Exhibit 10.4

                              RITE AID CORPORATION
                            2004 OMNIBUS EQUITY PLAN

1. Purpose; Establishment.

The Rite Aid Corporation 2004 Omnibus Equity Plan (the "Plan") is intended to
promote the interests of the Company and its shareholders by providing officers
and other employees of the Company (including directors who are also employees
of the Company) with appropriate incentives and rewards to encourage them to
enter into and continue in the employ of the Company and to acquire a
proprietary interest in the long-term success of the Company; and to reward the
performance of individual officers, other employees, non-employee directors and
consultants in fulfilling their personal responsibilities for long-range
achievements. The Plan has been adopted and approved by the Board of Directors
(defined below) and shall become effective as of June 24, 2004, subject to the
approval of the shareholders of the Company.

2. Definitions.

As used in the Plan, the following definitions apply to the terms indicated
below:

(a) "Affiliate" means any entity if, at the time of granting of an Award (1) the
Company, directly or indirectly, owns at least 50% of the combined voting power
of all classes of stock of such entity or at least 50% of the ownership
interests in such entity or (2) such entity, directly or indirectly, owns at
least 50% of the combined voting power of all classes of stock of the Company.

(b) "Agreement" shall mean the written agreement between the Company and a
Participant evidencing an Award or a notice of an Award delivered to a
Participant by the Company.

(c) "Award" shall mean any Option, Restricted Stock, Phantom Stock, Stock Bonus
or Other Award granted pursuant to the terms of the Plan.

(d) "Board of Directors" shall mean the Board of Directors of the Company.

(e) "Business Criteria" shall mean (1) return on total stockholder equity; (2)
earnings or book value per share of Company Stock; (3) net income (before or
after taxes); (4) earnings before all or any interest, taxes, depreciation
and/or amortization ("EBIT", "EBITA" or "EBITDA"); (5) inventory goals; (6)
return on assets, capital or investment; (7) market share; (8) cost reduction
goals; (9) earnings from continuing operations; (10) levels of expense, costs or
liabilities; (11) store level performance; (12) operating profit; (13) sales or
revenues; (14) stock price appreciation; (15) total shareholder return; (16)
implementation or completion of critical projects or processes; or (17) any
combination of the foregoing. Where applicable, Business Criteria may be
expressed in terms of attaining a specified level of the particular criteria or
the attainment of a percentage increase or decrease in the particular criteria,
and may be applied to one or more of the Company, an Affiliate, or a division or
strategic business unit of the Company, or may be applied to the performance of
the Company relative to a market index, a group of other companies or a
combination thereof, all as determined by the Committee. The Business Criteria
may be subject to a threshold level of performance below which no payment will
be made (or no




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vesting will occur), levels of performance at which specified payments will be
made (or specified vesting will occur), and a maximum level of performance above
which no additional payment will be made (or at which full vesting will occur).
Each of the Business Criteria shall be determined, where applicable, in
accordance with generally accepted accounting principles and shall be subject to
certification by the Committee; provided that the Committee shall have the
authority to make equitable adjustments to the Business Criteria in recognition
of unusual or non-recurring events affecting the Company or any Affiliate or the
financial statements of the Company or any Affiliate, in response to changes in
applicable laws or regulations, or to account for items of gain, loss or expense
determined to be extraordinary or unusual in nature or infrequent in occurrence
or related to the disposal of a segment of a business or related to a change in
accounting principles.

(f) "Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time, and any regulations promulgated thereunder.

(g) "Committee" shall mean a committee of the Board of Directors, which shall
consist of two or more persons, each of whom shall qualify as an "outside
director" within the meaning of Section 162(m) of the Code, a "nonemployee
director" within the meaning of Rule 16b-3 and an "independent director" within
the meaning of the New York Stock Exchange Listed Company Manual.

(h) "Company" shall mean Rite Aid Corporation, a Delaware corporation, and,
where appropriate, each of its Affiliates.

(i) "Company Stock" shall mean the common stock of the Company, par value $1.00
per share.

(j) "Covered Employee" shall have the meaning set forth in Section 162(m) of the
Code.

(k) "Effective Date" shall mean June 24, 2004.

(l) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
from time to time.

(m) "Fair Market Value" shall mean, with respect to a share of Company Stock,
the average of the high and low price of Company Stock as quoted on the
composite tape of the New York Stock Exchange and published in The Wall Street
Journal with respect to the date on which the Fair Market Value is to be
determined, or if there is no trading of Company Stock on such date, such price
on the next preceding date on which there was trading in such shares.

