<PAGE>   1

                                                                    EXHIBIT 10.3



                           WEATHERFORD ENTERRA, INC.
                             1987 STOCK OPTION PLAN
                AS AMENDED AND RESTATED THROUGH OCTOBER 5, 1995


         1.      PURPOSE.  This 1987 Stock Option Plan (the "Plan") of
Weatherford Enterra, Inc. (the "Company"), for executive officers and other key
employees (who may be members of the Board of Directors) of the Company and of
certain related corporations, and others providing services to the Company and
such related corporations (an "Optionee"), is intended to advance the best
interest of the Company and those related corporations by providing those
persons who have a substantial responsibility for its management and growth
with additional incentive and by increasing their proprietary interest in the
success of the Company and those related corporations--thereby encouraging them
to continue their employment or affiliation.

         2.      ADMINISTRATION.  The Plan shall be administered by a committee
to be appointed by the Board of Directors of the Company (hereinafter called
the "Committee"); and all questions of interpretation and application of the
Plan, or of options granted hereunder (hereinafter called the "Options") shall
be subject to the determination, which shall be final and binding, of the
Committee.  The Committee shall consist of not less than three members of the
Board of Directors, all of whom shall be "disinterested persons".  A
"disinterested person" is a person who at the time he exercises discretion with
respect to the grant of any Option is not, and for at least one year prior to
that time has not been, eligible to receive options under the Plan or under
other similar plans of the Company.  A majority of its members will constitute
a quorum.  All determinations of the Committee will be made by a majority of
its members.  Any decision or determination reduced to writing and signed by a
majority of the members will be as effective as if it had been made by a
majority vote at a meeting properly called and held.  The Plan shall be
administered in such a manner as to permit the Options granted hereunder which
are designated as such to qualify as "incentive stock options" ("Incentive
Options") as described in section 422A of the Internal Revenue Code of 1986, as
amended (the "Code").

         3.      (a)      SHARES AVAILABLE.  The stock subject to the Options
and other provisions of the Plan shall be shares of the Company's Common Stock,
$0.10 par value (the "Stock").  The total amount of the Stock with respect to
which Options may be granted shall not exceed in the aggregate 69,401 shares;
provided, that such aggregate number of shares shall be subject to adjustment
in accordance with the provisions of Paragraph 18 hereof.  Such shares may be
treasury shares or authorized but unissued shares.

                 (b)      MAXIMUM AWARD.  The maximum aggregate number of
shares of Stock available for Options to any one Optionee during any 12-month
period is 200,000.
<PAGE>   2

                 (c)      SHARE COUNTING.  For purposes of determining at any
time the number of shares that remain available for grant under this Plan, the
number of shares then authorized pursuant to Section 3 of the Plan shall be (i)
decreased by the "gross" number of shares issued pursuant to exercised Options,
(ii) decreased by the "gross" number of shares issuable pursuant to outstanding
unexercised Options, and (iii) increased by the difference between the "gross"
number of Shares and the "net" number of shares issued pursuant to exercised
Options.  As used herein, the "gross" number of shares refers to the maximum
number of shares that may be issued upon the exercise of an Option.  The "net"
number of shares refers to the net number of shares actually issued to an
Optionee upon exercise of an Option, after reducing the "gross" number of
shares by the number of shares tendered back to the Company in payment of the
Option Price (as defined hereinafter) for the satisfaction of any tax payment
obligation.  If an Optionee shall forfeit, voluntarily surrender or otherwise
permanently lose his or her right to exercise an Option under any provision of
this Plan or otherwise, or if any Option shall terminate or expire pursuant to
its terms, the shares subject to the Option shall once again be available to be
awarded and issued under this Plan pursuant to a new Option grant hereunder.

         4.      AUTHORITY TO GRANT OPTIONS.  The Committee may grant from time
to time to such eligible individuals as it shall from time to time determine an
Option, or Options, to buy a stated number of shares of Stock under the terms
and conditions of the Plan.  With respect to each Option, the Committee shall
specify whether such Option shall constitute an Incentive Option or an Option
not intended to qualify as an Incentive Option (a "Nonqualified Option").
Subject only to any applicable limitations set forth elsewhere in the Plan, the
number of shares of Stock to be covered by any Option shall be as determined by
the Committee.

