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                                                                    EXHIBIT 10.4



                            MEDICAL RESOURCES, INC.

                             1996 STOCK OPTION PLAN

     1.  Purpose.  The purpose of this Plan is to strengthen Medical Resources,
         -------
Inc. by providing an incentive to its employees, consultants and directors,
encouraging them to devote their abilities to the success of the Company.  It is
intended that this purpose be achieved by extending to employees, consultants
and directors of the Company or any subsidiary an added long-term incentive for
high levels of performance and exceptional efforts through the grant of options
to purchase shares of the Company's common stock under this Medical Resources,
Inc. 1996 Stock Option Plan.

     2.  Definitions.  For purposes of the Plan:
         -----------

     2.1.  "Agreement" means the written agreement between the Company and an
Optionee evidencing the grant of an Option and setting forth the terms and
conditions thereof.

     2.2.  "Board" means the Board of Directors of the Company.

     2.3.  "Cause" means with respect to an Eligible Employee, including an
Eligible Employee who is a director of the Company, (i) the voluntary
termination of employment by such Eligible Employee, (ii) intentional failure to
perform, or habitual neglect of, reasonably assigned duties, (iii) dishonesty or
willful misconduct in the performance of an Optionee's duties, (iv) an
Optionee's engaging in a transaction in connection with the performance of such
Optionee's duties to the Company or any of its Subsidiaries thereof which
transaction is adverse to the interests of the Company or any of its
Subsidiaries and which is engaged in for personal profit to the Optionee, (v)
willful violation of any law, rule or regulation in connection with the
performance of an Optionee's duties, (vi) willful violation of any policy
adopted by the Company relating to the performance or behavior of employees or
(vii) acts of carelessness or misconduct which have in the reasonable judgment
of the Company's Board of Directors, an adverse effect on the Company.

     2.4.  "Change in Capitalization" means any increase or reduction in the
number of Shares, or any change (including, but not limited to, a change in
value) in the Shares or exchange of Shares for a different number or kind of
shares or other securities of the Company, by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, spin-off, split-up,
issuance of warrants or rights or debentures, stock dividend, stock split or
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reverse stock split, cash dividend, property dividend, combination or exchange
of shares, repurchase of shares, public offering, private placement, change in
corporate structure or otherwise.

     2.5.  "Code" means the Internal Revenue Code of 1986, as amended.

     2.6.  "Committee" means a committee consisting of at least two (2)
Disinterested Directors appointed by the Board to administer the Plan and to
perform the functions set forth herein.

     2.7.  "Company" means Medical Resources, Inc.

     2.8.  "Consultant Option" means an Option granted to a consultant pursuant
to Section 7.

     2.9.  "Director Option" means an Option granted to a Nonemployee Director
pursuant to Section 5.

     2.10.  "Disability" means a physical or mental infirmity which impairs the
Optionee's ability to perform substantially his or her duties for a period of
sixty (60) consecutive days.

     2.11.  "Disinterested Director" means a director of the Company who is
"disinterested" within the meaning of Rule 16b-3 under the Exchange Act.

     2.12.  "Eligible Employee" means an officer or other employee of the
Company or a Subsidiary who is designated by the Committee as eligible to
receive Options subject to the conditions set forth herein.

     2.13.  "Employee Options" means an Option granted to an Eligible Employee
pursuant to Section 6.

     2.14.  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

     2.15.  "Fair Market Value" on any date means the average of the high and
low sales prices of the Shares on such date on the principal national securities
exchange on which such Shares are listed or admitted to trading, or if such
Shares are not so listed or admitted to trading, the arithmetic mean of the per
Share closing bid price and per Share closing asked price on such date as quoted
on the National Association of Securities Dealers Automated Quotation System or
such other market in which such prices are regularly quoted, or, if there have
been no published bid or asked quotations with respect to Shares on such date,
the Fair Market Value shall be the value established by the Board in good faith
and in accordance with Section 422 of the Code.

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     2.16.  "Incentive Stock Option" means an Option satisfying the requirements
of Section 422 of the Code and designated by the Committee as an Incentive Stock
Option.

