ex10_1.htm


    
      

    

    Exhibit
10.1

    


    KBR,
INC. 2009 EMPLOYEE STOCK PURCHASE PLAN

    


    


    1.         
  PLAN.  The purpose
of the KBR, INC. 2009 EMPLOYEE STOCK PURCHASE PLAN
(the
“Plan”) is
to furnish to eligible employees an incentive to advance the best interests
of KBR, INC. (the “Company”) by
providing a method whereby they voluntarily may purchase stock of the Company at
a favorable price and upon favorable terms.  The Plan is intended to
qualify as an “employee stock purchase plan” under Section 423 of the U.S.
Internal Revenue Code of 1986, as amended (the “Code”),
although the Company makes no undertaking nor representation to maintain such
qualification.  The provisions of the Plan shall be construed in a
manner consistent with the requirements of that section of the
Code.

    


    2.   
        ADMINISTRATION OF THE
PLAN.  The Plan shall be administered by the Compensation
Committee (the “Committee”)
of the Board of Directors of the Company (the “Board”).  Subject
to the provisions of the Plan, the Committee shall interpret the Plan and all
options granted under the Plan, shall make such rules as it deems necessary for
the proper administration of the Plan, shall make all other determinations
necessary or advisable for the administration of the Plan, and shall correct any
defect or supply any omission or reconcile any inconsistency in the Plan or
in any option granted under the Plan in the manner and to the extent that the
Committee deems desirable to carry the Plan or any option into
effect.  The Committee may adopt rules or procedures relating to the
operation and administration of the Plan to accommodate the specific
requirements of local laws and procedures.  Without limiting the
generality of the foregoing, the Committee specifically is authorized to adopt
rules or procedures regarding the handling of payroll deductions, payment of
interest, conversion of local currency, payroll tax, withholding procedures,
participation limits and handling of stock certificates which vary with local
requirements.  Any action taken or determination made by the Committee
pursuant to this and the other paragraphs of the Plan shall be conclusive on all
parties.  The act or determination of a majority of the Committee
shall be deemed to be the act or determination of the Committee.  The
Committee shall not be liable for any decision, determination, or action taken
in good faith in connection with the administration of the Plan.  The
Committee shall have the authority to delegate administration of the Plan to
such officers and employees of the Company as the Committee deems appropriate,
and such persons shall not be liable for any decision, determination, or action
taken in good faith in connection with such delegated
administration.

    


    3.        
    ELIGIBILITY.  All
employees of the Company and those of any present or future subsidiary
corporations of the Company designated by the Company shall be eligible to
participate in the Plan; provided, however, no option shall be granted to an
employee if such employee, immediately after the option is granted, owns stock
possessing five percent or more of the total combined voting power or value of
all classes of stock of the Company or of its parent or subsidiary corporation
(within the meaning of Sections 423(b)(3) and 424(d) of the Code).
Notwithstanding the foregoing, the Committee may at any time and from time to
time, in its sole discretion, designate a subsidiary corporation of the Company
as an entity whose employees shall not be eligible to participate in the
Plan.


    
      
         


      

      
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    4.         
   STOCK
SUBJECT TO THE PLAN.  Subject to the provisions of paragraph 11
(relating to adjustment upon changes in stock), the aggregate number of shares
which may be sold pursuant to options granted under the Plan shall not exceed
5,000,000 shares of the authorized $.001 par value common stock of the Company
(“Stock”),
which shares may be unissued shares or reacquired shares or shares bought on the
market for purposes of the Plan.  Should any option granted under the
Plan expire or terminate prior to its exercise in full, the shares theretofore
subject to such option may again be subject to an option granted under the
Plan.  Any shares which are not subject to outstanding options upon
the termination of the Plan shall cease to be subject to the Plan.

