Document:

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EXHIBIT 10.1      HAVEN BANCORP, INC. 1996 STOCK INCENTIVE PLAN

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                  HAVEN BANCORP, INC. 1996 STOCK INCENTIVE PLAN

                          ADOPTED ON FEBRUARY 29, 1996
                         EFFECTIVE AS OF APRIL 24, 1996

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                                TABLE OF CONTENTS

ARTICLE I         PURPOSE.....................................................1

      Section 1.1  General Purpose of the Plan................................1

ARTICLE II        DEFINITIONS.................................................1

      Section 2.1  Administrator..............................................1
      Section 2.2  Annual Retainer............................................1
      Section 2.3  Appreciation Right.........................................1
      Section 2.4  Award......................................................1
      Section 2.5  Award Agreement............................................1
      Section 2.6  Award Recipient............................................1
      Section 2.7  Bank.......................................................1
      Section 2.8  Beneficiary................................................1
      Section 2.9  Board......................................................2
      Section 2.10 Change in Control..........................................2
      Section 2.11 Code.......................................................2
      Section 2.12 Committee..................................................2
      Section 2.13 Corporation................................................3
      Section 2.14 Disinterested Board Member.................................3
      Section 2.15 Dividend Equivalent Right..................................3
      Section 2.16 Effective Date.............................................3
      Section 2.17 Eligible Director..........................................3
      Section 2.18 Eligible Individual........................................3
      Section 2.19 Exercise Period............................................3
      Section 2.20 Exercise Price.............................................3
      Section 2.21 Fair Market Value..........................................3
      Section 2.22 Haven......................................................3
      Section 2.23 Incentive Stock Option.....................................3
      Section 2.24 Non-Qualified Stock Option.................................3
      Section 2.25 Option.....................................................4
      Section 2.26 Option Holder..............................................4
      Section 2.27 Person.....................................................4
      Section 2.28 Plan.......................................................4
      Section 2.29 Qualified Domestic Relations Order.........................4
      Section 2.30 Retirement.................................................4
      Section 2.31 Restricted Stock...........................................4
      Section 2.32 Share......................................................4
      Section 2.33 Vesting Date...............................................4

ARTICLE III             ADMINISTRATION........................................5

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      Section 3.1 Committee..................................................5
      Section 3.2 Committee Action...........................................5
      Section 3.3 Committee Responsibilities.................................5
      Section 3.4 Indemnification............................................6

ARTICLE IV        AVAILABLE SHARES AND AWARD AGREEMENTS......................7

      Section 4.1 Available Shares...........................................7
      Section 4.2 Option Agreements..........................................7

ARTICLE V         STOCK OPTIONS..............................................8

      Section 5.1 Options Granted to Eligible Individuals....................8
      Section 5.2 Options Granted to Eligible Directors......................9
      Section 5.3 Method of Exercise........................................10
      Section 5.4 Limitations on Options....................................11
      Section 5.5 Additional Limitations on Incentive Stock Options.........11

ARTICLE VI        APPRECIATION RIGHTS.......................................12

      Section 6.1 Appreciation Rights Granted to Eligible Individuals.......12
      Section 6.2 Appreciation Rights Granted to Eligible Directors.........12
      Section 6.3 Exercise of Appreciation Rights...........................13
      Section 6.4 Effect of Exercise........................................13

ARTICLE VII       RESTRICTED STOCK..........................................14

      Section 7.1 Restricted Stock Granted to Eligible Individuals..........14
      Section 7.2 Restricted Stock Granted to Eligible Directors............14
      Section 7.3 Stock Certificates........................................15
      Section 7.4 Shareholder Rights........................................15
      Section 7.5 Distribution of Shares....................................15

ARTICLE VIII      DIVIDEND EQUIVALENT RIGHTS................................15

      Section 8.1 In General................................................15
      Section 8.2 Form of Dividend Equivalents..............................16

ARTICLE IX        AMENDMENT AND TERMINATION.................................16

      Section 9.1 Termination...............................................16
      Section 9.2 Amendment.................................................16
      Section 9.3 Adjustments for Business Reorganization, Stock Split or
                  Stock Dividend............................................16

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ARTICLE X          MISCELLANEOUS.............................................17

      Section 10.1 Status as an Employee Benefit Plan........................17
      Section 10.2 No Right to Continued Employment or Board Membership......17
      Section 10.3 Construction of Language..................................18
      Section 10.4 Governing Law.............................................18
      Section 10.5 Headings..................................................18
      Section 10.6 Non-Alienation of Benefits................................18
      Section 10.7 Taxes.....................................................18
      Section 10.8 Approval of Shareholders..................................18
      Section 10.9 Notices...................................................19

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                  HAVEN BANCORP, INC. 1996 STOCK INCENTIVE PLAN

                                    ARTICLE I

                                     PURPOSE

      Section 1.1    General Purpose of the Plan
                     ---------------------------

            The  purpose  of the  Plan is to  advance  the  interests  of  Haven
Bancorp, Inc. and its shareholders by providing current directors,  officers and
employees of Haven and its  affiliates  with an  incentive to achieve  corporate
objectives,  and attracting and retaining  directors,  officers and employees of
outstanding  competence,  through the award of equity interests in Haven, and by
providing  a means for the payment of  compensation  earned  under the  Columbia
Federal Savings Bank Executive Incentive  Compensation Plan in the form of stock
options and awards.

                                   ARTICLE II

                                   DEFINITIONS

            The following definitions shall apply for the purposes of this Plan,
unless a different meaning is plainly indicated by the context.

      Section 2.1  Administrator  means the person or persons  designated by the
                   -------------
Committee  pursuant to Section 3.3 to assist the Committee in the administration
of the Plan.

      Section 2.2 Annual Retainer means the annual retainer,  if any, being paid
                  ---------------
to an Eligible  Director  for service on the Board and/or the board of directors
of the Bank.

      Section 2.3  Appreciation  Right means a right granted pursuant to Article
                   -------------------
VI which shall  entitle  the holder  thereof to receive in  accordance  with the
terms of such  Appreciation  Right an  amount  of cash  equal to the  difference
between the Fair Market Value of the Shares  subject to the  Appreciation  Right
and the Exercise Price  applicable to such  Appreciation  Right. For purposes of
this Section 2.3,  the Fair Market Value of a Share shall be  determined  on the
date the Appreciation Right is exercised.

      Section  2.4  Award means the grant of an  Option,  Appreciation  Right or
                    -----
Restricted Stock made pursuant to the Plan.

      Section 2.5  Award Agreement  means the written  agreement  evidencing the
                   ---------------
grant of an  Option,  an  Appreciation  Right or  Restricted  Stock  Award  made
pursuant to the Plan.

      Section  2.6  Award Recipient  means an  Eligible  Individual  or Eligible
                    ---------------
Director who has been granted an Option,  an  Appreciation  Right or  Restricted
Stock pursuant to the Plan.

      Section  2.7  Bank  means  Columbia  Federal  Savings  Bank,  a  federally
                    ----
chartered stock savings bank and any successor thereto.

      Section  2.8  Beneficiary  means the  person or persons  designated  by an
                    -----------
Eligible  Individual  or  Eligible  Director  in such form and  manner as may be
required by the Committee or  Administrator,  to receive his or her Award in the
event all or any portion of such Award remains unexercised or undistributed upon
his

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or her  death  or,  if no  such  Beneficiary  has  been  designated,  the  legal
representative of the Eligible Individual or Eligible Director.

      Section 2.9  Board means the board of directors of Haven.
                   -----

      Section 2.10  Change in  Control  means  an  event of the nature that: (a)
                    ------------------
would be  required  to be reported by Haven in response to Item 1 of the current
report on Form 8-K, as in effect on the date hereof,  pursuant to Sections 13 or
15(d) of the  Securities  Exchange  Act of 1934  (the  "Exchange  Act");  or (b)
results in a Change in Control  of the Bank or Haven  within the  meaning of the
Change in Bank Control Act and the rules and regulations  promulgated thereunder
by the appropriate  federal banking agency,  as in effect on the date hereof; or
(c) results in a  transaction  requiring  prior  Federal  Reserve  Board ("FRB")
approval  under  the  Bank  Holding  Company  Act of 1956  and  the  regulations
promulgated  thereunder  by the FRB,  as in  effect on the date  hereof;  or (d)
results in a transaction  requiring prior Office of Thrift  Supervision  ("OTS")
approval  under  the  Home  Owners'  Loan  Act and the  regulations  promulgated
thereunder  by the OTS, as in effect on the date  hereof.  Without  limiting the
foregoing, a Change in Control shall be deemed to have occurred at such time as:
(i) any "person" (as the term is used in Section 13(d) and 14(d) of the Exchange
Act) is or becomes  the  "beneficial  owner" (as defined in Rule 13d-3 under the
Exchange  Act),  directly  or  indirectly,  of  securities  of the Bank or Haven
representing 20% or more of the Bank's or Haven's outstanding securities, except
for any  securities  of the  Bank  purchased  by Haven  in  connection  with the
conversion  of the  Bank to the  stock  form  and any  securities  purchased  by
employee  benefit plans  maintained by the Bank or Haven, or such plans' related
trusts;  (ii)  individuals who constitute the Board of Directors of Haven or the
Board of Directors of the Bank on the date hereof (the "Incumbent  Board") cease
for any reason to  constitute  at least a majority  thereof,  provided  that any
individual  becoming a director subsequent to the date hereof whose election was
approved by a vote of at least  three-quarters  of the directors  comprising the
Incumbent  Board, or whose  nomination for election by Haven's  stockholders was
approved by the same  Nominating  Committee  serving  under an Incumbent  Board,
shall be, for  purposes  of this  clause  (ii),  considered  as though he were a
member  of the  Incumbent  Board,  but  only if such  individual's  election  or
nomination did not result from an actual or threatened  election contest (within
the meaning of Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
or other actual or threatened  solicitation  of proxies or consents  (within the
meaning of Rule 14a- 11 of Regulation  14A  promulgated  under the Exchange Act)
other  than  by  or  on  behalf  of  the  Board  of  Haven;   (iii)  a  plan  of
reorganization,  merger,  consolidation,  sale of all or  substantially  all the
assets of the Bank or Haven becomes effective or a similar transaction occurs in
which  the  Bank  or  Haven  is  not  the  resulting  entity;  (iv)  a  plan  of
reorganization,  merger, consolidation,  sale of all or substantially all of the
assets of the Bank or Haven or a similar  transaction,  which will result in the
outstanding  shares  of the class of  securities  then  subject  to such plan or
transaction being exchanged for or converted into cash or property or securities
not issued by the Bank or Haven,  is  approved by the  stockholders  of Haven in
response to a proxy  statement  that was  distributed,  soliciting  proxies from
stockholders of Haven, by someone other than the current management of Haven, or
(v) 20% or more of the voting  securities of the Bank or Haven then  outstanding
are  tendered and accepted by an offeror as of the closing of a tender offer for
such securities.

