EXHIBIT 10.3


                             SNYDER OIL CORPORATION
                           DEFERRED COMPENSATION PLAN
                              FOR SELECT EMPLOYEES
         AS ADOPTED FEBRUARY 23, 1994, AS AMENDED THROUGH APRIL 2, 1997

ARTICLE 1 -- INTRODUCTION

1.1     PURPOSE OF THE PLAN

The  Employer  has adopted the Plan set forth herein to provide a means by which
certain  employees  may elect to defer  receipt  of  designated  percentages  or
amounts of their Compensation and to provide a means for certain other deferrals
of compensation.

1.2     STATUS OF PLAN

The Plan is intended to be a "plan which is  unfunded  and is  maintained  by an
employer  primarily  for the purpose of providing  deferred  compensation  for a
select group of management or highly  compensated  employees" within the meaning
of Sections 201(2) and 301(a)(3) of the Employee  Retirement Income Security Act
of 1974  ("ERISA"),  and shall be  interpreted  and  administered  to the extent
possible in a manner consistent with that intent.

ARTICLE 2 -- DEFINITIONS

Whenever  used herein,  the  following  terms have the meanings set forth below,
unless a different meaning is clearly required by the context:

2.1 ACCOUNT means, for each Participant,  the account established for his or her
benefit under Section 5.1.

2.2 CHANGE OF CONTROL means (a) the purchase or other acquisition in one or more
transactions other than from the Employer, by any individual, entity or group of
persons  within  the  meaning  of Section  13(d)(3)  or 14(d) of the  Securities
Exchange  Act of 1934 or any  comparable  successor  provisions,  of  beneficial
ownership (within the meaning of Rule 13d- 3 of the Securities  Exchange Act) of
50  percent or more of either  that  outstanding  shares of common  stock or the
combined voting power of Employer's then outstanding voting securities  entitled
to vote  generally  or (b) in  connection  or as a result of any  tender  offer,
exchange  offer,  merger or other  business  combination  or proxy  contest  the
directors  prior to such event no longer  constitute a majority of the directors
of  Employer,  or  (c)  the  approval  by  stockholders  of  the  Employer  of a
reorganization,  merger,  consolidation or other business  combination,  in each
case,  with  respect to which  persons  who were  stockholders  of the  Employer
immediately prior to such event do not immediately  thereafter own more than 50%
of the  combined  voting  power  of the  reorganized,  merged,  consolidated  or
combined  Employer's  then  outstanding  securities  that are  entitled  to vote
generally in the election of directors or (d) the liquidiation or dissolution of
Employer or sale of all or substantially all of the Employer's assets.

2.3 CODE means the Internal Revenue Code of 1986, as amended, from time to time.
Reference to any section or  subsection  of the Code  included  reference to any
comparable or succeeding provisions of any legislation which amends, supplements
or replaces such section or subsection.

2.4  COMPENSATION  means the regular or base salary and cash bonuses  payable by
the  Employer  or an  Affiliate  to an  individual.  For  purposes  of the Plan,
Compensation will be determined  before giving effect to Elective  Deferrals and
other salary reduction amounts which are not included in the Participant's gross
income under Sections 125, 401(k), 402(h) or 403(b) of the Code.

For purposes of the Plan, bonuses shall be deemed to have been earned during the
Plan Year in which the  Employer  accrues  such  bonuses for federal  income tax
reporting  purposes.  Under the Employer's  present method of federal income tax
reporting,  regular  bonuses  paid in March of a given year are accrued  ratably
during the prior year. Regular salary and special bonuses,  as designated by the
Board of Directors or the Compensation Committee of the Board of Directors of

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Employer,  are included in Compensation at the time paid to the employee.  Thus,
for example,  Compensation  for the Plan Year ending  December 31, 1995 includes
regular salary paid during 1995 and any regular bonus paid during March 1996. As
a result  an  Elective  Deferral  to defer,  say,  10% of a  Participant's  1995
Compensation  will result in the deferral  hereunder of 10% of the Participant's
1995 salary and 10% of any regular bonus paid to the  Participant  in March 1996
(any regular bonus payable in March 1995 would not be affected to an election to
defer a portion of 1995 Compensation, since such bonus would be included in 1994
Compensation).

2.5  DISABILITY  means a  Participant's  total and permanent  mental or physical
disability  resulting in termination of employment as evidenced by  presentation
of medical evidence satisfactory to the Administrator.

2.6     EFFECTIVE DATE means June 1, 1994.

2.7  ELECTION  FORM  means  the  participation  election  form as  approved  and
prescribed by the Plan Administrator.

2.8 ELECTIVE DEFERRAL means the portion of Compensation during a Plan Year which
is deferred by a Participant under Section 4.1.

