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                                                                    EXHIBIT 99.1

                        CHILDTIME LEARNING CENTERS, INC.
                         2003 EQUITY COMPENSATION PLAN

     1.  Definitions:  As used herein, the following definitions shall apply:

          (a) "Award" shall mean any stock option, stock appreciation right,
     restricted stock, restricted stock unit, performance share award or other
     stock-based award granted under the Plan.

          (b) "Committee" shall mean a committee consisting of two or more
     members of the Board of Directors of the Corporation, each of whom (1)
     shall be an "outside director" as defined under Section 162(m) of the
     Internal Revenue Code of 1986, as amended (the "CODE"), and the Treasury
     Regulations thereunder, and (2) may be a "non-employee director" as defined
     under Rule 16b-3 of the Rules and Regulations under the Securities Exchange
     Act of 1934, as amended, or any similar or successor provision, as
     appointed by the Board of Directors of the Corporation to administer the
     Plan.

          (c) "Corporation" shall mean Childtime Learning Centers, Inc., a
     Michigan corporation, or any successor thereof.

          (d) "Discretion" shall mean in the sole discretion of the Committee,
     with no requirement whatsoever that the Committee follow past practices,
     act in a manner consistent with past practices, or treat a Participant (as
     hereinafter defined) in a manner consistent with the treatment afforded
     other Participants with respect to the Plan.

          (e) "Incentive Option" shall mean an option to purchase Common Stock
     of the Corporation which meets the requirements set forth in the Plan and
     also meets the definition of an incentive stock option set forth in Section
     422 of the Code.

          (f) "Nonqualified Option" shall mean an option to purchase Common
     Stock of the Corporation which meets the requirements set forth in the Plan
     but does not meet the definition of an incentive stock option set forth in
     Section 422 of the Code.

          (g) "Other stock-based award" shall mean any right granted under
     Paragraph 20 of the Plan.

          (h) "Participant" shall mean any individual or class of individual
     designated by the Committee under Paragraph 6 for participation in the Plan
     who is or becomes (i) a key employee (including an officer or director who
     is also a key employee) of the Corporation or any Subsidiary, (ii) a
     director who is not an employee of the Corporation or any Subsidiary
     (hereinafter sometimes referred to as an "outside director"), and (iii) a
     consultant or advisor of the Corporation or any Subsidiary.

          (i) "Performance share" shall mean a grant of Common Stock of the
     Corporation upon the attainment of one or more performance goals during a
     performance period established by the Committee, as provided in Paragraph
     19.

          (j) "Plan" shall mean this Childtime Learning Centers, Inc. 2003
     Equity Compensation Plan.

          (k) "Restricted stock" shall mean a grant of Common Stock of the
     Corporation which is subject to restrictions against transfer, forfeiture
     and such other terms and conditions determined by the Committee, as
     provided in Paragraph 18.

          (l) "Restricted stock unit" shall mean a grant of a right to obtain
     the value of a share of Common Stock of the Corporation which is subject to
     restrictions against transfer, forfeiture and such other terms and
     conditions determined by the Committee, as provided in Paragraph 18.

          (m) "Stock appreciation right" shall mean a right to receive the
     appreciation in value, or a portion of the appreciation in value, of a
     specified number of shares of the Common Stock of the Corporation, as
     provided in Paragraph 12.

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          (n) "Subsidiary" shall mean any corporation, limited liability
     company, partnership or any other entity in which the Corporation owns,
     directly or indirectly, stock or other ownership interest therein,
     possessing more than twenty-five percent (25%) of the combined voting power
     of all classes of stock or other ownership interest.

     2.  Purpose of Plan:  The purpose of the Plan is to provide key employees
(including officers and directors who are also key employees), outside
directors, consultants and advisors of the Corporation and its Subsidiaries with
incentives to make significant and extraordinary contributions to the long-term
performance and growth of the Corporation and its Subsidiaries, to join the
interests of key employees, outside directors, consultants and advisors with the
interests of the shareholders of the Corporation, and to facilitate attracting
and retaining key employees, outside directors, consultants and advisors with
exceptional abilities.

