EXHIBIT 99.1
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INNOVATIVE SOLUTIONS AND SUPPORT, INC.
1998 STOCK OPTION PLAN
Innovative Solutions and Support, Inc. (the "Company") hereby establishes
and adopts the Innovative Solutions and Support, Inc. 1998 Stock Option Plan,
as set forth in this document.
1. Purpose. The Plan is intended to recognize the contributions made to the
Company or an Affiliate by employees of the Company or any Affiliate (as
hereinafter defined), members of the Board of Directors of the Company or any
Affiliate, and certain consultants and advisors to the Company or any
Affiliate, to provide such persons with additional incentive to devote
themselves to the future success of the Company or any Affiliate, and to
improve the ability of the Company or an Affiliate to attract, retain, and
motivate individuals upon whom the Company's sustained growth and financial
success depend, by providing such persons with an opportunity to acquire or
increase their proprietary interest in the Company through receipt of rights to
acquire the Company's Common Stock, $.001 par value (the "Common Stock").
2. Definitions. Unless the context clearly indicates otherwise, the
following terms shall have the following meanings:
(a) "Act" means the Securities Act of 1933, as amended.
(b) "Affiliate" means a corporation which is a parent corporation or a
subsidiary corporation with respect to the Company within the meaning of
Section 424(e) or (f) of the Code.
(c) "Board of Directors" means the Board of Directors of the Company.
(d) "Change of Control" shall have the meaning set forth in Section 9 of
the Plan.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Committee" means the committee designated by the Board of Directors
in accordance with the provisions of Section 3 of the Plan.
(g) "Company" means Innovative Solutions and Support, Inc., a
Pennsylvania corporation.
(h) "Disability" shall mean, in the case of an Optionee who is covered
by a disability policy or plan paid for or provided by the Company, a
condition which entitles the Optionee to benefits under the policy or plan.
If there is no such policy or plan covering the Optionee, "Disability"
shall mean a mental or physical condition which renders the Optionee
incapable of performing his duties for the Company and which is expected to
be permanent, as determined by the Committee.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "Fair Market Value" shall have the meaning set forth in Section 8(b)
of the Plan.
(k) "ISO" means an Option granted under the Plan which is an "incentive
stock option" within the meaning of Section 422(b) of the Code.
(l) "Non-qualified Stock Option" means an Option granted under the Plan
which is not intended to qualify, or otherwise does not qualify, as an ISO.
(m) "Option" means either an ISO or a Non-qualified Stock Option granted
by the Company under the Plan.
(n) "Optionee" means a person to whom an Option has been granted under
the Plan.
(o) "Option Document" means the written document described in Section 8
of the Plan evidencing the Option and setting forth the terms and
conditions upon which the Option is granted and upon which it may be
exercised.
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(p) "Option Price" means the price at which Shares may be purchased upon
exercise of an Option, as determined pursuant to Section 8(b) of the Plan.
(q) "Plan" means the Innovative Solutions and Support, Inc. 1998 Stock
Option Plan.
(r) "Shares" means the shares of Common Stock of the Company which are
the subject of Options, except as the same may be modified pursuant to the
terms of Section 10 of the Plan.
3. Administration of the Plan.
(a) Committee. The Plan shall be administered by a committee appointed by
the Board of Directors composed of two or more "outside directors" within the
meaning of Section 162(m) of the Code. No person shall be eligible or continue
to serve as a member of the Committee unless such person is an "outside
director" as aforesaid. Members of the Committee shall serve at the pleasure of
the Board of Directors which shall also fill any vacancies in the membership of
the Committee.
(b) Meetings. The Committee shall hold meetings at such times and places as
it may determine and shall keep minutes of its meetings. A majority of the
Committee shall constitute a quorum thereof, and acts approved at a meeting or
acts approved in writing by a majority of the members of the Committee shall be
the valid acts of the Committee.
(c) Grants. The Committee shall from time to time, in its discretion, direct
the Company to grant Options pursuant to the terms of the Plan. The Committee
shall have plenary authority to (i) determine the Optionees to whom, the times
at which, and the price at which Options shall be granted, (ii) determine the
type of Option to be granted and the number of Shares subject thereto, and
(iii) approve the form and terms and conditions of the Option Documents; all
subject, however, to the express provisions of the Plan. In making such
determinations, the Committee shall take into account the nature of the
Optionee's services and responsibilities, the Optionee's present and potential
contribution to the Company's success and such other factors as the Committee
may deem relevant. The interpretation and construction by the Committee of any
provisions of the Plan or of any Option granted under the Plan, and of any
Option Document, shall be final, binding and conclusive.
