Exhibit 10.6

                            GREATER COMMUNITY BANCORP
                         2001 EMPLOYEE STOCK OPTION PLAN


                               ARTICLE I. PURPOSES
                                          --------

     The purposes of the Greater  Community  Bancorp 2001 Employee  Stock Option
Plan are to (i)  attract  and  retain  highly  qualified  employees,  (ii) align
employee and stockholder  long-term  interests by creating a direct link between
employee  compensation and stockholder return, (iii) enable employees of Greater
Community  Bancorp (the "Company") and its  Subsidiaries to develop and maintain
stock ownership  positions in the Company,  and (iv) provide  incentives to such
employees to contribute to the Company's  success.  To achieve these objectives,
the Plan  provides  for the granting of  "incentive  stock  options"  within the
meaning  of  Section  422 of the  Internal  Revenue  Code of 1986,  as  amended,
"nonqualified stock options" and "stock appreciation rights."

                             ARTICLE II. DEFINITIONS
                                         -----------

     Whenever  the  following  terms are used in this Plan,  they shall have the
meanings specified below:

     (a) "Affiliate" shall mean the Company or a Subsidiary.

     (b) "Board" shall mean the Company's Board of Directors.

     (c) "Cause" shall mean (i) the conviction of the Participant of a felony by
a court of competent  jurisdiction,  (ii) the indictment of the Participant by a
State or Federal  grand  jury of  competent  jurisdiction  for  embezzlement  or
misappropriation  of funds of an Affiliate or for any act of  dishonesty or lack
of  fidelity  towards  an  Affiliate,   (iii)  the  written  confession  by  the
Participant of any act of dishonesty towards an Affiliate or any embezzlement or
misappropriation  of an Affiliate's  funds,  or (iv) willful or gross neglect of
the duties for which the Participant was  responsible,  all as the Board, in its
sole discretion, may determine.

     (d) "Change in  Control"  shall mean the  occurrence  of one or more of the
following events:  (i) the Company acquires actual knowledge that any person (as
such term is used in Sections  13(d)(3) and 14(d)(2) of the Exchange  Act) other
than an Affiliate is or becomes the  beneficial  owner (as defined in Rule 13d-3
of the Exchange  Act),  directly or  indirectly,  of  securities  of the Company
representing  more than 25% of the combined  voting power of the Company's  then
outstanding  securities;  (ii) the first  purchase of Common Stock pursuant to a
tender or  exchange  offer  (other  than a tender or  exchange  offer made by an
Affiliate);  (iii) the approval by the Company's stockholders of (a) a merger or
consolidation of the


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Company with or into another  corporation  (other than a merger or consolidation
in which the  Company is the  surviving  entity and which does not result in any
reclassification  or reorganization of the Company's then outstanding  shares of
Common Stock or a change in the Company's directors,  other than the addition of
not  more  than  three  directors),   (b)  a  sale  or  disposition  of  all  or
substantially  all of the  Company's  assets,  or (c) a plan of  liquidation  or
dissolution of the Company;  (iv) during any period of two consecutive  calendar
years,  individuals  who at the  beginning of such period  constitute  the Board
cease for any  reason to  constitute  at least  two-thirds  thereof,  unless the
election or nomination  for the election by the Company's  stockholders  of each
new director was approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of the period; or (v) a sale
of (a) Common Stock if after such sale any person (as defined  above) other than
an Affiliate owns a majority of the Common Stock or (b) all or substantially all
of the Company's assets (other than in the ordinary course of business).

     (e) "Code" shall mean the Internal  Revenue Code of 1986,  as now in effect
or as  hereafter  amended.  (All  citations  to sections of the Code are to such
sections as they may from time to time be amended or renumbered.)

     (f) "Committee"  shall mean the committee  consisting of at least three (3)
directors of the Company  appointed by the Board to administer the Plan pursuant
to the provisions of Article III of the Plan.

     (g) "Common Stock" shall mean the Company's  common stock,  which has a par
value of $0.50 per share.

     (h) "Company" shall mean Greater Community  Bancorp, a New Jersey currently
business corporation.

     (i)  "Disability"  shall mean permanent and total  disability as defined by
the Company's  employee  welfare  benefit plan  offering a long-term  disability
benefit,  or, if no such benefit is offered,  as defined by Section 105(d)(4) of
the Code (prior to the repeal of such Section). "Disability" shall also exist if
documented by a signed written  opinion of a currently  licensed  medical doctor
reasonably  satisfactory  to the Board,  which written  opinion shall set forth,
without  limitation,  a medical  opinion  that the  Participant  is  permanently
disabled, the reasons for such disability,  and the date of commencement of such
disability.

     (j)  "Employee"  shall mean a common law employee (as defined in accordance
with the regulations  and Revenue Rulings then applicable  under Section 3401(c)
of the Code) of an Affiliate.

     (k) "Exchange Act" shall mean the  Securities  Exchange Act of 1934, as now
in effect or as hereafter amended.




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     (l) "Fair Market Value of Stock" shall mean for all purposes of the Plan as
follows:  (A) if the Shares are admitted to quotation on the Nasdaq Stock Market
or other  comparable  quotation  system  and have  been  designated  as a Nasdaq
National  Market  ("NMM")  security,  fair market value on any date shall be the
last sale price  reported  for the Shares on such  system on such date or on the
last day preceding such date on which a sale was reported; (B) if the Shares are
admitted to quotation on the Nasdaq Stock Market and have not been designated an
NMM security,  fair market value on any date shall be the average of the highest
bid and lowest  asked  prices of the Shares on such system on such date;  (C) if
the Shares are  admitted  to trading  on a national  securities  exchange,  fair
market value on any date shall be the last sale price reported for the Shares on
such  exchange on such date or on the last date  preceding  such date on which a
sale was  reported;  or (D) if neither  (A),  (B) nor (C) applies to the Shares,
fair  market  value on any date shall be a price  equal to the mean  between the
closing bid and asked prices for Shares,  as quoted in writing to the Company by
either (i) a principal  market maker for transactions in the Bank's Common Stock
on the  over-the-counter  market  designated  by the  Board or (ii)  such  other
registered broker-dealer firm as is designated by the Board or the Committee.

     (m) "Incentive  Stock Option" shall mean a Stock Option whose terms satisfy
the requirements  imposed by Section 422 of the Code and that is intended by the
Committee to be treated as an Incentive Stock Option.

     (n)  "Nonqualified  Stock  Option"  shall mean either (i) any Stock  Option
that, when granted, is not an Incentive Stock Option, or (ii) an Incentive Stock
Option that,  subsequent to its grant,  ceases to qualify as an Incentive  Stock
Option because of a failure to satisfy the requirements of Section 422(b) of the
Code.

