Document:

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                                                                   EXHIBIT 4.2

                              MSS-DELAWARE, INC.

                           STOCKHOLDERS' AGREEMENT

                                 DATED AS OF

                                AUGUST 3, 1998

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                              TABLE OF CONTENTS

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SECTION 1.     DEFINITIONS...................................................................1

SECTION 2.     TRANSFER OF SECURITIES........................................................4
        2.1.   General Prohibition on Transfer...............................................4
        2.2.   Right of First Offer..........................................................4
        2.3.   Tag-Along Right...............................................................6
        2.4.   Exempt Transfer...............................................................8
        2.5.   Related Party.................................................................8
        2.6.   Company Sale..................................................................9
        2.7.   Other Restrictions on Transfer...............................................10
        2.8.   Certain Legal Requirements...................................................10

SECTION 3.     PREEMPTIVE RIGHT.............................................................11

SECTION 4.     REGISTRATION RIGHT...........................................................12
        4.1.   Piggyback Registration Rights................................................12
        4.2.   Demand Registration Rights...................................................14
        4.3.   Registration Procedures......................................................16
        4.4.   Restrictions on Public Sale..................................................20
        4.5.   Registration Expenses........................................................21
        4.6.   Indemnification..............................................................22
        4.7.   Rule 144.....................................................................24
        4.8.   Participation in Underwritten Registrations..................................24
        4.9.   Other Registration Rights....................................................25
        4.10.  Definition of Registrable Securities.........................................25

SECTION 5.     GOVERNANCE...................................................................25
        5.1.   Initial Board................................................................25
        5.2.   Size and Composition of Board................................................25
        5.3.   Removal, Replacement.........................................................27
        5.4.   Insurance....................................................................27
        5.5.   Board Approvals..............................................................27
        5.6.   Certain Approvals............................................................28
        5.7.   Board Meetings...............................................................29
        5.8.   Amended and Restated Certificate of Incorporation and By-Laws................29

SECTION 6.     TERMINATION AND AMENDMENT....................................................30

SECTION 7.     MISCELLANEOUS................................................................30
        7.1.   Legend.......................................................................30
        7.2.   Successors, Assigns and Transferees..........................................31
        7.3.   Specific Performance, Etc....................................................31
        7.4.   Governing Law................................................................31
        7.5.   Interpretation...............................................................31
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        7.6.   Notices......................................................................31
        7.7.   Inspection and Compliance with Law...........................................33
        7.8.   Amendments and Waivers.......................................................33
        7.9.   Transfers Void...............................................................34
        7.10.  Counterparts.................................................................34
        7.11.  Attorneys' Fees..............................................................34
        7.12.  Severability.................................................................34
        7.13.  Federated....................................................................34
        7.14.  Redesignation of Voting Common Stock.........................................34
        7.15.  DeBartolo....................................................................34
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                           STOCKHOLDERS' AGREEMENT

        This STOCKHOLDERS' AGREEMENT ("Agreement") is entered into as of
August 3, 1998 by and among (i) MSS-DELAWARE, INC., a Delaware corporation
(the "Company"), (ii) MSS ACQUISITION CORP. II, a Delaware corporation ("Bear
Stearns"), (iii) FEDERATED SPECIALTY STORES, INC., a Delaware corporation
("Federated"), and (iv) Julian R. Geiger, David R. Geltzer and John S. Mills
(collectively, the "Management").

                                  RECITALS:

        A.     Federated has agreed to acquire 6,000 shares of Series A
Preferred Stock pursuant to that certain Acquisition Agreement dated as of
July 22, 1998 (the "Purchase Agreement") by and between Federated and the
Company and has been granted an option to purchase 4,333 shares of Common
Stock of the Company from Bear Stearns pursuant to the Federated Option
Agreement.

        B.     Bear Stearns has agreed to purchase 65,000 shares of Common
Stock and 6,250 shares of the Series B Preferred Stock and the Management,
collectively, has agreed to purchase 17,500 shares of Common Stock, in each
case from the Company pursuant to that certain Stock Purchase Agreement dated
as of August 3, 1998 (the "Stock Purchase Agreement") by and among Bear
Stearns, the Management and the Company.

        C.     It is a condition precedent to the obligations of: (i) Bear
Stearns and the Management under the Stock Purchase Agreement, and (ii)
Federated under the Purchase Agreement that the parties hereto enter into this
Agreement.

        D.     All of the Stockholders desire to enter into this Agreement for
the purpose of regulating certain aspects of the Stockholders' relationships
with regard to each other and the Company.

                                  AGREEMENT:

        NOW THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the Company and
Stockholders agree as follows:

SECTION 1.     Definitions. As used herein, the following terms shall have the
following meanings:

        "Bear Stearns Parties" means at any time, collectively, Bear Stearns
and its Related Parties who then own voting Common Stock.

        "Bear Stearns Shares" means the voting Common Stock held at any time
by the Bear Stearns Stockholders.

        "Bear Stearns Stockholder" means each of Bear Stearns and any
subsequent holder of Shares (other than the Company) who acquires the same
directly or indirectly from a Bear Stearns Stockholder other than in a
transaction set forth in clauses (iii), (v), (vii) or (viii) of the definition
of Exempt Transfers (as provided in Section 2.4).

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        "Common Stock" means the Common Stock, par value $.01 per share, of
the Company and any other capital stock of the Company into which such Common
Stock is reclassified or reconstituted including, unless otherwise stated, any
non-voting Common Stock of the Company.

        "Company Sale" means a transaction, whether in a single transaction or
in a series of related transactions pursuant to which a person or group of
persons independent of, and which is not an Affiliate of Bear Stearns (a)
acquires, whether by merger, stock purchase, recapitalization, reorganization,
redemption, issuance of capital stock or otherwise, more than 50% of the other
outstanding Common Stock and, following consummation of the transaction, Bear
Stearns owns less than half of the outstanding Common Stock acquired by it on
the date hereof or (b) acquires assets (whether by purchase, lease or
otherwise) constituting all or substantially all of the assets of the Company
and its Subsidiaries.

        "DeBartolo"' means Simon De Bartolo Group, Inc. and any Affiliate of
Simon DeBartolo Group, Inc.

        "Exempt Transfer" see Section 2.4.

        "Federated Option" means the option to purchase 4,333 shares of Common
Stock of the Company granted to Federated by Bear Stearns pursuant to the
Federated Option Agreement.

        "Federated Option Agreement" means that certain Option Agreement by
and between Federated and Bear Stearns.

        "Federated Shares" means the voting Common Stock held at any time by
the Federated Stockholders.

        "Federated Stockholder" means each of Federated and any subsequent
holder of Shares (other than the Company) who acquires the same directly or
indirectly from an Federated Stockholder other than in a transaction set forth
in clauses (iii) or (v) of the definition of Exempt Transfers (as provided in
Section 2.4).

        "Management Parties" means at any time, the Management who are then
employed by the Company or its Subsidiaries who then own voting Common Stock
and their Related Parties who then own voting Common Stock. For the purposes
of this definition and Section 5.2, voting Common Stock held by a voting trust
for Management shall not be included in the determination of the number of
shares of voting Common Stock owned by any Management Party unless the member
of Management whose voting Common Stock is held in trust is then employed by
the Company or its Subsidiaries.

        "Management Shares" means the voting Common Stock held at any time by
the Management Stockholders.

        "Management Stockholder" means each of Management and any subsequent
holder of Shares (other than the Company) who acquires the same directly or
indirectly from a Management Stockholder other than in a transaction set forth
in clauses (iii) or (v) of the definition of Exempt Transfers (as provided in
Section 2.4).

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        "On a Fully Diluted Basis" with respect to the Company's Common Stock
means the number of shares of Common Stock which will be issued and
outstanding after giving effect to the transactions contemplated by the Stock
Purchase Agreement plus the number of shares of Common Stock issuable pursuant
to the Stock Option Plan as of the applicable date of determination.

        "Qualified Public Offering" see Section 3.1.

        "Related Party" see Section 2.5.

        "Series A Preferred Stock" means the 6% Series A Exchangeable
Redeemable Preferred Stock, par value $.01 per share, of the Company and any
other capital stock of the Company into which such Series A Preferred Stock is
reclassified or reconstituted.

        "Series B Preferred Stock" means the 12 1/2% Series B Redeemable
Preferred Stock, par value $.01 per share, of the Company and any other
capital stock of the Company into which such Series B Preferred Stock is
reclassified or reconstituted.

        "Shares" means (i) any shares of the capital stock of the Company
other than the Series A Preferred Stock and the Series B Preferred Stock and
(ii) any securities convertible into, and any rights, options or wan-ants
exchangeable or exercisable for, any of the shares of the capital stock of the
Company, in either case, at any time outstanding including, without
limitation, the Federated Option.

        "Securities Act" means the Securities Act of 1933, as amended from
time to time, and the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.

        "Stock Adjustment" see Section 2.6.1.

        "Stockholders" means the Persons identified on the signature page
hereto as "Stockholders" including, without limitation, Federated and such
other persons who become parties hereto pursuant to Section 2.1 hereof

        "Stock Option Plan" means one or more employee stock option plans duly
adopted by the Board of Directors of the Company providing for the issuance to
certain employees of the Company and its Subsidiaries of options to purchase
up to 17,500 shares of Common Stock (which may be non-voting Common Stock).

        "Subsidiary" of any specified person or entity means a corporation or
other entity of which a majority of the voting power of the equity securities
or other equity interests is owned, directly or indirectly, by such specified
person or entity or any Subsidiary of such specified person or entity.

        "Transfer" see Section 2.1.

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SECTION 2.     Transfer of Securities.

        2.1.   General Prohibition on Transfer. No Stockholder shall sell,
assign, transfer, pledge, hypothecate, encumber or in any way dispose of
("Transfer") any Shares unless (i) such Stockholder has complied with the
provisions of this Section 2, (ii) the transferee (if other than the Company
or a transferee of Shares pursuant to a transaction set forth in clause (iii)
of the definition of Exempt Transfers (as set forth in Section 2.4) has agreed
to become a party to, and be bound by the terms of, this Agreement and has
executed a supplemental agreement hereto in form and substance reasonably
satisfactory to the Company, and (iii) such Stockholder has delivered to the
Company an opinion of such Stockholder's counsel, in form and substance
reasonably satisfactory to the Company, to the effect that such Transfer is
either exempt from the registration requirements of the Securities Act and the
applicable securities laws of any state or that such registration requirements
have been complied with.

        2.2.   Right of First Offer.

               2.2.1.  If any Stockholder other than a Bear Stearns
        Stockholder who is not prohibited by Section 2.7 from Transferring any
        of his Shares (a "Seller"), desires to Transfer any or all of the
        Shares (the "Transfer Stock") then owned by such Seller to any person
        other than pursuant to an Exempt Transfer (as defined in Section 2.4
        below), such Seller shall reduce to writing the terms pursuant to
        which such Seller desires to Transfer such Shares (a "Transfer
        Offer"). Such Transfer Offer shall identify the number of shares of
        Transfer Stock, the price of the Transfer Stock, the identity of any
        third party offeror, if any, and all the other material terms and
        conditions of such Transfer Offer. The Seller shall provide a written
        notice (the "Transfer Notice") of such Transfer Offer to the Company
        and the Company shall promptly, but in no event later than fifteen
        (15) business days following receipt of notice from the Seller,
        provide written notice of such Transfer Offer to the Bear Stearns
        Stockholders (the "Transfer Offerees"). The Transfer Notice shall
        contain an irrevocable offer (a "First Offer") to sell the Transfer
        Stock to the Transfer Offerees at a price equal to the price and upon
        substantially the same terms as the terms contained in such Transfer
        Offer. The Transfer Offerees shall have the irrevocable right and
        option (the "Right of First Offer"), exercisable as provided below, to
        accept the First Offer as to any or all Shares of the Transfer Stock
        (subject to the priorities, pro rata adjustments and other provisions
        set forth below). Each Transfer Offeree that desires to exercise such
        option with respect to a First Offer shall provide the Seller with an
        irrevocable written notice of acceptance specifying the number of
        Shares of the Transfer Stock which such Transfer Offeree is agreeing
        to purchase pursuant to such First Offer (including any number of
        Shares in excess of such Transfer Offeree's pro rata portion of the
        Transfer Stock (the "Excess Shares"), which shall be binding on said
        Transfer Offeree for the number of Shares in such notice of
        acceptance, or the lesser number of Shares if so allocated pursuant to
        Section 2.2.2 which notice of acceptance must be provided to the
        Seller within fifteen (15) business days after the date the Transfer
        Notice is given (the "Notice Period"), and a copy of which shall
        simultaneously be provided to the Company. The Company shall promptly
        distribute such notice of acceptance to all other Transfer Offerees.

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               2.2.2.  Subject to the Seller's rights pursuant to Section
        2.2.5, the allocation of Transfer Stock to Transfer Offerees pursuant
        to a First Offer shall be made as follows:

               (a)     Each Transfer Offeree is entitled to purchase a number
        of Shares of the Transfer Stock pro rata with all other Transfer
        Offerees based on the respective holdings on the date of delivery of
        the Transfer Offer to the Company of Common Stock by each Transfer
        Offeree at the time of such First Offer.

               (b)     If every Transfer Offeree requests to purchase a number
        of Shares of Transfer Stock equal to or greater than such Transfer
        Offeree' s pro rata portion, then each Transfer Offeree shall be
        entitled to receive such Transfer Offeree's pro rata portion of the
        Transfer Stock (as calculated and set forth in clause (A) above)

               (c)     If any Transfer Offeree requests to purchase a number
        of Shares less than its respective pro rata portion of the Transfer
        Stock, each Transfer Offeree shall (x) first, be entitled to receive
        the number of Shares of Transfer Stock requested for purchase by such
        Transfer Offeree or, if less, the number of Shares of Transfer Stock
        equal to such Transfer Offeree's pro rata portion of the Transfer
        Stock (as calculated and set forth in clause (A) above), and (y)
        second, be entitled to receive that number of any Excess Shares
        requested by such Transfer Offeree equal to the lesser of (A) the
        total number of Excess Shares such Transfer Offeree requested and (B)
        such Transfer Offeree's allocable portion of all Excess Shares based
        on the respective number of shares of Common Stock held by each
        Transfer Offeree who requested Excess Shares, applied on an iterative
        basis to the extent that any such Transfer Offeree's request shall be
        satisfied in full without all Excess Shares being allocated.

               2.2.3.  Subject to the Seller's rights under Section 2.2.5 the
        closing of the purchases of the Transfer Stock by the Transfer
        Offerees who have exercised the options granted pursuant to this
        Section 2.2 shall take place at the principal office of the Company on
        or before the thirtieth (30th) business day after the expiration of
        the Notice Period. At such closing, such Transfer Offerees shall
        deliver a certified check or checks in the appropriate amount to the
        Seller against delivery of certificates representing the Transfer
        Stock so purchased, duly endorsed in blank by the person or persons in
        whose name a stock certificate is registered or accompanied by a duly
        executed assignment separate from the certificate with the signatures
        thereon guaranteed by a commercial bank or trust company.

               2.2.4.  If any shares of the Transfer Stock allocated to an
        accepting Transfer Offeree are not purchased by such Transfer Offeree
        (collectively, the "Transfer Default Stock"), any or all such Shares
        of Transfer Default Stock may be purchased by the other accepting
        Transfer Offerees (the "Default Offerees") but only within five (5)
        business days after notice of the availability of such Transfer
        Default Stock, allocated among such Default Offerees in the manner as
        Shares of Transfer Stock are required to be allocated to Transfer
        Offerees as provided in Section 2.2.2 above. Nothing herein shall
        limit the Seller's legal or equitable remedies against any such
        defaulting Transfer Offeree. If the Default Offerees do not choose to
        purchase all of the Transfer Default Stock, the Seller shall have the
        rights set forth in Section 2.2.5.

