Document:

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                                                                   Exhibit 10.20

                                    MBIA INC.
                             2000 STOCK OPTION PLAN

                                   ARTICLE 1.
                                    PURPOSE

          The purpose of the "MBIA INC. 2000 STOCK OPTION PLAN" (the "Plan") is
to foster and promote the long-term financial success of the Company and
materially increase shareholder value by (a) motivating superior performance by
means of performance-related incentives, (b) encouraging and providing for the
acquisition of an ownership interest in the Company by the Company's and its
Subsidiaries' employees and (c) enabling the Company to attract and retain the
services of an outstanding management team upon whose judgment, interest, and
special effort the successful conduct of its operations is largely dependent.

                                   ARTICLE 2.
                                   DEFINITIONS

          (a) Definitions. Whenever used herein, the following terms shall have
the respective meanings set forth below:

          (l) "Act" means the Securities Exchange Act of 1934, as amended.

          (2) "Board" means the Board of Directors of the Company.

          (3) "Cause" means (i) the willful failure by the Participant to
     perform substantially his duties as an Employee of the Company (other than
     due to physical or mental illness) after reasonable notice to the
     Participant of such failure, (ii) the Participant's engaging in serious
     misconduct that is injurious to the Company or any Subsidiary in any way;
     including, but not limited to, by way of damage to their respective
     reputations or standings in their respective industries, (iii) the
     Participant's having been convicted of, or entered a plea of nolo
     contenders to, a crime that constitutes a felony or (iv) the breach by the
     Participant of any written covenant or agreement with the Company or any
     Subsidiary not to disclose or misuse any information pertaining to, or
     misuse any property of, the Company or any Subsidiary or not to compete or
     interfere with the Company or any Subsidiary.

          (4) "Change of Control" shall be deemed to have occurred if:

          (i) any person (within the meaning of Section 3(a)(9) of the
     Securities Exchange Act of 1934, as amended (the "Exchange Act")),
     including any group (within the meaning of Rule 13d-5(b) under the Exchange
     Act)), but excluding
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     any of the Company, any Subsidiary or any employee benefit plan sponsored
     or maintained by the Company or any Subsidiary, acquires "beneficial
     ownership" (within the meaning of Rule 13d-3 under the Exchange
     Act), directly or indirectly, of securities of the Company representing 25%
     or more of the combined Voting Power (as defined below) of the Company's
     securities; or

          (ii) within any 24-month period, the persons who were directors of the
     Company at the beginning of such period (the "Incumbent Directors") shall
     cease to constitute at least a majority of the Board or the board of
     directors of any successor to the Company; provided, however, that any
     director elected to the Board, or nominated for election, by a majority of
     the Incumbent Directors then still in office shall be deemed to be an
     Incumbent Director for purposes of this subclause (ii); or

          (iii) upon the consummation of a merger, consolidation, share
     exchange, division, sale or other disposition of all or substantially all
     of the assets of the Company which has been approved by the shareholders of
     the Company (a "Corporate Event"), and immediately following the
     consummation of which the stockholders of the Company immediately prior to
     such Corporate Event do not hold, directly or indirectly, a majority of the
     Voting Power of (x) in the case of a merger or consolidation, the surviving
     or resulting corporation, (y) in the case of a share exchange, the
     acquiring corporation or (z) in the case of a division or a sale or other
     disposition of assets, each surviving, resulting or acquiring corporation
     which, immediately following the relevant Corporate Event, holds more than
     25% of the consolidated assets of the Company immediately prior to such
     Corporate Event.

          (5) "Change of Control Price" means the highest price per share of
     Common Stock offered in conjunction with any transaction resulting in a
     Change of Control (as determined in good faith by the Committee if any part
     of the offered price is payable other than in cash) or, in the case of a
     Change of Control occurring solely by reason of a change in the composition
     of the Board, the highest Fair Market Value of the Common Stock on any of
     the 30 trading days immediately preceding the date on which a Change of
     Control occurs.

          (6) "Code" means the Internal Revenue Code of 1986, as amended.

          (7) "Committee" means the Compensation and Organization Committee of
     the Board or such other committee of the Board as the Board shall designate
     from time to time, which committee shall consist of three or more members.
     Each of the Committee members shall be a "Non-Employee Director" within
     the meaning of Rule 16b-3, as promulgated under the Act, and an "outside

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         director" within the meaning of section 162(m) of the Code and the
         Treasury Regulations promulgated thereunder.

                  (8)  "Common Stock" means the common stock of the Company, par
         value $1.00 per share.

                  (9)  "Company" means MBIA Inc., a Connecticut corporation, and
         any successor thereto.

                  (10) "Disability" has the meaning given in the Company's
         long-term disability insurance policy or program as in effect from time
         to time.

                  (11) "Employee" means any employee (including each officer) of
         the Company or any Subsidiary (as determined by the Committee in its
         sole discretion).

                  (12) "Fair Market Value" means, on any date, the closing price
         of the Common Stock as reported on the consolidated tape of the New
         York Stock Exchange (or on such other recognized quotation system on
         which the trading prices of the Common Stock are quoted at the relevant
         time) on such date. In the event that there are no Common Stock
         transactions reported on such tape (or such other system) on such date,
         Fair Market Value shall mean the closing price on the immediately
         preceding date on which Common Stock transactions were so reported.

                  (13) "Family Member" means, as to a Participant, any (i)
         child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
         sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
         brother-in-law, or sister-in-law (including adoptive relationships), of
         such Participant, (ii) trusts for the exclusive benefit of such persons
         and (iii) other entity owned solely by such persons.

                  (14) "Option" means the right to purchase Common Stock at a
         stated price for a specified period of time. For purposes of the Plan,
         an Option may be either (i) an "Incentive Stock Option" (ISO) within
         the meaning of Section 422 of the Code or (ii) an option which is not
         an Incentive Stock Option (a "Nonstatutory Stock Option" (NSO)).

                  (15) "Participant" means any Employee designated by the
         Committee to participate in the Plan.

                  (16) "Subsidiary" means any corporation or partnership in
         which the Company owns, directly or indirectly, 50% or more of the
         total combined voting power of all classes of stock of such corporation
         or of the capital interest or profits interest of such partnership or
         in which the Company has, either directly or

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indirectly, a material equity interest and which the Committee has designated
as a "Subsidiary" for purposes of this definition.

     (17) "Voting Power" when used in the definition of Change in Control shall
mean such specified number of the Voting Securities as shall enable the holders
thereof to cash such percentage of all the votes which could be cast in an
annual election of directors and "Voting Securities" shall mean all securities
of a company entitling the holders thereof to vote in an annual election of
directors.

     (18) Gender and Number. Except when otherwise indicated by the context,
words in the masculine gender used in the Plan shall include the feminine
gender, the singular shall include the plural, and the plural shall include the
singular.

                                   ARTICLE 3,
                            POWERS OF THE COMMITTEE

     (a)  Power to Grant. The Committee shall determine those Employees to whom
Options shall be granted and the terms and conditions of any and all such
Options. The Committee may establish different terms and conditions for
different Participants and for the same Participant for each Option such
Participant may receive, whether or not granted at different times.

     (b)  Administration.

     (1)  Rules, Interpretations and Determinations. The Plan shall be
administered by the Committee. The Committee shall have full authority to
interpret and administer the Plan, to establish, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions deemed necessary or
advisable to protect the interests of the Company, to construe the respective
option agreements and to make all other determinations it determines necessary
or advisable for the administration and interpretation of the Plan in order to
carry out its provisions and purposes. Determinations, interpretations, or
other actions made or taken by the Committee shall be final, binding, and
conclusive for all purposes and upon all persons.

     (2)  Agents and Expenses. The Committee may appoint agents (who may be
officers or employees of the Company) to assist in the administration of the
Plan and may grant authority to such persons to execute agreements or other
documents on its behalf. The Committee may employ such legal counsel,
consultants and agents as it may deem desirable for the administration of the
Plan and may rely upon any opinion received from any such counsel or consultant
and any computation received from any such consultant or agent. All expenses

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         incurred in the administration of the Plan, including, without
         limitation, for the engagement of any counsel, consultant or agent,
         shall be paid by the Company.

                  (3) Delegation of Authority. The Committee may delegate to the
         Company's Chief Executive Officer the power and authority to make
         awards under the Plan with respect to individuals who are at or below
         the position of Senior Managing Director (or analogous title), pursuant
         to such conditions and limitations as the Committee may establish;
         provided that only the Committee or the Board may select, and grant
         Options to, Participants who are subject to Section 16 of the Act.

                  (c) Certain Rules Relating to Grants.

                  (1) Maximum Individual Grants. During any 12 month period, no
         individual Participant may be granted Options to acquire more than
         500,000 shares of Common Stock. It is understood that this provision is
         subject to the adjustment provided for in Section 4(c).

                  (2) Repricing or Substitution of Options. The Committee shall
         not have the right to reprice outstanding Options or to grant new
         Options under the Plan in substitution for or upon the cancellation of
         Options previously granted. Additionally, the Committee shall not have
         the right to grant reload options under the Plan.

                                   ARTICLE 4.
                          COMMON STOCK SUBJECT TO PLAN

         (a) Number. Subject to the provisions of Section 4(c), the number of
shares of Common Stock issuable under the Plan shall not exceed 5,000,000
shares. Any shares which, as of the effective date of the Plan, remain available
for awards under the Company's 1987 Stock Option Plan shall, upon approval of
the Plan by the Company's shareholders, be canceled and no longer available for
awards. The shares to be delivered under the Plan may consist, in whole or in
part, of treasury Common Stock or authorized but unissued Common Stock, not
reserved for any other purpose.

         (b) Canceled, Terminated, or Forfeited Options. Any shares of Common
Stock subject to an Option which for any reason is canceled, terminated or
otherwise settled without the issuance of any Common Stock (and, except with
respect to ISO's, including, but not limited to, shares tendered to exercise
outstanding Options or shares tendered or withheld for taxes) shall again be
available for Options under the Plan.

         (c) Adjustment in Capitalization. In the event of any Common Stock
dividend or Common Stock split, recapitalization (including, but not limited, to
the

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payment of an extraordinary dividend), merger, consolidation, combination,
spin-off, distribution of assets to stockholders (other than ordinary cash
dividends), exchange of shares, or other similar corporate change, the aggregate
number of shares of Common Stock available for Options under Sections 3(c)(1)
and 4(a) or subject to outstanding Options and the respective exercise prices
applicable to outstanding Options may be appropriately adjusted by the
Committee, in its discretion, and the Committee's determination shall be
conclusive.

                                   ARTICLE 5.
                                  STOCK OPTIONS

         (a) Grant of Options. Subject to the provisions of Section 4(a),
Options may be granted to Participants at such time or times as shall be
determined by the Committee. Options granted under the Plan may be of two types:
(i) Incentive Stock Options and (ii) Nonstatutory Stock Options. Except as
otherwise provided herein, the Committee shall have complete discretion in
determining the number of Options, if any, to be granted to a Participant,
except that Incentive Stock Options may only be granted to Employees who are
common law employees of the Company or one of its majority owned subsidiaries
(within the meaning of Section 424 of the Code). Each Option shall be evidenced
by an Option agreement that shall specify the type of Option granted, the
exercise price, the duration of the Option, the number of shares of Common Stock
to which the Option pertains, and such other terms and conditions as the
Committee shall determine which are not inconsistent with the provisions of the
Plan.

         (b) Option Price. Nonstatutory Stock Options and Incentive Stock
Options granted pursuant to the Plan shall have an exercise price no less than
the Fair Market Value of a share of Common Stock on the date on which the Option
is granted.

         (c) Exercise of Options. Unless the Committee shall, at grant, impose
an alternative exercise schedule with respect to Options granted hereunder, 40%
of each Nonstatutory Stock Option or Incentive Stock Option granted pursuant to
the Plan shall become exercisable on the second anniversary of the date such
Option is granted and the remaining 60% of each Option shall become exercisable
in equal 20% installments on each of the third, fourth and fifth anniversaries
of the option grant date; provided that the Committee may at any time accelerate
the exercisability of all or any portion of any Option at its discretion.
Subject to the provisions of this Article 5, once any portion of any Option has
become exercisable it shall remain exercisable for its full term. The Committee
shall determine the term of each Nonstatutory Stock Option or Incentive Stock
Option granted, but in no event shall any such Option be exercisable for more
than 10 years after the date on which it is granted.

         (d) Payment. The Committee shall establish procedures governing the
exercise of Options. No shares shall be delivered pursuant to any exercise of an
Option

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unless arrangements satisfactory to the Committee have been made to assure full
payment of the option price therefor. Without limiting the generality of the
foregoing, payment of the option price may be made (i) in cash or its
equivalent, (ii) by exchanging shares of Common Stock owned by the optionee
(which are not the subject of any pledge or other security interest), (iii)
through an arrangement with a broker approved by the Company whereby payment of
the exercise price is accomplished with the proceeds of the sale of Common Stock
or (iv) by any combination of the foregoing; provided that the combined value of
all cash and cash equivalents paid and the Fair Market Value of any such Common
Stock so tendered to the Company, valued as of the date of such tender, is at
least equal to such option price.

         (e) Incentive Stock Options. Notwithstanding anything in the Plan to
the contrary, no Option that is intended to be an Incentive Stock Option may be
granted after the tenth anniversary of the effective date of the Plan and no
term of this Plan relating to Incentive Stock Options shall be interpreted,
amended or altered, nor shall any discretion or authority granted under the Plan
be so exercised, so as to disqualify the Plan under Section 422 of the Code, or,
without the consent of any Participant affected thereby, to disqualify any
Incentive Stock Option under such Section 422.

         (f) Termination of Employment

         (1) Due to Death or Disability. In the event a Participant's employment
terminates by reason of death or Disability, any Options granted to such
Participant shall become immediately exercisable in full and may be exercised by
the Participant's designated beneficiary, and if none is named, in accordance
with Section 8(b), at any time prior to the earlier of (i) the first anniversary
of the Participant's death or termination of employment due to Disability or
(ii) the expiration of the term of the Options.

         (2) Termination of Employment For Cause. In the event a Participant's
employment is terminated by the Company or any Subsidiary for Cause, any Options
granted to such Participant that are then not yet exercised shall be forfeited.

         (3) Termination of Employment for Any Other Reason. Unless otherwise
determined by the Committee at or following the time of grant, in the event the
employment of the Participant shall terminate for any reason other than one
described in Section 5(f)(1) or (2), any Options granted to such Participant
which are exercisable at the date of the Participant's termination of employment
may be exercised at any time prior to the expiration of the term of the Options
or the ninetieth day following the Participant's termination of employment,
whichever period is shorter, and any Options that are not exercisable at the
time of termination of employment shall be forfeited.

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         (g) Restrictive Covenants and Other Conditions. Without limiting the
generality of the foregoing, the Committee may condition the grant of any Option
under the Plan upon the Employee to whom such Option would be granted agreeing
in writing to certain conditions in addition to the provisions regarding
exercisability of the Option (such as restrictions on the ability to transfer
the underlying shares of Common Stock) or covenants in favor of the Company
and/or one or more Subsidiaries (including, without limitation, covenants not to
compete, not to solicit employees and customers and not to disclose confidential
information, that may have effect following the termination of the Employee's
employment with the Company and its Subsidiaries and after the Option has been
exercised, including, without limitation, the requirement that the Employee
disgorge any profit, gain or other benefit received in respect of the exercise
of the Option prior to any breach of any such covenant by the Employee).

                                   ARTICLE 6.
                                CHANGE OF CONTROL

         (a) Accelerated Vesting and Payment. Subject to the provisions of
Section 6(b), in the event of a Change of Control each Option shall be fully
exercisable regardless of the exercise schedule otherwise applicable to such
Option and, in connection with such a Change of Control, the Committee may, in
its discretion, provide that each Option shall, upon the occurrence of such
Change of Control, be canceled in exchange for a payment in an amount equal to
the excess, if any, of the Change of Control Price over the exercise price for
such Option.

         (b) Alternative Awards. Notwithstanding Section 6(a), no cancellation,
acceleration of exercisability, vesting, cash settlement or other payment shall
occur with respect to any Option if the Committee reasonably determines in good
faith prior to the occurrence of a Change of Control that such Option shall be
honored or assumed, or new rights substituted therefore (such honored, assumed
or substituted award hereinafter called an "Alternative Award"), by a
Participant's employer (or the parent or an affiliate of such employer)
immediately following the Change of Control; provided that any such Alternative
Award must:

         1)       be based on stock which is traded on an established securities
                  market, or that the Committee reasonably believes will be so
                  traded within 60 days after the Change in Control;

         2)       provide such Participant with rights and entitlements
                  substantially equivalent to or better than the rights, terms
                  and conditions applicable under such Option, including, but
                  not limited to, an identical or better exercise or vesting
                  schedule and identical or better timing and methods of
                  payment;

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         3)       have substantially equivalent economic value to such Option
                  (determined at the tine of the Change in Control); and

         4)       have terms and conditions which provide that in the event that
                  the Participant's employment is involuntarily terminated or
                  constructively terminated, any conditions on a Participant's
                  rights under, or any restrictions on transfer or
                  exercisability applicable to, each such Alternative Award
                  shall be waived or shall lapse, as the case may be.

