Sample Business Contracts


1993 Stock and Incentive Plan - Halliburton Co.


                               HALLIBURTON COMPANY

                          1993 STOCK AND INCENTIVE PLAN

                    As Amended and Restated February 12, 2003


                                   I. PURPOSE

The  purpose  of the  Halliburton  Company  1993 Stock and  Incentive  Plan (the
"Plan")  is  to  provide  a  means  whereby  Halliburton   Company,  a  Delaware
corporation  (the "Company"),  and its  Subsidiaries  may attract,  motivate and
retain  highly  competent  employees  and to  provide a means  whereby  selected
employees  can acquire and  maintain  stock  ownership  and receive cash awards,
thereby  strengthening  their concern for the long-term  welfare of the Company.
The Plan is also intended to provide  employees  with  additional  incentive and
reward  opportunities  designed to enhance the profitable  growth of the Company
over the long term.  A further  purpose of the Plan is to allow awards under the
Plan to  Non-employee  Directors  in order to enhance the  Company's  ability to
attract and retain highly qualified  Directors.  Accordingly,  the Plan provides
for granting Incentive Stock Options,  Options which do not constitute Incentive
Stock Options, Stock Appreciation Rights,  Restricted Stock Awards,  Performance
Awards,  Stock Value Equivalent Awards, or any combination of the foregoing,  as
is best suited to the  circumstances of the particular  employee or Non-employee
Director as provided  herein.  The Plan was  established  February 18, 1993, has
been  amended  from time to time  thereafter,  and  effective as of February 12,
2003,  is amended and  restated to remove the  expiration  date of the Plan,  to
rename the Plan and to make certain other changes.

                                II. DEFINITIONS

The  following  definitions  shall be  applicable  throughout  the  Plan  unless
specifically modified by any paragraph:

         (a)      "Award" means, individually or collectively, any Option, Stock
                  Appreciation Right, Restricted Stock Award,  Performance Award
                  or Stock Value Equivalent Award.

         (b)      "Award  Document"  means the relevant award agreement or other
                  document containing the terms and conditions of an Award.

         (c)      "Beneficial  Owners"  shall have the meaning set forth in Rule
                  13d-3 promulgated under the Exchange Act.

         (d)      "Board" means the Board of Directors of Halliburton Company.

         (e)      "Change of Control Value" means, for the purposes of Paragraph
                  (f) of Article XII, the amount  determined in Clause (i), (ii)
                  or  (iii), whichever  is applicable, as  follows: (i)  the per
                  share price  offered to  stockholders of  the  Company in  any
                  merger,   consolidation,  sale   of  assets   or   dissolution
                  transaction, (ii) the  per share price offered to stockholders
                  of the Company in any tender offer or exchange offer whereby a
                  Corporate Change  takes place  or (iii) if  a Corporate Change
                  occurs other than  as described in  Clause (i) or Clause (ii),
                  the fair market value per share determined by the Committee as
                  of the  date determined  by the  Committee to  be the  date of
                  cancellation and  surrender of an Option or Stock Appreciation
                  Right.  If  the consideration offered  to stockholders  of the
                  Company in  any transaction  described in  this Paragraph  (e)
                  consists of  anything  other than  cash, the  Committee  shall
                  determine  the fair  cash  equivalent of  the  portion  of the
                  consideration offered which is other than cash.

         (f)      "Code"  means the Internal  Revenue Code of 1986,  as amended.
                  Reference  in the Plan to any  section  of the  Code  shall be
                  deemed to include any  amendments  or successor  provisions to
                  such section and any regulations under such section.


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         (g)      "Committee"  means  the  committee  selected  by the  Board to
                  administer  the  Plan  in  accordance  with  Paragraph  (a) of
                  Article IV of the Plan.

         (h)      "Common  Stock"  means the Common  Stock,  par value $2.50 per
                  share, of the Company.

         (i)      "Company" means Halliburton Company, a Delaware corporation.

         (j)      "Corporate  Change"  shall  conclusively  be  deemed  to  have
                  occurred on a Corporate  Change Effective Date if an event set
                  forth  in any  one  of the  following  paragraphs  shall  have
                  occurred:

                  (i)         any Person is or  becomes  the  Beneficial  Owner,
                              directly  or  indirectly,  of  securities  of  the
                              Company   (not   including   in   the   securities
                              beneficially  owned by such Person any  securities
                              acquired   directly   from  the   Company  or  its
                              affiliates)   representing  20%  or  more  of  the
                              combined   voting  power  of  the  Company's  then
                              outstanding securities; or

                  (ii)        the following  individuals cease for any reason to
                              constitute  a majority of the number of  directors
                              then serving: individuals who, on the date hereof,
                              constitute  the Board and any new Director  (other
                              than a Director whose initial assumption of office
                              is in  connection  with an  actual  or  threatened
                              election  contest  relating  to  the  election  of
                              Directors of the  Company)  whose  appointment  or
                              election by the Board or  nomination  for election
                              by the  Company's  stockholders  was  approved  or
                              recommended by a vote of at least two-thirds (2/3)
                              of the  Directors  then still in office who either
                              were   Directors  on  the  date  hereof  or  whose
                              appointment,  election or nomination  for election
                              was previously so approved or recommended; or

                  (iii)       there is consummated  a merger or consolidation of
                              the  Company or any direct or indirect  Subsidiary
                              of the Company  with any other  corporation, other
                              than  (A) a merger  or consolidation  which  would
                              result in  the voting  securities  of the  Company
                              outstanding  immediately  prior to  such merger or
                              consolidation continuing to represent  (either  by
                              remaining  outstanding or by  being converted into
                              voting securities of  the surviving entity  or any
                              parent thereof), in combination with the ownership
                              of   any  trustee   or  other  fiduciary   holding
                              securities  under an employee benefit  plan of the
                              Company or any Subsidiary of the Company, at least
                              50% of the combined voting power of the securities
                              of  the Company  or such  surviving entity  or any
                              parent thereof outstanding immediately  after such
                              merger  or  consolidation,  or  (B)  a  merger  or
                              consolidation    effected     to    implement    a
                              recapitalization  of   the  Company   (or  similar
                              transaction) in which no Person is or  becomes the
                              Beneficial  Owner,   directly  or  indirectly,  of
                              securities  of the  Company (not  including in the
                              securities  Beneficially Owned  by such Person any
                              securities acquired directly from  the  Company or
                              any of  its affiliates  other than  in  connection
                              with the acquisition by the Company or  any of its
                              affiliates of a business) representing 20% or more
                              of the combined voting power of the Company's then
                              outstanding securities; or

