Exhibit 10.28


                              EMPLOYMENT AGREEMENT


     EMPLOYMENT  AGREEMENT  dated June 10, 1998 between HAGLER  BAILLY,  INC., a
Delaware corporation ("Company"), and HENRI-CLAUDE BAILLY ("Executive").

     WHEREAS,  Executive is currently  the Chairman of the Board,  President and
Chief Executive Officer of the Company;

     WHEREAS,  Executive  is  currently  a  party  to an  Amended  and  Restated
Employment  Agreement dated July 3, 1997 ("Amended and Restated Agreement") with
the Company;

     WHEREAS, pursuant to that certain Agreement and Plan of Merger (the "Merger
Agreement") dated as of the date hereof among PUTNAM, HAYES & BARTLETT,  INC., a
Massachusetts   corporation  ("PHB"),  the  Company  and  PHB  MERGER  CORP.,  a
Massachusetts  corporation and  wholly-owned  subsidiary of the Company ("Merger
Sub"),  Merger  Sub will  merge  with and into PHB (the  "Merger"),  PHB will be
renamed PHB Hagler Bailly,  Inc.  ("PHB Hagler  Bailly") and the common stock of
PHB, including the common stock of PHB owned by the Executive, will be converted
into shares of common stock of the Company ("Common Stock");

     WHEREAS, as a result of the Merger, the Company anticipates changes in
the management of the Company which are  inconsistent  with certain terms in the
Amended and Restated Agreement;

     WHEREAS,  in  consideration of the compensation and benefits to be afforded
to Executive  pursuant to this  Agreement,  Executive  has agreed to execute and
deliver this  Agreement and to terminate,  effective as of the effective time of
the Merger, any prior employment agreements or arrangements with the Company;

     WHEREAS, the Company desires to employ Executive,  and Executive desires to
be employed by the Company, from the day after the effective time of the Merger,
on the terms and conditions set forth herein.

     Whereas,  Executive agrees to be bound by the confidentiality,  non-compete
and non-solicitation provisions herein;

     WHEREAS,  the Board of  Directors  of the Company has approved the terms of
this Agreement;

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained,  the Company and Executive,  intending to be legally bound,  agree as
follows:



     1. Employment, Term, Duties and Responsibilities.

     a. During the Term (as hereinafter defined) of this Agreement,  the Company
agrees to employ  Executive and Executive agrees to serve as President and Chief
Executive  Officer of the Company  through  December 31, 1999.  As of January 1,
2000,  Executive  shall  become  Chairman  of the Board of the  Company and will
perform such other duties assigned to him by the Chief Executive Officer and the
Board of  Directors  of the  Company  (the  "Company  Board")  and  agreed to by
Executive.  In the event that  Executive  shall elect to resign from the Company
Board,  Executive shall continue as a full-time executive officer of the Company
performing  such duties as the Chief  Executive  Officer,  the Company Board and
Executive  shall  mutually  agree.  As of January 1, 2000, in his capacity as an
executive  officer of the Company,  Executive will report  directly to the Chief
Executive Officer of the Company.

     During the Term,  Executive  agrees to serve Company  faithfully and to the
best of his ability;  to devote his entire time, energy and skill during regular
business hours (except for illness or incapacity and except for vacation time as
provided herein) to such employment; to use his best efforts, skills and ability
to promote its interests;  if elected, to serve as a director of Company and its
subsidiaries or affiliated  corporations or entities; and to perform such duties
as from time to time may be assigned to him, subject to the preceding  paragraph
hereof.

     Notwithstanding the foregoing, Executive may engage in charitable, academic
and public and industry  service  activities  so long as such  activities do not
materially  interfere with the  performance  of his duties and  responsibilities
under this Agreement.

     b. Subject to the  provisions of this  Agreement to the contrary,  the Term
shall commence on the closing date of the Merger (the "Effective Time"), and end
on July 3, 2000.

