Document:

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                                                                    EXHIBIT 10.5

                               W. R. GRACE & CO.
                (formerly named Grace Specialty Chemicals, Inc.)

                   1998 STOCK PLAN FOR NONEMPLOYEE DIRECTORS

         1. Purposes. The purposes of this Plan are (a) to enable the Company to
attract and retain the most highly qualified individuals to serve as Nonemployee
Directors, (b) to link the compensation of Nonemployee Directors to the
performance of the Common Stock, and (c) to unite the interests of Nonemployee
Directors with those of the Company's shareholders.

         2. Definitions. When used in this Plan, the following terms shall have
the meanings set forth in this section 2.

         Board of Directors: The Board of Directors of the Company.

         Common Stock: The common stock of the Company, par value $.01 per
share, or such other class of shares or other securities or property as may be
applicable pursuant to the provisions of section 7.

         Company: W. R. Grace & Co., a Delaware corporation formerly named Grace
Specialty Chemicals, Inc.

         Fair Market Value: (a) The mean between the high and low sales prices
of a share of Common Stock in New York Stock Exchange composite transactions for
the applicable date, as reported in The Wall Street Journal or another newspaper
of general circulation, or, if no sales of shares of Common Stock were reported
for such date, for the next preceding date for which such sales were so
reported, or (b) the fair market value of a share of Common Stock determined in
accordance with any other reasonable method.

         Fee: A fee for attendance by a Nonemployee Director at a meeting of the
Board of Directors or a committee thereof.

         issuance (or words of similar import): (a) The issuance of authorized
but unissued Common Stock, (b) the transfer of issued Common Stock held by the
Company or a Subsidiary, or (c) the delivery of Common Stock purchased for use
under this Plan by an agent independent of the Company.

         Nonemployee Director: An individual who is (or was) a director of the
Company and who is (or was) not employed by the Company or a Subsidiary while
serving as a director of the Company.

<PAGE>

         Plan: The 1998 Stock Plan for Nonemployee Directors herein set forth,
as the same may from time to time be amended.

         Retainer: An annual retainer for service as a Nonemployee Director or
for service as the chair of a committee of the Board of Directors.

         service: Service as a Nonemployee Director. "To serve" has a
correlative meaning.

         Service Period: A calendar year, or any other period designated by the
Board of Directors, in respect of which a Nonemployee Director is to receive a
Retainer and/or Fees.

         Subsidiary: A corporation (or other form of business association) of
which shares (or other ownership interests) having 50% or more of the voting
power regularly entitled to vote for directors (or equivalent management rights)
are owned, directly or indirectly, by the Company.

         3. Eligibility and Participation. All Nonemployee Directors are
eligible to participate in the Plan. Each Nonemployee Director will participate
as described in section 5.

         4. Stock Subject to this Plan.

         (a) Subject to the provisions of paragraphs (b) and (c) of this section
4 and the provisions of section 7, the maximum number of shares of Common Stock
that may be issued under this Plan shall be One Hundred Fifty Thousand (150,000)
shares of Common Stock.

         (b) Authorized but unissued shares of Common Stock and issued shares of
Common Stock held by the Company or a Subsidiary, whether acquired specifically
for use under this Plan or otherwise, may be used for purposes of this Plan. In
addition, shares of outstanding Common Stock purchased by an agent independent
of the Company may be used under this Plan, in which case such shares shall be
deemed issued under this Plan for purposes of paragraph (a) of this section 4.

         (c) If any shares of Common Stock issued pursuant to this Plan shall,
after issuance, be reacquired by the Company or a Subsidiary from the recipient
of such Common Stock, or from the estate of such recipient, for any reason, such
shares shall no longer be charged against the limitation provided for in
paragraph (a) of this section 4 and may be issued pursuant to this Plan.

         5. Use of Common Stock Issued under this Plan. Shares of Common Stock
may be issued under this Plan in respect of Fees and Retainers on such terms as
may be fixed by the Board of Directors from time to time. All shares of Common
Stock issued pursuant to this Plan shall be valued at not less than 100% of the
Fair Market Value of

<PAGE>

such shares on the effective date of issuance of such shares, regardless of when
such shares are actually issued.