For this purpose, a constructive termination shall mean a termination of
employment by a Participant following a material reduction in the Participant's
base salary or a Participant's incentive compensation opportunity or a material
reduction in the Participant's responsibilities, in either case without the
Participant's written consent.

                                   ARTICLE 7.
                AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN

         The Board at any time may terminate the Plan, and from time to time may
amend or modify the Plan; provided, however, that any amendment which would (i)
increase the number of shares available for issuance under the Plan, (ii) lower
the minimum exercise price at which an Option may be granted or (iii) extend the
maximum term for Options granted hereunder shall be subject to the approval of
the Company's shareholders. No amendment, modification, or termination of the
Plan shall in any manner adversely affect any Option theretofore granted under
the Plan, without the consent of the Participant.

                                   ARTICLE 8.
                            MISCELLANEOUS PROVISIONS

         (a) Transferability of Options. No Options granted under the Plan may
be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution; provided that the
Committee may, in the Option agreement or otherwise, permit transfers of
Nonstatutory Stock Options to Family Members (including, without limitation,
transfers effected by a domestic relations order).

         (b) Beneficiary Designation. Each Participant under the Plan may from
time to time name any beneficiary or beneficiaries (who may be named
contingently or successively) to whom any benefit under the Plan is to be paid
or by whom any right under the Plan is to be exercised in case of his death.
Each designation will revoke all prior designations by the same Participant,
shall be in a form prescribed by the Committee, and will be effective only when
received by the Committee in writing during

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his lifetime. In the absence of any such effective designation, benefits
remaining unpaid at the Participant's death shall be paid to or exercised by
the Participant's surviving spouse, if any, or otherwise to or by his estate.

     (c)  Deferral of Payment.  The Committee may, in the Option agreement or
otherwise, permit a Participant to elect, upon such terms and conditions as the
Committee may establish, to defer receipt of shares of Common Stock that would
otherwise be issued upon exercise of a Nonstatutory Stock Option.

     (d)  No Guarantee of Employment or Participation.  Nothing in the Plan
shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary or any other affiliate of the Company. No Employee shall have a
right to be selected as a Participant, or, having been so selected, to receive
any future Options.

     (e)  Tax Withholding.  The Company shall have the power to withhold, or
require a Participant to remit to the Company, an amount sufficient to satisfy
Federal, state, and local withholding tax requirements on any Option under the
Plan, and the Company may defer issuance of Common Stock until such
requirements are satisfied. The Committee may, in its discretion, permit a
Participant to elect, subject to such conditions as the Committee shall impose,
(i) to have shares of Common Stock otherwise issuable under the Plan withheld
by the Company or (ii) to deliver to the Company previously acquired shares of
Common Stock having a Fair Market Value sufficient to satisfy such withholding
tax obligation associated with the transaction.

     (f)  Indemnification.  Each person who is or shall have been a member of
the Committee or of the Board shall be indemnified and held harmless by the
Company against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him in connection with or resulting from
any claim, action, suit, or proceeding to which he may be made a party or in
which he may be involved by reason of any action taken or failure to act under
the Plan (in the absence of bad faith) and against and from any and all amounts
paid by him in settlement thereof, with the Company's approval, or paid by him
in satisfaction of any judgment in any such action, suit, or proceeding against
him; provided that he or she shall give the Company an opportunity, at its own
expense, to handle and defend the same before he undertakes to handle and
defend it on his own behalf. The foregoing right of indemnification shall not
be exclusive and shall be independent of any other rights of indemnification to
which such person may be entitled under the Company's Certificate of
Incorporation or By-Laws, by contract, as a matter of law, or otherwise.

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         (g) No Limitation on Compensation. Nothing in the Plan shall be
construed to limit the right of the Company to establish other plans if and to
the extent permitted by applicable law.

         (h) Requirements of Law. The granting of Options and the issuance of
shares of Common Stock shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.

         (i) Term of Plan. The Plan shall be effective on May 11, 2000, the date
of its approval by the Company's shareholders. The Plan shall expire on the
tenth anniversary of such date, provided that any awards granted prior to the
expiration of this Plan may extend beyond that date.

         (j) Governing Law. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of
Connecticut, without regard to principles of conflict of laws.

         (k) No Impact On Benefits. Except as may otherwise be specifically
stated under any employee benefit plan, policy or program, Options shall not be
treated as compensation for purposes of calculating an Employee's right under
any such plan, policy or program.

         (1) No Constraint on Corporate Action. Nothing in this Plan shall be
construed (i) to limit, impair or otherwise affect the Company's right or power
to make adjustments, reclassifications, reorganizations or changes of its
capital or business structure, or to merge or consolidate, or dissolve,
liquidate, sell, or transfer all or any part of its business or assets or (ii)
except as provided in Article 7, to limit the right or power of the Company or
any of its Subsidiaries to take any action which such entity deems to be
necessary or appropriate.

                                       11<PAGE>   1
                                                                   Exhibit 10.28

                      CapMAC EMPLOYEE STOCK OWNERSHIP PLAN
                 AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1999
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                                TABLE OF CONTENTS

                                                                            Page
ARTICLE I      GENERAL ....................................................   1

ARTICLE II     DEFINITIONS ................................................   2

ARTICLE III    PARTICIPATION IN THE PLAN ..................................  11

ARTICLE IV     COMPANY CONTRIBUTIONS ......................................  13

ARTICLE V      TRUST FUND .................................................  14

ARTICLE VI     ALLOCATION OF CONTRIBUTIONS TO THE TRUST FUND...............  23

ARTICLE VII    VESTING ....................................................  31

ARTICLE VIII   RETIREMENT BENEFITS.........................................  35

ARTICLE IX     DEATH BENEFITS .............................................  41

ARTICLE X      DESIGNATION OF BENEFICIARIES................................  42

ARTICLE XI     MAXIMUM AMOUNT OF ALLOCATION................................  44

ARTICLE XII    RIGHTS AND OPTIONS CONCERNING DISTRIBUTED SHARES............  47

ARTICLE XIII   ADMINISTRATION OF THE PLAN .................................  51

ARTICLE XIV    WITHDRAWAL OF PARTICIPATING COMPANY ........................  56

ARTICLE XV     AMENDMENT OR TERMINATION OF THE PLAN AND TRUST .............  55

ARTICLE XVI    GENERAL LIMITATIONS AND PROVISIONS .........................  60

ARTICLE XVII   TOP HEAVY PROVISIONS .......................................  66
<PAGE>   3
                                                                               1

                                    ARTICLE I
                                     GENERAL

1.1   History and Nature of Plan. The purpose of the CapMAC Employee Stock
Ownership Plan (the Plan), which was adopted concurrently with the purchase of
CapMac Holdings, Inc. from Citicorp on June 25, 1992 by a group of investors,
was to provide employees of CapMAC and other Participating Companies with the
opportunity to obtain ownership interests in the employer.

         The stock of CapMac, which was first offered to the public in December
of 1995, was exchanged for MBIA shares on February 17, 1998 in connection with
the acquisition of CapMac by MBIA. The ESOP, as well as all other CapMac
shareholders, received .4675 MBIA shares for each share of CapMac.

         MBIA, as a successor Employer, has elected, to continue to maintain the
Plan and to extend benefits under the Plan to all MBIA employees (not only
former CapMac employees) effective January 1, 1999. Further, effective July 1,
1999, the Plan shall be merged into the MBIA Inc. Employees Profit Sharing and
Salary Deferral Plan (40l (k) Plan).

         The Plan and Trust are intended to qualify as a stock bonus plan and
trust which are qualified and exempt from taxation under Sections 401(a) and
501(a) of the Code (and the Plan is intended to qualify as, and shall be
construed so as to be, an employee stock ownership plan, as defined by Section
4975(e)(7) of the Code and Section 407(d)(6) of the Act), designed to invest
primarily in shares of stock of the Employer which meet the requirements for
"qualifying employer securities" under Section 4975(e)(8) of the Code and
Section 407(d)(5) of the Act, and to incur debt in order to purchase such
shares, and all provisions of the Plan and Trust shall be construed accordingly.

         All Trust Fund assets, Participating Company contributions, income and
other additions to the Trust Fund shall be administered, distributed, forfeited
and otherwise governed by the provisions of the Plan.
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1.2   Effective Date. The original effective date of the Plan is June 25, 1992.
The Plan is amended and restated effective January 1, 1999, except as may be
noted otherwise.

1.3   Defined Terms. All capitalized terms used in the Plan shall have the
meaning set forth in Article II, unless the context clearly indicates otherwise
or such terms are not defined in Article II.
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                                   ARTICLE 11
                                   DEFINITIONS

2.1   "Account" means the account (including any subaccounts established from
time to time under each such account including ESOP matching accounts
established after December 31, 1998) maintained to record the interest of a
Participant in the Trust Fund.

2.2   "Act" means the Employee Retirement Income Security Act of 1974, as now
in effect or as hereafter amended. All citations to sections of the Act are to
such sections as they may from time to time be amended or renumbered.

2.3   "Affiliate" means any entity aggregated with the Company within the
meaning of Sections 414(b), (c) or (m) of the Code, or under Regulations
prescribed under Section 414(o) of the Code, except that, for the purposes of
applying the provisions of Article XI and Sections 17.3(a) and 17.4 herein with
respect to the limitations or contributions, Section 415(h) of the Code shall
apply.

2.4   "Anniversary Date" means the last day of each Plan Year, or any other date
during the Plan Year specified on a nondiscriminatory basis by the Committee in
order to avoid prejudice either to continuing Participants or inactive
Participants or for such other reasons as the Committee shall determine to be
appropriate.

2.5   "Beneficiary" means the beneficiary or beneficiaries designated by a
Participant pursuant to Article X to receive the amount, if any, payable under
the Plan upon the death of such Participant, or, where there has been no such
designation or an invalid designation, the individual or entity, or the
individuals or entities, who will receive such amount.

2.6   "Board of Directors" means the Board of Directors of the Company.

2.7   "Break in Service" means a Plan Year during which an individual has not
completed more than 500 Hours of Service, as determined by the Company (or its
delegate, which may be the Committee) in accordance with the Regulations.
Effective with respect to absences commencing on or after January 1, 1985,
solely for purposes of determining
<PAGE>   6
                                                                               3

whether a Break in Service has occurred for vesting and eligibility purposes, an
individual shall be credited with the Hours of Service which such individual
would have completed but for a maternity or paternity absence, as determined by
the Company (or its delegate, which may be the Committee) in accordance with and
to the extent required by this Section and the Code and Regulations; provided,
however, that the total Hours of Service so credited for a maternity or
paternity absence shall not exceed 501 hours and that the individual shall
timely provide the Company (or its delegate, which may be the Committee) with
such information as it shall require. Hours of Service credited for a maternity
or paternity absence shall be credited entirely (a) in the Plan Year in which
the absence began if such Hours of Service are necessary to prevent a Break in
Service in such Plan Year, or (b) in the following Plan Year. For purposes of
this Section, maternity or paternity absence shall mean an absence from work by
reason of the individual's pregnancy, the birth of the individual's child or the
placement of a child with the individual in connection with adoption of the
child by such individual, or for the purposes of caring for a child for the
period immediately following such birth or placement.

2.8   "Code" means the internal Revenue Code of 1986, as now in effect or as
hereafter amended. All citations to sections of the Code are to such sections as
they may from time to time be amended or renumbered.

2.9   "Committee" means the Committee provided for in Article XIII, which shall
be the administrator of the Plan and the named fiduciary for purposes of the
Act with respect to Plan administration.

2.10  "Company" means MBIA Inc. Any corporation which shall, by merger,
consolidation, purchase or otherwise, succeed to substantially all the business
of the Company shall, upon such succession and without any appointment or other
action of the Trustee, the Committee or the Company, be and become the Company.

2.11  "Compensation" means, unless otherwise indicated,

      (a) an individual's wages from Participating Companies under Section
3401(a) of the Code and all other payments of compensation made in the course
of such Participating
<PAGE>   7
                                                                               4

Companies' trades or business for which a Participating Company must furnish a
written statement under Sections 6041(d) and 6051(a)(3) of the Code (i.e., a
Form W-2 or successor thereto), other than amounts paid or reimbursed for moving
expenses incurred by the individual to the extent that it is then reasonable to
believe that such amounts are deductible under Section 217 of the Code, but
determined without regard to any rules that limit the remuneration included in
wages based on the nature or location of the employment or the services
performed, and

         (b) any amounts not otherwise includable under the foregoing provisions
of this sentence which are contributed by Participating Companies pursuant to a
salary reduction agreement to a "qualified cash or deferred arrangement" within
the meaning of Section 401(k)(2) of the Code or a "cafeteria plan" within the
meaning of Section 125 of the Code; provided, however, that Compensation in
excess of $160,000 (as adjusted upwards, when applicable, to the extent
permitted by the Code and Regulations) shall not be taken into account to the
extent and in the manner required by Section 401(a)(17) of the Code.

         (c) Solely for purposes of allocating Shares; Forfeitures or
Participating Company contributions to Accounts under the Plan (and subject to
the limitations of the Internal Revenue Code) (i) only Compensation paid to an
individual while a Participant and an Employee of a Participating Company shall
be taken into account, (ii) Compensation that is accrued for a Plan Year shall
be taken into account provided that such amounts accrued are paid to the
Participant within 2-1/2 months after the close of the Plan Year and such
amounts are reasonable compensation, (iii) Compensation amounts which are
deferred under a supplemental deferred compensation plan maintained by MBIA or a
Participating Company shall be taken into account, (iv) Compensation amounts
which represent payment of amounts deferred in a prior year under a supplemental
deferred compensation plan maintained by MBIA or a Participating Company shall
not be taken into account, and (v) Compensation shall not include any foreign
service premium paid to a Participant temporarily assigned overseas.
<PAGE>   8
                                                                               5

         (d) In addition to other applicable limitations set forth in the Plan,
and notwithstanding any other provision of the Plan to the contrary, for Plan
Years beginning on or after January 1, 1994, the annual Compensation of each
Employee taken into account under the Plan shall not exceed the OBRA '93 annual
Compensation limit. The OBRA '93 annual compensation limit is $150,000, as
adjusted by the Commissioner for increases in the cost-of-living in accordance
with section 401(a)(17)(B) of the Internal Revenue Code. The cost-of-living
adjustment in effect for a calendar year applies to any period, not exceeding 12
months, the OBRA '93 annual Compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the determination period, and
the denominator of which is 12.

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

         (f) If Compensation for any prior determination period is taken into
account in determining an Employee's benefits accruing in the current Plan Year,
the Compensation for that prior determination period is subject to the OBRA '93
annual Compensation limit in effect for that prior determination period. For
this purpose, for determination periods beginning before the first day of the
first Plan Year beginning on or after January 1, 1994; the OBRA '93 annual
Compensation limit is $ 150,000.

2.12  "Disability" means a physical or mental condition under which the Employee
qualifies for disability benefits under the long-term disability plan of the
Participating Company which employs the Employee.

2.13  "Employee" means a person who is an employee of a Participating Company,
excluding any employee (a) who is included in a unit of employee covered by a
negotiated collective bargaining agreement (where there exists evidence that
retirement in a unit of employees covered by a negotiated collective benefits
were the subject of good-faith bargaining), unless such agreement provides for
participation in the Plan; (b) who is a leased employee (for purposes of Section
414(n) of the Code); or (c) who is a nonresident alien.
<PAGE>   9
                                                                               6

2.14  "Entry Date" means each January 1 and July 1.

2.15  "Exempt Loan" means any loan to the Plan or Trust not prohibited by
Section 4975(c) of the Code and Section 406 of the Act because the loan meets
the requirements set forth in Section 4975(d)(3) of the Code and Section
408(b)(3) of the Act, and the Regulations promulgated thereunder, the proceeds
of which loan are used to finance the acquisition of Shares or refinance or
repay such a loan.

2.16  "Forfeiture" means the portion of a Participant's Account which is
forfeited under Article VII.

2.17  "Hour of Service" means all of the following:

         (a) Each hour for which an employee is paid or entitled to payment, for
the performance of duties for the Company or an Affiliate. These hours shall be
credited to such individual for the computation period in which the duties are
performed.

         (b) Each hour for which an employee is paid, or entitled to payment,
by the Company or an Affiliate on account of a period of time during which no
duties are performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence. No more than
501 hours of service shall be credited under this paragraph for any single
continuous period during which such individual performs no duties (whether or
not such period occurs in a single computation period).

