EXHIBIT 20.1
<PAGE>


                             FIDELITY BANCORP, INC.
              Dividend Reinvestment and Common Stock Purchase Plan
                         100,000 Shares of Common Stock
                                ($0.01 par value)
              ----------------------------------------------------

This Prospectus  relates to 100,000 shares of Common Stock,  par value $0.01 per
share (the  "Common  Stock")  of  Fidelity  Bancorp,  Inc.  (the  "Corporation")
registered for purchase under the Fidelity Bancorp,  Inc. Dividend  Reinvestment
and Common Stock Purchase Plan (the "Plan").  By a Registration  Statement filed
with the Securities and Exchange  Commission (the  "Commission")  on January 11,
1994, of which this Prospectus is a part, the Corporation is registering 100,000
shares for issue  pursuant to the Plan.  The Plan provides each holder of Common
Stock  with a simple  and  convenient  method of  purchasing  additional  shares
without  payment of any brokerage  commission,  service  charge or other similar
expense.

A participant  in the Plan may elect either to reinvest  dividends on all of his
shares of Common Stock and/or to make  optional  cash  payments of not less than
$10 each  purchase up to a maximum of $3,500 per quarter and continue to receive
regular  dividend  payments  on his other  shares.  Participants  who  enroll to
reinvest  dividends  may also make  optional  cash payments of not less than $10
each purchase up to a maximum of $3,500 per quarter.  A participant may withdraw
from the Plan at any time.

The  purchase  price of  shares  purchased  by a  participant  in the Plan  with
reinvested  dividends on any investment  date will be 100% of the average of the
daily  high and low sales  prices of the shares  quoted on the  NASDAQ  National
Market System on the investment  date.  The purchase  price of shares  purchased
with  optional  cash  payments  will also be 100% of such  average.  Since  such
additional  shares  of  Common  Stock  will  be  purchased   directly  from  the
Corporation, the Corporation will receive additional funds for general corporate
purposes.

The Plan does not represent a change in the dividend policy of the  Corporation,
which will  continue to depend on  earnings,  financial  requirements  and other
factors.  Shareholders  who do not wish to participate in the Plan will continue
to receive  cash  dividends  as  declared  by check in the usual  manner.  It is
suggested that this Prospectus be retained for future reference.

          THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
        SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
              UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
              REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                  The date of this Prospectus is July 30, 1998.


                              AVAILABLE INFORMATION

The Corporation is subject to the  informational  requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange  Act"),  and in accordance there
with files, reports and other information with the Commission.

Reports,  proxy statements and other  information  filed by the Corporation with
the  Commission can be inspected and copied at the public  reference  facilities
maintained  by the  Commission  at  Judiciary  Plaza,  450 Fifth  Street,  N.W.,
Washington,  D.C.  20549.  Copies  of this  material  can  also be  obtained  at
prescribed  rates  either  in  person  at  the  Commission's   public  reference
facilities  or by mail  addressed to the  Securities  and  Exchange  Commission,
Public Reference Section, Washington, D.C. 20549.

This  Prospectus  does not contain all of the  information  in the  Registration
Statement on Form S-3 filed with the  Commission  of which this  Prospectus is a
part.  Certain  portions  of the  Registration  Statement  have been  omitted in
accordance  with the  rules  and  regulations  of the  Commission.  For  further
information  with respect to the Corporation and the securities  offered hereby,
reference is made to the Registration Statement, including the exhibits thereto.

                                       1
<PAGE>
                       DOCUMENTS INCORPORATED BY REFERENCE



The  following  documents  filed  by the  Corporation  with the  Commission  are
incorporated by reference in this Prospectus:


1.   The  Corporation's  Registration  Statement on Form S-4  (Registration  No.
     33-55384) filed with the Commission on December 3, 1992.

2.   The  Corporation's  Annual  Report  on Form  10-KSB  and  Annual  Report to
     Shareholders for the year ended September 30, 1993.

3.   The  Corporation's  definitive  Proxy  Statement  dated January 10, 1994 in
     connection with the 1994 Annual Meeting of shareholders.

4.   The  description  of  the  Corporation's  Common  Stock  contained  in  its
     registration statement on Form 8-B dated August 9, 1993 filed under Section
     12 of the Exchange Act,  including all amendments and reports filed for the
     purpose of updating such description.


All other reports filed by the  Corporation  pursuant to Sections 13(a) or 15(d)
of the Exchange Act since  September 30, 1993, are deemed to be  incorporated by
reference.

All documents filed by the Corporation  pursuant to Sections 13(a), 13(c), 14 or
15(d) of the  Exchange  Act after the date of this  Prospectus  and prior to the
termination  of the offering made hereby shall be deemed to be  incorporated  by
reference in this  Prospectus and to be a part hereof from the date of filing of
such documents.

