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                                                                     EXHIBIT 4.4




                        EOG RESOURCES, INC. SAVINGS PLAN





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ARTICLE I             DEFINITIONS

         1.1      Account......................................................................................I-1
         1.2      Active Service...............................................................................I-1
         1.3      Actual Contribution Ratio....................................................................I-1
         1.4      Actual Deferral Percentage...................................................................I-1
         1.5      Actual Deferral Ratio........................................................................I-2
         1.6      Affiliated Employer..........................................................................I-2
         1.7      Aggregate Accounts...........................................................................I-2
         1.8      Aggregation Group............................................................................I-2
         1.9      Annual Additions.............................................................................I-2
         1.10     Annual Compensation..........................................................................I-2
         1.11     Annuity Starting Date........................................................................I-3
         1.12     Beneficiary..................................................................................I-3
         1.13     Board of Directors...........................................................................I-3
         1.14     Code.........................................................................................I-3
         1.15     Committee....................................................................................I-3
         1.16     Company Stock................................................................................I-3
         1.17     Considered Compensation......................................................................I-3
         1.18     Contribution.................................................................................I-3
         1.19     Contribution Percentage......................................................................I-4
         1.20     Determination Date...........................................................................I-4
         1.21     Direct Rollover..............................................................................I-4
         1.22     Disability...................................................................................I-4
         1.23     Distributee..................................................................................I-4
         1.24     Eligible Retirement Plan.....................................................................I-4
         1.25     Eligible Rollover Distribution...............................................................I-4
         1.26     Employee.....................................................................................I-5
         1.27     Employer or Employers........................................................................I-5
         1.28     ERISA........................................................................................I-5
         1.29     Excess 401(k) Contributions..................................................................I-5
         1.30     Excess Aggregate 401(m) Contributions........................................................I-5
         1.31     Excess Deferral..............................................................................I-5
         1.32     Five Percent Owner...........................................................................I-6
         1.33     Former Member................................................................................I-6
         1.34     Highly Compensated Employee..................................................................I-6
         1.35     Hour of Service..............................................................................I-6
         1.36     Key Employee.................................................................................I-6
         1.37     Limitation Year..............................................................................I-6
         1.38     Member.......................................................................................I-6
         1.39     Non-Highly Compensated Employee..............................................................I-7
         1.40     Non-Key Employee.............................................................................I-7
         1.41     Period of Service............................................................................I-7
         1.42     Period of Severance..........................................................................I-7
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         1.43     Plan.........................................................................................I-7
         1.44     Plan Year....................................................................................I-7
         1.45     Qualified Joint and Survivor Annuity.........................................................I-7
         1.46     Qualified Nonelective Employer Contribution..................................................I-7
         1.47     Qualified Preretirement Survivor Annuity.....................................................I-7
         1.48     Regulation...................................................................................I-7
         1.49     Retirement Age...............................................................................I-7
         1.50     Rollover Contribution........................................................................I-7
         1.51     Section 401(k) Contributions.................................................................I-7
         1.52     Section 401(m) Contributions.................................................................I-8
         1.53     Service......................................................................................I-8
         1.54     Severs Service...............................................................................I-8
         1.55     Sponsor......................................................................................I-8
         1.56     Top-Heavy Plan...............................................................................I-8
         1.57     Transferred..................................................................................I-8
         1.58     Trust........................................................................................I-8
         1.59     Trustee......................................................................................I-8
         1.60     Trust Fund...................................................................................I-8
         1.61     USERRA.......................................................................................I-8
         1.62     Valuation Date...............................................................................I-9

ARTICLE II            ACTIVE SERVICE

         2.1      When Active Service Begins..................................................................II-1
         2.2      Aggregation of Service......................................................................II-1
         2.3      Eligibility Computation Periods.............................................................II-1
         2.4      Periods of Service of Less Than One Year....................................................II-1
         2.5      Service Prior to Severance..................................................................II-1
         2.6      Periods of Severance Due to Child Birth or Adoption.........................................II-1
         2.7      Transfers...................................................................................II-2
         2.8      Employment Records Conclusive...............................................................II-2
         2.9      Coverage of Certain Previously Excluded Employees...........................................II-2
         2.10     Military Service............................................................................II-2

ARTICLE III           ELIGIBILITY RULES

         3.1      Eligibility Requirements...................................................................III-1
         3.2      Eligibility Upon Reemployment..............................................................III-1
         3.3      Frozen Participation.......................................................................III-1

ARTICLE IV            CONTRIBUTIONS AND THEIR LIMITATIONS

         4.1      Employee After Tax Contributions............................................................IV-1
         4.2      Rollover Contributions and Direct Transfers.................................................IV-1
         4.3      Salary Deferral Contributions...............................................................IV-1
         4.4      Employer Matching Contributions.............................................................IV-2
         4.5      Employer Discretionary Contributions........................................................IV-2
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         4.6      Restoration Contributions...................................................................IV-2
         4.7      Qualified Nonelective Employer Contribution.................................................IV-2
         4.8      Top-Heavy Contribution......................................................................IV-2
         4.9      Contributions Required on Return From Military Service......................................IV-3
         4.10     Deadline for Payment of Contributions.......................................................IV-3
         4.11     Limitations Based Upon Deductibility and the Maximum Allocation Permitted to a
                  Member's Account............................................................................IV-3
         4.12     Dollar Limitation on Salary Deferral Contributions..........................................IV-3
         4.13     Limitation Based Upon Actual Deferral Percentage............................................IV-4
         4.14     Limitation Based Upon Contribution Percentage...............................................IV-6
         4.15     Alternative Limitation Based Upon Actual Deferral Percentage and Contribution
                  Percentage..................................................................................IV-7
         4.16     Excess Deferral Fail Safe...................................................................IV-8
         4.17     Actual Deferral Percentage Fail Safe........................................................IV-8
         4.18     Contribution Percentage Fail Safe...........................................................IV-9
         4.19     Alternative Limitation Fail Safe...........................................................IV-10
         4.20     Income Allocable to Excess 401(k) and Aggregate 401(m) Contributions.......................IV-10
         4.21     Return of Contributions for Mistake, Disqualification or Disallowance of Deduction.........IV-10

ARTICLE V             PARTICIPATION

         5.1      Allocation of Employee Contributions.........................................................V-1
         5.2      Allocation of Rollover Contributions and Direct Transfers....................................V-1
         5.3      Allocation of Salary Deferral Contributions..................................................V-1
         5.4      Allocation of Employer Matching Contributions................................................V-1
         5.5      Allocation of Employer Discretionary Contributions...........................................V-1
         5.6      Allocation of Restoration Contributions......................................................V-1
         5.7      Allocation of Qualified Nonelective Employer Contributions...................................V-1
         5.8      Allocation of Top-Heavy Contributions........................................................V-2
         5.9      Effect of Transfers Upon Allocations.........................................................V-2
         5.10     Application of Forfeitures...................................................................V-2
         5.11     Scheduled Allocation of Income or Losses and Appreciation or Depreciation....................V-2
         5.12     Interim Allocation of Income or Losses and Appreciation or Depreciation......................V-2

ARTICLE VI            DISTRIBUTIONS AND FORFEITURES

         6.1      Valuation of Accounts for Distributions.....................................................VI-1
         6.2      Distribution on Death.......................................................................VI-1
         6.3      Distribution on Retirement..................................................................VI-1
         6.4      Distribution on Disability..................................................................VI-1
         6.5      Distribution on Severance From Service......................................................VI-1
         6.6      Distribution on Issuance of a Qualified Domestic Relations Order............................VI-2
         6.7      Forfeiture on Severing Service With All Affiliated Employers................................VI-2
         6.8      Forfeiture by Lost Members or Beneficiaries; Escheat........................................VI-3
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         6.9      Qualified Joint and Survivor and Qualified Preretirement Survivor Annuity...................VI-3
         6.10     Form of Distributions.......................................................................VI-5
         6.11     Adjustment of Value of Distribution.........................................................VI-6
         6.12     Normal Time for Distribution................................................................VI-6
         6.13     Time Limit For Distribution.................................................................VI-6
         6.14     Protected Benefits..........................................................................VI-7

ARTICLE VII           WITHDRAWALS AND LOANS

         7.1      Valuation of Accounts for Withdrawals and Loans............................................VII-1
         7.2      Withdrawals of Employee After Tax and Rollover Accounts....................................VII-1
         7.3      Withdrawal for Financial Hardship..........................................................VII-1
         7.4      Withdrawals On or After Age 59 1/2.........................................................VII-2
         7.5      Loans......................................................................................VII-2

ARTICLE VIII          GENERAL PROVISIONS APPLICABLE TO FILING A
                      CLAIM, DISTRIBUTIONS TO MINORS AND NO
                      DUPLICATION OF BENEFITS

         8.1      Claims Procedure..........................................................................VIII-1
         8.2      No Duplication of Benefits................................................................VIII-1
         8.3      Distributions to Disabled or Minors.......................................................VIII-1

ARTICLE IX            TOP-HEAVY REQUIREMENTS

         9.1      Application.................................................................................IX-1
         9.2      Top-Heavy Test..............................................................................IX-1
         9.3      Vesting Restrictions if Plan Becomes Top-Heavy..............................................IX-1
         9.4      Minimum Contribution if Plan Becomes Top-Heavy..............................................IX-2
         9.5      Coverage Under Multiple Top-Heavy Plans.....................................................IX-3

ARTICLE X             ADMINISTRATION OF THE PLAN

         10.1     Appointment, Term of Service & Removal.......................................................X-1
         10.2     Powers.......................................................................................X-1
         10.3     Organization.................................................................................X-2
         10.4     Quorum and Majority Action...................................................................X-2
         10.5     Signatures...................................................................................X-2
         10.6     Disqualification of Committee Member.........................................................X-2
         10.7     Disclosure to Members........................................................................X-2
         10.8     Standard of Performance......................................................................X-2
         10.9     Liability of Committee and Liability Insurance...............................................X-2
         10.10    Exemption from Bond..........................................................................X-3
         10.11    Compensation.................................................................................X-3
         10.12    Persons Serving in Dual Fiduciary Roles......................................................X-3
         10.13    Administrator................................................................................X-3
         10.14    Standard of Judicial Review of Committee Actions.............................................X-3
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ARTICLE XI            TRUST FUND AND CONTRIBUTIONS

         11.1     Funding of Plan.............................................................................XI-1
         11.2     Incorporation of Trust......................................................................XI-1
         11.3     Authority of Trustee........................................................................XI-1
         11.4     Allocation of Responsibility................................................................XI-1

ARTICLE XII           ADOPTION OF PLAN BY OTHER EMPLOYERS

         12.1     Adoption Procedure.........................................................................XII-1
         12.2     No Joint Venture Implied...................................................................XII-1
         12.3     All Trust Assets Available to Pay All Benefits.............................................XII-1
         12.4     Qualification a Condition Precedent to Adoption and Continued Participation................XII-1

ARTICLE XIII          AMENDMENT AND WITHDRAWAL OR TERMINATION

         13.1     Right to Amend............................................................................XIII-1
         13.2     Limitation on Amendments..................................................................XIII-1
         13.3     Each Employer Deemed to Adopt Amendment Unless Rejected...................................XIII-1
         13.4     Amendment Applicable Only to Members Still Employed Unless Amendment Specifically
                  Provides Otherwise........................................................................XIII-2
         13.5     Mandatory Amendments......................................................................XIII-2
         13.6     Withdrawal of Employer....................................................................XIII-2
         13.7     Termination of Plan.......................................................................XIII-3
         13.8     100% Vesting Required on Partial or Complete Termination or Complete Discontinuance.......XIII-3
         13.9     Distribution Upon Termination.............................................................XIII-3

ARTICLE XIV           SALE OF EMPLOYER OR SUBSTANTIALLY ALL OF ITS ASSETS

         14.1     Continuance Permitted Upon Sale or Transfer of Assets......................................XIV-1
         14.2     Distributions Upon Disposition of Assets or a Subsidiary...................................XIV-1

ARTICLE XV            MISCELLANEOUS

         15.1     Plan Not An Employment Contract.............................................................XV-1
         15.2     Benefits Provided Solely From Trust.........................................................XV-1
         15.3     Anti-Alienation Provision...................................................................XV-1
         15.4     Requirements Upon Merger or Consolidation of Plans..........................................XV-2
         15.5     Gender and Number...........................................................................XV-2
         15.6     Severability................................................................................XV-2
         15.7     Governing Law; Parties to Legal Actions.....................................................XV-2

ARTICLE XVI           VOTING OF COMPANY STOCK AND TENDER OFFERS

         16.1     Voting of Company Stock....................................................................XVI-1
         16.2     Tender Offers..............................................................................XVI-1
         16.3     Shares Credited............................................................................XVI-3
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         16.4     Conversion.................................................................................XVI-3
         16.5     Named Fiduciary............................................................................XVI-3
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                        EOG RESOURCES, INC. SAVINGS PLAN

         EOG Resources, Inc. has entered into the following Agreement:

                                   WITNESSETH:

         WHEREAS, EOG Resources, Inc. has heretofore adopted a qualified profit
sharing plan with a 401(k) feature and exempt trust for the exclusive benefit of
its employees and their beneficiaries; and

         WHEREAS, it has been determined that the plan should now be completely
amended, restated and continued without a gap or lapse in coverage, time or
effect which would cause any Member to become fully vested or entitled to
distribution, in order to (a) effect numerous technical changes for the benefit
of eligible employees and beneficiaries, and (b) to ensure the plan's
qualification under the applicable provisions of the Internal Revenue Code of
1986, as amended, and the Employee Retirement Income Security Act of 1974, as
amended; and

         WHEREAS, it is intended that other business organizations may adopt
this plan and its related trust for the exclusive benefit of their employees and
their employees' beneficiaries;

         NOW, THEREFORE, this Agreement is entered into in order to set forth
the terms of that profit sharing plan with a 401(k) feature which are as
follows:



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                                   ARTICLE I

                                   DEFINITIONS

         The words and phrases defined in this Article shall have the meaning
set out in the definition unless the context in which the word or phrase appears
reasonably requires a broader, narrower or different meaning.

         1.1 "ACCOUNT" means all ledger accounts pertaining to a Member which
are maintained by the Committee to reflect the Member's interest in the Trust
Fund. The Committee shall establish the following Accounts and any additional
Accounts that the Committee considers necessary to reflect the entire interest
of the Member in the Trust Fund. Each of the Accounts listed below and any
additional Accounts established by the Committee shall reflect the Contributions
or amounts transferred to the Trust Fund, if any, and the appreciation or
depreciation of the assets in the Trust Fund and the income earned or loss
incurred on the assets in the Trust Fund attributable to the Contributions
and/or other amounts transferred to the Account.

                  (a) Employee After Tax Contribution Account - The Member's
         after tax contributions, if any.

                  (b) Salary Deferral Contribution Account - The Member's before
         tax contributions, if any.

                  (c) Employer Matching Contribution Account - The Employer's
         matching contributions allocated to the Member, if any.

                  (d) Employer Discretionary Contribution Account - The
         Employer's discretionary contributions, if any.

                  (e) Qualified Nonelective Employer Contribution Account - The
         Employer's Qualified Nonelective Employer Contributions allocated to
         the Member, if any.

                  (f) Rollover Account - Funds transferred from another
         qualified plan or IRA Account for the benefit of a Member.

         1.2 "ACTIVE SERVICE" means the Periods of Service which are counted for
either eligibility or vesting purposes as calculated under Article II.

         1.3 "ACTUAL CONTRIBUTION RATIO" means for an Employee the ratio of
Section 401(m) Contributions actually paid into the Trust on behalf of the
Employee for a Plan Year to the Employee's Annual Compensation earned while the
Employee was a Member for the same Plan Year.

         1.4 "ACTUAL DEFERRAL PERCENTAGE" means for a specified group of
Employees for a Plan Year the average of the ratios (calculated separately for
each Employee in the group) of the sum of Section 401(k) Contributions actually
paid into the Trust on behalf of each Employee for



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<PAGE>   10

that Plan Year to the Employee's Annual Compensation earned while the Employee
was a Member for the same Plan Year.

         1.5 "ACTUAL DEFERRAL RATIO" means for an Employee the ratio of Section
401(k) Contributions actually paid into the Trust on behalf of the Employee for
a Plan Year to the Employee's Annual Compensation earned while the Employee was
a Member for the same Plan Year.

         1.6 "AFFILIATED EMPLOYER" means the Employer and any employer which is
a member of the same controlled group of corporations within the meaning of
section 414(b) of the Code, which is a trade or business (whether or not
incorporated) which is under common control within the meaning of section 414(c)
of the Code, which is a member of an affiliated service group within the meaning
of section 414(m) of the Code with the Employer, or which is required to be
aggregated with the Employer under section 414(o) of the Code. For purposes of
the limitation on allocations contained in Part B of Article V, the definition
of Affiliated Employer is modified by substituting the phrase "more than 50
percent" in place of the phrase "at least 80 percent" each place the latter
phrase appears in section 1563(a)(1) of the Code.

         1.7 "AGGREGATE ACCOUNTS" means the total of all Account balances
derived from Employer Contributions and Employee Contributions.

         1.8 "AGGREGATION GROUP" means (a) each plan of the Employer or any
Affiliated Employer in which a Key Employee is a Member and (b) each other plan
of the Employer or any Affiliated Employer which enables any plan in (a) to meet
the requirements of either section 401(a)(4) or 410 of the Code. Any Employer
may treat a plan not required to be included in the Aggregation Group as being a
part of the group if the group would continue to meet the requirements of
sections 401(a)(4) and 410 of the Code with that plan being taken into account.

         1.9 "ANNUAL ADDITIONS" means the sum of the following amounts credited
on behalf of a Member for the Limitation Year: (a) Employer Contributions, (b)
Employee After Tax Contributions, and (c) forfeitures. Excess 401(k)
Contributions and Excess Aggregate 401(m) Contributions for a Plan Year are
treated as Annual Additions for that Plan Year even if they are corrected
through distribution or recharacterization. Excess Deferrals that are timely
distributed as set forth in Section 4.12 shall not be treated as Annual
Additions.

         1.10 "ANNUAL COMPENSATION" means wages within the meaning of section
3401(a) of the Code and all other payments of compensation to an Employee by the
Affiliated Employer for which a written statement is required to be furnished
under sections 6041(d), 6051(a)(3), and 6052 of the Code (but determined without
regard to any rules under section 3401(a) of the Code that limit the
remuneration included in wages based on the nature or location of the employment
or the services performed) as modified by including elective contributions under
a cafeteria plan described in section 125 of the Code and elective contributions
to any plan qualified under section 401(k), 408(k), or 403(b) of the Code.
Except for purposes of Part B of Article V of the Plan, Annual Compensation in
excess of $150,000.00 (as adjusted by the Secretary of Treasury) shall be
disregarded. If the Plan Year is ever less than 12 months the $150,000.00
limitation (as adjusted by the Secretary of Treasury) will be prorated by
multiplying the limitation by a fraction, the numerator of which is the number
of months in the Plan Year, and the denominator



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of which is 12. For purposes of determining an Employee's Actual Contribution
Ratio or Actual Deferral Ratio, Annual Compensation shall include only
compensation earned during the portion of the Plan Year that the Employee was
eligible to participate in the Plan.