         (c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Company or an Affiliate. The same
hours of service shall not be credited both under Subsection (a) or Subsection
(b), as the case may be, and under this Subsection (c) These hours will be
credited to the Employee for the computation period or periods to which the
award or agreement pertains rather than the computation period in which the
award, agreement or payment is made. No more than 501 hours are required to be
credited for payments of back pay, to the extent that such back pay is agreed to
or awarded for a period of time during which an employee did not or would not
have performed duties.
<PAGE>   10
                                                                               7

         In the case of a family and medical leave absence, a Participant shall
be credited to the extent required by the Family and Medical Leave Act of 1993,
for purposes of eligibility for participation and vesting, with the total number
of Hours of Service he or she would have worked had he or she not been on a
family and medical leave of absence;

         In the case of an absence of employment because of qualified military
service, a Participant shall be credited, to the extent required by the
Uniformed Services Employment and Reemployment Rights Act of 1994 and Section
414(u) of the Code, for purposes of eligibility for participation and vesting,
the total number of Hours of Service he or she would have worked had he or she
not been on a leave of absence due to military service.

         An individual with respect to whom Hours of Service are not recorded
shall be credited hereunder with 45 Hours of Service for each week in which the
individual would otherwise be entitled to be credited with one Hour of Service.
A Participant shall be deemed to have completed 45 Hours of Service for each
week of leave of absence approved for military service. Hours of Service shall
be determined in accordance with Section 2530.200b-2(b) and (c) of the
Department of Labor Regulations, which is hereby incorporated herein by
reference.

2.18  "IRS" means the Internal Revenue Service.

2.19  "Limitation Year" means the one-year period ending on the last day of the
Plan Year.

2.20  "Normal Retirement Date" means the date described in Section 8.1.

2.21  "Participant" means any individual who begins to participate in the Plan
as provided in Article III, and whose participation has not been terminated as
provided in such Article.

2.22  "Participating Company" means the Company and, subject to Section 16.16,
any Affiliate, whose board of directors or equivalent governing body has adopted
the Plan and Trust Agreement by appropriate action with the written consent of
the Board of Directors.

2.23  "Plan" means the CapMAC Employee Stock Ownership Plan, as now in effect
or as hereafter amended.
<PAGE>   11
                                                                               8

2.24 "Plan Administrator" means the Committee.

2.25 "Plan Year" means the period beginning on January 1 and ending on December
31, except that the first Plan Year of the Plan shall begin on the Effective
Date.

2.26 "Prohibited Individual" means a Participant described in Section 409(n)(1)
of the Code.

2.27 "Regulations" means the applicable regulations issued under the Code, the
Act or other applicable law, by the IRS, the Department of Labor or any other
governmental authority, and any temporary or other appropriate and effective
regulations or rules promulgated by such authorities pending the issuance of
such regulations.

2.28 "Retirement Date" means a Participant's Normal Retirement Date, Deferred
Retirement Date or Disability Termination Date, as provided in Article VIII.

2.29 "Shares" means the common stock issued by the Company. To the extent the
Board of Directors so resolves, or if the Board of Directors has not so
resolved and stock described in the first sentence does not meet the
requirements under both Section 4975(e)(8) of the Code and Section 407(d)(5) of
the Act for "qualifying employee securities," then "Shares" shall mean any
stock satisfying such requirements. If such stock is of an entity other than the
Company, such other entity may (and, if necessary, shall) be deemed to be the
Company for purposes of such Plan and Trust Agreement provisions relating to
Shares as may be appropriate.

2.30 "Surviving Spouse" means the survivor of a deceased former Participant to
whom such deceased former Participant had been legally married (as determined
by the Committee) immediately before the Participant's death.

2.31 "Suspense Subfund" means the subfund established under Section 6.2 as part
of the Trust Fund to hold Shares purchased with the proceeds of an Exempt Loan
pending the allocation of such Shares to individual Accounts.

2.32 "Termination of Service" means a termination of employment with the Company
or an Affiliate as determined by the Committee in accordance with reasonable
standards and policies adopted by the Committee; provided, however, that the
transfer of an Employee
<PAGE>   12
                                                                               9

from employment by one Participating Company or an Affiliate to employment by
another Participating Company or Affiliate shall not constitute a Termination
of Service. Notwithstanding the foregoing, an Employee who is absent on account
of service in the armed forces of the United States of America shall not incur a
Termination of Service in contravention of federal law.

2.33 "Trust" means the CapMAC Employee Stock Ownership Plan Trust, created by
the Trust Agreement entered into between the Company and the Trustee.

2.34 "Trust Agreement" means the CapMAC Employee Stock Ownership Plan Trust
Agreement by and between the Company and the Trustee, as now in effect or as
hereafter amended.

2.35 "Trustee" means HSBC, (formerly Marine Midland Bank). or such other entity
serving as a trustee under the Trust Agreement.

2.36 "Trust Fund" means all Shares, cash and other securities and all other
assets deposited with or acquired by the Trustee in its capacity as such
hereunder, together with accumulated income, subject to all liabilities incurred
by the Trustee in its capacity as such and less all disbursements made in
respect thereof.

2.37 "Valuation Date" means December 31, or any other date during the Plan Year
specified by the Committee, upon or as of which the assets and liabilities of
the Trust Fund are valued, as prescribed by Section 5.5.

2.38 "Vested Interest" means the portion of a Participant's Account which has
become nonforfeitable pursuant to Sections 7.1 and 17.3.

2.39 "Year of Service" means, with respect to an individual, each Plan Year
during which the individual has completed at least 1,000 Hours of Service;
provided, however, that for purposes of determining whether a Participant is
vested under the Plan under Section 7.1, only Hours of Service after an
individual has attained age 18 shall be counted. For purposes of determining
whether an Employee may be enrolled in the membership of the Plan as provided in
Article III, the initial twelve consecutive month period shall begin on the
first day on which such Employee is credited with an Hour of Service (rather
than the first day of
<PAGE>   13
                                                                              10

the Plan Year in which such Employee is first credited with an Hour of Service).
If an Employee does not complete 1,000 Hours of Service during this initial
twelve consecutive month period, the first Plan Year beginning after the first
day on which such Employee is credited with an Hour of Service shall be used to
determine whether an Employee may be enrolled in the membership of the Plan as
provided in Article III.

         Years of Service before a Break in Service shall be taken into account
if a Year of Service shall be taken into account if a Year of Service has been
completed after such Break in Service. Years of Service before five consecutive
Breaks in Service of a non-vested Participant shall not be taken into account.
Years of Service shall not include Hours of Service with the Company or an
Affiliate before the Effective Date; provided, however, that with respect to
Employees who are employed by a Participating Company on the Effective Date
(and only with respect to such Employees), Years of Service for purposes of
eligibility to participate in the Plan and vesting in Accounts under the Plan,
shall be determined by taking into account, without limitation, hours of
service for which credit was given under the Citicorp Retirement Plan before the
Effective Date.
<PAGE>   14
                                                                              11

                                   ARTICLE III
                            PARTICIPATION IN THE PLAN

3.1   Participation. Each individual who was a Participant in the Plan on
February 16, 1998 shall continue to be a Participant in the Plan as of such
date. Each other individual who is an Employee of MBIA shall participate in the
Plan on the Entry Date coincident with or immediately following the Employee's
completion of 6 Months of Service, but in no event prior to July 1, 1999 and in
no event later than the Entry Date coincident with or immediately following the
Employee's completion of one Year of Service.

         For purposes of this Section, an Employee shall be deemed to have
completed six Months of Service if he is in the employ of the Employer at any
time six months after the first day upon which he is credited with an Hour of
Service for the performance of duty.

3.2   Participation Upon Reemployment or Transfer.

         (a) A Participant (whether or not vested) who incurs a Termination of
Service and becomes an Employee again before incurring a Break in Service shall
be eligible to participate in the Plan on the date he or she again performs an
Hour of Service as an Employee.

         (b) A vested Participant who incurs a Termination of Service shall
always be eligible to participate in the Plan on the date he or she again
performs an Hour of Service.

         (c) A non-vested Participant who incurs a Termination of Service, but
becomes an Employee again before incurring five consecutive Breaks in Service,
shall be eligible to participate in the Plan on the date he or she again
performs an Hour of Service as an Employee.

         (d) A non-vested Participant who incurs a Termination of Service and
also incurs five consecutive Breaks in Service before again becoming an Employee
shall be treated as a new employee for all purposes of the Plan. A reemployed
Employee with no Years of Service for purposes of Article III shall also be
treated as a new employee.
<PAGE>   15
                                                                              12

3.3   Participation and Adjustments. The Committee shall take any necessary or
appropriate action to ensure that each Employee eligible to become a Participant
under Article III becomes a Participant and, if it is determined that such an
Employee has for any reason not been made a Participant in the Plan or an
administrative adjustment is required, each Employee shall retroactively become
a Participant or such administrative adjustment shall be made. 'The Account of
an Employee who retroactively becomes a Participant or for whom an
administrative adjustment is made shall, upon becoming a Participant or upon
such adjustment, consist solely of the aggregate amount of contributions which
would have been allocated to the Employee's Account had the Employee become a
Participant when first eligible.

3.4   Cessation of Participation. The participation of a Participant shall end
when no further benefits are payable to the Participant or on the Participant's
account under the Plan. Except as otherwise specifically provided in the Plan,
no contributions shall be made for the benefit of, and no contributions, or
Forfeitures or Shares released from a Suspense Subfund shall be allocated, added
or otherwise credited to the Account of, a Participant on or after the date on
which the Participant has a Termination of Service or otherwise ceases to be an
Employee, and before the day, if any, on which the Participant next performs an
Hour of Service as an Employee.
<PAGE>   16
                                                                              13

                                   ARTICLE IV

                              COMPANY CONTRIBUTIONS

4.1   Contributions to Trust Fund.

         (a) Subject to Article XI and the provisions of any applicable loan or
contribution agreement, the Company shall contribute to the Trust Fund for each
Plan Year such sum as the Board of Directors may, in its sole discretion,
determine, which sum may be zero. Any Participating Company may contribute all
or part of the entire amount due on behalf of one or more other Participating
Companies and charge the amount thereof to the Participating Company
responsible therefor. In any Plan Year, the contribution on behalf of the
Participants who are Employees of a Participating Company, when expressed as a
percentage of the aggregate Compensation of such Participants, may, but need not
be, the same as the contribution on behalf of the Participants who are Employees
of another Participating Company.

         (b) All or part of the contributions made under Section 4.1(a) may be
applied to repay principal or interest on any outstanding Exempt Loan. The
Committee may, subject to any pledge or similar agreement, direct or determine
the proportions of such contributions which are applied to repay each such
Exempt Loan.

         (c) All or part of the contributions made under Section 4.1(a) may be
used to purchase Shares allocated to the Account of any Participant or
Beneficiary in order to make a distribution under Article VIII, IX or X to such
Participant or Beneficiary.

4.2   No Participant Contributions. No Participant shall be allowed to
contribute to the Trust Fund.
<PAGE>   17
                                                                              14

                                    Article V

                                   TRUST FUND

5.1   Plan Assets. The Company has entered into the Trust Agreement providing
for the establishment of a single Trust to hold the assets of the Plan. All
contributions shall be paid over to the Trustee and held pursuant to the
provisions of the Plan and the Trust Agreement. The Trustee shall be the named
fiduciary of the Plan for purposes of the Act with respect to all matters
relating to the investment and management of Plan assets, except as otherwise
provided under Sections 5.5, 5.6, 12.1 and 13.1, and the applicable
provisions of the Trust Agreement.

5.2   Accounts. A Participant's interest in the Trust Fund shall be reflected in
the Participant's Account. One or more subaccounts may be established under each
Participant's Account for such purposes as the Committee deems appropriate.
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 the physical segregation of assets for any Account.

5.3   Investment of Trust Fund. The Trust Fund shall be invested exclusively in
Shares, except for cash or cash equivalent investments held (a) for the limited
purpose of making Plan distributions to Participants and Beneficiaries, (b)
pending the investment of contributions or other cash receipts in Shares, (c)
pending use to repay an Exempt Loan, (d) for purposes of paying, under the
terms described in the Plan or Trust Agreement, fees and expenses incurred with
respect to the Plan or Trust and not paid for by the Participating Companies or
(e) in the form of de minimis cash balances.

5.4   Exempt Loan.

         (a) Any Exempt Loan must be primarily for the benefit of Participants
and their Beneficiaries.
<PAGE>   18
                                                                              15

         (b)   Notwithstanding any other provision of the Plan or the Trust, all
proceeds of an Exempt Loan shall be used, within a reasonable time after receipt
by the Trust, only for any or all of the following purposes:

         (i)   to acquire Shares;

         (ii)  to repay the same Exempt Loan; or

         (iii) to repay any previous Exempt Loan.

         (c)   To the extent required by the Code, the Act or the Regulations,
the terms of any Exempt Loan shall comply with each of the following
requirements: (i) the terms shall be at least as favorable to the Plan as the
terms of a comparable loan negotiated at arm's length by independent parties;
(ii) the interest rate shall be no more than a reasonable interest rate
considering all relevant factors including the amount and duration of the Exempt
Loan, the security and guarantee involved, if any, the credit standing of the
Plan and the guarantor of the Exempt Loan, if any, and the interest rate
prevailing for comparable loans; (iii) the Exempt Loan must be for a specific
term and may not be payable at the demand of any person except in the case of
default; (iv) the Exempt Loan shall be without recourse against the Plan, and
the only assets of the Plan that nay be given as collateral on the Exempt Loan
are Shares acquired with the proceeds of the same Exempt Loan or Shares used as
collateral for a prior Exempt Loan, which prior loan is repaid with the proceeds
of the same Exempt Loan; (v) no person entitled to payment under the Exempt Loan
shall have any right to assets of the Plan other than collateral given for the
Exempt Loan, contributions made to the Plan (other than contributions of
employer securities) to enable it to meet obligations under the Exempt Loan and
earnings attributable to such collateral and such contributions, including
dividends on allocated Shares to the extent permitted by the law ("Eligible
Earnings"); (vi) the value of Plan assets transferred in satisfaction of the
Exempt Loan upon an event of default shall not exceed the amount of the default;
provided, however, that, if the lender is a "disqualified person" (as such term
is defined in section 4975(e) of the Code), or a "party in interest" (as such
term is defined in Section 3(14) of the Act), Plan assets may only be
transferred upon default and only to the extent of the failure of
<PAGE>   19
                                                                              16

the Plan to meet the payment schedule of the Exempt Loan; (vii) upon payment of
any portion of the balance due on the Exempt Loan, the assets pledged as
collateral for such portion shall be released from encumbrance in accordance
with Section 6.3; and (viii) payments made from the Trust Fund with respect to
the Exempt Loan during a Plan Year shall not exceed an amount equal to the sum
of amounts contributed to the Plan by the Participating Companies to enable the
Plan to meet its obligations under an Exempt Loan and Eligible Earnings (as
defined in Section 5.4(c)(v)), less any such payments made in prior Plan Years.
Such contributions and earnings shall be accounted for separately in the books
of accounts of the Plan maintained by the Committee or the Trustee until the
Exempt Loan is repaid:

5.5   Accounting and Valuations.

         (a) Subject to the requirements of Section 5.5(e), the fair market
value of the assets of the Trust Fund shall be determined as of each Valuation
Date, in accordance with generally accepted valuation methods and practices
including, but not limited to, in the case of Shares, the use of one or more
independent investment bankers or appraisers.

         (b) The value of a Participant's Account as of any Valuation Date shall
equal the sum of:

         (i) The aggregate fair market value (as determined under Section
5.5(a)) of all Shares allocated to such Participant's Account as of such
Valuation Date;

         (ii) Subject to Section 5.5(c), the aggregate fair market value (as
determined under Section 5.5(a)) of undistributed dividends, if any, received on
Shares allocated to such Participant's Account; and

         (iii) Such Participant's allocable portion (determined in accordance
with the rules set forth in Section 6.4 for determining Participants' allocable
portion of Shares released from the Suspense Subfund) of the undistributed
earnings, if any, on all amounts contributed to the Trust Fund for purposes
other than the repayment of a Exempt Loan.

         (c) Dividends payable, if any, with respect to Shares held by the Trust
Fund will be, to the extent permitted by law and the terms of the Shares on
which such dividends
<PAGE>   20
                                                                              17

are paid, (i) used for the purpose of repaying one or more Exempt Loans, or,
(ii) if no such Exempt Loan is outstanding, and if determined in the discretion
of the Board of Directors (which determination shall be communicated to the
Committee) and in conformity with such terms, (A) distributed from the Trust
Fund to Participants or their Beneficiaries not later than 90 days after the
close of the Plan Year in which they are paid to the Trust Fund, (B) paid
directly to such Participants or their Beneficiaries, (C) retained in the Trust
Fund and allocated pursuant to Section 5.5(b), or (D) paid or utilized in a
combination of any or all of the foregoing three options.

