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                                                                    EXHIBIT 10.3



                    PROGRESS SOFTWARE CORPORATION 401(k) PLAN
                          (January 1, 1996 Restatement)



Fidelity Management Trust Company, its affiliates and employees may not provide
you with legal or tax advice in connection with the execution of this document.
It should be reviewed by your attorney and/or accountant prior to execution.

                        CORPORATE plan for RETIREMENT(TM)
                                VOLUME SUBMITTER

                            PLAN DOCUMENT SYSTEMS(TM)

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                                TABLE OF CONTENTS

                                    PREAMBLE

                                    ARTICLE I
                                   DEFINITIONS

1.1   Plan Definitions.........................................................8
1.2   Interpretation..........................................................12

                                   ARTICLE II
                                     SERVICE

2.1   Definitions.............................................................13
2.2   Crediting of Hours of Service...........................................13
2.3   Crediting of Continuous Service.........................................13
2.4   Eligibility Service.....................................................14
2.5   Vesting Service.........................................................14
2.6   Crediting of Service on Transfer or Amendment...........................10

                                   ARTICLE III
                                   ELIGIBILITY

3.1   Eligibility.............................................................15
3.2   Transfers of Employment.................................................15
3.3   Reemployment............................................................15
3.4   Notification Concerning New Eligible Employees..........................15
3.5   Effect and Duration.....................................................15

                                   ARTICLE IV
                           TAX-DEFERRED CONTRIBUTIONS

4.1   Tax-Deferred Contributions..............................................16
4.2   Amount of Tax-Deferred Contributions....................................16
4.3   Changes in Reduction Authorization......................................16
4.4   Suspension of Tax-Deferred Contributions................................17
4.5   Resumption of Tax-Deferred Contributions................................17
4.6   Delivery of Tax-Deferred Contributions..................................17
4.7   Vesting of Tax-Deferred Contributions...................................17

                                    ARTICLE V
                      AFTER-TAX AND ROLLOVER CONTRIBUTIONS

5.1   No After-Tax Contributions..............................................18
5.2   Rollover Contributions..................................................18
5.3   Vesting of Rollover Contributions.......................................18

                                   ARTICLE VI
                             EMPLOYER CONTRIBUTIONS

6.1   Contributions Period....................................................19

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6.2   Profit-Sharing Contributions............................................19
6.3   Allocation of Profit-Sharing Contributions..............................19
6.4   Matching Contributions..................................................19
6.5   Allocation of Matching Contributions....................................19
6.6   Verification of Amount of Employer Contributions by the Sponsor.........20
6.7   Payment of Employer Contributions.......................................20
6.8   Eligibility to Participate in Allocation................................20
6.9   Vesting of Employer Contributions.......................................20
6.10  Election of Former Vesting Schedule.....................................21
6.11  Forfeitures to Reduce Employer Contributions............................21

                                   ARTICLE VII
                          LIMITATIONS ON CONTRIBUTIONS

7.1   Definitions.............................................................22
7.2   Code Section 402(g) Limit...............................................24
7.3   Distribution of Excess Deferrals........................................24
7.4   Limitation on Tax-Deferred Contributions of Highly Compensated
      Employees...............................................................25
7.5   Distribution of Excess Tax-Deferred Contributions.......................26
7.6   Limitation on Matching Contributions of Highly Compensated Employees....26
7.7   Forfeiture or Distribution of Excess Contributions......................27
7.8   Multiple Use Limitation.................................................28
7.9   Determination of Income or Loss.........................................28
7.10  Code Section 415 Limitations on Crediting of Contributions and
      Forfeitures.............................................................28
7.11  Coverage Under Other Qualified Defined Contribution Plan................29
7.12  Coverage Under Qualified Defined Benefit Plan...........................30
7.13  Scope of Limitations....................................................30

                                  ARTICLE VIII
                        TRUST FUNDS AND SEPARATE ACCOUNTS

8.1   General Fund............................................................31
8.2   Investment Funds........................................................31
8.3   Loan Investment Fund....................................................31
8.4   Income on Trust.........................................................31
8.5   Separate Accounts.......................................................31
8.6   Sub-Accounts............................................................32

                                   ARTICLE IX
                            LIFE INSURANCE CONTRACTS

9.1   No Life Insurance Contracts.............................................33

                                    ARTICLE X
                     DEPOSIT AND INVESTMENT OF CONTRIBUTIONS

10.1  Future Contribution Investment Elections................................34
10.2  Deposit of Contributions................................................34
10.3  Election to Transfer Between Funds......................................34

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                                   ARTICLE XI
                     CREDITING AND VALUING SEPARATE ACCOUNTS

11.1  Crediting Separate Accounts.............................................35
11.2  Valuing Separate Accounts...............................................35
11.3  Plan Valuation Procedures...............................................35
11.4  Finality of Determinations..............................................36
11.5  Notification............................................................36

                                   ARTICLE XII
                                      LOANS

12.1  Application for Loan....................................................37
12.2  Reduction of Account Upon Distribution..................................37
12.3  Requirements to Prevent a Taxable Distribution..........................37
12.4  Administration of Loan Investment Fund..................................38
12.5  Default.................................................................38
12.6  Special Rules Applicable to Loans.......................................38
12.7  Loans Granted Prior to Amendment........................................39

                                  ARTICLE XIII
                           WITHDRAWALS WHILE EMPLOYED

13.1  Withdrawals of Rollover Contributions...................................40
13.2  Withdrawals of Tax-Deferred Contributions...............................40
13.3  Conditions and Limitations on Hardship Withdrawals......................40
13.4  Order of Withdrawal from a Participant's Sub-Accounts...................41

                                   ARTICLE XIV
                  TERMINATION OF EMPLOYMENT AND SETTLEMENT DATE

14.1  Termination of Employment and Settlement Date...........................42
14.2  Separate Accounting for Non-Vested Amounts..............................42
14.3  Disposition of Non-Vested Amounts.......................................42
14.4  Recrediting of Forfeited Amounts........................................43

                                   ARTICLE XV
                                  DISTRIBUTIONS

15.1  Distributions to Participants...........................................44
15.2  Distributions to Beneficiaries..........................................44
15.3  Cash Outs and Participant Consent.......................................44
15.4  Required Commencement of Distribution...................................45
15.5  Reemployment of a Participant...........................................45
15.6  Restrictions on Alienation..............................................45
15.7  Facility of Payment.....................................................46
15.8  Inability to Locate Payee...............................................46
15.9  Distribution Pursuant to Qualified Domestic Relations Orders............46

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                                   ARTICLE XVI
                                 FORM OF PAYMENT

16.1  Definitions.............................................................47
16.2  Normal Form of Payment..................................................48
16.3  Optional Form of Payment................................................48
16.4  Change of Option Election...............................................48
16.5  Form of Annuity Requirements............................................48
16.6  Qualified Preretirement Survivor Annuity Requirements...................49
16.7  Direct Rollover.........................................................49
16.8  Notice Regarding Forms of Payment.......................................50
16.9  Reemployment............................................................51

                                  ARTICLE XVII
                                  BENEFICIARIES

17.1  Designation of Beneficiary..............................................52
17.2  Spousal Consent Requirements............................................52

                                  ARTICLE XVIII
                                 ADMINISTRATION

18.1  Authority of the Sponsor................................................53
18.2  Action of the Sponsor...................................................53
18.3  Claims Review Procedure.................................................53
18.4  Qualified Domestic Relations Orders.....................................54
18.5  Indemnification.........................................................54
18.6  Actions Binding.........................................................55

                                   ARTICLE XIX
                            AMENDMENT AND TERMINATION

19.1  Amendment...............................................................56
19.2  Limitation on Amendment.................................................56
19.3  Termination.............................................................56
19.4  Reorganization..........................................................57
19.5  Withdrawal of an Employer...............................................57

                                   ARTICLE XX
                           ADOPTION BY OTHER ENTITIES

20.1  Adoption by Related Companies...........................................59
20.2  Effective Plan Provisions...............................................59

                                   ARTICLE XXI
                            MISCELLANEOUS PROVISIONS

21.1  No commitment as to Employment..........................................60
21.2  Benefits................................................................60
21.3  No Guarantees...........................................................60
21.4  Expenses................................................................60

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21.5  Precedent...............................................................60
21.6  Duty to Furnish Information.............................................60
21.7  Withholding.............................................................60
21.8  Merger, Consolidation, or Transfer of Plan Assets.......................61
21.9  Back Pay Awards.........................................................61
21.10 Condition on Employer Contributions.....................................61
21.11 Return of Contributions to an Employer..................................61
21.12 Validity of Plan........................................................62
21.13 Trust Agreement.........................................................62
21.14 Parties Bound...........................................................62
21.15 Application of Certain Plan Provisions..................................62
21.16 Leased Employees........................................................62
21.17 Transferred Funds.......................................................63

                                  ARTICLE XXII
                              TOP-HEAVY PROVISIONS

22.1  Definitions.............................................................64
22.2  Applicability...........................................................66
22.3  Minimum Employer Contribution...........................................66
22.4  Adjustments to Section 415 Limitations..................................66
22.5  Accelerated Vesting.....................................................66

                                  ARTICLE XXIII
                                 EFFECTIVE DATE

23.1  Effective Date of Amendment and Restatement.............................68


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                                    PREAMBLE

The Progress Software Corporation 401(k) Plan, originally effective as of
September 1, 1991, is hereby amended and restated in its entirety. The Plan, as
amended and restated hereby, is intended to qualify as a profit-sharing plan
under Section 401(a) of the Code, and includes a cash or deferred arrangement
that is intended to qualify under Section 401(k) of the Code. The Plan is
maintained for the exclusive benefit of eligible employees and their
beneficiaries.

Notwithstanding any other provision of the Plan to the contrary, a Participant's
vested interest in his Separate Account under the Plan on and after the
effective date of this amendment and restatement shall be not less than his
vested interest in his account on the day immediately preceding the effective
date. In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Plan provisions that were available
under the Plan immediately prior to the later of the effective date of this
amendment and restatement or the date this amendment and restatement is adopted
and that may not be eliminated under Section 411(d) (6) of the Code shall
continue to be available to Participants who had an account under the Plan on
the day immediately preceding the later of the effective date or the date this
amendment and restatement is adopted.



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                                    ARTICLE I
                                   DEFINITIONS

1.1  Plan Definitions

As used herein, the following words and phrases have the meanings hereinafter
set forth, unless a different meaning is plainly required by the context:

The "Administrator" means the Sponsor unless the Sponsor designates another
person or persons to act as such.

An "After-Tax Contribution" means any after-tax employee contribution made by a
Participant as may be permitted under Article V.

The "Beneficiary" of a Participant means the person or persons entitled under
the provisions of the Plan to receive distribution hereunder in the event the
Participant dies before receiving distribution of his entire interest under the
Plan.

The "Code" means the Internal Revenue Code of 1986, as amended from time to
time. Reference to a section of the Code includes such section and any
comparable section or sections of any future legislation that amends,
supplements, or supersedes such section.

The "Compensation" of a Participant for any period means the wages as defined in
Section 3401(a) of the Code, determined without regard to any rules that limit
compensation included in wages based on the nature or location of the employment
or services performed, and all other payments made to him for such period for
services as an Employee for which his Employer is required to furnish the
Participant a written statement under Sections 6041 (d), 6051 (a) (3), and 6052
of the Code, and excluding reimbursements or other expense allowances, fringe
benefits, moving expenses, deferred compensation, and welfare benefits, but
determined prior to any exclusions for amounts deferred under Section 125,
402(e) (3), 402(h) (1) (B), 403(b), or 457(b) of the Code or for certain
contributions described in Section 414(h) (2) of the Code that are picked up by
the employing unit and treated as employer contributions.

Notwithstanding the foregoing, Compensation shall not include the following:

     -    overtime pay
     -    the value of any qualified or non-qualified stock option granted to
          the Participant by his Employer to the extent such value is includible
          in the Participant's taxable income.

In no event, however, shall the Compensation of a Participant taken into account
under the Plan for any Plan Year exceed (1) $200,000 for Plan Years beginning
prior to January 1, 1994, or (2) $150,000 for Plan Years beginning on or after
January1, 1994 (subject to adjustment annually as provided in Section 401(a)
(17) (B) and Section 415 (d) or the Code; provided, however, that the dollar
increase in effect on January 1 of any calendar year, if any, is effective for
Plan Years beginning in such calendar year). If the Compensation of a
Participant is determined over a period of time that contains fewer than 12
calendar months, then the annual compensation limitation described above shall
be adjusted with respect to that Participant by multiplying the annual
compensation limitation in effect for the Plan Year by a fraction the numerator
of which is the number of full months in the period and the denominator of which
is 12; provided, however, that no proration is required for a Participant who is
covered under the Plan for less than one full

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Plan Year if the formula for allocations is based on Compensation for a period
of at least 12 months. In determining the Compensation, for purposes of applying
the annual compensation limitation described above, of a Participant who is a
five percent owner or among the ten Highly Compensated Employees receiving the
greatest Compensation for the Plan Year, the Compensation of the Participant's
spouse and of his lineal descendants who have not attained age 19 as of the
close of the Plan Year shall be included as Compensation of the Participant for
the Plan Year. If as a result of applying the family aggregation rule described
in the preceding sentence the annual compensation limitation would be exceeded,
the limitation shall be prorated among the affected family members in proportion
to each member's Compensation as determined prior to application of the family
aggregation rules.

A "Contribution Period" means the period specified in Article VI for which
Employer Contributions shall be made.

An "Eligible Employee" means any Employee who has met the eligibility
requirements of Article III to have Tax-Deferred Contributions made to the Plan
on his behalf.

The "Eligibility Service" of any employee means the period or periods of service
credited to him under the provisions of Article II for purposes of determining
his eligibility to participate in the Plan as may be required under Article III
or Article VI.

An "Employee" means any employee of an Employer other than a leased employee or
an employee who is covered by a collective bargaining agreement that does not
specifically provide for coverage under the Plan.

An "Employer" means the Sponsor and any entity which has adopted the Plan as may
be provided under Article XX.

An "Employer Contribution" means the amount, if any, than an Employer
contributes to the Plan as may be provided under Article VI or Article XXII.

An "Enrollment Date" means the first day of each calendar month of the Plan
Year.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time. Reference to a section of ERISA includes such section and any
comparable section or sections of any future legislation that amends,
supplements, or supersedes such section.

The "General Fund" means a Trust Fund maintained by the Trustee as required to
hold and administer any assets of the Trust that are not allocated among any
separate Investment Funds as may be provided in the Plan or the Trust Agreement.
No General Fund shall be maintained if all assets of the trust are allocated
among separate Investment Funds.

A "Highly Compensated Employee" means an Employee or former Employee who is a
highly compensated active employee or highly compensated former employee as
defined hereunder.

A "highly compensated active employee" includes any Employee who performs
services for an Employer during the determination year and who (i) was a five
percent owner at any time during the determination year or the look back year,
(ii) received compensation from an Employer during the look back year in excess
of $75,000 (subject to adjustment annually at the same time and in the same
manner as under Section 415(d) of the Code), (iii) was in the top paid group of
employees for the look back year and received compensation from an Employer
during the look

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back year in excess of $50,000 (subject to adjustment annually at the same time
and in the same manner as under Section 415(d) of the Code), (iv) was an officer
of an Employer during the look back year and received compensation during that
year in excess of 50 percent of the dollar limitation in effect for that year
under Section 415(b) (1) (A) of the Code or, if no officer received compensation
in excess of that amount for the look back year or the determination year,
received the greatest compensation for the look back year of any officer, or (v)
was one of the 100 employees paid the greatest compensation by an Employer for
the determination year and would be described in (ii), (iii), or (iv) above if
the term "determination year" were substituted for "look back year".

A "highly compensated former employee" includes any Employee who separated from
service from an Employer and all Related Companies (or is deemed to have
separated from service from an Employer and all Related Companies) prior to the
determination year, and was a highly compensated active employee for either the
separation year or any determination year ending on or after the date the
Employee attains age 55.

The determination of who is a Highly Compensated Employee hereunder, including
determinations as to the number and identity of employees in the top paid group,
the 100 employees receiving the greatest compensation from an Employer, the
number of employees treated as officers, and the compensation considered, shall
be made in accordance with the provisions of Section 414 (q) of the Code and
regulations issued thereunder. For purposes of this definition, the following
terms have the following meanings:

(a)  The "determination year" means the Plan Year or, if the Administrator makes
     the election provided in paragraph (b) below, the period of time, if any,
     which extends beyond the look back year and ends on the last day of the
     Plan Year for which testing is being performed (the "lag period"). If the
     lag period is less than 12 months long, the dollar amounts specified in
     (ii), (iii), and (iv) above shall be prorated based upon the number of
     months in the lag period.

(b)  The "look back year" means the 12-month period immediately preceding the
     determination year; provided, however, that the Administrator may elect
     instead to treat the calendar year ending with or within the determination
     year as the "look back year".

An "Hour of Service" with respect to a person means each hour, if any, that may
be credited to him in accordance with the provisions of Article II.

An "Investment Fund" means any separate investment Trust Fund maintained by the
Trustee as may be provided in the Plan or the Trust Agreement or any separate
investment fund maintained by the Trustee, to the extent that there are
Participant Sub Accounts under such funds, to which assets of the Trust may be
allocated and separately invested.

A Matching Contribution" means any Employer Contribution made to the Plan on
account of a Participant's Tax-Deferred Contributions as provided in Article VI.

The "Normal Retirement Date" of an employee means the date he attains age 65.

A "Participant" means any person who has a Separate Account in the Trust.

The "Plan" means Progress Software Corporation 401(k) Plan, as from time to time
in effect.

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A "Plan Year" means the 12 consecutive month period ending December 31.

