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                                                                   EXHIBIT 10.19

                  2001 KEY EMPLOYEE PERFORMANCE INCENTIVE PLAN

SECTION 1.  Purpose of Plan

The purpose of this "2001 Key Employee Performance Incentive Plan" ("Plan") of
Fluor Corporation, a Delaware corporation, is to enable the Company, as defined
in Section 2.2(a)(ii) hereof, to attract, retain and motivate its officers,
management and other key personnel, and to further align the interests of such
persons with those of the shareholders of the Company, by providing for or
increasing their proprietary interest in the Company.

SECTION 2.  Administration of the Plan

2.1 Composition of Committee. The Plan shall be administered by the Organization
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and Compensation Committee of the Board of Directors, and/or by the Board of
Directors or another committee of the Board of Directors of the Company, as
appointed from time to time by the Board of Directors (any such administrative
body, the "Committee"). The Board of Directors shall fill vacancies on, and from
time to time may remove or add members to, the Committee. The Committee shall
act pursuant to a majority vote or unanimous written consent. Notwithstanding
the foregoing, the Committee may appoint one or more separate committees (any
such committee, a "Subcommittee") composed of one or more directors of the
Company (who may but need not be members of the Committee) and may delegate to
any such Subcommittee(s) the authority to grant Awards, as defined in Section
5.1 hereof, under the Plan to Employees, to determine all terms of such Awards,
and/or to administer the Plan or any aspect of it. Any action by any such
Subcommittee within the scope of such delegation shall be deemed for all
purposes to have been taken by the Committee. The Committee may designate the
Secretary of the Company or other Company employees to assist the Committee in
the administration of the Plan, and may grant authority to such persons to
execute agreements evidencing Awards made under this Plan or other documents
entered into under this Plan on behalf of the Committee or the Company.

2.2 Powers of the Committee. Subject to the express provisions of this Plan, the
    -----------------------
Committee shall be authorized and empowered to do all things necessary or
desirable in connection with the administration of this Plan with respect to the
Awards over which such Committee has authority, including, without limitation,
the following:

         (a) to prescribe, amend and rescind rules and regulations relating to
         this Plan and to define terms not otherwise defined herein; provided
         that, unless the Committee shall specify otherwise, for purposes of
         this Plan (i) the term "fair market value" shall mean, as of any date,
         the average of the highest price and the lowest price per share at
         which the Shares (as defined in Section 3.1 hereof) are sold in the
         regular way on the New York Stock Exchange or, if no Shares traded on
         the New York Stock Exchange on the date in question, then for the next
         preceding date for which Shares traded on the New York Stock Exchange;
         and (ii) the term "Company" shall mean Fluor Corporation and its
         subsidiaries and affiliates, unless the context otherwise requires.

         (b) to determine which persons are Eligible Employees (as defined in
         Section 4 hereof), to which of such Eligible Employees, if any, Awards
         shall be granted hereunder, to make

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          Awards under the Plan and to determine the terms of such Awards and
          the timing of any such Awards;

          (c) to determine the number of Shares subject to Awards and the
          exercise or purchase price of such Shares;

          (d) to establish and verify the extent of satisfaction of any
          performance goals applicable to Awards;

          (e) to prescribe and amend the terms of the agreements or other
          documents evidencing Awards made under this Plan (which need not be
          identical);

          (f) to determine whether, and the extent to which, adjustments are
          required pursuant to Section 11 hereof;

          (g) to interpret and construe this Plan, any rules and regulations
          under the Plan and the terms and conditions of any Award granted
          hereunder, and to make exceptions to any such provisions in good faith
          and for the benefit of the Company; and

          (h) to make all other determinations deemed necessary or advisable for
          the administration of the Plan.

2.3 Determinations of the Committee. All decisions, determinations and
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interpretations by the Committee or the Board regarding the Plan shall be final
and binding on all Eligible Employees and Participants, as defined in Section 4
hereof. The Committee or the Board, as applicable, shall consider such factors
as it deems relevant, in its sole and absolute discretion, to making such
decisions, determinations and interpretations including, without limitation, the
recommendations or advice of any officer of the Company or Eligible Employee and
such attorneys, consultants and accountants as it may select.

SECTION 3.  Stock Subject to Plan

3.1 Aggregate Limits. Subject to adjustment as provided in Section 11, at any
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time, the aggregate number of shares of the Company's common stock, $0.01 par
value ("Shares"), issued pursuant to all Awards granted under this Plan shall
not exceed 3,600,000; provided that no more than 500,000 of such Shares may be
issued pursuant to all Restricted Stock Awards, Incentive Awards, and Stock
Units (other than Stock Units issued upon exercise of Options and any such
awards issued as Assumed Awards) granted under the Plan. The Shares subject to
the Plan may be either Shares reacquired by the Company, including Shares
purchased in the open market, or authorized but unissued Shares.

3.2 Issuance of Shares. For purposes of Section 3.1, the aggregate number of
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Shares issued under this Plan at any time shall equal only the number of Shares
actually issued upon exercise or settlement of an Award and not returned to the
Company upon cancellation, expiration or forfeiture of an Award or delivered
(either actually or by attestation) in payment or satisfaction of the purchase
price, exercise price or tax obligation of an Award.

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SECTION 4.  Persons Eligible Under Plan
Any "Eligible Employee" shall be eligible to be considered for the grant of
Awards under the Plan. For purposes of the Plan, an "Eligible Employees" is (i)
any full-time employee in the United States who is an "exempt employee," as
defined under Fair Labor Standards Act of 1938, (ii) any prospective full-time
"exempt employee" of the Company, (iii) any key employee of any joint venture in
which the Company or its subsidiaries is an equity participant, (iv) any
consultant, and (v) any advisor of the Company. Notwithstanding the foregoing,
if any Awards are granted to executive officers or directors of the Company,
then at least a majority of the shares of stock or shares of stock underlying
Options awarded under the Plan during any three year period must be awarded to
employees who are not executive officers or directors of the Company. For
purposes of this Plan, the Chairman of the Board's status as an Employee shall
be determined by the Board. For purposes of the administration of Awards, the
term "Eligible Employee" shall also include a former Eligible Employee or any
person (including any estate) who is a beneficiary of a former Eligible
Employee. A "Participant" is any Eligible Employee to whom an Award has been
made and any person (including any estate) to whom an Award has been assigned or
transferred pursuant to Section 10.1.

