Document:

EXHIBIT 10.8

                          REGISTRATION RIGHTS AGREEMENT

         REGISTRATION   RIGHTS  AGREEMENT  (this   "Agreement"),   dated  as  of
__________,  2001,  by and among  WaveRider  Communications  Inc., a corporation
organized  under  the  laws of the  State of  Nevada  (the  "Company"),  and the
undersigned (together with its affiliates, the "Initial Investor").

         WHEREAS:

         A. In connection with the Securities  Purchase  Agreement,  dated as of
December 8, 2000,  by and between  the  Company  and the Initial  Investor  (the
"Securities  Purchase  Agreement"),  the Company has agreed,  upon the terms and
subject to the conditions  contained  therein,  to issue and sell to the Initial
Investor (i) Convertible Notes (the "Notes") that are convertible into shares of
the Company's common stock, par value $.001 per share (the "Common Stock"),  and
(ii) warrants (the  "Warrants") to acquire shares of Common Stock. The shares of
Common Stock issuable upon conversion of or otherwise  pursuant to the Notes are
referred to herein as the  "Conversion  Shares"  and the shares of Common  Stock
issuable upon exercise of or otherwise  pursuant to the Warrants are referred to
herein as the "Warrant Shares."

         B. To induce the Initial Investor to execute and deliver the Securities
Purchase  Agreement,  the  Company  has agreed to provide  certain  registration
rights  under  the  Securities  Act of  1933,  as  amended,  and the  rules  and
regulations  thereunder,  or any similar  successor statute  (collectively,  the
"Securities Act"), and applicable state securities laws.

         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
covenants  contained  herein  and other  good and  valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged,  the Company and the
Initial Investor hereby agree as follows:

         1.       DEFINITIONS.

                  (a) As used in this Agreement,  the following terms shall have
the following meanings:

                  (i) "Investors" means the Initial Investor and any transferees
or assignees who agree to become bound by the  provisions  of this  Agreement in
accordance with Section 9 hereof.

                  (ii) "register,"  "registered," and "registration"  refer to a
registration  effected  by  preparing  and filing a  Registration  Statement  or
Statements in compliance  with the Securities Act and pursuant to Rule 415 under
the Securities Act or any successor rule providing for offering  securities on a
continuous  basis ("Rule 415"), and the declaration or ordering of effectiveness
of such  Registration  Statement by the United  States  Securities  and Exchange
Commission (the "SEC").

                  (iii)  "Registrable   Securities"  means  (a)  the  Conversion
Shares,  (b) the Warrant  Shares and (c) any shares of capital  stock  issued or
issuable,  from time to time (with any adjustments),  as a distribution on or in
exchange  for or  otherwise  with  respect to any of the  foregoing,  whether as
default payments or otherwise.

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                  (iv) "Registration  Statement" means a registration  statement
of the Company under the
Securities Act.

                  (b)  Capitalized  terms used herein and not otherwise  defined
herein shall have the respective  meanings set forth in the Securities  Purchase
Agreement.

         2.       REGISTRATION.

                  (a) Mandatory Registration. The Company shall prepare promptly
and file with the SEC as soon as  practicable,  but in no event  later  than the
20th day following the date hereof (the "Filing Date"), a Registration Statement
on Form S-3 (or, if Form S-3 is not then available, on such form of Registration
Statement  as is  then  available  to  effect  a  registration  of  all  of  the
Registrable Securities, subject to the consent of the Initial Investor) covering
the  resale  of at  least  ________  Registrable  Securities.  The  Registration
Statement filed hereunder,  to the extent allowable under the Securities Act and
the Rules  promulgated  thereunder  (including Rule 416),  shall state that such
Registration  Statement  also covers  such  indeterminate  number of  additional
shares of Common Stock as may become  issuable upon  conversion of the Notes and
exercise of the Warrants to prevent dilution resulting from stock splits,  stock
dividends or similar  transactions.  The Registrable  Securities included in the
Registration  Statement  shall be  allocated  to the  Investors  as set forth in
Section  11(k)  hereof.  The  Registration  Statement  (and  each  amendment  or
supplement thereto, and each request for acceleration of effectiveness  thereof)
shall be provided to (and subject to the  approval of) the Initial  Investor and
its counsel prior to its filing or other submission.

                  (b)  Underwritten  Offering.  If any offering  pursuant to the
Registration  Statement pursuant to Section 2(a) hereof involves an underwritten
offering,  the  Investors  who hold a majority in  interest  of the  Registrable
Securities  subject  to such  underwritten  offering,  with the  consent  of the
Initial Investor if it is still holding Registrable  Securities,  shall have the
right to select one legal  counsel to represent  the Investors and an investment
banker or bankers  and manager or managers to  administer  the  offering,  which
investment  banker  or  bankers  or  manager  or  managers  shall be  reasonably
satisfactory  to the  Company.  In the  event  that any  Investors  elect not to
participate in such underwritten  offering,  the Registration Statement covering
all  of  the  Registrable   Securities  shall  contain   appropriate   plans  of
distribution  reasonably  satisfactory  to the Investors  participating  in such
underwritten  offering and the  Investors  electing not to  participate  in such
underwritten   offering   (including,   without   limitation,   the  ability  of
nonparticipating  Investors to sell from time to time and at any time during the
effectiveness of such Registration Statement). Notwithstanding the foregoing, if
the offering does not involve an underwritten  offer, the Investors shall not be
entitled to require that the offering be underwritten.

                  (c)  Payments  by the  Company.  The  Company  shall cause the
Registration  Statement  required to be filed pursuant to Section 2(a) hereof to
become  effective as soon as  practicable,  but in no event later than the 120th
day  following  the date hereof (the  "Registration  Deadline").  At the time of
effectiveness,  the Company shall ensure such  Registration  Statement covers at
least 100% of the  Registrable  Securities  issuable  pursuant  to the Notes and
Warrants (including, if necessary, by filing an amendment prior to the effective
date of the  Registration  Statement  to increase  the number of shares  covered
thereby).  If (i) (A) the  Registration  Statement  required  to be filed by the
Company  pursuant to Section  2(a) hereof is not filed with the SEC prior to the

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Filing Date or (B) such Registration  Statement  covering all of the Registrable
Securities  is not declared  effective by the SEC on or before the  Registration
Deadline  (except in the event that such  Registration  Statement shall not have
been  declared  effective  solely as the  result of a Fiscal  Quarter  Delay (as
defined  herein)),  or (ii)  if,  after  such  Registration  Statement  has been
declared  effective  by the  SEC,  sales  of any of the  Registrable  Securities
required to be covered by such Registration Statement cannot be made pursuant to
such Registration  Statement (by reason of a stop order or the Company's failure
to update the Registration  Statement or any other reason outside the control of
the  Investors),  or (iii)  the  Common  Stock is not  listed  or  included  for
quotation on the Nasdaq  National  Market  ("NNM"),  the Nasdaq  SmallCap Market
("SmallCap"),  the New York Stock  Exchange  (the "NYSE") or the American  Stock
Exchange  (the "AMEX") at any time after the  Registration  Deadline  hereunder,
then the Company will make payments to the Investors in such amounts and at such
times as shall be determined pursuant to this Section 2(c) as partial relief for
the  damages to the  Investors  by reason of any such delay in or  reduction  of
their  ability to sell the  Registrable  Securities  (which  remedy shall not be
exclusive  of any other  remedies  available  at law or in equity).  The Company
shall pay to each  Investor an amount equal to the product of (i) the  aggregate
Purchase  Price of the  Notes and  Warrants  held by such  Investor  (including,
without  limitation,  Notes that have been converted into Conversion  Shares and
Warrants that have been exercised for Warrant Shares then held by such Investor)
(the "Aggregate Share Price"),  multiplied by (ii) fifteen  thousandths  (.015),
for each 30-day period (or portion  thereof) (A) after the Filing Date and prior
to the date the Registration Statement is filed with the SEC pursuant to Section
2(a), (B) after the Registration Deadline and prior to the date the Registration
Statement  covering all of the Registrable  Securities is declared  effective by
the SEC, and (C) during which sales of any Registrable Securities cannot be made
pursuant to any such Registration Statement after the Registration Statement has
been  declared  effective  or the  Common  Stock is not listed or  included  for
quotation on the NNM,  SmallCap,  NYSE or AMEX;  provided,  however,  that there
shall be excluded from each such period any delays which are solely attributable
to  changes  (other  than  corrections  of  Company  mistakes  with  respect  to
information  previously  provided by the Investors) required by the Investors in
the  Registration   Statement  with  respect  to  information  relating  to  the
Investors,  including, without limitation,  changes to the plan of distribution.
(For example,  if the  Registration  Statement  covering all of the  Registrable
Securities is not effective by the Registration  Deadline, the Company would pay
$15,000 for each 30-day  period  thereafter  with respect to each  $1,000,000 of
Aggregate Share Price until the Registration  Statement becomes effective.) Such
amounts shall be paid in cash or, at each Investor's  option, may be convertible
into Common  Stock at the  "Conversion  Price" (as defined in the Notes) then in
effect.  Any shares of Common Stock issued upon conversion of such amounts shall
be Registrable  Securities.  If the Investor  desires to convert the amounts due
hereunder into Registrable  Securities it shall so notify the Company in writing
within two business  days after the date on which such amounts are first payable
in cash and such amounts shall be so convertible  (pursuant to the mechanics set
forth under Article III of the Notes),  beginning on the last day upon which the
cash amount would  otherwise be due in accordance  with the following  sentence.
Payments of cash pursuant hereto shall be made within five days after the end of
each  period  that gives rise to such  obligation,  provided  that,  if any such
period  extends for more than 30 days,  interim  payments shall be made for each
such 30-day period.  Notwithstanding  anything to the contrary contained in this
Section  2(c), no such amounts will be payable by the Company to an Investor for
the first 120 days after the date  hereof to the extent such  Investor  converts
any of the Notes  during  such  period  and the  Registration  Statement  is not
effective as of the date of such conversion.

                  (d)  Piggy-Back  Registrations.  If at any  time  prior to the
expiration  of the  Registration  Period (as  hereinafter  defined) and during a
period in which the  Registration  Statement  required  to be filed  pursuant to
Section  2(a)  is  not  effective,  the  Company  shall  file  with  the  SEC  a
Registration  Statement  relating  to an  offering  for its own  account  or the
account  of others  under the  Securities  Act of any of its  equity  securities
(other than on Form S-4 or Form S-8 or their then equivalents relating to equity
securities to be issued solely in connection  with any acquisition of any entity
or business or equity  securities  issuable in  connection  with stock option or
other employee  benefit plans),  the Company shall send to each Investor written
notice of such filing and, if within 15 days after the date of such notice, such
Investor  shall so  request  in  writing,  the  Company  shall  include  in such
Registration  Statement  all or any  part  of the  Registrable  Securities  such

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Investor  requests  to be  registered,  except that if, in  connection  with any
underwritten public offering, the managing underwriter(s) thereof shall impose a
limitation  on the number of shares of Common Stock which may be included in the
Registration Statement because, in such underwriter's or underwriters' judgment,
marketing or other  factors  dictate such  limitation is necessary to facilitate
public  distribution,  then the Company  shall be  obligated  to include in such
Registration  Statement only such limited portion of the Registrable  Securities
with respect to which such  Investor has  requested  inclusion  hereunder as the
underwriter shall permit. Any exclusion of Registrable  Securities shall be made
pro rata  among the  Investors  seeking to include  Registrable  Securities,  in
proportion to the number of Registrable Securities sought to be included by such
Investors; provided, however, that the Company shall not exclude any Registrable
Securities unless the Company has first excluded all outstanding securities, the
holders of which are not contractually  entitled to inclusion of such securities
in such  Registration  Statement or are not  contractually  entitled to pro rata
inclusion with the Registrable Securities; and provided, further, however, that,
after giving  effect to the  immediately  preceding  proviso,  any  exclusion of
Registrable  Securities  shall be made pro rata with holders of other securities
having the  contractual  right to include such  securities  in the  Registration
Statement other than holders of securities  contractually  entitled to inclusion
of  their  securities  in  such  Registration  Statement  by  reason  of  demand
registration  rights.  No right to registration of Registrable  Securities under
this Section 2(d) shall be construed to limit any  registration  required  under
Section  2(a)  hereof.  If an offering in  connection  with which an Investor is
entitled to registration  under this Section 2(d) is an  underwritten  offering,
then  each  Investor   whose   Registrable   Securities  are  included  in  such
Registration  Statement shall, unless otherwise agreed by the Company, offer and
sell such  Registrable  Securities in an  underwritten  offering  using the same
underwriter or underwriters and, subject to the provisions of this Agreement, on
the same terms and  conditions as other shares of Common Stock  included in such
underwritten offering.

                  (e)  Eligibility  for Form S-3.  The  Company  represents  and
warrants that, as of the date hereof,  it meets the  requirements for the use of
Form S-3 for  registration  of the sale by the  Initial  Investor  and any other
Investor of the  Registrable  Securities  and the Company shall file all reports
required  to be filed by the  Company  with the SEC in a timely  manner so as to
maintain such eligibility for the use of Form S-3.

                  3.  OBLIGATIONS  OF  THE  COMPANY.   In  connection  with  the
registration of the Registrable Securities, the Company shall have the following
obligations:

                  (a) The Company shall respond promptly to any and all comments
made by the staff of the SEC to the Registration  Statement  required by Section
2(a), and shall submit to the SEC,  before the close of business on the business
day  immediately  following the business day on which the Company learns (either
by telephone or in writing) that no review of such  Registration  Statement will
be made by the SEC or that the staff of the SEC has no further  comments on such
Registration  Statement,  as the case may be, a request for  acceleration of the
effectiveness  of such  Registration  Statement  to a time  and  date as soon as
practicable;  provided,  however, that (unless expressly permitted in writing by
the Investors) no such request for acceleration  shall be made during the period
beginning on the tenth  trading day  immediately  preceding  the end of a fiscal
quarter of the  Company  and ending on the second  business  day  following  the
release by the Company of its earnings statement for such fiscal quarter (such a
delay  in  filing  a  request  for  acceleration  of  the  effectiveness  of the
Registration  Statement  being  referred to as a "Fiscal  Quarter  Delay").  The
Company shall keep such Registration Statement effective pursuant to Rule 415 at
all times  until such date as is the earlier of (i) the date on which all of the
Registrable  Securities  have  been  sold and (ii) the date on which  all of the
Registrable  Securities  (in the  reasonable  opinion of counsel to the  Initial

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Investor)  may  be  immediately  sold  to the  public  without  registration  or
restriction  pursuant to Rule 144(k) under the  Securities  Act or any successor
provision (the "Registration  Period"),  which Registration Statement (including
any amendments or supplements thereto and prospectuses contained therein and all
documents  incorporated  by reference  therein) (i) shall comply in all material
respects  with  the  requirements  of the  Securities  Act  and  the  rules  and
regulations  of the SEC  promulgated  thereunder  and (ii) shall not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein,  or necessary to make the statements  therein not misleading.
The financial  statements of the Company included in the Registration  Statement
or  incorporated  by  reference  therein  will comply as to form in all material
respects with the applicable accounting requirements and the published rules and
regulations  of  the  SEC  applicable  with  respect  thereto.   Such  financial
statements  will  be  prepared  in  accordance  with  U.S.   generally  accepted
accounting principles, consistently applied, during the periods involved (except
(i) as may be otherwise  indicated  in such  financial  statements  or the notes
thereto, or (ii) in the case of unaudited interim statements, to the extent they
may not include  footnotes or may be condensed on summary  statements and fairly
present in all material  respects  the  consolidated  financial  position of the
Company  and its  consolidated  subsidiaries  as of the  dates  thereof  and the
consolidated  results of their  operations  and cash flows for the periods  then
ended  (subject,  in the case of unaudited  statements,  to immaterial  year-end
adjustments).

                  (b) The  Company  shall  prepare  and  file  with the SEC such
amendments  (including   post-effective   amendments)  and  supplements  to  the
Registration   Statement  and  the  prospectus   used  in  connection  with  the
Registration  Statement as may be necessary to keep the  Registration  Statement
effective at all times during the Registration  Period, and, during such period,
comply with the provisions of the Securities Act with respect to the disposition
of  all  Registrable  Securities  of the  Company  covered  by the  Registration
Statement  until  such  time as all of such  Registrable  Securities  have  been
disposed of in accordance with the intended methods of disposition by the seller
or sellers thereof as set forth in the Registration Statement.

                  (c)  The  Company  shall   furnish  to  each  Investor   whose
Registrable  Securities are included in the Registration Statement and its legal
counsel (i) promptly after the same is prepared and publicly distributed,  filed
with the SEC, or received by the Company, one copy of the Registration Statement
and any amendment thereto,  each preliminary  prospectus and prospectus and each
amendment or supplement thereto, and, in the case of the Registration  Statement
referred to in Section 2(a),  each letter written by or on behalf of the Company
to the SEC or the staff of the SEC (including,  without limitation,  any request
to  accelerate  the  effectiveness  of the  Registration  Statement or amendment
thereto),  and each item of correspondence from the SEC or the staff of the SEC,
in each case relating to the Registration  Statement (other than any portion, if
any,  thereof  which  contains  information  for which the  Company  has  sought
confidential  treatment),  (ii) on the date of effectiveness of the Registration
Statement or any  amendment  thereto,  a notice  stating  that the  Registration
Statement or amendment  has been  declared  effective,  and (iii) such number of
copies of a prospectus,  including a preliminary prospectus,  and all amendments
and supplements thereto and such other documents as such Investor may reasonably
request in order to facilitate  the  disposition of the  Registrable  Securities
owned by such Investor.

                  (d) The Company shall use its best efforts to (i) register and
qualify the Registrable  Securities covered by the Registration  Statement under
such other  securities  or "blue sky" laws of such  jurisdictions  in the United
States  as  each  Investor  who  holds  Registrable   Securities  being  offered
reasonably  requests,   (ii)  prepare  and  file  in  those  jurisdictions  such
amendments  (including  post-effective   amendments)  and  supplements  to  such
registrations   and   qualifications   as  may  be  necessary  to  maintain  the
effectiveness  thereof  during the  Registration  Period,  (iii) take such other
actions as may be necessary to maintain such registrations and qualifications in
effect at all times  during  the  Registration  Period,  and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable  Securities
for sale in such jurisdictions; provided, however, that the Company shall not be
required in connection  therewith or as a condition thereto to (a) qualify to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this Section 3(d),  (b) subject  itself to general  taxation in any such
jurisdiction,  (c) file a general  consent  to  service  of  process in any such
jurisdiction,  (d) provide any undertakings that cause the Company undue expense
or burden,  or (e) make any change in its charter or bylaws,  which in each case
the Board of  Directors  of the  Company  determines  to be contrary to the best
interests of the Company and its stockholders.

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                  (e) In the event the Investors who hold a majority in interest
of the Registrable  Securities being offered in an offering select  underwriters
for the offering, the Company shall enter into and perform its obligations under
an  underwriting  agreement,  in usual and customary  form,  including,  without
limitation,  customary  indemnification and contribution  obligations,  with the
underwriters of such offering.

                  (f) As promptly as  practicable  after  becoming aware of such
event,  the Company shall notify each Investor by telephone and facsimile of the
happening of any event, of which the Company has knowledge, as a result of which
the  prospectus  included  in the  Registration  Statement,  as then in  effect,
includes an untrue  statement of a material fact or omission to state a material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading,  and, use its best efforts  promptly to prepare a supplement or
amendment to the  Registration  Statement  to correct  such untrue  statement or
omission,  and deliver such number of copies of such  supplement or amendment to
each Investor as such Investor may reasonably  request.  Investor agrees to keep
such information confidential until such information becomes publicly disclosed.

                  (g) The Company  shall use its best efforts (i) to prevent the
issuance  of  any  stop  order  or  other   suspension  of  effectiveness  of  a
Registration  Statement,  and,  if  such an  order  is  issued,  to  obtain  the
withdrawal of such order at the earliest  practicable  moment (including in each
case by amending  or  supplementing  such  Registration  Statement)  and (ii) to
notify each  Investor who holds  Registrable  Securities  being sold (or, in the
event of an underwritten offering, the managing underwriters) of the issuance of
such order and the  resolution  thereof (and if such  Registration  Statement is
supplemented  or amended,  deliver such number of copies of such  supplement  or
amendment to each Investor as such Investor may reasonably request).

                  (h)  The  Company  shall  permit  a  single  firm  of  counsel
designated by the Initial Investor to review the Registration  Statement and all
amendments  and  supplements  thereto a  reasonable  period of time prior to its
filing with the SEC,  and not file any  document in a form to which such counsel
reasonably objects.

                  (i) The Company shall make generally available to its security
holders as soon as practical,  but not later than 90 days after the close of the
period  covered  thereby,  an earnings  statement  (in form  complying  with the
provisions  of Rule 158 under the  Securities  Act)  covering a 12-month  period
beginning  not later than the first day of the  Company's  fiscal  quarter  next
following the effective date of the Registration Statement.

                  (j)  At  the  request  of  any  Investor  in  the  case  of an
underwritten  public  offering,  the  Company  shall  furnish,  on the  date  of
effectiveness  of the  Registration  Statement (i) an opinion,  dated as of such
date, from counsel  representing  the Company  addressed to the Investors and in
form,  scope and substance as is  customarily  given in an  underwritten  public
offering  and (ii) a letter,  dated such date,  from the  Company's  independent
certified  public  accountants in form and substance as is customarily  given by
independent  certified  public  accountants to  underwriters  in an underwritten
public offering, addressed to the underwriters, if any, and the Investors.

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                  (k) The Company shall make available for inspection by (i) any
Investor, (ii) any underwriter  participating in any disposition pursuant to the
Registration Statement,  (iii) one firm of attorneys and one firm of accountants
or other  agents  retained  by the  Investors,  and  (iv) one firm of  attorneys
retained by all such underwriters (collectively, the "Inspectors") all pertinent
financial and other records, and pertinent corporate documents and properties of
the  Company  (collectively,  the  "Records"),  as  shall be  reasonably  deemed
necessary  by each  Inspector  to enable  each  Inspector  to  exercise  its due
diligence  responsibility,  and  cause the  Company's  officers,  directors  and
employees to supply all information  which any Inspector may reasonably  request
for purposes of such due diligence; provided, however, that each Inspector shall
hold in confidence and shall not make any disclosure  (except to an Investor) of
any Record or other information which the Company determines in good faith to be
confidential,  and of which determination the Inspectors are so notified, unless
(a)  the  disclosure  of such  Records  is  necessary  to  avoid  or  correct  a
misstatement or omission in any Registration Statement,  (b) the release of such
Records  is  ordered  pursuant  to a  subpoena  or other  order  from a court or
government  body  of  competent  jurisdiction,  or (c) the  information  in such
Records has been made generally available to the public other than by disclosure
in violation of this or any other  agreement.  The Company shall not be required
to disclose any confidential  information in such Records to any Inspector until
and unless such Inspector shall have entered into confidentiality agreements (in
form and  substance  satisfactory  to the Company) with the Company with respect
thereto,  substantially  in the form of this Section 3(k).  Each Investor agrees
that it shall,  upon learning that disclosure of such Records is sought in or by
a court or governmental  body of competent  jurisdiction or through other means,
give prompt  notice to the Company and allow the  Company,  at its  expense,  to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, the Records  deemed  confidential.  Nothing herein shall be deemed to
limit the Investors' ability to sell Registrable Securities in a manner which is
otherwise consistent with applicable laws and regulations.

                  (l) The  Company  shall  hold in  confidence  and not make any
disclosure of information  concerning an Investor provided to the Company unless
(i) disclosure of such  information is necessary to comply with federal or state
securities  laws, (ii) the disclosure of such  information is necessary to avoid
or correct a misstatement or omission in any Registration  Statement,  (iii) the
release of such  information  is ordered  pursuant  to a subpoena or other order
from  a  court  or  governmental  body  of  competent  jurisdiction,  (iv)  such
information  has been made  generally  available  to the  public  other  than by
disclosure  in violation of this or any other  agreement,  or (v) such  Investor
consents to the form and content of any such disclosure. The Company agrees that
it shall,  upon  learning  that  disclosure  of such  information  concerning an
Investor  is  sought  in  or  by a  court  or  governmental  body  of  competent
jurisdiction  or through other means,  give prompt notice to such Investor prior
to making such disclosure,  and allow the Investor, at its expense, to undertake
appropriate  action to prevent  disclosure  of, or to obtain a protective  order
for, such information.

                  (m) The Company shall use its best efforts to promptly  either
(i)  cause  all of  the  Registrable  Securities  covered  by  the  Registration
Statement  to be listed on the NYSE or the AMEX or another  national  securities
exchange and on each additional national securities exchange on which securities
of the same class or series  issued by the Company are then  listed,  if any, if
the listing of such Registrable  Securities is then permitted under the rules of
such  exchange,  or (ii)  secure the  designation  and  quotation  of all of the
Registrable  Securities  covered  by the  Registration  Statement  on the NNM or
SmallCap and, without  limiting the generality of the foregoing,  to arrange for
or maintain at least two market makers to register with the National Association
of Securities  Dealers,  Inc.  ("NASD") as such with respect to such Registrable
Securities.

                  (n) The Company shall provide a transfer  agent and registrar,
which may be a single entity, for the Registrable  Securities not later than the
effective date of the Registration Statement.

                                       7
<PAGE>

                  (o) The Company  shall  cooperate  with the Investors who hold
Registrable   Securities   being  offered  and  the  managing   underwriter   or
underwriters,  if any, to  facilitate  the timely  preparation  and  delivery of
certificates  (not bearing any  restrictive  legends)  representing  Registrable
Securities to be offered pursuant to the Registration  Statement and enable such
certificates to be in such denominations or amounts,  as the case may be, as the
managing  underwriter or  underwriters,  if any, or the Investors may reasonably
request  and   registered  in  such  names  as  the  managing   underwriter   or
underwriters,  if any, or the Investors may request,  and, within three business
days after the Registration  Statement which includes Registrable  Securities is
ordered  effective by the SEC, the Company shall deliver,  and shall cause legal
counsel  selected  by the  Company to  deliver,  to the  transfer  agent for the
Registrable   Securities  (with  copies  to  the  Investors  whose   Registrable
Securities  are  included in such  Registration  Statement),  an opinion of such
counsel in the form attached hereto as Exhibit 1.

                  (p) At the request of any Investor,  the Company shall prepare
and file with the SEC such amendments (including post-effective  amendments) and
supplements  to a Registration  Statement and the prospectus  used in connection
with such Registration Statement as may be necessary in order to change the plan
of distribution set forth in such Registration Statement.

                  (q) The Company shall comply with all applicable  laws related
to a  Registration  Statement  and  offering  and  sale  of  securities  and all
applicable  rules and  regulations  of  governmental  authorities  in connection
therewith (including,  without limitation, the Securities Act and the Securities
Exchange Act of 1934, as amended,  and the rules and regulations  promulgated by
the SEC.)

                  (r) From and after  the date of this  Agreement,  the  Company
shall not,  and shall not agree to, allow the holders of any  securities  of the
Company to include any of their securities which are not Registrable  Securities
in the  Registration  Statement  under  Section 2(a) hereof or any  amendment or
supplement  thereto  under  Section 3(b) hereof,  other than  securities  of the
Company issued to brokers and finders set forth on Schedule 3(r) hereof, without
the  consent  of the  holders  of a  majority  in  interest  of the  Registrable
Securities.

                  4.  OBLIGATIONS  OF THE  INVESTORS.  In  connection  with  the
registration  of the  Registrable  Securities,  the  Investors  shall  have  the
following obligations:

                  (a) It shall be a condition  precedent to the  obligations  of
the Company to complete the registration pursuant to this Agreement with respect
to the Registrable  Securities of a particular Investor that such Investor shall
furnish to the  Company  such  information  regarding  itself,  the  Registrable
Securities  held by it and the intended method of disposition of the Registrable
Securities held by it as shall be reasonably required to effect the registration
of such  Registrable  Securities  and shall execute such documents in connection
with such  registration  as the Company may  reasonably  request.  At least five
trading  days prior to the first  anticipated  filing  date of the  Registration
Statement, the Company shall notify each Investor of the information the Company
requires from each such Investor.

                  (b)  Each  Investor,  by  such  Investor's  acceptance  of the
Registrable  Securities,  agrees to  cooperate  with the  Company as  reasonably
requested by the Company in connection  with the  preparation  and filing of the
Registration Statement hereunder,  unless such Investor has notified the Company
in  writing  of such  Investor's  election  to  exclude  all of such  Investor's
Registrable Securities from such Registration Statement.

                  (c) In the event  Investors  holding a majority in interest of
the Registrable  Securities being offered determine to engage the services of an
underwriter,  each  Investor  agrees to enter into and perform  such  Investor's
obligations  under an  underwriting  agreement,  in usual  and  customary  form,
including,  without  limitation,   customary  indemnification  and  contribution
obligations,  with the  underwriter(s) of such offering and the Company and take
such other actions as are reasonably required in order to expedite or facilitate
the disposition of the Registrable Securities, unless such Investor has notified
the Company in writing of such  Investor's  election not to  participate in such
underwritten distribution.

                                       8
<PAGE>

                  (d) Each Investor agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Sections 3(f)
or 3(g), such Investor will immediately  discontinue  disposition of Registrable
Securities  pursuant to the  Registration  Statement  covering such  Registrable
Securities  until such Investor's  receipt of the copies of the  supplemented or
amended prospectus  contemplated by Sections 3(f) or 3(g) and, if so directed by
the Company,  such Investor  shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a  certificate  of  destruction)
all  copies in such  Investor's  possession,  of the  prospectus  covering  such
Registrable   Securities  current  at  the  time  of  receipt  of  such  notice.
Notwithstanding anything to the contrary,  subject to compliance with applicable
laws, the Company shall cause the transfer agent for the Registrable  Securities
to deliver  unlegended  shares of Common Stock to a transferee of an Investor in
accordance  with the terms of the Notes and Warrants in connection with any sale
of Registrable Securities with respect to which such Investor has entered into a
contract  for sale prior to receipt of such  notice and for which such  Investor
has not yet settled.

                  (e)  No  Investor   may   participate   in  any   underwritten
distribution  hereunder  unless such Investor (i) agrees to sell such Investor's
Registrable Securities on the basis provided in any underwriting arrangements in
usual and  customary  form  entered  into by the  Company,  (ii)  completes  and
executes  all  questionnaires,  powers of  attorney,  indemnities,  underwriting
agreements  and  other  documents  reasonably  required  under the terms of such
underwriting  arrangements,  (iii)  agrees  to pay its  pro  rata  share  of all
underwriting  discounts  and  commissions  and any  expenses  in excess of those
payable by the Company  pursuant to Section 5 below,  and (iv) complies with all
applicable  laws  in  connection  therewith.  Notwithstanding  anything  in this
Section  4(e) to the  contrary,  this  Section  4(e) is not intended to limit an
Investor's rights under Sections 2(a) or 3(b) hereof.

                  (f) Based on the  reasonable  determination  of the  Company's
Board of Directors that there is a valid business  purpose to do so, the Company
may suspend the use of the  prospectus  relating to the  Registration  Statement
required to be filed  pursuant to Section  2(a) for two distinct  periods,  such
periods  aggregating a total of 30 days or less, within any 12-month period. The
Company shall in no event be required to disclose the business purpose for which
it has  suspended the use of such  prospectus  if the Company  determines in its
good faith judgment that such business purpose should remain  confidential.  The
Investors  shall notify the Company  promptly after the last of its  Registrable
Securities has been sold. The Investors agree not to sell any of the Registrable
Securities  unless (A) the  Registrable  Securities have been sold in accordance
with  the  Registration  Statement,   the  Securities  Act  and  the  rules  and
regulations  promulgated  under  the  Securities  Act and any  applicable  state
securities  or blue sky laws and (B) the  requirement  of  delivering  a current
prospectus has been satisfied.

         5. EXPENSES OF REGISTRATION.  All reasonable  expenses  incurred by the
Company  or  the  Investors  in  connection  with   registrations,   filings  or
qualifications  pursuant  to  Sections  2  and  3  above,   including,   without
limitation,  all registration,  listing and  qualifications  fees,  printers and
accounting  fees, the fees and  disbursements of counsel for the Company and the
fees and  disbursements  of one counsel selected by the Investors shall be borne
by  the  Company;  provided,   however,  that  all  underwriting  discounts  and
commissions  shall be borne by the  Investors  and the fees and  expenses of the
Investors'  counsel shall be subject to the  limitation on expenses set forth in
Section 4(f) of the  Securities  Purchase  Agreement.  In addition,  the Company
shall  pay all of the  Investors'  costs and  expenses  (including  legal  fees)
incurred  in  connection  with the  enforcement  of the rights of the  Investors
hereunder.

                  6.  INDEMNIFICATION.  In the event any Registrable  Securities
are included in a Registration Statement under this Agreement:

                                       9
<PAGE>

                  (a)  To  the  extent   permitted  by  law,  the  Company  will
indemnify, hold harmless and defend (i) each Investor who holds such Registrable
Securities, and (ii) the directors,  officers,  partners, members, employees and
agents of such  Investor and each person who  controls  any Investor  within the
meaning  of  Section 15 of the  Securities  Act or Section 20 of the  Securities
Exchange  Act of 1934,  as amended  (the  "Exchange  Act"),  if any,  (each,  an
"Indemnified  Person"),  against any joint or several losses,  claims,  damages,
liabilities  or expenses  (collectively,  together with actions,  proceedings or
inquiries by any regulatory or self-regulatory  organization,  whether commenced
or  threatened,  in respect  thereof,  "Claims") to which any of them may become
subject  insofar as such Claims  arise out of or are based upon:  (i) any untrue
statement  or alleged  untrue  statement  of a material  fact in a  Registration
Statement or the omission or alleged  omission to state  therein a material fact
required  to  be  stated  or  necessary  to  make  the  statements  therein  not
misleading,  (ii) any untrue statement or alleged untrue statement of a material
fact contained in any preliminary prospectus if used prior to the effective date
of such Registration Statement, or contained in the final prospectus (as amended
or  supplemented,  if the  Company  files any  amendment  thereof or  supplement
thereto with the SEC) or the omission or alleged  omission to state  therein any
material fact  necessary to make the  statements  made therein,  in light of the
circumstances  under which the  statements  therein were made,  not  misleading;
provided,  however,  the Investor shall only be entitled to the  indemnification
specified under Sections 6(a)(i) and 6(a)(ii) hereof if the Investor delivered a
prospectus provided by the Company pursuant to Section 3(c) hereof, or (iii) any
violation  or alleged  violation  by the  Company  of the  Securities  Act,  the
Exchange Act, any other law, including, without limitation, any state securities
law, or any rule or regulation  thereunder  relating to the offer or sale of the
Registrable  Securities (the matters in the foregoing  clauses (i) through (iii)
being,  collectively,  "Violations").  Subject to the  restrictions set forth in
Section  6(c) with  respect to the number of legal  counsel,  the Company  shall
reimburse  the  Investors and each other  Indemnified  Person,  promptly as such
expenses are incurred and are due and payable,  for any reasonable legal fees or
other reasonable  expenses incurred by them in connection with  investigating or
defending  any such Claim.  Notwithstanding  anything to the contrary  contained
herein, the indemnification  agreement contained in this Section 6(a): (i) shall
not apply to a Claim  arising out of or based upon a Violation  which  occurs in
reliance upon and in  conformity  with  information  furnished in writing to the
Company  by  such  Indemnified  Person  expressly  for  use in the  Registration
Statement or any such amendment  thereof or supplement  thereto;  (ii) shall not
apply to amounts paid in settlement of any Claim if such  settlement is effected
without the prior  written  consent of the Company,  which  consent shall not be
unreasonably  withheld;  and (iii) with respect to any  preliminary  prospectus,
shall not inure to the benefit of any Indemnified Person if the untrue statement
or  omission  of material  fact  contained  in the  preliminary  prospectus  was
corrected on a timely basis in the prospectus,  as then amended or supplemented,
if such corrected  prospectus was timely made available by the Company  pursuant
to Section  3(c) hereof,  and the  Indemnified  Person was  promptly  advised in
writing not to use the  incorrect  prospectus  prior to the use giving rise to a
Violation and such Indemnified  Person,  notwithstanding  such advice,  used it.
Such  indemnity  shall  remain  in  full  force  and  effect  regardless  of any
investigation  made by or on behalf of the Indemnified  Person and shall survive
the transfer of the Registrable  Securities by the Investors pursuant to Section
9 hereof.

                  (b) In connection with any Registration  Statement in which an
Investor is  participating,  each such Investor agrees severally and not jointly
to  indemnify,  hold  harmless  and  defend,  to the same extent and in the same
manner set forth in Section 6(a), the Company,  each of its  directors,  each of
its officers who signs the  Registration  Statement,  its employees,  agents and
each person,  if any, who controls the Company  within the meaning of Section 15
of the  Securities  Act or  Section  20 of  the  Exchange  Act,  and  any  other
stockholder selling securities pursuant to the Registration  Statement or any of
its directors or officers or any person who controls such stockholder within the
meaning of the  Securities  Act or the Exchange Act  (collectively  and together
with an Indemnified Person, an "Indemnified Party"),  against any Claim to which
any of them may become  subject,  under the Securities  Act, the Exchange Act or

                                       10
<PAGE>

otherwise,  insofar as such Claim arises out of or is based upon any  Violation,
in each case to the extent (and only to the extent) that such  Violation  occurs
in reliance upon and in  conformity  with written  information  furnished to the
Company by such Investor  expressly for use in connection with such Registration
Statement; and subject to Section 6(c) such Investor will reimburse any legal or
other expenses  (promptly as such expenses are incurred and are due and payable)
reasonably  incurred by them in connection with  investigating  or defending any
such Claim;  provided,  however,  that the indemnity agreement contained in this
Section 6(b) shall not apply to amounts paid in  settlement of any Claim if such
settlement is effected without the prior written consent of such Investor, which
consent shall not be unreasonably withheld; provided, further, however, that the
Investor shall be liable under this Agreement  (including  this Section 6(b) and
Section 7) for only that  amount as does not exceed  the net  proceeds  actually
received  by such  Investor  as a result of the sale of  Registrable  Securities
pursuant to such  Registration  Statement.  Such indemnity  shall remain in full
force and effect  regardless of any  investigation  made by or on behalf of such
Indemnified  Party and shall survive the transfer of the Registrable  Securities
by the Investors pursuant to Section 9 hereof.  Notwithstanding  anything to the
contrary  contained  herein,  the  indemnification  agreement  contained in this
Section 6(b) with respect to any preliminary  prospectus  shall not inure to the
benefit of any Indemnified Party if the untrue statement or omission of material
fact contained in the preliminary  prospectus was corrected on a timely basis in
the prospectus, as then amended or supplemented.

                  (c)  Promptly  after  receipt  by  an  Indemnified  Person  or
Indemnified  Party  under this  Section 6 of notice of the  commencement  of any
action  (including  any  governmental   action),   such  Indemnified  Person  or
Indemnified  Party shall,  if a Claim in respect  thereof is to made against any
indemnifying  party under this  Section 6, deliver to the  indemnifying  party a
written notice of the commencement  thereof,  and the  indemnifying  party shall
have the right to participate in, and, to the extent the  indemnifying  party so
desires,  jointly with any other indemnifying party similarly noticed, to assume
control  of the  defense  thereof  with  counsel  mutually  satisfactory  to the
indemnifying  party and the Indemnified  Person or the Indemnified Party, as the
case may be;  provided,  however,  that  such  indemnifying  party  shall not be
entitled to assume such defense and an Indemnified  Person or Indemnified  Party
shall have the right to retain its own counsel  with the fees and expenses to be
paid by the  indemnifying  party,  if,  in the  reasonable  opinion  of  counsel
retained by the indemnifying  party, the  representation  by such counsel of the
Indemnified  Person or  Indemnified  Party and the  indemnifying  party would be
inappropriate  due to actual or  potential  conflicts  of interest  between such
Indemnified  Person or Indemnified Party and any other party represented by such
counsel in such proceeding or the actual or potential  defendants in, or targets
of, any such action include both the Indemnified Person or the Indemnified Party
and the indemnifying  party and any such Indemnified Person or Indemnified Party
reasonably  determines  that  there  may be  legal  defenses  available  to such
Indemnified  Person or  Indemnified  Party  which  are in  conflict  with  those
available to such indemnifying  party. The indemnifying party shall pay for only
one  separate  legal  counsel  for the  Indemnified  Persons or the  Indemnified
Parties,  as  applicable,  and such legal counsel shall be selected by Investors
holding a  majority-in-interest  of the Registrable  Securities  included in the
Registration  Statement  to which the Claim  relates  (with the  approval of the
Initial  Investor  if  it  holds   Registrable   Securities   included  in  such
Registration  Statement),  if the  Investors  are  entitled  to  indemnification
hereunder,  or by the  Company,  if the Company is  entitled to  indemnification
hereunder,  as  applicable.  The  failure  to  deliver  written  notice  to  the
indemnifying  party within a  reasonable  time of the  commencement  of any such
action  shall  not  relieve  such  indemnifying  party of any  liability  to the
Indemnified  Person or  Indemnified  Party  under this  Section 6, except to the
extent  that the  indemnifying  party is actually  prejudiced  in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by  periodic   payments  of  the  amount   thereof  during  the  course  of  the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

                                       11
<PAGE>

         7. CONTRIBUTION.  To the extent any  indemnification by an indemnifying
party is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable under Section 6 to the fullest extent  permitted by law as is appropriate
to reflect the relative fault of the  indemnifying  party,  on the one hand, and
the  Indemnified  Person or Indemnified  Party, as the case may be, on the other
hand,  with  respect  to the  Violation  giving  rise to the  applicable  Claim;
provided,  however,  that (i) no contribution shall be made under  circumstances
where the maker would not have been liable for  indemnification  under the fault
standards  set  forth  in  Section  6,  (ii)  no  person  guilty  of  fraudulent
misrepresentation  (within the meaning of Section 11(f) of the  Securities  Act)
shall be entitled to contribution from any seller of Registrable  Securities who
was not  guilty of such  fraudulent  misrepresentation,  and (iii)  contribution
(together with any indemnification or other obligations under this Agreement) by
any  seller of  Registrable  Securities  shall be  limited  in amount to the net
amount of proceeds  received  by such  seller from the sale of such  Registrable
Securities.