     3.  Administration:  The Plan shall be administered by the Committee.
Subject to the provisions of the Plan, the Committee shall determine, from those
who are or become eligible to be Participants under the Plan, the persons or
class of persons to be granted Awards, the type of Awards and the amount or
maximum amount of stock or rights covered by Awards to be granted to each such
person or class of person, and the terms and conditions of any Awards. Subject
to the provisions of the Plan, the Committee is authorized to interpret the
Plan, to promulgate, amend and rescind rules and regulations relating to the
Plan and to make all other determinations necessary or advisable for its
administration. Interpretation and construction of any provision of the Plan by
the Committee shall, unless otherwise determined by the Board of Directors of
the Corporation, be final and conclusive. A majority of the Committee shall
constitute a quorum, and the acts approved by a majority of the members present
at any meeting at which a quorum is present, or acts approved in writing by a
majority of the Committee, shall be the acts of the Committee.

     4.  Indemnification of Committee Members:  In addition to such other rights
of indemnification as they may have, the members of the Committee shall be
indemnified by the Corporation against the reasonable expenses, including
attorneys' fees, actually and necessarily incurred in connection with the
defense of any action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan or any Award
granted hereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by the Board of Directors of the
Corporation) or paid by them in satisfaction of a judgment in any such action,
suit or proceeding, except in relation to matters as to which it shall be
determined in such action, suit or proceeding that such Committee member has
acted in bad faith; provided, however, that within sixty (60) days after receipt
of notice of institution of any such action, suit or proceeding, a Committee
member shall offer the Corporation in writing the opportunity, at its own cost,
to handle and defend the same.

     5.  Maximum Number of Shares Subject to Plan:  The maximum number of shares
of stock which may be issued pursuant to Awards granted under the Plan or with
respect to which Awards may be granted under the Plan shall not exceed in the
aggregate 1,500,000 shares of Common Stock of the Corporation (subject to
adjustments as provided in this Paragraph 5). Any shares that are delivered by
the Corporation, and any awards or grants that are made by, or become
obligations of, the Corporation through the assumption by the Corporation or a
Subsidiary of, or in substitution for, outstanding awards or grants previously
made by an acquired company, shall not be counted against the number of shares
available under the Plan. Consistent with the purpose of the Plan and with a
view to avoiding over or under counting, the Committee shall, in its Discretion,
determine the number of shares to charge against the shares remaining available
under the Plan as a result of the grant or settlement of Awards made under the
Plan. If any shares covered by an Award or to which an Award relates are
forfeited, or if an Award otherwise terminates without the delivery of shares or
of other consideration, then the shares covered by such Award, or to which such
Award relates, or the number of shares otherwise counted against the aggregate
number of shares available under the Plan with respect to such Award, to the
extent of any such forfeiture or termination, shall again be, or shall become,
available for granting Awards under the Plan.

     The maximum number of shares with respect to which Awards may be granted to
any Participant during the term of the Plan shall not exceed 1,500,000 shares of
Common Stock of the Corporation (subject to adjustments as provided in this
Paragraph 5). All shares with respect to which an Award is granted shall be

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counted for purposes of this per-person share limitation, regardless of whether
the Participant did not realize the benefit of the Award as a result of
forfeiture, cancellation, expiration, termination or other event. If a stock
option or a stock appreciation right is modified after grant to reduce its
exercise price or grant value, the modified stock option or stock appreciation
right shall be treated as a newly granted stock option or stock appreciation
right for purposes of this per-person share limitation, with the shares covered
by both the original and the modified grant counting against the number of
available shares under this per-person limitation.

     The number of shares with respect to each outstanding Award, the option
price with respect to outstanding stock options, the grant value with respect to
outstanding stock appreciation rights, the aggregate number of shares available
at any time under the Plan, and the maximum number of shares with respect to
which Awards may be made to an individual Participant during the term of the
Plan shall be subject to such adjustment as the Committee, in its Discretion,
deems appropriate to reflect such events as stock dividends, stock splits,
recapitalizations, mergers, consolidations or reorganizations of or by the
Corporation; provided, however, that no fractional shares shall be issued
pursuant to the Plan, no Awards may be granted under the Plan with respect to
fractional shares, and any fractional shares resulting from such adjustments
shall be eliminated from any outstanding Award.

     6.  Participants:  The Committee shall determine and designate from time to
time, in its Discretion, those individuals who are or who become key employees
(including officers and directors who are also key employees), outside
directors, consultants or advisors of the Corporation or any Subsidiary to
receive Awards who, in the judgment of the Committee, are or will become
responsible for the direction and financial success of the Corporation or any
Subsidiary. Subject to the provisions of the Plan, the Committee may authorize
in advance the grant of Awards to individuals or classes of individuals who are
not at the time of Committee authorization, but who subsequently become, key
employees, outside directors, consultants or advisors of the Corporation or any
Subsidiary; provided, however, that (i) for all purposes of the Plan, the date
of grant of any Award made to an individual pursuant to such authorization shall
be no earlier than the date on which such individual becomes an employee,
outside director, consultant or advisor of the Corporation or any Subsidiary,
and (ii) such authorization shall prescribe the principal terms or range of
terms of the Awards that may be made to such individuals or classes of
individuals including, without limitation, the type or types of Awards and the
number or maximum number of shares to be covered by such Awards.

