Document:

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                                                                    EXHIBIT 10.2

                              AMENDED AND RESTATED
                             STOCK OPTION AGREEMENT

     Amended and Restated Stock Option Agreement, dated as of June 11, 2001 and
amended and restated on July 25, 2001 (as of June 11, 2001), between Banknorth
Group, Inc., a Maine corporation ("Grantee"), and MetroWest Bank, a
Massachusetts-chartered savings bank ("Issuer").

                              W I T N E S S E T H:

     WHEREAS, Grantee and Issuer have entered into an Amended and Restated
Agreement and Plan of Reorganization of even date herewith (the "Reorganization
Agreement"), pursuant to which the Company will be combined with an existing
national bank subsidiary of Parent in a series of transactions and in connection
therewith each outstanding share of Company Common Stock (except Dissenting
Shares and Treasury Stock) shall be converted into the right to receive the
Consolidation Consideration; and

     WHEREAS, as a condition and an inducement to Grantee to enter into the
Reorganization Agreement, Issuer has agreed to grant Grantee the Option (as
hereinafter defined);

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements set forth herein and in the Reorganization Agreement, the parties
hereto agree as follows:

     1.   (a)  Issuer hereby grants to Grantee an unconditional, irrevocable
option (the "Option") to purchase, subject to the terms hereof, up to an
aggregate of 2,851,756 fully paid and nonassessable shares (the "Option Shares")
of common stock, par value $0.10 per share, of Issuer (the "Common Stock") at a
price per share equal to $8.76 (the "Option Price"); provided, however, that in
no event shall the number of shares for which this Option is exercisable exceed
19.9% of the issued and outstanding shares of Common Stock. The number of shares
of Common Stock that may be received upon the exercise of the Option and the
Option Price are subject to adjustment as herein set forth.

          (b)  In the event that any additional shares of Common Stock are
either (i) issued or otherwise become outstanding after the date of this
Agreement (other than pursuant to this Agreement and other than pursuant to an
event described in Section 5 hereof), including, without limitation, pursuant to
stock option or other employee plans or as a result of the exercise of
conversion rights, or (ii) redeemed, repurchased, retired or otherwise cease to
be outstanding after the date of this Agreement, the number of shares of Common
Stock subject to the Option shall be increased or decreased, as appropriate, so
that, after such event, such number equals 19.9% of the number of shares of
Common Stock then issued and outstanding without giving effect to any shares
subject to or issued pursuant to the Option. Nothing contained in this Section
l(b) or elsewhere in

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this Agreement shall be deemed to authorize Issuer or Grantee to breach any
provision of the Reorganization Agreement.

     2.   (a)  The Holder (as hereinafter defined) may exercise the Option, in
whole or part, and from time to time, if, but only if, both an Initial
Triggering Event (as hereinafter defined) and a Subsequent Triggering Event (as
hereinafter defined) shall have occurred prior to the occurrence of an Exercise
Termination Event (as hereinafter defined), provided that the Holder shall have
sent the Exercise Notice (as hereinafter defined) within ninety (90) days
following such Subsequent Triggering Event (or such later period as provided in
Section 10). Each of the following shall be an Exercise Termination Event: (i)
the Effective Time (as defined in the Reorganization Agreement); (ii)
termination of the Reorganization Agreement in accordance with the provisions
thereof if such termination occurs prior to the occurrence of an Initial
Triggering Event, except a termination by Grantee pursuant to Section 8.01(b) of
the Reorganization Agreement (unless the breach by Issuer giving rise to such
right of termination was non-volitional ( a "Listed Termination")); or (iii) the
passage of 12 months (or such longer period as provided in Section 10) after
termination of the Reorganization Agreement if such termination follows the
occurrence of an Initial Triggering Event or is a Listed Termination, provided
that if an Initial Triggering Event continues or occurs beyond such termination
and prior to the passage of such 12-month-period, the Exercise Termination Event
shall be 12 months from the expiration of the Last Triggering Event but in no
event more than 18 months after such termination. The term "Last Triggering
Event" shall mean the last Initial Triggering Event to be in effect, and the
term "Holder" shall mean the permitted holder or holders of the Option pursuant
to this Agreement. Notwithstanding anything to the contrary contained herein,
the Option may not be exercised at any time when Grantee shall be in willful
material breach of any of its covenants or agreements contained in the
Reorganization Agreement such that Issuer shall be entitled to terminate the
Reorganization Agreement pursuant to Section 8.01(b) thereof as a result of such
a willful material breach.

          (b)  The term "Initial Triggering Event" shall mean any of the
following events or transactions occurring on or after the date hereof:

               (i)  Issuer or any Subsidiary (as hereinafter defined) of Issuer
          (an "Issuer Subsidiary"), without having received Grantee's prior
          written consent, shall have entered into an agreement to engage in an
          Acquisition Transaction (as hereinafter defined) with any person (the
          term "person" for purposes of this Agreement having the meaning
          assigned thereto in Sections 3(a)(9) and 13(d)(3) of the Securities
          Exchange Act of 1934, as amended (the "1934 Act"), and the rules and
          regulations thereunder), other than Grantee or any Subsidiary of
          Grantee (a "Grantee Subsidiary") or the Board of Directors of Issuer
          (the "Issuer Board") shall have recommended that the stockholders of
          Issuer approve or accept any Acquisition Transaction with any person
          other than Grantee or a Grantee Subsidiary. For purposes of this
          Agreement, (a) "Acquisition Transaction" shall mean (w) a merger or
          consolidation, or any similar transaction, involving Issuer or any
          Issuer Subsidiary, (x) a purchase, lease or other acquisition or
          assumption of all or any substantial part of the consolidated assets
          or consolidated deposits of Issuer or any

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          Issuer Subsidiary, (y) a purchase or other acquisition (including by
          way of merger, consolidation, share exchange or otherwise) of
          securities representing 10% or more of the voting power of Issuer or
          any Issuer Subsidiary or (z) any substantially similar transaction,
          provided that in no event shall (i) any merger, consolidation,
          purchase or similar transaction involving only Issuer and one or more
          of its Subsidiaries, or involving only any two or more of such
          Subsidiaries, be deemed to be an Acquisition Transaction, provided
          that any such transaction is not entered into in violation of the
          terms of the Reorganization Agreement, or (ii) the transactions
          contemplated by the Reorganization Agreement or the entering into of
          the Reorganization Agreement be deemed to be an Acquisition
          Transaction; and (b) "Subsidiary" shall have the meaning set forth in
          Rule 12b-2 under the 1934 Act;

               (ii)  After the date hereof, any person, other than Grantee or a
          Grantee Subsidiary, shall have acquired beneficial ownership or the
          right to acquire beneficial ownership of 10% or more of the
          outstanding shares of Common Stock (the term "beneficial ownership"
          for purposes of this Agreement having the meaning assigned thereto in
          Section 13(d) of the 1934 Act, and the rules and regulations
          thereunder);

               (iii) The stockholders of Issuer shall have voted and failed to
          approve the Reorganization Agreement at a meeting which has been held
          for that purpose or any adjournment or postponement thereof, or such
          meeting shall not have been held in violation of the Reorganization
          Agreement or shall have been cancelled prior to termination of the
          Reorganization Agreement if, in each case prior to such meeting (or if
          such meeting shall not have been held or shall have been cancelled,
          prior to such termination), it shall have been publicly announced that
          any person (other than Grantee or a Grantee Subsidiary) shall have
          made, or publicly disclosed an intention to make, a proposal to engage
          in an Acquisition Transaction;

               (iv) The Issuer Board, without having received Grantee's prior
          written consent, shall have withdrawn or modified, or publicly
          announced its intention to withdraw or modify in any manner adverse in
          any respect to Grantee, its recommendation that the stockholders of
          Issuer approve the transactions contemplated by the Reorganization
          Agreement in anticipation of engaging in an Acquisition Transaction,
          or Issuer or any Issuer Subsidiary shall have authorized, recommended
          or proposed, or publicly announced its intention to authorize,
          recommend or propose, an agreement to engage in an Acquisition
          Transaction with any person other than Grantee or a Grantee
          Subsidiary;

               (v)  Any person other than Grantee or a Grantee Subsidiary shall
          have filed with the Securities and Exchange Commission ("SEC") a
          registration statement or tender offer materials with respect to a
          potential exchange offer or tender offer that would constitute an
          Acquisition Transaction (or filed a preliminary proxy statement

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          with the SEC with respect to a potential vote by its stockholders to
          approve the issuance of shares to be offered in such an exchange
          offer);

               (vi)  Issuer shall have breached any covenant or obligation
          contained in the Reorganization Agreement after a proposal is made by
          any third party, other than Grantee or a Grantee Subsidiary, to engage
          in an Acquisition Transaction and following such breach (x) Grantee
          would be entitled to terminate the Reorganization Agreement (whether
          immediately or after the giving of notice or passage of time or both)
          and (y) such breach shall not have been cured prior to the Notice Date
          (as defined below); or

               (vii) Any person other than Grantee or a Grantee Subsidiary,
          without Grantee's prior written consent, shall have filed an
          application or notice with the Board of Governors of the Federal
          Reserve System (the "Federal Reserve Board") or other federal or state
          bank regulatory or antitrust authority, which application or notice
          has been accepted for processing, for approval to engage in an
          Acquisition Transaction.

          (c)  The term "Subsequent Triggering Event" shall mean any of the
following events or transactions occurring after the date hereof:

               (i)   The acquisition by any person (other than Grantee or any
          Grantee Subsidiary) of beneficial ownership of 25% or more of the then
          outstanding Common Stock; or

               (ii)  The occurrence of the Initial Triggering Event described in
          clause (i) of subsection (b) of this Section 2, except that the
          percentage referred to in clause (y) of the second sentence thereof
          shall be 25%.

          (d)  Issuer shall notify Grantee promptly in writing of the occurrence
of any Initial Triggering Event or Subsequent Triggering Event (together, a
"Triggering Event") of which it has notice, it being understood that the giving
of such notice by Issuer shall not be a condition to the right of the Holder to
exercise the Option.

