Incentive Stock Option Agreement





		
	Name of Employee: __________________________	No. of Shares: ________________

Exercise Price:  _____________






	





VALLEY NATIONAL BANCORP 

INCENTIVE STOCK OPTION AGREEMENT 



        
        VALLEY
NATIONAL BANCORP, a New Jersey corporation (the “Company”), this _______ day of ________________ (the “Option Date”)
 hereby grants to __________________________________ (Employee”), an employee of the Company
or a subsidiary thereof, pursuant to the
Company’s 1999 Long-Term Stock Incentive Plan, as amended (the “Plan”), an
option to purchase shares of the Common Stock, no par value, of the Company (“Common
Stock”) in the amount and on the terms and conditions hereinafter set forth. 












     	1.	 	
          Incorporation by Reference of Plan. The provisions of the Plan, a copy of
          which is being furnished herewith to the Employee, are incorporated by reference
          herein and shall govern as to all matters not expressly provided for in this
          Agreement. Capitalized terms not defined herein have the meanings set forth in
          the Plan. In the event of any conflict between the terms of this agreement and
          the Plan, the terms of the Plan shall govern. 


          



     	2.	 	
          Grant of Option. The Company hereby grants to the Employee the option
          (the “Option”) to purchase all or any part of an aggregate of
          ____________ shares of Common Stock (“Shares”) on
          the terms and conditions herein set forth. To the extent possible, the Option is
          intended to be an incentive option within the meaning of Section 422 of the
          Code. 


          



     	3.	 	
          Purchase Price. The purchase price of the shares of Common Stock subject
          to the Option shall be ____________ per share subject to
          adjustment as provided in Section 10 below. 


          



     	4.	 	
          Terms of Option. (a)  Vesting. This Option shall not be
          exercisable until the dates shown below: 


          











	5.	 	Notwithstanding
the foregoing vesting schedule, upon the death, Disability or
                    Retirement (as such terms are defined in the Plan) of the Employee,
all options                     shall become immediately exercisable (as such term is
defined in the Plan).                     “Retirement” means the retirement
from active employment with the                     Company of the Employee but only if
the Employee meets all of the requirements                     contained in clause (i) or
contained in clause (ii) as follows: (i) he has a                     minimum combined
total of years of service with Valley and age equal to eighty                     (80);
he is age sixty-two (62) or older; and he provides six (6) months prior
                    written notice to the Company of the retirement; or (ii) he has a
minimum of                     five (5) years of service; he is age sixty-five or older;
and he provides six                     (6) months prior written notice to the Company of
the retirement. “Years of                     service” shall be defined the
same way as it is under Valley’s pension                     plan’; provided
that for this purpose years of service will mean only                     employment with
the Company, and will not include employment by any company or                     entity
acquired by the Company for the period prior to its acquisition by the
                    Company. An Employee who retires but fails to meet such conditions
shall not be                     deemed to be within the definition of “Retirement” for
any purpose                     under the Plan and this Agreement; provided, however,
after a Change in Control                     transaction (as defined in the Plan), no
prior notice of a Retirement shall be                     required and any Optionee who
meets the conditions of clauses (i) and (ii), but                     is terminated
without Cause, shall be deemed to meet all the conditions for
                    Retirement and shall be deemed to have terminated employment due to
Retirement. 






	6.	 	Final
Termination. Notwithstanding anything to the contrary set forth in
                    Section 6(b) of the Plan, the Option shall no longer be exercisable
ten (10)                     years from the date hereof or such shorter as is prescribed
in the Plan or in                     this Agreement. 






