exh4-1.htm


    Exhibit
4.1

    


    Execution
Copy


    


    
      	 
      	 
      


    

    


    


    


    


     

    CHICAGO
RIVET & MACHINE CO.

     

     

    and

     

    CONTINENTAL
STOCK TRANSFER & TRUST COMPANY,

     

    as
Rights Agent

     

    


    


    


    
      	 
      	 
      	 
      
	 
      	 
      	 
      


    

    


    


    


     

    Rights
Agreement

     

     

    Dated
as of November 16, 2009

     

    


    


    


    


    
      	 
      	 
      


    

     

    


    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    


    TABLE OF
CONTENTS

     

    
      	 
      	 
      	
              Page

            
	
              Section
      1.

            	
              Certain
      Definitions

            	
              1

            
	
              Section
      2.

            	
              Appointment
      of Rights Agent

            	
              7

            
	
              Section
      3.

            	
              Issuance
      of Rights Certificates

            	
              7

            
	
              Section
      4.

            	
              Form
      of Rights Certificates.

            	
              9

            
	
              Section
      5.

            	
              Countersignature
      and Registration.

            	
              10

            
	
              Section
      6.

            	
              Transfer,
      Split-Up, Combination and Exchange of Rights Certificates; Mutilated,
      Destroyed, Lost or Stolen Rights Certificates.

            	
              11

            
	
              Section
      7.

            	
              Exercise
      of Rights; Purchase Price; Expiration Date of Rights.

            	
              12

            
	
              Section
      8.

            	
              Cancellation
      and Destruction of Rights Certificates

            	
              14

            
	
              Section
      9.

            	
              Reservation
      and Availability of Capital Stock.

            	
              14

            
	
              Section
      10.

            	
              Preferred
      Stock Record Date

            	
              16

            
	
              Section
      11.

            	
              Adjustment
      of Purchase Price, Number and Kind of Shares or Number of
      Rights

            	
              16

            
	
              Section
      12.

            	
              Certificate
      of Adjusted Purchase Price or Number of Shares

            	
              24

            
	
              Section
      13.

            	
              Consolidation,
      Merger or Sale or Transfer of Assets, Cash Flow or Earning
      Power.

            	
              24

            
	
              Section
      14.

            	
              Fractional
      Rights and Fractional Shares.

            	
              26

            
	
              Section
      15.

            	
              Rights
      of Action

            	
              28

            
	
              Section
      16.

            	
              Agreement
      of Rights Holders

            	
              28

            
	
              Section
      17.

            	
              Rights
      Certificate Holder Not Deemed a Shareholder

            	
              29

            
	
              Section
      18.

            	
              Concerning
      the Rights Agent.

            	
              29

            
	
              Section
      19.

            	
              Merger
      or Consolidation or Change of Name of Rights Agent.

            	
              30

            
	
              Section
      20.

            	
              Duties
      of Rights Agent

            	
              30

            
	
              Section
      21.

            	
              Change
      of Rights Agent

            	
              32

            
	
              Section
      22.

            	
              Issuance
      of New Rights Certificates

            	
              33

            
	
              Section
      23.

            	
              Redemption
      and Termination.

            	
              33

            
	
              Section
      24.

            	
              Exchange.

            	
              34

            
	
              Section
      25.

            	
              Notice
      of Certain Events.

            	
              36

            
	
              Section
      26.

            	
              Notices

            	
              36

            
	
              Section
      27.

            	
              Supplements
      and Amendments

            	
              37

            
	
              Section
      28.

            	
              Successors

            	
              38

            
	
              Section
      29.

            	
              Determinations
      and Actions by the Board, etc.

            	
              38

            
	
              Section
      30.

            	
              Benefits
      of this Agreement

            	
              38

            
	
              Section
      31.

            	
              Severability

            	
              38

            
	
              Section
      32.

            	
              Governing
      Law

            	
              39

            
	
              Section
      33.

            	
              Counterparts

            	
              39

            
	
              Section
      34.

            	
              Descriptive
      Headings

            	
              39

            


    

    


    EXHIBITS

    Exhibit A – Statement
of Resolution Establishing Series of Shares

    Exhibit B – Form of
Rights Certificate

    Exhibit C – Form of
Summary of Rights

    


    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    


    


     

    RIGHTS
AGREEMENT

     

     

    RIGHTS AGREEMENT, dated as of
November 16, 2009 (the “Agreement”), by and
between CHICAGO RIVET & MACHINE CO., an Illinois corporation (the “Company”), and
Continental Stock Transfer & Trust Company, as rights agent (the “Rights
Agent”).