         5.      ELIGIBILITY.  The individuals who shall be eligible to receive
Incentive Options shall be such executive officers and other key employees (who
may be members of the Board of Directors) of the Company, or of any parent or
subsidiary corporation, as the Committee shall determine from time to time.
With respect to Incentive Options, any reference to a parent or subsidiary
corporation shall mean a parent corporation within the meaning of section
425(e) of the Code or a subsidiary corporation within the meaning of section
425(f) of the Code.  The individuals who shall be eligible to receive
Nonqualified Options shall be such executive officers and other key employees
(who may be members of the Board of Directors) of the Company, or of any parent
or subsidiary corporation, or any other person performing services for the
Company or any parent or subsidiary corporation, as the Committee shall
determine from time to time.  With respect to Nonqualified Options, any
reference to a parent corporation shall mean a corporation which has actual
control of the Company through its direct or indirect ownership of not less
than 51 percent of each class of voting stock of the Company; and any reference
to a subsidiary corporation shall mean a corporation of which the Company owns,
directly or indirectly, not less than 40 percent of each class of voting stock.





                                      2
<PAGE>   3

         6.      OPTION PRICE.  The price at which shares may be purchased
pursuant to an Option (the "Option Price") shall be determined by the Committee
at the time each Option is granted but shall not be less than 100 percent of
the Fair Market Value (as defined hereinafter) of the shares of Stock on the
date the Option is granted.  In the case of any employee of the Company or a
parent or subsidiary corporation who owns stock possessing more than 10 percent
of the total combined voting power of all classes of stock  of the corporation
employing the employee or of its parent or subsidiary corporation, the price at
which shares may be so purchased under an Incentive Option shall be not less
than 110 percent of the Fair Market Value of the Stock on the date the
Incentive Option is granted.  "Fair Market Value" for purposes of this Plan
means the average of the high and low reported sales prices per share of Stock
(as reported on the New York Stock Exchange) as of the relevant measuring date,
or if there is no sale on the New York Stock Exchange on that date, then as of
the next following day on which there is a sale.

         7.      DURATION OF OPTIONS.  Each Option shall expire on the tenth
(10th) anniversary date of its grant.  In the case of any employee of the
Company who owns stock possessing more than 10 percent of  the total combined
voting power of all classes of stock of the corporation employing the employee
or of its parent or subsidiary corporation, no Incentive Option shall be
exercisable after the expiration of five years after the date such Incentive
Option is granted.  The Committee in its discretion may provide that an Option
shall be exercisable during such 10-year period or five-year period, as the
case may be, or during any lesser period of time.

         8.      MAXIMUM VALUE OF STOCK SUBJECT TO INCENTIVE OPTIONS.
Notwithstanding any other provisions of the Plan to the contrary, the aggregate
Fair Market Value (determined as of the date the Incentive Option is granted)
of the Stock with respect to which Incentive Options are exercisable for the
first time by the Optionee in any calendar year (under this Plan and any other
incentive stock option plan(s) of the Company and any parent and subsidiary
corporation) shall not exceed $100,000.

         9.      AMOUNT EXERCISABLE.  Each Option may be exercised, so long as
it is valid and outstanding, from time to time, in whole or in part, in such
manner and subject to such conditions, as the Committee in its discretion may
provide in the option agreement (described in Paragraph 22 hereof).

         10.     EXERCISE OF OPTIONS.

                 (a)      NOTICE.  Options shall be exercised by the delivery
of written notice (the "Exercise Notice") to the Secretary of the Company
setting forth the number of shares with respect to which the Option is to be
exercised and the address to which the certificates representing shares of the
Stock issuable upon the exercise of such Option shall be mailed (the "Exercise
Date").  The date on which the Exercise Notice is delivered to the Company is
the "Notice Date".