2.9  ELIGIBLE  EMPLOYEE  means,  on the  Effective  Date  or on any  Entry  Date
thereafter,  those  employees  of the  Employer  selected  by  the  Compensation
Committee  of the Board of  Directors  of  Employer  or by such  persons  as the
Compensation Committee may authorize to select employees entitled to participate
in the Plan.

2.10 ENTRY DATE means,  for each  Participant,  the date  deferrals  commence in
accordance with Section 4.1.

2.11  EMPLOYER  means Snyder Oil  Corporation,  any  successor to all or a major
portion of its assets or business which assumes the obligations of Employer, and
each other entity that is affiliated with the Employer that adopts the Plan with
the consent of the Employer, provided that Snyder Oil Corporation shall have the
sole  power to amend this Plan and shall be the Plan  Administrator  if no other
person or entity is so serving at any time.

2.12 ERISA means the Employee Retirement Income Security Act of 1974, as amended
from time to time.  Reference  to any section or  subsection  of ERISA  includes
reference to any comparable or succeeding  provisions of any  legislation  which
amends, supplements or replaces such section or subsection.

2.13 INCENTIVE CONTRIBUTION means a discretionary  additional  contribution made
by Employer as described in Section 4.3.

2.14 INSOLVENT  means either (1) the Employer is unable to pay its debts as they
become due or (2) the  Employer is subject to a pending  proceeding  as a debtor
under the United States Bankruptcy Code.

2.15  MATCHING  DEFERRAL  means a deferral for the benefit of a  Participant  as
described in Section 4.2.

2.16 MATCHING DEFERRAL  LIMITATION means, with respect to Elective  Deferrals of
Compensation  for any Plan Year made by any Participant,  $75,000  multiplied by
the Matching  Deferral Rate  applicable to that  Participant for such Plan Year.
The Compensation  Committee may change the Matching Deferral  Limitation for any
Participant or all Participants at any time, provided that the Matching Deferral
Limitation  applicable to Elective  Deferrals of Compensation  for any Plan Year
made by any  Participant  may not be reduced unless the Plan  Administrator  has
given written notice of such reduction to the  Participant not less than 10 days
prior to the commencement of such Plan Year.

2.17  MATCHING  DEFERRAL  RATE  means,  with  respect to Elective  Deferrals  of
Compensation  for  any  Plan  Year  made  by  any  Participant,   33-1/3%.   The
Compensation Committee may change the Matching Deferral Rate for any Participant
or all  Participants  at any time,  provided  that the  Matching  Deferral  Rate
applicable to Elective  Deferrals of Compensation  for any Plan Year made by any
Participant may not be reduced unless the Plan  Administrator  has given written
notice of such reduction to the  Participant  not less than 10 days prior to the
commencement of such Plan Year.

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2.18 PARTICIPANT means any individual who participates in the Plan in accordance
with Article 3.

2.19 PLAN means the Snyder Oil Corporation Deferred Compensation Plan for Select
Employees as amended from time to time.

2.20 PLAN  ADMINISTRATOR  means the person,  persons or entity designated by the
Employer  to  administer  the Plan and to serve as agent for the  Employer  with
respect  to  the  Trust.  If no  such  person  or  entity  is  serving  as  Plan
Administrator at any time, the Employer shall be Plan Administrator.

2.21 PLAN YEAR  means,  in the case of the first Plan Year,  the period from the
Effective Date through December 31, 1994 and, for each Plan Year thereafter, the
12-month period ending December 31.

2.22 RETIREMENT AGE means the age of 55 or such other age as shall be determined
as the  normal  retirement  age  for  purposes  of the  Employer's  welfare  and
retirement  plans as  determined  by the  Employer's  Board of  Directors or the
Compensation  Committee thereof. No determination to increase the Retirement Age
shall be  effective  with  respect  to  amounts  credited  to the  Account  of a
Participant  with  respect  to Plan Years  commencing  prior to the time of such
determination.

2.23 TRUST  means the rabbi trust or trusts  established  by the  Employer  that
identifies the Plan as a plan with respect to which assets are to be held by the
Trustee.

2.24 TRUSTEE means the trustee or trustees under the Trust.

ARTICLE 3 -- PARTICIPATION

3.1     COMMENCEMENT OF PARTICIPATION

Any  Eligible  Employee who elects to defer part of his or her  Compensation  in
accordance  with  Section 4.1 shall become a  participant  in the Plan as of the
date such deferrals  commence in accordance with Section 4.1. Any individual who
is not already a  Participant  and whose  account is credited  with an Incentive
Contribution shall become a Participant as of the date such amount is credited.

