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                                                                    EXHIBIT 4.11

                                  CONOCO INC.

              DEFERRED COMPENSATION PLAN FOR NONEMPLOYEE DIRECTORS

               (AS AMENDED AND RESTATED EFFECTIVE OCTOBER 8, 2001)

                                    RECITALS

                  Conoco Inc. (the "Company") established the Conoco Inc.
Deferred Compensation Plan for NonEmployee Directors (the "Plan").

                  The Company intends to reclassify its Class A Common Stock and
Class B Common Stock into a single class of new common stock ("Common Stock") by
merging Conoco Delaware I, Inc., a wholly owned subsidiary of the Company
("Merger Sub"), with and into the Company (the "Merger"), pursuant to an
Agreement and Plan of Merger, dated as of July 17, 2001, between the Company and
Merger Sub. In connection with the Merger and pursuant to their authority under
Paragraph VI.5, the Board has authorized this amendment and restatement of the
Plan to reflect the new class of Common Stock.

                  Now, therefore, the Company hereby amends and restates the
Plan, effective as set forth in Paragraph VI.7 hereof, to read as follows:

                                   I. ARTICLE
                        PURPOSES OF PLAN AND DEFINITIONS

         I.1 Purpose. Pursuant to the 1998 Stock and Performance Incentive Plan,
Conoco Inc., a Delaware corporation, established the Conoco Inc. Deferred
Compensation Plan for Non-Employee Directors for the purpose of providing
nonemployee directors of the Company the opportunity to defer a portion of their
compensation and to provide greater incentives for those Directors to attain and
maintain the highest standards of performance, to attract and retain Directors
of outstanding competence and ability, to stimulate the active interest of such
persons in the development and financial success of the Company, to further the
identity of interests of such Directors with those of the Company's stockholders
generally, and to reward such Directors for outstanding performance.

         I.2 Definitions.

                  "Applicable Annual Rate" will initially be 7.14% and will be
adjusted as of January 1 of each year to that rate which is equal to 120% of the
applicable federal long-term rate for the month of January of such year as
published by the Internal Revenue Service pursuant to Section 1274(d) of the
Code.

                  "Award" means any incentive award made to a Participant under
the Plan or any other Plan of the Company.

                  "Beneficiary" means the person(s) or entity(ies) designated by
the Participant, as provided in Section IV.5, to receive any payments otherwise
due the Participant under this Plan in the event of the Participant's death.

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

                  "Cash Compensation" means all of the cash compensation payable
to a Participant, including annual, meeting and other fees.

                  "Change in Control" means a Change in Control as defined in
the 1998 Stock and Performance Incentive Plan of Conoco Inc., as amended from
time to time.

                  "Class A Common Stock" means the Class A Common Stock, par
value $.01 per share, of the Company.

                  "Class B Common Stock" means the Class B Common Stock, par
value $.01 per share, of the Company.

                  "Code" means the Internal Revenue Code of 1986, as amended
from time to time.

                  "Committee" means such committee of the Board as is designated
by the Board to administer the Plan in accordance with Article II.

                  "Common Stock" means Conoco common stock, par value of $.01
per share.

                  "Company" means Conoco Inc.

                  "Deferred Compensation Period" means such period of 365 days
(or such longer or shorter period) as shall from time to time be prescribed by
the Committee for which Participants shall be entitled to defer receipt of all
or any part of their Cash Compensation.

                  "Deferred Interest Bearing Account" means the bookkeeping
account maintained for each Participant to record certain amounts deferred by
the Participant in accordance with Article III hereof.

                  "Determination Date" means the date on which payment of a
Participant's deferred compensation is made or commences, as determined in
accordance with Section IV.1.

                  "Director" means an individual who is serving as a member of
the Board.

                  "Effective Date" means the IPO Closing Date.

                  "Election Effective Date" means the date upon which a
Participant's deferred compensation is credited to his Deferred Interest Bearing
Account pursuant to Section III.3 of this Plan.

                  "Eligible Director" means each Director who is not an employee
of the Company or of any of the Company's subsidiaries.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.

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                  "Fair Market Value" of a share of Common Stock means, as of a
particular date, (i) if Common Stock is listed on a national securities
exchange, the mean between the highest and lowest sales price per share of such
Common Stock on the consolidated transaction reporting system for the principal
national securities exchange on which shares of such Common Stock are listed on
that date, or, if there shall have been no such sale so reported on that date,
on the next succeeding date on which such a sale was so reported, (ii) if Common
Stock is not so listed but is quoted on the Nasdaq National Market, the mean
between the highest and lowest sales price per share of Common Stock reported by
the Nasdaq National Market on that date, or, if there shall have been no such
sale so reported on that date, on the next succeeding date on which such a sale
was so reported, (iii) if Common Stock is not so listed or quoted, the mean
between the closing bid and asked price on that date, or, if there are no
quotations available for such date, on the next succeeding date on which such
quotations shall be available, as reported by the Nasdaq Stock Market, or, if
not reported by the Nasdaq Stock Market, by the National Quotation Bureau
Incorporated or (iv) if Common Stock is not publicly traded, the most recent
value determined by an independent appraiser appointed by the Company for such
purpose.

                  "IPO Closing Date" means the date on which the Company first
receives payment for the shares of common stock of the Company it sells in the
IPO.

                  "Participant" means an Eligible Director who elects to
participate in the Plan or is otherwise credited with Stock Units pursuant to
Article III.

                  "Stock Account" means the bookkeeping account maintained for
each Participant to record certain amounts deferred by the Participant in
accordance with Article III hereof.

                  "Stock Unit" means a unit equal to one share of Common Stock
(as determined in accordance with Section III.2) (as adjusted pursuant to
Section III.6), utilized for the purpose of measuring the benefits payable under
Section IV.3.

                  "Total Deferred Unit Amount" means the aggregate Fair Market
Value on the Valuation Date coinciding with or immediately preceding the
Determination Date of the number of Stock Units then credited to a Participant's
Stock Account.

                  "Valuation Date" means the Effective Date and the first day of
each month thereafter or, in the event Common Stock is traded or quoted on a
national securities exchange or in the over-the-counter market, each day on
which a sale or sales of such Common Stock is reported or a quotation for such
Common Stock is available (as the case may be).

                  "1998 Incentive Plan" means the 1998 Stock and Performance
Incentive Plan of Conoco Inc.

                                  II. ARTICLE
                           ADMINISTRATION OF THE PLAN

         II.1 Committee. This Plan shall be administered by the Committee. The
Committee shall consist of at least two members of the Board.

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         II.2 Committee's Powers. Subject to the provisions hereof, the
Committee shall have full and exclusive power and authority to administer this
Plan and to take all actions which are specifically contemplated hereby or are
necessary or appropriate in connection with the administration hereof. The
Committee shall also have full and exclusive power to interpret this Plan and to
adopt such rules, regulations and guidelines for carrying out this Plan as it
may deem necessary or proper, all of which powers shall be exercised in the best
interests of the Company and in keeping with the objectives of this Plan. The
Committee may, in its discretion, determine the eligibility of individuals to
participate herein, determine the amount of Cash Compensation a Participant may
elect to defer, or waive any restriction or other provision of this Plan. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in this Plan in the manner and to the extent the Committee deems
necessary or desirable to carry it into effect.

         II.3 Committee Determinations Conclusive. Any decision of the Committee
in the interpretation and administration of this Plan shall lie within its sole
and absolute discretion and shall be final, conclusive and binding on all
parties concerned.

         II.4 Committee Liability. No member of the Committee or officer of the
Company to whom the Committee has delegated authority in accordance with the
provisions of Section II.5 of this Plan shall be liable for anything done or
omitted to be done by him or her, by any member of the Committee or by an
officer of the Company in connection with the performance of any duties under
this Plan, except for his or her own willful misconduct or as expressly provided
by statute.

         II.5 Delegation of Authority. The Committee may delegate to the Chief
Executive Officer and to other senior officers of the Company its duties under
this Plan pursuant to such conditions or limitations as the Committee may
establish.

                                  III. ARTICLE
                                    ACCOUNTS

         III.1 Establishment of Accounts. The Company shall set up an
appropriate record (hereinafter called the "Deferred Interest Bearing Account")
which will from time to time reflect the name of each Participant and the
amounts deferred by such Participant to an interest bearing account pursuant to
Section III.2. The Company shall also set up an appropriate record (hereinafter
called the "Stock Account") which will from time to time reflect the name of
each Participant, the number of Stock Units credited to such Participant
pursuant to Section III.2, and the Fair Market Value of that number of Stock
Units credited to the Participant.

         III.2 Deferred Compensation.

                  (a) A Participant may elect to defer receipt of all or any
         part of the Cash Compensation payable to the Participant for serving on
         the Board of Directors for any Deferred Compensation Period. At the
         election of the Participant, the amount deferred shall be credited to:
         (a) his or her Deferred Interest Bearing Account; (b) his or her Stock
         Account; or (c) a combination of both. If a Participant chooses to
         receive a credit to his Stock Account, a number of Stock Units (rounded
         up to the nearest whole number) as elected by the Participant with the
         consent of the Committee, having a Fair Market Value

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         on the Election Effective Date equal to the dollar amount of fees the
         Participant elects to forego in the applicable Deferred Compensation
         Period in exchange for Stock Units shall be credited to such account. A
         Participant may only elect to defer Cash Compensation which is
         otherwise payable after an election to defer compensation is made
         pursuant to Section V.1 hereof.

                  (b) As additional deferred compensation and pursuant to the
         requirements of paragraph 9 of the 1998 Incentive Plan, each Eligible
         Director shall be credited with certain Stock Units on the initial
         election of an individual as an Eligible Director and on each
         subsequent Annual Director Award Date, as provided for in paragraph 9
         of the 1998 Incentive Plan.

         III.3 Crediting of Deferred Amounts.

                  (a) Any Cash Compensation credited to a Participant's Deferred
         Interest Bearing Account or Stock Account shall be credited to such
         account on the last day of the month in which the deferred Cash
         Compensation would otherwise have been paid (the "Election Effective
         Date"). For example, if a Participant effectively elects to defer Cash
         Compensation to his Deferred Interest Bearing Account for a Deferred
         Compensation Period of 365 days beginning January 1 by notifying the
         Company in the manner provided in Section V.1, the Cash Compensation
         which accrues for the month of January shall be credited to such
         Participant's Deferred Interest Bearing Account on January 31.

