EXHIBIT 4.1




                               Griffon Corporation
                  1998 Employee and Director Stock Option Plan
                                  (as amended)


SECTION 1.  GENERAL PROVISIONS

1.1.  Name and General Purpose

     The name of this plan is the Griffon Corporation 1998 Employee and Director
Stock Option Plan (hereinafter called the "Plan").  The Plan is intended to be a
broadly-based  incentive plan which enables Griffon  Corporation (the "Company")
and its  subsidiaries  and affiliates to foster and promote the interests of the
Company by attracting  and retaining  directors,  officers and employees of, and
consultants  to, the Company who  contribute to the  Company's  success by their
ability, ingenuity and industry, to enable such directors,  officers,  employees
and  consultants  to  participate  in the  long-term  success  and growth of the
Company by giving  them a  proprietary  interest  in the  Company and to provide
incentive  compensation   opportunities  competitive  with  those  of  competing
corporations.

1.2  Definitions

     a.   "Affiliate"  means any person or entity  controlled by or under common
          control  with the  Company,  by  virtue  of the  ownership  of  voting
          securities, by contract or otherwise.

     b.   "Board" means the Board of Directors of the Company.

     c.   "Change in Control"  means a change of control of the  Company,  or in
          any person directly or indirectly controlling the Company, which shall
          mean:

          (a)  a  change  in  control  as such  term  is  presently  defined  in
               Regulation 240.12b-(2) under the Securities Exchange Act of 1934,
               as amended (the "Exchange Act"); or

          (b)  if any "person" (as such term is used in Section  13(d) and 14(d)
               of the  Exchange  Act) other than the Company or any "person" who
               on the date of this  Agreement  is a  director  or officer of the
               Company,  becomes  the  "beneficial  owner"  (as  defined in Rule
               13(d)-3  under the  Exchange  Act)  directly  or  indirectly,  of
               securities of the Company  representing  twenty  percent (20%) or
               more  of the  voting  power  of the  Company's  then  outstanding
               securities; or

          (c)  if during any period of two (2) consecutive years during the term
               of this Plan,  individuals  who at the  beginning  of such period
               constitute  the  Board of  Directors,  cease  for any  reason  to
               constitute at least a majority thereof.

     d.   "Committee"  means the  Committee  referred  to in Section  1.3 of the
          Plan.

     e.   "Common  Stock" means shares of the Common  Stock,  par value $.25 per
          share, of the Company.

     f.   "Company" means Griffon Corporation, a corporation organized under the
          laws of the State of Delaware (or any successor corporation).

     g.   "Fair Market  Value" means the market price of the Common Stock on the
          New York Stock Exchange  consolidated  reporting system on the date of
          the grant or on any  other  date on which  the  Common  Stock is to be
          valued hereunder.  If no sale shall have been reported on the New York
          Stock Exchange consolidated reporting system on such date, Fair Market
          Value shall be determined by the Committee.

     h.   "Non-Employee Director" shall have the meaning set forth in Rule 16(b)
          promulgated by the Securities and Exchange Commission ("Commission").

     i.   "Option" means any option to purchase  Common Stock under Section 2 of
          the Plan.

     j.   "Option Agreement" means the option agreement described in Section 2.4
          of the Plan.



     k.   "Participant" means any director,  officer,  employee or consultant of
          the  Company,  a  Subsidiary  or an  Affiliate  who is selected by the
          Committee to participate in the Plan.

     l.   "Subsidiary"  means any  corporation  in which the  Company  possesses
          directly or indirectly 50% or more of the combined voting power of all
          classes of stock of such corporation.

     m.   "Total  Disability"  means accidental  bodily injury or sickness which
          wholly and  continuously  disabled an optionee.  The Committee,  whose
          decisions  shall  be  final,  shall  make  a  determination  of  Total
          Disability.

