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3. *Eligibility.*  All employees and non-employee directors of the Company and its Subsidiariesare eligible for Awards under this Plan. The Committee shall select the Participants in the Planfrom time to time by the grant of Awards under the Plan.4. *Common Stock Available for Awards.*  There shall be available for Awards granted wholly orpartly in Common Stock (including rights or options which may be exercised for or settled in CommonStock) during the term of this Plan an aggregate of 4,585,000 shares of Common Stock, subject toadjustment as provided in Paragraph 14, all of which may be granted hereunder as incentive stockoptions. The Board of Directors and the appropriate officers of the Company shall from time totime take whatever actions are necessary to file required documents with governmental authoritiesand stock exchanges and transaction reporting systems to make shares of Common Stock available forissuance pursuant to Awards. Common Stock related to Awards that are forfeited or terminated,expire unexercised, are settled in cash in lieu of Common Stock or in a manner such that all orsome of the shares covered by an Award are not issued to a Participant, or are exchanged for Awardsthat do not involve Common Stock, shall immediately become available for Awards hereunder. TheCommittee may from time to time adopt and observe such procedures concerning the counting of sharesagainst the Plan maximum as it may deem appropriate under Rule 16b-3.5. *Administration.*  This Plan shall be administered by the Committee, which shall have fulland exclusive power to interpret this Plan and to adopt such rules, regulations and guidelines forcarrying out this Plan as it may deem necessary or proper, all of which powers shall be exercisedin the best interests of the Company and in keeping with the objectives of this Plan. TheCommittee may, in its discretion, provide for the extension of the exercisability of an Award,accelerate the vesting or exercisability of an Award, eliminate or make less restrictive anyrestrictions contained in an Award, waive any restriction or other provision of this Plan or anAward or otherwise amend or modify an Award in any manner that is either (a) not adverse to theParticipant holding such Award or (b) consented to by such Participant. The Committee may correctany defect or supply any omission or reconcile any inconsistency in this Plan or in any Award inthe manner and to the extent the Committee deems necessary or desirable to carry it into effect.Any decision of the Committee in the interpretation and administration of this Plan shall liewithin its sole and absolute discretion and shall be final, conclusive and binding on all partiesconcerned. No member of the Committee or officer of the Company to whom it has delegated authorityin accordance with the provisions of Paragraph 6 of this Plan shall be liable for anything done oromitted to be done by him or her, by any member of the Committee or by any officer of the Companyin connection with the performance of any duties under this Plan, except for his or her own willfulmisconduct or as expressly provided by statute.6. *Delegation of Authority.*  The Committee may delegate to the Chief Executive Officer and toother senior officers of the Company its duties under this Plan pursuant to such conditions orlimitations as the Committee may establish, except that the Committee may not delegate to anyperson the authority to grant Awards to, or take other action with respect to, Participants who aresubject to Section 16 of the Exchange Act.7. *Awards.*  The Committee shall determine the type or types of Awards to be made to eachParticipant under this Plan. Each Award made hereunder shall be embodied in an Award Agreement,which shall contain such terms, conditions and limitations as shall be determined by the Committeein its sole discretion and shall be signed by the Participant and by the Chief Executive Officer,the Chief Operating Officer or any Vice President of the Company for and on behalf of the Company.Awards may consist of those listed in this Paragraph 7 and may be granted singly, in combination orin tandem. Awards may also be made in combination or in tandem with, in replacement of, or asalternatives to grants or rights (a) under this Plan or any other employee plan of the Company orany of its Subsidiaries, including the plan of any acquired entity, or (b) made to any Company orSubsidiary employee by the Company or any Subsidiary. An Award may provide for the granting orissuance of additional, replacement or alternative Awards upon the occurrence of specified events,including the exercise of the original Award. Notwithstanding anything herein to the contrary, noParticipant may be granted during any calendar year Awards consisting of stock options or stockappreciation rights exercisable for more than 20% of the shares of Common Stock originallyauthorized for Awards under this Plan, subject to adjustment as provided in Paragraph 14. In theevent of an increase in the number of shares authorized under the Plan, the 20% limitation willapply to the increased number of shares authorized. The number of Awards that may be granted inthe form of a stockappreciation right or stock award as described in subparagraph (c) below shall not exceed anaggregate of 62,500 underlying shares of Common Stock issuable pursuant to such Award.