A "Profit-Sharing Contribution" means any Employer Contribution made to the Plan
as provided in Article VI.

A "Related Company" means any corporation or business, other than an Employer,
which would be aggregated with an Employer for a relevant purpose under Section
414 of the Code.

A "Rollover Contribution" means any rollover contribution to the Plan made by a
Participant as may be permitted under Article V.

A "Separate Account" means the account maintained by the Trustee in the name of
a Participant that reflects his interest in the Trust and any Sub-Accounts
maintained thereunder, as provided in Article VIII.

The "Settlement Date" of a Participant means the date on which a Participant's
interest under the Plan becomes distributable in accordance with Article XV.

The "Sponsor" means Progress Software Corporation, and any successor thereto.

A "Sub-Account" means any of the individual sub-accounts of a Participant's
Separate Account that is maintained as provided in Article VIII.

A "Tax-Deferred Contribution" means the amount contributed to the Plan on a
Participant's behalf by his Employer in accordance with his reduction
authorization executed pursuant to Article IV.

The "Trust" means the trust maintained by the Trustee under the Trust Agreement.

The "Trust Agreement" means the agreement entered into between the Sponsor and
the Trustee relating to the holding, investment, and reinvestment of the assets
of the Plan, together with all amendments thereto.

The "Trustee" means the trustee or any successor trustee which at the time shall
be designated, qualified, and acting under the Trust Agreement. The Sponsor may
designate a person or persons other than the Trustee to perform any
responsibility of the Trustee under the Plan, other than trustee
responsibilities as defined in Section 405 (c) (3) of ERISA, and the Trustee
shall not be liable for the performance of such person in carrying out such
responsibility except as otherwise provided by ERISA. The term Trustee shall
include any delegate of the Trustee as may be provided in the Trust Agreement.

A "Trust Fund" means any fund maintained under the trust by the Trustee.

A "Valuation Date" means the date or dates designated by the Sponsor and
communicated in writing to the Trustee for the purpose of valuing the General
Fund and each Investment Fund and adjusting Separate Accounts and Sub-Accounts
hereunder, which dates need not be uniform with respect to the General Fund,
each Investment Fund, Separate Account, or Sub-Account; provided, however, that
the General Fund and each Investment Fund shall be valued and each Separate
Account and Sub-Account shall be adjusted no less often than once annually.

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The "Vesting Service" of an employee means the period or periods of service
credited to him under the provisions of Article II for purposes of determining
his vested interest in his Employer Contributions Sub-Account, if Employer
Contributions are provided for under either Article VI or Article XXII.

1.2  Interpretation

Where required by the context, the noun, verb, adjective, and adverb forms of
each defined term shall include any of its other forms. Wherever used herein,
the masculine pronoun shall include the feminine, the singular shall include the
plural, and the plural shall include the singular.



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                                   ARTICLE II
                                     SERVICE

2.1  Definitions

For purposes of this Article, the following terms have the following meanings:

(a)  The "continuous service" of an employee means the service credited to him
     in accordance with the provisions of Section 2.3 of the Plan.

(b)  The "employment commencement date" of an employee means the date he first
     completes an Hour of Service.

(c)  A "maternity/paternity absence" means a person's absence from employment
     with an Employer or a Related Company because of the person's pregnancy,
     the birth of the person's child, the placement of a child with the person
     in connection with the person's adoption of the child, or the caring for
     the person's child immediately following the child's birth or adoption. A
     person's absence from employment will not be considered a
     maternity/paternity absence unless the person furnishes the Administrator
     such timely information as may reasonably be required to establish that the
     absence was for one of the purposes enumerated in this paragraph and to
     establish the number of days of absence attributable to such purpose.

(d)  The "reemployment commencement date" of an employee means the first date
     following a severance date on which he again completes an Hour of Service.

(e)  The "severance date" of an employee means the earlier of (i) the date on
     which he retires, dies, or his employment with an Employer and all Related
     Companies is otherwise terminated, or (ii) the first anniversary of the
     first date of a period during which he is absent from work with an Employer
     and all Related Companies for any other reason; provided, however, that if
     he terminates employment with or is absent from work with an Employer and
     all Related Companies on account of service with the armed forces of the
     United States, he shall not incur a severance date if he is eligible for
     reemployment rights under the Uniformed Services Employment and
     Reemployment Rights Act of 1994 and he returns to work with an Employer or
     a Related Company within the period during which he retains such
     reemployment rights.

2.2  Crediting of Hours of Service

A person shall be credited with an Hour of Service for each hour for which he is
paid, or entitled to payment, for the performance of duties for an Employer or
any Related Company.

2.3  Crediting of Continuous Service

A person shall be credited with continuous service for the aggregate of the
periods of time between his employment commencement date or any reemployment
commencement date and the severance date that next follows such employment
commencement date or reemployment commencement date; provided, however, that an
employee who has a reemployment commencement date within the
12-consecutive-month period following the earlier of the first date of his
absence or his severance date shall be credited with continuous service for the
period between such severance date and reemployment commencement date.

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2.4  Eligibility Service

There shall be no Eligibility Service credited under the Plan.

2.5  Vesting Service

Years of Vesting Service shall be determined in accordance with the following
provisions:

(a)  An employee shall be credited with years of Vesting Service equal to his
     period of continuous service.

(b)  Notwithstanding the provisions of paragraph (a), continuous service
     completed by an employee prior to a severance date shall not be included in
     determining the employee's years of Vesting Service unless the employee had
     a nonforfeitable right to any portion of his Separate Account, excluding
     that portion of his Separate Account that is attributable to Rollover
     Contributions, as of the severance date, or the period of time between the
     severance date and his reemployment commencement date is less than the
     greater of five years or his period of continuous service determined as of
     the severance date; provided, however, that solely for purposes of applying
     this paragraph, if a person is on a maternity/paternity absence beyond the
     first anniversary of the first day of such absence, his severance date
     shall be the second anniversary of the first day of such
     maternity/paternity absence.

2.6  Crediting of Service on Transfer or Amendment

Notwithstanding any other provision of the Plan to the contrary, if an Employee
is transferred from employment covered under a qualified plan maintained by an
Employer or a Related Company for which service is credited based on Hours of
Service and computation periods in accordance with Department of Labor
Regulations 2530.200 through 2530.203 to employment covered under the Plan or,
prior to amendment, the Plan provided for crediting of service on the basis of
Hours of Service and computation periods, an affected Employee shall be credited
with Vesting Service hereunder equal to:

(a)  the Employee's years of service credited to him under the Hours of Service
     method before the computation period in which the transfer or the effective
     date of the amendment occurs, plus

(b)  the greater of (i) the period of service that would be credited to the
     Employee under the elapsed time method provided hereunder for his
     employment during the entire computation period in which the transfer or
     the effective date of the amendment occurs or (ii) the service taken into
     account under the Hours of Service method for such computation period as of
     the transfer date or the effective date of the amendment, plus

(c)  the service credited to such Employee under the elapsed time method
     provided hereunder for the period of time beginning on the day after the
     last day of the computation period in which the transfer or the effective
     date of the amendment occurs.

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                                   ARTICLE III
                                   ELIGIBILITY

3.1  Eligibility

Each Employee who was an Eligible Employee immediately prior to the effective
date of this amendment and restatement shall continue to be an Eligible
Employee. Each other Employee shall become an Eligible Employee as of the
Enrollment Date coinciding with or next following the date on which he becomes
an Employee.

3.2  Transfers of Employment

If a person is transferred directly from employment with an Employer or with a
Related Company in a capacity other than as an Employee to employment as an
Employee, he shall become an Eligible Employee as of the later of the date he is
so transferred or the date he would have become an Eligible Employee if he had
been an Employee for his entire period of employment with the Employer or
Related Company.

3.3  Reemployment

If a person who terminated employment with an Employer and all Related Companies
is reemployed as an Employee and if he had been an Eligible Employee prior to
his termination of employment, he shall again become an Eligible Employee on the
date he is reemployed. Otherwise, the eligibility of a person who terminated
employment with an Employer and all Related Companies and who is reemployed by
an Employer or a Related Company to elect to have Tax-Deferred Contributions
made to the Plan on his behalf shall be determined in accordance with Section
3.1 or 3.2.

3.4  Notification Concerning New Eligible Employees

Each Employer shall notify the Administrator as soon as practicable of Employees
becoming Eligible Employees as of any date.

3.5  Effect and Duration

Upon becoming an Eligible Employee, an Employee shall be entitled to elect to
have Tax-Deferred Contributions made to the Plan on his behalf and shall be
bound by all the terms and conditions of the Plan and the Trust Agreement. A
person shall continue as an Eligible Employee eligible to have Tax-Deferred
Contributions made to the Plan on his behalf only so long as he continues
employment as an Employee.

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                                   ARTICLE IV
                           TAX-DEFERRED CONTRIBUTIONS

4.1  Tax-Deferred Contributions

Effective as of the date he becomes an Eligible Employee, or any subsequent
Enrollment Date, each Eligible Employee may elect in writing in accordance with
rules prescribed by the Administrator to have Tax-Deferred Contributions made to
the Plan on his behalf by his Employer as hereinafter provided. An Eligible
Employee's written election shall include his authorization for his Employer to
reduce his Compensation and to make Tax-Deferred Contributions on his behalf and
his election as to the investment of his contributions in accordance with
Article X. Tax-Deferred Contributions on behalf of an Eligible Employee shall
commence with the first payment of Compensation made on or after the date on
which his election is effective.

4.2  Amount of Tax-Deferred Contributions

The amount of Tax-Deferred Contributions to be made to the Plan on behalf of an
Eligible Employee by his Employer shall be an integral percentage of his
Compensation of not less than one percent nor more than 15 percent. In the event
an Eligible Employee elects to have his Employer make Tax-Deferred Contributions
on his behalf, his Compensation shall be reduced for each payroll period by the
percentage he elects to have contributed on his behalf to the Plan in accordance
with the terms of his currently effective reduction authorization.

Subject to the overall percentage limitations specified above, an Employer may
allow an Eligible Employee to authorize a special reduction in that portion of
his Compensation that is attributable to any Employer paid cash bonuses made for
such Eligible Employee for the Plan Year in an amount up to 100 percent of such
bonuses. The Employer may designate the bonuses for which the special reduction
authorization is available; provided, however, that such designation shall be
made on a uniform and non-discriminatory basis.

4.3  Changes in Reduction Authorization

An Eligible Employee may change the percentage of his future Compensation that
his Employer contributes on his behalf as Tax-Deferred Contributions at such
time or times during the Plan Year as the Administrator may prescribe by filing
an amended reduction authorization with his Employer such number of days prior
to the date such change is to become effective as the Administrator shall
prescribe. An Eligible Employee who changes his reduction authorization shall be
limited to selecting a percentage of his Compensation that is otherwise
permitted hereunder. Tax-Deferred Contributions shall be made on behalf of such
Eligible Employee by his Employer pursuant to his amended reduction
authorization filed in accordance with this Section commencing with Compensation
paid to the Eligible Employee on or after the date such filing is effective,
until otherwise altered or terminated in accordance with the Plan.

                                       16
<PAGE>   17

4.4  Suspension of Tax-Deferred Contributions

An Eligible Employee on whose behalf Tax-Deferred Contributions are being made
may have such contributions suspended at any time by giving such number of days
advance written notice to his Employer as the Administrator shall prescribe. Any
such voluntary suspension shall take effect commencing with Compensation paid to
such Eligible Employee on or after the expiration of the required notice period
and shall remain in effect until Tax-Deferred Contributions are resumed as
hereinafter set forth.

4.5  Resumption of Tax-Deferred Contributions

An Eligible Employee who has voluntarily suspended his Tax-Deferred
Contributions may have such contributions resumed at such time or times during
the Plan Year as the Administrator may prescribe, by filing a new reduction
authorization with his Employer such number of days prior to the date as of
which such contributions are to be resumed as the Administrator shall prescribe.

4.6  Delivery of Tax-Deferred Contributions

As soon after the date an amount would otherwise be paid to an Employee as it
can reasonably be separated from Employer assets, each Employer shall cause to
be delivered to the Trustee in cash all Tax-Deferred Contributions attributable
to such amounts.

4.7  Vesting of Tax-Deferred Contributions

A Participant's vested interest in his Tax-Deferred Contributions Sub-Account
shall be at all times 100 percent.


                                       17
<PAGE>   18

                                    ARTICLE V
                      AFTER-TAX AND ROLLOVER CONTRIBUTIONS

5.1  No After-Tax Contributions

There shall be no After-Tax Contributions made to the Plan.

5.2  Rollover Contributions

An Employee who was a participant in a plan qualified under Section 401 or 403
of the Code and who receives a cash distribution from such plan that he elects
either (i) to roll over immediately to a qualified retirement plan or (ii) to
roll over into a conduit IRA from which he receives a later cash distribution,
may elect to make a Rollover Contribution to the Plan if he is entitled under
Section 402 (c), Section 403(a) (4), or Section 408 (d) (3) (A) of the Code to
roll over such distribution to another qualified retirement plan. The
Administrator may require an Employee to provide it with such information as it
deems necessary or desirable to show that he is entitled to roll over such
distribution to another qualified retirement plan. An Employee shall make a
Rollover Contribution to the Plan by delivering, or causing to be delivered, to
the Trustee the cash that constitutes the Rollover Contribution amount within 60
days of receipt of the distribution from the plan or from the conduit IRA in the
manner prescribed by the Administrator. If the Employee does not already have an
investment election on file with the Administrator, the Employee shall also
deliver to the Administrator his election as to the investment of his
contributions in accordance with Article X.

5.3  Vesting of Rollover Contributions

A Participant's vested interest in his Rollover Contributions Sub-Account shall
be at all times 100 percent.


                                       18
<PAGE>   19

                                   ARTICLE VI
                             EMPLOYER CONTRIBUTIONS

6.1  Contribution Period

The Contribution Period for Employer Contributions under the Plan shall be each
Plan Year.

6.2  Profit-Sharing Contributions

Each Employer may, in its discretion, make a Profit-Sharing Contribution to the
Plan for the Contribution Period in an amount determined by the Sponsor.

6.3  Allocation of Profit-Sharing Contributions

Any Profit-Sharing Contribution made for a Contribution Period shall be
allocated among the Employees who are eligible to participate in the allocation
of Profit-Sharing Contributions for the Contribution Period, as determined under
this Article. The allocable share of each such Employee shall be in the ratio
which his Compensation from the Employers for the Contribution Period bears to
the aggregate of such Compensation for all such Employees.

6.4  Matching Contributions

Each Employer may, in its discretion, make a Matching Contribution to the Plan
for each Contribution Period in an amount up to the following percentage of the
"eligible Tax-Deferred Contributions" for the Contribution Period made on behalf
of its Employees during the Contribution Period who are eligible to participate
in the allocation of Matching Contributions for the Contribution Period as
determined under this Article, based on the number of years of Vesting Service
as of January 4 of the Contribution Period.

Years of Vesting Service                             Contribution Percentage
------------------------                             -----------------------

      less than 3                                               50%
      3 or more                                                100%

In addition, each Employer may increase proportionately the Matching
Contribution percentages described above for the Contribution Period by an
amount, determined by the Sponsor, in its discretion. For purposes of this
Article, "eligible Tax-Deferred Contributions" with respect to an Employee mean
the Tax-Deferred Contributions made on his behalf for the Contribution Period in
an amount up to, but not exceeding, the "match level." For purposes of this
Article, the "match level" means 6 percent of an Employee's Compensation for the
Contribution Period.

6.5  Allocation of Matching Contributions

Any Matching Contribution made by an Employer for the Contribution Period shall
be allocated among its Employees during the Contribution Period who are eligible
to participate in the allocation of Matching Contributions for the Contribution
Period, as determined under this Article. The allocable share of each such
Employee shall be an amount up to the percentage of the "eligible Tax-Deferred
Contributions" made on his behalf for the Contribution Period determined as
provided in the preceding Section. Notwithstanding the foregoing, if any
Matching Contribution made by an Employee for the Contribution Period is less
than the maximum contribution amount provided, the contribution shall be
allocated among all Employees who are

                                       19
<PAGE>   20

eligible to participate in the allocation in the same ratio that the Matching
Contribution would have been allocated among the Employees if the Matching
Contribution were the maximum contribution, provided hereunder. If an Employer
makes a greater Matching Contribution for the Contribution Period, the allocable
share of each such Employee in such Matching Contribution shall be the amount
determined by the Sponsor.

6.6  Verification of Amount of Employer Contributions by the Sponsor

The Sponsor shall verify the amount of Employer Contributions to be made by each
Employer in accordance with the provisions of the Plan. Notwithstanding any
other provision of the Plan to the contrary, the Sponsor shall determine the
portion of the Employer Contribution to be made by each Employer with respect to
an Employee who transfers from employment with one Employer as an Employee to
employment with another Employer as an Employee.

6.7  Payment of Employer Contributions

Employer Contributions made for a Contribution Period shall be paid in cash to
the Trustee within the period of time required under the Code in order for the
contribution to be deductible by the Employer in determining its Federal income
taxes for the Plan Year.

