Document:

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                                                                     EXHIBIT 4.6

                                   F&M BANCORP
                         1999 EMPLOYEE STOCK OPTION PLAN

1.      PURPOSES OF THE PLAN:

        To advance the interests of F&M Bancorp (the "Corporation") and its
subsidiaries by assisting in attracting and retaining qualified employees and
providing them with increased motivation to exert their best efforts on behalf
of the Corporation and its subsidiaries.

2.      ADMINISTRATION:

        The Plan shall be administered by a committee (the "Committee")
consisting of not less than two directors of the Corporation to be appointed by
and to serve during the pleasure of the Board of Directors. The Committee shall
consist only of "disinterested persons" as that term is defined in Rule 16b-3 of
the Securities Exchange Act of 1934 (the "Exchange Act"). None of the Committee
members shall be eligible to participate in the Plan nor, during one year prior
to service as a member of the Committee, shall have been granted or awarded
equity securities pursuant to the Plan or any other plan of the Corporation or
any of its affiliates except as permitted by Rule 16b-3 under the Exchange Act.
The Committee shall select the particular employees to receive options from
among the senior management of the Corporation and its subsidiaries and shall
make all decisions concerning the timing, pricing and amount of options to be
granted. The Committee shall have full power to construe and interpret the Plan
and to promulgate such regulations with respect to the Plan as it may deem
desirable. The Committee shall report its deliberations to the Board of
Directors.

3.      STOCK SUBJECT TO OPTION:

        The shares to be issued upon exercise of options to be granted under the
Plan shall be 400,000 shares of the Common Stock (par value $5.00 per share) of
the Corporation (the "Common Stock") to be authorized by stockholders for
issuance under the Plan. In addition, any shares of Common Stock remaining
available for grant under the Corporation's Restated 1983 Stock Option Plan or
the Corporation's 1995 Stock Option Plan, or that become available for grant
under either such plan shall be available for grant under this Plan. If any
unexercised option terminates for any reason, the shares covered thereby shall
become available for grant of an option again.

4.      ELIGIBILITY:

        The individuals who shall be eligible to participate in the Plan shall
be such key employees (including officers and directors who are employees) of
the Corporation, or of any corporation (a "Subsidiary") in an unbroken chain of
corporations including the Corporation if, at the time of the granting of the
option, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one or more of the other corporations in such chain.

5.      TERMS AND CONDITIONS OF OPTIONS:

        Options under this Plan are intended to be either incentive options
qualifying under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code") or non-statutory options not qualifying under any section of the
Code as the Committee may recommend in its discretion from time to time. All
options granted under this Plan shall be issued upon such terms and conditions
as the Committee may recommend and the Board of Directors may approve from time
to time, subject to the following provisions (which shall apply to both
incentive and non-qualified stock options unless otherwise indicated):

                (a)     Option Price. The option price per share with respect to
                each option shall be not less than: (i) for incentive stock
                options, 100% of the

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                fair market value of the Common Stock on the date the option is
                granted; and (ii) for non-qualified stock options, 85% of the
                fair market value of the Common Stock on the date the option is
                granted.

                (b)     Number of Options. The Corporation can grant an employee
                        incentive stock options to acquire Common Stock of any
                        value, provided that the fair market value (determined
                        at the date of grant) of the stock subject to one or
                        more incentive stock options (under this Plan and all
                        other plans of the Corporation and its subsidiaries)
                        first exercisable in any one calendar year does not
                        exceed $100,000 (determined at the date of grant). If
                        any incentive stock option granted under this Plan would
                        cause such dollar limit to be exceeded, then the excess
                        portion of the incentive stock option shall become
                        exercisable in the next or succeeding calendar year in
                        which its exercisability would not violate the dollar
                        limitation. No options may be granted to any person who
                        directly or indirectly owns immediately prior to or
                        immediately after the grant, in excess of 10% of the
                        Corporation's outstanding Common Stock. No option shall
                        be an incentive stock option unless so designated by the
                        Committee at the time of grant. Notwithstanding the
                        foregoing, no employee shall be granted options for more
                        than 25,000 shares of Common Stock in any one calendar
                        year.

                (c)     Exercise of Options.

