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                                                                    EXHIBIT 10.3


                               THOMAS GROUP, INC.

                              AMENDED AND RESTATED
                             1992 STOCK OPTION PLAN

                            SCOPE AND PURPOSE OF PLAN

         Thomas Group, Inc., a Delaware corporation (the "Corporation"), has
amended and restated the 1992 Stock Option Plan as set forth herein (the "Plan")
to provide for the granting of Nonstatutory Options and Incentive Stock Options
(hereafter defined) to certain Key Persons.

         The purpose of the Plan is to provide an incentive for Key Persons of
the Corporation or its Subsidiaries (hereafter defined) to remain in the service
of the Corporation or its Subsidiaries, to extend to them the opportunity to
acquire a proprietary interest in the Corporation so that they will apply their
best efforts for the benefit of the Corporation, and to aid the Corporation in
attracting able persons to enter the service of the Corporation and its
Subsidiaries.

SECTION 1. DEFINITIONS

         1.1 "Acquiring Person" means any Person other than the Corporation, any
of the Corporation's Subsidiaries, any employee benefit plan of the Corporation
or of a Subsidiary of the Corporation or of a corporation owned directly or
indirectly by the stockholders of the Corporation in substantially the same
proportions as their ownership of stock of the Corporation, or any trustee or
other fiduciary holding securities under an employee benefit plan of the
Corporation or of a Subsidiary of the Corporation or of a corporation owned
directly or indirectly by the stockholders of the Corporation in substantially
the same proportions as their ownership of stock of the Corporation.

         1.2 "Award" means the grant of any form of Option under the Plan,
whether granted singly, in combination, or in tandem, to a Holder pursuant to
the terms, conditions, and limitations that the Committee may establish in order
to fulfill the objectives of the Plan.

         1.3 "Award Agreement" means the written agreement between the
Corporation and a Holder evidencing the terms, conditions, and limitations of
the Award granted to that Holder.

         1.4 "Board of Directors" means the board of directors of the
Corporation.

         1.5 "Business Day" means any day other than a Saturday, a Sunday, or a
day on which banking institutions in the State of Texas are authorized or
obligated by law or executive order to close.

         1.6 "Change in Control" means the event that is deemed to have occurred
if:

                  (a) any Acquiring Person is or becomes the "beneficial owner"
         (as defined in Rule 13d-3 under the Exchange Act), directly or
         indirectly, of securities of the Corporation representing fifty percent
         or more of the combined voting power of the then outstanding Voting
         Securities of the Corporation; or

                  (b) members of the Incumbent Board cease for any reason to
         constitute at least a majority of the Board of Directors; or

                  (c) a public announcement is made of a tender or exchange
         offer by any Acquiring Person for fifty percent or more of the
         outstanding Voting Securities of the Corporation, and the Board of
         Directors approves or fails to oppose that tender or exchange offer in
         its statements in Schedule 14D-9 under the Exchange Act; or

                  (d) the stockholders of the Corporation approve a merger or
         consolidation of the Corporation with any other corporation or
         partnership (or, if no such approval is required, the consummation of
         such a


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         merger or consolidation of the Corporation), other than a merger or
         consolidation that would result in the Voting Securities of the
         Corporation outstanding immediately before the consummation thereof
         continuing to represent (either by remaining outstanding or by being
         converted into Voting Securities of the surviving entity or of a parent
         of the surviving entity) a majority of the combined voting power of the
         Voting Securities of the surviving entity (or its parent) outstanding
         immediately after that merger or consolidation; or

                  (e) the stockholders of the Corporation approve a plan of
         complete liquidation of the Corporation or an agreement for the sale or
         disposition by the Corporation of all or substantially all the
         Corporation's assets (or, if no such approval is required, the
         consummation of such a liquidation, sale, or disposition in one
         transaction or series of related transactions) other than a
         liquidation, sale, or disposition of all or substantially all the
         Corporation's assets in one transaction or a series of related
         transactions to a corporation owned directly or indirectly by the
         stockholders of the Corporation in substantially the same proportions
         as their ownership of stock of the Corporation.

         1.7 "Class B Stock" means the Corporation's authorized Class B common
stock, $.01 par value per share, as described in the Corporation's Amended and
Restated Certificate of Incorporation, as amended on August 13, 1992, or any
securities which are substituted for the Class B Stock as provided in Section 7.

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

         1.9 "Committee" means the committee appointed pursuant to Section 3 by
the Board of Directors to administer this Plan.

         1.10 "Corporation" means Thomas Group, Inc., a Delaware corporation.

         1.11 "Date of Grant" has the meaning given it in Paragraph 4.3.

         1.12 "Effective Date" means the closing date of the first sale of
shares of Stock to underwriters in a firm commitment underwriting pursuant to
the Registration Statement.

         1.13 "Exchange Act" means the Securities Exchange Act of 1934, or any
successor law, as it may be amended from time to time.

         1.14 "Exercise Notice" has the meaning given it in Paragraph 5.5.

         1.15 "Exercise Price" has the meaning given it in Paragraph 5.4.

         1.16 "Fair Market Value" means, for a particular day:

                  (a) If shares of Stock of the same class are listed or
         admitted to unlisted trading privileges on any national or regional
         securities exchange at the date of determining the Fair Market Value,
         then the last reported sale price, regular way, on the composite tape
         of that exchange on the last Business Day before the date in question
         or, if no such sale takes place on that Business Day, the average of
         the closing bid and asked prices, regular way, in either case as
         reported in the principal consolidated transaction reporting system
         with respect to securities listed or admitted to unlisted trading
         privileges on that securities exchange; or

                  (b) If shares of Stock of the same class are not listed or
         admitted to unlisted trading privileges as provided in Subparagraph
         1.16(a) and if sales prices for shares of Stock of the same class in
         the over-the-counter market are reported by the National Association of
         Securities Dealers, Inc. Automated Quotations, Inc. ("NASDAQ") National
         Market System (or such other system then in use) at the date of




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         determining the Fair Market Value, then the last reported sales price
         so reported on the last Business Day before the date in question or, if
         no such sale takes place on that Business Day, the average of the high
         bid and low asked prices so reported; or

                  (c) If shares of Stock of the same class are not listed or
         admitted to unlisted trading privileges as provided in subparagraph
         1.16(a) and sales prices for shares of Stock of the same class are not
         reported by the NASDAQ National Market System (or a similar system then
         in use) as provided in subparagraph 1.16(b), and if bid and asked
         prices for shares of Stock of the same class in the over-the-counter
         market are reported by NASDAQ (or, if not so reported, by the National
         Quotation Bureau Incorporated) at the date of determining the Fair
         Market Value, then the average of the high bid and low asked prices on
         the last Business Day before the date in question; or

                  (d) If shares of Stock of the same class are not listed or
         admitted to unlisted trading privileges as provided in subparagraph
         1.16(a) and sales prices or bid and asked prices therefor are not
         reported by NASDAQ (or the National Quotation Bureau Incorporated) as
         provided in subparagraph 1.16(b) or subparagraph 1.16(c) at the date of
         determining the Fair Market Value, then the value determined in good
         faith by the Committee, which determination shall be conclusive for all
         purposes; or

                  (e) If shares of Stock of the same class are listed or
         admitted to unlisted trading privileges as provided in subparagraph
         1.16(a) or sales prices or bid and asked prices therefor are reported
         by NASDAQ (or the National Quotation Bureau Incorporated) as provided
         in subparagraph 1.16(b) or subparagraph 1.16(c) at the date of
         determining the Fair Market Value, but the volume of trading is so low
         that the Board of Directors determines in good faith that such prices
         are not indicative of the fair value of the Stock, then the value
         determined in good faith by the Committee, which determination shall be
         conclusive for all purposes notwithstanding the provisions of
         subparagraphs 1.16(a), (b), or (c).