          (e)  In the event the Holder is entitled to and wishes to exercise the
Option (or any portion thereof), it shall send to Issuer a written notice (an
"Exercise Notice," the date of which being herein referred to as the "Notice
Date") specifying (i) the total number of shares of Common Stock it will
purchase pursuant to such exercise and (ii) a place and date not earlier than
three business days nor later than 60 business days from the Notice Date for the
closing of such purchase (the "Closing," the date of which being herein referred
to as the "Closing Date"); provided that if prior notification to or approval of
the Federal Reserve Board or any other regulatory or antitrust agency is
required in connection with such purchase, the Holder shall promptly file the
required notice or application for approval, shall promptly notify Issuer of
such filing and shall expeditiously process the same and the

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period of time that otherwise would run pursuant to this sentence shall run
instead from the date on which any required notification periods have expired or
been terminated or such approvals have been obtained and any requisite waiting
period or periods shall have passed. Any exercise of the Option shall be deemed
to occur on the Notice Date relating thereto. The term "business day" for
purposes of this Agreement means any day, excluding Saturdays, Sundays and any
other day that is a legal holiday in the Commonwealth of Massachusetts or a day
on which banking institutions in the Commonwealth of Massachusetts are
authorized by law or executive order to close.

          (f)  At a Closing, the Holder shall (i) pay to Issuer the aggregate
purchase price for the Option Shares purchased pursuant to the exercise of the
Option in immediately available funds by wire transfer to a bank account
designated by Issuer and (ii) present and surrender this Agreement to Issuer at
its principal executive offices, provided that the failure or refusal of the
Issuer to designate such a bank account or accept surrender of this Agreement
shall not preclude the Holder from exercising the Option.

          (g)  At a Closing, simultaneously with the delivery of immediately
available funds as provided in subsection (f) of this Section 2, Issuer shall
deliver to the Holder a certificate or certificates representing the number of
Option Shares purchased by the Holder and, if the Option should be exercised in
part only, a new Option evidencing the rights of the Holder thereof to purchase
the balance of the Option Shares purchasable hereunder, and the Holder shall
deliver to Issuer a copy of this Agreement and a letter agreeing that the Holder
will not offer to sell or otherwise dispose of such shares in violation of
applicable law or the provisions of this Agreement.

          (h)  Certificates for Option Shares delivered at a Closing hereunder
may be endorsed (in the sole discretion of Issuer) with a restrictive legend
that shall read substantially as follows:

          "The transfer of the shares represented by this certificate is subject
     to certain provisions of an agreement between the registered holder hereof
     and Issuer and to resale restrictions arising under the Securities Act of
     1933, as amended. A copy of such agreement is on file at the principal
     office of Issuer and will be provided to the holder hereof without charge
     upon receipt by Issuer of a written request therefor."

It is understood and agreed that: (i) the reference to the resale restrictions
of the Securities Act of 1933, as amended (the "1933 Act") in the above legend
shall be removed by delivery of substitute certificate(s) without such reference
if the Holder shall have delivered to Issuer a copy of a letter from the staff
of the SEC, or an opinion of counsel, in form and substance reasonably
satisfactory to Issuer, to the effect that such legend is not required for
purposes of the 1933 Act; (ii) the reference to the provisions of this Agreement
in the above legend shall be removed by delivery of substitute certificate(s)
without such reference if the shares have been sold or transferred in compliance
with the provisions of this Agreement and under circumstances that do not
require the retention of such reference in the opinion of counsel to the Holder,
which shall be set forth in a written opinion in form and substance reasonably
satisfactory to Issuer; and (iii) the legend shall be removed in its entirety if
the conditions in the preceding clauses (i) and (ii) are both satisfied. In
addition, such certificates shall bear any other legend as may be required by
law.

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          (i)  Upon the giving by the Holder to Issuer of the written notice of
exercise of the Option provided for under paragraph (e) of this Section 2, the
tender of the applicable purchase price in immediately available funds and the
tender of a copy of this Agreement to Issuer, the Holder shall be deemed,
subject to the receipt of any necessary regulatory approvals, to be the holder
of record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of Issuer shall then be closed or
that certificates representing such shares of Common Stock shall not then be
actually delivered to the Holder. Issuer shall pay all expenses, and any and all
United States federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of stock
certificates under this Section 2 in the name of the Holder or its assignee,
transferee or designee.

     3.   Issuer agrees: (i) that it shall at all times maintain, free from
preemptive rights, sufficient authorized but unissued or treasury shares of
Common Stock so that the Option may be exercised without additional
authorization of Common Stock after giving effect to all other options,
warrants, convertible securities and other rights to purchase Common Stock; (ii)
that it will not, by charter amendment or through reorganization, consolidation,
merger, dissolution or sale of assets, or by any other voluntary act, avoid or
seek to avoid the observance or performance of any of the covenants,
stipulations or conditions to be observed or performed hereunder by Issuer;
(iii) promptly to take all action as may from time to time be required
(including without limitation (x) complying with all applicable premerger
notification, reporting and waiting period requirements specified in 15 U.S.C.
Section 18a and regulations promulgated thereunder and (y) in the event, under
the Bank Holding Company Act of 1956, as amended (the "BHCA"), or the Change in
Bank Control Act of 1978, as amended, or any state or other federal banking law,
prior approval of or notice to the Federal Reserve Board or to any state or
other federal regulatory authority is necessary before the Option may be
exercised, cooperating fully with the Holder in connection with the preparation
of such applications or notices and providing such information to the Federal
Reserve Board or such state or other federal regulatory authority as they may
require) in order to permit the Holder to exercise the Option and Issuer duly
and effectively to issue shares of Common Stock pursuant hereto; and (iv)
promptly to take all action provided herein to protect the rights of the Holder
against dilution.

     4.   This Agreement and the Option granted hereby are exchangeable, without
expense, at the option of the Holder, upon presentation and surrender of this
Agreement at the principal office of Issuer, for other Agreements providing for
Options of different denominations entitling the holder thereof to purchase on
the same terms and subject to the same conditions as are set forth herein in the
aggregate the same number of shares of Common Stock purchasable hereunder. The
terms "Agreement" and "Option" as used herein include any Stock Option
Agreements and related Options for which this Agreement (and the Option granted
hereby) may be exchanged. Upon receipt by Issuer of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a new Agreement of like
tenor and date. Any such new Agreement executed and delivered shall constitute
an additional contractual obligation on the part of Issuer, subject to the
aforementioned

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indemnification, if applicable, whether or not the Agreement so lost, stolen,
destroyed or mutilated shall at any time be enforceable by anyone.

     5.   In addition to the adjustment in the number of shares of Common Stock
that are purchasable upon exercise of the Option pursuant to Section 1 of this
Agreement, the number of Option Shares purchasable upon the exercise of the
Option and the Option Price shall be subject to adjustment from time to time as
provided in this Section 5. In the event of any change in, or distributions in
respect of, the Common Stock by reason of stock dividend, stock split, split-up,
merger, recapitalization, stock combination, subdivision, conversion, exchange
of shares, distribution on or in respect of the Common Stock or similar
transaction, the type and number of Option Shares subject to the Option, and the
Option Price therefor, shall be adjusted appropriately, and proper provision
shall be made in the agreements governing such transaction, so that Grantee
shall receive upon exercise of the Option the number and class of Option Shares
or other securities or property that Grantee would have received in respect of
Option Shares if the Option had been exercised immediately prior to such event,
or the record date therefor, as applicable.

     6.   Upon the occurrence of a Subsequent Triggering Event that occurs prior
to an Exercise Termination Event, Issuer shall, at the request of Grantee
delivered within six (6) months (or such later period as provided in Section 10)
following such Subsequent Triggering Event (whether on its own behalf or on
behalf of any subsequent holder of this Option (or part thereof) or any of the
Option Shares issued pursuant hereto), promptly prepare, file and keep current,
with respect to the Option and the Option Shares, a registration statement under
the 1933 Act, to the extent applicable, and/or any applicable securities
offering rules of a federal or state banking authority, and qualify such Option
and Option Shares for resale or other disposition under applicable state
securities laws, in each case in accordance with any plan of disposition
requested by Grantee. Issuer will use all reasonable efforts to cause such
registration statement promptly to become effective and then to remain effective
for such period not in excess of 180 days from the day such registration
statement first becomes effective or such shorter time as may be reasonably
necessary to effect such sales or other dispositions. Grantee shall have the
right to demand two such registrations. Issuer shall bear the costs of such
registrations (including, but not limited to, Issuer's attorneys' fees, printing
costs and filing fees, except for underwriting discounts or commissions,
brokers' fees and the fees and disbursements of Grantee's counsel related
thereto). The foregoing notwithstanding, if, at the time of any request by
Grantee for registration of the Option or Option Shares as provided above,
Issuer is in registration with respect to an underwritten public offering by
Issuer of shares of Common Stock, and if in the good faith judgment of the
managing underwriter or managing underwriters, or, if none, the sole underwriter
or underwriters, of such offering, the inclusion of the Option and/or Option
Shares would interfere with the successful marketing of the shares of Common
Stock offered by Issuer, the number of shares represented by the Option and/or
the number of Option Shares otherwise to be covered in the registration
statement contemplated hereby may be reduced; provided, however, that after any
such required reduction the number of shares represented by the Option and/or
the number of Option Shares to be included in such offering for the account of
the Holder shall constitute at least 25% of the total number of shares to be
sold by the Holder and Issuer in the aggregate; and provided further, however,
that if such reduction occurs, then Issuer shall file a registration statement
for the balance as promptly as practicable thereafter as to which no reduction

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pursuant to this Section 6 shall be permitted or occur and Holder shall
thereafter be entitled to one additional registration and the twelve (12) month
period referred to in the first sentence of this section shall be increased to
twenty four (24) months. Each such Holder shall provide all information
reasonably requested by Issuer for inclusion in any such registration statement
to be filed hereunder. If requested by any such Holder in connection with such
registration, Issuer shall become a party to any underwriting agreement relating
to the sale of such shares, but only to the extent of obligating itself in
respect of representations, warranties, indemnities and other agreements
customarily included in such underwriting agreements for Issuer. Upon receiving
any request under this Section 6 from any Holder, Issuer agrees to send a copy
thereof to any other person known to Issuer to be entitled to registration
rights under this Section 6, in each case by promptly mailing the same, postage
prepaid, to the address of record of the persons entitled to receive such
copies. Notwithstanding anything to the contrary contained herein, in no event
shall the number of registrations that Issuer is obligated to effect be
increased by reason of the fact that there shall be more than one Holder as a
result of any assignment or division of this Agreement.