    


    5.            
GRANT OF OPTIONS.

    


    (a)    
 GENERAL STATEMENT; “DATE OF GRANT;” “OPTION PERIOD;” “DATE OF
EXERCISE.”  Following the effective date of the Plan and
continuing while the Plan remains in force, the Company will offer options under
the Plan to all eligible employees to purchase shares of Stock.  These
options shall be granted twice each year on a date to be determined by the
Committee (each of which dates is hereinafter referred to as a “Date of
Grant”).  The term of each option is 6 months (each of which 6
month periods is hereinafter referred to as an “Option
Period”), which shall begin on a Date of Grant (the last day of each
Option Period is hereinafter referred to as a “Date of
Exercise”).  Subject to subparagraph 5(e), the number of shares
of Stock subject to an option for a participant shall be equal to the quotient
of (i) the aggregate payroll deductions (or, if payroll deductions are not
permitted under local law, other means of contributions specified by the
Committee) withheld on behalf of such participant in accordance with
subparagraph 5(b) (including any participant contributions made in accordance
with subparagraph 5(f)) during the Option Period, divided by (ii) the
“Option Price” (defined below) of the Stock applicable to the Option Period;
provided however, that the maximum number of shares of Stock that may be subject
to any option offered under such Option Period for a participant may not exceed
10,000 (subject to adjustment in the same manner as provided in paragraph 11
with respect to the number of shares subject to the Plan and the number and
Option Price of shares subject to options outstanding under the Plan).
Notwithstanding the foregoing, if, as of any date that the Plan is in effect,
there are not sufficient shares of Stock available under the Plan to allow for
the grant to each participant of an option covering the number of shares
determined in accordance with the preceding sentence, each participant shall be
granted an option under the Plan for his or her pro-rata share of the total
number of shares of Stock then available under the Plan.

    


    (b)    
 ELECTION TO PARTICIPATE; PAYROLL DEDUCTION
AUTHORIZATION.  Except as provided in subparagraph 5(f), an
eligible employee may participate in the Plan only by means of payroll
deduction, unless payroll deductions are not permitted under local laws, in
which case an eligible employee may contribute by such other means as specified
by the Committee.  Each eligible employee who elects to participate in
the Plan shall deliver to the Company a payroll deduction or contribution
authorization form within the time period and in a manner prescribed by the
Committee (which may be in electronic or telephonic form) whereby he gives
notice of his election to participate in the Plan as of the next following Date
of Grant, and whereby he designates an integral whole percentage of his
“Eligible Compensation” (as defined in subparagraph 5(d)) to be deducted from
his compensation on each pay day and paid into the Plan for his account. The
designated percentage may not be less than 1%, may not result in the payment
into the Plan of less than $5.00 each pay day, and may not exceed either of the
following: (i) 10% of the amount of Eligible Compensation from which the
deduction is made; or (ii) an amount which will result in noncompliance
with the $25,000 limitation stated in subparagraph 5(e).


    
      
         


      

      
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    (c)     
CHANGES IN PAYROLL
AUTHORIZATION. All payroll deductions or contributions made for a
participant shall be credited to his account under the Plan.  A participant
may discontinue his participation in the Plan as provided in paragraph 7 hereof,
or may decrease the rate of his payroll deductions or contributions during the
Option Period by completing or filing with the Company, at a time and in a
manner prescribed by the Committee, a new payroll deduction or contribution
authorization form authorizing a decrease in his payroll or contribution rate.
 The Committee may, in its discretion, limit the number of payroll or
contribution rate decreases during any Option Period.  The decrease in rate
shall be effective as soon as administratively practicable after the Company’s
receipt of the new payroll deduction or contribution authorization form.  A
participant’s payroll deduction or contribution authorization form shall remain
in effect for successive Option Periods unless terminated as provided in
paragraph 7 hereof.

    


    (d)    
 “ELIGIBLE COMPENSATION” DEFINED.  The
term
“Eligible
Compensation” means regular rate of pay on the Date of
Grant.  “Eligible Compensation” does not include short or long-term
incentive plan payments, bonuses, overtime, or other special payments, fees, or
allowances, except for special payments required by local law and treated as an
integral, recurring part of compensation. The Committee shall have the
discretion to determine what constitutes Eligible Compensation for participants
outside the United States in a manner designed to be consistent with the
foregoing definition.

    


    (e)     
$25,000
LIMITATION.  No employee shall be granted an option under the
Plan to the extent the grant of an option under the Plan would permit his rights
to purchase Stock under the Plan and under all other employee stock purchase
plans of the Company and its parent and subsidiary corporations to accrue at a
rate which exceeds $25,000 of fair market value of Stock (determined at the time
the option is granted) for each calendar year in which any such option granted
to such employee is outstanding at any time (within the meaning of
Section 423(b)(8) of the Code). Any payroll deductions or contributions (or
participant contributions made under subparagraph 5(f)) in excess of the amount
specified in the foregoing sentence shall be returned to the participant as soon
as administratively feasible after the next following Date of
Exercise.