                  (b) Any Stock Units credited under the 1998 Incentive Plan to
         a Participant as described in Section III.2(b) hereof shall be credited
         to the Participant's Stock Account as of the date specified in Section
         III.2(b) hereof.

         III.4 Interest on Deferred Interest Bearing Accounts. The amount of
deferred compensation credited to a Participant's Deferred Interest Bearing
Account will bear interest from (but excluding) the date so credited, to (and
including) the Determination Date, at a rate per annum equal to the Applicable
Annual Rate in effect from time to time, compounded monthly, and such interest
shall be credited to the Deferred Interest Bearing Account as of the last day of
each calendar month during the applicable Deferred Compensation Period and the
last day of the calendar month in which such period ends (or, if applicable, the
Determination Date). Interest so credited shall similarly bear interest from
(but excluding) the date so credited, to (and including) the Determination Date,
at a rate per annum equal to the Applicable Annual Rate in effect from time to
time, compounded monthly and credited as of the last day of each calendar month
during the applicable Deferred Compensation Period and the last day of the
calendar month in which such period ends (or, if applicable, the Determination
Date).

         III.5 Dividends. As of each date that dividends are paid with respect
to Common Stock, a Participant who has any outstanding Stock Units relating to
Common Stock credited to his Stock Account shall have a number of Stock Units
relating to that Common Stock credited to his Stock Account with respect to such
dividends. The Stock Units credited in respect of dividends shall have a Fair
Market Value equal to the dollar amount of the dividend paid per share of Common
Stock as of such dividend payment date multiplied by the number of Stock

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Units relating to Common Stock credited to the Participant's Stock Account
immediately prior to such dividend payment date.

         III.6 Adjustments.

                  (a) Exercise of Corporate Powers. The existence of this Plan
         and any outstanding Stock Units credited hereunder shall not affect in
         any manner the right or power of the Company or its stockholders to
         make or authorize any or all adjustments, recapitalizations,
         reorganizations or other changes in the capital stock of the Company or
         its business or any merger or consolidation of the Company, or any
         issue of bonds, debentures, preferred or prior preference stock
         (whether or not such issue is prior to, on a parity with or junior to
         the existing Common Stock) or the dissolution or liquidation of the
         Company, or any sale or transfer of all or any part of its assets or
         business, or any other corporate act or proceeding of any kind, whether
         or not of a character similar to that of the acts or proceedings
         enumerated above.

                  (b) Recapitalizations, Reorganizations and Other Activities.
         In the event of any subdivision or consolidation of outstanding shares
         of Common Stock, declaration of a dividend payable in shares of Common
         Stock or other stock split, then (i) the number of Stock Units relating
         to such Common Stock and (ii) the appropriate Fair Market Value and
         other price determinations for such Stock Units shall each be
         proportionately adjusted by the Board to reflect such transaction. In
         the event of any other recapitalization or capital reorganization of
         the Company, any consolidation or merger of the Company with another
         corporation or entity, the adoption by the Company of any plan of
         exchange affecting Common Stock or any distribution to holders of
         Common Stock of securities or property (other than normal cash
         dividends or dividends payable in Common Stock), the Board shall make
         appropriate adjustments to (i) the number of Stock Units relating to
         Common Stock and (ii) the appropriate Fair Market Value and other price
         determinations for Stock Units to give effect to such transaction;
         provided that such adjustments shall only be such as are necessary to
         preserve, without increasing, the value of such units. In the event of
         a corporate merger, consolidation, acquisition of property or stock,
         separation, reorganization or liquidation, the Board shall be
         authorized to issue or assume units by means of substitution of new
         units, as appropriate, for previously issued units or an assumption of
         previously issued units as part of such adjustment.

                                  IV. ARTICLE
                                    PAYMENTS

         IV.1 Period of Deferral. A Participant may elect that payment of
amounts credited to the Participant under the Plan be made or commence at (a) a
date that is five years following the date of the termination of the
Participant's status as a Director of the Company, or (b) the date of the
termination of the Participant's status as a Director of the Company (either of
such dates elected by the Participant to be known as the "Determination Date").
If alternative (a) is elected by the Participant, payment will be made or will
commence within 60 days after the date that is five years after termination of
the Participant's status as a Director of the Company. If alternative (b) is
elected by the Participant, payment will be made or will commence within 60 days
after termination of the Participant's status as a Director of the Company.
Notwithstanding

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the foregoing, except in the case of death or disability of a Director, no
amount may be distributed in respect of a Stock Unit awarded under the 1998
Incentive Plan until such Stock Unit has been held under this Plan for three
years.

         IV.2 Payment of Amounts in Deferred Interest Bearing Account. As of the
Determination Date, the sum of the amounts theretofore credited to a
Participant's Deferred Interest Bearing Account for each Deferred Compensation
Period plus all interest accrued thereon to, and including, the Determination
Date (the "Total Deferred Compensation Amount") shall be calculated. A
Participant shall receive payment of his Total Deferred Compensation Amount with
respect to each Deferred Compensation Period in the form he has previously
elected under Section IV.4.

         IV.3 Payment of Amounts in Stock Account. As of the Determination Date,
the aggregate Fair Market Value on the Valuation Date coinciding with or
immediately preceding the Determination Date of that number of Stock Units
credited to a Participant's Stock Account as of such Determination Date with
respect to each Deferred Compensation Period and with respect to each Award
under the 1998 Incentive Plan shall be calculated. The result is the "Total
Deferred Unit Amount." A Participant shall receive payment of his Total Deferred
Unit Amount with respect to each Deferred Compensation Period or 1998 Incentive
Plan Award in the form he has previously elected under Section IV.4.

         IV.4 Form of Payment. Payment to a Participant of amounts in his
Deferred Interest Bearing Account shall be made in the form of cash. Payment to
a Participant in respect of a Stock Unit in his Stock Account shall be made in
the form of Common Stock to which the unit relates; provided that under
conditions established by the Committee, a Participant may elect to receive an
amount payable in respect of a Stock Unit in the form of cash. Payment to a
Participant of amounts in both accounts shall be made by one of the following
methods: (a) a lump sum, (b) three substantially equal consecutive annual
installments, or (c) five substantially equal consecutive annual installments;
subject to the requirements of Section IV.1 hereof that no amount is
distributable in respect of a Stock Unit Award under the 1998 Incentive Plan
until it has been held for three years, except in the case of death or
disability of a Director. The Total Deferred Compensation Amount and the Total
Deferred Unit Amount that is to be distributed in cash shall bear interest from,
but excluding, the Determination Date to, and including, the date paid at the
Applicable Annual Rate as in effect from time to time, compounded monthly, and
the payment of each annual installment shall be accompanied by payment of the
amount of interest accrued thereon.

         IV.5 Death Prior to Payment. In the event that a Participant dies prior
to payment of all of the amounts payable pursuant to the Plan, any remaining
amounts together with all interest accrued thereon, shall be paid to the
Participant's designated Beneficiary in a lump sum within 60 days following the
Company's notification of the Participant's death. If no Beneficiary has been
designated, such payment shall be made to the Participant's estate. A
beneficiary designation, or revocation of a prior beneficiary designation, shall
be effective only if it is made in writing on a form provided by the Company,
signed by the Participant and received by the Committee. In the event that a
Participant dies prior to payment of all of the amounts

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payable pursuant to the Plan, and the designated Beneficiary dies prior to
payment of all the amounts payable pursuant to the Plan, payment shall be made
to the Participant's estate in a lump sum within 60 days of notification of the
Beneficiary's death.

         IV.6 Payments to Minors and Incompetents. Should the Participant become
incompetent or should the Participant designate a Beneficiary who is a minor or
incompetent, the Company shall be authorized to pay such funds to a parent or
guardian of such minor or incompetent, or directly to such minor or incompetent,
whichever manner the Committee shall determine in its sole discretion.

         IV.7 Change in Control. Participants may elect that upon a Change in
Control, the entire amounts payable under Sections IV.2 and IV.3 be made in a
lump sum payment within 60 days of the Change in Control.

                                   V. ARTICLE
                               ELECTING DEFERRALS

         V.1 Manner of Electing Deferral. Each election made by a Participant to
defer Cash Compensation under the Plan (i) shall take the form of a written
document (provided by the Company) signed by the Participant and filed with the
Committee, (ii) shall designate the Deferred Compensation Period for which such
deferral is elected, the account to which such deferral shall be credited, the
period of deferral and the form and manner of payment, (iii) shall only apply to
Cash Compensation payable after the date of such election and (iv) may not be
revoked or modified without the prior written approval of the Committee if the
proposed revocation or modification applies to amounts deferred with respect to
a Deferred Compensation Period which has already commenced at the time such
revocation or modification is proposed to be effected. With respect to each
award of Stock Units made to a Participant under the 1998 Incentive Plan, as
described in Section III.2(b) hereof, the Participant shall make an election
which (i) shall take the form of a written document (provided by the Company)
signed by the Participant and filed with the Committee, (ii) shall designate the
period of deferral and the form and manner of payment elected by the
Participant, and (iii) may not be revoked or modified without the prior written
approval of the Committee. The Committee shall be authorized to adopt such rules
and limitations as it shall determine are necessary or appropriate with respect
to the timing of elections to defer compensation under the Plan.

                                  VI. ARTICLE
                                  MISCELLANEOUS

         VI.1 Unfunded Plan. Nothing contained herein shall be deemed to create
a trust of any kind or create any fiduciary relationship. This Plan shall be
unfunded. Funds invested hereunder shall continue for all purposes to be part of
the general funds of the Company. To the extent that a Participant acquires a
right to receive payments from the Company under the Plan, such right shall not
be greater than the right of any unsecured general creditor of the Company and
such right shall be an unsecured claim against the general assets of the
Company. Although bookkeeping accounts may be established with respect to
Participants, any such accounts shall be used merely as a bookkeeping
convenience. The Company shall not be required to segregate any assets that may
at any time be represented by cash or rights thereto, nor shall this Plan be
construed as providing for such segregation, nor shall the Company, the Board or
the Committee

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be deemed to be a trustee of any cash or rights thereto to be granted under this
Plan. Any liability or obligation of the Company to any Participant with respect
to cash or rights thereto under this Plan shall be based solely upon any
contractual obligations that may be created by this Plan, and no such liability
or obligation of the Company shall be deemed to be secured by any pledge or
other encumbrance on any property of the Company. Neither the Company nor the
Board nor the Committee shall be required to give any security or bond for the
performance of any obligation that may be created by this Plan.

