Document:

AMENDED AND RESTATED MANAGEMENT AGREEMENT
                 -----------------------------------------

     AMENDED AND RESTATED AGREEMENT (this "Agreement") made as of June 26,
2001 by and between NOVEON, INC., a Delaware corporation (the
"CORPORATION") and DLJ Merchant Banking III, Inc., a Delaware corporation
("DLJMB").

     WHEREAS, DLJMB Funding III, Inc., a Delaware corporation and an
affiliate of DLJMB ("FUNDING") is a party to the Stockholders Agreement
dated as of November 28, 2000 (as amended, the "STOCKHOLDERS AGREEMENT")
among PMD Group Holdings Inc., PMD Investors I LLC, PMD Investors II, Inc.,
Funding and DB Capital/PMD Investors, LLC;

     WHEREAS, pursuant to the Stockholders Agreement, Funding or other
affiliates of Credit Suisse Group designated by Funding shall be entitled
to receive certain fees as provided in Section 3.6 of the Stockholders
Agreement and Schedule 3.6 thereof;

     WHEREAS, DLJMB is the affiliate of Credit Suisse Group that Funding
designated to receive a portion of such fees as provided herein;

     WHEREAS, the Corporation and DLJMB are parties to a Management
Agreement dated as of February 5, 2001 (the "Original Agreement");

     WHEREAS, the parties wish to amend and restate the Original Agreement
to correct the names of the parties referenced in the Original Agreement,
replacing all references to DLJ Merchant Banking Partners III, L.P. with
DLJMB, and reflecting the change in the Corporation's name from PMD Group
Inc. to Noveon, Inc.;

     WHEREAS, the parties have agreed to enter into this agreement to
evidence the Corporation's obligations to pay such fees to DLJMB, upon the
terms and conditions set forth herein.

     NOW THEREFORE, it is mutually agreed as follows:

     1. The term of this agreement shall commence on November 28, 2000 and
continue for so long as provided in the Stockholders Agreement. As
compensation for the valuable services and advice to the Corporation to be
provided by the directors designated by DLJMB, Funding or any of their
respective affiliates pursuant to the Stockholders Agreement, and for
certain costs associated with the ongoing monitoring and management of the
investment in the Corporation, the Corporation will pay, and DLJMB will
accept, for so long as this Agreement continues in effect and for so long
as payment of interest and principal are being paid on a current basis on
the Corporation's senior subordinated notes, a director and monitoring fee
of $1,075,000 payable per annum quarterly in advance, on the first day of
each calendar quarter, commencing as of April 1, 2001. If at any time the
Corporation is not current with respect to payments of interest and
principal on its senior subordinated notes, no director and monitoring fee
shall be currently payable; rather, such fees shall accrue until such time
as the Corporation is current on such interest and principal payments, at
which time all accrued and unpaid fees hereunder shall be paid by the
Corporation. The Corporation also agrees to the provisions with respect to
indemnifying DLJMB and the other matters set forth in Annex A hereto, which
is incorporated by reference into this Agreement (the "INDEMNIFICATION
AGREEMENT").

     It is the understanding of the parties that DLJMB and/or its
affiliates may be involved with potential acquisitions, mergers, financings
or other major transactions involving the Corporation, in which case DLJMB
and/or its affiliates shall be entitled to such compensation, in addition
to the director and monitoring fee provided above, as the Corporation and
DLJMB and/or its affiliates shall mutually agree, in each case consistent
with the Stockholders Agreement.

     In addition to the aforementioned fees, the Corporation shall
reimburse DLJMB for its reasonable out-of-pocket costs and expenses
incurred in connection with the performance of the service provided
hereunder.

     2. Any notice required to be given hereunder shall be in writing and
shall be deemed sufficient if delivered in person or mailed by certified
mail as follows: if to the Corporation, to it at its office at Noveon,
Inc., 9911 Brecksville Road, Cleveland, Ohio 44141 or such other address as
the Corporation may hereafter designate for that purpose; and if to DLJMB,
to it at its office c/o DLJ Merchant Banking Partners, 277 Park Avenue, New
York, New York 10172, or such other address as DLJMB may hereafter
designate for that purpose.

     3. This Agreement, together with the Indemnification Agreement, the
Stockholders Agreement and a separate agreement providing for the payment
of $500,000 per annum to Credit Suisse First Boston Corporation for the
services provided thereunder, constitutes the entire agreement between the
parties and supersedes all prior agreements and understandings, both
written and oral, with respect to the subject matter hereof. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, including any corporation into
which the Corporation shall consolidate or merge or to which it shall
transfer substantially all of its assets. This Agreement shall be
governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed entirely within such
state.

     IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date and year first above written.

                                    NOVEON, INC.

                                    By:/s/ Christopher R. Clegg
                                      --------------------------------
                                      Name:   Christopher R. Clegg
                                      Title:  Secretary

                                    DLJ MERCHANT BANKING III, INC.

