                       i

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                Page
<S>                                                                              <C>
   Section 1.30    One-Year Break in Service......................................7
   Section 1.31    Person.........................................................7
   Section 1.32    Plan...........................................................7
   Section 1.33    Plan Administrator.............................................7
   Section 1.34    Plan Year......................................................8
   Section 1.35    Plans..........................................................8
   Section 1.36    Separation from Service........................................8
   Section 1.37    Spousal Consent................................................8
   Section 1.38    Spouse.........................................................8
   Section 1.39    Trust Agreement................................................8
   Section 1.40    Trustee........................................................8
   Section 1.41    Trust Fund.....................................................8
   Section 1.42    Validation Date................................................8
   Section 1.43    USERRA.........................................................8
   Section 1.44    Year of Service................................................8
ARTICLE II     Participation.....................................................10
   Section 2.01    Eligibility...................................................10
   Section 2.02    Reemployed Member.............................................10
   Section 2.03    Enrollment....................................................10
ARTICLE III    Contributions.....................................................11
   Section 3.01    Employer Contributions........................................11
   Section 3.02    Allocations...................................................11
   Section 3.03    Maximum Annual Additions......................................11
   Section 3.04    USERRA........................................................12
ARTICLE IV     Trust Fund........................................................13
   Section 4.01    General.......................................................13
ARTICLE V      Members' Accounts.................................................14
   Section 5.01    Individual Accounts...........................................14
   Section 5.02    Valuation.....................................................14
   Section 5.03    Termination of Participation in Trust Fund....................14
</TABLE>

                                       ii

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                Page
<S>                                                                              <C>
ARTICLE VI     Retirement and Death Benefits.....................................15
   Section 6.01    Normal Retirement.............................................15
   Section 6.02    Retirement After Normal Retirement Date.......................15
   Section 6.03    Death of Member...............................................15
   Section 6.04    Time for Payment of Benefits and Valuation....................15
   Section 6.05    Designation of Beneficiary....................................16
   Section 6.06    Incapacity....................................................16
   Section 6.07    Spendthrift Provision.........................................16
   Section 6.08    Proof of Claim................................................18
   Section 6.09    De Minimis Benefits...........................................18
ARTICLE VII    Vesting and Separation Benefits...................................19
   Section 7.01    Vesting.......................................................19
   Section 7.02    Forfeitures...................................................19
   Section 7.03    Manner of Payment.............................................19
   Section 7.04    Direct Rollover Transfer to Another Qualified Plan or IRA.....20
ARTICLE VIII   Plan Administrator. Committee and Trustee.........................21
   Section 8.01    Duties and Powers of the Plan Administrator...................21
   Section 8.02    Duties and Powers of the Committee............................21
   Section 8.03    Trustee.......................................................22
   Section 8.04    Administrative Expenses.......................................22
   Section 8.05    Self Interest.................................................22
   Section 8.06    Records.......................................................22
   Section 8.07    Reports.......................................................22
   Section 8.08    Liability.....................................................23
   Section 8.09    Claims and Claims Review......................................23
ARTICLE IX     Amendment of the Plan.............................................25
   Section 9.01    General.......................................................25
ARTICLE X      Termination of Plan...............................................26
   Section 10.01   General.......................................................26
   Section 10.02   Termination...................................................26
</TABLE>

                                       iii

<PAGE>

                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                Page
<S>                                                                              <C>
   Section 10.03   Termination of Employer Participation.........................26
   Section 10.04   Distribution of Trust Fund....................................27
ARTICLE XI      Miscellaneous Provisions.........................................28
   Section 11.01   Construction..................................................28
   Section 11.02   Limitation of Rights..........................................28
   Section 11.03   Limitation of Liability.......................................28
   Section 11.04   Mergers and Consolidations of Plans or Transfers of Assets....28
   Section 11.05   Return of Contributions.......................................28
   Section 11.06   Gender and Number.............................................29
ARTICLE XII     Top-Heavy Provisions.............................................30
   Section 12.01   General.......................................................30
   Section 12.02   Applicable Definitions........................................30
   Section 12.03   Applicability.................................................31
   Section 12.04   Minimum Allocation............................................32
</TABLE>

                                       iv

<PAGE>

     ESTABLISHMENT of the ROTECH HEALTHCARE INC. EMPLOYEES PLAN (the "Plan")
effective as of the 26th day of March, 2002 by ROTECH HEALTHCARE INC. (the
"Company").

                              W I T N E S S E T H:

     WHEREAS, the Company desires to establish a profit sharing plan which is
qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended
(the "Code"); and

     WHEREAS, the Plan may hold qualifying employer securities as described in
Section 407(d)(5) of ERISA and shall be considered an eligible individual
account plan as described in Section 407(d)(3) of ERISA; and

     WHEREAS, this profit sharing plan is established in connection with the
acquisition of the business of Rotech Medical Corporation pursuant to the
[Amended] Joint Plan of Reorganization of Rotech Medical Corporation and Its
Subsidiaries Under Chapter 11 of the Bankruptcy Code, as confirmed by the
Bankruptcy Court for the District of Delaware on February    , 2002 (the
                                                          ---
"Bankruptcy Plan");

     WHEREAS, pursuant to the Bankruptcy Plan and in connection with the
acquisition of the business of Rotech Medical Corporation, the Company shall
immediately contribute 250,000 shares of Series A Convertible Preferred Stock of
the Company to the Plan for the benefit of eligible employees;

     WHEREAS, the Plan will be submitted to the Internal Revenue Service for
approval;

     NOW, THEREFORE, the Company hereby adopts the Plan as follows:

<PAGE>

                                    ARTICLE I
                                   Definitions

     When used herein, the following terms shall have the following meanings
unless the context clearly indicates otherwise:

     Section 1.01 Affiliated Entity - An entity, regardless of whether or not
such entity has adopted the Plan, within the controlled or affiliated service
group of an Employer, as determined by Sections 414(b),(c),(m) and (o) of the
Code and, solely for purposes of Section 3.03, as determined under the rules set
forth in Section 415(h) of the Code.

     Section 1.02 Annual Compensation - The total of cash compensation including
bonuses and overtime paid to a Member by an Employer during the Plan Year
(regardless of when earned) while a Member of the Plan, and reported on the
Member's Form W-2 for income tax purposes plus all amounts not includable as
gross income by reason of Section 402(a)(8) of the Code for deferrals made under
Section 401 (k) of the Code and all amounts not includable as gross income under
Section 125 of the Code, but excluding commissions, reimbursement for expenses
and Employer contributions paid under this Plan or any qualified deferred
compensation plan or any welfare plan, except as provided above. In any Plan
Year in which a Member was not a Member of the Plan at the beginning of the
year, his Annual Compensation shall be deemed to be remuneration as determined
above for that portion of the Plan Year during which he is a Member. In no event
shall Annual Compensation during a Plan Year exceed $200,000 or such other
amount as may be determined by the Secretary of the Treasury pursuant to Section
401(a)(17) of the Code.

     Section 1.03 Beneficiary - The person designated to receive payments in the
event of the death of a Member, as more fully set forth in Section 6.05 hereof.

     Section 1.04 Board - The board of directors of the Company.

     Section 1.05 Change in Control - The occurrence of any of the following:

          (a) any Person (other than the Company or any subsidiary or any
trustee or other fiduciary holding securities under an employee benefit plan of
the company), becomes the beneficial owner (within the meaning of Rule l3d-3
under the Exchange Act) directly or indirectly, of securities of the Company
representing fifty

                                       2

<PAGE>

percent (50%) or more of the combined voting power of the Company's then
outstanding securities;

          (b) during any two consecutive years, individuals who at the beginning
of such period constitute the Board, and any new director (whose election by the
Board or nomination for election by the Company's shareholders was approved by a
vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or
nomination for election was previously so approved), cease for any reason to
constitute at least a majority of the Board;

          (c) the stockholders of the Company approve a merger or consolidation
of the Company with any other company other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than fifty percent (50%) of the combined voting power of the voting
securities of the Company (or such surviving entity) outstanding immediately
after such merger or consolidation, or (ii) a merger or consolidation effected
to implement a recapitalization of the Company (or similar transaction) in which
no Person (as hereinafter defined) acquires more than fifty percent (50%) of the
combined voting power of the Company's then outstanding securities; or

          (d) the stockholders of the Company adopt a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets.

     Section 1.06 Code - The Internal Revenue Code of 1986, as amended from time
to time.

     Section 1.07 Committee - The Committee appointed by the Board to administer
the Plan.

     Section 1.08 Company - Rotech Healthcare Inc., a Delaware corporation, and
any successor in interest.

     Section 1.09 Company Stock - Shares of common or preferred stock of the
Company.

                                       3

<PAGE>

     Section 1.10 Deferred Retirement Date - The first day of the month
following a Member's Separation from Service on or after the attainment of the
Member's Normal Retirement Date.

     Section 1.11 Direct Rollover - A payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.

     Section 1.12 Distributee - A Member, the Member's surviving Spouse and the
Member's Spouse or former Spouse who is the alternate payee under a qualified
domestic relations order as defined in Section 414(p) of the Code.

     Section 1.13 Effective Date -                  , 2002.
                                  ----------- -----

     Section 1.14 Eligible Employee - Any Employee other than (i) any Employee
who is covered by a collective bargaining agreement between employee
representatives and any Employer which does not specifically provide for
participation of the represented Employees in the Plan or (ii) a Leased
Employee.