     (o) "Non-Tandem Stock  Appreciation  Right" shall mean a Stock Appreciation
Right not awarded in connection with a Stock Option.

     (p)  "Participant"  shall  mean an  Employee  who has been  granted a Stock
Option and/or Stock Appreciation Right under the Plan.

     (q) "Plan" shall mean the Greater  Community  Bancorp 2001  Employee  Stock
Option Plan, as may be amended from time to time.

     (r) "Retirement" shall mean any normal or early retirement by a Participant
pursuant to the terms of any pension,  profit  sharing or 401(k) plan, or policy
of the Company or any Subsidiary  applicable to such  Participant at the time of
his Termination of Service.

     (s) "Secretary" shall mean the Company's corporate secretary.

     (t)  "Securities  Act" shall  mean the  Securities  Act of 1933,  as now in
effect or as hereafter amended.





<PAGE>


     (u) "Shares" shall mean shares of Common Stock.

     (v) "Stock Appreciation Right" shall mean a right to receive cash or Common
Stock in exchange for a Stock  Appreciation Right awarded in accordance with the
terms of the Plan.

     (w) "Stock  Option" shall mean a right to purchase  Common Stock awarded in
accordance with the terms of this Plan.

     (x) "Subsidiary(ies)" shall mean any corporation, limited liability company
or other legal entity, domestic or foreign, more than 50% of the voting power of
which is owned or controlled, directly or indirectly by the Company.

     (y) "Tandem Stock Appreciation Right" shall mean a Stock Appreciation Right
awarded in connection  with any Stock Option  granted under the Plan,  either at
the time the Stock  Option is  granted  or  thereafter  at any time prior to the
exercise, termination or expiration of the related Stock Option.

     (z) "Terminate  (Termination of) Service (or  Termination)"  shall mean the
time when the  Participant  ceases to provide  services  to an  Affiliate  as an
Employee, but shall not include a lapse in providing services that the Committee
determines to be a temporary leave of absence.

                           ARTICLE III. ADMINISTRATION
                                        --------------

     Except as may be  otherwise  determined  by the  Board,  the Plan  shall be
administered  by a committee (the  "Committee")  of three or more members of the
Board appointed by the Board who qualify as both (i) a "disinterested person" or
similar person within the meaning of the rules  promulgated  under Section 16(b)
of the  Exchange  Act as in  effect  from  time to  time  and  (ii) an  "outside
director"  within the meaning of Section 162(m) of the Code. The Committee shall
hold meetings at such times as may be necessary for the proper administration of
the Plan and shall keep  minutes of its  meetings.  A majority of the  Committee
shall constitute a quorum and a majority of the quorum present at any meeting of
the  Committee may  authorize  any action.  No member of the Committee  shall be
personally liable for any action,  determination or interpretation  made in good
faith with  respect to the Plan or any Stock Option  and/or  Stock  Appreciation
Right granted pursuant  thereto.  The Company shall indemnify all members of the
Committee with respect to any such action,  determination or  interpretation  to
the fullest extent permitted by law.

     Subject  to the  provisions  of the Plan,  the  Committee  shall  have sole
authority, in its absolute discretion: (i) to determine which eligible Employees
shall be granted Stock Options and/or Stock Appreciation  Rights;  (ii) to grant
Stock Options  and/or Stock  Appreciation  Rights;  (iii) to determine the times
when Stock  Options  and/or  Stock  Appreciation  Rights may be granted  and the
number of Shares that may be purchased pursuant to such Stock Options and/or the
number of



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Shares associated with Stock Appreciation Rights; (iv) to determine the exercise
price of the Shares subject to each Stock Option,  which price shall be not less
than the minimum  specified in Section  6.1; (v) to determine  the time or times
when each Stock Option and/or Stock Appreciation Right becomes exercisable,  the
duration of the exercise period,  and any other  restrictions on the exercise of
Stock  Options  and/or  Stock  Appreciation  Rights  issued  hereunder;  (vi) to
prescribe the form or forms of the Stock Option and/or Stock Appreciation Rights
agreements under the Plan; (vii) to determine the circumstances  under which the
time for  exercising  Stock Options and/or Stock  Appreciation  Rights should be
accelerated and to accelerate the time for exercising  outstanding Stock Options
and/or Stock Appreciation Rights;  (viii) to determine the duration and purposes
for leaves of absence that may be granted to a Participant without  constituting
a  Termination  of Service for  purposes of the Plan;  (ix) to adopt,  amend and
rescind such rules and regulations  as, in its opinion,  may be advisable in the
administration  of the Plan;  and (x) to construe and  interpret  the Plan,  the
rules  and  regulations  and the Stock  Option  and  Stock  Appreciation  Rights
agreements under the Plan, and to make all other determinations deemed necessary
or advisable for the administration of the Plan;  provided,  however,  that with
respect to those  eligible  Employees  who are not  "officers"  of the  Company,
within the meaning of Section  16(b) of the  Exchange  Act,  the  Committee  may
delegate  to any  person  or  persons  ("Subcommittee")  all or any  part of its
authority as set forth in (i) through (x) above.  All  references in the Plan to
the powers of a Subcommittee  to act for the Committee  shall be applicable only
to the extent  consistent  with the  foregoing  provision and only to the extent
consistent  with the  powers  that  have  actually  been  delegated  to it.  All
decisions, determinations and interpretations of the Committee, or Subcommittee,
to the extent consistent with such delegation, shall be final and binding on all
Participants and on their legal representatives and beneficiaries.

     The  provisions  of this Article III shall survive any  termination  of the
Plan.

                       ARTICLE IV. SHARES SUBJECT TO PLAN
                                   ----------------------

     The  aggregate  maximum  number of Shares that may be made subject to Stock
Options and Non-Tandem Stock Appreciation Rights granted pursuant to the Plan is
Three  Hundred  Thousand  (300,000)  (or the  number and kind of Shares or other
securities  substituted  for those  Shares or to which those Shares are adjusted
pursuant to the provisions of Article X of the Plan).  The Company shall reserve
such  number of Shares for the  purposes of the Plan out of its  authorized  but
unissued shares, or out of Shares held in the Company's treasury,  or partly out
of each,  as shall be determined  by the Board.  No  fractional  Shares shall be
issued with respect to Stock Options or Stock Appreciation  Rights granted under
the Plan.