         6. Payment and Deferral of Retainers and Fees.

         (a) Except as otherwise expressly set forth in this section 6, (i) a
portion of any Retainer or Fee shall be payable in shares of Common Stock, with
the balance being payable in cash, all in accordance with determinations made by
the Board of Directors from time to time, and (ii) all payments shall be made as
promptly as practicable following the conclusion of each Service Period.

         (b) Subject to and in conformity with such procedures as may be
approved by the Board of Directors from time to time, a Nonemployee Director may
elect to receive in shares of Common Stock all or any portion of any Retainer or
Fee that would otherwise be payable in cash.

         (c) Not later than the day immediately preceding the first day of any
Service Period, a Nonemployee Director may elect to defer all or any portion of
the Common Stock or the cash payable in respect of any Retainer or Fee, as the
case may be, for the next following Service Period. Such election shall be made
in writing and, once made, shall be irrevocable.

         (d) (i) Any portion of a Retainer or Fee payable in cash and as to
which a deferral election is made shall be payable to the Nonemployee Director
or his or her heirs or beneficiaries in a lump sum or in installments (as
specified by the Nonemployee Director in accordance with arrangements approved
by the Board of Directors) following a date specified by the Nonemployee
Director, which date shall in no event be earlier than such Nonemployee
Director's termination from service. An interest equivalent on any amount so
deferred shall be computed at such rate or rates as may be fixed by the Board of
Directors from time to time.

         (ii) Any portion of a Retainer or Fee payable in Common Stock and as to
which a deferral election is made shall be payable to the Nonemployee Director
or his or her heirs or beneficiaries in a lump sum or in installments (as
specified by the Nonemployee Director in accordance with arrangements approved
by the Board of Directors) following a date specified by the Nonemployee
Director, which date shall in no event be earlier than such Nonemployee
Director's termination from service. The Common Stock shall be held in a trust
established by the Company. Dividends paid on such Common Stock will be
reinvested in Common Stock. The Nonemployee Director shall have the right to
vote the Common Stock held in such trust, if, as and to the extent specified in
the trust.

         (e) The terms of this Plan are intended to insure that the electing
Nonemployee Director is not subject to income tax on any cash or Common Stock
(including any cash or Common Stock that has been deferred) until such amounts
are paid to the Nonemployee Director.

<PAGE>

         7. Adjustment Provisions.

         (a) In the event that any reclassification, split up or consolidation
of the Common Stock shall be effected, or the outstanding shares of Common Stock
are, in connection with a merger or consolidation of the Company or a sale by
the Company of all or a part of its assets, exchanged for a different number or
class of shares of stock or other securities or property of the Company or for
shares of the stock or other securities or property of any other corporation or
person, or a record date for determination of holders of Common Stock entitled
to receive a dividend payable in Common Stock shall occur, the number, class and
kind of shares that have not been issued pursuant to this Plan shall be
equitably adjusted.

         (b) In the event that any spin off or other distribution of assets of
the Company to its shareholders (including without limitation an extraordinary
dividend) shall occur, the number, class and kind of shares that have not been
issued pursuant to this Plan shall be equitably adjusted.

         8. Term. This Plan shall be deemed adopted and shall become effective
on the date on which the Common Stock is distributed to the holders of common
stock of W. R. Grace & Co., a Delaware corporation subsequently renamed "Sealed
Air Corporation." No Common Stock shall be issued under this Plan after the
tenth anniversary of such date.

         9. General Provisions.

         (a) Nothing in this Plan or in any instrument executed pursuant hereto
shall confer upon any person any right to continue to serve as a Nonemployee
Director or to receive Retainers or Fees.

         (b) No shares of Common Stock shall be issued pursuant to this Plan
unless and until all legal requirements applicable to the issuance of such
shares have, in the opinion of counsel to the Company, been complied with. In
connection with any such issuance, the person or entity acquiring the shares
shall, if requested by the Company, give assurances, satisfactory to counsel to
the Company, in respect of such matters as the Company or a Subsidiary may deem
desirable to assure compliance with all applicable legal requirements.

         (c) No person, individually or as a member of a group, and no
beneficiary or other person claiming under or through him or her, shall have any
right, title or interest in or to any shares of Common Stock allocated or
reserved for the purposes of this Plan except as to such shares of Common Stock,
if any, as shall have been issued to him or her. No rights to receive shares of
Common Stock under this Plan shall be subject in any manner to alienation, sale,
transfer, assignment, pledge, encumbrance or charge, except by will or the laws
of descent and distribution. The only rights that may exist under this Plan
shall be limited to those of an unsecured creditor of the Company.