     2.17.  "Nonqualified Stock Option" means an Option which is not an
Incentive Stock Option.

     2.18.  "Nonemployee Director" means a director of the Company who is not an
employee of the Company or any Subsidiary.

     2.19.  "Option" means an Employee Option, a Director Option, a Consultant
Option or any or all of them.

     2.20.  "Optionee" means a person to whom an Option has been granted under
the Plan.

     2.21.  "Parent" means any corporation which is a parent corporation (within
the meaning of Section 424(e) of the Code) with respect to the Company.

     2.22.  "Plan" means the Medical Resources, Inc. 1996 Stock Option Plan.

     2.23.  "Shares" means the common stock, par value $.01 per share, of the
Company.

     2.24.  "Subsidiary" means any corporation which is a subsidiary corporation
(within the meaning of Section 424(f) of the Code) with respect to the Company.

     2.25.  "Successor Corporation" means a corporation, or a parent or
subsidiary thereof within the meaning of Section 424(a) of the Code, which
issues or assumes a stock option in a transaction to which Section 424(a) of the
Code applies.

     2.26.  "Ten-Percent Stockholder" means an Eligible Employee or other
eligible Plan participant, who, at the time an Incentive Stock Option is to be
granted to him or her, owns (within the meaning of Section 422(b)(6) of the
Code) stock possessing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company, or of a Parent or a Subsidiary.

     3.  Administration.
         --------------

     3.1.  The Plan shall be administered by the Committee which shall hold
meetings at such times as may be necessary for the proper administration of the
Plan.  The Committee shall keep minutes of its meetings.  A quorum shall consist
of not less than two members of the Committee and a majority of a quorum may
authorize any action.  Any decision or determination reduced to writing and
signed by a majority of all of the members of the

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Committee shall be as fully effective as if made by a majority vote at a meeting
duly called and held.  Each member of the Committee shall be a Disinterested
Director.  No member of the Committee shall be liable for any action, failure to
act, determination or interpretation made in good faith with respect to this
Plan or any transaction hereunder, except for liability arising from his or her
own willful misfeasance, fraud or bad faith.  The Company hereby agrees to
indemnify each member of the Committee for all costs and expenses and, to the
extent permitted by applicable law, any liability incurred in connection with
defending against, responding to, negotiation for the settlement of or otherwise
dealing with any claim, cause of action or dispute of any kind arising in
connection with any action or failure to act in administering this Plan or in
authorizing or denying authorization to any transaction hereunder.

     3.2.  Subject to the express terms and conditions set forth herein, the
Committee shall have the power from time to time to determine those Eligible
Employees to whom Employee Options shall be granted under the Plan and the
number of Incentive Stock Options and/or Nonqualified Stock Options to be
granted to each Eligible Employee and to prescribe the terms and conditions
(which  need not be identical) of each Employee Option, including the purchase
price per Share subject to each Employee Option, and make any amendment or
modification to any Agreement consistent with the terms of the Plan.

     3.3.  Subject to the express terms and conditions set forth herein, the
Committee shall have the power from time to time:

     (a) to construe and interpret the Plan and the Options granted thereunder
and to establish, amend and revoke rules and regulations for the administration
of the Plan, including, but not limited to, correcting any defect or supplying
any omission, or reconciling any inconsistency in the Plan or in any Agreement,
in the manner and to the extent it shall deem necessary or advisable to make the
Plan fully effective, and all decisions and determinations by the Committee in
the exercise of this power shall be final, binding and conclusive upon the
Company, its Subsidiaries, the Optionees and all other persons having any
interest therein;

     (b) to determine the duration and purposes for leaves of absence which may
be granted to an Optionee on an individual basis without constituting a
termination of employment or service for purposes of the Plan;

     (c) to exercise its discretion with respect to the powers and rights
granted to it as set forth in the Plan;

                                       4
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     (d) generally, to exercise such powers and to perform such acts as are
deemed necessary or advisable to promote the best interests of the Company with
respect to the Plan.


