CITIZENS 401(K) SAVINGS PLAN

                             AS ADOPTED APRIL, 2001

                         EFFECTIVE AS OF JANUARY 1, 1997

                REFLECTING AMENDMENTS MADE THROUGH APRIL 1, 2001


                   Amended and Restated In compliance with the
        Uniformed Services Employment and Reemployment Rights Act of 1994
                  The Small Business Job Protection Act of 1996
                         The Taxpayer Relief Act of 1997
                                     And the
          Internal Revenue Service Restructuring and Reform Act of 1998






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                                TABLE OF CONTENTS
                                                                                                               Page No.
<S>                                                                                                              <C>
ARTICLE I.........................................................................................................1
      ESTABLISHMENT OF PLAN.......................................................................................1
      1.01  Establishment and History of Plan.....................................................................1
      1.02  Purpose of Plan.......................................................................................1
      1.03  Nature of Plan........................................................................................1
      1.04  Internal Revenue Service Approval.....................................................................1
ARTICLE II........................................................................................................2
      ELIGIBILITY FOR PARTICIPATION...............................................................................2
      2.01  Eligible and Ineligible Classes of Employees..........................................................2
      2.02  Participation On the Effective Date...................................................................3
      2.03  General Participation Rule............................................................................3
      2.04  Transfer In or Out of Eligible Class of Employees.....................................................4
      2.05  Rehired Employees.....................................................................................4
      2.06  Misclassification or Mistake of Fact..................................................................4
      2.07  Absence From Employment...............................................................................4
ARTICLE III.......................................................................................................5
      FUNDING.....................................................................................................5
      3.01  Funding Policy........................................................................................5
      3.02  Contributions.........................................................................................6
      3.03  Reversion of Contributions to the Company.............................................................9
      3.04  Participant Contributions............................................................................10
      3.05  Forfeitures..........................................................................................10
      3.06  Investment of Contributions..........................................................................11
      3.07  Expenses of Plan Amendment and Administration........................................................14
      3.08  Fund is Sole Source of Benefits......................................................................15
      3.09  Rollover Contributions...............................................................................15
      3.10  Transfers............................................................................................16
      3.11  Suspension of Salary Reduction Agreements............................................................16
ARTICLE IV.......................................................................................................17
      ALLOCATIONS AND ACCOUNT BALANCES...........................................................................17
      4.01  Books and Records to Show Account Balances...........................................................17
      4.02  Separate Accounts Maintained.........................................................................17
      4.03  Allocation of Contributions..........................................................................18
      4.04  Valuation and Allocation of the Fund.................................................................19
      4.05  Account Balance Subject to Change Until Distributed..................................................19
ARTICLE V........................................................................................................20
      BENEFITS AND VESTING.......................................................................................20
      5.01  Benefits Are Based on Account Balances...............................................................20
      5.02  Vesting In Salary Reduction Account Balances; Vesting In TRASOP; LGS; Voluntary After-Tax and Rollover
            Account Balances ....................................................................................20
      5.03  Normal Retirement Benefits...........................................................................20
      5.04  Benefits Before Termination of Employment............................................................20
      5.05  Deferred Retirement Benefits.........................................................................22
      5.06  Disability Benefits..................................................................................23
      5.07  Death Benefits.......................................................................................23
      5.08  Benefits Following Termination of Employment.........................................................23
      5.09  Changes in Vesting Provisions........................................................................26
      5.10  Loans to Participants and Beneficiaries..............................................................26
<PAGE>

ARTICLE VI.......................................................................................................30
      PAYMENT OF BENEFITS........................................................................................30
      6.01  General Rules for Payment............................................................................30
      6.02  Commencement of Benefits.............................................................................34
      6.03  Form of Payment......................................................................................34
      6.04  Designation of Beneficiaries.........................................................................34
      6.05  Payments to Minors or Incompetents...................................................................36
      6.06  Suspension of Benefits Upon Reemployment.............................................................36
      6.07  Discharge of Obligation; Receipt and Release.........................................................36
      6.08  Nonalienation of Benefits............................................................................37
      6.09  Benefit Claims Procedures............................................................................37
      6.10  Qualified Domestic Relations Order Procedures........................................................38
      6.11  Unclaimed Benefits...................................................................................40
ARTICLE VII......................................................................................................40
      LIMITATIONS ON CONTRIBUTIONS AND BENEFITS..................................................................40
      7.01  Limitation on Defined Contribution Plan Annual Additions.............................................40
      7.02  Overall Limitation on Defined Benefit and Defined Contribution Plan Benefits.........................41
      7.03  Benefit Reductions to Meet Annual Addition Limitations...............................................43
      7.04  Handling of Forfeitures Caused by Annual Additions Limitation........................................44
      7.05  Salary Reductions in Excess of Permissible Dollar Limits.............................................45
      7.06  Limitations on Salary Reduction Contributions........................................................46
      7.07  Average Contribution Percentage Test for Company Matching Contributions..............................51
      Section 7.08  Multiple Use Limitation......................................................................55
ARTICLE VIII.....................................................................................................57
      TOP-HEAVY REQUIREMENTS.....................................................................................57
      8.01  When Top-Heavy Provisions Are Operative..............................................................57
      8.02  Top-Heavy Limitation on Annual Compensation..........................................................57
      8.03  Top-Heavy Minimum Contributions......................................................................57
      8.04  Top-Heavy Minimum Vesting............................................................................59
      8.05  Top-Heavy Limitations on Benefits....................................................................59
      8.06  Determination of Top Heavy Status....................................................................60
ARTICLE IX.......................................................................................................61
      AMENDMENT, MERGER OR TERMINATION...........................................................................61
      9.01  Amendment............................................................................................61
      9.02  Merger or Consolidation..............................................................................62
      9.03  Termination..........................................................................................62
      9.04  Termination Distributions............................................................................62
ARTICLE X........................................................................................................63
      PLAN FIDUCIARIES AND ADMINISTRATION........................................................................63
      10.01  Administration by Named Fiduciaries.................................................................63
      10.02  Retirement and Investment Committees................................................................63
      10.03  Retirement Committee To Be Plan Administrator; Duties, Powers and Authority of Plan Administrator...65
      10.04  Duties, Powers and Authority of Investment Committee................................................65
      10.05 Trust Fund and Trustee...............................................................................66
      10.06  Agent for Service of Legal Process..................................................................67
      10.07  Company Actions.....................................................................................67
<PAGE>

      10.08  Communications To and From Plan Fiduciaries.........................................................67
      10.09 Multiple Capacities; Fiduciary Duties................................................................67
      10.10  Reliance; Fiduciary Liability; Exoneration..........................................................68
      10.11  Indemnification of Fiduciaries......................................................................69
      10.12  Bonding.............................................................................................69
      10.13 Voting of Company Stock..............................................................................69
ARTICLE XI.......................................................................................................72
      PARTICIPATING EMPLOYERS....................................................................................72
      11.01  Application of Plan to Participating Employers......................................................72
      11.02  Adoption of Plan....................................................................................72
      11.03  Extent of Participation.............................................................................72
      11.04  Transfer of Employees Among Employers...............................................................73
      11.05  Plan Administration and Expenses....................................................................73
      11.06  Plan Amendment......................................................................................74
      11.07  Termination of an Employer's Participation..........................................................74
      11.08  Restrictions on Amendments, Mergers or Terminations by Employers....................................75
ARTICLE XII......................................................................................................75
      MISCELLANEOUS PROVISIONS...................................................................................75
      12.01  Plan for Exclusive Benefit of Employees.............................................................75
      12.02  Rights of Participants Not Expanded.................................................................75
      12.03  Plan Subject to Insurance Contracts and Trusts......................................................75
      12.04  Governing Law and Savings Clause....................................................................76
      12.05  Headings............................................................................................76
      12.06  Gender and Number...................................................................................76
      12.07  Definitions.........................................................................................76
GLOSSARY.........................................................................................................77
Execution Page...................................................................................................91

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<PAGE>


                                    ARTICLE I
                              ESTABLISHMENT OF PLAN
                              ---------------------

     1.01  Establishment  and History of Plan.  Effective as of January 1, 1997,
the Citizens Utilities 401(k) Savings Plan and CUC 401(k) Employee Benefit Plan,
which  previously were maintained as separate plans,  are hereby restated herein
into a single document.  Effective as of January 1, 1998, the Citizens Utilities
401(k) Savings Plan is merged into the CUC 401(k)  Employee  Benefit Plan,  with
the  resulting  plan being  renamed  the  "Citizens  401(k)  Savings  Plan" (the
"Plan").  Effective as of October 1, 1999, the Gasco  Bargaining  401(k) Plan is
merged  into this  Plan.  Citizens  Communications  Company  (formerly  Citizens
Utilities  Company)  now hereby  amends  and  restates  the Plan to reflect  the
various plan mergers,  and to incorporate  certain  administrative  and required
legal  changes into the Plan.  The restated Plan shall be known as the "Citizens
401(k)  Savings  Plan" and shall be  maintained  for the  exclusive  benefit  of
eligible  Employees and their  Beneficiaries.  Unless  otherwise  provided,  the
provisions  of the Plan as amended and  restated  shall apply to all persons who
are eligible Employees on and after January 1, 1997.

     1.02  Purpose  of Plan.  The  purpose  of the Plan is to  provide  eligible
Employees with an opportunity and incentive to save for their  retirement and to
encourage such Employees to be productive and to make and continue  careers with
the Company by providing matching contributions.

     1.03  Nature  of  Plan.  The  Plan is  intended  to  qualify  as a  defined
contribution  profit sharing plan and trust with a qualified Code Section 401(k)
arrangement meeting the requirements of Sections 401(a),  401(k), 401(m), 501(a)
and related provisions of the Internal Revenue Code.

     1.04  Internal  Revenue  Service   Approval.   If,  as  a  result  of  this
restatement,  the Plan fails to attain or retain  qualification  under  Sections
401(a),  401(k),  401(m),  501(a) and related  provisions of the Code,  the Plan
shall  operate as though it had not been  restated as herein  provided,  and any
contribution  affected by the determination that the Plan is no longer qualified
shall be returned to the Company in accordance with Section 3.03.
<PAGE>


                                   ARTICLE II
                          ELIGIBILITY FOR PARTICIPATION
                          -----------------------------

     2.01 Eligible and Ineligible Classes of Employees.  All salaried and hourly
Employees, except those in the ineligible classes of Employees designated below,
shall be eligible to  participate in the Plan upon  completing  the  eligibility
requirements  of Section 2.02 or 2.03, as applicable.  The following  classes of
Employees shall be ineligible to participate in the Plan:

               (i) Non-Participating Collectively Bargained Employees: Employees
               included  in  a  unit  of  Employees   covered  by  a  collective
               bargaining   agreement   which   does  not   provide   for  their
               participation  in the Plan,  where such benefits were the subject
               of good faith bargaining;

               (ii) Employees of  Non-Participating  Employers:  Individuals who
               are employed by Related  Employers of the Company  which have not
               adopted the Plan for the benefit of their Employees;

               (iii)  Part-time  Employees.   Employees  who  are  scheduled  to
               regularly work fewer than 20 hours per week;

               (iv) Leased  Employees:  Individuals  who are  classified  by the
               Company as leased employees (whether or not they are considered a
               Leased  Employee  under  Code  Section   414(n)),   even  if  the
               individual  actually  is,  or is  reclassified  by  the  Internal
               Revenue Service as, a common law employee of the Company;

               (v) Project Workers; Independent Contractors or Contract Workers:
               Individuals  who are  classified  by the Company in good faith as
               independent  contractors  or contract  workers and not common law
               employees,  as  evidenced  by the fact  that the  Company  is not
               paying such individuals  through the Company's  payroll system or
               withholding  taxes  from  his or her  compensation,  even  if the
               individual  actually  is,  or is  reclassified  by  the  Internal
               Revenue Service as, a common law employee of the Company;
<PAGE>

               (vi) Per Diem or Casual  Workers:  Individuals who are classified
               by the  Company as per diem or casual and who work only on an "as
               needed basis";

               (vii) Temporary Employees:  Individuals who are classified by the
               Company as employed on a temporary basis and paid through Company
               payroll,  provided that their employment does not continue beyond
               one (1) year;

               (viii)  Scholarship  Students:  Individuals  who are  scholarship
               recipients  performing  services  for the  Company as part of the
               Citizens' Scholarship Program; and

               (ix) Individuals Waiving Participation:  Any individuals who have
               knowingly  waived  their  right to  participate  in the Plan,  as
               evidenced by a written agreement to that effect.

During any  period  when an  Employee  is  included  in an  ineligible  class of
Employees,  he shall be ineligible  to become a  Participant  in the Plan, or if
otherwise  a  Participant,   shall  be  ineligible  to  make  Salary   Reduction
Contributions and share in Company Matching Contributions.

     2.02  Participation  On the Effective Date.  Each Employee  employed by the
Company as of January 1, 1997, the Effective  Date of the Restated  Plan,  shall
continue  to  participate  or, if not  already  a  Participant,  shall  become a
Participant  on the  Effective  Date,  provided  such  Employee has attained age
twenty-one  (21),  completed  30 days of  service,  is in an  eligible  class of
Employees, and is employed by a Participating Employer.

     2.03  General   Participation  Rule.  Each  other  Employee  not  otherwise
participating  under Section 2.02,  shall be eligible to become a Participant as
of the first day of the month (the "Entry Date")  immediately  following the (I)
the Employee's  attainment of age  twenty-one  (21) and completion of 30 days of
service,  if the  Employee  is hired  before  January  1,  1998,  or (II) if the
Employee is hired on or after January 1, 1998, the Employee's  completion of six
(6) months of  continuous  service,  provided  that the  Employee  is  regularly
scheduled  to work at least  twenty  (20) hours per week,  and is  employed by a
Participating Employer in an eligible class of Employees.
<PAGE>

     2.04  Transfer In or Out of  Eligible  Class of  Employees.  In the event a
Participant becomes ineligible to be an Eligible Participant in the Plan because
he is no longer a member of an eligible class of Employees,  such Employee shall
cease  active  participation,  and  shall  resume  his  status  as  an  Eligible
Participant  under the Plan  immediately upon his return to an eligible class of
Employees. In the event an Employee who is not a member of the eligible class of
Employees becomes a member of the eligible class, if such Employee has otherwise
satisfied the participation  requirements of Section 2.03 hereof,  such Employee
shall commence  participation  in the Plan immediately upon becoming a member of
the eligible class. If such Employee has not satisfied the Plan's  participation
requirements,  participation shall commence in accordance with the provisions of
Section 2.03 hereof.

     2.05  Rehired  Employees.  If a rehired  Employee  meets the  participation
requirements  of Section  2.03 and is in an eligible  class of  Employees at the
time of his rehire,  he shall  become a  Participant  or resume his status as an
eligible Participant under the Plan immediately upon his rehire. If the Employee
had not met  participation  and  eligibility  requirements  as specified in this
Article prior to separation from employment,  such Employee shall be eligible to
participate  in the Plan as of the first day of the month after  completing  the
then applicable eligibility requirements.

     2.06  Misclassification  or  Mistake  of Fact.  If a  misclassification  or
mistake is made concerning the  participation of an Employee in the Plan, either
by including an ineligible Employee,  or excluding an eligible Employee,  and if
such mistake is not timely  discovered  and corrected for the Plan Year in which
it  occurred,  upon  discovery  of  such  error  in a  subsequent  Plan  Year an
adjustment to the Employee's  Account Balances shall be made. In the case of the
inclusion of an ineligible Employee,  (a) the portion of such Employee's Account
Balance  attributable  to  Salary  Reduction  Contributions  for the  period  of
ineligibility  shall be  distributed to the  individual,  and (b) the portion of
such Employee's Account Balance  attributable to Company Matching  contributions
for the period of  ineligibility  shall be returned to the Company as a mistaken
contribution in accordance with Section 3.03(a) hereof if return is requested by
the Company or Plan  Administrator  within one year of payment;  otherwise  such
amount shall be treated as a forfeiture and allocated in accordance with Section
3.05 hereof. In the case of the exclusion of an eligible  Employee,  the Company
shall correct such error prospectively as soon as practicable.
<PAGE>

     2.07 Absence From Employment. Absence from employment on account of a leave
of absence  authorized by the Employer  will be handled in  accordance  with the
Employer's  policies  regarding  the  particular  type of  leave.  Absence  from
employment  on account of active duty with the Armed Forces of the United States
will be counted as  employment  with the  Employer,  provided  that the Employee
returns  to  service  with the  Employer  within  the  period  during  which his
employment  rights  are  protected  by law  following  his  severance  from such
government  service.  If the Employee does not return to active  employment with
the  Employer,  his  Service  will be  deemed  to have  ceased  on the  date the
Administrator  receives  notice that such Employee will not return to the active
Service of the  Employer.  The  Employer's  leave  policy  shall be applied in a
uniform  and   nondiscriminatory   manner  to  all  Participants  under  similar
circumstances.

     Notwithstanding any provision of this plan to the contrary,  contributions,
benefits and service credit with respect to qualified  military  service will be
provided in accordance  with ss.414(u) of the Internal  Revenue Code,  effective
for  reemployments  initiated on or after  December  12,  1994.  With respect to
unpaid family and medical leave, contributions, benefits and service credit will
be  provided  in  accordance  with  29  CFR  ss.825.215,  effective  for  leaves
commencing on or after August 5, 1993.
<PAGE>

                                   ARTICLE III
                                     FUNDING
                                   -----------

     3.01  Funding  Policy.  The Company  shall  establish a funding  policy and
method  consistent with the objectives,  terms and conditions of the Plan and as
appropriate  communicate  the  same  to  other  Plan  Administrator.   The  Plan
Administrator  shall  arrange  for the  establishment  and  maintenance  of such
funding  accounts as may be required by ERISA or appropriate in connection  with
the administration of the Plan.

     3.02 Contributions.
          -------------

               (a) Amount of Contributions.  Each  Participating  Employer shall
          contribute the following amounts without regard to whether the Company
          has current or  accumulated  income for the period  during  which such
          amounts are being  contributed  and  without  regard to the age of the
          Participant.

                    (1)  Salary  Reduction  Contributions  for  Employees.
                         -------------------------------------------------
               Any Participant may elect to have the Participating Employer make
               Salary Reduction Contributions to the Plan with respect to a Plan
               Year in whole percentages of Compensation in an amount of no less
               than one percent (1%) of such  Participant's  Compensation and no
               more than the least of the following amounts:

                         (i)  sixteen   percent   (16%)  of  the   Participant's
                    Compensation for such Plan Year; or
                         (ii) the  amount  specified  in  Section  402(g) of the
                    Code, as adjusted by the Secretary of the Treasury from time
                    to time (e.g.  $9,500 for  calendar  year 1997,  $10,000 for
                    calendar year 1998 and 1999, and $10,500 for 2000 and 2001);
                    or
                         (iii) the amount that can be contributed as a result of
                    a Hardship Distribution made in accordance with Section 5.09
                    hereof   (namely,   in  the  Plan   Year  of  the   Hardship
                    Distribution,  an amount not in excess of the  Participant's
                    Salary  Reductions  for that Plan Year  prior to the date of
                    the Hardship Distribution,  and in the Plan Year immediately
                    subsequent to the Plan Year of the Hardship distribution, an
                    amount not in excess of the applicable limit in effect under
                    Section  402(g) of the Code for such  taxable  year less the
                    amount of such Participant's Salary Reduction  Contributions
                    for the Plan Year of the Hardship Distribution).
<PAGE>

          With respect to periods during which Salary Reduction elections are in
          force for Participants, the Participating Employer shall contribute to
          the Plan an amount  equal to the Salary  Reduction  for each  electing
          Participant.   Salary   Reduction   elections   shall  be  subject  to
          nondiscriminatory   rules  and   procedures   approved   by  the  Plan
          Administrator  in its discretion from time to time.  Salary  Reduction
          elections are effective as soon as administratively feasible following
          receipt  of the  election  request  by the Plan  Administrator  or its
          designee,  and may be prospectively  revoked or suspended effective as
          soon  of  the  first  day of  any  month  following  receipt  of  such
          revocation  or  modified  by the Plan  Administrator  or its  designee
          (prior to January 1, 1998,  suspensions could be effected at any time,
          and  modifications  of  Salary  Reduction   elections  could  be  made
          effective  as of the  first  day of  each  calendar  quarter).  Salary
          Reduction Contributions are subject to the limitations of Section 5.09
          hereof (with respect to Hardship Distributions) and to the limitations
          of Article  VII hereof and may be  limited,  adjusted  or  returned in
          accordance  with the  provisions  of  Article  VII.  Salary  Reduction
          Contributions  shall be allocated to  Participants'  Salary  Reduction
          Account Balances as provided in Section 4.03 hereof.

                    (2) Company Matching Contributions for Employees.
                        ---------------------------------------------
                         (A) For Non-Union Employees.  With respect to each Plan
                    Year, each  Participating  Employer shall make a uniform and
                    non-discriminatory   matching   contribution   in  cash  or,
                    commencing  July 1, 1993, in shares of Company Stock or cash
                    (as  determined by the Board of Directors or the  Retirement
                    Committee),  in an amount equal to $.50 for each  $1.00 of a
                    Participant's  Salary  Reduction  Contributions  up  to  six
                    percent   (6%)  of   such   Participant's   total   eligible
                    Compensation (for a total matching  contribution of up to 3%
                    of eligible  Compensation).  Notwithstanding  the  preceding
                    sentence, the Retirement Committee, on behalf of the Company
                    or  any  Participating  Employer,  may  elect  prior  to the
                    beginning  of any Plan Year to provide a  different  rate of
                    Company  Matching  Contributions,  or  no  Company  Matching
                    Contributions  for any particular  group of Participants for
                    such Plan Year.

                         (B) For Collectively Bargained Employees.  With respect
                    to each  Plan  Year,  each  Participating  Employer  that is
                    subject to the terms of a  collective  bargaining  agreement
                    shall make a Company Matching contribution on behalf of each
                    Participant covered by such collective  bargaining agreement
                    in such amount as shall, from time to time be specified as a
                    result of collective bargaining.  Such contribution shall be
                    in cash or,  commencing on and after July 1, 1993, in shares
                    of Company Stock, as provided by the terms of the applicable
                    collective bargaining agreement.

                         (C) Timing of Matching  Contributions.  With respect to
                    Non-Union Employees, Company Matching Contributions shall be
                    made on a monthly basis and,  effective as of April 1, 2001,
                    shall be made with each  payroll  period.  Unless  otherwise
                    specified  under  the  terms  of  an  applicable  collective
                    bargaining agreement,  Company Matching  Contributions shall
                    be made on a monthly  and,  effective  as of April 1,  2001,
                    shall be made with each  payroll  period.  Company  Matching
                    Contributions  shall be allocated to  Participants'  Company
                    Matching   Contribution  Account  Balances  as  provided  in
                    Section   4.03   hereof.   Unless  the  Board  of  Directors
                    determines otherwise,  Company Matching  Contributions shall
                    be subject to the vesting schedule contained in Section 5.10
                    hereof,  and shall not be  subject  to Code  Section  401(k)
                    restrictions.  Company Matching Contributions are subject to
                    the  limitations  of Article  VII hereof and may be limited,
                    adjusted, recharacterized or returned in accordance with the
                    provisions of Article VII.
<PAGE>

                    (3) Additional Discretionary Company Contributions.
                        ----------------------------------------------
               With respect to any Plan Year, a Participating Employer may elect
          to make an additional  discretionary  contribution on behalf of one or
          more collectively bargained,  or non-collectively  bargained groups of
          employees. Such contributions may be made without regard to whether or
          not  the  Participating  Employer  has  net  profits.

     The sum of the  contributions  made pursuant to subparagraphs  (1), (2) and
     (3) hereof  generally  shall not exceed the amount  deductible  for federal
     income  tax  purposes,   currently  fifteen  percent  (15%)  of  the  total
     Compensation  of  Participants  for the  fiscal  year of the  Company  with
     respect to which such contributions are made.

          (b) Payment of  Contributions.  Participating  Employers shall pay the
     contributions  under Section  3.02(a) above to the Trustee by no later than
     the due date  (including  extensions) of the Employer's  federal tax return
     for the fiscal  year of the  Employer  coinciding  with the Plan  Year,  or
     within  which the Plan  Year  ended.  Salary  Reduction  Contributions  for
     Participants shall be paid to the Trustee as soon as they can be reasonably
     segregated,  but in no event later than the fifteenth  (15th)  business day
     following the end of the month in which the reduced amounts would have been
     paid to Participants if no Salary Reduction election had been in force.
<PAGE>


     3.03 Reversion of  Contributions  to the Company.  No  contributions  shall
revert to the Company, except that:

          (a) in the case of a contribution  or portion thereof which is made by
     the  Participating  Employer by mistake of fact, the amount  contributed by
     mistake  may  be  returned  to  the   Participating   Employer  making  the
     contribution upon its request within one year after the payment thereof;

          (b) the Company's  contributions  under Section 3.02 hereof hereby are
     conditioned  on  qualification  of this Plan under Section 401 of the Code,
     and if the Plan does not initially  qualify,  such  contributions  shall be
     returned to the  Participating  Employer making the  contribution  upon its
     request  within one year after the date of denial of  qualification  of the
     Plan;

          (c)  Company's  contributions  under  Section  3.02 hereof  hereby are
     conditioned  on their  deductibility  under Section 404 of the Code and, to
     the extent not so deductible,  such contributions  shall be returned to the
     Participating  Employer making the contribution upon its request within one
     year after the disallowance of the deduction; and

          (d) in the  event  the  Plan  terminates  at a time  where  there  are
     unallocated  funds in a suspense  account provided for in the Plan in order
     to comply with the  limitations  under Section 415 of the Code, any and all
     such funds shall be returned to the Company upon its request.

