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Exhibit 10.4
 
 
FIRST KEYSTONE FINANCIAL, INC.
AMENDED AND RESTATED 1995 STOCK OPTION PLAN
 
ARTICLE I
ESTABLISHMENT OF THE PLAN
 
First Keystone Financial, Inc. (the "Corporation") hereby amends and restates
its 1995 Stock Option Plan (as amended and restated, the "Plan") upon the terms
and conditions hereinafter stated, with the amendment and restatement effective
as of November __, 2008.  The Plan is being amended and restated in order to
comply with Section 409A of the Code, as defined herein.
 
 
ARTICLE II
PURPOSE OF THE PLAN
 
The purpose of this Plan is to improve the growth and profitability of the
Corporation and its Subsidiary Companies by providing Employees and Non-Employee
Directors with a proprietary interest in the Corporation as an incentive to
contribute to the success of the Corporation and its Subsidiary Companies, and
rewarding those Employees for outstanding performance and the attainment of
targeted goals.  All Incentive Stock Options issued under this Plan are intended
to comply with the requirements of Section 422 of the Code and the regulations
thereunder, and all provisions hereunder shall be read, interpreted and applied
with that purpose in mind.
 
 
ARTICLE III
DEFINITIONS
 
3.01           "Award" means an Option or Stock Appreciation Right granted
pursuant to the terms of this Plan.
 
3.02           "Bank" means First Keystone Bank, the wholly owned subsidiary of
the Corporation.
 
3.03           "Board" means the Board of Directors of the Corporation.
 
3.04           "Code" means the Internal Revenue Code of 1986, as amended.
 
3.05           "Committee" means a committee of two or more directors appointed
by the Board pursuant to Article IV hereof, none of whom shall be an Officer or
Employee of the Corporation, and each of whom shall be a Non-Employee Director
within the meaning of Rule 16b-3 under the Exchange Act, or any successor
thereto.
 
3.06           "Common Stock" means shares of the common stock, $.01 par value
per share, of the Corporation.
 
 
 

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3.07           "Disability" means in the case of any Optionee that the Optionee:
(i) is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, or (ii) is, by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Corporation or the Bank (or
would have received such benefits for at least three months if he had been
eligible to participate in such plan).
 
3.08           "Effective Date" means the day upon which the Board originally
adopted this Plan.
 
3.09           "Employee" means any person who is employed by the Corporation,
the Bank or any Subsidiary Company, or is an Officer of the Corporation, the
Bank or any Subsidiary Company, but not including directors who are not also
Officers of or otherwise employed by the Corporation or a Subsidiary Company.
 
3.10           "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
 
3.11          "Fair Market Value" shall be equal to the fair market value per
share of the Corporation's Common Stock on the date an Award is granted.  For
purposes hereof, the Fair Market Value of a share of Common Stock shall be the
closing sale price of a share of Common Stock on the date in question (or, if
such day is not a trading day in the U.S. markets, on the nearest preceding
trading day), as reported with respect to the principal market (or the composite
of the markets, if more than one) or national quotation system in which such
shares are then traded, or if no such closing prices are reported, the mean
between the high bid and low asked prices that day on the principal market or
national quotation system then in use. Notwithstanding the foregoing, if the
Common Stock is not readily tradable on an established securities market for
purposes of Section 409A of the Code, then the Fair Market Value shall be
determined by means of a reasonable valuation method that takes into
consideration all available information material to the value of the Corporation
and that otherwise satisfies the requirements applicable under Section 409A of
the Code and the regulations thereunder.
 
3.12           "Incentive Stock Option" means any Option granted under this Plan
which the Board intends (at the time it is granted) to be an incentive stock
option within the meaning of Section 422 of the Code or any successor thereto.
 
3.13           "Non-Employee Director" means a member of the Board who is not an
Officer or Employee of the Corporation or any Subsidiary Company.
 
3.14           "Non-Qualified Option" means any Option granted under this Plan
which is not an Incentive Stock Option.
 
 
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3.15           "Offering" means the offering of Common Stock to the public
pursuant to the conversion of the Bank from the mutual to the stock form and the
organization of the Bank as a subsidiary of the Corporation.
 
3.16           "Officer" means an Employee whose position in the Corporation or
Subsidiary Company is that of a corporate officer, as determined by the Board.
 
3.17           "Option" means a right granted under this Plan to purchase Common
Stock.
 
