PROGRESSIVE CORP/OH/
EX-10.V 2003 DIRECTOR'S EQUITY INCENTIVE PLAN
<DOCUMENT>
<TYPE>EX-10.V
<SEQUENCE>14
<FILENAME>l99510aexv10wv.txt
<DESCRIPTION>EX-10.V 2003 DIRECTOR'S EQUITY INCENTIVE PLAN
<TEXT>
<PAGE>
Exhibit No. 10(V)
                           THE PROGRESSIVE CORPORATION

                      2003 DIRECTORS EQUITY INCENTIVE PLAN

SECTION 1.  ESTABLISHMENT; PURPOSE; DEFINITIONS.

                        (a) The Progressive Corporation, an Ohio corporation
(the "Company"), hereby establishes an incentive compensation plan for Eligible
Directors, to be known as "The Progressive Corporation 2003 Directors Equity
Incentive Plan" (the "Plan"), as set forth in this document. The Plan permits
the grant of Restricted Stock and Stock Options to Eligible Directors of the
Company.

                        (b) The purpose of the Plan is to enable the Company to
attract, retain and reward directors of the Company and to strengthen the
mutuality of interests between such directors and the Company's shareholders by
offering such directors equity or equity-based incentives.

                        (c) For purposes of the Plan, the following terms shall
have the meanings set forth below:

                        "Award" means any award of Restricted Stock or Stock
Options under the Plan.

                        "Award Agreement" means an agreement setting forth the
            terms and conditions applicable to an Award granted to a Participant
            under the Plan.

                        "Board" means the Board of Directors of the Company.

                        "Book Value" means, as of any given date, on a per share
            basis (1) the shareholders' equity in the Company as of the end of
            the immediately preceding fiscal year as reflected in the Company's
            audited consolidated balance sheet as of such year-end date, subject
            to such adjustments as the Committee shall specify at or after
            grant, divided by (2) the number of outstanding shares of Stock as
            of such year-end date, subject to such adjustments as the Committee
            shall specify for events subsequent to such year-end date.

                        "Change in Control" has the meaning assigned to it in
            Section 7(b).

                        "Change in Control Price" has the meaning assigned to it
            in Section 7(d).

                        "Code" means the Internal Revenue Code of 1986, as
            amended from time to time, and any successor thereto.

                        "Committee" means the Compensation Committee of the
            Board.

                        "Company" means The Progressive Corporation, an Ohio
            corporation, or any successor corporation.

                        "Disability" means a mental or physical condition which,
            in the opinion of the Committee, renders a Participant unable or
            incompetent to carry out the responsibilities held by


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            such Participant as a Board member and which is expected to be
            permanent or for an indefinite duration.

                        "Eligible Directors" has the meaning assigned to it in
            Section 4.

                        "Exchange Act" means the Securities Exchange Act of
            1934, as amended.

                        "Expiration Date" means the date upon which an Award, or
            any portion thereof, is scheduled to expire or terminate if not
            exercised or vested prior thereto, as determined by the Committee.

                        "Fair Market Value" means, as of any given date, the
            mean between the highest and lowest quoted selling price of the
            Stock on such date on the New York Stock Exchange or, if no such
            sale of the Stock occurs on the New York Stock Exchange on such
            date, then such mean price on the next preceding day on which the
            Stock was traded. If the Stock is no longer traded on the New York
            Stock Exchange, then the Fair Market Value of the Stock shall be
            determined by the Committee in good faith.

                        "Family Member" means a Participant's child, stepchild,
            grandchild, parent, stepparent, grandparent, spouse, sibling, niece,
            nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
            brother-in-law or sister-in-law, including adoptive relationships, a
            trust in which any of these persons (and/or the Participant) holds
            more than 50% of the beneficial interest, a foundation in which any
            of these persons (and/or the Participant) controls the management of
            assets and any other entity in which any of these persons (and/or
            the Participant) owns more than 50% of the voting interests.

                        "Incentive Stock Option" means any Stock Option intended
            to be and designated as an "Incentive Stock Option", which satisfies
            the requirements of Section 422 of the Code or any successor section
            thereto.

