Document:

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                                                                    Exhibit 10.1

                            FORM OF SUPPORT AGREEMENT

      This Support Agreement (this "AGREEMENT"), dated as of February 22, 2005,
is entered into by and among WPP Group plc, a corporation organized under the
laws of England and Wales ("WPP"), Grey Global Group Inc., a Delaware
corporation ("GREY"), and the person listed on Annex B (the "CONSENTING
HOLDER"). For purposes of this Agreement, WPP, Grey and the Consenting Holder
shall individually be referred to as a "PARTY" and, collectively, the "PARTIES".

                                 R E C I T A L S

      WHEREAS, the Consenting Holder is a beneficial owner of the 5% Contingent
Convertible Subordinated Debentures due 2033 (the "DEBENTURES") of Grey issued
pursuant to an Indenture, dated as of October 28, 2003 (the "INDENTURE"),
between Grey and the American Stock Transfer & Trust Company as trustee (the
"TRUSTEE"); capitalized terms used but not defined herein shall have the
respective meanings ascribed to these terms in the Indenture;

      WHEREAS, pursuant to an Agreement and Plan of Merger, dated as of
September 11, 2004, by and among WPP, Abbey Merger Corporation ("ABBEY") and
Grey (as amended, the "MERGER AGREEMENT"), Grey will be merged with and into
Abbey (the "MERGER"), with Abbey being the surviving corporation in the Merger
and remaining as a wholly owned subsidiary of WPP, and pursuant to the Merger,
each outstanding shares of common stock, par value $0.01 per share, of Grey and
each share of Limited Duration Class B Common Stock, par value $0.01 per share,
of Grey will be converted into the right to receive merger consideration in the
form of cash or WPP shares in accordance with the terms of the Merger Agreement;

      WHEREAS, pursuant to Section 6.16 of the Merger Agreement, Grey is
required, to the extent requested by WPP, to use reasonable best efforts to
cooperate with WPP to effect a consent solicitation with respect to the
Debentures, as directed by WPP;

      WHEREAS, at the request of WPP and in accordance with Section 6.16 of the
Merger Agreement, Grey has agreed to seek consents of the holders of the
Debentures to the adoption of a second supplement to the Indenture substantially
in the form set forth on Annex A (the "SECOND SUPPLEMENTAL INDENTURE");

      WHEREAS, WPP has agreed to direct Grey to commence the Consent
Solicitation (as defined below) and, subject to the terms and conditions of this
Agreement, to execute and deliver, and cause Grey to execute and deliver, to the
Trustee the Second Supplemental Indenture as promptly as practicable after
receipt of valid consents of Holders of at least 75% (or, at the sole discretion
of WPP, a lower percentage determined by WPP) of the principal amount of the
Debentures then outstanding;

      WHEREAS, the Consenting Holder has agreed, subject to the terms and
conditions of this Agreement, to cause consents to be executed and delivered in
favor of the adoption of the Second Supplemental Indenture with respect to all
the Debentures beneficially owned by the Consenting Holder or as to which it has
investment authority or discretion as set forth on Annex B;
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      NOW, THEREFORE, in consideration of the foregoing recitals and the terms
and conditions set forth herein, WPP, Grey and the Consenting Holder hereby
agree as follows:

      1.    Consent Solicitation. Grey shall commence, as promptly as
practicable on or after the date of this Agreement, a solicitation of consents
of the Holders of the Debentures to approve the adoption of the Second
Supplemental Indenture (the "CONSENT SOLICITATION"). The Consent Solicitation
shall remain open until 5:00 p.m., New York City time on March 4, 2005 (the
"EXPIRATION TIME"); provided, that, at the discretion of WPP and Grey, the
Consent Solicitation may be extended beyond the then applicable Expiration Time,
if as of such Expiration Time, the conditions set forth in Section 3 shall not
then be satisfied (or capable of being satisfied) or waived; and in the case of
such extension of the Consent Solicitation, the "EXPIRATION TIME" shall
thereafter be the time at which the Consent Solicitation will expire after
giving effect to such extension. The Consent Solicitation shall provide that,
subject to, and promptly after the later of, the execution and delivery of the
Second Supplemental Indenture by the parties thereto, the consummation of the
Merger and the occurrence of the Expiration Time, Abbey, as successor by merger
to Grey, will pay to each Holder of Debentures the Consent Fee for each
$1,000.00 principal amount of Debentures in respect of which such Holder
properly grants prior to the Expiration Time a consent to the adoption of the
Second Supplemental Indenture (which consent is not revoked or withdrawn). As
soon as practicable after, but subject to, the satisfaction or waiver of the
conditions set forth in Section 3, WPP and Grey shall execute and deliver to the
Trustee the Second Supplemental Indenture. The "CONSENT FEE" shall be equal to
$23.33; provided, however, that if consents to the adoption of the Second
Supplemental Indenture are properly granted prior to Expiration Time (and not
revoked or withdrawn) in respect of fewer than 75% of the then outstanding
principal amount of the Debentures, but WPP determines, in its sole discretion,
that the condition set forth in Section 3(a) shall be satisfied by receipt of
properly granted consents (that are not revoked or withdrawn) in respect of a
lower percentage (determined by WPP, in its sole discretion) of the outstanding
principal amount of the Debentures, the "CONSENT FEE" shall be equal to $20.00.

      2.    Agreements of Consenting Holder in Connection With the Consent
Transactions.

      The Consenting Holder shall:

            (a)   as soon as reasonably practicable but no later than two
Business Days following commencement of the Consent Solicitation, deliver
written instructions to any Depository Trust Company participant, bank, broker,
financial institution or other person holding Debentures on its behalf (the
"NOMINEE") duly instructing the Nominee to consent (and not thereafter revoke)
and take any and all other actions necessary to cause its Nominee to consent (as
soon as reasonably practicable after such instruction is delivered to the
Nominee) to the adoption of Second Supplemental Indenture with respect to all
the Debentures beneficially owned by it or as to which it has investment
authority or discretion;

            (b)   not object to the consummation of the Consent Solicitation or
the execution or delivery of the Second Supplemental Indenture or otherwise
commence any proceeding or make any statements or encourage holders of the
Debentures, to oppose, or take an action that could materially adversely affect
or materially delay, the Consent Solicitation or the execution or delivery of
the Second Supplemental Indenture; and

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            (c)   not take any other action (and shall not instruct its Nominee
to take any action on its behalf), including initiating any legal proceeding, or
make any statement that is materially inconsistent with, or that could
materially delay consummation of, the Consent Solicitation or the execution or
delivery of the Second Supplemental Indenture.

      3.    Conditions to Execution and Delivery of the Second Supplemental
Indenture. The obligations of WPP and Grey to execute and deliver to the Trustee
the Second Supplemental Indenture are subject to the prior or simultaneous
satisfaction, or waiver by WPP and Grey, of the following conditions:

            (a)   Requisite Consents Condition. Holders of Debentures shall have
properly granted consents (which shall not have been withdrawn or revoked) to
the adoption of the Second Supplemental Indenture in respect of at least 75% (or
at such lower percentage as WPP shall determine in its sole discretion) of the
then aggregate outstanding principal amount of the Debentures;

            (b)   No Prohibition. No law, statute, rule, decree, order or
injunction that prohibits, restrains or enjoins the consummation of the Consent
Solicitation or the execution or delivery of the Second Supplemental Indenture
shall have been enacted, entered, promulgated or otherwise be in effect; and

            (c)   Trustee Acceptance. The Trustee shall have executed and
delivered the Second Supplemental Indenture.

      4.    Termination. (a) Subject to Section 4(b) hereof, this Agreement
shall terminate upon the earlier of (i) the valid execution and delivery by WPP,
Grey and the Trustee of the Second Supplemental Indenture, (ii) the termination
of the Merger Agreement in accordance with its terms prior to the consummation
of the Merger or (iii) March 15, 2005. This Agreement may be terminated by
written agreement of WPP and the Consenting Holder.

            (b)   In the event of the termination of this Agreement pursuant to
Section 4(a), this Agreement shall forthwith become void and there shall be no
liability or obligation on the part of any Party, except with respect to
Sections 4, 5(b), 12 and 14, which shall survive termination; provided that the
termination of this Agreement shall not relieve any party from liability for any
breach of this Agreement by such Party prior to such termination.

      5.    Forbearance; Restrictions on Transfers. (a) The Consenting Holder
agrees that, prior to the execution and delivery by WPP, Grey and the Trustee of
the Second Supplemental Indenture, it shall not:

            (i)   give instructions to the Trustee (and shall revoke or cause to
be revoked any instructions previously given by it to the Trustee) for the
Trustee to take any action that is inconsistent with this Agreement; and

            (ii)  directly or indirectly, sell, assign, transfer or otherwise
dispose of, by conversion or otherwise, any of the Debentures beneficially owned
by it or as to which it has investment authority or discretion (including any of
the Debentures acquired after this date), unless the transferee thereof agrees
in writing for the benefit of WPP to be bound by all of the

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terms of this Agreement and executes a counterpart signature page of this
Agreement and the transferor provides WPP with a copy thereof.

            (b)   The Consenting Holder further agrees that, from and after the
execution and delivery by WPP, Grey and the Trustee of the Second Supplemental
Indenture, it shall not convert any Debenture beneficially owned by it into
Common Stock. The agreement of the Consenting Holder set forth in the preceding
sentence shall terminate upon the earliest to occur of (i) the termination of
the Merger Agreement in accordance with its terms prior to the consummation of
the Merger, (ii) the failure of WPP or Grey to observe or perform in any
material respect any covenant contained in this Agreement or any representation
or warranty made by WPP or Grey herein shall prove to have been incorrect in any
material respect when made or deemed made or (iii) March 15, 2005.

      6.    Representations and Warranties of the Parties. Each of the Parties
represents and warrants to the other Parties, as of this date as follows:

            (a)   Power, Authority and Authorization. Such Party has all
requisite power and authority to execute and deliver this Agreement, to perform
its obligations under this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary action (corporate or other) on the part of such
Party, and the person executing this Agreement on behalf of such Party is duly
authorized to do so.

            (b)   Binding Obligation. This Agreement has been validly executed
and delivered by such Party and is the legal, valid and binding obligation of
such Party, enforceable against such Party in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency or other similar laws,
both foreign and domestic, relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.

            (c)   No Conflicts. None of the execution, delivery or performance
of this Agreement, nor the compliance with the terms and provisions of this
Agreement, nor the consummation of any of the transactions contemplated hereby,
shall conflict with, violate, or constitute a breach of or a default under, (i)
any law, statute, rule, regulation, ordinance, judgment, decree or order
applicable to such Party or any of its subsidiaries or any of their respective
businesses or properties, (ii) such Party's organizational documents or (iii)
any contractual obligations to which such Party or any of its subsidiaries is a
Party or by which such Party, any of its subsidiaries or any of their respective
properties are bound except for Section 2.4 of the Merger Agreement, the Note
Agreement dated as of March 14, 2003, as amended, between Grey and the
Prudential Insurance Company of America; Note Agreement dated as of November 13,
2000, as amended, between Grey and the Prudential Insurance Company; and the
Credit Agreement dated December 21, 2001, as amended, among Grey, HSBC Bank USA,
as documentation agent, Fleet National Bank, as syndication agent, JP Morgan
Chase Bank, as administrative agent and the various other lenders named therein
(it being understood that no conflict with, violation or breach of or default
under the agreements referred to in clause (iii) (collectively, the "FINANCING
AGREEMENTS") shall relieve WPP or Grey of its obligation, subject

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to the prior or simultaneous satisfaction, or waiver by WPP and Grey, of the
conditions set forth in Section 3, to execute and deliver the Second
Supplemental Indenture).

            (d)   No Proceedings. There is no action, claim, suit, demand,
hearing, notice of violation or deficiency, or proceeding (including any
investigation or partial proceeding, such as a deposition), domestic or foreign,
pending, or to the knowledge of such Party threatened, against or that affects
such Party that could prevent the consummation of, materially impair or
materially delay any of the transactions contemplated hereby.

      7.    Additional Representations and Warranties of the Consenting Holder.
The Consenting Holder represents and warrants to WPP as follows:

            (a)   The Consenting Holder and its advisors have such knowledge and
experience in financial and business matters that they are capable of evaluating
the merits and risks of the transactions contemplated by this Agreement,
including the adoption of the Second Supplemental Indenture.

            (b)   The Consenting Holder beneficially owns and/or has investment
authority or discretion with respect to, and as of 5:00 p.m. New York City time
on February 19, 2005, beneficially owned and/or had investment authority or
discretion with respect to, the aggregate principal amount of Debentures set
forth next to the Consenting Holder's name on Annex B, and such aggregate
principal amount of Debentures constitutes all of the Debentures so owned or
controlled by the Consenting Holder. Annex B correctly sets forth the name of
the Nominees who hold Debentures on behalf of the Consenting Holder and the
principal amount of Debentures held by each such Nominee on behalf of the
Consenting Holder.

      8.    Additional Representations and Warranties of WPP and Grey. Each of
WPP and Grey represents and warrants that (a) other than the Indenture, the
Registration Rights Agreement and as contemplated by this Agreement (including
the letter, dated as of the date hereof, to the Consenting Holder (the
"LETTER"), and similar support agreements and related letters with other Holders
(the "OTHER SUPPORT AGREEMENTS" and "OTHER LETTERS")), the Consent Solicitation,
and the Second Supplemental Indenture, it is not a party to any agreement or
understanding with any holder of Debentures with respect to such holder's
Debentures and (b) the Other Support Agreements and the Other Letters contain
terms and conditions substantially the same as or less favorable to the holder
of Debentures party thereto than those contained in this Agreement and the
Letter, respectively, other than with respect to payment of fees and expenses as
provided in Section 12 of this Agreement and the Other Support Agreements.

      9.    Notices. All notices and other communications hereunder shall be in
writing and shall be deemed sufficiently given and served for all purposes when
personally delivered or given by facsimile or one Business Day after a writing
is delivered to a national overnight courier service or three Business Days
after a writing is deposited in the United States mail, first class postage or
other charges prepaid and registered, return receipt requested, addressed as
follows (or at such other address for a Party as shall be specified by like
notice):

            If to WPP, to:

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            WPP Group plc
            27 Farm Street
            London W1J 5RJ
            England
            Attn: Paul W.G. Richardson
            Group Finance Director
            Facsimile No.: (01 44) 20 7409 7502

            With a copy to:

            Fried, Frank, Harris, Shriver & Jacobson LLP
            One New York Plaza
            New York, NY  10004
            Attn:  Arthur Fleischer, Jr., Esq.
                   Philip Richter, Esq.
            Facsimile No.:  (212) 859-4000

            If to Grey, to:

            Grey Global Group Inc.
            777 Third Avenue
            New York, NY 10017
            Attn: Steven G. Felsher
            Vice Chairman, Chief Financial Officer, Secretary and Treasurer

            Facsimile No.:  (212) 546-1495

            With a copy to:

            Simpson Thacher & Bartlett LLP
            425 Lexington Avenue
            New York, NY 10017
            Attention: John G. Finley, Esq.
            Facsimile: (212) 455-2502

            If to the Consenting Holder, at the address set forth on Annex B or
to such other address as the party to whom notice is to be given may have
furnished to WPP in writing in accordance herewith.

      10.   Covenants. (a) Each Party shall promptly notify the other Parties in
writing upon any representation or warranty of such Party contained in this
Agreement becoming untrue or incorrect in any material respect during the term
of this Agreement.

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            (b)   WPP and Grey agree to use their reasonable best efforts to
adopt an amendment to the Merger Agreement contemplating the Second Supplemental
Indenture simultaneously with or immediately following the satisfaction or
waiver of the conditions set forth in Section 3 of this Agreement.

            (c)   WPP agrees to cause to be provided to the Consenting Holder
the information referred to in the second paragraph of Section 4.08 of the
Indenture as amended by the Second Supplemental Indenture promptly after the
consummation of the Merger.

            (d)   Promptly after the execution and delivery of this Agreement,
WPP will file with the SEC the form of this Agreement as an exhibit to a Report
on Form 6-K and as an exhibit to the Schedule 13D previously filed by WPP with
respect to the shares of common stock of Grey.

      11.   Publicity. The initial press release relating to this Agreement and
the transactions contemplated hereby shall be issued by WPP in the form attached
as Annex C.