     7.  Written Agreement:  Each Award granted under the Plan shall be
evidenced by a written agreement between the Corporation and the Participant
which shall contain such provisions as may be approved by the Committee. Such
agreements shall constitute binding contracts between the Corporation and the
Participant, and every Participant, upon acceptance of such agreement, shall be
bound by the terms and restrictions of the Plan and of such agreement. The terms
of each such agreement shall be in accordance with the Plan, but the agreements
may include such additional provisions and restrictions determined by the
Committee, provided that such additional provisions and restrictions do not
violate the terms of the Plan.

     8.  Allotment of Shares:  Subject to the terms of the Plan, the Committee
shall determine and fix, in its Discretion, the number or maximum number of
shares with respect to which each Participant may be granted Awards; provided,
however, that no Incentive Option may be granted under the Plan to any one
Participant which would result in the aggregate fair market value, determined as
of the date the option is granted, of underlying stock with respect to which
Incentive Options are exercisable for the first time by such Participant during
any calendar year under any plan maintained by the Corporation (or any parent or
Subsidiary of the Corporation) exceeding $100,000.

     9.  Stock Options:  Subject to the terms of the Plan, the Committee, in its
Discretion, may grant to Participants either Incentive Options, Nonqualified
Options or any combination thereof; provided, however, that an Incentive Option
may only be granted to an employee of the Corporation or a Subsidiary, and in
the case of a Subsidiary only if (i) the Subsidiary is treated as a disregarded
entity owned by the Corporation, or (ii) the Subsidiary is a corporation (or is
treated as a disregarded entity owned by a corporation) fifty percent or more of
the combined voting power of all classes of stock of which is owned, directly or
indirectly, by the Corporation. Each option granted under the Plan shall
designate the number of shares covered thereby, if any,

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with respect to which the option is an Incentive Option, and the number of
shares covered thereby, if any, with respect to which the option is a
Nonqualified Option.

     10.  Stock Option Price:  Subject to the rules set forth in this Paragraph
10, the Committee, in its Discretion, shall establish the price per share for
which the shares covered by the option may be purchased. With respect to an
Incentive Option, such option price shall not be less than 100% of the fair
market value of the stock on the date on which such option is granted; provided,
however, that with respect to an Incentive Option granted to a Participant who
at the time of the grant owns (after applying the attribution rules of Section
424(d) of the Code) more than 10% of the total combined voting stock of the
Corporation or of any parent or Subsidiary, the option price shall not be less
than 110% of the fair market value of the stock on the date such option is
granted. With respect to a Nonqualified Option, the option price shall not be
less than 50% of the fair market value of the stock on the date such option is
granted. Fair market value of a share shall be determined by the Committee and
may be determined by taking the mean between the highest and lowest quoted
selling prices of the Corporation's stock on any exchange or other market on
which the shares of Common Stock of the Corporation shall be traded on such date
or, if there are no sales on such date, on the next preceding or following day
on which there are sales. The option price shall be subject to adjustment in
accordance with the provisions of Paragraph 5 of the Plan.