For purposes of the redemption provided for in subparagraph 7.3(d)(v), Fair
Market Value shall have the meaning and shall be determined as provided above;
provided, however, that the Committee, with respect to any such redemption,
shall have the right to determine that the Fair Market Value for purposes of the
redemption should be an amount measured by the value of the shares of stock,
other securities, cash, or property otherwise being received by holders of
shares of Stock in connection with the Restructure, and upon that determination
the Committee shall have the power and authority to determine Fair Market Value
for purposes of the redemption based upon the value of such shares of stock,
other securities, cash or property. Any such determination by the Committee
shall be conclusive for all purposes.

         1.17 "Holder" means a Key Person to whom an Award has been granted.

         1.18 "Incentive Stock Option" means an option to purchase shares of
Stock pursuant to this Plan and which is intended to qualify as an incentive
stock option under Section 422 of the Code.

         1.19 "Incumbent Board" means the individuals who, as of the Effective
Date, constitute the Board of Directors and any other individual who becomes a
director of the Corporation after that date and whose election or appointment by
the Board of Directors or nomination for election by the Corporation's
stockholders was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board.

         1.20 "Key Person" means any director of the Corporation or independent
contractor whom the Committee identifies as having a direct and significant
effect on the performance of the Corporation or any of its Subsidiaries.

         1.21 "Nonstatutory Option" means an option to purchase shares of Stock
pursuant to this Plan and which is not intended to qualify as an incentive stock
option under Section 422 of the Code.



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         1.22 "Non-Surviving Event" means an event of Restructure as described
in either subparagraph (b) or (c) of Paragraph 1.27.

         1.23 "Normal Retirement" means the separation of the Holder from
employment with the Corporation and its Subsidiaries on account of retirement at
any time on or after the date on which the Holder reaches age sixty.

         1.24 "Option" means a Nonstatutory Option or an Incentive Stock Option
granted pursuant to this Plan.

         1.25 "Person" means any person or entity of any nature whatsoever,
specifically including (but not limited to) an individual, a firm, a company, a
corporation, a partnership, a trust or other entity. A Person, together with
that Person's affiliates and associates (as those terms are defined in Rule
12b-2 under the Exchange Act for purposes of this definition only), and any
Persons acting as a partnership, limited partnership, joint venture,
association, syndicate, or other group (whether or not formally organized), or
otherwise acting jointly or in concert or in a coordinated or consciously
parallel manner (whether or not pursuant to any express agreement), for the
purpose of acquiring, holding, voting, or disposing of securities of the
Corporation with that Person, shall be deemed a single "Person."

         1.26 "Plan" means the Corporation's Amended and Restated 1992 Stock
Option Plan, as it may be amended from time to time.

         1.27 "Restructure" means the occurrence of any one or more of the
following:

                  (a) The merger or consolidation of the Corporation with any
         Person, whether effected as a single transaction or a series of related
         transactions, with the Corporation remaining the continuing or
         surviving entity of that merger or consolidation and the Stock
         remaining outstanding and not changed into or exchanged for stock or
         other securities of any other Person or of the Corporation, cash, or
         other property;

                  (b) The merger or consolidation of the Corporation with any
         Person, whether effected as a single transaction or a series of related
         transactions, with (i) the Corporation not being the continuing or
         surviving entity of that merger or consolidation or (ii) the
         Corporation remaining the continuing or surviving entity of that merger
         or consolidation but all or a part of the outstanding shares of Stock
         are changed into or exchanged for stock or other securities of any
         other Person or the Corporation, cash, or other property; or

                  (c) The transfer, directly or indirectly, of all or
         substantially all of the assets of the Corporation (whether by sale,
         merger, consolidation, liquidation, or otherwise) to any Person whether
         effected as a single transaction or a series of related transactions.

         1.28 "Securities Act" means the Securities Act of 1933, or any
successor law, as it may be amended from time to time.

         1.29 "Stock" means the Corporation's authorized common stock, $.01 par
value per share, as described in the Corporation's Amended and Restated
Certificate of Incorporation as it shall have been amended on August 13, 1993,
or any other securities that are substituted for the Stock as provided in
Section 7.

         1.30 "Subsidiary" means, with respect to any Person, any corporation or
other entity of which a majority of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by that Person.

         1.31     "Total Shares" has the meaning given it in Paragraph 7.2.

         1.30 "Voting Securities" means any securities that are entitled to vote
generally in the election of directors, in the admission of general partners, or
in the selection of any other similar governing body.



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SECTION 2.  SHARES OF STOCK SUBJECT TO THE PLAN

         2.1 Maximum Amount of Shares. Subject to the provisions of Paragraph
2.6 and Section 7 of the Plan, the aggregate number of shares of Stock that may
be issued, transferred, or exercised pursuant to Awards under the Plan shall be
1,100,000, unless amended by the Board of Directors, and the aggregate number of
shares of Class B Stock that may be issued, transferred or exercised pursuant to
Awards under the Plan shall be 600,000, unless amended by the Board of
Directors.

         2.2 Reduction in Available Shares. In computing the total number of
shares available at a particular time for Awards under the Plan, there shall be
counted against the limitations stated in Paragraph 2.1 the number of shares of
Stock or Class B Stock, as the case may be, subject to issuance upon exercise or
settlement of Awards and the number of shares of Stock or Class B Stock, as the
case may be, that have been issued upon exercise or settlement of Awards (except
as otherwise provided in Paragraph 2.3).

         2.3 Restoration of Unused and Surrendered Shares. If Stock or Class B
Stock, as the case may be, subject to any Award is not issued or transferred, or
ceases to be issuable or transferable for any reason, including (but not
exclusively) because an Award is forfeited, terminated, expires unexercised, or
is exchanged for other Awards, the shares of Stock or Class B Stock, as the case
may be, that were subject to that Award shall no longer be charged against the
number of available shares provided for in Paragraph 2.2 and shall again be
available for issue, transfer, or exercise pursuant to Awards under the Plan to
the extent of such forfeiture, termination, expiration, or other cessation of
its subjection to an Award.

         2.4 Description of Shares. The shares to be delivered under the Plan
shall be made available from (a) authorized but unissued shares of Stock or
Class B Stock, as the case may be, (b) Stock or Class B Stock, as the case may
be, held in the treasury of the Corporation, or (c) previously issued shares of
Stock or Class B Stock, as the case may be, reacquired by the Corporation,
including shares purchased on the open market, in each situation as the Board of
Directors or the Committee may determine from time to time at its sole option.

         2.5 Registration and Listing of Shares. From time to time, the Board of
Directors and appropriate officers of the Corporation shall and are authorized
to take whatever actions are necessary to file required documents with
governmental authorities, stock exchanges, and other appropriate Persons to make
shares of Stock or Class B Stock, as the case may be, available for issuance
pursuant to Awards.

         2.6 Reduction in Outstanding Shares of Stock or Class B Stock. Nothing
in this Section 2 shall impair the right of the Corporation to reduce the number
of outstanding shares of Stock or Class B Stock, as the case may be, pursuant to
repurchases, redemptions, or otherwise; provided, however, that no reduction in
the number of outstanding shares of Stock or Class B Stock, as the case may be,
shall (a) impair the validity of any outstanding Award, whether or not that
Award is fully exercisable or fully vested or (b) impair the status of any
shares of Stock or Class B Stock, as the case may be, previously issued pursuant
to an Award or thereafter issued pursuant to a then-outstanding Award as duly
authorized, validly issued, fully paid, and nonassessable shares.

SECTION 3.  ADMINISTRATION OF THE PLAN

         3.1 Committee. The Board of Directors or the Committee shall administer
the Plan. The number of persons that shall constitute the Committee shall be
determined from time to time by a majority of all the members of the Board of
Directors, and, unless that majority of the Board of Directors determines
otherwise, shall be no less than two persons.