1.3  Administration of the Plan

     The Plan shall be  administered  by the  Committee  appointed  by the Board
consisting of two or more members of the Board all of whom shall be Non-Employee
Directors. The Committee shall serve at the pleasure of the Board and shall have
such powers as the Board may, from time to time, confer upon it.

     Subject to this  Section 1.3,  the  Committee  shall have sole and complete
authority to adopt, alter, amend or revoke such administrative rules, guidelines
and  practices  governing  the  operation of the Plan as it shall,  from time to
time, deem advisable, and to interpret the terms and provisions of the Plan.

     The Committee  shall keep minutes of its meetings and of action taken by it
without a meeting.  A majority of the Committee shall  constitute a quorum,  and
the acts of a majority of the  members  present at any meeting at which a quorum
is present,  or acts  approved in writing by all of the members of the Committee
without a meeting, shall constitute the acts of the Committee.

1.4  Eligibility

     Stock  Options may be granted  only to  directors,  officers,  employees or
consultants of the Company or a Subsidiary or Affiliate. Subject to Section 2.3,
any person who has been granted any Option may, if he is otherwise eligible,  be
granted an additional Option or Options.

1.5  Shares

     The aggregate  number of shares reserved for issuance  pursuant to the Plan
shall be 2,425,000  shares of Common Stock,  or the number and kind of shares of
stock or other securities which shall be substituted for such shares or to which
such shares shall be adjusted as provided in Section 1.6.

     Such number of shares may be set aside out of the  authorized  but unissued
shares of Common Stock or out of issued shares of Common Stock  acquired for and
held in the Treasury of the Company, not reserved for any other purpose.  Shares
subject to, but not sold or issued under, any Option terminating or expiring for
any reason  prior to its  exercise in full will again be  available  for Options
thereafter granted during the balance of the term of the Plan.

1.6  Adjustments Due to Stock Splits,
     Mergers, Consolidation, Etc.

     If, at any time,  the  Company  shall  take any  action,  whether  by stock
dividend,  stock split,  combination of shares or otherwise,  which results in a
proportionate  increase  or  decrease  in the  number of shares of Common  Stock
theretofore issued and outstanding,  the number of shares which are reserved for
issuance  under the Plan and the  number  of shares  which,  at such  time,  are
subject to Options shall, to the extent deemed appropriate by the Committee,  be
increased or  decreased  in the same  proportion,  provided,  however,  that the
Company shall not be obligated to issue fractional shares.

     Likewise,  in the event of any change in the  outstanding  shares of Common
Stock by reason of any recapitalization, merger, consolidation,  reorganization,
combination or exchange of shares or other corporate change, the Committee shall
make such substitution or adjustments, if any, as it deems to be appropriate, as
to the number or kind of shares of Common  Stock or other  securities  which are
reserved  for  issuance  under  the  Plan  and the  number  of  shares  or other
securities which, at such time are subject to Options.

                                      -2-
_________
(1)  after giving effect to the Company's 10% stock dividend in August 2001.



     In the  event  of a  Change  in  Control,  at the  option  of the  Board or
Committee,  (a) all  Options  outstanding  on the date of such Change in Control
shall, for a period of sixty (60) days following such Change in Control,  become
immediately  and fully  exercisable,  and (b) an optionee  will be  permitted to
surrender for  cancellation  within sixty (60) days after such Change in Control
any Option or portion of an Option  which was  granted  more than six (6) months
prior to the date of such  surrender,  to the extent not yet  exercised,  and to
receive a cash  payment in an amount  equal to the  excess,  if any, of the Fair
Market Value (on the date of surrender) of the shares of Common Stock subject to
the Option or portion thereof surrendered, over the aggregate purchase price for
such Shares under the Option.

1.7  Non-Alienation of Benefits

     Except as herein  specifically  provided,  no right or unpaid benefit under
the Plan shall be subject to  alienation,  assignment,  pledge or charge and any
attempt to  alienate,  assign,  pledge or charge the same shall be void.  If any
Participant  or other person  entitled to benefits  hereunder  should attempt to
alienate,  assign,  pledge or charge any benefit  hereunder,  then such  benefit
shall, in the discretion of the Committee, cease.