                  (d) The Committee shall establish accounting procedures for
the purpose of making allocations, valuations and adjustments to Participants'
Accounts in accordance with the provisions of the Plan. From time to time, the
Committee may modify its accounting procedures for the purpose of achieving
equitable and nondiscriminatory allocations among the Accounts of Participants
in accordance with the provisions of the Plan.

                  (e) All valuations of Shares, where such Shares are not
readily tradable on an established securities market and where such valuations
relate to activities carried on by the Plan, shall be made by one or more
independent appraisers, retained by and acceptable to the Trustee, who may
be chosen by the Trustee if not chosen by the Committee, and who meet the
requirements, if any, of the Code and Regulations.

5.6 Voting and Tender or Exchange Rights. If any Participating Company has a
registration-type class of securities (as defined in Section 409(e)(4) of the
Code), then, with respect to all corporate matters submitted to shareholders,
all Shares (which for purposes of this Section shall include any securities of
the Company or an Affiliate) shall be voted only in accordance the provisions of
Section 5.6(a), (b), (d) and (e) applicable to voting. If no Participating
Company has a registration-type class of securities (as defined in Section
409(e)(4) of the Code), then, only with respect to corporate matters relating to
a corporate merger or consolidation, recapitalization, reclassification,
liquidation, dissolution, sale of substantially all assets of a trade or
business, or such other similar transaction that Regulations require, all Shares
shall be voted only in accordance with the provisions of
<PAGE>   21
                                                                              18

Section 5.6(a), (b), (d) and (e) applicable to voting. In all cases in which a
"tender offer" (as defined in Section 5.6(a)) is made, the provisions of Section
5.6(a), (c), (d) and (e) applicable to a "tender offer" (as so defined) shall
apply. Where the Trustee is not required to solicit voting instructions under
the second sentence of this paragraph or where the Committee is explicitly
given discretion under Section 5.6(a) or (b), the Trustee shall vote and take
action in connection with a "tender offer" (as so defined), as applicable, only
as the Committee directs in the Committee's sole discretion, after the
Committee determines such action to be in the best interests of Participants
and Beneficiaries.

                  (a) To the extent provided under the foregoing paragraph, the
Trustee shall vote Shares allocated to each Participant's and Beneficiary's
Account (including fractional as well as whole Shares) in accordance with timely
directions of such Participant or Beneficiary, respectively; provided, that a
failure of a Participant or Beneficiary affirmatively to direct timely the
manner in which Shares allocated to the Participant's or Beneficiary's Account
is to be voted shall be deemed for purposes of this Section to be an
affirmative direction to abstain from voting. The Trustee shall, with respect
to shares allocated to each Participant's and Beneficiary's Account (including
fractional as well as whole Shares), act in response to any tender offer or
exchange offer for Shares commenced by a person or persons, including, but not
limited to, a tender offer or exchange offer within the meaning of the
Securities Exchange Act of 1934, as amended from time to time (all such tender
or exchange offers collectively, a "tender offer") in accordance with timely
directions of such Participant or Beneficiary, respectively; provided, that a
failure of a Participant or Beneficiary affirmatively to direct timely the
manner in which the Trustee is to act in response to a tender offer with
respect to Shares allocated to the Participant's or Beneficiary's Account shall
be deemed for purposes of this Section to be an affirmative direction not to
take action with respect to such Shares. For purposes of determining the number
of Shares to be voted in any particular manner or to be the subject of any
particular response to a tender offer, the Trustee shall use the nearest
practicable date as determined by the Trustee.
<PAGE>   22
                                                                              19

                  (b) To the extent provided in the first paragraph of this
Section, the Trustee's functions and responsibilities with respect to Shares,
including Shares in the Suspense Subfund, with respect to voting, shall be
exercised as follows:

                  (i) Each Participant and Beneficiary: (1) is hereby designated
as a named fiduciary for purposes of the Act with respect to the voting of
Shares allocated to the applicable Account, and with respect to the voting of
the applicable portion (as determined under Section 5.6(b)(iii)) of the Shares
held in the Suspense Subfund, and (2) shall have the right to direct the Trustee
with respect to the voting of such Shares on each matter brought before any
meeting of the stockholders of the Company.

                  (ii) Before each such meeting of stockholders, the Trustee
shall cause to be furnished to each Participant and Beneficiary a copy of the
proxy solicitation materials (at or about the same time as such materials are
furnished generally to Company stockholders), together with a form requesting
confidential directions to the Trustee on how the whole and fractional Shares,
which are allocated to such Participant's or Beneficiary's Account (or with
respect to which such Participant or Beneficiary otherwise has control under
Section 5.6(b)(iii)), shall be voted on each such matter. The Company and the
Committee shall cooperate with the Trustee in an attempt to ensure that
Participants and Beneficiaries receive the requisite information in a timely
manner. Upon timely receipt of such directions, the Trustee shall on each such
matter vote as directed the number of Shares (including fractional Shares)
allocated to such Participant's or Beneficiary's Account, and the Trustee shall
have no discretion in such matter. The instructions received by the Trustee from
Participants and Beneficiaries shall be held by the Trustee in confidence and
shall not be divulged or released to any person, including the Committee, or the
officers or employees of the Company or any Affiliate.

                  (iii) The Trustee shall vote all Shares in the Suspense
Subfund in the same proportion as the allocated Shares for which affirmative
directions to vote for or against each proposal are voted. The Committee may
establish procedures, which shall be followed by the Trustee upon and after its
receipt of notice thereof, by which Participants and
<PAGE>   23
                                                                              20
Beneficiaries may provide separate sets of instructions with respect to Shares
allocated to their Accounts and the pro rata amount to unallocated Shares over
which they have voting control. The Trustee shall have no discretion in these
matters. If a vote is taken at a time when there are no allocated Shares, the
Trustee shall vote the Shares in the Suspense Subfund as directed by the
Committee in the Committee's discretion.

                  (c) The Trustee's functions and responsibilities with respect
to Shares, including Shares in the Suspense Subfund, with respect to all
decisions made in response to a tender offer shall be exercised as follows:

                  (i) In the event a tender offer is commenced, the Committee,
promptly after, receiving notice of the commencement of any such tender offer,
shall transfer certain of the Plan's record-keeping functions to an independent
record-keeper (which, if the Trustee consents in writing, may be the Trustee).
The functions so transferred shall be those necessary to preserve the
confidentiality of any directions given by Participants and Beneficiaries, in
connection with the tender offer. The record-keeper shall use its best efforts
to timely distribute or to cause to be distributed to each Participant and
Beneficiary such information as is being distributed to other stockholders of
the Company in connection with any such tender offer. The Company and the
Committee shall cooperate with such recordkeeper in are attempt to ensure that
Participants and Beneficiaries receive the requisite information in a timely
manner. The independent record-keeper shall solicit confidentially from each
Participant and Beneficiary the directions described below as to the action to
be taken with respect to Shares held under the Plan in response to a tender
offer. The independent record-keeper, if different from the Trustee, shall
instruct the Trustee as to required action, including an identification of the
amount of Shares covered by any particular required action, in accordance with
the following provisions.

                  (ii) Each Participant and Beneficiary: (1) is hereby
designated as a named fiduciary for purposes of the Act with respect to all
decisions made in response to a tender offer regarding Shares allocated to the
applicable Account, and with respect to all such decisions regarding the
applicable portion (as determined. under Section 5.6(c)(iv)) of the
<PAGE>   24
                                                                              21

Shares held in the Suspense Subfund, and (2) shall have the right to direct the
Trustee with respect to all such decisions.

                  (iii) Upon timely receipt of such directions, the Trustee
shall on each such matter act as directed (including, without limitation, engage
in selling, exchanging, tendering or retaining) with respect to the number of
Shares (including fractional Shares) allocated to such Participant's or
Beneficiary's Account, and the Trustee shall have no discretion in such matter.
The instructions received by the Trustee from Participants and Beneficiaries
shall be held by the Trustee in confidence and shall not be divulged or released
to any person, including the Committee, or the officers or employees of the
Company.

                  (iv) The Trustee shall act as directed (including, without
limitation, engage in selling, exchanging, tendering or retaining) with respect
to the number of Shares (including fractional Shares) in the Suspense Subfund in
the same proportion as it acts regarding allocated Shares. The Committee may
establish procedures, which shall be followed by the Trustee upon and after its
receipt of notice thereof, by which Participants and Beneficiaries may
provide separate sets of instructions with respect to Shares allocated to their
Accounts and the pro rata amount of unallocated Shares over which they have
control regarding tender offers. The Trustee shall have no discretion in these
matters. If a tender offer occurs at a time when there are no allocated
Shares, the Trustee shall act in response to the tender offer with respect to
Shares in the Suspense Subfund as directed by the Committee in the Committee's
discretion.

                  (d) (i) Nothing contained in this Section shall confer upon
Participants, Beneficiaries, the Committee or the Trustee any additional voting
rights in respect of Shares held under the Plan other than such rights set
forth in the certificate of incorporation of the Company and applicable under
state and federal law.

                  (ii) Nothing contained in this Section shall confer upon
Participants, Beneficiaries, the Committee or the Trustee any additional rights
in respect of a tender offer, merger or consolidation relating to the Shares
held under the Plan other than such rights set
<PAGE>   25
                                                                              22

forth in the certificate of incorporation of the Company and applicable under
state and federal law.

                  (e) Any individual who has an interest under the Plan in the
nature of the interest of a Participant or Beneficiary but who is not
technically a Participant or Beneficiary shall be treated as a Beneficiary for
purposes of the foregoing provisions of this Section.
<PAGE>   26
                                                                              23

                                   ARTICLE VI

                  ALLOCATION OF CONTRIBUTIONS TO THE TRUST FUND

6.1      Allocation of Contributions.

                  (a)(i) For Plan Years beginning prior to January 1, 1999. The
account maintained for each Participant will be credited as of each Anniversary
date with the Participant's allocable. share of (A) Shares contributed to the
Trust Fund or purchased by the Trust Fund using cash contributed by or an behalf
of the Participating Company employing such Participant for contributed directly
to the Trust Fund and (B) Shares released from the Suspense Subfund pursuant to
Section 6.3 and allocable to the contribution made by or on behalf of such
Participating Company pursuant to Section 6.4. The allocation of contributions
of each Participating Company during any Plan Year shall be made only to the
Accounts of those Participants who were Employees of a Participating Company as
of the last day of the Plan Year and who completed at least 1,000 Hours of
Service for such Plan Year; provided, however, that for purposes of this
Section and any other provision of the Plan pertaining to the entitlement to
receive an allocation of contributions, Forfeitures or Shares released from the
Suspense Subfund (including Sections 6.1, 6.4, 7.3 and 11.3), a Participant who
has a Termination of Service while an Employee on account of death, or on or
after the Participant's Retirement date, shall be deemed to have completed 1,000
Hours of Service and to have been employed as an Employee on the last day of the
Plan Year in which such Termination of Service occurs.

                  For plan Years beginning on or after January 1, 1999. The
account maintained for each Participant will be credited as of each payroll date
with the Participant's allocable share of (A) shares contributed to the Trust
Fund or purchased by the Trust Fund using cash contributed by or on behalf of
the Participating Company employing such Participant (for contributed directly
to the Trust Funds) and (B) shares released from the Suspense Subfund pursuant
to Section 6.3 and allocable to the contribution made by or on
<PAGE>   27
                                                                              24

behalf of such Participating Company pursuant to Section 6.4. The allocation of
contributions of each participating Company during the Plan Year shall be made
only to the Accounts of those participants who made elective contributions to
the MBIA Inc. Employees Profit Sharing and Salary Deferral Plan (MBIA 401(k)
Plan).

                  (a)(ii) Special rule for the Plan Year beginning January 1,
1998. Notwithstanding the foregoing, the Account maintained for each Participant
will be credited as of February 16, 1998 with the Participant's allocable share
of (A) Shares purchased by the Trust Fund using cash contributed by or on behalf
of the Participating Company employing such Participant (or contributed directly
to the Trust Fund) and (B) Shares released from the Suspense Subfund pursuant
to Section 6.3(a)(ii) and allocable to the contribution made on or behalf of
such Participating Company pursuant to Section 6.4. The allocation of shares
during the period January 1 through February 16, 1998 (including shares released
from. any dividends paid in 1998 on unallocated shares) shall be made only to
the Accounts of those Participants who were Employees of CapMAC Holdings, Inc.
as of February 16, 1998, without regard to the 1,000 Hours of Service
requirement of section 6.1(a)(i). Shares shall be allocated for this period in
accordance with Section 6.1 (b) except that Compensation as defined in Section
6.1 (b) shall be limited to Compensation earned from January 1, 1998 through
February 16, 1998. For the period from February 17, 1998 through December 31,
1998 and subsequent Plan Years, shares shall be allocated in accordance with
Section 6.1 (a)(i) and 6.1 (b) except that Compensation as defined in Section
6.1 (b) shall be limited to Compensation earned from February 17, 1998 through
December 31, 1998.

                  (b) Allocation of Shares. For purposes of allocating Shares in
proportion to contributions under Sections 6.1(c), 6.4(b)(iii) and 7.3, and the
other purposes of the Plan, contributions for a Plan Year allocable to a
Participating Company shall be allocated among the Accounts of each Participant
to benefit from such contributions, as follows:

                  (I) for Plans Years beginning prior to January 1, 1998, in the
same ratio that the Participant's Compensation from such Participating Company
for the Plan Year while a Participant and an Employee of a Participating Company
bears to the total Compensation
<PAGE>   28
25

from such Participating Company for the Plan Year of all such Participants while
Participants and Employees of a Participating Company,

                  (II) for the period January 1, 1998 to February 16, 1998, in
the same ratio that the Participant's Compensation from such Participating
Company for the period from January 1, 1998 through February 16, 1998 while a
Participant and an Employee of a Participating Company bears to the total
Compensation from such Participating Company for such period of all such
Participants while Participants and Employees of a Participating Company, and

                  (III) for the period February 17, 1998 to December 31, 1998;
in the same ratio that the Participant's Compensation from such Participating
Company for the period from February 17, 1998 to December 31, 1998 while a,
Participant and an Employee of a Participating Company bears to the total
Compensation from such Participating Company for such period of all such
Participants while Participants and Employees of a Participating Company, and

                  (IV) for Plan Years beginning on or after January 9 , 1999, in
an amount equivalent in value (based on the value of such shares as of each
payroll date (or a date with 5 business day of each payroll date) to the amount
of matching contribution that each such Participant would be entitled to under
the MBA 401(k) Plan, reduced by any amount of cash contribution that the Company
nay choose to make to the MBIA 401 (k) Pan on behalf of a Participant to provide
matching contributions.

                  (c) Subject to Section 6.4(b)(ii), Shares purchased by the
Trust Fund for a Plan Year with contributions for a Plan Year (or contributed
directly to the Trust Fund) shall be allocated under Section 6.1 (a)(i) in the
same manner that contributions are allocated under Section 6.1 (b).

                  (d) Allocations of Shares shall be expressed in terms of
numbers of whole and fractional interests in Shares.

6.2      Suspense Subfund. Shares acquired by the Trust Fund through an Exempt
Loan shall be added to and maintained in the Suspense Subfund and shall
thereafter be released
<PAGE>   29
                                                                              26

from the Suspense Subfund and allocated to Accounts of Participants as provided
in Sections 6.3 and 6.4. For purposes of Section 5.6, Shares released from the
Suspense Subfund on account of the repayment of an Exempt Loan but not yet
allocated to Accounts on the books and records of the Plan shall be deemed to
continue to be in the Suspense Subfund.

6.3      Release from Suspense Subfund. Shares acquired for the Trust Fund with
the proceeds of an Exempt Loan shall be released from the Suspense Subfund as
the Exempt Loan is repaid, in accordance with the provisions of this Section.

                  (a)(i) For each Plan Year until an Exempt Loan is fully
repaid, the number of Shares released from the Suspense Subfund shall equal the
number of unreleased Shares attributable to such Exempt Loan immediately before
such release multiplied by the "Release Fraction." As used herein, the term
"Release Fraction" shall mean a fraction, the numerator of which is the amount
of principal and interest paid on the Exempt Loan for such current Plan Year and
the denominator of which is the sum of the numerator plus the principal and
interest to be paid on such Exempt Loan for all future years during the term of
such Exempt Loan (determined without reference to any possible extensions or
renewals thereof). For purposes of computing the denominator of the Release
Fraction, if the interest rate on the Exempt Loan is variable, the interest to
be paid in subsequent Plan Years shall be calculated by assuming that the
interest rate in effect as of the end of the applicable Plan Year will be the
interest rate in effect for the remainder of the term of the Exempt Loan.
Notwithstanding the foregoing, in the event such Exempt Loan shall be repaid
with the proceeds of a subsequent Exempt Loan (the "Substitute Loan"), such
repayment shall not operate to release all such Shares in the Suspense Subfund,
but, rather, such release shall be effected pursuant to the foregoing provisions
of this Section on the basis of payments of principal and interest on such
Substitute Loan.

