FAB INDUSTRIES, INC.

                          EMPLOYEE STOCK OWNERSHIP PLAN










                           Effective November 25, 1991








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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                TABLE OF CONTENTS

SECTION                                                                PAGE

SECTION       1.    PURPOSE......................................         1

SECTION       2.    DEFINITIONS..................................         2

                    2.1    Account...............................         2
                    2.2    Active Member.........................         2
                    2.3    Affiliated Company....................         2
                    2.4    Allocation Date.......................         2
                    2.5    Allocation Limit......................         2
                    2.6    Annual Additions......................         2
                    2.7    Beneficiary...........................         3
                    2.8    Board.................................         3
                    2.9    Break in Service......................         3
                    2.10   Code..................................         3
                    2.11   Committee.............................         3
                    2.12   Company or Participating Company......         3
                    2.13   Company Contributions.................         4
                    2.14   Compensation..........................         4
                    2.15   Disability or Disabled................         4
                    2.16   Effective Date........................         4
                    2.17   Employee..............................         4
                    2.18   Employment Date.......................         5
                    2.19   ERISA.................................         5
                    2.20   ESOP Loan.............................         5
                    2.21   FAB...................................         5
                    2.22   Financed Stock........................         5
                    2.23   Highly Compensated Employee...........         5
                    2.24   Hour of Service.......................         5
                    2.25   IRS...................................         5
                    2.26   Leased Employee.......................         5
                    2.27   Loan Suspense Account.................         6
                    2.28   Member................................         6
                    2.29   Normal Retirement Age.................         6
                    2.30   Plan..................................         6
                    2.31   Plan Entry Date.......................         6
                    2.32   Plan Year.............................         6
                    2.33   Qualified Plan........................         6
                    2.34   Retire or Retirement..................         6
                    2.35   Service...............................         6
                    2.36   Spouse................................         7
                    2.37   Stock.................................         7
                    2.38   Trust or Trust Fund...................         7
                    2.39   Trust Agreement.......................         7




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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                TABLE OF CONTENTS
                                   (CONTINUED)

SECTION                                                                  PAGE

SECTION  2.
               2.40   Trustee............................................   7
               2.41   Trustee............................................   7
               2.42   Vested Interest....................................   7
               2.43   Year of Service....................................   7

SECTION  3.    MEMBERSHIP................................................   8

               3.1    Eligibility on Effective Date......................   8
               3.2    Eligibility After Effective Date...................   8
               3.3    Automatic Enrollment by Committee..................   8
               3.4    Duration of Membership.............................   8
               3.5    Accounts of Members................................   9
               3.6    Limitation of Interests of Members.................   9

SECTION  4.    CONTRIBUTIONS TO THE PLAN.................................  10

               4.1    Company Contributions..............................  10
               4.2    Release of Financed Stock and Allocation of
                        Financed Stock and Company Contributions to
                        the Accounts of Members..........................  10
               4.3    Return of Mistaken or Conditional Company
                        Contributions....................................  11
               4.4    Forfeitures........................................  12
               4.5    Member Contributions Prohibited....................  12

SECTION  5.    INVESTMENT OF CONTRIBUTIONS...............................  13

               5.1    Investment in Stock................................  13
               5.2    Financed Stock.....................................  13

SECTION  6.    VALUATION AND MAINTENANCE OF MEMBERS'
                 ACCOUNTS................................................  15

               6.1    Valuation of the Trust Fund........................  15
               6.2    Adjustment of Members' Accounts....................  15
               6.3    Administrative Expenses............................  16
               6.4    Taxes..............................................  16
               6.5    Other Expenses.....................................  16
               6.6    Transactions with Disqualified Persons.............  16




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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                TABLE OF CONTENTS
                                   (CONTINUED)

SECTION                                                                PAGE

SECTION 7.    VESTING OF COMPANY CONTRIBUTIONS.......................    17

              7.1    Full Vesting....................................    17
              7.2    Vesting Upon Other Terminations of Service......    17
              7.3    Rules Applicable to Vesting.....................    17

SECTION 8.    WITHDRAWALS FOR DIVERSIFICATION........................    19

              8.1    Withdrawal......................................    19
              8.2    De Minimis Exception............................    19

SECTION 9.    DISTRIBUTIONS UPON TERMINATION OF SERVICE..............    20

              9.1    Distributions Upon a Member's Termination of
                       Service by Reason of Retirement or Disability.    20
              9.2Distributions Upon Other Terminations of Service....    20
              9.3Deferral Election...................................    20
              9.4Distributions Upon Death............................    21
              9.5Minimum Required Distributions......................    21
              9.6Single Sum Stock Distributions......................    21
              9.7Current Dividends Distributions.....................    21
              9.8Rollovers to Other Plans or IRAs....................    22

SECTION 10.   MAXIMUM AMOUNT OF ALLOCATION...........................    23

              10.1   Limitation on Annual Additions                      23
              10.2   Priority of Reduction                               23
              10.3   Other Plans                                         23

SECTION 11.   RIGHTS AND RESTRICTIONS APPLICABLE TO STOCK............    24

              11.1Voting.............................................    24
              11.2Tender Offers......................................    25
              11.3Restrictions on Stock..............................    26
              11.4Cash Dividends.....................................    26
              11.5Reasonable Actions.................................    27
              11.6Right of First Refusal.............................    27
              11.7Put Option.........................................    27
              11.8Special Definition of Member.......................    28





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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                TABLE OF CONTENTS
                                   (CONTINUED)

SECTION                                                                   PAGE

SECTION 12.   DESIGNATION OF BENEFICIARIES..............................    29

              12.1   Selected Beneficiaries.............................    29
              12.2   Spouse as Beneficiary..............................    29

SECTION 13.   TOP-HEAVY LIMITATIONS.....................................    30

              13.1   Definitions........................................    30
              13.2   Top-Heavy Plan Years...............................    30
              13.3   Aggregation with Other Plans.......................    31


SECTION 14.   ADMINISTRATION OF THE PLAN................................    32

              14.1   The Committee......................................    32
              14.2   The Trustee........................................    32
              14.3   Agents.............................................    32
              14.4   Formation of Committee.............................    32
              14.5   Chairman...........................................    33
              14.6   Demands for Money..................................    33
              14.7   Benefit Claims.....................................    33
              14.8   No Personal Liability..............................    34
              14.9   Agent for Service of Process.......................    34

SECTION 15.   WITHDRAWAL OF A PARTICIPATING COMPANY.....................    35

              15.1   Procedures for Withdrawal..........................    35
              15.2   Contributions Upon Withdrawal......................    35
              15.3   Effect of Withdrawal...............................    36
              15.4   Transfer of Plan Assets............................    36
              15.5   Determinations, Approvals and Notifications........    36

SECTION 16.   AMENDMENT OR TERMINATION OF THE PLAN
                AND TRUST...............................................    37

              16.1   Amendment, Suspension or Termination of the Plan...    37
              16.2   Notice.............................................    37
              16.3   Termination of the Plan............................    37





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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                TABLE OF CONTENTS
                                   (CONTINUED)

SECTION                                                                 PAGE

SECTION 7.   GENERAL LIMITATIONS AND PROVISIONS..........................  39

             17.1 Decrease in Value of Trust Assets......................  39
             17.2 Sole Source of Benefits................................  39
             17.3 No Right to Employment.................................  39
             17.4 Incompetency...........................................  39
             17.5 Alienation.............................................  40
             17.6 Avoidance of Escheat...................................  40
             17.7 Filing Information.....................................  40
             17.8 The Trust..............................................  41
             17.9 Communications to Fab and the Committee................  41
             17.10 Communications to Members.............................  41
             17.11 Captions and References...............................  41
             17.12 Governing Law.........................................  41






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                              FAB INDUSTRIES, INC.
                          EMPLOYEE STOCK OWNERSHIP PLAN

                                   SECTION 1.

                                     PURPOSE


The purpose of the Plan is to encourage  employees  to make and  continue  their
careers with the Company by providing  eligible  employees with a convenient way
to obtain a  beneficial  interest in Stock,  all as set forth  herein and in the
Trust Agreement  adopted as a part of the Plan. The Plan and the Trust Agreement
established  hereunder  are  intended  to  qualify  as a  plan  and  trust  that
constitutes  an "employee  stock  ownership  plan" meeting the  requirements  of
Section  4975(e)(7)  of the Code and Section  407(d)(6)  of ERISA,  and a "stock
bonus plan" meeting the requirements for  qualification  under Section 401(a) of
the Code,  and the Trust is intended to be exempt from Federal  income  taxation
under Section  501(a) of the Code.  The Plan is intended to invest  primarily in
securities  qualifying as "employer securities" under Section 409(1) of the Code
and Section 407(d)(1) of ERISA.


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                                   SECTION 2.

                                   DEFINITIONS


2.1           "ACCOUNT"  shall mean the account  established  and  maintained in
              respect of a Member pursuant to Section 3.5.

2.2           "ACTIVE MEMBER" shall mean, with respect to each Allocation  Date,
              a Member who (i) has completed one (1) Year of Service  during the
              corresponding  Plan  Year and  (ii) is in  Service  (except  under
              Section 2.35(ii)) on the Allocation Date.

2.3           "AFFILIATED  COMPANY"  shall mean the Company  and, to the minimum
              extent necessary under the Code, any entity that is required to be
              aggregated  with the Company under Section 414 of the Code (or any
              successor thereto); provided, however, that solely for purposes of
              Section 10, "Affiliated  Company" shall also mean any other entity
              (or any successor  thereto) that is required to be aggregated with
              the Company under Section 415(h) of the Code.

2.4           "ALLOCATION  DATE"  shall  mean (i) the last day of each Plan Year
              occurring  before the date of  termination  specified by Fab under
              Section 16, (ii) the last day of any month or months during a Plan
              Year, as the Committee may from time to time determine,  and (iii)
              solely for purposes of Section 16, such termination date.

2.5           "ALLOCATION LIMIT" shall mean, as of each Allocation Date, that no
              more  than  one-  third  (1/3)  of the  Annual  Additions  (except
              forfeitures)  attributed to Members' Accounts by reason of Section
              4.2(c) are so  attributed  to the  Accounts of Highly  Compensated
              Employees.

2.6           "ANNUAL  ADDITIONS"  shall mean,  without regard to Section 10 for
              each Plan Year, the sum of (i) the Company  Contributions that are
              directly  credited  to a  Member's  Account  for a  Plan  Year  in
              accordance with Section 4.2(c) and (ii) a Member's allocable share
              of the Company  Contributions  applied to the repayment of an ESOP
              Loan  for  such  Plan  Year,   determined   as  if  such   Company
              Contributions  had not been  applied to the  repayment  of an ESOP
              Loan,  but rather had been allocated to the Accounts of Members in
              accordance  with  Section  4.2(c);  provided,  however,  that  any
              Company  Contributions  applied by the Trustee (not later than the
              due date,  including  extensions for filing the Company's  Federal
              income tax return for that Plan Year) to pay  interest  on an ESOP
              Loan, any forfeitures of Financed Stock, and any amounts allocated
              to Member's Accounts under Section 4.2(b) shall not be included as
              Annual Additions.


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2.7           "BENEFICIARY"   shall  mean  the   beneficiary  or   beneficiaries
              designated pursuant to Section 12 to receive  distribution payable
              under Section 9.4, if any, upon the death of a Member.

2.8           "BOARD" shall mean the Board of Directors of Fab.

2.9           "BREAK IN SERVICE"  shall mean,  as determined by the Committee in
              accordance  with ERISA and the Code,  a twelve  (12) month  period
              commencing  on the  later  of the  Effective  Date  or a  Member's
              Employment  Date,  or any Plan Year  commencing  after  such date,
              during  which a Member  fails to complete  five  hundred one (501)
              Hours of Service.  A Member who is absent from  Service due to the
              pregnancy of the Member,  the birth of a child of the Member,  the
              placement of a child with the Member in  connection  with adoption
              of such child by the Member,  or the caring for such child for the
              period  immediately  following  birth or placement  and who is not
              entitled  to be credited  with Hours of Service for such  absence,
              shall be credited,  solely for purposes of determining whether the
              Member has  incurred a Break in Service,  with the number of Hours
              of  Service  for such  absence  that  otherwise  would  have  been
              credited to the Member had he or she been performing duties during
              the absence;  provided,  however, that in no event shall more than
              five hundred one (501) Hours of Service be credited for any single
              continuous  period of absence  described  herein.  If,  during any
              twelve (12) month period described herein,  the Member has not yet
              been credited  with five hundred one (501) Hours of Service,  then
              the Hours of Service  shall be  credited  in such  period;  in any
              other  case,  the Hours of  Service  credited  hereunder  shall be
              credited in the next following twelve (12) month period.