The  Corporation  will  provide  without  charge  to each  person  to whom  this
Prospectus is delivered,  on the oral or written request of such person,  a copy
of any or all of the foregoing  documents  incorporated  by reference other than
certain exhibits. Written requests should be directed to:

                             Richard G. Spencer
                             Vice President
                             Treasurer and CFO
                             Fidelity Bancorp, Inc.
                             1009 Perry Highway
                             Pittsburgh, Pennsylvania  15237

Telephone requests may be directed to the Corporation at (412) 367-3300.



This Prospectus does not constitute an offer to sell, or the  solicitation of an
offer  to  buy,  the  securities  to  which  this  Prospectus   relates  in  any
jurisdiction  to any  person  to whom it is  unlawful  to make  such an offer or
solicitation  in such  jurisdiction.  No person has been  authorized to give any
information  or to make  any  representation  other  than as  contained  in this
Prospectus in connection  with the offer  contained in this  Prospectus  and, if
given or made,  such  information or  representation  must not be relied upon as
having been  authorized.  Neither the delivery of this  Prospectus  nor any sale
hereunder shall under any  circumstances  imply that there has been no change in
the  affairs  of the  Corporation  since the date  hereof.  In that  connection,
reference is made to the section of this prospectus captioned  "Incorporation of
Certain Documents by Reference

                                       2
<PAGE>



                                TABLE OF CONTENTS

                                                                         Page
                  The Corporation......................................
                  The Plan.............................................
                  Purpose..............................................
                  Participation Options................................
                  Advantages...........................................
                  Administration.......................................
                  Participation........................................
                  Purchases............................................
                  Optional Cash Purchases..............................
                  Expenses.............................................
                  Federal Income Tax Consequences to Participants......
                  Reports to Participants..............................
                  Dividends............................................
                  Certificates of Shares...............................
                  Termination of Participation in the Plan.............
                  Withdrawal of Shares in Plan Accounts ...............
                  Other Information....................................
                  Use of Proceeds......................................
                  Experts..............................................
                  Legal Opinions.......................................
                  Indemnification......................................

                                 THE CORPORATION

The Corporation is a bank holding  company.  Its banking  subsidiary is Fidelity
Bank,  PaSB (the "Bank").  The Bank is a Pennsylvania  - chartered  savings bank
offering a full range of banking  services  permitted to savings  banks  through
eight (8)  locations  in  Allegheny  and Butler  Counties,  Pennsylvania.  As of
September 30, 1993,  the  Corporation  had total assets of  $267,204,993,  total
deposits of $234,090,602,  net loans of $106,585,286 and shareholders  equity of
$18,543,685.  The  Corporation's  registered  office is  located  at 1009  Perry
Highway, Pittsburgh, PA 15337, telephone 412-367-3300.

                                       3
<PAGE>

                                    THE PLAN

The following  questions and answers  explain and constitute  the  Corporation's
Dividend Reinvestment and Common Stock Purchase Plan (the "Plan").

Purpose
-------

1.       What is the purpose of the Plan?

The  purpose  of the Plan is to  provide  holders  of  record  of  shares of the
Corporation's  Common Stock with a convenient and economical method of investing
cash  dividends and optional cash payments in additional  shares of Common Stock
without  payment  of any  brokerage  commission  or service  charge.  Since such
additional  shares  of  Common  Stock  will  be  purchased   directly  from  the
Corporation, and not on the open market, the Corporation will receive additional
funds for general corporate purposes.

Participation Options
---------------------

2.       What options are available to participants in the Plan?

As a participant (hereinafter "participant" or "you") in the Plan:

You may have cash  dividends  on all,  but not less than all,  of your shares of
Common Stock automatically reinvested, and also, if you wish, make optional cash
purchases  of not less than  $10.00  each  purchase  up to a total of $3,500 per
calendar  quarter;  or you may make optional cash purchases of not less than $10
each  purchase  up to a total  of  $3,500  per  calendar  quarter,  even if your
dividends on Common Stock held by you are not being reinvested.

Advantages
----------

3.       What are the advantages of the Plan?

a)   The price of shares purchased with reinvested dividends will be 100% of the
     market  price  average as defined in the response to Question 12. The price
     of shares  purchased  with optional cash payments also will be 100% of such
     market price average.

b)   No  brokerage  commissions  or  service  charges  will  be  paid  by you in
     connection with any purchases made under the Plan.

c)   Your funds will be fully invested in the Corporation's Common Stock because
     the Plan  permits  fractional  shares to be credited to your Plan  account.
     Dividends on such fractional  shares,  as well as on whole shares,  will be
     reinvested  in  additional  shares and such  shares  credited  to your Plan
     account.