1.8  Withholding or Deduction for Taxes

     If, at any time,  the Company or any  Subsidiary  or Affiliate is required,
under applicable laws and regulations, to withhold, or to make any deduction for
any taxes, or take any other action in connection with any Option exercise,  the
Participant  shall be  required  to pay to the  Company  or such  Subsidiary  or
Affiliate, the amount of any taxes required to be withheld, or, in lieu thereof,
at the option of the Company,  the Company or such  Subsidiary  or Affiliate may
accept a  sufficient  number  of shares  of  Common  Stock to cover  the  amount
required to be withheld.

1.9  Administrative Expenses

     The entire expense of administering the Plan shall be borne by the Company.

1.10 General Conditions

     a.   The Board or the Committee may, from time to time,  amend,  suspend or
          terminate  any or all of the  provisions of the Plan,  provided  that,
          without the Participant's  approval, no change may be made which would
          alter or impair any right theretofore granted to any Participant .

     b.   With the consent of the Participant  affected  thereby,  the Committee
          may  amend  or  modify  any  outstanding  Option  in  any  manner  not
          inconsistent   with  the  terms  of  the  Plan,   including,   without
          limitation,  and  irrespective  of the  provisions  of Section  2.3(c)
          below,  to accelerate  the date or dates as of which an installment of
          an Option becomes exercisable.

     c.   Nothing  contained  in the Plan  shall  prohibit  the  Company  or any
          Subsidiary or Affiliate from establishing  other additional  incentive
          compensation  arrangements  for  employees  of  the  Company  or  such
          Subsidiary or Affiliate.

     d.   Nothing in the Plan shall be deemed to limit, in any way, the right of
          the  Company  or  any   Subsidiary   or   Affiliate   to  terminate  a
          Participant's  employment  with the  Company  (or such  Subsidiary  or
          Affiliate) at any time.

     e.   Any decision or action taken by the Board or the Committee arising out
          of  or  in   connection   with   the   construction,   administration,
          interpretation  and effect of the Plan shall be conclusive and binding
          upon all  Participants  and any person  claiming  under or through any
          Participant.

     f.   No member of the Board or of the Committee shall be liable for any act
          or action,  whether of  commission  or  omission,  (i) by such  member
          except in  circumstances  involving  actual bad faith, nor (ii) by any
          other member or by any officer, agent or employee.

1.11  Compliance with Applicable Law

     Notwithstanding  any other  provision of the Plan, the Company shall not be
obligated to issue any shares of Common Stock,  or grant any Option with respect
thereto,  unless it is advised by  counsel  of its  selection  that it may do so
without  violation of the  applicable  Federal and State laws  pertaining to the
issuance of  securities  and the Company  may require any stock  certificate  so
issued to bear a legend, may give its transfer agent  instructions  limiting the
transfer  thereof,  and may  take  such  other  steps,  as in its  judgment  are
reasonably required to prevent any such violation.

                                      -3-



1.12  Effective Dates

     The Plan was  adopted by the Board on  February  5, 1998 and amended by the
Board on July 30, 1998,  November 5, 1998 and  February 6, 2002.  The Plan shall
terminate on February 4, 2008.


Section 2.  OPTION GRANTS

2.1  Authority of Committee

     Subject to the  provisions of the Plan,  the Committee  shall have the sole
and complete  authority to determine (i) the  Participants to whom Options shall
be granted;  (ii) the number of shares to be covered by each  Option;  and (iii)
the  conditions  and  limitations,  if any,  in  addition  to those set forth in
Sections 2 and 3 hereof,  applicable  to the  exercise  of an Option,  including
without limitation,  the nature and duration of the restrictions,  if any, to be
imposed upon the sale or other  disposition of shares  acquired upon exercise of
an Option.

