<PAGE>
                                                                    EXHIBIT 10.7

                                 ALLERGAN, INC.

                           SAVINGS AND INVESTMENT PLAN

RESTATED
2003

<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
ARTICLE I
INTRODUCTION................................................................       1

1.1   Plan Name.............................................................       1
1.2   Plan Purpose..........................................................       1
1.3   Effective Date of 2003 Restated Plan..................................       1
1.4   Amendments to Plan....................................................       1
1.5   Plan Qualification....................................................       2

ARTICLE II
DEFINITIONS.................................................................       3

2.1   Accounts..............................................................       3
2.2   Affiliated Company....................................................       3
2.3   After Tax Deposits....................................................       3
2.4   After Tax Deposits Account............................................       3
2.5   Anniversary Date......................................................       3
2.6   Before Tax Deposits...................................................       3
2.7   Before Tax Deposits Account...........................................       3
2.8   Beneficiary...........................................................       3
2.9   Board of Directors....................................................       3
2.10  Break in Service......................................................       4
2.11  Code..................................................................       4
2.12  Committee.............................................................       4
2.13  Company...............................................................       4
2.14  Company Contributions.................................................       4
2.15  Company Contributions Accounts........................................       4
2.16  Company Stock.........................................................       4
2.17  Compensation..........................................................       4
2.18  Credited Service......................................................       5
2.19  Disability............................................................       7
2.20  Effective Date........................................................       7
2.21  Eligible Employee.....................................................       7
2.22  Eligible Retirement Plan..............................................       7
2.23  Eligible Rollover Distribution........................................       7
2.24  Employee..............................................................       8
2.25  Employment Commencement Date..........................................       9
2.26  ERISA.................................................................       9
2.27  Forfeitures...........................................................       9
2.28  415 Suspense Account..................................................       9
2.29  Highly Compensated Employee...........................................       9
2.30  Hour of Service.......................................................      10
2.31  Investment Manager....................................................      10
2.32  Leased Employee.......................................................      10
</TABLE>

<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
2.33  Leave of Absence......................................................      10
2.34  Matched Deposits......................................................      12
2.35  Matching Contributions................................................      12
2.36  Matching Contributions Account........................................      12
2.37  Normal Retirement Age.................................................      12
2.38  Participant...........................................................      12
2.39  Participant Deposits..................................................      12
2.40  Period of Severance...................................................      12
2.41  Plan..................................................................      12
2.42  Plan Administrator...................................................       12
2.43  Plan Year.............................................................      13
2.44  Reemployment Commencement Date........................................      13
2.45  Retirement Account Participant........................................      13
2.46  Retirement Contributions..............................................      13
2.47  Retirement Contributions Account......................................      13
2.49  Rollover Contributions................................................      13
2.48  Rollover Contributions Account........................................      13
2.50  Severance.............................................................      13
2.51  Severance Date........................................................      14
2.52  Sponsor...............................................................      14
2.53  Trust.................................................................      14
2.54  Trust Agreement.......................................................      14
2.55  Trustee...............................................................      14
2.56  Valuation Date........................................................      14

ARTICLE III
ELIGIBILITY AND PARTICIPATION...............................................      16

3.1   General Eligibility and Participation.................................      16
3.2   Eligibility for Retirement Contributions..............................      16
3.3   Duration of Participation.............................................      17
3.4   Eligibility and Participation After Normal Retirement Age.............      17

ARTICLE IV
PARTICIPANT DEPOSITS........................................................      18

4.1   Election..............................................................      18
4.2   Amount Subject to Election............................................      19
4.3   Limitation on Compensation Deferrals..................................      20
4.4   Provisions for Return of Excess Before Tax Deposits...................      23
4.5   Provision for Recharacterization or Return of Excess Deferrals
      by Highly Compensated Participants....................................      25
4.6   Termination, Change in Rate, or Resumption of
      Before Tax Deposits or After Tax Deposits.............................      27
4.7   Character of Deposits.................................................      27
4.8   Rollover Contributions................................................      27
</TABLE>


                                       ii
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
ARTICLE V
TRUST FUND AND COMPANY CONTRIBUTIONS........................................      29

5.1   General...............................................................      29
5.2   Single Trust..........................................................      29
5.3   Matching Contributions................................................      29
5.4   Retirement Contributions..............................................      30
5.5   Form of Company Contributions.........................................      30
5.6   Investment of Trust Assets............................................      30
5.7   Irrevocability........................................................      33
5.8   Company, Committee and Trustee Not Responsible for Adequacy
      of Trust Fund.........................................................      33
5.9   Certain Offers for Company Stock......................................      34
5.10  Voting of Company Stock...............................................      37
5.11  Securities Law Limitation.............................................      39
5.12  Distributions.........................................................      39
5.13  Taxes.................................................................      39
5.14  Trustee Records to be Maintained......................................      39
5.15  Annual Report of Trustee..............................................      39
5.16  Appointment of Investment Manager.....................................      40

ARTICLE VI
ACCOUNTS AND ALLOCATIONS....................................................      41

6.1   Participants' Accounts................................................      41
6.2   Allocation of Participant Deposits....................................      41
6.3   Allocation of Company Contributions and Forfeitures...................      41
6.4   Valuation of Participants' Accounts...................................      42
6.5   Valuation of Company Stock............................................      42
6.6   Dividends, Splits, Recapitalizations, Etc.............................      42
6.7   Stock Rights, Warrants or Options.....................................      42
6.8   Treatment of Accounts Upon Severance..................................      43
6.9   Cash Dividends........................................................      43
6.10  Miscellaneous Allocation Rules........................................      43
6.11  Limitations on After Tax Deposits and Matching Contributions..........      44
6.12  Provision for Disposition of Excess After Tax Deposits or
      Matching Contributions on Behalf of Highly Compensated Participants...      48

ARTICLE VII
VESTING IN PLAN ACCOUNTS....................................................      51

7.1   No Vested Rights Except as Herein Provided............................      51
7.2   Vesting of Participant Deposits.......................................      51
7.3   Vesting of Company Contributions......................................      51
</TABLE>


                                      iii
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
ARTICLE VIII
PAYMENT OF PLAN BENEFITS....................................................      53

8.1   Withdrawals During Employment.........................................      53
8.2   Distributions Upon Termination of Employment or Disability............      54
8.3   Distribution Upon Death of Participant................................      55
8.4   Designation of Beneficiary............................................      55
8.5   Hardship Withdrawal Rules.............................................      56
8.6   Distribution Rules....................................................      57
8.7   Forfeitures...........................................................      59
8.8   Valuation of Accounts Upon Distribution...............................      60
8.9   Lapsed Benefits.......................................................      60
8.10  Persons Under Legal Disability........................................      61
8.11  Additional Documents..................................................      61
8.12  Trustee-to-Trustee Transfers..........................................      62
8.13  Loans to Participants.................................................      62

ARTICLE IX
OPERATION AND ADMINISTRATION................................................      65

9.1   Appointment of Committee..............................................      65
9.2   Transaction of Business...............................................      65
9.3   Voting................................................................      65
9.4   Responsibility of Committee...........................................      65
9.5   Committee Powers......................................................      66
9.6   Additional Powers of Committee........................................      67
9.7   Periodic Review of Funding Policy.....................................      67
9.8   Claims Procedures.....................................................      67
9.9   Appeals Procedures....................................................      68
9.10  Limitation on Liability...............................................      69
9.11  Indemnification and Insurance.........................................      69
9.12  Compensation of Committee and Plan Expenses...........................      69
9.13  Resignation...........................................................      70
9.14  Reliance Upon Documents and Opinions..................................      70

ARTICLE X
AMENDMENT AND ADOPTION OF PLAN..............................................      71

10.1  Right to Amend Plan...................................................      71
10.2  Adoption of Plan by Affiliated Companies..............................      71

ARTICLE XI
DISCONTINUANCE OF CONTRIBUTIONS.............................................      72
</TABLE>


                                       iv
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
ARTICLE XII
TERMINATION AND MERGER......................................................      73

12.1  Right to Terminate Plan...............................................      73
12.2  Merger Restriction....................................................      73
12.3  Effect on Trustee and Committee.......................................      73
12.4  Effect of Reorganization, Transfer of Assets or Change in Control.....      73

ARTICLE XIII
LIMITATION ON ALLOCATIONS...................................................      76

13.1  General Rule..........................................................      76
13.2  Annual Additions......................................................      76
13.3  Other Defined Contribution Plans......................................      77
13.4  Adjustments for Excess Annual Additions...............................      77
13.5  Compensation..........................................................      77
13.6  Treatment of 415 Suspense Account Upon Termination....................      78

ARTICLE XIV
TOP-HEAVY RULES.............................................................      79
14.1  Applicability.........................................................      79
14.2  Definitions...........................................................      79
14.3  Top-Heavy Status......................................................      80
14.4  Minimum Contributions.................................................      81
14.5  Minimum Vesting Rules.................................................      82
14.6  Noneligible Employees.................................................      82

ARTICLE XV
RESTRICTION ON ASSIGNMENT OR  OTHER ALIENATION OF PLAN BENEFITS.............      83

15.1  General Restrictions Against Alienation...............................      83
15.2  Qualified Domestic Relations Orders...................................      83

ARTICLE XVI
MISCELLANEOUS PROVISIONS....................................................      87

16.1  No Right of Employment Hereunder......................................      87
16.2  Effect of Article Headings............................................      87
16.3  Limitation on Company Liability.......................................      87
16.4  Gender................................................................      87
16.5  Interpretation........................................................      87
16.6  Withholding For Taxes.................................................      87
16.7  California Law Controlling............................................      87
16.8  Plan and Trust as One Instrument......................................      87
16.9  Invalid Provisions....................................................      87
</TABLE>


                                       v

<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                PAGE
                                                                                ----
<S>                                                                             <C>
16.10   Counterparts........................................................      88

APPENDIX A
</TABLE>


                                       vi
<PAGE>

                                 ALLERGAN, INC.
                           SAVINGS AND INVESTMENT PLAN

                                   ARTICLE I
                                  INTRODUCTION

      1.1 Plan Name. This document, made and entered into by Allergan, Inc., a
Delaware corporation ("Allergan"), amends and restates in its entirety the
"Allergan, Inc. Savings and Investment Plan (Restated 2001)" and incorporates
the First Amendment made thereto, and shall be known hereafter as the "Allergan,
Inc. Savings and Investment Plan (Restated 2003)."

      1.2 Plan Purpose. The purpose of the Allergan, Inc. Savings and
Investment Plan (Restated 2003), hereinafter referred to as the "Plan," is to
enable Eligible Employees of Allergan, and any Affiliated Companies that are
authorized by the Board of Directors to participate in the Plan, to share in the
growth and prosperity of the Company and to provide Participants with an
opportunity to accumulate capital for their future economic security. All assets
acquired under the Plan as a result of Participant Deposits and Company
Contributions, income, and other additions to the Fund under the Plan shall be
administered, distributed, forfeited and otherwise governed by the provisions of
the Plan, which is to be administered by the Committee for the exclusive benefit
of Participants in the Plan and their Beneficiaries.

      1.3 Effective Date of 2003 Restated Plan. The Effective Date of this
amended and restated Plan shall be January 1, 2003. The provisions of this Plan
document apply only to Employees who have completed at least one (1) Hour of
Service for Allergan or any Affiliated Companies on or after January 1, 2003
unless otherwise specified in the Plan and the rights and benefits, if any, of
Employees or Participants whose employment with Allergan or any Affiliated
Companies terminated prior to January 1, 2003 shall be determined in accordance
with the provisions of the Plan then in effect unless otherwise provided herein
and subject to any modification provided herein that may affect the holding or
distribution of Participants' Accounts.

      1.4 Amendments to Plan. The Plan has been amended from time to time
since its Original Effective Date of July 26, 1989 to reflect changes in the
Plan's operations and applicable law including, but not limited to, the
following:

            (a) Effective January 1, 2003, this Plan document amends the Plan to
      enhance Company Contributions made to the Plan as provided herein, by (i)
      increasing the Company's Matching Contributions from an average 50% match
      on certain Participant Deposits not to exceed 5% of Compensation to a 100%
      match on certain Participant Deposits not to exceed 4% of Compensation and
      (ii) adding a Retirement Contributions feature under which Allergan will
      make contributions equal to 5% of Compensation for certain Eligible
      Employees hired on or after October 1, 2002 and for other Eligible
      Employees who make a one-time irrevocable election to cease active
      participation in the Allergan, Inc. Pension Plan. The Plan document also
      amends the Plan as is necessary to comply with applicable law and
      incorporates the amendments made under the First

<PAGE>

      Amendment to the Plan (Restated 2001) which include permitting all
      Participants to diversify their Matching Contributions without regard to
      age effective as of June 1, 2002.

            (b) Effective June 29, 2002, in connection with the distribution of
      the stock of Advanced Medical Optics, Inc. ("AMO") by Allergan to its
      stockholders (i) AMO Employees (as defined in Section 2.24) ceased to be
      eligible to make Participant Deposits or to receive allocations of Company
      Contributions, (ii) the assets and liabilities attributable to the
      Accounts of AMO Employees shall be transferred to the Advanced Medical
      Optics, Inc. 401(k) Plan, a qualified profit sharing plan with a qualified
      cash or deferred arrangement, in accordance with Code Section 414(l),
      Regulation Section 1.414(1)-1, and Section 208 of ERISA, and (iii) the AMO
      stock received with respect to Company Stock allocated to Participants'
      Accounts shall be held in a separate investment fund established by the
      Committee pursuant to Section 5.6 and Participants shall have subaccounts
      under the Plan corresponding to their interests in such investment fund.

            (c) Effective as of January 1, 1999, the Allergan, Inc. Puerto Rico
      Savings and Investment Plan was merged with and into the Plan. All account
      balances of the Allergan, Inc. Puerto Rico Savings and Investment Plan
      were transferred to the Plan and all account balances transferred to the
      Plan as a result of the merger are to be administered, distributed,
      forfeited and otherwise governed by the provisions of the Plan and
      Appendix A, which is attached hereto and made a part hereof.

      1.5 Plan Qualification. The Plan is an employee benefit plan that is
intended to qualify under Code Section 401(a) as a qualified profit sharing plan
and under Code Section 401(k) as a qualified cash or deferred arrangement. The
Plan's last determination letter was issued by the Internal Revenue Service on
July 22, 2002 with respect to the Allergan, Inc. Savings and Investment Plan
(Restated 2001) and its compliance with the changes to the qualification
requirements made by the Uruguay Round Agreements Act (GATT), 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 Community
Renewal Tax Relief Act of 2000. It is intended that the Economic Growth and Tax
Relief Reconciliation Act of 2001 ("EGTRRA") provisions of the Plan are to be
regarded as good faith compliance with the requirements of EGTRRA and are to be
construed in accordance with EGTRRA and guidance issued thereunder.


                                       2
<PAGE>

                                   ARTICLE II
                                   DEFINITIONS

      2.1. Accounts. "Accounts" or "Participant's Accounts" shall mean the After
Tax Deposits Accounts, Before Tax Deposits Accounts, Matching Contributions
Accounts, Retirement Contributions Accounts, and Rollover Contributions Accounts
maintained for the various Participants.

      2.2. Affiliated Company. "Affiliated Company" shall mean (i) any
corporation, other than the Sponsor, which is included in a controlled group of
corporations (within the meaning of Code Section 414(b)) of which the Sponsor is
a member, (ii) any trade or business, other than the Sponsor, which is under
common control (within the meaning of Code Section 414(c)) with the Sponsor,
(iii) any entity or organization, other than the Sponsor, which is a member of
an affiliated service group (within the meaning of Code Section 414(m)) of which
the Sponsor is a member, and (iv) any entity or organization, other than the
Sponsor, which is affiliated with the Sponsor under Code Section 414(o). An
entity shall be an Affiliated Company pursuant to this Section only during the
period of time in which such entity has the required relationship with the
Sponsor under clauses (i), (ii), (iii) or (iv) of this Section after the
Original Effective Date of the Plan.

      2.3. After Tax Deposits. "After Tax Deposits" shall mean those
contributions made by a Participant which represent after-tax contributions.

      2.4. After Tax Deposits Account. "After Tax Deposits Account" shall mean a
Participant's individual account in the Trust Fund in which are held his or her
After Tax Deposits and the earnings thereon.

      2.5. Anniversary Date. "Anniversary Date" shall mean the last day of each
Plan Year.

      2.6. Before Tax Deposits. "Before Tax Deposits" shall mean those
contributions made by a Participant which represent pre-tax contributions.

      2.7. Before Tax Deposits Account. "Before Tax Deposits Account" shall mean
a Participant's individual account in the Trust Fund in which are held his or
her Before Tax Deposits and the earnings thereon.

      2.8. Beneficiary. "Beneficiary" or "Beneficiaries" shall mean the person
or persons last designated by a Participant as set forth in Section 8.4 or, if
there is no designated Beneficiary or surviving Beneficiary, the person or
persons designated pursuant to Section 8.4 to receive the interest of a deceased
Participant in such event.

      2.9. Board of Directors. "Board of Directors" shall mean the Board of
Directors of the Sponsor (or its delegate) as it may from time to time be
constituted.


                                       3
<PAGE>

      2.10. Break in Service. "Break in Service" shall mean, with respect to an
Employee, each period of 12 consecutive months during a Period of Severance that
commences on the Employee's Severance Date or on any anniversary of such
Severance Date.

      2.11. Code. "Code" shall mean the Internal Revenue Code of 1986 and the
regulations thereunder. Reference to a specific Code Section shall be deemed
also to refer to any applicable regulations under that Section, and shall also
include any comparable provisions of future legislation that amend, supplement
or supersede that specific Section.

      2.12. Committee. "Committee" shall mean the committee to be appointed
under the provisions of Section 9.1 to administer the Plan.

      2.13. Company. "Company" shall mean collectively the Sponsor and each
Affiliated Company that adopts the Plan in accordance with Section 10.2.

      2.14. Company Contributions. "Company Contributions" shall mean Matching
Contributions and Retirement Contributions (whether in cash or other property,
including Company Stock), paid by the Company pursuant to Sections 5.3 and 5.4
into the Trust Fund established and maintained under the provisions of the Plan
for the purpose of providing benefits for Participants and their Beneficiaries.
Unless expressly stated otherwise in the Plan, Company Contributions shall not
include Before Tax Deposits, After Tax Deposits, or Rollover Contributions.

      2.15. Company Contributions Accounts. "Company Contributions Accounts"
shall mean a Participant's Matching Contributions Account and Retirement
Contributions Account.

      2.16. Company Stock. "Company Stock" shall mean any class of stock of the
Sponsor which both constitutes "qualifying employer securities" as defined in
Section 407(d)(5) of ERISA and "employer securities" as defined in Code Section
409(l).

      2.17. Compensation. "Compensation" shall mean the following:

            (a) Compensation shall include amounts paid during a Plan Year to a
      Participant by the Company for services rendered, including base earnings,
      commissions and similar incentive compensation, cost of living allowances
      earned within the United States of America, holiday pay, overtime
      earnings, pay received for election board duty, pay received for jury and
      witness duty, pay received for military service (annual training), pay
      received for being available for work, if required (call-in premium),
      shift differential and premium, sickness/accident related pay, vacation
      pay, vacation shift premium, and bonus amounts paid under the (i) Sales
      Bonus Program, (ii) Management Bonus Plan or Executive Bonus Plan, either
      in cash or in restricted stock, and (iii) group performance sharing
      payments, such as the "Partners for Success."

            (b) Compensation shall include amounts of salary reduction elected
      by a Participant under a Code Section 401(k) cash or deferred arrangement,
      a Code Section 125 cafeteria plan and, solely for purposes of determining
      Retirement


                                       4
<PAGE>

      Contributions under Section 5.4, amounts deferred under the Executive
      Deferred Compensation Plan.

            (c) Compensation shall not include business expense reimbursements;
      Company gifts or the value of Company gifts; Company stock related options
      and payments; employee referral awards; flexible compensation credits paid
      in cash; special overseas payments, allowances and adjustments including,
      but not limited to, pay for cost of living adjustments and differentials
      paid for service outside of the United States, expatriate reimbursement
      payments, and tax equalization payments; forms of imputed income;
      long-term disability pay; payment for loss of Company car; Company car
      allowance; payments for patents or for writing articles; relocation and
      moving expenses; retention and employment incentive payments; severance
      pay; long-term incentive awards, bonuses or payments; "Impact Award"
      payments; "Employee of the Year" payments; "Awards for Excellence"
      payments; special group incentive payments and individual recognition
      payments which are nonrecurring in nature; tuition reimbursement; and
      contributions by the Company under the Plan or distributions hereunder,
      any contributions or distributions pursuant to any other plan sponsored by
      the Company and qualified under Code Section 401(a) (other than
      contributions constituting salary reduction amounts elected by the
      Participant under a Code Section 401(k) cash or deferred arrangement), any
      payments under a health or welfare plan sponsored by the Company, or
      premiums paid by the Company under any insurance plan for the benefit of
      Employees.

            (d) Compensation for any Plan Year shall not include amounts in
      excess of $200,000, as adjusted for cost-of-living increases in accordance
      with Code Section 401(a)(17)(B) for purposes of determining all benefits
      provided under the Plan for any Plan Year. Any cost-of-living adjustments
      in effect for a calendar year shall apply to the Plan Year beginning with
      or within such calendar year.

            (e) Notwithstanding the foregoing, for purposes of applying the
      provisions of Articles XIII and XIV, a Participant's Compensation shall be
      determined pursuant to the definition of "Compensation" as set forth in
      Section 13.5 or 14.2(i), as the case may be.

      2.18. Credited Service. "Credited Service" shall mean, with respect to
each Employee, his or her years and months of Credited Service determined in
accordance with the following rules:

            (a) In the case of any Employee who was employed by the Company at
      any time prior to the Original Effective Date, for the period prior to
      January 1, 1989 such Employee shall be credited with Credited Service
      under the Plan equal to the period (if any) of service credited to such
      Employee under the SmithKline Beckman Savings and Investment Plan.

            (b) In the case of any Employee who is employed by the Company on or
      after the Original Effective Date, an Employee shall receive Credited
      Service for the elapsed period of time between each Employment
      Commencement Date (or Reemployment


                                       5
<PAGE>

      Commencement Date) of the Employee and the Severance Date which
      immediately follows that Employment Commencement Date (or Reemployment
      Commencement Date). Solely for the purpose of determining an Employee's
      Credited Service under this paragraph (b), in the case of an Employee who
      is employed on January 1, 1989, that date shall be deemed to be an
      Employment Commencement Date of the Employee (with service credit for
      periods prior to January 1, 1989 to be determined under paragraph (a)
      above). An Employee who is absent from work on an authorized Leave of
      Absence shall be deemed to have incurred a Severance (if any) in
      accordance with the rules of Section 2.50.

            (c) An Employee shall receive Credited Service credit for periods
      between a Severance and his or her subsequent Reemployment Commencement
      Date in accordance with the following rules:

                  (i) If an Employee incurs a Severance by reason of a quit,
            discharge, Disability, or retirement whether or not such a Severance
            occurs during an approved Leave of Absence and the Employee is later
            reemployed by the Company prior to his or her incurring a Break in
            Service, he or she shall receive Credited Service for the period
            commencing with his or her Severance Date and ending with his or her
            subsequent Reemployment Commencement Date.

                  (ii) Other than as expressly set forth above in this paragraph
            (c), an Employee shall receive no Credited Service with respect to
            periods between a Severance and a subsequent Reemployment
            Commencement Date.

            (d) For all purposes of the Plan, an Employee's total Credited
      Service shall be determined by aggregating any separate periods of
      Credited Service separated by any Breaks in Service.

            (e) An Employee shall be credited with Credited Service with respect
      to a period of employment with an Affiliated Company, but only to the
      extent that such period of employment would be so credited under the
      foregoing rules set forth in this Section had such Employee been employed
      during such period by the Company.

            (f) Notwithstanding the foregoing, unless the Sponsor shall so
      provide by resolution of its Board of Directors, or unless otherwise
      expressly stated in the Plan, an Employee shall not receive such Credited
      Service credit for any period of employment with an Affiliated Company
      prior to such entity becoming an Affiliated Company.

            (g) In accordance with paragraph (f) above, an Eligible Employee
      shall receive Credited Service for any period of employment with Allergan
      Medical Optics - Lenoir facility prior to its becoming an Affiliated
      Company but only to the extent provided in paragraph (e) above.
      Notwithstanding anything therein to the contrary, the Employment
      Commencement Date for such Eligible Employee under paragraph (b) shall
      mean the date the Employee was first credited with an Hour of Service with
      Allergan


                                       6
<PAGE>

      Medical Optics - Lenoir facility, including any date prior to Allergan
      Medical Optics - Lenoir facility becoming an Affiliated Company.

            (h) Notwithstanding any provision of the Plan to the contrary,
      contributions, benefits and service credit with respect to qualified
      military service shall be provided in accordance with Code Section 414(u).

      2.19. Disability. "Disability" shall mean any mental or physical condition
which, in the judgment of the Committee, based on such competent medical
evidence as the Committee may require, renders an individual unable to engage in
any substantial gainful activity for the Company for which he or she is
reasonably fitted by education, training, or experience and which condition can
be expected to result in death or which has lasted or can be expected to last
for a continuous period of at least 12 months. The determination by the
Committee, upon opinion of a physician selected by the Committee, as to whether
a Participant has incurred a Disability shall be final and binding on all
persons.

      2.20. Effective Date. "Effective Date" of this restated Plan shall mean
January 1, 2003 unless otherwise specified in the Plan. The "Original Effective
Date" of the Plan shall mean July 26, 1989.

      2.21. Eligible Employee. "Eligible Employee" shall mean any United
States-based payroll Employee and any Puerto Rico-based payroll Employee of the
Company and any expatriate Employee of the Company who is a United States
citizen or permanent resident, but excluding any non-resident alien of the
United States and Puerto Rico, any non-regular manufacturing site transition
Employee, any Leased Employee, and any Employee covered by a collective
bargaining agreement.

      2.22. Eligible Retirement Plan. "Eligible Retirement Plan" shall mean (i)
an individual retirement account or annuity described in Code Section 408(a) or
408(b), (ii) a qualified retirement plan described in Code Section 401(a) or
403(a) that accepts Eligible Rollover Distributions, (iii) an annuity contract
described in Code Section 403(b) that accepts Eligible Rollover Distributions,
and (iv) an eligible plan described in Code Section 457(b) which is maintained
by a state, political subdivision of a state, or any agency or instrumentality
of a state or political subdivision of a state and which agrees to separately
account for amounts transferred into such plan from this Plan. The definition of
Eligible Retirement Plan shall also apply in the case of an Eligible Rollover
Distribution to a surviving spouse or to a spouse or former spouse who is an
Alternate Payee under a Qualified Domestic Relations Order (as defined in
Article XV).

      2.23. Eligible Rollover Distribution. "Eligible Rollover Distribution"
shall mean any distribution of all or any portion of the balance to the credit
of the Distributee, except that an Eligible Rollover Distribution shall not
include:

            (a) any distribution that is one of a series of substantially equal
      periodic payments (not less frequently than annually) made for the life
      (or life expectancy) of the Distributee of the joint lives (or joint life
      expectancies) of the Distributee and the


                                       7
<PAGE>

      Distributee's designated beneficiary, or for a specified period of ten
      years or more;

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

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

            (d) any hardship withdrawal made pursuant to Section 8.1(e); and

            (e) any other distribution that is reasonably expected to total less
      than $200 during the year.

      A portion of a distribution shall not fail to be an Eligible Rollover
Distribution merely because the portion consists of After Tax Deposits or the
portion consists of rollover after tax employee contributions made pursuant to
Section 4.8.which are not includible in gross income. However, such portion(s)
may be transferred only to an individual retirement account or annuity described
in Code Section 408(a) or 408(b) or to a qualified defined contribution plan
described in Code Section 401(a) or 403(a) that agrees to separately account for
amounts so transferred, including separately accounting for the portion of such
distribution which is includible in gross income and the portion of such
distribution which is not so includible. For purposes of this Section,
"Distributee" shall mean any Employee or former Employee receiving a
distribution from the Plan. A Distributee also includes the Employee or former
Employee's surviving spouse and the Employee or former Employee's spouse or
former spouse who is the Alternate Payee under a Qualified Domestic Relations
Order (as defined in Article XV) with regard to the interest of the spouse or
former spouse.

      2.24. Employee. "Employee" shall mean, for purposes of the Plan, any
individual who is employed by the Sponsor or an Affiliated Company in any
capacity, any portion of whose income is subject to withholding of income tax
and/or for whom Social Security contributions are made by the Sponsor or an
Affiliated Company, including any Puerto Rico-based payroll Employee of the
Sponsor or an Affiliated Company; provided, however, that such term shall not
include:

            (a) Any individual who performs services for the Sponsor or an
      Affiliated Company and who is classified or paid as an independent
      contractor as determined by the payroll records of the Sponsor or an
      Affiliated Company even if a court or administrative agency determines
      that such individual is a common-law employee and not an independent
      contractor;

            (b) Any individual who performs services for the Sponsor or an
      Affiliated Company pursuant to an agreement between the Sponsor or an
      Affiliated Company and any other person including a leasing organization
      except to the extent such individual is a Leased Employee; and


                                       8
<PAGE>

             (c) Any individual whose employment is transferred from the Sponsor
      or an Affiliated Company to Advanced Medical Optics, Inc. ("AMO") in
      connection with the distribution of the stock of AMO by the Sponsor to its
      stockholders, effective as of the day following such transfer, hereinafter
      referred to as an "AMO Employee." An individual is an AMO Employee if
      classified or identified as such in the payroll records of the Sponsor or
      an Affiliated Company or in the Employee Matters Agreement entered into
      between the Sponsor and AMO.