     7.   (a)  Immediately prior to the occurrence of a Repurchase Event (as
described below), (i) at the request of any Holder delivered prior to an
Exercise Termination Event (or such later period as provided in Section 10),
Issuer (or any successor thereto) shall repurchase the Option from the Holder at
a price (the "Option Repurchase Price") equal to the amount by which (A) the
Market/Offer Price (as defined below) exceeds (B) the Option Price, multiplied
by the number of shares for which the Option may then be exercised, and (ii) at
the request of the owner of Option Shares from time to time (the "Owner"),
delivered within 90 days following such occurrence (or such later period as
provided in Section 10), Issuer (or any successor thereto) shall repurchase such
number of the Option Shares from the Owner as the Owner shall designate at a
price (the "Option Share Repurchase Price") equal to the greater of (A) the
Market/Offer Price and (B) the average exercise price per share paid by the
Owner for the Option Shares so designated. The term "Market/Offer Price" shall
mean the highest of (i) the price per share of Common Stock at which a tender
offer or exchange offer therefor has been made, (ii) the price per share of
Common Stock to be paid by any person, other than Grantee or a Grantee
Subsidiary, pursuant to an agreement with Issuer of the kind described in
Section 2(b)(i), (iii) the highest closing price for shares of Common Stock
within the six-month period immediately preceding the date of such required
repurchase of the Option or Option Shares, as the case may be, or (iv) in the
event of a sale of all or any substantial part of Issuer's assets or deposits,
the sum of the price paid in such sale for such consolidated assets or
consolidated deposits and the current market value of the remaining assets of
Issuer as determined by a nationally-recognized investment banking firm selected
by a majority in interest of the Holders or the Owners, as the case may be, and
reasonably acceptable to Issuer, divided by the number of shares of Common Stock
of Issuer outstanding at the time of such sale. In determining the Market/Offer
Price, the value of consideration other than cash shall be determined by a
nationally-recognized investment banking firm selected by the Holder or Owner,
as the case may be, and reasonably acceptable to Issuer.

          (b)  Each Holder and Owner, as the case may be, may exercise its right
to require Issuer to repurchase the Option and any Option Shares pursuant to
this Section 7 by surrendering for such purpose to Issuer, at its principal
office, a copy of this Agreement or certificates for Option

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Shares, as applicable, accompanied by a written notice or notices stating that
such Holder or Owner, as the case may be, elects to require Issuer to repurchase
this Option and/or Option Shares in accordance with the provisions of this
Section 7. As promptly as practicable, and in any event within five business
days after the surrender of the Option and/or certificates representing Option
Shares and the receipt of such notice or notices relating thereto, Issuer shall
deliver or cause to be delivered to the Holder the Option Repurchase Price
and/or to the Owner the Option Share Repurchase Price therefor or the portion
thereof that Issuer is not then prohibited under applicable law and regulation
from so delivering.

          (c)  To the extent that Issuer is prohibited under applicable law or
regulation, or as a consequence of administrative policy, or as a result of a
written agreement or other binding obligation with a governmental or regulatory
body or agency, from repurchasing the Option and/or the Option Shares in full,
Issuer shall immediately so notify each Holder and/or each Owner and thereafter
deliver or cause to be delivered, from time to time, to such Holder and/or such
Owner, as appropriate, the portion of the Option Repurchase Price and the Option
Share Repurchase Price, respectively, that it is no longer prohibited from
delivering, within two business days after the date on which Issuer is no longer
so prohibited; provided, however, that if Issuer at any time after delivery of a
notice of repurchase pursuant to paragraph (b) of this Section 7 is prohibited
under applicable law or regulation, or as a consequence of administrative
policy, or as a result of a written agreement or other binding obligation with a
governmental or regulatory body or agency, from delivering to the Holder and/or
the Owner, as appropriate, the Option Repurchase Price and the Option Share
Repurchase Price, respectively, in part or in full (and Issuer hereby undertakes
to use all reasonable efforts to obtain all required regulatory and legal
approvals and to file any required notices as promptly as practicable in order
to accomplish such repurchase), such Holder or Owner may revoke its notice of
repurchase of the Option and/or the Option Shares either in whole or to the
extent of the prohibition, whereupon, in the latter case, Issuer shall promptly
(i) deliver to the Holder and/or the Owner, as appropriate, that portion of the
Option Repurchase Price and/or the Option Share Repurchase Price that Issuer is
not prohibited from delivering with respect to Options or Option Shares as to
which the Holder or the Owner, as the case may be, has not revoked its
repurchase demand; and (ii) deliver, as appropriate, either (A) to the Holder, a
new Agreement evidencing the right of the Holder to purchase that number of
shares of Common Stock obtained by multiplying the number of shares of Common
Stock for which the surrendered Agreement was exercisable at the time of
delivery of the notice of repurchase by a fraction, the numerator of which is
the Option Repurchase Price less the portion thereof theretofore delivered to
the Holder and the denominator of which is the Option Repurchase Price, and/or
(B) to such Owner, a certificate for the Option Shares it is then so prohibited
from repurchasing.

          (d)  For purposes of this Agreement, a "Repurchase Event" shall be
deemed to have occurred upon the occurrence of any of the following events or
transactions after the date hereof:

               (i)  the acquisition by any person (other than Grantee or any
     Grantee Subsidiary) of beneficial ownership of 50% or more of the then
     outstanding Common Stock; or

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               (ii)  the consummation of any Acquisition Transaction described
     in Section 2(b)(i) hereof, except that the percentage referred to in clause
     (y) of the second sentence thereof shall be 50%;

provided that no such event shall constitute a Repurchase Event unless a
Subsequent Triggering Event shall have occurred prior to an Exercise Termination
Event. The parties hereto agree that Issuer's obligations to repurchase the
Option or Option Shares under this Section 7 shall not terminate upon the
occurrence of any Exercise Termination Event unless no Subsequent Triggering
Event shall have occurred prior to the occurrence of an Exercise Termination
Event.

     8.   (a)  In the event that prior to an Exercise Termination Event, Issuer
shall enter into an agreement (i) to consolidate with or merge into any person,
other than Grantee or a Grantee Subsidiary, or engage in a plan of exchange with
any person, other than Grantee or a Grantee Subsidiary, and Issuer shall not be
the continuing or surviving corporation of such consolidation or merger or the
acquiror in such plan of exchange, (ii) to permit any person, other than Grantee
or a Grantee Subsidiary, to merge into Issuer or be acquired by Issuer in a plan
of exchange and Issuer shall be the continuing or surviving or acquiring
corporation, but, in connection with such merger or plan of exchange, the then
outstanding shares of Common Stock shall be changed into or exchanged for stock
or other securities of any other person or cash or any other property or the
then outstanding shares of Common Stock shall after such merger or plan of
exchange represent less than 50% of the outstanding shares and share equivalents
of the merged or acquiring company, or (iii) to sell or otherwise transfer all
or a substantial part of its or any Issuer Subsidiary's consolidated assets or
consolidated deposits to any person, other than Grantee or a Grantee Subsidiary,
then, and in each such case, the agreement governing such transaction shall make
proper provision so that the Option shall, upon the consummation of any such
transaction and upon the terms and conditions set forth herein, be converted
into, or exchanged for, an option (the "Substitute Option"), at the election of
any Holder, of either (x) the Acquiring Corporation (as hereinafter defined) or
(y) any person that controls the Acquiring Corporation.

          (b)  The following terms have the meanings indicated:

               (i)   "Acquiring Corporation" shall mean (i) the continuing or
     surviving person of a consolidation or merger with Issuer (if other than
     Issuer), (ii) the acquiring person in a plan of exchange in which Issuer is
     acquired, (iii) Issuer in a merger or plan of exchange in which Issuer is
     the continuing or surviving or acquiring person, and (iv) the transferee of
     all or a substantial part of Issuer's consolidated assets or consolidated
     deposits (or the assets or deposits of an Issuer Subsidiary).

               (ii)  "Substitute Common Stock" shall mean the common stock
     issued by the issuer of the Substitute Option upon exercise of the
     Substitute Option.

               (iii) "Assigned Value" shall mean the Market/Offer Price, as
     defined in Section 7.

                                       10
<PAGE>   11

               (iv) "Average Price" shall mean the average closing price of a
     share of the Substitute Common Stock for the one year immediately preceding
     the consolidation, merger, share exchange or sale in question, but in no
     event higher than the closing price of the shares of Substitute Common
     Stock on the day preceding such consolidation, merger, share exchange or
     sale; provided that if Issuer is the issuer of the Substitute Option, the
     Average Price shall be computed with respect to a share of common stock
     issued by the person merging into Issuer or by any company which controls
     or is controlled by such person, as the Holder may elect.

          (c)  The Substitute Option shall have the same terms as the Option,
provided that if the terms of the Substitute Option cannot, for legal reasons,
be the same as the Option, such terms shall, to the extent legally permissible,
be as similar as possible to, and in no event less advantageous to the Holder
than, the terms of the Option. The issuer of the Substitute Option also shall
enter into an agreement with the then Holder or Holders of the Substitute Option
in substantially the same form as this Agreement (after giving effect for such
purpose to the provisions of Section 9), which agreement shall be applicable to
the Substitute Option.

          (d)  The Substitute Option shall be exercisable for such number of
shares of Substitute Common Stock as is equal to the Assigned Value multiplied
by the number of shares of Common Stock for which the Option was exercisable
immediately prior to the event described in the first sentence of Section 8(a),
divided by the Average Price. The exercise price of the Substitute Option per
share of Substitute Common Stock shall then be equal to the Option Price
multiplied by a fraction, the numerator of which shall be the number of shares
of Common Stock for which the Option was exercisable immediately prior to the
event described in the first sentence of Section 8(a) and the denominator of
which shall be the number of shares of Substitute Common Stock for which the
Substitute Option is exercisable.

          (e)  In no event, pursuant to any of the foregoing paragraphs, shall
the Substitute Option be exercisable for more than 19.9% of the shares of
Substitute Common Stock outstanding prior to exercise of the Substitute Option.
In the event that the Substitute Option would be exercisable for more than 19.9%
of the shares of Substitute Common Stock outstanding prior to exercise but for
this paragraph (e), the issuer of the Substitute Option (the "Substitute Option
Issuer") shall make a cash payment to Holder equal to the excess of (i) the
value of the Substitute Option without giving effect to the limitation in this
paragraph (e) over (ii) the value of the Substitute Option after giving effect
to the limitation in this paragraph (e). This difference in value shall be
determined by a nationally-recognized investment banking firm selected by a
majority in interest of the Holders and reasonably acceptable to the Acquiring
Corporation.

