Document:

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                                                                   Exhibit 10.26

                                                     BOARD OF DIRECTORS APPROVED
                                                                 AUGUST 26, 2002

                          2002 OMNIBUS SECURITIES PLAN
                                       OF
                           PHILLIPS PETROLEUM COMPANY
                                   (2002-2006)

SECTION 1. PURPOSE AND ESTABLISHMENT

The purpose of the Omnibus Securities Plan of Phillips Petroleum Company (the
"Plan") is to benefit the Company's stockholders by encouraging high levels of
performance by individuals whose performance is a key element in achieving the
Company's continued financial and operational success, and to enable the Company
to recruit, reward, retain and motivate employees to work as a team to achieve
the Company's mission of being the top performer in each of our businesses by
rewarding the creation of shareholder value.

The 2002 Omnibus Securities Plan of Phillips Petroleum Company shall become
effective January 1, 2002, upon its adoption by the Company's stockholders at
the 2001 Annual Meeting.

SECTION 2. DEFINITIONS

For purposes of the Plan, the following terms, as used herein, shall have the
meaning specified:

(a)   "AWARD" or "AWARDS" means an award granted pursuant to Section 4 hereof.

(b)   "AWARD AGREEMENT" means an agreement described in Section 5 hereof entered
      into between the Company and a Participant, setting forth the terms,
      conditions and any limitations applicable to the Award granted to the
      Participant.
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(c)   "BENEFICIARY" means a person or persons designated by a Participant to
      receive, in the event of death, any unpaid portion of an Award held by the
      Participant. Any Participant may, subject to such limitations as may be
      prescribed by the Committee, designate one or more persons primarily or
      contingently as beneficiaries in writing upon forms supplied by and
      delivered to the Company, and may revoke such designations in writing. If
      a Participant fails effectively to designate a beneficiary, then the Award
      will be paid in the following order of priority:

      (i)   Surviving spouse;

      (ii)  Surviving children in equal shares;

      (iii) To the estate of the Participant.

(d)   "BOARD" means the Board of Directors of the Company as it may be comprised
      from time to time.

(e)   "CODE" means the Internal Revenue Code of 1986, as amended from time to
      time, or any successor statute.

(f)   "COMMITTEE" means the Compensation Committee of the Board or any successor
      committee with substantially the same responsibilities.

(g)   "COMPANY" means ConocoPhillips, a Delaware corporation or any successor
      corporation.

(h)   "COVERED EMPLOYEE" means a Participant designated prior to the grant of
      Restricted Stock or Performance Awards by the Committee as one who is or
      may be a "covered employee" within the meaning of Section 162(m)(3) of the
      Code in the year in which Restricted Stock or Performance Awards are
      expected to be taxable to such Participant.

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(i)   "DATE OF CHANGE OF CONTROL" shall mean the earliest date on which any of
      the occurrences listed in Section 9 of this Plan should occur.

(j)   "DISABILITY" shall mean the inability, in the opinion of the independent
      third party who administers the Long Term Disability Plan for the Company
      or as certified by a physician who is licensed as a Medical Doctor (M.D.)
      or a Doctor of Osteopathy (D.O.) that the Participant, because of an
      injury or sickness, is unable to work at a reasonable occupation which is
      available with the Company or at any gainful occupation which the
      Participant is or may become fitted.

(k)   "EMPLOYEE" means any individual who is a salaried employee of the Company
      or any Participating Subsidiary.

(l)   "EXECUTIVE OFFICER" means the Chief Executive Officer (CEO) position and
      those positions that report directly to the CEO and other positions so
      designated by the Compensation Committee.

(m)   "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended and
      in effect from time to time, or any successor statute.

(n)   "FAIR MARKET VALUE" in reference to the common stock of the Company means

      (i)   the average of the reported highest and lowest sales prices per
            share of such Stock during regular business hours as reported on the
            composite tape of New York Stock Exchange transactions (or such
            other reporting system as shall be selected by the Committee) on the
            relevant date; or

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      (ii)  in the absence of reported sales on that date, the average of the
            reported highest and lowest sales prices per share during regular
            business hours on the last previous day for which there was a
            reported sale.

      The Committee shall determine the Fair Market Value of any security that
      is not publicly traded, using such criteria as it shall determine, in its
      sole discretion, to be appropriate for such valuation.

(O)   "INSIDER" means any person who is subject to Section 16 of the Exchange
      Act.

(P)   "INVOLUNTARY TERMINATION" of a Participant means:

      (i)   Termination of the Participant's employment with the Company for any
            reason other than voluntary termination (except as provided in
            clause (ii)), death, disability or termination for cause,

      (ii)  A termination of employment by the Participant within 60 days
            following a reduction of ten percent or more of the Participant's
            annual salary or a reduction in the Participant's job
            responsibilities, or

      (iii) A termination of the Participant's employment by the Company as a
            consequence of refusing a transfer by the Company to a location in
            excess of 50 miles from the Participant's work location upon the
            Date of Change of Control, unless the move is covered by the
            Company's moving policy.

In no event shall a Participant be considered Involuntarily Terminated if he or
she is retained in the employment of the Company, its subsidiaries or
affiliates.

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(q)   "PARTICIPANT" means an Employee who has been designated by the Committee
      to be eligible for an Award pursuant to this Plan.

(r)   "PERFORMANCE GOAL" means a performance goal established by the Committee
      in connection with the grant of a Qualified Performance-Based Award, which
      is based on the attainment of specified levels of one or more of the
      following measures on either absolute or relative basis: earnings per
      share, sales, net profit after tax, gross profit, operating profit, cash
      generation, unit volume, return on equity, economic profit, safety, growth
      project achievement, change in working capital, return on capital, return
      on investment, shareholder return, and is established in writing by the
      Committee within the time period prescribed by Section 162(m) of the Code
      and related regulations.

(s)   "QUALIFIED PERFORMANCE-BASED AWARD" means an Award of Restricted Stock or
      Performance Units or another type of Award designated as such by the
      Committee at the time of grant, based upon a determination that (i) the
      recipient is a Covered Employee with respect to such Award and (ii) the
      Committee wishes such Award to qualify for the Section 162(m) Exemption.

(t)   "PARTICIPATING SUBSIDIARY" means an entity of the Company, of which the
      Company beneficially owns, directly or indirectly, more than 50% of the
      aggregate voting power of all outstanding classes and series of stock or
      membership interest, and in which one or more Employees are Participants,
      or are eligible for Awards pursuant to this Plan.

(u)   "RESTRICTED STOCK" means shares of Stock which have certain restrictions
      attached to the ownership thereof, which may be issued under Section 4.3.

(v)   "RETIREMENT" means termination of employment with the Company or a
      Participating Subsidiary which qualifies the Employee for Retirement as
      that term is defined in the

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      Retirement Income Plan of Phillips Petroleum Company or of the applicable
      retirement plan of a Participating Subsidiary.

(w)   "RULE 16B-3" means Rule 16b-3 promulgated by the Securities and Exchange
      Commission as now in force or as such regulation or successor regulation
      shall be hereafter amended.

(x)   "SECTION 16" means Section 16 of the Exchange Act or any successor
      regulation and the rules promulgated thereunder as they may be amended
      from time to time.

(y)   "SECTION 162(m) EXEMPTION" means the exemption from the limitation on
      deductibility imposed by Section 162(m) of the Code that is set forth in
      Section 162(m)(4)(C) of the Code.

(z)   "STOCK" means shares of common stock of the Company, par value $.01 or as
      modified from time to time.

(aa)  "STOCK APPRECIATION RIGHT" means a right, the value of which is determined
      relative to the appreciation in value of shares of Stock, which may be
      issued under Section 4.2.

(bb)  "STOCK OPTION" means a right to purchase shares of Stock granted pursuant
      to Section 4.1 and includes Incentive Stock Options and Non-Qualified
      Stock Options as defined in Section 4.1.

SECTION 3. ELIGIBILITY

Awards may be granted only to Employees who are designated as Participants from
time to time by the Committee. The Committee shall determine which Employees
shall be Participants, the types of Awards to be made to Participants and the
terms, conditions and limitations applicable to the Awards.

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SECTION 4. AWARDS

Awards may include, but are not limited to, those described in this Section 4.
The Committee may grant Awards singly, in tandem or in combination with other
Awards, as the Committee may in its sole discretion determine. Subject to the
other provisions of this Plan, Awards may also be granted in combination or in
tandem with, in replacement of, or as alternatives to, grants or rights under
this Plan and any other employee plan of the Company. The Committee must approve
all grants made under this Plan to the Chief Executive Officer. The Committee
may also designate from time to time other classes of officers or employees for
whom Committee approval will be required for grants of equity under this Plan.
The Chief Executive Officer shall have authority to approve stock option grants,
restricted stock, or other forms of equity compensation, to Participants other
than those whose grant has been designated by the Committee for approval by the
Committee.

4.1 STOCK OPTIONS

A Stock Option is a right to purchase a specified number of shares of Stock at a
specified price during such specified time as the Committee shall determine.

(a)   Options granted may be either of a type that complies with the
      requirements of incentive stock options as defined in Section 422 of the
      Code and is designated as such ("Incentive Stock Options") or of a type
      that does not comply with such requirements or is designated as not being
      an Incentive Stock Option ("Non-Qualified Options"). The maximum award
      term for all Stock Options awarded under this Plan shall be ten (10)
      years.

(b)   The exercise price per share of any Stock Option shall be no less than the
      Fair Market Value per share of the Stock subject to the option on the date
      the Stock Option is granted.

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(c)   A Stock Option may be exercised, in whole or in part, by giving written
      notice of exercise to the Company specifying the number of shares of Stock
      to be purchased.

(d)   The exercise price of the Stock subject to the Stock Option may be paid in
      cash or, at the discretion of the Committee, may also be paid by the
      tender of Stock already owned by the Participant, or through a combination
      of cash and Stock, or through such other means the Committee determines
      are consistent with the Plan's purpose and applicable law. No fractional
      shares of Stock will be issued or accepted.