                                      3
<PAGE>   4
                 (b)      PAYMENT.  Unless otherwise prescribed by the 
Committee, the Optionee shall tender to the Company on, or within three
business days after, the Exercise Date full payment of the Option Price for the
shares of Stock, together with any federal, state or local taxes required to be
collected or withheld by the Company in connection with the exercise of the
Option ("Taxes"), in cash (by personal check, cashier's check, certified check,
bank draft or postal or express money order payable to the order of the Company
or by payroll deduction).  Alternatively, subject to the provisions of Rule
16b-3 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
payment of the Option Price and any Taxes may be made by the Optionee's
delivering to the Company the Exercise Notice together with irrevocable
instructions to a broker to promptly deliver to the Company an amount equal to
the Option Price of such shares of Stock and any Taxes, such amount being
either from loan proceeds or from the sale of the shares of Stock to be issued
to the Optionee.  Alternatively, unless otherwise provided in the option
agreement, payment of the Option Price and any Taxes may be made in whole or in
part in shares of Stock previously issued to the Optionee, if at the time of
delivery of the Exercise Notice (i) the Company has unrestricted earned surplus
in an amount not less than the Option Price of such shares, (ii) all accrued
cumulative preferential dividends and other current preferential dividends on
all outstanding preferred stock of the Company have been fully paid, (iii) the
reacquisition or exchange by the Company of its own shares for the purpose of
enabling such Optionee to exercise such Option is otherwise permitted by
applicable law and without any vote or consent of any shareholder of the
Company and would not result in the Company's being in violation of any
agreement by which it is bound, and (iv) there shall have been adopted, and
there is in full force and effect, a resolution of the Board of Directors of
the Company authorizing the reacquisition by the Company of its own shares for
such purpose.  If payment is made in whole or in part in shares of Stock, then
the Optionee shall deliver to the Company, in payment of the Option Price of
the shares with respect of which such Option is exercised, (i) certificates
registered in the name of such Optionee representing a number of shares of
Stock legally and beneficially owned by such Optionee, free of all liens,
claims, and encumbrances of every kind, and having a Fair Market Value on the
date of delivery of such notice that is not greater than the Option Price of
the shares with respect to which such Option  is to be exercised, such
certificates to be accompanied by stock powers duly endorsed in blank by the
record holder of the shares represented by such certificates, with the
signature of such record holder guaranteed by a national banking association,
and (ii) if the Option Price of the shares with respect to which such Option is
to be exercised exceeds the Fair Market Value of such certificates, payment of
the difference shall be made as provided above.  Notwithstanding the foregoing
provisions of this Paragraph 10, the Committee, in its sole discretion, may
refuse to accept shares of Stock in payment of the Option Price of the shares
with respect to which such Option is to be exercised and, in that event, any
certificates representing shares of Stock which were delivered to the Company
with such written notice shall be returned to such Optionee together with
notice by the Company to such Optionee of the refusal of the Committee to       
accept such shares of Stock.





                                      4
<PAGE>   5

                 (c)      STOCK PURCHASE AGREEMENT.  In its sole and absolute
discretion, the Committee may require, as an additional condition to the
issuance of Stock upon exercise of an Option, that the Optionee furnish the
Committee with an executed copy of a stock purchase agreement, in such form as
may be required by the Committee, at the time the Exercise Notice is delivered
to the Company or within three business days after the proposed agreement is
presented to the Optionee, if later.

                 (d)      SHARE CERTIFICATES.  As promptly as practicable after
the receipt by the Company of (i) the Exercise Notice from the Optionee setting
forth the number of shares with respect to which such Option is to be
exercised, (ii) payment of the Option Price of such shares in the form required
by the foregoing provisions of this Paragraph 10, and (iii) a fully executed
stock purchase agreement in the form required by the Committee, if any is so
required, the Company shall cause to be delivered to such Optionee (or to a
specified escrow agent, if so required under the terms of any applicable stock
purchase agreement) certificates representing the number of shares of Stock
with respect to which such Option has been so exercised, such certificates to
be registered in the name of such Optionee, provided that such delivery shall
be considered to have been made when such certificates shall have been mailed,
postage prepaid, to such Optionee at the address specified for such purpose in
the Exercise Notice from the Optionee to the Company.

                 (e)      VALUATION.  Any calculation with respect to an
Optionee's income, required tax withholding or otherwise shall be made using
the Fair Market Value of such shares of Stock on the Notice Date, whether or
not the Exercise Notice is delivered to the Company before or after the close
of trading on that date, unless otherwise specified by the Committee.

         11.  TRANSFERABILITY OF OPTIONS.  Options shall not be transferable by
the Optionee otherwise than by will or under the laws of descent and
distribution, and shall be exercisable, during his lifetime, only by the
Optionee.