3.2     CONTINUED PARTICIPATION

A  Participant  in the Plan shall  continue to be a  Participant  so long as any
amount remains credited to his or her Account.

3.3     CERTAIN TERMINATED PARTICIPANTS.

At the sole and continuing discretion of the Compensation Committee, an employee
of Employer who is an Eligible  Employee at the time such employee's  employment
by Employer is  terminated  and who,  as a result of such  termination,  becomes
entitled to receive severance payments shall continue as a Participant and shall
be  permitted to defer all or a portion of such  severance  payments as Elective
Deferrals  by   completing  an  Election  Form  and  filing  it  with  the  Plan
Administrator  prior to the time Employer  finally  determines that the employee
will  receive  the  severance  payments.  Section  4.2  (relating  to  "Matching
Deferrals") will not apply to Elective Deferrals under this Section.  In lieu of
an Election Form, the election by the employee may be reflected in the severance
or similar agreement providing for such severance payments. For purposes of this
Section, "severance payments" shall mean cash payments which, in accordance with
federal tax regulations,  would, but for any election hereunder,  be reported by
Employer as compensation income and which are subject to withholding for federal
income tax purposes.

ARTICLE 4 -- DEFERRALS AND INCENTIVE CONTRIBUTIONS

4.1     ELECTIVE DEFERRALS.


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Any Eligible Employee may elect to defer a percentage or dollar amount of one or
more payments of  Compensation  for the next succeeding Plan Year, on such terms
as the Plan  Administrator may permit, by completing an Election Form and filing
it with the Plan  Administrator  prior to the first day of such  succeeding Plan
Year  (or any  such  earlier  date as the  Plan  Administrator  may  prescribe),
provided  that (1) an  individual  who is an Eligible  Employee on the Effective
Date  may,  by  completing  an  Election  Form  and  filing  it  with  the  Plan
Administrator  within 30 days  following  the Effective  Date,  elect to defer a
percentage or dollar amount of one or more payments of Compensation for the 1994
Plan Year, on such terms as the Plan Administrator may permit, which are payable
to the  Participant  after the date on which  the  Eligible  Employee  files the
Election  Form and (2) an Eligible  Employee  who is a new  employee of Employer
may, by completing  an Election  Form and filing it with the Plan  Administrator
within  30  days  of the  date  such  employment  commences,  elect  to  defer a
percentage or dollar amount of one or more payments of Compensation for the Plan
Year in which such employment commences, on such terms as the Plan Administrator
may  permit,  which are payable to the  Participant  after the date on which the
Eligible Employee files the Election Form.


An election to defer a percentage or dollar amount of Compensation  for any Plan
Year shall apply only to that Plan Year, unless the Participant elects otherwise
on the Election Form.

In addition,  a Participant  may elect to defer all or part of the amount of any
elective  deferral  contributions  that  were  made on his or her  behalf to the
Employer's  401(k)  plan for the prior  Plan Year but which  were  treated as an
excess deferral,  an excess contribution or otherwise limited by the application
of the  limitations of Sections  401(k),  401(m),  415 or 402(q) of the Code, so
long as the Participant so indicates on an Election Form.

A   Participant's   Compensation   shall  be  reduced  in  accordance  with  the
Participant's election hereunder and amounts deferred hereunder shall be paid by
the Employer to the Trust as soon as  administratively  feasible and credited to
the  Participant's  Accounts  as of the date the  amounts  are  received  by the
Trustee.

4.2     MATCHING DEFERRALS

After each payroll period,  the Employer shall  contribute to the Trust Matching
Deferrals  equal to the Matching  Deferral Rate  multiplied by the amount of the
Elective Deferrals credited to the Participants'  Accounts for such period under
Section  4.1.  Each  Matching  Deferral  will be  credited  as of the date it is
received  by the  Trustee  pro rata in  accordance  with the amount of  Elective
Deferrals of each  Participant  which are taken into account in calculating  the
Matching Deferral.  The amount of Matching Contributions credited to the Account
of any Participant  with respect to Elective  Deferrals of Compensation  for any
Plan Year may not exceed the Matching  Deferral  Limitation  applicable  to that
Participant for such Plan Year.

Notwithstanding  the  foregoing  or  anything  in Section  7.1, if the amount of
"Employee  Deferral  Contributions"  (as defined in the Employer's  401(k) Plan)
made by a  Participant  during a Plan  Year is less than the  maximum  amount of
Employee  Elective  Deferrals  the  Participant  is  permitted  to  make  to the
Employer's  401(k) Plan (after taking into account the  employer's  contribution
allocated to the Participant's account and any limitations imposed by the 401(k)
Plan or the Code),  all  Matching  Deferrals,  and any income and gain  thereon,
credited to the Account of the Participant with respect to Elective Deferrals of
Compensation  for such Plan Year shall be  forfeited  and applied as provided in
Section 7.7, unless the Plan  Administrator,  in its sole discretion  determines
that the failure to contribute such maximum amount to the Employer's 401(k) Plan
is the result of an administrative error by the Employer or other reasons beyond
the Control of the Participant.