      2.25. Employment Commencement Date. "Employment Commencement Date" shall
mean the date on which an Employee is first credited with an Hour of Service for
the Sponsor or an Affiliated Company. An Employee shall not, for the purpose of
determining his or her Employment Commencement Date, be deemed to have commenced
employment with an Affiliated Company prior to the effective date on which the
entity became an Affiliated Company unless the Sponsor expressly determines
otherwise, and except as is expressly provided otherwise in the Plan or in
resolutions of the Board of Directors.

      2.26. ERISA. "ERISA" shall mean the Employee Retirement Income Security
Act of 1974 and the regulations thereunder. Reference to a specific ERISA
Section shall be deemed also to refer to any applicable regulations under that
Section, and shall also include any comparable provisions of future legislation
that amend, supplement or supersede that specific Section.

      2.27. Forfeitures. "Forfeitures" shall mean the nonvested portion of a
Participant's Matching Contributions Account or Retirement Contributions
Account, whichever the case may be, that is forfeited in accordance with the
provisions of Article VIII.

      2.28. 415 Suspense Account. "415 Suspense Account" shall mean the account
(if any) established and maintained in accordance with the provisions of Article
XIII for the purpose of holding and accounting for allocations of excess Annual
Additions (as defined in Article XIII).

      2.29. Highly Compensated Employee. "Highly Compensated Employee" shall
mean:

            (a) An Employee who performed services for the Employer during the
      Plan Year or preceding Plan Year and is a member of one or more of the
      following groups:

                  (i) Employees who at any time during the Plan Year or
            preceding Plan Year were Five Percent Owners (as defined in Section
            14.2).

                  (ii) Employees who received Compensation during the preceding
            Plan Year from the Employer in excess of $80,000 (as adjusted in
            such manner as permitted under Code Section 414(q)(1)).

            (b) For the purpose of this Section, the term "Compensation" means
      compensation as defined in Code Section 415(c)(3), as set forth in Section
      13.5.


                                       9
<PAGE>

             (c) The term "Highly Compensated Employee" includes a Former Highly
      Compensated Employee. A Former Highly Compensated Employee is any Employee
      who was (i) a Highly Compensated Employee when he or she terminated
      employment with the Employer or (ii) a Highly Compensated Employee at any
      time after attaining age 55. Notwithstanding the foregoing, an Employee
      who separated from service prior to 1987 shall be treated as a Former
      Highly Compensated Former Employee only if during the separation year (or
      year preceding the separation year) or any year after the Employee attains
      age 55 (or the last year ending before the Employee's 55th birthday), the
      Employee either received Compensation in excess of $50,000 or was a Five
      Percent Owner.

            (d) For the purpose of this Section, the term "Employer" shall mean
      the Sponsor and any Affiliated Company.

            (e) The determination of who is a Highly Compensated Employee,
      including the determination of the Compensation that is considered, shall
      be made in accordance with Code Section 414(q) and applicable regulations
      to the extent permitted thereunder. The Committee, for administrative
      convenience, may establish rules and procedures for purposes of
      identifying Highly Compensated Employees, which rules and procedures may
      result in an Eligible Employee being deemed to be a Highly Compensated
      Employee for purposes of the limitations of Article IV and Article VI,
      whether or not such Eligible Employee is a Highly Compensated Employee
      described in Code Section 414(q).

      2.30. Hour of Service. "Hour of Service" shall mean an hour for which an
Employee is paid or entitled to payment for the performance of duties for the
Sponsor and any Affiliated Company.

      2.31. Investment Manager. "Investment Manager" shall mean the one or more
Investment Managers, if any, that are appointed pursuant to Section 5.16 and who
constitute investment managers under Section 3(38) of ERISA.

      2.32. Leased Employee. "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 Code Section 414(n)(6)) on a substantially full time basis for a period of
at least one (1) year, and such services are performed under the primary
direction or control by 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 Leased Employees do not constitute more than 20 percent of the
recipient's nonhighly compensated workforce and such Leased Employee is covered
by a money purchase pension plan providing (i) a nonintegrated employer
contribution rate of at least ten (10) percent of compensation as defined under
Code Section 415(c)(3); (ii) immediate participation; and (iii) full and
immediate vesting.

      2.33. Leave of Absence.


                                       10
<PAGE>

            (a) "Leave of Absence" shall mean any personal leave from active
      employment (whether with or without pay) duly authorized by the Company
      under the Company's standard personnel practices. All persons under
      similar circumstances shall be treated alike in the granting of such
      Leaves of Absence. Leaves of Absence may be granted by the Company for
      reasons of health (including temporary sickness or short term disability)
      or public service or for any other reason determined by the Company to be
      in its best interests.

            (b) In addition to Leaves of Absence as defined in paragraph (a)
      above, the term Leave of Absence shall also mean a Maternity or Paternity
      Leave, as defined herein, but only to the extent and for the purposes
      required under paragraph (c) below. As used herein, "Maternity or
      Paternity Leave" shall mean an absence from work for any period (i) by
      reason of the pregnancy of the Employee, (ii) by reason of the birth of a
      child of the Employee, (iii) by reason of the placement of a child with
      the Employee in connection with the adoption of the child by the Employee,
      or (iv) for purposes of caring for the child for a period beginning
      immediately following the birth or placement referred to in clauses (ii)
      or (iii) above.

            (c) Subject to the provisions of paragraph (d) below, a Maternity or
      Paternity Leave described in paragraph (b) above shall be deemed to
      constitute an authorized Leave of Absence for purposes of the Plan only to
      the extent consistent with the following rules:

                  (i) For purposes of determining whether a Break in Service has
            occurred, the Severance Date of a Participant who is absent by
            reason of a Maternity or Paternity Leave shall not be deemed to
            occur any earlier than the second anniversary of the date upon which
            such Maternity or Paternity Leave commences.

                  (ii) The Maternity or Paternity Leave shall be treated as a
            Leave of Absence solely for purposes of determining whether or not
            an Employee has incurred a Break in Service. Accordingly, such a
            Maternity or Paternity Leave shall not result in an accrual of
            Credited Service for purposes of the vesting provisions of the Plan
            or for purposes of the eligibility and participation provisions of
            Article III (except only in determining whether a Break in Service
            has occurred).

                  (iii) A Maternity or Paternity Leave shall not be treated as a
            Leave of Absence unless the Employee provides such timely
            information as the Committee may reasonably require to establish
            that the absence is for the reasons listed in paragraph (b) above
            and to determine the number of days for which there was such an
            absence.

            (d) Notwithstanding the limitations provided in paragraph (c) above,
      a Maternity or Paternity Leave described in paragraph (b) above shall be
      treated as an


                                       11
<PAGE>

      authorized Leave of Absence, as described in paragraph (a), for all
      purposes of the Plan to the extent the period of absence is one authorized
      as a Leave of Absence under the Company's standard personnel practices and
      thus is covered by the provisions of paragraph (a) above without reference
      to the provisions of paragraph (b) above, provided, however, that the
      special rule provided under this paragraph (d) shall not apply if it would
      result in a Participant who is absent on a Maternity or Paternity Leave
      being deemed to have incurred a Break in Service sooner than under the
      rules set forth in paragraph (c).

      2.34. Matched Deposits. "Matched Deposits" of a Participant shall mean his
or her Participant Deposits (whether Before Tax or After Tax but excluding
Rollover Contributions) not in excess of four percent (4%) of Compensation;
except, however, that Matched Deposits shall not include "catch-up" Before Tax
Deposits as described in Section 4.2(e). Matched Deposits shall participate in
allocations of Matching Contributions and Matching Contribution Forfeitures.

      2.35. Matching Contributions. "Matching Contributions" shall mean all
amounts (whether in cash or other property, including Company Stock) paid by the
Company pursuant to Sections 5.3(a) and 5.3(b) into the Trust Fund established
and maintained under the provisions of the Plan for the purpose of providing
benefits for Participants and their Beneficiaries.

      2.36. Matching Contributions Account. "Matching Contributions Account"
shall mean a Participant's individual account in the Trust Fund in which are
held Matching Contributions, any amounts transferred from the Participant's
account in the SmithKline Beckman Savings and Investment Plan to the Plan, and
the earnings thereon. Any amounts transferred from the Participant's account in
the SmithKline Beckman Savings and Investment Plan to the Plan shall be fully
vested.

      2.37. Normal Retirement Age. "Normal Retirement Age" shall mean a
Participant's sixty-fifth (65th) birthday.

      2.38. Participant. "Participant" shall mean any Eligible Employee or
former Eligible Employee who has commenced participation in the Plan pursuant to
Section 3.1 and who retains rights under the Plan.

      2.39. Participant Deposits. "Participant Deposits" shall mean all of a
Participant's deposits to the Plan, including After Tax Deposits, Before Tax
Deposits, and Rollover Contributions.

      2.40. Period of Severance. "Period of Severance" shall mean the period of
time commencing on an Employee's Severance Date and ending on the Employee's
subsequent Reemployment Commencement Date, if any.

      2.41. Plan. "Plan" shall mean the Allergan, Inc. Savings and Investment
Plan described herein and as amended from time to time.

      2.42. Plan Administrator. Plan Administrator" shall mean the administrator
of the Plan within the meaning of Section 3(16)(A) of ERISA. The Plan
Administrator shall be the Allergan


                                       12
<PAGE>

Corporate Benefits Committee whose members are appointed by the Board of
Directors pursuant to the provisions of Section 9.1 to administer the Plan.

      2.43. Plan Year. "Plan Year" shall mean the calendar year.

      2.44. Reemployment Commencement Date. "Reemployment Commencement Date"
shall mean, in the case of an Employee who incurs a Severance and who is
subsequently reemployed by the Sponsor or an Affiliated Company, the first day
following the Severance on which the Employee is credited with an Hour of
Service for the Sponsor or an Affiliated Company with respect to which he or she
is compensated or entitled to compensation by the Sponsor or an Affiliated
Company. An Employee shall not, for the purpose of determining his or her
Reemployment Commencement Date, be deemed to have commenced employment with an
Affiliated Company prior to the effective date on which such entity becomes an
Affiliated Company unless the Sponsor shall expressly determine otherwise, and
except as is expressly provided otherwise in the Plan or in resolutions of the
Board of Directors.

      2.45. Retirement Account Participant. "Retirement Account Participant"
shall mean any Eligible Employee who has met the eligibility requirements of
Section 3.2 but excluding any Eligible Employee who is an "Active Participant"
in the Allergan, Inc. Pension Plan as such term is defined therein.

      2.46. Retirement Contributions. "Retirement Contributions" shall mean all
amounts (whether in cash or other property, including Company Stock) paid by the
Company pursuant to Section 5.4 into the Trust Fund established and maintained
under the provisions of the Plan for the purpose of providing benefits for
Participants and their Beneficiaries.

      2.47. Retirement Contributions Account. "Retirement Contributions Account"
shall mean a Participant's individual account in the Trust Fund in which are
held Retirement Contributions and the earnings thereon.

      2.48. Rollover Contributions. "Rollover Contributions" shall mean those
contributions made by a Participant pursuant to Section 4.8.

      2.49. Rollover Contributions Account. "Rollover Contributions Account"
shall mean a Participant's individual account in the Trust Fund in which are
held Rollover Contributions made pursuant to Section 4.8.

      2.50. Severance. "Severance" shall mean the termination of an Employee's
employment with the Sponsor or an Affiliated Company by reason of such
Employee's quit, discharge, Disability, death, retirement, or otherwise. For
purposes of determining whether an Employee has incurred a Severance, the
following rules shall apply:

            (a) An Employee shall not be deemed to have incurred a Severance (i)
      because of his or her absence from employment with the Sponsor or an
      Affiliated Company by reason of any paid vacation or holiday period, or
      (ii) by reason of any Leave of Absence, subject to the provisions of
      paragraph (b) below.


                                       13
<PAGE>

            (b) For purposes of the Plan, an Employee shall be deemed to have
      incurred a Severance on the earlier of (i) the date on which he or she
      dies, resigns, is discharged, or otherwise terminates his or her
      employment with the Sponsor or an Affiliated Company; or (ii) the date on
      which he or she is scheduled to return to work after the expiration of an
      approved Leave of Absence, if he or she does not in fact return to work on
      the scheduled expiration date of such Leave. In no event shall an
      Employee's Severance be deemed to have occurred before the last day on
      which such Employee performs any services for the Sponsor or an Affiliated
      Company in the capacity of an Employee with respect to which he or she is
      compensated or entitled to compensation by the Sponsor or an Affiliated
      Company.

            (c) Notwithstanding the foregoing, in the case of a Participant who
      is absent by reason of a Maternity or Paternity Leave, the provisions of
      Section 2.33(c)-(d) shall apply for purposes of determining whether such a
      Participant has incurred a Break in Service by reason of such Leave.

      2.51. Severance Date. "Severance Date" shall mean, in the case of any
Employee who incurs a Severance, the day on which such Employee is deemed to
have incurred said Severance as determined in accordance with the provisions of
Section 2.50, provided, however, that the special rules set forth under Section
2.33(c)-(d) shall apply with respect to determining whether a Participant on a
Maternity or Paternity Leave has incurred a Break in Service. In the case of any
Employee who incurs a Severance as provided under Section 2.50 and who is
entitled to a subsequent payment of compensation for reasons other than future
services (e.g., as back pay for past services rendered or as payments in the
nature of severance pay), the Severance Date of such Employee shall be as of the
effective date of the Severance event (e.g., the date of his or her death,
effective date of a resignation or discharge, etc.), and the subsequent payment
of the aforementioned type of post-Severance compensation shall not operate to
postpone the timing of the Severance Date for purposes of the Plan.

      2.52. Sponsor. "Sponsor" shall mean Allergan, Inc., a Delaware
corporation, and any successor corporation or entity.

      2.53. Trust. "Trust" or "Trust Fund" shall mean the trust maintained
pursuant to the Trust Agreement and as described in Section 5.1 hereof, which
shall hold all cash and securities and all other assets of whatsoever nature
deposited with or acquired by the Trustee in its capacity as Trustee hereunder,
together with accumulated net earnings.

      2.54. Trust Agreement. "Trust Agreement" shall mean the agreement between
the Trustee and the Sponsor pursuant to which the Trust is maintained.

      2.55. Trustee. "Trustee" shall mean the individual or entity acting as a
trustee of the Trust Fund.

      2.56. Valuation Date. "Valuation Date" shall mean the date as of which the
Trustee shall determine the value of the assets in the Trust Fund for purposes
of determining the value of


                                       14
<PAGE>

each Account, which shall be each business day in accordance with rules applied
in a consistent and uniform basis.


                                       15
<PAGE>

                                  ARTICLE III
                          ELIGIBILITY AND PARTICIPATION

      3.1 General Eligibility and Participation. An Eligible Employee shall
participate in the Plan on the later of: (i) his or her Employment Commencement
Date or (ii) the date he or she becomes an Eligible Employee. A Participant who
incurs a Severance shall participate in the Plan immediately upon his or her
Reemployment Commencement Date so long as he or she is reemployed as an Eligible
Employee.

      3.2 Eligibility for Retirement Contributions. An Eligible Employee shall
be eligible to receive allocations of Retirement Contributions as provided in
Section 5.4 only if he or she is a Retirement Account Participant as described
below:

            (a) An Eligible Employee shall become a Retirement Account
      Participant on the date that immediately follows the later of:

                  (i) The date such Eligible Employee performs an Hour of
            Service as an Eligible Employee;

                  (ii) The date such Eligible Employee completes six (6) months
            of Credited Service with the Sponsor or an Affiliated Company as an
            Employee; or

                  (iii) The date such Eligible Employee ceases to be an "Active
            Participant" in the Allergan, Inc. Pension Plan as such term is
            defined therein.

            (b) A Participant who becomes a Retirement Account Participant shall
      remain an active Retirement Account Participant until he or she: (i)
      incurs a Severance, (ii) transfers employment to an Affiliated Company
      that has not adopted the Plan pursuant to Section 10.2, or (iii) is no
      longer an Eligible Employee even though he or she remains an Employee of
      the Company, at which time such Retirement Account Participant shall
      become an inactive Retirement Account Participant and shall no longer be
      eligible to receive allocations of Retirement Contributions as provided in
      Section 5.4.

            (c) A Retirement Account Participant or an Employee who is not a
      Retirement Account Participant but who has completed the service
      requirement specified in paragraph (a)(i) above shall, if he or she incurs
      a Severance and is subsequently reemployed as an Eligible Employee, become
      a Retirement Account Participant immediately upon his or her Reemployment
      Commencement Date. A Retirement Account Participant who becomes an
      inactive Retirement Account Participant shall become a Retirement Account
      Participant upon the date he or she resumes Eligible Employee status. An
      Employee who has not completed the service requirement specified in
      paragraph (a)(i) above shall, if he or she incurs a Severance and is
      subsequently reemployed, become a Retirement Account Participant on the
      date determined under paragraph (a) above.


                                       16
<PAGE>

      3.3 Duration of Participation. An Eligible Employee who becomes a
Participant shall remain an active Participant until he or she incurs a
Severance, at which time he or she shall become an inactive Participant until he
or she receives a distribution of the entire vested portion of his or her
Accounts. Once such a distribution is made, such Participant shall no longer be
considered a Participant in the Plan. A Participant who (i) transfers out of
employment with the Company but who remains an Employee of an Affiliated Company
that has not adopted the Plan pursuant to Section 10.2, or (ii) remains an
Employee of the Company but is no longer an Eligible Employee, shall become an
inactive Participant.

      3.4 Eligibility and Participation After Normal Retirement Age. An Eligible
Employee may become, or continue as, a Participant or a Retirement Account
Participant after reaching his or her Normal Retirement Age in the same manner
as an Eligible Employee who has not reached his or her Normal Retirement Age.


                                       17
<PAGE>

                                   ARTICLE IV

                              PARTICIPANT DEPOSITS

      4.1 Election.

            (a) Each Eligible Employee may elect to defer the receipt of a
      portion of his or her Compensation and to have the deferred amount
      contributed directly by the Company to the Plan as Before Tax Deposits.
      Before Tax Deposits may be made only by means of payroll deduction.

            (b) Each Eligible Employee may elect to contribute to the Plan a
      portion of his or her Compensation as After Tax Deposits. After Tax
      Deposits may be made only by means of payroll deduction.

            (c) The Committee shall prescribe procedures to implement automatic
      enrollment elections, pursuant to which an Eligible Employee or, if
      limited to newly hired Eligible Employees as determined by the Committee,
      shall be deemed to have elected to defer the receipt of three percent (3%)
      of his or her Compensation and to have such deferred amount contributed
      directly by the Company to the Plan as Before Tax Deposits if such
      Eligible Employee fails to change or terminate the automatic election for
      any Plan Year within the time period prescribed by the Committee (or, in
      the case of newly hired Eligible Employee, he or she fails to change or
      terminate the automatic election within 30 days of his or her hire date).
      Such procedures shall require that an Eligible Employee receive a written
      notice of explanation of the automatic election informing the Eligible
      Employee of the effective date of the automatic election, the automatic
      deferral percentage and his or her right to terminate the automatic
      election or to change the amount of his or her Before Tax Deposits made to
      the Plan as well as the procedures for exercising such rights and the
      timing for implementing a different election. An automatic election under
      this paragraph (c) shall be effective as of the first pay period of the
      Plan Year (or, in the case of newly hired Eligible Employee, the first pay
      period following the 30-day period beginning on his or her date of hire)
      and shall remain in effect until superseded by a subsequent election by
      the Eligible Employee. Amounts contributed directly by the Company to the
      Plan under this paragraph (c) shall be invested in the Balanced Fund
      described in Section 5.6(b) until superseded by a subsequent election by
      the Eligible Employee.

            (d) Notwithstanding anything in this Section to the contrary, a
      Participant who makes a withdrawal of After Tax Deposits (whether Matched
      Deposits or non-Matched Deposits) pursuant to Section 8.1(a) or a hardship
      withdrawal pursuant to Section 8.1(e) shall not be permitted to make
      Before Tax Deposits or After Tax Deposits to the Plan during the 6-month
      period beginning as soon as administratively feasible following the date
      of the hardship withdrawal. The foregoing sentence shall not apply to a
      withdrawal of After Tax Deposits if the After Tax Deposits can also be
      withdrawn under Section 8.1(d) or the withdrawal is comprised solely of
      After Tax Deposits which are not Matched Deposits and which were
      contributed prior to July 1, 2000.


                                       18
<PAGE>

            (e) The Committee shall prescribe such procedures, either in writing
      or in practice, and provide such forms as are necessary or appropriate for
      each Participant and each Eligible Employee who will become a Participant
      to make Deposits pursuant to this Article IV subject, however to the
      requirement that an election by a Participant shall not be adopted
      retroactively.

      4.2 Amount Subject to Election.

            (a) Each Participant may elect to contribute a whole percentage of
      his or her Compensation to the Plan as Before Tax Deposits not to exceed
      the lesser of one hundred percent (100%) when aggregated with the After
      Tax Deposits contributed by such Participant pursuant to paragraph (b)
      below. Notwithstanding the foregoing except to the extent permitted under
      the catch-up provisions of paragraph (e) below and Code Section 414(v), no
      Participant shall be permitted to make Before Tax Deposits to the Plan
      during any taxable year in excess of: (i) $12,000 (or such larger amount
      as may be determined by the Secretary of the Treasury pursuant to Code
      Section 402(g), hereinafter referred to as the "Before Tax Deposit Limit",
      (ii) the Actual Deferral Percentage test limitation set forth in Section
      4.3, or (iii) the Annual Addition limitation set forth in Section 13.1.
      For purposes of the Before Tax Deposit Limit described in preceding clause
      (i), the Before Tax Deposits of a Participant for any taxable year is the
      sum of all Before Tax Deposits under the Plan and all salary reduction
      amounts under any other qualified cash or deferred arrangement (as defined
      in Code Section 401(k)), a simplified employee pension (as defined in Code
      Section 408(k) and Code Section 402(h)(1)(B)), a deferred compensation
      plan under Code Section 457, a trust described in Code Section 501(c)(18)
      and any salary reduction amount used to purchase an annuity contract under
      Code Section 403(b) whether or not sponsored by the Company but shall not
      include any amounts properly distributed as excess annual additions.

            (b) Each Participant may elect to contribute a whole percentage of
      his or her Compensation to the Plan as After Tax Deposits not to exceed
      one hundred percent (100%) when aggregated with the Before Tax Deposits
      contributed by such Participant pursuant to paragraph (a) above.
      Notwithstanding the foregoing, no Participant shall be permitted to make
      After Tax Deposits to the Plan during any Plan Year in excess of the
      Actual Contribution Percentage test limitation set forth in Section 6.11
      or the Annual Addition limitation set forth in Section 13.1 and the
      Committee may, in its discretion, establish an "After Tax Deposit Limit"
      for a Plan Year.

            (c) Notwithstanding paragraphs (a) and (b), a Participant's combined
      Before Tax Deposits and After Tax Deposits shall not exceed a
      Participant's Compensation net of his or her salary deductions or
      reductions (including but not limited to, federal withholding taxes and
      "FICA" taxes deducted pursuant Code Sections 3102 and 3402, respectively,
      withholding of state taxes, and amounts contributed by the Company
      pursuant to a salary reduction agreement which are excludable from an
      Employee's gross income under Code Sections 125, 132(f)(4), 402(e)(3),
      402(h)(1)(B) and 403(b)) as determined by the payroll records of the
      Sponsor or an Affiliated Company.


                                       19
<PAGE>

            (d) Notwithstanding paragraphs (a) and (b), a Participant who makes
      a hardship withdrawal pursuant to Section 8.1(e) or a withdrawal of After
      Tax Deposits (whether Matched Deposits or non-Matched Deposits) pursuant
      to Section 8.1(a) shall not be permitted to make Before Tax Deposits or
      After Tax Deposits to the Plan during the 6-month period beginning as soon
      as administratively feasible following the date of the withdrawal. The
      preceding sentence shall not apply to a withdrawal of After Tax Deposits
      if such Deposits can also be withdrawn under Section 8.1(d) or the
      withdrawal is comprised solely of After Tax Deposits which are not Matched
      Deposits and which were contributed prior to July 1, 2000.

            (e) Each Participant who has attained age 50 before the close of the
      Plan Year may elect to contribute a percentage of his or her Compensation
      to the Plan as "catch-up" Before Tax Deposits in accordance with, and
      subject to the limitations of, Code Section 414(v). Such catch-up Before
      Tax Deposits shall not be taken into account under subparagraph (a) above
      or Section 13.1 or any other provision of the Plan implementing the
      contribution limitations of Code Sections 402(g) and 415. Moreover, the
      Plan shall not be treated as failing to satisfy the provisions of the plan
      implementing the requirements of Code Section 401(k)(3), 401(k)(11),
      401(k)(12), 410(b), or 416, as applicable, by reason of a Participant
      electing to contribute catch-up Before Tax Deposits to the Plan pursuant
      to this paragraph.

            (f) The Committee shall prescribe such procedures, either in writing
      or in practice, as it deems necessary or appropriate regarding the maximum
      amount that a Participant may elect to defer and the timing of such an
      election. These procedures shall apply to all individuals eligible to make
      an election described in Section 4.1. The Committee may, at any time
      during a Plan Year, require the suspension, reduction, or
      recharacterization of Before Tax Deposits or the suspension or reduction
      of After Tax Deposits of any Highly Compensated Employee such that the
      limitations of Section 4.2(a) and (b) are satisfied.

      4.3 Limitation on Compensation Deferrals. With respect to each Plan Year,
Compensation Deferral Contributions by a Participant for the Plan Year shall not
exceed the limitation on contributions by or on behalf of Highly Compensated
Participants under Code Section 401(k), as provided in this Section. In the
event that Compensation Deferral Contributions under the Plan by or on behalf of
Highly Compensated Participants exceed the limitations of this Section for any
reason, either such excess contributions shall be recharacterized as After Tax
Deposits or such excess contributions, adjusted for any income or loss allocable
thereto, shall be returned to the Participant, as provided in Section 4.5.

            (a) The Compensation Deferral Contributions by Participants for a
      Plan Year shall satisfy the Actual Deferral Percentage Test set forth in
      (i) below, or, to the extent not precluded by applicable regulations, the
      alternative Actual Deferral Percentage test set forth in (ii) below:


                                       20
<PAGE>

                   (i) The average Actual Deferral Percentage of Highly
            Compensated Participants for the Plan Year shall not be more than
            the prior Plan Year's average Actual Deferral Percentage of
            Participants who were not Highly Compensated Employees for the prior
            Plan Year multiplied by 1.25, or

                  (ii) The average Actual Deferral Percentage of Highly
            Compensated Participants for the Plan Year shall not be more than
            the prior Plan Year's Actual Deferral Percentage of Participants who
            were not Highly Compensated Employees for the prior Plan Year
            multiplied by 2.0, provided that the average Actual Deferral
            Percentage of Highly Compensated Participants does not exceed the
            average Actual Deferral Percentage of Participants who were not
            Highly Compensated Employees for the prior Plan Year by more than
            two (2) percentage points.

            (b) Notwithstanding any other provisions of the Plan, for the
      purposes of the limitations of this Section 4.3 and Section 4.5 only, the
      following definitions shall apply:

                  (i) "Actual Deferral Percentage" shall mean, with respect to
            the group of Highly Compensated Participants and the group of all
            other Participants for a Plan Year, the ratios calculated separately
            and to the nearest one-hundredth of one percent for each Participant
            in such group, as follows:

                        (1) For a Highly Compensated Participant, the ratio of
                  such Participant's Compensation Deferral Contributions for the
                  current Plan Year to such Participant's Compensation for the
                  current Plan Year; provided, however, that the Actual Deferral
                  Percentage of a Highly Compensated Participant with no
                  Compensation Deferral Contributions made on his or her behalf
                  shall be zero.

                        (2) For any other Participant, the ratio of such
                  Participant's Compensation Deferral Contributions for the
                  preceding Plan Year to such Participant's Compensation for the
                  preceding Plan Year; provided, however, that the Actual
                  Deferral Percentage of a Participant with no Compensation
                  Deferral Contributions made on his or her behalf shall be
                  zero.

                  To the extent determined by the Committee and in accordance
            with regulations issued by the Secretary of the Treasury, qualified
            nonelective contributions on behalf of a Participant that satisfy
            the requirements of Code Section 401(k)(3)(c)(ii) may also be taken
            into account for the purpose of determining the Actual Deferral
            Percentage of a Participant.

                  (ii) "Highly Compensated Participant" shall mean for any Plan
            Year any Participant who is a Highly Compensated Employee. A
            Participant is a Highly Compensated Employee for a particular Plan
            Year if he or she meets the definition of a Highly Compensated
            Employee in effect for that Plan Year.