2.10          "CODE"  shall mean the Internal  Revenue  Code of 1986,  as now in
              effect  or as  hereafter  amended,  and  all  applicable  rulings,
              guidelines or regulations  (whether proposed,  temporary or final)
              promulgated  thereunder.   All  citations  to  sections  or  other
              references  thereof are to such  sections or other  references  as
              they may from time to time be amended, renumbered, or superseded.

2.11          "COMMITTEE"  shall mean the committe that  administers the Plan as
              provided for in Section 14.

2.12          "COMPANY OR  "PARTICIPATING  COMPANY" shall mean Fab, or any other
              Affiliated  Company (i) whose  board of  directors  or  equivalent
              governing body shall have adopted the Plan and the Trust Agreement
              by appropriate  action and (ii) whose adoption thereof is approved
              by the Board. Any such  Participating  Company which so adopts the
              Plan shall be deemed  thereby to adopt the Trust  Agreement and to
              appoint Fab and the Committee as its exclusive  agents to exercise
              on its behalf all of the power and authority  conferred hereby, or
              by the Trust  Agreement,  upon the Company or the  Committee.  The
              authority  of Fab and the  Committee  to act as such agents  shall
              continue  until  the  Plan  is  completely  terminated  as to such
              Participating  Company and the relevant  portion of the Trust Fund
              has been distributed by the Trustee as provided in Section 15.3.


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2.13          "COMPANY CONTRIBUTIONS" shall mean contributions by the Company to
              the Trust Fund  pursuant to Section 4 and  forfeitures  treated as
              Company Contributions under Section 4.4.

2.14          "COMPENSATION"  shall mean, for each Plan Year, the "compensation"
              (as defined  under Section  415(c)(3) of the Code and Treas.  Reg.
              Section 1.415-2(d)(10)) paid to an Employee for the performance of
              Service  during such Plan Year,  and,  (i) except for  purposes of
              Sections  10  and  13,  excludes  any  bonus  and  overtime,   and
              twenty-five  percent (25%) of any  Employee's  commission  income,
              but, (ii) except for purposes of Section 10,  includes any amounts
              otherwise  excludable  from such  individual's  gross  income  for
              Federal income tax purposes under Section 125 or Section 402(a)(8)
              of the  Code;  provided,  however,  that  the  maximum  amount  of
              Compensation  taken into  account for an Employee in any Plan Year
              shall not exceed  $200,000,  as such amount is determined,  and is
              adjusted for any  increase in the  cost-of-living,  under  Section
              401(a)(17)  of the  Code.  Notwithstanding  the  above,  effective
              December 1, 1994, Compensation shall not exceed $150,000, adjusted
              at the same time and in the same manner as under Section 415(d) of
              the Code,  but only if and when the  aggregate  of such  potential
              adjustments  totals at least  $10,000  and then only in amounts of
              $10,000,  as in the manner described in Section  401(a)(17) of the
              Code.

              In determining  the  Compensation  of a Member for purposes of the
              dollar  limitation,  the rules of  Section  414(q)(6)  of the Code
              shall apply except that, in applying such rules, the term "family"
              shall  include  only  the  Spouse  of the  Member  and any  lineal
              descendants  of the Member who have not obtained age nineteen (19)
              before  the  close  of  the  Plan  Year.  If as a  result  of  the
              application  of such rules the  adjusted  limitation  is exceeded,
              then  the   limitation   shall  be  prorated  among  the  affected
              individuals in proportion to each such  individual's  Compensation
              as determined prior to the application of this limitation.

2.15          "DISABILITY" OR "DISABLED" shall mean the inability of a Member to
              adequately  perform  Service  for an  Affiliated  Company due to a
              physical or mental impairment which is expected to last at least a
              year.  Disability  shall  be  determined  by  the  Committee  upon
              competent  medical  evidence that such  Disability  existed at the
              time the individual ceased to perform Service; provided,  however,
              that,  upon notice by the Member,  (i) the Committee shall request
              the  Medical  Society of the  County in which the Member  performs
              Service to  designate  a  physician  to examine  the Member and to
              determine  whether  he or she is  Disabled,  (ii) the  physician's
              report  on the  Member's  medical  examination  shall be final and
              binding on all  parties  and (iii)  one-half  (1/2) of all medical
              fees and expenses  arising from the examination  shall be borne by
              the Member.

2.16          "EFFECTIVE DATE" shall mean November 25, 1991.

2.17          "EMPLOYEE"  shall mean any employee of the Company,  as determined
              by the Committee, but excluding any individual who is (i) included
              in  a  unit  of  employees  covered  by  a  negotiated  collective
              bargaining agreement which does not provide for

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              his or her membership in the Plan, (ii) a nonresident alien of the
              United  States or  described  in Section  861(a)(3) of the Code or
              (iii) a Leased Employee.

2.18          "EMPLOYMENT  DATE"  shall mean the first date on which an Employee
              or Leased Employee completes an Hour of Service.

2.19          "ERISA" shall mean the Employee  Retirement Income Security Act of
              1974, as now in effect or as hereafter amended, and all applicable
              rulings, guidelines or regulations (whether proposed, temporary or
              final) promulgated thereunder.  All citations to sections or other
              references  thereof are to such  sections or other  references  as
              they may from time to time be amended, renumbered or superseded.

2.20          "ESOP  LOAN"  shall  mean a loan  or  other  extension  of  credit
              (including any installment  purchase  obligation)  used to finance
              the  acquisition  of Financed  Stock or to repay an existing  ESOP
              Loan, in accordance with Section 5.2, which loan may constitute an
              extension  of credit to the Trust from any person,  including  the
              Company.

2.21          "FAB" shall mean Fab Industries, Inc. (or any successor thereto).

2.22          "FINANCED STOCK" shall mean shares of Stock acquired for the Trust
              Fund with the  proceeds of an ESOP Loan,  as  described in Section
              5.2.

2.23          "HIGHLY COMPENSATED EMPLOYEE" shall mean a Member who is a "highly
              compensated  employee" within the meaning of Section 414(q) of the
              Code.

2.24          "HOUR OF SERVICE"  shall mean,  as  determined by the Committee in
              accordance  with  ERISA and the Code,  each hour  during  which an
              individual  performs Service (or is treated as performing  Service
              under Section 2.35) and, except in the case of layoffs, jury duty,
              or  military  service,  for which the  individual  is  directly or
              indirectly  paid, or entitled to payment by an Affiliated  Company
              (including any back pay,  irrespective  of mitigation of damages);
              provided,  however,  that in no event shall more than five hundred
              one (501) Hours of Service be credited for purposes of Section 2.9
              or Section 2.43 for any continuous  period during which no Service
              is performed.

2.25          "IRS" shall mean the United States Internal Revenue Service.

2.26          "LEASED  EMPLOYEE"  shall mean any person (other than an Employee)
              who pursuant to an agreement between an Affiliated Company and any
              other person (the "leasing  organization")  has performed services
              for the Affiliated Company on a substantially  full-time basis for
              a period of at least one (1) year, and such services are of a type
              historically  performed by Employees in the business  field of the
              Affiliated Company. Contributions or benefits provided to a Leased
              Employee by the leasing  organization  which are  attributable  to
              services  performed for the Affiliated Company shall be treated as
              provided by the Employer.

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2.27          "LOAN  SUSPENSE  ACCOUNT"  shall mean an account  established  and
              maintained to hold shares of Financed  Stock until such shares are
              allocated to an individual  Member's  Account  pursuant to Section
              4.2.

2.28          "MEMBER" shall mean any Employee who is enrolled in the membership
              of the Plan as provided in Section 3.

2.29          "NORMAL  RETIREMENT AGE" shall mean the later of the date a Member
              (i)  attains  age   sixty-five   (65)  or  (ii)  the  fifth  (5th)
              anniversary of the date an Employee first became a Member.

2.30          "PLAN"  shall  mean  this  Fab  Industries,  Inc.  Employee  Stock
              Ownership Plan, as the same may be amended from time to time.

2.31          "PLAN ENTRY DATE" shall mean the June 1st or December  1st that an
              Employee  commences  membership  in the  Plan in  accordance  with
              Section 3; provided,  however,  that, for purposes of Section 3.1,
              the Plan Entry Date shall be the Effective Date.

2.32          "PLAN  YEAR"  shall mean the fiscal  year of Fab,  the twelve (12)
              month  period  commencing  on each  December  1. For  purposes  of
              Section 415 of the Code (as applied  under  Section  10), the Plan
              Year shall also be the "limitation year."

2.33          "QUALIFIED PLAN" shall mean a plan meeting the requirements of (i)
              Section 401(a) of the Code,  the related trust of which  qualifies
              for  tax-exempt  status under Section  501(a) of the Code, or (ii)
              Section 403(a) of the Code.

2.34          "RETIRE"  OR  "RETIREMENT"  shall  mean a  termination  of Service
              (other  than by reason of death or  Disability)  by a Member on or
              after the earlier of (i) his or her Normal  Retirement Age or (ii)
              the date he or she has both  attained age sixty (60) and completed
              ten (10) Years of Service.

2.35          "SERVICE"  shall mean, as determined by the Committee,  employment
              (whether or not as an Employee) with an Affiliated Company. To the
              extent  and  for  the  purposes  determined  by the  Committee  in
              accordance with ERISA and the Code,  Service  includes (i) periods
              of vacation  and  holidays,  (ii)  periods of layoff,  (iii) other
              periods of absence authorized by the employing  Affiliated Company
              for sickness,  temporary disability, jury duty or personal reasons
              and (iv) if and to the extent required by Federal law,  service in
              the Armed  Forces of the United  States.  Service may also include
              any  period of a Member's  prior  employment  by any  organization
              under such terms and  conditions  as the Committee may approve and
              subject to any required IRS approval.

2.36          "SPOUSE" shall mean the person then legally married to a Member.


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2.37          "STOCK" shall mean the Common Stock, par value $0.20 per share, of
              Fab that is listed on the American Stock  Exchange,  or such other
              securities designated by Fab that qualify as "employer securities"
              within  the  meaning  of  Section  409(l) of the Code and  Section
              407(d)(1) of ERISA.

2.38          "TRUST" OR "TRUST FUND" shall mean the trust established by Fab as
              a part of the Plan.

2.39          "TRUST  AGREEMENT"  shall mean the  agreement  between Fab and the
              Trustee that evidences the Trust,  as the same may be amended from
              time to time, or any successor agreement thereto.

2.40          "TRUSTEE"  shall  mean  the  trustee  or  trustees  of  the  Trust
              appointed  by  Fab,  or  any  successor  or  successors,  thereto;
              provided,  however,  that  no  Trustee  may  be  appointed  by Fab
              hereunder that is not a "bank", as defined in Section 202(a)(2) of
              the Investment Advisors Act of 1940, with equity capital in excess
              of $1,000,000.

2.41          "VALUATION  DATE" shall mean (i) the Allocation Date for each Plan
              Year,  and (ii) the last day of any month or months  during a Plan
              Year (A) immediately preceding the date a Member's Vested Interest
              is distributed in accordance with the provisions of Section 9, but
              notwithstanding  any other  provision of the Plan to the contrary,
              solely for purposes of  determining  the number of shares of Stock
              under  Section  9.7(b)  or  the  amount  of  cash  representing  a
              fractional  share  of  Stock  under  Section  9.6,  or  (B) as the
              Committee may otherwise from time to time determine.

2.42          "VESTED  INTEREST"  shall mean the  portion of a Member's  Account
              that has become nonforfeitable pursuant to Section 7.

2.43          "YEAR OF SERVICE"  shall mean,  as  determined by the Committee in
              accordance  with ERISA and the Code,  a twelve  (12) month  period
              during which an individual completes one thousand (1,000) Hours of
              Service commencing on (i) solely for purposes of Section 3, his or
              her  Employment  Date or  (ii)  the  first  day of any  Plan  Year
              commencing  on or after  (or,  for  purposes  of  Section  2.2(i),
              immediately before) his or her Employment Date; provided, however,
              that, if a Member's  Employment  Date  precedes  December 1, 1990,
              then an  Employee's  Years of Service for purposes of  determining
              his or her Vested Interest under Section 7, shall be determined by
              reference to December 1, 1990 (and not his or her Employment Date)
              under  clause  (ii) above.  Years of Service of a Leased  Employee
              shall be counted solely for purposes of Section 3 and Section 7.


                                        7




<PAGE>



                                   SECTION 3.