                                    By:/s/ Edward A. Poletti
                                      --------------------------------
                                      Name:   Edward A. Poletti
                                      Title:  Principal and Controller

AGREED TO AND
ACCEPTED BY:

DLJ MERCHANT BANKING
     PARTNERS III, L.P.

BY:   DLJ Merchant Banking III, Inc.,
      Its General Partner

By:/s/  Edward A. Poletti
   --------------------------------
   Name:   Edward A. Poletti
   Title:  Principal and Controller

<PAGE>
                    ANNEX A - INDEMNIFICATION AGREEMENT
                    -----------------------------------

     As part of the consideration for the agreement of DLJMB to furnish its
services under this Agreement, the Corporation hereby agrees to indemnify
and hold harmless DLJMB and its affiliates and the respective managing
directors, officers, directors, investors, shareholders, members, partners,
employees and agents of, and persons controlling, DLJMB or any of its
affiliates within the meaning of either Section 15 of the Securities Act
of 1933, as amended, or Section 20 of the Securities Act of 1934, as
amended, and each of their respective successors and assigns (collectively,
the "indemnified persons") from and against all claims, liabilities,
expenses, losses or damages (or actions in respect thereof) related to or
arising out of actions taken (or omitted to be taken) by DLJMB pursuant to
the terms of this Agreement, or DLJMB's role in connection therewith;
provided, however, that the Corporation shall not be responsible for any
claims, liabilities, expenses, losses and damages to the extent that it is
finally judicially determined that they result primarily from actions taken
or omitted to be taken by DLJMB in bad faith or due to DLJMB's gross
negligence or willful misconduct. If for any other reason (other than the
bad faith, gross negligence or willful misconduct of DLJMB as provided
above) the foregoing indemnity is unavailable to the indemnified persons or
insufficient to hold the indemnified persons harmless, then the Corporation
shall contribute to the amount paid or payable by the indemnified persons
as a result of such claim, liability, expense, loss or damage in such
proportion as is appropriate to reflect not only the relative benefits
received by the Corporation on the one hand and DLJMB on the other, but
also the relative fault of the Corporation and DLJMB, as well as any
relative equitable considerations, subject to the limitation that in any
event DLJMB's aggregate contribution to all claims, expenses, losses,
liability and damages shall not exceed the amount of fees actually received
by DLJMB pursuant to this Agreement. Promptly after receipt by DLJMB of
notice of any complaint or the commencement of any action or proceeding
with respect to which indemnification may be sought against the
Corporation, DLJMB will notify the Corporation in writing of the receipt or
commencement thereof, but failure to notify the Corporation will relieve
the Corporation from any liability which it may have hereunder only if, and
to the extent that, such failure results in the forfeiture of such
substantial rights and defenses, and will not in any event relieve the
Corporation from any other obligation to any indemnified person other than
this Indemnification Agreement. The Corporation shall assume the defense of
such action (including payment of fees and disbursements of counsel)
insofar as such action shall relate to any alleged liability in respect of
which indemnity may be sought against the Corporation. DLJMB shall have the
right to employ separate counsel in any such action and to participate in
defense thereof, but the fees and disbursements of such counsel shall be at
the expense of DLJMB unless employment of such counsel has been
specifically authorized by the Chief Executive Officer of the Corporation
in writing. The Corporation shall pay the fees and expenses of one separate
counsel for DLJMB and any other indemnified persons if the named parties to
any such action (including any impleaded parties) include the Corporation
(or any of the directors of the Corporation) and DLJMB and (i) in the good
faith judgment of DLJMB the use of joint counsel would present such counsel
with an actual or potential conflict of interest or (ii) DLJMB shall have
been advised by counsel that there may be one or more legal defenses
available to it which are different from or additional to those available
to the Corporation (or the director(s)). The Corporation shall not be
liable to indemnify any person for any settlement of any claim or action
effected without written consent of the Chief Executive Officer of the
Corporation, which consent shall not be unreasonably withheld. In addition,
the Corporation hereby agrees to reimburse DLJMB and each other indemnified
person for all expenses (including reasonable fees and disbursements of
counsel if the Corporation does not assume the defense of such action) as
they are incurred by DLJMB, or any indemnified person in connection with
investigating, preparing or defending any such action or claim. DLJMB shall
have no liability to the Corporation or any other person in connection with
the services which they render pursuant to this Agreement, except for
DLJMB's bad faith, gross negligence or willful misconduct judicially
determined as aforesaid. The indemnification, contribution and expense
reimbursement obligation the Corporation has under this paragraph shall be
in addition to any liability the Corporation may otherwise have. ANY RIGHT
TO TRIAL BY JURY WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING IN
CONNECTION WITH OR AS A RESULT OF EITHER DLJMB'S ENGAGEMENT OR ANY MATTER
REFERRED TO IN THIS AGREEMENT IS HEREBY WAIVED BY THE PARTIES HERETO. THE
PROVISIONS OF THIS ANNEX A SHALL SURVIVE ANY TERMINATION OR COMPLETION OF
THE ENGAGEMENT PROVIDED BY THIS AGREEMENT.EXHIBIT 10.8

                           NOVEON HOLDINGS, INC.