                        (i) Except as provided in paragraph (ii) below, full
                payment for shares acquired shall be made in cash or by
                certified check at or prior to the time that an option, or any
                part thereof, is exercised. The participant will have no rights
                as a stockholder until the certificate for those shares as to
                which the option is exercised has been issued by the
                Corporation. No option may be exercised during the first year
                from the date of grant. Thereafter, options for 200 shares or
                less shall be exercisable in full. Options for more than 200
                shares shall be exercisable to the extent of 25% after the
                expiration of one year from the date of grant, to the extent of
                50% after the expiration of two years from the date of grant, to
                the extent of 75% after the expiration of three years from the
                date of grant, and to the extent of 100% after the expiration of
                four years from the date of grant. The Committee may impose
                resale restrictions on all or a portion of the shares delivered
                upon exercise of any option. All options will, however, vest and
                become fully exercisable in the event of a change-in-control.

        Change-in-Control of the Corporation. Change-in-Control shall be deemed
to have occurred if the event set forth in any one of the following paragraphs
shall have occurred:

                        (i)     any Person is or becomes the Beneficial Owner,
                                directly or indirectly, of securities of the
                                Corporation (not including in the securities
                                beneficially owned by such Person any securities
                                acquired directly from the Corporation or its
                                Affiliates) representing 25% or more of the
                                combined voting power of the Corporation's then
                                outstanding securities, excluding any Person who
                                becomes such a Beneficial Owner in connection
                                with a transaction described in clause (A) of
                                paragraph (iii) below; or
                        (ii)    the following individuals cease for any reason
                                to constitute a majority of the number of
                                directors then serving on the Board; individuals
                                who,

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                                on the date hereof, constitute the Board and any
                                new director (other than a director whose
                                initial assumption of office is in connection
                                with an actual or threatened election contest,
                                including but not limited to a consent
                                solicitation, relating to the election of
                                directors of the Corporation) whose appointment
                                or election by the Board or nomination for
                                election by the Corporation's shareholders was
                                approved or recommended by a vote of at least
                                two-thirds (2/3) of the directors then still in
                                office who either were directors on the date
                                hereof or whose appointment, election or
                                nomination for election was previously so
                                approved or recommended; or
                        (iii)   there is consummated a merger or consolidation
                                of the Corporation or any direct or indirect
                                subsidiary of the Corporation with any other
                                corporation, other than (A) a merger or
                                consolidation which would result in the voting
                                securities of the Corporation outstanding
                                immediately prior to such merger or
                                consolidation continuing to represent (either by
                                remaining outstanding or by being converted into
                                voting securities of the surviving entity or any
                                parent thereof), in combination with the
                                ownership of any trustee or other fiduciary
                                holding securities under an employee benefit
                                plan of the Corporation or any subsidiary of the
                                Corporation, at least 60% of the combined voting
                                power of the securities of the Corporation or
                                such surviving entity or any parent thereof
                                outstanding immediately after such merger or
                                consolidation, or (B) a merger or consolidation
                                effected to implement a recapitalization of the
                                Corporation (or similar transaction) in which no
                                Person is or becomes the Beneficial Owner,
                                directly or indirectly, of securities of the
                                Corporation (not including in the securities
                                Beneficially Owned by such Person any securities
                                acquired directly from the Corporation or its
                                Affiliates) representing 25% or more of the
                                combined voting power of the Corporation then
                                outstanding securities.
                        (iv)    the shareholders of the Corporation approve a
                                plan of complete liquidation or dissolution of
                                the Corporation or there is consummated an
                                agreement for the sale or disposition by the
                                Corporation of all or substantially all of the
                                Corporation's assets, other than a sale or
                                disposition by the Corporation of all or
                                substantially all of the Corporations' assets to
                                an entity, at least 60% of the combined voting
                                power of the voting securities of which are
                                owned by shareholders of the Corporation in
                                substantially the same proportions as their
                                ownership of the Corporation immediately prior
                                to such sale;
                        (v)     the Corporation ceases to own, directly or
                                indirectly, securities of any subsidiary
                                representing 50% or more of the combined voting
                                power of the subsidiary's then outstanding
                                securities; or
                        (vi)    there is consummated an agreement for the sale
                                or disposition by the Corporation of all or
                                substantially all of a subsidiary's assets,
                                other than a sale or disposition by the
                                Corporation of all or substantially all of the
                                subsidiary's assets to an entity, at least 60%
                                of the combined voting power of the voting
                                securities of which are owned by shareholders of
                                the Corporation in substantially the same
                                proportions as their ownership of the subsidiary
                                immediately prior to such sale; provided
                                however, that such a sale or disposition should
                                only be effective for those Option holders, if
                                any, employed by the subsidiary whose assets are
                                so sold or otherwise disposed of, and not all
                                participating Option holders.