                                       21
<PAGE>

            Similarly, a Participant is not a Highly Compensated Employee for a
            particular Plan Year if he or she does not meet the definition of a
            Highly Compensated Employee in effect for that Plan Year.

                  (iii) "Participant" shall mean any Eligible Employee who
            satisfied the requirements of Section 3.1 during the Plan Year,
            whether or not such Eligible Employee has elected to contribute to
            the Plan for such Plan Year.

                  (iv) "Compensation Deferral Contributions" shall mean amounts
            contributed to the Plan by a Participant as Before Tax Deposits
            pursuant to Section 4.2(a), including excess Before Tax Deposits (as
            defined in Section 4.4(a)) of Highly Compensated Participants but
            excluding (1) excess Before Tax Deposits of all other Participants
            that arise solely from Before Tax Deposits made under the Plan or
            plans of the Company, (2) Before Tax Deposits that are taken into
            account in the Actual Contribution Percentage test (as defined in
            Section 6.11) provided that the Actual Deferral Percentage test is
            satisfied both with and without exclusions of these Before Tax
            Deposits, and (3) any deferrals properly distributed as excess
            Annual Additions. Compensation Deferral Contributions may include,
            at the election of the Company, any Company Contributions that meet
            the requirements for such inclusion under Code Section 401(k)(3)(C).

                  (v) "Compensation" shall mean compensation as described below:

                        (1) Compensation means compensation determined by the
                  Company in accordance with the requirements of Code Section
                  414(s) and the regulations thereunder.

                        (2) For purposes of this Section 4.3, Compensation may,
                  at the Company's election, exclude amounts which are
                  excludable from a Participant's gross income under Code
                  Section 125 (pertaining to cafeteria plans) and Code Section
                  402(e)(3) (pertaining to 401(k) salary reductions). The
                  Company may change its election provided such change does not
                  discriminate in favor of Highly Compensated Employees.

                        (3) Compensation taken into account for any Plan Year
                  shall not exceed $200,000, as adjusted for cost-of-living
                  increases in accordance with Code Section 401(a)(17)(B). Any
                  cost-of-living adjustments in effect for a calendar year shall
                  apply to the Plan Year beginning with or within such calendar
                  year.

            (c) In the event the Plan satisfies the requirements of Code
      Sections 401(k), 401(a)(4) or 410(b) only if aggregated with one or more
      other plans which include arrangements under Code Section 401(k), then
      this Section 4.3 shall be applied by determining the Actual Deferral
      Percentages of Participants as if all such plans were a single plan, in
      accordance with regulations prescribed by the Secretary of the


                                       22
<PAGE>

      Treasury under Code Section 401(k). Any adjustments to the Actual Deferral
      Percentage of Participants who are not Highly Compensated Employees for
      the prior year shall be made in accordance with Notice 98-1 and any
      superseding guidance. Plans may be aggregated in order to satisfy Code
      Sections 401(k) only if they have the same Plan Year and use the same
      Actual Deferral Percentage testing method.

            (d) For the purposes of this Section 4.3, the "Actual Deferral
      Percentage" for any Highly Compensated Participant who is a Participant
      under two or more Code Section 401(k) arrangements of the Company shall be
      determined by taking into account the Highly Compensated Participant's
      compensation under each such arrangement and contributions under each such
      arrangement which qualify for treatment under Code Section 401(k), in
      accordance with regulations prescribed by the Secretary of the Treasury
      under Code Section 401(k). If the arrangements have different Plan Years,
      this paragraph shall be applied by treating all such arrangements ending
      with or within the same calendar year as a single arrangement.
      Notwithstanding the foregoing, certain plans shall be treated as separate
      plans if mandatorily disaggregated pursuant to regulations under Code
      Section 401(k).

            (e) For purposes of the Actual Deferral Percentage test,
      Compensation Deferral Contributions must be made before the last day of
      the twelve-month period immediately following the Plan Year to which such
      contributions relate.

            (f) The determination and treatment of Compensation Deferral
      Contributions and the Actual Deferral Percentage of any Participant shall
      satisfy such other requirements as may be prescribed by the Secretary of
      the Treasury.

            (g) The Committee shall keep or cause to have kept such records as
      are necessary to demonstrate that the Plan satisfies the requirements of
      Code Section 401(k) and (m) and the regulations thereunder, in accordance
      with regulations prescribed by the Secretary of the Treasury.

      4.4 Provisions for Return of Excess Before Tax Deposits.

            (a) In the event that due to error or otherwise, an amount of a
      Participant's Compensation in excess of the Before Tax Deposit Limit
      (after application of any necessary adjustment) described in Section
      4.2(a) is deferred under the Plan in any calendar year pursuant to such
      Participant's Compensation deferral agreement (but without regard to
      amounts deferred under any other plan) the excess Before Tax Deposits, if
      any, together with income allocable to such amount shall be returned to
      the Participant (after withholding applicable federal, state and local
      taxes due on such amounts) on or before the first April 15 following the
      close of the calendar year in which such excess contribution is made;
      provided, however, if there is a loss allocable to the excess Before Tax
      Deposits, the amount distributed shall be the amount of the excess as
      adjusted to reflect such loss. Any Matching Contributions allocated to the
      Participant's Matched Deposits pursuant to Section 6.3(b) which are
      attributable to any excess Before Tax Deposits by a Participant, and any
      income or loss allocable to such Matching


                                       23
<PAGE>

      Contributions, shall either be returned to the Company or applied to
      reduce any future Matching Contributions by the Company.

            (b) The amount of income or loss attributable to any excess Before
      Tax Deposits described in paragraph (a) above shall be equal to the sum of
      the following:

                  (i) The income or loss allocable to the Participant's Before
            Tax Deposits Account for the Plan Year multiplied by a fraction, the
            numerator of which is the excess Before Tax Deposits as determined
            under paragraph (a) above, and the denominator of which is the
            balance of the Participant's Before Tax Deposits Account as of the
            last day of the Plan Year, without regard to any income or loss
            allocable to such Account during the Plan Year; and

                  (ii) The amount of allocable income or loss for the Gap Period
            using the "safe harbor" method set forth in regulations prescribed
            by the Secretary of the Treasury under Code Section 402(g). Under
            the "safe harbor" method, such allocable income or loss is equal to
            10% of the amount calculated under Section 4.4(b)(i) above,
            multiplied by the number of calendar months from the last day of the
            Plan Year until the date of distribution of the Participant's excess
            Before Tax Deposits. A distribution on or before the 15th of the
            month is treated as made on the last day of the preceding month, a
            distribution after the 15th of the month is treated as made on the
            first day of the next month.

            (c) For the purpose of this Section 4.4, "Gap Period" shall mean the
      period between the last day of the Plan Year and the date of distribution
      of any excess Before Tax Deposits.

            (d) In accordance with procedures as may be established, either in
      writing or in practice, by the Committee, not later than March 1 of a
      calendar year a Participant may submit a claim to the Committee in which
      he or she certifies in writing the specific amount of his or her Before
      Tax Deposits for the preceding calendar year which, when added to amounts
      deferred for such calendar year under other plans or arrangements
      described in Code Sections 401(k), 408(k) or 403(b), shall cause the
      Participant to exceed the Before Tax Deposit Limit (after application of
      any necessary adjustment) described in Section 4.2(a) for such preceding
      calendar year. Notwithstanding the amount of the Participant's Before Tax
      Deposits under the Plan for such preceding calendar year, the Committee
      shall treat the amount specified by the Participant in his or her claim as
      a Before Tax Deposit in excess of the Before Tax Deposit Limit (after
      application of any necessary adjustment) for such calendar year and return
      it to the Participant in accordance with Section 4.4(a) above. A
      Participant is deemed to notify the Committee of any excess Before Tax
      Deposits that arise by taking into account only those Before Tax Deposits
      made to the Plan and other plans of the Company.

            (e) Any Before Tax Deposits in excess of the Before Tax Deposit
      Limit (after application of any necessary adjustment) described in Section
      4.2(a) which are distributed to a Participant in accordance with this
      Section, shall to the extent required by regulations


                                       24
<PAGE>

      issued by the Secretary of the Treasury be treated as Annual Additions
      under Article XIII for the Plan Year for which the excess Before Tax
      Deposits were made, unless such amounts are distributed no later than the
      first April 15th following the close of the Participant's taxable year.

            (f) The Committee shall not be liable to any Participant (or his or
      her Beneficiary, if applicable) for any losses caused by a mistake in
      calculating the amount of any Participant's excess Before Tax Deposits or
      the income or losses attributable thereto.

      4.5 Provision for Recharacterization or Return of Excess Deferrals by
Highly Compensated Participants. The provisions of this Section 4.5 shall be
applied after implementation of the provisions of Section 4.4.

            (a) The Committee shall determine in accordance with the procedures
      set forth in Section 4.3, as soon as is reasonably possible following the
      close of each Plan Year, the extent (if any) to which deferral treatment
      under Code Section 401(k) may not be available for Compensation Deferral
      Contributions on behalf of any Highly Compensated Participants. If,
      pursuant to these determinations by the Committee, a Highly Compensated
      Participant's Compensation Deferral Contributions are not eligible for
      tax-deferral treatment then, as determined by the Committee, either (i)
      any excess Compensation Deferral Contributions shall be recharacterized as
      After Tax Deposits in accordance with regulations issued under Code
      Section 401(k), or (ii) any excess Compensation Deferral Contributions
      together with any income or loss allocable thereto shall be returned to
      the Highly Compensated Participant (after withholding applicable federal,
      state, and local taxes due on such amounts). Such return or
      recharacterization shall be made within the first two and one-half (2-1/2)
      months following the close of the Plan Year for which such excess
      deferrals were made, provided however, that if any excess deferrals and
      income or loss allocable thereto are, due to error or otherwise, not
      returned by such date, such amounts as are required to be returned shall
      be returned not later than the end of the first Plan Year following the
      Plan Year for which such excess deferrals were made.

            (b) For purposes of satisfying the Actual Deferral Percentage test
      of Section 4.3(a), the amount of any excess Compensation Deferral
      Contributions by a Highly Compensated Participant shall be determined by
      the Committee by application of a leveling method under which the
      Compensation Deferral Contributions of the Highly Compensated Participant
      who has the highest dollar amount of Compensation Deferral Contributions
      for such Plan Year is reduced to the extent required to cause such Highly
      Compensated Participant's Compensation Deferral Contributions to equal the
      Compensation Deferral Contributions of the Highly Compensated Participant
      with the next highest Compensation Deferral Contributions; provided,
      however, if a lesser amount, when added to the total dollar amount already
      returned under this paragraph (b), equals the total excess Compensation
      Deferral Contributions that are required to be returned to enable the Plan
      to satisfy the Actual Deferral Percentage test, the lesser amount shall be
      returned. This process shall be repeated until the Plan satisfies the
      Actual Deferral Percentage test.


                                       25
<PAGE>

            (c) The amount of income or loss attributable to any excess
      Compensation Deferral Contributions by a Highly Compensated Participant
      for a Plan Year shall be equal to the sum of the following:

                  (i) The income or loss allocable to the Highly Compensated
            Participant's Compensation Deferral Contribution Accounts for the
            Plan Year multiplied by a fraction, the numerator of which is the
            excess Compensation Deferral Contribution as determined under
            Section 4.3, and the denominator of which is the balance of the
            Highly Compensated Participant's Compensation Deferral Contribution
            Accounts as of the last day of the Plan Year without regard to any
            income or loss allocable to such Accounts during the Plan Year; and

                  (ii) The amount of allocable income or loss for the Gap Period
            using the "safe harbor" method set forth in the regulations
            prescribed by the Secretary of the Treasury under Code Section
            401(k). Under the "safe harbor" method, such allocable income or
            loss is equal to 10% of the amount calculated under Section
            4.5(c)(i) above, multiplied by the number of calendar months from
            the last day of the Plan Year until the date of distribution of the
            Participant's excess Compensation Deferral Contribution. A
            distribution on or before the 15th of the month is treated as made
            on the last day of the preceding month, a distribution after the
            15th of the month is treated as made on the first day of the next
            month.

            (d) For the purpose of this Section 4.5 the following shall apply:

                  (i) "Compensation Deferral Contribution Accounts" shall mean
            the Participant's Before Tax Deposits Account and shall mean any
            other accounts of the Participant to which Company Contributions has
            been allocated where such Company Contributions has been included as
            Compensation Deferral Contributions pursuant to Section 4.3(b)(iv).

                  (ii) "Gap Period" shall mean the period beginning with the
            last day of the Plan Year and the date of distribution of any excess
            Compensation Deferral Contributions.

            (e) For purposes of this Section, the amount of Compensation
      Deferral Contributions by a Participant who is not a Highly Compensated
      Participant for a Plan Year shall be reduced by any Before Tax Deposits
      which have been distributed to the Participant under Section 4.4, in
      accordance with regulations prescribed by the Secretary of the Treasury
      under Code Section 401(k).

            (f) In the event that the Committee determines that an amount to be
      deferred pursuant to the Compensation deferral agreement provided in
      Section 4.1 would cause Company Contributions under this and any other
      tax-qualified retirement plan maintained by the Company to exceed the
      applicable deduction limitations contained in Code Section 404, or to
      exceed the maximum Annual Addition determined in accordance with


                                       26
<PAGE>

      Article XIII, the Committee may treat such amount in accordance with the
      rules set forth above in Section 4.5(a).

            (g) The Committee shall not be liable to any Participant (or his or
      her Beneficiary, if applicable) for any losses caused by a mistake in
      calculating the amount of any Participant's excess Compensation Deferral
      Contribution or the income or losses attributable thereto.

            (h) To the extent required by regulations under Code Sections 401(k)
      or 415, any excess Compensation Deferral Contributions with respect to a
      Highly Compensated Participant shall be treated as Annual Additions under
      Article XIII for the Plan Year for which the excess Compensation Deferral
      Contributions were made, notwithstanding the distribution of such excess
      in accordance with the provisions of this Section.

      4.6 Termination, Change in Rate, or Resumption of Before Tax Deposits or
After Tax Deposits.

            (a) A Participant may, at any time, terminate, change the rate, or
      resume Before Tax Deposits or After Tax Deposits in 1% increments.

            (b) The right of a Participant to make Before Tax Deposits or After
      Tax Deposits shall cease during any Period of Severance.

            (c) Any termination, change in rate or resumption of Before Tax
      Deposits or After Tax Deposits made by a Participant pursuant to paragraph
      (a) above shall be effective as of the following pay period or, if later,
      as soon as administratively feasible.

      4.7 Character of Deposits. Before Tax Deposits shall be treated as Company
Contributions for purposes of Code Sections 401(k) and 414(h). After Tax
Deposits shall not constitute "qualified voluntary employee contributions" under
Code Section 219 (relating to the deductibility of those amounts).

      4.8 Rollover Contributions.

            (a) Pursuant to procedures as the Committee may prescribe (either in
      writing or practice), an Eligible Employee may make a Direct Rollover
      Contribution, a Participant Rollover Contribution, or an IRA Rollover
      Contribution to the Plan.

            (b) A "Direct Rollover Contribution" shall mean a contribution by an
      Eligible Employee which is a direct rollover of an Eligible Rollover
      Distribution from:

                  (i) A qualified plan described in Code Section 401(a) or
            403(a) including any portion attributable to after-tax employee
            contributions which shall be separately accounted for under the
            Plan;


                                       27
<PAGE>

                   (ii) An annuity contract described in Code Section 403(b) but
            excluding any portion attributable to after-tax employee
            contributions; or

                  (iii) An eligible plan under Code Section 457(b) which is
            maintained by a state, political subdivision of a state, or any
            agency or instrumentality of a state or political subdivision of a
            state.

            (c) A "Participant Rollover Contribution" shall mean a contribution
      by an Eligible Employee which is an Eligible Rollover Distribution
      (excluding any portion attributable to after-tax employee contributions)
      received by the Trustee not later than 60 days after such distribution was
      received by the Eligible Employee; provided, such Eligible Rollover
      Distribution is from:

                  (i) A qualified plan described in Code Section 401(a) or
            403(a);

                  (ii) An annuity contract described in Code Section 403(b); or

                  (iii) An eligible plan under Code Section 457(b) which is
            maintained by a state, political subdivision of a state, or any
            agency or instrumentality of a state or political subdivision of a
            state.

            (d) An "IRA Rollover Contribution" shall mean a contribution by an
      Eligible Employee which is a distribution (excluding any portion
      attributable to after-tax employee contributions) from an individual
      retirement account or annuity described in Code Section 408(a) or 408(b)
      received by the Trustee not later than 60 days after such distribution was
      received by the Eligible Employee or received by the Plan through a direct
      trustee-to-trustee transfer from such individual retirement arrangement or
      annuity.

            (e) Pursuant to procedures as the Committee may prescribe (either in
      writing or practice), a former Eligible Employee who commenced
      participation in the Plan pursuant to Section 3.1 may make Rollover
      Contributions to the Plan from his or her account in the Allergan, Inc.
      Employee Stock Ownership Plan so long as he or she retains rights under
      the Plan.

            (f) An Eligible Employee's Rollover Contributions made pursuant the
      rules of this Section 4.8 shall be held in a separate Rollover
      Contributions Account for the Eligible Employee. A Rollover Contributions
      Account shall not share in any allocations of Company Contributions or
      Forfeitures under Section 6.3.


                                       28
<PAGE>

                                   ARTICLE V
                      TRUST FUND AND COMPANY CONTRIBUTIONS

      5.1 General. All contributions made under the Plan and investments made
and property of any kind or character acquired with any such funds or otherwise
contributed, and all income, profits, and proceeds derived therefrom, shall be
held in Trust and shall be held and administered by the Trustee in accordance
with the provisions of the Plan and Trust Agreement.

      5.2 Single Trust. Assets of the Trust shall be held in a separate fund
which shall consist of the Trust Fund. Individual Participant interests in the
Trust Fund shall be reflected in the Accounts maintained for the Participants.
Notwithstanding the foregoing, the Trust Fund shall be treated as a single trust
for purposes of investment and administration, and nothing contained herein
shall require a physical segregation of assets for any fund or for any Account
maintained under the Plan.

      5.3 Matching Contributions. Subject to the limitations of Article XIII,
the suspension provisions of Section 8.1 and to the extent that the Company has
current or accumulated profits, the Company shall make Matching Contributions to
the Plan on behalf of Participants in accordance with the following rules:

            (a) The Company shall contribute and allocate Matching Contributions
      on a pay period basis which, when added to Matching Contribution
      Forfeitures available after application of Section 6.3, is equal to 100%
      of each Participant's Matched Deposits for the pay period. The Board of
      Directors, acting upon the advice and direction of the Committee, may
      authorize and direct that Matching Contributions (expressed as a
      percentage of Participants' Matched Deposits as set forth above) be
      changed from time to time from a minimum of 0% to a maximum of 100%.

            (b) As of a date not later than the last day of each Plan Year, the
      Company shall contribute and allocate on behalf of each Eligible
      Participant, additional Matching Contributions which, when added to
      Matching Contribution Forfeitures available after application of Section
      6.3, is equal to the difference, if any, between the amount of each
      Eligible Participant's Matching Contributions determined under paragraph
      (a) and the amount of such Eligible Participant's Matching Contributions
      if paragraph (a) was applied on a Plan Year basis instead of a pay period
      basis. For the purpose of this paragraph (b), the term "Eligible
      Participant" shall include only those Participants who are Eligible
      Employees on the first and last business day of the Plan Year and who did
      not incur a Severance during the Plan Year.

            (c) The Company shall contribute amounts sufficient to satisfy the
      Matching Contributions reinstatement requirements of Section 8.7 to the
      extent Matching Contribution Forfeitures are insufficient to satisfy the
      reinstatement requirement of Section 8.7 and any plan expense requirements
      of Section 9.11 if so directed and at such times as may be determined by
      the Committee.


                                       29
<PAGE>

      5.4 Retirement Contributions. Subject to the limitations of Article XIII
and to the extent that the Company has current or accumulated profits, the
Company shall make Retirement Contributions to the Plan on behalf of Retirement
Account Participants in accordance with the following rules:

            (a) The Company shall contribute and allocate Retirement
      Contributions on a Plan Year basis for each Retirement Account Participant
      who is employed by the Company or an Affiliated Company on the last day of
      such Plan Year or who incurred a Severance during the Plan Year by reason
      of Disability, death, or retirement on or after age 55; the amount of
      which, when added to Retirement Contribution Forfeitures available after
      the application of Section 6.3, shall be equal to five percent (5%) of the
      Retirement Account Participant's Compensation (as adjusted pursuant to
      paragraph (c) below) for such Plan Year. A Retirement Account
      Participant's Compensation received while such Retirement Account
      Participant is an inactive Participant as defined in Section 3.2(b) or an
      "Active Participant" in the Allergan, Inc. Pension Plan as such term is
      defined therein or while he or she is not an Eligible Employee shall not
      be taken into account in determining such Participant's Retirement
      Contributions.

            (b) Retirement Contributions contributed on behalf of Retirement
      Account Participants shall be allocated to the Retirement Contributions
      Account of such Retirement Account Participants as of the last day of each
      Plan Year and shall be paid to the Trust at such times as determined by
      the Sponsor.

            (c) Solely for the purpose of determining Retirement Contributions
      pursuant to this Section 5.4, a Retirement Account Participant's
      Compensation shall include his or her "Annual Deferrals" (as defined in
      the Allergan, Inc. Executive Deferred Compensation Plan) for the Plan
      Year.

            (d) The Company shall contribute amounts sufficient to satisfy the
      Retirement Contributions reinstatement requirements of Section 8.7 to the
      extent Retirement Contribution Forfeitures are insufficient to satisfy the
      reinstatement requirement of Section 8.7 and any plan expense requirements
      of Section 9.11 if so directed and at such times as may be determined by
      the Committee.

      5.5 Form of Company Contributions. Company Contributions to the Trust Fund
shall be paid in cash, property, or Company Stock as the Sponsor may from time
to time determine.

      5.6 Investment of Trust Assets.

            (a) The manner in which assets of the Trust will be invested shall
      be chosen by the Committee at its discretion, although the Committee may
      delegate the management to one or more Investment Managers appointed
      pursuant to Section 5.16. Notwithstanding the foregoing, Matching
      Contributions shall be invested in Company Stock except to the extent
      invested pursuant to Section 5.6(e).


                                       30
<PAGE>

            (b) The Committee may establish separate investment funds under the
      Plan, with each fund representing an investment alternative available to
      Participants for the investment of their Accounts as provided in Section
      5.6(c) and (d) below. Each Participant shall have a subaccount under the
      Plan corresponding to the Participant's interest which is allocated to
      each investment fund. Each such subaccount may be valued separately. The
      Committee may, at its discretion, establish alternative investment funds
      or eliminate any previously established funds, including but not limited
      to the following types of investment funds:

                  (i) The Interest Income Fund investing in group annuity
            contracts with major insurance companies.

                  (ii) The Balanced Fund investing in common stocks, bonds,
            government securities and similar types of investments.

                  (iii) The Equity Fund investing in a mutual fund which may
            invest in equity securities, bonds, preferred stocks, and
            interest-bearing cash investments.

                  (iv) The Company Stock Fund consisting exclusively of Company
            Stock.

            Notwithstanding the establishment of separate investment funds, up
      to one hundred percent (100%) of the assets of the Plan may be invested in
      Company Stock.

            (c) A Participant may elect the investment fund to which his or her
      Participant Deposits or Retirement Contributions are invested under the
      Plan or may change such elections at any time; provided, however, that any
      allocations among the investment funds shall be made in 1% increments. Any
      change in investment funds shall be effective as soon as administratively
      feasible. Any investment elections shall be limited to the investment
      funds currently offered and currently available to Participants as
      determined by the Committee pursuant to paragraphs (a) and (b) above. A
      Participant shall effect an investment election by properly completing and
      submitting the form authorized by the Committee for this purpose.

            (d) A Participant may elect at any time to transfer amounts
      accumulated in his or her Accounts among any of the investment funds
      currently offered and currently available to Participants as determined by
      the Committee pursuant to paragraphs (a) and (b) above; provided, however,
      the total amount transferred shall be made in 1% increments of the amount
      accumulated in the investment fund. Any transfer among investment funds
      shall be effective as soon as administratively feasible. A Participant
      shall effect a transfer election by properly completing and submitting the
      form authorized by the Committee for this purpose.

            (e) Notwithstanding the requirement of paragraph (a) above that
      Matching Contributions be invested in the Company Stock Fund, (i) any
      Participant may elect that amounts accumulated in his or her Matching
      Contributions Account which are held in the


                                       31
<PAGE>

      Company Stock Fund be reinvested and (ii) any Participant on or after the
      date he or she attains age 55 may elect that any future Matching
      Contributions be invested, in any of the investment funds currently
      offered and currently available to Participants as determined by the
      Committee pursuant to paragraphs (a) and (b) above. An election made under
      this paragraph (e) shall be effective as soon as administratively
      feasible. A Participant shall make any election, and may change any
      election, at such times and in accordance with the requirements imposed by
      paragraphs (c) and (d) above.

            (f) Amounts invested in any one of the investment funds shall not
      share in gains and losses experienced by any other fund.

            (g) Notwithstanding the establishment of separate investment funds
      within the Trust, the Trust shall at all times constitute a single trust.

            (h) Notwithstanding anything to the contrary in this Section 5.6 or
      Section 4.1 or Section 8.1, the following additional transfer and
      withdrawal restrictions shall apply to all Participants who are Insiders.
      For the purpose of this Section 5.6, the term "Insider" shall mean any
      Participant who is directly or indirectly the beneficial owner of more
      than 10% of any class of any equity security (other than an exempted
      security) of the Sponsor (or the Company) which is registered pursuant to
      Section 12 of the Securities Exchange Act of 1934 (the "Exchange Act") or
      who is a "director" or an "officer" of the Sponsor or the Company as those
      terms are interpreted for the purpose of determining persons subject to
      Section 16 of the Exchange Act.

                  (i) Any Insider who transfers amounts invested in the Company
            Stock Fund out of such fund and into another fund or withdraws cash
            in a transaction that results in the liquidation of amounts in the
            Company Stock Fund (pursuant to Sections 8.1 or 8.13), may not for a
            period of six months following the Participant's election to so
            transfer funds, withdraw cash or take a loan, as the case may be,
            make an election to transfer amounts from another fund into the
            Company Stock Fund.

                  (ii) Any Insider who transfers amounts invested in a fund
            other than the Company Stock Fund into the Company Stock Fund, may
            not for a period of six months following the Participant's election
            to so transfer funds make an election to (1) transfer amounts from
            the Company Stock Fund into another fund, (2) withdraw cash or take
            a loan in a transaction that results in the liquidation of amounts
            in the Company Stock Fund or (3) utilize the diversification rule of
            Section 5.12 of the Allergan Inc. Employee Stock Ownership Plan or
            the provision of any Company plan covered by Rule 16b-3 (promulgated
            pursuant to the Exchange Act) then in existence that would result in
            the transfer out of a Company equity securities fund.

            (i) It is intended that to the extent a Participant may direct the
      investment of his or her Accounts under the Plan that the Plan constitute
      a plan described in Section 404(c) of ERISA and the regulations
      thereunder, and neither the Company,


                                       32
<PAGE>

      Committee, nor any fiduciary with respect to the Plan who is employed by
      the Company shall be liable for investment losses sustained by any
      Participant or Beneficiary as a direct and necessary result of the
      investment instructions given by such Participant or Beneficiary. Such
      fiduciaries set forth in the preceding sentence shall be under no duty to
      question the investment direction of the Participant or Beneficiary or to
      advise a Participant or Beneficiary as to the manner in which his or her
      Accounts is to be invested. The fact that an investment option is offered
      shall not be construed to be a recommendation of investment.

      5.7 Irrevocability. The Company shall have no right or title to, nor
interest in, the contributions made to the Trust Fund, and no part of the Trust
Fund shall revert to the Company except that on or after the Original Effective
Date funds may be returned to the Company as follows:

            (a) In the case of Company Contributions which are made by a mistake
      of fact and at the Sponsor's written request, such contributions shall be
      returned to the Company as directed by the Sponsor within one (1) year
      after it is made.

            (b) All Company Contributions contributed to the Trust are hereby
      conditioned upon the Plan satisfying all of the requirements of Code
      Section 401(a). If the Plan does not qualify, the Plan may be revoked at
      the Sponsor's written election and all such contributions shall be
      returned to the Company as directed by the Sponsor within one year after
      the date of Internal Revenue Service denial of the qualification of the
      Plan. Upon such a revocation the affairs of the Plan and Trust shall be
      terminated and wound up as the Sponsor shall direct.

            (c) All Company Contributions to the Plan are conditioned upon the
      deductibility of those contributions under Code Section 404. To the extent
      a deduction is disallowed and at the Sponsor's written request, such
      contributions shall be returned to the Company as directed by the Sponsor
      within one year after the disallowance.

            (d) In the event that the Plan is terminated when there are amounts
      remaining in the Suspense Account, the excess funds shall revert to the
      Company as directed by the Sponsor to the extent provided in Section 13.6.

      5.8 Company, Committee and Trustee Not Responsible for Adequacy of Trust
Fund.

            (a) The Company, Committee, and the Trustee shall not be liable or
      responsible for the adequacy of the Trust Fund to meet and discharge any
      or all payments and liabilities hereunder. All Plan benefits will be paid
      only from the Trust assets, and neither the Company, the Committee nor the
      Trustee shall have any duty or liability to furnish the Trust with any
      funds, securities or other assets except as expressly provided in the
      Plan.

