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DATED JANUARY 1, 1999                                            MEDIAONE GROUP

                     AMENDED MEDIAONE GROUP 1994 STOCK PLAN
 
I.  PURPOSE.
 
    This Amended MediaOne Group 1994 Stock Plan (the "Plan"), is intended to
promote the long term success of MediaOne Group, Inc. (the "Company") by
affording certain eligible employees, executive officers, non-employee directors
of the Company and its Subsidiaries (as defined below) and certain outside
consultants or advisors to the Company and its affiliates with an opportunity to
acquire a proprietary interest in the Company, in order to incentivize such
persons and to align the financial interests of such persons with the
stockholders of the Company.
 
II.  DEFINITIONS.
 
    The following defined terms are used in the Plan:
 
    A. "Agreement" shall mean the agreement or grant letter accepted by the
Participant as described in Section VIII of the Plan between the Company and a
Participant under which the Participant receives an Award pursuant to this Plan.
 
     B. "Award" shall mean individually, collectively or in tandem, an incentive
award granted under the Plan, whether in the form of Options, SARs, Stock Awards
or Phantom Units.
 
     C. "Board" or "Board of Directors" shall mean the Board of Directors of the
Company.
 
    D. "Change of Control" shall mean any of the following:
 
     1. any "person" (as such term is used in Sections 13(d) and 14(d)(2) of the
Exchange Act) is or becomes a beneficial owner of (or otherwise has the
authority to vote), directly or indirectly, securities representing twenty
percent (20%) or more of the total voting power of all of the Company's then
outstanding voting securities, unless through a transaction arranged by, or
consummated with the prior approval of the Board of Directors; or
 
     2. any period of two (2) consecutive calendar years during which there
shall cease to be a majority of the Board of Directors comprised as follows:
individuals who at the beginning of such period constitute the Board of
Directors and any new director(s) whose election by the Board of Directors or
nomination for election by the Company's stockholders was approved by a vote of
at least two-thirds ( 2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved; or
 
     3. the Company becomes a party to a merger or consolidation in which either
(i) the Company will not be the surviving corporation or (ii) the Company will
be the surviving corporation and any outstanding shares of Common Stock of the
Company will be converted into shares of any other company (other than a
reincorporation or the establishment of a holding company involving no change of
ownership of the Company) or other securities or cash or other property
(excluding payments made solely for fractional shares); or
 
     4. any other event that a majority of the Board of Directors, in its sole
discretion, shall determine constitutes a Change of Control.
 
     E. "Code" shall mean the Internal Revenue Code of 1986, as amended.
 
     F. "Committee" shall mean the Human Resources Committee or the Sponsor
Committee or their delegates, as applicable, pursuant to provisions of Section
III of the Plan.
 
     G. "Common Stock" shall mean the common stock, $.01 par value, of the
Company.
 
     H. "Company" shall mean MediaOne Group, Inc., a Delaware corporation
(previously known as "U S WEST, Inc."), and any successor thereof.
 
     I. "Director Compensation" shall mean all cash or stock remuneration
payable to an Outside Director for service to the Company as a director, other
than reimbursement for expenses or Common
 
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THIS DOCUMENT CONSTITUTES A PROSPECTUS COVERING SECURITIES THAT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933.

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Stock received upon exercise of an Option, and shall include retainer fees for
service on, and fees for attendance at meetings of, the Board and any committees
thereof.
 
     J. "Disabled" or "Disability" shall mean such condition as would qualify
the individual as "disabled" for purposes of receiving a disability pension
under the MediaOne Group Pension Plan or long-term disability benefits under the
provisions of any MediaOne Group disability plan that provides long-term
disability benefits and is maintained for the benefit of eligible employees of
the Company or any Related Entity, provided, however, that in the case of an
Incentive Option, "disability" shall have the meaning specified in Section
22(e)(3) of the Code.
 
     K. "Dividend Equivalent Rights" shall mean the right to receive the amount
of any dividends that are paid on an equivalent number of shares of Common Stock
underlying an Option or Phantom Unit, which shall be payable either in cash or
in the form of additional Phantom Units or Stock.
 
     L. "Effective Date" shall mean the date on which the Plan was first
approved by the stockholders of the Company.
 
     M. "Eligible Employee" shall mean any employee of the Company or any 
Related Entity who is employed on the date of the grant of an Award.
 
     N. "Eligible Non-Employee" shall mean any consultant or advisor to the 
Company or any Related Entity.
 
     O. "Exchange Act" shall mean the Securities Exchange Act of 1934, as 
amended.
 
     P. "Executive Officers" shall mean any Officer of the Company or any 
Related Entity who, at the time of an Award, is subject to the reporting 
requirements of Section 16(a) of the Exchange Act.
 
     Q. "Fair Market Value" shall mean the closing price of a share of Common 
Stock as reported on the New York Stock Exchange for the applicable date, or 
if there were no sales on such date, on the last day on which there were 
sales.
 
     R. "Human Resources Committee" shall mean the human resources committee 
of the Board or any other committee of the Board appointed by the Board to 
administer the Plan in lieu of the Human Resources Committee, which committee 
shall consist of no fewer than three (3) persons, each of whom shall be a 
Non-Employee Director.
 
     S. "Incentive Option" shall mean an incentive stock option under the 
provisions of Section 422 of the Code.
 
     T. "Indexed" shall mean the periodic adjustment of an Option Price based 
upon adjustment criteria determined by the Committee, but in no event shall 
the Option Price be adjusted to an amount less than the original Option Price.
 