      12.   Fees and Expenses. Subject to, and promptly after the later of, (i)
the consummation of the Merger, (ii) the execution and delivery of the Second
Supplemental Indenture by all parties thereto, (iii) satisfaction or waiver of
Section 3(a) above and (iv) the receipt of customary invoices, WPP shall pay to
Akin Gump Strauss Hauer and Feld LLP, Magee & Magee and Seward & Kissel the fees
and expenses of such professionals for services performed by them on behalf of
holders of Debentures who have participated in negotiations with WPP regarding
the Second Supplemental Indenture; provided, however, that the fees and expenses
to be paid by WPP pursuant to this sentence and Section 12 of the Other Support
Agreements shall not exceed $250,000.00 in the aggregate. Subject to the
foregoing, each Party to this Agreement will be responsible for its own fees,
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby, whether or not such transactions are
consummated.

      13.   Independent Nature of Consenting Holder's Obligations and Rights.
The Consenting Holder acknowledges that WPP and Grey have indicated that they
intend to enter into Other Support Agreements and WPP will enter into Other
Letters with other holders of the Debentures. The obligations of the Consenting
Holder under this Agreement are independent of the obligations of any other
holder under any Other Support Agreement, if any, and the Consenting Holder
shall not be responsible in any way for the consent of, or performance of the
obligations of, any other holder. Nothing contained herein, and no action taken
by the Consenting Holder pursuant hereto, shall be deemed to constitute the
Consenting Holder and such other holders, if any, as a partnership, an
association, a joint venture or any other kind of entity, or create a
presumption that such holders are in any way acting in concert or as a group
(including for purposes of Section 16 promulgated under the Securities Exchange
Act of 1934, as amended) with respect to such obligations or the transactions
contemplated hereby or by any Other Support Agreement. The Consenting Holder
confirms that it has independently participated in the negotiation of the
transaction contemplated hereby with the advice of its own counsel and advisors.
The Consenting Holder shall be entitled to independently protect and enforce its
rights, including, without limitation, the rights arising out of this Agreement,
and it

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shall not be necessary for any other holder to be joined as an additional party
in any proceeding for such purpose.

      14.   Miscellaneous.

            (a)   Further Assurances. Each Party hereby further covenants and
agrees that it shall take all such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement and shall
refrain from taking any action which would frustrate the purposes and intent of
this Agreement.

            (b)   Effectiveness; Counterparts. This Agreement shall not become
effective and binding on any Party unless and until counterpart signature pages
to its Agreement shall have been executed and delivered by WPP and Grey. This
Agreement may be executed by one of more of the Parties in any number of
counterparts (including by facsimile), each of which shall be deemed to be an
original, but all such counterparts when taken together shall constitute one and
the same instrument.

            (c)   Entire Agreement. This Agreement and the Letter constitute the
entire agreement among the Parties with respect to the subject matter hereof and
supersedes all prior negotiations and all prior agreements and understandings,
both written and oral, among the Parties with respect to the subject matter;
provided that any confidentiality agreement heretofore executed between WPP and
the Consenting Holder shall continue in full force and effect.

            (d)   Interpretation. When a reference is made in this Agreement to
Sections, paragraphs, clauses or Annexes, such reference shall be to a Section,
paragraph or clause of or Annex to this Agreement unless otherwise indicated.
The words "INCLUDE", "INCLUDES", and "INCLUDING" when used shall be deemed in
each case to be followed by the words "WITHOUT LIMITATION." The words "HEREOF,"
"HEREIN," "HEREWITH," "HEREBY" and "HEREUNDER" and words of similar import
shall, unless otherwise stated, be construed to refer to this Agreement as a
whole and not to any particular provision of this Agreement. Unless the context
otherwise requires, defined terms shall include the singular and plural and the
conjunctive and disjunctive forms of the terms defined. None of the Parties
shall have any term or provision construed against such Party solely by reason
of such Party having drafted the same.

            (e)   Specific Performance. Each of the Parties recognizes and
agrees that, if for any reason any of the provisions of this Agreement are not
performed by such Party in accordance with their specific terms or are otherwise
breached, immediate and irreparable harm or injury would be caused to the other
Parties for which money damages would not be an adequate remedy. Accordingly,
each Party agrees that, in addition to any other available remedies, the Parties
shall be entitled to an injunction restraining any violation or threatened
violation of the provisions of this Agreement without the necessity of any Party
posting a bond or other form of security. In the event that any action should be
brought in equity to enforce the provisions of this Agreement, each Party agrees
that it will not allege, and each other Party hereby waives the defense, that
there is an adequate remedy at law.

            (f)   Assignment; Successors and Assigns. Subject to Section 5(a)
(ii), neither this Agreement nor any of the rights, interests or obligations of
the Consenting Holder under this

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Agreement shall be assigned or delegated, in whole or in part, by operation of
law or otherwise by the Consenting Holder without the prior written consent of
WPP and Grey. Neither this Agreement nor any of the rights, interests or
obligations of WPP or Grey under this Agreement shall be assigned or delegated
by WPP or Grey without the prior written consent of the Consenting Holder.

            (g)   No Third Party Beneficiaries. Unless expressly stated herein,
this Agreement shall be solely for the benefit of the Parties and no other
person or entity and is not intended to, and shall not, confer upon any other
person any rights or remedies hereunder.

            (h)   Headings. The headings of the sections, paragraphs and
subsections of this Agreement are inserted for convenience only and shall not
affect the meaning or interpretation of such section, paragraph or subsection or
of this Agreement.

            (i)   Amendments and Waivers. This Agreement may not be modified,
amended or supplemented except in writing signed by WPP, Grey and the Consenting
Holder.

            (j)   GOVERNING LAW; SUBMISSION TO JURISDICTION. EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THIS
AGREEMENT SHALL BE CONSTRUED AND INTERPRETED, AND THE RIGHTS OF THE PARTIES
SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

            THE PARTIES TO THIS AGREEMENT EACH HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE OR FEDERAL COURT SITTING IN THE
BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTION CONTEMPLATED HEREBY,
AND ALL SUCH PARTIES HEREBY IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR
FEDERAL COURT AND HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT THAT THEY MAY
LEGALLY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH
ACTION OR PROCEEDING.

            (k)   Severability. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the Parties
shall use commercially reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the Parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

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            (l)   Acknowledgment. The Parties agree and acknowledge that,
notwithstanding anything in this Agreement to the contrary, this Agreement shall
not constitute an agreement on the part of Grey or obligate Grey to amend the
Indenture in violation of any of the Financing Agreements (a "PROHIBITED
INDENTURE AGREEMENT"), and to the extent that any agreement on the part of Grey
to take any action under this Agreement would, but for this paragraph (l),
constitute a Prohibited Indenture Agreement, such agreement shall be deemed to
be an agreement on the part of WPP to cause Grey (and not an agreement on the
part of Grey) to take such action.

            (m)   Release. Subject to the execution and delivery by WPP, Grey
and the Trustee of the Second Supplemental Indenture and, if the Consenting
Holder properly executes and delivers consents in respect of Debentures in
accordance with the Consent Solicitation, payment of the Consent Fee payable to
the Consenting Holder:

            (i)   the Consenting Holder hereby voluntarily and knowingly
      releases, acquits and forever discharges WPP, Grey and the Trustee, and
      each of their respective past, present or future subsidiaries, affiliates,
      stockholders, officers, directors, agents, servants, employees,
      representatives, advisors and attorneys (the "RELEASED PARTIES"), from,
      and waives all rights of action with respect to, any and all claims,
      causes of action, obligations, suits, debts, liens, demands, liabilities,
      damages, losses, costs and expenses (including reasonable attorneys' fees)
      of any kind, character or nature whatsoever (collectively "CLAIMS"), which
      the Consenting Holder in its capacity as a holder of Debentures may now
      have or may ever have against the Released Parties, whether accrued,
      absolute, contingent, unliquidated or otherwise, and whether known or
      unknown on this date, which have or may have arisen out of, or relate in
      any way to, the Merger, the Consent Solicitation, and the validity,
      execution and effectiveness of the Second Supplemental Indenture, other
      than Claims arising out of the performance or non-performance by WPP and
      Grey of their obligations under (1) the Second Supplemental Indenture, (2)
      the Indenture as modified by the Second Supplemental Indenture, (3) this
      Agreement (and the Letter) and (4) the Consent Solicitation. The
      provisions of this paragraph shall be binding upon the Consenting Holder
      and shall inure to the benefit of WPP, Grey and the Trustee and their
      respective successors and assigns; and

            (ii)  Each of WPP and Grey hereby voluntarily and knowingly
      releases, acquits and forever discharges the Consenting Holder in its
      capacity as a holder of Debentures and each of its past, present or future
      subsidiaries, affiliates, stockholders, officers, directors, agents,
      servants, employees, representatives, advisors and attorneys (the
      "CONSENTING HOLDER RELEASED PARTIES"), from, and waives all rights of
      action with respect to, any and all Claims which each of WPP or Grey or
      any of their respective subsidiaries (past, present or future) may now
      have or may ever have against the Consenting Holder Released Parties,
      whether accrued, absolute, contingent, unliquidated or otherwise, and
      whether known or unknown on this date, which have or may have arisen out
      of, or relate in any way to, the Merger, the Consent Solicitation, and the
      validity, execution or effectiveness of the Second Supplemental Indenture
      other than Claims arising out of the performance or non-performance by the
      Consenting Holder of its obligations under this Agreement (and the Letter)
      and the Consent Solicitation. The

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      provisions of this paragraph shall be binding upon WPP and Grey shall
      inure to the benefit of the Consenting Holder and its successors and
      assigns.

                            [signature pages follow]

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         IN WITNESS WHEREOF, each of the Parties has executed this Support
Agreement as of the date and year first above written.

                                        WPP GROUP PLC

                                        By:      _______________________________
                                                 Name:
                                                 Title:
<PAGE>
                                        GREY GLOBAL GROUP INC.

                                        By:      _______________________________
                                                 Name:
                                                 Title:
<PAGE>
                                        [CONSENTING HOLDER]

                                        By:      _______________________________
                                                 Name:
                                                 Title:
<PAGE>
                                                                         Annex A

                      Form of Second Supplemental Indenture

================================================================================

                             GREY GLOBAL GROUP INC.,

                                 WPP GROUP plc,

                            ABBEY MERGER CORPORATION

                                       and

                    AMERICAN STOCK TRANSFER & TRUST COMPANY,

                                   as Trustee

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

                          SECOND SUPPLEMENTAL INDENTURE

                               Dated as of [Date]

                             To the Indenture dated
                             as of October 28, 2003

           5% Contingent Convertible Subordinated Debentures due 2033

================================================================================
<PAGE>
                          SECOND SUPPLEMENTAL INDENTURE

         SECOND SUPPLEMENTAL INDENTURE, dated as of [______] (this "SECOND
SUPPLEMENTAL INDENTURE") among WPP GROUP plc, an English public limited company
("WPP"), ABBEY MERGER CORPORATION, a Delaware corporation and wholly owned
subsidiary of WPP ("ABBEY"), GREY GLOBAL GROUP INC., a Delaware corporation
("Grey"), and AMERICAN STOCK TRANSFER & TRUST COMPANY, a trust company organized
under the laws of the State of New York, as trustee (the "TRUSTEE"). All
capitalized terms used herein without definition shall have the meanings
specified in the Indenture and First Supplemental Indenture referred to below,
unless otherwise specified.

                                   WITNESSETH:

         WHEREAS, Grey has heretofore executed and delivered to the Trustee an
Indenture, dated as of October 28, 2003, as supplemented by the First
Supplemental Indenture dated as of the date of this Second Supplemental
Indenture (the "FIRST SUPPLEMENTAL INDENTURE"), pursuant to which Grey issued 5%
Contingent Convertible Subordinated Debentures due 2033 in the aggregate
principal amount of $150,000,000, convertible under certain circumstances into
shares of common stock, par value $0.01 per share, of Grey;

         WHEREAS, pursuant to an Agreement and Plan of Merger, dated as of
September 11, 2004, by and among WPP, Abbey and Grey (as amended, the "MERGER
AGREEMENT"), Grey will be merged with and into Abbey (the "MERGER"), with Abbey
being the surviving corporation in the Merger and remaining as a wholly owned
subsidiary of WPP, and pursuant to the Merger, each outstanding share of Common
Stock and each share of Limited Duration Class B Common Stock, par value $0.01
per share, of Grey will be converted into the right to receive merger
consideration in the form of cash or WPP shares in accordance with the terms of
the Merger Agreement;

         WHEREAS, pursuant to the First Supplemental Indenture, Abbey shall
expressly assume, from and after the Effective Time, all of Grey's obligations
as the "Company" under the Indenture and the Debentures, including the
obligations to make payment of the principal of, and interest on, the Debentures
and the performance of the other covenants under the Indenture, and from and
after the Effective Time, Abbey shall be deemed the "Company" for all purposes
under the Indenture and the Debentures;

         WHEREAS, pursuant the First Supplemental Indenture, WPP shall become,
from and after the Effective Time, a co-obligor, jointly and severally with the
Company, of substantially all of the obligations of the Company under the
Indenture and the Debentures;

         WHEREAS, pursuant to Section 11.11 of the Indenture, Grey, Abbey and
WPP are required to execute and deliver to the Trustee a supplemental indenture
providing (x) that the Holder of each Debenture shall have the right to convert
such Debenture into the kind and amount of merger consideration receivable upon
the Merger by a holder of the number of shares of Common Stock deliverable upon
conversion of such Debenture immediately prior to the record date of the Merger,
and (y) for adjustments to the Conversion Price that are as nearly
<PAGE>
equivalent as may be practicable to the adjustments to the Conversion Price
provided for in Article 11 of the Indenture;

         WHEREAS, pursuant to Section 9.02 of the Indenture, the Indenture and
the Debentures may be amended or supplemented with the consent of Holders of at
least a majority in aggregate principal amount of Debentures outstanding voting
as a single class;

         WHEREAS, the Holders of a majority in aggregate principal amount of
Debentures outstanding have duly consented to the adoption of the provisions
contained in this Second Supplemental Indenture, including that the adoption of
Article 3 of this Second Supplemental Indenture fully satisfies the obligations
of WPP, Abbey and Grey under Article 11 of the Indenture in connection with the
Merger;

         WHEREAS, in satisfaction of the requirements of Section 11.11 of the
Indenture, Article 3 of this Second Supplemental Indenture provides (a) that, at
any time after the Effective Time, the Holder of each Debenture shall have the
right to convert such Debenture into that amount of cash and number of WPP ADSs
representing WPP Ordinary Shares (as such terms are defined below) in the same
percentage that Holders of Common Stock electing share consideration are
entitled to receive in the aggregate under the Merger Agreement and (b) for
certain adjustments to the Conversion Price;

         WHEREAS, pursuant to Article 2 of this Second Supplemental Indenture,
certain amendments are being made to Sections 4.03, 4.07, 4.08, 5.01 and 5.02 of
the Indenture and new Sections 3.16, 3.17, 3.18, 3.19 and 4.09 are being added
to the Indenture;

         WHEREAS, in connection with the execution and delivery of this Second
Supplemental Indenture, the Trustee has received an Officers' Certificate and an
Opinion of Counsel as contemplated by Sections 7.02, 9.06, 11.11 and 12.04 of
the Indenture and evidence satisfactory to the Trustee of the consent of the
Holders described above;

         WHEREAS, following the Merger Abbey intends to change its name to "Grey
Global Group Inc."; and

         WHEREAS, all other acts necessary to make this Second Supplemental
Indenture a valid, binding and enforceable instrument, and all of the conditions
and requirements set forth in the Indenture, have been performed and fulfilled
and the execution and delivery of this Second Supplemental Indenture have been
in all respects duly authorized.

         NOW THEREFORE, the parties have executed and delivered this Second
Supplemental Indenture, and each of Grey, Abbey, WPP and the Trustee hereby
agrees for the other parties' benefit, and for the equal and ratable benefit of
the Holders, as follows:
<PAGE>
                                    ARTICLE 1

                                   DEFINITIONS

         Section 1.01 of the Indenture is hereby amended by inserting the
following new definitions in appropriate alphabetical order:

         "WPP ADSS" means American depositary shares of WPP.

         "WPP BOARD OF DIRECTORS" means the board of directors of WPP, or any
         authorized committee thereof.

         "WPP MARKET PRICE" means, with respect to WPP Ordinary Shares, the
         average of the Last Reported Sale Price (as defined in Section 11A.01
         of this Indenture) per share of WPP Ordinary Shares, and with respect
         to WPP ADSs, the average of the Last Reported Sale Price per share of
         ADSs, for 20 consecutive trading days before the record date with
         respect to any distribution, issuance or other event requiring such
         computation, appropriately adjusted (as determined in good faith by the
         WPP Board of Directors, whose determination shall be conclusive) to
         take into account the occurrence, during the period commencing on the
         first of such 20 consecutive trading days and ending on such record
         date, of any event requiring adjustment of the Conversion Price under
         Article 11A of this Indenture.