         1.11 "ANNUITY STARTING DATE" means the first day of the first period
for which an amount is payable as an annuity, or in the case of a benefit not
payable in the form of an annuity, the first day on which all events have
occurred which entitle the Member to the benefit.

         1.12 "BENEFICIARY" or Beneficiaries means the person or persons, or the
trust or trusts created for the benefit of a natural person or persons or the
Member's or Former Member's estate, designated by the Member or Former Member to
receive the benefits payable under this Plan upon his death.

         1.13 "BOARD OF DIRECTORS" means the board of directors, the executive
committee or other body given management responsibility for the Sponsor.

         1.14 "CODE" means the Internal Revenue Code of 1986, as amended from
time to time.

         1.15 "COMMITTEE" means the committee appointed by the Sponsor to
administer the Plan.

         1.16 "COMPANY STOCK" means EOG Resources, Inc. common stock.

         1.17 "CONSIDERED COMPENSATION" means as to each Employee, that
Employee's Annual Compensation as modified further by excluding the following
items (even if includable in gross income): overtime, bonuses, commissions,
reimbursements or other expense allowances, fringe benefits (cash and noncash),
moving expenses, deferred compensation and welfare benefits. Considered
Compensation in excess of $150,000.00 (as adjusted by the Secretary of Treasury)
shall be disregarded. If the Plan Year is ever less than 12 months the
$150,000.00 limitation (as adjusted by the Secretary of Treasury) will be
prorated by multiplying the limitation by a fraction, the numerator of which is
the number of months in the Plan Year, and the denominator of which is 12.

         1.18 "CONTRIBUTION" means the total amount of contributions made under
the terms of this Plan. Each specific type of Contribution shall be designated
by the type of contribution made as follows:

                  (a) Employee After Tax Contribution - After tax contributions
         made by the Employee.

                  (b) Salary Deferral Contribution - Contributions made by the
         Employer under the Employee's salary deferral agreement.

                  (c) Employer Matching Contribution - Matching contributions
         made by the Employer.




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<PAGE>   12

                  (d) Employer Discretionary Contribution - Contributions made
         by the Employer on a discretionary basis.

                  (e) Qualified Nonelective Employer Contribution - Qualified
         Nonelective Employer Contributions made by the Employer as a means of
         passing the actual deferral percentage test of section 401(k) of the
         Code or the actual contribution percentage test of section 401(m) of
         the Code.

                  (f) Rollover Contribution - Contributions made by a Member
         which consist of any part of an Eligible Rollover Distribution (as
         defined in section 402 of the Code) from a qualified employee trust
         described in section 401(a) of the Code or an IRA Rollover Account.

         1.19 "CONTRIBUTION PERCENTAGE" means for a specified group of Employees
for a Plan Year the average of the ratios (calculated separately for each
Employee in the group) of the sum of Section 401(m) Contributions actually paid
into the Trust on behalf of each Employee for that Plan Year to the Employee's
Annual Compensation earned while the Employee was a Member for that Plan Year.

         1.20 "DETERMINATION DATE" means for a given Plan Year the last day of
the preceding Plan Year or in the case of the first Plan Year the last day of
that Plan Year.

         1.21 "DIRECT ROLLOVER" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.

         1.22 "DISABILITY" means any medically determinable physical or mental
impairment that is deemed to be a disability by the Social Security
Administration Department for purpose of receiving a Primary Social Security
Disability benefit, or any such physical or mental impairment which is
determined to make the individual eligible to receive a disability benefit in
accordance with the provisions of the Employer's insured long term disability
plan, if applicable to such Employee, by the insurance carrier underwriting such
plan.

         1.23 "DISTRIBUTEE" means an Employee or former Employee, and in
addition, the Employee's or former Employee's surviving spouse or the Employee's
or former Employee's spouse or former spouse who is the alternate payee under a
qualified domestic relations order, as defined in section 414(p) of the Code,
with regard to the interest of the spouse or former spouse.

         1.24 "ELIGIBLE RETIREMENT PLAN" means an individual retirement account
described in section 408(a) of the Code, an individual retirement annuity
described in section 408(b) of the Code, an annuity plan described in section
403(a) of the Code, or a qualified trust described in section 401(a) of the
Code, that accepts the Distributee's Eligible Rollover Distribution. However, in
the case of an Eligible Rollover Distribution to the surviving spouse, an
Eligible Retirement Plan is an individual retirement account or individual
retirement annuity.

         1.25 "ELIGIBLE ROLLOVER DISTRIBUTION" as defined in section 402 of the
Code means any distribution of all or any portion of the balance to the credit
of the Distributee, except that an Eligible Rollover Distribution does not
include: (a) any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life (or life




                                      I-4
<PAGE>   13

expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee's Beneficiary, or for a specified period
of ten years or more; (b) any distribution to the extent the distribution is
required under section 401(a)(9) of the Code; (c) the portion of any
distribution that is not includable in gross income (determined without regard
to the exclusion for net unrealized appreciation with respect to employer
securities); and (d) any hardship distribution described in section
401(k)(2)(B)(i)(IV) of the Code.

         If the Plan accepts a Rollover Contribution which the Trustee
reasonably concludes is qualified under this Section of the Plan, and
subsequently it is determined that such distribution was not qualified, the
Trustee shall distribute the amount of such rollover distribution, plus earnings
thereon, to the Member in compliance with applicable Regulations.

         1.26 "EMPLOYEE" means all common law employees of each Employer
exclusive of the following classifications: (a) employees working outside of the
United States unless the Committee elects to cover or continue to cover them in
this Plan and (b) all leased employees who are required to be treated as common
law employees under section 414(n) of the Code unless the Plan's qualified
status is dependent upon coverage of the leased employees. Independent
contractors are not common law employees and are therefore not within the
defined term "Employee" as used in this Plan. The determination of whether a
person is within an excluded class or is an independent contractor shall be made
by the Committee in its sole discretion as granted in Article X. However, if
either one or more individuals who are classified as leased employees or
independent contractors are later determined to be in fact common law employees
of an Employer, they are nevertheless to be excluded as a classification unless
the Plan's qualified status is dependent upon the coverage of that
classification of persons.

         1.27 "EMPLOYER" or "EMPLOYERS" means the Sponsor and any other business
organization which has adopted this Plan.

         1.28 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.

         1.29 "EXCESS 401(k) CONTRIBUTIONS" means, with respect to any Plan
Year, the excess of (a) the aggregate amount of Section 401(k) Contributions
actually paid into the Trust on behalf of Highly Compensated Employees for the
Plan Year over (b) the maximum amount of those contributions permitted under the
limitations set out in the first sentence of Section 4.13 of the Plan.

         1.30 "EXCESS AGGREGATE 401(m) CONTRIBUTIONS" means, with respect to any
Plan Year, the excess of (a) the aggregate amount of Section 401(m)
Contributions actually paid into the Trust on behalf of Highly Compensated
Employees for the Plan Year over (b) the maximum amount of those contributions
permitted under the limitations set out in the first sentence of Section 4.14 of
the Plan.

         1.31 "EXCESS DEFERRAL" means that part, if any, of the Salary Deferral
Contribution of a Member for his taxable year which, when added to the amounts
he deferred under other plans or arrangements described in sections 401(k),
408(k) and 403(b) of the Code, exceeds the deferral dollar limitation permitted
by section 402(g) of the Code.




                                      I-5
<PAGE>   14

         1.32 "FIVE PERCENT OWNER" means an Employee who is a 5-percent owner as
defined in section 416(i) of the Code.

         1.33 "FORMER MEMBER" means a person who was at one time a Member who
received allocations of Contributions and who is no longer a Member under the
Plan, but still has an Account balance in the Plan.

         1.34 "HIGHLY COMPENSATED EMPLOYEE" means an Employee or an employee of
an Affiliated Employer who: (a) during the Plan Year or the preceding Plan Year
was at any time a Five Percent Owner or (b) for the preceding year had Annual
Compensation in excess of $80,000.00 (as adjusted from time to time by the
Secretary of the Treasury) and was in the group consisting of the top 20 percent
of the Employees when ranked on the basis of Annual Compensation paid during the
preceding year. A former Member will be treated as a Highly Compensated Employee
if he was a Highly Compensated Employee when he Severed Service or he was a
Highly Compensated Employee at any time after attaining age 55. Non-resident
aliens who receive no earned income from the employer which constitutes income
from sources within the United States are excluded.

         1.35 "HOUR OF SERVICE" means each hour for which an Employee is paid or
entitled to payment for the performance of duties with an Affiliated Employer.

         1.36 "KEY EMPLOYEE" means an Employee or former or deceased Employee or
Beneficiary of an Employee who at any time during the Plan Year or any of the
four preceding Plan Years is (a) an officer of an Employer or any Affiliated
Employer having an Annual Compensation greater than 50% of the annual addition
limitation of section 415(b)(1)(A) of the Code for the Plan Year, (b) one of the
10 employees having an Annual Compensation from an Employer or any Affiliated
Employer of greater than 100% of the annual addition limitation of section
415(c)(1)(A) of the Code for the Plan Year and owning or considered as owning
(within the meaning of section 318 of the Code) the largest interest in an
Employer or any Affiliated Employer, treated separately, (c) a Five Percent
Owner of an Employer or any Affiliated Employer, treated separately, or (d) a 1%
owner of an Employer or any Affiliated Employer, treated separately, having
Annual Compensation from an Employer or any Affiliated Employer of more than
$150,000.00, as adjusted. For this purpose no more than 50 employees or, if
lesser, the greater of three employees or 10% of the employees shall be treated
as officers. Section 416(i) of the Code shall be used to determine percentage of
ownership. For the purpose of the test set out in (b) above, if two or more
employees have the same interest in an Employer, the employee with the greater
Annual Compensation from the Employer shall be treated as having the larger
interest.

         1.37 "LIMITATION YEAR" means the year used for purposes of applying the
limitations under section 415 of the Code. The Limitation Year shall be the Plan
Year unless the Employer affirmatively, by resolution, designates another
limitation year.

         1.38 "MEMBER" means the person or persons employed by an Employer who
are eligible to participate in this Plan.




                                      I-6
<PAGE>   15

         1.39 "NON-HIGHLY COMPENSATED EMPLOYEE" means any Employee who is not a
Highly Compensated Employee.

         1.40 "NON-KEY EMPLOYEE" means any Employee who is not a Key Employee.

         1.41 "PERIOD OF SERVICE" means a period of employment with an
Affiliated Employer which commences on the day on which an Employee performs his
initial Hour of Service or performs his initial Hour of Service upon returning
to the employ of an Affiliated Employer, whichever is applicable, and ends on
the date the Employee Severs Service.

         1.42 "PERIOD OF SEVERANCE" means the period of time which commences on
the date an Employee Severs Service and ends on the date the Employee again
performs an Hour of Service.

         1.43 "PLAN" means the EOG Resources, Inc. Savings Plan, including all
subsequent amendments.

         1.44 "PLAN YEAR" means the calendar year. The Plan Year shall be the
fiscal year of this Plan.

         1.45 "QUALIFIED JOINT AND SURVIVOR ANNUITY" means an annuity which is
purchased with the Member's vested Account balance as of the date of
distribution that will provide equal monthly payments for the life of the
Member, with a survivor annuity for the life of the Member's spouse equal to 50%
of the amount of the monthly payments payable during the joint lives of the
Member and the Member's spouse.

         1.46 "QUALIFIED NONELECTIVE EMPLOYER CONTRIBUTION" means the Employer's
Contribution, if any, made as a means of passing the Actual Deferral Percentage
test or the Contribution Percentage test.

         1.47 "QUALIFIED PRERETIREMENT SURVIVOR ANNUITY" means an annuity which
is purchased with the Member's vested Account balance as of the date of
distribution that will provide equal monthly payments for the life of the
surviving spouse.

         1.48 "REGULATION" means the Internal Revenue Service regulation
specified, as it may be changed from time to time.

         1.49 "RETIREMENT AGE" means 65 years of age, but may mean 55 years of
age, the earliest date at which a Member may retire, if the Member has completed
five years of Service and desires voluntarily to retire early. Once a Member has
attained his Retirement Age he shall be 100% vested at all times.

         1.50 "ROLLOVER CONTRIBUTION" means the amount contributed by a Member
to his Account in this Plan which consists of any part or all of an Eligible
Rollover Distribution.

         1.51 "SECTION 401(k) CONTRIBUTIONS" means the sum of Salary Deferral
Contributions made on behalf of the Member during the Plan Year and Qualified
Nonelective Employer Contributions that the Employer elects to have treated as
Section 401(k) Contributions pursuant



                                      I-7
<PAGE>   16

to section 401(k)(3)(D)(ii) of the Code to the extent that those contributions
are not used to enable the Plan to satisfy the minimum contribution requirements
of section 416 of the Code.

         1.52 "SECTION 401(m) CONTRIBUTIONS" means the sum of Employer Matching
Contributions and Employee After Tax Contributions made on behalf of the Member
during the Plan Year and Qualified Nonelective Employer Contributions that the
Employer elects to have treated as Section 401(m) Contributions pursuant to
section 401(m)(3)(B) of the Code to the extent that those contributions are not
used to enable the Plan to satisfy the minimum contribution requirements of
section 416 of the Code.

         1.53 "SERVICE" means the period or periods that a person is paid or is
entitled to payment for performance of duties with an Affiliated Employer.

         1.54 "SEVERS SERVICE" means the earlier of the following events: (a)
the Employee's quitting, retiring, dying or being discharged, (b) the completion
of a period of 365 continuous days in which the Employee remains absent from
Service (with or without pay) for any reason other than quitting, retiring,
dying or being discharged, such as vacation, holiday, sickness, disability,
leave of absence, layoff or any other absence or (c) the second anniversary of
the commencement of a continuous period of absence occasioned by the reason of
the pregnancy of the Employee, the birth of a child of the Employee, the
placement of a child with the Employee in connection with the adoption of the
child by the Employee or the caring for the child for a period commencing
immediately after the child's birth or placement.

         1.55 "SPONSOR" means EOG Resources, Inc. or any other organization
which assumes the primary responsibility for maintaining this Plan with the
consent of the last preceding Sponsor.

         1.56 "TOP-HEAVY PLAN" means any plan which has been determined to be
top-heavy under the test described in Article IX of this Plan.

         1.57 "TRANSFERRED" means an Employee's termination of employment with
one Employer and his contemporaneous commencement of employment with another
Employer.

         1.58 "TRUST" means the one or more trust estates created to fund this
Plan.

         1.59 "TRUSTEE" means collectively one or more persons or entities with
trust powers which have been appointed by the initial Sponsor and have accepted
the duties of Trustee and any and all successor or successors appointed by the
Sponsor or successor Sponsor.

         1.60 "TRUST FUND" means all of the trust estates established under the
terms of this Plan to fund this Plan, whether held to fund a particular group of
Accounts or held to fund all of the Accounts of Members, collectively.

         1.61 "USERRA" means the Uniformed Services Employment And Reemployment
Rights Act of 1994 which was enacted on October 13, 1994 as Public Law 103-353
and which amended Chapter 43 of Title 38 of the United States Code.




                                      I-8
<PAGE>   17

         1.62 "VALUATION DATE" means the day or days each Plan Year selected by
the Committee on which the Trust Fund is to be valued which cannot be less
frequent than annual. One or more Accounts may have different Valuation Dates
from other Accounts. The Valuation Date must be announced to all Members and
Former Members who have Account Balances and shall remain the same until changed
by the Committee and announced to the Members. Until changed by the Committee,
the Valuation Date shall be daily.




                                      I-9
<PAGE>   18
                                   ARTICLE II

                                 ACTIVE SERVICE

         2.1 WHEN ACTIVE SERVICE BEGINS. For purposes of eligibility and
vesting, Active Service begins when an Employee first performs an Hour of
Service for an Affiliated Employer or an employer the stock or assets of which
were or are acquired by an Employer or Affiliated Employer without regard to
whether a predecessor plan was maintained. Once an Employee has begun Active
Service for purposes of eligibility or vesting and Severs Service he shall
recommence Active Service for those purposes when he again performs an Hour of
Service for an Affiliated Employer. For purposes of the Plan, Active Service
shall include service performed with Enron Corp. or one of its subsidiaries if
the Employee was employed by the Employer on August 16, 1999.

         2.2 AGGREGATION OF SERVICE. When determining an Employee's Active
Service, all Periods of Service, whether or not completed consecutively, shall
be aggregated on a per day basis. Thirty days shall be counted as one month and
12 months shall be counted as one year. For purposes of eligibility and vesting,
only full years of Active Service shall be counted, any fractional year shall be
dropped.

         2.3 ELIGIBILITY COMPUTATION PERIODS. For the purpose of determining
eligibility and vesting, the initial period shall begin on the day the Employee
first performs an Hour of Service and each future year shall begin on the
anniversary of that date.

         2.4 PERIODS OF SERVICE OF LESS THAN ONE YEAR. If an Employee performs
an Hour of Service within 12 months after he Severs Service, the intervening
Period of Severance shall be counted as a Period of Service.

         2.5 SERVICE PRIOR TO SEVERANCE. If an Employee incurs a Period of
Severance of one year or more, all Periods of Service prior to that Period of
Severance shall not count as Active Service until the Employee has completed a
Period of Service of one year or more after his return to Service. If an
Employee Severs Service at a time when he does not have any vested right to
amounts credited to his Employer Matching Contribution Account or Employer
Discretionary Contribution Account and the Period of Severance continues for a
continuous period of five years or more, the Period of Service completed by the
Employee before the Period of Severance shall not be taken into account if his
Period of Severance equals or exceeds his Period of Service, whether or not
consecutive, completed before the Period of Severance.

         2.6 PERIODS OF SEVERANCE DUE TO CHILD BIRTH OR ADOPTION. If the period
of time between the first anniversary of the first day of an absence from
Service by reason of the pregnancy of the Employee, the birth of a child of the
Employee, the placement of a child with the Employee in connection with the
adoption of the child by the Employee or for purposes for caring for the child
for a period beginning immediately after the birth or placement and the second
anniversary of the first day of the absence occurs during or after the first
Plan Year beginning after December 31, 1984, it shall neither be counted as a
Period of Service nor of Severance.




                                      II-1
<PAGE>   19

         2.7 TRANSFERS. If an Employee is Transferred from one Employer to
another, his Active Service shall not be interrupted and he shall continue to be
in Active Service for purposes of eligibility, vesting and allocation of
Contributions and/or forfeitures. If an Employee is transferred to the service
of an Affiliated Employer that has not adopted the Plan he shall not have
Severed Service; however, even though he shall continue to be in Active Service
for eligibility and vesting purposes he shall not receive any allocation of
Contributions or forfeitures.

         2.8 EMPLOYMENT RECORDS CONCLUSIVE. The employment records of the
Employer shall be conclusive for all determinations of Active Service.