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                  (iv)        the  stockholders of the Company approve a plan of
                              complete liquidation or dissolution of the Company
                              or there is consummated an agreement for the sale,
                              disposition,  lease or  exchange by the Company of
                              all or substantially  all of the Company's assets,
                              other than a sale, disposition,  lease or exchange
                              by the Company of all or substantially  all of the
                              Company's assets to an entity, at least 50% of the
                              combined voting power of the voting  securities of
                              which are owned by  stockholders of the Company in
                              substantially   the  same   proportions  as  their
                              ownership of the Company immediately prior to such
                              sale.

Notwithstanding the foregoing,  a "Corporate Change" shall not be deemed to have
occurred  by  virtue  of  the  consummation  of any  transaction  or  series  of
integrated  transactions  immediately  following which the record holders of the
Common Stock of the Company  immediately  prior to such transaction or series of
transactions continue to have substantially the same proportionate  ownership in
an entity  which  owns all or  substantially  all of the  assets of the  Company
immediately following such transaction or series of transactions.

         (k)      "Corporate Change Effective Date" shall mean:

                  (i)         the  first  date  that  the  direct  or   indirect
                              ownership of 20% or more combined  voting power of
                              the Company's outstanding  securities results in a
                              Corporate  Change as  described  in clause  (i) of
                              such definition above; or

                  (ii)        the date of the election of Directors that results
                              in a Corporate  Change as described in clause (ii)
                              of such definition; or

                  (iii)       the  date  of the  merger  or  consideration  that
                              results  in a  Corporate  Change as  described  in
                              clause (iii) of such definition; or

                  (iv)        the date of stockholder approval that results in a
                              Corporate  Change as  described  in clause (iv) of
                              such definition.

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

         (m)      "Fair  Market Value"  means, as  of any  specified  date,  the
                  closing  price  of the  Common  Stock on  the New  York  Stock
                  Exchange  (or, if the Common  Stock is not then listed on such
                  exchange,  such   other  national   securities   exchange   on
                  which the Common Stock is then listed) on that date, or  if no
                  prices  are reported on that date,  on the last preceding date
                  on which such prices of the Common Stock  are so reported  or,
                  in  the  sole  discretion of  the  Committee  for purposes  of
                  determining the  Fair Market  Value of the Common Stock at the
                  time  of exercise of an Option or a Stock  Appreciation Right,
                  such  Fair Market  Value shall be the  prevailing price of the
                  Common Stock as of the time of exercise.  If the  Common Stock
                  is  not  then  listed  or  quoted on  any national  securities
                  exchange  but  is  traded  over the  counter  at  the  time  a
                  determination of its  Fair Market Value is required to be made
                  hereunder,  its Fair Market Value shall be  deemed to be equal
                  to the average between the  reported high and low sales prices
                  of Common Stock on the most recent date on which  Common Stock
                  was  publicly  traded. If  the Common  Stock is  not  publicly
                  traded at the time a determination of its value is required to
                  be  made hereunder, the determination of its Fair Market Value
                  shall be  made by  the Committee  in such manner  as it  deems
                  appropriate.

         (n)      "Holder"  means an  employee or  Non-employee  Director of the
                  Company who has been granted an Award.

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         (o)      "Immediate Family" means, with respect to a particular Holder,
                  the Holder's spouse,  parent,  brother,  sister,  children and
                  grandchildren   (including   adopted  and  step  children  and
                  grandchildren).

         (p)      "Incentive Stock Option" means an Option within the meaning of
                  Section 422 of the Code.

         (q)      "Minimum  Criteria"  shall have the meaning given such term in
                  Paragraph (a) of Article IX.

         (r)      "Non-employee Director" means a member of the Board who is not
                  an  employee  or  former   employee  of  the  Company  or  its
                  Subsidiaries.

         (s)      "Option"  means an Award granted under Article VII of the Plan
                  and includes both Incentive  Stock Options to purchase  Common
                  Stock and  Options  which do not  constitute  Incentive  Stock
                  Options to purchase Common Stock.

         (t)      "Option  Agreement"  means a  written  agreement  between  the
                  Company and a Holder with respect to an Option.

         (u)      "Optionee" means a Holder who has been granted an Option.

         (v)      "Parent  Corporation"  shall  have the  meaning  set  forth in
                  Section 424(e) of the Code.

         (w)      "Performance  Award" means an Award granted under Article X of
                  the Plan.

         (x)      "Person"  shall have the meaning  given in Section  3(a)(9) of
                  the Exchange  Act, as modified and used in Sections  13(d) and
                  14(d) thereof, except that such term shall not include (i) the
                  Company  or any of its  Subsidiaries,  (ii) a trustee or other
                  fiduciary holding securities under an employee benefit plan of
                  the  Company or any of its  affiliates,  (iii) an  underwriter
                  temporarily holding securities pursuant to an offering of such
                  securities,   or  (iv)  a  corporation   owned,   directly  or
                  indirectly,   by   the   stockholders   of  the   Company   in
                  substantially the same proportions as their ownership of stock
                  of the Company.

         (y)      "Plan" means the Halliburton  Company 1993 Stock and Incentive
                  Plan.

         (z)      "Restricted  Stock Award" means an Award granted under Article
                  IX of the Plan.

         (aa)     "Restricted  Stock Award Agreement" means a written  agreement
                  between the Company and a Holder with  respect to a Restricted
                  Stock Award.

         (bb)     "Restriction Period" shall have the meaning given such term in
                  Paragraph (a) of Article IX.