3.18           "Optionee" means an Employee or Non-Employee Director or former
Employee or Non-Employee Director to whom an Option is granted under the Plan.
 
3.19           "Retirement" means a termination of employment upon or after
attainment of age sixty-five (65) or such earlier age as may be specified in any
applicable qualified pension benefit plan maintained by the Corporation or a
Subsidiary Company.
 
3.20           "Stock Appreciation Right" means a right to surrender an Option
in consideration for a payment by the Corporation in cash and/or Common Stock,
as provided in the discretion of the Committee in accordance with Section 8.11.
 
3.21           "Subsidiary Companies" means those subsidiaries of the
Corporation, including the Bank, which meet the definition of "subsidiary
corporations" set forth in Section 424(f) of the Code, at the time of granting
of the Option in question.
 
 
ARTICLE IV
ADMINISTRATION OF THE PLAN
 
4.01           Duties of the Committee.  The Plan shall be administered and
interpreted by the Committee, as appointed from time to time by the Board
pursuant to Section 4.02.  The Committee shall have the authority in its
absolute discretion to adopt, amend and rescind such rules, regulations and
procedures as, in its opinion, may be advisable in the administration of the
Plan, including, without limitation, rules, regulations and procedures which (i)
deal with satisfaction of an Optionee's tax withholding obligation pursuant to
Section 12.02 hereof, (ii) include arrangements to facilitate the Optionee's
ability to borrow funds for payment of the exercise or purchase price of an
Award, if applicable, from securities brokers and dealers, and (iii) include
arrangements which provide for the payment of some or all of such exercise or
purchase price by delivery of previously-owned shares of Common Stock or other
property and/or by withholding some of the shares of Common Stock which are
being acquired.  The interpretation and construction by the Committee of any
provisions of the Plan, any rule, regulation or procedure adopted by it pursuant
thereto or of any Award shall be final and binding in the absence of action by
the Board.
 
4.02           Appointment and Operation of the Committee.  The members of the
Committee shall be appointed by, and will serve at the pleasure of, the
Board.  The Board from time to time may remove members from, or add members to,
the Committee, provided the Committee shall continue to consist of two or more
members of the Board, none of whom shall be an Officer or Employee of the
Corporation, and each of whom shall be a "Non-Employee Director" within the
meaning of Rule 16b-3 under the Exchange Act.  The Committee shall act by vote
or written consent of a majority of its members.  Subject to the express
provisions and limitations of the Plan, the Committee may adopt such rules,
regulations and procedures as it deems appropriate for the conduct of its
affairs.  It may appoint one of its members to be chairman and any person,
whether or not a member, to be its secretary or agent.  The Committee shall
report its actions and decisions to the Board at appropriate times but in no
event less than one time per calendar year.
 
 
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4.03           Revocation for Misconduct.  The Committee may by resolution
immediately revoke, rescind and terminate any Option, or portion thereof, to the
extent not yet vested, or any Stock Appreciation Right, to the extent not yet
exercised, previously granted or awarded under this Plan to an Employee who is
discharged from the employ of the Corporation or a Subsidiary Company for cause,
which, for purposes hereof, shall mean termination because of the Employee's
personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law, rule, or regulation (other than traffic violations or
similar offenses) or final cease-and-desist order.  Options granted to a
Non-Employee Director who is removed for cause pursuant to the Corporation's
Articles of Incorporation shall terminate as of the effective date of such
removal.
 
4.04           Limitation on Liability.  No member of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan, any rule, regulation or procedure adopted by it pursuant thereto or any
Awards granted under it.  If a member of the Committee is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of anything done or not done by him in such capacity under or with
respect to the Plan, the Corporation shall, subject to the requirements of
applicable laws and regulations, indemnify such member against all liabilities
and expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in the best interests of the Corporation and its
Subsidiary Companies and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful.
 
4.05           Compliance with Laws and Regulations.  All Awards granted
hereunder shall be subject to all applicable federal and state laws, rules and
regulations and to such approvals by any government or regulatory agency as may
be required.  The Corporation shall not be required to issue or deliver any
certificates for shares of Common Stock prior to the completion of any
registration or qualification of or obtaining of consents or approvals with
respect to such shares under any federal or state law or any rule or regulation
of any government body, which the Corporation shall, in its sole discretion,
determine to be necessary or advisable.  Moreover, no Option or Stock
Appreciation Right may be exercised if such exercise would be contrary to
applicable laws and regulations.
 