(n) "Incentive Stock Option" shall mean an Option that qualifies as an
"incentive stock option" within the meaning of Section 422 of the Code, or any
successor provision, and which is designated by the Committee as an Incentive
Stock Option.

(o) "Nonqualified Stock Option" shall mean an Option other than an Incentive
Stock Option.

(p) "Option" shall mean an option to purchase shares of Company Stock granted
pursuant to Section 7.


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(q) "Other Award" shall mean an Award granted pursuant to Section 11 hereof.

(r) "Participant" shall mean an employee, non-employee director or consultant of
the Company to whom an Award is granted pursuant to the Plan.

(s) "Phantom Stock" shall mean the right, granted pursuant to Section 9, to
receive in cash or shares the Fair Market Value of a share of Company Stock.

(t) "Restricted Stock" shall mean a share of Company Stock which is granted
pursuant to the terms of Section 8 hereof and which is subject to restrictions
as set forth in Section 8(d).

(u) "Rule 16b-3" shall mean the Rule 16b-3 promulgated under the Exchange Act,
as amended from time to time.

(v) "Securities Act" shall mean the Securities Act of 1933, as amended from time
to time.

(w) "Stock Appreciation Right" shall mean the right to receive, upon exercise of
the right, the applicable amounts as described in Section 8.

(x) "Stock Bonus" shall mean a bonus payable in shares of Company Stock granted
pursuant to Section 10.

(y) "Subsidiary" shall mean a "subsidiary corporation" of the Company within the
meaning of Section 424(f) of the Code.

3. Stock Subject to the Plan.

(a) Shares Available for Awards. The maximum number of shares of Company Stock
reserved for issuance under the Plan shall be 20,000,000 shares (subject to
adjustment as provided herein). Such shares may be authorized but unissued
shares of Company Stock or authorized and issued shares of Company Stock held in
the Company's treasury. The maximum number of such shares of Company Stock that
may be granted under the Plan pursuant to Awards (other than Options or Stock
Appreciation Rights granted in tandem with Options) shall not exceed 10,000,000
(subject to adjustment as provided herein).

(b) Individual Limitation; Limitation on Certain Awards. The maximum number of
shares of Company Stock to which Awards relate that may be granted to any
Participant during any calendar year shall not exceed 1,000,000 shares (subject
to adjustment as provided herein).

(c) Adjustment for Change in Capitalization. In the event that any dividend or
other distribution is declared (whether in the form of cash, Company Stock, or
other property), or there occurs any recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, spin-off, combination,
repurchase, share exchange or other similar corporate transaction or event, the
Committee shall adjust, in its sole and absolute discretion, (1) the number and
kind of shares of stock which may thereafter be issued in connection with
Awards, (2) the number and kind of shares of stock or other property issued or
issuable in respect of outstanding Awards, (3) the exercise price, grant price
or purchase price relating



                                    3




to any Award, and (4) the limitations set forth in Sections 3(a) and 3(b);
provided that, with respect to Incentive Stock Options, such adjustment shall be
made in accordance with Section 424 of the Code.

(d) Reuse of Shares. Except to the extent that to do so would prevent the grant
of Incentive Stock Options hereunder, the following shares of Company Stock
shall again become available for Awards: (1) any shares subject to an Award that
remain unissued upon the cancellation, surrender, exchange or termination of
such Award without having been exercised or settled; (2) any shares subject to
an Award that are retained by the Company as payment of the exercise price or
tax withholding obligations with respect to an Award; and (3) a number of shares
equal to the number of previously owned shares of Company Stock surrendered to
the Company as payment of the exercise price of an Option or to satisfy tax
withholding obligations with respect to an Award. In addition, (A) to the extent
an Award is paid or settled in cash, the number of shares of Company Stock with
respect to which such payment or settlement is made shall again be available for
grants of Awards pursuant to the Plan and (B) in the event of the exercise of a
Stock Appreciation Right granted in relation to an Option, the excess of the
number of shares subject to the Stock Appreciation Right over the number of
shares delivered upon the exercise of the Stock Appreciation Right shall again
be available for grants of Awards pursuant to the Plan.