                                "Affiliate" shall have the meaning set forth in
                                Rule 12b-2 promulgated under Section 12 of the
                                Exchange Act.

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                                "Beneficial Owner" shall have the meaning set
                                forth in Rule 13d-3 under the Exchange Act.

                                "Board" shall mean the board of directors of the
                                Corporation.

                                "Exchange Act" shall mean the Securities
                                Exchange Act of 1934, as amended from time to
                                time.

                                "Person" shall have the meaning given in Section
                                3(a)(9) of the Exchange Act, as modified and
                                used in Sections 13(d) and 14(d) thereof, except
                                that such term shall not include (i) the
                                Corporation or any of their subsidiaries, (ii) a
                                trustee or other fiduciary holding securities
                                under an employee benefit plan of the
                                Corporation or any of their Affiliates, (iii) an
                                underwriter temporarily holding securities
                                pursuant to an offering of such securities, or
                                (iv) a corporation owned, directly or
                                indirectly, by the shareholders of the
                                Corporation in substantially the same
                                proportions as their ownership of stock of the
                                Corporation.

                        (ii) In the discretion of the Committee, the option
price of an option may be payable through the delivery of shares of Common Stock
with a value equal to the option price or in a combination of cash and Common
Stock with a value equal to the option price.

                (d)     Term of Option.

                        (i) No incentive stock option shall be granted for a
                term of more than 10 years from the date such option is granted.

                        (ii) No non-qualified stock option shall be granted for
                a term of more than 10 years from the date such option is
                granted.

                (e)     Termination of Employment. Each option, to the extent
                that it shall not have been exercised, shall terminate 90 days
                after the employment of the participant by the Corporation
                terminates. Nothing in this paragraph shall operate to extend
                the term of the option beyond the term stated in the agreement
                granting the option or to accelerate the period during which
                portions of the option may be exercised.

                (f)     Option Nonassignable and Nontransferable. Each option
                and all rights thereunder, including the right to surrender the
                option, shall be nonassignable and nontransferable other than by
                will or the laws of descent and distribution or pursuant to a
                qualified domestic relations order as defined by the Code or
                Title I of the Employee Retirement Income Security Act, or the
                rules thereunder. The designation of a beneficiary by a
                participant in the Plan does not constitute a transfer. Options
                shall be exercisable during the optionee's lifetime only by the
                optionee or his or her guardian or legal representative. Upon
                death, options shall be exercisable by the Option holder's
                personal representative. Notwithstanding the foregoing
                restrictions, in the event that Rule 16b-3 promulgated under the
                Securities Exchange Act of 1934 is amended to permit further
                assignment or transfer of options, such assignments or transfers
                shall be permissible under the Plan.

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6.      SURRENDER OF OPTIONS FOR CASH:

        Any option granted under the Plan, with the express statement in the
option grant recognizing this paragraph, may include a right to surrender to the
corporation up to 50% of the option to the extent then exercisable and receive
in exchange a cash payment equal to the excess of the fair market value of the
shares covered by the option or portion thereof surrendered over the aggregate
option price of such shares. For the purposes of this paragraph, fair market
value shall be determined by the Committee. Such right may be granted by the
Board of Directors upon recommendation of the Committee concurrently with the
option or thereafter by amendment upon such terms and conditions as the
Committee may recommend. Shares subject to an option or portion thereof that
have been so surrendered shall not thereafter be available for option grants
under the Plan. The Committee may from time to time recommend to the Board of
Directors the maximum amount of cash that may be paid upon surrender of options
in any year, may determine that, if the amount to be received by any optionee is
reduced in any year because of such limitation, all or a portion of the amount
not paid may be paid in any subsequent year or years, and may limit the right of
surrender to certain periods during the year.

7.      PAYROLL DEDUCTIONS:

        In the discretion of the Committee, there may be made available to
optionees an election for the payroll deduction each pay period over the term of
the option of amounts equal to the aggregate exercise price of any or all of
such options (and estimated federal income taxes thereon). Interest will be paid
on payroll deductions at rates prescribed from time to time by the Board of
Directors upon recommendation of the Committee.