          (f)  Issuer shall not enter into any transaction described in
paragraph (a) of this Section 8 unless the Acquiring Corporation and any person
that controls the Acquiring Corporation assume in writing all the obligations of
Issuer hereunder.

                                       11
<PAGE>   12

     9.   (a)  At the request of the holder of the Substitute Option (the
"Substitute Option Holder") delivered to the Substitute Option Issuer, the
Substitute Option Issuer shall repurchase the Substitute Option from the
Substitute Option Holder at a price (the "Substitute Option Repurchase Price")
equal to the amount by which (i) the Highest Closing Price (as hereinafter
defined) exceeds (ii) the exercise price of the Substitute Option, multiplied by
the number of shares of Substitute Common Stock for which the Substitute Option
may then be exercised, and at the request of each owner (the "Substitute Share
Owner") of shares of Substitute Common Stock (the "Substitute Shares"), the
Substitute Option Issuer shall repurchase the Substitute Shares at a price (the
"Substitute Share Repurchase Price") equal to the greater of (A) the Highest
Closing Price and (B) the average exercise price per share paid by the
Substitute Share Owner for the Substitute Shares so designated, multiplied by
the number of Substitute Shares so designated. The term "Highest Closing Price"
shall mean the highest closing price for shares of Substitute Common Stock
within the six-month period immediately preceding the date the Substitute Option
Holder gives notice of the required repurchase of the Substitute Option or the
Substitute Share Owner gives notice of the required repurchase of the Substitute
Shares, as applicable.

          (b)  Each Substitute Option Holder and Substitute Share Owner, as the
case may be, may exercise its respective right to require the Substitute Option
Issuer to repurchase the Substitute Option and the Substitute Shares pursuant to
this Section 9 by surrendering for such purpose to the Substitute Option Issuer,
at its principal office, the agreement for such Substitute Option (or, in the
absence of such an agreement, a copy of this Agreement) and/or certificates for
Substitute Shares accompanied by a written notice or notices stating that the
Substitute Option Holder or the Substitute Share Owner, as the case may be,
elects to require the Substitute Option Issuer to repurchase the Substitute
Option and/or the Substitute Shares in accordance with the provisions of this
Section 9. As promptly as practicable, and in any event within two business days
after the surrender of the Substitute Option and/or certificates representing
Substitute Shares and the receipt of such notice or notices relating thereto,
the Substitute Option Issuer shall deliver or cause to be delivered to the
Substitute Option Holder the Substitute Option Repurchase Price and/or to the
Substitute Share Owner the Substitute Share Repurchase Price therefor, or the
portion(s) thereof which the Substitute Option Issuer is not then prohibited
under applicable law and regulation from so delivering.

          (c)  To the extent that the Substitute Option Issuer is prohibited
under applicable law or regulation, or as a consequence of administrative
policy, or as a result of a written agreement or other binding obligation with a
governmental or regulatory body or agency, from repurchasing the Substitute
Option and/or the Substitute Shares in part or in full, the Substitute Option
Issuer following a request for repurchase pursuant to this Section 9 shall
immediately so notify the Substitute Option Holder and/or the Substitute Share
Owner and thereafter deliver or cause to be delivered, from time to time, to the
Substitute Option Holder and/or the Substitute Share Owner, as appropriate, the
portion of the Substitute Option Repurchase Price and/or the Substitute Share
Repurchase Price, respectively, which it is no longer prohibited from
delivering, within two business days after the date on which the Substitute
Option Issuer is no longer so prohibited; provided, however, that if the
Substitute Option Issuer is at any time after delivery of a notice of repurchase
pursuant to subsection (b) of this Section 9 prohibited under applicable law or
regulation, or as a

                                       12
<PAGE>   13

consequence of administrative policy, or as a result of a written agreement or
other binding obligation with a governmental or regulatory body or agency, from
delivering to the Substitute Option Holder and/or the Substitute Share Owner, as
appropriate, the Substitute Option Repurchase Price and the Substitute Share
Repurchase Price, respectively, in full (and the Substitute Option Issuer shall
use all reasonable efforts to obtain all required regulatory and legal approvals
as promptly as practicable in order to accomplish such repurchase), the
Substitute Option Holder and/or Substitute Share Owner may revoke its notice of
repurchase of the Substitute Option or the Substitute Shares either in whole or
to the extent of the prohibition, whereupon, in the latter case, the Substitute
Option Issuer shall promptly (i) deliver to the Substitute Option Holder or
Substitute Share Owner, as appropriate, that portion of the Substitute Option
Repurchase Price or the Substitute Share Repurchase Price that the Substitute
Option Issuer is not prohibited from delivering; and (ii) deliver, as
appropriate, either (A) to the Substitute Option Holder, a new Substitute Option
evidencing the right of the Substitute Option Holder to purchase that number of
shares of the Substitute Common Stock obtained by multiplying the number of
shares of the Substitute Common Stock for which the surrendered Substitute
Option was exercisable at the time of delivery of the notice of repurchase by a
fraction, the numerator of which is the Substitute Option Repurchase Price less
the portion thereof theretofore delivered to the Substitute Option Holder and
the denominator of which is the Substitute Option Repurchase Price, and/or (B)
to the Substitute Share Owner, a certificate for the Substitute Option Shares it
is then so prohibited from repurchasing.

     10.  The 90-day or six-month periods for exercise of certain rights under
Sections 2, 6, 7 and 9 shall be extended: (i) to the extent necessary to obtain
all regulatory approvals for the exercise of such rights (for so long as the
Holder, Owner, Substitute Option Holder or Substitute Share Owner, as the case
may be, is using its reasonable best efforts to obtain such regulatory
approvals), and for the expiration of all statutory waiting periods; (ii) during
the pendency of any order, injunction or judgment that prohibits or delays
exercise of such rights; and (iii) to the extent necessary to avoid liability
under Section 16(b) of the 1934 Act by reason of such exercise.

     11.  (a)  Issuer hereby represents and warrants to Grantee as follows:

               (i)  Issuer has full corporate power and authority to execute and
     deliver this Agreement and to consummate the transactions contemplated
     hereby. The execution and delivery of this Agreement and the consummation
     of the transactions contemplated hereby have been duly and validly
     authorized by the Issuer Board and no other corporate proceedings on the
     part of Issuer are necessary to authorize this Agreement or to consummate
     the transactions so contemplated. This Agreement has been duly and validly
     executed and delivered by Issuer.

               (ii) The execution and delivery of this Agreement, the
     consummation of the transactions contemplated hereby and compliance by
     Issuer with any of the provisions hereof will not (i) conflict with or
     result in a breach of any provision of its Charter or Bylaws or a default
     (or give rise to any right of termination, cancellation or acceleration)
     under any of the terms, conditions or provisions of any note, bond,
     debenture, mortgage, indenture, license, material agreement or other
     material instrument or obligation to which Issuer is a

                                       13
<PAGE>   14

     party, or by which it or any of its properties or assets may be bound, or
     (ii) violate any order, writ, injunction, decree, statute, rule or
     regulation applicable to Issuer or any of its properties or assets.

               (iii) Issuer has taken all necessary corporate action to
     authorize and reserve and to permit it to issue, and at all times from the
     date hereof through the termination of this Agreement in accordance with
     its terms will have reserved for issuance upon the exercise of the Option,
     that number of shares of Common Stock equal to the maximum number of shares
     of Common Stock at any time and from time to time issuable hereunder, and
     all such shares, upon issuance pursuant thereto, will be duly authorized,
     validly issued, fully paid and nonassessable, and will be delivered free
     and clear of all claims, liens, encumbrances and security interests and not
     subject to any preemptive rights.

          (b)  Grantee hereby represents and warrants to Issuer that:

               (i)   Grantee has full corporate power and authority to execute
     and deliver this Agreement and to perform its obligations hereunder. The
     execution and delivery of this Agreement by Grantee and the performance of
     its obligations hereunder by Grantee have been duly and validly authorized
     by all necessary corporate action on the part of Grantee and no other
     corporate proceedings on the part of Grantee are necessary to authorize
     this Agreement for Grantee to perform its obligations hereunder. This
     Agreement has been duly and validly executed and delivered by Grantee.

               (ii)  The Option is not being, and any shares of Common Stock or
     other securities acquired by Grantee upon exercise of the Option will not
     be, acquired with a view to the public distribution thereof and will not be
     transferred or otherwise disposed of except in a transaction registered or
     exempt from registration under the 1933 Act and any applicable securities
     offering rules of a federal or state banking authority.

     12.  Neither of the parties hereto may assign or otherwise transfer any of
its rights or obligations under this Agreement or the Option created hereunder
to any other person, without the express written consent of the other party,
except that in the event a Subsequent Triggering Event shall have occurred prior
to an Exercise Termination Event, Grantee, subject to the express provisions
hereof, may assign in whole or in part its rights and obligations hereunder,
provided, however, that until the date 15 days following the date on which the
Federal Reserve Board approves an application by Grantee under the BHCA to
acquire the shares of Common Stock subject to the Option, Grantee may not assign
its rights under the Option except in (i) a widely dispersed public
distribution, (ii) a private placement in which no one party acquires the right
to purchase in excess of 2% of the voting shares of Issuer, (iii) an assignment
to a single party (e.g., a broker or investment banker) for the sole purpose of
conducting a widely dispersed public distribution on Grantee's behalf or (iv)
any other manner approved by the Federal Reserve Board.

     13.  Each of Grantee and Issuer will use all reasonable efforts to make all
filings with, and to obtain consents of, all third parties and governmental
authorities necessary to the consummation

                                       14
<PAGE>   15

of the transactions contemplated by this Agreement, including, without
limitation, applying to the Federal Reserve Board under the BHCA for approval to
acquire the shares issuable hereunder and applying for listing or quotation of
such shares on any exchange or quotation system on which the Common Stock is
then listed or quoted.