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               2.2.5.  Notwithstanding the exercise by any Transfer Offeree of
        its rights under this Section 2.2, if at the end of the Notice Period
        the Transfer Offerees shall have collectively agreed to purchase less
        than all of the Transfer Stock covered thereby (a "Partial Purchase
        Commitment"), the Seller shall promptly notify the Company and the
        accepting Transfer Offerees, as to whether or not it shall accept such
        Partial Purchase Commitment. If such Partial Purchase Commitment is
        accepted, the closing for such purchase of a portion of such Transfer
        Stock shall take place pursuant to Section 2.2.3 hereof. Upon
        acceptance by the Seller of the Partial Purchase Commitment, the
        Seller shall have the right within the time hereinafter specified to
        Transfer any Transfer Stock not included in the Partial Purchase
        Commitment at a price not less than and on terms no more favorable to
        the purchaser than were in the Transfer Notice. If the Seller
        determines not to accept the Partial Purchase Commitment, the Seller
        shall have the right, subject to Section 2.3 below, within the time
        hereinafter specified to Transfer any or all of the Transfer Stock at
        a price not less than and on terms no more favorable to the purchaser
        than contained in the Transfer Notice. If the Company notifies the
        Seller that no Transfer Offeree has agreed to purchase any portion of
        the Transfer Stock, or the Seller has accepted a Partial Purchase
        Commitment and desires to Transfer the remaining Transfer Stock, or
        the Seller has rejected the Partial Purchase Commitment and desires to
        Transfer the Transfer Stock, subject to Section 2.3 below, the Seller
        shall have one hundred twenty (120) days from the end of the Notice
        Period (the "Sales Period"), in which to Transfer any or all of the
        Transfer Stock at a price not less than and on terms no more favorable
        than were contained in the Transfer Notice. No sale may be made to any
        third party unless such third party agrees in writing, in form and
        substance reasonably acceptable to the Company, to be bound by the
        provisions of this Agreement, as a Stockholder. Promptly after any
        sale pursuant to this Section 2.2, the Seller shall notify the Company
        of the consummation thereof and shall furnish such evidence of the
        completion (including time of completion) of such sale and of the
        terms thereof as the Company may reasonably request. If, at the
        termination of the Sales Period, the Seller has not completed the sale
        of all the Transfer Stock, such Seller shall no longer be permitted to
        Transfer such Transfer Stock pursuant to this Section 2.2 without
        again fully complying with the provisions of this Section 2.2 and all
        the restrictions on Transfer contained in this Agreement shall again
        be in effect with respect to all such Seller's Transfer Stock.

        2.3.   Tag-Along Right.

               2.3.1.  In the event that one or more Bear Stearns Stockholders
        ("Seller") propose to Transfer (in a single Transfer or a series of
        related Transfers) shares of Common Stock provided that the Transfer
        is not an Exempt Transfer or a Transfer to other Stockholders pursuant
        to the Right of First Offer set forth in Section 2.2, then each of the
        Stockholders other than the Seller (collectively, the "Tag-Along
        Stockholders") shall have the right (the "Tag-Along Right") to require
        the proposed purchaser to purchase from such Tag-Along Stockholder up
        to the number of whole shares of Common Stock not to exceed the number
        derived by multiplying the total number of shares of Common Stock the
        Seller proposes to Transfer by a fraction, the numerator of which is
        the total number of shares of Common Stock owned by such Tag-Along
        Stockholder, and the denominator of which is the total number of
        shares of Common Stock owned by the Seller and all Tag-Along
        Stockholders. Any shares of Common Stock purchased from Tag-Along
        Stockholders

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        pursuant to this Section 2 shall be paid for in cash, at the same
        price per share and upon the same terms and conditions as such
        proposed Transfer by the Seller.

               2.3.2.  The Seller shall promptly notify the Tag-Along
        Stockholders in writing and shall include in such notice (a "Sale
        Notice), the principal terms and conditions of the proposed Transfer
        including the sale price per share, the number of shares of Common
        Stock proposed to be sold by the Seller and the total number of shares
        of Common Stock held by the Seller and all Tag-Along Stockholders, in
        the event it proposes to make a Transfer giving rise to the Tag-Along
        Right. The Tag-Along Right may be exercised by any Tag-Along
        Stockholder (each, a "Participating Tag-Along Stockholder") by
        delivery of a written notice to the Seller proposing to sell shares of
        Common Stock (the "Tag-Along Notice") within fifteen (15) days
        following delivery of the Sale Notice by the Seller. The Tag-Along
        Notice shall state the amount of shares that such Participating
        Tag-Along Stockholder proposes to include in such Transfer to the
        proposed purchaser (not to exceed the number determined as aforesaid)
        . Each Tag-Along Stockholder who has not so delivered a Tag-Along
        Notice as set forth above shall be deemed to have waived all of his
        rights with respect to participating in the Transfer, and the Seller
        and the Participating Tag-Along Stockholders shall thereafter be free
        to sell to the proposed purchaser, at a price no greater than I 110% of
        the price for such shares of Common Stock set forth in the Tag-Along
        Notice and on other principal terms which are not substantially more
        favorable to the Seller and the Participating Tag-Along Stockholders
        than those set forth in the Sale Notice, without any further
        obligation to such non-accepting Tag-Along Stockholders. If, prior to
        consummation, the terms of such proposed Transfer shall change with
        the result that the price shall be greater than 110% of the share
        price for such shares of Common Stock set forth in the Tag-Along
        Notice or the other principal terms shall be substantially more
        favorable to the Seller and the Participating Tag-Along Stockholders
        than those set forth in the Sale Notice, it shall be necessary for a
        separate Sale Notice to be furnished, and the terms and provisions of
        this Section 2.3 separately complied with, in order to consummate such
        proposed Transfer pursuant to this Section 2.3.

               2.3.3.  The acceptance of each Participating Tag-Along
        Stockholder shall be irrevocable except as hereinafter provided, and
        each such Participating Tag-Along Stockholder shall be bound and
        obligated to sell in the Transfer on the same terms and conditions,
        with respect to each share of Common Stock sold, as the Seller, such
        number of shares of Common Stock as such Participating Tag-Along
        Stockholder shall have specified in such Tag-Along Notice. In the
        event the Seller shall be unable to obtain the inclusion in the
        Transfer of the entire number of shares of Common Stock which the
        Seller and each Participating Tag-Along Stockholder desires to have
        included in the Transfer (as evidenced in the case of the Seller by
        the Tag-Along Notice and in the case of each Participating Tag-Along
        Stockholder by such Participating Tag-Along Stockholder's Tag-Along
        Notice), the number of shares of Common Stock to be sold in the
        Transfer by the Seller and each Participating Tag-Along Stockholder
        shall be reduced on a pro rata basis according to the proportion which
        the number of shares of Common Stock which the Seller and each
        Participating Tag-Along Stockholder desires to have included in the
        Transfer, respectively, bears to the total number of shares of Common

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        Stock desired by the Seller and all the Participating Tag-Along
        Stockholders to have included in the Transfer.

               2.3.4.  If at the end of the 120th day following the date of
        the delivery of the Sale Notice the Seller has not completed the
        Transfer (other than as a result of a breach of this Agreement by a
        Participating Tag-Along Stockholder), each Participating Tag-Along
        Stockholder shall be released from its obligations under his Tag-Along
        Notice, the Sale Notice shall be null and void, and it shall be
        necessary for a separate Sale Notice to be furnished, and the terms
        and provisions of this Section 2.3 separately complied with, in order
        to consummate such Transfer pursuant to this Section 2.3.

        2.4.   Exempt Transfer. The following transactions shall constitute
"Exempt Transfers" for the purpose of Section 2.2, Section 2.3, Section 2.6
and Section 2.7: (i) a Transfer of Shares by a Stockholder to the Company,
(ii) a Transfer of Shares by a Stockholder to any Related Party of such
Stockholder, (iii) a Transfer of Shares by a Stockholder to the public
pursuant to an effective registration statement under the Securities Act or
pursuant to Rule 144 promulgated thereunder, (iv) a Transfer of Shares that
has been approved in writing as an Exempt Transfer by the holders of a
majority of the Bear Stearns Shares and the holders of a majority of the
Management Shares, (v) any Transfer of Shares pursuant to the exercise of such
Stockholder's Tag-Along Rights, (vi) any Transfer by a Bear Stearns
Stockholder that would not result in Bear Stearns and its Related Parties
holding less than eighty-five percent (85%) of the shares of Common Stock held
by all Bear Stearns Stockholders on the date of this Agreement other than the
Shares subject to the Federated Option and the Shares which may be Transferred
to DeBartolo, as described in subsection (vii) of this Section 2.4, (vii) any
Transfer by a Bear Stearns Stockholder of up to 9,300 shares of its Common
Stock to DeBartolo and (viii) any Transfer of Common Stock to the holder of
the Federated Option upon exercise of the Federated Option.

        2.5.   Related Party. As used herein, the term "Related Party" with
respect to any Stockholder means: (A) any person or entity that directly or
indirectly, through one or more intermediaries, has control of or is
controlled by, or is under common control with, the person or entity specified
(an "Affiliate"); (B) a trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, or owners, or persons holding a
controlling interest of which consist of such Stockholder and/or such other
persons or entities referred to in the immediately preceding clause (A) or the
immediately following clause (C); (C) with respect to any Stockholder which is
an individual, such Stockholder's spouse, siblings, children, grandchildren or
parents; (D) with respect to any Stockholder which is a partnership, such
Stockholders' partners as of the date hereof; (E) with respect to any Bear
Stearns Stockholder shall include, without limitation, any fund or other
Person under the control or direction of Bear Stearns or its Related Parties
(provided that if such Related Party is a competitor of the Company of the
kind described in Section 2.7.2, the transferring Bear Stearns Stockholder
shall take reasonable steps to cause confidential financial information
relating to the Company to which the Bear Stearns Stockholders have access by
virtue of their ownership of Common Stock to be withheld from such Related
Party); and (F) with respect to the Management, shall include a voting trust
established by the Management giving Julian Geiger the exclusive right to
exercise all votes exercisable in respect of the Management Shares.

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        2.6.   Company Sale.

               2.6.1.  If, at any time that Bear Stearns Parties own at least
        25,000 shares of Common Stock (which such number shall be adjusted as
        determined by the Board of Directors to reflect any subdivision of
        shares of Common Stock into a greater number of Shares and any
        combination of its outstanding shares of Common Stock into a smaller
        number of Shares (each, a "Stock Adjustment")), the holders of a
        majority of the Common Stock held by the Bear Stearns Parties approve
        a Company Sale (the "Approved Sale"), the Stockholders shall consent
        to and raise no objections against the Approved Sale of the Company,
        and if the Approved Sale of the Company is structured as a sale of
        stock, the holders of Common Stock shall sell their shares of Common
        Stock on the terms and conditions approved by the holders of a
        majority of the Common Stock held by the Bear Stearns Parties. All
        holders of Common Stock shall take all actions that the holders of a
        majority of the Common Stock held by the Bear Stearns Parties
        reasonably deem necessary or desirable in connection with the
        consummation of the Approved Sale of the Company including, without
        limitation, voting their Shares in favor of any resolution of
        Stockholders in which the Approved Sale is considered.

               2.6.2.  The obligations of the holders of Common Stock with
        respect to the. Approved Sale of the Company are subject to the
        satisfaction of the condition that, upon the consummation of the
        Approved Sale (i) all of the Common Stock will receive the same form
        and amount of consideration per share of Common Stock, provided, that
        if any holders of Common Stock are given an option as to the form and
        amount of consideration to be received, all holders will be given the
        same option, (ii) the Bear Stearns Parties receive nothing of value
        pursuant to the transaction other than the same transactional
        consideration per share receivable by all similarly situated
        Stockholders, plus customary indemnification rights and customary fees
        for financial advisory and investment banking services rendered and
        reimbursement of all third party costs, and an officer of the Beat
        Stearns Parties certifies as to the foregoing, and (iii) the aggregate
        maximum liability of any holder of Common Stock under any
        representations, warranties and indemnities given in connection with
        the Approved Sale shall not exceed the proceeds received by such
        holder of Common Stock as a result of the Approved Sale (unless such
        holder of Common Stock otherwise consents) and (iv) the terms of the
        Approved Sale do not impose any non compete obligation on the
        Management in excess of that set forth in their respective employment
        agreements with the Company or a Subsidiary.

               2.6.3.  If the Company or the holders of the Company's
        securities enter into any negotiation or transaction for which Rule
        506 (or any similar rule then in effect) promulgated by the Securities
        and Exchange Commission may be available with respect to such
        negotiation or transaction (including a merger, consolidation or other
        reorganization), the holders of Management Shares will, at the request
        of the Company, appoint a purchaser representative (as such term is
        defined in Rule 501 of the Securities Act) reasonably acceptable to
        the Company. If any holder of Management Shares appoints a purchaser
        representative designated by the Company, the Company will pay the
        fees of such purchaser representative, but if any holder of Management
        Shares declines to appoint another purchaser representative designated
        by the Company, such holder will appoint another purchaser
        representative (reasonably acceptable to the

                                     -9-
<PAGE>

        Company), and such holder will be responsible for the fees of the
        purchaser representative so appointed.

               2.6.4.  The holders of Common Stock will bear their pro rata
        share (based upon the number of shares held by such holders that are
        sold) of the costs of any sale of Common Stock pursuant to an Approved
        Sale to the extent such costs are incurred for the benefit of all
        holders of Common Stock and are not otherwise paid by the Company or
        the acquiring party.

        2.7.   Other Restrictions on Transfer.

        Notwithstanding any other provision hereof:

               2.7.1.  Except for an Exempt Transfer or with the prior written
        consent of the holders of a majority of the Bear Stearns Shares or a
        Transfer upon an Approved Sale, no Management Stockholder may Transfer
        any Shares held by him until the third anniversary of the date of this
        Agreement. No Management Stockholder may pledge, hypothecate or
        encumber the Shares owned by him at any time.

               2.7.2.  Except for an Exempt Transfer or an Approved Sale, or
        with the prior written consent of the holders of a majority of the
        Management Shares, no Bear Stearns Stockholder may Transfer any Shares
        held by him (i) until the second anniversary of the date of this
        Agreement or (ii) to any Person or an Affiliate of any Person whose
        principal business competes with the business of the Company and whose
        principal business is the sourcing and retailing of private label
        specialty men's. and women's apparel which retails at similar price
        points in substantially the same geographic area within the United
        States as the Company; and

               2.7.3.  Except for an Exempt Transfer or upon an Approved Sale,
        no Federated Stockholder may Transfer any Shares held by him to any
        Person or any Person who is an Affiliate of any Person that engages in
        any business that competes with the businesses then conducted by the
        Company and its Subsidiaries.

        2.8.   Certain Legal Requirements. In the event the consideration to
be paid in exchange for shares of Common Stock in the proposed Transfer
pursuant to Section 2.3 or Section 2.6 includes any securities and the receipt
thereof by a holder of Common Stock as a Participating Tag-Along Stockholder
or pursuant to an Approved Sale (collectively, the "Participating Sellers")
would require under applicable law either (i) the registration or
qualification of such securities or of any person as a broker or dealer or
agent with respect to such securities or (ii) the provision to any participant
in the Transfer of any information other than such information as would be
required under Regulation D in an offering made pursuant to Regulation D
solely to "accredited investors" as defined in Regulation D, the Seller shall
be obligated only to use its reasonable efforts to cause the requirements
under Regulation D to be complied with to the extent necessary to permit such
Participating Seller to receive such securities, but shall not have any
obligation to effect a registration of such securities under the Securities
Act or similar state statutes. If use of reasonable efforts would not result
in the applicable requirements being complied with to the extent necessary to
permit such Participating Seller to receive such

                                     -10-
<PAGE>

securities, the Seller may cause to be paid to such Participating Seller in
lieu thereof, against surrender of the shares of Common Stock which would have
otherwise been sold by such Participating Seller to the proposed buyers under
Section 2.3 or Section 2.6 (collectively, the "Proposed Buyers") in the
Transfer, an amount in cash equal to the fair market value of the securities
which such Participating Seller would otherwise receive as of the date of the
issuance of such, securities in exchange for shares of Common Stock (as
determined by the Board of Directors (including the affirmative vote of a
member of the Board of Directors appointed pursuant to Section 5.2.3, if
any)), except that in connection with a proposed Transfer pursuant to Section
2.3, any Participating Seller may elect to be excluded from the Transfer
rather than receiving cash pursuant to this Section 2.8. The obligation of the
Seller to use reasonable efforts to cause such requirements to have been
complied with to the extent necessary to permit a Participating Seller to
receive such securities shall be conditioned on such Participating Seller
executing such documents and instruments, and taking such other actions
(including, without limitation, if required by the Seller, agreeing to be
represented during the course of such transaction by a "purchaser
representative" (as defined in Regulation D) in connection with evaluating the
merits and risks of the prospective investment and acknowledging that he was
so represented), as the Seller shall reasonably request in order to permit
such requirements to be complied with. Each Participating Seller agrees to
take such actions as the Seller shall reasonably request in order to permit
such requirements to be complied with, and no Participating Seller shall have
the right to require that such Participating Seller receive cash in lieu of
securities if such requirements have not been complied with by such
Participating Seller.