4.3     INCENTIVE CONTRIBUTIONS

In addition to other  contributions  provided  for under the Plan,  the Employer
may, in its sole discretion, select one or more Eligible Employees to receive an
Incentive Contribution to his or her account on such terms as the Employer shall
specify at the time it makes the  contribution.  For  example,  the Employer may
contribute an amount to the  Participant's  Account and condition the payment of
such  amount and  accrued  earnings  thereon  upon the  Participant's  remaining
employed by the Employer for an additional  specified  period of time. The terms
specified by the Employer shall supersede any other

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provision of this Plan as regards  Incentive  Contributions  and  earnings  with
respect thereto, provided that if the Employer does not specify (a) the terms on
which such  Incentive  Contribution  will vest, the Incentive  Contribution  and
earnings  thereon  will vest in the same manner as Matching  Deferrals  or (b) a
method of distribution,  the Incentive Contribution and earnings thereon will be
distributed  in  a  manner  consistent  with  the  election  last  made  by  the
Participant prior to the Plan Year in which the Incentive  Contribution is made.
The  Employer,  in its  discretion,  may permit the  Participant  to designate a
distribution  schedule  for a  particular  Incentive  Contribution  provided the
designation is made before the Employer finally  determines that the Participant
will receive the Incentive Contribution.

ARTICLE 5 -- ACCOUNTS

5.1     ACCOUNTS

The  Plan  Administrator   shall  establish  an  Account  for  each  Participant
reflecting  Elective Deferrals,  Matching Deferrals and Incentive  Contributions
made for the  Participant's  benefit  together with any  adjustments for income,
gain or loss and any payments  from the Account.  The Plan  Administrator  shall
establish  sub-accounts  for each Participant that has more than one election in
effect under  Section 7.1 and such other  sub-accounts  as are necessary for the
proper  administration of the Plan. As of the last business day of each calendar
quarter,  the Plan Administrator  shall provide the Participant with a statement
of his or her Account  reflecting  the income,  gains and losses  (realized  and
unrealized),  amounts of deferrals and  distributions  of such Account since the
prior statement.

5.2     INVESTMENTS

        a. Each Participant  shall designate,  in accordance with the procedures
established from time to time by the Plan Administrator, the manner in which the
amounts  allocated  to his or her Account  shall be deemed to be  invested  from
among the Funds (as such term is  hereinafter  defined) made available from time
to time for  such  purpose  by the  Plan  Administrator.  Such  Participant  may
designate  one of  such  Funds  for the  deemed  investment  of all the  amounts
allocated  to his or her  account  or such  Participant  may  split  the  deemed
investment of the amounts  allocated to his or her Account between such Funds in
such increments as the Plan administrator may prescribe.  If a Participant fails
to make a proper  designation,  then his or her  Account  shall be  deemed to be
invested in the Fund or Funds designated by the Plan  Administrator from time to
time in a uniform and nondiscriminatory  manner. For purposes of the Section 5.2
and Section 7.9 the term "Funds" shall mean the investment funds designated from
time to time by the Plan  Administrator  for the deemed  investment  of Accounts
pursuant to this Section 5.2

        b. A Participant may change his or her deemed investment designation for
future amounts to be allocated to such  Participant's  Account.  Any such change
shall  be made  in  accordance  with  the  procedures  established  by the  Plan
Administrator,  and the  frequency  of such  changes  may be limited by the Plan
Administrator.

        c. A  Participant  may elect to  convert  his or her  deemed  investment
designation with respect to the amounts already allocated to such  Participant's
Account.  Any such  conversion  shall be made in accordance  with the procedures
established by the Plan Administrator, and the frequency of such conversions may
be limited by the Plan Administrator.

        d. The preceding provisions of the Section 5.2 notwithstanding, the Plan
Administrator  may, in its sole  discretion,  permit a Participant  to designate
that all or a portion of his or her Account  (with such portion to be determined
by the Plan  Administrator)  shall be deemed to be invested in assets other than
the Funds; provided, however, that no portion of Trust assets may be invested in
securities  issued by the Employer.  If a portion of a Participant's  Account is
deemed to be invested in an asset other than the Funds (a "Deemed Asset"),  than
such  Participant  may at any time request,  in accordance  with the  procedures
prescribed by the Plan Administrator, that such deemed investment in such Deemed
Asset  be  converted  into a  deemed  investment  in one or more  of the  Funds;
provided,  however,  that if the Deemed Asset is an asset  actually  held by the
Trust at the time such conversion request is made, then such conversion shall be
permitted only at the times and to the extent that such Deemed Asset may be sold
or otherwise  disposed of by the Trust in compliance  with all applicable  laws.
The  Accounts  that are deemed to be invested in a Deemed Asset shall be reduced
by the  aggregate  amount of the costs and  expenses  incurred by the Plan,  the
Employer, the Plan

