INDEPENDENT BANKSHARES, INC.
                  EMPLOYEE RETENTION AGREEMENT


     This Agreement, effective as of its execution, by and
between Independent Bankshares, Inc., a Texas corporation, and
its successors and assigns (collectively the "Company"), and
________, a key employee and a select member of management of the
Company (the "Executive"), provides as follows:

     WHEREAS, the Executive is currently an employee and a select
member of management of the Company, serving at the pleasure of
the Board of Directors of the Company; and

     WHEREAS, the Company desires to provide additional
incentives to the Executive to continue his employment with the
Company in the event that there is a change in control of the
Company; and

     WHEREAS, the Company and the Executive now desire to enter
into this Agreement to establish the sole and exclusive terms and
conditions upon which such payments will be made.

     NOW, THEREFORE, in consideration of the mutual undertakings
set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are
acknowledged, the Company and the Executive agree as follows:


ARTICLE I  DEFINITIONS

     1.1  "Beneficiary" shall mean the person(s) described in
          Article 4 of this Agreement.

     1.2  "Board" shall mean the Board of Directors of the
          Company.

     1.3  "Cause" when used in this Agreement concerning the
          termination of the Executive's employment by the
          Company shall mean:

          i.   any act on the part of the Executive which
               constitutes fraud or willful malfeasance of duty
               or an act of moral turpitude and which is
               demonstrably likely to lead to material injury to
               the Company;

          ii.  a conviction for a felony or misdemeanor involving
               moral turpitude; or

          iii. the suspension or removal of the Executive by
               federal or state regulatory authorities.

     1.4  "Change in Control" shall mean and shall be deemed to
          have occurred for purposes of this Agreement on the
          first to occur of the following:

                                   -1-
<PAGE>
          i.   the Company is merged or consolidated with another
               corporation and as a result of such merger of
               consolidation, less than fifty percent (50%) of
               the outstanding voting securities of the surviving
               or resulting corporation are owned in the
               aggregate by the former shareholders of the
               Company;

          ii.  the Company sells all or substantially all of its
               assets to another corporation, which is not a
               wholly owned subsidiary of the Company or an
               entity owned by substantially the same shareholder
               as the Company; or

          iii. any person, entity or group (within the meaning of
               the Securities Exchange Act of 1934, as amended),
               acquires (together with voting securities of the
               Company held by such person, entity or group)
               fifty percent (50%) or more of the outstanding
               voting securities of the Company (whether
               directly, indirectly, beneficially or of record)
               pursuant to any transaction or combination of
               transactions.

     1.5  "Code" shall mean the Internal Revenue Code of 1986, as
          amended.

     1.6  "Compensation" shall mean the amount reported on the
          Executive's Form W-2 for the calendar year immediately
          preceding the date a Change in Control occurs.

     1.7  "Constructive Termination" shall mean any circumstance
          pursuant to which Executive's Compensation is
          diminished, job title is changed to a position of
          lesser importance, or responsibilities are materially
          reduced.

     1.8  "Disability" or "Disabled" shall mean the total and
          permanent disability as defined in the Company's long-
          term disability plan, or if the Company has no long-
          term disability plan in effect at the time of the
          Executive's disability, shall have the meaning provided
          in section 22(e)(3) of the Code.

     1.9  "ERISA" shall mean the Employee Retirement Income
          Security Act of 1974, as amended.

     1.10 "Retention Benefit" shall mean a cash lump sum payment
          equal to the product of two (2) multiplied by the
          Executive's Compensation.

     1.11 "Retention Period" shall mean the period beginning on
          the date of a Change of Control and ending three
          hundred sixty-five (365) days after the date of a
          Change in Control.



ARTICLE II  BENEFITS

     2.1  Eligibility.  Subject to the provisions of Article 6
          hereof, the Executive is entitled to receive a
          Retention Benefit at the conclusion of the Retention
          Period unless the

                                   -2-

<PAGE>

          Executive is not employed by the Company upon the
          expiration of the Retention Period; and the reason the
          Executive is no longer employed is because either (i)
          he was terminated by the Company with Cause or (ii) he
          resigns or severs his employment with the Company for
          any reason other than a Constructive Termination.
          Without limitation, in the event the Executive dies or
          becomes Disabled after the Company enters into an
          agreement that results in a Change in Control but prior
          to the end of the Retention Period, Executive will be
          entitled to receive the Retention Benefit pro rated for
          the portion of the Retention Period that he served with
          the Company prior to his death or Disability.