         8. REPORTS UNDER THE EXCHANGE  ACT. With a view to making  available to
the Investors the benefits of Rule 144  promulgated  under the Securities Act or
any other  similar rule or regulation of the SEC that may at any time permit the
Investors to sell  securities of the Company to the public without  registration
("Rule 144"), the Company agrees to:

                  (a) file  with the SEC in a  timely  manner  and make and keep
available  all reports  and other  documents  required of the Company  under the
Securities  Act and the Exchange Act so long as the Company  remains  subject to
such  requirements  (it being  understood  that  nothing  herein shall limit the
Company's  obligations under Section 4(c) of the Securities  Purchase Agreement)
and the filing and  availability of such reports and other documents is required
for the applicable provisions of Rule 144; and

                  (b) furnish to each  Investor so long as such  Investor  holds
Notes, Warrants or Registrable Securities,  promptly upon request, (i) a written
statement by the Company that it has complied with the reporting requirements of
Rule 144,  the  Securities  Act and the  Exchange  Act,  (ii) a copy of the most
recent  annual or  quarterly  report of the Company  and such other  reports and
documents so filed by the Company,  and (iii) such other  information  as may be
reasonably  requested to permit the Investors to sell such securities under Rule
144 without registration.

         9.  ASSIGNMENT  OF  REGISTRATION  RIGHTS.  The rights of the  Investors
hereunder,  including  the  right  to  have  the  Company  register  Registrable
Securities pursuant to this Agreement, shall be automatically assignable by each
Investor to any  transferee of all or any portion of the Notes,  the Warrants or
the  Registrable  Securities  if: (i) the  Investor  agrees in writing  with the
transferee  or assignee to assign such rights,  and a copy of such  agreement is
furnished to the Company  after such  assignment,  (ii) the Company is furnished
with written notice of (a) the name and address of such  transferee or assignee,
and (b) the securities with respect to which such registration  rights are being
transferred  or assigned,  (iii)  following  such  transfer or  assignment,  the
further  disposition  of  such  securities  by the  transferee  or  assignee  is
restricted  under the Securities Act and applicable  state securities laws, (iv)
the  transferee or assignee  agrees in writing for the benefit of the Company to
be bound by all of the provisions  contained herein, and (v) such transfer shall
have been made in accordance with the applicable  requirements of the Securities
Purchase Agreement, the Notes and the Warrants, as applicable.  In addition, and
notwithstanding  anything  to the  contrary  contained  in this  Agreement,  the
Securities  Purchase  Agreement,  the Notes or the Warrants,  the Securities (as
defined in the Securities Purchase Agreement) may be pledged,  and all rights of
the Investors under this Agreement or any other agreement or document related to
the transactions contemplated hereby may be assigned, without further consent of
the Company,  to a bona fide pledgee in connection with an Investor's  margin or
brokerage account.

                                       12
<PAGE>

         10. AMENDMENT OF REGISTRATION RIGHTS.  Provisions of this Agreement may
be amended and the observance  thereof may be waived  (either  generally or in a
particular  instance  and  either  retroactively  or  prospectively),  only with
written consent of the Company,  the Initial Investor (to the extent the Initial
Investor still owns Notes, Warrants or Registrable Securities) and Investors who
hold a majority in interest of the  Registrable  Securities or, in the case of a
waiver,  with the written  consent of the party charged with the  enforcement of
any such provision;  provided, however, that no amendment hereto which restricts
the  ability  of an  Investor  to elect not to  participate  in an  underwritten
offering  shall be  effective  against  any  Investor  which does not consent in
writing to such amendment;  provided,  further,  however,  that no consideration
shall be paid to an  Investor  by the Company in  connection  with an  amendment
hereto  unless each Investor  similarly  affected by such  amendment  receives a
pro-rata amount of consideration from the Company.  Unless an Investor otherwise
agrees, each amendment hereto must similarly affect each Investor. Any amendment
or waiver effected in accordance with this Section 10 shall be binding upon each
Investor and the Company.

         11.  DELAY  PERIOD.  If at any  time  prior  to the  expiration  of the
Registration  Period,  the  Company  is  advised  in  writing  by  a  nationally
recognized  investment banking firm selected by the Company that, in such firm's
opinion,  sales of shares of Common Stock pursuant to the Registration Statement
at  such  time  would  materially   adversely  affect  any  immediately  planned
underwritten public equity financing by the Company having gross proceeds to the
Company of at least  $20,000,000,  the Company shall not be required to maintain
the  effectiveness  of the  Registration  Statement or amend or  supplement  the
Registration Statement for a period (a "Transaction Delay Period") commencing on
the date of pricing of such equity  financing  and expiring upon the earliest to
occur of (a) the abandonment of such financing, (b) 90 days after the completion
of such financing or (c) the termination of any "hold back" or "lock-up"  period
(not  exceeding  90 days)  obtained  by the  underwriter(s)  from any  person in
connection with such financing.  The Company will give prompt written notice, in
the manner  prescribed by Section 12(b) hereof, to the Initial Investors 30 days
in advance of the  commencement  of any  Transaction  Delay Period.  Such notice
shall  state to the  extent,  if any,  as is  practicable,  an  estimate  of the
duration  of  such  Transaction  Delay  Period.  The  Initial  Investor,  by its
acceptance  of any share of Common  Stock,  agrees  that,  upon  receipt of such
notice it will forthwith discontinue disposition of the Common Stock pursuant to
the Registration  Statement,  and will not deliver any prospectus forming a part
thereof in  connection  with any sale of Common Stock,  until the  expiration of
such Transaction  Delay Period.  Notwithstanding  anything in this Section 11 to
the contrary,  there shall not be more than one Transaction  Delay Period in any
12-month period.

         12.      MISCELLANEOUS.

                  (a) A person or entity is deemed to be a holder of Registrable
Securities  whenever  such  person or entity  owns of  record  such  Registrable
Securities.  If  the  Company  receives  conflicting  instructions,  notices  or
elections  from  two or more  persons  or  entities  with  respect  to the  same
Registrable  Securities,  the Company shall act upon the basis of  instructions,
notice  or  election  received  from the  registered  owner of such  Registrable
Securities.

                  (b) Any notices  required or  permitted  to be given under the
terms of this  Agreement  shall be sent by certified or registered  mail (return
receipt  requested)  or  delivered  personally  or by  courier  or by  confirmed
telecopy,  and shall be effective  five (5) days after being placed in the mail,
if mailed, or upon receipt or refusal of receipt, if delivered  personally or by
courier or confirmed telecopy,  in each case addressed to a party. The addresses
for such communications shall be:

                                       13
<PAGE>

               If to the Company:

               WaveRider Communications Inc.
               255 Consumers Road, Suite 500
               Toronto, Ontario, Canada MJ21R4
               Facsimile:       (416) 502-2968
               Attn:                     Scott Worthington

               with a copy simultaneously transmitted by like means to:

               Foley, Hoag & Eliot LLP
               One Post Office Square
               Boston, MA  02109-2170
               Facsimile:       (617) 832-7000
               Attn.:           David Broadwin, Esquire

and if to any Investor,  at such address as such Investor shall have provided in
writing to the Company, or at such other address as each such party furnishes by
notice given in accordance with this Section 12(b).

                  (c) Failure of any party to exercise any right or remedy under
this  Agreement or otherwise,  or delay by a party in  exercising  such right or
remedy, shall not operate as a waiver thereof.

                  (d) This  Agreement  shall be  governed  by and  construed  in
accordance  with the laws of the State of New York  applicable to contracts made
and to be performed in the State of New York. The Company  irrevocably  consents
to the  jurisdiction  of the United States  federal  courts and the state courts
located in the State of New York in any suit or  proceeding  based on or arising
under this Agreement and  irrevocably  agrees that all claims in respect of such
suit or proceeding  may be determined  in such courts.  The Company  irrevocably
waives the defense of an  inconvenient  forum to the maintenance of such suit or
proceeding. The Company further agrees that service of process upon the Company,
mailed by first class mail shall be deemed in every respect effective service of
process upon the Company in any such suit or  proceeding.  Nothing  herein shall
affect the  Investors'  right to serve process in any other manner  permitted by
law. The Company agrees that a final non-appealable judgment in any such suit or
proceeding  shall be conclusive  and may be enforced in other  jurisdictions  by
suit on such judgment or in any other lawful manner.

                  (e)  This  Agreement,   the  Securities   Purchase   Agreement
(including  all  schedules  and  exhibits  thereto),  the Notes and the Warrants
constitute  the entire  agreement  among the parties  hereto with respect to the
subject  matter  hereof  and  thereof.  There  are  no  restrictions,  promises,
warranties or undertakings, other than those set forth or referred to herein and
therein.  This Agreement,  the Securities Purchase Agreement,  the Notes and the
Warrants  supersede all prior  agreements and  understandings  among the parties
hereto with respect to the subject matter hereof and thereof.

                  (f)  Subject to the  requirements  of  Section 9 hereof,  this
Agreement  shall inure to the benefit of and be binding upon the  successors and
assigns of each of the parties hereto.

                  (g) The  headings in this  Agreement  are for  convenience  of
reference only and shall not limit or otherwise affect the meaning hereof.

                                       14
<PAGE>

                  (h)  This   Agreement   may  be   executed   in  two  or  more
counterparts,  each of which shall be deemed an original  but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile  transmission  of a copy
of this  Agreement  bearing  the  signature  of the  party  so  delivering  this
Agreement.

                  (i) Each party shall do and  perform,  or cause to be done and
performed,  all such further acts and things,  and shall execute and deliver all
such other  agreements,  certificates,  instruments and documents,  as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

                  (j) All  consents,  approvals and other  determinations  to be
made by the Investors  pursuant to this Agreement shall be made by the Investors
holding a majority in interest of the Registrable  Securities  (determined as if
all Notes and Warrants then outstanding had been converted into or exercised for
Registrable Securities) held by all Investors.

                  (k) The initial number of Registrable  Securities  included on
any  Registration  Statement  and each  increase  to the  number of  Registrable
Securities  included  thereon  shall be allocated  pro rata among the  Investors
based on the number of Registrable  Securities held by each Investor at the time
of such establishment or increase,  as the case may be. In the event an Investor
shall sell or otherwise  transfer any of such holder's  Registrable  Securities,
each  transferee  shall  be  allocated  a pro  rata  portion  of the  number  of
Registrable Securities included on a Registration Statement for such transferor.
Any shares of Common Stock included on a Registration Statement and which remain
allocated to any person or entity which does not hold any Registrable Securities
shall be allocated to the remaining  Investors,  pro rata based on the number of
shares of Registrable Securities then held by such Investors.  For the avoidance
of doubt,  the number of  Registrable  Securities  held by any Investor shall be
determined as if all Notes and Warrants then  outstanding were converted into or
exercised for Registrable Securities.

                  (l)  Each  party to this  Agreement  has  participated  in the
negotiation  and drafting of this  Agreement.  As such, the language used herein
shall be deemed to be the language chosen by the parties hereto to express their
mutual intent,  and no rule of strict  construction  will be applied against any
party to this Agreement.

                  (m) For purposes of this  Agreement,  the term  "business day"
means  any day  other  than a  Saturday  or  Sunday  or a day on  which  banking
institutions  in the  State of New  York are  authorized  or  obligated  by law,
regulation or executive order to close, and the term "trading day" means any day
on which  NASDAQ  or, if the  Common  Stock is not then  traded on  NASDAQ,  the
principal  securities  exchange or trading market where the Common Stock is then
listed or traded, is open for trading.

                                       15
<PAGE>

         IN WITNESS  WHEREOF,  the parties have caused this Agreement to be duly
executed as of the date first above written.

                                             WAVERIDER COMMUNICATIONS INC.

                                             By:_____________________________
                                           Name:
                                            Its:

                               INITIAL INVESTOR:

                                             CAPITAL VENTURES INTERNATIONAL

                                             By:_____________________________
                                           Name:
                                            Its:

                                       16
<PAGE>

                                    EXHIBIT 1

                                       to
                                  Registration

                                     Rights
                                    Agreement

                                                       [Date]
[Name and address
of transfer agent]

                           RE:      WAVERIDER COMMUNICATIONS, INC.

Ladies and Gentlemen:

         We  are  counsel  to  WaveRider   Communications  Inc.,  a  corporation
organized  under  the  laws of the  State  of  Nevada  (the  "Company"),  and we
understand that [Name of Investor] (the "Holder") has purchased from the Company
(i) Convertible  Notes that are convertible  into shares of the Company's common
stock,  par value $.001 per share (the  "Common  Stock"),  and (ii)  warrants to
acquire  shares of Common Stock.  Pursuant to a Registration  Rights  Agreement,
dated as of  __________,  2001,  by and among the  Company  and the  signatories
thereto  (the  "Registration  Rights  Agreement"),  the Company  agreed with the
Holder, among other things, to register the Registrable Securities (as that term
is defined in the  Registration  Rights  Agreement)  under the Securities Act of
1933,  as  amended  (the  "Securities  Act"),  upon the  terms  provided  in the
Registration  Rights  Agreement.  In connection  with the Company's  obligations
under  the  Registration  Rights  Agreement,  on ,  2001,  the  Company  filed a
Registration   Statement  on  Form  S-3  (File  No.  333-   _____________)  (the
"Registration  Statement")  with the  Securities  and Exchange  Commission  (the
"SEC")  relating  to the  Registrable  Securities,  which  names the Holder as a
selling  stockholder   thereunder.   The  Registration  Statement  was  declared
effective by the SEC on _____________, 200_.

 [Other customary introductory and scope of examination language to be inserted]

         Based  on the  foregoing,  we are of the  opinion  that the sale of the
Registrable Securities by the Investors has been registered under the Securities
Act.

                                     [Other customary language to be included.]

                                                              Very truly yours,

cc:   [Name of Investor]

                                       17EXHIBIT 4.8

                      KANSAS CITY SOUTHERN INDUSTRIES, INC.

                         401(k) AND PROFIT SHARING PLAN

                (AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2001)

<PAGE>

                      KANSAS CITY SOUTHERN INDUSTRIES, INC.
                         401(k) AND PROFIT SHARING PLAN
                                TABLE OF CONTENTS
                                -----------------

<TABLE>
<CAPTION>
<S>          <C>                                                                                                 <C>

Article I.   DEFINITIONS..........................................................................................2
     1.01    "Plan" ..............................................................................................2
     1.02    "Employer" ..........................................................................................2
     1.03    "Trustee" ...........................................................................................2
     1.04    "Plan Administrator" ................................................................................2
     1.05    "Advisory Committee" ................................................................................2
     1.06    "Employee" ..........................................................................................2
     1.07    "Highly Compensated Employee" .......................................................................2
     1.08    "Participant" .......................................................................................3
     1.09    "Beneficiary" .......................................................................................4
     1.10    "Compensation" ......................................................................................4
     1.11    "Account" ...........................................................................................5
     1.12    "Accrued Benefit" ...................................................................................5
     1.13    "Nonforfeitable" ....................................................................................5
     1.14    "Plan Year" .........................................................................................5
     1.15    "Effective Date" ....................................................................................5
     1.16    "Plan Entry Date" ...................................................................................5
     1.17    "Accounting Date"....................................................................................5
     1.18    "Trust" .............................................................................................5
     1.19    "Trust Fund" ........................................................................................5
     1.20    "Nontransferable Annuity" ...........................................................................5
     1.21    "ERISA" .............................................................................................5
     1.22    "Code" ..............................................................................................5
     1.23    "Service" ...........................................................................................6
     1.24    "Hour of Service" ...................................................................................6
     1.25    "Disability" ........................................................................................7
     1.26    SERVICE FOR PREDECESSOR EMPLOYER.  ..................................................................7
     1.27    RELATED EMPLOYERS.  .................................................................................7
     1.28    LEASED EMPLOYEES.  ..................................................................................8
     1.29    DETERMINATION OF TOP HEAVY STATUS.  .................................................................8
     1.30    PLAN MAINTAINED BY MORE THAN ONE EMPLOYER.  ........................................................10

ARTICLE II.  EMPLOYEE PARTICIPANTS...............................................................................10
     2.01    ELIGIBILITY.  ......................................................................................10
     2.02    YEAR OF SERVICE - PARTICIPATION.....................................................................11
     2.03    BREAK IN SERVICE - PARTICIPATION.  .................................................................11
     2.04    PARTICIPATION UPON REEMPLOYMENT.  ..................................................................11

Article III. EMPLOYER CONTRIBUTIONS AND FORFEITURES..............................................................12
     3.01    AMOUNT..............................................................................................12
     3.02    DETERMINATION OF CONTRIBUTION.  ....................................................................13
     3.03    TIME OF PAYMENT OF CONTRIBUTION.  ..................................................................13
     3.04    CONTRIBUTION ALLOCATION.............................................................................13
     3.05    FORFEITURE ALLOCATION.  ............................................................................15
     3.06    ACCRUAL OF BENEFIT.  ...............................................................................16
     3.07    LIMITATIONS ON ALLOCATIONS TO PARTICIPANTS' ACCOUNTS................................................16
     3.08    DEFINITIONS - ARTICLE III.  ........................................................................18

Article IV.  PARTICIPANT CONTRIBUTIONS...........................................................................21
     4.01    PARTICIPANT VOLUNTARY CONTRIBUTIONS.  ..............................................................21
     4.02    PARTICIPANT VOLUNTARY CONTRIBUTIONS - SPECIAL
             DISCRIMINATION TEST.  (Reserved)....................................................................21
     4.03    PARTICIPANT ROLLOVER CONTRIBUTIONS..................................................................21
     4.04    PARTICIPANT CONTRIBUTION - FORFEITABILITY...........................................................21
     4.05    PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION.  ...............................................21
     4.06    PARTICIPANT CONTRIBUTION - ACCRUED BENEFIT..........................................................22

Article V.   TERMINATION OF SERVICE - PARTICIPANT VESTING........................................................22
     5.01    NORMAL RETIREMENT AGE.  ............................................................................22
     5.02    PARTICIPANT DISABILITY OR DEATH.  ..................................................................22
     5.03    VESTING SCHEDULE.  .................................................................................22
     5.04    CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED PARTICIPANTS/RESTORATION OF FORFEITED ACCRUED BENEFIT....23
     5.05    SEGREGATED ACCOUNT FOR REPAID AMOUNT................................................................24
     5.06    YEAR OF SERVICE - VESTING.  ........................................................................25
     5.07    BREAK IN SERVICE - VESTING..........................................................................25
     5.08    INCLUDED YEARS OF SERVICE - VESTING.................................................................25
     5.09    FORFEITURE OCCURS.  ................................................................................25

Article VI.  TIME AND METHOD OF PAYMENT OF BENEFITS..............................................................25
     6.01    TIME OF PAYMENT OF ACCRUED BENEFIT.  ...............................................................25
     6.02    METHOD OF PAYMENT OF ACCRUED BENEFIT.  .............................................................27
     6.03    BENEFIT PAYMENT ELECTIONS.  ........................................................................29
     6.04    ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING
             SPOUSES.  ..........................................................................................34
     6.05    WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY.  [Reserved].................................34
     6.06    WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY.  [Reserved].......................................34
     6.07    DISTRIBUTIONS UNDER DOMESTIC RELATIONS ORDERS.  ....................................................34
     6.08    ROLLOVER DISTRIBUTIONS.  ...........................................................................35

Article VII. EMPLOYER ADMINISTRATIVE PROVISIONS..................................................................36
     7.01    INFORMATION TO COMMITTEE.  .........................................................................36
     7.02    NO LIABILITY.  .....................................................................................36
     7.03    INDEMNITY OF COMMITTEE.  ...........................................................................36
     7.04    EMPLOYER DIRECTION OF INVESTMENT.  .................................................................36
     7.05    AMENDMENT TO VESTING SCHEDULE.  ....................................................................37

Article VIII. PARTICIPANT ADMINISTRATIVE PROVISIONS..............................................................37
     8.01    BENEFICIARY DESIGNATION.  ..........................................................................37
     8.02    NO BENEFICIARY DESIGNATION.  .......................................................................38
     8.03    PERSONAL DATA TO COMMITTEE.  .......................................................................38
     8.04    ADDRESS FOR NOTIFICATION.  .........................................................................38
     8.05    ASSIGNMENT OR ALIENATION.  .........................................................................38
     8.06    NOTICE OF CHANGE IN TERMS.  ........................................................................38
     8.07    LITIGATION AGAINST THE TRUST.  .....................................................................39
     8.08    INFORMATION AVAILABLE.  ............................................................................39
     8.09    APPEAL PROCEDURE FOR DENIAL OF BENEFITS.  ..........................................................39

Article IX.  ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANT'S ACCOUNTS..................................40
     9.01    MEMBERS' COMPENSATION, EXPENSES.  ..................................................................40
     9.02    TERM.  .............................................................................................40
     9.03    POWERS.  ...........................................................................................40
     9.04    GENERAL.  ..........................................................................................40
     9.05    FUNDING POLICY.  ...................................................................................41
     9.06    MANNER OF ACTION.  .................................................................................41
     9.07    AUTHORIZED REPRESENTATIVE.  ........................................................................41
     9.08    INTERESTED MEMBER.  ................................................................................41
     9.09    INDIVIDUAL ACCOUNTS.  ..............................................................................41
     9.10    INDIVIDUAL STATEMENT.  .............................................................................41
     9.11    ACCOUNT CHARGED.  ..................................................................................42
     9.12    UNCLAIMED ACCOUNT PROCEDURE.  ......................................................................42
     9.13    INVESTMENT MANAGER.  ...............................................................................43

Article X.   [RESERVED]..........................................................................................43

Article XI.  EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION...........................................................43
     11.01   EXCLUSIVE BENEFIT.  ................................................................................43
     11.02   AMENDMENT BY EMPLOYER.  ............................................................................43
     11.03   DISCONTINUANCE.  ...................................................................................44
     11.04   FULL VESTING ON TERMINATION.  ......................................................................44
     11.05   MERGER/DIRECT TRANSFER.  ...........................................................................44
     11.06   TERMINATION.  ......................................................................................45

Article XII. PROVISIONS RELATING TO THE CODEss.401(k) ARRANGEMENT................................................46
     12.01   CODEss.401(k) ARRANGEMENT...........................................................................46
     12.02   DEFINITIONS.........................................................................................47
     12.03   ANNUAL ELECTIVE DEFERRAL LIMITATION.................................................................49
     12.04   ACTUAL DEFERRAL PERCENTAGE ("ADP") TEST.............................................................50
     12.05   NONDISCRIMINATION RULES FOR EMPLOYER MATCHING CONTRIBUTIONS/EMPLOYEE CONTRIBUTIONS.  ...............53
     12.06   MULTIPLE USE LIMITATION.  ..........................................................................57

Article XIII. MISCELLANEOUS......................................................................................57
     13.01   EVIDENCE............................................................................................57
     13.02   NO RESPONSIBILITY FOR EMPLOYER ACTION.  ............................................................58
     13.03   FIDUCIARIES NOT INSURERS.  .........................................................................58
     13.04   WAIVER OF NOTICE.  .................................................................................58
     13.05   SUCCESSORS.  .......................................................................................58
     13.06   WORD USAGE. ........................................................................................58
     13.07   STATE LAW.  ........................................................................................58
     13.08   EMPLOYMENT NOT GUARANTEED.  ........................................................................58

Article XIV. [RESERVED]..........................................................................................59

Article XV.  PARTICIPANT'S ACCOUNTS AND THEIR INVESTMENT.........................................................59
     15.01   INDIVIDUAL ACCOUNTS.  ..............................................................................59
     15.02   INVESTMENT OF ACCOUNTS.  ...........................................................................59
     15.03   PARTICIPANT ACCOUNTS - INVESTMENT PERCENTAGES.  ....................................................59
     15.04   VALUATION OF PARTICIPANTS' ACCRUED BENEFITS.  ......................................................60
     15.05   ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS.  ...........................................60
     15.06   PARTICIPANT VOTING RIGHTS - EMPLOYER STOCK.  .......................................................60

Article XVI. PROVISIONS EFFECTIVE UPON CHANGE IN CONTROL OF KCSI.................................................61
     16.01   DEFINITIONS OF "CHANGE IN CONTROL OF KCSI".  .......................................................61
     16.02   PROVISIONS EFFECTIVE UPON CHANGE IN CONTROL.  ......................................................62
     16.03   RIGHT TO AMEND ARTICLE XVI PRIOR TO CHANGE IN CONTROL
             OF KCSI.  ..........................................................................................63

Article XVII. PROVISIONS APPLICABLE TO ACCOUNTS TRANSFERRED FROM FORMER MIDSOUTH PLAN............................63
     17.01   MIDSOUTH ACCOUNTS.  ................................................................................63
     17.02   MIDSOUTH PARTICIPANT CONTRIBUTION ACCOUNTS.  .......................................................64
     17.03   METHOD OF PAYMENT OF ACCRUED BENEFIT.  .............................................................64
     17.04   TIME OF PAYMENT AND ACCRUED BENEFIT.  ..............................................................64
     17.05   BENEFIT PAYMENT ELECTIONS.  ........................................................................66
     17.06   ANNUITY DISTRIBUTIONS TO MIDSOUTH  PARTICIPANTS AND SURVIVING SPOUSES...............................68
     17.07   WAIVER ELECTION-QUALIFIED JOINT AND SURVIVOR ANNUITY................................................70
     17.08   WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY.  .................................................71
     17.09   COORDINATION WITH SURVIVOR REQUIREMENTS.  ..........................................................72
     17.10   PARTICIPANT LOANS.  ................................................................................72
     17.10   VESTING SCHEDULE FOR REPAID AMOUNTS.  ..............................................................73

Article XVIII. PROVISIONS APPLICABLE TO ACCOUNTS TRANSFERRED FROM FORMER GATEWAY PLAN............................73
     18.01   GATEWAY ACCOUNTS.  .................................................................................73
     18.02   SPECIAL WITHDRAWAL RIGHTS.  ........................................................................74
     18.03   METHOD OF PAYMENT OF ACCRUED BENEFIT.  .............................................................74
     18.04   TIME OF PAYMENT AND ACCRUED BENEFIT.  ..............................................................75
     18.05   BENEFIT PAYMENT ELECTIONS.  ........................................................................77
     18.06   ANNUITY DISTRIBUTIONS TO GATEWAY PARTICIPANTS AND
             SURVIVING SPOUSES...................................................................................79
     18.07   WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY..............................................80
     18.08   WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY....................................................81
     18.09   COORDINATION WITH SURVIVOR REQUIREMENTS.............................................................82
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                       ALPHABETICAL LISTING OF DEFINITIONS

Plan Definition                                                                                        Reference
                                                                                                      (Page Number)
<S>                                                                                           <C>

Account.....................................................................................................1.11(5)
Accounting Date.............................................................................................1.17(5)
Accrued Benefit.............................................................................................1.12(5)
Advisory Committee..........................................................................................1.05(2)
Annual Addition.........................................................................................3.08(a)(18)
Annuity Starting Date......................................................................................6.01(25)
Beneficiary.................................................................................................1.09(4)
Break in Service for Vesting Purposes......................................................................5.07(25)
Cash-Out Distribution......................................................................................5.04(23)
Code........................................................................................................1.22(5)
Codess.411 (d)(6) Protected Benefits.......................................................................11.02(43)
Compensation................................................................................................1.10(4)
Compensation for Codess.415 Purposes.....................................................................3.08(b)(18)
Compensation for Top Heavy Purposes......................................................................1.29(c)(9)
Deemed Cash-Out Rule....................................................................................5.04(C)(24)
Deferral Contributions Account..........................................................................3.04(A)(13)
Defined Contribution Plan...............................................................................3.08(g)(19)
Defined Benefit Plan....................................................................................3.08(h)(19)
Determination Date......................................................................................1.29(g)(10)
Disability..................................................................................................1.25(7)
Distribution Date .........................................................................................6.01(25)
Distribution Valuation Date ...............................................................................6.01(25)
Effective Date..............................................................................................1.15(5)
Elective Contributions......................................................................................1.10(4)
Elective Transfer.........................................................................................11.05(44)
Employee....................................................................................................1.06(2)
Employer....................................................................................................1.02(2)
Employer for Codess.415 Purposes.........................................................................3.08(d)(18)
Employer for Top Heavy Purposes.........................................................................1.29(f)(10)
Employment Commencement Date...............................................................................2.01(10)
Employer Contributions Account.............................................................................3.04(13)
ERISA.......................................................................................................1.21(5)
Excess Amount...........................................................................................3.08(e)(19)
Forfeiture Break In Service................................................................................5.08(25)
Former Gateway Plan.......................................................................................18.01(73)
Former MidSouth Plan......................................................................................17.01(63)
Gateway Accounts..........................................................................................18.01(73)
Gateway Participant.......................................................................................18.01(73)
Hardship................................................................................................6.03(E)(32)
Highly Compensated Employee.................................................................................1.07(2)
Hour of Service.............................................................................................1.24(6)
Investment Manager............................................................................9.04(i)(41); 9.13(43)
KCSI........................................................................................................1.02(2)
Key Employee.............................................................................................1.29(a)(9)
Leased Employees............................................................................................1.28(8)
Limitation Year ........................................................................................3.08(f)(19)
Maximum Permissible Amount..............................................................................3.08(c)(18)
MidSouth Accounts.........................................................................................17.01(63)
MidSouth Participant......................................................................................17.01(63)
Minimum Distribution Incidental Benefit (MDIB)..........................................................6.02(A)(28)
Non-Key Employee.........................................................................................1.29(b)(9)
Nonforfeitable..............................................................................................1.13(5)
Nontransferable Annuity.....................................................................................1.20(5)
Normal Retirement Age......................................................................................5.01(22)
Participant.................................................................................................1.08(3)
Participating Employer......................................................................................1.02(2)
Permissive Aggregation Group............................................................................1.29(e)(10)
Plan........................................................................................................1.01(2)
Plan Entry Date.............................................................................................1.16(5)
Plan Administrator..........................................................................................1.04(2)
Plan Year...................................................................................................1.14(5)
Qualified Domestic Relations Order.........................................................................6.07(34)
Qualified Matching Contributions Account...................................................................3.04(13)
Qualified Nonelective Contributions Account................................................................3.04(13)
Regular Matching Contributions Account.....................................................................3.04(13)
Related Employers...........................................................................................1.27(7)
Required Aggregation Group..............................................................................1.29(d)(10)
Required Beginning Date.................................................................................6.01(B)(26)
Rollover Account...........................................................................................4.03(21)
Rollover Contributions.....................................................................................4.03(21)
Separation from Service.....................................................................................1.23(6)
Service.....................................................................................................1.23(6)
Sponsor.....................................................................................................1.02(2)
Top Heavy Minimum Allocation............................................................................3.04(B)(14)
Top Heavy Ratio.............................................................................................1.29(8)
Trust Fund..................................................................................................1.19(5)
Trust.......................................................................................................1.18(5)
Trustee.....................................................................................................1.03(2)
Year of Service for Eligibility Purposes...................................................................2.02(11)
Year of Service for Vesting Purposes.......................................................................5.06(25)
</TABLE>

<PAGE>

                      KANSAS CITY SOUTHERN INDUSTRIES, INC.
                         401(k) AND PROFIT SHARING PLAN
                (AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2001)

                                  INTRODUCTION

         Kansas City Southern Industries,  Inc. ("KCSI") originally established,
effective  as of January 1, 1996,  the Kansas  City  Southern  Industries,  Inc.
401(k) Plan (the "401 (k) Plan"),  for the  administration  and  distribution of
contributions  made by the  Employers  for the purpose of  providing  retirement
benefits for eligible Employees.

         Immediately  prior to July 12,  2000  (the  "Spinoff  Date"),  Stilwell
Financial Inc.  ("Stilwell") and its subsidiaries  (collectively,  the "Stilwell
Group") were members of the controlled group of corporations (within the meaning
of Code ss.  414(b)) that  includes  KCSI.  As of the Spinoff  Date,  all of the
shares of Stilwell held by KCSI were  distributed to the shareholders of KCSI as
a spinoff dividend (such  transaction being referred to herein as the "Spinoff")
and the  members  of the  Stilwell  Group  thereby  ceased to be  members of the
controlled group of corporations that includes KCSI.

         As of the Spinoff  Date,  the 401(k)  Plan was split into two  separate
plans:  (1) an amended and restated  401(k) plan providing  benefits to eligible
employees  of KCSI and  certain of its  affiliates  (exclusive  of the  Stilwell
Group),  which  continued  to hold the assets of the 401(k)  Plan  allocable  to
employees and former  employees of KCSI and certain of its affiliates other than
the Stilwell Group,  and which continued to be known as the Kansas City Southern
Industries,  Inc. 401(k) Plan (the "401(k) Plan");  and (2) a newly  established
401(k) plan with a profit sharing plan component  providing benefits to eligible
employees of the Stilwell  Group,  to which were  transferred  the assets of the
401(k) Plan allocable to employees and former  employees of the Stilwell  Group,
and which is known as the Stilwell  Financial,  Inc.  401(k) and Profit  Sharing
Plan ("Stilwell Plan").

         KCSI  originally  established,  effective  as of January  1, 1990,  the
Kansas City Southern  Industries,  Inc. Profit Sharing Plan (the "Profit Sharing
Plan") for the  administration  and  distribution of  contributions  made by the
Employers  for  the  purpose  of  providing  retirement  benefits  for  eligible
Employees.  Effective as of the Spinoff Date the Profit Sharing Plan was amended
and  restated,  participants  in the Profit  Sharing Plan who were  employees or
former  employees of the Stilwell  Group ceased to actively  participate  in the
Profit  Sharing  Plan,  and the assets of the Profit  Sharing Plan  allocable to
employees and former  employees of the Stilwell  Group were  transferred  to the
profit sharing component of the Stilwell Plan.

         Effective  as of  January  1, 2001 (the  "Effective  Date")  the Profit
Sharing  Plan was merged with the 401(k) Plan,  which was amended,  restated and
renamed the Kansas City Southern Industries, Inc. 401(k) and Profit Sharing Plan
(the "Plan").

         The provisions of this Plan, as hereby  amended and restated  effective
as of the  Effective  Date,  shall  apply to an  Employee  who is employed by an
Employer  on or after  the  Effective  Date,  and to any other  Employee  who is
employed by an Employer  before the  Effective  Date and whose Account under the
Profit Sharing Plan is  transferred  to the Plan as of the Effective  Date. If a
Participant in the 401(k) Plan or the Profit Sharing Plan terminated  employment
from his last Employer prior to the Effective  Date, the benefits to which he is
entitled  shall be  determined  under the terms of the 401(k) Plan or the Profit
Sharing  Plan,  as  applicable,  as in  effect  on the  date  of the  Employee's
termination of employment, unless otherwise indicated.

ARTICLE I.
                                   DEFINITIONS

     1.01     "Plan" means the retirement plan established and continued by KCSI
as set forth herein,  designated as the "Kansas City Southern  Industries,  Inc.
401(k) and Profit Sharing Plan."

     1.02     "Employer" means Kansas City Southern Industries,  Inc. ("KCSI" or
the "Sponsor") or any other employer (a  "Participating  Employer") who with the
written consent of KCSI adopts this Plan.

     1.03     "Trustee"  means  the  Trustee  under  the  Master  Trust or any
successor in office who in writing accepts the position of Trustee.

     1.04     "Plan  Administrator"  is Kansas City  Southern  Industries,  Inc.
unless  KCSI   designates   another   person  to  hold  the   position  of  Plan
Administrator.  In addition to its other duties, the Plan Administrator has full
responsibility  for  compliance  with the reporting and  disclosure  rules under
ERISA as respects this Plan.

     1.05     "Advisory  Committee"  means the Sponsor's  Advisory  Committee as
from time to time constituted.

     1.06     "Employee" means any employee of an Employer, excluding any Leased
Employee, and excluding any individual who performs services for an Employer and
(i) is working in a classification  described as an independent contractor (even
if such person is  subsequently  determined  to be a common-law  employee of the
Employer), (ii) is paid, directly or indirectly,  through an Employer's accounts
payable  system,  or (iii)  performs  such  services  pursuant  to a contract or
agreement  which  provides  that the  person  is an  independent  contractor  or
consultant  (even if such person is  subsequently  determined to be a common-law
employee of the Employer).

     1.07     "Highly  Compensated Employee" means, for any Plan Year commencing
on or after January 1, 1997, any individual who (i) is an Employee  described in
subsection  (a)  or (b)  below,  or  (ii)  is a  former  Employee  described  in
subsection (c), below:

     (a)  An  Employee  who at any time  during  the  current  Plan  Year or the
          preceding  Plan  Year is a more than five  percent  (5%)  owner (or is
          considered as owning more than five percent (5%) within the meaning of
          Section 318 of the Code) ("5% Owner") of the Employer;

     (b)  An Employee who (i) received  Compensation  during the preceding  Plan
          Year in excess of $80,000 (in 1996,  as adjusted  in  accordance  with
          regulations and rulings under Section 414(q) of the Code), and (ii) if
          the Advisory  Committee  elects by amendment of the Plan to apply this
          clause (ii) to determine the Highly  Compensated  Employees for a Plan
          Year, for this Plan and, except as otherwise  permitted,  consistently
          for all  plans of the  Employer  whose  plan  years  begin in the same
          calendar year as such preceding Plan Year, is in the group  consisting
          of the top  twenty  percent  (20%)  of the  total  number  of  persons
          employed by the Employer when ranked on the basis of Compensation paid
          during the  preceding  Plan  Year,  provided  that,  for  purposes  of
          determining the total number of persons employed by the Employer,  the
          following Employees shall be excluded:

               (1)  Employees  who have not  completed  an  aggregate of six (6)
          months of service during the preceding Plan Year,

               (2) Employees who work less than seventeen and one-half  (17-1/2)
          hours  per  week for 50% or more of the  total  weeks  worked  by such
          employees during the preceding Plan Year,

               (3)  Employees  who  normally  work  during not more than six (6)
          months during any year,

               (4)  Employees  who  have not  attained  age 21 by the end of the
          preceding Plan Year,

               (5)  Employees  who are  nonresident  aliens  and who  receive no
          earned  income  (within the meaning of Section  911(d)(2) of the Code)
          from the Employer which  constitutes  income during the preceding Plan
          Year from  sources  within the United  States  (within  the meaning of
          Section 861(a)(3) of the Code), and

               (6) Except to the extent  provided in  regulations  prescribed by
          the  Secretary  of  the  Treasury,  Employees  who  are  members  of a
          collective  bargaining  unit  represented  by a collective  bargaining
          agent with which an Employer has or has had a bargaining agreement.

                  For  purposes  of  this  Section  1.07,  "Compensation"  means
         Compensation as defined in Section 1.10 and  Compensation  must include
         Elective Contributions.

                  The Advisory Committee must make the determination of who is a
         Highly Compensated Employee, including the determinations of the number
         and identity of the top paid 20% group and the  relevant  Compensation,
         consistent with Code ss.414(q) and  regulations  issued under that Code
         section.  The Employer may make a calendar  year  election to determine
         the Highly  Compensated  Employees  for the Plan Year, as prescribed by
         Treasury  regulations.  Except as otherwise permitted,  a calendar year
         election must apply to all plans and arrangements of the Employer.

               (c) The term  "Highly  Compensated  Employee"  also  includes any
          former Employee who separated from Service (or has a deemed Separation
          from Service,  as determined under Treasury  regulations) prior to the
          Plan Year,  performs no Service for the Employer during the Plan Year,
          and was a Highly  Compensated  Employee either for the separation year
          or any Plan Year ending on or after his 55th birthday.

     1.08  "Participant"  is an  Employee  who is  eligible  to be and becomes a
Participant in accordance with the provisions of Section 2.01.

     1.09  "Beneficiary"  is a person  designated by a Participant who is or may
become entitled to a benefit under the Plan. A Beneficiary who becomes  entitled
to a benefit  under  the Plan  remains a  beneficiary  under the Plan  until the
Trustee has fully distributed his benefit to him. A Beneficiary's  right to (and
the Plan  Administrator's,  the  Advisory  Committee's  or a  Trustee's  duty to
provide to the  Beneficiary)  information  or data  concerning the Plan does not
arise until he first becomes entitled to receive a benefit under the Plan.