         VI.2 Title to Funds Remains with Company. Amounts credited to each
Participant's Deferred Interest Bearing Account and Stock Account shall not be
specifically set aside or other-wise segregated, but will be combined with
corporate assets. Title to such funds will remain with the Company and the
Company's only obligation will be to make timely payments to Participants in
accordance with the Plan.

         VI.3 Statement of Account. A statement will be furnished to each
Participant annually on such date as may be determined by the Committee stating
the balance of the Participant's Deferred Interest Bearing Account and Stock
Account and accrued interest thereon as of a recent date designated by the
Committee.

         VI.4 Assignability. Except as provided in Section IV.5, no right to
receive payment hereunder shall be transferable or assignable by a Participant
except by will or the laws of descent and distribution. In the event that a
Beneficiary designation under Section IV.5 conflicts with an assignment by will,
the Beneficiary designation will prevail. Any attempted assignment of any
benefit under this Plan in violation of this Section VI.4 shall be null and
void.

         VI.5 Amendment, Modification, Suspension or Termination. The Board may
amend, modify, suspend or terminate this Plan for the purpose of meeting or
addressing any changes in legal requirements or for any other purpose permitted
by law, except that no amendment, modification or termination shall, without the
consent of the Participant, impair the rights of any Participant to the balance
in such Participant's Deferred Interest Bearing Account or Stock Account or the
amount of interest accrued thereon as of the date of such amendment,
modification or termination. The Board may at any time and from time to time
delegate to the Committee any or all of this authority under this Section VI.5.

         VI.6 Governing Law. This Plan and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by mandatory
provisions of the Code or the securities laws of the United States, shall be
governed by and construed in accordance with the laws of the State of Delaware.

         VI.7 Effectiveness. The Plan, as approved by the Board for amendment
and restatement as set forth herein, shall be effective as set forth herein as
of the effective time of the Merger (October 8, 2001).

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                                                                    EXHIBIT 4.12

                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

               (AS AMENDED AND RESTATED EFFECTIVE OCTOBER 8, 2001)

                                    RECITALS

                  Conoco Inc. ("Conoco") established the Conoco Inc. 1998 Global
Performance Sharing Plan (the "Plan") effective October 16, 1998. Paragraph 5
specifies that awards may be granted under the Plan with respect to Conoco Class
A Common Stock. Paragraph 12 reserves to Conoco and the Committee the right to
amend the Plan. Paragraph 14 provides that Employee Awards may be assumed by
means of substitution of new Employee Awards in the event of certain corporate
transactions, including a reorganization.

                  Conoco intends to reclassify its Class A Common Stock and
Class B Common Stock into a single class of new common stock ("Common Stock") by
merging Conoco Delaware I, Inc., a wholly owned subsidiary of the Conoco
("Merger Sub"), with and into Conoco (the "Merger"), pursuant to an Agreement
and Plan of Merger, dated as of July 17, 2001, between the Company and Merger
Sub. In connection with the Merger and pursuant to their authority under
Paragraph 12, the Board has authorized this amendment and restatement of the
Plan to provide for the issuance of awards with respect to the new class of
Common Stock, such amendment and restatement to become effective upon the
effective time of the Merger (October 8, 2001). In addition, in connection with
the Merger and effective upon the effective time thereof, pursuant to Paragraph
14, a new Employee Award will be substituted for each previously issued
outstanding Employee Award. The new Employee Award will apply to a number of
shares of Common Stock equal to the total number of shares of Class A Common
Stock for which the previously issued outstanding Employee Award has not been
exercised, and shall provide for the same exercise price and the same other
terms and conditions as those applicable under the previously issued outstanding
Employee Award. In respect of Approved Stock Options granted under Addendum B
prior to the date of Merger, shares of Common Stock will be issued in lieu of
Class A Common Stock on exercise of the option and, for the avoidance of doubt,
a new Employee Award will not be substituted.

                  Now, therefore, Conoco hereby amends and restates the Plan,
effective as set forth in paragraph 20 hereof, to read as follows:

         1. Plan. The Plan was adopted by Conoco to provide certain employees of
Conoco with an option to purchase shares of common stock of Conoco.

         2. Purpose. The Plan is a broad-based, nonqualified stock option plan
designed to provide additional financial incentives for certain employees of
Conoco; to encourage a sense of proprietorship in such employees; to retain such
employees; and to stimulate the active interest of such employees in the
development and financial success of Conoco and its subsidiaries. These
objectives are accomplished by granting employees options to purchase Common
Stock and

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thereby providing the grantees with a proprietary interest in the growth and
performance of Conoco and its subsidiaries.

         3. Definitions and Construction. The provisions of this Plan are entire
and complete, except as may otherwise be set forth in any addendum attached
hereto and incorporated herein, intended to address particular legal, tax,
securities, or administrative requirements or restrictions in designated
Participating Countries. In any necessary construction of a provision of this
Plan, the masculine gender may include the feminine and or neuter, and the
singular may include the plural, and vice versa. This Plan should be construed
in a manner consistent with the intent of Conoco to establish a nonqualified
stock option plan subject to fixed accounting treatment. As used herein,
capitalized terms shall have the following respective meanings:

                  Applicable Exchange Rate means such exchange rate as from time
         to time determined by the Committee or its delegate in its discretion.

                  Beneficiary means the individual or trust defined by or
         designated as the Participant's Beneficiary in accordance with
         paragraph 15 hereof. If no Beneficiary is designated, then the
         Beneficiary shall be determined as prescribed by governing law.

                  Board means the Board of Directors of Conoco.

                  Cause means (i) the willful and continued failure by the
         Participant to substantially perform the Participant's duties with his
         or her employer (other than any such failure resulting from the
         Participant's incapacity due to physical or mental illness), or (ii)
         the willful engaging, not in good faith, by the Participant in conduct
         which is demonstrably injurious to Conoco or its subsidiaries,
         monetarily or otherwise.

                  Change of Control is defined in Attachment D.

                  Code means the U.S. Internal Revenue Code of 1986, as amended
         from time to time.

                  Committee means the Compensation Committee of the Board or
         such other committee of the Board as is designated by the Board to
         administer the Plan.

                  Common Stock means the Common Stock, par value $.01 per share,
         of Conoco.

                  Conoco means Conoco Inc. or any successors thereto.

                  Controlling Retirement Plan means the Retirement Plan of
         Conoco Inc., a defined benefit retirement plan sponsored by Conoco, or,
         if the Participant does not participate in the Retirement Plan of
         Conoco Inc., then such other retirement plan sponsored by a subsidiary
         in which the Participant is eligible to participate, or such other
         retirement plan or program acceptable to the Committee.

                  Divestiture means Conoco sells, transfers or otherwise divests
         of ownership of the subsidiary, department or division for which the
         Participant works, or of the assets

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<PAGE>   3

         associated with the Participant's employment, such that as a result of
         the sale, transfer or divestiture, the Participant is no longer an
         Employee.

                  Employee means any employee of a Participating Employer who is
         classified as a regular, full- or part-time employee, including such
         individuals who are regular, full- or part-time employees but who are
         on an approved paid leave of absence. Employee does not mean any
         individual who is not classified by a Participating Employer as a
         regular, full- or part-time employee, including temporary employees
         (whether full- or part-time), an employee on unpaid or unapproved leave
         of absence, casual workers and contract workers. Employees whose
         employment is the subject of collective bargaining shall not be
         considered Employees eligible to participate unless the terms of such
         bargaining agreement specifically provide for grants hereunder.
         Notwithstanding the foregoing, an individual who is not an "Employee"
         under this definition may nonetheless receive an Employee Award under
         this Plan if the Committee determines that governing law requires the
         individual to receive an Employee Award.

                  Employee Award means the right to purchase a specified number
         of shares of Common Stock at a specified price pursuant to such
         applicable terms, conditions and limitations as the Committee may
         establish in order to fulfill the objectives of this Plan which is
         granted by a Participating Employer to an Employee. An Employee Award
         may be an Initial Grant or a Subsequent Grant. All awards granted
         herein are nonqualified stock options except that an equivalent number
         of SARs shall be granted to Employees when applicable law makes the
         grant of options impractical, as determined by the Committee in its
         sole discretion.

                  Employee Award Agreement means a written statement setting
         forth the terms, conditions and limitations applicable to an Employee
         Award.

                  Fair Market Value of a share of Common Stock means, as of a
         particular date, (i) if shares of Common Stock are listed on a national
         securities exchange, the mean between the highest and lowest sales
         price per share of Common Stock on the consolidated transaction
         reporting system for the principal national securities exchange on
         which shares of Common Stock are listed on that date, or, if there
         shall have been no such sale so reported on that date, on the next
         succeeding date on which such a sale was so reported, or, at the
         discretion of the Committee, the price prevailing on the exchange at
         the time of exercise, (ii) if shares of Common Stock are not so listed
         but are quoted on the Nasdaq National Market, the mean between the
         highest and lowest sales price per share of Common Stock reported by
         the Nasdaq National Market on that date, or, if there shall have been
         no such sale so reported on that date, on the next succeeding date on
         which such a sale was so reported, or, at the discretion of the
         Committee, the price prevailing on the Nasdaq National Market at the
         time of exercise, (iii) if the Common Stock is not so listed or quoted,
         the mean between the closing bid and asked price on that date, or, if
         there are no quotations available for such date, on the next succeeding
         date on which such quotations shall be available, as reported by the
         Nasdaq Stock Market, or, if not reported by the Nasdaq Stock Market, by
         the National Quotation Bureau Incorporated or (iv) if shares of Common
         Stock are not publicly traded, the most recent value determined by an

                                      -3-
<PAGE>   4

         independent appraiser appointed by Conoco for such purpose; provided
         that, notwithstanding the foregoing, "Fair Market Value" in the case of
         any Employee Award granted in connection with the IPO, means the price
         per share of Common Stock set on the IPO Pricing Date, as set forth in
         the final prospectus relating to the IPO.