(e)   Notwithstanding any other provision of this Plan, other than Section 8, no
      Participant may be granted Stock Options and Stock Appreciation Rights
      covering in excess of 2,000,000 shares of Stock in any calendar year. If
      Stock Appreciation Rights are granted in tandem with an equal number of
      Stock Options, the total number of shares covered by such Stock
      Appreciation Rights and Stock Options shall be deemed, for purposes of
      this limitation, to equal the number of shares covered by such Stock
      Options.

4.2 STOCK APPRECIATION RIGHTS

A Stock Appreciation Right is a right to receive, upon surrender of the right,
but without payment, an amount payable in cash and/or shares of Stock under the
terms and conditions as the Committee shall determine.

(a)   A Stock Appreciation Right may be granted in tandem with part or all of,
      in addition to, or completely independent of a Stock Option or any other
      Award under this Plan. A Stock Appreciation Right issued in tandem with a
      Stock Option may be granted at the time of grant of the related Stock
      Option or at any time thereafter during the term of the Stock Option.

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(b)   The amount payable in cash and/or shares of Stock with respect to each
      right shall be equal in value to a percent of the amount by which the Fair
      Market Value per share of Stock on the exercise date exceeds the exercise
      price of the Stock Appreciation Right. The applicable percent shall be
      established by the Committee. The amount payable in shares of Stock, if
      any, is determined with reference to the Fair Market Value on the date of
      exercise.

(c)   Stock Appreciation Rights issued in tandem with Stock Options shall be
      exercisable only to the extent that the Stock Options to which they relate
      are exercisable. Upon exercise of the Stock Appreciation Right, the
      Participant shall surrender to the Company the underlying Stock Option.
      Stock Appreciation Rights issued in tandem with Stock Options shall
      automatically terminate upon the exercise of such Stock Options.

(d)   Grants of Stock Appreciation Rights are subject to the limitations set
      forth in Section 4.1(e) above.

4.3 RESTRICTED STOCK

Restricted Stock is Stock that is issued to a Participant and is subject to such
terms, conditions and restrictions as the Committee deems appropriate, which may
include, but is not limited to, restrictions upon the sale, assignment, transfer
or other disposition of the Restricted Stock and the requirement of forfeiture
of the Restricted Stock upon termination of employment under certain specified
conditions. The Committee may provide for the lapse of any such term or
condition or waive any term or condition based on such factors or criteria as
the Committee may determine. Pursuant to this Section 4.3, an Award of
Restricted Stock may be either time-lapsed Restricted Stock or Performance-Based
Restricted Stock. The Participant shall have, with respect to awards of
Restricted Stock, all of the rights of a shareholder of the Company, including
the right to vote the Restricted Stock and the right to receive any cash or
stock dividends on such Stock.

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4.4 PERFORMANCE AWARDS

Performance Awards may be granted under this Plan from time to time based on the
terms and conditions as the Committee deems appropriate provided that such
Awards shall not be inconsistent with the terms and purposes of this Plan.
Performance Awards are Awards which are contingent upon the performance of all
or a portion of the Company and/or its Participating Subsidiaries or which are
contingent upon the individual performance of a Participant. Performance Awards
may be in the form of performance units, performance shares and such other forms
of performance Awards which the Committee shall determine. The Committee shall
determine the performance measurements and criteria for such Performance Awards.

4.5 OTHER AWARDS

The Committee may from time to time grant stock, other stock-based and non-stock
based Awards under the Plan including without limitations those Awards pursuant
to which shares of stock are or may in the future be acquired, Awards
denominated in stock units, securities convertible into stock, phantom
securities and dividend equivalents. The Committee shall determine the terms and
conditions of such other stock, stock-based and non-stock based Awards provided
that such Awards shall not be inconsistent with the terms and purposes of this
Plan.

4.6 QUALIFIED PERFORMANCE-BASED AWARDS

The provisions of this Section 4.6 shall apply to all Qualified
Performance-Based Awards, notwithstanding any other provision of this Plan,
other than Sections 8 and 9. No Participant may be granted Qualified
Performance-Based Awards covering in excess of 2,000,000 shares of Stock or
allowing for the payment of cash in excess of $10,000,000 in any calendar year.
Each Qualified Performance-Based Award shall be earned, vested and payable (as
applicable) only upon the achievement of one or more Performance Goals (together
with the satisfaction of any other

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conditions, such as continued employment, as the Committee may determine to be
appropriate); provided, that (i) the Committee may provide, either in connection
with the grant thereof or by amendment thereafter, that achievement of such
Performance Goals will be waived upon the death or disability of the
Participant, and (ii) the provisions of Sections 8 and 9 shall apply
notwithstanding this sentence. Except as specifically provided in the preceding
sentence, no Qualified Performance-Based Award may be amended, nor may the
Committee exercise any discretionary authority it may otherwise have under this
Plan with respect to a Qualified Performance-Based Award under this Plan, in any
manner to waive the achievement of the applicable Performance Goals or to
increase the amount payable pursuant thereto or the value thereof, or otherwise
in a manner that would cause the Qualified Performance-Based Award to cease to
qualify for the Section 162(m) Exemption. Under this Plan, a Qualified
Performance-Based Award may include Restricted Stock.

SECTION 5. AWARD AGREEMENTS

Each Award under this Plan shall be evidenced by an Award Agreement setting
forth the number of shares of Stock or other security, Stock Appreciation
Rights, or units subject to the Award and such other terms and conditions
applicable to the Award as determined by the Committee.

(a)   Award Agreements shall include the following terms:

      (i)   NON-ASSIGNABILITY: A provision that the Awards under the Plan other
            than Awards representing Non-Qualified Stock Options shall not be
            assigned, pledged or otherwise transferred except by will or by the
            laws of descent and distribution, and that during the lifetime of a
            Participant, an Award other than an Award representing Non-Qualified
            Stock Options shall be exercised only by such Participant or by the
            Participant's legal guardian or legal representative.

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      (ii)  TERMINATION OF EMPLOYMENT: A provision describing the treatment of
            an Award in the event of the Retirement, Disability, death or other
            termination of a Participant's employment with the Company,
            including but not limited to terms relating to the vesting, time for
            exercise, forfeiture or cancellation of an Award in such
            circumstances.

      (iii) RIGHTS AS STOCKHOLDER: A provision that a Participant shall have no
            rights as a stockholder with respect to any securities covered by an
            Award until the date the Participant becomes the holder of record.
            Except as provided in Section 8 hereof, no adjustment shall be made
            for dividends or other rights, unless the Award Agreement
            specifically requires such adjustment, in which case, grants of
            dividend equivalents or similar rights shall not be considered to be
            a grant of any other stockholder right.

      (iv)  WITHHOLDING: A provision requiring the withholding of applicable
            taxes required by law from all amounts paid in satisfaction of an
            Award. In the case of an Award paid in cash, the withholding
            obligation shall be satisfied by withholding the applicable amount
            and paying the net amount in cash to the Participant. In the case of
            Awards paid in shares of Stock or other securities of the Company, a
            Participant may satisfy the withholding obligation by paying the
            amount of any taxes in cash or, with the approval of the Committee,
            shares of Stock or other securities may be deducted from the payment
            to satisfy the Company's minimum withholding obligation in full or
            in part as long as such withholding of shares does not violate any
            applicable laws, rules or regulations of Federal, state or local
            authorities. The number of shares to be deducted shall be determined
            by reference to the Fair Market Value of such shares of Stock on the
            applicable date.

(b) Award Agreements may include the following terms:

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      (i)   REPLACEMENT AND SUBSTITUTION: Except as provided in Section 13 (b)
            dealing with repricing of Stock Options, such provisions permitting
            the surrender of outstanding Awards or securities held by the
            Participant in order to exercise or realize rights under other
            Awards, or in exchange for the grant of new Awards under similar or
            different terms, may be included.

      (ii)  TRANSFERABILITY OF NON-QUALIFIED STOCK OPTIONS: Such provisions as
            the Committee may, in its discretion, authorize in any particular
            case, with respect to all or any portion of any Non-Qualified Stock
            Options to be granted to Participant, the transfer by such
            Participant of any of such Non-Qualified Stock Options to (a) the
            spouse, children or grandchildren (including in each case
            stepchildren or step grandchildren) of the Participant (all such
            persons collectively "Immediate Family Members"), (b) a trust or
            trusts for the exclusive benefit of persons all of whom are
            Immediate Family Members, or (c) a partnership in which all partners
            are Immediate Family Members, provided that following any such
            permitted transfer, subsequent transfers of transferred
            Non-Qualified Stock Options, except by will or the laws of descent
            and distribution, are prohibited. Following any transfer
            contemplated hereby, the transferred Non-Qualified Stock Options
            shall continue to be subject to all of the terms hereof,
            administrative procedures and the Award Agreement pursuant to which
            it was originally granted, and the transferee shall be obliged to
            comply in all respects with all of the terms and conditions hereof,
            the administrative procedures and the Award Agreement in the same
            manner as if the transferee were a Participant hereunder.

      (iii) OTHER TERMS: Such other terms as are necessary and appropriate to
            effect an Award to the Participant including but not limited to the
            term of the Award, vesting provisions, deferrals, any requirements
            for continued employment with the

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            Company, any other restrictions or conditions (including performance
            requirements) on the Award and the method by which restrictions or
            conditions lapse, effect on the Award of a Change of Control as
            defined in Section 9, the price, amount or value of Awards.