         "WPP ORDINARY SHARES" means the ordinary shares nominal value 10p each
         of WPP.

                                    ARTICLE 2

                              AMENDMENTS TO CERTAIN
                           PROVISIONS OF THE INDENTURE

         Section 2.01 Amendment of Section 4.03. Section 4.03 of the Indenture
is hereby amended to add following:

         "(c) From and after the Effective Time, the Company shall not be
         required to comply with Section 4.03(a) (other than the first and last
         sentence thereof). From and after the Effective Time, the Company shall
         file with the Trustee, within 15 days after WPP files such annual
         reports, information, documents and other reports with the SEC, copies
         of WPP's annual report and of the information, documents and other
         reports (or copies of such portions of any of the foregoing as the SEC
         may by rules and regulations prescribe) which WPP is required to file
         with the SEC pursuant to Section 13 or 15 (d) of the Exchange Act.

         (d) From and after the Effective Time, the Company shall not be
         required to comply with Section 4.03(b). From and after the Effective
         Time, any time when WPP is not subject to Section 13 or 15(d) of the
         Exchange Act, for so long as any Debentures remain outstanding, the
         Company shall furnish to the Holders and to prospective investors
<PAGE>
         designated by such Holders, upon their request, the information
         required to be delivered pursuant to Rule 144A(d) under the Securities
         Act."

         Section 2.02 Amendment of Section 4.07. Section 4.07 of the Indenture
is hereby amended by inserting the following as the last sentence of that
Section:

         "Subject to Article 5 hereof, the Company shall do or cause to be done
         all things necessary to preserve and keep in full force and effect its
         corporate existence or, from and after the Effective Time, its
         existence as any other legal entity organized under applicable law.
         From and after the Effective Time, nothing in this Indenture or in any
         of the Debentures shall prevent the Company from converting under
         applicable law from one type of entity organized under the law of any
         jurisdiction to another type of entity organized under the law of any
         jurisdiction (and such conversion shall not be deemed to constitute a
         consolidation, merger or a conveyance, transfer, sale or lease of
         property or assets for purposes of this Indenture)."

         Section 2.03 Amendment of Section 4.08. Section 4.08 of the Indenture
is hereby amended to add the following at the end of Section 4.08:

         "The prior provisions of this Section 4.08 shall be operative only with
         respect to periods prior to the Effective Time. The Company and the
         Holders and any beneficial owner of a Debenture, by purchasing the
         Debentures, agree that, from and after the Effective Time, (i) the
         Debentures are "contingent payment debt instruments" as defined in
         Treasury Regulations Section 1.1275-4(b), (ii) each Holder and any
         beneficial owner of a Debenture shall be bound by the Company's
         application of the Treasury Regulations to the Debentures, including
         the Company's determination (and, upon appropriate circumstances,
         redetermination) of the rate at which interest will be deemed to accrue
         on the Debentures for United States federal income tax purposes, which
         is the rate (as determined or redetermined by the Company) comparable
         to the rate at which the "issuer" (within the meaning of Treasury
         Regulation Section 1.1275-4(b)(4)(i)(A)) would borrow on a
         noncontingent, nonconvertible basis with terms and conditions otherwise
         comparable to the Debentures, (iii) each Holder and any beneficial
         owner of a Debenture shall use the projected payment schedule with
         respect to the Debentures determined (and, upon appropriate
         circumstances, redetermined) by the Company, as required by Treasury
         Regulations Section 1.1275-4(b)(4)(iv), to determine its interest
         accruals and adjustments as provided in Treasury Regulations Section
         1.1275-4(b), and (iv) the Company and each Holder and any beneficial
         owner of a Debenture will not take any position on a tax return
         inconsistent with (i), (ii), or (iii), unless required by applicable
         law.

         A Holder of Debentures may obtain the issue price, amount of original
         issue discount, issue date, yield to maturity, comparable yield and
         projected payment schedule for the Debentures from and after the
         Effective Time by submitting a written request for such information to
         the Company at the address specified in Section 12.02 of this
         Indenture."
<PAGE>
         Section 2.04 Amendment of Section 5.01. Clause (i) of Section 5.01 of
the Indenture is hereby amended to read in its entirety as follows:

         "(i) (x) if such consolidation, merger, conveyance, transfer, sale or
         lease is consummated prior to or as of the Effective Time, the Person
         formed by such consolidation or into or with which the Company is
         merged or the Person to which the Company's properties and assets are
         conveyed, transferred, sold or leased, is a corporation organized and
         existing under the laws of the United States, any State thereof or the
         District of Columbia or (y) if such consolidation, merger, conveyance,
         transfer, sale or lease is consummated after the Effective Time, the
         Person formed by such consolidation or into or with which the Company
         is merged or the Person to which the Company's properties and assets
         are conveyed, transferred, sold or leased, is a corporation or other
         legal entity organized under the laws of any jurisdiction; and in the
         case of (x) or (y), if the Person formed by such consolidation or into
         or with which the Company is merged or the Person to which the
         Company's properties and assets are conveyed, transferred, sold or
         leased is other than the Company, such Person has expressly assumed all
         of the Company's obligations, including the payment of the principal
         of, and interest on, the Debentures and the performance of the other
         covenants under Article 4 of this Indenture;"

         Section 2.05. Amendment to Section 5.02. Section 5.02 of the Indenture
is hereby amended to substitute for each reference therein to "the successor
corporation" the following: "the successor corporation (if such consolidation,
merger, conveyance, transfer, sale or lease is consummated prior to or as of the
Effective Time) or the successor Person (if such consolidation, merger,
conveyance, transfer, sale or lease is consummated after the Effective Time)".

         Section 2.06 Addition of Sections 3.16, 3.17, 3.18 and
3.19. The Indenture is hereby amended to add the following Sections 3.16, 3.17,
3,18 and 3.19:

         "3.16 Purchase of Debentures at Option of the Holder for Cash.

         (a) After the Effective Time, at each of October 28, 2008, October 28,
2010 and October 28, 2013 (each a "PURCHASE DATE"), outstanding Debentures shall
be repurchased by the Company, at the option of the Holder thereof, at a
purchase price in cash (the "PURCHASE PRICE") equal to 100% of the principal
amount of the Debentures to be purchased, plus accrued and unpaid interest
(including Additional Amounts and Contingent Interest, if any) thereon, up to
and including the applicable Purchase Date.

         (b) The Company shall mail to all Holders of record of the Debentures a
notice (a "PURCHASE NOTICE") at least 20 Business Days prior to each Purchase
Date. The Company shall promptly furnish to the Trustee a copy of such notice.
Each Purchase Notice shall include a form of Purchase Acceptance Notice to be
completed by a Holder and shall state, as applicable:

         (i) the Purchase Price and the cash and/or securities for which each
$1,000 of principal amount of Debentures is then convertible;
<PAGE>
         (ii) the name and address of the Paying Agent and Conversion Agent;

         (iii) that Debentures as to which a Purchase Acceptance Notice has been
given may be converted only if the Purchase Acceptance Notice has been withdrawn
in accordance with the terms of this Indenture;

         (iv) that Debentures must be surrendered to the Paying Agent to collect
payment of the Purchase Price and accrued but unpaid interest and Contingent
Interest and Additional Amounts, if any;

         (v) that the Purchase Price for any Debentures as to which a Purchase
Acceptance Notice has been given and not withdrawn, together with any accrued
and unpaid interest, including Contingent Interest and Additional Amounts, if
any, with respect thereto, shall be paid promptly following the later of the
Purchase Date and the time of surrender of such Debentures as described in (iv);

         (vi) the Purchase Date;

         (vii) the procedures the Holder must follow under this Section 3.16 to
require the Company to repurchase such Holder's Debentures;

         (viii) that, unless the Company defaults in making payment of such
Purchase Price, interest (including Contingent Interest and Additional Amounts,
if any) on Debentures covered by any Purchase Acceptance Notice will cease to
accrue on and after the Purchase Date;

         (ix) the CUSIP number of the Debentures; and

         (x) the procedures for withdrawing a Purchase Acceptance Notice.

         At the Company's request and at the Company's expense, the Trustee
shall give the Purchase Notice in the Company's name; provided, however, that,
in all cases, the text of the Purchase Notice shall be prepared by or at the
direction of the Company.

         (c) For a Debenture to be so repurchased at the option of the Holder in
connection with a Purchase Date, the Paying Agent must receive such Debenture
duly endorsed for transfer, together with the form entitled "Form of Purchase
Acceptance Notice" (a "PURCHASE ACCEPTANCE NOTICE") on the reverse thereof duly
completed, together with such Debenture duly endorsed for transfer, after the
mailing of the Purchase Notice with respect to such Purchase Date and prior to
the close of business on such Purchase Date, subject to extension to comply with
applicable law (such extension, if any, to be determined solely by the Company).
The Purchase Acceptance Notice must state: (i) if certificated Debentures have
been issued, the certificate numbers of the Debentures to be delivered for
repurchase; (ii) the portion of the principal amount of Debentures to be
repurchased, which must be $1,000 or an integral multiple thereof; and (iii)
that the Debentures are to be repurchased by the Company pursuant to Section
3.16 of this Indenture. All questions as to the validity, eligibility (including
time of receipt) and acceptance of any Debenture for redemption shall be
determined by the Company, whose determination shall be final and binding.
<PAGE>
         The Company shall purchase from the Holder thereof, pursuant to this
Section 3.16, a portion of a Debenture if the principal amount of such portion
is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that
apply to the purchase of all of a Debenture also apply to the purchase of such
portion of such Debenture.

         Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.16 shall be consummated by the delivery of the consideration to
be received by the Holder promptly following the later of the applicable
Purchase Date and the time of delivery of the Debentures to the Paying Agent in
accordance with this Section 3.16.

         Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Purchase Acceptance Notice contemplated by this Section
3.16 (c) shall have the right to withdraw such Purchase Acceptance Notice at any
time prior to the close of business on the applicable Purchase Date by delivery
of a written notice of withdrawal to the Paying Agent in accordance with Section
3.17.

         The Paying Agent shall promptly notify the Company of the receipt by it
of any Purchase Acceptance Notice or written withdrawal thereof.

         Notwithstanding anything herein to the contrary, the Company shall not
be required to make an offer pursuant to this Section 3.16 on any Purchase Date
if, not more than 20 Business Days prior to such Purchase Date, the Company has
made an offer to purchase (an "ALTERNATE PURCHASE OFFER") any and all Debentures
validly tendered at a cash price equal to or higher than the Purchase Price
(which offer refers to this Section 3.16 and discloses the requirement of the
Company to purchase Debentures pursuant hereto and otherwise satisfies the
requirements of Section 3.16(b)) and purchases all Debentures properly tendered
in accordance with the terms of such Alternate Purchase Offer.

         3.17 Effect of Purchase Acceptance Notice.

         Upon receipt by the Paying Agent of the Purchase Acceptance Notice
specified in Section 3.16(c) during the period specified in Section 3.16(c), the
Holder of the Debenture in respect of which such Purchase Acceptance Notice was
given shall (unless such Purchase Acceptance Notice is withdrawn as specified in
the following two paragraphs) thereafter be entitled to receive solely the
Purchase Price, together with accrued but unpaid interest (including Contingent
Interest and Additional Amounts, if any) thereon, to and including the
applicable Purchase Date with respect to such Debenture. Such Purchase Price,
together with accrued but unpaid interest (including Contingent Interest and
Additional Amounts, if any) thereon, to and not including the applicable
Purchase Date shall be paid to such Holder, subject to receipt of funds by the
Paying Agent, promptly following the later of (x) the applicable Purchase Date
(provided that the conditions in Section 3.16 have been satisfied) and (y) the
book-entry transfer or time of delivery of such Debenture to the Paying Agent by
the Holder thereof in the manner required by Section 3.16(c). Debentures in
respect of which a Purchase Acceptance Notice has been given by the Holder
thereof may not be converted pursuant to Article 11A hereof on or after the date
of the delivery of such Purchase Acceptance Notice unless such Purchase
Acceptance Notice has first been validly withdrawn as specified in the following
two paragraphs.
<PAGE>
         A Purchase Acceptance Notice may be withdrawn by means of a written
notice of withdrawal delivered to the office of the Paying Agent in accordance
with the Purchase Acceptance Notice prior to the close of business on the
applicable Purchase Date. The notice of withdrawal must state:

         (i) the principal amount of the Debentures with respect to which such
notice of withdrawal is being submitted;

         (ii) if certificated Debentures have been issued, the certificate
numbers of the withdrawn Debentures; and

         (iii) the principal amount, if any, of such Debenture which remains
subject to the original Purchase Acceptance Notice and which has been or will be
delivered for purchase by the Company.

         The Company shall not purchase any of the Debentures pursuant to
Section 3.16 if there has occurred, prior to, on or after, as the case may be,
the giving, by the Holders of such Debentures, of the required Purchase
Acceptance Notice, and is continuing an Event of Default (other than a default
in the payment of the Purchase Price). The Paying Agent will promptly return to
the respective Holders thereof any Debentures (x) with respect to which a
Purchase Acceptance Notice has been withdrawn in compliance with this Indenture,
or (y) held by it during the continuance of an Event of Default (other than a
default in the payment of the Purchase Price) in which case, upon such return,
the Purchase Acceptance Notice with respect thereto shall be deemed to have been
withdrawn.

         3.18 Deposit of Purchase Price.

         No later than the first Business Day following each Purchase Date, the
Company shall deposit with the Paying Agent (or, if the Company or a subsidiary
or an Affiliate of either of them is acting as the Paying Agent, shall segregate
and hold in trust as provided in Section 2.04) an amount of money (in
immediately available funds) sufficient to pay the aggregate Purchase Price,
together with accrued but unpaid interest (including Contingent Interest and
Additional Amounts, if any) thereon to and including the Purchase Date, of all
the Debentures or portions thereof purchased as of the Purchase Date.

         If the Paying Agent holds money sufficient to pay the Purchase Price of
the Debentures on the first Business Day following a Purchase Date, then, after
such Purchase Date: (a) such Debentures (or portions thereof) will cease to be
outstanding and interest will cease to accrue (whether or not book-entry
transfer of the Debentures has been made or the Debentures have been delivered
to the Paying Agent); and (b) all other rights of the Holders will terminate
(other than the right to receive the Purchase Price upon transfer or delivery of
the Debentures).

         3.19 Repayment to the Company.

         The Paying Agent shall return to the Company any cash that remains
unclaimed as provided in paragraph 6A of the Debentures, together with interest
or dividends, if any, thereon, held by it for the payment of the Purchase Price
and accrued but unpaid interest (including
<PAGE>
Contingent Interest and Additional Amounts, if any); provided, however, that to
the extent that the aggregate amount of cash deposited by the Company pursuant
to Section 3.18 exceeds the aggregate Purchase Price of the Debentures or
portions thereof which the Company is obligated to purchase as of the Purchase
Date and accrued but unpaid interest thereon (including Contingent Interest and
Additional Amounts, if any), then, unless otherwise agreed in writing with the
Company, promptly after the Purchase Date, the Paying Agent shall return any
such excess to the Company."

         Section 2.07 Amendment to Section 3.15 of the Indenture. Section 3.15
of the Indenture is hereby amended from and after the Effective Time so that
each reference to "Section 3.11" is replaced with a reference to "Section 3.11
or 3.16".

         Section 2.08 Addition of Section 4.09 to the Indenture. The Indenture
is hereby amended from and after the Effective Time to add the following Section
4.09:

         4.09 Normal Call Premium.

         "Amounts paid upon conversion of a Debenture by a Holder pursuant to
         Section 11A.01 hereof that exceed the "adjusted issue price" (as
         defined in Treasury Regulation Section 1.1275-1(b)) of such Debenture
         shall be deemed to be a call premium specified in dollars under the
         terms of this Indenture, but such deemed amounts shall not exceed the
         greater of (i) a normal call premium on a nonconvertible obligation
         which is comparable to such Debenture, determined under Treasury
         Regulation Section 1.249-1(d) (or any successor thereto) and (ii) an
         amount, determined under Treasury Regulation Section 1.249-1(e) (or any
         successor thereto), that is attributable to the cost of borrowing and
         is not attributable to the conversion feature."

         Section 2.09 Addition of Paragraph 6A to the Debentures. A new
paragraph 6A is hereby added to the Debentures, which shall read in its entirety
as follows:

         "6A. PURCHASE AT THE OPTION OF THE HOLDER FOR CASH. After the Effective
Time, at the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall become obligated to purchase the Debentures held by
such Holder on each of October 28, 2008, October 28, 2010 and October 28, 2013
(each, a "PURCHASE DATE") for a Purchase Price equal to 100% of the principal
amount thereof, plus accrued but unpaid interest (including Contingent Interest
and Additional Amounts, if any) thereon, up to and including the applicable
Purchase Date. Holders have the right to withdraw any Purchase Acceptance Notice
by delivering to the Paying Agent a written notice of withdrawal in accordance
with the provisions of the Indenture.