                                   MEMBERSHIP


3.1           ELIGIBILITY ON EFFECTIVE DATE

              As of  the  Effective  Date,  each  Employee  who is  eligible  to
              participate in either the Fab Lace, Inc.  Employees Profit Sharing
              Plan or the Fab  Industries,  Inc. Money Option Savings Plan shall
              be automatically enrolled as a Member in the Plan.

3.2           ELIGIBILITY AFTER EFFECTIVE DATE

              Each Employee not described in Section 3.1 shall be  automatically
              enrolled  as a  Member  of the  Plan  as of the  Plan  Entry  Date
              coincident with or immediately  following the later of the date on
              which  he or she (i)  completes  one (1)  Year  of  Service,  (ii)
              attains age eighteen (18) or (iii) becomes an Employee.

3.3           AUTOMATIC ENROLLMENT BY COMMITTEE

              The Committee  shall take all necessary or  appropriate  action to
              enroll each Employee  eligible under this Section 3, and, if it is
              determined  that an Employee has for any reason not been  enrolled
              in the  membership of the Plan in  accordance  with Section 3.1 or
              Section 3.2, such Employee shall be retroactively  enrolled on the
              next following  Allocation  Date in accordance with the applicable
              Section.  On such Allocation  Date, the Account of an Employee who
              is  retroactively  enrolled  shall be  adjusted by  crediting  the
              aggregate  amount  of  Annual  Additions,  if any,  which  had not
              otherwise been attributed to an Account  established on his or her
              behalf by reason of Section  4.2(c) on any prior  Allocation  Date
              had he or she been  enrolled  when first  eligible.  No enrollment
              forms shall be required to enroll an Employee;  provided, however,
              that the Committee may, in accordance  with Section 17.7,  require
              an Employee to complete such Beneficiary  designation forms, forms
              to apply for  benefits and such other forms as the  Committee  may
              determine to be necessary or advisable.

3.4           DURATION OF MEMBERSHIP

              The  membership of a Member shall cease upon  distribution  of the
              amount treated as his or her entire Vested  Interest under Section
              9 of the Plan, or, if earlier, his or her death.

3.5           ACCOUNTS OF MEMBERS

              The  Committee  shall  establish  and  maintain  or  cause  to  be
              established  and  maintained  in respect of each Member an Account
              showing his or her  interest  under the Plan and in the Trust Fund
              and all other relevant data pertaining thereto. Each Member shall

                                        8




<PAGE>



              be  furnished  with a written  statement of his or her Account and
              the  value  of his or her  interest  in the  Trust  Fund at  least
              annually and upon any  distribution  to him or her. In maintaining
              or causing to be  maintained  the  Accounts  of Members  under the
              Plan, the Committee may conclusively rely on the valuations of the
              Trust in  accordance  with the  Plan  and the  terms of the  Trust
              Agreement.

3.6           LIMITATION OF INTERESTS OF MEMBERS

              The  establishment  and maintenance of, or allocations and credits
              to,  the  Account  of any  Member  shall  not vest in any  Member,
              Beneficiary,  Spouse or other person, any right, title or interest
              in the Account,  the Trust Fund or to any Plan benefits  except at
              such times and upon such terms and  conditions  as  expressly  set
              forth in the Plan and the Trust Agreement.



                                        9




<PAGE>



                                   SECTION 4.

                            CONTRIBUTIONS TO THE PLAN


4.1           COMPANY CONTRIBUTIONS

              For each Plan  Year,  the  amount  and the  timing of the  Company
              Contributions  to be paid into the Trust Fund shall be  determined
              by  Fab.  Company  Contributions  may  be  either  in  cash,  cash
              equivalents  or Stock,  as determined by Fab;  provided,  however,
              that the amount of Company Contributions made in cash for any Plan
              Year shall be made at such  times and in such  amounts as shall be
              sufficient  to amortize the amount of the  principal  and interest
              due with respect to any ESOP Loan.

4.2           RELEASE OF FINANCED STOCK AND ALLOCATION OF FINANCED STOCK AND
              COMPANY CONTRIBUTIONS TO THE ACCOUNTS OF MEMBERS

              (a)   Financed  Stock  shall  initially  be  credited  to  a  Loan
                    Suspense Account and shall be allocated to Members' Accounts
                    only as payments of principal  and interest on the ESOP Loan
                    are made by the Trustee.  Company Contributions for any Plan
                    Year  shall  first be  applied  to pay any  obligation  with
                    respect to an ESOP Loan that will  mature  during  such Plan
                    Year and then, if Fab so directs the Trustee,  be applied to
                    prepay any other  obligation  with  respect to an ESOP Loan.
                    The number of shares of Financed  Stock to be released  from
                    the Loan  Suspense  Account for  allocation  to the Members'
                    Accounts  for a Plan Year shall be based upon the ratio that
                    the  payments  and  interest  on the ESOP Loan for that Plan
                    Year bears to the total projected  payments of principal and
                    interest over the  remainder of the repayment  period of the
                    ESOP Loan or such other method  permitted under the Code and
                    ERISA,  as  specified  by Fab. If Fab elects for a Plan Year
                    that  some or all of the  cash  dividends  paid on  Financed
                    Stock be applied to the repayment of an ESOP Loan,  then any
                    Financed  Stock  released  from  the Loan  Suspense  Account
                    because of such repayment shall be allocated as if such cash
                    dividends were Company  Contributions  applied in accordance
                    with this Section 4.2(a) for such Plan Year.

              (b)   In the  event  that for any  Plan  Year  (i) Fab  elects  to
                    require  that  some  or all of the  cash  dividends  paid on
                    shares of Stock credited to a Member's Account be applied to
                    the repayment of an ESOP Loan, (ii) an  individual's  return
                    to Service  requires the  recrediting of a forfeiture  under
                    Section  9.2(b),  (iii)  a  notification   received  by  the
                    Committee  requires the  recrediting  of a forfeiture  under
                    Section  17.6,  (iv)  a  retroactive   enrollment   requires
                    crediting an adjustment under Section 3.3, then, the Account
                    of such  affected  Member  shall be credited  with shares of
                    Financed Stock  released from the Loan Suspense  Account for
                    such Plan Year by application of Company Contributions under
                    Section 4.2(a), as of the Allocation Date for such Plan Year
                    (unless Section 9.7(b)(ii) applies), with

                                       10




<PAGE>



                    a value,  determined  as of such  date  that is equal to the
                    amount of cash  dividends so applied or the amount  required
                    to be credited under Section 3.3,  Section 9.2(b) or Section
                    17.6,  as the case may be;  provided,  however,  that in the
                    event such value of the shares of Financed Stock so released
                    is insufficient to make the full allocation required by this
                    Section 4.2(b),  then any  insufficiency  shall be satisfied
                    first with  Company  Contributions  not so applied (if any),
                    and then with Trust Fund earnings, in cash or in Stock, with
                    a value determined as of such date.

              (c)   As of the  Allocation  Date for each Plan Year but after any
                    required  allocation  under  Section  4.2(b),  any remaining
                    shares of Financed  Stock  released  from the Loan  Suspense
                    Account  for  such  Plan  Year  under  Section  4.2(a)  and,
                    separately,  any remaining  amount of Company  Contributions
                    not applied in  accordance  with  Section  4.2(a),  shall be
                    credited to the Accounts of Active Members in the proportion
                    that each such Active  Member's  Compensation  for such Plan
                    Year bears to the aggregate  Compensation of all such Active
                    Members for such Plan Year;  provided,  however,  that,  the
                    Allocation Limit shall not be exceeded for any Plan Year. In
                    the event  that the  Allocation  Limit  would  otherwise  be
                    exceeded,  the amount that would have been  allocated to the
                    Accounts of Highly  Compensated  Employees  shall be reduced
                    pro rata until such  limit is  achieved.  The amount of such
                    reduction  shall then be allocated  among the Active Members
                    who are not Highly Compensated Employees; provided, however,
                    that  the  Compensation  of  Highly  Compensated   Employees
                    -------- ------- shall not be considered in determining such
                    Active Members' pro rata shares of such allocation.

4.3           RETURN OF MISTAKEN OR CONDITIONAL COMPANY CONTRIBUTIONS

              If any  Company  Contributions  are made by mistake  of fact,  the
              excess of the amount  contributed  over the amount that would have
              been contributed had there not occurred a mistake of fact shall be
              returned  within  one (1)  year  after  payment  of  such  Company
              Contributions.  Company Contributions are expressly conditioned on
              their  deductibility  under  Section  404(a)(1) or (3) of the Code
              and,  to the  extent  treated  as  disallowed  as  such,  shall be
              returned within one (1) year after such disallowance. This Plan is
              established  and  maintained on the  condition  that the IRS shall
              issue a favorable determination letter to the effect that the Plan
              and Trust,  and any  amendments  thereto,  meet the  qualification
              requirements   specified   in  Section  1  upon   timely   initial
              application.  If such  approval  should be denied  for any  reason
              (including failure to comply with any conditions for such approval
              imposed by the IRS),  all Company  Contributions  made before such
              denial shall be returned within one (1) year after such denial. In
              the event that Company  Contributions  are returned in  accordance
              with this Section 4.3, a corresponding reduction, as determined by
              the Committee,  shall be made to the Accounts of affected  Members
              and no such affected  Member,  his or her Spouse or Beneficiary or
              any other  person  shall have any rights to all or any  portion of
              the value represented by such reduction. Notwithstanding any other
              provision of the Plan to the  contrary,  no portion of any Company
              Contributions shall

                                       11




<PAGE>



              be  returned to the  Company if such  portion has been  previously
              applied to the payment of principal or interest on an ESOP Loan.

4.4           FORFEITURES

              As of the  Allocation  Date for each Plan  Year,  any  forfeitures
              arising  during  such  Plan Year  under  Section  9.2(b),  Section
              10.2(b) or Section 17.6 shall be treated as Company Contributions;
              provided,  however, that in the event that a portion of a Member's
              Account is forfeited  under the Plan, any Financed Stock allocated
              to his or her Account shall be forfeited last.

4.5           MEMBER CONTRIBUTIONS PROHIBITED

              Members  shall not be permitted or required to make  contributions
              under the Plan.



                                       12




<PAGE>



                                   SECTION 5.

                           INVESTMENT OF CONTRIBUTIONS



5.1           INVESTMENT IN STOCK

              (a)   Except as otherwise  provided in this  Section 5.1,  Company
                    Contributions  (other than  contributions of Stock) received
                    by the Trustee and all other monies,  securities or property
                    held by the  Trustee  under  the  Trust  Agreement  shall be
                    invested with reasonable promptness by the Trustee in shares
                    of Stock,  except as otherwise applied under Section 4.2(a).
                    Dividends  (other  than  those  currently  paid  to  Members
                    pursuant to Section 9.7 or Section  11.4,  or applied to the
                    repayment  of an ESOP Loan under  Section  4.2(a)) and other
                    distributions  received and gains  realized on Stock held in
                    the Trust Fund shall be similarly invested or applied to the
                    acquisition of shares of Stock.

              (b)   If shares  of Stock  are not  available  for  purchase,  the
                    Trustee  shall,  to the  extent  not  inconsistent  with the
                    Plan's   continued   qualification  as  an  "employee  stock
                    ownership plan," within the meaning of Section 4975(e)(7) of
                    the Code and Section 407(d)(6) of ERISA, invest amounts held
                    by the Trust Fund in  securities or  investments  other than
                    Stock.

              (c)   The Trustee may maintain  cash reserves in the Trust Fund to
                    provide  funds for (i)  payment of  expenses or taxes of the
                    Plan and the Trust under  Section 6, (ii)  distributions  in
                    cash or (iii)  repayments  of  principal  and interest on an
                    ESOP Loan.  Such  reserves may be invested in cash,  savings
                    accounts,  certificates  of deposit or other cash equivalent
                    investments  in  accordance  with  the  terms  of the  Trust
                    Agreement.

              (d)   Any  investments  other than Stock may be made  through  the
                    medium of any common,  collective or  commingled  trust fund
                    maintained by the Trustee which is qualified  under Sections
                    401(a)  and 501(a) of the Code,  constituting  a part of the
                    Plan and the Trust.