8.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION:

        If the outstanding shares of the Common Stock are increased, decreased,
or changed into, or exchanged for a different number or kind of shares or
securities of the Corporation, without receipt of consideration by the
Corporation, through reorganization, merger, statutory share exchange,
recapitalization, reclassification, stock split-up, stock dividend, stock
consolidation, or otherwise, an appropriate and proportionate adjustment shall
be made in the number and kind of shares as to which options may be granted. A
corresponding adjustment in the price per share and number and kind of shares
allocated to unexercised options, or portions thereof, which shall have been
granted prior to any such change shall likewise be made. Any such adjustment,
however, in an outstanding option shall be made without change in the total
price applicable to the unexercised portion of the option but with a
corresponding adjustment in the price for each share subject to the option.
Adjustments under this section shall be made by the Board of Directors, whose
determination as to what adjustments shall be made, and the extent thereof,
shall be final and conclusive. No fractional shares of Common Stock shall be
issued under the Plan on account of any such adjustment.

9.      OPTIONS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY OTHER CORPORATIONS:

        Options may be granted under the Plan from time to time in substitution
for stock options held by employees of corporations who become or are about to
become key employees of the Corporation or a subsidiary of the Corporation as
the result of a merger or consolidation of the employing corporation with the
Corporation or a subsidiary, or the acquisition by the Corporation or a
subsidiary of the assets of the employing corporation, or the acquisition by the
Corporation or a subsidiary of stock of the employing corporation as the result
of which it becomes a subsidiary of the Corporation. The terms and conditions of
the substitute options so granted may vary from the terms and conditions set
forth in paragraph 5 of this Plan to such extent as the Board of Directors at
the time of grant may deem appropriate to conform, in whole or in part, to the
provisions of the options in substitution for which they are granted.

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10.     EFFECTIVE DATE OF THE PLAN:

        The Plan shall become effective upon approval by the Board of Directors,
subject to approval by the stockholders of the Corporation.

11.     TERMINATION DATE:

        No options may be granted under the Plan after December 31, 2005.
Subject to Section 5(d), options granted before the termination date for the
Plan may extend beyond that date.

12.     STOCK OPTION AGREEMENTS AND COMMON STOCK RECEIVED UPON  EXERCISE:

        (a)     Stock Option Agreement. Options awarded to participants under
the Plan shall be evidenced by a stock option agreement (the "Agreement"). Each
Agreement shall designate the number of shares of Common Stock to be acquired by
the participant upon exercise of the stock option and the price per share at
which the option may be exercised, subject to any adjustment as provided herein.
Each Agreement shall be executed by the Corporation and by the participant,
shall be binding upon each of them, and may be executed in separate
counterparts, each of which shall be deemed to be an original and all of which
taken together constitute one and the same agreement.

        (b)     Restriction on Exercise: The stock options granted hereunder may
not be exercised if the issuance of the Common Stock upon such exercise or the
method of payment of consideration for such Common Stock would constitute a
violation of any applicable federal or state securities or other law or
regulation. As a condition to the exercise of any stock option granted
hereunder, the Corporation may require the participant to make any
representation and warranty to the Corporation as may be required or advisable
under any applicable law or regulation.

        (c)     Restricted Stock. If the shares of Common Stock that will be
received upon the exercise of stock options granted under the Plan have not been
registered under the Securities Act of 1933 or any applicable state securities
laws they will be restricted stock. The certificates representing such shares of
Common Stock will bear the following legend:

        THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE (THE
        "SHARES") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
        AMENDED (THE "ACT") AND HAVE BEEN ISSUED PURSUANT TO EXCEPTIONS UNDER
        THE ACT AND UNDER APPLICABLE STATE SECURITIES LAWS. THEY MAY NOT BE
        SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
        REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SHARES UNDER SUCH
        ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH
        REGISTRATION IS NOT REQUIRED UNDER THE ACT OR UNDER APPLICABLE STATE
        SECURITIES LAWS OR UNLESS SOLD PURSUANT TO AND IN COMPLIANCE WITH RULE
        144 OF SUCH ACT.

13.     COMPLIANCE WITH LAWS AND REGULATIONS:

        The grant, holding and vesting of all options under the Plan shall be
subject to any and all requirements and restrictions that may, in the opinion of
the Committee, be necessary or advisable for the purposes of complying with any
statute, rule or regulation of any governmental authority, or any agreement,
policy or rule of any stock exchange or other regulatory organization governing
any market on which the Common Stock is traded. The Corporation may withhold or
require payment for income and/or employment taxes as required by law.