         2.9 COVERAGE OF CERTAIN PREVIOUSLY EXCLUDED EMPLOYEES. Any Employee who
is no longer excludable because he or she is no longer included in a unit of
Employees covered by a collective bargaining agreement between the Employees'
representative and the Employer where retirement benefits were the subject of
good faith bargaining shall immediately become eligible for membership if he
meets the eligibility requirements. All his Service with any Affiliated Employer
that would have been counted had he not been previously excluded shall now be
counted as Active Service for eligibility and vesting purposes.

         2.10 MILITARY SERVICE. A Member who leaves the employ of an Employer to
enter the armed services of the United States and is covered by USERRA shall not
be deemed to have broken his continuous employment if he is reemployed under
USERRA. And, the Member shall be awarded Active Service upon reemployment for
each period served by him in the uniformed services for eligibility, vesting and
benefit accrual purposes.




                                      II-2
<PAGE>   20
                                  ARTICLE III

                                ELIGIBILITY RULES

         3.1 ELIGIBILITY REQUIREMENTS. Each Employee shall be eligible to
participate in this Plan beginning on the date on which the Employee completes
one Hour of Service. However, all Employees who are included in a unit of
Employees covered by a collective bargaining agreement between the Employees'
representative and the Employer shall be excluded, even if they have met the
requirements for eligibility, if there has been good faith bargaining between
the Employer and the Employees' representative pertaining to retirement benefits
and the agreement does not require the Employer to include those Employees in
this Plan. In addition, all Employees who are nonresident aliens and who receive
no earned income from the Employer that constitutes income from sources within
the United States shall be excluded. Notwithstanding any other provision of the
Plan to the contrary, effective as of March 1, 2001, each Employee classified by
the Employer as a Minimal Benefits Employee shall be excluded from being
eligible to receive allocations of Employer Matching Contributions and Employer
Discretionary Contributions under the Plan even if such Employee has satisfied
the requirements for eligibility to receive an allocation of the Employer
Matching Contributions and Employer Discretionary Contributions and is having
Salary Deferral Contributions made on his behalf by the Employer.

         3.2 ELIGIBILITY UPON REEMPLOYMENT. If an Employee Severs Service with
the Employer for any reason after fulfilling the eligibility requirements but
prior to the date he initially begins participating in the Plan, the Employee
shall be eligible to begin participation in this Plan on the day he first
completes an Hour of Service upon his return to employment with an Employer.
Once an Employee has become eligible to be a Member, his eligibility shall
continue until he Severs Service. A former Member shall be eligible to
recommence participation in this Plan on the first day he completes an Hour of
Service upon his return to employment with an Employer.

         3.3 FROZEN PARTICIPATION. An employee employed by an Affiliated
Employer, which has not adopted this Plan, cannot actively participate in this
Plan even though he accrues Active Service. Likewise, if an Employee: (a) is
transferred from an Employer to an Affiliated Employer which has not adopted
this Plan, (b) is a Member of this Plan when he is excluded from this Plan
because he becomes excluded under the provisions of a collective bargaining
agreement or because he becomes a leased employee or an independent contractor
and he has not had a complete termination of his contractual relationship with
all Affiliated Employers, or (c) is a Member of the Plan when he is employed
outside the United States and is not designated by the Committee to continue to
be eligible to participate, his participation becomes inactive. Under these
circumstances, the Member's Account becomes frozen: he cannot contribute to the
Plan nor can he share in the allocation of any Employer Contribution or
forfeitures for the frozen period. However, his Accounts shall continue to share
in any appreciation or depreciation of the Trust Fund and in any income earned
or losses incurred by the Trust Fund during the frozen period of time. Once the
contract or contracts of an independent contractor, who has a frozen Account,
have expired with all Affiliated Employers in a good-faith and complete
termination of the contractual relationship and no renewal is expected or once
an employee who has a frozen



                                     III-1
<PAGE>   21

Account terminates his employment with all Affiliated Employers, he shall have
Severed Service for purposes of distribution of benefits.




                                     III-2
<PAGE>   22
                                   ARTICLE IV

                       CONTRIBUTIONS AND THEIR LIMITATIONS

                             PART A.  CONTRIBUTIONS

         4.1 EMPLOYEE AFTER TAX CONTRIBUTIONS. The Committee may permit Employee
After Tax Contributions to be made by Members from time to time. If the
Committee permits Contributions by Members, the opportunity must be made
available to all Members on a nondiscriminatory basis. If the Committee decides
to stop all Contributions by Members, the Contributions to the effective date of
the announcement shall be retained in the Trust Fund subject to the right of
withdrawal described under this Plan.

         Employee After Tax Contributions are limited to an amount which, when
added to the other amounts required to be taken into consideration, will not
exceed the limit set by section 415 of the Code and will meet the Contribution
Percentage test described in section 401(m) of the Code.

         Changes in the rate of Employee After Tax Contributions and suspension
of those Contributions shall be permitted under any uniform method determined
from time to time by the Committee.

         4.2 ROLLOVER CONTRIBUTIONS AND DIRECT TRANSFERS. The Committee may
permit Rollover Contributions by Members and/or direct transfers to or from
another qualified plan on behalf of Members from time to time. If Rollover
Contributions and/or direct transfers to or from another qualified plan are
permitted, the opportunity to make those Contributions must be made available to
all Members on a nondiscriminatory basis. For this purpose, all Employees of an
Employer who are in a classification which may participate in this Plan shall be
considered to be Members of the Plan even though they may not have met the
eligibility requirements. However, they shall not be entitled to elect to have
Salary Deferral Contributions or Employee After Tax Contributions or share in
any Employer Contribution unless and until they have met the requirements for
eligibility and allocation.

         A Rollover Contribution shall not be accepted unless it is directly
rolled over to this Plan in a roll over described in section 401(a)(31) of the
Code and the property is acceptable to the Trustee. A direct transfer of assets
from another qualified plan in a transfer subject to the requirements of section
414(l) of the Code shall not be accepted if it was at any time part of the plan
which contained a right, feature or benefit not contained in this Plan unless
the Committee, in its sole discretion, agrees to continue to provide that right,
feature or benefit to that portion of the Member's Account.

         Rollover Contributions shall have no effect upon the amount permitted
to be allocated to a Member's Account under section 415 of the Code, or the
amount contributed to the Plan by a Member under Section 4.1.

         4.3 SALARY DEFERRAL CONTRIBUTIONS. Each Employer shall contribute for
each Plan Year the amount by which the Member's Considered Compensation is
reduced as a result of a



                                      IV-1
<PAGE>   23

salary deferral agreement, from one percent (1%) to fifteen percent (15%) of the
Member's Considered Compensation for the Plan Year, less the amount of the
Member's Employee After Tax Contribution, if any.

         The election to have Salary Deferral Contributions made, the ability to
change the rate of Salary Deferral Contributions, the right to suspend Salary
Deferral Contributions, and the manner of commencing new Salary Deferral
Contributions shall be permitted under any uniform method determined from time
to time by the Committee.

         4.4 EMPLOYER MATCHING CONTRIBUTIONS. Effective for the period beginning
on August 31, 1999 and ending on December 31, 1999, each Employer shall
contribute for each Plan Year an amount, for each Member who is employed by one
of the Employers at the end of the month, which is equal to fifty percent (50%)
of the Member's Salary Deferral Contribution not in excess of four percent (4%)
of the Member's Considered Compensation. Effective January 1, 2000, each
Employer shall contribute for each Plan Year an amount, for each Member who is
employed by one of the Employers at the end of the month, which is equal to one
hundred percent (100%) of the Member's Salary Deferral Contribution not in
excess of six percent (6%) of the Member's Considered Compensation.

         An Employer Matching Contribution shall not be made with respect to
amounts that must be distributed to the Member because of Code sections 401(k),
401(m) or 402(g). Therefore, if inadvertent Employer Matching Contributions were
made on behalf of a Member on amounts that must be distributed to the Member,
that excess amount, plus any earnings, shall be refunded to the Employer.

         4.5 EMPLOYER DISCRETIONARY CONTRIBUTIONS. Each Employer shall
contribute for each Plan Year an amount, if any, which is designated by the
Board of Directors in its sole discretion to be the Employer Discretionary
Contribution for the Plan Year.

         4.6 RESTORATION CONTRIBUTIONS. Each Employer shall contribute for each
Plan Year an amount, which when added to previously unapplied and unallocated
forfeitures, shall equal the amounts which were not vested and therefore
forfeited by Members who have previously terminated but who have now become
entitled to have their forfeited amounts restored plus an amount equal to the
value of all forfeited benefits for Members who formerly could not be located,
but have now filed a claim.

         4.7 QUALIFIED NONELECTIVE EMPLOYER CONTRIBUTION. Each Employer
concerned shall contribute for a given Plan Year an amount, if any, which is
designated by the Board of Directors to be the Qualified Nonelective Employer
Contribution for the Plan Year.

         A Member's right to benefits derived from Qualified Nonelective
Employer Contributions made to the Plan on his behalf shall be nonforfeitable.
In no event will Qualified Nonelective Employer Contributions be distributed
before Salary Deferral Contributions may be distributed.

         4.8 TOP-HEAVY CONTRIBUTION. Each Employer concerned shall contribute
for a given Plan Year an amount which is equal to the amount, if any, necessary
to fulfill the Top-Heavy Plan requirements found in Article IX if the Plan is
determined to be a Top-Heavy Plan.




                                      IV-2
<PAGE>   24

         4.9 CONTRIBUTIONS REQUIRED ON RETURN FROM MILITARY SERVICE. If a Member
leaves the employ of an Employer to enter the armed services of the United
States and is covered by USERRA and is reemployed under USERRA, the Employer
shall make a contribution equal to the amount of the Employer Discretionary
Contributions which would have been allocated to the Member's Account if he had
remained in the employ of the Employer for the period of time he was covered by
USERRA. In addition, the Member may make additional "catch up" Salary Deferral
Contributions during a period beginning on his date of reemployment and ending
on the earlier of (a) three times the period of his qualified military service
and (b) five years equal to the maximum amount he could have made and the
Employer must make the appropriate Employer Matching Contributions. The Employer
shall not make any contribution for lost earnings or failure to share in
forfeitures.

         4.10 DEADLINE FOR PAYMENT OF CONTRIBUTIONS. The Employee After Tax
Contributions and the Salary Deferral Contributions are to be paid to the
Trustee in installments. The installment for each payroll period is to be paid
as of the end of the payroll period and shall be paid as soon as
administratively feasible but in any event not later than the time prescribed by
law for filing the Employer's federal income tax return (including extensions)
for its taxable year which ends with or next follows the end of the Plan Year
for which the Contribution is to be made. The Employer's Contribution for a Plan
Year must be paid into the Trust Fund in one or more installments not later than
the time prescribed by law for filing the Employer's federal income tax return
(including extensions) for its taxable year for which it is to take the
deduction. If the Contribution is paid after the last day of the Employer's
taxable year but prior to the date it files its tax return (including
extensions), it shall be treated as being received by the Trustee on the last
day of the taxable year if (a) the Employer notifies the Trustee in writing that
the payment is being made for that taxable year or (b) the Employer claims the
Contribution as a deduction on its federal income tax return for the taxable
year.

                PART B.  LIMITATIONS APPLICABLE TO CONTRIBUTIONS

         4.11 LIMITATIONS BASED UPON DEDUCTIBILITY AND THE MAXIMUM ALLOCATION
PERMITTED TO A MEMBER'S ACCOUNT. Notwithstanding any other provision of this
Plan, no Employer shall make any contribution that would be a nondeductible
contribution within the meaning of section 4972 of the Code or that would cause
the limitation on allocations to each Member's Account within the meaning of
section 415 of the Code to be exceeded. For a further description of the
limitation on allocations and the corrections permitted, see Part B of
Article V.

         4.12 DOLLAR LIMITATION ON SALARY DEFERRAL CONTRIBUTIONS. The maximum
Salary Deferral Contribution that a Member may elect to have made on his behalf
during the Member's taxable year may not, when added to the amounts deferred
under other plans or arrangements described in sections 401(k), 408(k) and
403(b) of the Code exceed $7,000 (as adjusted by the Secretary of Treasury).

         For purposes of applying the requirements of Section 4.13 and Article
IX, Excess Deferrals shall not be disregarded merely because they are Excess
Deferrals or because they are distributed in accordance with this Section.
However, Excess Deferrals made to the Plan on behalf of Non-Highly Compensated
Employees are not to be taken into account under Section 4.13.




                                      IV-3
<PAGE>   25

         If the Member makes "elective deferrals," as defined in Regulations
issued pursuant to section 402(g) of the Code, to more than one plan, which
exceed the limit described above in the aggregate, such Member may elect a
distribution of a part or all of such excess amount what has been contributed to
the Plan. An election to receive a distribution of such Excess Deferrals must be
in writing and must include the Employee's certification that the specified
amount is an Excess Deferral. Such election must be made not later than the
first March 15th following the close of the Plan Year in which such Excess
Deferrals occurred. Upon such election, the excess amount specified by the
Member shall be distributed to the Member not later than the first April 15th
following the close of the Plan Year in which such Excess Deferrals occurred.
The amount of such excess to be distributed shall be reduced by the amount of
any excess contributions previously distributed for the Plan Year beginning
within the taxable year for which the excess under this Section is distributed.

         In the event Employer Matching Contributions that have been made on
behalf of the Member that relate to the Excess Deferrals distributed pursuant to
the previous paragraph become discriminatory due to the above distribution, the
Employer may distribute such excess contributions to the Member if such
contributions meet the definition of Excess Aggregate 401(m) Contributions under
the Plan. If the Employer Matching Contributions cannot be distributed as Excess
Aggregate 401(m) Contributions, the excess contributions shall be forfeited in
accordance with applicable sections of the Code and Regulations.

4.13 LIMITATION BASED UPON ACTUAL DEFERRAL PERCENTAGE. The Actual Deferral
Percentage for eligible Highly Compensated Employees for any Plan Year must bear
a relationship to the Actual Deferral Percentage for all other eligible
Employees for the preceding Plan Year which meets either of the following tests:

                  (a) the Actual Deferral Percentage of the eligible Highly
         Compensated Employees is not more than the Actual Deferral Percentage
         of all other eligible Employees multiplied by 1.25; or

                  (b) the excess of the Actual Deferral Percentage of the
         eligible Highly Compensated Employees over that of all other eligible
         Employees is not more than two percentage points, and the Actual
         Deferral Percentage of the eligible Highly Compensated Employees is not
         more than the Actual Deferral Percentage of all other eligible
         Employees multiplied by two.

         For the initial Plan Year of this Plan and for the initial Plan Year of
any Employer which adopts this Plan as its separate plan, the amount taken into
account as the Actual Deferral Percentage of Non-highly Compensated Employees
for the preceding Plan Year shall be (a) three percent or (b) if the Employer
makes an election under this subclause (b), the Actual Deferral Percentage of
Non-highly Compensated Employees for the first Plan year.

         For purposes of this test an eligible Employee is an Employee who is
directly or indirectly eligible to make Salary Deferral Contributions for all or
part of the Plan Year. A person who is suspended from making Salary Deferral
Contributions because he has made a withdrawal is an eligible Employee. If no
Salary Deferral Contributions are made for an eligible



                                      IV-4
<PAGE>   26

Employee, the Actual Deferral Ratio that shall be included for him in
determining the Actual Deferral Percentage is zero.

         If this Plan and any other plan or plans which include cash or deferred
arrangements are considered as one plan for purposes of section 401(a)(4) or
410(b) of the Code, the cash or deferred arrangements included in this Plan and
the other plans shall be treated as one plan for these tests. If any Highly
Compensated Employee is a Member of this Plan and any other cash or deferred
arrangements of the Employer, when determining the deferral percentage of the
Employee, all of the cash or deferred arrangements are treated as one. If the
Employer elects to apply section 410(b)(4)(B) of the Code in determining whether
the Plan meets the requirements of section 401(k)(3)(A)(i) of the Code, the
Employer may, in determining whether the arrangement meets the requirements of
section 401(k)(3)(A)(ii), exclude from consideration all eligible Employees
(other than Highly Compensated Employees) who are not 21 years of age or have
not completed one year of Active Service by the end of the Plan Year.

         The Actual Deferral Percentages are to be calculated and the provisions
of this Section are to be applied, separately, for each Employer which
constitutes a separate controlled group or affiliated service group.

         A Salary Deferral Contribution will be taken into account under the
Actual Deferral Percentage test of Code section 401(k) and this Section for a
Plan Year only if it relates to Annual Compensation that either would have been
received by the Employee in the Plan Year (but for the deferral election) or is
attributable to services performed by the employee in the Plan Year and would
have been received by the Employee within 2 1/2 months after the close of the
Plan Year (but for the deferral election). In addition, a Section 401(k)
Contribution will be taken into account under the Actual Deferral Percentage
test of Code section 401(k) and this Section for a Plan Year only if it is
allocated to an Employee as of a date within that Plan Year. For this purpose of
a Section 401(k) Contribution is considered allocated as of a date within a Plan
Year if the allocation is not contingent on participation or performance of
services after that date and the Section 401(k) Contribution is actually paid to
the Trust no later than 12 months after the Plan Year to which the Section
401(k) Contribution relates.

         Failure to correct Excess 401(k) Contributions by the close of the Plan
Year following the Plan Year for which they were made will cause the Plan's cash
or deferred arrangement to be disqualified for the Plan Year for which the
Excess 401(k) Contributions were made and for all subsequent years during which
they remain in the Trust. Also, the Employer will be liable for a 10% excise tax
on the amount of Excess 401(k) Contributions unless they are corrected within
2 1/2 months after the close of the Plan Year for which they were made.

         In the event Employer Matching Contributions that have been made on
behalf of the Member that relate to the Excess 401(k) Contributions distributed
in accordance with Plan provisions become discriminatory as a result of such
distribution, the Employer may distribute such excess contributions to the
Member if such contributions meet the definition of Excess Aggregate 401(m)
Contributions under the Plan. If the Employer Matching Contributions cannot be
distributed as Excess Aggregate 401(m) Contributions, the excess contributions
shall be forfeited in accordance with applicable sections of the Code and
Regulations.




                                      IV-5
<PAGE>   27

         4.14 LIMITATION BASED UPON CONTRIBUTION PERCENTAGE. The Contribution
Percentage for eligible Highly Compensated Employees for any Plan Year must not
exceed the greater of the following:

                  (a) the Contribution Percentage for all other eligible
         Employees for the preceding Plan Year multiplied by 1.25; or

                  (b) the lesser of the Contribution Percentage for all other
         eligible Employees for the preceding Plan Year multiplied by two, or
         the Contribution Percentage for all other eligible Employees for the
         preceding Plan Year plus two percentage points.

         For the initial Plan Year of this Plan and for the initial Plan Year of
any Employer which adopts this Plan as its separate plan, the amount taken into
account as the Contribution Percentage of Non-highly Compensated Employees for
the preceding Plan Year shall be (a) three percent or (b) if the Employer makes
an election under this subclause (b), the Contribution Percentage of Non-highly
Compensated Employees for the first Plan Year.

         For purposes of this test an eligible Employee is an Employee who is
directly or indirectly eligible to make Employee After Tax Contributions or to
receive an allocation of Employer Matching Contributions under the Plan for all
or part of the Plan Year. A person who is suspended from making Employee After
Tax Contributions because he has made a withdrawal, a person who would be
eligible to receive an allocation of Employer Matching Contributions but for his
election not to participate, and a person who would be eligible to receive an
allocation of Employer Matching Contributions but for the limitation on his
Annual Additions imposed by section 415 of the Code, are all eligible Employees.