4. Administration of the Plan.

The Plan shall be administered by the Committee. The Committee shall have the
authority in its sole discretion, subject to and not inconsistent with the
express provisions of the Plan, to administer the Plan and to exercise all the
powers and authorities either specifically granted to it under the Plan or
necessary or advisable in the administration of the Plan, including, without
limitation, the authority to grant Awards; to determine the persons to whom and
the time or times at which Awards shall be granted; to determine the type and
number of Awards to be granted, the number of shares of Company Stock or cash or
other property to which an Award may relate and the terms, conditions,
restrictions and performance criteria relating to any Award; to determine
whether, to what extent, and under what circumstances an Award may be settled,
cancelled, forfeited, exchanged, or surrendered; to construe and interpret the
Plan and any Award; to prescribe, amend and rescind rules and regulations
relating to the Plan; to determine the terms and provisions of Agreements; and
to make all other determinations deemed necessary or advisable for the
administration of the Plan. The Committee may, in its sole and absolute
discretion, without amendment to the Plan, (a) accelerate the date on which any
Option or Stock Appreciation Right becomes exercisable, (b) waive or amend the
operation of Plan provisions respecting exercise after termination of employment
(provided that the term of an Option or Stock Appreciation Right may not be
extended beyond ten years from the date of grant), (c) accelerate the vesting
date, or waive any condition imposed hereunder, with respect to any share of
Restricted Stock, Phantom Stock, Stock Bonus or Other Award, and (d) otherwise
adjust any of the terms applicable to any such Award in a manner consistent with
the terms of the Plan. Notwithstanding anything in the Plan to the contrary, the
powers and authority of the Committee shall be exercised by the Board of
Directors in the case of Awards made to non-employee directors.

5. Eligibility.

The persons who shall be eligible to receive Awards pursuant to the Plan shall
be such employees of the Company (including officers of the Company, whether or
not they are


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directors of the Company), consultants to the Company and non-employee directors
of the Company, in each case as the Committee (or, in the case of non-employee
directors, the Board of Directors) shall select from time to time. The grant of
an Award hereunder in any year to any Employee, non-employee director or
consultant shall not entitle such person to a grant of an Award in any future
year.

6. Awards Under the Plan; Agreement.

The Committee may grant Options, Stock Appreciation Rights, Restricted Stock,
Phantom Stock, Stock Bonuses and Other Awards in such amounts and with such
terms and conditions as the Committee shall determine, subject to the provisions
of the Plan. Each Award granted under the Plan (except an unconditional Stock
Bonus) shall be evidenced by an Agreement which shall contain such provisions as
the Committee may in its sole discretion deem necessary or desirable and which
are not in conflict with the terms of the Plan. By accepting an Award, a
Participant shall be deemed to agree that the Award shall be subject to all of
the terms and provisions of the Plan and the applicable Agreement.

7. Options.

(a) Identification of Options. Each Option shall be clearly identified in the
applicable Agreement as either an Incentive Stock Option or a Nonqualified Stock
Option. All Options shall be non-transferable, except by will or the laws of
descent and distribution or except as otherwise determined by the Committee with
respect to a Nonqualified Stock Option.

(b) Exercise Price. Each Agreement with respect to an Option shall set forth the
amount per share (the "option exercise price") payable by the Participant to the
Company upon exercise of the Option. The option exercise price shall be equal to
or greater then the Fair Market Value of a share of Company Stock on the date of
grant. Other than with respect to an adjustment described in Section 3, in no
event shall the option exercise price be reduced following the grant of an
Option, nor shall an Option be cancelled in exchange for a replacement Option
with a lower exercise price. In addition, the Committee shall not have the
authority to grant an Option which provides that the Participant will be granted
a new Option (sometimes referred to as a "reload option") for a number of shares
equal to the number of shares surrendered by the Participant upon exercise of
all or a part of the original Option.

(c) Term and Exercise of Options.

(i) Each Option shall become exercisable at the time determined by the Committee
and set forth in the applicable Agreement. At the time of grant of an Option,
the Committee may impose such restrictions or conditions to the exercisability
of the Option as it, in its absolute discretion, deems appropriate, including,
but not limited to, achievement of performance goals based on one or more
Business Criteria. Except as may be set forth in an Agreement with respect to
vesting of an Option upon termination of employment or service or upon a change
in control of the Company, Options granted hereunder that vest solely upon the
continued employment or service of the Participant may not become fully vested
prior to the third anniversary of the date upon which the Option is granted.
Subject to Section 7(d) hereof, the Committee shall determine the expiration
date of each Option, which shall be no later than the tenth anniversary of the
date of grant of the Option.