         12.  TERMINATION OF EMPLOYMENT OR AFFILIATION OF OPTIONEE.  Except as
may be otherwise expressly provided in this Paragraph 12 or elsewhere in the
Plan, if the Optionee's employment with the Company is terminated, the Optionee
shall have the right to exercise the Option, to the extent to which he was
entitled to exercise such Option immediately prior to such termination, at any
time during the period ending the earlier of 30 days after such termination and
the expiration of the Option.  Whether authorized leave of absence, or absence
on military or government service, shall constitute severance of the employment
or affiliation relationship between the Company and the Optionee shall be
determined by the Committee at the time thereof.  In the event of the death of
the Optionee while affiliated with or in the employ of the Company, or within
three months after his retirement or termination due to age or disability as
provided below, such Option shall terminate on the earlier of one year
following the date of such death and the expiration of the Option.  After the
death of the Optionee, the time for exercise of the Option shall be 
accelerated and the Option shall be 





                                      5
<PAGE>   6
exercisable in full, and the Optionee's executors, administrators or any
persons to whom his Option may be transferred by will or by the laws of descent
and distribution, shall have the right, at any time prior to such termination,
to exercise the Option, in whole or in part, without regard to any limitations
set forth in or imposed pursuant to Paragraph 9 hereof.  If, before the date of
expiration of the Option, the Optionee shall be retired in good standing from
the employ of the Company, or the affiliation shall be severed for reasons of
age or disability under the then established rules of the Company, the Option
shall terminate on the earlier of three months after the date of such
retirement or severance and the expiration of the Option.  In the event of such
retirement or severance, the Optionee shall have the right prior to the
termination of such Option to exercise the Option to the extent to which he was
entitled to exercise such Option immediately prior to such retirement or
severance.  For the purpose of determining the employment relationship or other
affiliation between the Company and the Optionee, employment by or affiliation
with any parent or subsidiary corporation shall be considered employment by or
affiliation with the Company.
        
         13.  REQUIREMENTS OF LAW.  The Company shall not be required to sell
or issue any shares of Stock under any Option if the issuance of such shares
shall constitute or result in a violation by the Optionee or the Company of any
provision of any law, statute or regulation of any governmental authority.
Specifically in connection with the Securities Act of 1933, as now in effect or
hereafter amended (the "Securities Act"), upon exercise of any Option, the
Company shall not be required to issue such shares unless the Committee has
received evidence satisfactory to it to the effect that the Optionee will not
transfer such shares except pursuant to a registration statement in effect
under such Act or unless an opinion of counsel satisfactory to the Company has
been received by the Company to the effect that such registration is not
required.  Any determination in this connection by the Committee shall be
final, binding and conclusive.  The Company may, but shall in no event be
obligated to, register the shares of Stock covered hereby pursuant to the
Securities Act.  In the event the shares of Stock issuable on exercise of an
Option are not registered under the Securities Act, the Company may imprint the
following legend or any other legend which counsel for the Company considers
necessary or advisable to comply with the Securities Act:

                 "The shares of stock represented by this certificate have not
         been registered under the Securities Act of 1933 or under the
         securities laws of any State and may not be sold or transferred except
         upon such registration or upon receipt by the Corporation of an
         opinion of counsel satisfactory to the Corporation, in form and
         substance satisfactory to the Corporation, that registration is not
         required for such sale or transfer."

The Company shall not be obligated to take any other affirmative action in
order to cause the exercise of an Option or the issuance of shares pursuant
thereto to comply with any law or regulation of any governmental authority.




                                      6
<PAGE>   7

         14.     NO RIGHTS AS STOCKHOLDER.  No Optionee shall have rights as a
stockholder with respect to shares of Stock covered by his Option until the
date of issuance of a stock certificate for such shares; and, except as
otherwise provided in Paragraph 18 hereof, no adjustment for dividends, or
otherwise, shall be made if the record date therefor is prior to the date of
issuance of such certificate.

         15.     EMPLOYMENT OR AFFILIATION OBLIGATION.  The granting of an
Option shall not impose upon the Company or any parent or subsidiary
corporation any obligation to employ or become affiliated with, or continue to
employ or be affiliated with, any Optionee; and the right of the Company or any
parent or subsidiary corporation to terminate the employment or affiliation of
any person shall not be diminished or affected by reason of the fact that an
Option has been granted to him.