     In the event any outstanding Stock Option or Stock Appreciation Right under
the Plan for any reason expires,  is terminated,  forfeited or is canceled prior
to the







<PAGE>


expiration date of the Plan, the Shares called for by the unexercised portion of
such Stock Option or Stock  Appreciation  Right may, to the extent  permitted by
Rule 16b-3 under the Exchange  Act,  again be subject to a Stock Option or Stock
Appreciation Right under the Plan.

                ARTICLE V. ELIGIBILITY FOR AWARD OF STOCK OPTIONS
                           --------------------------------------
                        AND/OR STOCK APPRECIATION RIGHTS
                        --------------------------------

     All officers who are  Employees  and other  Employees of one or more of the
Affiliates shall be eligible to receive Stock Options and/or Stock  Appreciation
Rights  under  the  Plan.   Nonemployee  directors  shall  not  be  eligible  to
participate in the Plan.  However, a person who otherwise is an eligible officer
or Employee shall not be disqualified  from  participation in the Plan by virtue
of being a director of the Company or any Subsidiary.

                    ARTICLE VI. GRANT OF STOCK OPTIONS AND/OR
                                -----------------------------
                            STOCK APPRECIATION RIGHTS
                            -------------------------

     The  Committee  or  Subcommittee  may in its sole  discretion  grant  Stock
Options  and/or Stock  Appreciation  Rights to such  Employees as it  determines
appropriate  consistent with Article V. Stock Options and/or Stock  Appreciation
Rights  shall be evidenced by Stock  Option  and/or  Stock  Appreciation  Rights
agreements (which need not be identical) in such forms as the Committee may from
time to time approve.

     Stock Option and/or Stock  Appreciation  Right  agreements shall conform to
the terms and conditions of the Plan. Such agreements may provide that the grant
of any Stock Option  and/or  Stock  Appreciation  Right under the Plan,  or that
Stock  acquired  pursuant  to the  exercise  of any Stock  Option  and/or  Stock
Appreciation  Right,  shall be subject to such other conditions  (whether or not
applicable  to the  Stock  Option  and/or  Stock  Appreciation  Right,  or Stock
received by any other  Participant),  as the Committee  determines  appropriate,
including,  without  limitation,   provisions  conditioning  exercise  upon  the
occurrence of certain events or  performance or the passage of time,  provisions
to assist the  participant  in  financing  the  purchase  of Stock  through  the
exercise of Stock Options,  provisions for forfeiture, or restrictions on resale
or other disposition,  of Shares acquired under the Plan,  provisions giving the
Company the right to repurchase  Shares acquired under the Plan in the event the
Participant  elects to dispose of such  Shares,  and  provisions  to comply with
Federal and State  securities  laws and  Federal and State  income tax and other
payroll tax withholding requirements.  Stock Options granted under the Plan that
are  intended  to qualify  as  Incentive  Stock  Options  shall be  specifically
designated as such in the stock option agreement.

6.1 OPTION  PRICE OF STOCK  OPTIONS.  The  exercise  price for each Stock Option
granted under the Plan shall be  determined  by the  Committee or  Subcommittee;
provided, however, that it shall not be less than the greater of the







<PAGE>

Fair  Market  Value of the  Stock  on the date of grant or the par  value of the
Stock.  Notwithstanding the foregoing, the Committee may in its discretion grant
Nonqualified  Stock Options to purchase up to Fifty Thousand  (50,000) shares at
the greater of (i) the Stock's  Fair Market  Value on December  19, 2000 or (ii)
eighty-five  percent  (85%)  of the  Stock's  Fair  Market  Value on the date of
adoption of the Plan.

6.2 EXERCISABILITY AND TERMS OF STOCK OPTIONS AND/OR STOCK APPRECIATION  RIGHTS.
The Committee or Subcommittee shall, subject to the terms of the Plan, determine
the dates after which Stock  Options  and/or  Stock  Appreciation  Rights may be
exercised,  in whole or in part, and may establish a vesting  schedule that must
be  satisfied  before Stock  Options  and/or  Stock  Appreciation  Rights may be
exercised;  provided,  however,  that no Stock Option and/or Stock  Appreciation
Right may be exercisable within six months of the date it is granted, other than
in the event of an  acceleration  as  provided  in Section  6.3. A Stock  Option
and/or  Stock  Appreciation  Right  may  provide  that if it is  exercisable  in
installments,  installments  that are exercisable and not exercised shall remain
exercisable  during the term of the Stock Option  and/or the Stock  Appreciation
Right.

     All  Incentive  Stock  Options  shall have a term of no more than ten years
from the date of grant.  Upon the Termination of Service of a Participant due to
(i) voluntary  resignation  or  involuntary  dismissal  without  Cause,  or (ii)
Retirement,  all Stock Options  and/or Stock  Appreciation  Rights that have not
become exercisable  before the date the Participant  Terminates Service shall be
forfeited  and  terminated  immediately.  The  Participant  may exercise a Stock
Option and/or Stock  Appreciation  Right to the extent it was exercisable by him
on the date immediately  preceding such Termination within the lesser of (i) one
month from the date of  Termination  (six months from the date of Termination in
the case of  Retirement),  or (ii) the  balance of the stated  term of the Stock
Option and/or Stock Appreciation  Right. If a Participant's  employment shall be
terminated  with Cause,  all Stock  Options  and/or  Stock  Appreciation  Rights
granted  to  such  Participant  that  have  not  been  exercised  prior  to such
Termination  for  Cause  shall,   whether  or  not  exercisable,   be  forfeited
immediately upon such Termination.

6.3  ACCELERATED   VESTING  AND   EXERCISABILITY  OF  STOCK  OPTIONS  AND  STOCK
APPRECIATION  RIGHTS.  If a Participant shall Terminate Service by reason of his
death or Disability,  all Stock Options and/or Stock Appreciation Rights granted
to such  Participant  that have not become  exercisable on or before the date of
such Termination shall immediately  become both "vested" and fully  exercisable.
All Stock Options and/or Stock Appreciation  Rights held by such Participant may
be  exercised  by  the   Participant,   his  estate  or   beneficiary,   or  his
representative,  as the case may be,  for a period  of one year from the date of
such  Termination,  or until the  expiration  of the  stated  term of such Stock
Options and/or Stock Appreciation Rights, whichever period is shorter.




<PAGE>


     Notwithstanding  the provisions of Section 6.2, in the event of a Change in
Control, any Stock Option and/or Stock Appreciation Right granted under the Plan
to a Participant  that has not, as of the date of the Change in Control,  become
exercisable shall immediately become both "vested" and fully exercisable.