Notwithstanding  the  foregoing,  no  refund  shall be made from the Fund of any
property  or funds  otherwise  subject  to  refund  hereunder  which  have  been
distributed  to   Participants   or   Beneficiaries.   In  the  case  that  such
distributions become refundable, the Company shall have a claim directly against
the  distributees  to the  extent  of the  refund  to which it is  entitled.  No
interest   shall  be  paid  to  the  Company  with  respect  to  any  refundable
contribution.  In  determining  the amount to be  refunded  pursuant  to Section
3.03(a) or (c), above, the refund shall be reduced by any net loss  attributable
to the  contribution to be refunded,  but shall not be increased by any net gain
so attributable.
<PAGE>

     3.04  Participant  Contributions.  No  Participant  contributions  shall be
required  under the Plan;  and no  voluntary  after-tax  contributions  shall be
permitted  under the Plan.  Notwithstanding  the  foregoing,  to the extent that
voluntary after-tax  contribution account balances have been transferred to this
Plan,  whether as a result of a plan merger (e.g., the merger of the LGS Savings
and Investment Plan, or the GASCO  Bargaining  401(k) Plan, into this Plan) or a
trust-to-trust   transfer  from  another  qualified  defined  contribution  plan
(including,  without  limitation,  those maintained by Alltel and GTE), the Plan
shall maintain a Voluntary After-Tax  Contribution  Account Balance on behalf of
those  Participants  credited with such balances as of the merger or transfer in
question,  but no such Participant may make any additional  voluntary  after-tax
contributions.

     3.05 Forfeitures. There shall be no forfeitures of any Participant's Salary
Reduction Account Balance, Rollover Account Balance, Transferred Account Balance
that was fully vested,  TRASOP Account Balance, LGS Account Balance or Voluntary
After-Tax  Contribution  Account Balance (if any) under the Plan. All amounts in
those  sub-Accounts  shall at all times be fully vested and  non-forfeitable.  A
Participant's  Company Matching  Contribution Account Balance and, if elected by
the Board of Directors, any additional Discretionary Company Contributions shall
be subject to the  Vesting  Schedule  in  Article V. The  unvested  portion of a
Participant's   Account  shall  be  forfeited   upon  the  earlier  of  (a)  the
distribution of the vested portion of the Participant's  Account or (b) the last
day of the Plan Year in which the Participant incurs five (5) consecutive Breaks
in Service. Forfeited amounts shall be applied to reduce future contributions of
the  Company  and other  Participating  Employers.  In the  event  that a former
Participant  is  re-employed  by the Company or another  Participating  Employer
prior to incurring a five-year Break in Service,  the amount which was forfeited
shall be restored to his credit  either out of  forfeitures  arising  during his
year of  reemployment  or from additional  Company  Contributions.  Amounts from
misclassification  or mistake of fact which are not otherwise  returnable to the
Company also shall be applied to reduce Company Matching Contributions.
<PAGE>

     3.06 Investment of Contributions

     (a) Generally.  All contributions under the Plan shall be added to the Fund
held  by the  Trustee  under  the  Trust  Agreement,  to be  managed,  invested,
reinvested and  distributed in accordance with the Plan, the Trust Agreement and
any  agreement  with  an  insurance  company  or  other  financial   institution
constituting  a part of the Plan and Fund.  The  management  and  control of the
assets of the Plan shall be vested in the  Trustee  designated  by the  Company,
provided that the Company may appoint one or more Investment Managers to manage,
acquire or dispose of any assets of the Plan.

     (b) Participant Directed Investments.  The Plan Administrator is authorized
and  directed  to  maintain  a  program,  to be  administered  in a uniform  and
non-discriminatory manner, whereby a Participant,  an Alternate Payee or, in the
event of a  Participant's  death, a Beneficiary may direct the investment of the
Participant's Account to the extent that such Account is attributable to amounts
other than those  required to be invested  in Company  Stock.  By virtue of such
Participant  directed  investments,  the Plan is intended to  constitute  a plan
described  in  Section  404(c)  of  ERISA  and  the  final  regulations   issued
thereunder.  As such,  the  fiduciaries of the Plan may be relieved of liability
for  any  losses  that  are  the  direct  and  necessary  result  of  investment
instructions given by the Participant (or Beneficiary). However, the Participant
or  Beneficiary  shall  not be deemed  to be a plan  fiduciary  by reason of the
exercise  of  control  over  the  investment  of his  Account.  In the  case  of
contributions  (other than Matching  Contributions  invested in Company Stock or
TRASOP or LGS Account  Balances) for which no Participant  investment  direction
has been  received,  the  Committee  has  authorized  the Trustee to invest such
amounts in a stable  income  fund in order to  preserve  principal.  Participant
investment  directions  shall be subject to such rules and regulations as to the
timing  and  frequency  of  investment  changes,  limitations,   allocations  of
expenses,   transaction   and   brokerage   fees,   and  other  aspect  of  Plan
administration as the Committee may from time to time establish in writing.  The
Company may change the types of  investments  offered from time to time, and may
add or delete any  particular  investment  option by  resolution of the Board of
Directors or the Committee if so authorized by the Board. All expenses  directly
or indirectly caused or incurred as a result of individual  investment direction
shall be paid from and constitute a charge  against the respective  account of a
Participant requesting such individual investment direction.
<PAGE>


     (c) Company Stock Fund.  The Trustee shall maintain a Company Stock Fund in
which all  Company  Matching  Contributions  made  since  July 1, 1993  shall be
invested  unless  otherwise  directed  from  time  to  time  by  the  Retirement
Committee.  All dividends,  distributions,  gain or income  attributable to such
Company  Stock  shall be  reinvested  in the Company  Stock Fund.  Stock for the
Company  Stock Fund shall be  purchased  by the  Trustee  regularly  on the open
market, unless otherwise directed by the Retirement Committee. If so directed by
the Retirement Committee, the Trustee shall acquire treasury stock, newly issued
shares of  Company  stock  previously  authorized  but  unissued,  or stock from
private purchase.

     Upon attaining age 55, a Participant may elect to transfer amounts from his
Company Matching  Contribution Account to any of the other investment categories
then available and/or direct that any future Company  Matching  Contributions be
made to any of the other investment categories then available.

     (d) Investment and Diversification of TRASOP Account. The TRASOP Account of
each Participant shall be invested in Company Stock. However, within ninety (90)
days after the close of the first calendar year in which a Participant  has both
reached age 55 and completed at least 10 years of  participation  in the TRASOP,
and  within  ninety  (90) days of the  close of each of the five (5)  succeeding
calendar years ("the Qualified Election  Period"),  the Participant may elect to
redirect the investment of 25% (50% in the case of the last calendar year in the
Qualified  Election Period) of that portion of his TRASOP Account  determined as
of the end of the prior calendar year,  which is  attributable  to Company Stock
allocated to his TRASOP Account after 1986,  reduced by the amount of the TRASOP
Account previously  diversified.  As of _________________,  this diversification
obligation was satisfied with respect to all TRASOP Stock allocated after 1986.
<PAGE>

     (e)  Investment  and  Diversification  of LGS  Account.  Participants  with
account  balances  derived from the LGS Employees'  Savings and Investment  Plan
which are invested in Company Stock may not specify different investment options
for the balances in their LGS Accounts until the Participant  attains age 55, on
and after which date the  Participant  may elect to transfer  amounts from their
LGS  Accounts to any of the other  permitted  Participant  directed  investments
under  the  Plan,  in  accordance  with  uniform  and  nondiscriminatory   rules
established by the Plan Administrator.

     (f) Investment in Life  Insurance.  Prior to January 1, 1992,  Participants
were permitted to elect to invest a portion of his Salary Reduction Contribution
in certain life  insurance  investments  made  available  under the Plan. On and
after  January 1, 1992,  any  Participant  who had not elected to invest in life
insurance  was  no  longer  permitted  to  choose  that   investment;   however,
Participants who already had made such an investment  election were permitted to
continue to service the policies in the Plan.

          (i)  Limitations on Insurance Investment.  Any Participant electing to
               invest in life  insurance  prior to  January 1, 1992 may elect to
               invest a portion of his Salary Reduction  Contribution Account in
               individual or group insurance  policies covering the Participant,
               his  spouse or his  children,  and in  individual  group  annuity
               contracts  issued  by  one  or  more  insurance  companies.  Such
               investment   shall  be  deemed  a  separate   investment  of  the
               Participant's Salary Reduction  Contribution Account and premiums
               on such polices  shall be charged to such  Account.  No more than
               49.99%  of  the  aggregate  amount  of  a  Participant's   Salary
               Reduction   Contributions  may  be  invested  in  universal  life
               insurance  contracts on the life of the Participant or his spouse
               or  children.  No more than 24.99% of the  aggregate  amount of a
               Participant's  Salary Reduction  Contributions may be invested in
               term life insurance contracts on the life of the Participant, his
               spouse or children.  If both  universal  and term life  insurance
               contracts  are  purchased,  the  sum  of  the  annual  term  life
               insurance premium,  plus one-half of the universal life insurance
               premium  may  not  exceed  24.99%  of  the  Participant's  Salary
               Reduction Contributions for the Plan Year in question.
<PAGE>

          (ii) Treatment of Policy Dividends.  Any dividends that become payable
               on any contracts shall be used to provide additional benefits for
               the Participant.

          (iii)Borrowing.  A  Participant  may not borrow  amounts from insurers
               issuing  such  policies or use such  policies  as security  for a
               loan;  however,  the  trustee,  with  the  consent  of  the  Plan
               Administrator may borrow against the policies to fund loans under
               Section 5.12 hereof.

          (iv) Distribution.   Upon  distribution  of  a  Participant's   Salary
               Reduction Contribution Account Balance, the Participant may elect
               (a) to direct the Trustee to convert  into cash the entire  value
               of any individual policies or contracts purchased,  and to credit
               such amount to the  Participant's  Salary Reduction  Contribution
               Account or,  alternatively,  (b) to receive a distribution of the
               policies or contracts intact.

          (v)  Beneficiary  of Policy on  Participant.  The Trustee shall be the
               named  beneficiary of any insurance  policy on the  Participant's
               life  held  under  the  Plan.  In the  event of the  death of the
               Participant  prior  to the  distribution  or  cashing  out of the
               policy,  the  proceeds  from  such  policy  shall be added to the
               Participant's  vested  Account  Balance  and  distributed  to the
               Participant's   Beneficiary  as  determined  in  accordance  with
               Section 6.04.
<PAGE>

          (vi) Beneficiary  of Policy on Spouse or Child.  To the extent  that a
               Participant's  Salary Reduction  Contribution Account is invested
               in a life insurance  policy on the life of the Member's Spouse or
               children,  the  beneficiary  under  such a  Policy  shall  be the
               Participant.

     3.07  Expenses  of Plan  Amendment  and  Administration.  The  expenses  of
amending,  restating  and  administering  the Plan and Fund shall be paid by the
Fund, to the extent not paid directly or reimbursed by the Company.  The Company
may advance  funds to the Plan for the payment of Plan  ordinary  operating  and
administrative  expenses,  and shall be entitled to be reimbursed  therefor from
the Plan without interest.  Administrative expenses include fees and expenses of
the  Fiduciaries of the Plan for the performance of their duties under the Plan,
reasonable fees and expenses of any legal counsel, accountant,  actuary or agent
for  authorized  services  rendered in respect of the Plan and all other  proper
charges  and  disbursements  in respect of the Plan  (including  settlements  of
claims or legal actions  approved by legal counsel to the Plan).  The members of
the Retirement  Committee,  Review  Committee and any other Committee  permitted
under this Plan may receive  reasonable  compensation  for their  services,  and
shall be reimbursed by the Company for all  necessary  expenses  incurred in the
discharge of their duties;  expressly provided,  however,  that no member of any
such Committee who is receiving  compensation  as an employee of the Company may
receive  compensation  for  his or  her  services  as a  member  of a  fiduciary
Committee. All expenses directly or indirectly caused or incurred as a result of
individual  investment  direction  shall be paid  from and  constitute  a charge
against the  respective  account of a  Participant  requesting  such  individual
investment direction.

     3.08 Fund is Sole Source of Benefits.  The Fund shall be the sole source of
benefits under the Plan. No  Participating  Employer nor any other  Fiduciary of
the  Plan  guarantees  the  Fund  in  any  manner  against  investment  loss  or
depreciation  in asset  value or assumes any  liability  or  responsibility  for
payment out of its or his own assets of any  benefits  promised  under the Plan.
Each  Participant,  Beneficiary or other person who shall claim the right to any
payment under or in respect of the Plan shall bear all risk in  connection  with
any decrease in the value of the assets of the Fund or in their Account Balance.
Any  Participant,  Beneficiary or other person  claiming any benefit under or in
respect of the Plan shall be entitled to look only to the Fund for such  payment
and,  unless  otherwise  required by applicable  law,  shall not have any right,
claim or  demand  therefor  against  any  Participating  Employer  or any  other
Fiduciary of the Plan.
<PAGE>

     3.09  Rollover  Contributions.  The  Plan  may  receive,  on  behalf  of  a
Participant,  Rollover  Contributions  representing  all or part  of the  entire
amount  of any  distribution  from  a  qualified  retirement  plan  meeting  the
requirements of Internal Revenue Code Section 401(a); provided that:

          (a)  no  part  of  any   distribution   that   consists  of  after-tax
     contributions or, on or after January 1, 1999, a Hardship Distribution, may
     be rolled over to this Plan;

          (b) no distribution  that is made to comply with the minimum  required
     distribution  rules of Code Section  401(a)(9)  may be rolled to this Plan;
     and

          (c) no  distribution  that is one of a series of  substantially  equal
     periodic   payments  made  over  the  life  (or  life  expectancy)  of  the
     Participant  or  the  joint  lives  (or  joint  life  expectancies)  of the
     Participant and his designated  Beneficiary,  or for a specified  period of
     ten years or more may be rolled over to this Plan.

Any such  rollover  may be made (i) through a direct  rollover  from a qualified
plan to this Plan, or (ii) through a distribution and rollover deposited in this
Plan no later than the sixtieth (60th) day after the  distribution  was received
by the  Participant  from  the  distributing  qualified  plan or from a  conduit
individual retirement account.

     With  respect  to a  determination  that the  distributing  plan  meets the
requirements of Code 401(a), evidence that the distributing plan has received
a favorable  determination letter from the Internal Revenue Service shall not be
necessary for the Plan  Administrator  to reach the  conclusion,  in good faith,
that such Rollover Contributions appear to be valid.
<PAGE>

     Rollover  Contributions  may only include amounts  attributable to employer
contributions  and earnings  thereon,  earnings on employee  contributions,  and
employee  contributions  which were eligible for a tax deduction  under Internal
Revenue Code Section 219 and earnings  thereon.  Rollover  Contributions  may be
invested  in any manner  authorized  under the  provisions  of this  Plan.  That
portion  of  a   Participant's   Account   Balance   attributable   to  Rollover
Contributions  shall be distributed at the same time and manner as the remainder
of his Account Balance and shall not be available for in-service withdrawals.

     3.10 Plan to Plan Transfers.  The Plan may directly  receive all or part of
the entire  amount  credited to a Participant  from a pension or profit  sharing
plan meeting the requirements of Internal Revenue Code Section 401(a),  pursuant
to the terms of an elective  transfer as provided in Section  1.411(d)-3  of the
Treasury  Regulations,  as those  regulations  may be amended from time to time.
Likewise,  the Company may receive direct transfers representing a Participant's
interest  in a  qualified  retirement  plan.  In its sole  discretion,  the Plan
Administrator  may refuse to permit  transfers from any plan subject to Sections
401(a)(11)  or  417  of the  Code.  Transfers  may  be  invested  in any  manner
authorized  under the  provisions of this Plan or may be segregated and invested
separately according to the provisions of the transferor plan.

     3.11 Suspension of Salary Reduction  Agreements.  The following  provisions
shall apply with respect to suspension of Salary Reduction Agreements.

          (a) Elective  Suspension.  An Active  Participant may elect to suspend
     his  Salary  Reduction  Agreement  effective  as soon  as  administratively
     feasible   following   receipt  by  the  Administrator  of  the  notice  of
     suspension.

          (b)  Suspension for Military  Leave. A Participant  who is absent from
     employment on account of an authorized  leave of absence or military  leave
     shall have his Salary Reduction Agreement suspended during such leave. Such
     suspension  of  Contributions  shall be  effective  on the date  payment of
     Compensation by the Company to him ceases, and shall remain in effect until
     payment of  Compensation  is resumed.  At the  expiration of the suspension
     period described in (a) and (b) above, the  Participant's  Salary Reduction
     Agreement shall  automatically  become  effective again and such applicable
     contributions  shall be  resumed on behalf of the  Participant,  subject to
     applicable requirements for making up elective deferrals in accordance with
     the  requirements  of  Section  414(u) of the Code and  regulations  issued
     thereunder.
<PAGE>

                                   ARTICLE IV
                        ALLOCATIONS AND ACCOUNT BALANCES
                        --------------------------------

     4.01 Books and Records to Show Account Balances. The Plan Administrator (or
its designee)  shall maintain,  or cause to be maintained,  books and records in
such a manner as to allow  determination  of a  Participant's  Company  Matching
Contribution   Account  Balance,   Salary  Reduction  Account  Balance  and,  if
applicable his Rollover  Account  Balance,  TRASOP Account  Balance,  Additional
Discretionary Company Contribution Account Balance and LGS Account Balance.


     4.02 Separate Accounts Maintained. In connection with the administration of
the Plan, separate accounts shall be maintained to record the following:

          (a)  the  Company  Matching   Contribution  Account  Balance  of  each
          Participant;

          (b) the Salary Reduction Account Balance of each Participant;

          (c) if  applicable,  his  Rollover  Account  Balance,  TRASOP  Account
          Balance and LGS  Account  Balance,  Transferred  Account  Balance,  or
          Voluntary After-Tax Contribution Account Balance;

          (d) if applicable,  his Additional  Discretionary Company Contribution
          Account Balance; and

          (e) such other or  different  account  balances or amounts as the Plan
          Administrator may determine to be appropriate from time to time.

Except  as may  be  required  in  Section  3.09  or  Section  3.10,  above,  the
establishment  and use of such accounts  shall not require a segregation of fund
assets,  all of which may be  administered  as a single  trust,  nor vest in any
Participant any right, title or interest in any specific assets of the fund.
<PAGE>

     4.03 Allocation of Contributions.  Subject to such different  allocation as
may be required by the  Top-Heavy  provisions  of Article VIII hereof and to the
limitations  of Article VII hereof,  Company  contributions  under  Section 3.02
hereof and forfeitures  reallocated in the same manner as Company  contributions
in  accordance  with  Section 3.05 hereof shall be allocated as provided in this
Section.  Allocations  (or  the  rate  of  allocations)  of  contributions  (and
forfeitures)  shall not be discontinued or decreased  because of a Participant's
attainment of any age.

               (a)  Allocation  of  Salary   Reduction   Contributions.   Salary
          Reduction  Contributions with respect to a Plan Year attributable to a
          Participant's  Salary  Reduction  election  shall be  allocated to the
          Participant's  Salary Reduction  Contribution Account Balance no later
          than the 15th business day following the end of the month in which the
          contribution with respect to his Salary Reduction is made.

               (b)  Allocation  of  Company  Matching   Contributions.   Company
          Matching Contributions,  if any, made by the Company with respect to a
          Plan Year,  shall be  allocated to the Company  Matching  Contribution
          Account  Balances of those  Participants  who receive Salary Reduction
          contributions.  In making the  allocation,  however,  a  Participant's
          Salary  Reduction  contributions in excess of six percent (6%) of such
          Participant's  eligible  Compensation (or such other percentage as may
          be  specified  pursuant  to  the  terms  of  a  collective  bargaining
          agreement) shall not be taken into account.

               (c) Allocation of Additional Discretionary Company Contributions.
          Any Additional Company Contributions,  made in accordance with Section
          3.02(a)(3)  shall be  allocated  to eligible  Participants,  either in
          proportion to compensation, or as otherwise provided by the Company in
          accordance with applicable Internal Revenue Code limitations.

<PAGE>

     4.04  Valuation  and  Allocation of the Fund.  With respect to  Participant
directed  investment  accounts,   the  Plan  Administrator  shall  revalue  each
sub-account  separately,   such  sub-accounts  consisting  of  Salary  Reduction
Contributions,  Company Matching  Contributions,  Company  Discretionary  Profit
Sharing Contributions and any other sub-accounts established. All income earned,
expenses incurred and profits and losses realized and unrealized with respect to
each Participant  directed investment during the period since the last valuation
shall be determined in accordance with acceptable  accounting methods reasonably
and consistently applied and shall be added to, or deducted from, the Account of
each Participant, based on the amount in each Participant directed investment as
of the  preceding  valuation  date.  So long as  mutual  funds are  offered  for
investment of  Participants'  Account  Balances,  such Account Balances shall be
credited  daily with the income  paid by the  particular  investment  vehicle in
which such Account, or portion thereof, is invested. The unrealized appreciation
or  depreciation  of the particular  investment  shall be reflected in the daily
closing balance of each such Account.  The Plan Administrator shall provide each
Participant with a statement as soon as administratively  feasible following the
end of each calendar  quarter  showing the value of each  Participant's  Account
Balance (including sub-accounts) as of the close of the last business day of the
calendar quarter just ended.  Life insurance  policies held under the Plan shall
be treated as segregated  assets the value of such shall be added to the Account
Balances  of the  Participants  whose  benefits  are to be paid in whole or part
through such contracts or policies.

     4.05 Account Balance Subject to Change Until  Distributed.  A Participant's
Account  Balance  shall  remain  subject  to  revaluation  and  other  change in
accordance with the provisions of the Plan until actually  distributed  from the
Fund to the Participant or his Beneficiaries.

                                    ARTICLE V
                              BENEFITS AND VESTING
                              --------------------

     5.01  Benefits  Are  Based  on  Account  Balances.  The  Plan is a  defined
contribution  profit  sharing 401(k) plan under which a  Participant's  benefits
consist solely of  distributions  of such  Participant's  Account  Balances.  No
particular  level of  benefits  is  guaranteed  or assured  under the Plan.  Any
benefits  provided  under this Plan which are protected  benefits  under Section
411(d)(6)  of  the  Code  and  regulations  thereunder  shall  be  available  to
Participants  (and their  Beneficiaries)  without regard to Employer  consent or
discretion.
<PAGE>

     5.02 Vesting In Salary Reduction Account Balances;  Vesting In TRASOP; LGS;
Voluntary  After-Tax and Rollover Account  Balances.  A Participant shall at all
times be fully vested in such  Participant's  Salary  Reduction  Account Balance
under the Plan.  Salary Reduction Account Balances shall be distributed upon the
terms and conditions and in the manner provided for in this Plan, except that no
distribution of any portion of such Account  Balances shall be made in violation
of the restrictions of Section 6.01 hereof. A Participant  shall at all times be
fully vested in TRASOP,  LGS, Voluntary After-Tax and Rollover Account Balances,
if any, under the Plan,  and such balances  shall be distributed  upon the terms
and conditions and in the manner provided for in this Plan.

     5.03 Normal Retirement  Benefits.  Upon retirement on or after reaching his
Normal  Retirement Date, a Participant's  Account Balances shall be fully vested
and  shall  be  distributed  as  provided  in  Section  6.03.  Unless  otherwise
determined under Section 6.02 hereof,  normal retirement  payments will commence
on or as soon after the Participant's Normal Retirement Date as administratively
feasible.

     5.04  Benefits  Before  Termination  of  Employment.  Except  as  otherwise
provided in this  Section or in other  Sections  of this  Article V, no benefits
under the Plan shall be distributed to a Participant who remains employed by the
Company.  Distributions  under this  Section  shall be  subject  to uniform  and
nondiscriminatory rules and procedures (which, among other things, may limit the
number of withdrawals per year, set maximum or minimum withdrawal  amounts,  and
specify required  information to be provided) approved by the Plan Administrator
in its discretion from time to time.
<PAGE>

          (a) Age 59 1/2 Distribution. If the Participant is Age 59-1/2 or older
     his entire Account Balance may be distributed.

          (b)  Hardship  Distributions.  If  the  distribution  qualifies  as  a
     Hardship Distribution (as defined in the Glossary), then contributions made
     as a result of a Salary  Reduction  Agreement by the  Participant,  but not
     earnings  credited  thereon  after  December 31, 1988,  may be  distributed
     (provided  that,  prior to  January  1,  1998 the  Participant  shall  have
     completed at least one (1) year of Plan participation.  Withdrawals made in
     accordance with this section may not be repaid. Before obtaining a Hardship
     Distribution,  a Participant,  if eligible,  shall be required to request a
     loan pursuant to Section 5.12.

          If a Participant  receives a Hardship  Distribution,  Salary Reduction
     Contributions shall be suspended for the twelve (12) month period following
     the date of the Hardship  Distribution.  When salary contributions  resume,
     the  Salary  Reduction  Agreement  may not  provide  for  Salary  Reduction
     Contributions for the taxable year in which the Salary Reductions  commence
     in excess of the applicable  dollar limit  specified in Code Section 402(g)
     reduced by the amount of such Participant's  Salary Reduction  Contribution
     for the taxable year in which the Hardship Distribution is made.

          (c) Voluntary After-Tax Contribution Account Balance Distributions. If
     the Participant has a Voluntary After-Tax  Contribution Account Balance, he
     may request a distribution of some portion or all of thereof (not to exceed
     the aggregate amount of his voluntary  contributions made prior to the date
     of  withdrawal  plus  earnings  thereon  reduced by the amount of any prior
     withdrawals  or  distributions  from  his  Voluntary  Contribution  Account
     Balance.)  Notwithstanding  the foregoing,  that portion of a Participant's
     TRASOP Account  attributable to after-tax  Participant  contributions shall
     not be available for withdrawal  prior to the Participant  reaching 59 1/2,
     terminating   service,  or  satisfying  the  provisions  of  (d)  below.  A
     Participant may withdraw all or any part of the fair market value of his or
     her traceable  pre-1987  Voluntary  Contributions  without  withdrawing the
     earnings  attributable  thereto.  Post-1986 Voluntary  Contributions may be
     withdrawn only with a portion of the earnings thereon,  determined by using
     the  following  formula:  DA [1 - (V  divided  by V + E)],  where DA is the
     distribution amount, V is the amount of Voluntary Contributions,  and V + E
     is the amount of Voluntary  Contributions  plus the  earnings  attributable
     thereto.
<PAGE>

          (d) TRASOP In-Service  Distributions.  Any Participant who is actively
     employed and who has a TRASOP Account Balance may request a withdrawal from
     such TRASOP  Account,  as of the last day of any Plan Year in Company Stock
     or  cash  with a  value  not  exceeding  the  amount  of the  Participant's
     contributions  to such TRASOP Account.  Such withdrawal shall be limited as
     follows:

          (i) no withdrawal may be made before the 84th month following the last
          day of the  month in which  such  contribution  was  allocated  to his
          TRASOP Account; and

          (ii) all withdrawals must be approved by the Plan Administrator.

