<PAGE>   1
                                                                   EXHIBIT 10.12





                      CRESCENT REAL ESTATE EQUITIES, LTD.

                         FIRST AMENDED AND RESTATED

                                  401(K) PLAN



Defined Contribution Plan 7.7

Restated March 17, 1997
<PAGE>   2
                     SECOND AMENDMENT TO CRESCENT REAL ESTATE
                    EQUITIES, LTD. FIRST AMENDED AND RESTATED
                                   401(k) PLAN
                (ADOPTED BY WRITTEN CONSENT OF THE SOLE DIRECTOR
                    IN LIEU OF MEETING ON SEPTEMBER 2, 1998)

         The definitions of the following terms in Section 1.02 of the Crescent
Real Estate Equities, Ltd. First Amended and Restated 401(k) Plan are hereby
deleted in their entireties and replaced with the following:

             *           *           *           *           *

         EMPLOYEE means an individual who is a common law employee of the
         Employer or any other employer required to be aggregated with the
         Employer under Code Sections 414(b), (c), (m) or (o). A Controlled
         Group member is required to be aggregated with the Employer.

         ELIGIBLE EMPLOYEE means an Employee of an Employer who is actually
         recorded as an Employee on the Employer's customary and usual payroll
         records at the time services are performed by the Employee, except and
         Employee:

         (a)      whose compensation and conditions of employment are covered by
                  a collective bargaining agreement to which the Employer is a
                  party unless the agreement calls for the Employee's
                  participation in the Plan;

         (b)      who is treated as an Employee because he or she is a Leased
                  Employee; or

         (c)      who is a nonresident alien and who either (i) receives no
                  earned income (within the meaning of Code section 911(d)(2))
                  from any Controlled Group member which constitutes income from
                  sources within the United States under Code section 861(a)(3);
                  or (ii) receives such earned income from such sources within
                  the United States but such income is exempt from United States
                  income tax under an applicable income tax convention.

         If a person who has performed eligible services for an Employer but has
         not been classified as an Employee or an Eligible Employee is
         reclassified as an Employee as a result of a determination made by the
         Employer, a court or governmental agency, such reclassified person
         shall not be an Eligible Employee with respect to any period before the
         date the reclassification determination is made.


                                        
<PAGE>   3
                               TABLE OF CONTENTS


<TABLE>
<CAPTION>
INTRODUCTION
<S>               <C>     <C>
ARTICLE I                 FORMAT AND DEFINITIONS

         Section  1.01    -----   Format
         Section  1.02    -----   Definitions

ARTICLE II                PARTICIPATION

         Section  2.01    -----   Active Participant
         Section  2.02    -----   Inactive Participant
         Section  2.03    -----   Cessation of Participation

ARTICLE III               CONTRIBUTIONS

         Section  3.01    -----   Employer Contributions
         Section  3.01A   -----   Rollover Contributions
         Section  3.02    -----   Forfeitures
         Section  3.03    -----   Allocation
         Section  3.04    -----   Contribution Limitation
         Section  3.05    -----   Excess Amounts

ARTICLE IV                INVESTMENT OF CONTRIBUTIONS

         Section  4.01    -----   Investment of Contributions
         Section  4.01A   -----   Investment in Qualifying Employer Securities
         Section  4.01B   -----   Limitation on Investment in Qualifying Employer
                                  Securities by Some Participants

ARTICLE V                 BENEFITS

         Section  5.01    -----   Retirement Benefits
         Section  5.02    -----   Death Benefits
         Section  5.03    -----   Vested Benefits
         Section  5.04    -----   When Benefits Start
         Section  5.05    -----   Withdrawal Privileges
         Section  5.06    -----   Loans to Participants
</TABLE>





TABLE OF CONTENTS                           3
<PAGE>   4
<TABLE>
<S>                       <C>
ARTICLE VI                DISTRIBUTION OF BENEFITS

         Section  6.01    -----   Form of Distribution
         Section  6.02    -----   Election Procedures
         Section  6.03    -----   Notice Requirements
         Section  6.04    -----   Distributions Under Qualified
                                  Domestic Relations Orders

ARTICLE VII               TERMINATION OF PLAN

ARTICLE VIII              ADMINISTRATION OF PLAN

         Section  8.01    -----   Administration
         Section  8.02    -----   Records
         Section  8.03    -----   Information Available
         Section  8.04    -----   Claim and Appeal Procedures
         Section  8.05    -----   Unclaimed Vested Account Procedure
         Section  8.06    -----   Delegation of Authority

ARTICLE IX                GENERAL PROVISIONS

         Section  9.01    -----   Amendments
         Section  9.02    -----   Direct Rollovers
         Section  9.03    -----   Mergers and Direct Transfers
         Section  9.04    -----   Provisions Relating to the Insurer and Other Parties
         Section  9.05    -----   Employment Status
         Section  9.06    -----   Rights to Plan Assets
         Section  9.07    -----   Beneficiary
         Section  9.08    -----   Nonalienation of Benefits
         Section  9.09    -----   Construction
         Section  9.10    -----   Legal Actions
         Section  9.11    -----   Small Amounts
         Section  9.12    -----   Word Usage
         Section  9.13    -----   Transfers Between Plans

ARTICLE X                 TOP-HEAVY PLAN REQUIREMENTS

         Section 10.01    -----   Application
         Section 10.02    -----   Definitions
         Section 10.03    -----   Modification of Vesting Requirements
         Section 10.04    -----   Modification of Contributions
         Section 10.05    -----   Modification of Contribution Limitation

PLAN EXECUTION
</TABLE>





TABLE OF CONTENTS                       4
<PAGE>   5
                                  INTRODUCTION


         The Primary Employer previously established a 401(k) savings plan on
July 1, 1994.

         The Primary Employer is of the opinion that the plan document should
be amended and restated and that the plan should be continued.  It believes
that the best means to accomplish these changes is to completely amend and
restate the plan's terms, provisions and conditions.  This amendment and
restatement of the plan document, effective March 17, 1997, is substituted in
lieu of the prior plan document; provided, however, that the plan shall
continue and shall not constitute a new plan.

         The plan, as amended and restated herein, continues to be for the
exclusive benefit of employees of the Employer.  All persons covered under the
plan on March 16, 1997, shall continue to be covered under the plan, as amended
and restated herein, with no loss of benefits.

         It is intended that the plan, as amended and restated herein, shall
continue to qualify as a profit sharing plan under the Internal Revenue Code of
1986, including any later amendments to the Code.





INTRODUCTION                             5
<PAGE>   6
                                   ARTICLE I

                             FORMAT AND DEFINITIONS

SECTION 1.01--FORMAT.

         Words and phrases defined in the DEFINITIONS SECTION of Article I
shall have that defined meaning when used in this Plan, unless the context
clearly indicates otherwise.

         These words and phrases have an initial capital letter to aid in
identifying them as defined terms.

SECTION 1.02--DEFINITIONS.

         ACCOUNT means, for a Participant, his share of the Investment Fund.
         Separate accounting records are kept for those parts of his Account
         that result from:

         (a)     Elective Deferral Contributions

         (b)     Matching Contributions

         (c)     Other Employer Contributions

                 If the Employer elects to include any of these Contributions
                 in computing the percentages in the EXCESS AMOUNTS SECTION of
                 Article III, a separate accounting record shall be kept for
                 any part of his Account resulting from such Employer
                 Contributions.

         (d)     Rollover Contributions

         If the Participant's Vesting Percentage is less than 100% as to any of
         the Employer Contributions, a separate accounting record will be kept
         for any part of his Account resulting from such Employer Contributions
         and, if there has been a prior Forfeiture Date, from such
         Contributions made before a prior Forfeiture Date.

         A Participant's Account shall be reduced by any distribution of his
         Vested Account and by any Forfeitures.  A Participant's Account will
         participate in the earnings credited, expenses charged and any
         appreciation or depreciation of the Investment Fund.  His Account is
         subject to any minimum guarantees applicable under the Group Contract
         or other investment arrangement.

         ACCRUAL COMPUTATION PERIOD means a 12-consecutive month period ending
         on the last day of each Plan Year, including corresponding
         12-consecutive month periods before July 1, 1994.

         ACTIVE PARTICIPANT means an Eligible Employee who is actively
         participating in the Plan according to the provisions in the ACTIVE
         PARTICIPANT SECTION of Article II.

         AFFILIATED SERVICE GROUP means any group of corporations, partnerships
         or other organizations of which the Employer is a part and which is
         affiliated within the meaning of Code Section 414(m) and regulations
         thereunder.  Such a group includes at least two organizations one of
         which is either a service





ARTICLE I                           6
<PAGE>   7
         organization (that is, an organization the principal business of which
         is performing services), or an organization the principal business of
         which is performing management functions on a regular and continuing
         basis.  Such service is of a type historically performed by employees.
         In the case of a management organization, the Affiliated Service Group
         shall include organizations related, within the meaning of Code
         Section 144(a)(3), to either the management organization or the
         organization for which it performs management functions.  The term
         Controlled Group, as it is used in this Plan, shall include the term
         Affiliated Service Group.

         ALTERNATE PAYEE means any spouse, former spouse, child or other
         dependent of a participant who is recognized by a qualified domestic
         relations order as having a right to receive all, or a portion of the
         benefits payable under the Plan with respect to such Participant.

         ANNIVERSARY DATE means December 31.

         ANNUAL COMPENSATION means, on any given date, the Employee's
         Compensation for the latest Compensation Year ending on or before the
         given date.

         ANNUITY STARTING DATE means, for a Participant, the first day of the
         first period for which an amount is payable in a single sum.

         BENEFICIARY means the person or persons named by a Participant to
         receive any benefits under this Plan upon the Participant's death.
         Unless a qualified election has been made, for the purpose of
         distributing any death benefits before Annuity Starting Date, the
         Beneficiary of a married Participant shall be the Participant's
         spouse.  See the BENEFICIARY SECTION of Article IX.

         CLAIMANT means any person who has made a claim for benefits under this
         Plan.  See the CLAIM AND APPEAL PROCEDURES SECTION of Article VIII.

         CODE means the Internal Revenue Code of 1986, as amended.

         COMPENSATION means, except as modified in this definition, the total
         earnings paid or made available to an Employee by the Employer during
         any specified period.

         "Earnings" in this definition means Compensation as defined in the
         CONTRIBUTION LIMITATION SECTION of Article III.

         Compensation shall also include elective contributions.  Elective
         contributions are amounts excludable from the Employee's gross income
         under Code Sections 125, 402(e)(3), 402(h) or 403(b), and contributed
         by the Employer, at the Employee's election, to a Code Section 401(k)
         arrangement, a simplified employee pension, cafeteria plan or
         tax-sheltered annuity.  Elective contributions also include
         Compensation deferred under a Code Section 457 plan maintained by the
         Employer and Employee contributions "picked up" by a governmental
         entity and, pursuant to Code Section 414(h)(2), treated as Employer
         contributions.

         For purposes of the EXCESS AMOUNTS SECTION of Article III, the
         Employer may elect to use an alternative nondiscriminatory definition
         of Compensation in accordance with the regulations under Code Section
         414(s).

         Compensation shall exclude earnings paid before the Employee's Entry
         Date.

         For Plan Years beginning after December 31, 1988, and before January
         1, 1994, the annual Compensation of each Participant taken into
         account for determining all benefits provided under the Plan for any
         year shall not exceed $200,000.  For Plan Years beginning on or after
         January 1, 1994, the annual Compensation of each Participant taken
         into account for determining all benefits provided under the Plan for
         any year shall not exceed $150,000.





ARTICLE I                           7
<PAGE>   8
         The $200,000 limit shall be adjusted by the Secretary at the same time
         and in the same manner as under Code Section 415(d).  The $150,000
         limit shall be adjusted by the Commissioner for increases in the cost
         of living in accordance with Code Section 401(a)(17)(B).  The cost of
         living adjustment in effect for a calendar year applies to any period,
         not exceeding 12 months, over which pay is determined (determination
         period) beginning in such calendar year.  If a determination period
         consists of fewer than 12 months, the annual compensation limit will
         be multiplied by a fraction the numerator of which is the number of
         months in the determination period, and the denominator of which is
         12.

         In determining the Compensation of a Participant for purposes of the
         annual compensation limit, the rules of Code Section 414(q)(6) shall
         apply, except that in applying such rules, the term "family" shall
         include only the spouse of the Participant and any lineal descendants
         of the Participant who have not attained age 19 before the close of
         the year.  If, as a result of the application of such rules the
         adjusted annual compensation limit is exceeded, then (except for
         purposes of determining the portion of Compensation up to the
         integration level if this Plan provides for permitted disparity) the
         limitation shall be prorated among the affected individuals in
         proportion to each such individual's Compensation as determined under
         this definition prior to the application of this limitation.

         If Compensation for any prior determination period is taken into
         account in determining a Participant's benefits accruing in the
         current Plan Year, the Compensation for that prior determination
         period is subject to the annual compensation limit in effect for that
         prior determination period.  For this purpose, for determination
         periods beginning before the first day of the first Plan Year
         beginning on or after January 1, 1989, which are used to determine
         benefits in Plan Years beginning after December 31, 1988 and before
         January 1, 1994, the annual compensation limit is $200,000.  For this
         purpose, for determination periods beginning before the first day of
         the first Plan Year beginning on or after January 1, 1994, which are
         used to determine benefits in Plan Years beginning on or after January
         1, 1994, the annual compensation limit is $150,000.

         Compensation means, for an Employee who is a Leased Employee, the
         Employee's Compensation for the services he performs for the Employer,
         determined in the same manner as the Compensation of Employees who are
         not Leased Employees, regardless of whether such Compensation would be
         received directly from the Employer or from the leasing organization.

         COMPENSATION YEAR means each one-year period ending on the last day of
         the Plan Year, including corresponding periods before July 1, 1994.

         CONTRIBUTIONS means

                 Elective Deferral Contributions
                 Matching Contributions
                 Qualified Nonelective Contributions
                 Discretionary Contributions
                 Rollover Contributions





ARTICLE I                             8
<PAGE>   9
         as set out in Article III, unless the context clearly indicates
         otherwise.

         CONTROLLED GROUP means any group of corporations, trades or businesses
         of which the Employer is a part that are under common control.  A
         Controlled Group includes any group of corporations, trades or
         businesses, whether or not incorporated, which is either a
         parent-subsidiary group, a brother-sister group, or a combined group
         within the meaning of Code Section 414(b), Code Section 414(c) and
         regulations thereunder and, for purposes of determining contribution
         limitations under the CONTRIBUTION LIMITATION SECTION of Article III,
         as modified by Code Section 415(h) and, for the purpose of identifying
         Leased Employees, as modified by Code Section 144(a)(3).  The term
         Controlled Group, as it is used in this Plan, shall include the term
         Affiliated Service Group and any other employer required to be
         aggregated with the Employer under Code Section 414(o) and the
         regulations thereunder.

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

         DISCRETIONARY CONTRIBUTIONS means discretionary contributions made by
         the Employer to fund this Plan.  See the EMPLOYER CONTRIBUTIONS
         SECTION of Article III.

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

         ELECTIVE DEFERRAL CONTRIBUTIONS means Contributions made by the
         Employer to fund this Plan in accordance with a qualified cash or
         deferred arrangement as described in Code Section 401(k).  See the
         EMPLOYER CONTRIBUTIONS SECTION of Article III.

         ELIGIBILITY SERVICE means an Employee's Period of Service.  If he has
         more than one Period of Service, or if all or a part of a Period of
         Service is not counted, his Eligibility Service shall be determined by
         adjusting his Employment Commencement Date so that he has one
         continuous period of Eligibility Service equal to the aggregate of all
         his countable Periods of Service.  An Employee's Eligibility Service
         shall be determined on the basis that 30 days equal one month and 365
         days equal one year.

         However, Eligibility Service is modified as follows:

         Period of Military Duty included:

                 A Period of Military Duty shall be included as service with
                 the Employer to the extent it has not already been credited.

         Period of Severance included (service spanning rule):

                 A Period of Severance shall be deemed to be a Period of
                 Service under either of the following conditions:

                 (a)      the Period of Severance immediately follows a period
                          during which an Employee is not absent from work and
                          ends within 12 months; or

                 (b)      the Period of Severance immediately follows a period
                          during which an Employee is absent from work for any
                          reason other than quitting, being discharged or
                          retiring (such as a leave of absence or layoff) and
                          ends within 12 months of the date he was first
                          absent.





ARTICLE I                             9
<PAGE>   10
         Controlled Group service included:

                 An Employee's service with a member firm of a Controlled Group
                 while both that firm and the Employer were members of the
                 Controlled Group shall be included as service with the
                 Employer.

         ELIGIBLE EMPLOYEE means any Employee of the Employer who meets the
         following requirement.  He is not engaged as an independent contractor
         or he is not classified as ineligible for participation in the Plan.

         ELIGIBLE RETIREMENT PLAN means an individual retirement account
         described in Code Section 408(a), an individual retirement annuity
         described in Code Section 408(b), an annuity plan described in Code
         Section 403(a) or a qualified trust described in Code Section 401(a),
         that accepts the Distributee's Eligible Rollover Distribution.

         However, in the case of an Eligible Rollover Distribution to the
         surviving spouse, an Eligible Retirement Plan is an individual
         retirement account or individual retirement annuity.

         ELIGIBLE ROLLOVER DISTRIBUTION means any distribution of all or any
         portion of the balance to the credit of the Distributee, except that
         an Eligible Rollover Distribution does not include:

         (a)     Any distribution that is one of a series of substantially
                 equal periodic payments (not less frequently than annually)
                 made for the life (or life expectancy) of the Distributee or
                 the joint lives (or joint life expectancies) of the
                 Distributee and the Distributee's designated Beneficiary, or
                 for a specified period of ten years or more.

         (b)     Any distribution to the extent such distribution is required
                 under Code Section 401(a)(9).

         (c)     The portion of any distribution that is not includible in
                 gross income (determined without regard to the exclusion for
                 net unrealized appreciation with respect to employer
                 securities).

         EMPLOYEE means an individual who is employed by the Employer or any
         other employer required to be aggregated with the Employer under Code
         Sections 414(b), (c), (m) or (o).  A Controlled Group member is
         required to be aggregated with the Employer.

         The term Employee shall also include any Leased Employee deemed to be
         an employee of any employer described in the preceding paragraph as
         provided in Code Sections 414(n) or 414(o).

         EMPLOYER means the Primary Employer.  This will also include any
         successor corporation or firm of the Employer which shall, by written
         agreement, assume the obligations of this Plan or any predecessor
         corporation or firm of the Employer (absorbed by the Employer, or of
         which the Employer was once a part) which became a predecessor because
         of a change of name, merger, purchase of stock or purchase of assets
         and which maintained this Plan.

         EMPLOYER CONTRIBUTIONS means

                 Elective Deferral Contributions
                 Matching Contributions
                 Qualified Nonelective Contributions
                 Discretionary Contributions

         as set out in Article III, unless the context clearly indicates
         otherwise.

         EMPLOYMENT COMMENCEMENT DATE means the date an Employee first performs
         an Hour-of-Service.





ARTICLE I                        10
<PAGE>   11
         ENTRY DATE means the date an Employee first enters the Plan as an
         Active Participant.  See the ACTIVE PARTICIPANT SECTION of Article II.

         FISCAL YEAR means the Primary Employer's taxable year.  The last day
         of the Fiscal Year is December 31.

         FORFEITURE means the part, if any, of a Participant's Account that is
         forfeited.  See the FORFEITURES SECTION of Article III.

         FORFEITURE DATE means, as to a Participant, the date the Participant
         incurs five consecutive Vesting Breaks in Service.  A Participant
         incurs a Vesting Break in Service on the last day of the period used
         to determine the Vesting Break in Service.

         This is the date on which the Participant's Nonvested Account will be
         forfeited unless an earlier forfeiture occurs as provided in the
         FORFEITURES SECTION of Article III.

         GROUP CONTRACT means the group annuity contract or contracts into
         which the Trustee enters with the Insurer for the investment of
         Contributions and the payment of benefits under this Plan.  The term
         Group Contract as it is used in this Plan is deemed to include the
         plural unless the context clearly indicates otherwise.

         HIGHLY COMPENSATED EMPLOYEE means a highly compensated active Employee
         or a highly compensated former Employee.

         A highly compensated active Employee means any Employee who performs
         service for the Employer during the determination year and who, during
         the look-back year is:

         (a)     An Employee who is a 5% owner, as defined in Section
                 416(i)(1)(B)(i), at any time during the determination year or
                 the look-back year.

         (b)     An Employee who receives compensation in excess of $75,000
                 (indexed in accordance with Section 415(d) during the
                 look-back year.

         (c)     An Employee who receives compensation in excess of $50,000
                 (indexed in accordance with Section 415(d) during the
                 look-back year and is a member of the top-paid group for the
                 look-back year.





ARTICLE I                          11
<PAGE>   12
         (d)     An Employee who is an officer, within the meaning of Section
                 416(i), during the look-back year and who receives
                 compensation in the look-back year greater than 50% of the
                 dollar limitation in effect under Section 415(b)(1)(A) for the
                 calendar year in which the look-back year begins.  The number
                 of officers is limited to 50 (or, if lesser, the greater of 3
                 employees or 10% of employees) excluding those employees who
                 may be excluded in determining the top-paid group.

         (e)     An Employee who is both described in paragraph b, c or d above
                 when these paragraphs are modified to substitute the
                 determination year for the look-back year and one of the 100
                 Employees who receive the most compensation from the Employer
                 during the determination year.

         If no officer has satisfied the compensation requirement of (c) above
         during either a determination year or look-back year, the highest paid
         officer for such year shall be treated as a Highly Compensated
         Employee.

         For this purpose, the determination year shall be the Plan Year.  The
         look-back year shall be the twelve-month period immediately preceding
         the determination year.