 
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4.06           Restrictions on Transfer.  The Corporation may place a legend
upon any certificate representing shares acquired pursuant to an Award granted
hereunder noting that the transfer of such shares may be restricted by
applicable laws and regulations.
 
4.07           No Deferral of Compensation Under Section 409A of the Code. All
Awards granted under the Plan are designed to not constitute a deferral of
compensation for purposes of Section 409A of the Code.  Notwithstanding any
other provision in this Plan to the contrary, all of the terms and conditions of
any Awards granted under this Plan shall be designed to satisfy the exemption
for stock options or stock appreciation rights set forth in the regulations
issued under Section 409A of the Code.  Both this Plan and the terms of all
Options and Stock Appreciation Rights granted hereunder shall be interpreted in
a manner that requires compliance with all of the requirements of the exemption
for stock options or stock appreciation rights set forth in the regulations
issued under Section 409A of the Code.  No Optionee shall be permitted to defer
the recognition of income beyond the exercise date of a Non-Qualified Option or
Stock Appreciation Right or beyond the date that the Common Stock received upon
the exercise of an Incentive Stock Option is sold.
 
 
ARTICLE V
ELIGIBILITY
 
Awards may be granted to such Employees or Non-Employee Directors of the
Corporation and its Subsidiary Companies as may be designated from time to time
by the Committee.  Awards may not be granted to individuals who are not
Employees or Non-Employee Directors of either the Corporation or its Subsidiary
Companies.  Non-Employee Directors shall be eligible to receive only
Non-Qualified Options pursuant to Section 8.02 of the Plan.
 
 
ARTICLE VI
COMMON STOCK COVERED BY THE PLAN
 
6.01           Option Shares.  The aggregate number of shares of Common Stock
which may be issued pursuant to this Plan, subject to adjustment as provided in
Article IX, shall be 136,000, which is equal to 10.0% of the shares of Common
Stock issued in the Offering.  None of such shares shall be the subject of more
than one Award at any time, but if an Option as to any shares is surrendered
before exercise, or expires or terminates for any reason without having been
exercised in full, or for any other reason ceases to be exercisable, the number
of shares covered thereby shall again become available for grant under the Plan
as if no Awards had been previously granted with respect to such
shares.  Notwithstanding the foregoing, if an Option is surrendered in
connection with the exercise of a Stock Appreciation Right, the number of shares
covered thereby shall not be available for grant under the Plan.
 
6.02           Source of Shares.  The shares of Common Stock issued under the
Plan may be authorized but unissued shares, treasury shares or shares purchased
by the Corporation on the open market or from private sources for use under the
Plan.
 
 
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ARTICLE VII
DETERMINATION OF
AWARDS, NUMBER OF SHARES, ETC.
 
The Committee shall, in its discretion, determine from time to time which
Employees will be granted Awards under the Plan, the number of shares of Common
Stock subject to each Award, whether each Option will be an Incentive Stock
Option or a Non-Qualified Stock Option and the exercise price of an Option.  In
making all such determinations there shall be taken into account the duties,
responsibilities and performance of each respective Employee, his present and
potential contributions to the growth and success of the Corporation, his salary
and such other factors as the Committee shall deem relevant to accomplishing the
purposes of the Plan.  Non-Employee Directors shall be eligible to receive only
Non-Qualified Options pursuant to Section 8.02 of the Plan.
 
 
ARTICLE VIII
OPTIONS AND STOCK APPRECIATION RIGHTS
 
Each Option granted hereunder shall be on the following terms and conditions:
 
8.01           Stock Option Agreement.  The proper Officers on behalf of the
Corporation and each Optionee shall execute a Stock Option Agreement which shall
set forth the total number of shares of Common Stock to which it pertains, the
exercise price, whether it is a Non-Qualified Option or an Incentive Stock
Option, and such other terms, conditions, restrictions and privileges as the
Committee in each instance shall deem appropriate, provided they are not
inconsistent with the terms, conditions and provisions of this Plan.  Each
Optionee shall receive a copy of his executed Stock Option Agreement.  Any
Option granted with the intention that it will be an Incentive Stock Option but
which fails to satisfy a requirement for Incentive Stock Options shall continue
to be valid and shall be treated as a Non-Qualified Option.
 