     2.2  Payment.  The Retention Benefit shall be paid by the
          Company in a cash lump sum payment within thirty (30)
          days after the end of the Retention Period, unless
          Executive is terminated without Cause, dies or becomes
          Disabled prior to such time.  In the event of such a
          termination without Cause, including a Constructive
          Termination, a death or Disability, the Retention
          Benefit or the pro rated portion of the Retention
          Benefit, as the case may be, shall be paid by the
          Company within thirty (30) days of such termination,
          death or Disability.

ARTICLE III  RESTRICTIONS UPON FUNDING

     3.1  No Funding Obligation.  The Company shall have no
          obligation to set aside, earmark or entrust any fund or
          money with which to pay its obligations under this
          Agreement.  The Executive, his Beneficiary or any
          successor-in-interest to his shall be and remain simply
          a general creditor of the Company in the same manner as
          any other creditor having a general unsecured claim.

     3.2  Unfunded Arrangement.  For purposes of the Code, the
          Company intends this Agreement to be an unfunded,
          unsecured promise to pay on the part of the Company.
          For purposes of ERISA, the Company intends that this
          Agreement not be subject to ERISA.  If this Agreement
          is deemed subject to ERISA, it is intended to be an
          unfunded arrangement for the benefit of a select member
          of management who is a highly compensated employee of
          the Company, for the purpose of qualifying this
          Agreement for the "top hat" plan exception under
          sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

     3.3  No Right to Investments.  Should the Company elect to
          purchase life insurance, mutual funds, disability
          policies or annuities pursuant to this Agreement, the
          Company reserves the absolute right, in its sole
          discretion, to terminate such investments at any time,
          in whole or in part.  At no time shall the Executive
          have, or be deemed to have, any lien, right, title or
          interest in or to any specific investment or to any
          assets of the Company as a result of this Agreement;
          rather, the Executive shall remain a general unsecured
          creditor of the Company.

     3.4  Insurance, Disability or Annuity Policy.  If the
          Company elects to invest in a life insurance,
          disability or annuity policy upon the life of the
          Executive, the

                              -3-
<PAGE>

          Executive shall assist the Company by freely
          submitting to a physical examination and supplying such
          additional information necessary to obtain such
          insurance or annuities.

ARTICLE IV  DESIGNATION OF BENEFICIARIES

     4.1  Payment to Beneficiary.  Should the Executive die prior
          to full payment of amounts due under Article 2, payment
          shall be made to his Beneficiary.  The Executive's
          written designation of one or more persons or entities
          as his Beneficiary shall operate to designate the
          Executive's Beneficiary under this Agreement.  The
          Executive shall file with the Company a copy of his
          Beneficiary designation on the form supplied to the
          Executive by the Company.  The last such designation
          form received by the Company shall be controlling, and
          no designation or change or revocation of a designation
          shall be effective unless received by the Company prior
          to the Executive's death.

     4.2  Payment to Estate.  If no Beneficiary designation is in
          effect at the time of the Executive's death, if no
          designated Beneficiary survives the Executive, or if
          the otherwise applicable Beneficiary designation
          conflicts with applicable law, the Executive's estate
          shall be the Beneficiary.

ARTICLE V  INTERPRETATION, AMENDMENT, AND TERMINATION

     The Board shall have the exclusive power and authority to
interpret and construe the Agreement.  The Board may engage
agents to assist it, including legal counsel, who may be counsel
to the Company.  Other than as provided in Article 6, this
Agreement may be amended, suspended, or terminated, in whole or
in part, only by a written instrument signed by both a duly
authorized officer of the Company other than the Executive and by
the Executive.

ARTICLE VI  TERMINATION OF AGREEMENT

     This Agreement will terminate, unless renewed, upon the
earlier of the following:  (i) the payment of a Retention Benefit
in accordance with Article 2, (ii) the expiration of one (1) year
from the effective date of this Agreement, if an agreement
providing for a Change of Control has not been executed or (iii)
termination of the Executive's employment on a basis that does
not entitle the Executive to a Retention Benefit under Section
2.1.  This Agreement shall automatically annually renew unless
thirty (30) days prior to the end of the annual anniversary date
of this Agreement, the Company provides Executive with written
notice of termination of this Agreement.