     Section 1.15 Eligible Rollover Distribution - Any distribution of all or
any portion of the balance of a qualified pension plan (within the meaning of
Section 3(2) of ERISA) to the credit of the Distributee, except that an Eligible
Rollover Distribution does not include: 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) of the Distributee and the Distributee's designated
Beneficiary, or for a specified period of ten (10) years or more; any
distribution to the extent such distribution is required under Section 401(a)(9)
of the Code; and 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 Company Stock).

     Section 1.16 Eligible Retirement Plan - An individual retirement account
described in Section 408(a) of the Code, an individual retirement annuity
described in Section 408(b) of the Code, an annuity plan described in Section
403(a) of the Code, or a qualified trust described in Section 401(a) of the
Code, 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 individual
retirement annuity.

                                       4

<PAGE>

     Section 1.17 Employee - Any person who performs services for an Employer as
an employee including, to the extent required therein, "leased employees" within
the meaning of Section 414(n)(2) of the Code. Notwithstanding the foregoing, the
term "Employee" shall not include leased employees covered by a plan described
in Section 414(n)(5)(B) of the Code, if leased employees constitute less than
20% of the Company's non-highly compensated workforce within the meaning of
Section 414(n)(5)(C)(ii) of the Code.

     Section 1.18 Employer - The Company, and each subsidiary, or affiliate of
the Company, that shall elect to join the Plan with the approval of the Board.

     Section 1.19 Employer Contributions - The contributions made to the Plan by
or on behalf of an Employer pursuant to Section 3.01 hereof.

     Section 1.20 Employment Commencement Date - The later of the date that an
Employee (i) completes his first Hour of Service for an Employer or Affiliated
Entity, on or after the Effective Date or (ii) completes his first Hour of
Service for an Employer or Affiliated Entity following a Separation from Service
after the Effective Date, provided such person is not employed or reemployed by
an Employer or Affiliated Entity within twelve (12) months of his Separation
from Service.

     Section 1.21 Entry Date - The Effective Date and each January 1 and July 1.

     Section 1.22 ERISA - The Employee Retirement Income Security Act of 1974,
as amended from time to time.

     Section 1.23 Exchange Act - The Securities Exchange Act of 1934, as amended
from time to time.

     Section 1.24 Hour of Service - Each hour for which an Employee is directly
or indirectly paid, or entitled to payment, by an Employer for the performance
of duties during the applicable computation period; these hours shall be
credited to the Employee for the computation period or periods in which the
duties were performed.

     "Hour of Service" shall also mean each hour for which back pay,
irrespective of mitigation of damages, or vacation, holiday, illness, incapacity
(including disability), jury duty, military duty, leave of absence, retroactive
or layoff pay has been either awarded or agreed to be paid by an Employer to an
Employee for a period of time during which no duties are performed (irrespective
of whether the employment relationship has

                                       5

<PAGE>

terminated). These hours shall be determined in accordance with the rules set
forth in Department of Labor Regulations Section 2530.200b-2(b) and shall be
credited to the Employee for the computation period or periods to which the
award or agreement pertains rather than the computation period in which the
award, agreement or payment is made, as determined under rules set forth in
Department of Labor Regulations Section 2530.200b-2(c). However, no more than
five hundred one (501) Hours of Service shall be credited pursuant to this
paragraph for any single continuous period described in this paragraph during
which no duties are performed.

     The crediting of an Hour of Service shall be made with reference to a
particular period under either of the preceding paragraphs, but not both.

     An Employee shall receive credit for forty (40) Hours of Service per week
if (i) the Employee did not receive credit for Hours of Service pursuant to the
foregoing, (ii) it is before the Employee's Normal Retirement Date, and (iii)
the Employee is absent from work because of:

     (a)  service in the Armed Forces of the United States; or

     (b)  an authorized leave of absence for sickness, vacation or sabbatical,
          granted in writing and for a period not in excess of two (2) years, or
          a temporary layoff for less than twelve (12) months. Such leaves of
          absence shall be authorized in a uniform and nondiscriminatory manner.

     Notwithstanding anything contained herein to the contrary, an Employee
shall receive no credit for Hours of Service pursuant to the preceding
paragraph, unless the Employee returns to the employ of an Employer within
ninety (90) days following the termination of the relevant period described in
the preceding paragraph or within any longer period prescribed by law or granted
by the Plan Administrator.

     Notwithstanding anything else contained herein to the contrary, (i) an
Employee shall be credited with Hours of Service, if such credit is required by
any Federal law, and (ii) the term "Employer" for the purposes of this
definition shall include Affiliated Entities.

     Section 1.25 Individual Account - A Member's accrued benefits account as
defined in Section 5.01 hereof.

     Section 1.26 Leased Employee - A person described in Section 414(n)(2) of
the Code and any other person providing services to the Company or an Affiliated
Entity

                                       6

<PAGE>

who is not treated by the Company or an Affiliated Entity as an employee for
federal employment tax purposes.

     Section 1.27 Member - A person who (i) is an Eligible Employee and
commenced participation in the Plan in accordance with Article II hereof or (ii)
participated in the Plan in accordance with Article II hereof and has a credit
balance in his Individual Account.

     Section 1.28 Named Fiduciary - The Plan Administrator.

     Section 1.29 Normal Retirement Date - The time a person attains age 65.

     Section 1.30 One-Year Break in Service - A one-year period during which a
person is not employed by an Employer or Affiliated Entity. The computation of a
One-Year Break in Service shall commence upon the date of a person's most recent
Separation from Service.

     Notwithstanding the foregoing, in the case of a person who is absent from
work for any period solely on account of:

     (i)  the pregnancy of the person,

     (ii) the birth of a child of the person,

     (iii) the placement of a child with the person in connection with the
          adoption of such child by such person, or

     (iv) the care of such child for a period beginning immediately following
          such birth or placement,

the person shall be deemed to have incurred a Separation from Service on the
date one (1) year from the date such absence begins, solely for purposes of
determining when the person has incurred a One-Year Break in Service.
Notwithstanding the foregoing, this paragraph shall not be applicable unless the
person furnishes to the Plan Administrator such information as is necessary to
substantiate (a) that a person's absence from work is for the reasons described
in (i) through (iv) above and (b) the number of days for which there was such an
absence.

     Section 1.31 Person - As set forth in Section 13(d) and 14(d) of the
Exchange Act.

     Section 1.32 Plan - The Plan herein set forth, or, if hereinafter amended,
as so amended.

     Section 1.33 Plan Administrator - The Company.

                                       7

<PAGE>

     Section 1.34 Plan Year - The period from the Effective Date to December 31,
2002 and thereafter the calendar year commencing with January 1, 2003.

     Section 1.35 Plans - All plans of Employers and Affiliated Entities
qualified under Part I, Subchapter D, chapter 1 of Subtitle A of the Code,
including any simplified employee pension plan as defined in Section 408(k) of
the Code.

     Section 1.36 Separation from Service - The earliest of (i) the date a
person quits, retires or is discharged from service with all Employers and
Affiliated Entities, (ii) the date a person dies or (iii) the date following a
one-year period during which a person is absent from service with all Employers
and Affiliated Entities for any other reason.

     Section 1.37 Spousal Consent - Written and notarized consent by a Member's
Spouse waiving the right to a death benefit otherwise payable to the Spouse
under the Plan, which includes acknowledgment by the Spouse of the effect of
such waiver.

     Section 1.38 Spouse - The person recognized by the state in which the
Member is domiciled as the Member's legal spouse. A Member shall, in the Plan
Administrator's sole discretion, be deemed not to have a Spouse if the Member or
a Beneficiary establishes to the satisfaction of the Plan Administrator that the
person recognized by such state as the Member's legal spouse cannot be located.
The Plan Administrator shall be entitled to rely upon a representation of a
Member that the Member has no Spouse.

     Section 1.39 Trust Agreement - The Agreement or Agreements with the Trustee
or Trustees referred to in Section 4.01 hereof.

     Section 1.40 Trustee - The Trustee or Trustees designated pursuant to the
Trust Agreement.

     Section 1.41 Trust Fund - The assets of the Trust held by the Trustee under
the Trust Agreement.

     Section 1.42 Valuation Date - The last business day of the month of
December and any other date or dates selected by the Plan Administrator with the
consent of the Trustee.

     Section 1.43 USERRA - The Uniformed Services Employment and Reemployment
Rights Act of 1994, as amended from time to time.

     Section 1.44 Year of Service - A one-year period of employment of an
Employee with an Employer or Affiliated Entity, the computation of which shall

                                       8

<PAGE>

commence with the Employee's Employment Commencement Date and terminate with the
Employee's Separation from Service. Notwithstanding the preceding sentence, for
purposes of calculating the Employee's nonforfeitable percentage under the Plan,
if an Employee has a Separation from Service and thereafter performs an hour of
Service before the first anniversary of the earlier of (i) the date of a
person's Separation from Service or (ii) the first date of a period during which
the person was absent from service for any reason other than a quit, retirement
or discharge which resulted in the person's Separation from Service, the period
of absence from service which falls between the Separation from Service and the
first Hour of Service performed after the Separation from Service shall be
counted towards Years of Service.

     Notwithstanding the foregoing, service in the Armed Forces of the United
States during the period an Employer is required to give reemployment rights by
law shall be counted towards Years of Service, if an Employee returns to work
with an Employer or Affiliated Entity immediately after the termination of such
service.