If a withdrawal  is made  pursuant to this Section  5.04(d),  the  Participant's
TRASOP Account shall be debited by the amount of the withdrawal.

          (e)  Distributions  to  Alternate  Payee.  Notwithstanding  any  other
     distribution  restrictions in the Plan, a distribution may be made prior to
     the Participant's  termination of service to an Alternate Payee pursuant to
     the terms of a valid  qualified  domestic  relations  order approved by the
     Plan Administrator and entered by a court of competent jurisdiction.

          All withdrawals will be determined based upon the Current Market Value
     of assets in the Participant's Account as of the Valuation Date immediately
     preceding the date on which the  withdrawal  request is  processed.  Unless
     otherwise determined under Section 6.02 hereof, payments under this Section
     will commence on or as soon after the  distribution  date  requested by the
     Participant as administratively feasible.  Distributions shall be made from
     and charged to the Account Balance of the Participant.
<PAGE>

     5.05 Deferred Retirement Benefits.  Any Participant employed by the Company
beyond such  Participant's  Normal Retirement Date shall be fully vested in such
Participant's  Account  Balances,  which  shall be  distributed  as  provided in
Article VI hereof  upon  actual  retirement  or at such  earlier  date as may be
required for payments to begin by the  Participant's  Required  Beginning  Date.
Upon  the  request  of a  Participant,  payments  may  begin  on  or  after  the
Participant's  Normal  Retirement  Date while the  Participant  continues  as an
Employee.  A  Participant  continuing  as an Employee  after such  Participant's
Normal  Retirement Date shall be able to continue to make Salary  Reductions and
shall  continue to be  entitled  to receive  Contributions  in  accordance  with
Section 3.02 while such Participant is still an Employee and Participant.

     5.06 Disability  Benefits.  Upon becoming  Permanently Disabled (whether or
not a Participant has terminated  service or retired),  a Participant's  Account
Balances  shall be fully vested and shall be  distributed as provided in Article
VI hereof.  Unless otherwise  determined  under Section 6.02 hereof,  disability
retirement payments will commence as soon as administratively feasible after the
Participant (or his legal  representative) has been determined to be Permanently
Disabled.

     5.07 Death Benefits.

     (a) Death  While  Employed by  Company.  Upon death  while  employed by the
Company or a Related  Employer,  a Participant's  Account Balance shall be fully
vested  and  shall  be  distributed  in full to the  Beneficiary  designated  as
provided in Article VI hereof,  upon the request of the  Beneficiary  based upon
the  value  of such  Account  Balance  on the  date  that  the  distribution  is
processed.   Unless  otherwise   determined  under  Section  6.02  hereof,   the
Participant's Account Balance will be paid as soon after the Participant's death
as administratively feasible.

     (b) Death After Employment Has Ended.  Upon death after employment with the
Company or Related Employers has ended, that portion,  if any of a Participant's
undistributed,  vested Account  Balance shall be distributed to the  Beneficiary
designated as provided in Article VI hereof.  Unless otherwise  determined under
Section 6.02 hereof,  any  undistributed  vested Account Balance credited to the
Participant   will  be  paid  as  soon   after   the   Participant's   death  as
administratively feasible.
<PAGE>

     5.08 Benefits Following Termination of Employment.

     (a) Vesting.  Each  Participant  continuing  employment with the Company or
Related  Employers to his Normal  Retirement Age or beyond shall be fully vested
in his Company  Matching  Contribution  Account  Balance  and any  Discretionary
Company  Contribution Account Balance. If a Participant ceases to be employed by
the Company or Related Employers prior to reaching his Normal Retirement Age for
reasons  other than death or Permanent  Disability,  the  Participant's  Company
Matching  Contribution  Account  Balance and, if applicable,  his  Discretionary
Company  Contribution  Account  Balance  shall be  vested as of the date of such
Participant's termination of employment according to the following schedule:

            Years of Vesting Service              Vested Percentage
            ------------------------              -----------------

                 Less than 2                               0%
                      2                                    40%
                      3                                    60%
                      4                                    80%
                  5 or more                               100%

The vested portion of the Participant's  Account,  as determined above, shall be
distributed,  together with the Participant's  Salary Reduction Account Balance,
and if applicable,  his TRASOP Account Balance,  LGS Account  Balance,  Rollover
Account  Balance and any  Transferred  Account  Balance,  in accordance with the
provisions of (b) below.
<PAGE>

     The unvested portion of a Participant's Account shall be forfeited upon the
earlier  of (a) the  distribution  of the vested  portion  of the  Participant's
Account  or (b) the last day of the Plan  Year in which the  Participant  incurs
five (5)  consecutive  Breaks  in  Service.  If a  Participant  has  received  a
distribution  of the vested portion of the Account  Balances (i.e. a "Cash Out")
following a Break in Service as a result of ceasing to be an  Employee,  and was
less than 100% vested in his Account  Balance at such time, then the Participant
shall  have  the  right  to  repay  to the  Plan  the  amount  of the  Cash  Out
distribution.  Such  repayment must be made prior to the earlier of (i) five (5)
years  from the  individual  rehire  date,  or (ii) the  completion  of five (5)
consecutive  One  Year  Periods  of  Severance  following  the  date of Cash Out
distribution. If the Participant makes such repayment within the time specified,
then any  non-vested  portion of the Account  Balance that was forfeited will be
restored  either out of  forfeitures  in such Plan Year or, if  forfeitures  are
insufficient, by additional Company Contributions.

     (b) Payment.  Subject to the provisions of Section 6.02 hereof,  payment of
deferred vested benefits will commence as follows:

          (1)  if  upon   termination  of  service  the  present  value  of  the
     Participant's  vested  Account  Balance  derived  from Company and Employee
     contributions  does not exceed Five Thousand Dollars ($5,000) ($3,500 prior
     to January 1, 1998) at the time of  distribution  or at any Valuation  Date
     prior thereto the Account  Balance shall be paid in a single sum as soon as
     administratively   feasible  following  the  Participant's  termination  of
     service,  based upon the valuation as of the date on which the distribution
     is processed.  The nonvested  portion will be treated as a forfeiture.  For
     purposes  of this  section  and this Plan if the  value of a  Participant's
     vested  Account  Balance is zero, the  Participant  shall be deemed to have
     received  a  distribution  of such  Account  Balance.  Notwithstanding  the
     foregoing and in accordance with final and temporary  Treasury  Regulations
     relating  to the  increase  in cash-out  limit  under  Sections  411(a)(7),
     411(a)(11)  and  417(e)(1)  of the  Code,  if the  Account  Balance  of any
     Participant, who terminated employment on or before January 1, 1998 and who
     is otherwise  eligible for a distribution  under the Plan,  does not exceed
     Five Thousand Dollars  ($5,000),  the Plan  Administrator  may, at any time
     after January 1, 1998, distribute such Account Balance in a single lump sum
     payment, even if such Account Balance could only have been distributed with
     the  consent  of  the  Participant  at  the  Participant's  termination  of
     employment,  because, at the time of termination, the Participant's Account
     Balance was greater than Three Thousand Five Hundred  Dollars  ($3,500) but
     less than Five Thousand Dollars ($5,000).
<PAGE>

          (2) if the present value of the  Participant's  vested Account Balance
     exceeds Five Thousand  Dollars  ($5,000) ($3,500 prior to January 1, 1998),
     the Account  Balance shall be paid in accordance  with Article VI hereof as
     soon as  administratively  feasible  after the  Participant's  request  for
     distribution, but no later than his Required Beginning Date, based upon the
     valuation as of the date on which the distribution is processed;  provided,
     however,  that prior to January 1, 1998, such  distribution  was subject to
     spousal consent. Any unvested portion of the Participant's  Account Balance
     shall be forfeited as of the date of the distribution of his vested Account
     Balance.

          All  distributions  will be determined  based upon the Current  Market
     Value of assets in the  Participant's  Account as of the Valuation  Date on
     which the distribution is processed.

     5.09  Changes  in  Vesting  Provisions.  The  vested  Account  Balance of a
Participant shall be nonforfeitable and shall not be reduced by any amendment to
the Plan unless such  amendment  is required or  permitted  by the Code or other
law.  In the event that the  vesting  provisions  of the Plan are amended or the
Plan is amended in any way that directly or indirectly  affects the  computation
of the participant's Account Balance vested percentage, or if the plan is deemed
amended by the application of the Top-Heavy provisions of Article VIII hereof, a
Participant  with  at  least  three  (3)  Years  of  Vesting  Service  as of the
expiration  date of the election  period  described below may elect to have such
Participant's  vested Account Balance  computed under the Plan without regard to
such amendment.
<PAGE>

     5.10 Loans to Participants  and  Beneficiaries.  The Plan  Administrator is
authorized  in its sole  discretion  to establish and maintain a loan program in
accordance with Section 408(b)(1) of ERISA and consistent with the provisions of
this Section 5.10.  Only a Participant  who is a Party in Interest as defined in
Section  (3)(14) of ERISA as defined in the Glossary  (hereinafter  collectively
referred to as "Eligible  Borrowers")  shall be eligible to  participate  in the
loan program.

          (a) General Rules. Any Eligible  Borrower with a vested interest in an
     Account  Balance  under the Plan (who,  only with respect to loans prior to
     January 1, 1998,  had  completed two (2) years of Plan  participation)  may
     apply for a loan (with  spousal  consent only for loans in excess of $3,500
     made prior to January 1,  1998.) Loan  applicants  may be required to pay a
     reasonable loan processing fee and annual  administration  fee, which shall
     be deducted from their Account Balance. Loan applications shall be approved
     or  denied by the Plan  Administrator  within a  reasonable  period of time
     after receipt. Loans shall be made available to all Eligible Borrowers on a
     uniform and reasonably  equivalent basis, without regard to an individual's
     race,  color,  religion,  sex, age or national origin.  In reviewing a loan
     application,  the Plan Administrator shall consider only those factors that
     would be  considered  in a normal  commercial  setting  by an entity in the
     business of making  similar  types of loans.  Such  factors may include the
     Eligible Borrower's  creditworthiness and financial need. If approved,  the
     Plan Administrator  shall direct the Trustee to make a loan to the Eligible
     Borrower.  Any loan made to an  Eligible  Borrower  shall be  treated  as a
     segregated  investment  of a portion  of the  Eligible  Borrower's  Account
     Balance.  Loans shall be processed  and made in  accordance  with rules and
     procedures  from  time to time  adopted  by the Plan  Administrator  in its
     discretion.  Such rules and procedures  shall be in a written  document and
     are hereby incorporated herein by reference.
<PAGE>

          (b)  Amount.  Loans  shall  be made in  amounts  approved  by the Plan
     Administrator  in its  discretion.  Only one loan shall be outstanding at a
     time. No loan shall be less than One Thousand Dollars ($1,000).  No loan to
     the  Eligible  Borrower  shall  exceed the  lesser  of:

               (1) Fifty  Thousand  Dollars  ($50,000),  reduced by the  highest
          outstanding  balance of loans from the Plan to the  Eligible  Borrower
          during the one-year  period ending on the day before the date the loan
          is made, or

               (2) one-half  (1/2) of the  Eligible  Borrower's  vested  Account
          Balance  (but not more than his Salary  Deferral  Account  Balance for
          loans  prior to January 1, 1998)  minus the balance of all other loans
          from the Plan immediately preceding the date of the loan.


          (c) Rate of  Interest.  All loans  shall be  considered  a  segregated
     investment  of the Trust Fund and shall bear a reasonable  rate of interest
     to be determined by the Plan  Administrator  taking into  consideration the
     interest  rates being charged by regional and local banks,  the  prevailing
     prime rate and general  economic  conditions.  The interest  rate shall not
     exceed the maximum rate allowed by state or federal law, provided, however,
     that the Plan  Administrator  shall have no obligation to make loans during
     any period in which the maximum  rate allowed by state or federal law would
     not permit the loan to bear a  reasonable  rate of interest in light of the
     prevailing economic circumstances.

          (d) Term of Loan.  All loans  shall be for a maximum of five (5) years
     (56 months  for loans  made  prior to January 1, 1998) or for such  shorter
     term as the Plan Administrator may determine,  provided however that on and
     after  January  1,  1998,  loans made for the  acquisition  of a  principal
     residence  (or to acquire a dwelling  unit which within a  reasonable  time
     shall be used as the principal  residence of the Eligible  Borrower) may be
     for up to fifteen (15) years.

          (e) Security. All loans shall be secured by the pledge of the Eligible
     Borrower's  vested  Account  Balance  under  the Plan.  No more than  fifty
     percent (50%) of an Eligible  Borrower's Vested Account Balance  determined
     as of the valuation date coincident with or immediately  preceding the date
     of the loan may be used to secure a loan.
<PAGE>

          (f)  Repayment.  All  loans  shall  provide  for  substantially  level
     amortization  over the term of the loan,  with  payments of  principal  and
     interest made not less frequently than quarterly,  provided,  however, that
     the Eligible Borrower may prepay the loan at any time without penalty. Upon
     the Eligible  Borrower's  termination of employment,  any outstanding  Plan
     loan  must be  repaid  within  ninety  (90)  days to avoid  default . If an
     Eligible Borrower  withdraws a portion or all of such  individual's  vested
     Account Balance or becomes  entitled to payment of benefits under the Plan,
     such payments or withdrawals  shall first be applied toward any outstanding
     loan balance (including  accrued interest),  with the excess, if any, being
     paid directly to the individual. To the extent permitted by law, repayments
     will be suspended during an unpaid leave of absence or layoff for up to one
     year,  although  interest  will  continue to accrue during these periods of
     suspension.  Upon the Eligible Borrower's return to employment, the accrued
     interest  will  be  added  to  his  outstanding   loan  balance,   and  the
     individual's  repayment  amount will be adjusted so that the loan is repaid
     by the end of its original  term.  If a leave of absence or layoff  exceeds
     one year,  the  outstanding  loan balance will become  immediately  due and
     payable as of the end of the one-year period.  If the Eligible  Borrower is
     on leave of absence because of qualified  military  leave,  loan repayments
     will be  suspended  under this plan as  permitted  under  414(u)(4)  of the
     Internal Revenue Code.

If an Eligible Borrower  withdraws a portion or all of such individual's  vested
Account or becomes entitled to payment of benefits, such payments or withdrawals
shall first be applied  toward any  outstanding  loan  balance,  with the excess
being paid directly to the individual.

          (g)  Outstanding  Loan Balance at Termination of Employment.  Upon the
     termination of employment of an Eligible Borrower with an outstanding loan,
     the  outstanding  balance  (including  accrued  interest) of any loan shall
     become due and must be paid within ninety (90) days  following  termination
     to avoid  default.  If such  outstanding  loan balance is not repaid within
     that time limit,  such  amount  shall be  deducted  from the  Participant's
     remaining  Account Balance.  Thus, any distribution from the Plan following
     the  Participant's  termination  of  employment  shall  be  reduced  by any
     outstanding loan balance (including  accrued interest)  remaining unpaid at
     the end of the ninety (90) day  period.  The amount of the  defaulted  loan
     shall be taxable as a  distribution,  and shall be subject to the premature
     distribution penalty tax contained in Section 72(t) of the Code.
<PAGE>

          (h) Loan Defaults While  Employed.  If a Participant  fails to make an
     installment  payment  on an  outstanding  loan  when  due and  the  failure
     continues  for  sixty  (60)  days,  the  Administrator   will  provide  the
     Participant  written  notice  of his or her  right to cure the  failure  by
     making the missed  payment(s)  or repaying the loan in full. If the failure
     to make an  installment  payment is not cured within ninety (90) days after
     the payment  first became due,  the loan will be in default.  The amount of
     principal and interest on the loan remaining unpaid as of the date the loan
     defaults  will be  considered  to be a  "deemed  distribution"  and will be
     taxable to the  Participant.  However the loan will still be required to be
     repaid and interest  will continue to accrue  interest.  To the extent that
     the loan has not be repaid by the  Participant,  the Plan is  authorized to
     offset  the  entire  outstanding  amount  of the  loan  (including  accrued
     interest)  against  the  Participant's  Account  Balance  at the  time  the
     Participant becomes eligible for a distribution from the Plan.
<PAGE>


                                   ARTICLE VI
                              PAYMENT OF BENEFITS
                              -------------------

     6.01 General Rules for Payment.  Benefits  under the Plan shall commence as
provided  in Section  6.02  hereof and shall be paid in a form  permitted  under
Section 6.03 hereof.  Notwithstanding any provision of the Plan to the contrary,
all  distributions  from  this Plan  shall be made in  accordance  with  Section
401(a)(9) of the Code and regulations issued  thereunder,  including the minimum
distribution  incidental  benefit  requirement  of Treasury  Regulation  Section
1.401(a)(9)-2. Specifically, the timing and form of benefits permitted under the
Plan shall not violate any of the following requirements of the Code:

          (a) Not  later  than the  Participant's  Required  Beginning  Date the
     Participant's entire benefits under the Plan either--

               (1) shall be distributed to the Participant, or

               (2) shall commence to be distributed--

                    (A) over the life of the  Participant  or over the  lives of
               the Participant and a designated Beneficiary, or

                    (B) over a period not extending  beyond the Life  Expectancy
               of the  Participant or the Life Expectancy of the Participant and
               a designated Beneficiary.

The amount  required to be  distributed  for each calendar year  beginning  with
distributions for the first  Distribution  Calendar Year must at least equal the
quotient obtained by dividing the Participant's benefit by the lessor of (l) the
Applicable  Life  Expectancy  or (2)  if the  Participant's  spouse  is not  the
designated  beneficiary,  the applicable  divisor  determined from the table set
forth  in Q & A-4 of  Section  1.401(a)(9)-2  of  the  Income  Tax  Regulations.
Distributions  after the death of the Participant shall be distributed using the
Applicable Life Expectancy as the relevant divisor without regard to regulations
Section  1.401(a)(9)-2.  In the case of a  Participant  and  spouse,  such  Life
Expectancies shall not be re-determined.
<PAGE>

               (b) The minimum distribution required for the Participant's first
          Distribution Calendar Year must be made on or before the Participant's
          Required  Beginning Date. The minimum  distribution for other calendar
          years,  including  the minimum for the  Distribution  Calendar Year in
          which the Participant's  Required Beginning Date occurs,  must be made
          on or before December 31 of that Distribution Calendar Year.

               (c) If after distribution has begun in accordance with Subsection
          (a)(2), above, a Participant dies and death benefits are payable under
          the Plan such death  benefits shall be distributed at least as rapidly
          as the  Participant's  remaining  interest in the Plan would have been
          distributed  under the method of distribution in effect as of the date
          of the Participant's death.

               (d)  If  before   distribution   has  begun  in  accordance  with
          Subsection  (a)(2),  above, a Participant  dies and death benefits are
          payable under the Plan such death  benefits shall be distributed as of
          December  31 of the  calendar  year  which  contains  the fifth  (5th)
          anniversary of the death of the Participant unless an election is made
          to receive distributions in accordance with (1) or (2) below:

                    (1) if any portion of the Participant's  interest is payable
               to a designated  Beneficiary,  distributions may be made over the
               life  or  over  a  period  certain  not  greater  than  the  Life
               Expectancy of the designated  beneficiary commencing on or before
               December 31 of the calendar year in which the participant died;

                    (2)  if the  designated  Beneficiary  is  the  Participant's
               surviving spouse, the date distributions are required to begin in
               accordance  with (1) above shall not be earlier than the later of
               (i) December 31 of the calendar  year  immediately  following the
               calendar year in which the  Participant  died or (ii) December 31
               of the calendar year in which the Participant would have attained
               age seventy and one-half (70 1/2).
<PAGE>

     If the Participant  has not made an election  pursuant to this Section 6.01
by the time of his or her death, the Participant's  designated  Beneficiary must
elect the method of distribution no later than the earlier of (1) December 31 of
the calendar  year in which the  distributions  would be required to begin under
this section,  or (2) December 31 of the calendar year which  contains the fifth
(5th)  anniversary of the date of death of the  Participant.  If the Participant
has no designated Beneficiary, or if the designated Beneficiary does not elect a
method of distribution,  distribution of the Participant's  entire interest must
be  completed  by December 31 of the calendar  year  containing  the fifth (5th)
anniversary of the Participant's death.

     If the surviving spouse dies after the Participant,  but before payments to
such spouse begin,  the provisions of this section with the exception of Section
6.01(d)(2)  therein,  shall  be  applied  as if the  surviving  spouse  were the
Participant.

     (e) For purposes of satisfying the above requirements of this Section 6.01,
any amount paid to a child of the Participant shall be treated as if it had been
paid to the Participant's surviving spouse if such amount will become payable to
the  surviving  spouse upon such child  reaching  majority (or other  designated
event permitted under regulations under the Code).

     (f) For  purposes of this Section  6.01,  distribution  of a  Participant's
interest is considered to begin on the Participant's Required Beginning Date or,
if the last portion of Section 6.01(d) is applicable,  the date  distribution is
required to begin to the surviving spouse pursuant to Section 6.01(d) above.

     (g) A Participant's  Salary Reduction  Contribution Account Balance subject
to Code Section 401(k)  restrictions shall not be distributed to the Participant
or his Beneficiary earlier than upon--

          (1) the Participant's  retirement,  death,  disability,  or separation
     from service;
<PAGE>

          (2) the sale or the  disposition by the Company of  substantially  all
     its  assets  used in a trade or  business  to an  unrelated  entity  if the
     Company continues to maintain this plan, but only with respect to employees
     who continue employment by the acquirer;

          (3) the sale or other  disposition  by the  Company  of the  Company's
     interest in a subsidiary to an unrelated entity if the Company continues to
     maintain  this  Plan,  but only with  respect  to  employees  who  continue
     employment with such subsidiary;

          (4) termination of the Plan without  establishment or maintenance of a
     successor plan;

          (5) Hardship, or;

          (6) the attainment of age fifty-nine and one-half (59-1/2).

Such Account Balances shall not be  distributable  merely by reason of the lapse
of a fixed number of years or the Participant  having  completed a stated period
of participation  in the Plan. In the case of a distribution  made on account of
Hardship,  only the Salary Reduction  Contributions  made by the Participant and
earnings  thereon prior to January 1, 1989,  but not earnings  credited  thereon
after December 31, 1988, may be distributed to the Participant.

     (h) 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".  An "eligible rollover  distribution" is any
distribution  of all or any portion of the account  balance to the credit of the
distributee, except that an eligible rollover distribution does not include: 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  (10)  years  or  more;  any  distribution  to the  extent  such
distribution is required under Section 401(a)(9) of the Code; the portion of any
distribution that is not includable in gross income  (determined  without regard
to the  exclusion  for net  unrealized  appreciation  with  respect to  employer
securities);  and any  distribution  made  on or  after  January  1,  1999  that
qualifies  as a  Hardship  Distribution.  An  "eligible  retirement  plan" is an
individual  retirement  account  described  in  Section  408(a) of the Code,  an
individual  retirement  annuity  described  in  Section  408(b) of the Code,  an
annuity  plan  described  in section  403(a) of the Code,  or a qualified  trust
described in Section 401(a) of the Code, that accepts the distributee's eligible
rollover  distribution,  provided,  however,  that in the  case  of an  eligible
rollover distribution to a surviving spouse, an "eligible retirement plan" is an
individual  retirement  account  or  individual  retirement  annuity.  A "direct
rollover" is a payment by the Plan to the eligible  retirement plan specified by
the distributee. For purposes of this Section 6.01(h), a distributee includes 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 an alternate payee under a qualified domestic relations order, as defined
in section 414(p) of the Code, are  distributees  with regard to the interest of
such  spouse or former  spouse.  The  provisions  of  Section  6.01(h)  shall be
interpreted  in  accordance  with  the  proposed   regulations   under  Sections
401(a)(31),   402(c),  403(b)(8),   403(b)(10)  and  3405(c)  of  the  Code  and
regulations thereunder, all of which are incorporated herein by reference.
<PAGE>

     6.02  Commencement  of Benefits.  Payment of benefits  under the Plan shall
commence  only after the  Participant  has qualified for the payment of benefits
under the  provisions of Article V hereof and shall be distributed in accordance
with the provisions of Section 401(a)(14) of the Code. Unless and until the Plan
Administrator  establishes  a procedure  for  paperless  claims  administration,
distributions  of benefits shall not commence until a written claim for benefits
containing  all  information  reasonably  necessary for the payment of benefits,
together with such supporting  evidence as the Plan  Administrator  may require,
has been filed with the Plan Administrator.

     6.03 Form of Payment.  A Participant's  benefits under the Plan,  including
any death or disability benefits, shall be paid as elected by the Participant to
the Participant or, if deceased,  the  Participant's  surviving  spouse or other
Beneficiary  designated in accordance with Section 6.04 hereof, in a single lump
sum,  unless the  Participant  is covered by the  provisions of 6.03(a) below. A
Participant may elect to receive benefits  distributed from his Company Matching
Contribution  Account, his TRASOP Account and LGS Account, if any, in cash or in
whole shares of Company  Stock,  with the value of any  fractional  shares being
paid in cash. All distributions under the Plan are subject to federal, state and
local tax  withholding  as required by applicable  law as in effect from time to
time.

     (a) Additional Forms of Benefit Payments for GASCO Bargaining Participants.
Participants  who formerly  participated in the GASO Bargaining  401(k) Plan may
elect to have their vested Account Balance  distributed either in a lump sum, or
in monthly,  quarterly or annual  installments  payable for a period certain not
extending  beyond their life expectancy  determined at the time the distribution
commences.