         (cc)     "Spread" means, in the case of a Stock Appreciation  Right, an
                  amount  equal to the excess,  if any, of the Fair Market Value
                  of a share of Common Stock on the date such right is exercised
                  over the exercise price of such Stock Appreciation Right.

         (dd)     "Stock  Appreciation  Right"  means  an  Award  granted  under
                  Article VIII of the Plan.

         (ee)     "Stock   Appreciation   Rights   Agreement"  means  a  written
                  agreement  between the Company and a Holder with respect to an
                  Award of Stock Appreciation Rights.

         (ff)     "Stock Value  Equivalent  Award" means an Award  granted under
                  Article XI of the Plan.

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         (gg)     "Subsidiary"   means  a  company   (whether   a   corporation,
                  partnership,  joint  venture or other form of entity) in which
                  the  Company  or a  corporation  in which the  Company  owns a
                  majority  of  the  shares  of  capital   stock,   directly  or
                  indirectly,  owns a greater than 20% equity  interest,  except
                  that with respect to the issuance of Incentive  Stock  Options
                  the term "Subsidiary"  shall have the same meaning as the term
                  "subsidiary  corporation"  as defined in Section 424(f) of the
                  Code.

         (hh)     "Successor  Holder"  shall have the meaning given such term in
                  Paragraph (f) of Article XIV.

                  III. EFFECTIVE DATE AND DURATION OF THE PLAN

The Plan as amended and restated  herein  shall be effective  February 12, 2003,
the date of its  adoption  by the Board,  provided  the Plan is  approved by the
stockholders of the Company within twelve (12) months thereafter and on or prior
to the date of the first  annual  meeting of  stockholders  of the Company  held
thereafter. Notwithstanding any provision of the Plan or in any Option Agreement
or Stock  Appreciation  Rights Agreement,  no Option or Stock Appreciation Right
granted  on or after  February  12,  2003,  shall be  exercisable  prior to such
stockholder approval.  Subject to the provisions of Article XIII, the Plan shall
remain in effect until all Options and Stock  Appreciation  Rights granted under
the Plan  have  been  exercised  or  expired  by  reason  of lapse of time,  all
restrictions   imposed  upon  Restricted   Stock  Awards  have  lapsed  and  all
Performance Awards and Stock Value Equivalent Awards have been satisfied.

                               IV. ADMINISTRATION

(a)      Composition of Committee. The Plan shall be administered by a Committee
         of Directors of the Company which shall be appointed by the Board.

(b)      Powers.  The Committee  shall  have authority,  in its  discretion,  to
         determine  which eligible  individuals shall receive an Award, the time
         or times when  such Award  shall be  made, whether  an Incentive  Stock
         Option,  nonqualified  Option  or Stock  Appreciation  Right  shall  be
         granted, the number of shares of Common Stock which may be issued under
         each  Option, Stock Appreciation  Right and Restricted Stock Award, and
         the value of each Performance Award and  Stock Value  Equivalent Award.
         The Committee shall have the authority, in its discretion, to establish
         the  terms and  conditions  applicable  to any  Award, subject  to  any
         specific limitations  or  provisions  of  the  Plan.  In   making  such
         determinations  the Committee may  take into account  the nature of the
         services  rendered by the respective individuals, their  responsibility
         level,  their present  and  potential  contribution  to  the  Company's
         success and such other factors as the Committee in its discretion shall
         deem relevant.

(c)      Additional Powers.  The Committee  shall have such additional powers as
         are delegated to it by the other provisions of the Plan. Subject to the
         express provisions of the Plan, the Committee is authorized to construe
         the  Plan and the  respective Award  Documents executed  thereunder, to
         prescribe  such rules and  regulations relating to  the Plan as  it may
         deem  advisable to carry  out  the Plan,  and to determine  the  terms,
         restrictions  and  provisions  of  each  Award,  including  such terms,
         restrictions  and provisions  as shall be  requisite  in  the  judgment
         of  the Committee  to cause designated  Options to qualify as Incentive
         Stock  Options, and  to  make  all other  determinations  necessary  or
         advisable  for administering the  Plan.  The Committee  may correct any
         defect  or supply any  omission or reconcile  any inconsistency  in any
         Award Document relating to an Award in the manner and to the extent the
         Committee  shall deem expedient  to carry  the Award  into effect.  The
         determinations  of the  Committee on  the matters  referred to  in this
         Article IV shall be conclusive.

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(d)      Delegation of Authority.  The Committee may delegate some or all of its
         power  to the Chief Executive  Officer of the  Company as the Committee
         deems appropriate;  provided, however,  that (i) the Committee  may not
         delegate  its power with regard to the grant of an Award to  any person
         who is a "covered employee" within the meaning of Section 162(m) of the
         Code  or who, in  the Committee's  judgment, is likely to  be a covered
         employee at any time during the period an Award to such  employee would
         be  outstanding; (ii) the  Committee  may not delegate  its power  with
         regard to  the selection for participation in the Plan of an officer or
         other  person subject  to Section 16 of the  Exchange Act  or decisions
         concerning the timing, pricing or amount of an Award to such an officer
         or  other person  and (iii) any delegation of the power to grant Awards
         shall be permitted by applicable law.

        V. GRANT OF OPTIONS, STOCK APPRECIATION RIGHTS, RESTRICTED STOCK
              AWARDS, PERFORMANCE AWARDS AND STOCK VALUE EQUIVALENT
                       AWARDS; SHARES SUBJECT TO THE PLAN

