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                                                                    EXHIBIT 10-T

                       VERITAS DGC INC. 2001 KEY EMPLOYEE
                              RESTRICTED STOCK PLAN


                                    ARTICLE I

                                PURPOSE AND TERM

The purpose of the Plan is to foster and promote the long-term financial success
of Veritas DGC Inc. (the "Company") and its Subsidiaries and to increase
stockholder value by: (a) encouraging the commitment of selected key Employees,
(b) motivating superior performance of such Employees by means of long-term
performance related incentives, (c) encouraging and providing such Employees
with a program for obtaining ownership interests in the Company which link and
align their personal interests to those of the Company's stockholders, (d)
attracting and retaining key Employees by providing competitive incentive
compensation opportunities, and (e) enabling key Employees to share in the
long-term growth and success of the Company.

The Plan shall become effective as of February 1, 2001 (the "Effective Date").
The Plan shall commence on the Effective Date, and shall remain in effect,
subject to the right of the Board to amend or terminate the Plan at any time
pursuant to Section 8.5, until all Shares subject to the Plan have been
purchased or acquired according to its provisions. No Incentive Awards shall be
granted under the Plan after the expiration of ten (10) years from the Effective
Date.


                                   ARTICLE II

                                   DEFINITIONS

The words and phrases defined in this Article shall have the meaning set out in
Schedule A attached hereto, unless the context in which any such word or phrase
appears reasonably requires a broader, narrower or different meaning.


                                   ARTICLE III

                           ADMINISTRATION OF THE PLAN

3.1      AUTHORITY OF THE COMMITTEE. Except as may be limited by law and subject
         to the provisions herein, the Committee shall have full power to (i)
         select Grantees who shall participate in the Plan; (ii) determine the
         sizes, duration and types of Incentive Awards; (iii) determine the
         terms and conditions of Incentive Awards and Restricted Stock
         Agreements; (iv) determine whether any Shares subject to Incentive
         Awards will be subject to any restrictions on transfer; (v) construe
         and interpret the Plan and any Restricted Stock Agreement or other
         agreement entered into under the Plan; and



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         (vi) establish, amend, or waive rules for the Plan's administration.
         Further, the Committee shall make all other determinations which may be
         necessary or advisable for the administration of the Plan.

3.2      MEETINGS. The Committee shall designate a chairman from among its
         members who shall preside at all of its meetings, and shall designate a
         secretary, without regard to whether that person is a member of the
         Committee, who shall keep the minutes of the proceedings and all
         records, documents, and data pertaining to its administration of the
         Plan. Meetings shall be held at such times and places as shall be
         determined by the Committee and the Committee may hold telephonic
         meetings. The Committee may take any action otherwise proper under the
         Plan by the affirmative vote, taken with or without a meeting, of a
         majority of its members. The Committee may authorize any one or more of
         their members or any officer of the Company to execute and deliver
         documents on behalf of the Committee.

3.3      DECISIONS BINDING. All determinations and decisions made by the
         Committee shall be made in its discretion pursuant to the provisions of
         the Plan, and shall be final, conclusive and binding on all persons
         including the Company, its shareholders, Employees, Grantees, and their
         estates and beneficiaries. The Committee's decisions and determinations
         with respect to any Incentive Award need not be uniform and may be made
         selectively among Incentive Awards and Grantees, whether or not such
         Incentive Awards are similar or such Grantees are similarly situated.

3.4      MODIFICATION OF OUTSTANDING INCENTIVE AWARDS. Subject to any required
         stockholder approval requirements, if applicable, the Committee may, in
         its discretion, provide for the extension of the exercisability of an
         Incentive Award, accelerate the vesting or exercisability of an
         Incentive Award, eliminate or make less restrictive any restrictions
         contained in an Incentive Award, waive any restriction or other
         provisions of an Incentive Award, or otherwise amend or modify an
         Incentive Award in any manner that is either (i) not adverse to the
         Grantee to whom such Incentive Award was granted, or (ii) consented to
         by such Grantee.

3.5      DELEGATION OF AUTHORITY. The Committee may delegate to any Authorized
         Officer certain of its duties under the Plan pursuant to such
         conditions or limitations as the Committee may establish from time to
         time.

3.6      EXPENSES OF COMMITTEE. The Committee may employ legal counsel,
         including, without limitation, independent legal counsel and counsel
         regularly employed by the Company, and other agents as the Committee
         may deem appropriate for the administration of the Plan. The Committee
         may rely upon any opinion or computation received from any such counsel
         or agent. All expenses incurred by the Committee in interpreting and
         administering the Plan, including, without limitation, meeting expenses
         and professional fees, shall be paid by the Company.