                  Grant Date means the particular date or dates, as established
         by the Committee, on which an Employee is granted an Employee Award
         under the terms of this Plan.

                  Grant Price means the Fair Market Value of Common Stock on the
         Grant Date.

                  Initial Grant means the Employee Awards granted under the Plan
         on the IPO Pricing Date.

                  IPO means the first time a registration statement filed under
         the Securities Act of 1933 and respecting an underwritten primary
         offering by Conoco of shares of Common Stock is declared effective
         under that Act and the shares registered by that registration statement
         are issued and sold by Conoco (otherwise than pursuant to the exercise
         of any overallotment option).

                  IPO Closing Date means the date on which Conoco first receives
         payment for the shares of Common Stock it sells in the IPO.

                  IPO Pricing Date means the date of the execution and delivery
         of an underwriting or other purchase agreement among Conoco and the
         underwriters relating to the IPO setting forth the price at which
         shares of Common Stock will be issued and sold by Conoco to the
         underwriters and the terms and conditions thereof.

                  Incentive Plan means the 1998 Stock Performance and Incentive
         Plan of Conoco Inc.

                  Participant means an individual to whom an Employee Award has
         been granted, and for whom such Employee Award remains outstanding,
         unforfeited, and unexercised under this Plan.

                  Participating Country means any country, as determined by the
         Committee in its sole and absolute discretion and as set forth in
         Attachment "A," as attached hereto, and as may be amended from time to
         time.

                  Participating Employer means Conoco, or any subsidiary or
         affiliate of Conoco, as determined by the Committee in its sole and
         absolute discretion, and as set forth in Attachment "B," as attached
         hereto, and as may be amended from time to time.

                  Plan means the Conoco Inc. 1998 Global Performance Sharing
         Plan, as set forth in this document, and as it may be amended from time
         to time.

                  Retirement means separation from employment as described under
         the Controlling Retirement Plan, or in the event the Participant does
         not participate in a Controlling

                                      -4-
<PAGE>   5

         Retirement Plan, then under the local governing law or Social Security
         authority, or such other plan as deemed acceptable by the Committee.
         The Employee must be eligible for an immediate retirement benefit under
         the Controlling Retirement Plan. This term includes retirements due to
         total and permanent disability (called incapacity retirements in the
         U.S.). Terminations where the individual is eligible for a future,
         rather than immediate, benefit are not considered Retirements under
         this Plan. In the U.S., separation retirements, as defined under the
         Conoco Inc. Retirement Plan, are not considered Retirements under this
         definition even if the Participant is eligible for an immediate
         benefit.

                  Severance means separation from employment under circumstances
         resulting from lack of work or outsourcing of the Employee's position
         or function.

                  Stock Appreciation Right or SAR means a right to receive a
         payment, in cash or in Common Stock, equal to the excess of the Fair
         Market Value of a specified number of shares of Common Stock on the
         date the right is exercised over the Fair Market Value of the specified
         number of shares of Common Stock on the date the SAR was granted.

                  Service Date means the date of record by which a Participating
         Employer establishes the service date of an Employee.

                  Subsequent Grant means any Employee Award granted under the
         terms of the Plan after the Grant Date of the Initial Grant.

                  Trading Day means a day on which Common Stock is available for
         purchase or sale on the New York Stock Exchange.

         4. Eligibility. Employees eligible for the Initial Grant are those
Employees of a Participating Employer in a Participating Country on the IPO
Pricing Date. Employees employed by a Participating Employer in a Participating
Country on the Grant Date of a Subsequent Grant shall be eligible for a
Subsequent Grant. Notwithstanding the foregoing, (a) Employees who on the
applicable Grant Date receive an award under the Incentive Plan shall not be
eligible to participate in this Plan; and (b) a Participating Employer may elect
to exclude specified groups of Employees from participation in the Initial Grant
or in Subsequent Grants.

         5. Common Stock Available for Employee Awards. Subject to the
provisions of paragraph 6 hereof, the Board has approved the granting of
1,900,000 shares of Common Stock under this Plan, which number of shares of
Common Stock may be modified from time to time by resolution of the Board. The
number of shares of Common Stock that are the subject of Employee Awards under
this Plan that are forfeited or terminated, that expire unexercised, or that are
settled in a manner such that all or some of the shares covered by an Employee
Award are not issued to a Participant, shall not be available for Employee
Awards hereunder. The Committee may from time to time adopt and observe such
procedures concerning the counting of shares against the Plan maximum as it may
deem appropriate. The Board and the appropriate officers of Conoco shall from
time to time take whatever actions are necessary to file any required

                                      -5-
<PAGE>   6

documents with governmental authorities, stock exchanges and transaction
reporting systems to ensure that shares of Common Stock are available for
issuance pursuant to Employee Awards.

         6. Employee Awards.

                  (a) Each Employee Award shall be described in an Employee
         Award Agreement, and shall be subject to the vesting schedule,
         forfeiture provisions, terms, conditions and limitations described
         herein. An Employee Award shall be subject to limitations on
         exercisability as are set forth in this Plan and in the Employee Award
         Agreement. Upon the termination of a Participant's employment, any
         unexercised, unvested or otherwise outstanding Employee Awards shall be
         treated as described herein and in the Employee Award Agreement.

                  (b) Each eligible Employee, as defined in paragraph 4, shall
         receive a grant of an Employee Award, as described in paragraph 6(c)
         hereof, in the amount, and subject to the terms, described in paragraph
         6(d) hereof.

                  (c) The price at which shares of Common Stock may be purchased
         upon the exercise of an Employee Award that is an option shall be the
         Grant Price. The exercise price of Employee Awards that are SARs shall
         be the Grant Price. All Employee Awards granted pursuant to this Plan
         shall be subject to the vesting schedule, forfeiture provisions, terms,
         conditions and limitations set forth in this Plan. The date or dates
         upon which an Employee Award awarded pursuant to this Plan may become
         exercisable shall be determined pursuant to subparagraphs 6(d)(ii),
         6(d)(iii) and 7(b) hereof.

                  (d) The following provisions shall apply to any Employee
         Awards made pursuant to this Plan:

                           (i) Amount and Term. Each eligible Participant on the
                  IPO Pricing Date shall receive an Initial Grant under this
                  Plan for the number of shares of Common Stock indicated on
                  Attachment C as applicable to the Participant. Each Initial
                  Grant shall have a term of 10 years. Subsequent Grants shall
                  be made to those eligible Participants as may be determined by
                  the Committee and in amounts, and subject to such terms and
                  conditions that the Committee shall establish.

                           (ii) Vesting and Exercisability of Employee Award.

                                    A. Employee Awards shall become vested on
                           the first anniversary of the applicable Grant Date,
                           and shall become exercisable (subject to
                           subparagraphs 6(d)(iii) and 7(b) hereof) in one-third
                           (1/3) increments cumulatively on the first, second
                           and third anniversaries of the applicable Grant Date,
                           if the Participant remains in the continuous
                           employment of a Participating Employer until such
                           date.

                                    B. Employee Awards shall be considered
                           vested six months after the applicable Grant Date,
                           and shall become fully exercisable (subject to

                                      -6-
<PAGE>   7

                           subparagraph 6(d)(iii) and 7(b) hereof), if the
                           Participant remains in the continuous employment of a
                           Participating Employer until death, Severance, or
                           Divestiture, and shall remain exercisable until the
                           earlier of (1) the expiration of two years from the
                           death, Severance or Divestiture, or (2) the
                           expiration of the term of the option.

                                    C. If the Participant terminates employment
                           with the Participating Employer by reason of
                           Retirement, then the Employee Award shall be
                           considered vested six months after the applicable
                           Grant date, and shall continue to become exercisable
                           pursuant to subparagraphs 6(d)(ii)(A) and 6(d)(ii)(B)
                           hereof, as if the Participant remained in the
                           continuous employment of the Participating Employer
                           and shall remain exercisable until the expiration of
                           the term of the option.

                                    D. In the event of a Change of Control
                           during the Participant's employment with the
                           Participating Employer, then the Employee Award shall
                           be become immediately vested and fully exercisable,
                           and shall remain exercisable until the expiration of
                           the term of the Option or, if the Participant should
                           die before the expiration of the term of the Option,
                           until the earlier of (i) the expiration of the term
                           of the Option or (ii) two (2) years from the date of
                           the Participant's death.

                                    E. If an Employee Award is not vested as of
                           the date the Participant terminates employment with
                           the Participating Employer, and does not become
                           vested on termination pursuant to subparagraph
                           6(d)(ii)(D), then the Employee Award shall be
                           forfeited upon the Participant's termination of
                           employment with the Participating Employer. If the
                           Participant's employment with a Participating
                           Employer terminates for Cause, then the Employee
                           Award shall be forfeited upon the Participant's
                           termination of employment with the Participating
                           Employer. If the Participant terminates employment
                           with a Participating Employer under circumstances
                           other than pursuant to those listed in subparagraphs
                           6(d)(ii)(B), (C), or (D), and the Participant is not
                           terminated for Cause, then the Employee Award shall
                           remain exercisable, to the extent exercisable as of
                           the date of termination, for a period of ninety days
                           after the date of termination.

                           (iii) Lapse of Employee Award. Employee Award shall
                  cease to be exercisable as to any share when the Participant
                  purchases the share, or when the Employee Award lapses as
                  provided in this subparagraph. A Participant shall have no
                  obligation to exercise an Employee Award granted pursuant to
                  this Plan. Employee Awards shall lapse on the earlier of (A)
                  the tenth anniversary of the Grant Date or (B) the applicable
                  period specified in Section 6(d)(ii). Any Employee Award
                  granted pursuant to this Plan which has not been exercised
                  prior to such lapse date shall be automatically forfeited.