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         3.2 Duration, Removal, Etc. The members of the Committee shall serve at
the pleasure of the Board of Directors, which shall have the power, at any time
and from time to time, to remove members from or add members to the Committee.
Removal from the Committee may be with or without cause. Any individual serving
as a member of the Committee shall have the right to resign from membership in
the Committee by at least three day's written notice to the Board of Directors.
The Board of Directors, and not the remaining members of the Committee, shall
have the power and authority to fill vacancies on the Committee, however caused.
The Board of Directors shall promptly fill any vacancy.

         3.3 Meetings and Actions of Committee. The Board of Directors shall
designate which of the Committee members shall be the chairman of the Committee.
If the Board of Directors fails to designate a Committee chairman, the members
of the Committee shall elect one of the Committee members as chairman, who shall
act as chairman until he ceases to be a member of the Committee or until the
Board of Directors elects a new chairman. The Committee shall hold its meetings
at those times and places as the chairman of the Committee may determine. At all
meetings of the Committee, a quorum for the transaction of business shall be
required, and a quorum shall be deemed present if at least a majority of the
members of the Committee are present. At any meeting of the Committee, each
member shall have one vote. All decisions and determinations of the Committee
shall be made by the majority vote or majority decision of all of its members
present at a meeting at which a quorum is present; provided, however, that any
decision or determination reduced to writing and signed by all of the members of
the Committee shall be as fully effective as if it had been made at a meeting
that was duly called and held. The Committee may make any rules and regulations
for the conduct of its business that are not inconsistent with the provisions of
the Plan, the Restated Certificate of Incorporation, and the by-laws of the
Corporation, as the Committee may deem advisable.

         3.4 Committee's Powers. Subject to the express provisions of the Plan,
the Committee shall have the authority, in its sole and absolute discretion, (a)
to adopt, amend, and rescind administrative and interpretive rules and
regulations relating to the Plan; (b) to determine the Key Persons to whom, and
the time or times at which, Awards shall be granted; (c) to determine the number
of shares of Stock or Class B Stock, as the case may be, that shall be the
subject of each Award; (d) to determine the terms and provisions of each Award
Agreement (which need not be identical), including provisions defining or
otherwise relating to (i) the term and the period or periods and extent of
exercisability of the Options, (ii) the extent to which the transferability of
shares of Stock or Class B Stock, as the case may be, issued or transferred
pursuant to any Award is restricted, (iii) the effect of termination of
employment on the Award, and (iv) the effect of approved leaves of absence
(consistent with any applicable regulations of the Internal Revenue Service);
(e) to accelerate, pursuant to Section 7, the time of exercisability of any
Option that has been granted; (f) to construe the respective Award Agreements
and the Plan; (g) to make determinations of the Fair Market Value of Stock or
Class B Stock, as the case may be, pursuant to the Plan; (h) to delegate its
duties under the Plan to such agents as it may appoint from time to time; and
(i) to make all other determinations, perform all other acts, and exercise all
other powers and authority necessary or advisable for administering the Plan,
including the delegation of those ministerial acts and responsibilities as the
Committee deems appropriate. The Committee may correct any defect, supply any
omission, or reconcile any inconsistency in the Plan, in any Award, or in any
Award Agreement in the manner and to the extent it deems necessary or desirable
to carry the Plan into effect, and the Committee shall be the sole and final
judge of that necessity or desirability. The determinations of the Committee on
the matters referred to in this Paragraph 3.4 shall be final and conclusive.

SECTION 4. ELIGIBILITY AND PARTICIPATION

         4.1 Key Persons. Awards may be granted pursuant to the Plan only to
persons who are Key Persons at the time of the grant thereof. Only employees of
Corporation or any of its Subsidiaries, including employee-directors, shall be
eligible to receive grants of Incentive Stock Options.

         4.2 Grant of Awards. Subject to the express provisions of the Plan, the
Committee shall determine which Key Persons shall be granted Awards from time to
time. In making grants, the Committee shall take into consideration 



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the contribution the potential Holder has made or may make to the success of the
Corporation or its Subsidiaries and such other considerations as the Board of
Directors may from time to time specify. The Committee shall also determine the
number of shares subject to each of the Awards and shall authorize and cause the
Corporation to grant Awards in accordance with those determinations.

         4.3 Date of Grant. The date on which the Committee completes all action
resolving to offer an Award to an individual, including the specification of the
number of shares of Stock to be subject to the Award, shall be the date on which
the Award covered by an Award Agreement is granted (the "Date of Grant"), even
though certain terms of the Award Agreement may not be determined at that time
and even though the Award Agreement may not be executed until a later time. In
no event shall a Holder gain any rights in addition to those specified by the
Committee in its grant, regardless of the time that may pass between the grant
of the Award and the actual execution of the Award Agreement by the Corporation
and the Holder.

         4.4 Award Agreements. Each Award granted under the Plan shall be
evidenced by an Award Agreement that is executed by the Corporation and the Key
Person to whom the Award is granted and incorporating those terms that the
Committee shall deem necessary or desirable. In the case of an Incentive Stock
Option, the Award Agreement shall also include provisions that may be necessary
to assure that the option is an incentive stock option under Section 422 of the
Code. More than one Award may be granted under the Plan to the same Key Person
and be outstanding concurrently.

         4.5 No Right to Award. The adoption of the Plan shall not be deemed to
give any person a right to be granted an Award.

SECTION 5.  TERMS AND CONDITIONS OF OPTIONS

         All Options granted under the Plan shall comply with, and the related
Award Agreements shall be deemed to include and be subject to, the terms and
conditions set forth in this Section 5 (to the extent each term and condition
applies to the form of Option) and also to the terms and conditions set forth in
Section 7 and Section 8; provided, however, that the Committee may authorize an
Award Agreement that expressly contains terms and provisions that differ from
the terms and provisions set forth in Paragraphs 7.2, 7.3, and 7.4 and any of
the terms and provisions of Section 8 (other than Paragraph 8.6).

         5.1 Number of Shares. Each Award Agreement shall state the total number
of shares of Stock or Class B Stock, as the case may be, to which it relates.

         5.2 Vesting. Each Award Agreement shall state the time or periods in
which or the conditions upon, satisfaction of which the right to exercise the
Option or a portion thereof shall vest and the number of shares of Stock or
Class B Stock, as the case may be, for which the right to exercise the Option
shall vest at each such time, period, or fulfillment of condition.

         5.3 Expiration of Options. Options may be exercised during the term
determined by the Committee and set forth in the Award Agreement; provided that
no Option shall be exercised after the expiration of a period of ten years
commencing on the Date of Grant of the Option.

         5.4 Exercise Price. Each Award Agreement shall state the exercise price
per share of Stock (the "Exercise Price"). The exercise price per share of Stock
subject to a Nonstatutory Option shall not be less than the par value per share
of the Stock. The exercise price for an Incentive Stock Option shall be an
amount not less than the Fair Market Value per share of the Stock on the Date of
Grant.



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         5.5 Method of Exercise. The Option shall be exercisable only by written
notice of exercise (the "Exercise Notice") delivered to the Corporation during
the term of the Option, which notice shall (a) state the number of shares of
Stock or Class B Stock, as the case may be, with respect to which the Option is
being exercised, (b) be signed by the Holder of the Option or, if the Holder is
dead or disabled, by the person authorized to exercise the Option pursuant to
Paragraphs 8.2, (c) be accompanied by the Exercise Price for all shares of Stock
or Class B Stock, as the case may be, for which the Option is exercised, and (d)
include such other information, instruments, and documents as may be required to
satisfy any other condition to exercise contained in the Award Agreement. The
Option shall not be deemed to have been exercised unless all of the requirements
of the preceding provisions of this Paragraph 5.5 have been satisfied.