     11.  Payment of Stock Option Price:  At the time of the exercise in whole
or in part of any stock option granted hereunder, payment of the option price in
full in cash or, with the consent of the Committee, in Common Stock of the
Corporation or by a promissory note payable to the order of the Corporation
which is acceptable to the Committee, shall be made by the Participant for all
shares so purchased. Such payment may, with the consent of the Committee, also
consist of a cash down payment and delivery of such a promissory note in the
amount of the unpaid exercise price. In the Discretion of, and subject to such
conditions as may be established by, the Committee, payment of the option price
may also be made by the Corporation retaining from the shares to be delivered
upon exercise of the stock option that number of shares having a fair market
value on the date of exercise equal to the option price of the number of shares
with respect to which the Participant exercises the option. In the Discretion of
the Committee, a Participant may exercise an option, if then exercisable, in
whole or in part, by delivery to the Corporation of written notice of the
exercise in such form as the Committee may prescribe, accompanied by irrevocable
instructions to a stock broker to promptly deliver to the Corporation full
payment for the shares with respect to which the option is exercised from the
proceeds of the stock broker's sale of or loan against some or all of the shares
(a "Regulation T Stock Option Exercise"). In the event the Corporation then has
in effect a stock repurchase program, in its Discretion and subject to such
terms and conditions as it may impose, the Committee may permit a Participant to
exercise an option and pay the option price by delivering to the Corporation a
written notice of exercise which includes a request that the Corporation
repurchase (and retain the repurchase price of) that number of the option shares
having a fair market value on the date of exercise equal to the option price of
the number of shares with respect to which the Participant exercises the option.
Such payment may also be made in such other manner as the Committee determines
is appropriate, in its Discretion. No Participant shall have any of the rights
of a shareholder of the Corporation under any stock option until the actual
issuance of shares to said Participant, and prior to such issuance no adjustment
shall be made for dividends, distributions or other rights in respect of such
shares, except as provided in Paragraph 5.

     12.  Stock Appreciation Rights:  Subject to the terms of the Plan, the
Committee may grant stock appreciation rights to Participants either in
conjunction with, or independently of, any stock options granted under the Plan.
A stock appreciation right granted in conjunction with a stock option may be an
alternative right wherein the exercise of the stock option terminates the stock
appreciation right to the extent of the number of shares purchased upon exercise
of the stock option and, correspondingly, the exercise of the stock appreciation
right terminates the stock option to the extent of the number of shares with
respect to which the stock appreciation right is exercised. Alternatively, a
stock appreciation right granted in conjunction with a stock option may be an
additional right wherein both the stock appreciation right and the stock option
may be exercised. A stock appreciation right may not be granted in conjunction
with an Incentive Option under

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circumstances in which the exercise of the stock appreciation right affects the
right to exercise the Incentive Option or vice versa, unless the stock
appreciation right, by its terms, meets all of the following requirements:

          (a) the stock appreciation right will expire no later than the
     Incentive Option;

          (b) the stock appreciation right may be for no more than the
     difference between the option price of the Incentive Option and the fair
     market value of the shares subject to the Incentive Option at the time the
     stock appreciation right is exercised;

          (c) the stock appreciation right is transferable only when the
     Incentive Option is transferable, and under the same conditions;

          (d) the stock appreciation right may be exercised only when the
     Incentive Option is eligible to be exercised; and

          (e) the stock appreciation right may be exercised only when the fair
     market value of the shares subject to the Incentive Option exceeds the
     option price of the Incentive Option.

     Upon exercise of a stock appreciation right, a Participant shall be
entitled to receive, without payment to the Corporation (except for applicable
withholding taxes), an amount equal to the excess of or, in the Discretion of
the Committee, a portion of the excess of (i) the then aggregate fair market
value of the number of shares with respect to which the Participant exercises
the stock appreciation right, over (ii) the aggregate fair market value of such
number of shares at the time the stock appreciation right was granted. This
amount shall be payable by the Corporation, in the Discretion of the Committee,
in cash, in shares of Common Stock of the Corporation, in other property or any
combination thereof.

     13.  Granting and Exercise of Stock Options and Stock Appreciation
Rights:  Subject to the provisions of this Paragraph 13, each stock option and
stock appreciation right granted hereunder shall be exercisable at any such time
or times or in any such installments as may be determined by the Committee;
provided, however, that the aggregate fair market value (determined at the time
the option is granted) of the stock with respect to which Incentive Options are
exercisable for the first time by a Participant during any calendar year shall
not exceed $100,000. A Participant may exercise a stock option or stock
appreciation right, if then exercisable, in whole or in part, by delivery to the
Corporation of written notice of the exercise, in such form as the Committee may
prescribe, accompanied, in the case of a stock option, by payment for the shares
with respect to which the stock option is exercised as provided in Paragraph 12
(unless the Committee, in its Discretion, permits a cashless form of option
exercise permitted by Paragraph 12). Except as provided in Paragraph 17, stock
options and stock appreciation rights may be exercised only while the
Participant is an employee, outside director, consultant or advisor, as the case
may be, of the Corporation or a Subsidiary. Successive stock options and stock
appreciation rights may be granted to the same Participant, whether or not the
stock option(s) and stock appreciation right(s) previously granted to such
Participant remain unexercised. A Participant may exercise a stock option or
stock appreciation right, if then exercisable, notwithstanding that stock
options and stock appreciation rights previously granted to such Participant
remain unexercised.