                                      -7-
<PAGE>   8

         7. Election to Exercise.

                  (a) Election. An exercisable Employee Award may be exercised
         (subject to subparagraphs 6(d)(ii), 6(d)(iii), and 7(b) hereof), in
         whole or in part, by timely notice to the Committee, in such form as
         may be designated by the Committee, of exercise, and payment of the
         purchase price, if the Employee Award is an option. Notice of exercise
         shall be effective on the date both the notice and the purchase price
         are received by the Committee. The notice must state the Participant's
         election to exercise the Employee Award, the number of shares with
         respect to which the election to exercise has been made, if applicable,
         the method of payment elected, the exact name or names in which such
         shares will be registered and such other information and in such form
         as may be required by the Committee. In the event of the death of a
         Participant, the Employee Award may be exercised by the Beneficiary of
         the Participant, subject to the provisions hereof.

                  (b) Completion of Necessary Forms. As a condition precedent to
         becoming eligible to exercise any Employee Award, the Participant shall
         be required to complete and execute such forms as may be designated by
         the Committee. Failure to properly complete and execute such forms
         shall result in the lapse of a vested Employee Award pursuant to the
         provisions of subparagraph 6(d)(iii) hereof.

                  (c) Payment. The full purchase price for the shares of Common
         Stock purchased on the exercise of an Employee Award that is an option
         (i.e., the number of shares purchased, multiplied by the price per
         share) may be paid in cash, or, at the request of the Participant, and
         to the extent permitted by applicable law, the Committee may approve,
         in its sole and absolute discretion, tender of shares of Common Stock,
         or cashless exercise through an arrangement with a brokerage firm,
         under which the brokerage firm, on behalf of the Participant, will pay
         for all or a portion of the shares of Common Stock purchased upon the
         exercise of the Employee Award.

                  (d) Minimum Exercise. The minimum number of shares with
         respect to which an Employee Award may be exercised shall be the lesser
         of (i) ten shares or (ii) the number of shares with respect to which
         the Employee Award is currently exercisable.

                  (e) Cash-out of Awards. At the discretion of the Committee, an
         Employee Award may be settled by a cash payment equal to the difference
         between the Fair Market Value per share of Common Stock on the date of
         exercise and the Grant Price of the Employee Award, multiplied by the
         number of shares with respect to which the Employee Award is exercised.

         8. Administration.

                  (a) This Plan shall be administered by the Committee (or the
         Committee's delegate pursuant to paragraph 9 hereof). The Committee
         shall have the power, in its sole and absolute discretion, to contract
         with a third-party administrator to administer this Plan.

                                      -8-
<PAGE>   9

                  (b) Subject to the provisions hereof, the Committee shall have
         full and exclusive power and authority to administer this Plan and to
         take all actions which are specifically contemplated hereby or are
         necessary or appropriate in connection with the administration hereof.
         The Committee shall also have full and exclusive power to interpret
         this Plan, to devise necessary forms and documents, and to adopt such
         rules, regulations and guidelines for carrying out this Plan as it may
         deem necessary or proper, all of which powers shall be exercised in the
         best interests of Conoco and in keeping with the objectives of this
         Plan. The Committee may, in its sole and absolute discretion, amend or
         modify an Employee Award in any manner that is consistent with the
         purpose and objectives of this Plan and is either (i) not adverse to
         the Participant to whom such Employee Award was granted, (ii) required
         to comply with governing law, or (iii) consented to by such
         Participant. The Committee may correct any defect or supply any
         omission or reconcile any error or inconsistency in this Plan or in any
         Employee Award Statement in the manner and to the extent the Committee
         deems necessary or desirable to carry it into effect. Any decision of
         the Committee in the interpretation and administration of this Plan
         shall lie within its sole and absolute discretion and shall be final,
         conclusive and binding on all parties concerned.

                  (c) No member of the Committee, or officer or Employee of
         Conoco to whom the Committee has delegated authority in accordance with
         the provisions of paragraph 9 hereof, shall be liable for anything done
         or omitted to be done by such person, by any member of the Committee,
         or by any officer or Employee of Conoco in connection with the
         performance of any duties under this Plan, except for such person's own
         willful misconduct or as expressly provided by statute.

         9. Delegation of Authority. The Committee may delegate to such
subcommittees, officers, other Employees of Conoco, or qualified third-party
administrators, its duties under this Plan pursuant to such conditions or
limitations as the Committee may establish. The Committee shall have the power
and authority to appoint, remove or replace the members of any such
subcommittee, or any officer, Employee or third-party administrator that has
been delegated responsibilities and authority by the Committee.

         10. Tax Withholding. Upon the exercise of an Employee Award, or any
part thereof, the Participant may incur certain liabilities for taxes and the
Participating Employer may be required by law to withhold such taxes for payment
to taxing authorities. Upon determination by the Participating Employer of the
amount of taxes required to be withheld, including taxes, if any, which may be
required to be withheld prior to exercise with respect to the shares to be
issued pursuant to the exercise of the Employee Award, the Committee shall
establish procedures which allow the Participant (a) to direct the Participating
Employer to withhold from the Common Stock available for exercise the number of
shares necessary to satisfy the withholding obligations, based on the Fair
Market Value of Common Stock on the date of withholding; (b) to deliver
sufficient cash to the Participating Employer to satisfy its withholding
obligations; or (c) some combination thereof. Authorization of the Participant
to the Participating Employer to withhold taxes must be in a form and content
acceptable to the Committee. Failure by the Participant to comply with the
foregoing shall entitle the Committee, in its sole and absolute discretion, to
authorize the sale of a sufficient number of the shares of Common Stock which
the

                                      -9-
<PAGE>   10

Participant is entitled to receive upon the exercise of the Participant's
Employee Award in order to satisfy such withholding requirements; provided,
however, that neither the Participating Employer nor the Committee shall be
liable for determining the exact amount of such taxes, for selling shares of
Common Stock in excess of that required to satisfy such tax obligation, or for
obtaining the highest sales price for any such shares. The payment or
authorization to withhold taxes by the Participant shall be completed prior to
the delivery of any Common Stock pursuant to this Plan. An authorization to
withhold taxes pursuant to this provision will be irrevocable unless and until
the tax liability of the Participant has been fully paid.

         11. Delivery of Shares. Subject to paragraphs 11 and 16 hereof, and
upon written request of the Participant, the Participating Employer shall cause
certificates for those shares of Common Stock which the Participant is entitled
to receive upon the exercise of an Employee Award to be delivered to
Participant. Notwithstanding the foregoing, no shares of Common Stock shall be
delivered to the Participant upon the exercise of the Employee Award until (a)
the purchase price, including any applicable fees or commissions, has been paid
in full in the manner herein provided; (b) all the applicable taxes required to
be withheld have been paid or withheld in full; and (c) the approval of any
governmental authority required in connection with the Employee Award or the
issuance of shares thereunder has been received by Conoco.

         12. Amendment, Modification, Suspension or Termination. Conoco may
amend, modify, suspend or terminate this Plan for the purpose of meeting or
addressing any changes in legal requirements or for any other purpose permitted
by law, except that (a) no amendment or alteration that would adversely affect
the rights of any Participant under any Employee Award previously granted to
such Participant shall be made without the consent of such Participant and (b)
no amendment or alteration shall be effective prior to approval by the
stockholders of Conoco to the extent stockholder approval is required by
applicable legal requirements. Subject to the same conditions listed in the
previous sentence, the Committee may amend the terms of Addendum A and Addendum
B without any action of the Board. Conoco may, in its sole and absolute
discretion, terminate this Plan at any time, provided that such termination
shall not cause any Participant to lose any rights to any vested Employee Award.

         13. Assignability. No Employee Award or any other benefit under this
Plan shall be assignable or otherwise transferable except by will, Beneficiary
designation or the laws of descent and distribution. In the event that a
Beneficiary designation conflicts with an assignment by will, the Beneficiary
designation will prevail. The Committee may prescribe other restrictions on
transfer. Any attempted assignment of an Employee Award or any other benefit
under this Plan in violation of this paragraph 13 shall be null and void.

         14. Adjustments.

                  (a) The existence of outstanding Employee Awards shall not
         affect in any manner the right or power of Conoco or its stockholders
         to make or authorize any or all adjustments, recapitalizations,
         reorganizations or other changes in the capital stock of Conoco or its
         business or any merger or consolidation of Conoco, or any issue of
         bonds, debentures, preferred or prior preference stock (whether or not
         such issue is prior to, on a parity with or junior to the Common Stock)
         or the dissolution or liquidation of Conoco or

                                      -10-
<PAGE>   11

         a subsidiary, or any sale or transfer of all or any part of its assets
         or business, or any other corporate act or proceeding of any kind,
         whether or not of a character similar to that of the acts or
         proceedings enumerated above.

                  (b) In the event of any subdivision or consolidation of
         outstanding shares of Common Stock, declaration of a dividend payable
         in shares of Common Stock, or other stock split, then (i) the number of
         shares of Common Stock reserved under this Plan, (ii) the number of
         shares of Common Stock covered by outstanding Employee Awards, (iii)
         the exercise or other price in respect of such Employee Awards, and
         (iv) the appropriate Fair Market Value and other price determinations
         for such Employee Awards, shall be proportionately adjusted by the
         Committee as appropriate to reflect such transaction. In the event of
         any other recapitalization or capital reorganization of Conoco, any
         consolidation or merger of Conoco with another corporation or entity,
         the adoption by Conoco of any plan of exchange affecting the Common
         Stock or any distribution to holders of Common Stock of securities or
         property (other than normal cash dividends or dividends payable in
         Common Stock), then (i) the number of shares of Common Stock covered by
         Employee Awards in the form of options on Common Stock, (ii) the
         exercise or other price in respect of such Employee Awards, and (iii)
         the appropriate Fair Market Value and other price determinations for
         such Employee Awards, shall be proportionately adjusted by the
         Committee to reflect such transaction; provided that such adjustments
         shall only be such as are necessary to maintain the proportionate
         interest of the holders of the Employee Awards and preserve, without
         exceeding, the value of such Employee Awards. In the event of a
         corporate merger, consolidation, acquisition of property or stock,
         separation, reorganization or liquidation, the Committee shall be
         authorized to issue or assume Employee Awards by means of substitution
         of new Employee Awards, as appropriate, for previously issued Employee
         Awards or an assumption of previously issued Employee Awards as part of
         such adjustment.

         15. Beneficiary Designation. Beneficiaries shall be designated in such
manner and according to such requirements as may be designated by the Committee.
The designation of a Beneficiary shall be effective on the date received by the
Committee. Upon the death of a Participant, a Beneficiary shall be entitled to
exercise a vested Employee Award pursuant to the provisions of paragraph 6
hereof.