6.8  Eligibility to Participate in Allocation

Each Employee shall be eligible to participate in the allocation of Employer
Contributions beginning on the date he becomes, or again becomes, an Eligible
Employee in accordance with the provisions of Article III. Notwithstanding the
foregoing, (a) no person shall be eligible to participate in the allocation of
Profit Sharing Contributions for a Contribution Period unless (i) he is employed
by an Employer or a Related Company on the last day of the Contribution Period
and (ii) he has completed at least 500 Hours of Service during the Contribution
Period and (b) no person shall be eligible to participate in the allocation of
Matching Contributions for a Contribution Period unless he is employed by an
Employer or a Related Company on the last day of the Contribution Period;
provided, however, that if the Plan would not otherwise meet the minimum
coverage requirements of Section 410(b) of the Code in any Plan Year, the group
of Employees eligible to participate in the allocation of Profit Sharing
Contributions shall be expanded to include the minimum number of Employees who
would be eligible to participate except for their failure to complete the
required number of Hours of Service during the Plan Year that is necessary to
meet the minimum coverage requirements. The Employees who become eligible to
participate under the provisions of the immediately preceding clause shall be
those employees who have completed the greatest number of Hours of Service
during the Plan Year. If the Plan still would not meet the minimum coverage
requirements of Section 410(b) of the Code, the group of Employees eligible to
participate in the allocation of Employer Contributions shall be expanded to
include the minimum number of Employees who are not employed by an Employer or a
Related Company on the last day of the Contribution Period that is necessary to
meet the minimum coverage requirements. The Employees who become eligible to
participate under the provisions of the immediately preceding clause shall be
those Employees who have completed the greatest number of Hours of Service
during the Contribution Period.

6.9  Vesting of Employer Contributions

A Participant's vested interest in his Profit Sharing Contributions Sub-Account
shall be at all times 100 percent. A Participant's vested interest in that
portion of his Matching Contributions Sub-Account attributable to Matching
Contributions allocated to such account prior to January 1,

                                       20
<PAGE>   21

1996 shall be 100 percent. A Participant's vested interest in that portion of
his Matching Contributions Sub-Account attributable to Matching Contributions
allocated to such account on or after January 1, 1996 shall be determined in
accordance with the following schedule:

       Years of Vesting Service                    Vested Interest
       ------------------------                    ---------------

           Less than 1                                     0%
           1 but less than 2                              20%
           2 but less than 3                              50%
           3 or more                                     100%

Notwithstanding the foregoing, if a Participant is employed by an Employer or a
Related Company on his Normal Retirement Date, the date he attains age 55, the
date he becomes physically or mentally disabled such that he can no longer
continue in the service of his Employer and is eligible to receive a benefit
under his Employer's long term disability plan, or the date he dies, his vested
interest in his Matching Contributions Sub-Account shall be 100 percent.

6.10 Election of Former Vesting Schedule

If the Sponsor adopts an amendment to the Plan that directly or indirectly
affects the computation of a Participant's vested interest in his Employer
Contributions Sub-Account, any Participant with three or more years of Vesting
Service shall have a right to have his vested interest in his Employer
Contributions Sub-Account continue to be determined under the vesting provisions
in effect prior to the amendment rather than under the new vesting provisions,
unless the vested interest of the Participant in his Employer Contributions
Sub-Account under the Plan as amended is not at any time less than such vested
interest determined without regard to the amendment. A Participant shall
exercise his right under this Section by giving written notice of his exercise
thereof to the Administrator within 60 days after the latest of (i) the date he
receives notice of the amendment from the Administrator, (ii) the effective date
of the amendment, or (iii) the date the amendment is adopted. Notwithstanding
the foregoing, a Participant's vested interest in his Employer Contributions
Sub-Account on the effective date of such an amendment shall not be less than
his vested interest in his Employer Contributions Sub-Account immediately prior
to the effective date of the amendment.

6.11 Forfeitures to Reduce Employer Contributions

Notwithstanding any other provision of the Plan to the contrary, the amount of
the Employer Contribution required under this Article for a Plan Year shall be
reduced by the amount of any forfeitures occurring during the Plan Year that are
not used to pay Plan expenses.

                                       21
<PAGE>   22

                                   ARTICLE VII
                          LIMITATIONS ON CONTRIBUTIONS

7.1  Definitions

For purposes of this Article, the following terms have the following meanings :

(a)  The "actual deferral percentage" with respect to an Eligible Employee for a
     particular Plan Year means the ratio of the Tax-Deferred Contributions made
     on his behalf for the Plan Year to his test compensation for the Plan Year;
     provided, however, that contributions made on a Participant's behalf for a
     Plan Year shall be included in determining his actual deferral percentage
     for such Plan Year only if the contributions are made to the Plan prior to
     the end of the 12-month period immediately following the Plan Year to which
     the contributions relate. The determination and treatment of the actual
     deferral percentage amounts for any Participant shall satisfy such other
     requirements as may be prescribed by the Secretary of the Treasury.

(b)  The "aggregate limit" means the sum of (i) 125 percent of the greater of
     the average contribution percentage for eligible participants other than
     Highly Compensated Employees or the average actual deferral percentage for
     Eligible Employees other than highly Compensated Employees and (ii) the
     lesser of 200 percent or two plus the lesser of such average contribution
     percentage or average actual deferral percentage, or, if it would result in
     a larger aggregate limit, the sum of (iii) 125 percent of the lesser of the
     average contribution percentage for eligible participants other than Highly
     Compensated Employees or the average actual deferral percentage for
     Eligible Employees other than Highly Compensated Employees and (iv) the
     lesser of 200 percent or two plus the greater of such average contribution
     percentage or average actual deferral percentage.

(c)  The "annual addition" with respect to a Participant for a limitation year
     means the sum of the Tax-Deferred Contributions and Employer Contributions
     allocated to his Separate Account for the limitation year (including any
     excess contributions that are distributed pursuant to this Article), the
     employer contributions, employee contributions, and forfeitures allocated
     to his accounts for the limitation year under any other qualified defined
     contribution plan (whether or not terminated) maintained by an Employer or
     a Related Company concurrently with the Plan, and amounts described in
     Sections 415 (1) (2) and 419A (d) (2) of the Code allocated to his account
     for the limitation year.

(d)  The "Code Section 402 (g) limit" means the dollar limit imposed by Section
     402 (g) (1) of the Code or established by the Secretary of the Treasury
     pursuant to Section 402 (g) (5) of the Code in effect on January 1 of the
     calendar year in which an Eligible Employee's taxable year begins.

(e)  The "contribution percentage" with respect to an eligible participant for a
     particular Plan Year means the ratio of the matching contributions made to
     the Plan on his behalf for the Plan Year to his test compensation for such
     Plan Year, except that, to the extent permitted by regulations issued under
     Section 401 (m) of the Code, the Sponsor may elect to take into account in
     computing the numerator of each eligible participant's contribution
     percentage the Tax-Deferred Contributions made to the Plan on his behalf
     for the Plan Year; provided, however, that any Tax-Deferred Contributions
     that were taken into account in computing the numerator of an eligible
     participant's actual deferral percentage may not be taken into account in
     computing the numerator of his contribution percentage;

                                       22
<PAGE>   23

     and provided, further, that contributions made by or on a Participant's
     behalf for a Plan Year shall be included in determining his contribution
     percentage for such Plan Year only if the contributions are made to the
     Plan prior to the end of the 12-month period immediately following the Plan
     Year to which the contributions relate. The determination and treatment of
     the contribution percentage amounts for any Participant shall satisfy such
     other requirements as may be prescribed by the Secretary of the Treasury.

(f)  An "elective contribution" means any employer contribution made to a plan
     maintained by an Employer or any Related Company on behalf of a Participant
     in lieu of cash compensation pursuant to his written election to defer
     under any qualified CODA as described in Section 401(k) of the Code, any
     simplified employee pension cash or deferred arrangement as described in
     Section 402(h) (1) (B) of the Code, any eligible deferred compensation plan
     under Section 457 of the Code, or any plan as described in Section 501(c)
     (18) of the Code, and any contribution made on behalf of the Participant by
     an Employer or a Related Company for the purchase of an annuity contract
     under Section 403(b) of the Code pursuant to a salary reduction agreement.

(g)  An "eligible participant" means any Employee who is eligible to have
     Tax-Deferred Contributions made on his behalf (if Tax-Deferred
     Contributions are taken into account in computing contribution percentages)
     or to participate in the allocation of matching contributions.

(h)  An "excess deferral" with respect to a Participant means that portion of a
     Participant's Tax-Deferred Contributions that when added to amounts
     deferred under other plans or arrangements described in Sections 401(k),
     408(k), or 403(b) of the Code, would exceed the Code Section 402(g) limit
     and is includable in the Participant's gross income under Section 402(g) of
     the Code.

(i)  A "family member" of an Employee means the Employee's spouse, his lineal
     ascendants, his lineal descendants, and the spouses of such lineal
     ascendants and descendants.

(j)  A "limitation year" means the calendar year.

(k)  A "matching contribution" means any employer contribution allocated to an
     Eligible Employee's account under the Plan or any other plan of an Employer
     or a Related Company solely on account of elective contributions made on
     his behalf or employee contributions made by him.

(l)  The "test compensation" of an Eligible Employee for a Plan Year means
     compensation as defined in Section 414(s) of the Code and regulations
     issued thereunder, limited, however, to (1) $200,000 for Plan Years
     beginning prior to January 1, 1994, or (2) $150,000 for Plan Years
     beginning on or after January 1, 1994 (subject to adjustment annually as
     provided in Section 401(a) (17) (B) and Section 415(d) of the Code;
     provided, however, that the dollar increase in effect on January 1 of any
     calendar year, if any, is effective for Plan Years beginning in such
     calendar year). If the test compensation of a Participant is determined
     over a period of time that contains fewer than 12 calendar months, then the
     annual compensation limitation described above shall be adjusted with
     respect to that Participant by multiplying the annual compensation
     limitation in effect for the Plan Year by a fraction the numerator of which
     is the number

                                       23
<PAGE>   24

     of full months in the period and the denominator of which is 12; provided,
     however, that no proration is required for a Participant who is covered
     under the Plan for less than one full Plan Year if the formula for
     allocations is based on Compensation for a period of at least 12 months. In
     determining the test compensation, for purposes of applying the annual
     limitation described above, of a Participant who is a five-percent owner or
     among the ten Highly Compensated Employees receiving the greatest test
     compensation for the limitation year, the test compensation of the
     Participant's spouse and of his lineal descendants who have not attained
     age 19 as of the close of the limitation year shall be included as test
     compensation of the Participant for the limitation year. If as a result of
     applying the family aggregation rule described in the preceding sentence
     the annual compensation limitation would be exceeded, the limitation shall
     be prorated among the affected family members in proportion to each
     member's test compensation as determined prior to application of the family
     aggregation rules.

7.2  Code Section 402(g) Limit

In no event shall the amount of the Tax-Deferred Contributions made on behalf of
an Eligible Employee for his taxable year, when aggregated with any elective
contributions made on behalf of the Eligible Employee under any other plan of an
Employer or a Related Company for his taxable year, exceed the Code Section
402(g) limit. In the event that the Administrator determines that the reduction
percentage elected by an Eligible Employee will result in his exceeding the Code
Section 402(g) limit, the Administrator may adjust the reduction authorization
of such Eligible Employee by reducing the percentage of his Tax-Deferred
Contributions to such smaller percentage that will result in the Code Section
402(g) limit not being exceeded. If the Administrator determines that the
Tax-Deferred Contributions made on behalf of an Eligible Employee would exceed
the Code Section 402(g) limit for his taxable year, the Tax-Deferred
Contributions for such Participant shall be automatically suspended for the
remainder, if any, of such taxable year.

If an Employer notifies the Administrator that the Code Section 402(g) limit has
nevertheless been exceeded by an Eligible Employee for his taxable year, the
Tax-Deferred Contributions that, when aggregated with elective contributions
made on behalf of the Eligible Employee under any other plan of an Employer or a
Related Company, would exceed the Code Section 402(g) limit, plus any income and
minus any losses attributable thereto, shall be distributed to the Eligible
Employee no later than the April 15 immediately following such taxable year. Any
Tax-Deferred Contributions that are distributed to an Eligible Employee in
accordance with this Section shall NOT be taken into account in computing the
Eligible Employee's actual deferral percentage for the Plan Year in which the
Tax-Deferred Contributions were made, unless the Eligible Employee is a Highly
Compensated Employee. If an amount of Tax-Deferred Contributions is distributed
to a Participant in accordance with this Section, matching contributions that
are attributable solely to the distributed Tax-Deferred Contributions, plus any
income and minus any losses attributable thereto, shall be forfeited by the
Participant. Any such forfeited amounts shall be treated as a forfeiture under
the Plan in accordance with the provisions of Article XIV as of the last day of
the month in which the distribution of Tax-Deferred Contributions pursuant to
this Section occurs.

7.3  Distribution of Excess Deferrals

Notwithstanding any other provision of the Plan to the contrary, if a
Participant notifies the Administrator in writing no later than the March 1
following the close of the Participant's taxable year that excess deferrals have
been made on his behalf under the Plan for such taxable year, the excess
deferrals, plus any income and minus any losses attributable thereto, shall be
distributed to

                                       24
<PAGE>   25

the Participant no later than the April 15 immediately following such taxable
year. Any Tax-Deferred Contributions that are distributed to a Participant in
accordance with this Section shall nevertheless be taken into account in
computing the Participant's actual deferral percentage for the Plan Year in
which the Tax-Deferred Contributions were made. If an amount of Tax-Deferred
Contributions is distributed to a Participant in accordance with this Section,
matching contributions that are attributable solely to the distributed
Tax-Deferred Contributions, plus any income and minus any losses attributable
thereto, shall be forfeited by the Participant. Any such forfeited amounts shall
be treated as a forfeiture under the Plan in accordance with the provisions of
Article XIV as of the last day of the month in which the distribution of
Tax-Deferred Contributions pursuant to this Section occurs.

7.4  Limitation on Tax-Deferred Contributions of Highly Compensated Employees

Notwithstanding any other provision of the Plan to the contrary, the
Tax-Deferred Contributions made with respect to a Plan Year on behalf of
Eligible Employees who are Highly Compensated Employees may not result in an
average actual deferral percentage for such Eligible Employees that exceeds the
greater of:

(a)  a percentage that is equal to 125 percent of the average actual deferral
     percentage for all other Eligible Employees; or

(b)  a percentage that is not more than 200 percent of the average actual
     deferral percentage for all other Eligible Employees and that is not more
     than two percentage points higher than the average actual deferral
     percentage for all other Eligible Employees.

In order to assure that the limitation contained herein is not exceeded with
respect to a Plan Year, the Administrator is authorized to suspend completely
further Tax-Deferred Contributions on behalf of Highly Compensated Employees for
any remaining portion of a Plan Year or to adjust the projected actual deferral
percentages of Highly Compensated Employees by reducing their percentage
elections with respect to Tax-Deferred Contributions for any remaining portion
of a Plan Year to such smaller percentages that will result in the limitation
set forth above not being exceeded. In the event of any such suspension or
reduction, Highly Compensated Employees affected thereby shall be notified of
the reduction or suspension as soon as possible and shall be given an
opportunity to make a new Tax-Deferred Contribution election to be effective the
first day of the next following Plan Year. In the absence of such an election,
the election in effect immediately prior to the suspension or adjustment
described above shall be reinstated as of the first day of the next following
Plan Year.

For purposes of applying the limitation contained in this Section, the
Tax-Deferred Contributions and test compensation of any Eligible Employee who is
a family member of another Eligible Employee who is a five percent owner or
among the ten Highly Compensated Employees receiving the greatest test
compensation for the Plan Year shall be aggregated with the Tax-Deferred
Contributions and test compensation of such other Eligible Employee, and such
family member shall not be considered an Eligible Employee for purposes of
determining the average actual deferral percentage for all other Eligible
Employees.

In determining the actual deferral percentage for any Eligible Employee who is a
Highly Compensated Employee for the Plan Year, elective contributions made to
his accounts under any other plan of an Employer or a Related Company shall be
treated as if all such contributions were made to the Plan; provided, however,
that if such a plan has a plan year different from the Plan Year, any such
contributions made to the Highly Compensated Employee's accounts under the

                                       25
<PAGE>   26

plan for the plan year ending with or within the same calendar year as the Plan
Year shall be treated as if such contributions were made to the Plan.
Notwithstanding the foregoing, such contributions shall not be treated as if
they were made to the Plan if regulations issued under Section 401(k) of the
Code do not permit such plan to be aggregated with the Plan.

If one or more plans of an Employer or Related Company are aggregated with the
Plan for purposes of satisfying the requirements of Section 401(a) (4) or 410(b)
of the Code, then actual deferral percentages under the Plan shall be calculated
as if the Plan and such one or more other plans were a single plan. For Plan
Years beginning after December 31, 1991, plans may be aggregated to satisfy
Section 401(k) of the Code only if they have the same plan year.

The Administrator shall maintain records sufficient to show that the limitation
contained in this Section was not exceeded with respect to any Plan Year.

7.5  Distribution of Excess Tax-Deferred Contributions

Notwithstanding any other provision of the Plan to the contrary, in the event
that the limitation contained in Section 7.4 is exceeded in any Plan Year, the
Tax-Deferred Contributions made with respect to a Highly Compensated Employee
that exceed the maximum amount permitted to be contributed to the Plan on his
behalf under Section 7.4, plus any income and minus any losses attributable
thereto, shall be distributed to the Highly Compensated Employee prior to the
end of the next succeeding Plan Year. If excess amounts are attributable to
Participants aggregated under the family aggregation rules described in Section
7.4, the excess shall be allocated among family members in proportion to the
Tax-Deferred Contributions made with respect to each family member. If such
excess amounts are distributed more than 2 1/2 months after the last day of the
Plan Year for which the excess occurred, an excise tax may be imposed under
Section 4979 of the Code on the Employer maintaining the Plan with respect to
such amounts.

The maximum amount permitted to be contributed to the Plan on a Highly
Compensated Employee's behalf under Section 7.4 shall be determined by reducing
Tax-Deferred Contributions made on behalf of Highly Compensated Employees in
order of their actual deferral percentages beginning with the highest of such
percentages. The determination of the amount of excess Tax-Deferred
Contributions shall be made after application of Section 7.3, if applicable.