SECTION 6. SHARES OF STOCK SUBJECT TO THE PLAN

(a)   Subject to the adjustment provisions of Section 8 hereof, the number of
      shares of Stock for which Awards may be granted during the term of this
      Plan shall be 12,500,000; provided, that immediately following the
      Effective Time of the Merger (as those terms are defined in the next
      sentence), the number of shares of Stock for which Awards may be granted
      during the term of this Plan shall be increased by the product of (i) a
      fraction, the numerator of which is 12,500,000 and the denominator of
      which is the number of shares of Stock outstanding immediately before the
      Effective Time times (ii) the number of shares of Stock issued by the
      Company to stockholders of Tosco Corporation pursuant to the Merger; and
      provided, further, that the numbers described in clauses (i) and (ii) of
      the preceding proviso shall be adjusted as appropriate in the event there
      is any adjustment made pursuant to Section 8 hereof before the Effective
      Time of the Merger. The terms "Effective Time" and "Merger" shall have the
      meanings given to them in the Agreement and Plan of Merger, dated as of
      February 4, 2001, by and among the Company, Ping Acquisition Corp. and
      Tosco Corporation, as the same may be amended from time to time.

      Shares issued under the Plan which do not fall under Section 4.1 or 4.2
      shall be limited to 2,000,000 shares during the term of the Plan;
      provided, that immediately following the Effective Time of the Merger, the
      2,000,000 share limitation shall be increased by the

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      product of (i) a fraction, the numerator of which is 2,000,000 and the
      denominator of which is the number of shares of Stock outstanding
      immediately before the Effective Time times (ii) the number of shares of
      Stock issued by the Company to stockholders of Tosco Corporation pursuant
      to the Merger; and provided, further, that the numbers described in
      clauses (i) and (ii) of the preceding proviso shall be adjusted as
      appropriate in the event there is any adjustment made pursuant to Section
      8 hereof before the Effective Time of the Merger.

(b)   Any unexercised or undistributed portion of any terminated, expired,
      exchanged, or forfeited Award or Awards settled in cash in lieu of shares
      of Stock shall be available for further Awards in addition to those
      available under Section 6(a) hereof.

(c)   For the purposes of computing the total number of shares of Stock granted
      under the Plan, the following rules shall apply to Awards payable in Stock
      or other securities, where appropriate:

      (i)   except as provided in (v) of this Section, each Stock Option shall
            be deemed to be the equivalent of the maximum number of shares that
            may be issued upon exercise of the particular Stock Option;

      (ii)  except as provided in (v) of this Section, each other stock-based
            Award payable in some other security shall be deemed to be equal to
            the number of shares to which it relates;

      (iii) except as provided in (v) of this Section, where the number of
            shares available under the Award is variable on the date it is
            granted, the number of shares shall be deemed to be the maximum
            number of shares that could be received under that particular Award;

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      (iv)  where one or more types of Awards (both of which are payable in
            shares of Stock or another security) are granted in tandem with each
            other, such that the exercise of one type of Award with respect to a
            number of shares cancels an equal number of shares of the other,
            each joint Award shall be deemed to be the equivalent of the number
            of shares under the other; and

      (v)   each share awarded or deemed to be awarded under the preceding
            subsections shall be treated as shares of Stock, even if the Award
            is for a security other than Stock.

Additional rules for determining the number of shares of Stock granted under the
Plan may be made by the Committee, as it deems necessary or appropriate.

(d)   The Stock which may be issued pursuant to an Award under the Plan may be
      treasury or authorized but unissued Stock or Stock may be acquired,
      subsequently or in anticipation of the transaction, in the open market to
      satisfy the requirements of the Plan.

SECTION 7. ADMINISTRATION

(a)   A majority of the members of the Committee shall constitute a quorum. The
      vote of a majority of a quorum shall constitute action by the Committee.

(b)   The Committee shall periodically determine the Participants in the Plan
      and the nature, amount, pricing, timing, and other terms of Awards to be
      made to such individuals.

(c)   The Committee shall have the power to interpret and administer the Plan.
      All questions of interpretation with respect to the Plan, the number of
      shares of Stock or other security, Stock Appreciation Rights, or units
      granted, and the terms of any Award Agreements shall be

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      determined by the Committee and its determination shall be final and
      conclusive upon all parties in interest. In the event of any conflict
      between an Award Agreement and the Plan, the terms of the Plan shall
      govern.

(d)   It is the intent of the Company that the Plan and Awards hereunder satisfy
      and be interpreted in a manner, that, in the case of Participants who are
      or may be Insiders, satisfies the applicable requirements of Rule 16b-3,
      so that such persons will be entitled to the benefits of Rule 16b-3 or
      other exemptive rules under Section 16 and will not be subjected to
      avoidable liability thereunder. If any provision of the Plan or of any
      Award would otherwise frustrate or conflict with the intent expressed in
      this Section 7(d), that provision, to the extent possible, shall be
      interpreted and deemed amended so as to avoid such conflict. To the extent
      of any remaining irreconcilable conflict with such intent, the provision
      shall be deemed void as applicable to Insiders.

(e)   The Committee may delegate to the officers or employees of the Company the
      authority to execute and deliver such instruments and documents, to do all
      such acts and things, and to take all such other steps deemed necessary,
      advisable or convenient for the effective administration of the Plan in
      accordance with its terms and purpose, except that the Committee may not
      delegate any discretionary authority with respect to substantive decisions
      or functions regarding the Plan or Awards thereunder as these relate to
      any Qualified Performance-Based Awards nor to Insiders including, but not
      limited to, decisions regarding the timing, eligibility, pricing, amount
      or other material term of such Awards.

SECTION 8. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

Subject to any required action by the Company's stockholders, in the event of a
reorganization, recapitalization, Stock split, Stock dividend, exchange of
Stock, combination of Stock, merger, consolidation or any other change in
corporate structure of the Company affecting the Stock, or in

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the event of a sale by the Company of all or a significant part of its assets,
or any distribution to its stockholders other than a normal cash dividend, the
Committee may make appropriate adjustment in the number, kind, price and value
of Stock authorized by this Plan, in the limitations imposed by Sections 4.1(e)
and 4.6, and any adjustments to outstanding Awards as it determines appropriate
so as to prevent dilution or enlargement of rights; provided, that such
adjustments to the limitations imposed by Sections 4.1(e) and 4.6, and to
Qualified Performance-Based Awards shall be carried out in a manner complying
with the requirements for the Section 162(m) Exemption.

SECTION 9. CHANGE OF CONTROL

(a)   In the event of a Change of Control, unless explicitly provided otherwise
      in the applicable Award Agreement:

      (i)   Any Stock Options and Stock Appreciation Rights outstanding as of
            the Date of Change of Control that are not then fully exercisable
            and vested, shall become fully exercisable and vested to the full
            extent of the original grant and shall remain exercisable following
            any Involuntary Termination for a period not less than the lesser of
            one year and the remainder of the original term of such Stock Option
            or Stock Appreciation Right;

      (ii)  All restrictions and other limitations applicable to any Restricted
            Stock shall lapse, and such Restricted Stock shall become free of
            all restrictions and become fully vested and transferable to the
            full extent of the original grant;

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      (iii) All Performance Awards and other Awards outstanding as of the Date
            of Change of Control shall be considered to be earned, at the higher
            of the target level or the level earned based upon performance from
            the beginning of the applicable performance period through the Date
            of Change of Control, and shall be paid in full, and any deferral or
            other restriction shall lapse and except as provided in subsection
            (c) of this Section 9, such Performance Awards shall be settled in
            cash as promptly as is practicable; and (iv) All noncompetition
            covenants and other similar restrictive covenants applicable to any
            outstanding Awards shall lapse and become null and void and of no
            further effect.

(b)   A "Change of Control" shall mean:

      (i)   The acquisition by any individual, entity or group (within the
            meaning of Section 13(d)(3) or 14 (d)(2) of the Exchange Act (a
            "Person")) of beneficial ownership (within the meaning of Rule 13d-3
            promulgated under the Exchange Act) of 15 percent or more of either
            (a) the then outstanding shares of common stock of the Company (the
            "Outstanding Company Common Stock") or (b) the combined power of the
            then outstanding voting securities of the Company entitled to vote
            generally in the election of directors (the "Outstanding Company
            Voting Securities"); provided, however, that for purposes of this
            subsection (i), the following acquisitions shall not constitute a
            Change of Control: (A) any acquisition directly from the Company,
            (B) any acquisition by the Company, (C) any acquisition by any
            employee benefit plan (or related trust) sponsored or maintained by
            the Company or any corporation controlled by the Company or (D) any
            acquisition pursuant to a transaction which complies with clauses
            (A), (B) and (C) of subsection (iii) of this Section 9(b); or

                                      -19-
<PAGE>

      (ii)  Individuals who, as of August 26, 2002, constituted the Board (the
            "Incumbent Board") cease for any reason to constitute at least a
            majority of the Board; provided, however, that any individual
            becoming a director subsequent to August 26, 2002, whose election,
            or nomination for election by the Company's stockholders, was
            approved by a vote of at least a majority of the directors then
            comprising the Incumbent Board shall be considered as though such
            individual were a member of the Incumbent Board, but excluding, for
            this purpose, any such individual whose initial assumption of office
            occurs as a result of an actual or threatened election contest with
            respect to the election or removal of directors or other actual or
            threatened solicitation of proxies or consents by or on behalf of a
            Person other than the Board; or

      (iii) Consummation of a reorganization, merger or consolidation or sale or
            other disposition of all or substantially all of the assets of the
            Company or the acquisition of assets of another entity (a "Corporate
            Transaction"), in each case, unless, following such Corporate
            Transaction, (A) all or substantially all of the individuals and
            entities who were the beneficial owners, respectively, of the
            Outstanding Company Common Stock and Outstanding Company Voting
            Securities immediately prior to such Corporate Transaction
            beneficially own, directly or indirectly, more than 60 percent of,
            respectively, the then outstanding shares of common stock and the
            combined voting power of the then outstanding voting securities
            entitled to vote generally in the election of directors, as the case
            may be, of the corporation resulting from such Corporate Transaction
            (including, without limitation, a corporation which as a result of
            such transaction owns the Company or all or substantially all of the
            Company's assets either directly or through one or more
            subsidiaries) in substantially the same proportions as their
            ownership, immediately prior to such Corporate Transaction of the
            Outstanding Company Common Stock and Outstanding Company

                                      -20-
<PAGE>

            Voting Securities, as the case may be, (B) no Person (excluding any
            employee benefit plan (or related trust) of the Company or such
            corporation resulting from such Corporate Transaction) beneficially
            own, directly or indirectly, 15 percent or more of, respectively,
            the then outstanding shares of common stock of the corporation
            resulting from such Corporate Transaction or the combined voting
            power of the then outstanding voting securities of such corporation
            except to the extent that such ownership existed prior to the
            Corporate Transaction and (C) at least a majority of the members of
            the board of directors of the corporation resulting from such
            Corporate Transaction were members of the Incumbent Board at the
            time of the execution of the initial agreement, or of the action of
            the Board, providing for such Corporate Transaction; or

      (iv)  Approval by the stockholders of the Company of a complete
            liquidation or dissolution of the Company.