SECTION 5.  Plan Awards

5.1 Award Types. The Committee, on behalf of the Company, is authorized under
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this Plan to enter into certain types of arrangements with Eligible Employees
and to confer certain benefits on them. The following such arrangements or
benefits are authorized under the Plan if their terms and conditions are not
inconsistent with the provisions of the Plan: Stock Options, Restricted Stock,
Incentive Awards, Stock Units and Assumed Awards. Such arrangements and benefits
are sometimes referred to herein as "Awards." The authorized types of
arrangements and benefits for which Awards may be granted are defined as
follows:

          Stock Option Awards: A Stock Option is a right granted under Section 6
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          to purchase a number of Shares at such exercise price, at such times,
          and on such other terms and conditions as are specified in or
          determined pursuant to the document(s) evidencing the Award (the
          "Option Agreement"). Only Options which are not intended to qualify as
          Incentive Stock Options pursuant to Section 422 of the Internal
          Revenue Code (i.e., only "Non-qualified Options") may be granted under
          the Plan.

          Restricted Stock Awards: Restricted Stock is an award of Shares made
          -----------------------
          under Section 7, the grant, issuance, retention and/or vesting of
          which is subject to such performance and other conditions as are
          expressed in the document(s) evidencing the Award (the "Restricted
          Stock Agreement").

          Incentive Awards: An Incentive Award is a bonus opportunity awarded
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          under Section 8 pursuant to which a Participant may become entitled to
          receive an amount (which may be payable in cash, Shares or other
          property) based on satisfaction of such performance criteria as are
          specified in the document(s) evidencing the Award (the "Incentive
          Bonus Agreement").

          Stock Unit Awards: A Stock Unit Award is an award of a right to
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          receive the fair market value of one share of Common Stock made under
          Section 9, the grant, issuance,

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          retention and/or vesting of which is subject to such performance and
          other conditions as are expressed in the document(s) evidencing the
          Award (the "Stock Unit Agreement").

5.2 Grants of Awards. An Award may consist of one such arrangement or benefit or
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two or more of them in tandem or in the alternative.

SECTION 6.  Stock Option Awards

The Committee may grant an Option or provide for the grant of an Option, either
from time-to-time in the discretion of the Committee or automatically upon the
occurrence of specified events, including, without limitation, the achievement
of performance goals, the satisfaction of an event or condition within the
control of the recipient of the Award, within the control of others or not
within any person's control.

6.1 Option Agreement. Each Option Agreement shall contain provisions regarding
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(a) the number of Shares which may be issued upon exercise of the Option, (b)
the purchase price of the Shares and the means of payment for the Shares, (c)
the term of the Option, (d) such terms and conditions of exercisability as may
be determined from time to time by the Committee, (e) restrictions on the
transfer of the Option and forfeiture provisions, and (f) such further terms and
conditions, in each case not inconsistent with the Plan as may be determined
from time to time by the Committee.

6.2 Option Price. The purchase price per Share of the Shares subject to each
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Option granted under the Plan shall equal or exceed 100% of the fair market
value of such Stock on the date the Option is granted, except that (i) the
Committee may specifically provide that the exercise price of an Option may be
higher or lower in the case of an Option granted to employees of a company
acquired by the Company in assumption and substitution of options held by such
employees at the time such company is acquired, and (ii) in the event an
Eligible Employee is required to pay or forego the receipt of any cash amount in
consideration of receipt of an Option, the exercise price plus such cash amount
shall equal or exceed 100% of the fair market value of such Stock on the date
the Option is granted.

6.3 Option Term. The "Term" of each Option granted under the Plan, including any
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ISOs, shall not exceed ten (10) years from the date of its grant.

6.4 Option Vesting. Options granted under the Plan shall be exercisable at such
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time and in such installments during the period prior to the expiration of the
Option's Term as determined by the Committee in its sole discretion. The
Committee shall have the right to make the timing of the ability to exercise any
Option granted under the Plan subject to such performance requirements as deemed
appropriate by the Committee. At any time after the grant of an Option the
Committee may, in its sole discretion, reduce or eliminate any restrictions
surrounding any Participant's right to exercise all or part of the Option.

6.5  Option Exercise.
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               (a) Partial Exercise. An exercisable Option may be exercised in
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               whole or in part. However, an Option shall not be exercisable
               with respect to fractional Shares and the

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               Committee may require, by the terms of the Option Agreement, a
               partial exercise to include a minimum number of Shares.

               (b) Manner of Exercise. All or a portion of an exercisable Option
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               shall be deemed exercised upon delivery to the representative of
               the Company designated for such purpose by the Committee all of
               the following: (i) notice of exercise in such form as the
               Committee authorizes specifying the number of Shares to be
               purchased by the Participant, (ii) payment or provision for
               payment of the exercise price for such number of Shares, (iii)
               such representations and documents as the Committee, in its sole
               discretion, deems necessary or advisable to effect compliance
               with all applicable provisions of the Securities Act of 1933, as
               amended, and any other federal, state or foreign securities laws
               or regulations, (iv) in the event that the Option shall be
               exercised pursuant to Section 10.1 by any person or persons other
               than the Eligible Employee, appropriate proof of the right of
               such person or persons to exercise the Option, and (v) such
               representations and documents as the Committee, in its sole
               discretion, deems necessary or advisable to provide for the tax
               withholding pursuant to Section 13. Unless provided otherwise by
               the Committee, no Participant shall have any right as a
               shareholder with respect to any Shares purchased pursuant to any
               Option until the registration of Shares in the name of such
               person, and no adjustment shall be made for dividends (ordinary
               or extraordinary, whether in cash, securities or other property)
               or distributions or other rights for which the record date is
               prior to the date such Shares are so registered.

               (c) Payment of Exercise Price. To the extent authorized by the
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               Committee, the exercise price of an Option may be paid in the
               form of one of more of the following, either through the terms of
               the Option Agreement or at the time of exercise of an Option: (i)
               cash or certified or cashiers' check, (ii) shares of capital
               stock of the Company that have been held by the Participant for
               such period of time as the Committee may specify, (iii) other
               property deemed acceptable by the Committee, (iv) a reduction in
               the number of Shares or other property otherwise issuable
               pursuant to such Option, (v) a promissory note of or other
               commitment to pay by the Participant or of a third party, the
               terms and conditions of which shall be determined by the
               Committee, or (vi) any combination of (i) through (v).