     

     

    W I T N E S S E T
H

     

     

    WHEREAS, on November 22, 1999,
the Board of Directors of the Company (the “Board”) approved and
adopted a Rights Agreement (the “1999 Agreement”)
pursuant to which preferred stock purchase rights were distributed to the
shareholders of the Company;

     

     

    WHEREAS, the rights issued
pursuant to the 1999 Agreement will expire on December 2, 2009; and

     

     

    WHEREAS, on November 16, 2009
(the “Rights Dividend
Declaration Date”), the Board determined to extend the protections
afforded to the Company by the 1999 Agreement by authorizing and declaring a
dividend distribution of one new Right (as hereinafter defined) for each share
of Common Stock (as hereinafter defined) of the Company outstanding at the close
of business on December 2, 2009 (the “Record Date”), to
replace the rights previously issued pursuant to the 1999 Agreement, and the
Board has authorized the issuance of one Right (as such number may be
hereinafter adjusted pursuant to Section 11(i) or
Section 11(p)
hereof) for each share of Common Stock of the Company issued between the Record
Date (whether originally issued or delivered from the Company’s treasury) and
the Distribution Date (as hereinafter defined) and, in certain circumstances
provided in Section
22 hereof, after the Distribution Date, each Right initially representing
the right to purchase one one-hundredth of a share of Preferred Stock (as
hereinafter defined), having the rights, powers and preferences set forth in the
form of Statement of Resolution Establishing Series of Shares attached hereto as
Exhibit A, upon
the terms and subject to the conditions hereinafter set forth (the “Rights”).

     

     

    NOW, THEREFORE, in
consideration of the premises and the mutual agreements herein set forth, the
parties hereby agree as follows:

     

     

    Section 1.  Certain
Definitions.  For purposes of this Agreement, the following
terms have the meanings indicated:

     

     

    (a)  “1999
Agreement” shall have the meaning set forth in the recitals of this
Agreement.

     

    


    
      
        
           


        

        
          
          

          
            

          

        

        
           


        

      

    

    


     

    (b)  “Acquiring Person”
shall mean any Person who or which, together with all Affiliates and Associates
of such Person, shall be the Beneficial Owner of ten percent (10%) or more of
the shares of Common Stock then outstanding, but shall not include (i) the
Company, (ii) any Subsidiary of the Company, (iii) any employee benefit plan of
the Company, or of any Subsidiary of the Company, or any Person organized,
appointed or established by the Company for or pursuant to the terms of any such
plan, (iv) any Person who becomes the Beneficial Owner of ten percent (10%) or
more of the shares of Common Stock then outstanding as a result of a reduction
in the number of shares of Common Stock outstanding due to the repurchase of
shares of Common Stock by the Company (or any Subsidiary of the Company, any
employee benefit plan of the Company or of any Subsidiary of the Company, or any
Person organized, appointed or established by the Company for or pursuant to the
terms of any such plan), unless and until such Person, after becoming aware that
such Person has become the Beneficial Owner of ten percent (10%) or more of the
then outstanding shares of Common Stock, acquires beneficial ownership of
additional shares of Common Stock representing one percent (1%) or more of the
shares of Common Stock then outstanding, or (v) any such Person who has reported
or is required to report such ownership (but less than fifteen percent (15%) on
Schedule 13G under the Exchange Act (or any comparable or successor report) or
on Schedule 13D under the Exchange Act (or any comparable or successor report)
which Schedule 13D does not state any intention to or reserve the right to
control or influence the management or policies of the Company or engage in any
of the actions specified in Item 4 of such schedule (other than the disposition
of the Common Stock) and, within ten (10) Business Days of being requested by
the Company to advise it regarding the same, certifies to the Company that such
Person acquired shares of Common Stock in excess of 9.9% inadvertently or
without knowledge of the terms of the Rights and who or which, together with all
Affiliates and Associates, thereafter does not acquire additional shares of
Common Stock while the Beneficial Owner of ten percent (10%) or more of the
shares of Common Stock then outstanding; provided, however, that if the
Person requested to so certify fails to do so within ten (10) Business Days or
breaches or violates such certification, then such Person shall become an
Acquiring Person immediately after such ten (10) Business Day period or such
breach or violation.  Notwithstanding the foregoing, the term
“Acquiring Person” shall not include (i) John A. Morrissey, Walter W. Morrissey
or any of their siblings; (ii) any spouse of any Person identified in clause (i)
above; (iii) the lineal descendants (including Persons adopted prior to
attaining the age of 21 years) of any Person described in clause (i) or (ii)
above or the spouses of any such lineal descendants; (iv) any Affiliate or
Associate of any of the Persons described in clauses (i) through (iii) above or
(v) any successor in interest (as defined below) to any Person described in
clauses (i) through (iv) above or to the parents of any person described in
clause (i) above (collectively, the “Morrissey Holders”);
provided, further, that if any
Person that is a Morrissey Holder becomes the Beneficial Owner of additional
shares of Common Stock (other than shares of Common Stock that are beneficially
owned, as of the date hereof, by any other Morrissey Holder (the “Morrissey Shares”))
such that, after giving effect to such additional shares, the number of shares
of Common Stock beneficially owned by such Person (excluding any other Morrissey
Shares) exceeds the number of shares of Common Stock beneficially owned by such
Person on the date hereof (excluding any other Morrissey Shares) by more than
two percent (2%) of the then outstanding shares of Common Stock, then such
Person shall cease to be excluded from the definition of “Acquiring Person”
pursuant to this sentence. The forgoing sentence is not intended to acknowledge
or imply that any Morrissey Holder is the Beneficial Owner of any Morrissey
Shares held by any other