    


    (f)      
LEAVES OF
ABSENCE.  During a paid leave of absence approved by the
Company and meeting the requirements of U.S. Treasury Regulation
Section 1.421-1(h)(2), a participant’s elected payroll deductions shall
continue.  If a participant takes an unpaid leave of absence that is
approved by the Company and meets the requirements of Treasury Regulation
Section 1.421-1(h)(2), then such participant may contribute amounts to the
Plan in lieu of his elected payroll deductions or contributions in accordance
with procedures established by the Committee; provided, however, that a
participant’s contributions while on such an unpaid leave of absence may not
exceed the total amount of payroll deductions that
would have been made had such participant not taken such an unpaid leave of
absence. If a participant takes a leave of absence that is not described in the
preceding sentences of this subparagraph 5(f), then he shall be considered to
have terminated his employment for purposes of the Plan, unless otherwise
required under local laws.  Further, notwithstanding the preceding
provisions of this subparagraph 5(f), if a participant takes a leave of absence
that is described in the first or second sentence of this subparagraph 5(f) and
such leave of absence exceeds the Maximum Period, then he shall be considered to
have terminated his employment for purposes of the Plan on the day immediately
following the last day of the Maximum Period.  For purposes of the
preceding sentence, the term “Maximum
Period” shall mean, with respect to a participant, the three-month period
beginning on the first day of the participant’s leave of absence; provided,
however, that if the participant’s right to reemployment by the Company (or a
parent or subsidiary corporation of the Company) is guaranteed either by statute
or contract, then such three-month period shall be extended until the last day
upon which such reemployment rights are so guaranteed.


    
      
         


      

      
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    (g)     
CONTINUING
ELECTION.  Subject to the limitation set forth in subparagraph
5(e), a participant (i) who has elected to participate in the Plan pursuant
to subparagraph 5(b) as of a Date of Grant and (ii) who takes no action to
change or revoke such election as of the next following Date of Grant and/or as
of any subsequent Date of Grant prior to any such respective Date of Grant shall
be deemed to have made the same election, including the same attendant payroll
deduction or contribution authorization (or participant contribution agreement
under subparagraph 5(f) if applicable), for such next following and/or
subsequent Date(s) of Grant as was in effect immediately prior to such
respective Date of Grant. If a participant’s payroll deductions or
contributions, as applicable, are limited by subparagraph 5(e) for the Option
Period beginning in any calendar year, then, subject to the limitation set forth
in subparagraph 5(e), such payroll deductions or contributions shall recommence
at the rate provided in such participant’s payroll deduction or contribution
authorization or contribution agreement, as applicable, for the next Option
Period unless the participant decreases the amount of his payroll deduction or
contribution authorization or contribution agreement pursuant to paragraph 5,
withdraws from the Plan as provided in paragraph 7, or is terminated from
participation in the Plan as provided in paragraph 8.

    


    (h)      TAX WITHHOLDING.  At
the time an option under the Plan is exercised, in whole or in part, or at the
time some or all of the Stock issued under the Plan is disposed of, the
participant must make adequate provision for the Company’s federal, state, or
other tax withholding obligations, if any, that arise upon the exercise of the
option or the disposition of the Stock.  At any time, the Company may
withhold from the participant’s compensation the amount necessary for the
Company to meet applicable withholding obligations, including without limitation
any withholding required to make available to the Company any tax deductions or
benefits attributable to the sale or disposition of Stock purchased by the
participant under the Plan.

    


    (i)     
 FRACTIONAL STOCK. The Company shall issue
or transfer fractional Stock under the Plan.  In the event that the
amount of salary reduction contributions of any participant is not exactly equal
to the purchase price for a whole number of shares of Stock, then any excess
amount shall be used to purchase fractional Stock.


    
      
         


      

      
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    6.            
EXERCISE OF OPTIONS.