     1.10   "Compensation"   means,   effective  as  of  January  1,  1997,  the
Participant's wages,  salaries,  fees for professional service and other amounts
received for personal  services  actually  rendered in the course of  employment
with  the  Employer  maintaining  the Plan as  defined  in Code  ss.3401(a)  for
purposes of income tax  withholding at the source but determined  without regard
to any rules that limit  remuneration  included  in wages based on the nature or
location of the employment or the services  performed (such as the exception for
agricultural   labor   in   ss.3401(a)(2)).   Compensation   includes   Elective
Contributions  made  by  the  Employer  on  the  Employee's  behalf.   "Elective
Contributions"  are amounts  excludible  from the Employee's  gross income under
Code ss.ss.125, ss.402(a)(8), 402(h) or 403(b), and contributed by the Employer,
at the  Employee's  election,  to a Code  ss.401(k)  arrangement,  a  simplified
employee  pension,  cafeteria  plan or  tax-sheltered  annuity.  A  Compensation
payment  includes  Compensation  paid by the  Employer  to an  Employee  through
another person under the common paymaster  provisions of Code  ss.ss.3121(s) and
3306(p).

     Any reference in this Plan to Compensation is a reference to the definition
in this Section 1.10, unless the Plan reference specifies a modification to this
definition.  The Advisory  Committee  will take into  account only  Compensation
actually paid for the relevant period.

     In  addition to other  applicable  limitations  set forth in the Plan,  and
notwithstanding  any other  provision  of the Plan to the  contrary,  the annual
Compensation of each Employee taken into account under the Plan shall not exceed
the OBRA 93 annual  compensation limit. The OBRA 93 annual compensation limit is
$150,000, as adjusted by the Commissioner for increases in the cost of living in
accordance with Code ss.401(a)(17)(B).  The cost-of-living  adjustment in effect
for a calendar year applies to any period,  not exceeding 12 months,  over which
Compensation  is determined  (determination  period)  beginning in such calendar
year. If a determination  period  consists of fewer than 12 months,  the OBRA 93
annual  compensation  limit will be multiplied  by a fraction,  the numerator of
which is the number of months in the determination  period,  and the denominator
of which is 12.

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

     Any reference in this Plan to the limitation under Code ss.401(a)(17) shall
mean the OBRA 93 annual compensation limit set forth in this provision.

     NONDISCRIMINATION.   For   purposes   of   determining   whether  the  Plan
discriminates  in favor of  Highly  Compensated  Employees,  Compensation  means
Compensation  as defined in this  Section  1.10,  unless  KCSI  elects to use an
alternate  nondiscriminatory  definition, in accordance with the requirements of
Code  ss.414(s) and the  regulations  issued under that Code  section.  KCSI may
elect to include all  Elective  Contributions  made by the Employer on behalf of
the  Employees.  KCSI's  election  to  include  Elective  Contributions  must be
consistent  and uniform with respect to Employees  and all plans of the Employer
for any particular  Plan Year.  KCSI may make this election to include  Elective
Contributions for  nondiscrimination  testing purposes,  irrespective of whether
this Section 1.10 includes  Elective  Contributions in the general  Compensation
definition applicable to the Plan.

     1.11 "Account" means the separate  account(s) which the Advisory  Committee
or the Trustee maintains for a Participant under the Plan.

     1.12  "Accrued  Benefit"  means  the  amount  standing  in a  Participant's
Account(s) as of any date derived from both Employer  contributions and Employee
contributions, if any.

     1.13 "Nonforfeitable" means a Participant's or Beneficiary's  unconditional
claim,  legally  enforceable  against  the Plan,  to the  Participant's  Accrued
Benefit.

     1.14 "Plan Year" means the fiscal year of the Plan, a 12 consecutive  month
period ending every December 31.

     1.15 "Effective Date" of this amended and restated Plan is January 1, 2001.

     1.16 "Plan Entry Date" means every January 1 and July 1.

     1.17 "Accounting  Date" is the last day of the Plan Year.  Unless otherwise
specified in the Plan, the Advisory Committee will make all the Plan allocations
for a particular Plan Year as of the Accounting Date of that Plan Year.

     1.18  "Trust"  means the Master  Trust  established  pursuant to the Master
Trust Agreement  between KCSI and UMB Bank, N.A. and/or any other Trust that may
be established under this Plan.

     1.19 "Trust  Fund" means all property of every kind held or acquired by the
Trustee under the Plan, other than incidental  benefit  insurance  contracts.  A
single Master Trust has been established for all Employers  participating  under
the Kansas City Southern  Industries,  Inc.  401(k) Plan.  However,  the Trustee
shall  maintain  separate  records of account in order to reflect  properly each
Participant's Accrued Benefit derived from each Participating Employer.

     1.20 "Nontransferable Annuity" means an annuity which by its terms provides
that it may not be sold, assigned,  discounted, pledged as collateral for a loan
or  security  for the  performance  of an  obligation  or for any purpose to any
person other than the insurance company.  If the Trustee  distributes an annuity
contract, the contract must be a Nontransferable Annuity.

     1.21 "ERISA" means the Employee  Retirement Income Security Act of 1974, as
amended.

     1.22 "Code" means the Internal Revenue Code of 1986, as amended.

     1.23  "Service"  means any period of time the  Employee is in the employ of
the Employer, including any period the Employee is on an unpaid leave of absence
authorized by the Employer under a uniform,  nondiscriminatory policy applicable
to all  Employees.  Notwithstanding  any provision of this Plan to the contrary,
contributions,  benefits and service  credit with respect to qualified  military
service  shall be  provided  in  accordance  with  Section  414(u)  of the Code.
"Separation  from  Service"  means a  separation  from Service with the Employer
maintaining this Plan.

     1.24 "Hour of Service" means:

     (a)  Each Hour of  Service  for  which the  Employer,  either  directly  or
          indirectly, pays an Employee, or for which the Employee is entitled to
          payment, for the performance of duties. The Advisory Committee credits
          Hours of Service  under this  paragraph  (a) to the  Employee  for the
          computation   period  in  which  the  Employee  performs  the  duties,
          irrespective of when paid;

     (b)  Each Hour of  Service  for back pay,  irrespective  of  mitigation  of
          damages,  to which the  Employer  has agreed or for which the Employee
          has received an award. The Advisory Committee credits Hours of Service
          under this paragraph (b) to the Employee for the computation period(s)
          to which  the  award or the  agreement  pertains  rather  than for the
          computation  period in which the award,  agreement or payment is made;
          and

     (c)  Each Hour of  Service  for  which the  Employer,  either  directly  or
          indirectly, pays an Employee, or for which the Employee is entitled to
          payment  (irrespective  of  whether  the  employment  relationship  is
          terminated),  for  reasons  other than for the  performance  of duties
          during a  computation  period,  such as leave  of  absence,  vacation,
          holiday,  sick  leave,  illness,  incapacity  (including  disability),
          layoff, jury duty or military duty. The Advisory Committee will credit
          no more than 501  Hours of  Service  under  this  paragraph  (c) to an
          Employee on account of any single  continuous  period during which the
          Employee  does not  perform  any duties  (whether  or not such  period
          occurs during a single  computation  period).  The Advisory  Committee
          credits Hours of Service under this  paragraph (c) in accordance  with
          the rules of paragraphs (b) and (c) of Labor Reg.ss.2530.200b-2, which
          the Plan, by this reference,  specifically incorporates in full within
          this paragraph (c).

     The Advisory  Committee  will not credit an Hour of Service under more than
one of the above paragraphs.  A computation  period for purposes of this Section
1.24 is the Plan Year, Year of Service period,  Break in Service period or other
period, as determined under the Plan provision for which the Advisory  Committee
is measuring an Employee's Hours of Service.

     The Employer will credit every  Employee with Hours of Service on the basis
of the  "actual"  method.  For purposes of the Plan,  "actual"  method means the
determination  of Hours of Service  from  records of hours  worked and hours for
which the Employer  makes payment or for which payment is due from the Employer.
However,  for an Employee  who is paid on other than an hourly  basis,  Hours of
Service  shall be credited  according to the  following  schedule,  based on the
payroll period of the Employee, for each payroll period with respect to which he
or she is paid or is entitled to payment of compensation:

       PAYROLL PERIOD                              HOURS OF SERVICE

       Daily                                             10
       Weekly                                            45
       Bi-Monthly                                        95
       Monthly                                           190

     Solely for purposes of determining  whether the Employee  incurs a Break in
Service under any  provision of this Plan,  the Advisory  Committee  must credit
Hours of Service during an Employee's  unpaid absence period due to maternity or
paternity  leave. The Advisory  Committee  considers an Employee on maternity or
paternity  leave if the Employee's  absence is due to the Employee's  pregnancy,
the birth of the Employee's child, the placement with the Employee of an adopted
child,  or the care of the Employee's  child  immediately  following the child's
birth or placement.  The Advisory  Committee credits Hours of Service under this
paragraph  on the basis of the number of Hours of  Service  the  Employee  would
receive if he were paid during the absence period or, if the Advisory  Committee
cannot  determine the number of Hours of Service the Employee would receive,  on
the basis of 8 hours per day during the absence period.  The Advisory  Committee
will credit only the number (not exceeding 501) of Hours of Service necessary to
prevent an Employee's Break in Service. The Advisory Committee credits all Hours
of Service  described in this paragraph to the  computation  period in which the
absence  period  begins or, if the Employee does not need these Hours of Service
to  prevent a Break in Service in the  computation  period in which his  absence
period  begins,  the Advisory  Committee  credits  these Hours of Service to the
immediately following computation period.

     1.25  "Disability"  means the Participant,  because of a physical or mental
disability,  will be unable to perform the duties of his  customary  position of
employment (or is unable to engage in any substantial  gainful  activity) for an
indefinite  period  which  the  Advisory  Committee  considers  will  be of long
continued  duration.  A Participant  also is disabled if he incurs the permanent
loss or loss of use of a member  or  function  of the  body,  or is  permanently
disfigured,  and  incurs  a  Separation  from  Service.  The  Plan  considers  a
Participant   disabled  on  the  date  the  Advisory  Committee  determines  the
Participant  satisfies the definition of disability.  The Advisory Committee may
require a Participant  to submit to a physical  examination  in order to confirm
disability.  The Advisory  Committee  will apply the  provisions of this Section
1.25 in a nondiscriminatory, consistent and uniform manner.

     1.26 SERVICE FOR PREDECESSOR  EMPLOYER.  If the Employer maintains the plan
of a  predecessor  employer,  the Plan treats  service of the Employee  with the
predecessor employer as service with the Employer.

     1.27  RELATED  EMPLOYERS.   A  related  group  is  a  controlled  group  of
corporations  (as defined in Code ss.414(b)),  trades or businesses  (whether or
not incorporated)  which are under common control (as defined in Code ss.414(c))
or an  affiliated  service  group  (as  defined  in  Code  ss.414(m)  or in Code
ss.414(o)).  If the Employer is a member of a related group, the term "Employer"
includes,  for the time period  during  which the relation  exists,  the related
group members for purposes of crediting Hours of Service,  determining  Years of
Service and Breaks in Service under Articles II and V, applying the  limitations
on  allocations  in Part 2 of Article III,  applying the top heavy rules and the
minimum  allocation  requirements  of Article III, the  definitions of Employee,
Highly Compensated Employee, Compensation and Leased Employee, and for any other
purpose  required by the  applicable  Code  section or by a Plan  provision.  In
addition,  (i) the Plan shall treat all service prior to the Effective Date that
is credited  with  respect to an Employee  under the terms of the Plan in effect
prior to the  Effective  Date as service  with the  Employer,  and (ii) the Plan
shall  treat  service  of an  Employee  on or after the  Effective  Date with an
"affiliate"  of KCSI during the time it is an  "affiliate"  as service  with the
Employer.   For  purposes  of  the  immediately  preceding  sentence,  the  term
"affiliate" means any corporation,  partnership, joint venture or other business
entity with  respect to which  twenty-five  percent  (25%) or more of the equity
interests therein are owned,  directly or indirectly,  by KCSI, or by any entity
at least 80% of the equity interests of which are owned by KCSI. However, only a
Participating  Employer described in Section 1.02 may contribute to the Plan and
only an Employee employed by a Participating  Employer described in Section 1.02
is  eligible  to  participate  in  this  Plan.  For  Plan  allocation  purposes,
"Compensation"  does not include  compensation  received from a related employer
that is not participating in this Plan.

     1.28  LEASED  EMPLOYEES.  The Plan does not treat a Leased  Employee  as an
Employee of the Employer.  A Leased  Employee is an individual (who otherwise is
not an Employee of the Employer) who,  pursuant to a leasing  agreement  between
the Employer and any other person,  has performed  services for the Employer (or
for the Employer and any persons  related to the Employer  within the meaning of
Code  ss.144(a)(3)) on a substantially full time basis for at least one year and
who performs services under the primary direction or control of the Employer.  A
Leased Employee who performs services for the Employer pursuant to a contract or
agreement  which  provides that the person is a Leased  Employee will not become
eligible to  participate in this Plan merely by reason of a  determination  that
the  person is a  common-law  employee  of the  Employer,  unless  and until the
Employer changes the employment classification of such person.

     1.29  DETERMINATION OF TOP HEAVY STATUS. If this Plan is the only qualified
plan  maintained by the  Employer,  the Plan is top heavy for a Plan Year if the
top heavy ratio as of the Determination Date exceeds 60%. The top heavy ratio is
a fraction,  the  numerator of which is the sum of the present  value of Accrued
Benefits of all Key Employees as of the  Determination  Date and the denominator
of which is a similar sum determined for all Employees.  The Advisory  Committee
must  include in the top heavy  ratio,  as part of the present  value of Accrued
Benefits,  any contribution not made as of the Determination Date but includible
under Code ss. 416 and the applicable  Treasury  regulations,  and distributions
made within the Determination  Period. The Advisory Committee must calculate the
top heavy ratio by disregarding the Accrued Benefit (and distributions,  if any,
of the Accrued Benefit) of any Non-Key Employee who was formerly a Key Employee,
and by disregarding the Accrued Benefit (including distributions, if any, of the
Accrued  Benefit) of an individual who has not received  credit for at least one
Hour of Service with the Employer during the Determination  Period. The Advisory
Committee must  calculate the top heavy ratio,  including the extent to which it
must take into account  distributions,  rollovers and  transfers,  in accordance
with Code ss. 416 and the regulations under that Code section.

     If the Employer  maintains other  qualified  plans  (including a simplified
employee pension plan), or maintained another such plan which now is terminated,
this Plan is top heavy only if it is part of the Required Aggregation Group, and
the top heavy ratio for the Required  Aggregation  Group and for the  permissive
Aggregation  Group,  if any,  each  exceeds 60%.  The  Advisory  Committee  will
calculate  the top  heavy  ratio in the same  manner  as  required  by the first
paragraph  of this  Section  1.29,  taking  into  account  all plans  within the
Aggregation  Group. To the extent the Advisory  Committee must take into account
distributions   to  a   Participant,   the  Advisory   Committee   must  include
distributions  from a terminated plan which would have been part of the Required
Aggregation  Group  if it were  in  existence  on the  Determination  Date.  The
Advisory  Committee will  calculate the present value of Accrued  Benefits under
defined benefit plans or simplified  employee  pension plans included within the
group  in  accordance  with  the  terms of  those  plans,  Code ss.  416 and the
regulations under that Code section.  If a Participant in a defined benefit plan
is a Non-Key Employee, the Advisory Committee will determine his Accrued Benefit
under the accrual method,  if any, which is applicable  uniformly to all defined
benefit plans  maintained by the Employer or, if there is no uniform method,  in
accordance  with the slowest  accrual rate permitted  under the fractional  rule
accrual  method  described in Code ss.  411(b)(1)(C).  To calculate  the present
value of benefits from a defined  benefit plan, the Advisory  Committee will use
the  actuarial  assumptions  (interest  and  mortality  only)  prescribed by the
defined  benefit  plan(s)  to  value  benefits  for top  heavy  purposes.  If an
aggregated plan does not have a valuation date coinciding with the Determination
Date, the Advisory  Committee must value the Accrued  Benefits in the aggregated
plan as of the most recent valuation date falling within the twelve-month period
ending on the Determination Date, except as Code ss. 416 and applicable Treasury
regulations  require  for the first and  second  plan year of a defined  benefit
plan.  The Advisory  Committee will calculate the top heavy ratio with reference
to the Determination Dates that fall within the same calendar year.

     DEFINITIONS. For purposes of applying the provisions of this Section 1.29:

          (a) "Key Employee" means, as of any  Determination  Date, any Employee
     or former  Employee (or  Beneficiary of such  Employee),  who, for any Plan
     Year in the Determination  Period: (i) has Compensation in excess of 50% of
     the dollar amount  prescribed in  Codess.415(b)(1)(A)  (relating to defined
     benefit plans) and is an officer of the Employer;  (ii) has Compensation in
     excess of the dollar amount prescribed in Codess.415(c)(1)(A)  (relating to
     defined  contribution  plans)  and is one of the  Employees  owning the ten
     largest  interests  in the  Employer;  (iii) is a more than 5% owner of the
     Employer;  or  (iv)  is a more  than  1%  owner  of the  Employer  and  has
     compensation  of more than $150,000.  The  constructive  ownership rules of
     Codess.318  (or  the  principles  of  that  section,  in  the  case  of  an
     unincorporated Employer) will apply to determine ownership in the Employer.
     The number of officers  taken into account under clause (i) will not exceed
     the  greater  of 3 or 10% of the total  number  (after  application  of the
     Codess.414(q)(8)  exclusions)  of Employees,  but no more than 50 officers.
     The Advisory Committee will make the determination of who is a Key Employee
     in accordance with  Codess.416(i)(1)  and the  regulations  under that Code
     section.

          (b) "Non-Key Employee" is an Employee who does not meet the definition
     of Key Employee.

          (c) "Compensation" means Compensation as determined under Section 1.07
     (relating to the Highly Compensated Employee definition).

          (d) "Required Aggregation Group" means: (1) each qualified plan of the
     Employer in which at least one Key Employee participates at any time during
     the Determination  Period; and (2) any other qualified plan of the Employer
     which enables a plan  described in clause (1) to meet the  requirements  of
     Code ss.401(a)(4) or Code ss.410.

          (e) "Permissive  Aggregation Group" is the Required  Aggregation Group
     plus any other qualified plans maintained by the Employer, but only if such
     group would satisfy in the aggregate the requirements of Code  ss.401(a)(4)
     and Code ss.410.  The Advisory  Committee  will  determine  the  Permissive
     Aggregative Group.

          (f)  "Employer"  means  the  Employer  that  adopts  this Plan and any
     related employers described in Section 1.27.

          (g)  "Determination  Date" for any Plan Year is the Accounting Date of
     the preceding Plan Year or, in the case of the first Plan Year of the Plan,
     the Accounting  Date of that Plan Year. The  "Determination  Period" is the
     5-year period ending on the Determination Date.

     1.30 PLAN  MAINTAINED BY MORE THAN ONE EMPLOYER.  If more than one Employer
maintains  this Plan,  then for  purposes  of  determining  Service and Hours of
Service,  the Advisory Committee will treat all Employers  maintaining this Plan
as a single employer.

     PLAN  ALLOCATIONS.  The  Advisory  Committee  and the Trustee  will account
separately for each  Employer's  contributions  under the Plan. In this respect,
the Advisory  Committee  will  allocate  each  Employer's  contributions  to the
Trustee for a Plan Year,  in  accordance  with  Article  III, to the Accounts of
those Participants  actually employed by that Employer during the Plan Year. The
Advisory  Committee  will attribute  Participant  forfeitures to the Employer or
Employers  that actually  employed the forfeited  Participant in the year of the
forfeiture.  For this purpose,  Compensation  will mean Compensation paid during
the Plan Year to those  Participants  actually  employed by that Employer during
the Plan Year.

                                  ARTICLE II.
                              EMPLOYEE PARTICIPANTS

     2.01 ELIGIBILITY. Each Employee (other than an Excluded Employee) becomes a
Participant  in the  Plan on the Plan  Entry  Date (if  employed  on that  date)
coincident   with  or   immediately   following  the  later  of  his  Employment
Commencement  Date  or the  date he  attains  age 18.  Each  Employee  who was a
Participant  in the 401(k) Plan or the Profit Sharing Plan on the day before the
Effective  Date and who continues as an Employee on the Effective Date continues
as a  Participant  in the  Plan on the  Effective  Date.  The  term  "Employment
Commencement  Date" means the date on which the Employee  first performs an Hour
of Service for an Employer.

     An Employee is an Excluded  Employee if he is (a) a  nonresident  alien who
receives no earned  income  (within the  meaning of Code  ss.911(d)(2))  from an
Employer which constitutes  income from sources within the United States (within
the meaning of Code  ss.861(a)(3)),  or (b) a member of a collective  bargaining
unit, unless the collective bargaining agreement provides otherwise. An Employee
is a member  of a  collective  bargaining  unit if he is  included  in a unit of
employees  covered by an  agreement  which the  Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and one or more
Employers if there is evidence that retirement benefits were the subject of good
faith  bargaining  between such  employee  representatives  and such Employer or
Employers. The term "employee  representatives" does not include an organization
more than one half the members of which are owners,  officers or  executives  of
the Employer.

     If a Participant  has not incurred a Separation from Service but becomes an
Excluded  Employee,  then  during the period such a  Participant  is an Excluded
Employee,  the Advisory Committee will limit that  Participant's  sharing in the
allocation of Employer contributions and Participant forfeitures,  if any, under
the Plan by  disregarding  his  Compensation  paid by the  Employer for services
rendered in his capacity as an Excluded Employee. However, during such period of
exclusion,  the  Participant,   without  regard  to  employment  classification,
continues to receive  credit for vesting  under Article V for each included Year
of Service and the Participant's  Account continues to share fully in Trust Fund
allocations under Section 15.05.

     If an Excluded Employee who is not a Participant becomes eligible to
participate in the Plan by reason of a change in employment  classification,  he
will  participate in the Plan  immediately  if he has satisfied the  eligibility
conditions of Section 2.01 and would have been a Participant  had he not been an
Excluded Employee during his period of Service. Furthermore, the Plan takes into
account all of the Participant's  included Years of Service with the Employer as
an Excluded Employee for purposes of vesting credit under Article V.

     A Leased  Employee  who performs  services  for the Employer  pursuant to a
contract or agreement  which provides that the person is a Leased  Employee will
not  become  eligible  to  participate  in  this  Plan  merely  by  reason  of a
determination that the person is a common-law  employee of the Employer,  unless
and until the Employer changes the employment  classification of such person. If
a Leased  Employee who is not a Participant  becomes  eligible to participate in
the Plan by reason of a change in employment classification, he will participate
in the Plan  immediately  if he has  satisfied  the  eligibility  conditions  of
Section 2.01 and would have been a Participant had he not been a Leased Employee
during his period of Service.  Furthermore,  the Plan takes into  account all of
the  Participant's  included  Years of  Service  with the  Employer  as a Leased
Employee for purposes of vesting credit under Article V.

     2.02  YEAR OF  SERVICE  -  PARTICIPATION.  For  purposes  of an  Employee's
participation  in the Plan  under  Section  2.01,  the Plan  does not  apply any
minimum Hour of Service  requirement.  The Plan does not require an Employee who
terminates  employment  to  establish  a new  Employment  Commencement  Date  if
re-employed by the Employer.

     2.03 BREAK IN SERVICE - PARTICIPATION. For purposes of participation in the
Plan, the Plan does not apply any Break in Service rule.

     2.04  PARTICIPATION  UPON  REEMPLOYMENT.  A  Participant  whose  employment
terminates  reenters the Plan as a Participant on the date of his  reemployment.
An Employee who satisfies the Plan's  eligibility  conditions but who terminates
employment prior to becoming a Participant  becomes a Participant in the Plan on
the later of the Plan Entry Date on which he would have  entered the Plan had he
not  terminated  employment  or the date of his  reemployment.  Any Employee who
terminates  employment  prior to satisfying  the Plan's  eligibility  conditions
becomes a Participant in accordance with the provisions of Section 2.01.

                                  ARTICLE III.
                     EMPLOYER CONTRIBUTIONS AND FORFEITURES

PART 1.  AMOUNT OF EMPLOYER CONTRIBUTIONS AND PLAN ALLOCATIONS:
SECTIONS 3.01 THROUGH 3.06.

3.01     AMOUNT.

     (A) CONTRIBUTION FORMULA. For each Plan Year, the Employer shall contribute
to the Trust the following amounts:

               DEFERRAL CONTRIBUTIONS. The amount by which the Participants have
          elected to reduce their Compensation (as defined in Section 1.10 after
          modification  by Section  12.01) for the Plan Year under their  salary
          reduction agreements on file with the Advisory Committee.

               EMPLOYER MATCHING CONTRIBUTIONS.  An amount equal to 100% of each
          Participant's eligible contributions.  The Employer will determine the
          amount of its matching contributions by disregarding  Participants not
          entitled to an allocation of matching contributions.  The Employer, in
          its sole discretion,  may designate all or any portion of its matching
          contribution as a qualified matching contribution at the time it makes
          the contribution.

               DISCRETIONARY PROFIT SHARING CONTRIBUTION.  The additional amount
          the Employer may from time to time deem  advisable and designates as a
          discretionary profit sharing  contribution.  The Employer, in its sole
          discretion,  may  designate  all or any  portion of its  discretionary
          profit sharing contribution as a qualified nonelective contribution at
          the time it makes the contribution.

     The Employer shall make its  contribution  under the Plan  irrespective  of
whether it has net profits.  Although the Employer may  contribute  to this Plan
irrespective of whether it has net profits, the Employer intends this plan to be
a profit  sharing plan for all purposes  under the Code.  The Employer shall not
make  a  contribution  to the  Trust  for  any  Plan  Year  to  the  extent  the
contribution would exceed the Participants'  "Maximum  Permissible Amount" under
Section 3.08.

     ELIGIBLE   CONTRIBUTIONS.   Under  the  matching  contribution  formula,  a
Participant's "eligible  contributions" are the deferral contributions allocated
to the Participant  not in excess of 3% of the  Participant's  Compensation  (as
defined in Section 1.10 after  modification by Section 12.01) for the Plan Year.
Eligible  contributions  do not include deferral  contributions  that are excess
deferrals under Section 12.03.  For this purpose:  (a) excess  deferrals  relate
first to deferral  contributions for the Plan Year not otherwise  eligible for a
matching  contribution;  and (b) if the Plan Year is not a  calendar  year,  the
excess  deferrals  for a Plan Year are the last  deferrals  made for a  calendar
year.

     (B) RETURN OF CONTRIBUTIONS. The Employer contributes to this Plan on the
condition  its  contribution  is not due to a mistake  of fact and the  Internal
Revenue  Service will not  disallow  the  deduction  for its  contribution.  The
Trustee, upon written request from the Employer, must return to the Employer the
amount of the Employer's contribution made by the Employer by mistake of fact or
the amount of the Employer's  contribution  disallowed as a deduction under Code
ss.404.  The Trustee will not return any portion of the Employer's  contribution
under the provisions of this paragraph more than one year after:

          (a)  The Employer made the contribution by mistake of fact; or

          (b)  The  disallowance of the  contribution  as a deduction,  and then
               only to the extent of the disallowance.

     The  Trustee  will not  increase  the amount of the  Employer  contribution
returnable  under  this  Section  3.01  for  any  earnings  attributable  to the
contribution, but the Trustee will decrease the Employer contribution returnable
for any losses  attributable  to it. The Trustee  may  require  the  Employer to
furnish it whatever  evidence the Trustee deems  necessary to enable the Trustee
to confirm  the amount the  Employer  has  requested  be  returned  is  properly
returnable under ERISA.

     3.02  DETERMINATION  OF  CONTRIBUTION.  The  Employer,  from  its  records,
determines the amount of any  contributions  to be made by it to the Trust under
the terms of the Plan.

     3.03 TIME OF PAYMENT OF CONTRIBUTION. The Employer may pay its contribution
for each Plan Year in one or more installments  without  interest.  The Employer
must make its  contribution  to the Trust within the time prescribed by the Code
or   applicable   Treasury   regulations.   The  Employer   must  make  deferral
contributions  to the Trust,  to the extent made  pursuant  to salary  reduction
agreements,   within  an  administratively   reasonable  period  of  time  after
withholding the corresponding  Compensation  from the Participant.  The Employer
also must make deferral contributions and qualified nonelective contributions no
later than the time prescribed by the Code or by Treasury regulations.  Deferral
contributions  are  Employer  contributions  for all  purposes  under this Plan,
except to the extent the Code or Treasury  regulations prohibit the use of these
contributions to satisfy the qualification requirements of the Code.

3.04     CONTRIBUTION ALLOCATION.
--------------------------------

     (A) METHOD OF ALLOCATION.  To make allocations under the Plan, the Advisory
Committee must establish a Deferral  Contributions  Account,  a Regular Matching
Contributions  Account, a Qualified Matching  Contributions Account, a Qualified
Nonelective Contributions Account and a Profit Sharing Contributions Account for
each Participant.

     DEFERRAL  CONTRIBUTIONS.  The  Advisory  Committee  will  allocate  to each
Participant's  Deferral  Contributions  Account the deferral  contributions  the
Employer makes to the Trust on behalf of the Participant. The Advisory Committee
will make this  allocation  as of each date  during  the Plan Year on which such
Participant is paid.

     MATCHING  CONTRIBUTIONS.  The Employer,  at the time of contribution,  must
designate  which portion,  if any, of its matching  contribution is allocable to
the  Qualified  Matching  Contributions  Accounts  and which  part,  if any,  is
allocable to the Regular Matching Contributions Accounts. The Advisory Committee
will allocate the matching  contributions to the Regular Matching  Contributions
Account of the Participant on whose behalf the Employer makes that  contribution
as of the  last day of the  Plan  Year;  provided,  however,  that the  Advisory
Committee will make tentative interim  allocations of matching  contributions to
the Regular  Matching  Contributions  Account of the Participant on whose behalf
the  Employer  makes the  contribution  as of each date  during the Plan Year on
which  such  Participant  is paid,  and shall make a final  allocation  upon the
earlier of the Participant's  termination of employment with the Employer or the
last day of the Plan Year equal to the amount of matching  contribution required
under Section 3.01(A) less any interim  allocations  made to such  Participant's
Regular Matching Contributions Account during the Plan Year.

     To the extent the Employer  makes  qualified  matching  contributions,  the
Advisory  Committee will allocate the qualified  matching  contributions  to the
Qualified Matching  Contributions Account of the Participant on whose behalf the
Employer makes the contribution.

     QUALIFIED  NONELECTIVE  CONTRIBUTIONS.  If the  Employer,  at the  time  of
contribution,   designates  a  contribution   to  be  a  qualified   nonelective
contribution  for the Plan Year,  the  Advisory  Committee  will  allocate  that
qualified nonelective  contribution to the Qualified  Nonelective  Contributions
Account  of  each   Participant  in  the  same  ratio  that  the   Participant's
Compensation  for  the  Plan  Year  bears  to  the  total  Compensation  of  all
Participants for the Plan Year.

     DISCRETIONARY PROFIT SHARING CONTRIBUTIONS.  Subject to Section 3.04(B) and
any restoration  allocation  required under Section 5.04, the Advisory Committee
will  allocate  and credit each annual  Employer  discretionary  profit  sharing
contribution,  if any, other than  discretionary  profit  sharing  contributions
which,  at the  time of  contribution,  the  Employer  designates  as  qualified
nonelective  contributions,  to the Profit Sharing Contributions Account of each
Participant  who satisfies the conditions of Section 3.06 in the same ratio that
each   Participant's   Compensation  for  the  Plan  Year  bears  to  the  total
Compensation of all such Participants for the Plan Year.

          (B)  TOP HEAVY MINIMUM ALLOCATION.

               (1)  MINIMUM  ALLOCATION.  If the  Plan is top  heavy in any Plan
                    Year:

               (a) Each Non-Key  Employee (as defined in Section  1.29) who is a
          Participant  and is  employed  by the  Employer on the last day of the
          Plan Year will receive a top heavy  minimum  allocation  for that Plan
          Year and

               (b) The top heavy  minimum  allocation is the lesser of 3% of the
          Non-Key  Employee's  Compensation  for the  Plan  Year or the  highest
          contribution rate for the Plan Year made on behalf of any Key Employee
          (as  defined in section  1.29).  However,  if a defined  benefit  plan
          maintained by the Employer  which  benefits a Key Employee  depends on
          this Plan to satisfy the antidiscrimination rules of Code ss.401(a)(4)
          or the coverage  rules of Code ss.410 (or another plan  benefiting the
          Key Employee so depends on such defined  benefit plan),  the top heavy
          minimum  allocation  is  3% of  the  Non-Key  Employee's  Compensation
          regardless of the contribution rate for the Key Employees.

               (c) For purposes of this Section 3.04(B),  the term "Participant"
          includes any employee  otherwise  eligible to  participate in the Plan
          but who is not a  Participant  because of his failure to make elective
          deferrals under a Code ss.401(k) arrangement or because of his failure
          to make mandatory employee contributions.  For purposes of clause (b),
          "Compensation"   means   Compensation  as  defined  in  Section  1.10,
          disregarding   Elective   Contributions   and  any   exclusions   from
          Compensation.  For purposes of this Section  3.04(B),  a Participant's
          contribution rate is the sum of Employer  contributions (not including
          Employer  contributions to Social Security) and forfeitures  allocated
          to  the  Participant's  Account  for  the  Plan  Year  divided  by his
          Compensation  for the  entire  Plan  Year.  However,  for  Plan  Years
          beginning after December 31, 1988, a Non-Key  Employee's  contribution
          rate  does  not  include  any  Elective  Contributions  under  a  Code
          ss.401(k)   arrangement  nor  any  Employer   matching   contributions
          necessary  to  satisfy  the  nondiscrimination  requirements  of  Code
          ss.401(k)  or  of  Code   ss.401(m).   To  determine  a  Participant's
          contribution rate, the Advisory Committee must treat all qualified top
          heavy defined contribution plans maintained by the Employer (or by any
          related Employers described in Section 1.27) as a single Plan.

               (2) METHOD OF  COMPLIANCE.  The Plan will  satisfy  the top heavy
          minimum  allocation in accordance  with this Section  3.04(B)(2).  The
          Advisory Committee first will allocate the Employer contributions (and
          Participant forfeitures,  if any) for the Plan Year in accordance with
          the allocation  formula under Section 3.04(A).  The Employer then will
          contribute an additional amount for the Account of any Participant who
          is  entitled  under  this  Section  3.04(B)  to a  top  heavy  minimum
          allocation and whose  contribution rate for the Plan Year is less than
          the top heavy minimum allocation.  The additional amount is the amount
          necessary to increase the  Participant's  contribution rate to the top
          heavy minimum  allocation.  The Advisory  Committee  will allocate the
          additional  contribution  to the Account of the  Participant  on whose
          behalf the Employer makes the contribution.

     3.05 FORFEITURE  ALLOCATION.  The amount of a Participant's Accrued Benefit
forfeited under the Plan is a Participant forfeiture. Subject to any restoration
allocation  required  under  Section  5.04 or 9.12  and the  special  forfeiture
allocation  for certain  excess  aggregate  contributions  described  in Section
12.05,  the  Advisory  Committee  will  allocate  the amount of a  Participant's
Accrued  Benefit  forfeited  under the Plan in  accordance  with Section 3.04 to
reduce the Employer matching  contributions or profit sharing  contributions for
the Plan  Year in which the  forfeiture  occurs  and,  if  necessary,  to reduce
Employer  matching  contributions or profit sharing  contributions in subsequent
Plan Years.  The Advisory  Committee  will  continue to hold the  undistributed,
non-vested portion of a terminated  Participant's Accrued Benefit in his Account
solely  for his  benefit  until a  forfeiture  occurs at the time  specified  in
Section 5.09 or, if applicable, until the time specified in Section 9.12. Except
as provided  under Section 5.04, a Participant  will not share in the allocation
of a forfeiture of any portion of his Accrued Benefit.

     FORFEITURE OF CERTAIN  MATCHING  CONTRIBUTIONS.  A Participant will forfeit
any matching  contributions  allocated with respect to excess deferrals,  excess
contributions  or excess  aggregate  contributions,  as determined under Article
XII. The Advisory  Committee will allocate these forfeited amounts in accordance
with this Section 3.05.

     3.06 ACCRUAL OF BENEFIT.  The Advisory Committee will determine the accrual
of benefit (Employer contributions and Participant  forfeitures) on the basis of
the Plan Year, except as provided in Section 3.04.

     COMPENSATION  TAKEN INTO  ACCOUNT.  In  allocating  an  Employer  qualified
nonelective   contribution   or  an  Employer   discretionary   profit   sharing
contribution  to a Participant's  Account,  the Advisory  Committee,  except for
purposes  of  determining  the top  heavy  minimum  contribution  under  Section
3.04(B), will take into account only the Compensation determined for the portion
of the Plan Year in which the Employee is actually a Participant.

     HOURS OF SERVICE REQUIREMENT. A Participant will share in the
allocation  of  Employer  deferral  contributions,  matching  contributions  and
qualified nonelective  contributions for a Plan Year without regard to any Hours
of Service  requirement  for that Plan Year.  Subject to the  top-heavy  minimum
allocation  requirement of Section 3.04(B),  a Participant will not share in the
allocation of Employer  discretionary  profit sharing  contributions  for a Plan
Year if the  Participant  does not  complete a minimum of 1,000 Hours of Service
during the Plan Year,  unless the Participant  terminates  employment during the
Plan Year because of death or Disability or because of the  attainment of Normal
Retirement Age in the current Plan Year or in a prior Plan Year.

     EMPLOYMENT  REQUIREMENT.  A  Participant  will share in the  allocation  of
Employer  contributions for a Plan Year without regard to whether he is employed
by the Employer on the Accounting Date of that Plan Year.

PART 2.  LIMITATIONS ON ALLOCATION:  SECTIONS 3.07 AND 3.08.

     3.07  LIMITATIONS ON ALLOCATIONS TO PARTICIPANTS'  ACCOUNTS.  The amount of
Annual Additions which the Advisory  Committee may allocate under this Plan on a
Participant's   behalf  for  a  Limitation  Year  may  not  exceed  the  Maximum
Permissible Amount. If the amount the Employer otherwise would contribute to the
Participant's  Account would cause the Annual  Additions for the Limitation Year
to exceed the Maximum Permissible Amount, the Employer will reduce the amount of
its  contribution so the Annual Additions for the Limitation Year will equal the
Maximum Permissible Amount. If an allocation of Employer contributions, pursuant
to Section  3.04,  would result in an Excess Amount (other than an Excess Amount
resulting  from  the   circumstances   described  in  Section  3.07(B))  to  the
Participant's  Account, the Advisory Committee will reallocate the Excess Amount
to the  remaining  Participants  who are eligible for an  allocation of Employer
contributions  for the Plan Year in which the Limitation Year ends. The Advisory
Committee  will make this  reallocation  on the basis of the  allocation  method
under the Plan as if the Participant  whose Account  otherwise would receive the
Excess Amount is not eligible for an allocation of Employer contributions.

     (A)  ESTIMATION  OF  COMPENSATION.   Prior  to  the  determination  of  the
Participant's  actual Compensation for a Limitation Year, the Advisory Committee
may determine the Maximum  Permissible  Amount on the basis of the Participant's
estimated annual  Compensation for such Limitation Year. The Advisory  Committee
must  make  this  determination  on a  reasonable  and  uniform  basis  for  all
Participants similarly situated. The Advisory Committee must reduce any Employer
contributions  (including  any  allocation  of  forfeitures)  based on estimated
annual  Compensation by any Excess Amount carried over from prior years. As soon
as is  administratively  feasible  after  the end of the  Limitation  Year,  the
Advisory  Committee  will  determine  the  Maximum  Permissible  Amount for such
Limitation Year on the basis of the Participant's  actual  Compensation for such
Limitation Year.

     (B) DISPOSITION OF EXCESS AMOUNT.  If, as a result of a reasonable error in
determining  the amount of  elective  deferrals  an  Employee  may make  without
violating the  limitations  of Part 2 of Article III, an Excess Amount  results,
the Advisory  Committee will return the Excess Amount (as adjusted for allocable
income) attributable to the elective deferrals. The Advisory Committee will make
this  distribution  before  making any of the  corrective  distributions  in the
remaining  paragraphs  of this  Section  3.07(B).  The Advisory  Committee  will
disregard any elective  deferrals  returned under this paragraph for purposes of
Article XII.

     If, because of a reasonable error in estimating Compensation, or
because of the allocation of forfeitures, there is an Excess Amount with respect
to a Participant for a Limitation  Year, the Advisory  Committee will dispose of
such Excess Amount as follows:

          (a) The Advisory  Committee  will return any  nondeductible  voluntary
     Employee  contributions  to the  Participant  to the extent that the return
     would reduce the Excess Amount.

          (b) If, after the application of paragraph (a), an Excess Amount still
     exists,  and the Plan covers the  Participant  at the end of the Limitation
     Year, then the Advisory  Committee will use the Excess  Amount(s) to reduce
     future  Employer  contributions  (including any allocation of  forfeitures)
     under  the  Plan  for the next  Limitation  Year  and for  each  succeeding
     Limitation Year, as is necessary, for the Participant.

          (c) If, after the application of paragraph (a), an Excess Amount still
     exists,  and the Plan  does not  cover  the  Participant  at the end of the
     Limitation  Year,  then the Advisory  Committee will hold the Excess Amount
     unallocated in a suspense  account.  The Advisory  Committee will apply the
     suspense account to reduce Employer Contributions  (including allocation of
     forfeitures)  for all remaining  Participants in the next Limitation  Year,
     and in each succeeding Limitation Year if necessary.

          (d) Except as provided in paragraph  (a), the Advisory  Committee will
     not  distribute  any  Excess   Amount(s)  to   Participants  or  to  former
     Participants.