         A highly compensated former Employee means any Employee who separated
         from service (or was deemed to have separated) prior to the
         determination year, performs no service for the Employer during the
         determination year, and was a highly compensated active Employee for
         either the separation year or any determination year ending on or
         after the Employee's 55th birthday.

         If an Employee is, during a determination year or look-back year, a
         family member of either a 5 percent owner who is an active or former
         Employee or a Highly Compensated Employee who is one of the 10 most
         highly compensated Employees ranked on the basis of compensation paid
         by the Employer during such year, then the family member and the 5
         percent owner or top-ten highly compensated Employee shall be
         aggregated.  In such case, the family member and 5 percent owner or
         top-ten highly compensated Employee shall be treated as a single
         Employee receiving compensation and Plan contributions or benefits
         equal to the sum of such compensation and contributions or benefits of
         the family member and 5 percent owner or top-ten highly compensated
         Employee.  For purposes of this definition, family member includes the
         spouse, lineal ascendants and descendants of the Employee or former
         Employee and the spouses of such lineal ascendants and descendants.

         Compensation is compensation within the meaning of Code Section
         415(c)(3), including elective or salary reduction contributions to a
         cafeteria plan, cash or deferred arrangement or tax-sheltered annuity.
         The top- paid group consists of the top 20% of employees ranked on the
         basis of compensation received during the year.

         Employers aggregated under Section 414(b), (c), (m) or (o) are treated
         as a single Employer.

         HOUR-OF-SERVICE means, for the elapsed time method of crediting
         service in this Plan, each hour for which an Employee is paid, or
         entitled to payment, for performing duties for the Employer.
         Hour-of-Service means, for the hours method of crediting service in
         this Plan, the following:

         (a)     Each hour for which an Employee is paid, or entitled to
                 payment, for performing duties for the Employer during the
                 applicable computation period.





ARTICLE I                          12
<PAGE>   13
         (b)     Each hour for which an Employee is paid, or entitled to
                 payment, by the Employer because of a period of time in which
                 no duties are performed (irrespective of whether the
                 employment relationship has terminated) due to vacation,
                 holiday, illness, incapacity (including disability), layoff,
                 jury duty, military duty or leave of absence.  Notwithstanding
                 the preceding provisions of this subparagraph (b), no credit
                 will be given to the Employee

                 (1)      for more than 501 Hours-of-Service under this
                          subparagraph (b) because of any single continuous
                          period in which the Employee performs no duties
                          (whether or not such period occurs in a single
                          computation period); or

                 (2)      for an Hour-of-Service for which the Employee is
                          directly or indirectly paid, or entitled to payment,
                          because of a period in which no duties are performed
                          if such payment is made or due under a plan
                          maintained solely for the purpose of complying with
                          applicable worker's or workmen's compensation, or
                          unemployment compensation or disability insurance
                          laws; or

                 (3)      for an Hour-of-Service for a payment which solely
                          reimburses the Employee for medical or medically
                          related expenses incurred by him.

                 For purposes of this subparagraph (b), a payment shall be
                 deemed to be made by, or due from the Employer, regardless of
                 whether such payment is made by, or due from the Employer,
                 directly or indirectly through, among others, a trust fund or
                 insurer, to which the Employer contributes or pays premiums
                 and regardless of whether contributions made or due to the
                 trust fund, insurer or other entity are for the benefit of
                 particular employees or are on behalf of a group of employees
                 in the aggregate.

         (c)     Each hour for which back pay, irrespective of mitigation of
                 damages, is either awarded or agreed to by the Employer.  The
                 same Hours-of-Service shall not be credited both under
                 subparagraph (a) or subparagraph (b) above (as the case may
                 be) and under this subparagraph (c).  Crediting of
                 Hours-of-Service for back pay awarded or agreed to with
                 respect to periods described in subparagraph (b) above will be
                 subject to the limitations set forth in that subparagraph.

         The crediting of Hours-of-Service above shall be applied under the
         rules of paragraphs (b) and (c) of the Department of Labor Regulation
         2530.200b-2 (including any interpretations or opinions implementing
         said rules); which rules, by this reference, are specifically
         incorporated in full within this Plan.  The reference to paragraph (b)
         applies to the special rule for determining hours of service for
         reasons other than the performance of duties such as payments
         calculated (or not calculated) on the basis of units of time and the
         rule against double credit.  The reference to paragraph (c) applies to
         the crediting of hours of service to computation periods.

         Hours-of-Service shall be credited for employment with any other
         employer required to be aggregated with the Employer under Code
         Sections 414(b), (c), (m) or (o) and the regulations thereunder for
         purposes of eligibility and vesting.  Hours-of-Service shall also be
         credited for any individual who is considered an employee for purposes
         of this Plan pursuant to Code Section 414(n) or Code Section 414(o)
         and the regulations thereunder.

         Solely for purposes of determining whether a one-year break in service
         has occurred for eligibility or vesting purposes, during a Parental
         Absence an Employee shall be credited with the Hours-of-Service which
         otherwise would normally have been credited to the Employee but for
         such absence, or in any case





ARTICLE I                           13
<PAGE>   14
         in which such hours cannot be determined, eight Hours-of-Service per
         day of such absence.  The Hours-of-Service credited under this
         paragraph shall be credited in the computation period in which the
         absence begins if the crediting is necessary to prevent a break in
         service in that period; or in all other cases, in the following
         computation period.

         INACTIVE PARTICIPANT means a former Active Participant who has an
         Account.  See the INACTIVE PARTICIPANT SECTION of Article II.

         INSURER means Principal Mutual Life Insurance Company and any other
         insurance company or companies named by the Trustee or Primary
         Employer.

         INVESTMENT FUND means the total assets held for the purpose of
         providing benefits for Participants.  These funds result from
         Contributions made under the Plan.

         INVESTMENT MANAGER means any fiduciary (other than a trustee or Named
         Fiduciary)

         (a)     who has the power to manage, acquire, or dispose of any assets
                 of the Plan; and

         (b)     who (1) is registered as an investment adviser under the
                 Investment Advisers Act of 1940, or (2) is a bank, as defined
                 in the Investment Advisers Act of 1940, or (3) is an insurance
                 company qualified to perform services described in
                 subparagraph (a) above under the laws of more than one state;
                 and

         (c)     who has acknowledged in writing being a fiduciary with respect
                 to the Plan.

         LATE RETIREMENT DATE means the Anniversary Date coinciding with or
         next following a Participant's Normal Retirement Date and on which
         retirement benefits begin.  If a Participant continues to work for the
         Employer after his Normal Retirement Date, his Late Retirement Date
         shall be the earliest Anniversary Date on or after he ceases to be an
         Employee.  An earlier or a later Retirement Date may apply if the
         Participant so elects.  An earlier Retirement Date may apply if the
         Participant is age 70 1/2.  See the WHEN BENEFITS START SECTION of
         Article V.

         LEASED EMPLOYEE means any person (other than an employee of the
         recipient) who pursuant to an agreement between the recipient and any
         other person ("leasing organization") has performed services for the
         recipient (or for the recipient and related persons determined in
         accordance with Code Section 414(n)(6)) on a substantially full time
         basis for a period of at least one year, and such services are of a
         type historically performed by employees in the business field of the
         recipient employer.  Contributions or benefits provided a Leased
         Employee by the leasing organization which are attributable to service
         performed for the recipient employer shall be treated as provided by
         the recipient employer.

         A Leased Employee shall not be considered an employee of the recipient
         if:

         (a)     such employee is covered by a money purchase pension plan
                 providing (1) a nonintegrated employer contribution rate of at
                 least 10 percent of compensation, as defined in Code Section
                 415(c)(3), but including amounts contributed pursuant to a
                 salary reduction agreement which are excludable from the
                 employee's gross income under Code Sections 125, 402(e)(3),
                 402(h) or 403(b), (2) immediate participation, and (3) full
                 and immediate vesting and





ARTICLE I                              14
<PAGE>   15
         (b)     Leased Employees do not constitute more than 20 percent of the
                 recipient's nonhighly compensated workforce.

         LOAN ADMINISTRATOR means the person or positions authorized to
         administer the Participant loan program.

         The Loan Administrator is the H.R. Director.

         MATCHING CONTRIBUTIONS means matching contributions made by the
         Employer to fund this Plan.  See the EMPLOYER CONTRIBUTIONS SECTION of
         Article III.

         MONTHLY DATE means each Yearly Date and the same day of each following
         month during the Plan Year beginning on such Yearly Date.

         NAMED FIDUCIARY means the person or persons who have authority to
         control and manage the operation and administration of the Plan.

         The Named Fiduciary is the Employer.

         NONHIGHLY COMPENSATED EMPLOYEE means an Employee of the Employer who
         is neither a Highly Compensated Employee nor a Family Member.

         NONVESTED ACCOUNT means the part, if any, of a Participant's Account
         that is in excess of his Vested Account.

         NORMAL RETIREMENT AGE means the age at which the Participant's normal
         retirement benefit becomes nonforfeitable.  A Participant's Normal
         Retirement Age is the older of age 65 or his age on the date five
         years after the first day of the Plan Year in which his Entry Date
         occurred.

         NORMAL RETIREMENT DATE means the Anniversary Date coinciding with or
         next following the date the Participant reaches his Normal Retirement
         Age.  Unless otherwise provided in this Plan, a Participant's
         retirement benefits shall begin on a Participant's Normal Retirement
         Date if he has ceased to be an Employee on such date and has a Vested
         Account.  Even if the Participant is an Employee on his Normal
         Retirement Date, he may choose to have his retirement benefit begin on
         such date.  See the WHEN BENEFITS START SECTION of Article V.

         PARENTAL ABSENCE means an Employee's absence from work which begins on
         or after the first Yearly Date after December 31, 1984,

         (a)     by reason of pregnancy of the Employee,

         (b)     by reason of birth of a child of the Employee,

         (c)     by reason of the placement of a child with the Employee in
                 connection with adoption of such child by such Employee, or

         (d)     for purposes of caring for such child for a period beginning
                 immediately following such birth or placement.





ARTICLE I                              15
<PAGE>   16
         PARTICIPANT means either an Active Participant or an Inactive
         Participant.

         PERIOD OF MILITARY DUTY means, for an Employee

         (a)     who served as a member of the armed forces of the United
                 States, and

         (b)     who was reemployed by the Employer at a time when the Employee
                 had a right to reemployment in accordance with seniority
                 rights as protected under Section 2021 through 2026 of Title
                 38 of the U. S.  Code,

         the period of time from the date the Employee was first absent from
         active work for the Employer because of such military duty to the date
         the Employee was reemployed.

         PERIOD OF SERVICE means a period of time beginning on an Employee's
         Employment Commencement Date or Reemployment Commencement Date
         (whichever applies) and ending on his Severance from Service Date.

         PERIOD OF SEVERANCE means a period of time beginning on an Employee's
         Severance from Service Date and ending on the date he again performs
         an Hour-of-Service.

         A one-year Period of Severance means a Period of Severance of 12
         consecutive months.

         Solely for purposes of determining whether a one-year Period of
         Severance has occurred for eligibility or vesting purposes, the
         12-consecutive month period beginning on the first anniversary of the
         first date of a Parental Absence shall not be a one-year Period of
         Severance.

         PLAN means the 401(k) savings plan of the Employer set forth in this
         document, including any later amendments to it.

         PLAN ADMINISTRATOR means the person or persons who administer the
         Plan.

         The Plan Administrator is the Employer.

         PLAN YEAR means a period beginning on a Yearly Date and ending on the
         day before the next Yearly Date.

         PRIMARY EMPLOYER means Crescent Real Estate Equities, Ltd.

         QUALIFIED NONELECTIVE CONTRIBUTIONS means contributions (other than
         Employer Contributions made to the Plan on behalf of a Participant on
         account of Elective Deferral Contributions or on account of
         contributions made by the Participant) made by the Employer to fund
         this Plan which an Employee may not elect to have paid to him in cash
         instead of being contributed to the Plan and which are subject to the
         distribution and nonforfeitability requirements under Code Section
         401(k).  See the EMPLOYER CONTRIBUTIONS SECTION of Article III.

         QUALIFYING EMPLOYER SECURITIES means any instrument issued by the
         Employer and meeting the requirements of Section 4975(e)(8) of the
         Code.





ARTICLE I                             16
<PAGE>   17
         QUALIFYING EMPLOYER SECURITIES ACCOUNT means for a Participant, his
         share of Qualifying Employer Securities.

         QUARTERLY DATE means each Yearly Date and the third, sixth and ninth
         Monthly Date after each Yearly Date which is within the same Plan
         Year.

         REEMPLOYMENT COMMENCEMENT DATE means the date an Employee first
         performs an Hour-of-Service following a Period of Severance.

         REENTRY DATE means the date a former Active Participant reenters the
         Plan.  See the ACTIVE PARTICIPANT SECTION of Article II.

         RETIREMENT DATE means the date a retirement benefit will begin and is
         a Participant's Normal or Late Retirement Date, as the case may be.

         ROLLOVER CONTRIBUTIONS means the Rollover Contributions which are made
         by or for a Participant according to the provisions of the ROLLOVER
         CONTRIBUTIONS SECTION of Article III.

         SEVERANCE FROM SERVICE DATE means the earlier of

         (a)     the date on which an Employee quits, retires, dies or is
                 discharged, or

         (b)     the first anniversary of the date an Employee begins a
                 one-year absence from service (with or without pay).  This
                 absence may be the result of any combination of vacation,
                 holiday, sickness, disability, leave of absence or layoff.

         Solely to determine whether a one-year Period of Severance has
         occurred for eligibility or vesting purposes for an Employee who is
         absent from service beyond the first anniversary of the first day of a
         Parental Absence, Severance from Service Date is the second
         anniversary of the first day of the Parental Absence.  The period
         between the first and second anniversaries of the first day of the
         Parental Absence is not a Period of Service and is not a Period of
         Severance.  TEFRA means the Tax Equity and Fiscal Responsibility Act
         of 1982.

         TEFRA COMPLIANCE DATE means the date a plan is to comply with the
         provisions of TEFRA.  The TEFRA Compliance Date as used in this Plan
         is,

         (a)     for purposes of contribution limitations, Code Section 415,

                 (1)      if the plan was in effect on July 1, 1982, the first
                          day of the first limitation year which begins after
                          December 31, 1982, or

                 (2)      if the plan was not in effect on July 1, 1982, the
                          first day of the first limitation year which ends
                          after July 1, 1982.

         (b)     for all other purposes, the first Yearly Date after December
                  31, 1983.





ARTICLE I                             17
<PAGE>   18
         TOTALLY AND PERMANENTLY DISABLED means that a Participant is disabled
         as a result of a physical or mental condition resulting from bodily
         injury, disease or mental disorder that renders him incapable of
         continuing any gainful occupation and is eligible for and receives a
         disability benefit under Title II of the Federal Social Security Act.

         TRUST means an agreement of trust between the Primary Employer and
         Trustee established for the purpose of holding and distributing the
         Trust Fund under the provisions of the Plan.  The Trust may provide
         for the investment of all or any portion of the Trust Fund in the
         Group Contract.

         TRUST FUND means the total funds held under the Trust for the purpose
         of providing benefits for Participants.  These funds result from
         Contributions made under the Plan which are forwarded to the Trustee
         to be deposited in the Trust Fund.

         TRUSTEE means the trustee or trustees under the Trust.  The term
         Trustee as it is used in this Plan is deemed to include the plural
         unless the context clearly indicates otherwise.

         VALUATION DATE means for the purposes of the date on which the value
         of the assets of the Trust is determined.  The value of each Account
         which is maintained under this Plan shall be determined on the
         Valuation Date.  In each Plan Year, the Valuation Date shall be the
         close of each business day.

         VESTED ACCOUNT means the vested part of a Participant's Account.  The
         Participant's Vested Account is determined as follows.

         If the Participant's Vesting Percentage is 100%, his Vested Account
         equals his Account.

         If the Participant's Vesting Percentage is less than 100%, his Vested
         Account equals the sum of (a) and (b) below:

         (a)     The part of the Participant's Account that results from
                 Employer Contributions made before a prior Forfeiture Date and
                 all other Contributions which were 100% vested when made.

         (b)     The balance of the Participant's Account in excess of the
                 amount in (a) above multiplied by his Vesting Percentage.

         If the Participant has withdrawn any part of his Account resulting
         from Employer Contributions, other than the vested Employer
         Contributions included in (a) above, the amount determined under this
         subparagraph (b) shall be equal to P(AB + D) - D as defined below:

         P       The Participant's Vesting Percentage.

         AB      The balance of the Participant's Account in excess of the
                 amount in (a) above.

         D       The amount of withdrawal resulting from Employer
                 Contributions, other than the vested Employer Contributions
                 included in (a) above.

         The Participant's Vested Account is nonforfeitable.





ARTICLE I                            18
<PAGE>   19
         VESTING BREAK IN SERVICE means a Vesting Computation Period in which
         an Employee is credited with 500 or fewer Hours-of-Service.  An
         Employee incurs a Vesting Break in Service on the last day of a
         Vesting Computation Period in which he has a Vesting Break in Service.

         If any former Participant is reemployed after a Vesting Break in
         Service has occurred, Vesting Service shall include Vesting Service
         prior to his Vesting Break in Service subject to the following rules:

         (i)     If a former Participant has a Vesting Break in Service, his
                 pre-break and post-break service shall be used for computing
                 Vesting Service only after he has been employed for one (1)
                 Year of Service following the date of his reemployment with
                 the Employer.

         (ii)    Any former Participant who under the Plan does not have a
                 nonforfeitable right to any interest in the Plan resulting
                 from Employer Contributions shall lose credits otherwise
                 allowable under (i) above if his consecutive Vesting Breaks in
                 Service equal or exceed the greater of (A) five (5) or (B) the
                 aggregate number of his pre-break Years of Service;

         (iii)   After five (5) consecutive Vesting Breaks in Service, a former
                 Participant's Vested Account balance attributable to pre-break
                 service shall not be increased as a result of post-break
                 service;

         (iv)    If a former Participant who has not had his Years of Service
                 before a Vesting Break in Service disregarded pursuant to (ii)
                 above completes a Year of Service (a Vesting Break in Service
                 previously occurred, but employment had not terminated), he
                 shall participate in the Plan retroactively from the first day
                 of the Plan Year during which he completes one (1) Year of
                 Service.

         VESTING COMPUTATION PERIOD means a 12-consecutive month period ending
         on the last day of each Plan Year, including corresponding
         12-consecutive month periods before July 1, 1994.

         VESTING PERCENTAGE means the percentage used to determine the
         nonforfeitable portion of a Participant's Account attributable to
         Employer Contributions which were not 100% vested when made.

         A Participant's Vesting Percentage is shown in the following schedule
         opposite the number of whole years of his Vesting Service.


<TABLE>
<CAPTION>
                          ------------------------------------------------              
                             VESTING SERVICE                   VESTING                     
                              (whole years)                   PERCENTAGE
                          ------------------------------------------------
                               <S>                               <C>                       
                               Less than 1                        0                        
                          ------------------------------------------------
                                    2                             20                       
                          ------------------------------------------------                 
                                    2                             40                       
                          ------------------------------------------------                 
                                    3                             60                       
                          ------------------------------------------------                 
                                    4                             80                       
                          ------------------------------------------------                 
                                5 or more                        100                       
                          ------------------------------------------------
</TABLE>

         However, the Vesting Percentage for a Participant who is an Employee
         on or after the earliest of (i) the date he reaches his Normal
         Retirement Age, (ii) the date of his death, or (iii) the date he
         becomes Totally and Permanently Disabled, shall be 100% on such date.
         If the schedule used to determine a Participant's Vesting Percentage
         is changed, the new schedule shall not





ARTICLE I                           19
<PAGE>   20
         apply to a Participant unless he is credited with an Hour-of-Service
         on or after the date of the change and the Participant's
         nonforfeitable percentage on the day before the date of the change is
         not reduced under this Plan.  The amendment provisions of the
         AMENDMENT SECTION of Article IX regarding changes in the computation
         of the Vesting Percentage shall apply.

         VESTING SERVICE means one year of service for each Vesting Computation
         Period in which an Employee is credited with at least 1,000
         Hours-of-Service.

         However, Vesting Service is modified as follows:

         Service before a date excluded:

                 Service accrued for a Vesting Computation Period ending before
                 July 1, 1994, is excluded.

         Period of Military Duty included:

                 A Period of Military Duty shall be included as service with
                 the Employer to the extent it has not already been credited.
                 For purposes of crediting Hours-of-Service during the Period
                 of Military Duty, an Hour-of-Service shall be credited
                 (without regard to the 501 Hour-of-Service limitation) for
                 each hour an Employee would normally have been scheduled to
                 work for the Employer during such period.

         Controlled Group service included:

                 An Employee's service with a member firm of a Controlled Group
                 while both that firm and the Employer were members of the
                 Controlled Group shall be included as service with the
                 Employer.

         YEARLY DATE means July 1, 1994, and each following January 1.

         YEARS OF SERVICE means an Employee's Vesting Service disregarding any
         modifications which exclude service.





ARTICLE I                             20
<PAGE>   21
                                   ARTICLE II

                                 PARTICIPATION

SECTION 2.01--ACTIVE PARTICIPANT.

         (a)     An Employee shall first become an Active Participant (begin
                          active participation in the Plan) on the earliest
                          Monthly Date on or after March 17, 1997, on which he
                          is an Eligible Employee and has met     both of the
                          eligibility requirements set forth below.  This date
                          is his Entry Date.

                 (1)      He has completed one month of Eligibility Service
                          before his Entry Date.

                 (2)      He is age 21 or older.

                 The requirements in items (1) and (2) above are waived for any
                 Carter Crowley Properties employee who transfers and becomes a
                 Crescent Real Estate Equities, Ltd. Employee.  This date shall
                 be an Entry Date if the Eligible Employee has met all the
                 other eligibility requirements.

                 Each Employee who was an Active Participant under the Plan on
                 March 16, 1997, shall continue to be an Active Participant if
                 he is still an Eligible Employee on March 17, 1997, and his
                 Entry Date shall not change.

