<PAGE>
                                                                    Exhibit 10.5


                         ONE LIBERTY PROPERTIES, INC.

                            1996 STOCK OPTION PLAN

1. Purpose.

            The purpose of this plan (the "Plan") is to secure for One Liberty
Properties, Inc. (the "Corporation") and its shareholders the benefits arising
from ownership of shares of Common Stock, $1.00 par value ("Common Stock") by
employees, officers and directors of, and consultants or advisors to, the
Corporation who are expected to contribute to the Corporation's future growth
and success. Except where the context otherwise requires, the term "Corporation"
shall include all present and future subsidiaries of the Corporation as defined
in Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended
or replaced from time to time (the "Code"). Those provisions of the Plan which
make express reference to Section 422 shall apply only to Incentive Stock
Options (as that term is defined in the Plan).

2. Type of Options and Administration.

            (a) Types of Options. Options granted pursuant to the Plan shall be
authorized by action of the Board of Directors of the Corporation and may be
either incentive stock options ("Incentive Stock Options") meeting the
requirements of Section 422 of the Code or non-statutory options which are not
intended to meet the requirements of Section 422 of the Code.

            (b) Administration. The Plan will be administered by the Audit and
Compensation Committee (the "Committee") appointed by the Board of Directors of
the Corporation (or any successor committee), whose construction and
interpretation of the terms and provisions of the Plan shall be final and
conclusive. The delegation of powers to the Committee shall be consistent with
applicable laws or regulations (including, without limitation, applicable state
law and Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the
"Exchange Act"), or any successor rule ("Rule 16b-3")). The Committee shall
have authority, subject to the express provisions
<PAGE>
of the Plan, to construe the respective option agreements and the Plan, to
prescribe, amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of the respective option agreements, which
need not be identical, and to make all other determinations in the judgment of
the Committee necessary or desirable for the administration of the Plan. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any option agreement in the manner and to the
extent it shall deem expedient to carry the Plan into effect and it shall be the
sole and final judge of such expediency. No director or person acting pursuant
to authority delegated by the Board of Directors shall be liable for any action
or determination under the Plan made in good faith. Subject to adjustment as
provided in Section 15 below, the aggregate number of shares of Common Stock
that may be granted to any person in a calendar year shall not exceed 25,000
Beneficial Shares.

            (c) Applicability of Rule 16b-3. Those provisions of the Plan which
make express reference to Rule 16b-3 shall apply to the Corporation only at such
time as the Corporation's shares of Common Stock are registered under the
Exchange Act, subject to the last sentence of Section 3(b), and then only to
such persons as are required to file reports under Section 16(a) of the Exchange
Act (a "Reporting Person").

3. Eligibility.

            (a) General. Options may be granted to persons who are, at the time
of grant, employees, officers or directors of, or consultants or advisors to,
the Corporation or any subsidiaries of the Corporation as defined in Sections
424(e) and 424(f) of the Code ("Participants") provided, that Incentive Stock
Options may only be granted to individuals who are employees of the Corporation
(within the meaning of Section 3401(c) of the Code). Subject to the limitation
contained in Section 2(b) above. A person who has been granted an option may, if
he or she is otherwise eligible, be granted additional options if the Committee
shall so determine.

            (b) Grant of Options to Reporting Persons. The selection of a
director or an officer who is a Reporting Person (as the terms "director" and
"officer" are defined for purposes of Rule 16b-3) as a recipient of an option,
the timing of the option grant, the exercise price of the option


                                      -2-

<PAGE>
and the number of shares subject to the option shall be determined either (i) by
the Board of Directors, or (ii) by a committee consisting solely of two or more
directors having full authority to act in the matter, each of whom shall be a
"Non-Employee Director" . For the purposes of the Plan, a director shall be
deemed to be a "Non-Employee Director" only if such person qualifies as a
"Non-Employee Director" as such term is defined in Rule 16b-3, as such term is
interpreted from time to time. If at least two of the members of the Board of
Directors do not qualify as a "Non-Employee Director" within the meaning of Rule
16b-3, as such term is interpreted from time to time, then the granting of
options to officers and directors who are Reporting Persons under the Plan shall
not be determined in accordance with this Section 3(b) but shall be determined
in accordance with the other provisions of the Plan.