(a)      Award Limits.  The Committee  may from time to time grant Awards to one
         or more individuals determined by it to  be eligible for  participation
         in  the Plan in  accordance  with  the provisions  of Article  VI.  The
         aggregate number of shares of Common Stock that may be issued under the
         Plan  shall  not  exceed  49,000,000  shares,  of  which  no  more than
         16,000,000 may  be issued in  the form  of Restricted  Stock  Awards or
         pursuant  to Performance  Awards.   Notwithstanding  anything contained
         herein  to  the  contrary,  the  number  of   Option  shares  or  Stock
         Appreciation Rights, singly or in  combination, together with shares or
         share equivalents under Performance Awards granted to any Holder in any
         one calendar year, shall not in the aggregate exceed 500,000.  The cash
         value  determined as of the date  of grant of any Performance Award not
         denominated in Common Stock granted to any Holder  for any one calendar
         year shall not exceed $5,000,000.  Any shares which remain unissued and
         which  are  not  subject  to  outstanding  Options  or  Awards  at  the
         termination  of the Plan  shall cease to be  subject to  the Plan, but,
         until termination of the Plan, the Company shall at all times reserve a
         sufficient  number of  shares to  meet the  requirements  of  the Plan.
         Shares  shall be deemed to  have been issued under the Plan only to the
         extent actually  issued  and  delivered pursuant  to an  Award.  To the
         extent that an Award lapses  or the rights  of its Holder  terminate or
         the  Award is paid in cash, any shares of Common  Stock subject to such
         Award  shall  again  be  available  for  the  grant  of  an Award.  The
         aggregate number of shares which may be issued under the  Plan shall be
         subject  to adjustment  in the  same manner  as provided in Article XII
         with respect  to  shares  of  Common  Stock  subject  to  Options  then
         outstanding.  The  500,000-share  limit  on  Stock  Options  and  Stock
         Appreciation Rights  Awards to  a Holder in  any calendar year shall be
         subject  to adjustment in  the same manner  as provided in Article XII.
         Separate stock certificates  shall be issued  by the  Company for those
         shares  acquired pursuant to  the exercise of an Incentive Stock Option
         and  for those shares  acquired pursuant to  the exercise of any Option
         which does not constitute an Incentive Stock Option.  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.

(b)      Stock  Offered.  The stock to be  offered  pursuant  to the grant of an
         Award may be  authorized  but  unissued  Common  Stock or Common  Stock
         previously issued and reacquired by the Company.

                                 VI. ELIGIBILITY

Awards made pursuant to the Plan may be granted to individuals  who, at the time
of grant,  are employees of the Company or any Parent  Corporation or Subsidiary
of the Company or are Non-employee  Directors. An Award may also be granted to a
person who  has agreed  to become  an employee  of the  Company  or  any  Parent

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Corporation  or  Subsidiary  of  the  Company  within  the  subsequent three (3)
months.  An Award  made  pursuant  to the Plan may be  granted  on more than one
occasion  to the same  person,  and such Award may  include an  Incentive  Stock
Option,  an Option which is not an  Incentive  Stock  Option,  an Award of Stock
Appreciation  Rights,  a Restricted  Stock Award,  a Performance  Award, a Stock
Value Equivalent Award or any combination thereof. Each Award shall be evidenced
in such manner and form as may be prescribed by the Committee.

                               VII. STOCK OPTIONS

(a)      Stock  Option  Agreement.  Each Option  shall be evidenced by an Option
         Agreement between the Company and the Optionee which shall contain such
         terms and conditions as may be approved by the Committee. The terms and
         conditions of the respective  Option  Agreements need not be identical.
         Specifically,  an Option  Agreement  may provide for the payment of the
         option  price,  in whole or in part,  by the  delivery  of a number  of
         shares of Common  Stock (plus cash if  necessary)  having a Fair Market
         Value equal to such option price.

(b)      Option  Period.  The term of each Option  shall be as  specified by the
         Committee at the date of grant;  provided  that, in no case,  shall the
         term of an Option exceed ten (10) years.

(c)      Limitations  on Exercise of Option.  An Option shall be  exercisable in
         whole or in such  installments  and at such times as  determined by the
         Committee.

(d)      Option  Price.  The  purchase  price of Common  Stock issued under each
         Option shall be determined by the  Committee,  but such purchase  price
         shall not be less than the Fair Market Value of Common Stock subject to
         the Option on the date the Option is granted.

(e)      Options and Rights in  Substitution  for Stock Options Granted by Other
         Corporations.  Options  and Stock  Appreciation  Rights  may be granted
         under the Plan from time to time in substitution for stock options held
         by employees  of  corporations  who become,  or who became prior to the
         effective  date  of  the  Plan,  employees  of  the  Company  or of any
         Subsidiary  as a result of a merger or  consolidation  of the employing
         corporation with the Company or such Subsidiary,  or the acquisition by
         the  Company or a  Subsidiary  of all or a portion of the assets of the
         employing  corporation,   or  the  acquisition  by  the  Company  or  a
         Subsidiary of stock of the employing  corporation  with the result that
         such employing corporation becomes a Subsidiary.

(f)      Repricing  Prohibited.  Except for adjustments pursuant to Article XII,
         the purchase price of Common Stock for any  outstanding  Option granted
         under the Plan may not be decreased  after the date of grant nor may an
         outstanding Option granted under the Plan be surrendered to the Company
         as  consideration  for the grant of a new Option with a lower  purchase
         price.  Any other  action  that is deemed to be a  repricing  under any
         applicable rule of the New York Stock Exchange shall be prohibited.

                         VIII. STOCK APPRECIATION RIGHTS

(a)      Stock  Appreciation  Rights. A Stock Appreciation Right is the right to
         receive an amount equal to the Spread with respect to a share of Common
         Stock  upon  the  exercise  of such  Stock  Appreciation  Right.  Stock
         Appreciation  Rights may be granted in connection  with the grant of an
         Option,  in which case the Option  Agreement will provide that exercise
         of Stock Appreciation  Rights will result in the surrender of the right
         to  purchase  the  shares  under  the  Option  as to  which  the  Stock
         Appreciation Rights were exercised.  Alternatively,  Stock Appreciation
         Rights may be granted independently of Options in which case each Award
         of Stock Appreciation Rights shall be evidenced by a Stock Appreciation
         Rights Agreement between the Company and the Holder which shall contain
         such terms and  conditions  as may be  approved by the  Committee.  The


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         terms  and  conditions  of  the respective  Stock  Appreciation  Rights
         Agreements  need not be identical.  The Spread  with respect to a Stock
         Appreciation Right  may be payable  either  in cash, shares  of  Common
         Stock  with a Fair Market Value equal to the Spread or in a combination
         of  cash and  shares of Common  Stock.  Upon the exercise  of any Stock
         Appreciation  Rights granted  hereunder, the  number of shares reserved
         for  issuance under  the Plan shall be reduced  only to the extent that
         shares  of Common  Stock are actually  issued in  connection  with  the
         exercise of such Right.