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14.     AMENDMENT OF THE PLAN:

        The Plan may be amended by the Board of Directors; however, no amendment
to the Plan materially increasing the benefits accruing to participants or
materially increasing the number of shares of Common Stock that may be issued
upon the exercise or surrender of stock options under the Plan (except
adjustments pursuant to Section 8) or materially modifying any requirements as
to eligibility for participation in the Plan shall be effective unless approved
by the stockholders of the Corporation. No amendment shall become effective
without the prior approval of the stockholders of the Corporation if stockholder
approval would be required for continued compliance with Rule 16b-3 of the
Exchange Act or, with respect to incentive stock options, with applicable
provisions of the Code.

15.     MISCELLANEOUS:

        (a)     Expenses. The Corporation shall bear all expenses and costs in
connection with the administration of the Plan.

        (b)     Designation of Beneficiaries. A participant may designate a
beneficiary to receive any distribution under the Plan upon his or her death.

        (c)     Applicable Law. The validity, interpretation and administration
of this Plan and any rules, regulations, determinations or decisions made
hereunder, and the rights of any and all persons having or claiming to have any
interest herein or hereunder, shall be determined exclusively in accordance with
the laws of the State of Maryland, without regard to the choice of laws
provisions thereof.

        (d)     Headings. The headings herein are for reference purposes only
and shall not affect the meaning or interpretation of the Plan.

        (e)     Notices. All notices or other communications made or given
pursuant to this Plan shall be in writing and shall be sufficiently made or
given if hand-delivered or mailed by certified mail, addressed to any
participant at the address contained in the records of the Corporation or to the
Corporation at its principal office.

        (f)     Federal Securities Law Requirement. Awards granted hereunder
shall be subject to all conditions required under Rule 16b-3 to qualify the
award for any exception from the provisions of Section 16(b) of the Securities
Exchange Act of 1934 available under that Rule.<PAGE>

                                                                     EXHIBIT 4.7

                                   F&M BANCORP
                             1999 STOCK OPTION PLAN
                           FOR NON-EMPLOYEE DIRECTORS

1.      PURPOSES OF THE PLAN:

        To advance the interests of F&M Bancorp (the "Corporation") and its
subsidiaries by assisting in attracting and retaining qualified persons to serve
as directors of the Corporation and its subsidiaries, encouraging stock
ownership by directors, and more closely aligning the personal interests of
directors with the interests of stockholders.

2.      ADMINISTRATION:

        The Plan shall be administered by a committee (the "Committee")
consisting of not less than two directors of the Corporation to be appointed by
and to serve during the pleasure of the Board of Directors. The Committee shall
have full power to construe and interpret the Plan and to promulgate such
regulations with respect to the Plan as it may deem desirable. The Committee
shall report its deliberations to the Board of Directors. Notwithstanding the
above, the selection of the Directors to whom stock options are to be granted,
the timing of such grants, the number of shares subject to any stock option, the
exercise price of any stock option, the periods during which any stock option
may be exercised and the term of any stock option shall be as hereinafter
provided, and the Committee shall have no discretion as to such matters.

3.      STOCK SUBJECT TO OPTION:

        The shares to be issued upon exercise of options to be granted under the
Plan shall be 60,000 shares of the Common Stock (par value $5.00 per share) of
the Corporation (the "Common Stock") to be authorized by stockholders for
issuance under the Plan. If any unexercised option terminates for any reason,
the shares covered thereby shall become available for grant of an option again.

4.      TERMS AND CONDITIONS OF OPTIONS:

        Options under this Plan are intended to be non-statutory options not
qualifying under any section of the Internal Revenue Code of 1986, as amended
(the "Code"), (commonly referred to as non-qualified options). All options
granted under this Plan shall be issued upon the following terms and conditions:

                (a)     Option Price. The option price per share with respect to
                        each option shall be not less than: (i) 100% of the fair
                        market value of the Common Stock on the date the option
                        is granted.

                (d)     Number of Options. Each year each person who shall be
                        elected to serve as a director of the Corporation or
                        whose term shall continue shall be awarded not more than
                        2000 shares in option form on the day following the
                        annual stockholders meeting.

                (c)     Exercise of Options.

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                        (i) Except as provided in paragraph (ii) below, full
                payment for shares acquired shall be made in cash or by
                certified check at or prior to the time that an option, or any
                part thereof, is exercised. The participant will have no rights
                as a stockholder until the certificate for those shares as to
                which the option is exercised has been issued by the
                Corporation. No option may be exercised during the first 6
                months from the date of grant. Thereafter, options shall be
                exercisable in full. The Committee may impose resale
                restrictions on all or a portion of the shares delivered upon
                exercise of any option. All options will, however, vest and
                become fully exercisable in the event of a change-in-control.