                     (FORMERLY PMD GROUP HOLDINGS INC.)

                   AMENDED AND RESTATED STOCK OPTION PLAN

                                 ARTICLE 1

                                  GENERAL

          1.1 Purpose.  The purpose of this Noveon  Holdings,  Inc. Amended
and  Restated  Stock Option Plan (the "Plan") is to provide for certain key
employees,  consultants  and/or  directors  of  Noveon  Holdings,  Inc.,  a
Delaware corporation (the "Company"),  and its subsidiaries and affiliates,
an  incentive  (i) to join and/or  remain in the service of the Company and
its subsidiaries and affiliates, (ii) to maintain and enhance the long-term
performance  and  profitability  of the  Company and its  subsidiaries  and
affiliates  and (iii) to acquire a  proprietary  interest in the success of
the Company and its subsidiaries and affiliates.

          1.2 Definition of Certain Terms.

               (a)  "Agreement"  means  an  agreement  issued  pursuant  to
Section 2.1.

               (b) "Board" means the Board of Directors of the Company.

               (c)  "Code"  means the  Internal  Revenue  Code of 1986,  as
amended.

               (d) "Committee" means the Committee  appointed to administer
the Plan in accordance with Section 1.3.

               (e)  "Company"  means  Noveon  Holdings,  Inc.,  a  Delaware
corporation.

               (f) "Common  Stock" means the shares of common  stock,  $.01
par value, of the Company and any other shares into which such common stock
shall  thereafter  be  exchanged by reason of a  recapitalization,  merger,
consolidation, split-up, combination, exchange of shares or the like.

               (g) "IPO" means an initial  underwritten  public offering of
the Common Stock  registered  under the Securities Act of 1933, as amended,
whether  for the  sale of  shares  of  Common  Stock by the  Company  or by
shareholders.

               (h) "Optionee" means an employee, consultant and/or director
of the  Company  or any of its  subsidiaries  or  affiliates  who has  been
awarded any Option under this Plan.

               (i)  "Option"  means  a  "nonqualified"   stock  option,  as
described in Section 1.5, granted under the Plan.

               (j) "Plan"  means this  Noveon  Holdings,  Inc.  Amended and
Restated Stock Option Plan.

               (k) "Termination  With Cause," with respect to any Optionee,
means,  unless  otherwise set forth in an Option Agreement or an employment
or similar  agreement  between the Company and an Optionee,  termination by
the Company or any of its  subsidiaries  or affiliates  of such  Optionee's
employment  for:  (i)   misappropriation   of  any  significant  monies  or
significant  assets or  properties of the Company or any  subsidiary,  (ii)
commission  of a  felony  or  a  crime  involving  moral  turpitude,  (iii)
substantial  and repeated  failure to comply with  directions  of the Chief
Executive  Officer of the Company or other  superior of the Optionee or the
Board of Directors of the Company or any of its subsidiaries or affiliates,
(iv) gross negligence or willful misconduct, (v) chronic alcoholism or drug
addiction together with Optionee's refusal to cooperate with or participate
in  counseling  and/or  treatment  of same or (vi) any  willful  action  or
inaction of the Optionee  which,  in the  reasonable  opinion of the Board,
constitutes dereliction (willful neglect or willful abandonment of assigned
duties),  or a material  breach of Company  or  subsidiary  policy or rules
which, if susceptible to cure, is not cured by the Optionee within five (5)
days  following the  Optionee's  receipt of written notice from the Company
advising  the  Optionee  with  reasonable  specificity  as to the action or
inaction  viewed  by the  Company  or  subsidiary  to be  dereliction  or a
material breach of Company or subsidiary policy or rules.

          1.3 Administration.

               (a)   Subject   to  Section   1.3(e),   the  Plan  shall  be
administered  by a committee  of the Board which shall  consist of at least
two  directors  and which  shall  have the power of the Board to  authorize
awards under the Plan. The members of the Committee  shall be appointed by,
and may be changed from time to time in the discretion of, the Board.

               (b) The  Committee  shall have the authority (i) to exercise
all of the powers granted to it under the Plan, (ii) to construe, interpret
and implement the Plan and any Agreement  executed  pursuant to Section 2.1
in accordance with the terms thereof, (iii) to prescribe, amend and rescind
rules and regulations relating to the Plan, (iv) to make all determinations
necessary  or  advisable  in  administering  the Plan,  (v) to correct  any
defect,  supply any omission and reconcile any  inconsistency  in the Plan,
and (vi) to grant Options on such terms, not inconsistent with the Plan, as
it shall determine.