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Administrator,  the Trust,  and/or the  Trustee in  connection  with such Deemed
Asset, including, without limitation, the costs and expenses associated with the
acquisition, maintenance, and sale or exchange of such Deemed Asset.

        e. All  deemed  investments  under the Plan shall be valued at the times
and in the manner  determined by the Plan  Administrator in its sole discretion.
The Plan Administrator may at any time and for any reason, without any liability
to any Participant,  determine in its sole discretion that a particular Fund (or
asset under  paragraph  d. above)  shall no longer be  available  for the deemed
investment of an Account under the Plan. In such case, the deemed  investment in
such  Fund (or  asset)  shall be  deemed  to have  been  liquidated  on the date
selected by the Plan Administrator in its sole discretion. None of the Plan, the
Employer, the Plan Administrator, the Trust, or the Trustee shall be responsible
or  liable  for any loss  resulting  form (1) a  Participant's  exercise  of any
control or discretion  over the deemed  investment or his or her Account  and/or
(2) any actions  taken by the Plan  Administrator  pursuant to this Section 5.2.
Actions by the Plan  Administrator  pursuant to this  Section 5.2 may vary among
Participants.


ARTICLE 6 -- VESTING

6.1     GENERAL

A Participant  will be immediately  vested in, i.e., shall have a nonforfeitable
right to,  all  Elective  Deferrals,  and to all  income  and gain  attributable
thereto,  credited  to  his  or her  Account.  Subject  to  earlier  vesting  in
accordance with this Article 6, a Participant shall become vested in the portion
of his or her Account  attributable  to Matching  Deferrals made with respect to
Elective Deferrals of Compensation for a given Plan Year as follows:

(a)     33-1/3% at the end of the Plan Year with respect to which the Matching
        Deferrals are made;

(b)     33-1/3% at the end of the first Plan Year  following  the Plan Year with
        respect to which the Matching Deferrals are made; and

(c)     33-1/3% at the end of the second Plan Year  following the Plan Year with
        respect to which the Matching Deferrals are made,

or  in  such  other  manner  as  the   Compensation   Committee   shall  provide
prospectively  with  respect to any Plan Year.  Any  portion of a  Participant's
Account that have not vested on the date that a  Participant's  employment  with
Employer  terminates  shall,  except as  provided  in this  Article  6, shall be
forfeited and applied as provided in Section 7.7.

6.2     CHANGE OF CONTROL

A Participant shall become fully vested in his or her Account  immediately prior
to a Change of Control of the Employer.

6.3     DEATH, RETIREMENT OR DISABILITY

A Participant shall become fully vested in his or her Account  immediately prior
to termination of the Participant's employment by reason of Participant's death,
retirement  at or after the  attainment  of the  Retirement  Age or  Disability.
Whether a Participant's  termination of employment is by reason of Participant's
Disability or retirement  shall be determined by the Plan  Administrator  in its
sole discretion.

6.4     DISCRETIONARY VESTING

The Employer may, in its sole  discretion,  accelerate the vesting of all or any
portion of the Accounts of any Participant or all Participants.




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6.5     INSOLVENCY

A Participant shall become fully vested in his or her Account  immediately prior
to the Employer's  becoming  Insolvent,  in which case the Participant will have
the same rights as a general creditor of the Employer with respect to his or her
Account Balance.

ARTICLE 7 - PAYMENTS

7.1     ELECTION AS TO TIME AND FORM OF PAYMENT

A  Participant  shall  elect  (on the  Election  Form  used to  elect  to  defer
Compensation  under  Section 4.1) the date at which the Elective  Deferrals  and
vested Matching  Deferrals  (including any earnings  attributable  thereto) will
commence to be paid to the Participant. The Participant shall also elect thereon
for payments to be paid in either:

a:      a single lump-sum payment; or

b.      annual or monthly  installments over a period elected by the Participant
        up to 10 years,  the amount of each  installment to equal the balance of
        his or her Account  immediately prior to the installment  divided by the
        number of installments remaining to be paid.