     4.  Stock Subject to Plan.
         ---------------------

     4.1.  The maximum number of Shares that may be made the subject of Options
granted under the Plan is 250,000 Shares (or the number and kind of shares of
stock or other securities to which such Shares are adjusted upon a Change in
Capitalization pursuant to Section 9) and the Company shall reserve 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, such number of Shares as
shall be determined by the Board.

     4.2.  Whenever any outstanding Option or portion thereof expires, is
canceled or is otherwise terminated for any reason, the Shares allocable to the
canceled or otherwise terminated Option or portion thereof may again be the
subject of Options granted hereunder.

     5.  Option Grants for Nonemployee Directors.
         ---------------------------------------

     5.1.  Authority of Committee.  Subject to the provisions of the Plan, the
           ----------------------
Committee shall have full and final authority to select those Nonemployee
Directors who will receive Director Options, the terms and conditions of which
shall be set forth in an Agreement.

     5.2.  Purchase Price.  The purchase price or the manner in which the
           --------------
purchase price is to be determined for Shares under each Director Option shall
be determined by the Committee and set forth in the Agreement evidencing the
Option, provided that the purchase price per Share under each Director Option
shall be not less than the Fair Market Value of a Share on the date the Director
Option is granted.

     5.3.  Duration.  Director Options shall be for a term to be designated by
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the Committee and set forth in the Agreement evidencing the Option.

     5.4.  Vesting.   Each Director Option shall, commencing not earlier than
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the date of its grant, become exercisable in such installments (which need not
be equal or may be one installment) and at such times as may be designated by
the Committee and set forth in the Agreement evidencing the Option.  To the
extent not exercised, installments shall accumulate and be exercisable, in whole
or part, at any time after becoming exercisable, to not later than the date the
Director Option expires.  The Committee may accelerate the exercisability of any
Option or portion thereof at any time.

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     6.  Option Grants for Eligible Employees.
         ------------------------------------

     6.1.  Authority of Committee.  Subject to the provisions of the Plan, the
           ----------------------
Committee shall have full and final authority to select those Eligible Employees
who will receive Employee Options, the terms and conditions of which shall be
set forth in an Agreement; provided, however, that no Eligible Employee shall
                           --------  -------
receive an Incentive Stock Option unless he is an employee of the Company, a
Parent or a Subsidiary at the time the Incentive Stock Option is granted.

     6.2.  Purchase Price.  The purchase price or the manner in which the
           --------------
purchase price is to be determined for Shares under each Employee Option shall
be determined by the Committee and set forth in the Agreement evidencing the
Option, provided that the purchase price per Share under each Employee Option
shall be (i) except as provided in clause (ii) of this Section 6.2, not less
than the Fair Market Value of a Share on the date the Employee Option is
granted; and (ii) with respect to any Incentive Stock Option granted to a Ten
Percent Stockholder, not less than 110% of the Fair Market Value of a Share on
the date the Option is granted.

     6.3.  Duration.  Employee Options granted hereunder shall be for such term
           --------
as the Committee shall determine, provided that no Employee Option shall be
exercisable after the expiration of ten (10) years from the date it is granted
(five (5) years in the case of an Incentive Stock Option granted to a Ten-
Percent Stockholder).  The Committee may, subsequent to the granting of any
Employee Option, extend the term thereof but in no event shall the term as so
extended exceed the maximum term provided for in the preceding sentence.

     6.4.  Vesting.  Each Employee Option shall, commencing not earlier then the
           -------
date of its grant, become exercisable in such installments (which need not be
equal or may be in one installment) and at such times as may be designated by
the Committee and set forth in the Agreement evidencing the Option.  To the
extent not otherwise provided by the Committee, Employee Options shall be
exercisable in three (3) equal installments each equal to one-third of the
entire Option granted, the first of which shall become exercisable on the first
anniversary of the date of the grant of the Employee Option, the second
installment of which shall become exercisable on the second anniversary of the
date of grant of the Employee Option, and the final installment of which shall
become exercisable on the third anniversary of the date of grant.  To the extent
not exercised, installments shall accumulate and be exercisable, in whole or
part, at any time after becoming exercisable, to not later than the date the
Employee Option expires.  The Committee may accelerate the exercisability of any
Option or portion thereof at any time.