(b)      Exercise  Price.  The exercise price of each Stock  Appreciation  Right
         shall be determined by the Committee, but such exercise price shall not
         be less than the Fair  Market  Value of a share of Common  Stock on the
         date the Stock Appreciation Right is granted.

(c)      Exercise Period.  The term of each Stock Appreciation Right shall be as
         specified by the Committee at the date of grant;  provided  that, in no
         case,  shall the term of a Stock  Appreciation  Right  exceed  ten (10)
         years.

(d)      Limitations   on  Exercise  of  Stock   Appreciation   Right.  A  Stock
         Appreciation   Right  shall  be   exercisable   in  whole  or  in  such
         installments and at such times as determined by the Committee.

(e)      Repricing  Prohibited.  Except for adjustments pursuant to Article XII,
         the exercise price of a Stock  Appreciation  Right may not be decreased
         after the date of grant nor may an outstanding Stock Appreciation Right
         granted under the Plan be surrendered  to the Company as  consideration
         for the grant of a new Stock  Appreciation  Right with a lower exercise
         price.  Any other  action  that is deemed to be a  repricing  under any
         applicable rule of the New York Stock Exchange shall be prohibited.

                           IX. RESTRICTED STOCK AWARDS

(a)      Restricted  Period To Be Established  by the Committee.  At  the time a
         Restricted Stock Award is made, the  Committee shall establish a period
         of time  (the "Restriction Period") applicable to such Award; provided,
         however, that, except as set forth below and as  permitted by Paragraph
         (b) of this Article IX, such Restriction  Period shall not be less than
         three (3)  years from the  date of grant  (the "Minimum Criteria").  An
         award which provides for the lapse of restrictions on shares applicable
         to  such Award in  equal annual  installments over a period of at least
         three (3) years  from the date  of grant shall  be deemed  to meet  the
         Minimum  Criteria.  The  foregoing  notwithstanding,  with  respect  to
         Restricted Stock  Awards of up to  an aggregate 550,000 shares (subject
         to adjustment as set forth in  Article XII), the Minimum Criteria shall
         not  apply and the  Committee  may establish  such  lesser  Restriction
         Periods  applicable  to  such  Awards  as  it  shall  determine  in its
         discretion.  Subject to the  foregoing, each Restricted Stock Award may
         have  a  different  Restriction  Period,  in  the   discretion  of  the
         Committee. The Restriction Period applicable to a particular Restricted
         Stock  Award shall not  be changed except as permitted by Paragraph (b)
         of this Article or by Article XII.

(b)      Other  Terms  and  Conditions.  Common  Stock  awarded  pursuant  to  a
         Restricted  Stock Award  shall  be represented  by a stock  certificate
         registered in the name of the Holder of such Restricted Stock Award or,
         at the  option of the Company, in the name of a nominee of the Company.
         The  Holder  shall have  the  right to  receive  dividends  during  the
         Restriction Period,  to vote  the Common  Stock subject  thereto and to
         enjoy  all other  stockholder rights,  except that (i) the Holder shall
         not  be entitled  to possession  of the  stock  certificate  until  the
         Restriction  Period  shall have  expired, (ii) the Company shall retain
         custody  of the stock  during the  Restriction Period, (iii) the Holder
         may  not sell,  transfer,  pledge, exchange,  hypothecate  or otherwise
         dispose  of the  stock during the Restriction Period, and (iv) a breach
         of the terms and conditions  established by  the Committee  pursuant to
         the  Restricted Stock  Award shall cause a forfeiture of the Restricted
         Stock Award.  At the time of such Award, the Committee may, in its sole

                                       8
<PAGE>

         discretion,  prescribe  additional  terms,  conditions or  restrictions
         relating to Restricted  Stock  Awards,   including,   but  not  limited
         to,  rules  pertaining to  the  termination  of a Holder's  service (by
         retirement, disability,  death or otherwise) prior to expiration of the
         Restriction  Period as shall be  set forth in a  Restricted Stock Award
         Agreement.

(c)      Payment for  Restricted  Stock.  A Holder shall not be required to make
         any payment for Common Stock  received  pursuant to a Restricted  Stock
         Award,  except to the extent otherwise  required by law and except that
         the Committee  may, in its  discretion,  charge the Holder an amount in
         cash not in  excess of the par  value of the  shares  of  Common  Stock
         issued under the Plan to the Holder.

(d)      Miscellaneous.  Nothing in this Article shall  prohibit the exchange of
         shares  issued  under  the  Plan  (whether  or not  then  subject  to a
         Restricted Stock Award) pursuant to a plan of reorganization  for stock
         or  securities  in the  Company or another  corporation  a party to the
         reorganization, but the stock or securities so received for shares then
         subject to the  restrictions  of a Restricted  Stock Award shall become
         subject to the  restrictions of such Restricted Stock Award. Any shares
         of stock  received as a result of a stock split or stock  dividend with
         respect to shares then subject to a  Restricted  Stock Award shall also
         become subject to the restrictions of the Restricted Stock Award.

                              X. PERFORMANCE AWARDS

(a)      Performance Period. The Committee shall establish,  with respect to and
         at the time of each Performance  Award, a performance period over which
         the performance applicable to the Performance Award of the Holder shall
         be measured.

(b)      Performance  Awards.  Each  Performance  Award may have a maximum value
         established by the Committee at the time of such Award.