SECTION 3.     Preemptive Right. The Company hereby grants to each Stockholder
the right to purchase, pro rata, all or any part of New Securities (as defined
in Section 3.1 below) which the Company may, from time to time, propose to
sell and issue. A pro rata portion, for purposes of this Agreement, is the
ratio of the number of shares of Common Stock held by such Stockholder
immediately prior to any purchase to the total number of shares of Common
Stock of the Company issued and outstanding at such time. Each Stockholder
shall have a right of over-allotment such that if any person fails to exercise
its right hereunder to purchase its pro rata portion of New Securities, the
other Stockholders may purchase the non-purchasing Stockholder's portion on a
pro rata basis within five (5) business days from the date it receives notice
from the Company that such person has failed to exercise its right hereunder
to purchase its pro rata share of New Securities.

        3.1.   For the purpose of this Section 3, "New Securities" shall mean
shares of Common Stock of the Company of any kind whether now or hereinafter
authorized, and rights, options or wan-ants to purchase such Common Stock, and
securities of any kind whatsoever that are, or may become, convertible into or
exchangeable for such Common Stock; provided, however, that the preemptive
right shall apply at the time of issuance of the right, warrant, option or
convertible or exchangeable security and not to the conversion, exchange or
exercise thereof, and provided, further, that the term "New Securities" shall
not include: (A) the securities of the Company issued pursuant to the terms of
the Subscription Agreements, the Purchase Agreement or the Stock Purchase
Agreement, (B) any Common Stock of the Company offered pursuant to a
registration statement which has been declared effective after the date hereof
under the Securities Act, whereby such securities shall be publicly traded on
a national securities exchange or quoted on the National Association of
Securities Dealers, Inc., Automatic Quotation System or National Market System
("NASDAQ) or otherwise broadly distributed to the general public (a "Qualified

                                     -11-
<PAGE>

Public Offering"), (C) an issuance of Shares to a seller as consideration for
an acquisition by the Company of any other Person or all or substantially all
of the business and assets of any other Person or a division of any Person,
(D) shares of Common Stock of the Company or options to purchase such Common
Stock granted or to be granted in connection with the Stock Option Plan
(provided that such Shares in the aggregate may not exceed seventeen and one
half percent (17.5%) of the outstanding shares of the Common Stock of the
Company On a Fully Diluted Basis immediately after consummation of all
transactions contemplated by the Purchase Agreement and the Stock Purchase
Agreement) and (E) the issuance of Shares in connection with any debt or
preferred stock financing of the Company (provided that such Shares in the
aggregate issued in connection with such financings may not exceed five
percent (5%) of the outstanding shares of the Common Stock of the Company On a
Fully Diluted Basis immediately after the consummation of the transactions
contemplated by the Purchase Agreement and the Stock Purchase Agreement).

        3.2.   In the event the Company proposes to issue New Securities, it
shall give each Stockholder written notice of its intention, describing the
type of New Securities, the price and the general terms upon which the Company
proposes to issue the same. Each Stockholder shall have fifteen (15) business
days from the date of receipt of any such notice to agree to purchase a pro
rata share of such New Securities for the price and upon the general terms
specified in the notice by giving written notice to the Company and stating
therein the quantity of New Securities to be purchased.

        3.3.   In the event that the Stockholders fail to exercise their
preemptive rights with respect to all of the New Securities proposed to be
sold by the Company within said ten (10) business day period and after the
expiration of the five (5) business day period for the exercise of the
over-allotment provisions of this Section 3, the Company shall have one
hundred twenty (120) days thereafter to sell or enter into an agreement
(pursuant to which the sale of New Securities covered thereby shall be closed,
if at all, within one hundred twenty (120) days from the date of said
agreement), to sell the New Securities respecting which the Stockholders'
rights were not exercised, at a price and upon general terms no more favorable
to the purchasers thereof than specified in the Company's notice. In the event
the Company has not sold such New Securities within said one hundred twenty
(120) day period (or sold and issued New Securities in accordance with the
foregoing within one hundred twenty (120) days from the date of said
agreement), the Company shall not thereafter issue or sell any New Securities,
without first offering such securities to the Stockholders in the manner
provided above.

SECTION 4.     Registration Right.

        4.1.   Piggyback Registration Rights.

               4.1.1.  Right to Piggyback. Subject to the last sentence of
        this Section 4.1.1, whenever the Company proposes to register any
        shares of Common Stock (or securities convertible into. or
        exchangeable for, or options, warrants or other rights to acquire,
        Common Stock) with the Securities and Exchange Commission (the
        "Commission") under the Securities Act (other than registrations on
        Form S-4 or Form S-8 or any successor or similar forms) and the
        registration form to be used may be used for the registration of the
        Registrable Securities (as defined in Section 4.10 below) (a
        "Piggyback

                                     -12-
<PAGE>

        Registration"), the Company will give written notice to all
        Stockholders, at least thirty (30) days prior to the anticipated
        filing date, of its intention to effect such a registration, which
        notice will specify the proposed offering price, the kind and number
        of securities proposed to be registered, the distribution arrangements
        and such other information that at the time would be appropriate to
        include in such notice, and will, subject to Section 4.1.2 below,
        include in such Piggyback Registration all Registrable Securities with
        respect to which the Company has received written requests for
        inclusion therein within ten (10) business days after the
        effectiveness of the Company's notice. Except as may otherwise be
        provided in this Agreement, Registrable Securities with respect to
        which such request for registration has been received will be
        registered by the Company and offered to the public in a Piggyback
        Registration pursuant to this Section 4 on the terms and conditions at
        least as favorable as those applicable to the registration of shares
        of Common Stock (or securities convertible into or exchangeable or
        exercisable for Common Stock) to be sold by the Company and by any
        other person selling under such Piggyback Registration, provided that
        if, at any time after giving written notice of its intention to
        register any securities and prior to the effective date of the
        registration statement filed in connection with such registration, the
        Company shall determine for any reason either not to register any or
        to delay registration, of such securities, the Company may, at its
        election, give written notice of such determination to each holder of
        Common Stock and, thereupon, (i) in the case of a determination not to
        register, shall be relieved of its obligation to register any Common
        Stock in connection with such registration (but not from its
        obligation to pay the registration expenses in connection therewith as
        set forth in Section 4.5), and (ii) in the case of a determination to
        delay registering, shall be permitted to delay registering any Common
        Stock, for the same period as the delay in registering such other
        securities.

               4.1.2.  Priority on Piggyback Registrations. If the managing
        underwriter or underwriters, if any, advise the holders of Registrable
        Securities in writing that in its or their reasonable opinion or, in
        the case, of a Piggyback Registration not being. underwritten, the
        Company shall reasonably determine (and notify the holders of
        Registrable Securities of such determination), after consultation with
        an investment banker of nationally recognized standing, that the
        number or kind of securities proposed to be sold in such registration
        (including Registrable Securities to be included pursuant to Section
        4.1.1 above) will materially adversely affect the success of such
        offering (including, without limitation, an impact on the selling
        price), the Company will include in such registration the number of
        securities, if any, which, in the opinion of such underwriter or
        underwriters, or the Company, as the case may be, can be sold, as
        follows: (i) first, the shares the Company proposes to sell, and (ii)
        second, the Registrable Securities requested to be included in such
        registration by the requesting Stockholders, pro rata among such
        requesting Stockholders on the basis of their respective holdings of
        Common Stock.

               4.1.3.  Selection of Underwriters. If any Piggyback
        Registration is an underwritten offering, the Company (by action of
        the Board of Directors) will select a managing underwriter or
        underwriters to administer the offering, which managing underwriter or
        underwriters will be of nationally recognized standing (which may be a

                                     -13-
<PAGE>

        Related Party of Bear Stearns) and reasonably acceptable to the
        holders of a majority of the Registrable Securities included therein.

        4.2.   Demand Registration Rights.

               4.2.1.  Right to Demand Registration. (a) The Bear Stearns
        Stockholders as a group (the "Bear Demanding Group") shall have the
        right on any three occasions after the date hereof to make a written
        request of the Company for registration with the Commission, under and
        in accordance with the provisions of the Securities Act, of all or
        part of their Registrable Securities (a "Demand Registration").

               (b)     Provided that (i) the Company has consummated a
        Qualified Public Offering on or prior to May 3, 1999, (ii) the
        Federated Option has been exercised in full and (iii) the sale by the
        Federated Stockholders of the Common Stock then held by them is
        restricted by the volume limitations Rule 144 promulgated under the
        Securities Act, the Federated Stockholders as a group (the "Federated
        Demanding Group") shall have the right on any one occasion after May
        3, 1999 but on or before January 3, 2000 to make a written request of
        the Company for a Demand Registration. Each of the Bear Demanding
        Group and the Federated Demanding Group shall be a "Demanding Group".

               (c)     Notwithstanding any demand under subsections (a) and
        (b) of this Section 4.2.1: (x) the Company need not effect a Demand
        Registration unless such Demand Registration has been requested by
        persons holding a least a majority of the Registrable Securities held
        collectively by the relevant Demanding Group on the date of such
        written request, (y) the Company may, if the Board of Directors
        determines in the exercise of its reasonable judgment that due to a
        pending or contemplated acquisition or disposition, to effect such
        Demand Registration at such time would have a material adverse effect
        on the Company, defer such Demand Registration for a single period not
        to exceed one hundred eighty (180) days (but if the Company elects to
        defer any Demand Registration pursuant to the terms of this sentence,
        no Demand Registration shall be deemed to have occurred for purposes
        of this Agreement) and (z) the Company shall be obligated to effect
        only the number of Demand Registrations set forth in Section 4.2.2
        below. Within ten (10) days after receipt of the request for a Demand
        Registration, the Company will send written notice (the "Notice) of
        such registration request and its intention to comply therewith to all
        members of the relevant Demanding Group who are holders of Registrable
        Securities and, subject to Section 4.2.3 below, the Company will
        include in such registration all Registrable Securities of such
        members of the relevant Demanding Group with respect to which the
        Company has received written requests for inclusion therein within
        twenty (20) business days after the effectiveness of the Notice. All
        requests made pursuant to this Section 4.2.1 will specify the
        aggregate number of Registrable Securities requested to be registered
        and will also specify the intended methods of disposition thereof.

               (d)     The demand right of the Bear Demanding Group set forth
        in Section 4.2.1(a) may not be exercised in respect of Registrable
        Securities which have an estimated market value (upon consummation of
        the demand registration) of less then $5.0 million in the aggregate.

                                     -14-
<PAGE>

               (e)     The demand right of the Federated Demanding Group set
        forth in Section 4.2.1(b) may not be exercised in respect of
        Registrable Securities which constitute, in the aggregate, less than
        one percent (1%) of the outstanding Common Stock upon the date of
        exercise of such demand right.

               4.2.2.  Number of Demand Registrations. The Bear Demanding
        Group shall be entitled to three (3) Demand Registrations, and,
        subject to the satisfaction of the conditions described in Section
        4.2.1 above, the Federated Demanding Group shall be entitled to one
        (1) Demand Registration and the expenses of each (including the fees
        and expenses of one counsel for the Demanding Group then exercising
        its demand rights hereunder in accordance with Section 4.5.2 below)
        shall be borne by the Company. A Demand Registration shall not be
        counted as a Demand Registration hereunder until such Demand
        Registration has been declared effective by the Commission and
        maintained continuously effective for a period of at least three
        months or such shorter period when all Registrable Securities included
        therein have been sold in accordance with such Demand Registration. If
        the Company elects to issue and sell any equity securities pursuant to
        any Registration Statement filed in connection with a Demand
        Registration, then such Registration shall be deemed not to be a
        Demand Registration for purposes of determining the number of Demand
        Registrations granted by this Agreement.

               4.2.3.  Priority on Demand Registrations. If in any Demand
        Registration the managing underwriter or underwriters thereof (or in
        the case of a Demand Registration not being underwritten, the holders
        of a majority of the Registrable Securities held by the Demanding
        Group then exercising its demand rights hereunder after consultation
        with an investment banker of nationally recognized standing), advise
        the Company in writing that in its or their reasonable opinion the
        number of securities proposed to be sold in such Demand Registration
        exceeds the number that can be sold in such offering without having a
        material adverse effect on the success of the offering (including,
        without limitation, an impact on the selling price), the Company will
        include in such registration only the number of securities that, in
        the reasonable opinion of such underwriter or underwriters (or such
        holders of Registrable Securities held by the relevant Demanding
        Group, as the case may be) can be sold without having a material
        adverse effect on the success of the offering, as follows: (i) first,
        the Registrable Securities requested to be included in such Demand
        Registration by the requesting Stockholders, including the Demanding
        Group, pro rata, among such Stockholders on the basis of their
        respective holdings and (ii) second, shares to be issued and sold by
        the Company or shares held by persons other than the Stockholders and
        requested to be included in such Demand Registration (if any).

               4.2.4.  Selection of Underwriters. If a Demand Registration is
        an underwritten offering, the holders of a majority of the Registrable
        Securities to be included in such Demand Registration held by members
        of the Demanding Group who then exercising its demand rights hereunder
        will select a managing underwriter or underwriters of recognized
        national standing (which may be a Related Party of Bear Stearns) to
        administer the offering.

                                     -15-
<PAGE>

        4.3.   Registration Procedures. With respect to any Piggyback
Registration or Demand Registration (generically, a "Registration"), the
Company will, subject to Sections 4.1.2 and 4.2.3 as expeditiously as
practicable:

               4.3.1.  prepare and file with the Commission, within 60 days
        after mailing the applicable Notice, a registration statement or
        registration statements (the "Registration Statement") relating to the
        applicable Registration on any appropriate form under the Securities
        Act, which form shall be available for the sale of the Registrable
        Securities in accordance with the intended method or methods of
        distribution thereof; provided that the Company will include in any
        Registration Statement on a form other than Form S-1 all information
        that the holders of the Registrable Securities so to be registered
        shall reasonably request and shall include all financial statements
        required by the Commission to be filed therewith, cooperate and assist
        in any filings required to be made with the National Association of
        Securities Dealers, Inc. ("NASD"), and use its best efforts to cause
        such Registration Statement to become effective; provided further that
        before filing a Registration Statement or prospectus related thereto
        (a "Prospectus") or any amendments or supplements thereto, the Company
        will furnish to the holders of the Registrable Securities covered by
        such Registration Statement and the underwriters, if any, copies of
        all such documents proposed to be filed, which documents will be
        subject to the reasonable review of such holders and underwriters and
        their respective counsel, and the Company will not file any
        Registration Statement or amendment thereto or any Prospectus or any
        supplement thereto to which the holders of a majority of the
        Registrable Securities covered by such Registration Statement or the
        underwriters, if any, shall reasonably object;

               4.3.2.  prepare and file with the Commission such amendments
        and post-effective amendments to the Registration Statement as may be
        necessary to keep each Registration Statement effective for the
        applicable period, or such shorter period which will terminate when
        all Registrable Securities covered by such Registration Statement have
        been sold; cause each Prospectus to be supplemented by any required
        Prospectus supplement, and as so supplemented to be filed pursuant to
        Rule 424 under the Securities Act; and to comply fully with Rules 424,
        430A and 462, as applicable, under the Securities Act in a timely
        manner; and comply with the provisions of the Securities Act with
        respect to the disposition of all securities covered by such
        Registration Statement during the applicable period in accordance with
        the intended method or methods of distribution by the sellers thereof
        set forth in such Registration Statement or supplement to the
        Prospectus; the Company shall not be deemed to have used its best
        efforts to keep a Registration Statement effective during the
        applicable period if it voluntarily takes any action that would result
        in selling holders of the Registrable Securities covered thereby not
        being able to sell such Registrable Securities during that period
        unless such action is required under applicable law, provided that the
        foregoing shall not apply to actions taken by the Company in good
        faith and for valid business reasons, including without limitation the
        acquisition or divestiture of assets, so long as the Company promptly
        thereafter complies with the requirements of Section 4.3.11, if
        applicable;

               4.3.3.  notify the selling holders of Registrable Securities
        and the managing underwriters, if any, promptly, and (if requested by
        any such person or entity) confirm

                                     -16-
<PAGE>

        such advice in writing, (A) when the Prospectus or any Prospectus
        supplement or post-effective amendment has been filed, and, with
        respect to the Registration Statement or any post-effective amendment,
        when the same has become effective, (B) of any request by the
        Commission for amendments or supplements to the Registration Statement
        or the Prospectus or for additional information, (C) of the issuance
        by the Commission of any stop order suspending the effectiveness of
        the Registration Statement or the initiation of any proceedings for
        that purpose, (D) if at any time the representations and warranties of
        the Company contemplated by Section 4.3.14 below cease to be true and
        correct, (E) of the receipt by the Company of any notification with
        respect to the suspension of the qualification of the Registrable
        Securities for sale in any jurisdiction or the initiation or
        threatening of any proceeding for such purpose and (F) of the
        happening of any event which makes any statement made in the
        Registration Statement, the Prospectus or any document incorporated
        therein by reference untrue or which requires the making of any
        changes in the Registration Statement, the Prospectus or any document
        incorporated therein by reference in order to make the statements
        therein not misleading;