     6.04 Designation of Beneficiaries.

          (a) A  Participant's  spouse  shall  be the  Participant's  designated
     beneficiary  under the Plan unless the  Participant  designates a different
     Beneficiary   and,  if  necessary  under  Section   6.04(b)   hereof,   the
     Participant's  spouse  consents  to  such  designation.  A  Participant  or
     Beneficiary,   by  means  of  a  signed   writing   filed   with  the  Plan
     Administrator,  and subject to the spousal consent rules of Section 6.04(b)
     hereof,  may at any time  designate a person or persons to be a Beneficiary
     or Beneficiaries  hereunder,  or revoke a prior  designation,  and the last
     unrevoked designation, if any, shall determine the designated Beneficiaries
     hereunder.  A designation shall automatically revoke all prior designations
     made  by the  same  person.  A  designated  Beneficiary  must  survive  the
     Participant (or prior Beneficiary) to be entitled to any benefits under the
     Plan.  If  there  is no  effective  designation  of a  Beneficiary  upon  a
     Participant's or Beneficiary's  death, or if a Beneficiary becomes entitled
     to  benefits  hereunder  and then dies  without  benefits  payments  having
     commenced to said  Beneficiary  and without there being any provision  made
     for a successor Beneficiary, then benefits for which there is no designated
     Beneficiary  shall be paid to the  Participant's  spouse,  if then  living,
     otherwise equally per stirpes to the Participant's then surviving issue, or
     if none, to the Participant's estate. If benefit payments have commenced to
     a Beneficiary who dies without there being any provision made for successor
     beneficiaries,  then benefits for which there is no designated  Beneficiary
     shall be paid to the estate of the last  Beneficiary who had been receiving
     the payments. Beneficiary designations by a Participant's Beneficiary shall
     only take  effect if there are no living  Beneficiaries  designated  by the
     Participant to receive the benefits in question.
<PAGE>

          (b) Any  designation by a Participant of a Beneficiary  other than the
     Participant's spouse shall not be effective unless--

               (1) the  spouse of the  Participant  consents  in writing to such
          designation and the spouse's  consent  acknowledges the effect of such
          designation  and is  witnessed  by a Plan  representative  or a notary
          public, or

               (2) it is established to the satisfaction of a Plan Administrator
          (or its designee) that the consent  required under (1), above, may not
          be obtained  because there is no spouse,  because the spouse cannot be
          located or because of such other  circumstances  as may be provided in
          regulations issued pursuant to the Code.

Any consent by a spouse or determination that such a consent may not be obtained
shall be effective only with respect to such spouse.

     6.05 Payments to Minors or  Incompetents.  Upon proof  satisfactory  to the
Plan  Administrator that any person entitled to receive a distribution under the
provisions  of the Plan has become  incapable  or  incompetent  to  receive  and
receipt therefor,  the Plan  Administrator in its sole discretion may direct the
Trustee to make payment of such distribution to the duly appointed and qualified
guardian or  conservator  of the estate of such person,  or if there shall be no
such duly  appointed and  qualified  guardian or  conservator,  to any person or
persons appearing to the Plan Administrator to have assumed and to be reasonably
responsible for the financial affairs of such person.
<PAGE>


     6.06 Suspension of Benefits Upon  Reemployment.  Notwithstanding  any other
provisions of this Article VI if a Participant  receiving or to receive benefits
under the Plan returns to active  service as an Employee of the Company prior to
such  Participant's  Normal Retirement Date,  payment of benefits under the Plan
shall be suspended until the Participant  subsequently terminates active service
or reaches such  Participant's  Normal Retirement Date,  whichever first occurs,
provided,  however, that (1) benefits to be paid in accordance with Section 5.08
hereof  shall not be  suspended,  and (2) if the  Participant  continues  active
service beyond the Normal Retirement Date, the provisions of Section 5.05 hereof
shall apply. The suspension of benefits under this Section 6.06 shall not affect
a Participant's entitlement to or the timing of normal retirement benefits under
the Plan.

     6.07 Discharge of Obligation;  Receipt and Release.  All distributions from
the Fund pursuant to the  provisions of the Plan shall be made by the Trustee in
accordance with the Plan  Administrator's  written directions.  All payments and
distributions made hereunder shall to that extent constitute  complete discharge
of all obligations of the Company,  the Plan Administrator and the Trustee,  any
of whom may  require  the  distributee,  as a  condition  precedent  to any such
payment or  distribution,  to execute a receipt and  release  therefor in a form
satisfactory to the Fiduciaries of the Plan.
<PAGE>

     6.08 Nonalienation of Benefits.

          (a) The Plan is  intended  by the  Company  to  provide  a  system  of
     deferred  compensation for the support of Participants,  Beneficiaries  and
     their  families  related to the loss of earning power upon the happening of
     certain events.  Except as expressly  provided in Section 3.03 hereof or in
     this Section 6.08 or as otherwise  permitted  under ERISA and the Code,  no
     benefit or interest  available under the Plan will be subject to assignment
     or alienation, either voluntarily or involuntarily.

          (b)  A  Participant's  benefits  under  the  Plan  shall  be  paid  in
     accordance  with the applicable  requirements  of any  "qualified  domestic
     relations  order" (as defined in ERISA and the Code)  which  applies to the
     Participant's benefits under the Plan.

          (c) A  Participant's  benefits may be reduced,  as provided under Code
     Section  401(a)(13)(C),  as a  result  of an order  or  requirement  to pay
     under--

               (i) a judgment of conviction for a crime against the Plan;

               (ii) a civil judgment in connection  with a violation (or alleged
          violation) of Part 4 of Subtitle B of Title I of ERISA; or

               (iii) pursuant to a settlement  agreement between the Participant
          and the Secretary of Labor or the Pension Benefit Guaranty Corporation
          in  connection  with a violation  (or alleged  violation) of Part 4 of
          such Subtitle by a fiduciary or any other person.

          (d) In the event a Participant's benefits are attached by order of any
     court other than in a "qualified  domestic  relations order" (as defined in
     ERISA and the  Code),  the Plan  Administrator  may  bring an action  for a
     declaratory judgment in a court of competent  jurisdiction to determine the
     proper  recipient  of the  benefits  to be paid  by the  Plan.  During  the
     pendency of said action,  any benefits that become payable may be paid into
     the court as they become  payable,  to be  distributed  by the court to the
     recipient it deems proper at the close of said action.
<PAGE>

     6.09 Benefit  Claims  Procedures.  Unless and until the Plan  Administrator
establishes a procedure for paperless claims administration, claims for benefits
must be in  writing,  signed by the  Participant,  Beneficiary  or the  personal
representative of either the Participant or Beneficiary, as the case may be, and
shall be presented to the Plan Administrator.  If a claim for benefits is denied
in whole  or in part by the  Plan  Administrator,  the  claimant  shall be given
written notice thereof within ten (10) days following such denial.  Such written
notice shall set forth:

          (a) the reasons for denial of the claim;

          (b) a  reference  to the  particular  provisions  of the Plan on which
     denial of the claim is based;

          (c) a statement as to any additional facts or information necessary to
     perfect the claim and an explanation as to why the same is required; and

          (d) a reference to the procedures  hereinafter set forth for review of
     the denial of the claim.

          A claim which is duly submitted shall be deemed to have been denied if
     it has  not  been  granted  in  full  with  ninety  (90)  days  after  such
     submission.  Every person whose claim for benefits under the Plan is denied
     in whole  or in part by the  Plan  Administrator  shall  have the  right to
     request a review of such denial.  Such review shall be granted upon written
     request therefor filed by the claimant with the Plan  Administrator  within
     sixty (60) days  following  receipt of written  notice of the denial.  Such
     review  shall be conducted  by a Review  Committee  of three  persons to be
     designated by the Board of Directors of the Company.  At any hearing by the
     Review  Committee,  the  claimant,  in  person  or  by  a  duly  authorized
     representative,  shall  have  reasonable  notice and an  opportunity  to be
     present and be heard,  may submit and review pertinent  documents,  and may
     submit a written  statement.  The Review  Committee shall decide the matter
     with  reasonable  promptness and in any event within one hundred and twenty
     (120) days following receipt of a request for review. Its decision shall be
     in writing,  shall set forth its reasons for decision and the provisions of
     the Plan on which it is based,  and shall be  communicated to the claimant.
     <PAGE>

     6.10 Qualified Domestic Relations Order Procedures.

          (a)  Following the receipt of a domestic  relations  order which would
     affect the payment of a  Participant's  benefits  under the Plan,  the Plan
     Administrator shall promptly notify the Participant and any alternate payee
     specified  in the  order  (at the  address  included  in the  order) of the
     receipt  of the  order  and  the  Plan's  procedures  for  determining  the
     qualified status of such order.

          (b) Any alternate payee specified in the order by written direction to
     the Plan Administrator may designate a representative for receipt of copies
     of notices sent to the alternate payee with respect to the order.

          (c) Within a  reasonable  period  after  receipt of the order the Plan
     Administrator  shall  determine  whether such order is qualified and notify
     the  Participant  and any alternate  payee involved of such  determination.
     Such determination shall be made in accordance with provisions of ERISA and
     the Code and regulations thereunder. In making such determination, the Plan
     Administrator  may obtain and rely upon the legal  opinion of counsel as to
     the qualification of the order.

          (d) During any period during which the issue of the  qualification  of
     an order is being determined, whether by the Plan Administrator, by a court
     of competent  jurisdiction,  or  otherwise,  the Plan  Administrator  shall
     segregate  in a separate  account in the Plan or in an escrow  account  the
     amounts  which would have been  payable to an  alternate  payee during such
     period if the order had been determined to be qualified.

          (e) If within eighteen (18) months of receipt of the order by the Plan
     Administrator, the order (as it may have been modified)--

               (1) is determined to be a qualified order, the segregated amounts
          (plus any  interest  thereon)  shall be paid to the  person or persons
          entitled thereto under the order (as it may have been modified), or

               (2) is  either  determined  not to be  qualified  or the issue of
          qualification  is not  resolved,  the  segregated  amounts  (plus  any
          interest  thereon) shall be disposed of in the manner which would have
          applied if there had been no order.
<PAGE>

          (f) Any determination that the order (as it may have been modified) is
     qualified  made after the close of the eighteen  (18) month period shall be
     applied prospectively only.

     6.11 Unclaimed  Benefits.  If the Plan  Administrator  has not been able to
ascertain the  whereabouts of any person to whom a payment is due under the Plan
after diligent  efforts have been made to locate the person,  and if, after five
(5) years from the date such  payment is due,  a notice of such  payment  due is
mailed to the last known address of such person,  as shown on the records of the
Plan  Administrator  or the  Company,  and within  three (3)  months  after such
mailing such person has not made written claim therefor, the Plan Administrator,
if it so elects,  after  receiving  advice from counsel to the Plan,  may direct
that such payment and all remaining  benefits under the Plan otherwise due or to
become  due to such  person  be  cancelled  on the  records  of the Plan and the
cancelled  benefits be treated as a forfeiture to be  reallocated  in accordance
with Sections 3.05 and 4.03 hereof to other  Participants'  accounts in the same
manner as Company  contributions.  Upon such cancellation and reallocation,  the
Plan shall have no further  liability  therefor  except that,  in the event such
person later contacts the Plan  Administrator,  provides an address and requests
the benefits due under the Plan,  the  cancelled  benefits  shall be  reinstated
without any adjustment for interest or earnings, and the Company shall make such
additional contribution as may be necessary to fund the reinstated benefits.

<PAGE>

                                   ARTICLE VII
                    LIMITATIONS ON CONTRIBUTIONS AND BENEFITS
                    -----------------------------------------

     7.01 Limitation on Defined  Contribution Plan Annual  Additions.  As and to
the extent  necessary to satisfy the limitations of Section 415 of the Code, the
limitations  of this  Section  7.01 and the  following  Section 7.02 shall apply
notwithstanding  any other provision of this Plan. Annual Additions with respect
to a Participant  under this and all other defined  contribution  plans (whether
terminated  or  not)  ever  maintained  by the  Company  or a  Related  Employer
consisting of:

          (a) all Company contributions and the contributions made pursuant to a
     Salary Reduction Agreement, and all Employee contributions, if any;

          (b) forfeitures, if any;

          (c) the Participant's voluntary contributions, if any;

          (d) amounts  allocated after March 31, 1984, to an individual  medical
     account,  as defined in Section  415(l)(2) of the Code,  which is part of a
     pension or annuity plan maintained by the Company; and

          (e) amounts derived from  contributions paid or accrued after December
     31, 1985, in taxable 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 Section 419A(d)(3) of the Code, under a welfare
     benefit fund, as defined in Section  419(e) of the Code,  maintained by the
     Company;

shall not, with respect to any Limitation Year, exceed the least of:
<PAGE>

               (i)   twenty-five   percent   (25%)  of  the  Code   Section  415
          Compensation  of the  Participant  for the year (excluding any medical
          benefits  described in Sections 401(h) or 419A(f)(2) of the Code which
          are otherwise  treated as Annual  Additions  under Sections  415(b) or
          419A(d)(2)) of the Code;

               (ii)  Thirty  Thousand  Dollars  ($30,000)  as  adjusted  by  the
          Secretary  of the  Treasury  in $5000  increments  for  cost-of-living
          increases, i.e., $35,000 for calendar year 2001; or

               (iii) the maximum amount which, when considered, prior to January
          1, 2000, in  conjunction  with benefits of the  Participant  under all
          defined  benefit  plans  maintained  by  the  Company  or  by  Related
          Employers  does  not  cause  the  limitations  of  Section  415 of the
          Internal  Revenue  Code of 1986,  in effect  from time to time,  to be
          exceeded.

The Annual  Additions for any Limitation  Year beginning  before January 1, 1987
shall  not be  recomputed  to treat  all  Employee  contributions  as an  Annual
Addition. The compensation  limitation referred to in (i) shall not apply to any
contribution  for medical  benefits  (within  the  meaning of Section  401(h) or
Section 419A(f)(2) of the Code) which is otherwise treated as an Annual Addition
under Section 415(l)(1) or 419A(d)(2) of the Code.

     7.02 Overall  Limitation on Defined Benefit and Defined  Contribution  Plan
Benefits.  Subject to such  reduced  limitations  as may be  required  under the
Top-Heavy provisions of Article VIII hereof, with respect to any Limitation Year
beginning prior to January 1, 2000, the sum of a  Participant's  defined benefit
plan fraction and his defined  contribution  plan fraction shall not exceed 1.0.
This limitation shall be applied in accordance with the following provisions.

          (a) A  Participant's  defined  benefit plan  fraction is the projected
     annual benefit of the Participant  under all defined benefit plans (whether
     terminated or not) ever  maintained by the Company or by Related  Employers
     divided by the lesser of--
<PAGE>

               (1) the product of 1.25 multiplied by the dollar  limitation from
          time to time in effect under Section 415(b)(1)(A) of the Code, or

               (2) the  product of 1.4  multiplied  by the  amount  which may be
          taken into account under Section 415(b)(1)(B) of the Code with respect
          to such individual for such year,

all  determined  as of the close of the  Limitation  Year  with such  applicable
adjustments and reductions as are required under Section 415(b) of the Code.

     Notwithstanding  the above,  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 Company which were in existence
on May 6,  1986,  the  denominator  of this  fraction  will not be less than one
hundred  twenty-five percent (125%) 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 plans after May 5, 1986.  The preceding  sentence  shall only
apply if the defined benefit plans  individually and in the aggregate  satisfied
the  requirements of Section 415 of the Code for all Limitation  Years beginning
before January 1, 1987.

          (b) A Participant's  defined  contribution plan fraction is the sum of
     the Annual Additions to the  Participant's  account under this Plan and all
     other  defined   contribution  plans  (whether   terminated  or  not)  ever
     maintained  by the Company or by Related  Employers  as of the close of the
     Limitation Year divided by the lesser of--

               (1)  the sum of the  product  of 1.25  multiplied  by the  dollar
          limitation   in  effect  under  Section   415(c)(1)(A)   of  the  Code
          (determined without regard to subsection (c)(6) thereof) for such year
          and each prior year of service with the Company and Related Employers,
          or
<PAGE>

               (2) the sum of the product of 1.4  multiplied by the amount which
          may be taken into account under Section  415(c)(1)(B)  (or  subsection
          (c)(7),  if  applicable) of the Code for such year and each prior year
          of service with the Company and Related Employers,

all determined as of the close of the Limitation  Year and with such  applicable
limits and adjustments as are required under Section 415(b) of the Code.

     Notwithstanding  the above,  if the  Employee 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  which were in
existence on May 6, 1986, the numerator of this fraction will be adjusted if the
sum of this fraction and the defined benefit fraction would otherwise exceed 1.0
under the terms of this Plan.  Under the  adjustment,  an  amount,  equal to the
product of the excess of the sum of the fractions over 1.0 times the denominator
of this  fraction,  will be  permanently  subtracted  from the numerator of this
fraction.  The  adjustment  is  calculated  using the fractions 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 plans made
after May 6, 1986, but using the Section 415 limitation  applicable to the first
Limitation Year beginning on or after January 1, 1987.

     (c) For purposes of applying the  limitations  of this  Section  7.02,  the
amount of any nondeductible  employee  contributions credited for the Limitation
Year under any defined  benefit  plan  maintained  by the Company or any Related
Employer  shall  be  treated  as an  Annual  Addition  for  the  benefit  of the
Participant under a qualified defined contribution plan.
<PAGE>

     7.03 Benefit Reductions to Meet Annual Addition Limitations. If as a result
of  the  allocation  of  forfeitures,   a  reasonable   error  in  estimating  a
Participant's  annual  compensation or other reason permitted under Treas.  Reg.
1.415-6(b)(6) a Participant's  defined contribution plan annual additions exceed
the limitation of Section 7.01 hereof,  the "Excess Amount" shall be disposed of
as follows:

          (a) Any nondeductible Voluntary  Contribution,  and unmatched Elective
     Deferrals  shall be  returned  to the  Participant  to the extent that they
     would reduce the Excess the Amount.  To the extent  necessary to reduce the
     Excess  Amount,   Non-Highly   Compensated  Employees  will  have  Elective
     Deferrals returned whether or not there is a corresponding match.

          (b) To the extent an Excess Amount still remains after the application
     of (a) above, the Excess Amounts in the Participant's  Account will be used
     to  reduce  Employer   Contributions   (including  the  allocation  of  any
     forfeitures)  for such Participant in the next limitation Year, and in each
     succeeding  Limitation  Year, as necessary,  provided that the  Participant
     otherwise  satisfies the  requirements to receive an allocation of Employer
     contributions in each such Limitation Year;

          (c) To the extent that an Excess Amount  exists after the  application
     of (a) above,  and the Participant is not covered by the Plan at the end of
     the  Limitation  Year,  the Excess  Amount  will be held  unallocated  in a
     suspense  account.  The suspense  account will be applied to reduce  future
     Employer   Contributions  for  all  remaining   Participants  in  the  next
     Limitation Year and in each succeeding Limitation Year as necessary.

          To the extent that a Participant has an Excess Amount  attributable to
     his participation in more than one defined  contribution plan, the required
     reduction in such additions  shall be prorated  among all affected  defined
     contribution  plans,   including  this  Plan,  making  provision  for  such
     reductions.

     7.04 Handling of Forfeitures  Caused by Annual  Additions  Limitation.  Any
reduction  in  Company  contributions  or  forfeitures  to  be  allocated  to  a
Participant  under  this  Plan  in  order  to meet  the  limitation  on  defined
contribution plan annual  additions,  other than a reduction in Salary Reduction
Contributions,  shall be treated as a  forfeiture,  and,  as provided in Section
3.05  and   Section   4.03   hereof  and  in   accordance   with   Treas.   Reg.
1.415-6(b)(6)(i),   shall   be   disposed   of  in   accordance   with   Section
7.03(a)(2)-(3).  Any  portion  of the  reduction  which  cannot be so  allocated
because all  Participants  have reached their maximum  annual  addition shall be
placed in a suspense  account to be  reallocated as a forfeiture in the next and
subsequent  Plan Years as necessary until  exhausted.  All amounts in a suspense
account   created   pursuant  to  this   Section  7.04  shall  be  allocated  to
Participants'   Account   Balances  before  any  further  Employer  or  Employee
contributions  which would  constitute  annual  additions.  The suspense account
shall not share in the  revaluation  of the Fund under  Section  4.05 hereof but
shall remain fixed in amount until  reallocated to the Accounts of Participants.
Any  reduction  in Salary  Reduction  Contributions  to meet the  limitation  on
defined  contribution plan annual additions shall be returned to the Company for
payment to the affected Participant as current compensation.
<PAGE>

     7.05 Salary Reductions in Excess of Permissible Dollar Limits.

          (a) Excess Salary  Reductions.  During any taxable year no Participant
     shall be permitted to have Salary Reduction  Contributions  made under this
     Plan or any other qualified Plan maintained by the Company in excess of the
     dollar limitation  contained in Section 402(g) of the Code in effect at the
     beginning of such taxable year. A  Participant  may assign to this Plan any
     Excess Salary Reduction Contributions made during a taxable year to another
     qualified plan by notifying the Plan  Administrator of the amount of Excess
     Salary  Reduction  Contributions  to  be  assigned  to  this  Plan.  Deemed
     notification of the Plan  Administrator  occurs if Excess Salary  Reduction
     Contributions  arise solely from Salary Reduction  Contributions under this
     Plan or any other Plans of the Company.  Notwithstanding  any provisions of
     this Plan to the contrary, Excess Salary Reduction Contributions,  plus any
     income or minus any loss allocable  thereto,  shall be distributed no later
     than April 15 to such  Participant to whose account Excess Salary Reduction
     Contributions  are assigned for the  preceding  year and who claims  Excess
     Salary Reduction Contributions for such taxable year.

          (b)  Calculations  of Earnings  on Excess  Salary  Reductions.  Excess
     Salary  Reductions  shall be adjusted for any income or loss up to the date
     of distribution.  The income or loss allocable to Excess Salary  Reductions
     is the sum of: (1) income or loss  allocable  to the  Participant's  Salary
     Reduction  Account  for the taxable  year  multiplied  by a  fraction,  the
     numerator of which is such  Participant's  Excess Salary Reductions for the
     year and the  denominator  is the  Participant's  Account  Balance  without
     regard to any income or loss  occurring  during such taxable year;  and (2)
     ten percent  (10%) of the amount  determined  under (1)  multiplied  by the
     number  of  whole  calendar  months  between  the end of the  Participant's
     Taxable  year  and  the  date  of  distribution,   counting  the  month  of
     distribution  if  distribution  occurs after the  fifteenth  (15th) of such
     month.
<PAGE>

     7.06 Limitations on Salary  Reduction  Contributions.  Notwithstanding  any
other  provision of this Plan, the following  limitations  shall apply to Salary
Reduction Contributions:

          (a) Salary Reduction Contributions Must Satisfy Section 401(k) Test.

               (1) Salary Reduction Contributions under Section 3.02 hereof with
          respect  to a Plan  Year  that  are  subject  to Code  Section  401(k)
          restrictions shall satisfy one of the following tests--

                    (A)  The   Actual   Deferral   Percentage   for  the  Highly
               Compensated group of Eligible Participants for a Plan Year is not
               more  than the  Actual  Deferral  Percentage  for the  Non-Highly
               Compensated  group of  Eligible  Participants  for the prior Plan
               Year multiplied 1.25; or

                    (B) The excess of the  Actual  Deferral  Percentage  for the
               Highly Compensated group of Eligible Participants for a Plan Year
               over  the  Actual   Deferral   Percentage   for  the   Non-Highly
               Compensated  group of  Eligible  Participants  for the prior Plan
               Year is not more than two (2) percentage  points,  and the Actual
               Deferral  Percentage for the Highly Compensated group of Eligible
               Participants for a Plan Year is not more than the Actual Deferral
               Percentage  for the  Non-Highly  Compensated  group for the prior
               Plan Year multiplied by two (2).
<PAGE>

Notwithstanding  the foregoing,  at the election of the Company prior to the end
of the Plan Year  immediately  before the Plan Year to which such  election will
apply, the Actual Deferral Percentage tests in subsections (A) and (B) above may
be applied by using the Actual Deferral Percentage of the Non-Highly Compensated
Employees,  eligible to  participate  in the Plan,  for the  current  Plan Year,
instead of the  preceding  Plan Year,  provided that such  election,  once made,
cannot be revoked except as provided in IRS guidance, including IRS Notice 98-1.
In addition,  for the first Plan Year that the Plan permits any  Participant  to
make  Salary  Reduction  Contributions  to the Plan (and this is not a successor
Plan),  for purposes of the foregoing  tests,  the prior Plan Year's  Non-Highly
Compensated  Employees' Actual Deferral  Percentage shall be three percent (3%),
unless the Company has elected to use the Plan Year's Actual Deferral Percentage
for such Participants.

          (2) In the event that this Plan satisfies the requirements of sections
     401(k),  401(a)(4),  or 410(b) of the Code only if  aggregated  with one or
     more other plans, or if one or more other plans satisfy the requirements of
     such  sections  of the Code 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.  Any  adjustments to the
     Actual Deferral Percentage of Non-Highly  Compensated Employees eligible to
     participate in the Plan will be made in accordance  with guidance  provided
     by the IRS,  including  IRS Notice 98-1,  unless the Company has elected to
     use the Current Year Testing  Method.  Plans may be  aggregated in order to
     satisfy section 401(k) of the Code only if they have the same Plan Year and
     use the same  Actual  Deferral  Percentage  testing  method.  The  deferral
     percentage taken into account for any Participant who also  participates in
     other Code Section 401(k) arrangements of the Company or a Related Employer
     shall be the sum of the deferral  percentages for such a Participant  under
     each of such arrangements.
<PAGE>

          (3) For purposes of determining the Actual Deferral  Percentage  test,
     Salary Reduction Contributions and Qualified Non-elective Contributions and
     Qualified Company Matching  Contributions  must be made before the last day
     of the  twelve-month  period  immediately  following the Plan Year to which
     contributions relate.

          (4) The Company  shall  maintain  records  sufficient  to  demonstrate
     satisfaction  of the  Actual  Deferral  Percentage  test and the  amount of
     Company Matching Contributions, or both, used in such test.

     (b) Special Rule for Certain Highly Compensated Employees.  With respect to
Plan Years  beginning  prior to January 1, 1997, for purposes of determining the
Actual Deferral  Percentage of a Participant who is a 5% owner or one of the ten
most  highly  paid  Highly  Compensated  Employees,  the Salary  Reductions  and
Compensation  of such  Participant  shall  include  the  Salary  Reductions  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 Non
Highly  Compensated  Employees and for Participants  who are Highly  Compensated
Employees.