3.7      SURRENDER OF PREVIOUS INCENTIVE AWARDS. The Committee may, in its
         absolute discretion, grant Incentive Awards to Grantees



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         on the condition that such Grantees surrender to the Committee for
         cancellation such other Incentive Awards as the Committee directs.
         Incentive Awards granted on the condition precedent of surrender of
         outstanding Incentive Awards shall not count against the limits set
         forth in Section 4.1 until such time as such previous Incentive Awards
         are surrendered and canceled.

3.8      INDEMNIFICATION. Each person who is or was a member of the Committee
         shall be indemnified by the Company against and from any damage, loss,
         liability, cost and expense that may be imposed upon or reasonably
         incurred by him in connection with or resulting from any claim, action,
         suit, or proceeding to which he may be a party or in which he may be
         involved by reason of any action taken or failure to act under the
         Plan, except for any such act or omission constituting willful
         misconduct or gross negligence. Such person shall be indemnified by the
         Company for all amounts paid by him in settlement thereof, with the
         Company's approval, or paid by him in satisfaction of any judgment in
         any such action, suit, or proceeding against him, provided he shall
         give the Company an opportunity, at its own expense, to handle and
         defend the same before he undertakes to handle and defend it on his own
         behalf. The foregoing right of indemnification shall not be exclusive
         of any other rights of indemnification to which such persons may be
         entitled under the Company's Articles of Incorporation or Bylaws, as a
         matter of law, or otherwise, or any power that the Company may have to
         indemnify them or hold them harmless.


                                   ARTICLE IV

                                PURPOSE AND TERM

4.1      SHARES OF COMMON STOCK AVAILABLE FOR INCENTIVE AWARDS.

         Subject to adjustment under Section 7.5, there shall be available for
         Incentive Awards under the Plan an aggregate of 200,000 Shares of
         Common Stock. The number of Shares of Common Stock subject to Incentive
         Awards that are forfeited or terminated, or are settled in a manner
         such that all or some of the Shares covered by the Incentive Award are
         not issued to a Grantee, shall again immediately become available for
         Incentive Awards hereunder. The Common Stock available for issuance or
         transfer under the Plan shall be made available from Shares now or
         hereafter (a) held in the treasury of the Company, (b) authorized but
         unissued Shares or (c) Shares to be purchased or acquired by the
         Company. No fractional Shares shall be issued under the Plan.


                                    ARTICLE V

                                   ELIGIBILITY

The individuals who shall be eligible to receive Incentive Awards shall be those
Employees who are not officers (as defined by the Securities and Exchange
Commission in Rule 16a-1(f) under the Exchange Act, or any successor rule) or
directors of the Company, who have substantial



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responsibility for the management and growth of the Company or any of its
Subsidiaries as the Committee shall determine from time to time.


                                   ARTICLE VI

                             RESTRICTED STOCK AWARDS

6.1      GRANT. In consideration for services by the Grantee, Shares of
         Restricted Stock may be awarded under the Plan by the Committee with
         such restrictions during the Restriction Period as the Committee
         designates in its discretion, any of which restrictions may differ with
         respect to a particular Grantee. Restricted Stock shall be awarded for
         no additional consideration or such additional consideration as the
         Committee may determine, which consideration may be less than, equal to
         or more than the Fair Market Value of the Shares of Restricted Stock on
         the date of grant. The terms and conditions of each grant of Restricted
         Stock shall be evidenced by a Restricted Stock Agreement.

6.2      IMMEDIATE TRANSFER WITHOUT IMMEDIATE DELIVERY OF RESTRICTED STOCK.
         Unless otherwise specified in the Grantee's Restricted Stock Agreement,
         each Incentive Award shall constitute an immediate transfer of the
         record and beneficial ownership of the Shares of Restricted Stock to
         the Grantee in consideration of the performance of services as an
         Employee, entitling such Grantee to all voting and other ownership
         rights in such Shares subject to any restrictions thereon.

         As specified in the Restricted Stock Agreement, an Incentive Award may
         limit the Grantee's dividend rights during the Restriction Period in
         which the Shares of Restricted Stock are subject to a "substantial risk
         of forfeiture" (within the meaning given to such term under Code
         Section 83) and restrictions on transfer. In the Restricted Stock
         Agreement, the Committee may apply any restrictions to the dividends
         that the Committee deems appropriate.

         As determined by the Committee, Shares awarded pursuant to a grant of
         Restricted Stock may be issued in the name of the Grantee and held,
         together with a stock power endorsed by the Grantee in blank, by the
         Committee or the Secretary of the Company (or their delegates) as a
         depository for safekeeping until such time as the forfeiture
         restrictions and restrictions on transfer have lapsed. All such terms
         and conditions shall be set forth in the particular Grantee's
         Restricted Stock Agreement. The Company or Committee shall issue to the
         Grantee a receipt evidencing the certificates held by it which are
         registered in the name of the Grantee.