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(ii) An Option shall be exercised by delivering the form of notice of exercise
provided by the Company. Payment for shares of Company Stock purchased upon the
exercise of an Option shall be made on the effective date of such exercise by
one or a combination of the following means: (A) in cash or by personal check,
certified check, bank cashier's check or wire transfer; (B) in shares of Company
Stock owned by the Participant for at least six months prior to the date of
exercise and valued at their Fair Market Value on the effective date of such
exercise; or (C) by any such other methods (including broker assisted cashless
exercise) as the Committee may from time to time authorize; provided, however,
that in the case of a Participant who is subject to Section 16 of the Exchange
Act, the method of making such payment shall be in compliance with applicable
law. Any payment in shares of Company Stock shall be effected by the delivery of
such shares to the Secretary of the Company, duly endorsed in blank or
accompanied by stock powers duly executed in blank, together with any other
documents and evidences as the Secretary of the Company shall require.

(iii) Certificates for shares of Company Stock purchased upon the exercise of an
Option shall be issued in the name of or for the account of the Participant or
other person entitled to receive such shares, and delivered to the Participant
or such other person as soon as practicable following the effective date on
which the Option is exercised.

(d) Provisions Relating to Incentive Stock Options. Incentive Stock Options may
only be granted to employees of the Company and its Affiliates, in accordance
with the provisions of Section 422 of the Code. To the extent that the aggregate
Fair Market Value of shares of Company Stock with respect to which Incentive
Stock Options are exercisable for the first time by a Participant during any
calendar year under the Plan and any other stock option plan of the Company or a
Subsidiary shall exceed $100,000, such Options shall be treated as Nonqualified
Stock Options. For purposes of this Section 7(d), Fair Market Value shall be
determined as of the date on which each such Incentive Stock Option is granted.
No Incentive Stock Option may be granted to an individual if, at the time of the
proposed grant, such individual owns (or is deemed to own under the Code) stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company unless (A) the exercise price of such Incentive
Stock Option is at least 110% of the Fair Market Value of a share of Company
Stock at the time such Incentive Stock Option is granted and (B) such Incentive
Stock Option is not exercisable after the expiration of five years from the date
such Incentive Stock Option is granted.

(e) Effect of Termination of Employment (or Provision of Services). In the event
that the employment of a Participant with the Company (or the Participant's
service to the Company) shall terminate for any reason other than (i) cause (as
defined in the applicable Agreement), (ii) death or (iii) disability or
retirement, each Option granted to such Participant, to the extent that it is
exercisable at the time of such termination, shall remain exercisable for the 90
day period following such termination (or for such other period as may be
provided by the Committee), but in no event following the expiration of its
term. Each Option that remains unexercisable as of the date of such a
termination shall be terminated at the time of such termination (except as may
be otherwise determined by the Committee). In the event that the employment of a
Participant with the Company (or the Participant's service to the Company) shall
terminate on account of the death of the Participant, each Option granted to
such Participant that is outstanding as of the date of death shall become fully
exercisable and shall remain exercisable by the Participant's legal
representatives, heirs or legatees for the one year period following such
termination (or for such other period as may be provided by the Committee), but
in no event following the




                                      6




expiration of its term. In the event of the termination of a Participant's
employment for cause (as defined in the applicable Agreement), each outstanding
Option granted to such Participant shall terminate at the commencement of
business on the date of such termination. In the event that the employment of a
Participant with the Company (or the Participant's service to the Company) shall
terminate on account of the disability or retirement of the Participant (in each
case as determined by the Committee), each Option granted to such Participant
that is outstanding and vested as of the date of such termination shall remain
exercisable by the Participant (or such Participant's legal representatives) for
the one year period following such termination (or for such other period as may
be provided by the Committee), but in no event following the expiration of its
term. Each Option that remains unexercisable as of the date of a termination due
to disability or retirement shall be terminated at the time of such termination
(except as may be otherwise determined by the Committee).

(f) Leave of Absence. In the case of any Participant on an approved leave of
absence, the Committee may make such provision respecting the continuance of the
Option while in the employ or service of the Company as it may deem equitable,
except that in no event may an Option be exercised after the expiration of its
term.

8. Stock Appreciation Rights.

(a) A Stock Appreciation Right may be granted in connection with an Option,
either at the time of grant or, with respect to a Nonqualified Stock Option, at
any time thereafter during the term of the Option, or may be granted unrelated
to an Option. At the time of grant of a Stock Appreciation Right, the Committee
may impose such restrictions or conditions to the exercisability of the Stock
Appreciation Right as it, in its absolute discretion, deems appropriate,
including, but not limited to, achievement of performance goals based on one or
more Business Criteria. The term of a Stock Appreciation Right granted without
relationship to an Option shall not exceed ten years from the date of grant.