Each such  election will be effective for the Plan Year for which it is made and
succeeding  Plan Years,  unless changed by the  Participant.  Any change will be
effective only for Elective  Deferrals and Matching Deferrals made for the first
Plan Year  beginning  after the date on which the Election Form  containing  the
change is filed with the Plan Administrator. Except as provided in Sections 7.2,
7.3, 7.4, or 7.5, payment of a Participant's Account shall be made in accordance
with the Participant's elections under this Section 7.1.

7.2     CHANGE OF CONTROL

A  Participant  may elect on the Election Form that, in the event of a Change of
Control,  the Participant's  entire Account balance (including any amount vested
pursuant to Section 6.2) will either (a) be paid to the  Participant in a single
lump sum as soon as possible  following any Change of Control of the Employer or
(b) be  paid to the  Participant  in a  single  lump  sum as  soon  as  possible
following  a Change of Control of the  Employer  unless,  prior to the Change of
Control, a majority of the members of the Board of Directors of the Employer who
are not Participants in the Plan determines that the Change of Control would not
reasonably be expected to increase  materially the economic risk of Participants
who remain in the Plan or (c) be paid in accordance with the other provisions of
the Plan without regard to any Change of Control.  Unless the Participant  shall
have elected  otherwise on the Election  Form,  as soon as possible  following a
Change of Control of the  Employer,  each  Participant  shall be paid his or her
entire Account balance  (including any amount vested pursuant to Section 6.2) in
a single lump sum.

7.3     TERMINATION OF EMPLOYMENT


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Unless the Plan  Administrator,  in its sole discretion,  determines  otherwise,
upon termination of a Participant's  employment for any reason other than death,
Disability and  retirement  after  attainment of the Retirement  Age, the vested
portion  of the  Participant's  Account  shall be paid to the  Participant  in a
single lump sum as soon as practicable  following the date of such  termination.
If the Plan  Administrator  does  determine  not to make a lump sum payment to a
Participant  under  this  Section,  the  Plan  Administrator  may,  in its  sole
discretion, determine to pay the vested portion of such Participant's Account in
a single lump sum at any time thereafter.

7.4     DISABILITY

If the  Participant's  employment  terminates by the reason of the Participant's
Disability,  the amounts credited to a Participant's Account with respect to any
Plan Year shall be paid out in  accordance  with the election made in accordance
with  Section  7.1  unless  the  Plan  Administrator,  in its  sole  discretion,
determines  to pay such  amounts in one lump sum or the  Participant  shall have
elected in such  Election Form to receive  payment of the  remaining  balance of
such amounts in one lump sum if his or her  employment  terminates  by reason of
Disability.

7.5     DEATH

If a Participant dies prior to the complete  distribution of his or her Account,
the  balance  of the  Account  shall  be  paid as  soon  as  practicable  to the
Participant's  designated  beneficiary or beneficiaries,  in the form elected by
the Participant under either of the following options:

        a.     a single lump-sum payment; or

        b.     annual  or  monthly  installments  over a period  elected  by the
               Participant  up to 10 years,  the amount of each  installment  to
               equal  the  balance  of  the  Account  immediately  prior  to the
               installment divided by the number of installments remaining to be
               paid.

Any designation of beneficiary and form of payment to such beneficiary  shall be
made by the  Participant  on an Election Form filed with the Plan  Administrator
and may be changed by the  Participant  at any time by filing  another  Election
Form containing the revised instructions.  If no beneficiary is designated or no
designated  beneficiary  survives the Participant,  payment shall be made to the
Participant's  surviving spouse or, if none, to his or her issue per stirpes, in
a single payment. If no spouse or issue survives the Participant,  payment shall
be made in a single lump sum to the Participant's estate.

7.6     UNFORESEEN EMERGENCY

If a Participant  suffers an unforeseen  emergency,  as defined herein, the Plan
Administrator,  in its sole  discretion,  may pay to the  Participant  only that
portion,  if any,  of the vested  portion of his or her  Account  which the Plan
Administrator  determines is necessary to satisfy the emergency need,  including
any amounts necessary to pay any federal, state or local income taxes reasonably
anticipated  to  result  from the  distribution.  A  Participant  requesting  an
emergency  payment  shall apply for the payment in writing in a form approved by
the Plan Administrator and shall provide such additional information as the Plan
Administrator  may  require.   For  purposes  of  this  paragraph,   "unforeseen
emergency"  means an immediate and heavy financial need resulting from either of
the following:

a.      expenses which are not covered by insurance and which the Participant
        or his or her spouse or dependent  has incurred as a result of, or is
        required to incur in order to receive, medical care; or

b.      any  circumstance  that is determined by the Plan  Administrator  in its
        sole  discretion  to constitute  an  unforeseen  emergency  which is not
        covered by  insurance  and which  cannot  reasonably  be relieved by the
        liquidation of the Participant's assets.