5.2           FINANCED STOCK

              (a)   On the Effective  Date, the Trustee shall incur an ESOP Loan
                    as directed by Fab to finance the  acquisition  of shares of
                    Financed Stock for the Trust.  Subsequently,  Fab may direct
                    the Trustee to incur additional ESOP Loans from time to time
                    to finance the  acquisition  of shares of Financed Stock for
                    the Trust or to repay a prior ESOP Loan.  The proceeds of an
                    ESOP Loan must be applied within a reasonable period of time
                    after  their  receipt  to be  invested  in  accordance  with
                    Section 5.1, to repay such loan or to repay a prior ESOP

                                       13




<PAGE>



                    Loan.  The terms of any ESOP Loan,  at the time such loan is
                    made,  shall  be at least  as  favorable  to the Plan as the
                    terms  of a  comparable  loan  resulting  from  arm's-length
                    negotiations between independent parties. An ESOP Loan shall
                    be for a  specific  term,  shall bear a  reasonable  rate of
                    interest  and shall not be payable  on demand  except in the
                    event of  default,  in which  event the value of Trust  Fund
                    assets  transferred  to satisfy the default shall not exceed
                    the amount of the default;  provided,  however, that, if the
                    lender is a  "disqualified  person"  (as  defined in Section
                    4975(e)(2) of the Code) or a "party in interest" (as defined
                    in Section  3(14) of ERISA,  a transfer of  collateral  upon
                    default  shall be made  only  upon and to the  extent of the
                    failure  of the Plan to meet the  payment  schedule  for the
                    ESOP Loan.

              (b)   The only Trust Fund assets may be pledged as collateral  for
                    an ESOP Loan are the shares of Financed  Stock  allocated to
                    the Loan Suspense  Account acquired with the proceeds of the
                    ESOP Loan or such shares used as  collateral on a prior ESOP
                    Loan  that was  repaid  with the  current  ESOP  Loan and no
                    lender shall have  recourse  against Trust Fund assets other
                    than (i) such collateral,  (ii) Company  Contributions  that
                    are made  under the Plan to meet the  obligations  under the
                    ESOP Loan with respect to which no allocation  under Section
                    4.2 has been  made and  (iii)  dividends  or other  earnings
                    attributable  to such  collateral and the investment of such
                    Company  Contributions;   provided,  however,  that  amounts
                    described  in clause  (iii)  above not  applied to repay any
                    ESOP Loan in accordance  with Section 4.2(a) for a Plan Year
                    shall be allocated  to Members'  Accounts as earnings on the
                    Trust Fund in accordance  with Section  4.2(b) or Section 6.
                    Any pledge of Financed Stock must provide for the release of
                    shares so  pledged  on a pro rata  basis as the ESOP Loan is
                    repaid by the Trustee  and as such shares of Financed  Stock
                    are  allocated  to Members'  Accounts as provided in Section
                    4.2.

              (c)   Amounts to be used to satisfy the  obligations  arising from
                    any ESOP Loan shall be accounted for separately by the Trust
                    until so used.



                                       14




<PAGE>



                                   SECTION 6.

                 VALUATION AND MAINTENANCE OF MEMBERS' ACCOUNTS


6.1           VALUATION OF THE TRUST FUND

              (a)   As of each  Valuation  Date, the Trust Fund shall be valued,
                    pursuant  to the terms of the Plan and the Trust  Agreement,
                    (i) to reflect first,  any allocation  involving  Trust Fund
                    earnings  under  Section  4.2(b),  (ii)  then the  effect of
                    dividends or other income received and accrued, realized and
                    unrealized  profits  and losses  and all other  transactions
                    during  the  period   beginning  after  the  next  preceding
                    Valuation  Date  (or the  Effective  Date,  if  there  is no
                    preceding  Valuation Date) and ending on such Valuation Date
                    (the  "Valuation  Period"),  but such  valuation  shall  not
                    include  any  Company  Contributions  received  during  such
                    Valuation  Period.  Such  valuation  shall be conclusive and
                    binding  upon all  persons  having an  interest in the Trust
                    Fund.

              (b)   The Committee may appoint an independent  appraiser to value
                    all or any part of the assets of the Trust  Fund;  provided,
                    however,  that all  valuations  of shares of Stock which are
                    "not readily tradable on an established  securities  market"
                    (within  the meaning of Section  401(a)(28)(C)  of the Code)
                    shall   be  made  by  an   independent   appraiser   meeting
                    requirements  analogous to those under Section  170(a)(1) of
                    the  Code.   The  Trustee,   Fab,  and  the   Committee  may
                    conclusively  rely upon the  valuation  prepared by any such
                    independent appraiser.

6.2           ADJUSTMENT OF MEMBERS' ACCOUNTS

              On the basis of such  valuation,  the  Committee  shall adjust the
              Members'  Accounts  as of  each  Valuation  Date  to  reflect  the
              transactions  taken into account  under  Section  6.1(a).  For the
              Valuation  Period,  such adjustments of Members' Accounts shall be
              made by (i)  deducting  from  each said  Account  the total of all
              payments made from the Account during the Valuation  Period,  (ii)
              adding to or deducting from, as the case may be, each Account such
              proportion  of each  adjustment  under  Section  6.1 as the amount
              credited to the Account as of the next  preceding  Valuation  Date
              bears to the total of the  amounts in all of said  Accounts  as of
              such preceding  Valuation Date and (iii) adding, if such Valuation
              Date is also an  Allocation  Date,  to each  Account the  Member's
              allocable  share of any amounts  treated as Company  Contributions
              (other  than such  amounts as are  applied or to be applied to the
              repayment of an ESOP Loan) for such Valuation  Period or shares of
              Financed  Stock  released  from  the  Loan  Suspense  Account  and
              properly  allocated to such Member's Account as of such Allocation
              Date in accordance  with Section 4.2. As of each  Valuation  Date,
              the  amount  attributable  to a  Member's  Account  shall mean the
              number of shares (including  fractional  shares) of Stock plus any
              other property or cash properly  credited to the Member's  Account
              as of such date.

                                       15




<PAGE>




6.3           ADMINISTRATIVE EXPENSES

              The expenses of administering the Plan, including (i) the fees and
              expenses of any employee and of the Trustee for the performance of
              its duties under the Plan or Trust,  (ii) the expenses incurred by
              the members of the Committee or their delegates in the performance
              of their duties under the Plan (including reasonable  compensation
              for any legal counsel,  appraisers,  certified public accountants,
              consultants  and  agents  and the  cost of  services  rendered  in
              respect  of the  Plan) and (iii)  all  other  proper  charges  and
              disbursements  of the  Trustee,  the Company or the members of the
              Committee  (including  settlements  of  claims  or  legal  actions
              approved by Fab) shall be paid out of the Trust Fund and allocated
              to and  deducted  from the Members'  Accounts by the  Committee in
              accordance  with the provisions of Section 6.2, unless the Company
              pays such expenses directly without  reimbursement  from the Trust
              Fund.

6.4           TAXES

              Taxes, if any, of any and all kinds whatsoever which are levied or
              assessed on any assets held or income  received by the Trust Fund,
              shall be allocated to and deducted from the Members' Accounts.

6.5           OTHER EXPENSES

              Brokerage fees,  transfer taxes and any other expenses incident to
              the purchase or sale of Stock by the Trustee shall be deemed to be
              part of the  cost of such  Stock  or  deducted  in  computing  the
              proceeds therefrom, as the case may be.

6.6           TRANSACTIONS WITH DISQUALIFIED PERSONS

              Notwithstanding  any  other  provision  of the  Plan or the  Trust
              Agreement to the  contrary,  if a transaction  involving  Stock is
              between  the Trustee  and a  "disqualified  person" (as defined in
              Section  4975(e)(2)  of the  Code) or a "party  in  interest"  (as
              defined  in Section  3(14) of  ERISA),  the value of the shares of
              Stock  subject to such  transaction  shall be determined as of the
              date of such transaction.



                                       16




<PAGE>



                                   SECTION 7.

                        VESTING OF COMPANY CONTRIBUTIONS



7.1           FULL VESTING

              (a)   Each  Member  who  attains  Normal  Retirement  Age while in
                    Service or who  terminates  Service by reason of Retirement,
                    Disability or death shall have a one hundred  percent (100%)
                    Vested  Interest  in  the  amount  credited  to  his  or her
                    Account.

              (b)   Each Member in Service affected by a complete termination of
                    the Plan under Section 16.3, or a "partial  termination"  of
                    or "permanent  discontinuance  of contributions" to the Plan
                    under  Section  15.1(b),  shall have a one  hundred  percent
                    (100%) Vested Interest in the amount allocated to his or her
                    Account,  as adjusted under the provisions of Section 16 and
                    Section 15.3, respectively.

7.2           VESTING UPON OTHER TERMINATIONS OF SERVICE

              Any Member to which Section 7.1 does not apply shall have a Vested
              Interest,  as determined by the  Committee,  in the portion of the
              amount  credited  to  his  or  her  Account  determined  from  the
              following  vesting  schedule  on the  basis of the  number of full
              Years of Service  which he or she has  completed as of the date of
              his or her termination of Service.


                                VESTING SCHEDULE

              Full Years of Service                                  Percentage

              Less than 1........................................         0%
              1 but less than 2..................................        10%
              2 but less than 3..................................        20%
              3 but less than 4..................................        30%
              4 but less than 5..................................        40%
              5 but less than 6..................................        60%
              6 but less than 7..................................        80%
              7 or more .........................................       100%

7.3           RULES APPLICABLE TO VESTING

              If a Member returns to Service following a Break in Service, then,
              his or her Years of Service  before such return  shall be counted,
              in addition to his or her Years of

                                       17




<PAGE>



              Service  following such return,  in determining  his or her Vested
              Interest in the amounts credited to his or her Account on or after
              his or her return to Service; provided, however, that, if a Member
              who had no Vested  Interest at the time of his or her  termination
              of  Service  returns  to  Service   following  five  (5)  or  more
              consecutive  Breaks in  Service,  such  Member's  Years of Service
              prior to such Breaks in Service shall not be taken into account in
              determining  such Member's Vested Interest in amounts  credited to
              his or her Account on or after his or her return to Service.



                                       18




<PAGE>



                                   SECTION 8.

                         WITHDRAWALS FOR DIVERSIFICATION



8.1           WITHDRAWAL

              Subject to Section  8.2,  during the first Plan Year that a Member
              both  (i) is at  least  age  fifty-five  (55) and (ii) has been an
              Active  Member for at least ten (10) Plan Years after the November
              30th  coincident  with or next preceding the Effective Date, he or
              she may elect to  withdraw,  on  written  notice to the  Committee
              during the ninety (90) day period  following  such Plan Year,  and
              each of the next five (5) Plan Years,  a number of whole shares of
              Stock determined in accordance with the following formula:

                    D    =   P (X + Y) - Y, where

                    D    =   the   number  of  shares  of  Stock  that  may  be
                             withdrawn  under this Section 8.1,  rounded to the
                             nearest whole integer;                             

                    P    =   twenty-five percent (25%) (fifty percent (50%) for
                             the last Plan Year);                              
                              
                    X    =   the  number  of shares  of Stock  credited  to the
                             Member's Account as of the Allocation Date for the
                             Plan Year; and                                     
                              
                              

                    Y    =   the number of shares of Stock previously withdrawn
                             by the Member under this Section 8.1.             

              Any shares of Stock  which a Member so elects to receive  shall be
              distributed  to the Member not later than one hundred eighty (180)
              days following the Allocation  Date for the Plan Year to which the
              election applies.

8.2           DE MINIMIS EXCEPTION

              A Member shall not be entitled to make a withdrawal  under Section
              8.1 if the value of Stock allocated to such Member's Account, when
              added  to the  value  of any  other  "employer  securities"  under
              Section 409(1) of the Code acquired after 1986 and credited to the
              Member's account in any other "employee stock  ownership"  meeting
              the  requirements  of  Section  4975(e)(7)  of the  Code  that  is
              maintained by an Affiliated Company, does not exceed $500, or such
              greater  amount as may be specified by the IRS under the Code. For
              purposes of this Section 8.2, the value of the Stock or such other
              employer  securities shall be determined as of the Allocation Date
              for the  first  Plan  Year with  respect  to which a Member  would
              otherwise be entitled to make a withdrawal under Section 8.1.


                                       19




<PAGE>



                                   SECTION 9.

                    DISTRIBUTIONS UPON TERMINATION OF SERVICE


9.1           DISTRIBUTIONS UPON A MEMBER'S TERMINATION OF SERVICE BY REASON OF
              RETIREMENT OR DISABILITY

              If  a  Member  terminates  Service  by  reason  of  Retirement  or
              Disability, such Member shall be entitled to a distribution of his
              or her Vested Interest and, unless the member elects  otherwise in
              accordance with Section 9.3, such distribution shall be determined
              as of the Allocation  Date  coincident  with or next following the
              date  of  such   termination  of  Service  and  made  as  soon  as
              practicable  thereafter,  but in no event  later than  ninety (90)
              days following such Allocation Date.