         16.     FORFEITURE FOR COMPETITION.  Notwithstanding any other
provision of the Plan, if at any time during the term of an Option granted
hereunder the Committee finds by a majority vote, after full consideration of
the facts presented on behalf of the Company and the Optionee, that such
Optionee, without the written consent of the Company, directly or indirectly
owns, operates, manages, controls or participates in the ownership, management,
operation or control of, or is employed by or is paid as a consultant or as an
independent contractor by a business which competes with the Company or any
parent or subsidiary corporation in the trade area served by the Company or any
parent or subsidiary corporation at any time during the term of the Option but
prior to its exercise in full and in which area the Optionee had performed
services for the Company or any parent or subsidiary corporation while employed
by it, the Optionee shall forfeit all unexercised Options and all exercised
Options under which the Company has not yet delivered the certificates and
which had been granted to the Optionee by the Committee earlier.  The preceding
provisions of this Paragraph 16 shall not be deemed to have been violated
solely by reason of the  Optionee's ownership of a stock or securities of any
publicly owned corporation, provided that such ownership does not result in
effective control of such corporation, and provided further that written notice
of such ownership, if in excess of one percent of the outstanding stock of said
corporation, is given to the Committee within 60 days after the later of (i)
the date on which the Optionee is notified of the award of an Option, or (ii)
the date on which such ownership is acquired.

         17.  FORFEITURE FOR DISHONESTY.  Notwithstanding anything to the
contrary in the Plan, if the Committee finds by a majority vote, after full
consideration of the facts presented on behalf of both the Company and the
Optionee, that the Optionee has been engaged in fraud, embezzlement, theft,
commission of a felony or proven dishonesty in the course of his employment by
or affiliation with the Company or any parent or subsidiary corporation which
damaged the Company or any parent or subsidiary corporation, or for disclosing
trade secrets of the Company or any parent or subsidiary corporation, the
Optionee shall forfeit all unexercised Options and all exercised Options under
which the Company has not yet delivered the certificates and which had been
granted the Optionee by the Committee earlier.  




                                      7
<PAGE>   8
The decision of the Committee as to the cause of an Optionee's discharge and
the damage done to the Company or any parent or subsidiary corporation shall be
final.  No decision of the Committee, however, shall affect the finality of the
discharge of such Optionee by the Company or any parent or subsidiary
corporation in any manner.

         18.     CHANGES IN THE COMPANY'S CAPITAL STRUCTURE.  The existence of
outstanding Options shall not affect in any way the right or power of the
Company or its stockholders to make or authorize all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or
any issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Stock or the rights thereof, or the dissolution or liquidation of
the Company, or any sale or transfer of all or any part of its assets or
business, or any other corporate act or proceeding, whether of a similar
character or otherwise.

                 If the Company shall effect a subdivision or consolidation of
shares or other capital readjustment, the payment of a stock dividend, or other
increase or reduction of the number of shares of Stock outstanding, without
receiving compensation therefor in money, services or property, then (a) the
number, class and per share price of shares of Stock subject to outstanding
Options hereunder shall be appropriately adjusted in such a manner as to
entitle an Optionee to receive upon exercise of an Option, for the same
aggregate cash consideration, the same total number and class of shares as he
would have received had he exercised his Option in full immediately prior to
the event requiring the adjustment; and (b) the number and class of shares then
reserved for issuance under the Plan shall be adjusted by substituting for the
total number and class of shares of Stock then reserved that number and class
of shares of stock that would have been received by the owner of an equal
number of outstanding shares of each class of stock as the result of the event
requiring the adjustment; provided in each case that with respect to Incentive
Stock Options and Nonqualified Options intended to be qualified as
performance-based compensation under Section 162(m)(4)(C) of the Code, no
adjustment shall be authorized to the extent that the adjustment would cause
the Plan to violate Section 422(b)(1) of the Code or would cause any part of
such Option to fail to qualify under Section 162(m) of the Code, as the case
may be, or any successor provisions thereto, and provided further, that the
number of shares of Stock subject to any Option shall always be a whole number.

                 After a merger of one or more corporations into the Company or
after a consolidation of the Company and one or more corporations in which the
Company shall be the surviving corporation, without regard to any limitations
set forth or imposed pursuant to Paragraph 9 hereof, each holder of an
outstanding Option shall, at no additional cost, be entitled upon exercise of
such Option to receive (subject to any required action by stockholders) in lieu
of the number and class of shares as to which such Option shall then be so
exercisable, the number and class of shares of stock or other securities to
which such Optionee would have been entitled pursuant to the terms of the
agreement of merger or consolidation if, immediately prior to such merger or
consolidation, such Optionee had been 




                                      8
<PAGE>   9

the holder of record of the number and class of shares of Stock equal to the
number and class of shares as to which  such Option shall be so exercised.