         If cash sufficient to pay the Purchase Price on all Debentures or
portions thereof to be purchased as of a Purchase Date is held by the Paying
Agent within one Business Day following such Purchase Date, interest (including
Contingent Interest and Additional Amounts, if any) shall cease to accrue on
such Debentures (or portions thereof) after such Purchase Date (whether or not
book-entry transfer of the Debentures has been made or the Debentures have been
delivered
<PAGE>
to the Paying Agent), and the Holder thereof shall have no other rights as such
other than the right to receive the Purchase Price upon surrender of such
Debentures."

         Section 2.10 Addition of Form of Purchase Acceptance Notice to the
Debentures. The Debentures are amended from and after the Effective Time to add
the following "Form of Purchase Acceptance Notice" after the "Form of Holder
Change of Control Acceptance Notice" on the reverse of the Debentures:
<PAGE>
                       FORM OF PURCHASE ACCEPTANCE NOTICE

TO:      GREY GLOBAL GROUP INC.
         c/o WPP Group USA, Inc.
         125 Park Avenue
         New York, NY  10017
         Attn:  Corporate Secretary
         Telecopier No.  (212) _______

         The undersigned registered owner of this Debenture hereby irrevocably
acknowledges receipt of a notice from Grey Global Group Inc. (the "COMPANY") as
to an upcoming Purchase Date and requests and instructs the Company to repay the
entire principal amount of this Debenture, or the portion thereof (the principal
amount of which is an integral multiple of $1,000) below designated, in
accordance with the terms of this Debenture and the Indenture referred to in
this Debenture, together with accrued but unpaid interest (including Contingent
Interest and Additional Amounts, if any) to, but excluding, such date, to the
registered holder hereof.

Dated:___________________               Your Name: _____________________________
                                        (Print your name exactly as it appears
                                        on the face of this Debenture)

                                        Your Signature:
                                        ________________________________________
                                        (Sign exactly as your name appears on
                                        the face of this Debenture)

                                        Signature Guarantee*: __________________

                                        Social Security or other Taxpayer
                                        Identification Number:

                                        DTC Participant Number: ________________

                  Certificate Number: ________________________

*Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).

Principal amount to be repaid (if less than all): $_____________________________
<PAGE>
                                    ARTICLE 3

                          CONVERSION OF THE SECURITIES

         Section 3.01 Amendment to Article 11. Article 11 of the Indenture is
hereby amended to add the following:

         "11.15 Effectiveness.

         This Article 11 shall be null and void and have no further force and
         effect from and after the Effective Time."

         Section 3.02 Addition of Article 11A. The Indenture is hereby amended
to add the following Article 11A in satisfaction of the requirements of Section
11.11 of the Indenture in connection with the Merger:

                                  "ARTICLE 11A

                          CONVERSION OF THE SECURITIES

11A.01 Conversion Privilege.

         Subject to the provisions of this Article 11A, a Holder may at any time
after the Effective Time, prior to the close of business on the Business Day
immediately preceding October 15, 2033 (the "CONVERSION EXPIRATION DATE")
convert each $1,000 principal amount of Debentures into (i) the Cash Conversion
Amount in cash and (ii) WPP ADSs representing a number of WPP Ordinary Shares
equal to the Stock Conversion Amount divided by the Conversion Price in effect
on the applicable Conversion Date. The "CONVERSION PRICE" shall, after the
Effective Time, be initially equal to the Initial Post-Merger Conversion Price,
subject to adjustment pursuant to Section 11A.06.

         "CASH CONVERSION AMOUNT" shall be equal to (x) $1,045.60 multiplied by
(y) one (1) minus the Proration Percentage.

         "INITIAL POST-MERGER CONVERSION PRICE" shall be equal to $8.84 per WPP
Ordinary Share.

         "PRORATION PERCENTAGE" shall be equal to the result (expressed as a
decimal) obtained by dividing (x) the number of Stock Electing Shares (as
defined in the Merger Agreement as in effect as of February 21, 2005) converted
in the Merger into the right to receive WPP ADSs or WPP Ordinary Shares, divided
by (y) the total number of Stock Electing Shares; provided, that the Proration
Percentage shall not be less than 0.5 nor more than 1.00 and if the total number
of Stock Electing Shares is 0 then the Proration Percentage shall be 1.00.

         "STOCK CONVERSION AMOUNT" shall be equal to (x) $1,000 multiplied by
(y) the Proration Percentage.
<PAGE>
         As promptly as practicable after the Effective Time, WPP shall give
written notice (the "MERGER CONSIDERATION NOTICE") to the Trustee and make a
public announcement setting forth the Effective Time, the Proration Percentage,
the Cash Conversion Amount and the Stock Conversion Amount.

         A Debenture in respect of which a Holder elects to exercise its option
to require repurchase pursuant to Section 3.11 or 3.16 may be converted only if
such Holder withdraws its election in accordance with Section 3.11(d) and
Section 3.12 or Section 3.16(c) and Section 3.17, as applicable. A Holder of
Debentures is not entitled to any rights of a holder of WPP ADSs until such
Holder has converted its Debentures to WPP ADSs, and only to the extent such
Debentures are deemed to have been converted to WPP ADSs under this Article 11A.

         The "LAST REPORTED SALE PRICE" of the WPP Ordinary Shares on any date
means the closing sale price per share (or if no closing sale price is reported,
the average of the bid and asked prices or, if more than one in either case, the
average of the average bid and the average asked prices) on such date as
reported by The London Stock Exchange or, if the WPP Ordinary Shares are not
reported by The London Stock Exchange, as reported in composite transactions for
the principal securities exchange on which the WPP Ordinary Shares are traded.
If the WPP Ordinary Shares are not reported by The London Stock Exchange and not
listed for trading on a securities exchange on the relevant date, the "LAST
REPORTED SALE PRICE" of the WPP Ordinary Shares will be the average of the
mid-point of the last bid and asked prices for the WPP Ordinary Shares on the
relevant date quoted by each of at least three independent nationally recognized
investment banking firms selected by WPP for this purpose. The "Last Reported
Sale Price" of the WPP ADSs on any date means the closing sale price per share
(or if no closing sale price is reported, the average of the bid and asked
prices or, if more than one in either case, the average of the average bid and
the average asked prices) on such date as reported by The Nasdaq National Market
or, if the WPP ADSs are not reported by The Nasdaq National Market, as reported
in composite transactions for the principal U.S. securities exchange on which
the WPP ADSs are traded. If the WPP ADSs are not reported by The Nasdaq National
Market and not listed for trading on a U.S. national or regional securities
exchange on the relevant date, the "last reported sale price" will be the last
quoted bid price for the WPP ADSs in the over-the-counter market on the relevant
date as reported by the National Quotation Bureau Incorporated or similar
organization. If the WPP ADSs are not so quoted, the "Last Reported Sale Price"
will be the average of the mid-point of the last bid and asked prices for the
WPP ADSs on the relevant date quoted by each of at least three independent
nationally recognized investment banking firms selected by WPP for this purpose.

         A "TRADING DAY" means, with respect to WPP Ordinary Shares, a day
during which trading in securities generally occurs on The London Stock Exchange
or, if the WPP Ordinary Shares are not then listed on The London Stock Exchange,
on the principal other securities exchange on which the WPP Ordinary Shares are
then listed or, if the WPP Ordinary Shares are not then listed on a securities
exchange, on the principal other market on which the WPP Ordinary Shares are
then traded. A "Trading Day" with respect to the WPP ADSs means a day during
which trading in securities generally occurs on The Nasdaq National Market or,
if the WPP ADSs are not then listed on The Nasdaq National Market, on the
principal other U.S. national or regional securities exchange on which the WPP
ADSs are then listed or, if the WPP
<PAGE>
ADSs are not then listed on a national or regional securities exchange, on the
principal other market on which the WPP ADSs are then traded.

         A "DIVIDEND PAYMENT PERIOD" shall commence on each date on which WPP
has announced that it (i) will make a Below Market Issuance, (ii) will
distribute a Cash Dividend or an Asset Distribution, which distribution has a
per share value as determined in good faith by the WPP Board of Directors
exceeding 10% of the Last Reported Sale Price of WPP Ordinary Shares on the
trading day immediately preceding the declaration date for such distribution or
(iii) has commenced a Tender Offer, and end on the earlier of (a) the close of
business on the business day immediately prior to the ex-dividend date with
respect to such distribution or dividend (or in the case of a Tender Offer, at
the close of business on the Business Day immediately prior to the expiration of
the Tender Offer) and (b) the close of business on the first business day after
the day on which WPP makes a public announcement that such distribution or
dividend will not be issued or that such Tender Offer has been terminated.

         A Holder may convert a portion of a Debenture equal to $1,000 or any
integral multiple thereof. Provisions of this Indenture that apply to conversion
of all of a Debenture also apply to conversion of a portion of a Debenture.

         If a Debenture is called for redemption pursuant to Article 3, the
right to convert such Debenture shall terminate at the close of business on the
second Business Day before the Redemption Date for such Debenture (unless the
Company shall default in making the redemption payment then due, in which case
the conversion right shall terminate on the date such Default is cured and such
Debenture is redeemed).

11A.02 Conversion Procedure.

         To convert a Debenture after the Effective Time, a Holder must satisfy
the requirements in paragraph 8 of the Debentures and (i) complete and manually
sign the irrevocable conversion notice on the back of the Debenture and deliver
such notice to the Conversion Agent, (ii) surrender the Debenture to the
Conversion Agent, (iii) furnish appropriate endorsements and transfer documents
if required by the Registrar or the Conversion Agent, (iv) pay any transfer or
other tax, if required by Section 11A.04 and (v) if the Debenture is held in
book-entry form, complete and deliver to the Depositary appropriate instructions
pursuant to the Depositary's book-entry conversion programs. After the Effective
Time, the date on which the Holder satisfies all of the foregoing requirements
is the "Conversion Date." As soon as practicable after the Conversion Date and
in any event within five Business Days, WPP shall deliver to the Holder through
the Conversion Agent (a) either a receipt or a book entry notation of the number
of whole WPP ADSs issuable upon the conversion pursuant to Section 11A.05, (b)
the aggregate Cash Conversion Amount payable upon such conversion and (c) cash
in lieu of any fractional WPP ADSs.

         After the Effective Time, the Person in whose name the Debenture is
registered shall be deemed to be a holder on the Conversion Date of the WPP ADSs
for which the Debenture is converted on such Conversion Date; provided, however,
that no surrender of a Debenture on any date when the transfer books relating to
the WPP ADSs shall be closed shall be effective to
<PAGE>
constitute the Person or Persons entitled to receive WPP ADSs upon such
conversion as the registered holder or holders of such WPP ADSs on such date,
but such surrender shall be effective to constitute the Person or Persons
entitled to receive such WPP ADSs as the registered holder or holders thereof
for all purposes at the close of business on the next succeeding day on which
such transfer books are open; provided, further, that such conversion shall be
at the Conversion Price in effect on the date that such Debenture shall have
been surrendered for conversion, as if such transfer books had not been closed.
Upon conversion of a Debenture, such Person shall no longer be a Holder of such
Debenture.

         Accrued interest (including Contingent Interest, accrued Tax Original
Issue Discount and Additional Amounts, if any) on a Debenture shall not be
cancelled, extinguished or forfeited but rather shall, except as otherwise set
forth herein, be deemed paid by an applicable portion of the WPP ADSs issued
upon conversion of such Debenture. Except as set forth in the preceding
sentence, no payment or adjustment will be made for accrued interest (including
Contingent Interest or Additional Amounts, if any) on a converted Debenture or
for dividends or distributions on WPP ADSs issued upon conversion of a Debenture
(provided that the WPP ADSs received upon conversion of Debentures shall
continue to accrue Additional Amounts, as applicable, in accordance with the
Registration Rights Agreement and shall be entitled to receive, at the next
Interest Payment Date, any accrued but unpaid Additional Amounts with respect to
the converted Debentures), but if any Holder surrenders a Debenture for
conversion between the record date for the payment of an installment of interest
and the next Interest Payment Date, then, notwithstanding such conversion, the
interest (including Contingent Interest or Additional Amounts, if any), payable
on such Interest Payment Date shall be paid to the Holder of such Debenture on
such Interest Payment Date. In such event, such Debenture, when surrendered for
conversion, must be accompanied by delivery of a check payable to the Conversion
Agent in an amount equal to the interest (including Contingent Interest or
Additional Amounts, if any), payable on such Interest Payment Date on the
portion so converted. If such payment does not accompany such Debenture, the
Debenture shall not be converted; provided, however, that no such check shall be
required if such Debenture has been called for redemption on a redemption date
within the period between and including such record date and such Interest
Payment Date, or if such Debenture is surrendered for conversion on the Interest
Payment Date. If the Company defaults in the payment of interest (including
Contingent Interest or Additional Amounts, if any) payable on the Interest
Payment Date, the Conversion Agent shall repay such funds to the Holder.

         No fractional WPP ADSs shall be issued upon conversion of Debentures.
If more than one Debenture shall be surrendered for conversion at one time by
the same holder, the number of full WPP ADSs that shall be issuable upon
conversion shall be computed on the basis of the aggregate principal amount of
the Debentures (or specified portions thereof to the extent permitted hereby) so
surrendered. If any fractional WPP ADS would be issuable upon the conversion of
any Debenture or Debentures, WPP shall make a payment in lieu thereof in cash
based on the current WPP Market Price of a WPP ADSs on the Conversion Date.

         Upon surrender of a Debenture that is converted in part, the Company
and WPP shall execute, and the Trustee shall authenticate and deliver to the
Holder, a new Debenture equal in principal amount to the unconverted portion of
the Debenture surrendered.
<PAGE>
11A.03 Adjustments Below Nominal Value.

         Before taking any action which would cause an adjustment decreasing the
Conversion Price so that the WPP Ordinary Shares represented by the WPP ADSs
issuable upon conversion of the Debentures would be issued for less than the
nominal value of such WPP Ordinary Shares, WPP will take all corporate action
which may be necessary in order that WPP may validly and legally issue fully
paid or credited as fully paid and nonassessable shares of such WPP Ordinary
Shares represented by WPP ADSs issuable upon conversion of the Debentures at
such adjusted Conversion Price.

11A.04 Taxes on Conversion.

         If a Holder converts a Debenture, the Company or WPP shall pay any
documentary, stamp or similar issue or transfer tax due on the issue of WPP
Ordinary Shares or WPP ADSs upon such conversion. However, the Holder shall pay
any such tax which is due because the Holder requests the shares to be issued in
a name other than the Holder's name. Each of the Company, WPP, the depositary
for the WPP ADSs and the Conversion Agent may refuse to deliver the WPP Ordinary
Shares or receipts representing the WPP ADSs being issued in a name other than
the Holder's name until the Conversion Agent receives a sum sufficient to pay
any tax which will be due because the shares are to be issued in a name other
than the Holder's name. Nothing herein shall preclude any tax withholding
required by law or regulations.

11A.05 WPP to Provide WPP Ordinary Shares and WPP ADSs.

         WPP shall from time to time after the Effective Time as may be
necessary, reserve, out of its authorized but unissued WPP Ordinary Shares, a
sufficient number of WPP Ordinary Shares to permit the conversion of all
outstanding Debentures into WPP ADSs issuable upon conversion of the Debentures.

         The WPP ADSs to be issued upon conversion of Debentures bearing a
legend as provided in Section 2.06(f) shall bear a legend substantially in the
following form:

                  "THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
         TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
         ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY MAY
         NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
         REGISTRATION OR AN APPLICABLE EXEMPTION FROM THE REGISTRATION
         REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER OF THIS SECURITY IS
         HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
         EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
         PROVIDED BY RULE 144A THEREUNDER.

                  THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
         COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR
         OTHERWISE TRANSFERRED, ONLY (I) TO A PERSON WHOM THE SELLER
<PAGE>
         REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
         RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
         REQUIREMENTS OF RULE 144A, (II) PURSUANT TO AN EXEMPTION FROM
         REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
         (IF AVAILABLE) OR (III) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
         UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (III) IN
         ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
         UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
         REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM THE HOLDER OF
         THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE."