6.4  NONTRANSFERABILITY  OF STOCK OPTIONS AND/OR STOCK  APPRECIATION  RIGHTS. No
Stock Option or Stock Appreciation Right shall be transferable except by will or
the laws of descent and  distribution.  During the  Participant's  lifetime  the
Stock Option and/or Stock  Appreciation  Right shall be exercisable  only by him
or, in the event of the Participant's  incapacity or death, by the Participant's
guardian or legal  representative.  More specifically,  without  limitation,  no
Stock  Option  and/or  Stock  Appreciation  Right may be  assigned,  transferred
(except as specifically permitted by the Plan or the terms of the specific Stock
Option or Stock Appreciation Right agreement  consistent with the Plan), pledged
or  hypothecated  in any way, nor shall it be  assignable by operation of law or
subject to execution, attachment,  garnishment or similar process. Any attempted
assignment,  transfer,  pledge,  hypothecation  or other  disposition of a Stock
Option and/or Stock  Appreciation  Right contrary to the provisions  hereof, and
the levy of any execution,  attachment,  garnishment or similar process upon the
Stock  Option  and/or  Stock  Appreciation  Right,  shall be null and void,  and
without force or effect.  The Committee may,  however,  in its sole  discretion,
allow for transfers of Nonqualified Stock Options, Non-Tandem Stock Appreciation
Rights,  and  Tandem  Stock  Appreciation   Rights  issued  in  connection  with
Non-Qualified  Stock Options to family  members,  subject to such  conditions or
limitations as the Board may establish.

6.5 NO OBLIGATION TO EXERCISE  STOCK OPTIONS AND/OR STOCK  APPRECIATION  RIGHTS.
The grant of a Stock  Option  and/or  Stock  Appreciation  Right shall impose no
obligation  on the  Participant  to  exercise  such Stock  Option  and/or  Stock
Appreciation Right.

6.6  CANCELLATION  OF  STOCK  OPTIONS  AND/OR  STOCK  APPRECIATION  RIGHTS.  The
Committee,  or  Subcommittee,  in its  discretion,  may, with the consent of any
Participant,  cancel any  outstanding  Stock Option  and/or  Stock  Appreciation
Right.

6.7 NO RIGHTS AS A STOCKHOLDER.  A Participant or a transferee of a Stock Option
and/or  Stock  Appreciation  Right  shall have no rights as a  stockholder  with
respect to any Share covered by his Stock Option and/or Stock Appreciation Right
until he shall have become the holder of record of such Share,  and he shall not
be entitled to any dividends or distributions or other rights in respect of such
Share  for  which the  record  date is prior to the date on which he shall  have
become the holder of record thereof.

6.8 SPECIAL PROVISIONS  APPLICABLE TO INCENTIVE STOCK OPTIONS. To the extent the
aggregate Fair Market Value (determined as of the time the Stock




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Option is granted) of the Stock with respect to which any Stock Options  granted
hereunder that are intended to be Incentive Stock Options may be exercisable for
the first time by the  Participant  in any calendar year (under this Plan or any
other  stock  option plan of the  Company or any parent or  Subsidiary  thereof)
exceeds  $100,000 (or such other  maximum  level as may be set forth in the Code
for such purpose),  such Stock Options shall not be considered  Incentive  Stock
Options.

     No Incentive  Stock Option may be granted to an individual who, at the time
the Stock Option is granted,  owns directly, or indirectly within the meaning of
Section  424(d)of the Code,  stock  possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company or of any parent or
Subsidiary  thereof,  unless such Stock  Option (i) has an exercise  price of at
least 110 percent of the Fair Market Value of the Stock on the date of the grant
of such Stock  Option,  and (ii) cannot be exercised  more than five years after
the date it is granted.

     Each  participant  who  receives an  Incentive  Stock  Option must agree to
notify  the  Company  in  writing  immediately  after  the  Participant  makes a
disqualifying  disposition of any Stock acquired  pursuant to the exercise of an
Incentive  Stock  Option.   A  disqualifying   disposition  is  any  disposition
(including  any sale) of such Stock  before the later of (i) two years after the
date the  Participant  was granted the  Incentive  Stock Option or (ii) one year
after the date the Participant  acquired Stock by exercising the Incentive Stock
Option. Any transfer of ownership to a broker or nominee shall be deemed to be a
disposition unless the Participant  provides proof satisfactory to the Committee
of his continued beneficial ownership of the Stock.

     Any  other  provision  of the  Plan  to the  contrary  notwithstanding,  no
Incentive  Stock  Option shall be granted more than ten years after the date the
Plan is  adopted  or the date  the  Company's  stockholders  approve  the  Plan,
whichever is earlier.

6.9  DEFERRED  EXERCISE OF STOCK  OPTIONS AND STOCK  APPRECIATION  RIGHTS.  If a
Participant's  timely  exercise of a  Nonqualified  Stock  Option  and/or  Stock
Appreciation Right during a given taxable year, together with other compensation
paid to the  Participant  for such  year,  would  result in a  disallowance  for
Federal  income  tax  purposes,  pursuant  to Section  402(m) of the Code,  of a
deduction  to the  Company  of all or part  of the  Participant's  income  to be
recognized  during such taxable year for Federal  income tax purposes  upon such
exercise,  then such  Participant's  exercise of such Nonqualified  Stock Option
and/or Stock  Appreciation Right shall be ineffective and such exercise shall be
automatically  deferred  (except to the  extent  specifically  permitted  by the
Committee)  beyond  the end of such  taxable  year of the  Company to the extent
necessary to avoid such disallowance of a deduction to the Company. The deferral
of exercise of a  Nonqualified  Stock  Option  and/or Stock  Appreciation  Right
provided by this Section 6.9 shall be until the next succeeding  taxable year in
which




<PAGE>


the Company is not denied a tax deduction related to such exercise. The deferral
of exercise is for the  Company's  benefit and  therefore  supersedes  any other
limitation  on  exercisability  that may be set forth in any other  provision of
this Plan or any Stock Option or Stock Appreciation Right agreement.

                     ARTICLE VII. EXERCISE OF STOCK OPTIONS
                                  -------------------------

     Any  Stock  Option  may be  exercised  in  whole  or in  part  at any  time
subsequent to its becoming exercisable during its term; provided,  however, that
each partial exercise shall be for whole Shares only. Each Stock Option,  or any
exercisable portion thereof,  may only be exercised by delivery to the Secretary
or the Secretary's office of (i) notice in writing signed by the Participant (or
other  person  then  entitled  to exercise  such Stock  Option)  that such Stock
Option, or a specified portion thereof, is being exercised; (ii) payment in full
for the  purchased  Shares (as  specified  in  Section  7.2  below);  (iii) such
representations and documents as are necessary or advisable to effect compliance
with  all  applicable   provisions  of  Federal  or  State  securities  laws  or
regulations; (iv) in the event that the Stock Option or portion thereof shall be
exercised pursuant to Section 6.3 or 6.4 by any person or persons other than the
Participant,  appropriate  proof  of the  right of such  person  or  persons  to
exercise  the Stock  Option or  portion  thereof;  and (v) full  payment  to the
Company of all amounts that  Federal or State law  requires it to withhold  upon
exercise of the Stock Option (as specified in Section 7.3 below).