(c)   Notwithstanding the foregoing, if any right to receive cash granted
      pursuant to this Section 9 would make a Change of Control transaction
      ineligible for pooling-of-interests accounting under APB No. 16 that but
      for the nature of such right would be eligible for such accounting
      treatment, the Committee shall have the ability to substitute for the cash
      payable pursuant to such right Stock or other securities with a Fair
      Market Value equal to the cash that would otherwise be payable hereunder
      and to make such other adjustments as may be necessary to preserve such
      eligibility (so long as such other adjustments do not materially diminish
      the value of the affected Awards).

SECTION 10. RIGHTS OF EMPLOYEES

(a)   Status as an eligible Employee shall not be construed as a commitment that
      any Award will be made under the Plan to such eligible Employee or to
      eligible Employees generally.

                                      -21-
<PAGE>

(b)   Nothing contained in the Plan (or in any other documents related to this
      Plan or to any Award) shall confer upon any Employee or Participant any
      right to continue in the employ or other service of the Company or
      constitute any contract or limit in any way the right of the Company to
      change such person's compensation or other benefits or to terminate the
      employment of such person with or without cause.

SECTION 11. AWARDS IN FOREIGN COUNTRIES

The Committee shall have the authority to adopt such modifications, procedures
and subplans as may be necessary or desirable to comply with provisions of the
laws of foreign countries in which the Company or its Participating Subsidiaries
may operate to assure the viability of the benefits of Awards made to
Participants employed in such countries and to meet the purpose of this Plan.

SECTION 12. COMPLIANCE WITH APPLICABLE LEGAL REQUIREMENTS

No Stock certificate distributable pursuant to this Plan shall be issued and
delivered unless the issuance of such certificate complies with all applicable
legal requirements including, without limitation, compliance with the provisions
of applicable state securities laws, the Securities Act of 1933, as amended from
time to time, or any successor statute, the Exchange Act and the requirements of
the exchanges on which the Company's Stock may, at the time, be listed.

SECTION 13. AMENDMENT AND TERMINATION

(a)   The Board of Directors may at any time amend, suspend or terminate the
      Plan. The Committee may at any time alter or amend any or all Award
      Agreements under the Plan, but no such alteration or amendment may
      adversely affect the rights of the Participant in question without such
      Participant's consent. However, no such action may, without further

                                      -22-
<PAGE>

      approval of the stockholders of the Company, be effective if such approval
      is required in order that transactions in Company securities under the
      Plan be exempt from the operation of Section 16(b) of the Securities
      Exchange Act of 1934, nor may any such action amend the Plan so as to

      (i)   increase the number of shares of Stock which may be issued under the
            Plan, except as provided for in Section 8; or

      (ii)  materially modify the requirements as to eligibility for
            participation.

(b)   In addition, except for adjustments pursuant to Section 8 hereof, in no
      event may any Stock Option or Stock Appreciation Right granted under this
      Plan be amended to decrease the exercise price thereof, cancelled in
      conjunction with the grant of any new Stock Option or Stock Appreciation
      Right with a lower price, or otherwise be subject to any action that would
      be treated, for accounting purposes, as a repricing of such Stock Option
      or Stock Appreciation Right.

SECTION 14. UNFUNDED PLAN

The Plan shall be unfunded. Neither the Company nor the Board of Directors shall
be required to segregate any assets that may at any time be represented by
Awards made pursuant to the Plan. Neither the Company, the Committee, nor the
Board of Directors shall be deemed to be a trustee of any amounts to be paid
under the Plan.

SECTION 15. LIMITS OF LIABILITY

                                      -23-
<PAGE>

(a)   Any liability of the Company to any Participant with respect to an Award
      shall be based solely upon contractual obligations created by the Plan and
      the Award Agreement.

(b)   Neither the Company nor any member of the Board of Directors or of the
      Committee, nor any other person participating in any determination of any
      question under the Plan, or in the interpretation, administration or
      application of the Plan, shall have any liability to any party for any
      action taken or not taken, in good faith under the Plan.

SECTION 16. DURATION OF THE PLAN

This Plan shall become effective on January 1, 2002, upon the adoption by the
Company's stockholders at the 2001 Annual Meeting, and the Committee shall have
authority to grant Awards hereunder until December 31, 2006, subject to the
ability of the Board of Directors to terminate the Plan as provided in Section
13.

SECTION 17. TERMINATION OF OTHER PLANS

The Omnibus Securities Plan of 1993 ("1993 Plan") shall continue for its
duration or until December 31, 2002, and grants may be made from the 1993 Plan
until it expires by its terms or until shares of Stock are no longer awardable
under the 1993 Plan. Grants other than Incentive Stock Options, Non-qualified
Stock Options, and Stock Appreciation Rights that are made under the 1993 Plan,
following the approval by stockholders of the 2002 Omnibus Securities Plan,
shall not exceed 700,000 shares. All Stock Options granted under the 1993 Plan,
following the approval by stockholders of the 2002 Omnibus Securities Plan,
shall be granted at not less than the Fair Market Value of the Stock on the date
of the grant, and the term of such options shall not exceed ten (10) years.

                                      -24-<PAGE>
                                                                   Exhibit 10.27

                    1998 STOCK AND PERFORMANCE INCENTIVE PLAN
                                OF CONOCOPHILLIPS

               (AS AMENDED AND RESTATED EFFECTIVE AUGUST 30, 2002)

                                    RECITALS

            Conoco Inc. ("Conoco") established the 1998 Stock and Performance
Incentive Plan of Conoco Inc. (the "Plan") effective October 16, 1998. Paragraph
5 specifies the number of shares of Common Stock with respect to which awards
may be granted under the Plan. Paragraph 14 reserves to the Board the right to
amend the Plan. Paragraph 16 provides that in the event of certain transactions,
including a reorganization, the Board is authorized to (a) issue or assume
Awards by means of substitution of new Awards, as appropriate, for previously
issued Awards or an assumption of previously issued Awards as part of such
adjustment or (b) to cancel Awards that are Options or SARs and give the
Participants who are the holders of such Awards notice and opportunity to
exercise for 30 days prior to such cancellation.

            Effective October 8, 2001, Conoco reclassified its Class A Common
Stock and Class B Common Stock into a single class of new common stock ("Common
Stock") by merging Conoco Delaware I, Inc., a wholly owned subsidiary of Conoco
("Merger Sub"), with and into Conoco (the "Merger"), pursuant to an Agreement
and Plan of Merger, dated as of July 17, 2001, between Conoco and Merger Sub. In
connection with the Merger and pursuant to their authority under Paragraph 14,
the Board authorized the amendment and restatement of the Plan to provide for
the issuance of Awards with respect to the new class of Common Stock, effective
October 8, 2001 (the effective time of the Merger). In addition, in connection
with the Merger and effective October 8, 2001, pursuant to its authority under
Paragraph 16, the Board substituted a new Award for each previously issued
outstanding Award. The new Award applied to a number of shares of Common Stock
equal to the total number of shares of Conoco Class A Common Stock and Class B
Common Stock for which the previously issued outstanding Award had not been
exercised, and provides for the same exercise price and the same other terms and
conditions as those applicable under the previously issued outstanding Award.

            On September 21, 2001, the stockholders of Conoco approved a Plan
amendment to increase the number shares of Common Stock available for Awards
under the Plan, which increase was included in October 8, 2001 amendment and
restatement of the Plan.

            On October 30, 2001, the Board of Directors of Conoco approved
certain Stock Award and Plan amendment limitations to the Plan.

            Effective November 18, 2001, Conoco entered into the Agreement and
Plan of Merger by and among Phillips Petroleum Company, Corvette Porsche Corp.,
Porsche Merger Corp., Corvette Merger Corp. and Conoco (the "Phillips Merger
Agreement"), which provides for a series of transactions including the formation
of ConocoPhillips, a Delaware corporation, and the merger of Conoco into and
with a subsidiary of ConocoPhillips (collectively, the "Phillips Merger"). In
connection with and effective upon the closing of the Phillips Merger, the Board
of Directors of Conoco approved the amendment and restatement of the Plan to
reflect the
<PAGE>
transfer of sponsorship to ConocoPhillips, the renaming of the Plan as the "1998
Stock and Performance Incentive Plan of ConocoPhillips," and to make certain
changes related thereto.

            Now, therefore, Conoco hereby amends and restates the Plan,
effective as of the Closing of the Phillips Merger, to read as follows:

      1. Plan. The Plan was adopted by the Company to reward certain corporate
officers and key employees of the Company, certain independent contractors and
nonemployee directors of the Company by providing for certain cash benefits and
by enabling them to acquire shares of Common Stock of the Company.