                 If a person has been an Eligible Employee who has met all the
                 eligibility requirements above, but is not an Eligible
                 Employee on the date which would have been his Entry Date, he
                 shall become an Active Participant on the date he again
                 becomes an Eligible Employee.  This date is his Entry Date.

         (b)     An Inactive Participant shall again become an Active
                 Participant (resume active participation in the Plan) on the
                 date he again performs an Hour-of-Service as an Eligible
                 Employee.  This date is his Reentry Date.

                 Upon again becoming an Active Participant, he shall cease to
                 be an Inactive Participant.

         (c)     A former Participant shall again become an Active Participant
                 (resume active participation in the Plan) on the date he again
                 performs an Hour-of-Service as an Eligible Employee.  This
                 date is his Reentry Date.

         An Employee may, subject to the approval of the Employer, elect
voluntarily not to participate in the Plan.  The election not to participate
must be communicated to the Employer, in writing, at least 30 days before the
beginning of the Plan Year.

         There shall be no duplication of benefits for a Participant under this
Plan because of more than one period as an Active Participant.





ARTICLE II                              21
<PAGE>   22
                                  ARTICLE III

                                 CONTRIBUTIONS

SECTION 3.01--EMPLOYER CONTRIBUTIONS.

         Employer Contributions for Plan Years which end on or after March 17,
1997, may be made without regard to current or accumulated net income,
earnings, or profits of the Employer.  Notwithstanding the foregoing, the Plan
shall continue to be designed to qualify as a profit sharing plan for purposes
of Code Sections 401(a), 402, 412, and 417.  Such Contributions will be equal
to the Employer Contributions as described below:

         (a)     The amount of each Elective Deferral Contribution for a
                 Participant shall be equal to any percentage (not less than 1%
                 nor more than 15%) of his Compensation for the pay period as
                 elected in his elective deferral agreement.  An Employee who
                 is eligible to participate in the Plan may file an elective
                 deferral agreement with the Employer.  The elective deferral
                 agreement to start Elective Deferral Contributions may be
                 effective on a Participant's Entry Date (Reentry Date, if
                 applicable) or any following Quarterly Date.  The Participant
                 shall make any change or terminate the elective deferral
                 agreement by filing a new elective deferral agreement.  A
                 Participant's elective deferral agreement making a change may
                 be effective on any date an elective deferral agreement to
                 start Elective Deferral Contributions could be effective.  A
                 Participant's elective deferral agreement to stop Elective
                 Deferral Contributions may be effective on any date.  The
                 elective deferral agreement must be in writing and effective
                 before the beginning of the pay period in which Elective
                 Deferral Contributions are to start, change or stop.

                 Elective Deferral Contributions are fully (100%) vested and
                 nonforfeitable.

         (b)     The amount of each Matching Contribution for a Participant
                 eligible for an allocation shall be equal to a percentage as
                 determined by the Employer of the Elective Deferral
                 Contributions made for him for the Matching Contribution
                 period, disregarding any Elective Deferral Contributions in
                 excess of 4% of his Compensation for the Matching Contribution
                 period.  The Matching Contribution period  may be a month,
                 quarter, half-year, or year as determined by the Employer.

                 Matching Contributions are subject to the Vesting Percentage.

         (c)     The amount of each Qualified Nonelective Contribution shall be
                 determined by the Employer.  A Qualified Nonelective
                 Contribution shall be made for a Participant only if he is a
                 Nonhighly Compensated Employee or a Non-key Employee (as
                 defined in Article X).

                 Qualified Nonelective Contributions are fully (100%) vested
                 and nonforfeitable.

         (d)     The amount of each Discretionary Contribution shall be
                 determined by the Employer.

                 Discretionary Contributions are subject to the Vesting
                 Percentage.

         No Participant shall be permitted to have Elective Deferral
Contributions, as defined in the EXCESS AMOUNTS SECTION of Article III, made
under this Plan, or any other qualified plan maintained by the Employer, 





ARTICLE III                        22
<PAGE>   23
during any taxable year, in excess of the dollar limitation contained in Code
Section 402(g) in effect at the beginning of such taxable year.

         The Employer shall pay to the Trustee its Contributions used to
determine the Actual Deferral Percentage, as defined in the EXCESS AMOUNTS
SECTION of Article III, to the Plan for each Plan Year not later than the end of
the twelve-month period immediately following the Plan Year for which they are
deemed to be paid.  Any such Contributions accumulated through payroll
deductions shall be paid to the Trustee as soon as administratively practicable
and in no event later than the 15th business day of the month after the month in
which such amounts  otherwise would have been paid to the Participant.

         A portion of the Plan assets resulting from Employer Contributions
(but not more than the original amount of those Contributions) may be returned
if the Employer Contributions are made because of a mistake of fact or are more
than the amount deductible under Code Section 404 (excluding any amount which
is not deductible because the Plan is disqualified).  The amount involved must
be returned to the Employer within one year after the date the Employer
Contributions are made by mistake of fact or the date the deduction is
disallowed, whichever applies.  Except as provided under this paragraph and
Article VII, the assets of the Plan shall never be used for the benefit of the
Employer and are held for the exclusive purpose of providing benefits to
Participants and their Beneficiaries and for defraying reasonable expenses of
administering the Plan.

SECTION 3.01A--ROLLOVER CONTRIBUTIONS.

         A Rollover Contribution may be made by or for an Eligible Employee if
the following conditions are met:

         (a)     The Contribution is a rollover contribution which the Code
                 permits to be transferred to a plan that meets the
                 requirements of Code Section 401(a).

         (b)     If the Contribution is made by the Eligible Employee, it is
                 made within sixty days after he receives the distribution.

         (c)     The Eligible Employee furnishes evidence satisfactory to the
                 Plan Administrator that the proposed transfer is in fact a
                 rollover contribution that meets conditions (a) and (b) above.

         The Rollover Contribution may be made by the Eligible Employee or the
Eligible Employee may direct the trustee or named fiduciary of another plan to
transfer the funds which would otherwise be a Rollover Contribution directly to
this Plan.  Such transferred funds shall be called a Rollover Contribution.
The Contribution shall be made according to procedures set up by the Plan
Administrator.

         If the Eligible Employee is not an Active Participant at the time the
Rollover Contribution is made, he shall be deemed to be a Participant only for
the purposes of investment and distribution of the Rollover Contribution.  He
shall not share in the allocation of Employer Contributions until the time he
meets all the requirements to become an Active Participant.

         Rollover Contributions made by or for an Eligible Employee shall be
credited to his Account.  The part of the Participant's Account resulting from
Rollover Contributions is fully (100%) vested and nonforfeitable at all times.
A separate accounting record shall be maintained for that part of his Rollover
Contribution which consists of voluntary contributions that were deducted from
the Participant's gross income for Federal income tax purposes.

SECTION 3.02--FORFEITURES.

         The Nonvested Account of a Participant shall be forfeited as of the
earlier of the following:  the date of the Participant's death, if prior to
such date he had ceased to be an Employee; or his Forfeiture Date.  All or a





ARTICLE III                        23
<PAGE>   24
part of  a Participant's Nonvested Account will be forfeited if, after he
ceases to be an Employee, he receives a distribution of his entire Vested
Account or a distribution of his Vested Account derived from Employer
Contributions which were not 100% vested when made according to the provisions
of the VESTED BENEFITS SECTION of Article V or the SMALL AMOUNTS SECTION of
Article IX.  If a Participant's Vested Account is zero on the date he ceases to
be an Employee, he shall be deemed to have received a distribution of his
entire Vested Account on such date.  The forfeiture will occur as of the date
he receives the distribution or on the date such provision became effective, if
later. If he receives a distribution of his entire Vested Account, his entire
Nonvested Account will be forfeited.  If he receives a distribution of his
Vested Account from Employer Contributions which were not 100% vested when
made, but less than his entire Vested Account, the amount to be forfeited will
be determined by multiplying his Nonvested Account by a fraction.  The
numerator of the fraction is the amount of the distribution derived from
Employer Contributions which were not 100% vested when made and the denominator
of the fraction is his entire Vested Account derived from such Employer
Contributions on the date of distribution.

         A Forfeiture shall also occur as described in the EXCESS AMOUNTS
SECTION of Article III.

         Forfeitures may first be applied to pay expenses under the Plan which
would otherwise be paid by the Employer.

         Forfeitures not used to pay expenses shall be applied to reduce the
earliest Employer Contributions made after the Forfeitures are determined.
Forfeitures shall be determined at least once during each taxable year of the
Employer.  Upon their application, such Forfeitures shall be deemed to be
Employer Contributions.

         Forfeitures of Matching Contributions which relate to excess amounts
shall be applied as provided in the EXCESS AMOUNTS SECTION of Article III.

         If a Participant again becomes an Eligible Employee after receiving a
distribution which caused his Nonvested Account to be forfeited, he shall have
the right to repay to the Plan the entire amount of the distribution he
received (excluding any amount of such distribution resulting from
Contributions which were 100% vested when made).  The repayment must be made
before the earlier of the date five years after the date he again becomes an
Eligible Employee or the end of the first period of five consecutive Vesting
Breaks in Service which begin after the date of the distribution.

         If the Participant makes the repayment provided above, the Plan
Administrator shall restore to his Account an amount equal to his Nonvested
Account which was forfeited on the date of distribution, unadjusted for any
investment gains or losses.  If the amount of the repayment is zero dollars
because the Participant was deemed to have received a distribution or the plan
did not have repayment provisions in effect on the date the distribution was
made and he again performs an Hour-of-Service as an Eligible Employee within
the repayment period, the Plan Administrator shall restore the Participant's
Account as if he had made a required repayment on the date he performed such
Hour-of-Service.  Restoration of the Participant's Account shall include
restoration of all Code Section 411(d)(6) protected benefits with respect to
that restored Account, according to applicable Treasury regulations.  Provided,
however, the Plan Administrator shall not restore the Nonvested Account if a
Forfeiture Date has occurred after the date of the distribution and on or
before the date of repayment and that Forfeiture Date would result in a
complete forfeiture of the amount the Plan Administrator would otherwise
restore.

         The Plan Administrator shall restore the Participant's Account by the
close of the Plan Year following the Plan Year in which repayment is made.
Permissible sources for restoration are Forfeitures or Employer Contributions.
The Employer shall contribute, without regard to any requirement or condition
of the EMPLOYER





ARTICLE III                          24
<PAGE>   25
CONTRIBUTIONS SECTION of Article III, such additional amount needed to make the
required restoration.  The repaid and restored amounts are not included in the
Participant's Annual Addition, as defined in the CONTRIBUTION LIMITATION
SECTION of Article III.

SECTION 3.03--ALLOCATION.

         The following Contributions for the Plan Year shall be allocated among
all eligible persons:

         Qualified Nonelective Contributions
         Discretionary Contributions

         The eligible persons are all Participants and former Participants who
(i) are Active Participants on the last day of the Plan Year and had 1,000 or
more Hours-of-Service in the Accrual Computation Period that ends in the Plan
Year or (ii) were Active Participants at any time in the Plan Year and have
died, retired or become Totally and Permanently Disabled.  The amount allocated
to such a person shall be determined below and under Article X.

         The following Contributions for each Plan Year shall be allocated to
each Participant for whom such Contributions were made under the EMPLOYER
CONTRIBUTIONS SECTION of Article III:

         Elective Deferral Contributions
         Matching Contributions

         These Contributions shall be allocated when made and credited to the
Participant's Account.

         The following Contributions are allocated as of the last day of the
Plan Year to each eligible person for whom they are made and credited to his
Account:

         Qualified Nonelective Contributions are allocated as of the last day
of each Plan Year.  For purposes of this allocation, only Nonhighly Compensated
Employees and Non-key Employees (as defined in Article X) shall be eligible
persons.  The amount allocated to each eligible person for the Plan Year shall
be equal to Qualified Nonelective Contributions for the Plan Year, multiplied
by the ratio of (a) his Annual Compensation as of the last day of the Plan Year
to (b) the total of such compensation for all eligible persons.  This amount is
credited to his Account.

         Discretionary Contributions are allocated as of the last day of each
Plan Year.  The amount allocated to each eligible person for the Plan Year
shall be equal to the Discretionary Contributions for the Plan Year, multiplied
by the ratio of (a) his Annual Compensation as of the last day of the Plan Year
to (b) the total of such compensation for all eligible persons.  This amount is
credited to his Account.

         Notwithstanding anything to the contrary, if this is a Plan that would
otherwise fail to meet the requirements of Code Sections 401(a)(26), 410(b)(1)
or 410(b)(2)(A)(i) and the Regulations thereunder because Employer
Contributions would not be allocated to a sufficient number or percentage of
Participants for a Plan Year, then the following rules shall apply:

         (1)     The group of Participants eligible to share in the Employer's
                 Contribution for the Plan Year shall be expanded to include
                 the minimum number of Participants who would not otherwise be
                 eligible as are necessary to satisfy the applicable test.  The
                 specific Participants who shall become eligible





ARTICLE III                         25
<PAGE>   26
                 under the terms of this paragraph shall be those who are
                 actively employed on the last day of the Plan Year and, when
                 compared to similarly situated Participants, have completed
                 the greatest number of Hours of Service in the Plan Year.

         (2)     If after application of paragraph (1) above, the applicable
                 test is still not satisfied, then the group of Participants
                 eligible to share in the Employer's Contribution for the Plan
                 Year shall be further expanded to include the minimum number
                 of Participants who are not actively employed on the last day
                 of the Plan Year as are necessary to satisfy the applicable
                 test.  The specific Participants who shall become eligible to
                 share shall be those Participants, when compared to similarly
                 situated Participants, who have completed the greatest number
                 of Hours-of-Service in the Plan Year before terminating
                 employment.

         In determining the amount of Employer Contributions to be allocated to
a Participant who is a Leased Employee, contributions and benefits provided by
the leasing organization which are attributable to services such Leased
Employee performs for the Employer shall be treated as provided by the Employer
and there shall be no duplication of those contributions or benefits under this
Plan.

SECTION 3.04--CONTRIBUTION LIMITATION.

         (a)     For the purpose of determining the contribution limitation set
                 forth in this section, the following terms are defined:

                 Aggregate Annual Addition means, for a Participant with
                 respect to any Limitation Year, the sum of his Annual
                 Additions under all defined contribution plans of the
                 Employer, as defined in this section, for such Limitation
                 Year.  The nondeductible participant contributions which the
                 Participant makes to a defined benefit plan shall be treated
                 as Annual Additions to a defined contribution plan.  The
                 Contributions the Employer, as defined in this section, made
                 for the Participant for a Plan Year beginning on or after
                 March 31, 1984, to an individual medical benefit account, as
                 defined in Code Section 415(l)(2), under a pension or annuity
                 plan of the Employer, as defined in this section, shall be
                 treated as Annual Additions to a defined contribution plan.
                 Also, amounts derived from contributions paid or accrued after
                 December 31, 1985, in Fiscal Years ending after such date,
                 which are attributable to post-retirement medical benefits
                 allocated to the separate account of a key employee, as
                 defined in Code Section 419A(d)(3), under a welfare benefit
                 fund, as defined in Code Section 419(e), maintained by the
                 Employer, as defined in this section, are treated as Annual
                 Additions to a defined contribution plan.  The 25% of
                 Compensation limit under Maximum Permissible Amount does not
                 apply to Annual Additions resulting from contributions made to
                 an individual medical account, as defined in Code Section
                 415(l)(2), or to Annual Additions resulting from contributions
                 for medical benefits, within the meaning of Code Section 419A,
                 after separation from service.

                 Annual Addition means the amount added to a Participant's
                 account for any Limitation Year which may not exceed the
                 Maximum Permissible Amount.  The Annual Addition under any
                 plan for a Participant with respect to any Limitation Year,
                 shall be equal to the sum of (1) and (2) below:

                 (1)      Employer contributions and forfeitures credited to
                          his account for the Limitation Year.

                 (2)      Participant contributions made by him for the
                          Limitation Year.





ARTICLE III                         26
<PAGE>   27
                 Before the first Limitation Year beginning after December 31,
         1986, the amount under (2) above is the lesser of (i) 1/2 of his
         nondeductible participant contributions made for the Limitation Year,
         or (ii) the amount, if any, of his nondeductible participant
         contributions made for the Limitation Year which is in excess of six
         percent of his Compensation, as defined in this section, for such
         Limitation Year.

                 Compensation means all wages for Federal income tax
                 withholding purposes, as defined under Code Section 3401(a)
                 (for purposes of income tax withholding at the source),
                 disregarding any rules limiting the remuneration included as
                 wages based on the nature or location of the employment or the
                 services performed.

                 For any self-employed individual Compensation will mean earned
                 income.

                 For purposes of applying the limitations of this section,
                 Compensation for a Limitation Year is the Compensation
                 actually paid or made available during such Limitation Year.

                 Defined Benefit Plan Fraction means, with respect to a
                 Limitation Year for a Participant who is or has been a
                 participant in a defined benefit plan ever maintained by the
                 Employer, as defined in this section, the quotient, expressed
                 as a decimal, of

                 (1)      the Participant's Projected Annual Benefit under all
                          such plans as of the close of such Limitation Year,
                          divided by

                 (2)      on and after the TEFRA Compliance Date, the lesser of
                          (i) or (ii) below:

                          (i)     1.25 multiplied by the maximum dollar
                                  limitation which applies to defined benefit
                                  plans determined for the Limitation Year
                                  under Code Sections 415(b) or (d) or

                          (ii)    1.4 multiplied by the Participant's highest
                                  average compensation as defined in the
                                  defined benefit plan(s),

                          including any adjustments under Code Section 415(b).

                          Before the TEFRA Compliance Date, this denominator is
                          the Participant's Projected Annual Benefit as of the
                          close of the Limitation Year if the plan(s) provided
                          the maximum benefit allowable.

                 The Defined Benefit Plan Fraction shall be modified as
                 follows:

                 If the Participant was a participant as of the first day of
                 the first Limitation Year beginning after December 31, 1986,
                 in one or more defined benefit plans maintained by the
                 Employer, as defined in this section, which were in existence
                 on May 6, 1986, the denominator of this fraction will not be
                 less than 125 percent of the sum of the annual benefits under
                 such plans which the Participant had accrued as of the close
                 of the last Limitation Year beginning before January 1, 1987,
                 disregarding any changes in the terms and conditions of the
                 plan after May 5, 1986.  The preceding sentence applies only
                 if the defined benefit plans individually and in the aggregate
                 satisfied the requirements of Code Section 415 for all
                 Limitation Years beginning before January 1, 1987.





ARTICLE III                             27
<PAGE>   28
                 Defined Contribution Plan Fraction means, for a Participant
                 with respect to a Limitation Year, the quotient, expressed as
                 a decimal, of

                 (1)      the Participant's Aggregate Annual Additions for such
                          Limitation Year and all prior Limitation Years, under
                          all defined contribution plans (including the
                          Aggregate Annual Additions attributable to
                          nondeductible accounts under defined benefit plans
                          and attributable to all welfare benefit funds, as
                          defined in Code Section 419(e) and attributable to
                          individual medical accounts, as defined in Code
                          Section 415(l)(2)) ever maintained by the Employer,
                          as defined in this section, divided by

                 (2)      on and after the TEFRA Compliance Date, the sum of
                          the amount determined for the Limitation Year under
                          (i) or (ii) below, whichever is less, and the amounts
                          determined in the same manner for all prior
                          Limitation Years during which he has been an Employee
                          or an employee of a predecessor employer:

                          (i)     1.25 multiplied by the maximum permissible
                                  dollar amount for each such Limitation Year,
                                  or

                          (ii)    1.4 multiplied by the maximum permissible
                                  percentage of the Participant's Compensation,
                                  as defined in this section, for each such
                                  Limitation Year.

                          Before the TEFRA Compliance Date, this denominator is
                          the sum of the maximum allowable amount of Annual
                          Addition to his account(s) under all the plan(s) of
                          the Employer, as defined in this section, for each
                          such Limitation Year.

                 The Defined Contribution Plan Fraction shall be modified as
                 follows:

                 If the Participant was a participant as of the first day of
                 the first Limitation Year beginning after December 31, 1986,
                 in one or more defined contribution plans maintained by the
                 Employer, as defined in this section, which were in existence
                 on May 6, 1986, the numerator of this fraction shall be
                 adjusted if the sum of the Defined Contribution Plan Fraction
                 and Defined Benefit Plan Fraction would otherwise exceed 1.0
                 under the terms of this Plan.  Under the adjustment, the
                 dollar amount determined below shall be permanently subtracted
                 from the numerator of this fraction.  The dollar amount is
                 equal to the excess of the sum of the two fractions, before
                 adjustment, over 1.0 multiplied by the denominator of his
                 Defined Contribution Plan Fraction.  The adjustment is
                 calculated using his Defined Contribution Plan Fraction and
                 Defined Benefit Plan Fraction as they would be computed as of
                 the end of the last Limitation Year beginning before January
                 1, 1987, and disregarding any changes in the terms and
                 conditions of the plan made after May 5, 1986, but using the
                 Code Section 415 limitations applicable to the first
                 Limitation Year beginning on or after January 1, 1987.

                 The Annual Addition for any Limitation Year beginning before
                 January 1, 1987, shall not be recomputed to treat all employee
                 contributions as Annual Additions.

                 For a plan that was in existence on July 1, 1982, for purposes
                 of determining the Defined Contribution Plan Fraction for any
                 Limitation Year ending after December 31, 1982, the Plan
                 Administrator may elect, in accordance with the provisions of
                 Code Section 415, that the





ARTICLE III                            28
<PAGE>   29
                 denominator for each Participant for all Limitation Years
                 ending before January 1, 1983, will be equal to

                 (1)      the Defined Contribution Plan Fraction denominator
                          which would apply for the last Limitation Year ending
                          in 1982 if an election under this paragraph were not
                          made, multiplied by.