                        "Non-Employee Director" shall have the meaning set forth
            in Rule 16b-3(b)(3)(i) promulgated by the Securities and Exchange
            Commission under the Exchange Act, or any successor definition
            adopted by the Commission.

                        "Non-Qualified Stock Option" means any Stock Option that
            is not an Incentive Stock Option.

                        "Option Exercise Price" means the price at which a share
            of Stock may be purchased by a Participant pursuant to the exercise
            of an Option, as determined by the Committee and set forth in the
            related Option Award Agreement.

                        "Option Term" has the meaning assigned to it in Section
            6(b)(2).

                        "Participant" means an Eligible Director who holds an
            outstanding Award granted under the Plan.

                        "Plan" means The Progressive Corporation 2003 Directors
            Equity Incentive Plan, as amended from time to time.

                        "Potential Change in Control" has the meaning assigned
            to it in Section 7(c).

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                        "Restricted Stock" means an Award of shares of Stock
            that is made pursuant to Section 5 and is subject to restrictions.

                        "Restriction Period" and "Minimum Restriction Period"
            shall have the meanings assigned to them in Section 5(b)(7).

                        "Stock" means the Common Shares, $1.00 par value per
            share, of the Company.

                        "Stock Option" or "Option" means any option to purchase
            shares of Stock that is granted pursuant to Section 6.

SECTION 2.  ADMINISTRATION.

                        The Plan shall be administered by the Committee. The
Committee shall consist of not less than three directors of the Company, all of
whom shall be Non-Employee Directors. Committee members shall be appointed by
the Board and shall serve on the Committee at the pleasure of the Board. The
functions of the Committee specified in the Plan shall be exercised by the Board
if and to the extent that no Committee exists which has the authority to so
administer the Plan.

                         The Committee shall have full power to interpret and
administer the Plan and full authority to select the individuals to whom Awards
will be granted and to determine the type and amount of Awards to be granted to
each Participant, the consideration, if any, to be paid for such Awards, the
timing of such Awards, the terms and conditions of Awards granted under the Plan
and the terms and conditions of the related Award Agreements which will be
entered into with Participants.

                        The Committee shall have the authority to adopt, alter,
change and repeal such rules, regulations, guidelines and practices governing
the Plan, from time to time, as it shall deem advisable; to interpret the terms
and provisions of the Plan and any Award issued under the Plan (and any Award
Agreement relating thereto); to direct employees of the Company or other
advisors to prepare such materials or perform such analyses as the Committee
deems necessary or appropriate; and otherwise to supervise the administration of
the Plan.

                        Any interpretation and administration of the Plan by the
Committee, and all actions and determinations of the Committee, shall be final,
binding and conclusive on the Company, its shareholders, all Participants in the
Plan, their respective legal representatives, successors and assigns and all
persons claiming under or through any of them. No member of the Board or of the
Committee shall incur any liability for any action taken or omitted, or any
determination made, in good faith in connection with the Plan.

SECTION 3.  STOCK SUBJECT TO THE PLAN.

                        (a) Aggregate Stock Subject to the Plan. Subject to
            adjustment as provided in Section 3(c) below, the total number of
            shares of Stock reserved and available for Awards under the Plan is
            350,000. Any Stock issued hereunder may consist, in whole or in
            part, of authorized and unissued shares or treasury shares.

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                        (b) Forfeiture or Termination of Awards or Stock. If any
            Stock subject to any Award granted hereunder is forfeited or an
            Award otherwise terminates or expires without the issuance of Stock,
            the Stock that is subject to such Award shall again be available for
            distribution in connection with future Awards under the Plan as set
            forth in Section 3(a), unless the Participant who had been awarded
            such forfeited Stock or the expired or terminated Award has
            theretofor received dividends or other benefits of ownership with
            respect to such Stock. For purposes hereof, a Participant shall not
            be deemed to have received a benefit of ownership with respect to
            such Stock by the exercise of voting rights or the accumulation of
            dividends which are not realized due to the forfeiture of such Stock
            or the expiration or termination of the related Award without
            issuance of such Stock.