      2. Objectives. The purpose of this Amended and Restated 1998 Stock and
Performance Incentive Plan of ConocoPhillips is to further the interests of the
Company, its Subsidiaries and its shareholders by providing incentives in the
form of Awards to key employees, independent contractors and directors who can
contribute materially to the success and profitability of the Company and its
Subsidiaries and to provide for issuance of Awards in connection with the
"Option Program" under which certain existing DuPont awards were canceled at the
election of the holders. Such Awards will recognize and reward outstanding
performances and individual contributions and give Participants in the Plan an
interest in the Company parallel to that of the shareholders, thus enhancing the
proprietary and personal interest of such Participants in the Company's
continued success and progress. This Plan will also enable the Company and its
Subsidiaries to attract and retain such employees, independent contractors and
directors.

      3. Definitions. As used herein, the terms set forth below shall have the
following respective meanings:

            "Annual Director Award Date" means, for each year beginning on or
after the IPO Closing Date, the first business day of the month next succeeding
the date upon which the annual meeting of stockholders of the Company is held in
such year.

            "Authorized Officer" means the the Chief Executive Officer of the
Company (or any other senior officer of the Company to whom either of them shall
delegate the authority to execute any Award Agreement, where applicable).

            "Award" means an Employee Award, a Director Award or an Independent
Contractor Award.

            "Award Agreement" means any Employee Award Agreement, Director Award
Agreement or Independent Contractor Award Agreement.

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

            "Cash Award" means an award denominated in cash.

            "Chairman" means the Chairman of the Board as of the IPO Pricing
Date.

            "Change of Control" is defined in Attachment A.

                                       2
<PAGE>
            "Class A Common Stock" means the Class A Common Stock, par value
$.01 per share, of Conoco Inc.

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

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

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

            "Common Stock" means, from and after the effective time of the
Phillips Merger (as defined in the Recitals), ConocoPhillips common stock, par
value $.01 per share. Prior to the effective time of the Phillips Merger and
after the Merger (as defined in the Recitals), "Common Stock" means Conoco
common stock, par value $.01 per share. Prior to the effective time of the
Merger, "Common Stock" means Class A Common Stock or Class B Common Stock, as
appropriate.

            "Company" means ConocoPhillips, a Delaware corporation. Prior to the
effective time of the Phillips Merger, "Company" means Conoco.

            "Conoco" means Conoco Inc., a Delaware corporation.

            "Director Amendment Date" means October 1, 2000, the date as of
which the Plan was amended to reflect a change in the compensation structure for
Nonemployee Directors.

            "Director Award" means a Director Option or Stock Unit.

            "Director Award Agreement" means a written agreement setting forth
the terms, conditions and limitations applicable to a Director Award.

            "Director Option" means a Nonqualified Stock Option granted to a
Nonemployee Director pursuant to paragraph 9 hereof,

            "Directors Deferred Compensation Plan" means the ConocoPhillips
Deferred Compensation Plan for Nonemployee Directors established under the Plan.

            "Disability" means, with respect to a Nonemployee Director, the
inability to perform the duties of a member of the Board for a continuous period
of more than three months by reason of any medically determinable physical or
mental impairment.

            "Dividend Equivalents" means, with respect to shares of Restricted
Stock that are to be issued at the end of the Restriction Period, an amount
equal to all dividends and other distributions (or the economic equivalent
thereof) that are payable to stockholders of record during the Restriction
Period on a like number of shares of Common Stock.

            "DuPont" means E.I. du Pont de Nemours and Company, a Delaware
corporation.

                                       3
<PAGE>
            "DuPont Award" means an option, stock appreciation right or other
form of stock award granted by DuPont pursuant to the DuPont Stock Performance
Plan, the DuPont Variable Compensation Plan, the DuPont Corporate Sharing Plan
or the Conoco Unit Option Plan.

            "Employee" means an employee of the Company or any of its
Subsidiaries and an individual who has agreed to become an employee of the
Company or any of its Subsidiaries and is expected to become such an employee
within the following six months.

            "Employee Award" means any Option, SAR, Stock Award, Cash Award or
Performance Award granted, whether singly, in combination or in tandem, to a
Participant who is an Employee pursuant to such applicable terms, conditions and
limitations (including treatment as a Performance Award) as the Committee may
establish in order to fulfill the objectives of the Plan.

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

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

            "Grant Date" means the date an Award is granted to a Participant
pursuant to the Plan. The Grant Date for a substituted award is the Grant Date
of the original award.

            "Grant Price" means the price at which a Participant may exercise
his or her right to receive cash or Common Stock, as applicable, under the terms
of an Award.

            "Incentive Stock Option" means an Option that is intended to comply
with the requirements set forth in Section 422 of the Code.

            "Independent Contractor" means a person providing services to the
Company or any of its Subsidiaries, or who will provide such services, except an
Employee or Nonemployee Director.

                                       4
<PAGE>
            "Independent Contractor Award" means any Nonqualified Stock Option,
SAR, Stock Award, Cash Award or Performance Award granted, whether singly, in
combination or in tandem, to a Participant who is an Independent Contractor
pursuant to such applicable terms, conditions and limitations as the Committee
may establish in order to fulfill the objectives of the Plan.

            "Independent Contractor Award Agreement" means a written agreement
setting forth the terms, conditions and limitations applicable to an Independent
Contractor Award.

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

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

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

            "Nonemployee Director" means an individual serving as a member of
the Board who is not an Employee of the Company or any of its Subsidiaries.

            "Nonqualified Stock Option" means an Option that is not an Incentive
Stock Option.

            "Option" means a right to purchase a specified number of shares of
Common Stock at a specified Grant Price, which may be an Incentive Stock Option
or a Nonqualified Stock Option.

            "Option Program" means a program involving the cancellation of
certain existing DuPont Awards.

            "Option Program Award" means an Option, SAR or Stock Award granted
in connection with the Option Program.

            "Option Value" means the value of a Director Option as determined on
the basis of a generally accepted valuation methodology as determined by the
Board.

            "Participant" means an Employee, Director or Independent Contractor
to whom an Award has been granted under this Plan.

            "Performance Award" means an award made pursuant to this Plan to a
Participant who is an Employee or Independent Contractor that is subject to the
attainment of one or more Performance Goals.

                                       5
<PAGE>
            "Performance Goal" means a standard established by the Committee, to
determine in whole or in part whether a Performance Award shall be earned.

            "Restricted Stock" means Common Stock that is restricted or subject
to forfeiture provisions.

            "Restriction Period" means a period of time beginning as of the
Grant Date of an Award of Restricted Stock and ending as of the date upon which
the Common Stock subject to such Award is no longer restricted or subject to
forfeiture provisions.

            "Stock Appreciation Right" or "SAR" means a right to receive a
payment, in cash or Common Stock, equal to the excess of the Fair Market Value
or other specified valuation of a specified number of shares of Common Stock on
the date the right is exercised over a specified Grant Price, in each case, as
determined by the Committee.

            "Stock Award" means an Award in the form of shares of Common Stock
or units denominated in shares of Common Stock, including an award of Restricted
Stock.

            "Stock Unit" means a unit equal to one share of Common Stock (as
determined by the Committee) (as adjusted pursuant to Paragraph III.6 of the
Directors Deferred Compensation Plan) granted to a Nonemployee Director.

            "Subsidiary" means (i) in the case of a corporation, any corporation
of which the Company directly or indirectly owns shares representing 50% or more
of the combined voting power of the shares of all classes or series of capital
stock of such corporation which have the right to vote generally on matters
submitted to a vote of the stockholders of such corporation and (ii) in the case
of a partnership or other business entity not organized as a corporation, any
such business entity of which the Company directly or indirectly owns 50% or
more of the voting, capital or profits interests (whether in the form of
partnership interests, membership interests or otherwise).

      4. Eligibility.

            (a) Employees. Employees eligible for the grant of Employee Awards
      under this Plan are those who hold positions of responsibility and whose
      performance, in the judgment of the Committee, can have a significant
      effect on the success of the Company and its Subsidiaries.

            (b) Directors. Members of the Board eligible for the grant of
      Director Awards under this Plan are those who are Nonemployee Directors.

            (c) Independent Contractors. All Independent Contractors are
      eligible for the grant of Independent Contractor Awards under this Plan.

      5. Common Stock Available for Awards.

            (a) Subject to the provisions of paragraph 16 hereof, no Award shall
      be granted if it shall result in the aggregate number of shares of Common
      Stock issued under

                                       6
<PAGE>
      the Plan plus the number of shares of Common Stock covered by or subject
      to Awards then outstanding (after giving effect to the grant of the Award
      in question) to exceed 14,684,765. No more than 4,677,000 shares of Common
      Stock shall be available for Incentive Stock Options. The number of shares
      of Common Stock that are the subject of Awards under this Plan that are
      forfeited or terminated, expire unexercised, are settled in cash in lieu
      of Common Stock or in a manner such that all or some of the shares covered
      by an Award are not issued to a Participant or are exchanged for Awards
      that do not involve Common Stock, shall again immediately become available
      for Awards hereunder. The Committee may from time to time adopt and
      observe such procedures concerning the counting of shares against the Plan
      maximum as it may deem appropriate. The Board and the appropriate officers
      of the Company shall from time to time take whatever actions are necessary
      to file any required documents with governmental authorities, stock
      exchanges and transaction reporting systems to ensure that shares of
      Common Stock are available for issuance pursuant to Awards.

            (b) Option Program Awards and awards assumed under the Plan or
      issued as substitute Awards, each pursuant to paragraph 16(b) of the Plan,
      (i) are not subject to the limitations in paragraph 8(b) and (ii) do not
      count against the limitations on Common Stock available for Awards set
      forth in paragraph 5(a).

      6. Administration.

            (a) This Plan shall be administered by the Committee except as
      otherwise provided herein.