                 (2)      a fraction, equal to (i) over (ii) below:

                          (i)     the lesser of (A) $51,875, or (B) 1.4,
                                  multiplied by 25% of the Participant's
                                  Compensation, as defined in this section, for
                                  the Limitation Year ending in 1981;

                          (ii)    the lesser of (A) $41,500, or (B) 25% of the
                                  Participant's Compensation, as defined in
                                  this section, for the Limitation Year ending
                                  in 1981.

                 The election described above is applicable only if the plan
                 administrators under all defined contribution plans of the
                 Employer, as defined in this section, also elect to use the
                 modified fraction.

                 Employer means any employer that adopts this Plan and all
                 Controlled Group members and any other entity required to be
                 aggregated with the employer pursuant to regulations under
                 Code Section 414(o).

                 Limitation Year means the 12-consecutive month period within
                 which it is determined whether or not the limitations of Code
                 Section 415 are exceeded.  Limitation Year means each
                 12-consecutive month period ending on the last day of each
                 Plan Year, including corresponding 12-consecutive month
                 periods before July 1, 1994.  If the Limitation Year is other
                 than the calendar year, execution of this Plan (or any
                 amendment to this Plan changing the Limitation Year)
                 constitutes the Employer's adoption of a written resolution
                 electing the Limitation Year.  If the Limitation Year is
                 changed, the new Limitation Year shall begin within the
                 current Limitation Year, creating a short Limitation Year.

                 Maximum Permissible Amount means, for a Participant with
                 respect to any Limitation Year, the lesser of (1) or (2)
                 below:

                 (1)      The greater of $30,000 or one-fourth of the maximum
                          dollar limitation which applies to defined benefit
                          plans set forth in Code Section 415(b)(1)(A) as in
                          effect for the Limitation Year.  (Before the TEFRA
                          Compliance Date, $25,000 multiplied by the cost of
                          living adjustment factor permitted by Federal
                          regulations.)

                 (2)      25% of his Compensation, as defined in this section,
                          for such Limitation Year.

                 The compensation limitation referred to in (2) shall not apply
                 to any contribution for medical benefits (within the meaning
                 of Code Section 401(h) or Code Section 419A(f)(2)) which is
                 otherwise treated as an annual addition under Code Section
                 415(l)(1) or Code Section 419A(d)(2).

                 If there is a short Limitation Year because of a change in
                 Limitation Year, the Maximum Permissible Amount will not
                 exceed the maximum dollar limitation which would otherwise
                 apply multiplied by the following fraction:

                        Number of months in the short Limitation Year
                        ---------------------------------------------
                                              12

                 Projected Annual Benefit means a Participant's expected annual
                 benefit under all defined benefit plan(s) ever maintained by
                 the Employer, as defined in this section.  The Projected
                 Annual Benefit





ARTICLE III                                29
<PAGE>   30
                 shall be determined assuming that the Participant will
                 continue employment until the later of current age or normal
                 retirement age under such plan(s), and that the Participant's
                 compensation for the current Limitation Year and all other
                 relevant factors used to determine benefits under such plan(s)
                 will remain constant for all future Limitation Years.  Such
                 expected annual benefit shall be adjusted to the actuarial
                 equivalent of a straight life annuity if expressed in a form
                 other than a straight life or qualified joint and survivor
                 annuity.

         (b)     The Annual Addition under this Plan for a Participant during a
                 Limitation Year shall not be more than the Maximum Permissible
                 Amount.

         (c)     Contributions which would otherwise be credited to the
                 Participant's Account shall be limited or reallocated to the
                 extent necessary to meet the restrictions of subparagraph (b)
                 above for any Limitation Year in the following order.
                 Discretionary Contributions shall be reallocated in the same
                 manner as described in the ALLOCATION SECTION of Article III
                 to the remaining Participants to whom the limitations do not
                 apply for the Limitation Year.  The Discretionary
                 Contributions shall be limited if there are no such remaining
                 Participants.  Qualified Nonelective Contributions shall be
                 reallocated in the same manner as described in the ALLOCATION
                 SECTION of Article III to the remaining Participants to whom
                 the limitations do not apply for the Limitation Year.  The
                 Qualified Nonelective Contributions shall be limited if there
                 are no such remaining Participants.  Elective Deferral
                 Contributions that are not the basis for Matching
                 Contributions shall be limited.  Matching Contributions shall
                 be limited to the extent necessary to limit the Participant's
                 Annual Addition under this Plan to his maximum amount.  If
                 Matching Contributions are limited because of this limit,
                 Elective Deferral Contributions that are the basis for
                 Matching Contributions shall be reduced in proportion.

                 If, due to (i) an error in estimating a Participant's
                 Compensation as defined in this section, (ii) because the
                 amount of the Forfeitures to be used to offset Employer
                 Contributions is more than the amount of the Employer
                 Contributions due for the remaining Participants, (iii) as a
                 result of a reasonable error in determining the amount of
                 elective deferrals (within the meaning of Code Section
                 402(g)(3)) that may be made with respect to any individual
                 under the limits of Code Section 415, or (iv) other limited
                 facts and circumstances, a Participant's Annual Addition is
                 greater than the amount permitted in (b) above, such excess
                 amount shall be applied as follows.  Matching Contributions
                 based on Elective Deferral Contributions which are returned
                 shall be forfeited.  If after the return of Elective Deferral
                 Contributions, an excess amount still exists, and the
                 Participant is an Active Participant as of the end of the
                 Limitation Year, the excess amount shall be used to offset
                 Employer Contributions for him in the next Limitation Year.
                 If after the return of Elective Deferral Contributions, an
                 excess amount still exists, and the Participant is not an
                 Active Participant as of the end of the Limitation Year, the
                 excess amount will be held in a suspense account which will be
                 used to offset Employer Contributions for all Participants in
                 the next Limitation Year.  No Employer Contributions that
                 would be included in the next Limitation Year's Annual
                 Addition may be made before the total suspense account has
                 been used.





ARTICLE III                             30
<PAGE>   31
         (d)     A Participant's Aggregate Annual Addition for a Limitation
                 Year shall not exceed the Maximum Permissible Amount.

                 If, for the Limitation Year, the Participant has an Annual
                 Addition under more than one defined contribution plan or a
                 welfare benefit fund, as defined in Code Section 419(e), or an
                 individual medical account, as defined in Code Section
                 415(l)(2), maintained by the Employer, as defined in this
                 section, and such plans and welfare benefit funds and
                 individual medical accounts do not otherwise limit the
                 Aggregate Annual Addition to the Maximum Permissible Amount,
                 any reduction necessary shall be made first to the profit
                 sharing plans, then to all other such plans and welfare
                 benefit funds and individual medical accounts and, if
                 necessary, by reducing first those that were most recently
                 allocated.  Welfare benefit funds and individual medical
                 accounts shall be deemed to be allocated first.  However,
                 elective deferral contributions shall be the last
                 contributions reduced before the welfare benefit fund or
                 individual medical account is reduced.

                 If some of the Employer's defined contribution plans were not
                 in existence on July 1, 1982, and some were in existence on
                 that date, the Maximum Permissible Amount which is based on a
                 dollar amount may differ for a Limitation Year.  The Aggregate
                 Annual Addition for the Limitation Year in which the dollar
                 limit differs shall not exceed the lesser of (1) 25% of
                 Compensation as defined in this section, (2) $45,475, or (3)
                 the greater of $30,000 or the sum of the Annual Additions for
                 such Limitation Year under all the plan(s) to which the
                 $45,475 amount applies.

         (e)     If a Participant is or has been a participant in both defined
                 benefit and defined contribution plans (including a welfare
                 benefit fund or individual medical account) ever maintained by
                 the Employer, as defined in this section, the sum of the
                 Defined Benefit Plan Fraction and the Defined Contribution
                 Plan Fraction for any Limitation Year shall not exceed 1.0
                 (1.4 before the TEFRA Compliance Date).

                 After all other limitations set out in the plans and funds
                 have been applied, the following limitations shall apply so
                 that the sum of the Participant's Defined Benefit Plan
                 Fraction and Defined Contribution Plan Fraction shall not
                 exceed 1.0 (1.4 before the TEFRA Compliance Date).  The
                 Projected Annual Benefit shall be limited first.  If the
                 Participant's annual benefit(s) equal his Projected Annual
                 Benefit, as limited, then Annual Additions to the defined
                 contribution plan(s) shall be limited to the extent needed to
                 reduce the sum to 1.0 (1.4).  First, the voluntary
                 contributions the Participant may make for the Limitation Year
                 shall be limited.  Next, in the case of a profit sharing plan,
                 any forfeitures allocated to the Participant shall be
                 reallocated to remaining participants to the extent necessary
                 to reduce the decimal to 1.0 (1.4).  Last, to the extent
                 necessary, employer contributions for the Limitation Year
                 shall be reallocated or limited, and any required and optional
                 employee contributions to which such employer contributions
                 were geared shall be reduced in proportion.

                 If, for the Limitation Year, the Participant has an Annual
                 Addition under more than one defined contribution plan or
                 welfare benefit fund or individual medical account maintained
                 by the Employer, as defined in this section, any reduction
                 above shall be made first to the profit sharing plans, then to
                 all other such plans and welfare benefit plans and individual
                 medical accounts and, if necessary, by reducing first those
                 that were most recently allocated.  However, elective deferral
                 contributions shall be the last contributions reduced before
                 the welfare benefit fund or individual medical account is
                 reduced.  The annual addition to the welfare benefit fund and
                 individual medical account shall be limited last.





ARTICLE III                          31
<PAGE>   32
SECTION 3.05--EXCESS AMOUNTS.

         (a)     For the purposes of this section, the following terms are
                 defined:

                 Actual Deferral Percentage means the ratio (expressed as a
                 percentage) of Elective Deferrall Contributions under this
                 Plan on behalf of the Eligible Participant for the Plan Year
                 to the Eligible Participant's Compensation for the Plan Year.
                 In modification of the foregoing, Compensation shall be
                 limited to the Compensation received while an Active
                 Participant.  The Elective Deferral Contributions used to
                 determine the Actual Deferral Percentage shall include Excess
                 Elective Deferrals (other than Excess Elective Deferrals of
                 Nonhighly Compensated Employees that arise solely from
                 Elective Deferral Contributions made under this Plan or any
                 other plans of the Employer or a Controlled Group member), but
                 shall exclude Elective Deferral Contributions that are used in
                 computing the Contribution Percentage (provided the Average
                 Actual Deferral Percentage test is satisfied both with and
                 without exclusion of these Elective Deferral Contributions).
                 Under such rules as the Secretary of the Treasury shall
                 prescribe in Code Section 401(k)(3)(D), the Employer may elect
                 to include Qualified Nonelective Contributions and Qualified
                 Matching Contributions under this Plan in computing the Actual
                 Deferral Percentage.  For an Eligible Participant for whom
                 such Contributions on his behalf for the Plan Year are zero,
                 the percentage is zero.

                 Aggregate Limit means the greater of (1) or (2) below:

                 (1)      The sum of

                          (i)     125 percent of the greater of the Average
                                  Actual Deferral Percentage of the Nonhighly
                                  Compensated Employees for the Plan Year or
                                  the Average Contribution Percentage of
                                  Nonhighly Compensated Employees under the
                                  Plan subject to Code Section 401(m) for the
                                  Plan Year beginning with or within the Plan
                                  Year of the cash or deferred arrangement and

                          (ii)    the lesser of 200% or two plus the lesser of
                                  such Average Actual Deferral Percentage or
                                  Average Contribution Percentage.

                 (2)      The sum of

                          (i)     125 percent of the lesser of the Average
                                  Actual Deferral Percentage of the Nonhighly
                                  Compensated Employees for the Plan Year or
                                  the Average Contribution Percentage of
                                  Nonhighly Compensated Employees under the
                                  Plan subject to Code Section 401(m) for the
                                  Plan Year beginning with or within the Plan
                                  Year of the cash or deferred arrangement and

                          (ii)    the lesser of 200% or two plus the greater of
                                  such Average Actual Deferral Percentage or
                                  Average Contribution Percentage.

                 Average Actual Deferral Percentage means the average
                 (expressed as a percentage) of the Actual Deferral Percentages
                 of the Eligible Participants in a group.

                 Average Contribution Percentage means the average (expressed
                 as a percentage) of the Contribution Percentages of the
                 Eligible Participants in a group.

                 Contribution Percentage means the ratio (expressed as a
                 percentage) of the Eligible Participant's Contribution
                 Percentage Amounts to the Eligible Participant's Compensation
                 for the Plan Year.  In





ARTICLE III                               32
<PAGE>   33
                 modification of the foregoing, Compensation shall be limited
                 to the Compensation received while an Active Participant.  For
                 an Eligible Participant for whom such Contribution Percentage
                 Amounts for the Plan Year are zero, the percentage is zero.

                 Contribution Percentage Amounts means the sum of the
                 Participant Contributions and Matching Contributions (that are
                 not Qualified Matching Contributions) under this Plan on
                 behalf of the Eligible Participant for the Plan Year.  Such
                 Contribution Percentage Amounts shall not include Matching
                 Contributions that are forfeited either to correct Excess
                 Aggregate Contributions or because the Contributions to which
                 they relate are Excess Elective Deferrals, Excess
                 Contributions or Excess Aggregate Contributions.  Under such
                 rules as the Secretary of the Treasury shall prescribe in Code
                 Section 401(k)(3)(D), the Employer may elect to include
                 Qualified Nonelective Contributions and Qualified Matching
                 Contributions under this Plan which were not used in computing
                 the Actual Deferral Percentage in computing the Contribution
                 Percentage.  The Employer may also elect to use Elective
                 Deferral Contributions in computing the Contribution
                 Percentage so long as the Average Actual Deferral Percentage
                 test is met before the Elective Deferral Contributions are
                 used in the Average Contribution Percentage test and continues
                 to be met following the exclusion of those Elective Deferral
                 Contributions that are used to meet the Average Contribution
                 Percentage test.

                 Elective Deferral Contributions means employer contributions
                 made on behalf of a participant pursuant to an election to
                 defer under any qualified cash or deferred arrangement as
                 described in Code Section 401(k), any simplified employee
                 pension cash or deferred arrangement as described in Code
                 Section 402(h)(1)(B), any eligible deferred compensation plan
                 under Code Section 457, any plan as described under Code
                 Section 501(c)(18), and any employer contributions made on
                 behalf of a participant for the purchase of an annuity
                 contract under Code Section 403(b) pursuant to a salary
                 reduction agreement.  Elective Deferral Contributions shall
                 not include any deferrals properly distributed as excess
                 Annual Additions.

                 Eligible Participant means, for purposes of the Actual
                 Deferral Percentage, any Employee who is eligible to make an
                 Elective Deferral Contribution, and shall include the
                 following:  any Employee who would be a plan participant if he
                 chose to make required contributions; any Employee who can
                 make Elective Deferral Contributions but who has changed the
                 amount of his Elective Deferral Contribution to 0%, or whose
                 eligibility to make an Elective Deferral Contribution is
                 suspended because of a loan, distribution or hardship
                 withdrawal; and, any Employee who is not able to make an
                 Elective Deferral Contribution because of Code Section
                 415(c)(1) - Annual Additions limits.  The Actual Deferral
                 Percentage for any such included Employee is zero.

                 Eligible Participant means, for purposes of the Average
                 Contribution Percentage, any Employee who is eligible to make
                 a Participant Contribution or to receive a Matching
                 Contribution, and shall include the following:  any Employee
                 who would be a plan participant if he chose to make required
                 contributions; any Employee who can make a Participant
                 Contribution or receive a matching contribution but who has
                 made an election not to participate in the Plan; and any
                 Employee who is not able to make a Participant Contribution or
                 receive a matching contribution because of Code Section
                 415(c)(1) or 415(e) limits.  The Average Contribution
                 Percentage for any such included Employee is zero.

                 Excess Aggregate Contributions means, with respect to any Plan
                 Year, the excess of:

                 (1)      The aggregate Contributions taken into account in
                          computing the numerator of the Contribution
                          Percentage actually made on behalf of Highly
                          Compensated Employees for such Plan Year, over

                 (2)      The maximum amount of such Contributions permitted by
                          the Average Contribution





ARTICLE III                           33
<PAGE>   34
                          Percentage test (determined by reducing Contributions
                          made on behalf of Highly Compensated Employees in
                          order of their Contribution Percentages beginning
                          with the highest of such percentages).

                 Such determination shall be made after first determining
                 Excess Elective Deferrals and then determining Excess
                 Contributions.

                 Excess Contributions means, with respect to any Plan Year, the
                 excess of:

                 (1)      The aggregate amount of Contributions actually taken
                          into account in computing the Actual Deferral
                          Percentage of Highly Compensated Employees for such
                          Plan Year, over

                 (2)      The maximum amount of such Contributions permitted by
                          the Actual Deferral Percentage test (determined by
                          reducing Contributions made on behalf of Highly
                          Compensated Employees in order of the Actual Deferral
                          Percentages, beginning with the highest of such
                          percentages).

                 A Participant's Excess Contributions for a Plan Year will be
                 reduced by the amount of Excess Elective Deferrals, if any,
                 previously distributed to the Participant for the taxable year
                 ending in that Plan Year.

                 Excess Elective Deferrals means those Elective Deferral
                 Contributions that are includible in a Participant's gross
                 income under Code Section 402(g) to the extent such
                 Participant's Elective Deferral Contributions for a taxable
                 year exceed the dollar limitation under such Code section.
                 Excess Elective Deferrals shall be treated as Annual
                 Additions, as defined in the CONTRIBUTION LIMITATION SECTION
                 of Article III, under the Plan, unless such amounts are
                 distributed no later than the first April 15 following the
                 close of the Participant's taxable year.

                 Matching Contributions means employer contributions made to
                 this or any other defined contribution plan, or to a contract
                 described in Code Section 403(b), on behalf of a participant
                 on account of a Participant Contribution made by such
                 participant, or on account of a participant's Elective
                 Deferral Contributions, under a plan maintained by the
                 employer.

                 Participant Contributions means contributions made to any plan
                 by or on behalf of a participant that are included in the
                 participant's gross income in the year in which made and that
                 are maintained under a separate account to which earnings and
                 losses are allocated.

                 Qualified Matching Contributions means Matching Contributions
                 which are subject to the distribution and nonforfeitability
                 requirements under Code Section 401(k) when made.

                 Qualified Nonelective Contributions means any employer
                 contributions (other than Matching Contributions) which an
                 employee may not elect to have paid to him in cash instead of
                 being contributed to the plan and which are subject to the
                 distribution and nonforfeitability requirements under Code
                 Section 401(k).

         (b)     A Participant may assign to this Plan any Excess Elective
                 Deferrals made during a taxable year by notifying the Plan
                 Administrator in writing on or before the first following
                 March 1 of the amount of the Excess Elective Deferrals to be
                 assigned to the Plan.  A Participant is deemed to notify the
                 Plan Administrator of any Excess Elective Deferrals that arise
                 by taking into account only those Elective Deferral
                 Contributions made to this Plan and any other plans of the
                 Employer or a Controlled Group member and reducing such Excess
                 Elective Deferrals by the amount of Excess Contributions, if
                 any, previously distributed for the Plan Year beginning in
                 that taxable year.  The Participant's claim for Excess
                 Elective Deferrals shall be accompanied by the Participant's
                 written statement that if such





ARTICLE III                           34
<PAGE>   35
                 amounts are not distributed, such Excess Elective Deferrals,
                 when added to amounts deferred under other plans or
                 arrangements described in Code Sections 401(k), 408(k) or
                 403(b), will exceed the limit imposed on the Participant by
                 Code Section 402(g) for the year in which the deferral
                 occurred.  The Excess Elective Deferrals assigned to this Plan
                 can not exceed the Elective Deferral Contributions allocated
                 under this Plan for such taxable year.

                 Notwithstanding any other provisions of the Plan, Elective
                 Deferral Contributions in an amount equal to the Excess
                 Elective Deferrals assigned to this Plan, plus any income and
                 minus any loss allocable thereto, shall be distributed no
                 later than April 15 to any Participant to whose Account Excess
                 Elective Deferrals were assigned for the preceding year and
                 who claims Excess Elective Deferrals for such taxable year.

                 The income or loss allocable to such Excess Elective Deferrals
                 shall be equal to the income or loss allocable to the
                 Participant's Elective Deferral Contributions for the taxable
                 year in which the excess occurred multiplied by a fraction.
                 The numerator of the fraction is the Excess Elective
                 Deferrals.  The denominator of the fraction is the closing
                 balance without regard to any income or loss occurring during
                 such taxable year (as of the end of such taxable year) of the
                 Participant's Account resulting from Elective Deferral
                 Contributions.

                 Any Matching Contributions which were based on the Elective
                 Deferral Contributions which are distributed as Excess
                 Elective Deferrals, plus any income and minus any loss
                 allocable thereto, shall be forfeited.  These Forfeitures
                 shall be used to offset the earliest Employer Contribution due
                 after the Forfeiture arises.

         (c)     As of the end of each Plan Year after Excess Elective
                 Deferrals have been determined, one of the following tests
                 must be met:

                 (1)      The Average Actual Deferral Percentage for Eligible
                          Participants who are Highly Compensated Employees for
                          the Plan Year is not more than the Average Actual
                          Deferral Percentage for Eligible Participants who are
                          Nonhighly Compensated Employees for the Plan Year
                          multiplied by 1.25.

                 (2)      The Average Actual Deferral Percentage for Eligible
                          Participants who are Highly Compensated Employees for
                          the Plan Year is not more than the Average Actual
                          Deferral Percentage for Eligible Participants who are
                          Nonhighly Compensated Employees for the Plan Year
                          multiplied by 2 and the difference between the
                          Average Actual Deferral Percentages is not more than
                          2.