(c)      Performance Measures.  A Performance Award  granted under the Plan that
         is  intended to  qualify  as qualified  performance-based  compensation
         under Section  162(m) of the Code  shall be awarded contingent upon the
         achievement  of  one  or  more  performance  measures.  The performance
         criteria  for Performance Awards shall consist of objective tests based
         on the  following: earnings, cash  flow, cash value  added performance,
         stockholder return and/or value, revenues, operating profits (including
         EBITDA), net  profits, earnings  per share, stock price, cost reduction
         goals,  debt to capital  ratio, financial  return ratios, profit return
         and  margins, market  share, working capital and customer satisfaction.
         The  Committee  may  select  one  criterion  or  multiple  criteria for
         measuring   performance.  Performance  criteria  may   be  measured  on
         corporate, subsidiary or business unit performance, or on a combination
         thereof. Further, the performance criteria may be  based on comparative
         performance  with other  companies  or other  external  measure  of the
         selected performance criteria. A Performance Award that is not intended
         to  qualify as  qualified performance-based  compensation under Section
         162(m) of  the Code shall be based on achievement  of such goals and be
         subject to such terms, conditions and  restrictions as the Committee or
         its delegate shall determine.

(d)      Payment.  Following the end of the performance  period, the Holder of a
         Performance  Award shall be  entitled to receive  payment of an amount,
         not exceeding the maximum value of the Performance Award, if any, based
         on the  achievement of the  performance  measures for such  performance
         period, as determined by the Committee in its sole discretion.  Payment
         of a  Performance  Award  (i) may be made in  cash,  Common  Stock or a
         combination  thereof,  as  determined  by the  Committee  in  its  sole
         discretion,  (ii)  shall  be made in a lump sum or in  installments  as
         prescribed  by the Committee in its sole  discretion,  and (iii) to the
         extent  applicable, shall  be based on  the Fair  Market  Value  of the

                                       9
<PAGE>

         Common  Stock on the payment date.  If a payment of cash or issuance of
         Common Stock is to be made on a  deferred  basis, the  Committee  shall
         establish whether interest or  dividend equivalents  shall be  credited
         on the  deferred amounts and any other  terms and conditions applicable
         thereto.

(e)      Termination  of Service.  The Committee  shall  determine the effect of
         termination  of  service  during the  performance  period on a Holder's
         Performance Award.

                        XI. STOCK VALUE EQUIVALENT AWARDS

(a)      Stock Value Equivalent Awards. Stock Value Equivalent Awards are rights
         to receive an amount equal to the Fair Market Value of shares of Common
         Stock or  rights to  receive  an amount  equal to any  appreciation  or
         increase  in the Fair  Market  Value of Common  Stock over a  specified
         period of time,  which vest over a period of time as established by the
         Committee, without payment of any amounts by the Holder thereof (except
         to the  extent  otherwise  required  by  law)  or  satisfaction  of any
         performance  criteria or objectives.  Each Stock Value Equivalent Award
         may have a maximum  value  established  by the Committee at the time of
         such Award.

(b)      Award Period. The Committee shall establish, with respect to and at the
         time of each Stock  Value  Equivalent  Award,  a period  over which the
         Award shall vest with respect to the Holder.

(c)      Payment.  Following the end  of the determined period for a Stock Value
         Equivalent Award, the Holder of a Stock Value Equivalent Award shall be
         entitled to  receive payment  of an  amount, not exceeding  the maximum
         value of  the Stock Value Equivalent  Award, if any, based  on the then
         vested  value of the Award. Payment  of a Stock Value  Equivalent Award
         (i)  shall be  made in cash, (ii) shall  be made  in a  lump sum  or in
         installments  as prescribed by  the Committee in  its sole  discretion,
         and (iii)  shall be based on the Fair  Market Value of the Common Stock
         on the payment  date. Cash dividend equivalents  may be paid during, or
         may be  accumulated and paid at the end  of, the determined period with
         respect  to  a Stock  Value  Equivalent  Award, as  determined  by  the
         Committee.  If payment of cash is  to be made on a  deferred basis, the
         Committee  shall establish whether interest shall be credited, the rate
         thereof and any other terms and conditions applicable thereto.

(d)      Termination  of Service.  The Committee  shall  determine the effect of
         termination  of  service  during  the  applicable  vesting  period on a
         Holder's Stock Value Equivalent Award.

                     XII. RECAPITALIZATION OR REORGANIZATION

(a)      Except  as  hereinafter   otherwise  provided,  in  the  event  of  any
         recapitalization,  reorganization, merger, consolidation,  combination,
         exchange,  stock  dividend,  stock  split,  extraordinary  dividend  or
         divestiture (including a spin-off) or any other change in the corporate
         structure  or shares of Common  Stock  occurring  after the date of the
         grant of an Award,  the Committee  shall, in its discretion,  make such
         adjustment  as to the  number  and price of  shares of Common  Stock or
         other consideration  subject to such Awards as the Committee shall deem
         appropriate  in order to prevent  dilution or  enlargement of rights of
         the Holders.

(b)      The existence of the Plan and the Awards  granted  hereunder  shall not
         affect in any way the  right or power of the Board or the  stockholders
         of the Company to make or authorize any  adjustment,  recapitalization,
         reorganization  or other change in the Company's  capital  structure or
         its business,  any merger or consolidation of the Company, any issue of
         debt or equity  securities  having  any  priority  or  preference  with
         respect  to or  affecting  Common  Stock  or the  rights  thereof,  the
         dissolution or liquidation of the Company or any sale, lease,  exchange
         or other  disposition  of all or any part of its assets or  business or
         any other corporate act or proceeding.

                                       10
<PAGE>

(c)      The  shares with  respect to which Options or Stock Appreciation Rights
         may be granted are shares of Common Stock as presently constituted, but
         if, and  whenever, prior  to the  expiration  of  an  Option  or  Stock
         Appreciation  Rights,  the   Company  shall  effect  a  subdivision  or
         consolidation  of shares  of Common  Stock or  the payment  of a  stock
         dividend  on  Common Stock  without  receipt of  consideration  by  the
         Company,  the number  of shares  of Common  Stock with respect to which
         such Option or Stock  Appreciation Rights  may thereafter  be exercised
         (i)  in the event  of an increase  in the number  of outstanding shares
         shall  be proportionately increased,  and the purchase  price per share
         shall be proportionately reduced, and (ii) in the  event of a reduction
         in  the number of  outstanding shares shall be proportionately reduced,
         and the purchase price per share shall be proportionately increased.