         5.6 Medium and Time of Payment. The Exercise Price of an Option shall
be payable in full upon the exercise of the Option (a) in cash or by an
equivalent means acceptable to the Committee, (b) on the Committee's prior
consent, with shares of Stock or Class B Stock, as the case may be, owned by the
Holder (including shares received upon exercise of the Option or restricted
shares already held by the Holder) and having a Fair Market Value at least equal
to the aggregate Exercise Price payable in connection with such exercise, or (c)
by any combination of clauses (a) and (b). If the Committee elects to accept
shares of Stock or Class B Stock, as the case may be, in payment of all or any
portion of the Exercise Price, then (for purposes of payment of the Exercise
Price) those shares of Stock or Class B Stock, as the case may be, shall be
deemed to have a cash value equal to their aggregate Fair Market Value
determined as of the date of the delivery of the Exercise Notice. If the
Committee elects to accept shares of restricted Stock or Class B Stock, as the
case may be, in payment of all or any portion of the Exercise Price, then an
equal number of shares issued pursuant to the exercise shall be restricted on
the same terms and for the restriction period remaining on the shares used for
payment.

         5.7 Payment with Sale Proceeds. In addition, at the request of the
Holder and to the extent permitted by applicable law, the Committee may (but
shall not be required to) approve arrangements with a brokerage firm under which
that brokerage firm, on behalf of the Holder, shall pay to the Corporation the
Exercise Price of the Option being exercised, and the Corporation shall promptly
deliver the exercised shares to the brokerage firm. To accomplish this
transaction, the Holder must deliver to the Corporation an Exercise Notice
containing irrevocable instructions from the Holder to the Corporation to
deliver the stock certificates directly to the broker. Upon receiving a copy of
the Exercise Notice acknowledged by the Corporation, the broker shall sell that
number of shares of Stock or loan the Holder an amount sufficient to pay the
Exercise Price and any withholding obligations due. The broker shall then
deliver to the Corporation that portion of the sale or loan proceeds necessary
to cover the Exercise Price and any withholding obligations due.

         5.8 Payment of Taxes. The Committee may, in its discretion, require a
Holder to pay to the Corporation (or the Corporation's Subsidiary if the Holder
is an employee of a Subsidiary of the Corporation), at the time of the exercise
of an Option, the amount that the Committee deems necessary to satisfy the
Corporation's or its Subsidiary's current or future obligation to withhold
federal, state, or local income or other taxes that the Holder incurs by
exercising an Option. Upon the exercise of an Option requiring tax withholding,
a Holder may (a) direct the Corporation to withhold from the shares of Stock or
Class B Stock, as the case may be, to be issued to the Holder the number of
shares necessary to satisfy the Corporation's obligation to withhold taxes, that
determination to be based on the shares' Fair Market Value as of the date on
which tax withholding is to be made; (b) deliver to the Corporation sufficient
shares of Stock or Class B Stock, as the case may be, (based upon the Fair
Market Value at date of withholding) to satisfy the Corporation's tax
withholding obligations, based on the shares' Fair Market Value as of the date
of exercise; or (c) deliver sufficient cash to the Corporation to satisfy its
tax withholding obligations. Holders who elect to use such a stock withholding
feature must make the election at the time and in the manner that the Committee
prescribes. The Committee may, at its sole option, deny any Holder's request to
satisfy withholding obligations through Stock or Class B Stock, as the case may
be, instead of cash. In the event the Committee subsequently determines that the
aggregate Fair Market Value (as determined above) of any shares of Stock or
Class B Stock, as the case may be, withheld as 



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payment of any tax withholding obligation is insufficient to discharge that tax
withholding obligation, then the Holder shall pay to the Corporation,
immediately upon the Committee's request, the amount of that deficiency.

         5.9 No Fractional Shares. The Corporation shall not in any case be
required to sell, issue, or deliver a fractional share with respect to any
Option. In lieu of the issuance of any fractional share of Stock or Class B
Stock, as the case may be, the Corporation shall pay to the Holder an amount in
cash equal to the same fraction (as the fractional Stock or Class B Stock, as
the case may be) of the Fair Market Value of a share of Stock or Class B Stock,
as the case may be, determined as of the date of the applicable Exercise Notice.

         5.10 Modification, Extension, and Renewal of Options. Subject to the
terms and conditions of and within the limitations of the Plan, and any consent
required by the last sentence of this Paragraph 5.10, the Committee may (a)
modify, extend, or renew outstanding Options granted under the Plan and (b)
accept the surrender of Options outstanding hereunder (to the extent not
previously exercised) and authorize the granting of new Options in substitution
for outstanding Options (to the extent not previously exercised). Nevertheless,
without the consent of the Holder, the Committee may not modify any outstanding
Options so as to specify a higher or lower Exercise Price. In addition, no
modification of an Option granted hereunder shall, without the consent of the
Holder, alter or impair any rights or obligations under any Option theretofore
granted hereunder to such Holder under the Plan.

         5.11 Other Agreement Provisions. The Award Agreements authorized under
the Plan shall contain such provisions in addition to those required by the Plan
(including, without limitation, restrictions or the removal of restrictions upon
the exercise of the Option and the retention or transfer of shares thereby
acquired) as the Committee may deem advisable.

SECTION 6.  LIMITATIONS OF INCENTIVE STOCK OPTIONS

         Notwithstanding anything to the contrary, the following provisions of
this Section 6 shall apply to all Incentive Stock Options granted under this
Plan.

         6.1 Stock Ownership Limitation. In the case of an Incentive Stock
Option, the Award Agreement shall include provisions that may be necessary to
assure that the option is an incentive stock option under the Code. No Incentive
Stock Option may be granted to an employee who owns more than 10% of the total
combined voting powers of all classes of stock of the Corporation or its
Subsidiaries. This limitation will not apply if the option price is at least
110% of the fair market value of the Stock on the Date of Grant and the
Incentive Stock Option is not exercisable more than five years from the Date of
Grant.

         6.2 Option Period. Notwithstanding the provisions of Section 5.3
hereof, if a Key Person owns or is deemed to own (by reason of the attribution
rules of Section 424(d) of the Code) more than 10% of the combined voting power
of all classes of stock of the Corporation (or any subsidiary of the
Corporation) and an Incentive Stock Option is granted to such employee, the term
of such Incentive Stock Option (to the extent required by the Code at the time
of grant) shall be no more than five years from the Date of Grant.

         6.3 Limitation on Exercise of Incentive Stock Options. To the extent
required by the Code for incentive stock options, the exercise of Incentive
Stock Options granted under the Plan shall be subject to the $100,000 calendar
year limit as set forth in Section 422(d) of the Code.

         6.4 Disqualifying Disposition. If Stock acquired upon exercise of an
Incentive Stock Option is disposed of by a Holder prior to the expiration of
either two years from the Date of Grant of such option or one year from the
transfer of shares to the Holder pursuant to the exercise of such option, or in
any other disqualifying disposition within the meaning of Section 422 of the
Code, such Holder shall notify the Corporation in writing of the date and terms
of



                                      -9-
<PAGE>   10

such disposition. A disqualifying disposition by a Holder shall not affect the
status of any other option granted under the Plan as an incentive stock option
within the meaning of Section 422 of the Code.