     

    


    
      
        
           


        

        
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    Morrissey
Holder or that all or any portion of any Morrissey Holders constitute a “group”
(as described in Section 13(d)(3) of the Exchange Act) with respect to the
Common Stock for any purpose.  For purposes of this Section 1(a), a
Morrissey Holder’s “successor in interest” shall be (i) the beneficiaries
(whether by testate or intestate succession) of any Morrissey Holder’s estate
and any trustee (in his fiduciary capacity) or beneficiary of any trust who
obtains (by reason of the Morrissey Holder’s death) beneficial ownership of any
Morrissey Shares (ii) any Morrissey Holder’s estate, and (iii) the Affiliates
and Associates of the Persons described in clauses (i) and (ii) of this
sentence.

     

     

    (c)  “Adjustment Shares”
shall have the meaning set forth in Section 11(a)(ii)
hereof.

     

     

    (d)  “Affiliate” and “Associate” shall have
the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act.

     

     

    (e)  “Agreement” shall have
the meaning set forth in the preamble to this Agreement.

     

     

    (f)  A
Person shall be deemed the “Beneficial Owner” of,
and shall be deemed to “beneficially own,” any securities:

     

     

    (i)  which
such Person or any of such Person’s Affiliates or Associates, directly or
indirectly, owns or has the right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the satisfaction of one or
more conditions (whether or not within the control of such Person), compliance
with regulatory requirements or otherwise) pursuant to any agreement,
arrangement or understanding (whether or not in writing) or upon the exercise of
conversion rights, exchange rights, other rights, warrants or options, or
otherwise; provided, however, that a
Person shall not be deemed the “Beneficial Owner” of, or to “beneficially own,”
(A) securities tendered pursuant to a tender or exchange offer made by such
Person or any of such Person’s Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, (B) securities issuable upon
exercise of Rights at any time prior to the occurrence of a Triggering Event, or
(C) securities issuable upon exercise of Rights from and after the occurrence of
a Triggering Event which Rights were acquired by such Person or any of such
Person’s Affiliates or Associates prior to the Distribution Date or pursuant to
Section 3(a) or
Section 22
hereof (the “Original
Rights”) or pursuant to Section 11(i) or
Section 11(p)
hereof in connection with an adjustment made with respect to any Original
Rights;

     

     

    (ii)  which
such Person or any of such Person’s Affiliates or Associates, directly or
indirectly, has the right to vote or dispose of or has “beneficial ownership” of
(as determined pursuant to Rule 13d-3 of the General Rules and Regulations under
the Exchange Act), including pursuant to any agreement, arrangement or
understanding, whether or not in writing; provided, however, that a
Person shall not be deemed the “Beneficial Owner” of, or to

     

    


    
      
        
           


        

        
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    “beneficially
own,” any security under this subparagraph (ii) as a result of an agreement,
arrangement or understanding to vote such security if such agreement,
arrangement or understanding:  (A) arises solely from a revocable
proxy given in response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable provisions of the General Rules and
Regulations under the Exchange Act, and (B) is not reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or successor report);
or

     

     

    (iii)  which
are beneficially owned, directly or indirectly, by any other Person (or any
Affiliate or Associate thereof) with which such Person (or any of such Person’s
Affiliates or Associates) has any agreement, arrangement or understanding
(whether or not in writing), for the purpose of acquiring, holding, voting
(except pursuant to a revocable proxy as described in the proviso to
subparagraph (ii) of this Section 1(f)) or
disposing of any voting securities of the Company;

     

     

    provided, however, that nothing
in this Section
1(f) shall cause a Person engaged in business as an underwriter of
securities to be the “Beneficial Owner” of, or to “beneficially own,” any
securities acquired through such Person’s participation in good faith in a firm
commitment underwriting until the expiration of forty (40) days after the date
of such acquisition, and then only if such securities continue to be owned by
such Person at such expiration of forty (40) days.