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     6.5.  Modification or Substitution.  The Committee may, in its discretion,
           ----------------------------
modify outstanding Employee Options or accept the surrender of outstanding
Employee Options (to the extent not exercised) and grant new Options in
substitution for them.  Notwithstanding the foregoing, no modification of an
Employee Option shall adversely alter or impair any rights or obligations under
the Employee Option without the Optionee's consent.

     7.  Option Grants for Consultants.
         -----------------------------

     7.1.  Authority of Committee.  Subject to the provisions of the Plan, the
           ----------------------
Committee shall have full and final authority to select those consultants to the
Company or a Subsidiary who will receive Consultant Options, the terms and
conditions of which shall be set forth in an Agreement.

     7.2.  Purchase Price.  The purchase price or the manner in which the
           --------------
purchase price is to be determined for Shares under each Consultant Option shall
be determined by the Committee and set forth in the Agreement evidencing the
Option, provided that the purchase price per Share under each Consultant Option
shall be not less than the Fair Market Value of a Share on the date the
Consultant Option is granted.

     7.3.  Duration.  Consultant Options granted hereunder shall be for such
           --------
term as the Committee shall determine, provided that no Consultant Option shall
be exercisable after the expiration of ten (10) years from the date it is
granted.  The Committee may, subsequent to the granting of any Consultant
Option, extend the term thereof but in no event shall the term as so extended
exceed the maximum term provided for in the preceding sentence.

     7.4.  Vesting.   Each Consultant Option shall, commencing not earlier then
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the date of its grant, become exercisable in such installments (which need not
be equal or may be in one installment) and at such times as may be designated by
the Committee and set forth in the Agreement evidencing the Option.  To the
extent not otherwise provided by the Committee, Consultant Options shall be
exercisable in three (3) equal installments each equal to one-third of the
entire Option granted, the first of which shall become exercisable on the first
anniversary of the date of grant of the Consultant Options, the second
installment of which shall become exercisable on the second anniversary of the
date of grant, and the final installment of which shall become exercisable on
the third anniversary of the date of grant.  To the extent not exercised,
installments shall accumulate and be exercisable, in whole or part, at any time
after becoming exercisable, to not later than the date the Consultant Option
expires.  The Committee may accelerate the exercisability of any Option or
portion thereof at any time.

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     8.  Terms and Conditions Applicable to All Options
         ----------------------------------------------

     8.1.  Non-transferability.  No Option granted hereunder shall be
           -------------------
transferable by the Optionee to whom granted otherwise than by will or the laws
of descent and distribution, and an Option may be exercised during the lifetime
of such Optionee only by the Optionee or his or her guardian or legal
representative.  The terms of each Option shall be final, binding and conclusive
upon the beneficiaries, executors, administrators, heirs and successors of the
Optionee.

     8.2.  Method of Exercise.  The exercise of an Option shall be made only by
           ------------------
a written notice delivered in person or by mail to the Secretary of the Company
at the Company's principal executive office, specifying the number of Shares to
be purchased and accompanied by payment therefor and otherwise in accordance
with the Agreement pursuant to which the Option was granted.  The purchase price
for any Shares purchased pursuant to the exercise of an Option shall be paid in
full upon such exercise, as determined by the Committee in its discretion, by
any one or a combination of the following:  (i) cash, or (ii) transferring
Shares to the Company upon such terms and conditions as determined by the
Committee.  At the Optionee's request and subject to the consent of the
Committee, Shares to be acquired upon the exercise of a portion of an Employee
Option will be applied automatically to pay the purchase price in connection
with the exercise of additional portions of the Employee Option then being
exercised.  The written notice pursuant to this Section 8.2 may also provide
instructions from the Optionee to the Company that upon receipt of the purchase
price in cash from the Optionee's broker or dealer, designated as such on the
written notice, in payment for any Shares purchased pursuant to the exercise of
an Option, the Company shall issue such Shares directly to the designated broker
or dealer.  Any Shares transferred to the Company as payment of the purchase
price under an Option shall be valued at their Fair Market Value on the day
preceding the date of exercise of such Option.  If requested by the Committee,
the Optionee shall deliver the Agreement evidencing the Option to the Secretary
of the Company who shall endorse thereon a notation of such exercise and return
such Agreement to the Optionee.  No fractional shares (or cash in lieu thereof)
shall be issued upon exercise of an Option and the number of Shares that may be
purchased upon exercise shall be rounded to the nearest number of whole Shares.