               4.3.4.  make every reasonable effort to obtain the withdrawal
        of any order suspending the effectiveness of the Registration
        Statement at the earliest possible moment;

               4.3.5.  if requested by the managing underwriter or
        underwriters or a holder of Registrable Securities being sold in
        connection with an underwritten offering, promptly incorporate in a
        Prospectus supplement or post-effective amendment such information as
        the managing underwriters and the holders of a majority of the
        Registrable Securities being sold agree should be included therein
        relating to the plan of distribution with respect to such Registrable
        Securities, including, without limitation, information with respect to
        the number of Registrable Securities being sold to such underwriters,
        the purchase price being paid therefor by such underwriters and with
        respect to any other terms of the underwritten (or best efforts
        underwritten) offering of the Registrable Securities to be sold in
        such offering; and make all required filings of such Prospectus
        supplement or post-effective amendment as soon as notified of the
        matters to be incorporated in such Prospectus supplement or
        post-effective amendment;

               4.3.6.  furnish to each selling holder of Registrable
        Securities and each managing underwriter, without charge, at least one
        signed copy of the Registration Statement, as first filed with the
        Commission, and any amendment thereto, including financial statements
        and schedules, all documents incorporated therein by reference and all
        exhibits (including those incorporated by reference);

               4.3.7.  deliver to each selling holder of Registrable
        Securities and the underwriters, if any, without charge, as many
        copies of the Prospectus (including each preliminary prospectus) and
        any amendment or supplement thereto as such selling holder of
        Registrable Securities and underwriters may reasonably request; the
        Company consents to the use of each Prospectus or any amendment or
        supplement thereto by each of the selling holders of Registrable
        Securities and the underwriters, if any, in connection with the
        offering and sale of the Registrable Securities covered by such
        Prospectus or any amendment or supplement thereto;

                                     -17-
<PAGE>

               4.3.8.  prior to any public offering of Registrable Securities,
        register or qualify or cooperate with the selling holders of
        Registrable Securities, the underwriters, if any, and their respective
        counsel in connection with the registration or qualification of such
        Registrable Securities for offer and sale under the securities or
        "blue sky" laws of such jurisdictions as any seller or underwriter
        reasonably requests in writing, considering the amount of Registrable
        Securities proposed to be sold in each such jurisdiction, and do any
        and all other acts or things necessary or advisable to enable the
        disposition in such jurisdictions of the Registrable Securities
        covered by the Registration Statement; provided that the Company will
        not be required to qualify generally to do business in any
        jurisdiction where it is not then so qualified or to take any action
        that would subject it to general service of process or to taxation,
        other than as to matters and transactions relating to the Registration
        Statement, in any such jurisdiction where it is not then so subject;

               4.3.9.  cooperate with the selling holders of Registrable
        Securities and the managing underwriters, if any, to facilitate the
        timely preparation and delivery of certificates representing
        Registrable Securities to be sold and not bearing any restrictive
        legends and to be in such denominations and registered in such names
        as the underwriters may request at least two business days prior to
        any sale of Registrable Securities to the underwriters;

               4.3.10. use its best efforts to cause the Registrable
        Securities covered by the applicable Registration Statement to be
        registered with or approved by such other governmental agencies or
        authorities as may be necessary to enable the seller or sellers
        thereof or the underwriters, if any, to consummate the disposition of
        such Registrable Securities;

               4.3.11. upon the occurrence of any event contemplated by
        Section 4.3.3(F) above, prepare a supplement or post-effective
        amendment to the Registration Statement or the related Prospectus or
        any document incorporated therein by reference or file any other
        required document so that, as thereafter delivered to the purchasers
        of the Registrable Securities, the Prospectus will not contain an
        untrue statement of a material fact or omit to state any material fact
        necessary to make the statements therein not misleading;

               4.3.12. cause all Registrable Securities covered by any
        Registration Statement to be listed on each securities exchange on
        which similar securities issued by the Company are then listed, or
        cause such Registrable Securities to be authorized for trading on the
        NASDAQ National Market System if any similar securities issued by the
        Company are then so authorized, if requested by the holders of a
        majority of such Registrable Securities or the managing underwriters,
        if any;

               4.3.13. provide a CUSIP number for all Registrable Securities,
        not later than the effective date of the applicable Registration
        Statement;

               4.3.14. enter into such agreements (including an underwriting
        agreement) and take all such other actions in connection therewith in
        order to expedite or facilitate the disposition of such Registrable
        Securities and in such connection, whether or not an underwriting
        agreement is entered into and whether or not the Registration is an

                                     -18-
<PAGE>

        underwritten Registration (A) make such representations and warranties
        to the holders of such Registrable Securities and the underwriters, if
        any, in form, substance and scope as are customarily made by issuers
        to underwriters in primary underwritten offerings; (B) obtain opinions
        of counsel to the Company and updates thereof (which counsel and
        opinions (in form, scope and substance) shall be reasonably
        satisfactory to the managing underwriters, if any, and the holders of
        a majority of the Registrable Securities being sold) addressed to each
        selling holder and the underwriters, if any, covering the matters
        customarily covered in opinions requested in underwritten offerings
        and such other matters as may be reasonably requested by such holders
        and underwriters; (C) obtain "cold comfort" letters and updates
        thereof from the Company's independent certified public accountants
        addressed to the selling holders of. Registrable Securities and the
        underwriters, if any, such letters to be in customary form and
        covering matters of the type customarily covered in "cold comfort"
        letters by underwriters in connection with primary underwritten
        offerings; (D) if an underwriting agreement is entered into, the same
        shall set forth in full the indemnification provisions and procedures
        set forth in Section 4.6 below with respect to all parties to be
        indemnified pursuant to said Section 4.6; and (E) the Company shall
        deliver such documents and certificates as may be requested by the
        holders of a majority of the Registrable Securities being sold and the
        managing underwriters, if any, to evidence compliance with Section
        4.3.3(F) above and with any customary conditions contained in the
        underwriting agreement or other agreement entered into by the Company.
        The above shall be done at each closing under such underwriting or
        similar agreement or as and to the extent required thereunder;

               4.3.15. make available for inspection by a representative of
        the holders of a majority of the Registrable Securities, any
        underwriter participating in any disposition pursuant to such
        Registration, and any attorney or accountant retained by the sellers
        or underwriter, all financial and other records, pertinent corporate
        documents and properties of the Company, and cause the Company's
        officers, directors and employees to supply all information reasonably
        requested by any such representative, underwriter, attorney or
        accountant in connection with such Registration Statement; provided
        that any records, information or documents that are designated by the
        Company in writing as confidential shall be kept confidential by such
        Persons unless disclosure of such records, information or documents is
        required by court or administrative order or any regulatory body
        having jurisdiction;

               4.3.16. otherwise use its best efforts to comply with all
        applicable rules and regulations of the Commission, and make generally
        available to its security holders, earnings statements satisfying the
        provisions of Section 11(a) of the Securities Act, no later than
        forty-five (45) days after the end of any twelve (12)-month period (or
        ninety (90) days, if such period is a fiscal year) (A) commencing at
        the end of any fiscal quarter in which Registrable Securities are sold
        to underwriters in a firm or best efforts underwritten offering, or
        (B) if not sold to underwriters in such an offering, beginning with
        the first month of the Company's first fiscal quarter commencing after
        the effective date of the Registration Statement, which statements
        shall cover said twelve (12)-month periods;

                                     -19-
<PAGE>

               4.3.17. promptly prior to the filing of any document that is to
        be incorporated by reference into any Registration Statement or
        Prospectus (after initial filing of the Registration Statement),
        provide copies of such document to the selling holders of Registrable
        Securities and to the managing underwriters, if any, make the
        Company's representatives available for discussion of such document
        and other customary due diligence matters and make such changes in
        such document prior to the filing thereof as such selling holders or
        underwriters may reasonably request;

               4.3.18. provide promptly to each selling holder of Registrable
        Securities and the underwriter, if any, upon request, each document
        filed with the Commission pursuant to the requirements of Section 13
        or Section 15(d) of the Exchange Act; and

               4.3.19. take such other action that may be requested by a seller
        of Common Stock that are customary and reasonably required in connection
        with the sale of Registrable Securities to which the Registration is
        being effected, including, in, the case of an underwritten offering,
        cause the Company's executive officers, including its chief executive
        officer and chief financial officer, to be available to meet with
        potential investors and to participate in any "roadshow" requested by
        the underwriters and which in the underwriters' judgment is reasonably
        necessary or appropriate for the sale of the Registrable Securities as
        to which the Registration is being effected.

        The Company may require each seller of Registrable Securities as to
which any Registration is being effected to famish to the Company such
information regarding the proposed distribution of such securities as the
Company may from time to time reasonably request in writing.

        Each holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 4.3.3(F) such
holder will forthwith discontinue disposition of Registrable Securities
pursuant to the Registration Statement until such holder's receipt of copies
of the supplemented or amended Prospectus as contemplated by Section 4.3.11,
or until it is advised in writing (the "Advice") by the Company that the use
of the Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus,
and, if so directed by the Company, such holder will deliver to the Company
(at the Company's expense) all copies, other than permanent file copies then
in such holder's possession, of the Prospectus covering such Registrable
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the time periods referred to in Section
4.3.2 shall be extended by the number of days during the period from and
including the date of the giving of such notice to and including the date when
each seller of Registrable Securities covered by such Registration Statement
shall have received the copies of the supplemented or amended prospectus
contemplated by Section 4.3.11 or the Advice.

        4.4.   Restrictions on Public Sale.

               4.4.1.  Public Sale by Holders of Registrable Securities. To
        the extent not inconsistent with applicable law, each Stockholder, if
        requested by the managing underwriter or underwriters for any such
        Registration, agrees not to sell, make any short

                                     -20-
<PAGE>

        sale of, loan, grant any option for the purchase of, effect any public
        sale or distribution of or otherwise dispose of any Common Stock (or
        securities convertible into or exchangeable or exercisable for Common
        Stock), including a sale pursuant to Rule 144 (or any similar
        provision then in force) under the Securities Act, in violation of
        Regulation M or during the 15 business days prior to, and during the
        one hundred eighty (180)-day period (or such shorter period as may be
        agreed to by such holders) beginning on, the effective date of the
        applicable Registration Statement (except as part of such
        Registration).

               4.4.2.  Public Sale by the Company and Others. If requested by
        the managing underwriter or underwriters for any underwritten
        Registration, (i) whether or not it participates in such Registration,
        the Company will not sell, make any short sale of, loan, grant any
        option for the purchase of, effect any public sale or distribution of
        or otherwise dispose of any Common Stock (or securities convertible
        into or exchangeable or exercisable for Common Stock) in violation of
        Regulation M or during the fifteen (15) business days prior to, and
        during the one hundred eighty (180) day period beginning on the
        effective date of such Registration and (ii) the Company will cause
        each holder of Common Stock (or securities convertible into or
        exchangeable or exercisable for Common Stock) purchased from the
        Company or pursuant to the Federated Option at any time after the date
        of this Agreement (other than in a registered public offering)
        including without limitation Federated in respect of the Common Stock
        subject to the Federated Option (whether or not the Federated Option
        has been exercised) to agree not to sell, make any short sale of,
        loan, grant any option for the purchase of, effect any public sale or
        distribution of or otherwise dispose of any such securities during
        such period described in clause (i) above (except as part of such
        Registration, if otherwise permitted) whether or not such holder has
        participated in the Registration.

               4.4.3.  Other Registrations. If the Company has previously
        filed a Registration Statement with respect to Registrable Securities,
        and if such previous Registration has not been withdrawn or abandoned,
        the Company will not file or cause to be effected any other
        registration of any of its Common Stock (or securities convertible
        into or exchangeable or exercisable for Common Stock) under the
        Securities Act (except on Form S-8 or any similar successor form),
        whether on its own behalf or at the request of any holder or holders
        of Common Stock (or securities convertible into or exchangeable or
        exercisable for Common Stock), until a period of at least three (3)
        months has elapsed from the effective date of such previous
        Registration; provided, that if the holders of fifty percent (50%) or
        more of the aggregate number of Registrable Securities included in
        such previous Registration shall agree in writing, such period may be
        shortened to a period specified by such holders.

        4.5.   Registration Expenses.

               4.5.1.  All expenses incident to the Company's performance of
        or compliance, with this Agreement will be borne by the Company,
        including, without limitation, all registration and filing fees, the
        fees and expenses of the counsel and accountants for the Company
        (including the expenses of any "cold comfort" letters and special.,
        audits required by or incident to the performance of such persons),
        all other costs and expenses

                                     -21-
<PAGE>

        of the Company incident to the preparation, printing and filing under
        the Securities Act of the Registration Statement (and all amendments
        and supplements thereto) and furnishing copies thereof and of the
        Prospectus included therein, the costs and expenses incurred by the
        Company in connection with the qualification of the Registrable
        Securities under the state securities or "blue sky" laws of various
        jurisdictions, the costs and expenses associated with filings required
        to be made with the NASD (including, if applicable, the fees and
        expenses of any "qualified independent underwriter" and its counsel as
        may be required by the rules and regulations of the NASD), the costs
        and expenses of listing the Registrable Securities for trading on a
        national securities exchange or authorizing them for trading on NASDAQ
        and all other costs and expenses incurred by the Company in connection
        with any Registration hereunder; provided that, except as otherwise
        provided in Section 4.5.2, each Stockholder shall bear the costs and
        expenses of any underwriters' commissions, brokerage fees or transfer
        taxes relating to the Registrable Securities sold by such Stockholders
        and the fees and expenses of any counsel, accountants or other
        representative retained by Stockholder.

               4.5.2.  Notwithstanding the foregoing and except as provided
        below, in connection with each Registration hereunder, the Company
        will reimburse the Stockholders who are holders of Registrable
        Securities being registered in any Registration hereunder for (i) the
        reasonable fees and disbursements of not more than one counsel, which
        counsel shall be chosen (x) by the holders of a majority of the
        Registrable Securities to be included therein that are held by the
        Demanding Group in respect of such registration in the case of a
        Demand Registration and (y) otherwise, by the holders of a majority of
        all Registrable Securities to be included therein, and (ii) the
        reasonable out-of-pocket expenses of the holders of Registrable
        Securities in connection with such Registration, including travel
        costs (if any).

        4.6.   Indemnification.

               4.6.1.  Indemnification by the Company. The Company agrees to
        indemnify, to the full extent permitted by law, each Stockholder, its
        officers, directors, partners and agents and each person who controls
        such Stockholder (within the meaning of the Securities Act and the
        Securities Exchange Act of 1934, as amended (the "Exchange Act)),
        against all losses, claims, damages, liabilities and expenses caused
        by any untrue or alleged untrue, statement of a material fact
        contained in any Registration Statement, Prospectus or preliminary
        Prospectus or any omission or alleged omission to state therein a
        material fact necessary to make the statements therein (in the case of
        a Prospectus or any preliminary Prospectus, in light of the
        circumstances under which they were made) not misleading, except
        insofar as the same are caused by or contained in any information with
        respect to such Stockholder furnished in writing to the Company by
        such Stockholder or its representative expressly for use therein. The
        Company will also indemnify underwriters, selling brokers, dealer
        managers and similar securities industry professionals participating
        in the distribution, their officers and directors and each person who
        controls such persons (within the meaning of the Securities Act) to
        the same extent as provided above with respect to the indemnification
        of the holders of Registrable Securities; provided, however, if
        pursuant to an underwritten public offering of Registrable Securities,
        the Company and any underwriters enter into an underwriting or

                                     -22-
<PAGE>

        purchase agreement relating to such offering that contains provisions
        relating to indemnification and contribution between the Company and
        such underwriters, such provisions shall be deemed to govern
        indemnification and contribution as between the Company and such
        underwriters.

               4.6.2.  Indemnification by Holders of Registrable Securities.
        In connection with any Registration in which a Stockholder is
        participating, each such Stockholder will furnish to the Company in
        writing such information with respect to such Stockholder as the
        Company reasonably requests for use in connection with any
        Registration Statement or Prospectus and agrees to indemnify, to the
        full extent permitted by law, the Company, the directors and officers
        of the Company signing the Registration Statement and each person who
        controls the Company (within the meaning of the Securities Act and the
        Exchange Act) against any losses, claims, damages, liabilities and
        expenses resulting from any untrue statement of a material fact or any
        omission to state a material fact required to be stated therein or
        necessary to make the statements in the Registration Statement or
        Prospectus or preliminary Prospectus (in the case of the Prospectus or
        any preliminary Prospectus, in light of the circumstances under which
        they were made) not misleading, to the extent, but only to the extent,
        that such untrue statement or omission is contained in any information
        with respect to such Stockholder so furnished in writing by such
        Stockholder or its representative specifically for inclusion therein.
        In no event shall the liability of any selling holder of Registrable
        Securities hereunder be greater in amount than the dollar amount of
        the proceeds received by such holder upon the sale of the Registrable
        Securities giving rise to such indemnification obligation. The Company
        shall be entitled to receive indemnities from underwriters, selling
        brokers, dealer managers and similar securities industry professionals
        participating in the distribution, to the same extent as provided
        above with respect to information with respect to such persons or
        entities so furnished in writing by such persons or entities or their
        representatives specifically for inclusion in any Prospectus or
        Registration Statement.