	7.	 	Restrictions.
This Option is subject to all the terms and conditions set                     forth in
the Plan including, but not limited to, the following: 






	a.  		This
Option is not transferable, as provided in Section 6(c) of the Plan;  






	b. 		This
Option may be exercised by the Employee’s spouse or other legal
                    representative for a period of one year after the Employee dies or
becomes                     Disabled, as provided in Section 6(g)(1) of the Plan. The
Company is obligated                     to provide the Employee’s spouse (or if
such spouse does not survive the                     Employee, to the Employee’s
designated beneficiaries under the                     Company’s 401(k) plan or
group term life insurance plan) with written                     notice within six (6)
months following the Employee’s termination of                     employment;  






	c. 		This
Option lapses upon the termination of employment if the termination is by
                    the Company or by a subsidiary for Cause or is by the Employee (other
than due                     to the Employee’s Retirement), as provided in Section
6(g)(2) of the Plan;  






	d. 		This
Option may be exercised for the remaining term of the Option and thereafter
                    shall not be affected by the death or Disability of the Employee if
the                     termination is due to the Optionee’s Retirement (an Employee
who exercises                     his or her Options more than 90 days after the
termination of employment due to                     Retirement shall acknowledge that
the Options so exercised will not be Incentive                     Stock Options), as
provided in Section 6(g)(3) of the Plan;  














	e. 		This
Option lapses 90 days after the termination of the Employee’s           employment
if the termination is for any reason other than Cause, Disability,           death,
Retirement, or termination by the Employee, as provided in Section           6(g)(4) of
the Plan; and  






	f. 		This
Option may be exercised by the designated beneficiaries of the Employee, as
          provided in Section 17(c) of the Plan.  






     	8.	 	
          Exercise. This Option shall be exercised by notice to the Company,
          accompanied by full payment in cash or check (or Shares), as set forth in
          Section 6(e) of the Plan. A sample form to be used in exercising this Option is
          attached. 


          



     	9.	 	
          Holding Period of Shares Necessary for Favorable Tax Treatment. To obtain
          favorable tax treatment for stock acquired pursuant to this Option, the Employee
          may not dispose of Shares acquired pursuant to this option (i) within 2 years of
          the date this option is granted or (ii) within 1 year after such shares are
          transferred to the Employee. The foregoing statement of tax consequences is
          intended only as a generalized statement of current Federal tax law (as in
          existence on the date of this Agreement) and the Employee, at its expense,
          should consult his or her tax consultant to determine the specific tax
          consequences of his or her exercise of this Option. An employee who disposes of
          his Shares prior to the expiration of such holding period shall notify the
          Company, within 10 days after the disposition occurs, of the date of the sale
          and the amount of gain on the sale (to permit the Company to deduct the gain for
          tax purposes) and shall deliver to the Company any Federal income tax
          withholding and any other withholding required by law in connection therewith. 


          



     	10.	 	
          Securities Law Restrictions. The Company is under no obligation to file a
          registration statement under the Securities Act of 1933 with respect to the
          Shares to be received upon exercise of the Option. As provided by Section 16(e)
          of the Plan, unless a registration statement under the Act has been filed and
          remains effective with respect to the Shares, the Company shall require that the
          offer and sale of such Shares be exempt from the registration provisions of the
          Act. As a condition of such exemption, the Company shall require a
          representation and undertaking, in form and substance satisfactory to counsel
          for the Company, that the optionee is acquiring the Shares for his own account
          for investment and not with a view to the distribution or resale thereof and
          shall otherwise require such representations and impose such conditions as shall
          establish to the Company’s satisfaction that the offer and sale of the
          Shares issuable upon the exercise of the Option will not constitute a violation
          of the Act or any similar state act affecting the offer and sale. If the shares
          are issued in an exempt transaction, the Shares shall bear the following
          restrictive legend: 


          



	  	
“These
shares have not been registered under the Securities Act of 1933. No transfer of the
shares may be effected without an opinion of counsel to the Company stating that the
transfer is exempt from registration under the Act and any applicable state securities
laws or that the transfer of the shares is covered by an effective registration statement
with respect to the shares.” 














     	11.	 	
          Restrictions on Transfer. This Option shall not be transferred, assigned,
          pledged or hypothecated and shall not be subject to execution, attachment or
          similar process. In the event the terms of this paragraph are not complied with
          by the Employee, or if the Option is subject to execution, attachment or similar
          process, this Option shall immediately become null and void. 