4. Stock Subject to Plan.

            The stock subject to options granted under the Plan shall be shares
of authorized but unissued or reacquired Common Stock. Subject to adjustment as
provided in Section 15 below, the maximum number of shares of Common Stock of
the Corporation which may be issued and sold under the Plan is 125,000 shares.
If an option granted under the Plan shall expire, terminate or is cancelled for
any reason without having been exercised in full, the unpurchased shares subject
to such option shall again be available for subsequent option grants under the
Plan.

5. Forms of Option Agreements.

            As a condition to the grant of an option under the Plan, each
recipient of an option shall execute an option agreement in such form not
inconsistent with the Plan as may be approved by the Board of Directors or the
Committee. Such option agreements may differ among recipients.

6. Purchase Price.


                                      -3-

<PAGE>

            (a) General. The purchase price per share of stock deliverable upon
the exercise of an option shall be determined by the Board of Directors at the
time of grant of such option; provided, however, that in the case of an
Incentive Stock Option, the exercise price shall not be less than 100% of the
Fair Market Value (as hereinafter defined) of such stock, at the time of grant
of such option, or less than 110% of such Fair Market Value in the case of
options described in Section 11(b). "Fair Market Value" of a share of Common
Stock as of a specified date for the purposes of the Plan shall mean the closing
price of a share of Common Stock on the principal securities exchange (including
the Nasdaq National Market) on which such shares are traded on the day as of
which Fair Market Value is being determined, or on the next preceding date on
which such shares are traded if no shares were traded on such day, or if the
shares are not traded on a securities exchange, Fair Market Value shall be
deemed to be the average of the high bid and low asked prices of the shares in
the over-the-counter market on the day immediately preceding the date as of
which Fair Market Value is being determined or on the next preceding date on
which such high bid and low asked prices were recorded. If the shares are not
publicly traded, Fair Market Value of Beneficial Shares shall be determined in
good faith by the Board of Directors. In no case shall Fair Market Value be
determined with regard to restrictions other than restrictions which, by their
terms, will never lapse.

            (b) Payment of Purchase Price. Options granted under the Plan may
provide for the payment of the exercise price by delivery of cash or a check to
the order of the Corporation in an amount equal to the exercise price of such
options, or by any other means which the Board of Directors determines are
consistent with the purpose of the Plan and with applicable laws and regulations
(including, without limitation, the provisions of Rule 16b-3 and Regulation T
promulgated by the Federal Reserve Board).

7. Option Period.

            Subject to earlier termination as provided in the Plan, each option
and all rights thereunder shall expire on such date as determined by the Board
of Directors and set forth

                                      -4-
<PAGE>
in the applicable option agreement, provided, that such date shall not be later
than (10) ten years after the date on which the option is granted.

8. Exercise of Options.

            Each option granted under the Plan shall be exercisable either in
full or in installments at such time or times and during such period as shall be
set forth in the option agreement evidencing such option, subject to the
provisions of the Plan. No option granted to a Reporting Person for purposes of
the Exchange Act, however, shall be exercisable during the first six months
after the date of grant. Subject to the requirements in the immediately
preceding sentence, if an option is not at the time of grant immediately
exercisable, the Board of Directors may (i) in the agreement evidencing such
option, provide for the acceleration of the exercise date or dates of the
subject option upon the occurrence of specified events, and/or (ii) at any time
prior to the complete termination of an option, accelerate the exercise date or
dates of such option.