               4.6.3.  Conduct of Indemnification Proceedings. Any person or
        entity entitled to indemnification hereunder will (i) give prompt
        written notice to the indemnifying party after the receipt by the
        indemnified party of a written notice of the commencement of any
        action, suit, proceeding or investigation or threat thereof made in
        writing for which such indemnified party will claim indemnification or
        contribution pursuant to this Agreement; provided, however, that the
        failure of any indemnified party to give notice as provided herein
        shall not relieve the indemnifying party of its obligations under
        Sections 4.6.1 and 4.6.2, except to the extent that the indemnifying
        party is actually prejudiced by such failure to give notice and (ii)
        unless in such indemnified party's reasonable judgment a conflict of
        interest may exist between such indemnified and indemnifying parties
        with respect to such claim, permit such indemnifying party to assume
        the defense of such claim with counsel reasonably satisfactory to the
        indemnified party. Whether or not such defense is assumed by the
        indemnifying party, the indemnifying party will not be subject to any
        liability for any settlement made without its consent (but such
        consent will not be unreasonably withheld). No indemnifying party will
        consent to the entry of any judgment or enter into any settlement that
        does not include as an unconditional term thereof the giving by the
        claimant or plaintiff. to such indemnified party of an unconditional
        release from all liability in respect of such claim or litigation. An
        indemnifying party who is not

                                     -23-
<PAGE>

        entitled to, or elects not to, assume the defense of a claim will not
        be obligated to pay the fees and expenses of more than one counsel in
        any one jurisdiction for all parties indemnified by such indemnifying
        party with respect to such claim, unless in the reasonable judgment of
        any indemnified party a conflict of interest may exist between such
        indemnified party and any other of such indemnified parties with
        respect to such claim, in which event the indemnifying party shall be
        obligated to pay the fees and expenses of such additional counsel or
        counsels.

               4.6.4.  Contribution. If for any reason the indemnification
        provided for in Sections 4.6.1 and 4.6.2 is unavailable to an
        indemnified party as contemplated by Sections 4.6.1 and 4.6.2, then
        the indemnifying party in lieu of indemnification shall contribute to
        the amount paid or payable by the indemnified party as a result of
        such expense, loss, claim, damage or liability. In determining the
        amount of contribution to which an indemnified party is entitled,
        there shall be considered such indemnified party's relative knowledge
        and access to information concerning the matter with respect to which
        the claim was asserted, the opportunity to correct and prevent any
        statement or omission, and other equitable considerations appropriate
        under the circumstances. It is hereby agreed that it would not
        necessarily be equitable if the amount of such contribution were
        determined by pro rata or per capita allocation. No person guilty of
        fraudulent misrepresentation (within the meaning of Section 11(f) of
        the Securities Act) shall be entitled to contribution from any Person
        who was not found guilty of such fraudulent misrepresentation.

        4.7.   Rule 144. The Company, agrees that at all times after it has
filed a registration statement pursuant to the requirements of the Securities
Act relating to any class of equity securities of the Company, it will file in
a timely manner all reports required to be filed by it pursuant to the
Securities Act and the Exchange Act and will take such further action as any
holder of Registrable Securities may reasonably request in order that such
holder may effect sales of Common Stock pursuant to Rule 144. At any
reasonable time and upon request of any Stockholder, the Company will furnish
such Stockholder and others with such information as may be necessary to
enable the Stockholder to effect sales of Common Stock pursuant to Rule 144
under the Securities Act and will deliver to such Stockholder a written
statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, the Company may deregister any class of its
equity securities under Section 12 of the Exchange Act or suspend its duty to
file reports with respect to any class of its securities pursuant to Section
15(d) of the Exchange Act if it is then permitted to do so pursuant to the
Exchange Act and the rules and regulations thereunder.

        4.8.   Participation in Underwritten Registrations. No Stockholder may
participate in any underwritten Registration hereunder unless such Stockholder
(i) agrees to sell its Registrable Securities on the basis provided in any
underwriting arrangements approved by the persons entitled hereunder to select
the underwriter pursuant to Sections 4.1.3 and 4.2.4, and (ii) accurately
completes in a timely manner and executes all questionnaires, powers of
attorney, underwriting agreements and other documents customarily required
under the terms of underwriting arrangements.

                                     -24-
<PAGE>

        4.9.   Other Registration Rights. The Company will not grant to any
person (including the Stockholders) any demand or piggyback registration
rights with respect to any capital stock of the Company including, without
limitation, the Shares other than piggyback registration rights that are not
inconsistent with the terms of this Section 4. To the extent that the Company
grants to any person registration rights with respect to any securities of the
Company having provisions more favorable to the holders thereof than the
provisions contained in this Agreement, the Company will confer comparable
rights to the holders of Registrable Securities under this Agreement.

        4.10.  Definition of Registrable Securities. "Registrable Securities"
means the shares of Common Stock now owned or hereafter acquired by any
Stockholder, but with respect to any share, only until such time as such share
(i) has been effectively registered under the Securities Act and disposed of
in accordance with the Registration Statement covering it or (ii) has been
sold to the public pursuant to Rule 144 (or any similar provision then in
force) under the Securities Act and the Legend referred to in Section 7.1 has
been removed from the certificate representing such share.

SECTION 5.     Governance.

        5.1.   Initial Board. On the date hereof, the initial Board of
Directors of the Company shall consist of the following members: Julian
Geiger, David Geltzer, John Mills, John D. Howard, Bodil M. Arlander and
Steven D. Tishman (collectively, the "Initial Directors") and three seats
shall be vacant. All Stockholders holding voting Common Stock agree to vote or
execute a written consent to effect the election of such Initial Directors to
take office immediately upon execution hereof.

        5.2.   Size and Composition of Board. Until amended in. accordance
with Section 5.6 below, the Company's Board of Directors shall at all times be
composed of no more than nine (9) directors, and the Company and each
Stockholder hereby agrees to take, at any time and from time to time, all
action necessary (including, without limitation, voting the shares of the
Company's voting Common Stock owned or controlled by such Stockholder, calling
special meetings of stockholders and executing and delivering written
consents) such that:

               5.2.1.  if and for so long as the Bear Stearns Parties
        collectively own 25,000 or more shares of voting Common Stock, five
        (5) members of the Board of Directors shall at all times be persons
        designated by holders of a majority of the voting Common Stock owned
        by the Bear Stearns Parties;

               5.2.2.  if and for so long as the Management Parties
        collectively own 15,000 or more shares of voting Common Stock, three
        (3) members of the Board of Directors shall at all times be persons
        designated by holders of a majority of the voting Common Stock owned
        by the Management Parties;

               5.2.3.  if and for so long as the Bear Stearns Parties have the
        right to appoint four or more members of the Board of Directors, in
        addition to any directors designated by the Bear Stearns Parties and
        the Management Parties, one (1) member of the Board of Directors shall
        at all times be a person who is not an employee, director or officer
        of the

                                     -25-
<PAGE>

        Bear Stearns Parties but shall be designated by holders of a majority
        of the voting Common Stock held by the Bear Stearns Parties subject to
        the approval of holders of a majority of the voting Common Stock owned
        by the Management Parties, such approval not to be unreasonably
        withheld or delayed;

               5.2.4.  if and for so long as the Bear Stearns Parties
        collectively own at least 20,000 shares of voting Common Stock, but
        less than 25,000 shares of voting Common Stock, four (4) members of
        the Board of Directors shall at all times be persons designated by
        holders of a majority of the voting Common Stock owned by the Bear
        Stearns Parties;

               5.2.5.  if and for so long as the Bear Stearns Parties
        collectively own at least 15,000 shares of voting Common Stock, but
        less than 20,000 shares of voting Common Stock, three (3) members of
        the Board of Directors shall at all times be persons designated by
        holders of a majority of the voting Common Stock owned by the Bear
        Stearns Parties;

               5.2.6.  if and for so long as the Bear Stearns Parties
        collectively own at least 10,000 shares of voting Common Stock but
        less than 15,000 shares of voting Common Stock, two (2) members of the
        Board of Directors shall at all times be persons designated by holders
        of a majority of the voting Common Stock owned by the Bear Stearns
        Parties;

               5.2.7.  if and for so long as the Management Parties
        collectively own at least 10,000 shares of voting Common Stock but
        less than 15,000 shares of voting Common Stock, two (2) members of the
        Board of Directors shall at all times be persons designated by holders
        of a majority of the voting Common Stock held by the Management
        Parties;

               5.2.8.  if and for so long as the Bear Stearns Parties do not
        otherwise have any rights to designate any member of the Board of
        Directors hereunder but the Bear Stearns Parties collectively own
        5,000 or more shares of voting Common Stock, one (1) member of the
        Board of Directors shall be a person designated by holders of a
        majority of the voting Common Stock owned by the Bear Stearns Parties.
        Notwithstanding the foregoing, the rights of the Bear Stearns Parties
        set forth in this Section 5.2.8 shall terminate upon the later to
        occur of. (i) the first Qualified Public Offering of Common Stock; and
        (ii) the rights of the Management Parties under Section 5.2.9
        terminating, irrespective of the number of shares of voting Common
        Stock then owned by the Bear Stearns Parties; and

               5.2.9.  if and for so long as the Management Parties do not
        otherwise have any rights to designate any member of the Board of
        Directors hereunder, but the Management Parties collectively own 5,000
        or more shares of voting Common Stock (including, for the purpose of
        this Section 5.2.9 only, voting Common Stock then owned by Management
        whether or not they are then employees of the Company), one (1) member
        of the Board of Directors shall be a person designated by holders of a
        majority of the voting Common Stock owned by the Management Parties
        (including voting Common Stock then owned by Management whether or not
        they are then employees of the Company). Notwithstanding the
        foregoing, the rights of the Management Parties set forth in this
        Section 5.2.9 shall terminate upon the occurrence of the first
        Qualified Public

                                     -26-
<PAGE>

        Offering of Common Stock, irrespective of the number of shares of
        voting Common Stock then owned by the Management Parties provided
        however that, if following such Qualified Public Offering Julian
        Geiger and his Related Parties (excluding any Shares owned by any
        other persons in any voting trust) collectively own 5,000 or more
        shares of voting Common Stock, and Mr. Geiger is the Chief Executive
        Officer of the Company, the rights of the Management Parties in this
        Section 5.2.9 shall not terminate until the earlier to occur of. (i)
        Mr. Geiger and such Related Parties collectively owning less than
        5,000 shares of voting Common Stock; and (ii) Mr. Geiger ceasing to be
        the Chief Executive Officer of the Company.

        The number of shares of Common Stock referred to in each Subsection of
this Section 5.2 and in Section 5.6 shall be adjusted as determined by the
Board of Directors upon any Stock Adjustment to reflect such Stock Adjustment.

        5.3.   Removal, Replacement. No director designated pursuant to
Section 5.2 may be removed except by the holders of a majority of the shares
of voting Common Stock entitled to nominate and appoint such director in
accordance with Section 5.2, and each Stockholder hereby agrees to take all
action necessary (including, without limitation, voting the shares of the
Company's voting Common Stock owned or controlled by such Stockholder, calling
special meetings of stockholders and executing and delivering written
consents) for the purpose of accomplishing the foregoing. Immediately upon any
Stockholder no longer being entitled to appoint one or more Director(s), such
Director(s) shall resign or be removed from the Board by the relevant
Stockholders. With respect to the vacancies on the Board of Directors
referenced in Section 5. 1, or if a vacancy on the Board occurs by reason of
the death, removal, resignation, retirement or election not to serve of a
designee, the remaining directors and the Company shall cause the vacancy
thereby created to be filled by a new designee as soon as possible, who is
designated in the manner and by the persons specified in Section 5.2 and the
Company and each Stockholder hereby agrees to take, at any time and from time
to time, all actions necessary to accomplish the same; provided, however, that
if any group fails to designate a representative in accordance with Section
5.2 above for a period of thirty (30) consecutive days, then such vacancy
shall be filled by a vote of all of the shareholders of the Company holding
voting Common Stock until such time as the board member is designated in
accordance with Section 5.2.

        5.4.   Insurance. In addition to any compensation to which the members
of the Board of Directors may be entitled, the Company shall obtain and
maintain at all during which this Agreement remains in effect, at the cost and
expense of the Company, director liability insurance policies covering each
member of the Board of Directors. Such director liability insurance policies
shall be provided by a reputable nationally recognized insurance carrier and
shall provide coverage in such amounts and on such terms as may be reasonably
acceptable to each member of the Board of Directors.

        5.5.   Board Approvals. In addition to any vote or consent of the
Board of Directors or the stockholders of the Company required by law or the
Amended and Restated Certificate of Incorporation, the affirmative vote of a
majority of the members of the Board of Directors shall be necessary for
authorizing, effecting or validating:

                                     -27-
<PAGE>

               (i)     the approval of any annual budget or business plan for
        the Company or any Subsidiary of the Company or the deviation by the
        Company or any such Subsidiary from any annual budget for the Company
        or such Subsidiary approved by the Board of Directors by more than ten
        percent (10%);

               (ii)    any capital expenditure or expenditures by the Company
        or any Subsidiary of the Company which, individually or in the
        aggregate, exceeds $250,000 except for any such capital expenditures
        which are identified and approved in the annual budget referred to in
        (i) above;

               (iii)   the hiring or termination by the Company or any
        Subsidiary of the Company of any officer or senior management employee
        of the Company or such Subsidiary or any material change in the terms
        of employment (including compensation) of any of the foregoing;

               (iv)    redemption, purchase, or other acquisition of any
        capital stock of the Company other than pursuant to an employment
        agreement with Management;

               (v)     authorization or issuance of any equity security;

               (vi)    any amendment, modification or repeal of the Company's
        Amended and Restated Certificate of Incorporation;

               (vii)   any merger or consolidation of the Company into or with
        another corporation, or any sale, lease, exchange, or other conveyance
        of all or substantially all the assets of the Company;

               (viii)  declaration or distribution of any dividend on any
        series of capital stock of the Company other than dividends on the
        Series A or Series B Preferred Stock;

               (ix)    increase in the number of shares that the Company is
        authorized to issue under the Stock Option Plan or establishment of or
        increase in the number of shares that the Company is authorized to
        issue under any similar or successor plan or any restricted stock,
        stock option or similar plan; or

               (x)     any transaction, contract, agreement, loan, advance
        (other than ordinary business expenses) or guarantee ("Transaction")
        entered into by the Company or any of its Subsidiaries with or for the
        benefit of the Management Parties or any Federated Stockholder or any
        of their respective Related Parties except for Transactions entered
        into with Federated pursuant to the Sourcing Agreement between
        Federated and the Company dated as of July 31, 1998, as the same may
        be amended from time to time.

        5.6.   Certain Approvals. In addition to any vote or consent of the
Board of Directors or the stockholders of the Company or required by law or
the Amended and Restated Certificate of Incorporation, until the Bear Stearns
Parties own less than 25,000 shares of voting Common Stock (adjusted as
described in Section 5.2) the affirmative vote of a majority of the members of
the Board of Directors, including, the affirmative vote of a director of the
Company designated by the Bear Stearns Parties and the affirmative vote of a
director of the Company designated by

                                     -28-
<PAGE>

the Management Parties (who shall be Julian Geiger if he is then a director of
the Company) in the case of (i) below and the affirmative vote of an
independent director appointed pursuant to Section 5.2.3 (if any) in the case
of (ii), (iii), (iv) or (v), shall be necessary for authorizing, effecting or
validating:

               (i)     any increase or decrease in the size of the Board of
        Directors (other than as described in Section 5.9 below);

               (ii)    any redemption or repurchase by the Company of any
        Common Stock held by the Bear Stearns Stockholders;

               (iii)   any redemption or repurchase by the Company of, or
        payment of dividends on, any shares of Series B Preferred Stock held
        by the Bear Stearns Stockholders in circumstances where redemption,
        repurchase or such payment of dividends is not permitted by the
        Company's Amended and Restated Certificate of Incorporation (as the
        same may be amended from time to time). It is expressly agreed that
        neither (a) payment of accrued dividends on the Series B Preferred
        Stock nor (b) redemption or repurchase of any shares of Series B
        Preferred Stock following any election by the Series B Majority
        Holders to demand redemption of any shares of Series B Preferred Stock
        pursuant to the Amended and Restated Certificate of Incorporation of
        the Company shall require any consent hereunder,

               (iv)    any Transaction, entered into by the Company or any of
        its Subsidiaries, with or for the benefit of any Bear Stearns
        Stockholder or any Related Party of any Bear Stearns Stockholder
        unless: (a) such Transaction is on terms no less favorable to the
        Company or the relevant Subsidiary than those that would have been
        obtained in a comparable transaction by the Company or such Subsidiary
        with an unrelated Person; or (b) such Transaction is pursuant to the
        Management Services Agreement between the Company and Bear Stearns
        dated as of the date hereof as the same may be amended from time to
        time (the "Management Services Agreement"); or

               (v)     any material amendment to the Management Services
        Agreement.