      Section 2.11 Code means the Internal  Revenue Code of 1986  (including the
                   ----
corresponding provisions of any succeeding law).

      Section 2.12  Committee means the Committee described in Section 3.1.
                    ---------

      Section  2.13  Corporation means  Haven, the  Bank  and any  successor  or
                     -----------
successors  thereto,  and  subject  to the  approval  of,  and  such  terms  and
conditions as may be imposed by, the Board, such other savings bank, savings and
loan association,  bank,  corporation,  financial  institution or other business
organization or institution as may be or become an affiliate of Haven.

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      Section 2.14 Disinterested Board Member means a member of the Board who is
                   --------------------------
not  currently  an  employee  of the  Company,  is not a former  employee of the
Company who  receives  compensation  for prior  services and has not at any time
previously been an officer of the Company.

      Section 2.15  Dividend Equivalent Right means a right described in Article
                    -------------------------
IX.

      Section 2.16  Effective  Date means the date on which the Plan is approved
                    ---------------
by the holders of a majority of the Shares  represented in person or by proxy at
a meeting duly called and held.

      Section 2.17 Eligible  Director means a member of the Board or a member of
                   ------------------
the board of  directors  of the Bank who is not an employee or an officer of the
Corporation.

      Section 2.18  Eligible  Individual  means any employee of the  Corporation
                    --------------------
whom the  Committee  may  select  to  receive  an Award  pursuant  to the  Plan,
provided,  however, that no Eligible Director shall be identified as an Eligible
Individual.

      Section 2.19 Exercise Period means the period during which an Option or an
                   ---------------
Appreciation Right may be exercised.

      Section 2.20 Exercise  Price means the price per Share (a) at which Shares
                   ---------------
subject to an Option  may be  purchased  upon  exercise  of the  Option  granted
pursuant to Sections 5.1 or 5.2, or (b) used to determine the payment to be made
pursuant to the exercise of an Appreciation  Right granted  pursuant to Sections
6.1 or 6.2.

      Section 2.21 Fair Market Value means,  when used in connection with Shares
                   -----------------
on a certain  date,  the average of the reported bid and ask price of the Shares
as  reported  by  the  National  Association  of  Securities  Dealers  Automated
Quotation System (as published by the Wall Street Journal, if published) on such
date or if the Shares were not traded on such date, on the next preceding day on
which the Shares were traded  thereon or the last  previous date on which a sale
is reported.

      Section 2.22 Haven means Haven Bancorp,  Inc., a corporation organized and
                   -----
existing under the laws of the State of Delaware, and any successor thereto.

      Section 2.23 Incentive  Stock Option means a right to purchase Shares that
                   -----------------------
is granted pursuant to Section 5.1, that is designated by the Committee to be an
Incentive Stock Option and that satisfies the requirements of Section 5.5 of the
Plan and Section 422 of the Code.

      Section 2.24  Non-Qualified  Stock Option means a right to purchase Shares
                    ---------------------------
that is either (a) granted pursuant to Section 5.1,  designated by the Committee
to  be a  Non-Qualified  Stock  Option  and  is  not  intended  to  satisfy  the
requirements of Section 422 of the Code, or (b) granted pursuant to Section 5.2.

      Section  2.25  Option  means  either  an  Incentive   Stock  Option  or  a
                     ------
Non-Qualified Stock Option granted under this Plan.

      Section  2.26 Option  Holder means an Eligible  Individual  or an Eligible
                    --------------
Director who has been granted an Option under the Plan,  or the  Beneficiary  of
such an Eligible Individual or Eligible Director.

      Section 2.27 Person means an individual, a corporation,  a bank, a savings
                   ------
bank, a savings and loan association, a financial institution, a partnership, an
association,  a  joint-stock  company,  a trust,  an estate,  an  unincorporated
organization and any other business organization or institution.

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      Section 2.28 Plan means the Haven Bancorp, Inc. 1996 Stock Incentive Plan,
                   ----
as amended from time to time.

      Section 2.29 Qualified Domestic Relations Order means a Domestic Relations
                   ----------------------------------
Order that: (a) clearly specifies (i) the name and last known mailing address of
the Option Holder and of each person given rights under such Domestic  Relations
Order, (ii) the amount or percentages of the Option Holder's benefits under this
Plan to be paid to each person covered by such Domestic  Relations Order,  (iii)
the number of  payments  or the period to which such  Domestic  Relations  Order
applies, and (iv) the name of this Plan; and (b) does not require the payment of
a benefit in a form or amount that is (i) not  otherwise  provided for under the
Plan, or (ii) inconsistent with a previous  Qualified  Domestic Relations Order.
For the  purposes of this Plan, a "Domestic  Relations  Order" means a judgment,
decree or order  (including the approval of a property  settlement) that is made
pursuant to a state domestic  relations or community property law and relates to
the provision of child support,  alimony payments, or marital property rights to
a spouse, child or other dependent of an Option Holder.

      Section 2.30 Retirement means, in the case of an Eligible  Director,  such
                   ----------
Eligible Director's  termination of service, other than for cause, upon or after
(a)  completing  at  least 5 years  of  service  on the  Board  or the  board of
directors of the Bank,  without  regard to any breaks in such  service,  and (b)
attaining age 55.

      Section  2.31  Restricted  Stock means Shares that have been granted to an
                     -----------------
Eligible  Individual or Eligible  Director pursuant to Article VII, which Shares
shall not be transferable  by the Award Recipient by means of sale,  assignment,
exchange,  pledge  or  otherwise,  until  the  Vesting  Date  or  Vesting  Dates
applicable to such Shares.

      Section 2.32  Share means a share of common stock of Haven.
                    -----

      Section 2.33 Vesting Date means the date  established  by the Committee or
                   ------------
prescribed  in  Sections  5.2,  6.2  or  7.2,  as of  which  (a)  an  Option  or
Appreciation Right may first be exercised,  or (b) the restrictions  relating to
Restricted  Stock will lapse. By way of example and not by way of limitation,  a
Vesting Date  established  by the Committee  with respect to an Award made to an
Eligible  Individual may be a fixed calendar date, the date on which individual,
group, departmental, divisional or corporate performance criteria established by
the Committee are achieved and/or the date of an Award  Recipient's  termination
of employment due to death,  disability or retirement,  or following a Change in
Control.

                                   ARTICLE III

                                 ADMINISTRATION

      Section 3.1 Committee
                  ---------

            The Plan shall be administered by the Compensation  Committee of the
Board  (or any  successor  committee),  or such  other  committee  as  shall  be
designated  by or on behalf of the Board to perform the duties set forth in this
Article  III;  provided,  however,  that all members of such  Committee  must be
Disinterested  Board  Members.  If  fewer  than 2  members  of the  Compensation
Committee of the Board are  Disinterested  Board  Members,  then the Board shall
appoint to the Committee such additional Disinterested Board Members as shall be
necessary  to provide for a  Committee  consisting  of at least 2  Disinterested
Board Members.

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      Section 3.2 Committee Action
                  ----------------

            The Committee shall hold meetings,  at least annually,  and may make
such  administrative  rules and regulations as it may deem proper. A majority of
the members of the  Committee  shall  constitute  a quorum,  and the action of a
majority of the members of the Committee  present at a meeting at which a quorum
is present,  as well as actions taken pursuant to the unanimous  written consent
of all of the  members of the  Committee  without  holding a  meeting,  shall be
deemed to be actions of the  Committee.  All actions of the  Committee  shall be
final and  conclusive  and shall be binding upon the  Corporation  and all other
interested parties.

      Section 3.3 Committee Responsibilities
                  --------------------------

            Subject to the terms and conditions of the Plan and such limitations
as may be  imposed  from  time to time by the  Board,  the  Committee  shall  be
responsible for the overall  management and administration of the Plan and shall
have such  authority as shall be necessary or  appropriate in order to carry out
its responsibilities, including, without limitation, the authority:

                  (a) to  interpret,  construe and  implement  the Plan,  and to
determine  and  resolve  any and all  questions  that may arise  under the Plan,
Awards granted  pursuant to the Plan and the terms and conditions  thereof,  and
any  such  determinations,  interpretations  and  other  decisions  made  by the
Committee  under or with respect to the Plan or any Award  thereunder,  shall be
final,  conclusive  and binding  upon the  Corporation,  any Award  Recipient or
Beneficiary and any other Person having an interest in the Plan;

                  (b) to adopt rules and  regulations and to prescribe forms for
the operation and administration of the Plan;

                  (c) to appoint an officer, or officers,  of Haven or the Bank,
who  need  not be a member  of the  Committee,  and who  shall,  subject  to the
responsibilities  of the Committee and the Board, serve as the Administrator for
the  Plan  and  shall  have  the  responsibility  for  the  day-to-day  control,
management,  operation and administration of the Plan, including, subject to the
Committee's discretion, the following:

                        (i) maintaining records necessary or appropriate for the
administration of the Plan;

                        (ii) giving and receiving such instructions, notices and
information  as may be necessary or  appropriate  in the  administration  of the
Plan;

                        (iii) prescribing forms consistent with the terms of the
Plan and with the interpretations and other actions of the Committee;

                        (iv)  determining and resolving any question  arising in
connection with the Plan or an Award made thereunder,  and such  Administrator's
decision or action in respect  thereof shall be final and conclusive and binding
upon the Corporation,  the Award Recipients,  Beneficiaries and any other Person
having an interest under the Plan; provided, however, that any question relating
to inconsistency or omission in the Plan, or interpretation of the provisions of
the Plan,  shall be  referred to the  Committee  by the  Administrator,  and the
decision of the Committee in respect thereof shall be final;

                        (v) discharging  such other  responsibilities  or follow
such  directions as may be assigned or given by the Committee or the Board;  and
any Person dealing with the  Administrator  shall be fully  protected in relying
upon any written notice, instruction, direction or other communication signed by
the Administrator; and

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                        (d) to take any other action not  inconsistent  with the
provisions of the Plan that it may deem necessary or appropriate.