SECTION 7.  Restricted Stock Awards

Restricted Stock consists of an award of Shares, the grant, issuance, retention
and/or vesting of which shall be subject to such performance conditions and to
such further terms and conditions as the Committee deems appropriate.

7.1 Restricted Stock Award. Each Restricted Stock Award shall reflect, to the
    ----------------------
extent applicable (a) the number of Shares subject to such Award or a formula
for determining such, (b) the time or times at which Shares shall be granted or
issued and/or become retainable or vested, and the conditions or restrictions on
such Shares, (c) the performance criteria and level of achievement versus these
criteria which shall determine the number of Shares granted, issued, retainable
and/or vested, (d) the period as to which performance shall be measured for
determining achievement of performance, (e) forfeiture provisions, and (f) such
further terms and conditions,

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in each case not inconsistent with the Plan as may be determined from time to
time by the Committee.

7.2 Restrictions and Performance Criteria. The grant, issuance, retention and/or
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vesting of each Restricted Stock Award may be subject to such performance
criteria and level of achievement versus these criteria as the Committee shall
determine, which criteria may be based on financial performance, personal
performance evaluations and/or completion of service by the Participant.

7.3 Timing and Form of Award. The Committee shall determine the timing of award
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of any Restricted Stock Award. The Committee may provide for or, subject to such
terms and conditions as the Committee may specify, may permit a Participant to
elect for the award or vesting of any Restricted Stock to be deferred to a
specified date or event. The Committee may provide for a Participant to have the
option for his or her Restricted Stock, or such portion thereof as the Committee
may specify, to be granted in whole or in part in Stock Units.

7.4 Discretionary Adjustments. Notwithstanding satisfaction of any completion of
    -------------------------
service or performance goals, the number of Shares granted, issued, retainable
and/or vested under a Restricted Stock Award on account of either financial
performance or personal performance evaluations may be reduced by the Committee
on the basis of such further considerations as the Committee in its sole
discretion shall determine.

SECTION 8.  Incentive Awards

Each Incentive Award will confer upon the Eligible Employee the opportunity to
earn a future payment tied to the level of achievement with respect to one or
more performance criteria established for a performance period of not less than
one year.

8.1 Incentive Award. Each Incentive Award shall contain provisions regarding (a)
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the target and maximum amount payable to the Participant as an Incentive Award,
(b) the performance criteria and level of achievement versus these criteria
which shall determine the amount of such payment, (c) the period as to which
performance shall be measured for establishing the amount of any payment, (d)
the timing of any payment earned by virtue of performance, (e) restrictions on
the alienation or transfer of the Incentive Award prior to actual payment, (f)
forfeiture provisions, and (g) such further terms and conditions, in each case
not inconsistent with the Plan as may be determined from time to time by the
Committee. In establishing the provisions of Incentive Awards, the Committee may
refer to categories of such Awards as parts of "Programs" or "Plans", which
names will not affect the applicability of this Plan.

8.2 Performance Criteria. The Committee shall establish the performance criteria
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and level of achievement versus these criteria which shall determine the target
and the minimum and maximum amount payable under an Incentive Award, which
criteria may be based on financial performance and/or personal performance
evaluations.

8.3 Timing and Form of Payment. The Committee shall determine the timing of
    --------------------------
payment of any Incentive Award. The Committee may provide for or, subject to
such terms and conditions as the Committee may specify, may permit a Participant
to elect for the payment of any Incentive Award to be deferred to a specified
date or event. The Committee may specify the form of payment of Incentive
Awards, which may be cash, shares or other property, or may provide for a

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Participant to have the option for his or her Incentive Award, or such portion
thereof as the Committee may specify, to be paid in whole or in part in Shares
or Stock Units.

8.4 Discretionary Adjustments. Notwithstanding satisfaction of any performance
    -------------------------
goals, the amount paid under an Incentive Award on account of either financial
performance or personal performance evaluations may be reduced by the Committee
on the basis of such further considerations as the Committee in its sole
discretion shall determine.

SECTION 9.  Stock Units

9.1 Stock Units. A "Stock Unit" is a bookkeeping entry representing an amount
    -----------
equivalent to the fair market value of one share of Common Stock, also sometimes
referred to as a "restricted unit" or "shadow stock". Stock Units represent an
unfunded and unsecured obligation of the Company, except as otherwise provided
for by the Committee.

9.2 Stock Unit Awards. Each Stock Unit Award shall reflect, to the extent
    -----------------
applicable (a) the number of Stock Units subject to such Award or a formula for
determining such, (b) the time or times at which Stock Units shall be granted or
issued and/or become retainable or vested, and the conditions or restrictions on
such Stock Units, (c) the performance criteria and level of achievement versus
these criteria which shall determine the number of Stock Units granted, issued,
retainable and/or vested, (d) the period as to which performance shall be
measured for determining achievement of performance, (e) forfeiture provisions,
and (f) such further terms and conditions, in each case not inconsistent with
the Plan as may be determined from time to time by the Committee. Stock Units
may also be issued upon exercise of Options, may be granted in payment and
satisfaction of Incentive Awards and may be issued in lieu of Restricted Stock
or any other Award that the Committee elects to be paid in the form of Stock
Units.

9.3 Performance Criteria. The grant, issuance, retention and or vesting of each
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Stock Unit may be subject to such performance criteria and level of achievement
versus these criteria as the Committee shall determine, which criteria may be
based on financial performance, personal performance evaluations and/or
completion of service by the Participant; provided, however, that no Stock Unit
shall first vest within one (1) year from its date of grant, other than upon
death, disability, a Change of Control (as defined in Section 12.2 hereof) or
upon satisfaction of such performance requirements as deemed appropriate by the
Committee.

9.4 Timing and Form of Award. The Committee shall determine the timing of award
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of any Stock Unit. The Committee may provide for or, subject to such terms and
conditions as the Committee may specify, may permit a Participant to elect for
the award or vesting of any Stock Unit to be deferred to a specified date or
event. The Committee may provide for a Participant to have the option for his or
her Stock Unit, or such portion thereof as the Committee may specify, to be
granted in whole or in part in Shares.