     2. Compensation.

     The  Company  agrees  to pay  Executive  as  compensation  for  all  duties
performed by him in any capacity during the period of his employment  under this
Agreement:

     a. An annual  base  salary  ("Base  Salary")  payable  in equal  bi-monthly
installments  at an initial annual rate of $393,750  commencing at the Effective
Time. On January 1 of each year during the Term commencing  January 1, 1999, the
annual rate of Base Salary shall be increased by no less than the greater of (i)
five  percent  (5%)  over the  annual  rate of Base  Salary  in  effect  for the
preceding year, and (ii) the increase in the CPI National Index for the year. b.
An annual bonus  payment  ("Bonus"),  in an amount,  if any,  determined  by the
Compensation Committee of the Company Board.

     c. From time to time,  Executive  shall also be eligible to receive options
to  purchase  Common  Stock of the  Company  pursuant to the terms of the Hagler
Bailly Employee  Incentive and  Non-Qualified  Stock Option and Restricted Stock
Plan or any successor Plan, and in the amounts determined by, and subject to the
terms and  conditions of, the Stock Option  Committee of the Company  Board.  d.
During the Term,  for so long as Executive  is a member of the Company  Board or
the  board of  directors  of any of the  Company's  subsidiaries  or  affiliated
companies,   Executive  shall  receive  such  compensation  and  other  benefits
(including  insurance coverage and  indemnification) as other similarly situated
members of such board of directors receive for their service in such capacity.

     3. Benefits; Reimbursement of Expenses; Annual Physical.

     Executive shall also be entitled to:

          a.  participate  in all of the benefit  programs which are provided by
          the Company;

          b. reimbursement by the Company of all expenses reasonably incurred by
          him in  connection  with the  performance  of his  duties,  including,
          without  limitation,  travel  and  entertainment  expenses  reasonably
          related to the business or interests of the Company,  upon  submission
          by him of written documentation of such expenses; and

          c. a fully-paid annual physical examination.

          4. Disability or Death.

     a. If, during the Term of this  Agreement,  Executive  becomes  disabled or
incapacitated  for a period of twelve (12) consecutive  months to such an extent
that he is unable to perform his duties hereunder ("Permanently Disabled"),  the
Company  shall have the right at any time  thereafter,  so long as  Executive is
then still  Permanently  Disabled,  to terminate this Agreement.  If the Company
elects to terminate this Agreement by reason of Executive  becoming  Permanently
Disabled, the Company, for the unexpired Term of this Agreement,  shall continue
to pay:

     (1) to Executive,  sixty percent (60%) of his Base Salary (whether  through
insurance or otherwise)  at the rate in effect on the date of such  termination,
such payments to be made as set forth in Section 2 plus, within thirty (30) days
of such  termination,  a lump sum payment in the amount of the Executive's  Base
Salary at the date of such termination; or

     (2) in the event of Executive's  death after such termination for Permanent
Disability,  then to the persons and in the manner set forth in subparagraph (c)
of this  Section  4, an  amount  per  annum  equal  to  sixty  percent  (60%) of
Executive's Base Salary (whether through  insurance or otherwise) at the rate in
effect on the date this Agreement is terminated by the Company, such payments to
be made as set forth in Section 2.

     If, and so long as, the Company does not elect to terminate  this Agreement
as a result of Executive's Permanent  Disability,  this Agreement shall continue
in full  force and  effect  and  Executive  shall be  entitled  to all  benefits
provided under this Agreement including, without limitation, compensation as set
forth in Section 2.

     b.  If  the  Executive  dies  during  the  Term,   this   Agreement   shall
automatically terminate,  except that (i) for the unexpired portion of the Term,
the Company shall  continue to pay to the persons and in the manner set forth in
subparagraph  (c) of this Section 4, an amount per annum equal to sixty  percent
(60%) of  Executive's  Base Salary in effect on the date of  Executive's  death,
such  payments to be made as set forth in Section 2, and (ii) within thirty (30)
days of such termination,  the Company shall pay such persons a lump sum payment
Section  4a(2)) in the  amount  of the  Executive's  Base  Salary at the date of
termination.