6.3      RESTRICTIONS

         (a)      Forfeiture of Restricted Stock. Restricted Stock awarded to a
                  Grantee may be subject to the following restrictions until the
                  expiration of the Restriction Period:

                  (i)      a restriction that constitutes a "substantial risk of
                           forfeiture" (as defined in



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                           Code Section 83), or a restriction on transferability
                           under Code Section 83; and

                  (ii)     any other restrictions that the Committee determines
                           are appropriate, including, without limitation,
                           rights of repurchase or first refusal in the Company
                           or provisions subjecting the Restricted Stock to a
                           continuing substantial risk of forfeiture in the
                           hands of any transferee. Any such restrictions shall
                           be set forth in the particular Grantee's Restricted
                           Stock Agreement.

         (b)      Issuance of Certificates. Coincident with or promptly after
                  the grant date with respect to Shares of Restricted Stock, the
                  Company shall cause to be issued a stock certificate,
                  registered in the name of the Grantee to whom such Restricted
                  Stock was granted, evidencing such Shares; provided, however,
                  that the Company shall not cause to be issued such a stock
                  certificate unless it has received a stock power duly endorsed
                  in blank by the Grantee with respect to such Shares. Each such
                  stock certificate shall bear the following legend or any other
                  legend approved by the Company:

         THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK
         REPRESENTED HEREBY ARE SUBJECT TO THE RESTRICTIONS, TERMS AND
         CONDITIONS (INCLUDING FORFEITURE AND RESTRICTIONS AGAINST TRANSFER)
         CONTAINED IN THE VERITAS DGC INC. RESTRICTED STOCK PLAN AND A
         RESTRICTED STOCK AGREEMENT DATED _______________, ____ BETWEEN THE
         REGISTERED OWNER OF SUCH SHARES AND VERITAS DGC INC. RESTRICTIONS ON
         THE RIGHT TO OWN OR TRANSFER THE SHARES OF STOCK REPRESENTED BY THIS
         CERTIFICATE HAVE BEEN IMPOSED PURSUANT TO SAID RESTRICTED STOCK
         AGREEMENT. A COPY OF THE RESTRICTED STOCK AGREEMENT IS ON FILE AT THE
         PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED WITHOUT CHARGE TO
         THE HOLDER OF THIS CERTIFICATE UPON RECEIPT BY THE COMPANY AT ITS
         PRINCIPAL PLACE OF BUSINESS OR REGISTERED OFFICE OF A WRITTEN REQUEST
         FROM THE HOLDER REQUESTING SUCH COPY.

         Such legend shall not be removed from the certificate evidencing such
         Shares of Restricted Stock until such Shares vest pursuant to the terms
         of the Restricted Stock Agreement.

         (c)      Removal of Restrictions. The Committee, in its discretion,
                  shall have the authority to remove any or all of the
                  restrictions on the Restricted Stock if it determines that, by
                  reason of a change in applicable law or another change in
                  circumstance arising after the grant date of the Restricted
                  Stock, such action is appropriate.



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6.4      DELIVERY OF SHARES OF COMMON STOCK.

         Subject to withholding taxes under Section 8.2 and to the terms of the
         Restricted Stock Agreement, a stock certificate evidencing the Shares
         of Restricted Stock with respect to which the restrictions in the
         Restricted Stock Agreement have lapsed or otherwise been satisfied
         shall be delivered to the Grantee or other appropriate recipient free
         of restrictions. Such delivery shall be effected for all purposes when
         the Company shall have deposited such certificate in the United States
         mail, addressed to the Grantee or other appropriate recipient.

6.5      SUPPLEMENTAL PAYMENT ON VESTING OF RESTRICTED STOCK.

         The Grantee shall be responsible for the payment of any federal, state
         or other income taxes due in connection with the Grant, whether such
         taxes are due at the time the Incentive Award is granted or otherwise.