      Section 3.4  Indemnification
                   ---------------

            No member of the Committee or an  Administrator  shall be liable for
any action, omission, or determination relating to the Plan, and the Corporation
shall   indemnify  and  hold  harmless  each  member  of  the   Committee,   the
Administrator and each other director or employee of the Corporation to whom any
duty or power relating to the  administration  or interpretation of the Plan has
been delegated against any cost or expense (including counsel fees) or liability
(including  any sum  paid in  settlement  of a claim  with the  approval  of the
Committee) arising out of any action,  omission or determination relating to the
Plan,  unless, in either case, such action,  omission or determination was taken
or made by such member, director or employee in bad faith and without reasonable
belief that it was in the best interests of the Corporation.

                                        6

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                                   ARTICLE IV

                      AVAILABLE SHARES AND AWARD AGREEMENTS

      Section 4.1  Available Shares
                   ----------------

            Subject to Section 9.3, the maximum  aggregate number of Shares with
respect to which Options, Restricted Stock and Dividend Equivalent Rights may be
granted at any time pursuant to this Plan shall be equal to the excess of:

                  (a)   210,000 Shares; over

                  (b)   the sum of:

                        (i) the number of Shares with  respect to which  Options
previously  granted  under this Plan may then or may in the future be exercised;
plus

                        (ii) the number of Shares with respect to which  Options
previously granted under this Plan have been exercised; plus

                        (iii) the  number of Shares  that have been  granted  as
Restricted  Stock under this Plan which have become or may in the future  become
vested.

The Shares available  pursuant to this Section 4.1 may be either  authorized but
unissued Shares,  or Shares previously issued and reacquired by Haven to be held
as issued but not outstanding  Shares.  Solely for purposes of this Section 4.1:
(A) an Option  shall not be  considered  as having been  exercised  or remaining
exercisable  to the extent that such Option  terminates by reason other than the
purchase the related Shares,  (B) the exercise of an Appreciation  Right related
to an Option  shall be treated as a  termination,  but not an  exercise,  of the
related  Option and (C) Shares of Restricted  Stock that are forfeited  prior to
vesting shall be added to the number of Shares available under the Plan.

      Section 4.2 Option Agreements
                  -----------------

            Any Award  granted  pursuant  to the Plan  shall be  evidenced  by a
written agreement which shall:

            (a)  specify  the  number of Shares  covered by or  relating  to the
Award;

            (b) in the case of an  Option,  designate  the  Option  as either an
Incentive Stock Option or a Non-Qualified Stock Option;

            (c)   in the case of an Option or Appreciation Right:

                  (i) specify the Exercise  Price for the Shares  subject to the
Option or Appreciation Right;

                  (ii)   specify   the   Exercise   Period  for  the  Option  or
Appreciation Right;

                  (iii) specify any Dividend  Equivalent  Rights relating to the
Option or Appreciation Right;

                                      7

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            (d) specify the Vesting  Date or Vesting  Dates  applicable  to such
Award;

            (e)  set  forth  specifically,  or  incorporate  by  reference,  the
applicable provisions of the Plan; and

            (f) contain such other terms and  conditions not  inconsistent  with
the Plan as the Committee may, in its  discretion,  prescribe with respect to an
Award granted to an Eligible Individual.

                                    ARTICLE V

                                  STOCK OPTIONS

      Section 5.1   Options Granted to Eligible Individuals
                    ---------------------------------------

            (a) Subject to the  limitations  of the Plan,  the Committee may, in
its discretion, grant to an Eligible Individual an Option to purchase Shares.

            (b)  Subject to Section  4.1 and such  limitations  as the Board may
from time to time impose,  the number of Shares  subject to an Option granted to
an Eligible  Employee shall be determined by the Committee,  in its  discretion;
provided,  however,  that the maximum number of Shares that may be subject to an
Option  granted  to any  Eligible  Individual  during  the period the Plan is in
effect shall be 112,000.

            (c)  The  Exercise  Price  of  an  Option  granted  to  an  Eligible
Individual  shall be determined by the Committee,  in its discretion;  provided,
however,  that the Exercise  Price  established  for any Incentive  Stock Option
shall be determined in accordance with Section 5.5; and further  provided,  that
the  Exercise  Price  established  for any Option shall not be less than the par
value of a Share on the date on which the Option is granted.

            (d) The  Exercise  Period  during  which  an  Option  granted  to an
Eligible  Individual may be exercised,  and the Vesting Date or Vesting Dates on
and after which all or a specified  portion of the Shares  subject to the Option
may be purchased, shall be determined by the Committee, in its discretion.

            (e) The Committee may, in its discretion, establish such other terms
and conditions  with respect to an Option granted to an Eligible  Employee as it
may deem necessary or appropriate,  including,  without limitation, the grant of
related  Dividend  Equivalent  Rights,  which  terms  and  conditions  shall  be
specified in the Award Agreement evidencing such Option.

                                      8

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      Section 5.2 Options Granted to Eligible Directors
                  -------------------------------------

            (a) Subject to Section 4.1, effective as of the Effective Date, each
Eligible  Director  who is an Eligible  Director on such date shall be granted a
Non-Qualified  Stock Option to purchase  6,000 Shares.  An individual  who first
becomes an Eligible Director  subsequent to the Effective Date shall be granted,
effective on the date he or she becomes an Eligible  Director,  a  Non-Qualified
Stock Option to purchase 6,000 Shares.

            (b) The Exercise Price of an Option granted to an Eligible  Director
shall be the Fair  Market  Value of a Share on the date on which  the  Option is
granted.

            (c) The  Exercise  Period  during  which  an  Option  granted  to an
Eligible  Director may be exercised  shall commence on the first  anniversary of
the date the Option was granted and shall expire on the earliest of:

                  (i) the last day of the one-year period commencing on the date
the Eligible  Director  ceases to be an Eligible  Director,  other than due to a
termination for cause;

                  (ii) the date the Eligible  Director  ceases to be an Eligible
Director due to a termination for cause; and

                  (iii) the last day of the ten-year  period  commencing  on the
date on which the Option was granted;

provided,  however,  that in the event of an Eligible Director's  termination of
service due to Retirement  while there is outstanding any Option granted to such
Eligible Director for which the Exercise Period has not commenced,  the Exercise
Period  applicable  to  such  Option  shall  automatically  commence  as of  the
effective date of such Eligible  Director's  Retirement;  and further  provided,
that in the event of a Change in Control while there is  outstanding  any Option
granted to an Eligible Director for which the Exercise Period has not commenced,
the Exercise Period  applicable to such Option shall  automatically  commence on
the earliest date on which the Change in Control is deemed to have occurred.

            (d) The Vesting Dates applicable to an Option granted to an Eligible
Director pursuant to this Section 5.2 shall be:

                  (i) the first  anniversary  of the date the Option was granted
with respect to 2,000 of the unvested Shares subject to the Option;

                  (ii) the second anniversary of the date the Option was granted
with  respect  to an  additional  2,000 of the  unvested  Shares  subject to the
Option; and

                  (iii) the third anniversary of the date the Option was granted
with respect to the remaining 2,000 unvested Shares subject to the Option;

provided,  however,  that in the event of an Eligible Director's  termination of
service due to Retirement  while there is outstanding any Option granted to such
Eligible  Director  for which  the  applicable  Vesting  Date or  Vesting  Dates
specified  in this  Section  5.2(d) has not  occurred,  such Option shall become
fully vested as of the effective  date of such Eligible  Director's  Retirement;
and further  provided,  that in the event of a Change in Control  while there is
outstanding any Option granted to an Eligible Director for which the applicable

                                      9

<PAGE> 15

Vesting Date or Vesting Dates specified in this Section 5.2(d) has not occurred,
such Option shall become fully vested as of earliest date on which the Change in
Control is deemed to have occurred.

            (e) If an  Eligible  Director  granted  an Option  pursuant  to this
Section 5.2 ceases to be an Eligible  Director prior to a Vesting Date specified
in Section  5.2(d) for any reason  other than  Retirement  or a  termination  of
service  following  a Change in  Control,  any Option  granted to such  Eligible
Director that has not previously become vested shall be forfeited.

      Section 5.3   Method of Exercise
                    ------------------

            (a) Subject to the  limitations of the Plan and the Award  Agreement
evidencing  an Option,  the Option  Holder may, at any time during the  Exercise
Period,  exercise  his or her right to purchase all or any part of the Shares to
which the Option relates;  provided,  however, that the minimum number of Shares
which may be  purchased  shall be 100,  or, if less,  the total number of Shares
relating to the Option which remain unpurchased. An Option Holder shall exercise
an Option to purchase Shares by:

                  (i) giving written notice to the Committee or Administrator in
such form and manner as the  Committee  may  prescribe,  of his or her intent to
exercise the Option;

                  (ii) delivering to the Committee or Administrator full payment
for the Shares as to which the Option is to be exercised; and

                  (iii) satisfying such other conditions as may be prescribed in
the Award Agreement.