9.5 Settlement of Stock Units. The Committee may provide for Stock Units to be
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settled in cash or Shares (at the election of the Company or the Participant, as
specified by the Committee) and to be made at such other times as it determines
appropriate or as it permits a Participant to choose. The amount of cash or
Shares, or other settlement medium, to be so distributed may be increased by an
interest factor or by dividend equivalents, as the case may be, which may be

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valued as if reinvested in Shares. Until a Stock Unit is settled, the number of
Shares represented by a Stock Unit shall be subject to adjustment pursuant to
Section 11.

9.6 Discretionary Adjustments. Notwithstanding satisfaction of any completion of
    -------------------------
service or performance goals, the number of Stock Units granted, issued,
retainable and/or vested under a Stock Unit Award on account of either financial
performance or personal performance evaluations may be reduced by the Committee
on the basis of such further considerations as the Committee in its sole
discretion shall determine.

SECTION 10.  Other Provisions Applicable to Awards

10.1 Transferability. During an Eligible Employee's lifetime, Options may be
     ---------------
exercised only by the Participant. Unless the agreement evidencing an Award (or
an amendment thereto authorized by the Committee) expressly states that it is
transferable as provided hereunder, no Award granted under the Plan, nor any
interest in such Award, may be sold, assigned, conveyed, gifted, pledged,
hypothecated or otherwise transferred in any manner, other than by will or the
laws of descent and distribution, prior to the vesting or lapse of any and all
restrictions applicable to any Shares issued under an Award. The Committee may
in its sole discretion grant an Award or amend an outstanding Award to provide
that the Award is transferable or assignable to a member or members of the
Eligible Employee's "immediate family", as such term is defined under Rule
16a-1(e) of the Securities Exchange Act of 1934 (the "Exchange Act"), or to a
trust for the benefit solely of a member or members of the Eligible Employee's
immediate family, or to a partnership or other entity whose only owners are
members of the Eligible Employee's family, provided that following any such
transfer or assignment the Award will remain subject to substantially the same
terms applicable to the Award while held by the Eligible Employee, as modified
as the Committee in its sole discretion shall determine appropriate, and the
Participant shall execute an agreement agreeing to be bound by such terms.

10.2 Qualifying Performance Criteria. For purposes of this Plan, the term
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"Qualifying Performance Criteria" shall mean any one or more of the following
performance criteria, either individually, alternatively or in any combination,
applied to either the Company as a whole or to a business unit, subsidiary or
business segment, either individually, alternatively or in any combination, and
measured either annually or cumulatively over a period of years, on an absolute
basis or relative to a pre-established target, to previous years' results or to
a designated comparison group, in each case as specified by the Committee in the
Award: (a) cash flow, (b) earnings (including gross margin, earnings before
interest and taxes ("EBIT"), earnings before taxes ("EBT"), and net earnings),
(c) earnings per share, (d) growth in earnings or earnings per share, (e) stock
price, (f) return on equity or average stockholders' equity, (g) total
stockholder return, (h) return on capital, (i) return on assets or net assets,
(j) return on investment, (k) revenue, (l) income or net income, (m) operating
income or net operating income, (n) operating profit or net operating profit,
(o) operating margin, (p) return on operating revenue, (q) market share, (r)
contract awards or backlog, (s) overhead or other expense reduction, (t) growth
in stockholder value relative to the two-year moving average of the S&P 500
Index, (u) growth in stockholder value relative to the two-year moving average
of the Dow Jones Heavy Construction Index, (v) credit rating, (w) strategic plan
development and implementation, (x) succession plan development and
implementation, (y) retention of executive talent, (z) improvement in workforce
diversity, (aa) return on average stockholders' equity relative to the Ten Year
Treasury

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Yield (as hereinafter defined), (bb) improvement in safety records, (cc) capital
resource management plan development and implementation, (dd) improved internal
financial controls plan development and implementation, (ee) corporate tax
savings, (ff) corporate cost of capital reduction, (gg) investor relations
program development and implementation, (hh) corporate relations program
development and implementation, (ii) executive performance plan development and
implementation, and (jj) tax provision rate for financial statement purposes.
The Committee may appropriately adjust any evaluation of performance under a
Qualifying Performance Criteria to exclude any of the following events that
occurs during a performance period: (i) asset write-downs, (ii) litigation or
claim judgments or settlements, (iii) the effect of changes in tax law,
accounting principles or other such laws or provisions affecting reported
results, (iv) accruals for reorganization and restructuring programs, and (v)
any extraordinary non-recurring items as described in Accounting Principles
Board Opinion No. 30 and/or in management's discussion and analysis of financial
condition and results of operations appearing in the Company's annual report to
stockholders for the applicable year. The term "Ten Year Treasury Yield" shall
mean, for any fiscal period, the daily average percent per annum yield for U.S.
Government Securities -- 10 year Treasury constant maturities, as published in
the Federal Reserve statistical release or any successor publication.

10.3 Dividends. Unless otherwise provided by the Committee, no adjustment shall
     ---------
be made in Shares issuable under Awards on account of cash dividends which may
be paid or other rights which may be issued to the holders of Shares prior to
their issuance under any Award. The Committee shall specify whether dividends or
dividend equivalent amounts shall be paid to any Participant with respect to the
Shares subject to any Award that have not vested or been issued or that are
subject to any restrictions or conditions on the record date for dividends.

10.4 Agreements Evidencing Awards. The Committee shall, subject to applicable
     ----------------------------
law, determine the date an Award is deemed to be granted, which for purposes of
this Plan shall not be affected by the fact that an Award is contingent on
subsequent stockholder approval of the Plan. The Committee or, except to the
extent prohibited under applicable law, its delegate(s) may establish the terms
of agreements evidencing Awards under this Plan and may, but need not, require
as a condition to any such agreement's effectiveness that such agreement be
executed by the Participant and that such Participant agree to such further
terms and conditions as specified in such agreement. The grant of an Award under
this Plan shall not confer any rights upon the Participant holding such Award
other than such terms, and subject to such conditions, as are specified in this
Plan as being applicable to such type of Award (or to all Awards) or as are
expressly set forth in the Agreement evidencing such Award.