    


    (a)      GENERAL
STATEMENT.  Subject to the limitation set forth in subparagraph
5(e), each participant in the Plan automatically and without any act on his part
will be deemed to have exercised his option on each Date of
Exercise.  Notwithstanding any provision of the Plan to the contrary,
prior to the commencement of any Option Period, the Committee in its discretion
may establish a minimum exercise price for such Option Period to the effect that
if the Option Price for such Option Period is less than such minimum exercise
price, then each participant shall be deemed to have withdrawn from the Plan
pursuant to paragraph 7 immediately prior to the Date of Exercise of such
offering period; provided, however, that a participant’s payroll deduction or
contribution authorization (or participant contribution agreement under
subparagraph 5(f), if applicable) shall not be terminated with respect to the
Date of Grant of any subsequent Option Period by reason of any such deemed
withdrawal. Any such minimum exercise price shall be subject to adjustment in
the same manner as provided in paragraph 11 with
respect to the number of shares subject to the Plan and the number and Option
Price of shares subject to options outstanding under the Plan.

    


    (b)      “OPTION PRICE” DEFINED.  The “Option
Price” per share of Stock to be paid by each optionee on each exercise of
his option shall be a sum equal to 95% of the fair market value of the Stock on
the Date of Exercise.  The fair market value of the Stock on the Date
of Exercise shall be the per share closing price of such Stock reported on the
New York Stock Exchange composite tape for such date (or if such exchange is
closed on that date, the first immediately preceding trading
date).  If the Stock is traded over the counter at the time a
determination of its fair market value is required to be made hereunder, its
fair market value shall be deemed to be equal to the closing price of Stock on
the most recent date on which Stock was publicly traded.  In the event
Stock is not publicly traded at the time a determination of its value is
required to be made hereunder, the determination of its fair market value shall
be made by the Committee in such manner as it deems appropriate.

    


    (c)      
DELIVERY OF
SHARES.  Except as provided below, the Company shall deliver to
each participant a certificate issued in his name for the number of shares of
Stock with respect to which such participant’s option was exercised and for
which such participant has paid the Option Price.  The certificate
shall be delivered as soon as practicable following the Date of
Exercise.

    


    In lieu
of delivering share certificates directly to participants, the Company in its
discretion may take such steps as it deems necessary or advisable (including,
without limitation, the execution of service agreements and contracts) to effect
the delivery of shares to a broker-dealer or similar custodian designated by the
Company (the “Plan
Broker”) on such terms and conditions as the Company determines in its
discretion.  In such event, as soon as practicable following the Date
of Exercise, the Company, on behalf of each participant, shall deliver to the
Plan Broker a certificate for (or shall otherwise cause to be credited with the
Plan Broker) the number of shares of Stock with respect to which such
participant’s option was exercised and for which such participant has paid the
Option Price.  The Plan Broker shall keep accurate records of the
beneficial interests of each participant in such shares by means of the
establishment and maintenance of an account for each
participant.  Fees and expenses of the Plan Broker shall be paid by
the Company and/or allocated among the respective participants in such manner as
the Company determines in its discretion.  During any period that the
Plan Broker arrangement described above is utilized in connection with the Plan,
participants shall be required, at such time or times as may be designated by
the Company, to enter into such agreements and authorizations (the terms of
which may include, without limitation, restrictions on the transfer of shares
from participants’ Plan Broker accounts) with the Plan Broker and the Company as
the Company may prescribe.


    
      
         


      

      
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    In the
event the Company is required to obtain from any commission or agency authority
to issue any shares as provided above, the Company will seek to obtain such
authority.  Inability of the Company to obtain from any such
commission or agency authority which counsel for the Company deems necessary for
the lawful issuance of any such shares shall relieve the Company from liability
to any participant in the Plan except to return to him the amount of the
balance in his account.

    


    7.            
WITHDRAWAL FROM THE PLAN.

    


    (a)      
WITHDRAWAL.  Any participant
may withdraw in whole from the Plan at any time prior to 45 days before the Date
of Exercise relating to a particular Option Period.  Partial
withdrawals shall not be permitted.  A participant who wishes to
withdraw from the Plan must deliver to the Company a notice of withdrawal in a
form prepared by the Company (which may be in electronic or telephonic
form).  The Company, promptly following the time when the notice of
withdrawal is delivered, will refund to the participant the amount of the
balance in his account under the Plan; and thereupon, automatically and without
any further act on his part, his payroll deduction or contribution authorization
or participant contribution agreement (as applicable), his interest in the Plan,
and his option under the Plan shall terminate.