8.02           (a)           Initial Grants to Non-Employee
Directors.  Non-Qualified Options to purchase 2,720 shares of Common Stock shall
be initially granted to each Non-Employee Director as of the day that the Plan
was initially approved by stockholders of the Corporation (except that each
Non-Employee Director who has served as a director of the Bank for more than 30
years shall be awarded a Non-Qualified Option to purchase 5,440 shares of Common
Stock), effective at such time and with a per share exercise price equal to the
Fair Market Value of a share of Common Stock on such date.
 
     (b)           Subsequent Grants.  Each Non-Employee Director of the
Corporation shall receive a Non-Qualified Option to purchase 340 shares of
Common Stock (except that each Non-Employee Director who has served as a
director of the Bank for more than 30 years shall be awarded a Non-Qualified
Option to purchase 680 shares of Common Stock) on each anniversary date for two
years after the initial grants pursuant to Section 8.02(a), or such lesser
number as may then be available for grant under this Plan, at the per share
exercise price equal to the Fair Market Value of a share of Common Stock on such
date.
 
 
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(c)           Vesting and Exercise of Options.  Non-Qualified Options granted to
Non-Employee Directors shall be vested and exercisable over five years at the
rate of twenty percent per year commencing one year following the date of grant.
 
8.03     Option Exercise Price.
 
(a)           Incentive Stock Options.  The per share price at which the subject
Common Stock may be purchased upon exercise of an Incentive Stock Option shall
be no less than one hundred percent (100%) of the Fair Market Value of a share
of Common Stock at the time such Incentive Stock Option is granted, except as
provided in Section 8.10(b).
 
(b)           Non-Qualified Options.  The per share price at which the subject
Common Stock may be purchased upon exercise of a Non-Qualified Option shall be
established by the Committee at the time of grant, but in no event shall be less
than the greater of (i) the par value or (ii) one hundred percent (100%) of the
Fair Market Value of a share of Common Stock at the time such Non-Qualified
Option is granted.
 
8.04     Vesting and Exercise of Options.
 
(a)           General Rules.  Incentive Stock Options and Non-Qualified Options
granted to Employees shall become vested and exercisable at the rate, to the
extent and subject to such limitations as may be specified by the Committee,
provided, however, that in the case of any Option exercisable within the first
six months following the date the Option is granted, the shares of Common Stock
received upon the exercise of such Option may not be sold or disposed of by the
optionee for the first six months following the date of grant.  Notwithstanding
the foregoing, no vesting shall occur on or after an Optionee's employment or
service with the Corporation and all Subsidiary Companies is terminated for any
reason other than his death or Disability.  In determining the number of shares
of Common Stock with respect to which Options are vested and/or exercisable,
fractional shares will be rounded up to the nearest whole number if the fraction
is 0.5 or higher, and down if it is less.
 
(b)           Accelerated Vesting Upon Death or Disability.  Unless the
Committee shall specifically state otherwise at the time an Option is granted,
all Options granted under this Plan shall become vested and exercisable in full
on the date an Optionee terminates his employment or service with the
Corporation or a Subsidiary Company because of his death or Disability.
 
(c)           Accelerated Vesting Upon a Change in Control.  Notwithstanding the
general rule described in Section 8.04(a), all outstanding Options shall become
immediately vested and exercisable in the event there is a change in control of
the Corporation.  A "change in control of the Corporation" for this purpose
shall mean a change in the ownership of the Corporation or the Bank, a change in
the effective control of the Corporation or the Bank or a change in the
ownership of a substantial portion of the assets of the Corporation or the Bank,
in each case as provided under Section 409A of the Code and the regulations
thereunder.
 
 
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8.05     Duration of Options.
 
(a)           General Rule.  Except as provided in Sections 8.05(b) and 8.10,
each Option or portion thereof shall be exercisable at any time on or after it
vests and becomes exercisable until the earlier of (i) ten (10) years after its
date of grant or (ii) three (3) months after the date on which the Optionee
ceases to be employed by or serve as a Director of the Corporation and all
Subsidiary Companies, unless the Committee in its discretion decides at the time
of grant or thereafter to extend such period of exercise upon termination of
employment or service from three (3) months to a period not exceeding five (5)
years.
 
(b)           Exception for Termination Due to Death, Disability or
Retirement.  If an Optionee dies while in the employ or service of the
Corporation or a Subsidiary Company or terminates employment or service with the
Corporation or a Subsidiary Company as a result of Disability or Retirement
without having fully exercised his Options, the Optionee or the executors,
administrators, legatees or distributees of his estate shall have the right,
during the twelve-month period following the earlier of his death, Disability or
Retirement, to exercise such Options to the extent vested on the date of such
death, Disability or Retirement.  In no event, however, shall any Option be
exercisable within six (6) months after the date of grant or more than ten (10)
years (or five (5) years for Options subject to Section 8.10(b) hereof) from the
date it was granted.
 