     (C) MORE THAN ONE  PLAN.  If the  Advisory  Committee  allocated  an Excess
Amount to a  Participant's  Account  on an  allocation  date of this Plan  which
coincides  with  an  allocation  date  of  another  defined   contribution  plan
maintained by the Employer,  the Advisory  Committee  will  attribute the Excess
Amount  allocated as of such date to the profit sharing  component of this Plan.
If an Excess  Amount  remains,  it will then be  attributed  to the Kansas  City
Southern Industries, Inc. Employee Stock Ownership Plan, and then, if necessary,
to the 401(k) plan component of this Plan.

     (D)  DEFINED  BENEFIT  PLAN  LIMITATION.   If  the  Participant   presently
participates, or has ever participated,  under a defined benefit plan maintained
by the  Employer,  then the sum of the defined  benefit  plan  fraction  and the
defined  contribution plan fraction for the Participant for that Limitation Year
must not exceed 1.0. To the extent  necessary  to satisfy this  limitation,  the
Employer will reduce its contribution or allocation on behalf of the Participant
to the defined  contribution  plan under which the Participant  participates and
then, if necessary, the Participant's projected annual benefit under the defined
benefit plan under which the Participant participates.

     3.08  DEFINITIONS - ARTICLE III. For purposes of Article III, the following
terms mean:

          (a) "Annual  Addition" - The sum of the following amounts allocated on
     behalf  of  a  Participant   for  a  Limitation   Year:  (i)  all  Employer
     contributions;  (ii) all forfeitures; and (iii) all Employee contributions.
     Except to the extent  provided in Treasury  Regulations,  Annual  Additions
     include excess contributions  described in Codess.401(k),  excess aggregate
     contributions  described in Codess.401(m) and excess deferrals described in
     Codess.402(g),  irrespective  of whether the Plan  distributes  or forfeits
     such  excess  amounts.   Annual   Additions  also  include  Excess  Amounts
     re-applied to reduce  Employer  contributions  under Section 3.07.  Amounts
     allocated  after  March 31,  1984,  to an  individual  medical  account (as
     defined in  Codess.415(1)(2))  included as part of a defined  benefit  plan
     maintained  by the  Employer  are  Annual  Additions.  Furthermore,  Annual
     Additions  include  contributions  paid or accrued after December 31, 1985,
     for  taxable  years  ending  after  December  31,  1985,   attributable  to
     post-retirement medical benefits allocated to the separate account of a key
     employee (as defined in Code  ss.419A(d)(3))  under a welfare  benefit fund
     (as defined in  Codess.419(e))  maintained  by the  Employer,  but only for
     purposes of the dollar  limitation  applicable  to the Maximum  Permissible
     Amount.

          (b)  "Compensation" - For purposes of applying the limitations of Part
     2 of this  Article III,  "Compensation"  means  Compensation  as defined in
     Section  1.10,   disregarding   any  exclusions   from   Compensation   and
     disregarding  Elective  Contributions with respect to Plan Years commencing
     before January 1, 1998, but including Elective Contributions for Plan Years
     commencing after December 31, 1997.

          (c) "Maximum  Permissible Amount" - The lesser of (i) $30,000, or (ii)
     25% of the Participant's  Compensation for the Limitation Year. If there is
     a short  Limitation  Year  because  of a change  in  Limitation  Year,  the
     Advisory  Committee  will multiply the $30,000 (or adjusted)  limitation by
     the following fraction:

                  NUMBER OF MONTHS IN THE SHORT LIMITATION YEAR
                  ---------------------------------------------
                                       12

          (d)  "Employer" - The  Employer  that adopts this Plan and any related
     employers  described in Section  1.27.  Solely for purposes of applying the
     limitations  of Part 2 of this Article III,  the  Advisory  Committee  will
     determine  related  employers  described in Section 1.27 by modifying  Code
     ss.414(b) and (c) in accordance with Code ss.415(h).

          (e) "Excess Amount" - The excess of the Participant's Annual Additions
     for the Limitation Year over the Maximum Permissible Amount.

          (f)  "Limitation  Year" - The Plan Year.  If the  Employer  amends the
     Limitation  Year  to a  different  12  consecutive  month  period,  the new
     Limitation  Year must begin on a date within the Limitation  Year for which
     the Employer makes the amendment, creating a short Limitation Year.

          (g) "Defined contribution plan" - A retirement plan which provides for
     an individual account for each participant and for benefits based solely on
     the  amount  contributed  to the  participant's  account,  and any  income,
     expenses,  gains and  losses,  and any  forfeitures  of  accounts  of other
     participants which the plan may allocate to such participant's account. The
     Advisory  Committee must treat all defined  contribution  plans (whether or
     not  terminated)  maintained by the Employer as a single plan. For purposes
     of the  limitations  of part 2 of this Article III, the Advisory  Committee
     will treat employee contributions made to a defined benefit plan maintained
     by the  Employer as a separate  defined  contribution  plan.  The  Advisory
     Committee  also will  treat as a defined  contribution  plan an  individual
     medical  account  (as  defined in  Codess.415(l)(2))  included as part of a
     defined  benefit plan  maintained  by the Employer  and, for taxable  years
     ending after December 31, 1985, a welfare benefit fund under Code ss.419(e)
     maintained by the Employer to the extent there are post-retirement  medical
     benefits allocated to the separate account of a key employee (as defined in
     Codess.419A(d)(3)).

          (h) "Defined  benefit plan" - A retirement plan which does not provide
     for individual accounts for Employer contributions.  The Advisory Committee
     must treat all defined benefit plans (whether or not terminated) maintained
     by the Employer as a single plan.

          (i) "Defined benefit plan fraction"

              Projected annual benefit of the Participant under the
                             defined benefit plan(s)
              -----------------------------------------------------
            The lesser of (i) 125% (subject to the "100% limitation"
              in paragraph (k)) of the dollar limitation in effect
               under Code ss.415(b)(1)(A) for the Limitation Year,
             or (ii) 140% of the Participant's average Compensation
                   for his high 3 consecutive Years of Service

          To determine the denominator of this fraction,  the Advisory Committee
     will make any adjustment required under Code ss.415(b) and will determine a
     Year of Service  as a Plan Year in which the  Employee  completed  at least
     1,000  Hours of  Service.  The  "projected  annual  benefit"  is the annual
     retirement  benefit  (adjusted to an actuarially  equivalent  straight life
     annuity if the plan  expresses such benefit in a form other than a straight
     life annuity or qualified  joint and survivor  annuity) of the  Participant
     under the terms of the defined benefit plan on the assumptions he continues
     employment  until his normal  retirement  age (or current age, if later) as
     stated in the defined benefit plan, his compensation  continues at the same
     rate as in effect in the Limitation Year under consideration until the date
     of his  normal  retirement  age  and all  other  relevant  factors  used to
     determine benefits under the defined benefit plan remain constant as of the
     current Limitation Year for all future Limitation Years.

          CURRENT ACCRUED BENEFIT. If the Participant accrued benefits in one or
     more  defined  benefit  plans  maintained  by the  Employer  which  were in
     existence on May 5, 1986, the dollar  limitation used in the denominator of
     this  fraction  will not be less  than the  Participant's  Current  Accrued
     Benefit.  A Participant's  Current Accrued Benefit is the sum of the annual
     benefits under such defined benefit plans which the Participant had accrued
     as of the  end of the  1986  Limitation  Year  (the  last  Limitation  Year
     beginning before January 1, 1987),  determined without regard to any change
     in the terms or conditions of the Plan made after May 5, 1986,  and without
     regard to any cost of living  adjustment  occurring after May 5, 1986. This
     Current  Accrued  Benefit rule applies  only if the defined  benefit  plans
     individually and in the aggregate satisfied the requirements of Code ss.415
     as in effect at the end of the 1986 Limitation Year.

          (j) "Defined contribution plan fraction"

             The sum, as of the close of the Limitation Year, of the
                  Annual Additions to the Participant's Account under the
                          defined contribution plan(s)
              ---------------------------------------------------
            The sum of the lesser of the following amounts determined
           for the Limitation Year and for each prior Year of Service
                   with the Employer: (i) 125% (subject to the
                "100% limitation" in paragraph (k)) of the dollar
             limitation in effect under Codess.415(c)(1)(A) for the
                Limitation Year (determined without regard to the
             special dollar limitations for employee stock ownership
              plans), or (ii) 35% of the Participant's Compensation
                             for the Limitation Year

          For purposes of determining  the defined  contribution  plan fraction,
     the Advisory  Committee will not recompute  Annual  Additions in Limitation
     Years   beginning   prior  to  January  1,  1987,  to  treat  all  Employee
     contributions  as Annual  Additions.  If the Plan satisfied Code ss.415 for
     Limitation Years beginning prior to January 1, 1987, the Advisory Committee
     will  redetermine  the defined  contribution  plan fraction and the defined
     benefit  plan  fraction  as of the  end  of the  1986  Limitation  Year  in
     accordance with this Section 3.08. If the sum of the redetermined fractions
     exceeds 1.0, the Advisory  Committee  will  subtract  permanently  from the
     numerator of the defined  contribution plan fraction an amount equal to the
     product of (1) the excess of the sum of the fractions  over 1.0,  times (2)
     the denominator of the defined  contribution  plan fraction.  In making the
     adjustment, the Advisory Committee must disregard any accrued benefit under
     the defined benefit plan which is in excess of the Current Accrued Benefit.
     This Plan continues any transitional  rules applicable to the determination
     of the defined  contribution  plan fraction under the Employer's Plan as of
     the end of the 1986 Limitation Year.

          (k) "100%  limitation." If the 100% limitation  applies,  the Advisory
     Committee  must  determine  the  denominator  of the defined  benefit  plan
     fraction and the denominator of the defined  contribution  plan fraction by
     substituting  100% for 125%. The 100%  limitation  applies only if: (i) the
     Plan's top heavy ratio  exceeds  90%; or (ii) the Plan's top heavy ratio is
     greater than 60%, and the Employer does not provide extra minimum  benefits
     which satisfy Code ss.416(h)(2).

                                  ARTICLE IV.
                            PARTICIPANT CONTRIBUTIONS

     4.01  PARTICIPANT  VOLUNTARY  CONTRIBUTIONS.  The Plan  does not  permit or
require Participant nondeductible contributions.

     4.02 PARTICIPANT  VOLUNTARY  CONTRIBUTIONS - SPECIAL  DISCRIMINATION  TEST.
(Reserved)

     4.03  PARTICIPANT  ROLLOVER  CONTRIBUTIONS.   Any  Participant,   with  the
Employer's written consent and after filing with the Trustee the form prescribed
by the Advisory  Committee,  may contribute  cash or other property to the Trust
other  than as a  voluntary  contribution  if the  contribution  is a  "rollover
contribution"  which the Code permits an employee to transfer either directly or
indirectly from one qualified plan to another qualified plan. Before accepting a
rollover   contribution,   the  Trustee  may  require  an  Employee  to  furnish
satisfactory  evidence  that  the  proposed  transfer  is in  fact  a  "rollover
contribution"  which the Code permits an employee to make to a qualified plan. A
rollover contribution is not an Annual Addition under Part 2 of Article III.

     The  Advisory   Committee  must  establish  a  Rollover  Account  for  each
Participant   making  a  rollover   contribution,   and  allocate  the  rollover
contribution to the Rollover Account as of the date the rollover contribution is
received.  The Trustee  will invest the rollover  contribution  as a part of the
Trust Fund.

     The Advisory  Committee may accept a rollover  contribution on behalf of an
Employee  prior  to the date  the  Employee  satisfies  the  Plan's  eligibility
conditions. If the Advisory Committee accepts such a rollover contribution,  the
Advisory  Committee must treat the Employee as a Participant for all purposes of
the Plan except the  Employee is not a  Participant  for  purposes of sharing in
Employer  contributions  or  Participant  forfeitures  under  the Plan  until he
actually becomes a Participant in the Plan.

     4.04 PARTICIPANT  CONTRIBUTION -  FORFEITABILITY.  A Participant's  Accrued
Benefit  is, at all times,  one hundred  percent  (100%)  Nonforfeitable  to the
extent the value of his Accrued  Benefit is derived  from  Participant  rollover
contributions made by him to the Trust for his own benefit.

     4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION.  A Participant may
not withdraw  any part of his Rollover  Account  attributable  to a  Participant
rollover  contribution  made by him to the Trust  except as  provided in Section
6.03(F).  The  Trustee,  in  accordance  with  the  direction  of  the  Advisory
Committee,   will  distribute  a  Participant's   unwithdrawn   Accrued  Benefit
attributable to his Participant  rollover  contributions  in accordance with the
provisions  of Article VI applicable to the  distribution  of the  Participant's
Nonforfeitable Accrued Benefit.

     4.06  PARTICIPANT  CONTRIBUTION - ACCRUED BENEFIT.  The Advisory  Committee
must maintain,  or must direct the Trustee to maintain, a separate Account(s) in
the name of each Participant to reflect the Participant's  Accrued Benefit under
the Plan derived from his Participant  rollover  contributions.  A Participant's
Accrued Benefit derived from his Participant  rollover  contributions  as of any
applicable date is the balance of his separate Participant rollover contribution
Account(s).

                                   ARTICLE V.
                  TERMINATION OF SERVICE - PARTICIPANT VESTING

     5.01 NORMAL  RETIREMENT  AGE. A Participant's  Normal  Retirement Age is 65
years of age. A  Participant  who  remains in the employ of the  Employer  after
attainment of Normal  Retirement  Age will continue to  participate  in Employer
contributions.   A   Participant's   Accrued   Benefit   derived  from  Employer
contributions  is 100%  Nonforfeitable  upon  and  after  his  attaining  Normal
Retirement Age (if employed by the Employer on or after that date).

     5.02  PARTICIPANT  DISABILITY OR DEATH. If a Participant's  employment with
the Employer  terminates as a result of death or disability,  the  Participant's
Accrued Benefit derived from Employer contributions will be 100% Nonforfeitable.

     5.03 VESTING  SCHEDULE.  A Participant's  Deferral  Contributions  Account,
Qualified Matching  Contributions Account,  Qualified Nonelective  Contributions
Account,  Profit Sharing  Contributions Account and Rollover Account will be one
hundred  percent  (100%)  Nonforfeitable  at all times.  Except as  provided  in
Sections 5.01 and 5.02, for each Year of Service, a Participant's Nonforfeitable
percentage of his Regular Matching  Contributions  Account equals the percentage
in the following vesting schedule:

                                               Percent of
          Years of Service                   Nonforfeitable
          With the Employer                  Accrued Benefit

          Less than 3                              None
          3                                        25%
          4                                        50%
          5                                        100%

     For any Plan Year for which the Plan is a top  heavy  Plan (as  defined  in
Section  1.29),   the  Advisory   Committee   will  calculate  a   Participant's
Nonforfeitable Percentage of his Accrued Benefit under the following schedule:

                                                 Percent of
         Years of Service                      Nonforfeitable
         With the Employer                     Accrued Benefit

         Less than 2 . . . . . . . . . . . . . . . None
         2           . . . . . . . . . . . . . . .  20%
         3           . . . . . . . . . . . . . . .  40%
         4           . . . . . . . . . . . . . . .  60%
         5          . . . . . . . . . . . . . . . .100%

     The Advisory  Committee will apply the top heavy  schedule to  Participants
who earn at least  one Hour of  Service  after the top  heavy  schedule  becomes
effective.  A shift  between  vesting  schedules  under this  Section 5.03 is an
amendment  to the vesting  schedule and the  Advisory  Committee  must apply the
rules of Section 7.05 accordingly.  A shift to a new vesting schedule under this
Section  5.03 is  effective  on the first day of the Plan Year for which the top
heavy status of the Plan changes.

     Notwithstanding  anything  in this  Section  5.03 or  Article  XVIII to the
contrary,  each Gateway  Participant (as defined in Section 18.01) shall be 100%
vested in his Accrued Benefit.

     5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED PARTICIPANTS/RESTORATION OF
FORFEITED  ACCRUED  BENEFIT.  If,  pursuant  to Article  VI, a  partially-vested
Participant receives a cash-out distribution before he incurs a Forfeiture Break
in Service (as defined in Section 5.08), the cash-out  distribution  will result
in an  immediate  forfeiture  of the  non-vested  portion  of the  Participant's
Accrued  Benefit  derived  from  Employer  contributions.  See Section  5.09.  A
partially-vested  Participant is a Participant whose  Nonforfeitable  Percentage
determined  under Section 5.03 is less than 100%. A cash-out  distribution  is a
distribution  of the entire  present value of the  Participant's  Nonforfeitable
Accrued Benefit.

     (A)  RESTORATION  AND  CONDITIONS  UPON  RESTORATION.   A  partially-vested
Participant  who is  reemployed  by the  Employer  after  receiving  a  cash-out
distribution of the  Nonforfeitable  percentage of his Accrued Benefit may repay
the Trustee the amount of the  cash-out  distribution  attributable  to Employer
contributions, unless the Participant no longer has a right to restoration under
the requirements of this Section 5.04. If a  partially-vested  Participant makes
the cash-out  distribution  repayment,  the Advisory  Committee,  subject to the
conditions of this paragraph (A), must restore his Accrued Benefit  attributable
to Employer  contributions to the same dollar amount as the dollar amount of his
Accrued Benefit on the Accounting  Date, or other  valuation  date,  immediately
preceding  the date of the cash-out  distribution,  unadjusted  for any gains or
losses  occurring  subsequent to that Accounting  Date, or other valuation date.
Restoration of the  Participant's  Accrued Benefit  includes  restoration of all
Code  ss.411(d)(6)  protected  benefits  with respect to that  restored  Accrued
Benefit,  in  accordance  with  applicable  Treasury  regulations.  The Advisory
Committee will not restore a reemployed Participant's Accrued Benefit under this
paragraph if:

          (1)  Five  (5)  years  have  elapsed  since  the  Participant's  first
     reemployment date following the cash-out distribution; or

          (2) The Participant incurred a Forfeiture Break in Service (as defined
     in Section  5.08).  This condition  also applies if the  Participant  makes
     repayment  within the Plan Year in which he incurs the Forfeiture  Break in
     Service and that  Forfeiture  Break in Service  would  result in a complete
     forfeiture of the amount the Advisory Committee otherwise would restore.

     (B) TIME AND  METHOD  OF  RESTORATION.  If  neither  of the two  conditions
preventing  restoration  of  the  Participant's  Accrued  Benefit  applies,  the
Advisory Committee will restore the Participant's Accrued Benefit as of the Plan
Year Accounting Date coincident with or immediately following the repayment.  To
restore the Participant's Accrued Benefit, the Advisory Committee, to the extent
necessary, will allocate to the Participant's Account:

          (1) First, the amount, if any, of Participant forfeitures the Advisory
     Committee would otherwise allocate under Section 3.05;

          (2) Second,  the amount,  if any, of the Trust Fund net income or gain
     for the Plan Year; and

          (3) Third,  the Employer  contribution for the Plan Year to the extent
     made under a discretionary formula.

     To the  extent  the  amounts  described  in  clauses  (1),  (2) and (3) are
insufficient to enable the Advisory Committee to make the required  restoration,
the Employer must contribute,  without regard to any requirement or condition of
Section 3.01, the additional  amount necessary to enable the Advisory  Committee
to make the required  restoration.  If, for a particular Plan Year, the Advisory
Committee  must  restore  the  Accrued  Benefit  of  more  than  one  reemployed
Participant, then the Advisory Committee will make the restoration allocation(s)
to each such  Participant's  Account in the same proportion that a Participant's
restored amount for the Plan Year bears to the restored amount for the Plan Year
of all  reemployed  Participants.  The  Advisory  Committee  will not take  into
account the  allocation  under this Section 5.04 in applying the  limitation  on
allocations under Part 2 of Article III.

     (C) 0% VESTED PARTICIPANT.  The deemed cash-out rule applies to a 0% vested
Participant.  A 0% vested  Participant  is a Participant  whose Accrued  Benefit
derived from Employer  contributions is entirely  forfeitable at the time of his
Separation from Service.  Under the deemed cash-out rule, the Advisory Committee
will treat the 0% vested Participant as having received a cash-out  distribution
on  the  date  of  the   Participant's   Separation  from  Service  or,  if  the
Participant's Account is entitled to an allocation of Employer contributions for
the Plan Year in which he separates  from Service,  on the last day of that Plan
Year.

     For purposes of applying the  restoration  provisions of this Section 5.04,
the  Advisory  Committee  will treat the 0% vested  Participant  as repaying his
cash-out "distribution" on the first date of his reemployment with the Employer.

     5.05  SEGREGATED  ACCOUNT FOR REPAID AMOUNT.  Until the Advisory  Committee
restores the  Participant's  Accrued Benefit,  as described in Section 5.04, the
Trustee  will  invest  the  cash-out  amount  the  Participant  has  repaid in a
segregated  Account  maintained  solely for that  Participant.  The Trustee must
invest the amount in the Participant's  segregated  Account in Federally insured
interest  bearing  savings  account(s) or time  deposit(s)  (or a combination of
both), or in other fixed income  investments.  Until commingled with the balance
of the Trust Fund on the date the Advisory  Committee restores the Participant's
Accrued  Benefit,  the  Participant's  segregated  Account remains a part of the
Trust, but it alone shares in any income it earns and it alone bears any expense
or loss it incurs.  Unless the repayment  qualifies as a rollover  contribution,
the Advisory  Committee  will direct the Trustee to repay to the  Participant as
soon as is  administratively  practicable  the full amount of the  Participant's
segregated Account if the Advisory Committee determines either of the conditions
of Sections 5.04(A) prevents  restoration as of the applicable  Accounting Date,
notwithstanding the Participant's repayment.

     5.06 YEAR OF SERVICE - VESTING. For purposes of vesting under Section 5.03,
Year of Service means any Plan Year during which an Employee  completes not less
than 1,000 Hours of Service with the Employer.

     5.07  BREAK IN  SERVICE  -  VESTING.  For  purposes  of this  Article  V, a
Participant  incurs a "Break in  Service"  if  during  any Plan Year he does not
completed more than 500 Hours of Service with the Employer.

     5.08  INCLUDED  YEARS OF SERVICE - VESTING.  For  purposes  of  determining
"Years of Service"  under Section 5.06, the Plan takes into account all Years of
Service  an  Employee  completes  with the  Employer.  For the sole  purpose  of
determining a  Participant's  Nonforfeitable  percentage of his Accrued  Benefit
derived from  Employer  contributions  which  accrued for his benefit prior to a
Forfeiture  Break in Service,  the Plan disregards any Year of Service after the
Participant first incurs a Forfeiture Break in Service. The Participant incurs a
Forfeiture Break in Service when he incurs 5 consecutive Breaks in Service.

     5.09 FORFEITURE OCCURS. A Participant's  forfeiture, if any, of his Accrued
Benefit derived from Employer contributions occurs under the Plan on the earlier
of:

          (a) The last  day of the Plan  Year in  which  the  Participant  first
     incurs a Forfeiture Break in Service; or

          (b) The date the Participant receives a cash-out distribution.

     The Advisory Committee determines the percentage of a Participant's Accrued
Benefit  forfeiture,  if any, under this Section 5.09 solely by reference to the
vesting  schedule of Section 5.03. A Participant will not forfeit any portion of
his Accrued  Benefit for any other reason or cause except as expressly  provided
by this Section 5.09 or as provided under Section 9.12.

                                  ARTICLE VI.
                     TIME AND METHOD OF PAYMENT OF BENEFITS

     6.01 TIME OF PAYMENT OF ACCRUED BENEFIT.  Unless, pursuant to Section 6.03,
the  Participant  or the  Beneficiary  elects in writing to a different  time or
method of payment,  the Advisory  Committee  will direct the Trustee to commence
distribution  of a  Participant's  Nonforfeitable  Accrued Benefit in accordance
with  this  Section  6.01.  A  Participant  must  consent,  in  writing,  to any
distribution  required  under  this  Section  6.01 if the  present  value of the
Participant's Nonforfeitable Accrued Benefit, at the time of the distribution to
the  Participant,  exceeds $5,000 and the Participant has not attained the later
of Normal  Retirement  Age or age 62. For all  purposes of this  Article VI, the
term "annuity  starting  date" means the first day of the first period for which
the Plan  pays an amount  as an  annuity  or in any  other  form.  Requests  for
distributions  under this Article VI (and under  Articles XVII and XVIII) may be
made at such times,  on such forms and in accordance with such procedures as the
Advisory  Committee  may from time to time  prescribe.  For purposes of making a
distribution,  (i)  a  Participant's  Account  shall  be  valued  as  of a  date
("distribution valuation date"), which ordinarily shall be the first Friday (or,
if such Friday is not a business day, the next  following  business day) that is
not less than four business days following receipt by the Advisory  Committee of
a  properly  completed  request  for  distribution  (or,  if  the  Participant's
Nonforfeitable   Accrued   Benefit  does  not  exceed   $5,000,   following  the
Participant's   Separation  from  Service),   or  as  soon  as  administratively
practicable thereafter,  and (ii) the distribution shall be made or commenced on
a business day  ("distribution  date") as soon as  administratively  practicable
following such distribution valuation date.

     (A)  TERMINATION  OF  EMPLOYMENT  FOR A  REASON  OTHER  THAN  DEATH.  For a
Participant who terminates  employment with the Employer for a reason other than
death, the Advisory  Committee will direct the Trustee to commence  distribution
of the Participant's Accrued Benefit, as follows:

          (1) PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT NOT EXCEEDING $5,000.
     In a lump  sum,  as soon as  administratively  practicable  after the first
     distribution  valuation date following the  Participant's  Separation  from
     Service, but in no event later than the 60th day following the close of the
     Plan Year in which the  Participant  attains  Normal  Retirement  Age. If a
     Participant  incurred a  Separation  from  Service  under this Plan  before
     August 1, 1999 with a nonforfeitable Accrued Benefit of more than $3,500 as
     of August 1, 1999 but not more than $5,000,  has not previously  received a
     cash-out  distribution  under this  subsection (1) and has not commenced to
     receive  a  distribution  under  subsection  (2) below  and  Section  6.03,
     distribution to the Participant  shall be made under this subsection (1) as
     soon as practicable after August 1, 1999.

          (2) PARTICIPANT'S  NONFORFEITABLE  ACCRUED BENEFIT EXCEEDS $5,000 In a
     form and at the time elected by the Participant,  pursuant to Section 6.03.
     In the absence of an election by the  Participant,  the Advisory  Committee
     will  direct the Trustee to  distribute  the  Participant's  Nonforfeitable
     Accrued  Benefit in a lump sum, on the 60th day  following the close of the
     Plan  Year in which  the  later of the  following  events  occurs:  (a) the
     Participant attains Normal Retirement Age; or (b) the Participant separates
     from Service.

     (B)  REQUIRED  BEGINNING  DATE.  If  any  distribution   commencement  date
described under Paragraph (A) of this Section 6.01,  either by Plan provision or
by  Participant  election  (or  nonelection),  is later  than the  Participant's
Required  Beginning Date, the Advisory Committee instead must direct the Trustee
to make  distribution  under this  Section  6.01 on the  Participant's  Required
Beginning  Date. A Participant's  Required  Beginning Date is the April 1 of the
calendar  year  following  the  later  of (i) the  calendar  year in  which  the
Participant  attains  age 70 1/2,  or  (ii)  the  calendar  year  in  which  the
Participant  separates  from  Service.  However,  clause  (ii) of the  preceding
sentence shall not apply if the Participant is a 5% owner (as defined in Section
1.07(a))  with respect to the Plan Year ending in the calendar  year in which he
attains  age 70 1/2. A  mandatory  distribution  at the  Participant's  Required
Beginning  Date will be in lump sum  unless  the  Participant,  pursuant  to the
provisions of this Article VI, makes a valid  election to receive an alternative
form of payment.

     (C) DEATH OF THE  PARTICIPANT.  The  Advisory  Committee  will  direct  the
Trustee,  in  accordance  with  this  Section  6.01(C),  to  distribute  to  the
Participant's  Beneficiary  the  Participant's  Nonforfeitable  Accrued  Benefit
remaining  in the Trust at the time of the  Participant's  death.  The  Advisory
Committee  will  determine  the death  benefit  by  reducing  the  Participant's
Nonforfeitable  Accrued  Benefit by any  security  interest the Plan has against
that  Nonforfeitable  Accrued  Benefit by reason of an  outstanding  Participant
loan.

          (1) DECEASED  PARTICIPANT'S  NONFORFEITABLE  ACCRUED  BENEFIT DOES NOT
     EXCEED  $5,000.  The Advisory  Committee must direct the Trustee to pay the
     deceased Participant's Nonforfeitable Accrued Benefit in a single cash sum,
     as  soon as  administratively  practicable  after  the  first  distribution
     valuation date following the Participant's  death or, if later, the date on
     which the Advisory Committee receives notification of or otherwise confirms
     the Participant's death.

          (2) DECEASED  PARTICIPANT'S  NONFORFEITABLE  ACCRUED  BENEFIT  EXCEEDS
     $5,000.  The Advisory Committee will direct the Trustee to pay the deceased
     Participant's  Nonforfeitable  Accrued  Benefit at the time and in the form
     elected  by the  Participant  or,  if  applicable  by the  Beneficiary,  as
     permitted  under  this  Article  VI. In the  absence  of an  election,  the
     Advisory  Committee will direct the Trustee to distribute the Participant's
     undistributed  Nonforfeitable  Accrued  Benefit  in a lump  sum as  soon as
     administratively  practicable after the first  distribution  valuation date
     following  the  Participant's  death or,  if  later,  the date on which the
     Advisory  Committee  receives  notification  of or  otherwise  confirms the
     Participant's death.

     If the death benefit is payable to the  Participant's  surviving  spouse in
full, the surviving spouse, in addition to the distribution  options provided in
this Section  6.01(C),  may elect  distribution  at any time or in any form this
Article VI would permit for a Participant.

     6.02  METHOD OF  PAYMENT OF ACCRUED  BENEFIT.  Subject to any  restrictions
prescribed by Section 6.03, a Participant or Beneficiary may elect  distribution
from the  Participant's  Accounts under one or any  combination of the following
methods:  (a) by payment in a lump sum; or (b) by payment in monthly,  quarterly
or annual installments over a fixed reasonable period of time, not exceeding the
life  expectancy  of the  Participant,  or the  joint  life  and  last  survivor
expectancy of the Participant and his Beneficiary.

     The installment  distribution options permitted under this Section 6.02 are
available only if the present value of the Participant's  Nonforfeitable Accrued
Benefit, at the time of the distribution to the Participant,  exceeds $5,000. To
facilitate  installment  payments under this Article VI, the Advisory  Committee
may direct the Trustee to segregate all or any part of the Participant's Accrued
Benefit  in a separate  Account.  The  Trustee  will  invest  the  Participant's
segregated  Account in Federally insured interest bearing savings  account(s) or
time   deposit(s)  (or  a  combination  of  both),  or  in  other  fixed  income
investments.  A  segregated  Account  remains a part of the Trust,  but it alone
shares in any income it earns, and it alone bears any expense or loss it incurs.
A Participant or Beneficiary may elect to receive an installment distribution in
the  form  of  a  Nontransferable   Annuity   Contract.   Under  an  installment
distribution,  the  Participant  or  Beneficiary,  at any  time,  may  elect  to
accelerate  the  payment of all, or any  portion,  of the  Participant's  unpaid
Nonforfeitable Accrued Benefit.

     (A)  MINIMUM  DISTRIBUTION  REQUIREMENTS  FOR  PARTICIPANTS.  The  Advisory
Committee   may  not  direct  the  Trustee  to  distribute   the   Participant's
Nonforfeitable  Accrued  Benefit,  nor may the  Participant  elect  to have  the
Trustee distribute his Nonforfeitable Accrued Benefit, under a method of payment
which,  as of  the  Required  Beginning  Date,  does  not  satisfy  the  minimum
distribution  requirements  under Code ss.401(a)(9) and the applicable  Treasury
regulations.   The  minimum   distribution   for  a  calendar  year  equals  the
Participant's  Nonforfeitable  Accrued  Benefit as of the latest  valuation date
preceding the beginning of the calendar year divided by the  Participant's  life
expectancy  or, if  applicable,  the joint and last  survivor  expectancy of the
Participant and his designated  Beneficiary  (as determined  under Article VIII,
subject to the requirements of the Code ss.401(a)(9) regulations).  The Advisory
Committee will increase the  Participant's  Nonforfeitable  Accrued Benefit,  as
determined on the relevant  valuation  date,  for  contributions  or forfeitures
allocated after the valuation date and by December 31 of the valuation  calendar
year, and will decrease the valuation by distributions  made after the valuation
date and by December 31 of the  valuation  calendar  year.  For purposes of this
valuation,  the  Advisory  Committee  will  treat  any  portion  of the  minimum
distribution  for the first  distribution  calendar year made after the close of
that year as a distribution  occurring in that first distribution calendar year.
In computing a minimum distribution,  the Advisory Committee must use the unisex
life expectancy  multiples under Treas. Reg. ss.1.72-9.  The Advisory Committee,
only  upon  the   Participant's   written  request,   may  compute  the  minimum
distribution for a calendar year subsequent to the first calendar year for which
the Plan requires a minimum  distribution by  redetermining  the applicable life
expectancy.  However,  the Advisory Committee may not redetermine the joint life
and last survivor  expectancy  of the  Participant  and a non-spouse  designated
Beneficiary  in a manner  which  takes into  account  any  adjustment  to a life
expectancy other than the Participant's life expectancy.

     If the Participant's spouse is not his designated Beneficiary,  a method of
payment to the Participant may not provide more than incidental  benefits to the
Beneficiary.  For Plan Years  beginning  after  December 31, 1988, the Plan must
satisfy the minimum distribution  incidental benefit ("MDIB") requirement in the
Treasury regulations issued under Code ss.401(a)(9) for distributions made on or
after the  Participant's  Required  Beginning Date and before the  Participant's
death. To satisfy the MDIB requirement,  the Advisory Committee will compute the
minimum  distribution  required  by this  Section  6.02(A) by  substituting  the
applicable MDIB divisor for the applicable life expectancy  factor,  if the MDIB
divisor is a lesser  number.  Following the  Participant's  death,  the Advisory
Committee will compute the minimum distribution required by this Section 6.02(A)
solely on the basis of the applicable life expectancy  factor and will disregard
the MDIB factor.  For Plan Years  beginning  prior to January 1, 1989,  the Plan
satisfies  the  incidental  benefits  requirement  if the  distributions  to the
Participant  satisfied  the  MDIB  requirement  or if the  present  value of the
retirement benefits payable solely to the Participant is greater than 50% of the
present  value  of the  total  benefits  payable  to  the  Participant  and  his
Beneficiaries.  The Advisory  Committee must determine  whether  benefits to the
Beneficiary are incidental as of the date the Trustee is to commence  payment of
the  retirement  benefits  to the  Participant,  or as of any date  the  Trustee
redetermines the payment period to the Participant.

     The minimum distribution for the first distribution calendar year is due by
the  Participant's  Required  Beginning Date. The minimum  distribution for each
subsequent  distribution calendar year, including the calendar year in which the
Participant's Required Beginning Date falls, is due by December 31 of that year.
If the  Participant  receives  distribution  in the  form  of a  Nontransferable
Annuity  Contract,  the  distribution  satisfies  this  Section  6.02(A)  if the
contract  complies with the requirements of Code ss.401(a)(9) and the applicable
Treasury regulations.

     (B) MINIMUM  DISTRIBUTION  REQUIREMENTS  FOR  BENEFICIARIES.  The method of
distribution to the Participant's Beneficiary must satisfy Code ss.401(a)(9) and
the applicable Treasury regulations. If the Participant's death occurs after his
Required  Beginning Date, the method of payment to the Beneficiary  must provide
for completion of payment over a period which does not exceed the payment period
which had commenced for the Participant. If the Participant's death occurs prior
to his Required  Beginning Date, the method of payment to the Beneficiary,  must
provide  for  completion  of  payment  to  the  Beneficiary  over a  period  not
exceeding: (i) 5 years after the date of the Participant's death; or (ii) if the
Beneficiary  is a designated  Beneficiary,  the  designated  Beneficiary's  life
expectancy.  The Advisory  Committee may not direct payment of the Participant's
Nonforfeitable Accrued Benefit over a period described in clause (ii) unless the
Trustee will commence  payment to the  designated  Beneficiary no later than the
December 31 following the close of the calendar year in which the  Participant's
death occurred or, if later, and the designated Beneficiary is the Participant's
surviving  spouse,  December 31 of the  calendar  year in which the  Participant
would  have  attained  age 70 1/2.  If the  Trustee  will make  distribution  in
accordance with clause (ii), the minimum distribution for a calendar year equals
the Participant's Nonforfeitable Accrued Benefit as of the latest valuation date
preceding  the  beginning  of  the  calendar  year  divided  by  the  designated
Beneficiary's  life expectancy.  The Advisory Committee must use the unisex life
expectancy  multiples under Treas. Reg.  ss.1.72-9 for purposes of applying this
paragraph.  The  Advisory  Committee,  only  upon  the  written  request  of the
Participant or of the Participant's  surviving spouse,  may recalculate the life
expectancy  of the  Participant's  surviving  spouse  not more  frequently  than
annually but may not recalculate the life expectancy of a non-spouse  designated
Beneficiary after the Trustee  commenced payment to the designated  Beneficiary.
The Advisory  Committee will apply this paragraph by treating any amount paid to
the Participant's  child,  which becomes payable to the Participant's  surviving
spouse  upon  the  child's  attaining  the  age  of  majority,  as  paid  to the
Participant's  surviving  spouse.  Upon the Beneficiary's  written request,  the
Advisory  Committee must direct the Trustee to accelerate payment of all, or any
portion,   of  the   Participant's   unpaid   Accrued   Benefit,   as   soon  as
administratively practicable following the effective date of that request.

     6.03 BENEFIT PAYMENT  ELECTIONS.  Not earlier than 90 days before nor later
than  30  days  before  the  Participant's   annuity  starting  date,  the  Plan
Administrator  must provide a benefit notice to a Participant who is eligible to
make an election  under this Section 6.03.  The benefit  notice must explain the
optional  forms of benefit in the Plan,  including  the  material  features  and
relative  values  of  those  options,  and  the  Participant's  right  to  defer
distribution until he attains the later of Normal Retirement Age or age 62.

     A  distribution  may commence less than 30 days after the benefit notice is
given, provided that:

          (1) the Plan  Administrator  clearly informs the Participant  that the
     Participant has a right to a period of at least 30 days after receiving the
     notice to consider the  decision of whether or not to elect a  distribution
     (and, if applicable, a particular distribution option), and

          (2) the Participant,  after receiving the notice, affirmatively elects
     a distribution.

     If a  Participant  or  Beneficiary  makes an  election  prescribed  by this
Section 6.03,  the Advisory  Committee will direct the Trustee to distribute the
Participant's  Nonforfeitable  Accrued Benefit in accordance with that election.
Any election under this Section 6.03 is subject to the  requirements  of Section
6.02. The  Participant  or Beneficiary  must make an election under this Section
6.03 by filing his election form with the Advisory  Committee at any time before
the Trustee  otherwise would commence to pay a Participant's  Accrued Benefit in
accordance with the requirements of Article VI.

     (A) PARTICIPANT  ELECTIONS AFTER TERMINATION OF EMPLOYMENT.  If the present
value of a Participant's  Nonforfeitable  Accrued Benefit exceeds $5,000, he may
elect to have the  Trustee  commence  distribution  as soon as  administratively
practicable  after any distribution  valuation date following the  Participant's
Separation from Service.  The Participant may reconsider an election at any time
prior to the annuity starting date and elect to commence  distribution as of any
other  distribution  date,  but not earlier than the date described in the first
sentence of this Paragraph (A). A Participant who has separated from Service may
elect  distribution  as of any  distribution  date  following his  attainment of
Normal  Retirement Age,  irrespective of the restrictions  otherwise  applicable
under this  Section  6.03(A).  If the  Participant  is  partially-vested  in his
Accrued Benefit, an election under this Paragraph (A) to distribute prior to the
Participant's  incurring  a  Forfeiture  Break in Service (as defined in Section
5.08), must be in the form of a cash-out distribution (as defined in Article V).
A Participant may not receive a cash-out  distribution if, prior to the time the
Trustee  actually makes the cash out  distribution,  the Participant  returns to
employment with the Employer.

     (B) PARTICIPANT ELECTIONS PRIOR TO TERMINATION OF EMPLOYMENT.

          (1)  DISTRIBUTION.  After a Participant (1) attains Normal  Retirement
     Age or (2) attains  age 59-1/2 and has at least five Years of Service,  the
     Participant,  until he retires, has a continuing election to receive all or
     any portion of his Accrued  Benefit  attributable  to his Regular  Matching
     Contributions  Account.  After a Participant attains Normal Retirement Age,
     the Participant, until he retires, has a continuing election to receive all
     or any portion of his Accrued  Benefit  attributable  to his Profit Sharing
     Contributions  Account.  A  Participant  must make an  election  under this
     Section 6.03(B) on a form prescribed by the Advisory  Committee at any time
     during  the Plan Year for which his  election  is to be  effective.  In his
     written  election,  the  Participant  must specify the percentage or dollar
     amount he wishes  the  Trustee  to  distribute  to him.  The  Participant's
     election relates solely to the percentage or dollar amount specified in his
     election  form and his right to elect to receive an amount,  if any,  for a
     particular Plan Year greater than the dollar amount or percentage specified
     in his election form  terminates on the  Accounting  Date. The Trustee must
     make a distribution  to a Participant in accordance with his election under
     this   Section   6.03(B)   within  the   90-day   period  (or  as  soon  as
     administratively  practicable)  after the  Participant  files  his  written
     election with the Trustee.