 
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(a) *Stock Option.*  An Award may consist of a right to purchase a specified number of shares of Common Stock at a price specified by the Committee in the Award Agreement orotherwise. No stock option shall have an exercise price less than 100% of the Fair MarketValue of a share of the Common Stock on the date of grant of the stock option, nor shall anystock option be exercisable later than the day before the expiration of ten (10) years fromthe date of grant of the stock option. A stock option may be in the form of an incentivestock option (“ISO”) which, in addition to being subject to applicable terms, conditions andlimitations established by the Committee, complies with Section 422 of the Code. ISOs maybe granted to any employee of the Company or a Subsidiary, but not to a non-employeedirector. Notwithstanding the foregoing, no ISO can be granted under the Plan more than tenyears following the Effective Date of the Plan or, if later, the date of approval by theCompany’s shareholders of an increase in the number of shares of Common Stock authorized tobe issued as Awards under the Plan, but only with respect to such increase.(b) *Stock Appreciation Right.*  An Award may consist of a right to receive a payment, incash or Common Stock, equal to the excess of the Fair Market Value or other specifiedvaluation of a specified number of shares of Common Stock on the date the stock appreciationright (“SAR”) is exercised over a specified strike price as set forth in the applicableAward Agreement.(c) *Stock Award.*  An Award may consist of Common Stock or may be denominated in unitsof Common Stock. All or part of any stock Award may be subject to conditions established bythe Committee and set forth in the Award Agreement, which conditions may include, but arenot limited to, continuous service with the Company and its Subsidiaries, achievement ofspecific business objectives, increases in specified indices, attaining specified growthrates and other comparable measurements of performance. Such Awards may be based on FairMarket Value or other specified valuations. The certificates evidencing shares of CommonStock issued in connection with a stock Award shall contain appropriate legends andrestrictions describing the terms and conditions of the restrictions applicable thereto.(d) *Cash Award.*  An Award may be denominated in cash with the amount of the eventualpayment subject to future service and such other restrictions and conditions as may beestablished by the Committee and set forth in the Award Agreement, including, but notlimited to, continuous service with the Company and its Subsidiaries, achievement ofspecific business objectives, increases in specified indices, attaining specified growthrates and other comparable measurements of performance.8. *Payment of Awards.*  (a) *General.*  Payment of Awards may be made in the form of cash or Common Stock orcombinations thereof and may include such restrictions as the Committee shall determineincluding, in the case of Common Stock, restrictions on transfer and forfeiture provisions.As used herein, “Restricted Stock” means Common Stock that is restricted or subject toforfeiture provisions.(b) *Deferral.*  The Committee may, in its discretion, (i) permit selected Participantsto elect to defer payments of some or all types of Awards in accordance with proceduresestablished by the Committee or (ii) provide for the deferral of an Award in an AwardAgreement or otherwise. Any such deferral may be in the form of installment payments or afuture lump sum payment. Any deferred payment, whether elected by the Participant orspecified by the Award Agreement or by the Committee, may be forfeited if and to the extentthat the Award Agreement so provides.(c) *Dividends and Interest.*  Dividends or dividend equivalent rights may be extended toand made part of any Award denominated in Common Stock or units of Common Stock, subject tosuch terms, conditions and restrictions as the Committee may establish. The Committee mayalso establish rules and procedures for the crediting of interest on deferred cash paymentsand dividend equivalents for deferred payment denominated in Common Stock or units of CommonStock.