     

     

    (g)  “Board” shall have the
meaning set forth in the recitals of this Agreement.

     

     

    (h)  “Business Day” shall
mean any day other than a Saturday, Sunday or a day on which NYSE Amex Equities
or banking institutions in the State of New York or Illinois are authorized or
obligated by law or executive order to close.

     

     

    (i)  “Close of business” on
any given date shall mean 5:00 P.M., New York City time, on such date; provided, however, that if such
date is not a Business Day, it shall mean 5:00 P.M., New York City time, on the
next succeeding Business Day.

     

     

    (j)  “Common Stock” shall
mean the common stock, par value $1.00 per share, of the Company or any other
shares of capital stock of the Company into which such stock shall be
reclassified or changed, except that “Common Stock” when used with reference to
any Person other than the Company shall mean the capital stock of such Person
with the greatest voting power, or the equity securities or other equity
interest having power to control or direct the management, of such
Person.

     

     

    (k)  “Common Stock
Equivalents” shall have the meaning set forth in Section 11(a)(iii)
hereof.

     

    


    
      
        
           


        

        
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    (l)  “Company” shall have
the meaning set forth in the preamble to this Agreement until a successor
corporation or entity shall have become such or until a Principal Party shall
assume, and thereafter be liable for, all obligations and duties of the Company
hereunder pursuant to the applicable provisions of this Agreement, and
thereafter, “Company” shall mean such successor or Principal Party,
respectively.

     

     

    (m)  “Current Market Price”
shall have the meaning set forth in Section 11(d)
hereof.

     

     

    (n)  “Current Value” shall
have the meaning set forth in Section 11(a)(iii)
hereof.

     

     

    (o)  “Distribution Date”
shall have the meaning set forth in Section 3(a)
hereof.

     

     

    (p)  “Equivalent Preferred
Stock” shall have the meaning set forth in Section 11(b)
hereof.

     

     

    (q)  “Exchange Act” shall
mean the Securities Exchange Act of 1934, as amended.

     

     

    (r)  “Exchange Ratio” shall
have the meaning set forth in Section 24(a)
hereof.

     

     

    (s)  “Expiration Date”
shall have the meaning set forth in Section 7(a)
hereof.

     

     

    (t)  “Final Expiration
Date” shall mean 5:00 P.M., New York City time, on December 1,
2019.

     

     

    (u)  “NASDAQ” shall have
the meaning set forth in Section 11(d)(i)
hereof.

     

     

    (v)  “Original Rights”
shall have the meaning set forth in Section 1(f)(i)
hereof.

     

     

    (w)  “Person” shall mean
any individual, firm, corporation, partnership, limited liability company,
trust, association, syndicate or other entity and includes, without limitation,
an unincorporated group of persons who, by formal or informal agreement or
arrangement (whether or not in writing), have embarked on a common purpose or
act.

     

     

    (x)  “Preferred Stock”
shall mean shares of Series A Junior Participating Preferred Stock, no par value
per share, of the Company, and, to the extent that there are not a sufficient
number of shares of Series A Junior Participating Preferred Stock authorized to
permit the full exercise of the Rights, any other series of preferred stock of
the Company designated for such

     

    


    
      
        
           


        

        
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    purpose
containing terms substantially similar to the terms of the Series A Junior
Participating Preferred Stock.

     

     

    (y)  “Principal Party”
shall have the meaning set forth in Section 13(b)
hereof.

     

     

    (z)  “Purchase Price” shall
have the meaning set forth in Section 4(a)
hereof.

     

     

    (aa)  “Qualified Offer”
shall have the meaning set forth in Section 11(a)(ii)
hereof.

     

     

    (bb)  “Record Date” shall
have the meaning set forth in the recitals of this Agreement.

     

     

    (cc)  “Redemption Price”
shall have the meaning set forth in Section 23(a)
hereof.

     

     

    (dd)  “Rights” shall have
the meaning set forth in the recitals of this Agreement.

     

     

    (ee)  “Rights Agent” shall
have the meaning set forth in the preamble of this Agreement.