                 Notwithstanding any other provision of this Paragraph 18, if
(i) the Company merges or consolidates with any other corporation (other than a
wholly owned subsidiary) and is not the surviving corporation (or survives only
as a subsidiary of another corporation), (ii) the Company sells all or
substantially all of its assets to any other person or entity (other than a
wholly owned subsidiary), (iii) the Company is dissolved or liquidated, or (iv)
there is a Change of Control (as hereinafter defined) of the Company that is
not approved, recommended or supported by the Board of Directors of the Company
in actions taken prior to, and with respect to, such Change of Control, the
Optionee shall have the right, within 30 days after the approval by the
stockholders of the Company of such merger or consolidation, sale of assets or
dissolution or the occurrence of such Change of Control, to elect to surrender
all or part of such Options outstanding, irrespective of whether such Options
are then exercisable, in exchange for a cash payment by the Company in an
amount equal to the number of shares of Stock subject to the Option held by
such Optionee multiplied by the difference between the Change of Control Price
(as defined below) and the Option Price of a particular Option; provided,
however, that if the occurrence of an event specified herein is within six
months after the date of grant of a particular Option held by an Optionee who
is subject to Section 16(b) of the Exchange Act, any cash payment to the
Optionee shall be made on the day which is six months and one day after the
date of grant of such Option.  Notwithstanding the foregoing, if any right
granted pursuant to the foregoing would make any of the occurrences specified
above ineligible for pooling of interests accounting treatment under APB No. 16
that but for this provision would otherwise be eligible for such accounting
treatment, the Optionee shall receive shares of Stock with a Fair Market Value
equal to the cash that would otherwise be payable hereunder in substitution for
the cash.  If an Optionee does not elect to surrender all outstanding Options
for a cash payment (or shares of Stock) as provided above, such Options, or
replacement or substitution Options to be issued by the surviving or acquiring
corporation, shall become fully exercisable, to the extent they are not, and
shall remain exercisable for three months after the Optionee's termination of
employment or until the stated expiration of the term of the Option, whichever
is shorter. In the event that the consideration offered to stockholders of the
Company in any transaction described in this paragraph consists of anything
other than cash, the Committee shall determine the fair cash equivalent of the
portion of the consideration offered which is other than cash.

                 For purpose of this Plan, "Change of Control" means:  a)  any
individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Exchange Act) (a "Person") acquires of beneficial ownership of 20
percent or more of either (i) the then outstanding shares of Stock or (ii) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors; provided, however,
that for purposes of this subsection (a), a Person shall not include the
Company or any subsidiary or any employee benefit plan (or related trust)
sponsored or maintained by 




                                      9
<PAGE>   10

the Company or any subsidiary; or b) as a result of, or in connection with, a
contested election for directors, the persons who were directors of the Company
before such election shall cease to constitute a majority of the Board of
Directors of the Company.  The Committee shall determine whether a Change of
Control has occurred within the herein meaning and shall determine whether any
such Change of Control has been approved, recommended or supported by the Board
of Directors of the Company, and its determination shall be final and
conclusive.

                 For purposes of this Plan, "Change of Control Price" means the
higher of (i) the highest reported sales price of a share of Stock in any
transaction reported on the New York Stock Exchange during the 60-day period
prior to and including the date of the approval by the stockholders of the
Company of such merger, sale of assets or dissolution or the occurrence of the
Change of Control and (ii) if the Change of Control is the result of a tender
or exchange offer, the highest price per share of Stock paid in such tender or
exchange offer; provided, however, that in the case of an Option which is held
by an Optionee who is subject to Section 16(b) of the Exchange Act and was
granted within six months of the occurrence of an event specified herein, then
the Change of Control Price for such Option shall be the Fair Market Value of
the Stock on the date such Option is cancelled.

                 Except as hereinbefore expressly provided, the issue by the
Company of shares of any class, for cash or property, or for labor or services,
either upon direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number, class
or price of shares of Stock then subject to outstanding Options.