                        (c) Adjustment. In the event of any merger,
            reorganization, consolidation, recapitalization, share dividend,
            share split, reverse share split, combination of shares or other
            change in the corporate or capital structure of the Company
            affecting the Stock, such substitution or adjustment shall be made
            in the aggregate number of shares of Stock reserved for issuance
            under the Plan, in the maximum number of shares that may be subject
            to Awards granted to any Participant during any calendar year or
            other period, in the number and Option Exercise Price of shares
            subject to outstanding Options granted under the Plan and in the
            number of shares subject to Restricted Stock Awards granted under
            the Plan as may be approved by the Committee, in its sole
            discretion, to prevent dilution or enlargement of rights; provided
            that the number of shares subject to any Award shall always be a
            whole number. Any fractional shares shall be eliminated.

                        (d) Annual Award Limitation. No Participant may be
            granted Awards under the Plan with respect to an aggregate of more
            than 6,000 shares of Stock (subject to adjustment as provided in
            Section 3(c) hereof) during any calendar year.

SECTION 4.  ELIGIBILITY.

                        All directors of the Company who are not full time
employees of the Company or any of its subsidiaries ("Eligible Directors") are
eligible to be granted Awards under the Plan.

SECTION 5.  RESTRICTED STOCK.

                        (a) Grant. Subject to the terms and conditions of the
            Plan, Restricted Stock may be awarded to Eligible Directors at any
            time and from time to time as shall be determined by the Committee.
            The Committee shall determine the individuals to whom, and the time
            or times at which, grants of Restricted Stock will be made; the
            number of shares of Restricted Stock to be awarded to each
            Participant; the price (if any) to be paid by the Participant
            (subject to Section 5(b)); the date or dates or conditions upon
            which Restricted Stock Awards will vest; the period or periods
            within which such Restricted Stock Awards may be subject to
            restrictions and forfeiture; and the other terms and conditions of
            such Awards in addition to those set forth in Section 5(b).

                        The Committee may condition the grant or vesting of
            Restricted Stock upon the lapse of time or such other factors as the
            Committee may determine in its sole discretion.

                        (b) Terms and Conditions. Restricted Stock awarded under
            the Plan shall be subject to the following terms and conditions and
            shall contain such additional terms and conditions, not inconsistent
            with the provisions of the Plan, as the Committee shall deem
            desirable. A Participant


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            who receives a Restricted Stock Award shall not have any rights with
            respect to such Award, unless and until such Participant has
            executed an Award Agreement evidencing the Award in the form
            approved from time to time by the Committee and has delivered a
            fully executed copy thereof to the Company, and has otherwise
            complied with the applicable terms and conditions of such Award.

                        (1) The purchase price for shares of Restricted Stock
                        shall be determined by the Committee at the time of
                        grant and may be equal to their par value or zero.

                        (2) Awards of Restricted Stock must be accepted by
                        executing the related Restricted Stock Award Agreement,
                        delivering an executed copy of such Restricted Stock
                        Award Agreement to the Company and paying whatever price
                        (if any) is required under Section 5(b)(1).

                        (3) Subject to Section 5(b)(5), each Participant
                        receiving a Restricted Stock Award shall be issued a
                        stock certificate in respect of such shares of
                        Restricted Stock. Such certificate shall be registered
                        in the name of such Participant, and shall bear an
                        appropriate legend referring to the terms, conditions
                        and restrictions applicable to such Award.

                        (4) Subject to Section 5(b)(5), the stock certificates
                        evidencing such shares of Restricted Stock shall be
                        delivered to and held in custody by the Company, or its
                        designee, until the restrictions thereon shall have
                        lapsed or any conditions to the vesting of such Award
                        have been satisfied. As a condition of any Restricted
                        Stock Award, the Participant shall deliver to the
                        Company a stock power, endorsed in blank, relating to
                        the Stock covered by such Award.

                        (5) At the discretion of the Company, any shares of
                        Restricted Stock awarded to any Participant may be
                        issued and held in book entry form. In such event, no
                        stock certificates evidencing such shares will be issued
                        to the Participant and the applicable restrictions may
                        be noted in the records of the Company's stock transfer
                        agent and in the book entry system.

                        (6) Awards of Restricted Stock will vest and all
                        restrictions thereon will terminate upon the lapse of a
                        period of time specified by the Committee at the time of
                        grant, provided all other conditions to vesting have
                        been met.