     14.  Non-transferability of Stock Options and Stock Appreciation
Rights:  No stock option or stock appreciation right granted under the Plan to a
Participant shall be transferable by such Participant otherwise than by will, or
by the laws of descent and distribution, and stock options and stock
appreciation rights shall be exercisable, during the lifetime of the
Participant, only by the Participant. Notwithstanding the foregoing, in its
Discretion and subject to such terms and conditions as it may prescribe, the
Committee may permit a Participant to transfer a Nonqualified Option or a
related or independently granted stock appreciation right.

     15.  Term of Stock Options and Stock Appreciation Rights:  If not sooner
terminated, each stock option and stock appreciation right granted hereunder
shall expire not more than ten (10) years from the date of the granting thereof;
provided, however, that with respect to an Incentive Option granted to a
Participant who, at the time of the grant, owns (after applying the attribution
rules of Section 424(d) of the Code) more than 10% of the total combined voting
stock of all classes of stock of the Corporation or any parent or Subsidiary,
such option shall expire not more than five (5) years after the date of granting
thereof.

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     16.  Continuation of Employment:  The Committee may require, in its
Discretion, that any Participant under the Plan to whom a stock option or a
stock appreciation right shall be granted shall agree in writing as a condition
of the granting of such stock option or stock appreciation right to remain an
employee, consultant, advisor or outside director of the Corporation or a
Subsidiary, as the case may be, for a designated minimum period from the date of
the granting of such stock option or stock appreciation right as shall be fixed
by the Committee, and the Committee may further require, in its Discretion, that
any Participant agree in writing to comply with any confidentiality,
non-solicitation, non-competition and non-disparagement provisions and covenants
that the Committee may require as a condition precedent to the exercise of a
stock option or a stock appreciation right.

     17.  Termination of Employment:  If the employment of an employee
Participant terminates, if the consultancy or advisorship of a consultant or
advisor Participant terminates, or if an outside director Participant ceases to
be a director (hereinafter collectively referred to as a "termination of
employment"), the Committee may, in its Discretion, permit the exercise of stock
options and stock appreciation rights granted to such Participant (a) for a
period not to exceed three months following such termination of employment (or
one year following termination of employment on account of the Participant's
death or permanent disability) with respect to Incentive Options or related
stock appreciation rights, and (b) for a period not to extend beyond the
expiration date with respect to Nonqualified Options or related or independently
granted stock appreciation rights. In no event, however, shall a stock option or
a stock appreciation right be exercisable subsequent to its expiration date. A
stock option or stock appreciation right may only be exercised after a
Participant's termination of employment to the extent exercisable on the date of
termination of employment; provided, however, that if the termination of
employment is due to the Participant's death, permanent disability or retirement
at a retirement age permitted under the Corporation's or Subsidiary's retirement
plan or policies, or if the termination of employment results from action by the
Corporation or a Subsidiary without cause or from an agreement between the
Corporation or a Subsidiary and the Participant (hereinafter collectively
referred to as a "qualifying termination of employment"), the Committee, in its
Discretion, may permit all or part of the stock options and stock appreciation
rights granted to such Participant to thereupon become exercisable in full or in
part. For purposes of this Paragraph 17 and any other provision of the Plan
where the term is used, the Committee's definition of "cause" shall be final and
conclusive.

     18.  Restricted Stock or Restricted Stock Units:  Subject to the terms of
the Plan, the Committee may award Participants shares of restricted stock and/or
the Committee may grant Participants restricted units with respect to a
specified number of shares of stock. All shares of restricted stock and all
restricted stock units granted to Participants under the Plan shall be subject
to the following terms and conditions (and to such other terms and conditions
prescribed by the Committee):

          (a) At the time of each award of restricted shares or restricted stock
     units, there shall be established for the shares or units a restricted
     period, which period may differ among Participants and may have different
     expiration dates with respect to portions of shares or units covered by the
     same award.

          (b) Shares of restricted stock or restricted stock units awarded to
     Participants may not be sold, assigned, transferred, pledged, hypothecated
     or otherwise encumbered during the restricted period applicable to such
     shares or units. Except for such restrictions on transfer, a Participant
     may be provided all of the rights of a shareholder in respect of restricted
     shares including, but not limited to, the right to receive dividends on,
     and the right to vote, the shares. A Participant shall have no ownership
     interest in shares of stock with respect to which restricted stock units
     are granted; provided, however, that the Committee may, in its Discretion,
     permit payment to such Participant of dividend equivalents on such units
     equal to the amount of dividends, if any, which are paid on that number of
     shares with respect to which the restricted stock units are granted.