     

     

    (ff)  “Rights Certificate”
shall have the meaning set forth in Section 3(a)
hereof.

     

     

    (gg)  “Rights Dividend Declaration
Date” shall have the meaning set forth in the recitals of this
Agreement.

     

     

    (hh)  “Section 11(a)(ii)
Event” shall mean any event described in Section 11(a)(ii)
hereof.

     

     

    (ii)  “Section 11(a)(ii) Trigger
Date” shall have the meaning set forth in Section 11(a)(iii)
hereof.

     

     

    (jj)  “Section 13 Event”
shall mean any event described in clauses (x), (y) or (z) of Section 13(a)
hereof.

     

     

    (kk)  “Securities Act” shall
mean the Securities Act of 1933, as amended.

     

     

    (ll)  “Spread” shall have
the meaning set forth in Section 11(a)(iii)
hereof.

     

    


    
      
        
           


        

        
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    (mm)  “Stock Acquisition
Date” shall mean the first date of public announcement (which, for
purposes of this definition, shall include, without limitation, a report filed
or amended pursuant to Section 13(d) under the Exchange Act) by the Company or
an Acquiring Person that an Acquiring Person has become such other than pursuant
to a Qualified Offer.

     

     

    (nn)  “Subsidiary” shall
mean, with reference to any Person, any corporation or other entity of which an
amount of securities or other ownership interests having ordinary voting power
sufficient to elect at least a majority of the directors or other Persons having
similar functions of such corporation or other entity are at the time, directly
or indirectly, beneficially owned, or otherwise controlled by such
Person.

     

     

    (oo)  “Substitution Period”
shall have the meaning set forth in Section 11(a)(iii)
hereof.

     

     

    (pp)  “Summary of Rights”
shall have the meaning set forth in Section 3(b)
hereof.

     

     

    (qq)  “Trading Day” shall
have the meaning set forth in Section 11(d)(i)
hereof.

     

     

    (rr)  “Triggering Event”
shall mean any Section 11(a)(ii) Event or any Section 13 Event.

     

     

    Section 2.  Appointment of Rights
Agent.  The Company hereby appoints the Rights Agent to act as
agent for the Company and the holders of the Rights (who, in accordance with
Section 3
hereof, shall prior to the Distribution Date also be the holders of the Common
Stock) in accordance with the terms and conditions hereof, and the Rights Agent
hereby accepts such appointment.  The Company may from time to time
appoint such co-rights agents as it may deem necessary or
desirable.

     

     

    Section 3.  Issuance of Rights
Certificates.

     

     

    (a)  Until
the earlier of (i) the close of business on the tenth (10th) day
after the Stock Acquisition Date (or, if the tenth (10th) day
after the Stock Acquisition Date occurs before the Record Date, the close of
business on the Record Date), or (ii) the close of business on the tenth
(10th)
Business Day (or such later date as the Board shall determine) after the date
that a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or of any
Subsidiary of the Company, or any Person organized, appointed or established by
the Company for or pursuant to the terms of any such plan) is first published or
sent or given within the meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if upon consummation thereof, such Person
would become an Acquiring Person, in either instance other than pursuant to a
Qualified Offer (the earlier of (i) and (ii) being herein referred to as the
“Distribution
Date”), (x) the Rights

     

    


    
      
        
           


        

        
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    will
be evidenced (subject to the provisions of paragraphs (b) and (c) of this Section 3) by the
certificates for the Common Stock or, in the case of uncertificated shares, the
balances indicated in the book entry account system of the transfer agent for
the Common Stock, registered in the names of the holders of the Common Stock
(which shares of Common Stock shall be deemed also to be certificates for
Rights) and not by separate certificates, and (y) the Rights will be
transferable only in connection with the transfer of the underlying shares of
Common Stock (including a transfer to the Company).  As soon as
practicable after the Distribution Date, but subject to the following sentence,
the Rights Agent will send by such means as may be selected by the Company, to
each record holder of the Common Stock as of the close of business on the
Distribution Date, at the address of such holder shown on the records of the
Company, one or more rights certificates, in substantially the form of Exhibit B hereto (the
“Rights
Certificates”), evidencing one Right for each share of Common Stock so
held, subject to adjustment as provided herein.  To the extent that a
Triggering Event under Section 11(a)(ii)
hereof has also occurred, the Company may implement such procedures, as it deems
appropriate in its sole discretion, to minimize the possibility that Rights are
received by Persons whose Rights would be void under Section 7(e)
hereof.  In the event that an adjustment in the number of Rights per
share of Common Stock has been made pursuant to Section 11(i) or
Section 11(p)
hereof, at the time of distribution of the Rights Certificates, the Company
shall make the necessary and appropriate rounding adjustments (in accordance
with Section 14(a)
hereof) so that Rights Certificates representing only whole numbers of
Rights are distributed and cash is paid in lieu of any fractional
Rights.  As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.