(d) Exculpation. No member of the Committee or of the Board of Directors
shall be personally liable for monetary damages for any action taken or any
failure to take any action in connection with the administration of the Plan or
the granting of Options under the Plan, provided that this Section 3(d) shall
not apply to (i) any breach of such member's duty of loyalty to the Company or
its shareholders, (ii) acts or omissions not in good faith or involving
intentional misconduct or a knowing violation of law, (iii) acts or omissions
that would result in liability under Section 1553 of the Pennsylvania Business
Corporation Law, as amended, or (iv) any transaction from which the member
derived an improper personal benefit.
(e) Indemnification. Service on the Committee shall constitute service as a
member of the Board of Directors. Each member of the Committee shall be
entitled without further act on his part to indemnity from the Company to the
fullest extent provided by applicable law and the Company's Articles of
Incorporation and/or By-laws in connection with or arising out of any action,
suit or proceeding with respect to the administration of the Plan or the
granting of Options thereunder in which he or she may be involved by reason of
his or her being or having been a member of the Committee, whether or not he or
she continues to be a member of the Committee at the time of the action, suit
or proceeding.
4. Grants under the Plan. Grants under the Plan may be in the form of a Non-
qualified Stock Option, an ISO or a combination thereof, at the discretion of
the Committee. More than one Option may be granted to any individual, and each
such grant may include Options which are intended to be ISOs and Options which
are not intended to be ISOs, but only on the terms and subject to the
conditions and restrictions of the Plan.
5. Eligibility. All employees and members of the Board of Directors of, and
consultants and advisors to, the Company or an Affiliate shall be eligible to
receive Options hereunder.
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6. Shares Subject to Plan. The aggregate maximum number of Shares for which
Options may be granted pursuant to the Plan is 1,259,350, subject to adjustment
as provided in Section 10 of the Plan. The maximum number of Shares with
respect to which Options may be granted under the Plan to any Employee during
any calendar year is 250,000 Shares, subject to adjustment in Section 10 of the
Plan. The Shares shall be issued from either authorized and unissued Common
Stock or Common Stock held in or hereafter acquired for the treasury of the
Company. If an Option terminates or expires without having been fully exercised
for any reason, the Shares for which the Option was not exercised may again be
the subject of further Option grants under the Plan.
7. Term of the Plan. No Option may be granted under the Plan after November
13, 2008 or the earlier termination of the Plan.
8. Option Documents and Terms. Each Option granted under the Plan shall be a
Non-qualified Stock Option unless the Option shall specifically be designated
an ISO at the time of grant. If any Option designated as an ISO is determined
for any reason not to qualify as an incentive stock option within the meaning
of Section 422 of the Code, such Option shall be treated as a Non-qualified
Stock Option for all purposes under the provisions of the Plan. The grant of
each Option under the Plan shall be evidenced by one or more Option Documents
in such form as the Committee shall from time to time approve, which Option
Documents shall be executed by the Company as promptly as possible following
such grant. Each Option Document shall comply with and be subject to the
following terms and conditions and such other terms and conditions as the
Committee shall from time to time require which are not inconsistent with the
terms of the Plan, and the Option Document shall expressly state the provisions
of the Plan or incorporate them by reference.
(a) Number of Option Shares. Each Option Document shall state the number of
Shares to which it pertains.