SECTION 7.  ADJUSTMENT PROVISIONS

         7.1 Adjustment of Awards and Authorized Stock or Class B Stock. The
terms of an Award and the number of shares of Stock or Class B Stock, as the
case may be, authorized pursuant to Paragraph 2.1 for issuance under the Plan
shall be subject to adjustment, from time to time, in accordance with the
following provisions:
                  (a) If at any time or from time to time, the Corporation shall
         subdivide as a whole (by reclassification, by a split of Stock or Class
         B Stock, as the case may be, by the issuance of a distribution on Stock
         or Class B Stock, as the case may be, payable in Stock or Class B
         Stock, as the case may be, or otherwise) the number of shares of Stock
         or Class B Stock, as the case may be, then outstanding into a greater
         number of shares of Stock or Class B Stock, as the case may be, then
         (i) the maximum number of shares of Stock or Class B Stock, as the case
         may be, available for the Plan as provided in Paragraph 2.1 shall be
         increased proportionately, and the kind of shares or other securities
         available for the Plan shall be appropriately adjusted, (ii) the number
         of shares of Stock or Class B Stock, as the case may be, (or other kind
         of shares or securities) that may be acquired under any Award shall be
         increased proportionately, and (iii) the price (including Exercise
         Price) for each share of Stock or Class B Stock, as the case may be,
         (or other kind of shares or unit of other securities) subject to then
         outstanding Awards shall be reduced proportionately, without changing
         the aggregate purchase price or value as to which outstanding Awards
         remain exercisable or subject to restrictions.

                  (b) If at any time or from time to time, the Corporation shall
         consolidate as a whole (by reclassification, reverse split of Stock or
         Class B Stock, as the case may be, or otherwise) the number of shares
         of Stock or Class B Stock, as the case may be, then outstanding into a
         lesser number of shares of Stock or Class B Stock, as the case may be,
         (i) the maximum number of shares of Stock or Class B Stock, as the case
         may be, available for the Plan as provided in Paragraph 2.1 shall be
         decreased proportionately, and the kind of shares or other securities
         available for the Plan shall be appropriately adjusted, (ii) the number
         of shares of Stock or Class B Stock, as the case may be (or other kind
         of shares or securities), that may be acquired under any Award shall be
         decreased proportionately, and (iii) the price (including Exercise
         Price) for each share of Stock or Class B Stock, as the case may be (or
         other kind of shares or unit of other securities), subject to then
         outstanding Awards shall be increased proportionately, without changing
         the aggregate purchase price or value as to which outstanding Awards
         remain exercisable or subject to restrictions.

                  (c) Whenever the number of shares of Stock or Class B Stock,
         as the case may be, subject to outstanding Awards and the price for
         each share of Stock or Class B Stock, as the case may be, subject to
         outstanding Awards are required to be adjusted as provided in this
         Paragraph 7.1, the Committee shall promptly prepare a notice setting
         forth, in reasonable detail, the event requiring adjustment, the amount
         of the adjustment, the method by which such adjustment was calculated,
         and the change in price and the number of shares of Stock or Class B
         Stock, as the case may be, other securities, cash, or property
         purchasable subject to each Award after giving effect to the
         adjustments.
         The Committee shall promptly give each Holder such a notice.

                  (d) Adjustments under subparagraphs 7.1(a) and (b) shall be
         made by the Committee, and its determination as to what adjustments
         shall be made and the extent thereof shall be final, binding, and
         conclusive. No fractional interest shall be issued under the Plan on
         account of any such adjustments.

         7.2 Changes in Control. Any Award Agreement may provide that, upon the
occurrence of a Change in Control, all outstanding Options shall immediately
become fully vested and exercisable in full, including that portion of any
Option that pursuant to the terms and provisions of the applicable Award
Agreement had not yet become



                                      -10-
<PAGE>   11

exercisable (the total number of shares of Stock or Class B Stock, as the case
may be, as to which an Option is exercisable upon the occurrence of a Change in
Control is referred to herein as the "Total Shares"). If a Change in Control
involves a Restructure or occurs in connection with a series of related
transactions involving a Restructure and if such Restructure is in the form of a
Non-Surviving Event and as a part of such Restructure shares of stock, other
securities, cash, or property shall be issuable or deliverable in exchange for
Stock or Class B Stock, as the case may be, then the Holder of an Award shall be
entitled to purchase (in lieu of the Total Shares that the Holder would
otherwise be entitled to purchase) the number of shares of stock, other
securities, cash, or property to which that number of Total Shares would have
been entitled in connection with such Restructure (and at an aggregate exercise
price equal to the Exercise Price that would have been payable if that number of
Total Shares had been purchased on the exercise of the Option immediately before
the consummation of the Restructure). Nothing in this Paragraph 7.2 shall impose
on a Holder the obligation to exercise any Award immediately before or upon the
Change of Control, nor shall the Holder forfeit the right to exercise the Award
during the remainder of the original term of the Award because of a Change in
Control or because the Holder's employment is terminated for any reason
following a Change in Control.

         7.3 Restructure and No Change in Control. In the event a Restructure
should occur at any time while there is any outstanding Award hereunder and that
Restructure does not occur in connection with a Change in Control or in
connection with a series of related transactions involving a Change in Control,
then:

                  (a) no outstanding Option shall immediately become fully
         vested and exercisable in full merely because of the occurrence of the
         Restructure; and

                  (b) at the option of the Committee, the Corporation may (but
         shall not be required to) take any one or more of the following
         actions:

                           (i) accelerate in whole or in part the time of the
                  vesting and exercisability of any one or more of the
                  outstanding Options so as to provide that those Options shall
                  be exercisable before, upon, or after the consummation of the
                  Restructure;

                           (ii) if the Restructure is in the form of a
                  Non-Surviving Event, cause the surviving entity to assume in
                  whole or in part any one or more of the outstanding Awards
                  upon such terms and provisions as the Committee deems
                  desirable; or

                           (iii) redeem in whole or in part any one or more of
                  the outstanding Awards (whether or not then exercisable) in
                  consideration of a cash payment, as such payment may be
                  reduced for tax withholding obligations as contemplated in
                  Paragraph 5.8 in an amount equal to the excess of (1) the Fair
                  Market Value, determined as of a date immediately preceding
                  the consummation of the Restructure, of the aggregate number
                  of shares of Stock or Class B Stock, as the case may be,
                  subject to the Award and as to which the Award is being
                  redeemed over (2) the Exercise Price for that number of shares
                  of Stock or Class B Stock, as the case may be;

The Corporation shall promptly notify each Holder of any election or action
taken by the Corporation under this Paragraph 7.3. In the event of any election
or action taken by the Corporation pursuant to this Paragraph 7.3 that requires
the amendment or cancellation of any Award Agreement as may be specified in any
notice to the Holder thereof, that Holder shall promptly deliver that Award
Agreement to the Corporation in order for that amendment or cancellation to be
implemented by the Corporation and the Committee. The failure of the Holder to
deliver any such Award Agreement to the Corporation as provided in the preceding
sentence shall not in any manner effect the validity or enforceability of any
action taken by the Corporation and the Committee under this Paragraph 7.3,
including, without limitation, any redemption of an Award as of the consummation
of a Restructure. Any cash payment to be made by the Corporation pursuant to
this Paragraph 7.3 in connection with the redemption of any outstanding Awards
shall be paid to the Holder thereof currently with the delivery to the
Corporation of the Award Agreement evidencing that Award; 




                                      -11-
<PAGE>   12

provided, however, that any such redemption shall be effective upon the
consummation of the Restructure notwithstanding that the payment of the
redemption price may occur subsequent to the consummation. If all or any portion
of an outstanding Award is to be exercised or accelerated to upon or after the
consummation of a Restructure that is in the form of a Non-Surviving Event and
as a part of that Restructure shares of stock, other securities, cash, or
property shall be issuable or deliverable in exchange for Stock or Class B
Stock, as the case may be, then the Holder of the Award shall thereafter be
entitled to purchase (in lieu of the number of shares of Stock or Class B Stock,
as the case may be, that the Holder would otherwise be entitled to purchase) the
number of shares of stock, other securities, cash, or property to which such
number of shares of Stock or Class B Stock, as the case may be, would have been
entitled in connection with the Restructure (and, for Options, at an aggregate
exercise price equal to the Exercise Price that would have been payable if that
number of Total Shares had been purchased on the exercise of the Option
immediately before the consummation of the Restructure).