     U. "Non-Employee Director" shall have the meaning set forth in Rule 
16b-3(b)(3) and its successor promulgated under the Exchange Act.
 
     V. "Nonqualified Option" shall mean an Option which does not qualify 
under Section 422 of the Code.
 
     W. "Officer" shall mean any executive of the Company or any Related 
Entity who participates in the Company's executive compensation programs.
 
     X. "Option" shall mean an option granted by the Company to purchase 
Common Stock pursuant to the provisions of this Plan, including Incentive 
Options, Nonqualified Options and Reload Options.
 
     Y. "Optionee" shall mean a Participant to whom one or more Options have 
been granted.
 
     Z. "Option Price" shall mean the price per share payable to the Company 
for shares of Common Stock upon the exercise of an Option.
 
    AA. "Parent Corporation" shall mean any corporation within the meaning of 
Section 424(e) of the Code.

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    AB. "Participant" shall mean an Eligible Employee, Eligible Non-Employee, 
Executive Officer or Non-Employee Director who is granted an Award.
 
    AC. "Phantom Unit" shall mean a notional account representing a value 
equivalent to one share of Common Stock on the Award date.
 
    AD. "Plan" shall mean the Amended MediaOne Group 1994 Stock Plan.
 
    AE. "Related Entity" shall mean any Parent Corporation or Subsidiary of 
the Company.
 
    AF. "Reload Option" shall mean the right to receive a further Option for 
a number of shares equal to the number of shares of Common Stock surrendered 
by the Optionee upon exercise of the original Option as provided in Section 
IX.E of the Plan.
 
    AG. "Restricted Period" shall mean the period of time from the date of 
grant of Restricted Stock until the lapse of restrictions attached thereto 
under the terms of the Agreement granting such Restricted Stock, pursuant to 
the provisions of the Plan or by action of the Committee.
 
    AH. "Restricted Stock" shall mean an Award made by the Committee 
entitling the Participant to acquire, at no cost or for a purchase price 
determined by the Committee at the time of grant, shares of Common Stock 
which are subject to restrictions in accordance with the provisions of 
Section XII hereof.
 
    AI. "Retirement" shall mean with respect to any Eligible Employee, that 
such person has terminated employment with the Company or any Related Entity 
other than "for cause" (as defined in subsection IX.H.(v)) and (i) such 
person specifically is treated as "retired" for purposes of the Plan under 
any individually negotiated, custom, written agreement or arrangement between 
the Company or any Related Entity and the Eligible Employee, or (ii) such 
person has attained one of the following combinations of age and years of 
service as of the date of such termination (measuring years of service for 
this purpose in the same manner as "term of employment" is measured under the 
MediaOne Group Pension Plan):
 
<TABLE>
<CAPTION>
      AGE          YEARS OF SERVICE
----------------  -------------------
<S>               <C>
    Any age        At least 30 years
 50 through 54     At least 25 years
 55 through 59     At least 20 years
 60 through 64     At least 15 years
  65 and older     At least 10 years
</TABLE>
 
    AJ. "Securities Act" shall mean the Securities Act of 1933, as amended 
from time to time.
 
    AK. "Sponsor Committee" shall mean a committee of the Company consisting 
of employees of the Company or any Related Entity appointed by the Human 
Resources Committee and which shall administer the Plan as provided in 
Section III hereof.
 
    AL. "Stock Appreciation Right" or "SAR" shall mean a grant entitling the 
Participant to receive an amount in cash or shares of Common Stock or a 
combination thereof having a value equal to (or if the Committee shall so 
determine at the time of a grant, less than) the excess of the Fair Market 
Value of a share of Common Stock on the date of exercise over the Fair Market 
Value of a share of Common Stock on the date of grant (or over the Option 
Price or such other price as the Committee shall determine, if the Stock 
Appreciation Right was granted in tandem with an Option) multiplied by the 
number of shares with respect to which the Stock Appreciation Right shall 
have been exercised, with the Committee having sole discretion to determine 
the form or forms of payment at the time of grant of the SAR.
 
    AM. "Stock Awards" shall mean any Award which is in the form of 
Restricted Stock and any outright grants of Common Stock approved by the 
Committee pursuant to the Plan.
 
    AN. "Subsidiary" shall mean with respect to any Award other than an 
Incentive Option, any corporation, joint venture or partnership in which the 
Company owns, directly or indirectly, (i) with respect to a corporation, 
stock possessing twenty percent (20%) or more of the total combined voting 
power of all classes of stock in the corporation or (ii) in the case of a 
joint venture or partnership, the Company possesses a twenty percent (20%) 
interest in the capital or profits of such joint venture or partnership. In
 
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the case of any Incentive Option, Subsidiary shall mean any corporation 
within the meaning of Section 424(f) of the Code.
 
    AO. "Vested" shall mean the status that results with respect to an Option 
or other Award which may be immediately exercised under the terms of the 
Agreement granting such Option or other Award, pursuant to the provisions of 
the Plan or by action of the Committee.
 
III.  ADMINISTRATION.
 
     A. The Plan shall be administered by the Human Resources Committee with 
respect to Officers, Executive Officers and Non-Employee Directors and by the 
Sponsor Committee with respect to all other Eligible Employees and Eligible 
Non-Employees. The Human Resources Committee may adopt such rules, 
regulations and guidelines as it determines necessary for the administration 
of the Plan. Subject to any such rules, regulations and guidelines adopted by 
the Human Resources Committee, the Sponsor Committee shall have the power to 
adopt rules, regulations and guidelines to permit such Committee to 
administer the Plan with respect to Eligible Employees (other than Officers 
and Executive Officers) and with respect to Eligible Non-Employees.
 