         16. Restrictions. No Common Stock or other form of payment shall be
issued with respect to any Employee Award unless the Participating Employer
shall be satisfied based on the advice of its counsel that such issuance will be
in compliance with applicable laws, rules or regulations. Certificates
evidencing shares of Common Stock certificates delivered under this Plan (to the
extent that such shares are so evidenced) may be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable in order to
satisfy the rules, regulations, agreements or other requirements of the U.S.
Securities and Exchange Commission, or any securities exchange or transaction
reporting system upon which the Common Stock is then listed or to which it is
admitted for quotation, and any applicable securities law. The Committee may
cause a legend or legends to be placed upon such certificates (if any) to make
appropriate reference to such restrictions.

                                      -11-
<PAGE>   12

         17. Unfunded Plan. This Plan shall be unfunded. Although bookkeeping
accounts may be established with respect to Participants who are entitled to
Common Stock or rights thereto under this Plan, any such accounts shall be used
merely as a bookkeeping convenience. Conoco shall not be required to segregate
any assets that may at any time be represented by Common Stock or rights
thereto, nor shall this Plan be construed as providing for such segregation, nor
shall Conoco, the Board or the Committee be deemed to be a trustee of any Common
Stock or rights thereto to be granted under this Plan. Any liability or
obligation of Conoco to any Participant with respect to rights granted under
this Plan shall be based solely upon any contractual obligations that may be
created by this Plan and any Employee Award Statement, and no such liability or
obligation of Conoco shall be deemed to be secured by any pledge or other
encumbrance on any property of Conoco. Neither Conoco, any subsidiary, the Board
nor the Committee shall be required to give any security or bond for the
performance of any obligation that may be created by this Plan.

         18. Governing Law. This Plan and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by mandatory
provisions of the Code or the securities laws of the United States, shall be
governed by and construed in accordance with the laws of the State of Delaware
without regard to any conflicts of law principles that would compel the
application of any other law.

         19. No Right to Employment. Nothing in this Plan or in any Employee
Award issued pursuant to this Plan shall confer upon any Participant any right
to receive another Employee Award or to continue in the employ of the
Participating Employer or affect the Participating Employer's right, subject to
applicable law, to terminate the employment of any Participant at any time, with
or without cause.

         20. Effectiveness. The Plan was established effective October 16, 1998
and approved by the stockholders of Conoco on October 19, 1998. The Plan, as
approved by the Board for amendment and restatement as set forth herein, shall
be effective as set forth herein as of the effective time of the Merger (October
8, 2001).

                                      -12-
<PAGE>   13

                                 ATTACHMENT "A"
                                       TO
                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

<Table>
<Caption>
                               PARTICIPATING COUNTRIES
                               -----------------------
<S>                                                          <C>
               Australia                                     Mexico

               Austria                                       Netherlands

               Belgium                                       Nigeria

               Canada                                        Norway

               Colombia                                      Poland

               Czech Republic                                Russia

               Denmark                                       Singapore

               Dubai                                         Slovakia

               Finland                                       Spain

               Germany                                       Sweden

               Hungary                                       Thailand

               India                                         Turkey

               Indonesia                                     United Kingdom

               Japan                                         United States

               Malaysia                                      Venezuela

                            Total No. of Countries: 30
                            --------------------------
</Table>

                                 Attachment A-1
<PAGE>   14

                                 ATTACHMENT "B"
                                       TO
                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

                             PARTICIPATING EMPLOYERS
                  (as of the Grant Date for the Initial Grant)

CONOCO INC., A DELAWARE CORPORATION,
AND
EACH OF THE FOLLOWING:

           SARs
--------------------------------------------------------------------------------
Conoco Czech Republic s.r.o.
Conoco Danmark A/S
Conoco Middle East Limited
Conoco Finland OY
Conoco Hungary Kft.
Conoco Asia Ltd.
Conoco Indonesia Inc.
Conoco Asia Pacific Sdn Bhd
Projet Malaysia Sdn Bhd
Conoco Jet Malaysia SDN BHD
DuPont Services BV
Conoco Energy Nigeria Ltd.
Norske Conoco AS
Conoco Norge AS
Conoco Poland Sp. z.o.o.
Conoco International Petroleum Co. (CIPC)
Conoco Slovakia s.r.o.
Conoco Nordic AB
Conoco Thailand Ltd.

                                 Attachment B-1
<PAGE>   15

                                  Stock Options
--------------------------------------------------------------------------------
Conoco Operations (Qld) Pty Ltd.
Conoco Austria Mineraloel GMBH
Societe Eurapeene Des Carburants (SECA)
Conoco Canada Ltd.
Conoco Colombia Ltd.
Conoco Mineraloel GMBH
Conoco Petcoke Far East Ltd.
Conoco Mexico Servicios, S.A. de C.V.
Conoco International Inc.
Conoco Shipping Company (Spain)
Conoco EurAsia Inc.
Conoco Limited
Conoco (UK) Ltd.
Conoco Inc (Parent Company)
Conoco Pipeline Ltd.
Enertech N.V.
Louisiana Gas Systems Inc.
Kayo
Conoco Venezuela Ltd.

                                 Attachment C-1
<PAGE>   16

                                 ATTACHMENT "C"
                                       TO
                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

         For All Participating Countries    Amount subject to Employee Award for
                                            Initial Grants is one hundred fifty
                                            (150) shares of Common Stock

                                 Attachment C-0
<PAGE>   17

                                 ATTACHMENT "D"

1. "CHANGE IN CONTROL"

                  The following definitions apply to the Change of Control
provision in Section 6(d)(ii)(D) of the foregoing Plan.

                  "Affiliate" shall have the meaning ascribed to such term in
Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in
effect on October 1, 2000.

                  "Associate" shall mean, with reference to any Person, (a) any
corporation, firm, partnership, association, unincorporated organization or
other entity (other than the Company or a subsidiary of the Company) of which
such Person is an officer or general partner (or officer or general partner of a
general partner) or is, directly or indirectly, the Beneficial Owner of 10% or
more of any class of equity securities, (b) any trust or other estate in which
such Person has a substantial beneficial interest or as to which such Person
serves as trustee or in a similar fiduciary capacity and (c) any relative or
spouse of such Person, or any relative of such spouse, who has the same home as
such Person.

                  "Beneficial Owner" shall mean, with reference to any
securities, any Person if:

                  (a) such Person or any of such Person's Affiliates and
         Associates, directly or indirectly, is the "beneficial owner" of (as
         determined pursuant to Rule 13d-3 of the General Rules and Regulations
         under the Exchange Act, as in effect on October 1, 2000) such
         securities or otherwise has the right to vote or dispose of such
         securities, including pursuant to any agreement, arrangement or
         understanding (whether or not in writing); provided, however, that a
         Person shall not be deemed the "Beneficial Owner" of, or to
         "beneficially own," any security under this subsection (a) as a result
         of an agreement, arrangement or understanding to vote such security if
         such agreement, arrangement or understanding: (i) arises solely from a
         revocable proxy or consent given in response to a public (i.e., not
         including a solicitation exempted by Rule 14a-2(b)(2) of the General
         Rules and Regulations under the Exchange Act) proxy or consent
         solicitation made pursuant to, and in accordance with, the applicable
         provisions of the General Rules and Regulations under the Exchange Act
         and (ii) is not then reportable by such Person on Schedule 13D under
         the Exchange Act (or any comparable or successor report);

                  (b) such Person or any of such Person's Affiliates and
         Associates, directly or indirectly, has the right or obligation to
         acquire such securities (whether such right or obligation is
         exercisable or effective immediately or only after the passage of time
         or the occurrence of an event) pursuant to any agreement, arrangement
         or understanding (whether or not in writing) or upon the exercise of
         conversion rights, exchange rights, other rights, warrants or options,
         or otherwise; provided, however, that a Person shall not be deemed the
         Beneficial Owner of, or to "beneficially own," (i) securities tendered
         pursuant to a tender or exchange offer made by such Person or any of
         such Person's Affiliates or Associates until such tendered securities
         are accepted for purchase or exchange or (ii) securities issuable upon
         exercise of Exempt Rights; or

                                 Attachment D-1
<PAGE>   18

                  (c) such Person or any of such Person's Affiliates or
         Associates (i) has any agreement, arrangement or understanding (whether
         or not in writing) with any other Person (or any Affiliate or Associate
         thereof) that beneficially owns such securities for the purpose of
         acquiring, holding, voting (except as set forth in the proviso to
         subsection (a) of this definition) or disposing of such securities or
         (ii) is a member of a group (as that term is used in Rule 13d-5(b) of
         the General Rules and Regulations under the Exchange Act) that includes
         any other Person that beneficially owns such securities;

provided, however, that nothing in this definition shall cause a Person engaged
in business as an underwriter of securities to be the Beneficial Owner of, or to
"beneficially own," any securities acquired through such Person's participation
in good faith in a firm commitment underwriting until the expiration of 40 days
after the date of such acquisition. For purposes hereof, "voting" a security
shall include voting, granting a proxy, consenting or making a request or demand
relating to corporate action (including, without limitation, a demand for a
stockholder list, to call a stockholder meeting or to inspect corporate books
and records) or otherwise giving an authorization (within the meaning of Section
14(a) of the Exchange Act) in respect of such security.

                  The terms "beneficially own" and "beneficially owning" shall
have meanings that are correlative to this definition of the term "Beneficial
Owner."