(b) Option Price. Each Option Document shall, subject to adjustment as
provided in Section 10 of the Plan, state the Option Price which, for a Non-
qualified Stock Option, may be less than, equal to, or greater than the Fair
Market Value of the Shares on the date the Option is granted and, for an ISO,
shall be at least 100% of the Fair Market Value of the Shares on the date the
Option is granted as determined by the Committee in accordance with this
Section 8(b); provided, however, that if an ISO is granted to an Optionee who
then owns, directly or by attribution under Section 424(d) of the Code, stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company or an Affiliate, then the Option Price shall be
at least 110% of the Fair Market Value of the Shares on the date the Option is
granted. If the Common Stock is traded in a public market, the Fair Market
Value per share shall be, if the Common Stock is listed on a national
securities exchange or included in the Nasdaq National Market, the last
reported sale price thereof on the relevant date, or, if the Common Stock is
not so listed or included, the mean between the last reported "bid" and "asked"
prices thereof on the relevant date, as reported on Nasdaq or, if not so
reported, as reported by the National Daily Quotation Bureau, Inc. or as
reported in a customary financial reporting service, as applicable and as the
Committee determines. If the Common Stock is not traded in a public market on
the relevant date, the Fair Market Value shall be as determined in good faith
by the Committee.
(c) Exercise. An Option granted under the Plan may be exercised in whole or
in part to the extent then exercisable under the terms of the Option Document
and this Plan, provided that no Option shall be deemed to have been exercised
prior to the receipt by the Company of written notice of such exercise (on such
form or forms as the Committee may prescribe for this purpose) and of payment
in full (except as otherwise provided in Section 8(d) of the Plan) of the
Option Price for the Shares to be purchased. Moreover, except as an Option
Document may otherwise provide, no Option may be exercised within six months of
the date of grant. Each such notice of exercise shall specify the number of
Shares to be purchased and shall (unless the Shares are covered by a then
current and effective registration statement or qualified Offering Statement
under Regulation A under the Securities Act) contain the Optionee's
acknowledgment in form and substance satisfactory to the Company that (i) such
Shares are being purchased for investment and not for distribution or resale
(other than a distribution or resale which, in the opinion of counsel
satisfactory to the Company, may be made without
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violating the registration provisions of the Act), (ii) the Optionee has been
advised and understands that (A) the Shares have not been registered under the
Act, are "restricted securities" within the meaning of Rule 144 under the Act
and are subject to restrictions on transfer and (B) the Company is under no
obligation to register the Shares under the Act or to take any action which
would make available to the Optionee any exemption from such registration,
(iii) such Shares may not be transferred without compliance with all applicable
federal and state securities laws, and (iv) an appropriate legend referring to
the foregoing restrictions on transfer and any other restrictions imposed under
the Option Documents may be endorsed on the certificates. Notwithstanding the
foregoing, if the Company in its sole discretion determines that issuance of
Shares should be delayed pending (I) registration under federal or state
securities laws, (II) the receipt of an opinion of counsel satisfactory to the
Company that an appropriate exemption from such registration is available,
(III) the listing, registration, qualification or inclusion of the Shares on
any securities exchange or an automated quotation system or under any state or
federal law or (IV) the consent or approval of any governmental regulatory body
whose consent or approval is necessary or desirable in connection with the
issuance of such Shares, the Company may defer exercise of any Option granted
hereunder until any of the events described in this sentence has occurred.
(d) Medium of Payment. Upon exercise of an Option, the aggregate Option
Price for the Shares as to which the Option is being exercised shall, in the
discretion of the Committee, be (i) paid in U.S. funds by cash (including a
check, draft or wire transfer made payable to the order of the Company), or
delivery of stock certificates for Shares of the Company's Common Stock, free
of all liens, claims and encumbrances of every kind, and endorsed in blank or
accompanied by executed stock powers with signatures guaranteed by a national
bank or trust company or a member of a national securities exchange evidencing
Shares which have been held for more than six months (in which case the value
of such Shares shall be deemed to be their Fair Market Value on the date of
exercise of the Option), (ii) paid on a deferred basis upon such terms and
conditions as the Committee in its discretion shall provide, (iii) deemed to be
paid provided the notice of exercise of the Option is accompanied to the
Committee's satisfaction by a copy of irrevocable instructions to a broker to
promptly deliver to the Company an amount of sales or loan proceeds sufficient
to pay the Option Price in full, or (iv) a combination of the foregoing. If any
part of the Option Price is to be paid on a deferred basis, the Shares with
respect to which payment is deferred shall be registered in the name of the
Optionee, but the certificate representing such Shares shall serve as security
to the Company for the payment of the Option Price and shall not be delivered
to the Optionee until the Option Price for said Shares has been paid in full.
(e) Termination of Options.