        Change-in-Control of the Corporation. Change-in-Control shall be deemed
to have occurred if the event set forth in any one of the following paragraphs
shall have occurred:

                        (vii)   any Person is or becomes the Beneficial Owner,
                                directly or indirectly, of securities of the
                                Corporation (not including in the securities
                                beneficially owned by such Person any securities
                                acquired directly from the Corporation or its
                                Affiliates) representing 25% or more of the
                                combined voting power of the Corporation's then
                                outstanding securities, excluding any Person who
                                becomes such a Beneficial Owner in connection
                                with a transaction described in clause (A) of
                                paragraph (iii) below; or
                        (viii)  the following individuals cease for any reason
                                to constitute a majority of the number of
                                directors then serving on the Board; individuals
                                who, on the date hereof, constitute the Board
                                and any new director (other than a director
                                whose initial assumption of office is in
                                connection with an actual or threatened election
                                contest, including but not limited to a consent
                                solicitation, relating to the election of
                                directors of the Corporation) whose appointment
                                or election by the Board or nomination for
                                election by the Corporation's shareholders was
                                approved or recommended by a vote of at least
                                two-thirds (2/3) of the directors then still in
                                office who either were directors on the date
                                hereof or whose appointment, election or
                                nomination for election was previously so
                                approved or recommended; or
                        (ix)    there is consummated a merger or consolidation
                                of the Corporation or any direct or indirect
                                subsidiary of the Corporation with any other
                                corporation, other than (A) a merger or
                                consolidation which would result in the voting
                                securities of the Corporation outstanding
                                immediately prior to such merger or
                                consolidation continuing to represent (either by
                                remaining outstanding or by being converted into
                                voting securities of the surviving entity or any
                                parent thereof), in combination with the
                                ownership of any trustee or other fiduciary
                                holding securities under an employee benefit
                                plan of the Corporation or any subsidiary of the
                                Corporation, at least 60% of the combined voting
                                power of the securities of the Corporation or
                                such surviving entity or any parent thereof
                                outstanding immediately after such merger or
                                consolidation, or (B) a merger or consolidation
                                effected to implement a recapitalization of the
                                Corporation (or similar transaction) in which no
                                Person is or becomes the Beneficial Owner,
                                directly or indirectly, of securities of the
                                Corporation (not including in the securities
                                Beneficially Owned by such Person any securities
                                acquired directly from the Corporation or its
                                Affiliates) representing 25% or more of the
                                combined voting power of the Corporation then
                                outstanding securities.
                        (x)     the shareholders of the Corporation approve a
                                plan of complete

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                                liquidation or dissolution of the Corporation or
                                there is consummated an agreement for the sale
                                or disposition by the Corporation of all or
                                substantially all of the Corporation's assets,
                                other than a sale or disposition by the
                                Corporation of all or substantially all of the
                                Corporation's assets to an entity, at least 60%
                                of the combined voting power of the voting
                                securities of which are owned by shareholders of
                                the Corporation in substantially the same
                                proportions as their ownership of the
                                Corporation immediately prior to such sale;
                        (xi)    the Corporation ceases to own, directly or
                                indirectly, securities of any subsidiary
                                representing 50% or more of the combined voting
                                power of the subsidiary's then outstanding
                                securities; or
                        (xii)   there is consummated an agreement for the sale
                                or disposition by the Corporation of all or
                                substantially all of a subsidiary's assets,
                                other than a sale or disposition by the
                                Corporation of all or substantially all of the
                                subsidiary's assets to an entity, at least 60%
                                of the combined voting power of the voting
                                securities of which are owned by shareholders of
                                the Corporation in substantially the same
                                proportions as their ownership of the subsidiary
                                immediately prior to such sale; provided
                                however, that such a sale or disposition should
                                only be effective for those option holders, if
                                any, employed by the subsidiary whose assets are
                                so sold or otherwise disposed of, and not all
                                participating option holders.

                                "Affiliate" shall have the meaning set forth in
                                Rule 12b-2 promulgated under Section 12 of the
                                Exchange Act.

                                "Beneficial Owner" shall have the meaning set
                                forth in Rule 13d-3 under the Exchange Act.

                                "Board" shall mean the board of directors of the
                                Corporation.