8.06     Nonassignability.  Options shall not be transferable by an Optionee
except by will or the laws of descent or distribution, and during an Optionee's
lifetime shall be exercisable only by such Optionee or the Optionee's guardian
or legal representative.
 
8.07     Manner of Exercise.  Options may be exercised in part or in whole and
at one time or from time to time.  The procedures for exercise shall be set
forth in the written Stock Option Agreement provided for in Section 8.01 above.
 
8.08     Payment for Shares.  Payment in full of the purchase price for shares
of Common Stock purchased pursuant to the exercise of any Option shall be made
to the Corporation upon exercise of the Option.  All shares sold under the Plan
shall be fully paid and nonassessable.  Payment for shares may be made by the
Optionee in cash or, at the discretion of the Committee in the case of Awards to
Employees, by delivering shares of Common Stock (including shares acquired
pursuant to the exercise of an Option) or other property equal in Fair Market
Value to the purchase price of the shares to be acquired pursuant to the Option,
by withholding some of the shares of Common Stock which are being purchased upon
exercise of an Option, or any combination of the foregoing.
 
8.09     Voting and Dividend Rights. No Optionee shall have any voting or
dividend rights or other rights of a stockholder in respect of any shares of
Common Stock covered by an Option prior to the time that his name is recorded on
the Corporation's stockholder ledger as the holder of record of such shares
acquired pursuant to an exercise of an Option.
 
 
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8.10      Additional Terms Applicable to Incentive Stock Options.  All Options
issued under the Plan as Incentive Stock Options will be subject, in addition to
the terms detailed in Sections 8.01 to 8.09 above, to those contained in this
Section 8.10.
 
(a)           Amount Limitation.  Notwithstanding any contrary provisions
contained elsewhere in this Plan and as long as required by Section 422 of the
Code, the aggregate Fair Market Value, determined as of the time an Incentive
Stock Option is granted, of the Common Stock with respect to which Incentive
Stock Options are exercisable for the first time by the Optionee during any
calendar year, under this Plan and stock options that satisfy the requirements
of Section 422 of the Code under any other stock option plan or plans maintained
by the Corporation (or any parent or Subsidiary Company), shall not exceed
$100,000.
 
(b)           Limitation on Ten Percent Stockholders.  The price at which shares
of Common Stock may be purchased upon exercise of an Incentive Stock Option
granted to an individual who, at the time such Incentive Stock Option is
granted, owns, directly or indirectly, more than ten percent (10%) of the total
combined voting power of all classes of stock issued to stockholders of the
Corporation or any Subsidiary Company, shall be no less than one hundred and ten
percent (110%) of the Fair Market Value of a share of the Common Stock of the
Corporation at the time of grant, and such Incentive Stock Option shall by its
terms not be exercisable after the earlier of the date determined under Section
8.05 or the expiration of five (5) years from the date such Incentive Stock
Option is granted.
 
(c)           Notice of Disposition; Withholding; Escrow.  An Optionee shall
immediately notify the Corporation in writing of any sale, transfer, assignment
or other disposition (or action constituting a disqualifying disposition within
the meaning of Section 421 of the Code) of any shares of Common Stock acquired
through exercise of an Incentive Stock Option, within two (2) years after the
grant of such Incentive Stock Option or within one (1) year after the
acquisition of such shares, setting forth the date and manner of disposition,
the number of shares disposed of and the price at which such shares were
disposed of.  The Corporation shall be entitled to withhold from any
compensation or other payments then or thereafter due to the Optionee such
amounts as may be necessary to satisfy any withholding requirements of federal
or state law or regulation and, further, to collect from the Optionee any
additional amounts which may be required for such purpose.  The Committee may,
in its discretion, require shares of Common Stock acquired by an Optionee upon
exercise of an Incentive Stock Option to be held in an escrow arrangement for
the purpose of enabling compliance with the provisions of this Section 8.10(c).
 