          (c) If there is a termination of employment of a Participant, all
     shares or units theretofore awarded to the Participant which are still
     subject to the restrictions imposed by Paragraph 18(b) shall upon such
     termination of employment be forfeited and transferred back to the
     Corporation, without payment of any consideration by the Corporation;
     provided, however, that in the event of a qualifying termination of

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     employment, the Committee may, in its Discretion, release some or all of
     the shares or units from the restrictions.

          (d) Shares of restricted stock granted under the Plan may be evidenced
     in such manner as the Committee may deem appropriate, including, without
     limitation, book-entry registration or issuance of stock certificates. If
     stock certificates are issued in respect of shares of restricted stock,
     such certificates shall be registered in the name of the Participant,
     deposited with the Corporation or its designee, together with a stock power
     endorsed in blank, and, in the Discretion of the Committee, a legend shall
     be placed upon such certificates reflecting that the shares represented
     thereby are subject to restrictions against transfer and forfeiture.

          (e) At the expiration of the restricted period applicable to
     restricted shares, the Corporation shall deliver to the Participant or the
     legal representative of the Participant's estate stock certificates for
     such shares. If stock certificates were previously issued for the shares
     and a legend has been placed on such certificates, the Corporation shall
     cause such certificates to be reissued without the legend.

          (f) At the expiration of the restricted period applicable to
     restricted stock units, the Corporation shall pay to the Participant an
     amount equal to the then fair market value of the shares. In the Discretion
     of the Committee, such amount may be paid in cash, stock, other property or
     any combination thereof. Moreover, in the Discretion of the Committee, such
     amount may be paid in a lump sum or in installments, currently upon
     expiration of the restricted period or on a deferred basis, with provision
     for the payment or crediting of a dividend equivalent or reasonable rate of
     interest on installment or deferred payments in the Discretion of the
     Committee.

In the case of events such as stock dividends, stock splits, recapitalizations,
mergers, consolidations or reorganizations of or by the Corporation, any stock,
securities or other property which a Participant receives or is entitled to
receive by reason of his ownership of restricted shares shall, unless otherwise
determined by the Committee, be subject to the same restrictions applicable to
the restricted shares.

     19.  Performance Shares:  The Committee may grant to a Participant the
right to obtain performance shares subject to the following terms and
conditions:

          (a) The Participant's right to obtain performance shares shall be
     subject to attainment of one or more performance goals over a performance
     period prescribed by the Committee.

          (b) The performance goal applicable to an award to a Participant of
     the right to obtain performance shares shall be based upon free cash flow,
     cash flow return on investment, stock price, market share, sales, revenues,
     earnings per share, return on equity, total stockholder return, costs, net
     income, working capital turnover, inventory or receivable turnover and/or
     margins of the Corporation, a Subsidiary, or a division or unit thereof.
     The specific targets and other details of the performance goal shall be
     established by the Committee in its Discretion. A performance goal must,
     however, be objective so that a third party with knowledge of the relevant
     facts could determine whether the goal has been attained.

          (c) The performance goal applicable to an award to a Participant of
     the right to obtain performance shares shall be established by the
     Committee in writing at any time during the period beginning on the date of
     the award and ending on the earlier of (i) ninety (90) days after
     commencement of the performance period applicable to the award, or (ii)
     expiration of the first 25% of the performance period; provided, however,
     that there must be substantial uncertainty whether a performance goal will
     be attained at the time it is established by the Committee.

          (d) The performance goal established by the Committee must prescribe
     an objective formula or standard, that could be applied by a third party
     having knowledge of the relevant performance results, to compute the number
     of performance shares issuable to the Participant if the goal is attained.

          (e) Unless otherwise determined by the Committee in the case of a
     Participant who dies or becomes permanently disabled, performance shares
     shall be issued to a Participant only after (i) expiration of the
     performance period and attainment of the performance goal applicable to the
     award, and (ii) issuance of a written certification by the Committee
     (including approved minutes of the meeting
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     of the Committee at which the certification is made) that the performance
     goal and any other material terms of the award have been attained or
     satisfied.

          (f) No Participant shall have any of the rights of a shareholder of
     the Corporation in respect of the shares covered by a performance share
     award until the actual issuance of the shares to said Participant and,
     prior to such issuance, no adjustments shall be made for dividends,
     distributions or other rights in respect of such shares, except as provided
     in Paragraph 5.