    


    (b)       ELIGIBILITY FOLLOWING
WITHDRAWAL.  A participant who withdraws from the Plan shall be
eligible to participate again in the Plan upon expiration of the Option Period
during which he withdrew (provided that he is otherwise eligible to
participate in the Plan at such time).

    


    8.            
TERMINATION OF EMPLOYMENT.

    


    (a)      TERMINATION OF EMPLOYMENT OTHER THAN BY RETIREMENT,
DEATH OR DISABILITY.  If the employment of a participant
terminates prior to the Date of Exercise relating to a particular Option Period,
other than by retirement, death, or disability as provided in subparagraph 8(b)
below, his participation in the Plan automatically and without any act on his
part shall terminate as of the date of the termination of his employment;
provided, however, that if the Date of Exercise for the Option Period during
which such termination of employment occurs is not a Business Day and the
participant’s employment terminates on the last Business Day of the Option
Period, then such participant will be considered to have terminated employment,
for purposes of this subparagraph 8(a), on the Date of Exercise. For purposes of
the preceding sentence, the term “Business
Day” shall mean any day except a Saturday, Sunday or other day on which
national banking associations in the State of New York are generally closed for
the conduct of commercial banking business.  Following the
participant’s termination of employment as described above, the Company promptly
will refund to him the amount of the balance in his account under the Plan, and
thereupon his interest in the Plan and in any option under the Plan shall
terminate.  For purposes of this paragraph, an employee will not be
deemed to have terminated employment or failed to remain in the continuous
employ of the Company or any of its subsidiaries in the case of transfer between
or amongst the Company and any subsidiary that remains a subsidiary of the
Company which is participating in the Plan.


    
      
         


      

      
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    (b)     
TERMINATION OF
EMPLOYMENT BY RETIREMENT, DEATH OR DISABILITY.  If the
employment of a participant terminates by reason of such participant’s
retirement (which shall mean a termination of employment for any reason other
than cause (as defined below) after such participant has attained age 55)
or due to such participant’s death or permanent and total disability (within the
meaning of Section 22(e)(3) of the Code), then such participant, or such
participant’s personal representative in the event of the participant’s death,
and to the extent permitted by local law, shall have the right to elect either
to:

    


    (1)
withdraw the amount of the balance in the participant’s account under the Plan
at the date of such participant’s termination of employment; or

    


    (2)
exercise such participant’s option for the purchase of Stock on the last day of
the Option Period during which termination of employment occurs for the purchase
of the number of full shares of Stock which the amount of the balance in the
participant’s account under the Plan at the date of such participant’s
termination of employment will purchase at the applicable Option Price (subject
to subparagraph 5(e)), with any balance remaining in the participant’s account
under the Plan to be returned to such participant or such personal
representative.

    


    The
participant or, if applicable, such personal representative, must make such
election by giving notice to the Company at such time and in such manner as the
Committee prescribes.  In the event that no such notice of election is
timely received by the Company, the participant or personal representative will
automatically be deemed to have elected as set forth in clause (1) above,
and the balance in such participant’s account under the Plan shall be promptly
distributed to the participant or such personal representative.  For
purposes of this subparagraph 8(b), “cause” shall
mean a termination of a participant’s employment because he is discharged for
(A) fraud, theft, or embezzlement committed against the Company or a
subsidiary, affiliated entity, or customer of the Company, (B) such
participant’s willful misconduct in performance of the duties of his employment,
or (C) such participant’s final conviction of a felony.

    


    9.            
RESTRICTION UPON
ASSIGNMENT.  An option granted under the Plan shall not be
transferable otherwise than by will or the laws of descent and
distribution.  Each option shall be exercisable, during his lifetime,
only by the employee to whom granted.  The Company will not recognize
and shall be under no duty to recognize any assignment or purported assignment
by an employee of his option or of any rights under his option or under the
Plan.


    
      
         


      

      
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    10.          RIGHTS OF
STOCKHOLDER.  With respect to shares of Stock subject to an
option, an optionee shall not be deemed to be a stockholder, and he shall not
have any of the rights or privileges of a stockholder.  An optionee
shall have the rights and privileges of a stockholder when, but not until,
shares have been issued to him or on his behalf, as applicable, following
exercise of his option.