                  (ii) Notwithstanding anything herein to the contrary, for the
period beginning January 1, through February 16, 1998 the number of shares
released from the suspense subfund shall equal the number of unreleased Shares
attributable to such Exempt
<PAGE>   30
                                                                              27

Loan immediately before such release multiplied by the Special Release Fraction.
For purposes of this Section 6.3(a)(ii) the term "Special Release Fraction"
shall mean a fraction, the numerator of which is the amount of principal paid
and interest paid or accrued on such Exempt loan (including any dividends on
unallocated shares use to pay the Exempt loan) for the period January 1,1998 to
February 16, 1998 and the denominator of which is the sum of the numerator plus
the principal and interest to be paid on such Exempt Loan for all future years,
and portions of a year, during the term of such Exempt Loan (determined without
reference to any possible extensions or renewals thereof). For purposes of this
Section 6.3(a)(ii), if the interest rate on the Exempt Loan is variable, the
interest rate to be paid subsequently to February 16, 1998 shall be calculated
by assuming that the interest rate in effect as of February 16, 1998 shall be
calculated by assuming that the interest rate in effect for the remainder of the
term of the term of the Exempt Loan.

                  (iii) Notwithstanding anything herein to the contrary, for the
period beginning February 17, through December 31, 1998 the number of shares
released from the Suspense Subfund shall equal the number of unreleased Share
attributable to such Exempt Loan immediately before such release multiplied by
the Special Release Fraction. For purposes of this Section 6.3(a)(iii) the term
"Special Release Fraction" shall mean a fraction, the numerator of which is the
amount of principal paid and interest paid or accrued on such Exempt Loan
(including any dividends on unallocated shares use to pay the Exempt loan) for
the period February 17, 1998 through December 31, 1998 and the denominator of
which is the sum of the numerator plus the principal and interest to be paid on
such Exempt Loan for all future years during the term of such Exempt Loan
(determined without reference to any possible extensions or renewals thereof).
For purposes of this Section 6.3(a)(iii), if the interest rate on the Exempt
Loan is variable, the interest rate to be paid subsequently to December 31,
1998 shall be calculated by assuming that the interest rate in effect as of
December 31, 1998 shall be calculated by assuming that the interest rate in
effect for the remainder of the term of the term of the Exempt Loan.
<PAGE>   31
                                                                              28

Notwithstanding the foregoing, in the event such Exempt Loan shall be repaid
with the proceeds of a subsequent Exempt Loan (the "Subsequent Loan"), such
repayment shall not operate to release all such Shares in the Suspense Subfund,
but, rather such release shall be effected pursuant to the foregoing provisions
of this Section on the basis of payments of principal and interest on such
Substitute Loan.

                  (b) If required by any pledge or similar agreement, or if
permitted by such pledge or agreement and required pursuant to a designation by
the Board of Directors, then, in lieu of applying the provisions of Section
6.3(a) with respect to an Exempt Loan, Shares shall be released from the
Suspense Subfund as the principal amount of such Exempt Loan is repaid (without
regard to interest payments), provided, the following three conditions are
satisfied:

                  (i) The Exempt Loan shall provide for annual payments of
principal and interest at a cumulative rate that is not less rapid at any time
than level annual payments of such amounts for 10 years;

                  (ii) The interest portion of any payment shall be disregarded
only to the extent it would be treated as interest under standard loan
amortization tables; and

                  (iii) If the Exempt Loan is renewed, extended or refinanced,
the sum of the expired duration of the Exempt Loan and the renewal, extension
or new Exempt Loan period shall not exceed 10 years.

                  (c) If at any time there is more than one Exempt Loan
outstanding, then separate accounts may be established under the Suspense
Subfund for each such Exempt Loan. Each Exempt Loan for which a separate account
is maintained may be treated separately for purposes of the provisions governing
the release of Shares from the Suspense Subfund under this Section (including
for purposes of determining whether Section 6.3(a) or Section 6.3(b) governs the
release of Shares from any particular separate account) and for purposes of the
provisions governing the application of Participating Company contributions to
repay an exempt loan under section 4.1.
<PAGE>   32
                                                                              29

                  (d) All Shares released from the Suspense Subfund during any
Plan Year shall be allocated among Participants as prescribed by Section 6.4.

6.4      Allocation of Shares Released from Suspense Subfund.

                  (a) Shares released from the Suspense Subfund for a Plan Year
in accordance with Section 6.3 shall be held in the Trust Fund on an unallocated
basis until allocated by the Committee as of the Anniversary Date for that Plan
Year.

                  (b) (i) Where dividends paid on Shares allocated to an Account
("Allocated Dividends") are being used for a Plan Year to pay principal or
interest on an Exempt Loan, a portion of the Shares released from the Suspense
Subfund, which shall be then equal in value to such Allocated Dividends, shall
be allocated to each such Account.

                  (ii) For each Plan Year, the Participating Companies shall
make, at the tine or times determined by the Committee, an additional
contribution if and to the extent that (1) the amount required to restore the
amount of the Allocated Dividends to the Account in accordance with the
requirements of Section 404(k)(2)(B) of the Code, exceeds (2) the value of
Shares available to be allocated to such Accounts from those release from the
Suspense Subfund.

                  (iii) The remaining Shares released from the Suspense
Subfund on account of the payment for a Plan Year of principal or interest on an
Exempt Loan shall be allocated under Section 6.1(a)(ii) in the same proportion
as contributions used to pay principal or interest on such Exempt Loan are
allocated under Section 6.1(b). Notwithstanding, the foregoing, (1) if, with
respect to the Suspense Subfund, principal or interest on an Exempt Loan is paid
for a Plan Year but there is no contribution for such Plan Year that is used
therefor, then, for such Plan Year, Section 6.1(b) shall be applied for purposes
of this Section 6.4(b)(iii) as though such a contribution were made and as
though all Employees of any Participating Company were employed by the same
Participating Company, and (2) where a release of any such remaining Shares from
the Suspense Subfund is attributable to the use of amounts that are not
contributions, in applying Section 6.1(b) for purposes of allocating such Shares
under this Section 6.4(b)(iii), the reference in Section
<PAGE>   33
                                                                              30

6.1 (b) to contributions shall be deemed to be a reference to contributions that
are of a type not subject to Article XI (except to the extent, if any, that such
amounts are subject to Article XI).

                  (c) To the extent that Shares released on account of the use
of dividends and other earnings to pay principal or interest on an Exempt Loan
are insufficient to satisfy, and Shares released on account of the use of
contributions are therefore used under, Section 6.4(b)(i), the allocation of
contributions otherwise provided under Section 6.1(b)(ii) shall be adjusted to
reflect the allocation required by Section 6.4(b)(i).

                  (d) Unless otherwise specifically provided hereunder, all
Shares in the Trust, Fund, other than Shares held in the Suspense Subfund as of
an Anniversary Date, must be allocated to Accounts as of the Anniversary Date.

6.5      Prohibited Allocations.

                  (a) Notwithstanding the foregoing provisions of this Article,
in the event that the Trust acquires Shares in a transaction to which Section
1042 of the Code applies, then, in accordance with the Regulations, such Shares
shall not be allocated, directly or indirectly, to Prohibited Individuals for
the duration of the "nonallocation period" (as defined in Section 409(n)(3)(C)
of the Code).

                  (b) Where any Shares are prevented from being allocated due to
the prohibition contained in Section 6.5(a), the allocation of contributions
otherwise provided under Section 6.1 shall be adjusted to reflect such result.

6.6      Stock Dividends, Splits, Recapitalizations, Etc.

         Any Shares received by the Trustee as a result of a stock split,
dividend, conversion, or as a result of a reorganization or other
recapitalization of the Company shall be allocated as of the day on which such
Shares are received by the Trustee in the same manner as the Shares to which
they are attributable are then allocated.
<PAGE>   34
                                                                              31

                                  ARTICLE VII

                                     VESTING

7.1      Vesting Schedule.

                  (a) A Participant's Vested Interest shall be the percentage of
the amount credited to the Participant's Account determined by the Committee
from the following vesting schedule on the basis of the number of Years of
Service which the Participant has completed as of the date of the Participant's
Termination of Service.

         For Plan Years beginning prior to January 1, 1999:

<TABLE>
<CAPTION>
Years of Service                     Non-forfeitable Percentage
----------------                     --------------------------
<S>                                  <C>
Less than 5                          0%

5 or more                            100%
</TABLE>

         For Plan years beginning on or after January 1, 1999:

<TABLE>
<CAPTION>
Years of Service                     Non-forfeitable Percentage
----------------                     --------------------------
<S>                                  <C>
Less than 3                          0%

3 years                              60%

4 years                              80%

5 years                              100%
</TABLE>

                  (b) Notwithstanding the foregoing, a Participant who is then
an employee of the Company or an Affiliate shall be fully 100% vested in the
Participant's Account on the earlier of the Participant's Normal Retirement
Date; Disability Termination Date, or death.

7.2.     Non-includible Service. The following rules shall apply to the
determination, Participant's non-forfeitable percentage:
<PAGE>   35
                                                                              32

         a) Years of Service before any series of One-Year Breaks in Service
shall be disregarded if a Participant terminates employment, has no
non-forfeitable interest in his benefits, and incurs a consecutive series of
One-Year Breaks in Service that equals or exceeds the greater of:

                  i) his Year of Service prior to such consecutive One-Year
         Breaks in Service; or

                  ii) five (5).

         b) Years of Service after any five (5) consecutive year One-Year
Breaks in Service shall not increase the non-forfeitable percentage of the
Participant's Company Contribution Account which accrued before such One-Year
Breaks in Service.

          7.3. Forfeitures. The non-vested portion of a Participant's Company
Contribution Account shall be forfeited at the time the Participant incurs a
consecutive series of One-Year Breaks in Service of five (5) years, or if
earlier, at the tine the Participant receives a lump sum distribution of the
non-forfeitable portion of his benefit upon his termination of participation in
the Plan. A distribution shall be deemed to be made upon termination of
participation in this Plan if such distribution is made prior to the close of
the second Plan Year following the Plan Year in which such termination occurs. A
Participant who incurs a Termination of Employment without a vested interest in
his Accounts shall be deemed to receive a distribution of the vested portion of
his Accounts on the date of such Termination of Employment.

         Forfeitures arising under this Section 7.3 shall be reallocated to the
Accounts of eligible Plan Participants in the Plan Year in which such
forfeitures arise.

         All Forfeitures shall occur in conformity with the ordering rules of
Section 54.4975-11(d)(4) of the Treasury Regulations.

         Subject to Section 6.1(a), all Forfeitures occurring pursuant to
Section 7.2 with respect to a Plan Year shall be allocated to the Account of
each Participant in the same manner as shares allocated under section 6.1 (b).
<PAGE>   36
                                                                              33

         7.4. Distribution and Re-Employment Before a Break in Service. In the
event that a former Participant who was not 100% vested in his Company
Contribution Account and who received a lump sure distribution upon his
Termination of Employment prior to the tine he incurred consecutive One-Year
Breaks in Service of five (5) years and who forfeited a portion of his Company
Contribution Account upon such distribution, is re-employed by the Company or
an ERISA Affiliate prior to the time he incurs a consecutive series of One Year
Breaks in Service of five (5) years, such Participant may elect on a form
prescribed by the Administrative Committee to repay to the Plan in cash, on any
Valuation Date prior to the earlier of (A) the fifth anniversary date of his
re-employment or (B) his incurring a consecutive series of One-Year Breaks in
Service of five (5) years, the full amount distributed to hire upon his prior
Termination of Employment (for this purpose, a distribution of a zero amount
shall deemed as automatically repaid upon a former Participant's re-employment).
In such event, the amount repaid plus the amount forfeited by such Participant
upon his prior Termination of Employment will be restored and credited to his
Account as of such Valuation Date. Any forfeited amounts so restored shall be
derived, to the extent necessary and in the following order, from:

         a) The amount, if any, of Participant forfeitures that would otherwise
be allocated under Section 7.3;

         b) The amount, if any, of the Trust Fund net income or gain for the
Plan Year. To the extent the amounts available for restoration for a particular
Plan Year is insufficient to enable (the Administrative Committee to make the
required restoration, the Employer shall contribute, without regard to any
requirement or condition of Article Four, such additional amount as is necessary
to enable the Administrative Committee to make the required restoration. If, for
a particular Plan Year, the Administrative Committee must restore the Account of
more than one (1) re-employed Participant, then the Administrative Committee
shall make the restoration allocations) to each such Participant's Account in
the same proportion that a Participant's restored amount for the Plan Year bears
to the aggregate restored amount for the Plan Year of all re-employed
Participants. The Administrative
<PAGE>   37
                                                                              34

Committee shall not take into account the allocation(s) under this Section 7.4
in applying the limitations set forth in Sections 11.2 and 11.3.
<PAGE>   38
                                                                              35

                                  ARTICLE VIII

                               RETIREMENT BENEFITS

8.1 Normal Retirement Date. A Participant's Normal Retirement Date shall be the
later of the fifth anniversary of the Participant's participation in the Plan or
the date the Participant attains age 65.

8.2 Deferred Retirement Date. If a Participant remains an Employee after the
participant's Normal Retirement Date, the Participant shall participate in the
contributions and benefits of the Plan in the same manner as any other
Participant. The Deferred Retirement Date of a Participant who remains as
Employee after the Participant's Normal Retirement Date shall be the first day
of the month coincident with or following the date of the Participant's
Termination of Service.

8.3 Disability Termination Date. A participant shall be considered, if the
Participant so elects, to have retired for the purposes of the Plan on the
Participant's Disability Termination Date, which shall be the date of the
Participant's Termination of Service on account of the Participant's Disability,
regardless of age. The determination of the Committee as to whether a
Participant has a Disability and the date of such Disability shall be final,
binding and conclusive.

8.4 Method of Distribution. Subject to Article XII, Section 8.6(d) and the
second sentence of Section 8.6(a), distribution of a Participant's Vested
Interest shall be made in a lump sum.

8.5 Distribution in Shares.

                  (a) (i) Unless the Participant elects otherwise, distribution
of a Participant's Vested Interest from the Participant's Account will be made
entirely in whole Shares, with the value of any fractional interest in Shares
paid in cash. To the extent a distribution is to be made in Shares, any cash or
other property in a Participant's Account will be used to acquire Shares from
the Company (based on the value of such Shares as of the roost recent
<PAGE>   39
                                                                              36

Valuation Date) for distribution. To the extent there is any fractional interest
in a Share, and the distribution of such fractional interest is to be made in
cash, (1) distributable Shares in a Participant's Account shall be liquidated,
with the proceeds, net of expenses of liquidation, being distributed, or (2)
cash in the Plan may be utilized based on the value of such Shares as of the
most recent Valuation Date preceding distribution.

         (ii) Notwithstanding the foregoing, if applicable corporate charter or
bylaw provisions restrict ownership of substantially all outstanding Shares to
Employees or to a plan or trust described in Section 401(a) of the Code, then
any distribution of a Participant's Vested Interest shall be in cash.

                   (b) Distribution to a Participant shall be based upon the
amount of Shares, and the value of any other allocations, consisting of the
Vested Interest in the Participant's Account on the Valuation Date coinciding
with or immediately preceding the date of distribution.

8.6 Benefit Commencement.

                  (a) Subject to Sections 8.b(b), 8.6(c) and 16.6; unless the
Participant elects a later date (or Section 8.6(e) requires an earlier date),
the payment of any benefit to which a Participant is entitled under the Plan
shall commence as soon as practicable (and not more than 60 days) after (i)
the close of the Plan Year in which the Participant retires on a Retirement Date
or, in all other cases, (ii) the close of the Plan Year in which occurs the
latest of (1) the 10th anniversary of the year in which the Participant
commenced Plan participation, (2) the Participant's attainment of age 65, or (3)
the Participant's Termination of Service. Distributions required in connection
with subsequent allocations made pursuant to the provision of the last sentence
of Section 6.1(a) shall be made in one single sum distribution as soon as
practicable. Notwithstanding the foregoing, if the amount payable cannot be
ascertained, or, subject to the provisions of Section 16.6, the Participant
cannot be located after reasonable efforts, a payment retroactive to the date
determined under the forgoing sentence may be made not later than 60 days after
the earliest day on which the
<PAGE>   40
                                                                              37

amount of such payment can be ascertained under the Plan or the date on which
the Participant is located (whichever is applicable).