     

     

    (b)  The
Company will make available, as promptly as practicable following the Record
Date, a copy of a Summary of Rights, in substantially the form attached hereto
as Exhibit C
(the “Summary of
Rights”) to any holder of Rights who may so request from time to time
prior to the Expiration Date.  With respect to shares of Common Stock
outstanding as of the Record Date, or issued subsequent to the Record Date,
unless and until the Distribution Date shall occur, the Rights will be evidenced
by the certificates for the Common Stock or, in the case of uncertificated
shares, the balances indicated in the book entry account system of the transfer
agent for the Common Stock, and the registered holders of the Common Stock shall
also be the registered holders of the associated Rights.  Until the
earlier of the Distribution Date or the Expiration Date, the transfer of any
shares of Common Stock in respect of which Rights have been issued shall also
constitute the transfer of the Rights associated with such shares of Common
Stock. Notwithstanding anything to the contrary set forth in this Agreement,
upon the effectiveness of a redemption pursuant to Section 23 hereof or
an exchange pursuant to Section 24 hereof,
the Company shall not thereafter issue any additional Rights and, for the
avoidance of doubt, no Rights shall be attached to or shall be issued with any
shares of Common Stock (including any shares of Common Stock issued pursuant to
an exchange) at any time thereafter.

     

     

    (c)  Rights
shall be issued in respect of all shares of Common Stock which are issued
(whether originally issued or delivered from the Company’s treasury) after the
Record Date but prior to the earlier of the Distribution Date or the Expiration
Date or, in certain circumstances provided in Section 22 hereof,
after the Distribution Date. Certificates representing such shares of Common
Stock shall also be deemed to be certificates for Rights, and

     

    


    
      
        
           


        

        
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    shall
bear the following legend if such certificates are issued after the Record Date
but prior to the earlier of the Distribution Date or the Expiration
Date:

     

    This
certificate also evidences and entitles the holder hereof to certain Rights as
set forth in the Rights Agreement, dated as of November 16, 2009, between
Chicago Rivet & Machine Co. (the “Company”) and the
Rights Agent thereunder (the “Rights Agent”), as
originally executed and as it may be amended or restated from time to time (the
“Rights
Agreement”), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of the
Company.  Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate certificates and will no
longer be evidenced by this certificate.  The Company will mail to the
holder of this certificate a copy of the Rights Agreement, as in effect on the
date of mailing, without charge, promptly after receipt of a written request
therefor.  Under certain circumstances set forth in the Rights
Agreement, Rights issued to, or held by, any Person who is, was or becomes an
Acquiring Person or any Affiliate or Associate thereof (as such terms are
defined in the Rights Agreement), whether currently held by or on behalf of such
Person or by any subsequent holder, may become null and void.

     

     

    With
respect to such certificates containing the foregoing legend, until the earlier
of (i) the Distribution Date or (ii) the Expiration Date, the Rights associated
with the Common Stock represented by such certificates shall be evidenced by
such certificates alone and registered holders of Common Stock shall also be the
registered holders of the associated Rights, and the transfer of any of such
certificates shall also constitute the transfer of the Rights associated with
the Common Stock represented by such certificates.  Similarly, during
such time periods, transfers of uncertificated shares reflected in the balances
indicated in the book entry account system of the transfer agent for the Common
Stock shall also be deemed to be transfers of the associated
Rights.  In the case of any such uncertificated shares of Common
Stock, the Company shall cause the transfer agent for the Common Stock to
include on each direct registration account statement with respect thereto
issued after the Record Date but prior to the earlier of the Distribution Date
or the Expiration Date, a notation to the effect that the Company will mail to
the shareholder a copy of this Agreement, as in effect on the date of mailing,
without charge, promptly after receipt of a written request therefor and that
the recipient of the statement, as a holder of shares of Common Stock, may have
certain rights thereunder. In the event that shares
of the Common Stock are not represented by certificates, references in this
Agreement to certificates shall be deemed to refer to the balances indicated in
the book entry account system of the transfer agent for the Common Stock
reflecting ownership of such shares.

     

     

    Section 4.  Form of Rights
Certificates.