                                "Exchange Act" shall mean the Securities
                                Exchange Act of 1934, as amended from time to
                                time.

                                "Person" shall have the meaning given in Section
                                3(a)(9) of the Exchange Act, as modified and
                                used in Sections 13(d) and 14(d) thereof, except
                                that such term shall not include (i) the
                                Corporation or any of their subsidiaries, (ii) a
                                trustee or other fiduciary holding securities
                                under an employee benefit plan of the
                                Corporation or any of their Affiliates, (iii) an
                                underwriter temporarily holding securities
                                pursuant to an offering of such securities, or
                                (iv) a corporation owned, directly or
                                indirectly, by the shareholders of the
                                Corporation in substantially the same
                                proportions as their ownership of stock of the
                                Corporation.

                        (ii) In the discretion of the Committee, the option
price of an option may be payable through the delivery of shares of Common Stock
with a value equal to the option price or in a combination of cash and Common
Stock with a value equal to the option price.

                (d)     Term of Option.

                        No option shall be granted for a term of more than 10
                years from the date such option is granted.

<PAGE>

                (e)     Termination of Employment. Each option, to the extent
                that it shall not have been exercised, shall terminate 90 days
                after the date on which the participant ceases to serve as a
                director of the Corporation. Nothing in this paragraph shall
                operate to extend the term of the option beyond the term stated
                in the agreement granting the option or to accelerate the period
                during which portions of the option may be exercised.

                (f)     Option Nonassignable and Nontransferable. Each option
                and all rights thereunder, including the right to surrender the
                option, shall be nonassignable and nontransferable other than by
                will or the laws of descent and distribution or pursuant to a
                qualified domestic relations order as defined by the Code or
                Title I of the Employee Retirement Income Security Act, or the
                rules thereunder. The designation of a beneficiary by a
                participant in the Plan does not constitute a transfer. Options
                shall be exercisable during the optionee's lifetime only by the
                optionee or his or her guardian or legal representative. Upon
                death, options shall be exercisable by the option holder's
                personal representative. Notwithstanding the foregoing
                restrictions, in the event that Rule 16b-3 promulgated under the
                Securities Exchange Act of 1934 is amended to permit further
                assignment or transfer of options, such assignments or transfers
                shall be permissible under the Plan.

<PAGE>

5.      SURRENDER OF OPTIONS FOR CASH:

        Any option granted under the Plan, with the express statement in the
option grant recognizing this paragraph, may include a right to surrender to the
corporation up to 50% of the option to the extent then exercisable and receive
in exchange a cash payment equal to the excess of the fair market value of the
shares covered by the option or portion thereof surrendered over the aggregate
option price of such shares. For the purposes of this paragraph, fair market
value shall be determined by the Committee. Such right may be granted by the
Board of Directors upon recommendation of the Committee concurrently with the
option or thereafter by amendment upon such terms and conditions as the
Committee may recommend. Shares subject to an option or portion thereof that
have been so surrendered shall not thereafter be available for option grants
under the Plan. The Committee may from time to time recommend to the Board of
Directors the maximum amount of cash that may be paid upon surrender of options
in any year, may determine that, if the amount to be received by any optionee is
reduced in any year because of such limitation, all or a portion of the amount
not paid may be paid in any subsequent year or years, and may limit the right of
surrender to certain periods during the year.

6.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION:

        If the outstanding shares of the Common Stock are increased, decreased,
or changed into, or exchanged for a different number or kind of shares or
securities of the Corporation, without receipt of consideration by the
Corporation, through reorganization, merger, statutory share exchange,
recapitalization, reclassification, stock split-up, stock dividend, stock
consolidation, or otherwise, an appropriate and proportionate adjustment shall
be made in the number and kind of shares as to which options may be granted. A
corresponding adjustment in the price per share and number and kind of shares
allocated to unexercised options, or portions thereof, which shall have been
granted prior to any such change shall likewise be made. Any such adjustment,
however, in an outstanding option shall be made without change in the total
price applicable to the unexercised portion of the option but with a
corresponding adjustment in the price for each share subject to the option.
Adjustments under this section shall be made by the Board of Directors, whose
determination as to what adjustments shall be made, and the extent thereof,
shall be final and conclusive. No fractional shares of Common Stock shall be
issued under the Plan on account of any such adjustment.

7.      EFFECTIVE DATE OF THE PLAN:

        The Plan shall become effective upon approval by the Board of Directors,
subject to approval by the stockholders of the Corporation.