                 The Actual Deferral Percentage for any Eligible Participant
                 who is a Highly Compensated Employee for the Plan Year and who
                 is eligible to have Elective Deferral Contributions (and
                 Qualified





ARTICLE III                            35
<PAGE>   36
                 Nonelective Contributions or Qualified Matching
                 Contributions, or both, if used in computing the Actual
                 Deferral Percentage) allocated to his account under two or
                 more plans or arrangements described in Code Section 401(k)
                 that are maintained by the Employer or a Controlled Group
                 member shall be determined as if all such Elective Deferral
                 Contributions (and, if applicable, such Qualified Nonelective
                 Contributions or Qualified Matching Contributions, or both)
                 were made under a single arrangement.  If a Highly Compensated
                 Employee participates in two or more cash or deferred
                 arrangements that have different Plan Years, all cash or
                 deferred arrangements ending with or within the same calendar
                 year shall be treated as a single arrangement.
                 Notwithstanding the foregoing, certain plans shall be treated
                 as separate if mandatorily disaggregated under the regulations
                 under Code Section 401(k).

                 In the event that this Plan satisfies the requirements of Code
                 Sections 401(k), 401(a)(4), or 410(b) only if aggregated with
                 one or more other plans, or if one or more other plans satisfy
                 the requirements of such Code sections only if aggregated with
                 this Plan, then this section shall be applied by determining
                 the Actual Deferral Percentage of employees as if all such
                 plans were a single plan.  Plans may be aggregated in order to
                 satisfy Code Section 401(k) only if they have the same Plan
                 Year.

                 For purposes of determining the Actual Deferral Percentage of
                 an Eligible Participant who is a five-percent owner or one of
                 the ten most highly-paid Highly Compensated Employees, the
                 Elective Deferral Contributions (and Qualified Nonelective
                 Contributions or Qualified Matching Contributions, or both, if
                 used in computing the Actual Deferral Percentage) and
                 Compensation of such Eligible Participant include the Elective
                 Deferral Contributions (and, if applicable, Qualified
                 Nonelective Contributions or Qualified Matching Contributions,
                 or both) and Compensation for the Plan Year of Family Members.
                 Family Members, with respect to such Highly Compensated
                 Employees, shall be disregarded as separate employees in
                 determining the Actual Deferral Percentage both for
                 Participants who are Nonhighly Compensated Employees and for
                 Participants who are Highly Compensated Employees.

                 For purposes of determining the Actual Deferral Percentage,
                 Elective Deferral Contributions, Qualified Nonelective
                 Contributions and Qualified Matching Contributions must be
                 made before the last day of the 12-month period immediately
                 following the Plan Year to which contributions relate.

                 The Employer shall maintain records sufficient to demonstrate
                 satisfaction of the Average Actual Deferral Percentage test
                 and the amount of Qualified Nonelective Contributions or
                 Qualified Matching Contributions, or both, used in such test.

                 The determination and treatment of the Contributions used in
                 computing the Actual Deferral Percentage shall satisfy such
                 other requirements as may be prescribed by the Secretary of
                 the Treasury.

                 If the Plan Administrator should determine during the Plan
                 Year that neither of the above tests is being met, the Plan
                 Administrator may adjust the amount of future Elective
                 Deferral Contributions of the Highly Compensated Employees.

                 Notwithstanding any other provisions of this Plan, Excess
                 Contributions, plus any income and minus any loss allocable
                 thereto, shall be distributed no later than the last day of
                 each Plan Year to Participants to whose Accounts such Excess
                 Contributions were allocated for the preceding Plan





ARTICLE III                             36
<PAGE>   37
                 Year.  If such excess amounts are distributed more than 2 1/2
                 months after the last day of the Plan Year in which such
                 excess amounts arose, a ten (10) percent excise tax will be
                 imposed on the employer maintaining the plan with respect to
                 such amounts.  Such distributions shall be made beginning with
                 the Highly Compensated Employee(s) who has the greatest Actual
                 Deferral Percentage, reducing his Actual Deferral Percentage
                 to the next highest Actual Deferral Percentage level.  Then,
                 if necessary, reducing the Actual Deferral Percentage of the
                 Highly Compensated Employees at the next highest level, and
                 continuing in this manner until the average Actual Deferral
                 Percentage of the Highly Compensated Group satisfies the
                 Actual Deferral Percentage test.  Excess Contributions of
                 Participants who are subject to the family member aggregation
                 rules shall be allocated among the Family Members in
                 proportion to the Elective Deferral Contributions (and amounts
                 treated as Elective Deferral Contributions) of each Family
                 Member that is combined to determine the combined Actual
                 Deferral Percentage.

                 Excess Contributions shall be treated as Annual Additions, as
                 defined in the CONTRIBUTION LIMITATION SECTION of Article III,
                 under the Plan.

                 The Excess Contributions shall be adjusted for income or loss.
                 The income or loss allocable to such Excess Contributions
                 shall be equal to the income or loss allocable to the
                 Participant's Elective Deferral Contributions (and, if
                 applicable, Qualified Nonelective Contributions or Qualified
                 Matching Contributions, or both) for the Plan Year in which
                 the excess occurred multiplied by a fraction.  The numerator
                 of the fraction is the Excess Contributions.  The denominator
                 of the fraction is the closing balance without regard to any
                 income or loss occurring during such Plan Year (as of the end
                 of such Plan Year) of the Participant's Account resulting from
                 Elective Deferral Contributions (and Qualified Nonelective
                 Contributions or Qualified Matching Contributions, or both, if
                 used in computing the Actual Deferral Percentage).

                 Excess Contributions shall be distributed from the
                 Participant's Account resulting from Elective Deferral
                 Contributions.  If such Excess Contributions exceed the
                 balance in the Participant's Account resulting from Elective
                 Deferral Contributions, the balance shall be distributed from
                 the Participant's Account resulting from Qualified Matching
                 Contributions (if applicable) and Qualified Nonelective
                 Contributions, respectively.

                 Any Matching Contributions which were based on the Elective
                 Deferral Contributions which are distributed as Excess
                 Contributions, plus any income and minus any loss allocable
                 thereto, shall be forfeited.  These Forfeitures shall be used
                 to offset the earliest Employer Contribution due after the
                 Forfeiture arises.

         (d)     As of the end of each Plan Year, one of the following tests
                 must be met:

                 (1)      The Average Contribution Percentage for Eligible
                          Participants who are Highly Compensated Employees for
                          the Plan Year is not more than the Average
                          Contribution Percentage for Eligible Participants who
                          are Nonhighly Compensated Employees for the Plan Year
                          multiplied by 1.25.

                 (2)      The Average Contribution Percentage for Eligible
                          Participants who are Highly Compensated Employees for
                          the Plan Year is not more than the Average
                          Contribution Percentage for Eligible Participants who
                          are Nonhighly Compensated Employees for the Plan Year
                          multiplied by 2 and the difference between the
                          Average Contribution Percentages is not more than 2.

                 If one or more Highly Compensated Employees participate in
                 both a cash or deferred arrangement and a plan subject to the
                 Average Contribution Percentage test maintained by the
                 Employer or a Controlled Group member and the sum of the
                 Average Actual Deferral Percentage and Average





ARTICLE III                            37
<PAGE>   38
                 Contribution Percentage of those Highly Compensated Employees
                 subject to either or both tests exceeds the Aggregate Limit,
                 then the Contribution Percentage of those Highly Compensated
                 Employees who also participate in a cash or deferred
                 arrangement will be reduced (beginning with such Highly
                 Compensated Employees whose Contribution Percentage is the
                 highest) so that the limit is not exceeded.  The amount by
                 which each Highly Compensated Employee's Contribution
                 Percentage is reduced shall be treated as an Excess Aggregate
                 Contribution.  The Average Actual Deferral Percentage and
                 Average Contribution Percentage of the Highly Compensated
                 Employees are determined after any corrections required to
                 meet the Average Actual Deferral Percentage and Average
                 Contribution Percentage tests.  Multiple use does not occur if
                 either the Average Actual Deferral Percentage or Average
                 Contribution Percentage of the Highly Compensated Employees
                 does not exceed 1.25 multiplied by the Average Actual Deferral
                 Percentage and Average Contribution Percentage of the
                 Nonhighly Compensated Employees.

                 The Contribution Percentage for any Eligible Participant who
                 is a Highly Compensated Employee for the Plan Year and who is
                 eligible to have Contribution Percentage Amounts allocated to
                 his account under two or more plans described in Code Section
                 401(a) or arrangements described in Code Section 401(k) that
                 are maintained by the Employer or a Controlled Group member
                 shall be determined as if the total of such Contribution
                 Percentage Amounts was made under each plan.  If a Highly
                 Compensated Employee participates in two or more cash or
                 deferred arrangements that have different Plan Years, all cash
                 or deferred arrangements ending with or within the same
                 calendar year shall be treated as a single arrangement.
                 Notwithstanding the foregoing, certain plans shall be treated
                 as separate if mandatorily disaggregated under the regulations
                 under Code Section 401(m) or permissibly disaggregated as
                 provided.

                 In the event that this Plan satisfies the requirements of Code
                 Sections 401(m), 401(a)(4), or 410(b) only if aggregated with
                 one or more other plans, or if one or more other plans satisfy
                 the requirements of Code sections only if aggregated with this
                 Plan, then this section shall be applied by determining the
                 Contribution Percentages of Eligible Participants as if all
                 such plans were a single plan.  Plans may be aggregated in
                 order to satisfy Code Section 401(m) only if they have the
                 same Plan Year.

                 For purposes of determining the Contribution Percentage of an
                 Eligible Participant who is a five-percent owner or one of the
                 ten most highly-paid Highly Compensated Employees, the
                 Contribution Percentage Amounts and Compensation of such
                 Participant shall include Contribution Percentage Amounts and
                 Compensation for the Plan Year of Family Members.  Family
                 Members, with respect to Highly Compensated Employees, shall
                 be disregarded as separate employees in determining the
                 Contribution Percentage both for employees who are Nonhighly
                 Compensated Employees and for employees who are Highly
                 Compensated Employees.

                 For purposes of determining the Contribution Percentage,
                 Participant Contributions are considered to have been made in
                 the Plan Year in which contributed to the Plan.  Matching
                 Contributions and Qualified Nonelective Contributions will be
                 considered made for a Plan Year if made no later than the end
                 of the 12-month period beginning on the day after the close of
                 the Plan Year.





ARTICLE III                            38
<PAGE>   39
                 The Employer shall maintain records sufficient to demonstrate
                 satisfaction of the Average Contribution Percentage test and
                 the amount of Qualified Nonelective Contributions or Qualified
                 Matching Contributions, or both, used in such test.

                 The determination and treatment of the Contribution Percentage
                 of any Participant shall satisfy such other requirements as
                 may be prescribed by the Secretary of the Treasury.

                 Notwithstanding any other provisions of this Plan, Excess
                 Aggregate Contributions, plus any income and minus any loss
                 allocable thereto, shall be forfeited, if not vested, or
                 distributed, if vested, no later than the last day of each
                 Plan Year to Participants to whose Accounts such Excess
                 Aggregate Contributions were allocated for the preceding Plan
                 Year.  If such Excess Aggregate Contributions are distributed
                 more than 2 1/2 months after the last day of the Plan Year in
                 which such excess amounts arose, a ten (10) percent excise tax
                 will be imposed on the employer maintaining the plan with
                 respect to those amounts.  Excess Aggregate Contributions will
                 be distributed beginning with the Highly Compensated
                 Employee(s) who has the greatest Contribution Percentage,
                 reducing his contribution percentage to the next highest
                 level.  Then, if necessary, reducing the Contribution
                 Percentage of the Highly Compensated Employee at the next
                 highest level, and continuing in this manner until the Actual
                 Contribution Percentage of the Highly Compensated Group
                 satisfies the Actual Contribution Percentage Test.  Excess
                 Aggregate Contributions of Participants who are subject to the
                 family member aggregation rules shall be allocated among the
                 Family Members in proportion to the Employee and Matching
                 Contributions (or amounts treated as Matching Contributions)
                 of each Family Member that is combined to determine the
                 combined Contribution Percentage.  Excess Aggregate
                 Contributions shall be treated as Annual Additions, as defined
                 in the CONTRIBUTION LIMITATION SECTION of Article III, under
                 the Plan.

                 The Excess Aggregate Contributions shall be adjusted for
                 income or loss.  The income or loss allocable to such Excess
                 Aggregate Contributions shall be equal to the income or loss
                 allocable to the Participant's Contribution Percentage Amounts
                 for the Plan Year in which the excess occurred multiplied by a
                 fraction.  The numerator of the fraction is the Excess
                 Aggregate Contributions.  The denominator of the fraction is
                 the closing balance without regard to any income or loss
                 occurring during such Plan Year (as of the end of such Plan
                 Year) of the Participant's Account resulting from Contribution
                 Percentage Amounts.

                 Excess Aggregate Contributions shall be distributed from the
                 Participant's Account resulting from Participant Contributions
                 that are not required as a condition of employment or
                 participation or for obtaining additional benefits from
                 Employer Contributions.  If such Excess Aggregate
                 Contributions exceed the balance in the Participant's Account
                 resulting from such Participant Contributions, the balance
                 shall be forfeited, if not vested, or distributed, if vested,
                 on a pro-rata basis from the Participant's Account resulting
                 from Contribution Percentage Amounts.  These Forfeitures shall
                 be used to offset the earliest Employer Contribution due after
                 the Forfeiture arises.





ARTICLE III                            39
<PAGE>   40
                                   ARTICLE IV

                          INVESTMENT OF CONTRIBUTIONS

SECTION 4.01--INVESTMENT OF CONTRIBUTIONS.

         All Contributions are forwarded by the Employer to the Trustee to be
deposited in the Trust Fund.

         Investment of Contributions is governed by the provisions of the
Trust, the Group Contract and any other funding arrangement in which the Trust
Fund is or may be invested.  To the extent permitted by the Trust, Group
Contract or other funding arrangement, the parties named below shall direct the
Contributions to any of the accounts available under the Trust or Group
Contract and may request the transfer of assets resulting from those
Contributions between such accounts.  A Participant may not direct the Trustee
to invest the Participant's Account in collectibles.  Collectibles means any
work of art, rug or antique, metal or gem, stamp or coin, alcoholic beverage or
other tangible personal property specified by the Secretary of Treasury.  To
the extent that a Participant does not direct the investment of his Account,
such Account shall be invested ratably in the accounts available under the
Trust or Group Contract in the same manner as the undirected Accounts of all
other Participants.  The Vested Accounts of all Inactive Participants may be
segregated and invested separately from the Accounts of all other Participants.

         The Trust Fund shall be valued at current fair market value as of the
last day of the last calendar month ending in the Plan Year and, at the
discretion of the Trustee, may be valued more frequently.  The valuation shall
take into consideration investment earnings credited, expenses charged,
payments made and changes in the value of the assets held in the Trust Fund.
The Account of a Participant shall be credited with its share of the gains and
losses of the Trust Fund.  That part of a Participant's Account invested in a
funding arrangement which establishes an account or accounts for such
Participant thereunder shall be credited with the gain or loss from such
account or accounts.  That part of a Participant's Account which is invested in
other funding arrangements shall be credited with a proportionate share of the
gain or loss of such investments.  The share shall be determined by multiplying
the gain or loss of the investment by the ratio of the part of the
Participant's Account invested in such funding arrangement to the total of the
Trust Fund invested in such funding arrangement.

         At least annually, the Named Fiduciary shall review all pertinent
Employee information and Plan data in order to establish the funding policy of
the Plan and to determine appropriate methods of carrying out the Plan's
objectives.  The Named Fiduciary shall inform the Trustee and any Investment
Manager of the Plan's short-term and long-term financial needs so the
investment policy can be coordinated with the Plan's financial requirements.

         (a)     Employer Contributions other than Elective Deferral
                 Contributions:  The Participant shall direct the investment of
                 such Employer Contributions and transfer of assets resulting
                 from those Contributions.

         (b)     Elective Deferral Contributions:  The Participant shall direct
                 the investment of Elective Deferral Contributions and transfer
                 of assets resulting from those Contributions.

         (c)     Rollover Contributions:  The Participant shall direct the
                 investment of Rollover Contributions and transfer of assets
                 resulting from those Contributions.





ARTICLE IV                               40
<PAGE>   41
         However, the Named Fiduciary may delegate to the Investment Manager
investment discretion for Contributions and Plan assets which are not subject
to Participant direction.

SECTION 4.01A--INVESTMENT IN QUALIFYING EMPLOYER SECURITIES.

         Participants in the Plan shall be entitled to invest all or any
portion of their Elective Deferral Contributions in Qualifying Employer
Securities.

         Once investment in Qualifying Employer Securities is made available to
Eligible Employees, then it shall continue to be available unless the Plan and
Trust is amended to disallow such available investment.  In the absence of such
election, such Eligible Employees shall be deemed to have elected to have their
Accounts invested wholly in the Investment Funds.  Once an election is made, it
shall be considered to continue until a new election is made.

         Any dividends payable on the Qualifying Employer Securities shall
unless otherwise directed by the Participant be invested in additional shares
of Qualifying Employer Securities hereunder.

         If the securities of the Employer are not publicly traded and if no
market or an extremely thin market exists for the Qualifying Employer
Securities, so that a reasonable valuation may not be obtained from the market
place, then such Qualifying Employer Securities must be valued at least
annually by an independent appraiser who is not associated with the Employer,
the Plan Administrator, the Trustee, or any person related to any fiduciary
under the Plan.  The independent appraiser may be associated with a person who
is merely a contract administrator with respect to the Plan, but who exercises
no discretionary authority and is not a Plan fiduciary.

         If there is a public market for Qualifying Employer Securities of the
type held by the Plan, then the Plan Administrator may use as the value of the
shares the price at which such shares traded in such market, or an average of
the bid and asked prices for such shares in such market, provided that such
value is representative of the fair market value of such shares in the opinion
of the Plan Administrator.  If the Qualifying Employer Securities do not trade
on the annual valuation date or if the market is very thin on such date, then
the Plan Administrator may use the average of trade prices for a period of time
ending on such date, provided that such value is representative of the fair
market value of such shares in the opinion of the Plan Administrator.  The
value of a Participant's Qualifying Employer Securities Account may be
expressed in units.

         For purposes of determining the annual valuation of the Plan and for
reporting to Participants and regulatory authorities, the assets of the Plan
shall be valued at least annually on the Valuation Date which corresponds to
the last day of the Plan Year.  The fair market value of Qualifying Employer
Securities shall be determined on such a Valuation Date.  The average of the
bid and asked prices of Qualifying Employer Securities as of the date of the
transaction shall apply for purposes of valuing distributions and other
transactions of the Plan to the extent such value is representative of the fair
market value of such shares in the opinion of the Plan Administrator.

         All purchases of Qualifying Employer Securities shall be made at a
price, or prices, which, in the judgment of the Plan Administrator, do not
exceed the fair market value of such Qualifying Employer Securities.

         In the event that the Trustee acquires shares of Qualifying Employer
Securities by purchase from a "disqualified person" as defined in Code Section
4975(e)(2), in exchange for cash or other assets of the Trust, the terms of
such purchase shall contain the provision that in the event that there is a
final determination by the Internal Revenue Service or court of competent
jurisdiction that a fair market value of such shares of Qualifying





ARTICLE IV                           41
<PAGE>   42
Employer Securities, as of the date of purchase was less than the purchase
price paid by the Trustee, then the seller shall pay or transfer, as the case
may be, to the Trustee, an amount of cash, shares of Qualifying Employer
Securities, or any combination thereof equal in value to the difference between
the purchase price and said fair market value for all such shares.  In the
event that cash and/or shares of Qualifying Employer Securities are paid and/or
transferred to the Trustee under this provision, shares of Qualifying Employer
Securities shall be valued at their fair market value as of the date of said
purchase, and interest at a reasonable rate from the date of purchase to the
date of payment shall be paid by the seller on the amount of cash paid.

         The Plan Administrator may direct the Trustee to sell, resell or
otherwise dispose of Qualifying Employer Securities to any person, including
the Employer, provided that any such sales to any disqualified person,
including the Employer, will be made at not less than the fair market value and
no commission is charged.  Any such sale shall be made in conformance with
Section 408(e) of ERISA.

         In the event the Plan Administrator directs the Trustee to dispose of
any Qualifying Employer Securities held as Trust Assets under circumstances
which require registration and/or qualification of the securities under
applicable Federal or state securities laws, then the Employer, at its own
expense, will take or cause to be taken any and all such action as may be
necessary or appropriate to effect such registration and/or qualification.

         The Plan Administrator may exercise the right to vote with respect to
Qualifying Employer Securities or may pass-through such vote to participants in
a manner determined by the Plan Administrator in its sole discretion.  As of
the date hereof, the Plan Administrator shall exercise all voting rights with
respect to Qualifying Employer Securities.

SECTION 4.01B --  LIMITATION OF INVESTMENT IN QUALIFYING
                  EMPLOYER SECURITIES BY SOME PARTICIPANTS.

         Participants who are directors, officers, 10% stockholders of the
Employer, and other persons subject to Section 16 of the Securities Exchange
Act of 1934 (the "1934 Act") will be permitted to change the level of
investment in the Qualifying Employer Securities Account only once every six
months.  Additionally, Participants who are directors, officers, 10%
stockholders of the Employer, and other persons subject to Section 16 of the
1934 Act who cease participation in the Qualifying Employer Securities Account,
or who reduce their participation in such account to a nominal level, may not
participate (e.g., direct that investments be made on their behalf) under the
Qualifying Employer Securities Account again for at least six months.
Intra-plan transfers by such Participants between the Qualifying Employer
Securities Account and the other investment accounts available under the Plan
may only be made pursuant to an investment election made during the period
beginning on the third business day following the date of release of annual or
quarterly financial information by the Employer and ending on the twelfth
business day following such date.  Subject to certain limited exceptions,
Participants who are directors, officers, 10% stockholders of the Employer, and
other persons subject to Section 16 of the 1934 Act making withdrawals of
investments under the Qualifying Employer Securities Account must cease further
purchases/investment under the Qualifying Employer Securities Account for six
months.