7.1 SHARE  CERTIFICATES.  Upon  receiving  notice and payment,  the Company will
cause to be delivered to the Participant,  as soon as practicable, a certificate
in the  Participant's  name for the Shares  purchased.  The Shares  issuable and
deliverable  upon  the  exercise  of a Stock  Option  shall  be  fully  paid and
nonassessable.  The  Company  shall  not be  required  to issue or  deliver  any
certificate or  certificates  for Shares  purchased upon the complete or partial
exercise of the Stock Option prior to  fulfillment  of (i) the completion of any
registration  or other  qualification  of such Shares under any Federal or State
law or under rulings or regulations of the Securities and Exchange Commission or
of any other  governmental  regulatory  body that may be necessary or advisable;
and (ii) the  obtaining of any approval or other  clearance  from any Federal or
State governmental agency that may be necessary or advisable.

7.2 PAYMENT  FOR  SHARES.  Payment  for Shares  purchased  under a Stock  Option
granted  hereunder  shall be made in full upon exercise of the Stock Option,  by
certified or bank cashier's check payable to the order of the Company or, unless
otherwise prohibited by the terms of a Stock Option agreement, by one or more of
the following:  (i) in the form of Shares already owned by the Participant based
in any such instance on the Fair Market Value of the Stock on the date the Stock
Option is exercised;  provided, however, that, in the case of an Incentive Stock
Option,  the right to make a payment in the form of already  owned Shares may be
authorized  only at the time the Stock Option is granted;  (ii) by a combination
thereof,  in each case in the manner provided in the Stock Option agreement;  or
(iii)




<PAGE>


by any other means  acceptable  to the  Company.  To the extent the Stock Option
exercise price may be paid in Shares as provided above,  Shares delivered by the
Participant may be (i) Shares  received by the Participant  upon exercise of one
or more Incentive  Stock Options,  but only if such Shares have been held by the
Participant  until the later of (a) two years from the date the Incentive  Stock
Options  were  granted  or (b) one year  after  the  transfer  of  Shares to the
Participant,  or (ii) Shares received by the Participant upon exercise of one or
more Nonqualified  Stock Options and/or Stock  Appreciation  Rights, but only if
such Shares have been held by the Participant for at least six months.

7.3 SHARE WITHHOLDING. The Committee shall require that a Participant pay to the
Company,  at the time of exercise of a  Nonqualified  Stock Option  and/or Stock
Appreciation  Right, such amount as the Committee deems necessary to satisfy the
Company's obligation to withhold Federal or State income or other taxes incurred
by reason of the exercise or the transfer of Shares thereupon. A Participant may
satisfy such  withholding  requirements by having the Company  withhold from the
number of Shares  otherwise  issuable  upon  exercise of the Stock Option and/or
Stock  Appreciation  Right that number of shares having an aggregate fair market
value on the date of exercise equal to the minimum amount  required by law to be
withheld;  provided,  however,  that in the case of an exercise by a Participant
who is subject to Section 16(b) of the Exchange Act, such  Participant  must (i)
exercise the Stock Option and/or the Stock  Appreciation Right during the period
beginning on the third  business day  following the date of release to the press
of the  quarterly or annual  summary of earnings for the Company,  and ending on
the twelfth  business day  following  such date,  or (ii)  irrevocably  elect to
utilize Share withholding at least six months prior to the date of exercise.

7.4 LOANS. The Company may make loans to such Participants as the Committee,  in
its  discretion,  may determine in connection with the exercise of Stock Options
granted  under  the  Plan;  provided,  however,  that the  Committee  shall  not
authorize the making of any loan where the possession of such  discretion or the
making of such loan  would  either  result in a  "modification"  (as  defined in
Section 424 of the Code) of any Incentive  Stock Option or disqualify such Stock
Option from otherwise qualifying as an Incentive Stock Option. Such loans may be
subject  to the  following  terms  and  conditions  and  such  other  terms  and
conditions as the Committee shall determine not inconsistent with the Plan. Such
loans may bear interest at such rates as the Committee shall determine from time
to time, which rates may be below then current market rates. In no event may any
such loan exceed the  exercise  price,  at the date of  exercise,  of the Shares
covered by the Stock Option or portion  thereof  exercised  by the  Participant.
When a loan shall have been made,  the  Committee  may  require  that  Shares of
Common Stock and/or other  collateral  having a fair market value at least equal
to the principal  amount of the loan shall be pledged by the  Participant to the
Company as security  for payment of the unpaid  balance of the loan.  Every loan
shall also comply with all applicable  laws,  regulations and rules of the Board
of Governors of the Federal  Reserve  System and any other  governmental  agency
having jurisdiction thereof.





<PAGE>


            ARTICLE VIII. EXERCISE OF TANDEM STOCK APPRECIATION RIGHT
                          -------------------------------------------

     A Tandem Stock  Appreciation  Right shall be exercisable only to the extent
that the related  Stock Option is  exercisable.  Each Tandem Stock  Appreciation
Right, or any exercisable portion thereof,  may only be exercised by delivery to
the Secretary or the  Secretary's  office of (i) notice in writing signed by the
Participant  (or other  person  then  entitled to  exercise  such  Tandem  Stock
Appreciation  Right) that such Tandem Stock  Appreciation  Right, or a specified
portion thereof, is being exercised;  (ii) such representations and documents as
are necessary or advisable to effect  compliance with all applicable  provisions
of Federal or State securities laws or regulations;  (iii) in the event that the
Tandem Stock  Appreciation  Right or portion thereof shall be exercised pursuant
to  Section  6.3 or 6.4 by any person or  persons  other  than the  Participant,
appropriate  proof of the right of such person or persons to exercise the Tandem
Stock  Appreciation  Right or  portion  thereof;  and (iv) full  payment  to the
Company  of all  amounts  Federal  or State law  requires  it to  withhold  upon
exercise of the Stock Appreciation Right (as specified in Section 7.3).