            (b) Subject to the provisions hereof, the Committee shall have full
      and exclusive power and authority to administer this Plan and to take all
      actions that are specifically contemplated hereby or are necessary or
      appropriate in connection with the administration hereof. The Committee
      shall also have full and exclusive power to interpret this Plan and to
      adopt such rules, regulations and guidelines for carrying out this Plan as
      it may deem necessary or proper, all of which powers shall be exercised in
      the best interests of the Company and in keeping with the objectives of
      this Plan. The Committee may, in its discretion, provide for the extension
      of the exercisability of an Employee Award or Independent Contractor
      Award, accelerate the vesting or exercisability of an Employee Award or
      Independent Contractor Award, eliminate or make less restrictive any
      restrictions applicable to an Employee Award or Independent Contractor
      Award, waive any restriction or other provision of this Plan (insofar as
      such provision relates to Employee Awards or to Independent Contractor
      Awards) or an Employee Award or Independent Contractor Award or otherwise
      amend or modify an Employee Award or Independent Contractor Award in any
      manner that is either (i) not adverse to the Participant to whom such
      Employee Award or Independent Contractor Award was granted or (ii)
      consented to by such Participant. The Committee may grant an Award to an
      Employee who it expects to become an employee of the Company or any of its
      Subsidiaries within the following six months, with such Award being
      subject to the individual's actually becoming an employee within such time
      period, and subject to such other terms and conditions as may be
      established by the Committee. The Committee may correct any defect or
      supply any omission or reconcile any inconsistency in this Plan or in

                                       7
<PAGE>
      any Award in the manner and to the extent the Committee deems necessary or
      desirable to further the Plan purposes. Any decision of the Committee in
      the interpretation and administration of this Plan shall lie within its
      sole and absolute discretion and shall be final, conclusive and binding on
      all parties concerned.

            (c) No member of the Committee or officer of the Company to whom the
      Committee has delegated authority in accordance with the provisions of
      paragraph 7 of this Plan shall be liable for anything done or omitted to
      be done by him or her, by any member of the Committee or by any officer of
      the Company in connection with the performance of any duties under this
      Plan, except for his or her own willful misconduct or as expressly
      provided by statute.

      7. Delegation of Authority. The Committee may delegate to the Chief
Executive Officer and to other senior officers of the Company its duties under
this Plan pursuant to such conditions or limitations as the Committee may
establish. The Committee may engage or authorize the engagement of a third party
administrator to carry out administrative functions under the Plan.

      8. Employee and Independent Contractor Awards.

            (a) The Committee shall determine the type or types of Employee
      Awards to be made under this Plan and shall designate from time to time
      the Employees who are to be the recipients of such Awards. Each Employee
      Award shall be embodied in an Employee Award Agreement, which shall
      contain such terms, conditions and limitations as shall be determined by
      the Committee in its sole discretion and, if required by the Committee,
      shall be signed by the Participant to whom the Employee Award is granted
      and by an Authorized Officer for and on behalf of the Company. Employee
      Awards may consist of those listed in this paragraph 8(a) and may be
      granted singly, in combination or in tandem. Employee Awards may also be
      granted in combination or in tandem with, in replacement of, or as
      alternatives to, grants or rights under this Plan or any other employee
      plan of the Company or any of its Subsidiaries, including the plan of any
      acquired entity. An Employee Award may provide for the grant or issuance
      of additional, replacement or alternative Employee Awards upon the
      occurrence of specified events, including the exercise of the original
      Employee Award granted to a Participant. All or part of an Employee Award
      may be subject to conditions established by the Committee, which may
      include, but are not limited to, continuous service with the Company and
      its Subsidiaries, achievement of specific business objectives, increases
      in specified indices, attainment of specified growth rates and other
      comparable measurements of performance. Upon the termination of employment
      by a Participant who is an Employee, any unexercised, deferred, unvested
      or unpaid Employee Awards shall be treated as set forth in the applicable
      Employee Award Agreement.

                  (i) Option. An Employee Award may be in the form of an Option,
            which may be an Incentive Stock Option or a Nonqualified Stock
            Option. The Grant Price of an Option shall be not less than the Fair
            Market Value of the Common Stock subject to such Option on the Grant
            Date. Subject to the foregoing provisions, the terms, conditions and
            limitations applicable to any Options

                                       8
<PAGE>
            awarded to Employees pursuant to this Plan, including the Grant
            Price, the term of the Options and the date or dates upon which they
            become exercisable, shall be determined by the Committee.

                  (ii) Stock Appreciation Rights. An Employee Award may be in
            the form of an SAR. The terms, conditions and limitations applicable
            to any SARs awarded to Employees pursuant to this Plan, including
            the Grant Price, the term of any SARs and the date or dates upon
            which they become exercisable, shall be determined by the Committee.

                  (iii) Stock Award. An Employee Award may be in the form of a
            Stock Award. The terms, conditions and limitations applicable to any
            Stock Awards granted pursuant to this Plan shall be determined by
            the Committee.

                  (iv) Cash Award. An Employee Award may be in the form of a
            Cash Award. The terms, conditions and limitations applicable to any
            Cash Awards granted pursuant to this Plan shall be determined by the
            Committee.

                  (v) Performance Award. Without limiting the type or number of
            Employee Awards that may be made under the other provisions of this
            Plan, an Employee Award may be in the form of a Performance Award. A
            Performance Award shall be paid, vested or otherwise deliverable
            solely on account of the attainment of one or more pre-established,
            objective Performance Goals established by the Committee prior to
            the earlier to occur of (x) 90 days after the commencement of the
            period of service to which the Performance Goal relates and (y) the
            lapse of 25% of the period of service (as scheduled in good faith at
            the time the goal is established), and in any event while the
            outcome is substantially uncertain. A Performance Goal is objective
            if a third party having knowledge of the relevant facts could
            determine whether the goal is met. Such a Performance Goal may be
            based on one or more business criteria that apply to the Employee,
            one or more business units of the Company, or the Company as a
            whole, and may include one or more of the following: increased
            revenue, net income, stock price, market share, earnings per share,
            return on equity, return on assets, decrease in costs, shareholder
            value, net cash flow, total shareholder return, return on capital,
            return on investors' capital, operating income, funds from
            operations, cash flow, cash from operations, after-tax operating
            income, reserve addition, proceeds from dispositions, production
            volumes, refinery runs, net cash flow before financing activities,
            reserve replacement ratio, finding and development costs, refinery
            utilizations and total market value. Unless otherwise stated, such a
            Performance Goal need not be based upon an increase or positive
            result under a particular business criterion and could include, for
            example, maintaining the status quo or limiting economic losses
            (measured, in each case, by reference to specific business
            criteria). In interpreting Plan provisions applicable to Performance
            Goals and Performance Awards, it is the intent of the Plan to
            conform with the standards of Section 162(m) of the Code and
            Treasury Regulationss.1.162-27(e)(2)(i), and the Committee in
            establishing such goals and interpreting the Plan shall be guided by
            such provisions. Prior to the payment of any compensation based on
            the

                                       9
<PAGE>
            achievement of Performance Goals, the Committee must certify in
            writing that applicable Performance Goals and any of the material
            terms thereof were, in fact, satisfied. Subject to the foregoing
            provisions, the terms, conditions and limitations applicable to any
            Performance Awards made pursuant to this Plan shall be determined by
            the Committee.

            (b) Notwithstanding anything to the contrary contained in this Plan
      excluding paragraph 5(b), the following limitations shall apply to any
      Employee Awards made hereunder:

                  (i) no Participant may be granted, during any calendar year,
            Employee Awards consisting of Options or SARs that are exercisable
            for more than 2,338,500 shares of Common Stock;

                  (ii) no Participant may be granted, during any calendar year,
            Stock Awards covering or relating to more than 116,925 shares of
            Common Stock (the limitation set forth in this clause (ii), together
            with the limitation set forth in clause (i) above, being hereinafter
            collectively referred to as the "Stock Based Awards Limitations");
            and

                  (iii) no Participant may be granted Employee Awards consisting
            of cash or in any other form permitted under this Plan (other than
            Employee Awards consisting of options or SARs or Stock Awards) in
            respect of any calendar year having a value determined on the Grant
            Date in excess of $10,000,000.

            (c) Subject to Section 8(e), the Committee shall have the sole
      responsibility and authority to determine the type or types of Independent
      Contractor Awards to be made under this Plan and the terms, conditions and
      limitations applicable to such Awards.

            (d) An Option Program Award is generally subject to the same terms
      and conditions as the canceled DuPont Award.

            (e) Stock Awards, other than those awards which are subject to
      specific grant limitations under the Plan, shall be in lieu of, and have a
      Fair Market Value on the Grant Date equal to, other compensation that the
      Company would otherwise have awarded to the Participant.

      9. Director Awards. Each Nonemployee Director of the Company shall be
granted Director Awards in accordance with this paragraph 9 and subject to the
applicable terms, conditions and limitations set forth in this Plan and the
applicable Director Award Agreements. Notwithstanding anything to the contrary
contained herein, Director Awards shall not be granted in any year in which a
sufficient number of shares of Common Stock are not available to make all such
scheduled Awards under this Plan.

            (a) Initial Director Options. On the IPO Pricing Date, each
      Nonemployee Director, other than the Chairman, and each person who had
      agreed to become a Nonemployee Director in connection with the IPO was
      automatically granted a Director

                                       10
<PAGE>
      Option on that number of shares of Class A Common Stock such that the
      aggregate Option Value was $30,000, and the Chairman was automatically
      awarded a Director Option on that number of shares of Class A Common Stock
      such that the aggregate Option Value was $1,300,000, but in the case of a
      person who was not a Nonemployee Director on such date, subject to that
      person becoming a Nonemployee Director no later than the first regularly
      scheduled meeting of the Board following the IPO Pricing Date.

            (b) Annual Director Options. On each Annual Director Award Date
      before the Director Amendment Date, each Nonemployee Director other than
      the Chairman shall automatically be granted a Director Option with an
      Option Value equal to $30,000.