                                       4
<PAGE>

d)   You will avoid the need for  safekeeping  of stock  certificates  of shares
     credited to your Plan account.

e)   Periodic  statements  reflecting all current activity,  including purchases
     and latest balance, will simplify your record keeping.

Administration
--------------

4.       Who administers the Plan for participants?

Registrar and Transfer  Company will  administer  the Plan,  keep records,  send
statements of account to each  participant,  and perform other duties related to
the  Plan.  Shares  purchased  for you  under  the Plan  will be held for you in
safekeeping by or through Registrar and Transfer Company until a written request
is received  from you for the issuance of  certificates  for all or part of your
shares as more fully  explained in the response to Question  21.  Registrar  and
Transfer  Company also acts as dividend  disbursing  and transfer  agent for the
Corporation's Common Stock.

Shares  purchased with  reinvested  dividends and optional cash payments will be
registered in the name of Registrar and Transfer Company as nominee.  You should
continue to hold any shares  presently or  subsequently  registered in your name
and should not  undertake  to  transfer  such  shares to the  Corporation  or to
Registrar and Transfer Company.

Participation
-------------

5.       Who is eligible to participate?

If you are a holder of Common Stock and you have shares registered in your name,
you are eligible to  participate.  If your stock is  registered  in a name other
than your own,  (e.g.  in the name of a broker or nominee) and you would like to
participate,  you must either make  appropriate  arrangements for your broker or
nominee to  participate  on your  behalf,  or you must become a  shareholder  of
record by having  those  shares  with  respect to which you wish to  participate
transferred to your name.

You  will  not be  eligible  to  participate  in the  Plan  if you  reside  in a
jurisdiction  in  which  it is  unlawful  for the  Corporation  to  permit  your
participation.

Your right to participate in the Plan is not transferable  apart from a transfer
of your Common Stock to another person.

6.       Is partial participation possible under the Plan?

                                       5
<PAGE>

Generally,  no. If you elect to have  dividends  on your shares of Common  Stock
reinvested  under the Plan, such  reinvestment  must be made with respect to all
the shares which are registered in your name.

In  addition,  a broker  or  nominee  holding  Common  Stock  for more  than one
beneficial  owner  may  participate  in the Plan on behalf of less than all such
beneficial owners, provided that the dividends on all the shares of Common Stock
held on  behalf of each  beneficial  owner  participating  in the Plan are being
reinvested.

7.   How does an eligible  shareholder  participate  or change options under the
     Plan?

As a holder of record of Common Stock,  you may join the Plan by completing  and
signing an Enrollment  Card and returning it to Registrar and Transfer  Company.
Once  enrolled in the Plan,  you will  continue to be enrolled  without  further
action on your  part.  You may  change  your  investment  options at any time by
completing and signing a new  Enrollment  Card and returning it to Registrar and
Transfer  Company.  If your  shares are  registered  in more than one name (i.e.
joint tenants,  trustees,  etc.) all registered holders must sign the Enrollment
Card.

You may obtain an Enrollment Card at any time by contacting:

                           Registrar and Transfer Company
                           10 Commerce Drive
                           Cranford, NJ  07016
                           1-800-866-1340

8.   When may an eligible shareholder join the Plan?

As an eligible shareholder,  you may join the Plan at any time.  Reinvestment of
dividends  on Common  Stock  will  start with the next  Common  Stock  quarterly
dividend  payment,  provided  the  Enrollment  Card is received on or before the
record  date of such  dividend.  If the  Enrollment  Card is not  received on or
before  the  record  date  of such  dividend,  it will  be  necessary  to  delay
reinvestment of dividends until the next quarterly  payment date for such stock.
Record dates for dividends  paid by the  Corporation  usually  precede  dividend
payment  dates by five  business  days.  Ordinarily  dividend  payment dates are
twenty  business days  following the  quarterly  declaration  dates which are in
January, April, July and October each year.

See the response to Question 13 for  information  on making an initial  optional
cash purchase.

You will remain a  participant  in the Plan until you elect to  discontinue  the
reinvestment of dividends,  or sell or otherwise dispose of all the Common Stock
held in your name and withdraw all shares of Common Stock  credited to your Plan
account.


                                       6
<PAGE>

The Plan does not represent a change in the  Corporation's  dividend policy or a
guarantee of future dividends, which will continue to be determined by the Board
of Directors  based upon the  Corporation's  earnings,  financial  condition and
other factors.