            (b) Except as required under the Plan or Trust or under Part 4 of
      Subtitle B of Title I of ERISA, the Company shall not be responsible for
      any decision, act or omission of the Trustee, the Committee, or the
      Investment Manager (if applicable), and shall not be


                                       33
<PAGE>

      responsible for the application of any moneys, securities, investments or
      other property paid or delivered to the Trustee.

      5.9 Certain Offers for Company Stock. Notwithstanding any other provision
of the Plan to the contrary, in the event an offer shall be received by the
Trustee (including but not limited to a tender offer or exchange offer within
the meaning of the Securities Exchange Act of 1934, as from time to time amended
and in effect) to acquire any or all shares of Company Stock held by the Trust
(an "Offer"), the discretion or authority to sell, exchange or transfer any of
such shares of Company Stock shall be determined in accordance with the
following rules:

            (a) The Trustee shall have no discretion or authority to sell,
      exchange or transfer any Company Stock pursuant to an Offer except to the
      extent, and only to the extent, that the Trustee is timely directed to do
      so in writing by each Participant with respect to shares of Company Stock
      that are allocated to such Participant's Accounts.

            (b) To the extent there remains any residual fiduciary
      responsibility with respect to Company Stock pursuant to an Offer after
      application of paragraph (a) above, the Trustee shall sell, exchange or
      transfer such Company Stock as directed by the Committee or as directed by
      an independent fiduciary if duly appointed by the Sponsor. To the extent
      the Committee or an independent fiduciary is required to exercise any
      residual fiduciary responsibility with respect to an Offer, the Committee
      or independent fiduciary shall take into account in exercising its
      fiduciary judgment, unless it is clearly imprudent to do so, directions
      timely received from Participants, as such directions are most indicative
      of what action is in the best interests of Participants. Further, the
      Committee or independent fiduciary, in addition to taking into
      consideration any relevant financial factors bearing on any such decision,
      shall take into consideration any relevant non-financial factors,
      including, but not limited to, the continuing job security of Participants
      as employees of the Sponsor or any Affiliated Company, conditions of
      employment, employment opportunities and other similar matters, and the
      prospect of the Participants and prospective Participants for future
      benefits under the Plan.

            (c) Upon timely receipt of such instructions, the Trustee shall,
      subject to the provisions of paragraphs (e) and (o) of this Section, sell,
      exchange or transfer pursuant to such Offer, only such shares as to which
      such instructions were given. The Committee shall use its best efforts to
      communicate or cause to be communicated to each Participant the
      consequences of any failure to provide timely instructions to the Trustee.

            (d) In the event, under the terms of an Offer or otherwise, any
      shares of Company Stock tendered for sale, exchange or transfer pursuant
      to such Offer may be withdrawn from such Offer, the Trustee shall follow
      such instructions respecting the withdrawal of such shares from such Offer
      in the same manner and the same proportion as shall be timely received by
      the Trustee from the Participants entitled under this paragraph (a) to
      give instructions as to the sale, exchange or transfer of shares pursuant
      to such Offer.


                                       34
<PAGE>

            (e) In the event that an Offer for fewer than all of the shares of
      Company Stock held by the Trustee in the Trust shall be received by the
      Trustee, each Participant shall be entitled to direct the Trustee as to
      the acceptance or rejection of such Offer (as set forth herein) with
      respect to the largest portion of such Company Stock as may be possible
      given the total number or amount of shares of Company Stock the Plan may
      sell, exchange or transfer pursuant to the Offer based upon the
      instructions received by the Trustee from all other Participants who shall
      timely instruct the Trustee pursuant to this paragraph to sell, exchange
      or transfer such shares pursuant to such Offer, each on a pro rata basis
      in accordance with the maximum number of shares each such Participant
      would have been permitted to direct under paragraph (a) had the Offer been
      for all shares of Company Stock held in the Trust.

            (f) In the event an Offer is received by the Trustee and
      instructions have been solicited from Participants regarding such Offer,
      and prior to termination of such Offer, another Offer is received by the
      Trustee for the Company Stock subject to the first Offer, the Trustee
      shall inform the Committee of such other Offer and the Committee shall use
      its best efforts under the circumstances to solicit instructions from the
      Participants (i) with respect to securities tendered for sale, exchange or
      transfer pursuant to the first Offer, whether to withdraw such tender, if
      possible, and, if withdrawn, whether to tender any Company Stock so
      withdrawn for sale, exchange or transfer pursuant to the second Offer and
      (ii) with respect to Company Stock not tendered for sale, exchange or
      transfer pursuant to the first Offer, whether to tender or not to tender
      such Company Stock for sale, exchange or transfer pursuant to the second
      Offer. The Trustee shall follow all such instructions received in a timely
      manner from Participants in the same manner and in the same proportion as
      provided in paragraph (a) of this Section. With respect to any further
      Offer for any Company Stock received by the Trustee and subject to any
      earlier Offer (including successive Offers from one or more existing
      offers), the Trustee shall act in the same manner as described above.

            (g) With respect to any Offer received by the Trustee, the Trustee
      shall inform the Sponsor of such Offer and the Sponsor shall distribute,
      at its expense, copies of all relevant material including but not limited
      to material filed with the Securities and Exchange Commission with such
      Offer or regarding such Offer, which shall seek confidential written
      instructions from each Participant who is entitled to respond to such
      Offer pursuant to paragraph (a). The identities of Participants, the
      amount of Company Stock allocated to their Accounts, and the Compensation
      of each Participant shall be determined from the list of Participants
      delivered to the Sponsor by the Committee which shall take all reasonable
      steps necessary to provide the Sponsor with the latest possible
      information.

            (h) The Sponsor shall distribute and/or make available to each
      Participant who is entitled to respond to an Offer pursuant to paragraph
      (a), an instruction form to be used by each such Participant who wishes to
      instruct the Trustee. The instruction form shall state that (i) if the
      Participant fails to return an instruction form to the Trustee by the
      indicated deadline, the Company Stock with respect to which he or she is
      entitled to give instructions shall not be sold, exchanged or transferred
      pursuant to such Offer, (ii) the


                                       35
<PAGE>

      Participant shall be a named fiduciary (as described in paragraph (m)
      below) with respect to all shares of Company Stock for which he or she is
      entitled to give instructions, and (iii) the Company acknowledges and
      agrees to honor the confidentiality of the Participant's instructions to
      the Trustee.

            (i) Each Participant may choose to instruct the Trustee in one of
      the following two ways: (i) not to sell, exchange or transfer any shares
      of Company Stock for which he or she is entitled to give instructions, or
      (ii) to sell, exchange or transfer all Company Stock for which he or she
      is entitled to give instructions. The Sponsor shall follow up with
      additional mailings and postings of bulletins, as reasonable under the
      time constraints then prevailing, to obtain instructions from Participants
      not otherwise responding to such requests for instructions. Subject to
      paragraph (e), the Trustee shall then sell, exchange or transfer shares
      according to instructions from Participants, except that shares for which
      no instructions are received shall not be sold, exchanged or transferred
      unless directed otherwise as provided in paragraph (b) above.

            (j) The Sponsor shall furnish former Participants who have received
      distributions of Company Stock so recently as to not be shareholders of
      record with the information given to Participants pursuant to paragraphs
      (g), (h) and (i) of this Section. The Trustee shall then sell, exchange or
      transfer shares according to instructions from such former Participants,
      except that shares for which no instructions are received shall not be
      sold, exchanged or transferred.

            (k) Neither the Company, the Committee nor the Trustee shall express
      any opinion or give any advice or recommendation to any Participant
      concerning the Offer, nor shall they have any authority or responsibility
      to do so.

            (l) The Trustee shall not reveal or release a Participant's
      instructions to the Company, its officers, directors, employees, or
      representatives. If some but not all Company Stock held by the Trust is
      sold, exchanged, or transferred pursuant to an Offer, the Company, with
      the Trustee's cooperation, shall take such action as is necessary to
      maintain the confidentiality of Participant's records including, without
      limitation, establishment of a security system and procedures which
      restrict access to Participant records and retention of an independent
      agent to maintain such records. If an independent record keeping agent is
      retained, such agent must agree, as a condition of its retention by the
      Sponsor, not to disclose the composition of any Participant Accounts to
      the Company, its officers, directors, employees, or representatives. The
      Company acknowledges and agrees to honor the confidentiality of
      Participants' instructions to the Trustee.

            (m) Each Participant shall be a named fiduciary (as that term is
      defined in Section 402(a)(2) of ERISA) with respect to Company Stock
      allocated to his or her Accounts under the Plan solely for purposes of
      exercising the rights of a shareholder with respect to an Offer pursuant
      to this Section 5.9 and voting rights pursuant to Section 5.10.


                                       36
<PAGE>

            (n) To the extent that an Offer results in the sale of Company Stock
      in the Trust, the Committee or the Participants, if so permitted under the
      terms of the Plan, shall instruct the Trustee as to the investment of the
      proceeds of such sale.

            (o) In the event a court of competent jurisdiction shall issue to
      the Plan, the Committee, the Sponsor or the Trustee an opinion or order,
      which shall, in the opinion of counsel to the Committee, the Sponsor or
      the Trustee, invalidate, in all circumstances or in any particular
      circumstances, any provision or provisions of this Section regarding the
      determination to be made as to whether or not Company Stock held by the
      Trustee shall be sold, exchanged or transferred pursuant to an Offer or
      cause any such provision or provisions to conflict with securities laws,
      then, upon notice thereof to the Committee, the Sponsor or the Trustee, as
      the case may be, such invalid or conflicting provisions of this Section
      shall be given no further force or effect. In such circumstances, the
      Trustee shall continue to follow instructions received from Participants,
      to the extent such instructions have not been invalidated by such order or
      opinion. To the extent the Trustee is required by such opinion or order to
      exercise any residual fiduciary responsibility with respect to such Offer,
      the Sponsor shall appoint an independent fiduciary who shall exercise such
      residual fiduciary responsibility as provided in paragraph (b) above and
      shall direct the Trustee as to whether or not Company Stock held by the
      Trustee shall be sold, exchanged or transferred pursuant to such Offer.

      5.10 Voting of Company Stock. Notwithstanding any other provision of the
Plan to the contrary, the Trustee shall have no discretion or authority to vote
Company Stock held in the Trust on any matter presented for a vote by the
stockholders of the Company except in accordance with timely directions received
by the Trustee from either the Committee or Participants, depending on who has
the right to direct the voting of such Company Stock as provided in the
following provisions of this Section 5.10.

            (a) All Company Stock held in the Trust Fund shall be voted by the
      Trustee as the Committee directs in its absolute discretion, except as
      provided in this Section 5.10(a).

                  (i) If the Sponsor has a registration-type class of securities
            (as defined in Code Section 409(e)(4)), then with respect to all
            corporate matters, each Participant shall be entitled to direct the
            Trustee as to the voting of all Company Stock allocated and credited
            to his or her Accounts.

                  (ii) If the Sponsor does not have a registration-type class of
            securities, then only with respect to such matters as the approval
            or disapproval of any corporate merger or consolidation,
            recapitalization, reclassification, liquidation, dissolution, sale
            of substantially all assets of trade or business, or such similar
            transactions as may be prescribed in Code Section 409(e)(4) and the
            regulations thereunder, each Participant shall be entitled to direct
            the Trustee as to the voting of all Company Stock allocated and
            credited to his or her Accounts.


                                       37
<PAGE>

            (b) To the extent there remains any residual fiduciary
      responsibility with respect to the voting of Company Stock after
      application of paragraph (a) above, the Trustee shall vote such Company
      Stock as directed by the Committee or as directed by an independent
      fiduciary if duly appointed by the Sponsor. To the extent the Committee or
      an independent fiduciary is required to exercise any residual fiduciary
      responsibility with respect to the voting of Company Stock, the Committee
      or independent fiduciary shall take into account in exercising its
      fiduciary judgment, unless it is clearly imprudent to do so, directions
      timely received from Participants, as such directions are most indicative
      of what action is in the best interests of Participants. Further, the
      Committee or independent fiduciary, in addition to taking into
      consideration any relevant financial factors bearing on any such decision,
      shall take into consideration any relevant non-financial factors,
      including, but not limited to, the continuing job security of Participants
      as employees of the Sponsor or any Affiliated Company, conditions of
      employment, employment opportunities and other similar matters, and the
      prospect of the Participants and prospective Participants for future
      benefits under the Plan.

            (c) All Participants entitled to direct such voting shall be
      notified by the Sponsor, pursuant to its normal communications with
      shareholders, of each occasion for the exercise of such voting rights
      within a reasonable time before such rights are to be exercised. Such
      notification shall include all information distributed to shareholders
      either by the Sponsor or any other party regarding the exercise of such
      rights. Such Participants shall be so entitled to direct the voting of
      fractional shares (or fractional interests in shares), provided, however,
      that the Trustee may, to the extent possible, vote the combined fractional
      shares (or fractional interests in shares) so as to reflect the aggregate
      direction of all Participants giving directions with respect to fractional
      shares (or fractional interests in shares). To the extent that a
      Participant shall fail to direct the Trustee as to the exercise of voting
      rights arising under any Company Stock credited to his or her Accounts,
      such Company Stock shall not be voted unless the Trustee is directed
      otherwise as provided in paragraph (b) above. The Trustee shall maintain
      confidentiality with respect to the voting directions of all Participants.

            (d) Each Participant shall be a named fiduciary (as that term is
      defined in Section 402(a)(2) of ERISA) with respect to Company Stock for
      which he or she has the right to direct the voting under the Plan but
      solely for the purpose of exercising voting rights pursuant to this
      Section 5.10 or certain Offers pursuant to Section 5.9.

            (e) In the event a court of competent jurisdiction shall issue an
      opinion or order to the Plan, the Committee, the Sponsor or the Trustee,
      which shall, in the opinion of counsel to the Committee, the Sponsor or
      the Trustee, invalidate under ERISA, in all circumstances or in any
      particular circumstances, any provision or provisions of this Section
      regarding the manner in which Company Stock held in the Trust shall be
      voted or cause any such provision or provisions to conflict with ERISA,
      then, upon notice thereof to the Committee, the Sponsor or the Trustee, as
      the case may be, such invalid or conflicting provisions of this Section
      shall be given no further force or effect. In such circumstances the
      Trustee shall continue to follow instructions received from Participants,
      to the extent such instructions have not been invalidated by such order or


                                       38
<PAGE>

      opinion. To the extent the Trustee is required by such opinion or order to
      exercise any residual fiduciary responsibility with respect to voting, the
      Sponsor shall appoint an independent fiduciary who shall exercise such
      residual fiduciary responsibility as provided in paragraph (b) above and
      shall direct the Trustee as to the manner in which Company Stock held by
      the Trustee shall be voted.

      5.11 Securities Law Limitation. Neither the Committee nor the Trustee
shall be required to engage in any transaction, including without limitation,
directing the purchase or sale of Company Stock, which either determines in its
sole discretion might tend to subject itself, its members, the Plan, the
Company, or any Participant or Beneficiary to a liability under federal or state
securities laws.

      5.12 Distributions. Money and property of the Trust shall be paid out,
disbursed, or applied by the Trustee for the benefit of Participants and
Beneficiaries under the Plan in accordance with directions received by the
Trustee from the Committee. Upon direction of the Committee, the Trustee may pay
money or deliver property from the Trust for any purpose authorized under the
Plan. The Trustee shall be fully protected in paying out money or delivering
property from the Trust from time to time upon written order of the Committee
and shall not be liable for the application of such money or property by the
Committee. The Trustee shall not be required to determine or to make any
investigation to determine the identity or mailing address of any person
entitled to benefits hereunder and shall have discharged its obligation in that
respect when it shall have sent checks or other property by first-class mail to
such persons at their respective addresses as may be certified to it by the
Committee.

      5.13 Taxes. If the whole or any part of the Trust, or the proceeds
thereof, shall become liable for the payment of any estate, inheritance, income
or other tax, charge, or assessment which the Trustee shall be required to pay,
the Trustee shall have full power and authority to pay such tax, charge, or
assessment out of any moneys or other property in its hands for the account of
the person whose interests hereunder are so liable, but at least ten (10) days
prior to making any such payment, the Trustee shall mail notice to the Committee
of its intention to make such payment. Prior to making any transfers or
distributions of any of the Trust, the Trustee may require such releases or
other documents from any lawful taxing authority as it shall deem necessary.

      5.14 Trustee Records to be Maintained. The Trustee shall keep accurate and
detailed accounts of all investments, receipts, disbursements, and other
transactions hereunder, and all accounts, books, and records relating thereto
shall be open to inspection and audit at all reasonable times by any person
designated by the Company (subject to the provisions of Sections 5.9(l) and
5.10(c)).

      5.15 Annual Report of Trustee. Promptly following the close of each Plan
Year (or such other period as may be agreed upon between the Trustee and
Committee), or promptly after receipt of a written request from the Company, the
Trustee shall prepare for the Company a written account which will enable the
Company to satisfy the annual financial reporting requirements of ERISA, and
which will set forth among other things all investments, receipts,
disbursements, and other transactions effected by the Trustee during such Plan
Year or during


                                       39
<PAGE>

the period from the close of the last Plan Year to the date of such request.
Such account shall also describe all securities and other investments purchased
and sold during the period to which it refers, the cost of acquisition or net
proceeds of sale, the securities and investments held as of the date of such
account, and the cost of each item thereof as carried on the books of the
Trustee. All accounts so filed shall be open to inspection during business hours
by the Company, the Committee, and by Participants and Beneficiaries of the Plan
(subject to the provisions of Sections 5.9(l) and 5.10(c)).

      5.16 Appointment of Investment Manager. From time to time the Committee,
in accordance with Section 9.6 hereof, may appoint one or more Investment
Managers who shall have investment management and control over assets of the
Trust not invested or to be invested in Company Stock. The Committee shall
notify the Trustee of such assets of the appointment of the Investment Manager.
In the event more than one Investment Manager is appointed, the Committee shall
determine which assets shall be subject to management and control by each
Investment Manager and shall also determine the proportion in which funds
withdrawn or disbursed shall be charged against the assets subject to each
Investment Manager's management and control. As shall be provided in any
contract between an Investment Manager and the Committee, such Investment
Manager shall hold a revocable proxy with respect to all securities which are
held under the management of such Investment Manager pursuant to such contract
(except for Company Stock), and such Investment Manager shall report the voting
of all securities subject to such proxy on an annual basis to the Committee.


                                       40
<PAGE>

                                   ARTICLE VI
                            ACCOUNTS AND ALLOCATIONS

      6.1 Participants' Accounts. In order to account for the allocated interest
of each Participant in the Trust Fund, there shall be established and maintained
for each Participant (making such form of contribution) a Before Tax Deposits
Account, an After Tax Deposits Account, a Matching Contributions Account, a
Retirement Contributions Account, and a Rollover Contributions Account.

      6.2 Allocation of Participant Deposits. All Participant Deposits shall be
allocated to the separate Accounts established and maintained for that
Participant. Participant Deposits shall be paid by the Company to the Trustee as
soon as the amount can reasonably be identified and separated from the Company's
other assets, but in any event no later than the 15th business day of the month
following the month in which such amounts would otherwise be payable to the
Participant, or such other time provided in applicable regulations under the
Code or ERISA.

      6.3 Allocation of Company Contributions and Forfeitures. Company
Contributions and Forfeitures shall be allocated as follows:

            (a) Matching Contributions shall be allocated to the Matching
      Contributions Accounts of all Participants who made Matched Deposits in
      such amounts and at such times as provided in Sections 5.3(a) and 5.3(b).

            (b) Retirement Contributions shall be allocated to the Retirement
      Contributions Accounts of all Retirement Account Participants in such
      amounts and at such times as provided in Sections 5.4(a) and 5.4(b).

            (c) Matching Contribution Forfeitures shall first be used to restore
      the Matching Contributions Accounts of rehired Participants if so required
      under Section 8.7 and shall then be allocated to the Matching
      Contributions Accounts of Participants to the extent necessary to correct
      insufficient allocations made to such Accounts in prior months discovered
      during the Plan Year to which such Forfeitures are attributable. Any
      remaining Matching Contribution Forfeitures may be applied towards plan
      expenses if so directed by the Committee as provided in Section 9.12 or
      shall be used to reduce Matching Contributions made by the Company
      pursuant to Section 5.3.

            (d) Retirement Contribution Forfeitures shall first be used to
      restore the Retirement Contributions Accounts of rehired Retirement
      Account Participants if so required under Section 8.7 and shall then be
      allocated to the Retirement Contributions Accounts of Retirement Account
      Participants to the extent necessary to correct insufficient allocations
      made to such Accounts in prior months discovered during the Plan Year to
      which such Forfeitures are attributable. Any remaining Retirement
      Contribution Forfeitures may be applied towards plan expenses if so
      directed by the Committee as provided in Section 9.12 or shall be used to
      reduce Retirement Contributions made by the Company pursuant to Section
      5.4.


                                       41
<PAGE>

            (e) Any other Company Contributions shall be used to restore the
      Accounts of rehired Participants if so required under Section 8.7 and to
      the extent Forfeitures are unavailable. Any amounts remaining may be used
      to pay Plan expenses if so directed by the Committee as provided in
      Section 9.12.

      The allocations of Company Contributions under this Section 6.3 shall be
 made only after any allocations required by Sections 6.10 and 13.4 have been
 made.

      6.4 Valuation of Participants' Accounts. Within sixty (60) days after each
Valuation Date the Trustee shall value the assets of the Trust on the basis of
fair market values. Company Stock held by the Trust shall be valued in
accordance with Section 6.5. If separate investment funds are maintained under
the Trust pursuant to Section 5.6(b) then each such fund shall be valued
separately so that gains or losses of the various funds shall not be commingled.
Upon receipt of these valuations from the Trustee, the Committee shall revalue
the Accounts and subaccounts (as established pursuant to Section 5.6(b)), if
any, of each Participant as of the applicable Valuation Date so as to reflect,
among other things, a proportionate share in any increase or decrease in the
fair market value of the assets in the Trust Fund, determined by the Trustee as
of that date as compared with the value of the assets in the Trust Fund as of
the immediately preceding Valuation Date.

      6.5 Valuation of Company Stock. Company Stock held by the Trust shall be
valued according to the following rules:

            (a) In the case of Company Stock that is publicly traded on a
      national securities exchange, such stock shall be valued by reference to
      the closing price of such stock on such exchange on the last trading day
      of the month for which such stock is being valued.

            (b) In the case of Company Stock that is not publicly traded on a
      national securities exchange, such stock shall be valued as of the first
      day of each Plan Year, or such other time as established by the Committee,
      by determining the fair market value of such stock through the use of an
      independent appraiser. Such fair market valuation shall be used to
      determine the valuation of each Participant's Company Stock Account on
      each Valuation Date in such Plan Year pursuant to Section 6.4.

      6.6 Dividends, Splits, Recapitalizations, Etc. Any Company Stock received
by the Trustee as a stock split, dividend, or as a result of a reorganization or
other recapitalization of the Company shall be allocated in the same manner as
the Company Stock to which it is attributable is then allocated.

      6.7 Stock Rights, Warrants or Options.

            (a) In the event any rights, warrants, or options are issued on
      Company Stock held in the Trust Fund, the Trustee shall exercise them for
      the acquisition of additional


                                       42
<PAGE>

      Company Stock as directed by the Committee to the extent that cash is then
      available in the Trust Fund.

            (b) Any Company Stock acquired in this fashion shall be treated as
      Company Stock purchased by the Trustee for the net price paid and shall be
      allocated in the same manner as the funds used to purchase the Company
      Stock were or would be allocated under the provisions of the Plan. Thus,
      if the funds used to purchase the stock consisted of unallocated Company
      Contributions, the stock would be allocated under the terms of Section
      6.3; if the funds used consisted of the unallocated net income of the
      Trust, the stock would be allocated as provided in Section 6.4; and if the
      funds used consisted of funds previously allocated to the Accounts, the
      stock would be allocated in the manner in which the Accounts or
      subaccounts are debited and credited.

            (c) Any rights, warrants, or options on Company Stock which cannot
      be exercised for lack of cash may, as directed by the Committee, be sold
      by the Trustee and the proceeds allocated in accordance with the source of
      the Company Stock with respect to which the rights, warrants, or options
      were issued in accordance with rules of paragraph (b) above.

      6.8 Treatment of Accounts Upon Severance. Upon a Participant's Severance,
pending distribution of the Participant's benefit pursuant to the provisions of
Article VIII, the Participant's Accounts shall continue to be maintained and
accounted for in accordance with all applicable provisions of the Plan,
including but not limited to the allocation of Company Contributions and net
income or loss to which the Accounts are entitled under the applicable
provisions of Sections 6.3 and 6.4 as of any Valuation Date or other date
preceding the distribution of the Participant's entire benefit under the Plan.

      6.9 Cash Dividends.

            (a) All cash dividends paid to the Trustee with respect to Company
      Stock that has been allocated to a Participant's Account as of the
      quarterly date on which the dividend is received by the Trustee shall be
      allocated to the Participant's Account.

            (b) If a Participant (or Beneficiary) has a current right to a
      distribution in Company Stock pursuant to Article VIII and such stock has
      not yet been re-registered in the name of the Participant (or Beneficiary)
      as of the record date of any dividend on such stock, such dividend shall
      be distributed to the Participant (or Beneficiary).

            (c) Notwithstanding the provisions of paragraphs (a) and (b) above,
      the Committee may determine, in its discretion, that cash dividends on
      such shares may be used to purchase additional shares of Company Stock, or
      in whatever other manner it deems appropriate.

      6.10 Miscellaneous Allocation Rules.


                                       43
<PAGE>

            (a) In the event that there is more than one class of Company Stock
      to be allocated to Participants' Accounts, there shall be allocated to the
      Account of each Participant (entitled to share in allocations of Company
      Stock as of any applicable date) the portion of each class of Company
      Stock (to be allocated as of that date) which the amount to be allocated
      to the Account of the Participant bears to the total amount to be
      allocated to the Accounts of all Participants entitled to share in such
      allocation.

            (b) Allocations of all assets other than Company Stock shall be made
      on the basis of, and expressed in terms of dollar value. Allocations of
      Company Stock shall be on the basis of the number of shares of Company
      Stock (including fractional shares) and valuations, as of each Valuation
      Date, shall be expressed in terms of number of shares and dollar value.

            (c) The Committee and the Trustee shall establish such additional
      accounting procedures as may be necessary for the purpose of making the
      allocations, valuations, withdrawals, and adjustments to Participants'
      Accounts provided for in this Article VI. From time to time the Committee
      and Trustee may modify such additional accounting procedures for the
      purpose of achieving equitable, nondiscriminatory, and administratively
      feasible allocations among the Accounts of Participants in accordance with
      the general concepts of the Plan and the provisions of this Article VI.

            (d) The Company, the Committee and Trustee do not in any manner or
      to any extent whatsoever warrant, guarantee or represent that the value of
      a Participant's Account shall at any time equal or exceed the amount
      previously contributed thereto.

      6.11 Limitations on After Tax Deposits and Matching Contributions. With
respect to each Plan Year, After Tax Deposits and Matching Contributions under
the Plan for the Plan Year shall not exceed the limitations by or on behalf of
Highly Compensated Participants under Code Section 401(m), as provided in this
Section. In the event that After Tax Deposits and Matching Contributions under
the Plan by or on behalf of Highly Compensated Participants for any Plan Year
exceed the limitations of this Section for any reason, such excess After Tax
Deposits and Matching Contributions and any income or loss allocable thereto
shall be disposed of in accordance with Section 6.12.

            (a) The After Tax Deposits by Participants and Matching
      Contributions on behalf of Participants for a Plan Year shall satisfy the
      Actual Contribution Percentage test set forth in (i) below, or, to the
      extent not precluded by applicable regulations, the alternative Actual
      Contribution Percentage test set forth in (ii) below:

                  (i) The Actual Contribution Percentage of Highly Compensated
            Participants for the Plan Year shall not be more than the prior Plan
            Year's Actual Contribution Percentage of Participants who were not
            Highly Compensated Employees for the prior Plan Year multiplied by
            1.25, or

                  (ii) The Actual Contribution Percentage of Highly Compensated
            Participants for the Plan Year shall not be more than the prior Plan
            Year's Actual


                                       44
<PAGE>

            Contribution Percentage of Participants who were not Highly
            Compensated Employees for the prior Plan Year multiplied by 2.0,
            provided that the Actual Contribution Percentage of Highly
            Compensated Participants does not exceed the Actual Contribution
            Percentage of Participants who were not Highly Compensated Employees
            for the prior Plan Year by more than two (2) percentage points.