(i) No Option or any unexercised installment thereof shall be
exercisable after the first to occur of the following:
(A) Expiration of the Option term specified in the Option Document
which, subject to earlier termination as hereinafter provided, shall
not exceed (1) ten years from the date of grant, or (2) five years from
the date of grant of an ISO if the Optionee on the date of grant owns,
directly and/or by attribution under Section 424(d) of the Code, stock
possessing more than ten percent of the total combined voting power of
all classes of stock of the Company or of an Affiliate;
(B) Expiration of three months from the date the Optionee's
employment or service with the Company or its Affiliates terminates for
any reason other than Disability or death or as otherwise specified in
Subsection 8(e)(i)(D) or 8(e)(i)(E) below; provided, however, that such
Option was exercisable on the date of termination of employment or
service under the provisions of the Option Document or the Committee
specifically waives the restrictions relating to exercisability, if
any, contained in the Option Document.
(C) Expiration of one year from the date such employment or service
with the Company or its Affiliates terminates due to the Optionee's
Disability or death, whether or not the Option was exercisable on the
date of such termination under the provisions of the Option Document
relating thereto. The determination of whether the termination of the
Optionee's employment or service with
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the Company is due to Disability shall be made by the Committee, and
such determination shall be final and binding on the Company and the
Optionee;
(D) A finding by the Committee, after full consideration of the
facts presented on behalf of both the Company and the Optionee, that
the Optionee has breached his employment or service contract with the
Company or an Affiliate, or has been engaged in disloyalty to the
Company or an Affiliate, including, without limitation, fraud,
embezzlement, theft, commission of a felony or proven dishonesty in the
course of his or her employment or service, or has committed an
intentional or grossly negligent act detrimental to the interests of
the Company or an Affiliate. In such event, in addition to immediate
termination of the Option, the Optionee shall automatically forfeit all
Shares for which the Company has not yet delivered the share
certificates upon refund by the Company of the Option Price of such
Shares. Notwithstanding anything herein to the contrary, the Company
may withhold delivery of share certificates pending the resolution of
any inquiry that could lead to a finding resulting in a forfeiture; or
(E) The date, if any, set by the Board of Directors as an
accelerated expiration date in the event of a Change of Control.
(ii) Notwithstanding the Option termination provisions of Section
8(e)(i), the Committee, in it sole discretion, may extend the period during
which all or any portion of an Option may be exercised to a date no later
than the Option term specified in the Option Document pursuant to Section
8(e)(i)(A), provided that any change pursuant to this Section 8(e)(ii)
which would cause an ISO to become a Non-qualified Stock Option may be made
only with the consent of the Optionee.
(f) Transfers. Except as otherwise provided by law, no Option granted under
the Plan may be transferred, except by will or by the laws of descent and
distribution. During the lifetime of the person to whom an Option is granted,
such Option may be exercised only by him or his guardian or legal
representative. Notwithstanding the foregoing, the Committee in its sole
discretion may permit the transfer of an Option, without payment of
consideration, to immediate family members of the Optionee or to trusts or
partnerships for such family members.
(g) Limitation on ISO Grants. In no event shall the aggregate fair market
value of the Shares of Common Stock (determined at the time an ISO is granted)
with respect to which incentive stock options under all incentive stock option
plans of the Company or its Affiliates are exercisable for the first time by
the Optionee during any calendar year exceed $100,000 or such greater sum as
may here after be permitted under Section 422 of the Code.
(h) Conversion of ISO to Non-Qualified Stock Option. An Optionee shall have
the right, at the Optionee's election and upon notice to the Company, to
convert or to otherwise cause the conversion of ISO's granted to the Optionee
hereunder into Non-qualified Stock Options; provided, that Optionee shall
indemnify and hold harmless the Company from and against any loss or damage
resulting from such conversion, including, but not limited to, any loss
incurred by reason of the nonavailability of any deduction to the Company under
federal income tax law.
(i) Other Provisions. Subject to the provisions of the Plan, each Option
Document shall contain such other provisions including, without limitation,
provisions authorizing the Committee to accelerate the exercisability of all or
any portion of an Option granted pursuant to the Plan, additional restrictions
upon the exercise of the Option or additional limitations upon the term of the
Option, as the Committee shall deem advisable.