         WPP covenants that all WPP Ordinary Shares represented by the WPP ADSs
delivered upon conversion of the Debentures shall be newly issued shares or
treasury shares, shall be duly authorized, validly issued, and fully paid or
credited as fully paid, and no further contribution in respect thereof will be
required to be made to WPP by the holders thereof when issued, and shall be free
from preemptive rights and free of any lien or adverse claim. WPP shall take
such action from time to time as shall be necessary so that the aggregate
nominal value of the WPP Ordinary Shares issued upon conversion of any Debenture
or underlying the WPP ADSs issued upon conversion of any Debentures shall at all
times be equal to or less than the Conversion Price then in effect.

         WPP shall cause adequate availability to be maintained under a
Registration Statement with respect to the WPP ADSs as necessary to allow
conversion of the Debentures.

         WPP will endeavor promptly to comply with all federal and state
securities laws regulating the offer and delivery of WPP Ordinary Shares or WPP
ADSs upon conversion of Debentures, if any, and will list or cause to have
quoted such WPP Ordinary Shares and WPP ADSs on each national securities
exchange or in the over-the-counter market or such other market on which the WPP
Ordinary Shares or WPP ADSs are then listed or quoted.

11A.06 Adjustment of Conversion Price.

         The Conversion Price shall be adjusted from time to time in connection
with the occurrence of any of the following events after the Effective Time,
without duplication, as follows:

                  (a)      In case WPP shall pay or make a dividend or other
         distribution on WPP Ordinary Shares in WPP Ordinary Shares to all or
         substantially all holders of WPP Ordinary Shares, then the Conversion
         Price in effect at the opening of business on the day following the
         date fixed for the determination of shareholders entitled to receive
         such dividend or other distribution shall be reduced by multiplying
         such Conversion Price by a fraction the numerator of which shall be the
         number of WPP Ordinary Shares outstanding at the close of business on
         the date fixed for such determination and the denominator of which
         shall be the sum of such number of shares and the total number of
         shares constituting such dividend or other distribution, such reduction
         to become effective
<PAGE>
         immediately after the opening of business on the day following the date
         fixed for such determination. For the purposes of this subparagraph
         (a), the number of WPP Ordinary Shares at any time outstanding shall
         not include shares held in the treasury of WPP (except to the extent
         such dividend or distribution is being made with respect to such
         shares) but shall include shares issuable in respect of scrip
         certificates issued in lieu of fractions of WPP Ordinary Shares.

                  (b)      In case the outstanding WPP Ordinary Shares shall be
         subdivided into a greater number of WPP Ordinary Shares, then the
         Conversion Price in effect at the opening of business on the day
         following the day upon which such subdivision becomes effective shall
         be proportionately reduced, and, conversely, in case the outstanding
         WPP Ordinary Shares shall be combined into a smaller amount of WPP
         Ordinary Shares, then the Conversion Price in effect at the opening of
         business on the day following the day upon which such combination
         becomes effective shall be proportionately increased, such reduction or
         increase, as the case may be, to become effective immediately after the
         opening of business on the day following the day upon which such
         subdivision or combination becomes effective.

                  (c)      In case WPP shall issue to all or substantially all
         holders of its WPP Ordinary Shares, rights, warrants or options
         entitling such holders (for a period commencing no earlier than the
         record date described below and expiring not more than 60 days after
         such record date) to subscribe for or purchase WPP Ordinary Shares (or
         securities convertible into WPP Ordinary Shares) at a price per share
         less than the WPP Market Price with respect to the WPP Ordinary Shares
         at the record date for the determination of shareholders entitled to
         receive such rights, warrants or options (a "BELOW MARKET ISSUANCE"),
         the Conversion Price in effect immediately prior thereto shall be
         adjusted so that the Conversion Price shall equal the price determined
         by multiplying the Conversion Price in effect immediately prior to such
         record date by a fraction, the numerator of which shall be the number
         of WPP Ordinary Shares outstanding on such record date, plus the number
         of shares that the aggregate subscription or purchase price for the
         total number of WPP Ordinary Shares offered by the rights, warrants or
         options so issued (or the aggregate conversion price of the convertible
         securities offered by such rights, warrants or options) would purchase
         at such WPP Market Price, and the denominator of which shall be the
         number of WPP Ordinary Shares outstanding on such record date plus the
         number of additional WPP Ordinary Shares offered by such rights,
         warrants or options (or into which the convertible securities so
         offered by such rights, warrants or options are convertible). Such
         adjustment shall be made successively whenever any such rights,
         warrants or options are issued, and shall become effective immediately
         after such record date. If at the end of the period during which such
         rights, warrants or options are exercisable not all rights, warrants or
         options shall have been exercised, the adjusted Conversion Price shall
         be immediately readjusted to what it would have been upon application
         of the foregoing adjustment substituting the number of additional WPP
         Ordinary Shares actually issued (or the number of WPP Ordinary Shares
         issuable upon conversion of convertible securities actually issued) for
         the total number of shares of WPP Ordinary Shares offered (or the
         convertible securities offered).
<PAGE>
                  (d)      In case WPP shall distribute to all or substantially
         all holders of WPP Ordinary Shares (i) WPP's equity securities (other
         than WPP Ordinary Shares), (ii) evidences of WPP's indebtedness and/or
         (iii) other assets (including securities, but excluding (1) any rights,
         warrants or options referred to in clause (c) above, (2) any rights or
         warrants to acquire any capital stock of any entity other than WPP, (3)
         any dividends or distributions in connection with WPP's liquidation,
         dissolution or winding-up, (4) any dividends payable solely in cash
         that may from time to time be declared by the WPP Board of Directors
         and (5) any dividends or distributions referred to in clause (a) above)
         (each of (i) , (ii) and (iii) , an "ASSET DISTRIBUTION"), in which
         case, the Conversion Price shall be adjusted so that the adjusted
         Conversion Price shall equal the number determined by multiplying the
         Conversion Price in effect on the record date with respect to the Asset
         Distribution by the fraction of "A/B," where "A" is equal to the Last
         Reported Sale Price (as defined above) of WPP Ordinary Shares on such
         record date minus the fair market value on such record date (as
         determined in good faith by WPP Board of Directors, whose determination
         shall be conclusive evidence of such fair market value) of the portion
         of the Asset Distribution applicable to one share of WPP Ordinary
         Shares, and "B" is equal to such Last Reported Sale Price.

                  (e)      In case WPP shall distribute or dividend to all or
         substantially all holders of WPP Ordinary Shares, cash (a "CASH
         DIVIDEND") that when combined with all other Cash Dividends paid with
         respect to such calendar year with respect to which such Cash Dividend
         is paid exceeds the applicable Per Share Dividend Threshold (the amount
         of such excess, the "EXCESS DIVIDEND") the Conversion Price shall be
         reduced so that the adjusted Conversion Price shall equal the number
         determined by multiplying the Conversion Price in effect on the record
         date with respect to the Cash Dividend by the fraction of "B/A," where
         "A" is equal to the Last Reported Sale Price of WPP Ordinary Shares on
         such record date, and "B" is equal to such last reported sale price
         minus the amount of Excess Dividend applicable to one WPP Ordinary
         Share. The "PER SHARE DIVIDEND THRESHOLD" shall be equal to the total
         amount of pence sterling per WPP Ordinary Share actually paid by WPP as
         a cash dividend per WPP Ordinary Share with respect to calendar year
         2004; and with respect to each subsequent calendar year, the Per Share
         Dividend Threshold shall be equal to the Per Share Dividend Threshold
         applicable to the prior calendar year multiplied by 1.125; provided,
         however, that the Per Share Dividend Threshold shall be appropriately
         adjusted from time to time for any stock dividends on or subdivisions
         or combinations of or other similar events with respect to WPP Ordinary
         Shares. WPP shall provide notice to the Trustee of the total amount of
         pence sterling per WPP Ordinary Share actually paid by WPP as a cash
         dividend per WPP Ordinary Share with respect to calendar year 2004
         promptly after payment of WPP's final dividend with respect to calendar
         2004. For purposes hereof, the phrase "dividends paid with respect to"
         a calendar year shall mean dividends specifically paid out of the
         earnings of such calendar year.

                  (f)      In case a tender or exchange offer (a "TENDER OFFER")
         made by WPP or any subsidiary of WPP for all or any portion of the WPP
         Ordinary Shares shall expire and such Tender Offer (as amended as of
         the expiration thereof) shall require the payment to
<PAGE>
         holders of WPP Ordinary Shares of consideration per WPP Ordinary Share
         having a cash and fair market value and any other consideration
         included in such payment per WPP Ordinary Share (as determined by the
         WPP Board of Directors, whose determination shall be conclusive and
         described in a resolution of the WPP Board of Directors) that as of the
         last time (the "EXPIRATION TIME") tenders or exchanges may be made
         pursuant to such Tender Offer (as it may be amended) exceeds the first
         reported sale price per WPP Ordinary Share on the Trading Day next
         succeeding the Expiration Time, the Conversion Price shall be decreased
         so that the same shall equal the price determined by multiplying the
         Conversion Price in effect immediately prior to the Expiration Time by
         a fraction,

                  (i) the numerator of which shall be the number of WPP Ordinary
         Shares outstanding (including any tendered or exchanged shares) at the
         Expiration Time multiplied by the Last Reported Sale Price of a WPP
         Ordinary Share on the Trading Day next succeeding the Expiration Time,
         and

                  (ii) the denominator of which shall be the sum of (x) the fair
         market value (determined as aforesaid) of the aggregate consideration
         payable to holders of WPP Ordinary Shares based on the acceptance (up
         to any maximum specified in the terms of the tender or exchange offer)
         of all shares validly tendered or exchanged and not withdrawn as of the
         Expiration Time (the shares deemed so accepted up to any such maximum,
         being referred to as the "PURCHASED SHARES") and (y) the product of the
         number of WPP Ordinary Shares outstanding (less any Purchased Shares)
         at the Expiration Time and the Last Reported Sale Price of a WPP
         Ordinary Share on the Trading Day next succeeding the Expiration Time,

such adjustment to become effective immediately prior to the opening of business
on the day following the Expiration Time. If WPP is obligated to purchase shares
pursuant to any such Tender Offer, but WPP is permanently prevented by
applicable law from effecting any such purchases or all such purchases are
rescinded, the Conversion Price shall again be adjusted to be the Conversion
Price that would then be in effect if such Tender Offer had not been made.

         If an adjustment is required to be made as set forth in Section
11A.06(f) above, such adjustment shall be calculated based upon the amount by
which the aggregate consideration paid for WPP Ordinary Shares acquired in the
Tender Offer exceeds the value of such shares based on the first reported sale
price of WPP Ordinary Shares on the Trading Day next succeeding the Expiration
Time.

11A.07 No Adjustment.

         No adjustment in the Conversion Price shall be required under Section
11A.06 unless the adjustment would require an increase or decrease of at least
1% in the Conversion Price then in effect; provided, however, that any
adjustment which by reason of this Section 11A.07 is not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
<PAGE>
         With respect to Sections 11A.06(d) and (e) hereof, no adjustment to the
Conversion Price shall be made if WPP provides that Holders of Debentures will
participate in the Asset Distribution or the Cash Dividend, as applicable, on an
as-converted basis without conversion. Furthermore, if the numerator of the
fraction described in Sections 11A.06(d) and (e) hereof is less than 1 United
Kingdom pence (including a negative amount) then in lieu of any adjustment of
the Conversion Price, WPP shall make adequate provision so that each Holder of
Debentures shall have the right to receive upon conversion, in addition to the
cash and WPP ADSs issuable upon such conversion, the distribution or dividend
such Holder would have received had such Holder converted such Debentures
immediately prior to the record date for such distribution or dividend. In the
case where this Indenture provides that a Conversion Price adjustment is
effective upon the record date for a distribution or dividend, if the
distribution or dividend is not so paid or made, the Conversion Price shall
again be adjusted to be the Conversion Price that would then be in effect if
such distribution or dividend had not been declared.

11A.08 Equivalent Adjustments.

         If, as a result of an adjustment made pursuant to Section 11A.06 above,
the holder of any Debenture thereafter surrendered for conversion shall become
entitled to receive any shares of capital stock of WPP other than WPP ADSs
representing WPP Ordinary Shares, thereafter the Conversion Price of such other
shares so receivable upon conversion of any Debentures shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to WPP Ordinary Shares contained in
this Article 11A.

11A.09 Notice of Adjustment.

         Whenever the Conversion Price is adjusted pursuant to Section 11A.06,
or Holders become entitled to other securities or due bills, WPP shall promptly
mail to Holders a notice of the adjustment and file with the Trustee an
Officers' Certificate briefly stating the facts requiring the adjustment and the
manner of computing it. The certificate shall be conclusive evidence of the
correctness of such adjustment and the Trustee may conclusively assume that,
unless and until such certificate is received by it, no such adjustment is
required.

11A.10 Notice of Certain Transactions

         After the Effective Time, WPP shall give notice to the Holders of
record of the Debentures of the pending occurrence of each Below Market
Issuance, Cash Dividend and Asset Distribution not less than twenty Business
Days prior to the ex-dividend date for such distribution and notice to the
Holders of record of the Debentures of the occurrence of each Change of Control
within twenty Business Days after WPP obtains knowledge of such occurrence of a
Change of Control.

         WPP shall cause any such notice to be filed with the Trustee and the
Conversion Agent and to be mailed to each Holder of Debentures at its address
appearing on the list provided for in Section 2.05, as promptly as possible but
in any event at least ten days prior to the applicable date hereinafter
specified, a notice stating (x) the date on which a record of the holders of WPP
ADSs is to be taken for the purpose of such transaction, or, if a record is not
to be taken, the date as of
<PAGE>
which the holders of WPP ADSs are to be determined, or (y) the date on which
such transaction is expected to become effective or occur, and the date as of
which it is expected that holders of WPP ADSs of record shall be entitled to
exchange their WPP ADSs for securities or other property deliverable upon such
transaction. Notwithstanding anything in this paragraph to the contrary, neither
WPP nor the Company shall not be obligated under this Indenture to provide
notice to Holders of a Change of Control, other than as set forth in the
preceding paragraph.

11A.11 Effect of Reclassification, Consolidation, Merger, Share Exchange or Sale
on Conversion Privilege.

         If any of the following shall occur after the Effective Time, namely
(i) any reclassification or change of outstanding WPP Ordinary Shares (other
than a change in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination); (ii) any
consolidation, combination, merger, scheme of arrangement or share exchange to
which WPP is a party other than a merger or scheme of arrangement in which WPP
is the continuing corporation and that does not result in any reclassification
of, or change (other than a change in name, or par value, or from par value to
no par value, or from no par value to par value, or as a result of a subdivision
or combination) in, outstanding WPP Ordinary Shares; or (iii) any sale or
conveyance of all or substantially all of the assets of WPP, then WPP, or such
successor or purchasing corporation, as the case may be, and the Company shall,
as a condition precedent to such reclassification, change, consolidation,
combination, merger, scheme of arrangement, share exchange, sale or conveyance,
execute and deliver to the Trustee a supplemental indenture providing that the
Holder of each Debenture then outstanding shall have the right to convert such
Debenture into (a) the Cash Conversion Amount and (b) the kind and amount of
shares of capital stock and other securities and property (including cash)
("ACQUIROR SECURITIES") receivable upon such reclassification, change,
consolidation, combination, merger, scheme of arrangement, share exchange, sale
or conveyance by a holder of the number of WPP Ordinary Shares deliverable upon
conversion of such Debenture immediately prior to the record date or effective
date, as applicable, of such reclassification, change, consolidation,
combination, merger, scheme of arrangement, share exchange, sale or conveyance.
Such supplemental indenture shall provide for adjustments of the Conversion
Price that shall be as nearly equivalent as may be practicable to the
adjustments of the Conversion Price provided for in this Article 11A. If, in the
case of any such consolidation, combination, merger, scheme of arrangement,
share exchange, sale or conveyance, the stock or other securities and property
(including cash) receivable thereupon by a holder of WPP Ordinary Shares
includes shares of capital stock or other securities and property of a
corporation other than the successor or purchasing corporation, as the case may
be, in such consolidation, combination, merger, scheme of arrangement, share
exchange, sale or conveyance, then such supplemental indenture shall also be
executed by such other corporation and shall contain such additional provisions
to protect the interests of the Holders of the Debentures as the Board of
Directors of the Company and the Board of Directors of WPP shall reasonably
consider necessary by reason of the foregoing. The provision of this Section
11A.11 shall similarly apply to successive consolidations, combinations,
mergers, schemes of arrangement, share exchanges, sales or conveyances.
Notwithstanding the foregoing, a distribution by WPP to all or substantially all
holders of its WPP Ordinary Shares for which an adjustment to the Conversion
Price or provision for conversion of the Debentures may be made pursuant to
Section 11A.06 shall not be deemed
<PAGE>
to be a sale or conveyance of all or substantially all of the assets of WPP for
purposes of this Section 11A.11.