                                   ARTICLE VII

                    PROVISIONS RELATING TO PLAN PARTICIPATION

7.1      PLAN CONDITIONS.

         (a)      Restricted Stock Agreement. Each Grantee to whom an Incentive
                  Award is granted shall be required to enter into a Restricted
                  Stock Agreement with the Company, in such a form as is
                  provided by the Committee. The Restricted Stock Agreement
                  shall contain specific terms as determined by the Committee,
                  in its discretion, with respect to the Grantee's particular
                  Incentive Award. Such terms need not be uniform among all
                  Grantees or any similarly-situated Grantees. The Restricted
                  Stock Agreement may include, without limitation, vesting,
                  forfeiture and other provisions particular to the particular
                  Grantee's Incentive Award, as well as, for example, provisions
                  to the effect that the Grantee (i) shall not disclose any
                  confidential information acquired during Employment with the
                  Company, (ii) shall abide by all the terms and conditions of
                  the Plan and such other terms and conditions as may be imposed
                  by the Committee, (iii) shall not interfere with the
                  employment or other service of any employee, (iv) shall not
                  compete with the Company or become involved in a conflict of
                  interest with the interests of the Company, (v) shall forfeit
                  an Incentive Award if terminated for Cause, (vi) shall not be
                  permitted to make an election under Section 83(b) of the Code
                  when applicable, and (vii) shall be subject to any other
                  agreement between the Grantee and the Company regarding Shares
                  that may be acquired under an Incentive Award including,
                  without limitation, an agreement restricting the
                  transferability of Shares by Grantee. A Restricted Stock
                  Agreement shall include such terms and conditions as are
                  determined by the Committee, in its discretion, to be
                  appropriate with respect to any individual Grantee. The
                  Restricted Stock Agreement shall be signed by the Grantee to
                  whom the Incentive Award is made and by an Authorized Officer.



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         (b)      No Right to Employment. Nothing in the Plan or any instrument
                  executed pursuant to the Plan shall create any employment
                  rights (including without limitation, rights to continued
                  employment) in any Grantee or affect the right of the Company
                  or a Subsidiary to terminate the employment of any Grantee at
                  any time without regard to the existence of the Plan.

         (c)      Securities Requirements. The Company shall be under no
                  obligation to effect the registration pursuant to the
                  Securities Act of 1933 of any Shares of Common Stock to be
                  issued hereunder or to effect similar compliance under any
                  state laws. Notwithstanding anything herein to the contrary,
                  the Company shall not be obligated to cause to be issued or
                  delivered any certificates evidencing Shares pursuant to the
                  Plan unless and until the Company is advised by its legal
                  counsel that the issuance and delivery of such certificates is
                  in compliance with all applicable laws, regulations of
                  governmental authorities, and the requirements of any
                  securities exchange on which Shares are traded. The Committee
                  may require, as a condition of the issuance and delivery of
                  certificates evidencing Shares pursuant to the terms hereof,
                  that the recipient of such Shares make such covenants,
                  agreements and representations, and that such certificates
                  bear such legends, as the Committee, in its discretion, deems
                  to be necessary or desirable.

7.2      TRANSFERABILITY.

         (a)      Non-Transferable Awards. No Incentive Award and no right under
                  the Plan, contingent or otherwise, will be (i) assignable,
                  saleable, or otherwise transferable by a Grantee except by
                  will or by the laws of descent and distribution, or (ii)
                  subject to any encumbrance, pledge, lien, assignment or charge
                  of any nature.

                  No transfer by will or by the laws of descent and distribution
                  shall be effective to bind the Company unless the Committee
                  has been furnished with a copy of the deceased Grantee's
                  enforceable will or such other evidence as the Committee deems
                  necessary to establish the validity of the transfer. Any
                  attempted transfer in violation of this Section 7.2(a) shall
                  be void and ineffective.

         (b)      Ability to Exercise Rights. Subject to a valid beneficiary
                  designation pursuant to Section 8.4, only the Grantee (or his
                  legal guardian in the event of Grantee's Disability), or in
                  the event of his death, his estate, may assume any rights of
                  the Grantee hereunder.

7.3      RIGHTS AS A STOCKHOLDER.

         (a)      Stockholder Rights. Except as otherwise provided in his
                  Restricted Stock Agreement for the grant of Restricted Stock,
                  the Grantee (or a permitted transferee of such Grantee) shall
                  have voting and other rights as a stockholder with respect to
                  such Shares of Restricted Stock prior to the lapse of any
                  restrictions thereon.



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         (b)      Representation of Ownership. In the case of the exercise of an
                  Incentive Award by a person or estate acquiring the right to
                  exercise such Incentive Award by reason of the death or
                  Disability of a Grantee, the Committee may require evidence as
                  to the ownership of such Incentive Award, or the authority of
                  such person, and may require such consents and releases of
                  taxing authorities as the Committee deems advisable.

7.4      LISTING AND REGISTRATION OF SHARES OF COMMON STOCK.

         The exercise of any Incentive Award granted hereunder shall only be
         effective at such time as legal counsel to the Company shall have
         determined that the issuance and delivery of Shares of Common Stock
         pursuant to such exercise is in compliance with all applicable laws,
         regulations of governmental authorities and the requirements of any
         securities exchange on which Shares are traded. The Committee may, in
         its discretion, defer the effectiveness of any exercise of an Incentive
         Award in order to allow the issuance of Shares to be made pursuant to
         registration or an exemption from registration or other methods for
         compliance available under federal or state securities laws. The
         Committee shall inform the Grantee in writing of its decision to defer
         the effectiveness of the exercise of an Incentive Award. During the
         period that the effectiveness of an Incentive Award has been deferred,
         the Grantee may, by written notice to the Committee, withdraw such
         exercise and obtain the refund of any amount paid with respect thereto.