         With respect to Participants who are directors, officers, 10%
stockholders of the Employer, and other persons subject to the 1934 Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b- 3 or its successors under the 1934 Act.  To the extent
any provisions of the Plan or action by the Plan Administrator fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Plan Administrator.





ARTICLE IV                          42
<PAGE>   43
                                   ARTICLE V

                                    BENEFITS

SECTION 5.01--RETIREMENT BENEFITS.

         On a Participant's Retirement Date, his Vested Account shall be
distributed to him according to the distribution of benefits provisions of
Article VI and the provisions of the SMALL AMOUNTS SECTION of Article IX.

SECTION 5.02--DEATH BENEFITS.

         If a Participant dies before his Annuity Starting Date, his Vested
Account shall be distributed according to the distribution of benefits
provisions of Article VI and the provisions of the SMALL AMOUNTS SECTION of
Article IX.

SECTION 5.03--VESTED BENEFITS.

         A Participant may receive a distribution of his Vested Account at any
time after he ceases to be an Employee, provided he has not again become an
Employee.  If such amount is not payable under the provisions of the SMALL
AMOUNTS SECTION of Article IX, it will be distributed only if the Participant
so elects.

         If a Participant does not receive an earlier distribution according to
the provisions of this section or the SMALL AMOUNTS SECTION of Article IX, upon
his Retirement Date or death, his Vested Account shall be applied according to
the provisions of the RETIREMENT BENEFITS SECTION or the DEATH BENEFITS SECTION
of Article V.

         The Nonvested Account of a Participant who has ceased to be an
Employee shall remain a part of his Account until it becomes a Forfeiture;
provided, however, if the Participant again becomes an Employee so that his
Vesting Percentage can increase, the Nonvested Account may become a part of his
Vested Account.

SECTION 5.04--WHEN BENEFITS START.

         Benefits under the Plan begin when a Participant retires, dies or
ceases to be an Employee, whichever applies, as provided in the preceding
sections of this article.  Benefits which begin before Normal Retirement Date
for a Participant who became Totally and Permanently Disabled when he was an
Employee shall be deemed to begin because he is Totally and Permanently
Disabled.  The start of benefits is subject to the qualified election
procedures of Article VI.

         Unless otherwise elected, benefits shall begin before the sixtieth day
following the close of the Plan Year in which the latest date below occurs:

         (a)     The date the Participant attains age 65 (Normal Retirement
                 Age, if earlier).

         (b)     The tenth anniversary of the Participant's Entry Date.

         (c)     The date the Participant ceases to be an Employee.





ARTICLE V                       43
<PAGE>   44
         Notwithstanding the foregoing, the failure of a Participant and spouse
to consent to a distribution while a benefit is immediately distributable,
within the meaning of the ELECTION PROCEDURES SECTION of Article VI, shall be
deemed to be an election to defer commencement of payment of any benefit
sufficient to satisfy this section.

         The Participant may elect to have his benefits begin after the latest
date for beginning benefits described above, subject to the provisions of this
section.  The Participant shall make the election in writing and deliver the
signed statement of election to the Plan Administrator before Normal Retirement
Date or the date he ceases to be an Employee, if later.  The election must
describe the form of distribution and the date the benefits will begin.  The
Participant shall not elect a date for beginning benefits or a form of
distribution that would result in a benefit payable when he dies which would be
more than incidental within the meaning of governmental regulations.

         Benefits shall begin by the Participant's required beginning date, as
defined in the FORM OF DISTRIBUTION SECTION of Article VI.

         Contributions which are used to compute the Actual Deferral
Percentage, as defined in the EXCESS AMOUNTS SECTION of Article III, may be
distributed upon disposition by the Employer of substantially all of the assets
(within the meaning of Code Section 409(d)(2)) used by the Employer in a trade
or business or disposition by the Employer of the Employer's interest in a
subsidiary (within the meaning of Code Section 409(d)(3)) if the transferee
corporation is not a Controlled Group member, the Employee continues employment
with the transferee corporation and the transferor corporation continues to
maintain the Plan.  Such distributions made after March 31, 1988, must be made
in a single sum.

SECTION 5.05--WITHDRAWAL PRIVILEGES.

         A Participant who has attained age 59 1/2 may withdraw all or any
portion of his Vested Account which results from the following Contributions:

         Elective Deferral Contributions
         Matching Contributions
         Qualified Nonelective Contributions
         Discretionary Contributions
         Rollover Contributions

         No distribution from the Participant's Account shall occur prior to
100% vesting.

         A Participant may make such a withdrawal at any time.

         A Participant may withdraw all or any portion of his Vested Account
which results from the following Contributions

         Elective Deferral Contributions

in the event of hardship due to an immediate and heavy financial need.
Withdrawals from the Participant's Account resulting from Elective Deferral
Contributions shall be limited to the amount of the Participant's Elective
Deferral Contributions.  Immediate and heavy financial need shall be limited
to:  (i) expenses incurred or necessary for medical care, described in Code
Section 213(d), of the Participant, the Participant's spouse, or any





ARTICLE V                          44
<PAGE>   45
dependents of the Participant (as defined in Code Section 152); (ii) purchase
(excluding mortgage payments) of a principal residence for the Participant;
(iii) payment of tuition and related educational fees for the next 12 months of
post-secondary education for the Participant, his spouse, children or
dependents; (iv) the need to prevent the eviction of the Participant from his
principal residence or foreclosure on the mortgage of the Participant's
principal residence; or (v) any other distribution which is deemed by the
Commissioner of Internal Revenue to be made on account of immediate and heavy
financial need as provided in Treasury regulations.  The Participant's request
for a withdrawal shall include his written statement that an immediate and
heavy financial need exists and explain its nature.

         No withdrawal shall be allowed which is not necessary to satisfy such
immediate and heavy financial need.  Such withdrawal shall be deemed necessary
only if all of the following requirements are met:  (i) the distribution is not
in excess of the amount of the immediate and heavy financial need of the
Participant (including amounts necessary to pay any Federal, state or local
income taxes or penalties reasonably anticipated to result from the
distribution); (ii) the Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently available under all
plans maintained by the Employer; (iii) the Plan, and all other plans
maintained by the Employer, provide that the Participant's elective
contributions and employee contributions will be suspended for at least 12
months after receipt of the hardship distribution; and (iv) the Plan, and all
other plans maintained by the Employer, provide that the Participant may not
make elective contributions for the Participant's taxable year immediately
following the taxable year of the hardship distribution in excess of the
applicable limit under Code Section 402(g) for such next taxable year less the
amount of such Participant's elective contributions for the taxable year of the
hardship distribution.  The Plan will suspend elective contributions and
employee contributions for 12 months and limit elective deferrals as provided
in the preceding sentence.  A Participant shall not cease to be an Eligible
Participant, as defined in the EXCESS AMOUNTS SECTION of Article III, merely
because his elective contributions or employee contributions are suspended.

         A request for withdrawal shall be in writing on a form furnished for
that purpose and delivered to the Plan Administrator before the withdrawal is
to occur.

         A forfeiture shall not occur solely as a result of a withdrawal.

SECTION 5.06--LOANS TO PARTICIPANTS.

         Loans shall be made available to all Participants on a reasonably
equivalent basis.  For purposes of this section, Participant means any
Participant or Beneficiary who is a party-in-interest, within the meaning of
Section 3(14) of the Employee Retirement Income Security Act of 1974.  Loans
shall not be made to highly compensated employees, as defined in Code Section
414(q), in an amount greater than the amount made available to other
Participants.

         No loans will be made to any shareholder-employee or owner-employee.
For purposes of this requirement, a shareholder-employee means an employee or
officer of an electing small business (Subchapter S) corporation who owns (or
is considered as owning within the meaning of Code Section 318(a)(1)), on any
day during the taxable year of such corporation, more than 5% of the
outstanding stock of the corporation.





ARTICLE V                         45
<PAGE>   46
         A loan to a Participant shall be a Participant-directed investment of
his Account.  No Account other than the borrowing Participant's Account shall
share in the interest paid on the loan or bear any expense or loss incurred
because of the loan.

         The number of outstanding loans shall be limited to one.  No more than
one loan will be approved for any Participant in any 12-month period.  The
minimum amount of any loan shall be $1,000.

         Loans must be adequately secured and bear a reasonable rate of
interest.

         The amount of the loan shall not exceed the maximum amount that may be
treated as a loan under Code Section 72(p) (rather than a distribution) to the
Participant and shall be equal to the lesser of (a) or (b) below:

         (a)     $50,000 reduced by the highest outstanding loan balance of
                 loans during the one-year period ending on the day before the
                 new loan is made.

         (b)     The greater of (1) or (2), reduced by (3) below:

                 (1)      One-half of the Participant's Vested Account.

                 (2)      $10,000.

                 (3)      Any outstanding loan balance on the date the new loan
                          is made.

For purposes of this maximum, a Participant's Vested Account does not include
any accumulated deductible employee contributions, as defined in Code Section
72(o)(5)(B), and all qualified employer plans, as defined in Code Section
72(p)(4), of the Employer and any Controlled Group member shall be treated as
one plan.

         The foregoing notwithstanding, the amount of such loan shall not
exceed 50% of the amount of the Participant's Vested Account.   For purposes of
this maximum, a Participant's Vested Account does not include any accumulated
deductible employee contributions, as defined in Code Section 72(o)(5)(B).  No
collateral other than a portion of the Participant's Vested Account (as limited
above) shall be accepted.  The Loan Administrator shall determine if the
collateral is adequate for the amount of the loan requested.

         Notwithstanding any other provision of this Plan, the portion of the
Participant's Vested Account used as a security interest held by the Plan by
reason of a loan outstanding to the Participant shall be taken into account for
purposes of determining the amount of the Vested Account payable at the time of
death or distribution, but only if the reduction is used as repayment of the
loan.

         Each loan shall bear a reasonable fixed rate of interest to be
determined by the Loan Administrator.  In determining the interest rate, the
Loan Administrator shall take into consideration fixed interest rates currently
being charged by commercial lenders for loans of comparable risk on similar
terms and for similar durations, so





ARTICLE V                           46
<PAGE>   47
that the interest will provide for a return commensurate with rates currently
charged by commercial lenders for loans made under similar circumstances.  The
Loan Administrator shall not discriminate among Participants in the matter of
interest rates; but loans granted at different times may bear different
interest rates in accordance with the current appropriate standards.

         The loan shall by its terms require that repayment (principal and
interest) be amortized in level payments, not less frequently than quarterly,
over a period not extending beyond five years from the date of the loan.  A
loan is not subject to this five-year repayment requirement if it is used to
buy any dwelling unit, which within a reasonable time, is to be used as the
principal residence of the Participant.  The "reasonable time" will be
determined at the time the loan is made.  The period of repayment for any loan
shall be arrived at by mutual agreement between the Loan Administrator and the
Participant.

         The Participant shall make a written application for a loan from the
Plan on forms provided by the Loan Administrator.  The application must specify
the amount and duration requested.  No loan will be approved unless the
Participant is creditworthy.  The Participant must grant authority to the Loan
Administrator to investigate the Participant's creditworthiness so that the
loan application may be properly considered.

         Information contained in the application for the loan concerning the
income, liabilities, and assets of the Participant will be evaluated to
determine whether there is a reasonable expectation that the Participant will
be able to satisfy payments on the loan as due.  Additionally, the Loan
Administrator will pursue any appropriate further investigations concerning the
creditworthiness and/or credit history of the Participant to determine whether
a loan should be approved.

         Each loan shall be fully documented in the form of a promissory note
signed by the Participant for the face amount of the loan, together with
interest determined as specified above.

         There will be an assignment of collateral to the Plan executed at the
time the loan is made.

         In those cases where repayment through payroll deduction by the
Employer is available, installments are so payable, and a payroll deduction
agreement will be executed by the Participant at the time of making the loan.

         Where payroll deduction is not available, payments are to be timely
made.

         Any payment that is not by payroll deduction shall be made payable to
the Employer or Trustee, as specified in the promissory note, and delivered to
the Loan Administrator, including prepayments, service fees and penalties, if
any, and other amounts due under the note.

         The promissory note may provide for reasonable late payment penalties
and/or service fees.  Any penalties or service fees shall be applied to all
Participants in a nondiscriminatory manner.  If the promissory note so
provides, such amounts may be assessed and collected from the Account of the
Participant as part of the loan balance.

         Each loan may be paid prior to maturity, in part or in full, without
penalty or service fee, except as may be set out in the promissory note.

         If any amount remains unpaid for more than 31 days after due, a
default is deemed to occur.





ARTICLE V                            47
<PAGE>   48
         Upon default, the Plan has the right to pursue any remedy available by
law to satisfy the amount due, along with accrued interest, including the right
to enforce its claim against the security pledged and execute upon the
collateral as allowed by law.

         If any payment of principal or interest or any other amount due under
the promissory note, or any portion thereof, is not made for a period of 90
days after due, the entire principal balance whether or not otherwise then due,
shall become immediately due and payable without demand or notice, and subject
to collection or satisfaction by any lawful means, including specifically but
not limited to the right to enforce the claim against the security pledged and
to execute upon the collateral as allowed by law.

         In the event of default, foreclosure on the note and attachment of
security or use of amounts pledged to satisfy the amount then due, will not
occur until a distributable event occurs in accordance with the Plan, and will
not occur to an extent greater than the amount then available upon any
distributable event which has occurred under the Plan.

         All reasonable costs and expenses, including but not limited to
attorney's fees, incurred by the Plan in connection with any default or in any
proceeding to enforce any provision of a promissory note or instrument by which
a promissory note for a Participant loan is secured, shall be assessed and
collected from the Account of the Participant as part of the loan balance.

         If payroll deduction is being utilized, in the event that a
Participant's available payroll deduction amounts in any given month are
insufficient to satisfy the total amount due, there will be an increase in the
amount taken subsequently, sufficient to make up the amount that is then due.
If the subsequent deduction is also insufficient to satisfy the amount due
within 31 days, a default is deemed to occur as above.  If any amount remains
past due more than 90 days, the entire principal amount, whether or not
otherwise then due, along with interest then accrued and any other amount then
due under the promissory note, shall become due and payable, as above.

         If the Participant ceases to be a party-in-interest (as defined in
this section), the balance of the outstanding loan becomes due and payable, and
the Participant's Vested Account will be used as available for distribution(s)
to pay the outstanding loan.  The Participant's Vested Account will not be used
to pay any amount due under the outstanding loan before the date which is 31
days after the date he ceased to be an Employee, and the Participant may elect
to repay the outstanding loan with interest on the day of repayment.  If no
distributable event has occurred under the Plan at the time that the
Participant's Vested Account would otherwise be used under this provision to
pay any amount due under the outstanding loan, this will not occur until the
time, or in excess of the extent to which, a distributable event occurs under
the Plan.





ARTICLE V                             48
<PAGE>   49
                                   ARTICLE VI

                            DISTRIBUTION OF BENEFITS

SECTION 6.01--FORM OF DISTRIBUTION.

         The form of benefit payable to or on behalf of a Participant is a
single sum payment. The entire interest of a Participant must be distributed no
later than the Participant's required beginning date. The Participant's
required beginning date is the first day of April of the calendar year
following the calendar year in which the Participant attains age 70 1/2, unless
otherwise provided in (a), (b) or (c) below:

         (a)     The required beginning date for a Participant who attains age
                 70 1/2 before January 1, 1988, and who is not a 5-percent
                 owner is the first day of April of the calendar year following
                 the calendar year in which the later of retirement or
                 attainment of age 70 1/2 occurs.

         (b)     The required beginning date for a Participant who attains age
                 70 1/2 before January 1, 1988, and who is a 5-percent owner is
                 the first day of April of the calendar year following the
                 later of

                 (1)      the calendar year in which the Participant attains
                          age 70 1/2, or

                 (2)      the earlier of the calendar year with or within which
                          ends the Plan Year in which the Participant becomes a
                          5-percent owner, or the calendar year in which the
                          Participant retires.

         (c)     The required beginning date of a Participant who is not a
                 5-percent owner and who attains age 70 1/2 during 1988 and who
                 has not retired as of January 1, 1989, is April 1. 1990.

A Participant is treated as a 5-percent owner for purposes of this section if
such Participant is a 5-percent owner as defined in Code Section 416(i)
(determined in accordance with Code Section 416 but without regard to whether
the Plan is top-heavy) at any time during the Plan Year ending with or within
the calendar year in which such owner attains age 66 1/2 or any subsequent Plan
Year.

SECTION 6.02--ELECTION PROCEDURES.

         The Participant shall make any election under this section in writing.
The Plan Administrator may require such individual to complete and sign any
necessary documents as to the provisions to be made.  Any election permitted
under (a) below shall be subject to the qualified election provisions of (b)
below.

         (a)     Death Benefits. A Participant may elect his Beneficiary.

         (b)     Qualified Election.  The Participant may make an election at
                 any time during the election period.  The Participant revoke
                 the election made (or make a new election) at any time and any
                 number of times during the election period.  An election is
                 effective only if it meets the consent requirements below.

                 A Participant may make an election as to death benefits at any
                 time before he dies.





ARTICLE VI                            49
<PAGE>   50
                 If the Participant's Vested Account has at any time exceeded
                 $3,500, any benefit which is immediately distributable
                 requires the consent of the Participant.  The consent of the
                 Participant to a benefit which is immediately distributable
                 must not be made before the date the Participant is provided
                 with the notice of the ability to defer the distribution. Such
                 consent shall be made in writing. The consent shall not be
                 made more than 90 days before the Annuity Starting Date.  The
                 consent of the Participant shall not be required to the extent
                 that a distribution is required to satisfy Code Section
                 401(a)(9) or Code Section 415.  In addition, upon termination
                 of this Plan if the Plan does not offer an annuity option
                 (purchased from a commercial provider), the Participant's
                 Account balance may, without the Participant's consent, be
                 distributed to the Participant or transferred to another
                 defined contribution plan (other than an employee stock
                 ownership plan as defined in Code Section 4975(e)(7)) within
                 the same Controlled Group.  A benefit is immediately
                 distributable if any part of the benefit could be distributed
                 to the Participant before the Participant attains the older of
                 Normal Retirement Age or age 62.  Spousal consent is needed to
                 name a Beneficiary other than the spouse. If the Participant
                 names a Beneficiary other than his spouse, the spouse has the
                 right to limit consent only to a specific Beneficiary.  The
                 spouse can relinquish such right.  Such consent shall be made
                 in writing. The spouse's consent shall be witnessed by a plan
                 representative or notary public.  The spouse's consent must
                 acknowledge the effect of the election, including that the
                 spouse had the right to limit consent only to a specific
                 Beneficiary and that the relinquishment of such right was
                 voluntary.  Unless the consent of the spouse expressly permits
                 designations by the Participant without a requirement of
                 further consent by the spouse, the spouse's consent must be
                 limited to the Beneficiary, class of Beneficiaries, or
                 contingent Beneficiary named in the election.  Spousal consent
                 is not required, however, if the Participant establishes to
                 the satisfaction of the plan representative that the consent
                 of the spouse cannot be obtained because there is no spouse or
                 the spouse cannot be located.  A spouse's consent under this
                 paragraph shall not be valid with respect to any other spouse.
                 A Participant may revoke a prior election without the consent
                 of the spouse.  Any new election will require a new spousal
                 consent, unless the consent of the spouse expressly permits
                 such election by the Participant without further consent by
                 the spouse.  A spouse's consent may be revoked at any time
                 within the Participant's election period.

SECTION 6.03--NOTICE REQUIREMENTS.

         The Plan Administrator shall furnish to the Participant a written
explanation of the right of the Participant to defer distribution until the
benefit is no longer immediately distributable.  The Plan Administrator shall
furnish the written explanation by a method reasonably calculated to reach the
attention of the Participant no less than 30 days and no more than 90 days
before the Annuity Starting Date.

SECTION 6.04--DISTRIBUTIONS UNDER QUALIFIED DOMESTIC RELATIONS ORDERS.

         The Plan specifically permits distributions to an Alternate Payee
under a qualified domestic relations order as defined in Code Section 414(p),
at any time, irrespective of whether the Participant has attained his earliest
retirement age as defined in Code Section 414(p), under the Plan.  A
distribution to an Alternate Payee before the Participant's attainment of
earliest retirement age, as defined in Code Section 414(p), is available only
if:

         a)      the order specifies distributions at that time or permits an
                 agreement between the Plan and the Alternate Payee to
                 authorize an earlier distribution; and





ARTICLE VI                            50
<PAGE>   51
         b)      if the present value of the Alternate Payee's benefits under
                 the Plan exceeds $3,500, and the order requires, the Alternate
                 Payee consents to any distribution occurring before the
                 Participant's attainment of earliest retirement age, as
                 defined in Code Section 414(p).

         Nothing in this section shall permit a Participant a right to receive
a distribution at a time otherwise not permitted under the Plan nor shall it
permit the Alternate Payee to receive a form of payment not permitted under the
Plan.

         The Plan Administrator shall establish reasonable procedures to
determine the qualified status of a domestic relations order.  Upon receiving a
domestic relations order, the Plan Administrator promptly shall notify the
Participant and an Alternate Payee named in the order, in writing, of the
receipt of the order and the Plan's procedures for determining the qualified
status of the order.  Within a reasonable period of time after receiving the
domestic relations order, the Plan Administrator shall determine the qualified
status of the order and shall notify the Participant and each Alternate Payee,
in writing, of its determination.  The Plan Administrator shall provide notice
under this paragraph by mailing to the individual's address specified in the
domestic relations order, or in a manner consistent with Department of Labor
regulations.  The Plan Administrator may treat as qualified any domestic
relations order entered before January 1, 1985, irrespective of whether it
satisfies all the requirements described in Code Section 414(p).