8.11     Stock Appreciation Rights.
 
(a)           General Terms and Conditions.  The Committee may, but shall not be
obligated to, authorize the Corporation, on such terms and conditions as it
deems appropriate in each case, to grant rights to Optionees to surrender an
exercisable Option, or any portion thereof, in consideration for the payment by
the Corporation of an amount equal to the excess of the Fair Market Value of the
shares of Common Stock subject to the Option, or portion thereof, surrendered
over the exercise price of the Option with respect to such shares (any such
authorized surrender and payment being hereinafter referred to as a "Stock
Appreciation Right").  Such payment, at the discretion of the Committee, may be
made in shares of Common Stock valued at the then Fair Market Value thereof, or
in cash, or partly in cash and partly in shares of Common Stock.
 
 
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The terms and conditions set with respect to a Stock Appreciation Right may
include (without limitation), subject to other provisions of this Section 8.11
and the Plan, the period during which, date by which or event upon which the
Stock Appreciation Right may be exercised; the method for valuing shares of
Common Stock for purposes of this Section 8.11; a ceiling on the amount of
consideration which the Corporation may pay in connection with exercise and
cancellation of the Stock Appreciation Right; and arrangements for income tax
withholding.  The Committee shall have complete discretion to determine whether,
when and to whom Stock Appreciation Rights may be granted.  Notwithstanding the
foregoing, the Corporation may not permit the exercise of a Stock Appreciation
Right issued pursuant to this Plan until the Corporation has been subject to the
reporting requirements of Section 13 of the Exchange Act for a period of at
least one year prior to the exercise of any such Stock Appreciation Right and
until a Stock Appreciation Right issued pursuant to this Plan has been
outstanding for at least six months from the date of grant.
 
(b)           Time Limitations.  If a holder of a Stock Appreciation Right
terminates service with the Corporation as an Officer or Employee, the Stock
Appreciation Right may be exercised only within the period, if any, within which
the Option to which it relates may be exercised.  Notwithstanding the foregoing,
any election by an Optionee to exercise the Stock Appreciation Rights provided
in this Plan shall be made during the period beginning on the third business day
following the release for publication of quarterly or annual financial
information required to be prepared and disseminated by the Corporation pursuant
to the requirements of the Exchange Act and ending on the twelfth business day
following such date.  The required release of information shall be deemed to
have been satisfied when the specified financial data appears on or in a wire
service, financial news service or newspaper of general circulation or is
otherwise first made publicly available.
 
(c)           Effects of Exercise of Stock Appreciation Rights or Options.  Upon
the exercise of a Stock Appreciation Right, the number of shares of Common Stock
available under the Option to which it relates shall decrease by a number equal
to the number of shares for which the Stock Appreciation Right was exercised.
Upon the exercise of an Option, any related Stock Appreciation Right shall
terminate as to any number of shares of Common Stock subject to the Stock
Appreciation Right that exceeds the total number of shares for which the Option
remains unexercised.
 
(d)           Time of Grant.  A Stock Appreciation Right must be granted
concurrently with the Option to which it relates.
 
(e)           Non-Transferable.  The holder of a Stock Appreciation Right may
not transfer or assign the Stock Appreciation Right otherwise than by will or in
accordance with the laws of descent and distribution, and during a holder's
lifetime a Stock Appreciation Right may be exercisable only by the holder.
 
 
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ARTICLE IX
ADJUSTMENTS FOR CAPITAL CHANGES
 
9.01           General Adjustments.  The aggregate number of shares of Common
Stock available for issuance under this Plan, the number of shares to which any
Award relates and the exercise price per share of Common Stock under any Option
or Stock Appreciation Right shall be proportionately adjusted for any increase
or decrease in the total number of outstanding shares of Common Stock issued
subsequent to the Effective Date of this Plan resulting from a split,
subdivision or consolidation of shares or any other capital adjustment, the
payment of a stock dividend, or other increase or decrease in such shares
effected without receipt or payment of consideration by the Corporation.
 