9.2           DISTRIBUTIONS UPON OTHER TERMINATIONS OF SERVICE

              (a)   Subject to the following  provisions of this Section 9.2, if
                    a Member terminates Service for a reason other than death or
                    one  specified in Section 9.1, such Member shall be entitled
                    to a distribution  of his or her Vested Interest and, unless
                    the Member elects  otherwise in accordance with Section 9.3,
                    such  distribution  shall be determined as of the Allocation
                    Date  coincident  with or next  following  the  date of such
                    termination  of Service  and made no later than  ninety (90)
                    days following such Allocation Date.

              (b)   Any  excess  of the  amount  credited  to  such  terminating
                    Member's  Account over his or her Vested  Interest  shall be
                    treated as a forfeiture  under Section 4.4 for the Plan Year
                    during  which  such  Member  terminates   Service.   If  the
                    terminated Member returns to Service prior to incurring five
                    (5)  consecutive  Breaks  in  Service,  the  amount  of such
                    forfeiture  shall be  recredited  to such  Member's  Account
                    (along with imputed  earnings,  gains or losses,  if any, on
                    such forfeiture in the event the terminated  Member had made
                    a deferral  election under Section 9.3) as of the Allocation
                    Date  coincident  with  or  next  following  the  terminated
                    Member's return to Service.

9.3           DEFERRAL ELECTION

              If a Member who has not attained Normal Retirement Age is entitled
              to a distribution  under Section 9.1 or Section 9.2, and the value
              of his or her Vested  Interest  equals or exceeds $3,500 as of the
              Allocation  Date  the  distribution  is to be  determined  in such
              Section,   such  Member  may  elect  to  defer   receipt  of  such
              distribution  by  specifying  a later  Allocation  Date  occurring
              before or next  following  his or her Normal  Retirement  Age with
              respect to which the preceding provisions of this Section 9 are to
              be applied,  through  advance notice to the  Committee;  provided,
              however,  that no  distribution  shall  be made  hereunder  if the
              Member returns to Service before such specified Allocation Date.

                                       20




<PAGE>



9.4           DISTRIBUTIONS UPON DEATH

              Notwithstanding the foregoing  provisions of this Section 9 to the
              contrary,  in the  event  of the  death  of a  Member,  his or her
              Beneficiary  shall be entitled to a  distribution  of the Member's
              Vested  Interest,  determined as of the Allocation Date coincident
              with or next  following the date of the Member's death and made no
              later than ninety (90) days following such Allocation Date.

9.5           MINIMUM REQUIRED DISTRIBUTIONS

              Notwithstanding  any other  provision of the Plan to the contrary,
              all distributions  under the Plan shall be made in compliance with
              the minimum  distribution and timing of distribution  requirements
              under  Section  401(a)(9) of the Code.  To the extent  required by
              Section  401(a)(9)  of the Code,  the  distribution  of the Vested
              Interest  of each  Member of the Plan  shall be made no later than
              April 1 of the calendar year  following the calendar year in which
              the Member attains age seventy and one-half (70-1/2).

9.6           SINGLE SUM STOCK DISTRIBUTIONS

              Any benefit payable under this Section 9 shall be distributed in a
              single  sum  from  the  Trust  Fund  in  whole   shares  of  Stock
              (containing  such legends and upon such terms and  conditions  and
              restrictions  as the Committee may direct)  together with any cash
              either  awaiting  investment in Stock or representing a fractional
              share of Stock.

9.7           CURRENT DIVIDENDS DISTRIBUTIONS

              (a)   Unless  Section  11.4  otherwise  applies,  in the  event  a
                    Member's Vested Interest is to be distributed  during a Plan
                    Year in  accordance  with the  foregoing  provisions of this
                    Section 9, then,  the amount of cash  dividends  paid to the
                    Trustee  by Fab during  that same Plan Year with  respect to
                    such  shares  of  Stock  (including  cash  representing  any
                    fractional  share) to be distributed  ("Current  Dividends")
                    shall be treated in the same manner as the  Member's  Vested
                    Interest  solely for  purposes of this  Section 9, except as
                    provided in Section 9.7(b).

              (b)   (i)  Notwithstanding  Section  9.6,  the  amount of  Current
                         Dividends to be  distributed  to a Member under Section
                         9.7(a) shall be distributed in a single cash sum unless
                         Fab  has  made  the   election   described  in  Section
                         4.2(b)(i) with respect to such Current Dividends.      
                         
                         

                   (ii)  In that event,  Section 9.6 shall apply, but the number
                         of shares of Stock to be distributed that represent the
                         amount of Current  Dividends  shall be determined as of
                         the applicable Valuation Date.                  
                         
                         


                                       21




<PAGE>



9.8           ROLLOVERS TO OTHER PLANS OR IRAS

              Effective  with  respect  to any  distributions  made on or  after
              December 1, 1993 and  notwithstanding any provision of the Plan to
              the contrary that would otherwise limit a Member's  election under
              this  Section,  a Member may elect,  at the time and in the manner
              prescribed  by the  Committee,  to have any portion of an Eligible
              Rollover  Distribution paid, in a Direct Rollover,  to an Eligible
              Retirement Plan specified by the Member.

              Definitions:

              (1)   An "ELIGIBLE  ROLLOVER  DISTRIBUTION" is any distribution of
                    all or any  portion  of the  balance  to the  credit  of the
                    Member, except:

                    (a)    any   distribution   that  is  one  of  a  series  of
                           substantially  equal periodic payments (made not less
                           frequently than annually) made over the life (or life
                           expectancy) of the distributee or the joint lives (or
                           joint  life  expectancies)  of  the  Member  and  the
                           Member's  Beneficiary,  or over a period  of ten (10)
                           years or more;

                    (b)    any  distribution to the extent such  distribution is
                           required under Section 401(a)(9) of the Code; and

                    (c)    the   portion  of  any   distribution   that  is  not
                           includable in gross income (determined without regard
                           to the exclusion of net unrealized  appreciation with
                           respect to employer securities).

              (2)   An "ELIGIBLE  RETIREMENT  PLAN" is an individual  retirement
                    account   described  in  Section  408(a)  of  the  Code,  an
                    individual retirement annuity described in Section 408(b) of
                    the Code, an annuity plan described in Section 403(a) of the
                    Code, or a qualified  trust  described in Section  401(a) of
                    the Code that accepts the  distributee's  Eligible  Rollover
                    Distribution.  However,  in the case of an Eligible Rollover
                    Distribution to the surviving Spouse, an Eligible Retirement
                    Plan  is an  individual  retirement  account  or  individual
                    retirement annuity.

              (3)   A "DIRECT ROLLOVER" is a payment by the Plan to the Eligible
                    Retirement Plan specified by the Member.




                                       22




<PAGE>



                                   SECTION 10.

                          MAXIMUM AMOUNT OF ALLOCATION



10.1          LIMITATION ON ANNUAL ADDITIONS

              Notwithstanding  any other  provision of the Plan to the contrary,
              Annual  Additions  attributed  to a Member's  Account for any Plan
              Year may not exceed the lesser of: (i) $30,000,  as such amount is
              adjusted for any applicable  increases in the cost-of-living under
              the  Code  or  (ii)  twenty-five  percent  (25%)  of the  Member's
              Compensation for such Plan Year.

10.2          PRIORITY OF REDUCTION

              (a)   To the maximum extent necessary,  before-tax deferrals under
                    Code Section  402(a)(8) made on behalf of a Member under any
                    Qualified Plan maintained by an Affiliated  Company shall be
                    returned  to the Member  before any Annual  Additions  which
                    would  otherwise be  allocated  to a Member's  Account on an
                    Allocation  Date are  reduced  by  reason of  Section  10.1;
                    provided,  however,  any Annual  Additions  attributable  to
                    shares of Financed Stock shall be last reduced.

              (b)   Any Annual Additions  reduced under Section 10.2(a) shall be
                    allocated on the next  Allocation  Date first, to the extent
                    permissible  under Section  10.1,  to the affected  Member's
                    Account and any  remaining  portion of such amount  shall be
                    treated  as  a  forfeiture  under  Section  4.4;   provided,
                    however,  that the  Compensation of the affected Member from
                    whose  Account  the  forfeiture  arose  shall in no event be
                    considered in determining any Active Member's pro rata share
                    of any allocation under Section 4.2(c).

10.3          OTHER PLANS

              The Committee shall, to the extent required by the Code, apply the
              limitations  contained  in this  Section 10 by taking into account
              the benefits  payable and the  contributions  made under any other
              Qualified  Plan which is maintained by an Affiliated  Company and,
              if such  other  plan is a  defined  benefit  plan,  the sum of the
              defined  benefit plan fraction and the defined  contribution  plan
              fraction (as  described  in Section  415(e) of the Code) shall not
              exceed 1.0.


                                       23




<PAGE>



                                   SECTION 11.

                   RIGHTS AND RESTRICTIONS APPLICABLE TO STOCK



11.1          VOTING

              Notwithstanding  any  other  provision  of the  Plan or the  Trust
              Agreement  to  the  contrary,   all  shares  of  Stock  (including
              fractional  shares)  held in the Trust  Fund shall be voted by the
              Trustee  at the  direction  of  Members  in  accordance  with this
              Section 11.1.

              (a)   Before each  annual or special  meeting of  stockholders  of
                    Fab, the  Committee  shall cause to be promptly sent to each
                    Member  who  has  shares  of  Stock  credited  to his or her
                    Account  (without  regard to whether the Member has a Vested
                    Interest in such Stock), on the record date of such meeting,
                    all materials  that a shareholder of Fab would have received
                    with respect to such meeting, including, but not limited to,
                    notices,  proxies,  financial  statements  and  Fab's  proxy
                    solicitation  materials,  together with a form directing the
                    Trustee on how to vote.  Each Member shall have the right to
                    direct the Trustee  with  respect to the voting of the total
                    number of shares of Stock allocated to his or her Account as
                    of the last  Valuation  Date prior to such annual or special
                    meeting of the shareholders of Fab. In addition, each Member
                    shall  separately  have the right to direct the Trustee with
                    respect to the voting at such annual or special meeting such
                    portion of any other  shares of Stock held in the Trust Fund
                    as is equal to the  product of (i) the total  number of such
                    other shares of Stock held in the Trust Fund,  multiplied by
                    (ii) a fraction,  the numerator of which is the total number
                    of shares of Stock  credited to such Member's  Account as of
                    such  Valuation  Date,  and the  denominator of which is the
                    total  number of shares of Stock held in the Trust Fund that
                    are credited to all Members'  Accounts as of such  Valuation
                    date.

              (b)   In the  event of  Stock  must be  voted  prior to the  first
                    allocation  of  Stock  held  in the  Trust  Fund  to  Active
                    Members'  Account  as of the  first  Allocation  Date,  each
                    individual  who is a Member as of the Plan  Entry  Date next
                    preceding the date of such annual or special  meeting of the
                    shareholders  of Fab,  shall  have the right to  direct  the
                    Trustee with respect to the voting at such annual or special
                    meeting  of an equal  number of the  shares of Stock held in
                    the Trust Fund.


                                       24




<PAGE>



              (c)   All voting directions under this Section 11.1 shall be given
                    to the  Trustee  in  writing  in such form and manner as the
                    Committee   shall  prescribe  and  shall  remain  in  strict
                    confidence of the Trustee.  Upon receipt of such directions,
                    the  Trustee  shall vote the  shares of Stock in  accordance
                    therewith.  Any  shares of Stock  with  respect  to which no
                    Member  direction  is  received  shall  not be  voted by the
                    Trustee.

              (d)   In  the  event  consents,   authorizations   or  other  such
                    solicitations  are made with  respect  to Stock in lieu of a
                    meeting,  then  the  Trustee's  vote or  action  on any such
                    solicitation  with  respect  to Stock held in the Trust Fund
                    shall  be  directed   by  Members  to  the  maximum   extent
                    practicable in a manner that is consistent with this Section
                    11.1.

11.2          TENDER OFFERS

              In the event any transaction which is evidenced by the filing of a
              Statement on Schedule 14D-1 under the  Securities  Exchange Act of
              1934, as amended, with the Securities and Exchange Commission,  or
              in the event of any other similar  transaction (a "Tender Offer"),
              including,   but  not   limited   to,   a   "self-tender",   then,
              notwithstanding  any  other  provision  of the  Plan or the  Trust
              Agreement to the contrary,  all, any part or none of the shares of
              Stock (including  fractional  shares) held in the Trust Fund shall
              be tendered and sold or exchanged pursuant to such Tender Offer by
              the Trustee at the  direction of Members in  accordance  with this
              Section 11.2.

              (a)   Promptly  upon  written  receipt of such Tender  Offer,  the
                    Trustee  shall  notify each Member in writing of such Tender
                    Offer and the principal  terms thereof and shall cause to be
                    delivered to each Member  copies of all  materials  that the
                    Trustee would receive as a shareholder  with respect to such
                    Tender Offer,  including,  but not limited to,  prospectuses
                    and financial statements.