7.5      CHANGE IN STOCK AND ADJUSTMENTS.

         (a)      Changes in Law or Circumstances. Subject to Section 7.7 (which
                  only applies in the event of a Change in Control), in the
                  event of any change in applicable laws or any change in
                  circumstances which results in or would result in any dilution
                  of the rights granted under the Plan, or which otherwise
                  warrants equitable adjustment because it interferes with the
                  intended operation of the Plan, then, if the Committee should
                  determine, in its absolute discretion, that such change
                  equitably requires an adjustment in the number or kind of
                  shares of stock or other securities or property theretofore
                  subject, or which may become subject, to issuance or transfer
                  under the Plan or in the terms and conditions of outstanding
                  Incentive Awards, such adjustment shall be made in accordance
                  with such determination. Such adjustments may include changes
                  with respect to (i) the aggregate number of Shares that may be
                  issued under the Plan, (ii) the number of Shares subject to
                  Incentive Awards, and (iii) the price per Share for
                  outstanding Incentive Awards.

         (b)      Exercise of Corporate Powers. The existence of the Plan or
                  outstanding Incentive Awards hereunder shall not affect in any
                  way the right or power of the Company or its stockholders to
                  make or authorize any or all adjustments, recapitalization,
                  reorganization or other changes in the Company's capital
                  structure or its business or any merger or consolidation of
                  the Company, or any issue of bonds, debentures, preferred or
                  prior preference stocks ahead of or affecting the Common



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                  Stock or the rights thereof, or the dissolution or liquidation
                  of the Company, or any sale or transfer of all or any part of
                  its assets or business, or any other corporate act or
                  proceeding whether of a similar character or otherwise.

         (c)      Recapitalization of the Company. Subject to Section 7.7, if
                  while there are Incentive Awards outstanding, the Company
                  shall effect any subdivision or consolidation of Shares of
                  Common Stock or other capital readjustment, the payment of a
                  stock dividend, stock split, combination of Shares,
                  recapitalization or other increase or reduction in the number
                  of Shares outstanding, without receiving compensation therefor
                  in money, services or property, then the number of Shares
                  available under the Plan and the number of Incentive Awards
                  which may thereafter be exercised shall (i) in the event of an
                  increase in the number of Shares outstanding, be
                  proportionately increased and the price per share of the
                  Incentive Awards awarded shall be proportionately reduced; and
                  (ii) in the event of a reduction in the number of Shares
                  outstanding, be proportionately reduced, and the price per
                  share of the Incentive Awards awarded shall be proportionately
                  increased. The Committee shall take such action and whatever
                  other action it deems appropriate, in its discretion, so that
                  the value of each outstanding Incentive Award to the Grantee
                  shall not be adversely affected by a corporate event described
                  in this subsection (c).

         (d)      Reorganization of the Company. Subject to Section 7.7, if the
                  Company is reorganized, merged or consolidated, or is a party
                  to a plan of exchange with another corporation, pursuant to
                  which reorganization, merger, consolidation or exchange,
                  stockholders of the Company receive any Shares of Common Stock
                  or other securities or property, or if the Company should
                  distribute securities of another corporation to its
                  stockholders, each Grantee shall be entitled to receive, in
                  lieu of the number of Restricted Stock shares, with a
                  corresponding adjustment to the price per Share of said
                  Incentive Awards, to which he would have been entitled if,
                  immediately prior to such corporate action, such Grantee had
                  been the holder of record of a number of Shares equal to the
                  number of the outstanding Incentive Awards payable in Shares
                  that were previously awarded to him. For this purpose, Shares
                  of Restricted Stock shall be treated the same as unrestricted
                  outstanding Shares of Common Stock. In this regard, the
                  Committee shall take whatever other action it deems
                  appropriate to preserve the rights of Grantees holding
                  outstanding Incentive Awards.

         (e)      Issue of Common Stock by the Company. Except as hereinabove
                  expressly provided in this Section 7.5 and subject to Section
                  7.7, the issue by the Company of shares of stock of any class,
                  or securities convertible into shares of stock of any class,
                  for cash or property, or for labor or services, either upon
                  direct sale or upon the exercise of rights or warrants to
                  subscribe therefor, or upon any conversion of shares or
                  obligations of the Company convertible into such shares or
                  other securities, shall not affect, and no adjustment by
                  reason thereof shall be made with respect to, the number of,
                  or price per Share of, any Incentive Awards then outstanding
                  under previously granted Incentive Awards; provided, however,
                  in



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                  such event, outstanding Shares of Restricted Stock shall be
                  treated the same as outstanding unrestricted Shares of Common
                  Stock.