     14.  (a)  Notwithstanding any other provision of this Agreement, in no
event shall the Grantee's Total Profit (as hereinafter defined) exceed
$10,000,000 (the "Maximum Profit") and, if it otherwise would exceed such
amount, the Grantee, at its sole election, shall either (i) reduce the number of
shares of Common Stock subject to this Option, (ii) deliver to the Issuer for
cancellation Option Shares previously purchased by Grantee, (iii) pay cash to
the Issuer or (iv) any combination thereof, so that Grantee's actually realized
Total Profit shall not exceed the Maximum Profit after taking into account the
foregoing actions. As used herein, the term "Total Profit" shall mean the
aggregate amount (before taxes) of the following: (i) the amount received by
Grantee pursuant to Issuer's repurchase of the Option (or any portion thereof)
pursuant to Section 7 hereof, (ii) (x) the amount received by Grantee pursuant
to Issuer's repurchase of the Option Shares pursuant to Section 7 hereof, less
(y) the Grantee's purchase price for such Option Shares, (iii) (x) the net cash
amounts received by Grantee pursuant to the sale of Option Shares (or any other
securities into which such Option Shares are converted or exchanged) to any
unaffiliated party, less (y) the Grantee's purchase price of such Option Shares,
(iv) any amounts received by Grantee on the transfer of the Option (or any
portion thereof) to any unaffiliated party and (v) any equivalent amount with
respect to the Substitute Option.

          (b)  Notwithstanding any other provision of this Agreement, this
Option may not be exercised for a number of shares as would, as of the date of
exercise, result in a Notional Total Profit (as hereinafter defined) of more
than the Maximum Profit, provided that nothing in this sentence shall restrict
any exercise of the Option permitted hereby on any subsequent date. As used
herein, the term "Notional Total Profit" with respect to any number of shares as
to which Grantee may propose to exercise this Option shall be the Total Profit
determined as of the date of such proposed exercise assuming that this Option
were exercised on such date for such number of shares and assuming that such
shares, together with all other Option Shares held by Grantee and its affiliates
as of such date, were sold for cash at the closing market price for the Common
Stock as of the close of business on the preceding trading day (less customary
brokerage commissions).

     15.  The parties hereto acknowledge that damages would be an inadequate
remedy for a breach of this Agreement by either party hereto and that the
obligations of the parties hereto shall be enforceable by either party hereto
through injunctive or other equitable relief. In connection therewith, both
parties waive the posting of any bond or similar requirement.

     16.  If any term, provision, covenant or restriction contained in this
Agreement is held by a court or a federal or state regulatory agency of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions and covenants and restrictions contained in this Agreement
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated. If for any reason such court or regulatory agency determines
that the Holder is not permitted to acquire, or Issuer or Substitute Option
Issuer, as the case may be, is not permitted to

                                       15
<PAGE>   16

repurchase pursuant to Section 7 or Section 9, as the case may be, the full
number of shares of Common Stock provided in Section l(a) hereof (as adjusted
pursuant to Section l(b) or Section 5 hereof), it is the express intention of
Issuer (which shall be binding on the Substitute Option Issuer) to allow the
Holder to acquire or to require Issuer or Substitute Option Issuer, as the case
may be, to repurchase such lesser number of shares as may be permissible,
without any amendment or modification hereof.

     17.  All notices, requests, claims, demands and other communications
hereunder shall be deemed to have been duly given when delivered in person, by
fax, telecopy or by registered or certified mail (postage prepaid, return
receipt requested) at the respective addresses of the parties set forth in the
Reorganization Agreement.

     18.  This Agreement shall be governed by and construed in accordance with
the laws of the State of Maine, without regard to the conflict of law principles
thereof.

     19.  This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
and the same agreement.

     20.  Except as otherwise expressly provided herein, each of the parties
hereto shall bear and pay all costs and expenses incurred by it or on its behalf
in connection with the transactions contemplated hereunder, including fees and
expenses of its own financial consultants, investment bankers, accountants and
counsel.

     21.  Except as otherwise expressly provided herein or in the Reorganization
Agreement, this Agreement contains the entire agreement between the parties with
respect to the transactions contemplated hereunder and supersedes all prior
arrangements or understandings with respect thereof, written or oral, including
without limitation the Stock Option Agreement, dated as of June 11, 2001. The
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and permitted
assigns. Nothing in this Agreement, express or implied, is intended to confer
upon any party, other than the parties hereto, and their respective successors
and permitted assigns any rights, remedies, obligations or liabilities under or
by reason of this Agreement, except as expressly provided herein.

     22.  Capitalized terms used in this Agreement and not defined herein shall
have the meanings assigned thereto in the Reorganization Agreement.

                                       16
<PAGE>   17

     IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all as of the
date first above written.

                               METROWEST BANK

                               By:    /s/ John J. McArdle III
                                      -------------------------------------
                               Name:  John J. McArdle III
                               Title: Chief Executive Officer

                               BANKNORTH GROUP, INC.

                               By:    /s/ Peter J. Verrill
                                      -------------------------------------
                               Name:  Peter J. Verrill
                               Title: Executive Vice President, Chief Operating
                                        Officer and Chief Financial Officer

                                       17<PAGE>   1
                                                                     EXHIBIT 4.4

                              AMENDED AND RESTATED
                           PATTERSON-UTI ENERGY, INC.
                         1996 EMPLOYEE STOCK OPTION PLAN

    SECTION 1.  PURPOSE

         This Amended and Restated Patterson-UTI Energy, Inc. 1996 Employee
Stock Option Plan (the "Plan") amends and restates the UTI Energy Corp. 1996
Employee Stock Option Plan to reflect the three-for-one stock dividend paid to
stockholders of a predecessor of the Company on September 5, 1997. The purpose
of the Plan is to promote the interests of the Company and its stockholders by
providing it with a mechanism to enable the Company and its subsidiaries to
attract, retain and motivate their key employees with compensatory arrangements
and benefits that make use of the Company's stock so as to provide for or
increase the proprietary interests of such employees in the Company.

    SECTION 2.  DEFINITIONS

    (A) "AGREEMENT" shall mean a written agreement setting forth the terms of an
Award.

    (B) "AWARD" shall mean an Option (which may be designated as an Incentive
Stock Option or a Non-Incentive Stock Option) granted under this Plan.

    (C) "BOARD" shall mean the Board of Directors of the Company.

    (D) "CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

    (E) "COMMITTEE" shall mean the committee appointed by the Board to
administer this Plan.

    (F) "COMMON STOCK" shall mean the Company's Common Stock, $.001 par value
(or such other par value as may be designated by act of the Company's
stockholders).

    (G) "COMPANY" shall mean Patterson-UTI Energy, Inc., a Delaware corporation.

    (H) "DISABILITY" shall mean a mental or physical disability which, in the
opinion of a physician selected by the Committee, shall prevent the Employee
from earning a reasonable livelihood with the Company or any Subsidiary and
which can be expected to result in death or which has lasted or can be expected
to last for a continuous period of not less than 12 months and which: (a) was
not contracted, suffered or incurred while the Employee was engaged in, or did
not result from having engaged in, a felonious criminal enterprise; (b) did not
result from alcoholism or addiction to narcotics; and (c) did not result from an
injury incurred while a member of the Armed Forces of the United States for
which the Employee receives a military pension.

<PAGE>   2

    (I) "DISINTERESTED" shall mean disinterested within the meaning of
applicable regulatory requirements, including those promulgated under Section 16
of the Exchange Act.

    (J) "EMPLOYEE" shall mean an officer or employee of the Company or a
Subsidiary.

    (K) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.

    (L) "FAIR MARKET VALUE" shall mean the closing sale price of a share of
Common Stock on that date as reported by the principal national securities
exchange on which the Common Stock is listed if the Common Stock is then listed
on a national securities exchange, or if the Common Stock is not so listed, the
average of the bid and asked price of a share of Common Stock on that date and
reported in the National Association of Securities Dealers Automated Quotation
system (the "NASDAQ System"); provided that if no such closing price or quotes
are so reported on that date or if in the discretion of the Committee another
means of determining the Fair Market Value of a share of stock at such date
shall be necessary or advisable, the Committee may provide for another means for
determining such Fair Market Value.

    (M) "INCENTIVE STOCK OPTION" shall mean an Option that is intended by the
Committee to meet the requirements of Section 422 of the Code or any successor
provision.

    (N) "NON-INCENTIVE STOCK OPTION" shall mean an Option granted pursuant to
this Plan which does not qualify as an Incentive Stock Option.

    (O) "OPTION" shall mean the right to purchase Common Stock at a price to be
specified and upon terms to be designated by the Committee pursuant to this
Plan. An Option shall be designated by the Committee as an Incentive Stock
Option or a Non-Incentive Stock Option.

    (P) "OPTION PRICE" shall mean the price at which shares may be purchased
pursuant to an Option.

    (Q)  "PLAN" shall mean this Patterson-UTI Energy, Inc. 1996 Employee Stock
Option Plan.

    (R) "RETIRE" or "RETIREMENT" shall mean retirement in accordance with the
terms of a retirement plan that is qualified under Section 401(a) of the Code
and maintained by the Company or a Subsidiary in which the employee is a
participant.

    (S) "SUBSIDIARY" shall mean any present or future subsidiary corporations,
as defined in Section 424 of the Code, of the Company.

    SECTION 3.  STOCK SUBJECT TO THE PLAN

    The total amount of the Common Stock with respect to which Awards may be
granted shall not exceed in the aggregate 900,000 shares. The class and
aggregate number of shares which may be subject to the Options granted under
this Plan shall be subject to adjustment under Section 7. Shares may be treasury
shares or authorized but unissued shares. If any Award under

--------------------------------------------------------------------------------
                                                                          Page 2
<PAGE>   3

the Plan shall expire or terminate for any reason without having been exercised
in full, or if any Award shall be forfeited, the shares subject to the
unexercised or forfeited portion of such Award shall again be available for the
purposes of the Plan.