     Notwithstanding the foregoing, Years of Service credited to a Member prior
to the incurrence of a One-Year Break in Service shall be disregarded for all
Plan purposes until the Member completes a Year of Service following the
occurrence of the most recent One-Year Break in Service.

                                       9

<PAGE>

                                   ARTICLE II
                                  Participation

     Section 2.01 Eligibility - Each Eligible Employee on the Effective Date
shall become a Member of the Plan on the Effective Date. Thereafter, on each
Entry Date, each Eligible Employee who is not a Member shall become a Member.

     Section 2.02 Reemployed Member - Any Eligible Employee who is or was a
Member and who is newly employed or reemployed by an Employer shall be eligible
to participate in the Plan on the date of said employment or reemployment to the
same extent he was previously eligible to participate.

     Section 2.03 Enrollment - After receiving such information as the Plan
Administrator deems necessary from any Employer prior to each Entry Date, the
Plan Administrator shall promptly determine the Eligible Employees and shall
promptly notify each such Eligible Employee in writing of the existence of the
Plan and of its basic provisions.

                                       10

<PAGE>

                                   ARTICLE III
                                  Contributions

     Section 3.01 Employer Contributions - The contribution, if any, by an
Employer to the Trust for each Plan Year shall be the amount fixed by each
Employer or otherwise made by the Company on behalf of each Employer. Such
contribution amount may be recorded in terms of a dollar amount, a percentage of
income for the Plan Year, a percentage of compensation paid or accrued to
Members for the Plan Year, in shares of Company Stock or any combination
thereof. If an Employer determines to make a contribution for any Plan Year (or
a contribution is made on behalf of an Employer), such contribution shall not
exceed twenty-five percent (25%) of the compensation (as defined in Section
404(a)(3) of the Code) paid or accrued to all Members of the Plan who are
Employees of such Employer in respect of said taxable year plus allowable credit
and contribution carryovers, as provided in Section 404(a)(3) of the Code.

     Section 3.02 Allocations - The contributions of an Employer with respect to
a Plan Year made pursuant to Section 3.01 shall be allocated to the Individual
Account of Members (i) who are Eligible Employees of the Employer on the last
day of the Plan Year for which such contribution is made or (ii) who are among
the Members that were Eligible Employees of the Employer during the Plan Year
(a) who retired pursuant to Sections 6.01 or 6.02 or (b) who died during the
Plan Year. Contributions made by or on behalf of an Employer shall be allocated
to each such Member's Individual Account in the ratio to which each such
Member's Annual Compensation bears to the Annual Compensation of all such
Members for such Plan Year.

     Section 3.03 Maximum Annual Additions - The maximum "annual addition", as
hereinafter defined, for any Member shall be the lesser of $40,000 or
one-hundred percent (100%) of the Member's compensation. For purposes of this
Section 3.03, the term "compensation" shall include the total of a Member's
wages, salary and other remuneration for personal services received during the
Plan Year from the Employer and Affiliated Entities, including amounts deferred
pursuant to Section 401(k) or Section 125 of the Code.

     The "annual addition" for a Member shall be the sum of (i) Employer and
Affiliated Entities' contributions for such Member for the Plan Year (including
deferrals

                                       11

<PAGE>

under Section 401(k) of the Code) to defined contribution plans and (ii)
forfeitures allocated to the account of such Member and resulting from
forfeiture provisions of defined contribution plans, if any. If the annual
addition for a Member exceeds the limitations set forth above, reductions shall
be made first to other defined contribution plans before a reduction is made
with respect to allocations under the Plan.

     In the event of a miscalculation of a Member's total Annual Compensation
for a Plan Year, which would result in the maximum permitted annual additions
being exceeded, the excess shall be allocated to a suspense account for the
benefit of the Member whose allocation would otherwise exceed the limits set
forth herein. Such suspense account shall not be valued pursuant to Article V
and no gains and losses of the Trust Fund shall be allocated to such suspense
account. The suspense account on behalf of a Member shall be allocated to the
Individual Account of the Member on the next succeeding Valuation Date, to the
extent that an allocation would otherwise be made pursuant to Section 3.02;
provided the limitations of this Section 3.03 shall not be exceeded.
Notwithstanding anything contained herein or in the Trust Agreement to the
contrary, if the Plan is or is regarded as terminated, amounts held in such
suspense account shall be allocated to the Individual Accounts of Members on the
date of termination according to the allocation provisions of Section 3.02.

     In the event that the Secretary of the Treasury, or his delegate, shall
adjust or has adjusted the $40,000 limits imposed herein to reflect
cost-of-living increases, such limits shall be increased automatically hereunder
effective as of the first day of the Plan Year during which any such adjustment
takes effect, to the same extent as provided in any announcement issued by the
Secretary of the Treasury or his delegate of an adjustment of such limits.

     For the purpose of Section 415 of the Code and this Section, calculations
shall be based on the limitation year. For all purposes, the limitation year
shall be the Plan Year.

     Section 3.04 USERRA - Notwithstanding any provisions of the Plan to the
contrary, benefit and service credit with respect to qualified military service
shall be provided in accordance with Section 414(u) of the Code.

                                       12

<PAGE>

                                   ARTICLE IV
                                   Trust Fund

     Section 4.01 General - The benefits in this Plan shall be provided by the
Trust Fund, which shall consist of Employer Contributions and all investments
made therewith and all proceeds thereof and all earnings and profits thereon,
less payments made therefrom. The Trust Fund shall be held in accordance with
the Plan and the Trust Agreement entered into between the Company and the
Trustee. The Trust Agreement may from time to time be amended in the manner
provided therein.

                                       13

<PAGE>

                                    ARTICLE V
                                Members' Accounts

     Section 5.01 Individual Accounts - The Plan Administrator shall establish
and cause to be maintained an Individual Account for each Member which shall
consist of:

     (i)  the Employer Contributions allocable to the Member; and

     (ii) the Member's allocable share of the income and expenses and realized
          and unrealized gains and losses of the Trust Fund.

The Individual Account is solely a bookkeeping account and shall represent a
Member's undivided interest in the Trust Fund.

     Section 5.02 Valuation - As of each Valuation Date, the Trustee shall
determine and report to the Plan Administrator the fair market value of the
assets of the Trust Fund and the income and expenses and realized and unrealized
gains and losses of the Trust Fund for the period from the last Valuation Date
to the current Valuation Date. The Trustee shall allocate such amount among the
respective Individual Accounts of the Members (excluding Employees who first
became Members during the Plan Year in which the Valuation Date falls) in
proportion to their respective account balances.

     Section 5.03 Termination of Participation in Trust Fund - After the
Valuation Date as of which the benefits of a Member are fully paid pursuant to
the provisions of Article VI, VII or X, such Member's Individual Account shall
be closed. Thereafter, neither the Member nor any person claiming under or
through him shall participate or have any interest in the Trust Fund.

                                       14

<PAGE>

                                   ARTICLE VI
                          Retirement and Death Benefits

     Section 6.01 Normal Retirement - Each Member who has a Separation from
Service on attainment of his Normal Retirement Date shall be entitled to a lump
sum retirement benefit which can be provided from the Member's Individual
Account. A Member shall be 100% vested in his Individual Account upon attaining
his Normal Retirement Date prior to his Separation from Service.

     Section 6.02 Retirement After Normal Retirement Date - A Member may
postpone retirement and continue in an Employer's employ and participate in the
Plan after his Normal Retirement Date. In such event, the commencement of the
payment of a Member's retirement benefit shall be deferred until the Member's
Deferred Retirement Date. Upon the Member's Deferred Retirement Date, the Member
shall receive a retirement benefit as if the Member were then retiring pursuant
to Section 6.01 hereof.

     Section 6.03 Death of Member - If a Member dies before such Member's
Individual Account is distributed under the Plan, a death benefit shall be
payable to the Member's Beneficiary of the vested balance of the Member's
Individual Account, as determined under Section 7.01. The Plan Administrator may
require that any Beneficiary that is not the Member's Spouse submit information
as is needed to verify that the Member had no Spouse at the time of his death or
that there was a Spousal Consent to the designation of such Beneficiary. All
distributions hereunder of a Member's vested Individual Account shall be made as
soon as practicable following the Member's death and shall be based on the value
of the deceased Member's Individual Account determined as of the Valuation Date
coinciding with or immediately following his date of death or the Valuation Date
immediately preceding commencement of payment of benefits.

     Section 6.04 Time for Payment of Benefits and Valuation - Notwithstanding
anything herein to the contrary, unless a Member elects otherwise, in writing,
specifying the benefit and time payment is to begin, the payment of benefits
pursuant to this Article VI to each Member shall begin not later than the later
of sixty (60) days after the close of the Plan Year in which falls (i) the
Member's Normal Retirement Date or (ii) the date the Member incurs a Separation
from Service after the Member's Normal Retirement Date (unless payment is
delayed for administrative reasons). Benefits to a

                                       15

<PAGE>

Member who is a 5% owner shall commence on the April 1 following the end of the
calendar year in which the Member attains age 70 1/2.

     The amount of any benefit payable under the Plan shall be based upon the
value of a Member's Individual Account at the Valuation Date coinciding with or
immediately preceding the commencement of payment of benefits.