          (2) DIRECT  ROLLOVER.  For  purposes of this Section  6.03(B)(2),  the
     terms "eligible  retirement plan," "direct rollover" and "eligible rollover
     distribution" shall have the meanings ascribed to them in Section 6.08. Any
     Participant who has attained 59-1/2 and has at least five Years of Service,
     until he retires,  has a  continuing  election to direct the Trustee to pay
     directly to an eligible  retirement  plan specified by the Participant in a
     direct  rollover all or any portion,  with a minimum portion of 20%, of his
     Nonforfeitable   Accrued   Benefit   attributable  to  his  Profit  Sharing
     Contributions  Account,  provided that the payment is an eligible  rollover
     distribution.  A  Participant  may  make an  election  under  this  Section
     6.03(B)(2)  on a form  prescribed  by the  Advisory  Committee  at any time
     during  the Plan Year for which his  election  is to be  effective.  In his
     written  election,  the  Participant  must specify the percentage or dollar
     amount he wishes the  Trustee to  distribute.  The  Participant's  election
     relates solely to the percentage or dollar amount specified in his election
     form and his right to elect to have directly rolled over an amount, if any,
     for a particular  Plan Year greater  than the dollar  amount or  percentage
     specified in his election  form  terminates  on the  Accounting  Date.  The
     Trustee  must  pay the  amount  specified  by the  participant  in a direct
     rollover in accordance with the Participant's election under this paragraph
     within the 90 day period (or as soon as administratively practicable) after
     the Participant files his written election with the Trustee.

The Trustee will distribute the balance of the Participant's Accrued Benefit not
distributed under this Section 6.03(B) in accordance with the other distribution
provisions of this Plan.

     (C)  DEATH  BENEFIT  ELECTIONS.  If  the  present  value  of  the  deceased
Participant's  Nonforfeitable  Accrued Benefit exceeds $5,000, the Participant's
Beneficiary  may  elect  to  have  the  Trustee   distribute  the  Participant's
Nonforfeitable  Accrued  Benefit in a form and within a period  permitted  under
Section  6.02.  The  Beneficiary's  election  is  subject  to  any  restrictions
designated  in  writing  by the  Participant  and not  revoked as of his date of
death.

     (D) TRANSITIONAL ELECTIONS.  Notwithstanding the provisions of Section 6.01
and 6.02, if the  Participant  (or  Beneficiary)  signed a written  distribution
designation prior to January 1, 1984, the Advisory Committee must distribute the
Participant's   Nonforfeitable   Accrued   Benefit  in   accordance   with  that
designation.  This  Section  6.03(D)  does not apply to a pre-1984  distribution
designation, and the Advisory Committee will not comply with that designation if
any of the following applies: the method of distribution would have disqualified
the Plan under Code  ss.401(a)(9)  as in effect on December  31,  1983;  (2) the
Participant  did not have an Accrued  Benefit as of December 31,  1983;  (3) the
distribution   designation   does  not  specify  the  timing  and  form  of  the
distribution  and the  death  Beneficiaries  (in  order  of  priority);  (4) the
substitution of a Beneficiary  modifies the payment period of the  distribution;
or (5) the Participant  (or  Beneficiary)  modifies or revokes the  distribution
designation.  In the event of a revocation,  the Plan must distribute,  no later
than December 31 of the calendar  year  following  the year of  revocation,  the
amount which the  Participant  would have received under Section  6.02(A) if the
election had not been in effect or, if the Beneficiary revokes the election, the
amount which the  Beneficiary  would have received under Section  6.02(B) if the
election had not been in effect.  The Advisory Committee will apply this Section
6.03(D)  to  rollovers  and  transfers  in  accordance  with  Part J of the Code
ss.401(a)(9) regulations.

     (E) SPECIAL  DISTRIBUTIONS  RULES FOR  DEFERRAL  CONTRIBUTIONS  ACCOUNT AND
QUALIFIED ACCOUNTS.  The in-service  distribution  provisions in Section 6.03(B)
will not apply to the  Deferral  Contributions  Account,  Qualified  Nonelective
Contributions Account, and Qualified Matching  Contributions  Account.  Instead,
the  distribution  provisions in this Section  6.03(E) will apply to withdrawals
from these Accounts by a Participant prior to his Separation from Service. After
the  Participant's  Separation  from Service,  the provisions of this Article VI
other  than  this  Section  6.03(E)  will  apply  to  the  distribution  of  the
Participant's entire Accrued Benefit. If the Employer sells substantially all of
the assets (within the meaning of Code ss.409(d)(2)) used in a trade or business
or sells a subsidiary (within the meaning of Code  ss.409(d)(3)),  a Participant
who  continues  employment  with  the  acquiring  corporation  is  eligible  for
distribution from these Accounts as if he has a Separation from Service, but for
distributions made after March 31, 1988, only if the distribution  constitutes a
lump sum distribution, determined in a manner consistent with Code ss.401(k)(10)
and the applicable Treasury regulations.

     The Participant,  until he retires,  has a continuing election to receive a
distribution  from his Deferral  Contributions  Account,  Qualified  Nonelective
Contributions  Account, and Qualified Matching  Contributions Account if: (I) he
has attained  age 59-1/2;  or (II) he incurs an  immediate  and heavy  financial
hardship.  The distribution event under clause (I) applies to all or any portion
of these Accounts.  The distribution event under clause (II) applies only to the
elective deferrals allocated to the Participant's Deferral Contributions Account
plus any  earnings  on the  Participant's  elective  deferrals  credited  before
January 1, 1989.

     A hardship distribution, as described in clause (II), must be on account of
one or more of the following  immediate and heavy financial  needs:  (1) medical
expenses  described  in  Code  ss.213(d)  incurred  by the  Participant,  by the
Participant's spouse, or any of the Participant's  dependents;  (2) the purchase
(excluding mortgage payments) of a principal residence for the Participant;  (3)
the payment of post-secondary  education tuition,  related educational fees, and
room and board  expenses,  for the next 12 months for the  Participant,  for the
Participant's  spouse,  or for any of the  Participant's  dependents;  or (4) to
prevent the  eviction of the  Participant  from his  principal  residence or the
foreclosure  on the  mortgage  of the  Participant's  principal  residence.  The
Participant may make application for a hardship distribution at any time.

     RESTRICTIONS ON HARDSHIP DISTRIBUTION.  The following restrictions apply to
a  Participant's  hardship  distribution  under this  Section  6.03(E):  (a) the
Participant  may not make elective  deferrals or employee  contributions  to the
Plan for the 12-month  period  following the date of his hardship  distribution;
(b) the  distribution  may not  exceed  the  amount of the  immediate  and heavy
financial need; (c) the Participant must have obtained all  distributions  under
this Section  6.03(E),  other than hardship  distributions,  and all  nontaxable
loans  currently  available  under  this  Plan  and all  other  qualified  plans
maintained by the Employer;  and (d) the  Participant  agrees to limit  elective
deferrals  under this Plan and under any other  qualified plan maintained by the
Employer,  for the Participant's  taxable year immediately following the taxable
year of the hardship  distribution under this Section 6.03(E),  to the ss.402(g)
limitation  (as  described  in  Section  12.03),  reduced  by the  amount of the
Participant's  elective  deferrals  made in the  taxable  year  of the  hardship
distribution.

     PROCEDURE.  A Participant  must make an election under this Section 6.03(E)
on a form prescribed by the Advisory  Committee at any time during the Plan Year
for  which  his  election  is to be  effective.  In his  written  election,  the
Participant  must specify the  percentage or dollar amount he wishes the Trustee
to  distribute  to  him.  The  Participant's  election  relates  solely  to  the
percentage  or dollar  amount  specified in his  election  form and his right to
elect to receive an amount,  if any, for a particular Plan Year greater than the
dollar  amount or percentage  specified in his election  form  terminates on the
Accounting  Date.  The Trustee  must make a  distribution  to a  Participant  in
accordance with his election under this Section 6.03(E) within the 90-day period
(or as soon as  administratively  practicable)  after the Participant  files his
written election with the Trustee.

     (F)  SPECIAL  DISTRIBUTION  RULES  FOR  ROLLOVER  ACCOUNT.  The  in-service
distribution  provisions  in  Section  6.03(B)  will not  apply to the  Rollover
Account. Instead, the distribution provisions in this Section 6.03(F) will apply
to withdrawals  from that account by a Participant  prior to his Separation from
Service. After the Participant's Separation from Service, the provisions of this
Article VI other than this Section 6.03(F) will apply to the distribution of the
Participant's entire Accrued Benefit.

     The Participant,  until he retires,  has a continuing election to receive a
distribution  from his  Rollover  Account if: (I) he has attained age 59 1/2; or
(II) he incurs an immediate and heavy financial hardship.

         A  hardship  distribution,  as  described  in clause  (II),  must be on
account of one or more of the following immediate and heavy financial needs: (1)
medical expenses described in Code ss.213(d) incurred by the Participant, by the
Participant's spouse, or any of the Participant's  dependents;  (2) the purchase
(excluding mortgage payments) of a principal residence for the Participant;  (3)
the payment of post-secondary  education tuition,  related educational fees, and
room and board  expenses,  for the next 12 months for the  Participant,  for the
Participant's  spouse,  or for any of the  Participant's  dependents;  or (4) to
prevent the  eviction of the  Participant  from his  principal  residence or the
foreclosure  on the  mortgage  of the  Participant's  principal  residence.  The
Participant  may make  application  for a hardship  distribution of his Rollover
Account at any time.

     PROCEDURE.  A Participant  must make an election under this Section 6.03(F)
on a form prescribed by the Advisory  Committee at any time during the Plan Year
for  which  his  election  is to be  effective.  In his  written  election,  the
Participant  must specify the  percentage or dollar amount he wishes the Trustee
to  distribute  to  him.  The  Participant's  election  relates  solely  to  the
percentage  or dollar  amount  specified in his  election  form and his right to
elect to receive an amount,  if any, for a particular Plan Year greater than the
dollar  amount or percentage  specified in his election  form  terminates on the
Accounting  Date.  The Trustee  must make a  distribution  to a  Participant  in
accordance with his election under this Section 6.03(F) within the 90-day period
(or as soon as  administratively  practicable)  after the Participant  files his
written election with the Trustee.

     6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING SPOUSES. The joint
and survivor  annuity  requirements do not apply to this Plan. The Plan does not
provide any annuity  distributions to Participants nor to surviving  spouses.  A
transfer  agreement  described  in Section  11.05 may not permit a plan which is
subject to the provisions of Code ss.417 to transfer assets to this Plan, unless
the transfer is an elective transfer, as described in Section 11.05.

     6.05 WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY. [Reserved]

     6.06  WAIVER  ELECTION  -  PRERETIREMENT   SURVIVOR   ANNUITY.   [Reserved]

     6.07 DISTRIBUTIONS  UNDER DOMESTIC  RELATIONS ORDERS.  Nothing contained in
this Plan prevents the Trustee, in accordance with the direction of the Advisory
Committee,  from complying with the provisions of a qualified domestic relations
order  (as  defined  in  Code  ss.414(p)).   This  Plan   specifically   permits
distribution to an alternate payee under a qualified domestic relations order as
soon as  administratively  practicable after any distribution  valuation date of
any Plan Year, irrespective of whether the Participant has attained his earliest
retirement age (as defined under Code ss.414(p))  under the Plan. A distribution
to an  alternate  payee  prior  to  the  Participant's  attainment  of  earliest
retirement age is available  only if: (1) the order  specifies  distribution  at
that time or permits an agreement  between the Plan and the  alternate  payee to
authorize an earlier distribution; and (2) if the present value of the alternate
payee's  benefits under the Plan exceeds  $5,000,  and the order  requires,  the
alternate   payee  consents  to  any   distribution   occurring   prior  to  the
Participant's  attainment of earliest  retirement  age.  Nothing in this Section
6.07 gives a Participant a right to receive distribution at a time otherwise not
permitted  under the Plan nor does it permit  the  alternate  payee to receive a
form of payment not permitted under the Plan.

     The Plan  Administrator must establish  reasonable  procedures to determine
the qualified status of a domestic  relations  order.  Upon receiving a domestic
relations order, the Plan Administrator promptly will notify the Participant and
any alternate payee named in the order, in writing,  of the receipt of the order
and the Plan's  procedures for  determining  the qualified  status of the order.
Within a reasonable period of time after receiving the domestic relations order,
the Plan Administrator must determine the qualified status of the order and must
notify  the   Participant  and  each  alternate   payee,  in  writing,   of  its
determination.  The Plan  Administrator must provide notice under this paragraph
by mailing to the  individual's  address  specified  in the  domestic  relations
order,  or in a  manner  consistent  with  Department  of Labor  regulations.  A
qualified  domestic  relations order that, prior to the Effective Date, had been
determined  to be  qualified  under the Profit  Sharing Plan with respect to the
Accrued Benefit of a Participant  under the Profit Sharing Plan,  shall continue
to be treated  as a  qualified  domestic  relations  order  under this Plan with
respect to the Accounts of the  Participant  that were  transferred to this Plan
from the Profit Sharing Plan.

     If any  portion  of the  Participant's  Nonforfeitable  Accrued  Benefit is
payable during the period the Plan  Administrator is making its determination of
the qualified status of the domestic  relations  order,  the Advisory  Committee
must  make  a  separate   accounting  of  the  amounts  payable.   If  the  Plan
Administrator  determines  the order is a  qualified  domestic  relations  order
within 18 months of the date amounts first are payable  following receipt of the
order, the Advisory  Committee will direct the Trustee to distribute the payable
amounts in accordance  with the order. If the Plan  Administrator  does not make
its  determination  of the  qualified  status of the order  within  the 18 month
determination  period,  the  Advisory  Committee  will  direct  the  Trustee  to
distribute  the payable  amounts in the manner the Plan would  distribute if the
order  did not  exist  and  will  apply  the  order  prospectively  if the  Plan
Administrator  later  determines  the order is a  qualified  domestic  relations
order.

     To the extent it is not  inconsistent  with the provisions of the qualified
domestic relations order, the Advisory Committee at the election of an alternate
payee may direct the Trustee to invest any  partitioned  amount in a  segregated
subaccount or separate  account and to invest the account in Federally  insured,
interest-bearing  savings  account(s) or time  deposit(s)  (or a combination  of
both), or in other fixed income investments.  A segregated  subaccount remains a
part of the  Trust,  but it alone  shares in any  income it earns,  and it alone
bears any  expense or loss it incurs.  The  Trustee  will make any  payments  or
distributions  required  under this Section 6.07 by separate  benefit  checks or
other separate distribution to the alternate payee(s).

     6.08 ROLLOVER  DISTRIBUTIONS.  Notwithstanding any provision of the Plan to
the contrary that would  otherwise  limit a  distributee's  election  under this
Section,  a distributee may elect,  at the time and in the manner  prescribed by
the Plan Administrator, to have any portion of an eligible rollover distribution
paid directly to an eligible  retirement  plan specified by the distributee in a
direct  rollover.  For purposes of this Section 6.08, the following  definitions
shall apply.

          (a) ELIGIBLE ROLLOVER DISTRIBUTION:  An eligible rollover distribution
     is any  distribution  of all or any portion of the balance to the credit of
     the distributee,  except that an eligible  rollover  distribution  does not
     include:  any distribution  that is one of a series of substantially  equal
     periodic payments (not less frequently than annually) made for the life (or
     life  expectancy)  of the  distributee  and  the  distributee's  designated
     beneficiary,  or  for  a  specified  period  of  ten  years  or  more;  any
     distribution  to the extent such  distribution  is required  under  section
     401(a)(9)  of the Code;  and the  portion of any  distribution  that is not
     includible in gross income (determined  without regard to the exclusion for
     net unrealized appreciation with respect to employer securities).

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

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

          (d) DIRECT ROLLOVER:  A direct rollover is a payment by the Plan to an
     eligible retirement plan specified by the distributee.

                                  ARTICLE VII.
                       EMPLOYER ADMINISTRATIVE PROVISIONS

     7.01 INFORMATION TO COMMITTEE. The Employer must supply current information
to the Advisory  Committee as to the name,  date of birth,  date of  employment,
annual compensation, leaves of absence, Years of Service and date of termination
of  employment  of each  Employee  who is, or who will be eligible to become,  a
Participant  under  the Plan,  together  with any  other  information  which the
Advisory Committee considers necessary. The Employer's records as to the current
information the Employer  furnishes to the Advisory  Committee are conclusive as
to all persons.

     7.02 NO LIABILITY.  The Employer assumes no obligation or responsibility to
any of its Employees,  Participants or Beneficiaries  for any act of, or failure
to act,  on the part of its  Advisory  Committee  (unless  the  Employer  is the
Advisory Committee),  the Trustee or the Plan Administrator (unless the Employer
is the Plan Administrator).

     7.03 INDEMNITY OF COMMITTEE.  The Employer  indemnifies  and saves harmless
the Plan  Administrator and the members of the Advisory  Committee,  and each of
them,  from and against any and all loss  resulting  from liability to which the
Plan  Administrator and the Advisory  Committee,  or the members of the Advisory
Committee,  may be  subjected  by reason of any act or conduct  (except  willful
misconduct  or  gross   negligence)   in  their   official   capacities  in  the
administration of this Trust or Plan or both,  including all expenses reasonably
incurred in their  defense,  in case the Employer fails to provide such defense.
The  indemnification  provisions  of this  Section  7.03 do not relieve the Plan
Administrator  or any Advisory  Committee  member from any liability he may have
under ERISA for breach of a fiduciary duty. Furthermore,  the Plan Administrator
and the  Advisory  Committee  members  and the  Employer  may  execute  a letter
agreement  further  delineating  the  indemnification  agreement of this Section
7.03, provided the letter agreement must be consistent with and must not violate
ERISA. The indemnification provisions of this Section 7.03 extend to the Trustee
solely to the extent provided by a letter agreement  executed by the Trustee and
the Employer.

     7.04 EMPLOYER DIRECTION OF INVESTMENT. The Employer has the right to direct
the Trustee with respect to the investment and reinvestment of assets comprising
the Trust Fund only if the Trustee consents in writing to permit such direction.
If the Trustee consents to Employer direction of investment, the Trustee and the
Employer must execute a letter  agreement as a part of this Plan containing such
conditions,  limitations and other provisions they deem  appropriate  before the
Trustee  will follow any  Employer  direction  as  respects  the  investment  or
reinvestment of any part of the Trust Fund.

     7.05 AMENDMENT TO VESTING SCHEDULE.  Though the Employer reserves the right
to amend the vesting schedule at any time, the Advisory Committee will not apply
the amended  vesting  schedule to reduce the  Nonforfeitable  percentage  of any
Participant's Accrued Benefit derived from Employer contributions (determined as
of the later of the date the  Employer  adopts  the  amendment,  or the date the
amendment  becomes  effective)  to a  percentage  less  than the  Nonforfeitable
percentage computed under the Plan without regard to the amendment.

     If the Employer makes a permissible amendment to the vesting schedule, each
Participant  having at least 3 Years of Service  with the  Employer may elect to
have the percentage of his  Nonforfeitable  Accrued  Benefit  computed under the
Plan without regard to the  amendment.  The  Participant  must file his election
with the Plan  Administrator  within 60 days of the latest of (a) the Employer's
adoption of the amendment;  (b) the effective date of the amendment;  or (c) his
receipt  of a copy  of  the  amendment.  The  Plan  Administrator,  as  soon  as
practicable,  must forward a true copy of any amendment to the vesting  schedule
to each affected Participant,  together with an explanation of the effect of the
amendment,  the appropriate form upon which the Participant may make an election
to remain  under  the  vesting  schedule  provided  under the Plan  prior to the
amendment  and  notice of the time  within  which the  Participant  must make an
election  to remain  under the prior  vesting  schedule.  For  purposes  of this
Section 7.05, an amendment to the vesting  schedule  includes any Plan amendment
which  directly or  indirectly  affects the  computation  of the  Nonforfeitable
percentage of an Employee's rights to his Employer derived Accrued Benefit.

                                 ARTICLE VIII.
                      PARTICIPANT ADMINISTRATIVE PROVISIONS

     8.01  BENEFICIARY  DESIGNATION.  Any  Participant  may  from  time  to time
designate, in writing, any person or persons,  contingently or successively,  to
whom the Trustee  will pay his Accrued  Benefit  (including  any life  insurance
proceeds payable to the Participant's Account) in the event of his death and the
Participant may designate the form and method of payment. The Advisory Committee
will prescribe the form for the written designation of Beneficiary and, upon the
Participant's filing the form with the Advisory Committee,  the form effectively
revokes all  designations  filed prior to that date by the same  Participant.  A
Beneficiary designation by a Participant that was valid under the Profit Sharing
Plan  immediately  prior to the Effective  Date shall continue to be valid under
this  Plan as to the  Participant's  Accounts  transferred  to the Plan from the
Profit  Sharing Plan until revoked by the  Participant  in accordance  with this
Section 8.01.

     A married  Participant's  Beneficiary  designation  is not valid unless the
Participant's spouse consents, in writing, to the Beneficiary  designation.  The
spouse's consent must acknowledge the effect of that consent and a notary public
or the Plan Administrator (or his representative) must witness that consent. The
spousal  consent  requirements  of  this  paragraph  do not  apply  if:  (1) the
Participant and his spouse are not married through the one-year period ending on
the  date of the  Participant's  death;  (2)  the  Participant's  spouse  is the
Participant's sole primary  beneficiary;  (3) the Plan Administrator is not able
to locate the Participant's  spouse; (4) the Participant is legally separated or
has been abandoned  (within the meaning of State law) and the  Participant has a
court order to that  effect;  or (5) other  circumstances  exist under which the
Secretary  of  the  Treasury  will  excuse  the  consent  requirement.   If  the
Participant's  spouse is legally incompetent to give consent, the spouse's legal
guardian (even if the guardian is the Participant) may give consent.

     8.02  NO  BENEFICIARY  DESIGNATION.  If  a  Participant  fails  to  name  a
Beneficiary in accordance  with Section 8.01, or if the  Beneficiary  named by a
Participant predeceased him, then the Trustee will pay the Participant's Accrued
Benefit in accordance with Section 6.02 in the following order of priority to:

          (a) The Participant's surviving spouse;

          (b) The Participant's surviving children,  including adopted children,
     in equal shares;

          (c) The Participant's surviving parents, in equal shares; or

          (d) The legal representative of the estate of the Participant.

     If the Beneficiary does not predecease the  Participant,  but dies prior to
distribution of the Participant's  entire  Nonforfeitable  Accrued Benefit,  the
Trustee  will  pay  the  remaining   Nonforfeitable   Accrued   Benefit  to  the
Beneficiary's estate unless the Participant's  Beneficiary  Designation provides
otherwise.  The Advisory  Committee will direct the Trustee as to the method and
to whom the Trustee will make the payment under this Section 8.02.

     8.03 PERSONAL DATA TO COMMITTEE. Each Participant and each Beneficiary of a
deceased Participant must furnish to the Advisory Committee such evidence,  data
or information as the Advisory  Committee  considers  necessary or desirable for
the purpose of administering the Plan. The provisions of this Plan are effective
for the  benefit of each  Participant  upon the  condition  precedent  that each
Participant  will furnish  promptly full, true and complete  evidence,  data and
information  when  requested  by the Advisory  Committee,  provided the Advisory
Committee  advises each  Participant of the effect of his failure to comply with
its request.

     8.04 ADDRESS FOR  NOTIFICATION.  Each Participant and each Beneficiary of a
deceased Participant must file with the Advisory Committee from time to time, in
writing,  his post office  address and any change of post  office  address.  Any
communication,  statement or notice addressed to a Participant,  or Beneficiary,
at his last post office address filed with the Advisory  Committee,  or as shown
on the records of the Employer, binds the Participant,  or Beneficiary,  for all
purposes of this Plan.

     8.05  ASSIGNMENT  OR  ALIENATION.  Subject to Code  ss.414(p)  relating  to
qualified domestic relations orders, neither a Participant nor a Beneficiary may
anticipate, assign or alienate (either at law or in equity) any benefit provided
under  the Plan,  and the  Trustee  will not  recognize  any such  anticipation,
assignment or alienation.  Furthermore,  a benefit under the Plan is not subject
to attachment, garnishment, levy, execution or other legal or equitable process.

     8.06  NOTICE OF CHANGE IN TERMS.  The Plan  Administrator,  within the time
prescribed  by  ERISA  and  the   applicable   regulations,   must  furnish  all
Participants and Beneficiaries a summary  description of any material  amendment
to the Plan or notice of  discontinuance  of the Plan and all other  information
required by ERISA to be furnished without charge.

     8.07 LITIGATION  AGAINST THE TRUST. A court of competent  jurisdiction  may
authorize any appropriate  equitable relief to redress violations of ERISA or to
enforce  any  provisions  of ERISA or the terms of the  Plan.  A  fiduciary  may
receive  reimbursement  of  expenses  properly  and  actually  incurred  in  the
performance of his duties with the Plan.

     8.08 INFORMATION AVAILABLE.  Any Participant in the Plan or any Beneficiary
may examine copies of the Plan description, latest annual report, any bargaining
agreement, this Plan and Trust, contract or any other instrument under which the
Plan was established or is operated. The Plan Administrator will maintain all of
the items listed in this  Section 8.08 in his office,  or in such other place or
places  as he may  designate  from  time to time in  order  to  comply  with the
regulations  issued under ERISA,  for  examination  during  reasonable  business
hours.  Upon the  written  request  of a  Participant  or  Beneficiary  the Plan
Administrator  will  furnish him with a copy of any item listed in this  Section
8.08.  The Plan  Administrator  may make a reasonable  charge to the  requesting
person for the copy so furnished.

     8.09 APPEAL PROCEDURE FOR DENIAL OF BENEFITS.  The Plan  Administrator will
provide  adequate  notice in writing to any  Participant  or to any  Beneficiary
("Claimant")  whose claim for benefits under the Plan the Advisory Committee has
denied. The Plan Administrator's notice to the Claimant must set forth:

          (a) The specific reason for the denial;

          (b) Specific  references  to pertinent  Plan  provisions  on which the
     Advisory Committee based its denial;

          (c) A description of any additional  material and  information  needed
     for the  Claimant  to  perfect  his  claim  and an  explanation  of why the
     material or information is needed; and

          (d)  That  any  appeal  the  Claimant  wishes  to make of the  adverse
     determination  must be in writing to the Advisory  Committee within 75 days
     after receipt of the Plan Administrator's notice of denial of benefits. The
     Plan  Administrator's  notice must  further  advise the  Claimant  that his
     failure to appeal the action to the Advisory  Committee  in writing  within
     the 75 day period will render the Advisory Committee's determination final,
     binding and conclusive.

     If the Claimant  should appeal to the Advisory  Committee,  he, or his duly
authorized representative,  may submit, in writing, whatever issues and comments
he, or his duly authorized representative,  fees are pertinent. The Claimant, or
his duly authorized  representative,  may review  pertinent plan documents.  The
Advisory  Committee  will  reexamine  all facts related to the appeal and make a
final  determination as to whether the denial of benefits is justified under the
circumstances.  The Advisory  Committee must advise the Claimant of its decision
within 60 days of the  Claimant's  written  request for review,  unless  special
circumstances  (such as a hearing) would make the rendering of a decision within
the 60 day limit unfeasible, but in no event may the Advisory Committee render a
decision  respecting a denial for a claim for benefits later than 120 days after
its receipt of a request for review.

     The Plan  Administrator's  notice of denial of benefits  must  identify the
name of each member of the  Advisory  Committee  and the name and address of the
Advisory Committee member to whom the Claimant may forward his appeal.

                                  ARTICLE IX.
                    ADVISORY COMMITTEE - DUTIES WITH RESPECT
                            TO PARTICIPANT'S ACCOUNTS

     9.01 MEMBERS' COMPENSATION,  EXPENSES. The Sponsor must appoint an Advisory
Committee  to  administer  the  Plan,  the  members  of which  may or may not be
Participants in the Plan, or which may be the Plan  Administrator  acting alone.
The  members of the  Advisory  Committee  will serve  without  compensation  for
services  as such,  but the  Employer  will  pay all  expenses  of the  Advisory
Committee, including the expense for any bond required under ERISA.

     9.02  TERM.  Each  member  of  the  Advisory  Committee  serves  until  the
appointment of his successor.

     9.03  POWERS.  In case  of a  vacancy  in the  membership  of the  Advisory
Committee,  the remaining members of the Advisory Committee may exercise any and
all of the powers, authority,  duties and discretion conferred upon the Advisory
Committee pending the filling of the vacancy.

     9.04 GENERAL. The Advisory Committee,  in its sole and absolute discretion,
shall  have all  powers  necessary  to  discharge  its  duties  under  this Plan
including, without limitation, the following:

          (a) To select a  Secretary,  who need not be a member of the  Advisory
     Committee;

          (b)  To  determine  the  rights  of  eligibility  of  an  Employee  to
     participate in the Plan, the value of a  Participant's  Accrued Benefit and
     the Nonforfeitable percentage of each Participant's Accrued Benefit;

          (c) To adopt rules of  procedure  and  regulations  necessary  for the
     proper and efficient  administration of the Plan provided the rules are not
     inconsistent with the terms of this Plan;

          (d) To  construe  and  enforce the terms of the Plan and the rules and
     regulations it adopts,  including  interpretation of the Plan documents and
     documents related to the Plan's operation, and its decisions shall be final
     and binding on all interested persons;

          (e) To direct the Trustee as respects the crediting  and  distribution
     of the Trust;

          (f) To review and render  decisions  respecting a claim for (or denial
     of a claim for) a benefit under the Plan;

          (g) To furnish the Employer  with  information  which the Employer may
     require for tax or other purposes;

          (h) To engage the  service  of agents  whom it may deem  advisable  to
     assist it with the performance of its duties; and

          (i) To engage the  services of an  Investment  Manager or Managers (as
     defined in ERISA ss.3(38)), each of whom will have full power and authority
     to manage,  acquire or dispose  (or  direct  the  Trustee  with  respect to
     acquisition or disposition) of any Plan asset under its control.

     The  Advisory  Committee  must  exercise  all of  its  powers,  duties  and
discretion under the Plan in a uniform and nondiscriminatory manner.

     9.05 FUNDING  POLICY.  The Advisory  Committee will review,  not less often
than  annually,  all pertinent  Employee  information  and Plan data in order to
establish  the  funding  policy  of the Plan and to  determine  the  appropriate
methods of carrying  out the Plan's  objectives.  The  Advisory  Committee  must
communicate  periodically,  as it deems  appropriate,  to the Trustee and to any
Plan Investment  Manager the Plan's short-term and long-term  financial needs so
investment policy can be coordinated with Plan financial requirements.

     9.06 MANNER OF ACTION.  The decision of a majority of the members appointed
and qualified controls.

     9.07 AUTHORIZED  REPRESENTATIVE.  The Advisory  Committee may authorize any
person,  whether or not such person is a member of the  Advisory  Committee,  to
sign  on  its  behalf  any  notices,  directions,  applications,   certificates,
consents, approvals, waivers, letters or other documents. The Advisory Committee
must  evidence this  authority by an instrument  signed by all members and filed
with the Trustee.

     9.08 INTERESTED  MEMBER. No member of the Advisory  Committee may decide or
determine any matter concerning the distribution, nature or method of settlement
of his own benefits under the Plan,  except in exercising an election  available
to that member in his capacity as a Participant,  unless the Plan  Administrator
is acting alone in the capacity of the Advisory Committee.

     9.09 INDIVIDUAL ACCOUNTS.  The Advisory Committee will maintain,  or direct
the Trustee to maintain,  a separate Account, or multiple Accounts,  in the name
of each Participant to reflect the  Participant's  Accrued Benefit in accordance
with the  provisions of Article XV hereof and shall give the Trustee  directions
with respect to the  investment  of the Accounts of  Participants  in accordance
with the provisions of Article XV.

     9.10 INDIVIDUAL STATEMENT. As soon as practicable after the Accounting Date
of each Plan Year, but within the time  prescribed by ERISA and the  regulations
under ERISA,  the Plan  Administrator  will deliver to each  Participant (and to
each Beneficiary) a statement reflecting the condition of his Accrued Benefit in
the Trust as of that date and such other information ERISA requires be furnished
the Participant or Beneficiary. No Participant,  except a member of the Advisory
Committee,  has the right to inspect the records  reflecting  the Account of any
other Participant.

     9.11 ACCOUNT CHARGED.  The Advisory Committee will charge all distributions
made to a Participant or to his Beneficiary from his Account against the Account
of the Participant when made.

     9.12  UNCLAIMED  ACCOUNT  PROCEDURE.  The Plan does not require  either the
Trustee or the Advisory  Committee to search for, or ascertain  the  whereabouts
of,  any  Participant  or  Beneficiary.   At  the  time  the   Participant's  or
Beneficiary's  benefit  becomes  distributable  under  Article VI, the  Advisory
Committee,  by certified or registered  mail addressed to his last known address
of  record  with  the  Advisory  Committee  or the  Employer,  must  notify  the
Participant,  or Beneficiary,  that he is entitled to a distribution  under this
Plan.  The notice must quote the  provisions  of this Section 9.12 and otherwise
must comply with the notice  requirements of Article VI. If the Participant,  or
Beneficiary, fails to claim his distributive share or make his whereabouts known
in writing to the Advisory Committee within 6 months from the date of mailing of
the notice, the Advisory Committee will treat the Participant's or Beneficiary's
unclaimed payable Accrued Benefit as forfeited and will reallocate the unclaimed
payable Accrued  Benefit in accordance  with Section 3.05.  Where the benefit is
distributable to the Participant,  the forfeiture under this paragraph occurs as
of the  last  day of the  notice  period,  if the  Participant's  Nonforfeitable
Accrued  Benefit does not exceed  $5,000,  or as of the first day the benefit is
distributable  without the  Participant's  consent,  if the present value of the
Participant's  Nonforfeitable  Accrued Benefit exceeds $5,000. Where the benefit
is distributable to a Beneficiary,  the forfeiture occurs on the date the notice
period ends  except,  if the  Beneficiary  is the  Participant's  spouse and the
Nonforfeitable  Accrued  Benefit  payable  to the  spouse  exceeds  $5,000,  the
forfeiture  occurs as of the first day the benefit is distributable  without the
spouse's consent.  Pending  forfeiture,  the Advisory  Committee,  following the
expiration  of the  notice  period,  may direct the  Trustee  to  segregate  the
Nonforfeitable  Accrued  Benefit  in a  segregated  Account  and to invest  that
segregated  Account in Federally  insured  interest  bearing savings accounts or
time  deposits  (or  in a  combination  of  both),  or  in  other  fixed  income
investments.

     If a  Participant  or  Beneficiary  who has  incurred a  forfeiture  of his
Accrued Benefit under the provisions of the first paragraph of this Section 9.12
makes a claim,  at any time,  for his forfeited  Accrued  Benefit,  the Advisory
Committee must restore the  Participant's  or  Beneficiary's  forfeited  Accrued
Benefit to the same dollar  amount as the dollar  amount of the Accrued  Benefit
forfeited,  unadjusted for any gains or losses occurring  subsequent to the date
of the forfeiture.  The Advisory  Committee will make the restoration during the
Plan Year in which the  Participant or Beneficiary  makes the claim,  first from
the amount, if any, of Participant  forfeitures the Advisory Committee otherwise
would  allocate  for the Plan Year,  then from the amount,  if any, of the Trust
Fund net  income  or gain  for the Plan  Year  and  then  from  the  amount,  or
additional amount, the Employer  contributes to enable the Advisory Committee to
make the required restoration. The Advisory Committee will direct the Trustee to
distribute the Participant's or Beneficiary's restored Accrued Benefit to him no
later  than 60 days  after  the  close of the Plan  Year in which  the  Advisory
Committee restores the forfeited Accrued Benefit.  The forfeiture  provisions of
this  Section  9.12 apply solely to the  Participant's  or to the  Beneficiary's
Accrued Benefit derived from Employer contributions.

     9.13 INVESTMENT  MANAGER.  The Advisory  Committee shall have the right, as
provided in Section  9.04(i),  to appoint an  Investment  Manager for all or any
part of the assets of the Trust Fund as the Advisory  Committee shall designate,
provided  that any firm so appointed  shall be and continue  qualified to act as
such in accordance with ERISA. The Advisory  Committee may remove any Investment
Manager at any time, and need not specify any cause for such removal.

                                   ARTICLE X.
                                   [RESERVED]

                                  ARTICLE XI.
                    EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION

     11.01 EXCLUSIVE BENEFIT. Except as provided under Article III, the Employer
has no beneficial interest in any asset of the Trust and no part of any asset in
the Trust may ever  revert to or be repaid to an  Employer,  either  directly or
indirectly;  nor, prior to the  satisfaction of all liabilities  with respect to
the  Participants  and their  Beneficiaries  under the Plan, may any part of the
corpus or income of the Trust Fund, or any asset of the Trust,  be (at any time)
used for, or  diverted  to,  purposes  other than the  exclusive  benefit of the
Participants or their Beneficiaries.

     11.02 AMENDMENT BY EMPLOYER. Kansas City Southern Industries, Inc., by duly
adopted  resolution  of its  Board  of  Directors,  or of the  Compensation  and
Organization Committee of its Board of Directors,  has the right at any time and
from time to time:

          (a) To amend this Plan in any manner it deems  necessary  or advisable
     in order to qualify (or maintain  qualification of) this Plan and the Trust
     created under it under the appropriate provisions of Code ss.401(a); or

          (b) To amend this Plan in any other manner.

     No amendment  may authorize or permit any of the Trust Fund (other than the
part which is required to pay taxes and administration  expenses) to be used for
or diverted to purposes other than for the exclusive benefit of the Participants
or their  Beneficiaries or estates. No amendment may cause or permit any portion
of the  Trust  Fund to  revert  to or  become a  property  of the  Employer.  No
amendment may be made which affects the rights,  duties or  responsibilities  of
the  Trustee,  the Plan  Administrator  or the  Advisory  Committee  without the
written consent of the affected Trustee,  the Plan Administrator or the affected
member of the Advisory Committee.

     CODE SS.411(D)(6)  PROTECTED BENEFITS. An amendment (including the adoption
of  this  Plan  as a  restatement  of an  existing  plan)  may  not  decrease  a
Participant's  Accrued  Benefit,  except  to the  extent  permitted  under  Code
ss.412(c)(8),  and may not  reduce  or  eliminate  Code  ss.411(d)(6)  protected
benefits  determined  immediately  prior to the adoption date (or, if later, the
effective  date) of the  amendment.  An  amendment  reduces or  eliminates  Code
ss.411(d)(6)  protected  benefits if the  amendment has the effect of either (1)
eliminating or reducing an early retirement benefit or a retirement-type subsidy
(as  defined in  Treasury  regulations),  or (2) except as  provided by Treasury
regulations,  eliminating  an optional form of benefit.  The Advisory  Committee
must  disregard an amendment to the extent  application  of the amendment  would
fail to satisfy this  paragraph.  If the Advisory  Committee  must  disregard an
amendment  because the  amendment  would  violate  clause (1) or clause (2), the
Advisory  Committee must maintain a schedule of the early  retirement  option or
other  optional  forms  of  benefit  the Plan  must  continue  for the  affected
Participants.

     All amendments must be made in writing.  Each amendment must state the date
to which it is either retroactively or prospectively effective.

     11.03 DISCONTINUANCE.  Each Employer has the right, at any time, to suspend
or  discontinue  its  contributions  under the Plan.  The Board of  Directors of
Kansas City Southern  Industries,  Inc., or the  Compensation  and  Organization
Committee thereof, or any other duly authorized committee thereof, has the right
to  terminate,  at any time,  this Plan and the Trust created under it. The Plan
will terminate upon the first to occur of the following:

          (a) The date  terminated by action of the Board of Directors of Kansas
     City  Southern  Industries,  Inc.,  or the  Compensation  and  Organization
     Committee thereof, or any other duly authorized committee thereof; or

          (b) The date  Kansas City  Southern  Industries,  Inc.  is  judicially
     declared bankrupt or insolvent,  unless the proceeding authorized continued
     maintenance of the Plan.

     11.04 FULL VESTING ON TERMINATION.  Upon either full or partial termination
of the Plan, or, if applicable,  upon complete  discontinuance of profit sharing
plan contributions to the Plan, an affected  Participant's  right to his Accrued
Benefit is 100%  Nonforfeitable,  irrespective of the Nonforfeitable  percentage
which otherwise would apply under Article V.

     11.05 MERGER/DIRECT  TRANSFER. The Plan may not be a party to any merger or
consolidation  with another plan, or to a transfer of assets or  liabilities  to
another plan, unless  immediately  after the merger,  consolidation or transfer,
the surviving Plan provides each  Participant a benefit equal to or greater than
the  benefit  each  Participant  would  have  received  had the Plan  terminated
immediately  before  the  merger or  consolidation  or  transfer.  The  Advisory
Committee  possesses the specific  authority to enter into merger  agreements or
direct transfer of assets agreements with the trustees of other retirement plans
described in Code ss.401(a),  including an elective transfer,  and to accept the
direct  transfer of plan assets,  or to transfer plan assets,  as a party to any
such agreement.