If an amount of Tax-Deferred Contributions is distributed to a Participant in
accordance with this Section, matching contributions that are attributable
solely to the distributed Tax-Deferred Contributions, plus any income and minus
any losses attributable thereto, shall be forfeited by the Participant. Any such
forfeited amounts shall be treated as a forfeiture under the Plan in accordance
with the provisions of Article XIV as of the last day of the month in which the
distribution of Tax-Deferred Contributions pursuant to this Section occurs.

7.6  Limitation on Matching Contributions of Highly Compensated Employees

Notwithstanding any other provision of the Plan to the contrary, the matching
contributions made with respect to a Plan Year on behalf of eligible
participants who are Highly Compensated Employees may not result in an average
contribution percentage for such eligible participants that exceeds the greater
of:

(a)  a percentage that is equal to 125 percent of the average contribution
     percentage for all other eligible participants; or

                                       26
<PAGE>   27

(b)  a percentage that is not more than 200 percent of the average contribution
     percentage for all other eligible participants and that is not more than
     two percentage points higher than the average contribution percentage for
     all other eligible participants.

For purposes of applying the limitation contained in this Section, the matching
contributions, Tax-Deferred Contributions (to the extent that such Tax-Deferred
Contributions are taken into account in computing contribution percentages), and
test compensation of any eligible participant who is a family member of another
eligible participant who is a five percent owner or among the ten Highly
Compensated Employees receiving the greatest test compensation for the Plan Year
shall be aggregated with the matching contributions, Tax-Deferred Contributions,
and test compensation of such other eligible participant, and such family member
shall not be considered an eligible participant for purposes of determining the
average contribution percentage for all other eligible participants.

In determining the contribution percentage for any eligible participant who is a
Highly Compensated Employee for the Plan Year, matching contributions, employee
contributions, and elective contributions (to the extent that elective
contributions are taken into account in computing contribution percentages) made
to his accounts under any other plan of an Employer or a Related Company shall
be treated as if all such contributions were made to the Plan; provided,
however, that if such a plan has a plan year different from the Plan Year, any
such contributions made to the Highly Compensated Employee's accounts under the
plan for the plan year ending with or within the same calendar year as the Plan
Year shall be treated as if such contributions were made to the Plan.
Notwithstanding the foregoing, such contributions shall not be treated as if
they were made to the Plan if regulations issued under Section 401(m) of the
Code do not permit such plan to be aggregated with the Plan.

If one or more plans of an Employer or a Related Company are aggregated with the
Plan for purposes of satisfying the requirements of Section 401(a) (4) or 410
(b) of the Code, the contribution percentages under the Plan shall be calculated
as if the Plan and such one or more other plans were a single plan. Plans may be
aggregated to satisfy Section 401(m) of the Code only if they have the same plan
year.

The Administrator shall maintain records sufficient to show that the limitation
contained in this Section was not exceeded with respect to any Plan Year and the
amount of the elective contributions taken into account in computing
contribution percentage for any Plan Year.

7.7  Forfeiture or Distribution of Excess Contributions

Notwithstanding any other provision of the Plan to the contrary, in the event
that the limitation contained in Section 7.6 is exceeded in any Plan Year, the
matching contributions made on behalf of a Highly Compensated Employee that
exceed the maximum amount permitted to be contributed to the Plan on behalf of
such Highly Compensated Employee under Section 7.6, plus any income and minus
any losses attributable thereto, shall be forfeited, to the extent forfeitable,
or distributed to the Participant prior to the end of the next succeeding Plan
Year as hereinafter provided. If excess amounts are attributable to Participants
aggregated under the family aggregation rules described in Section 7.5, the
excess shall be allocated among family members in proportion to the matching
contributions made with respect to each family member. If such excess amounts
are distributed more than 2 1/2 months after the last day of the Plan Year for
which the excess occurred, an excise tax may be imposed under Section 4979 of
the Code on the Employer maintaining the Plan with respect to such amounts.

                                       27
<PAGE>   28

The maximum amount permitted to be contributed to the Plan on behalf of a Highly
Compensated Employee under Section 7.6 shall be determined by reducing matching
contributions made on behalf of Highly Compensated Employees in order of their
contribution percentages beginning with the highest of such percentages.

Any amounts forfeited with respect to a Participant pursuant to this Section
shall be treated as a forfeiture under the Plan in accordance with the
provisions of Article XIV as of the last day of the month in which the
distribution of contributions pursuant to this Section occurs. Excess matching
contributions shall be distributable to the extent the Participant has a vested
interest in his Employer Contributions Sub-Account that is attributable to
matching contributions and shall otherwise be forfeitable. The determination of
the amount of excess matching contributions shall be made after application of
Section 7.3, if applicable, and after application of Section 7.5, if applicable.

7.8  Multiple Use Limitation

Notwithstanding any other provision of the Plan to the contrary, the following
multiple use limitation as required under Section 401(m) of the Code shall
apply: the sum of the average actual deferral percentage for Eligible Employees
who are Highly Compensated Employees and the average contribution percentage for
eligible participants who are Highly Compensated Employees may not exceed the
aggregate limit. In the event that, after satisfaction of Section 7.5 and
Section 7.7, it is determined that contributions under the Plan fail to satisfy
the multiple use limitation contained herein, the multiple use limitation shall
be satisfied by further reducing the actual deferral percentages of Eligible
Employees who are Highly Compensated Employees (beginning with the highest such
percentage) to the extent necessary to eliminate the excess, with such further
reductions to be treated as excess Tax-Deferred Contributions and disposed of as
provided in Section 7.5, or in an alternative manner, consistently applied, that
may be permitted by regulations issued under Section 401(m) of the Code.

7.9  Determination of Income or Loss

The income or loss attributable to excess contributions that are distributed
pursuant to this Article shall be determined for the preceding Plan Year under
the method otherwise used for allocating income or loss to Participant's
Separate Accounts.

7.10 Code Section 415 Limitations on Crediting of Contributions and Forfeitures

Notwithstanding any other provision of the Plan to the contrary, the annual
addition with respect to a Participant for a limitation year shall in no event
exceed the lesser of (i) $30,000 (adjusted as provided in Section 415(d) of the
Code, with the first adjustment being made for limitation years beginning on or
after January 1, 1996) or (ii) 25 percent of the Participant's compensation, as
defined in Section 415 (c) (3) of the Code and regulations issued thereunder,
for the limitation year. If the annual addition to the Separate Account of a
Participant in any limitation year would otherwise exceed the amount that may be
applied for his benefit under the limitation contained in this Section, the
limitation shall be satisfied by reducing contributions made on behalf of the
Participant to the extent necessary in the following order:

     Tax-Deferred Contributions made on the Participant's behalf for the
     limitation year and the matching contributions attributable thereto, if
     any, shall be reduced pro rata.

                                       28
<PAGE>   29

The amount of any reduction of Tax-Deferred Contributions (plus any income
attributable thereto) shall be returned to the Participant. The amount of any
reduction of Employer Contributions shall be deemed a forfeiture for the
limitation year. Amounts deemed to be forfeitures under this Section shall be
held unallocated in a suspense account established for the limitation year and
shall be applied against the Employer's contribution obligation for the next
following limitation year (and succeeding limitation years, as necessary). If a
suspense account is in existence at any time during a limitation year, all
amounts in the suspense account must be allocated to Participants' Separate
Accounts (subject to the limitations contained herein) before any further
Tax-Deferred Contributions or Employer Contributions may be made to the Plan on
behalf of Participants. No suspense account established hereunder shall share in
any increase or decrease in the net worth of the Trust. For purposes of this
Article, excesses shall result only from the allocation of forfeitures, a
reasonable error in estimating a Participant's annual compensation (as defined
in Section 415 (c) (3) of the Code and regulations issued thereunder), a
reasonable error in determining the amount of Tax-Deferred Contributions that
may be made with respect to any Participant under the limits of Section 415 of
the Code, or other limited facts and circumstances that justify the availability
of the provisions set forth above.

7.11 Coverage Under Other Qualified Defined Contribution Plan

If a Participant is covered by any other qualified defined contribution plan
(whether or not terminated) maintained by an Employer or a Related Company
concurrently with the Plan, and if the annual addition for the limitation year
would otherwise exceed the amount that may be applied for the Participant's
benefit under the limitation contained in Section 7.10, such excess shall be
reduced first by returning the employee contributions made by the Participant
for the limitation year under all of the defined contribution plans other than
the Plan and the income attributable thereto to the extent necessary. If the
limitation contained in Section 7.10 is still not satisfied after returning all
of the employee contributions made by the Participant under all such other
plans, the excess shall be reduced by returning the elective contributions made
on the Participant's behalf for the limitation year under all such other plans
and the income attributable thereto to the extent necessary on a pro rata basis
among all of such plans. If the limitation contained in Section 7.10 is still
not satisfied after returning all of the elective contributions made on the
Participant's behalf under all such other plans, the procedure set forth in
Section 7.10 shall be invoked to eliminate any such excess. If the limitation
contained in Section 7.10 is still not satisfied after invocation of the
procedure set forth in Section 7.10, the portion of the employer contributions
and of forfeitures for the limitation year under all such other plans that has
been allocated to the Participant thereunder, but which exceeds the limitation
set forth in Section 7.10, shall be deemed a forfeiture for the limitation year
and shall be disposed of as provided in such other plans; provided, however,
that if the Participant is covered by a money purchase pension plan, the
forfeiture shall be effected first under any other defined contribution plan
that is not a money purchase pension plan and, if the limitation is still not
satisfied, then under such money purchase pension plan.

                                       29
<PAGE>   30

7.12 Coverage Under Qualified Defined Benefit Plan

If a Participant in the Plan is also covered by a qualified defined benefit plan
(whether or not terminated) maintained by an Employer or a Related Company, in
no event shall the sum of the defined benefit plan fraction (as defined in
Section 415(e) (2) of the Code) and the defined contribution plan fraction (as
defined in Section 415(e) (3) of the Code) exceed 1.0 in any limitation year.
If, before October 3, 1973, the Participant was an active participant in a
qualified defined benefit plan maintained by an Employer or a Related Company
and otherwise satisfies the requirements of Section 2004(d) (2) of ERISA, then
for purposes of applying this Section, the defined benefit plan fraction shall
not exceed 1.0. In the event the special limitation contained in this Section is
exceeded, the benefits otherwise payable to the Participant under any such
qualified defined benefit plan shall be reduced to the extent necessary to meet
such limitation.

7.13 Scope of Limitations

The limitations contained in Section 7.10, 7.11, and 7.12 shall be applicable
only with respect to benefits provided pursuant to defined contribution plans
and defined benefit plans described in Section 415(k) of the Code.

                                       30
<PAGE>   31

                                  ARTICLE VIII
                        TRUST FUNDS AND SEPARATE ACCOUNTS

8.1  General Fund

The Trustee shall maintain a General Fund as required to hold and administer any
assets of the Trust that are not allocated among the Investment Funds as
provided in the Plan or the Trust Agreement. The General Fund shall be held and
administered as a separate common trust fund. The interest of each Participant
or Beneficiary under the Plan in the General Fund shall be an undivided
interest.

8.2  Investment Funds

The Sponsor shall determine the number and type of Investment Funds and select
the investments for such Investment Funds. The Sponsor shall communicate the
same and any changes therein in writing to the Administrator and the Trustee.
Each Investment Fund shall be held and administered as a separate pool. The
interest of each participant or Beneficiary under the Plan in any Investment
Fund shall be an undivided interest.

8.3  Loan Investment Fund

If a loan from the Plan to a Participant is approved in accordance with the
provisions of Article XII, the Sponsor shall direct the establishment and
maintenance of a loan Investment Fund in the Participant's name. The assets of
the loan Investment Fund shall be held as a separate trust fund. A Participant's
loan Investment Fund shall be invested in the note reflecting the loan that is
executed by the Participant in accordance with the provisions of Article XII.
Notwithstanding any other provision of the Plan to the contrary, income received
with respect to a Participant's loan Investment Fund shall be allocated and the
loan Investment Fund shall be administered as provided in Article XII.

8.4  Income on Trust

Any dividends, interest, distributions, or other income received by the Trustee
with respect to any Trust Fund maintained hereunder shall be allocated by the
Trustee to the Trust Fund for which the income was received.

8.5  Separate Accounts

As of the first date a contribution is made by or on behalf of an Employee,
there shall be established a Separate Account in his name reflecting his
interest in the Trust. Each Separate Account shall be maintained and
administered for each Participant and Beneficiary in accordance with the
provisions of the Plan. The balance of each Separate Account shall be the
balance of the account after all credits and charges thereto, for and as of such
date, have been made as provided herein.

                                       31
<PAGE>   32

8.6  Sub-Accounts

A Participant's Separate Account shall be divided into individual Sub-Accounts
reflecting the portion of the Participant's Separate Account that is derived
from Tax-Deferred Contributions, Rollover Contributions, or Employer
Contributions. Each Sub-Account shall reflect separately contributions allocated
to each Trust Fund maintained hereunder and the earnings and losses attributable
thereto. Such other Sub-Accounts may be established as are necessary or
appropriate to reflect a Participant's interest in the Trust.



                                       32
<PAGE>   33

                                   ARTICLE IX
                            LIFE INSURANCE CONTRACTS

9.1  No Life Insurance Contracts

There shall be no life insurance contracts purchased under the Plan.



                                       33
<PAGE>   34

                                    ARTICLE X
                     DEPOSIT AND INVESTMENT OF CONTRIBUTIONS

10.1 Future Contribution Investment Elections

Each Eligible Employee shall make an investment election in the manner and form
prescribed by the Administrator directing the manner in which his Tax-Deferred
Contributions, Rollover Contributions, and Employer Contributions shall be
invested. An Eligible Employee's investment election shall specify the
percentage, in the percentage increments prescribed by the Administrator, of
such contributions that shall be allocated to one or more of the Investment
Funds with the sum of such percentages equaling 100 percent. The investment
election by a Participant shall remain in effect until his entire interest under
the Plan is distributed or forfeited in accordance with the provisions of the
Plan or until he files a change of investment election with the Administrator,
in such form as the Administrator shall prescribe. A Participant's change of
investment election may be made effective as of the date or dates prescribed by
the Administrator.

10.2 Deposit of Contributions

All Tax-Deferred Contributions, Rollover Contributions, and Employer
Contributions shall be deposited in the trust and allocated among the Investment
Funds in accordance with the Participant's currently effective investment
election. If no investment election is on file with the Administrator at the
time contributions are to be deposited to a Participant's Separate Account, the
Participant shall be notified and an investment election form shall be provided
to him. Until such Participant shall make an effective election under this
Section, his contributions shall be allocated among the Investment Funds as
directed by the Administrator.

10.3 Election to Transfer Between Funds

A participant may elect to transfer investments from any Investment Fund to any
other Investment Fund. The Participant's transfer election shall specify either
(i) a percentage, in the percentage increments prescribed by the Administrator,
of the amount eligible for transfer, which percentage may not exceed 100
percent, or (ii) a dollar amount that is to be transferred. Subject to any
restrictions pertaining to a particular Investment Fund, a Participant's
transfer election may be made effective as of the date or dates prescribed by
the Administrator.


                                       34
<PAGE>   35

                                   ARTICLE XI
                     CREDITING AND VALUING SEPARATE ACCOUNTS

11.1 Crediting Separate Accounts

All contributions made under the provisions of the Plan shall be credited to
Separate Accounts in the Trust Funds by the Trustee, in accordance with
procedures established in writing by the Administrator, either when received or
on the succeeding Valuation Date after valuation of the Trust Fund has been
completed for such Valuation Date as provided in Section 11.2, as shall be
determined by the Administrator.

11.2 Valuing Separate Accounts

Separate Accounts in the Trust Funds shall be valued by the Trustee on the
Valuation Date, in accordance with procedures established in writing by the
Administrator, either in the manner adopted by the Trustee and approved by the
Administrator or in the manner set forth in Section 11.3 as Plan valuation
procedures, as determined by the Administrator.

11.3 Plan Valuation Procedures

With respect to the Trust Funds, the Administrator may determine that the
following valuation procedures shall be applied. As of each Valuation Date
hereunder, the portion of any Separate Accounts in a Trust Fund shall be
adjusted to reflect any increase or decrease in the value of the Trust Fund for
the period of time occurring since the immediately preceding Valuation Date for
the Trust Fund (the "valuation period") in the following manner:

(a)  First, the value of the Trust Fund shall be determined by valuing all of
     the assets of the Trust Fund at fair market value.

(b)  Next, the net increase or decrease in the value of the Trust Fund
     attributable to net income and all profits and losses, realized and
     unrealized, during the valuation period shall be determined on the basis of
     the valuation under paragraph (a) taking into account appropriate
     adjustments for contributions, loan payments, and transfers to and
     distributions, withdrawals, loans, and transfers from such Trust Fund
     during the valuation period.

(c)  Finally, the net increase or decrease in the value of the Trust Fund shall
     be allocated among Separate Accounts in the Trust Fund in the ratio of the
     balance of the portion of such Separate Account in the Trust Fund as of the
     preceding Valuation Date less any distributions, withdrawals, loans, and
     transfers from such Separate Account balance in the Trust Fund since the
     Valuation Date to the aggregate balances of the portions of all Separate
     Accounts in the Trust Fund similarly adjusted, and each Separate Account in
     the Trust Fund shall be credited or charged with the amount of its
     allocated share. Notwithstanding the foregoing, the Administrator may adopt
     such accounting procedures as it considers appropriate and equitable to
     establish a proportionate crediting of net increase or decrease in the
     value of the Trust Fund for contributions, loan payments, and transfers to
     and distributions, withdrawals, loans, and transfer from such Trust Fund
     made by or on behalf of a Participant during the valuation period.