(d)      If  the  Company   recapitalizes  or  otherwise   changes  its  capital
         structure,   thereafter  upon  any  exercise  of  an  Option  or  Stock
         Appreciation Rights theretofore  granted,  the Holder shall be entitled
         to  purchase  or  receive,  as  applicable,  under such Option or Stock
         Appreciation Rights, in lieu of the number of shares of Common Stock as
         to  which  such  Option  or Stock  Appreciation  Rights  shall  then be
         exercisable, the number and class of shares of stock and securities and
         the cash and  other  property  to which  the  Holder  would  have  been
         entitled pursuant to the terms of the  recapitalization if, immediately
         prior to such  recapitalization,  the  Holder  had been the  holder  of
         record of the  number of shares of Common  Stock  then  covered by such
         Option or Stock Appreciation Rights.

(e)      In the event of a Corporate Change,  unless an Award Document otherwise
         provides, as of the Corporate Change Effective Date (i) any outstanding
         Options and Stock  Appreciation  Rights shall become immediately vested
         and fully exercisable, (ii) any restrictions on Restricted Stock Awards
         shall immediately lapse,  (iii) all performance  measures upon which an
         outstanding  Performance  Award is contingent  shall be deemed achieved
         and the Holder shall receive a payment  equal to the maximum  amount of
         the Award he or she would have been  entitled to  receive,  prorated to
         the Corporate  Change  Effective  Date, and (iv) any  outstanding  cash
         Awards  including,  but not limited to, Stock Value  Equivalent  Awards
         shall  immediately  vest and be paid based on the  vested  value of the
         Award.

(f)      In  the relevant  Award Document,  the Committee  may provide  that, no
         later  than  two (2)  business  days  prior  to  any  Corporate  Change
         referenced  in Clause (ii), (iii)  or (iv) of the definition thereof or
         ten (10) business days after any Corporate Change  referenced in Clause
         (i)  of  the  definition  thereof,  the  Committee  may,  in  its  sole
         discretion,  (i) require the  mandatory surrender  to  the  Company  by
         selected  Optionees of  some or all  of the outstanding Options held by
         such  Optionees  (irrespective   of  whether  such   Options  are  then
         exercisable  under the provisions  of the Plan) as of a date (before or
         after  a Corporate  Change) specified by  the Committee, in which event
         the Committee  shall thereupon  cancel such  Options and  pay  to  each
         Optionee  an amount  of cash per  share equal to the excess, if any, of
         the Change of Control Value of the  shares subject to  such Option over
         the exercise price(s) under such  Options for such shares, (ii) require
         the  mandatory surrender  to the Company  by selected Holders  of Stock
         Appreciation   Rights  of   some  or  all  of   the  outstanding  Stock
         Appreciation Rights held by such Holders (irrespective  of whether such
         Stock Appreciation  Rights are then exercisable under the provisions of
         the Plan) as of a date (before or  after a Corporate  Change) specified
         by  the Committee,  in which event the Committee shall thereupon cancel
         such Stock Appreciation Rights and pay to each Holder an amount of cash
         equal to the Spread with respect to such Stock Appreciation Rights with
         the  Fair Market Value of the Common Stock at such time to be deemed to
         be  the  Change  of  Control  Value,  or  (iii) require  the  mandatory
         surrender to the Company by selected Holders of Restricted Stock Awards
         or Performance Awards of some or all of  the outstanding Awards held by
         such  Holder (irrespective of whether  such Awards are vested under the
         provisions  of the  Plan)  as of  a date  (before or  after a Corporate

                                       11
<PAGE>

         Change)  specified  by the  Committee,  in  which  event  the Committee
         shall thereupon  cancel such Awards and pay to each Holder an amount of
         cash equal to the Change of Control  Value of the shares,  if the Award
         is  denominated in Common Stock, or an amount of cash equal to the Fair
         Market  Value of  the Common  Stock at  such time, if the  Award is not
         denominated in Common Stock.

(g)      Except as hereinbefore  expressly provided, the issuance by the Company
         of shares of stock of any class or securities  convertible  into shares
         of stock of any class,  for cash,  property,  labor or  services,  upon
         direct  sale,  upon the  exercise of rights or  warrants  to  subscribe
         therefor,  or upon  conversion of shares or  obligations of the Company
         convertible  into  such  shares  or other  securities,  and in any case
         whether or not for fair value,  shall not affect,  and no adjustment by
         reason  thereof  shall be made with respect to, the number of shares of
         Common  Stock   subject  to  Options  or  Stock   Appreciation   Rights
         theretofore  granted,  the  purchase  price per  share of Common  Stock
         subject to Options or the  calculation  of the Spread  with  respect to
         Stock Appreciation Rights.

                   XIII. AMENDMENT OR TERMINATION OF THE PLAN

The Board in its discretion may terminate the Plan or alter or amend the Plan or
any part  thereof  from  time to time;  provided  that no  change  in any  Award
theretofore  granted  may be made  which  would  impair the rights of the Holder
without the consent of the Holder,  and  provided,  further,  that the Board may
not, without approval of the stockholders,  amend the Plan to effect a "material
revision" of the Plan, where a "material revision" includes,  but is not limited
to, a revision that: (a) materially  increases the benefits accruing to a Holder
under the Plan, (b) materially increases the aggregate number of securities that
may be issued under the Plan, (c)  materially  modifies the  requirements  as to
eligibility  for  participation  in the Plan,  (d)  changes  the types of awards
available  under the Plan or, (e) amends or deletes the provisions  that prevent
the Committee from amending the terms and conditions of an outstanding Option or
Stock Appreciation Rights to alter the exercise price.

                                   XIV. OTHER

(a)      No Right To An Award.  Neither the  adoption of the Plan nor any action
         of the Board or of the Committee shall be deemed to give an employee or
         a  non-employee  Director  any right to be granted  an Option,  a Stock
         Appreciation Right, a right to a Restricted Stock Award or a right to a
         Performance  Award or Stock Value  Equivalent Award or any other rights
         hereunder  except  as may be  evidenced  by an Award or by an Option or
         Stock  Appreciation  Agreement  duly executed on behalf of the Company,
         and  then  only  to the  extent  of and on  the  terms  and  conditions
         expressly set forth  therein.  The Plan shall be unfunded.  The Company
         shall not be required to establish  any special or separate  fund or to
         make any other  segregation of funds or assets to assure the payment of
         any Award.