<PAGE>

8.      TERMINATION DATE:

        No options may be granted under the Plan after December 31, 2005.
Subject to Section 4(d), options granted before the termination date for the
Plan may extend beyond that date.

9.      STOCK OPTION AGREEMENTS AND COMMON STOCK RECEIVED UPON  EXERCISE:

        (a)     Stock Option Agreement. Options awarded to participants under
the Plan shall be evidenced by a stock option agreement (the "Agreement"). Each
Agreement shall designate the number of shares of Common Stock to be acquired by
the participant upon exercise of the stock option and the price per share at
which the option may be exercised, subject to any adjustment as provided herein.
Each Agreement shall be executed by the Corporation and by the participant,
shall be binding upon each of them, and may be executed in separate
counterparts, each of which shall be deemed to be an original and all of which
taken together constitute one and the same agreement.

        (b)     Restriction on Exercise: The stock options granted hereunder may
not be exercised if the issuance of the Common Stock upon such exercise or the
method of payment of consideration for such Common Stock would constitute a
violation of any applicable federal or state securities or other law or
regulation. As a condition to the exercise of any stock option granted
hereunder, the Corporation may require the participant to make any
representation and warranty to the Corporation as may be required or advisable
under any applicable law or regulation.

        (c)     Restricted Stock. If the shares of Common Stock that will be
received upon the exercise of stock options granted under the Plan have not been
registered under the Securities Act of 1933 or any applicable state securities
laws they will be restricted stock. The certificates representing such shares of
Common Stock will bear the following legend:

        THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE (THE
        "SHARES") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
        AMENDED (THE "ACT") AND HAVE BEEN ISSUED PURSUANT TO EXCEPTIONS UNDER
        THE ACT AND UNDER APPLICABLE STATE SECURITIES LAWS. THEY MAY NOT BE
        SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A
        REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SHARES UNDER SUCH
        ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH
        REGISTRATION IS NOT REQUIRED UNDER THE ACT OR UNDER APPLICABLE STATE
        SECURITIES LAWS OR UNLESS SOLD PURSUANT TO AND IN COMPLIANCE WITH RULE
        144 OF SUCH ACT.

<PAGE>

10.     COMPLIANCE WITH LAWS AND REGULATIONS:

        The grant, holding and vesting of all options under the Plan shall be
subject to any and all requirements and restrictions that may, in the opinion of
the Committee, be necessary or advisable for the purposes of complying with any
statute, rule or regulation of any governmental authority, or any agreement,
policy or rule of any stock exchange or other regulatory organization governing
any market on which the Common Stock is traded. The Corporation may withhold or
require payment for income and/or employment taxes as required by law.

11.     AMENDMENT OF THE PLAN:

        The Plan may be amended by the Board of Directors; however, no amendment
to the Plan materially increasing the benefits accruing to participants or
materially increasing the number of shares of Common Stock that may be issued
upon the exercise or surrender of stock options under the Plan (except
adjustments pursuant to Section 6) or materially modifying any requirements as
to eligibility for participation in the Plan shall be effective unless approved
by the stockholders of the Corporation. No amendment shall become effective
without the prior approval of the stockholders of the Corporation if stockholder
approval would be required for continued compliance with Rule 16b-3 of the
Exchange Act.

12.     MISCELLANEOUS:

        (a)     Expenses. The Corporation shall bear all expenses and costs in
connection with the administration of the Plan.

        (b)     Designation of Beneficiaries. A participant may designate a
beneficiary to receive any distribution under the Plan upon his or her death.

        (c)     Applicable Law. The validity, interpretation and administration
of this Plan and any rules, regulations, determinations or decisions made
hereunder, and the rights of any and all persons having or claiming to have any
interest herein or hereunder, shall be determined exclusively in accordance with
the laws of the State of Maryland, without regard to the choice of laws
provisions thereof.

        (d)     Headings. The headings herein are for reference purposes only
and shall not affect the meaning or interpretation of the Plan.

        (e)     Notices. All notices or other communications made or given
pursuant to this Plan shall be in writing and shall be sufficiently made or
given if hand-delivered or mailed by certified mail, addressed to any
participant at the address contained in the records of the Corporation or to the
Corporation at its principal office.

        (f)     Federal Securities Law Requirement. Awards granted hereunder
shall be subject to all conditions required under Rule 16b-3 to qualify the
award for any exception from the provisions of Section 16(b) of the Securities
Exchange Act of 1934 available under that Rule.

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