    SECTION 4.  ADMINISTRATION

    The Plan shall be administered by a Committee the members of which shall be
Disinterested persons. The Committee shall consist of not less than two members
of the Board, who are not Employees. The Board shall have the power from time to
time to add or remove members of the Committee, and to fill vacancies arising
for any reason. The Committee shall designate a chairman from among its members,
who shall preside at all of its meetings, and shall designate a secretary,
without regard to whether that person is a member of the Committee, who shall
keep the minutes of the proceedings and all records, documents, and data
pertaining to its administration of the Plan. Meetings shall be held at any time
and place as it shall choose. A majority of the members of the Committee shall
constitute a quorum for the transaction of business. The vote of a majority of
those members present at any meeting shall decide any question brought before
that meeting. In addition, the Committee may take any action otherwise proper
under the Plan by the affirmative vote, taken without a meeting, of a majority
of its members. No member of the Committee shall be liable for any act or
omission of any other member of the Committee or for any act or omission on his
own part, including but not limited to the exercise of any power or discretion
given to him under the Plan, except those resulting from his own gross
negligence or willful misconduct. All questions of interpretation and
application of the Plan, or as to Awards granted under it shall be subject to
the determination of a majority of the Committee. The Committee in exercising
any power or authority granted under this Plan or in making any determination
under this Plan shall perform or refrain from performing those acts using its
sole discretion and judgment. Any decision made by the Committee or any
refraining to act or any act taken by the Committee in good faith shall be final
and binding on all parties. The Committee's decision shall never be subject to
de novo review. When appropriate the Plan shall be administered in order to
qualify certain of the Options granted under it as Incentive Stock Options.

    SECTION 5.  ELIGIBILITY

    The individuals who shall be eligible to participate in the Plan shall be
those full-time key Employees, including directors if they are Employees, as the
Committee shall determine during the term of this Plan. No individual shall be
eligible to receive an Award under the Plan while that individual is a member of
the Committee.

    No Employee who owns stock possessing more than 10% of the total combined
voting power of all classes of stock of the corporation employing the Employee
or of its parent or subsidiary corporation shall be eligible to receive an
Option which is an Incentive Stock Option unless at the time that the Option is
granted the option price is at least 110% of the Fair Market Value of the Common
Stock at the time the Option is granted and the Option by its own terms is not
exercisable after the expiration of five years from the date the Option is
granted.

--------------------------------------------------------------------------------
                                                                          Page 3
<PAGE>   4

    An Employee will be considered as owning the stock owned, directly or
indirectly, by or for his brothers and sisters (whether by the whole or half
blood), spouse, ancestors, and lineal descendants. Stock owned, directly or
indirectly, by or for a corporation, partnership, estate or trust will be
considered as being owned proportionately by or for its stockholders, partners
or beneficiaries. For all purposes of this Plan, a parent corporation is any
corporation (other than the Company) in an unbroken chain of corporations ending
with the Company if, on the date of grant of the Option in question, each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in that chain; and a subsidiary corporation is any corporation
(other than the Company) in an unbroken chain of corporations beginning with the
Company if, on the date of grant of the Option in question, each of the
corporations, other than the last corporation in the chain, owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in that chain.

    SECTION 6.  MAXIMUM NUMBER OF SHARES SUBJECT TO AN AWARD

    The maximum number of shares of Common Stock subject to Options that may be
awarded to any Employee under the Plan during any consecutive three year period
is 300,000, subject to adjustment as provided in Section 7 of the Plan.

    SECTION 7.  STOCK OPTIONS

    A.  AUTHORITY TO GRANT OPTIONS. The Committee may grant Incentive Stock
Options or Non-Incentive Stock Options at any time during the term of this Plan
to any eligible Employee that it chooses.

    Each Option granted shall be approved by the Committee. Subject only to any
applicable limitations set forth in this Plan, the number of shares of Common
Stock to be covered by an Option shall be as determined by the Committee.

    B. OPTION PRICE. The price at which shares may be purchased pursuant to an
Option shall be fixed by the Committee, but such price for an Incentive Stock
Option shall be not less than the Fair Market Value of the shares of Common
Stock on the date the Option is granted. The Committee in its discretion may
provide that the price at which shares may be purchased shall be more than the
minimum price required.

    C. DURATION OF OPTIONS. No Option which is an Incentive Stock Option shall
be exercisable after the expiration of ten years from the date such Option is
granted. The Committee in its discretion may provide that such Option shall be
exercisable throughout the ten year period or during any lesser period of time
commencing on or after the date of grant of such Option and ending upon or
before the expiration of the ten year period. If an Employee owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the corporation employing the Employee or of its parent or subsidiary
corporation, no Option which is an Incentive Stock Option shall be exercisable
after the expiration of five years from the date such Option is granted. No
Option which is a Non-Incentive Stock Option shall be exercisable after the
expiration of ten years from the date such Option is granted. The Committee in
its

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                                                                          Page 4
<PAGE>   5

discretion may provide that such Option shall be exercisable throughout the
ten year period or during any lesser period of time commencing on or after the
date of grant of such Option and ending upon or before the expiration of the ten
year period.

    D. MAXIMUM VALUE OF STOCK SUBJECT TO OPTIONS WHICH ARE INCENTIVE STOCK
OPTIONS. To the extent that the aggregate Fair Market Value (determined as of
the date the Option is granted) of the stock with respect to which Incentive
Stock Options are exercisable for the first time by the Optionee in any calendar
year (under this Plan and any other incentive stock option plan(s) of the
Company and any parent and subsidiary corporation) exceeds $100,000, the Options
shall be treated as Non-Incentive Stock Options. In making this determination,
Options shall be taken into account in the order in which they were granted.

    E. AMOUNT EXERCISABLE. The Committee, in its discretion, may fix the terms
of exercise of any Option so that any Option may be exercised so long as it is
valid and outstanding from time to time in part or as a whole in such manner and
subject to such conditions as it may set. In addition, the Committee, in its
discretion, may accelerate the time in which any outstanding Option may be
exercised. But in no event shall any Option be exercisable after the tenth
anniversary of the date of the grant.

    F. EXERCISE OF OPTIONS. An Optionee may exercise such optionee's Option by
delivering to the Company a written notice stating (i) that such optionee wishes
to exercise such Option on the date such notice is so delivered, (ii) the number
of shares of stock with respect to which the Option is to be exercised and (iii)
the address to which the certificate representing such shares of stock should be
mailed. In order to be effective, such written notice shall be accompanied by
(i) payment of the Option Price of such shares of stock and (ii) payment of an
amount of money necessary to satisfy any withholding tax liability that may
result from the exercise of such Option. Each such payment shall be made by
check drawn on a national banking association and payable to the order of the
Company in United States dollars or other check acceptable to the Committee.

    If, at the time of receipt by the Company of such written notice, (i) the
Company has unrestricted surplus in an amount not less than the Option Price of
such shares of stock, (ii) all accrued cumulative preferential dividends and
other current preferential dividends on all outstanding shares of preferred
stock of the Company have been fully paid, (iii) the acquisition by the Company
of its own shares of stock for the purpose of enabling such optionee to exercise
such Option is otherwise permitted by applicable law and without any vote or
consent of any stockholder of the Company, and (iv) there shall have been
adopted, and there shall be in full force and effect, a resolution of the Board
of Directors of the Company authorizing the acquisition by the Company of its
own shares of stock for such purpose, then such optionee may deliver to the
Company, in payment of the Option Price of the shares of stock with respect to
which such Option is exercised, (x) certificates registered in the name of such
optionee that represent a number of shares of stock legally and beneficially
owned by such optionee (free of all liens, claims and encumbrances of every
kind) and having a Fair Market Value on the date of receipt by the Company of
such written notice that is not greater than the Option Price of the shares of
stock with respect to which such Option is to be exercised, such certificates to
be accompanied by stock powers duly endorsed in blank by the record holder of
the shares of stock

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                                                                          Page 5
<PAGE>   6

represented by such certificates, with the signature of such record holder
guaranteed by a national banking association (or, in lieu of such certificates,
other arrangements for the transfer of such shares to the Company which are
satisfactory to the Company) and (y) if the Option Price of the shares of stock
with respect to which such Options are to be exercised exceeds such Fair Market
Value, a check drawn on a national banking association and payable to the order
of the Company in an amount, in United States dollars, equal to the amount of
such excess plus the amount of money necessary to satisfy any withholding tax
liability that may result from the exercise of such Option. Notwithstanding the
provisions of the immediately preceding sentence, the Committee, in its sole
discretion, may refuse to accept shares of stock in payment of the Option Price
of the shares of stock with respect to which such Option is to be exercised and,
in that event, any certificates representing shares of stock that were received
by the Company with such written notice shall be returned to such optionee,
together with notice by the Company to such optionee of the refusal of the
Committee to accept such shares of stock. The Company may, at its option and
upon approval by the Board of Directors of the Company, retain shares of Common
Stock which would otherwise be issued upon exercise of an Option to satisfy any
withholding tax liability that may result from the exercise of such Option,
which shares shall be valued for such purpose at their then Fair Market Value.
If, at the expiration of seven business days after the delivery to such optionee
of such written notice from the Company, such optionee shall not have delivered
to the Company a cashier's check drawn on a national banking association and
payable to the order of the Company in an amount, in United States dollars,
equal to the Option Price of the shares of stock with respect to which such
Option is to be exercised, such written notice from the optionee to the Company
shall be ineffective to exercise such Option.

    As promptly as practicable after the receipt by the Company of (i) such
written notice from the optionee, (ii) payment, in the form required by the
foregoing provisions of this Paragraph F, of the Option Price of the shares of
stock with respect to which such Option is to be exercised, and (iii) payment,
if required, in the form required by the foregoing provisions of this Paragraph
F, of an amount necessary to satisfy any withholding tax liability that may
result from the exercise of such Option, a certificate representing the number
of shares of stock with respect to which such Option has been so exercised,
reduced, to the extent applicable by the number of shares retained by the
Company to pay any required withholding tax, such certificate to be registered
in the name of such optionee, provided that such delivery shall be considered to
have been made when such certificate shall have been mailed, postage prepaid, to
such optionee at the address specified for such purpose in such written notice
from the optionee to the Company.

    G. TRANSFERABILITY OF OPTIONS. Options shall not be transferable by the
optionee except by will or under the laws of descent and distribution, and shall
be exercisable, during his lifetime, only by him. Any attempted sale,
assignment, transfer, pledge or encumbrance of an Option in violation of this
Agreement shall be void and the Company shall not be bound thereby.