     B. The Committee may delegate to one or more of its members, or to one 
or more agents, such administrative duties as it may deem advisable, and the 
Committee or any person to whom it has delegated duties as aforesaid may 
employ one or more persons to render advice with respect to any 
responsibility the Committee or such person may have under the Plan. The 
Committee may employ such legal or other counsel, consultants and agents as 
it may deem desirable for the administration of the Plan and may rely upon 
any opinion or computation received from any such counsel, consultant or 
agent. Expenses incurred by the Committee in the engagement of such counsel, 
consultant or agent shall be paid by the Company or such Related Entity whose 
employees have benefited from the Plan, as determined by the Committee. The 
Company shall indemnify members of the Committee and any agent of the 
Committee who is an employee of the Company or a Related Entity against any 
and all liabilities or expenses to which they may be subjected by reason of 
any act or failure to act with respect to their duties on behalf of the Plan, 
except in circumstances involving such person's gross negligence or willful 
misconduct.
 
     C. In furtherance of and not in limitation of the Committee's 
discretionary authority, subject to the provisions of the Plan, the Committee 
shall have the authority to:
 
     1. determine the Participants to whom Awards shall be granted and the 
number of and terms and conditions upon which Awards shall be granted (which 
need not be the same for all Awards or types of Awards);
 
     2. establish, in its sole discretion, annual or long-term financial 
goals of the Company, Related Entity, or division, department, or group of 
the Company or Related Entity, or individual goals which the Committee shall 
consider in granting Awards, if any;
 
     3. determine the satisfaction of performance goals established by the 
Committee based upon periods of time or any combinations thereof;
 
     4. determine the time when Awards shall be granted, the Option Price of 
each Option, the period(s) during which Options shall be exercisable (whether 
in whole or in part), the restrictions to be applicable to Awards, and the 
other terms and provisions of Awards;
 
     5. modify grants of Awards pursuant to Paragraph D. of this Section III 
or rescind grants of Awards pursuant to Section IX.H(v), respectively;
 
     6. provide the establishment of a procedure whereby a number of shares 
of Common Stock or other securities may be withheld from the total number of 
shares of Common Stock or other securities to be issued upon exercise of an 
Option, the lapse of restrictions on Restricted Stock and the vesting of 
Phantom Units (other than an Incentive Option) to meet the obligation of 
withholding for income, social security and other taxes incurred by a 
Participant upon such exercise or required to be withheld by the Company in 
connection with such exercise;
 
     7. adopt, modify and rescind rules and regulations and guidelines 
relating to the Plan;
 
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     8. adopt modifications to the Plan and procedures, as may be necessary 
to comply with provisions of the laws and applicable regulatory rulings of 
countries in which the Company or a Related Entity operates in order to 
assure the legality of Awards granted under the Plan to Participants who 
reside in such countries;
 
     9. obtain the approval of the stockholders of the Company with respect 
to Awards consisting of Phantom Units or Restricted Stock; provided, however, 
no action shall be proposed to stockholders without the approval of the Board 
of Directors; and
 
    10. make all determinations, perform all other acts, exercise all other 
powers and establish any other procedures determined by the Committee to be 
necessary, appropriate or advisable in administering the Plan and to maintain 
compliance with any applicable law.
 
     D. The Committee may at any time, in its sole discretion, accelerate the 
exercisability of any Awards and waive or amend any and all restrictions and 
conditions of any Awards.
 
     E. Subject to and not inconsistent with the express provisions of the 
Plan, the Code and Rule 16b-3 of the Exchange Act, the Committee shall have 
the authority to require, as a condition to the granting of any Option, SAR 
or other Award (to the extent applicable) to any Executive Officer of the 
Company or any Related Entity that the Executive Officer receiving such 
Option, SAR or other Award agree not to sell or otherwise dispose of such 
Option, SAR or other Award or Common Stock acquired pursuant to such Option, 
SAR or other Award (to the extent applicable) or any other "derivative 
security" (as defined by Rule 16a-1(c) under the Exchange Act) for a period 
of six (6) months following the later of (i) the date of the grant of such 
Option, SAR or other Award (to the extent applicable) or (ii) the date when 
the other Option Price of such Option, SAR or other Award is fixed, if such 
Option Price is not fixed at the date of grant of such Option, SAR or other 
Award.
 
IV.  DECISIONS FINAL.
 
     Any decision, interpretation or other action made or taken in good faith 
by the Committee arising out of or in connection with the Plan shall be 
final, binding and conclusive on the Company and all Participants and their 
respective heirs, executors, administrators, successors and assigns.
 
V.   ARBITRATION.
 
     Any agreement may contain, among other things, provisions that require 
arbitration of any and all disputes between a Participant and the Company or 
any Related Entity, in a form or forms acceptable to the Committee, in its 
sole discretion.
 
VI.  DURATION OF THE PLAN.
 
     The Plan shall remain in effect for a period of ten (10) years from the 
Effective Date, unless terminated by the Board pursuant to Section XX.
 