            (c) Terms of Director Option. Each Director Option shall have a term
      of ten years following the Grant Date. The Grant Price of each share of
      Common Stock subject to a Director Option shall be equal to the Fair
      Market Value of the Common Stock subject to such Option on the Grant Date.
      All Director Options shall be fully vested after 6 months of service as a
      Nonemployee Director. All Director Options shall become exercisable in
      increments of one-third of the total number of shares of Common Stock that
      are subject thereto (rounded up to the nearest whole number) on the first
      and second anniversaries of the Grant Date and of all remaining shares of
      Common Stock that are subject thereto on the third anniversary of the
      Grant Date. Notwithstanding the foregoing exercise schedule, all Director
      Options held by a Nonemployee Director shall immediately become fully
      exercisable if the Nonemployee Director terminates his or her status as a
      member of the Board by reason of the director's death or Disability.

            (d) Director Option Agreements. Any Award of Director Options shall
      be embodied in a Director Award Agreement, which shall contain the terms,
      conditions and limitations set forth above and shall be signed by an
      Authorized Officer for and on behalf of the Company.

            (e) IPO Related Stock Units. On the IPO Pricing Date, each
      Nonemployee Director, other than the Chairman, and each person who had
      agreed to become a Nonemployee Director in connection with the IPO was
      automatically granted that number of Stock Units under the Director's
      Deferred Compensation Plan determined by dividing $95,000 by the Fair
      Market Value of Class A Common Stock on the IPO Pricing Date, and the
      Chairman was automatically granted that number of Stock Units under the
      Director's Deferred Compensation Plan determined by dividing $100,000 by
      the Fair Market Value of Class A Common Stock on the IPO Pricing Date;
      provided, however, that in the case of a person who was not a Nonemployee
      Director on such date, the grant under this subparagraph (e) was subject
      to that person becoming a Nonemployee Director no later than the first
      regularly scheduled meeting of the Board following the IPO Pricing Date.
      Initial Stock Units related to Class A Common Stock. Stock Units granted
      under this paragraph 9(e) cannot be distributed or made available to the
      Nonemployee Director before the expiration of three years from the Grant
      Date, except by reason of death or Disability of the director.

            (f) Other Stock Unit Grants before Director Amendment Date. On the
      date of his or her first appointment or election to the Board, provided
      such appointment or

                                       11
<PAGE>
      election occurs on or after the IPO Closing Date and before the Director
      Amendment Date, a Nonemployee Director shall automatically be granted that
      number of Stock Units determined by dividing $95,000 by the Fair Market
      Value of the applicable Common Stock on the date of election to the Board.
      In addition, on each Annual Director Award Date before the Director
      Amendment Date, each Nonemployee Director other than the Chairman shall
      automatically be granted an additional number of Stock Units determined by
      dividing $20,000 by the Fair Market Value of the applicable Common Stock
      on such date. Stock Units granted under this paragraph 9(f) cannot be
      distributed or made available to the Nonemployee Director before the
      expiration of three years from the Grant Date, except by reason of death
      or Disability of the director.

            (g) Initial Stock Unit Grants On or After Director Amendment Date.
      On the date of his or her first appointment or election to the Board, if
      such appointment or election occurs on or after the Director Amendment
      Date, a Nonemployee Director shall automatically be granted that number of
      Stock Units determined by dividing $100,000 by the Fair Market Value of
      the applicable Common Stock on the date of election to the Board. Stock
      Units granted under this paragraph 9(g): (i) shall become vested with
      respect to one-fifth of the total number of Stock Units subject to the
      initial grant hereunder (rounded up to the nearest whole number) on the
      first through fourth anniversaries of the Grant Date and with respect to
      all remaining Stock Units subject to the initial grant hereunder on the
      fifth anniversary of the Grant Date, subject to the requirement that the
      director remain in the continuous service of the Company as a director
      through the anniversary on which the additional vesting is scheduled to
      occur, provided that all such Stock Units shall immediately vest if the
      director terminates his or her status as a member of the Board by reason
      of the death or Disability of the director, and (ii) cannot be distributed
      or made available to the Nonemployee Director before the expiration of
      five years from the Grant Date, except by reason of death or Disability of
      the director. Notwithstanding the foregoing, no grants shall be made under
      this subparagraph (g) solely as a result of a former Phillips Petroleum
      Company director becoming a Nonemployee Director in connection with the
      Phillips Merger.

            (h) Other Stock Unit Grants On or After Director Amendment Date. On
      each Annual Director Award Date occurring on or after the Director
      Amendment Date, each Nonemployee Director shall automatically be granted a
      number of Stock Units determined by dividing $50,000 by the Fair Market
      Value of the applicable Common Stock on such date. Stock Units granted
      under this paragraph 9(h): (i) are fully vested upon the Grant Date, and
      (ii) cannot be distributed or made available to the Nonemployee Director
      before the expiration of three years from the Grant Date, except by reason
      of death or Disability of the director.

            (i) Terms of Stock Units. Stock Units granted under the foregoing
      provisions of this paragraph 9 shall be accounted for and subject to the
      terms and conditions of the Directors Deferred Compensation Plan,
      including provisions that dividend equivalents shall be accumulated and
      reinvested in additional Stock Units.

            (j) Stock Unit Agreements. Any Award of Stock Units shall be
      embodied in a Director Award Agreement, which shall contain the applicable
      terms and conditions and

                                       12
<PAGE>
      limitations set forth above, and applicable terms and conditions from the
      Directors Deferred Compensation Plan.

            10. Change of Control. Notwithstanding the provisions of paragraphs
      8 and 9 hereof, unless otherwise expressly provided in the applicable
      Award Agreement, in the event of a Change of Control during a
      Participant's employment (or service as a Nonemployee Director or
      Independent Contractor) with the Company or one of its Subsidiaries, (i)
      each Award granted under this Plan to the Participant shall be become
      immediately vested and fully exercisable (regardless of the otherwise
      applicable vesting or exercise schedules or performance goals provided for
      under the Award Agreement) and (ii) if the Award is an Option or SAR,
      shall remain exercisable until the expiration of the term of the Award or,
      if the Participant should die before the expiration of the term of the
      Award, until the earlier of (a) the expiration of the term of the Award or
      (b) two (2) years following the date of the Participant's death.

            11. Payment of Awards.

            (a) General. Payment made to a Participant pursuant to an Award may
      be made in the form of cash or Common Stock, or a combination thereof, and
      may include such restrictions as the Committee shall determine, including,
      in the case of Common Stock, restrictions on transfer and forfeiture
      provisions. If such payment is made in the form of Restricted Stock, the
      applicable Award Agreement relating to such shares shall specify whether
      they are to be issued at the beginning or end of the Restriction Period.
      In the event that shares of Restricted Stock are to be issued at the
      beginning of the Restriction Period, the certificates evidencing such
      shares (to the extent that such shares are so evidenced) shall contain
      appropriate legends and restrictions that describe the terms and
      conditions of the restrictions applicable thereto. In the event that
      shares of Restricted Stock are to be issued at the end of the Restricted
      Period, the right to receive such shares shall be evidenced by book entry
      registration or in such other manner as the Committee may determine.
      Payment of Stock Units awarded to Nonemployee Directors shall be governed
      by the Directors Deferred Compensation Plan.

            (b) Deferral. With the approval of the Committee, amounts payable in
      respect of Awards may be deferred and paid either in the form of
      installments or as a lump-sum payment. The Committee may permit selected
      Participants to elect to defer payments of some or all types of Awards or
      any other compensation otherwise payable by the Company in accordance with
      procedures established by the Committee and may provide that such deferred
      compensation may be payable in shares of Common Stock. Any deferred
      payment pursuant to an Award, whether elected by the Participant or
      specified by the Award Agreement or by the Committee, may be forfeited if
      and to the extent that the Award Agreement so provides.

            (c) Dividends, Earnings and Interest. Rights to dividends or
      Dividend Equivalents may be extended to and made part of any Stock Award,
      subject to such terms, conditions and restrictions as the Committee may
      establish. The Committee may also establish rules and procedures for the
      crediting of interest or other earnings on deferred cash payments and
      Dividend Equivalents for Stock Awards.

                                       13
<PAGE>
            (d) Substitution of Awards. At the discretion of the Committee, a
      Participant who is an Employee or Independent Contractor may be offered an
      election to substitute an Employee Award or Independent Contractor Award
      for another Employee Award or Independent Contractor Award or Employee
      Awards or Independent Contractor Awards of the same or different type..
      Subject to Paragraph 16, the Grant Price of any Option shall not be
      decreased, including by means of issuance of a substitute Award with a
      lower Grant Price.

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

      12. Option Exercise. The Grant Price shall be paid in full at the time of
exercise in cash or, if permitted by the Committee and elected by the optionee,
the optionee may purchase such shares by means of tendering Common Stock or
surrendering another Award, including Restricted Stock, valued at Fair Market
Value on the date of exercise, or any combination thereof. The Committee shall
determine acceptable methods for Participants to tender Common Stock or other
Awards. The Committee may provide for procedures to permit the exercise or
purchase of such Awards by use of the proceeds to be received from the sale of
Common Stock issuable pursuant to an Award. Unless otherwise provided in the
applicable Award Agreement, in the event shares of Restricted Stock are tendered
as consideration for the exercise of an Option, a number of the shares issued
upon the exercise of the Option, equal to the number of shares of Restricted
Stock used as consideration therefor, shall be subject to the same restrictions
as the Restricted Stock so submitted as well as any additional restrictions that
may be imposed by the Committee. The Committee may adopt additional rules and
procedures regarding the exercise of Options from time to time, provided that
such rules and procedures are not inconsistent with the provisions of this
paragraph.

            An optionee desiring to pay the Grant Price of an Option by
tendering Common Stock using the method of attestation may, subject to any such
conditions and in compliance with any such procedures as the Committee may
adopt, do so by attesting to the ownership of Common Stock of the requisite
value in which case the Company shall issue or otherwise deliver to the optionee
upon such exercise a number of shares of Common Stock subject to the Option
equal to the result obtained by dividing (a) the excess of the aggregate Fair
Market Value of the shares of Common Stock subject to the Option for which the
Option (or portion thereof) is being exercised over the Grant Price payable in
respect of such exercise by (b) the Fair Market Value per share of Common Stock
subject to the Option, and the optionee may retain the shares of Common Stock
the ownership of which is attested.