        This Section 5.6 shall terminate on the earlier to occur of. (a) Bear
Stearns ceasing to own 25,000 or more shares of voting Common Stock (adjusted
as described in Section 5.2), and (b) the Management Parties ceasing to have
the right to designate one or more members of the Board of Directors of the
Company under Section 5.2.

        5.7.   Board Meetings. From the date hereof until the first (1st)
anniversary of this Agreement, the Board of Directors shall hold regularly
scheduled meetings no less frequently than on a monthly basis. Thereafter, the
frequency of such meetings shall be determined by majority vote of the Board
of Directors; provided, however, that during the term of this Agreement
regularly scheduled meetings of the Board of Directors shall be held no less
frequently than once per calendar quarter.

        5.8.   Amended and Restated Certificate of Incorporation and By-Laws.
Promptly following Closing, the Stockholders agree to adopt such amendments to
the Company's Amended and Restated Certificate of Incorporation and By-Laws as
are, in the opinion of a

                                     -29-
<PAGE>

majority of the Board of Directors, reasonably necessary to give effect to the
provisions of this Section 5.

        5.9.   Public Offering. In connection with any public offering of
Shares, or the listing of Shares on any national securities exchange or
NASDAQ, the Board of Directors shall vote to increase the size of the Board of
Directors to permit the appointment of two independent directors of the
Company and, if the Bear Stearns Parties then own 25,000 or more shares of
Common Stock, the number of members of the Board of Directors which may be
designated by the Bear Stearns Parties pursuant to Section 5.2.1 shall be
increased to such number as would give the Bear Stearns Parties the right to
designate a majority of the members of the Board of Directors following the
appointment of independent directors pursuant to this Section 5.9.

SECTION 6.     Termination.

        The provisions of Sections 2 and 3 of this Agreement shall terminate
upon the earlier of (i) the consummation of the first underwritten Qualified
Public Offering of Common Stock in which the Company has received net proceeds
of at least $20 million (measured as of the date of issuance) and (ii) the
consummation of any Approved Sale.

SECTION 7.     Miscellaneous.

        7.1.   Legend. The certificates representing the capital stock of the
Company held by each of the Stockholders shall bear the following legend:

               "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
        REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF
        ANY STATE AND MAY NOT BE SOLD OR TRANSFERRED UNLESS THERE IS AN
        EFFECTIVE REGISTRATION STATEMENT COVERING SUCH SECURITIES OR SUCH SALE
        OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
        REQUIREMENTS OF SUCH ACT AND ANY SIMILAR REQUIREMENTS OF ANY
        APPLICABLE STATE SECURITIES LAW., THE SECURITIES REPRESENTED BY THIS
        CERTIFICATE ARE SUBJECT TO CERTAIN, RESTRICTIONS SET FORTH IN A
        STOCKHOLDERS AGREEMENT DATED AS OF AUGUST 3, 1998, A COPY OF WHICH IS
        AVAILABLE UPON REQUEST FROM THE SECRETARY OF THE COMPANY."

        If any capital stock of the Company becomes eligible for sale pursuant
to Rule 144(k) promulgated under the Securities Act, the Company shall, upon
the request of any holder of such capital stock, remove the legend set forth
in this Section 7.1 from the certificates evidencing the shares of such
capital sock held by such holder. In addition, (i) in connection with any
Transfer of shares of any capital stock of the Company pursuant to any public
offering registered under the Securities Act or pursuant to Rule 144 or Rule
144A (or any similar rule or rules then in effect promulgated under the
Securities Act) if such rule is available or (ii) if the holder of any shares
of capital stock of the Company delivers to the Company an opinion of counsel
reasonably acceptable to the Company that no subsequent Transfer of such
shares shall require

                                     -30-
<PAGE>

registration under the Securities Act, the Company shall promptly upon such
Transfer deliver new certificates for such shares which do not bear the legend
set forth in this Section 7.1.

        7.2.   Successors, Assigns and Transferees. This Agreement shall be
binding upon and inure to the benefit of the parties hereto, their respective
legal representatives, heirs, legatees, successors and assigns (including any
party to which any Stockholder has Transferred Shares if such party is
required under Section 2 to become bound hereby). The Company covenants and
agrees that it will not issue any equity securities to any person (other than
pursuant to an effective Registration Statement) unless such person, prior to
such issuance, agrees in writing to be bound by this Agreement, as amended or
modified prior to the date of such issuance, to the same extent and in the
same manner as the other parties hereto. Each such supplementary agreement
shall become effective upon its execution by the Company and such person
acquiring such equity securities, and it shall not require the signatures or
the consent of any other party hereto. Upon such execution such person shall
be bound by all the restrictions placed on the Stockholders by this Agreement
and all actions taken by the Stockholders and the Company pursuant to this
Agreement prior to the execution of such supplementary agreement, shall be
subject to any additional restrictions set forth in such supplementary
agreement and shall enjoy only such rights as are specifically set forth in
such supplementary agreement. Notwithstanding anything to the contrary set
forth herein, Shares sold to the public pursuant to an effective Registration
Statement shall no longer be subject to any of the provisions of this
Agreement.

        7.3.   Specific Performance, Etc. The Company and each Stockholder, in
addition to being entitled to exercise all rights provided herein, in the
Company's Amended and Restated Certificate of Incorporation or granted by law,
including recovery of damages, will be entitled to specific performance of its
rights under this Agreement. The Company agrees that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by it
of the provisions of this Agreement and hereby agrees to waive the defense in
any action for specific performance that a remedy at law would be adequate.

        7.4.   Governing Law. This Agreement shall be governed by and
construed in Accordance with the internal law of the State of New York.

        7.5.   Interpretation. The headings of the sections contained in this
Agreement are solely for the purpose of reference, are not part of the
agreement of the parties and shall not affect the meaning or interpretation of
this Agreement.

        7.6.   Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, or sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid. Any such notice shall be deemed
given when so delivered personally, telegraphed, telexed or sent by facsimile
transmission or, if mailed, three (3) business days after the date of deposit
in the United States mail, by certified mail return receipt requested, as
follows:

                                     -31-
<PAGE>

               7.6.1.  If to the Company to:

                       Specialty Acquisition Corporation
                       11 Penn Plaza, 6th Floor
                       New York, New York 10001
                       Attention: Julian R. Geiger
                       Facsimile No.: (212) 494-6818

                       with copies (which shall not constitute notice) to:

                       Kirkland & Ellis
                       655 15th Street N.W.
                       Washington, D.C. 20005
                       Attention: Richard L. Perkal, Esq.
                       Facsimile No.: (202) 879-5200

                       and to

                       Latham & Watkins
                       885 Third Avenue
                       Suite 1000
                       New York, N.Y. 10022-4100
                       Attention: Roger H. Kimmel, Esq.
                       Facsimile No.: (212) 751-4864

               7.6.2.  If to Bear Stearns, to:

                       MSS Acquisition Corp. II
                       c/o Bear, Stearns & Co. Inc.
                       245 Park Avenue, 17th Floor
                       New York, N.Y. 10167
                       Attention: John D. Howard
                       Facsimile No.: (212) 272-7425

                       with a copy (which shall not constitute notice) to:

                       Latham & Watkins
                       885 Third Avenue
                       Suite 1000
                       New York, N.Y. 10022-4100
                       Attention: Roger H. Kimmel, Esq.
                       Facsimile No.: (212) 751-4864

                                     -32-
<PAGE>

               7.6.3.  If to Federated, to:

                       c/o Federated Department Stores, Inc.
                       7 West Seventh Street
                       Cincinnati, Ohio 45202,
                       Attention: General Counsel
                       Facsimile No.: (513) 579-7354

                       with a copy (which shall not constitute notice) to:

                       Jones Day Reavis & Pogue
                       599 Lexington Avenue
                       New York, New York 10022
                       Attention: Robert A. Profusek, Esq.
                       Facsimile No.: (212) 755-7306

               7.6.4.  If to Management, to:

                       Specialty Acquisition Corporation
                       11 Penn Plaza, 6th Floor
                       New York, New York 10001
                       Attention: Julian R. Geiger
                       Facsimile No.: (212) 494-6818

                       with a copy (which shall not constitute notice) to:

                       Kirkland & Ellis
                       655 15th Street N.W.
                       Washington, D.C. 20005
                       Attention: Richard L. Perkal, Esq.
                       Facsimile No.: (202) 879-5200

        7.7.   Inspection and Compliance with Law. Copies of this Agreement
will be available for inspection or copying by any Stockholder at the offices
of the Company through the Secretary of the Company.

        7.8.   Amendments and Waivers. The provisions of this Agreement,
including the provisions of this Section 7.8, may not be amended, modified or
supplemented, and waivers of or consents to departures from the provisions
-hereof may not be given, except by a written instrument executed by (i) the
Company, (ii) the holders of a majority of the Bear Stearns Shares and (iii)
the holders of a majority of the Management Shares; provided that no
authorization, modification, supplement, waiver, consent or departure from the
provisions hereof which adversely affects the rights or obligations of the
Federated Stockholders, in their capacity as Stockholders, shall be given
without the additional prior written consent of holders of a majority of the
Federated Shares. No action taken pursuant to this Agreement, including,
without limitation, any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action. The waiver by
any party hereto of a breach of any provision of this Agreement shall not
operate or be construed as waiver of any preceding or succeeding

                                     -33-
<PAGE>

breach and no failure by any party to exercise any right or privilege
hereunder shall be deemed a waiver of such party's rights or privileges
hereunder or shall be deemed a waiver of such party's rights to exercise the
same at any subsequent time or times hereunder.

        7.9.   Transfers Void. Any Transfer of any security of the Company in
violation of this Agreement shall be null and void and the Company covenants
and agrees that it will not register or otherwise recognize a Transfer
(whether for the purposes of shareholder voting or in connection with the
distribution of dividends or other corporate assets) of any securities which
it has reason to believe was effected in violation of this Agreement.

        7.10.  Counterparts. This Agreement may be executed in one or more
counterparts, by the original parties hereto and any successor in interest,
each of which shall be deemed to be an original and all of which together
shall be deemed to constitute one and the same agreement.

        7.11.  Attorneys' Fees. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision hereof is validly
asserted as a defense, the successful party shall be entitled to recover
reasonable attorneys' fees in addition to, any other available remedy.

        7.12.  Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances,
is held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any
way impaired thereby.

        7.13.  Federated. Notwithstanding that Federated is a "Stockholder"
for the purposes of being subject to this Agreement, Federated shall not be
deemed to hold or own any shares of Common Stock subject to the Federated
Option until Federated has exercised the Federated Option in respect of such
shares of Common Stock in accordance with the terms of the Federated Option,
including without limitation, paying the Option Price for such shares of
Common Stock.

        7.14.  Redesignation of Voting Common Stock. Promptly following the
date hereof, the parties shall take such action necessary to create a class of
Common Stock of the Company having the same rights, powers and restrictions as
the voting Common Stock of the Company but which shall not, until the
consummation of a Qualified Public Offering, have the right to vote on any
matters to be voted on by the stockholders of the Company. All of the Shares
issuable pursuant to the Stock Option Plan shall be such non-voting Common
Stock and any shares of voting Common Stock (or options exercisable for voting
Common Stock) issued prior to the creation of the non-voting Common Stock
under the Stock Option Plan shall be exchanged for shares (or options
exercisable for shares) of non-voting Common Stock. Each Stockholder shall, in
addition, have the right, exerciseable by such Stockholder at its discretion,
to require that the Company exchange some or all of the Common Stock then held
by it respectively for such non-voting Common Stock.

        7.15.  DeBartolo. Bear Stearns shall ensure that any shares of Common
Stock Transferred by it to DeBartolo shall either be shares of non-voting
Common Stock or shall be

                                     -34-
<PAGE>

subject to an arrangement whereby Bear Stearns can exercise the votes of such
shares of Common Stock prior to the first Qualified Public Offering of Common
Stock.

                                     -35-
<PAGE>

        IN WITNESS WHEREOF, the parties have executed this Stockholder
Agreement as of the date first above written.

                             MSS-DELAWARE, INC.,
                             a Delaware corporation

                             By:     /s/ Julian Geiger
                                    -------------------------------------
                             Its:    President
                                    -------------------------------------

                             MSS ACQUISITION CORP. II,
                             a Delaware corporation

                             By:     /s/ John Howard
                                    -------------------------------------
                             Its:    President
                                    -------------------------------------

                             FEDERATED SPECIALTY STORES, INC.,
                             a Delaware corporation

                             By:     /s/ Denis J. Broderick
                                    -------------------------------------
                             Its:    Vice-President
                                    -------------------------------------

                             JULIAN R. GEIGER

                              /s/ Julian R. Geiger
                             -----------------------

                             DAVID R. GELTZER

                              /s/ David Geltzer
                             -----------------------

                             JOHN S. MILLS

                              /s/ John Mills
                             -----------------------<PAGE>
                                                                Exhibit 10.1

                           THE 1998 STOCK OPTION PLAN

                                       OF

                              MSS - DELAWARE, INC.

            MSS - Delaware, Inc., a Delaware corporation, has adopted The
1998 Stock Option Plan of MSS-Delaware., Inc. (the "Plan"), effective
August 3, 1998, for the benefit of its eligible Employees and Consultants.

            The purposes of the Plan are as follows:

            (1) To provide an additional incentive for Employees and Consultants
(as such terms are defined below) to further the growth, development and
financial success of the Company by personally benefiting through the ownership
of Company stock.

            (2) To enable the Company to obtain and retain the services of
Employees and Consultants considered essential to the long range success of the
Company by offering them an opportunity to own stock in the Company.

                                   ARTICLE I.
                                   DEFINITIONS

            Whenever the following terms are used in this Plan, they shall have
the meaning specified below unless the context clearly indicates to the
contrary. The singular pronoun shall include the plural where the context so
indicates.

      1.1.  Board.  "Board" shall mean the Board of Directors of the
Company.

      1.2.  Change in Control.  "Change in Control" shall mean a change in
ownership or control of the Company effected through any of the following
transactions:

            (a) any person or related group of persons (other than the Company
      or a Principal Stockholder or a person that, prior to such transaction,
      directly or indirectly controls, is controlled by, or is under common
      control with, the Company or a Principal Stockholder) directly or
      indirectly acquires beneficial ownership (within the meaning of Rule 13d-3
      under the Exchange Act) of securities possessing more than fifty percent
      (50%) of the total combined voting power of the Company's outstanding
      securities pursuant to a tender or exchange offer made directly to the
      Company's stockholders which the Board does not recommend such
      stockholders to accept; or

            (b) there is a change in the composition of the Board over a period
      of thirty-six (36) consecutive months (or less) such that a majority of
      the Board members (rounded up to the nearest whole number) ceases, by
      reason of one or more proxy contests for the election of Board members, to
      be comprised of individuals who either (i) have been Board members
      continuously since the beginning of such period or (ii) have been elected
      or nominated for election as Board members during such period by at least
      a majority of
<PAGE>
                                                                Exhibit 10.1

      the Board members described in clause (j)who were still in office at the
      time such election or nomination was approved by the Board; or

            (c) the stockholders of the Company approve a merger or
      consolidation of the Company with any other corporation (or other entity),
      other than a merger or consolidation which would result in the voting
      securities of the Company outstanding immediately prior thereto continuing
      to represent (either by remaining outstanding or by being converted into
      voting securities of the surviving entity) at least a majority of the
      combined voting power of the voting securities of the Company or such
      surviving entity outstanding immediately after such merger or
      consolidation; provided, however, that a merger or consolidation effected
      to implement a recapitalization of the Company (or similar transaction) in
      which no person (other than the Company or a Principal Stockholder or a
      person that, prior to such transaction, directly or indirectly controls,
      is controlled by, or is under common control with, the Company or a
      Principal Stockholder) acquires more than 25% of the combined voting power
      of the Company's then outstanding securities shall not constitute a Change
      in Control; or

            (d) the stockholders of the Company approve a plan of complete
      liquidation of the Company or an agreement for the sale or disposition by
      the Company of all or substantially all of the Company's assets; or

            (e) any person (other than the Company or a Principal Stockholder or
      a person that, prior to such transaction, directly or indirectly controls,
      is controlled by, or is under common control with, the Company or a
      Municipal Stockholder) is or becomes the beneficial owner of securities of
      the Company representing ten percent (10%) or more of the combined voting
      power of the Company's then outstanding securities and (A) the identity of
      the Chief Executive Officer of the Company is changed during the period
      beginning sixty (60) days before the attainment of the ten percent (10%)
      beneficial owner-ship and ending two (2) years thereafter, or (B)
      individuals constituting at least one-third (1/3) of the members of the
      Board at the beginning of such period shall leave the Board during the
      period beginning sixty (60) days before the attainment of the ten percent
      (10%) beneficial ownership and ending two (2) years thereafter.