     The  Advisory  Committee  may accept a direct  transfer  of plan  assets on
behalf  of an  Employee  prior to the date the  Employee  satisfies  the  Plan's
eligibility  conditions.  If the Advisory Committee accepts a direct transfer of
plan assets, the Advisory Committee must treat the Employee as a Participant for
all purposes of the Plan except the Employee is not a  Participant  for purposes
of sharing in Employer  contributions or Participant  forfeitures under the Plan
until he actually becomes a Participant in the Plan.

     The  Advisory  Committee  may not  consent  to,  or be a party to a merger,
consolidation  or transfer of assets with a defined  benefit  plan,  except with
respect  to  an  elective  transfer.  The  Trustee  will  hold,  administer  and
distribute  the  transferred  assets as a part of the Trust Fund and the Trustee
must maintain a separate  Employer  contribution  Account for the benefit of the
Employee on whose behalf the Advisory  Committee  accepted the transfer in order
to reflect the value of the transferred  assets.  Unless a transfer of assets to
this Plan is an elective transfer,  the Plan will preserve all Code ss.411(d)(6)
protected  benefits  with  respect to those  transferred  assets,  in the manner
described  in Section  11.02.  A transfer  is an elective  transfer  if: (1) the
transfer  satisfies the first paragraph of this Section 11.05;  (2) the transfer
is  voluntary,  under a fully  informed  election  by the  Participant;  (3) the
Participant  has an  alternative  that retains his Code  ss.411(d)(6)  protected
benefits  (including an option to leave his benefit in the  transferor  plan, if
that plan is not terminating); (4) the transfer satisfies the applicable spousal
consent  requirements  of the Code; (5) the transferor  plan satisfies the joint
and survivor notice  requirements of the Code, if the Participant's  transferred
benefit is subject to those  requirements;  (6) the  Participant  has a right to
immediate  distribution  from  the  transferor  plan,  in lieu  of the  elective
transfer;  (7) the transferred benefit is at least the greater of the single sum
distribution  provided by the  transferor  plan  payable at that  plan's  normal
retirement age; (8) the Participant  has a 100%  Nonforfeitable  interest in the
transferred  benefit;  and  (9)  the  transfer  otherwise  satisfies  applicable
Treasury regulations.  An elective transfer may occur between qualified plans of
any type.

     DISTRIBUTION  RESTRICTIONS  UNDER CODE  SS.401(K).  If the Plan  receives a
direct transfer (by merger or otherwise) of elective  contributions  (or amounts
treated  as  elective   contributions)  under  a  plan  with  a  Code  ss.401(k)
arrangement,  the  distribution  restrictions of Code  ss.ss.401(k)(2)  and (10)
continue to apply to those transferred elective contributions.

     11.06   TERMINATION.   Upon  termination  of  the  Plan,  the  distribution
provisions of Article VI remain operative, with the following exceptions:

          (1) if the present value of the Participant's  Nonforfeitable  Accrued
     Benefit  does not exceed  $5,000,  the Advisory  Committee  will direct the
     Trustee to distribute the Participant's  Nonforfeitable  Accrued Benefit to
     him in lump  sum as soon as  administratively  practicable  after  the Plan
     terminates; and

          (2) if the present value of the Participant's  Nonforfeitable  Accrued
     Benefit exceeds $5,000, the Participant or the Beneficiary,  in addition to
     the  distribution  events permitted under Article VI, may elect to have the
     Trustee commence distribution of his Nonforfeitable Accrued Benefit as soon
     as administratively practicable after the Plan terminates.

     To liquidate  the Trust,  the Advisory  Committee  will purchase a deferred
annuity  contract  for  each  Participant   which  protects  the   Participant's
distribution rights under the Plan, if the Participant's  Nonforfeitable Accrued
Benefit  exceeds  $5,000  and  the  Participant  does  not  elect  an  immediate
distribution  pursuant  to  Paragraph  (2).  The Trust will  continue  until the
Trustee  in  accordance  with  the  direction  of  the  Advisory  Committee  has
distributed all of the benefits under the Plan.

     On each valuation  date,  the Advisory  Committee will credit any part of a
Participant's Accrued Benefit retained in the Trust with its proportionate share
of the Trust's income, expenses, gains and losses, both realized and unrealized.
Upon  termination of the Plan, the amount,  if any, in a suspense  account under
Article  III will  revert to the  Employer,  subject  to the  conditions  of the
Treasury regulations  permitting such a reversion.  A resolution or amendment to
freeze all future benefit accrual but otherwise to continue  maintenance of this
Plan, is not a termination for purposes of this Section 11.06.

     Special  Rule  for  Deferral  Contributions  Account.  Notwithstanding  the
provisions of this Section 11.06, the Participant may not receive a distribution
of the portion of his  Nonforfeitable  Accrued Benefit  attributable to elective
contributions  under a Code ss.401(k)  arrangement  (or to amounts treated under
the Code  ss.401(k)  arrangement  as  elective  contributions)  pursuant  to the
termination of the Plan unless:  (a) the Participant  otherwise is entitled to a
distribution of that portion of his Nonforfeitable  Accrued Benefit;  or (b) the
Plan termination occurs without the establishment of a successor plan. A plan is
a successor plan under clause (b) if (i) the plan is a defined contribution plan
(other than an ESOP) maintained by the Employer (or by a related employer); (ii)
at  least  2% of the  Employees  who were  eligible  under  the Plan are or were
eligible under the successor plan at any time within the 24-month  period ending
after the time of  termination;  and (iii) the successor plan is in existence at
the time of the  termination of the Plan or within the period ending twelve (12)
months  after the final  distribution  of  assets  of the Plan.  A  distribution
pursuant  to  clause  (b),  must  be  part  of a lump  sum  distribution  to the
Participant of his Nonforfeitable Accrued Benefit.

                                  ARTICLE XII.
              PROVISIONS RELATING TO THE CODE SS.401(K) ARRANGEMENT

     12.01 CODE SS.401(K)  ARRANGEMENT.  The deferral  contributions and related
Employer  contributions  described in Section 3.01(A)  comprise a Code ss.401(k)
arrangement.   An  Employee  who  is  eligible  to  participate  in  the  401(k)
arrangement may file a salary reduction agreement with the Advisory Committee. A
salary reduction agreement must specify the amount of Compensation or percentage
of Compensation the Employee wishes to defer;  for which purpose  "Compensation"
shall be as defined in Section 1.10 but modified to exclude income  attributable
to the grant or exercise of employee  stock  options,  the vesting of restricted
property,  and such similar items of extraordinary  or non-cash  compensation as
the  Advisory  Committee  shall  prescribe.  Any  reference  in this  Section to
"Compensation"  is a  reference  to  such  definition  of  "Compensation"  as so
modified.

     A salary  reduction  agreement  executed by an eligible  Employee  shall be
effective as of the first day of the calendar quarter  specified by the Employee
in such agreement;  provided,  however,  that the agreement may not be effective
earlier than the following date which occurs last: (i) the execution date of the
Employee's salary reduction agreement;  (ii) the Employee's Plan Entry Date (or,
in the case of a reemployed  Employee,  his  reparticipation  date under Article
II); or (iii) the effective date of the Code ss.401(k)  arrangement.  The salary
reduction agreement will apply only to Compensation which is currently available
to the Employee after the effective date of the salary reduction agreement.

     If the salary  reduction  agreement  specifies  the  reduction  amount as a
percentage of Compensation, the percentage may not be less than one percent (1%)
of Compensation  and shall specify a reduction  percentage equal to an increment
of one percent (1%). If the salary reduction  agreement  specifies the reduction
amount as a dollar  amount of  Compensation,  the  dollar  amount  must equal an
increment of $5. An Employee's deferral  contributions for the Plan Year may not
exceed ten percent (10%) of his Compensation for the portion of the Plan Year in
which the Employee is actually a Participant.  Further, each individual deferral
contribution may not exceed ten percent (10%) of Compensation for the pay period
for which such deferral  contribution is calculated.  The Advisory Committee may
from time to time specify a maximum deferral  percentage for Highly  Compensated
Employees that is less than ten percent (10%). An Employee may modify his salary
reduction  agreement,  either to reduce or to  increase  the amount of  deferral
contributions,  as of the first day of any calendar quarter.  The Employee shall
make this  modification  by filing a new  salary  reduction  agreement  with the
Advisory  Committee.  An Employee may revoke a salary reduction  agreement as of
the first day of any  calendar  quarter.  An  Employee  who  revokes  his salary
reduction  agreement may file a new salary reduction  agreement  effective as of
the first day of the next calendar quarter.

     12.02 DEFINITIONS.

          (a)  "Highly  Compensated  Employee"  means an Eligible  Employee  who
     satisfies the definition in Section 1.07 of the Plan.

          (b) "Nonhighly Compensated Employee" means an eligible Employee who is
     not a Highly Compensated Employee.

          (c) "Eligible  Employee" means, for purposes of the ADP test described
     in Section  12.04,  an Employee who is eligible to make elective  deferrals
     for the Plan Year,  irrespective  of whether the  Employer  actually  makes
     deferral  contributions on behalf of the Employee.  For purposes of the ACP
     test described in Section 12.05, an "Eligible Employee" means a Participant
     who is eligible to receive an allocation of Employer matching contributions
     (or would be eligible  if he made the type of  contributions  necessary  to
     receive an allocation of matching  contributions)  and a Participant who is
     eligible  to  make  employee  contributions,  irrespective  of  whether  he
     actually  makes  employee  contributions.  An Employee  continues  to be an
     Eligible Employee during a period the Plan suspends the Employee's right to
     make elective deferrals or nondeductible contributions following a hardship
     distribution.

          (d) "Highly  Compensated  Group" means the group of Eligible Employees
     who are Highly Compensated Employees for the Plan Year.

          (e)  "Nonhighly   Compensated  Group"  means  the  group  of  Eligible
     Employees who are Nonhighly Compensated Employees for the Plan Year.

          (f) "Compensation" means, for purposes of any  nondiscrimination  test
     required   under  this   Article   XII,   Compensation   as   defined   for
     nondiscrimination  purposes in the last  paragraph  of Section  1.10 of the
     Plan.  Compensation  must  include  Compensation  for the entire Plan Year,
     irrespective  of whether the Code ss.401(k)  arrangement  was in effect for
     the entire Plan Year or whether the Employee  begins,  resumes or ceases to
     be an Eligible Employee during the Plan Year.

          (g)   "Deferral   contributions"   means  the  sum  of  the   deferral
     contributions  the  Employer  contributes  to the  Trust  on  behalf  of an
     Eligible Employee, pursuant to Section 3.01.

          (h) "Elective  deferrals" are the deferral  contributions the Employer
     contributes  to the Trust at the election of an Eligible  Employee.  If the
     Codess.401(k)  arrangement includes a cash or deferred feature, any portion
     of a cash or deferred contribution  contributed to the Trust because of the
     Employee's failure to make a cash election is an elective deferral, but any
     portion of a cash or deferred contribution over which the Employee does not
     have a cash election is not an elective deferral. Elective deferrals do not
     include amounts which have become currently available to the Employee prior
     to  the  election  nor  amounts   designated  as   nondeductible   employee
     contributions at the time of deferral or contribution.

          (i) "Matching contributions" are contributions made by the Employer on
     account of elective  deferrals  under a Code  ss.401(k)  arrangement  or on
     account of employee  contributions.  Matching  contributions  also  include
     Participant  forfeitures allocated on account of such elective deferrals or
     employee contributions.

          (j) "Nonelective contributions" are contributions made by the Employer
     which are not subject to a deferral  election by an Employee  and which are
     not matching contributions.

          (k)  "Qualified  matching  contributions"  are matching  contributions
     which are 100%  Nonforfeitable  at all times and which are  subject  to the
     distribution  restrictions described in paragraph (m). For purposes of this
     definition, matching contributions are not 100% Nonforfeitable at all times
     if the Employee has a 100% Nonforfeitable  interest because of his Years of
     Service taken into account under a vesting schedule.

          (l)   "Qualified    nonelective    contributions"    are   nonelective
     contributions  which  are 100%  Nonforfeitable  at all  times and which are
     subject to the  distribution  restrictions  described in paragraph (m). For
     purposes  of  this  definition,  nonelective  contributions  are  not  100%
     Nonforfeitable  at all  times  if the  Employee  has a 100%  Nonforfeitable
     interest because of his Years of Service taken into account under a vesting
     schedule.  Any  nonelective  contributions  allocated  to  a  Participant's
     Qualified  Nonelective  Contributions  Account under the Plan automatically
     satisfy the definition of qualified nonelective contributions.

          (m) "Distribution  restrictions"  means the Employee may not receive a
     distribution  of  the  specified   contributions  (nor  earnings  on  those
     contributions)  except  in  the  event  of  (1)  the  Participant's  death,
     disability,  termination  of  employment,  attainment  of age 59  1/2,  (2)
     financial  hardship  satisfying the requirements of  Codess.401(k)  and the
     applicable   Treasury   regulations,   (3)   plan   termination,    without
     establishment  of a  successor  defined  contribution  plan  (other than an
     ESOP), (4) a sale of substantially all of the assets (within the meaning of
     Codess.409(d)(2))  used in a trade or business, but only to an employee who
     continues employment with the corporation  acquiring those assets, or (5) a
     sale by a corporation  of its interest in a subsidiary  (within the meaning
     of Codess.409(d)(3)), but only to an employee who continues employment with
     the  subsidiary.  A  distribution  on account  of  financial  hardship,  as
     described  in clause (2),  may not include  earnings on elective  deferrals
     credited as of a date later than  December  31,  1988,  and may not include
     qualified matching  contributions and qualified nonelective  contributions,
     nor any earnings on such  contributions,  irrespective of when credited.  A
     distribution  described  in  clauses  (3),  (4) or (5),  must be a lump sum
     distribution, as required under Code ss.401(k)(10).

          (n) "Employee  contributions"  are contributions made by a Participant
     on an after-tax basis, whether voluntary or mandatory,  and designated,  at
     the time of contribution,  as an employee (or nondeductible)  contribution.
     Elective   deferrals   and   deferral   contributions   are  not   employee
     contributions.  Participant nondeductible  contributions,  made pursuant to
     Section 4.01 of the Plan, are employee contributions.

     12.03 ANNUAL ELECTIVE DEFERRAL LIMITATION.

     ANNUAL ELECTIVE DEFERRAL  LIMITATION.  An Employee's elective deferrals may
not exceed the 402(g) limitation. The 402(g) limitation is the greater of $7,000
or the adjusted  amount  determined  by the  Secretary of the  Treasury.  If the
Employer determines the Employee's elective deferrals to the Plan for a calendar
year would exceed the 402(g) limitation for the calendar year, the Employer will
not make any additional elective deferrals with respect to that Employee for the
remainder  of that  calendar  year,  paying in cash to the  Employee any amounts
which would result in the  Employee's  elective  deferrals for the calendar year
exceeding  the  402(g)  limitation.  If the  Advisory  Committee  determines  an
Employee's  elective  deferrals  already  contributed to the Plan for a calendar
year exceed the 402(g)  limitation,  the Advisory  Committee will distribute the
amount in excess of the 402(g) limitation (the "excess  deferral"),  as adjusted
for allocable income, no later than April 15 of the following  calendar year. If
the Advisory Committee  distributes the excess deferral by the appropriate April
15, it may make the distribution  irrespective of any other provision under this
Plan or under the Code. The Advisory  Committee will reduce the amount of excess
deferrals  for a calendar  year  distributable  to the Employee by the amount of
excess  contributions  (as  determined  in Section  12.04),  if any,  previously
distributed to the Employee for the Plan Year beginning in that calendar year.

     If an Employee  participates  in another plan under which he makes elective
deferrals pursuant to a Code ss.401(k)  arrangement,  elective deferrals under a
Simplified   Employee   Pension,   or  salary   reduction   contributions  to  a
tax-sheltered annuity,  irrespective of whether the Employer maintains the other
plan, he may provide the Advisory Committee a written claim for excess deferrals
made for a calendar  year.  The Employee must submit the claim no later than the
March 1 following the close of the  particular  calendar year and the claim must
specify the amount of the Employee's  elective  deferrals  under this Plan which
are excess deferrals. If the Advisory Committee receives a timely claim, it will
distribute the excess  deferral (as adjusted for allocable  income) the Employee
has  assigned  to this  Plan,  in  accordance  with the  distribution  procedure
described in the immediately preceding paragraph.

     ALLOCABLE INCOME. For purposes of making a distribution of excess deferrals
pursuant to this Section  12.03,  allocable  income means net income or net loss
allocable to the excess  deferrals  for the calendar  year in which the Employee
made the excess deferral and for the "gap period" measured from the beginning of
the next calendar year to the date of the  distribution.  If the distribution of
the excess  deferral  occurs during the calendar year in which the Employee made
the excess  deferral,  the Advisory  Committee  will treat as a "gap period" the
period from the first day of that calendar year to the date of the distribution.
The Advisory  Committee  will determine  allocable  income in the same manner as
described in Section 12.04 for excess contributions, except the numerator of the
allocation  fraction will be the amount of the Employee's  excess  deferrals and
the  denominator  of the  allocation  fraction  will be the  Employee's  Accrued
Benefit attributable to his elective deferrals.

     12.04 ACTUAL  DEFERRAL  PERCENTAGE  ("ADP") TEST.  For each Plan Year,  the
Advisory Committee must determine whether the Plan's Code ss.401(k)  arrangement
satisfies one of the following ADP tests:

          (i) The  average  ADP for the Highly  Compensated  Group for such Plan
     Year  does  not  exceed  1.25  times  the  average  ADP  of  the  Nonhighly
     Compensated Group for the preceding Plan Year; or

          (ii) The  average ADP for the Highly  Compensated  Group for such Plan
     Year does not exceed the average ADP for the  Nonhighly  Compensated  Group
     for the  preceding  Plan Year by more than two  percentage  points  (or the
     lesser  percentage  permitted  by the multiple  use  limitation  in Section
     12.06) and the average ADP for the Highly  Compensated  Group for such Plan
     Year is not more than twice the average ADP for the  Nonhighly  Compensated
     Group for the preceding Plan Year.

     If the Advisory  Committee so elects,  it may apply the limits set forth in
paragraphs  (i)  and  (ii) of this  Section  by  using  the  Average  ADP of the
Nonhighly  Compensated  Group for the Plan Year for which the  determination  is
made rather than for the  preceding  Plan Year;  provided that such election may
not be changed except as provided by the Secretary of the Treasury.

     CALCULATION  OF ADP.  The  average  ADP for a group is the  average  of the
separate  ADPs  calculated  for each  Eligible  Employee who is a member of that
group.  An Eligible  Employee's ADP for a Plan Year is the ratio of the Eligible
Employee's   deferral   contributions  for  the  Plan  Year  to  the  Employee's
Compensation for the Plan Year. A Nonhighly Compensated  Employee's ADP does not
include elective  deferrals made to this Plan or to any other Plan maintained by
the  Employer,  to the extent  such  elective  deferrals  exceed  the  ss.402(g)
limitation described in Section 12.03.

     The Advisory  Committee may determine (in a manner consistent with Treasury
regulations) the ADPs of the Eligible Employees by taking into account qualified
nonelective contributions or qualified matching contributions,  or both, made to
this  Plan or to any  other  qualified  Plan  maintained  by the  Employer.  The
Advisory  Committee may not include qualified  nonelective  contributions in the
ADP test unless the allocation of nonelective contributions is nondiscriminatory
when the Advisory  Committee  takes into account all  nonelective  contributions
(including the qualified  nonelective  contributions) and also when the Advisory
Committee  takes into account  only the  nonelective  contributions  not used in
either the ADP test described in this Section 12.04 or the ACP test described in
Section  12.05.  The  Advisory  Committee  may not  include  in the ADP test any
qualified  nonelective  contributions or qualified matching  contributions under
another qualified plan unless that plan has the same plan year as this Plan. The
Advisory Committee must maintain records to demonstrate  compliance with the ADP
test,  including  the  extent  to which  the  Plan  used  qualified  nonelective
contributions or qualified matching contributions to satisfy the test.

     SPECIAL AGGREGATION RULE FOR HIGHLY COMPENSATED EMPLOYEES. To determine the
ADP of any Highly Compensated  Employee,  the deferral  contributions taken into
account  must  include any  elective  deferrals  made by the Highly  Compensated
Employee under any other Code ss.401(k) arrangement  maintained by the Employer,
unless the elective  deferrals are to an ESOP. If the plans  containing the Code
ss.401(k)  arrangements  have different plan years, the Advisory  Committee will
determine  the combined  deferral  contributions  on the basis of the plan years
ending in the same calendar year.

     AGGREGATION OF CERTAIN CODE SS.401(K) ARRANGEMENTS.  If the Employer treats
two plans as a unit for  coverage or  nondiscrimination  purposes,  the Employer
must  combine  the Code  ss.401(k)  arrangements  under such plans to  determine
whether either plan satisfies the ADP test. This aggregation rule applies to the
ADP  determination  for all  Eligible  Employees,  irrespective  of  whether  an
Eligible Employee is a Highly  Compensated  Employee or a Nonhighly  Compensated
Employee.  An aggregation of Code  ss.401(k)  arrangements  under this paragraph
does not  apply to plans  which  have  different  plan  years  and the  Advisory
Committee  may not  aggregate  an ESOP (or the ESOP  portion  of a plan)  with a
non-ESOP plan (or non-ESOP portion of a plan).

     CHARACTERIZATION  OF EXCESS  CONTRIBUTIONS.  If,  pursuant to this  Section
12.04,  the  Advisory  Committee  has  elected  to  include  qualified  matching
contributions  in the average  ADP,  the  Advisory  Committee  will treat excess
contributions as attributable  proportionately to deferral  contributions and to
qualified  matching  contributions  allocated  on the  basis of  those  deferral
contributions.  If the total amount of a Highly  Compensated  Employee's  excess
contributions for the Plan Year exceeds his deferral  contributions or qualified
matching contributions for the Plan Years, the Advisory Committee will treat the
remaining  portion of his excess  contributions  as  attributable  to  qualified
nonelective  contributions.  The  Advisory  Committee  will reduce the amount of
excess  contributions  for a Plan  Year  distributable  to a Highly  Compensated
Employee by the amount of excess  deferrals  (as defined in Section  12.03),  if
any,  previously  distributed to that Employee for the  Employee's  taxable year
ending in that Plan Year.

     DISTRIBUTION OF EXCESS CONTRIBUTIONS.  If the Advisory Committee determines
the Plan fails to satisfy the ADP test for a Plan Year, it must  distribute  the
excess  contributions,  as adjusted for allocable  income,  during the next Plan
Year. However,  the Employer will incur an excise tax equal to 10% of the amount
of excess  contributions  for a Plan  Year not  distributed  to the  appropriate
Highly  Compensated  Employees  during  the first 2 1/2 months of that next Plan
Year. The excess contributions are the amount of deferral  contributions made by
the Highly  Compensated  Employees  which causes the Plan to fail to satisfy the
ADP test.  The Advisory  Committee  will  distribute to each Highly  Compensated
Employee  his  respective  share  of  the  excess  contributions.  The  Advisory
Committee  will  determine  the  respective  shares of excess  contributions  as
follows:

          STEP 1: The Advisory Committee shall first determine the dollar amount
     of the reductions which would have to be made to the elective  deferrals of
     each Highly Compensated  Employee who is a Participant for the Plan Year in
     order for the average ADP of the Highly Compensated Group for the Plan Year
     to satisfy  Section  401(k)(3) of the Code. Such amount shall be calculated
     by first determining the dollar amount by which the deferred  contributions
     of Highly Compensated  Employees who have the highest ADPs would have to be
     reduced until the first to occur of: (i) such  Employees'  ADPs would equal
     the ADPs of the Highly Compensated  Employee or group of Highly Compensated
     Employees with the next highest ADPs; or (ii) the average ADP of the Highly
     Compensated  Group,  as  recalculated  after the reductions made under this
     Step 1,  satisfies the  requirements  of Section  401(k)(3) of the Code and
     this Section.

          Then,  unless the recalculated  average ADP of the Highly  Compensated
     Group satisfies  Section 401(k)(3) of the Code, the reduction process shall
     be repeated by determining the amount of reductions  which would have to be
     made to the elective  deferrals of the Highly  Compensated  Employees  who,
     after all prior  reductions,  would have the highest ADP until the first to
     occur of: (iii) the ADP, after all prior  reductions  under this Step 1, of
     each  person in such group  would  equal the ADP of the Highly  Compensated
     Employee or group of Highly  Compensated  Employees  with the next  highest
     ADP;  or (iv) the average ADP of the Highly  Compensated  Group,  after the
     prior reductions,  satisfies the requirements of Code Section 401(k)(3) and
     this Section.  This process is repeated until the average ADP of the Highly
     Compensated Group, after all reductions, satisfies the requirements of Code
     Section 401(k)(3) and this Section.

          STEP 2:  Determine  the  total  dollar  amount  of  reductions  to the
     elective deferrals calculated under Step 1 ("TOTAL EXCESS DEFERRALS").

          STEP 3:  Reduce  the  elective  deferrals  of the  Highly  Compensated
     Employees  with the  highest  dollar  amount of elective  deferrals  by the
     lesser of the  dollar  amount  which  either (i)  causes  each such  Highly
     Compensated Employee's elective deferrals to equal the dollar amount of the
     elective  deferrals of the Highly  Compensated  Employee or group of Highly
     Compensated  Employees  with the next  highest  dollar  amount of  elective
     deferrals;  or (ii)  reduces  the Highly  Compensated  Employees'  elective
     deferrals by the Total Excess Deferrals.

          Then, unless the total amount of reductions made to Highly Compensated
     Employees'  elective  deferrals  under this Step 3 equals the amount of the
     Total Excess Deferrals, the reduction process shall be repeated by reducing
     the elective  deferrals of the group of Highly  Compensated  Employees with
     the highest dollar amount of elective deferrals, after the prior reductions
     made in this Step 3, by the lesser of the amount which either: (iii) causes
     such  Highly   Compensated   Employees'   elective  deferrals  after  prior
     reductions  made in this Step 3 to equal the dollar  amount of the elective
     deferrals of the Highly Compensated  Employees with the next highest dollar
     amount of elective deferrals;  or (iv) causes total reductions to equal the
     Total Excess Deferrals. This process is repeated with each successive group
     of Highly Compensated  Employees with the highest dollar amount,  after the
     prior  reductions,  of elective  deferrals until the total  reductions made
     under this Step 3 equal the Total Excess Deferrals.

     A  Participant's  elective  deferrals  required  to be  reduced  under this
Section shall be reduced in the following  order:  the  Participant's  unmatched
elective  deferrals  will be reduced  first,  and then,  if  necessary,  matched
elective  deferrals.  Matching  contributions  made  with  respect  to  elective
deferrals so reduced (other than  qualified  matching  contributions  treated as
elective deferrals for purposes of this Section) shall be forfeited.

     ALLOCABLE  INCOME.  To determine the amount of the corrective  distribution
required  under this Section  12.04,  the Advisory  Committee must calculate the
allocable income for the Plan Year in which the excess  contributions  arose and
for the "gap period"  measured  from the  beginning of the next Plan Year to the
date of the  distribution.  "Allocable  income" means net income or net loss. To
calculate allocable income for the Plan Year, the Advisory Committee:  (1) first
will  determine  the net  income  or net loss for the  Plan  Year on the  Highly
Compensated  Employee's Accrued Benefit attributable to deferral  contributions;
and (2)  then  will  multiply  this  net  income  or net  loss by the  following
fraction:

        Amount of the Highly Compensated Employee's Excess Contributions
        ----------------------------------------------------------------
             Accrued Benefit attributable to deferral contributions

The Accrued Benefit attributable to deferral  contributions includes the Accrued
Benefit   attributable  to  qualified   matching   contributions  and  qualified
nonelective  contributions  taken into account in the ADP test for the Plan Year
or for any prior Plan Year. For purposes of the denominator of the fraction, the
Advisory  Committee will calculate the Accrued Benefit  attributable to deferral
contributions  as of the last day of the Plan  Year  (without  regard to the net
income or net loss for the Plan Year on that Accrued Benefit).

     To calculate  allocable income for the "gap period," the Advisory Committee
will  perform the same  calculation  as described  in the  preceding  paragraph,
except in clause (1) the Advisory  Committee will determine,  as of the last day
of the month preceding the date of distribution,  the net income or net loss for
the  "gap  period"  and  in  clause  (2)  will  calculate  the  Accrued  Benefit
attributable to deferral contributions as of the day before the distribution. If
the Plan does not perform a valuation on the last day of the month preceding the
date of  distribution,  the  Advisory  Committee,  in  lieu  of the  calculation
described in this paragraph,  will calculate  allocable income for each month in
the "gap  period"  as equal to 10% of the  allocable  income  for the Plan Year.
Under this  alternate  calculation,  the Advisory  Committee  will disregard the
month in which the  distribution  occurs,  if the Plan makes the distribution no
later than the 15th day of that month.

     12.05 NONDISCRIMINATION RULES FOR EMPLOYER MATCHING  CONTRIBUTIONS/EMPLOYEE
CONTRIBUTIONS. The Advisory Committee must determine whether the annual Employer
matching  contributions (other than qualified matching contributions used in the
ADP test), if any, and the Employee  contributions,  if any,  satisfy one of the
following average contribution percentage ("ACP") test:

          (i) The ACP for the Highly  Compensated  Group for such Plan Year does
     not exceed 1.25 times the ACP of the  Nonhighly  Compensated  Group for the
     prior Plan Year; or

          (ii) The ACP for the High  Compensated  Group  for such Plan Year does
     not exceed the ACP for the Nonhighly  Compensated  Group for the prior Plan
     Year by more than two percentage points (or the lesser percentage permitted
     by the multiple use limitation in Section 12.06) and the ACP for the Highly
     Compensated Group for such Plan Year is not more than twice the ACP for the
     Nonhighly Compensated Group for the prior Plan Year.

     If the Advisory  Committee so elects,  it may apply the limits set forth in
paragraphs  (i)  and  (ii) of this  Section  by  using  the  Average  ACP of the
Nonhighly  Compensated  Group for the Plan Year for which the  determination  is
made rather than for the  preceding  Plan Year;  provided that such election may
not be  changed  except  as  provided  by the  Secretary  of the  Treasury.

     (A) CALCULATION OF ACP. The average contribution  percentage for a group is
the  average  of the  separate  contribution  percentages  calculated  for  each
Eligible  Employee  who is a  member  of  that  group.  An  Eligible  Employee's
contribution  percentage for a Plan Year is the ratio of the Eligible Employee's
aggregate contributions for the Plan Year to the Employee's Compensation for the
Plan Year.  "Aggregate  contributions"  are matching  contributions  (other than
qualified   matching   contributions   used  in  the  ADP  test)  and   employee
contributions.

     The Advisory Committee,  in a manner consistent with Treasury  regulations,
may determine the contribution  percentages of the Eligible  Employees by taking
into  account  qualified   nonelective   contributions   (other  than  qualified
nonelective  contributions used in the ADP test under Section 12.04) or elective
deferrals,  or both, made to this Plan or to any other qualified Plan maintained
by the Employer.  The Advisory  Committee may not include qualified  nonelective
contributions in the ACP test unless the allocation of nonelective contributions
is  nondiscriminatory  when  the  Advisory  Committee  takes  into  account  all
nonelective  contributions  (including the qualified nonelective  contributions)
and also when the Advisory  Committee  takes into  account only the  nonelective
contributions  not used in either the ADP test described in Section 12.04 or the
ACP test  described  in Section  12.05 The  Advisory  Committee  may not include
elective  deferrals in the ACP test, unless the Plan which includes the elective
deferrals  satisfies  the ADP test both with and without the elective  deferrals
included in this ACP test. For Plan Years beginning after December 31, 1989, the
Advisory  Committee  may not include in the ACP test any  qualified  nonelective
contributions  or elective  deferrals  under another  qualified plan unless that
plan has the same plan year as this Plan.  The Advisory  Committee must maintain
records to  demonstrate  compliance  with the ACP Test,  including the extent to
which the Plan used qualified nonelective contributions or elective deferrals to
satisfy the test.

     (B) SPECIAL AGGREGATION RULE FOR HIGHLY COMPENSATED EMPLOYEES. To determine
the contribution  percentage of any Highly Compensated  Employee,  the aggregate
contributions taken into account must include any matching  contributions (other
than  qualified  matching  contributions  used in the ADP test) and any employee
contributions  made on his behalf to any other plan  maintained by the Employer,
unless the other plan is an ESOP. If the plans have  different  plan years,  the
Advisory  Committee will determine the combined  aggregate  contributions on the
basis of the plan years ending in the same calendar year.

     (C)  AGGREGATION OF CERTAIN PLANS.  If the Employer treats two plans a unit
for coverage or nondiscrimination  purposes, the Employer must combine the plans
to determine  whether either plan satisfies the ACP test. This  aggregation rule
applies to the contribution percentage determination for all Eligible Employees,
irrespective of whether an Eligible Employee is a Highly Compensated Employee or
a Nonhighly  Compensated  Employee.  For Plan Years beginning after December 31,
1989, an aggregation of plans under this paragraph does not apply to plans which
have different  plan years and the Advisory  Committee may not aggregate an ESOP
(or the ESOP  portion of a plan) with a non-ESOP  plan (or  non-ESOP  portion of
plan).

     (D) DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS.  The Advisory Committee
will determine excess aggregate contributions after determining excess deferrals
under  Section  12.03 and  excess  contributions  under  Section  12.04.  If the
Advisory Committee  determines the Plan fails to satisfy the ACP test for a Plan
Year, it must  distribute the excess  aggregate  contributions,  as adjusted for
allocable income, during the next Plan Year. However, the Employer will incur an
excise tax equal to 10% of the amount of excess  aggregate  contributions  for a
Plan Year not distributed to the appropriate Highly Compensated Employees during
the  first  2  1/2  months  of  that  next  Plan  Year.  The  excess   aggregate
contributions  are the  amount of  aggregate  contributions  made by the  Highly
Compensated Employees which causes the Plan to fail to satisfy the ACP test. The
Advisory  Committee  will  distribute  to each Highly  Compensated  Employee his
respective share of the excess aggregate  contributions.  The Advisory Committee
will  determine  the  respective  shares of excess  aggregate  contributions  as
follows:

          STEP 1: The Advisory Committee shall first determine the dollar amount
     of  the   reductions   which  would  have  to  be  made  to  the  aggregate
     contributions of each Highly Compensated  Employee who is a Participant for
     the Plan Year in order for the average ACP of the Highly  Compensated Group
     for the Plan Year to satisfy  Section 401(m) of the Code. Such amount shall
     be calculated by first determining the dollar amount by which the aggregate
     contributions  of Highly  Compensated  Employees  who have the highest ACPs
     would have to be reduced  until the first to occur of: (i) such  Employees'
     ACPs would  equal the ACPs of the Highly  Compensated  Employee or group of
     Highly  Compensated  Employees  with the  next  highest  ACPs;  or (ii) the
     average ACP of the Highly  Compensated  Group,  as  recalculated  after the
     reductions  made under this Step 1, satisfies the  requirements  of Section
     401(m) of the Code and this Section.

          Then,  unless the recalculated  average ACP of the Highly  Compensated
     Group satisfies  Section 401(m) of the Code, the reduction process shall be
     repeated by  determining  the amount of  reductions  which would have to be
     made to the aggregate  contributions  of the Highly  Compensated  Employees
     who, after all prior reductions, would have the highest ACP until the first
     to occur of: (iii) the ACP, after all prior  reductions  under this Step 1,
     of each person in such group would equal the ACP of the Highly  Compensated
     Employee or group of Highly  Compensated  Employees  with the next  highest
     ACP;  or (iv) the average ACP of the Highly  Compensated  Group,  after the
     prior  reductions,  satisfies the  requirements  of Code Section 401(m) and
     this Section.  This process is repeated until the average ACP of the Highly
     Compensated Group, after all reductions, satisfies the requirements of Code
     Section 401(m) and this Section.

          STEP 2:  Determine  the  total  dollar  amount  of  reductions  to the
     aggregate   contributions   calculated   under   Step  1   ("TOTAL   EXCESS
     CONTRIBUTIONS").

          STEP 3: Reduce the aggregate  contributions of the Highly  Compensated
     Employees with the highest dollar amount of aggregate  contributions by the
     lesser of the  dollar  amount  which  either (i)  causes  each such  Highly
     Compensated  Employee's aggregate  contributions to equal the dollar amount
     of the aggregate  contributions of the Highly Compensated Employee or group
     of Highly  Compensated  Employees  with the next highest  dollar  amount of
     aggregate contributions;  or (ii) reduces the Highly Compensated Employees'
     aggregate contributions by the Total Excess Contributions.

          Then, unless the total amount of reductions made to Highly Compensated
     Employees'  aggregate  contributions under this Step 3 equals the amount of
     the Total Excess Contributions,  the reduction process shall be repeated by
     reducing the  aggregate  contributions  of the group of Highly  Compensated
     Employees with the highest dollar amount of aggregate contributions,  after
     the prior reductions made in this Step 3, by the lesser of the amount which
     either:   (iii)  causes  such  Highly  Compensated   Employees'   aggregate
     contributions  after  prior  reductions  made in this  Step 3 to equal  the
     dollar  amount of the  aggregate  contributions  of the Highly  Compensated
     Employees with the next highest  dollar amount of aggregate  contributions;
     or (iv) causes total reductions to equal the Total Excess  Deferrals.  This
     process  is  repeated  with each  successive  group of  Highly  Compensated
     Employees with the highest dollar amount,  after the prior  reductions,  of
     aggregate  contributions  until the total reductions made under this Step 3
     equal the Total Excess Contributions.

     (E)  ALLOCABLE   INCOME.   To  determine  the  amount  of  the   corrective
distribution  required  under this Section  12.05,  the Advisory  Committee must
calculate the allocable  income for the Plan Year in which the excess  aggregate
contributions  arose.  "Allocable  income"  means net  income  or net loss.  The
Advisory  Committee  will  determine  allocable  income  in the same  manner  as
described in Senior 12.04(F) for excess contributions.

     (F)  CHARACTERIZATION  OF  EXCESS  AGGREGATE  CONTRIBUTIONS.  The  Advisory
Committee will treat a Highly Compensated  Employee's  allocable share of excess
aggregate  contributions in the following priority: (1) first as attributable to
his employee contributions which are voluntary  contributions,  it any; (2) then
as  matching  contributions  allocable  with  respect  to  excess  contributions
determined  under  the ADP  test;  (3)  then on a pro  rata  basis  to  matching
contributions  and to the  deferral  contributions  relating  to those  matching
contributions  which the Advisory  Committee  has included in the ACP test;  (4)
then  on a  pro  rata  basis  to  employee  contributions  which  are  mandatory
contributions;  and (5) last to qualified nonelective  contributions used in the
ACP test.  To the extent  the Highly  Compensated  Employee's  excess  aggregate
contributions  are  attributable  to matching  contributions  and he is not 100%
vested in his  Accrued  Benefit  attributable  to  matching  contributions,  the
Advisory  Committee  will  distribute  only the vested  portion  and forfeit the
nonvested  portion.  The vested  portion of the  Highly  Compensated  Employee's
excess aggregate  contributions  attributable to Employer matching contributions
is the total  amount of such excess  aggregate  contributions  (as  adjusted for
allocable income) multiplied by his vested percentage (determined as of the last
day of the Plan Year for which the Employer made the matching contribution). The
Plan will allocate  forfeited excess aggregate  contributions to reduce Employer
matching contributions for the Plan Year in which the forfeiture occurs.

     12.06 MULTIPLE USE LIMITATION.  If at least one Highly Compensated Employee
is  includible  in the ADP  test  and in the  ACP  test,  the sum of the  Highly
Compensated Group's ADP and ACP may not exceed the multiple use limitation.

     The multiple use limitation for a Plan Year is the sum of (i) and (ii):

          (i) 125% of the  greater of (a) the ADP of the  Nonhighly  Compensated
     Group for the prior Plan Year under the Code ss.401(k) arrangement;  or (b)
     the ACP of the Nonhighly Compensated Group for the prior Plan Year.

          (ii) 2% plus the lesser of (i)(a) or  (i)(b),  but not more than twice
     the lesser of (i)(a) or (i)(b).

          The  Advisory  Committee,  in lieu of  determining  the  multiple  use
     limitation as the sum (i) and (ii), may elect to determine the multiple use
     limitation as the sum of (iii) and (iv):

          (iii) 125% of the lesser of: (a) the ADP of the Nonhighly  Compensated
     Group under the Code ss.401(k)  arrangement for the prior Plan Year; or (b)
     the ACP of the Nonhighly Compensated Group for the prior Plan Year.

          (iv) 2% plus the  greater of (iii)(a)  or  (iii)(b),  but no more than
     twice the greater of (iii)(a) or (iii)(b).

     If the Advisory  Committee so elects,  it may apply the limits set forth in
paragraphs  (i) and (ii) or (iii) and (iv) of this  Section by using the Average
ADP and ACP of the Nonhighly  Compensated  Group for the Plan Year for which the
determination  is made rather than for the  preceding  Plan Year;  provided that
such  election  may not be changed  except as provided by the  Secretary  of the
Treasury.

     This  Section  12.06 does not apply  unless,  prior to  application  of the
multiple use limitation, the ADP and ACP of the Highly Compensated Group for the
current  Plan Year  each  exceeds  125% of the  respective  percentages  for the
Nonhighly  Compensated  Group for the  prior  Plan  Year  (or,  if the  Advisory
Committee has made the election described in the previous paragraph, the current
Plan Year).