 
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(d) *Substitution of Awards.*  At the discretion of the Committee, a Participant may beoffered an election to substitute an Award for another Award or Awards of the same ordifferent type.9. *Stock Option Exercise.*  The price at which shares of Common Stock may be purchased under astock option shall be paid in full at the time of exercise in cash or, if permitted by theCommittee, by means of tendering Common Stock or surrendering all or part of that or any otherAward, including Restricted Stock, valued at Fair Market Value on the date of exercise, or anycombination thereof. The Committee shall determine acceptable methods for tendering Common Stockor Awards to exercise a stock option as it deems appropriate. If permitted by the Committee,payment may be made by successive exercises by the Participant. The Committee may provide forprocedures to permit the exercise or purchase of Awards by (a) loans from the Company or (b) use ofthe proceeds to be received from the sale of Common Stock issuable pursuant to an Award. Unlessotherwise provided in the applicable Award Agreement, in the event shares of Restricted Stock aretendered as consideration for the exercise of a stock option, a number of the shares issued uponthe exercise of the stock option, equal to the number of shares of Restricted Stock used asconsideration therefor, shall be subject to the same restrictions as the Restricted Stock sosubmitted as well as any additional restrictions that may be imposed by the Committee.10. *Tax Withholding.*  The Company shall have the right to deduct applicable taxes from anyAward payment and withhold, at the time of delivery or vesting of cash or shares of Common Stockunder this Plan, an appropriate amount of cash or number of shares of Common Stock or a combinationthereof for payment of taxes required by law or to take such other action as may be necessary inthe opinion of the Company to satisfy all obligations for withholding of such taxes. The Committeemay also permit withholding to be satisfied by the transfer to the Company of shares of CommonStock theretofore owned by the holder of the Award with respect to which withholding is required.If shares of Common Stock are used to satisfy tax withholding, such shares shall be valued based onthe Fair Market Value when the tax withholding is required to be made.11. *Amendment, Modification, Suspension or Termination.*  The Board may amend, modify, suspendor terminate this Plan for the purpose of meeting or addressing any changes in legal requirementsor for any other purpose permitted by law except that (a) no amendment or alteration that wouldimpair the rights of any Participant under any Award previously granted to such Participant shallbe made without such Participant’s consent, and (b) no amendment or alteration shall be effectiveprior to approval by the Company’s stockholders to the extent such approval is then requiredpursuant to Rule 16b-3 in order to preserve the applicability of any exemption provided by suchrule to any Award then outstanding (unless the holder of such Award consents) or to the extentstockholder approval is otherwise required by applicable legal requirements.12. *Termination of Employment.*  Upon the termination of employment by a Participant, anyunexercised, deferred or unpaid Awards shall be treated as provided in the specific Award Agreementevidencing the Award. In the event of such a termination, the Committee may, in its discretion,provide for the extension of the exercisability of an Award, accelerate the vesting orexercisability of an Award, eliminate or make less restrictive any restrictions contained in anAward, waive any restriction or other provision of this Plan or an Award or otherwise amend ormodify the Award in any manner that is either (a) not adverse to such Participant or (b) consentedto by such Participant.13. *Assignability.*  Unless otherwise determined by the Committee and provided in the AwardAgreement, no Award or any other benefit under this Plan constituting a derivative security withinthe meaning of Rule 16a-1(c) under the Exchange Act shall be assignable or otherwise transferableexcept by will or the laws of descent and distribution or pursuant to a qualified domesticrelations order as defined by the Code or Title I of the Employee Retirement Income Security Act,or the rules thereunder. The Committee may prescribe and include in applicable Award Agreementsother restrictions on transfer. Any attempted assignment of an Award or any other benefit underthis Plan in violation of this Paragraph 13 shall be null and void.14. *Adjustments.*  (a) The existence of outstanding Awards shall not affect in any manner the right orpower of the Company or its stockholders to make or authorize any or all adjustments,recapitalizations, reorganizations or other changes in the capital stock of the Company orits business or any merger or consolidation of the Company, or any issue of bonds,debentures, preferred or prior preference stock(whether or not such issue is prior to, on a parity with or junior to the Common Stock)or the dissolution or liquidation of the Company, or any sale or transfer of all or any partof its assets or business, or any other corporate act or proceeding of any kind, whether ornot of a character similar to that of the acts or proceedings enumerated above.
