2002 STOCK OPTION PLAN

HUDSON UNITED BANCORP

2002 STOCK OPTION PLAN

The purposes of the 2002 Stock Option Plan are (i) to attract and retain highly-qualified executives, (ii) to align executive and stockholder long-term interests by creating a direct link between executive compensation and stockholder return, (iii) to enable executives of Hudson United Bancorp (the “Corporation”) to develop and maintain stock ownership positions in the Corporation, and (iv) to provide incentives to such executives to contribute to the success of the Corporation. To achieve these objectives, the Plan provides for the granting of “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended, and nonqualified stock options.

Whenever the following terms are used in this Plan, they shall have the meaning specified below:

“Affiliate” shall mean the Corporation, a Subsidiary, or any employee benefit plan established or maintained by the Corporation or a Subsidiary.

“Board” shall mean the Board of Directors of the Corporation.

“Cause” shall mean (i) the conviction of the Participant of a felony by a court of competent jurisdiction, (ii) the indictment of the Participant by a state or Federal grand jury of competent jurisdiction for embezzlement or misappropriation of funds of the Corporation or for any act of dishonesty or lack of fidelity towards the Corporation, (iii) the written confession by the Participant of any act of dishonesty towards the Corporation or any embezzlement or misappropriation of the Corporation’s funds, or (iv) the willful or gross neglect of the duties for which the Participant was responsible; all as the Committee, in its sole discretion, may determine.

“Change in Control” shall mean the occurrence of one or more of the following events: (i) the Corporation acquires actual knowledge that any person (as such term is used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) other than an Affiliate is or becomes the beneficial owner (as defined in Rule 13d-3 of the Exchange Act) directly or indirectly, of securities of the Corporation representing 10% or more of the combined voting power of the Corporation’s then outstanding securities, (ii) the first purchase of Common Stock pursuant to a tender or exchange offer (other than a tender or exchange offer made by an Affiliate), (iii) the approval by the Corporation’s stockholders of (a) a merger or consolidation of the Corporation with or into another corporation (other than a merger or consolidation in which the Corporation is the surviving corporation and which does not result in any reclassification or reorganization of the Corporation’s then outstanding shares of Common Stock or a change in the Corporation’s directors, other than the addition of not more than three directors), (b) a sale or disposition of all or substantially all of the Corporation’s assets, or (c) a plan of liquidation or dissolution of the Corporation, (iv) during any period of two consecutive calendar years, individuals who at the beginning of such period constitute the Board of Directors of the Corporation cease for any reason to constitute at least two-thirds thereof, unless the election or nomination for the election by the Corporation’s stockholders of each new director was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period, or (v) a sale of (a) Common Stock of the Corporation if after such sale any person (as defined above) other than an Affiliate owns a majority of the Corporation’s Common Stock or (b) all or substantially all of the Corporation’s assets (other than in the ordinary course of business). Notwithstanding the foregoing, no Change in Control shall be deemed to have occurred for purposes of clause (i) above if a person is or becomes the beneficial owner, directly or indirectly, of more than 10% but less than 25% of the combined voting power of the Corporation’s then outstanding securities if the acquisition of all voting securities in excess of 10% was approved in advance by two-thirds of the directors then in office.

“Code” shall mean the Internal Revenue Code of 1986, as now in effect or as hereafter amended. (All citations to sections of the Code are to such sections as they may from time to time be amended or renumbered.).

“Committee” shall mean the committee consisting of at least three (3) directors of the Corporation appointed by the Board to administer the Plan pursuant to the provisions of Article III of the Plan.

“Common Stock” or “Stock” shall mean the common stock of the Corporation, no par value.

“Disability” shall mean permanent and total disability within the meaning of Section 105(d)(4) of the Code.

“Employee” shall mean a common law employee (as defined in accordance with the regulations and Revenue Rulings then applicable under Section 3401(c) of the Code) of an Affiliate.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Incentive Option” shall mean an Option whose terms satisfy the requirements imposed by Section 422 of the Code and which is intended by the Committee to be treated as an Incentive Option.

“Non-qualified Option” shall mean either (i) any Option which, when granted, is not an Incentive Option, and (ii) an Incentive Option which, subsequent to its grant, ceases to qualify as an Incentive Option because of a failure to satisfy the requirements of Section 422(b) of the Code.

“Option” shall mean a right to purchase Common Stock which is awarded in accordance with the terms of this Plan.

“Participant” shall mean an Employee who has been granted an Option under the Plan.

“Plan” shall mean the Hudson United Bancorp 2002 Stock Option Plan, as such plan may be amended from time to time.

“Retirement” shall mean any normal or early retirement by a Participant pursuant to the terms of any pension plan or policy of the Corporation or any Subsidiary which is applicable to such Participant at the time of his or her Termination of Service.

“Secretary” shall mean the corporate secretary of the Corporation.

“Securities Act” shall mean the Securities Act of 1933.

“Shares” shall mean shares of Common Stock.

“Subsidiary(ies)” shall mean any corporation or other legal entity, domestic or foreign, more than 50% of the voting power of which is owned or controlled, directly or indirectly by the Corporation.