         If no Section 401(m) Contributions are made on behalf of an eligible
Employee, the Actual Contribution Ratio that shall be included for him in
determining the Contribution Percentage is zero. If this Plan and any other plan
or plans to which Section 401(m) Contributions are made are considered as one
plan for purposes of section 401(a)(4) or 410(b) of the Code, this Plan and
those plans are to be treated as one. The Actual Contribution Ratio of a Highly
Compensated Employee who is eligible to participate in more than one plan of an
Affiliated Employer to which employee or matching contributions are made is
calculated by treating all the plans in which the Employee is eligible to
participate as one plan. However, plans that are not permitted to be aggregated
under Regulation section 1.410(m)-1(b)(3)(ii) are not aggregated for this
purpose.

         A Matching Employer Contribution will be taken into account under this
Section for a Plan Year only if (a) it is allocated to the Employee's Account as
of a date within the Plan Year, (b) it is paid to the Trust no later than the
end of the 12 month period beginning after the close of the Plan Year, and (c)
it is made on behalf of an Employee on account of his Salary Deferral
Contributions for the Plan Year.

         If the Employer elects to apply section 410(b)(4)(B) of the Code in
determining whether the Plan meets the requirements of section 410(b) of the
Code, the Employer may, in determining whether the arrangement meets the
requirements of section 401(m)(2) of the Code exclude from consideration all
eligible Employees (other than Highly Compensated Employees)



                                      IV-6
<PAGE>   28

who are not 21 years of age or have not completed one year of Active Service by
the end of the Plan Year.

         The Contribution Percentage shall be calculated and the provisions of
this Section applied, separately, for each Employer which constitutes a separate
controlled group or affiliated service group.

         At the election of the Employer, a Member's Salary Deferral
Contributions, and Qualified Nonelective Employer Contributions made on behalf
of the Member during the Plan Year shall be treated as Section 401(m)
Contributions that are Employer Matching Contributions provided that the
conditions set forth in Regulation section 1.401(m)-1(b)(5) are satisfied.
Salary Deferral Contributions may not be treated as Employer Matching
Contributions for purposes of the Contribution Percentage test unless the
contributions, including those taken into account for purposes of the test,
satisfy the Actual Deferral Percentage test set forth in Section 4.13. Salary
Deferral Contributions and Qualified Nonelective Employer Contributions may not
be taken into account for purposes of the test to the extent that those
contributions are taken into account in determining whether any other
contributions satisfy the Actual Deferral Percentage test set forth in Section
4.13. Finally, Salary Deferral Contributions and Qualified Nonelective Employer
Contributions may be taken into account for purposes of the test only if they
are allocated to the Employee's Account as of a date within the Plan Year being
tested within the meaning of Regulation section 1.401(k)-1(b)(4).

         Failure to correct Excess Aggregate 401(m) Contributions by the close
of the Plan Year following the Plan Year for which they were made will cause the
Plan to fail to be qualified for the Plan Year for which the Excess Aggregate
401(m) Contributions were made and for all subsequent years during which they
remain in the Trust. Also, the Employer will be liable for a 10% excise tax on
the amount of Excess Aggregate 401(m) Contributions unless they are corrected
within 2 1/2 months after the close of the Plan Year for which they were made.

         4.15 ALTERNATIVE LIMITATION BASED UPON ACTUAL DEFERRAL PERCENTAGE AND
CONTRIBUTION PERCENTAGE. If the second alternative permitted in Sections 4.13
and 4.14 is used for both the Actual Deferral Percentage test and the
Contribution Percentage test the following additional limitation on Salary
Deferral Contributions shall apply. The Actual Deferral Percentage plus the
Contribution Percentage of the eligible Highly Compensated Employees cannot
exceed the greater of (a) or (b), where:

              (a) is the sum of:

                  (i) 1.25 times the greater of the Actual Deferral Percentage
              or the Contribution Percentage of the eligible Non-Highly
              Compensated Employees for the preceding Plan Year, and

                  (ii) the lesser of (x) two percentage points plus the lesser
              of the Actual Deferral Percentage or the Contribution Percentage
              of the eligible Non-Highly Compensated Employees for the preceding
              Plan Year or (y) two times the lesser of the Actual Deferral
              Percentage or the Contribution Percentage of the group of eligible
              Non-Highly Compensated Employees for the preceding Plan Year, and




                                      IV-7
<PAGE>   29

              (b) is the sum of:

                  (i) 1.25 times the lesser of the Actual Deferral Percentage or
              the Contribution Percentage of the eligible Non-Highly Compensated
              Employees for the preceding Plan Year, and

                  (ii) the lesser of (x) two percentage points plus the greater
              of the Actual Deferral Percentage or the Contribution Percentage
              of the eligible Non-Highly Compensated Employees for the preceding
              Plan Year or (y) two times the greater of the Actual Deferral
              Percentage or the Contribution Percentage of the group of eligible
              Non-Highly Compensated Employees for the preceding Plan Year.

                   PART C.  CORRECTION PROCEDURES FOR ERRONEOUS
                                 CONTRIBUTIONS

         4.16 EXCESS DEFERRAL FAIL SAFE. As soon as practical after the close of
each Plan Year, the Committee shall determine if there would be any Excess
Deferrals. If there would be an Excess Deferral by a Member, the Excess Deferral
as adjusted by any earnings or losses, will be distributed to the Member no
later than April 15 following the Member's taxable year in which the Excess
Deferral was made. The income allocable to the Excess Deferrals for the taxable
year of the Member shall be determined by multiplying the income for the taxable
year of the Member allocable to Salary Deferral Contributions by a fraction. The
numerator of the fraction is the amount of the Excess Deferrals made on behalf
of the Member for the taxable year. The denominator of the fraction is the
Member's total Salary Deferral Account balance as of the beginning of the
taxable year plus the Member's Salary Deferral Contributions for the taxable
year.

         4.17 ACTUAL DEFERRAL PERCENTAGE FAIL SAFE. As soon as practicable after
the close of each Plan Year, the Committee shall determine whether the Actual
Deferral Percentage for the Highly Compensated Employees would exceed the
limitation. If the limitation would be exceeded for a Plan Year, before the
close of the following Plan Year (a) the amount of Excess 401(k) Contributions
for that Plan Year (and any income allocable to those Contributions as
calculated in the specific manner required by Section 4.20) shall be
distributed, or (b) the Employer may make a Qualified Nonelective Employer
Contribution which it elects to have treated as a Section 401(k) Contribution.

         The amount of Excess 401(k) Contributions to be distributed shall be
that amount of the Salary Deferral Contributions by or on behalf of those Highly
Compensated Employees with the largest Salary Deferral Contributions as is equal
to the Excess 401(k) Contributions, taken ratably from each Account, based
solely on those Salary Deferral Contributions for the Plan Year. This initial
distribution shall not reduce those Accounts affected below the next highest
level of Salary Deferral Contributions. If any further reduction is necessary
the same process is to be repeated at the next highest level of Salary Deferral
Contributions by or on behalf of the Highly Compensated Employees, and if
necessary repeated in successively lower levels of Salary Deferral Contributions
until the cash or deferred arrangement satisfies the Actual Deferral Percentage
test.




                                      IV-8
<PAGE>   30

         The amount of Excess 401(k) Contributions to be distributed shall be
determined in the following manner:

         First, the Plan will determine how much Actual Deferral Ratio of the
Highly Compensated Employee with the highest Actual Deferral Ratio would have to
be reduced to satisfy the Actual Deferral Percentage Test or cause such ratio to
equal the Actual Deferral Ratio of the Highly Compensated Employee with the next
highest ratio. Second, this process is repeated until the Actual Deferral
Percentage Test is satisfied. The amount of Excess 401(k) Contributions is equal
to the sum of these hypothetical reductions multiplied, in each case, by the
Highly Compensated Employee's Annual Compensation.

         Then, distributions of Excess 401(k) Contributions shall be made on the
basis of the respective amounts attributable to each Highly Compensated
Employee. The Highly Compensated Employees subject to the actual distribution
are determined using the "dollar leveling method" starting with the Highly
Compensated Employee with the greatest dollar amount of Salary Deferral
Contributions and other contributions treated as Section 401(k) Contributions
for the Plan Year and continuing until the amount of the Excess 401(k)
Contributions have been accounted for.

         Qualified Nonelective Employer Contributions shall be treated as
Section 401(k) Contributions only if: (a) the conditions described in Regulation
section 1.401(k)-1(b)(5) are satisfied and (b) they are allocated to Members'
Accounts as of a date within that Plan Year and are actually paid to the Trust
no later than the end of the 12 month period immediately following the Plan Year
to which the contributions relate. If the Employer makes a Qualified Nonelective
Employer Contribution that it elects to have treated as a Section 401(k)
Contribution, the Contribution will be in an amount necessary to satisfy the
Actual Deferral Percentage test and will be allocated first to those Non-Highly
Compensated Employees who had the lowest Actual Deferral Ratio.

         Any distributions of the Excess 401(k) Contributions for any Plan Year
are to be made to Highly Compensated Employees on the basis of the amount of
contributions by, or on behalf of, each Highly Compensated Employee. The amount
of Excess 401(k) Contributions to be distributed for any Plan Year must be
reduced by any excess Salary Deferral Contributions previously distributed for
the taxable year ending in the same Plan Year.

         4.18 CONTRIBUTION PERCENTAGE FAIL SAFE. If the limitation would be
exceeded for any Plan Year, before the close of the following Plan Year any one
or more of the following corrective actions shall be taken, as determined by the
Committee in its sole discretion: (a) the amount of the Excess Aggregate 401(m)
Contributions for that Plan Year (and any income allocable to those
Contributions as calculated in the specific manner required by Section 4.20)
shall be distributed or forfeited (to the extent not vested), or (b) the
Employer may make a Qualified Nonelective Employer Contribution which it elects
to have treated as a Section 401(m) Contribution. Any distributions of the
Excess Aggregate 401(m) Contributions for any Plan Year are to be made to Highly
Compensated Employees on the basis of the respective portions of the amounts
attributable to each of them. Forfeitures of Excess Aggregate 401(m)
Contributions may not be allocated to Members whose contributions are reduced
under this Section.




                                      IV-9
<PAGE>   31

         The amount of Excess Aggregate 401(m) Contributions to be distributed
shall be determined in the following manner:

         First, the Plan will determine how much Actual Contribution Ratio of
the Highly Compensated Employee with the highest Actual Contribution Ratio would
have to be reduced to satisfy the Actual Contribution Percentage Test or cause
such ratio to equal the Actual Contribution Ratio of the Highly Compensated
Employee with the next highest ratio. Second, this process is repeated until the
Actual Contribution Percentage Test is satisfied. The amount of Excess Aggregate
401(m) Contributions is equal to the sum of these hypothetical reductions
multiplied, in each case, by the Highly Compensated Employee's Annual
Compensation.

         Then, distributions of Excess Aggregate 401(m) Contributions shall be
made on the basis of the respective amounts attributable to each Highly
Compensated Employee. The Highly Compensated Employees subject to the actual
distribution are determined using the "dollar leveling method" starting with the
Highly Compensated Employee with the greatest dollar amount of Employer Matching
Contributions and other contributions treated as matching contributions for the
Plan Year and continuing until the amount of the Excess Aggregate 401(m)
Contributions have been accounted for.

         4.19 ALTERNATIVE LIMITATION FAIL SAFE. As soon as practicable after the
close of each Plan Year, the Committee shall determine whether the alternative
limitation would be exceeded. If the limitation would be exceeded for any Plan
Year, before the close of the following Plan Year the Actual Deferral Percentage
or Contribution Percentage of the eligible Highly Compensated Employees, or a
combination of both, shall be reduced by distributions made in the manner
described in the Regulations. These distributions shall be in addition to and
not in lieu of distributions required for Excess 401(k) Contributions and Excess
Aggregate 401(m) Contributions.

         4.20 INCOME ALLOCABLE TO EXCESS 401(k) AND AGGREGATE 401(m)
CONTRIBUTIONS. The income allocable to Excess 401(k) Contributions for the Plan
Year shall be determined by multiplying the income for the Plan Year allocable
to Section 401(k) Contributions by a fraction. The numerator of the fraction is
the amount of Excess 401(k) Contributions made on behalf of the Member for the
Plan Year. The denominator of the fraction is the Member's total Account balance
attributable to Section 401(k) Contributions as of the beginning of the Plan
Year plus the Member's Section 401(k) Contributions for the Plan Year. The
income allocable to Excess Aggregate 401(m) Contributions for a Plan Year shall
be determined by multiplying the income for the Plan Year allocable to Section
401(m) Contributions by a fraction. The numerator of the fraction is the amount
of Excess Aggregate 401(m) Contributions made on behalf of the Member for the
Plan Year. The denominator of the fraction is the Member's total Account balance
attributable to Section 401(m) Contributions as of the beginning of the Plan
Year plus the Member's Section 401(m) Contributions for the Plan Year.

         4.21 RETURN OF CONTRIBUTIONS FOR MISTAKE, DISQUALIFICATION OR
DISALLOWANCE OF DEDUCTION. Subject to the limitations of section 415 of the
Code, the assets of the Trust shall not revert to any Employer or be used for
any purpose other than the exclusive benefit of the Members and their
Beneficiaries and the reasonable expenses of administering the Plan except:




                                     IV-10
<PAGE>   32

                  (a) any Contribution made because of a mistake of fact shall
         be repaid to the Employer within one year after the payment of the
         Contribution;

                  (b) any Contribution conditioned upon the Plan's initial
         qualification under section 401 of the Code or the initial
         qualification of an Employer's adoption of the Plan, if later, shall be
         repaid to the Employer within one year after the date of denial of the
         initial qualification of the Plan or of its adoption by the Employer;
         and

                  (c) any and all Employer Contributions are conditioned upon
         their deductibility under section 404 of the Code; therefore, to the
         extent the deduction is disallowed, the Contributions shall be repaid
         to the Employer within one year after the disallowance.

         The Employer has the exclusive right to determine if a Contribution or
any part of it is to be repaid or is to remain as a part of the Trust Fund
except that the amount to be repaid is limited, if the Contribution is made by
mistake of fact or if the deduction for the Contribution is disallowed, to the
excess of the amount contributed over the amount that would have been
contributed had there been no mistake or over the amount disallowed. Earnings
which are attributable to any excess contribution cannot be repaid. Losses
attributable to an excess contribution must reduce the amount that may be
repaid. All repayments of mistaken Contributions or Contributions which are
disallowed are limited so that the balance in a Member's Account cannot be
reduced to less than the balance that would have been in the Member's Account
had the mistaken amount or the amount disallowed never been contributed.




                                     IV-11
<PAGE>   33

                                   ARTICLE V

                                  PARTICIPATION

                              PART A.  ALLOCATIONS

         5.1 ALLOCATION OF EMPLOYEE CONTRIBUTIONS. The Committee shall allocate
each Member's Employee After Tax Contributions made on his behalf to his
Employee After Tax Contribution Account as of the date they are contributed.

         5.2 ALLOCATION OF ROLLOVER CONTRIBUTIONS AND DIRECT TRANSFERS. If
Rollover Contributions and/or direct transfers are permitted, the Committee
shall allocate each Member's Rollover Contribution and/or direct transfers to
his Rollover Account as of the date it is contributed or transferred.

         5.3 ALLOCATION OF SALARY DEFERRAL CONTRIBUTIONS. The Committee shall
allocate the Salary Deferral Contributions, if any, made on behalf of each
Member to his Salary Deferral Contribution Account, as of the date they are
contributed.

         5.4 ALLOCATION OF EMPLOYER MATCHING CONTRIBUTIONS. The Committee shall,
as of the end of each month, allocate the Employer Matching Contributions made
on behalf of each Member to his Employer Matching Contribution Account.

         5.5 ALLOCATION OF EMPLOYER DISCRETIONARY CONTRIBUTIONS. The Committee
shall, as of the end of each Plan Year, allocate the Employer Discretionary
Contribution, if any, among the Members who are eligible to participate and who
are employed by an Employer or Affiliated Employer at the end of the Plan Year
based upon each Member's Considered Compensation as compared to the Considered
Compensation of all Members eligible to participate and who are employed by an
Employer or Affiliated Employer at the end of the Plan Year.

         5.6 ALLOCATION OF RESTORATION CONTRIBUTIONS. The Committee shall, as of
the end of each Plan Year, allocate the previously unapplied and unallocated
forfeitures and the Employer Contribution, if any, which are required to restore
the nonvested portion of the Employer Accounts of Members who had previously
forfeited that nonvested portion on the date they terminated employment but who
qualified for the restoration of that amount during the Plan Year and allocate
the previously unapplied and unallocated forfeitures and the Employer
Contribution, if any, which are required to restore the Accounts of those
Members whose distributions were forfeited because of the Committee's inability
to contact the Members previously but who have filed a claim for their Accounts
during the Plan Year. The Committee shall establish and maintain a separate
subaccount for the amount allocated to an Account in order to restore a
previously forfeited amount.

         5.7 ALLOCATION OF QUALIFIED NONELECTIVE EMPLOYER CONTRIBUTIONS. The
Committee shall, as of the end of the Plan Year, allocate the Qualified
Nonelective Employer Contribution, if any, among the Non-Highly Compensated
Employees as set forth in Section 4.17 or 4.18, whichever is applicable.




                                      V-1
<PAGE>   34

         5.8 ALLOCATION OF TOP-HEAVY CONTRIBUTIONS. The Committee shall, as of
the end of the Plan Year, allocate the Employer Contribution, if any, which is
necessary to fulfill the Top-Heavy Plan requirements found in Article IX if the
Plan is determined to be a Top-Heavy Plan.

         5.9 EFFECT OF TRANSFERS UPON ALLOCATIONS. If a Member has been
Transferred during the Plan Year, the Member shall be entitled to have allocated
to him a portion of the Employer Matching Contribution based upon his Salary
Deferral Contributions made while he was an Employee of each Employer and the
Employer Discretionary Contribution based upon his Considered Compensation for
the Plan Year earned from all of the Employers for which an Employer
Discretionary Contribution was made.

         5.10 APPLICATION OF FORFEITURES. Amounts forfeited for any reason shall
first be allocated under Section 5.6 to restore previously forfeited Accounts
which are to be restored under the terms of this Plan and if any amount remains
after that allocation, it shall be used to reduce the Employer Matching
Contribution for that Plan Year.