     Section 6.05 Designation of Beneficiary - At any time, and from time to
time, each Member shall have the unrestricted right to designate a Beneficiary
or change a Beneficiary to whom payments of any undistributed amount of his
Individual Account shall be made in the event of the Member's death.
Notwithstanding the preceding sentence, a Member shall be deemed to have
designated his Spouse as sole Beneficiary of the Member's Individual Account,
unless the Member obtains Spousal Consent to name another person as Beneficiary.
Each such designation shall be evidenced by a written instrument signed by the
Member and be on file with the Plan Administrator before his death. If the
designated Beneficiary survives the Member, but dies prior to receiving the full
amount of the Member's vested Individual Account, distribution of the amount
shall be made to any successor Beneficiary previously designated by the Member.
If any Member shall fail to designate a successor Beneficiary, the successor
Beneficiary shall be deemed to be the Beneficiary's estate. If there is no
living Beneficiary or successor Beneficiary at the time of a Member's death, the
Beneficiary shall be deemed to be the Member's estate.

     Section 6.06 Incapacity - If any person to whom a benefit is payable
hereunder is an infant or if the Plan Administrator determines that any person
to whom such benefit is payable is incompetent by reason of physical or mental
disability, the Plan Administrator may cause the payments becoming due to such
person to be made to another for his benefit without responsibility of the Plan
or the Trustee to see to the application of such payment. Payment made pursuant
to this Section 6.06 shall, as to such payment, operate as a complete discharge
of the Trust Fund, the Trustee and the Plan Administrator.

     Section 6.07 Spendthrift Provision - No benefit payable under the Plan
shall, except as otherwise specifically provided by law, be subject in any
manner to anticipation, alienation, garnishment, sale, transfer, assignment,
pledge, encumbrance or

                                       16

<PAGE>

discharge, and any attempt so to anticipate, alienate, sell, transfer, assign,
pledge, encumber or charge such benefit shall be void; nor shall any benefit be
in any manner liable for or subject to the debts, contracts, liabilities,
engagements or torts of the person entitled thereto.

     Notwithstanding the foregoing, the Trustee is specifically authorized to
comply with any "domestic relations order" which the Plan Administrator
determines to be a "qualified domestic relations order." For this purpose, a
"domestic relations order" shall mean any judgment, decree or order (including
approval of a property settlement agreement) within the meaning of Section
414(p) of the Code which relates to the provision of child support, alimony
payment, or marital property rights to a Spouse, former Spouse, child or other
dependent of a Member, and is made pursuant to a State domestic relations law
(including a community property law) and a "qualified domestic relations order"
shall mean a domestic relations order within the meaning of Section 414(p) of
the Code which the Plan Administrator, in its sole discretion and applying
uniform rules, determines to meet the following requirements:

     (i)  such order assigns to a Member's Spouse, former Spouse, child or other
          dependent of the Member, or creates or recognizes the existence of, a
          right to receive all or a portion of, the Member's benefits payable
          under the Plan (hereinafter referred to as the "alternate payee");

     (ii) such order clearly specifies (1) the name and last known mailing
          address (if any) of the Member and the name and mailing address of
          each alternate payee, (2) the amount or percentage of the Member's
          benefits to be paid by the Plan to each such alternate payee, or the
          manner in which such amount or percentage is to be determined, (3) the
          number of payments or the period to which such order applies, and (4)
          that the order applies to the Plan; and

     (iii) such order does not (1) require the Plan to provide any type or form
          of benefits, or any option, not otherwise provided under the Plan, (2)
          require the Plan to provide increased benefits (determined on the
          basis of actuarial value), and (3) require the payment of benefits to
          an alternate payee which

                                       17

<PAGE>

          are required to be paid to another alternate payee under another order
          previously determined to be a qualified domestic relations order.

     Upon the Plan Administrator's receipt of a domestic relations order, it
shall promptly notify the Member and any alternate payee of the receipt of such
order and the Plan's procedures for determining whether such order is a
qualified domestic relations order. The determination by the Plan Administrator
of whether a domestic relations order is a qualified domestic relations order
shall be made pursuant to written procedures adopted by the Plan Administrator.
During any period in which the issue of whether a domestic relations order is a
qualified domestic relations order is being determined, the Plan Administrator
shall separately account for the amounts which would have been payable to the
alternate payee ("segregated amounts") during such period if the order had been
determined to be a qualified domestic relations order. If within eighteen (18)
months of the date on which the first payment would be required to be made under
the domestic relations order it is determined that the order is not a qualified
domestic relations order, or the issue as to whether such order is a qualified
domestic relations order is not resolved, then the Plan Administrator shall
cause the segregated amounts (plus any interest thereon) to be paid to the
Member or his Beneficiary if payment would have otherwise been made absent such
order. Any determination thereafter that an order is a qualified domestic
relations order shall be applied prospectively only.

     Section 6.08 Proof of Claim The Plan Administrator may require such proof
of death and such evidence of the right of any person to receive payment of a
deceased Member's interest in the Trust Fund as the Plan Administrator may deem
reasonable.

     Section 6.09 De Minimis Benefits Notwithstanding anything contained herein
to the contrary, in the event the benefit a Member or Beneficiary is entitled to
under the provisions of this Article VI is not greater than $5,000 (or such
other amount set forth under Section 411(a)(7)(B) of the Code), the Plan
Administrator shall distribute such benefit in a lump sum as soon as practicable
after a Member's Separation from Service, and such Member or Beneficiary shall
then have no further interest in the Plan with respect to the Member's
employment prior to his Separation from Service.

                                       18

<PAGE>

                                   ARTICLE VII
                         Vesting and Separation Benefits

     Section 7.01 Vesting - A Member's vested interest in his Individual Account
shall be a percentage determined from the following schedule:

----------------------------------------------------------------------
Years of Service Following the Effective Date   Percent Nonforfeitable
----------------------------------------------------------------------
Less than 2                                                0
----------------------------------------------------------------------
2                                                         25
----------------------------------------------------------------------
3                                                         50
----------------------------------------------------------------------
4                                                         75
----------------------------------------------------------------------
5 or more                                                100
----------------------------------------------------------------------

          Notwithstanding the foregoing, upon a Change in Control, all Members
who have not had a Separation from Service shall become 100% vested in their
Individual Accounts.

     Section 7.02 Forfeitures - At the end of a Plan Year following a Separation
from Service by a Member, the nonvested interest of a Member's Individual
Account shall be forfeited and shall be reallocated to the Individual Accounts
of the remaining Members who were Eligible Employees at the end of such Plan
Year pursuant to Section 3.02.

     In the event the Member is reemployed prior to the incurrence of five (5)
consecutive One-Year Breaks in Service, the amount forfeited, adjusted on a
reasonable basis for any gains or losses that would have been allocated to the
amount forfeited prior to its restoration, shall be restored as of the last day
of the Plan Year in which the Member is reemployed, first, by utilizing all
forfeitures in that Plan Year and then as needed, by additional contributions of
the Employer.

     Section 7.03 Manner of Payment - A Member who has a Separation from Service
prior to attaining his Normal Retirement Date, other than by reason of death,
and who has a vested interest pursuant to Section 7.01 shall be entitled to the
pay out of his vested interests upon such Member's attainment of Normal
Retirement Date, in accordance with the provisions of Article VI. Members who
have a Separation from Service prior to the attainment of their Normal
Retirement Date, other than by reason of death, and whose vested Individual
Account is not greater than $5,000 (or such other amount set forth under Section
411(a)(7)(B) of the Code), shall have their vested

                                       19

<PAGE>

Individual Account distributed in a lump sum, as soon as practicable after the
later of the Valuation Date following the Member's Separation from Service or
the Valuation Date following the fifth anniversary of the Effective Date of the
Plan. Such Member (or such Member's Beneficiary) shall then have no further
interest in the plan with respect to the Member's employment prior to his
separation from Service.

     Section 7.04 Direct Rollover Transfer to Another Qualified Plan or
IRA - Pursuant to Section 401(a)(31) of the Code, under rules established by the
Plan Administrator, a Distributee may elect to have any, portion of an Eligible
Rollover Distribution paid directly to an Eligible Retirement Plan as a Direct
Rollover.

                                       20

<PAGE>

                                  ARTICLE VIII
                    Plan Administrator, Committee and Trustee

     Section 8.01 Duties and Powers of the Plan Administrator - The Plan
Administrator shall have all powers necessary to discharge its duties, including
but not limited to, the power to interpret or construe the Plan, to establish
uniform and nondiscriminatory rules for the administration of the Plan, to
determine all questions of eligibility, status and rights of Employees, Members
and their Beneficiaries and others hereunder, and to decide any dispute arising
hereunder, to the extent discretion on such issue is not delegated to the
Committee under the Plan. The Plan Administrator shall have such powers with
respect to the administration of the Trust Fund as may be conferred upon it by
the Trust Agreement. In exercising any discretion allowed by the Plan, the Plan
Administrator shall have sole, absolute and final discretionary authority which
shall be final and binding on Members and all other parties, to the maximum
extent allowed by law.

     The Plan Administrator may adopt such rules and regulations as it deems
desirable for the conduct of its affairs. It may delegate to any agent, any
duties and powers as it deems appropriate.