9.       What does the Enrollment Card provide?

The  Enrollment  Card  provides  for the  purchase of  additional  shares of the
Corporation's Common Stock through the following investment options;

a)       "Full Common Stock Dividend Reinvestment"

This option directs the  Corporation to invest in accordance  with the Plan cash
dividends on all shares of Common Stock currently or subsequently  registered in
your name and on all whole and  fractional  shares of Common  Stock  credited to
your Plan  account.  This option also permits you to make optional cash payments
for the purchase of  additional  shares of Common Stock in  accordance  with the
Plan; and

b)       "Optional Cash Purchases Only"

This option  permits you to make  optional  cash  payments  for the  purchase of
additional  shares  of  Common  Stock  in  accordance  with  the  Plan,  without
reinvesting  dividends on Common Stock held by you. If you desire this option, a
check payable to Fidelity  Bancorp,  Inc.  covering  your initial  optional cash
purchase must accompany your Enrollment Card. Cash dividends on shares purchased
with  optional  cash  payments  will  automatically  be reinvested in additional
shares of Common  Stock.  If you wish to receive cash  dividends on such shares,
you must withdraw the shares from your Plan account by written  notification  to
Registrar  and  Transfer  Company at the  address  set forth in the  response to
Question 7.

Purchases
---------

10.      How are shares of Common Stock acquired under the Plan?

Registrar and Transfer  Company will apply  dividends and optional cash payments
to acquire newly issued shares of the Corporation's Common Stock for the account
of  participants.  Shares acquired under all options of the Plan will consist of
authorized  but  unissued  shares  and  will  be  purchased  directly  from  the
Corporation

11.      How many shares will be purchased for participants?

The number of shares that will be purchased  for a  participant's  account on an
Investment  Date (as defined in the  response to Question 12) will depend on the
amount of any  dividends  and any  optional  cash  payments  and the  applicable
purchase price of the Common Stock.  Your Plan

                                       7
<PAGE>

account will be credited  with the number of shares  (including  any  fractional
share computed for four decimal places) that results from dividing the amount of
dividends  and any  optional  cash  payments to be  invested  by the  applicable
purchase  price.  The amount of your dividends for purposes of this  computation
will include cash  dividends  payable on all shares of Common Stock with respect
to  which  you are  participating  and  shares  in your  Plan  account,  whether
purchased with reinvested dividends or optional cash payments.

12.  When and at what price will shares of Common Stock be  purchased  under the
     Plan?

Shares of Common  Stock will be purchased  once each  quarter on the  Investment
Date,  which will be the dividend payment date during months in which a dividend
is paid on the Common Stock.  However,  if the  Investment  Date falls on a date
when the NASDAQ  National  Market  System is closed,  the first day  immediately
succeeding such day on which that market is open will be the Investment Date.

For the  purpose  of making  purchases,  Registrar  and  Transfer  Company  will
comingle  your  funds  with  those of other  holders  of  Common  Stock  who are
participants  in the  Plan.  Registrar  and  Transfer  Company  will  apply  any
dividends  and any  optional  cash  payments  to the  purchase  of Common  Stock
pursuant to the Plan on the Investment  Date,  except when prohibited  under any
applicable  federal or estate securities laws. No interest will be paid on funds
held by Registrar and Transfer Company.

Shares  purchased  under the Plan with either  reinvested  dividends or optional
cash payments will be acquired by  participants at 100 percent of the average of
the high and low sales  prices of shares  of  Common  Stock as  reported  on the
NASDAQ National Market System on the Investment  Date. If there is no trading on
that date of  shares  of Common  Stock,  the  purchase  price per share  will be
determined by the  Corporation  on the basis of such market  quotations as shall
deem appropriate.

Optional Cash Purchases
-----------------------

13.  How are optional cash purchases made?

The option to make cash purchases is available to you at the time of joining the
Plan by properly  completing  and  signing an  Enrollment  Card.  If you wish to
enroll in the  "Optional  Cash  Purchase  Only"  feature of the Plan, a check or
money order payable to Fidelity Bancorp,  Inc. covering your first optional cash
purchase must  accompany  your  Enrollment  Card. Do not send cash.  Thereafter,
additional  optional cash purchases may be made through the use of the form sent
with each periodic statement.

Each  optional  cash payment made by you must be at least $10, and such payments
cannot, in any one calendar quarter,  exceed a total of $3,500.  The same amount
of money need not be sent

                                       8
<PAGE>

each calendar quarter and there is no obligation to make any additional optional
cash purchases after enrollment in the Plan.

Optional  cash  payments  received  from  foreign  participants  must be in U.S.
dollars.

14.  When will optional cash payments received be invested?

Optional cash payments must be received from you at least five days but not more
than 30 days prior to an Investment  Date and will be applied to the purchase of
shares of Common Stock for your account on such  Investment  Date. Cash payments
will be  invested  once  each  quarter.  Listed  on each  Dividend  Reinvestment
Statement are the dates between which the next cash payments will be accepted by
Registrar  and  Transfer  Company.  No interest  will be paid on  optional  cash
payments pending investment. Participants cannot specify the price or timing, or
place any other limitations on the purchase of shares other than those specified
herein.