              (b)   Each  Member  shall have the right to direct the  Trustee to
                    tender and sell or exchange,  pursuant to such Tender Offer,
                    all or any part of that  number of shares of Stock  credited
                    to the  Member's  Account  as of the most  recent  Valuation
                    Date.  In  addition,  such  Members  shall have the right to
                    direct the Trustee to tender and sell or exchange,  pursuant
                    to such Tender  Offer,  such  portion of any other shares of
                    Stock held in the Trust  Fund as is equal to the  product of
                    (i) the  total  number of such  shares of Stock  held in the
                    Trust Fund  multiplied by (ii) a fraction,  the numerator of
                    which is the total  number of  shares of Stock  credited  to
                    such Member's  Account as of such  Valuation  Date,  and the
                    denominator  of which is the total number of shares of Stock
                    held in the Trust Fund credited to all Members'  Accounts as
                    of such  Valuation  Date.  In the  event a  Member  fails to
                    submit  instructions  to the  Trustee,  such Member shall be
                    deemed to have  elected not to tender  those shares of Stock
                    to  which  the   instruction   would  have   related.   Such
                    instructions shall be given to the Trustee

                                       25




<PAGE>



                    in such form and manner as the Trustee shall prescribe.  Any
                    such directions shall remain in the strict confidence of the
                    Trustee.

              (c)   Subject to Section 11.2(d),  the Trustee shall tender,  sell
                    or  exchange,  to  the  extent  that  the  Tender  Offer  is
                    accepted, that number of shares of Stock for which valid and
                    timely  directions  to do so  have  been  received  and  not
                    subsequently been revoked by Members prior to the expiration
                    date of the Tender Offer to which such directions relate. In
                    addition,   the  Trustee  shall   withdraw,   prior  to  the
                    withdrawal  date of the Tender Offer,  that number of shares
                    of Stock  for  which  the  Trustee  receives  directions  to
                    withdraw.

              (d)   Except as to shares of Stock  sold or  tendered  under  this
                    Section 11.2,  the Trustee is prohibited  from  tendering or
                    otherwise selling or exchanging, or depositing or forwarding
                    for  sale  or  exchange,  any  shares  of  Stock  held by it
                    pursuant  to the  Plan  and the  Trust  Agreement,  and from
                    making any purchases of shares of Stock pursuant to the Plan
                    and Trust  Agreement,  during  the  pendency  of the  Tender
                    Offer.

11.3          RESTRICTIONS ON STOCK

              Shares of Stock held or  distributed  by the  Trustee  may include
              such legends and  restrictions  on  transferability  as Fab or the
              Committee  may  reasonably  require in order to assure  compliance
              with applicable Federal and state securities laws and the terms of
              this Plan or the Trust Agreement.  To the maximum extent permitted
              by ERISA and the Code,  shares of Stock  shall  also be subject to
              the  provisions  of  any  applicable   stockholders'   or  similar
              agreement.  No shares of Stock held or distributed  under the Plan
              may be  subject  to a put,  call or other  option or  buy-sell  or
              similar arrangement, except as provided in this Section 11 and the
              provision  of Section  11.6,  Section  11.7 and this  Section 11.3
              shall be  non-terminable  and shall  continue to be  applicable to
              shares  of  Stock  upon  termination  of the Plan or upon the Plan
              ceasing  to  meet  any  qualification  requirements  specified  in
              Section 1.

11.4          CASH DIVIDENDS

              Fab,  in  addition  to  having  the  right to elect to apply  cash
              dividends on shares of Stock allocated to any Member's  Account as
              provided  in  Section  4, may elect  that such  dividends  be paid
              currently to any Member  either  directly by Fab or by the Trustee
              not later than  ninety  (90) days  following  the Plan Year during
              which such  dividend  was paid;  provided,  however,  that Fab may
              elect that any such cash  distribution  to Members be paid only on
              shares of Stock in which such Members have a Vested Interest.


                                       26




<PAGE>



11.5          REASONABLE ACTIONS

              The Committee shall take all reasonable  actions to assure that as
              of each  Valuation  Date (or other  such  date)  specified  in the
              foregoing  provisions  of this  Section  11,  the  Trustee  has an
              accurate  list of all  Members  and the  number of shares of Stock
              (including  fractional  shares)  credited to their  Accounts.  for
              purposes of this Section 11, Fab and the Committee agree to render
              any  reasonably  necessary  and  appropriate  assistance  that the
              Trustee   requests  to  assure  a  proper   distribution  of  cash
              dividends,  an accurate and confidential collection and tabulation
              of  directions  and, for purposes of Section 11.2, a timely tender
              by the Trustee in accordance with such directions,  including, but
              not   limited  to,   reasonable   compliance   with   registration
              requirements under applicable Federal and state securities laws.

11.6          RIGHT OF FIRST REFUSAL

              In the event the proviso under Section 6.1(b)  applies,  shares of
              Stock  distributed  under the Plan shall be subject to a "right of
              first  refusal."  The right of first  refusal  shall  provide that
              prior to any subsequent transfer, such Stock must first be offered
              in writing to Fab and then if refused by Fab, to the  Trustee,  at
              the  value  determined  for  purposes  of the Plan  under  Section
              6.1(b);  provided,  however,  that a bona fide written  offer of a
              greater  amount  from an  independent  prospective  buyer shall be
              deemed to  establish  the fair market value of such stock for this
              purpose.  The right of Fab or the  Trustee  to  acquire  the Stock
              under this Section 11.6 shall expire  fourteen (14) days after the
              date Fab receives the offer to exercise the right of first refusal
              on the  same  terms  offered  by a  prospective  buyer.  A  Member
              entitled to a distribution  of Stock may be required to execute an
              appropriate  stock  transfer  agreement  (evidencing  the right of
              first refusal) prior to receiving a certificate for Stock.

11.7          PUT OPTION

              In the event the proviso under Section  6.1(b)  applies,  a Member
              holding shares of Stock  distributed  under the Plan may elect, by
              filing a request with the  Committee  (i) no later than sixty (60)
              days following such distribution,  or if such request is not made,
              (ii) during a period of at least sixty (60) days commencing on the
              first  anniversary  of such  distribution  to have Fab (or, if the
              Committee  so  directs  and the  Trustee  consents,  the  Trustee)
              purchase  any such shares of Stock at the value  determined  under
              Section 11.6. Fab (or, if the Committee so directs and the Trustee
              consents,  the Trustee), in its sole discretion,  may pay for such
              Stock either in a lump sum or in ratable annual  installments over
              a period not exceeding five (5) years,  with interest payable at a
              reasonable rate on any unpaid installment balance as determined by
              Fab (or, if the  installments  are to be paid from the Trust Fund,
              by the Committee, with the Trustee's consent). Notwithstanding the
              foregoing, Fab or the Trustee (if the Committee so directs and the
              Trustee  consents)  may (or shall,  if required  under the Code or
              ERISA) offer to purchase any shares of Stock distributed under the
              Plan from any Member at any other  time,  at the value  determined
              under Section 11.6.

                                       27




<PAGE>




11.8          SPECIAL DEFINITION OF MEMBER

              For purposes of this Section 11, the term "Member" shall include a
              Member,  or, in the event a Member with an Account  had died,  the
              Member's  Beneficiary,  or,  if the  Member is  otherwise  legally
              incapacitated  with  respect  to all or any  portion of his or her
              Account, such other person whom the Committee may deem to have the
              legal capacity to manage the Member's affairs, and for purposes of
              Section  11.6 and  Section  11.7,  the term  "Member"  shall  also
              include any donee who has received Stock as a gift from the Member
              or the  custodian or trustee of an individual  retirement  account
              that  holds  Stock for the  benefit  of the  Member by reason of a
              "rollover"  of  the  Member's  Plan  distribution   under  Section
              402(a)(5) of the Code.



                                       28




<PAGE>



                                   SECTION 12.

                          DESIGNATION OF BENEFICIARIES



12.1          SELECTED BENEFICIARIES

              Each Member may file with the Committee a notarized designation of
              one or more  persons as the  Beneficiary  who shall be entitled to
              receive the amount,  if any,  payable  under  Section 9.4 upon the
              Member's death. Subject to Section 12.2, a Member may from time to
              time revoke or change his or her Beneficiary  designation  without
              the consent of any prior  Beneficiary by filing a new  designation
              with the Committee. The last such designation form received by the
              Committee  shall  be  controlling;   provided,  however,  that  no
              designation,  or change or revocation thereof,  shall be effective
              unless  received by the Committee  prior to the Member's death and
              in no  event  shall  it be  effective  as of a date  prior to such
              receipt.

12.2          SPOUSE AS BENEFICIARY

              Notwithstanding any provision of Section 12.1 to the contrary, any
              Beneficiary  designation  or revocation  or change of  Beneficiary
              designation  made or outstanding  with respect to a Member must be
              made with the notarized consent of the Member's Spouse, if any. If
              no Beneficiary  designation  under this Section 12 is in effect at
              the time of a Member's  death, or if the Beneficiary so designated
              fails  to  survive  such  Member,  the  Beneficiary  shall  be the
              Member's  Spouse,  if any, or if there is no Spouse,  the Member's
              surviving  issue,  per stirpes,  or if there is no such issue, the
              Member's  estate.  If the Committee is in doubt as to the right of
              any person to receive any  benefits,  the Committee may direct the
              Trustee to (i)  retain  such  amount,  without  liability  for any
              interest thereon,  until the rights thereto are determined or (ii)
              pay such amount  into any court of  appropriate  jurisdiction  and
              such payment shall be a complete discharge of the liability of the
              Plan and the Trust Fund therefor.


                                       29




<PAGE>



                                   SECTION 13.

                              TOP-HEAVY LIMITATIONS



13.1          DEFINITIONS

              When used in this Section 13, the  following  terms shall have the
              following meanings:

              (a)   "Account  Balance"  shall mean, for the first Plan Year, the
                    value of the Member's  Account as of the Allocation Date for
                    the Plan Year,  and,  for any other Plan Year,  the value of
                    the Member's  Account as of the Allocation Date for the next
                    preceding Plan Year increased by the aggregate amount of all
                    withdrawals and distributions  made from such Account during
                    the immediately preceding five (5) Plan Years.

              (b)   "Key  Employee"  shall mean, for a Plan Year, any individual
                    who  would be  considered  a "key  employee"  under  Section
                    416(i) of the Code.

              (c)   "Top-Heavy"  shall mean, for a Plan Year, that the aggregate
                    Account Balances of Key Employees exceed sixty percent (60%)
                    (or  ninety  percent  (90%) in the  event the Plan is "Super
                    Top-Heavy")  of  the  aggregate   Account  Balances  of  all
                    Members,  determined,  (i) with  respect  to the first  Plan
                    Year, as of the corresponding  Allocation Date and (ii) with
                    respect to any other Plan Year, as of the Allocation Date of
                    the next  preceding Plan Year,  taking into account,  to the
                    extent either required or permitted by the Code, the accrued
                    benefits under each Qualified Plan of an Affiliated  Company
                    in  which  a  Key  Employee   participates  and  each  other
                    Qualified  Plan  which  enables  the Plan to  qualify  under
                    Section 401(a) of the Code.

13.2          TOP-HEAVY PLAN YEARS

              Notwithstanding  any other  provision of the Plan to the contrary,
              if the  Plan is  TopHeavy  for a Plan  Year,  then  the  following
              provisions  shall  apply,  but only to the extent  required by the
              Code.

              (a)   The Annual  Additions  to the Account of each Active  Member
                    (determined  without regard to Section  2.2(i)) who is not a
                    Key  Employee   shall  be  no  less,   as  a  percentage  of
                    Compensation,  than  the  lesser  of (i)  the  largest  such
                    percentage for a Key Employee or (ii) three percent (3%);



                                       30




<PAGE>



              (b)   For any Member who has  completed an Hour of Service  during
                    any Plan Year in which the Plan is Top  Heavy,  the  vesting
                    schedule in Section  7.2 shall be applied by  assuming  each
                    Member in Service otherwise having a "vesting percentage" of
                    at  least  thirty  percent  (30%)  under  such  schedule  is
                    credited with one (1) additional completed Year of Service;

              (c)   The requirements of Section 10.3 shall be satisfied for such
                    Plan Year by making  appropriate  adjustments to the defined
                    benefit  plan  fraction  and the defined  contribution  plan
                    fraction to reflect the additional  restrictions  imposed by
                    Section   416(h)(1)   of  the  Code.   Notwithstanding   the
                    foregoing,  this Section 13.2(c) shall not apply if the Plan
                    is Super  Top-Heavy  for such Plan  Year and  "four  percent
                    (4%)" is  substituted  for "three  (3)" with  respect to the
                    minimum allocation provided under Section 13.2(a).