10.5 Tandem Stock or Cash Rights. Either at the time an Award is granted or by
     ---------------------------
subsequent action, the Committee may, but need not, provide that an Award shall
contain as a term thereof, a right, either in tandem with the other rights under
the Award or as an alternative thereto, of the Participant to receive, without
payment to the Company, a number of Shares, cash or a combination thereof, the
amount of which is determined by reference to the value of the Award.

10.6 Financing. The Committee may in its discretion provide financing to a
     ---------
Participant in a principal amount sufficient to pay the purchase price of any
Award and/or to pay the amount of taxes required by law to be withheld with
respect to any Award. Any such loan shall be subject to all applicable legal
requirements and restrictions pertinent thereto, including Regulation G

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promulgated by the Federal Reserve Board. The grant of an Award shall in no way
obligate the Company or the Committee to provide any financing whatsoever in
connection therewith.

SECTION 11.  Changes in Capital Structure

If the outstanding securities of the class then subject to this Plan are
increased, decreased or exchanged for or converted into cash, property or a
different number or kind of shares or securities, or if cash, property or shares
or securities are distributed in respect of such outstanding securities, in
either case as a result of a reorganization, merger, consolidation,
recapitalization, restructuring, reclassification, dividend (other than a
regular, quarterly cash dividend) or other distribution, stock split, reverse
stock split, spin-off or the like, or if substantially all of the property and
assets of the Company are sold, then, unless the terms of such transaction shall
provide otherwise, the Committee may make appropriate and proportionate
adjustments in (i) the number and type of shares or other securities or cash or
other property that may be acquired pursuant to Awards theretofore granted under
this Plan and the exercise or settlement price of such Awards, and (ii) the
maximum number and type of shares or other securities that may be issued
pursuant to such Awards thereafter granted under this Plan.

SECTION 12.  Change of Control

12.1 Effect of Change of Control. The Committee may through the terms of the
     ---------------------------
Award or otherwise provide that any or all of the following shall occur, either
immediately upon the Change of Control or a Change of Control Transaction, or
upon termination of the Eligible Employee's employment within twenty-four (24)
months following a Change of Control or a Change of Control Transaction: (a) in
the case of an Option, the Participant's ability to exercise any portion of the
Option not previously exercisable, (b) in the case of an Incentive Award, the
right to receive a payment equal to the target amount payable or, if greater, a
payment based on performance through a date determined by the Committee prior to
the Change of Control, and (c) in the case of Shares issued in payment of any
Incentive Award, and/or in the case of Restricted Stock or Stock Units, the
lapse and expiration of any conditions to the grant, issuance, retention,
vesting or transferability of, or any other restrictions applicable to, such
Award. The Committee also may, through the terms of the Award or otherwise,
provide for an absolute or conditional exercise, payment or lapse of conditions
or restrictions on an Award which shall only be effective if, upon the
announcement of a Change of Control Transaction, no provision is made in such
Change of Control Transaction for the exercise, payment or lapse of conditions
or restrictions on the Award, or other procedure whereby the Participant may
realize the full benefit of the Award.

12.2 Definitions. Unless the Committee or the Board shall provide otherwise,
     -----------
"Change of Control" shall mean an occurrence of any of the following events (a)
a third person, including a "group" as defined in Section 13(d)(3) of the
Exchange Act, acquires shares of the Company having twenty-five percent or more
of the total number of votes that may be cast for the election of directors of
the Company, (b) as the result of any cash tender or exchange offer, merger or
other business combination, or any combination of the foregoing transactions (a
"Transaction"), the persons who were directors of the Company before the
Transaction shall cease to constitute a majority of the Board of the Company or
any successor to the Company; or (c) such other events as the Committee or the
Board from time to time may specify. "Change of Control Transaction"

<PAGE>

shall include any tender offer, offer, exchange offer, solicitation, merger,
consolidation, reorganization or other transaction which is intended to or
reasonably expected to result in a Change of Control.

SECTION 13.  Taxes

13.1 Withholding Requirements. The Committee may make such provisions or impose
     ------------------------
such conditions as it may deem appropriate for the withholding or payment by the
Employee or Participant, as appropriate, of any taxes which it determines are
required in connection with any Awards granted under this Plan, and a
Participant's rights in any Award are subject to satisfaction of such
conditions.

13.2 Payment of Withholding Taxes. Notwithstanding the terms of Section 13.1
     ----------------------------
hereof, the Committee may provide in the agreement evidencing an Award or
otherwise that all or any portion of the taxes required to be withheld by the
Company or, if permitted by the Committee, desired to be paid by the
Participant, in connection with the exercise of a Non-qualified Option or the
exercise, vesting, settlement or transfer of any other Award shall be paid or,
at the election of the Participant, may be paid by the Company withholding
shares of the Company's capital stock otherwise issuable or subject to such
Award, or by the Participant delivering previously owned shares of the Company's
capital stock, in each case having a fair market value equal to the amount
required or elected to be withheld or paid. Any such elections are subject to
such conditions or procedures as may be established by the Committee and may be
subject to disapproval by the Committee.

SECTION 14.  Amendments or Termination

The Board may amend, alter or discontinue the Plan or any agreement evidencing
an Award made under the Plan at such time and for such purposes as it determines
appropriate, except that after the date of a Change of Control, no such action
may impair the rights of any Award holder, without such holder's consent, under
any Award granted prior to the date of any Change of Control. Any amendment or
alteration of the Plan shall be subject to approval of the Company's
stockholders only to the extent required by applicable law:

           (e)  extend the term of the Plan; or

         (f)  change the class of persons eligible to be Participants.

SECTION 15.  Compliance With Other Laws and Regulations

The Plan, the grant and exercise of Awards thereunder, and the obligation of the
Company to sell, issue or deliver Shares under such Awards, shall be subject to
all applicable federal, state and foreign laws, rules and regulations and to
such approvals by any governmental or regulatory agency as may be required. The
Company shall not be required to register in a Participant's name or deliver any
Shares prior to the completion of any registration or qualification of such
Shares under any federal, state or foreign law or any ruling or regulation of
any government body which the Committee shall, in its sole discretion, determine
to be necessary or advisable. This Plan is intended to constitute an unfunded
arrangement for a select group of management or other key employees.