                  (iii) If one or more Highly Compensated Employees participate
            in both a cash or deferred arrangement and a plan subject to the
            Actual Contribution Percentage test maintained by the Sponsor or an
            Affiliated Company and the sum of the Actual Deferral Percentage and
            Contribution Percentage of those Highly Compensated Employees
            subject to either or both test exceeds the Aggregate Limit, then the
            Contribution Percentages of those Highly Compensated Employees who
            also participate in the cash or deferred arrangement shall be
            reduced (beginning with such Highly Compensated Employee whose
            Actual Contribution Percentage is the highest) so that the limit is
            not exceeded. The amount by which each Highly Compensated Employee's
            Contribution Percentage is reduced shall be treated as an Excess
            Aggregate Contribution. The Actual Deferral Percentage and
            Contribution Percentage of the Highly Compensated Employee are
            determined after any corrections required to meet the Actual
            Deferral Percentage and Actual Contribution Percentage tests and are
            deemed to be the maximum permitted under such tests for the Plan
            Year.

            (b) For purposes of this Section 6.11 and Section 6.12 the following
      definitions shall apply:

                  (i) "Actual Contribution Percentage" shall mean the average of
            the Contribution Percentages, with respect to the group of Highly
            Compensated Participants and the group of all other Participants for
            a Plan Year. The "Contribution Percentage" for any Participant shall
            mean the ratio, calculated separately and to the nearest
            one-hundredth of one percent for each Participant in such group,
            determined as follows:

                        (1) For a Highly Compensated Participant, the ratio of
                  such Participant's After Tax Deposits and Matching
                  Contributions for the current Plan Year to such Participant's
                  Compensation for the current Plan Year; provided, however,
                  that the Contribution Percentage of a Highly Compensated
                  Participant with no After Tax Deposits and Matching
                  Contributions made on his or her behalf shall be zero.

                        (2) For any other Participant, the ratio of such
                  Participant's After Tax Deposits and Matching Contributions
                  for the preceding Plan Year to such Participant's Compensation
                  for the preceding Plan Year; provided, however, that the
                  Contribution Percentage of a Participant with no After Tax
                  Deposits and Matching Contributions made on his or her behalf
                  shall be zero.


                                       45
<PAGE>

                  The Contribution Percentage, in each case, however, shall not
            include Matching Contributions that are forfeited either to correct
            Excess Aggregate Contributions or because the contribution to which
            they relate are excess Before Tax Deposits, excess After Tax
            Deposits, or Excess Aggregate Contributions. To the extent
            determined by the Committee and in accordance with regulations
            issued by the Secretary of the Treasury under Code Section
            401(m)(3), Before Tax Deposits and any qualified nonelective
            contributions, within the meaning of Code Section 401(m)(4)(C) on
            behalf of a Participant may also be taken into account for purposes
            of calculating the Contribution Percentage of a Participant.
            However, if any Before Tax Deposits are taken into account for
            purposes of determining Actual Deferral Percentages under Section
            4.3 then such Before Tax Deposits shall not be taken into account
            under this Section 6.11.

                  (ii) "Highly Compensated Participant" shall mean for any Plan
            Year any Participant who is a Highly Compensated Employee. A
            Participant is a Highly Compensated Employee for a particular Plan
            Year if he or she meets the definition of a Highly Compensated
            Employee in effect for that Plan Year. Similarly, a Participant is
            not a Highly Compensated Employee for a particular Plan Year if he
            or she does not meet the definition of a Highly Compensated Employee
            in effect for that Plan Year.

                  (iii) "Participant" shall mean any Eligible Employee who
            satisfied the requirements of Section 3.1 during the Plan Year
            whether or not such Eligible Employee has elected to contribute to
            the Plan for such Plan Year.

                  (iv) "Compensation" shall mean compensation as described
            below:

                        (1) Compensation means compensation determined by the
                  Company in accordance with the requirements of Code Section
                  414(s) and the regulations thereunder.

                        (2) For purposes of this Section 6.11, Compensation may,
                  at the Company's election, exclude amounts which are
                  excludable from a Participant's gross income under Code
                  Section 125 (pertaining to cafeteria plans) and Code Section
                  402(e)(3) (pertaining to 401(k) salary reductions). The
                  Company may change its election provided such change does not
                  discriminate in favor of Highly Compensated Employees.

                        (3) Compensation taken into account for any Plan Year
                  shall not exceed $200,000, as adjusted for cost-of-living
                  increases in accordance with Code Section 401(a)(17)(B). Any
                  cost-of-living adjustments in effect for a calendar year shall
                  apply to the Plan Year beginning with or within such calendar
                  year.


                                       46
<PAGE>

                  (v) "Aggregate Limit" shall mean the sum of (1) 125 percent of
            the greater of the average Actual Deferral Percentage of all
            Non-Highly Compensated Participants for the Plan Year or the Actual
            Contribution Percentage of Non-Highly Compensated Participants under
            the Plan subject to Code Section 401(m) for the Plan Year beginning
            with or within the Plan Year of the cash or deferred arrangement and
            (2) the lesser of 200% or two plus the lesser of such average Actual
            Deferral Percentage or Actual Contribution Percentage. "Lesser" is
            substituted for "greater" in (1) above, and "greater" is substituted
            for "lesser" after "two plus the" in (2) above if it would result in
            a larger Aggregate Limit.

                  (vi) "Excess Aggregate Contributions" shall mean, with respect
            to any Plan Year, the excess of:

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

                        (2) The maximum After Tax Deposits and Matching
                  Contributions permitted under the Actual Contribution
                  Percentage test as determined by reducing such Matching
                  Contributions made on behalf of Highly Compensated Employees
                  in order of their Contribution Percentages, beginning with the
                  highest of such percentages.

                  Such determination shall be made after first determining
            excess Before Tax Deposits pursuant to Sections 4.2(a) and 4.3.

            (c) In the event the Plan satisfies the requirements of Code
      Sections 401(m), 401(a)(4) or 410(b) only if aggregated with one or more
      other plans which include arrangements under Code Section 401(k), then
      this Section 6.11 shall be applied by determining the Contribution
      Percentages of Participants as if all such plans were a single plan. Any
      adjustments to the Contribution Percentages of Participants who are not
      Highly Compensated Employees for the prior year shall be made in
      accordance with Notice 98-1 and any superseding guidance. Plans may be
      aggregated in order to satisfy Code Section 401(m) only if they have the
      same Plan Year and use the same Actual Contribution Percentage testing
      method.

            (d) For purposes of this Section 6.11, the Contribution Percentage
      for any Highly Compensated Participants who is eligible to have After Tax
      Deposits or Matching Contributions allocated to his or her account under
      two or more plans maintained by the Sponsor or an Affiliated Company shall
      be determined as if the total of such After Tax Deposits or Matching
      Contributions was made under each plan. If a Highly Compensated Employee
      participates in two or more cash or deferred arrangements that have
      different plan years, all cash or deferred arrangements that have
      different plan years, all cash or deferred arrangements ending with or
      within the same calendar year shall be treated as a single arrangement.
      Notwithstanding the foregoing, certain plans shall be


                                       47
<PAGE>

      treated as separate plans if mandatorily disaggregated pursuant to
      regulations under Code Section 401(m).

            (e) For purposes of the Actual Contribution Percentage test, After
      Tax Deposits shall be considered to have been made in the Plan Year in
      which contributed to the Trust. Matching Contributions shall be considered
      made for a Plan Year if made no later than the end of the twelve-month
      period beginning on the day after the close of the Plan Year.

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

            (g) The Committee shall keep or cause to have kept such records as
      are necessary to demonstrate that the Plan satisfies the requirements of
      Code Section 401(m) and the regulations thereunder, in accordance with
      regulations prescribed by the Secretary of the Treasury.

      6.12 Provision for Disposition of Excess After Tax Deposits or Matching
Contributions on Behalf of Highly Compensated Participants. After application of
the provisions of Section 4.4 and 4.5, the following provisions shall be
implemented:

            (a) The Committee shall determine, as soon as is reasonably possible
      following the close of each Plan Year, the extent (if any) to which
      contributions by or on behalf of Highly Compensated Participants may cause
      the Plan to exceed the limitations of Section 6.11 for such Plan Year. If,
      pursuant to the determination by the Committee and as required by the
      leveling method described in paragraph (b) below, contributions by or on
      behalf of a Highly Compensated Participant may cause the Plan to exceed
      such limitations, then the Committee shall take the following steps:

                  (i) First, any excess After Tax Deposits that were not matched
            by Matching Contributions, together with income or loss allocable to
            such amount (determined in accordance with paragraph (c) below)
            shall be returned to the Highly Compensated Participant.

                  (ii) Second, if any excess remains after the provisions of (i)
            above are applied, to the extent necessary to eliminate the excess,
            Matching Contributions with respect to the Highly Compensated
            Participant, any corresponding matched After Tax Deposits, and any
            income or loss allocable thereto, shall either be distributed (if
            non-forfeitable) to the Highly Compensated Participant or forfeited
            (to the extent forfeitable under the Plan) on a pro-rata basis.
            Amounts of excess Matching Contributions forfeited by Highly
            Compensated Participants under this Section 6.12, including any
            income or loss allocable thereto, shall be applied to reduce
            Matching Contributions by the Company or the Affiliated Company that
            made the Matching Contribution on behalf of the Highly Compensated
            Participant for the Plan Year for which the excess contribution was
            made.


                                       48
<PAGE>

                  (iii) If administratively feasible, any amounts distributed
            pursuant to subparagraphs (i) or (ii) above shall be returned within
            two and one-half (2-1/2) months following the close of the Plan Year
            for which such excess After Tax Deposits or Matching Contributions
            were made, but in any event no later than the end of the first Plan
            Year following the Plan Year for which the excess After Tax Deposits
            or Matching Contributions were made. After Tax Deposits and Matching
            Contributions for any Plan Year shall be made on the basis of the
            respective portions of such excess After Tax Deposits and Matching
            Contributions attributable to each Highly Compensated Participant.

            (b) For purposes of satisfying the Actual Contribution Percentage
      test, the amount of any excess After Tax Deposits or Matching
      Contributions by or on behalf of Highly Compensated Participants for a
      Plan Year under Section 6.11 shall be determined by application of a
      leveling method under which the After Tax Deposits or Matching
      Contributions of the Highly Compensated Participant who has the highest
      dollar amount of After Tax Deposits or Matching Contributions for such
      Plan Year is reduced to the extent required to cause such Highly
      Compensated Participant's After Tax Deposits and Matching Contributions to
      equal the After Tax Deposits and Matching Contributions of the Highly
      Compensated Participant with the next highest After Tax Deposits and
      Matching Contributions; provided, however, if a lesser amount, when added
      to the total dollar amount already distributed under this paragraph (b),
      equals the total excess After Tax Deposits and Matching Contributions that
      are required to be distributed to enable the Plan to satisfy the Actual
      Contribution Percentage test, the lesser amount shall be distributed. This
      process shall be repeated until the Plan satisfies the Actual Contribution
      Percentage test.

            (c) The amount of income or loss attributable to any excess After
      Tax Deposits or Matching Contributions, as determined under this Section
      6.12 (the "Excess Aggregate Contribution") by a Highly Compensated
      Participant for a Plan Year shall be equal to the sum of the following:

                  (i) The income or loss allocable to the Highly Compensated
            Participant's Excess Aggregate Contribution Accounts for the Plan
            Year multiplied by a fraction, the numerator of which is the Excess
            Aggregate Contribution and the denominator of which is the sum of
            the balance of the Highly Compensated Participant's Excess Aggregate
            Contribution Accounts without regard to any income or loss allocable
            to such Accounts during the Plan Year; and

                  (ii) The amount of allocable income or loss for the Gap Period
            using the "safe harbor" method set forth in regulations prescribed
            by the Secretary of the Treasury under Code Section 401(m). Under
            the "safe harbor" method, such allocable income or loss is equal to
            10% of the amount calculated under Section 6.12(c)(i) above,
            multiplied by the number of calendar months from the last day of the
            Plan Year until the date of distribution of the Participant's excess
            After Tax Deposits or Matching Contributions. A distribution on or
            before the


                                       49
<PAGE>

            15th of the month is treated as made on the last day of the
            preceding month, a distribution after the 15th of the month is
            treated as made on the first day of the next month.

            (d) For the purpose of this Section 6.12, the following shall apply:

                  (i) "Excess Aggregate Contribution Accounts" shall mean the
            Participant's After Tax Deposits Account and Matching Contributions
            Account.

                  (ii) "Gap Period" shall mean the period between last day of
            the Plan Year and the date of distribution of any Excess Aggregate
            Contributions.

            (e) Any excess After Tax Deposits and/or Matching Contributions
      distributed to a Highly Compensated Participant or forfeited by a Highly
      Compensated Participant in accordance with this Section 6.12, shall be
      treated as Annual Additions under Article XIII for the Plan Year for which
      the excess contribution was made.

            (f) Neither the Committee nor the Company shall be liable to any
      Participant (or his or her Beneficiary, if applicable) for any losses
      caused by a mistake in calculating the amount of any Excess Aggregate
      Contributions by or on behalf of a Highly Compensated Participant and the
      income or loss allocable thereto.


                                       50
<PAGE>

                                  ARTICLE VII
                            VESTING IN PLAN ACCOUNTS

      7.1 No Vested Rights Except as Herein Provided. No Participant shall have
any vested right or interest to, or any right of payment of, any assets of the
Trust Fund, except as expressly provided in the Plan. Neither the making of any
allocations nor the credit to any Account of a Participant shall vest in any
Participant any right, title, or interest in or to any assets of the Trust Fund.

      7.2 Vesting of Participant Deposits. A Participant shall be fully vested
at all times in the amounts allocated to his or her Before Tax Deposits Account,
After Tax Deposits Account, and Rollover Contributions Account.

      7.3  Vesting of Company Contributions.

            (a) A Participant's interest in his or her Matching Contributions
      Account shall vest in accordance with the following schedule:

<TABLE>
<CAPTION>
            Years of Credited Service       Vested Percentage
            -------------------------       -----------------
<S>                                         <C>
            Less than 3                                0%
            3 or more                                100%
</TABLE>

            (b) A Participant's interest in his or her Retirement Contributions
      Account shall vest in accordance with the following schedule:

<TABLE>
<CAPTION>
            Years of Credited Service      Vested Percentage
            -------------------------      -----------------
<S>                                        <C>
            Less than 1                                0%
            1 but less than 2                         20%
            2 but less than 3                         40%
            3 but less than 4                         60%
            4 but less than 5                         80%
            5 or more                                100%
</TABLE>

            (c) A Participant shall at all times be 100% vested in all amounts
      transferred from the SmithKline Beckman Corporation Savings and Investment
      Plan to the Plan.

            (d) Notwithstanding paragraphs (a) and (b) above, a Participant
      shall become fully vested in his or her Matching Contributions Account and
      Retirement Contributions Account upon the occurrence of any of the
      following events, if such Participant is then still an Employee:

                  (i) Attainment of age sixty-two (62);


                                       51
<PAGE>

                  (ii) Death;

                  (iii) Severance due to a Disability; or

                  (iv) Occurrence of a Change in Control pursuant to Section
            12.4.


                                       52
<PAGE>

                                  ARTICLE VIII
                            PAYMENT OF PLAN BENEFITS

      8.1 Withdrawals During Employment. A Participant may withdraw, once in any
calendar quarter, amounts of at least $500 from his or her Accounts while an
Employee in accordance with the following rules:

            (a) A Participant may, for any reason, withdraw any portion of the
      amount allocated to his or her After Tax Deposits Account (excluding any
      After Tax Deposits recharacterized as such under Section 4.5). A
      Participant who makes a withdrawal of After Tax Deposits (whether Matched
      Deposits or non-Matched Deposits) shall not be permitted to make any After
      Tax or and Before Tax Deposits during the six (6) month period beginning
      as soon as administratively feasible following the date of the withdrawal
      unless the After Tax Deposits can also be withdrawn under paragraph (d)
      below or the withdrawal is comprised solely of After Tax Deposits which
      are not Matched Deposits and which were contributed prior to July 1, 2000.

            (b) A Participant may, for any reason, withdraw any portion of the
      amount allocated to his or her Rollover Contributions Account.

            (c) After withdrawing all After Tax Deposits pursuant to paragraph
      (a) and all amounts allocated to his or her Rollover Contributions Account
      under paragraph (b) above, a Participant with 3 or more years of Credited
      Service may, for any reason, withdraw any portion of the amount allocated
      to his or her Matching Contributions Account that was so allocated 2 or
      more years prior to the date of such a withdrawal.

            (d) On or after the attainment of age 59-1/2, a Participant may
      withdraw any vested portion of the amounts allocated to any of his or her
      Accounts except his or her Retirement Contributions Account.

            (e) After withdrawing all amounts permitted pursuant to paragraphs
      (a), (b) (c), and (d) above, a Participant may withdraw amounts from his
      or her Before Tax Deposits Account (excluding any earnings attributable to
      such Account after December 31, 1988), the vested portion of his or her
      Matching Contributions Account, and any remaining amount in his or her
      After Tax Deposits (amounts which were recharacterized as After Tax
      Deposits under Section 4.5 but excluding any earnings attributable to
      recharacterized After Tax Deposits after December 31, 1988) but excluding
      amounts from his or her Retirement Contributions Account upon incurring a
      hardship as defined in Section 8.5.

            (f) Except as provided in paragraphs (a) through (e) above,
      Participants may not receive a distribution of their benefits under the
      Plan prior to termination of employment.


                                       53
<PAGE>

            (g) Except as provided in Section 8.5(c), all withdrawals shall be
      made in cash, except to the extent any of the vested portion of a
      Participant's Account to be withdrawn is invested in the Company Stock
      Fund or in the stock of Advanced Medical Optics, Inc., then such
      withdrawal may be made in Company Stock or in the stock of Advanced
      Medical Optics, Inc. at the election of the Participant to the extent so
      invested.

            (h) Except as provided in Section 8.5(c), all withdrawals shall be
      made to Participants as soon as reasonably practicable following the
      Valuation Date in the month for which a properly completed withdrawal
      request is deemed perfected. All withdrawals shall be based on the Account
      balances of a Participant as of such Valuation Date. If a properly
      completed withdrawal request is received by the Company during any month
      and on or before the fifteenth day of such month, the withdrawal request
      shall be deemed perfected in such month, otherwise such withdrawal request
      shall be deemed perfected in the immediately following month.

            (i) Notwithstanding anything to the contrary in this Section 8.1 or
      Section 4.1, the additional withdrawal restrictions stated in Section
      5.6(h) shall apply to all Participants who are Insiders, as that term is
      defined Section 5.6(h).

      8.2 Distributions Upon Termination of Employment or Disability.

            (a) Subject to the provisions of Section 8.6, if a Participant
      incurs a Severance for any reason (including Disability) other than death,
      all or a portion of such Participant's entire vested portion of his or her
      Accounts under the Plan shall be (i) distributed directly to such
      Participant or (ii) at the election of the Participant, distributed as an
      Eligible Rollover Distribution and paid directly by the Trustee to the
      trustee of an Eligible Retirement Plan.

            (b) Any distribution made pursuant to paragraph (a) shall be paid no
      more than once in any calendar quarter in amounts of at least $500 (or the
      Participant's entire vested portion of his or her Accounts under the Plan
      if lesser) and shall be made in cash except to the extent any of the
      vested portion of such Participant's Accounts is invested in the Company
      Stock Fund or in the stock of Advanced Medical Optics, Inc. then, to the
      extent so invested, such distribution may be made in Company Stock or in
      the stock of Advanced Medical Optics, Inc. at the election of the
      Participant.

            (c) Notwithstanding the provisions contained in the foregoing
      paragraphs of this Section 8.2 or Section 8.1, any provision which
      restricts or would deny a Participant through the withholding of consent
      or the exercise of discretion by some person or persons other than the
      Participant (and where relevant, other than the Participant's spouse) of
      an alternative form of benefit, in violation of Code Section 411(d)(6) and
      the regulation promulgated thereunder, is hereby amended by the deletion
      of the consent and/or discretion requirement.

            (d) Notwithstanding the provisions contained in the foregoing
      paragraphs of this Section 8.2 or Section 8.1, upon receipt of a Qualified
      Domestic Relations Order, the


                                       54
<PAGE>

      amount payable to an Alternate Payee (as such terms are described in
      Section 15.2) may be distributed to the Alternate Payee as soon as
      administratively feasible.

      8.3 Distribution Upon Death of Participant. Subject to the provisions of
Section 8.6, in the event of the death of a Participant, the entire vested
portion of the Participant's Accounts shall be distributed to the surviving
spouse as Beneficiary (if still alive) unless the Participant designated another
Beneficiary pursuant to Section 8.4. If the Beneficiary is the surviving spouse
of the Participant, he or she may elect to have an Eligible Rollover
Distribution paid directly by the Trustee to the trustee of an Eligible
Retirement Plan. Distributions to the Beneficiary pursuant to this Section 8.3
shall be in the same form as specified in Section 8.2(b) above, as elected by
the Beneficiary. All such distributions shall be made as soon as practicable
after the death of the Participant. A Beneficiary may not elect to defer such a
distribution.

      8.4 Designation of Beneficiary. At any time, and from time to time, each
Participant shall have the unrestricted right to designate the Beneficiary or
Beneficiaries to receive the entire vested portion of his or her Accounts upon
his or her death and to revoke any such designation subject to paragraphs (a)
and (b) below. Each such designation shall be evidenced by a written instrument
signed by the Participant and filed with the Committee.

            (a) If the Participant is married and designates a Beneficiary other
      than his or her spouse, said designation shall not be honored by the
      Committee unless accompanied by the written consent of said spouse to said
      designation. Such consent (i) must designate a Beneficiary which may not
      be changed without the consent of the spouse (or the consent of the spouse
      expressly permits designation by the Participant without any further
      consent by the spouse), (ii) must acknowledge the effect of the
      designation, and (iii) must be witnessed by a Plan representative or a
      notary public. No consent of such spouse shall be necessary if it is
      established to the satisfaction of a Plan representative that the consent
      required under this paragraph (b) cannot or need not be obtained because
      (i) there is no spouse, (ii) the spouse cannot be located, or (iii) there
      exist such other circumstances which, pursuant to regulations under Code
      Section 417, permit a distribution to another Beneficiary. Any consent of
      a spouse obtained pursuant to this paragraph (b) or any determination that
      the consent of the spouse cannot (or need not) be obtained, shall be
      effective only with respect to that spouse. If a Participant becomes
      married following his or her designation of a Beneficiary other than his
      or her spouse, such designation shall be ineffective unless the spousal
      consent requirements of this paragraph are satisfied with respect to such
      spouse (subject, however, to the provisions of Article XV regarding
      Qualified Domestic Relations Orders).

            (b) If the Participant is married and does not designate a
      Beneficiary, the Participant's spouse shall be his or her Beneficiary for
      purposes of this Section. If the deceased Participant is not married and
      shall have failed to designate a Beneficiary, or if the Committee shall be
      unable to locate the designated Beneficiary after reasonable efforts have
      been made, or if such Beneficiary shall be deceased, distribution of the
      Participant's death benefit shall be made by payment of the deceased
      Participant's entire interest in the Trust to his or her personal
      representative in a single lump-sum payment. In the event the deceased
      Participant is not a resident of California at the date of his or


                                       55
<PAGE>

      her death, the Committee, in its discretion, may require the establishment
      of ancillary administration in California. If the Committee cannot locate
      a qualified personal representative of the deceased Participant, or if
      administration of the deceased Participant's estate is not otherwise
      required, the Committee, in its discretion, may pay the deceased
      Participant's interest in the Trust to his or her heirs at law (determined
      in accordance with the laws of the State of California as they existed at
      the date of the Participant's death).

      8.5 Hardship Withdrawal Rules. A hardship withdrawal shall be made to a
Participant only if the Committee (or its representative) determines that the
Participant has an immediate and heavy financial need and that a withdrawal from
the Plan is necessary to satisfy such need as set forth in paragraphs (a) and
(b) below.

            (a) A hardship withdrawal shall be authorized by the Committee only
      if the Committee, based upon the Participant's representation and such
      other facts as are known to the Committee, determines that the requested
      withdrawal is on the account of:

                  (i) Medical expenses described in Code Section 213(d) incurred
            by the Participant, the Participant's spouse, or any dependents of
            the Participant (as defined in Code Section 152);

                  (ii) The purchase (excluding mortgage payments) of a principal
            residence for the Participant only;

                  (iii) The payment of tuition and related educational fees for
            the next twelve (12) months of post-secondary education for the
            Participant, his or her spouse, children, or dependents;

                  (iv) The need to prevent the eviction of the Participant from
            his or her principal residence or foreclosure on the mortgage of the
            Participant's principal residence; and

                  (v) Any other situation deemed as immediate and heavy
            financial needs by the Internal Revenue Service through the
            publication of revenue rulings, notices, and other documents of
            general applicability.

            (b) A hardship withdrawal shall be authorized by the Committee only
      if the Committee, based upon the Participant's representation and such
      other facts as are known to the Committee, determines that all of the
      following conditions are or will be satisfied:

                  (i) The amount of the withdrawal is not in excess of the
            amount required to relieve the financial need (including amounts
            necessary to pay any federal, state, or local income taxes or
            penalties reasonably anticipated to result from the withdrawal).


                                       56
<PAGE>

                  (ii) The Participant has obtained all distributions, other
            than hardship withdrawals, and all nontaxable (at the time of the
            loan) loans from the Plan or any other plan maintained by the
            Company.

                  (iii) The Participant shall not be permitted to make Before
            Tax Deposits or After Tax Deposits during the 6-month period
            beginning as soon as administratively feasible following the date of
            the hardship withdrawal from the Plan or any other plan maintained
            by the Company.

                  (iv) The Participant shall not be permitted to make Before Tax
            Deposits during the Participant's taxable year immediately following
            the taxable year of the hardship withdrawal that is in excess of the
            applicable limit under Code Section 402(g) for such immediately
            following taxable year less the amount of such Participant's Before
            Tax Deposits for the taxable year in which such Participant made the
            hardship withdrawal.

            (c) Notwithstanding the provisions of Section 8.1(g), all hardship
      withdrawals shall be made in cash regardless of the fund from which such
      withdrawal is made. The Committee may, at its discretion, establish
      written procedures whereby Participants may receive an estimated
      prepayment of a hardship withdrawal based on the last available valuation
      of such Participant's Accounts with a reconciling adjustment made to such
      Participant's Accounts after current valuation data is available.

      8.6 Distribution Rules. Notwithstanding any other provisions of this
Article VIII of the Plan regarding distributions of Participant's Accounts, the
following additional rules shall apply to all such distributions.

            (a) In no event shall any benefits under the Plan, including
      benefits upon retirement, Severance, or Disability, be paid (or commence
      to be paid) to a Participant prior to the "Consent Date" (as defined
      herein) unless the Participant consents in writing to the payment (or
      commencement of payment) of such benefits prior to said Consent Date. As
      used herein, the term "Consent Date" shall mean the later of (i) the
      Participant's 62nd birthday, or (ii) the Participant's Normal Retirement
      Age. Notwithstanding the foregoing, the provisions of this paragraph shall
      not apply (i) following the Participant's death, or (ii) with respect to a
      lump sum distribution of the vested portion of a Participant's Account if
      the total amount of such vested portion does not exceed $5,000. For
      purposes of clause (ii), Rollover Contributions and the earnings thereon,
      shall be included in determining the value of the vested portion of a
      Participant's Account for distributions made after December 31, 2001 with
      respect to Participants who incur a Severance after December 31, 2001.

            (b) Unless a Participant elects otherwise pursuant to paragraph (a)
      above, distributions of the vested portion of a Participant's Accounts
      shall commence no later than the 60th day after the close of the Plan Year
      in which the latest of the following events occurs: (i) the Participant's
      Normal Retirement Age; (ii) the tenth anniversary of


                                       57
<PAGE>

      the year in which the Participant commenced participation in the Plan; or
      (iii) the termination of the Participant's employment with the Company.

            (c) Notwithstanding paragraphs (a) or (b) above, distributions of
      the entire vested portion of a Participant's Accounts shall be made no
      later than the Participant's Required Beginning Date, or, if such
      distribution is to be made over the life of such Participant or over the
      lives of such Participant and a Beneficiary (or over a period not
      extending beyond the life expectancy of such Participant and Beneficiary)
      then such distribution shall commence no later than the Participant's
      Required Beginning Date. Required Beginning Date shall mean:

                  (i) Participants attaining age 70-1/2 prior to 1999: The
            Required Beginning Date of a Participant who attains age 70-1/2
            prior to 1999 shall be April 1 of the calendar year immediately
            following the year in which the Participant attains age 70-1/2;
            provided, however, that a Participant, other than a Five Percent
            Owner (as defined in Code Section 416(i) and applicable
            regulations), who attains age 70-1/2 in 1996, 1997, or 1998 may
            elect to defer the Required Beginning Date until April 1 of the
            calendar year following the later of the calendar year in which the
            Participant attains age 70-1/2 or retires.

                  (ii) Participants attaining age 70-1/2 after 1998: The
            Required Beginning Date of a Participant who attains age 70-1/2
            after 1998 shall be April 1 of the calendar year immediately
            following the later of the calendar year in which the Participant
            attains age 70-1/2 or retires; provided, however, if such
            Participant is a Five Percent Owner (as defined in Code Section
            416(i) and applicable regulations) with respect to the Plan Year
            ending in the calendar year in which such Participant attains age
            70-1/2, the Required Beginning Date shall be April 1 of the calendar
            year immediately following the year in which such Participant
            attains age 70-1/2.