     c. Any  payments  to be made  pursuant to  subparagraph  (a) or (b) of this
Section 4 to persons other than Executive in the event of the death of Executive
shall be made to Executive's designated beneficiaries or, if no such designation
has been made and Executive's spouse survives Executive, then the payments shall
be made to Executive's  spouse, and if such spouse  subsequently dies before all
such payments are made,  the remaining  payments  shall be made to the estate of
Executive's  spouse. If Executive is not survived by a spouse, then the payments
shall be made among Executive's issue who survive Executive, per stirpes, and if
any  individual  who is  issue of  Executive  and who as of the date of death of
Executive is entitled to receive  payments  dies after  Executive's  death,  the
payments  which such issue would have been  entitled to receive shall be made to
his or her estate. If at the date of Executive's death Executive is not survived
by any spouse,  or any issue,  then the  payments  shall be made to  Executive's
estate.

          5. Termination.

          This Agreement  shall terminate prior to the expiration of its Term as
          follows:

          a. Automatically upon Executive's death, in which event the provisions
          of Section 4 shall continue to be applicable;

          b. By the Company,  upon notice from the Company, in the event Company
          elects  to  terminate   Executive's   employment  due  to  Executive's
          Permanent Disability pursuant to the provisions of Section 4;

          c. By the Company,  for "cause,"  which for purposes of this Agreement
          shall mean:

               (i)  failure  to  comply  with  material   rules,   standards  or
               procedures  reasonably  promulgated  by the Company in accordance
               with ordinary and usual  business  standards,  or  dereliction of
               assigned  responsibilities  consistent with Section 1 above, such
               failure or dereliction  remaining uncured by Executive for thirty
               (30) days after receiving written notice from the Company of such
               failure or dereliction that specifically  describes the nature of
               such alleged failures;

               (ii)   substandard   performance  of  assigned   responsibilities
               measured in accordance  with  performance  standards  agreed upon
               from time to time by Executive and the Company;

               (iii) material violation by Executive, or any other person acting
               upon  his  specific  directions,  of a  federal,  state  or local
               statute,  rule or regulation  applicable  to the Company,  to its
               management, or to the operation of the Company's business;

               (iv) material breach of the terms of this Agreement;

               (v) knowing falsification of the Company's records or documents;

               (vi) gross negligence;

               (vii)  conviction by  Executive,  or any other person acting upon
               Executive's specific directions, of any misdemeanor that involves
               fraud or a material loss to the Company or of a felony; or

               (viii) any act of dishonesty or moral turpitude.

     The refusal to permanently  relocate from Executive's current place of work
will not constitute a "cause" for termination of employment by the Company.

     d. By Executive,  upon the  Company's  failure to perform or observe any of
the material terms or provisions of this Agreement, and the continued failure of
the Company to cure such default  within thirty (30) days after  written  demand
for performance  has been given to the Company by Executive,  which demand shall
describe  specifically  the nature of such alleged failure to perform or observe
such  material  terms or  provisions.  Without  limiting  the  foregoing,  it is
acknowledged  and agreed  that  Sections  1, 2, 3, and 4 of this  Agreement  are
material provisions of this Agreement.

     e. By Executive,  upon notice from Executive after Company's failure to pay
Executive  amounts under Sections 2 and 3 when due and the continued  failure of
the Company to make such payment  within ten (10) days after written  demand for
such payment is made by Executive.

     f. By Executive, upon notice from Executive following a "change in control"
(as defined in Section 17).