VII. SHARES AVAILABLE; LIMITATIONS.
 
     A. The maximum aggregate number of shares of Common Stock that may be 
granted in any calendar year for all purposes under the Plan shall be one 
percent (1.0%) of the shares outstanding (excluding shares held in the 
Company's treasury) on the first day of such calendar year, provided, 
however, that in the event that fewer than the full aggregate number of 
shares available for issuance in any calendar year are issued in such year, 
the shares not issued shall be added to the shares available for issuance in 
any subsequent year or years. If, for any reason, any shares of Common Stock 
as to which Options, SARs, Restricted Stock, or Phantom Units have been 
granted cease to be subject to exercise or purchase hereunder (other than the 
exercise of SARs for cash), the underlying shares of Common Stock shall 
thereafter be available for grants to Participants under the Plan during any 
calendar year. Awards granted under the Plan may be fulfilled in accordance 
with the terms of the Plan with (i) authorized and unissued shares of the 
Common Stock or (ii) issued shares of Common Stock reacquired by the Company, 
in each situation, as the Board of Directors or the Committee may determine 
from time to time at its sole discretion.
 
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<PAGE>

     B. The maximum number of shares of Common Stock that shall be subject to 
the grant of an Award in any calendar year for Awards other than Options or 
SARs shall not exceed one-third ( 1/3) of the total number of shares of 
Common Stock subject to Awards granted under the Plan for such calendar year.
 
     C. The maximum number of shares of Common Stock with respect to which 
Awards may be granted to any individual Participant in any calendar year may 
not exceed one million five hundred thousand (1,500,000).
 
     D. The cumulative number of shares of Common Stock that may be issued 
under this Plan in connection with the exercise of Incentive Options shall 
not exceed ten million (10,000,000).
 
VIII.  GRANT OF AWARDS.
 
     A. The Committee shall determine the type or types of Award(s) to be 
made to each Participant. Awards may be granted singly, in combination or in 
tandem subject to restrictions set forth in Section IX.C for Incentive 
Options. The types of Awards that may be granted under the Plan are Options, 
with or without Reload Options, SARs, Stock Awards and Phantom Units, and 
with respect to Phantom Units and Restricted Stock, with or without Dividend 
Equivalent Rights.
 
     B. Each grant of an Award under this Plan shall be evidenced by an 
Agreement dated as of the date of the grant of the Award, other than Stock 
Awards consisting of an outright grant of shares of Common Stock. This 
Agreement shall set forth the terms and conditions of the Award, as may be 
determined by the Committee, and if the Agreement relates to the grant of an 
Option, shall indicate whether the Option that it evidences, is intended to 
be an Incentive Option or a Nonqualified Option. Each grant of an Award is 
conditioned upon the acceptance by the Participant of the terms of the 
Agreement. Unless otherwise extended by the Committee, a Participant shall 
have ninety (90) days from the date of the Agreement to accept its terms.
 
IX.  OPTIONS.
 
     The Committee, in its sole discretion, may grant Incentive Options or 
Nonqualified Options to Eligible Employees, Officers, and Executive Officers, 
and Nonqualified Options to Non-Employee Directors and Eligible 
Non-Employees. Any Options granted to a Participant under predecessor plans 
which remain outstanding as of the Effective Date shall be governed by the 
terms and conditions of the Plan, except to the extent the provisions of the 
Plan are inconsistent with the terms of the Options granted under the 
predecessor plans, in which event the applicable provisions of the 
predecessor plans shall govern; provided, however, that in no event shall 
there be a modification of the terms of any Incentive Option granted under 
the predecessor plans. The terms and conditions of the Options granted under 
this Section IX shall be determined from time to time by the Committee, as 
set forth in the Agreement granting the Option, and subject to the following 
conditions:
 
     A. NONQUALIFIED OPTIONS.  The Option Price for each share of Common 
Stock issuable pursuant to a Nonqualified Option may be an amount at or above 
the Fair Market Value on the date such Option is granted, may be Indexed from 
the original Option Price and may be granted with or without Dividend 
Equivalent Rights; provided, however, that with respect to Nonqualified 
Options granted to any Executive Officer, no Dividend Equivalent Rights may 
be granted.
 
     B. INCENTIVE OPTIONS.  The Option Price for each share of Common Stock 
issuable pursuant to an Incentive Option shall not be less than one hundred 
percent (100%) of the Fair Market Value on the date such Option is granted 
and may be Indexed from the original Option Price.
 
     C. INCENTIVE OPTIONS; SPECIAL RULES.  Options granted in the form of 
Incentive Options shall be subject to the following provisions:
 
     1. GRANT.  No Incentive Option shall be granted pursuant to this Plan 
more than ten (10) years after the Effective Date.
 
     2. ANNUAL LIMIT.  The aggregate Fair Market Value (determined at the 
time the Option is granted) of the shares of Common Stock with respect to 
which one or more Incentive Options are exercisable for the first time by any 
Optionee during any calendar year under the Plan or under any other stock 
plan of the Company or any Related Entity shall not exceed $100,000 or such 
other maximum amount permitted
 
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under Section 422 of the Code. Any Option purporting to constitute an 
Incentive Option in excess of such limitation shall constitute a Nonqualified 
Option.
 
     3. 10% STOCKHOLDER.  If any Optionee to whom an Incentive Option is to 
be granted pursuant to the provisions of the Plan is, on the date of grant, 
an individual described in Section 422(b)(6) of the Code, then the following 
special provisions shall be applicable to the Option granted to such 
individual:
 
    (a) the Option Price of shares subject to such Incentive Option shall not 
be less than 110% of the Fair Market Value of Common Stock on the date of 
grant; and
 
    (b) the Option shall not have a term in excess of (5) years from the date 
of grant.
 
     D. OTHER OPTIONS.  The Committee may establish rules with respect to, 
and may grant to Eligible Employees, Options to comply with any amendment to 
the Code made after the Effective Date providing for special tax benefits for 
stock options.
 