               (c)  The  determination  of the  Committee  on  all  matters
relating to the Plan or any Agreement shall be conclusive.

               (d) No  member  of the  Committee  shall be  liable  for any
action or determination  made in good faith with respect to the Plan or any
award thereunder.

               (e)  Notwithstanding  anything  to  the  contrary  contained
herein: (i) until the Board shall appoint the members of the Committee, the
Plan shall be  administered  by the Board;  and (ii) the Board may,  in its
sole discretion,  at any time and from time to time,  resolve to administer
the Plan. In either of the foregoing  events,  the term "Committee" as used
herein shall be deemed to mean the Board.

               (f)  Notwithstanding  anything in the Plan to the  contrary,
with respect to any Optionee or eligible person who is resident  outside of
the United  States,  the Committee may, in its sole  discretion,  amend the
terms of the Plan in order to conform such terms with the  requirements  of
local law or to meet the  objectives of the Plan.  The Committee may, where
appropriate, establish one or more sub-plans for this purpose.

          1.4 Persons  Eligible  for Awards.  Awards  under the Plan may be
made from time to time to such key employees,  consultants and/or directors
of the Company or its subsidiaries and/or affiliates as the Committee shall
in its sole discretion select.

          1.5 Types of Awards Under the Plan.  Awards may be made under the
Plan in the form of stock  options,  which  shall be  "nonqualified"  stock
options  subject to the  provisions of section 83 of the Code,  all as more
fully set forth in Article 2.

          1.6 Shares Available for Awards.

               (a) Subject to Section 3.4  (relating  to  adjustments  upon
changes in  capitalization),  the maximum  number of shares of Common Stock
with respect to which  Options may be awarded under the Plan shall be equal
to 394,444 shares.  Shares of Common Stock covered by Options granted under
the Plan which  expire or  terminate  for any  reason  shall  again  become
available for award under the Plan.

               (b) Shares  that are  issued  upon the  exercise  of Options
awarded under the Plan shall be authorized and unissued or treasury  shares
of Common Stock.

               (c)  Without   limiting  the  generality  of  the  preceding
provisions  of this  Section 1.6,  the  Committee  may, but solely with the
Optionee's consent, agree to cancel any award of Options under the Plan and
issue new Options in substitution therefor, provided that the Options as so
substituted  shall  satisfy all of the  requirements  of the Plan as of the
date such new Options are awarded.

<PAGE>

                                 ARTICLE 2

                               STOCK OPTIONS

          2.1 Agreements Evidencing Stock Options

               (a) Options  awarded  under the Plan shall be  evidenced  by
Agreements which shall not be inconsistent with the terms and provisions of
the Plan,  and which shall contain such  provisions as the Committee may in
its sole  discretion  deem  necessary or  desirable.  Without  limiting the
generality of the foregoing, the Committee may in any Agreement impose such
restrictions  or conditions upon the exercise of an Option or upon the sale
or other  disposition  of the shares of Common Stock issuable upon exercise
of an Option as the  Committee  may in its sole  discretion  determine.  By
accepting an award  pursuant to the Plan each Optionee  shall thereby agree
that each such award and shares of Common Stock  acquired  upon exercise of
an Option shall be subject to all of the terms and  provisions of the Plan,
including, but not limited to, the provisions of Section 1.3(d).

               (b) Each  Agreement  shall set forth the number of shares of
Common Stock subject to the Option granted thereby.

               (c) Each  Agreement  relating to Options shall set forth the
amount  payable by the Optionee to the Company upon  exercise of the Option
evidenced thereby. Unless otherwise determined by the Committee, the Option
exercise  price per share of Common  Stock  shall be not less than the fair
market  value  of the  Common  Stock  on the  date of  grant,  adjusted  as
determined  by the  Committee  to  reflect  changes  in  capitalization  as
contemplated by Section 3.4.

          2.2 Term of Options.  Each  Agreement  shall set forth the period
during which the Option evidenced thereby shall be exercisable,  whether in
whole or in part,  such periods to be  determined  by the  Committee in its
discretion.

          2.3  Exercise  of  Options.  Subject  to the  provisions  of this
Article  2, each  Option  granted  under the Plan shall be  exercisable  as
follows:

               (a) An Option  shall  become  exercisable  at such times and
subject to such  conditions as the  applicable  Agreement may provide or as
subsequently determined by the Committee.

               (b) Unless the applicable  Agreement otherwise provides,  an
Option  granted under the Plan may be exercised from time to time as to all
or part of the shares as to which such Option shall then be exercisable.

               (c) An  Option  shall  be  exercisable  by the  filing  of a
written  notice  of  exercise  with the  Company,  on such form and in such
manner as the Committee shall in its sole discretion prescribe.