         If any portion of the Participant's Vested Account is payable during
the period the Plan Administrator is making its determination of the qualified
status of the domestic relations order, a separate accounting shall be made of
the amount payable.  If the Plan Administrator determines the order is a
qualified domestic relations order within 18 months of the date amounts are
first payable following receipt of the order, the payable amount shall be
distributed in accordance with the order.  If the Plan Administrator does not
make its determination of the qualified status of the order within the 18 month
determination period, the payable amounts shall be distributed in the manner
the Plan would distribute if the order did not exist and the order shall apply
prospectively if the Plan Administrator later determines the order is a
qualified domestic relations order.

         The Plan shall make payments or distributions required under this
section by separate benefit checks or other separate distribution to the
Alternate Payee(s).





ARTICLE VI                        51
<PAGE>   52
                                  ARTICLE VII

                              TERMINATION OF PLAN

         The Employer expects to continue the Plan indefinitely but reserves
the right to terminate the Plan in whole or in part at any time upon giving
written notice to all parties concerned.  Complete discontinuance of
Contributions under the Plan constitutes complete termination of Plan.

         The Account of each Participant shall be fully (100%) vested and
nonforfeitable as of the effective date of complete termination of Plan.  The
Account of each Participant who is included in the group of Participants deemed
to be affected by the partial termination of the Plan shall be fully (100%)
vested and nonforfeitable as of the effective date of the partial Plan
termination.  The Participant's Account shall continue to participate in the
earnings credited, expenses charged and any appreciation or depreciation of the
Investment Fund until the Vested Account is distributed.  A distribution under
this article will be a retirement benefit and shall be distributed to the
Participant according to the provisions of Article VI.

         A Participant's Account which does not result from Contributions which
are used to compute the Actual Deferral Percentage, as defined in the EXCESS
AMOUNTS SECTION of Article III, may be distributed to the Participant after the
effective date of the complete or partial Plan termination.  A Participant's
Account resulting from Contributions which are used to compute such percentage
may be distributed upon termination of the Plan without the establishment or
maintenance of another defined contribution plan, other than an employee stock
ownership plan (as defined in Code Section 4975(e) or Code Section 409) or a
simplified employee pension plan (as defined in Code Section 408(k)).  Such a
distribution made after March 31, 1988, must be in a single sum.

         Upon complete termination of Plan, no more Employees shall become
Participants and no more Contributions shall be made.

         The assets of this Plan shall not be paid to the Employer at any time,
except that, after the satisfaction of all liabilities under the Plan, any
assets remaining may be paid to the Employer.  The payment may not be made if
it would contravene any provision of law.





ARTICLE VII                          52
<PAGE>   53
                                  ARTICLE VIII

                             ADMINISTRATION OF PLAN

SECTION 8.01--ADMINISTRATION.

         Subject to the provisions of this article, the Plan Administrator has
complete control of the administration of the Plan.  The Plan Administrator has
all the powers necessary for it to properly carry out its administrative
duties.  Not in limitation, but in amplification of the foregoing, the Plan
Administrator has the power to construe the Plan, including ambiguous
provisions, and to determine all questions that may arise under the Plan,
including all questions relating to the eligibility of Employees to participate
in the Plan and the amount of benefit to which any Participant or Beneficiary
may become entitled.  The Plan Administrator's decisions upon all matters
within the scope of its authority shall be final.

         Unless otherwise set out in the Plan or Group Contract, the Plan
Administrator may delegate recordkeeping and other duties which are necessary
for the administration of the Plan to any person or firm which agrees to accept
such duties.  The Plan Administrator shall be entitled to rely upon all tables,
valuations, certificates and reports furnished by the consultant or actuary
appointed by the Plan Administrator and upon all opinions given by any counsel
selected or approved by the Plan Administrator.

         The Plan Administrator shall receive all claims for benefits by
Participants, former Participants and Beneficiaries.  The Plan Administrator
shall determine all facts necessary to establish the right of any Claimant to
benefits and the amount of those benefits under the provisions of the Plan.
The Plan Administrator may establish rules and procedures to be followed by
Claimants in filing claims for benefits, in furnishing and verifying proofs
necessary to determine age, and in any other matters required to administer the
Plan.

         The Plan Administrator shall direct the Trustee as to the exercise of
all voting powers over any shares of Qualifying Employer Securities.

SECTION 8.02--RECORDS.

         All acts and determinations of the Plan Administrator shall be duly
recorded.  All these records, together with other documents necessary for the
administration of the Plan, shall be preserved in the Plan Administrator's
custody.

         Writing (handwriting, typing, printing), photostating, photographing,
microfilming, magnetic impulse, mechanical or electrical recording or other
forms of data compilation shall be acceptable means of keeping records.

SECTION 8.03--INFORMATION AVAILABLE.

         Any Participant in the Plan or any Beneficiary may examine copies of
the Plan description, latest annual report, any bargaining agreement, this
Plan, the Group Contract or any other instrument under which the Plan was
established or is operated.  The Plan Administrator shall maintain all of the
items listed in this section in its office, or in such other place or places as
it may designate in order to comply with governmental regulations.  These items
may be examined during reasonable business hours.  Upon the written request of
a Participant or





ARTICLE VIII                           53
<PAGE>   54
Beneficiary receiving benefits under the Plan, the Plan Administrator will
furnish him with a copy of any of these items.  The Plan Administrator may make
a reasonable charge to the requesting person for the copy.

SECTION 8.04--CLAIM AND APPEAL PROCEDURES.

         A Claimant must submit any required forms and pertinent information
when making a claim for benefits under the Plan.

         If a claim for benefits under the Plan is denied, the Plan
Administrator shall provide adequate written notice to the Claimant whose claim
for benefits under the Plan has been denied.  The notice must be furnished
within 90 days of the date that the claim is received by the Plan
Administrator.  The Claimant shall be notified in writing within this initial
90-day period if special circumstances require an extension of time needed to
process the claim and the date by which the Plan Administrator's decision is
expected to be rendered.  The written notice shall be furnished no later than
180 days after the date the claim was received by the Plan Administrator.

         The Plan Administrator's notice to the Claimant shall specify the
reason for the denial; specify references to pertinent Plan provisions on which
denial is based; describe any additional material and information needed for
the Claimant to perfect his claim for benefits; explain why the material and
information is needed; inform the Claimant that any appeal he wishes to make
must be in writing to the Plan Administrator within 60 days after receipt of
the Plan Administrator's notice of denial of benefits and that failure to make
the written appeal within such 60-day period shall render the Plan
Administrator's determination of such denial final, binding and conclusive.

         If the Claimant appeals to the Plan Administrator, the Claimant, or
his authorized representative, may submit in writing whatever issues and
comments the Claimant, or his representative, feels are pertinent.  The
Claimant, or his authorized representative may review pertinent Plan documents.
The Plan Administrator shall reexamine all facts related to the appeal and make
a final determination as to whether the denial of benefits is justified under
the circumstances.  The Plan Administrator shall advise the Claimant of its
decision within 60 days of his written request for review, unless special
circumstances (such as a hearing) would make rendering a decision within the
60-day limit unfeasible.  The Claimant must be notified within the 60-day limit
if an extension is necessary.  The Plan Administrator shall render a decision
on a claim for benefits no later than 120 days after the request for review is
received.

SECTION 8.05--UNCLAIMED VESTED ACCOUNT PROCEDURE.

         At the time the Participant's Vested Account is distributable to the
Participant, spouse or Beneficiary without his consent according to the
provisions of Article VI or Article IX, the Plan Administrator, by certified or
registered mail addressed to his last known address and in accordance with the
notice requirements of Article VI, will notify him of his entitlement to a
benefit.  If the Participant, spouse or Beneficiary fails to claim the Vested
Account or make his whereabouts known in writing within six months from the
date of mailing the notice, the Plan Administrator may treat such unclaimed
Vested Account as a forfeiture and apply it according to the forfeiture
provisions of Article III.  If Article III contains no forfeiture provisions,
such amount will be applied to reduce the earliest Employer Contributions due
after the forfeiture arises.

         If a Participant's Vested Account is forfeited according to the
provisions of the above paragraph and the Participant, his spouse or his
Beneficiary at any time make a claim for benefits, the forfeited Vested Account
shall be reinstated, unadjusted for any gains or losses occurring after the
date it was forfeited.  The reinstated Vested Account shall then be distributed
to the Participant, spouse or Beneficiary according to the preceding provisions
of the Plan.

SECTION 8.06--DELEGATION OF AUTHORITY.

         All or any part of the administrative duties and responsibilities
under this article may be delegated by the Plan Administrator to a retirement
committee.  The duties and responsibilities of the retirement committee shall
be set out in a separate written agreement.





ARTICLE VIII                         54
<PAGE>   55
                                   ARTICLE IX

                               GENERAL PROVISIONS

SECTION 9.01--AMENDMENTS.

         The Employer may amend this Plan at any time, including any remedial
retroactive changes (within the specified period of time as may be determined
by Internal Revenue Service regulations) to comply with the requirements of any
law or regulation issued by any governmental agency to which the Employer is
subject.  An amendment may not diminish or adversely affect any accrued
interest or benefit of Participants or their Beneficiaries or eliminate an
optional form of distribution with respect to benefits attributable to service
before the amendment nor allow reversion or diversion of Plan assets to the
Employer at any time, except as may be necessary to comply with the
requirements of any law or regulation issued by any governmental agency to
which the Employer is subject.  No amendment to this Plan shall be effective to
the extent that it has the effect of decreasing a Participant's accrued
benefit.  However, a Participant's Account may be reduced to the extent
permitted under Code Section 412(c)(8).  For purposes of this paragraph, a Plan
amendment which has the effect of decreasing a Participant's Account or
eliminating an optional form of benefit, with respect to benefits attributable
to service before the amendment shall be treated as reducing an accrued
benefit.  Furthermore, if the vesting schedule of the Plan is amended, in the
case of an Employee who is a Participant as of the later of the date such
amendment is adopted or the date it becomes effective, the nonforfeitable
percentage (determined as of such date) of such Employee's employer-derived
accrued benefit will not be less than his percentage computed under the Plan
without regard to such amendment.

         An amendment shall not decrease a Participant's vested interest in the
Plan.  If an amendment to the Plan, or a deemed amendment in the case of a
change in top-heavy status of the Plan as provided in the MODIFICATION OF
VESTING REQUIREMENTS SECTION of Article X, changes the computation of the
percentage used to determine that portion of a Participant's Account
attributable to Employer Contributions which is nonforfeitable (whether
directly or indirectly), each Participant or former Participant

         (a)     who has completed at least three Years of Service on the date
                 the election period described below ends (five Years of
                 Service if the Participant does not have at least one
                 Hour-of-Service in a Plan Year beginning after December 31,
                 1988) and

         (b)     whose nonforfeitable percentage will be determined on any date
                 after the date of the change

may elect, during the election period, to have the nonforfeitable percentage of
his Account that results from Employer Contributions determined without regard
to the amendment.  This election may not be revoked.  An election does not need
to be provided for any Participant or former Participant whose nonforfeitable
percentage, determined according to the Plan provisions as changed, cannot at
any time be less than the percentage determined without regard to such change.
The election period shall begin no later than the date the Plan amendment is
adopted, or deemed adopted in the case of a change in the top-heavy status of
the Plan, and end no earlier than the sixtieth day after the latest of the date
the amendment is adopted (deemed adopted) or becomes effective, or the date the
Participant is issued written notice of the amendment (deemed amendment) by the
Employer or the Plan Administrator.

SECTION 9.02--DIRECT ROLLOVERS.

         This section applies to distributions made on or after January 1,
1993.  Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a Distributee's election under this section, a Distributee may
elect, at the time and in the manner prescribed by the Plan Administrator, to
have any portion of an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan, specified by the Distributee, in a Direct Rollover.





ARTICLE IX                        55
<PAGE>   56
SECTION 9.03--MERGERS AND DIRECT TRANSFERS.

         The Plan may not be merged or consolidated with, nor have its assets
or liabilities transferred to, any other retirement plan, unless each
Participant in the plan would (if the plan then terminated) receive a benefit
immediately after the merger, consolidation or transfer which is equal to or
greater than the benefit the Participant would have been entitled to receive
immediately before the merger, consolidation or transfer (if this Plan had then
terminated).  The Employer may enter into merger agreements or direct transfer
of assets agreements with the employers under other retirement plans which are
qualifiable under Code Section 401(a), including an elective transfer, and may
accept the direct transfer of plan assets, or may transfer plan assets, as a
party to any such agreement.  The Employer shall not consent to, or be a party
to a merger, consolidation or transfer of assets with a defined benefit plan if
such action would result in a defined benefit feature being maintained under
this Plan.  The Employer shall not consent to, or be a party to a merger,
consolidation or transfer of assets with a plan which is subject tot he
survivor annuity requirements of Code Section 401(a)(11) if such action would
result in a survivor annuity feature being maintained under the Plan.

         The Plan may accept a direct transfer of plan assets on behalf of an
Eligible Employee.  If the Eligible Employee is not an Active Participant when
the transfer is made, the Eligible Employee shall be deemed to be an Active
Participant only for the purpose of investment and distribution of the
transferred assets.  Employer Contributions shall not be made for or allocated
to the Eligible Employee, until the time he meets all of the requirements to
become an Active Participant.

         The Plan shall hold, administer and distribute the transferred assets
as a part of the Plan.  The Plan shall maintain a separate account for the
benefit of the Employee on whose behalf the Plan accepted the transfer in order
to reflect the value of the transferred assets.

         This Plan shall not accept any direct or indirect transfers (as that
term is defined and interpreted under Code Section 401(a)(11) and the
Regulations thereunder) from a defined benefit plan, money purchase plan
(including a target benefit plan), stock bonus or profit sharing plan which
would otherwise have provided for a life annuity form of payment to the
Participant.

SECTION 9.04 --  PROVISIONS RELATING TO THE INSURER
                          AND OTHER PARTIES.

         The obligations of an Insurer shall be governed solely by the
provisions of the Group Contract.  The Insurer shall not be required to perform
any act not provided in or contrary to the provisions of the Group Contract.
See the CONSTRUCTION SECTION of this article.

         Any issuer or distributor of investment contracts or securities is
governed solely by the terms of its policies, written investment contract,
prospectuses, security instruments, and any other written agreements entered
into with the Trustee.





ARTICLE IX                         56
<PAGE>   57
         Such Insurer, issuer or distributor is not a party to the Plan, nor
bound in any way by the Plan provisions.  Such parties shall not be required to
look to the terms of this Plan, nor to determine whether the Employer, the Plan
Administrator, the Trustee, or the Named Fiduciary have the authority to act in
any particular manner or to make any contract or agreement.

         Until notice of any amendment or termination of this Plan or a change
in Trustee has been received by the Insurer at its home office or an issuer or
distributor at their principal address, they are and shall be fully protected
in assuming that the Plan has not been amended or terminated and in dealing
with any party acting as Trustee according to the latest information which they
have received at their home office or principal address.

SECTION 9.05--EMPLOYMENT STATUS.

         Nothing contained in this Plan gives an Employee the right to be
retained in the Employer's employ or to interfere with the Employer's right to
discharge any Employee.

SECTION 9.06--RIGHTS TO PLAN ASSETS.

         No Employee shall have any right to or interest in any assets of the
Plan upon termination of his employment or otherwise except as specifically
provided under this Plan, and then only to the extent of the benefits payable
to such Employee in accordance with Plan provisions.

         Any final payment or distribution to a Participant or his legal
representative or to any Beneficiaries, of such Participant under the Plan
provisions shall be in full satisfaction of all claims against the Plan, the
Named Fiduciary, the Plan Administrator, the Trustee, the Insurer, and the
Employer arising under or by virtue of the Plan.

SECTION 9.07--BENEFICIARY.

         Each Participant may name a Beneficiary to receive any death benefit
that may arise out of his participation in the Plan.  The Participant may
change his Beneficiary from time to time.  Unless a qualified election has been
made, for purposes of distributing any death benefits before Retirement Date,
the Beneficiary of a Participant who has a spouse shall be the Participant's
spouse.  The Participant's Beneficiary designation and any change of
Beneficiary shall be subject to the provisions of the ELECTION PROCEDURES
SECTION of Article VI.  It is the responsibility of the Participant to give
written notice to the Insurer of the name of the Beneficiary on a form
furnished for that purpose.

         With the Employer's consent, the Plan Administrator may maintain
records of Beneficiary designations for Participants before their Retirement
Dates.  In that event, the written designations made by Participants shall be
filed with the Plan Administrator.  If a Participant dies before his Retirement
Date, the Plan Administrator shall certify to the Insurer the Beneficiary
designation on its records for the Participant.

         If, at the death of a Participant, there is no Beneficiary named or
surviving, any death benefit under the Group Contract shall be paid under the
applicable provisions of the Group Contract.

SECTION 9.08--NONALIENATION OF BENEFITS.

         Benefits payable under the Plan are not subject to the claims of any
creditor of any Participant, Beneficiary, or spouse.  A Participant,
Beneficiary or spouse does not have any rights to alienate, anticipate,
commute, pledge, encumber or assign any of such benefits, except in the case of
a loan as provided in the LOANS TO PARTICIPANTS SECTION of Article V.  The
preceding sentences shall also apply to the creation, assignment, or
recognition of a right to any benefit payable with respect to a Participant
according to a domestic relations order, unless such order is determined by the
Plan Administrator to be a qualified domestic relations order, as defined in
Code Section 414(p), or any domestic relations order entered before January 1,
1985.





ARTICLE IX                        57
<PAGE>   58
SECTION 9.09--CONSTRUCTION.

         The validity of the Plan or any of its provisions is determined under
and construed according to Federal law and, to the extent permissible,
according to the laws of the state in which the Employer has its principal
office.  In case any provision of this Plan is held illegal or invalid for any
reason, such determination shall not affect the remaining provisions of this
Plan, and the Plan shall be construed and enforced as if the illegal or invalid
provision had never been included.

         In the event of any conflict between the provisions of the Plan and
the terms of any contract or policy issued hereunder, the provisions of the
Plan control the operation and administration of the Plan.

SECTION 9.10--LEGAL ACTIONS.

         The Plan, the Plan Administrator, the Trustee and the Named Fiduciary
are the necessary parties to any action or proceeding involving the assets held
with respect to the Plan or administration of the Plan or Trust.  No person
employed by the Employer, no Participant, former Participant or their
Beneficiaries or any other person having or claiming to have an interest in the
Plan is entitled to any notice of process.  A final judgment entered in any
such action or proceeding shall be binding and conclusive on all persons having
or claiming to have an interest in the Plan.

SECTION 9.11--SMALL AMOUNTS.

         If the Vested Account of a Participant has never exceeded $3,500
($5,000 for Plan Years beginning after December 31, 1997), the entire Vested
Account shall be payable in a single sum as of the earliest of his Retirement
Date, the date he dies, or the date he ceases to be an Employee for any other
reason.  This is a small amounts payment.  If a small amount is payable as of
the date the Participant dies, the small amounts payment shall be made to the
Participant's Beneficiary.  If a small amount is payable while the Participant
is living, the small amounts payment shall be made to the Participant.  The
small amounts payment is in full settlement of all benefits otherwise payable.

         No other small amounts payments shall be made.

SECTION 9.12--WORD USAGE.

         The masculine gender, where used in this Plan, shall include the
feminine gender and the singular words as used in this Plan may include the
plural, unless the context indicates otherwise.

SECTION 9.13--TRANSFERS BETWEEN PLANS.

         If an Employee previously participated in another plan of the Employer
which credited service under the elapsed time method for any purpose which
under this Plan is determined using the hours method, then the Employee's
service shall be equal to the sum of (a), (b) and (c) below:

         (a)     The number of whole years of service credited to him under the
                 other plan as of the date he became an Eligible Employee under
                 this Plan.

         (b)     One year or a part of a year of service for the applicable
                 service period in which he became an Eligible Employee if he
                 is credited with the required number of Hours-of-Service.  If
                 the Employer does not have sufficient records to determine the
                 Employee's actual Hours-of-Service in that part of the service
                 period before the date he became an Eligible Employee, the
                 Hours-of-Service shall be determined using an equivalency.
                 For any month in which he would be required to be credited
                 with one Hour-of-Service, the Employee shall be deemed for
                 purposes of this section to be credited with 190





ARTICLE IX                          58
<PAGE>   59
                 Hours-of-Service.

         (c)     The Employee's service determined under this Plan using the
                 hours method after the end of the applicable service period in
                 which he became an Eligible Employee.

         If an Employee previously participated in another plan of the Employer
which credited service under the hours method for any purpose which under this
Plan is determined using the elapsed time method, then the Employee's service
shall be equal to the sum of (d), (e) and (f) below:

         (d)     The number of whole years of service credited to him under the
                 other plan as of the beginning of the applicable service
                 period under that plan in which he became an Eligible Employee
                 under this Plan.

         (e)     The greater of (1) the service that would be credited to him
                 for that entire service period using the elapsed time method
                 or (2) the service credited to him under the other plan as of
                 the date he became an Eligible Employee under this Plan.

         (f)     The Employee's service determined under this Plan using the
                 elapsed time method after the end of the applicable service
                 period under the other plan in which he became an Eligible
                 Employee.

         Any modification of service contained in this Plan shall be applicable
to the service determined pursuant to this section.

         If the Employee previously participated in the plan of a Controlled
Group member which credited service under a different method than is used in
this Plan, for purposes of determining eligibility and vesting the provisions
above shall apply as though the plan of the Controlled Group member were a plan
of the Employer.





ARTICLE IX                           59
<PAGE>   60
                                   ARTICLE X

                          TOP-HEAVY PLAN REQUIREMENTS

SECTION 10.01--APPLICATION.

         The provisions of this article shall supersede all other provisions in
the Plan to the contrary.

         For the purpose of applying the Top-heavy Plan requirements of this
article, all members of the Controlled Group shall be treated as one Employer.
The term Employer as used in this article shall be deemed to include all
members of the Controlled Group unless the term as used clearly indicates only
the Employer is meant.

         The accrued benefit or account of a participant which results from
deductible voluntary contributions shall not be included for any purpose under
this article.