     Stock Options granted under the Plan shall be non-qualified stock options.

     The Committee shall have the authority to grant Options.

2.2  Option Exercise Price

     The price of stock purchased upon the exercise of Options granted  pursuant
to the Plan shall be the Fair Market  Value  thereof at the time that the Option
is granted.

     The  purchase  price  is to be  paid in full  in  cash,  certified  or bank
cashier's  check or, at the option of the  Company,  Common  Stock valued at its
Fair Market Value on the date of exercise,  or a combination  thereof,  when the
Option is exercised and stock  certificates  will be delivered only against such
payment.

2.3  Option Grants

     Each Option will be subject to the following provisions:

     a.   Term of Option

          An Option  will be for a term of not more than ten years from the date
          of grant.

     b.   Exercise

          (i)  By an Employee:

          Subject to the power of the Committee  under Section 1.10(b) above and
          except in the manner  described  below upon the death of the optionee,
          an Option may be  exercised  only in  installments  as follows:  up to
          one-half of the subject  shares on and after the first  anniversary of
          the date of grant,  up to all of the  subject  shares on and after the
          second such anniversary of the date of the grant of such Option but in
          no event later than the expiration of the term of the Option.

          An Option shall be exercisable during the optionee's  lifetime only by
          the optionee and shall not be exercisable by the optionee  unless,  at
          all times  since the date of grant and at the time of  exercise,  such
          optionee is an employee of or providing  services to the Company,  any
          parent  corporation  of the Company or any  Subsidiary  or  Affiliate,
          except that,  upon  termination of all such employment or provision of
          services  (other  than  by  death,  Total  Disability,   or  by  Total
          Disability followed by death in the circumstances provided below), the
          optionee  may  exercise  an Option  at any time  within  three  months
          thereafter  but only to the extent such Option is  exercisable  on the
          date of such termination.

          Upon  termination  of all such  employment  by Total  Disability,  the
          optionee  may  exercise  such  Options at any time within  three years
          thereafter,  but only to the extent such Option is  exercisable on the
          date of such termination.

                                      -4-


          In the event of the death of an  optionee  (i) while an employee of or
          providing  services  to the  Company,  any parent  corporation  of the
          Company or any  Subsidiary or  Affiliate,  or (ii) within three months
          after  termination  of all such  employment  or  provision of services
          (other than for Total  Disability)  or (iii)  within three years after
          termination on account of Total  Disability of all such  employment or
          provision  of  services,  such  optionee's  estate or any  person  who
          acquires the right to exercise  such option by bequest or  inheritance
          or by reason of the death of the optionee may exercise such optionee's
          Option at any time  within the period of three  years from the date of
          death.  In the case of clauses (i) and (iii) above,  such Option shall
          be exercisable in full for all the remaining  shares covered  thereby,
          but in the case of clause (ii) such Option shall be  exercisable  only
          to the extent it was exercisable on the date of such termination.


          (ii) By Persons other than Employees:

          If the  optionee  is not an  employee  of the  Company  or the  parent
          corporation of the Company or any Subsidiary or Affiliate,  expiration
          of such optionee's  right to exercise his Options shall be established
          and determined by the Committee in the Option  Agreement  covering the
          Options granted to such optionee.

          Notwithstanding the foregoing  provisions regarding the exercise of an
          Option in the event of death,  Total Disability,  other termination of
          employment or provision of services or otherwise, in no event shall an
          Option be exercisable in whole or in part after the  termination  date
          provided in the Option Agreement.

          c.   Transferability

          An Option granted under the Plan shall not be  transferable  otherwise
          than by will or by the laws of descent and distribution, except as may
          be permitted by the Board or the Committee.

2.4  Agreements

     In  consideration  of any Options granted to a Participant  under the Plan,
each such  Participant  shall  enter into an Option  Agreement  with the Company
providing,  consistent  with the  Plan,  such  terms as the  Committee  may deem
advisable.