     8.3.  Rights of Optionees.  No Optionee shall be deemed for any purpose to
           -------------------
be the owner of any Shares subject to any Option unless and until (i) the Option
shall have been exercised pursuant to the terms thereof, (ii) the Company shall
have issued and delivered the Shares to the Optionee and (iii) the Optionee's
name shall have been entered as a stockholder of record on the books of the
Company.  Thereupon, the Optionee shall have full

                                       8
<PAGE>

voting, dividend and other ownership rights with respect to such Shares.

     8.4.  Termination of Employment.  Unless otherwise provided in the
           -------------------------
Agreement evidencing the Option, an Option (other than an Option granted to a
consultant or a Nonemployee Director) shall terminate upon an Optionee's
termination of employment with the Company and its Subsidiaries as follows:

     (a) in the event the Optionee's employment terminates as a result of
Disability, the Optionee may at any time within three (3) months after such
event exercise the Option or portion thereof that was exercisable on the date of
such termination;

     (b) if an Optionee's employment terminates for Cause, the Option shall
terminate immediately and no rights thereunder may be exercised;

     (c) if an Optionee's employment terminates without Cause, the Optionee may
at any time within one (1) month after such event exercise the Option or portion
thereof that was exercisable on the date of such termination; and

     (d) if an Optionee dies while an employee of the Company or any Subsidiary
or within six (6) months after termination as a result of Disability as
described in clause (a) of this Section 8.4, the Option may be exercised at any
time within six (6) months after the Optionee's death by the person or persons
to whom such rights under the Option shall pass by will or by the laws of
descent and distribution; provided, however, that an Option may be exercised to
                          --------  -------
the extent, and only to the extent, that the Option or portion thereof was
exercisable on the date of death or earlier termination.

     Notwithstanding the foregoing, in no event may any Option be exercised by
anyone after the expiration of the term of the Option.

     8.5.  Termination of Nonemployee Director Options and Consultant Options.
           ------------------------------------------------------------------
Nonemployee Director Options and Consultant Options granted to Nonemployee
Directors and consultants to the Company or a Subsidiary shall terminate under
such circumstances as are provided in the Agreement evidencing the Option, and
if not expressly specified, as of the close of business on the last day of the
term of the Option, but in no event may such an Option be exercised by anyone
after the expiration of the term of the Option.

                                       9
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     9.  Adjustment Upon Changes in Capitalization.
         -----------------------------------------

     9.1.  Subject to Section 10, in the event of a Change in Capitalization,
the Committee shall conclusively determine the appropriate adjustments, if any,
to the maximum number or class of Shares or other stock or securities with
respect to which Options may be granted under the Plan, the number and class of
Shares or other stock or securities which are subject to outstanding Options
granted under the Plan, and the purchase price therefor, if applicable.

     9.2.  Any such adjustment in the Shares or other stock or securities
subject to outstanding Incentive Stock Options (including any adjustments in the
purchase price) shall be made in such manner as not to constitute a modification
as defined by Section 424(h)(3) of the Code and only to the extent otherwise
permitted by Sections 422 and 424 of the Code.

     9.3.  If, by reason of a Change in Capitalization, an Optionee shall be
entitled to exercise an Option with respect to new, additional or different
shares of stock or securities, such new, additional or different shares shall
thereupon be subject to all of the conditions which were applicable to the
Shares subject to the Option, as the case may be, prior to such Change in
Capitalization.