                        (7) Subject to the provisions of this Plan and the
                        related Restricted Stock Award Agreement, during the
                        period set by the Committee commencing with the date of
                        a Restricted Stock Award (the "Restriction Period"), the
                        Participant who has received such Award shall not be
                        permitted to sell, transfer, pledge, assign or otherwise
                        encumber the shares of Restricted Stock which are
                        subject to such Award. The Restriction Period shall not
                        be less than six months and one day in duration
                        ("Minimum Restriction Period"). Subject to these
                        limitations and the Minimum Restriction Period
                        requirement, the Committee, in its sole discretion, may
                        provide for the lapse of such restrictions in
                        installments and may accelerate or waive such
                        restrictions, in whole or in part, based on service,
                        performance or such other factors and criteria as the
                        Committee may determine, in its sole discretion.

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                        (8) Except as provided in this Section 5(b)(8), Section
                        5(b)(7) or Section 5(b)(9), the Participant shall have,
                        with respect to the shares of Restricted Stock awarded,
                        all of the rights of a shareholder of the Company,
                        including the right to vote the Stock and the right to
                        receive any dividends. The Committee, in its sole
                        discretion, as determined at the time of award, may
                        permit or require the payment of cash dividends to be
                        deferred and, if the Committee so determines,
                        reinvested, subject to Section 10(c), in additional
                        Restricted Stock to the extent shares are available
                        under Section 3, or otherwise reinvested. Stock
                        dividends issued with respect to Restricted Stock shall
                        be treated as additional shares of Restricted Stock that
                        are subject to the same restrictions and other terms and
                        conditions that apply to the shares with respect to
                        which such dividends are issued.

                        (9) No Restricted Stock shall be transferable by any
                        Participant other than by will or by the laws of descent
                        and distribution, except that, if determined by the
                        Committee at the time of grant and so provided in the
                        applicable Award Agreement, a Participant may transfer
                        Restricted Stock during his or her lifetime to one or
                        more of his or her Family Members, provided that no
                        consideration is paid for the transfer and that the
                        transfer would not result in the loss of any exemption
                        under Rule 16b-3 of the Exchange Act with respect to any
                        Restricted Stock. The transferee of Restricted Stock
                        will be subject to all restrictions, terms and
                        conditions applicable to the Restricted Stock prior to
                        its transfer, except that the Restricted Stock will not
                        be further transferable by the transferee other than by
                        will or by the laws of descent and distribution.

                        (10) Subject to Section 5(b)(5), if a Participant dies
                        while serving as a member of the Board, his or her
                        estate shall be entitled to receive any shares of
                        Restricted Stock held by such Participant at the time of
                        death and such Restricted Stock shall thereafter vest,
                        or any restrictions lapse, on the vesting date or dates
                        specified in the related Award Agreements.

                        (11) If a Participant resigns or is removed from the
                        Board by reason of a Disability, he or she shall be
                        entitled to retain any Restricted Stock held by him or
                        her at the time of such resignation or removal and such
                        Restricted Stock shall thereafter vest, or any
                        restrictions lapse, on the vesting date or dates
                        specified in the related Award Agreements.

                        (12) Unless otherwise determined by the Committee at or
                        after the time of granting any Restricted Stock Award,
                        if a Director resigns or is removed from the Board for
                        any reason other than death or Disability or does not
                        stand for re-election, all Restricted Stock held by such
                        Participant which is unvested or subject to restriction
                        at the time of such resignation or removal, or at the
                        time such Director leaves the Board, shall thereupon be
                        forfeited.

SECTION 6.  STOCK OPTIONS.

                        (a) Grant. Subject to the terms and conditions of the
            Plan, Stock Options may be granted to Eligible Directors at any time
            and from time to time, as shall be determined by the Committee. The
            Committee shall determine the individuals to whom, and the time or
            times at which, grants of Stock Options will be made; the number of
            shares purchasable under each Stock Option; the time or times at
            which Stock Options will vest and become exercisable; and the other
            terms and conditions of the Stock Options (and the related Option
            Award Agreements) in addition


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            to those set forth in Sections 6(b) and 6(c). All Stock Options
            granted under the Plan shall be Non-Qualified Stock Options.