Payment for Shares to be purchased  upon exercise of an Option shall be made (A)
in United States dollars (by certified or bank check or such other instrument as
the Company may accept); (B) if and to the extent permitted by the Committee, in
the form of Shares already owned  beneficially by the Option Holder for a period
of more than six months and having an  aggregate  Fair Market  Value on the date
the Option is exercised equal to the aggregate Exercise Price to be paid; or (C)
by a  combination  of (A) and (B).  Payment for any Shares to be purchased  upon
exercise  of an  Option  may  also be made by  delivering  a  properly  executed
exercise  notice to the  Committee  or  Administrator,  together  with a copy of
irrevocable  instructions to a broker to deliver promptly to Haven the amount of
sale or loan proceeds to pay the Exercise  Price.  To facilitate  the foregoing,
Haven may enter into  agreements  for  coordinated  procedures  with one or more
brokerage  firms.  Notwithstanding  the  provisions of Section 10.9, the date of
exercise shall be the earliest date practicable  following the date on which the
notice  referred  to in this  Section  5.3(a) is received  by the  Committee  or
Administrator,  but in no event  more  than  three  days  after  such  notice is
received.

            (b) When the requirements of Section 5.3(a) have been satisfied, the
Committee or  Administrator  shall take such action as is necessary to cause the
issuance,  in the name of the  Option  Holder or such  individual  as the Option
Holder may designate,  of a stock  certificate  evidencing the ownership of such
Shares.  Except as may be provided  under  Article VIII with respect to Dividend
Equivalent  Rights,  an Option  Holder shall have no right to vote or to receive
dividends,  nor have any other rights with  respect to the Shares,  prior to the
date as of which such Shares are  transferred  to the Option Holder on the stock
transfer records of Haven, and no adjustments shall be made for any dividends or
other  rights  for which the  record  date is prior to the date as of which such
transfer is effected, except as may be required under Section 9.3.

                                      10

<PAGE> 16

      Section 5.4  Limitations on Options
                   ----------------------

            (a) No Eligible  Individual shall be granted an Option unless at the
time the Option is granted,  each  member of the  Committee  is a  Disinterested
Board Member.

            (b) An Option by its terms shall not be  transferable  by the Option
Holder  other  than by  will or by the  laws of  descent  and  distribution,  or
pursuant  to the terms of a Qualified  Domestic  Relations  Order,  and shall be
exercisable,  during the lifetime of an Option Holder only by such Option Holder
or an alternate  payee  designated  pursuant to a Qualified  Domestic  Relations
Order.

            (c) The  obligation  of Haven to deliver  Shares with  respect to an
Option shall, if the Committee or Administrator so requests, be conditioned upon
the receipt of a  representation  as to the  investment  intention of the Option
Holder to whom such Shares are to be delivered, in such form as the Committee or
Administrator  shall  determine  to be necessary or advisable to comply with the
provisions  of applicable  federal,  state or local law. It may be provided that
any such  representation  shall become  inoperative  upon a registration  of the
Shares or upon the  occurrence of any other event  eliminating  the necessity of
such representation. Haven shall not be required to deliver any Shares under the
Plan prior to (i) the admission of such Shares to listing on any stock  exchange
on which Shares may then be listed,  or (ii) the completion of such registration
or other qualification under any state or federal law, rule or regulation as the
Committee or Administrator shall determine to be necessary or advisable.

      Section 5.5 Additional Limitations on Incentive Stock Options

            In addition to the limitations of Section 5.4, an Option  designated
by the  Committee  to be an  Incentive  Stock  Option  shall be  subject  to the
following limitations:

            (a) if,  for any  calendar  year,  the sum of (i) plus (ii)  exceeds
$100,000,  where (i) equals the Fair Market Value  (determined as of the date of
the grant) of Shares  subject to an Option  intended  to be an  Incentive  Stock
Option which first become  available for purchase during such calendar year, and
(ii) equals the Fair Market Value (determined as of the date of grant) of Shares
subject  to any  other  Options  intended  to be  Incentive  Stock  Options  and
previously   granted  to  the  same  Eligible   Individual  which  first  become
exercisable  in such  calendar  year,  then that  portion of the Shares  granted
pursuant to such Options which cause the sum of (i) and (ii) to exceed  $100,000
shall be deemed to be Shares granted pursuant to a Non-Qualified Stock Option or
Non-Qualified  Stock  Options,  with the same  terms as the  Option  or  Options
intended to be an Incentive Stock Option;

            (b) the Exercise Price  established  for an Option intended to be an
Incentive  Stock Option shall not be less than the reported  closing  price of a
Share as reported by the National  Association of Securities  Dealers  Automated
Quotation System for the date the Option is granted; and

            (c) the Exercise Price  established  for an Option intended to be an
Incentive  Stock  Option that is granted to an Eligible  Individual  who, at the
time the Option is granted,  owns Shares  comprising  more than 10% of the total
combined  voting power of all classes of stock of Haven,  shall not be less than
110% of the  amount  determined  under  Section  5.5(b)  without  regard to this
Section 5.5(c).

                                   ARTICLE VI

                               APPRECIATION RIGHTS

      Section 6.1  Appreciation Rights Granted to Eligible Individuals
                   ---------------------------------------------------

                                      11

<PAGE> 17

            (a) Subject to the  limitations  of the Plan,  the Committee may, in
its discretion,  grant an  Appreciation  Right to an Eligible  Individual.  Such
Appreciation  Right may,  but shall not be  required  to, be related to all or a
portion of the  Shares  subject  to an Option  that is granted to such  Eligible
Individual simultaneously with the Appreciation Right.

            (b)  Subject to Section  4.1 and such  limitations  as the Board may
from time to time impose,  the number of Shares subject to an Appreciation Right
granted to an Eligible  Employee  shall be determined by the  Committee,  in its
discretion;  provided,  however,  that  the  number  of  Shares  subject  to  an
Appreciation  Right  that  relates  to an Option  shall not exceed the number of
Shares subject to such Option.

            (c) The  Exercise  Price  of an  Appreciation  Right  granted  to an
Eligible  Individual  shall be determined by the Committee,  in its  discretion;
provided, however, that the Exercise Price established for an Appreciation Right
that  relates to all or any  portion of an Option  shall be the  Exercise  Price
established for such Option.

            (d) The Exercise Period during which an  Appreciation  Right granted
to an Eligible  Individual  may be  exercised  and the  Vesting  Date or Vesting
Dates, if any, on and after which all or a specified portion of the Appreciation
Right may be exercised, shall be determined by the Committee, in its discretion;
provided,  however,  that the Exercise  Period  established  for an Appreciation
Right shall not commence prior to a Change in Control.

            (e) The Committee may, in its discretion, establish such other terms
and  conditions  with respect to an  Appreciation  Right  granted to an Eligible
Employee as it may deem necessary or appropriate, including, but not limited to,
the grant of related  Dividend  Equivalent  Rights,  which terms and  conditions
shall be specified in the Award Agreement evidencing such Appreciation Right.

      Section 6.2  Appreciation Rights Granted to Eligible Directors
                   -------------------------------------------------

            Each  Eligible  Director who has been granted an Option  pursuant to
Section  5.2 of the Plan  shall,  at the time the  Option  is  granted,  also be
granted an  Appreciation  Right  relating  to all of the Shares  subject to such
Option,  with an  Exercise  Price  equal to the  Exercise  Price of the  related
Option.  The Exercise Period applicable to such Appreciation  Right shall be the
same as for the related  Option;  provided,  however,  that such Exercise Period
shall not commence  prior to the  earliest  date on which a Change in Control is
deemed to have occurred.

      Section 6.3  Exercise of Appreciation Rights
                   -------------------------------

            (a) An Award  Recipient in possession of an  Appreciation  Right who
desires to exercise  such  Appreciation  Right shall do so by  delivering to the
Committee  or  Administrator  advance  written  notice,  in the form and  manner
prescribed by the Committee or  Administrator,  of his or her intent to exercise
the  Appreciation  Right  and the  number of Shares  with  respect  to which the
Appreciation  Right is to be  exercised.  Except as provided in section  6.3(c),
within  ten (10) days  after the giving of such a notice,  the  Committee  shall
cause Haven to deliver to the Award  Recipient  a monetary  payment in an amount
per  Share  equal to the  amount by which the  Change in  Control  Consideration
exceeds the Exercise  Price per Share of each of the  Appreciation  Rights being
exercised.

            (b) For  purposes  of  section  6.3(a),  the term  Change in Control
Consideration  shall mean the greater of (i) the highest price per Share paid by
any Person who  initiated  or sought to effect the Change in Control for a Share
during the period of one (1) year ending on the date of the  relevant  Change in
Control;

                                      12

<PAGE> 18

and (ii) the average Fair Market Value of a Share over the last ten (10) trading
days preceding the date of exercise of the Appreciation Right.

            (c) Notwithstanding  anything herein contained to the contrary,  the
Appreciation  Rights granted  hereunder shall be cancelled  immediately prior to
the effective time of a Change in Control  resulting from a transaction  between
the  Corporation and another party pursuant to a written  agreement  whereby the
consummation of the transaction is conditioned upon the availability of "pooling
of interests"  accounting  treatment (within the meaning of A.P.B. No. 16 or any
successor   thereto);   provided,   however,   that  the  cancellation  of  such
Appreciation Rights shall be subject to the following conditions:

                  (i) the  existence  of the  Appreciation  Rights would (in the
opinion  of the  firm of  independent  certified  public  accountants  regularly
engaged to audit the Corporation's  financial statements) render the transaction
ineligible for pooling of interests accounting treatment;

                  (ii) the cancellation of the Appreciation Rights would (in the
opinion  of the  firm of  independent  certified  public  accountants  regularly
engaged to audit the Corporation's  financial statements) render the transaction
eligible for pooling of interests accounting treatment; and

                  (iii) the transaction is, in fact, consummated.