          6. Effect of Termination.

     a. In the event of the termination of this Agreement by Company pursuant to
paragraph  (c) of  Section  5, the  Company  shall be  under  no  obligation  to
Executive,  except to pay his accrued and unpaid Base  Salary,  Bonus,  and paid
leave  entitlements to the date of termination,  and to permit exercise pursuant
to the  Plan of any  vested  but  unexercised  options  Executive  shall  not be
entitled to receive any Base Salary or Bonus after the date of  termination,  or
to exercise any unvested options under the Plan.

     b. In the event of the termination of this Agreement by Executive  pursuant
to paragraphs  (d), (e) or (f) of Section 5, or in the event of the  termination
of this  Agreement by the Company other than pursuant to a notice of termination
under  paragraph (b) or (c) of Section 5,  Executive  shall receive from Company
(i) payments at an annual rate equal to his Base Salary in effect on the date of
such  termination in equal bimonthly  installments  until thirty-six (36) months
from the  effective  date of such  termination;  and (ii) a lump-sum  payment in
amount  equal  to four (4)  times  his Base  Salary  on the date of  termination
payable within thirty (30) days thereof.

     If the Company and Executive shall become involved in a dispute relating to
any  alleged  breach of this  Agreement  by the  Company  or  Executive,  and if
Executive prevails (by judgment,  settlement or otherwise) in such dispute,  the
Company shall reimburse Executive for all reasonable costs (including reasonable
fees and  disbursements  of  counsel)  incurred by him in  connection  with such
dispute upon presentation to the Company of evidence of such costs.

          7. Termination of Prior Agreements.

     This Agreement  expressly  supersedes  all  agreements  and  understandings
between the parties  regarding the subject  matter hereof and any such agreement
is terminated as of the closing date of the Merger.

          8. Binding Effect.

     This  Agreement  shall be  binding  upon and  inure to the  benefit  of the
parties hereto,  their respective legal  representatives and to any successor of
the Company,  which successor shall be deemed  substituted for the Company under
the terms of this  Agreement.  As used in this Agreement,  the term  "successor"
shall include any person,  firm,  corporation or other business  entity which at
any  time,   whether  by  merger,   purchase  or  otherwise,   acquires  all  or
substantially all of the assets or business of the Company.

          9. Waiver of Breach.

     The waiver by the Company of a breach of any provision of this Agreement by
Executive  shall not  operate  or be  construed  as a waiver  of any  subsequent
breach.

          10. Notices.

     Any notice required or permitted to be given hereunder shall be sufficient,
upon  acknowledgement of receipt, if in writing and if sent by facsimile message
or by  recognized  courier  to  Executive  at each of his  residences  or to the
Company at its principal place of business.

          11. Entire Agreement.

     This document  contains the entire  agreement of the parties and may not be
changed except in a writing signed by both parties.

          12. Governing Law.

     This  Agreement  shall be governed by and construed in accordance  with the
laws of the  Commonwealth  of  Virginia  as applied to  contracts  executed  and
performed wholly within the Commonwealth of Virginia.

          13. Confidentiality.

     a. From and after the  Effective  Time,  Executive  shall not,  without the
prior written consent of the Company Board,  for any reason,  either directly or
indirectly, divulge to any third-party or use for his or her own benefit, or for
any purpose other than the exclusive  benefit of the Company,  any confidential,
proprietary,   business  and  technical   information   or  trade  secrets  (the
"Proprietary  Information")  of the Company or any of its  subsidiaries  whether
learned prior to or after the date hereof.

     Proprietary  Information  shall  include,  but shall not be limited to, any
information  relating to computer codes or  instructions  (including  source and
object code listings, logic algorithms,  subroutines,  modules or other subparts
of computer programs and related  documentation,  including  program  notation);
computer  processing  systems and  techniques;  concepts;  layouts;  flowcharts;
specifications;  know-how; any associated  programmer,  user or other manuals or
other like textual materials; all computer inputs and outputs (regardless of the
media on which it is stored or located);  hardware and software  configurations;
designs;  interfaces;   research;  processes;   inventions;  products;  methods;
marketing,  sales and distribution  data, plans and efforts;  relationships with
actual and prospective customers and suppliers; and any other materials prepared
by  Executive  in the  course of  Executive's  employment  with the  Company  or
prepared  by any other  employee  or  contractor  of the  Company  or any of its
subsidiaries  for their  customers,  and any other  materials that have not been
made available to the general public.