                                       35
<PAGE>   36

11.4 Finality of Determinations

The Trustee shall have exclusive responsibility for determining the balance of
each Separate Account maintained hereunder. The Trustee's determinations thereof
shall be conclusive upon all interested parties.

11.5 Notification

Within a reasonable period of time after the end of each Plan Year, the
Administrator shall notify each Participant and Beneficiary of the balances of
his Separate Account and Sub-Accounts as of a Valuation Date during the Plan
Year.



                                       36
<PAGE>   37

                                   ARTICLE XII
                                      LOANS

12.1 Application for Loan

A Participant who is a party in interest may make written application to the
Administrator for a loan from his Separate Account.

As collateral for any loan granted hereunder, the Participant shall grant to the
Plan a security interest in his vested interest under the Plan equal to the
amount of the loan; provided, however, that in no event may the security
interest exceed 50 percent of the Participant's vested interest under the Plan
determined as of the date as of which the loan is originated in accordance with
Plan provisions. In the case of a Participant who is an active employee, the
Participant also shall enter into an agreement to repay the loan by payroll
withholding. No loan in excess of 50 percent of the Participant's vested
interest under the Plan shall be made from the Plan. Loans shall not be made
available to Highly Compensated Employees in an amount greater than the amount
made available to other employees.

A loan shall not be granted unless the Participant consents in writing to the
charging of his Separate Account for unpaid principal and interest amounts in
the event the loan is declared to be in default.

12.2 Reduction of Account Upon Distribution

Notwithstanding any other provision of the Plan, the amount of a Participant's
Separate Account that is distributable to the Participant or his Beneficiary
under Article XIII or XV shall be reduced by the portion of his vested interest
that is held by the Plan as security for any loan outstanding to the
Participant, provided that the reduction is used to repay the loan. If
distribution is made because of the Participant's death prior to the
commencement of distribution of his Separate Account and less than 100 percent
of the Participant's vested interest in his Separate Account (determined without
regard to the preceding sentence) is payable to his surviving spouse, then the
balance of the Participant's vested interest in his Separate Account shall be
adjusted by reducing the vested account balance by the amount of the security
used to repay the loan, as provided in the preceding sentence, prior to
determining the amount of the benefit payable to the surviving spouse.

12.3 Requirements to Prevent a Taxable Distribution

Notwithstanding any other provision of the Plan to the contrary, the following
terms and conditions shall apply to any loan made to a Participant under this
Article:

(a)  The interest rate on any loan to a Participant shall be a reasonable
     interest rate commensurate with current interest rates charged for loans
     made under similar circumstances by persons in the business of lending
     money.

(b)  The amount of any loan to a Participant (when added to the outstanding
     balance of all other loans to the Participant from the Plan or any other
     plan maintained by an Employer or a Related Company) shall not exceed the
     lesser of:

                                       37
<PAGE>   38

     (i)  $50,000, reduced by the excess, if any, of the highest outstanding
          balance of any other loan to the Participant from the Plan or any
          other plan maintained by an Employer or a Related Company during the
          preceding 12-month period over the outstanding balance of such loans
          on the date a loan is made hereunder; or

     (ii) 50 percent of the vested portions of the Participant's Separate
          Account and his vested interest under all other plans maintained by an
          Employer of a Related Company.

(c)  The term of any loan to a Participant shall be no greater than five years,
     except in the case of a loan used to acquire any dwelling unit which within
     a reasonable period of time is to be used (determined at the time the loan
     is made) as a principal residence of the Participant.

(d)  Except as otherwise permitted under Treasury regulations, substantially
     level amortization shall be required over the term of the loan with
     payments made not less frequently than quarterly.

12.4 Administration of Loan Investment Fund

Upon approval of a loan to a Participant, the Administrator shall direct the
Trustee to transfer an amount equal to the loan amount from the Investment Funds
in which it is invested, as directed by the Administrator, to the loan
Investment Fund established in the Participant's name. Any loan approved by the
Administrator shall be made to the Participant out of the Participant's loan
Investment Fund. All principal and interest paid by the Participant on a loan
made under this Article shall be deposited to his Separate Account and shall be
allocated upon receipt among the Investment Funds in accordance with the
Participant's currently effective investment election. The balance of the
Participant's loan Investment Fund shall be decreased by the amount of principal
payments and the loan Investment Fund shall be terminated when the loan has been
repaid in full.

12.5 Default

If a Participant fails to make or cause to be made, any payment required under
the terms of the loan within 90 days following the date on which such payment
shall become due or there is an outstanding principal balance existing on a loan
after the last scheduled repayment date, the Administrator may direct the
Trustee to declare the loan to be in default, and the entire unpaid balance of
such loan, together with accrued interest, shall be immediately due and payable.
In any such event, if such balance and interest thereon is not then paid, the
Trustee shall charge the Separate Account of the borrower with the amount of
such balance and interest as of the earliest date a distribution may be made
from the Plan to the borrower without adversely affecting the tax qualification
of the Plan or of the cash or deferred arrangement.

12.6 Special Rules Applicable to Loans

Any loan made hereunder shall be subject to the following rules:

(a)  Loans limited to Eligible Employees: No loans shall be made to an Employee
     who makes a Rollover Contribution in accordance with Article IV, but who is
     not an Eligible Employee as provided in Article III.

                                       38
<PAGE>   39

(b)  Minimum Loan Amount: A Participant may not request a loan for less than
     $1,000.

(c)  Maximum Number of Outstanding Loans: A Participant with an outstanding loan
     may not apply for another loan until the existing loan is paid in full and
     may not refinance an existing loan or attain a second loan for the purpose
     of paying off the existing loan. A Participant may not apply for more than
     one loan during the Plan Year. The provisions of this paragraph shall not
     apply to any loans made prior to the effective date of this amendment and
     restatement; provided, however, that a Participant may not apply for a new
     loan hereunder until all outstanding loans made to the Participant prior to
     the effective date of this amendment and restatement have been paid in
     full.

(d)  Maximum Period for Real Estate Loans: The term of any loan to a Participant
     that is used to acquire any dwelling unit which within a reasonable period
     of time is to be used (determined at the time the loan is made) as a
     principal residence of the Participant shall be no greater than ten years.

(e)  Pre-Payment Without Penalty: A Participant may pre-pay the balance of any
     loan hereunder prior to the date it is due without penalty.

(f)  Effect of Termination of Employment: Upon a Participant's termination of
     employment, the balance of any outstanding loan hereunder shall immediately
     become due and owing.

12.7 Loans Granted Prior to Amendment

Notwithstanding any other provision of this Article to the contrary, any loan
made under the provisions of the Plan as in effect prior to this amendment and
restatement shall remain outstanding until repaid in accordance with its terms
or the otherwise applicable Plan provisions.


                                       39
<PAGE>   40

                                  ARTICLE XIII
                           WITHDRAWALS WHILE EMPLOYED

13.1 Withdrawals of Rollover Contributions

A Participant who is employed by an Employer or a Related Company and is
determined by the Administrator to have incurred a hardship as defined in this
Article may elect in writing, subject to the limitations and conditions
prescribed in this Article, to make a cash withdrawal or a withdrawal in the
form of a qualified joint and survivor annuity as provided in Article XVI from
his Rollover Contributions Sub-Account.

13.2 Withdrawals of Tax-Deferred Contributions

A Participant who is employed by an Employer or a Related Company and who is
determined by the Administrator to have incurred a hardship as defined in this
Article may elect in writing, subject to the limitations and conditions
prescribed in this Article, to make a cash withdrawal or a withdrawal in the
form of a qualified joint and survivor annuity as provided in Article XVI from
his Tax-Deferred Contributions Sub-Account. The maximum amount that a
Participant may withdraw pursuant to this Section because of a hardship is the
balance of his Tax-Deferred Contributions Sub-Account, exclusive of any earnings
credited to such Sub-Account.

13.3 Conditions and Limitations on Hardship Withdrawals

A Participant must file a written application for a hardship withdrawal with the
Administrator such number of days prior to the date as of which it is to be
effective as the Administrator may prescribe. Hardship withdrawals may be made
effective as soon as reasonably practicable following the Administrator's
receipt of the Participant's directions. The Administrator shall grant a
hardship withdrawal only if it determines that the withdrawal is necessary to
meet an immediate and heavy financial need of the Participant. An immediate and
heavy financial need of the Participant means a financial need on account of:

(a)  expenses previously incurred by or necessary to obtain for the Participant,
     the Participant's spouse, or any dependent of the Participant (as defined
     in Section 152 of the Code) medical care described in Section 213(d) of the
     Code;

(b)  costs directly related to the purchase (excluding mortgage payments) of a
     principal residence for the Participant;

(c)  payment of tuition, related educational fees, and room and board expenses
     for the next 12 months of post-secondary education for the Participant, the
     Participant's spouse, or any dependent of the Participant; or

(d)  the need to prevent the eviction of the Participant from his principal
     residence or foreclosure on the mortgage of the Participant's principal
     residence.

A withdrawal shall be deemed to be necessary to satisfy an immediate and heavy
financial need of a Participant only if all of the following requirements are
satisfied:

     The withdrawal is not in excess of the amount of the immediate and heavy
     financial need of the Participant.

                                       40
<PAGE>   41

     The Participant has obtained all distributions, other than hardship
     distributions, and all non-taxable loans currently available under all
     plans maintained by an Employer or any Related Company.

     The Participant's Tax-Deferred Contributions and the Participant's elective
     tax-deferred contributions and employee after-tax contributions under all
     other tax-qualified plans maintained by an Employer or any Related Company
     shall be suspended for at least twelve months after his receipt of the
     withdrawal.

     The Participant shall not make Tax-Deferred Contributions or elective
     tax-deferred contributions under any other tax-qualified plan maintained by
     an Employer or any Related Company for the Participant's taxable
     immediately following the taxable year of the withdrawal in excess of the
     applicable limit under Section 402(g) of the Code for such next taxable
     year less the amount of the Participant's Tax-Deferred Contributions and
     elective tax-deferred contributions under any other plan maintained by an
     Employer or any Related Company for the taxable year of the withdrawal.

The minimum hardship withdrawal that a Participant may make is $1,000. The
amount of hardship withdrawal may include any amounts necessary to pay any
Federal, state or local income taxes or penalties reasonably anticipated to
result from the distribution. A Participant shall not fail to be treated as an
Eligible Employee for purposes of applying the limitations contained in Article
VII of the Plan merely because his Tax-Deferred Contributions are suspended in
accordance with this Section.

13.4 Order of Withdrawal from a Participant's Sub-Accounts.

Distribution of a withdrawal amount shall be made from a Participant's
Sub-Accounts, to the extent necessary, in the order prescribed by the
Administrator, which order shall be uniform with respect to all Participants and
non-discriminatory. If the Sub-Account from which a Participant is receiving a
withdrawal is invested in more than one Investment Fund, the withdrawal shall be
charged against the Investment Funds as directed by the Administrator.

                                       41
<PAGE>   42

                                   ARTICLE XIV
                  TERMINATION OF EMPLOYMENT AND SETTLEMENT DATE

14.1 Termination of Employment and Settlement Date

A Participant's Settlement Date shall occur on the date he terminates employment
with an Employer and all Related Companies because of death, disability,
retirement, or other termination of employment. Written notice of a
Participant's Settlement Date shall be given by the Administrator to the
Trustee.

14.2 Separate Accounting for Non-Vested Amounts

If as of a Participant's Settlement Date the Participant's vested interest in
his Employer Contributions Sub-Account is less than 100 percent, that portion of
his Employer contributions Sub-Account that is not vested shall be accounted for
separately from the vested portion and shall be disposed of as provided in the
following Section.

14.3 Disposition of Non-Vested Amounts

That portion of a Participant's Employer Contributions Sub-Account that is not
vested upon the occurrence of his Settlement Date shall be disposed of as
follows:

(a)  If the Participant has no vested interest in his Separate Account upon the
     occurrence of his Settlement Date or his vested interest in his Separate
     Account as of the date of distribution does not exceed $3,500 resulting in
     the Participant's receipt of a single sum payment of such vested interest,
     the non-vested balance remaining in the Participant's Employer
     Contributions Sub-Account will be forfeited and his Separate Account closed
     as of (i) the Participant's Settlement Date, if the Participant has no
     vested interest in his Separate Account, or (ii) the date the single sum
     payment occurs.

(b)  If the Participant's vested interest in his Separate Account exceeds $3,500
     and the Participant is eligible for and consents in writing to a single sum
     payment of his vested interest in his Separate Account, the non-vested
     balance remaining in the Participant's Employer Contributions Sub-Account
     will be forfeited and his Separate Account closed as of the date the single
     sum payment occurs, provided that such distribution occurs prior to the end
     of the second Plan Year beginning on or after the Participant's Settlement
     Date.

(c)  If neither paragraph (a) nor paragraph (b) is applicable, the non-vested
     portion of the Participant's Employer Contributions Sub-Account will
     continue to be held in such Sub-Account and will not be forfeited until the
     end of the five-year period beginning on his Settlement Date.

Whenever the non-vested portion of a Participant's Employer Contributions
Sub-Account is forfeited under the provisions of the Plan with respect to a Plan
Year, the amount of such forfeiture, as of the last day of the Plan Year, shall
be applied first against Plan expenses for the Plan Year and then against the
Employer Contribution obligations for the Plan Year of the Employer for which
the Participant last performed services as an Employee. Notwithstanding the
foregoing, however, should the amount of all such forfeitures for any Plan Year
with respect to any Employer exceed the amount of such Employer's Employer
Contribution obligation for the Plan Year, the excess amount of such forfeitures
shall be held unallocated in a suspense account

                                       42
<PAGE>   43

established with respect to the Employer and shall for all Plan purposes be
applied against the Employer's Employer Contribution obligations for the
following Plan Year.

14.4 Recrediting of Forfeited Amounts

A former Participant who forfeited the non-vested portion of his Employer
Contributions Sub-Account in accordance with the provisions of this Article and
who is reemployed by an Employer or a Related Company shall have such forfeited
amounts recredited to a new Separate Account in his name, without adjustment for
interim gains or losses experienced by the Trust, if:

(a)  he returns to employment with an Employer or a Related Company before the
     end of the five-year period beginning on the later of his Settlement Date
     or the date he received distribution of his vested interest in his Separate
     Account;

(b)  he resumes employment covered under the Plan before the end of the
     five-year period beginning on the date he is reemployed; and

(c)  if he received distribution of his vested interest in his Separate Account,
     he repays to the Plan the full amount of such distribution before the end
     of the five-year period beginning on the date he is reemployed.

Funds needed in any Plan Year to recredit the Separate Account of a Participant
with the amounts of prior forfeitures in accordance with the preceding sentence
shall come first from forfeitures that arise during such Plan Year, and then
from Trust income earned in such Plan Year, with each Trust Fund being charged
with the amount of such income proportionately, unless his Employer chooses to
make an additional Employer Contribution, and shall finally be provided by his
Employer by way of a separate Employer Contribution.

                                       43
<PAGE>   44

                                   ARTICLE XV
                                  DISTRIBUTIONS

15.1 Distributions to Participants

A Participant whose Settlement Date occurs shall receive distribution of his
vested interest in his Separate Account in the form provided under Article XVI
beginning as soon as reasonably practicable following his Settlement Date or the
date his application for distribution is filed with the Administrator, if later.
In addition, a Participant who continues in employment with an Employer or a
Related Company after his Normal Retirement Date may elect to receive
distribution of all or any portion of his Separate Account in the form provided
under Article XVI at any time following his Normal Retirement Date.

15.2 Distributions to Beneficiaries

If a Participant dies prior to the date distribution of his vested interest in
his Separate Account begins under this Article, his Beneficiary shall receive
distribution of the Participant's vested interest in his Separate Account in the
form provided under Article XVI beginning as soon as reasonably practicable
following the date the Beneficiary's application for distribution is filed with
the Administrator. Unless distribution is to be made over the life or over a
period certain not greater than the life expectancy of the Beneficiary,
distribution of the Participant's entire vested interest shall be made to the
Beneficiary no later than the end of the fifth calendar year beginning after the
Participant's death. If distribution is to be made over the life or over a
period certain no greater than the life expectancy of the Beneficiary,
distribution shall commence no later than:

(a)  If the Beneficiary is not the Participant's spouse, the end of the first
     calendar year beginning after the Participant's death; or

(b)  If the Beneficiary is the Participant's spouse, the later of (i) the end of
     the first calendar year beginning after the Participant's death or (ii) the
     end of the calendar year in which the Participant would have attained age
     70 1/2.

If distribution is to be made to a Participant's spouse, it shall be made
available within a reasonable period of time after the Participant's death that
is no less favorable than the period of time applicable to other distributions.
If a Participant dies after the date distribution of his vested interest in his
Separate Account begins under this Article, but before his entire vested
interest in his Separate Account is distributed, his Beneficiary shall receive
distribution of the remainder of the Participant's vested interest in his
Separate Account beginning as soon as reasonably practicable following the
Participant's date of death in a form that provides for distribution at least as
rapidly as under the form in which the Participant was receiving distribution.

15.3 Cash Outs and Participant Consent

Notwithstanding any other provision of the Plan to the contrary, if a
Participant's vested interest in his Separate Account does not exceed $3,500,
distribution of such vested interest shall be made to the Participant in a
single sum payment as soon as reasonably practicable following his Settlement
Date. If a Participant's vested interest in his Separate Account is $0, he shall
be deemed to have received distribution of such vested interest as of his
Settlement Date. If a Participant's vested interest in his Separate Account
exceeds $3,500, distribution shall not commence to such Participant prior to his
Normal Retirement Date without the Participant's written consent and the written
consent of his spouse if the Participant's Separate Account is

                                       44
<PAGE>   45

subject to the qualified joint and survivor annuity provisions under Article XVI
and payment is not made through the purchase of a qualified joint and survivor
annuity. If at the time of a distribution or deemed distribution to a
Participant from his Separate Account, the Participant's vested interest in his
Separate Account exceeded $3,500, then for purposes of this Section, the
Participant's vested interest in his Separate Account on any subsequent date
shall be deemed to exceed $3,500.