     E. RELOAD OPTIONS.  Without in any way limiting the authority of the 
Committee to make Awards hereunder, the Committee shall have the authority to 
grant Reload Options. Any such Reload Option shall be subject to such other 
terms and conditions as the Committee may determine. Notwithstanding the 
above, (i) the Committee shall have the right, in its sole discretion, to 
withdraw a Reload Option to the extent that the grant thereof will result in 
any adverse accounting consequences to the Company and (ii) no additional 
Reload Options shall be granted upon the exercise of a Reload Option.
 
     F. TERM OF OPTION.  No Option shall be exercisable after the expiration 
of ten (10) years from the date of grant of the Option.
 
     G. EXERCISE OF STOCK OPTION.  Each Option shall be exercisable in one or 
more installments as the Committee in its sole discretion may determine at 
the time of the Award and as provided in the Agreement. The right to purchase 
shares shall be cumulative so that when the right to purchase any shares has 
accrued such shares or any part thereof may be purchased at any time 
thereafter until the expiration or termination of the Option. The Option 
Price shall be payable (i) in cash or by an equivalent means acceptable to 
the Committee, (ii) by delivery (constructive or otherwise) to the Company of 
shares of Common Stock owned by the Optionee or (iii) by any combination of 
the above as provided in the Agreement. Shares delivered to the Company in 
payment of the Option Price shall be valued at the Fair Market Value on the 
date of the exercise of the Option.
 
     H.  VESTING.  The Agreement shall specify the date or dates on which the 
Optionee may begin to exercise all or a portion of his Option. Subsequent to 
such date or dates, the Option shall be deemed vested and fully exercisable.
 
    (i) DEATH. In the event of the death of any Optionee, all Options held by 
such Optionee on the date of his death shall become Vested Options and the 
estate of such Optionee, shall have the right, at any time and from time to 
time within one year after the date of death, or such other period, if any, 
as the Committee in its sole discretion may determine, to exercise the 
Options of the Optionee (but not after the earlier of the expiration date of 
the Option or, in the case of an Incentive Option, one (1) year from the date 
of death).
 
    (ii) DISABILITY. If the employment of any Optionee is terminated because 
of Disability, all Options held by such Optionee on the date of his or her 
termination shall be retained by such Optionee, and such Options that are not 
yet Vested Options shall become Vested Options in accordance with the vesting 
schedule established at the time such Options were issued. The Optionee shall 
have the right to exercise Vested Options at any time and from time to time, 
but not after the expiration date of the Option or, in the case of Incentive 
Options where tax-advantaged treatment is desired, one year from the date of 
termination of employment.
 
   (iii) RETIREMENT. Upon an Optionee's Retirement, all Options held by such 
Optionee on the date of his or her Retirement shall be retained by such 
Optionee, and such Options that are not yet Vested Options shall become 
Vested Options in accordance with the vesting schedule established at the 
time such Options were issued, unless the Committee, in its sole discretion, 
determines otherwise. Unless the Committee, in its sole discretion, 
determines otherwise, the Optionee shall have the right to exercise Vested 
Options at any time and from time to time, but not after the expiration date 
of the Option. In the case of Incentive
 
                                       7
<PAGE>

Options where tax-advantaged treatment is desired, the Optionee shall have 
the right to exercise Vested Options three months from the date of Retirement.
 
   (iv) OTHER TERMINATION. If the employment with the Company or a Related 
Entity of an Optionee is terminated for any reason other than for death or 
Disability and other than "for cause" as defined in subparagraph (v) below, 
such Optionee shall have the right, in the case of a Vested Option, for a 
period of three (3) months after the date of such termination or such longer 
period as determined by the Committee, to exercise any such Vested Option, 
but in any event not after the expiration date of any such Option.
 
    (v) TERMINATION FOR CAUSE. Notwithstanding any other provision of the 
Plan to the contrary, if the Optionee's employment is terminated by the 
Company or any Related Entity "for cause" (as defined below), such Optionee 
shall immediately forfeit all rights under his Options except as to the 
shares of Common Stock already purchased prior to such termination. 
Termination "for cause" shall mean (unless another definition is agreed to in 
writing by the Company and the Optionee) termination by the Company because 
of: (a) the Optionee's willful and continued failure to substantially perform 
his duties (other than any such failure resulting from the Optionee's 
incapacity due to physical or mental impairment) after a written demand for 
substantial performance is delivered to the Optionee by the Company, which 
demand specifically identifies the manner in which the Company believes the 
Optionee has not substantially performed his duties, (b) the willful conduct 
of the Optionee which is demonstrably and materially injurious to the Company 
or Related Entity, monetarily or otherwise, or (c) the conviction of the 
Optionee for a felony by a court of competent jurisdiction.
 
X.   FOREIGN OPTIONS AND RIGHTS.
 
     The Committee may make Awards of Options to Eligible Employees, 
Officers, Executive Officers, Non-Employee Directors and Eligible 
Non-Employees who are subject to the tax laws of nations other than the 
United States, which Awards may have terms and conditions as determined by 
the Committee as necessary to comply with applicable foreign laws. The 
Committee may take any action which it deems advisable to obtain approval of 
such Option by the appropriate foreign governmental entity; provided, 
however, that no such Award may be granted pursuant to this Section X and no 
action may be taken which would result in a violation of the Exchange Act, 
the Code or any other applicable law.
 