 
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(b) In the event of any subdivision or consolidation of outstanding shares of CommonStock or declaration of a dividend payable in shares of Common Stock or capitalreorganization or reclassification or other transaction involving an increase or reductionin the number of outstanding shares of Common Stock, the Committee may adjust proportionally(i) the number of shares of Common Stock reserved under this Plan and covered by outstandingAwards denominated in Common Stock or units of Common Stock; (ii) the exercise or otherprice in respect of such Awards; and (iii) the appropriate Fair Market Value and other pricedeterminations for such Awards. In the event of any consolidation or merger of the Companywith another corporation or entity or the adoption by the Company of a plan of exchangeaffecting the Common Stock or any distribution to holders of Common Stock of securities orproperty (other than normal cash dividends or dividends payable in Common Stock), theCommittee shall make such adjustments or other provisions as it may deem equitable,including adjustments to avoid fractional shares, to give property effect to such event. Inthe event of a corporate merger, consolidation, acquisition of property or stock,separation, reorganization or liquidation, the Committee shall be authorized to issue orassume stock options, regardless of whether in a transaction to which Section 424(a) of theCode applies, by means of substitution of new options for previously issued options or anassumption of previously issued options, or to make provision for the acceleration of theexercisability of, or lapse of restrictions with respect to, Awards and the termination ofunexercised options in connection with such transaction.15. *Restrictions.*  No Common Stock or other form of payment shall be issued with respect toany Award unless the Company shall be satisfied based on the advice of its counsel that suchissuance will be in compliance with applicable federal and state securities laws. It is the intentof the Company that this Plan comply with Rule 16b-3 with respect to persons subject to Section 16of the Exchange Act unless otherwise provided herein or in an Award Agreement, that any ambiguitiesor inconsistencies in the construction of this Plan be interpreted to give effect to such intentionand that, if any provision of this Plan is found not to be in compliance with Rule 16b-3, suchprovision shall be null and void to the extent required to permit this Plan to comply with Rule16b-3. Certificates evidencing shares of Common Stock delivered under this Plan may be subject tosuch stop transfer orders and other restrictions as the Committee may deem advisable under therules, regulations and other requirements of the Securities and Exchange Commission, any securitiesexchange or transaction reporting system upon which the Common Stock is then listed and anyapplicable federal and state securities law. The Committee may cause a legend or legends to beplaced upon any such certificates to make appropriate reference to such restrictions.16. *Unfunded Plan.*  Insofar as it provides for Awards of cash, Common Stock or rights thereto,this Plan shall be unfunded. Although bookkeeping accounts may be established with respect toParticipants who are entitled to cash, Common Stock or rights thereto under this Plan, any suchaccounts shall be used merely as a bookkeeping convenience. The Company shall not be required tosegregate any assets that may at any time be represented by cash, Common Stock or rights thereto,nor shall this Plan be construed as providing for such segregation, nor shall the Company, theBoard or the Committee be deemed to be a trustee of any cash, Common Stock or rights thereto to begranted under this Plan. Any liability or obligation of the Company to any Participant withrespect to a grant of cash, Common Stock or rights thereto under this Plan shall be based solelyupon any contractual obligations that may be created by this Plan and any Award Agreement, and nosuch liability or obligation of the Company shall be deemed to be secured by any pledge or otherencumbrance on any property of the Company. None of the Company, the Board or the Committee shallbe required to give any security or bond for the performance of any obligation that may be createdby this Plan.17. *Governing Law.*  This Plan and all determinations made and actions taken pursuant hereto,to the extent not otherwise governed by mandatory provisions of the Code or the securities laws ofthe United States, shall be governed by and construed in accordance with the laws of the State ofTexas.18. *Effective Date of Plan.*  This Plan shall be effective as of the date (the “EffectiveDate”) it is approved by the Board of Directors of the Company. Notwithstanding the foregoing, theadoption of this Plan isexpressly conditioned upon the approval by the holders of a majority of shares of Common Stockpresent, or represented, and entitled to vote at a meeting of the Company’s stockholders held on orbefore April 1, 1994. If the stockholders of the Company should fail so to approve this Plan priorto such date, this Plan shall terminate and cease to be of any further force or effect, and allgrants of Awards hereunder shall be null and void.
 
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