<PAGE>

         (d) Nothing in this Plan is intended to be a substitute for, or shall
preclude or limit the establishment or continuation of, any other plan, practice
or arrangement for the payment of compensation or benefits to Nonemployee
Directors that the Company now has or may hereafter put into effect.

         10. Amendments and Termination.

         (a) This Plan may be terminated, suspended or amended at any time by
the Board of Directors upon the recommendation of its Compensation Committee;
provided, however, that no amendment shall become effective without the approval
of the shareholders of the Company to the extent shareholder approval is
required by applicable law.

         (b) No termination, suspension or amendment of this Plan shall
adversely affect any shares theretofore issued pursuant to this Plan.EXHIBIT 10.16

GRACE MEMO                                                Human Resources
                                                          Columbia, Maryland

Date:            July 2002

To:              Participants in the 2002 Long-Term Incentive Program

From:            M. N. Piergrossi

cc:              J. P. Forgach              S. K. Krawczel
                 M. T. Johnson              W. B. McGowan

I am pleased to inform you that you have been selected to participate in Grace's
2002-2004 Long-Term Incentive Program. The 2002 Long-Term Incentive Program
provides for 100% of the value of your award to be paid in cash.

LTIP CASH PAYOUT

Your 2002 LTIP payout will be based on the average annual growth rate (AAGR) in
total Grace core EBIT achieved during the 3-year performance period (i.e.
2002-2004). The target AAGR is 6%, using 2001 results as the base. The payout
will vary with actual results as described in Annex B attached to your award.

Under U.S. federal income tax law, the value of the cash payments, when
received, will constitute ordinary income and will trigger income tax
withholding obligations at that time. If you are subject to taxes in a country
other than the United States, the tax consequences of the receipt of cash will
be determined under the laws of such country.

ENCLOSURES

o   Two copies of your 2002 LTIP Award
o   Sample Calculation of the 2002-2004 LTIP (which constitutes part of Annex B)
o   Administrative Practices - Long-Term Cash Award Program (which constitutes
    Annex C)

REQUIRED ACTIONS

Please promptly sign and return one copy of the cash award to Marihelen Johnson
in the Columbia office.

ADDITIONAL QUESTIONS

If you have any questions on this program, please feel free to call me at (410)
531-4183 or Sonya Krawczel at (410) 531-4479.

THIS DOCUMENT CONSTITUTES PART OF A
PROSPECTUS COVERING SECURITIES THAT
HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933.

<PAGE>

                                      -2-

                                     ANNEX B

                          CALCULATION OF 2002-2004 LTIP

Name of Participant:       ______________________________

Targeted Award:            ______________________________

Your 2002-2004 LTIP award payout will be based on the 3-year average annual
growth rate (AAGR) in total Grace core earnings before interest and taxes (core
EBIT). Payouts are contingent upon achievement of target AAGR for the 3-year
performance period. The target AAGR is 6%, using 2001 results as the base year.

The core earnings before interest and taxes (core EBIT) in 2001 was $187.5
million. The chart below details five scenarios at different assumed growth
rates. The target growth is highlighted.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------
                                  PERFORMANCE PERIOD
       ASSUMED    BASE        2002       2003       2004    TOTAL      LTIP        CUMULATIVE
        GROWTH  PERIOD                                      GROWTH     POOL         REPORTED
         RATES    2001                                      02-04 (1)             EARNINGS (2)
-------------------------------------------------------------------------------------------------
         <S>      <C>         <C>        <C>       <C>        <C>       <C>          <C>
         1.50%    187.5       190.3      193.2     196.1      579.5     2.9          576.6
         3.00%    187.5       193.1      198.9     204.9      596.9     5.9          591.0
         6.00%    187.5       198.8      210.7     223.3      632.7     11.8         620.9
        10.00%    187.5       206.3      226.9     249.6      682.7     14.3         670.9
        15.00%    187.5       215.6      248.0     285.2      748.8     17.3         737.0
        25.00%    187.5       234.4      293.0     366.2      893.6     23.6         881.8
-------------------------------------------------------------------------------------------------
</TABLE>

(1) All results include full recognition/accrual of Annual Incentive
Compensation Program and, for achievement levels above 6% (i.e., 10%, 15%, and
25%), all totals include accruals for Long-Term Incentive Program Payments

(2) Up to the first $11.8 million (target AAGR 6%) is deducted from reported
results. Payouts over target ($11.8 million) must be accrued as part of reported
earnings. As a result, actual growth rate is slightly lower than assumed growth
rate.