     (c) Excess. If the tests in Subsection (a)(1),  above,  otherwise would not
be  met,  the  following  adjustment  shall  be  made  to the  Salary  Reduction
Contributions  for  Highly  Compensated  Employee  Participants  so  that  after
adjustment one of the two tests is met.
<PAGE>

          (1) On or before the  fifteenth  (15th) day of the third  (3rd)  month
     following  the close of the Plan Year with  respect  to which the limits in
     subsection  (a)(1) are exceeded (i.e.,  March 15th),  but in no event later
     than the last day of the  following  Plan  Year,  each  Highly  Compensated
     Employee  Participant,  beginning with the  Participant  having the highest
     dollar deferral, shall have Salary Reduction Contributions in excess of the
     permissible deferral percentage limits ("Excess Contributions") returned to
     such  Participant  (together with income or loss  allocable  thereon) until
     such Participant's  elective contributions are reduced to the dollar amount
     of the elective  contributions of the Highly Compensated  Employee with the
     next highest  dollar  amount of elective  contributions  and  continuing in
     descending  order with the next Highly  Compensated  Employee with the next
     highest  dollar  deferral,  until one of the  tests  set  forth in  Section
     7.06(a)(1) are satisfied. If such amounts are distributed more than two and
     one-half  (2-1/2)  months  after the last day of the Plan Year in which the
     excess  arose,  a ten  percent  (10%)  excise  tax will be  imposed  on the
     Company.  Such distributions shall be made to Highly Compensated  Employees
     on the  basis  of the  respective  portions  of  the  Excess  Contributions
     attributable  to each such  Employee.  Determination  of income or loss for
     Excess  Contributions  up to the date of distribution  shall be made in the
     same  manner  as  income  or  loss  for  Excess  Salary  Deferrals.  Excess
     Contributions shall be determined under the following procedures:

               (A) Calculate the dollar amount of Excess  Contributions for each
          affected Highly Compensated Employee as follows:

                    (i) Rank all  Highly  Compensated  Employees  in  descending
               order based on their Actual  Deferral  Percentage and then reduce
               the Actual Deferral Percentage of the Highly Compensated Employee
               with  the  highest  Actual  Deferral  Percentage  by  the  amount
               required  to cause  such  Highly  Compensated  Employee's  Actual
               Deferral  Percentage to equal the Actual  Deferral  Percentage of
               the Highly  Compensated  Employee  with the next  highest  Actual
               Deferral  Percentage (or, if less, by the reduction  necessary to
               enable the Plan to satisfy the ADP test);
<PAGE>

                    (ii)  Repeat the  process  in (i) above with  respect to all
               Highly  Compensated   Employees  with  the  next  highest  Actual
               Deferral  Percentage,  until the Plan  satisfies the ADP test and
               the highest permitted Actual Deferral Percentage is determined;

                    (iii) The  amount of  Excess Contributions  for each  Highly
               Compensated  Employee  shall be an  amount  equal to such  Highly
               Compensated Employee's Salary Reduction  Contributions,  plus any
               Qualified   Nonelective   Contributions  or  Qualified   Matching
               Contributions  taken into  account  in  determining  such  Highly
               Compensated   Employee's  Actual  Deferral  Percentage  prior  to
               applying  (i) and (ii)  above,  minus  an  amount  determined  by
               multiplying such Highly  Compensated  Employee's  Actual Deferral
               Percentage,  determined after applying (i) and (ii) above, by the
               Compensation   used  in  determining   such  Highly   Compensated
               Employee's Actual Deferral Percentage;

               (B)  Determine  the total of the  dollar  amounts  (total  Excess
          Contributions) calculated in Step (A);

               (C) Distribute the total Excess  Contributions  determined in (B)
          above as follows:

                    (i) Rank all  Highly  Compensated  Employees  in  descending
               order  based  on the  dollar  amount  of their  Salary  Reduction
               Contributions  and reduce the Salary  Reduction  Contributions of
               the Highly Compensated Employee with the highest dollar amount of
               Salary  Reduction  Contributions  by the amount required to cause
               that Highly Compensated Employee's Salary Reduction Contributions
               to equal the dollar amount of the Salary Reduction  Contributions
               of the Highly  Compensated  Employee with the next highest dollar
               amount of Salary Reduction Contributions.
<PAGE>

                    (ii)  Distribute  the amount  determined in (i) above to the
               Highly Compensated  Employee with the highest dollar amount until
               all  Excess  Contributions  are  consumed,  or until  the  Salary
               Reduction  Contributions  of this  Participant are reduced to the
               dollar  amount of the Highly  Compensated  Employee with the next
               highest dollar amount of Salary Reduction  Contributions;

               (D) If the total amount  distributed under (C) above is less than
          the Total Excess contributions, repeat step (C).

          (2) Alternatively, with respect to such Plan Year, the Company may, in
     its  discretion,   make  qualified   non-elective  and  qualified  matching
     contributions,  as defined in Treas. Reg.  ss.1.401(k)-1(g)(7) as necessary
     in  order  for  the  tests  in  subsection  (a)(1)  to be  satisfied.  Such
     contributions shall be fully vested and subject to the same restrictions on
     distribution as Salary Reduction Contributions. If the Plan uses prior year
     testing, then the non-discrimination requirements of this Section 7.06 must
     be  met  for  each  Plan  Year,  regardless  that  Qualified   Non-Elective
     Contributions  allocated to  Non-Highly  Compensated  Employees in one Plan
     Year  will  count  toward  the  Actual  Deferral  Percentage  test  for the
     following Year.

          (3) Notwithstanding the foregoing,  the amount of Excess Contributions
     to be  recharacterized  or  distributed  under this  Section  7.06(c)  with
     respect to a Highly Compensated  Employee for a Plan Year is reduced by any
     excess deferrals previously distributed to such Employee for the Employee's
     taxable year ending with or within the Plan Year,  and the amount of excess
     deferrals to be  distributed  under this Section  7.06(c) with respect to a
     Highly  Compensated  Employee  for a Plan  Year is  reduced  by any  Excess
     Contributions  previously  recharacterized  or distributed to such Employee
     for the Employee's taxable year ending with or within the Plan Year.
<PAGE>

     7.07   Average   Contribution   Percentage   Test  for   Company   Matching
Contributions.

          (a) With  respect to each Plan Year,  Company  Matching  Contributions
     under  Section  3.02 hereof with respect to a Plan Year that are subject to
     Code Section 401(m) shall satisfy one of the following tests--

               (1) The  Average  Contribution  Percentage  for a Plan  Year  for
          Highly Compensated  Employees who are Eligible  Participants shall not
          exceed the Average Contribution Percentage for the prior Plan Year for
          Non-Highly   Compensated  Employees  who  are  Eligible  Participants,
          multiplied by 1.25; or

               (2) The  Average  Contribution  Percentage  for a Plan  Year  for
          Highly Compensated  Employees who are Eligible  Participants shall not
          exceed the Average Contribution Percentage for the prior Plan Year for
          the Non-Highly  Compensated Employees who are Eligible Participants by
          more than two (2)  percentage  points,  and the  Average  Contribution
          Percentage for such Highly Compensated  Employee group for a Plan Year
          shall not be more than the  Average  Contribution  Percentage  for the
          prior  Plan  Year  for such  Non-Highly  Compensated  Employee  group,
          multiplied by two (2).

Notwithstanding  the foregoing,  at the election of the Company prior to the end
of the Plan Year  immediately  before the Plan Year to which such  election will
apply, the Average  Contribution  Percentage Tests above may be applied by using
the Average Contribution  Percentage of Non-Highly Compensated Employees who are
eligible  Participants for the then current Plan Year,  instead of the preceding
Plan Year,  provided that such election,  once made, cannot be revoked except as
provided in IRS guidance, including IRS Notice 98-1.

<PAGE>

          (b) In the event that this Plan satisfies the requirements of sections
     401(m), 401(a)(4) or 410(b) of the Code only if aggregated with one or more
     other plans, or if one or more other plans satisfy the requirements of such
     sections of the Code only if aggregated  with this Plan,  then this section
     shall be applied by determining the Contribution Percentage of employees as
     if such plans were a single plan. For Plan Years  beginning  after December
     31, 1989, plans may be aggregated in order to satisfy section 401(m) of the
     Code only if they have the same Plan Year. If a Highly Compensated Employee
     is eligible to participate  in two or more plans  maintained by the Company
     or by the Company and a Related Employer,  to which such  contributions are
     being made,  all such  contributions  shall be  aggregated  for purposes of
     applying this Section 7.07(b).

          (c) With respect to Plan Years beginning prior to January 1, 1997, for
     purposes of determining the Contribution Percentage of a Participant who is
     a five  percent  (5%) owner or one of the ten (10) most  highly paid Highly
     Compensated Employees,  the Contribution Percentage amount and Compensation
     of such Participant shall include the 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 Participants
     who are  Non-Highly  Compensated  Employees  and for  Participants  who are
     Highly  Compensated  Employees.

          (d) Excess.  If the tests in subsection (a) above  otherwise would not
     be met, the following  adjustment  shall be made with respect to the excess
     Company Matching  Contributions of Highly Compensated  Participants so that
     after adjustment one of the two tests is met--
<PAGE>

               (1) On or before  the  fifteenth  (15th)  day of the third  (3rd)
          month  following  the close of the Plan Year with respect to which the
          limits in subsection (a) are exceeded,  but in no event later than the
          close of the following  Plan Year, the Plan  Administrator  may direct
          the  Trustee to  distribute  to each Highly  Compensated  Participant,
          beginning with the Participant  having the greatest  excess  aggregate
          contributions,  the  amount  of such  excess  aggregate  contributions
          (together with income or loss allocable thereon determined in the same
          manner as for Excess Salary Reductions under this Plan) and continuing
          as  necessary,  until his aggregate  contributions  are reduced to the
          aggregate  contributions of the Highly  Compensated  Employee with the
          next highest aggregate  contributions  and so forth,  until subsection
          (a) is  satisfied.  Such  distributions  shall be made to each  Highly
          Compensated  Employee on the basis of the  respective  portions of the
          excess aggregate contributions attributable to such Highly Compensated
          Employee as determined under the following procedures:

                    (A)  Calculate   the  dollar  amount  of  excess   aggregate
               contributions  for each affected Highly  Compensated  Employee as
               follows:

                    (i) reduce the Average Contribution Percentage of the Highly
                    Compensated  Employee with the highest Average  Contribution
                    Percentage  by the amount  required to cause the ACP test to
                    be met or, if greater,  by the amount required to cause such
                    Highly   Compensated    Employee's   Average    Contribution
                    Percentage to equal the Average  Contribution  Percentage of
                    the  Highly  Compensated  Employee  with  the  next  highest
                    Average Contribution Percentage;

                    (ii)  repeat  the  process  in (i)  above,  until  the  Plan
                    satisfies  the ACP test and the  highest  permitted  Average
                    Contribution Percentage is determined ;
<PAGE>

                    (iii) the amount of excess aggregate  contributions for each
                    Highly Compensated Employee shall be an amount equal to such
                    Highly Compensated Employee's Company Matching Contributions
                    taken into account in  determining  such Highly  Compensated
                    Employee's Average Contribution Percentage prior to applying
                    (i)  and  (ii)  above,   minus  an  amount   determined   by
                    multiplying  such  Highly  Compensated   Employee's  Average
                    Contribution  Percentage,  determined after applying (i) and
                    (ii) above,  by the  Compensation  used in determining  such
                    Highly   Compensated    Employee's   Average    Contribution
                    Percentage;

                    (B)  Determine  the  total  of the  dollar  amounts  (excess
               aggregate contributions) calculated in Step (A);

                    (C)  Distribute  the total  excess  aggregate  contributions
               determined in (B) above as follows:

                    (i) Reduce the Company Matching  Contributions of the Highly
                    Compensated  Employee  with the  highest  dollar  amount  of
                    Company  Matching  Contributions  by the amount  required to
                    cause that Highly  Compensated  Employee's  Company Matching
                    Contributions  to equal the  dollar  amount  of the  Company
                    Matching  Contributions of the Highly  Compensated  Employee
                    with the next  highest  dollar  amount of  Company  Matching
                    Contributions.

                    (ii)  Distribute  the amount  determined in (i) above to the
                    Highly  Compensated  Employee with the highest dollar amount
                    (however,  if a lesser  reduction,  when  added to the total
                    dollar amount  already  distributed  under this step,  would
                    equal the total excess aggregate  contributions,  distribute
                    the lesser reduction amount);
<PAGE>

                    (D) If the total amount  distributed under (C) above is less
               than the total excess aggregate contributions, repeat step (C).

               (2)  If  the  Company  has  timely   elected   that  the  Average
          Contribution  Percentage Tests in Subsection (a) above will be applied
          using the Average Contribution  Percentages of Non-Highly  Compensated
          Employees  for the current Plan Year,  then,  with respect to the Plan
          Year for which the Company has elected to use the current year Average
          Contribution  Percentages  of Non-Highly  Compensated  Employees,  the
          Company  may,  in its  discretion,  make such  qualified  non-elective
          contributions,  subject to the  requirements  for full vesting and the
          401(k) withdrawal restrictions described in Section 6.01(g) hereof, as
          may be necessary for the tests in subsection (a) to be satisfied.

               (3) In its discretion,  Plan  Administrator may limit Employee or
          Matching  Contributions  in a manner that  prevents  excess  aggregate
          contributions  from being made,  provided that any such limit shall be
          nondiscriminatory,  applied  on  a  uniform  basis  and  permitted  by
          applicable provisions of the Code and regulations thereunder


               (4)  Alternatively,  instead  of  distributing  excess  aggregate
          contributions,  the Plan  Administrator  may forfeit  excess  Matching
          Contributions,   if  forfeitable,   and  apply  such   forfeitures  in
          accordance with Section 3.05.

          (d) For  purposes of  determining  the  Contribution  Percentage  test
     Matching  Contributions  will be considered made for a Plan Year if made no
     later than the end of the twelve  (12) month  period  beginning  on the day
     after the close of the Plan Year.

          (e) The Company  shall  maintain  records  sufficient  to  demonstrate
     satisfaction of the Average Contribution  Percentage Test and the amount of
     Company Matching Contributions, or both, used in such test.
<PAGE>


     Section 7.08 Multiple Use  Limitation.  In the event the test  described in
Section 7.07(a) is satisfied using the "2.0/two point" test described in Section
7.07(a)(2),  the Average Contribution  Percentage described in this Section 7.08
for Highly  Compensated  Employees  shall be reduced to the extent  necessary to
satisfy the aggregate limit described in the following  sentence.  The aggregate
limit shall equal whichever of (A) or (B) is greater:

          (a) the sum of (i)  1.25  multiplied  by the  greater  of the  Average
     Contribution Percentage or the Actual Deferral Percentage for the Plan Year
     for all Eligible  Employees  other than Highly  Compensated  Employees plus
     (ii) the  lesser  of the  Average  Contribution  Percentage  or the  Actual
     Deferral Percentage for the Plan Year for all Eligible Employees other than
     Highly Compensated Employees plus two percentage points; provided, however,
     that the  amount  determined  under  this  clause  (ii) may not  exceed the
     product  of 2.0  multiplied  by the  lesser  of  the  Average  Contribution
     Percentage  or the  Actual  Deferral  Percentage  for the Plan Year for all
     Eligible Employees other than Highly Compensated Employees; or

          (b)  the sum of (i)  1.25  multiplied  by the  lesser  of the  Average
     Contribution Percentage or the Actual Deferral Percentage for the Plan Year
     for all Eligible  Employees  other than Highly  Compensated  Employees plus
     (ii) the  greater  of the  Average  Contribution  Percentage  or the Actual
     Deferral Percentage for the Plan Year for all Eligible Employees other than
     Highly Compensated Employees plus two percentage points; provided, however,
     that the  amount  determined  under  this  clause  (ii) may not  exceed the
     product  of 2.0  multiplied  by the  greater  of the  Average  Contribution
     Percentage  or the  Actual  Deferral  Percentage  for the Plan Year for all
     Eligible Employees other than Highly Compensated Employees.

If the aggregate limit described above would be exceeded for any Plan Year, then
the limit shall be met by reducing the actual deferral  percentage,  the Average
Contribution  Percentage of highly compensated employees or a combination of the
two in a manner described in Treas.Reg.  ss.1.401(m)-2(c)(3).  Alternatively the
Company may eliminate the multiple use of the  alternative  limitation by making
qualified nonelective  contributions in accordance with  ss.4.01(k)-1(b)(5)  and
(f)(1) or ss.1.401(m)-1(b)(5) and (e)(1).
<PAGE>


                                  ARTICLE VIII
                             TOP-HEAVY REQUIREMENTS
                             ----------------------

     8.01 When Top-Heavy  Provisions Are Operative.  The Top-Heavy provisions of
this Article VIII shall supersede any Plan provisions  failing to meet or exceed
the requirements for Top-Heavy plans under Section 416 of the Code. In the event
that  Congress  should  provide by statute,  or the Treasury  Department  or the
Internal Revenue Service should provide by regulation or ruling, or it should be
judicially or otherwise determined that the Top-Heavy provisions provided for in
this Plan, or any part thereof,  are not necessary in order for the Plan to meet
the  requirements  for a qualified profit sharing plan under the Code for a Plan
Year, such  provisions,  or part thereof,  shall become void and shall not apply
for such Plan Year without the necessity of amendment to the Plan.

     8.02 Top-Heavy Limitation on Annual  Compensation.  The annual compensation
of any  Employee  taken into  account  under the Plan for a Top-Heavy  Plan Year
shall not the limit on compensation  contained in Section 410(a)(17) of the Code
($170,000  for Plan Year 2000 or such larger  amount as may from time to time be
fixed by the  Secretary of the Treasury or his delegate to reflect the statutory
cost-of-living adjustment).

     8.03 Top-Heavy Minimum Contributions.

          (a) If the Plan is Top-Heavy for a Plan Year, the Company contribution
     (including  reallocated  forfeitures)  allocated to each  Non-Key  Employee
     Participant  who is  employed  by the  Company  at the end of the Plan Year
     shall  not  be  less  than  the  required   Top-Heavy   percentage  of  the
     Participant's  compensation  (as defined in Code  Section 415) for the Plan
     Year. The required Top-Heavy  percentage is the lesser of (1) three percent
     (3%), or (2) the percentage at which contributions  (including  reallocated
     forfeitures)  are made (or required to be made) under the Plan for the Plan
     Year for the Key  Employee  Participant  for whom  such  percentage  is the
     highest for the Plan Year. In determining a Key  Employee's  percentage for
     purposes of (2), above,  (i) all defined  contribution  plans included in a
     required aggregation group with the Plan shall be treated as one plan, (ii)
     for Plan Years  beginning after December 31, 1988,  elective  contributions
     and, for Plan Years beginning after December 31, 1984, amounts  contributed
     pursuant to a salary  reduction  agreement shall be included in determining
     the  amount  contributed  on  behalf  of a  Key  Employee,  and  (iii)  the
     contributions  allocated to the Key Employee shall be divided by so much of
     the Key Employee's total  compensation for the Plan Year as does not exceed
     the  compensation  limit  contained  in  Section  401(a)(17)  of  the  Code
     ($170,000 for 2000). The Top-Heavy  minimum  allocation shall be determined
     without  regard to any social  security  contribution  by the  Company  and
     without  regard to any elective  contributions  made on behalf of Employees
     other than Key Employees.
<PAGE>

          (b) Any  individual who would  otherwise fail to be allocated  Company
     contributions for the Plan Year because such individual has--

               (1)  failed  to   complete   1,000   Hours  of  Service  (or  the
          equivalent),

               (2) declined to make mandatory contributions to the Plan,

               (3) declined to elect Salary Reduction Contributions to the Plan,
          or

               (4)  been  excluded  from  the  Plan  because  such  individual's
          compensation  is less than a stated amount (even though the individual
          must be considered a participant to satisfy the coverage  requirements
          of Code Section  410(b) in  accordance  with Code  Section  401(a)(5))
          shall be  considered  a  Participant  for  purposes  of  applying  the
          Top-Heavy minimum contribution requirements of this Section 8.03.

          (c) If for any Plan Year in which the Plan is Top-Heavy, but not Super
     Top-Heavy,  the Company maintains both a defined benefit plan and a defined
     contribution  plan and the  adjusted  Code  Section  415 limits  under Code
     Section   416(h)(1)  would  otherwise  be  exceeded,   then,  to  meet  the
     requirements of Code Section 416(h)(2) and to avoid the application of Code
     Section   416(h)(1),   the  three  percent  (3%)   requirement  in  Section
     8.03(a)(1), above, shall be increased to four percent (4%) for Participants
     covered only by a defined contribution plan.

          (d) The foregoing notwithstanding,  no Top-Heavy minimum benefit shall
     be provided  under this Plan for any  Participant  with respect to any Plan
     Year for which the  Participant is covered under another  qualified plan or
     plans of the Company or a Related  Employer and is receiving  the Top-Heavy
     minimum benefits or  contributions  required by Code Section 416 under such
     other plan if the  Company has  provided  that the  minimum  allocation  or
     benefit  requirement  will be met in the other plan or plans. To the extent
     that a  Top-Heavy  minimum  benefit is due to a  Participant,  unless  such
     minimum  benefit  is  provided  under  another  plan or plans,  it shall be
     provided under this Plan,  but only to the extent  necessary to satisfy the
     Top-Heavy minimum allocation without duplication.

          (e)  Neither  a  Participant's  Salary  Reduction   Contributions  nor
     Matching  Contributions  shall be considered for the purposes of satisfying
     the minimum top heavy contribution requirement of this Section.
<PAGE>

     8.04 Top-Heavy  Minimum Vesting.  If the Plan is Top-Heavy for a Plan Year,
vesting  in  Account  Balances  under  the  Plan  for such  Plan  Year  shall be
determined under the following Vesting Schedule:

                 Years of                    Vested Percentage
              Vesting Service              of Accrued  Benefits
              ---------------              --------------------
                less than 2                         0%
                     2                             40%
                     3                             60%
                     4                             80%
                     5                            100%

Any change in Vesting  Schedules under this section shall be deemed to be a Plan
amendment  subject  to the  limitations  on  reduction  of vested  benefits  and
Participant election rights as set forth in Section 5.11. To the extent required
to be  nonforfeitable  under Section 416(b) of the Code,  the minimum  Top-Heavy
allocation  may  not  be  forfeited   under  Section   411(a)(3)(B)  or  Section
411(a)(3)(D) of the Code.

     8.05  Top-Heavy  Limitations  on  Benefits.  With  respect  to  Plan  Years
commencing  before January 1, 2000, if the Plan is Top-Heavy or Super  Top-Heavy
for a Plan Year,  the  limitations  of Section  7.02 hereof  shall be applied as
provided in this Section 8.05.

          (a) If the Plan is  Top-Heavy,  but not  Super  Top-Heavy,  for a Plan
     Year, Code Section 416(h)(1) will not apply to the Plan and the limitations
     of Section  7.02 shall be applied  according  to their  terms  without  any
     substitutions,  if the  requirements  of  Code  Section  416(h)(2)  are met
     pursuant to Section 8.03(c) or Section 8.05(c) hereof.

          (b) If the Plan is  Top-Heavy,  but not  Super  Top-Heavy,  for a Plan
     Year,  the  application  of Code Section  416(h)(1)  will be suspended with
     respect to a Participant  and the  limitations of Section 7.02 with respect
     to such Participant  shall be applied  according to their terms without any
     substitutions,  as long as the  requirements of Code Section  416(h)(3) are
     met, i.e. as long as there are no--

               (1)   employer   contributions,    forfeitures,    or   voluntary
          nondeductible contributions allocated to the Participant, or

               (2) accruals for the Participant under the defined benefit plan.


<PAGE>

          (c) If  neither  (a) nor (b)  applies,  Code  Sections  416(h)(1)  and
     416(h)(4) will apply to the Plan and "1.0" shall be substituted  for "1.25"
     in calculating a  Participant's  defined  benefit plan fraction and defined
     contribution  plan fraction  under  Section  7.02(a) and (b) hereof and the
     defined  contribution   fraction  denominator  as  computed  under  Section
     415(e)(6)  of the Code shall be  modified  by  substituting  "$41,500"  for
     $51,875", unless:

               (1) the Plan would not be Top-Heavy if 90% were  substituted  for
          60% in the definition of Top-Heavy in the Glossary, and

               (2)(a) Four percent (4%) is  substituted  for three  percent (3%)
          under Section  8.03(c) hereof and the defined benefit plan provides an
          additional Top-Heavy minimum accrual of one percent (1.0%) per Year of
          Service;  or (b) this Plan provides a Top-Heavy minimum  allocation of
          seven and one-half percent (7.5%) of compensation.

          (d) If  "1.0" is  substituted  for  "1.25"  as set  forth  in  Section
     8.05(c),  above,  a  Participant  covered by a defined  benefit  plan and a
     defined  contribution  plan  shall  receive  the  defined  benefit  minimum
     benefit.