13.3          AGGREGATION WITH OTHER PLANS

              If any other  Qualified Plan must be or otherwise is considered in
              determining  whether the  requirements  of Section  13.2(a) or (c)
              have been met, appropriate adjustments in accordance with the Code
              shall be made for the  benefits  or  contributions  provided  each
              Member who is not a Key Employee under each such Qualified Plan.



                                       31




<PAGE>



                                   SECTION 14.

                           ADMINISTRATION OF THE PLAN



14.1          THE COMMITTEE

              The   Committee   shall  have  general   responsibility   for  the
              administration and interpretation of the Plan (including,  but not
              limited to,  complying with reporting and disclosure  requirements
              and establishing and maintaining Plan records).  The Committee has
              the  sole  authority  to make  all  decisions,  determinations  or
              interpretations  the Committee may deem  necessary or advisable in
              connection  with the  matters  under the Plan it has  specific  or
              general  responsibility of and all such decisions,  determinations
              or  interpretations  shall be made in the sole  discretion  of the
              Committee  and  shall be  final,  binding  and  conclusive  on all
              interested persons.

14.2          THE TRUSTEE

              Fab shall have the power to appoint,  remove or change the Trustee
              and the Trustee shall have  responsibility  under the Plan for the
              management  and  control  of the  assets  of the Trust  Fund.  The
              Committee shall periodically review the performance and methods of
              the Trustee.

14.3          AGENTS

              The Committee  shall engage such legal counsel,  certified  public
              accountants  or  other  experts,   who  may  be  employed  by  any
              Affiliated  Company,  and make use of such agents and  clerical or
              other  personnel of any Affiliated  Company as the Committee shall
              require or may deem  advisable  for  purposes  of the Plan and the
              Trust.  The  Committee  may rely upon the  written  option of such
              counsel,  accountants or other experts. The Committee may delegate
              to  any  such  agent  or to  any  subcommittee  or  member  of the
              Committee its authority to perform any act  hereunder,  including,
              without  limitation,  those  matters  involving  the  exercise  of
              discretion;  provided,  however,  that  such  delegation  shall be
              subject to revocation at any time by the Committee.  The Committee
              shall  report  to the  Board,  or to a  committee  of  such  Board
              designated for that purpose, at such times as may be designated by
              the Board or  committee  thereof,  with  regard to the matters for
              which the Committee is responsible under the Plan.

14.4          FORMATION OF COMMITTEE

              The  Committee  shall  consist  of not less than three (3) and not
              more than seven (7) members,  each of whom shall be appointed  by,
              shall remain in office at the will of, and may be removed, with or
              without  cause,  by the  Board.  Any member of the  Committee  may
              resign at any time. No member of the Committee shall be entitled

                                       32




<PAGE>



              to act on or decide  any  matter  relating  solely to  himself  or
              herself  or solely to any of his or her rights or  benefits  under
              the Plan.  The  members of the  Committee  shall not  receive  any
              special compensation for serving in their capacities as members of
              the Committee, but shall be reimbursed for any reasonable expenses
              incurred in connection therewith.  Except as otherwise required by
              ERISA, no bond or other security need be required of the Committee
              or any member thereof in any jurisdiction. Any person may serve on
              the Committee,  and any member of the Committee,  any subcommittee
              or agent to whom the Committee  delegates any  authority,  and any
              other  person  or group of  persons,  may  serve in more  than one
              fiduciary capacity with respect to the Plan.

14.5          CHAIRMAN

              The Committee shall elect or designate its own Chairman, establish
              its own  procedures  and the time and place for its meetings,  and
              provide for the keeping of minutes of all meetings.  A majority of
              the members of the  Committee  shall  constitute  a quorum for the
              transaction of business at a meeting of the Committee.  Any action
              of the  Committee  may be  taken  upon the  affirmative  vote of a
              majority of the members of the  Committee  at a meeting or, at the
              discretion of its Chairman or such other member of the  Committee,
              without a meeting, by mail, telegraph or telephone,  provided that
              all  of the  members  of  the  Committee  are  informed  by  mail,
              telegraph  or telephone of their right to vote on the proposal and
              of the outcome of the vote thereon.

14.6          DEMANDS FOR MONEY

              All demands for money of the Plan shall be signed by an officer or
              officers of Fab, or such other person or persons as the  Committee
              may from time to time designate in writing,  who shall cause to be
              (i) kept full and accurate  accounts of receipts and disbursements
              of the Trust Fund,  (ii)  deposited all funds of the Trust Fund to
              the name and  credit of the  Trustee  or the Trust  Fund,  in such
              depositories  as  may  be  designated  by  the  Committee,   (iii)
              disbursed  the monies and funds of the Trust Fund so authorized by
              the Committee and (iv)  performed such other related duties as may
              be assigned to him or her from time to time by the Committee.

14.7          BENEFIT CLAIMS

              All  claims for  benefits  under the Plan  shall be  submitted  in
              writing to, and within a reasonable period of time decided by, one
              (1) person designated in writing by the Chairman of the Committee.
              Written  notice  of the  decision  on each  such  claim  shall  be
              furnished  reasonably  promptly to the  claimant.  If the claim is
              wholly or partially denied, such written notice shall set forth an
              explanation of the specific  findings and  conclusions,  including
              references  to  specific  provisions  of the  Plan  or  the  Trust
              Agreement,  upon which such denial is based. A claimant may review
              all pertinent  documents and may request a review by the Committee
              of such a decision  denying the claim.  Such a request shall be in
              writing and filed with the Committee within a

                                       33




<PAGE>



              reasonable period of time, as specified by the Committee from time
              to  time,  after  delivery  to such  claimant  of  notice  of said
              decision.  Such  request for review shall  contain all  additional
              information  which the claimant  wishes the Committee to consider.
              The  Committee  may hold any  hearing or conduct  any  independent
              investigation  which it deems necessary or advisable to render its
              decision  and the  decision  on  review  shall  be made as soon as
              possible after the Committee's  receipt of the request for review.
              Written  notice  of the  decision  on  review  shall  be  promptly
              furnished to the claimant and shall include  specific  reasons for
              such decision.  For all purposes under the Plan, such decisions on
              claims  (where no review is  requested)  and  decisions  on review
              (where review is requested) shall be final, binding and conclusive
              on all  interested  persons  as to any  matter  or  interpretation
              relating to the Plan.

14.8          NO PERSONAL LIABILITY

              To the  maximum  extent  permitted  by  ERISA,  no  member  of the
              Committee shall be personally  liable by reason of any contract or
              other instrument  executed by him or her, or on his or her behalf,
              in his or her  capacity as a member of the  Committee  not for any
              mistake  of  judgment  made in good  faith and the  Company  shall
              indemnify  and  hold  harmless,   directly  from  its  own  assets
              (including  the proceeds of any  insurance  policy the premiums of
              which are paid from the Company's own assets),  each member of the
              Committee  and each other  officer,  employee,  or director of the
              Company to whom any duty or power  relating to the  administration
              or  interpretation of the Plan or to the management and control of
              the  assets  of the  Trust  Fund may be  delegated  or  allocated,
              against any cost or expense  (including any sum paid in settlement
              of a claim with the  approval  of Fab)  arising  out of any act or
              omission  to act in  connection  with the Plan or the  Trust  Fund
              unless arising out of such person's own fraud or bad faith.

14.9          AGENT FOR SERVICE OR PROCESS

              The  Chairman of the  Committee  or such other  person as may from
              time to time be  designated  by the  Board  shall be the agent for
              service of process under the Plan.



                                       34




<PAGE>



                                   SECTION 15.

                      WITHDRAWAL OF A PARTICIPATING COMPANY



15.1          PROCEDURES FOR WITHDRAWAL

              (a)   Any   Participating    Company   may   withdraw   from   its
                    participation in the Plan by giving the Board, the Committee
                    and the Trustee  prior notice  specifying a withdrawal  date
                    which  shall be the last day of a month at least  sixty (60)
                    days  subsequent  to the date such notice is received by the
                    Board. The Board may terminate any  Participating  Company's
                    participation  in the  Plan,  as of any  withdrawal  date it
                    specifies,  for any reason,  including,  but not limited to,
                    the  failure of the  Participating  Company  to make  proper
                    Company  Contributions  or to  take  appropriate  action  to
                    assure  compliance  with any other  provision of the Plan or
                    with  any  applicable  legal  requirements.  Notice  of  any
                    withdrawal of a  Participating  Company from the Plan by the
                    Board shall be given to the  Committee,  the Trustee and the
                    withdrawing Participating Company.

              (b)   Notwithstanding  the  foregoing,   (i)  the  transfer  of  a
                    Participating Company or a division,  facility, operation or
                    trade or  business of a  Participating  Company to an entity
                    that  is not  an  Affiliated  Company  or  (ii)  a  "partial
                    termination" or "permanent  discontinuance of contributions"
                    of  the  Plan  under  Section  411(d)(3)  of  the  Code,  as
                    determined  by the IRS,  with respect to a group of Members,
                    shall be treated as a withdrawal of a Participating  Company
                    for  purposes of this Section 15 without  further  action by
                    the Board or any Participating Company.

15.2          CONTRIBUTIONS UPON WITHDRAWAL

              Upon the  withdrawal  of any  Participating  Company,  no  further
              Company  Contributions  or  allocations  under  Section  4.2(c) on
              behalf  of  affected  Members  shall be made for Plan  Years  with
              Allocation  Dates occurring  after the date of withdrawal,  and no
              amount shall thereafter be payable under the Plan to or in respect
              of any affected  Members except as provided in this Section 15. To
              the maximum extent  permitted by ERISA and the Code, any rights of
              Members  who  had  been or are  employed  by  other  Participating
              Companies   shall  be  unaffected  by  such   withdrawal  and  any
              transfers,  distributions  or other  dispositions of the assets of
              the  Plan as  provided  in this  Section  15  shall  constitute  a
              complete  discharge of all liabilities under the Plan with respect
              to such Participating Company's participation in the Plan and with
              respect to any affected Member, Spouse or Beneficiary.



                                       35




<PAGE>



15.3          EFFECT OF WITHDRAWAL

              Upon a  Participating  Company's  withdrawal  from the  Plan,  the
              Committee may direct,  in accordance with ERISA and the Code, that
              the Accounts of affected  Members may continue to be maintained by
              the Plan,  or,  after  payment of or  provision  for  expenses and
              charges and  appropriate  adjustment  of the  Accounts of all such
              Members as described in Section 16.3(e) (as if the withdrawal date
              were the termination date), the value of such Accounts may be paid
              from the Trust Fund in the manner  described in Section 16.3(f) or
              transferred,  subject to Section 15.4(b) to a successor  Qualified
              Plan.

15.4          TRANSFER OF PLAN ASSETS

              (a)   To the maximum  extent  permitted by ERISA and the Code, Fab
                    may direct that (i) this Plan be merged or consolidated with
                    another  Qualified Plan,  (ii) the Accounts,  in whole or in
                    part, of one (1) or more Members be  transferred  to another
                    Qualified  Plan or  (iii)  that  assets  or  liabilities  of
                    another Qualified Plan be transferred to this Plan.

              (b)   Notwithstanding any other provision of the Plan or the Trust
                    Agreement  to the  contrary  and to the extent  required  by
                    ERISA or the Code,  no transfer of any of the Plan's  assets
                    or liabilities to a successor  Qualified Plan or transfer of
                    another  Qualified Plan's assets or liabilities to this Plan
                    (whether by merger or consolidation with such Qualified Plan
                    or  otherwise)  shall be made unless each Member  would,  if
                    either  this Plan or such  Qualified  Plan then  terminated,
                    receive a benefit  immediately  after  such  transfer  which
                    (after  taking  account of any  distribution  or payments to
                    them as part of the same transaction) is equal to or greater
                    than the  benefit  he or she  would  have been  entitled  to
                    receive  immediately  before such  transfer if this Plan had
                    then been  terminated.  The Committee may also condition any
                    such   transfer   upon   prior   receipt   of    appropriate
                    indemnification  from the employer or employers  maintaining
                    such other Qualified Plan.

15.5          DETERMINATION, APPROVALS AND NOTIFICATIONS

              All determinations, approvals and notifications that the Committee
              may deem necessary or  appropriate  with respect to the withdrawal
              of a  Participating  Company or any  transaction  contemplated  by
              Section  15.4  shall  be in form and  substance  and from a source
              satisfactory to the Committee.



                                       36




<PAGE>



                                   SECTION 16.