               (d) Unless the applicable Agreement otherwise provides,  any
written  notice of exercise of an Option shall be accompanied by payment of
the exercise  price for the shares being  purchased.  Such payment shall be
made by  certified  or official  bank check  payable to the Company (or the
equivalent  thereof  as may  be  set  forth  in an  Agreement  or as may be
acceptable to the Committee).  Subject to Section 3.10 of the Plan, as soon
as practicable  after receipt of such payment and the  satisfaction  of the
withholding  taxes referred to in Section 3.3, the Company shall deliver to
the Optionee a certificate or  certificates  for the shares of Common Stock
so purchased.

          2.4 Termination of Options.

               (a)  Notwithstanding  anything to the contrary in this Plan,
except as the Agreement or the  Committee  may otherwise  provide or as set
forth in Section 2.4(b) or Section  2.4(d),  Options granted to an Optionee
(and  already  vested but not yet  exercised)  shall  terminate on the date
which is forty-five (45) days after  termination of his employment with the
Company  for any reason  (other  than by reason of death or  disability  in
which case the  Options  shall  terminate  on the date which is one hundred
eighty (180) days after the date of such termination).

               (b)  Notwithstanding  anything to the contrary in this Plan,
unless  otherwise  determined  by  the  Committee  or as  set  forth  in an
Agreement,  all Options granted to an Optionee (whether vested or unvested)
shall immediately expire and cease to be exercisable and all rights granted
to an  Optionee  under  this  Plan  and  such  Optionee's  Agreement  shall
immediately expire in the event of a Termination With Cause of the Optionee
by the Company at any time.

               (c)  Unless  the  applicable  Agreement  expressly  provides
otherwise, Options awarded to Optionees under the terms of the Plan will be
exercisable only in accordance with the following vesting schedule:

                                                         Cumulative
                                                         Percentage of
                  Applicable Date                        Total Shares
                  ---------------                        -------------

       On the first anniversary of the date of
       the Agreement                                          20%
       On the second anniversary of the date of
       the Agreement                                          40%
       On the third anniversary of the date of
       the Agreement                                          60%
       On the fourth anniversary of the date of
       the Agreement                                          80%
       On the fifth anniversary of the date of
       the Agreement                                         100%

The Committee may modify this vesting  schedule in any manner that it deems
appropriate  in any  Agreement  or  otherwise,  and may  provide  different
vesting schedules in different Agreements in its sole discretion. Except as
the  Committee  may  otherwise  provide  or as  otherwise  set  forth in an
Agreement,  in the event that  Optionee's  employment  with the  Company is
terminated for any reason prior to the date on which the  Optionee's  right
to exercise the Options has fully vested  pursuant to this Section  2.4(c),
the  unvested  portion  of  the  Options  will  immediately   cease  to  be
exercisable. The Committee may accelerate the vesting of any Options at any
time.

               (d)  Unless  otherwise  set  forth  in  an  Agreement  or as
determined by the  Committee,  in the event that an  Optionee's  employment
with the Company is terminated for any reason  (including,  but not limited
to, death or  disability),  if at the time of such  termination  the Common
Stock  is  not  publicly  traded  on  a  national  securities  exchange  or
over-the-counter market, the Company shall have the right, at its election,
on giving ten days written  notice to such Optionee to  repurchase  any and
all shares of Common Stock  acquired  upon exercise of Options owned at the
time of such termination by such Optionee, as well as any and all shares of
Common Stock  acquired  upon  exercise of Options owned by such Optionee at
the  time of  such  termination  which  are,  or in  connection  with  such
termination  become,  vested. Such repurchase right may be exercised by the
Company  at any time  after the  shares of Common  Stock have been owned of
record by the Optionee for at least six months.  The purchase price payable
by the Company to the Optionee on exercise of its right to repurchase  will
be: (A) in the event such  termination  is a  Termination  With Cause,  the
lesser  of the  fair  market  value  of the  Common  Stock  which  is being
repurchased, determined as of the date of the repurchase, or the price paid
by the Optionee;  or (B) in the event such  termination is by such Optionee
or by the Company  without Cause or by reason of death or  disability,  the
greater of the fair market  value of the Common  Stock held by the Optionee
which is being repurchased, determined as of the date of the repurchase, or
the price paid by the Optionee. The fair market value will be determined by
the Board in its absolute discretion,  unless otherwise expressly set forth
in the applicable Agreement.