15.  Under what circumstances will optional cash payments be returned?

Your  uninvested  optional  cash  payments  will be returned to you upon written
request  received by Registrar  and Transfer  Company at least two business days
prior to an Investment Date or if they are received more than 30 days before the
next scheduled dividend is to be paid.

Expenses
--------

16.  Are there any expenses to  participants  in connection  with purchase under
     the Plan?

No. There are no brokerage  commissions  because  shares are purchased  directly
from the Corporation. All expenses of administration of the Plan are paid by the
Corporation. However, if you request Registrar and Transfer Company to sell your
shares in the event of withdrawal  from the Plan as explained in the response to
Question 26, you must pay any brokerage  commission and any applicable  transfer
tax incurred.

Federal Income Tax Consequences to Participants
-----------------------------------------------

17.  What are the Federal income tax consequences of participation in the Plan?

The  following  summary  is  based  upon an  interpretation  by  counsel  to the
Corporation of present  Federal tax laws,  regulations  and rulings,  and may be
inapplicable  if such laws,  regulations  or  rulings  are  changed.  You should
consult your own tax advisor to determine the particular tax  consequences  that
may result from participation in the Plan and the subsequent  disposal of shares
purchased pursuant to the Plan.




                                       9
<PAGE>

You will be treated, for Federal income tax purposes, as having received, on the
dividend date, a dividend equal to the fair market value of the shares  acquired
with the reinvested  dividends on such dividend  payment date, and will be taxed
accordingly.  The tax basis of those  shares will equal the fair market value of
such  shares  on the  dividend  payment  date.  If you  are  subject  to  backup
withholding,  31% of the cash dividends otherwise payable will be required to be
withheld as the 69% balance will be reinvested in shares, the tax basis of which
will be the fair  market  value on the  dividend  payment  date of the shares so
acquired with the 69% balance.

You will not  realize  any  taxable  income  upon the  purchase  of shares  with
optional cash payments  since shares  purchased  with optional cash payments are
purchased at 100% of fair market value.  The tax basis of shares  purchased with
optional cash payments will equal your purchase price per share.

Your holding period for shares  acquired  pursuant to the Plan will begin on the
day following the Investment Date on which the shares were purchased.

You will not realize any taxable income when you receive  certificates for whole
shares credited to your account, either upon your request for a portion of those
shares or upon withdrawal from or termination of the Plan.

You will realize gain or loss when shares are sold or exchanged,  whether by the
Plan  pursuant to your  request  upon  withdrawal  from the Plan or by you after
receipt of shares  from the Plan.  You will also  realize  gain or loss when you
receive a cash  payment for the sale of a fraction  of a share  credited to your
account upon withdrawal from or termination of the Plan. The amount of such gain
or loss will be the  difference  between  the amount  that you  receive  for the
shares or fraction of a share and your tax basis thereof.

Under a law which became effective January 1, 1984, every shareholder  receiving
payments of  dividends is required to provide the pay or with his or her correct
social  security  or  taxpayer  identification  number.  If this  number  is not
furnished or if an incorrect  number is furnished,  then the shareholder will be
subject to backup withholding.

A shareholder will also be subject to backup  withholding if the shareholder has
failed to  correctly  report  interest  and  dividend  payments to the  Internal
Revenue Service or has failed to file a required tax return  reporting  interest
and  dividends,  in which case the Internal  Revenue  Service will so notify the
shareholder  and the  Corporation.  Finally,  a  shareholder  will be subject to
backup withholding with respect to dividends paid on shares acquired on or after
January 1, 1984 if the shareholder  fails to certify that the social security or
taxpayer  identification number furnished to the Corporation is correct and that
the shareholder is not otherwise  subject to backup  withholding.  A shareholder
will be subject to backup withholding on the gross proceeds received upon a sale
of shares if the shareholder does not provide his or her taxpayer identification
or social security number to the broker through whom the transaction is effected
(or to Registrar and Transfer Company in the case of sales effected by Registrar
and  Transfer  Company  pursuant  to the  Plan) in the  manner  required  or the
Internal  Revenue Service  notifies the broker that the number  furnished by the
shareholder is incorrect.

                                       10
<PAGE>

For shareholders  subject to backup withholding,  the Corporation is required to
withhold  thirty-one  percent (31%) of each dividend payment as tax. Upon a sale
of shares  (including any cash payment for fractional  shares),  the broker must
withhold  31% of the gross  proceeds  if the  shareholder  is  subject to backup
withholding.  The  amount  withheld  pursuant  to backup  withholding  is not an
additional tax. Rather, the Federal income tax liability of the shareholder will
be reduced by the amount of tax withheld.  If backup withholding  results in any
overpayment  of taxes,  a refund may be  obtained  by the  shareholder  from the
Internal Revenue Service.