(b)      No  Employment  Rights  Conferred.  Nothing contained in the Plan or in
         any Award made hereunder shall:

                  (i)         confer upon any employee any right to continuation
                              of  employment with the Company or any Subsidiary;
                              or

                  (ii)        interfere in any way with the right of the Company
                              or  any   Subsidiary  to   terminate  his  or  her
                              employment at any time.

(c)      No Rights to Serve as a Director  Conferred.  Nothing  contained in the
         Plan or in any Award made hereunder  shall confer upon any Director any
         right to continue their position as a Director of the Company.

                                       12
<PAGE>

(d)      Other  Laws; Withholding.  The Company shall not  be obligated to issue
         any Common Stock  pursuant to any Award  granted  under the Plan at any
         time when the offering of the shares covered by such Award has not been
         registered  under the  Securities Act of 1933 and  such other state and
         federal  laws,  rules  or  regulations  as the Company or the Committee
         deems applicable and, in the opinion of  legal counsel for the Company,
         there is no exemption  from the registration requirements of such laws,
         rules  or  regulations  available for  the issuance  and sale  of  such
         shares.  No fractional shares  of Common Stock  shall be delivered, nor
         shall any cash in lieu of fractional shares be paid.  The Company shall
         have  the  right  to  deduct  in  connection  with all Awards any taxes
         required by law to be withheld and to require any payments necessary to
         enable  it to satisfy  its withholding obligations.  The Committee  may
         permit  the Holder of  an Award to elect to surrender, or authorize the
         Company  to withhold,  shares of  Common Stock  (valued at  their  Fair
         Market Value on the date of surrender or withholding of such shares) in
         satisfaction of  the Company's withholding  obligation, subject to such
         restrictions as the Committee deems appropriate.

(e)      No Restriction on Corporate Action. Nothing contained in the Plan shall
         be construed to prevent the Company or any  Subsidiary  from taking any
         corporate  action which is deemed by the Company or such  Subsidiary to
         be  appropriate  or in its best  interest,  whether or not such  action
         would  have an  adverse  effect on the Plan or any Award made under the
         Plan.  No  Holder,  beneficiary  or other  person  shall have any claim
         against the Company or any Subsidiary as a result of any such action.

(f)      Restrictions on Transfer. Except as otherwise provided herein, an Award
         shall  not  be   sold,  transferred,  pledged,  assigned  or  otherwise
         alienated or hypothecated by a Holder other than by will or the laws of
         descent and distribution or pursuant to a "qualified domestic relations
         order"  as defined by  the Code  or Title  I of the Employee Retirement
         Income  Security  Act of  1974, as  amended, and  shall  be exercisable
         during  the lifetime of  the Holder  only by  such Holder, the Holder's
         guardian  or  legal  representative, a  transferee  under  a  qualified
         domestic relations  order or  a  transferee as  described  below.   The
         Committee  may prescribe and  include in the respective Award Documents
         hereunder other restrictions on  transfer.  Any attempted assignment or
         transfer in violation of this  section shall be  null and void.  Upon a
         Holder's death,  the Holder's  personal representative  or other person
         entitled  to succeed  to the  rights  of  the  Holder  (the  "Successor
         Holder") may exercise such rights as are  provided under the applicable
         Award Document.  A Successor Holder must furnish  proof satisfactory to
         the  Company of  his or her  rights to  exercise the  Award  under  the
         Holder's will or under the applicable laws of descent and distribution.
         Notwithstanding the foregoing, the Committee shall have the  authority,
         in its discretion, to grant (or  to sanction by  way of amendment to an
         existing grant) Awards (other  than Incentive Stock  Options) which may
         be transferred by the Holder for no consideration to or for the benefit
         of the Holder's Immediate Family, to a trust solely for  the benefit of
         the  Holder and his  Immediate Family,  or to a  partnership or limited
         liability  company in  which the  Holder and  members  of his Immediate
         Family have  at least  99% of the  equity, profit and loss interest, in
         which case the Award Document shall  so state.  A  transfer of an Award
         pursuant to  this Paragraph  (f) shall be  subject  to such  rules  and
         procedures  as the Committee  may  establish.  In the event an Award is
         transferred  as contemplated in this Paragraph (f), such  Award may not
         be subsequently  transferred by the  transferee except  by will  or the
         laws of descent and distribution, and  such Award shall continue  to be
         governed  by and subject  to the terms and  limitations of the Plan and
         the relevant written instrument for the Award  and the transferee shall
         be entitled  to the same  rights as  the Holder under  Articles XII and
         XIII hereof  as if no transfer  had taken  place.  No transfer shall be
         effective unless  and until written notice of such transfer is provided
         to  the Committee, in  the form and manner prescribed by the Committee.
         The  consequences of  termination  of employment  shall continue  to be
         applied with respect to the original Holder, following which the Awards
         shall  be exercised by the  transferee only to  the extent  and for the
         periods specified in the Plan and the related Award Document.

                                       13
<PAGE>

         The Option Agreement,  Stock Appreciation Rights Agreement,  Restricted
         Stock Agreement or other Award Document shall specify the effect of the
         death of the Holder on the Award.

(g)      Governing Law. This Plan shall be construed in accordance with the laws
         of the State of Texas,  except to the extent that it implicates matters
         which are the  subject of the General  Corporation  Law of the State of
         Delaware which matters shall be governed by the latter law.

(h)      Foreign  Awardees.  Without  amending the Plan, the Committee may grant
         Awards to eligible persons who are foreign  nationals on such terms and
         conditions  different  from those  specified in the Plan as may, in the
         judgment of the  Committee,  be  necessary  or  desirable to foster and
         promote  achievement of the purposes of the Plan and, in furtherance of
         such purposes,  the Committee may make such modifications,  amendments,
         procedures,  subplans  and the like as may be necessary or advisable to
         comply with the provisions of laws and  regulations in other  countries
         or jurisdictions in which the Company or its Subsidiaries operate.

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