     Section 8.02 Duties and Powers of the Committee - The Board shall select
not less than three (3) persons to serve on the Committee. Members of the
Committee may be officers, directors, employees of an Employer or others and
shall hold office at the pleasure of the Board and shall serve without
compensation. Any member of the Committee may resign by giving notice thereof to
the Company and to the Committee and such resignation shall become effective at
delivery or at any later date specified therein. A vacancy in the Committee
shall be filled by the Board. The Committee shall have all the powers necessary
to discharge its duties with respect to resolving disputes under the Plan, to
the maximum extent permitted by law.

     The Committee may adopt such rules and regulations as it deems desirable
for the conduct of its affairs and may appoint one of its own members as
Chairman and one as Secretary and may appoint one or more agents, who need not
be members of the Committee. It may delegate to any agent such duties and
powers, both ministerial and discretionary, as it deems appropriate excepting
only that any dispute shall be determined

                                       21

<PAGE>

by the Committee. A majority of the Committee then in office shall constitute a
quorum for the transaction of business. Any determination of the Committee shall
be made by a majority of the quorum or by unanimous approval of its members, if
there are only two members in office at the time.

     Section 8.03 Trustee - The Board will appoint the Trustee, and thereafter,
subject to the provisions of the Trust Agreement, may at any time terminate the
appointment of a Trustee and make a substitute appointment immediately
thereafter. The Trustee or Trustees appointed by the Board shall serve on such
terms as to remuneration and otherwise as shall from time to time be agreed
between the Company and such Trustee. Notwithstanding anything to the contrary
in the Plan, the Trustee shall have such powers and duties in relation to the
investment and change of investments of all or any part of the assets of the
Trust Fund as provided in the Trust Agreement.

     Neither the Committee nor the Plan Administrator shall have any fiduciary
liability for the acts or omissions of such Trustee or be under an obligation to
invest or otherwise manage that portion of the Trust Fund which is subject to
the management of such Trustee.

     Section 8.04 Administrative Expenses - Any administrative expenses with
respect to the Plan and any expenses of the Committee or the Plan Administrator
relating to administration of the Plan shall be paid out of the Trust Fund to
the extent not paid by the Company or an Employer.

     Section 8.05 Self Interest - No member of the Committee shall have any
right to vote or decide upon any matter relating solely to himself or solely to
any of his rights or benefits under the Plan.

     Section 8.06 Records - The Plan Administrator may retain a recordkeeper
which may be the Trustee to keep or cause to be kept such records and data as
may be necessary for the administration of the Plan and to determine the amount
of all benefits payable hereunder.

     Section 8.07 Reports - The Plan Administrator shall cause to be prepared
annually those reports showing the financial condition of the Trust Fund in
reasonable summary and giving a brief account of the operations of the Plan for
the past Plan Year and reflecting any further information which each Employer
may require or which may

                                       22

<PAGE>

be required by law. Such reports shall be submitted to each Employer and copies
filed in the office of the Plan Administrator. The Plan Administrator shall make
available to each Member for examination at reasonable times during business
hours such of its records as pertain to that Member.

     Section 8.08 Liability - The members of the Committee, the Plan
Administrator (and its agents) and each Employer shall be entitled to rely upon
all valuations, certificates, and reports furnished by the Trustee or by
accountants or consultants selected by the Committee or Plan Administrator and
approved by the Company, and upon all opinions given by any legal counsel
selected by the Plan Administrator or the Committee and approved by the Company,
or selected by the Company and the members of the Committee and each Employer
shall be fully protected with respect to any action taken or suffered by their
having relied in good faith upon such Trustee, accountants, consultants or
counsel and all action so taken or suffered shall be conclusive upon each of
them and upon all Members and their Beneficiaries and all other persons.

     The Company and each Employer shall indemnify members of the Committee, any
individual (noncorporate) Trustee and any of their agents as well as agents of
the Plan Administrator acting in behalf of the Plan against any and all
liabilities or expenses to which they may be subjected by reason of any act or
failure to act which constitutes a breach of fiduciary responsibility under
ERISA or otherwise, except that due to a person's own gross negligence or
willful misconduct.

     Section 8.09 Claims and Claims Review - Claims for benefits under the Plan
shall be filed with the Plan Administrator. Written notice of the disposition of
a claim shall be furnished to the claimant within ninety (90) days after the
claim is filed. If the claim is denied, the reasons for the denial shall be
specifically set forth in writing, pertinent provisions of the Plan shall be
cited, including an explanation of the Plan's claims review procedure, and, if
the claim is perfectible, an explanation as to how the claimant can perfect the
claim shall be provided.

     If a claimant whose claim has been denied wishes further consideration of
his claim, he may request the Committee to review his claim in a written
statement of the claimant's position filed with the Committee no later than
sixty (60) days after receipt of the written notification provided for in the
previous paragraph. The Committee shall

                                       23

<PAGE>

fully and fairly review the matter and shall promptly advise the claimant, in
writing, of its decision within the next sixty (60) days. Due to special
circumstances, if no advice has been given within the first sixty (60) days, and
notice of the need for additional time has been furnished within such period,
said review and advice may be made within the following sixty (60) days.

                                       24

<PAGE>

                                   ARTICLE IX
                              Amendment of the Plan

     Section 9.01 General - The Board may amend the Plan at any time and from
time to time. Except where necessary to qualify the Plan or to maintain the
qualification of the Plan under the Code, no amendment shall reduce any then
accrued or vested interests of a Member nor shall it reduce any "accrued
benefit" of a Member as such term is given meaning under Section 411(d)(6) of
the Code and the regulations thereunder.

     No part of the Trust Fund, other than such part as may be required to pay
taxes, administration expenses and fees, or as otherwise permitted under ERISA
or the Code, shall by reason of any amendment or otherwise be used or diverted
to purposes other than for the exclusive benefit of Members and Beneficiaries.

                                       25

<PAGE>

                                    ARTICLE X
                               Termination of Plan

     Section 10.01 General - While the Plan is intended to be permanent, the
Company may terminate or partially terminate the Plan at any time, or any
Employer may withdraw from participation in the Plan. Written notice of such
termination, setting forth the date thereof, shall be given to both the Trustee
and the Plan Administrator.

     Section 10.02 Termination - Upon a termination or partial termination of
the Plan, whether in writing or in operation, or upon a complete discontinuance
of contributions thereunder, (i) no further contributions shall be made under
the Plan for any affected Member, (ii) all of the provisions of the Plan shall
remain in full force other than the provisions for contributions, and (iii) the
amount in each affected Member's Individual Account shall be nonforfeitable.

     Section 10.03 Termination of Employer Participation - (a) Any Employer,
with the consent of the Company or its delegate may terminate its participation
in the Plan by giving the Plan Administrator prior written notice specifying a
termination date which shall be the last day of a month at least sixty (60) days
subsequent to the date such notice is received by the Plan Administrator. The
Company may terminate any Employer's participation in the Plan as of any
termination date specified by the Company, for the failure of the Employer to
make contributions or to comply with any provision of the Plan.

     (b) Upon the termination of participation in the Plan as to any Employer,
such Employer shall not make any further contributions under the Plan and no
amount shall thereafter be payable under the Plan to or in respect of any
Members then employed by such Employer, except as provided in this Section
10.03. To the maximum extent permitted by law, any rights of Members no longer
employed by such Employer and of former Members and their Beneficiaries and
surviving Spouses under the Plan shall be unaffected by such termination
of participation and any transfers, distributions or other dispositions of the
assets of the Plan as provided in Section 11.04 shall constitute a complete
discharge of all liabilities under the Plan with respect to such Employer
participation in the Plan and any Member then employed by such Employer.

                                       26

<PAGE>

     Section 10.04 Distribution of Trust Fund - Upon termination of the Plan,
the Company, in its sole discretion, may elect to terminate the Trust Agreement.
In such event, each Member's Individual Account shall be paid to such Member (or
Beneficiary of a deceased Member) in a lump sum, as soon as practicable after
applicable regulatory approvals. Any unallocated shares of Company Stock then
held by the Plan shall be allocated to the Individual Accounts of all Members
immediately prior to such termination pursuant to the provisions of Section
3.02.

                                       27

<PAGE>

                                   ARTICLE XI
                            Miscellaneous Provisions

     Section 11.01 Construction - All questions pertaining to the construction,
regulation, validity and effect of the provisions of the Plan shall be
determined in accordance with the laws of the State of Florida, except as may be
pre-empted by ERISA or other federal law.

     Section 11.02 Limitation of Rights - The adoption and maintenance of the
Plan shall not be deemed to constitute a contract between any Employer and any
Employee or Member, and nothing herein contained shall be deemed to give to any
Employee or Member the right to be retained in the employ of any Employer or to
interfere with the right of any Employer to discharge any Employee or Member at
any time.

     Section 11.03 Limitation of Liability - All benefits payable under the Plan
shall be paid or provided for solely from the Trust Fund and each Employer
assumes no liability or responsibility therefor.

     Section 11.04 Mergers and Consolidations of Plans or Transfers of Assets -
The Company may direct the merger or consolidation of the Plan or the transfer
of all or a portion of the assets of the Plan to another plan. Further, an
Employer withdrawing from the Plan may request the transfer of assets of the
Plan allocable to Members who are its Employees to another plan. 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, any other plan, each Member shall (if such
plan is then terminated) be entitled in accordance with Section 414(1) of the
Code to 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).