      1.3.  Code.  "Code" shall mean the Internal Revenue Code of 1986, as
amended.

      1.4.  Committee.  "Committee" shall mean the Compensation Committee
of the Board, or another committee or subcommittee of the Board, appointed
as provided in Section 7 1.

      1.5.  Common Stock.  "Common Stock" shall mean the common stock of
the Company, par value $O.01 per share.

      1.6.  Company.  "Company" shall mean MSS-Delaware, a Delaware
corporation.

      1.7.  Consultant. "Consultant" shall mean any consultant or adviser
if:

            (a)   the consultant or adviser renders bona fide services to
      the Company;

                                       2
<PAGE>
                                                                Exhibit 10.1

            (b) the services rendered by the consultant or adviser are not in
      connection with the offer or sale of securities in a capital -raising
      transaction and do not directly or indirectly promote or maintain a market
      for the Company's securities; and

            (c) the consultant or adviser is a natural person who has contracted
      directly with the Company to render such services.

      1.8.  Director.  "Director" shall mean a member of the Board.

      1.9.  Disinterested Director.  "Disinterested Director" shall mean a
Director who is a "disinterested person" as defined in Rule l6b-3 of the
Exchange Act.

      1.10. DRO.  "DRO" shall mean a domestic relations order as defined
by the Code or Title I of the Employee Retirement Income Security Act of
1974, as amended, or the rules thereunder.

      1.11. Employee.  "Employee" shall mean any officer or other employee
(as defined in accordance with Section 3401(c) of the Code) of the
Company, or of any corporation which is a Subsidiary.

      1.12. Exchange Act.  "Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended.

      1.13. Fair Market Value. "Fair Market Value- of a share of Common Stock as
of a given date shall be determined on a fully diluted basis (a) if such stock
has first become publicly traded on such date, the mean between the final bid
and asked prices on the principal exchange (or NASDAQ if applicable) on which
such shares me traded on such date as reported in the Wall Street Journal, (b)
if such stock was publicly traded prior to such date, 20 trading days (or such
smaller number of days as follow the day prior to the day on which such stock
was first publicly traded) prior to the date of determination of the mean
between the final bid and asked prices on the principal exchange (or NASDAQ if
applicable) on which such shares are traded as reported in the Wall Street
Journal, or (c) if Common Stock is not publicly traded on an exchange and not
quoted on NASDAQ or a successor quotation system, the Fair Market Value of a
share of Common Stock as established by the Committee acting in good faith.

      1.14. Incentive Stock Option.  "Incentive Stock Option" shall mean
an Option which conforms to the applicable provisions of Section 422 of
the Code and which is designated as an Incentive Stock Option by the
Committee.

      1.15. IPO.  IPO shall mean the first public offering by the Company
of its Common Stock.

      1.16. Non-Qualified Stock Option.  "Non-Qualified Stock Option"
shall mean an Option which is not designated as an Incentive Stock Option
by the Committee.

      1.17. Optionee.  "Option" shall mean a person who has been granted
an Option.

      1.18. Option.  "Option" shall mean a stock Option granted under
Article IV of the Plan.

                                       3
<PAGE>
                                                                Exhibit 10.1

An Option granted under the Plan shall, as determined by the Committee, be
either a Non-Qualified Stock Option or Incentive Stock Option; provided,
however, that Options granted to Consultants shall be Non-Qualified Stock
Options.

      1.19. Plan.  "Plan" shall mean The 1998 Stock Option Plan of
MSS-Delaware.

      1.20. Principal Stockholder.  "Principal Stockholder" shall mean MSS
Acquisition Corp. II, Julian R. Geiger, David R. Geltzer, John S. Mills.

      1.21. Securities Act. "Securities Act" shall mean the Securities Act
of 1933, as amended.

      1.22. Stock Option Agreement. "Stock Option Agreement" shall mean a
written agreement executed by an authorized officer of the Company and the
Option which shall contain such terms and conditions with respect to an Option
as the Committee shall determine, consistent with the Plan.

      1.23. Subsidiary.  "Subsidiary" shall mean any entity of which the
Company owns, directly or indirectly, 50% or more of the aggregate voting
power of the voting securities.

      1.24. Substitute Option. "Substitute Option" shall mean an Option granted
under this Plan upon the assumption of, or substitution for, outstanding equity
options previously granted by a company or other entity in connection with a
corporate transaction, such as a merger, combination, consolidation or
acquisition of property or stock; provided, however, that in no event shall the
term "Substitute Option" be construed to refer to an Option made in connection
with the cancellation and repricing of an Option granted under the Plan.

      1.25. Termination of Consultancy. "Termination of Constancy" shall mean
the time when the engagement of an Optionee as a Consultant to the Company or a
Subsidiary is terminated for any reason, with or without cause, including, but
not by way of limitation, by resignation, discharge, death or retirement; but
excluding terminations where there is a simultaneous commencement of employment
with the Company or any Subsidiary. The Committee. in its sole discretion, shall
determine the effect of all matters and questions relating to Termination of
Consultancy, including, but not by way of limitation, the question of whether a
Termination of Consultancy resulted from a discharge for good cause, and all
questions of whether a particular leave of absence constitutes a Termination of
Consultancy. Notwithstanding any other provision of the Plan, the Company or any
Subsidiary has an absolute and unrestricted right to terminate a Consultant's
service at any time for any reason whatsoever, with or without cause, except to
the extent expressly provided otherwise in writing.

      1.26. Termination of Employment. "Termination of Employment" shall mean
the time when the employee-employer relationship between an Optionee and the
Company or any Subsidiary is terminated for any reason, with or without cause,
including. but not by way of limitation, a termination by resignation,
discharge, death, disability or retirement; but excluding (a) terminations where
there is a simultaneous reemployment or continuing employment of an Optionee by
the Company or any Subsidiary, (b) at the discretion of the Committee,
terminations which result in a temporary severance of the employee-employer
relationship, and (c) at the discretion of the Committee, terminations which are
followed by the simultaneous establishment of a consulting relationship by the
Company or a Subsidiary with the former employee.

                                       4
<PAGE>
                                                                Exhibit 10.1

The Committee, in its sole discretion, shall determine the effect of all matters
and questions relating to Termination of Employment, including, but not by way
of limitation, the question of whether a Termination of Employment resulted from
a discharge for good cause, and all questions of whether a particular leave of
absence constitutes a Termination of Employment; provided, however , that, with
respect to Incentive Stock Options, unless otherwise determined by the Committee
in its discretion, a leave of absence, change in status from an employee to an
independent contractor or other change in the employee-employer -relationship
shall constitute a Termination of Employment if and to the extent that such
leave of absence, change in status or other change interrupts employment for the
purposes of Section 422(a)(2) of the Code and the then applicable regulations
and revenue rulings under said Section.

                                   ARTICLE II.
                             SHARES SUBJECT TO PLAN

      2.1. Shares Subject to Plan. The shares of stock subject to Options shall
be shares of the Company's Common Stock, par value $0.01 per share. The
aggregate number of such shares which may be issued upon exercise of such
Options shall not exceed 17,500.

      2.2. Add-back of Options. If any Option expires or is canceled without
having been fully exercised, or is exercised in whole or in part for cash as
permitted by the Plan, the number of shares subject to such Option but as to
which such Option was not exercised prior to its expiration, cancellation or
exercise may again be granted hereunder, subject to the limitations of Section
2.1. Furthermore, any shares subject to Options which are adjusted pursuant to
Section 8.3 and become exercisable with respect to shares of stock of another
corporation shall be considered canceled and may again be granted hereunder,
subject to the limitations of Section 2.1. Shares of Common Stock which are
delivered by the Optionee or withheld by the Company upon the exercise of any
Option under the Plan, in payment of the exercise price thereof or tax
withholding thereon, may again be granted hereunder, subject to the limitations
of Section 2.1. Notwithstanding the provisions of this Section 2.2, no shares of
Common Stock may again be granted if such action would cause an Incentive Stock
Option to fail to qualify as an "incentive stock option" under Section 422 of
the Code.

                                  ARTICLE III.
                               GRANTING OF OPTIONS

      3.1.  Stock Option Agreement.  Each Option shall be evidenced by a
written Stock Option Agreement.  Stock Option Agreements evidencing
Incentive Stock Options shall contain such terms and conditions as may be
necessary to meet the applicable provisions of Section 422 of the Code.

      3.2. At-Will Employment. Nothing in the Plan or in any Stock Option
Agreement hereunder shall confer upon any Optionee any right to continue in the
employ of or as a Consultant for, the Company or any Subsidiary, or shall
interfere with or restrict in any way the rights of the Company and any
Subsidiary, which arc hereby expressly reserved, to discharge any Optionee at
any time for any reason whatsoever, with or without cause, except to the extent

                                       5
<PAGE>
                                                                Exhibit 10.1

expressly provided otherwise in a written employment agreement between the
Optionee and the Company or any Subsidiary.

                                   ARTICLE IV.
                               GRANTING OF OPTIONS

      4.1.  Eligibility.  Any Employee or Consultant selected by the
Committee pursuant to Section 4.4(a)(i) shall be eligible to be granted an
Option.

      4.2. Disqualification for Stock Ownership. No person may he granted an
Incentive Stock Option under the Plan if such person, at the time the Incentive
Stock Option is granted, owns stock possessing more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company or any
then existing Subsidiary or parent corporation (within the meaning of Section
422 of the Code) unless such Incentive Stock Option conforms to the applicable
provisions of Section 422 of the Code.

      4.3.  Qualification of Incentive Stock Options.  No Incentive Stock
Option shall be granted to any person who is not an Employee.

      4.4.  Granting of Options to Employees and Consultants.

            (a) The Committee shall from time to time, in its discretion, and
      subject to applicable limitations of the Plan:

                  (i) Select from among the Employees and Consultants (including
            Employees and Consultants who have previously received Options under
            the Plan) such or them as in its opinion should be granted Options;

                  (ii)  Determine the number of shares to bc subject to
            such Options granted to the selected Employees and Consultants;

                  (iii) Subject to Section 4.3, determine whether such Options
            are to be Incentive Stock Options or Non-Qualified Stock Options;
            and

                  (iv)  Determine the terms and conditions of such
            Options, consistent with the Plan.

            (b) Upon the selection of an Employee or Consultant to be granted an
      Option, the Committee shall instruct the Secretary of the Company to issue
      the Option and may impose such conditions on the grant of the Option as it
      deems appropriate.

            (c) Any Incentive Stock Option granted under the Plan may be
      modified by the Committee, with the consent of the Optionee, to disqualify
      such Option from treatment as an "incentive stock option" tinder Section
      422 of the Code.

                                       6
<PAGE>
                                                              Exhibit 10.1

                                   ARTICLE V.
                                TERMS OF OPTIONS

      5.1. Option Price. The price per share of the shares subject to each
Option shall be set by the Committee; provided, however, that such price shall
be no less than the par value of a share of Common Stock, unless otherwise
permitted by applicable state law, and:

            (a) in the case of Incentive Stock Options such price shall not be
      less than 100% of the Fair Market Value of a share of Common Stock on the
      date the Option is granted (or the date the Option is modified, extended
      or renewed for purposes of Section 424(h) of the Code);

            (b) in the case of Incentive Stock Options granted to an individual
      then owning (within the meaning of Section 424(d) of the Code) more than
      10% of the total combined voting power of all classes of stock of the
      Company or any Subsidiary or parent corporation thereof (within the
      meaning of Section 422 of the Code), such price shall not be less than
      110% of the Fair Market Value of a share of Common Stock on the date the
      Option is granted (or the date the Option is modified, extended or renewed
      for purposes of Section 424(b) of the Code); and

            (c) in the case of an Option that is a Substitute Option, such price
      may be less than the Fair Market Value per share on the date of grant,
      provided, that the excess of:

                  (i) the aggregate Fair Market Value (as of the date such
            Substitute Option is granted) of the shares subject to the
            Substitute Option; over

                  (ii)  the aggregate exercise price of such Substitute
            Option; does not exceed the excess of,

                  (iii) the aggregate fair market value (as of the time
            immediately preceding the transaction giving rise to the Substitute
            Option, such fair market value to be determined by the Committee) of
            the shares of the predecessor entity that were subject to the grant
            assumed or substituted for by the Company; over

                  (iv)  the aggregate exercise price of the option on such
            shares.

      5.2. Option Term. The term of an Option shall be set by the Committee in
its discretion; provided, however, that, in the case of Incentive Stock Options,
the term shall not be more than ten (10) years from the date the Incentive Stock
Option is granted, or five (5) years from the date the Incentive Stock Option is
granted if the Incentive Stock Option is granted to an individual then owning
(within the meaning of Section 424(d) of the Code) more than 10% of the total
combined voting power of all classes of stock of the Company or any Subsidiary
or parent corporation thereof (within the meaning of Section 422 of the Code).
Except as limited by requirements of Section 422 of the Code and regulations and
rulings thereunder applicable to Incentive Stock Options, the Committee may
extend the term of any outstanding Option in connection with any Termination of
Employment or Termination of Consultancy of the Optionee, or amend any other
term or condition of such Option relating to such a termination.

                                       7

<PAGE>
                                                       Exhibit 10.1

     5.3. Option Vesting

         (a) The period during which an Option vests or becomes exercisable, in
     whole or in part, shall be set by the Committee and the Committee may
     determine that an Option may not be exercised in whole or in part for a
     specified period after it is granted; provided, however that, unless the
     Committee otherwise provides in the terms of the Stock Option Agreement or
     otherwise,  no Option shall be exercisable by any Optionee who is then
     subject to Section 16 of the Exchange Act within the period ending six
     months and one day after the date the Option is granted. At any time after
     grant of an Option, the Committee may, in its sole discretion and subject
     to whatever terms and conditions it selects, accelerate the period during
     which an Option vests.

         (b) No portion of an Option which is unexercisable at Termination of
     Employment or Termination of Consultancy, as applicable, shall thereafter
     become exercisable, except as may be otherwise provided by the Committee
     either in the Stock Option Agreement or by action of the Committee.

         (c) To the extent that the aggregate Fair Market Value of stock with
     respect to which "incentive stock options" (within the meaning of Section
     422 of the Code, but without regard to Section 422(d) of the Code) are
     exercisable for the first time by an Optionee during any calendar year
     (under the Plan and all other Incentive Stock Option plans of the Company
     and any parent or subsidiary corporation (within the meaning of Section 422
     of the Code) of the Company) exceeds $100,000, such Options shall be
     treated as Non-Qualified Options to the extent required by Section 422 of
     the Code. The rule set forth in the preceding sentence shall be applied by
     taking Options into account in the order in which they were granted. For
     purposes of this Section 5.3(c), the Fair Market Value of stock shall be
     determined as of the time the Option with respect to such stock is granted.

                                 ARTICLE VI.
                            EXERCISE OF OPTIONS

     6.1. Partial Exercise. An exercisable Option may be exercised in whole or
in part. However, an Option shall not be exercisable with respect to fractional
shares and the Committee may require that, by the terms of the Option, a partial
exercise be with respect to a minimum number of shares.

     6.2. Manner of Exercise. All or a portion of an exercisable Option shall be
deemed exercised upon delivery of all of the following to the Secretary of the
Company or his office.