9.02           Adjustments for Mergers and Other Corporate Transactions.  If,
upon a merger, consolidation, reorganization, liquidation, recapitalization or
the like of the Corporation, the shares of the Corporation's Common Stock shall
be exchanged for other securities of the Corporation or of another corporation,
each Award shall be converted, subject to the conditions herein stated, into the
right to purchase or acquire such number of shares of Common Stock or amount of
other securities of the Corporation or such other corporation as were
exchangeable for the number of shares of Common Stock of the Corporation which
such optionees would have been entitled to purchase or acquire except for such
action, and appropriate adjustments shall be made to the per share exercise
price of outstanding Options and Stock Appreciation Rights, provided that in
each case the number of shares or other securities subject to the substituted or
assumed stock options and stock appreciation rights and the exercise price
thereof shall be determined in a manner that satisfies the requirements of
Treasury Regulation §1.424-1 and the regulations issued under Section 409A of
the Code so that the substituted or assumed option is not deemed to be a
modification of the outstanding Options or Stock Appreciation
Rights.  Notwithstanding any provision to the contrary herein, the term of any
Option or Stock Appreciation Right granted hereunder and the property which the
Optionee shall receive upon the exercise or termination thereof shall be subject
to and be governed by the provisions regarding the treatment of any such Options
or Stock Appreciation Rights set forth in a definitive agreement with respect to
any of the aforementioned transactions entered into by the Corporation to the
extent any such Option and Stock Appreciation Right remains outstanding and
unexercised upon consummation of the transactions contemplated by such
definitive agreement.
 
 
ARTICLE X
AMENDMENT AND TERMINATION OF THE PLAN
 
The Board may, by resolution, at any time terminate or amend the Plan with
respect to any shares of Common Stock as to which Awards have not been granted,
subject to any required stockholder approval or any stockholder approval which
the Board may deem to be advisable for any reason, such as for the purpose of
obtaining or retaining any statutory or regulatory benefits under tax,
securities or other laws or satisfying any applicable stock exchange listing
requirements.  The Board may not, without the consent of the holder of an Award,
alter or impair any Award previously granted or awarded under this Plan as
specifically authorized herein.  Notwithstanding anything contained in this Plan
to the contrary, the provisions of Articles V, VII and VIII of this Plan
relating to Awards granted to Non-Employee Directors shall not be amended more
than once every six months, other than to comport with changes in the Code, the
Employee Retirement Income Security Act of 1974, as amended, or the rules and
regulations promulgated under such statutes.
 
 
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ARTICLE XI
EMPLOYMENT RIGHTS
 
Neither the Plan nor the grant of any Awards hereunder nor any action taken by
the Committee or the Board in connection with the Plan shall create any right on
the part of any Employee or Non-Employee Director of the Corporation or a
Subsidiary Company to continue in such capacity.
 
 
ARTICLE XII
WITHHOLDING
 
12.01     Tax Withholding.  The Corporation may withhold from any cash payment
made under this Plan sufficient amounts to cover any applicable withholding and
employment taxes, and if the amount of such cash payment is insufficient, the
Corporation may require the Optionee to pay to the Corporation the amount
required to be withheld as a condition to delivering the shares acquired
pursuant to an Award.  The Corporation also may withhold or collect amounts with
respect to a disqualifying disposition of shares of Common Stock acquired
pursuant to exercise of an Incentive Stock Option, as provided in Section
8.10(c).
 
12.02            Methods of Tax Withholding.  The Committee is authorized to
adopt rules, regulations or procedures which provide for the satisfaction of an
Optionee's tax withholding obligation by the retention of shares of Common Stock
to which the Employee would otherwise be entitled pursuant to an Award and/or by
the Optionee's delivery of previously-owned shares of Common Stock or other
property.
 
 
ARTICLE XIII
EFFECTIVE DATE OF THE PLAN; TERM
 
13.01           Effective Date of the Plan. This Plan as originally adopted
became effective on the Effective Date, and Awards may be granted hereunder no
earlier than the date this Plan was approved by stockholders and no later than
the termination of the Plan.  This Plan, as originally adopted, was approved at
meeting of stockholders held within twelve (12) months of the Effective
Date.  The amendment and restatement of this Plan was adopted effective as of
the date set forth in Article 1 hereof.
 
 
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13.02          Term of Plan.  Unless sooner terminated, this Plan shall remain
in effect for a period of ten (10) years ending on the tenth anniversary of the
Effective Date.  Termination of the Plan shall not affect any Awards previously
granted and such Awards shall remain valid and in effect until they have been
fully exercised or earned, are surrendered or by their terms expire or are
forfeited.
 
ARTICLE XIV
MISCELLANEOUS
 
14.01           Governing Law. To the extent not governed by federal law, this
Plan shall be construed under the laws of the Commonwealth of Pennsylvania.
 
14.02           Pronouns.  Wherever appropriate, the masculine pronoun shall
include the feminine pronoun, and the singular shall include the plural.
 
 
 
 
 
 
 
 

 
 
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