     10.  Effect of Certain Transactions.
          ------------------------------

     In the event of (i) the liquidation or dissolution of the Company or (ii) a
merger or consolidation of the Company (a "Transaction"), the Plan and the
Options issued hereunder shall continue in effect in accordance with their
respective terms and each Optionee shall be entitled to receive in respect of
each Share subject to any outstanding Options, as the case may be, upon exercise
of any Option, the same number and kind of stock, securities, cash, property, or
other consideration that each holder of a Share was entitled to receive in the
Transaction in respect of a Share.  In the event that, after a Transaction,
there occurs any change of a type described in Section 2.4 hereof with respect
to the shares of the surviving or resulting corporation, then adjustments
similar to, and subject to the same conditions as, those in Section 9 hereof
shall be made by the Committee.

     11.  Termination and Amendment of the Program.
          ----------------------------------------

     11.1.  The Plan shall terminate on the day preceding the tenth anniversary
of the date of its adoption by the Board and no Option may be granted
thereafter.  The Board may sooner terminate or amend the Plan at any time and
from time to time; provided, however, that to the extent necessary under Section
                   --------  -------
16(b) of the Exchange Act and the rules and regulations promulgated thereunder
or other applicable law, no amendment shall be effective

                                       10
<PAGE>

unless approved by the stockholders of the Company in accordance with applicable
law and regulations at an annual or special meeting held within twelve (12)
months after the date of adoption of such amendment.

     11.2.  Except as provided in Sections 9 and 10 hereof, rights and
obligations under any Option granted before any amendment or termination of the
Plan shall not be adversely altered or impaired by such amendment or
termination, except with the consent of the Optionee, nor shall any amendment or
termination deprive any Optionee of any Shares which he may have acquired
through or as a result of the Plan.

     12.  Non-Exclusivity of the Plan.  The adoption of the Plan by the Board
          ---------------------------
shall not be construed as amending, modifying or rescinding any previously
approved incentive arrangement or as creating any limitations on the power of
the Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan, and such arrangements may be either applicable generally or only
in specific cases.

     13.  Limitation of Liability.  As illustrative of the limitations of
          -----------------------
liability of the Company, but not intended to be exhaustive thereof, nothing in
the Plan shall be construed to:

     (i) give any person any right to be granted an Option other than at the
sole discretion of the Committee;

     (ii) give any person any rights whatsoever with respect to Shares except as
specifically provided in the Plan;

     (iii) limit in any way the right of the Company to terminate the employment
of any person at any time; or

     (iv) be evidence of any agreement or understanding, expressed or implied,
that the Company will employ any person at any particular rate of compensation
or for any particular period of time.

     14.  Regulations and Other Approvals; Governing Law.
          ----------------------------------------------

     14.1.  This Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of New York.

     14.2.  The obligation of the Company to sell or deliver Shares with respect
to Options granted under the Plan shall be subject to all applicable laws, rules
and regulations, including all applicable federal and state securities laws, and
the obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee.

                                       11
<PAGE>

     14.3.  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
the Plan or any Agreement in a manner consistent therewith.  Any provisions
inconsistent with such Rule shall be inoperative and shall not affect the
validity of the Plan.

     14.4.  The Board may make such changes as may be necessary or appropriate
to comply with the rules and regulations of any government authority, or to
obtain for Eligible Employees granted Incentive Stock Options the tax benefits
under the applicable provisions of the Code and regulations promulgated
thereunder.

     14.5.  Each Option is subject to the requirement that, if at any time the
Committee determines, in its discretion, that the listing, registration or
qualification of Shares issuable pursuant to the Plan is required by any
securities 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 grant of an Option or the issuance of
Shares, no Options shall be granted or payment made or Shares issued, in whole
or in part, unless listing, registration, qualification, consent or approval has
been effected or obtained free of any conditions, or as otherwise determined to
be acceptable to the Committee.

     14.6.  Notwithstanding anything contained in the Plan to the contrary, in
the event that the disposition of Shares acquired pursuant to the Plan is not
covered by a then current registration statement under the Securities Act of
1933, as amended, and is not otherwise exempt from such registration, such
Shares shall be restricted against transfer to the extent required by the
Securities Act of 1933, as amended, and Rule 144 or other regulations
thereunder.  The Committee may require any individual receiving Shares pursuant
to the Plan, as a condition precedent to receipt of such Shares upon exercise of
an Option, to represent and warrant to the Company in writing that the Shares
acquired by such individual are acquired without a view to any distribution
thereof and will not be sold or transferred other than pursuant to an effective
registration thereof under said act or pursuant to a exemption applicable under
the Securities Act of 1933, as amended, or the rules and regulations promulgated
thereunder.  The certificates evidencing any of such Shares shall be
appropriately amended to reflect their status as restricted securities as
aforesaid.