            (d) Notwithstanding anything to the contrary in the Plan, if a
      Participant dies before distribution of his or her vested benefit has
      begun in accordance with paragraph (c) above, the Participant's vested
      benefit shall be distributed to his or her Beneficiary within five years
      from the date of the Participant's death except that any portion of the
      Account balance meeting the following requirements shall not be subject to
      this rule:

                  (i) A Beneficiary has been designated to receive the
            Participant's Account balance and such designation is effective at
            the Participant's death;

                  (ii) The Account balance is paid to the Beneficiary over the
            Beneficiary's life or over a period not to exceed the Beneficiary's
            life; and

                  (iii) The payments to the Beneficiary commence within one year
            of the Participant's death, or, if the Beneficiary is the spouse,
            before the time the deceased Participant would have attained age
            70-1/2.


                                       58
<PAGE>

            (e) All distributions under the Plan shall be made in accordance
      with the requirements of Code Section 401(a)(9); provided, however, the
      Plan will apply the minimum distribution requirements of Code Section
      401(a)(9) in accordance with the regulations under Code Section 401(a)(9)
      that were proposed on January 17, 2001, notwithstanding any provision of
      the Plan to the contrary. This paragraph (e) shall continue in effect
      until the end of the last calendar year beginning before the effective
      date of final regulations under Code Section 401(a)(9) or such other date
      as may be specified in guidance published by the Internal Revenue Service.

            (f) If it is not administratively practical to calculate and
      commence payments by the latest date specified in the rules of paragraphs
      (b), (c) and (d) above because the amount of the Participant's benefit
      cannot be calculated, or because the Committee is unable to locate the
      Participant (or eligible Beneficiary) after making reasonable efforts to
      do so, the payment shall be made as soon as is administratively possible
      (but not more than 60 days) after the amount of the benefit can be
      ascertained or the Participant (or Beneficiary) can be located.

      8.7 Forfeitures. The non-vested portion of a Participant's Accounts shall
be forfeited in accordance with the following rules:

            (a) In the event a Participant who incurs a Severance receives a
      distribution of the entire vested portion of his or her Accounts when he
      or she is not fully vested in such Accounts, the non-vested portion of the
      Participant's Accounts shall be forfeited as of the Participant's
      distribution date. A Participant who incurs a Severance when no portion of
      his or her Accounts are vested shall be deemed to have received a
      distribution pursuant to this paragraph (a) as of his or her Severance
      Date and his or her Accounts shall be forfeited as of the Participant's
      Severance Date. If the Participant is rehired by the Company prior to the
      date he or she incurs five consecutive Breaks in Service, the amounts
      forfeited shall be reinstated to the Participant's Accounts as of the
      Participant's Reemployment Commencement Date (without regard to any
      interest or investment earnings on such amount).

            (b) In the event a Participant who incurs a Severance does not
      receive a distribution of the entire vested portion of his or her Accounts
      when he or she is not fully vested in such Accounts, the Participant's
      Accounts shall be held by the Trustee as provided in Section 6.8 for 90
      days at which time, the nonvested portion of the Participant's Accounts
      shall be forfeited as of the last day of the month in which the 90-day
      period ends. If the Participant is rehired by the Company prior to the
      date he or she incurs five consecutive Breaks in Service, the amount so
      forfeited plus an amount equal to the rate of return that the amount
      forfeited would have received but for forfeiture pursuant to this
      paragraph (b) shall be reinstated to the Participant's Accounts as of the
      Participant's Reemployment Commencement Date. The Company shall be
      obligated to contribute to the Trust Fund any amounts necessary after
      application of Section 6.3 to reinstate a Participant's Accounts if
      reinstatement is required under the provisions of this paragraph.


                                       59
<PAGE>

            (c) At any relevant time after application of paragraphs (a) and (b)
      above, a Participant's vested portion of his or her Accounts shall be
      equal to an amount ("X") determined by the following formula:

                               X = P*(AB + D) - D

      For the purposes of applying the formula:

            P = the vested percentage at any relevant time determined
                pursuant to Section 7.2

            AB = the Account balance at the relevant time

            D = the total amount of any distributions from the Accounts
                since such Severance

            (d) Forfeitures shall be allocated in the manner provided in Section
      6.3 at such times as determined by the Committee and to the extent
      available shall be used to reduce contributions made by the Company
      pursuant to Sections 5.3 and 5.4.

      8.8 Valuation of Accounts Upon Distribution. For the purpose of any
distribution of Accounts under this Article VIII, the amount of such
distribution shall be based on the value of a Participant's Accounts as of the
Valuation Date in the month in which the application for such distribution is
deemed perfected. If a properly completed distribution application is received
by the Committee during any month and on or before the fifteenth day of such
month, the distribution application shall be deemed perfected in such month,
otherwise such distribution application shall be deemed perfected in the
immediately following month.

      8.9 Lapsed Benefits.

            (a) In the event that a Participant's Accounts is payable under the
      Plan and after reasonable efforts the Participant cannot be located for
      the purpose of paying his or her Accounts during a period of three
      consecutive years, the Participant shall be presumed dead and his or her
      Accounts shall, upon the expiration of that three year period, be paid to
      the Participant's Beneficiary. If the Participant's Beneficiary cannot be
      located for the purpose of paying the Participant's Accounts for the
      following two years, then the Participant's Accounts shall, upon
      expiration of such two-year period, be forfeited and reallocated to the
      Accounts of other Participants in accordance with Section 6.3.

            (b) If a Participant dies prior to receiving a distribution of the
      entire vested portion of his or her Accounts (other than a Participant
      presumed to have died as provided above) and if after reasonable efforts
      the Beneficiary of the Participant cannot be located for the purpose of
      paying the Participant's Accounts during a period of five consecutive
      years, the benefit shall, upon expiration of such five-year period, be
      forfeited and reallocated to the Accounts of the other Participants in
      accordance with Section 6.3.


                                       60
<PAGE>

            (c) For purposes of this Section, the term "Beneficiary" shall
      include any person entitled under Section 8.4 to receive the vested
      interest of a deceased Participant or deceased designated Beneficiary. It
      is the intention of this Section that during the relevant waiting period
      (two years or five years) the vested portion of a Participant's Accounts
      shall be distributed to a Beneficiary in a lower priority category under
      Section 8.4 if no Beneficiary in a higher priority category can be located
      by the Committee after reasonable efforts have been made.

            (d) Notwithstanding the foregoing rules, if after such a forfeiture
      the Participant or a Beneficiary claims the forfeited Accounts, the amount
      forfeited shall be reinstated (without regard to any interest or
      investment earnings on such amount) and paid to the Participant or
      Beneficiary as soon as practical following the production of reasonable
      proof of the identity of the Participant or Beneficiary and his or her
      entitlement to the amounts forfeited (determined pursuant to the Plan's
      normal claim procedures under Section 9.8).

            (e) The Committee shall direct the Trustee with respect to the
      procedures to be followed concerning a missing Participant (or
      Beneficiary), and the Company shall be obligated to contribute to the
      Trust Fund any amounts necessary after the application of Section 6.3 to
      pay any reinstated benefit after it has been forfeited pursuant to the
      provisions of this Section.

      8.10 Persons Under Legal Disability.

            (a) If any payee under the Plan is a minor or if the Committee
      reasonably believes that any payee is legally incapable of giving a valid
      receipt and discharge for any payment due him/her, the Committee may have
      the payment, or any part thereof, made to the person (or persons or
      institution) whom it reasonably believes is caring for or supporting the
      payee, unless it has received due notice of claim therefor from a duly
      appointed guardian or committee of the payee.

            (b) Any such payment shall be a payment from the Accounts of the
      payee and shall, to the extent thereof, be a complete discharge of any
      liability under the Plan to the payee.

      8.11 Additional Documents.

            (a) The Committee or the Company may require satisfactory proof of
      any matter under the Plan from or with respect to any Employee,
      Participant, or Beneficiary, and no person shall be entitled to receive
      any benefits under the Plan until the required proof shall be furnished.

            (b) The Committee or Trustee, or both, may require the execution and
      delivery of such documents, papers and receipts as the Committee or
      Trustee may determine necessary or appropriate in order to establish the
      fact of death of the deceased


                                       61
<PAGE>

      Participant and of the right and identity of any Beneficiary or other
      person or persons claiming any benefits under this Article VIII.

            (c) The Committee or the Trustee, or both, may, as a condition
      precedent to the payment of death benefits hereunder, require an
      inheritance tax release and/or such security as the Committee or Trustee,
      or both, may deem appropriate as protection against possible liability for
      State or Federal death taxes attributable to any death benefits.

      8.12 Trustee-to-Trustee Transfers. In the case of any Participant or
Participants who have terminated employment with the Company and all Affiliated
Companies and subsequently become employed by an unrelated successor employer,
the Committee, shall at the request of such Participant or Participants, direct
the Trustee to transfer the assets in the Accounts of such Participant or
Participants directly to the trustee of any retirement plan maintained by such
successor employer or employers in lieu of any distribution described in the
preceding provisions of this Article VIII but only if (i) the retirement plan
maintained by such successor employer is determined to the satisfaction of the
Committee to be qualified under Code Section 401, (ii) the sponsor and trustee
of such plan consent to the transfer, and (iii) such transfer satisfies the
conditions of Section 12.3 hereof.

      8.13 Loans to Participants. A Participant may borrow from his or her
Accounts except from his or her Retirement Contributions Account while an
Employee in accordance with the following rules:

            (a) Subject to minimum and maximum loan requirements, a Participant
      may borrow up to 50% of his or her After Tax Deposits Account, Before Tax
      Deposits Account, Rollover Contributions Account, and the vested portion
      of his or her Matching Contributions Account. Only one loan may be
      outstanding to a Participant any time. The minimum loan amount shall be
      $1,000 and the maximum loan amount shall be $50,000. The $50,000 maximum
      loan amount shall be reduced by the excess, if any, of the highest
      outstanding balance of loans from the Plan to the Participant during the
      one-year period ending on the day before the loan is made over the
      outstanding balance of loans on the date the loan is made.

            (b) A loan to a Participant shall be made solely from his or her
      Account(s) and shall be considered an investment directed by the
      Participant. Loan amounts shall be funded from the Participant's Accounts
      as determined under procedures established by the Committee; provided,
      however, that principal repayments shall be credited to the Participant's
      Accounts in the inverse of the order used to fund the loan and interest
      payments shall be credited to the Participant's Accounts in direct
      proportion to the principal repayments.

            (c) A loan to a Participant shall bear an interest rate equal to the
      prime rate reported in the Wall Street Journal on first business day of
      the month in which the loan is granted (the last business day of the
      previous month for loans made prior to July 1, 2000) plus one percent (1%)
      and shall remain fixed throughout the term of the loan.


                                       62
<PAGE>

      Notwithstanding the preceding sentence, if the Committee determines that
      such rate is not reasonable or otherwise not in accordance with applicable
      requirements under the Code or ERISA, the Committee shall set an alternate
      interest rate at the time that the loan is taken.

            (d) A loan to a Participant shall have a definite maturity date.
      Loans, other than loans made for the purpose of acquiring the principal
      residence of the Participant, shall be made for a period not to exceed
      five (5) years. Loans made for the purpose of acquiring the principal
      residence of the Participant shall be made for a period not to exceed
      fifteen (15) years.

            (e) A loan to a Participant shall have a definite repayment schedule
      and shall be amortized on a substantially level basis with repayments
      occurring not less frequently than quarterly. Notwithstanding the
      foregoing, the loan repayments shall be suspended during an unpaid Leave
      of Absence not to exceed one year at which time loan repayments shall
      resume. In the case of a Leave of Absence due to qualified military
      service, loan repayments shall be suspended as permitted under Code
      Section 414(u)(4).

            (f) A loan to a Participant shall be secured by the vested portion
      of the Participant's Account(s). No more than 50% of the Participant's
      vested Account(s) as determined on the date the loan is issued shall be
      considered by the Plan as security for a loan. A Participant who borrows
      from the Plan hereby agrees that, unless expressly provided otherwise in
      loan documents, any such loan is automatically secured by 50% of his or
      her vested Account(s).

            (g) A loan to a Participant shall be evidenced by a promissory note
      and/or such other documentation as required by the Committee.

            (h) A loan to a Participant shall be treated as a distribution
      unless the entire principal amount and any interest accrued thereon is
      repaid within ninety (90) days after the occurrence of a Participant's
      Severance. Absent repayment by the Participant, the Committee shall
      instruct the Trustee to distribute the note to the Participant as part of
      his or her distribution and the Participant's vested Account(s) shall be
      reduced to the extent of such distribution.

            (i) The Committee shall establish the participant loan program and
      have the duty to manage and administer the participant loan program in
      accordance with the terms and provisions of this Section. The Committee
      shall have, but not by way of limitation, the following discretionary
      powers and authority:

                  (i) To determine the manner in which loan repayments shall
            occur whether it be through automatic payroll deductions or
            otherwise.

                  (ii) To determine the amount of loan repayments following
            suspension due to an unpaid Leave of Absence subject to the
            requirement that the loan must be repaid by the latest date
            permitted under paragraph (d).


                                       63
<PAGE>

                  (iii) To establish any fees, including but not limited to
            application fees and maintenance fees, and the manner in which such
            fees are collected from the Participant.

                  (iv) To consider only those factors which would be considered
            in a normal commercial setting by persons in the business of making
            similar types of loans in establishing the participant loan program.
            Such factors may include the applicant's credit worthiness and
            financial need, but may not include any factor which would
            discriminate against Participants who are not Highly Compensated
            Employees. Loans shall be made available to all Participants without
            regard to a Participant's race, color, religion, sex, age or
            national origin and shall not be made available to Participants who
            are Highly Compensated Employees in an amount greater than the
            amount made available to Participants who are not Highly Compensated
            Employees.


                                       64
<PAGE>

                                   ARTICLE IX
                          OPERATION AND ADMINISTRATION

      9.1 Appointment of Committee. There is hereby created a committee (the
"Committee") which shall exercise such powers and have such duties in
administering the Plan as are hereinafter set forth. The Board of Directors
shall determine the number of members of such Committee. The members of the
Committee shall be appointed by the Board of Directors and such Board shall from
time to time fill all vacancies occurring in said Committee. The members of the
Committee shall constitute the Named Fiduciaries of the Plan within the meaning
of Section 402(a)(2) of ERISA; provided that solely for purposes of Section 5.9
hereof, Participants shall be Named Fiduciaries with respect to shares of
Company Stock allocated to their respective Accounts and solely for purposes of
Section 5.10, Participants shall be Named Fiduciaries with respect to shares of
Company Stock allocated to their respective Accounts on matters as to which they
are entitled to provide voting directions.

      9.2 Transaction of Business. A majority of the Committee shall constitute
a quorum for the transaction of business. Actions of the Committee may be taken
either by vote at a meeting or in writing without a meeting. All action taken by
the Committee at any meeting shall be by a vote of the majority of those present
at such meeting. All action taken in writing without a meeting shall be by a
vote of the majority of those responding in writing. All notices, advices,
directions and instructions to be transmitted by the Committee shall be in
writing and signed by or in the name of the Committee. In all its communications
with the Trustee, the Committee may, by either of the majority actions specified
above, authorize any one or more of its members to execute any document or
documents on behalf of the Committee, in which event it shall notify the Trustee
in writing of such action and the name or names of its members so designated and
the Trustee shall thereafter accept and rely upon any documents executed by such
member or members as representing action by the Committee until the Committee
shall file with the Trustee a written revocation of such designation.

      9.3 Voting. Any member of the Committee who is also a Participant
hereunder shall not be qualified to act or vote on any matter relating solely to
himself or herself, and upon such matter his or her presence at a meeting shall
not be counted for the purpose of determining a quorum. If, at any time a member
of the Committee is not so qualified to act or vote, the qualified members of
the Committee shall be reduced below two (2), the Board of Directors shall
promptly appoint one or more special members to the Committee so that there
shall be at least one qualified member to act upon the matter in question. Such
special Committee members shall have power to act only upon the matter for which
they were especially appointed and their tenure shall cease as soon as they have
acted upon the matter for which they were especially appointed.

      9.4 Responsibility of Committee. The authority to control and manage the
operation and administration of the Plan, the general administration of the
Plan, the responsibility for carrying out the Plan and the authority and
responsibility to control and manage the assets of the Trust are hereby
delegated by the Board of Directors to and vested in the Committee, except to
the extent reserved to the Board of Directors, the Sponsor, or the Company.
Subject to the limitations of the Plan, the Committee shall, from time to time,
establish rules for the


                                       65
<PAGE>

performance of its functions and the administration of the Plan. In the
performance of its functions, the Committee shall not discriminate in favor of
Highly Compensated Employees.

      9.5 Committee Powers. The Committee shall have all discretionary powers
necessary to supervise the administration of the Plan and control its
operations. In addition to any discretionary powers and authority conferred on
the Committee elsewhere in the Plan or by law, the Committee shall have, but not
by way of limitation, the following discretionary powers and authority:

            (a) To designate agents to carry out responsibilities relating to
      the Plan, other than fiduciary responsibilities as provided in Section
      9.6.

            (b) To employ such legal, actuarial, medical, accounting, clerical,
      and other assistance as it may deem appropriate in carrying out the
      provisions of the Plan, including one or more persons to render advice
      with regard to any responsibility any Named Fiduciary or any other
      fiduciary may have under the Plan.

            (c) To establish rules and regulations from time to time for the
      conduct of the Committee's business and the administration and
      effectuation of the Plan.

            (d) To administer, interpret, construe, and apply the Plan and to
      decide all questions which may arise or which may be raised under the Plan
      by any Employee, Participant, former Participant, Beneficiary or other
      person whatsoever, including but not limited to all questions relating to
      eligibility to participate in the Plan, the amount of Credited Service of
      any Participant, and the amount of benefits to which any Participant or
      his or her Beneficiary may be entitled.

            (e) To determine the manner in which the assets of the Plan, or any
      part thereof, shall be disbursed.

            (f) To direct the Trustee, in writing, from time to time, to invest
      and reinvest the Trust Fund, or any part thereof, or to purchase,
      exchange, or lease any property, real or personal, which the Committee may
      designate. This shall include the right to direct the investment of all or
      any part of the Trust in any one security or any one type of securities
      permitted hereunder. Among the securities which the Committee may direct
      the Trustee to purchase are "qualifying employer securities" as defined in
      Code Section 4975(e).

            (g) Subject to provisions (a) through (d) of Section 10.1, to make
      administrative amendments to the Plan that do not cause a substantial
      increase or decrease in benefit accruals to Participants and that do not
      cause a substantial increase in the cost of administering the Plan.

            (h) To perform or cause to be performed such further acts as it may
      deem to be necessary, appropriate or convenient in the efficient
      administration of the Plan.


                                       66
<PAGE>

      Any action taken in good faith by the Committee in the exercise of
discretionary powers conferred upon it by the Plan shall be conclusive and
binding upon the Participants and their Beneficiaries. All discretionary powers
conferred upon the Committee shall be absolute; provided, however, that all such
discretionary power shall be exercised in a uniform and nondiscriminatory
manner.

      9.6 Additional Powers of Committee. In addition to any discretionary
powers or authority conferred on the Committee elsewhere in the Plan or by law,
such Committee shall have the following discretionary powers and authority:

            (a) To appoint one or more Investment Managers pursuant to Section
      5.16 to manage and control any or all of the assets of the Trust not
      invested or to be invested in Company Stock.

            (b) To designate persons (other than the members of the Committee)
      to carry out fiduciary responsibilities, other than any responsibility to
      manage or control the assets of the Trust;

            (c) To allocate fiduciary responsibilities among the members of the
      Committee, other than any responsibility to manage or control the assets
      of the Trust;

            (d) To cancel any such designation or allocation at any time for any
      reason;

            (e) To direct the voting of any Company Stock or any other security
      held by the Trust subject to Section 9.13 hereof; and

            (f) To exercise management and control over Plan assets and to
      direct the purchase and sale of Company Stock for the Trust.

      Any action under this Section 9.6 shall be taken in writing, and no
designation or allocation under paragraphs (a), (b) or (c) shall be effective
until accepted in writing by the indicated responsible person.

      9.7 Periodic Review of Funding Policy. At periodic intervals the Committee
shall review the long-run and short-run financial needs of the Plan and shall
determine a funding policy for the Plan consistent with the objectives of the
Plan and the minimum funding standards of ERISA, if applicable. In determining
such funding policy the Committee shall take into account, at a minimum, not
only the long-term investment objectives of the Trust Fund consistent with the
prudent management of the assets thereof, but also the short-run needs of the
Plan to pay benefits. All actions taken by the Committee with respect to the
funding policy of the Plan, including the reasons therefor, shall be fully
reflected in the minutes of the Committee.

      9.8 Claims Procedures. If a Participant or his or her Beneficiary believes
that he or she is being denied any rights or benefits under the Plan, the
Participant, Beneficiary, or in either case, his or her authorized
representative (the "Claimant") shall follow the administrative procedures for
filing a claim for benefits as set forth in this Section. A claim for benefits
shall be


                                       67
<PAGE>

in writing and shall be reviewed by the Committee or a claims official
designated by the Committee. The Committee or claims official shall review a
claim for benefits in accordance with the procedures established by the
Committee subject to the following administrative procedures set forth in this
Section.

            (a) The Committee shall furnish the Claimant with written or
      electronic notice of the decision rendered with respect to a claim for
      benefits within 90 days following receipt by the Committee (or its
      delegate) of the claim unless the Committee determines that special
      circumstances require an extension of time for processing the claim. In
      the event an extension is necessary, written or electronic notice of the
      extension shall be furnished to the Claimant prior to the expiration of
      the initial 90 day period. The notice shall indicate the special
      circumstances requiring an extension of time and the date by which a final
      decision is expected to be rendered. In no event shall the period of the
      extension exceed 90 days from the end of the initial 90 day period.

            (b) In the case of a denial of the Claimant's claim, the written or
      electronic notice of such denial shall set forth (i) the specific reasons
      for the denial, (ii) references to the Plan provisions upon which the
      denial is based, (iii) a description of any additional information or
      material necessary for perfection of the claim (together with an
      explanation why such material or information is necessary), (iv) an
      explanation of the Plan's appeals procedures, and (v) a statement of the
      Claimant's right to bring a civil action under Section 502(a) of ERISA if
      his or her claim is denied upon appeal.

            (c) In the case of a denial of a claim, a Claimant who wishes to
      appeal the decision shall follow the administrative procedures for an
      appeal as set forth in Section 9.9 below.

      9.9 Appeals Procedures. A Claimant who wishes to appeal the denial of his
or her claim for benefits shall follow the administrative procedures for an
appeal as set forth in this Section and shall exhaust such administrative
procedures prior to seeking any other form of relief. Appeals shall be reviewed
in accordance with the procedures established by the Committee subject to the
following administrative procedures set forth in this Section.

            (a) In order to appeal a decision rendered with respect to his or
      her claim for benefits, a Claimant must file an appeal with the Committee
      in writing within 60 days following his or her receipt of the notice of
      denial with respect to the claim.

            (b) The Claimant's appeal may include written comments, documents,
      records and other information relating to his or her claim. The Claimant
      may review all pertinent documents and, upon request, shall have
      reasonable access to or be provided free of charge, copies of all
      documents, records, and other information relevant to his or her claim.

            (c) The Committee shall provide a full and fair review of the appeal
      and shall take into account all claim related comments, documents,
      records, and other information submitted by the Claimant without regard to
      whether such information was submitted or considered under the initial
      determination or review of the initial determination. Where


                                       68
<PAGE>

      appropriate, the Committee will overturn a notice of denial if it
      determines that an error was made in the interpretation of the controlling
      plan documents or if the Committee determines that an existing
      interpretation of the controlling plan documents should be changed on a
      prospective basis. In the event the Claimant is a subordinate, as
      determined by the Committee, to an individual conducting the review, such
      individual shall recuse himself or herself from the review of the appeal.

            (d) The Committee shall furnish the Claimant with written or
      electronic notice of the decision rendered with respect to an appeal
      within 60 days following receipt by the Committee of the appeal unless the
      Committee determines that special circumstances require an extension of
      time for processing the appeal. In the event an extension is necessary,
      written or electronic notice of the extension shall be furnished to the
      Claimant prior to the expiration of the initial 60 day period. The notice
      shall indicate the special circumstances requiring an extension of time
      and the date by which a final decision is expected to be rendered. In no
      event shall the period of the extension exceed 60 days from the end of the
      initial 60 day period.

            (e) In the case of a denial of an appeal, the written or electronic
      notice of such denial shall set forth (i) the specific reasons for the
      denial, (ii) references to the Plan provisions upon which the denial is
      based, (iii) a statement that the Claimant is entitled to receive, upon
      request and free of charge, reasonable access to, and copies of, all
      documents, records, and other information relating to his or her claim for
      benefits, and (iv) a statement of the Claimant's right to bring a civil
      action under Section 502(a) of ERISA.

      9.10 Limitation on Liability. Each of the fiduciaries under the Plan shall
be solely responsible for its own acts and omissions and no fiduciary shall be
liable for any breach of fiduciary responsibility resulting from the act or
omission of any other fiduciary or person to whom fiduciary responsibilities
have been allocated or delegated pursuant to Section 9.6, except as provided in
Sections 405(a) and 405(c)(2)(A) or (B) of ERISA. The Committee shall have no
responsibility over assets as to which management and control has been delegated
to an Investment Manager appointed pursuant to Section 5.16 hereof or as to
which management and control has been retained by the Trustee.

      9.11 Indemnification and Insurance. To the extent permitted by law, the
Company shall indemnify and hold harmless the Committee and each member thereof,
each Trustee, the Board of Directors and each member thereof, and such other
persons as the Board of Directors may specify, from the effects and consequences
of his or her acts, omissions, and conduct in his or her official capacity in
connection with the Plan and Trust. To the extent permitted by law, the Company
may also purchase liability insurance for such persons.

      9.12 Compensation of Committee and Plan Expenses. Members of the Committee
shall serve as such without compensation unless the Board of Directors shall
otherwise determine, but in no event shall any member of the Committee who is an
Employee receive compensation from the Plan for his or her services as a member
of the Committee. All members shall be reimbursed for any necessary expenditures
incurred in the discharge of duties as


                                       69
<PAGE>

members of the Committee. The compensation or fees, as the case may be, of all
officers, agents, counsel, the Trustee or other persons retained or employed by
the Committee shall be fixed by the Committee, subject to approval by the Board
of Directors. The expenses incurred in the administration and operation of the
Plan, including but not limited to the expenses incurred by the members of the
Committee in exercising their duties, shall be paid by the Plan from the Trust
Fund, unless paid by the Company, provided, however, that the Plan and not the
Company shall bear the cost of interest and normal brokerage charges which are
included in the cost of securities purchased by the Trust Fund (or charged to
proceeds in the case of sales). If such expenses are to be paid by the Plan from
the Trust Fund, the Committee may direct the Trustee to use forfeitures and
dividends (and to sell the shares of Company Stock that represent such
forfeitures or dividends) to pay such expenses.

      9.13 Resignation. Any member of the Committee may resign by giving fifteen
(15) days notice to the Board of Directors, and any member shall resign
forthwith upon receipt of the written request of the Board of Directors, whether
or not said member is at that time the only member of the Committee.

      9.14 Reliance Upon Documents and Opinions. The members of the Committee,
the Board of Directors, the Company and any person delegated to carry out any
fiduciary responsibilities under the Plan (hereinafter a "delegated fiduciary"),
shall be entitled to rely upon any tables, valuations, computations, estimates,
certificates and reports furnished by any consultant, or firm or corporation
which employs one or more consultants, upon any opinions furnished by legal
counsel, and upon any reports furnished by the Trustee or any Investment
Manager. The members of the Committee, the Board of Directors, the Company and
any delegated fiduciary shall be fully protected and shall not be liable in any
manner whatsoever for anything done or action taken or suffered in reliance upon
any such consultant, or firm or corporation which employs one or more
consultants, Trustee, Investment Manager, or counsel. Any and all such things
done or such action taken or suffered by the Committee, the Board of Directors,
the Company and any delegated fiduciary shall be conclusive and binding on all
Employees, Participants, Beneficiaries, and any other persons whomsoever, except
as otherwise provided by law. The Committee and any delegated fiduciary may, but
are not required to, rely upon all records of the Company with respect to any
matter or thing whatsoever, and may likewise treat such records as conclusive
with respect to all Employees, Participants, Beneficiaries, and any other
persons whomsoever, except as otherwise provided by law.


                                       70
<PAGE>

                                   ARTICLE X
                         AMENDMENT AND ADOPTION OF PLAN

      10.1 Right to Amend Plan. The Sponsor, by resolution of the Board of
Directors, shall have the right to amend the Plan and Trust Agreement at any
time and from time to time and in such manner and to such extent as it may deem
advisable, including retroactively, subject to the following provisions:

            (a) No amendment shall have the effect of reducing any Participant's
      vested interest in the Plan or eliminating an optional form of
      distribution.

            (b) No amendment shall have the effect of diverting any part of the
      assets of the Plan to persons or purposes other than the exclusive benefit
      of the Participants or their Beneficiaries.

            (c) No amendment shall have the effect of increasing the duties or
      responsibilities of a Trustee without its written consent.

            (d) No amendment shall result in discrimination in favor of
      officers, shareholders, or other highly compensated or key employees.