      13. Taxes. The Company or its designated third party administrator shall
have the right to deduct applicable taxes from any Employee Award payment and
withhold, at the time of delivery or vesting of cash or shares of Common Stock
under this Plan, an appropriate amount of cash or number of shares of Common
Stock or a combination thereof for payment of taxes or other amounts required by
law or to take such other action as may be necessary in the opinion of the
Company to satisfy all obligations for withholding of such taxes. The Committee
may also

                                       14
<PAGE>
permit withholding to be satisfied by the transfer to the Company of shares of
Common Stock theretofore owned by the holder of the Employee Award with respect
to which withholding is required. If shares of Common Stock are used to satisfy
tax withholding, such shares shall be valued based on the Fair Market Value when
the tax withholding is required to be made. The Committee may provide for loans,
on either a short term or demand basis, from the Company to a Participant who is
an Employee or Independent Contractor to permit the payment of taxes required by
law.

      14. Amendment, Modification, Suspension or Termination of the Plan. The
Board may amend, modify, suspend or terminate this Plan for the purpose of
meeting or addressing any changes in legal requirements or for any other purpose
permitted by law, except that (i) no amendment or alteration that would
adversely affect the rights of any Participant under any Award previously
granted to such Participant shall be made without the consent of such
Participant and (ii) no amendment or alteration shall be effective prior to its
approval by the stockholders of the Company to the extent such approval is
required by applicable legal requirements. In addition, if an amendment would
(i) materially increase the benefits accruing to Participants under this Plan,
(ii) materially increase the aggregate number of securities that may be issued
under this Plan, or (iii) materially modify the requirements as to eligibility
for participation in this Plan, then to the extent required by applicable law,
or deemed necessary by the Committee, such amendment shall be subject to
shareholder approval.

      15. Assignability. Unless otherwise determined by the Committee and
provided in the Award Agreement, no Award or any other benefit under this Plan
shall be assignable or otherwise transferable except by will, beneficiary
designation or the laws of descent and distribution. In the event that a
beneficiary designation conflicts with an assignment by will, the beneficiary
designation will prevail. The Committee may prescribe and include in applicable
Award Agreements other restrictions on transfer. Any attempted assignment of an
Award or any other benefit under this Plan in violation of this paragraph 15
shall be null and void.

      16. Adjustments.

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

            (b) In the event of any subdivision or consolidation of outstanding
      shares of Common Stock, declaration of a dividend payable in shares of
      Common Stock or other stock split, then (i) the number of shares of Common
      Stock reserved under this Plan, (ii) the number of shares of Common Stock
      covered by outstanding Awards, (iii) the Grant Price or other price in
      respect of such Awards, (iv) the appropriate Fair Market Value and other
      price determinations for such Awards, and (v) the Stock Based Awards
      Limitations

                                       15
<PAGE>
      shall each be proportionately adjusted by the Board as appropriate to
      reflect such transaction. In the event of any other recapitalization or
      capital reorganization of the Company, any consolidation or merger of the
      Company with another corporation or entity, the adoption by the Company of
      any plan of exchange affecting Common Stock or any distribution to holders
      of Common Stock of securities or property (other than normal cash
      dividends or dividends payable in Common Stock), the Board shall make
      appropriate adjustments to (i) the number of shares of Common Stock
      covered by Awards, (ii) the Grant Price or other price in respect of such
      Awards, (iii) the appropriate Fair Market Value and other price
      determinations for such Awards, and (iv) the Stock Based Awards
      Limitations to reflect such transaction; provided that such adjustments
      shall only be such as are necessary to maintain the proportionate interest
      of the holders of the Awards and preserve, without increasing, the value
      of such Awards. In the event of a corporate merger, consolidation,
      acquisition of property or stock, separation, reorganization or
      liquidation, the Board shall be authorized (x) to assume under the Plan
      previously issued compensatory awards, or to substitute new Awards for
      previously issued compensatory awards, including Awards, as part of such
      adjustment or (y) to cancel Awards that are Options or SARs and give the
      Participants who are the holders of such Awards notice and opportunity to
      exercise for 30 days prior to such cancellation.

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

      18. Unfunded Plan. This Plan shall be unfunded. Although bookkeeping
accounts may be established with respect to Participants under this Plan, any
such accounts shall be used merely as a bookkeeping convenience. The Company
shall not be required to segregate any assets for purposes of this Plan or
Awards hereunder, nor shall the Company, the Board or the Committee be deemed to
be a trustee of any benefit to be granted under this Plan. Any liability or
obligation of the Company to any Participant with respect to an Award under this
Plan shall be based solely upon any contractual obligations that may be created
by this Plan and any Award Agreement, and no such liability or obligation of the
Company shall be deemed to be secured by any pledge or other encumbrance on any
property of the Company. Neither the Company nor the Board nor the Committee
shall be required to give any security or bond for the performance of any
obligation that may be created by this Plan.

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

                                       16
<PAGE>
      20. Effectiveness. The Plan, as approved by the Board, was effective as of
October 16, 1998. This Plan was approved by the stockholders of the Company on
October 19, 1998. The amendments to the Plan to permit the grant of Awards
denominated in Class B Common Stock were effective on May 12, 1999 and were
conditioned upon the approval of the stockholders of the Company prior to
December 31, 1999, which approval was obtained on May 12, 1999. The amendment to
Paragraph 12 of the Plan providing for option exercise payment by the
attestation method was effective on October 28, 1999. The amendments to the Plan
reflecting a change in Nonemployee Director compensation were effective on
October 1, 2000. The Plan, as approved by the Board for amendment and
restatement in connection with the Merger (as defined in the Recitals on page 1
of this Plan) was effective October 8, 2001, and the increase of shares
available for Awards included in the October 8, 2001 amendment and restatement
was separately approved by the stockholders of the Company on September 21,
2001. The amendment and restatement of the Plan to add certain Stock Award and
Plan amendment limitations was approved by the Board of Directors on October 30,
2001. This amendment and restatement of the Plan to reflect the Phillips Merger,
was approved by the Board of Directors on August 16, 2002 and is effective as of
the effective time of the Phillips Merger.

                                       17
<PAGE>
                                 ATTACHMENT "A"

                               "CHANGE IN CONTROL"

            The following definitions apply to the Change of Control provision
in paragraph 10 of the foregoing Plan.

            "Affiliate" shall have the meaning ascribed to such term in Rule
12b-2 of the General Rules and Regulations under the Exchange Act, as in effect
on August 30, 2002.

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

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

            (a) such Person or any of such Person's Affiliates and Associates,
      directly or indirectly, is the "beneficial owner" of (as determined
      pursuant to Rule 13d-3 of the General Rules and Regulations under the
      Exchange Act, as in effect on August 30, 2002) such securities or
      otherwise has the right to vote or dispose of such securities, including
      pursuant to any agreement, arrangement or understanding (whether or not in
      writing); provided, however, that a Person shall not be deemed the
      "Beneficial Owner" of, or to "beneficially own," any security under this
      subsection (a) as a result of an agreement, arrangement or understanding
      to vote such security if such agreement, arrangement or understanding: (i)
      arises solely from a revocable proxy or consent given in response to a
      public (i.e., not including a solicitation exempted by Rule 14a-2(b)(2) of
      the General Rules and Regulations under the Exchange Act) proxy or consent
      solicitation made pursuant to, and in accordance with, the applicable
      provisions of the General Rules and Regulations under the Exchange Act and
      (ii) is not then reportable by such Person on Schedule 13D under the
      Exchange Act (or any comparable or successor report);

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

                                       18
<PAGE>
            (c) such Person or any of such Person's Affiliates or Associates (i)
      has any agreement, arrangement or understanding (whether or not in
      writing) with any other Person (or any Affiliate or Associate thereof)
      that beneficially owns such securities for the purpose of acquiring,
      holding, voting (except as set forth in the proviso to subsection (a) of
      this definition) or disposing of such securities or (ii) is a member of a
      group (as that term is used in Rule 13d-5(b) of the General Rules and
      Regulations under the Exchange Act) that includes any other Person that
      beneficially owns such securities;

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

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

            "Board" shall have the meaning set forth in the foregoing Plan.

            "Change of Control" shall mean any of the following occurring on or
after August 30, 2002:

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

            (b) individuals who, as of August 30, 2002, constitute the Board
      (the "Incumbent Board") cease for any reason to constitute at least a
      majority of the Board; provided, however, that any individual becoming a
      director subsequent to August 30, 2002 whose election, or nomination for
      election by the Company's shareholders, was approved by a vote of at least
      a majority of the directors then comprising the Incumbent Board shall be
      considered as though such individual were a member of the Incumbent Board;
      provided, further, that there shall be excluded, for this purpose, any
      such individual whose initial assumption of office occurs as a result of
      any

                                       19
<PAGE>
      actual or threatened election contest that is subject to the provisions of
      Rule 14a-11 of the General Rules and Regulations under the Exchange Act;

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

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

                                       20
<PAGE>
      the Incumbent Board at the time of the initial agreement or initial action
      of the Board providing for such sale or other disposition of assets of the
      Company.

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

            "Company" shall have the meaning set forth in the foregoing Plan.

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

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

            "Exempt Rights" shall mean any rights to purchase shares of Common
Stock or other Voting Stock of the Company if at the time of the issuance
thereof such rights are not separable from such Common Stock or other Voting
Stock (i.e., are not transferable otherwise than in connection with a transfer
of the underlying Common Stock or other Voting Stock), except upon the
occurrence of a contingency, whether such rights exist as of August 30, 2002 or
are thereafter issued by the Company as a dividend on shares of Common Stock or
other Voting Securities or otherwise.

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

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

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

                                       21

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