               (e)  Unless  otherwise  set  forth  in  an  Agreement  or as
determined by the Committee,  in the event of a Non-Control Transaction (as
hereinafter defined),  (A) all outstanding Options shall remain outstanding
and  subject  to the  terms  and  conditions  of the Plan  and the  related
Agreements, including the vesting schedule contained in Section 2.4(c), and
(B) each Optionee  shall be entitled to receive in respect of each share of
Common Stock subject to the Option,  upon exercise of such Option after the
vesting  thereof,  the same  amount  and kind of stock,  securities,  cash,
property or other consideration that each holder of a share of Common Stock
was  entitled  to receive in the  Non-Control  Transaction  in respect of a
share.  Unless  otherwise set forth in an Agreement or as determined by the
Committee,  in the event of a Transaction (as hereinafter defined),  50% of
the outstanding  Options that have not then vested  ("Outstanding  Unvested
Options")  held by each Optionee  then actively  employed by the Company or
any of its subsidiaries or affiliates shall immediately vest on the date of
consummation of the Transaction  (the  "Transaction  Date").  Any remaining
Outstanding  Unvested  Options held by an Optionee shall  immediately  vest
upon: (i) the first anniversary of the Transaction Date, if the Optionee is
actively  employed by the Company or any of its  subsidiaries or affiliates
on  such  first  anniversary,  or  (ii)  the  date  of  termination  of the
Optionee's  employment,  if  the  Optionee's  employment  is  involuntarily
terminated  (other than a Termination  With Cause) between the  Transaction
Date and the first  anniversary  thereof.  For  purposes  of the  preceding
sentence,   an  Optionee's   employment   shall  be  deemed  to  have  been
involuntarily  terminated if the Optionee voluntarily terminates his or her
employment  promptly  following a material reduction in such Optionee's (i)
duties, title, or responsibilities or (ii) base salary, in either case from
that in effect immediately prior to the Transaction; provided, that for the
avoidance of doubt, a change in title, duties or  responsibilities  that is
inherent in the fact of the occurrence of the Transaction, such as a change
in  title or  reporting  responsibilities  that  merely  reflects  that the
Company is owned by another entity, will not by itself be deemed a material
reduction for purposes of this sentence.

               Notwithstanding the foregoing, in the event of a Transaction
or a  Non-Control  Transaction,  outstanding  Options may, in the Company's
sole discretion and without the consent of the Optionee,  be converted into
or exchanged for substantially equivalent options to purchase shares of the
surviving corporation. In addition, as of the Transaction Date, the Company
shall also have the right to cancel any or all Options  which have not been
exercised  as of  the  Transaction  Date,  subject  to the  payment  of the
purchase price described  below.  The purchase price payable by the Company
to the Optionee upon the  cancellation of each  unexercised  Option will be
the aggregate  fair market value of the Common Stock  underlying  each such
Option  determined as of the Transaction  Date less the aggregate  exercise
price of each such Option. The fair market value will be determined in good
faith by the Board  based on the value  being  paid to or  received  by the
holders  of Common  Stock in such  Transaction  for their  shares of Common
Stock.

               Unless  otherwise  provided in an Agreement or as determined
by the  Committee,  "Transaction"  means (i) the  approval  by  partners or
stockholders of the liquidation or dissolution of the Company,  (ii) a sale
or other disposition of 51% or more of the outstanding  interests or voting
stock,  respectively,  of the Company, (iii) the merger or consolidation of
the Company with or into any entity, or (iv) a sale or other disposition of
substantially all of the assets of the Company; provided, however, that the
term  "Transaction"  shall exclude each transaction which is a "Non-Control
Transaction." Unless otherwise provided in an Agreement or as determined by
the Committee, the term "Non-Control Transaction" means (i) any transaction
following   which  either  (A)  AEA  Investors  Inc.   ("AEA")  and/or  its
affiliates,  participants,  investors and/or employees (collectively,  "AEA
Entities"), or (B) DLJMB Funding III, Inc. ("DLJMB") and/or its affiliates,
participants,   investors,   related   investment  funds  and/or  employees
(collectively, "DLJMB Entities"), have not suffered a material reduction in
percentage  voting ownership from that in effect as of February 28, 2001 of
the Company or any successor thereto (disregarding any reduction due to the
grant or exercise of any Options or other stock-based  compensatory  awards
to  employees,  consultants  or  directors  of  the  Company  or any of its
affiliates); (ii) there is, after the transaction, no other person or group
who owns a greater  percentage  of voting  control over the  purchasing  or
surviving  entity than the AEA Entities or DLJMB  Entities;  provided that,
for purposes of this clause,  any  transferee of  substantially  all of the
interests  in the  Company  held by either  the AEA  Entities  or the DLJMB
Entities shall itself be considered to be an AEA Entity or DLJMB Entity, as
applicable;  but provided  further,  that the  foregoing  proviso  shall be
applied  only as to one of either the AEA  Entities or DLJMB  Entities,  so
that, for example,  if any person acquires  substantially all the interests
in the Company held by AEA Entities,  and any person subsequently  acquires
substantially  all the interests in the Company held by the DLJMB Entities,
such  subsequent  person  shall  not be  deemed  to be a DLJMB  Entity  for
purposes of this clause;  (iii) a merger or  consolidation  following which
those  persons  who  owned   directly  or  indirectly  a  majority  of  the
outstanding  interests or shares of voting stock of PMD  Investors I LP and
PMD  Investors  II LP  (collectively  "PMD") and DLJMB  and/or the  Company
immediately  prior to such  merger or  consolidation  will own  directly or
indirectly  a majority  of the  outstanding  interests  or shares of voting
stock of the surviving  corporation;  (iv) a sale or other  disposition  of
interests or capital stock,  respectively,  of the Company  following which
those  persons  who  owned   directly  or  indirectly  a  majority  of  the
outstanding  interests or shares of voting stock  immediately prior to such
sale  will  own  directly  or  indirectly  a  majority  of the  outstanding
interests or shares of voting stock of the purchasing entity; (v) a sale or
other  disposition of substantially  all of the assets of the Company to an
AEA Entity,  a DLJMB Entity or an affiliate of the Company;  (vi) an IPO of
the Company or (vii) any transaction  following which any of the following,
alone or in  combination,  constitute  a majority of the  directors  of the
Board or have a right to elect a majority of the Board:  PMD, DLJMB, an AEA
Entity, DLJMB Entity or any officers, directors,  employees,  participants,
shareholders  or agents of an AEA Entity or DLJMB Entity or partners of PMD
or a DLJMB Entity.