     15.  Miscellaneous.
          -------------

     15.1.  Multiple Agreements.  The terms of each Option may differ from other
            -------------------
Options granted under the Plan at the same time, or at some other time.  The
Committee may also grant

                                       12
<PAGE>

more than one Option to a given Eligible Employee during the term of the Plan,
either in addition to, or in substitution for, one or more Options previously
granted to that Eligible Employee.

     15.2.  Withholding of Taxes.  (a) The Company shall have the right to
            --------------------
deduct from any distribution of cash to any Optionee, an amount equal to the
federal, state and local income taxes and other amounts as may be required by
law to be withheld (the "Withholding Taxes") with respect to any Option.  If an
Optionee is entitled to receive Shares upon exercise of an Option, the Optionee
shall pay the Withholding Taxes to the Company prior to the issuance of such
Shares.  In satisfaction of the Withholding Taxes, the Optionee may make a
written election (the "Tax Election"), which may be accepted or rejected in the
discretion of the Committee, to have withheld a portion of the Shares issuable
to him or her upon exercise of the Option having an aggregate Fair Market Value,
on the date preceding the date of exercise, equal to the Withholding Taxes,
provided that in respect of an Optionee who may be subject to liability under
Section 16(b) of the Exchange Act either (i) (A) the Optionee makes the Tax
Election at least six (6) months after the date the Option was granted, (B) the
Option is exercised during the ten day period beginning on the third business
day and ending on the twelfth business day following the release for publication
of the Company's quarterly or annual statements of earnings (a "Window Period")
and (C) the Tax Election is made during the Window Period in which the Option is
exercised or prior to such Window Period and subsequent to the immediately
preceding Window Period or (ii) (A) the Tax Election is made at least six months
prior to the date the Option is exercised and (B) the Tax election is
irrevocable with respect to the exercise of all Options which are exercised
prior to the expiration of six months following an election to revoke the Tax
Election.  Notwithstanding the foregoing, the Committee may, by the adoption of
rules or otherwise, (i) modify the provisions in the preceding sentence or
impose such other restrictions or limitations on Tax Elections as may be
necessary to ensure that the Tax Elections will be exempt transactions under
Section 16(b) of the Exchange Act, and (ii) permit Tax Elections to be made at
such other times and subject to such other conditions as the Committee
determines will constitute exempt transactions under Section 16(b) of the
Exchange Act.

     (b) If an Optionee makes a disposition, within the meaning of Section
424(c) of the Code and regulations promulgated thereunder, of any Share or
Shares issued to such Optionee pursuant to the exercise of an Incentive Stock
Option within the two-year period commencing on the day after the date of
transfer of such Share or Shares to the Optionee pursuant to such exercise, the
Optionee shall, within ten (10) days of such disposition, notify the Company
thereof, by delivery of written notice to the Company at its principal executive
office, and immediately deliver to the Company the amount of Withholding Taxes.

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<PAGE>

     15.3.  Designation of Beneficiary.  Each Optionee may designate a person or
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persons to receive in the event of his or her death, any Option or any amount
payable pursuant thereto, to which he or she would then be entitled.  Such
designation will be made upon forms supplied by and delivered to the Company and
may be revoked in writing.  If an Optionee fails effectively to designate a
beneficiary, then his or her estate will be deemed to be the beneficiary.

     16.  Effective Date.  The effective date of the Plan shall be the date of
          --------------
its adoption by the Board, subject only to the approval by the affirmative votes
of the holders of a majority of the securities of the Company present, or
represented, and entitled to vote at a meeting of stockholders duly held in
accordance with the applicable laws of the State of Delaware within twelve (12)
months of such adoption.

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