9. Transferability of Options.

            Incentive Stock Options granted under the Plan shall not be
assignable in whole or in part except by will or by the laws of descent and
distribution. Options granted under this Plan which are non-statutory options
shall be assignable or otherwise transferable by the optionee in whole or in
part (i) by will or by the laws of descent and distribution, (ii) pursuant to a
qualified domestic relations order as defined in the Code, (iii) pursuant to
Title I of the Employee Retirement Income Security Act, or the rules thereunder,
(iv) to the spouse, children, grandchildren or parents of the optionee
("Qualifying Relatives") or any trust created or existing for the benefit of the
optionee and/or one or more Qualifying Relatives, and (v) to any partnership or
limited liability company in which the optionee and/or one or more Qualifying
Relatives is a partner or member. The Board of Directors or the Committee, in
their discretion, may permit the transfer of options granted under the Plan to
other persons or entities, provided that Incentive Stock Options are not
assignable or otherwise transferable except by will or the laws of descent and
distribution.



                                      -5-
<PAGE>

            In the event an optionee dies during his employment by the
Corporation or any of its subsidiaries, or during the three-month period
following the date of termination of such employment, the option shall
thereafter be exercisable, during the period specified in the option agreement,
by his executors or administrators or by any assignee or transferee to the
extent to which such option was exercisable at the time of the optionee's death
during the periods set forth in Section 10 or 11(d).

10. Effect of Termination of Employment or Other Relationship.

            Except as provided in Section 11(d) with respect to Incentive Stock
Options and except as otherwise determined by the Committee at the date of grant
of an Option, and subject to the provisions of the Plan, an optionee (or any
permitted assignee or transferee of an option granted hereunder), may exercise
an option at any time within three months following the termination of the
optionee's employment or other relationship with the Corporation or within one
(1) year if such termination was due to the death or disability of the optionee
but, except in the case of the optionee's death, in no event later than the
expiration date of the Option. If the termination of the optionee's employment
is for cause or is otherwise attributable to a breach by the optionee of an
employment or confidentiality or non-disclosure agreement, the option shall
expire for all purposes and with respect to any assignee or transferee
immediately upon such termination. The Board of Directors shall have the power
to determine what constitutes a termination for cause or a breach of an
employment or confidentiality or non-disclosure agreement, whether an optionee
has been terminated for cause or has breached such an agreement, and the date
upon which such termination for cause or breach occurs. Any such determinations
shall be final and conclusive and binding upon the optionee and any assignee or
transferee of any option granted hereunder.

11. Incentive Stock Options.

            Options granted under the Plan which are intended to be Incentive
Stock Options shall be subject to the following additional terms and conditions:



                                      -6-
<PAGE>

            (a) Express Designation. All Incentive Stock Options granted under
the Plan shall, at the time of grant, be specifically designated as such in the
option agreement covering such Incentive Stock Options.

            (b) 10% Shareholder. If any person to whom an Incentive Stock Option
is to be granted under the Plan is, at the time of the grant of such option, the
owner of stock possessing more than 10% of the total combined voting power of
all classes of stock of the Corporation (after taking into account the
attribution of stock ownership rules of Section 424(d) of the Code), then the
following special provisions shall be applicable to the Incentive Stock Option
granted to such individual:

                  (i) The purchase price per share of Common Stock subject to
            such Incentive Stock Option shall not be less than 110% of the Fair
            Market Value of one share of Common Stock at the time of grant; and

                  (ii) the option exercise period shall not exceed five years
            from the date of grant.

            (c) Dollar Limitation. For so long as the Code shall so provide,
options granted under the Plan (and any other incentive stock option plans of
the Corporation) which are intended to constitute Incentive Stock Options shall
not constitute Incentive Stock Options to the extent that such options, in the
aggregate, become exercisable for the first time in any one calendar year for
shares of Common Stock with an aggregate Fair Market Value, as of the respective
date or dates of grant, of more than $100,000.