“Terminate (Termination of) Service (or Termination)” shall mean the time at which the Participant ceases to provide services to the Corporation as an employee, but shall not include a lapse in providing services which the Committee determines to be a temporary leave of absence.

The Plan shall be administered by a committee (the “Committee”) selected by the Board from among its members, which shall consist of not less than three members, each of whom must be both (i) a “disinterested person” within the meaning of the rules promulgated under Section 16(b) of the Exchange Act, and (ii) an “outside director” within the meaning of Section 162(m) of the Code. The Committee shall hold meetings at such times as may be necessary for the proper administration of the Plan and shall keep minutes of its meetings. A majority of the Committee shall constitute a quorum and a majority of the quorum may authorize any action.

Subject to the provisions of the Plan, the Committee shall have sole authority, in its absolute discretion: (i) to determine which of the eligible Employees of the Corporation shall be granted Options; (ii) to grant Options; (iii) to determine the times when Options may be granted and the number of Shares that may be purchased pursuant to such Options; (iv) to determine the exercise price of the Shares subject to each Option, which price shall be not less than the minimum specified in Section 6.1; (v) to determine the time or times when each Option becomes exercisable, the duration of the exercise period, and any other restrictions on the exercise of Options issued hereunder; (vi) to prescribe the form or forms of the Option agreements under the Plan; (vii) to determine the circumstances under which the time for exercising Options should be accelerated and to accelerate the time for exercising outstanding Options; (viii) to determine the duration and purposes for leaves of absence which may be granted to a Participant without constituting a Termination of Service for purposes of the Plan; (ix) to adopt, amend and rescind such rules and regulations as, in its opinion, may be advisable in the administration of the Plan; and (x) to construe and interpret the Plan, the rules and regulations and the Option agreements under the Plan, and to make all other determinations deemed necessary or advisable for the administration of the Plan; provided, however, that with respect to those eligible Employees who are not “officers” of the Corporation, within the meaning of Section 16(b) of the Exchange Act, the Committee may delegate to any person or persons (“Subcommittee”) all or any part of its authority as set forth in (i) through (x) above. All references in the Plan to the powers of a Subcommittee to act for the Committee shall be applicable only to the extent consistent with the forgoing provision and only to the extend consistent with the powers which have actually been delegated to it. All decisions, determinations and interpretations of the Committee, or Subcommittee, to the extent consistent with such delegation, shall be final and binding.

The maximum number of Shares that may be made subject to Options granted pursuant to the Plan is 1,250,000 (or the number and kind of Shares or other securities which are substituted for those Shares or to which those Shares are adjusted pursuant to the provisions of Article VIII of the Plan). The maximum number of Shares with respect to which Options may be granted to any one person during the term of the plan shall not exceed 400,000 (or the number and kind of Shares or other securities which are substituted for those Shares or to which those Shares are adjusted pursuant to the provisions of Article VIII of the Plan). The Corporation shall reserve such number of Shares for the purposes of the Plan out of its authorized but unissued shares, or out of Shares held in the Corporation’s treasury, or partly out of each, as shall be determined by the Board. No fractional Shares shall be issued with respect to Options granted under the Plan. Once this Plan is approved by Shareholders in accordance with Article XIII, no further Options shall be awarded by the Corporation under the Corporation’s 1995 or 1999 Stock Option Plans.

In the event that any outstanding Option under the Plan for any reason expires, is terminated, forfeited or is cancelled prior to the expiration date of the Plan, the Shares called for by the unexercised portion of such Option shall again be subject to an Option under the Plan.

The Committee may designate any officer of the Corporation, any group or divisional officer, and any other key Employee of the Corporation or a Subsidiary as eligible to receive Options under the Plan. Non-employee directors shall not be eligible to participate in the Plan.

The Committee (or Subcommittee) may, in its sole discretion, grant Options to such officers and key Employees of the Corporation or a Subsidiary as it determines appropriate consistent with Article V. Options shall be evidenced by Option agreements (which need not be identical) in such forms as the Committee may from time to time approve.

Option agreements shall conform to the terms and conditions of the Plan. Such agreements may provide that the grant of any Option under the Plan, or that Stock acquired pursuant to the exercise of any Option, shall be subject to such other conditions (whether or not applicable to the Option or Stock received by any other optionee) as the Committee determines appropriate, including, without limitation, provisions conditioning exercise upon the occurrence of certain events or performance or the passage of time, provisions to assist the optionee in financing the purchase of Stock through the exercise of Options, provisions for forfeiture, or restrictions on resale or other disposition, of shares acquired under the Plan, provisions giving the Corporation the right to repurchase shares acquired under the Plan in the event the Participant elects to dispose of such shares, and provisions to comply with federal and state securities laws and federal and state income tax and other payroll tax withholding requirements. Options granted under this Plan which are intended to qualify as Incentive Options shall be specifically designated as such in the Option agreement.

Subject to Section 6.7 in the case of Incentive Options, all Options shall have a term of no more than ten years from the date of grant; provided, however, that upon the Termination of Service of a Participant, Options that have not become exercisabl