XI.  STOCK APPRECIATION RIGHTS.
 
     The Committee shall have the authority to grant SARs to Eligible 
Employees, Officers, Executive Officers, Non-Employee Directors and Eligible 
Non-Employees either alone or in connection with an Option. SARs granted in 
connection with an Option shall be granted either at the time of grant of the 
Option or by amendment to the Option. The terms and conditions of all SARs, 
whether granted individually or in connection with an Option, shall be 
determined by the Committee and set forth in the Agreement granting the SARs, 
provided, however, that no fractional shares of Common Stock shall be issued 
upon exercise of any SAR.
 
XII. RESTRICTED STOCK.
 
     The Committee may, in its sole discretion, grant Restricted Stock to 
Eligible Employees, Eligible Non-Employees, Officers, Executive Officers or 
Non-Employee Directors subject to the provisions below.
 
     A.  RESTRICTIONS.  A stock certificate representing the number of shares 
of Restricted Stock granted shall be held in custody by the Company for the 
Participant's account. The Participant shall have all rights and privileges 
of a stockholder as to such Restricted Stock, including the right to receive 
dividends, if any, and the right to vote such shares, except that, subject to 
the provisions of Paragraph B. below, the following restrictions shall apply: 
(i) the Participant shall not be entitled to delivery of the certificate 
until the expiration of the Restricted Period; (ii) none of the shares of 
Restricted Stock may be sold, transferred, assigned, pledged, or otherwise 
encumbered or disposed of during the Restricted Period; (iii) the Participant 
shall, if requested by the Company, execute and deliver to the Company, a 
stock power endorsed in blank. The Restricted Period shall lapse upon a 
Participant becoming Disabled or the death of a Participant. If a Participant 
ceases to be an employee of the Company or a Related Entity prior to the 
expiration of the Restricted Period applicable to such shares, except as a 
result of the death or Disability of the Participant, shares of Restricted 
Stock still subject to restrictions shall be forfeited unless otherwise 
determined by the Committee, and all rights of the Participant to such shares 
shall terminate without
 
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further obligation on the part of the Company. Upon the forfeiture (in whole 
or in part) of shares of Restricted Stock, such forfeited shares shall become 
shares of Common Stock held in the Company's treasury without further action 
by the Participant.
 
     B.  TERMS AND CONDITIONS.  The Committee shall establish the terms and 
conditions for Restricted Stock pursuant to Section III of the Plan, 
including whether any shares of Restricted Stock shall have voting rights or 
a right to any dividends that are declared. Terms and conditions established 
by the Committee need not be the same for all grants of Restricted Stock. The 
Committee may provide for the restrictions to lapse with respect to a portion 
or portions of the Restricted Stock at different times or upon the occurrence 
of different events, and the Committee may waive, in whole or in part, any or 
all restrictions applicable to a grant of Restricted Stock. Restricted Stock 
Awards may be issued for no cash consideration or for such minimum 
consideration as may be required by applicable law or such other 
consideration as may be determined by the Committee.
 
     C.  DELIVERY OF RESTRICTED SHARES.  At the end of the Restricted Period 
as herein provided, a stock certificate for the number of shares of 
Restricted Stock with respect to which the restrictions have lapsed shall be 
delivered (less any shares delivered pursuant to Section XIX.C in 
satisfaction of any withholding tax obligation), free of all such 
restrictions, except applicable securities law restrictions, to the 
Participant or the Participant's estate, as the case may be. The Company 
shall not be required to deliver any fractional share of Common Stock but 
shall pay, in lieu thereof, the Fair Market Value (measured as of the date 
the restrictions lapse) of such fractional share to the Participant or the 
Participant's estate, as the case may be. Notwithstanding the foregoing, the 
Committee may authorize the delivery of the Restricted Stock to a Participant 
during the Restricted Period, in which event any stock certificates in 
respect of shares of Restricted Stock thus delivered to a Participant during 
the Restricted Period applicable to such shares shall bear an appropriate 
legend referring to the terms and conditions, including the restrictions, 
applicable thereto.
 
XIII.  PHANTOM UNITS.
 
     A.  GENERAL.  The Committee may, in its sole discretion, grant the right 
to earn Phantom Units to Eligible Employees, Officers, Executive Officers and 
Eligible Non-Employees. The Committee shall determine the criteria for the 
earning of Phantom Units, pursuant to Section III of the Plan. Upon 
satisfaction of such criteria, a Phantom Unit shall be deemed a Vested Award. 
A Phantom Unit granted by the Committee shall provide for payment in shares 
of Common Stock. A Phantom Unit shall become a Vested Award upon (i) a 
Participant becoming Disabled, or (ii) the death of a Participant. Shares of 
Common Stock issued pursuant to this Section XIII may be issued for no cash 
consideration or for such minimum consideration as may be required by 
applicable law or such other consideration as may be determined by the 
Committee. The Committee shall determine whether a Participant granted a 
Phantom Unit shall be entitled to a Dividend Equivalent Right.
 
     B.  UNFUNDED CLAIM.  The establishment of Phantom Units under the Plan 
are unfunded obligations of the Company. The interest of a Participant in any 
such units shall be considered a general unsecured claim against the Company 
to the extent that the conditions for the earning of the Phantom Units have 
been satisfied. Nothing contained herein shall be construed as creating a 
trust or fiduciary relationship between the Participant, the Company or the 
Committee.
 
     C.  ISSUANCE OF COMMON STOCK.  Upon a Phantom Unit becoming a Vested 
Award, unless a Participant has elected to defer under Paragraph D. below, 
shares of Common Stock representing the Phantom Units shall be distributed to 
the Participant, unless the Committee, with the consent of the Participant, 
provides for the payment of the Phantom Units in cash or partly in cash and 
partly in shares of Common Stock equal to the value of the shares of Common 
Stock which would otherwise be distributed to the Participant.
 