(j) Amendment. The Committee shall have the right to amend any Option
Document issued to an Optionee to the extent the terms to be amended are within
the Committee's discretion as provided in the Plan but subject to the
Optionee's consent if such amendment is not favorable to the Optionee, except
that the consent of the Optionee shall not be required for any amendment made
pursuant to Section 8(e)(i)(E) or Section 9 of the Plan, as applicable.
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9. Change of Control. In the event of a Change of Control, all Options then
outstanding under the Plan immediately shall become vested and exercisable in
full; provided that any acceleration of exercisability of options under this
Section 9 which would cause an ISO to become a Non-Qualified Stock Option may
be made only with the consent of the Optionee. In addition, in the event of a
Change of Control, the Committee may take whatever other action with respect to
Options outstanding as it deems necessary or desirable, including without
limitation, accelerating the expiration date of any Options. Any amendment to
this Section 9 which diminishes the rights of Optionees shall not be effective
with respect to Options outstanding at the time of adoption of such amendment,
whether or not such outstanding Options are then exercisable.
A "Change of Control" shall be deemed to have occurred upon the earliest to
occur of the following events: (a) the date the shareholders of the Company (or
the Board of Directors, if shareholder action is not required) approve a plan
or other arrangement pursuant to which the Company will be dissolved or
liquidated, (b) the date the shareholders of the Company (or the Board of
Directors, if shareholder action is not required) approve a definitive
agreement to sell or otherwise dispose of substantially all of the assets of
the Company, (c) the date the shareholders of the Company (or the Board of
Directors, if shareholder action is not required) and the shareholders of the
other constituent corporation (or its board of directors if shareholder action
is not required) have approved a definitive agreement to merge or consolidate
the Company with or into such other corporation other than, in either case, a
merger or consolidation of the Company in which holders of Shares of Common
Stock immediately prior to the merger or consolidation will have at least a
majority of the voting power of the surviving corporation's voting securities
immediately after the merger or consolidation, which voting securities are to
be held in the same proportion as such holders' ownership of Common Stock
immediately before the merger or consolidation, (d) the date any entity, person
or group, within the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act (other than (i) the Company or any of its Affiliates or any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any of its Affiliates, or (ii) any other person who, as of January 1, 1995,
shall have been the beneficial owner (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than 30% of outstanding shares of
Common Stock), shall have become the beneficial owner of, or shall have
obtained voting control over, more than 30% of the outstanding shares of Common
Stock, or (e) the first day after the date this Plan is effective when
directors are elected such that a majority of the Board of Directors shall have
been members of the Board of Directors for less than two years, unless the
nomination for election of each new director who was not a director at the
beginning of such two-year period was approved by a vote of at least two-thirds
of the directors then still in office who were directors at the beginning of
such period.
10. Adjustments. In the event that a dividend shall be declared upon the
Common Stock payable in Shares of Common Stock or if a stock split is declared
with respect to the Common Stock, the number of Shares of Common Stock then
subject to any Option outstanding under the Plan and the number of Shares
reserved for the grant of Options pursuant to the Plan but not yet subject to
an Option shall be adjusted by adding to each such Share the number of shares
which would be distributable in respect thereof if such Shares had been
outstanding on the date fixed for determining the shareholders of the Company
entitled to receive such stock dividend or stock split. In the event that the
outstanding shares of Common Stock shall be changed into or exchanged for a
different number or kind of shares of stock or other securities of the Company
or of another corporation, whether through reorganization, recapitalization,
stock split combination of shares, merger, consolidation or otherwise, there
shall be substituted for each Share of Common Stock subject to any such Option
and for each Share of Common Stock reserved for the grant of Options pursuant
to the Plan but not yet subject to an Option, the number and kind of shares of
stock or other securities into which each outstanding share of Common Stock
shall have been so changed or for which each such share shall have been
exchanged. In the event there shall be any change, other than as specified
above in this Section 10, in the number or kind of outstanding shares of Common
Stock or of any stock or other securities into which such Common Stock shall
have been changed or for which it shall have been exchanged, then if the Board
of Directors shall in its sole discretion determine that such change equitably
requires an adjustment in the number or kind of Shares theretofore reserved for
the grant of Options pursuant to the Plan but not yet subject to an Option and
of the Shares then subject to Options, such adjustment shall be made by the
Board of Directors and shall be effective
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and binding for all purposes of the Plan and of each Option outstanding
thereunder. In the case of any such substitution or adjustment as provided for
in this Section 10, the Option Price for each Share of stock or other security
which shall have been substituted for each Share of Common Stock covered by an
outstanding Option shall be adjusted appropriately to reflect such substitution
or adjustment. No adjustment or substitution provided for in this Section 10
shall require the Company to sell a fractional share of Common Stock, and the
total substitution or adjustment with respect to each outstanding Option shall
be limited accordingly. Upon any adjustment made pursuant to this Section 10,
the Company will, upon request, deliver to the Optionee a certificate of its
Secretary setting forth the Option Price thereafter in effect and the number
and kind of shares or other securities thereafter purchasable on the exercise
of such Option.