      The Committee shall have the right to amend the Plan, subject to
paragraphs (a) through (d), in accordance with the provisions of Section 9.5(g).

      10.2 Adoption of Plan by Affiliated Companies. Subject to approval by the
Board of Directors and consistent with the provisions of ERISA, an Affiliated
Company may adopt the Plan for all or any specified group of its Eligible
Employees by entering into an adoption agreement in the form and substance
prescribed by the Committee. The adoption agreement may include such
modification of the Plan provisions with respect to such Eligible Employees as
the Committee approves after having determined that no prohibited discrimination
or other threat to the qualification of the Plan is likely to result. The Board
of Directors may prospectively revoke or modify an Affiliated Company's
participation in the Plan at any time and for any or no reason, without regard
to the terms of the adoption agreement, or terminate the Plan with respect to
such Affiliated Company's Eligible Employees and Participants. By execution of
an adoption agreement (each of which by this reference shall become part of the
Plan), the Affiliated Company agrees to be bound by all the terms and conditions
of the Plan.


                                       71
<PAGE>

                                   ARTICLE XI
                         DISCONTINUANCE OF CONTRIBUTIONS

      In the event the Company decides it is impossible or inadvisable for
business reasons to continue to make contributions under the Plan, it may, by
resolution of the Board of Directors, discontinue contributions to the Plan.
Upon the permanent discontinuance of contributions to the Plan and
notwithstanding any other provisions of the Plan, the rights of Participants
shall become fully vested and nonforfeitable unless replaced by a comparable
plan. The permanent discontinuance of contributions on the part of the Company
shall not terminate the Plan as to the funds and assets then held in the Trust,
or operate to accelerate any payments of distributions to or for the benefit of
Participants or Beneficiaries, and the Trust shall continue to be administered
in accordance with the provisions hereof until the obligations hereunder shall
have been discharged and satisfied.


                                       72
<PAGE>

                                  ARTICLE XII
                             TERMINATION AND MERGER

      12.1 Right to Terminate Plan. In the event the Board of Directors decides
it is impossible or inadvisable for business reasons to continue the Plan, then
it may, by resolution, terminate the Plan. Upon and after the effective date of
such termination, the Company shall not make any further contributions under the
Plan. Upon the termination or partial termination of the Plan for any reason,
the interest in the Trust of each affected Participant shall automatically
become fully vested unless the Plan is continued after its termination by
conversion of the Plan into a comparable Plan through Plan amendment or through
merger. After the satisfaction of all outstanding liabilities of the Plan to
persons other than Participants and Beneficiaries, all unallocated assets shall
be allocated to the Accounts of Participants to the maximum extent permitted by
law. The Trust Fund may not be fully or finally liquidated until all assets are
allocated to Accounts; alternatively any unallocated assets may be transferred
to another defined contribution plan maintained by the Sponsor or an Affiliated
Company qualified under Code Section 401 where such assets shall be allocated
among the accounts of Participants herein who are participants in such
transferee plan. In no event, however, shall any part of the Plan revert to or
be recoverable by the Company, or be used for or diverted to purposes other than
for the exclusive benefit of the Participants or their Beneficiaries.
Notwithstanding the foregoing, amounts held in the 415 Suspense Account may
revert to the Company in accordance with Section 13.6.

      12.2 Merger Restriction. Notwithstanding any other provision in the Plan,
the Plan shall not in whole or in part merge or consolidate with, or transfer
its assets or liabilities to, any other plan unless each affected Participant in
the Plan would (if such other plan then terminated) receive a benefit
immediately after the merger, consolidation, or transfer which is equal to or
greater than the benefit he or she would have been entitled to receive
immediately before the merger, consolidation, or transfer (if the Plan had then
terminated).

      12.3 Effect on Trustee and Committee. The Trustee and the Committee shall
continue to function as such for such period of time as may be necessary for the
winding up of the Plan and for the making of distributions in the manner
prescribed by the Board of Directors at the time of termination of the Plan.

      12.4  Effect of Reorganization, Transfer of Assets or Change in Control.

            (a) In the event of a consolidation or merger of the Company, or in
      the event of a sale and/or any other transfer of the operating assets of
      the Company, any ultimate successor or successors to the business of the
      Company may continue the Plan in full force and effect by adopting the
      same by resolution of its board of directors and by executing a proper
      supplemental or transfer agreement with the Trustee.

            (b) In the event of a Change in Control (as herein defined), all
      Participants who were Participants on the date of such Change in Control
      shall become 100% vested in any amounts allocated to their Company
      Contributions


                                       73
<PAGE>

      Accounts on the date of such Change in Control and in any amounts
      allocated to their Company Contributions Accounts subsequent to the date
      of the Change in Control. Notwithstanding the foregoing, the Board of
      Directors may, at its discretion, amend or delete this paragraph (b) in
      its entirety prior to the occurrence of any such Change in Control. For
      the purpose of this paragraph (b), "Change in Control" shall mean the
      following and shall be deemed to occur if any of the following events
      occur:

                  (i) Any "person," as such term is used in Sections 13(d) and
            14(d) of the Securities Exchange Act of 1934, as amended (the
            "Exchange Act") (a "Person"), is or becomes the "beneficial owner,"
            as defined in Rule 13d-3 under the Exchange Act (a "Beneficial
            Owner"), directly or indirectly, of securities of the Sponsor
            representing (1) 20% or more of the combined voting power of the
            Sponsor's then outstanding voting securities, which acquisition is
            not approved in advance of the acquisition or within 30 days after
            the acquisition by a majority of the Incumbent Board (as hereinafter
            defined) or (2) 33% or more of the combined voting power of the
            Sponsor's then outstanding voting securities, without regard to
            whether such acquisition is approved by the Incumbent Board;

                  (ii) Individuals who, as of the date hereof, constitute the
            Board of Directors (the "Incumbent Board"), cease for any reason to
            constitute at least a majority of the Board of Directors, provided
            that any person becoming a director subsequent to the date hereof
            whose election, or nomination for election by the Sponsor's
            stockholders, is approved by a vote of at least a majority of the
            directors then comprising the Incumbent Board (other than an
            election or nomination of an individual whose initial assumption of
            office is in connection with an actual or threatened election
            contest relating to the election of the directors of the Sponsor, as
            such terms are used in Rule 14a-11 of Regulation 14A promulgated
            under the Exchange Act) shall, for the purposes of the Plan, be
            considered as though such person were a member of the Incumbent
            Board of the Sponsor;

                  (iii) The consummation of a merger, consolidation or
            reorganization involving the Sponsor, other than one which satisfies
            both of the following conditions:

                        (1) a merger, consolidation or reorganization which
                  would result in the voting securities of the Sponsor
                  outstanding immediately prior thereto continuing to represent
                  (either by remaining outstanding or by being converted into
                  voting securities of another entity) at least 55% of the
                  combined voting power of the voting securities of the Sponsor
                  or such other entity resulting from the merger, consolidation
                  or reorganization (the "Surviving Corporation") outstanding
                  immediately after such merger, consolidation or reorganization
                  and being held in substantially the same proportion as the
                  ownership in the Sponsor's voting


                                       74
<PAGE>

                  securities immediately before such merger, consolidation or
                  reorganization, and

                        (2) a merger, consolidation or reorganization in which
                  no Person is or becomes the Beneficial Owner, directly or
                  indirectly, of securities of the Sponsor representing 20% or
                  more of the combined voting power of the Sponsor's then
                  outstanding voting securities; or

                  (iv) The stockholders of the Sponsor approve a plan of
            complete liquidation of the Sponsor or an agreement for the sale or
            other disposition by the Sponsor of all or substantially all of the
            Sponsor's assets.

            Notwithstanding the preceding provisions of this paragraph (b), a
      Change in Control shall not be deemed to have occurred if the Person
      described in the preceding provisions of this paragraph (b) is (i) an
      underwriter or underwriting syndicate that has acquired any of the
      Sponsor's then outstanding voting securities solely in connection with a
      public offering of the Sponsor's securities, (ii) the Sponsor or any
      subsidiary of the Sponsor or (iii) an employee stock ownership plan or
      other employee benefit plan maintained by the Sponsor or an Affiliated
      Company that is qualified under the provisions of the Code. In addition,
      notwithstanding the preceding provisions of this paragraph (b), a Change
      in Control shall not be deemed to have occurred if the Person described in
      the preceding provisions of this paragraph (b) becomes a Beneficial Owner
      of more than the permitted amount of outstanding securities as a result of
      the acquisition of voting securities by the Sponsor or an Affiliated
      Company which, by reducing the number of voting securities outstanding,
      increases the proportional number of shares beneficially owned by such
      Person, provided, that if a Change in Control would occur but for the
      operation of this sentence and such Person becomes the Beneficial Owner of
      any additional voting securities (other than through the exercise of
      options granted under any stock option plan of the Sponsor or through a
      stock dividend or stock split), then a Change in Control shall occur.

            (c) For purposes of this Section 12.4, a Change of Control shall not
      be deemed to have occurred upon the distribution of the stock of Advanced
      Medical Optics, Inc. on June 29, 2002 by the Sponsor to its stockholders.


                                       75
<PAGE>

                                  ARTICLE XIII
                            LIMITATION ON ALLOCATIONS

      13.1  General Rule.

            (a) The total Annual Additions under the Plan to a Participant's
      Accounts shall not exceed the lesser of:

                  (i) Forty Thousand Dollars ($40,000) as adjusted for increases
            in the cost-of-living under Code Section 415(d); or

                  (ii) One Hundred Percent (100%) of the Participant's
            Compensation (as defined in Section 13.5), from the Company for the
            Limitation Year,

      except to the extent "catch-up" contributions are permitted under Section
      4.2(e) and Code Section 414(v). Notwithstanding the foregoing sentence,
      the compensation limit set forth in subparagraph (ii) shall not apply to
      any contribution for medical benefits after separation from service
      (within the meaning of Code Section 401(h) or Code Section 419A(f)(2))
      which is otherwise treated as an Annual Addition.

            (b) For the purpose of this Article XIII, the term "Company" shall
      mean the Sponsor and any Affiliated Company (determined by reference to
      Code Section 415(h)) whether or not such Affiliated Company has adopted
      the Plan pursuant to Section 10.2 and the term "Limitation Year" shall
      mean the Plan Year.

      13.2 Annual Additions. For purposes of Section 13.1, the term "Annual
Additions" shall mean with respect to a Participant, for any Limitation Year
with respect to the Plan, the sum of the amounts described below:

            (a) All amounts contributed or deemed contributed by the Company.

            (b) All amounts contributed by the Participant.

            (c) Forfeitures allocated to such Participant.

            (d) Any amounts allocated, after March 31, 1984, to an individual
      medical account as defined in Code Section 415(l)(2) established under a
      pension or annuity plan maintained by the Company.

            (e) Any amounts allocated for such Plan Year which amounts are
      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 Code Section 419A(d)(3)) under a welfare benefit
      fund (as defined in Code Section 419(e)) maintained by the Company.


                                       76
<PAGE>

            (f) Excess deferral amounts determined pursuant to Sections 4.5 and
      6.12.

            (g) Excess deferral amounts determined pursuant to Section 4.4 to
      the extent such amounts are distributed after the first April 15th
      following the close of the Participant's taxable year.

      Notwithstanding the foregoing, a Participant's Rollover Contributions
shall not be considered an Annual Addition.

      13.3 Other Defined Contribution Plans. If the Company maintains any other
defined contribution plan, then each Participant's Annual Additions under such
defined contribution plan shall be aggregated with the Participant's Annual
Additions under the Plan for the purposes of applying the limitations of Section
13.1.

      13.4 Adjustments for Excess Annual Additions. If as a result of the
allocation of forfeitures, a reasonable error in estimating a Participant's
Compensation, or under other limited facts and circumstances that the
Commissioner of Internal Revenue finds justify the availability of the rules set
forth in Regulation Section 1.415-6(b)(6), the Annual Additions on behalf of any
Participant in a Limitation Year to the Plan and all other defined contribution
plans maintained by the Company exceed the limitation set forth in Section 13.1,
such Participant's Annual Additions for the Plan shall be reduced in the
following order: (i) After Tax Deposits that are not Matched Deposits, (ii)
After Tax Deposits that are Matched Deposits, (iii) Before Tax Deposits that are
not Matched Deposits, (iv) Before Tax Deposits that are Matched Deposits, (v)
Matching Contributions, and (vi) Retirement Contributions. The portion of the
reduction attributable to After Tax Deposits and Before Tax Deposits shall be
refunded to the Participants and the balance attributable to Matching
Contributions, if any, shall be held unallocated in a 415 Suspense Account
established for the purpose of this Section 13.4 and shall be used to reduce
Company Contributions for the next limitation year (and succeeding limitation
year, as necessary) for all Participants in the Plan. The 415 Suspense Account
shall be exhausted before any Company contributions shall be allocated to the
Accounts of Participants.

      13.5 Compensation. For the purpose of this Article XIII, Compensation
shall mean a Participant's earned income, wages, salaries, fees for professional
services, and other amounts received (without regard to whether or not an amount
is paid in cash) for personal services actually rendered in the course of
employment with the Company maintaining the Plan and shall be determined as
described below:

            (a) Compensation shall include to the extent that the amounts are
      includible in gross income (including, but not limited to, commissions
      paid salespeople, compensation for services on the basis of a percentage
      of profits, commissions on insurance premiums, tips, bonuses, fringe
      benefits, and reimbursements or other expense allowances under a
      nonaccountable plan as described in Regulation 1.62-2(c)).

            (b) Compensation shall include any elective deferral as defined in
      Code Section 402(g)(3), any amount which is contributed or deferred by the
      Company at the election of the Employee that is excludable from an
      Employee's gross income under


                                       77
<PAGE>

      Code Sections 125 or 457 and, for Plan Years beginning on or after January
      1, 1998, any elective amount that is excludable from an Employee's gross
      income under Code Section 132(f)(4).

            (c) Compensation shall not include (i) any employer contributions to
      a plan of deferred compensation which are not included in the Employee's
      gross income for the taxable year in which contributed, (ii) any
      distributions from a plan of deferred compensation, (iii) any amounts
      realized from the exercise of a non-qualified stock option or when
      restricted stock or property held by the Employee becomes either freely
      transferable or is no longer subject to a substantial risk of forfeiture
      under Code Section 83 if such option, stock, or property was granted to
      the Employee by the Company, (iv) any amounts realized from the sale,
      exchange, or other disposition of stock acquired under a qualified stock
      option, (v) any contribution for medical benefits (within the meaning of
      Code Section 419(f)(2) after termination of employment which is otherwise
      treated as an Annual Addition, and (vi) any amount otherwise treated as an
      Annual Addition under Code Section 415(l)(1).

      13.6 Treatment of 415 Suspense Account Upon Termination. In the event the
Plan shall terminate at a time when all amounts in the 415 Suspense Account have
not been allocated to the Accounts of the Participants, the 415 Suspense Account
amounts shall be applied as follows:

            (a) The amount in the 415 Suspense Account shall first be allocated,
      as of the Plan termination date, to Participants in accordance with the
      allocation formula applicable to Company Contributions provided under
      Section 6.3.

            (b) If, after those allocations have been made, any further residue
      funds remain in the 415 Suspense Account, the residue may revert to the
      Company in accordance with applicable provisions of the Code, ERISA, and
      the regulations thereunder.


                                       78
<PAGE>

                                  ARTICLE XIV
                                 TOP-HEAVY RULES

      14.1 Applicability. Notwithstanding any provision in the Plan to the
contrary, and subject to the limitations set forth in Section 14.6, the
requirements of Sections 14.4 and 14.5 shall apply under the Plan in the case of
any Plan Year in which the Plan is determined to be a Top-Heavy Plan under the
rules of Section 14.3. For the purpose of this Article XIV, the term "Company"
shall mean the Sponsor and any Affiliated Company whether or not such Affiliated
Company has adopted the Plan.

      14.2 Definitions. For purposes of this Article XIV, the following special
definitions and rules shall apply:

            (a) The term "Key Employee" means any Employee or former Employee
      (including any deceased Employee) who, at any time during the Plan Year
      that includes the Determination Date, was an officer of the Company having
      annual Compensation greater than $130,000 (as adjusted under Code Section
      416(i)(1) for Plan Years beginning after December 31, 2002), a Five
      Percent Owner of the Company, or an One Percent Owner of the Company
      having annual Compensation of more than $150,000.

            (b) The term "Five Percent Owner" means any person who owns (or is
      considered as owning within the meaning of Code Section 318) more than 5%
      of the outstanding stock of the Company or stock possessing more than 5%
      of the total combined voting power of all stock of the Company.

            (c) The term "One Percent Owner" means any person who would be
      described in paragraph (b) if "1%" were substituted for "5%" each place
      where it appears therein.

            (d) The term "Non-Key Employee" means any Employee who is not a Key
      Employee.

            (e) The term "Determination Date" means, with respect to any plan
      year, the last day of the preceding plan year. In the case of the first
      plan year of any plan, the term "Determination Date" shall mean the last
      day of that plan year.

            (f) The term "Aggregation Group" means (i) each qualified plan of
      the Company in which at least one Key Employee participates or
      participated at any time during the determination period (regardless of
      whether the plan has terminated), and (ii) any other qualified plan of the
      Company which enables a plan described in clause (i) to meet the
      requirements of Code Sections 401(a)(4) or 410. Any plan not required to
      be included in an Aggregation Group under the preceding rules may be
      treated as being part of such group if the group would continue to meet
      the requirements of Code Sections 401(a)(4) and 410 with the plan being
      taken into account.


                                       79
<PAGE>

            (g) For purposes of determining ownership under paragraphs (a), (b)
      and (c) above, the following special rules shall apply: (i) Code Section
      318(a)(2)(C) shall be applied by substituting "5%" for "50%", and (ii) the
      aggregation rules of Code Sections 414(b), (c) and (m) shall not apply,
      with the result that the ownership tests of this Section 14.2 shall apply
      separately with respect to each Affiliated Company.

            (h) The terms "Key Employee" and "Non-Key Employee" shall include
      their Beneficiaries, and the definitions provided under this Section 14.2
      shall be interpreted and applied in a manner consistent with the
      provisions of Code Section 416(i) and the regulations thereunder.

            (i) For purposes of this Article XIV, an Employee's Compensation
      shall be determined in accordance with the rules of Section 13.5.

      14.3 Top-Heavy Status.

            (a) The term "Top-Heavy Plan" means, with respect to any Plan Year:

                  (i) Any defined benefit plan if, as of the Determination Date,
            the present value of the cumulative accrued benefits under the plan
            for Key Employees exceeds 60% of the present value of the cumulative
            accrued benefits under the plan for all Employees; and

                  (ii) Any defined contribution plan if, as of the Determination
            Date, the aggregate of the account balances of Key Employees under
            the plan exceeds 60% of the aggregate of the account balances of all
            Employees under the plan.

            In applying the foregoing provisions of this paragraph (a), the
      valuation date to be used in valuing Plan assets shall be (i) in the case
      of a defined benefit plan, the same date which is used for computing costs
      for minimum funding purposes, and (ii) in the case of a defined
      contribution plan, the most recent valuation date within a 12-month period
      ending on the applicable Determination Date.

            (b) Each plan maintained by the Company required to be included in
      an Aggregation Group shall be treated as a Top-Heavy Plan if the
      Aggregation Group is a Top-Heavy Group.

            (c) The term "Top-Heavy Group" means any Aggregation Group if the
      sum (as of the Determination Date) of (i) the present value of the
      cumulative accrued benefits for Key Employees under all defined benefit
      plans included in the group, and (ii) the aggregate of the account
      balances of Key Employees under all defined contribution plans included in
      the group exceeds 60% of a similar sum determined for all Employees. For
      purposes of determining the present value of the cumulative accrued
      benefit of any Employee, or the amount of the account balance of any
      Employee, such present value or amount shall be increased by the aggregate
      distributions made with respect to the Employee under the plan (including
      a terminated plan which, had it not been terminated,


                                       80
<PAGE>

      would have been aggregated with the plan under Code Section
      416(g)(2)(A)(i)) during the one year period ending on the Determination
      Date. In the case of distributions made for a reason other than separation
      from service, death, or disability, the preceding sentence shall be
      applied by substituting "five year period" for "one year period." Any
      rollover contribution or similar transfer initiated by the Employee and
      made after December 31, 1983, to a plan shall not be taken into account
      with respect to the transferee plan for purposes of determining whether
      such plan is a Top-Heavy Plan (or whether any Aggregation Group which
      includes such plan is a Top-Heavy Group).

            (d) If any individual is a Non-Key Employee with respect to any plan
      for any plan year, but the individual was a Key Employee with respect to
      the plan for any prior plan year, any accrued benefit for the individual
      (and the account balance of the individual) shall not be taken into
      account for purposes of this Section 14.3.

            (e) If any individual has not performed services for the Company at
      any time during the one year period ending on the Determination Date, any
      accrued benefit for such individual (and the account balance of the
      individual) shall not be taken into account for purposes of this Section
      14.3.

            (f) In applying the foregoing provisions of this Section, the
      accrued benefit of a Non-Key Employee shall be determined (i) under the
      method, if any, which is used for accrual purposes under all plans of the
      Company and any Affiliated Companies, or (ii) if there is no such uniform
      method, as if such benefit accrued not more rapidly than the slowest
      accrual rate permitted under Code Section 411(b)(1)(C).

            (g) For all purposes of this Article XIV, the definitions provided
      under this Section 14.3 shall be applied and interpreted in a manner
      consistent with the provisions of Code Section 416(g) and the regulations
      thereunder.

      14.4 Minimum Contributions. For any Plan Year in which the Plan is
determined to be a Top-Heavy Plan, the minimum employer contributions for that
year shall be determined in accordance with the rules of this Section 14.4.

            (a) Except as provided below, the minimum contribution for each
      Non-Key Employee shall be not less than 3% of his or her compensation.
      Before Tax Deposits shall not be taken into account but Matching
      Contributions as defined in Section 6.11 shall be taken into account for
      purposes of satisfying the minimum contribution requirement. Matching
      Contributions that are used to satisfy the minimum contribution
      requirement shall be treated as matching contributions for purposes of the
      actual contribution percentage test and other requirements of Code Section
      401(m).

            (b) Subject to the following rules of this paragraph (b), the
      percentage set forth in paragraph (a) above shall not be required to
      exceed the percentage at which contributions (including amounts deferred
      under a cash or deferred arrangement under Code Section 401(k)) are made
      (or are required to be made) under the Plan for the year for the Key
      Employee for whom the percentage is the highest for the year. This


                                       81
<PAGE>

      determination shall be made by dividing the contributions for each Key
      Employee by so much of his or her total compensation for the Plan Year as
      does not exceed the applicable Compensation limit. For purposes of this
      paragraph (b), all defined contribution plans required to be included in
      an Aggregation Group shall be treated as one plan. Notwithstanding the
      foregoing, the exceptions to paragraph (a) as provided under this
      paragraph (b) shall not apply to any plan required to be included in an
      Aggregation Group if the plan enables a defined benefit plan to meet the
      requirements of Code Sections 401(a)(4) or 410.

            (c) The Participant's minimum contribution determined under this
      Section 14.4 shall be calculated without regard to any Social Security
      benefits payable to the Participant.

            (d) In the event a Participant is covered by both a defined
      contribution and a defined benefit plan maintained by the Company, both of
      which are determined to be Top-Heavy Plans, the Company shall satisfy the
      minimum benefit requirements of Code Section 416 by providing (in lieu of
      the minimum contribution described in paragraph (a) above) a minimum
      benefit under the defined benefit plan so as to prevent the duplication of
      required minimum benefits hereunder.

      14.5 Minimum Vesting Rules.. For any Plan Year in which it is determined
that the Plan is a Top-Heavy Plan, the vesting schedule for Matching
Contributions shall be the vesting schedule set forth in Section 7.2(a) and the
vesting schedule for Retirement Contributions shall be the vesting schedule set
forth in Section 7.2(b).

      14.6 Noneligible Employees.. The rules of this Article XIV shall not apply
to any Employee included in a unit of employees covered by a collective
bargaining agreement between employee representatives and one or more employers
if retirement benefits were the subject of good faith bargaining between such
employee representatives and the employer or employers.


                                       82
<PAGE>

                                   ARTICLE XV
                          RESTRICTION ON ASSIGNMENT OR
                        OTHER ALIENATION OF PLAN BENEFITS

      15.1 General Restrictions Against Alienation.

            (a) The interest of any Participant or his or her Beneficiary in the
      income, benefits, payments, claims or rights hereunder, or in the Trust
      Fund, shall not in any event be subject to sale, assignment,
      hypothecation, or transfer. Each Participant and Beneficiary is prohibited
      from anticipating, encumbering, assigning, or in any manner alienating his
      or her interest under the Trust Fund, and is without power to do so,
      except as may be permitted in connection with providing security for a
      loan from the Plan to the Participant pursuant to the provisions of the
      Plan as it may be amended from time to time. The interest of any
      Participant or Beneficiary shall not be liable or subject to his or her
      debts, liabilities, or obligations, now contracted, or which may hereafter
      be contracted, and such interest shall be free from all claims,
      liabilities, or other legal process now or hereafter incurred or arising.
      Neither the interest of a Participant or Beneficiary, nor any part
      thereof, shall be subject to any judgment rendered against any such
      Participant or Beneficiary. Notwithstanding the foregoing, a Participant's
      or Beneficiary's interest in the Plan may be subject to the enforcement of
      a Federal tax levy made pursuant to Code Section 6331 or the collection by
      the United States on a judgment resulting from an unpaid tax assessment.

            (b) In the event any person attempts to take any action contrary to
      this Article XV, such action shall be null and void and of no effect, and
      the Company, the Committee, the Trustee and all Participants and their
      Beneficiaries, may disregard such action and are not in any manner bound
      thereby, and they, and each of them, shall suffer no liability for any
      such disregard thereof, and shall be reimbursed on demand out of the Trust
      Fund for the amount of any loss, cost or expense incurred as a result of
      disregarding or of acting in disregard of such action.

            (c) The foregoing provisions of this Section shall be interpreted
      and applied by the Committee in accordance with the requirements of Code
      Section 401(a)(13) and Section 206(d) of ERISA as construed and
      interpreted by authoritative judicial and administrative rulings and
      regulations.

      15.2 Qualified Domestic Relations Orders. The rules set forth in Section
15.1 above shall not apply with respect to a "Qualified Domestic Relations
Order" as described below.

            (a) A "Qualified Domestic Relations Order" is a judgment, decree, or
      order (including approval of a property settlement agreement) that:

                  (i) Creates or recognizes the existence of an Alternate
            Payee's right to, or assigns to an Alternate Payee the right to,
            receive all or a portion of the benefits payable under the Plan with
            respect to a Participant,


                                       83
<PAGE>

                  (ii) Relates to the provision of child support, alimony
            payments, or marital property rights to a spouse, former spouse,
            child or other dependent of a Participant,

                  (iii) Is made pursuant to a State domestic relations law
            (including a community property law), and

                  (iv) Clearly specifies: (A) the name and last known mailing
            address (if any) of the Participant and the name and mailing address
            of each Alternate Payee covered by the order (if the Committee does
            not have reason to know that address independently of the order);
            (B) the amount or percentage of the Participant's benefits to be
            paid to each Alternate Payee, or the manner in which the amount or
            percentage is to be determined; (C) the number of payments or period
            to which the order applies; and (D) each plan to which the order
            applies.

            For purposes of this Section 15.2, "Alternate Payee" means any
      spouse, former spouse, child or other dependent of a Participant who is
      recognized by a domestic relations order as having a right to receive all,
      or a portion of, the benefits payable with respect to the Participant.

            (b) A domestic relations order is not a Qualified Domestic Relations
      Order if it requires:

                  (i) The Plan to provide any type or form of benefit, or any
            option, not otherwise provided under the Plan;

                  (ii) The Plan to provide increased benefits; or

                  (iii) The payment of benefits to an Alternate Payee that are
            required to be paid to another Alternate Payee under a previous
            Qualified Domestic Relations Order.

            (c) A domestic relations order shall not be considered to fail to
      satisfy the requirements of paragraph (b)(i) above with respect to any
      payment made before a Participant has separated from service solely
      because the order requires that payment of benefits be made to an
      Alternate Payee:

                  (i) On or after the date on which the Participant attains (or
            would have first attained) his or her earliest retirement age (as
            defined in Code Section 414(p)(4)(B));


                                       84
<PAGE>

                  (ii) As if the Participant had retired on the date on which
            such payment is to begin under such order (but taking into account
            only the present value of accrued benefits and not taking into
            account the present value of any subsidy for early retirement
            benefits); and

                  (iii) In any form in which such benefits may be paid under the
            Plan to the Participant (other than in the form of a joint and
            survivor annuity with respect to the Alternate Payee and his or her
            subsequent spouse).

            Notwithstanding the foregoing, if the Participant dies before his or
      her earliest retirement age (as defined in Code Section 414(p)(4)(B)), the
      Alternate Payee is entitled to benefits only if the Qualified Domestic
      Relations Order requires survivor benefits to be paid to the Alternate
      Payee.

            (d) To the extent provided in any Qualified Domestic Relations
      Order, the former spouse of a Participant shall be treated as a surviving
      Spouse of the Participant for purposes of applying the rules (relating to
      minimum survivor annuity requirements) of Code Sections 401(a)(11) and
      417, and any current spouse of the Participant shall not be treated as a
      spouse of the Participant for such purposes.