      7.4 Notice of Change in Control or Restructure. The Corporation shall
attempt to keep all Holders informed with respect to any Change in Control or
Restructure or of any potential Change in Control or Restructure to the same
extent that the Corporation's stockholders are informed by the Corporation of
any such event or potential event.

SECTION 8.  ADDITIONAL PROVISIONS

      8.1 Loss of Eligibility. If a Holder is a key person because the Holder is
serving in a capacity other than as a director and if that capacity is
terminated for any reason other than the Holder's death, retirement, or
disability, then any and all Awards held by the Holder as of the date of the
termination that were granted because of that capacity shall be exercisable by
that Holder for a period of the lesser of (a) the remainder of the term of the
Award or (b) 210 days following the date of the Holder's termination. Despite a
Holder's termination, each Option that is scheduled to vest during the period
specified in (a) or (b) in the preceding sentence, as applicable, shall vest;
however, each such Option shall expire at the same time that all other Awards
expire pursuant to (a) or (b) in the preceding sentence, as applicable. Any
portion of an Award not exercised upon the expiration of the periods specified
in (a) or (b) shall be null and void. However, in the event the termination of
the Holder is for dishonesty or other acts detrimental to the interests of the
Corporation or its subsidiaries, or if after termination, the Holder commits
acts that are detrimental to the interests of the Corporation as determined by
its Stock Option Committee, all Awards held by such Holder shall become null and
void at and after the time such determination is made.

      8.2 Other Loss of Eligibility. If a Holder is an Eligible Individual
because the Holder is serving in a capacity other than as an employee and if
that capacity is terminated for any reason other than the Holder's death, then
any and all Awards held by the Holder that were granted because of that capacity
as of the date of the termination shall become null and void as of the date of
the termination.

      8.3 Death. Upon the death of a Holder, then any and all Awards held by the
Holder that are not yet exercisable as of the date of the Holder's death shall
become null and void as of the date of death; provided, however, that the
portion, if any, of any and all Awards held by the Holder that are exercisable
as of the date of death shall be exercisable by that Holder's legal
representatives, legatees or distributees for a period of the lesser of (a) the
remainder of the term of the Award or (b) 210 days following the date of the
Holder's death. Any portion of an Award not exercised upon the expiration of the
periods specified in (a) or (b) shall be null and void. Except as expressly
provided in this Paragraph 8.3, no Award held by a Holder shall be exercisable
after the death of that Holder.

      8.4 Retirement. If a Holder is an Eligible Individual because the Holder
is an employee and if that employment relationship is terminated by reason of
the Holder's Normal Retirement, then the portion, if any, of any and all Awards
held by the Holder that are not yet exercisable as of the date of that
retirement shall become null and void as of the date of retirement; provided,
however, that the portion, if any, of any and all Awards held by the Holder that
are exercisable as of the date of that retirement shall be exercisable for a
period of the lesser of (a) the remainder of the term of the Award or (b) 90
days following the date of retirement.



                                      -12-
<PAGE>   13

      8.5 Disability. If a Holder is an Eligible Individual because the Holder
is an Employee and if that employment relationship is terminated by reason of
the Holder's Disability, then the portion, if any, of any and all Awards held by
the Holder that are not yet exercisable as of the date of that termination for
Disability shall become null and void as of the date of termination; provided,
however, that the portion, if any, of any and all Awards held by the Holder that
are exercisable as of the date of that termination shall survive the termination
for the lesser of (a) the original term of the Award and (b) 210 days following
the date of termination, and the Award shall be exercisable by the Holder, his
guardian, or his legal representative. "Disability" shall have the meaning given
it in the employment agreement of the Holder; provided, however, that if that
Holder has no employment agreement, "Disability" shall mean a physical or mental
impairment of sufficient severity that, in the opinion of the Corporation,
either the Holder is unable to continue performing the duties he performed
before such impairment or the Holder's condition entitles him to disability
benefits under any insurance or employee benefit plan of the Corporation or its
Subsidiaries and that impairment or condition is cited by the Corporation as the
reason for termination of the Holder's employment.

      8.6 Leave of Absence. With respect to an Award, the Committee may, in its
sole discretion, determine that any Holder who is on leave of absence for any
reason will be considered to still be in the employ of the Corporation, provided
that rights to that Award during a leave of absence will be limited to the
extent to which those rights were earned or vested when the leave of absence
began.

      8.7 Transferability of Awards. In addition to such other terms and
conditions as may be included in a particular Award Agreement, an Award
requiring exercise shall be exercisable during a Holder's lifetime only by that
Holder or by that Holder's guardian or legal representative. An Award requiring
exercise shall not be transferable other than by will or the laws of descent and
distribution.

      8.8 Forfeiture and Restrictions on Transfer. Each Award Agreement may
contain or otherwise provide for conditions giving rise to the forfeiture of the
Stock or Class B Stock, as the case may be, acquired pursuant to an Award or
otherwise and may also provide for those restrictions on the transferability of
shares of the Stock or Class B Stock, as the case may be, acquired pursuant to
an Award or otherwise that the Committee in its sole and absolute discretion may
deem proper or advisable. The conditions giving rise to forfeiture may include,
but need not be limited to, the requirement that the Holder render substantial
services to the Corporation or its Subsidiaries for a specified period of time.
The restrictions on transferability may include, but need not be limited to,
options and rights of first refusal in favor of the Corporation and stockholders
of the Corporation other than the Holder of such shares of Stock or Class B
Stock, as the case may be, who is a party to the particular Award Agreement or a
subsequent holder of the shares of Stock or Class B Stock, as the case may be,
who is bound by that Award Agreement.

      8.9 Delivery of Certificates of Stock. Subject to Paragraph 8.10, the
Corporation shall promptly issue and deliver a certificate representing the
number of shares of Stock or Class B Stock, as the case may be, as to which an
Option has been exercised after the Corporation receives an Exercise Notice and
upon receipt by the Corporation of the Exercise Price and any tax withholding as
may be requested. The value of the shares of Stock or Class B Stock, as the case
may be, transferable because of an Award under the Plan shall not bear any
interest owing to the passage of time, except as may be otherwise provided in an
Award Agreement. If a Holder is entitled to receive certificates representing
Stock or Class B Stock, as the case may be, received for more than one form of
Award under the Plan, separate certificates of Stock or Class B Stock, as the
case may be, shall be issued with respect to Incentive Options and Nonstatutory
Stock Options separately.

      8.10 Conditions to Delivery of Stock. Nothing herein or in any Award
granted hereunder or any Award Agreement shall require the Corporation to issue
any shares with respect to any Award if that issuance would, in the opinion of
counsel for the Corporation, constitute a violation of the Securities Act or any
similar or superseding statute or statutes, any other applicable statute or
regulation, or the rules of any applicable securities exchange or securities
association, as then in effect. At the time of any exercise of an Option, the
Corporation may, as a condition precedent 



                                      -13-
<PAGE>   14

to the exercise of such Option, require from the Holder of the Award (or in the
event of his death, his legal representatives, heirs, legatees, or distributees)
such written representations, if any, concerning the Holder's intentions with
regard to the retention or disposition of the shares of Stock or Class B Stock,
as the case may be, being acquired pursuant to the Award and such written
covenants and agreements, if any, as to the manner of disposal of such shares
as, in the opinion of counsel to the Corporation, may be necessary to ensure
that any disposition by that Holder (or in the event of the Holder's death, his
legal representatives, heirs, legatees, or distributees), will not involve a
violation of the Securities Act or any similar or superseding statute or
statutes, any other applicable state or federal statute or regulation, or any
rule of any applicable securities exchange or securities association, as then in
effect.