     D.  DEFERRAL OF PHANTOM UNITS.  Prior to the year with respect to which 
a Phantom Unit may become a Vested Award, the Participant may elect not to 
receive Common Stock upon the vesting of such Phantom Unit and for the 
Company to continue to maintain the Phantom Unit on its books of account. In 
such event, the value of a Phantom Unit shall be payable in shares of Common 
Stock pursuant to the agreement of deferral.
 
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<PAGE>

     E.  FINANCIAL HARDSHIP.  Notwithstanding any other provision hereof, at 
the written request of a Participant who has elected to defer pursuant to 
Paragraph D. above, the Committee, in its sole direction, upon a finding that 
continued deferral will result in financial hardship to the Participant, may 
authorize the payment of all or a part of a Participant's Vested Phantom 
Units in a single installment or the acceleration of payment of any multiple 
installments thereof; provided, however, that distributions will not be made 
under this paragraph if such distribution would result in liability of an 
Executive Officer under Section 16 of the Exchange Act.
 
     F.  DISTRIBUTION UPON DEATH.  The Committee shall pay the Fair Market 
Value of the Phantom Units of a deceased Participant to the estate of the 
Participant, as soon as practicable following the death of the Participant. 
The value of the Phantom Units for the purpose of such distribution shall be 
based upon the Fair Market Value of shares of Common Stock underlying the 
Phantom Units on the date of the Participant's death.
 
XIV. STOCK AWARDS TO NON-EMPLOYEE DIRECTORS.
 
     On the date of his or her admission to the Board, or in the case of 
existing Non-Employee directors, as of the first meeting of the Board that 
follows the date of this Prospectus, each Non-Employee Director shall be 
granted a Stock Award consisting of 1,000 shares of Common Stock, without 
restrictions, and 5,000 shares of Restricted Stock, which shall become Vested 
in 20% annual increments.
 
XV.  OUTSIDE DIRECTOR'S COMPENSATION.
 
     A.  PAYMENT IN COMMON STOCK OR OPTIONS.  Each Non-Employee Director may 
elect to receive payment of all or any portion of Director Compensation 
comprised of retainer fees for service on the Board and any committees 
thereof in Common Stock or Options to purchase Common Stock. The amount of 
Common Stock or Options then issuable shall be based on the Fair Market Value 
of the Common Stock or the Company's standard Black-Scholes option pricing 
model, as applicable, on the dates such retainer fees are otherwise due and 
payable to the Non-Employee Director. When any fees are paid in Common Stock 
under this Section XV.A, any fractional shares of Common Stock shall be paid 
in cash. Certificates evidencing such Common Stock shall be delivered 
promptly following such date.
 
     B.  DEFERRAL OF PAYMENT.  Each Non-Employee Director may elect to defer 
the receipt of Common Stock payable pursuant to Section XV.A, in which event 
such Non-Employee Director shall receive an equivalent number of Phantom 
Units with Dividend Equivalent Rights. Any such Phantom Units shall become 
Vested Awards at such time as the Non-Employee Director no longer serves as a 
member of the Board. If a Non-Employee Director elects to defer receipt of 
Common Stock and receive Phantom Units pursuant to this Section XV.B, the 
election shall be (i) in writing, (ii) delivered to the Secretary of the 
Company in the year preceding the year in which the Director Compensation 
would otherwise be paid (or, for a Director's initial calendar year of 
service, delivered prior to the date for which such services are rendered) 
and (iii) irrevocable.
 
     C.  DIRECTOR STOCK OPTIONS.  On the date of his or her admission to the 
Board, or in the case of existing Non-Employee Directors, as of the first 
meeting of the Board that follows the date of this Prospectus, each 
Non-Employee Director shall be granted an Option to purchase forty-two 
thousand (42,000) shares Common Stock. When such Option has become a Vested 
Option, the Non-Employee Director holding such Option shall be entitled, as 
of the first day of each calendar year thereafter, to a further Option having 
a value equal to $112,000 (as determined in accordance with the Company's 
standard Black-Scholes option pricing model). Any Option issued pursuant to 
this Section XV.C is (i) to become a Vested Option in annual one-third 
increments following the date of grant or, if earlier, in full upon the 
retirement of the Director, (ii) to remain exercisable notwithstanding the 
retirement of the Director from the Board (but in no event after the 
expiration date of the Option), and (iii) to expire ten years from the date 
of grant.
 
XVI. FEDERAL SECURITIES LAW.
 
     With respect to grants of Awards to Directors and Executive Officers, 
the Company intends that the provisions of this Plan and all transactions 
effected in accordance with Plan shall comply with Rule 16b-3 under the 
Exchange Act. Accordingly, the Committee shall administer and interpret the 
Plan to the extent practicable, to maintain compliance with such rule.
 
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XVII.  CHANGE OF CONTROL; ACCELERATION.
 
     Upon the occurrence of a Change of Control:
 
     A. in the case of all outstanding Options and SARs, each such Option and 
SAR shall automatically become immediately fully exercisable by the 
Participant unless the Committee shall otherwise determine at the time such 
Option or SAR is granted as set forth in the respective grant Agreement;
 
     B. restrictions applicable to Restricted Stock shall automatically be 
deemed lapsed and conditions applicable to Phantom Units shall automatically 
be deemed waived, and the Participants who receive such grants shall become 
immediately entitled to receipt of the Common Stock subject to such grants; 
and
 
     C. the Human Resources Committee, in its discretion, shall have the 
right to accelerate payment of any deferrals of Vested Phantom Units.
 