     The  Advisory  Committee  will  determine  whether the Plan  satisfies  the
multiple use limitation  after applying the ADP test under Section 12.04 and the
ACP test  under  Section  12.05 and after  making any  corrective  distributions
required by those Sections.  If, after applying this Section 12.06, the Advisory
Committee determines the Plan has failed to satisfy the multiple use limitation,
the Advisory Committee will correct the failure by treating the excess amount as
excess aggregate contributions under Section 12.05.

                                 ARTICLE XIII.
                                  MISCELLANEOUS

     13.01  EVIDENCE.  Anyone  required to give evidence  under the terms of the
Plan may do so by certificate,  affidavit,  document or other  information which
the person to act in reliance may consider pertinent,  reliable and genuine, and
to have been signed, made or presented by the proper party or parties.  Both the
Advisory  Committee  and the Trustee are fully  protected  in acting and relying
upon any evidence described under the immediately preceding sentence.

     13.02 NO  RESPONSIBILITY  FOR EMPLOYER ACTION.  Neither the Trustee nor the
Advisory  Committee  has any  obligation or  responsibility  with respect to any
action  required by the Plan to be taken by the  Employer,  any  Participant  or
eligible Employee, or for the failure of any of the above persons to act or make
any payment or contribution,  or to otherwise  provide any benefit  contemplated
under this  Plan.  Furthermore,  the Plan does not  require  the  Trustee or the
Advisory  Committee to collect any  contribution  required under the Plan, or to
determine the  correctness of the amount of any Employer  contribution.  Neither
the Trustee nor the Advisory  Committee need inquire into or be responsible  for
any action or failure to act on the part of the others.  Any action  required of
Kansas City Southern  Industries,  Inc.  must be by its Board of Directors,  the
Compensation and Organization  Committee of such Board, or the designees of such
Board or Committee.  Any action required of any other corporate Employer must be
by its Board of Directors or its designees.

     13.03 FIDUCIARIES NOT INSURERS.  The Trustee,  the Advisory Committee,  the
Plan Administrator and the Employer in no way guarantee the Trust Fund from loss
or depreciation.  The Employer does not guarantee the payment of any money which
may be or becomes due to any person from the Trust Fund.  The  liability  of the
Advisory  Committee  and the Trustee to make any payment  from the Trust Fund at
any time and all times is limited to the then available assets of the Trust.

     13.04  WAIVER OF NOTICE.  Any person  entitled to notice under the Plan may
waive the notice.

     13.05 SUCCESSORS. The Plan is binding upon all persons entitled to benefits
under the Plan,  their  respective  heirs  and legal  representatives,  upon the
Employer,  its  successors  and  assigns,  and upon the Trustee and the Advisory
Committee and their successors.

     13.06 WORD USAGE.  Words used in the  masculine  also apply to the feminine
where  applicable,  and  wherever the context of the Plan  dictates,  the plural
includes the singular and the singular includes the plural.

     13.07 STATE LAW.  Missouri law will  determine all  questions  arising with
respect  to the  provisions  of this  Plan  except  to the  extent  Federal  law
supersedes Missouri law.

     13.08  EMPLOYMENT NOT GUARANTEED.  Nothing  contained in this Plan, or with
respect to the  establishment  of the Trust, or any modification or amendment to
the Plan or Trust,  or in the  creation  of any  Account,  or the payment of any
benefit, gives any Employee,  Employee-Participant  or any Beneficiary any right
to continue  employment,  any legal or equitable right against the Employer,  or
Employee of the Employer, or against the Trustee, or its agents or employees, or
against the Plan  Administrator,  except as expressly  provided by the Plan, the
Trust, ERISA or by a separate agreement.

                                  ARTICLE XIV.
                                   [RESERVED]

                                  ARTICLE XV.
                   PARTICIPANT'S ACCOUNTS AND THEIR INVESTMENT

     15.01 INDIVIDUAL ACCOUNTS. The Advisory Committee shall maintain, or direct
the Trustee to maintain,  a separate Account, or multiple Accounts,  in the name
of each Participant to reflect the Participant's Accrued Benefit under the Plan.
Such Accounts  shall  include,  but not be limited to, a Deferral  Contributions
Account,  a Qualified  Nonelective  Contributions  Account,  a Regular  Matching
Contributions  Account, a Qualified Matching Contributions Account, and a Profit
Sharing Contributions Account.  Furthermore,  if a Participant reenters the Plan
subsequent to his having a Forfeiture Break in Service,  the Advisory Committee,
or the  Trustee,  shall  maintain  a  separate  Account  for  the  Participant's
pre-Forfeiture  Break in Service Accrued Benefit and a separate  Account for his
post-Forfeiture Break in Service Accrued Benefit unless the Participant's entire
Accrued Benefit under the Plan is one hundred percent (100%) Nonforfeitable. The
Advisory Committee will make its allocations, or request the Trustee to make its
allocations,  to the  Accounts  of  the  Participants  in  accordance  with  the
provisions of Section  15.05.  The Advisory  Committee may direct the Trustee to
maintain a temporary segregated  investment Account in the name of a Participant
to prevent a distortion of income, gain or loss allocations under Section 15.05.
The Advisory Committee shall maintain records of its activities.

     A Participant's Accrued Benefit shall be segregated for separate investment
when  and as so  expressly  provided  under  the  Plan.  Except  where  the Plan
expressly provides for such segregation, Participants' Accrued Benefits shall be
invested collectively.

     15.02  INVESTMENT  OF  ACCOUNTS.   Each  Participant's  Accounts  shall  be
invested, in accordance with the individual election of the Participant,  in one
or more  investment  vehicles  designated by the Advisory  Committee,  including
designated  pooled  investment  funds.  Effective  as of January  1, 2001,  such
investment vehicles shall include an employer stock fund consisting of shares of
common stock of KCSI.

     15.03 PARTICIPANT ACCOUNTS - INVESTMENT PERCENTAGES. The Advisory Committee
from time to time  shall  establish  procedures  by which each  Participant  may
specify  the   percentage  of  his  Accounts,   and  the  percentage  of  future
contributions to be made on his behalf,  to be invested in each of the available
investment vehicles for Accounts.  The investment percentage for each investment
vehicle selected by the Participant must be a multiple of 1%. The  Participant's
investment  direction  shall remain in effect  unless and until the  Participant
replaces  the  direction  in  accordance   with  the   established   procedures.
Contributions  and  Accounts  with respect to which no  affirmative  Participant
investment  direction has been made shall be invested in an  investment  vehicle
selected  by the  Advisory  Committee  and having as its primary  objective  the
generation of a high level of current income consistent with the preservation of
capital and a high degree of  liquidity.  The Trustee shall be  responsible  for
carrying out Participant investment direction.

     15.04  VALUATION  OF  PARTICIPANTS'  ACCRUED  BENEFITS.  The  value of each
Participant's  Accrued Benefit shall consist of the value of such  Participant's
Account(s),  including  any  segregated  account  hereunder.  For  purposes of a
distribution under the Plan, the value of a Participant's  Accrued Benefit shall
be its value as of the  valuation  date  immediately  preceding  the date of the
distribution.

     15.05  ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS. A "valuation
date" under this Plan is the last day of each  calendar  month and each  interim
valuation  date  determined  under  the  Trust.  As of each  valuation  date the
Advisory  Committee  must adjust  Accounts  to reflect net income,  gain or loss
since the last valuation date. The valuation  period is the period beginning the
day after the last valuation date and ending on the current valuation date.

     TRUST FUND ACCOUNTS.  The allocation  provisions of this paragraph apply to
all  Participant's  Accounts  other than  segregated  investment  Accounts.  The
Advisory Committee first will adjust the Participant Accounts, as those Accounts
stood at the beginning of the current valuation period, by reducing the Accounts
for any  forfeitures  arising  under  Section 5.09 or under  Section  9.12,  for
amounts  charged during the valuation  period to the Accounts in accordance with
Section 9.11 (relating to distributions) and for the amount of any Account which
the Trustee has fully  distributed  since the  immediately  preceding  valuation
date.  The  Advisory  Committee  then,  subject  to the  restoration  allocation
requirements  of Section 5.04 or of Section 9.12,  will allocate the net income,
gain or loss for the current  valuation period for each of the Plan's investment
vehicles (as specified by the Advisory  Committee pursuant to Section 15.02) pro
rata to the Participants  having accounts in each respective  investment vehicle
as the  accounts  stood  at the  beginning  of the  valuation  period.  Separate
allocations  and  adjustments  shall be made  with  respect  to each  investment
vehicle.  For each investment vehicle the allocable net income,  gain or loss is
the net income (or net loss),  including  the  increase  or decrease in the fair
market value of assets, since the last valuation date.

     SEGREGATED  INVESTMENT ACCOUNTS.  A segregated  investment Account receives
all  income  it earns  and  bears  all  expenses  or loss it  incurs.  As of the
valuation date, the Advisory  Committee must reduce a segregated Account for any
forfeiture  arising under Section 5.09 after the Advisory Committee has made all
other allocations, changes or adjustments to the Account for the Plan Year.

     ADDITIONAL  RULES. An Excess Amount or suspense account described in Part 2
of Article  III does not share in the  allocation  of net  income,  gain or loss
described  in this  Section  15.05.  This Section  15.05  applies  solely to the
allocation of net income, gain or loss of the Trust. The Advisory Committee will
allocate the Employer  contributions  and  Participant  forfeitures,  if any, in
accordance with Article III.

     15.06 PARTICIPANT  VOTING RIGHTS - EMPLOYER STOCK. Each Participant (or the
Beneficiary  thereof) acting as a named fiduciary shall have the right to direct
the  Trustee  as to the  manner in which (a) to vote any shares of stock of KCSI
allocated to his Accounts as of the  applicable  record date of any  shareholder
meeting in any matter put to a shareholder  vote; and (b) to respond to a tender
offer,  exchange  offer or any other  offer to  purchase  shares  of KCSI  stock
allocated to the Participant's Accounts.

     Before any meeting in which a shareholder vote is to be taken, the Employer
will deliver to the Trustee or its designee such quantities of proxy  soliciting
materials as are necessary to solicit voting instructions from the Participants.
The Trustee or its designee will mail the proxy solicitation  materials (and any
additional  material made available to other  shareholders  or otherwise  deemed
appropriate by the Trustee) to the Participants  within a reasonable time before
the meeting.  A  reasonable  deadline  for the return of such  materials  may be
specified.

     Shares  will be voted as  instructed  by the  Participants  on each  matter
brought before the meeting. Such participants are appointed as named fiduciaries
to direct the Trustee as to the voting of shares  allocated  to the  accounts of
Participants who have not timely instructed the Trustee how to vote them and any
unallocated  shares.  Such shares will be voted in the same  proportions  as the
shares for which the Trustee has received timely  instructions.  The Trustee may
submit to the Employer one summary proxy for the aggregate number of shares.

     With  regard to any  tender  offer,  exchange  offer or any other  offer to
purchase  shares of KCSI stock,  the Trustee or its  designee  will solicit such
instructions   from  Participants  by  distributing  to  each  Participant  such
information  as is  distributed to  shareholders  of the Employer,  generally in
connection with any such offer, and any additional information the trustee deems
appropriate  in order for each  Participant to give  instructions.  A reasonable
deadline for the return of such materials may be specified.

     Shares will, in response to a tender offer,  exchange  offer or other offer
to purchase,  be tendered,  exchanged or sold as instructed by the Participants.
Fractional  shares will be aggregated  for purposes of tendering,  exchanging or
selling  shares,  to the extent  possible,  to reflect the  instructions  of the
Participants. Such participants are appointed as named fiduciaries to direct the
Trustee as to the tender,  exchange or sale of shares allocated to an Account of
a Participant  who has not timely  instructed the Trustee how to respond to such
offer and any  unallocated  shares.  Such shares will be tendered,  exchanged or
sold in the same  proportion as shares for which the Trustee has received timely
instructions.

     For purposes of receiving,  tabulating and transmitting  instructions,  the
Trustee will  establish a procedure to insure that  instructions  received  from
individual  Participants  regarding  voting  or  responding  to a tender  offer,
exchange offer, or any other offer are held in confidence, and are not divulged,
released or otherwise  utilized in a manner that,  in the  Trustee's  reasonable
judgment,  might  influence  the  Participant's  free exercise of the rights set
forth in this Section 15.06.

                                  ARTICLE XVI.
               PROVISIONS EFFECTIVE UPON CHANGE IN CONTROL OF KCSI

     16.01  DEFINITIONS  OF "CHANGE IN CONTROL OF KCSI".  For  purposes  of this
Plan, a "Change in Control of KCSI" shall be deemed to have occurred if:

          (a) for any reason at any time less than seventy-five percent (75%) of
     the members of the Board of Directors of Kansas City  Southern  Industries,
     Inc., a Delaware corporation  ("KCSI"),  shall be individuals who fall into
     any of the following  categories:  (A) individuals who were members of such
     Board on September 1, 1995; (B) individuals  whose election,  or nomination
     for  election by KCSI's  stockholders,  was  approved by a vote of at least
     seventy-five percent (75%) of the members of the Board then still in office
     who were  members of such Board on September  1, 1995;  or (C)  individuals
     whose election,  or nomination for election,  by KCSI's  stockholders,  was
     approved by a vote of at least seventy-five percent (75%) of the members of
     the Board then still in office who were elected in the manner  described in
     (A) or (B) above, or

          (b) any "person" (as such term is used in Sections  13(d) and 14(d)(2)
     of the  Securities  Exchange Act of 1934 (the  "Exchange  Act")) shall have
     become after  September  1, 1995,  according  to a public  announcement  or
     filing,  without the prior  approval of the Board of Directors of KCSI, the
     "beneficial  owner"  (as  defined in Rule 13d-3  under the  Exchange  Act),
     directly or indirectly,  of securities of KCSI  representing  forty percent
     (40%) or more  (calculated  in accordance  with Rule 13d-3) of the combined
     voting power of KCSI's,  then outstanding  voting securities (such "person"
     hereinafter referred to as a "Major Stockholder of KCSI"); or

          (c)  the   stockholders   of  KCSI  shall  have   approved  a  merger,
     consolidation  or  dissolution  of  KCSI  or a  sale,  lease,  exchange  or
     disposition  of all or  substantially  all of  KCSI's  assets,  or a  Major
     Stockholder of KCSI shall have proposed any such  transaction,  unless such
     merger,  consolidation,  dissolution,  sale, lease, exchange or disposition
     shall have been  approved  by at least  seventy-five  percent  (75%) of the
     members of the Board of Directors of KCSI who are individuals  falling into
     any  combination  of the following  categories:  (i)  individuals  who were
     members of such Board of Directors on September 1, 1995,  (ii)  individuals
     whose  election,  or nomination  for election by KCSI's  stockholders,  was
     approved by at least seventy-five percent (75%) of the members of the Board
     of Directors then still in office who are members of the Board of Directors
     on September 1, 1995, or (iii) individuals whose election or nomination for
     election  by  KCSI's  stockholders  was  approved  by a  vote  of at  least
     seventy-five percent (75%) of the members of the Board then still in office
     who were elected in the manner described in (i) or (ii) above.

     16.02 PROVISIONS EFFECTIVE UPON CHANGE IN CONTROL. Upon a Change in Control
of KCSI as defined in Section 16.01,  notwithstanding what is otherwise provided
in this Plan, the following provisions will supersede the indicated sections and
otherwise govern the operation of the Plan from that point forward:

               (a) "Section 5.03, Vesting Schedule" shall provide as follows:

                    5.03  VESTING  SCHEDULE.  A  Participant's  Accrued  Benefit
               derived from Employer  contributions shall be one hundred percent
               (100%) Nonforfeitable at all times.

               (b) A new  section  numbered  "8.10"  and  entitled  "Participant
          Direction of Investment" shall be added to provide as follows:

                    8.10  PARTICIPANT  DIRECTION OF  INVESTMENT.  A  Participant
               shall have the right to direct the  Trustee  with  respect to the
               investment  of   reinvestment   of  the  assets   comprising  the
               Participant's  individual Account only if the Trustee consents in
               writing to permit such direction.  If the Trustee does consent to
               Participant  direction  of  investment,   the  Trustee  and  each
               Participant  shall  execute a letter  agreement as a part of this
               Plan containing such conditions, limitations and other provisions
               they  deem  appropriate  before  the  Trustee  shall  follow  any
               Participant  direction as respects the investment or reinvestment
               of any part of the Participant's  individual Account. The Trustee
               shall not be liable  for any  loss,  or by reason of any  breach,
               resulting from a Participant's direction of the investment of any
               part of his individual Account.

               (c)  Except for the right to amend the Plan  pursuant  to Section
          11.02(a),  the Employer shall not exercise its right to amend pursuant
          to Section  11.02(b),  discontinue  or  terminate  pursuant to Section
          11.03, or transfer assets of or merge,  pursuant to Section 11.05, the
          Plan without the prior  written  consent to such  aforesaid  action by
          seventy-five percent (75%) of the Participants on a per capita basis.

     16.03 RIGHT TO AMEND  ARTICLE  XVI PRIOR TO CHANGE IN CONTROL OF KCSI.  The
Board of Directors of KCSI, or any duly authorized  committee thereof,  reserves
the right to amend or  eliminate  this Article XVI prior to the date of a Change
in Control of KCSI.

                                 ARTICLE XVII.
                        PROVISIONS APPLICABLE TO ACCOUNTS
                      TRANSFERRED FROM FORMER MIDSOUTH PLAN

     17.01 MIDSOUTH ACCOUNTS. The Advisory Committee shall maintain, in order to
reflect  each  Participant's   Accrued  Benefit  under  the  Plan  derived  from
contributions to the MidSouth Rail Corporation  Thrift and Savings Plan ("Former
MidSouth Plan"), a separate MidSouth Deferral  Contributions Account, a separate
MidSouth  Other  Contributions  Account  and  a  separate  MidSouth  Participant
Contributions  Account  ("MidSouth  Accounts") for each  Participant  ("MidSouth
Participant")  in the Former  MidSouth  Plan who had an account under the Former
MidSouth  Plan  which  was   transferred  to  the  Former  Plan  and  thereafter
transferred  to this Plan,  except  that a MidSouth  Participant's  Contribution
Account  shall be  maintained  only for a MidSouth  Participant  who had such an
account under the Former  MidSouth  Plan.  The MidSouth  Deferral  Contributions
Account shall reflect a Participant's  Accrued Benefit derived from his deferral
contributions  to the  MidSouth  Plan,  the MidSouth  Participant  Contributions
Account  shall  reflect  a  Participant's   Accrued  Benefit  derived  from  his
participant  contributions  to the Former  MidSouth Plan, and the MidSouth Other
Contributions Account shall reflect a Participant's Accrued Benefit derived from
all  other  contributions  to  the  Former  MidSouth  Plan  on his  behalf.  The
provisions of this Article XVII shall govern the separate MidSouth Accounts, and
with  respect  to such  Accounts,  the  provisions  of this  Article  XVII shall
supersede any other  provisions in the Plan to the contrary.  Except as provided
under this Article XVII,  the Trustee shall hold,  administer and distribute the
MidSouth  Accounts  in the same  manner  under the Plan as the  similar  Account
derived from contributions to this Plan.

     The  provisions of this Article XVII shall not apply to any Accounts  other
than the MidSouth Accounts.

     A MidSouth  Participant's  Accrued  Benefit  is, at all times,  one hundred
percent (100%)  Nonforfeitable to the extent the value of his Accrued Benefit is
derived from the transfer to the Trust of his Account(s) in the Former  MidSouth
Plan.

     17.02 MIDSOUTH PARTICIPANT  CONTRIBUTION  ACCOUNTS.  The Advisory Committee
must maintain a separate  MidSouth  Participant  Contributions  Account for each
MidSouth  Participant  who had a  Participant  Contributions  Account  under the
Former MidSouth Plan to reflect the MidSouth Participant's Accrued Benefit under
the Plan derived from his participant contributions to the Former MidSouth Plan.
A  MidSouth   Participant's   Accrued   Benefit  derived  from  his  Participant
contributions as of any applicable date is the balance of his separate  MidSouth
Participant Contribution Account(s).

     A MidSouth Participant,  by giving prior written notice to the Trustee, may
withdraw  all or any  part of his  MidSouth  Participant  Contributions  Account
described in this Section  17.02. A  distribution  of Participant  contributions
must comply with the joint and survivor annuity  requirements  described in this
Article  XVII,  if those  requirements  apply to the MidSouth  Participant.  The
Trustee,  in  accordance  with the  direction  of the Advisory  Committee,  will
distribute  a  Participant's   unwithdrawn  MidSouth  Participant  Contributions
Account in accordance with the provisions of this Article XVII applicable to the
distribution  of  the  MidSouth  Participant's  Nonforfeitable  Accrued  Benefit
derived from his MidSouth Accounts.

     17.03  METHOD  OF  PAYMENT  OF  ACCRUED  BENEFIT.  Subject  to the  annuity
distribution  requirements,  if  any,  prescribed  by  Section  17.06,  and  any
restrictions  prescribed by Section 17.05, a MidSouth Participant or beneficiary
of a MidSouth Participant ("MidSouth Beneficiary") may elect distribution of his
MidSouth Accounts under one, or any combination, of the following methods:

          (a) by payment in a lump sum;

          (b) by payment in the form of a qualified joint and survivor  annuity,
     as defined in Section  17.06(A).  If, as of the annuity  starting date, the
     MidSouth  Participant  is married,  the MidSouth  Participant  may elect to
     receive a smaller annuity benefit,  having an actuarial value equivalent to
     the  actuarial  value of the  qualified  joint and survivor  annuity,  with
     continuation of payments to the surviving  spouse at a rate of seventy-five
     (75%) or one hundred  percent  (100%) of the rate  payable to the  MidSouth
     Participant during his lifetime.

     The distribution  options  permitted under this Section 17.03 are available
only if the present value of the MidSouth  Participant's  entire  Nonforfeitable
Accrued Benefit under the Plan, at the time of the  distribution to the MidSouth
Participant, exceeds $5,000.

     The provisions of Section  6.02(A) shall apply in  determining  the minimum
distribution requirements under Code ss.401(a)(9) for MidSouth Participants, and
the  provisions  of Section  6.02(B)  shall  apply in  determining  the  minimum
distribution requirements under Code ss.401(a)(9) for MidSouth Beneficiaries.

     17.04 TIME OF PAYMENT AND ACCRUED BENEFIT. Unless, pursuant to Section 6.03
or 17.05, the MidSouth Participant or the MidSouth Beneficiary elects in writing
a different  time or method of payment,  the Advisory  Committee will direct the
Trustee to  commence  distribution  of a MidSouth  Participant's  Nonforfeitable
Accrued  Benefit  derived from his  MidSouth  Accounts in  accordance  with this
Section  17.04.  A  MidSouth  Participant  must  consent,  in  writing,  to  any
distribution  required  under this  Section  17.04 if the  present  value of the
MidSouth  Participant's  Nonforfeitable  Accrued  Benefit,  at the  time  of the
distribution  to the  MidSouth  Participant,  exceeds  $5,000  and the  MidSouth
Participant  has not  attained  the  later of Normal  Retirement  Age or age 62.
Furthermore, the MidSouth Participant's spouse also must consent, in writing, to
any distribution for which Section 17.06 requires the spouse's consent.  For all
purposes of Article VI and this Article XVII,  the term "annuity  starting date"
means the first day of the first  period for which the Plan pays an amount as an
annuity or in any other form.  For  purposes of the consent  requirements  under
this  Article  XVII,  if  the  present  value  of  the  MidSouth   Participant's
Nonforfeitable  Accrued Benefit derived from his MidSouth Accounts,  at the time
of any  distribution,  exceeds  $5,000 the  Advisory  Committee  must treat that
present  value  as  exceeding   $5,000  for  purposes  of  all  subsequent  Plan
distributions to the MidSouth Participant.

     (A) Separation from Service for a Reason Other Than Death.

               (1) MIDSOUTH  PARTICIPANT'S  NONFORFEITABLE  ACCRUED  BENEFIT NOT
          EXCEEDING  $5,000.  If  the  MidSouth  Participant's  Separation  from
          Service is for any reason  other than death,  the  Advisory  Committee
          will  direct the  Trustee to  distribute  the  MidSouth  Participant's
          Nonforfeitable Accrued Benefit derived from his MidSouth Accounts in a
          lump  sum as soon as  administratively  practicable  after  the  first
          distribution  valuation  date  following  the  MidSouth  Participant's
          Separation  from  Service,  but in no  event  later  than the 60th day
          following the close of the Plan Year in which the MidSouth Participant
          attains  Normal  Retirement  Age.  If  the  MidSouth  Participant  has
          attained  Normal  Retirement Age when he separates  from Service,  the
          distribution  under this  paragraph  will occur no later than the 60th
          day  following  the  close of the  Plan  Year in  which  the  MidSouth
          Participant's Separation from Service occurs.

               (2) MIDSOUTH PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT EXCEEDS
          $5,000. If the MidSouth  Participant's  Separation from Service is for
          any reason other than death,  the Advisory  Committee  will direct the
          Trustee  to  distribute  the  MidSouth  Participant's   Nonforfeitable
          Accrued  Benefit  derived from his MidSouth  Accounts in a form and at
          the time  elected by the  MidSouth  Participant,  pursuant  to Section
          17.05. In the absence of an election by the MidSouth Participant,  the
          Advisory  Committee will direct the Trustee to distribute the MidSouth
          Participant's Nonforfeitable Accrued Benefit derived from his MidSouth
          Accounts in a lump sum (or, if applicable,  the normal annuity form of
          distribution  required under Section 17.06), on the 60th day following
          the close of the Plan Year in which the latest of the following events
          occurs:  (a) the MidSouth  Participant  attains Normal Retirement Age;
          (b) the  MidSouth  Participant  attains  age 62;  or (c) the  MidSouth
          Participant's Separation from Service.

               (3)  DISABILITY.  If the MidSouth  Participant's  Separation from
          Service is because of disability,  the Advisory  Committee will direct
          the Trustee to pay the MidSouth  Participant's  Nonforfeitable Accrued
          Benefit in lump sum (or, if  applicable,  the normal  annuity  form of
          distribution    required   under   Section   17.06),    as   soon   as
          administratively  practicable after the first  distribution  valuation
          date  following the MidSouth  Participant's  Separation  from Service,
          subject to the notice and consent  requirements  of this  Article XVII
          and  to the  applicable  mandatory  commencement  dates  described  in
          Paragraph (1) or in Paragraph (2) of this Section 17.04(A).

     (B) REQUIRED  BEGINNING  DATE.  The  provisions  of Section  6.01(B)  shall
determine a MidSouth Participant's Required Beginning Date.

     (C) DEATH OF THE MIDSOUTH  PARTICIPANT.  The Advisory Committee will direct
the Trustee,  in  accordance  with this Section  17.04(C),  to distribute to the
MidSouth  Participant's  Beneficiary the MidSouth  Participant's  Nonforfeitable
Accrued Benefit derived from his MidSouth Accounts remaining in the Trust at the
time of the MidSouth Participant's death. Subject to the requirements of Section
17.06,  the Advisory  Committee will determine the death benefit by reducing the
MidSouth Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth
Accounts  by any  security  interest  the Plan has against  that  Nonforfeitable
Accrued Benefit  derived from his MidSouth  Accounts by reason of an outstanding
MidSouth Participant loan.

          (1) DECEASED  MIDSOUTH  PARTICIPANT'S  NONFORFEITABLE  ACCRUED BENEFIT
     DOES NOT EXCEED $5,000. The Advisory Committee, subject to the requirements
     of Section  17.06,  must  direct the  Trustee to  distribute  the  deceased
     MidSouth  Participant's  Nonforfeitable  Accrued  Benefit  derived from his
     MidSouth  Accounts  in a  single  cash  sum,  as soon  as  administratively
     practicable  after the first  distribution  valuation  date  following  the
     MidSouth  Participant's  death or, if later, the date on which the Advisory
     Committee  receives  notification  of or  otherwise  confirms  the MidSouth
     Participant's death.

          (2) DECEASED  MIDSOUTH  PARTICIPANT'S  NONFORFEITABLE  ACCRUED BENEFIT
     EXCEEDS  $5,000.   The  Advisory  Committee  will  direct  the  Trustee  to
     distribute  the  deceased  MidSouth  Participant's  Nonforfeitable  Accrued
     Benefit  derived  from his  MidSouth  Accounts  at the time and in the form
     elected by the  MidSouth  Participant  or, if  applicable,  by the MidSouth
     Beneficiary,  as permitted  under this Article  XVII.  In the absence of an
     election,  subject to the  requirements  of  Section  17.06,  the  Advisory
     Committee will direct the Trustee to distribute the MidSouth  Participant's
     undistributed  Nonforfeitable  Accrued  Benefit  derived  from his MidSouth
     Accounts in a lump sum as soon as  administratively  practicable  after the
     first  distribution  valuation  date  following the MidSouth  Participant's
     death or,  if later,  the date on which  the  Advisory  Committee  receives
     notification of or otherwise confirms the MidSouth Participant's death.

          If the death benefit is payable in full to the MidSouth  Participant's
     surviving  spouse,  the surviving  spouse,  in addition to the distribution
     options provided in this Section  17.04(C),  may elect  distribution at any
     time or in any form  (other  than the  joint  and  survivor  annuity)  this
     Article XVII would permit for a MidSouth Participant.

     (D)  ROLLOVERS.  The provisions of Section 6.08 shall apply to the MidSouth
Accounts.

     17.05 BENEFIT PAYMENT ELECTIONS.  Not earlier than 90 days before nor later
than 30 days before the MidSouth  Participant's  annuity starting date, the Plan
Administrator  must provide a benefit  notice to a MidSouth  Participant  who is
eligible to make an election under this Section  17.05.  The benefit notice must
explain  the  optional  forms of benefit  in the Plan,  including  the  material
features and relative  values of those options,  and the MidSouth  Participant's
right to defer  distribution until he attains the later of Normal Retirement Age
or age 62.

     Such  distribution  may commence less than 30 days after the benefit notice
is given, provided that:

          (1) the Plan  Administrator  clearly informs the Participant  that the
     Participant has a right to a period of at least 30 days after receiving the
     notice to consider the  decision of whether or not to elect a  distribution
     (and, of applicable, a particular distribution option), and

          (2) the Participant,  after receiving the notice, affirmatively elects
     a distribution.

     If a  MidSouth  Participant  or  MidSouth  Beneficiary  makes  an  election
prescribed by this Section 17.05, the Advisory Committee will direct the Trustee
to distribute the MidSouth Participant's  Nonforfeitable Accrued Benefit derived
from his MidSouth Accounts in accordance with that election.  Any election under
this  Section is subject to the  requirements  of Section  17.06.  The  MidSouth
Participant  or MidSouth  Beneficiary  must make an election  under this Section
17.05 by filing his election form with the Advisory Committee at any time before
the Trustee  otherwise  would commence to pay a MidSouth  Participant's  Accrued
Benefit derived from his MidSouth  Accounts in accordance with the  requirements
of Articles VI and XVII.

     (A) MIDSOUTH PARTICIPANT ELECTIONS AFTER SEPARATION FROM SERVICE.

     If the present  value of a MidSouth  Participant's  Nonforfeitable  Accrued
Benefit exceeds $5,000,  he may elect to have the Trustee commence  distribution
as soon as  administratively  practicable after any distribution  valuation date
following  the MidSouth  Participant's  Separation  from  Service.  The MidSouth
Participant may reconsider an election at any time prior to the annuity starting
date and elect to commence  distribution as of any other  distribution date, but
not earlier than the date described in the first sentence of this Paragraph (A).
Following his attainment of Normal  Retirement  Age, a MidSouth  Participant who
has separated from Service may elect  distribution as of any distribution  date,
irrespective  of  the  restrictions  otherwise  applicable  under  this  Section
17.05(A).  If the  MidSouth  Participant  is  partially  vested  in his  Accrued
Benefit,  an  election  under  this  Paragraph  (A) to  distribute  prior to the
MidSouth  Participant's  incurring a Forfeiture  Break in Service (as defined in
Section  5.08) must be in the form of a  cash-out  distribution  (as  defined in
Article V). A MidSouth  Participant may not receive a cash-out  distribution if,
prior to the time the Trustee  actually  makes the  cash-out  distribution,  the
MidSouth Participant returns to employment with the Employer.

     (B) MIDSOUTH PARTICIPANT ELECTIONS PRIOR TO SEPARATION FROM SERVICE.

     In  addition  to the  distribution  options  provided  in Section  6.03,  a
MidSouth Participant, until he retires, has a continuing election to receive all
or any portion of his MidSouth Deferral  Contributions  Account and his MidSouth
Other  Contributions  Accounts  if: (a) he has attained age 59 1/2 and (b) he is
100% vested in the Account.  The procedures  set forth in Section  6.03(B) shall
apply.

     (C) DEATH BENEFIT ELECTIONS.

     If the present value of the deceased MidSouth Participant's  Nonforfeitable
Accrued Benefit exceeds $5,000, the MidSouth Participant's Beneficiary may elect
to have the Trustee distribute the MidSouth Participant's Nonforfeitable Accrued
Benefit  derived  from  his  MidSouth  Accounts  in a form  and  within a period
permitted under Section 17.04. The MidSouth Beneficiary's election is subject to
any  restrictions  designated  in writing by the  MidSouth  Participant  and not
revoked as of his date of death.

     (D) TRANSITIONAL ELECTIONS.

     Notwithstanding the provisions of Sections 17.03 and 17.04, if the MidSouth
Participant (or MidSouth Beneficiary) signed a written distribution  designation
prior to January 1, 1984, the Advisory  Committee  must  distribute the MidSouth
Participant's   Nonforfeitable   Accrued   Benefit  in   accordance   with  that
designation,  subject, however, to the survivor requirements,  if applicable, of
Sections  17.06,  17.07 and 17.08.  This  Section  17.05(D)  does not apply to a
pre-1984  distribution  designation,  and the Advisory Committee will not comply
with  that  designation,  if any of the  following  applies:  (1) the  method of
distribution  would have  disqualified  the Plan under Code ss.  401(a)(9) as in
effect on  December  31,  1983;  (2) the  MidSouth  Participant  did not have an
Accrued Benefit as of December 31, 1983; (3) the  distribution  designation does
not specify the timing and form of the distribution and the death  Beneficiaries
(in order of priority);  (4) the substitution of a MidSouth Beneficiary modifies
the payment  period of the  distribution;  or (5) the MidSouth  Participant  (or
MidSouth Beneficiary) modifies or revokes the distribution  designation.  In the
event of a revocation,  the Plan must  distribute,  no later than December 31 of
the  calendar  year  following  the year of  revocation,  the  amount  which the
MidSouth   Participant  would  have  received  under  Section  17.04(A)  if  the
distribution  designation had not been in effect or, if the MidSouth Beneficiary
revokes the distribution designation,  the amount which the MidSouth Beneficiary
would have received under Section 17.04(C) if the  distribution  designation had
not been in effect.  The Advisory  Committee will apply this Section 17.05(D) to
rollovers  and  transfers in  accordance  with Part J of the Code ss.  401(a)(9)
Treasury regulations.

     (E) HARDSHIP DISTRIBUTIONS.

     The  provisions  of  Section  6.03(E)  shall  apply to  permit  a  MidSouth
Participant  to  receive  hardship  distributions  from  his  MidSouth  Deferral
Contributions Account.

     17.06 ANNUITY DISTRIBUTIONS TO MIDSOUTH PARTICIPANTS AND SURVIVING SPOUSES.

     (A) JOINT AND  SURVIVOR  ANNUITY.  The Advisory  Committee  must direct the
Trustee to distribute a MidSouth  Participant's  Nonforfeitable  Accrued Benefit
derived from his MidSouth Accounts in the form of a qualified joint and survivor
annuity,   unless  the  MidSouth  Participant  makes  a  valid  waiver  election
(described  in Section  17.07)  within the 90-day  period  ending on the annuity
starting date. If, as of the annuity starting date, the MidSouth  Participant is
married, a qualified joint and survivor annuity is an immediate annuity which is
purchasable  with the  MidSouth  Participant's  Nonforfeitable  Accrued  Benefit
derived  from his  MidSouth  Account and which  provides a life  annuity for the
MidSouth  Participant  and a survivor  annuity payable for the remaining life of
the MidSouth  Participant's  surviving  spouse equal to 50% of the amount of the
annuity  payable  during  the life of the  MidSouth  Participant.  If, as of the
annuity  starting  date, the MidSouth  Participant  is not married,  a qualified
joint and  survivor  annuity  is an  immediate  life  annuity  for the  MidSouth
Participant which is purchasable with the MidSouth Participant's  Nonforfeitable
Accrued  Benefit  derived from his MidSouth  Accounts.  On or before the annuity
starting date, the Advisory Committee,  without MidSouth  Participant or spousal
consent,   must   direct  the   Trustee  to  pay  the   MidSouth   Participant's
Nonforfeitable  Accrued  Benefit derived from his MidSouth  Accounts,  in a lump
sum,  in lieu of a  qualified  joint and  survivor  annuity in  accordance  with
Section 17.04, if the MidSouth  Participant's  Nonforfeitable Accrued Benefit is
not greater than $5,000.

     (B) PRERETIREMENT  SURVIVOR ANNUITY. If a married MidSouth Participant dies
prior to his  annuity  starting  date the  Advisory  Committee  will  direct the
Trustee to  distribute  a portion of the MidSouth  Participant's  Nonforfeitable
Accrued Benefit derived from his MidSouth Accounts to the MidSouth Participant's
surviving  spouse in the form of a preretirement  survivor  annuity,  unless the
MidSouth Participant has a valid waiver election (as described in Section 17.08)
in effect,  or unless the MidSouth  Participant  and his spouse were not married
throughout the one year period ending on the date of his death. A  preretirement
survivor  annuity is an annuity  which is  purchasable  with 50% of the MidSouth
Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth Accounts
(determined  as of the date of the  MidSouth  Participant's  death) and which is
payable for the life of the MidSouth  Participant's  surviving spouse. The value
of the preretirement  survivor annuity is attributable to Employer contributions
and  to  Employee   contributions   in  the  same  proportion  as  the  MidSouth
Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth Accounts
is   attributable   to  those   contributions.   The  portion  of  the  MidSouth
Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth Accounts
not  payable  under this  paragraph  is payable  to the  MidSouth  Participant's
Beneficiary,  in accordance  with the other  provisions of this Article XVII. If
the present value of the preretirement  survivor annuity does not exceed $5,000,
the Advisory Committee,  on or before the annuity starting date, must direct the
Trustee to make a lump sum distribution to the MidSouth Participant's  surviving
spouse, in lieu of a preretirement survivor annuity.

     (C) SURVIVING SPOUSE  ELECTIONS.  If the present value of the preretirement
survivor annuity exceeds $5,000, the MidSouth Participant's surviving spouse may
elect to have the Trustee commence payment of the preretirement survivor annuity
at any time  following  the date of the MidSouth  Participant's  death,  but not
later than the mandatory  distribution  periods  described in Section 17.04, and
may  elect  any form of  payment  described  in  Section  17.03,  in lieu of the
preretirement  survivor annuity.  In the absence of an election by the surviving
spouse,  the  Advisory  Committee  must  direct the  Trustee to  distribute  the
preretirement  survivor  annuity on the first  distribution  date  following the
close of the Plan Year in which the latest of the following  events occurs:  (i)
the MidSouth  Participant's death; (ii) the date the Advisory Committee receives
notification of or otherwise  confirms the MidSouth  Participant's  death, (iii)
the date the MidSouth  Participant would have attained Normal Retirement Age; or
(iv) the date the MidSouth Participant would have attained age 62.

     (D) SPECIAL RULES. If the MidSouth Participant has in effect a valid waiver
election regarding the qualified joint and survivor annuity or the preretirement
survivor annuity,  the Advisory  Committee must direct the Trustee to distribute
the  MidSouth  Participant's  Nonforfeitable  Accrued  Benefit  derived from his
MidSouth  Accounts in  accordance  with  Sections  17.03,  17.04 and 17.05.  The
Advisory Committee will reduce the MidSouth Participant's Nonforfeitable Accrued
Benefit derived from his MidSouth Accounts by any security interest (pursuant to
any offset rights  authorized by Section  17.10) held by the Plan by reason of a
MidSouth  Participant loan to determine the value of the MidSouth  Participant's
Nonforfeitable  Accrued Benefit derived from his MidSouth Accounts distributable
in the form of a qualified joint and survivor annuity or preretirement  survivor
annuity,  provided any  post-August 18, 1985, loan satisfied the spousal consent
requirement  described  in Section  17.10 of the Plan.  For purposes of applying
this Article XVII, the Advisory Committee treats a former spouse as the MidSouth
Participant's  spouse or the  surviving  spouse to the extent  provided  under a
qualified  domestic relations order described in Section 6.07. The provisions of
this Article XVII apply separately to the portion of the MidSouth  Participant's
Nonforfeitable Accrued Benefit derived from his MidSouth Accounts subject to the
qualified   domestic  relations  order  and  to  the  portion  of  the  MidSouth
Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth Accounts
not subject to that order.

     (E)  LIMITED  APPLICATION  OF SECTION.  The  preceding  provisions  of this
Section 17.06 apply only to (1) a MidSouth Participant as respects whom the Plan
is a direct  or  indirect  transferee  from a plan  subject  to the Code  ss.417
requirements and the Plan received the transfer after December 31, 1984,  unless
the transfer is an elective transfer  described in Section 11.05; (2) a MidSouth
Participant who is eligible to and who elects a life annuity  distribution;  and
(3) a MidSouth  Participant  whose  benefits  under a defined  benefit  plan are
offset by benefits provided under this Plan. Sections 17.07 and 17.08 only apply
to MidSouth  Participants to whom the preceding provisions of this Section 17.06
apply.