         (f)      Acquisition of the Company. Subject to Section 7.7, in the
                  case of any sale of assets, merger, consolidation or
                  combination of the Company with or into another corporation
                  other than a transaction in which the Company is the
                  continuing or surviving corporation and which does not result
                  in the outstanding Shares being converted into or exchanged
                  for different securities, cash or other property, or any
                  combination thereof (an "Acquisition"), in the absolute
                  discretion of the Committee, any Grantee who holds an
                  outstanding Incentive Award shall have the right (subject to
                  any limitation applicable to the Incentive Award) thereafter
                  and during the term of the Incentive Award, to receive upon
                  exercise thereof the Acquisition Consideration (as defined
                  below) receivable upon the Acquisition by a holder of the
                  number of Shares which would have been obtained upon exercise
                  of the Incentive Award immediately prior to the Acquisition.
                  The term "Acquisition Consideration" shall mean the kind and
                  amount of shares of the surviving or new corporation, cash,
                  securities, evidence of indebtedness, other property or any
                  combination thereof receivable in respect of one Share upon
                  consummation of an Acquisition. The Committee, in its
                  discretion, shall have the authority to take whatever action
                  it deems appropriate to effectuate the provisions of this
                  subsection (f).

         (g)      Assumption under the Plan of Other Restricted Stock Awards.
                  The Committee, in its absolute discretion, may authorize the
                  assumption and continuation under the Plan of outstanding
                  stock-based incentive awards that were granted under a plan or
                  agreement that is or was maintained by a corporation or other
                  entity that was merged into, consolidated with, or whose stock
                  or assets were acquired by, the Company as the surviving
                  corporation. Any such action shall be upon such terms and
                  conditions as the Committee, in its discretion, may deem
                  appropriate, including provisions to preserve the holder's
                  rights under the previously granted stock-based restricted
                  stock award. Any such assumption and continuation of any such
                  previously granted and unexercised restricted stock award
                  shall be treated as an outstanding Incentive Award under the
                  Plan and shall thus count against the number of Shares
                  reserved for issuance pursuant to Section 4.1.

         (h)      Assumption of Incentive Awards by a Successor. In the event of
                  a dissolution or liquidation of the Company, a sale of all or
                  substantially all of the Company's assets, a merger or
                  consolidation involving the Company in which the Company is
                  not the surviving corporation, or a merger or consolidation
                  involving the Company in which the Company is the surviving
                  corporation but the holders of Shares of Common Stock receive
                  securities of another corporation and/or other property,
                  including cash, the Committee shall, in its absolute
                  discretion, have the right and power to:

                  (i)      cancel, effective immediately prior to the occurrence
                           of such corporate event, each outstanding Incentive
                           Award (whether or not then



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                           exercisable), and, in full consideration of such
                           cancellation, pay to the Grantee to whom such
                           Incentive Award was granted an amount in cash equal
                           to the excess of (A) the value, as determined by the
                           Committee, of the property (including cash) received
                           by the holder of a Share of Common Stock as a result
                           of such event over (B) the Grantee's purchase price,
                           if any, under such Incentive Award; or

                  (ii)     provide for the exchange of each Incentive Award
                           outstanding immediately prior to such corporate event
                           (whether or not then exercisable) for another award
                           on some or all of the property for which such
                           Incentive Award is exchanged and, incident thereto,
                           make an equitable adjustment as determined by the
                           Committee, in its discretion, in the purchase price
                           of the Incentive Award, or the number of Shares or
                           amount of cash subject to the Incentive Award or, if
                           deemed appropriate, provide for a cash payment to the
                           Grantee in consideration for the exchange of his
                           Incentive Award.

                  The Committee, in its discretion, shall have the authority to
                  take whatever action it deems appropriate to effectuate the
                  provisions of this subsection (h).

7.6      TERMINATION OF EMPLOYMENT, DEATH AND DISABILITY.

         (a)      Termination of Employment. Unless otherwise expressly provided
                  in his Restricted Stock Agreement, upon Grantee's Retirement
                  or any other Termination of Employment for any reason except
                  due to his death or Disability, any non-vested portion of his
                  outstanding Incentive Award at the time of such termination
                  shall automatically expire and terminate and no further
                  vesting shall occur.