         (a) A written notice complying with the applicable rules established by
     the Committee stating that the Option, or a portion thereof, is exercised.
     The notice shall be signed by the Optionee or other person then entitled to
     exercise the Option or such portion of the Option;

         (b) Such representations and documents as the Committee, in its sole
     discretion, deems necessary or advisable to effect compliance with all
     applicable provisions of the Securities Act and any other federal or state
     securities laws or

                                   8

<PAGE>

                                                                Exhibit 10.1

      regulations. The Committee may, in its sole discretion. also take whatever
      additional actions it deems appropriate to effect such compliance
      including, without limitation, placing legends on share certificates and
      issuing stop-transfer notices to agents and registrars;

            (c)   In the event that the Option shall be exercised pursuant
      to Section 8.1 by any person or persons other than the Optionee.
      appropriate proof of the right of such person or persons to exercise
      the Option; and

            (d) Fall cash payment to the Secretary of the Company for the shares
      with respect to which the Option, or portion thereof, is exercised.
      However, the Committee, may in its discretion (i) allow a delay in payment
      up to thirty (30) days from. the date the Option, or portion thereof, is
      exercised; (ii) allow payment, in whole or in part, through the delivery
      of shares of Common Stock which have been owned by the Optionee for at
      least six months, duly endorsed for transfer to the Company with a Fair
      Market Value on the date of delivery equal to the aggregate exercise price
      of the Option or exercised opinion thereof, (iii) allow payment, in whole
      or in part, through the surrender of shares of Common Stock then issuable
      upon exercise of the Option having a Fair Market Value on the date of
      Option exercise equal to the aggregate exercise price of the Option or
      exercised portion thereof; (iv) allow payment, in whole or in part,
      through the delivery of property of any kind which constitutes good and
      valuable consideration; (v) allow payment in whole or in part, through the
      delivery of a full recourse promissory note bearing interest (at no less
      than such rate as shall then preclude the imputation of interest under the
      Code) and payable upon such terms as may be prescribed by the Committee or
      the Board; (vi) allow payment, in whole or in part, through the delivery
      of a notice that the Optionee has placed a market sell order with a broker
      with respect to shares of Common Stock then issuable upon exercise of the
      Option, and that the broker has been directed to pay a sufficient portion
      of the net proceeds of the sale to the Company in satisfaction of the
      Option exercise price, provided that payment of such proceeds is then made
      to the Company upon settlement of such sale; or (vii) allow payment
      through any combination of the consideration provided in the foregoing
      subparagraphs (ii), (iii), (iv), (v) and (vi). In the case of a promissory
      note, the Committee may also prescribe the form of such note and the
      security to be given for such note. The Option may not be exercised,
      however, by delivery of a promissory note or by a loan from the Company
      when or where such loan or other extension of credit is prohibited by law.

      6.3. Conditions to Issuance of Stock Certificates. The Company shall not
be required to issue or deliver any certificate or certificates for shares of
stock purchased upon the exercise of any Option or portion thereof prior to
fulfillment of all of the following conditions:

            (a)   The admission of such sham to listing on all stock
      exchanges on which such class of stock is then listed;

            (b) The completion of any registration or other qualification of
      such shares under any state or federal law, or under the rulings or
      regulations of the Securities and Exchange Commission or any other
      governmental regulatory body which the Committee shall, in its sole
      discretion, deem necessary or advisable;

                                       9
<PAGE>
                                                                Exhibit 10.1

            (c) The obtaining of any approval or other clearance from any state
      or federal governmental agency which the Committee shall, in its sole
      discretion, determine to be necessary or advisable;

            (d) The lapse of such reasonable period of time following the
      exercise of the Option as the Committee may establish from time to time
      for reasons of administrative convenience, and

            (e) The receipt by the Company of M payment for such shares,
      including payment of any applicable withholding tax, which in the
      discretion of the Committee may be in the form of consideration used by
      the Optionee to pay for such shares under Section 6.2(d).

      6.4. Rights as Stockholders. Optionees shall not be, nor have any of the
rights or privileges of, stockholders of the Company in respect of any shares
purchasable upon the exercise of any part of an Option unless and until
certificates representing such shares have been issued by the Company to such
Optionees.

      6.5. Ownership and Transfer Restriction. The Committee, in its sole
discretion, may impose such restrictions on the ownership and transferability of
the shares purchasable upon the exercise of an Option as it deems appropriate.
Any such restriction shall be set forth in the respective Stock Option Agreement
and may be referred to on the certificates evidencing such shares. The Optionee
shall give the Company prompt notice of any disposition of shares of Common
Stock acquired by exercise of an Incentive Stock Option within (a) two years
from the date of granting (including the date the Option. is modified, extended
or renewed for purposes of Section 424(h) of the Code) such Option to such
Optionee or (b) one year after the transfer of such shares to such Optionee.

      6.6.  Additional Limitations on Exercise of Options.  Optionees may
be required to comply with any timing or other restrictions with respect
to the settlement or exercise of an Option, including a window-period
limitation, as may be imposed in the reasonable discretion of the
Committee.

                                  ARTICLE VII.
                                 ADMINISTRATION

      7.1. Compensation Committee. Prior to an IPO, the Compensation Committee
shall consist of the entire Board or a subcommittee of the Board assuming the
functions of the Committee under the Plan, provided that the Chief Executive
Officer of the Company shall be a member of the Compensation Committee. After an
IPO, the Board may elect to have only Disinterested Directors serve on the
Committee. Appointment of Committee members shall. be effective upon acceptance
of appointment. Committee members may resign at any time by delivering written
notice to the Board. Vacancies in the Committee may be filled by the Board.

      7.2. Duties and Powers of Committee. It shall be the duty of the Committee
to conduct. the general administration of the Plan in accordance with its
provisions. The Committee shall have the power to interpret the Plan and the
Stock Option Agreements, and to adopt such rules for the administration,
interpretation, and application of the Plan as are

                                       10
<PAGE>
                                                                Exhibit 10.1

consistent therewith, to interpret, amend or revoke any such rules and to amend
any Stock Option Agreement provided that the rights or obligations of the
Optionee of the Option that is the subject of any such Stock Option Agreement
are not affected adversely. Any such grant under the Plan need riot be the same
with respect to each Optionee. Any such interpretations and rules with respect
to Incentive Stock Options shall be consistent with the provisions of Section
42.2 of the Code. In its sole discretion, the Board may at any time and from
time to time exercise any and all rights and duties of the Committee under the
Plan.

      7.3.  Majority Rule, Unanimous Written Consent.  The Committee shall
act by a majority of its members in attendance at a meeting at which a
quorum is present or by a memorandum or other written instrument signed by
all members of the Committee.

      7.4. Compensation: Professional Assistance: Good Faith Actions. Members of
the Committee shall receive such compensation, if any, for their services as
members as may be determined by the Board. All reasonable expenses and
liabilities which members of the Committee incur in connection with the
administration of the Plan shall be borne by the Company, The Committee may,
with the approval of the Board, employ attorneys, consultants, accountants..
appraisers, brokers, or other persons. The Committee, the Company and the
Company's officers and Directors shall be entitled to rely in good faith upon
the ad,, ice, opinions or valuations of any such persons. All actions taken and
all interpretations and determinations made by the Committee or the Board in
good faith shall be final and binding upon all Optionees, the Company and all
other interested persons. No members of the Committee or Board shall be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan or Options, and all members of the Committee and
the Board shall be fully protected by the Company in respect of any such action,
determination of interpretation, so long as in each case such member was not
grossly negligent did not act in bad faith or with willful misconduct.

                                  ARTICLE VIII.
                            MISCELLANEOUS PROVISIONS

      8.1. Not Transferable. No Option under the Plan may be sold, pledged,
assigned or transferred in any manner other than by will or the laws of descent
and distribution or, subject to the consent of the Committee, pursuant to a DRO,
unless and until such Option has been exercised, or the: shares underlying such
Option have been issued. and all restrictions applicable to such shares have
lapsed. No Option or interest or right therein shall be liable for the debts,
contracts or engagements of the Optionee or his successors in interest or shall
be subject to disposition by transfer, alienation, anticipation, pledge,
encumbrance, assignment or any other means whether such disposition be voluntary
or involuntary or by operation of law by judgment, levy. attachment, garnishment
or any other legal or equitable proceedings (including bankruptcy), and any
attempted disposition thereof shall be null and void and of no effect, except to
the extent that such disposition is permitted by the preceding sentence.

            During the lifetime of the Optionee, only he may exercise an Option
(or any portion thereof) granted to him under the Plan, unless it has been
disposed of pursuant to a DRO. After the death of the Optionee, any exercisable
portion of an Option may, prior to the time when such portion becomes
unexercisable under the Plan or the applicable Stock Option Agreement,

                                       11
<PAGE>

                                                                Exhibit 10.1

be exercised by his personal representative or by any person empowered to do so
under the deceased Optionee's will or under the then applicable laws of descent
and distribution.

      8.2. Amendment, Suspension or Termination of the Plan. Except as otherwise
provided in this Section 8.2, the Plan may be wholly or partially ended or
otherwise modified, suspended or terminated at any time or from time to time by
the Board or the Committee. However, without approval of the Company's
stockholders given within twelve months before or after the action by the Board
or the Committee, no action of the Board or the Committee may, except as
provided in Section 8.3, increase the limits imposed in Section 2.1 on the
maximum number of shares which may be issued under the Plan. No amendment,
suspension or termination of the Plan shall, without the consent of the Optionee
alter or impair any rights or obligations under any Option theretofore granted,
unless the Option itself otherwise expressly so provides. No Options may be
granted during any period of suspension or after termination of the Plan, and in
no event may any Incentive Stock Option be granted under the Plan after the
first to occur of the following events:

            (a)   The expiration of ten years from the date the Plan is
      adopted by the Board, or

            (b) The expiration of ten years from the date the Plan is approved
      by the Company s stockholders under Section 8.4.

      8.3.  Changes in Common Stock or Assets of the Company Acquisition
or Liquidation of the Company, Change in Control and Other Corporate
Events.

            (a) Subject to Section 8.3(c), in the event that the Committee
      determines that any merger. consolidation, recapitalization,
      reorganization, reincorporation-stock split, reverse stock split, stock
      dividend, combination or reclassification of the Company's capital stock
      or other similar corporate transaction or event affects the Common Stock
      appropriate in such that an adjustment is reasonably determined by the
      Committee to be i order to prevent dilution or enlargement of the benefits
      or potential benefits intended to be made available under the Plan or with
      respect to an Option, then the Committee shall, in such mariner as it may
      reasonably deem equitable, adjust any or all of:

                  (i) the number and kind of shares of Common Stock (or other
            securities or property) with respect to which Options may be granted
            (including, but not limited to, adjustments of the limitations in
            Section 2.1 on the maximum number and kind of shares which may be
            issued),

                  (ii)  the number and kind of shares of Common Stock (or
            other securities or property) subject to outstanding Options,
            and

                  (iii) the exercise price with respect to any Option.

            (b) In the event of any Change in Control or other transaction or
      event described in Section 8.3(a), or of changes in applicable laws,
      regulations, or accounting principles, the Committee, ;in its sole
      discretion, and on such terms and conditions as it deems appropriate,
      either by the terms of the Option or by action taken prior to the

                                       12
<PAGE>

                                                                Exhibit 10.1

      occurrence of such transaction or event and either automatically or upon
      the Option's request, is hereby authorized to take any one or more of the
      following actions whenever the Committee determines that such action is
      appropriate in order to prevent dilution or enlargement of the benefits or
      potential benefits intended to be made available under the Plan or with
      respect to any Option under the Plan, to facilitate such transactions or
      events or to give effect to such changes in laws, regulations or
      principles:

                  (i) To provide for the purchase of any such Option for an
            amount of cash equal to the amount that could have been attained
            upon the exercise of such Option had such Option been currently
            exercisable or payable or fully vested;

                  (ii) To provide that the Option cannot vest or be exercised
            after such event. provided that prior to such event such Option
            shall be exercisable as to all shares covered thereby,
            notwithstanding anything to the contrary in (A) Section 5.31, or (B)
            the provisions of such Option;

                  (iii) To provide that such Option be assumed by the successor
            or survivor corporation, or a parent or subsidiary thereof, or shall
            be substituted for by similar options covering the stock of the
            successor or survivor corporation, or a parent or subsidiary
            thereof, with appropriate adjustment; as to the number and kind of
            shares and prices; and

                  (iv) To make adjustments in the number and type of shares of
            Common Stock (or other securities or property) subject to
            outstanding Options, and in the exercise price thereof which the
            Committee shall reasonably deem appropriate,

            (c) No adjustment or action described in this Section 8.3 or in any
      other provision of the Plan shall be authorized to the extent that such
      adjustment or action would cause the Plan to violate Section 422(b)(1) of
      the Code. Furthermore, no such adjustment or action shall be authorized to
      the extent such adjustment or action would result in short-swing profits
      liability under Section 16 or violate the exemptive conditions of Rule
      16b-3 of the Exchange Act unless the Committee determines that the Option
      is not to comply with such exemptive conditions. The number of shares of
      Common Stock subject to any Option shall always be rounded to the next
      whole number.

      8.4. Approval of Plan by Stockholders. The Plan will be submitted for the
approval of the Company's stockholders within twelve months after the date of
the Board's initial adoption of the Plan. Options may be granted prior to such
stockholder approval, provided that such Options shall not be exercisable nor
shall such Options vest prior to the time when the Plan is approved by the
stockholders, and provided further that if such approval has not been obtained
at the end of said twelve-month period, all Options previously granted under the
Plan shall thereupon be canceled and become null and void.

      8.5. Tax Withholding. The Company shall be entitled to require payment in
cash or deduction from other compensation payable to each Optionee of any sums
required by federal. or local tax law to be withheld with respect to the
issuance, vesting, exercise or payment of any Option. The Committee may in its
discretion and in satisfaction of the foregoing requirement

                                       13
<PAGE>

                                                                Exhibit 10.1

allow such Optionee to elect to have the Company withhold shares of Common Stock
otherwise issuable under such Option (or allow the return of shares of Common
Stock) having a Fair Market Value equal to the sums required to be withheld.

      8.6.  Loans.  The Committee may, in its discretion, extend one or
more loans to Optionee in connection with the exercise of an Option
granted under the Plan.  The terms and conditions of any such loan shall
be set by the Committee.

      8.7. Forfeiture Provisions. Pursuant to its general authority to determine
the terms and conditions applicable to Options under the Plan, the Committee
shall have the right to provide, in the terms of Options granted under the Plan,
or to require an Optionee to agree by separate written instrument, that (a) (i)
any proceeds, gains or other economic benefit actually or constructively
received by the Optionee upon any receipt or exercise of the Option, or upon the
receipt or resale of any Common Stock underlying the Option, must be paid to the
Company, and (ii) the Option shall terminate and any unexercised portion of the
Option (whether or not vested) shall be forfeited, if (b)(i) a Termination of
Employment or Termination of Consultancy occurs prior to a specified date, or
within a specified time period following receipt or exercise of the Option, or
(ii) the Optionee at any time, or during a specified time period, engages in any
activity in competition with the Company, or which is inimical, contrary or
harmful to the interests of the Company, as further defined by the Committee or
the Optionee incurs a Termination of Employment or Termination of Consultancy
for cause.

      8.8. Effect of Plan Upon Option and Compensation Plans. The adoption of
the Plan shall not affect any other compensation or incentive plans in effect
for the Company or any Subsidiary. Nothing in the Plan shall be con-trued to
limit the right of the Company (a) to establish any other form, of incentives or
compensation for Employees, Directors or Consultants of the Company or any
Subsidiary or (b) to grant or assume options otherwise that under the Plan in
connection with any proper corporate purpose including but not by way of
limitation, the grant or assumption of options in connection with the
acquisition by purchase, lease, merger, consolidation or otherwise, of the
business, stock or assets of any corporation, partnership, limited liability
company, firm or association.

      8.9. Compliance with Laws. The Plan, the granting and vesting of Options
under the Plan and the issuance and delivery of shares of Common Stock and the
payment of money under the Plan or under Options granted hereunder are subject
to compliance with all applicable federal and state laws, rules and regulations
(including but not limited to suite and federal securities law and federal
margin requirements) and to such approvals by any listing, regulatory or
government authority as may. in the opinion of counsel for the Company, be
necessary or advisable in connection therewith. Any securities delivered under
the Plan shall be subject to such restrictions, and the person acquiring such
securities shall, if requested by the Company, provide such assurances and
representations to the Company as the Company may deem necessary or desirable to
assure compliance with all applicable legal requirements. To the extent
permitted by applicable law, the Plan and Options granted hereunder shall be
deemed amended to the extent necessary to conform to such laws, rules and
regulations.

      8.10. Titles.  Titles are provided herein for convenience only and
are not to serve as a basis for interpretation or construction of the Plan.

                                       14
<PAGE>
                                                                Exhibit 10.1

      8.11. Governing Law.  The Plan and any agreements hereunder shall be
administered, interpreted and enforced under the internal laws of the
State of Delaware without regard to conflicts of laws thereof.

            I hereby certify that the foregoing Plan was duly adopted by the
Board of Directors of MSS-Delaware on August 3, 1998.

            Executed on this 3rd day of August, 1998.

                                                   /s/ David R. Geltzer
                                                   ____________________________
                                                   Name: David R. Geltzer
                                                   Its: Secretary

                                       15

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00034-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00034-of-00352.parquet"}]]