         In the event WPP shall execute a supplemental indenture pursuant to
this Section 11A.11, WPP shall promptly file with the Trustee an Opinion of
Counsel stating that such supplemental indenture is authorized or permitted by
this Indenture and an Officers' Certificate briefly stating the reasons
therefor, the kind or amount of shares of stock or securities or property
(including cash) receivable by Holders of the Debentures upon the conversion of
their Debentures after any such reclassification, change, consolidation,
combination, merger, scheme of arrangement, share exchange, sale or conveyance,
any adjustment to be made with respect thereto and that all conditions precedent
have been complied with.

11A.12 Trustee's Disclaimer.

         The Trustee has no duty to determine when an adjustment under this
Article 11A should be made, how it should be made or what such adjustment should
be made, but may accept as conclusive evidence of the correctness of any such
adjustment, and shall be protected in relying upon, the Officers' Certificate
with respect thereto which WPP is obligated to file with the Trustee pursuant to
Section 11A.09. The Trustee shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Debentures, and the Trustee shall not be responsible for
WPP's failure to comply with any provisions of this Article 11A. Each Conversion
Agent (other than WPP or an Affiliate of WPP) shall have the same protection
under this Section 11A.12 as the Trustee.

         The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 11A.11, but may accept as conclusive evidence of the
correctness thereof, and shall be protected in relying upon, the Officers'
Certificate with respect thereto which WPP is obligated to file with the Trustee
pursuant to Section 11A.11.

11A.13 Voluntary Reduction.

         WPP may, from time to time after the Effective Time, to the extent
permitted by law and The Nasdaq Stock Market Marketplace Rules, reduce the
Conversion Price by any amount for any period of at least 20 Business Days, in
which case WPP shall give at least fifteen (15) days' notice of such reduction.
In particular, WPP may, at its option after the Effective Time, make such
reduction in the Conversion Price, in addition to those set forth in Section
11A.06, as it deems advisable to avoid or diminish any income tax to holders of
WPP Ordinary Shares resulting from any dividend or distribution of stock (or
rights to acquire stock) or from any event treated as such for tax purposes or
for any other reasons.

11A.14 Simultaneous Adjustments.

         In the event that this Article 11A requires adjustments to the
Conversion Price under more than one of the subsections of Section 11A.06, and
the record dates for the distributions giving rise to such adjustments shall
occur on the same date, or if more than one event requiring
<PAGE>
adjustment pursuant to Section 11A.06 shall occur before completing the
determination for the Conversion Price for the first event requiring such
adjustment, then in each case, such adjustments shall be made in such order as
determined by the WPP Board of Directors (whose determination shall, if made in
good faith, be conclusive) as shall preserve for Holders the Conversion Price
protection provided in Section 11A.06.

11A.15 Effectiveness; Cross References.

         Following the Effective Time, all references to Article 11 or any
Section thereof shall be deemed to be references to this Article 11A and the
respective Sections hereof."

         Section 3.03 Amendment to Paragraph 8 of the Debenture. Paragraph 8 of
the Debenture is hereby amended to read in its entirety as follows:

         "8. Conversion. Subject to the provisions of Article 11 of the
Indenture, a Holder of a Debenture may convert such Debenture prior to the
Effective Time into shares of Common Stock of the Company if any of the
conditions specified in paragraphs(a) through (e) of Section 11.01 of the
Indenture is satisfied, and subject to the provisions of Article 11A of the
Indenture, a Holder of a Debenture may convert such Debenture from and after the
Effective Time into the Cash Conversion Amount in cash and WPP ADSs representing
a number of WPP Ordinary Shares equal to the Stock Conversion Amount divided by
the Conversion Price; provided, however, that if such Debenture is called for
redemption, the conversion right will terminate on the second Business Day
immediately preceding the Redemption Date of such Debenture (unless the Company
shall default in making the redemption payment when due, in which case the
conversion right shall terminate at the close of business on the date such
Default is cured and such Debenture is redeemed). The initial conversion price
prior to the Effective Time is $961.20 per share of Common Stock, and the
initial conversion price from and after the Effective Time is $8.84 per WPP
Ordinary Share, subject to adjustment under certain circumstances as described
in the Indenture (the "CONVERSION PRICE"). The number of shares of Common Stock
issuable upon conversion of a Debenture prior to the Effective Time is
determined by dividing the principal amount of Debentures converted by the
Conversion Price in effect on the conversion date. The number of WPP Ordinary
Shares represented by WPP ADSs issuable upon conversion of a Debenture from and
after the Effective Time is determined by dividing (a) the Stock Conversion
Amount by (b) the Conversion Price in effect on the conversion date. In the
event of a conversion of a Debenture prior to the Effective Time, the Company
has the option, in lieu of delivering shares of Common Stock, to pay the Holder
surrendering such Debenture an amount of cash determined in accordance with
Section 11.02 of the Indenture. Upon conversion, no adjustment for interest
(including Contingent Interest and Additional Amounts, if any), or dividends
will be made. No fractional shares will be issued upon conversion; in lieu
thereof, an amount will be paid in cash based upon (i) if conversion occurs
prior to the Effective Time, the current Market Price (as defined in the
Indenture) of the Common Stock on the last trading day prior to the date of
conversion and (ii) if conversion occurs from and after the Effective Time, the
current WPP Market Price (as defined in the Indenture) of WPP ADSs on the last
trading day prior to the date of conversion.
<PAGE>
         To convert a Debenture, a Holder must (a) complete and sign the
irrevocable conversion notice set forth below (copies of which may also be
obtained from the Conversion Agent) and deliver such notice to the Conversion
Agent, (b) surrender the Debentures by delivering them to the Conversion Agent,
at the office or agency maintained for such purpose in the Borough of Manhattan,
The City of New York, (c) furnish appropriate endorsements and transfer
documents if required by the Registrar or the Conversion Agent, (d) pay any
transfer or similar tax, if required and (e) if the Debenture is held in
book-entry form, complete and deliver to the Depositary appropriate instructions
pursuant to the Depositary's book-entry conversion programs. Upon satisfaction
of such requirements, the Conversion Agent shall, on behalf of such Holder,
immediately convert such Debentures into, prior to the Effective Time, Common
Stock (unless the Company has elected to pay cash in lieu of delivering shares
of Common Stock) and, from and after the Effective Time, the Cash Conversion
Amount and WPP ADSs representing the number of WPP Ordinary Shares described
above. If a Holder surrenders a Debenture for conversion between the record date
for the payment of an installment of interest and the related Interest Payment
Date, the Debenture must be accompanied by payment of an amount equal to the
interest (including Contingent Interest and Additional Amounts, if any), payable
on such Interest Payment Date on the principal amount of the Debenture or
portion thereof then converted; provided, however, that no such payment shall be
required if such Debenture has been called for redemption on a Redemption Date
within the period between and including such record date and such Interest
Payment Date, or if such Debenture is surrendered for conversion on the Interest
Payment Date. A Holder may convert a portion of a Debenture equal to $1,000 or
any integral multiple thereof.

         A Debenture in respect of which a Holder has delivered a Holder Change
of Control Acceptance Notice exercising the option of such Holder to require the
Company to repurchase such Debenture as provided in Section 3.11 or a Purchase
Acceptance Notice exercising the option of such Holder to require the Company to
repurchase such Debenture as provided in Section 3.16 of the Indenture may be
converted only if such notice of exercise is withdrawn in accordance with the
terms of the Indenture."
<PAGE>
                                    ARTICLE 4

                                  MISCELLANEOUS

         Section 4.01 Binding Agreement; Assignments. Whenever in this Second
Supplemental Indenture any of the parties hereto is referred to, such reference
shall be deemed to include the successors and assigns of such party.

         Section 4.02 Effectiveness; Relation to Indenture. The provisions of
this Second Supplemental Indenture shall become effective as of the date hereof.
This Second Supplemental Indenture and all the terms and provisions herein
contained shall form a part of the Indenture as fully and with the same effect
as if all such terms and provisions had been originally set forth in the
Indenture. The Indenture is hereby ratified and confirmed and shall remain and
continue in full force and effect in accordance with its terms and provisions,
as supplemented and amended by this Second Supplemental Indenture. The Indenture
and this Second Supplemental Indenture shall be read, taken and construed
together as one instrument.

         Section 4.03 Counterparts. This Second Supplemental Indenture may be
executed in several counterparts, each of which shall be deemed an original, but
all of which together shall constitute one instrument.

         Section 4.04 Governing Law. This Second Supplemental Indenture shall be
governed by and construed in advance with the law of the State of New York.

         Section 4.05 Trustee. The recitals contained herein shall be taken as
the statements of Abbey, WPP and Grey, and the Trustee assumes no responsibility
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Second Supplemental Indenture.
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed as of the day and year first above
written.

                                        GREY GLOBAL GROUP INC.

                                        By:_____________________________________
                                           Name:
                                           Title:

                                        ABBEY MERGER CORPORATION

                                        By:_____________________________________
                                           Name:
                                           Title:

                                        WPP GROUP PLC

                                        By:_____________________________________
                                           Name:
                                           Title:

                                        AMERICAN STOCK TRANSFER & TRUST COMPANY,
                                        as Trustee

                                        By:_____________________________________
                                           Name:
                                           Title:
<PAGE>
                                                                         Annex B
<TABLE>
<CAPTION>
                                                                     AGGREGATE PRINCIPAL
CONSENTING HOLDER'S NAME AND                                         AMOUNT OF DEBENTURES
           ADDRESS             NAME OF NOMINEES HOLDING DEBENTURES
----------------------------   -----------------------------------   --------------------
<S>                            <C>                                   <C>

</TABLE>
<PAGE>
                                                                         Annex C

                                  Press Release<PAGE>
EXHIBIT 10.2

                             ALASKA AIR GROUP, INC.
                          2004 LONG-TERM INCENTIVE PLAN

               ADOPTED BY THE BOARD OF DIRECTORS ON MARCH 31, 2004
            APPROVED BY ALASKA AIR GROUP SHAREHOLDERS ON MAY 18, 2004
                AMENDED BY THE BOARD OF DIRECTORS ON JUNE 2, 2004

1. PURPOSE

      The purpose of the Alaska Air Group, Inc. 2004 Long-Term Incentive Equity
Plan (the "Plan") is to promote the long-term profitability of Alaska Air Group,
Inc. ("Air Group" and together with its subsidiaries, the "Company") and to
enhance value for its stockholders by offering incentives and rewards to key
employees, officers and directors of the Company, to retain their services and
to encourage them to acquire and maintain stock ownership in the Company.

2. TERM

      The Plan shall become effective as of May 18, 2004, subject to the
approval of the stockholders of Air Group, and shall terminate at the close of
business on the tenth anniversary of such approval date unless terminated
earlier by the Board. After termination of the Plan, no future awards may be
granted, but previously granted awards shall remain outstanding in accordance
with their applicable terms and conditions and the terms and conditions of the
Plan.

3. PLAN ADMINISTRATION

      The Compensation Committee (the "Committee") of the Board of Directors of
the Air Group (the "Board") shall be responsible for administering the Plan. The
members of the Committee shall be appointed by the Board and shall consist
solely of three or more nonemployee members of the Board who are "independent"
directors as defined in the New York Stock Exchange's Listed Company Manual and
who are intended to qualify to administer the Plan as contemplated by (a) Rule
16b-3 under the Securities and Exchange Act of 1934 (the "Exchange Act") or any
successor rules, and (b) Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Code"). The Committee shall have full and exclusive power to
interpret the Plan and to adopt such rules, regulations and guidelines for
carrying out the Plan as it may deem necessary or proper, all of which power
shall be executed in the best interests of the Company and in keeping with the
objectives of the Plan. This power includes but is not limited to selecting
award recipients, establishing all award terms and conditions and adopting
modifications, amendments and procedures, as well as rules and regulations
governing awards under the Plan, and to make all other determinations necessary
or advisable for the administration of the Plan. In no event, however, shall the
Committee have the power to cancel outstanding stock options or stock
appreciation rights ("SARs") for the purpose of replacing or re-granting such
options or SARs with a purchase price that is less than the purchase price of
the original option or SAR. The interpretation and construction of any provision
of the Plan or any option or right granted hereunder and all determinations by
the Committee in each case shall be final, binding and conclusive with respect
to all interested parties.

4. ELIGIBILITY

      Any employee or director of the Company shall be eligible to receive
awards under the Plan. "Employee" shall also include any former employee or
director of the Company eligible to receive an assumed or replacement award as
contemplated in Sections 6 and 8 and any person to whom an offer of employment
has been extended. "Company" includes any entity that is directly or indirectly
controlled by the Company, as determined by the Committee; provided however,
that ISOs (as defined in Section 8(a)) may only be granted to an employee of Air

<PAGE>

Group or one of its "subsidiary corporations" (as that term is defined in
Section 424(f) of the Code). A director who is not an employee of the Company (a
"nonemployee director") is eligible to receive payments as set forth in Section
8(d) for payment of such nonemployee director's annual retainer (exclusive of
any per-meeting fees, committee chair fees or expense reimbursements) ("Annual
Retainer").

5. SHARES OF COMMON STOCK SUBJECT TO THE PLAN

      Subject to the provisions of Section 6 of the Plan, the aggregate number
of shares of common stock, $1.00 par value, ("Common Stock") of Air Group
("shares") which may be awarded and delivered to participants under the Plan
shall not exceed the sum of (i) 1,700,000, (ii) any shares available for future
awards, as of the effective date of this Plan, under the Alaska Air Group, Inc.
1999 Long-Term Incentive Equity Plan (the "1999 Equity Plan") and (iii) any
shares that are represented by awards under the 1999 Equity Plan which, after
the effective date of this Plan, are forfeited, expired, are cancelled without
delivery of shares, or otherwise result in the return of shares to the Company.

      Notwithstanding any provision to the contrary, the following award limits
shall apply (subject to adjustment as provided in Section 6 below):

      (a)   In no event shall a participant receive an award or awards during
            any one (1) calendar year covering in the aggregate more than
            300,000 shares;

      (b)   In no event shall there be granted during the term of the Plan
            shares pursuant to Section 8(c) of the Plan covering more than fifty
            percent (50%) of the total shares authorized under this Plan.

      Shares subject to awards under the Plan which expire, terminate or are
canceled prior to exercise or, in the case of awards granted under Section 8(c),
do not vest shall thereafter be available for the granting of other awards.
Shares otherwise issuable pursuant to an award that have been exchanged by a
participant as full or partial payment to the Company in connection with any
award under the Plan also shall thereafter be available for the granting of
other awards. In instances where an SAR or other award is settled in cash, the
shares covered by such award shall remain available for the granting of other
awards. Likewise, the payment of cash dividends and dividend equivalents paid in
cash in conjunction with outstanding awards shall not be counted against the
shares available for issuance.

      Any shares issued under the Plan may consist in whole or in part of
authorized and unissued shares or of treasury shares, and no fractional shares
shall be issued under the Plan. Cash may be paid in lieu of any fractional
shares in settlements of awards under the Plan.

6. ADJUSTMENTS AND REORGANIZATIONS

      In the event of any stock dividend, stock split, combination or exchange
of shares, merger, consolidation, spin-off, recapitalization or other
distribution (other than normal cash dividends) of Company assets to
stockholders, or any other change affecting shares or share price, the Committee
shall make a proportionate adjustment, as the Committee in its sole discretion
deems equitable or appropriate, with respect to: (a) the aggregate number of
shares that may be issued under the Plan; (b) each outstanding award made under
the Plan; and (c) the exercise price per share for any outstanding stock
options, SARs or similar awards under the Plan.

7. FAIR MARKET VALUE

      Fair Market Value for all purposes under the Plan shall mean the closing
price of a share of Common Stock as reported daily on the New York Stock
Exchange (or, if the shares are not listed on the New York Stock Exchange, such
other established national securities exchange or association that the Committee
shall designate). If no sales of shares were made on such date, the closing
price of a share as reported for the preceding day on which a sale of shares
occurred shall be used.