         (b)      Disability or Death. Unless otherwise expressly provided in
                  his Restricted Stock Agreement, upon termination of Employment
                  as a result of the Grantee's Disability or death, any
                  non-vested portion of his Incentive Award shall become 100%
                  vested upon termination of Employment due to Disability or
                  death.

         (c)      Continuation of Incentive Award. Subject to applicable law, in
                  the event that a Grantee ceases to be an Employee, for
                  whatever reason, the Committee and Grantee may mutually agree
                  with respect to any outstanding Incentive Award then held by
                  the Grantee (i) for an acceleration or other adjustment in any
                  vesting schedule applicable to the Incentive Award, or (ii) to
                  any other change in the terms and conditions of the Incentive
                  Award. In the event of any such change to an outstanding
                  Incentive Award, a written amendment to the Grantee's
                  Restricted Stock Agreement shall be required.

7.7      CHANGE IN CONTROL.

         Notwithstanding any contrary provision in the Plan, in the event of a
         Change in Control (as defined below), the following actions shall
         automatically occur as of the day



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<PAGE>   12


         immediately preceding the Change in Control date unless otherwise
         expressly provided in the Grantee's Restricted Stock Agreement:

         (a)      all of the restrictions and conditions of any Incentive Award
                  then outstanding shall be deemed satisfied, and the
                  Restriction Period with respect thereto shall be deemed to
                  have lapsed and expired; and

         (b)      all Restricted Stock shall be 100% vested and deemed earned in
                  full.

         Notwithstanding any other provision of the Plan, unless expressly
         provided otherwise in the Grantee's Restricted Stock Agreement, the
         provisions of this Section 7.7 may not be terminated, amended, or
         modified to adversely affect any Incentive Award theretofore granted
         under the Plan without the prior written consent of the Grantee with
         respect to his outstanding Incentive Award subject, however, to the
         last paragraph of this Section 7.7.

7.8      EXCHANGE OF INCENTIVE AWARDS.

         The Committee may, in its discretion, permit any Grantee to surrender
         outstanding Incentive Awards in order to exercise or realize his rights
         under other Incentive Awards or in exchange for the grant of new
         Incentive Awards, or require holders of Incentive Awards to surrender
         outstanding Incentive Awards (or comparable rights under other plans or
         arrangements) as a condition precedent to the grant of new Incentive
         Awards.

7.9      FINANCING.

         The Company may extend and maintain, or arrange for and guarantee, the
         extension and maintenance of financing to any Grantee to purchase
         Shares pursuant to exercise of an Incentive Award upon such terms as
         are approved by the Committee in its discretion.


                                  ARTICLE VIII

                            MISCELLANEOUS PROVISIONS

8.1      FUNDING AND LIABILITY OF COMPANY.

         No provision of the Plan shall require the Company, for the purpose of
         satisfying any obligations under the Plan, to purchase assets or place
         any assets in a trust or other entity to which contributions are made,
         or otherwise to segregate any assets. In addition, the Company shall
         not be required to maintain separate bank accounts, books, records or
         other evidence of the existence of a segregated or separately
         maintained or administered fund for purposes of the Plan. The Company
         shall not be required to segregate any assets that may at any time be
         represented by cash, Common Stock or rights thereto. The Plan shall not
         be construed as providing for such segregation, nor shall the Company,
         the Board or the Committee be deemed to be a trustee of any cash,
         Common Stock or rights thereto. Any liability or obligation of the
         Company to any Grantee with respect to an



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<PAGE>   13


         Incentive Award shall be based solely upon any contractual obligations
         that may be created by the Plan and any Restricted Stock 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, 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 the Plan.

8.2      WITHHOLDING TAXES.

         (a)      Tax Withholding. The Company shall have the power and the
                  right to deduct or withhold, or require a Grantee to remit to
                  the Company, an amount sufficient to satisfy federal, state,
                  and local taxes, domestic or foreign, required by law or
                  regulation to be withheld with respect to any taxable event
                  arising as a result of an Incentive Award.

         (b)      Share Withholding. With respect to tax withholding required
                  upon the lapse of restrictions on Shares of Restricted Stock,
                  or upon any other taxable event arising as a result of any
                  Incentive Awards, Grantees may elect, subject to the approval
                  of the Committee in its discretion, to satisfy the withholding
                  requirement, in whole or in part, by having the Company
                  withhold Shares having a Fair Market Value on the date the tax
                  is to be determined equal to the minimum statutory total tax
                  which could be imposed on the transaction. All such elections
                  shall be made in writing, signed by the Grantee, and shall be
                  subject to any restrictions or limitations that the Committee,
                  in its discretion, deems appropriate.

         (c)      Loans. The Committee, in its discretion, may provide for
                  loans, on either a short term or demand basis, from the
                  Company to a Grantee to permit the payment of taxes required
                  by law.