     Section 11.05 Return of Contributions - Any contribution made by an
Employer under a mistake of fact may be returned to the Employer by the Trustee
within one year after the payment of the contribution and the Individual Account
of any Member affected shall be adjusted accordingly. If and to the extent a
deduction under Section 404 of the Code for an Employer contribution is
disallowed, the contribution shall be returned

                                       28

<PAGE>

to the Employer by the Trustee within one year after the disallowance of the
deduction, and the Individual Account of any Member affected shall be adjusted
accordingly.

     Section 11.06 Gender and Number - All references herein to the masculine
shall be read in the masculine or feminine and all references herein to the
singular shall be read in the singular or plural, unless the context shall
otherwise require.

                                       29

<PAGE>

                                   ARTICLE XII
                              Top-Heavy Provisions

     Section 12.01 General - Notwithstanding any other provision of this Plan to
the contrary, this Article XII shall apply to any Plan Year, if the Plan is
deemed to be a Top-Heavy Plan, as hereinafter defined, for such Plan Year.

     Section 12.02 Applicable Definitions - The defined terms used in this
Article XII not otherwise defined in Article I hereof shall have the following
meanings:

          (a) "Determination Date" means the last day of the preceding Plan
Year, if any; otherwise the last day of the Plan Year.

          (b) "Determination Period" means the Plan Year ending on the
Determination Date.

          (c) For purposes of this Article XII, the term "Employee" will not
include individuals who have not performed an Hour of Service during the
Determination Period.

          (d) "Key Employee" means an Employee, a former Employee, or the
Beneficiary of an Employee or a former Employee who, at anytime during the
Determination Period was:

               (i)  an officer of an Employer having Annual Compensation greater
                    than fifty percent (50%) of the amount in effect under
                    Section 415(b)(1)(A) of the Code for any such Plan Year,
                    provided that not more than fifty (50) Employees or, if
                    less, the greater of three (3) Employees or ten percent
                    (10%) of the Employees shall be considered as officers for
                    purposes of this subparagraph;

               (ii) a five percent (5%) owner (within the meaning of Section
                    416(i) of the Code) of the Employer;

               (iii) a one percent (1%) owner (within the meaning of Section
                    416(i) of the Code) of the Employer having an annual
                    compensation (within the meaning of Treasury Regulation
                    Section 1.415-2(d)) from the Employer of more than $150,000.
                    A non-Key Employee is any Employee who is not a Key
                    Employee.

          (e) "Required Aggregation Group" means:

               (i)  Each stock bonus, pension, or profit-sharing plan of the
                    Employer and/or Affiliated Entity (whether or not
                    terminated) in which a Key Employee participates at any

                                       30

<PAGE>

                    time during the Determination Period and which is intended
                    to qualify under Section 401 (a) of the Code.

               (ii) Each other stock bonus, pension or profit-sharing plan of an
                    Employer and/or Affiliated Entity which enables any plan in
                    which a Key Employee participates to meet the requirements
                    of Section 401(a)(4) or Section 410 of the Code.

          (f) "Permissive Aggregation Group" means a Required Aggregation Group
or, at the election of the Employer, a Required Aggregation Group plus one or
more plans of the Employer and/or Affiliated Entity (whether or not terminated)
which are not part of the Required Aggregation Group but which together with the
Required Aggregation Group satisfy the requirements of Sections 401(a)(4) and
410 of the Code.

          (g) "Accrued Benefit Value" means with respect to each Employee with
an accrued benefit during the Determination Period the sum of:

     Actuarial assumptions approved by the Plan Administrator, in accordance
with Treasury Department regulations, shall be utilized in determining present
values.

          (h) "Account Value" means the sum of:

               (i)  the aggregate balance of the account(s) of an Employee under
                    the plan(s) as of the Valuation Date;

               (ii) any contributions allocated to such account(s) after the
                    Valuation Date and on or before the Determination Date; and

               (iii) the aggregate distributions made with respect to such
                    account(s) during the Determination Period and not reflected
                    in the value of the account(s) as of the most recent
                    Valuation Date under (i) above.

     The determination of Accrued Benefit Value and Account Value shall be made
in accordance with Treasury Department regulations.

          (i) "Valuation Date" means the valuation date of the applicable plan
within the twelve (12) month period ending on the Determination Date.

     Section 12.03 Applicability - The Plan shall be a "Top-Heavy Plan" if, as
of the Determination Date, (a) the Account Values of Key Employees exceed sixty
percent (60%) of the Account Values of all Employees and Key Employees (but
excluding for all purposes the Account Values of former Key Employees) under the
Plan, or (b) the Plan is

                                       31

<PAGE>

part of a Permissive Aggregation Group and the Permissive Aggregation Group is a
Top-Heavy Group.

     In determining whether this Plan is a Top-Heavy Plan, all Employers and
Affiliated Entities shall be treated as a single Employer and all plans that are
part of the Required Aggregation Group shall be treated as a single plan. Solely
for purposes of determining whether this Plan is a "Top-Heavy Plan," the Accrued
Benefit Values and the Account Values of any Employee who has performed no
services for any Employer maintaining the Plan at any time during the Plan Year
ending on the Determination Date shall be disregarded.

     The Plan shall be part of a "Top-Heavy Group" if, as of the Determination
Date, the sum of:

     (a)  the Accrued Benefit Values of Key Employees under all defined benefit
          plans included in the Required Aggregation Group, and

     (b)  the Account Values of Key Employees under all defined contribution
          plans included in the Required Aggregation Group, exceeds sixty
          percent (60%) of the sum of:

          (i)  the Accrued Benefit Values of all Employees under such defined
               benefit plans included in the Required Aggregation Group, and

          (ii) the Account Values of all Employees under such defined
               contribution plans included in the Required Aggregation Group,
               excluding for all purposes the Accrued Benefit Values and Account
               Values of former Key Employees.

     Notwithstanding the foregoing provisions of this Section 12.03, the Plan
shall not be considered a Top-Heavy Plan for any Plan Year in which it is part
of a Required Aggregation Group or Permissive Aggregation Group which is not a
Top-Heavy Group.

     Section 12.04 Minimum Allocation - If the Plan is a Top-Heavy Plan in a
Plan Year, the Employer shall contribute on behalf of each Member who is not a
Key Employee for such Plan Year to the extent not otherwise contributed by the
Employer for such Plan Year on behalf of the Member to any other qualified plan
maintained by the Employer, the lesser of (a) three percent (3%) or (b) the
highest percentage of Employer contributions (including salary deferral
contributions by the Employer pursuant to Section 401 (k) of the Code) allocable
to a Key Employee for such Plan Year of each such Member's compensation up to a
maximum of $160,000 for such Plan Year within the

                                       32

<PAGE>

meaning of Treas. Reg. (S) 1.415-2(d). The determination of the highest
percentage of Employer Contributions allocable to a Key Employee for a Plan Year
shall be made for each such Key Employee by dividing the contributions made on
behalf of each Key Employee by his Annual Compensation. Contributions made
pursuant to this Section 12.04 to Members who are not Key Employees shall be
allocated to the Individual Accounts of Members who are Employees on the last
day of the Plan Year. In the event a Member otherwise entitled to a minimum
allocation hereunder is also a participant in a defined benefit qualified plan
that is determined to be a Top-Heavy Plan for the Plan Year, such Member shall
not receive a minimum allocation hereunder.

                                       33

<PAGE>

          IN WITNESS WHEREOF, this instrument has been executed as of the day
and year first above written.

                                    ROTECH HEALTHCARE INC.

                                    By:/s/ Janet L. Ziomek
                                       -----------------------------------------
                                    By: Janet L. Ziomek
                                    Title: Chief Financial Officer and Treasurer<PAGE>

                                                                    Exhibit 10.8

                             ROTECH HEALTHCARE INC.
                            COMMON STOCK OPTION PLAN

     1. Purpose.
        -------

          The purpose of the Rotech Healthcare Inc. Common Stock Option Plan
(the "Plan") is to enhance the ability of Rotech Healthcare Inc. (the "Company")
to attract and retain employees, officers, consultants and nonemployee members
of the Board of Directors of the Company of outstanding ability, and provide
them with an interest in the growth and continued success of the Company by
granting them Options to purchase shares of the Company's common stock

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

          Whenever the following terms are used in this Plan, they shall have
the meaning specified below unless the context clearly indicates to the
contrary.

          "Board" shall mean the Board of Directors of the Company or a
           ------
committee thereof, including any compensation committee created by the Board of
Directors.

          "Cause" shall mean (i) a Participant's gross neglect of or willful
           ------
failure to perform his or her material duties with the Company, which neglect or
failure shall continue for a period of two (2) days after receipt by Participant
of written notice from the Company directing such Participant to perform his or
her material duties, (ii) a Participant's willful engaging in conduct which is
materially injurious to the Company or any subsidiary, which injury shall not
have been remedied with two (2) days after receipt by Participant of written
notice from the Company of the injury caused by such conduct, (iii) a
Participant's theft or misappropriation of funds of the Company, or any
subsidiary, (iv) a Participant's conviction of, or plea of nolo contendere to, a
felony or a misdemeanor involving moral turpitude, or (v) a Participant's
causing the Company to violate a local, state or federal law where such
violation is materially injurious to the Company; provided, that if the
Participant has entered into an agreement with the Company, the Board shall
substitute the definition of Cause set forth in such agreement for the above.