         5.11 SCHEDULED ALLOCATION OF INCOME OR LOSSES AND APPRECIATION OR
DEPRECIATION. The Trustee shall value the Trust Fund on its Valuation Date at
its then fair market value, but without regard to any Contributions made to the
Plan after the preceding Valuation Date, shall determine the amount of income
earned or losses suffered by the Trust Fund and shall determine the appreciation
or depreciation of the Trust Fund since the preceding Valuation Date. The
Committee shall then allocate as of the Valuation Date the income earned or
losses suffered and the appreciation or depreciation in the assets of the Trust
Fund for the period since the last preceding Valuation Date. The allocation
shall be among the Members and former Members who have undistributed Account
balances based upon their Account balances in each of the various investment
funds or accounts, if more than one, as of the last Valuation Date reduced, as
appropriate, by amounts used from the investment fund or account to make a
withdrawal or distribution or any other transaction which is properly chargeable
to the Member's Account during the period since the last Valuation Date. The
Committee, by resolution, may elect in lieu of the allocation method described
above to use a unit allocation method, a separate account method or any other
equitable method if it announces the method of allocation to the Members prior
to the beginning of the period during which it is first used.

         5.12 INTERIM ALLOCATION OF INCOME OR LOSSES AND APPRECIATION OR
DEPRECIATION. If at any time in the interval between Valuation Dates, one or
more withdrawals or one or more distributions are to be made and the Committee
determines that an interim allocation is necessary to prevent discrimination
against those Members and former Members who are not receiving funds, the
Trustee is to perform a valuation of a portion or all of the Trust Fund as of a
date selected by the Committee which is administratively practical and near the
date of withdrawals or distributions in the same manner as it would if it were a
scheduled Valuation Date. That date may be before or after any particular
distribution or withdrawal. The Committee shall then allocate as of that date
any income or loss and any appreciation or depreciation to the various Accounts
of each of the Members in the same manner as it would if it were a scheduled
Valuation Date. Then without regard to the language in Section 6.1, all
withdrawals or distributions made after that date and prior to the next
Valuation Date, even though the event



                                      V-2
<PAGE>   35

causing it occurred earlier, shall be based upon the Accounts as adjusted by the
interim valuation.

                         PART B.  LIMITATION ALLOCATIONS

         The Annual Additions that may be credited to an individual Member's
Accounts under this Plan and any other qualified defined contribution plan
maintained by an Affiliated Employer for a Limitation Year shall not exceed the
lesser of (a) $30,000.00 (as adjusted by the Secretary of Treasury), or (b) 25%
of the Member's Annual Compensation for the Limitation Year. The Plan will be
operated in compliance with section 415 of the Code and its Regulations, the
terms of which are incorporated in this Plan.

         If Annual Additions are made in excess of the limitations contained in
this Part B, to the maximum extent permitted by law, those excess Annual
Additions shall be attributed to this Plan.

         If an excess Annual Addition attributed to this Plan is held or
contributed as a result of the application of forfeitures, reasonable error in
estimating a Member's Annual Compensation, reasonable error in calculating the
maximum Salary Deferral Contribution that may be made for a Member under section
415 of the Code or because of other facts and circumstances which the
Commissioner of Internal Revenue finds to be justified, the excess Annual
Addition shall be corrected as follows:

                  (a) first, the excess Annual Addition shall be reduced to the
         extent necessary by distributing to the Member all Employee After Tax
         Contributions, if any, and then Salary Deferral Contributions together
         with their earnings. These distributed amounts are disregarded for
         purposes of the testing and limitations contained in Article IV;

                  (b) second, if the Member is still employed by the Employer at
         the end of the Plan Year, any remaining excess funds shall be placed in
         an unallocated suspense account to be applied to reduce future Employer
         Contributions for that Member for as many Plan Years as are necessary
         to exhaust the suspense account in keeping with the amounts which would
         otherwise be allocated to that Member's Account; and

                  (c) third, if the Member is not employed by the Employer at
         the end of the Plan Year, the remaining excess funds shall be placed in
         an unallocated suspense account to reduce future Employer Contributions
         for all remaining Members for as many Plan Years as are necessary to
         exhaust the suspense account.

         If the Plan terminates prior to the exhaustion of the suspense account,
the remaining amount shall revert to the Employer.

                       PART C.  INVESTMENT OF TRUST FUNDS

         The Committee may: (a) maintain commingled and/or separate Trusts, (b)
establish separate investment funds and/or (c) permit individual investments,
some or all of which are directed by the Committee or selected by the Members or
former Members for any portion or all of their Accounts. Once the Committee has
selected or changed the mode of investments, it shall



                                      V-3
<PAGE>   36

establish rules pertaining to its administration, including but not limited to:
selection of forms, rules for making selections effective, establishing the
frequency of permitted changes, the minimum percentage in any investment, and
all other necessary or appropriate regulations.

         The Committee may direct the Trustee to hold funds in cash or near
money awaiting investment or to sell assets and hold the proceeds in cash or
near money awaiting reinvestment when establishing, using or changing investment
modes. For this purpose the funds may be held in cash or invested in short term
investments such as certificates of deposit, U.S. Treasury bills, savings
accounts, commercial paper, demand notes, money market funds, any common, pooled
or collective funds which the Trustee or any other corporation may now have or
in the future may adopt for short term investments and any other similar assets
which may be offered by the federal government, national or state banks (whether
or not serving as Trustee) or any savings and loan association.




                                      V-4
<PAGE>   37

                                   ARTICLE VI

                          DISTRIBUTIONS AND FORFEITURES

                             PART A.  DISTRIBUTIONS

         6.1 VALUATION OF ACCOUNTS FOR DISTRIBUTIONS. For the purpose of making
a distribution, a Member's Accounts shall be his Accounts as valued as of the
Valuation Date which is coincident with or next preceding the event which caused
the distribution, adjusted only for Contributions, distributions and
withdrawals, if any, made between the Valuation Date and that event.

         6.2 DISTRIBUTION ON DEATH. If a Member or Retired Member dies, the
Member's spouse or designated Beneficiary or Beneficiaries is entitled to
receive 100% of the remaining amount in all of his Accounts as of the day he
dies. Each Member has the right to designate and to revoke the designation of
his Beneficiary or Beneficiaries. Each designation or revocation must be
evidenced by a written document in the form required by the Committee, signed by
the Member and filed with the Committee. If no designation is on file at the
time of a Member's death or if the Committee determines that the designation is
ineffective, the designated Beneficiary shall be the Member's spouse, if living,
or if not, the executor, administrator or other personal representative for
administration and distribution as part of the Member's estate.

         If a Member is considered to be married under local law, the Member's
designation of any Beneficiary, other than the Member's spouse, shall not be
valid unless the spouse acknowledges in writing that he or she understands the
effect of the Member's beneficiary designation and consents to it. The consent
must be to a specific Beneficiary. The written acknowledgment and consent must
be filed with the Committee, signed by the spouse, and witnessed by a Plan
representative or a notary public. However, if the spouse cannot be located or
there exist other circumstances as described in sections 401(a)(11) and
417(a)(2) of the Code, the requirement of the Member's spouse's acknowledgment
and consent may be waived.

         6.3 DISTRIBUTION ON RETIREMENT. A Member may retire at any time on or
after he attains his Retirement Age. If a Member retires, he is entitled to
receive 100% of all of his Accounts as of the day he retires.

         6.4 DISTRIBUTION ON DISABILITY. If a Member's employment with an
Employer is terminated and the Committee determines he is suffering from a
Disability, he is entitled to receive 100% of all of his Accounts as of the day
he terminated because of his Disability.

         6.5 DISTRIBUTION ON SEVERANCE FROM SERVICE. If a Member Severs Service
with all Affiliated Employers for any reason other than death, retirement, or
disability, he is entitled to receive 100% of all his Accounts under the Plan.
Notwithstanding the above, effective solely for Contributions made to the Plan
on or after January 1, 2000, if a Member Severs Service with all Affiliated
Employers for any reason other than death, retirement or disability, he is
entitled to receive (a) 100% of all of his Accounts, except his Employer
Matching Contribution Account and his Employer Discretionary Contribution
Account, if any, and (b) that percentage of his




                                      VI-1
<PAGE>   38

Employer Matching Contribution Account and his Employer Discretionary
Contribution Account, if any, as shown in the vesting schedule below, as of the
day he severs employment.

<TABLE>
<CAPTION>
                                                                     PERCENTAGE OF AMOUNT VESTED IN ACCOUNTS
                                                                           CONTAINING EMPLOYER MATCHING
COMPLETED YEARS OF ACTIVE SERVICE                                        AND DISCRETIONARY CONTRIBUTIONS
---------------------------------                                        -------------------------------
<S>                                                                      <C>
         Less than one year.....................................................        0%
         One year but less than two years.......................................       20%
         Two years but less than three years....................................       40%
         Three years but less than four years...................................       60%
         Four years but less than five years....................................       80%
         Five years or more.....................................................      100%
</TABLE>

         6.6 DISTRIBUTION ON ISSUANCE OF A QUALIFIED DOMESTIC RELATIONS ORDER.
If the Committee determines that a judgment, decree or order relating to child
support, alimony payments or marital property rights of the spouse, former
spouse, child or other dependent of the Member is a qualified domestic relations
order which complies with a state's domestic relations law or community property
law and section 414(p) of the Code or is a domestic relations order entered
before January 1, 1985, the Committee may direct the Trustee to distribute the
awarded property to the person named in the award but only in the manner
permitted under this Plan. To be a qualified domestic relations order, the order
must clearly specify: (a) the name and last known mailing address of the Member
and each alternate payee under the order, (b) the amount or percentage of the
Member's benefits to be paid from the Plan to each alternate payee or the manner
in which the amount or percentage can be determined, (c) the number of payments
or periods for which the order applies, (d) the plan to which the order applies,
and (e) all other requirements set forth in section 414(p) of the Code. If a
distribution is made at a time when the Member is not fully vested, a separate
subaccount shall be created for the remaining portion of each Account which was
not fully vested. That subaccount shall then remain frozen: that is, no further
contributions nor any forfeitures shall be allocated to the subaccount; however,
it shall receive its proportionate share of trust appreciation or depreciation
and income earned on or losses incurred by the Trust Fund. To determine the
Member's vested interest in each subaccount at any future time, the Committee
shall add back to the subaccount at that time the amount that was previously
distributed under the qualified domestic relations order, shall multiply the
reconstituted subaccount by the vesting percentage, and shall then subtract the
amount that was previously distributed. The remaining amount is the Member's
vested interest in the subaccount at that time.

         6.7 FORFEITURE ON SEVERING SERVICE WITH ALL AFFILIATED EMPLOYERS. If as
a result of Severing Service with all Affiliated Employers a former Member
receives a distribution of his entire vested interest in his Account, the
nonvested amount in his Account is immediately forfeited. A former Member who
received no distribution upon his Severing Service with all Affiliated Employers
because he had no vested interest shall be treated as if he received a
distribution of his entire vested interest and that interest was less than
$5,000.00.

         If a former Member who has a vested interest in his Account received no
distribution or a distribution of less than the full amount of his entire vested
interest as a result of his Severing



                                      VI-2
<PAGE>   39

Service with all Affiliated Employers the nonvested amount in his Account is
immediately forfeited following five consecutive one-year Periods of Severance.

         A distribution shall be treated as if it were made as a result of
Severing Service with all Affiliated Employers if it is made not later than the
end of the second Plan Year following the Plan Year in which the former Member
Severs Service.

         6.8 FORFEITURE BY LOST MEMBERS OR BENEFICIARIES; ESCHEAT. If a person
who is entitled to a distribution cannot be located during a search period of 60
days after the Trustee has initially attempted making payment, that person's
Account shall be forfeited. However, if at any time prior to the termination of
this Plan and the complete distribution of the Trust Fund, the Former Member or
Beneficiary files a claim with the Committee for the forfeited benefit, that
benefit shall be reinstated (without adjustment for trust income or losses
during the forfeited period) effective as of the date of the receipt of the
claim. As soon as appropriate following the Employer's Contribution of the
reinstated amount, it shall be paid to the former Member or Beneficiary in a
single sum.

               PART B.  FORM, ADJUSTMENTS AND TIME OF DISTRIBUTION

         6.9 QUALIFIED JOINT AND SURVIVOR AND QUALIFIED PRERETIREMENT SURVIVOR
ANNUITY. Each Member (a) who is married to the same spouse throughout the one
year period ending on the earlier of (i) the Member's Annuity Starting Date, or
(ii) the date of the Member's death, (b) who has a vested Account balance in
excess of $5,000.00 will be paid in the form of a Qualified Joint and Survivor
Annuity, unless he and his spouse make a valid election out of this form of
payment. Payments under the Qualified Joint and Survivor Annuity will begin
immediately on the Member's Annuity Starting Date. If the Member marries within
one year of the first day of the first period for which amounts are received as
an annuity by the Member, and the Member and his spouse have been continuously
married for at least a one-year period ending on or before the date of the
Member's death, the Member and his spouse will be treated as having been married
throughout the one-year period ending on the Member's Annuity Starting Date.

         If a married Member who qualifies for a Qualified Joint and Survivor
Annuity dies before the Annuity Starting Date, a Qualified Preretirement
Survivor Annuity in an amount not less than 50% of the Member's nonforfeitable
Account balance, including the proceeds of insurance, if any, on the Member's
life, as of the date of the Member's death will be paid to his surviving spouse,
unless the Member and his surviving spouse elect to receive a lump sum payment.
The Member's surviving spouse may direct that payments under the Qualified
Preretirement Survivor Annuity begin within a reasonable time after the Member's
death.

         Each Member, with the consent of his spouse, may elect at any time, and
any number of times, during the 90 day period ending on the Member's Annuity
Starting Date, to waive the Qualified Joint and Survivor Annuity or may revoke
that election. Also a Member, with the consent of his spouse, may elect, at any
time, and any number of times, during the period which begins on the first day
of the Plan Year in which the Member attains age 35 and ends on the date of the
Member's death, to waive the Qualified Preretirement Survivor Annuity or may
revoke that election. If a Member has terminated employment with the Employer
and all Affiliated Employers, his election period will not begin later than the
date the former Member terminated



                                      VI-3
<PAGE>   40

employment. A Member's waiver of the Qualified Joint and Survivor Annuity or
Qualified Preretirement Survivor Annuity must state the specific nonspouse
Beneficiary, including any class of Beneficiaries or any contingent
Beneficiaries, who will receive the Member's benefits. A Member's waiver of the
Qualified Joint and Survivor Annuity must specify the particular optional form
of benefit selected.

         A Member's waiver of the Qualified Joint and Survivor Annuity or the
Qualified Preretirement Survivor Annuity will not be effective unless the
Member's spouse signs either a specific or a general consent to the Member's
waiver.

         A specific spousal consent must be in writing, consent to the Member's
waiver, consent to the specific nonspouse Beneficiary designated by the Member
to receive Plan benefits, acknowledge the form of payment, acknowledge the
effect of the spouse's consent to the Member's waiver and be witnessed by a
notary public or a Plan representative.

         A general spousal consent must be in writing; consent to the Member's
waiver; specify that the Member may change (a) the optional form of benefit
elected by him, (b) the Beneficiary designated by him to receive Plan benefits
in the event of his death or (c) both, without any requirement of further
consent by the spouse; acknowledge that the spouse has the right to limit
consent to a specific Beneficiary and a particular optional form of benefit;
specify that the spouse voluntarily elects to relinquish the right to limit
consent to a specific Beneficiary, a specific optional form of benefit or both;
acknowledge the effect of the spouse's consent to the Member's waiver; and be
witnessed by a notary public or a Plan representative.

         The Member's election to waive the Qualified Joint and Survivor Annuity
and/or Qualified Preretirement Survivor Annuity will be effective if it is
established to the satisfaction of the Employer that the spousal consent
ordinarily required can not be obtained because there is no spouse, the spouse
cannot be located, or there exist other circumstances which obviate the
necessity of obtaining the spousal consent. Any consent by the Member's spouse,
or establishment that the consent of the Member's spouse can not be obtained,
will be effective only to that spouse.

         During a period that is no less than 30 days, unless waived, and no
more than 90 days before the Member's Annuity Starting Date, each Member is to
receive the following information written in nontechnical language: a general
description and explanation of the terms and conditions of the Qualified Joint
and Survivor Annuity, an explanation of the eligibility conditions and other
material features and of the forms of distribution available, sufficient
information to explain the relative values of the forms of distribution
available, the circumstances under which the Qualified Joint and Survivor
Annuity will be provided unless the Member elects to waive that form, a general
explanation of the Member's right to elect to waive the Qualified Joint and
Survivor Annuity form of benefit and the effect of a waiver, the right of the
Member's spouse to consent or not to consent to a waiver, a general explanation
of the Member's right to revoke an election to waive the Qualified Joint and
Survivor Annuity and the effect of a revocation, and the Member's right to
request a written explanation of the financial effect upon his benefit of
electing to waive the Qualified Joint and Survivor Annuity. Similarly, within
the period beginning on the first day of the Plan Year in which a Member attains
age 32 and ending with the close of the Plan Year preceding the Plan Year in
which the Member attains



                                      VI-4
<PAGE>   41

age 35, or within the one year period that starts on the date that the Member
becomes a Member, or within the one year period that starts on the date that the
Member severs Service if the Member severs before attaining age 35, whichever
period ends last, each Member is to receive a written explanation with respect
to the Qualified Preretirement Survivor Annuity comparable to that required for
the Qualified Joint and Survivor Annuity.

         The 30 day waiting period provided in the preceding paragraph may be
waived by the Member affirmatively waiving the waiting period in a manner that
satisfies the applicable Regulation but that waiver will not affect the
requirement that the information required by this Section be provided the Member
no more than 90 days before his Annuity Starting Date.

         If a Member is single on the earlier of the Member's Annuity Starting
Date or the date of the Member's death and has a vested right to any portion of
his Account balance in excess of $5,000.00 as determined under Section 6.12, his
benefit payable for any reason other than the Member's death will be paid in the
form of a single life only annuity unless the Member elects the form of
distribution described in the next Section. If a Member who qualifies for a
single life only annuity dies before his Annuity Starting Date, a single sum in
cash equal to the amount in the Member's Account will be paid to his designated
Beneficiary. The waiver periods and information to be provided single Members
are the same as those to be provided the married Members.

         If a Member's vested Account balance plus all prior Plan distributions
to the Member does not exceed $5,000.00, then in lieu of providing a Qualified
Joint and Survivor Annuity or Qualified Preretirement Survivor Annuity or a
single life only annuity, whichever is applicable, the Member's vested Account
balance will be distributed in a single lump sum payment in cash within one year
after the Member becomes entitled to the distribution. However, if the
distribution is to be made after the Member's Annuity Starting Date, the single
sum distribution will not be made unless the Member or in the event the Member
is married, the Member and his spouse, or if the Member has died, the deceased
Member's surviving spouse, consent in writing to the distribution.

         6.10 FORM OF DISTRIBUTIONS. Distributions shall be made only in cash
unless an asset held in the Trust cannot be sold by distribution date or can
only be sold at less than its appraised value, in which event part or all of the
distribution may be made in kind. If the Qualified Joint and Survivor Annuity or
the Qualified Preretirement Survivor Annuity, whichever is applicable, is
properly waived, distribution shall be made in one lump sum payment or, as a
Direct Rollover if the Distributee elects, at the time and in the manner
prescribed by the Committee, to have any portion or all of the Eligible Rollover
Distribution paid directly to an Eligible Retirement Plan named by the
Distributee.