8.3      NO GUARANTEE OF TAX CONSEQUENCES.

         Neither the Company nor the Committee makes any commitment or guarantee
         that any federal, state or local tax treatment will apply or be
         available to any person participating or eligible to participate
         hereunder.

8.4      DESIGNATION OF BENEFICIARY BY PARTICIPANT.

         Each Grantee may, from time to time, name any beneficiary or
         beneficiaries (who may be named contingently or successively) to whom
         any benefit under any Incentive Award is to be paid in case of his
         death before he receives any or all of such benefit. Each such
         designation shall revoke all prior designations by the same Grantee,
         shall be in a form prescribed by the Committee, and will be effective
         only when filed by the Grantee in writing with the Committee during the
         Grantee's lifetime.

         A Grantee may, from time to time, revoke or change his beneficiary
         designation by filing a new designation form with the Committee (or its
         delegate). The last valid designation



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<PAGE>   14


         received shall be controlling; provided, however, that no beneficiary
         designation, or change or revocation thereof, shall be effective unless
         received prior to the Grantee's death and in no event shall it be
         effective as of a date prior to its receipt. Notwithstanding any
         contrary provision of this Section 8.3, no beneficiary designation made
         by a married Grantee, other than one under which the surviving lawful
         spouse of such Grantee is designated as the sole beneficiary, shall be
         valid and effective without the written consent of such spouse.

         If no valid and effective beneficiary designation exists at the time of
         the Grantee's death, or if no designated beneficiary survives the
         Grantee, or if such designation conflicts with applicable law, the
         payment of the Grantee's Incentive Award, if earned and payable
         hereunder, shall be made to the Grantee's surviving lawful spouse, if
         any, or if there is no such surviving spouse, to the executor or
         administrator of his estate. If the Committee is in doubt as to the
         right of any person to receive such amount, the Committee may direct
         that the amount be paid into any court of competent jurisdiction in an
         interpleader action, and such payment shall be a full and complete
         discharge of any liability or obligation of the Plan, Company,
         Committee or Board therefor.

8.5      AMENDMENT AND TERMINATION.

         The Board or the Committee shall have the power and authority to
         terminate or amend the Plan at any time. No termination, amendment, or
         modification of the Plan shall adversely affect in any material way any
         outstanding Incentive Award previously granted to a Grantee under the
         Plan, without the written consent of such Grantee or other designated
         holder of such Incentive Award.

8.6      REQUIREMENTS OF LAW.

         The granting of Incentive Awards and the issuance of Shares under the
         Plan shall be subject to all applicable laws, rules, and regulations,
         and to such approvals by any governmental agencies or national
         securities exchanges as may be required. Certificates evidencing Shares
         of Common Stock delivered under the 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 and regulations 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 to make
         appropriate reference to such restrictions.

8.7      SUCCESSORS.

         All obligations of the Company under the Plan with respect to Incentive
         Awards granted hereunder shall be binding on any successor to the
         Company, whether the existence of such successor is the result of a
         direct or indirect purchase, merger, consolidation, or otherwise, of
         all or substantially all of the business and/or assets of the Company.



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<PAGE>   15


8.8      MISCELLANEOUS PROVISIONS.

         (a)      No Employee shall have any claim or right to be granted an
                  Incentive Award under the Plan. Neither the Plan, nor any
                  action taken hereunder, shall be construed as giving any
                  Employee any right to receive future Incentive Awards upon the
                  same terms and conditions as previously granted.

         (b)      No Shares of Common Stock shall be issued hereunder unless
                  counsel for the Company is then satisfied that such issuance
                  will be in compliance with federal and state securities laws.

         (c)      The expenses of the Plan shall be borne by the Company.

         (d)      By accepting any Incentive Award, each Grantee and each person
                  claiming by or through him shall be deemed to have indicated
                  his acceptance of the Plan.

8.9      SEVERABILITY.

         In the event that any provision of the Plan shall be held illegal,
         invalid or unenforceable for any reason, such provision shall be fully
         severable, but shall not affect the remaining provisions of the Plan,
         and the Plan shall be construed and enforced as if the illegal,
         invalid, or unenforceable provision was not included herein.

8.10     GENDER, TENSE AND HEADINGS.

         Whenever the context so requires, words of the masculine gender used
         herein shall include the feminine and neuter, and words used in the
         singular shall include the plural. Section headings as used herein are
         inserted solely for convenience and reference and constitute no part of
         the interpretation or construction of the Plan.

8.11     GOVERNING LAW.

         The Plan shall be interpreted, construed and constructed in accordance
         with the laws of the State of Texas without regard to its conflicts of
         law provisions, except as may be superseded by applicable laws of the
         United States.




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