<PAGE>

                                      -3-

The Long-Term Cash Award payout will vary with actual results as shown in the
chart below:

         ----------------------- -------------------------------------------
           AAGR LEVEL ACHIEVED                    PAYOUT
                                  (ROUNDED TO THE NEAREST WHOLE PERCENTAGE)
         ----------------------- -------------------------------------------
                  25%                               200%
         ----------------------- -------------------------------------------
                  15%                               147%
         ----------------------- -------------------------------------------
                  10%                               121%
         ----------------------- -------------------------------------------
                   6%                               100%
         ----------------------- -------------------------------------------
                   3%                                50%
         ----------------------- -------------------------------------------
                  1.5%                               25%
         ----------------------- -------------------------------------------

For the 2002-2004 LTIP, cash payments will be made in two installments - 50% of
what is earned based on current performance at the end of 2003, but no more than
50% of target, will be paid in March 2004, and the balance will be paid in March
2005.

Example:

A sample calculation of the Long-Term Cash Award Earned is provided below.
Assume that your Targeted Award is $20,400.

----------------- --------------------- ------------------ --------------------
     AAGR LEVEL      PAYOUT IN MARCH      PAYOUT IN MARCH
     ACHIEVED             2004                  2005          TOTAL PAYOUT
----------------- --------------------- ------------------ --------------------
         25%             $6,800               $34,000           $40,800
----------------- --------------------- ------------------ --------------------
         15%             $6,800               $23,188           $29,988
----------------- --------------------- ------------------ --------------------
         10%             $6,800               $17,885           $24,685
----------------- --------------------- ------------------ --------------------
         6%              $6,800               $13,600           $20,400
----------------- --------------------- ------------------ --------------------
         3%              $3,400                $6,800           $10,200
----------------- --------------------- ------------------ --------------------

<PAGE>

                                      -4-

                                     ANNEX C

                                W. R. GRACE & CO.

             ADMINISTRATIVE PRACTICES - LONG-TERM CASH AWARD PROGRAM
                          2002-2004 Performance Period

DEFINITIONS

"Award Payment": An Interim Long-Term Cash Award Payment or Remaining Long-Term
Award Payment, as applicable.

"BOARD OF DIRECTORS": THE BOARD OF DIRECTORS OF THE COMPANY

"Committee": The Compensation Committee of the Board of Directors.

"Company": W. R. Grace & Co., a Delaware Corporation and/or, if applicable in
the context, one or more of its Subsidiaries.

"Incomplete Long-Term Cash Awards": A Long-Term Cash Award for which the
Performance Period has not been completed as of the date referenced.

"Interim Long-Term Cash Award Payment": As defined on page 4, provided that such
payment will not exceed 50% of the Participant's Targeted Award for the first
two years, regardless of Company performance at the time of payment.

"Key Employee": An officer or other senior, full-time employee of the Company,
who, in the opinion of the Company, can contribute significantly to the growth
and successful operations of the Company.

"Long-Term Cash Award Program": An undertaking by the Company to financially
reward a Key Employee at the end of a Performance Period, which undertaking is
contingent upon or measured by the attainment over the Performance Period of
specified performance objectives determined (on a consolidated or unconsolidated
basis) by changes in the 3-year average annual growth rate (AAGR) in Total
Grace's core earnings before interest and taxes (core EBIT).

"Long-Term Cash Award": A cash award, to be paid in the future, which is granted
to Key Employees under the Company's long-term incentive program.

"Long-Term Cash Award Earned": The amount of cash earned by a Participant
pursuant to the terms of a Long-Term Cash Award.

"Participant": A Key Employee who is, or who is proposed to be, a recipient of a
Long-Term Cash Award.

"Performance Period": Except as provided herein, a period of three calendar
years over which a Long-Term Cash Award may be earned, as approved by the
Committee. The first Performance Period under this Plan will commence effective
January 1, 2002 and will end on December 31, 2004. Performance Periods with
respect to different Long-Term Cash Awards to the same individual may overlap.