     On exercise of a Tandem Stock  Appreciation  Right,  the Participant  shall
surrender  unexercised,  the related  Stock  Option (or such portion or portions
thereof that the Participant  from time to time determines to surrender for this
purpose) and shall receive in exchange,  subject to the rules and regulations as
from time to time may be  established  by the  Committee,  a  payment  having an
aggregate  value  equal to (A) the  excess of (i) the Fair  Market  Value of the
Stock on the  exercise  date per share over (ii) the Option Price of the related
Stock Option per share, times (B) the number of Shares called for by the related
Stock Option or portion thereof that is surrendered.

     The  payment  due the  Participant  upon the  exercise  of a  Tandem  Stock
Appreciation  Right shall be made (i) in cash, (ii) in Common Stock (valued with
reference  to the Fair  Market  Value of Stock as of the date of  exercise),  or
(iii)  partly in cash and partly in Common Stock  (valued with  reference to the
Fair Market Value of Stock as the date of exercise),  as set forth by the Tandem
Stock  Appreciation  Right  agreement,   and  by  the  Committee,  in  its  sole
discretion.  If the payment is to be made in Common Stock, no fractional  shares
of  Common  Stock  shall be  issued  and cash  payment  shall be made in lieu of
fractional shares.  Notwithstanding  any provision in this Plan to the contrary,
in the case of an exercise of a Tandem Stock Appreciation Right by a Participant
subject to Section 16(b) of the Exchange Act, such  Participant may exercise the
Tandem Stock  Appreciation  Right only during the period  beginning on the third
business  day  following  the date of release to the press of the  quarterly  or
annual summary of earnings for the Company,  and ending on the twelfth  business
day following such date.

     Any Shares  issuable  and  deliverable  upon the exercise of a Tandem Stock
Appreciation Right shall be fully paid and nonassessable.  The Company shall not
be  required  to issue or  deliver  any  certificate  or  certificates  upon the
complete or




<PAGE>


partial  exercise of a Tandem Stock  Appreciation  Right prior to fulfillment of
(i) the completion of any  registration  or other  qualification  of such Shares
under any Federal or State law or under rulings or regulations of the Securities
and Exchange Commission or of any other governmental regulatory body the Company
may deem necessary or advisable; and (ii) the obtaining of any approval or other
clearance  from any  Federal or State  governmental  agency the Company may deem
necessary or advisable.

     No payment  shall be required from the  Participant  upon the exercise of a
Tandem Stock  Appreciation  Right,  except that any amount  necessary to satisfy
applicable  Federal,  state or local tax requirements  shall be withheld or paid
prior to or concurrently with delivery of cash or Shares.

     Upon the  exercise  of a Tandem  Stock  Appreciation  Right,  the number of
Shares subject to exercise under the related Stock Option shall automatically be
reduced  by the  number of Shares  represented  by the Stock  Option or  portion
thereof  surrendered.  Shares  subject  to Stock  Options  or  portions  thereof
surrendered upon the exercise of a Tandem Stock  Appreciation Right shall not be
available for subsequent awards under this Plan.

     Notwithstanding  any  contrary  provision  in this  Plan,  a  Tandem  Stock
Appreciation  Right shall be issued in connection with an Incentive Stock Option
only if the Tandem Stock Appreciation Right meets the following requirements:

     (a) The  Tandem  Stock  Appreciation  Right  will  expire no later than the
expiration of the underlying Incentive Stock Option;

     (b) The  Tandem  Stock  Appreciation  Right  provides  for a payment to the
Participant  not in excess of the  difference  between the exercise price of the
underlying  Incentive Stock Option and the Fair Market Value of Stock subject to
the underlying  Incentive Stock Option at the time the Tandem Stock Appreciation
Right is exercised;

     (c) The  Tandem  Stock  Appreciation  Right is  transferable  only when the
underlying   Incentive  Stock  Option  is  transferable,   and  under  the  same
conditions;

     (d) The Tandem  Stock  Appreciation  Right may be  exercised  only when the
underlying Stock Option is eligible to be exercised; and

     (e) The Tandem Stock Appreciation Right may be exercised only when the Fair
Market Value of Stock subject to the Incentive Stock Option exceeds the exercise
price of the Incentive Stock Option.

          ARTICLE IX. EXERCISE OF NON-TANDEM STOCK APPRECIATION RIGHT
                      -----------------------------------------------

<PAGE>

     Each  Non-Tandem  Stock  Appreciation  Right,  or any  exercisable  portion
thereof,  may only be exercised by delivery to the Secretary or the  Secretary's
office of (i) notice in writing signed by the  Participant (or other person then
entitled  to  exercise  such  Non-Tandem  Stock  Appreciation  Right)  that such
Non-Tandem Stock  Appreciation  Right, or a specified portion thereof,  is being
exercised; (ii) such representations and documents as are necessary or advisable
to  effect  compliance  with  all  applicable  provisions  of  Federal  or State
securities  laws  or  regulations;  (iii)  in the  event  the  Non-Tandem  Stock
Appreciation Right or portion thereof shall be exercised pursuant to Section 6.3
or 6.4 by any person or persons other than the Participant, appropriate proof of
the  right  of  such  person  or  persons  to  exercise  the  Non-Tandem   Stock
Appreciation  Right or portion thereof;  and (iv) full payment to the Company of
all amounts required by Federal or State law to be withhold upon exercise of the
Stock Appreciation Right (as specified in Section 7.3).

     On exercise of a Non-Tandem Stock Appreciation Right, the Participant shall
receive,  subject  to the  rules  and  regulations  as from  time to time may be
established by the Committee,  a payment having an aggregate  value equal to (A)
the excess of (i) the Fair Market Value of Stock on the exercise  date over (ii)
the Fair  Market  Value of Stock on the date of grant,  times (B) the  number of
Shares  that are  subject  to the  Non-Tandem  Stock  Appreciation  Right  being
exercised.

     The payment due the  Participant  upon the  exercise of a Non- Tandem Stock
Appreciation  Right shall be made (i) in cash, (ii) in Common Stock (valued with
reference  to the Fair  Market  Value of Stock as of the date of  exercise),  or
(iii)  partly in cash and partly in Common Stock  (valued with  reference to the
Fair  Market  Value  of  Stock as the  date of  exercise),  as set  forth by the
Non-Tandem Stock  Appreciation  Right agreement and by the Committee in its sole
discretion.  If the payment is to be made in Common Stock, no fractional  shares
of  Common  Stock  shall be  issued  and cash  payment  shall be made in lieu of
fractional shares.  Notwithstanding  any contrary provision in this Plan, in the
case of an exercise of a Non-Tandem  Stock  Appreciation  Right by a Participant
who is  subject to Section  16(b) of the  Exchange  Act,  such  Participant  may
exercise  the  Non-Tandem  Stock  Appreciation  Right  only  during  the  period
beginning on the third  business day  following the date of release to the press
of the  quarterly or annual  summary of earnings for the Company,  and ending on
the twelfth business day following such date.