      Section 6.4  Effect of Exercise
                   ------------------

            The  exercise of an  Appreciation  Right  which  relates to all or a
portion of an Option shall,  for all purposes of the Plan other than determining
the  amount of Shares  available  pursuant  to  Section  4.1,  be  treated as an
exercise of the related  Option and a subsequent  resale of the Shares  acquired
thereby.

                                      13

<PAGE> 19

                                   ARTICLE VII

                                RESTRICTED STOCK

      Section 7.1  Restricted Stock Granted to Eligible Individuals
                   ------------------------------------------------

            (a) Subject to the  limitations  of the Plan,  the Committee may, in
its discretion, grant Restricted Stock to an Eligible Individual.

            (b)  Subject to Section  4.1 and such  limitations  as the Board may
from time to time impose, the number of Shares of Restricted Stock granted to an
Eligible  Employee  shall be determined  by the  Committee,  in its  discretion;
provided,  however, that the maximum number of Shares that may be granted to any
Eligible  Individual as Restricted Stock during the period the Plan is in effect
shall be 28,000.

            (c) The  Vesting  Date or Vesting  Dates on which all or a specified
portion of the  Restricted  Stock  granted to an Award  Recipient  shall  become
transferable shall be determined by the Committee, in its discretion;  provided,
however,  that the  Vesting  Date or Vesting  Dates shall be at least six months
after the date of the grant of the Restricted Stock.

            (d) The Committee may, in its discretion, establish such other terms
and conditions with respect to Restricted Stock granted to an Eligible  Employee
as it may deem necessary or  appropriate,  which terms and  conditions  shall be
specified in the Award Agreement evidencing such Restricted Stock Award.

      Section 7.2  Restricted Stock Granted to Eligible Directors
                   ----------------------------------------------

            (a) Subject to Section 4.1,  effective as of the Effective  Date and
as of the first business day of each of the first four calendar years  beginning
after the  Effective  Date  ("Grant  Date"),  each  Eligible  Director who is an
Eligible Director on such date shall be granted a number of Shares of Restricted
Stock in lieu of receiving one-third of the Annual Retainer that would otherwise
be paid in cash to such  Eligible  Director for the  calendar  year in which the
Grant Date occurs.  The number of Shares of Restricted Stock to be granted to an
Eligible  Director on each Grant Date  pursuant to this Section  7.2(a) shall be
equal to the  dollar  value  of  one-third  of the  Eligible  Director's  Annual
Retainer  for the calendar  year in which the Grant Date occurs,  divided by the
Fair  Market  Value  of a Share  on the  effective  date of the  grant,  and any
fractional Shares resulting from such calculation shall be disregarded.

            (b) The Vesting  Date for  Restricted  Stock  awarded to an Eligible
Director pursuant to this Section 7.2 shall be the date that is six months after
the date the Restricted Stock is granted.

            (c) If an Award Recipient granted  Restricted Stock pursuant to this
Section 7.2 ceases to be an Eligible  Director prior to a Vesting Date specified
in Section 7.2(b) for any reason other than a termination of service following a
Change in Control or  Retirement,  any  Restricted  Stock  granted to such Award
Recipient that has not previously become vested shall be forfeited.

            (d) If an Award Recipient granted  Restricted Stock pursuant to this
Section  7.2 ceases to be an  Eligible  Director  due to  Retirement  prior to a
Vesting Date specified in Section 7.2(b),  any Restricted  Stock granted to such
Award Recipient that has not previously  become vested shall be deemed vested as
of the date of such Award Recipient's Retirement.

            (e) If,  following a Change in Control,  an Award Recipient  granted
Restricted Stock pursuant to this Section 7.2 ceases to be an Eligible  Director
prior to a Vesting Date specified in Section 7.2(b)

                                      14

<PAGE> 20

for any reason, other than for cause, any Restricted Stock granted to such Award
Recipient that has not previously become vested shall be deemed vested as of the
date such Award Recipient ceases to be an Eligible Director.

      Section 7.3 Stock Certificates
                  ------------------

            A stock certificate or stock  certificates  evidencing the Shares of
Restricted  Stock  granted  pursuant to this Article VII shall be  registered on
Haven's books in the name of the Award  Recipient as of the date the  Restricted
Stock is granted and shall bear a legend restricting the transferability of such
certificate  or  certificates  and referring to the terms,  conditions and other
restrictions,   including  forfeiture,   applicable  to  such  Shares.  Physical
possession or custody of such certificates shall be retained by Haven until such
time as such Shares become vested.

      Section 7.4  Shareholder Rights
                   ------------------

            Subsequent to the date Shares of Restricted  Stock have been granted
and prior to the date such Shares have become  vested and are  distributed,  the
Award  Recipient shall be entitled to vote the Shares and receive cash dividends
declared and paid with respect to such Shares.  Any stock dividends declared and
paid with respect to such Shares shall be  evidenced by a stock  certificate  or
certificates  registered  in the name of the Award  Recipient,  retained  in the
possession or custody of Haven, and made subject to the same restrictions, terms
and conditions as the Shares to which they pertain.  Such stock  dividends shall
become  vested and be  distributed  at the same time as the Shares to which they
pertain.

      Section 7.5  Distribution of Shares
                   ----------------------

            As soon as  practicable  following  the  Vesting  Date of  Shares of
Restricted  Stock  granted  pursuant to this Article VII,  Haven shall issue the
Award  Recipient a stock  certificate  evidencing  his  ownership  of the Shares
granted as Restricted  Stock and any  additional  Shares  attributable  to stock
dividends paid on such Restricted Stock prior to vesting.

                                  ARTICLE VIII

                           DIVIDEND EQUIVALENT RIGHTS

      Section 8.1  In General
                   ----------

            The Committee may provide that each Eligible Individual who has been
granted  an Option  or  Appreciation  Right  shall,  at the time  such  Award is
granted,  also be  granted a  Dividend  Equivalent  Right  relating  to all or a
portion of the Shares subject to such Option or the Shares with respect to which
the Appreciation Right relates.

      Section 8.2  Form of Dividend Equivalents
                   ----------------------------

            Dividend  Equivalent Rights granted under this Article VIII may take
the form of cash  payments  made  currently or credited to a memorandum  account
established for the Award Recipient to be distributed, with earnings, at a later
date,  adjustments  to the Exercise  Price  applicable,  or the number of Shares
subject,  to an  Award,  or the  distribution  or  crediting  of Shares or Share
equivalents,  subject to the limitations of Section 4.1. Any Dividend Equivalent
Rights  granted  pursuant  to  this  Article  VIII  shall  be  subject  to  such
restrictions, terms and conditions as the Committee may establish.

                                      15

<PAGE> 21

                                   ARTICLE IX

                            AMENDMENT AND TERMINATION

      Section 9.1  Termination
                   -----------

            The Board may suspend or  terminate  the Plan in whole or in part at
any time prior to the tenth  anniversary of the Effective Date by giving written
notice  of such  suspension  or  termination  to the  Committee.  Unless  sooner
terminated,  the Plan shall  terminate  automatically  on the day  preceding the
tenth  anniversary  of the  Effective  Date.  In the event of any  suspension or
termination of the Plan, all Awards theretofore  granted under the Plan that are
effective on the date of such suspension or termination of the Plan shall remain
effective under the terms of the applicable Award Agreements.

      Section 9.2  Amendment
                   ---------

            The Board  may  amend or revise  the Plan in whole or in part at any
time; provided, however, that if the amendment or revision:

            (a)   materially increases the benefits accruing under the Plan;

            (b)   materially increases  the number of Shares which may be issued
under the Plan; or

            (c)   materially  modifies  the  requirements  as to eligibility for
Options, Appreciation Rights or Dividend Equivalent Rights under the Plan;

such amendment or revision shall be subject to approval by the  shareholders  of
Haven; and further provided, that sections 5.2, 6.2 and 7.2 shall not be amended
more  than once  every  six  months  other  than to comply  with the Code or the
Employee  Retirement Income Security Act of 1974, as amended, or the regulations
thereunder.

      Section 9.3  Adjustments for Business Reorganization, Stock Split or Stock
                   -------------------------------------------------------------
Dividend
--------

            (a)  Subject  to  Section  6.3(c),  in  the  event  of  any  merger,
consolidation,  or other business reorganization in which Haven is the surviving
entity,  and in the event of any stock  split,  stock  dividend  or other  event
generally  affecting  the  number of Shares  held by each  Person  who is then a
holder of Shares on the record date for such event, the number of Shares covered
by each  outstanding  Award and the number of Shares available under Section 4.1
shall be adjusted to account for such event.  The adjustment to be made pursuant
to this Section 9.3 for  outstanding  Options and  Appreciation  Rights shall be
effected  by  multiplying  the  number  of  Shares  then  covered  by each  such
outstanding  Option or  Appreciation  Right by an amount  ("Adjustment  Amount")
equal to the number of Shares  that would be owned  after such event by a Person
who, immediately prior to such event, was the holder of record of one Share, and
the Exercise Price for such  outstanding  Option or Appreciation  Right shall be
adjusted by dividing  the Exercise  Price by the  Adjustment  Amount;  provided,
however,   that  the  Committee  may,  in  its  discretion,   establish  another
appropriate method of adjusting outstanding Options and Appreciation Rights. The
adjustment to be made to the number of Shares  relating to other types of Awards
and the  number of Shares  available  under  Section  4.1 shall be  effected  by
multiplying the number of such Shares by the Adjustment Amount.