(b) A Stock Appreciation Right related to an Option shall require the holder,
upon exercise, to surrender such Option with respect to the number of shares as
to which such Stock Appreciation Right is exercised, in order to receive payment
of any amount computed pursuant to Section 8(d). Such Option will, to the extent
surrendered, then cease to be exercisable.

(c) Subject to Section 8(i) and to such rules and restrictions as the Committee
may impose, a Stock Appreciation Right granted in connection with an Option will
be exercisable at such time or times, and only to the extent that a related
Option is exercisable, and will not be transferable except to the extent that
such related Option may be transferable.

(d) Upon the exercise of a Stock Appreciation Right related to an Option, the
holder will be entitled to receive payment of an amount determined by
multiplying:

(i) the excess of the Fair Market Value of a share of Company Stock on the date
of exercise of such Stock Appreciation Right over the option exercise price
specified in the related Option, by

(ii) the number of shares as to which such Stock Appreciation Right is
exercised.

(e) A Stock Appreciation Right granted without relationship to an Option will
entitle the holder, upon exercise of the Stock Appreciation Right, to receive
payment of an amount determined by multiplying:



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(i) the excess of (1) the Fair Market Value of a share of Company Stock on the
date of exercise of such Stock Appreciation Right over (2) the greater of the
Fair Market Value of a share of Company Stock on the date the Stock Appreciation
Right was granted or such greater amount as may be set forth in the applicable
Agreement, by

(ii) the number of shares as to which such Stock Appreciation Right is
exercised.

(f) Notwithstanding subsections (d) and (e) above, the Committee may place a
limitation on the amount payable upon exercise of a Stock Appreciation Right.
Any such limitation must be determined as of the date of grant and noted in the
applicable Agreement.

(g) Payment of the amount determined under subsections (d) and (e) above may be
made solely in whole shares of Company Stock valued at their Fair Market Value
on the date of exercise of the Stock Appreciation Right or alternatively, in the
sole discretion of the Committee, solely in cash or a combination of cash and
shares. If the Committee decides that payment will be made in shares of Company
Stock, and the amount payable results in a fractional share, payment for the
fractional share will be made in cash.

(h) Other than with respect to an adjustment described in Section 3, in no event
shall the exercise price with respect to a Stock Appreciation Right be reduced
following the grant of such Stock Appreciation Right, nor shall the Stock
Appreciation Right be cancelled in exchange for a replacement Stock Appreciation
Right with a lower exercise price.

(i) In the event that the employment of a Participant with the Company (or the
Participant's service to the Company) shall terminate for any reason other than
(i) cause (as defined in the applicable Agreement), or (ii) death, each Stock
Appreciation Right granted to such Participant, to the extent that it is
exercisable at the time of such termination, shall remain exercisable for the 90
day period following such termination (or for such other period as may be
provided by the Committee), but in no event following the expiration of its
term. Any Stock Appreciation Right that is not exercisable as of the date of
such a termination shall be terminated at the time of such termination (except
as may be otherwise determined by the Committee). In the event that the
employment of a Participant with the Company (or the Participant's service to
the Company) shall terminate on account of the death of the Participant, each
Stock Appreciation Right granted to such Participant that is outstanding as of
the date of death shall become fully exercisable and shall remain exercisable by
the Participant's legal representatives, heirs or legatees for the one year
period following such termination (or for such other period as may be provided
by the Committee), but in no event following the expiration of its term. In the
event of the termination of a Participant's employment for cause (as defined in
the applicable Agreement), each outstanding Stock Appreciation Right granted to
such Participant shall terminate at the commencement of business on the date of
such termination.

9. Restricted Stock.

(a) Price. At the time of the grant of shares of Restricted Stock, the Committee
shall determine the price, if any, to be paid by the Participant for each share
of Restricted Stock subject to the Award.

(b) Vesting Date. At the time of the grant of shares of Restricted Stock, the
Committee shall establish a vesting date or vesting dates with respect to such
shares. The Committee may divide such shares into classes and assign a different
vesting date for each class.



                                    8





Provided that all conditions to the vesting of a share of Restricted Stock are
satisfied, and subject to Section 9(h), upon the occurrence of the vesting date
with respect to a share of Restricted Stock, such share shall vest and the
restrictions of Section 9(d) shall lapse. Except as may be set forth in an
Agreement with respect to vesting of Restricted Stock upon termination of
employment or service or upon a change in control of the Company, Restricted
Stock granted hereunder that vests solely upon the continued employment or
service of the Participant may not become fully vested prior to the third
anniversary of the date upon which the Restricted Stock is granted.