     8.06 Determination of Top Heavy Status. Whether this Plan or any other Plan
included  in a  required  aggregation  group of which this Plan is a part is Top
Heavy  (within  the meaning of Section  416(g) of the Code) shall be  determined
under (a) the method,  if any, that uniformly applies for accrual purposes under
all  plans  maintained  by the  Related  Employees,  or (b) if  there is no such
method,  as if such benefit  accrued not more  rapidly than the slowest  accrual
rate permitted under the fractional accrual rate of Section  411(b)(1)(C) of the
Code.
<PAGE>

                                   ARTICLE IX
                        AMENDMENT, MERGER OR TERMINATION
                        --------------------------------

     9.01 Amendment.  The Company  reserves the right, at any time and from time
to time, by action of its Board of Directors or its duly authorized officers, to
amend or modify the Plan,  in part or in whole,  for any reason and  without the
consent of any Fiduciary,  Employee,  Participant,  Beneficiary or other person.
Unless  required or  permitted  by the Code or other law, no such  amendment  or
modification   (including   those  made  in  connection  with   establishing  or
maintaining the qualified status of the Plan) shall authorize or permit any part
of the funds held under this Plan to be used for, or diverted to, purposes other
than the payment of taxes,  the payment of Plan  administrative  expenses or for
the exclusive benefit of Employees or their Beneficiaries, or shall be effective
to the  extent  that it has the effect of  decreasing  a  Participant's  accrued
benefit,  including any early  retirement  benefit,  retirement-type  subsidy or
optional form of benefit  protected by Code Section  411(d)(6).  For purposes of
this  paragraph,  a  Plan  amendment  which  has  the  effect  of  decreasing  a
Participant's  Account Balance 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.  Any amendment or  modification  of the
Plan may be  retroactive  if (a) it does not impair  any  rights to any  benefit
under  the  Plan  which  any  Participant,  Beneficiary  or other  person  would
otherwise  have had at the date of such  amendment  by reason  of  contributions
theretofore  made or (b) it is necessary or  appropriate  to qualify or maintain
the Plan as a plan and trust exempt from federal income  taxation under Sections
401(a),  501(a) and related  provisions of the Code, the provisions of ERISA, or
any other  applicable  provisions  of federal or state law,  as now in effect or
hereafter amended or adopted,  and any regulations issued thereunder,  including
without  limitation  any  regulations  issued  by  the  United  States  Treasury
Department  or the United  States  Department  of Labor.  Any  amendment  to the
vesting  provisions  of the Plan  shall be  subject  to the  rights  of  certain
Participants  to elect to have their vested benefits  determined  under the Plan
without regard to such amendment as provided in Section 5.11 hereof.
<PAGE>

     9.02 Merger or  Consolidation.  The Company  reserves the right at any time
and from time to time by action of its Board of Directors or its duly authorized
officers to merge or  consolidate  the Plan with,  or to transfer  any assets or
liabilities  to,  any  other  plan,  provided,  however,  that no  such  merger,
consolidation  or transfer may be undertaken  unless each  Participant  would be
entitled to receive a benefit  after such merger,  consolidation  or transfer if
such  other plan then  terminated  which  would be equal to or greater  than the
benefit each Participant  would have been entitled to receive  immediately prior
to such  merger,  consolidation  or transfer  if this Plan had then  terminated.
Satisfaction of this provision  shall be determined  without regard to decreases
or increases in Account Balances due to investment performance.

     9.03  Termination.  Although  the  Company  expects to  continue  this Plan
indefinitely, it reserves the right, at any time and from time to time by action
of its  Board of  Directors  or its duly  authorized  officers,  to  suspend  or
terminate prospectively its obligation to pay the costs of or make contributions
to the  Plan or to  terminate  or  partially  terminate  the  Plan,  subject  to
requirements of collective bargaining.  Complete and permanent discontinuance of
contributions  under the Plan shall  constitute a termination  of the Plan.  All
affected  Participants  with  respect  to whom the Plan has been  completely  or
partially  terminated  shall be fully vested in their Account Balances as of the
date of termination. During the termination process the named Fiduciaries of the
Plan  shall  remain  in  existence  and the  provisions  of the Plan  which  are
necessary or appropriate  for the execution of the Plan and the  distribution or
transfer of the assets of the Plan shall remain in force.

     9.04 Termination Distributions.  Upon termination or partial termination of
the Plan, no amount shall  thereafter be payable under the Plan to or in respect
of a Participant affected by such termination except as provided in this Section
9.04. In the event of the  termination of the Plan, the Account  Balance of each
affected Participant will be nonforfeitable.  To the maximum extent permitted by
law,  transfers or distributions of Plan assets as provided in this Section 9.04
shall constitute a complete  discharge of all liabilities  under the Plan. After
provision  for all expenses of  administration  and  liquidation,  any remaining
assets of the Plan which are available to provide  benefits  shall be liquidated
and the proceeds  distributed  among,  or applied to provide  benefits for or in
respect of, the Participants affected by such termination. Such distributions or
benefits  shall be made or paid in such manner as the Plan  Administrator  shall
determine  from among the forms of payment  permitted  by Section 6.03 hereof or
other payment forms as may be approved by the Internal Revenue  Service.  In the
discretion of the Plan  Administrator or as may be required by applicable law or
regulation,  benefit payments,  including regular payments to retirees under the
Plan, may be made during the Plan termination process.
<PAGE>


                                    ARTICLE X
                       PLAN FIDUCIARIES AND ADMINISTRATION
                       -----------------------------------

     10.01  Administration  by Named  Fiduciaries.  The named Fiduciaries of the
Plan are the Company,  the Board of Directors  of the  Company,  the  Retirement
Committee,  the Investment Committee,  the Review Committee, the Trustee and any
other  Fiduciary  identified  as a  named  Fiduciary  from  time  to time by the
Company.  The operation and  administration  of the Plan shall be controlled and
managed by the named  Fiduciaries.  Each named Fiduciary shall have such duties,
powers and authority and only such duties,  power and authority as are set forth
with respect to it in the Plan,  and each shall be liable  therefor  only to the
extent  and  under  the  conditions  set  forth in this  Article  X.  The  named
Fiduciaries shall administer the Plan in a uniform and nondiscriminatory  manner
consistent  with the intention  that the Plan be a qualified plan under Sections
401(a) and related provisions of the Code.

     10.02  Retirement  and Investment  Committees.  There shall be a Retirement
Committee  consisting  of the members  appointed by the Board of Directors  from
time to time.  The  Retirement  Committee  shall also function as the Investment
Committee for the Plan, unless it appoints a separate Investment  Committee.  In
the absence of any members to constitute said Committees, the Company shall have
and  exercise all the power and  authority  herein  granted to such  Committees.
Members  of the  Retirement  and  Investment  Committees  may be  Employees  and
Participants, provided, however, that no member of a Committee shall be entitled
to act on or decide any matter relating solely to any of such member's rights or
benefits under the Plan. The members of the Retirement and Investment Committees
may receive reasonable  compensation for their services, and shall be reimbursed
by the Company for all  necessary  expenses  incurred in the  discharge of their
duties; expressly provided, however, that no member of any such Committee who is
receiving  compensation  as an employee of the Company may receive  compensation
for his or her services as a member of a fiduciary Committee.  Each member shall
signify  acceptance of appointment by filing a written acceptance with the Board
of Directors or by undertaking the duties of office,  and may resign at any time
by  written  notice  to  the  Board  of  Directors.  The  Retirement  Investment
Committees  shall  establish  their  own  procedures  and the time and place for
meetings,  provide for the keeping of the  minutes of all  meetings  and actions
taken (copies of which shall be available to the Board of Directors),  and shall
report  to the  Board  of  Directors  from  time to time  as  appropriate  or as
specified by the Board with regard to matters for which they are responsible.  A
majority  of the  members  of a  Committee  shall  constitute  a quorum  for the
transaction  of  business,  and any action of a Committee  may be taken upon the
affirmative  vote of a majority of the members of the Committee at a meeting or,
at the  direction  of its  Chair,  without  a  meeting  by  mail,  telegraph  or
telephone,  provided that all the members of the Committee are informed by mail,
telegraph or telephone of their right to vote on the proposal and of the outcome
of the vote thereon. Each Committee may appoint such officers in addition to its
Chair as it deems appropriate,  including a Secretary, who may but need not be a
member of the Committee,  to keep its records and otherwise assist the Committee
in the  performance  of its duties.  Each  Committee may appoint from its number
such sub-committees as it shall determine,  may authorize one or more members or
any agent to execute or deliver any instrument or instruments on its behalf, may
employ such agents,  counsel (which may be counsel for the Company),  investment
and other  professional  advisers  as it may deem  necessary  or  advisable  for
purposes of the Plan and may delegate to any such agent or to any  sub-committee
or member authority to perform any act hereunder,  including without  limitation
those  matters  involving  the  exercise  of  discretion,   provided  that  such
delegation  shall be subject to revocation at any time in the  discretion of the
Committee.  The reasonable expenses of each Committee,  including charges of its
counsel, agents and professional advisers, shall be an administrative expense of
the Plan to be paid in accordance with Section 3.07 hereof.
<PAGE>

     10.03 Retirement  Committee To Be Plan  Administrator;  Duties,  Powers and
Authority of Plan  Administrator.  The  Retirement  Committee  shall be the Plan
Administrator.  The Plan  Administrator  shall  be  responsible  for the  Plan's
operation  and  administration,  including  but not  limited to  complying  with
reporting and disclosure requirements and maintaining of Plan records. Except as
to  such  powers  and  authority  as  are  expressly  reserved  to  other  named
Fiduciaries, the Plan Administrator shall possess and may exercise all power and
authority with respect to the control, management,  operation and administration
of the Plan, including the power to allocate fiduciary  responsibilities  (other
than those of the Trustee) among named  Fiduciaries,  to designate persons other
than named Fiduciaries to carry out fiduciary responsibilities (other than those
of the  Trustee)  and to  engage  such  actuaries  and  accountants  (who may be
accountants  for the Company) as it may deem necessary or advisable for purposes
of the Plan. The Plan  Administrator may adopt such rules for the conduct of its
business and  administration  of the Plan as it considers  desirable,  including
rules with respect to election periods,  the presentation of claims for benefits
under the Plan and appeals from any denial of such claims,  provided they do not
conflict with  applicable law or the terms of the Plan.  The Plan  Administrator
shall have the  exclusive  right to interpret  the  provisions  of the Plan,  to
decide any question arising  thereunder or in connection with the administration
of the Plan  (including  the authority to remedy any  omissions,  ambiguities or
inconsistencies),  to determine any claims  concerning  the  eligibility  of any
person to participate in the Plan or the right of any person to receive benefits
under  the  Plan  and to  authorize  the  payment  of such  benefits.  The  Plan
Administrator's  decision  or action  in  respect  of any of the above  shall be
conclusive and binding upon all  Participants  and their  Beneficiaries,  heirs,
assigns,  administrators,  executors  and any other person  claiming  through or
under them, subject to such individual's rights to a review of the denial of any
benefit claim under the benefit  claims  provisions of Section 6.09 hereof.  The
Plan  Administrator  shall keep records of its  administration of the Plan and a
Participant  shall have the right to inspect such records as they relate to such
Participant's interest under the Plan.
<PAGE>

     10.04 Duties, Powers and Authority of Investment Committee.  The Investment
Committee shall  periodically  review the investment  performance and methods of
the Trustee and any other funding agency, including any insurance company, under
the Plan and shall make recommendations to the Board of Directors of the Company
concerning the  appointment,  continuation,  removal or change of the Trustee or
any such funding agency. The Investment Committee shall have the power to direct
the Trustee as to the  management,  acquisition  or  disposition  of Plan assets
constituting a portion or portions or all of the Fund. The Investment  Committee
shall  have  the  power  to  appoint  or  remove  from  time to time one or more
investment advisers and to delegate to any such adviser authority and discretion
to manage,  acquire or dispose of Plan assets constituting a portion or portions
or all of the Fund provided that,

          (a) each adviser with such authority and  discretion  shall be a bank,
     an  insurance  company  or  a  registered   investment  adviser  under  the
     Investment Advisers Act of 1940 and shall acknowledge in writing that it is
     a fiduciary with respect to the Plan, and

          (b) the Investment  Committee shall periodically review the investment
     performance and methods of each adviser with such authority and discretion.

The  Investment  Committee  shall  establish  investment  standards and policies
incorporating as pertinent such requirements and objectives of the Plan or other
information  (including the Plan's funding method and any interest rate or other
actuarial  assumptions)  communicated to it by other Plan  Fiduciaries and shall
communicate  such  standards  and  policies  to the  Trustee  (or other  funding
agencies  under  the  Plan)  and  to any  investment  advisers.  The  Investment
Committee  shall  determine  the  investment  options  (such  as  equity,   cash
equivalent  or other  funds  managed by an  investment  adviser,  the Trustee or
others) to be made  available  under the Plan from time to time for  election by
Participants (or their Beneficiaries).

     10.05 Trust Fund and Trustee.  All Plan assets  constituting  the Fund held
for purposes of the Plan shall consist  either of assets held in trust by one or
more Trustees  appointed  from time to time by the Company.  There shall be such
powers  in  the  Trustees  and  the  Retirement   Committee  as  to  investment,
reinvestment,  control and disbursement of the Fund as provided hereunder and in
any such insurance contracts or Trust Agreements; provided, however, that in the
event the Plan is fully  insured,  any dividends or credits  earned on insurance
contracts  will be  applied,  within the  taxable  year of the  Company in which
received or within the next  succeeding  taxable year,  toward the next premiums
due before any further employer  contributions  are so applied.  Generally,  the
Trustees  shall  have  authority  over and  responsibility  for the  management,
acquisition and disposition of Plan assets constituting the portion of the Fund,
if any,  and  even to the  whole  thereof,  which  is not  being  managed  by an
insurance  company or pursuant to the  directions of another Plan Fiduciary or a
Plan Participant.  The Trustee's powers and duties shall be such, and only such,
as are expressly set forth in the Plan,  including the Trust  Agreement to which
it is a party. In the event of any conflict between the provisions of such Trust
Agreement and other  provisions of the Plan with respect to the Trustee's powers
and duties, such Trust Agreement shall control.

     10.06 Agent for Service of Legal  Process.  The Secretary of the Company or
such  other  person  as may  from  time  to  time  be  designated  by  the  Plan
Administrator shall be the Plan's agent for service of legal process.
<PAGE>

     10.07 Company Actions.  Whenever under the terms of the Plan the Company is
required or  permitted  to do or perform any act,  matter or thing,  it shall be
done or performed by a duly authorized officer of the Company.

     10.08   Communications  To  and  From  Plan  Fiduciaries.   All  elections,
designations,  requests, notices,  instructions, and other communications from a
Participant,  Beneficiary  or other  person to the Plan  Administrator  or other
Fiduciary of the Plan which are required or permitted under the Plan shall be in
such form as is prescribed by or acceptable to the Plan  Administrator from time
to time,  shall be mailed by  first-class  mail or delivered to such location as
shall be specified by the Plan  Administrator,  and shall be deemed to have been
given and delivered only upon actual receipt  thereof by the Plan  Administrator
or other  appropriate  Fiduciary  of the  Plan at such  location.  All  notices,
statements,  reports  and  other  communications  from  the  Company,  the  Plan
Administrator  or  other  Fiduciary  of the Plan to any  Employee,  Participant,
Beneficiary or other person which are required or permitted under the Plan shall
be deemed to have been duly given when delivered or mailed first-class,  postage
prepaid,  to the address last appearing on the records of the Plan Administrator
for such Employee, Participant, Beneficiary or other person.

     10.09 Multiple Capacities; Fiduciary Duties. Any person or group of persons
may serve in more than one  fiduciary  capacity  with respect to the Plan.  Each
Fiduciary shall discharge its duties with respect to the Plan:

          (a) solely in the interest of Participants and  Beneficiaries  and for
     the  exclusive  purpose  of  providing   benefits  to  them  and  defraying
     reasonable expenses of administering the Plan;

          (b)  with  the  care,   skill,   prudence  and  diligence   under  the
     circumstances  that a prudent person acting in a like capacity and familiar
     with  such  matters  would  use in the  conduct  of an  enterprise  of like
     character and with like aims; and

          (c) to the extent it has investment  authority,  by  diversifying  the
     investments of the Plan so as to minimize the risk of large losses,  unless
     under the circumstances it is clearly prudent not to do so; and

          (d) in accordance  with the documents  and  instruments  governing the
     Plan insofar as such  documents and  instruments  are  consistent  with the
     provisions of ERISA.
<PAGE>

     10.10 Reliance; Fiduciary Liability;  Exoneration.  Each Fiduciary shall be
entitled  to  conclusively  rely  upon  all  tables,  valuations,  certificates,
opinions  and  reports  which shall be  furnished  by any  accountant,  actuary,
auditor,  counsel,  insurance  company or other  expert who shall be employed or
engaged by the Company, the Retirement Committee or the Investment Committee. No
Fiduciary shall be liable:

          (a) for its own act,  or  failure  to act,  except  as it has  thereby
     occasioned  actual  loss to the Plan or a  Participant  or  Beneficiary  by
     failing properly to discharge a duty or  responsibility  expressly  imposed
     upon it by the Plan or by law;

          (b) for the act, or failure to act, of another  Fiduciary  of the Plan
     except  as it may  commit  one or more  of the  following  breaches  of its
     fiduciary responsibilities--

               (1) if it knowingly  participates  in or knowingly  undertakes to
          conceal an act or omission of another  Fiduciary,  knowing such act or
          omission is a breach,

               (2) if, by its  failure to observe  applicable  standards  in the
          administration of its specific responsibilities which give rise to its
          status as a Fiduciary, it has enabled such other Fiduciary to commit a
          breach, or

               (3)  if it  has  actual  knowledge  of a  breach  by  such  other
          Fiduciary,  unless it makes reasonable efforts under the circumstances
          to remedy the breach.

Subject to the foregoing and the provisions of ERISA, in the absence of fraud or
bad faith, no Fiduciary shall incur or suffer any liability or responsibility to
the  Company,   the  Trustee,   any  Committee  or  any   Participant  or  their
Beneficiaries, heirs, administrators,  executors and assigns, or to anyone else,
as the  result of the  exercise  or  non-exercise  of any  power  vested in such
Fiduciary under the Plan, nor, without limiting the generality of the foregoing,
as a result  of any  investment  made or  continued  in the  discretion  of such
Fiduciary.
<PAGE>

     10.11  Indemnification  of Fiduciaries.  To the maximum extent permitted by
law, no member or officer of the Pension,  Investment  or Review  Committees  or
officer, employee, or director of the Company to whom any duty or power relating
to the  administration  or  interpretation  of the Plan or to the management and
control  of the  assets  of the  Plan may be  delegated  or  allocated  shall be
personally  liable by reason of any contract or other instrument  executed by or
on behalf of such individual in such individual's capacity as a Fiduciary of the
Plan or for any action  taken or omitted  or  mistake of  judgment  made in good
faith, and the Company shall indemnify and hold harmless,  directly from its own
assets (including the proceeds of any insurance policy the premiums of which are
paid from the  Company's  own  assets)  against  any cost or expense  (including
counsel fees) or liability (including any sum paid in settlement of a claim with
the  approval  of the  Company)  arising  out of any act or  omission  to act in
connection  with the Plan unless arising out of such  individual's  fraud or bad
faith.

     10.12  Bonding.  Except as  otherwise  required by ERISA,  no bond or other
security need be required of any Fiduciary of the Plan in any jurisdiction.  The
Plan  Administrator  shall be responsible to assure that every  Fiduciary of the
Plan and  official  of the Plan,  as defined in Section  412 of ERISA,  shall be
bonded in the manner and to the extent  required by said Section 412. The amount
of any required bond  generally  shall not be less than ten percent (10%) of the
amount of funds  handled,  provided that in no case shall such bond be less than
One  Thousand  Dollars  ($1,000)  or more than  Five  Hundred  Thousand  Dollars
($500,000)  unless the Secretary of Labor shall properly  prescribe an amount in
excess of Five Hundred Thousand Dollars ($500,000).

     10.13 Voting of Company Stock.  Each  Participant and Beneficiary is hereby
designated as a named fiduciary within the meaning of Section 402(a)(2) of ERISA
with respect to the shares of Company Stock allocated to his Account.

          (a) Generally.  When the Company files preliminary proxy  solicitation
     materials with the Securities  and Exchange  Commission,  the Company shall
     cause a copy of all materials to be sent simultaneously to the Trustee, and
     the  Trustee  shall  prepare a voting  instruction  form  based  upon these
     materials.  At the time of  mailing  of  notice of each  annual or  special
     stockholders' meeting of the Company, the Company shall cause a copy of the
     notice  and all  proxy  solicitation  materials  to be  sent  to each  Plan
     Participant  and  Beneficiary,  together  with a  voting  instruction  form
     requesting  instructions  to the Trustee on how to vote the  Company  Stock
     allocated to such Participant's or Beneficiary's  Account. Each Participant
     and Beneficiary shall have the right to direct the Trustee as to the manner
     in which to vote that  number of shares of Company  Stock  credited  to his
     Accounts. Such direction shall be communicated in writing and shall be held
     in  confidence  by the Trustee  and not  divulged  to the  Company,  or any
     officer or employee thereof. Upon receipt of directions,  the Trustee shall
     vote  the  shares  of  Company  Stock  credited  to  the  Participant's  or
     Beneficiary's Accounts as so directed.

          The Trustee  shall vote those shares of Company  Stock not credited to
     Plan Participants' or Beneficiaries'  Accounts, and those shares of Company
     Stock credited to the Accounts of Participants and  Beneficiaries for which
     no valid voting  directions  are received,  in the same  proportion on each
     issue as it votes those shares credited to Participants' and Beneficiaries'
     Account for which it received  voting  directions.  The voting  instruction
     form  prepared  by  the  Trustee  shall  state  clearly,  and  in a  manner
     calculated  to  be  understood  by  Participants  and  Beneficiaries,  this
     provision  concerning the voting of unallocated shares of Company Stock and
     shares for which no valid voting  direction is received
<PAGE>

          (b) Tender Offers. Upon commencement of a tender offer for any Company
     Stock,  or any  exchange  offer or offer to  purchase  Company  Stock  each
     Participant  and  Beneficiary  shall  have the right to  determine  whether
     shares  allocated to their  Accounts will be tendered or sold.  The Company
     shall  notify  each Plan  Participant  and  Beneficiary  of this  right and
     distribute,  or cause to be distributed to them in a timely manner the same
     information  that is distributed to other  shareholders  in connection with
     the  proposed  tender  offer,  exchange  or  sale,  together  with a voting
     instruction  form.  Directions  from a Participant  or  Beneficiary  to the
     Trustee   concerning   the  tender  or  sale  of  Company  Stock  shall  be
     communicated in writing, and the Trustee shall tender or sell, or otherwise
     dispose  of  the  Company   Stock   allocated  to  the   Participant's   or
     Beneficiary's  Account as directed. To the extent that Plan Participants or
     Beneficiaries  do not  issue  valid  directions  to the  Trustee  to  sell,
     exchange or  otherwise  dispose of the  Company  Stock  allocated  to their
     Accounts such individuals shall be deemed to have directed the Trustee that
     such shares remain invested in Company Stock.

     With respect to unallocated  shares of Company  Stock,  if any, the Trustee
shall  tender  that  number of  shares of  Company  Stock not  credited  to Plan
Participants' and  Beneficiaries'  accounts  determined by multiplying the total
number of such shares by a  fraction,  of which the  numerator  is the number of
shares of Company Stock credited to Participants'  and  Beneficiaries'  Accounts
for which the Trustee has received  valid voting  directions  to tender,  and of
which the denominator is the total number of shares of Company Stock credited to
Plan Participants' and Beneficiaries' Account.

     The voting instruction form shall state clearly, and in a manner calculated
to  be  understood  by  Participants  and  Beneficiaries,   the  effect  of  the
Participant or Beneficiary failing to issue valid voting  instructions,  and the
manner in which unallocated shares of Company Stock will be voted.

          (c)  The  Plan  Administrator   shall  adopt  procedures  designed  to
     safeguard  the  confidentiality  of  information  relating to the purchase,
     holding,  and sale of  securities,  and the exercise of voting,  tender and
     similar  rights  with  respect  to such  securities  by  Participants  (and
     Beneficiaries),  except to the extent necessary to comply with Federal laws
     or state laws not preempted by ERISA.

          (d) The Secretary of the Company is hereby designated as the fiduciary
     of the Plan for the  purpose of  ensuring,  with  respect to the  purchase,
     holding and sale of securities,  that the procedures are in fact sufficient
     to safeguard the  confidentiality  of such  information and such procedures
     are being followed.  The Secretary of the Company is also hereby designated
     as  the  fiduciary  of the  Plan  for  the  purpose  of  ensuring  that  an
     independent  fiduciary is appointed who shall carry out activities relating
     to any situations  which the Secretary  determines  involve a potential for
     undue  influence upon  Participants  and  Beneficiaries  with regard to the
     direct or indirect  exercise of  shareholder  rights.  For  purposes of the
     preceding  sentence,  a fiduciary is not  independent  if the  fiduciary is
     affiliated with any sponsor of the Plan.
<PAGE>

                                   ARTICLE XI
                             PARTICIPATING EMPLOYERS
                             -----------------------

     11.01 Application of Plan to Participating  Employers.  The term Company as
used in other Articles hereof, shall refer to a participating Employer in regard
to its own  participation in the Plan. The term Company in this Article XI shall
refer  solely to its defined  meaning in the Glossary of the Plan. A list of the
Company  and  all  other  Participating  Employers  showing  the  dates  of each
Employer's participation in the Plan shall be attached as Exhibit A to this plan
document and shall be kept up to date by the Plan Administrator.

     11.02  Adoption  of Plan.  With the  consent of the  Company,  any  Related
Employer  or other  employer  may adopt  and  maintain  this  Plan and  become a
Participating Employer hereunder by appropriate action of its board of directors
or other governing body. An Employer may separately adopt this Plan with respect
to different divisions or other reasonable  classifications of its employees and
may vary the optional  provisions  of the Plan  (including  without  limitation,
eligibility,  vesting or contribution provisions) as they relate to the separate
divisions or classifications,  provided, however, that such action shall only be
permitted  with the  consent of the  Company and then only as long as and to the
extent that it does not adversely  affect the qualified status of the Plan under
the Code.

     11.03 Extent of  Participation.  The participation of each Employer in this
Plan shall be limited to  providing  benefits for  Participants  who are or have
been in the  employ of such  Employer.  Contributions  by an  Employer  shall be
determined  on the  basis  of  Participants  who  have  been  employed  by  that
particular Employer.  The Plan shall be administered as a single plan and not as
separate plans of the Company and each Employer.  Accordingly,  unless otherwise
directed by the Company, all funds shall be commingled, held and invested as one
fund.  All  contributions  made by the Company and by Employers  under the Plan,
together with any increment  attributable thereto, shall be used to pay benefits
to a Participant  under the Plan in accordance  with the  provisions of the Plan
and without regard to which participating  Employer or Employers have funded the
Participant's benefits. Forfeitures for a Plan Year shall be allocated among all
Participants who would be eligible to share in any  discretionary  contributions
made by their Employer for the Plan Year,  whether or not any such discretionary
contributions are made.