     Any Shares issuable and deliverable upon the exercise of a Non-Tandem Stock
Appreciation Right shall be fully paid and nonassessable.  The Company shall not
be  required  to issue or  deliver  any  certificate  or  certificates  upon the
complete or partial exercise of a Non-Tandem Stock  Appreciation  Right prior to
fulfillment of (i) the completion of any registration or other  qualification of
such Shares under any Federal or State law or under  rulings or  regulations  of
the Securities and Exchange  Commission or of any other governmental  regulatory
body that the Company may deem necessary or advisable; and (ii) the obtaining of






<PAGE>

any approval or other  clearance from any Federal or State  governmental  agency
the Company may deem necessary or advisable.

     No payment  shall be required from the  Participant  upon the exercise of a
Non-Tandem Stock Appreciation Right, except that any amount necessary to satisfy
applicable  Federal,  state or local tax requirements  shall be withheld or paid
prior to or concurrently with delivery of cash or Shares.

                ARTICLE X. ADJUSTMENT FOR RECAPITALIZATION, ETC.
                           ------------------------------------

     The  aggregate  number  of  Shares  that may be  purchased  under  the Plan
pursuant to Stock Options or issued pursuant to Stock  Appreciation  Rights, the
number of Shares covered by each outstanding Stock Option and Stock Appreciation
Right,  and the exercise price of each Stock Option and the Fair Market Value of
Stock on the date of grant of a  Non-Tandem  Stock  Appreciation  Right shall be
appropriately adjusted for any increase or decrease in the number of outstanding
Shares  resulting from a stock split or other  subdivision or  consolidation  of
Shares or for other  capital  adjustments  or  payments  of stock  dividends  or
distributions,  other increases or decreases in the outstanding  Shares effected
without receipt of consideration by the Company,  or  reorganization,  merger or
consolidation, or other similar change affecting the Shares.

     Such adjustment to a Stock Option or Stock Appreciation Right shall be made
without a change to the  total  exercise  price  applicable  to the  unexercised
portion of the Stock Option or total value applicable to the unexercised portion
of a Stock  Appreciation  Right  (except for any change in the  aggregate  price
resulting from rounding-off of Share quantities or prices).  Any such adjustment
made by the  Committee  shall be final and binding  upon all  Participants,  the
Company, their representatives,  and all other interested persons. No fractional
Shares shall be issued as a result of such adjustment.

     In the event of a transaction  involving (i) the liquidation or dissolution
of the Company,  (ii) a merger or  consolidation in which the Company is not the
surviving  corporation or (iii) the sale or disposition of all or  substantially
all of the Company's  assets,  provision  shall be made in connection  with such
transaction for the assumption of Stock Options and/or Stock Appreciation Rights
theretofore  granted under the Plan, or the  substitution for such Stock Options
and/or Stock Appreciation  Rights of new Stock Options and/or Stock Appreciation
Rights of the  successor  corporation,  with  appropriate  adjustment  as to the
number and kind of Shares and the purchase price for Shares  thereunder,  or, in
the  Committee's  discretion,  the  Plan  and the  Stock  Options  and/or  Stock
Appreciation  Rights issued  hereunder  shall terminate on the effective date of
such transaction if appropriate provision is made for payment to the Participant
of an amount in cash equal to the fair market value of a Share multiplied by the
number of Shares subject to the Stock Options or Stock  Appreciation  Rights (to
the  extent  such  Stock  Options  or Stock  Appreciation  Rights  have not been
exercised)  less the exercise  price for such Stock  Options (to the extent such
Stock Options have not been  exercised) or the Fair Market Value of the Stock on
the date of grant of such Stock  Appreciation  Rights (to





<PAGE>


the extent such Stock  Appreciation  Rights have not been exercised);  provided,
however,  that in no event  shall  the  Committee  take any  action  or make any
determination under this Article X that would prevent a transaction described in
clause (ii) or (iii) above from being  treated as a pooling of  interests  under
generally accepted accounting principles, if applicable to the transaction.

          ARTICLE XI. GOVERNMENT REGULATIONS AND REGISTRATION OF SHARES
                      -------------------------------------------------

     The  Plan,  and the  grant  and  exercise  of Stock  Options  and/or  Stock
Appreciation  Rights  thereunder,  and the  Company's  obligations  to sell  and
deliver  Shares  and to make  payments  under such Stock  Options  and/or  Stock
Appreciation  Rights, shall be subject to all applicable Federal and State laws,
rules and  regulations  and to such approvals by any regulatory or  governmental
agency as may be required.

     Each  Stock  Option  and/or  Stock  Appreciation  Right is  subject  to the
requirement  that if, at any time,  the  Committee  determines,  in its absolute
discretion,  that the listing,  registration or qualification of Shares issuable
pursuant to the Plan is required by any  securities  exchange,  The Nasdaq Stock
Market or any similar trading market or exchange,  or under any State or Federal
law, or the consent or approval of any governmental regulatory body is necessary
or desirable as a condition of, or in connection  with,  the issuance of Shares,
no  Shares  shall  be  issued,  in  whole  or  in  part,  unless  such  listing,
registration,  qualification, consent or approval has been effected or obtained,
free of any conditions not acceptable to the Committee. The Company shall not be
deemed, by reason of the granting of any Stock Option and/or Stock  Appreciation
Right,  to have any  obligation  to  register  the Shares  subject to such Stock
Option and/or Stock  Appreciation  Right under the Securities Act or to maintain
in effect any registration of such Shares that may be made at any time under the
Securities Act.

     Unless a registration statement under the Securities Act and the applicable
rules and regulations thereunder is then in effect with respect to Shares issued
upon  exercise  of any Stock  Option  and/or  Stock  Appreciation  Right  (which
registration  shall not be  required),  the Company shall require that the offer
and sale of such Shares be exempt from the registration  provisions of said Act.
In  furtherance  of such  exemption,  the  Company may  require,  as a condition
precedent to the exercise of any Stock Option and/or Stock  Appreciation  Right,
that the person exercising the Stock Option and/or Stock Appreciation Right give
to the Company written representation and undertaking,  satisfactory in form and
substance to the Company,  that such person is acquiring  the Shares for his own
account for investment and not with a view to the distribution or resale thereof
and otherwise establish to the Company's  satisfaction that the offer or sale of
the Shares issuable upon exercise of the Stock Option and/or Stock  Appreciation
Right



<PAGE>


will not  constitute or result in any breach or violation of the  Securities Act
or any similar State act or statute or any rules or regulations  thereunder.  In
the  event a  Registration  Statement  under the  Securities  Act is not then in
effect with respect to the Shares  issued upon exercise of a Stock Option and/or
Stock Appreciation  Right, the Company shall place upon any stock certificate an
appropriate  legend  referring  to the  restrictions  on  disposition  under the
Securities Act.