(c) Conditions to Vesting. At the time of the grant of shares of Restricted
Stock, the Committee may impose such restrictions or conditions to the vesting
of such shares as it, in its absolute discretion, deems appropriate, including,
but not limited to, achievement of performance goals based on one or more
Business Criteria. The Committee may also provide that the vesting or forfeiture
of shares of Restricted Stock may be based upon the achievement of, or failure
to achieve, certain levels of performance and may provide for partial vesting of
Restricted Stock in the event that the maximum level of performance is not met
if the minimum level of performance has been equaled or exceeded.

(d) Restrictions on Transfer Prior to Vesting. Prior to the vesting of a share
of Restricted Stock, such Restricted Stock may not be transferred, assigned or
otherwise disposed of, and no transfer of a Participant's rights with respect to
such Restricted Stock, whether voluntary or involuntary, by operation of law or
otherwise, shall be permitted. Immediately upon any attempt to transfer such
rights, such shares, and all of the rights related thereto, shall be forfeited
by the Participant.

(e) Dividends on Restricted Stock. The Committee in its discretion may require
that any dividends paid on shares of Restricted Stock be held in escrow until
all restrictions on such shares have lapsed.

(f) Issuance of Certificates. The Committee may, upon such terms and conditions
as it determines, provide that (1) a certificate or certificates representing
the shares underlying a Restricted Stock award shall be registered in the
Participant's name and bear an appropriate legend specifying that such shares
are not transferable and are subject to the provisions of the Plan and the
restrictions, terms and conditions set forth in the applicable Agreement, (2)
such certificate or certificates shall be held in escrow by the Company on
behalf of the Participant until such shares become vested or are forfeited or
(3) the Participant's ownership of the Restricted Stock shall be registered by
the Company in book entry form.

(g) Consequences of Vesting. Upon the vesting of a share of Restricted Stock
pursuant to the terms hereof, the restrictions of Section 8(d) shall lapse with
respect to such share. Following the date on which a share of Restricted Stock
vests, the Company shall cause to be delivered to the Participant to whom such
shares were granted, a certificate evidencing such share, which may bear a
restrictive legend, if the Committee determines such a legend to be appropriate.

(h) Effect of Termination of Employment (or Provision of Services). Except as
may otherwise be provided in the applicable Agreement, and subject to the
Committee's authority under Section 4 hereof, upon the termination of a
Participant's employment (or upon cessation of such Participant's services to
the Company) for any reason, any and all shares to which restrictions on
transferability apply shall be immediately forfeited by the Participant and
transferred to, and reacquired by, the Company. In the event of a forfeiture


                                    9





of shares pursuant to this section, the Company shall repay to the Participant
(or the Participant's estate) any amount paid by the Participant for such
shares. In the event that the Company requires a return of shares, it shall also
have the right to require the return of all dividends paid on such shares,
whether by termination of any escrow arrangement under which such dividends are
held or otherwise.

10. Phantom Stock.

(a) Vesting Date. At the time of the grant of shares of Phantom Stock, the
Committee shall establish a vesting date or vesting dates with respect to such
shares. The Committee may divide such shares into classes and assign a different
vesting date for each class. Provided that all conditions to the vesting of a
share of Phantom Stock imposed pursuant to Section 10(c) are satisfied, and
subject to Section 10(d), upon the occurrence of the Vesting Date with respect
to a share of Phantom Stock, such share shall vest.

(b) Benefit Upon Vesting. Unless otherwise provided in an Agreement, upon the
vesting of a share of Phantom Stock, the Participant shall be paid, within 30
days of the date on which such share vests, an amount, in cash and/or shares of
Company Stock, as determined by the Committee, equal to the sum of (1) the Fair
Market Value of a share of Company Stock on the date on which such share of
Phantom Stock vests and (2) the aggregate amount of cash dividends paid with
respect to a share of Company Stock during the period commencing on the date on
which the share of Phantom Stock was granted and terminating on the date on
which such share vests.

(c) Conditions to Vesting. At the time of the grant of shares of Phantom Stock,
the Committee may impose such restrictions or conditions to the vesting of such
shares as it, in its absolute discretion, deems appropriate, including, but not
limited to, achievement of performance goals based on one or more Business
Criteria.