<PAGE>

No Option shall be exercisable unless a registration statement with respect to
the Option is effective or the Company has determined that such registration is
unnecessary. Unless the Awards and Shares covered by this Plan have been
registered under the Securities Act of 1933, as amended, or the Company has
determined that such registration is unnecessary, each person receiving an Award
and/or Shares pursuant to any Award may be required by the Company to give a
representation in writing that such person is acquiring such Shares for his or
her own account for investment and not with a view to, or for sale in connection
with, the distribution of any part thereof.

SECTION 16.  Option Grants by Subsidiaries

In the case of a grant of an Option to any Eligible Employee employed by a
subsidiary or affiliate, such grant may, if the Committee so directs, be
implemented by the Company issuing any subject Shares to the subsidiary or
affiliate, for such lawful consideration as the Committee may determine, upon
the condition or understanding that the subsidiary or affiliate will transfer
the Shares to the optionholder in accordance with the terms of the Option
specified by the Committee pursuant to the provisions of the Plan.
Notwithstanding any other provision hereof, such Option may be issued by and in
the name of the subsidiary or affiliate and shall be deemed granted on such date
as the Committee shall determine.

SECTION 17.  No Right to Company Employment

Nothing in this Plan or as a result of any Award granted pursuant to this Plan
shall confer on any individual any right to continue in the employ of the
Company or interfere in any way with the right of the Company to terminate an
individual's employment at any time. The Award agreements may contain such
provisions as the Committee may approve with reference to the effect of approved
leaves of absence.

SECTION 18.  Effectiveness and Expiration of Plan

The Plan shall be effective on the date the Board adopts the Plan and Old Fluor
approves the Plan as sole stockholder of the Company. No Stock Option Award,
Restricted Stock Award or Incentive Award shall be granted pursuant to the Plan
more than ten (10) years after the effective date of the Plan.

SECTION 19.  Non-Exclusivity of the Plan

Neither the adoption of the Plan by the Board nor the submission of the Plan to
the shareholders of the Company for approval shall be construed as creating any
limitations on the power of the Board or the Committee to adopt such other
incentive arrangements as it or they may deem desirable, including without
limitation, the granting of restricted stock or stock options otherwise than
under the Plan, and such arrangements may be either generally applicable or
applicable only in specific cases.

SECTION 20.  Governing Law

This Plan and any agreements hereunder shall be interpreted and construed in
accordance with the laws of the State of Delaware and applicable federal law.
The Committee may provide that

<PAGE>

any dispute as to any Award shall be presented and determined in such forum as
the Committee may specify, including through binding arbitration. Any reference
in this Plan or in the agreement evidencing any Award to a provision of law or
to a rule or regulation shall be deemed to include any successor law, rule or
regulation of similar effect or applicability.<PAGE>

                                                                   EXHIBIT 10.20

                                FLUOR CORPORATION
                    2001 FLUOR STOCK APPRECIATION RIGHTS PLAN

<PAGE>

                                    ARTICLE I
                                   DEFINITIONS

Section 1.1  DEFINITIONS

As used herein, the following terms shall have the meanings hereinafter set
forth unless the context clearly indicates to the contrary:

     (a) "Board" shall mean the Board of Directors of the Company.

     (b) "Change of Control" shall mean, unless the Committee or the Board shall
provide otherwise, an occurrence of any of the following events (a) a third
person, including a "group" as defined in Section 13(d)(3) of the Exchange Act,
acquires shares of the Company having twenty-five percent or more of the total
number of votes that may be cast for the election of directors of the Company,
(b) as the result of any cash tender or exchange offer, merger or other business
combination, or any combination of the foregoing transactions (a "Transaction"),
the persons who were directors of the Company before the Transaction shall cease
to constitute a majority of the Board of the Company or any successor to the
Company; or (c) such other events as the Committee or the Board from time to
time may specify. "Change of Control Transaction" shall include any tender
offer, offer, exchange offer, solicitation, merger, consolidation,
reorganization or other transaction which is intended to or reasonably expected
to result in a Change of Control.

     (c) "Committee" shall mean Organization and Compensation Committee of the
Board, and/or another committee of the Board, as appointed from time to time by
the Board.

     (d) "Company" shall mean Fluor Corporation.

     (e) "Fair Market Value" shall mean the average of the highest price and the
lowest price per share at which the Stock is sold in the regular way on the New
York Stock Exchange on the day such value is to be determined hereunder or, in
the absence of any reported sales on such day, the first preceding day on which
there were such sales.

     (f) "Grantee" shall mean an employee to whom Rights have been granted
hereunder.

     (g) "Plan" shall mean the 2001 Fluor Stock Appreciation Rights Plan, the
terms of which are set forth herein.

     (h) "Rights" shall mean Stock Appreciation Rights granted as provided
herein.

     (i) "Stock" shall mean the common stock of the Company or, in the event
that the outstanding shares of Stock are hereafter changed into or exchanged for
shares of a different stock or securities of the Company or some other
corporation, such other stock or securities.

     (j) "Stock Appreciation Rights Agreement" shall mean the agreement between
the Company and the Grantee evidencing the grant of Rights as provided herein.

     (k) "Subsidiary" shall mean any corporation, the majority of the
outstanding capital stock of which is owned, directly or indirectly, by the
Company.

                                       1

<PAGE>

                                   ARTICLE II
                                    THE PLAN

Section 2.1  NAME

This plan shall be known as the "2001 Fluor Stock Appreciation Rights Plan".

Section 2.2  PURPOSE

The purpose of the Plan is to advance the interests of the Company and its
shareholders by providing eligible key management employees who can directly and
significantly influence the profits of the Company and therefore the market
value of its Stock a form of cash incentive compensation which is measured by
the desired increase in the market value of the Stock.

Section 2.3  EFFECTIVE DATE AND DURATION

The Plan shall become effective upon its adoption by the Board. The Rights
granted hereunder must be granted within ten years from the effective date of
the Plan.

                                   ARTICLE III
                                  PARTICIPANTS

Section 3.1  ELIGIBILITY

Any officer or other key management employee of the Company or its Subsidiaries
shall be eligible to participate in the Plan; provided, however, that no member
of the Committee shall be eligible to participate (an "Eligible Employee"). The
Committee may grant Rights to any Eligible Employee in accordance with such
determinations as the Committee from time to time in its sole discretion shall
make. For purposes of the administration of Rights, the term "Eligible Employee"
shall also include a former Eligible Employee or any person (including any
estate) who is a beneficiary of a former Eligible Employee.