<PAGE>

                                      -5-

"Total Grace Core EBIT": The core earnings before interest and taxes (core
EBIT)" of the Company as reported on (and calculated in accordance with) the
statement of W. R. Grace & Co. Continuing Operations- Segment Basis.

"Remaining Long-Term Cash Award Payment": As defined on Page 4, the second
installment of the Long-Term Cash Award that may be paid after the end of the
Performance Period, based on Company performance for the entire Performance
Period.

"Subsidiary": A corporation, partnership, limited liability company or other
form of business association of which shares of common stock or other ownership
interests (i) having more than 50% of the voting power regularly entitled to
vote for directors (or equivalent management rights) or (ii) regularly entitled
to receive more than 50% of the dividends (or their equivalents) paid on the
common stock (or other ownership interests), are owned, directly or indirectly,
by the Company.

"Targeted Award": The amount of cash award specified in writing for a
Participant as his or her "Targeted Award" for a Performance Period and which is
subject to and covered by the terms and conditions of a Long-Term Cash Award.
This amount may be different from the Long-Term Cash Award Earned by an
individual.

PLAN ADMINISTRATION

The Plan shall be administered by the Committee, provided that no member of the
Committee shall be eligible to receive a Long-Term Cash Award while serving on
the Committee.

The Committee shall approve (i) the performance measurements and objectives for
each Long-Term Cash Award and (ii) the Performance Period over which a Long-Term
Cash Award is to be earned.

The Committee shall approve (i) the Key Employees who are to be granted
Long-Term Cash Awards and (ii) the Targeted Award subject to each Long-Term Cash
Award.

LONG-TERM CASH AWARDS

The Committee may, at any time or from time to time, grant Long-Term Cash Awards
to Key Employees.

Each Long-Term Cash Award shall be evidenced by a written instrument containing
such terms and conditions as the Committee shall approve, provided the
instrument is consistent with these practices.

No Long-Term Cash Award, nor any payment or right thereunder, shall be subject
in any manner to alienation, sale, transfer, assignment, pledge, encumbrance or
charge, except by will or the laws of descent and distribution, or by the terms
of a Participant's Designation of Beneficiary, if any, on file with the Company.

<PAGE>

                                      -6-

In the case of a Key Employee who becomes a Participant after the beginning of a
Performance Period, the Committee may ratably reduce the amount of the Targeted
Award covered by such Employee's Long-Term Cash Award or otherwise appropriately
adjust the terms of the Long-Term Cash Award to reflect the fact that the Key
Employee is to be a Participant for only part of the Performance Period.

It is the intention of the Committee that Long-Term Cash Awards be related to
the results of the core operations affected by the management actions taken by
the Participants. Subject to the administrative practices that apply to
termination or change in employment status and to the amendment or
discontinuance of Long-Term Cash Awards, the performance objectives applicable
to Long-Term Cash Awards will remain unchanged during the Performance Period
except as follows:

o   In the event of the divestment of a Business prior to completion of the
    Performance Period, both the performance objectives and results pertaining
    to that Business shall be eliminated for the full year in which the
    divestment occurs and for any subsequent years.

o   In general, acquisitions will be included in the performance results.

TERMINATION OR CHANGE IN EMPLOYMENT STATUS

A Participant shall forfeit all rights to any Award Payment, if, prior to the
date of payment of such Award Payment, the Participant (1) resigns without the
consent of the Committee, (2) retires under a retirement plan of the Company or
Subsidiary before age 62 without the consent of the Committee, or (3) is
terminated for cause.

If a Participant retires under a retirement plan of the Company or Subsidiary at
or after age 62, or ceases employment as a result of death or disability, or
ceases employment as a result of an involuntary termination after a Change in
Control of the Company (as defined herein), during a Performance Period, then
his rights in any Incomplete Long-Term Cash Award related to that Performance
Period shall thereupon vest, and he shall be entitled to receive any Award
Payment of any Long-Term Cash Award Earned he would otherwise have received (at
the time he would have otherwise received the Award Payment), except that the
amount of any Long-Term Cash Award Earned shall be reduced ratably in proportion
to the portion of the Performance Period during which the Participant was not an
employee. If a Participant ceases employment with the Company for any of the
reasons specified in this paragraph, after the completion of any Performance
Period (but before the payment of the Remaining Long-Term Cash Award Payment
related to the completed Performance Period), then his rights to any Long-Term
Cash Award Earned and to such Award Payment related to the completed Performance
Period shall thereupon vest, and he shall be entitled to receive such Award
Payment at the time he would have otherwise received the Payment.