          



     	12.	 	
          Anti-Dilution Provisions. If prior to expiration of the Option there
          shall occur any change in the outstanding Common Stock of the Company by reason
          of any stock dividend, stock split, combination or exchange of shares, merger,
          consolidation, recapitalization, reorganization, liquidation, subscription
          rights offering, or the like, and as often as the same shall occur, then the
          kind and number of shares subject to the Option, or the purchase price per share
          of Common Stock, or both, shall be adjusted by the Compensation Committee in
          such manner as it may deem equitable, the determination of which shall be
          binding and conclusive. Failure of the Compensation Committee or Board to
          provide for any such adjustment shall be conclusive evidence that no adjustment
          is required. The Company shall have the right to engage a firm of independent
          certified public accountants, which may be the Company’s regular auditors,
          to make any computation provided for in this Section, and a certificate of that
          firm showing the required adjustment shall be conclusive and binding. 


          



     	13.	 	
          Acceptance of Provisions. The execution of this Agreement by the Employee
          shall constitute the Employee’s acceptance of and agreement to all of the
          terms and conditions of the Plan and this Agreement. 


          



     	14.	 	
          Notices. All notices and other communications required or permitted under
          the Plan and this Agreement shall be in writing and shall be given either by (i)
          personal delivery or regular mail, in each case against receipt, or (ii) first
          class registered or certified mail, return receipt requested. Any such
          communication shall be deemed to have been given (i) on the date of receipt in
          the cases referred to in clause (i) of the preceding sentence and (ii) on the
          second day after the date of mailing in the cases referred to in clause (ii) of
          the preceding sentence. All such communications to the Company shall be
          addressed to it, to the attention of its Secretary or Treasurer, at its then
          principal office and to the Employee at his last address appearing on the
          records of the Company or, in each case, to such other person or address as may
          be designated by like notice hereunder. 


          



     	15.	 	
          Miscellaneous. This Agreement and the Plan contain a complete statement
          of all the arrangements between the parties with respect to their subject
          matter, and this Agreement cannot be changed except by a writing executed by
          both parties. This Agreement shall be governed by and construed in accordance
          with the laws of the State of New Jersey applicable to agreements made and to be
          performed exclusively in New Jersey. The headings in this Agreement are solely
          for convenience of reference and shall not affect its meaning or interpretation. 


          









	VALLEY NATIONAL BANCORP



By:  
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By:  
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Signature of Employee












	






FORM FOR EXERCISING
INCENTIVE STOCK OPTION 



Date: _________________,
_____ 



Valley National Bancorp

1455 Valley Road

Wayne, New Jersey 07474

Attn.: Dianne M. Grenz 



     Ms. Grenz: 
I am (check one) 



o an employee of Valley National
Bancorp and/or its subsidiaries (the “Company”) 



o a former employee of the
Company 



o the designated beneficiary of
an employee of the Company



and, as such, I am entitled to
exercise the option (the “Option”) granted pursuant to the attached Valley
National Bancorp Incentive Stock Option Agreement (the “Agreement”). 



I wish to exercise the Option to
acquire _____ shares of the Company’s Common Stock (“Shares”) at the
exercise price of ________, as set forth in the Agreement. My total payment of $
___________ or ___________shares is enclosed. 



(Check one to indicate whether you
are paying in:) 



o Cash

o Check made payable to
Valley National Bancorp 

o Other shares of the Company’s Common Stock (only with permission of the Company)



If the Shares I acquire hereby
have not been registered for sale under the Securities Act of 1933, as amended (which the
Company is under no obligation to do), I represent to you that I am acquiring the Shares
for investment purposes only and not with a view to distribution and I authorize you to
place an appropriate restrictive legend on the certificates representing the Shares. 



I understand and recognize that to
obtain favorable tax treatment for the Shares, I must not dispose of the Shares (i) within
two years of the date the Option was granted or (ii) within one year after the date I
acquire the Shares hereunder. If I dispose of Shares prior to the expiration of any such
holding period, I will notify the Company, within 10 days after the disposition occurs, of
the date of sale and the amount of gain on the sale (to permit the Company to deduct the
gain for tax purposes) and I will deliver to the Company any Federal income tax
withholding required by law in connection therewith. 



















	




Please make a notation on the
Agreement to evidence my exercise of the Option as set forth and return the Agreement (if
any Options remain thereunder), along with a certificate representing the shares, to me at
the address below. 













	

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SIGNATURE


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[PRINT NAME]


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