          "Change in Control" shall mean the occurrence of any of the following:
           ------------------

          (a) any Person (other than the Company or any subsidiary or any
trustee or other fiduciary holding securities under an employee benefit plan of
the Company), becomes the beneficial owner (within the meaning of Rule l3d-3
under the Exchange Act) directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the combined voting power of the
Company's then outstanding securities;

          (b) during any two consecutive years, individuals who at the beginning
of such period constitute the Board, and any new director (whose election by the
Board or nomination for election by the Company's shareholders was approved by a
vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the

<PAGE>

period or whose election or nomination for election was previously so approved),
cease for any reason to constitute at least a majority of the Board;

          (c) the stockholders of the Company approve a merger or consolidation
of the Company with any other company other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than fifty percent (50%) of the combined voting power of the voting
securities of the Company (or such surviving entity) outstanding immediately
after such merger or consolidation, or (ii) a merger or consolidation effected
to implement a recapitalization of the Company (or similar transaction) in which
no "person" (as hereinafter defined) acquires more than fifty percent (50%) of
the combined voting power of the Company's then outstanding securities; or

          (d) the stockholders of the Company adopt a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets.

          "Code" shall mean the Internal Revenue Code of 1986, as amended.
           -----

          "Company" shall mean Rotech Healthcare Inc., a Delaware corporation,
           --------
and any successor corporation.

          "Disability" shall mean the inability to engage in any substantial
           -----------
gainful activity by reason of any medically determined physical or mental
impairment which can be expected to result in death or which has lasted or can
be expected to last for a continuous period of not less than twelve (12) months.

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

          "Fair Market Value" per Share as of a particular date shall mean,
           ------------------
unless otherwise determined by the Board:

               (i) the closing sales price per Share on a national securities
exchange for the business day preceding the exercise date on which there was a
sale of Shares on such exchange;

               (ii) if clause (i) does not apply and the Shares are then quoted
on the National Association of Securities Dealers Automated Quotation system
(known as "NASDAQ"), the closing price per Share as reported on such system for
the business day preceding the exercise date on which a sale was reported;

               (iii) if clause (i) or (ii) does not apply and the Shares are
then traded on an over-the-counter market, the closing price for the Shares in
such over-the-counter market for the business day preceding the exercise date;
or

                                      -2-

<PAGE>

               (iv) if the Shares are not then listed on a national securities
exchange or traded in an over-the-counter market, such value as the Board in its
sole discretion may reasonably determine.

          "Immediate Family Member" shall include any child, stepchild,
           ------------------------
grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling,
niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, any person
sharing the Participant's household (other than a tenant or employee), a trust
in which these persons have more than fifty percent (50%) of the beneficial
interest, a foundation in which these persons (or the Participant) control the
management of assets, and any other entity in which these persons (or the
Participant) own more than fifty percent (50%) of the voting interests.

          "Incentive Stock Option" shall mean an Option intended to meet the
           -----------------------
requirements of Section 422 of the Code.

          "Initial Public Offering" shall mean the consummation of the first
           ------------------------
underwritten public offering of the Company's Shares for the account of the
Company pursuant to a registration statement (other than on Form S-4 or Form
S-8 or successor forms) filed with, and declared effective by, the United States
Securities Exchange Commission.

          "Nonqualified Stock Option" shall mean any option which is not an
           --------------------------
Incentive Stock Option.

          "Option" shall mean an option to purchase Shares granted pursuant to
           -------
the Plan.

          "Option Agreement" shall mean an Option Agreement between the Company
           -----------------
and any Participant, which shall set forth the terms and conditions of the
Option granted to such Participant.

          "Participant" shall mean any Person who is granted an Option under the
           ------------
Plan.

          "Person" shall have the meaning set forth in Sections 13(d) and 14(d)
           -------
of the Exchange Act.

          "Share" shall mean a share of the Company's common stock, $0.0001 par
           ------
value.

          "Ten Percent Shareholder" shall mean any Participant who owns Shares
           ------------------------
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company or any parent or subsidiary corporation within
the meaning of Section 424 of the Code.

     3. Shares Subject to the Plan.
        --------------------------

          (a) Shares Subject to the Plan. Subject to adjustment as set forth in
              --------------------------
Section 3(b), the maximum number of Shares that may be issued or transferred
pursuant to Options under this Plan shall be three million twenty-five thousand
(3,025,000) which may be authorized but unissued Shares or Shares held in the
Company's treasury, or a combination thereof. Any Shares

                                      -3-

<PAGE>

subject to an Option that cease to be subject thereto may again be the subject
of Options hereunder. Subject to adjustment in accordance with Section 3(b), no
Participant shall be granted in any calendar year Options to purchase more than
six hundred thousand (600,000) Shares solely for such time as the Company is
subject to Section 162(m) of the Code.

          (b) Changes in Company's Shares. In the event that any stock dividend,
              ---------------------------
extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination, exchange of shares, warrants or
rights offering to purchase Shares, or other similar corporate event, affects
the value of the Shares such that an adjustment is required in order to preserve
the benefits or potential benefits intended to be made available under this
Plan, the Board shall adjust any or all of (a) the number and kind of Shares
subject to outstanding Options, and (b) the exercise price with respect to any
Option or (c) make provision for a cash payment to any Participant or a person
who has an outstanding Option (in an amount equal to the then difference between
the exercise price and the Fair Market Value of a Share) in order to preserve
such benefits.

     4. Participation.
        -------------

          Each employee, officer and nonemployee director of, and each
consultant to, the Company shall be eligible to participate in the Plan,
provided that the Board shall have the discretion to determine who shall receive
a grant of Options hereunder and become a Participant.

     5. Terms of Options and Shares.
        ---------------------------

          (a) Terms. The Options granted hereunder shall have the following
              -----
terms and conditions:

               (i) Type of Option. The Board shall have the right to grant
                   --------------
either or both of Incentive Stock Options and Nonqualified Stock Options, which
characterization shall be set forth in the Option Agreement; provided, however,
that Incentive Stock Options shall only be granted to employees of the Company,
and provided further that no employee shall be granted Incentive Stock Options
which, when first exercisable during any calendar year (combined with all other
incentive stock option plans of the Company), will permit such employee to
purchase Shares that have an aggregate Fair Market Value (determined as of the
time the Option is granted) of more than $100,000 and any Option granted in
excess of such amount shall automatically be deemed to be a Nonqualified Stock
Option.

               (ii) Exercise Price. The exercise price of any Option shall be
                    --------------
one hundred percent (100%) of the Fair Market Value of a Share as of the date
the Option is granted; provided, however, that (1) the Board, in its sole
discretion, may grant Nonqualified Stock Options with an exercise price above or
below Fair Market Value, and (2) the exercise price of any incentive Stock
Option granted to a Ten Percent Shareholder shall be no less than one hundred
and ten percent (110%) of the Fair Market Value of a Share on the date of grant.
It is contemplated by the Company that each Company Share will have a value of
approximately nineteen dollars ($19.00) upon the occurrence of the effective
date of the Amended Joint Plan of Reorganization of Rotech Medical Corporation
and its Subsidiaries Under Chapter 11 of the

                                      -4-

<PAGE>

Bankruptcy Code filed by the Company with the United States District Court for
the District of Delaware on December 20, 2001.

               (iii) Term. Subject to the discretion of the Board, the term of
                     ----
an Option shall not exceed ten years (10) from the date it is granted; provided,
however, that in the case of Incentive Stock Options granted to a Ten Percent
Shareholder, the term of such Option shall not exceed five (5) years from the
date of grant.

               (iv) Vesting. An Option shall become exercisable (a) with respect
                    -------
to one-quarter (25%) of the original aggregate number of Shares purchasable upon
exercise of such Option on each of the first four anniversaries of the date it
is granted, (b) one-half (50%) to one hundred percent (100%) of the Shares under
such Option upon a Change in Control, such percentage to be determined at the
sole discretion of the Board, and (c) one-quarter (25%) of the original
aggregate number of Shares purchasable upon exercise of such Option upon the
consummation of an Initial Public Offering. (For purposes of illustration,
assuming a Participant were granted at the beginning of Year 1 an Option to
purchase one hundred thousand (100,000) Shares and at the end of Year 2 the
Company were to consummate an Initial Public Offering, such Option would vest
and become exercisable as follows: (x) twenty-five thousand (25,000) Shares at
the end of Year 1, (y) twenty-five thousand (25,000) Shares at the end of Year 2
(each as provided in clause (a) above) and (z) an additional twenty-five
thousand (25,000) Shares in Year 2 (as provided in clause (c) above). The
remaining twenty-five thousand (25,000) Shares would vest and become exercisable
at the end of Year 3 (as provided in clause (a) above)) Notwithstanding the
foregoing, in its sole discretion, the Board shall be entitled to substitute a
more accelerated vesting schedule at any time for any Participant.

               (v) Number. Subject to Section 5(a)(i), the Board shall have the
                   -----
discretion to determine the number of Options to be granted to any Participant,
and to determine the terms and conditions of any such grant, all as set forth in
the Option Agreement covering such ,Option.

          (b) (1) Termination of Service. A Participant who ceases to be an
                  ----------------------
employee, officer, nonemployee director or consultant for any reason other than
death, retirement on or after age 65, or Disability shall have forty-five (45)
calender days from the date of such cessation to exercise any then exercisable
Options, after which all such Options shall terminate and be of no further force
or effect; provided, that the Board may determine that the period of exercise
shall be any such other longer period in the Option Agreement. If a Participant
ceases to be an employee, officer, nonemployee director or a consultant due to
death, retirement on or after age 65, or Disability, all outstanding Options
held by such Participant that are exercisable on such date shall remain
exercisable for their term, and shall thereafter terminate and be of no further
force or effect. Any Options that are not exercisable at the time a Participant
ceases to be an employee, officer, director or consultant shall terminate at
such time and be of no further force or effect.