      8.11 Certain Directors and Officers. With respect to Holders who are
directors or officers of the Corporation or any Subsidiary and who are subject
to Section 16(b) of the Exchange Act, and if Rule 16b-3 requires the following
conditions at the time of the Award, Awards and all rights under the Plan,
contingent or otherwise, shall be exercisable during the Holder's lifetime only
by the Holder or the Holder's guardian or legal representative, but not for at
least six months after grant, unless death or Disability of the Holder occurs
before the expiration of the six-month period. In addition, no such officer or
director shall use shares to pay tax withholding obligations within the first
six months of the term of the Award. Any election by any such officer or
director to have tax withholding obligations satisfied by the withholding of
shares of Stock or Class B Stock, as the case may be, shall be irrevocable and
shall be communicated to the Committee during the period beginning on the third
day following the date of release of quarterly or annual summary statements of
sales and earnings and ending on the twelfth business day following such date
(the "Window Period") or by an irrevocable election communicated to the
Committee at least six months before the date of exercise of the Award for which
such withholding is desired.

      8.12 Securities Act Legend. Certificates for shares of Stock or Class B
Stock, as the case may be, when issued, may have the following legend, or
statements of other applicable restrictions, endorsed thereon, and may not be
immediately transferable:

      THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
      SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED,
      TRANSFERRED, OR OTHERWISE DISPOSED OF UNTIL THE HOLDER HEREOF PROVIDES
      EVIDENCE SATISFACTORY TO THE ISSUER (WHICH, IN THE DISCRETION OF THE
      ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER) THAT
      SUCH OFFER, SALE, PLEDGE, TRANSFER, OR OTHER DISPOSITION WILL NOT VIOLATE
      APPLICABLE FEDERAL OR STATE LAWS.

This legend shall not be required for shares of Stock or Class B Stock, as the
case may be, issued pursuant to an effective registration statement under the
Securities Act.

      8.13 Legend for Restrictions on Transfer. Each certificate representing
shares issued to a Holder pursuant to an Award granted under the Plan shall, if
such shares are subject to any transfer restriction, including a right of first
refusal, provided for under this Plan or an Award Agreement, bear a legend that
complies with applicable law with respect to the restrictions on transferability
contained in this Paragraph 8.13, such as:

      THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
      RESTRICTIONS ON TRANSFERABILITY IMPOSED BY THAT CERTAIN INSTRUMENT
      ENTITLED "THOMAS GROUP, INC. 1992 STOCK OPTION PLAN" AS ADOPTED BY THOMAS
      GROUP, INC. (THE "CORPORATION") ON MARCH 16, 1992 AS AMENDED, AND AN
      AGREEMENT THEREUNDER BETWEEN THE CORPORATION AND [HOLDER] DATED , 199 ,
      AND MAY NOT BE TRANSFERRED, SOLD, OR OTHERWISE DISPOSED OF EXCEPT AS
      THEREIN PROVIDED. THE CORPORATION WILL FURNISH A COPY OF SUCH INSTRUMENT
      AND AGREEMENT TO THE RECORD HOLDER OF THIS




                                      -14-
<PAGE>   15

      CERTIFICATE WITHOUT CHARGE ON REQUEST TO THE CORPORATION AT ITS PRINCIPAL
      PLACE OF BUSINESS OR REGISTERED OFFICE.

      8.14 Rights as a Stockholder. A Holder shall have no right as a
stockholder with respect to any shares covered by his Award until a certificate
representing those shares is issued in his name. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash or other property) or
distributions or other rights for which the record date is before the date that
certificate is issued, except as contemplated by Section 7. Nevertheless,
dividends and dividend equivalent rights may be extended to and made part of any
Award denominated in Stock or Class B Stock, as the case may be, or units of
Stock or Class B Stock, as the case may be, subject to such terms, conditions,
and restrictions as the Committee may establish. The Committee may also
establish rules and procedures for the crediting of interest on deferred cash
payments and dividend equivalents for deferred payment denominated in Stock or
Class B Stock, as the case may be, or units of Stock or Class B Stock, as the
case may be.

      8.15 Furnish Information. Each Holder shall furnish to the Corporation all
information requested by the Corporation to enable it to comply with any
reporting or other requirement imposed upon the Corporation by or under any
applicable statute or regulation.

      8.16 Obligation to Exercise. The granting of an Award hereunder shall
impose no obligation upon the Holder to exercise the same or any part thereof.

      8.17 Adjustments to Awards. Subject to the general limitations set forth
in Sections 5 and 7, the Committee may make any adjustment in the exercise price
of, the number of shares subject to or the terms of an Option by cancelling an
outstanding Option and regranting an Option. Such adjustment shall be made by
amending, substituting, or regranting an outstanding Option. Such amendment,
substitution, or regrant may result in terms and conditions that differ from the
terms and conditions of the original Option. The Committee may not, however,
impair the rights of any Holder to previously granted Options without that
Holder's consent. If such action is effected by amendment, the effective date of
such amendment shall be the date of the original grant.

      8.18 Remedies. The Corporation shall be entitled to recover from a Holder
reasonable attorneys' fees incurred in connection with the enforcement of the
terms and provisions of the Plan and any Award Agreement whether by an action to
enforce specific performance or for damages for its breach or otherwise.

      8.19 Information Confidential. As partial consideration for the granting
of each Award hereunder, the Holder shall agree with the Corporation that he
will keep confidential all information and knowledge that he has relating to the
manner and amount of his participation in the Plan; provided, however, that such
information may be disclosed as required by law and may be given in confidence
to the Holder's spouse, tax and financial advisors, or to a financial
institution to the extent that such information is necessary to secure a loan.
In the event any breach of this promise comes to the attention of the Committee,
it shall take into consideration that breach in determining whether to recommend
the grant of any future Award to that Holder, as a factor militating against the
advisability of granting any such future Award to that individual.

      8.20 Consideration. No Option shall be exercisable with respect to a
Holder unless and until the Holder shall have paid cash or property to, or
performed services for, the Corporation or any of its Subsidiaries that the
Committee believes is equal to or greater in value that the par value of the
Stock or Class B Stock, as the case may be, subject to such Award.



                                      -15-
<PAGE>   16

SECTION 9.  DURATION AND AMENDMENT OF PLAN

      9.1 Duration. No Awards may be granted hereunder after the date that is
ten (10) years from the earlier of (a) the date the Plan was originally adopted
by the Board of Directors and (b) the date the Plan is approved by the
stockholders of the Corporation.

      9.2 Amendment. The Board of Directors may, insofar as permitted by law,
with respect to any shares which, at the time, are not subject to Awards,
suspend, or discontinue the Plan or revise or amend it in any respect
whatsoever. The Board of Directors may not alter, amend, revise, suspend or
discontinue the Plan without obtaining approval of the Corporation's
stockholders if such action would (i) materially increase the benefits accruing
to Holders under the Plan, (ii) materially increase the number of securities
which may be issued under the Plan, or (iii) materially modify the requirements
as to eligibility for participation in the Plan. The Board of Directors may also
amend, modify, suspend, or terminate the Plan for the purpose of meeting or
addressing any changes in other legal requirements applicable to the Corporation
or the Plan or for any other purpose permitted by law.

SECTION 10.  GENERAL

      10.1 Application of Funds. The proceeds received by the Corporation from
the sale of shares pursuant to Awards may be used for any general corporate
purpose.