(d) Effect of Termination of Employment (or Provision of Services). Except as
may otherwise be provided in the applicable Agreement, and subject to the
Committee's authority under to Section 4 hereof, shares of Phantom Stock that
have not vested, together with any dividends credited on such shares, shall be
forfeited upon the Participant's termination of employment (or upon cessation of
such Participant's services to the Company) for any reason.

11. Stock Bonuses.

In the event that the Committee grants a Stock Bonus, a certificate for the
shares of Company Stock constituting such Stock Bonus shall be issued in the
name of the Participant to whom such grant was made and delivered to such
Participant as soon as practicable after the date on which such Stock Bonus is
payable.

12. Other Awards.

Other forms of Awards ("Other Awards") valued in whole or in part by reference
to, or otherwise based on, Company Stock may be granted either alone or in
addition to other Awards under the Plan. Subject to the provisions of the Plan,
the Committee shall have sole and complete authority to determine the persons to
whom and the time or times at which such Other Awards shall be granted, the
number of shares of Company Stock to be granted pursuant to such Other Awards,
or the conditions to the vesting and/or payment of



                                10






such Other Awards (which may include, but not be limited to, achievement of
performance goals based on one or more Business Criteria) and all other terms
and conditions of such Other Awards.

13. Special Provisions Regarding Certain Awards.

The Committee may make Awards hereunder to Covered Employees (or to individuals
whom the Committee believes may become Covered Employees) that are intended to
qualify as performance-based compensation under Section 162(m) of the Code. The
exercisability and/or payment of such Awards may be subject to the achievement
of performance goals based upon one or more Business Criteria and to
certification of such achievement in writing by the Committee. Such performance
goals shall be established in writing by the Committee not later than the time
period prescribed under Section 162(m) and the regulations thereunder. All
provisions of such Awards which are intended to qualify as performance-based
compensation shall be construed in a manner to so comply.

14. Rights as a Shareholder.

No person shall have any rights as a shareholder with respect to any shares of
Company Stock covered by or relating to any Award until the date of issuance of
a stock certificate with respect to such shares. Except for adjustments provided
in Section 3(c), no adjustment to any Award shall be made for dividends or other
rights for which the record date occurs prior to the date such stock certificate
is issued.

15. No Employment Rights; No Right to Award.

Nothing contained in the Plan or any Agreement shall confer upon any Participant
any right with respect to the continuation of employment by or provision of
services to the Company or interfere in any way with the right of the Company,
subject to the terms of any separate agreement to the contrary, at any time to
terminate such employment or service or to increase or decrease the compensation
of the Participant. No person shall have any claim or right to receive an Award
hereunder. The Committee's granting of an Award to a Participant at any time
shall neither require the Committee to grant any other Award to such Participant
or other person at any time nor preclude the Committee from making subsequent
grants to such Participant or any other person.

16. Securities Matters.

(a) Notwithstanding anything herein to the contrary, the Company shall not be
obligated to cause to be issued or delivered any certificates evidencing shares
of Company Stock pursuant to the Plan unless and until the Company is advised by
its counsel that the issuance and delivery of such certificates is in compliance
with all applicable laws, regulations of governmental authority and the
requirements of any securities exchange on which shares of Company Stock are
traded. The Committee may require, as a condition of the issuance and delivery
of certificates evidencing shares of Company Stock pursuant to the terms hereof,
that the recipient of such shares make such agreements and representations, and
that such certificates bear such legends, as the Committee, in its sole
discretion, deems necessary or advisable.

(b) The transfer of any shares of Company Stock hereunder shall be effective
only at such time as counsel to the Company shall have determined that the
issuance and delivery


                                 11





of such shares is in compliance with all applicable laws, regulations of
governmental authority and the requirements of any securities exchange on which
shares of Company Stock are traded. The Committee may, in its sole discretion,
defer the effectiveness of any transfer of shares of Company Stock hereunder in
order to allow the issuance of such shares to be made pursuant to registration
or an exemption from registration or other methods for compliance available
under federal or state securities laws. The Committee shall inform the
Participant in writing of its decision to defer the effectiveness of a transfer.
During the period of such deferral in connection with the exercise of an Option,
the Participant may, by written notice, withdraw such exercise and obtain the
refund of any amount paid with respect thereto.