            (e) In the case of any domestic relations order received by the
      Plan, the Committee shall promptly notify the Participant and any
      Alternate Payee named in the order that an order has been received and
      shall provide a copy of the Plan's procedures for determining the
      qualified status of domestic relations orders. An Alternate Payee may
      designate a representative for receipt of copies of notices and plan
      information that are sent to the Alternate Payee with respect to domestic
      relations order. Within a reasonable period after the receipt of the
      order, the Committee shall determine whether the order is a Qualified
      Domestic Relations Order and shall notify the Participant and each
      Alternate Payee of such determination.

            (f) The Committee shall establish reasonable procedures to determine
      the qualified status of domestic relations orders and to administer
      distributions under Qualified Domestic Relations Orders. During any period
      in which the issue of whether a domestic relations order is a Qualified
      Domestic Relations Order is being determined (by the Committee, by a court
      of competent jurisdiction, or otherwise), the Committee shall direct the
      Trustee to segregate in a separate account in the Plan (or in an escrow
      account) the amounts which would have been payable to the Alternate Payee
      during the period if the order had been determined to be a Qualified
      Domestic Relations Order. If within the 18 Month Period (as defined
      below), the order (or modification thereof) is determined to be a
      Qualified Domestic Relations Order, the Committee shall direct the Trustee
      to pay the segregated amounts (plus any interest thereon) to the person or
      persons entitled thereto. However, if within the 18 Month Period (i) it is
      determined that the order is not a Qualified Domestic Relations Order, or
      (ii) the issue as to whether the order is a Qualified Domestic Relations
      Order is not resolved, then the Committee shall direct the Trustee to pay
      the segregated amounts (plus any interest thereon) to the person or
      persons who would have been entitled to the amounts if there had been no
      order (assuming such


                                       85
<PAGE>

      benefits were otherwise payable). Any determination that an order is a
      Qualified Domestic Relations Order that is made after the close of the 18
      Month Period shall be applied prospectively only. For purposes of this
      Section 15.2, the "18 Month Period" shall mean the 18 month period
      beginning with the date on which the first payment would be required to be
      made under the domestic relations order.


                                       86
<PAGE>

                                  ARTICLE XVI
                            MISCELLANEOUS PROVISIONS

      16.1 No Right of Employment Hereunder. The adoption and maintenance of the
Plan and Trust shall not be deemed to constitute a contract of employment or
otherwise between the Company and any Employee or Participant, or to be a
consideration for, or an inducement or condition of, any employment. Nothing
contained herein shall be deemed to give any Employee the right to be retained
in the service of the Company or to interfere with the right of the Company to
discharge, with or without cause, any Employee or Participant at any time, which
right is hereby expressly reserved.

      16.2 Effect of Article Headings. Article headings are for convenient
reference only and shall not be deemed to be a part of the substance of this
instrument or in any way to enlarge or limit the contents of any Article.

      16.3 Limitation on Company Liability. Any benefits payable under the Plan
shall be paid or provided for solely from the Plan and the Company assumes no
liability or responsibility therefor.

      16.4 Gender. Masculine gender shall include the feminine and the singular
shall include the plural unless the context clearly indicates otherwise.

      16.5 Interpretation. The provisions of the Plan shall in all cases be
interpreted in a manner that is consistent with the Plan satisfying (i) the
requirements of Code Section 401(a) and related statutes for qualification as a
defined contribution plan and (ii) the requirements of Code Section 401(k) and
related statutes for qualification as a cash or deferred arrangement.

      16.6 Withholding For Taxes. Any payments from the Trust Fund may be
subject to withholding for taxes as may be required by any applicable federal or
state law.

      16.7 California Law Controlling. All legal questions pertaining to the
Plan which are not controlled by ERISA shall be determined in accordance with
the laws of the State of California and all contributions made hereunder shall
be deemed to have been made in that State.

      16.8 Plan and Trust as One Instrument. The Plan and the Trust Agreement
shall be construed together as one instrument. In the event that any conflict
arises between the terms and/or conditions of the Trust Agreement and the Plan,
the provisions of the Plan shall control, except that with respect to the duties
and responsibilities of the Trustee, the Trust Agreement shall control.

      16.9 Invalid Provisions. If any paragraph, section, sentence, clause or
phrase contained in the Plan shall become illegal, null or void or against
public policy, for any reason, or shall be held by any court of competent
jurisdiction to be incapable of being construed or limited in a manner to make
it enforceable, or is otherwise held by such court to be illegal, null


                                       87
<PAGE>

or void or against public policy, the remaining paragraphs, sections, sentences,
clauses or phrases contained in the Plan shall not be affected thereby.

      16.10 Counterparts. This instrument may be executed in one or more
counterparts each of which shall be legally binding and enforceable.


                                       88
<PAGE>

      IN WITNESS WHEREOF, Allergan, Inc. hereby executes this instrument,
evidencing the terms of the Allergan, Inc. Savings and Investment Plan as
restated this 18th day of December, 2002.

ALLERGAN, INC.


By:             /s/ Douglas Ingram
   ----------------------------------------------
      Douglas Ingram
      Corporate Vice President, General Counsel
      and Secretary


                                       89
<PAGE>
                                   APPENDIX A
           SPECIAL PROVISIONS FOR PUERTO RICO-BASED PAYROLL EMPLOYEES

                                     PART I
                                  INTRODUCTION

      1.1 Effective Date. The effective date of this Appendix A is January 1,
2003.

      1.2 Purpose of Appendix A. The provisions of the Plan shall apply to all
Puerto Rico-based payroll Employees except as specifically provided in this
Appendix A.

      1.3 Plan Qualification. The Plan is an employee benefit plan that is
intended to qualify under PR-Code Section 1165(a) as a qualified profit sharing
plan and under PR-Code Section 1165(e) as a qualified cash or deferred
arrangement.

                                     PART II
                                   DEFINITIONS

      The Definitions of Article II of the Plan shall apply to all Puerto
Rico-based Employees and shall have the same meaning for the purpose of this
Appendix A except as set forth below:

      2.1 Plan Section 2.17. "Compensation" shall have the same meaning as set
forth in Plan Section 2.17 except that in the case of a Puerto Rico-based
Employee, Compensation shall also include cost of living allowances earned
within Puerto Rico, amounts paid under the Christmas bonus program, and amounts
of salary reduction elected by a Puerto Rico-based Participant under a PR-Code
Section 1165(e) cash or deferred arrangement, but shall exclude contributions or
distributions pursuant to any other plan sponsored by the Company and qualified
under PR-Code Section 1165(a).

      2.2 Plan Section 2.18. "Credited Service" shall have the same meaning as
set forth in Plan Section 2.18 except that in the case of a Puerto Rico-based
Employee who was employed by the Company at any time prior to the Original
Effective Date, for the period prior to January 1, 1989, Credited Service shall
include service, if any, credited to such Employee under the Savings and
Investment Plan for Employees of Subsidiaries of SmithKline Beckman Corporation
Whose Principal Office is Located in Puerto Rico.

      2.3 Plan Section 2.21. For the purpose of this Appendix A only, the
definition of "Eligible Employee" as defined in Plan Section 2.21 shall not
apply and "Eligible Employee" or "Eligible Puerto Rico-based Employee" shall
mean any Puerto Rico-based Employee but shall exclude any non-regular
manufacturing site transition employee, any non-resident alien of Puerto Rico
and the United States, any Leased Employee, and any Employee covered by a
collective bargaining agreement.

<PAGE>

      2.4 Plan Section 2.24. For the purpose of this Appendix A only, the
definition of "Employee" as defined in Plan Section 2.24 shall not apply and
"Employee" or "Puerto Rico-based Employee" shall mean any person who is employed
in any capacity by the Sponsor or any Affiliated Company at its Puerto Rico
locations, any portion of whose income is subject to withholding of income tax
and/or for whom Social Security contribution are made by the Sponsor or an
Affiliated Company except that such term shall not include (i) any individual
who performs services for the Sponsor or an Affiliated Company and who is
classified or paid as an independent contractor as determined by the payroll
records of the Sponsor or an Affiliated Company even if a court or
administrative agency determines that such individual is a common-law employee
and not an independent contractor and (ii) any individual who performs services
for the Sponsor or an Affiliated Company pursuant to an agreement between the
Sponsor or an Affiliated Company and any other person including a leasing
organization except to the extent such individual is a Leased Employee.

      2.5 Plan Section 2.38. For the purpose of this Appendix A only,
"Participant" as defined in Plan Section 2.38 shall not apply and "Participant"
or "Puerto Rico-based Participant" shall mean a Puerto Rico-based Employee or
former Puerto Rico-based Employee who has commenced participation in the Plan
pursuant to Section 3.1 and who retains rights under the Plan.

      2.6 Additional Terms. Additional terms shall have the following meaning:

            (a) "PR-Code" shall mean the Puerto Rico Internal Revenue Code of
      1994, as amended. Where the context so requires a reference to a
      particular PR-Code Section shall also refer to any successor provision of
      the PR-Code to such PR-Code Section.

            (b) "Top One-Third Highly Compensated Employee" shall mean any
      Eligible Puerto Rico-based Employee who has Compensation for a Plan Year
      that is greater than the Compensation for such Plan Year of two-thirds
      (2/3) of all Eligible Puerto Rico-based Employees.

                                    PART III
                          ELIGIBILITY AND PARTICIPATION

      The provisions of Article III of the Plan shall apply to all Puerto
Rico-based Employees.

                                     PART IV
                              PARTICIPANT DEPOSITS

      The provisions of Article IV of the Plan shall apply to all Puerto
Rico-based Employees except as set forth below:


                                      A-2
<PAGE>

      4.1 Plan Section 4.1. The provisions of Plan Section 4.1(d) shall apply to
all Puerto Rico-based Participants except that Puerto Rico-based Participants
who make hardship withdrawals pursuant to Plan Section 8.1(e) shall not be
permitted to make Before Tax Deposits or After Tax Deposits to the Plan during
the 12-month period beginning as soon as administratively feasible following the
date of the hardship withdrawal. Also, to the extent permissible by ERISA and
the Code, each contribution made by the Company to the Plan under Plan Section
4.1 with respect to the Before Tax Deposits of a Puerto Rico-based Participant
shall be made only to the extent that the Company has current or accumulated
earnings and profits, as determined under the PR-Code, and is expressly
conditioned on the deductibility of such contribution under Section 1023(n) of
the PR-Code for the taxable year for which contributed. If the Puerto Rico
Secretary of the Treasury disallows the deduction, or if the contribution was
made by a mistake of fact, such contribution shall be returned to the Company
within one (1) year after the disallowance of the deduction (to the extent
disallowed), or after the payment of such contribution, respectively. Such
contributions to the Plan by the Company shall be paid to the Trustee not later
than the date for filing the Company's Puerto Rico income tax return for the
taxable year in which such payroll period falls, including any extensions
thereof.

      4.2 Plan Section 4.2. The provisions of Plan Section 4.2 shall apply to
all Puerto Rico-based Employees except as set forth below:

      (a) Notwithstanding the provisions of paragraph (a) of Plan Section 4.2, a
Puerto Rico-based Participant may elect to contribute a whole percentage of his
or her Compensation to the Plan as Before Tax Deposits; provided, however, that
no Puerto Rico-based Participant shall be permitted to make Before Tax Deposits
to the Plan during any taxable year in excess of: (i) ten percent (10%) of
Compensation up to a maximum of $8,000, or such larger amount as may be
determined by the Puerto Rico Secretary of the Treasury pursuant to the PR-Code;
provided that, if a Puerto Rico-based Participant contributes to a Puerto Rico
individual retirement account as described in PR-Code Section 1169, the maximum
amount of his or her Before Tax Deposits may not exceed the difference, if any,
between the amount available as a contribution up to the limit of $8,000 and the
contribution made to a Puerto Rico individual retirement account, or as
otherwise provided by the PR-Code, (ii) the Actual Deferral Percentage test
limitation set forth in Plan Section 4.3 and Section 4.3 of this Appendix, and
(iii) the Annual Addition limitation set forth in Plan Section 13.1.

      (b) The provisions of paragraph (e) of Plan Section 4.2 pertaining to
"catch-up" Before Tax Deposits shall not apply to Puerto Rico-based
Participants.

      4.3 Additional Contribution Deferral Limitation. In addition to the
limitations on Compensation Deferral Contributions set forth in Plan Section
4.3, Compensation Deferral Contributions by a Puerto Rico-based Participant
shall not exceed the limitation on contributions by or on behalf of the Top
One-Third Highly Compensation Employees under PR-Code Section 1165(e), as
provided in this Section 4.3 with respect to each Plan Year. In the event that
Compensation Deferrals Contributions under the Plan by or on behalf of the Top
One-Third Highly Compensated Employees exceed the limitations of this Section
for any reason, such excess contributions shall be recharacterized as After Tax
Deposits or such excess contributions, adjusted for any income or loss allocable
thereto, shall be returned to such Participant, as provided in Plan Section 4.5.


                                      A-3
<PAGE>

             (a) The Compensation Deferral Contributions by Participants for a
      Plan Year shall satisfy the Actual Deferral Percentage test under the
      PR-Code as set forth in subparagraph (i) below, or to the extent not
      precluded by applicable regulations, the alternate Actual Deferral
      Percentage test as set forth in (ii) below:

                  (i) The average "Actual Deferral Percentage" for the Top
            One-Third Highly Compensated Employees shall not be more than the
            average Actual Deferral Percentage of all non-Top One-Third Highly
            Compensated Employees multiplied by 1.25, or

                  (ii) The excess of the average Actual Deferral Percentage for
            the Top One-Third Highly Compensated Employees over the average
            Actual Deferral Percentage for all non-Top One-Third Highly
            Compensated Employees shall not be more than two (2) percentage
            points and the average Actual Deferral Percentage for the Top
            One-Third Highly Compensated Employee shall not be more than the
            average Actual Deferral Percentage of all non-Top One-Third Highly
            Compensated Employees multiplied by 2.0.

            (b) For the purpose of this Section 4.3 only, the following
      definitions shall apply:

                  (i) "Actual Deferral Percentage" shall mean, with respect to
            the group of all Top One-Third Highly Compensated Employees and the
            group of all non-Top One-Third Highly Compensated Employees for a
            Plan Year, the ratio, calculated separately for each Participant in
            such group, of the amount of the Participant's Compensation Deferral
            Contribution for such Plan Year, to such Participant's Compensation
            for such Plan Year, in accordance with regulations prescribed by the
            Puerto Rico Secretary of the Treasury under PR-Code Section 1165(e).
            For purposes of computing the Actual Deferral Percentage, an
            Eligible Employee who would be a Participant but for the failure to
            make Before Tax Deposits shall be treated as a Participant on whose
            behalf no Before Tax Deposits are made.

                  (ii) "Participant" shall mean any Eligible Puerto Rico-based
            Employee who satisfied the requirements under Plan Article III
            during the Plan Year, whether or not such Eligible Employee elected
            to contribute to the Plan for such Plan Year.

                  (iii) "Compensation Deferral Contributions" shall mean amounts
            contributed to the Plan by a Participant as Before Tax Deposits
            pursuant to Section 4.1 of this Appendix, including any other
            amounts prescribed under PR-Code Section 1165(e) and applicable
            regulations. To the extent determined by the Committee and in
            accordance with regulations issued by the Puerto Rico Secretary of
            the Treasury, matching contributions and qualified nonelective
            contributions on behalf of a Participant that satisfy the
            requirements of PR-Code Section 1165(e)(3)(D)(ii) may also be taken
            into account for the purpose of determining the Actual Deferral
            Percentage of such Participant.


                                      A-4
<PAGE>

                   (iv) "Compensation" shall mean compensation as defined in
            PR-Code Section 1165(e) and applicable regulations.

            (c) In the event that as of the first day of Plan Year, the Plan
      satisfies the requirements of PR-Code Section 1165(a) only if aggregated
      with one or more other plans which include arrangements under PR-Code
      Section 1165(e), then this Section 4.3 shall be applied by determining the
      Actual Deferral Percentages of Participants as if all such plans were a
      single plan, in accordance with regulations prescribed by the Secretary of
      the Treasury under PR-Code Section 1165(e). Plans may be considered one
      plan for purposes of satisfying PR-Code Section 1165(e) only if they have
      the same Plan Year.

            (d) For the purpose of this Section 4.3, the "Actual Deferral
      Percentage" for any Top One-Third Highly Compensated Employee who is a
      Participant under two or more PR-Code Section 1165(e) arrangements of the
      Company shall be determined by taking into account the Top One-Third
      Highly Compensated Employee's Compensation under each such arrangement and
      contributions under each such arrangement which qualify for treatment
      under PR-Code Section 1165(e) in accordance with regulations prescribed by
      the Puerto Rico Secretary of the Treasury under PR-Code Section 1165(e).
      If the arrangements have different Plan Years, this paragraph shall be
      applied by treating all such arrangements ending with or within the same
      calendar year as a single arrangement. Notwithstanding the foregoing,
      certain plans shall be treated as separate plans if mandatorily
      disaggregated pursuant to regulations under Code Section 401(k).

            (e) For purposes of the Actual Deferral Percentage test under the
      PR-Code, Compensation Deferral Contributions must be made before the last
      day of the twelve-month period immediately following the Plan Year to
      which such contributions relate.

            (f) The determination and treatment of Compensation Deferral
      Contributions and the Actual Deferral Percentage of any Participant under
      this Section 4.3 shall satisfy such other requirements as may be
      prescribed by the Puerto Rico Secretary of the Treasury.

            (g) The Committee shall keep or cause to have kept such records as
      are necessary to demonstrate that the Plan satisfies the requirements of
      PR-Code Section 1165(e) and the regulations thereunder, in accordance with
      regulations prescribed by the Puerto Rico Secretary of the Treasury.

            (h) Notwithstanding any provision of this Appendix A to the
      contrary, to the extent permitted by the PR-Code and its regulations, all
      Employees employed by the Sponsor and any Affiliated Company that
      participates in the Plan may be aggregated for purposes of determining
      compliance by the Plan with the Actual Deferral Percentage test under the
      PR-Code and the determination of Top One-Third Highly Compensated
      Employees.

      4.4 Plan Section 4.4. The provisions of Plan Section 4.4 entitled
"Provisions for Return of Excess Before Tax Deposits" shall be applied by
substituting the dollar limitation


                                      A-5
<PAGE>

contained in Section 4.2 of this Appendix for the "Before Tax Deposit Limit" in
each place it appears.

      4.5 Plan Section 4.5. The provisions of Plan Section 4.5 entitled
"Provision for Recharacterization or Return of Excess Deferrals by Highly
Compensated Participants" shall be applied as follows:

            (a) "Highly Compensated Participant and Top One-Third Highly
      Compensated Employee" shall be substituted for "Highly Compensated
      Participant" in each place it appears.

            (b) For purposes of satisfying the Actual Deferral Percentage test
      under the PR-Code, the amount of any excess Compensation Deferral
      Contributions by a Top One-Third Highly Compensated Employee shall be
      determined by the Committee taking into account the leveling method
      applied under the PR-Code and its regulations that provide that the
      leveling method shall begin with the Top One-Third Highly Compensated
      Employee who has the highest deferral percentage.

            (c) Any reference to Code Sections shall include reference to the
      corresponding PR-Code Section unless the context clearly indicates
      otherwise. For example, references to "Code Section 401(k)" and "Code
      Section 404" shall include references to PR-Code Section 1165(e) and
      PR-Code Section 1023(n), respectively.

      4.6 Reserved for Future Modification.

      4.7 Plan Section 4.7. In addition to the provisions of Plan Section 4.7
entitled "Character of Deposits," Before Tax Deposits shall be treated as
employer contributions for purposes of PR-Code Section 1165(e).

      4.8 Plan Section 4.8. For purposes of Plan Section 4.8, a "Direct Rollover
Contribution" or a "Participant Rollover Contribution" from a retirement plan
qualified under PR-Code Section 1165(a) (unless such plan is also qualified
under Code Section 401(a)) or an "IRA Rollover Contribution" from a Puerto-Rico
individual retirement account or annuity shall not be permitted under the Plan.

                                     PART V
                      TRUST FUND AND MATCHING CONTRIBUTIONS

      The provisions of Article V shall apply to all Puerto Rico-based Employees
except as set forth below:

      5.1 Plan Section 5.6. The provisions of Plan Section 5.6 entitled
"Irrevocability" shall be applied by including a corresponding reference to
"PR-Code Section 1165(a)" and "PR-Code Section 1023(n)" in each place "Code
Section 401(a)" and "Code Section 404" appears, respectively.


                                      A-6
<PAGE>

                                     PART VI
                            ACCOUNTS AND ALLOCATIONS

      The provisions of Article VI of the Plan shall apply to all Puerto
Rico-based Employees.

                                    PART VII
                            VESTING IN PLAN ACCOUNTS

      The provisions of Article VII of the Plan shall apply to all Puerto
Rico-based Employees.

                                    PART VIII
                            PAYMENT OF PLAN BENEFITS

      The provisions of Article VIII of the Plan shall apply to all Puerto
Rico-based Employees except as set forth below:

      8.1 Plan Section 8.2(a). For purposes of Plan Section 8.2(a), a Puerto
Rico-based Participant may elect, at the time and in the manner prescribed by
the Committee, to have the entire portion of a lump-sum distribution from the
Plan paid directly to a qualified trust described in PR-Code Section 1165(a)
that accepts the Puerto Rico-based Participant's distribution or an individual
retirement account or annuity described in PR-Code Sections 1169(a) and (b),
respectively.

      8.2 Plan Section 8.4. In addition to the provisions of Plan Section 8.4
entitled "Designation of Beneficiary," the following rules shall apply to a
Participant, as defined in Section 2.6 of this Appendix:

            (a) In the event a deceased Participant is not a resident of Puerto
      Rico at the date of his or her death, the Committee, in its discretion,
      may require the establishment of ancillary administration in Puerto Rico.

            (b) If the Committee cannot locate a qualified personal
      representative of the deceased Participant, or if administration of the
      deceased Participant's estate is not otherwise required, the Committee, in
      its discretion, may pay the deceased Participant's interest in the Trust
      Fund to his or her heirs at law (determined in accordance with the laws of
      the Commonwealth of Puerto Rico) as they existed at the date of the
      Participant's death.

      8.3 Plan Section 8.5. Notwithstanding the provisions of Plan Section 8.5,
a hardship withdrawal shall be made to a Puerto Rico-based Participant only if
the Committee (or its representative), based upon the Participant's
representation and such other facts as are known to the Committee, determines
that the requested withdrawal is on the account of:


                                      A-7
<PAGE>

            (a) A deductible medical expense (within the meaning of PR-Code
      Section 1023(aa)(2)(p)) incurred by the Participant, his or her spouse,
      children or dependents;

            (b) The purchase (excluding mortgage payments) of a principal
      residence for the Participant;

            (c) The payment of tuition for the next twelve (12) months of
      post-secondary education for the Participant, the Participant's spouse,
      children, or dependents;

            (d) The need to prevent the eviction of the Participant from his or
      her principal residence or foreclosure on the mortgage of the
      Participant's principal residence; and

            (e) Such other events as the PR-Code, regulations or the Puerto Rico
      Secretary of the Treasury may allow.

      Notwithstanding anything in the Plan to the contrary, Puerto Rico-based
Participants who make hardship withdrawals pursuant to Plan Section 8.1(e) shall
not be permitted to make Before Tax Deposits or After Tax Deposits to the Plan
during the 12-month period beginning as soon as administratively feasible
following the date of the hardship withdrawal.

      8.4 Plan Section 8.6(a). Notwithstanding the provisions of Plan Section
8.6(a) entitled "Distribution Rules," in the case of a Puerto Rico-based
Participant in no event shall any benefits under the Plan, including benefits
upon retirement, Severance, or Disability, be paid (or commence to be paid) to a
participant prior to the "Consent Date" (as defined herein) unless the
Participant consents in writing to the payment (or commencement of payment) of
such benefits prior to said Consent Date. As used herein, the term "Consent
Date" shall mean the later of (i) the Participant's 62nd birthday, or (ii) the
Participant's Normal Retirement Age. Notwithstanding the foregoing, the
provisions of this Paragraph shall not apply (i) following the Participant's
death, or (ii) with respect to a lump sum distribution of the vested portion of
a Participant's Accounts if the total amount of such vested portion does not
exceed or has never exceeded $5,000.

      8.5 Plan Section 8.6(c). Notwithstanding the provisions of Plan Section
8.6(c) entitled "Distribution Rules," Section 8.3 of this Appendix or Plan
Section 8.6(b), in the case of a Puerto Rico-based Participant distributions of
the entire vested portion of a Participant's Accounts shall be made no later
than the Participant's Required Beginning Date, or, if such distribution is to
be made over the life of such Participant or over the lives of such Participant
and a Beneficiary (or over a period not extending beyond the life expectancy of
such participant and Beneficiary) then such distribution shall commence no later
than the Participant's Required Beginning Date. Required Beginning Date shall
mean:

             (a) For the period prior to January 1, 1989, April 1 of the
      calendar year following the later of the calendar year in which the
      Participant (i) attains age 70-1/2, or (ii) retires; provided, however,
      the foregoing clause (ii) shall not apply with respect to a Participant
      who is a Five Percent Owner (as defined in Code Section 416(i)) at any
      time


                                      A-8
<PAGE>

      during the five Plan Year period ending in the calendar year in which the
      Participant attains age 70-1/2. If the Participant becomes a Five Percent
      Owner during any Plan Year subsequent to the five Plan Year period
      referenced above, the Required Beginning Date under this Paragraph (a)
      shall be April 1 of the calendar year following the calendar year in which
      such subsequent Plan year ends.

            (b) For the period after December 31, 1988, April 1 of the calendar
      year following the calendar year in which the Participant attains age
      70-1/2; provided, however, if the Participant attains age 70-1/2 before
      January 1, 1988 and the Participant was not a Five Percent Owner at any
      time during the Plan Year ending with or within the calendar year in which
      such Participant attains age 66-1/2 or any subsequent Plan Year, then this
      Paragraph (b) shall not apply and the Required Beginning Date shall be
      determined under Paragraph (a) above.

      8.6 Plan Section 8.11(c). The provisions of Plan Section 8.11(c) entitled
"Additional Documents" shall be applied by including reference to "Puerto Rico"
in each place "State or Federal" appears.

      8.7 Plan Section 8.12. The provisions of Plan Section 8.12 entitled
"Trustee-Trustee Transfers" shall be applied by including a corresponding
reference to "PR-Code Section 1165" in each place "Code Section 401" appears.

                                     PART IX
                           PLAN ARTICLES IX THROUGH XI

      The provisions of Articles IX through XI of the Plan shall apply to all
Puerto Rico-based Employees.

                                     PART X
                             TERMINATION AND MERGER

      The provisions of Articles XII of the Plan shall apply to all Puerto
Rico-based Employees except as follows:

      10.1 Plan Section 12.1. In addition to the provisions of Plan Section
12.1, the Committee may determine that no distributions shall be made to a
Puerto Rico-based Participant in the event the Plan is terminated, until such
time as the Puerto Rico Department of the Treasury shall have determined in
writing that such termination will not adversely affected the prior
qualification of the Plan under the PR-Code.

      10.2 Plan Section 12.2. In addition to the provisions of Plan Section
12.2, any merger or consolidation of the Plan with, or transfer in whole or in
part of the assets and liabilities of the


                                      A-9
<PAGE>

Trust to, another trust fund as applied to a Puerto Rico-based Participant will
be limited to the extent such other plan and trust are qualified under PR-Code
Section 1165(a).

                                     PART IX
                           PLAN ARTICLES IX THROUGH XV

      The provisions of Articles IX through XV of the Plan shall apply to all
Puerto Rico-based Employees.


                                      A-10
<PAGE>

                                     PART X
                            MISCELLANEOUS PROVISIONS

      The provisions of Article XVI of the Plan shall apply to all Puerto
Rico-based Employees except as follows:

      10.1 Plan Section 16.5. In addition to the provisions of Plan Section 16.5
entitled "Interpretation," the provisions of the Plan shall be interpreted in a
manner consistent with the Plan satisfying (i) the requirements of PR-Code
Section 1165(a) and related statutes for qualification as a defined contribution
plan and (ii) the requirements of PR-Code Section 1165(e) and related statutes
for qualification as a cash or deferred arrangement to the extent such
interpretation would not violate (i) the requirements of Code Section 401(a) and
related statutes for qualification as a defined contribution plan and (ii) the
requirements of Code Section 401(k) and related statutes for qualification as a
cash or deferred arrangement.

      10.2 Plan Section 16.6. In addition to the provisions of Plan Section 16.6
entitled "Withholding for Taxes," any payments from the Trust Fund may be
subject to withholding for taxes as may be required by any applicable Puerto
Rico law.

      10.3 Plan Section 16.7. In addition to the provisions of Plan Section 16.7
entitled "California Law Controlling," the Committee shall determine whether all
legal questions pertaining to the Plan which are not controlled by ERISA shall
be determined in accordance with the laws of the Commonwealth of Puerto Rico or
the laws of the State of California in the case of a Puerto Rico-based Employee
or Participant.

                                      A-11