     Furthermore,   nothing  contained  herein  shall  restrict  Executive  from
divulging or using for his own benefit or for any other purpose any  Proprietary
Information  that is readily  available  to the  general  public so long as such
information  did not  become  available  to the  general  public  as a direct or
indirect result of Executive's breach of this Agreement.

     b. All right, title and interest in and to Proprietary Information shall be
and remain the sole and exclusive  property of the Company.  Executive  will not
remove from the Company's offices or premises any documents, records, notebooks,
files, correspondence,  reports, memoranda or similar materials of or containing
Proprietary Information, or other materials or property of any kind belonging to
the Company  unless  necessary or  appropriate  in  connection  with the ongoing
business  of the  Company  or its  subsidiaries  and,  in the  event  that  such
materials  or property are removed,  all of the  foregoing  shall be returned to
their proper files or places of  safekeeping  as promptly as possible  after the
removal shall serve its specific purpose.

     Executive shall not make,  retain,  remove and/or  distribute any copies of
any of the Proprietary  Information for any reason  whatsoever  except as may be
necessary  in the  performance  of  Executive's  obligations  as an  officer  or
employee of the Company or any of its subsidiaries.  Executive shall not divulge
to any third  person the  nature of and/or  contents  of any of the  Proprietary
Information  to which  Executive  may have  access or with  which for any reason
Executive  became  familiar in the course of Executive's  employment  hereunder,
except as  disclosure  shall be  necessary  for the purposes of  conducting  the
ongoing business of the Company.  Upon  Executive's  termination as an employee,
officer or director of the Company or any of its  subsidiaries,  Executive shall
return to the Company all  originals and copies of the  Proprietary  Information
then in Executive's possession.

     c. Nothing contained herein shall restrict  Executive's ability to make any
disclosures as may be required by law; provided,  however,  that Executive shall
(i) deliver to the Company  reasonably prompt prior written notice of the nature
and justification for such disclosures;  and (ii) cooperate  reasonably with the
Company prior to any such disclosure in any actions which the Company shall take
in order to obtain a  protective  order or similar  relief  with  respect to the
Proprietary Information sought to be disclosed.

          14. Non-Compete and Non-Solicitation Covenants.

     a. Except (i) in  furtherance  of the  Company's  business or  otherwise on
behalf of the Company,  (ii) after the Company's  termination  of this Agreement
without Cause (as defined in Section 5 (c)), (iii) after Executive's termination
of this  Agreement  pursuant to paragraphs  (d), (e) or (f) of Section 5 or (iv)
upon the occurrence of a Material  Adverse Event (as defined  below),  Executive
will not do any of the  following,  directly  or  indirectly,  during the period
beginning  with the Effective Time and ending on the third  anniversary  thereof
("Covenant  Period")  without the prior  written  consent of the  Company  Board
(which consent shall not be unreasonably withheld):

               (1)  engage  or  participate,  directly  or  indirectly,  in  any
               business activity  competitive with the business conducted by the
               Company or any of its  subsidiaries  as of the Effective  Time or
               thereafter (collectively, the "Business");

               (2) become interested (as owner,  stockholder,  lender,  partner,
               co-venturer,  director,  officer,  employee, agent, consultant or
               otherwise) in any person, firm, corporation, association or other
               entity  engaged  in any  business  that is  competitive  with the
               Business, or become interested in (as owner, stockholder, lender,
               partner,   co-venturer,   director,   officer,  employee,  agent,
               consultant  or  otherwise)  any  portion of the  business  of any
               person,  firm,  corporation,  association or other entity if such
               portion  of such  business  is  competitive  with  the  Business.
               Notwithstanding  the foregoing,  Executive may hold not more than
               one percent (1%) of the  outstanding  securities  of any class of
               any  publicly-traded  securities  of a company that is engaged in
               activities competitive with the Business.

     b. Except in furtherance  of the Company's  Business or otherwise on behalf
of the  Company,  Executive  will  not do any  of  the  following,  directly  or
indirectly,  during the Covenant Period without the prior written consent of the
Company Board (which consent shall not be unreasonably withheld):