17. Withholding Taxes.

Whenever cash is to be paid pursuant to an Award, the Company shall have the
right to deduct therefrom an amount sufficient to satisfy any federal, state and
local withholding tax requirements related thereto. Whenever shares of Company
Stock are to be delivered pursuant to an Award, the Company shall have the right
to require the Participant to remit to the Company in cash an amount sufficient
to satisfy any federal, state and local withholding tax requirements related
thereto. With the approval of the Committee, a Participant may satisfy the
foregoing requirement by electing to have the Company withhold from delivery
shares of Company Stock having a value equal to the minimum amount of tax
required to be withheld. Such shares shall be valued at their Fair Market Value
on the date of which the amount of tax to be withheld is determined. Fractional
share amounts shall be settled in cash. Such a withholding election may be made
with respect to all or any portion of the shares to be delivered pursuant to an
Award.

18. Notification of Election Under Section 83(b) of the Code.

If any Participant shall, in connection with the acquisition of shares of
Company Stock under the Plan, make the election permitted under Section 83(b) of
the Code, such Participant shall notify the Company of such election within 10
days of filing notice of the election with the Internal Revenue Service.

19. Notification Upon Disqualifying Disposition Under Section 421(b) of the
Code.

Each Agreement with respect to an Incentive Stock Option shall require the
Participant to notify the Company of any disposition of shares of Company Stock
issued pursuant to the exercise of such Option under the circumstances described
in Section 421(b) of the Code (relating to certain disqualifying dispositions),
within 10 days of such disposition.

20. Amendment or Termination of the Plan.

The Board of Directors may, at any time, suspend or terminate the Plan or revise
or amend it in any respect whatsoever; provided, however, that shareholder
approval shall be required for any such amendment if and to the extent such
approval is required in order to comply with applicable law or stock exchange
listing requirement. Nothing herein shall restrict the Committee's ability to
exercise its discretionary authority pursuant to Sections 3 and 4, which
discretion may be exercised without amendment to the Plan. No action hereunder
may, without the consent of a Participant, reduce the Participant's rights under
any outstanding Award.



                                  12





21. Transfers Upon Death.

Upon the death of a Participant, outstanding Awards granted to such Participant
may be exercised only by the executor or administrator of the Participant's
estate or by a person who shall have acquired the right to such exercise by will
or by the laws of descent and distribution. No transfer of an Award by will or
the laws of descent and distribution shall be effective to bind the Company
unless the Committee shall have been furnished with (a) written notice thereof
and with a copy of the will and/or such evidence as the Committee may deem
necessary to establish the validity of the transfer and (b) an agreement by the
transferee to comply with all the terms and conditions of the Award that are or
would have been applicable to the Participant and to be bound by the
acknowledgments made by the Participant in connection with the grant of the
Award.

22. Expenses and Receipts.

The expenses of the Plan shall be paid by the Company. Any proceeds received by
the Company in connection with any Award may be used for general corporate
purposes.

23. Effective Date and Term of Plan.

The Plan shall be subject to the requisite approval of the shareholders of the
Company. In the absence of such approval, any Awards shall be null and void.
Unless earlier terminated by the Board of Directors, the right to grant Awards
under the Plan shall terminate on the tenth anniversary of the Effective Date.
Awards outstanding at Plan termination shall remain in effect according to their
terms and the provisions of the Plan.

24. Applicable Law.

Except to the extent preempted by any applicable federal law, the Plan shall be
construed and administered in accordance with the laws of the State of Delaware
without reference to its principles of conflicts of law.

25. Participant Rights.

No Participant shall have any claim to be granted any award under the Plan, and
there is no obligation for uniformity of treatment for Participants.

26. Unfunded Status of Awards.

The Plan is intended to constitute an "unfunded" plan for incentive and deferred
compensation. With respect to any payments not yet made to a Participant
pursuant to an Award, nothing contained in the Plan or any Agreement shall give
any such Participant any rights that are greater than those of a general
creditor of the Company.

27. No Fractional Shares.

No fractional shares of Company Stock shall be issued or delivered pursuant to
the Plan. The Committee shall determine whether cash, other Awards, or other
property shall be issued or paid in lieu of such fractional shares or whether
such fractional shares or any rights thereto shall be forfeited or otherwise
eliminated.


                                  13






28. Beneficiary.

A Participant may file with the Committee a written designation of a beneficiary
on such form as may be prescribed by the Committee and may, from time to time,
amend or revoke such designation. If no designated beneficiary survives the
Participant, the executor or administrator of the Participant's estate shall be
deemed to be the Participant's beneficiary.

29. Severability.

If any provision of the Plan is held to be invalid or unenforceable, the other
provisions of the Plan shall not be affected but shall be applied as if the
invalid or unenforceable provision had not been included in the Plan.