            (d) Termination of Employment, Death or Disability. No Incentive
Stock Option may be exercised unless, at the time of such exercise, the optionee
is, and has been continuously since the date of grant of his or her option,
employed by the Corporation, except that:


                                       -7-
<PAGE>

                  (i) an Incentive Stock Option may be exercised within the
            period of three months after the date the optionee ceases to be an
            employee of the Corporation (or within such lesser period as may be
            specified in the applicable option agreement), provided, that the
            agreement with respect to such option may designate a longer
            exercise period and that the exercise after such three-month period
            shall be treated as the exercise of a non-statutory option under the
            Plan;

                  (ii) if the optionee dies while in the employ of the
            Corporation, or within three months after the optionee ceases to be
            such an employee, the Incentive Stock Option may be exercised by the
            person to whom it is transferred by will or the laws of descent and
            distribution within the period of one year after the date of death
            (or within such lesser period as may be specified in the applicable
            option agreement); and

                  (iii) if the optionee becomes disabled (within the meaning of
            Section 22(e)(3) of the Code or any successor provisions thereto)
            while in the employ of the Corporation, the Incentive Stock Option
            may be exercised within the period of one year after the date the
            optionee ceases to be such an employee because of such disability
            (or within such lesser period as may be specified in the applicable
            option agreement).

For all purposes of the Plan and any option granted hereunder, "employment"
shall be defined in accordance with the provisions of Section 1.421-7(h) of the
Income Tax Regulations (or any successor regulations). Notwithstanding the
foregoing provisions, no Incentive Stock Option may be exercised after its
expiration date.

12. Additional Provisions.

                                      -8-

<PAGE>

            (a) Additional Option Provisions. The Board of Directors may, in its
sole discretion, include additional provisions in option agreements covering
options granted under the Plan, including without limitation, repurchase rights,
rights of first refusal, or such other provisions as shall be determined by the
Board of Directors; provided, that such additional provisions shall not be
inconsistent with any other term or condition of the Plan and such additional
provisions shall not cause any Incentive Stock Option granted under the Plan to
fail to qualify as an Incentive Stock Option within the meaning of Section 422
of the Code.

            (b) Acceleration, Extension, Etc. The Board of Directors may, in its
sole discretion, (i) accelerate the date or dates on which all or any particular
option or options granted under the Plan may be exercised or (ii) extend the
dates during which all, or any particular, option or options granted under the
Plan may be exercised; provided, however, that no such extension shall be
permitted if it would cause the Plan to fail to comply with Section 422 of the
Code or with Rule 16b-3 (if applicable).

13. General Restrictions.

            (a) Investment Representations. The Corporation may require any
person to whom an Option is granted, as a condition of exercising such option,
to give written assurances in substance and form satisfactory to the Corporation
to the effect that such person is acquiring the shares of Common Stock subject
to the option or award, for his or her own account for investment and not with
any present intention of selling or otherwise distributing the same, and to such
other effects as the Corporation deems necessary or appropriate in order to
comply with federal and applicable state securities laws.

            (b) Compliance With Securities Law. Each Option shall be subject to
the requirement that if, at any time, counsel to the Corporation shall determine
that the listing, registration or qualification of the shares subject to such
option upon any securities exchange or automated quotation system or under any

                                      -9-

<PAGE>
state or federal law, or the consent or approval of any governmental or
regulatory body, or that the disclosure of non-public information or the
satisfaction of any other condition is necessary as a condition of, or in
connection with the issuance or purchase of shares thereunder, such option may
not be exercised, in whole or in part, unless such listing, registration,
qualification, consent or approval, or satisfaction of such condition shall have
been effected or obtained on conditions acceptable to the Board of Directors.
Nothing herein shall be deemed to require the Corporation to apply for or to
obtain such listing, registration or qualification, or to satisfy such
condition.

14. Rights as a Stockholder.

            The holder of an option shall have no rights as a stockholder with
respect to any shares covered by the option (including, without limitation, any
rights to receive dividends or non-cash distributions with respect to such
shares) until the date of issue of a stock certificate to him or her for such
shares. No adjustment shall be made for dividends or other rights for which the
record date is prior to the date such stock certificate is issued.