      10.2 No Liability for Good Faith Determinations. Neither the members of
the Board of Directors nor any member of the Committee shall be liable for any
act, omission, or determination taken or made in good faith with respect to the
Plan or any Award granted under it, and members of the Board of Directors and
the Committee shall be entitled to indemnification and reimbursement by the
Corporation in respect of any claim, loss, damage, or expense (including
attorneys' fees, the costs of settling any suit, provided such settlement is
approved by independent legal counsel selected by the Corporation, and amounts
paid in satisfaction of a judgment, except a judgment based on a finding of bad
faith) arising therefrom to the full extent permitted by law and under any
directors and officers liability or similar insurance coverage that may from
time to time be in effect. This right to indemnification shall be in addition
to, and not a limitation on, any other indemnification rights any member of the
Board of Directors or the Committee may have.

      10.3 Other Benefits. Participation in the Plan shall not preclude the
Holder from eligibility in any other stock or stock option plan of the
Corporation or any Subsidiary or any old age benefit, insurance, pension, profit
sharing retirement, bonus, or other extra compensation plans that the
Corporation or any Subsidiary has adopted, or may, at any time, adopt for the
benefit of its Employees. Neither the adoption of the Plan by the Board of
Directors nor the submission of the Plan to the stockholders of the Corporation
for approval shall be construed as creating any limitations on the power of the
Board of Directors to adopt such other incentive arrangements as it may deem
desirable, including, without limitation, the granting of stock options and the
awarding of stock and cash otherwise than under the Plan, and such arrangements
may be either generally applicable or applicable only in specific cases.

      10.4 Exclusion From Pension and Profit-Sharing Compensation. By acceptance
of an Award (whether in Stock or cash), as applicable, each Holder shall be
deemed to have agreed that the Award is special incentive compensation that will
not be taken into account in any manner as salary, compensation, or bonus in
determining the amount of any payment under any pension, retirement, or other
employee benefit plan of the Corporation or any Subsidiary. In addition, each
beneficiary of a deceased Holder shall be deemed to have agreed that the Award
will not affect the amount of any life insurance coverage, if any, provided by
the Corporation or a Subsidiary on the life of the Holder that is payable to the
beneficiary under any life insurance plan covering employees of the Corporation
or any Subsidiary.



                                      -16-
<PAGE>   17

      10.5 Execution of Receipts and Releases. Any payment of cash or any
issuance or transfer of shares of Stock or Class B Stock, as the case may be, to
the Holder, or to his legal representative, heir, legatee, or distributee, in
accordance with the provisions hereof, shall, to the extent thereof, be in full
satisfaction of all claims of such persons hereunder. The Committee may require
any Holder, legal representative, heir, legatee, or distributee, as a condition
precedent to such payment, to execute a release and receipt therefor in such
form as it shall determine.

      10.6 Unfunded Plan. Insofar as it provides for Awards of cash and Stock or
Class B Stock, as the case may be, the Plan shall be unfunded. Although
bookkeeping accounts may be established with respect to Holders who are entitled
to cash, Stock or Class B Stock, as the case may be, or rights thereto under the
Plan, any such accounts shall be used merely as a bookkeeping convenience. The
Corporation shall not be required to segregate any assets that may at any time
be represented by cash, Stock or Class B Stock, as the case may be, or rights
thereto, nor shall the Plan be construed as providing for such segregation, nor
shall the Corporation nor the Board of Directors nor the Committee be deemed to
be a trustee of any cash, Stock or Class B Stock, as the case may be, or rights
thereto to be granted under the Plan. Any liability of the Corporation to any
Holder with respect to a grant of cash, Stock or Class B Stock, as the case may
be, or rights thereto under the Plan shall be based solely upon any contractual
obligations that may be created by the Plan and any Award Agreement; no such
obligation of the Corporation shall be deemed to be secured by any pledge or
other encumbrance on any property of the Corporation. Neither the Corporation
nor the Board of Directors 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.

      10.7 No Guarantee of Interests. Neither the Committee nor the Corporation
guarantees the Stock or Class B Stock, as the case may be, of the Corporation
from loss or depreciation.

      10.8 Payment of Expenses. All expenses incident to the administration,
termination, or protection of the Plan, including, but not limited to, legal and
accounting fees, shall be paid by the Corporation or its Subsidiaries; provided,
however, the Corporation or a Subsidiary may recover any and all damages, fees,
expenses, and costs arising out of any actions taken by the Corporation to
enforce its right to purchase Stock or Class B Stock, as the case may be, under
this Plan.

      10.9 Corporation Records. Records of the Corporation or its Subsidiaries
regarding the Holder's period of employment, termination of employment and the
reason therefor, leaves of absence, re-employment, and other matters shall be
conclusive for all purposes hereunder, unless determined by the Committee to be
incorrect.

      10.10 Information. The Corporation and its Subsidiaries shall, upon
request or as may be specifically required hereunder, furnish or cause to be
furnished, all of the information or documentation which is necessary or
required by the Committee to perform its duties and functions under the Plan.

      10.11 No Liability of Corporation. The Corporation assumes no obligation
or responsibility to the Holder or his legal representatives, heirs, legatees,
or distributees for any act of, or failure to act on the part of, the Committee.

      10.12 Corporation Action. Any action required of the Corporation shall be
by resolution of its Board of Directors or by a person authorized to act by
resolution of the Board of Directors.

      10.13 Severability. If any provision of this Plan is held to be illegal or
invalid for any reason, the illegality or invalidity shall not affect the
remaining provisions hereof, but such provision shall be fully severable and the
Plan shall be construed and enforced as if the illegal or invalid provision had
never been included herein.

      10.14 Notices. Whenever any notice is required or permitted hereunder,
such notice must be in writing and personally delivered or sent by mail. Any
notice required or permitted to be delivered hereunder shall be deemed to be
delivered on the date on which it is personally delivered, or, whether actually
received or not, on the third Business Day 



                                      -17-
<PAGE>   18

after it is deposited in the United States mail, certified or registered,
postage prepaid, addressed to the person who is to receive it at the address
which such person has theretofore specified by written notice delivered in
accordance herewith. The Corporation or a Holder may change, at any time and
from time to time, by written notice to the other, the address which it or he
had previously specified for receiving notices. Until changed in accordance
herewith, the Corporation and each Holder shall specify as its and his address
for receiving notices the address set forth in the Award Agreement pertaining to
the shares to which such notice relates.

      10.15 Waiver of Notice. Any person entitled to notice hereunder may waive
such notice.

      10.16 Successors. The Plan shall be binding upon the Holder, his legal
representatives, heirs, legatees, and distributees, upon the Corporation, its
successors, and assigns, and upon the Committee, and its successors.

      10.17 Headings. The titles and headings of Sections and Paragraphs are
included for convenience of reference only and are not to be considered in
construction of the provisions hereof.

      10.18 Governing Law. All questions arising with respect to the provisions
of the Plan shall be determined by application of the laws of the State of
Delaware except to the extent Delaware law is preempted by federal law.
Questions arising with respect to the provisions of an Award Agreement that are
matters of contract law shall be governed by the laws of the state specified in
the Award Agreement, except to the extent Delaware corporate law conflicts with
the contract law of such state, in which event Delaware corporate law shall
govern. The obligation of the Corporation to sell and deliver Stock hereunder is
subject to applicable laws and to the approval of any governmental authority
required in connection with the authorization, issuance, sale, or delivery of
such Stock.

      10.19 Word Usage. Words used in the masculine shall apply to the feminine
where applicable, and wherever the context of this Plan dictates, the plural
shall be read as the singular and the singular as the plural.

      IN WITNESS WHEREOF, Thomas Group, Inc., acting by and through its officer
hereunto duly authorized, has executed this instrument, this the day of , 1995.

                                      THOMAS GROUP, INC.


                                      By:
                                         ----------------------------------
                                         President




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