                        (b) Terms and Conditions. Options granted under the Plan
            shall be evidenced by Option Award Agreements, shall be subject to
            the following terms and conditions and shall contain such additional
            terms and conditions, not inconsistent with the terms of the Plan,
            as the Committee shall deem desirable:

                        (1) Option Exercise Price. The Option Exercise Price per
                        share of Stock purchasable under a Stock Option shall be
                        determined by the Committee at the time of grant and
                        shall not be less than 100% of the Fair Market Value of
                        the Stock on the date of grant.

                        (2) Option Term. The term of each Stock Option ("Option
                        Term") shall be determined by the Committee at the time
                        of grant and may not exceed ten years from the date the
                        Option is granted.

                        (3) Exercise. Stock Options shall be exercisable at such
                        time or times and subject to such terms and conditions
                        as shall be determined by the Committee at or after
                        grant; provided, however, that, except as provided in
                        Section 6(b)(6) and unless otherwise determined by the
                        Committee at or after grant, no Stock Option shall be
                        exercisable prior to six months and one day following
                        the date of grant. If any Stock Option is exercisable
                        only in installments or only after a specified vesting
                        date, the Committee may accelerate or waive, in whole or
                        in part, such installment exercise provisions or vesting
                        date, at any time at or after grant based on such
                        factors as the Committee shall determine, in its sole
                        discretion.

                        (4) Method of Exercise. Subject to whatever installment
                        exercise provisions apply with respect to such Stock
                        Option, and the six month and one day holding period set
                        forth in Section 6(b)(3) and any other conditions to
                        vesting, Stock Options may be exercised in whole or in
                        part, at any time during the Option Term, by giving to
                        the Company written notice of exercise specifying the
                        number of shares of Stock to be purchased.

                                    Such notice shall be accompanied by payment
                        in full of the Option Exercise Price of the shares of
                        Stock for which the Option is exercised, in cash or by
                        check or such other instrument as the Committee may
                        accept. Subject to the prior approval of the Committee,
                        in its sole discretion, at or after grant, payment, in
                        full or in part, of the Option Exercise Price may be
                        made in the form of unrestricted Stock then owned by the
                        Participant or Stock that is part of the Non-Qualified
                        Stock Option being exercised. The value of each such
                        share surrendered or withheld shall be equal to the Fair
                        Market Value of the Stock on the date the Option is
                        exercised.

                                    No Stock shall be issued pursuant to an
                        exercise of an Option until full payment has been made
                        therefor. A Participant shall not have rights to
                        dividends or any other rights of a shareholder with
                        respect to any Stock subject to an Option unless and
                        until the Participant has given written notice of
                        exercise, has paid in full for such shares, has given,
                        if requested, the representation described in Section
                        10(a) and such shares have been issued to the
                        Participant.

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                        (5) Non-Transferability of Options. Subject to the
                        following sentence, no Stock Option shall be
                        transferable by the Participant other than by will or by
                        the laws of descent and distribution, and all Stock
                        Options shall be exercisable, during the Participant's
                        lifetime, only by the Participant or, subject to Section
                        6(b)(3), by the Participant's authorized legal
                        representative if the Participant is unable to exercise
                        an Option as a result of the Participant's Disability.
                        Notwithstanding the foregoing, if determined by the
                        Committee at the time of grant and so provided in the
                        applicable Award Agreement, a Participant may transfer a
                        Non-Qualified Stock Option during his or her lifetime to
                        one or more of his or her Family Members, provided that
                        no consideration is paid for the transfer and that the
                        transfer would not result in the loss of any exemption
                        under Rule 16b-3 of the Exchange Act with respect to any
                        Stock Option. The transferee of a Stock Option will be
                        subject to all restrictions, terms and conditions
                        applicable to the Stock Option prior to its transfer,
                        except that the Stock Option will not be further
                        transferable by the transferee other than by will or by
                        the laws of descent and distribution.