                                 ARTICLE 3

                               MISCELLANEOUS

          3.1 Amendment of the Plan; Modification of Awards.

               (a) The Board may, without stockholder  approval,  from time
to time  suspend  or  discontinue  the  Plan or  revise  or amend it in any
respect  whatsoever,  except  that  no  such  suspension,   discontinuance,
revision  or  amendment  shall  adversely  alter or  impair  any  rights or
obligations  under any award  theretofore  made under the Plan  without the
consent of the person to whom such award was made.

               (b) With the  consent  of the  Optionee  and  subject to the
terms and conditions of the Plan (including Section 3.1(a)),  the Committee
may amend outstanding  Agreements with such Optionee,  for example,  to (i)
accelerate  the time or times at which an Option may be  exercised  or (ii)
extend the scheduled expiration date of the Option.

          3.2  Nonassignability.  Unless otherwise provided in an Agreement
or as determined by the  Committee,  no right granted to any Optionee under
the Plan or under any Agreement shall be assignable or  transferable  other
than by will or by the laws of descent and  distribution.  Unless otherwise
determined by the  Committee,  during the life of the Optionee,  all rights
granted  to the  Optionee  under the Plan or under any  Agreement  shall be
exercisable only by him.

          3.3  Withholding  of Taxes.  The  Company  shall be  entitled  to
withhold  an amount  sufficient  to satisfy  any  federal,  state and other
governmental tax  requirements  related to an Option.  Whenever,  under the
Plan,  shares  of Common  Stock are to be  delivered  upon  exercise  of an
Option, the Company shall be entitled to require as a condition of delivery
that the Optionee remit an amount sufficient to satisfy all federal,  state
and other governmental tax withholding  requirements related thereto, which
may,  in  the  sole  discretion  of  the  Committee,  include  delivery  or
withholding of shares of Common Stock.

          3.4  Adjustments  Upon  Changes  in  Capitalization.   Except  as
otherwise  provided in an Agreement,  if and to the extent specified by the
Committee,  the  exercise  price for  Options  and the  number of shares of
Common Stock or other property which may be issued pursuant to the exercise
of  Options  granted  under the Plan  shall be  automatically  adjusted  to
reflect any stock  splits,  reverse  stock splits or dividends  paid in the
form of Common Stock and equitably  adjusted as determined by the Committee
to be appropriate  and reasonable for any other increase or decrease in the
number of issued shares of Common Stock  resulting from the  subdivision or
combination of shares of Common Stock or other capital adjustments,  or the
payment of any other stock dividend or other  extraordinary  dividend after
the  effective  date of this Plan,  or other  increase  or  decrease in the
number of such shares of Common Stock or any substantial sale of the assets
of the Company; provided, however, that, unless otherwise determined by the
Committee,  any  Options  to  purchase  fractional  shares of Common  Stock
resulting from any such adjustment shall be eliminated.  Adjustments  under
this Section 3.4 shall be made by the Committee,  whose determination as to
what  adjustments  shall be made, and the extent  thereof,  shall be final,
binding and conclusive.

          3.5 Right of Discharge  Reserved.  Nothing in this Plan or in any
Agreement  shall  confer  upon any  employee  or other  person the right to
continue  in  the  employment  or  service  of  the  Company  or any of its
subsidiaries  or affiliates or affect any right which the Company or any of
its  subsidiaries  or affiliates  may have to terminate  the  employment or
service of such employee or other person.