     17.07 WAIVER ELECTION-QUALIFIED JOINT AND SURVIVOR ANNUITY. Within 90 days,
but not later than 30 days, before the MidSouth  Participant's  annuity starting
date,  the Advisory  Committee  must provide the MidSouth  Participant a written
explanation  of the terms and  conditions  of the  qualified  joint and survivor
annuity,  the  MidSouth  Participant's  right to make,  and the  effect  of,  an
election  to waive the joint and  survivor  form of  benefit,  the rights of the
MidSouth  Participant's  spouse regarding the waiver election,  and the MidSouth
Participant's  right to  make,  and the  effect  of,  a  revocation  of a waiver
election.  The Plan does not limit the number of times the MidSouth  Participant
may revoke a waiver of the  qualified  joint and survivor  annuity or make a new
waiver during the election period.

     A married  MidSouth  Participant's  waiver election is not valid unless (a)
the MidSouth Participant's spouse (to whom the survivor annuity is payable under
the qualified joint and survivor  annuity),  after the MidSouth  Participant has
received the written explanation  described in this Section 17.07, has consented
in writing to the waiver election,  the spouse's consent acknowledges the effect
of  the  election,  and a  notary  public  or the  Plan  Administrator  (or  his
representative)  witnesses the spouse's consent,  (b) the spouse consents to the
alternate  form of payment  designated  by the  MidSouth  Participant  or to any
change in that  designated  form of  payment,  and (c)  unless the spouse is the
MidSouth Participant's sole primary MidSouth Beneficiary, the spouse consents to
the  MidSouth  Participant's  Beneficiary  designation  or to any  change in the
MidSouth Participant's Beneficiary designation. The spouse's consent to a waiver
of the qualified joint and survivor annuity is irrevocable,  unless the MidSouth
Participant  revokes  the waiver  election.  The  spouse  may  execute a blanket
consent to any form of payment  designation  or to any  Beneficiary  designation
made by the MidSouth Participant,  if the spouse acknowledges the right to limit
that consent to a specific  designation but, in writing,  waives that right. The
consent  requirements  of this  Section  17.07  apply  to a former  spouse  of a
MidSouth  Participant,  to  the  extent  required  under  a  qualified  domestic
relations order described in Section 6.07.

     The Advisory  Committee  will accept as valid a waiver  election which does
not  satisfy  the  spousal  consent   requirements  if  the  Advisory  Committee
establishes  the  MidSouth  Participant  does not have a  spouse,  the  Advisory
Committee is not able to locate the MidSouth  Participant's spouse, the MidSouth
Participant is legally  separated or has been  abandoned  (within the meaning of
State law) and the MidSouth  Participant  has a court order to that  effect,  or
other  circumstances exist under which the Secretary of the Treasury will excuse
the  consent  requirement.  If the  MidSouth  Participant's  spouse  is  legally
incompetent  to give consent,  the spouse's legal guardian (even if the guardian
is the MidSouth Participant) may give consent.

     17.08  WAIVER  ELECTION -  PRERETIREMENT  SURVIVOR  ANNUITY.  The  Advisory
Committee  must  provide a written  explanation  of the  preretirement  survivor
annuity to each married MidSouth Participant,  within the following period which
ends last:  (1) the period  beginning on the first day of the Plan Year in which
the MidSouth  Participant  attains age 32 and ending on the last day of the Plan
Year in which the MidSouth  Participant  attains age 34; (2) a reasonable period
after an Employee becomes a MidSouth Participant;  (3) a reasonable period after
the joint and survivor rules become applicable to the MidSouth  Participant;  or
(4) a reasonable time after a fully subsidized preretirement survivor annuity no
longer satisfies the requirements of a fully  subsidized  benefit.  A reasonable
period  described in clauses (2), (3) and (4) is the period  beginning  one year
before  and  ending  one  year  after  the  applicable  event.  If the  MidSouth
Participant  separates from Service  before  attaining age 35, clauses (1), (2),
(3) and (4) do not apply and the  Advisory  Committee  must  provide the written
explanation  within the  period  beginning  one year  before and ending one year
after the Separation from Service.  The written explanation must describe,  in a
manner  consistent  with Treasury  Regulations,  the terms and conditions of the
preretirement  survivor  annuity  comparable to the explanation of the qualified
joint and survivor annuity required under Section 17.06. The Plan does not limit
the  number  of times  the  MidSouth  Participant  may  revoke  a waiver  of the
preretirement survivor annuity or make a new waiver during the election period.

     A MidSouth  Participant's  waiver  election of the  preretirement  survivor
annuity  is not valid  unless  (a) the  MidSouth  Participant  makes the  waiver
election no later than the first day of the Plan Year in which he attains age 35
and (b) the MidSouth  Participant's  spouse (to whom the preretirement  survivor
annuity is payable)  satisfies  the consent  requirements  described  in Section
17.06,  except the spouse need not consent to the form of benefit payable to the
designated  MidSouth  Beneficiary.  The  spouse's  consent  to the waiver of the
preretirement  survivor annuity is irrevocable,  unless the MidSouth Participant
revokes the waiver  election.  Irrespective of the time of election  requirement
described  in clause (a), if the  MidSouth  Participant  separates  from Service
prior to the first day of the Plan Year in which he attains age 35, the Advisory
Committee will accept a waiver  election as respects the MidSouth  Participant's
Accrued  Benefit  attributable  to his  Service  prior to this  Separation  from
Service.  Furthermore,  if a MidSouth Participant who has separated from Service
makes a valid waiver election,  except for the timing requirement of clause (a),
the Plan  Administrator  will accept that election as valid,  but only until the
first day of the Plan Year in which the MidSouth  Participant  attains age 35. A
waiver  election  described in this paragraph is not valid unless made after the
MidSouth  Participant  has  received the written  explanation  described in this
Section 17.08.

     17.09  COORDINATION WITH SURVIVOR  REQUIREMENTS.  If the joint and survivor
requirements of Article XVII apply to the MidSouth Participant,  neither Section
8.01 nor this Section 17.09 impose any special spousal  consent  requirements on
the MidSouth Participant's  Beneficiary designation.  However, in the absence of
spousal  consent  (as  required  by  Articles  VI  and  XVII)  to  the  MidSouth
Participant's Beneficiary designation:  (1) any waiver of the joint and survivor
annuity or of the  preretirement  survivor  annuity is not valid; and (2) if the
MidSouth  Participant  dies prior to his annuity  starting  date,  the  MidSouth
Participant's  Beneficiary  designation  will apply  only to the  portion of the
death  benefit  which  is  not  payable  as a  preretirement  survivor  annuity.
Regarding  clause  (2),  if the  MidSouth  Participant's  surviving  spouse in a
primary Beneficiary under the MidSouth  Participant's  Beneficiary  designation,
the Trustee  will satisfy the  spouse's  interest in the MidSouth  Participant's
death  benefit  first  from the  portion  which is  payable  as a  preretirement
survivor annuity.

     17.10 PARTICIPANT LOANS.  Effective for Plan Years beginning after December
31, 1993, the Trustee shall not make any new loans to MidSouth  Participants  or
MidSouth  Beneficiaries.  This Section 17.10 specifically authorizes the Trustee
to maintain loans made on a nondiscriminatory basis to a MidSouth Participant or
to a MidSouth  Beneficiary in accordance with the loan policy established by the
Advisory Committee under the Former MidSouth Plan, provided: (1) the loan policy
satisfies  the  requirements  of Section  9.04;  (2) loans are  available to all
MidSouth  Participants  and MidSouth  Beneficiaries  on a reasonably  equivalent
basis and are not available in a greater amount for Highly Compensated Employees
than  for  other  Employees;  (3) any loan is  adequately  secured  and  bears a
reasonable  rate of  interest;  (4) the loan  provides  for  repayment  within a
specified period of time; (5) the default provisions of the note prohibit offset
of the MidSouth  Participant's  Nonforfeitable Accrued Benefit prior to the time
the Trustee otherwise would distribute the MidSouth Participant's Nonforfeitable
Accrued  Benefit;  (6) the  amount of the loan does not  exceed (at the time the
Plan  extends  the  loan)  the  present  value  of  the  MidSouth  Participant's
Nonforfeitable  Accrued Benefit derived from his MidSouth Accounts;  and (7) the
loan otherwise conforms to the exemption provided by Code ss.4975(d)(1).  If the
joint  and  survivor   requirements  of  Article  XVII  apply  to  the  MidSouth
Participant,  the MidSouth Participant may not pledge any portion of his accrued
Benefit as security for a loan made after August 18, 1985, unless, within the 90
day  period  ending  on the date the  pledge  becomes  effective,  the  MidSouth
Participant's  spouse,  if any, consents (in a manner described in Section 17.06
other than the  requirement  relating to the consent of a subsequent  spouse) to
the security or, by separate consent, to an increase in the amount of security.

     The  Advisory  Committee,  to the extent  provided in a written loan policy
adopted  under the Former  MidSouth  Plan,  will treat a loan made to a MidSouth
Participant as a MidSouth Participant direction of investment under this Section
17.10. To the extent of the loan outstanding at any time, the borrowing MidSouth
Participant's  Account  alone  shares in any interest  paid on the loan,  and it
alone  bears any  expense  or loss it incurs in  connection  with the loan.  The
Trustee may retain any  principal  or interest  paid on the  borrowing  MidSouth
Participant's  loan in an interest bearing  segregated  Account on behalf of the
borrowing MidSouth Participant until the Trustee deems it appropriate to add the
amount paid to the MidSouth Participant's separate Account under the Plan.

     (A) DEFAULT ON A LOAN. If a MidSouth  Participant  or MidSouth  Beneficiary
defaults  on a loan made  pursuant  to a loan  policy  adopted  by the  Advisory
Committee  of the  Former  MidSouth  Plan,  the Plan  treats  the  default  as a
distributable  event. The Trustee,  at the time of the default,  will reduce the
MidSouth Participant's  Nonforfeitable Accrued Benefit derived from his MidSouth
Accounts by the lesser of the amount in default (plus  accrued  interest) or the
Plan's security interest in that Nonforfeitable Accrued Benefit derived from his
MidSouth  Accounts.  To the  extent  the loan is  attributable  to the  MidSouth
Participant's  Deferral  Contributions  Account in the Former MidSouth Plan, the
Trustee  will not  reduce  the  MidSouth  Participant's  Nonforfeitable  Accrued
Benefit derived from his MidSouth  Accounts unless the MidSouth  Participant has
separated  from Service or unless the MidSouth  Participant  has attained age 59
1/2.

     17.10 VESTING SCHEDULE FOR REPAID AMOUNTS. If a former MidSouth Participant
in the Former  MidSouth Plan received a cash-out  distribution  when he was less
than 100% vested and repays his  distribution  pursuant  to Section  5.04 of the
Former  MidSouth Plan, his Accrued  Benefit shall be, at all times,  one hundred
percent (100%)  Nonforfeitable to the extent the value of his Accrued Benefit is
derived from his MidSouth Accounts.

                                 ARTICLE XVIII.
                        PROVISIONS APPLICABLE TO ACCOUNTS
                      TRANSFERRED FROM FORMER GATEWAY PLAN

     18.01 GATEWAY ACCOUNTS.  The Advisory Committee shall maintain, in order to
reflect  each  Participant's   Accrued  Benefit  under  the  Plan  derived  from
contributions  to the Gateway  Western 401(k) Plan ("Former  Gateway  Plan"),  a
separate Gateway  Deferral  Contributions  Account,  a separate Gateway Rollover
Contributions Account, a separate Gateway Voluntary Contributions Account, and a
separate Gateway Matching  Contributions  Account ("Gateway  Accounts") for each
Participant  in the  Former  Gateway  Plan  ("Gateway  Participant")  who had an
account  under  the  Former  Gateway  Plan,   except  that  a  Gateway  Rollover
Contributions Account shall be maintained only for a Gateway Participant who had
such  an  account  under  the  Former  Gateway  Plan,  and a  Gateway  Voluntary
Contributions Account shall be maintained only for a Gateway Participant who had
such  an  account  under  the  Former   Gateway  Plan.   The  Gateway   Deferral
Contributions Account shall reflect a Participant's Accrued Benefit derived from
his deferral  contributions  to the Former  Gateway Plan,  the Gateway  Rollover
Contributions Account shall reflect a Participant's Accrued Benefit derived from
his rollover  contributions  to the Former Gateway Plan,  the Gateway  Voluntary
Contributions Account shall reflect a Participant's Accrued Benefit derived from
his voluntary after-tax contributions to the Former Gateway Plan and the Gateway
Matching  Contributions  Account shall reflect a  Participant's  Accrued Benefit
derived  from all  matching  contributions  to the  Former  Gateway  Plan on his
behalf.  The provisions of this Article XVIII shall govern the separate  Gateway
Accounts,  and with respect to such  Accounts,  the  provisions  of this Article
XVIII shall supersede any other  provisions in the Plan to the contrary.  Except
as provided  under this Article  XVIII,  the Trustee shall hold,  administer and
distribute the Gateway Accounts in the same manner under the Plan as the similar
Account derived from contributions to this Plan.

     The  provisions of this Article XVIII shall not apply to any Accounts other
than the Gateway Accounts.

     A Gateway Participant's early retirement age under the Plan shall be 55.

     18.02 SPECIAL  WITHDRAWAL  RIGHTS. A Gateway  Participant,  by giving prior
written  notice to the  Trustee,  may  withdraw  all or any part of his  Gateway
Voluntary  Contributions  Account  described in this Section  18.02 at any time,
provided,  however,  that a Gateway  Participant  may make no more than two such
withdrawals in any 12-month  period.  A distribution of voluntary  contributions
must comply with the joint and survivor annuity  requirements  described in this
Article  XVIII,  if those  requirements  apply to the Gateway  Participant.  The
Trustee,  in  accordance  with the  direction  of the Advisory  Committee,  will
distribute a Participant's  unwithdrawn Gateway Voluntary  Contributions Account
in  accordance  with the  provisions  of this Article  XVIII  applicable  to the
distribution of the Gateway Participant's Nonforfeitable Accrued Benefit derived
from his Gateway Accounts.

     18.03  METHOD  OF  PAYMENT  OF  ACCRUED  BENEFIT.  Subject  to the  annuity
distribution  requirements,  if  any,  prescribed  by  Section  18.06,  and  any
restrictions   prescribed  by  Section  18.05,  a  Gateway  Participant  or  the
beneficiary  of  a  Gateway  Participant   ("Gateway   Beneficiary")  may  elect
distribution  of his  Gateway  Accounts  under one, or any  combination,  of the
following methods:

          (a) by payment in a lump sum;

          (b) by payment in the form of a single life annuity;

          (c) by  payment  in the form of a single  life  annuity  with  certain
     periods of five, ten, or fifteen years;

          (d) by payment in the form of a single life annuity  with  installment
     refund;

          (e) by payment in the form of a qualified joint and survivor  annuity,
     as  defined in Section  18.06(A).  As of the  annuity  starting  date,  the
     Gateway Participant may elect to receive a smaller annuity benefit,  having
     an actuarial value equivalent to the actuarial value of the qualified joint
     and survivor annuity, with continuation of payments to the beneficiary at a
     rate of 100% of the rate  payable  to the  Gateway  Participant  during his
     lifetime;

          (f) fixed period annuities for any period of whole months which is not
     less  than 60 and  does  not  exceed  the life  expectancy  of the  Gateway
     Participant  and  named  beneficiary  where  the  life  expectancy  is  not
     recalculated;

          (g)  a  series  of  installments   chosen  by  the  Participant.   The
     Participant  may choose at any time to have the balance of his account paid
     in a different form permitted under this Section 18.03.

     If the Gateway  Participant's Accrued Benefit is distributed in the form of
an annuity purchased from an insurance company,  distributions  thereunder shall
be made in  accordance  with the  requirements  of Code ss.  401  (a)(9) and the
regulations   thereunder.    Any   annuity   contract   distributed   shall   be
nontransferable.

     A series of installment  payments shall not be available as a death benefit
if  the  Gateway  Beneficiary  is  riot  the  spouse  of  the  deceased  Gateway
Participant.

     The distribution  options  permitted under this Section 18.03 are available
only if the present  value of the Gateway  Participant's  entire  Nonforfeitable
Accrued  Benefit under the Plan, at the time of the  distribution to the Gateway
Participant, exceeds $5,000.

     The provisions of Section  6.02(A) shall apply in  determining  the minimum
distribution requirements under Code ss. 401(a)(9) for Gateway Participants, and
the  provisions  of Section  6.02(B)  shall  apply in  determining  the  minimum
distribution requirements under Code ss. 401 (a)(9) for Gateway Beneficiaries.

     18.04 TIME OF PAYMENT  AND  ACCRUED  BENEFIT.  Unless,  pursuant to Section
18.05, the Gateway  Participant or the Gateway  Beneficiary  elects in writing a
different  time or method of payment,  the  Advisory  Committee  will direct the
Trustee  to  commence  distribution  of a Gateway  Participant's  Nonforfeitable
Accrued  Benefit  derived  from his  Gateway  Accounts in  accordance  with this
Section  18.04.  A  Gateway   Participant  must  consent,  in  writing,  to  any
distribution  required  under this  Section  18.04 if the  present  value of the
Gateway  Participants  Nonforfeitable  Accrued  Benefit,  at  the  time  of  the
distribution  to  the  Gateway  Participant,  exceeds  $5,000  and  the  Gateway
Participant  has not  attained  the  later of Normal  Retirement  Age or age 62.
Furthermore,  the Gateway Participant's spouse also must consent, in writing, to
any distribution for which Section 18.06 requires the spouse's consent.  For all
purposes of Article VI and this Article XVIII, the term "annuity  starting date"
means the first day of the first  period for which the Plan pays an amount as an
annuity or in any other form.  For  purposes of the consent  requirements  under
this  Article  XVIII,   if  the  present  value  of  the  Gateway   Participants
Nonforfeitable Accrued Benefit derived from his Gateway Accounts, at the time of
any distribution, exceeds $5,000, the Advisory Committee must treat that present
value as exceeding  $5,000 for purposes of all subsequent Plan  distributions to
the Gateway Participant.

     (A) SEPARATION FROM SERVICE FOR A REASON OTHER THAN DEATH.

          (1) GATEWAY PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT NOT EXCEEDING
     $5,000.  If the Gateway  Participant's  Separation  from Service is for any
     reason other than death, the Advisory  Committee will direct the Trustee to
     distribute the Gateway Participant's Nonforfeitable Accrued Benefit derived
     from  his  Gateway  Accounts  in a lump  sum as  soon  as  administratively
     practicable  after the first  distribution  valuation  date  following  the
     Gateway  Participant's  Separation from Service, but in no event later than
     the 60th day  following  the close of the Plan  Year in which  the  Gateway
     Participant  attains Normal Retirement Age. If the Gateway  Participant has
     attained  Normal  Retirement  Age  when  he  separates  from  Service,  the
     distribution  under  this  paragraph  will occur no later than the 60th day
     following  the close of the Plan Year in which  the  Gateway  Participant's
     Separation from Service occurs.

          (2)  GATEWAY  PARTICIPANT'S  NONFORFEITABLE  ACCRUED  BENEFIT  EXCEEDS
     $5,000.  If the Gateway  Participant's  Separation  from Service is for any
     reason other than death, the Advisory  Committee will direct the Trustee to
     distribute the Gateway Participant's Nonforfeitable Accrued Benefit derived
     from his Gateway  Accounts in a form and at the time elected by the Gateway
     Participant,  pursuant to Section  18.05.  In the absence of an election by
     the Gateway Participant,  the Advisory Committee will direct the Trustee to
     distribute the Gateway Participant's Nonforfeitable Accrued Benefit derived
     from his  Gateway  Accounts in a lump sum (or,  if  applicable,  the normal
     annuity form of distribution required under Section 19.06), on the 60th day
     following  the close of the Plan Year in which the latest of the  following
     events occurs: (a) the Gateway  Participant  attains Normal Retirement Age;
     (b)  the   Gateway   Participant   attains  age  62;  or  (c)  the  Gateway
     Participant's Separation from Service.

          (3) DISABILITY.  If the Gateway Participant's  Separation from Service
     is because of disability, the Advisory Committee will direct the Trustee to
     pay the Gateway Participant's  Nonforfeitable  Accrued Benefit derived from
     his Gateway  Accounts in lump sum (or, if  applicable,  the normal  annuity
     form  of   distribution   required  under  Section   18.06),   as  soon  as
     administratively  practicable after the first  distribution  valuation date
     following the Gateway Participant's Separation from Service, subject to the
     notice and consent requirements of this Article XVIII and to the applicable
     mandatory commencement dates described in Paragraph (1) or in Paragraph (2)
     of this Section 18.04(A).

     (B) REQUIRED  BEGINNING  DATE.  The  provisions  of Section  6.01(B)  shall
determine a Gateway Participants Required Beginning Date.

     (C) DEATH OF THE GATEWAY  PARTICIPANT.  The Advisory  Committee will direct
the Trustee,  in  accordance  with this Section  18.04(C),  to distribute to the
Gateway  Beneficiary the Gateway  Participant's  Nonforfeitable  Accrued Benefit
derived  from his  Gateway  Accounts  remaining  in the Trust at the time of the
Gateway Participant's death.

          (1) DECEASED GATEWAY PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT DOES
     NOT EXCEED $5,000. The Advisory  Committee,  subject to the requirements of
     Section 18.06,  must direct the Trustee to distribute the deceased  Gateway
     Participant's  Nonforfeitable  Accrued  Benefit  derived  from his  Gateway
     Accounts  in a single  cash sum,  as soon as  administratively  practicable
     after  the  first   distribution   valuation  date  following  the  Gateway
     Participant's  death or, if later, the date on which the Advisory Committee
     receives  notification of or otherwise  confirms the Gateway  Participant's
     death.

          (2) DECEASED  GATEWAY  PARTICIPANT'S  NONFORFEITABLE  ACCRUED  BENEFIT
     EXCEEDS  $5,000.   The  Advisory  Committee  will  direct  the  Trustee  to
     distribute  the  deceased  Gateway  Participant's   Nonforfeitable  Accrued
     Benefit  derived  from  his  Gateway  Accounts  at the time and in the form
     elected  by the  Gateway  Participant  or, if  applicable,  by the  Gateway
     Beneficiary, as permitted under this Article XVIII.

     If the  death  benefit  is  payable  in full to the  Gateway  Participant's
surviving spouse, the surviving spouse, in addition to the distribution  options
provided in this Section 18.04(C),  may elect distribution at any time or in any
form (other than the joint and survivor annuity) this Article XVIII would permit
for a Gateway Participant.

     (D)  ROLLOVERS.  The  provisions of Section 6.08 shall apply to the Gateway
Accounts.

     18.05 BENEFIT PAYMENT ELECTIONS.  Not earlier than 90 days before nor later
than 30 days before the Gateway  Participant's  annuity  starting date, the Plan
Administrator  must  provide a benefit  notice to a Gateway  Participant  who is
eligible to make an election under this Section  18.05.  The benefit notice must
explain  the  optional  forms of benefit  in the Plan,  including  the  material
features and relative  values of those  options,  and the Gateway  Participant's
right to defer  distribution until he attains the later of Normal Retirement Age
or age 62.

     Such  distribution  may commence less than 30 days after the benefit notice
is given, provided that:

          (1) The Plan  Administrator  clearly informs the Participant  that the
     Participant has a right to a period of at least 30 days after receiving the
     notice to consider the  decision of whether or not to elect a  distribution
     (and, if applicable, a particular distribution option), and

          (2) The Participant,  after receiving the notice, affirmatively elects
     a distribution.

     If  a  Gateway   Participant  or  Gateway  Beneficiary  makes  an  election
prescribed by this Section 18.05, the Advisory Committee will direct the Trustee
to distribute the Gateway Participant's  Nonforfeitable  Accrued Benefit derived
from his Gateway  Accounts in accordance with that election.  Any election under
this  Section is subject to the  requirements  of  Section  18.06.  The  Gateway
Participant  or Gateway  Beneficiary  must make an election  under this  Section
18.05 by filing his election form with the Advisory Committee at any time before
the Trustee  otherwise  would  commence to pay a Gateway  Participant's  Accrued
Benefit derived from his Gateway Accounts in accordance with the requirements of
Articles VI and XVIII.

     (A) GATEWAY PARTICIPANT ELECTIONS AFTER SEPARATION FROM SERVICE.

     If the  present  value of a Gateway  Participant's  Nonforfeitable  Accrued
Benefit exceeds $5,000,  he may elect to have the Trustee commence  distribution
as soon as  administratively  practicable after any distribution  valuation date
following  the  Gateway  Participant's  Separation  from  Service.  The  Gateway
Participant may reconsider an election at any time prior to the annuity starting
date and elect to commence  distribution as of any other  distribution date, but
not earlier than the date described in the first sentence of this Paragraph (A).
Following his attainment of Normal Retirement Age, a Gateway Participant who has
separated  from  Service may elect  distribution  as of any  distribution  date,
irrespective  of  the  restrictions  otherwise  applicable  under  this  Section
18.05(A).

     (B) GATEWAY PARTICIPANT ELECTIONS PRIOR TO SEPARATION FROM SERVICE.

     In addition to the distribution options provided in Section 6.03, a Gateway
Participant,  until he retires,  has a continuing election to receive all or any
portion of his Gateway  Deferral  Contributions  Account if: (a) he has attained
age 59 1/2 and (b) he is 100% vested in the Account. The procedures set forth in
Section 6.03(B) shall apply.  Any distribution is subject to the requirements of
Section 19.06.

     (C) DEATH BENEFIT ELECTIONS.

     If the present value of the deceased Gateway  Participant's  Nonforfeitable
Accrued Benefit exceeds  $5,000,  the Gateway  Beneficiary may elect to have the
Trustee  distribute the Gateway  Participant's  Nonforfeitable  Accrued  Benefit
derived from his Gateway  Accounts in a form and within a period permitted under
Section 18.04. The Gateway Beneficiary's election is subject to any restrictions
designated in writing by the Gateway  Participant and not revoked as of his date
of death.

     (D) TRANSITIONAL ELECTIONS.

     Notwithstanding  the provisions of Section 18.03 and 18.04,  if the Gateway
Participant (or Gateway Beneficiary) signed a written  distribution  designation
prior to January 1, 1984,  the Advisory  Committee  must  distribute the Gateway
Participant's   Nonforfeitable   Accrued   Benefit  in   accordance   with  that
designation,  subject however, to the survivor requirements,  if applicable,  of
Sections  18.06,  18.07 and 18.08.  This  Section  18.05(D)  does not apply to a
pre-1984  distribution  designation,  and the Advisory Committee will not comply
with  that  designation,  if any of the  following  applies:  (1) the  method of
distribution  would have  disqualified  the Plan under Code  ss.401(a)(9)  as in
effect on December 31, 1983; (2) the Gateway Participant did not have an Accrued
Benefit as of December  31,  1983;  (3) the  distribution  designation  does not
specify the timing and form of the distribution and the death  Beneficiaries (in
order of priority);  (4) the substitution of a Gateway Beneficiary  modifies the
payment period of the distribution;  or (5) the Gateway  Participant (or Gateway
Beneficiary) modifies or revokes the distribution designation. In the event of a
revocation,  the Plan must distribute, no later than December 31 of the calendar
year following the year of revocation,  the amount which the Gateway Participant
would have received under Section 18.04(A) if the  distribution  designation had
not been in effect  or, if the  Gateway  Beneficiary  revokes  the  distribution
designation,  the amount which the Gateway Beneficiary would have received under
Section  18.04(C) if the  distribution  designation had not been in effect.  The
Advisory  Committee will apply this Section  18.05(D) to rollovers and transfers
in accordance with Part J of the Code ss.401(a)(9) Treasury regulations.

     (E) HARDSHIP DISTRIBUTIONS.

     The last four full  paragraphs  of Section  6.03(E) shall apply to permit a
Gateway Participant to receive hardship  distributions from his Gateway Matching
Contributions  Account,  his Gateway  Rollover  Contributions  Account,  and the
elective deferrals credited to his Gateway Deferral  Contributions  Account plus
any earnings on the Gateway  Participant's  elective  deferrals  credited before
January 1, 1989. Any hardship distribution is subject to Section 18.06.

     18.06 ANNUITY  DISTRIBUTIONS TO GATEWAY PARTICIPANTS AND SURVIVING SPOUSES.

     (A) JOINT AND  SURVIVOR  ANNUITY.  The Advisory  Committee  must direct the
Trustee to distribute a Gateway  Participant's  Nonforfeitable  Accrued  Benefit
derived from his Gateway  Accounts in the form of a qualified joint and survivor
annuity, unless the Gateway Participant makes a valid waiver election (described
in Section 18.07) within the 90-day period ending on the annuity  starting date.
If, as of the annuity  starting  date,  the Gateway  Participant  is married,  a
qualified  joint  and  survivor  annuity  is  an  immediate   annuity  which  is
purchasable  with  the  Gateway  Participant's  Nonforfeitable  Accrued  Benefit
derived  from his  Gateway  Account  and which  provides a life  annuity for the
Gateway Participant and a survivor annuity payable for the remaining life of the
Gateway Participant's surviving spouse equal to 50% of the amount of the annuity
payable  during  the life of the  Gateway  Participant.  If,  as of the  annuity
starting date, the Gateway  Participant  is not married,  a qualified  joint and
survivor annuity is an immediate life annuity for the Gateway  Participant which
is purchasable  with the Gateway  Participant's  Nonforfeitable  Accrued Benefit
derived from his Gateway  Accounts.  On or before the annuity starting date, the
Advisory Committee,  without Gateway Participant or spousal consent, must direct
the  Trustee to pay the Gateway  Participant's  Nonforfeitable  Accrued  Benefit
derived from his Gateway  Accounts,  in a lump sum, in lieu of a qualified joint
and  survivor   annuity  in  accordance  with  Section  18.04,  if  the  Gateway
Participant's Nonforfeitable Accrued Benefit is not greater than $5,000.

     (B) PRERETIREMENT  SURVIVOR ANNUITY.  If a married Gateway Participant dies
prior to his  annuity  starting  date the  Advisory  Committee  will  direct the
Trustee to  distribute  a portion of the  Gateway  Participant's  Nonforfeitable
Accrued Benefit derived from his Gateway  Accounts to the Gateway  Participant's
surviving  spouse in the form of a preretirement  survivor  annuity,  unless the
Gateway  Participant has a valid waiver election (as described in Section 18.08)
in effect,  or unless the  Gateway  Participant  and his spouse were not married
throughout the one year period ending on the date of his death. A  preretirement
survivor  annuity is an annuity  which is  purchasable  with 50% of the  Gateway
Participants  Nonforfeitable  Accrued Benefit derived from his Gateway  Accounts
(determined  as of the date of the  Gateway  Participant's  death)  and which is
payable for the life of the Gateway Participant's surviving spouse. The value of
the preretirement survivor annuity is attributable to Employer contributions and
to Employee  contributions  in the same proportion as the Gateway  Participant's
Nonforfeitable Accrued Benefit derived from his Gateway Accounts is attributable
to those contributions.  The portion of the Gateway Participant's Nonforfeitable
Accrued  Benefit  derived  from his  Gateway  Accounts  not  payable  under this
paragraph is payable to the Gateway  Participant's  Beneficiary,  in  accordance
with the other  provisions  of this Article  XVIII.  If the present value of the
preretirement  survivor annuity does not exceed $5,000, the Advisory  Committee,
on or before the annuity  starting date,  must direct the Trustee to make a lump
sum distribution to the Gateway  Participant's  surviving  spouse,  in lieu of a
preretirement survivor annuity.

     (C) SURVIVING SPOUSE  ELECTIONS.  If the present value of the preretirement
survivor annuity exceeds $5,000, the Gateway Participant's  surviving spouse may
elect to have the Trustee commence payment of the preretirement survivor annuity
at any time following the date of the Gateway Participant's death, but not later
than the mandatory  distribution  periods  described in Section  18.04,  and may
elect  any  form  of  payment  described  in  Section  18.03,  in  lieu  of  the
preretirement  survivor annuity.  In the absence of an election by the surviving
spouse,  the  Advisory  Committee  must  direct the  Trustee to  distribute  the
preretirement  survivor  annuity on the first  distribution  date  following the
close of the Plan Year in which the latest of the following  events occurs:  (i)
the Gateway  Participant's  death; (ii) the date the Advisory Committee receives
notification of or otherwise confirms the Gateway Participant's death; (iii) the
date the Gateway  Participant would have attained Normal Retirement Age; or (iv)
the date the Gateway Participant would have attained age 62.

     (D) SPECIAL RULES. If the Gateway  Participant has in effect a valid waiver
election regarding the qualified joint and survivor annuity or the preretirement
survivor annuity,  the Advisory  Committee must direct the Trustee to distribute
the  Gateway  Participant's  Nonforfeitable  Accrued  Benefit  derived  from his
Gateway  Accounts  in  accordance  with  Sections  18.03,  18.04 and 18.05.  For
purposes of applying this Article XVIII, the Advisory  Committee treats a former
spouse as the Gateway Participant's spouse or the surviving spouse to the extent
provided under a qualified  domestic  relations order described in Section 6.07.
The  provisions  of this Article  XVIII apply  separately  to the portion of the
Gateway  Participant's  Nonforfeitable  Accrued Benefit derived from his Gateway
Accounts subject to the qualified domestic relations order and to the portion of
the  Gateway  Participant's  Nonforfeitable  Accrued  Benefit  derived  from his
Gateway Accounts not subject to that order.

     LIMITED  APPLICATION OF SECTION.  The preceding  provisions of this Section
18.06 apply only to (1) a Gateway  Participant  as  respects  whom the Plan is a
direct  or  indirect  transferee  from  a  plan  subject  to the  Code  ss.  417
requirements and the Plan received the transfer after December 31, 1984,  unless
the transfer is an elective  transfer  described in Section 11.05; (2) a Gateway
Participant  or Gateway  Beneficiary  who is  eligible  to and who elects a life
annuity  distribution;  and (3) a Gateway  Participant  whose  benefits  under a
defined benefit plan are offset by benefits  provided under this Plan.  Sections
18.07 and 18.08 only apply to a Gateway  Participant  or Gateway  Beneficiary to
whom the preceding provisions of this Section 18.06 apply.

     18.07 WAIVER  ELECTION - QUALIFIED  JOINT AND SURVIVOR  ANNUITY.  Within 90
days, not later than 30 days, before the Gateway  Participants  annuity starting
date,  the Advisory  Committee  must provide the Gateway  Participant  a written
explanation  of the terms and  conditions  of the  qualified  joint and survivor
annuity, the Gateway Participant's right to make, and the effect of, an election
to waive the joint and  survivor  form of  benefit,  the  rights of the  Gateway
Participant's   spouse   regarding   the  waiver   election,   and  the  Gateway
Participant's  right to  make,  and the  effect  of,  a  revocation  of a waiver
election.  The Plan does not limit the number of times the  Gateway  Participant
may revoke a waiver of the  qualified  joint and survivor  annuity or make a new
waiver during the election period.

     A married Gateway  Participants waiver election is not valid unless (a) the
Gateway  Participant's spouse (to whom the survivor annuity is payable under the
qualified  joint and  survivor  annuity),  after  the  Gateway  Participant  has
received the written explanation  described in this Section 18.07, has consented
in writing to the waiver election,  the spouse's consent acknowledges the effect
of  the  election,  and a  notary  public  as the  Plan  Administrator  (or  his
representative)  witnesses the spouse's consent,  (b) the spouse consents to the
alternate form of payment designated by the Gateway Participant or to any change
in that  designated  form of  payment,  and (c) unless the spouse is the Gateway
Participant's  sole  primary  Beneficiary,  the spouse  consents  to the Gateway
Participant's   Beneficiary   designation  or  to  any  change  in  the  Gateway
Participant's  Beneficiary designation.  The spouse's consent to a waiver of the
qualified  joint  and  survivor  annuity  is  irrevocable,  unless  the  Gateway
Participant  revokes  the waiver  election.  The  spouse  may  execute a blanket
consent to any form of payment  designation  or to any  Beneficiary  designation
made by the Gateway  Participant,  if the spouse acknowledges the right to limit
that consent to a specific  designation but, in writing,  waives that right. The
consent requirements of this Section 18.07 apply to a former spouse of a Gateway
Participant,  to the extent required under a qualified  domestic relations order
described in Section 6.07.

     The Advisory  Committee  will accept as valid a waiver  election which does
not  satisfy  the  spousal  consent   requirements  if  the  Advisory  Committee
establishes  the  Gateway  Participant  does not  have a  spouse,  the  Advisory
Committee is not able to locate the Gateway  Participant's  spouse,  the Gateway
Participant is legally  separated or has been  abandoned  (within the meaning of
State law) and the  Gateway  Participant  has a court order to that  effect,  or
other  circumstances exist under which the Secretary of the Treasury will excuse
the  consent  requirement.  If  the  Gateway  Participant's  spouse  is  legally
incompetent  to give consent,  the spouse's legal guardian (even if the guardian
is the Gateway Participant) may give consent.

     18.08  WAIVER  ELECTION -  PRERETIREMENT  SURVIVOR  ANNUITY.  The  Advisory
Committee  must  provide a written  explanation  of the  preretirement  survivor
annuity to each married Gateway  Participant,  within the following period which
ends last:  (1) the period  beginning on the first day of the Plan Year in which
the  Gateway  Participant  attains age 32 and ending on the last day of the Plan
Year in which the Gateway  Participant  attains age 34; (2) a reasonable  period
after an Employee becomes a Gateway  Participant;  (3) a reasonable period after
the joint and survivor rules become  applicable to the Gateway  Participant;  or
(4) a reasonable time after a fully subsidized preretirement survivor annuity no
longer satisfies the requirements of a fully  subsidized  benefit.  A reasonable
period  described in clauses (2), (3) and (4) is the period  beginning  one year
before  and  ending  one  year  after  the  applicable  event.  If  the  Gateway
Participant  separates from Service  before  attaining age 35, clauses (1), (2),
(3) and (4) do not apply and the  Advisory  Committee  must  provide the written
explanation  within the  period  beginning  one year  before and ending one year
after the Separation from Service.  The written explanation must describe,  in a
manner  consistent  with Treasury  Regulations,  the terms and conditions of the
preretirement  survivor  annuity  comparable to the explanation of the qualified
joint and survivor annuity required under Section 18.06. The Plan does not limit
the  number  of times  the  Gateway  Participant  may  revoke  a  waiver  of the
preretirement survivor annuity or make a new waiver during the election period.

     A  Gateway  Participants  waiver  election  of the  preretirement  survivor
annuity  is not valid  unless  (a) the  Gateway  Participant  makes  the  waiver
election no later than the first day of the Plan Year in which he attains age 35
and (b) the Gateway  Participant's  spouse (to whom the  preretirement  survivor
annuity is payable)  satisfies  the consent  requirements  described  in Section
18.06,  except the spouse need not consent to the form of benefit payable to the
designated  Gateway  Beneficiary.  The  spouse's  consent  to the  waiver of the
preretirement  survivor annuity is irrevocable,  unless the Gateway  Participant
revokes the waiver  election.  Irrespective of the time of election  requirement
described in clause (a), if the Gateway Participant separates from Service prior
to the first  day of the Plan  Year in which he  attains  age 35,  the  Advisory
Committee  will accept a waiver  election as respects the Gateway  Participant's
Accrued  Benefit  attributable  to his  Service  prior to this  Separation  from
Service.  Furthermore,  if a Gateway  Participant who has separated from Service
makes a valid waiver election,  except for the timing requirement of clause (a),
the Plan  Administrator  will accept that election as valid,  but only until the
first day of the Plan Year in which the  Gateway  Participant  attains age 35. A
waiver  election  described in this paragraph is not valid unless made after the
Gateway  Participant  has  received  the written  explanation  described in this
Section 18.08.

     18.09  COORDINATION WITH SURVIVOR  REQUIREMENTS.  If the joint and survivor
requirements of Article XVIII apply to the Gateway Participant,  neither Section
8.01 nor this Section 18.09 impose any special spousal  consent  requirements on
the Gateway Participant's  Beneficiary  designation.  However, in the absence of
spousal  consent  (as  required  by  Articles  VI  and  XVIII)  to  the  Gateway
Participant's Beneficiary designation:  (1) any waiver of the joint and survivor
annuity or of the  preretirement  survivor  annuity is not valid; and (2) if the
Gateway  Participant  dies  prior to his  annuity  starting  date,  the  Gateway
Participant's  Beneficiary  designation  will apply  only to the  portion of the
death  benefit  which  is  not  payable  as a  preretirement  survivor  annuity.
Regarding clause (2), if the Gateway Participant's surviving spouse is a primary
Beneficiary under the Gateway Participant's Beneficiary designation, the Trustee
will satisfy the spouse's  interest in the Gateway  Participant's  death benefit
first from the portion which is payable as a preretirement survivor annuity.

     IN WITNESS WHEREOF, the Kansas City Southern Industries,  Inc. has executed
this amended and restated  Plan in Kansas City,  Missouri as of this 12th day of
December, 2000, to be effective as of January 1, 2001.

                                     KANSAS CITY SOUTHERN INDUSTRIES. INC.

                                     By: /s/ Eric B. Freestone
                                        ----------------------------------

WITNESS:

/s/ Tony L. Robertson
---------------------------

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