     11.04  Transfer of Employees  Among  Employers.  It is  anticipated  that a
Participant may be transferred  between and among the Company and  Participating
Employers, and in the event of any such transfer, the Participant involved shall
not have his rights under the Plan adversely affected,  but shall continue to be
credited with his  accumulated  Service for purposes of determining  eligibility
and vesting under the Plan.
<PAGE>

     11.05  Plan  Administration  and  Expenses.  The  Company  or its  Board of
Directors  shall  have  authority  to appoint a Trustee  from time to time,  the
Retirement Plan, Investment and Review Committees and the Plan Administrator and
any successors  thereto.  The Plan Administrator may delegate some or all of its
duties as they relate to an Employer's participation in the Plan to the Employer
or a committee  appointed  by the Employer to serve as plan  administrator  with
respect to the Employer's participation in the Plan; provided, however, that any
individual so appointed shall serve without  compensation from the Plan for such
services. By its adoption of this Plan a participating  Employer shall be deemed
thereby to appoint the  Company,  the  Retirement  Plan,  Investment  and Review
Committees,  the Plan Administrator,  the Trustee and other named Fiduciaries of
the Plan its  exclusive  agents to  exercise  on its behalf all of the power and
authority  conferred upon them by the Plan,  said  appointment to continue until
the  Plan  is  terminated  as to  such  Employer  and the  portion  of the  Fund
attributable  to the then  Employees of such  Employer  has been  disposed of as
provided in Section 11.07 hereof.  The Company,  or with its approval,  the Plan
Administrator, shall have authority to make any and all necessary or appropriate
rules and regulations, binding upon all persons, including Employers, Employees,
Participants and their Beneficiaries, relating to the participation of more than
one Employer in the Plan. Upon request of the Company or the Plan  Administrator
each  Employer  shall pay a  proportionate  part of the cost of any necessary or
appropriate   expenses   incurred  in  respect  of  the  Plan.   An   Employer's
proportionate  part  of  any  cost  shall  be  determined  on the  basis  of its
proportionate  share of  contributions  to the Fund for the Plan Year unless the
Company  or the  Plan  Administrator,  from  time to time  or  with  respect  to
particular  expenses,  determines  that another  reasonable  basis of allocation
shall apply.

     11.06 Plan Amendment. The Company may amend the Plan as provided in Section
9.01 hereof with respect to any Employer and such  Employer's  Employees as well
as with respect to itself and its Employees,  provided that any Employer  within
thirty  (30) days of notice  of an  amendment  affecting  such  Employer  or its
Employees may make written objection to the Company  concerning the same and, if
the matter is not satisfactorily resolved within a further period of thirty (30)
days,  such  objecting  Employer may  voluntarily  withdraw  from the Plan under
Section  11.07  hereof  within ten (10) days of the  expiration  of such  second
thirty (30) day period without the amendment in question  becoming  effective as
to  such  Employer  or its  Employees.  If such  timely  written  objection  and
voluntary withdrawal is not made by an Employer, the amendment in question shall
be  applicable  according  to its terms.  With the consent of the  Company,  any
Employer may amend the Plan as it applies to itself and its  Employees,  but any
such  amendment  shall not apply to the Company or to other  Employers  or their
Employees  unless with the consent of the Company  such  amendment is adopted by
them.  If an Employer or  Employers  purport to adopt an  amendment  to the Plan
which is not consented to by the Company,  such amendment shall not be effective
and the Company may at its option require such adopting Employer or Employers to
terminate their  participation  in this Plan pursuant to Section 11.07 hereof or
may take whatever  alternative  action it determines to be appropriate under the
circumstances.
<PAGE>

     11.07  Termination of an Employer's  Participation.  Without  affecting the
continuing  participation in the Plan of the Company or any other Employer,  the
Company,  with or without cause, may terminate the participation of any Employer
in the Plan by written notice to the Employer,  and any Employer may voluntarily
terminate its participation in the Plan by written notice to the Company. If any
Employer ceases to be a party to this Plan, the Plan  Administrator  shall cause
to be determined  that fraction of the Fund  allocable to the then  Employees of
the terminating  Employer.  Within a reasonable period of time the Trustee shall
set aside sufficient assets from the Fund to equal in value such fraction of the
entire value of the Fund. The Plan  Administrator  may direct the Trustee to (a)
distribute  such  assets  as if the Plan had been  terminated  on the date  such
former  Employer  ceased to be a party to this Plan,  (b) deliver such assets to
another plan trustee  designated by such former  Employer,  or (c) take whatever
alternative action may be deemed appropriate under the circumstances.

     11.08 Restrictions on Amendments, Mergers or Terminations by Employers. Any
amendment,  merger,  consolidation,  transfer of assets,  termination or partial
termination of or with respect to the  participation  in the Plan of an Employer
shall be subject to the same restrictions that apply to such actions on the part
of the Company as set forth in Article IX hereof.
<PAGE>

                                   ARTICLE XII
                            MISCELLANEOUS PROVISIONS
                            ------------------------

     12.01 Plan for Exclusive  Benefit of Employees.  This Plan has been entered
into  for  the   exclusive   benefit  of  Employees,   Participants   and  their
Beneficiaries. Except as expressly permitted under the provisions of the Plan or
as may  otherwise be permitted or required by law, no funds of the Plan shall at
any time  revert to or be used or enjoyed by the Company or  otherwise  than for
the  benefit  of  Employees  and  their  Beneficiaries  or to pay  taxes or Plan
administrative expenses.

     12.02  Rights of  Participants  Not  Expanded.  Neither  the Plan,  nor any
provisions   thereof,   nor  the  action  of  the  Company  in  establishing  or
participating  in the  Plan,  nor any  action  taken  or done by the  Retirement
Committee,  the Trustee or other Fiduciary of the Plan, nor participation in the
Plan shall be  construed  as giving to any person the right to be employed by or
to remain in the  employ of the  Company  or,  except to the  extent  and in the
manner  provided for in and subject to all the terms and conditions of the Plan,
the right to any payment or benefit  whatsoever.  All Employees shall be subject
to  discharge  to the same extent as if this Plan had never been adopted and the
Company hereby  expressly  reserves such right to discharge any Employee without
liability  on the  part of it,  the Plan  Administrator,  the  Trustee  or other
Fiduciary of the Plan.

     12.03 Plan Subject to Insurance  Contracts  and Trusts.  To the extent that
payment of any benefit under the Plan is provided for by an annuity  contract or
any other  contract with an insurance  company the payment of such benefit shall
be  subject  to all the  provisions  of such  contract.  In the  event  that the
Employer  establishes  a Trust,  any and all rights or benefits  accruing to any
persons under the Plan shall be subject to the terms of such trust agreement.

     12.04  Governing  Law and Savings  Clause.  To the extent not  preempted by
federal law,  the Plan shall be construed  according to the laws of the State of
Connecticut.  If any  provision  herein is held invalid or  unenforceable,  such
invalidity or  unenforceability  shall not affect any other provisions,  and the
Plan shall be construed and enforced as if such provision had not been included.
<PAGE>

     12.05 Headings.  The Article and Section  headings in the Plan are inserted
for  convenience  of  reference  only  and  are  not  to be  considered  in  the
construction or interpretation of the provisions of the Plan.

     12.06 Gender and Number.  As used in the Plan and unless otherwise  plainly
required by the context, any gender may be construed to include all genders, and
the  singular  or plural  may be  construed  to include  the plural or  singular
respectively.

     12.07  Definitions.  Unless otherwise plainly required by the context,  the
capitalized words and phrases used in the Plan shall have the meanings set forth
in the following Glossary.


<PAGE>


                                GLOSSARY


     "Account Balance" shall mean the Participant's  share of the Fund from time
to time as shown by the records of the Plan  Administrator.  The Account Balance
shall include Company Matching  Contributions,  Company  contributions made as a
result of a Participant's Salary Reduction Agreement,  Additional  Discretionary
Company  Contributions,  if any,  Rollover  Contributions,  if any,  Transferred
Account Balances,  TRASOP Account Balances,  LGS Account Balances, and Voluntary
After-Tax Contribution Account Balances, if any. A Participant's Account Balance
shall  reflect  all  contributions  allocated  to his  Account as  adjusted  for
earnings and other  accretions to the Fund and  distributions,  losses and other
diminutions to the Fund.

     "Actual  Deferral  Percentage"  shall  mean,  with  respect  to a group  of
Participants,  the  average  of  the  ratios,  calculated  separately  for  each
Participant in the same group,  of the amount of Salary  Deferral  Contributions
allocated  under  the Plan  with  respect  to a Plan  Year  (plus  any  Matching
Contributions that are made subject to 401(k) restrictions) to the Participant's
Compensation  for the same Plan  Year.  Company  contributions  on behalf of any
Participant shall include:

          (1) any  Salary  Reduction  Contributions  made  pursuant  to a Salary
     Reduction   Agreement,   including  Excess  Salary   Reductions  of  Highly
     Compensated  Employees,  but  excluding  (a) Excess  Salary  Reductions  of
     Non-Highly  Compensated  Employees that arise solely from Salary  Reduction
     Contributions  under this Plan or any Plan of the  Company;  and (b) Salary
     Reductions that are taken into account in the Contributions Percentage test
     (provided  the ADP test is  satisfied  both with and without  exclusion  of
     these Salary Reductions); and

          (2)  at  the   election   of  the   Company,   Qualified   Nonelective
     Contributions and Qualified Matching Contributions.

For purposes of computing Actual Deferral Percentages,  an Employee who would be
a Participant but for the failure to make a Salary Reduction shall be treated as
a Participant on whose account no Salary Reduction Contributions are made.

     "Age" shall mean the age of a person at his last birthday.

     "Applicable Life  Expectancy"  shall mean the life expectancy (or joint and
last survivor  expectancy)  calculated using the attained Age of the Participant
(or   designated   Beneficiary)   as  of  the   Participant's   (or   designated
Beneficiary's)  birthday in the applicable calendar year reduced by one for each
calendar  year  which  has  elapsed  since the date  life  expectancy  was first
calculated.  If life  expectancy  is being  recalculated,  the  applicable  life
expectancy  shall be the life  expectancy  as so  recalculated.  The  applicable
calendar  year  shall  be the  first  Distribution  Calendar  Year,  and if life
expectancy is being recalculated such succeeding calendar year.

     "Average  Contribution  Percentage"  shall mean, with respect to a group of
Participants,  the  average,  expressed  as a  percentage,  of the  Contribution
Percentages of the Participants in each group.

     "Beneficiary"  or   "Beneficiaries"   shall  mean  the  person  or  persons
designated in accordance with the provisions of Section 6.04 hereof or otherwise
entitled under the Plan or as provided in Code Section 401(a)(9) and regulations
thereunder  to receive any  benefits to be paid under the Plan on account of, or
following, the death of a Participant.
<PAGE>


     "Board of Directors" shall mean the Board of Directors of the Company.

     "Break in Service"  shall mean a period of  Severance  from Service of five
years or more. Notwithstanding the foregoing, an Employee who terminates Service
to enter the military  service of the United States shall not suffer a Severance
from Service as of such date provided (i) such  Employee's  rights are protected
by federal law, and (ii) such Employee returns to employment with the Company or
a Related  Employer  within the period  required by law for  preservation of his
rights.  Under such circumstances,  an Employee shall receive credit for Service
for his entire  period of absence.  If the  Employee  does not return to Service
within the time prescribed by law, then the date he terminated  employment shall
be  his  Severance  from  Service  Date.  In  addition,  for  purposes  of  this
subsection,  an Employee  shall not suffer a Severance from Service for the Plan
Year,  or the  immediately  following  Plan Year,  during which such Employee is
absent from work by reason of (i) the  Employee's  pregnancy,  (ii) the birth of
the  Employee's  child,  (iii) the  placement  of a child with such  Employee in
connection with an adoption of such child by the Employee,  or (ii) for purposes
of caring  for a child for a period  beginning  immediately  following  birth or
placement;  provided  however,  that the  period  between  the first and  second
anniversaries  of the  Participant's  absence  shall  not be  either a Period of
Service or a Period of Severance from Service.

     "Code"  shall mean the  Internal  Revenue  Code of 1986,  as amended and in
force  from time to time,  or any  successor  or  substitute  provisions  of law
enacted from time to time.

     "Code Section 415 Compensation" shall, for purposes of applying the benefit
limitations of Article VII,  include a Participant's,  wages,  salaries and fees
received for personal  services  actually  rendered in the course of  employment
with the Company, to the extent that the amounts are includable in gross income,
but excluding the following:

          (1) Company contributions to a plan of deferred compensation which are
     not includable in the Employee's gross income for the taxable year in which
     contributed,  or Company  contributions under a simplified employee pension
     plan to the extent such  contributions  are deductible by the Employee,  or
     any distributions from a plan of deferred compensation;

          (2)  Amounts  realized  from the  exercise  of a  non-qualified  stock
     option,  or when restricted stock either becomes freely  transferable or is
     no longer subject to a substantial risk of forfeiture; and

          (3) Amounts realized from the sale, exchange,  or other disposition of
     stock acquired under a qualified stock option; and

          (4) other amounts which receive special tax benefits, or contributions
     by the Company  (whether or not pursuant to a salary  reduction  agreement)
     toward the  purchase  of an  annuity  described  in  Section  403(b) of the
     Internal Revenue Code.

For Limitation  Years  beginning on and after January 1, 1998,  Code Section 415
Compensation shall also include any elective deferral as defined in Code Section
402(g)(3) and any amount which is  contributed or deferred by the Company at the
election of the  Employee  and which is not  otherwise  includable  in the gross
income of the Employee by reason of Code  Sections  125 or 457.  For  Limitation
Years  beginning  prior to January  1, 1998,  such  elective  deferrals  are not
included in Code Section 415 Compensation.
<PAGE>


     "Company" shall mean Citizens  Communications  Company on and after May 18,
2000 (Citizens  Utilities Company prior to that date), and any successor thereto
which assumes the Plan or any predecessor  employer which  maintained this Plan.
As and to the extent provided in Article XI hereof,  Company may also refer to a
participating Employer as regards its own participation in the Plan.

     "Company  Stock" shall mean Citizens  Communications  Company  Common Stock
(Citizens Utilities Company Common Stock prior to May 18, 2000.)

     "Company Matching  Contribution Account Balance" shall mean that portion of
a Participant's  Account Balance attributable to Company matching  contributions
as adjusted to reflect their share of earnings and other  accretions to the Fund
and  distributions,  losses and other diminutions to the Fund. Amounts contained
in this  Account  Balance  shall  include  amounts  attributable  to (i) Company
Matching  Contributions made on and after July 1, 1993, which are required to be
invested in Company  Stock (the "New  Company  Match");  (ii)  Company  Matching
Contributions  made prior to July 1, 1993, which may be invested by Participants
and are not  required  to be invested in Company  Stock ("Old  Company  Match");
(iii)  Transferred  Account  Balances or Rollover  Account  Balances  containing
matching  contributions,  which  amounts are subject to  Participant  investment
direction and not required to be invested in Company  stock  ("Prior  Employer's
Match"); (iv) matching contributions previously made by the Company with respect
to certain  covered  Participants  as an  additional  matching  contribution  to
compensate  for the  elimination  of  certain  retiree  medical  benefits  ("New
Discretionary  Company  Match")  which  amounts  are  required to be invested in
Company Stock;  and (v) and  discretionary  matching  contributions  made by the
Company pursuant to collective bargaining.

     "Compensation"  (except for "Code Section 415  Compensation,"  above) shall
mean the base  compensation  paid to an Employee by the Company  with respect to
each Plan Year, plus overtime, shift differential and commissions, but excluding
all bonuses.  "Compensation" shall include compensation which the Employee could
have elected to receive in cash with respect to the applicable  period but which
was instead  contributed by the Company to an employee benefit plan under a Code
Section 401(k) or Code Section 125 arrangement,  but excluding any other amounts
contributed  to or the value of benefits  under this Plan or any other  deferred
compensation,  employee  benefit or fringe benefit  program or plan or any other
extraneous form of compensation.

     In  addition to other  applicable  limitations  set forth in the Plan,  and
notwithstanding  any other  provision  of the Plan to the  contrary,  the Annual
Compensation  of each Employee  taken into account under the Plan for Plan Years
beginning  on or after  January  1, 1989 and prior to  January 1, 1994 shall not
exceed  $200,000 (as indexed for cost of living  increases)  and, for Plan Years
beginning  on or after  January  1,  1994,  shall not exceed the OBRA '93 Annual
Compensation  limit.  The OBRA '93  Annual  Compensation  limit is  $150,000  as
adjusted by the  Commissioner  for increases in the cost of living in accordance
with Section 401(a)(17)(B) of the Internal Revenue Code ($170,000 for Plan Years
beginning on or after January 1, 2000). The cost-of-living  adjustment in effect
for a calendar year applies to any period,  not exceeding 12 months,  over which
compensation  is determined  (determination  period)  beginning in such calendar
year. If a determination  period consists of fewer than 12 months,  the OBRA '93
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.

     For Plan Years beginning on or after January 1, 1994, any reference in this
Plan to the limitation under Section  401(a)(17) of the Code shall mean the OBRA
'93 Annual Compensation limit set forth in this provision.
<PAGE>


     If compensation for any prior determination period is taken into account in
determining  an  Employees'  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.

     With respect to Plan Years  beginning prior to January 1, 1997, in applying
this  limit,  the  rules  of  Section  414(q)(6)  shall  apply,  except  that in
attributing  the  compensation  of Family Members to certain Highly  Compensated
Participants,   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 Plan Year. If, as a result of the  application of
such rules the limit is exceeded,  then the  limitation  shall be prorated among
the affected individuals in proportion to each such individual's Compensation as
determined under this section prior to the application of the limit.

     "Contribution   Percentage"   shall  mean,  with  respect  to  a  group  of
Participants,   the  ratios   (expressed  as  a  percentage)   of  the  Matching
Contributions (plus voluntary after-tax  contributions,  if any) allocated under
the Plan on behalf of each Eligible  Participant in the group, with respect to a
Plan Year, to the Participant's  Compensation for the Plan Year. For purposes of
determining  such  ratios,  "Eligible  Participant"  is  defined  below  in this
Glossary and is further defined to mean:

          (a) an  Employee  who is  directly  or  indirectly  eligible to make a
     Salary  Reduction  Contribution  or to receive an  allocation  of  Matching
     Contributions  (including Matching  Contributions derived from forfeitures)
     under the Plan for a Plan Year;

          (b) an Employee who is unable to make a Salary Reduction  Contribution
     or to receive an allocation of Matching  Contributions because the Employee
     has not contributed to another plan;

          (c) an  Employee  who  would  be  eligible  to make  Salary  Reduction
     Contributions  but for a  suspension  due to a  distribution,  a loan or an
     election  not to  participate  in the Plan  (other  than  certain  one-time
     elections),  even though the  Employee  may not make such Salary  Reduction
     Contributions or receive an allocation of Matching  Contributions by reason
     of such suspension; or

          (d) an Employee who is unable to make a Salary Reduction  Contribution
     or to receive an allocation of Matching Contributions because such Employee
     may receive no additional  annual additions because of Section 415(c)(1) or
     415(e) of the Code.

In the case of a Participant  described in paragraphs (a), (b), (c) or (d) above
who  makes  no  Salary   Reduction   Contributions   and  receives  no  Matching
Contributions  under the Plan for a Plan Year, the  Contribution  Percentage for
such Participant that is to be included in determining the Average  Contribution
Percentage  for such Plan Year shall be zero. In  determining  the  Contribution
Percentage,  the Plan  Administrator  may  elect,  to the  extent  permitted  in
regulations,  to take into account elective  deferrals  (defined in Code Section
402(g)(3)(A)  and  qualified  non-elective  deferrals  which are subject to Code
Section  401(k)   restrictions   (as  defined  in  Code  Section   401(m)(4)(C))
contributed to any Plan maintained by the Company or a Related Employer.

In determining the Contribution Percentage, the following Matching Contributions
shall be excluded:

          (i) Matching  Contributions  that a Participant  forfeits because they
     correspond to Salary  Reduction  Contributions in excess of the permissible
     dollar limits contained in Code Section 402(g);
<PAGE>

          (ii) Matching Contributions  forfeited, or returned to the Participant
     in order to correct an allocation in excess of Section  415(c) of the Code;
     and

          (iii)   Matching   Contributions   that  a  Participant   forfeits  in
     conjunction  with a distribution  made to correct a failure of the ADP, ACP
     or multiple use test.

For Plan Years  prior to  January  1, 1997,  for  purposes  of  determining  the
Contribution  Percentage of any Highly Compensated Employee who is a 5% owner or
one of the ten most Highly  Compensated  Employees during the Plan Year, Company
Matching  Contributions,  voluntary  after-tax  contributions,  if any,  and the
Compensation  of such Highly  Compensated  Employees  shall  include the Company
Matching  Contribution,  voluntary  after-tax  contributions and Compensation of
Family Members.

     "Current  Market  Value"  shall  mean on any day (1) as  applied to Company
Stock,  the  closing  market  price  thereof as  reported  on the New York Stock
Exchange or such other  exchange as the  Company's  Common Stock may be reported
on; and(2) as applied to other  investments in the Plan,  shall mean the closing
market price as of the Valuation Date, as reported by the Trustee.

     "Distribution Calendar Year" shall mean a calendar year for which a minimum
distribution is required.  For  distributions  beginning  before a Participant's
death,  the first  Distribution  Calendar Year is the calendar year  immediately
preceding the calendar year which contains the Participant's  Required Beginning
Date.  For  distributions  beginning  after a  Participant's  death,  the  first
Distribution  Calendar  Year is the  calendar  year in which  distributions  are
required to begin as provided in Section 6.01(c) and (d) hereof.

     "Effective  Date" for purposes of this Amended and Restated Plan shall mean
January 1, 1997. The Effective  Date of any prior Plan or amendment  shall be as
specified in each such prior document.

     "Eligible  Participant"  shall mean a  Participant  who has  satisfied  the
eligibility  requirements  of Article II and who is  therefore  eligible to make
salary reduction  contributions,  and to receive a Company Matching Contribution
whether or not the Participant actually makes Salary Reduction contributions.

     "Employee" shall mean any person, other than an independent contractor,  in
the  actual  employ of the  Company,  who  receives  therefor  a regular  stated
compensation, whether on an hourly or salaried basis.

     "Employer" shall mean any Related Employer or other employer  participating
in the  Plan as  provided  in  Article  XI  hereof.  Employer  may  refer to all
participating  Employers collectively or to each one individually as the context
may require.

     "ERISA" shall mean the Employee  Retirement  Income Security Act of 1974 as
amended  and in  force  from  time  to  time,  or any  successor  or  substitute
provisions of law enacted from time to time.

     "Excess Contributions" shall mean with respect to any Plan Year, the excess
of (a) the aggregate amount of Company contributions actually taken into account
in computing the Actual Deferral Percentage of Highly Compensated  Employees for
such Plan Year, over (b) 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.)
<PAGE>

     "Excess  Salary  Reductions"  shall mean those Salary  Reductions  that are
includable in a  Participant's  gross income under Section 402(g) of the Code to
the extent such  Participant's  Salary  Reductions  exceed the dollar limitation
under such Code section.

     "Family  Member" with respect to any Employee means the  Employee's  spouse
and lineal  ascendants and descendants and the spouses of such lineal ascendants
or descendants.

     "Fiduciary" shall mean any person who--

          (a) exercises any  discretionary  authority or  discretionary  control
     respecting  management  of the Plan or exercises  any  authority or control
     respecting management or disposition of its assets,

          (b) renders investment advice for a fee or other compensation,  direct
     or indirect,  with  respect to any monies or other  property of the Plan or
     has any authority or responsibility to do so, or

          (c) has any  discretionary  authority or discretionary  responsibility
     for the administration of the Plan.

     "Fund"  shall mean the cash,  securities  or other Plan  assets held by the
Trustee (or other funding agencies under the Plan) for the purposes of the Plan.

     "Hardship  Distribution"  shall mean a  distribution  necessary in light of
immediate  and heavy  financial  needs of the  Participant.  Such needs shall be
deemed to include tuition payments for post-secondary education and unreimbursed
major medical  expenses of the  Participant,  members of his immediate family or
his  dependents,  and major expenses  relating to the purchase of  Participant's
principal  residence  or to  prevent  eviction  from,  or  foreclosure  on,  the
Participant's principal residence.  Such needs shall be determined in accordance
with  uniform  and  nondiscriminatory  policies  and rules  approved by the Plan
Administrator  or its  designee in its  discretion  from time to time and on the
basis of written information furnished to the Plan Administrator or its designee
and represented to be true by the Participant.  The Plan Administrator  shall be
entitled  to  conclusively  rely  upon such  written  information,  without  the
necessity  of  independent  investigation,  unless  it has  reason  to doubt the
validity  of such  information  on the  basis of other  information  then in its
possession.

     "Highly Compensated  Employee" includes Highly Compensated Active Employees
and Highly  Compensated Former Employees.  For purposes of this definition,  the
determination  year  shall be the plan  year.  The  look-back  year shall be the
twelve-month period immediately preceding the determination year.