<PAGE>

8. AWARDS

      The Committee shall determine the type or types of award(s) to be made to
each participant. Awards may be granted singly, in combination or in tandem.
Awards also may be made in combination or in tandem with, in replacement of, as
conversion or substitution for, as alternative to, or as the payment form for,
grants or rights under any other compensation plan or individual contract or
agreement of the Company including those of any acquired entity. The Committee
shall have the right to substitute or assume awards under this Plan in
connection with mergers, reorganizations, separations, or other transaction to
which Section 424(a) of the Code applies, provided such substitutions and
assumptions are permitted by Section 424 of the Code and the regulations
promulgated thereunder. The types of awards that may be granted under the Plan
are:

            (a) Stock Options -- This is a grant of a right to purchase a
      specified number of shares during a specified period as determined by the
      Committee. Each stock option shall be in such form and shall contain such
      terms and conditions as the Committee shall deem appropriate. Stock
      options granted under the Plan may either be incentive stock options
      ("ISOs") which are qualified under Section 422 of the Code, with respect
      to grants to participating employees, or nonqualifed stock options
      ("Nonqualified Options"), with respect to grants to participating
      employees or other eligible Plan participants. All stock options shall be
      separately designated ISOs or Nonqualified Options at the time of grant.
      Stock options converted or substituted under the Plan for any or all
      outstanding stock options and stock appreciation rights held by employees,
      consultants, advisors or other option holders of an acquired entity are
      referred to in this Plan as "Conversion Options." The purchase price per
      share for each stock option shall be not less than 100% of Fair Market
      Value on the date of grant (except (1) for Conversion Options and (2) if a
      stock option is granted retroactively in tandem with or as a substitution
      for an SAR, the exercise price may be no lower than the exercise price per
      share for such tandem or replaced SAR). The exercise price for a stock
      option shall be paid in full by the optionee at the time of the exercise
      in cash or such other method permitted by the Committee, including (i)
      tendering (either actually or by attestation) shares, (ii) authorizing a
      third party to sell the shares (or a sufficient portion thereof) acquired
      upon exercise of a stock option and assigning the delivery to the Company
      of a sufficient amount of the sale proceeds to pay for all the shares
      acquired through such exercise, or (iii) any combination of the above.

                  (I) Incentive Stock Options. Notwithstanding anything to the
            contrary herein, each ISO granted pursuant to this Plan shall
            include the following provisions: ISOs may be granted only to
            individuals who are employees of the Company at the time the ISO is
            granted. The purchase price per share for each ISO (except for
            Conversion Options) shall not be less than 100% of Fair Market Value
            on the date of grant. No employee shall be eligible for an ISO if,
            on the date of grant, such employee owns (including ownership
            through the attribution provisions of Section 422 of the Code) in
            excess of 10% of the total combined voting power of all classes of
            stock of the Company unless the following two conditions are met:
            (A) the option price for the shares of Common Stock subject to the
            ISO is at least 110% of the Fair Market Value on the date of grant
            and (B) the option agreement under which the stock option was
            granted provides that the term of the ISO does not exceed five
            years. No employee shall be eligible to receive ISOs (under this
            Plan and all other stock option plans of the Company) that are
            exercisable for the first time in any calendar year with respect to
            shares with a Fair Market Value (determined at the date of grant) in
            excess of $100,000. No ISO shall be exercisable after the expiration
            of ten (10) years from the date it was granted. An ISO shall not be
            transferable except by will or by the laws of descent and
            distribution and, during the lifetime of the option holder, shall be
            exercisable only by the option holder.

            (b) SARs -- This is a right to receive a payment, in cash and/or
      shares, equal to the excess of the Fair Market Value of a specified number
      of shares on the date the SAR is exercised over the Fair Market Value on
      the date the SAR was granted (except that if an SAR is granted
      retroactively in tandem with or in substitution for a stock option, the
      designated Fair Market Value shall be no lower than the exercise price per
      share for such tandem or replaced stock option).

<PAGE>

            (c) Stock Awards -- This is an award made or denominated in shares
      or units equivalent in value to shares. All or part of any stock award may
      be subject to conditions and restrictions established by the Committee
      which may be based on continuous service with the Company or the
      achievement of performance goals related to profits, profit growth,
      profit-related return ratios, cash flow or stockholder returns, or other
      performance goals as the Committee deems appropriate, where such goals may
      be stated in absolute terms or relative to comparison companies. Stock
      awards based on continuous service will vest over a period of three years
      or more. Stock awards based on performance measures will vest over a
      period of one year or more, as the Committee may determine.

            (d) Stock Payments - This is payment of a portion or all of the
      Annual Retainer to be paid to a nonemployee director in shares of Common
      Stock (a "Stock Payment") rather than cash for services rendered as a
      director of the Company. On the first business day following the Company's
      Annual Meeting of Stockholders, or such later date during the period
      beginning on the date immediately following the Company's Annual Meeting
      of Stockholders for that year and ending immediately prior to the
      Company's Annual Meeting of Stockholders in the next succeeding calendar
      year (the "Plan Year") that a nonemployee director is elected or appointed
      to the Board, a Stock Payment will be made to each nonemployee director
      for a fixed portion of such nonemployee director's Annual Retainer. The
      fixed portion shall be determined by the Board. A nonemployee director may
      also make an election to increase the amount of the Stock Payment up to
      the full amount of such nonemployee director's Annual Retainer. Such an
      election shall be made on a form provided by the Committee and returned to
      the Committee on such date as the Committee shall establish, but in any
      case no later than the first day of the Plan Year to which the election
      relates. The election form shall state the amount by which the nonemployee
      director desires to reduce the cash portion of his or her Annual Retainer,
      which shall be applied toward the purchase of Common Stock on the same
      date that the Stock Payment is made; provided, however, that no fractional
      shares may be purchased. Any funds withheld but not able to be applied to
      the purchase of whole shares shall be paid to the nonemployee director in
      cash. A nonemployee director shall not be allowed to change or revoke any
      election for the relevant year, but may change his or her election for any
      subsequent Plan Year.

            (e) Cash Award - This is an award paid in cash upon the achievement,
      in whole or part, of performance goals relating to one or more of the
      following business criteria within the meaning of Section 162(m) of the
      Code: profitability, revenue, cost, cash flow, earnings, share price,
      return on equity, return on assets, return on invested capital, economic
      value added, market share, productivity, safety, customer satisfaction,
      on-time performance or other objective operational measures. Any of these
      criteria may be used to measure the performance of the Company as a whole
      or any business unit or division of the Company. These criteria shall be
      calculated under a methodology established in writing by the Committee
      prior to the issuance of an award. Such writing may be a plan or other
      arrangement established by the Committee hereunder, which shall set forth
      the terms and conditions of the performance-based cash awards, provided
      that such plan or arrangement shall not expand the class of individuals
      entitled to participate under the 2004 Long-Term Incentive Plan, add to
      any of the performance criteria described above, or increase the maximum
      amount payable to any single participant with respect to any calendar
      year, as set forth below. The maximum amount of any cash payment under a
      plan or arrangement established by the Committee hereunder to any single
      participant with respect to any calendar year will not exceed twice the
      participant's base salary as in effect on the last day of the preceding
      fiscal year and in no event will exceed $1,000,000.

9. DIVIDENDS AND DIVIDEND EQUIVALENTS

      The Committee may provide that any awards under the Plan earn dividends or
dividend equivalents. Such dividends or dividend equivalents may be paid
currently or may be credited to a participant's account. Any crediting of
dividends or dividend equivalents may be subject to such restrictions and
conditions as the Committee may establish, including reinvestment in additional
shares or share equivalents.

<PAGE>

10. DEFERRALS AND SETTLEMENTS

      Payment of awards may be in the form of cash, stock, other awards or
combinations thereof as the Committee shall determine, and with such
restrictions as it may impose. The Committee also may require or permit
participants to elect to defer the issuance of shares or the settlement of
awards in cash under such rules and procedures as it may establish under the
Plan. It also may provide that deferred settlements include the payment or
crediting of interest on the deferral amounts, or the payment or crediting of
dividend equivalents where the deferral amounts are denominated in shares.

11. TRANSFERABILITY AND EXERCISABILITY

      Awards granted under the Plan shall not be transferable or assignable
other than by will or the laws of descent and distribution, except to the extent
permitted by the Committee, in its sole discretion. However, any award so
transferred shall continue to be subject to all the terms and conditions
contained in the instrument evidencing such award.

12. EVIDENCE OF AWARDS

      Awards under the Plan shall be evidenced by instruments as approved by the
Committee that set forth the terms, conditions and limitations for each award
which may include the term of an award, the provisions applicable in the event
the participant's employment terminates, and the Committee's authority to
unilaterally or bilaterally amend, modify, suspend, cancel or rescind any award.

13. ACCELERATION AND SETTLEMENT OF AWARDS

      In the event of a proposed sale, merger, consolidation, reorganization,
liquidation, or upon a change in control of the Company as defined by the Board
of Directors, the Committee shall have the discretion to provide for the
acceleration of vesting and for settlement, including cash payment or assumption
and/or conversion, of an award granted under the Plan. Such provision for the
acceleration of vesting and for settlement, including cash payment or assumption
and/or conversion may be set forth in an award agreement made pursuant to this
Plan. However, the granting of awards under the Plan shall in no way affect the
right of the Company to adjust, reclassify, reorganize, or otherwise change its
capital or business structure, or to merge, consolidate, dissolve, liquidate,
sell or transfer all or any portion of its businesses or assets In addition, the
Committee shall have the discretion to provide for the acceleration of vesting
of awards made pursuant to this Plan in the event of a participant's death or
total disability, or a participant's termination or retirement from the Company,
each as defined by the Committee.

14. PLAN AMENDMENT

      The Plan may be amended only by the Board as it deems necessary or
appropriate to better achieve the purposes of the Plan; provided, however, that
to the extent required by the IRS Code or the rules of the SEC or NYSE,
stockholder approval shall be required for any amendment of the Plan. In
addition, stockholder approval shall be required for any material amendment to
the Plan.

15. TAX WITHHOLDING

      The Company shall have the right to deduct from any settlement of an award
made under the Plan, including the delivery or vesting of shares, a sufficient
amount to cover withholding of any federal, state or local taxes required by
law, or to take such other action as may be necessary to satisfy any such
withholding obligations, including requiring Plan participants to tender a cash
payment in satisfaction of the withholding obligation. The Committee may, in its
discretion and subject to such rules as it may adopt, permit participants to use
shares to satisfy required tax withholding, and such shares shall be valued at
the Fair Market Value as of the settlement date of the applicable award.

<PAGE>

16. OTHER BENEFIT AND COMPENSATION PROGRAMS

      Unless otherwise specifically determined by the Committee and not
inconsistent with the terms of any benefit plan, severance program or severance
pay law, settlements of awards received by participants under the Plan shall not
be deemed a part of a participant's regular, recurring compensation for purposes
of calculating payments or benefits from any Company benefit plan, severance
program or severance pay law. Further, the Company may adopt other compensation
programs, plans or arrangements as it deems appropriate or necessary.

17. UNFUNDED PLAN

      Unless otherwise determined by the Board, the Plan shall be unfunded and
shall not create (or be construed to create) a trust or a separate fund or
funds. The Plan shall not establish any fiduciary relationship between the
Company and any participant or other person. To the extent any person holds any
rights by virtue of an award granted under the Plan, such rights (unless
otherwise determined by the Committee) shall be no greater than the rights of an
unsecured general creditor of the Company.

18. USE OF PROCEEDS

      The cash proceeds received by the Company from the issuance of shares
pursuant to awards under the Plan shall constitute general funds of the Company.

19. REGULATORY APPROVALS

      The implementation of the Plan, the granting of any award under the Plan,
and the issuance of shares upon the exercise or settlement of any award shall be
subject to the Company's procurement of all approvals and permits required by
regulatory authorities having jurisdiction over the Plan, the awards granted
under it or the shares issued pursuant to it.

20. FUTURE RIGHTS

      No person shall have any claim or rights to be granted an award under the
Plan, and no participant shall have any rights under the Plan to be retained in
the employ of the Company. A person granted an award under the Plan shall have
no rights as a stockholder with respect to shares covered by such person's award
until the date of the issuance of shares to the person pursuant to the terms of
such award.

21. SUCCESSORS AND ASSIGNS

      The Plan shall be binding on all successors and assigns of a participant
including, without limitation, the estate of such participant and the executor,
administrator or trustee of such estate, or any receiver or trustee in
bankruptcy or representative of the participant's creditors.

<PAGE>

                             ALASKA AIR GROUP, INC.

                      2004 LONG-TERM INCENTIVE EQUITY PLAN

                             STOCK OPTION AGREEMENT

      Option Agreement, effective _______, between Alaska Air Group, Inc. ("Air
Group"), a Delaware corporation, and ____________ ("Optionee"), an employee of a
wholly owned subsidiary of Air Group (the "Company").

      WHEREAS, Section 3 of the 2004 Long-Term Incentive Equity Plan ("the
Plan") authorizes the Compensation Committee of the Air Group Board of Directors
(the "Committee") to designate the individuals who are to receive stock options
and the terms and conditions pertaining to such options;

      NOW, THEREFORE, PURSUANT TO SUCH AUTHORITY, IT IS AGREED AS FOLLOWS:

      1.    Air Group hereby grants to Optionee a nonqualified stock option to
            purchase _____ shares of the Common Stock of Air Group, subject to
            the provisions of the 2004 Long-Term Incentive Equity Plan and this
            Option Agreement. The date of the grant of the option is ______. The
            exercise price is ____ per share, which is the closing price of the
            Common Stock on the date of grant. The option will expire on
            _______________, and shall not be exercisable after that date.

      2.    By this reference, this Agreement embodies and adopts the terms of
            the 2004 Long-Term Incentive Equity Plan.

      3.    Optionee acknowledges and agrees that:

            (a)   The options shall vest over four (4) years from the date of
                  grant and become exercisable in four (4) equal annual
                  installments.

            (b)   The option is not transferable; however, Optionee may
                  designate a beneficiary on forms prescribed by and filed with
                  Air Group.

            (c)   If the employment of Optionee with the Company (as defined in
                  the Plan, including Air Group and subsidiaries) ceases due to
                  retirement or early retirement with the Committee's approval,
                  then the option will continue to vest and remain exercisable
                  until the earlier of the option expiration date or three (3)
                  years after employment ceases. For purposes of this agreement,
                  an employee is considered to have retired if, on the date of
                  termination any of the following applies: (i) he or she is at
                  least 55 years of age and has five years of service with the
                  Company or its subsidiaries, (ii) is at least 60 years of age,
                  or (iii) is a participant in and is entitled to commence a
                  benefit under a Company-sponsored defined benefit plan. In the
                  case of termination for any other reason, the option will be
                  canceled immediately on the date employment ceases. In the
                  case of death or Total Disability (as defined below) the
                  options shall fully vest and will remain exercisable for three
                  years after employment ceases. In order to qualify for the
                  beneficial tax treatment afforded to incentive stock options,
                  the option must be exercised within three months after
                  termination of employment for reasons other than death or
                  Total Disability. Total Disability means a mental or physical
                  impairment of the Option which is expected to result in death
                  or which has lasted or is expected to last for a continuous
                  period of 12 months or more and which causes the optionee to
                  be unable, in the opinion of the Company and two independent
                  physicians, to perform his or her duties for the Company and
                  to be engaged in any substantial gainful activity. Total
                  Disability will be deemed to have occurred on the first day
                  after the Company and the two independent physicians have
                  furnished their opinion of total disability to the Committee.
                  Employment shall be deemed to continue while the Optionee is
                  on military leave, sick leave or other bona fide leave of
                  absence (as determined by the Committee), except that
                  employment shall not be deemed to continue beyond the first 90
                  days of such leave unless the Optionee's reemployment rights
                  are guaranteed by statute or by contract.

            (d)   The Committee may at any time determine that the option shall
                  not be exercised for less than 100 shares at any time.

            (e)   The option exercise price must be paid in full at the time of
                  exercise in cash or by check, or by (i) tendering (actually or
                  by attestation) shares of Common stock already owned by
                  Optionee, (ii) delivery of a properly executed exercise
                  notice, together with irrevocable instructions to (a) a
                  brokerage firm designated by Air Group to deliver promptly to
                  Air Group the aggregate amount of sale or loan

<PAGE>

                  proceeds to pay the option exercise price and any withholding
                  tax obligations that may arise in connection with the exercise
                  and (b) Air Group to deliver the certificates for such
                  purchased shares directly to such brokerage firm, all in
                  accordance with the regulations of the Federal Reserve Board;
                  or (iii) such other considerations as the Committee may permit
                  or any combination of the foregoing.

            (f)   In order to obtain certain tax benefits afforded to incentive
                  stock options under Section 422 of the Internal Revenue Code
                  of 1986, as amended from time to time, an optionee must hold
                  the shares issued upon the exercise of an incentive stock
                  option for two years after the date of grant of the option and
                  one year from the date of exercise. An optionee may be subject
                  to the alternative minimum tax at the time of exercise.

                  A disqualifying disposition of an incentive stock option award
                  or the exercise of nonqualified stock options may create
                  substantial ordinary income to Optionee, and Optionee hereby
                  authorizes the Company to make any appropriate withholding for
                  income taxes, including the retention of shares otherwise
                  issuable upon exercise of the option.