    H. TERMINATION OF EMPLOYMENT OR DEATH OF OPTIONEE.

    1. Except as may be otherwise expressly provided in the Option Agreement
with respect to an Option that is a Non-Incentive Stock Option, all Options
shall terminate on the earlier of the date of the expiration of the Option or
one day less than three months after the date of severance,

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                                                                          Page 6
<PAGE>   7

upon severance of the employment relationship between the Company and the
optionee, whether with or without cause, for any reason other than the death,
Disability or, in the case of Non-Incentive Stock Options only, Retirement of
the optionee, during which period the optionee shall be entitled to exercise the
Option in respect of the number of shares that the optionee would have been
entitled to purchase had the optionee exercised the Option on the date of such
severance of employment. Whether authorized leave of absence, or absence on
military or government service, shall constitute severance of the employment
relationship between the Company and the optionee for purposes of the Plan shall
be determined by the Committee at the time thereof. In the event of severance
because of the Disability of the holder of any Incentive Stock Option while in
the employ of the Company and before the date of expiration of such Incentive
Stock Option, such Incentive Stock Option shall terminate on the earlier of such
date of expiration or one year following the date of such severance because of
Disability, during which period the optionee shall be entitled to exercise the
Incentive Stock Option in respect to the number of shares that the optionee
would have been entitled to purchase had the optionee exercised the Incentive
Stock Option on the date of such severance because of Disability.

    2. In the event of the death of the holder of any Incentive Stock Option
while in the employ of the Company and before the date of expiration of such
Incentive Stock Option, such Incentive Stock Option shall terminate on the
earlier of such date of expiration or one year following the date of death.
After the death of the optionee, his executors, administrators or any person or
persons to whom his Incentive Stock Option may be transferred by will or by the
laws of descent and distribution, shall have the right, at any time prior to the
termination of an Incentive Stock Option to exercise the Incentive Stock Option,
in respect to the number of shares that the optionee would have been entitled to
exercise if he had exercised the Incentive Stock Option on the date of his death
while in employment. For purposes of Incentive Stock Options issued under this
Plan, an employment relationship between the Company and the optionee shall be
deemed to exist during any period in which the optionee is employed by the
Company, a corporation issuing or assuming an option in a transaction to which
Section 424(a) of the Code applies, or a parent or subsidiary corporation of
such corporation issuing or assuming an option. For this purpose, the phrase
"corporation issuing or assuming an option" shall be substituted for the word
"Company" in the definitions of parent and subsidiary corporations in Section 5
and the parent-subsidiary relationship shall be determined at the time of the
corporate action described in Section 424(a) of the Code.

    3. In the event of the death, Disability, or Retirement of a holder of a
Non-Incentive Stock Option, before the date of expiration of such Non-Incentive
Stock Option, such Non-Incentive Stock Option shall continue fully in effect,
including provisions providing for subsequent vesting of such Option, and shall
terminate on the date of expiration of the Non-Incentive Stock Option. After the
death of the optionee, his executors, administrators or any person or persons to
whom his Non-Incentive Stock Option may be transferred by will or by the laws of
descent and distribution, shall have the right, at any time prior to the
termination of the Non-Incentive Stock Option to exercise the Non-Incentive
Stock Option, in respect to the number of shares that the optionee would have
been entitled to exercise if he were still alive. Notwithstanding the foregoing
provisions of this Section, in the case of a Non-Incentive Stock Option the
Committee may provide for a different option termination date in the Option
Agreement with respect to such Option.

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                                                                          Page 7
<PAGE>   8

    I. NO RIGHTS AS STOCKHOLDER. No optionee shall have rights as a stockholder
with respect to shares covered by his Option until the date a stock certificate
is issued for the shares. Except as provided in the following provisions of this
Section 7, no adjustment for dividends, or other matters shall be made if the
record date is prior to the date the certificate is issued.

    J. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE. The existence of outstanding
Options shall not affect in any way the right or power of the Company or its
stockholders to make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or its
business, or any merger or consolidation of the Company, or any issue of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock or the rights thereof, or the dissolution or liquidation of the Company,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character or otherwise.

    If the Company shall effect a subdivision or consolidation of shares or
other capital adjustment of, or the payment of a dividend in capital stock or
other equity securities of the Company on, its Common Stock, or other increase
or reduction of the number of shares of the Common Stock without receiving
consideration therefor in money, services, or property, or the reclassification
of its Common Stock, in whole or in part, into other equity securities of the
Company, then (a) the number, class and per share price of shares of stock
subject to outstanding Options hereunder shall be appropriately adjusted (or in
the case of the issuance of equity securities as a dividend on, or in a
reclassification of, the Common Stock, the Options shall extend to such other
securities) in such a manner as to entitle an optionee to receive, upon exercise
of an Option, for the same aggregate cash compensation, the same total number
and class or classes of shares (or in the case of a dividend of, or
reclassification into, other equity securities, such other securities) he would
have held after such adjustment if he had exercised his Option in full
immediately prior to the event requiring the adjustment, or, if applicable, the
record date for determining stockholders to be affected by such adjustment; and
(b) the number and class of shares then reserved for issuance under the Plan (or
in the case of a dividend of, or reclassification into, other equity securities,
such other securities) shall be adjusted by substituting for the total number
and class of shares of stock then received, the number and class or classes of
shares of stock (or in the case of a dividend of, or reclassification into,
other equity securities, such other securities) that would have been received by
the owner of an equal number of outstanding shares of Common Stock as the result
of the event requiring the adjustment. Comparable rights shall accrue to each
optionee in the event of successive subdivisions, consolidations, capital
adjustment, dividends or reclassifications of the character described above.

    If the Company shall distribute to all holders of its shares of Common Stock
(including any such distribution made to non-dissenting stockholders in
connection with a consolidation or merger in which the Company is the surviving
corporation and in which holders of shares of Common Stock continue to hold
shares of Common Stock after such merger or consolidation) evidences of
indebtedness or cash or other assets (other than cash dividends payable out of
consolidated retained earnings not in excess of, in any one year period, the
greater of (a) $.10 per share of Common Stock and (b) two times the aggregate
amount of dividends per share paid

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                                                                          Page 8
<PAGE>   9

during the preceding calendar year and dividends or distributions payable in
shares of Common Stock or other equity securities of the Company described in
the immediately preceding paragraph), then in each case the Option Price shall
be adjusted by reducing the Option Price in effect immediately prior to the
record date for the determination of stockholders entitled to receive such
distribution by the Fair Market Value, as determined in good faith by the Board
of Directors of the Company (whose determination shall be described in a
statement filed in the Company's corporate records and be available for
inspection by any holder of an Option) of the portion of the evidence of
indebtedness or cash or other assets so to be distributed applicable to one
share of Common Stock; provided that in no event shall the Option Price be less
than the par value of a share of Common Stock. Such adjustment shall be made
whenever any such distribution is made, and shall become effective on the date
of the distribution retroactive to the record date for the determination of the
stockholders entitled to receive such distribution. Comparable adjustments shall
be made in the event of successive distributions of the character described
above.

    After the Company shall make a tender offer for, or grant to all of its
holders of its shares of Common Stock the right to require the Company to
acquire from such stockholders shares of, Common Stock, at a price in excess of
the Current Market Price (a "Put Right") or the Company shall grant to all of
its holders of its shares of Common Stock the right to acquire shares of Common
Stock for less than the Current Market Price (a "Purchase Right") then, in the
case of a Put Right, the Option Price shall be adjusted by multiplying the
Option Price in effect immediately prior to the record date for the
determination of stockholders entitled to receive such Put Right by a fraction,
the numerator of which shall be the number of shares of Common Stock then
outstanding minus the number of shares of Common Stock which could be purchased
at the Current Market Price for the aggregate amount which would be paid if all
Put Rights are exercised and the denominator of which is the number of shares of
Common Stock which would be outstanding if all Put Rights are exercised; and, in
the case of a Purchase Right, the Option Price shall be adjusted by multiplying
the Option Price in effect immediately prior to the record date for the
determination of the stockholders entitled to receive such Purchase Right by a
fraction, the numerator of which shall be the number of shares of Common Stock
then outstanding plus the number of shares of Common Stock which could be
purchased at the Current Market Price for the aggregate amount which would be
paid if all Purchase Rights are exercised and the denominator of which is the
number of shares of Common Stock which would be outstanding if all Purchase
Rights are exercised. In addition, the number of shares subject to the Option
shall be increased by multiplying the number of shares then subject to the
Option by a fraction which is the inverse of the fraction used to adjust the
Option Price. Notwithstanding the foregoing if any such Put Rights or Purchase
Rights shall terminate without being exercised, the Option Price and number of
shares subject to Option shall be appropriately readjusted to reflect the Option
Price and number of shares subject to the Option which would have been in effect
if such unexercised Rights had never existed. Comparable adjustments shall be
made in the event of successive transactions of the character described above.

    After the merger of one or more corporations into the Company, after any
consolidation of the Company and one or more corporations, or after any other
corporate transaction described in Section 424(a) of the Internal Revenue Code
of 1986, as amended (the "Code") in which the Company shall be the surviving
corporation, each optionee, at no additional cost, shall be

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                                                                          Page 9
<PAGE>   10

entitled to receive, upon any exercise of his Option, in lieu of the number of
shares as to which the Option shall then be so exercised, the number and class
of shares of stock or other equity securities to which the optionee would have
been entitled pursuant to the terms of the agreement of merger or consolidation
if at the time of such merger or consolidation such optionee had been a holder
of a number of shares of Common Stock equal to the number of shares as to which
the Option shall then be so exercised and, if as a result of such merger,
consolidation or other transaction, the holders of Common Stock are not entitled
to receive any shares of Common Stock pursuant to the terms thereof, each
optionee, at no additional cost, shall be entitled to receive, upon exercise of
his Option, such other assets and property, including cash, to which he would
have been entitled if at the time of such merger, consolidation or other
transaction he had been the holder of the number of shares of Common Stock equal
to the number of shares as to which the Option shall then be so exercised.
Comparable rights shall accrue to each optionee in the event of successive
mergers or consolidations of the character described above.