               For Plan Years  beginning  on or after  January 1, 1997, a Highly
          Compensated  Active  Employee  includes  any  Employee  who  (i) was a
          5-percent  owner  at any time  during  the  determination  year or the
          look-back year, or (ii) for the look-back year had  compensation  from
          the  Employer  in excess  of Eighty  Thousand  Dollars  ($80,000)  (as
          adjusted  pursuant to Section 415(d) of the Code) and, if the Employer
          so elects, was in the top-paid group.
<PAGE>

               For Plan Years  beginning  prior to  January  1,  1997,  a Highly
          Compensated Active Employee includes any Employee who performs service
          for the Employer  during the  determination  year and who,  during the
          look-back year (i) received  compensation  from the Employer in excess
          of Seventy-five  Thousand Dollars  ($75,000) (as adjusted  pursuant to
          Section  415(d) of the  Code);  (ii)  received  compensation  from the
          Employer in excess of Fifty  Thousand  Dollars  ($50,000) (as adjusted
          pursuant  to  Section  415(d)  of the  Code)  and was a member  of the
          top-paid  group for such year; or (iii) was an officer of the Employer
          and received compensation during such year that was greater than fifty
          percent  (50%)  of the  dollar  limitation  in  effect  under  Section
          415(b)(1)(A)  of the Code. The term Highly  Compensated  Employee also
          includes:  (iv) an employee  who is both  described  in the  preceding
          sentence if the term "determination  year" is substituted for the term
          "look-back  year"  and  one of the one  hundred  (100)  Employees  who
          received  the  most   compensation   from  the  Employer   during  the
          determination  year;  and (v) an Employee  who is a five  percent (5%)
          owner (as  defined  in Code  Section  416(i))  at any time  during the
          look-back year or determination  year. If no officer has satisfied the
          compensation   requirement   of   (iii),   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.  If an
          Employee is, during a  determination  year or look-back year, a Family
          Member of either a five  percent (5%) owner who is an active or former
          Employee or a Highly  Compensated  Employee who is one of the ten (10)
          most Highly Compensated  Employees ranked on the basis of compensation
          paid by the Employer  during such year, then the Family Member and the
          five percent owner (5%) or top-ten Highly  Compensated  Employee shall
          be  aggregated.  In such case, the Family Member and five percent (5%)
          owner or top ten (10) 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 five  percent (5%) owner or top-ten
          Highly  Compensated  Employee.  For  purpose of this  section,  Family
          Member includes the spouse,  lineal  ascendants and descendants of the
          Employee or former Employee and the spouses of such lineal  ascendants
          and  descendants.  The  determination  of who is a Highly  Compensated
          Employee,  including the  determinations of the number and identity of
          Employees in the top-paid group,  the top one hundred (100) Employees,
          the number of Employees  treated as officers and the compensation that
          is considered,  will be made in accordance  with Section 414(q) of the
          Code and the regulations thereunder.

A Highly  Compensated  Former Employee  includes 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  fifty-fifth  (55th)
birthday.

The  determination  of who  is a  Highly  Compensated  Employee,  including  the
determinations  of the number and identity of  Employees in the top-paid  group,
the  number of  Employees  treated as 5% owners,  and the  compensation  that is
considered,  will be made in accordance  with Section 414(q) of the Code and the
regulations thereunder.

     "Hour of Service" shall mean each hour for which:

          (a) An Employee is paid, or entitled to payment for the performance of
     duties for the Company or a Related Employer.

          (b) An  Employee  is paid,  or entitled to payment by the Company or a
     Related  Employer on account of a period of time during 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,  leave of absence or the
     like.

          (c) Back pay, irrespective of mitigation of damages, is either awarded
     or agreed to by the Company or a Related Employer.
<PAGE>

          (d)  Credit  is  required  under  applicable  state  or  federal  law,
     including  for periods of service in the Armed Forces of the United  States
     under the Military Selective Service Act as amended. The nature, extent and
     timing of such credit shall be as required under applicable law.

     An Hour of Service to be  credited  to an  Employee  in  connection  with a
period of no more than  thirty-one (31) days falling in two (2) Plan Years shall
be  credited  in the second  such  Year,  otherwise  Hours of  Service  shall be
credited in the Plan Year in which the duties are performed  under  Subparagraph
(a),  above,  in which occurs the period  during  which no duties are  performed
under  Subparagraph (b), above, and to which the award or agreement for back pay
pertains  under  Subparagraph  (c),  above.  Hours of Service  for  purposes  of
subparagraph  (b),  above,  will be calculated and credited  pursuant to Section
2530.200b-2 of the Department of Labor Regulations, which is incorporated herein
by this  reference.  The number of Hours of Service to be credited  under either
Subparagraph  (b) or (c) for periods  described in Subparagraph (b) shall be the
number of working hours regularly scheduled for such periods of time. In case of
an Employee  without a regular  work  schedule,  an average of his actual  hours
worked for comparable periods of time shall be credited.

     Notwithstanding  the  foregoing,  the same  Hour of  Service  shall  not be
credited under more than one of the foregoing  Subparagraphs and for purposes of
crediting  Hours of Service  under  either  Subparagraph  (b) or (c) for periods
described in Subparagraph (b):

               (i)  Except  in the case of an  authorized  leave of  absence  or
          required government service as described in the definition of Break in
          Service in this Glossary, no more than five hundred one (501) Hours of
          Service shall be credited to an Employee on account of any such single
          continuous  period (whether or not such period occurs in a single Plan
          Year) and such hours shall be credited until exhausted  beginning with
          the first day of such period; and

               (ii) No Hour of Service  shall be  credited  to an  Employee  for
          payments made or due under a plan maintained solely for the purpose of
          complying  with  applicable   workmen's   compensation,   unemployment
          compensation  or  disability  insurance or for  payments  which solely
          reimburse  the  Employee  for medical or  medically  related  expenses
          incurred by such Employee.

     Hours of Service will be credited for  employment  with other members of an
affiliated   service  group  under  Section  414(m),   a  controlled   group  of
corporations  under Section  414(b),  a group of trades or business under common
control under Section 414(c) of which the Company is a member,  and other entity
required to be aggregated  with the Company,  pursuant to Section 414(o) and the
regulations  thereunder.  Hours  of  Service  will  also  be  credited  for  any
individual considered an Employee for purposes of this Plan under Section 414(n)
of the Code.

     "Investment Committee" shall mean the committee appointed by the Retirement
Committee pursuant to Article X hereof to oversee the investment of Plan assets,
or if no such  committee is appointed or if there are no members in office,  the
Retirement Committee.

     "Key Employee" shall mean any employee or former employee of the Company or
of any Related  Employer  (and any  beneficiary  of such an employee) who at any
time  during the five (5) plan years  ending on the  determination  date for the
Plan Year in question (as defined under "Top-Heavy" in this Glossary) was:
<PAGE>

          (a) an officer of the  Company or of any Related  Employer,  provided,
     however,  that for plan  years  beginning  after  December  31,  1983  only
     officers having an Annual Compensation  greater than fifty percent (50%) of
     the dollar limitation in effect under Section  415(b)(1)(A) of the Code for
     the  calendar  year in which  the Plan  Year ends  shall be  included,  and
     further  provided that no more than fifty (50) persons (or, if lesser,  the
     greater of three (3) persons or ten percent  (10%) of the  employees of the
     Company and the Related Employers) shall be treated as officers;

          (b) one of the ten (10) employees  having Annual  Compensation of more
     than the dollar limitation in effect under Section 415(c)(1)(A) of the Code
     for the calendar year in which the Plan Year ends and owning (or considered
     as owning  within the  meaning of Section 318 of the Code) both more than a
     one-half  percentage (1/2%) interest and one of the ten largest  percentage
     interests in the Company and Related  Employers (if two employees  have the
     same  interest  in  an  employer,   the  employee   having  greater  annual
     compensation shall be treated as having a larger interest);

          (c) a person who,  without  application  of the  aggregation  rules of
     subsections  (b), (c) and (m) of Section 414(b) of the Code,  owned (or was
     considered  as owning  within the  meaning of Section 318 of the Code) more
     than  five  percent  (5%) of the  outstanding  stock  (or in the case of an
     unincorporated business, of the capital or profits interest) of the Company
     or Related  Employer or stock possessing more than five percent (5%) of the
     total  combined  voting power of all of the stock of the Company or Related
     Employer; or

          (d) a person  who had  Annual  Compensation  from the  Company  and/or
     Related   Employers  of  more  than  one  hundred  sixty  thousand  dollars
     ($160,000) (as indexed from time to time) and who,  without  application of
     the aggregation  rules of subsections (b), (c) and (m) of Section 414(b) of
     the Code,  owned (or was considered as owning within the meaning of Section
     318 of the Code) more than one percent (1%) of the outstanding stock (or in
     the case of an unincorporated business, of the capital or profits interest)
     of the  Company  or  Related  Employer  or stock  possessing  more than one
     percent (1%) of the total combined  voting power of all of the stock of the
     Company or Related Employer.

Annual  Compensation  means  compensation as defined in Section 415(c)(3) of the
Code,  including  amounts  contributed  by  the  Company  pursuant  to a  salary
reduction  agreement which are excludable from the Employee's gross income under
Section 125, Section 402(a)(8), Section 402(h) or Section 403(b) of the Code.

     "Leased  Employee"  shall mean 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  Section
414(n)(6)  of the Code) on a  substantially  full-time  basis for a period of at
least one year, and such services are performed under the primary  direction and
control of the recipient  employer.  Contributions or benefits provided a leased
employee  by  the  leasing  organization  which  are  attributable  to  services
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: (i)
such  employee is covered by a money  purchase  pension  plan  providing:  (1) a
nonintegrated  employer  contribution  rate of at  least  ten  percent  (10%) of
compensation, as defined in Section 415(c)(3) of the Code, but including amounts
contributed  pursuant to a salary reduction  agreement which are excludable from
the employee's gross income under Section 125, Section 402(a)(8), Section 402(h)
or Section  403(b) of the Code,  (2) immediate  participation,  and (3) full and
immediate vesting;  and (ii) leased employees do not constitute more than twenty
percent (20%) of the recipient's non-highly compensated workforce.
<PAGE>


     "LGS Account" shall mean the amount transferred to this Plan on behalf of a
Participant  as a consequence  of the merger of the LGS  Employee's  Savings and
Investment Plan, as adjusted for subsequent  investment gain or loss, income and
expense. A Participant shall at all times be fully vested in his LGS Account.

     "Limitation Year" shall mean the Plan Year.

     "Non-Highly  Compensated  Employee"  shall  mean  any  employee  or  former
employee of the Company or a Related  Employer  who is not a Highly  Compensated
Employee.

     "Non-Key  Employee"  shall  mean any  employee  or former  employee  of the
Company or of any Related Employer (and any beneficiary of such an employee) who
is not a Key Employee.

     "Normal Retirement Date" shall mean the date on which a Participant attains
his  normal  retirement  age as  specified  in the  applicable  Appendix  to the
Citizens Pension Plan.

     "Participant"  shall mean an Employee or former  Employee  who has become a
Participant in the Plan in accordance  with Article II hereof and whose interest
under the Plan has not been fully distributed or terminated.

     "Period of Service" shall mean the period of time commencing on the date on
which an Employee first is credited with an Hour of Service (or his reemployment
commencement date, if later) and ending on his next Severance from Service Date.
If an  Employee  has a  Severance  from  Service  as the  result of a  voluntary
termination,  discharge or retirement and returns to service within 12 months of
his Severance from Service, such period of absence shall be counted for purposes
of determining such Employee's  vesting.  If, during an absence from service for
any reason  other than a voluntary  termination,  discharge  or  retirement,  an
Employee  incurs  a  Severance  from  Service  as  the  result  of  a  voluntary
termination, discharge or retirement, and the Employee returns to service within
12 months of the date on which he was first  absence  from  service,  the period
during  which he is  absent  from  service  shall be  counted  for  purposes  of
determining his vesting under the Plan.

     (a) For purposes of determining a Participant's  vesting under Section 5.09
of the Plan,  a  Participant  shall  receive  credit for all Periods of Service,
including  Service  credited to the Employee prior to the Company's  adoption of
the Plan; provided, however, that:

          (1) if a  Participant  has a five year Break in Service,  then Service
     credited to the  Participant  prior to the five year Break in Service shall
     not be taken into account for  purposes of  determining  the  Participant's
     vesting in his Account Balance accrued before such Break in Service; and

          (2) if the  Participant  has no vested right to his Account Balance as
     of his Severance  from Service,  then no Period of Service  credited to him
     prior to his  Severance  shall be taken  into  account if the number of his
     consecutive  one year  Breaks in Service  exceeds  the  greater of (i) five
     years or (ii) the number of Years of Service he had immediately  before his
     Break.
<PAGE>

     (b) For purposes of determining an Employee's  eligibility to  participate,
and  determining  the vesting  percentage  under  Section  5.09 with  respect to
transferred  Employees of GASCO,  Inc. and Ogden Telephone Company (as that term
is defined in the respective  purchase  agreements for such companies),  service
recognized  under the BHP Retirement  Savings Plan and GASCO  Bargaining  401(k)
Plan  shall be  treated as Service  under  this  Plan,  and  service  with Ogden
Telephone  Company shall be recognized as service under this Plan.  For purposes
of  determining  an  Employee's  eligibility  to  participate  and  the  vesting
percentage  under  Section  5.09  with  respect  to  Transferred   Employees  of
Rhinelander  Telephone  Company,  GTE, Alltel, and LGS, service credited to such
Transferred  Employees by such former  employers  shall be recognized as service
under this Plan. If and to the extent that the Board of Directors of the Company
so determines by rules uniformly applicable to all Employees similarly situated,
an Employee  who was in the employ of any business or  enterprise  substantially
all of whose  assets  and  property  are  acquired  by the  Company or a Related
Employer by purchase, merger, consolidation or otherwise, may receive credit for
his past service with such  business or  enterprise,  and such service  shall be
included in his Period of Service under this Plan.

     "Period of Severance" or "Separation from Service" shall mean the period of
time commencing on an individual's Severance from Service and ending on the date
on which he again performs an Hour of Service.

     "Permanently Disabled" shall mean that a Participant has become disabled to
such extent that he has  qualified  for and is  receiving  long-term  disability
benefits  from the  Company.  Determinations  of Permanent  Disability,  and the
continued  existence  thereof,  shall  be made by the  Plan  Administrator  upon
competent medical evidence,  including the opinion of a licensed physician, in a
uniform and nondiscriminatory manner.

     "Plan"  shall  mean  Citizens  401(k)  Savings  Plan,  including  this plan
document  and any other  agreement  or Trust  Agreement  forming a part  hereof,
together with any and all amendments or supplements thereto.

     "Plan  Administrator"  shall mean the  Retirement  Committee or, if no such
committee is appointed, the Company

     "Plan Year" shall mean a twelve (12) month period running from the first of
January through the end of the following December.

     "Related Employer" shall mean a corporation or other business  organization
during the period it is--

          (a) a member with the Company of a controlled group of corporations,

          (b) a member with the Company of a group of trades or businesses under
     common control,

          (c) a member with the Company of an affiliated  service group,  all as
     determined  pursuant  to  Sections  414(b),  (c)  and (m) of the  Code,  as
     applicable, or

          (d) any  other  entity  required  to be  aggregated  with the  Company
     pursuant to regulations under Section 414(o) of the Code.

     "Required  Beginning  Date"  April 1 of the  calendar  year  following  the
calendar year in which the Participant attains 70 1/2, provided,  however,  that
any  Participant,  other than a 5% owner,  attaining  age seventy  and  one-half
(70-1/2)  in years  after  1995 may  elect by  April  1st of the  calendar  year
following  the year in which the  Participant  attained age seventy and one-half
(70-1/2) to defer  distributions  until the calendar year following the calendar
year in  which  the  Participant  retires.  If no such  election  is  made,  the
Participant will begin receiving  distributions by the April 1st of the calendar
year following the calendar year in which the  Participant  attained age seventy
and one-half (70-1/2).
<PAGE>


     "Retirement  Committee"  shall  mean  the  committee  provided  for  by the
provisions of Article X hereof to administer  the Plan, or if no such  committee
is appointed or there are no members in office, the Company.

     "Review  Committee"  shall  mean the  committee  appointed  by the Board of
Directors of the Company  pursuant to Section  6.09 hereof to review  denials of
benefit claims.

     "Rollover  Account  Balances"  shall mean those  balances  attributable  to
amounts  rolled  from  another  qualified  retirement  plan to this Plan,  which
amounts shall be fully vested and subject to the distribution provisions of this
Plan. Rollover Account Balances include, without limitation, amounts rolled from
the BHP Retirement Savings Plan with respect to non-union GASCO Employees,  from
the terminated Ogden Telephone Company Tax Deferred  Retirement Savings Plan and
Trust, from the terminated  Rhinelander  Telephone Company 401(k) Profit Sharing
Plan & Trust,  and any other rollover  amounts accepted from time to time by the
Plan Administrator.

     "Salary  Reduction" shall mean any employer  contributions made to the plan
at the election of the participant, in lieu of unreduced compensation, and shall
include  contributions  made pursuant to a salary  reduction  agreement or other
deferral  mechanism.  With respect to any taxable year, a  participant's  Salary
Reduction  is the  sum of all  employer  contributions  made on  behalf  of such
participant  pursuant  to an  election  to defer  under  any  qualified  CODA as
described in section 401(k) of the Code.

     "Salary   Reduction   Account   Balance"  shall  mean  that  portion  of  a
Participant's   Account  Balance  attributable  to  salary  deferral  or  Salary
Reduction Contributions as adjusted to reflect their share of earnings and other
accretions to the Fund and  distributions,  losses and other  diminutions to the
Fund.

     "Severance  from  Service  Date" shall mean the earlier of (a) the date the
employee quits, is discharged, retires or dies, and (b) the first anniversary of
the first date of a period in which the employee remains absent from service for
any other  reason.  Notwithstanding  the  foregoing,  if the  employee  has been
granted a leave of absence or layoff and the date of  termination  of such leave
or layoff occurs after the first  anniversary  of his absence from service under
clause (b) above, such termination date will be the Severance from Service Date.

     In the event  that an  employee  is absent  from  service  beyond the first
anniversary of the first date of absence  occurring as a result of the pregnancy
of the employee,  the birth of a child of the employee, the placement of a child
with the employee by reason of adoption or for purposes of caring for a child of
the employee  immediately  following the child's birth or adoption,  a Severance
from Service Date shall not occur until the second anniversary of the separation
from service.  The period between the first and second  anniversary of the first
date of such absence from service  shall not count either as a Period of Service
or Period of Severance.

     "Super Top-Heavy" shall be determined in the same manner and shall mean the
same as  Top-Heavy,  except that the present  value of accrued  benefits for Key
Employees  must exceed  ninety  percent  (90%) of the accrued  benefits  for all
Employees, rather than sixty percent (60%) as in the case of Top-Heavy.

     "Top-Heavy" shall mean that, as of the determination date with respect to a
Plan Year--

          (a)  if  the  Plan  is  not  included  in  a  required  or  permissive
     aggregation  group,  the  present  value of the  accrued  benefits  for Key
     Employees  under the Plan exceeds  sixty percent (60%) of the present value
     of the accrued benefits for both Key and Non-Key  Employees under the Plan,
     or
<PAGE>

          (b) if the Plan is included in a required  or  permissive  aggregation
     group,  the sum of the present value of accrued  benefits for Key Employees
     under all defined benefit plans and all defined contribution plans included
     in such group  exceeds  sixty percent (60%) of the sum of the present value
     of accrued benefits for both Key and Non-Key Employees.

     For purposes of making the above Top-Heavy determination:

               (1) The  determination  date for a given  plan year  shall be the
          last day of the preceding plan year, or, in the case of the first plan
          year of a plan, the last day of such first plan year.

               (2) A required  aggregation  group consists of: (A) the Plan; and
          (B) other  qualified  plans  required to be  aggregated  with the Plan
          under Section 416(g) of the Code in testing for  top-heaviness,  i.e.,
          (i)  each   qualified   plan  in  which  at  least  one  Key  Employee
          participates at any time during the determination  period  (regardless
          of whether plan has  terminated),  and (ii) any other  qualified  plan
          which enables the Plan or a plan described in (B)(i) above to meet the
          requirements of Sections 401(a)(4) and 410 of the Code.

               (3) A permissive aggregation group consists of: (A) the Plan; (B)
          any plans required to be aggregated  with the Plan under (2)(B) above;
          and (C) any other  qualified plans permitted to be aggregated with the
          Plan under  Section  416(g) of the Code in testing for  top-heaviness,
          i.e., any other such plan which,  when  considered as a group with the
          Plan,  and any plans  required  to be  aggregated  with the Plan under
          (2)(B) above,  continue to meet the requirements of Sections 401(a)(4)
          and  410  of  the  Code,  and  which  the  Plan  Administrator  in its
          discretion chooses to include in the group.

               (4) Where more than one plan is  involved  in the  determination,
          the present value of accrued benefits  (including  distributions to be
          included  therein in  accordance  with (10) below) shall be determined
          separately for each plan as of its own  determination  date falling in
          the same calendar year as the Plan's  determination  date with respect
          to the  Plan  Year in  question,  and  the  results  of such  separate
          determination shall then be aggregated as provided above.

               (5) The  present  value of  accrued  benefits  under a plan shall
          include  the  present  value  of  accrued  benefits  derived  from all
          contributions,  including  employer and employee  (both  voluntary and
          mandatory)  contributions,  except for the present  value derived from
          tax deductible  employee  contributions  which shall not be taken into
          account.

               (6) The present value of accrued  benefits  under a plan shall be
          determined  as of the plan's  most  recent  valuation  date that falls
          within the twelve (12) month period ending on the plan's determination
          date. The Plan's valuation date is on December 31.

               (7) The present value of a participant's accrued benefits under a
          defined  contribution  plan  shall  be the  sum  of the  participant's
          account balance as of the relevant  valuation date, plus an adjustment
          for contributions  due as of the determination  date. In the case of a
          plan not subject to the minimum  funding  requirements of Code Section
          412, the adjustment is the amount of  contributions,  if any, actually
          made after the valuation date but on or before the determination date,
          except in the first plan year of the plan when the  adjustment  should
          also reflect the amount of any contributions  whenever made that would
          be allocated as of a date not later than the  determination  date.  In
          the case of a plan subject to the minimum funding requirements of Code
          Section 412, the  adjustment is the amount of  contributions  whenever
          made  that  would  be  allocated  as of a  date  not  later  than  the
          determination date.
<PAGE>

               (8) The present value of a participant's accrued benefits under a
          defined  benefit  plan shall be based  upon  reasonable  interest  and
          mortality  assumptions specified by the plan. The accrued benefit of a
          Participant  (who is not a Key Employee)  under a defined benefit plan
          shall be  determined  under (i) the  method,  if any,  that  uniformly
          applies  for  accrual   purposes  under  all  defined   benefit  plans
          maintained by the Company,  or (ii) if no such uniform  method exists,
          then the slowest accrual method permitted under the fractional rule of
          Section 411(b)(1)(C) of the Code.

               (9) The  accrued  benefit  of a  participant  in a plan  who is a
          Non-Key  Employee  but who was a Key Employee in a prior year shall be
          disregarded.

               (10) Generally, any accrued benefit transferred or distributed in
          the five (5) year period ending on a plan's determination date (except
          any such accrued  benefit  otherwise  included in the present value of
          accrued  benefits on the  determination  date) shall be added back and
          included  in the plan's  present  value of accrued  benefits as of the
          determination  date.  This rule shall apply to  distributions  under a
          terminated plan which, if it had not been terminated,  would have been
          required to be included in an aggregation  group.  It shall also apply
          to any  unrelated  rollover or transfer  (i.e.  one  initiated  by the
          employee and made to a plan maintained by another,  unrelated employer
          under  Code  Section  414(b),  (c) or  (m)).  The  plan  accepting  an
          unrelated  rollover or transfer  shall not  consider  the  rollover or
          transfer as part of its present value of accrued  benefits  unless the
          rollover or transfer was accepted  prior to December 31, 1983.  ln the
          case of a related  rollover or transfer (i.e. one not initiated by the
          employee or made to a plan maintained by the same or related  employer
          under Code Section 414(b), (c) or (m)), the rollover or transfer shall
          not be added  back but  shall be  counted  in the plan  accepting  the
          rollover or transfer  whether the  rollover or transfer  was  accepted
          before or after December 31, 1983.

               (11) With  respect to plan years  beginning  after  December  31,
          1984, the accrued  benefit of all  participants in a plan who have not
          performed  or  received  credit  for any  services  for  any  employer
          maintaining  the plan (other than benefits under the plan) at any time
          during the five (5) year  period  ending on the  plan's  determination
          date shall be disregarded.

               (12)  The  Top-Heavy   determination,   including  definition  of
          Top-Heavy terms and application of the above rules and any other rules
          which  may be  necessary  for  the  determination  shall  be  made  in
          accordance with Section 416 of the Code.

     "Transferred  Account  Balance" shall mean that portion of a  Participant's
Account  Balance  attributed  to  direct  trust-to-trust  transfers  from  other
qualified retirement plans (including,  without limitation,  those maintained by
Alltel and GTE), and those account balances transferred to this Plan as a result
of plan mergers (including, without limitation, the merger of the LGS Retirement
Savings Plan and the Gasco Bargaining 401(k) Plan.)
<PAGE>

     "TRASOP  Account"  shall  mean that  portion of the  Participant's  Account
Balance that is  attributable  to the merger of the  Company's  TRASOP Plan into
this Plan,  as adjusted for  subsequent  investment  gains,  losses,  income and
expenses.  A  Participant  shall be at all times  vested in his  TRASOP  Account
Balance.

     "Trust Agreement" shall mean a trust agreement,  if such trust agreement is
established  by the  Company,  between the  Company and such  Trustees as may be
appointed by the Company.  In the event that a trust  agreement is  established,
the trust shall include any and all amendments or supplements thereto.

     "Trustee" shall mean Putnam  Fiduciary  Trust Company,  and such additional
Trustees or successor  Trustees as in the future or from time to time thereafter
may be  appointed or  designated  by the Company to hold any portion of the Fund
forming a part of this Plan.

     "Valuation  Date" shall mean with respect to all assets held under the Plan
for  which  daily  valuation  is  performed,   the  date  of  liquidation  of  a
Participant's investment for distribution,  reinvestment,  exchange or transfer,
or any other applicable  transaction.  With respect to assets under the Plan for
which daily  valuation is not  available,  "Valuation  Date" shall mean the last
business day of the Plan Year,  and the last  business date of each month in the
Plan Year.

     "Voluntary After-tax  Contribution Account Balance" shall mean that portion
of  a  Participant's   Account  Balance   attributable  to  voluntary  after-tax
contributions credited to the Participant as a result of a plan-to-plan transfer
or plan merger,  where the transferor,  or merged,  plan previously offered such
contributions.




<PAGE>





Execution Page


     IN  WITNESS  WHEREOF,  this  plan  document  has  been  executed  by a duly
authorized officer of the Company.


Dated:                            CITIZENS COMMUNICATIONS COMPANY

Witnesses:

                                  By _______________________________________

                                     Its __________________________________