15.4 Required Commencement of Distribution

Notwithstanding any other provision of the Plan to the contrary, distribution of
a Participant's vested interest in his Separate Account shall commence to the
Participant no later than the earlier of:

(a)  60 days after the close of the Plan Year in which (i) the Participant's
     Normal Retirement Date occurs, (ii) the 10th anniversary of the year in
     which he commenced participation in the Plan occurs, or (iii) his
     Settlement Date occurs, whichever is latest; or

(b)  the April 1 following the close of the calendar year in which he attains
     age 70 1/2, whether or not his Settlement Date has occurred, except that if
     a Participant attained age 70 1/2 prior to January 1, 1988, and was not a
     five-percent owner (as defined in Section 416 of the Code) at any time
     during the five-Plan-Year period ending within the calendar year in which
     he attained age 70 1/2, distribution of such Participant's vested interest
     in his Separate Account shall commence no later than the April 1 following
     the close of the calendar year in which he attains age 70 1/2 or retires,
     whichever is later.

Distributions required to commence under this Section shall be made in the form
provided under Article XVI and in accordance with Section 401(a) (9) of the Code
and regulations issued thereunder, including the minimum distribution incidental
benefit requirements.

15.5 Reemployment of a Participant

If a Participant whose Settlement Date has occurred is reemployed by an Employer
or a Related Company, he shall lose his right to any distribution or further
distributions from the Trust arising from his prior Settlement Date and his
interest in the Trust shall thereafter be treated in the same manner as that of
any other Participant whose Settlement Date has not occurred.

15.6 Restrictions on Alienation

Except as provided in Section 401(a) (13) of the Code relating to qualified
domestic relations orders and Section 1.401(a) - 13(b) (2) of Treasury
regulations relating to Federal tax levies and judgments, no benefit under the
Plan at any time shall be subject in any manner to anticipation, alienation,
assignment (either at law or in equity), encumbrance, garnishment, levy,
execution, or other legal or equitable process; and no person shall have power
in any manner to anticipate, transfer, assign (either at law or in equity),
alienate or subject to attachment, garnishment, levy, execution, or other legal
or equitable process, or in any way encumber his benefits under the Plan, or any
part thereof, and any attempt to do so shall be void.

                                       45
<PAGE>   46

15.7 Facility of Payment

If the Administrator finds that any individual to whom an amount is payable
hereunder is incapable of attending to his financial affairs because of any
mental or physical condition, including the infirmities of advanced age, such
amount (unless prior claim therefore shall have been made by a duly qualified
guardian or other legal representative) may, in the discretion of the
Administrator, be paid to another person for the use or benefit of the
individual found incapable of attending to his financial affairs or in
satisfaction of legal obligations incurred by or on behalf of such individual.
The Trustee shall make such payment only upon receipt of written instructions to
such effect from the Administrator. Any such payment shall be charged to the
Separate Account from which any such payment would otherwise have been paid to
the individual found incapable of attending to his financial affairs and shall
be a complete discharge of any liability therefore under the Plan.

15.8 Inability to Locate Payee

If any benefit becomes payable to any person, or to the executor or
administrator of any deceased person, and if that person or his executor or
administrator does not present himself to the Administrator within a reasonable
period after the Administrator mails written notice of his eligibility to
receive a distribution hereunder to his last known address and makes such other
diligent effort to locate the person as the Administrator determines, that
benefit will be forfeited. However, if the payee later files a claim for that
benefit, the benefit will be restored.

15.9 Distribution Pursuant to Qualified Domestic Relations Orders

Notwithstanding any other provision of the Plan to the contrary, if a qualified
domestic relations order so provides, distribution may be made to an alternate
payee pursuant to a qualified domestic relations order, as defined in Section
414(p) of the Code, regardless of whether the Participant's Settlement Date has
occurred or whether the Participant is otherwise entitled to receive a
distribution under the Plan.


                                       46
<PAGE>   47

                                   ARTICLE XVI
                                 FORM OF PAYMENT

16.1 Definitions

For purposes of this Article, the following terms have the following meanings:

(a)  A Participant's "annuity starting date" means the first day of the first
     period for which an amount is paid as an annuity or any other form.

(b)  The "automatic annuity form" means the form of annuity that will be
     purchased on behalf of a Participant who has elected the optional annuity
     form of payment unless the Participant elects another form of annuity.

(c)  A "qualified election" means an election that is made during the qualified
     election period. A qualified election of a form of payment other than a
     qualified joint and survivor annuity or designating a Beneficiary other
     than the Participant's spouse to receive amounts otherwise payable as a
     qualified preretirement survivor annuity must include the written consent
     of the Participant's spouse, if any. A Participant's spouse will be deemed
     to have given written consent to the Participant's election if the
     Participant establishes to the satisfaction of a Plan representative that
     spousal consent cannot be obtained because the spouse cannot be located or
     because of other circumstances set forth in Section 401(a) (11) of the Code
     and regulations issued thereunder. The spouse's written consent must
     acknowledge the effect of the Participant's election and must be witnessed
     by a Plan representative or a notary public. In addition, the spouse's
     written consent must either (i) specify the form of payment selected
     instead of a joint and survivor annuity, if applicable, and that such form
     may not be changed (except to a qualified joint and survivor annuity)
     without written spousal consent and specify any non-spouse Beneficiary
     designated by the Participant, if applicable, and that such Beneficiary
     many not be changed without written spousal consent or (ii) acknowledge
     that the spouse has the right to limit consent as provided in clause (i),
     but permit the Participant to change the form of payment selected or the
     designated Beneficiary without the spouse's further consent. Any written
     consent given or deemed to have been given by a Participant's spouse
     hereunder shall be irrevocable and shall be effective only with respect to
     such spouse and not with respect to any subsequent spouse.

(d)  The "qualified election period" with respect to the automatic annuity form
     means the 90 day period ending on a Participant's annuity starting date.
     The "qualified election period" with respect to a qualified preretirement
     survivor annuity means the period beginning on the later of (i) the date he
     elects an annuity form of payment or (ii) the first day of the Plan Year in
     which the Participant attains age 35 or, if he terminates employment prior
     to such date, the day he terminates employment with his Employer and all
     Related Companies. A Participant whose employment has not terminated may
     make a qualified election designating a Beneficiary other than his spouse
     prior to the Plan Year in which he attains age 35; provided, however, that
     such election shall cease to be effective as of the first day of the Plan
     Year in which the Participant attains age 35.

                                       47
<PAGE>   48

(e)  A "qualified joint and survivor annuity" means an immediate annuity payable
     at earliest retirement age under the Plan, as defined in regulations issued
     under Section 401(a) (11) of the Code, for the life of a Participant with a
     survivor annuity payable for the life of the Participant's spouse that is
     equal to at least 50 percent of the amount of the annuity payable during
     the joint lives of the Participant and his spouse, provided that the
     survivor annuity shall not be payable to a Participant's spouse if such
     spouse is not the same spouse to whom the Participant was married on his
     annuity starting date.

(f)  A "qualified preretirement survivor annuity" means an annuity payable to
     the surviving spouse of a Participant in accordance with the provisions of
     Section 16.6.

(g)  A "single life annuity" means an annuity payable for the life of the
     Participant.

16.2 Normal Form of Payment

Except as otherwise provided in Section 16.6, unless a Participant, or his
Beneficiary, if the Participant has died, elects the option form of payment,
distribution shall be made to the Participant, or his Beneficiary, as the case
may be, in a single sum payment. Distribution of the fair market value of the
Participant's Separate Account shall be made in cash or in kind, as elected by
the Participant.

16.3 Optional Form of Payment

A Participant, or his Beneficiary, as the case may be, may elect to receive
distribution through the purchase of a single premium, nontransferable annuity
contract for such term and in such form as the Participant, or his Beneficiary,
if the Participant has died, shall select, subject to the provisions of Section
16.5; provided, however, that a Participant's Beneficiary may not elect to
receive distribution of an annuity payable over the joint lives of the
Beneficiary and any other individual. The terms of any annuity contract
purchased hereunder and distributed to a Participant or his Beneficiary shall
comply with the requirements of the Plan.

16.4 Change of Option Election

Subject to the provisions of Section 16.5, a Participant or Beneficiary who has
elected the optional form of payment may revoke or change his election at any
time prior to his annuity starting date by filing with the Administrator a
written election in the form prescribed by the Administrator.

16.5 Form of Annuity Requirements

If a Participant elects to receive distribution through the purchase of an
annuity contract, distribution shall be made to such Participant through the
purchase of an annuity contract that provides for payment in one of the
following automatic annuity forms, unless the Participant elects a different
type of annuity:

(a)  The automatic annuity form for a Participant who is married on his annuity
     starting date is the 50 percent qualified joint and survivor annuity.

(b)  The automatic annuity form for a Participant who is not married on his
     annuity starting date is the single life annuity.

                                       48
<PAGE>   49

A Participant's election of an annuity other than the automatic annuity form
shall not be effective unless it is a qualified election; provided, however,
that spousal consent shall not be required if the form of annuity elected by the
Participant is a qualified joint and survivor annuity. A Participant who has
elected the optional annuity form of payment can revoke or change his elections
only pursuant to a qualified election.

16.6 Qualified Preretirement Survivor Annuity Requirements

If a married Participant elects to receive distribution through the purchase of
an annuity contract and dies before his annuity starting date, his spouse shall
receive distribution of the value of the Participant's vested interest in his
Separate Account through the purchase of an annuity contract that provides for
payment over the life of the Participant's spouse. A Participant's spouse may
elect to receive distribution under any one of the other forms of payment
available under this Article instead of in the qualified preretirement survivor
annuity form. If a married Participant's Beneficiary designation on file with
the Administrator pursuant to Article XVII designates a non-spouse Beneficiary,
the designation shall become inoperative upon the Participant's election to
receive distribution through the purchase of an annuity contract, unless the
Participant files a new designation of Beneficiary form with the Administrator.
A Participant can only designate a non-spouse Beneficiary to receive
distribution of that portion of his Separate Account otherwise payable as a
qualified preretirement survivor annuity pursuant to a qualified election.

16.7 Direct Rollover

Notwithstanding any other provision of the Plan to the contrary, in lieu of
receiving distribution in the form of payment provided under this Article, a
"qualified distributee" may elect in writing, in accordance with rules
prescribed by the Administrator, to have any portion or all of a distribution
made on or after January 1, 1993, that is an "eligible rollover distribution"
paid directly by the Plan to the "eligible retirement plan" designated by the
"qualified distributee"; provided, however, that this provision shall not apply
if the total distribution is less than $200 and that a "qualified distributee"
may not elect this provision with respect to a portion of a distribution that is
less than $500. Any such payment by the Plan to another "eligible retirement
plan" shall be a direct rollover and shall be made only after all applicable
consent requirements are satisfied. For purpose of this Section, the following
terms have the following meanings:

(a)  An "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 rollovers; provided, however, that, in the
     case of a direct rollover by a surviving spouse, an eligible retirement
     plan does not include a qualified trust described in Section 401(a) of the
     Code.

(b)  An "eligible rollover distribution" means any distribution of all or any
     portion of the balance of a Participant's Separate Account; provided,
     however, that an eligible rollover distribution does not include: any
     distribution that is one of a series of substantially equal periodic
     payments made not less frequently than annually for the life or life
     expectancy of the qualified distributee or the joint lives or joint life
     expectancies of the qualified distributee and qualified distributee's
     designated beneficiary, or for a specified period of ten years or more; and
     any distribution to the extent such distribution is required under Section
     401(a) (9) of the Code.

                                       49
<PAGE>   50

(c)  A "qualified distributee" means a Participant, his surviving spouse, or his
     spouse or former spouse who is an alternate payee under a qualified
     domestic relations order, as defined in Section 414(p) of the Code.

16.8 Notice Regarding Forms of Payment

Within the 60 day period ending 30 days before a Participant's annuity starting
date, the Administrator shall provide him with a written explanation of his
right to defer distribution until his Normal Retirement Date, or such later date
as may be provided in the Plan, his right to make a direct rollover, and the
forms of payment available under the Plan, including a written explanation of
(i) the terms and conditions of the automatic annuity form applicable if the
Participant elects to receive distribution through the purchase of an annuity
contract, (ii) the Participant's right to choose a form of payment other than
the automatic annuity form or to revoke such choice, and (iii) the rights of the
Participant's spouse. Notwithstanding the foregoing, distribution of the
Participant's Separate Account may commence less than 30 days after such notice
is provided to the Participant if (i) the Administrator clearly informs the
Participant of his right to consider his election of whether or not to make a
direct rollover and his election of a form of payment for a period of at least
30 days following his receipt of the notice, (ii) the Participant, after
receiving the notice, affirmatively elects an early distribution with his
spouse's written consent, if necessary, (iii) the Participant's annuity starting
date is a date after the date the notice is provided to him, (iv) the
Participant may revoke his election at any time prior to the later of his
annuity starting date or the expiration of the seven-day period beginning the
day after the date the notice is provided to him, and (v) distribution does not
commence to the Participant before such revocation period ends.

In addition, the Administrator shall provide such a Participant with a written
explanation of (i) the terms and conditions of the qualified preretirement
survivor annuity, (ii) the Participant's right to designate a non-spouse
Beneficiary to receive distribution of that portion of his Separate Account
otherwise payable as a qualified preretirement survivor annuity or to revoke
such designation, and (iii) the rights of the Participant's spouse. The
Administrator shall provide such explanation within one of the following
periods, whichever ends last:

(a)  the period beginning with the first day of the Plan Year in which the
     Participant attains age 32 and ending on the last day of the Plan Year
     preceding the Plan Year in which the Participant attains age 35:

(b)  the period beginning 12 calendar months before the date an individual
     becomes a Participant and ending 12 calendar months after such date; or

(c)  the period beginning 12 calendar months before the date the Participant
     elects to receive distribution through the purchase of an annuity contract
     and ending 12 calendar months after such date;

provided, however, that in the case of a Participant who separates from service
prior to attaining age 35, the explanation shall be provided to such Participant
within the period beginning 12 calendar months before the Participant's
separation from service and ending 12 calendar months after his separation from
service.

                                       50
<PAGE>   51

16.9 Reemployment

If a Participant is reemployed by an Employer or a Related Company prior to
receiving distribution of the entire balance of his vested interest in his
Separate Account, his prior election of a form of payment hereunder shall become
ineffective. Notwithstanding the foregoing, if a Participant had elected to
receive distribution through the purchase of an annuity contract, the
requirements of Sections 16.5 and 16.6 of the Plan shall continue in effect to
his entire Separate Account.



                                       51
<PAGE>   52

                                  ARTICLE XVII
                                  BENEFICIARIES

17.1 Designation of Beneficiary

A married Participant's Beneficiary shall be his spouse, unless the Participant
designates a person or persons other than his spouse as Beneficiary with his
spouse's written consent. A Participant may designate a Beneficiary on the form
prescribed by the Administrator. If no Beneficiary has been designated pursuant
to the provisions of this Section, or if no Beneficiary survives the Participant
and he has no surviving spouse, then the Beneficiary under the Plan shall be the
Participant's estate. If a Beneficiary dies after becoming entitled to receive a
distribution under the Plan but before distribution is made to him in full, and
if no other Beneficiary has been designated to receive the balance of the
distribution in that event, the estate of the deceased Beneficiary shall be the
Beneficiary as to the balance of the distribution. A Participant's designation
of a Beneficiary shall be subject to the qualified preretirement survivor
annuity provisions of Article XVI.

17.2 Spousal Consent Requirements

Any written spousal consent given pursuant to this Article must acknowledge the
effect of the action taken and must be witnessed by a Plan representative or a
notary public. In addition, the spouse's written consent must either (i) specify
any non-spouse Beneficiary designated by the Participant and that such
Beneficiary may not be changed without written spousal consent or (ii)
acknowledge that the spouse has the right to limit consent to a specific
Beneficiary, but permit the Participant to change the designated Beneficiary
without the spouse's further consent. A Participant's spouse will be deemed to
have given written consent to the Participant's designation of Beneficiary if
the Participant establishes to the satisfaction of a Plan representative that
such consent cannot be obtained because the spouse cannot be located or because
of other circumstances set forth in Section 401(a) (11) of the Code and
regulations issued thereunder. Any written consent given or deemed to have been
given by a Participant's spouse hereunder shall be valid only with respect to
the spouse who signs the consent.


                                       52
<PAGE>   53

                                  ARTICLE XVIII
                                 ADMINISTRATION

18.1 Authority of the Sponsor

The Sponsor, which shall be the administrator for purposes of ERISA and the plan
administrator for purposes of the Code, shall be responsible for the
administration of the Plan and, in additon to the power and authorities
expressly conferred upon it in the Plan, shall have all such powers and
authorities as may be necessary to carry out the provisions of the Plan,
including the power and authority to interpret and construe the provisions of
the Plan, to make benefit determinations, and to resolve any disputes which
arise under the Plan. The Sponsor may employ such attorneys, agents, and
accountants as it may deem necessary or advisable to assist in carrying out its
duties hereunder. The Sponsor shall be a "named fiduciary" as that term is
defined in Section 402(a) (2) of ERISA. The Sponsor may:

(a)  allocate any of the powers, authority, or responsibilities for the
     operation and administration of the Plan (other than trustee
     responsibilities as defined in Section 405(c) (3) of ERISA) among named
     fiduciaries, and

(b)  designate a person or persons other than a named fiduciary to carry out any
     of such powers, authority, or responsibilities;

except that no allocation by the Sponsor of, or designation by the Sponsor with
respect to, any of such powers, authority, or responsibilities to another named
fiduciary or a person other than a named fiduciary shall become effective unless
such allocation or designation shall first be accepted by such named fiduciary
or other person in a writing signed by it and delivered to the Sponsor.