         Each Member who was a participant in the Somerset Oil & Gas Company,
Inc. 401(k) Plan (the "Somerset Plan") may, in addition to the distribution
options listed above, have the balance of their Account transferred from the
Somerset Plan paid in equal monthly or quarterly installments for a period of
time not to exceed the shorter of 10 years or the life expectancy of the Member
or the joint life and last survivor expectancy of the Member and the Member's
designated Beneficiary. The term certain must be of a duration for which it is
expected that more than 50% of the present value of the Member's accrued benefit
shall be paid to the Member. The



                                      VI-5
<PAGE>   42

Member's Account from which the installments are payable shall be maintained as
a part of the general Trust Fund. The income earned on the Account shall be
distributed not less often than annually.

         Notwithstanding any other provision of the Plan to the contrary,
effective for Members with Annuity Starting Dates occurring after the earlier of
(1) January 1, 2003 or (2) the 90th day following the date Members have been
furnished with a summary of material modifications satisfying the requirements
of 29 C.F.R. Section 2520.104b-3, distributions under the Plan shall be made
solely in the form of a single lump-sum payment in cash or as a Direct Rollover
if the Distributee elects, at the time and in the manner prescribed by the
Committee, to have any portion or all of the Eligible Rollover Distribution paid
directly to an Eligible Retirement Plan named by the Distributee.

         6.11 ADJUSTMENT OF VALUE OF DISTRIBUTION. Any Account held for
distribution past one or more Valuation Dates shall continue to share in the
appreciation or depreciation of the Trust Fund and in the income earned or
losses incurred by the Trust Fund until the last Valuation Date which occurs
with or next precedes the date distribution is made.

         6.12 NORMAL TIME FOR DISTRIBUTION. The following rules shall normally
govern the time for distribution unless Section 6.13 requires an earlier
distribution. If the benefit to be distributed to the Member is or is deemed to
be $5,000.00 or less, the benefit should be distributed within one year after
the Member becomes entitled to the benefit. Also, if it is or is deemed to be
greater than $5,000.00 and the Member consents to the distribution, the benefit
should be distributed or begin to be distributed within one year after the
Member becomes entitled to the benefit. If, however, the benefit to be
distributed is or is deemed to be greater than $5,000.00 and the Member fails to
consent to the distribution, the distribution shall not be made without the
Member's consent until he attains normal Retirement Age or age 62, whichever is
later.

         6.13 TIME LIMIT FOR DISTRIBUTION. All distributions must comply with
sections 401(a)(9) and 401(a)(14) of the Code and their regulations. Thus, the
distribution must be made no later than the EARLIER of the date required by
subsection (a) or (b) if the Member has not died.

                  (a) Section 401(a)(9): Each Member must begin receiving a
         distribution under the Plan on or before April 1st of the calendar year
         following the later of the calendar year in which the Member retires or
         attains age 70 1/2 in the amount required by section 401(a)(9) of the
         Code and its Regulations. However, if the Member is a Five Percent
         Owner in the Plan Year ending in the calendar year in which he attains
         70 1/2, distribution must begin April 1st of the following calendar
         year regardless of whether he remains employed by the Employer or an
         Affiliated Employer. Without regard to the above rules, if a Member
         made a designation before January 1, 1984, which complied with section
         401(a)(9) of the Code before its amendment by the Tax Reform Act of
         1984, the distribution does not have to be made until the time
         described in the designation, if later.




                                      VI-6
<PAGE>   43

                  With respect to distributions under the Plan made for calendar
         years beginning on or after January 1, 2001, the Plan will apply the
         minimum distribution requirements of section 401(a)(9) of the Code in
         accordance with Regulations under section 401(a)(9) that were proposed
         on January 17, 2001, notwithstanding any provision of the Plan to the
         contrary. This amendment shall continue in effect until the end of the
         last calendar year beginning before the effective date of the final
         regulations under section 401(a)(9) or such other date as may be
         specified in guidance published by the Internal Revenue Service.

                  (b) Section 401(a)(14): The distribution must be made to the
         Member on or before the 60th day after the latest of the end of the
         Plan Year in which the Member attains his Retirement Age, attains the
         10th anniversary of the year in which he began participation or
         terminates employment with all Affiliated Employers unless the Member
         consents to a later time.

         If the Member has died and benefits are being paid in installments and
the Member dies after benefit payments have begun, the balance must be
distributed at least as rapidly as the installment method chosen by the Member.
If the Member dies prior to the beginning of installments his entire Account
must be distributed within five years after his death. However, if a portion of
the Member's Account is payable to a designated Beneficiary, that part may be
paid in installments over a period not exceeding the life expectancy of the
Beneficiary. Those payments must begin not later than one year after the
Member's death. If the surviving spouse is the Beneficiary, the payments may be
delayed so as to begin on the date on which the Member would have attained age
70 1/2. If payment is postponed and the surviving spouse dies before payments
begin, the surviving spouse shall be treated as the Member for purposes of this
paragraph.

         6.14 PROTECTED BENEFITS. No provision of this Plan shall reduce or
eliminate any benefit protected by section 411(d)(6) of the Code, except as
otherwise may be permitted or required by law.




                                      VI-7
<PAGE>   44

                                  ARTICLE VII

                              WITHDRAWALS AND LOANS

         7.1 VALUATION OF ACCOUNTS FOR WITHDRAWALS AND LOANS. For the purpose of
withdrawals and loans, a Member's Account shall be his Accounts as valued as of
the Valuation Date which is coincident with or next preceding the request for
the withdrawal or loan adjusted only for Contributions, distributions,
withdrawals and loans, if any, made between the Valuation Date and that event.

         7.2 WITHDRAWALS OF EMPLOYEE AFTER TAX AND ROLLOVER ACCOUNTS. A Member
is entitled at any time to receive a withdrawal from his Employee After Tax
Contribution and/or Rollover Account after giving 10 days written notice to the
Committee. The withdrawal cannot be more than the balance of the Account. The
Member's withdrawal request for his Employee After Tax Contributions terminates
his right to make any Employee After Tax Contributions until the next time
Employee After Tax Contributions are permitted after the lapse of one year
following the withdrawal and his timely filing of a written request to resume
Contributions. Each withdrawal of Employee After Tax Contributions shall include
a pro rata share of income earned on those Contributions.

         7.3 WITHDRAWAL FOR FINANCIAL HARDSHIP. A Member is entitled to receive
a withdrawal from his Salary Deferral Contribution Account (exclusive of income
earned) in the event of an immediate and heavy financial need incurred by the
Member and the Committee's determination that the withdrawal is necessary to
alleviate that hardship. Notwithstanding the above, each Member who was a
participant in the Somerset Plan shall be entitled to receive a hardship
withdrawal in accordance with the provisions of this Section 7.3 from the vested
portion of all their Accounts that were transferred to the Plan from the
Somerset Plan.

                  (a) Approval Reasons for Hardship: A distribution shall be
         made on account of financial hardship only if the distribution is for:
         (i) expenses for medical care described in section 213(d) of the Code
         previously incurred by the Member, the Member's spouse, or any
         dependents of the Member (as defined in section 152 of the Code) or
         necessary for these persons to obtain medical care described in section
         213(d) of the Code, (ii) costs directly related to the purchase
         (excluding mortgage payments) of a principal residence for the Member,
         (iii) payment of tuition, related educational fees and room and board
         expenses, for the next 12 months of post-secondary education for the
         Member, his or her spouse, children, or dependents (as defined in
         section 152 of the Code), (iv) payments necessary to prevent the
         eviction of the Member from his principal residence or foreclosure on
         the mortgage of the Member's principal residence, or (v) any other
         event added to this list by the Commissioner of Internal Revenue.

                  (b) Maximum Distribution Permitted: A distribution to satisfy
         an immediate and heavy financial need shall not be made in excess of
         the amount of the immediate and heavy financial need of the Member and
         the Member must have obtained all distributions, other than hardship
         distributions, and all nontaxable (at the time of the loan) loans
         currently available under all plans maintained by the Employer. The
         amount of a Member's immediate and heavy financial need includes any
         amounts necessary to pay



                                     VIII-1
<PAGE>   45

         any federal, state or local income taxes or penalties reasonably
         anticipated to result from the financial hardship distribution.

                  (c) Conditions Placed on Participation in Plan and other
         Fringe Benefits:. The Member's hardship distribution shall terminate
         his or her right to make any Employee After Tax Contributions or to
         have the Employer make any Salary Deferral Contributions on his or her
         behalf until the next time Employee After Tax Contributions and Salary
         Deferral Contributions are permitted after the lapse of 12 months
         following the hardship distribution and his or her timely filing of a
         written request to resume his or her Employee After Tax Contributions
         or Salary Deferral Contributions. Even then, if the Member resumes
         Contributions in his next taxable year he cannot have the Employer make
         any Salary Deferral Contributions in excess of the limit in section
         402(g) of the Code for that taxable year reduced by the amount of
         Salary Deferral Contributions made by the Employer on the Member's
         behalf during the taxable year of the Member in which he received the
         hardship distribution.

                  In addition, for 12 months after he receives a hardship
         distribution from this Plan the Member is prohibited from making
         elective contributions and employee contributions to all other
         qualified and nonqualified plans of deferred compensation maintained by
         the Employer, including stock option plans, stock purchase plans and
         cash or deferred arrangements that are part of cafeteria plans
         described in section 125 of the Code. However, the Member is not
         prohibited from making mandatory employee contributions to a defined
         benefit plan, or contributions to a health or welfare benefit plan,
         including one that is part of a cafeteria plan within the meaning of
         section 125 of the Code.

         7.4 WITHDRAWALS ON OR AFTER AGE 59 1/2. A Member who is at least age 59
1/2 is entitled to withdraw his vested interest in all of his Accounts.

         7.5 LOANS. The Committee may direct the Trustee to make loans to
Members (and Beneficiaries who are "parties in interest" within the meaning of
ERISA) who have a vested interest in the Plan. Loans may not be made to any
shareholder-employee (as defined in section 1379 of the Code as in effect before
the enactment of the Subchapter S Revision Act of 1982) or any owner-employee
(as defined in section 401(c)(3) of the Code or a member of the family of either
(as defined in section 267(c)(4) of the Code. The Loan Committee established by
the Committee will be responsible for administering the Plan loan program. All
loans will comply with the following requirements:

                  (a) All loans will be made solely from the Member's or
         Beneficiary's Account.

                  (b) Loans will be available on a nondiscriminatory basis to
         all Beneficiaries who are "parties in interest" within the meaning of
         ERISA, and to all Members.

                  (c) Loans will not be made for less than $1,000.

                  (d) The maximum amount of a loan may not exceed the lesser of
         (i) $50,000 reduced by the person's highest outstanding loan balance
         from the Plan during the preceding one year period, or (ii) one-half of
         the present value of the person's vested



                                     VII-2
<PAGE>   46

         Account balance under the Plan determined as of the date on which the
         loan is approved by the Loan Committee. If determining whether a loan
         would exceed these limits, all loans under all plans of the Employer
         and all Affiliated Employers which are outstanding or which have not
         been repaid at least one year before must be taken into consideration.

                  (e) Any loan from the Plan will be evidenced by a note or
         notes (signed by the person applying for the loan) having such
         maturity, bearing such rate of interest, and containing such other
         terms as the Loan Committee will require by uniform and
         nondiscriminatory rules consistent with this Section and proper lending
         practices. When required by law, the borrowing person must be supplied
         with all documents required by the truth-in-lending laws and any other
         applicable federal or state statute.

                  (f) All loans will bear a reasonable rate of interest which
         will be established by the Loan Committee. In determining the proper
         rate of interest to be charged, at the time any loan is made or
         renewed, the Loan Committee may contact one or more of the banks in the
         geographic location in which the Member or Beneficiary resides to
         determine what interest rate the banks would charge for a similar loan
         taking into account the collateral offered.

                  (g) Each loan will be fully secured by a pledge of the
         borrowing person's vested Account balance. No more than 50% of the
         person's vested Account balance (determined immediately after the
         origination of the loan) will be considered as security for any loan.

                  (h) Generally, the term of the loan will not be more than five
         years. The Loan Committee may agree to a longer term only if the term
         is otherwise reasonable and the proceeds of the loan are to be used to
         acquire a dwelling which will be used within a reasonable time
         (determined at the time the loan is made) as the principal residence of
         the borrowing person.

                  (i) The loan agreement will require level amortization over
         the term of the loan and repayment through salary withholding except in
         the case of a loan to a person who is not employed by the Employer.

                  (j) A Member may not make a withdrawal if the remaining
         balance of the Member's Account would be less than the outstanding loan
         balance or the withdrawal would violate any security requirements of
         the loan. No distribution may be made to a Member until all loans to
         him have been paid in full. If a Member has an outstanding loan from
         the Plan at the time he terminates employment with all Affiliated
         Employers, the outstanding loan principal balance and any accrued but
         unpaid interest will become immediately due in full. The Member will
         have the right to immediately pay the Trustee that amount. If the
         Member fails to repay the loan, the Trustee will foreclose on the loan
         and the Member will be deemed to have received a Plan distribution of
         the amount foreclosed upon. The Trustee will not foreclose upon a
         Member's Salary Deferral Contributions Account or Qualified Nonelective
         Employer Contributions Account until the Member has terminated
         employment with all Affiliated Employers.




                                     VII-3
<PAGE>   47

                  (k) If a Beneficiary defaults on his loan, the Trustee will
         foreclose on the loan and the Beneficiary will be deemed to have
         received a Plan distribution of the amount foreclosed upon.

                  (l) No amount that is pledged as collateral for a Plan loan to
         a Participant will be available for withdrawal before he has fully
         repaid his loan.

                  (m) All interest payments made pursuant to the terms of the
         loan agreement will be credited to the borrowing person's Account and
         will not be considered as general earnings of the Trust Fund to be
         allocated to other Members. All expenses or losses incurred because of
         the loan shall be charged to the borrowing person's Account.

                  (n) Payment of any loan made by a Member shall be suspended
         while a Member is in qualified military service and is covered by
         USERRA.

                  (o) The Committee is authorized to establish written
         guidelines which, if and when adopted, shall become part of this Plan
         and shall establish a procedure for applying for loans, the basis on
         which loans will be approved or denied, limitations (if any) on the
         types and amounts of loans offered, and any other matters necessary or
         appropriate to administering this Section.




                                     VII-4
<PAGE>   48

                                  ARTICLE VIII

                GENERAL PROVISIONS APPLICABLE TO FILING A CLAIM,
             DISTRIBUTIONS TO MINORS AND NO DUPLICATION OF BENEFITS

         8.1 CLAIMS PROCEDURE. When a benefit is due, the Member or Beneficiary
should submit his claim to the person or office designated by the Committee to
receive claims. Under normal circumstances, a final decision shall be made as to
a claim within 90 days after receipt of the claim. If the Committee notifies the
claimant in writing during the initial 90 day period, it may extend the period
up to 180 days after the initial receipt of the claim. The written notice must
contain the circumstances necessitating the extension and the anticipated date
for the final decision. If a claim is denied during the claims period, the
Committee must notify the claimant in writing. The denial must include the
specific reasons for it, the Plan provisions upon which the denial is based, and
the claims review procedure. If no action is taken during the claims period, the
claim is treated as if it were denied on the last day of the claims period.

         If a Member's or Beneficiary's claim is denied and he wants a review,
he must apply to the Committee in writing. That application may include any
comment or argument the claimant wishes to make. The claimant may either
represent himself or appoint a representative, either of whom has the right to
inspect all documents pertaining to the claim and its denial. The Committee may
schedule any meeting with the claimant or his representative that it finds
necessary or appropriate to complete its review.

         The request for review must be filed within 60 days after the denial.
If it is not, the denial becomes final. If a timely request is made, the
Committee must make its decision, under normal circumstances, within 60 days of
the receipt of the request for review. However, if the Committee notifies the
claimant prior to the expiration of the initial review period, it may extend the
period of review up to 120 days following the initial receipt of the request for
a review. All decisions of the Committee must be in writing and must include the
specific reasons for their action and the Plan provisions on which their
decision is based. If a decision is not given to the claimant within the review
period, the claim is treated as if it were denied on the last day of the review
period.

         8.2 NO DUPLICATION OF BENEFITS. There shall be no duplication of
benefits under this Plan. Without regard to any other language in this Plan, all
distributions and withdrawals are to be subtracted from a Member's Account as of
the date of the distribution or withdrawal. Thus, if the Member has received one
distribution or withdrawal and is ever entitled to another distribution or
withdrawal, the prior distribution or withdrawal is to be taken into account.

         8.3 DISTRIBUTIONS TO DISABLED OR MINORS. If the Committee determines
that any person to whom a payment is due is a minor or is unable to care for his
affairs because of a physical or mental disability, it shall have the authority
to cause the payments to be made to an ancestor, descendant, spouse, or other
person the Committee determines to have incurred, or to be expected to incur,
expenses for that person or to the institution which is maintaining or has
custody of the person unless a prior claim is made by a qualified guardian or
other legal representative. The Committee and the Trustee shall not be
responsible to oversee the application of those payments. Payments made pursuant
to this power shall be a complete



                                     VIII-1
<PAGE>   49

discharge of all liability under the Plan and Trust and the obligations of the
Employer, the Trustee, the Trust Fund and the Committee.




                                     VIII-2
<PAGE>   50

                                   ARTICLE IX

                             TOP-HEAVY REQUIREMENTS

         9.1 APPLICATION. The requirements described in this Article shall apply
to each Plan Year that this Plan is determined to be a Top-Heavy Plan under the
test set out in the following Section.

         9.2 TOP-HEAVY TEST. If on the Determination Date the Aggregate Accounts
of Key Employees in the Plan exceeds 60% of the Aggregate Accounts of all
Employees in the Plan, this Plan shall be a Top-Heavy Plan for that Plan Year.
In addition, if this Plan is required to be included in an Aggregation Group and
that group is a top-heavy group, this Plan shall be treated as a Top-Heavy Plan.
An Aggregation Group is a top-heavy group if on the Determination Date the sum
of (a) the present value of the cumulative accrued benefits for Key Employees
under all defined benefit plans in the Aggregation Group which contains this
Plan plus (b) the total of all of the accounts of Key Employees under all
defined contribution plans included in the Aggregation Group (which contains
this Plan) is more than 60% of a similar sum determined for all employees
covered in the Aggregation Group which contains this Plan.

                  In applying the above tests, the following rules shall apply:

                  (a) In determining the present value of the accumulated
         accrued benefits for any Employee or the amount in the account of any
         Employee, the value or amount shall be increased by all distributions
         made to or for the benefit of the Employee under the Plan during the
         five year period ending on the Determination Date.

                  (b) All rollover contributions made after December 31, 1983 by
         the Employee to the Plan shall not be considered by the Plan for either
         test.

                  (c) If an Employee is a Non-Key Employee under the Plan for
         the Plan Year but was a Key Employee under the Plan for another prior
         Plan Year, his account shall not be considered.

                  (d) Benefits shall not be taken into account in determining
         the top-heavy ratio for any Employee who has not performed services for
         the Employer during the last five-year period ending upon the
         Determination Date.