ARTICLE VII  MISCELLANEOUS

     7.1  Alienability and Assignment Prohibition.  Neither the
          Executive, his spouse, nor any other Beneficiary under
          this Agreement shall have any power or right to
          transfer, assign, anticipate, hypothecate, mortgage,
          commute, modify or otherwise

                                   -4-
<PAGE>

          encumber in advance any of the benefits payable under
          this Agreement nor shall any of said benefits be
          subject to seizure for the payment of any debts,
          judgments, alimony or separate maintenance owed by the
          Executive or his Beneficiary, nor be transferable by
          operation of law in the event of bankruptcy, insolvency
          or otherwise.

     7.2  Gender.  Whenever in this Agreement words are used in
          the masculine or neuter gender, they shall be read and
          construed as in the masculine, feminine or neuter
          gender, whenever they should so apply.

     7.3  Effect on Other Corporate Benefit Plans.  Nothing
          contained in this Agreement shall affect the right of
          the Executive to participate in or be covered by any
          qualified or non-qualified pension, profit sharing,
          group, bonus or other supplemental compensation or
          fringe benefit plan constituting a part of the
          Company's existing or future compensation structure.

     7.4  Headings.  Headings and subheadings in this Agreement
          are inserted for reference and convenience only and
          shall not be deemed a part of this Agreement.

     7.5  Applicable Law.  The validity and interpretation of
          this Agreement shall be governed by the laws of the
          State of Texas.  This Agreement, as amended from time
          to time in writing, shall establish the sole and
          exclusive terms and conditions upon which payments will
          be made under this Agreement.  The venue for any
          litigation involving the subject matter of this
          Agreement shall be Taylor County, Texas.

     7.6  No Employment Agreement.  No provision of this
          Agreement shall be deemed or construed to create
          specific employment rights to the Executive nor limit
          the right of the Company to discharge the Executive at
          any time with or without cause.  In a similar fashion,
          no provision shall limit the Executive's rights to
          voluntarily sever his employment at any time.

     7.7  Withholding of Taxes.  The Company shall deduct from
          the amount of any payment made pursuant to this
          Agreement any amounts required to be paid or withheld
          by the Company with respect to applicable Federal
          income, Federal Insurance Contributions Act or Federal
          Unemployment Tax Act taxes or applicable state taxes.
          By executing this Agreement, the Executive agrees to
          all such deductions.

     7.8  Severability.  In case any one or more of the
          provisions contained in this Agreement shall be
          invalid, illegal or unenforceable in any respect, the
          validity, legality and enforceability of the remaining
          provisions in this Agreement shall not in any way be
          affected or impaired.

                              -5-
<PAGE>

     7.9  Binding Effect.  This Agreement shall bind the
          Executive and the Company, and their successors,
          assigns, beneficiaries, survivors, executors,
          administrators and transferees.

     7.10 Counterparts.  This Agreement may be executed in
          multiple counterparts, each of which shall be
          considered an original of this instrument, and all or
          both of which shall be considered one and the same
          instrument.

     IN WITNESS WHEREOF, the parties hereto acknowledge that each
has carefully read this Agreement and executed an original hereof
on the _____ day of _____________________, 1999, and that, upon
execution, each has received a counterpart hereof.

                              EXECUTIVE


                              ______________________________


                              INDEPENDENT BANKSHARES, INC.


                              By:
                                  ----------------------------
                              Name:
                                  ----------------------------
                              Title:
                                    --------------------------

     The above and foregoing Agreement having been presented to
the Board of Directors of Independent Bankshares, Inc. the same
day has been formally approved by the Board of Directors on the
15th day of September, 1999.



                              ---------------------------------
                              Scott Taliaferro, Sr., Chairman of the
                              Board of Directors

                         -6-
<PAGE>


STATE OF TEXAS      )
                    )
COUNTY OF           )

     This instrument was acknowledged before me by _____________,
on this ______________ day of___________________ , 1999.


                              ___________________________________
                              Notary Public-State of Texas

My Commission Expires:
______________________


STATE OF TEXAS      )
                    )
COUNTY OF           )

     This instrument was acknowledged before me by_______________ ,
of INDEPENDENT BANKSHARES, INC. on this ______________ day of
__________________ , 1999.


                              __________________________________
                              Notary Public-State of Texas

My Commission Expires:
______________________




                                   -7-