FIRST AMENDMENT TO RIGHTS AGREEMENT

     This  FIRST  AMENDMENT  TO  RIGHTS  AGREEMENT,  dated as of June 13,  2000,
between DYNAMIC MATERIALS  CORPORATION,  a Delaware corporation (the "Company"),
and HARRIS TRUST & SAVINGS  BANK,  an Illinois  banking  corporation,  as rights
agent  (the  "Rights  Agent")  (the  Company  and the  Rights  Agent are  herein
collectively referred to as the "Parties").

                                    RECITALS

     The  Company  and the  Rights  Agent are  parties  to that  certain  Rights
Agreement, dated as of January 8, 1999 (the "Rights Agreement").

     The Company and SNPE, Inc., a Delaware corporation ("SNPE"), are parties to
that certain Stock Purchase Agreement,  dated as of January 20, 2000 (the "Stock
Purchase  Agreement"),  under  which  (i) SNPE has  agreed to  purchase  and the
Company has agreed to sell  2,109,091  shares of the Company's  common stock and
(ii) the Company has agreed to issue a  promissory  note to the order of SNPE in
the amount of $1,200,000, which note is convertible into shares of the Company's
common stock.

     Pursuant to Section 7.8 of the Stock  Purchase  Agreement,  the Company has
agreed  to  amend  the  Rights   Agreement  to  provide  that  the  transactions
contemplated  by the Stock  Purchase  Agreement  and other  acquisitions  of the
Company's  common stock  contemplated  by the Stock Purchase  Agreement will not
cause the Rights (as defined in the Rights Agreement) to become exercisable.

     Pursuant to Section 27 of the Rights  Agreement,  the Company has delivered
to the Rights  Agent a  certificate  executed by an  appropriate  officer of the
Company stating that this Amendment is in compliance with the terms thereof, and
the Rights  Agent has  determined  that it will not require  the  delivery of an
opinion of counsel as set forth in the penultimate sentence of Section 27, prior
to granting its consent to this Amendment.

     Pursuant to the authority granted under Section 27 of the Rights Agreement,
the Parties agree to amend the Rights Agreement as set forth hereinbelow.

                                    AGREEMENT

     In  consideration  of the premises and covenants  herein  contained and for
good and valuable  consideration the receipt and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows:

     1. Acquiring Person. Section 1(a) of the Rights Agreement is hereby amended
as follows:

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          A. A new Section 1(a)(ii) is added as follows:

               (ii)  SNPE,  Inc.,  a  Delaware  corporation  ("SNPE")  (and  any
          successor  thereto,  but no purchaser or assignee thereof or purchaser
          or assignee of any Common  Shares of the Company  held by SNPE),  with
          regard  to  (v)  the  Common  Shares  of the  Company  owned  by  SNPE
          immediately prior to the closing of the Stock Purchase Agreement,  (w)
          2,109,091  Common Shares of the Company issued to SNPE pursuant to the
          Stock  Purchase  Agreement,  (x)  the  convertible  subordinated  note
          pursuant to the Stock  Purchase  Agreement  made by the Company to the
          order of SNPE,  dated as of June 14, 2000 (the "Note"),  which Note is
          convertible  into 200,000 Common Shares of the Company at a conversion
          price of $6.00 per share,  subject to adjustment,  (y) the issuance of
          Common Shares of the Company  pursuant to the  conversion of the Note,
          and (z) the purchase of any Common  Shares of the Company by SNPE that
          SNPE deems  necessary to maintain SNPE's  Beneficial  Ownership of the
          Common Shares in an amount not less than 50.1% of the Common Shares of
          the  Company  then   outstanding   (excluding  for  purposes  of  such
          calculation  the  number of Common  Shares of the  Company  which SNPE
          shall be entitled to receive  upon  conversion  of the Note),  (shares
          acquired by SNPE as described in subparagraphs  (v), (w), (x), (y) and
          (z) above being referred to collectively  as the "Permitted  Shares").
          Notwithstanding  the  foregoing,  SNPE shall not become an  "Acquiring
          Person"  as the  result  of an  acquisition  of  Common  Shares by the
          Company which, by reducing the number of shares outstanding, increases
          the proportionate  number of shares beneficially owned by SNPE to more
          than  50.1% of the  Common  Shares of the  Company  then  outstanding;
          provided,  however,  that if SNPE shall become the Beneficial Owner of
          50.1% or more of the Common Shares of the Company then  outstanding by
          reason of share purchases by the Company,  and shall, after such share
          purchases  by  the  Company,   become  the  Beneficial  Owner  of  any
          additional  Common Shares of the Company other than Permitted  Shares,
          then  SNPE  shall be  deemed an  "Acquiring  Person."  If the Board of
          Directors  of the  Company  determines  in good  faith  that  SNPE has
          inadvertently  acquired  Common Shares of the Company in excess of the
          Permitted  Shares and if SNPE divests  itself as promptly as practical
          of  beneficial  ownership of a sufficient  number of Common  Shares so
          that SNPE would no longer be an Acquiring Person,  then SNPE shall not
          be deemed to have become an  Acquiring  Person for any purpose in this
          Agreement.

          B.  The  subsection  currently  numbered  Section 1(a)(ii)  is  hereby
renumbered as  subsection  Section  1(a)(iii),  and all  references  thereto are
changed accordingly.

     2.  Distribution  Date.  Section  3(a) of the  Rights  Agreement  is hereby
amended as follows:

          A.  Each reference  in Section 3(a)  of the  Rights  Agreement  to "an
Exempt  Person or Heartland"  shall be deleted and replaced with the  following:
"an Exempt Person, Heartland, or SNPE."

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          B.  Section 3(a)(iii)  is hereby  deleted in  its entirety.  The comma
after  the term  "Acquisition  Date" at the end of  Section  3(a)(i)  is  hereby
deleted and replaced with the word "or," and the word "or" at the end of Section
3(a)(ii)  is  deleted  and  replaced  with  a  period  after  the  phrase  "then
outstanding."

     3.   Counterparts.   This   Amendment  may  be  executed  in  two  or  more
counterparts,  each of  which  shall  be  deemed  to be an  original,  and  such
counterparts shall together constitute one and the same instrument.

     IN WITNESS  WHEREOF,  the Parties  have  executed  this First  Amendment to
Rights Agreement as of the date first written above.

                                       DYNAMIC MATERIALS CORPORATION,
                                       a Delaware corporation


                                       By: /s/ Joseph P. Allwein
                                          --------------------------------------
                                       Name: Joseph P. Allwein
                                       Title: President


                                       HARRIS TRUST & SAVINGS BANK,
                                       an Illinois banking corporation,
                                       as Rights Agent


                                       By: /s/ Bernetta Young-Gray
                                          --------------------------------------
                                       Name: Bernetta Young-Gray
                                       Title: Trust Officer

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