            (b)  Subject  to  Section  6.3(c),  in  the  event  of  any  merger,
consolidation,  or  other  business  reorganization  in  which  Haven is not the
surviving entity:

                                      16

<PAGE> 22

                  (i) any Awards granted under the Plan which remain outstanding
may be  cancelled  by the  Committee  as of the  effective  date of such merger,
consolidation, business reorganization, liquidation or sale by the Board upon 30
days' written notice to each Award Recipient in advance of the effective date of
such  event and the Award  Recipient  shall  receive  in  consideration  of such
cancellation  an  amount  in cash  equal  to the  excess  of (A) the  value,  as
determined  by  the  Committee  in its  absolute  discretion,  of  the  property
(including  cash)  received  by the  holder of a Share as a result of such event
over (B) the Exercise Price of such Award, if any; and

                  (ii) any Award  which is not  cancelled  pursuant  to  Section
9.3(b)(i)  shall be exchanged or adjusted in such manner as the Committee  shall
deem  appropriate,  in its  absolute  discretion,  to account  for such  merger,
consolidation  or  other  business  reorganization  and,  if  appropriate,   the
Committee may provide, in its absolute  discretion,  that a cash payment will be
made to the Award  Recipient in  connection  with such exchange or adjustment of
the Award.

                                    ARTICLE X

                                  MISCELLANEOUS

      Section 10.1  Status as an Employee Benefit Plan
                    ----------------------------------

            This  Plan  is  not  intended  to  satisfy  the   requirements   for
qualification  under Section  401(a) of the Code or to satisfy the  definitional
requirements  for an "employee  benefit plan" under Section 3(3) of the Employee
Retirement  Income  Security  Act of 1974,  as  amended.  It is intended to be a
non-qualified  incentive compensation program that is exempt from the regulatory
requirements of the Employee Retirement Income Security Act of 1974, as amended.
The Plan shall be construed and administered so as to effectuate this intent.

      Section 10.2  No Right to Continued Employment or Board Membership
                    ----------------------------------------------------

            Neither the establishment of the Plan nor any provisions of the Plan
nor any action of the Board or the  Committee  with respect to the Plan shall be
held or construed to confer upon any Eligible  Individual  or Eligible  Director
any right to a continuation  of employment by the Corporation or continuation of
membership  on the  Board or board of  directors  of the Bank.  The  Corporation
reserves the right to dismiss any Eligible Individual or otherwise deal with any
Eligible Individual to the same extent as though the Plan had not been adopted.

      Section 10.3 Construction of Language
                   ------------------------

            Whenever  appropriate in the Plan, words used in the singular may be
read in the plural,  words used in the plural may be read in the  singular,  and
words  importing  the masculine  gender may be read as referring  equally to the
feminine or the neuter.  Any  reference  to an Article or Section  number  shall
refer to an Article or Section of this Plan unless otherwise indicated.

      Section 10.4  Governing Law
                    -------------

            The Plan shall be construed,  administered and enforced according to
the laws of the State of Delaware  without giving effect to the conflict of laws
principles thereof, except to the extent that such laws are preempted by federal
law.

                                      17

<PAGE> 23

      Section 10.5  Headings
                    --------

            The  headings of  Articles  and  Sections  are  included  solely for
convenience of reference. If there is any conflict between such headings and the
text of the Plan, the text shall control.

      Section 10.6  Non-Alienation of Benefits
                    --------------------------

            The right to  receive a benefit  under the Plan shall not be subject
in any manner to anticipation, alienation or assignment, nor shall such right be
liable for or subject to debts, contracts, liabilities, engagements or torts.

      Section 10.7  Taxes
                    -----

            The Corporation shall have the right to deduct from all amounts paid
by the  Corporation in cash with respect to an Award,  any taxes required by law
to be  withheld  with  respect to such  Award.  Where any Person is  entitled to
receive Shares  pursuant to an Award,  the  Corporation  shall have the right to
require  such  Person  to pay the  Corporation  the  amount of any tax which the
Corporation  is required to withhold  with respect to such  Shares,  or, in lieu
thereof,  to retain, or to sell without notice, a sufficient number of Shares to
cover the amount required to be withheld.  The Corporation may consider,  but is
not  required  to grant,  a request by the  Person  entitled  to receive  Shares
subject to withholding as to the manner in which such withholding shall be made.

      Section 10.8  Approval of Shareholders
                    ------------------------

            All  Awards  granted  under this Plan  shall be  conditioned  on the
approval of the Plan by the shareholders of Haven on or prior to the date of the
first annual meeting of such shareholders  immediately following the adoption of
the Plan by Haven. No Award granted under the Plan shall be effective, nor shall
any Option or Appreciation  Right be exercised or any Shares issued or purchased
pursuant to the Plan, prior to such approval.

      Section 10.9  Notices
                    -------

            Any communication  required or permitted to be given under the Plan,
including any notice, direction, designation, comment, instruction, objection or
waiver,  shall be in writing and shall be deemed to have been given at such time
as it is delivered personally or five (5) days after mailing if mailed,  postage
prepaid, by registered or certified mail, return receipt requested, addressed to
such party at the address  listed  below,  or at such other  address as one such
party may by written notice specify to the other party:

            (a)   If to the Committee:

                  Haven Bancorp, Inc.
                  93-22 Jamaica Avenue
                  Woodhaven, New York  11421

                  Attention: Administrator of the Haven Bancorp, Inc. 1996 Stock
Incentive Plan

            (b)   If  to  an  Award  Recipient,  to  the address as shown in the
Corporation's personnel records.

                                      18<PAGE> 1

EXHIBIT 10.2      HAVEN BANCORP, INC. INCENTIVE STOCK OPTION PLAN

<PAGE> 2

                              AMENDED AND RESTATED
                             AS OF FEBRUARY 23, 1995

                               HAVEN BANCORP, INC.
                           INCENTIVE STOCK OPTION PLAN
                           ---------------------------

1.   PURPOSE.  The purpose of the Amended and Restated  Haven  Bancorp,  Inc.
     -------
(the "Holding Company") Incentive Stock Option Plan (the "Plan") is to advance
the interests of the Holding Company and its shareholders by providing those key
employees of the Holding Company and its Affiliates, including Columbia Federal
Savings Bank (the "Bank"), upon whose judgment, initiative and efforts the
successful conduct of the business of the Holding Company and its affiliates
largely depends, with additional incentive to perform in a superior manner. A
purpose of the Plan is also to attract people of experience and ability to the
service of the Holding Company and its Affiliates.

2.    DEFINITIONS.
      -----------

      (a) "Affiliate" means (i) a member of a controlled group of corporations
of which the Holding Company is a member or (ii) an unincorporated trade or
business which is under common control with the Holding Company as determined in
accordance with Section 414(c) of the Internal Revenue Code of 1986, as amended,
(the "Code") and the regulations issued thereunder. For purposes hereof, a
"controlled group of corporations" shall mean a controlled group of corporations
as defined in Section 1563(a) of the Code determined without regard to Section
1563(a)(4) and (e)(3)(C).

      (b) "Award" means a grant of Non-statutory Stock Options, Incentive Stock
Options, and/or Limited Rights under the provisions of this Plan.

      (c) "Board of Directors" or "Board" means the board of directors of the
Holding Company.

      (d) "Change in Control" for purposes of this Plan, a "Change in Control"
of the Bank or Company shall mean an event of a nature that: (i) would be
required to be reported in response to Item 1 of the current report on Form 8-K,
as in effect on the date hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the "Exchange Act"); or (ii) results in a
Change in Control of the Bank or the Holding Company within the meaning of the
Home Owners' Loan Act, as amended, the Federal Deposit Insurance Act and the
Rules and Regulations promulgated by the Office of Thrift Supervision ("OTS")
(or its predecessor agency), as in effect on the date hereof (provided, that in
applying the definition of change in control as set forth under the Rules and
Regulations of the OTS, the Board shall substitute its judgment for that of the
OTS); or (iii) without limitation such a Change in Control shall be deemed to
have occurred at such time as (A) any "person" (as the term is used in Sections
13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Bank or the Company representing 20% or more of the Bank's or
the Company's outstanding securities except for any securities of the Bank
purchased by the Company in connection with the conversion of the Bank to the
stock form and any securities purchased by the Bank's employee stock ownership
plan and trust; or (B) individuals

<PAGE> 3

who constitute the Board on the date hereof (the "Incumbent Board") cease for
any reason to constitute at least a majority thereof, provided that any person
becoming a director subsequent to the date hereof whose election was approved by
a vote of at least three-quarters of the directors comprising the Incumbent
Board, or whose nomination for election by the Company's stockholders was
approved by the same Nominating Committee serving under an Incumbent Board,
shall be, for purposes of this clause (B), considered as though he were a member
of the Incumbent Board; or (C) a plan of reorganization, merger, consolidation,
sale of all or substantially all the assets of the Bank or the Company or
similar transaction occurs in which the Bank or Company is not the resulting
entity.

      (e) "Committee" means a committee consisting of non-employee members of
the Board of Directors, all of whom are "disinterested directors" as such term
is defined under Rule 16b-3 under the Exchange Act, as amended, as promulgated
by the Securities and Exchange Commission.

      (f) "Common Stock" means the Common Stock of the Holding Company, par
value, $.01 per share.

      (g) "Date of Grant" means the date an Award granted by the Committee is
effective pursuant to the terms hereof.

      (h) "Disability" means the permanent and total inability by reason of
mental or physical infirmity, or both, of an employee to perform the work
customarily assigned to him. Additionally, a medical doctor selected or approved
by the Board of Directors must advise the Committee that it is either not
possible to determine when such Disability will terminate or that it appears
probable that such Disability will be permanent during the remainder of said
participant's lifetime.

      (i) "Fair Market Value" means, when used in connection with the Common
Stock on a certain date, the average of the reported bid and ask price of the
Common Stock as reported by the National Association of Securities Dealers
Automated Quotation System (as published by the Wall Street Journal, if
published) on such date or if the Common Stock was not traded on such date, on
the next preceding day on which the Common Stock was traded thereon or the last
previous date on which a sale is reported. For purposes of the grant of options
in the conversion of the Bank, Fair Market Value shall mean the initial public
offering price of the Common Stock which was $10.00 per share.

      (j) "Incentive Stock Option" means an Option granted by the Committee to a
Participant, which Option is designed as an Incentive Stock Option pursuant to
Section 8.