7.7     FORFEITURE OF NON-VESTED AMOUNTS


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To the extent  that any  amounts  credited  to a  Participant's  Account are not
vested at the time such amounts are otherwise payable under Sections 7.1 or 7.3,
such amounts shall be forfeited and shall, at the option of the Employer, either
be paid to the  Employer or used to satisfy the  Employer's  obligation  to make
contributions to the Trust under the Plan.

7.8     TAXES

All federal,  state or local taxes that the Plan  Administrator  determines  are
required to be withheld  from any payments made pursuant to this Article 7 shall
be withheld.

7.9     FORM OF DISTRIBUTIONS

        The Plan Administrator shall determine in its sole discretion the extent
        to which any  distribution  under the Plan (whether  payable in a single
        lump sum or  installments)  shall be paid in cash,  in kind,  or both in
        cash and in kind. Without limiting the scope of the Plan Administrator's
        discretion  pursuant to the preceding  sentence,  the Plan Administrator
        may in  its  sole  discretion  direct  that  all  or  any  portion  of a
        Participant's Account be distributed in kind to such Participant or such
        Participant's  designated  beneficiaries  based  upon the  Funds  and/or
        assets  in which  such  Account  is deemed to be  invested  pursuant  to
        Section  5.2  immediately  prior  to the date of such  distribution.  No
        participant  or  beneficiary  of a  Participant  shall have the right to
        demand a distribution in cash, in kind, or any combination thereof.


ARTICLE 8 - PLAN ADMINISTRATOR

8.1     PLAN ADMINISTRATION AND INTERPRETATION

The Plan  Administrator  shall oversee the  administration of the Plan. The Plan
Administrator  shall have complete control and authority to determine the rights
and benefits and all claims,  demands and actions  arising out of the provisions
of the Plan of any  Participant,  beneficiary,  deceased  Participant,  or other
person  having  or  claiming  to have any  interest  under  the  Plan.  The Plan
Administrator shall have complete discretion to interpret the Plan to decide all
matters  under  the  Plan.  Such  interpretation  and  decision  shall be final,
conclusive  and binding on all  Participants  and any person  claiming  under or
through any  Participant,  in the absence of clear and convincing  evidence that
the Plan  Administrator  acted arbitrarily and  capriciously.  Any individual(s)
serving as Plan  Administrator  who is a Participant will not vote or act on any
matter  relating solely to himself or herself.  When making a  determination  or
calculation,  the Plan  Administrator  shall be entitled to rely on  information
furnished by a Participant, a beneficiary, the Employer or the Trustee. The Plan
Administrator shall have the responsibility for complying with any reporting and
disclosure requirements or ERISA.

8.2     POWERS, DUTIES, PROCEDURES, ETC.

The Plan  Administrator  shall have such powers and duties, may adopt such rules
and  tables,  may act in  accordance  with such  procedures,  may  appoint  such
officers  or agents,  may  delegate  such powers and  duties,  may receive  such
reimbursements  and  compensation,  and shall  follow  such  claims  and  appeal
procedures with respect to the Plan as it may establish.

8.3     INFORMATION

To enable the Plan  Administrator  to perform its functions,  the Employer shall
supply  full and timely  information  to the Plan  Administrator  on all matters
relating to the  compensation of  Participants,  their  employment,  retirement,
death,  termination or employment,  and such other  pertinent  facts as the Plan
Administrator may require.

8.4     INDEMNIFICATION OF PLAN ADMINISTRATOR


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The Employer  agrees to indemnify and to defend to the fullest extent  permitted
by law any officer(s) or employee(s) who serve as Plan Administrator  (including
any such  individual  who  formerly  served as Plan  Administrator)  against all
liabilities,  damages, costs and expenses (including attorneys' fees and amounts
paid in settlement of any claims approved by the Employer) occasioned by any act
or omission to act in  connection  with the Plan,  if such act or omission is in
good faith.

ARTICLE 9 - AMENDMENT AND TERMINATION

9.1     AMENDMENTS

The Employer,  upon action of its Board of Directors or an authorized  committee
thereof,  shall  have the right to amend the Plan from time to time,  subject to
Section  9.3,  by an  instrument  in  writing  which  has been  executed  on the
Employer's behalf by its duly authorized officer.