18.2 Action of the Sponsor

Any act authorized, permitted, or required to be taken under the Plan by the
Sponsor and which has not been delegated in accordance with Section 18.1, may be
taken by a majority of the members of the board of directors of the Sponsor,
either by vote at a meeting, or in writing without a meeting, or by the employee
or employees of the Sponsor designated by the board of directors to carry out
such acts on behalf of the Sponsor. All notices, advice, directions,
certifications, approvals, and instruction required or authorized to be given by
the Sponsor as under the Plan shall be in writing and signed by either (i) a
majority of the members of the board of directors of the Sponsor or by such
member or members as may be designated by an instrument in writing, signed by
all the members thereof, as having authority to execute such document on its
behalf, or (ii) the employee or employees authorized to act for the sponsor in
accordance with the provisions of this Section.

18.3 Claims Review Procedure

Whenever a claim for benefits under the Plan filed by any person (herein
referred to as the "Claimant") is denied, whether in whole or in part, the
Sponsor shall transmit a written notice of such decision to the claimant within
90 days of the date the claim was filed or, if special circumstances require an
extension, within 180 days of such date, which notice shall be written in a
manner calculated to be understood by the Claimant and shall contain a statement
of (i) the specific reasons for the denial of the claim, (ii) specific reference
to pertinent Plan provisions on which the denial is based, and (iii) a
description of any additional material or information

                                       53
<PAGE>   54

necessary for the Claimant to perfect the claim and an explanation of why such
information is necessary. The notice shall also include a statement advising the
Claimant that, within 60 days of the date on which he receives such notice, he
may obtain review of such decision in accordance with the procedures hereinafter
set forth. Within such 60-day period, the Claimant or his authorized
representative may request that the claim denial be reviewed by filing with the
Sponsor a written request therefor, which request shall contain the following
information:

(a)  the date on which the Claimant's request was filed with the Sponsor;
     provided, however, that the date on which the Claimant's request for review
     was in fact filed with the Sponsor shall control in the event that the date
     of the actual filing is later than the date stated by the Claimant pursuant
     to this paragraph;

(b)  the specific portions of the denial of his claim which the Claimant
     requests the Sponsor to review;

(c)  a statement by the Claimant setting forth the basis upon which he believes
     the Sponsor should reverse the previous denial of his claim for benefits
     and accept his claim as made; and

(d)  any written material (offered as exhibits) which the Claimant desires the
     Sponsor to examine in its consideration of his position as stated pursuant
     to paragraph (c) of this Section.

Within 60 days of the date determined pursuant to paragraph (a) of this Section
or, if special circumstances require an extension, within 120 days of such date,
the Sponsor shall conduct a full and fair review of the decision denying the
Claimant's claim for benefits and shall render its written decision on review to
the Claimant. The Sponsor's decision on review shall be written in a manner
calculated to be understood by the Claimant and shall specify the reasons and
Plan provisions upon which the Sponsor's decision was based.

18.4 Qualified Domestic Relations Orders

The Sponsor shall establish reasonable procedures to determine the status of
domestic relations orders and to administer distributions under domestic
relations orders which are deemed to be qualified orders. Such procedures shall
be in writing and shall comply with the provisions of Section 414(p) of the Code
and regulations issued thereunder.

18.5 Indemnification

In addition to whatever rights of indemnification the members of the board of
directors of the Sponsor or any employee or employees of the Sponsor to whom any
power, authority, or responsibility is delegated pursuant to Section 18.2, may
be entitled under the articles of incorporation or regulations of the Sponsor,
under any provision of law, or under any other agreement, the Sponsor shall
satisfy any liability actually and reasonably incurred by any such person or
persons, including expenses, attorneys' fees, judgments, fines, and amounts paid
in settlement (other than amounts paid in settlement not approved by the
Sponsor), in connection with any threatened, pending or completed action, suit,
or proceeding which is related to the exercising or failure to exercise by such
person or persons of any of the powers, authority, responsibilities, or
discretion as provided under the Plan, or reasonably believed by such person or
persons to be provided hereunder, and any action taken by such person or persons
in

                                       54
<PAGE>   55

connection therewith, unless the same is judicially determined to be the result
of such person or persons' gross negligence or willful misconduct.

18.6 Actions Binding

Subject to the provisions of Section 18.3, any action taken by the Sponsor which
is authorized, permitted, or required under the Plan shall be final and binding
upon the Employers, the Trustee, all persons who have or who claim an interest
under the Plan, and all third parties dealing with the Employers or the Trustee.



                                       55
<PAGE>   56

                                   ARTICLE XIX
                            AMENDMENT AND TERMINATION

19.1 Amendment

Subject to the provisions of Section 19.2, the Sponsor may at any time and from
time to time, by action of its board of directors, or such officers of the
Sponsor as are authorized by its board of directors, amend the Plan, either
prospectively or retroactively. Any such amendment shall be by written
instrument executed by the Sponsor.

19.2 Limitation on Amendment

The Sponsor shall make no amendment to the Plan which shall decrease the accrued
benefit of any Participant or Beneficiary, except that nothing contained herein
shall restrict the right to amend the provisions of the Plan relating to the
administration of the Plan and Trust. Moreover, no such amendment shall be made
hereunder which shall permit any part of the Trust to revert to an Employer or
any Related Company or be used or be diverted to purposes other than the
exclusive benefit of Participants and Beneficiaries.

19.3 Termination

The Sponsor reserves the right, by action of its board of directors, to
terminate the Plan as to all Employers at any time (the effective date of such
termination being hereinafter referred to as the "termination date"). Upon any
such termination of the Plan, the following actions shall be taken for the
benefit of Participants and Beneficiaries:

(a)  As of the termination date, each Investment Fund shall be valued and all
     Separate Accounts and Sub-Accounts shall be adjusted in the manner provided
     in Article XI, with any unallocated contributions or forfeitures being
     allocated as of the termination date in the manner otherwise provided in
     the Plan. The termination date shall become a Valuation Date for purposes
     of Article XI. In determining the net worth of the Trust, there shall be
     included as a liability such amounts as shall be necessary to pay all
     expenses in connection with the termination of the Trust and the
     liquidation and distribution of the property of the Trust, as well as other
     expenses, whether or not accrued, and shall include as an asset all accrued
     income.

(b)  All Separate Accounts shall then be disposed of to or for the benefit of
     each Participant or Beneficiary in accordance with the provisions of
     Article XV as if the termination date were his Settlement Date; provided,
     however, that notwithstanding the provisions of Article XV, if the Plan
     does not offer an annuity option and if neither his Employer nor a Related
     Company establishes or maintains another defined contribution plan (other
     than an employee stock ownership plan as defined in Section 4975(e) (7) of
     the Code), the Participant's written consent to the commencement of
     distribution shall not be required regardless of the value of the vested
     portions of his Separate Account.

(c)  Notwithstanding the provisions of paragraph (b) of this Section, no
     distribution shall be made to a Participant of any portion of the balance
     of his Tax-Deferred Contributions Sub-Account prior to his separation from
     service (other than a distribution made in accordance with Article XIII or
     required in accordance with Section 401(a) (9) of the Code) unless (i)
     neither his Employer nor a Related Company establishes or maintains another
     defined contribution Plan (other than an employee stock ownership plan as

                                       56
<PAGE>   57

     defined in Section 4975(e) (7) of the Code, a tax credit employee stock
     ownership plan as defined in Section 409 of the Code, or a simplified
     employee pension as defined in Section 408(k) of the Code) either at the
     time the Plan is terminated or at any time during the period ending 12
     months after distribution of all assets from the Plan; provided, however,
     that this provision shall not apply if fewer than two percent of the
     Eligible Employees under the Plan were eligible to participate at any time
     in such other defined contribution plan during the 24-month period
     beginning 12 months before the Plan termination, and (ii) the distribution
     the Participant receives is a "lump sum distribution" as defined in Section
     402(e) (4) of the Code, without regard to clauses (i), (ii), (iii), and
     (iv) of sub-paragraph (A), sub-paragraph (B), or sub-paragraph (H) thereof.

Notwithstanding anything to the contrary contained in the Plan, upon any such
Plan termination, the vested interest of each Participant and Beneficiary in his
Employer Contributions Sub-Account shall be 100 percent; and, if there is a
partial termination of the Plan, the vested interest of each Participant and
Beneficiary who is affected by the partial termination in his Employer
Contributions Sub-Account shall be 100 percent. For purposes of the preceding
sentence only, the Plan shall be deemed to terminate automatically if there
shall be a complete discontinuance of contributions hereunder by all Employers.

19.4 Reorganization

The merger, consolidation, or liquidation of any Employer with or into any other
Employer or a Related Company shall not constitute a termination of the Plan as
to such Employer. If an Employer disposes of substantially all of the assets
used by the Employer in a trade or business or disposes of a subsidiary and in
connection therewith one or more Participants terminates employment but
continues in employment with the purchaser of the assets or with such
subsidiary, no distribution from the Plan shall be made to any such Participant
prior to his separation from service (other than a distribution made in
accordance with Article XIII or required in accordance with Section 401(a) (9)
of the Code), except that a distribution shall be permitted to be made in such a
case, subject to the Participant's consent (to the extent required by law), if
(i) the distribution would constitute a "lump sum distribution" as defined in
Section 402(e) (4) of the Code, without regard to clauses (i), (ii), (iii), or
(iv) of sub-paragraph (A), sub-paragraph (B), or sub-paragraph (H) thereof, (ii)
the Employer continues to maintain the Plan after the disposition, (iii) the
purchaser does not maintain the Plan after the disposition, and (iv) the
distribution is made by the end if the second calendar year after the calendar
year in which the disposition occurred.

19.5 Withdrawal of an Employer

An Employer other than the Sponsor may withdraw from the Plan at any time upon
notice in writing to the Administrator (the effective date of such withdrawal
being hereinafter referred to as "withdrawal date"), and shall thereupon cease
to be an Employer for all purposes of the Plan. An Employer shall be deemed
automatically to withdraw from the Plan in the event of its complete
discontinuance of contributions, or, subject to Section 19.4 and unless the
Sponsor otherwise directs, it ceases to be a Related Company of the Sponsor or
any other Employer. Upon the withdrawal of an Employer, the withdrawing Employer
shall determine whether a partial termination has occurred with respect to its
Employees. In the event that the withdrawing Employer determines a partial
termination has occurred, the action specified in Section 19.3 shall be taken as
of the withdrawal date, as on a termination of the Plan, but with respect only
to Participants who are employed solely by the withdrawing Employer, and who,
upon such withdrawal, are neither transferred to nor continued in employment
with any other Employer or a

                                       57
<PAGE>   58

Related Company. The interest of any Participant employed by the withdrawing
Employer who is transferred to or continues in employment with any other
Employer or a Related Company, and the interest of any Participant employed
solely by an Employer or a Related Company other than the withdrawing Employer,
shall remain unaffected by such withdrawal; no adjustment to his Separate
Accounts shall be made by reason of the withdrawal; and he shall continue as a
Participant hereunder subject to the remaining provisions of the Plan.

                                       58
<PAGE>   59

                                   ARTICLE XX
                           ADOPTION BY OTHER ENTITIES

20.1 Adoption by Related Companies

A Related Company that is not an Employer may, with the consent of the Sponsor,
adopt the Plan and become an Employer hereunder by causing an appropriate
written instrument evidencing such adoption to be executed in accordance with
the requirements of its organizational authority. Any such instrument shall
specify the effective date of the adoption.

20.2 Effective Plan Provisions

An Employer who adopts the Plan shall be bound by the provisions of the Plan in
effect at the time of the adoption and as subsequently in effect because of any
amendment to the Plan.




                                       59
<PAGE>   60

                                   ARTICLE XXI
                            MISCELLANEOUS PROVISIONS

21.1 No Commitment as to Employment

Nothing contained herein shall be construed as a commitment or agreement upon
the part of any person to continue his employment with an Employer or Related
Company, or as a commitment on the part of any Employer or Related Company to
continue the employment, compensation, or benefits of any person for any period.

21.2 Benefits

Nothing in the Plan nor the Trust Agreement shall be construed to confer any
right or claim upon any person, firm, or corporation other than the Employers,
the Trustee, Participants, and Beneficiaries.

21.3 No Guarantees

The Employers, the Administrator, and the Trustee do not guarantee the Trust
from loss or depreciation, nor do they guarantee the payment of any amount which
may become due to any person hereunder.

21.4 Expenses

The expenses of administration of the Plan, including the expenses of the
Administrator and fees of the Trustee, shall be paid from the Trust as a general
charge thereon, unless the Sponsor elects to make payment. Notwithstanding the
foregoing, the Sponsor may direct that administrative expenses that are
allocable to the Separate Account of a specific Participant shall be paid from
that Separate Account and the costs incident to the management of the assets of
an Investment Fund or to the purchase or sale of securities held in an
Investment Fund shall be paid by the Trustee from such Investment Fund.

21.5 Precedent

Except as otherwise specifically provided, no action taken in accordance with
the Plan shall be construed or relied upon as a precedent for similar action
under similar circumstances.

21.6 Duty to Furnish Information

The Employers, the Administrator, and the Trustee shall furnish to any of the
others any documents, reports, returns, statements, or other information that
the other reasonably deems necessary to perform its duties hereunder or
otherwise imposed by law.

21.7 Withholding

The Trustee shall withhold any tax which by any present or future law is
required to be withheld, and which the Administrator notifies the Trustee in
writing is to be so withheld, from any payment to any Participant or Beneficiary
hereunder.

                                       60
<PAGE>   61

21.8 Merger, Consolidation, or Transfer of Plan Assets

The Plan shall not be merged or consolidated with any other plan, nor shall any
of its assets or liabilities be transferred to another plan, unless, immediately
after such merger, consolidation, or transfer of assets or liabilities, each
Participant in the Plan would receive a benefit under the Plan which is at least
equal to the benefit he would have received immediately prior to such merger,
consolidation, or transfer of assets or liabilities (assuming in each instance
that the Plan had then terminated).

21.9 Back Pay Awards

The provisions of this Section shall apply only to an Employee who becomes
entitled to back pay by an award or agreement of an Employer without regard to
mitigation of damages. If a person to whom this Section applies was or would
have become an Eligible Employee after such back pay award or agreement has been
effected, and if any such person who had not previously elected to make
Tax-Deferred Contributions pursuant to Section 4.1 shall within 30 days of the
date he receives notice of the provisions of this Section make an election to
make Tax-Deferred Contributions in accordance with such Section 4.1 (retroactive
to any Enrollment Date as of which he was or has become eligible to do so), then
such Participant may elect that any Tax-Deferred Contributions not previously
made on his behalf but which, after application of the foregoing provisions of
this Section, would have been made under the provisions of Article IV, shall be
made out of the proceeds of such back pay award or agreement. In addition, if
any such Employee would have been eligible to participate in the allocation of
Employer Contributions under the provisions of Article VI for any prior Plan
Year after such back pay award or agreement has been effected, his Employer
shall make an Employer Contribution equal to the amount of the Employer
Contribution which would have been allocated to such Participant under the
provisions of Article VI as in effect during each such Plan Year. The amounts of
such additional contributions shall be credited to the Separate Account of such
Participant. Any additional contributions made by such Participant and by an
Employer pursuant to this Section shall be made in accordance with, and subject
of the limitations of the applicable provisions of Articles IV, VI, and VII.

21.10 Condition on Employer Contributions

Notwithstanding anything to the contrary contained in the Plan or the Trust
Agreement, any contribution of an Employer hereunder is conditioned upon the
continued qualification of the Plan under Section 401(a) of the Code, the exempt
status of the Trust under Section 501(a) of the Code, and the deductibility of
the contribution under Section 404 of the Code. Except as otherwise provided in
this Section and Section 21.11, however, in no event shall any portion of the
property of the Trust ever revert to or otherwise inure to the benefit of an
Employer or any Related Company.

21.11 Return of Contributions to an Employer

Notwithstanding any other provision of the Plan or the Trust Agreement to the
contrary, in the event any contribution of an Employer made hereunder:

(a)  is made under a mistake of fact, or

(b)  is disallowed as a deduction under Section 404 of the Code,

                                       61
<PAGE>   62

such contribution may be returned to the Employer within one year after the
payment of the contribution or the disallowance of the deduction to the extent
disallowed, whichever is applicable. In the event the Plan does not initially
qualify under Section 401(a) of the Code, any contribution of an Employer made
hereunder may be returned to the Employer within one year of the date of denial
of the initial qualification of the Plan, but only if an application for
determination was made within the period of time prescribed under Section 403(c)
(2) (B) of ERISA.

21.12 Validity of Plan

The validity of the Plan shall be determined and the Plan shall be construed and
interpreted in accordance with the laws of the State or Commonwealth in which
the Sponsor has its principal place of business, except as preempted by
applicable Federal law. The invalidity or illegality of any provision of the
Plan shall not affect the legality or validity of any other part thereof.

21.13 Trust Agreement

The Trust Agreement and the Trust maintained thereunder shall be deemed to be a
part of the Plan as if fully set forth herein and the provisions of the Trust
Agreement are hereby incorporated by reference into the Plan.

21.14 Parties Bound

The Plan shall be binding upon the Employers, all Participants and Beneficiaries
hereunder, and, as the case may be, the heirs, executors, administrators,
successors, and assigns of each of them.