15. Adjustment Provisions for Recapitalizations, Reorganizations and Related
    Transactions.

            (a) Recapitalizations and Related Transactions. If, through or as a
result of any recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased, decreased or exchanged for a different number or
kind of shares or other securities of the Corporation, or (ii) additional shares
or new or different shares or other non-cash assets are distributed with respect
to such shares of Common Stock or other securities, an appropriate and
proportionate adjustment shall be made in (x) the maximum number and kind of
shares reserved for issuance under or otherwise referred to in the Plan, (y) the
number and kind of shares or other securities subject to any then outstanding
options under the Plan, and (z) the price for each share subject to any then
outstanding options under the Plan, without changing the aggregate purchase
price as to which such options remain exercisable. Notwithstanding the
foregoing, no adjustment shall be made pursuant to this Section 15 if such


                                      -10-
<PAGE>
adjustment (i) would cause the Plan to fail to comply with Section 422 of the
Code or with Rule 16b-3 or (ii) would be considered as the adoption of a new
plan requiring stockholder approval.

            (b) Reorganization, Merger and Related Transactions. All outstanding
Options under the Plan shall become fully exercisable for a period of sixty (60)
days following the occurrence of any Trigger Event, whether or not such Options
are then exercisable under the provisions of the applicable agreements relating
thereto. For purposes of the Plan, a "Trigger Event" is any one of the following
events:

                        (i) the date on which shares of Common Stock are first
            purchased pursuant to a tender offer or exchange offer (other than
            such an offer by the Corporation, any Subsidiary, any employee
            benefit plan of the Corporation or of any Subsidiary or any entity
            holding shares of Common Stock or other securities of the
            Corporation for or pursuant to the terms of such plan), whether or
            not such offer is approved or opposed by the Corporation and
            regardless of the number of shares purchased pursuant to such offer;

                        (ii) the date the Corporation acquires knowledge that
            any person or group deemed a person under Section 13(d)-3 of the
            Exchange Act (other than the Corporation, any Subsidiary, any
            employee benefit plan of the Corporation or of any Subsidiary or any
            entity holding shares of Common Stock or other securities of the
            Corporation for or pursuant to the terms of any such plan or any
            individual or entity or group or affiliate thereof which acquired
            its beneficial ownership interest prior to the date the Plan was
            adopted by the Board), in a transaction or series of transactions,
            has become the beneficial owner, directly or indirectly (with
            beneficial ownership determined as provided in Rule 13d-3, or any
            successor rule, under the Exchange Act), of securities of the
            Corporation entitling the person or group to 30% or more of all
            votes (without consideration of the rights of any class or stock to
            elect directors

                                      -11-
<PAGE>
            by a separate class vote) to which all shareholders of the
            Corporation would be entitled in the election of the Board of
            Directors were an election held on such date;

                        (iii) the date, during any period of two consecutive
            years, when individuals who at the beginning of such period
            constitute the Board of Directors of the Corporation cease for any
            reason to constitute at least a majority thereof, unless the
            election, or the nomination for election by the stockholders of the
            Corporation, 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 such period; and

                        (iv) the date of approval by the stockholders of the
            Corporation of an agreement (a "reorganization agreement") providing
            for:

                        (A) The merger or consolidation of the Corporation with
            another corporation where the stockholders of the Corporation,
            immediately prior to the merger or consolidation, do not
            beneficially own, immediately after the merger or consolidation,
            shares of the entity issuing cash or securities in the merger or
            consolidation entitling such shareholders to 80% or more of all
            votes (without consideration of the rights of any class of stock to
            elect directors by a separate class vote) to which all stockholders
            of such corporation would be entitled in the election of directors
            or where the members of the Board of Directors of the Corporation,
            immediately prior to the merger or consolidation, do not,
            immediately after the merger or consolidation, constitute a majority
            of the Board of Directors of the entity issuing cash or securities
            in the merger or consolidation; or

                        (B) The sale or other disposition of all or
            substantially all the assets of the Corporation.