         19.     SUBSTITUTION OPTIONS.  Options may be granted under this Plan
from time to time in substitution for stock options held by employees of other
corporations who are about to become employees of or affiliated with the
Company or any parent or subsidiary corporation as the result of a merger or
consolidation of the employing corporation with the Company or any parent or
subsidiary corporation, or the acquisition by the Company or any parent or
subsidiary corporation of the assets of the employing corporation, or the
acquisition by the Company or any parent or subsidiary corporation of stock of
the employing corporation as the result of which it becomes a subsidiary of the
Company.  The terms and conditions of the substitute Options so granted may
vary from the terms and conditions set forth in this Plan to such extent as the
Board of Directors of the Company at the time of grant may deem appropriate to
conform, in whole or in part, to the provisions of the stock options in
substitution for which they are granted.

         20.     AMENDMENT OR TERMINATION OF PLAN.  The Board of Directors may
modify, revise or terminate this Plan at any time and from time to time;
provided, however, that without the further approval of the holders of at least
a majority of the outstanding shares of Stock, the Board of Directors may not
(i) materially increase the benefits accruing to 




                                     10
<PAGE>   11

participants under the Plan; (ii) change the aggregate number of shares of
Stock which may be issued under Options pursuant to the provisions of the Plan;
(iii) reduce the Option Price at which Options may be granted to an amount less
than the Fair Market Value per share at the time the Option is granted; or (iv)
change the class of employees eligible to receive Options; provided, however,
that the Board shall have the power to make such changes in the Plan and in the
regulations and administrative provisions hereunder or in any outstanding
Incentive Option as in the opinion of counsel for the Company may be necessary
or appropriate from time to time to enable any Incentive Option granted
pursuant to the Plan to qualify as an incentive stock option or such other
stock option as may be  defined under the Code so as to receive preferential 
federal income tax treatment.

         21.     INTENTIONALLY OMITTED.

         22.     WRITTEN AGREEMENT.  Each Option granted hereunder shall be
embodied in a written option agreement, which shall be subject to the terms and
conditions prescribed above and shall be signed by the Optionee and by an
authorized officer of the Company for and in the name and on behalf of the
Company.  Such an option agreement shall contain such other provisions as the
Committee in its discretion shall deem advisable.

         23.     INDEMNIFICATION OF THE COMMITTEE AND THE BOARD OF DIRECTORS.
With respect to administration of the Plan, the Company shall indemnify each
present and future member of the Committee and the Board of Directors against,
and each member of the Committee and the Board of Directors shall be entitled
without further act on his part to indemnity from the Company for, all expenses
(including the amount of judgments and the amount of approved settlements made
with a view to the curtailment of costs of litigation, other than amounts paid
to the Company itself) reasonably incurred by him in connection with or arising
out of any action, suit or proceeding in which he may be involved by reason of
his being or having been a member of the  Committee and the Board of Directors,
whether or not he continues to be such member of the Committee and the Board of
Directors at the time of incurring such expenses; provided, however, that such
indemnity shall not include any expenses incurred by any such member of the
Committee and the Board of Directors (i) in respect of matters as to which he
shall be finally adjudged in any such action, suit or proceeding to have been
guilty of gross negligence or willful misconduct in the performance of his duty
as such member of the Committee and the Board of Directors, or (ii) in respect
of any matter in which any settlement is effected, to an amount in excess of
the amount approved by the Company on the advice of its legal counsel; and
provided further, that no right of indemnification under the provisions set
forth herein shall be available to or enforceable by any such member of the
Committee and the Board of Directors unless, within 60 days after institution
of any such action, suit or proceeding, he shall have offered the Company, in
writing, the opportunity to handle and defend same at its own expense.  The
foregoing right of indemnification shall inure to the benefit of the heirs,
executors or administrators of each such member of the Committee and the Board
of Directors and shall be in addition to all 




                                     11
<PAGE>   12

other rights to which such member of the Committee and the Board of Directors
may be entitled as a matter of law, contract or otherwise.

         24.     EFFECT OF AMENDMENTS.  This 1987 Stock Option Plan, as amended
through October 5, 1995, constitutes a complete amendment and restatement of
such Plan.  Any Option granted under the Plan shall be subject to the terms of
the Plan as in effect at the time the Option is granted; provided, however,
that by agreement between the Committee and the Optionee, any such Option may
be amended to incorporate and become subject to the provisions of the Plan as
amended through a date which is subsequent to the date on which the Option was
granted.

         25.     EFFECTIVE DATE OF PLAN.  The Plan became effective March 18,
1987.  No Option shall be granted pursuant to this Plan after March 17, 1997.





                                     12