The backup  withholding  rules described above apply whether or not a particular
shareholder  elects to  participate  in the Plan.  If you are  subject to backup
withholding,  the amount of tax withheld  will be deducted from the total amount
of  dividends  paid and only the  remaining  balance  of the  dividends  will be
available for reinvestment under the Plan.

18.  How are income tax withholding provisions applied to foreign shareholders?

In the case of a foreign  participant  whose income is subject to withholding of
U.S. Federal income tax, the appropriate  amount of tax will be withheld and the
balance will be reinvested.

Reports to Participants
-----------------------

19.  What reports will be sent to participants in the Plan?

As soon as practical after each purchase of Common Stock under the Plan for your
account,  a  statement  of  account  will be mailed to you,  normally  within 15
business  days  following  the  Investment   Date.  These  statements  are  your
continuing  record of current  activity and cost of your  purchase and should be
retained  for  tax   purposes.   In  addition,   you  will  receive   copies  of
communications sent to all holders of the Corporation's Common Stock,  including
the  Corporation's  Quarterly  Reports and Annual  Report to  Shareholders,  the
Notice of Annual Meeting and Proxy  Statement and  information you will need for
reporting your dividend income for Federal income tax purposes.

Each quarterly  statement of account will show the price per share to be used in
determining  the tax basis of the Common  Stock  purchased  in that quarter with
reinvested  dividends  and any optional  cash  payments to the Plan. An Internal
Revenue  Service  Form (Form  1099) will be mailed to  participants  at year end
showing the total amount of dividend  income to be reported by each  participant
and the total amount of tax, if any, withheld.

Dividends
---------

20.  Will  participants  be  credited  with  dividends  on shares  held in their
     accounts under the Plan?

                                       11
<PAGE>

Yes.  Dividends  on all shares of Common  Stock,  including  fractional  shares,
credited  to  your  Plan  account,  whether  such  shares  were  purchased  with
reinvested dividends on Common Stock held by you or with optional cash payments,
will be automatically reinvested in additional shares of Common Stock until such
shares are withdrawn from your Plan account.

Certificates for Shares
-----------------------

21.  Will certificates be issued for shares purchased?

No.  Certificates  will not be issued to you for  shares  credited  to your Plan
account unless you request in writing that Registrar and Transfer Company do so,
whether upon  termination  of your  participating  in the Plan or otherwise,  or
unless  the Plan is  terminated.  Shares  purchased  through  the  Plan  will be
credited to your Plan  account,  but they will not be  registered  in your name.
Shares of  Common  Stock  purchased  under  the Plan and held by  Registrar  and
Transfer  Company  will be  registered  in the name of  Registrar  and  Transfer
Company nominee and credited to your Plan account. The number of shares credited
to your Plan account. The number of shares credited to your Plan account will be
shown on the periodic  statement of your account.  This service  eliminates  the
need for  safekeeping  by you to protect  against loss,  theft or destruction of
stock certificates.

At any time, you may request in writing that Registrar and Transfer Company send
you a  certificate  for all or part of the whole  shares  credited  to your Plan
account.  This request should be mailed to Registrar and Transfer Company at the
address  set  forth in the  response  to  Question  7. Any  remaining  whole and
fractional   shares  will   continue  to  be  credited  to  your  Plan  account.
Certificates for fractional  shares will not be issued under any  circumstances.
Certificates  for whole shares  credited to your Plan  account will  normally be
issued within 10 business  days of receipt by Registrar and Transfer  Company of
your written request.

22.  In whose name will certificates be registered when issued to participants?

Plan accounts are  maintained in the name in which your shares are registered at
the time you enroll in the Plan.  Consequently,  certificates  for whole  shares
purchased  under the Plan will be similarly  registered  when issued to you upon
your request.

23.  May shares in a Plan account be pledged?

No. Shares  credited to your Plan account may not be pledged or assigned and any
such  purported  pledge or  assignment  shall be void.  If you wish to pledge or
assign such shares, you must withdraw such shares from your Plan account.

Termination of Participation in the Plan
----------------------------------------

24.  How does a participant terminate participation in the Plan?


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<PAGE>

You may  direct  Registrar  and  Transfer  Company  in  writing  at any  time to
discontinue the reinvestment of dividends on Common Stock held of record by you.
This notice  should be mailed to Registrar  and Transfer  Company at the address
set forth in the  response  to  Question  7.  After  initial  enrollment  in the
Optional  Cash Purchase  Only option,  you are never  obligated to make optional
cash purchases.  Optional cash purchases may be made even after you have elected
to discontinue the  reinvestment of dividends on Common Stock registered in your
name.

If you elect to discontinue  the  reinvestment of dividends on Common Stock held
of record in your name, you may either withdraw the whole shares of Common Stock
credited to your Plan account (see the response to Question 26) or retain any or
all such shares in such account. Dividends on shares of Common Stock retained in
your Plan account will continue to be reinvested.