          (g) In its Discretion and subject to such terms and conditions as it
     may impose, the Committee may permit a Participant to elect to defer
     receipt of performance shares to a time later than the time the shares
     otherwise would be issued to the Participant. In such event, the Committee
     may, in its Discretion, provide for the payment by the Corporation of an
     additional amount representing interest at a reasonable rate or the actual
     rate of return on one or more predetermined specific investments, as
     determined by the Committee.

          (h) In the Discretion of the Committee, in lieu of settling a
     performance share award by issuance of shares of Common Stock of the
     Corporation to a Participant, all or a portion of the award may be settled
     by payment of cash or other property to the Participant in an amount or
     having a value equal to the then value of the otherwise issuable shares;
     provided, however, that the amount of cash and the value of any other
     property paid to any Participant during any calendar year in settlement of
     a performance share award shall not exceed $1,000,000.

          (i) Unless otherwise determined by the Committee, performance shares
     or rights therein awarded to a Participant may not be sold, assigned,
     transferred, pledged, hypothecated or otherwise encumbered by the
     Participant at any time before actual issuance of the shares to the
     Participant.

          (j) In its Discretion, the Committee may subject a performance share
     award to a Participant to any other terms or conditions not inconsistent
     with the foregoing, including, without limitation, a requirement that the
     Participant remain an employee of the Corporation or a Subsidiary
     (including at or above a specified salary grade), or that the Participant
     remain a consultant, advisor or outside director of the Corporation or a
     Subsidiary, for the entire performance period applicable to the award.

     Performance share awards under the Plan are intended to constitute
qualified performance-based compensation for purposes of Section 162(m)(4)(C) of
the Code and the Treasury Regulations thereunder, and the provisions of this
Paragraph 19 (and the other provisions of the Plan relating to performance share
awards) shall be interpreted and administered to effectuate that intent.
Moreover, the Committee may revise or modify the requirements of this Paragraph
19 or the terms of outstanding performance share awards to the extent the
Committee determines, in its Discretion, that such revision or modification is
necessary for such awards to constitute qualified performance-based
compensation.

     20.  Other Stock-Based Awards:  The Committee may grant to Participants
such other awards that are denominated or payable in, valued in whole or in part
by reference to, or otherwise based on or related to, shares of Common Stock of
the Corporation as are deemed by the Committee, in its Discretion, to be
consistent with the purposes of the Plan; provided, however, that such grants
must comply with applicable law. Without limitation, the Committee may permit a
Participant to make a current, outright purchase of shares of Common Stock of
the Corporation, which shares may or may not be subject to any restrictions or
conditions, for a price equal to, less than or greater than the then fair market
value of the shares, with the price payable by the Participant in such form and
manner and at such time as determined by the Committee in its Discretion.

     21.  Investment purpose:  If the Committee, in its Discretion, determines
that as a matter of law such procedure is or may be desirable, it may require a
Participant, upon any acquisition of stock hereunder and as a condition to the
Corporation's obligation to deliver certificates representing such shares, to
execute and deliver to the Corporation a written statement in form satisfactory
to the Committee, representing and warranting that the Participant's acquisition
of shares of stock shall be for such person's own account, for investment and
not with a view to the resale or distribution thereof and that any subsequent
offer for sale or sale of any such shares shall be made either pursuant to (a) a
Registration Statement on an appropriate form under the Securities Act of 1933,
as amended (the "Securities Act"), which Registration Statement has
<PAGE>

become effective and is current with respect to the shares being offered and
sold, or (b) a specific exemption from the registration requirements of the
Securities Act, but in claiming such exemption the Participant shall, prior to
any offer for sale or sale of such shares, obtain a favorable written opinion
from counsel for or approved by the Corporation as to the availability of such
exemption. The Corporation may endorse an appropriate legend referring to the
foregoing restriction upon the certificate or certificates representing any
shares issued or transferred to the Participant under the Plan.

     22.  Rights to Continued Employment:  Nothing contained in the Plan or in
any Award granted pursuant to the Plan, nor any action taken by the Committee
hereunder, shall confer upon any Participant any right with respect to
continuation of employment or service as an employee, consultant, advisor or
outside director of the Corporation or a Subsidiary nor interfere in any way
with the right of the Corporation or a Subsidiary to terminate such person's
employment or service at any time with or without cause.