                        (6) Termination by Death. If any Participant dies, any
                        Stock Option held by such Participant at the time of his
                        or her death may thereafter be exercised, to the extent
                        such Option was exercisable at the time of death or
                        would have become exercisable within one year from the
                        time of death had the Participant continued to fulfill
                        all conditions of the Option during such period (or on
                        such accelerated basis as the Committee may determine at
                        or after grant), by the estate of the Participant
                        (acting through its fiduciary) for a period of one year
                        (or such other period as the Committee may specify at or
                        after grant) from the date of such death. The balance of
                        the Stock Option shall be forfeited.

                        (7) Termination by Reason of Disability. Subject to
                        Section 6(b)(3), if a Participant resigns or is removed
                        from the Board by reason of a Disability, any Stock
                        Option then held by such Participant may thereafter be
                        exercised, to the extent such Option is exercisable at
                        the time of such resignation or removal or would have
                        become exercisable within one year from the time of such
                        resignation or removal had the Participant continued to
                        fulfill all conditions of the Option during such period
                        (or on such accelerated basis as the Committee may
                        determine at or after grant), by the Participant or by
                        the Participant's duly authorized legal representative
                        if the Participant is unable to exercise the Option as a
                        result of the Participant's Disability, for a period of
                        one year (or such other period as the Committee may
                        specify at or after grant) from the date of such
                        resignation or removal; provided that if the Participant
                        dies within such one-year period (or such other period
                        as the Committee shall specify at or after grant), any
                        unexercised Stock Option held by such Participant shall
                        thereafter be exercisable by the estate of the
                        Participant (acting through its fiduciary) to the same
                        extent to which it was exercisable at the time of death
                        for a period of one year from the date of such
                        termination of employment. The balance of the Stock
                        Option shall be forfeited.

                        (8) Other Termination. Unless otherwise determined by
                        the Committee at or after the time of granting any Stock
                        Option, if a Participant resigns or is removed from the
                        Board for any reason other than death or Disability, all
                        Stock Options held by such Participant shall thereupon
                        immediately terminate.

            (c) Buyout Provisions. The Committee may at any time buy out, for a
            payment in cash, Stock or Restricted Stock, any Option previously
            granted, based on such terms and conditions as the Committee shall
            establish and agree upon with the Participant, provided that no such
            transaction involving a Participant shall be structured or effected
            in a manner that would violate,


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            or result in any liability on the part of the Participant under,
            Section 16 of the Exchange Act or the rules and regulations
            promulgated thereunder.

SECTION 7.  CHANGE IN CONTROL PROVISION.

                        (a) Impact of Event. In the event of and upon: (1) a
            "Change in Control" as defined in Section 7(b) or (2) a "Potential
            Change in Control" as defined in Section 7(c), the following
            acceleration and valuation provisions shall apply:

                              (1) Any Stock Options awarded under the Plan not
                        previously exercisable and vested shall become fully
                        exercisable and vested;

                              (2) All restrictions and limitations, if any,
                        applicable to any Restricted Stock or Stock Options
                        shall terminate and such Stock or Stock Options shall be
                        deemed fully vested; and

                              (3) The value of all outstanding Awards, in each
                        case to the extent vested, shall, unless otherwise
                        determined by the Committee in its sole discretion at or
                        after grant but prior to any Change in Control or
                        Potential Change in Control, be cashed out on the basis
                        of the "Change in Control Price", as defined in Section
                        7(d), as of the date such Change in Control or such
                        Potential Change in Control is determined to have
                        occurred.

            (b) Definition of Change in Control. For purposes of Section 7(a), a
            "Change in Control" means the happening of any of the following:

                        (1) When any "person" as defined in Section 3(a)(9) of
                        the Exchange Act and as used in Sections 13(d) and 14(d)
                        thereof, including a "group" as defined in Section 13(d)
                        of the Exchange Act, but excluding the Company and any
                        Subsidiary and any employee benefit plan sponsored or
                        maintained by the Company or any Subsidiary (including
                        any trustee of such plan acting as trustee), directly or
                        indirectly, becomes the "beneficial owner" (as defined
                        in Rule 13d-3 under the Exchange Act, as amended from
                        time to time), of securities of the Company representing
                        20 percent or more of the combined voting power of the
                        Company's then outstanding securities; provided,
                        however, that the terms "person" and "group" shall not
                        include any "Excluded Director", and the term "Excluded
                        Director" means any director who, on the effective date
                        of the Plan, is the beneficial owner of or has the right
                        to acquire an amount of Stock equal to or greater than
                        five percent of the number of shares of Stock
                        outstanding on such effective date; and further provided
                        that, unless otherwise determined by the Board or any
                        committee thereof, the terms "person" and "group" shall
                        not include any entity or group of entities which has
                        acquired Stock of the Company in the ordinary course of
                        business for investment purposes only and not with the
                        purpose or effect of changing or influencing the control
                        of the Company, or in connection with or as a
                        participant in any transaction having such purpose or
                        effect, ("Investment Intent"), as demonstrated by the
                        filing by such entity or group of a statement on
                        Schedule 13G (including amendments thereto) pursuant to
                        Regulation 13D under the Exchange Act, as long as such
                        entity or group continues to hold such Stock with an
                        Investment Intent;


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                        (2) When, during any period of 24 consecutive months
                        during the existence of the Plan, the individuals who,
                        at the beginning of such period, constitute the Board
                        (the "Incumbent Directors") cease for any reason other
                        than death to constitute at least a majority thereof;
                        provided, however, that a director who was not a
                        director at the beginning of such 24-month period shall
                        be deemed to have satisfied such 24-month requirement
                        (and be an Incumbent Director) if such director was
                        elected by, or on the recommendation of or with the
                        approval of, at least two-thirds of the directors who
                        then qualified as Incumbent Directors either actually
                        (because they were directors at the beginning of such
                        24-month period) or by prior operation of this Section
                        7(b)(2); or

                        (3) The occurrence of a transaction requiring
                        shareholder approval for the acquisition of the Company,
                        or any portion of the outstanding equity securities or
                        voting power of the Company, by an entity other than the
                        Company or a Subsidiary through purchase of Stock or
                        assets, by merger or otherwise;

            provided, however, a change in control shall not be deemed to be a
            Change in Control for purposes of the Plan if the Board approves
            such change prior to either (i) the commencement of any of the
            events described in Section 7(b)(l), (2), or (3) or 7(c)(l) or (ii)
            the commencement by any person other than the Company of a tender
            offer for Stock.

                        (c) Definition of Potential Change in Control. For
            purposes of Section 7(a), a "Potential Change in Control" means the
            happening of any one of the following:

                        (1) The approval by shareholders of an agreement by the
                        Company, the consummation of which would result in a
                        Change in Control of the Company as defined in Section
                        7(b); or

                        (2) The acquisition of beneficial ownership, directly or
                        indirectly, by any entity, person or group (other than
                        the Company or a Subsidiary or any Company employee
                        benefit plan (including any trustee of such plan acting
                        as such trustee)) of securities of the Company
                        representing five percent or more of the combined voting
                        power of the Company's outstanding securities and the
                        adoption by the Board of a resolution to the effect that
                        a Potential Change in Control of the Company has
                        occurred for purposes of this Plan.

                        (d) Change in Control Price. For purposes of this
            Section 7, "Change in Control Price" means the highest price per
            share paid in any transaction reported on the New York Stock
            Exchange Composite Index, or paid or offered in any bona fide
            transaction related to a Change in Control or Potential Change in
            Control of the Company, at any time during the 60-day period
            immediately preceding the occurrence of the Change in Control (or,
            where applicable, the occurrence of the Potential Change in Control
            event), in each case as determined by the Committee.

SECTION 8.  AMENDMENTS AND TERMINATION.

                        The Board may at any time, in its sole discretion,
amend, alter or discontinue the Plan, but no such amendment, alteration or
discontinuation shall be made which would impair the rights of a Participant
under an Award theretofore granted, without the Participant's consent. The
Company shall submit to the shareholders of the Company for their approval any
amendments to the Plan which are


                                     - 10 -
<PAGE>
required to be approved by shareholders, either by law or the rules and
regulations of any governmental authority or any stock exchange upon which the
Stock is then traded.