                  "Change of Control" shall mean any of the following occurring
on or after October 19, 2000:

                  (a) any Person (other than an Exempt Person) shall become the
         Beneficial Owner of 20% or more of the shares of Common Stock then
         outstanding or 20% or more of the combined voting power of the Voting
         Stock of the Company then outstanding; provided, however, that no
         Change of Control shall be deemed to occur for purposes of this
         subsection (a) if such Person shall become a Beneficial Owner of 20% or
         more of the shares of Common Stock or 20% or more of the combined
         voting power of the Voting Stock of the Company solely as a result of
         (i) an Exempt Transaction or (ii) an acquisition by a Person pursuant
         to a reorganization, merger or consolidation, if, following such
         reorganization, merger or consolidation, the conditions described in
         clauses (i), (ii) and (iii) of subsection (c) of this definition are
         satisfied;

                  (b) individuals who, as of October 19, 2000, constitute the
         Board (the "Incumbent Board") cease for any reason to constitute at
         least a majority of the Board; provided, however, that any individual
         becoming a director subsequent to October 1, 2000 whose election, or
         nomination for election by the Company's shareholders, was approved by
         a vote of at least a majority of the directors then comprising the
         Incumbent Board shall be considered as though such individual were a
         member of the Incumbent Board; provided, further, that there shall be
         excluded, for this purpose, any such individual whose initial
         assumption of office occurs as a result of any actual or threatened
         election contest that is subject to the provisions of Rule 14a-11 of
         the General Rules and Regulations under the Exchange Act;

                                 Attachment D-2
<PAGE>   19

                  (c) the shareholders of the Company shall approve a
         reorganization, merger or consolidation, in each case, unless,
         following such reorganization, merger or consolidation, (i) more than
         70% of the then outstanding shares of common stock of the corporation
         resulting from such reorganization, merger or consolidation and the
         combined voting power of the then outstanding Voting Stock of such
         corporation beneficially owned, directly or indirectly, by all or
         substantially all of the Persons who were the Beneficial Owners of the
         outstanding Common Stock immediately prior to such reorganization,
         merger or consolidation in substantially the same proportions as their
         ownership, immediately prior to such reorganization, merger or
         consolidation, of the outstanding Common Stock, (ii) no Person
         (excluding any Exempt Person or any Person beneficially owning,
         immediately prior to such reorganization, merger or consolidation,
         directly or indirectly, 20% or more of the Common Stock then
         outstanding or 20% or more of the combined voting power of the Voting
         Stock of the Company then outstanding) beneficially owns, directly or
         indirectly, 20% or more of the then outstanding shares of common stock
         of the corporation resulting from such reorganization, merger or
         consolidation or the combined voting power of the then outstanding
         Voting Stock of such corporation and (iii) at least a majority of the
         members of the board of directors of the corporation resulting from
         such reorganization, merger or consolidation were members of the
         Incumbent Board at the time of the execution of the initial agreement
         or initial action by the Board providing for such reorganization,
         merger or consolidation; or

                  (d) the shareholders of the Company shall approve (i) a
         complete liquidation or dissolution of the Company unless such
         liquidation or dissolution is approved as part of a plan of liquidation
         and dissolution involving a sale or disposition of all or substantially
         all of the assets of the Company to a corporation with respect to
         which, following such sale or other disposition, all of the
         requirements of clauses (ii)(A), (B) and (C) of this subsection (d) are
         satisfied, or (ii) the sale or other disposition of all or
         substantially all of the assets of the Company, other than to a
         corporation, with respect to which, following such sale or other
         disposition, (A) more than 70% of the then outstanding shares of common
         stock of such corporation and the combined voting power of the Voting
         Stock of such corporation is then beneficially owned, directly or
         indirectly, by all or substantially all of the Persons who were the
         Beneficial Owners of the outstanding Common Stock immediately prior to
         such sale or other disposition in substantially the same proportion as
         their ownership, immediately prior to such sale or other disposition,
         of the outstanding Common Stock, (B) no Person (excluding any Exempt
         Person and any Person beneficially owning, immediately prior to such
         sale or other disposition, directly or indirectly, 20% or more of the
         Common Stock then outstanding or 20% or more of the combined voting
         power of the Voting Stock of the Company then outstanding) beneficially
         owns, directly or indirectly, 20% or more of the then outstanding
         shares of common stock of such corporation and the combined voting
         power of the then outstanding Voting Stock of such corporation and (C)
         at least a majority of the members of the board of directors of such
         corporation were members of the Incumbent Board at the time of the
         execution of the initial agreement or initial action of the Board
         providing for such sale or other disposition of assets of the Company.

                                 Attachment D-3
<PAGE>   20

                  "Common Stock" shall have the meaning set forth in the
foregoing Plan.

                  "Company" shall mean Conoco Inc., formerly Conoco Energy
Company, a Delaware corporation.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.

                  "Exempt Person" shall mean any of the Company, any subsidiary
of the Company, any employee benefit plan of the Company or any subsidiary of
the Company, and any Person organized, appointed or established by the Company
for or pursuant to the terms of any such plan.

                  "Exempt Rights" shall mean any rights to purchase shares of
Common Stock or other Voting Stock of the Company if at the time of the issuance
thereof such rights are not separable from such Common Stock or other Voting
Stock (i.e., are not transferable otherwise than in connection with a transfer
of the underlying Common Stock or other Voting Stock), except upon the
occurrence of a contingency, whether such rights exist as of October 1, 2000 or
are thereafter issued by the Company as a dividend on shares of Common Stock or
other Voting Securities or otherwise.

                  "Exempt Transaction" shall mean an increase in the percentage
of the outstanding shares of Common Stock or the percentage of the combined
voting power of the outstanding Voting Stock of the Company beneficially owned
by any Person solely as a result of a reduction in the number of shares of
Common Stock then outstanding due to the repurchase of Common Stock or Voting
Stock by the Company, unless and until such time as (a) such Person or any
Affiliate or Associate of such Person shall purchase or otherwise become the
Beneficial Owner of additional shares of Common Stock constituting 1% or more of
the then outstanding shares of Common Stock or additional Voting Stock
representing 1% or more of the combined voting power of the then outstanding
Voting Stock, or (b) any other Person (or Persons) who is (or collectively are)
the Beneficial Owner of shares of Common Stock constituting 1% or more of the
then outstanding shares of Common Stock or Voting Stock representing 1% or more
of the combined voting power of the then outstanding Voting Stock shall become
an Affiliate or Associate of such Person.

                  "Person" shall mean any individual, firm, corporation,
partnership, association, trust, unincorporated organization or other entity.

                  "Voting Stock" shall mean, with respect to a corporation, all
securities of such corporation of any class or series that are entitled to vote
generally in the election of directors of such corporation (excluding any class
or series that would be entitled so to vote by reason of the occurrence of any
contingency, so long as such contingency has not occurred).

                                 Attachment D-4
<PAGE>   21

                                  ADDENDUM "A"
                                       TO
                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

The following are provisions, in addition to those provisions in the Plan, which
are applicable to Employees in the respective Participating Countries listed
below. As used herein, capitalized terms shall have the respective meanings
ascribed to such terms in the Plan.

1.       AUSTRIA. This Plan is revocable at any time and is a freely offered
         benefit by the Participating Employer and is not subject to any legal
         claim as to termination indemnities or severance payments.

2.       CANADA. There are no additional rights accruing to an eligible Employee
         as a result of this Plan and the Participating Employees right to
         terminate an eligible Employee is not deemed to have been prejudiced as
         a result of the offering and/or implementation of the Plan.

3.       GERMANY. This Plan is revocable at any time and is a freely offered
         benefit by the Participating Employer and is not subject to any legal
         claim as to termination indemnities or severance payments.

4.       MEXICO. This Plan may be used to offset and/or compensate any future
         performance or profit sharing plans to be established by applicable law
         or by collective agreement.

                                  Addendum A-1
<PAGE>   22

                                  ADDENDUM "B"
                                       TO
                                   CONOCO INC.
                      1998 GLOBAL PERFORMANCE SHARING PLAN

                                   CONOCO INC.
                           1998 UK STOCK OPTION SCHEME

1.       DEFINITIONS AND INTERPRETATION

         (1)      Unless the context otherwise requires, all expressions defined
                  in the US Plan shall have the same meaning in the UK Scheme,
                  save that:

                  "Fair Market Value" has the meaning set forth in sub-rule
                  5(3);

                  "Option" includes an Approved Stock Option as defined in
                  sub-rule 1(2).

         (2)      In addition, the following expressions shall have the
                  following meanings in the UK Scheme unless the context
                  otherwise requires:

                  "Approved Stock Option" means an Option granted in accordance
                  with the UK Scheme;

                  "Company" means Conoco Inc.;

                  "Grant Date" in relation to an option means the date on which
                  the option was granted;

                  "the Inland Revenue" means the United Kingdom's Commissioners
                  of Inland Revenue;

                  "Participating Company" means the Company or a Subsidiary of
                  the Company;

                  "Schedule 9" means Schedule 9 to the Taxes Act;

                  "Subsidiary" shall mean a body corporate, whether now or
                  hereafter existing, which is:

                  (a)      a subsidiary of the Company within the meaning of
                           Section 736 of the United Kingdom Companies Act 1985;
                           and is

                  (b)      under the control of the Company within the meaning
                           of Section 840 of the Taxes Act.

                                  Addendum B-1
<PAGE>   23

                  "the Taxes Act" means the United Kingdom's Income and
                  Corporation Taxes Act 1988;

                  "the Terms and Conditions" mean terms and conditions specified
                  in the Conoco Inc. 1998 Global Performance Sharing Plan
                  Employee Award Agreement;

                  "the UK Scheme" means the Conoco Inc. 1998 UK Stock Option
                  Scheme as herein set out but subject to any alterations or
                  additions made under Rule 8 below; and

                  "the US Plan" means the 1998 Conoco Inc. Global Performance
                  Sharing Plan.

         (3)      Expressions not otherwise defined herein have the same meaning
                  as they have in Schedule 9.

         (4)      Any reference herein to any enactment includes a reference to
                  that enactment as from time to time modified, extended or
                  re-enacted.

2.       APPLICABILITY OF THE US PLAN AND THE TERMS AND CONDITIONS

         Save as hereinafter specified, all the term and provisions of the US
         Plan and the Terms and Conditions shall apply mutatis mutandis to the
         grant of Approved Stock Options under the UK Scheme.

3.       ELIGIBILITY

         (1)      Subject to sub-rule (3) below, a person is eligible to be
                  granted an Approved Stock Option if (and only if) he is a
                  full-time director or qualifying employee of a Participating
                  Company.

         (2)      For the purposes of sub-rule (1) above:

                  (a)      a person shall be treated as a full-time director of
                           a Participating Company if he is obliged to devote to
                           the performance of the duties of his or her office or
                           employment with that and any other Participating
                           Company not less than 25 hours a week (excluding meal
                           breaks);

                  (b)      a qualifying employee, in relation to a Participating
                           Company, is an employee of the Participating Company
                           (other than one who is a director of a Participating
                           Company).