               (2) Puts and Calls Following Termination of Employment.
                   --------------------------------------------------
Notwithstanding anything herein to the contrary, so long as there has not been
an Initial Public Offering, in the event a Participant's employment terminates
because of death or Disability, the Participant or such Participant's estate, as
applicable, shall have the right for one (1) year after

                                      -5-

<PAGE>

such death or Disability to sell ("put") all (but not less than all) of his then
exercisable Options and Shares previously issued upon exercise of Options
("Option Shares") to the Company, and the Company shall be obligated to purchase
such Options and Option Shares for an amount in cash, check, or wire transfer
(in each case, after offsetting any amount the Participant is indebted to pay
the Company or any subsidiary as of such time), payable as promptly as possible
following such put, equal to the then Fair Market Value of any Shares (less the
exercise price per Option in the case of Options) for each such Option and
Option Shares. The Company shall have a corresponding privilege in the case of
the Participant's death or Disability, or in the event of his termination of
employment for any reason for the same one (1) year period to compel the
Participant to sell his Options and Option Shares at the same purchase price per
share indicated in the preceding sentence; provided, however, that, in the event
of termination for Cause, the purchase price shall be equal to the lesser of
Fair Market Value and the exercise price. The Company's obligation to honor any
put shall be subject to the Company being permitted to do so under applicable
law and the honoring of any put not violating or resulting in a default or event
of default under the Company's Senior Subordinated Notes due 2012 (or the
indenture under which they were issued) or under the Company's credit agreement
governing the Company's senior secured credit facilities (in either case as they
may be amended).

          (c) Option Agreement. Options shall be granted only pursuant to a
              ----------------
written Option Agreement, which shall be executed by the Participant and an
authorized officer of the Company, and which shall contain such terms and
conditions as the Board shall determine, consistent with the Plan. To the extent
an inconsistency exists between any term of any Option Agreement and any term of
the Plan, the Plan shall govern.

          (d) Nontransferability. No Option granted hereunder shall be
              ------------------
transferable by a Participant to whom granted other than by will or the laws of
descent and distribution, and an Option may be exercised during the lifetime of
such Participant only by a Participant or his guardian or legal representative,
provided, that a Participant may transfer Options that are not Incentive Stock
Options to his or her Immediate Family Members. The terms of such Option shall
be binding upon the Immediate Family Members, beneficiaries, executors,
administrators, heirs and successors of the Participant.

          (e) Method of Exercise. The exercise of an Option shall be made only
              ------------------

by delivery of a written notice (in person or by first class mail to the
Secretary of the Company at the Company's principal executive office) specifying
the number of Shares to be purchased and accompanied by full payment therefor
and otherwise in accordance with the Option Agreement pursuant to which the
Option was granted. The exercise price for any Shares purchased pursuant to the
exercise of an Option shall be paid in full upon such exercise (i) in cash, by
check or, (ii) at the discretion of the Board and upon such terms and conditions
as the Board shall approve, by surrender of Shares that were owned by the
Participant for at least six (6) months prior to the exercise of the Option (or
such longer or shorter period as may be required to not result in a charge to
earnings for financial accounting purposes), (iii) by directing the Company to
subtract from the number of Shares underlying the Option, that number of Shares
having a Fair Market Value equal to the purchase price (or portion thereof)
required to be paid upon such exercise, (iv) solely at a time when the Shares
are publicly-traded, pursuant to a "cashless exercise" of the Option pursuant to
the establishment of procedures whereby the Participant, by a properly executed
written notice, directs (A) an immediate market sale or margin loan respecting
all or a

                                      -6-

<PAGE>

part of the Shares to which he is entitled upon exercise pursuant to an
extension of credit by the Company to the Participant, (B) the delivery of the
Shares from the Company directly to a brokerage firm and (C) the delivery of the
Option price from sale or margin loan proceeds from the brokerage firm directly
to the Company, or (v) by any combination thereof. Any Shares transferred to
the Company as payment of the exercise price shall be valued at their Fair
Market Value on the day preceding the date of exercise of such Option. If
requested by the Board, the Participant shall deliver the Option Agreement
evidencing the Option to the Secretary of the Company who shall endorse thereon
a notation of such exercise and return such Option Agreement to the Participant.
Not less than one hundred (100) Shares may be purchased at any time upon the
exercise of an Option unless the number of Shares so purchased constitutes the
total number of Shares then purchasable under the Option or the Board determines
otherwise in its sole discretion.

          (f) Rights as Stockholder. No Participant shall be deemed for any
              ---------------------
purpose to be or to have the rights and privileges of the owner of any Shares
subject to any Option unless and until (a) the Option shall have been exercised
pursuant to the terms thereof, and (b) the Company shall have issued the Shares
to the Participant.

     6. Administration. The Plan shall be administered by the Board prior to an
        --------------
Initial Public Offering, and following such an Initial Public Offering, unless
and until the Board shall appoint a committee to administer the Plan. All
references to the "Committee" shall mean the Board if no such Committee has been
appointed. Subject to the provisions of the Plan, the Board shall be authorized
to select Participants, determine the type and number of Options, to interpret
and construe the Plan and the Option Agreements, to establish, amend, and
rescind any rules and regulations relating to the Plan, and to make all other
determinations necessary or advisable for the administration of the Plan and to
carry out its purpose. The determinations of the Board (or the Committee) in the
administration of the Plan, as described herein, shall be final, conclusive and
binding. The Secretary of the Company shall be authorized to implement the Plan
in accordance with its terms and to take such actions of a ministerial nature
as shall be necessary to effectuate the intent and purposes thereof.

     7. Other Provisions.
        ----------------

          (a) Effective Date; Grant Limitation. The Plan shall be effective as
              --------------------------------
of the date of effectiveness of the Company's Joint Plan of Reorganization filed
with the United States Bankruptcy Court for the District of Delaware (the
"Effective Date"). No Option to purchase Shares under the Plan shall be granted
to any Participant by the Board after the tenth (10th) anniversary of the
Effective Date.

          (b) Amendment, Suspension or Termination of the Plan. The Plan may be
              ------------------------------------------------
wholly or partially amended or otherwise modified, suspended or terminated at
any time or from time to time by the Board; provided, however, that, except as
provided in Section 3(b) and (d)(ii) of this Section 7, no amendment, suspension
nor termination shall, without the written consent of the Participant, alter or
impair any rights or obligations under any Option theretofore granted.

                                      -7-

<PAGE>

          (c) Governing Law. The Plan and the rights of all persons claiming
              -------------
hereunder shall be construed and determined in accordance with the laws of the
State of Delaware without giving effect to the conflicts of law principles
thereof.

          (d) Regulations and Other Approvals. (i) The obligation of the Company
              -------------------------------
to sell or deliver Shares with respect to Options granted under the Plan shall
be subject to all applicable laws, rules and regulations, including all
applicable federal and state securities laws, and the obtaining of all such
approvals by governmental agencies as may be deemed necessary or appropriate by
the Board.

               (ii) The Board may make such changes as may be necessary or
appropriate to comply with the rules and regulations of any government
authority.

               (iii) Each Option is subject to the requirement that, if at any
time the Board determines, in its sole discretion, that the listing,
registration or qualification of Shares issuable pursuant to the Plan is
required by any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Option or
the issuance of Shares, no Options shall be granted or payment made or Shares
issued, in whole or in part, unless listing, registration, qualification,
consent or approval has been effected or obtained free of any conditions as
acceptable to the Board.

               (iv) In the event that the disposition of Shares acquired
pursuant to the Plan is not covered by a then current registration statement
under the Securities Act of 1933, as amended (the "Securities Act"), and is
not otherwise exempt from such registration, such Shares shall be restricted
against transfer to the extent required by the Securities Act or regulations
there under, and the Board may require any individual receiving Shares pursuant
to the Plan, as a condition precedent to receipt of such Shares, to represent to
the Company in writing that the Shares acquired by such individual are acquired
for investment only and not with a view to distribution. The certificate
representing Shares shall include any legend that the Board deems appropriate to
reflect any restrictions on transfer.

          (e) Withholding of Taxes. As a condition to the exercise of an Option
              --------------------
and to the extent required by law, no later than the date as of which an amount
first becomes includible in the gross income of a Participant for federal income
tax purposes with respect to an Option granted under the Plan, the Participant
shall pay to the Company, or make arrangements satisfactory to the Company
regarding the payment of, any federal, estate, or local taxes of any kind
required by law to be withheld with respect to such amount. The obligations of
the Company under the Plan shall be conditioned on such payment or arrangements,
and the Company shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the Participant. In
its discretion, the Board may permit a Participant to satisfy withholding
obligations (i) by delivering previously owned Shares, (ii) by having Shares
withheld or (iii) by cash and any combination of the above.

          (f) Titles; Construction. Titles are provided herein for convenience
              --------------------
only and are not to serve as a basis for interpretation or construction of the
Plan. The masculine pronoun

                                      -8-

<PAGE>

shall include the feminine and neuter and the singular shall include the plural,
when the context so indicates.

                                      -9-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00044-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00044-of-00352.parquet"}]]