9.2     TERMINATION OF PLAN

This Plan is strictly a voluntary  undertaking  on the part of the  Employer and
shall not be deemed to  constitute  a  contract  between  the  Employer  and any
Eligible  Employee  (or  any  other  employee)  or a  consideration  for,  or an
inducement or condition of employment  for, the  performance  of the services by
any Eligible  Employee (or other employee).  The Employer  reserves the right to
terminate  the Plan at any time,  subject to Section  9.3, by an  instrument  in
writing which has been executed on the Employer's  behalf by its duly authorized
officer.  Upon  termination,  the Employer may (a) elect to continue to maintain
the Trust to pay  benefits  hereunder  as they become due as if the Plan had not
terminated or (b) direct the Trustee to pay promptly to  Participants  (or their
beneficiaries)  the  vested  balance  of their  Accounts.  For  purposes  of the
preceding  sentence,  in the event the Employer chooses to implement clause (b),
the Account  balances of all  Participants who are in the employ of the Employer
at the time the Trustee is  directed to pay such  balances  shall  become  fully
vested and  nonforfeitable.  After Participants and their beneficiaries are paid
all Plan benefits to which they are entitled,  all remaining assets of the Trust
attributable to Participants  who terminated  employment with the Employer prior
to  termination  of the Plan who were not fully vested in their  Accounts  under
Article 6 at that time, shall be returned to the Employer.

9.3     EXISTING RIGHTS

No amendment or termination of the Plan shall adversely affect the rights of any
Participant  with  respect  to  amounts  that have been  credited  to his or her
Account prior to the date of such amendment or termination.

ARTICLE 10 - MISCELLANEOUS

10.1     NO FUNDING

The  Plan  constitutes  a mere  promise  by the  Employer  to make  payments  in
accordance with the terms of the Plan and Participants and  beneficiaries  shall
have the status of general unsecured  creditors of the Employer.  Nothing in the
Plan will be construed  to give any  employee or any other person  rights to any
specific assets of the Employer or of any other person. In all events, it is the
intent of the Employer that the Plan be treated as unfunded for tax purposes and
for purposes of Title 1 of ERISA.

10.2     NON-ASSIGNABILITY

None of the  benefits,  payments,  proceeds  or  claims  of any  Participant  or
beneficiary  shall be subject to any claim of any creditor of any Participant or
beneficiary  and, in particular,  the same shall not be subject to attachment or
garnishment  or other  legal  process by any  creditor  of such  Participant  or
beneficiary,  nor  shall  any  Participant  or  beneficiary  have  any  right to
alienate, anticipate, commute, pledge, encumber or assign any of the benefits or
payments or  proceeds  which he or she may expect to  receive,  contingently  or
otherwise, under the Plan.


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<PAGE>


10.3     LIMITATION OF PARTICIPANTS' RIGHTS

Nothing  contained  in the  Plan  shall  confer  upon  any  person a right to be
employed or to continue in the employ of the  Employer,  or interfere in any way
with the right of the Employer to terminate the  employment of an Participant in
the Plan any time, with or without cause.

10.4     PARTICIPANTS BOUND

Any  action  with  respect to the Plan  taken by the Plan  Administrator  or the
Employer or the Trustee or any action authorized by or taken at the direction of
the Plan Administrator, the Employer or the Trustee shall be conclusive upon all
Participants and beneficiaries entitled to benefits under the Plan.

10.5     RECEIPT AND RELEASE

Any payment to any  Participant or beneficiary in accordance with the provisions
of the Plan shall, to the extent thereof,  be in full satisfaction of all claims
against the Employer, the Plan Administrator and the Trustee under the Plan, and
the Plan  Administrator  amy  require  such  Participant  or  beneficiary,  as a
condition  precedent to such  payment,  to execute a receipt and release to such
effect.   If  any   Participant   or  beneficiary  is  determined  by  the  Plan
Administrator  to be  incompetent  by reason or  physical  or mental  disability
(including minority) to give a valid receipt and release, the Plan Administrator
may cause the  payment or  payments  becoming  due to such  person to be made to
another person for his or her benefit without  responsibility on the part of the
Plan  Administrator,  the Employer or the Trustee to follow the  application  of
such funds.



10.6    PLAN DOES NOT AFFECT EMPLOYMENT RIGHTS

The Plan does not  provide any  employment  rights to any  Eligible  Employee or
Participant.  The Employer expressly reserves the right to discharge an Employee
at any time,  with or without cause and with or without  prior  notice,  without
regard to the effect such discharge would have on the Employee's interest in the
Plan.

10.7     GOVERNING LAW

The Plan shall be construed,  administered,  and governed in all respects  under
and by the laws of the state of Texas. If any provision shall be held by a court
of  competent  jurisdiction  to  be  invalid  or  unenforceable,  the  remaining
provisions hereof shall continue to be fully effective.

10.8     HEADINGS AND SUBHEADINGS

Headings and subheadings in this Plan are inserted for convenience  only and are
not to be considered in the construction of the provisions hereof.


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