         (3)      A person is not eligible to be granted an Option under the UK
                  Scheme at any time when he is not eligible to participate in
                  the UK Scheme by virtue of paragraph 8 of Schedule 9.

                                  Addendum B-2
<PAGE>   24

4.       GRANT OF OPTIONS

         (1)      Notwithstanding Paragraph 6(b) of the US Plan, the Approved
                  Stock Options to be issued as part of the Initial Grant shall
                  only be granted by action of the Board or such other persons
                  as are authorized by the Board on the IPO Pricing Date.
                  Subject to sub-rule (3) below, the Committee may grant to any
                  person who is eligible to be granted an Option under the UK
                  Scheme an Approved Stock Option to acquire Shares which
                  satisfy the requirements of paragraphs 10 to 14 of Schedule 9,
                  upon the terms set out in the UK Scheme and upon such other
                  objective terms as the Committee may reasonably specify.

         (2)      The grant of an Approved Stock Option shall be subject to
                  obtaining any approval or consent which may be required under
                  the provisions of any regulation or enactment.

         (3)      No person shall be granted Approved Stock Options under the UK
                  Scheme which would, at the time they are granted, cause the
                  aggregate market value of the Shares which he may acquire in
                  pursuance of options granted to him under the UK Scheme or
                  under any other share option scheme, not being a
                  savings-related share option scheme, approved under Schedule 9
                  and established by the Company or by any associated company of
                  the Company (and not exercised) to exceed or further exceed
                  30,000. Any Stock Options granted in excess of this amount
                  shall be granted under the US Plan.

         (4)      For the purposes of sub-rule (3) above:

                  (a)      in the case of an Option granted under the UK Scheme
                           the aggregate market value of shares shall be
                           calculated as on the day by reference to which the
                           price at which Shares may be acquired by the exercise
                           thereof is determined as mentioned in Rule 5(2)
                           below;

                  (b)      in the case of an Option granted under any other
                           approved scheme, as at the time when it was granted
                           or, in a case where an agreement relating to the
                           shares has been made under paragraph 29 of Schedule
                           9, such earlier time or times as may be provided in
                           the agreement; and

                  (c)      in the case of any other Option, the aggregate fair
                           market value of shares shall be calculated as on the
                           day or days by reference to which the price at which
                           shares may be acquired by the exercise hereof was
                           determined.

         (5)      Unless otherwise agreed with the Inland Revenue, the United
                  States dollar exchange rate for pounds sterling for the
                  purposes of calculating the limit in sub-rule (3) above shall
                  be the noon buying rate in the City of London on the day by

                                  Addendum B-3
<PAGE>   25

                  reference to which the price at which Shares may be acquired
                  on the exercise of the Option is determined as mentioned in
                  Rule 5(2) below.

5.       EXERCISE PRICE AND CONSIDERATION

         (1)      Shares shall be issued to the Participant pursuant to the
                  exercise of an Option only upon receipt by the Company from
                  the Participant of payment in full in cash. The Committee may,
                  in its sole and absolute discretion, permit the exercise of an
                  Approved Stock Option by cashless exercise through an
                  arrangement with a brokerage firm, under which the brokerage
                  firm, on behalf of the participant, pays for all or a portion
                  of the Shares of Common Stock purchased upon the exercise of
                  the Approved Stock Option.

         (2)      The price per Share under each Approved Stock Option granted
                  by the Committee shall be such price as is determined by the
                  Committee before the grant thereof, provided that it shall not
                  be less than 100% of the Fair Market Value per Share on the
                  Option Grant Date (or such other dealing day as may be agreed
                  with the Inland Revenue).

         (3)      Save where the price per Share to the public of the Common
                  Stock in the IPO is agreed by Shares Valuation Division of the
                  Inland Revenue as not being less than the market value of a
                  Share for the purposes of the UK Scheme the Fair Market Value
                  per Share on any day shall be determined as follows:

                  (a)      if shares of the same class as the Shares are quoted
                           on the New York Stock Exchange, the Fair Market Value
                           per Share shall be the closing price per Share in the
                           New York Stock Exchange on the consolidated
                           transaction reporting system on that day (and if
                           there shall be no sale of Shares reported on such
                           date, the Fair Market Value shall be deemed equal to
                           the closing price per Share on the consolidated
                           transaction reporting system for the last preceding
                           date on which sales of Shares were reported);

                  (b)      If paragraph (a) above does not apply, the Fair
                           Market Value shall be equal to the market value
                           (within the meaning of Part VIII of the United
                           Kingdom's Capital Gains Tax Act 1992) of Shares, as
                           agreed for the purposes of the UK Scheme with the
                           Shares Valuation Division of the Inland Revenue, on
                           that day.

6.       EXERCISE OF OPTIONS

         (1)      A person is not eligible to exercise an Approved Stock Option
                  granted under the UK Scheme at any time when he is not
                  eligible to participate in the UK Scheme by virtue of
                  paragraph 8 of Schedule 9.

                                  Addendum B-4
<PAGE>   26

         (2)      Paragraphs 6 and 7 of the US Plan and Section 6 and, subject
                  to Rule 5(1) above, Section 7 of the Terms and Conditions
                  shall apply in respect of Approved Stock Options granted under
                  the UK Scheme.

         (3)      An Approved Stock Option granted under the UK Scheme may not
                  in any circumstances be exercised later than twelve (12)
                  months after the death of the Participant.

7.       ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER

         (1)      Paragraph 14 of the US Plan shall apply to Approved Stock
                  Options granted under the UK Scheme in respect of a variation
                  of capital of the Company only, save that no adjustment under
                  Paragraph 14 shall be made to an Approved Stock Option at a
                  time when the UK Scheme is approved by the Inland Revenue
                  under Schedule 9 without the prior approval of the Inland
                  Revenue.

         (2)      If any company ("the acquiring company") obtains control of
                  the Company as a result of making:

                  (a)      a general offer to acquire the whole of the Common
                           Stock of the Company which is made on a condition
                           such that if it is satisfied the person making the
                           offer will have control of the Company, or

                  (b)      a general offer to acquire all the shares in the
                           Company which are of the same class as the Shares
                           which may be acquired by the exercise of Options
                           granted under the UK Scheme,

                  any Participant may at any time within the appropriate period
                  (which expression shall be construed in accordance with
                  paragraph 15(2) of Schedule 9), by agreement with the
                  acquiring company, release any Option granted under the UK
                  Scheme which has not lapsed ("the old option") in
                  consideration of the grant to him of an option ("the new
                  option") which (for the purposes of that paragraph) is
                  equivalent to the old option but relates to shares in a
                  different company (whether the acquiring company itself or
                  some other company falling within paragraph 10(b) or (c) of
                  Schedule 9).

         (3)      The new option shall not be regarded for the purposes of
                  sub-rule (2) above as equivalent to the old option unless the
                  conditions set out in paragraph 15(3) of Schedule 9 are
                  satisfied, but so that the provisions of the UK Scheme shall
                  for this purpose be construed as if:

                  (a)      the new option was an option granted under the UK
                           Scheme at the same time as the old option;

                                  Addendum B-5
<PAGE>   27

                  (b)      except for the purposes of the definitions of
                           "Participating Company" and "Subsidiary" in Rule 1
                           above and the references to "the Committee" in Rule
                           4(1) above, the reference to Conoco Inc. in the
                           definition of Conoco in Paragraph 3 of the US Plan
                           was a reference to the different company mentioned in
                           sub-rule (2) above.

8.       AMENDMENT AND TERMINATION OF THE UK SCHEME

         (1)      The provisions of Paragraph 6 and Paragraph 12 of the US Plan
                  apply mutatis mutandis to the UK Scheme, save that if an
                  amendment is made to the UK Scheme or to the terms of an
                  Approved Stock Option at a time when the UK Scheme is approved
                  by the Inland Revenue under Schedule 9, the approval will not
                  thereafter have effect unless the Inland Revenue have approved
                  the alteration or addition.

         (2)      As soon as reasonably practicable after making any amendment
                  to the UK Scheme under sub-rule (1) above, the Committee shall
                  give notice in writing thereof to any Participant affected
                  thereby and, if the UK Scheme is then approved by the Inland
                  Revenue under Schedule 9, to the Inland Revenue.

         (3)      In accordance with the Committee's powers under Paragraph 9 of
                  the US Plan, the Committee shall if it deems necessary
                  delegate authority to any one or more of the officers of the
                  Company to be responsible for the administration of the UK
                  Scheme.

         (4)      The Committee or officer(s) of the Company to whom authority
                  has been delegated may amend or alter the UK Scheme either as
                  it is considered necessary (or as may be consequential upon
                  such necessary amendments) to enable the UK Scheme to obtain
                  or maintain the approval of the Inland Revenue under Schedule
                  9 or take account of any applicable legislation.

9.       MISCELLANEOUS

         (1)      Options granted under the UK Scheme shall not be transferable
                  or assignable other than by will or by the laws of decent and
                  distribution and Paragraph 13 of the US Plan shall only apply
                  to Options granted under the UK Scheme in this respect.

         (2)      Within thirty days after an Option has been exercised by any
                  person, the Committee on behalf of the Company shall allot to
                  him or, as appropriate, procure the transfer to him of the
                  number of Shares in respect of which the Option has been
                  exercised.

         (3)      All Shares allotted under the UK Scheme shall rank pari passu
                  in all respects with the Shares of the same class for the time
                  being in issue save as regards any rights

                                  Addendum B-6
<PAGE>   28

                  attaching to such shares by reference to a record date prior
                  to the date of the allotment.

         (4)      Sections 9 to 17 of the Terms and Conditions shall apply in
                  respect of Approved Stock Options to the extent permitted
                  under the UK Scheme.

         (5)      Paragraph 7(e) of the US Plan and the final sub-paragraph of
                  Section 6 of the Terms and Conditions shall not apply to
                  Approved Stock Options.

         (6)      For the avoidance of doubt references to Stock Appreciation
                  Rights in the US Plan and the Terms and Conditions shall be
                  disregarded for the purposes of the UK Scheme.

                                  Addendum B-7

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