                  (b) Notwithstanding Section 8.6(a),(I) no distribution on
account of Section 8.6(a)(i) shall be made unless the Participant does not again
become an Employee on or prior to the day as of which the Participant's
distribution is otherwise to be commenced, and (II) the commencement of the
distribution of the Participant's benefit shall not, unless the Participant
elects otherwise or the provisions of the last sentence of Section 8.6(a) apply,
be deferred under the provisions of Section 8.6(a)(ii) beyond the 60th day after
the close of the Plan Year in which the Participant, while a former Employee,
attains the Participant's Normal Retirement Date.

                  (c) Prior to July 1, 1999, subject to Section 16.6, unless the
Participant elects a later date (or Section 8.6(a) or (e) requires an earlier
date), payment of any benefit to which a Participant is entitled shall commence
not later than one year after the close of the Plan Year (i) in which the
Participant incurs a Termination of Service due to the occurrence of the
Participant's Retirement Date or death, or (ii) which is the fifth Plan Year
following the Plan Year in which the Participant's Termination of Service
occurs for any reason other than a Retirement Date or death, provided, that the
Participant is not reemployed by the Company or an Affiliate before distribution
is required to begin under this Section 8.6(c). Notwithstanding the foregoing,
section 8.6(c)(ii) shall not apply to shares held in the Participant's Account
until the close of the Plan Year in which the Exempt Loan or Exempt Loans, if
any, used to acquire such Shares had been repaid in full. Effective July 7,
1999, subject to section 16.6, unless the Participant elects a later date (or
section 8.6(a) or (e) requires an earlier date), payment of any benefit to which
a Participant is entitled shall commence not later than one year after the close
of the Plan Year in which the Participant incurs a Termination of Service due to
the occurrence of the Participant's Retirement Date or death, disability or
Termination of Employment, provided, that the Participant is not reemployed by
the Company or an Affiliate before distribution is required to begin under this
Section 8.6(c).
<PAGE>   41
                                                                              38

                  (d) Notwithstanding the foregoing, but subject to Sections
8.6(e) and 16.6, (i) a Vested Interest with a value of $5,000 or less shall be
distributed in a single sum distribution as soon as practicable after the close
of the Plan Year in which occurs the Participant's Termination of Service, and
(ii) a Vested Interest with a value of more than $5,000 shall not commence to be
distributed to the Participant before the Participant's Normal Retirement Date
without the Participant's consent upon notice given to the Participant in
accordance with the applicable Treasury Regulations. Where such consent is not
given to a distribution otherwise provided for above, but is given before such
Normal Retirement Date, distribution shall be made, subject to the other
provisions of Section 8.6(a) and (b), (i) after the Valuation Date coincident
or next following the giving of such consent and (ii) as of such Valuation
Date provided, that the Participant notifies the Committee a reasonable time
before such Valuation Date of the Participant's intent to provide consent.

                  (e) Notwithstanding the foregoing, and except as provided in
Section 16.6, if a Participant who has not been a five percent (5%) owner (as
defined in Section 416(i) of the Code) at any time in the Plan Year ending in
the calendar year in which such Participant attains age 70-1/2, the
Participant's required distributions under Code Section 401(a)(9) shall begin
April 1 of the calendar year following the later of: (i) the calendar year in
which the Participant attains age 70-1/2; or (ii) the calendar year in which
the Participant retires.

                  (f) For a Participant who is a five percent (5%) owner (as
defined in Section 416(i) of the Code), his or her required distribution under
Code Section 401(a)(9) shall begin no later than the earlier of (i) the 60th day
of the later of the close of the Plan Year in which the Participant attains age
65, or the Participant's service terminates; or (ii) the April 1 of the
calendar year in which the Participant attain age 70-1/2.

8.7 Diversification. An individual may elect, within 90 days after the close of
the first Plan Year in which the Participant becomes a Qualified Participant (as
defined below) and within 90 days of the close of each of the four succeeding
Plan Years, to have up to 25 percent of the total number of Shares that have
been allocated to the Qualified Participant's
<PAGE>   42
                                                                              39

Account on or before the most recent Anniversary Date (inclusive of Shares which
were subject to a prior election pursuant to this Section), reduced by any
Shares which were the subject of a prior election pursuant to this Section,
distributed to the Qualified Participant in the form of a single payment. For
purposes of this Section, a "Qualified Participant" shall mean an individual
who (a) has been a participant in the Plan for 10 years after the Effective Date
and (b) has attained age 55. Such a Qualified Participant may also elect, within
90 days after the close of the Plan Year within which the last such election is
offered, to have 50 percent of the total number of Shares that have been
allocated to the Qualified Participant's Account on or before the most recent
Anniversary Date (inclusive of Shares which were subject to a prior election
pursuant to this Section), reduced by any Shares which were the subject of a
prior election pursuant to this Section, distributed to the Qualified
Participant in the form of a single payment. The Qualified Participant shall
make the election during the Qualified Election Period which is the six (6) Plan
Year period beginning with the 1st Plan Year in which the individual first
becomes a Qualified Participant.

8.8 Direct Transfer Option. This Section applies to distributions made on or
after January 1, 1993. Notwithstanding any provisions of the Plan to the
contrary that would otherwise limit a distributee's election under this Section,
a distributee may elect, at the time and in the manner prescribed by the
plan administrator, to have any portion of an eligible rollover distribution
paid directly to an eligible retirement plan specified by the distributee in a
direct rollover.

                  (a) Definitions

                        (i) Eligible rollover distribution: An eligible
rollover distribution is any distribution of all or any portion of the balance
to the credit of the distributee, except that an eligible rollover distribution
does not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the life
(or life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated beneficiary,
or for a specified period of ten years
<PAGE>   43
                                                                              40

or more; any distribution to the extent such distribution is required under
Section 401(a)(9) of the Code; and the portion of any distribution that is not
includible in gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities).

                        (ii) Eligible retirement plan: An eligible retirement
plan is an individual retirement account described in Section 408(b) of the
Code, an individual retirement annuity described in Section 408(b) of the Code,
an annuity plan described in Section 403(a) of the Code, or a qualified trust
described in Section 401(a) of the Code, that accepts the distributee's eligible
rollover distribution. However, in the case of an eligible rollover distribution
to the surviving spouse, an eligible retirement plan is an individual retirement
account or individual retirement annuity.

                  (iii) Distributee: A distributee includes an employee or
former employee. In addition, the employee's or former spouse who is
the alternate payee under a qualified domestic relations order, as defined in
Section 414(p) of the Code, are distributees with regard to the interest of
the spouse or former spouse.

                  (iv) Direct rollover: A direct rollover is a payment by the
plan to the eligible retirement plan specified by the distributee.
<PAGE>   44
                                                                              41

                                   ARTICLE IX

                                 DEATH BENEFITS

9.1 Death Prior to Other Termination of Service. Subject to Section 8.5(a), upon
the death of a Participant prior to the Participant's Termination of Service
with the Company and all Affiliates, all amounts then credited to the
Participant's Account shall be distributed in one single sum distribution to the
Participant's Beneficiary. Such distribution shall be made as soon as
practicable after the end of the Plan Year in which the Participant's death
occurs. The amount distributed shall be based on the value of the decedent's
Account on the Valuation Date coinciding with or immediately preceding the date
of distribution. Distributions required in connection with subsequent
allocations made pursuant to the requirements of the proviso of the last
sentence of Section 6.1(a) shall be made as soon as administratively
practicable.

9.2 Death After Termination of Employment. Upon the death of a Participant after
retirement, Disability or other Termination of Service with the Company and all
Affiliates, but prior to the distribution of the Participant's entire Vested
Interest, the Committee shall direct the Trustee to make distribution of any
balance of the decedent's Vested Interest in the manner provided in Section 9.1.
<PAGE>   45
                                                                              42

                                   ARTICLE X

                          DESIGNATION OF BENEFICIARIES

10.1 Beneficiary Designation. Each Participant shall file with the Committee a
written designation of one or more persons as the Beneficiary who shall be
entitled to receive the amount, if any, payable under the Plan upon the
Participant's death. A Participant may from time to time revoke or change the
Beneficiary designation without the consent of any prior Beneficiary by filing a
new designation with the Committee. Notwithstanding the foregoing, no
designation of a nonspouse Beneficiary by a Participant shall be given effect
unless such Participant's Surviving Spouse, if any, had consented in writing
to such designation and, if the requirements of Section 417(a)(2)(A)(ii) of the
Code and the Regulations are met, to all future designations; provided, that (a)
spousal consent shall not be required where the spouse cannot be located or on
account of such other circumstances, if any, as are set forth in the Regulations
and (b) spousal consent, if required, must acknowledge the effect of such
designation and be witnessed by a Plan representative or notary public. The last
such designation received by the Committee shall be controlling; provided,
however, that no designation, or change or revocation thereof, shall be
effective unless received by the Committee prior to the Participant's death, and
in no event shall it be effective as of a date prior to such receipt. All
decisions of the Committee concerning the effectiveness of any Beneficiary
designation, and the identity of any Beneficiary, shall be final. If a
Beneficiary shall die after the death of the Participant and prior to receiving
the distribution that would have been made to such Beneficiary had such
Beneficiary's death not occurred, and no alternate Beneficiary has been
designated, then for the purposes of the Plan the distribution that would have
been received by such Beneficiary shall be made to the Beneficiary's estate.

10.2 Failure to Designate Beneficiary. Subject to Section 10.1, if no
Beneficiary designation is in effect at the time of a Participant's death, the
payment of the amount, if any,
<PAGE>   46
                                                                              43

payable under the Plan upon death shall he made to the Participant's Surviving
Spouse, if any, or if the Participant has no Surviving Spouse, to the
Participant's estate. If the Committee is in doubt as to the right of any person
to receive such amount, the Committee may direct the Trustee to retain such
amount, without liability for any interest thereon, until the rights thereto are
determined, or the Committee may direct the Trustee to pay such amount into any
court of appropriate jurisdiction and such payment shall be a complete discharge
of the liability of the Plan and the Trust therefor.
<PAGE>   47
                                                                              44
                                   ARTICLE XI

                          MAXIMUM AMOUNT OF ALLOCATION

11.1 Application of Article XI. The provisions of this Article XI shall govern
notwithstanding any other provisions of the Plan, and shall be applied with
respect to each Limitation Year.

11.2 Maximum Additions to Account. Annual Additions to a Participant's Account
may not exceed the lesser of (a) the greater of $30,000 (or such other amount
as is permissible under Section 415(c)(1)(A) of the Code), or (b) 25 percent of
the Participant's compensation (as defined in Section 1.415-2(d) of the Income
Tax Regulations prior to January 1, 1998, and as defined in Code Section
415(c)(3)(D) effective January 1, 1998) for the Plan Year. For this purpose,
the term "Annual Additions" shall mean the following amounts which, without
regard to this Article, would have been credited to the Participant's Account
for any Plan Year: (a) Participating Company contributions which are used to
repay principal and/or pay interest on one or more Exempt Loans, or to purchase
(or which are made in the form of) Shares, which are allocated to such
Participant's Account, (b) Forfeitures which arise under the Plan and are
allocable to such Participant's Account in respect of such Plan Year, and (c)
such other amounts with respect to other plans as may be required to be included
under the Code and Regulations; provided, however, that if no more than
one-third of Participating Company contributions for a Plan Year which are
deductible under Section 404(a)(9) of the Code would be allocated, in the
aggregate, to the Accounts of Participants described in Section 414(q) of the
Code, then "Annual Additions" shall not include (i) any Participating Company
contributions which are used to pay interest on one or more Exempt Loan, and
(ii) Forfeitures of Shares acquired with the proceeds of an Exempt Loan. In the
case of Limitation Year of less than twelve (12) months duration, the dollar
limit of clause (a) above, as adjusted, shall be proportionately reduced.

         Notwithstanding any other provision in the Plan, "Annual Additions"
shall exclude, without limitation, any (a) rollover contributions, (b) Shares
released from the Suspense
<PAGE>   48
                                                                              45

Subfund for the Plan Year, (c) contributions used to pay interest on an Exempt
Loan, (d) reallocated Forfeitures of Shares acquired with the proceeds of an
Exempt Loan, (e) contributions and allocations made in connection with the
satisfaction of the requirements of Section 6.4(b)(i) and (ii), (f) restorations
under Section 7.2(b) and (g) dividends and other earnings (and any assets
acquired therewith).

11.3 Order of Reduction. After reducing to the extent permitted by law the
annual additions to a Participant's account in any other defined contribution
plan maintained by a Participating Company or an Affiliate, if the amounts which
would otherwise be allocated to a Participant's Account must be reduced by
reason of the limitations of Section 11.2, such reduction shall be made in the
following order of priority, but only to the extent necessary and permitted by
the Regulations:

                  (a) Forfeitures of Shares not acquired with the proceeds of an
Exempt Loan arising under the Plan and allocable to such Account in respect of
such Plan Year (without regard to Section 11.2) shall be allocated to the
Accounts of other eligible Participants as of the end of the current Plan Year
in the manner provided under Section 7.3; and then

                  (b) Participating Company contributions allocable to such
Account in respect of such Plan Year and Shares allocable in proportion thereto
(without regard to Section 11.2,) shall be allocated to the Accounts of other
eligible Participants at the end of the current Plan Year in the manner provided
under Section 6.1(b), and, to the extent such allocation cannot be made under
Section 11.2, then reallocated at the end of the succeeding Plan Years in such
manner and as provided in Section 11.3(c).

                  (c) Any amount to be allocated under Section 11.3(b) at the
end of a succeeding Plan Year shall be allocated to a suspense account until
such tine as any amount in the suspense account can be allocated to
Participants' Accounts without having to be reallocated under Section 1I.3(b);
provided, that, to the extent required by the Regulations, no contribution shall
be made in such a succeeding Plan Year which would restrict such reallocation.
<PAGE>   49
                                                                              46

11.4 Additional Account Limitations.

            For Plan Years prior to January 1, 2000, in the event that, in any
Plan Year and with respect to any Participant, the sum of the "Defined
Contribution Fraction" and the "Defined Benefit Fraction" (both as defined for
purposes of Section 415 of the Code) would otherwise exceed 1.0, the benefit
payable under the defined benefit plan shall be reduced in accordance with the
provisions of that plan, but only to the extent necessary to ensure that such
limitation is not exceeded. If this reduction does not ensure that the
limitation is not exceeded, then the annual addition to any defined contribution
plan, other than the Plan, shall be reduced in accordance with the provisions of
that plan but only to the extent necessary to ensure that such limitation is not
exceeded. If this reduction does not ensure that the limitation is not exceeded,
then the Annual Addition to the Plan shall be reduced in accordance with the
provisions of the Plan, but only to the extent necessary to ensure that such
limitation is not exceeded. For Plan Years beginning after December 31, 1999,
the provisions of Section 11.4 shall no longer be applicable.

                   65
<PAGE>   50
                                                                              47

                                   ARTICLE XII

                          RIGHTS AND OPTIONS CONCERNING

                               DISTRIBUTED SHARES

12.1 RIGHT of First Refusal.

                  (a) All distributions of Shares that are not publicly traded
to any Participant, Beneficiary or other distributee (each, a "Distributee") by
the Trust shall be subject to a "right of first refusal" upon the terms and
conditions hereinafter set forth. The "right of first refusal" shall provide
that prior to any transfer (as determined by the Committee) of the Shares, the
Distributee must first offer to sell such Shares to the Company and, if the
Company refuses to exercise its right to purchase the Shares, then the Trust
shall have a "right of first refusal" to purchase such Shares. Neither the
Company nor the Trust shall be required to exercise the "right of first
refusal."

                  (b) The terms and conditions of the "right of first refusal"
shall be determined as follows:

                  (i) if the Distributee receives a bona fide offer for the
purchase of all or any part of the Distributee Shares from a third party, the
Distributee shall forthwith deliver (by registered mail, return receipt
requested) a copy of any such offer to the Committee. The Company or the
Trustee (as directed by the Committee), as the case may be, shall then have 14
days after receipt by the Committee of the written offer to exercise the right
to purchase all or any portion of the Shares. Subject to Section 12.1(b)(ii),
the purchase price to be paid by the Company or the Trust for the Shares shall
be the purchase price stated in the bona fide offer received by the Distributee;
and
                  (ii) The selling price and other terms under the "right of
first refusal", must not be less favorable to the Distributee than the
greater of the value of the Shares determined pursuant to the Regulations or the
purchase price and other terns offered by a buyer other than the Company or the
Trust, making a good faith. offer to purchase the Shares.
<PAGE>   51
                                                                             48

12.2 Put 0ption. If, at the time of distribution (or at any time during a
period during which the put option described below may be exercised), Shares
distributed from the Trust (or Shares used under this Section to purchase such
distributed Shares) are not treated as "readily tradable on an established
market" within the meaning of Section 409(h) of the Code, such Shares shall be
subject to a put option in the hands of a Qualified Holder (as defined in
Section 12.2(a)) by which such Qualified Holder may sell to the Company all or
any part of the Shares distributed to the Qualified Holder by the Trust. Should
the Company initially decline to purchase all or any part of the Shares put to
it by the Qualified Holder, the Trust may purchase those Shares that the Company
declines to purchase. Should the Trust so decline, the Company shall purchase
those Shares that the Trust declines to purchase. The put option shall be
subject to the following conditions:

                  (a) The term "Qualified Holder" shall mean the Distributee
receiving the distribution of such Shares, any other party to whom the Shares
are transferred by gift or by reason of death and any trustee of an individual
retirement account (as defined under Section 408 of the Code to which all or any
portion of the distributed Shares (or Shares paid for such distributed Shares
under this Section) is transferred pursuant to a tax-free "rollover"
transaction satisfying the requirements of Sections 402 and 408 of the Code.