    


    11.          CHANGES IN STOCK;
ADJUSTMENT.  Whenever any change is made in the Stock, by
reason of a stock dividend or by reason of subdivision, stock split, reverse
stock split, recapitalization, reorganization, combination, reclassification of
shares or other similar change, appropriate action will be taken by the Board to
adjust accordingly the number of shares subject to the Plan, the maximum number
of shares that may be subject to any option, the number and Option Price of
shares subject to options outstanding under the Plan, and the minimum Option
Price, if any, established pursuant to subparagraph 6(a) with respect to
outstanding options.

    


    If the
Company shall not be the surviving corporation in any merger or consolidation
(or survives only as a subsidiary of another entity, or if the Company is to be
dissolved or liquidated, then unless a surviving corporation assumes or
substitutes new options (within the meaning of Section 424(a) of the Code)
for all options then outstanding, (i) the Date of Exercise for all options
then outstanding shall be accelerated to dates fixed by the Board prior to the
effective date of such merger or consolidation or such dissolution or
liquidation, (ii) an employee (or his legal representative) may make a
lump-sum deposit prior to the Date of Exercise in lieu of the remaining payroll
deductions (or remaining participant contributions under subparagraph 5(f))
which otherwise would have been made, and (iii) upon such effective date
any unexercised options shall expire.

    


    12.         
USE OF FUNDS; NO INTEREST
PAID.  All funds received or held by the Company under the Plan
will be included in the general funds of the Company free of any trust or other
restriction and may be used for any corporate purpose, except as may be required
by applicable local law.  No interest will be paid to any participant
or credited to his account under the Plan, except as may be required by
applicable local law.

    


    13.          TERM OF THE
PLAN.  The Plan shall be effective on January 1, 2009, or upon
the date of its adoption by the Board, if later, provided the Plan is approved
by the stockholders of the Company within twelve months before or after the date
the Plan is adopted.  Notwithstanding any provision in the Plan, no
option granted under the Plan shall be exercisable prior to such stockholder
approval, and, if the stockholders of the Company do not approve the Plan by the
Date of Exercise of the first option granted hereunder, then the Plan shall
automatically terminate, no options may be exercised hereunder, and the Company
promptly shall refund to each participant the amount of the balance in the
participant’s account under the Plan; and thereupon, automatically and without
any further act on his part, his payroll deduction authorization (and
participant contribution agreement, if applicable) and his interest in
unexercised options under the Plan shall terminate. Except with respect to
options then outstanding, if not sooner terminated under the provisions of
paragraph 14, the Plan shall terminate upon and no further options shall be
granted after February 27, 2018.


    
      
         


      

      
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    14.         
AMENDMENT OR TERMINATION
OF THE
PLAN.  The Board in its discretion may terminate the Plan at
any time with respect to any shares for which options have not theretofore been
granted.  The Board shall have the right to alter or amend the Plan or
any part thereof from time to time; provided, that no change in any option
theretofore granted may be made which would impair the rights of the optionee
without the consent of such optionee; and provided, further, that the Board may
not make any alteration or amendment which would increase the aggregate
number of shares which may be issued pursuant to the provisions of the Plan
(other than as a result of the antidilution provisions of the Plan) or change
the class of individuals eligible to receive options under the Plan, without the
approval of the stockholders of the Company.

    


    15.         
SECURITIES
LAWS.  The Company shall not be obligated to issue any Stock
pursuant to any option granted under the Plan at any time when the offer,
issuance, or sale of shares covered by such option has not been registered under
the U.S. Securities Act of 1933, as amended, or does not comply with such other
state, federal, or foreign laws, rules, or regulations or the requirements of
any stock exchange upon which the Stock may then be listed, as the Company or
the Committee deems applicable and, in the opinion of legal counsel for the
Company, there is no exemption from the requirements of such laws, rules,
regulations, or requirements available for the offer, issuance, and sale of such
shares.

    


    Further, all Stock acquired pursuant to the Plan shall be
subject to the Company’s policies concerning compliance with securities laws and
regulations, as such policies may be amended from time to time.  The
terms and conditions of options granted hereunder to, and the purchase of shares
by, persons subject to Section 16 of the U.S. Securities Exchange Act of
1934, as amended (the “Exchange
Act”), shall comply with any applicable provisions of Rule
16b-3.  As to such persons, the Plan shall be deemed to contain, and
such options shall contain, and the shares issued upon exercise thereof shall be
subject to, such additional conditions and restrictions as may be required from
time to time by Rule 16b-3 to qualify for the maximum exemption from
Section 16 of the Exchange Act with respect to Plan
transactions.