XVIII.  ADJUSTMENT OF SHARES.
 
     A.  In the event there is any change in the Common Stock by reason of 
any consolidation, combination, liquidation, reorganization, 
recapitalization, stock dividend, stock split, split-up, split-off, spin-off, 
combination of shares, exchange of shares or other like change in capital 
structure of the Company, the number or kind of shares or interests subject 
to an Award and the per share price or value thereof shall be appropriately 
adjusted by the Committee at the time of such event, provided that each 
Participant's economic position with respect to the Award shall not, as a 
result of such adjustment, be worse than it had been immediately prior to 
such event. Any fractional shares or interests resulting from such adjustment 
shall be rounded up to the next whole share of Common Stock. Notwithstanding 
the foregoing, (i) each such adjustment with respect to an Incentive Option 
shall comply with the rules of Section 424(a) of the Code, and (ii) in no 
event shall any adjustment be made which would render any Incentive Option 
granted hereunder other than an "incentive stock option" for purposes of 
Section 422 of the Code.
 
     B.  In the event of an acquisition by the Company of another corporation 
where the Company assumes outstanding stock options or similar obligations of 
such corporation, the number of Awards available under the Plan shall be 
appropriately increased to reflect the number of such options or other 
obligations assumed.
 
XIX.  MISCELLANEOUS PROVISIONS.
 
     A.  ASSIGNMENT OR TRANSFER.  Except as otherwise permitted by this 
Section, no grant of any "derivative security" (as defined in the rules 
issued under Section 16 of the Exchange Act) made under the Plan or any 
rights or interests therein shall be assignable or transferable except by 
last will and testament or the laws of descent and distribution. No grant of 
any such derivative security shall be assignable or transferrable pursuant to 
a domestic relations order. An Optionee who is an Officer or a Non-Employee 
Director may assign or transfer an Option (other than an Incentive Option) or 
a SAR as a gift to one or more members of his or her immediate family or to 
trusts maintained for the benefit of such immediate family members if such 
assignment or transfer is not pursuant to a domestic relations order and (i) 
such assignment or transfer is expressly approved in advance by the Committee 
or its delegate(s) or (ii) such Option or SAR was granted to the Optionee on 
or after August 15, 1996, and the Agreement pertaining to such Option or SAR 
expressly permits the assignment or transfer of the Option or SAR.
 
     B.  INVESTMENT REPRESENTATION; LEGENDS.  The Committee may require each 
Participant acquiring shares of Common Stock pursuant to an Award to 
represent to and agree with the Company in writing that such Participant is 
acquiring the shares without a view to distribution thereof. No shares of 
Common Stock shall be issued pursuant to an Award until all applicable 
securities law and other legal and stock exchange requirements have been 
satisfied. The Committee may require the placing of stop-orders and 
restrictive legends on certificates for Common Stock as it deems appropriate.
 
     C.  WITHHOLDING TAXES.  In the case of distributions of Common Stock or 
other securities hereunder, the Company, as a condition of such distribution, 
may require the payment (through withholding from the Participant's salary, 
payment of cash by the Participant, reduction of the number of shares of 
Common Stock or other securities to be issued (except in the case of an 
Incentive Option), or otherwise) of any federal, state, local or foreign 
taxes required by law to be withheld with respect to such distribution.
 
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     D.  COSTS AND EXPENSES.  The costs and expenses of administering the 
Plan shall be borne by the Company and shall not be charged against any Award 
nor to any Participant receiving an Award.
 
     E.  OTHER INCENTIVE PLANS.  The adoption of the Plan does not preclude 
the adoption by appropriate means of any other incentive plan for employees.
 
     F.  EFFECT ON EMPLOYMENT.  Nothing contained in the Plan or any 
agreement related hereto or referred to herein shall affect, or be construed 
as affecting, the terms of employment of any Participant except to the extent 
specifically provided herein or therein. Nothing contained in the Plan or any 
agreement related hereto or referred to herein shall impose, or be construed 
as imposing, an obligation on (i) the Company or any Related Entity to 
continue the employment of any Participant and (ii) any Participant to remain 
in the employ of the Company or any Related Entity.
 
     G.  NONCOMPETITION.  Any Agreement may contain, among other things, 
provisions prohibiting Participants from competing with the Company or any 
Related Entity in a form or forms acceptable to the Committee, in its sole 
discretion.
 
     H.  GOVERNING LAW.  This Plan and actions taken in connection herewith 
shall be governed and construed in accordance with the laws of the State of 
Colorado.
 
XX.  AMENDMENT OR TERMINATION OF PLAN.
 
     The Board shall have the right to amend, modify, suspend or terminate 
the Plan at any time, provided that, with respect to Incentive Options, no 
amendment shall be made that (i) decreases the minimum Option Price in the 
case of any Incentive Option, or (ii) modifies the provisions of the Plan 
with respect to Incentive Options, unless such amendment is made by or with 
the approval of the stockholders or unless the Board receives an opinion of 
counsel to the Company that stockholder approval is not necessary with 
respect to any modifications relating to Incentive Options; and provided 
further that no amendment shall be made that (i) increases the number of 
shares of Common Stock that may be issued under the Plan, (ii) permits the 
Option Price for any Option to be less than Fair Market Value on the date 
such Option is granted, or (iii) extends the period during which awards may 
be granted under the Plan beyond ten (10) years from the Effective Date, 
unless such amendment is made by or with the approval of stockholders. No 
amendment, modification, suspension or termination of the Plan shall alter or 
impair any Awards previously granted under the Plan, without the consent of 
the holder thereof.

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