               (1)  solicit  or call on,  either  directly  or  indirectly,  any
               customer  or  supplier  with  whom  the  Company  or  any  of its
               subsidiaries  shall have  dealt  with (x) in the two year  period
               preceding the Effective  Time or (y) any time after the Effective
               Time;

               (2) influence or attempt to influence  any supplier,  customer or
               potential  customer  of the  Company to  terminate  or modify any
               written or oral  agreement  or course of dealing with the Company
               or any of its subsidiaries; or

               (3)  influence or attempt to influence  any person  either (i) to
               terminate or modify his or her  employment,  consulting,  agency,
               distributorship  or other  arrangement with the Company or any of
               its subsidiaries, or (ii) to employ or retain, or arrange to have
               any other person or entity  employ or retain,  any person who has
               been   employed  or  retained  by  the  Company  or  any  of  its
               subsidiaries as an employee,  consultant, agent or distributor of
               the Company or any of its subsidiaries at any time during (x) the
               one (1) year period  immediately  preceding the Effective Time or
               (y) any time after the Effective Time.

               c. Definition

               The term "Material Adverse Event" shall mean

                    (i) a bankruptcy  petition  filed  against the Company under
                    and  pursuant to Chapter 7 of the United  States  Bankruptcy
                    Code;

                    (ii) the dissolution of the Company;

                    (iii) the  assignment of Executive  without his consent,  to
                    responsibilities  or duties of a materially lesser status or
                    degree of responsibility  than Executive's  responsibilities
                    or duties as of the Effective Time; or

                    (iv) the  requirement  by the  Company  that the  Executive,
                    without his consent,  be based anywhere other than the place
                    where Executive is based as of the Effective Time.

     d. Executive acknowledges that (i) he has carefully read and considered the
provisions  of  this  Section  14,  and  (ii)  has  obtained  legal  counsel  in
determining  whether to enter into this Agreement.  Executive  acknowledges that
the  foregoing  restrictions  may limit his  ability to earn a  livelihood  in a
business similar to the Business,  but Executive  nevertheless  believes that he
has received and will receive  sufficient  consideration  and other  benefits in
connection with the Agreement to justify such  restrictions,  which restrictions
Executive  does not believe  would  prevent him or her from  earning a living in
businesses  that are not  competitive  with the Business  and without  otherwise
violating the restrictions set forth herein.

     e.  The  terms  of the  covenants  contained  in this  Section  14 shall be
construed as separable and shall be  independent  and shall be  interpreted  and
applied consistently with the requirements of reasonableness and equity.  Except
as  otherwise  provided  in Section  14 a, these  covenants  shall  survive  the
termination of this Agreement during the Covenant Period but not thereafter.

          15. Specific Enforcement; Extension of Covenant Period.

     a. Executive  acknowledges  that the  restrictions  contained in Section 14
hereof are reasonable  and necessary to protect the  legitimate  interest of the
Company.  Executive  also  acknowledges  that any  breach  by him or her of such
sections will cause  continuing and irreparable  injury to the Company for which
monetary damages would not be an adequate remedy. Executive agrees that he shall
not, in any action or proceeding to enforce Section 14 of this Agreement, assert
the claim or defense that an adequate remedy at law exists. In the event of such
breach by Executive,  the Company shall have the right to enforce the provisions
of Section 14 of this  Agreement  by seeking  injunctive  or other relief in any
court and this Agreement shall not in any way limit remedies of law or in equity
otherwise available to the Company with respect to such section.

     b. The  Covenant  Period set forth in Section 14 hereof  shall not include,
and shall be deemed extended by, any time required for litigation to enforce the
relevant  covenants;  provided,  that the Company is successful on the merits in
any such  litigation.  The "time  required for  litigation" is herein defined to
mean the period of time from  service  of process  upon  Executive  through  the
expiration of all appeals related to such litigation.

          16. Registration Expenses of Executive.

     The  Company  agrees to pay  reasonable  attorney's  fees of  Executive  in
connection with Executive's  participation in a Demand  Registration,  Piggyback
Registration  or Tag-Along  transaction on the same basis and in the same amount
made  available  to  other  selling   stockholders  in  such  registrations  and
transactions.