     23.  Withholding Payments:  If, upon the grant, exercise, release of
restrictions or settlement of or in respect of an Award, or upon any other event
or transaction under or relating to the Plan, there shall be payable by the
Corporation or a Subsidiary any amount for income or employment tax withholding,
in the Committee's Discretion, either the Corporation shall appropriately reduce
the amount of stock, cash or other property to be paid to the Participant or the
Participant shall pay such amount to the Corporation or Subsidiary to enable it
to pay or to reimburse it for paying such income or employment tax withholding.
The Committee may, in its Discretion, permit Participants to satisfy such
withholding obligations, in whole or in part, by electing to have the amount of
Common Stock delivered or deliverable by the Corporation in respect of an Award
appropriately reduced, or by electing to tender Common Stock back to the
Corporation subsequent to receipt of such stock in respect of an Award. The
Corporation or any of its Subsidiaries shall also have the right to withhold the
amount of such taxes from any other sums or property due or to become due from
the Corporation or any of its Subsidiaries to the Participant upon such terms
and conditions as the Committee shall prescribe. The Corporation may also defer
issuance of stock under the Plan until payment by the Participant to the
Corporation or any of its Subsidiaries of the amount of any such tax. In the
case of a Regulation T Stock Option Exercise, the Committee may in its
Discretion permit the Participant to irrevocably instruct a stock broker to
promptly deliver to the Corporation an amount (in addition to the option
exercise price) equal to any withholding tax owing in respect of such option
exercise from the proceeds of the stock broker's sale of or loan against some or
all of the shares. In the event the Corporation then has in effect a stock
repurchase program, in its discretion and subject to such terms and conditions
as it may impose, the Committee may permit Participants to satisfy their
withholding tax obligations by requesting that the Corporation repurchase (and
retain the repurchase price of) that number of shares issuable or issued under
the Plan having a then fair market value equal to the amount of withholding tax
due. The Committee may make such other arrangements with respect to income or
employment tax withholding as it shall determine.

     24.  Change in Control:  Notwithstanding any other provision of the Plan or
any provision of a grant or award agreement, in the event the Committee
determines that there has been or will be a change in control of the Corporation
or of any Subsidiary, the Committee may, without the consent of the holder,
provide for any treatment of outstanding Awards which it determines, in its
Discretion, to be appropriate. Such treatment may include, without limitation,
acceleration of vesting of stock options and stock appreciation rights, release
of restrictions applicable to restricted stock or restricted stock units, or
deeming performance share awards to have been earned. In determining whether
there has been or will be a change in control of the Corporation or of any
Subsidiary, the Committee may utilize a definition it deems appropriate of a
change in control, including any such definition contained in any existing
agreement between the Corporation or a Subsidiary and one of its senior
executives.

     25.  Effectiveness of Plan:  The Plan shall be effective on the date the
Board of Directors of the Corporation adopts the Plan, provided that the
shareholders of the Corporation approve the Plan within twelve (12) months of
that date. Awards may be granted prior to shareholder approval of the Plan, but
each such Award shall be subject to shareholder approval of the Plan. Without
limitation, no stock option or stock appreciation right may be exercised and no
performance or other shares may be issued prior to shareholder approval, and any
restricted stock or restricted stock units awarded are subject to forfeiture if
such shareholder approval is not obtained.
<PAGE>

     26.  Termination, Duration and Amendments of Plan:  The Plan may be
abandoned or terminated at any time by the Board of Directors of the
Corporation. Unless sooner terminated by the Board of Directors, the Plan shall
terminate on the date ten (10) years after its adoption by the Board of
Directors, and no Awards may be granted thereafter. The termination of the Plan
shall not affect the validity of any Award outstanding on the date of
termination.

For the purpose of conforming to any changes in applicable law or governmental
regulations, or for any other lawful purpose, the Board of Directors of the
Corporation shall have the right, without approval of the shareholders of the
Corporation, to amend or revise the terms of the Plan at any time; provided,
however, that no such amendment or revision shall (i) with respect to the Plan,
increase the maximum number of shares in the aggregate which are subject to the
Plan or with respect to which Awards may be made to individual Participants
(subject, however, to the provisions of Paragraph 5), materially change the
class of persons eligible to be Participants under the Plan, establish
additional and different business criteria on which performance share goals are
based, or materially increase the benefits accruing to Participants under the
Plan, without approval or ratification of the shareholders of the Corporation;
or (ii) with respect to an Award previously granted under the Plan, except as
otherwise specifically provided in the Plan, alter or impair any such Award
without the consent of the holder thereof.