         9.3 VESTING RESTRICTIONS IF PLAN BECOMES TOP-HEAVY. If a Member has at
least one Hour of Service during a Plan Year when the Plan is a Top-Heavy Plan
he shall either vest under each of the normal vesting provisions of the Plan or
under the following vesting schedule, whichever is more favorable:




                                      IX-1
<PAGE>   51

<TABLE>
<CAPTION>
                                                                           PERCENTAGE OF AMOUNT VESTED
                                                                              IN ACCOUNTS CONTAINING
COMPLETED YEARS OF ACTIVE SERVICE                                             EMPLOYER CONTRIBUTIONS
---------------------------------                                             ----------------------
<S>                                                                           <C>
         Less than two years....................................................        0%
         Two years but less than three years....................................       20%
         Three years but less than four years...................................       40%
         Four years but less than five years....................................       60%
         Five years but less than six years.....................................       80%
         Six years or more......................................................      100%
</TABLE>

If the Plan ceases to be a Top-Heavy Plan, this requirement shall no longer
apply. After that date the normal vesting provisions of the Plan shall be
applicable to all subsequent Contributions by the Employer.

         9.4 MINIMUM CONTRIBUTION IF PLAN BECOMES TOP-HEAVY. If this Plan is a
Top-Heavy Plan and the normal allocation of the Employer Contribution and
forfeitures is less than 3% of any Non-Key Employee Member's Annual
Compensation, the Committee, without regard to the normal allocation procedures,
shall allocate the Employer Contribution and the forfeitures among the Members
who are in the employ of the Employer at the end of the Plan Year (even if the
Member has less than 501 Hours of Service in the Plan Year), in proportion to
each Member's Annual Compensation as compared to the total Annual Compensation
of all Members for that Plan Year until each Non-Key Employee Member has had an
amount equal to the lesser of (i) the highest rate of Contribution applicable to
any Key Employee, or (ii) 3% of his Annual Compensation allocated to his
Account. At that time, any more Employer Contributions or forfeitures shall be
allocated under the normal allocation procedures described earlier in this Plan.
Salary Deferral Contributions and Employer Matching Contributions made on behalf
of Key Employees are included in determining the highest rate of Employer
Contributions. Salary Deferral Contributions made on behalf of Non-Key Employees
shall not be included in determining the minimum contribution required under
this Section. Employer Matching Contributions and amounts that may be treated as
Section 401(k) Contributions or Section 401(m) Contributions, other than
Qualified Nonelective Employer Contributions, made on behalf of Non-Key
Employees may not be included in determining the minimum contribution required
under this Section to the extent that they are treated as Section 401(m)
Contributions or Section 401(k) Contributions for purposes of the Actual
Deferral Percentage test or the Contribution Percentage test.

                  In applying this restriction the following rules shall apply:

                  (a) Each Employee who is eligible for membership (without
         regard to whether he has made mandatory contributions, if any are
         required, or whether his compensation is less than a stated amount)
         shall be entitled to receive an allocation under this Section.

                  (b) All defined contribution plans required to be included in
         the Aggregation Group shall be treated as one plan for purposes of
         meeting the 3% maximum. This required aggregation shall not apply if
         this Plan is also required to be included in an



                                      IX-2
<PAGE>   52

         Aggregation Group which includes a defined benefit plan and this Plan
         enables that defined benefit plan to meet the requirements of sections
         401(a)(4) or 410 of the Code.

         9.5 COVERAGE UNDER MULTIPLE TOP-HEAVY PLANS. If this Plan is a
Top-Heavy Plan, it must meet the vesting and benefit requirements described in
this Article without taking into account contributions or benefits under Chapter
2 of the Code (relating to tax on self-employment income), Chapter 21 of the
Code (relating to Federal Insurance Contributions Act), Title II of the Social
Security Act or any other Federal or State law.

         If a Non-Key Employee is covered by both a Top-Heavy defined
contribution plan and a defined benefit plan, he shall receive the defined
benefit minimum, offset by the benefits provided under the defined contribution
plan.




                                      IX-3
<PAGE>   53

                                   ARTICLE X

                           ADMINISTRATION OF THE PLAN

         10.1 APPOINTMENT, TERM OF SERVICE & REMOVAL. The Board of Directors
shall appoint a Committee to administer this Plan. The members shall serve until
their resignation, death or removal. Any member may resign at any time by
mailing a written resignation to the Board of Directors. Any member may be
removed by the Board of Directors, with or without cause. Vacancies may be
filled by the Board of Directors from time to time.

         10.2 POWERS. The Committee is a fiduciary. It has the exclusive
responsibility for the general administration of the Plan and Trust, and has all
powers necessary to accomplish that purpose, including but not limited to the
following rights, powers, and authorities:

                  (a) to make rules for administering the Plan and Trust so long
         as they are not inconsistent with the terms of the Plan;

                  (b) to construe all provisions of the Plan and Trust;

                  (c) to correct any defect, supply any omission, or reconcile
         any inconsistency which may appear in the Plan or Trust;

                  (d) to select, employ, and compensate at any time any
         consultants, actuaries, accountants, attorneys, and other agents and
         employees the Committee believes necessary or advisable for the proper
         administration of the Plan and Trust; any firm or person selected may
         be a disqualified person but only if the requirements of section
         4975(d) of the Code have been met;

                  (e) to determine all questions relating to eligibility, Active
         Service, Compensation, allocations and all other matters relating to
         the amount of benefits and any one or more Members' or Former Members'
         entitlement to benefits and to determine when it is required under the
         Plan to treat a Former Member as a Member;

                  (f) to determine all controversies relating to the
         administration of the Plan and Trust, including but not limited to any
         differences of opinion arising between an Employer and the Trustee or a
         Member or Former Member, or any combination of them and any questions
         it believes advisable for the proper administration of the Plan and
         Trust;

                  (g) to direct or to appoint an investment manager or managers
         who can direct the Trustee in all matters relating to the investment,
         reinvestment and management of the Trust Fund;

                  (h) to direct the Trustee in all matters relating to the
         payment of Plan benefits;

                  (i) to delegate any clerical or recordation duties of the
         Committee as the Committee believes is advisable to properly administer
         the Plan and Trust; and




                                      X-1
<PAGE>   54

                  (j) to make any other determination of any fact or any
         decision as to any aspect of the administration of the Plan and Trust
         that is appropriate in its general administration of the Plan and
         Trust.

         10.3 ORGANIZATION. The Committee may select, from among its members, a
chairman, and may select a secretary. The secretary need not be a member of the
Committee. The secretary shall keep all records, documents and data pertaining
to its administration of the Plan and Trust.

         10.4 QUORUM AND MAJORITY ACTION. A majority of the Committee
constitutes a quorum for the transaction of business. The vote of a majority of
the members present at any meeting shall decide any question brought before that
meeting. In addition, the Committee may decide any question by a vote, taken
without a meeting, of a majority of its members.

         10.5 SIGNATURES. The chairman, the secretary and any one or more of the
members of the Committee to which the Committee has delegated the power shall
each, severally, have the power to execute any document on behalf of the
Committee, and to execute any certificate or other written evidence of the
action of the Committee. The Trustee, after it is notified of any delegation of
power in writing, shall accept and may rely upon any document executed by the
appropriate member or members as representing the action of the Committee until
the Committee files a written revocation of that delegation of power with the
Trustee.

         10.6 DISQUALIFICATION OF COMMITTEE MEMBER. A member of the Committee
who is also a Member of this Plan shall not vote or act upon any matter relating
solely to himself.

         10.7 DISCLOSURE TO MEMBERS. The Committee shall make available to each
Member and Beneficiary for his examination those records, documents and other
data required under ERISA, but only at reasonable times during business hours.
No Member or Beneficiary has the right to examine any data or records reflecting
the compensation paid to any other Member or Beneficiary. The Committee is not
required to make any other data or records available other than those required
by ERISA.

         10.8 STANDARD OF PERFORMANCE. The Committee and each of its members:
(a) shall use the care, skill, prudence and diligence under the circumstances
then prevailing that a prudent man, acting in a like capacity and familiar with
such matters, would use in conducting his business as the administrator of the
Plan, (b) shall, when exercising its power to direct investments, diversify the
investments of the Plan so as to minimize the risk of large losses, unless under
the circumstances it is clearly prudent not to do so, and (c) shall otherwise
comply with the provisions of this Plan and ERISA.

         10.9 LIABILITY OF COMMITTEE AND LIABILITY INSURANCE. No member of the
Committee shall be liable for any act or omission of any other member of the
Committee, the Trustee, any investment manager appointed by the Committee or any
other agent appointed by the Committee unless required by the terms of ERISA or
another applicable state or federal law under which liability cannot be waived.
No member of the Committee shall be liable for any act or omission of his own
unless required by ERISA or another applicable state or federal law under which
liability cannot be waived.




                                      X-2
<PAGE>   55

         If the Committee directs the Trustee to do so, it may purchase out of
the Trust Fund insurance for the members of the Committee, for any other
fiduciaries appointed by the Committee and for the Trust Fund itself to cover
liability or losses occurring because of the act or omission of any one or more
of the members of the Committee or any other fiduciary appointed under this
Plan. But, that insurance must permit recourse by the insurer against the
members of the Committee or the other fiduciaries concerned if the loss is
caused by breach of a fiduciary obligation by one or more members of the
Committee or other fiduciary.

         10.10 EXEMPTION FROM BOND. No member of the Committee is required to
give bond for the performance of his duties unless required by a law which
cannot be waived.

         10.11 COMPENSATION. The Committee shall serve without compensation but
shall be reimbursed by the Employer for all expenses properly incurred in the
performance of their duties unless the Sponsor elects to have those expenses
paid from the Trust Fund. Each Employer shall pay that part of the expense as
determined by the Committee in its sole judgment.

         10.12 PERSONS SERVING IN DUAL FIDUCIARY ROLES. Any person, group of
persons, corporations, firm or other entity, may serve in more than one
fiduciary capacity with respect to this Plan, including serving as both Trustee
and as a member of the Committee.

         10.13 ADMINISTRATOR. For all purposes of ERISA, the administrator of
the Plan is the Sponsor. The administrator has the final responsibility for
compliance with all reporting and disclosure requirements imposed under all
applicable federal or state laws and regulations.

         10.14 STANDARD OF JUDICIAL REVIEW OF COMMITTEE ACTIONS. The Committee
has full and absolute discretion in the exercise of each and every aspect of the
rights, power, authority and duties retained or granted it under the Plan,
including without limitation, the authority to determine all facts, to interpret
this Plan, to apply the terms of this Plan to the facts determined, to make
decisions based upon those facts and to make any and all other decisions
required of it by this Plan, such as the right to benefits, the correct amount
and form of benefits, the determination of any appeal, the review and correction
of the actions of any prior administrative committee, and the other rights,
powers, authority and duties specified in this Article and elsewhere in this
Plan. Notwithstanding any provision of law, or any explicit or implicit
provision of this document, any action taken, or finding, interpretation, ruling
or decision made by the Committee in the exercise of any of its rights, powers,
authority or duties under this Plan shall be final and conclusive as to all
parties, including without limitation all Members, Former Members and
Beneficiaries, regardless of whether the Committee or one or more of its members
may have an actual or potential conflict of interest with respect to the subject
matter of the action, finding, interpretation, ruling or decision. No final
action, finding, interpretation, ruling or decision of the Committee shall be
subject to de novo review in any judicial proceeding. No final action, finding,
interpretation, ruling or decision of the Committee may be set aside unless it
is held to have been arbitrary and capricious by a final judgment of a court
having jurisdiction with respect to the issue.




                                      X-3
<PAGE>   56

                                   ARTICLE XI

                          TRUST FUND AND CONTRIBUTIONS

         11.1 FUNDING OF PLAN. This Plan shall be funded by one or more separate
Trusts. If more than one Trust is used, each Trust shall be designated by the
name of the Plan followed by a number assigned by the Committee at the time the
Trust is established.

         11.2 INCORPORATION OF TRUST. Each Trust is a part of this Plan. All
rights or benefits which accrue to a person under this Plan shall be subject
also to the terms of the agreements creating the Trust or Trusts and any
amendments to them which are not in direct conflict with this Plan.

         11.3 AUTHORITY OF TRUSTEE. Each Trustee shall have full title and legal
ownership of the assets in the separate Trust which, from time to time, is in
his separate possession. No other Trustee shall have joint title to or joint
legal ownership of any asset in one of the other Trusts held by another Trustee.
Each Trustee shall be governed separately by the trust agreement entered into
between the Employer and that Trustee and the terms of this Plan without regard
to any other agreement entered into between any other Trustee and the Employer
as a part of this Plan.

         11.4 ALLOCATION OF RESPONSIBILITY. To the fullest extent permitted
under section 405 of ERISA, the agreements entered into between the Employer and
each of the Trustees shall be interpreted to allocate to each Trustee its
specific responsibilities, obligations and duties so as to relieve all other
Trustees from liability either through the agreement, Plan or ERISA, for any act
of any other Trustee which results in a loss to the Plan because of his act or
failure to act.




                                      XI-1
<PAGE>   57

                                  ARTICLE XII

                       ADOPTION OF PLAN BY OTHER EMPLOYERS

         12.1 ADOPTION PROCEDURE. Any business organization may, with the
approval of the Board of Directors, adopt this Plan by:

                  (a) adopting a resolution or executing a consent of the board
         of directors of the adopting Employer or executing an adoption
         instrument (approved by the board of directors of the adopting
         Employer) agreeing to be bound as an Employer by all the terms,
         conditions and limitations of this Plan except those, if any,
         specifically described in the adoption instrument; and

                  (b) providing all information required by the Committee and
         the Trustee.

         An adoption may be retroactive to the beginning of a Plan Year if these
conditions are complied with on or before the last day of that Plan Year.

         12.2 NO JOINT VENTURE IMPLIED. The document which evidences the
adoption of the Plan by an Employer shall become a part of this Plan. However,
neither the adoption of this Plan and its related Trust Fund by an Employer nor
any act performed by it in relation to this Plan and its related Trust Fund
shall ever create a joint venture or partnership relation between it and any
other Employer.

         12.3 ALL TRUST ASSETS AVAILABLE TO PAY ALL BENEFITS. The Accounts of
Members employed by the Employers which adopt this Plan shall be commingled for
investment purposes. All assets in the Trust Fund shall be available to pay
benefits to all Members employed by any Employer which is an Affiliated Employer
with the first Employer.

         12.4 QUALIFICATION A CONDITION PRECEDENT TO ADOPTION AND CONTINUED
PARTICIPATION. The adoption of this Plan and the Trust or Trusts used to fund
this Plan by a business organization is contingent upon and subject to the
express condition precedent that the initial adoption meets all statutory and
regulatory requirements for qualification of the Plan and the exemption of the
Trust or Trusts and that the Plan and the Trust or Trusts that are applicable to
it continue in operation to maintain their qualified and exempt status. In the
event the adoption fails to initially qualify and be exempt, the adoption shall
fail retroactively for failure to meet the condition precedent and the portion
of the Trust Fund applicable to the adoption shall be immediately returned to
the adopting business organization and the adoption shall be void ab initio. In
the event the adoption as to a given business organization later becomes
disqualified and loses its exemption for any reason, the adoption shall fail
retroactively for failure to meet the condition precedent and the portion of the
Trust Fund allocable to the adoption by that business organization shall be
immediately spun off, retroactively as of the last date for which the Plan
qualified, to a separate Trust for its sole benefit and an identical but
separate Plan shall be created, retroactively effective as of the last date the
Plan as adopted by that business organization qualified, for the benefit of the
Members covered by that adoption.




                                     XII-1
<PAGE>   58

                                  ARTICLE XIII

                     AMENDMENT AND WITHDRAWAL OR TERMINATION

                               PART A.  AMENDMENT

         13.1 RIGHT TO AMEND. The Sponsor has the sole right to amend this Plan.
An amendment may be made by adopting a resolution or executing a consent of the
Board of Directors, or by the appropriate officer of the Sponsor executing an
amendment document.

         13.2 LIMITATION ON AMENDMENTS. No amendment shall:

                  (a) vest in an Employer any interest in the Trust Fund;

                  (b) cause or permit the Trust Fund to be diverted to any
         purpose other than the exclusive benefit of the present or future
         Members and their Beneficiaries except under the circumstances
         described in Section 4.21;

                  (c) decrease the Account of any Member or eliminate an
         optional form of payment as to amounts then accrued;

                  (d) increase substantially the duties or liabilities of the
         Trustee without its written consent; or

                  (e) change the vesting schedule to one which would result in
         the nonforfeitable percentage of the Account derived from Employer
         Contributions (determined as of the later of the date of the adoption
         of the amendment or of the effective date of the amendment) of any
         Member being less than the nonforfeitable percentage computed under the
         Plan without regard to the amendment. If the Plan's vesting schedule is
         amended, if the Plan is amended in any other way that affects the
         computation of the Member's nonforfeitable percentage, or if the Plan
         is deemed amended by an automatic change to or from a Top-Heavy vesting
         schedule, each Member with at least three years of Service may elect,
         within a reasonable period after the adoption of the amendment or the
         change, to have the nonforfeitable percentage computed under the Plan
         without regard to the amendment or the change. The election period
         shall begin no later than the date the amendment is adopted or deemed
         to be made and shall end no later than the latest of the following
         dates: (1) 60 days after the date the amendment is adopted or deemed to
         be made, (2) 60 days after the date the amendment becomes effective, or
         (3) 60 days after the day the Member is issued written notice of the
         amendment.

         13.3 EACH EMPLOYER DEEMED TO ADOPT AMENDMENT UNLESS REJECTED. Each
Employer shall be deemed to have adopted any amendment made by the Sponsor
unless the Employer notifies the Committee of its rejection in writing within 30
days after it is notified of the amendment. A rejection shall constitute a
withdrawal from this Plan by that Employer unless the Sponsor acquiesces in the
rejection.




                                     XIII-1
<PAGE>   59

         13.4 AMENDMENT APPLICABLE ONLY TO MEMBERS STILL EMPLOYED UNLESS
AMENDMENT SPECIFICALLY PROVIDES OTHERWISE. No benefit for any person who died,
retired, became disabled or separated shall be affected by a subsequent
amendment unless the amendment specifically provides otherwise and the person
consents to its application. Instead, those persons who died, retired, became
disabled or separated prior to the execution of an amendment shall be entitled
to the benefit as adjusted from time to time as was provided by the Plan at the
time the person first became entitled to his benefit.

         13.5 MANDATORY AMENDMENTS. The Contributions of each Employer to this
Plan are intended to be:

                  (a) deductible under the applicable provisions of the Code;

                  (b) except as otherwise prescribed by applicable law, exempt
         from the Federal Social Security Act;

                  (c) except as otherwise prescribed by applicable law, exempt
         from withholding under the Code; and

                  (d) excludable from any Employee's regular rate of pay, as
         that term is defined under the Fair Labor Standards Act of 1938, as
         amended.

         The Sponsor shall make any amendment necessary to carry out this
intention, and it may be made retroactively.

                       PART B.  WITHDRAWAL OR TERMINATION

         13.6 WITHDRAWAL OF EMPLOYER. An Employer may withdraw from this Plan
and its related Trust Fund if the Sponsor does not acquiesce in its rejection of
an amendment or by giving written notice of its intent to withdraw to the
Committee. The Committee shall then determine the portion of the Trust Fund that
is attributable to the Members employed by the withdrawing Employer and shall
notify the Trustee to segregate and transfer those assets to the successor
Trustee or Trustees when it receives a designation of the successor from the
withdrawing Employer.