                  Tax advice should be obtained when exercising any option and
                  prior to the disposition of the shares issued upon the
                  exercise of any option.

            (g)   In the event of any Change of Control (as defined on Exhibit A
                  attached hereto) the option shall automatically accelerate so
                  that the option shall, immediately prior to the effective date
                  of the Change in Control, become 100% vested, unless
                  two-thirds of the Incumbent Directors (as defined on Exhibit
                  A) then in office shall have specifically determined in
                  advance to maintain in effect the vesting schedule set forth
                  in Section 3(a) of this Option Agreement.

                  The option shall terminate and cease to remain outstanding
                  immediately following the consummation of such Change of
                  Control, except to the extent assumed by the successor
                  corporation.

                  Unless the Board shall determine otherwise, the vesting
                  schedule set forth in Section 3(a) of this Option Agreement
                  shall not be accelerated by reason of any corporate
                  reorganization, merger, consolidation, transfer of assets,
                  liquidating distribution or other transaction entered into
                  solely by and among Air Group and/or its subsidiaries,
                  provided such transaction has been approved by two-thirds of
                  the Incumbent Directors then in office.

            (h)   To the extent that the aggregate fair market value (determined
                  as of the grant date) of the shares with respect to which the
                  incentive stock option is exercisable for the first time by
                  you during any calendar year (under this option and all other
                  incentive stock options you hold) exceeds $100,000, the excess
                  portion will be treated as nonqualified stock options, unless
                  the Internal Revenue Service changes the rules and regulations
                  governing the $100,000 limit for incentive stock options.

            (i)   If incentive stock options are granted under this Option
                  Agreement to persons who own more than ten percent of the
                  total combined voting power of all securities of Air Group,
                  the term of such incentive stock options shall not exceed five
                  years and the exercise price shall be not less than 110% of
                  the fair market value of the Common Stock on the date of
                  grant. This provision shall control notwithstanding any
                  contrary terms contained in this Option Agreement.

      4.    Nothing in the Plan or this Option Agreement shall confer upon
            Optionee any right to continue in the employ of the Company or its
            subsidiaries or to interfere in any way with the right of the
            Company to terminate his or her employment or other relationship
            with the Company at any time.

<PAGE>

AT THE PRESENT TIME, AIR GROUP HAS AN EFFECTIVE REGISTRATION STATEMENT WITH
RESPECT TO THE SHARES THAT WILL BE ISSUED UPON EXERCISE OF THIS OPTION. AIR
GROUP INTENDS TO MAINTAIN THIS REGISTRATION BUT HAS NO OBLIGATION TO DO SO. IN
THE EVENT THAT SUCH REGISTRATION IS NO LONGER EFFECTIVE, YOU WILL NOT BE ABLE TO
EXERCISE THE OPTION UNLESS EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE
SECURITIES LAWS ARE AVAILABLE; SUCH EXEMPTIONS FROM REGISTRATION ARE VERY
LIMITED AND MIGHT BE UNAVAILABLE.

IN WITNESS WHEREOF, Air Group and Optionee have executed this Agreement.

Optionee,                                           Alaska Air Group

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

PLEASE PROVIDE YOUR CURRENT COMAIL CODE AND HOME ADDRESS BELOW:

COMAIL
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<PAGE>

                                    EXHIBIT A

                                   DEFINITIONS

"Change in Control" means:

(a) Air Group's Stockholders shall approve and there shall occur:

            (i)   any consolidation or merger of Air Group in which Air Group is
                  not the continuing or surviving corporation or pursuant to
                  which shares of Common Stock would be converted into cash,
                  securities or other property, other than a merger of Air Group
                  in which the holders of Air Group's Common Stock immediately
                  prior to the merger have the same proportionate ownership of
                  common stock of the surviving corporation immediately after
                  the merger;

            (ii)  any sale, lease, exchange or other transfer (in one
                  transaction or a series of related transactions) of all, or
                  substantially all, the assets of Air Group or Alaska; or

            (iii) the adoption of any plan or proposal for the liquidation or
                  dissolution of Air Group or Alaska;

(b)   at any time during a period of two consecutive years, individuals who at
      the beginning of such period constituted the Board "Incumbent Directors")
      shall cease for any reason to constitute at least a majority thereof,
      unless each new director during such two-year period was nominated or
      elected by the Incumbent Directors, or a committee of the Incumbent
      Directors (new directors nominated or elected by the Incumbent Directors
      or by a committee of the Incumbent Directors shall also be deemed to be
      Incumbent Directors); or

(c)   an "Person (as such term is used in Section 13(d) of the Exchange Act)
      shall, as a result of a tender or exchange offer, open market purchases,
      privately negotiated purchases or otherwise, have become the beneficial
      owner (within the meaning of Rule 13d-3 under the Exchange Act), directly
      or indirectly, of then-outstanding securities of Air Group ordinarily (and
      apart from rights accruing under special circumstances) having the right
      to vote in the election of directors ("Voting Securities," to be
      calculated as provided in paragraph (d) of such Rule 13d-3 in the case of
      rights to acquire Common Stock) represent 20% or more of the combined
      voting power of the then-outstanding Voting Securities.

                                      # # #

<PAGE>

                             ALASKA AIR GROUP, INC.

                      2004 LONG-TERM INCENTIVE EQUITY PLAN

                      RESTRICTED STOCK UNIT AWARD AGREEMENT

Award Date                 Number of Units                    Final Vesting Date

      This Restricted Stock Unit Award Agreement ("Agreement") is made and
entered into as of the 6th day of December, 2004 by and between Alaska Air
Group, Inc. (the "Company") and __________ ("Participant"), an employee of a
wholly owned subsidiary of the Company.

      The Company has on the Award Date specified above granted to Participant
an award (the "Award") to receive that number of restricted stock units (the
"Restricted Stock Units") indicated above in the box labeled "Number of Units,"
each Restricted Stock Unit representing the right to receive one share of Alaska
Air Group Common Stock (the "Common Stock"), subject to certain restrictions and
on the terms and conditions contained in this Award and the Alaska Air Group,
Inc. 2004 Long-Term Incentive Equity Plan (the "Plan"). A copy of the Plan is
available upon request. In the event of any conflict between the terms of the
Plan and this Award, the terms of the Plan shall govern. Any capitalized terms
not defined herein shall have the meaning set forth in the Plan. This Agreement
shall be effective when signed by the Company and Recipient.

      1. Rights of the Participant with Respect to the Restricted Stock Units.

            a) No Shareholder Rights. The Restricted Stock Units granted
pursuant to this Award do not and shall not entitle Participant to any rights of
a shareholder of Common Stock, including without limitation voting rights or
dividends. The rights of Participant with respect to the Restricted Stock Units
shall remain forfeitable at all times prior to the date on which such rights
become vested, and the restrictions with respect to the Restricted Stock Units
lapse, in accordance with Section 2, 3 or 4.

            b) Conversion of Restricted Stock Units; Issuance of Common Stock.
No shares of Common Stock shall be issued to Participant prior to the date on
which the Restricted Stock Units vest, and the restrictions with respect to the
Restricted Stock Units lapse, in accordance with Section 2, 3 or 4. Neither this
Section 1(b) nor any action taken pursuant to or in accordance with this Section
1(b) shall be construed to create a trust of any kind. After any Restricted
Stock Units vest pursuant to Section 2, 3 or 4, and further provided that
Participant has fully complied with all of his or her obligations under this
Agreement and the Plan, the Company shall promptly cause to be issued in
book-entry form, registered in Participant's name or in the name of
Participant's legal representatives, beneficiaries or heirs, as the case may be,
Common Stock in payment of such vested whole Restricted Stock Units. The value
of any fractional Restricted Stock Unit shall be paid in cash at any time the
Common Stock is delivered to Participant in payment of the Restricted Stock
Units.

                                        1
<PAGE>

      2. Vesting. Subject to the terms and conditions of this Award, the
Restricted Stock Units shall vest, and the restrictions with respect to the
Restricted Stock Units shall lapse, on the third anniversary of the Award Date
if Participant remains continuously employed by the Company.

      3. Early Vesting Upon Change in Control. Notwithstanding the other vesting
provisions contained in Section 2, but subject to the other terms and conditions
set forth herein, upon the effective date of a Change in Control (as defined in
Exhibit A attached hereto), all of the Restricted Stock Units shall become
immediately and unconditionally vested and exercisable, and the restrictions
with respect to all of the Restricted Stock Units shall lapse, unless two-thirds
of the Incumbent Directors (as defined in Exhibit A) then in office shall have
specifically determined in advance to maintain in effect the vesting schedule
set forth in Section 2 of this Agreement.

      4. Forfeiture or Early Vesting Upon Termination of Employment

            a) Retirement. If the employment of Participant with the Company
(including its subsidiaries) ceases due to retirement or early retirement (with
the Committee's approval in the case of early retirement), then the Award will
continue to vest for three years following the date of retirement according to
the vesting schedule set forth in this Award. For Purposes of this agreement, an
employee is considered to have retired if, on the date of termination any of the
following applies: (i) he or she is at least 55 years of age and has five years
of service with the Company or its subsidiaries, (ii) is at least 60 years of
age, or (iii) is a participant and is entitled to commence a benefit under a
Company-sponsored defined benefit plan.

            b) Total Disability. In the case of death or Total Disability (as
defined below) the Award will fully vest. Total Disability means a mental or
physical impairment of the Participant which is expected to result in death or
which has lasted or is expected to last for a continuous period of 12 months or
more and which causes the Participant to be unable, in the opinion of the
Company and two independent physicians, to perform his or her duties for the
Company and to be engaged in any substantial gainful activity. Total Disability
will be deemed to have occurred on the first day after the Company and the two
independent physicians have furnished their opinion of total disability to the
Committee.

            c) Other Termination. In the case of termination for any other
reason, the Award will be canceled and forfeited immediately on the date
employment ceases.

            d) Leave of Absence. Employment shall be deemed to continue while
the Participant is on military leave, sick leave or other bona fide leave of
absence (as determined by the Committee), except that employment shall not be
deemed to continue beyond the first 90 days of such leave unless the Optionee's
reemployment rights are guaranteed by statute or by contract.

      5. Restriction on Transfer. The Restricted Stock Units and any rights
under this Award may not be sold, assigned, transferred, pledged, hypothecated
or otherwise disposed of by Participant otherwise than by will or by the laws of
descent and distribution, and any such purposed sale, assignment, transfer,
pledge, hypothecation or other disposition shall be void and

                                        2
<PAGE>

unenforceable against the Company. Notwithstanding the foregoing, Participant
may, in the manner established by the Committee, designate a beneficiary or
beneficiaries to exercise the rights of Participant and receive any property
distributable with respect to the Restricted Stock Units upon the death of
Participant.

      6. Adjustments to Restricted Stock Units.

            a) In the event that any stock dividend, stock split, combination or
exchange of shares, merger, consolidation, spin-off, recapitalization or other
distribution (other than normal cash dividends) of Company assets to
stockholders, or any other similar corporate transaction or event affecting the
Common Stock would be reasonably likely to result in the diminution or
enlargement of any of the benefits or potential benefits intended to be made
available under the Award (including, without limitation, the benefits or
potential benefits of provisions relating to the vesting of the Restricted Stock
Units), the Committee shall, in such manner as it shall deem equitable or
appropriate in order to prevent such diminution or enlargement of any such
benefits or potential benefits, make adjustments to the Award, including
adjustments in the number and type of shares of Common Stock Participant would
have received upon vesting of the Restricted Stock Units; provided, however,
that the number of shares into which the Restricted Stock Units may be converted
shall always be a whole number.

      7. Income and Payroll Tax Matters.

            a) Participant is ultimately and solely liable and responsible for
all taxes owed in connection with the Award and the Company does not make any
representation or undertaking regarding the treatment of any tax withholding in
connection with the grant or vesting of the Award or the subsequent sale of
shares of Common Stock issuable pursuant to the Award. In order to comply with
all applicable federal, state or local income tax laws or regulations, the
Company may take such action as it deems appropriate to ensure that all
applicable federal, state or local payroll, withholding, income or other taxes
are withheld or collected from Participant.

            b) In order to comply with recently enacted legislation affecting
deferred compensation plans, Participant agrees that some provisions of this
Agreement may need to be adjusted, to specify more clearly the distribution
dates specified in Section 1(b) above for the Common Stock to be issued under
this Restricted Stock Unit, or to add other provisions that may be required to
ensure that this Restricted Stock Unit Agreement operates in compliance with the
new legislation, and with the regulations to be issued thereunder.

            c) In accordance with the terms of the Plan, and such rules as may
be adopted by the Committee under the Plan, the Company will withhold, at the
applicable federal supplemental wage withholding rate, a portion of the shares
of Common Stock otherwise to be delivered having a fair market value equal to
the amount of such taxes in order to fulfill Participant's federal income tax
withholding obligations arising from the receipt of Common Stock in payment of
the Restricted Stock Units, or, if applicable, the lapse of restrictions
relating to the Restricted Stock Units. Any state income taxes or other payroll
taxes, such as FICA or Medicare, due may also be withheld from the shares
delivered or from subsequent paychecks, at the Company's discretion. The Company
will not deliver any fractional share of Common Stock but will pay, in lieu
thereof, the fair market value of such fractional share. As a condition and

                                        3
<PAGE>

term of this Award, Participant shall not make an election under Section 83(b)
of the Internal Revenue Code with respect to all or any portion of the Award.

      8. Miscellaneous.

            a) This Award does not confer on Participant any right with respect
to the continuance of any relationship with the Company or its subsidiaries, nor
will it interfere in any way with the right of the Company to terminate such
relationship at any time. Furthermore, nothing herein creates any contractual or
other right to receive future grants of awards.

            b) The Company shall not be required to deliver any shares of Common
Stock upon vesting of any Restricted Stock Units until the requirements of any
federal or state securities laws, rules or regulations or other laws or rules
(including the rules of any securities exchange) as may be determined by the
Company to be applicable are satisfied.

            c) An original record of this Award and all the terms hereof,
executed by the Company, is held on file by the Company. To the extent there is
any conflict between the terms contained in this Award and the terms contained
in the original held by the Company, the terms of the original held by the
Company shall control. If Participant does not sign and return this Agreement,
the Company is not obligated to provide Participant with any benefit hereunder
and may refuse to issue shares of Common Stock to Participant under this Award.
This Agreement replaces and supersedes that Restricted Stock Unit Agreement
dated November 10, 2004 (the "Prior Agreement"). Participant hereby waives all
of Participant's rights under the Prior Agreement and agrees that the Prior
Agreement shall terminate in full upon Participant's execution of this
Agreement.

IN WITNESS WHEREOF, the Company and Participant have executed this Agreement.

PARTICIPANT                                             COMPANY

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

Please provide your current COMAIL and home address below:

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                                        4
<PAGE>

                                    EXHIBIT A

                                   DEFINITIONS

"Change in Control" means:

(a) Air Group's Stockholders shall approve and there shall occur:

            (i)   any consolidation or merger of Air Group in which Air Group is
                  not the continuing or surviving corporation or pursuant to
                  which shares of Common Stock would be converted into cash,
                  securities or other property, other than a merger of Air Group
                  in which the holders of Air Group's Common Stock immediately
                  prior to the merger have the same proportionate ownership of
                  common stock of the surviving corporation immediately after
                  the merger;

            (ii)  any sale, lease, exchange or other transfer (in one
                  transaction or a series of related transactions) of all, or
                  substantially all, the assets of Air Group or Alaska; or

            (iii) the adoption of any plan or proposal for the liquidation or
                  dissolution of Air Group or Alaska;

(b)   at any time during a period of two consecutive years, individuals who at
      the beginning of such period constituted the Board "Incumbent Directors")
      shall cease for any reason to constitute at least a majority thereof,
      unless each new director during such two-year period was nominated or
      elected by the Incumbent Directors, or a committee of the Incumbent
      Directors (new directors nominated or elected by the Incumbent Directors
      or by a committee of the Incumbent Directors shall also be deemed to be
      Incumbent Directors); or

(c)   an "Person (as such term is used in Section 13(d) of the Exchange Act)
      shall, as a result of a tender or exchange offer, open market purchases,
      privately negotiated purchases or otherwise, have become the beneficial
      owner (within the meaning of Rule 13d-3 under the Exchange Act), directly
      or indirectly, of then-outstanding securities of Air Group ordinarily (and
      apart from rights accruing under special circumstances) having the right
      to vote in the election of directors ("Voting Securities," to be
      calculated as provided in paragraph (d) of such Rule 13d-3 in the case of
      rights to acquire Common Stock) represent 20% or more of the combined
      voting power of the then-outstanding Voting Securities.

                                      # # #

                                       5

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