11. Amendment or Termination of the Plan. The Board of Directors may
terminate the Plan in whole or in part at any time or amend the Plan from time
to time in such manner as it may deem advisable. Nevertheless, the Board of
Directors of the Company shall not (a) change the class of individuals eligible
to receive an ISO, (b) increase the maximum number of Shares as to which
Options may be granted or (c) make any other change or amendment to which
shareholder approval is required in order to satisfy the conditions set forth
in Rule 16b-3 promulgated under the Exchange Act, in each case without
obtaining approval, within twelve months before or after such action, by vote
of a majority of the votes cast at a duly called meeting of the shareholders at
which a quorum representing a majority of all outstanding voting stock of the
Company is, either in person or by proxy, present and voting on the matter. No
amendment to the Plan, however, shall adversely affect any outstanding Option
in any material respect without the consent of the Optionee.
12. No Commitment to Retain. The grant of an Option pursuant to the Plan
shall not be construed to imply or to constitute evidence of any agreement,
express or implied, on the part of the Company or any Affiliate to retain the
Optionee in the employ or service of the Company or an Affiliate and/or as a
member of the Company's Board of Directors or in any other capacity, and
nothing in the Plan shall interfere with or limit in any way the right of the
Company or an Affiliate to terminate the employment or service of an Optionee.
13. Withholding of Taxes. The Company shall deduct or withhold an amount
sufficient to satisfy all Federal, state and local taxes required by law to be
withheld with respect to any grant or exercise of an Option or other
transaction under the Plan which gives rise to a withholding obligation and, in
so doing, the Company shall by agreement with the Optionee or unilaterally take
such action as it deems necessary or prudent to protect the Company's interest
with respect to such withholding obligations. In the sole discretion of the
Committee, and subject to such conditions or limitations as the Committee shall
prescribe, an Optionee may satisfy the withholding obligation, in whole or in
part, by electing to have the number of Shares to be issued upon exercise of an
Option reduced by a number of Shares having a Fair Market Value equal to the
desired withholding amount or by surrendering to the Company Shares which the
Optionee has held for more than six months having an equivalent Fair Market
Value. If the method of payment for the Shares is from a loan or sale by a
broker of the Shares acquired on exercise of the Option, the withholding
obligation shall be satisfied from the proceeds of such loan or sale.
14. Interpretation. It is the intent of the Company that transactions under
the Plan with respect to directors and officers (within the meaning of Section
16(a) of the Exchange Act) satisfy the conditions of Rule 16b-3 promulgated
under the Exchange Act. To the extent that any provision of the Plan or action
by the Committee would result in a conflict with or fail to comply with any
such condition, such provision or action shall be deemed null and void as
applied to such transactions to the extent permitted by applicable law and
deemed advisable by the Company. This Section 14 shall not be applicable if no
class of the Company's equity securities is then registered pursuant to Section
12 of the Exchange Act. In addition, with respect to employees subject to
Section 162(m) of the Code, transactions under the Plan are intended to avoid
the loss of a deduction under that Code section. Accordingly, to the extent any
provision of the Plan or action by the Committee fails to comply with Section
162(m) of the Code to avoid the loss of a deduction, it shall be deemed null
and void to the extent permitted by law and deemed advisable by the Company.
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15. Governing Law. The granting of Options and the issuance of Shares under
the Plan shall be subject to all applicable laws and regulations and to such
approvals by any governmental agency or national securities exchanges as may be
required. To the extent not pre-empted by Federal law, the Plan and all Option
Documents hereunder shall be construed in accordance with and governed by the
laws of Pennsylvania.
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