                                   ARTICLE IV
                                 ADMINISTRATION

Section 4.1  COMPOSITION OF COMMITTEE

The Plan shall be administered by the Committee. The Board shall fill vacancies
on, and from time to time may remove or add members to, the Committee.

Section 4.2  MAJORITY RULE

A majority of the members of the Committee shall constitute a quorum, and any
action taken by a majority present at a meeting at which a quorum is present or
any action taken without a meeting evidenced by a writing executed by a majority
of the whole Committee shall constitute the action of the Committee.

Section 4.3  COMPANY ASSISTANCE

The Company shall supply full and timely information to the Committee on all
matters relating to Eligible Employees, their employment, death, retirement,
disability or other termination of

                                       2

<PAGE>

employment, and such other pertinent facts as the Committee may require. The
Company shall furnish the Committee with such clerical and other assistance as
is necessary in the performance of its duties. The Committee may designate the
Secretary of the Company or other Company employees to assist the Committee in
the administration of the Plan, and may grant authority to such persons to
execute agreements evidencing Rights made under this Plan or other documents
entered into under this Plan on behalf of the Committee or the Company.

Section 4.4  POWERS OF COMMITTEE

Subject to the express provisions of this Plan, the Committee shall be
authorized and empowered to do all things necessary or desirable in connection
with the administration of this Plan with respect to the Rights over which the
Committee has authority, including, without limitation, the following:

     (a) to prescribe, amend and rescind rules and regulations relating to this
Plan and to define terms not otherwise defined herein;

     (b) to determine which persons are Eligible Employees, to which of such
Eligible Employees, if any, Rights shall be granted hereunder, to make Rights
under the Plan and to determine the terms of such Rights and the timing of any
such Rights;

     (c) to determine the number of Rights and the exercise price of such
Rights;

     (d) to establish and verify the extent of satisfaction of any performance
goals applicable to Rights;

     (e) to prescribe and amend the terms of the agreements or other documents
evidencing Rights made under this Plan (which need not be identical);

     (f) to determine whether, and the extent to which, adjustments are required
pursuant to the terms hereof;

     (g) to interpret and construe this Plan, any rules and regulations under
the Plan and the terms and conditions of any Rights granted hereunder, and to
make exceptions to any such provisions in good faith and for the benefit of the
Company; and

     (h) to make all other determinations deemed necessary or advisable for the
administration of the Plan.

Section 4.5  DETERMINATIONS OF THE COMMITTEE

All decisions, determinations and interpretations by the Committee or the Board
regarding the Plan shall be final and binding on all Eligible Employees. The
Committee or the Board, as applicable, shall consider such factors as it deems
relevant, in its sole and absolute discretion, to making such decisions,
determinations and interpretations including, without limitation, the
recommendations or advice of any officer of the Company or Eligible Employee and
such attorneys, consultants and accountants as it may select.

                                       3

<PAGE>

                                    ARTICLE V
                             RIGHTS SUBJECT TO PLAN

Section 5.1  LIMITATIONS

Subject to adjustment pursuant to the provisions of Section 5.2 hereof, the
number of Rights which may be granted hereunder shall not exceed 3,000,000.
Rights granted hereunder which have been exercised as provided in Section 6.5
hereof shall not again be available for re-grant hereunder. If Rights granted
hereunder shall expire, terminate or be canceled for any reason prior to being
wholly exercised, new grants may be made hereunder with respect to the number of
Rights to which such expiration, termination or cancellation relates.

Section 5.2  ANTIDILUTION

In the event that the outstanding shares of Stock hereafter are changed into or
exchanged for a different number or kind of shares or other securities of the
Company or of another corporation by reason of merger, consolidation, other
reorganization, recapitalization, reclassification, combination of shares, spin
off, stock splitup or stock dividend (other than a regular dividend),

     (a) the aggregate number of Rights which may be granted hereunder may be
adjusted appropriately;

     (b) outstanding Rights granted hereunder, both as to number and value, may
be adjusted appropriately; and

     (c) where dissolution or liquidation of the Company or any merger or
combination in which the Company is not a surviving corporation is involved,
each outstanding Right granted hereunder may terminate, but the Grantee may have
the right, immediately prior to such dissolution, liquidation, merger or
combination, to exercise his or her Rights in full, without regard to any
installment exercise provisions, to the extent that such Rights shall not have
been exercised.

The foregoing adjustments and the manner of application of the foregoing
provisions shall be determined solely by the Committee, and any such adjustment
may provide for the elimination of fractional Rights.

                                   ARTICLE VI
                          GRANT AND EXERCISE OF RIGHTS

Section 6.1  RIGHTS GRANTS AND AGREEMENTS

Rights shall be granted by the Committee and the date of the grant shall be the
date of such Committee action. Each grant shall be evidenced by minutes of a
meeting or the written consent of the Committee and by a written Stock
Appreciation Rights Agreement dated as of the date of the grant and executed by
the Grantee and the Company, which Agreement shall set forth such terms and
conditions as may be determined by the Committee consistent with the Plan.

Section 6.2  RIGHTS VALUE

The value of each Right granted hereunder shall be determined by the Committee,
but said value shall not be less than the Fair Market Value of the Stock on the
date said Right is granted.

                                       4

<PAGE>

Section 6.3  RIGHTS PERIOD

The period for the exercise of each Right granted hereunder shall be determined
by the Committee, but in no instance shall such period exceed ten years from the
date of grant.

Section 6.4  PERFORMANCE CRITERIA

The grant, issuance, retention and or vesting of each Right may be subject to
such performance criteria and level of achievement versus these criteria as the
Committee shall determine, which criteria may be based on financial performance,
personal performance evaluations and/or completion of service by the Eligible
Employee

Section 6.5  RIGHTS EXERCISE

     (a) Rights granted hereunder may not be exercised unless and until the
Grantee shall have been or remained in the employ of the Company or its
Subsidiaries for one year from and after the date of grant of such Rights,
except as otherwise provided in Section 6.8 hereof or an individual Rights
agreement.