                  (b) During the 60-day period following any distribution of
such shares, a Qualified Holder shall have the right to require the Company or
the Trust, as applicable, to purchase all or a portion of the distributed Shares
(or Shares paid for such distributed Shares under this Section) held by the
Qualified Holder. Except as otherwise required by law, the purchase price to be
paid for any such Shares shall be their fair market value determined as of the
Valuation Date (which, for purposes of this Section, shall include the last day
of each month) coinciding with or next preceding the payment in response to the
exercise of a put option under this Section. The purchase shall occur as soon as
administratively feasible after, but not before the end of the month of, such
exercise.

                  (c) If a Qualified Holder shall fall to exercise the Qualified
Holder's put option right under Section 12.2(b), the option right shall
temporarily lapse upon the
<PAGE>   52
                                                                              49

expiration of the 60-day period. As soon as practicable following the last day
of the Plan Year in which the 60-day option period expires, the Company shall
notify the non-electing Qualified Holder (if the Qualified Holder is then a
shareholder of record) of the valuation of the Shares as of that date. During
the 60-day period following receipt of such valuation notice, the Qualified
Holder shall again have the right to require the Company or the Trust, as
applicable, to purchase all or any portion of the distributed Shares (or Shares
paid for such distributed Shares under this Section). Except as otherwise
required by law, the purchase price to be paid therefor shall be based on the
valuation of the Shares as of the Valuation Date coinciding with or next
preceding the payment in response to the exercise of a put option under this
Section. The purchase shall occur as soon as administratively feasible after,
but not before the end of the month of, such exercise.

                  (d) The foregoing put options under Section 12.2(b) and (c)
shall be effective solely against the Company and shall not obligate the Plan or
Trust in any manner.

                  (e) Except as otherwise permitted by Section 409(h) or (l) of
the Code, applicable Regulations or other applicable law, (i) the put-option
provisions of this Article 12 shall apply to Shares, if acquired with the
proceeds of an Exempt loan, when held under or distributed from the Plan whether
or not the Plan at that tine is or contains an "employee stock ownership plan"
within the meaning of Section 4975(e)(7) of the Code, and (ii) no Shares
acquired with the proceeds of an Exempt Loan may be subject to a put, call or
other, option, or buy-sell or similar arrangement (other than this article 12)
while held by or distributed from the Plan. Without limiting the generality of
the foregoing, in no event may the Plan obligate itself to acquire securities
from a particular security holder at an indefinite tine determined upon the
happening of an event such as the death of the holder.

12.3 Exercise of Put Option. If a Qualified Holder exercises the put option
under Section 12.2, the Qualified Holder shall have the right to have payment
for the Shares repurchased made, in the case of a distribution within one
taxable year of the balance to the credit of the Participant's Account (other
than a $5,000 or less distribution under Section 8.6(d)(i)), in substantially
equal annual payments over a period beginning not later than 30
<PAGE>   53
                                                                              50

days after the exercise of the put option and not exceeding five years
(provided, that adequate security and reasonable interest are provided with
respect to unpaid amounts) or, in the case of other distributions, not later
than 30 days after such exercise.
<PAGE>   54
                                                                              51
                                  ARTICLE XIII

                           ADMINISTRATION OF THE PLAN

13.1 Powers and Duties of the Committee.

                  (a) The Committee shall have general responsibility for the
administration and interpretation of the Plan (including but not limited to
complying with reporting and disclosure requirements, and establishing and
maintaining Plan records). Such interpretations (including, without limitation
interpretations relating to the determination of eligibility under the Plan and
the disposition of claims for benefits under the Plank and other actions of the
Committee shall be afforded the maximum deference allowed by law. The Committee
shall engage such certified public accountants and other advisers and service
providers, who may be accountants, advisors or service providers for the Company
or an Affiliate, as it shall require or may deem advisable for purposes of the
Plan.

                  (b) To the extent that the Trust Fund is invested in assets
other than Shares, the Committee shall have the power to appoint or remove one
or more investment advisers and to delegate to such adviser authority and.
discretion to manage (including the power to acquire and dispose of) the assets
of the Plan, provided, that (i) each adviser with such authority and discretion
shall be either a bank, an insurance company or a registered investment adviser
under the Investment Advisers Act of 1940, and shall acknowledge in
writing that it is fiduciary with respect to the Plan and (ii) the Committee
shall periodically review the investment performance and methods of each adviser
with such authority and discretion.

                  (c) Notwithstanding any provision of the Plan to the contrary,
the Committee shall have those additional powers, rights and obligations
provided under the Trust Agreement.

13.2 Certain Powers and Duties. Except as otherwise provided in the Plan or
Trust Agreement, the Trustee shall have exclusive responsibility for the
management and control

<PAGE>   55
                                                                              52

of the assets of the Trust Fund and shall have discretionary responsibility for
the investment and management of such assets; provided, however, that, subject
to Section 5.3, the Trustee shall invest all assets in Shares except as is
otherwise required under an exempt loan agreement, the terms of the Trust
Agreement, or under applicable law. Other than with respect to such
responsibilities, except as otherwise provided in the Trust Agreement or the
Plan, the Trustee may act only as directed by the Committee, the Company or any
other party, as applicable.

13.3     Agents: Report of Committee to Board. The Committee may arrange for the
engagement of such legal counsel, who may be counsel for the Company or an
Affiliate, and make use of such agents and clerical or other personnel as it
shall require or may deem advisable for purposes of the Plan. The Committee may
rely upon the written opinion of such counsel and the accountants engaged by
the Committee, and may delegate to any such agent, or to any subcommittee or
member of the Committee, its authority to perform any act hereunder, including,
without limitation, those matters involving the exercise of discretion;
provided, that such delegation shall be subject to revocation at any time at the
discretion of the Committee. The Committee shall report to the Board of
Directors, or to a committee of the Board of Directors designated for that
purpose, as frequently as shall be specified by the Board of Directors or such
committee, with regard to the matters for which it is responsible under the
Plan.

13.4     Structure of Committee. The Committee shall consist of three or more
members, each of whom shall be appointed by, shall remain in office at the
will of, and nay be removed, with or without cause, by the Board of Directors.
Any member of the Committee may resign at any time. No member of the Committee
shall be entitled to act on or decide any matter relating solely to the member
or any of the member's rights or benefits under the Plan. In the event that the
Committee is unable to act in any matter by reason of the foregoing restriction,
the Board of Director: shall act on such matter. The members of the Committee
shall not receive any special compensation for serving in their capacities as
members of the Committee but shall be reimbursed for any reasonable expenses
incurred in
<PAGE>   56
                                                                              53

connection therewith; provided, that, if and to the extent permitted by law,
reasonable compensation may be paid if and to the extent that the Company so
directs. Except as otherwise required by the Act, no bond or other security need
be required of the Committee or any member thereof in any jurisdiction. Any
member of the Committee, any subcommittee or agent to whom the Committee
delegates any authority, and any other person or group of persons, may serve in
more than one fiduciary capacity (including service both as a trustee and
administrator) with respect to the Plan.

13.5     Adoption of Procedures of Committee. The Committee shall establish its
own procedures and the time and place for its meetings, and provide for the
keeping of minutes of all meetings. A majority of the members of the Committee
shall constitute a quorum for the transaction of business at a meeting of the
Committee. Any action of the Committee may be taken upon the affirmative vote of
a majority of the members of the Committee at a meeting or without a meeting, by
mail, telegraph or telephone, provided, that all of the members of the Committee
are informed by mail, teletransmission or telegraph of their right to vote on
the proposal and of the outcome of the vote thereon.

13.6     Demands for Money. Except as otherwise provided in the Trust Agreement,
all demands for money from the Plan shall be signed by a member of the Committee
or such other person or persons as the Committee may from time to time designate
in writing. Such person shall cause to be kept full and accurate accounts of
receipts and disbursements of the Plan, shall cause to be deposited all funds
of the Plan to the name and credit of the Plan, in such depositories as may be
designated by the Committee, shall cause to be disbursed the monies and funds of
the Plan when so authorized by the Committee, and shall generally perform such
other duties as may be assigned to such person from time to time by the
Committee.

13.7     Claims for Benefits. All claims for benefits under the Plan shall be
submitted in writing to, and within a reasonable period of time decided by, a
majority of the Committee. Written notice of the decision on each such claim
shall be furnished within 90 days after receipt of the claim; provided, that, if
special circumstances require an extension of time for
<PAGE>   57
                                                                              54

processing the claim, an additional 90 days from the end of the initial period
shall be allowed for processing the claim, in which event the claimant shall be
furnished with a written notice of the extension prior to the termination of the
initial 90-day period indicating the special circumstances requiring an
extension. If the claim is wholly or partially denied, such written notice shall
set forth an explanation of the specific findings and conclusions on which such
denial is based. A claimant may review all pertinent documents and may request a
review by the Committee of such a decision denying the claim. Such a request
shall be made in writing and filed with the Committee within 60 days after
delivery to said claimant of written notice of said decision. Such written
request for review shall contain all additional information which the claimant
wishes the Committee to consider. The Committee may hold any hearing or conduct
any independent investigation which it deems necessary to render its decision,
and the decision on review shall be made as soon as possible after the
Committee's receipt of the request for review. Written notice of the decision on
review shall be furnished to the claimant within 60 days after receipt by the
Committee of a request for review, unless special circumstances require an
extension of time for processing, in which event an additional 60 days shall be
allowed for review and the claimant shall be so notified in writing. Written
notice of the decision on review shall include specific reasons for such
decision. For all purposes under the Plan, such decisions on claims (where no
review is requested) and decisions on review (where review is requested) shall
be final, binding and conclusive on all interested parties as to participation
and benefit eligibility, the Employee's amount of Compensation and as to any
other matter of fact or interpretation relating to the Plan.

13.8     Hold Harmless. To the maximum extent permitted by law, no member of the
Committee shall be personally liable by reason of any contract or other
instrument executed by the member or on the member's behalf in the capacity as a
member of the Committee nor for any mistake of judgment made in good faith, and
the Company shall indemnify and hold harmless, directly from its own assets
(including the proceeds of any insurance policy the premiums of which are paid
from the Company's own assets), each member of the
<PAGE>   58
                                                                              55

Committee and each other officer, employee, or director of the Company or an
Affiliate to whom any duty or power relating to the administration or
interpretation of the Plan or to the management and control of the assets of the
Plan may be delegated or allocated, against any cost or expense (including
counsel fees) or liability (including any sum paid in settlement of a claim with
the approval of the Company) arising out of any act or omission to act in
connection with the Plan unless arising out of such person's own fraud or bad
faith.

13.9     Service of Process. The Committee, or such other person as may from
time to time be designated by the Board of Directors, shall be the agent for
service of process under the Plan.
<PAGE>   59
                                                                              56

                                   ARTICLE XIV

                       WITHDRAWAL OF PARTICIPATING COMPANY

14.1     Withdrawal of Participating Company. Any Participating Company (other
than the Company) may withdraw from participating in the Plan by giving the
Committee and the Trustee prior written notice in a resolution by its board of
directors specifying a withdrawal date which shall be the last day of a month at
least 30 days subsequent to the date such notice is received by the Committee or
the Trustee, whichever receives such notice the latest. A Participating Company
shall withdraw from participation in the Plan if and when it ceases to be either
a division of the Company or an Affiliate. The Committee may require any
Participating Company to withdraw from the Plan, as of any withdrawal date
specified by the Committee, for the failure of the Participating Company to make
proper contributions or to comply with any other provision of the Plan and shall
require a Participating Company's withdrawal upon its complete and final
discontinuance of contributions.

14.2     Distribution after Withdrawal. Upon withdrawal from the Plan by any
Participating Company, such Participating Company shall not make any further
contributions under the Plan and no amount shall thereafter be payable under the
Plan to or in respect of any Participants then employed by such Participating
Company except as provided in this Article XIV. To the maximum extent permitted
by the Act, the withdrawal from the Plan by any Participating Company shall not
in any way affect any other Participating Company's participation in the Plan.

14.3     Transfer to Successor Plan. No transfer of the Plan's assets and
liabilities to a successor employee benefit plan (whether by merger or
consolidation with such successor plan or otherwise) shall be made unless each
Participant would, if either the Plan or such successor plan then terminated,
receive a benefit immediately after such transfer which (after taking account of
any distributions or payments to them as part of the same transaction) is equal
to or greater than the benefit the Participant would have been entitled to
receive immediately before such transfer if the Plan had then been terminated.
<PAGE>   60
                                                                              57

                    AMENDMENT OR TERMINATION OF THE PLAN AND
                                      TRUST

15.1     Right to Amend, Suspend or Terminate Plan.

                  (a) Subject to the provisions of Section 15.1(b) and any
applicable contribution or loan agreement, the Board of Directors reserves the
right at any time to amend, suspend or terminate the Plan, any contributions
thereunder, the Trust, or any contract issued by an insurance carrier foreign a
part of the Plan, in whole or in part, and for any reason and without the
consent of any Participating Company, Participant, Beneficiary, Surviving Spouse
or other eligible survivor. Each Participating Company by its participation in
the Plan shall be deemed to have delegated this authority to the Board of
Directors. The Plan shall automatically be terminated upon complete and final
discontinuance of contributions thereunder.

                  (b) No amendment or modification shall be made which would
retroactively (i) reduce, in contravention of Section 411(d)(6) of the Code, any
accrued benefits or (ii) make it possible for any part of the funds of the Plan
(other than such part as is rewired to pay taxes, if any, and administrative
expenses as provided in Section 16.14) to be used for or diverted to any
purposes other than for the exclusive benefit of Participants and their
beneficiaries and Surviving Spouses and other eligible survivors under the Plan
prior to the satisfaction of all liabilities with respect thereto.

15.2     Retroactivity. Subject to the provisions of Section 15.1, any
amendment, modification, suspension or termination of any provisions of the Plan
may be made retroactively if necessary or appropriate.

15.3     Notice. Notice of any amendment, modification, suspension or
termination of the Plan shall be given by the Board of Directors or the
Committee, whichever adopts the amendment, to the other and to the Trustee and
all Participating Companies.
<PAGE>   61
                                                                              58

15.4     No Further Contributions.

                  (a) Upon termination of the Plan or a complete discontinuance
of contributions, no Participating Company shall make any further contributions
under the Plan and no amount shall thereafter be payable under the Plan to or in
respect of any Participant except as provided in this Article. To the maximum
extent permitted by the Act, transfers, distributions or other dispositions of
the assets of the Plan as provided in this Article shall constitute a complete
discharge of all liabilities under the Plan. The Committee shall remain in
existence and all of the provisions of the Plan which in the opinion of the
Committee are necessary for the execution of the Plan and the administration,
distribution, transfer or other disposition of the assets of the Plan in
accordance with this Section shall remain in force.

                  (b) After (i) appropriate adjustment of the Accounts of
Participants who are employed as of the date of such termination in the manner
described in Section 7.3 for any Forfeitures arising under the Plan prior to
such date and (ii) adjustment for profits and losses of the Trust Fund to such
termination date in the manner described in section 5.5, each Account of a
Participant which Account contains a Vested Interest (determined without regard
to this Section, but with regard to all forfeiture provisions of the Plan) as of
the date of such termination shall be fully vested as of such date; provided,
that the Board of Directors may by appropriate resolution provide that amounts
credited to the Accounts of other Participants shall be nonforfeitable as of
such date. All nonvested amounts after application of the foregoing sentence
shall be treated as Forfeitures in the Plan Year of and prior to such
termination.

                  (c) Except as may be prohibited by Section 411(a)(11) of the
Code and the Regulations thereunder, upon or after the termination of the Plan
the Board of Directors may terminate the Trust and upon such termination the
Trustee shall pay in a single sum distribution to each Participant the full
amount credited to the Participant's Account and the unallocated Shares in the
Suspense Subfund attributable to an Exempt Loan from the Company to the Trust
shall, to the extent it would not result in a violation of the Code, Act and
Regulations, be returned to the Company in full satisfaction of any outstanding
Exempt
<PAGE>   62
                                                                              59

Loan from the Company to the Trust; provided, however, that the fair market
value of such unallocated Shares that may be returned to the Company may not
exceed the remaining unpaid balance of such Exempt Loan and outstanding accrued
interest, as such fair market value is determined by an independent investment
bank or appraiser. Without limiting the foregoing, any such distributions may be
made in cash, Shares, other property, or any combination, as the Committee in
its sole discretion may direct in accordance with the Code and Regulations.