    


    16.         
NO RESTRICTION ON
CORPORATE ACTION.  Nothing contained in the Plan shall be
construed to prevent the Company or any subsidiary from taking any corporate
action which is deemed by the Company or such subsidiary to be appropriate or in
its best interest whether or not such action would have an adverse effect on the
Plan or any award made under the Plan.  No employee, beneficiary or
other person shall have any claim against the Company or any subsidiary as a
result of any such action.

    


    17.          MISCELLANEOUS
PROVISIONS.

    


    (a)     
PARENT AND SUBSIDIARY
CORPORATIONS.  For all purposes of the Plan, a corporation
shall be considered to be a parent or subsidiary corporation of the Company only
if such corporation is a parent or subsidiary corporation of the Company within
the meaning of Sections 424(e) and (f) of the Code.

    


    (b)    
 NUMBER AND
GENDER.  Wherever appropriate herein, words used in the
singular shall be considered to include the plural and words used in the plural
shall be considered to include the singular.  The masculine gender,
where appearing in the Plan, shall be deemed to include the feminine
gender.


    
      
         


      

      
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    (c)      HEADINGS.  The
headings and subheadings in the Plan are included solely for convenience, and if
there is any conflict between such headings or subheadings and the text of the
Plan, the text shall control.

    


    (d)      NOT A CONTRACT OF EMPLOYMENT; NO
ACQUIRED RIGHTS.  The adoption and maintenance of the Plan
shall not be deemed to be a contract between the Company and any person or to be
consideration for the employment of any person.  Participation in the
Plan at any given time shall not be deemed to create the right to participate in
the Plan, or any other arrangement permitting an employee of the Company to
purchase Stock at a discount, in the future.  The rights and
obligations under any participant’s terms of employment with the Company shall
not be affected by participation in the Plan.  Nothing herein
contained shall be deemed to give any person the right to be retained in the
employ of the Company or to restrict the right of the Company to discharge any
person at any time, nor shall the Plan be deemed to give the Company the right
to require any person to remain in the employ of the Company or to restrict
any person’s right to terminate his employment at any time.  The Plan
shall not afford any participant any additional right to compensation as a
result of the termination of such participant’s employment for any
reason whatsoever.

    


    (e)    
 COMPLIANCE WITH APPLICABLE
LAWS.  The Company’s obligation to offer, issue, sell, or
deliver Stock under the Plan is at all times subject to all approvals of and
compliance with any governmental authorities (whether domestic or foreign)
required in connection with the authorization, offer, issuance, sale, or
delivery of Stock as well as all federal, state, local, and foreign
laws.  Without limiting the scope of the preceding sentence, and
notwithstanding any other provision in the Plan, the Company shall not be
obligated to grant options or to offer, issue, sell, or deliver Stock under the
Plan to or behalf of any employee who is a citizen or resident of a jurisdiction
the laws of which, for reasons of its public policy, prohibit the Company from
taking any such action with respect to such employee.

    


    (f)      
SEVERABILITY.  If
any provision of the Plan shall be held illegal or invalid for any reason, said
illegality or invalidity shall not affect the remaining provisions hereof;
instead, each provision shall be fully severable, and the Plan shall be
construed and enforced as if said illegal or invalid provision had never been
included herein.

    


    (g)    
 ELECTRONIC AND/OR TELEPHONIC
DOCUMENTATION AND SUBMISSION.  Any of the payroll deduction
authorizations, enrollment documents, and any other forms and designations
referenced in the Plan and their submission may be electronic and/or telephonic,
as directed by the Committee.

    


    (h)     
GOVERNING
LAW.  All provisions of the Plan shall be construed in
accordance with the laws of Texas except to the extent preempted by federal
law.

    


    (i)     
 PERSONAL
REPRESENTATIVE. For purposes of paragraph 8 of the Plan, a
participant’s personal representative shall be the executor or administrator of
the participant’s estate or equivalent individual having the authority under
local law to act on behalf of the deceased participant with respect to the
actions regarding the participant’s Plan participation set forth in paragraph
8.

     

     

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