     The  Company  is  relieved  from  any  liability  for  the  nonissuance  or
nontransfer  or any delay in issuance or transfer of any Shares subject to Stock
Options  and/or  Stock  Appreciation  Rights under the Plan  resulting  from the
Company's inability to obtain, or in any delay in obtaining, from any regulatory
body having  jurisdiction,  all requisite  authority to issue or transfer Shares
upon exercise of the Stock Options  and/or Stock  Appreciation  Rights under the
Plan if counsel  for the  Company  deems  such  authority  necessary  for lawful
issuance or transfer of any such  Shares.  Appropriate  legends may be placed on
the stock  certificates  evidencing Shares issued upon exercise of Stock Options
and/or Stock Appreciation Rights to reflect such transfer restrictions.

                          ARTICLE XII. OTHER PROVISIONS
                                      -----------------

     The validity,  interpretation and administration of the Plan and any rules,
regulations,  determinations or decisions made thereunder, and the rights of any
and all persons  having or claiming to have any interest  therein or thereunder,
shall be determined  exclusively in accordance with the laws of the State of New
Jersey.

     As used herein, the masculine gender shall include the feminine gender.

     The  headings  in the Plan are for  reference  purposes  only and shall not
affect the meaning or interpretation of the Plan.

     All  notices or other  communications  made or given  pursuant to this Plan
shall be in writing and shall be sufficiently made or given if hand-delivered or
mailed by certified mail,  addressed to any Participant at the address contained
in the records of the Company or to the Company at its principal office.

     The proceeds received from the sale of Shares pursuant to the Plan shall be
used for general corporate purposes.

     Nothing in the Plan or in any Stock Option and/or Stock  Appreciation Right
granted hereunder shall confer on any Participant or eligible Employee any right
to  continue  in the  employ of the  Company or any of its  Subsidiaries,  or to
interfere in any way with the right of the Company or any of its Subsidiaries to
terminate such Participant's or Employee's employment at any time.

     The Plan is  intended  to comply  with  Rule  16b-3  promulgated  under the
Exchange Act and the Committee shall interpret and administer the provisions of





<PAGE>

the  Plan or any  Stock  Option  and/or  Stock  Appreciation  Right  in a manner
consistent  therewith.  Any  provisions  inconsistent  with such  Rule  shall be
inoperative and shall not affect the validity of the Plan.

     All expenses and costs  incurred in  connection  with the  operation of the
Plan shall be borne by the Company.

     The  adoption  of the Plan  shall  not  affect  any other  compensation  or
incentive  plans in effect for the  Affiliates,  or any of them.  Nothing in the
Plan shall be construed to limit the right of any  Affiliate  (i) to  establish,
alter or terminate any other forms of incentives,  benefits or compensation  for
Employees,  including,  without  limitation,  conditioning  the right to receive
other incentives, benefits or compensation on an Employee's not participating in
the Plan; or (ii) to grant or assume  options  otherwise  than under the Plan in
connection with any proper corporate purpose, including, without limitation, the
grant or  assumption  of stock options in  connection  with the  acquisition  by
purchase, lease, merger,  consolidation or otherwise, of the business, stock, or
assets of any corporation, firm or association.

     If the  Committee  or  Subcommittee  shall find that any person to whom any
benefit  is due or  payable  under the Plan is  unable  to care for his  affairs
because of illness or accident, or is a minor, or has died, then any payment due
to such person or his estate  (unless a prior claim  therefor has been made by a
duly appointed legal  representative),  may, if the Committee or Subcommittee so
directs the Company,  be paid to his spouse,  child,  relative,  an  institution
maintaining or having custody of such person,  or any other person deemed by the
Committee to be a proper recipient on behalf of such person  otherwise  entitled
to payment.  Any such payment shall be a complete  discharge of the liability of
the Committee and the Company therefor.

                      ARTICLE XIII. EFFECTIVE DATE OF PLAN
                                    ----------------------

     The Plan is  effective  as of the  earlier of its date of  adoption  by the
Board  or  its  approval  by  the  Company's  stockholders  in  accordance  with
applicable State and federal law.

                ARTICLE XIV. AMENDMENT OR DISCONTINUANCE OF PLAN
                             -----------------------------------

         The Board may, without the consent of the Company's stockholders or
Participants under the Plan, at any time terminate the Plan entirely, and at any
time or from time to time amend or modify the Plan, provided that no such action
shall adversely affect Stock Options and/or Stock Appreciation Rights
theretofore granted hereunder without the Participant's consent, and provided
further that no such action by the Board, without approval of the stockholders,
may (i) materially increase the total number of Shares that may be purchased or
acquired pursuant to Stock Options and/or Stock Appreciation Rights granted
under the Plan, either in







<PAGE>

the  aggregate  or  for  any  Participant  or  eligible   Employee,   except  as
contemplated  in  Article  X; (ii)  expand the class of  employees  eligible  to
receive Stock Options  and/or Stock  Appreciation  Rights under the Plan;  (iii)
decrease the minimum Stock Option exercise  price;  (iv) extend the maximum term
of Stock Options and/or Stock Appreciation Rights granted hereunder; or (v) take
any other  action  requiring  stockholder  approval  under Rule 16b-3  under the
Exchange  Act. No amendment  or  modification  may become  effective if it would
cause the Plan to fail to meet any applicable  requirements  of Rule 16b-3 under
the Exchange Act.

                        ARTICLE XV. STOCKHOLDER APPROVAL
                                    --------------------

     Anything in the Plan to the  contrary  notwithstanding,  the grant of Stock
Options  and/or  Stock  Appreciation  Rights  hereunder  shall be of no force or
effect,  and no Stock Option and/or Stock  Appreciation  Right granted hereunder
shall vest or become  exercisable  in any respect,  unless and until the Plan is
approved  by the  affirmative  vote of the  holders of a majority  of the Shares
present,  in person  or by  proxy,  and  entitled  to vote at a  meeting  of the
stockholders of the Company duly held in accordance with the laws of New Jersey.