     

     

    (a)  The
Rights Certificates (and the forms of election to purchase and of assignment to
be printed on the reverse thereof) shall each be substantially in the form set
forth in Exhibit
B hereto and may have such marks of identification or designation and
such legends,

     

    


    
      
        
           


        

        
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    summaries
or endorsements printed thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage.  Subject to
the provisions of Section 11 and Section 22 hereof,
the Rights Certificates, whenever distributed, shall be dated as of the Record
Date and on their face shall entitle the holders thereof to purchase such number
of one one-hundredths of a share of Preferred Stock as shall be set forth
therein at the price set forth therein (such exercise price per one
one-hundredth of a share, the “Purchase Price”), but
the amount and type of securities purchasable upon the exercise of each Right
and the Purchase Price thereof shall be subject to adjustment as provided
herein.

     

     

    (b)  Any
Rights Certificate issued pursuant to Section 3(a), Section 11(i) or
Section 22
hereof that represents Rights beneficially owned by: (i) an Acquiring Person or
any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board has determined is part of a plan,
arrangement or understanding which has as a primary purpose or effect the
avoidance of Section
7(e) hereof, and any Rights Certificate issued pursuant to Section 6 or Section 11 hereof
upon transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to the extent feasible)
the following legend:

     

    The
Rights represented by this Rights Certificate are or were beneficially owned by
a Person who was or became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person (as such terms are defined in the Rights Agreement, dated as
of November 16, 2009, between Chicago Rivet & Machine Co. and the Rights
Agent thereunder, as originally executed and as it may be amended or restated
from time to time (the “Rights
Agreement”)).  Accordingly, this Rights Certificate and the
Rights represented hereby may become null and void in the circumstances
specified in Section
7(e) of the Rights Agreement.

     

     

    Section 5.  Countersignature and
Registration.

     

     

    (a)  The
Rights Certificates shall be executed on behalf of the Company by its Chairman
of the Board, its President or any Vice President, either manually or by
facsimile signature, and shall have affixed thereto the Company’s seal or a
facsimile thereof which shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile
signature.  The Rights Certificates shall be countersigned by the
Rights Agent, either manually or by facsimile signature, and shall not be valid
for any purpose unless so

     

    


    
      
        
           


        

        
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    countersigned.  In
case any officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Rights Certificates, nevertheless, may be countersigned by the Rights Agent
and issued and delivered by the Company with the same force and effect as though
the person who signed such Rights Certificates had not ceased to be such officer
of the Company; and any Rights Certificates may be signed on behalf of the
Company by any person who, at the actual date of the execution of such Rights
Certificate, shall be a proper officer of the Company to sign such Rights
Certificate, although at the date of the execution of this Agreement any such
person was not such an officer.

     

     

    (b)  Following
the Distribution Date, the Rights Agent will keep or cause to be kept, at its
principal office or offices designated as the appropriate place for surrender of
Rights Certificates upon exercise or transfer, books for registration and
transfer of the Rights Certificates issued hereunder.  Such books
shall show the names and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by each of the Rights
Certificates and the date of each of the Rights Certificates.

     

     

    Section 6.  Transfer, Split-Up,
Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or
Stolen Rights Certificates.

     

     

    (a)  Subject
to the provisions of Section 4(b), Section 7(e) and
Section 14
hereof, at any time after the close of business on the Distribution Date, and at
or prior to the close of business on the Expiration Date, any Rights Certificate
or Rights Certificates (other than Rights Certificates representing Rights that
may have been exchanged pursuant to Section 24 hereof)
may be transferred, split up, combined or exchanged for another Rights
Certificate or Rights Certificates, entitling the registered holder to purchase
a like number of one one-hundredths of a share of Preferred Stock (or, following
a Triggering Event, Common Stock, other securities, cash or other assets, as the
case may be) as the Rights Certificate or Rights Certificates surrendered then
entitles such holder (or former holder in the case of a transfer) to
purchase.  Any registered holder desiring to transfer, split up,
combine or exchange any Rights Certificate or Rights Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Rights Certificates to be transferred, split up, combined
or exchanged at the principal office or offices of the Rights Agent designated
for such purpose.  Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to take
any action whatsoever with respect to the transfer of any such surrendered
Rights Certificate or Rights Certificates until the registered holder shall have
completed and signed the certificate contained in the form of assignment on the
reverse side of such Rights Certificate and shall have provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably
request.  Thereupon the Rights Agent shall, subject to Section 4(b), Section 7(e), Section 14 and Section 24 hereof,
countersign and deliver to the Person entitled thereto a Rights Certificate or
Rights Certificates, as the case may be, as so requested.  The Company
may require payment from any holder of a Rights Certificate of a sum sufficient
to cover any tax or

     

    


    
      
        
           


        

        
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    governmental
charge that may be imposed in connection with any transfer, split up,
combination or exchange of Rights Certificates.