            (c) Board Authority to Make Adjustments. Any adjustments under this
Section 15 will be made by the Board of Directors, whose determination as to
what adjustments, if


                                      -12-

<PAGE>
any, will be made and the extent thereof will be final, binding and conclusive.
No fractional shares will be issued under the Plan on account of any such
adjustments.

16. Merger, Consolidation, Asset Sale, Liquidation, etc.

            (a) General. In the event of any sale, merger, transfer or
acquisition of the Corporation or substantially all of the assets of the
Corporation in which the Corporation is not the surviving entity, and provided
that after the Corporation shall have requested the acquiring or succeeding
entity (or an affiliate thereof), that equivalent options shall be substituted
and such successor entity shall have refused or failed to assume all options
outstanding under the Plan or issue substantially equivalent options, then any
or all outstanding options under the Plan shall accelerate and become
exercisable in full immediately prior to such event. The Committee will notify
holders of options under the Plan that any such options shall be fully
exercisable for a period of fifteen (15) days from the date of such notice, and
the options will terminate upon expiration of such notice.

            (b) Substitute Options. The Corporation may grant options under the
Plan in substitution for options held by employees of another entity who become
employees of the Corporation, or a subsidiary of the Corporation, as the result
of a merger or consolidation of the employing entity with the Corporation or a
subsidiary of the Corporation, or as a result of the acquisition by the
Corporation, or one of its subsidiaries, of property or stock of the employing
entity. The Corporation may direct that substitute options be granted on such
terms and conditions as the Board of Directors considers appropriate in the
circumstances.

17. No Special Employment Rights.

            Nothing contained in the Plan or in any option shall confer upon any
optionee any right with respect to the continuation of his or her employment by
the Corporation or interfere in any way with the right of the Corporation at any
time to terminate such employment or to increase or decrease the compensation of
the optionee.


                                      -13-
<PAGE>

18. Other Employee Benefits.

            Except as to plans which by their terms include such amounts as
compensation, the amount of any compensation deemed to be received by an
employee as a result of the exercise of an option or the sale of shares received
upon such exercise will not constitute compensation with respect to which any
other employee benefits of such employee are determined, including, without
limitation, benefits under any bonus, pension, profit-sharing, life insurance or
salary continuation plan, except as otherwise specifically determined by the
Board of Directors.

19. Amendment of the Plan.

            (a) The Board of Directors may at any time, and from time to time,
modify or amend the Plan in any respect; provided, however, that if at any time
the approval of the stockholders of the Corporation is required under Section
422 of the Code or any successor provision with respect to Incentive Stock
Options, the Board of Directors may not effect such modification or amendment
without such approval.

            (b) The modification or amendment of the Plan shall not, without the
consent of an optionee, affect his or her rights under an option previously
granted to him or her. With the consent of the optionee affected, the Board of
Directors may amend outstanding option agreements in a manner not inconsistent
with the Plan. The Board of Directors shall have the right to amend or modify
(i) the terms and provisions of the Plan and of any outstanding Incentive Stock
Options granted under the Plan to the extent necessary to qualify any or all
such options for such favorable federal income tax treatment (including deferral
of taxation upon exercise) as may be afforded incentive stock options under
Section 422 of the Code and (ii) the terms and provisions of the Plan and of any
outstanding option to the extent necessary to ensure the qualification of the
Plan under Rule 16b-3.


                                      -14-
<PAGE>
20. Withholding.

            (a) The Corporation shall have the right to deduct from payments of
any kind otherwise due to the optionee any federal, state or local taxes of any
kind required by law to be withheld with respect to any shares issued upon
exercise of options under the Plan. Subject to the prior approval of the
Corporation, which may be withheld by the Corporation in its sole discretion,
the optionee may elect to satisfy such obligations, in whole or in part, (i) by
causing the Corporation to withhold shares of Common Stock otherwise issuable
pursuant to the exercise of an option or (ii) by delivering to the Corporation
shares of Common Stock already owned by the optionee. The shares so delivered or
withheld shall have a Fair Market Value equal to such withholding obligation as
of the date that the amount of tax to be withheld is to be determined. An
optionee who has made an election pursuant to this Section 20(a) may only
satisfy his or her withholding obligation with shares of Common Stock which are
not subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirements.