          17. Change of Control

          For purposes  hereof,  the term "change in control"  shall mean any of
          the following events:

     a. if any  "Person"  (as the term  person is used for  purposes of Sections
13(d) or 14(d) of the  Securities  Exchange  Act of 1934 ("1934 Act") shall have
"Beneficial Ownership" (as the term beneficial ownership is used for purposes of
Rule 13d-3 promulgated under the 1934 Act) of thirty three percent (33%) or more
of the combined  voting power of Company's then  outstanding  voting  securities
("Voting  Securities"),  at any time  that the  Beneficial  Ownership  of Voting
Securities  of  the  Company  by  such  Person  exceeds  Executive's  Beneficial
Ownership of Voting Securities of the Company;

     b.  the  approval  by   stockholders  of  the  Company  of  (i)  a  merger,
reorganization  or  consolidation  involving the Company if the  stockholders of
Company immediately before such merger, reorganization or consolidation,  do not
or will not own  directly  or  indirectly  immediately  following  such  merger,
reorganization  or  consolidation  more than fifty percent (50%) of the combined
voting power of the outstanding  voting securities of the corporation  resulting
from or surviving such merger,  reorganization or consolidation in substantially
the same proportion as their  ownership of the Voting  Securities of the Company
immediately before such merger, reorganization or consolidation, (ii) a complete
liquidation  or dissolution of the Company or (iii) an agreement for the sale or
other disposition of all or substantially all of the assets of the Company; or

     c. the acceptance by  stockholders of Company of shares in a share exchange
if the stockholders of Company immediately before such share exchange, do not or
will not own directly or indirectly  immediately  following  such share exchange
more than fifty  percent (50%) of the combined  voting power of the  outstanding
voting  securities of the  corporation  resulting  from or surviving  such share
exchange in  substantially  the same  proportion  as the ownership of the Voting
Securities of the Company outstanding immediately before such share exchange.

     d. if William E. Dickenson shall cease to serve as Chief Executive  Officer
of PHB Hagler Bailly or as Executive Vice President and Chief Operating  Officer
of the  Company  before  January 1,  2000,  or after  January 1, 2000,  as Chief
Executive Officer of the Company or as a Director of the Company other than as a
result of death or disability or termination for cause pursuant to Section 5(c);
e. if Howard W. Pifer III shall cease to serve as Chairman of the Company  Board
before  January 1, 2000,  or as a member of the  Company  Board  other than as a
result of death or disability or termination for cause pursuant to Section 5(c);

     f. if  Executive  shall  cease to serve as Chief  Executive  Officer of the
Company  before  January 1, 2000,  or after  January 1, 2000, as Chairman of the
Company Board, other than as a result of death,  disability,  electing to resign
or termination for cause pursuant to Section 5(c).

          18. Arbitration

     Except as  otherwise  provided  in Section  15, in the event of any dispute
between the parties under or relating to this Agreement or otherwise relating to
Executive's  employment  by the Company,  such dispute shall be submitted to and
settled by arbitration in Arlington,  Virginia, in accordance with the rules and
regulations  of  the  American  Arbitration  Association  then  in  effect.  The
arbitrators  shall have the right and  authority to determine how their award or
decision as to each issue and matter in dispute may be  implemented or enforced.
Any decision or award shall be final and  conclusive  on the  parties;  judgment
upon any award or decision may be entered in any court or competent jurisdiction
in the Commonwealth of Virginia or elsewhere;  and the parties hereto consent to
the application by any party in interest to any court of competent  jurisdiction
for confirmation or enforcement of such award.


     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.

               HAGLER BAILLY, INC.


               By:/s/ Daniel M.  Rouse
                  -----------------------
               Name: Daniel M. Rouse Title:
               Vice President and Chief Financial Officer


               HENRI-CLAUDE BAILLY


                 /s/ Henri-Claude Bailly 
                 ------------------------