25.  When may a participant terminate participation in the Plan?

You  may  terminate  your  participation  in the  "Full  Common  Stock  Dividend
Reinvestment"  option under the Plan at any time. If your notice to  discontinue
reinvestment is received by Registrar and Transfer Company at least ten business
days before the record date for the cash  dividend,  the next  dividend  will be
paid to you in cash. If your notice to discontinue  reinvestment  is received by
Registrar  and Transfer  Company  less than ten business  days before the record
date for the  cash  dividend,  the next  dividend  will be  reinvested  for your
account.  Thereafter, all dividends on Common Stock held of record by you, as to
which you have terminated participation,  will be paid to you in cash unless you
elect to enroll in the dividend reinvestment option of the Plan again, which you
may do at any time.

Any optional  cash  payment  which has been  received by Registrar  and Transfer
Company prior to receipt of a notice to discontinue  dividend  reinvestment will
be  invested  in  accordance  with the Plan  unless  return  of the  payment  is
expressly  requested in a notice received at least two business days prior to an
Investment Date.

Withdrawal of Shares in Plan Accounts
-------------------------------------

26.  How does a participant withdraw shares purchased under the Plan?

You may withdraw all or a portion of the shares of Common Stock credited to your
Plan account by notifying Registrar and Transfer Company in writing,  specifying
the number of shares to be withdrawn.  This notice should be mailed to Registrar
and  Transfer  Company at the address  set forth in the  response to Question 7.
Certificate  for whole shares of Common Stock so withdrawn will be issued to you
as soon as practicable after receipt of your written  response.  In no case will
certificates for fractional shares be issued.

If your notice of withdrawal  is not received by Registrar and Transfer  Company
at least ten  business  days before the record date for the  dividend,  the next
dividend  will be  reinvested  for your  account.  After you withdraw  shares of
Common Stock from your Plan account, cash

                                       13
<PAGE>

dividends on such shares will continue to be  reinvested in accordance  with the
Plan if you are enrolled  under the "Full Common  Stock  Dividend  Reinvestment"
option of the Plan or, if not, will be paid to you in cash.

You may, if you wish,  also  request  that all or a portion of the shares,  both
whole and  fractional,  credited to your Plan account be sold. Such request must
be in writing and signed by each person in whose name the Plan account  appears.
If such sale is  requested,  Registrar  and Transfer  Company  will,  as soon as
practicable  after  receiving  the request,  place a sale order for your account
through a broker. You will receive a check for the proceeds of the sale less any
brokerage commission and any applicable transfer tax incurred.



27.  What happens to any fractional share when you direct Registrar and Transfer
     Company to sell, or otherwise withdraw, all shares from your Plan account?

Any fractional share in your Plan account will be sold by Registrar and Transfer
Company and a cash payment made for the sale price thereof less any transfer tax
incurred.  The  net  proceeds  for  any  fractional  share,  together  with  any
certificates for whole shares, will be mailed to you.

Other Information
-----------------

28.  What  happens  when you sell or  transfer  all of the Common  Stock held of
     record in your name?

If you dispose of all Common Stock  Securities  held of record in your name, the
dividends  on the shares  credited to your Plan  account  (held of record in the
name of the agent's  nominee) will  continue to be  reinvested  until you notify
Registrar  and  Transfer  Company that you wish to withdraw all shares of Common
Stock credited to your Plan account.

29.  What happens when you sell or transfer some but not all of the Common Stock
     held of record in your name?

If you are reinvesting the dividends on the shares of Common Stock registered in
your name and you  dispose of a portion of such  shares,  the  Corporation  will
continue to reinvest the  dividends on the remainder of the shares for which you
have elected to have dividends reinvested and which are registered in your name.

30.  What happens if the Corporation declares a stock dividend or a stock split?

Shares  of Common  Stock  distributed  by the  Corporation  pursuant  to a stock
dividend or a stock  split with  respect to shares of Common  Stock  credited to
your Plan account will be added to your account.

                                       14
<PAGE>

Shares distributed pursuant to a stock dividend or a stock split with respect to
shares of Common Stock registered in your name will be mailed to you.

31.  How will a participant's  shares held by Registrar and Transfer  Company be
     voted at shareholders meetings?

Shares  held by  Registrar  and  Transfer  Company  for you will be voted as you
direct.  A proxy  card  will be sent to you in  connection  with any  annual  or
special  meeting  of   shareholders,   as  in  the  case  of  shareholders   not
participating  in the Plan. This proxy will apply to all shares credited to your
Plan  account  and, if properly  signed,  will be voted in  accordance  with the
instructions that you give on the proxy card.