          3.6 No Rights  as a  Stockholder.  No  Optionee  or other  person
holding  an Option  shall have any of the  rights of a  stockholder  of the
Company with respect to shares subject to an Option until the issuance of a
stock certificate to him for such shares.  Except as otherwise  provided in
Section 3.4, no adjustment  shall be made for dividends,  distributions  or
other  rights  (whether  ordinary  or  extraordinary,  and whether in cash,
securities  or other  property)  for which the record  date is prior to the
date such stock certificate is issued.

          3.7 Nature of Payments.

               (a) Any and all  payments of shares of Common  Stock or cash
hereunder  shall  be  granted,  transferred  or  paid in  consideration  of
services  performed  by  the  Optionee  for  the  Company  or  any  of  its
subsidiaries or affiliates.

               (b) All such grants, issuances and payments shall constitute
a special incentive payment to the Optionee and shall not, unless otherwise
determined by the Committee,  be taken into account in computing the amount
of salary or  compensation  of the Optionee for the purposes of determining
any pension,  retirement,  death or other  benefits  under (i) any pension,
retirement,  life  insurance or other benefit plan of the Company or any of
its subsidiaries or affiliates or (ii) any agreement between the Company or
any of its subsidiaries or affiliates and the Optionee.

          3.8 Non-Uniform Determinations.

               The  Committee's  determinations  under the Plan need not be
uniform and may be made by it selectively among persons who receive, or are
eligible to receive, awards under the Plan (whether or not such persons are
similarly situated).  Without limiting the generality of the foregoing, the
Committee shall be entitled,  among other things,  to make  non-uniform and
selective  determinations,  and to enter  into  non-uniform  and  selective
Agreements,  as to (i) the persons to receive  awards under the Plan,  (ii)
the terms and  provisions of awards under the Plan, and (iii) the treatment
of awards under the Plan pursuant to Section 3.4.

          3.9 Other Payments or Awards. Nothing contained in the Plan shall
be  deemed  in any way to  limit  or  restrict  the  Company  or any of its
subsidiaries  or  affiliates  or the  Committee  from  making  any award or
payment to any person under any other plan,  arrangement or  understanding,
whether now existing or hereafter in effect.

          3.10 Restrictions.

               (a) If the Committee  shall at any time  determine  that any
Consent (as  hereinafter  defined) is necessary or desirable as a condition
of, or in connection  with,  the granting of any award under the Plan,  the
issuance or purchase of shares or the exercise of other rights hereunder or
the  taking  of  any  other  action   hereunder  (each  such  action  being
hereinafter  referred to as a "Plan  Action"),  then such Plan Action shall
not be taken, in whole or in part, unless and until such Consent shall have
been  effected  or  obtained  to the full  satisfaction  of the  Committee.
Without  limiting the generality of the foregoing,  if (i) the Committee is
entitled under the Plan to make any payment in cash,  Common Stock or both,
and (ii) the Committee  determines that a Consent is necessary or desirable
as a condition  of, or in  connection  with,  payment in any one or more of
such forms,  the  Committee  shall be entitled to determine not to make any
payment  whatsoever  until such  Consent  shall have been  obtained  in the
manner aforesaid.  In such event, the Committee will use reasonable efforts
to obtain such Consent.

               (b) The term  "Consent"  as used herein with  respect to any
Plan Action means (i) any and all listings,  registrations,  qualifications
or similar  requirements in respect thereof upon any securities exchange or
under any federal, state or local law, rule or regulation, (ii) any and all
written  agreements and  representations by the grantee with respect to the
disposition  of  shares,  or with  respect to any other  matter,  which the
Committee shall deem necessary or desirable to comply with the terms of any
such listing,  registration,  qualification  or similar  requirement  or to
obtain  an  exemption   from  the   requirement   that  any  such  listing,
qualification  or  registration  be made and  (iii)  any and all  consents,
clearances and approvals in respect of a Plan Action by any governmental or
other regulatory bodies.

          3.11 This Plan and the agreements entered into hereunder shall be
governed  by and  construed  in  accordance  with the laws of the  State of
Delaware without regard to its rules of conflict of laws.

          3.12 Section Headings.  The section headings contained herein are
for the  purposes  of  convenience  only and are not  intended to define or
limit the contents of said sections.

          3.13 Effective Date and Term of Plan.

               (a) This Plan shall be deemed  adopted and become  effective
upon the approval thereof by the Board.

               (b)  Subject  to  Section  3.1(a)  hereof,  the  Plan  shall
terminate  10 years  after the date on which it becomes  effective,  and no
awards  shall  thereafter  be made  under  the  Plan.  Notwithstanding  the
foregoing,  all  awards  made under the Plan prior to the date on which the
Plan  terminates  shall  remain  in  effect  until  such  awards  have been
satisfied or terminated in accordance  with the terms and provisions of the
Plan.

Adopted as of this 31st day of October, 2001.

By /s/ Christopher R. Clegg
  ----------------------------------------
Title:  Christopher R. Clegg, Senior
             Vice President and Secretary

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