15.5     Partial Termination. In the event that a "partial termination" (within
the meaning of Section 411(d)(3) of the Code) of the Plan has occurred then (a)
the interest of each affected Participant in the Participant's Account as to
whom such termination occurred shall thereupon be nonforfeitable, but shall
otherwise be payable as though such termination had not occurred and (b) the
provisions of Sections 15.2, 15.3, 15.4 and Section 14.2 which in the opinion of
the Committee are necessary for the execution of the Plan and the allocation and
distribution of the assets of the Plan shall apply; provided, however, that the
Board of Directors, in its discretion, subject to any necessary governmental
approval, may direct that the amounts held in the Accounts of such Participants
as to whom such partial termination occurred be segregated by the Trustee as a
separate plan and applied for the benefit of such Participants in the manner
described in Section 15.4. In the case of a sale of all or a significant portion
of the assets used by a Participating Company in a trade or business or of the
sale of all or a significant portion of a Participating Company's interest in a
subsidiary, the Company, in its sole discretion, may elect to treat any
similarly situated employees of such trade or business or such subsidiary as
fully vested hereunder.
<PAGE>   63
                                                                              60

                                  ARTICLE XVI

                       GENERAL LIMITATIONS AND PROVISIONS

16.1     All Risk on Participants and Beneficiaries. Except as may otherwise be
required by the Act, (a) each Participant and Beneficiary shall assume all risk
in connection with any decrease in the value of the Accounts, (b) the
Participating Companies and the Committee shall not be liable or responsible for
any decrease in the value of the Accounts and (c) without limiting the
generality of the foregoing, neither the Board of Directors, any Participating
Company, the Committee, any member of the Committee nor the Trustee shall be
responsible for the adequacy of the Trust Fund to meet and discharge Plan
liabilities.

16.2     Trust Fund Is Sole Source of Benefits. Without limiting the generality
of Section 16.1, the Trust Fund shall be the sole source of benefits under the
Plan and, except as otherwise required by the Act, the Participating Companies
anal the Committee assume no liability or responsibility for payment of such
benefits, and each Participant, Beneficiary or other person who shall claim the
right to any payment under the Plan shall be entitled to look only to the Trust
Fund for such payment and shall not have any right, claim or demand therefor
against the Trustee, any Participating Company, the Committee or any member
thereof, or any employee or director of any Participating Company.

16.3     No Right to Continued Employment. Nothing contained in the Plan shall
give any employee the right to be retained in the employment of the Company or
any of its subsidiaries or affiliated or associated corporations or affect the
right of any such employer to dismiss any employee. The adoption and maintenance
of the Plan shall not constitute a contract between any Participating Company
and any employee or consideration for, or an inducement to or condition of, the
employment of any employee.

16.4     Payment on Behalf of Payee. If the Committee shall find that any person
to whom any amount is payable under the Plan is unable to care for the person's
affairs because of illness or accident, or is a minor, or has died, then any
payment due the person or the person's estate (unless a prior claim therefor has
been made by a duly appointed legal
<PAGE>   64
                                                                              61

representative) may, if the Committee so elects, be paid to the person's spouse,
a child, a relative, an institution maintaining or having custody of such
person, or any other person deemed by the Committee to be a proper recipient on
behalf of such person otherwise entitled to payment. Any such payment shall be a
complete discharge of the liability of the Plan and the Trust therefor.

16.5     Anti-Alienation. Except, pursuant to a Qualified Domestic Relations
Order or insofar as applicable law may otherwise require, no economic interest,
expectancy, benefit, payment, claim or right of any Participant or Beneficiary
under the Plan and the Trust shall be subject in any manner to any claims of any
creditor of any Participant or Beneficiary, nor to alienation by anticipation,
sale, transfer, assignment, bankruptcy, pledge, attachment, charge or
encumbrance of any kind. If any person shall attempt to take any action
contrary to this Section, such action shall be null and void and of no effect,
and the Trustee shall disregard such action and shall not in any manner be bound
thereby and shall suffer no liability on account of its disregard thereof.

         For purposes of the Plan, a "Qualified Domestic Relations Order" means
any judgment, decree or order (including approval of a property settlement
agreement) which has been determined by the Committee in accordance with
procedures established under the Plan to constitute a qualified domestic
relations order within the meaning of Section 414(p)(1) of the Code.

16.6     Missing Payee. If the Committee cannot ascertain the whereabouts of any
person to whom a payment is due under the Plan, and if, after five years from
the date such payment is due, a notice of such payment due is mailed to the last
known address of such person, as shown on the records of the Committee or the
Company, and within three months after such mailing such person has not made
written claim therefor, the Committee, if it so elects, after receiving advice
from counsel to the Plan, nay direct that such payment and all remaining
payments otherwise due to such person be canceled on the records of the Plan and
the amount thereof applied as though it were a Forfeiture, and upon such
cancellation, the Plan and Trust shall have no further liability therefor,
except that, in the event such person later
<PAGE>   65
                                                                              62

notifies the Committee, of the person's whereabouts and requests the payment or
payments, due to such person under the Plan, the amounts so applied shall be
paid to such person as provided herein.

16.7     Subject to Funding Documents. Any and all rights or benefits accruing
to any persons under the Plan shall be subject to the terms of the Trust
Agreement which the Company shall enter into with the Trustee providing for the
administration of the Trust Fund. If the payment of any benefit under the Plan
is provided for by a contract with an insurance company, the payment of such
benefit shall also be subject to all the provisions of such contract.

16.8     Communications.

                  (a) All elections, designations, requests, notices,
instructions and other communications from a Participating Company, a
Participant, Beneficiary or other person to the Committee required or Permitted
under the Plan shall be in such form as is prescribed from time to time by the
Committee, shall be mailed by first class mail or delivered to such location as
shall be specified by the Committee, and shall be deemed to have been given and
delivered only upon actual receipt thereof by the Committee at such location.

                  (b) All notices, statements, reports and other communications
from a Participating Company or the Committee to any employee, Participant,
Surviving Spouse, Beneficiary or other person required or permitted under the
Plan shall be deemed to have been duly given when delivered to, or when mailed
by first class mail, postage prepaid and addressed to, such employee,
Participant, Surviving Spouse, Beneficiary or other person at the person's
address last appearing on the records of the Committee, or when posted by the
Participating Company or the Committee as permitted by law.

                  (c) Each Participant shall file with the Committee such
pertinent information concerning the Participant, the Participant's spouse and
the Participant's Beneficiary, or such other person as the Committee may
specify, and, except as may otherwise be required by law, no Participant,
Beneficiary, or other person shall have any
<PAGE>   66
                                                                              63

rights or be entitled to any benefits under the Plan unless such information is
filed by or with respect to the applicable individual.

16.9     Transfers and Rollovers. Neither the Plan nor the Trust shall accept
funds transferred, directly or indirectly (including a rollover from a conduit
individual retirement account, an individual retirement annuity or a retirement
bond) to the Plan or Trust from an employee benefit plan, whether or not such
plan is qualified under Section 401(a) of the Code.

16.10    Gender. Whenever used in the Plan the masculine gender includes the
feminine.

16.11    Captions. The captions preceding the sections of the Plan have been
inserted solely as a matter of convenience and in no way define or limit the
scope or intent of any provisions of the Plan.

16.12    Applicable Law. The Plan and all rights thereunder shall be governed by
and construed in accordance with the Act and, to the extent state law is found
to be applicable, the laws of the State of New York.

16.13    Return of Contributions. The provisions of this Section shall apply
notwithstanding any other provision of the Plan.

                  (a) if any contribution is made due to a mistake of fact, such
contribution shall upon the direction of the Company, which shall be given in
conformity with the provisions of the Act, be returned to the Company or the
parties who made it, as directed by the Company, without liability to any
person.

                  (b) The Plan is entered into on the conditions that (i) the
Plan and the Trust Agreement shall be approved by the IRS as a qualified and
exempt plan and trust under the provisions of the Code and Regulations so that
contributions to the Trust may be deducted for Federal income tax purposes,
within the limits of the Code and Regulations, and be nontaxable to Participants
when contributed and (ii) the Plan shall be approved by the IRS as an "employee
stock ownership plan" within the meaning of Section 4975(e)(7) of the Code. If
such initial approval should be denied for any reason (including failure to
comply with any conditions for such approval imposed by the IRS), contributions
made after the
<PAGE>   67
                                                                              64

execution of the Trust Agreement and prior to such denial and all assets in the
Trust Fund shall be returned to the Company, without any liability to any
person, within one year after the date of denial of such approval, and any
Exempt Loans, to the extent provided under the terms thereof, and related
Suspense Subfunds shall be canceled.

                  (c) All contributions are hereby expressly conditioned upon
their deductibility under Section 404 of the Code and Regulations, as amended
from time to time, and if the deduction for any contribution is disallowed in
whole or in part, then such contribution (to the extent the deduction is
disallowed) shall upon direction of the Committee, which shall be given in
conformity with the provisions of the Act, be returned, without liability to any
person, within one year after such disallowance.

16.14    Fees and Expenses. The expenses of administering the Plan including (a)
the fees and expenses of any employee and of the Trustee for the performance of
their duties under the Trust, (b) the expenses incurred by the members of the
Committee in the performance of their duties under the Plan (including
reasonable compensation for any legal counsel, certified public accountants and
any agents and cost of services rendered in respect of the Plan), and (c) all
other proper charges and disbursements of the Trustee or the members of the
Committee (including settlements of claims or legal actions brought against any
party, including the Trustee, approved by the Company and the Committee), are to
be paid by the Trust unless, in the Company's sole discretion (but subject to
any agreements entered between the Company and the Trustee), paid by the
Participating Companies or in full by the Company. In estimating costs under the
Plan, administrative costs may be anticipated. The members of the Committee
shall not receive any special compensation for serving in their capacities as
members of the Committee.

16.15    Exclusive Benefit of Participants and Beneficiaries. In no event shall
any part of the funds of the Plan be used for or diverted to any purposes other
than for the exclusive benefit of Participants and their Beneficiaries under the
Plan except as permitted under Section 403(c) of the Act. Upon the transfer by a
Participating Company of any money to the Trustee, all interest of the
Participating Company therein shall cease and terminate.
<PAGE>   68
                                                                              65

16.16    Participation by Participating Companies. The Board of Directors shall
not give consent under Section 2.22 with respect to an entity adopting the Plan
unless, with respect to such entity, Shares held under the Plan would then
constitute "qualifying employer securities" within the meaning of Section
407(d)(5) of the Act and Section 4975(e)(8) of the Code; provided, that the
Board of Directors may, subject to the foregoing requirement relating to Shares
held under the Plan, waive the requirement that the board of directors or
equivalent governing body referred to in Section 2.22 effect such adoption. By
its adoption of or participation in the Plan, a Participating Company shall be
deemed to appoint the Company its exclusive agent to exercise on its behalf all
of the power and authority conferred by the Plan or by the Trust Agreement upon
the Company and accept the delegation to the Committee and the Trustee of all
the power and authority conferred upon them by the Plan and the Trust Agreement.
The authority of the Company to act as such agent shall continue until the Plan
is terminated as to the Participating Company and the relevant Trust Fund assets
have been distributed by the Trustee as provided in Article XIV or Article XV of
the Plan.
<PAGE>   69
                                                                              66

                                  ARTICLE XVII
                              TOP HEAVY PROVISIONS

17.1     Top Heavy Plan. The Plan will be considered a Top Heavy Plan for any
Plan Year if it is determined to be a Top Heavy Plan as of the last day of the
preceding Plan Year or, with respect to the first Plan Year, the last day of
such Plan Year. Notwithstanding any other provisions in the Plan, the provisions
of this Article shall apply and supersede all other provisions in the Plan
during any Plan Year with respect to which the Plan is determined to be a Top
Heavy Plan.

17.2     Definitions for Article XVII. For purposes of this Article and as
otherwise used in the Plan, the following terms shall have the meanings set
forth below:

                  (a) "Aggregation Group" shall mean the group composed of each
qualified retirement plan of the Company or an Affiliate in which a Key Employee
is a participant and each other qualified retirement plan of the Company or an
Affiliate which enables a plan of the Company or an Affiliate in which a Key
Employee is a participant to satisfy Section 401(a)(4) or 410 of the Code. In
addition, the Company may choose to treat any other qualified retirement plan as
a member of the Aggregation Group if such Aggregation Group will continue to
satisfy Sections 401(a)(4) and 410 of the Code with such plan being taken into
account. For purposes of determining whether the Plan is part of an Aggregation
Group, all qualified retirement plans (whether or not terminated) maintained by
the Company or an Affiliate in which a Key Employee participates in the Plan
Year containing the day determined under the first sentence of Section 17.1 or
any of the preceding four Plan Years shall be taken into account to the extent
required by Section 416(g) of the Code and the Regulations thereunder.

                  (b) "Key Employee" shall mean a key employee as defined in
Section 416(i) of the Code and Section 1.416-1 (T-12--T-21) of the Treasury
Regulations. For purposes of determining which employee is a Key Employee,
compensation shall mean Compensation for purposes of Article XI.
<PAGE>   70
                                                                              67

                  (c) "Top Heavy Plan" shall mean a "Top Heavy Plan" as defined
in Section 416(g) of the Code and Regulations, and, accordingly, a plan shall be
considered a Top Heavy Plan for any Plan Year in which the Top Heavy Ratio
exceeds 60%. For purposes of determining whether a plan is a Top Heavy Plan, the
value of Account balances shall be determined as of the most recent Valuation
Date within the 12-month period ending on the day determined under the first
sentence of Section 17.1.

                  (d) "Top Heavy Ratio" shall mean the ratio of (i) the account
balances (in the case of a defined contribution plan) and present value of
accrued benefits (in the case of a defined benefit plan) for Key Employees under
all plans in the Aggregation Group to (ii) the account balances and present
value of accrued benefits for all employees in all plans in the Aggregation
Group, without regard to the account balances and accrued benefits, as
applicable, for Key Employees who performed no services for the Company or an
Affiliate during the five-year period ending on the day determined under the
first sentence of Section 17.1, calculated as of the day determined under the
first sentence of Section 17.1 and otherwise in accordance with Section 416 of
the Code and the Regulations thereunder.

17.3     Minimum Contribution and Vesting.

                  (a) Subject to Section 17.4, for each Plan Year that the Plan
is a Top Heavy Plan, the Company contribution (including Forfeitures) allocable
to the Account of each Participant who has performed an Hour of Service at the
end of the Plan Year and who is not a Key Employee, shall not be less than the
lesser of (i) three percent of such Participant's Compensation, for purposes of
Article XI, or (ii) the percentage at which contribution's and Forfeitures for
such Plan Year are made and allocated on behalf of the Key Employee for whom
such percentage is the highest. For the purpose of determining the appropriate
percentage under Section 17.3(a)(ii), all defined contribution plans required
to be included in an Aggregation Group shall be treated as one plan. Section
17.3(a)(ii) shall not be applicable if the Plan is required to be included in an
Aggregation Group which enables a defined benefit plan also required to be
included in said Aggregation Group to satisfy Section 401(a)(4) or 410 of the
Code.
<PAGE>   71
                                                                              68

                  (b) For each Plan Year that the Plan is a Top Heavy Plan, each
Participant with three or more Years of Service shall be 100 percent vested in
the Participant's Account Limitations on Contributions.

17.4      Limitations on Contributions.

                  (a) For each Plan Year that the Plan is a Top Heavy Plan, 1.0
shall be substituted for 1.25 as the multiplicand of the dollar limitation in
determining the denominator of the defined benefit plan fraction and of the
defined contribution plan fraction for purposes of Section 415(e) of the Code.

                  (b) If, after substituting 90 percent for 60 percent wherever
the latter appears in Section 416(g) of the Code, the Plan is not determined to
be a Top Heavy Plan, the provisions of Subsection (a) shall not be applicable if
the minimum Participating Company contribution (including Forfeitures) allocable
to the Account of any Participant who is not a Key Employee as specified in
Section 17.3 is determined by substituting "4" for "3."

17.5     Other Plans. The Committee shall, to the extent permitted by the Code
and in accordance with the Regulations, apply the provisions of this Article by
taking into account the benefits payable and the contributions made under any
other plans maintained by the Company or any of its subsidiaries or affiliated
or associated entities which are qualified under Section 401(a) of the Code to
prevent inappropriate omissions or required duplication of minimum benefits or
contributions.
<PAGE>   72
                                                                              69

IN WITNESS WHEREOF, the Company has caused The Plan to be executed this
_______ day of _________, 1999, to be effective as specified in the Plan.

                                      MBIA

                                      By:
                                         ---------------------------------

                                      Title:
                                            ------------------------------

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