         The minimum vesting and contribution provisions of the MODIFICATION OF
VESTING REQUIREMENTS and MODIFICATION OF CONTRIBUTIONS SECTIONS of Article X
shall not apply to any Employee who is included in a group of Employees covered
by a collective bargaining agreement which the Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and one or
more employers, including the Employer, if there is evidence that retirement
benefits were the subject of good faith bargaining between such
representatives.  For this purpose, the term "employee representatives" does
not include any organization more than half of whose members are employees who
are owners, officers, or executives.

SECTION 10.02--DEFINITIONS.

         The following terms are defined for purposes of this article.

         Aggregation Group means

         (a)     each of the Employer's retirement plans in which a Key
                 Employee is a participant during the Year containing the
                 Determination Date or one of the four preceding Years,

         (b)     each of the Employer's other retirement plans which allows the
                 plan(s) described in (a) above to meet the nondiscrimination
                 requirement of Code Section 401(a)(4) or the minimum coverage
                 requirement of Code Section 410, and

         (c)     any of the Employer's other retirement plans not included in
                 (a) or (b) above which the Employer desires to include as part
                 of the Aggregation Group.  Such a retirement plan shall be
                 included only if the Aggregation Group would continue to
                 satisfy the requirements of Code Section 401(a)(4) and Code
                 Section 410.

         The plans in (a) and (b) above constitute the "required" Aggregation
         Group.  The plans in (a), (b) and (c) above constitute the
         "permissive" Aggregation Group.

         Compensation means, as to an Employee for any period, compensation as
         defined in the CONTRIBUTION LIMITATION SECTION of Article III.  For
         purposes of determining who is a Key Employee, Compensation shall
         include, in addition to compensation as defined in the CONTRIBUTION
         LIMITATION SECTION of





ARTICLE IX                         60
<PAGE>   61
         Article III, elective contributions.  Elective contributions are
         amounts excludable from the Employee's gross income under Code
         Sections 125, 402(e)(3), 402(h) or 403(b), and contributed by the
         Employer, at the Employee's election, to a Code Section 401(k)
         arrangement, a simplified employee pension, cafeteria plan or
         tax-sheltered annuity.

         For purposes of Compensation as defined in this section, Compensation
         shall be limited in the same manner and in the same time as the
         Compensation defined in the DEFINITION SECTION of Article I.

         Determination Date means as to this Plan for any Year, the last day of
         the preceding Year.  However, if there is no preceding Year, the
         Determination Date is the last day of such Year.

         Key Employee means any Employee or former Employee (including
         Beneficiaries of deceased Employees) who at any time during the
         determination period was

         (a)     one of the Employer's officers (subject to the maximum below)
                 whose Compensation (as defined in this section) for the Year
                 exceeds 50 percent of the dollar limitation under Code Section
                 415(b)(1)(A),

         (b)     one of the ten Employees who owns (or is considered to own,
                 under Code Section 318) more than a half percent ownership
                 interest and one of the largest interests in the Employer
                 during any Year of the determination period if such person's
                 Compensation (as defined in this section) for the Year exceeds
                 the dollar limitation under Code Section 415(c)(1)(A),

         (c)     a five-percent owner of the Employer, or

         (d)     a one-percent owner of the Employer whose Compensation (as
                 defined in this section) for the Year is more than $150,000.

         Each member of the Controlled Group shall be treated as a separate
         employer for purposes of determining ownership in the Employer.

         The determination period is the Year containing the Determination Date
         and the four preceding Years.  If the Employer has fewer than 30
         Employees, no more than three Employees shall be treated as Key
         Employees because they are officers.  If the Employer has between 30
         and 500 Employees, no more than ten percent of the Employer's
         Employees (if not an integer, increased to the next integer) shall be
         treated as Key Employees because they are officers.  In no event will
         more than 50 Employees be treated as Key Employees because they are
         officers if the Employer has 500 or more Employees.  The number of
         Employees for any Plan Year is the greatest number of Employees during
         the determination period.  Officers who are employees described in
         Code Section 414(q)(8) shall be excluded.  If the Employer has more
         than the maximum number of officers to be treated as Key Employees,
         the officers shall be ranked by amount of annual Compensation (as
         defined in this section), and those with the greater amount of annual
         Compensation during the determination period shall be treated as Key
         Employees.  To determine the ten Employees owning the largest
         interests in the Employer, if more than one Employee has the same
         ownership interest, the Employee(s) having the greater annual
         Compensation shall be treated as owning the larger interest(s).  The
         determination of who is a Key Employee shall be made according to Code
         Section 416(i)(1) and the regulations thereunder.





ARTICLE IX                         61
<PAGE>   62
         Non-key Employee means a person who is a non-key employee within the
         meaning of Code Section 416 and regulations thereunder.

         Present Value means the present value of a participant's accrued
         benefit under a defined benefit plan as of his normal retirement age
         (attained age if later) or, if the plan provides non-proportional
         subsidies, the age at which the benefit is most valuable.  The accrued
         benefit of any Employee (other than a Key Employee) shall be
         determined under the method which is used for accrual purposes for all
         plans of the Employer or if there is no one method which is used for
         accrual purposes for all plans of the Employer, as if such benefit
         accrued not more rapidly than the slowest accrual rate permitted under
         Code Section 411(b)(1)(C).  For purposes of establishing Present
         Value, any benefit shall be discounted only for 7.5% interest and
         mortality according to the 1971 Group Annuity Table (Male) without the
         7% margin but with projection by Scale E from 1971 to the later of (a)
         1974, or (b) the year determined by adding the age to 1920, and
         wherein for females the male age six years younger is used.  If the
         Present Value of accrued benefits is determined for a participant
         under more than one defined benefit plan included in the Aggregation
         Group, all such plans shall use the same actuarial assumptions to
         determine the Present Value.

         Top-heavy Plan means a plan which is a top-heavy plan for any plan
         year beginning after December 31, 1983.  This Plan shall be a
         Top-heavy Plan if

         (a)     the Top-heavy Ratio for this Plan alone exceeds 60 percent and
                 this Plan is not part of any required Aggregation Group or
                 permissive Aggregation Group.

         (b)     this Plan is a part of a required Aggregation Group, but not
                 part of a permissive Aggregation Group, and the Top-heavy
                 Ratio for the required Aggregation Group exceeds 60 percent.

         (c)     this Plan is a part of a required Aggregation Group and part
                 of a permissive Aggregation Group and the Top-heavy Ratio for
                 the permissive Aggregation Group exceeds 60 percent.

         Top-heavy Ratio means the ratio calculated below for this Plan or for
         the Aggregation Group.

         (a)     If the Employer maintains one or more defined contribution
                 plans (including any simplified employee pension plan) and the
                 Employer has not maintained any defined benefit plan which
                 during the five-year period ending on the determination date
                 has or has had accrued benefits, the Top-heavy Ratio for this
                 Plan alone or for the required or permissive Aggregation Group
                 as appropriate is a fraction, the numerator of which is the
                 sum of the account balances of all Key Employees as of the
                 determination date and the denominator of which is the sum of
                 all account balances of all employees as of the determination
                 date.  Both the numerator and denominator of the Top-heavy
                 Ratio are adjusted for any distribution of an account balance
                 (including those made from terminated plan(s) of the Employer
                 which would have been part of the required Aggregation Group
                 had such plan(s) not been terminated) made in the five-year
                 period ending on the determination date.  Both the numerator
                 and denominator of the Top-heavy Ratio are increased to
                 reflect any contribution not actually made as of the
                 Determination Date, but which is required to be taken into
                 account on that date under Code Section 416 and the
                 regulations thereunder.

         (b)     If the Employer maintains one or more defined contribution
                 plans (including any simplified employee pension plan) and the
                 Employer maintains or has maintained one or more defined
                 benefit plans which during the five-year period ending on the
                 determination date has or has had accrued benefits,





ARTICLE IX                               62
<PAGE>   63
                 the Top-heavy Ratio for any required or permissive Aggregation
                 Group as appropriate is a fraction, the numerator of which is
                 the sum of the account balances under the defined contribution
                 plan(s) of all Key Employees and the Present Value of accrued
                 benefits under the defined benefit plan(s) for all Key
                 Employees, and the denominator of which is the sum of the
                 account balances under the defined contribution plan(s) for
                 all employees and the Present Value of accrued benefits under
                 the defined benefit plans for all employees.  Both the
                 numerator and denominator of the Top-heavy Ratio are adjusted
                 for any distribution of an account balance or an accrued
                 benefit (including those made from terminated plan(s) of the
                 Employer which would have been part of the required
                 Aggregation Group had such plan(s) not been terminated) made
                 in the five-year period ending on the determination date.

         (c)     For purposes of (a) and (b) above, the value of account
                 balances and the Present Value of accrued benefits will be
                 determined as of the most recent valuation date that falls
                 within or ends with the 12-month period ending on the
                 determination date, except as provided in Code Section 416 and
                 the regulations thereunder for the first and second plan years
                 of a defined benefit plan.  The account balances and accrued
                 benefits of an employee who is not a Key Employee but who was
                 a Key Employee in a prior year will be disregarded.  The
                 calculation of the Top-heavy Ratio and the extent to which
                 distributions, rollovers and transfers during the five-year
                 period ending on the determination date are to be taken into
                 account, shall be determined according to the provisions of
                 Code Section 416 and regulations thereunder.  The account
                 balances and accrued benefits of an individual who has
                 performed no service for the Employer during the five-year
                 period ending on the determination date shall be excluded from
                 the Top-heavy Ratio until the time the individual again
                 performs service for the Employer.  Deductible employee
                 contributions will not be taken into account for purposes of
                 computing the Top-heavy Ratio.  When aggregating plans, the
                 value of account balances and accrued benefits will be
                 calculated with reference to the determination dates that fall
                 within the same calendar year.

         Account, as used in this definition, means the value of an employee's
         account under one of the Employer's retirement plans on the latest
         valuation date.  In the case of a money purchase plan or target
         benefit plan, such value shall be adjusted to include any
         contributions made for or by the employee after the valuation date and
         on or before such determination date or due to be made as of such
         determination date but not yet forwarded to the insurer or trustee.
         In the case of a profit sharing plan, such value shall be adjusted to
         include any contributions made for or by the employee after the
         valuation date and on or before such determination date.  During the
         first Year of any profit sharing plan such adjustment in value shall
         include contributions made after such determination date that are
         allocated as of a date in such Year.  The nondeductible employee
         contributions which an employee makes under a defined benefit plan of
         the Employer shall be treated as if they were contributions under a
         separate defined contribution plan.

         Valuation Date means, as to this Plan, the last day of the last
         calendar month ending in a Year.

         Year means the Plan Year unless another year is specified by the
         Employer in a separate written resolution in accordance with
         regulations issued by the Secretary of the Treasury or his delegate.

SECTION 10.03--MODIFICATION OF VESTING REQUIREMENTS.

         If a Participant's Vesting Percentage determined under Article I is
not at least as great as his Vesting Percentage would be if it were determined
under a schedule permitted in Code Section 416, the following shall





ARTICLE IX                        63
<PAGE>   64
apply.  During any Year in which the Plan is a Top-heavy Plan, the
Participant's Vesting Percentage shall be the greater of the Vesting Percentage
determined under Article I or the schedule below.


<TABLE>
<CAPTION>
              ------------------------------------------
                 VESTING SERVICE      NONFORFEITABLE
              ------------------------------------------
                 <S>                 <C> 
                   Less than 2              0
              ------------------------------------------
                       2                   20
              ------------------------------------------
                       3                   40
              ------------------------------------------
                       4                   60
              ------------------------------------------
                       5                   80
              ------------------------------------------
                  6 or more               100
              ------------------------------------------
       

</TABLE>

         The schedule above shall not apply to Participants who are not
credited with an Hour-of-Service after the Plan first becomes a Top-heavy Plan.
The Vesting Percentage determined above applies to all of the Participant's
Account resulting from Employer Contributions, including Contributions the
Employer makes before the TEFRA Compliance Date or when the Plan is not a
Top-heavy Plan.

         If, in a later Year, this Plan is not a Top-heavy Plan, a
Participant's Vesting Percentage shall be determined under Article I.  A
Participant's Vesting Percentage determined under either Article I or the
schedule above shall never be reduced and the election procedures of the
AMENDMENTS SECTION of Article IX shall apply when changing to or from the
schedule as though the automatic change were the result of an amendment.

         The part of the Participant's Vested Account resulting from the
minimum contributions required pursuant to the MODIFICATION OF CONTRIBUTIONS
SECTION of Article X shall not be forfeited because of a period of reemployment
after benefit payments have begun.

SECTION 10.04--MODIFICATION OF CONTRIBUTIONS.

         During any Year in which this Plan is a Top-heavy Plan, the Employer
shall make a minimum contribution or allocation on the last day of the Year for
each person who is a Non-key Employee on that day and who either was or could
have been an Active Participant during the Year.  A Non-key Employee is not
required to have a minimum number of hours-of-service or minimum amount of
Compensation, or to have had any Elective Deferral Contributions made for him
in order to be entitled to this minimum.  The minimum contribution or
allocation for such person shall be equal to the lesser of (a) or (b) below:

         (a)     Three percent of such person's Compensation (as defined in this
                 article).

         (b)     The "highest percentage" of Compensation (as defined in this
                 article) for such Year at which the Employer's contributions
                 are made for or allocated to any Key Employee.  The highest
                 percentage shall be determined by dividing the Employer
                 Contributions made for or allocated to each Key Employee
                 during such Year by the amount of his Compensation (as defined
                 in this article), which is not more than the maximum set out
                 above, and selecting the greatest quotient (expressed as a
                 percentage).  To determine the highest percentage, all of the
                 Employer's defined contribution plans within the Aggregation
                 Group shall be treated as one plan.  The provisions of this
                 paragraph shall not apply if this Plan and a defined benefit
                 plan of the Employer are required to be included in the
                 Aggregation Group and this Plan enables the defined benefit
                 plan to meet the requirements of Code Section 401(a)(4) or
                 Code Section 410.

         If the Employer's contributions and allocations otherwise required
under the defined contribution plan(s) are at





ARTICLE IX                          64
<PAGE>   65
least equal to the minimum above, no additional contribution or reallocation
shall be required.  If the Employer's contributions and allocations are less
than the minimum above and Employer Contributions under this Plan are allocated
to Participants, any Employer Contributions (other than those which are
allocated on the basis of the amount made for such person) shall be reallocated
to provide the minimum.  The remaining Contributions shall be allocated as
provided in the preceding articles of this Plan taking into account any amount
which was reallocated to provide the minimum.  If the Employer's total
contributions and allocations are less than the minimum above after any
reallocation provided above, the Employer shall contribute the difference for
the Year.

         The minimum contribution or allocation applies to all of the
Employer's defined contribution plans in the aggregate which are Top-heavy
Plans.  If an additional contribution or allocation is required to meet the
minimum above, it shall be provided in this Plan.

         A minimum allocation under a profit sharing plan shall be made without
regard to whether or not the Employer has profits.

         If a person who is otherwise entitled to a minimum contribution or
allocation above is also covered under a defined benefit plan of the Employer's
which is a Top-heavy Plan during that same Year, the minimum benefits for him
shall not be duplicated.  The defined benefit plan shall provide an annual
benefit for him on, or adjusted to, a straight life basis of the lesser of (c)
two percent of his average pay multiplied by his years of service or (d) twenty
percent of his average pay.  Average pay and years of service shall have the
meaning set forth in such defined benefit plan for this purpose.

         For purposes of this section, any employer contribution made according
to a salary reduction or similar arrangement shall not apply before the first
Yearly Date in 1985.  On and after the first Yearly Date in 1989, any such
employer contributions and employer contributions which are matching
contributions, as defined in Code Section 401(m), shall not apply in
determining if the minimum contribution requirement has been met, but shall
apply in determining the minimum contribution required.  Forfeitures credited
to a Participant's Account are treated as employer contributions.

         The requirements of this section shall be met without regard to
contributions under Chapter 2 of the Code (relating to tax on self-employment),
Chapter 21 of the Code (relating to Federal Insurance Contributions Act), Title
II of the Social Security Act or any other Federal or state law.

SECTION 10.05--MODIFICATION OF CONTRIBUTION LIMITATION.

         If the provisions of subsection (e) of the CONTRIBUTION LIMITATION
SECTION of Article III are applicable for any Limitation Year during which this
Plan is a Top-heavy Plan, the benefit limitations shall be modified.  The
definitions of Defined Benefit Plan Fraction and Defined Contribution Plan
Fraction in the CONTRIBUTION LIMITATION SECTION of Article III shall be
modified by substituting "1.0" in lieu of "1.25."  The optional denominator for
determining the Defined Contribution Plan Fraction shall be modified by
substituting "$41,500" in lieu of "$51,875."  In addition, an adjustment shall
be made to the numerator of the Defined Contribution Plan Fraction.  The
adjustment is a reduction of that numerator similar to the modification of the
Defined Contribution Plan Fraction described in the CONTRIBUTION LIMITATION
SECTION of Article III, and shall be made with respect to the last Plan Year
beginning before January 1, 1984.

         The modifications in the paragraph above shall not apply with respect
to a Participant so long as employer contributions, forfeitures or
nondeductible employee contributions are not credited to his account under this
or any





ARTICLE IX                        65
<PAGE>   66
of the Employer's other defined contribution plans and benefits do not accrue
for such Participant under the Employer's defined benefit plan(s), until the
sum of his Defined Contribution and Defined Benefit Plan Fractions is less than
1.0.





ARTICLE IX                        66
<PAGE>   67
         By executing this Plan, the Primary Employer acknowledges having
counseled to the extent necessary with selected legal and tax advisors
regarding the Plan's legal and tax implications.


         Executed this 30th day of December, 1997.


                                             CRESCENT REAL ESTATE EQUITIES, LTD.


                                             By:  /s/ BRUCE A. PICKER
                                                 -------------------------------

                                                  Vice-President and Treasurer
                                             -----------------------------------
                                                              Title





PLAN EXECUTION                         67
<PAGE>   68
                    FIRST AMENDMENT TO CRESCENT REAL ESTATE
                   EQUITIES, LTD. FIRST AMENDED AND RESTATED
                                  401(k) PLAN
                (ADOPTED BY WRITTEN CONSENT OF THE SOLE DIRECTOR
                    IN LIEU OF MEETING ON SEPTEMBER 1, 1998)

         Page 22 of the Crescent Real Estate Equities, Ltd. First Amended and
Restated 401(k) Plan is hereby deleted and replaced with the following: 

                           *     *     *     *     *

                                   ARTICLE III

                                  CONTRIBUTIONS

SECTION 3.01 - EMPLOYER CONTRIBUTIONS

         Employer Contributions for Plan Years which end on or after March 17,
1997, may be made without regard to current or accumulated net income, earnings,
or profits of the Employer. Notwithstanding the foregoing, the Plan shall
continue to be designed to qualify as a profit sharing plan for purposes of Code
Sections 401(a), 402, 412, and 417. Such Contributions will be equal to the
Employer Contributions as described below:

         (a)      The amount of each Elective Deferral Contribution for a
                  Participant shall be equal to any percentage (not less than 1%
                  nor more than 25%) of his Compensation for the pay period as
                  elected in his elective deferral agreement. An Employee who is
                  eligible to participate in the Plan may file an elective
                  deferral agreement with the Employer. The elective deferral
                  agreement to start Elective Deferral Contributions may be
                  effective on a Participant's Entry Date (Reentry Date, if
                  applicable) or any following Quarterly Date. The Participant
                  shall make any change or terminate the elective deferral
                  agreement by filing a new elective deferral agreement. A
                  Participant's elective deferral agreement making a change may
                  be effective on any date an elective deferral agreement to
                  start Elective Deferral Contributions could be effective. A
                  Participant's elective deferral agreement to stop Elective
                  Deferral Contributions may be effective on any date. The
                  elective deferral agreement must be in writing and effective
                  before the beginning of the pay period in which Elective
                  Deferral Contributions are to start, change or stop.

                  Elective Deferral Contributions are fully (100%) vested and
                  nonforfeitable.

         (b)      The amount of each Matching Contribution for a Participant,
                  shall be equal to the percentage shown in the schedule below
                  based on his Years of Service and based on the amount of the
                  Elective Deferral Contributions made for him for the calendar
                  quarter, disregarding any Elective Deferral Contributions in
                  excess of 7% of his Compensation for the calendar quarter.


<TABLE>
<CAPTION>
                          
                       Years of Service                Percentage Matched
                      <S>                                 <C>
                       Less than 2                         25%
                       2                                   50%
                       3                                   75%
                       4 or more                           100%
</TABLE>

                  Notwithstanding the foregoing, for Participants who met the
                  eligibility requirements of Article II before September 1,
                  1998, the Percentage Matched shall be determined in accordance
                  with the following:

<TABLE>
<CAPTION>
                       Elective Deferral Period                  Percentage Matched
                      <S>                                             <C>
                       September 1, 1998 through August 31, 1999      25%
                       September 1, 1999 through August 31, 2000      50%
                       September 1, 2000 through August 31, 2001      75%
                       after September 1, 2001                        100%
</TABLE>

                  Matching Contributions shall be made only on behalf of
                  Participants who are actively employed on the last day of the
                  calendar quarter to which the Matching Contribution relates.
                  Matching Contributions are subject to the Vesting Percentage.

         (c)      The amount of each Qualified Nonelective Contribution shall be
                  determined by the Employer. A Qualified Nonelective
                  Contribution shall be made for a Participant only if he is a
                  Nonhighly Compensated Employee or a Non-key Employee (as
                  defined in Article X).

                  Qualified Nonelective Contributions are fully (100%) vested
                  and nonforfeitable.

         (d)      The amount of each Discretionary Contribution shall be
                  determined by the Employer.

                  Discretionary Contributions are subject to the Vesting
                  Percentage.

         No participant shall be permitted to have Elective Deferral
Contributions, as defined in the EXCESS AMOUNTS section of Article III, made
under this Plan, or any other qualified plan maintained by the Employer,



ARTICLE III                           22