            (b) The acceptance of shares of Common Stock upon exercise of an
Incentive Stock Option shall constitute an agreement by the optionee (i) to
notify the Corporation if any or all of such shares are disposed of by the
optionee within two years from the date the option was granted or within one
year from the date the shares were issued to the optionee pursuant to the
exercise of the option, and (ii) if required by law, to remit to the
Corporation, at the time of and in the case of any such disposition, an amount
sufficient to satisfy the Corporation's federal, state and local withholding tax
obligations with respect to such disposition, whether or not, as to both (i) and
(ii), the optionee is in the employ of the Corporation at the time of such
disposition.

            (c) Notwithstanding the foregoing, in the case of a Reporting Person
whose options have been granted in accordance with the provisions of Section
3(b) herein, no election to use shares for the payment of withholding taxes
shall be effective unless made in compliance with any applicable requirements of
Rule 16b-3.




                                      -15-
<PAGE>
21. Cancellation and New Grant of Options, Etc.

            The Board of Directors shall have the authority to effect, at any
time and from time to time, with the consent of the affected optionees, (i) the
cancellation of any or all outstanding options under the Plan and the grant in
substitution therefor of new options under the Plan covering the same or
different numbers of shares and having an option exercise price per share which
may be lower or higher than the exercise price per share of the cancelled
options or (ii) the amendment of the terms of any and all outstanding options
under the Plan to provide an option exercise price per share which is higher or
lower than the then-current exercise price per share of such outstanding
options.

22. Effective Date and Duration of the Plan.

            (a) Effective Date. The Plan shall become effective when adopted by
the Board of Directors, but no Incentive Stock Option granted under the Plan
shall become exercisable unless and until the Plan shall have been approved by
the Corporation's stockholders. If such stockholder approval is not obtained
within twelve months after the date of the Board's adoption of the Plan, no
options previously granted under the Plan shall be deemed to be Incentive Stock
Options and no Incentive Stock Options shall be granted thereafter. Amendments
to the Plan not requiring stockholder approval shall become effective when
adopted by the Board of Directors; amendments requiring shareholder approval (as
provided in Section 21) shall become effective when adopted by the Board of
Directors, but no Incentive Stock Option granted after the date of such
amendment shall become exercisable (to the extent that such amendment to the
Plan was required to enable the Corporation to grant such Incentive Stock Option
to a particular optionee) unless and until such amendment shall have been
approved by the Corporation's stockholders. If such stockholder approval is not
obtained within twelve months of the Board's adoption of such amendment, any
Incentive Stock Options granted on or after the date of such amendment shall
terminate to the extent that such amendment to the Plan was required to enable
the Corporation to grant such option to a



                                      -16-
<PAGE>
particular optionee. Subject to this limitation, options may be granted under
the Plan at any time after the effective date and before the date fixed for
termination of the Plan.

            (b) Termination. Unless sooner terminated in accordance with Section
16, the Plan shall terminate upon the earlier of (i) the close of business on
the day next preceding the tenth anniversary of the date of its adoption by the
Board of Directors, or (ii) the date on which all shares available for issuance
under the Plan shall have been issued pursuant to the exercise or cancellation
of options granted under the Plan. If the date of termination is determined
under (i) above, then options outstanding on such date shall continue to have
force and effect in accordance with the provisions of the instruments evidencing
such options.

23. Governing Law.

            The provisions of this Plan shall be governed and construed in
accordance with the laws of the State of Maryland.

            Adopted by the Board of Directors on December 6, 1996


                                      -17-