     (b) Rights granted hereunder may be exercised with respect to whole Rights
only, in such number and within the periods permitted for the exercise thereof
as determined by the Committee, and shall be exercised by written notice of
intent to exercise with respect to a specified number of Rights delivered to the
Company at its principal office in the State of California.

Section 6.6  PAYMENT FOR RIGHTS EXERCISED

Within 30 days after Rights have been exercised in accordance with Section 6.5
hereof, the Company shall pay to the Grantee in cash an amount equal to (i) the
amount, if any, by which the Fair Market Value of the Stock on the date such
Rights are exercised exceeds the value of each such Right established in
accordance with Section 6.2 hereof multiplied by (ii) the number of Rights
exercised, less all applicable federal and state withholding or other employment
taxes applicable to the taxable income of such Grantee resulting from such
exercise. In the event of the death of such Grantee before payment is made
hereunder, such payment shall be made to the executor or administrator of such
Grantee's estate.

Section 6.7  NONTRANSFERABILITY OF RIGHTS

Unless the agreement evidencing a Right (or an amendment thereto authorized by
the Committee) expressly states that it is transferable as provided hereunder,
no Right granted under the Plan, nor any interest in such Right, may be sold,
assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in
any manner, other than by will or the laws of descent and distribution, prior to
the vesting or lapse of any and all restrictions applicable to any Shares Rights
issued. The Committee may in its sole discretion grant a Right or amend an
outstanding Right to provide that the Right is transferable or assignable to a
member or members of the Eligible Employee's "immediate family", as such term is
defined under Exchange Act Rule 16a-1(e), or to a trust for the benefit solely
of a member or members of the Eligible Employee's immediate family, or to a
partnership or other entity whose only owners are members of the Eligible
Employee's family, provided that following any such transfer or assignment the
Right will remain subject to substantially the same terms applicable to the
Right while held by the Eligible Employee, as modified as the Committee in its
sole discretion shall determine appropriate, and such Eligible Employee shall
execute an agreement agreeing to be bound by such terms.

                                       5

<PAGE>

Section 6.8  CHANGE OF CONTROL

The Committee may through the terms of the Right or otherwise provide that any
or all of the following shall occur, either immediately upon the Change of
Control or a Change of Control Transaction, or upon termination of the Eligible
Employee's employment within twenty-four (24) months following a Change of
Control or a Change of Control Transaction: (a) the Eligible Employee's ability
to exercise any portion of the Right not previously exercisable and/or (b) the
lapse and expiration of any conditions to the grant, issuance, retention,
vesting or transferability of, or any other restrictions applicable to, such
Right. The Committee also may, through the terms of the Right or otherwise,
provide for an absolute or conditional exercise, payment or lapse of conditions
or restrictions on a Right which shall only be effective if, upon the
announcement of a Change of Control Transaction, no provision is made in such
Change of Control Transaction for the exercise, payment or lapse of conditions
or restrictions on the Right, or other procedure whereby the Participant may
realize the full benefit of the Right.

Section 6.9  NO RIGHTS AS SHAREHOLDER

Nothing herein contained shall be deemed to give any Grantee any rights as a
shareholder of the Company.

                                   ARTICLE VII
                      OTHER PROVISIONS APPLICABLE TO RIGHTS

Section 7.1  AGREEMENTS EVIDENCING RIGHTS

The Committee shall, subject to applicable law, determine the date a Right is
deemed to be granted. The Committee may establish the terms of agreements
evidencing Rights under this Plan and may, but need not, require as a condition
to any such agreement's effectiveness that such agreement be executed by the
Eligible Employee and that such Eligible Employee agree to such further terms
and conditions as specified in such agreement. The grant of a Right under this
Plan shall not confer any rights upon the Eligible Employee holding such Right
other than such terms, and subject to such conditions, as are specified in this
Plan as being applicable to such type of Right (or to all Rights) or as are
expressly set forth in the Agreement evidencing such Right.

Section 7.2  WITHHOLDING REQUIREMENTS

The Committee may make such provisions or impose such conditions as it may deem
appropriate for the withholding or payment by the Eligible Employee, as
appropriate, of any taxes which it determines are required in connection with
any Rights granted under this Plan, and an Eligible Employee's rights in any
Right are subject to satisfaction of such conditions.

                                  ARTICLE VIII
                 TERMINATION, AMENDMENT AND MODIFICATION OF PLAN

Section 8.1  TERMINATION, AMENDMENT AND MODIFICATION OF PLAN

The Board may at any time, upon recommendation of the Committee, terminate, and
may at any time and from time to time and in any respect amend or modify, the
Plan; provided, however, that no termination, amendment or modification of the
Plan shall in any manner affect any Rights theretofore granted under the Plan
without the consent of the Grantee.

                                       6

<PAGE>
                                   ARTICLE IX
                                  MISCELLANEOUS

Section 9.1  EMPLOYMENT

Nothing in the Plan or in any Rights granted hereunder or in any Stock
Appreciation Rights Agreement relating thereto shall confer upon any employee
the right to continue in the employ of the Company or any Subsidiary.

Section 9.2  OTHER COMPENSATION PLANS

The adoption of the Plan shall not affect any stock option or incentive or other
compensation plans in effect for the Company or any Subsidiary, nor shall the
Plan preclude the Company from establishing any other forms of incentive or
other compensation for employees of the Company or any Subsidiary.

Section 9.3  PLAN BINDING ON SUCCESSORS

The Plan shall be binding upon the successors and assigns of the Company.

Section 9.4  SINGULAR, PLURAL; GENDER

Whenever used herein, nouns in the singular shall include the plural, and the
masculine pronoun shall include the feminine gender.

Section 9.5  HEADINGS, ETC., NO PART OF PLAN

Headings of Articles and Sections hereof are inserted for convenience and
reference; they constitute no part of the Plan.

Section 9.6  GOVERNING LAW

This Plan and any agreements hereunder shall be interpreted and construed in
accordance with the laws of the State of Delaware and applicable federal law.
The Committee may provide that any dispute as to any Right shall be presented
and determined in such forum as the Committee may specify, including through
binding arbitration. Any reference in this Plan or in the agreement evidencing
any Right to a provision of law or to a rule or regulation shall be deemed to
include any successor law, rule or regulation of similar effect or
applicability.

                                       7

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