      (k) "Limited Right" means the right to receive an amount of cash based
upon the terms set forth in Section 9.

      (l) "Non-statutory Stock Option" means an Option granted by the Committee
to a participant and which is not designated by the Committee as an Incentive
Stock Option.

                                       2

<PAGE> 4

      (m) "Normal Retirement" means retirement at the normal or early retirement
date as set forth in any tax-qualified retirement/pension plan of the Bank.

      (n) "Option" means Award granted under Section 7 or Section 8.

      (o) "Participant" means an employee of the Holding Company or its
affiliates chosen by the Committee to participate in the Plan.

      (p) "Plan Year(s)" means a calendar year or years commencing on or after
January 1, 1993.

      (q) "Termination for Cause" means the termination upon an intentional
failure to perform stated duties, breach of a fiduciary duty involving personal
dishonesty, which results in material loss to the Holding Company or one of its
affiliates or willful violation of any law, rule or regulation (other than
traffic violations or similar offenses) or final cease-and-desist order which
results in material loss to the Holding Company or one of its affiliates.

3.    ADMINISTRATION.
      --------------

      The Plan shall be administered by the Committee. The Committee is
authorized, subject to the provisions of the Plan, to establish such rules and
regulations as it sees necessary for the proper administration of the Plan and
to make whatever determinations and interpretations in connection with the Plan
it sees as necessary or advisable. All determinations and interpretations made
by the Committee shall be binding and conclusive on all Participants in the Plan
and on their legal representatives and beneficiaries.

4.    TYPES OF AWARDS.
      ---------------

      Awards under the Plan may be granted in any one or a combination of:

      (a)   Non-statutory Stock Options;
      (b)   Incentive Stock Options; and
      (c)   Limited Rights

as defined below in paragraphs 7 through 9 of the Plan.

5.    STOCK SUBJECT TO THE PLAN.
      -------------------------

      Subject to adjustment as provided in Section 14, the maximum number of
shares reserved for purchase pursuant to the exercise of options granted under
the Plan shall not exceed 381,871 shares of Common Stock of the Holding Company,
par value $.01 per share, subject to adjustments pursuant to this Section 5 and
Section 14. These shares of Common Stock may be either authorized but unissued
shares or shares previously issued and reacquired by the Holding Company. To the
extent that options or Limited Rights are granted under the Plan, the shares
underlying such options will be unavailable for future grants under the Plan
except that, to the extent that options together with any related Limited Rights
granted under the Plan terminate,

                                       3

<PAGE> 5

expire or are canceled  without  having been  exercised  (in the case of Limited
Rights, exercised for cash) new awards may be made with respect to these shares.

6.    ELIGIBILITY.
      -----------

      Officers and other employees of the Holding Company or its affiliates
shall be eligible to receive Incentive Stock Options, Non-statutory Stock
Options and/or Limited Rights under the Plan. Directors who are not employees or
officers of the Holding Company or its affiliates shall not be eligible to
receive Awards under the Plan.

7.    NON-STATUTORY STOCK OPTIONS.
      ---------------------------

      7.1   Grant of Non-statutory Stock Options.
            ------------------------------------

      The Committee may, from time to time, grant Non-statutory Stock Options to
eligible employees and, upon such terms and conditions as the Committee may
determine, grant Non- statutory options in exchange for and upon surrender of
previously granted Awards under this Plan. Non-statutory Stock Options granted
under this Plan are subject to the following terms and conditions:

      (a) Price. The purchase price per share of Common Stock deliverable upon
          -----
the exercise of each Non-statutory Stock Option shall be determined by the
Committee on the date the option is granted. In general, such purchase price
shall not be less than 100% of the Fair Market Value of the Holding Company's
Common Stock on the Date of Grant, but in no event may the purchase price of any
non-statutory stock option be less than the par value of the Common Stock.
Shares may be purchased only upon full payment of the purchase price. Payment of
the purchase price may be made, in whole or in part, through the surrender of
shares of the Common Stock of the Holding Company at the Fair Market Value of
such shares on the date of surrender determined in the manner described in
Section 2(i).

      (b) Terms of Options. The term during which each Non-statutory Stock
          ----------------
Option may be exercised shall be determined by the Committee, but in no event
shall a Non-statutory Stock Option be exercisable in whole or in part more than
10 years from the Date of Grant. The Committee shall determine the date on which
each Non-statutory Stock Option shall become exercisable and may provide that a
Non-statutory Stock Option shall become exercisable in installments. The shares
comprising each installment may be purchased in whole or in part at any time
after such installment becomes purchasable. The Committee may, in its sole
discretion, accelerate the time at which any Non-statutory Stock Option may be
exercised in whole or in part. Notwithstanding the above, in the event of a
Change in Control of the Holding Company, all Non-statutory Stock Options shall
become immediately exercisable.

      (c) Termination of Employment. Unless otherwise determined by the
          -------------------------
Committee, upon the termination of a Participant's service for any reason other
than Disability, Normal Retirement, Change in Control, death or Termination for
Cause, the Participant's Non-statutory Stock Options shall be exercisable only
as to those shares which were immediately exercisable by the Participant at the
date of termination and only for a period of three months following

                                       4

<PAGE> 6

termination. In the event of Termination for Cause, all rights under the
Participant's Non-statutory Stock Options shall expire upon termination. Unless
otherwise determined by the Committee, in the event of the death, termination of
service as a result of Disability or Change in Control or Normal Retirement of
any Participant, all Non-statutory Stock Options held by the Participant,
whether or not exercisable at such time, shall be exercisable by the Participant
or his legal representatives or beneficiaries of the Participant for one year or
such longer period as determined by the Committee following the date of the
Participant's death, Normal Retirement or cessation of employment due to
Disability or Change in Control, provided that in no event shall the period
extend beyond the expiration of the Non-statutory Stock Option term.

8.    INCENTIVE STOCK OPTIONS.
      -----------------------

      8.1   Grant of Incentive Stock Options
            --------------------------------

      The Committee may, from time to time, grant Incentive Stock Options to
eligible employees. Incentive Stock Options granted pursuant to the Plan shall
be subject to the following terms and conditions:

      (a) Price. The purchase price per share of Common Stock deliverable upon
          -----
the exercise of each Incentive Stock Option shall be not less than 100% of the
Fair Market Value of the Holding Company's Common Stock on the Date of Grant.
However, if a Participant owns stock possessing more than 10% of the total
combined voting power of all classes of Common Stock of the Holding Company, the
purchase price per share of Common Stock deliverable upon the exercise of each
Incentive Stock Option shall not be less than 110% of the Fair Market Value of
the Holding Company's Common Stock on the Date of Grant. Shares may be purchased
only upon payment of the full purchase price. Payment of the purchase price may
be made, in whole or in part, through the surrender of shares of the Common
Stock of the Holding Company at the Fair Market Value of such shares on the date
of surrender determined in the manner described in Section 2(i).

      (b) Amounts of Options. Incentive Stock Options may be granted to any
          ------------------
eligible employee in such amounts as determined by the Committee. In the case of
an option intended to qualify as an Incentive Stock Option, the aggregate Fair
Market Value (determined as of the time the option is granted) of the Common
Stock with respect to which Incentive Stock Options granted are exercisable for
the first time by the Participant during any calendar year (under all plans of
the Participant's employer corporation and its parent and subsidiary
corporations) shall not exceed $100,000. The provisions of this Section 8.1(b)
shall be construed and applied in accordance with Section 422(d) of the Code and
the regulations, if any, promulgated thereunder. To the extent an award under
this Section 8.1 exceeds this $100,000 limit, the portion of the award in excess
of such limit shall be deemed a Non-statutory Option.

      (c) Terms of Options. The term during which each Incentive Stock Option
          ----------------
may be exercised shall be determined by the Committee, but in no event shall an
Incentive Stock Option be exercisable in whole or in part more than 10 years
from the Date of Grant. If at the time an Incentive Stock Option is granted to
an employee, the employee owns Common Stock representing more than 10% of the
total combined voting power of the Holding Company (or,

                                       5

<PAGE> 7

under Section 424(d) of the Code, is deemed to own Common Stock representing
more than 10% of the total combined voting power of all such classes of Common
Stock, by reason of the ownership of such classes of Common Stock, directly or
indirectly, by or for any brother, sister, spouse, ancestor or lineal descendent
of such employee, or by or for any corporation, partnership, estate or trust of
which such employee is a shareholder, partner or beneficiary), the Incentive
Stock Option granted to such employee shall not be exercisable after the
expiration of five years from the Date of Grant. No Incentive Stock Option
granted under this Plan is transferable except by will or the laws of descent
and distribution and is exercisable in this lifetime only by the employee to
whom it is granted.

      The Committee shall determine the date on which each Incentive Stock
Option shall become exercisable and may provide that an Incentive Stock Option
shall become exercisable in installments. The shares comprising each installment
may be purchased in whole or in part at any time after such installment becomes
purchasable, provided that the amount able to be first exercised in a given year
is consistent with the terms of Section 422 of the Code. The Committee may, in
its sole discretion, accelerate the time at which any Incentive Stock Option may
be exercised in whole or in part, provided that it is consistent with the terms
of Section 422 of the Code. Notwithstanding the above, in the event of a Change
in Control of the Holding Company, all Incentive Stock Options shall become
immediately exercisable.

      (d) Termination of Employment. Unless otherwise determined by the
          -------------------------
committee, upon the termination of a Participant's service for any reason other
than Disability, Normal Retirement, Change in Control, death or Termination for
Cause, the Participant's Incentive Stock Options shall be exercisable only as to
those shares which were immediately purchasable by the Participant at the date
of termination and only for a period of three months following termination. In
the event of Termination for Cause all rights under the Participant's Incentive
Stock Options shall expire upon termination.