                 AMENDMENT OR TERMINATION OF THE PLAN AND TRUST



16.1          AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN

              (a)   To the maximum  extent  permitted by ERISA and the Code, Fab
                    reserves the right, as of a date specified by Fab, to amend,
                    suspend or terminate, either prospectively or retroactively,
                    the  Plan,  any  Company  Contributions  thereunder,  or the
                    Trust,  in whole or in part,  and for any reason and without
                    the consent of any Participating  Company,  Member,  Spouse,
                    Beneficiary or other person.  Notwithstanding the foregoing,
                    the Plan and Trust shall automatically be terminated without
                    further  action by Fab in the event  that  there is a Tender
                    Offer (as  defined in Section  11.2) or other  event  (other
                    than  the  repayment  of an  ESOP  Loan)  that  directly  or
                    indirectly results in no shares of Financed Stock being held
                    in the Loan Suspense Account.

              (b)   The Committee may adopt  amendments to the Plan which may be
                    necessary or appropriate  to facilitate the  administration,
                    management or  interpretation of the Plan, or to conform the
                    Plan  thereto,  or to  qualify  and  maintain  the Plan as a
                    Qualified  Plan or to comply with any other  applicable  law
                    (including ERISA); provided,  however, that such amendments,
                    in the estimation of the Committee, do not have any material
                    effect on the  currently  estimated  cost of the  Company of
                    maintaining  the  Plan or are not  inconsistent  with  Fab's
                    personnel or fiscal policies.

              (c)   Each  Participating  Company,  by its  adoption of the Plan,
                    shall be deemed to have  delegated the authority  granted in
                    this Section 16 to Fab and the Committee.

16.2          NOTICE

              Notice of any amendment,  modification,  suspension or termination
              of the Plan, specifying the effective date of such action shall be
              given by Fab or the  Committee  to each other and to the  Trustee,
              and all Participating Companies.

16.3          TERMINATION OF THE PLAN

              (a)   Upon  termination  of the Plan,  no  Company  shall make any
                    further Company  Contributions or allocations  under Section
                    4.2(c) under the Plan Years with Allocation Dates that would
                    otherwise have occurred after the  termination  date,  which
                    shall  be the last  Allocation  Date  for the  Plan,  and no
                    amount shall  thereafter  be payable under the Plan to or in
                    respect of any Member except as provided in this Section 16.
                    To the maximum extent permitted by ERISA and

                                       37




<PAGE>



                    the Code, transfers,  distributions or other dispositions of
                    the assets of the Plan as provided in this  Section 16 shall
                    constitute a complete discharge of all liabilities under the
                    Plan and the  Trust  Fund.  The  Committee  shall  remain in
                    existence and all of the provisions of the Plan which in the
                    opinion of the  Committee are necessary for the execution of
                    the  Plan and the  Trust  Fund  and the  administration  and
                    distribution, transfer or other disposition of the assets of
                    the Trust Fund in  accordance  with this  Section 16.3 shall
                    remain in force.

              (b)   In the event that the Plan is terminated, first, any amounts
                    allocated  to  the  Loan  Suspense  Account,   any  proceeds
                    therefrom  and cash  dividends  on shares of Financed  Stock
                    held in the  Loan  Suspense  Account  shall  be  applied  to
                    satisfy  any   outstanding   ESOP  Loan  obligation  in  its
                    entirety,   and  any  such  amounts   remaining  after  full
                    satisfaction of such obligation shall be treated as earnings
                    on the Trust Fund in accordance with Section 16.3(e).

              (c)   Then,   any  Company   Contributions   (including  any  cash
                    dividends on shares of Financed Stock  allocated to Members'
                    Accounts  that Fab  elects  to so apply in  accordance  with
                    Section  4.2(b)(i))  shall be allocated in  accordance  with
                    Section  4.2  as of  the  last  Allocation  Date;  provided,
                    however,  that, for purposes of the allocation under Section
                    4.2(c), Section 2.2(i) shall not apply.

              (d)   In the event that the Plan is terminated while there are any
                    amounts   held  in  suspense   under   Section   10.2  after
                    application of the foregoing  provisions of this Section 16,
                    such amounts shall be applied to the outstanding  balance of
                    any  ESOP  Loan,  and  any  amounts   remaining  after  full
                    satisfaction of such obligation shall be returned to Fab.

              (e)   Then,  the Trust  Fund and each  Member's  Account  shall be
                    adjusted  to reflect  (i)  payment of or  provision  for all
                    expenses and charges  referred to in Section 6.3 and Section
                    6.4 and (ii) adjustment for earnings,  profits and losses of
                    the  Trust  to  the  last  Allocation  Date  in  the  manner
                    described in Section 6.1.

              (f)   Upon  receipt  by the  Committee  of IRS  approval  of  such
                    termination, Fab shall direct that the full current value of
                    each   Member's   Account  shall  be  paid,  to  the  extent
                    reasonably  possible in accordance with Section 9.6, as soon
                    as practicable thereafter from the Trust to each Member (or,
                    in the  event of the  death  of a  Member,  the  Beneficiary
                    thereof),  unless and to the extent, Fab directs that any or
                    all of the Members'  Accounts,  or any portion  thereof,  be
                    transferred,  subject to  Section  15.4(b),  to a  successor
                    Qualified   Plan.   All   determinations,    approvals   and
                    notifications  referred  to  above  shall  be  in  form  and
                    substance and from a source satisfactory to the Committee.


                                       38




<PAGE>



                                   SECTION 17.

                       GENERAL LIMITATIONS AND PROVISIONS



17.1          DECREASE IN VALUE OF TRUST ASSETS

              Each Member,  Spouse,  Beneficiary  or other person shall bear all
              risks in  connection  with any decrease in the value of the assets
              of the  Trust  Fund and the  Member's  Account,  and  neither  the
              Company nor the Committee nor any member thereof, nor any employee
              or  director  of the  Company,  shall  be  liable  or  responsible
              therefor.

17.2          SOLE SOURCE OF BENEFITS

              The Trust shall be the sole source of benefits under the Plan and,
              except  as  otherwise  required  by  ERISA,  the  Company  and the
              Committee,  assume no responsibility for payment of such benefits,
              and each  Member,  Spouse,  Beneficiary  or other person who shall
              claim the right to any payment under the Plan shall be entitled to
              look only to the Trust  Fund for such  payment  and shall not have
              any right,  claim or demand  therefor  against  the Company or the
              Committee,  or any member thereof,  or any employee or director of
              the Company.

17.3          NO RIGHT TO EMPLOYMENT

              Nothing contained in the Plan shall give any employee the right to
              be retained in the employment of any Affiliated  Company or affect
              the  right of any such  employer  to  dismiss  any  employee.  The
              adoption  and  maintenance  of the Plan  shall  not  constitute  a
              contract  between  any  Affiliated  Company  and any  employee  or
              consideration  for,  or an  inducement  to or  condition  of,  the
              employment of any employee.

17.4          INCOMPETENCY

              If the Committee  shall find that any person to whom any amount is
              payable  under the Plan is  unable to care for his or her  affairs
              because of illness or accident,  or is a minor,  or has died, then
              any payment  due him or her, or his or her estate  (unless a prior
              claim   therefor  has  been  made  by  a  duly   appointed   legal
              representative) may, if the Committee so elects, be paid to his or
              her Spouse,  a child, a 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 Plan and the  Trust
              therefor.



                                       39




<PAGE>



17.5          ALIENATION

              Except  insofar as may  otherwise  be  required  by law, no amount
              payable at any time under the Plan and the Trust  shall be subject
              in any  manner to  alienation  by  anticipation,  sale,  transfer,
              assignment,  bankruptcy, pledge, attachment, charge or encumbrance
              of  any  kind  nor in any  manner  by  subject  to  the  debts  or
              liabilities  of any  person,  and any  attempt to so  alienate  or
              subject any such amount,  whether presently or thereafter payable,
              shall be void. If any person shall, or attempt to, alienate,  sell
              transfer, assign, pledge, attach, charge or otherwise encumber any
              amount payable under the Plan and Trust or any part thereof or if,
              by reason of his or her bankruptcy or other event happening at any
              such time,  such amount  would be made subject to his or her debts
              or  liabilities  or would  otherwise not be enjoyed by him or her,
              then the Committee,  if it so elects,  may direct that such amount
              be  withheld  and that the  same or any  part  thereof  be paid or
              applied to or for the benefit of such  person,  his or her Spouse,
              children or other  dependents,  or any of them, in such manner and
              proportion as the Committee may deem proper.

17.6          AVOIDANCE OF ESCHEAT

              If the Committee cannot ascertain the whereabouts of any person to
              whom a payment is due under the Plan,  and if, after eighteen (18)
              months from the date such payment is due, a notice of such payment
              due is mailed to the last known  address of such person,  as shown
              on the records of the Committee or the Company,  and, within three
              (3) months  after such  mailing,  such person has not made written
              claim therefor,  the Committee,  if it so elects,  may direct that
              such  payment and all  remaining  payments  otherwise  due to such
              person be  cancelled  on the  records  of the Plan and the  amount
              thereof  applied as a  forfeiture  under  Section 4.4 for the Plan
              Year in which the Committee  makes such  direction  and, upon such
              cancellation,  the  Plan  and the  Trust  shall  have  no  further
              liability  therefor  except  that,  in the event such person later
              notifies the Committee of his or her  whereabouts and requests the
              payment or payments due to him or her under the Plan,  the amounts
              so applied  shall be paid to him or her no later than  ninety (90)
              days  following the Allocation  Date  coincident or next following
              the date such  notification  is  received by the  Committee,  in a
              single sum distribution as provided in Section 9.6.

17.7          FILING INFORMATION

              Each  Member  or  other  interested  person  shall  file  with the
              Committee  such  pertinent   information   concerning  himself  or
              herself,  his or her  Spouse  and  his or her  Beneficiary  as the
              Committee may specify, and no Member, Beneficiary, or other person
              shall have any rights or be entitled to any benefit under the Plan
              unless such information is filed by or with respect to him or her.

                                       40




<PAGE>



17.8          THE TRUST

              (a)   The Trust Agreement  constitutes a part of the Plan. Any and
                    all rights or benefits accruing to any person under the Plan
                    shall be subject to the terms of the Trust Agreement.

              (b)   Except as otherwise provided in this Plan, in no event shall
                    any part of the Trust  Fund be used for or  diverted  to any
                    purposes other than for the exclusive benefit of Members and
                    their Beneficiaries under the Plan.

17.9          COMMUNICATIONS TO FAB AND THE COMMITTEE

              All elections,  designations,  requests, notices, instructions and
              other transmittals or communications from a Participating Company,
              a Member,  Beneficiary  or other  person  to Fab or the  Committee
              required or permitted under the Plan shall be in writing,  made in
              accordance  with  such  procedures  as the  Committee  or Fab  may
              establish,  shall be in such  form as is  prescribed  from time to
              time by Fab or the Committee,  shall be mailed by first class mail
              or delivered to such  location as shall be specified by Fab or the
              Committee  and shall be deemed  to have been  given and  delivered
              only upon actual  receipt  thereof by such party,  at the location
              specified thereby.

17.10         COMMUNICATIONS TO MEMBERS

              All  notices,  statements,   reports  and  other  transmittals  or
              communications  from  aEParticipating  Company or the Committee to
              any  Employee,  Member,  Beneficiary  or other person  required or
              permitted  under the Plan shall be in  writing  and deemed to have
              been duly given when  delivered  to, or when mailed by first class
              mail,  postage  prepaid and addressed to, such  Employee,  Member,
              Beneficiary  or other person at his or her address last  appearing
              on the records of the Company or the Committee.

17.11         CAPTIONS AND REFERENCES

              The  captions  preceding  in the  Sections  of the Plan  have been
              inserted solely as a matter of convenience and in no way define or
              limit the scope or intent  of any  provision  of the Plan.  Except
              where indicated to the contrary, all references to Sections are to
              Sections of this Plan.

17.12         GOVERNING LAW

              The Plan  and all  rights  thereunder  shall  be  governed  by and
              construed  in  accordance  with ERISA and the laws of the State of
              New York.


                                       41




<PAGE>



IN WITNESS WHEREOF, this plan has been duly executed by an authorized officer of
the  Company on the  Effective  Date and is hereby  reexecuted  this 21st day of
September 1995, to include amendments mandated by the Unemployment  Compensation
Amendments of 1992 and the Omnibus Budget Reconciliation Act of 1993.

                                  FAB INDUSTRIES, INC.

[SEAL]

                                  By  /s/ Samson Bitensky
                                    -----------------------------------
Attest                                    Samson Bitensky , President


/s/  Kym M. Hayes
-----------------------
     Secretary


                                       42