As in the case of shareholders not participating in the Plan, if no instructions
are indicated on a properly  signed and returned  proxy card,  all of the shares
credited  to  your  Plan   account  will  be  voted  in   accordance   with  the
recommendations  of the  Corporation's  management.  If the  proxy  card  is not
returned or is returned  unsigned,  your shares  would be voted only if you or a
duly appointed representative vote in person at the meeting.


32.  What is the  responsibility  of the  Corporation and Registrar and Transfer
     Company under the Plan?

The Corporation and Registrar and Transfer  Company,  in administering the Plan,
will not be liable for any act done in good faith or for any good faith omission
to act,  including,  without  limitation,  any claim of liability arising out of
failure to terminate a participant's account upon such participant's death prior
to receipt of notice in writing of such death,  or any claim with respect to the
timing or the price of any purchase or sale.

Participants  should  recognize that neither the  Corporation  nor Registrar and
Transfer  Company can assure them of a profit or protect  them against a loss on
shares purchased or sold under the Plan.


33.  May the Plan be changed or discontinued?

The Corporation reserves the right to suspend or terminate the Plan at any time,
including  the period  between a dividend  record date and the related  dividend
payment date. The Corporation  also reserves the right to make  modifications to
the Plan.  Participant will be notified of any such  suspension,  termination or
modification.  Upon a  termination  of the  Plan,  except  in the  circumstances
described  below,  any  uninvested  optional cash  payments will be returned,  a
certificate for whole shares credited to your Plan account will be issued, and a
cash payment will be made for any fractional share credited to your account.


                                       15
<PAGE>

In the event the Corporation terminates the Plan for the purpose of establishing
another dividend  reinvestment  and Common Stock purchase plan,  participants in
the Plan will be enrolled  automatically  in such other plan and shares credited
to their Plan account will be credited  automatically to such other plan, unless
notice is received to the contrary.

The  Corporation  also  reserves  the  right  to  terminate  any   shareholder's
participation in the Plan at any time.




34.  How may shareholders obtain answers to other questions regarding the Plan?

Any additional questions should be addressed to:

                           Registrar and Transfer Company
                           10 Commerce Drive
                           Cranford, NJ  07016
                           800-368-5948 or 800-346-6084

35.  How is the Plan to be interpreted?

The Plan,  the  Enrollment  Card signed by  participants  and the  participants'
accounts  shall be governed by and construed in accordance  with the laws of the
Commonwealth of Pennsylvania and applicable  state and federal  securities laws,
and cannot be modified orally. Any question of interpretation  arising under the
Plan will be determined by the  Corporation and any such  determination  will be
final.

The Corporation may adopt rules and regulations to facilitate the administration
of the Plan.

36.  What are some of the responsibilities of participants?

You will have no right to draw checks or drafts  against your Plan account or to
give  instructions to Registrar and Transfer  Company with respect to any shares
of Common Stock or cash held therein except as expressly provided herein.

You should  notify  Registrar  and Transfer  Company  promptly in writing of any
change of address.  Notices to participants will be given by letter addressed to
them at their last address of record with  Registrar and Transfer  Company under
the Plan.

                                 USE OF PROCEEDS

The Corporation does not know precisely the number of shares of its Common Stock
that it will  ultimately sell under the Plan or the prices at which those shares
will be sold. The Corporation

                                       16
<PAGE>

intends  to  apply  proceeds  from the sale of  shares  pursuant  to the Plan to
general corporate purposes.

                                     EXPERTS

The financial  statements  incorporated  in this  Prospectus by reference to the
Corporation's  Annual Report on Form 10-K for the year ended  September 30, 1997
have been so  incorporated  in  reliance  on the  report  of KPMG Peat  Marwick,
independent  accountants,  given on the  authority  of said firm as  experts  in
auditing and accounting.



                                 LEGAL OPINIONS

The validity of the shares of Common Stock of the Corporation offered hereby has
been passed upon for the  Corporation  by Letson,  Jarrett & Rosenberg.  Letson,
Jarrett & Rosenberg  have also  rendered an opinion  with respect to certain tax
consequences of participation in the Plan.

                                 INDEMNIFICATION

Under  provisions of the  Corporation's  Articles of  Incorporation,  a director
shall not be  personally  liable for  monetary  damages for action  taken or for
failure to act except as limited by law;  and  directors,  officers,  agents and
employees of the  Corporation  are entitled to be indemnified in connection with
any actual or threatened  lawsuit or proceeding  arising out of their service to
the Corporation or to another organization at the request of the Corporation, or
because of their  positions  with the  Corporation.  With  respect  to  possible
indemnification   of  directors,   officers  and  controlling   persons  of  the
Corporation for liabilities arising under the Securities Act of 1933 pursuant to
such  provisions,  the  Corporation has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable.


                                       17