                        Subject to changes in law or other legal requirements
that would permit otherwise, the Plan may not be amended without the approval of
the shareholders, to (a) increase the total number of shares of Stock that may
be issued under the Plan or to any Participant during any calendar year (except
for adjustments pursuant to Section 3(c)), (b) permit the granting of Stock
Options with exercise prices lower than those specified in Section 6(b)(1) or
(c) modify the Plan's eligibility requirements.

                        The Committee may at any time, in its sole discretion,
amend the terms of any outstanding Award, but no such amendment shall be made
which would impair the rights of a Participant under an Award theretofore
granted, without the Participant's consent; nor, in the case of any Award of a
Stock Option, shall any such amendment reduce the Option Exercise Price relating
to such Stock Option or, in any other case, reduce the purchase price (if any)
of the Stock which is subject to an outstanding Award; nor shall any such
amendment be made which would make the applicable exemptions provided by Rule
16b-3 under the Exchange Act unavailable to any Participant holding an Award
without the Participant's consent.

                        Subject to the above provisions, the Board shall have
all necessary authority to amend the Plan to take into account changes in
applicable securities and tax laws and accounting rules, as well as
other developments.


SECTION 9.  UNFUNDED STATUS OF PLAN.

                        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 by the Company, nothing contained herein shall give any
such Participant any rights that are greater than those of a general creditor of
the Company.

SECTION 10.  GENERAL PROVISIONS.

                        (a) The Committee may require each Participant acquiring
            Stock pursuant to an Award under the Plan to represent to and agree
            with the Company in writing that the Participant is acquiring the
            Stock without a view to distribution thereof. Any certificates for
            such shares may include any legend which the Committee deems
            appropriate to reflect any restrictions on transfer.

                            All shares of Stock or other securities issued
            under the Plan shall be subject to such stop-transfer orders and
            other restrictions as the Committee may deem advisable under the
            rules, regulations and other requirements of the Securities and
            Exchange Commission, any stock exchange upon which the Stock is then
            listed, and any applicable federal or state securities laws, and the
            Committee may cause a legend or legends to be placed on any
            certificates for such shares to make appropriate reference to such
            restrictions or to cause such restrictions to be noted in the
            records of the Company's stock transfer agent and any applicable
            book entry system.

                        (b) Nothing contained in this Plan shall prevent the
            Board from adopting other or additional compensation arrangements,
            subject to shareholder approval if such approval is required; and
            such arrangements may be either generally applicable or applicable
            only in specific cases.

                                     - 11 -
<PAGE>
                        (c) The actual or deemed reinvestment of dividends in
            additional Stock or Restricted Stock at the time of any dividend
            payment shall only be permissible if sufficient shares of Stock are
            available under Section 3 for such reinvestment (taking into account
            the then outstanding and previously granted Restricted Stock and
            Stock Options).

                        (d) The Plan, all Awards made and all actions taken
            thereunder and any agreements relating thereto, shall be governed by
            and construed in accordance with the laws of the State of Ohio.

                        (e) In the event any Award is transferred or assigned
            pursuant to a court order, such transfer or assignment shall be
            without liability to the Company and the Company shall have the
            right to offset against such Award any expenses (including
            attorneys' fees) incurred by the Company in connection with such
            transfer or assignment.

                        (f) All Award Agreements entered into with Participants
            pursuant to the Plan shall be subject to the Plan. A Participant who
            receives an Award under the Plan shall not have any rights with
            respect to such Award, unless and until such Participant has
            executed an Award Agreement evidencing the Award, in form approved
            by the Committee; has delivered a fully-executed copy of such Award
            Agreement to the Company; and has otherwise complied with the
            applicable terms and conditions of such Award.

                        (g) The provisions of Awards need not be the same with
            respect to each Participant.


SECTION 11.  SHAREHOLDER APPROVAL; EFFECTIVE DATE OF PLAN.

                        The Plan was adopted by the Board on January 31, 2003
and is subject to approval by the holders of the Company's outstanding Stock, in
accordance with applicable law. The Plan will become effective on the date of
such approval.


SECTION 12.  TERM OF PLAN.

                        No Award shall be granted pursuant to the Plan on or
after January 31, 2013, but Awards granted prior to such date may extend beyond
that date.

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</DOCUMENT>