         A withdrawal shall not terminate the Plan and its related Trust Fund
with respect to the withdrawing Employer, if the Employer either appoints a
successor Trustee or Trustees and reaffirms this Plan and its related Trust Fund
as its new and separate plan and trust intended to qualify under section 401(a)
of the Code, or establishes another plan and trust intended to qualify under
section 401(a) of the Code.

         The determination of the Committee, in its sole discretion, of the
portion of the Trust Fund that is attributable to the Members employed by the
withdrawing Employer shall be final and binding upon all parties. The Trustee's
transfer of those assets to the designated successor Trustee shall relieve the
Trustee of any further obligation, liability or duty to the withdrawing
Employer, the Members employed by that Employer and their Beneficiaries, and the
successor Trustee or Trustees.




                                     XIII-2
<PAGE>   60

         13.7 TERMINATION OF PLAN. The Sponsor may terminate this Plan and its
related Trust Fund with respect to all Employers by executing and delivering to
the Committee and the Trustee, a notice of termination, specifying the date of
termination. Any Employer may terminate this Plan and its related Trust Fund
with respect to itself by executing and delivering to the Trustee a notice of
termination, specifying the date of termination. Likewise, this Plan and its
related Trust Fund shall automatically terminate with respect to any Employer if
there is a general assignment by that Employer to or for the benefit of its
creditors, or a liquidation or dissolution of that Employer without a successor.
Upon the termination of this Plan as to an Employer, the Trustee shall, subject
to the provisions of Section 13.9, distribute to each Member employed by the
terminating Employer the amount certified by the Committee to be due the Member.

         The Employer should apply to the Internal Revenue Service for a
determination letter with respect to its termination, and the Trustee should not
distribute the Trust Funds until a determination is received. However, should it
decide that a distribution before receipt of the determination letter is
necessary or appropriate it should retain sufficient assets to cover any tax
that may become due upon that determination.

         13.8 100% VESTING REQUIRED ON PARTIAL OR COMPLETE TERMINATION OR
COMPLETE DISCONTINUANCE. Without regard to any other provision of this Plan, if
there is a partial or total termination of this Plan or there is a complete
discontinuance of the Employer's Contributions, each of the affected Members
shall immediately become 100% vested in his Account as of the end of the last
Plan Year for which a substantial Employer Contribution was made and in any
amounts later allocated to his Account. If the Employer then resumes making
substantial Contributions at any time, the appropriate vesting schedule shall
again apply to all amounts allocated to each affected Member's Account beginning
with the Plan Year for which they were resumed.

         13.9 DISTRIBUTION UPON TERMINATION. A Member may receive a distribution
on account of termination of this Plan if neither the Employer nor any
Affiliated Employer establishes or maintains a successor plan within the period
ending 12 months after all assets are distributed from the Plan. A successor
plan for this purpose is any other defined contribution plan except: (a) an
employee stock ownership plan as defined in sections 4975(e) or 409 of the Code,
(b) a simplified employee pension plan as defined in section 408(k) of the Code,
or (c) or a defined contribution plan in which fewer than 2% of the Members of
this Plan were eligible to participate during the 24 month period beginning 12
months before the time of this Plan's termination. Any distribution on account
of the termination of this Plan, must be made only in the form of a lump sum
payment or a Direct Rollover, as elected by the Member. If a Member is given the
opportunity but fails to make an election as to the form of distribution, he
shall be deemed to have elected a lump sum distribution.




                                     XIII-3
<PAGE>   61

                                  ARTICLE XIV

               SALE OF EMPLOYER OR SUBSTANTIALLY ALL OF ITS ASSETS

         14.1 CONTINUANCE PERMITTED UPON SALE OR TRANSFER OF ASSETS. An
Employer's participation in this Plan and its related Trust Fund shall not
automatically terminate if it consolidates or merges and is not the surviving
corporation, sells substantially all of its assets, is a party to a
reorganization and its Employees and substantially all of its assets are
transferred to another entity, liquidates, or dissolves, if there is a successor
organization. Instead, the successor may assume and continue this Plan and its
related Trust Fund by executing a direction, entering into a contractual
commitment or adopting a resolution providing for the continuance of the Plan
and its related Trust Fund. Only upon the successor's rejection of this Plan and
its related Trust Fund or its failure to respond to the Employer's, the
Sponsor's or the Trustee's request that it affirm its assumption of this Plan
within 90 days of the request shall this Plan automatically terminate. In that
event the appropriate portion of the Trust Fund shall be distributed exclusively
to the Members or their Beneficiaries as soon as administratively feasible. If
there is a disposition to an unrelated entity of substantially all of the assets
used by the Employer in a trade or business or a disposition by the Employer of
its interest in a subsidiary, the Employer may make a lump sum distribution from
the Plan if it continues the Plan after the disposition; but the distribution
can only be made for those Members who continue employment with the acquiring
entity.

         14.2 DISTRIBUTIONS UPON DISPOSITION OF ASSETS OR A SUBSIDIARY. A Member
employed by an Employer that is a corporation is entitled to receive a lump sum
distribution of his interest in his Accounts in the event of the sale or other
disposition by the Employer of at least 85% of all of the assets used by the
Employer in a trade or business to an unrelated corporation if (a) the Employer
continues to maintain the Plan after the disposition and (b) in connection with
the disposition the Member is transferred to the employ of the corporation
acquiring the assets.

         A Member employed by an Employer that is a corporation is entitled to
receive a lump sum distribution of his interest in his Accounts in the event of
the sale or other disposition by the Employer of its interest in a subsidiary
(within the meaning of section 409(d)(3) of the Code) to an unrelated entity or
individual if (a) the Employer continues to maintain the Plan after the
disposition and (b) in connection with the disposition the Member continues
employment with the subsidiary.

         The selling Employer is treated as continuing to maintain the Plan
after the disposition only if the purchaser does not maintain the Plan after the
disposition. A purchaser is considered to maintain the Plan if it adopts the
Plan, becomes an employer whose employees accrue benefits under the Plan, or if
the Plan is merged or consolidated with, or any assets or liabilities are
transferred from the Plan to a plan maintained by the purchaser in a transaction
subject to section 414(l)(1) of the Code.

         An unrelated corporation, entity or individual is one that is not
required to be aggregated with the selling Employer under section 414(b), (c),
(m), or (o) of the Code after the sale or other disposition.




                                     XIV-1
<PAGE>   62

         If a Member's Account balance is or is deemed to be $5,000.00 or less
determined under the rules set out in Section 6.11, the Committee will direct
the Trustee to pay to the Member a lump sum cash distribution of his Account
balance as soon as administratively practicable following the disposition and
any Internal Revenue Service approval of the distribution that the Committee
deems advisable to obtain.

         If it is or is deemed to be more than $5,000.00 at the date of the
disposition, he may elect (a) to receive a lump sum cash distribution of his
Account balance as soon as administratively practicable following the
disposition and receipt of any Internal Revenue Service approval of the
distribution that the Committee deems advisable to obtain, or (b) he may elect
to defer receipt of his vested Account balance until the first day of the month
coincident with or next following the date that he attains age 65. In the manner
and at the time required under Department of Treasury regulations, the Committee
will provide the Member with a notice of his right to defer receipt of his
Account balance.

         However, no distribution shall be made to a Member under this Section
after the end of the second calendar year following the calendar year in which
the disposition occurred. In addition, no distribution shall be made under this
Section unless it is a lump sum distribution within the meaning of section
402(d)(4) of the Code, without regard to subparagraphs (A)(i) through (iv), (B),
and (F) of that section.




                                     XIV-2
<PAGE>   63

                                   ARTICLE XV

                                  MISCELLANEOUS

         15.1 PLAN NOT AN EMPLOYMENT CONTRACT. The adoption and maintenance of
this Plan and its related Trust Fund is not a contract between any Employer and
its Employees which gives any Employee the right to be retained in its
employment. Likewise, it is not intended to interfere with the rights of any
Employer to discharge any Employee at any time or to interfere with the
Employee's right to terminate his employment at any time.

         15.2 BENEFITS PROVIDED SOLELY FROM TRUST. All benefits payable under
this Plan shall be paid or provided for solely from the Trust Fund. No Employer
assumes any liability or responsibility to pay any benefit provided by the Plan.

         15.3 ANTI-ALIENATION PROVISION. No principal or income payable or to
become payable from the Trust Fund shall be subject: to anticipation or
assignment by a Member or by a Beneficiary to attachment by, interference with,
or control of any creditor of a Member or Beneficiary, or to being taken or
reached by any legal or equitable process in satisfaction of any debt or
liability of a Member or Beneficiary prior to its actual receipt by the Member
or Beneficiary. An attempted conveyance, transfer, assignment, mortgage, pledge,
or encumbrance of the Trust Fund, any part of it, or any interest in it by a
Member or Beneficiary prior to distribution shall be void, whether that
conveyance, transfer, assignment, mortgage, pledge, or encumbrance is intended
to take place or become effective before or after any distribution of Trust
assets or the termination of this Trust Fund itself. The Trustee shall never
under any circumstances be required to recognize any conveyance, transfer,
assignment, mortgage, pledge or encumbrance by a Member or Beneficiary of the
Trust Fund, any part of it, or any interest in it, or to pay any money or thing
of value to any creditor or assignee of a Member or Beneficiary for any cause
whatsoever. The prohibitions against the alienation of a Member's Account shall
not apply to:

                  (a) qualified domestic relations orders or domestic relations
         orders entered into prior to January 1, 1985, or

                  (b) any offset of a Member's Account under the Plan that the
         Member is ordered to pay to the Plan if (i) the order arises under a
         judgment of conviction of a crime involving the Plan, a civil judgment
         (including a consent decree) is entered by a court in connection with a
         violation (or alleged violation) of part 4 of subtitle B of title I of
         ERISA, or is pursuant to a settlement agreement between the Secretary
         of Labor and the Member, or between the Pension Benefit Guaranty
         Corporation and the Member, in connection with a violation (or alleged
         violation) of part 4 of such subtitle by a fiduciary or any other
         person, (ii) the judgment, order, decree or settlement agreement
         expressly provides for the offset of all or a part of the amount
         ordered or required to be paid to the Plan against the Member's Account
         balance under the Plan, and (iii) in a case in which the survivor
         annuity requirements of Section 401(a)(11) of the Code apply with
         respect to distributions, the requirements of Section
         401(a)(13)(C)(iii) of the Code are satisfied.




                                      XV-1
<PAGE>   64

         15.4 REQUIREMENTS UPON MERGER OR CONSOLIDATION OF PLANS. This Plan
shall not merge or consolidate with or transfer any assets or liabilities to any
other plan unless each Member would (if the Plan then terminated) receive a
benefit immediately after the merger, consolidation, or transfer which is equal
to or greater than the benefit he would have been entitled to receive
immediately before the merger, consolidation, or transfer (if the Plan had then
terminated).

         15.5 GENDER AND NUMBER. If the context requires it, words of one gender
when used in this Plan shall include the other genders, and words used in the
singular or plural shall include the other.

         15.6 SEVERABILITY. Each provision of this Agreement may be severed. If
any provision is determined to be invalid or unenforceable, that determination
shall not affect the validity or enforceability of any other provision.

         15.7 GOVERNING LAW; PARTIES TO LEGAL ACTIONS. The provisions of this
Plan shall be construed, administered, and governed under the laws of the State
of Texas and, to the extent applicable, by the laws of the United States. The
Trustee or any Employer may at any time initiate a legal action or proceeding
for the settlement of the account of the Trustee, or for the determination of
any question or for instructions. The only necessary parties to that action or
proceeding are the Trustee and the Employer concerned. However, any other person
or persons may be included as parties defendant at the election of the Trustee
and the Employer.




                                      XV-2
<PAGE>   65

                                  ARTICLE XVI

                    VOTING OF COMPANY STOCK AND TENDER OFFERS

         16.1 VOTING OF COMPANY STOCK. The Sponsor may, in its sole discretion,
pass through voting rights relating to Company Stock credited to Members'
Accounts; should these voting rights be passed through, the rules outlined in
this Section 16.1 shall govern the exercise of such rights. When the Sponsor
files preliminary or final proxy solicitation materials with the Securities and
Exchange Commission, the Sponsor or its designee shall cause a copy of all
materials to be simultaneously sent to the Trustee. Based on these materials,
the Sponsor or its designee shall prepare a voting instruction form. At the time
of mailing of notice of each annual or special stockholders' meeting of the
Sponsor, the Sponsor or its designee shall cause a copy of the notice and all
proxy solicitation materials to be sent to each Member with an interest in
Company Stock held in the Trust, together with the foregoing voting instruction
form to be returned to the Trustee or its designee. The form shall show the
number of full and fractional shares of the Company Stock credited to each
Member's Account. The Sponsor or its designee shall provide the Trustee with a
copy of any materials provided to the Members and shall certify to the Trustee
that the materials have been mailed or otherwise sent to the Members.

         Each Member with an interest in Company Stock held in the Trust shall
have the right to direct the Trustee as to the manner in which the Trustee is to
vote the number of shares of the Company Stock reflecting such Member's
proportional interest in the Company Stock held in the Trust (both vested and
unvested). Directions from a Member to the Trustee concerning the voting of the
Company Stock shall be communicated in writing, or by mailgram or similar means
to the Committee which will in turn notify the Trustee. These directions shall
be held in confidence by the Committee and the Trustee and shall not be divulged
to the Sponsor, or any officer or employee thereof, or any other person (except
to the extent such officer, employee or other person is a Committee member or
its designee). Upon its receipt of the directions, the Trustee shall vote the
shares of the Company Stock reflecting the Member's proportional interest in the
Company Stock held in the Trust as directed by the Member. The Trustee shall
vote shares of the Company Stock reflecting such Member's proportional interest
in the Company Stock held in the Trust (both vested and unvested) for which it
has received no directions from the Member in the same proportion on each issue
as it votes those shares for which it received voting directions from Members.
The Trustee shall vote shares of the Company Stock not credited to Members'
Accounts in the same proportion on each issue as it votes those shares credited
to Members' Accounts for which it received voting directions from Members.

         16.2 TENDER OFFERS. Upon commencement of a tender offer for any
securities held in the Trust that are the Company Stock, the Sponsor or its
designee shall notify each Member of the tender offer and utilize its best
efforts to timely distribute or cause to be distributed to each Member the same
information that is distributed to other stockholders of the Sponsor in
connection with the tender offer, and, after consulting with the Trustee, shall
provide and pay for a means by which the Member may direct the Trustee whether
or not to tender the Company Stock credited to the Member's vested and unvested
Accounts. The Sponsor or its designee shall provide the Trustee with a copy of
any material provided to the Members and shall certify to the Trustee that the
materials have been mailed or otherwise sent to Members.




                                     XVI-1
<PAGE>   66

         Each Member shall have the right to direct the Trustee to tender or not
to tender some or all of the shares of the Company Stock reflecting such
Member's proportional interest in the Company Stock held in the Trust (both
vested and unvested). Directions from a Member to the Trustee concerning the
tender of the Company Stock shall be communicated in writing, or by mailgram or
such similar means as is agreed upon by the Trustee and the Sponsor under the
preceding paragraph. These directions shall be held in confidence by the
Committee and the Trustee and shall not be divulged to the Sponsor, or any
officer or employee thereof, or any other person except to the extent that the
consequences of such directions are reflected in reports regularly communicated
to any such persons in the ordinary course of the performance of the Trustee's
services hereunder and except to the extent such officer, employee or other
person is a Committee member or its designee. The Trustee shall tender or not
tender shares of Company Stock as directed by the Member. To the extent that
Members fail to affirmatively direct the Trustee or fail to issue valid
directions to the Trustee to tender shares of the Company Stock credited to
their Accounts, those Members will be deemed to have instructed the Trustee not
to tender those shares. Accordingly, the Trustee shall not tender shares of
Company Stock credited to a Member's Accounts for which it has received no
directions or invalid directions from the Member.

         The Trustee shall tender that number of shares of the Company Stock not
credited to Members' Accounts which is determined by multiplying the total
number of shares of the Company Stock not credited to Members' accounts by a
fraction of which the numerator is the number of shares of the Company Stock
credited to Members' accounts for which the Trustee has received valid
directions from Members to tender (which directions have not been withdrawn as
of the date of this determination) and of which the denominator is the total
number of shares of the Company Stock credited to Members' Accounts.

         A Member who has directed the Trustee to tender some or all of the
shares of the Company Stock credited to the Member's accounts may, at any time
prior to the tender offer withdrawal date, direct the Trustee to withdraw some
or all of the tendered shares, and the Trustee shall withdraw the directed
number of shares from the tender offer prior to the tender offer withdrawal
deadline. Prior to the withdrawal deadline, if any shares of the Company Stock
not credited to Members' Accounts have been tendered, the Trustee shall
redetermine the number of shares of the Company Stock that would be tendered
under this Section if the date of the foregoing withdrawal were the date of
determination, and withdraw from the tender offer the number of shares of the
Company Stock not credited to Members' Accounts necessary to reduce the amount
of tendered Company Stock not credited to Members' Accounts to the amount so
redetermined. A Member shall not be limited as to the number of directions to
tender or withdraw that the Member may give to the Trustee.

         A direction by a Member to the Trustee to tender shares of the Company
Stock reflecting the Member's proportional interest in the Company Stock held in
the Trust shall not be considered a written election under the Plan by the
Member to withdraw, or have distributed, any or all of his withdrawable shares.
The Trustee shall credit to each proportional interest of the Member from which
the tendered shares were taken the proceeds received by the Trustee in exchange
for the shares of the Company Stock tendered from that interest.





                                     XVI-2
<PAGE>   67

         16.3 SHARES CREDITED. For all purposes of this Article, the number of
shares of the Company Stock deemed "credited" to a Member's Accounts as of the
relevant date (the record date or the date specified in the tender offer) shall
be calculated by reference to the number of shares reflected on the books of the
transfer agent as of the relevant date. In the case of a tender, the number of
shares credited shall be determined as of a date as close as administratively
feasible to the relevant date.

         16.4 CONVERSION. All provisions in this Article shall also apply to any
securities received as a result of a conversion of the Company Stock.

         16.5 NAMED FIDUCIARY. For purposes of ERISA, each Member shall be the
named fiduciary for purposes of Section 403(a)(1) of ERISA in connection with
the exercise of voting and tender offer rights relating to shares of the Company
Stock credited to the Member's Accounts and any shares of the Company Stock not
credited to the Member's Accounts that may be affected by the Member's voting or
tender decision.




                                     XVI-3
<PAGE>   68

         IN WITNESS WHEREOF, EOG Resources, Inc. has caused this Agreement to be
executed this ____ day of ____________ 2001, in multiple counterparts, each of
which shall be deemed to be an original, to be effective the 31st day of August
1999, except for those provisions which have an earlier effective date provided
by law, or as otherwise provided under applicable provisions of this Plan.


                                           EOG RESOURCES, INC.


                                           By___________________________________

                                           Title________________________________