If a Participant ceases employment with the Company for any reason other than
those indicated in the previous two paragraphs (including by reason of
involuntary termination not for cause, except as provided above with respect to
involuntary termination after a Change in Control of the Company, or transfer of
employment to a buyer of any business unit of the Company), then his rights in
any Incomplete Long-Term Cash Award, and any Award Payment that is unpaid as of
the date the Participant ceases

<PAGE>

                                      -7-

such employment, shall be determined by the Committee (or the designee of the
Committee, which may include the Chief Executive Officer of the Company) as soon
as practicable after the Participant ceases such employment. All such
determinations shall be final and binding on all parties.

Except as modified by the provisions of the second and third paragraphs of this
section, payments due to Participants pursuant to the applicable preceding
paragraphs, above, shall be calculated and made in accordance with the
provisions described under the section entitled "Calculation of Long-Term Cash
Awards Earned: Form of Payment".

A leave of absence, if approved by the Committee, shall not be deemed a
termination or change of employment status for the purposes of this section,
but, unless the Committee otherwise directs, any Long-Term Cash Award Earned
that a Participant would otherwise have received under a Long-Term Cash Award
Program shall be reduced ratably in proportion to the portion of the Performance
Period during which the Participant was on such leave of absence.

Any consent, approval or direction which the Committee may give under this
section in respect of an event or transaction may be given before or after the
event or transaction.

CALCULATION OF LONG-TERM CASH AWARDS EARNED: FORM OF PAYMENT

Long-Term Cash Awards Earned will be paid to a Participant in two installments
(1) the first installment shall be paid in March of the third and final year of
the Performance Period and shall be equal to 50% of what is earned based on the
Company's performance for the first two calendar years of the applicable
Performance Period, but no more than 50% of the Participant's Targeted Award
(the "Interim Long-Term Cash Award Payment"), and (2) the balance, if any, of
the Long-Term Cash Award Earned will be paid in March after the end of the third
and final year of the Performance Period (the "Remaining Long-Term Cash Award
Payment").

The Committee shall determine the extent to which the performance objectives of
a Long-Term Cash Award have been achieved during the Performance Period and the
amount of any Long-Term Cash Awards Earned (and the amount of any Award
Payment). All calculations in this regard shall be made in accordance with the
generally accepted accounting principles customarily applied by the Company and
shall be submitted to the Committee for its review and approval. The
determination of the Committee shall be final and binding.

<PAGE>

                                      -8-

GENERAL

Nothing in this document nor in any instrument executed pursuant hereto shall
confer upon a Participant any right to continue in the employ of the Company or
a Subsidiary, or shall affect the right of the Company or a Subsidiary to
terminate his or her employment with or without cause.

The Company or a Subsidiary may make such provisions as it may deem appropriate
for the withholding or any taxes that the Company or a Subsidiary determines it
is required to withhold in connection with any Long-Term Cash Award Earned.

Nothing in a Long-Term Cash Award is intended to be a substitute for, or shall
preclude or limit the establishment or continuation of, any other plan,
practice, or arrangement for the payment of compensation or benefits to
employees generally, or to any class or group of employees, which the Company or
a Subsidiary now has or may hereafter lawfully put into effect, including,
without limitation, any retirement, pension, group insurance, annual bonus,
stock purchase, stock bonus or stock option plan; provided, however, that no
amounts awarded or paid pursuant to any Long-Term Cash Award shall be included
or counted as compensation for the purposes of any employee benefit plan of the
Company or a Subsidiary where contributions to the plan, or the benefits
received from the plan, are measured or determined in whole or in part, by the
amount of the employee's compensation.

The grant of a Long-Term Cash Award to an employee of a Subsidiary shall be
contingent on the approval of the Long-Term Cash Award by the Subsidiary and the
Subsidiary's agreement that (i) the Company may administer such Award on its
behalf and (ii) the Subsidiary will make, or reimburse the Company for, the
payments called for by the Long-Term Cash Award. The provisions of this
paragraph and the obligations of the Subsidiary so undertaken may be waived, in
whole or in the part, from time to time by the Company.