      Unless otherwise determined by the committee, in the event of death or
termination of service as a result of Disability of any employee, all Incentive
Stock Options held by the Participant, whether or not exercisable at such time,
shall be exercisable by the Participant or the Participant's legal
representatives or beneficiaries for one year or such longer period as
determined by the Committee following the date of the Participant's death or
cessation of employment due to Disability. Upon termination of the Participant's
service due to Normal Retirement, or a Change in Control, all Incentive Stock
Options held by such Participant, whether or not exercisable at such time, shall
be exercisable for a period of one year or such longer period as determined by
the Committee following the date of Participant's cessation of employment,
provided however, that such option shall not be eligible for treatment as an
Incentive Stock Option in the event such option is exercised more than three
months following the date of the Participant's Normal Retirement or a Change of
Control. In no event shall the exercise period extend beyond the expiration of
the Incentive Stock Option term.

      (e) Compliance with Code. The options granted under this Section 8 of the
          --------------------
Plan are intended to qualify as incentive stock options within the meaning of
Section 422 of the Code, but the Company makes no warranty as to the
qualification of any option as an incentive stock option within the meaning of
Section 422 of the Code.

                                       6

<PAGE> 8

9.    LIMITED RIGHTS.
      --------------

      9.1   Grant of Limited Rights.
            -----------------------

      Simultaneously with the grant of any option, the Committee may grant a
Limited Right with respect to all or some of the shares covered by such option.
Limited Rights granted under this Plan are subject to the following terms and
conditions:

      (a) Terms of Rights. In no event shall a Limited Right be exercisable in
          ---------------
whole or part before the expiration of six months from the Date of Grant of the
Limited Right. A Limited Right may be exercised only in the event of a Change in
Control of the Holding Company.

      The Limited Right may be exercised only when the underlying option is
eligible to be exercised, and only when the Fair Market Value of the underlying
shares on the day of exercise is greater than the exercise price of the related
option.

      Upon exercise of a Limited Right, the related option shall cease to be
exercisable. Upon exercise or termination of an option, any related Limited
Rights shall terminate. The Limited Rights may be for no more than 100% of the
difference between the exercise price and the Fair Market Value of the Common
Stock subject to the underlying option. The Limited Right is transferable only
when the underlying option is transferable and under the same conditions.

      (b) Payment. Upon exercise of a Limited Right, the holder shall promptly
          -------
receive from the Holding Company an amount of cash equal to the difference
between the Fair Market value on the Date of Grant of the related option and the
Fair Market Value of the underlying shares on the date the Limited Right is
exercised, multiplied by the number of shares with respect to which such Limited
Right is being exercised.

      (c) Termination of Employment. Upon the termination of a Participant's
          -------------------------
service for any reason other than Termination for Cause, any Limited Rights held
by the Participant shall then be exercisable for a period of one year following
termination. In the event of Termination for Cause, all Limited Rights held by
the Participant shall expire immediately. Upon termination of the Participant's
employment for reason of death, Normal Retirement or Disability, all Limited
Rights held by such Participant shall be exercisable by the Participant or the
Participant's legal representative or beneficiaries for a period of one year
from the date of such termination. In no event shall the period extend beyond
the expiration of the term of the related option.

10.   SURRENDER OPTION.
      ----------------

      In the event of a Participant's termination of employment as a result of
death, disability or Normal Retirement, the Participant (or the Participant's
personal representative(s), heir(s), or devisee(s)) may, in a form acceptable to
the Committee make application to surrender all or part of options held by such
Participant in exchange for a cash payment from the Holding Company of an amount
equal to the difference between the Fair Market Value of the Common Stock on the
date of termination of employment and the exercise price per share of the option
on the Date of Grant. Whether the Committee accepts such application or
determines to make payment, in

                                       7

<PAGE> 9

whole or part, is within its absolute and sole discretion, it being expressly
understood that the Committee is under no obligation to any Participant
whatsoever to make such payments. In the event that the Committee accepts such
application and the Company determines to make payment, such payment shall be in
lieu of the exercise of the underlying option and such option shall cease to be
exercisable.

11.   RIGHTS OF A SHAREHOLDER:  NONTRANSFERABILITY.
      --------------------------------------------

      No Participant shall have any rights as a shareholder with respect to any
shares covered by a Non-statutory and/or Incentive Stock Option until the date
of issuance of a stock certificate for such shares. Nothing in this Plan or in
any Award granted confers on any person any right to continue in the employ of
the Holding Company or its Affiliates or to continue to perform services for the
Holding Company or its Affiliates or interferes in any way with the right of the
Holding Company or its Affiliates to terminate a Participant's services as an
officer or other employee at any time.

      No Award under the Plan shall be transferable by the optionee other than
by will or the laws of descent and distribution and may only be exercised during
his lifetime by the optionee, or by a guardian or legal representative.

12.   AGREEMENT WITH GRANTEES.
      -----------------------

      Each Award of Options, and/or Limited Rights will be evidenced by a
written agreement, executed by the Participant and the Holding Company or its
Affiliates which describes the conditions for receiving the Awards including the
date of Award, the purchase price if any, applicable periods, and any other
terms and conditions as may be required by the Board of Directors or applicable
securities law.

13.   DESIGNATION OF BENEFICIARY.
      --------------------------

      A Participant may, with the consent of the Committee, designate a person
or persons to receive, in the event of death, any stock option or Limited Rights
Award to which the Participant would then be entitled. Such designation will be
made upon forms supplied by and delivered to the Holding Company and may be
revoked in writing. If a Participant fails effectively to designate a
beneficiary, then the Participant's estate will be deemed to be the beneficiary.

14.   DILUTION AND OTHER ADJUSTMENTS.
      ------------------------------

      In the event of any change in the outstanding shares of Common Stock of
the Holding Company by reason of any stock dividend or split, recapitalization,
merger, consolidation, spin- off, reorganization, combination or exchange of
shares, or other similar corporate change, or other increase or decrease in such
shares without receipt or payment of consideration by the Company, the Committee
will make such adjustments to previously granted Awards, to prevent dilution or
enlargement of the rights of the Participant, including any or all of the
following:

                                       8

<PAGE> 10

      (a)   adjustments  in  the aggregate  number or kind of shares of Common
            Stock which may be awarded under the Plan;

      (b)   adjustments  in  the aggregate number or kind of shares of Common
            Stock covered by Awards already made under the Plan;

      (c)   adjustments in the purchase price of  outstanding  Incentive  and/or
            Non-statutory  Stock Options, or any Limited Rights attached to such
            options.

      No such adjustments may, however, materially change the value of benefits
available to a Participant under a previously granted Award.

15.   TAX WITHHOLDING.
      ---------------

      There shall be deducted from each distribution of cash and/or Common Stock
under the Plan the amount required by any governmental authority to be withheld
for income tax purposes. If this Plan, is qualified under 17 C.F.R. Section
240.16b-3 of the Exchange Act Rules, then any withholding shall comply with 17
C.F.R. Section 240.16b-3 (e).

16.   AMENDMENT OF THE PLAN.
      ---------------------

      The Board of Directors may at any time, and from time to time, modify or
amend the Plan in any respect; provided that if it has been determined to
continue to qualified the Plan under the Securities and Exchange Commission Rule
16b-3, shareholder approval shall be required for any such modification or
amendment which:

      (a)   materially  increases the maximum number of shares for which options
            may be granted under the Plan (subject,  however,  to the provisions
            of Section 14 hereof);

      (b)   reduces the exercise price at which Awards may be granted subject,
            however, to the provisions of Section 14 hereof);

      (c)   extends the period during which options may be granted or exercised
            beyond the times originally prescribed; or

      (d)   changes the persons eligible to participate in the Plan.

      Failure to ratify or approve amendments or modifications to subsections
(a) through (d) of this Section by shareholders shall be effective only as to
the specific amendment or modification requiring such ratification. Other
provisions, sections, and subsections of this Plan will remain in full force and
effect.

      No such termination, modification or amendment may affect the rights of a
Participant under an outstanding Award.

                                       9

<PAGE> 11

17.   EFFECTIVE DATE OF PLAN.
      ----------------------

      The Plan shall become effective upon the consummation of the conversion of
Columbia Federal Savings Bank from the mutual to capital stock form of ownership
(the "Effective Date") on September 23, 1993. The Plan will be presented to
shareholders of the Holding Company for ratification for purposes of: (i)
obtaining favorable treatment under Section 16(b) of the Securities Exchange Act
of 1934; (ii) satisfying one of the requirements of Section 422 of the Code
governing the tax treatment for Incentive Stock Options; and (iii) maintaining
listing on the Nasdaq National Market. The failure to obtain shareholder
ratification will not effect the validity of the Plan and the options
thereunder, provided, however, that if the Plan is not ratified, the Plan shall
remain in full force and effect, and any Incentive Stock Options granted under
the Plan shall be deemed to be Non-statutory Stock Options.

18.   TERMINATION OF THE PLAN.
      -----------------------

      The right to grant Awards under the Plan will terminate upon the earlier
of ten (10) years after the Effective Date of the Plan or the issuance of Common
Stock or the exercise of options or related Limited Rights equivalent to the
maximum number of shares reserved under the Plan as set forth in Section 5. The
Board of Directors has the right to suspend or terminate the Plan at any time,
provided that no such action will, without the consent of a Participant,
adversely affect his rights under a previously granted Award.

19.   APPLICABLE LAW.
      --------------

      The Plan will be administered in accordance with the laws of the State of
Delaware to the extent not preempted by Federal law.

20.   COMPLIANCE WITH SECTION 16.
      --------------------------

      If this Plan is qualified under 17 C.F.R. Section 240.16b-3 of the
Exchange Act Rules, with respect to persons subject to Section 16 of the
Exchange Act, transactions under this Plan are intended to comply with all
applicable conditions of Rule 16b-3 or its successors under the Exchange Act. To
the extent any provisions of the Plan or action by the Committee fail to so
comply, it shall be deemed null and void to the extent permitted by law and
deemed advisable by the Committee.

ADOPTED BY THE BOARD OF DIRECTORS:

________________________________                ________________________________
Date                                            Joseph W. Rennhack
                                                Secretary

                                       10

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