    After a merger of the Company into one or more corporations, after any
consolidation of the Company and any one or more corporations, or after any
other corporate transaction described in Section 424(a) of the Code in which the
Company is not the surviving corporation, each optionee shall, at no additional
cost, be entitled at the option of the surviving corporation, (i) to have his
then existing Option assumed or to have a new option substituted for the
existing Option by the surviving corporation to the transaction which is then
employing him, or a parent or subsidiary of such corporation, on a basis where
the excess of the aggregate Fair Market Value of the shares subject to the
option immediately after the substitution or assumption over the aggregate
option price of such option is equal to the excess of the aggregate Fair Market
Value of all shares subject to the option immediately before such substitution
or assumption over the aggregate option price of such shares, provided that the
shares subject to the new option must be traded on the New York Stock Exchange
or the American Stock Exchange or quoted on the NASDAQ, or (ii) to receive upon
any exercise of his Option, in lieu of the number of shares as to which the
Option shall then be so exercised, the securities, property and other assets,
including cash, to which the Optionee would have been entitled pursuant to the
terms of the agreement of merger or consolidation or the agreement giving rise
to the other corporate transaction if at the time of such merger, consolidation
or other transaction such optionee had been the holder of the number of shares
of Common Stock equal to the number of shares as to which the Option shall then
be so exercised.

    If a corporate transaction described in Section 424(a) of the Code which
involves the Company is to take place and there is to be no surviving
corporation while an Option remains in whole or in part unexercised, it shall be
cancelled by the Board of Directors as of the effective date of any such
corporate transaction but before the date each optionee shall be provided with a
notice of such cancellation and each optionee shall have the right to exercise
such Option in full (without regard to any limitations set forth in or imposed
pursuant to Paragraph 9 of the Plan) to the extent it is then still unexercised
during a 30-day period preceding the effective date of such corporate
transaction.

    For purposes of this Paragraph J, "Current Market Price per share of Common
Stock" shall mean the closing price of a share of Common Stock on the principal
national securities exchange on which the Common Stock is listed or, if the
Common Stock is not so listed, the average bid

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                                                                         Page 10
<PAGE>   11

and asked price of a share of Common Stock as reported in the NASDAQ System, in
each case on the trading day immediately preceding the first trading day on
which, as a result of the establishment of a record date or otherwise, the
trading price reflects that an acquiror of Common Stock in the public market
will not participate in or receive the payment of any applicable dividend or
distribution.

    Except a hereinbefore expressly provided, the issue by the Company of shares
of Common Stock of any class, or securities convertible into shares of stock of
any class, for cash or property, or for labor or services either upon direct
sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock then
subject to outstanding Options.

    K. SUBSTITUTION OPTIONS. Options may be granted under this Plan from time to
time in substitution for stock options held by employees of other corporations
who are about to become employees of the Company, or whose employer is about to
become a parent or subsidiary corporation, conditioned in the case of an
incentive stock option upon the employee becoming an employee as the result of a
merger or consolidation of the Company with another corporation, or the
acquisition by the Company of substantially all the assets of another
corporation, or the acquisition by the Company of at least 50% of the issued and
outstanding stock of another corporation as the result of which it becomes a
subsidiary of the Company. The terms and conditions of the substitute Options
granted may vary from the terms and conditions of this Plan to the extent the
Board at the time of grant may deem appropriate to conform, in whole or in part,
to the provisions of the stock options in substitution for which they are
granted. But with respect to stock options which are incentive stock options, no
variation shall be made which will affect the status of any substitute option as
an "incentive stock option" under Section 422 of the Code.

    L. ACCELERATION AND CANCELLATION OF OPTION IN CONTEMPLATION OF CHANGE IN
CONTROL. Notwithstanding the provisions of this Section 7, the Committee shall
have the power, in the event of a disposition of all or substantially all of the
assets of the Company, or the dissolution of the Company, or any merger or
consolidation of the Company with or into any other Company, or the merger or
consolidation of any other entity into the Company, or the making of a tender
offer to purchase 30% or more of the outstanding shares of Common Stock, to
amend all outstanding Options (upon such conditions as it shall deem
appropriate) to (i) permit the exercise of Options prior to the effective date
of the transaction and to terminate all unexercised Options as of such date or
(ii) require the forfeiture of all Options, provided the Company pays to each
Optionee the excess of the Fair Market Value of the Stock subject to the Option
over the exercise price of the Option, or (iii) make any other provision with
respect to the Options that the Committee deems appropriate and equitable.

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                                                                         Page 11
<PAGE>   12

    SECTION 8.  REQUIREMENTS OF LAW

    The Company shall not be required to sell, issue or deliver any shares of
Common Stock under any Award if such sale, issuance or delivery shall constitute
a violation by the Award recipient or the Company of any provisions of any law
or regulation of any governmental authority. Each Award granted under this Plan
shall be subject to the requirements that, if at any time the Board or the
Committee shall determine that the listing, registration or qualification of the
shares upon any securities exchange or under any state or federal law of the
United States or of any other country or governmental subdivision, or the
consent or approval of any governmental regulatory body, or investment or other
representations, are necessary or desirable in connection with the issue, or
purchase or delivery of shares subject to an Award, that Award shall not be
exercised in whole or in part and no shares shall be delivered pursuant to an
Award unless the listing, registration, qualification, consent, approval or
representations shall have been effected or obtained free of any conditions not
acceptable to the Committee. Any determination in this connection by the
Committee shall be final. In the event the shares issuable or deliverable on
exercise or vesting of an Award are not registered under the Securities Act of
1933, the Company may imprint on the certificate for those shares the following
legend or any other legend which counsel for the Company considers necessary or
advisable to comply with the Securities Act of 1933:

    "The shares of stock represented by this certificate have not been
    registered under the Securities Act of 1933 or under the securities laws of
    any state and may not be sold or transferred except upon registration or
    upon receipt by the Corporation of an opinion of counsel satisfactory to the
    Corporation, in form and substance satisfactory to the Corporation, that
    registration is not required for a sale or transfer."

The Company may, but shall in no event be obligated to, register any securities
covered by this Plan under the Securities Act of 1933 (as now in effect or as
later amended) and, in the event any shares are registered, the Company may
remove any legend on certificates representing those shares. The Company shall
not be obligated to take any other affirmative action in order to cause the
exercise of an Award or the issuance or delivery of shares under the Award to
comply with any law or regulation or any governmental authority.

    SECTION 9.  EMPLOYMENT OBLIGATION

    The granting of any Award shall not impose upon the Company any obligation
to employ or continue to employ any Award recipient. The right of the Company to
terminate the employment of any officer or other Employee shall not be
diminished or affected by reason of the fact that an Award has been granted to
him.

    SECTION 10.  FORFEITURE FOR CAUSE

    Notwithstanding any other provision of this Plan, if the Committee finds by
a majority vote, that the Award recipient, before or after termination of his
employment with the Company (a) committed a fraud, embezzlement, theft, felony
or act of dishonesty in the course of his employment by the Company which
conduct damaged the Company or (b) disclosed trade

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                                                                         page 12
<PAGE>   13

secrets of the Company, then any outstanding options which have not been
exercised by the individual and any Awards which have not yet vested will be
forfeited. The decision of the Committee as to the cause of an Award recipient's
discharge, the damage done to the Company and the extent of the individual's
competitive activity will be final. No decision of the Committee, however, will
affect the finality of the discharge of the individual by the Company.

    SECTION 11.  AMENDMENT OR TERMINATION OF PLAN

    The Board may modify, revise or terminate this Plan at any time and from
time to time. However, without the further Company stockholder approval by a
majority of the votes cast at a duly held stockholders' meeting at which a
quorum representing a majority of all outstanding voting stock (or if the
provisions of the corporate charter, bylaws or applicable state law prescribe a
greater degree of stockholder approval for this action, without the degree of
stockholder approval thus required) is, either in person or by proxy, present
and voting on the issue, the Board may not (a) increase the aggregate number of
shares that may be subject to Awards pursuant to the provisions of this Plan;
(b) materially increase the benefits accruing to participants under this Plan or
(c) materially modify the requirements as to eligibility for participation in
this Plan unless, in each such case, the Board of Directors of the Company shall
have obtained an opinion of legal counsel to the effect that stockholder
approval of the amendment is not required (i) by law, (ii) by the applicable
rules and regulations of, or any agreement with, any national securities
exchange that the Common Stock is then listed on or if the Common Stock is not
so listed, the rules and regulations, or any agreement with, the National
Association of Securities Dealers, Inc., and (iii) in order to make available to
the optionee with respect to any option granted under the Plan, the benefits of
Rule 16b-3 of the Rules and Regulations under the Securities Exchange Act of
1934, or any similar or successor rule.

    SECTION 12.  WRITTEN AGREEMENT

    Each Award granted under this Plan shall be embodied in a written Agreement,
which shall be subject to the terms and conditions prescribed above, and shall
be signed by the recipient and by the appropriate officer of the Company for and
in the name and on behalf of the Company. Each Agreement shall contain any other
provisions consistent with this Plan that the Committee in its discretion shall
deem advisable.

    SECTION 13.  INDEMNIFICATION OF THE COMMITTEE

    The Company shall indemnify each present and future member of the Committee
against, and each member of the Committee shall be entitled without further act
on his part to indemnity from the Company for, all expenses (including the
amount of judgments and the amount of approved settlements made with a view to
the curtailment of costs of litigation, other than amounts paid to the Company
itself) reasonably incurred by him in connection with or arising out of any
action, suit or proceeding in which he may be involved by reason of his being or
having been a member of the Committee, whether or not he continues to be such
member of the Committee at the time of incurring such expenses; provided,
however, that such indemnity shall not include any expenses incurred by any such
member of the Committee (a) in respect of matters as to which he shall be
finally adjudged in any such action, suit or proceeding to have been guilty of
gross

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                                                                         Page 13
<PAGE>   14

negligence or willful misconduct in the performance of his duty as such member
of the Committee, or (b) in respect of any matter in which any settlement is
effected, to an amount in excess of the amount approved by the Company on the
advice of its legal counsel; and provided further, that no right of
indemnification under the provisions set forth herein shall be available to or
enforceable by any such member of the Committee unless, within sixty (60) days
after institution of any such action, suit or proceeding, he shall have offered
the Company, in writing, the opportunity to handle and defend the same at its
own expense. The foregoing right of indemnification shall inure to the benefit
of the heirs, executors or administrators of each such member of the Committee
and shall be in addition to all other rights to which such member of the
Committee may be entitled to as a matter of law, contract or otherwise. Nothing
in this Section shall be construed to limit or otherwise affect any right to
indemnification or payment of expense, or any provisions limiting the liability
of any officer or director of the Company or any member of the Committee,
provided by law, the Certificate of Incorporation of the Company or otherwise.

    SECTION 14.  AWARD GRANT TERMINATION.

    No Awards shall be granted pursuant to this Plan after December 18, 2005.

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