AMENDMENTS AND DISCONTINUANCE

In the event acquisitions, divestments, substantial changes in tax or other laws
or in accounting principles or practices, natural disasters or other
extraordinary events render fulfillment of the performance objectives of a
Long-Term Cash Award impossible or impracticable, or result in the achievement
of the performance objectives without appreciable effort by the Participant, the
Committee may, but shall not be obligated to, amend any such Long-Term Cash
Award in any appropriate manner so that the Participant may earn Long-Term Cash
Awards comparable to those that might have been earned if the extraordinary
event had not occurred.

The Chief Executive Officer of the Company may approve such technical changes
and clarifications to the Long-Term Cash Award Program as necessary, provided
such changes or clarifications do not vary substantially from the terms and
conditions outlined in this description.

<PAGE>

                                      -9-

In the event a Change in Control of the Company (as defined herein) shall occur
or the Board of Directors has reason to believe that a Change of Control may
occur, the Committee may, with respect to any one or more Long-Term Cash Awards,
(i) reduce the length of a Performance Period to not less than one year, (ii)
make ratable adjustments to performance objectives and Targeted Awards, (iii)
change the methods of measuring the performance objectives, (iv) accelerate the
payment of any Long-Term Cash Awards Earned or any Award Payment, and (v) take
other action deemed by it to be appropriate and in the best interests of the
Company under the circumstances. For the purposes of this paragraph:

(A)  "Change in Control of the Company" means and shall be deemed to have
     occurred if (a) the Company determines that any "person" (as such term is
     used in Section 13(d) and 14 (d) of the Securities Exchange Act of 1934),
     other than a trustee or other fiduciary holding securities under an
     employee benefit plan of the Company or a corporation owned, directly or
     indirectly, by the stockholders of the Company in substantially the same
     proportions as their ownership of stock of the Company, has become the
     "beneficial owner" (as defined in Rule 13d-3 under such Act), directly or
     indirectly, of 20% or more of the outstanding common stock of the Company
     (provided, however, that a Change in Control shall not be deemed to have
     occurred if such person has become the beneficial owner of 20% or more of
     the outstanding Common Stock as the results of a sale of Common Stock by
     the Company that has been approved by the Board of Directors); or pursuant
     to a plan of reorganization which has been confirmed by the U.S. District
     Court or Bankruptcy Court having jurisdiction of the Company's Chapter 11
     case, Case No. 01-01139 (JJF), pursuant to an order of such Court which is
     final and nonappealable, and becomes effective); (ii) individuals who are
     Continuing Directors cease to constitute a majority of any class of
     directors of the Board; (iii) there occurs a reorganization, merger,
     consolidation or other corporate transaction involving the Company (a
     "Corporate Transaction"), in each case, with respect to which the
     stockholders of the Company immediately prior to such Corporate Transaction
     do not, immediately after the Corporate Transaction, own 50% or more of the
     combined voting power of the corporation resulting from such Corporate
     Transaction, provided that this clause (iii) shall not apply to a Corporate
     Transaction which is pursuant to section 363 of the Bankruptcy Code, or is
     pursuant to a plan of reorganization which has been confirmed by the U.S.
     District Court or Bankruptcy Court having jurisdiction of the Company's
     chapter 11 case, Case No. 01-01139 (JJF), pursuant to an order of such
     Court which is final and nonappealable, and becomes effective, or (iv) the
     shareholders of the Company approve a complete liquidation or dissolution
     of the Company.

(B)  "Continuing Director" means any member of the Board of Directors who was
     such a member on the date on which this Program was approved by the Board
     of Directors, and any successor to a Continuing Director who is approved as
     a nominee or elected to succeed to a Continuing Director by a majority of
     Continuing Directors who are then members of the Board of Directors.

The granting of Long-Term Cash Awards may be amended or discontinued by the
Committee at any time.

<PAGE>

                                      -10-

No amendment or discontinuance of Long-Term Cash Awards shall, without a
Participant's consent, adversely affect his rights in any Long-Term Cash Awards
theretofore granted to him, except that, if the Committee so directs, all
Incomplete Long-Term Cash Awards may be terminated prospectively with the same
effect as a termination of employment under the second paragraph of the section
entitled "Termination or Change in Employment Status".

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