21.15 Application of Certain Plan Provisions

A Participant's Beneficiary, if the Participant has died, or alternate payee
under a qualified domestic relations order shall be treated as a Participant for
purposes of directing investments as provided in Article X. For purposes of the
general administrative provisions and limitations of the Plan, a Participant's
Beneficiary or alternate payee under a qualified domestic relations order shall
be treated as any other person entitled to receive benefits under the Plan. Upon
any termination of the Plan, any such Beneficiary or alternate payee under a
qualified domestic relations order who has an interest under the Plan at the
time of such termination, which does not cease by reason thereof, shall be
deemed to be a Participant for all purposes of the Plan.

21.16 Leased Employees

Any leased employee, other than an excludable leased employee, shall be treated
as an employee of the Employer for which he performs services for all purposes
of the Plan with respect to the provisions of Sections 401(a) (3), (4), (7), and
(16), and 408(k), 410, 411, 415, and 416 of the Code; provided, however, that no
leased employee shall accrue a benefit hereunder based on service as a leased
employee except as otherwise specifically provided in the Plan. A "leased
employee" means any person who performs services for an Employer or a Related
Company (the "recipient") (other than an employee of the recipient) pursuant to
an agreement between the recipient and any other person (the "leasing
organization") on a substantially full-time basis for a period of at least one
year, provided that such services are of a type historically performed, in the
business field of the recipient, by employees. An "excludable leased employee"
means any leased employee of the recipient who is covered by a money purchase
pension plan maintained by the leasing organization which provides for (i) a
nonintegrated employer contribution on behalf of

                                       62
<PAGE>   63

each participant in the plan equal to at least ten percent of compensation, (ii)
full and immediate vesting, and (iii) immediate participation by employees of
the leasing organization (other than employees who perform substantially all of
their services for the leasing organization or whose compensation from the
leasing organization in each plan year during the four-year period ending with
the plan year is less than $1,000); provided, however, that leased employees do
not constitute more than 20 percent of the recipient's nonhighly compensated
work force. For purposes of this Section, contributions or benefits provided to
a leased employee by the leasing organization that are attributable to services
performed for the recipient shall be treated as provided by the recipient.

21.17 Transferred Funds

If funds from another qualified plan are transferred or merged into the Plan,
such funds shall be held and administered in accordance with any restrictions
applicable to them under such other plan to the extent required by law and shall
be accounted for separately to the extent necessary to accomplish the foregoing.



                                       63
<PAGE>   64

                                  ARTICLE XXII
                              TOP-HEAVY PROVISIONS

22.1 Definitions

For purposes of this Article, the following terms shall have the following
meanings:

(a)  The "compensation" of an employee means compensation as defined in Section
     415 of the Code and regulations issued thereunder. In no event, however,
     shall the compensation of a Participant taken into account under the Plan
     for any Plan Year exceed (1) $200,000 for Plan Years beginning prior to
     January 1, 1994, or (2) $150,000 for Plan Years beginning on or after
     January 1, 1994 (subject to adjustment annually as provided in Section
     401(a) (17) (B) and Section 415(d) of the Code; provided, however, that the
     dollar increase in effect on January 1 of any calendar year, if any, is
     effective for Plan Years beginning in such calendar year). If the
     compensation of a Participant is determined over a period of time that
     contains fewer than 12 calendar months, then the annual compensation
     limitation described above shall be adjusted with respect to the
     Participant by multiplying the annual compensation limitation in effect for
     the Plan Year by a fraction the numerator of which is the number of full
     months in the period and the denominator of which is 12; provided, however,
     that no proration is required for a Participant who is covered under the
     Plan for less than one full Plan Year if the formula for allocations is
     based on Compensation for a period of at least 12 months. In determining
     the compensation, for purposes of applying the annual compensation
     limitation described above, of a Participant who is a five-percent owner or
     one of the ten Highly Compensated Employees receiving the greatest
     compensation for the Plan Year, the compensation of the Participant's
     spouse and of his lineal descendants who have not attained age 19 as of the
     close of the Plan Year shall be included as compensation of the Participant
     for the Plan Year. If as a result of applying the family aggregation rule
     described in the preceding sentence the annual compensation limitation
     would be exceeded, the limitation shall be prorated among the affected
     family members in proportion to each member's compensation as determined
     prior to application of the family aggregation rules.

(b)  The "determination date" with respect to any Plan Year means the last day
     of the preceding Plan Year, except that the determination date with respect
     to the first Plan Year of the Plan, shall mean the last day of such Plan
     Year.

(c)  A "key employee" means any Employee or former Employee who is a key
     employee pursuant to the provisions of Section 416(i) (1) of the Code and
     any Beneficiary of such Employee or former Employee.

(d)  A "non-key employee" means any Employee who is not a key employee.

(e)  A "permissive aggregation group" means those plans included in each
     Employer's required aggregation group together with any other plan or plans
     of the Employer, so long as the entire group of plans would continue to
     meet the requirements of Sections 401(a) (4) and 410 of the Code.

                                       64
<PAGE>   65

(f)  A "required aggregation group" means the group of tax-qualified plans
     maintained by an Employer or a Related Company consisting of each plan in
     which a key employee participates and each other plan that enables a plan
     in which a key employee participates to meet the requirements of Section
     401(a) (4) or Section 410 of the Code, including any plan that terminated
     within the five-year period ending on the relevant determination date.

(g)  A "super top-heavy group" with respect to a particular Plan Year means a
     required or permissive aggregation group that, as of the determination
     date, would qualify as a top-heavy group under the definition in paragraph
     (i) of this Section with "90 percent" substituted for "60 percent" each
     place where "60 percent" appears in the definition.

(h)  A "super top-heavy plan" with respect to a particular Plan Year means a
     plan that, as of the determination date, would qualify as a top-heavy plan
     under the definition in paragraph (j) of this Section with "90 percent"
     substituted for "60 percent" each place where "60 percent" appears in the
     definition. A plan is also a "super top-heavy plan" if it is part of a
     super top-heavy group.

(i)  A "top-heavy group" with respect to a particular Plan Year means a required
     or permissive aggregation group if the sum, as of the determination date,
     of the present value of the cumulative accrued benefits for key employees
     under all defined benefit plans included in such group and the aggregate of
     the account balances of key employees under all defined contribution plans
     included in such group exceeds 60 percent of a similar sum determined for
     all employees covered by the plans included in such group.

(j)  A "top-heavy plan" with respect to a particular Plan Year means (i), in the
     case of a defined contribution plan (including any simplified employee
     pension plan), a plan for which, as of the determination date, the
     aggregate of the accounts (within the meaning of Section 416(g) of the Code
     and the regulations and rulings thereunder) of key employees exceeds 60
     percent of the aggregate of the accounts of all participants under the
     plan, with the accounts valued as of the relevant valuation date and
     increased for any distribution of an account balance made in the five-year
     period ending on the determination date, (ii), in the case of a defined
     benefit plan, a plan for which, as of the determination date, the present
     value of the cumulative accrued benefits payable under the plan (within the
     meaning of Section 416(g) of the Code and the regulations and rulings
     thereunder) to key employees exceeds 60 percent of the present value of the
     cumulative accrued benefits under the plan for all employees, with the
     present value of accrued benefits to be determined under the accrual method
     uniformly used under all plans maintained by an Employer or, if no such
     method exists, under the slowest accrual method permitted under the
     fractional accrual rate of Section 411(b) (1) (C) of the accrued benefits
     distributed in the five-year period ending on the determination date, and
     (iii) any plan (including any simplified employee pension plan) included in
     a required aggregation group that is a top-heavy group. For purposes of
     this paragraph, the accounts and accrued benefits of any employee who has
     not performed services for an Employer or a Related Company during the
     five-year period ending on the determination date shall be disregarded. For
     purposes of this paragraph, the present value of cumulative accrued
     benefits under a defined benefit plan for purposes of top-heavy
     determinations shall be calculated using the actuarial assumptions
     otherwise employed under such plan, except that the same actuarial
     assumptions shall be used for all plans within a required or permissive
     aggregation group. A Participant's interest in the Plan attributable to any
     Rollover Contributions, except Rollover Contributions made from a plan
     maintained by

                                       65
<PAGE>   66

     an Employer or a Related Company, shall not be considered in determining
     whether the Plan is top-heavy. Notwithstanding the foregoing, if a plan is
     included in a required or permissive aggregation group that is not a
     top-heavy group, such plan shall not be a top-heavy plan.

(k)  The "valuation date" with respect to any determination date means the most
     recent Valuation Date occurring within the 12-month period ending on the
     determination date.

22.2 Applicability

Notwithstanding any other provision of the Plan to the contrary, the provisions
of this Article shall be applicable during any Plan Year in which the Plan is
determined to be a top-heavy plan as hereinafter defined. If the Plan is
determined to be a top-heavy plan and upon a subsequent determination date is
determined no longer to be a top-heavy plan, the vesting provisions of Article
VI shall again become applicable as of such subsequent determination date;
provided, however, that if the prior vesting provisions do again become
applicable, any Employee with three or more years of Vesting Service may elect
in accordance with the provisions of Article VI, to continue to have his vested
interest in his Employer Contributions Sub-Account determined in accordance with
the vesting schedule specified in Section 22.5.

22.3 Minimum Employer Contribution

If the Plan is determined to be a top-heavy plan, the Employer Contributions
allocated to the Separate Account of each non-key employee who is an Eligible
Employee and who is employed by an Employer or a Related Company on the last day
of such top-heavy Plan Year shall be no less than the lesser of (i) three
percent of his compensation or (ii) the largest percentage of compensation that
is allocated as an Employer Contribution and/or Tax-Deferred Contribution for
such Plan Year to the Separate Account of any key employee; except that, in the
event the Plan is part of a required aggregation group, and the Plan enables a
defined benefit plan included in such group to meet the requirements of Section
401(a) (4) or 410 of the Code, the minimum allocation of Employer Contributions
to each such non-key employee shall be three percent of the compensation of such
non-key employee. Any minimum allocation to a non-key employee required by this
Section shall be made without regard to any social security contribution made on
behalf of the non-key employee, his number of hours of service, his level of
compensation, or whether he declined to make elective or mandatory
contributions. Notwithstanding the minimum top-heavy allocation requirements of
this Section, if the Plan is a top-heavy plan, each non-key employee who is an
Eligible Employee and who is employed by an Employer or a related Company on the
last day of a top-heavy Plan Year and who is also covered under a top-heavy
defined benefit plan maintained by an Employer or a Related Company will receive
the top-heavy benefits provided under the defined benefit plan in lieu of the
minimum top-heavy allocation under the Plan offset by the benefits provided
under the Plan.

22.4 Adjustments to Section 415 Limitations

If the Plan is determined to be a top-heavy plan and an Employer maintains a
defined benefit plan covering some or all of the Employees that are covered by
the Plan, the defined benefit plan fraction and the defined contribution plan
fraction, described in Article VII, shall be determined as provided in Section
415 of the Code by substituting "1.0" for "1.25" each place where "1.25"
appears, except that such substitutions shall not be applied to the Plan if (i)
the Plan is not a super top-heavy plan, (ii) the Employer Contribution for such
top-heavy Plan Year for each non-key employee who is to receive a minimum
top-heavy benefit hereunder is not less than four percent

                                       66
<PAGE>   67

of such non-key employee's compensation, and (iii) the minimum annual retirement
benefit accrued by a non-key employee who participates under one or more defined
benefit plans of an Employer or a Related Company for such top-heavy Plan Year
is not less than the lesser of three percent times years of service with an
Employer or a Related Company or thirty percent.

22.5 Accelerated Vesting

If the Plan is determined to be a top-heavy plan, a Participant's vested
interest in his Employer Contributions Sub-Account shall be 100 percent.

                                       67
<PAGE>   68

                                  ARTICLE XXIII
                                 EFFECTIVE DATE

23.1 Effective Date of Amendment and Restatement

This amendment and restatement is effective as of January 1, 1996.


     EXECUTED AT _______________________________________________, ____________,
this ____ day of __________.


                                   PROGRESS SOFTWARE CORPORATION


                                   By:  /s/ Norman R. Robertson
                                       -----------------------------------------
                                        Title: Vice President, Finance and
                                               Administration and Chief
                                               Financial Officer



                                       68
<PAGE>   69

                             FIRST AMENDMENT TO THE
                       JANUARY 1, 1996 RESTATEMENT OF THE
                    PROGRESS SOFTWARE CORPORATION 401(K) PLAN


     This First Amendment to the January 1, 1996 Restatement of the Progress
Software Corporation (401(k) Plan (the "Plan") is effective as of September 1,
1997

1.   The defined terms "Eligible Employee" and "Employee", as set forth in
     Section 1.1 of the Plan, are hereby deleted and replaced in their entirety
     by the following new definitions:

          An "Employee" means any employee of an Employer other than (i) a
          leased employee, (ii) an employee who is covered by a collective
          bargaining agreement that does not specifically provide for coverage
          under the Plan, or (iii) a non-resident alien who receives no earned
          income from an employer or related company which constitutes income
          from sources within the United States.

          An "Eligible Employee" means any Regular Employee who has met the
          eligibility requirements of Article III to have Tax-Deferred
          Contributions made to the Plan on his behalf.

2.   The following new definition is inserted at the end of Section 1.1 of the
     Plan:

     A "Regular Employee" means any Employee other than a cooperative student,
     intern or other employee hired on a temporary basis.


PROGRESS SOFTWARE CORPORATION



By:  /s/ Norman R. Robertson
    --------------------------------------------
    Norman R. Robertson
    Vice President and Chief Financial Officer

                                       69
<PAGE>   70

                             SECOND AMENDMENT TO THE
                       JANUARY 1, 1996 RESTATEMENT OF THE
                    PROGRESS SOFTWARE CORPORATION 401(K) PLAN


     This Second Amendment to the January 1, 1996 Restatement of the Progress
Software Corporation 401(k) Plan (the "Plan") is effective as of January 1,
1996.

1.   The defined term "Compensation", as set forth in Section 1.1 of the Plan,
is hereby deleted and replaced in its entirety by the following new definition:

          The "Compensation" of a Participant for any period means the wages as
          defined in Section 3401 (a) of the Code, determined without regard to
          any rules that limit compensation included in wages based on the
          nature or location of the employment or services performed, and
          excluding reimbursements or other expense allowances, fringe benefits,
          moving expenses, deferred compensation, and welfare benefits, but
          determined prior to any exclusions for amounts deferred under Section
          125, 402 (e) (3), 402 (h) (1) (B), 403(b) or 457 (b) of the Code or
          for certain contributions described in Section 414 (h) (2) of the Code
          that are picked up by the employing unit and treated as employer
          contributions.

          Notwithstanding the foregoing, Compensation shall not include the
          value of any non-qualified stock option granted to a Participant by
          his Employer to the extent such value is includible in the
          participant's taxable income.


PROGRESS SOFTWARE CORPORATION



By:  /s/ Norman R. Robertson
    --------------------------------------------
    Norman R. Robertson
    Vice President and Chief Financial Officer


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<PAGE>   71

                             THIRD AMENDMENT TO THE
                       JANUARY 1, 1996 RESTATEMENT OF THE
                    PROGRESS SOFTWARE CORPORATION 401(K) PLAN


     This Third Amendment to the January 1, 1996 Restatement of the Progress
Software Corporation 401(k) Plan (the "Plan") is effective as of September 1,
1997.

1.   The defined term "Eligible Employee", as set forth in Section 1.1 of the
Plan, is hereby deleted and replaced in its entirety by the following new
definition:

          "An `Eligible Employee' means any Regular Employee or Employee who has
     met the eligibility requirements of Article III to have Tax-Deferred
     Contributions made to the Plan on his behalf."

2.   Section 2.4 of the Plan is hereby deleted and replaced in its entirety by
the following:

          "There shall be no Eligibility Service required under the Plan for
     Regular Employees. With respect to an Employee who is not a Regular
     Employee, a year of Eligibility Service is required. A year of Eligibility
     Service shall mean a twelve-consecutive month period beginning on his
     employment commencement date (or his reemployment commencement date) in
     which he is credited with at least 1,000 Hours of Service."

3.   Section 3.1 is hereby amended by deleting the second sentence thereof and
substituting therefor the following:

          "Each other Employee who is a Regular Employee shall become an
     Eligible Employee as of the Enrollment date coinciding with or next
     following the date on which he becomes a Regular Employee. Each other
     Employee who is not a Regular Employee shall become an Eligible Employee as
     of the Enrollment Date coinciding with or next following his completion of
     a year of Eligibility Service."

     Executed this ____ day of __________, 199_ by a duly authorized officer of
Progress Software Corporation.


                                   PROGRESS SOFTWARE CORPORATION




                                   By:  /s/ Norman R. Robertson
                                       -----------------------------------------
                                       Title:  Vice President, Finance and
                                               Administration and Chief
                                               Chief Financial Officer


                                       71
<PAGE>   72

                             FOURTH AMENDMENT TO THE
                       JANUARY 1, 1996 RESTATEMENT OF THE
                    PROGRESS SOFTWARE CORPORATION 401(K) PLAN


     This Fourth Amendment to the January 1, 1996 Restatement of the Progress
Software Corporation 401(k) Plan (the "Plan") is effective as of December 1,
1998.

     Section 6.4 of the Plan is hereby amended by deleting the date, January 4,
as it appears in the ninth line of such Section and substituting therefor the
date, December 31.

     Executed this ____ day of December 1998, by a duly authorized officer of
Progress Software Corporation.


                                  PROGRESS SOFTWARE CORPORATION


                                  By:  /s/ Norman R. Robertson
                                      -----------------------------------------
                                      Norman R. Robertson
                                      Vice President and Chief Financial Officer


                                       72