     

     

    (b)  Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory
to them of the loss, theft, destruction or mutilation of a Rights Certificate,
and, in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and upon surrender to the Rights
Agent and cancellation of the Rights Certificate if mutilated, the Company will
execute and deliver a new Rights Certificate of like tenor to the Rights Agent
for countersignature and delivery to the registered owner in lieu of the Rights
Certificate so lost, stolen, destroyed or mutilated.

     

     

    Section 7.  Exercise of Rights; Purchase
Price; Expiration Date of Rights.

     

     

    (a)  Subject
to Section 7(e)
hereof, at any time after the Distribution Date the registered holder of any
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions on
exercisability set forth in Section 9(c), Section 11(a)(iii)
and Section
23(a) hereof) in whole or in part upon surrender of the Rights
Certificate, with the form of election to purchase and the certificate on the
reverse side thereof duly executed, to the Rights Agent at the principal office
or offices of the Rights Agent designated for such purpose, together with
payment of the aggregate Purchase Price with respect to the total number of one
one-hundredths of a share of Preferred Stock (or other securities, cash or other
assets, as the case may be) as to which such surrendered Rights are then
exercisable, at or prior to (i) the Final Expiration Date or, if earlier, (ii)
the time at which the Rights are redeemed or exchanged as provided in Section 23 and Section 24 hereof
(the earlier of (i) and (ii) being herein referred to as the “Expiration
Date”).

     

     

    (b)  The
Purchase Price for each one one-hundredth of a share of Preferred Stock pursuant
to the exercise of a Right initially shall be $75.00, shall be subject to
adjustment from time to time as provided in Section 11 and Section 13(a) hereof
and shall be payable in accordance with paragraph (c) below.

     

     

    (c)  Upon
receipt of a Rights Certificate representing exercisable Rights, with the form
of election to purchase and the certificate duly executed, accompanied by
payment, with respect to each Right so exercised, of the Purchase Price per one
one-hundredth of a share of Preferred Stock (or other shares, securities, cash
or other assets, as the case may be) to be purchased as set forth below and an
amount equal to any applicable transfer tax, the Rights Agent shall, subject to
Section 7(f)
and Section
20(k) hereof, thereupon promptly (i) (A) requisition from any transfer
agent of the shares of Preferred Stock (or make available, if the Rights Agent
is the transfer agent for such shares) certificates for the total number of one
one-hundredths of a share of Preferred Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, or (B) if the Company shall have elected to deposit the total number
of shares of Preferred Stock issuable upon exercise of the

     

    


    
      
        
           


        

        
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    Rights
hereunder with a depositary agent, requisition from the depositary agent
depositary receipts representing such number of one one-hundredths of a share of
Preferred Stock as are to be purchased (in which case certificates for the
shares of Preferred Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company will direct the
depositary agent to comply with such request, (ii) requisition from the Company
the amount of cash, if any, to be paid in lieu of fractional shares in
accordance with Section 14 hereof,
(iii) after receipt of such certificates or depositary receipts, cause the same
to be delivered to or, upon the order of the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such
holder, and (iv) after receipt thereof, deliver such cash, if any, to or upon
the order of the registered holder of such Rights Certificate.  The
payment of the Purchase Price (as such amount may be reduced pursuant to Section 11(a)(iii)
hereof) shall be made in cash or by certified bank check or bank draft payable
to the order of the Company.  In the event that the Company is
obligated to issue other securities (including Common Stock) of the Company, pay
cash and/or distribute other property pursuant to Section 11(a) hereof,
the Company will make all arrangements necessary so that such other securities,
cash and/or other property are available for distribution by the Rights Agent,
if and when appropriate.  The Company reserves the right to require
prior to the occurrence of a Triggering Event that, upon any exercise of Rights,
a number of Rights be exercised so that only whole shares of Preferred Stock
would be issued.

     

     

    (d)  In
case the registered holder of any Rights Certificate shall exercise less than
all the Rights evidenced thereby, a new Rights Certificate evidencing the Rights
remaining unexercised shall be issued by the Rights Agent and delivered to, or
upon the order of, the registered holder of such Rights Certificate, registered
in such name or names as may be designated by such holder, subject to the
provisions of Section
14 hereof.

     

     

    (e)  Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence
of a Section 11(a)(ii) Event, any Rights beneficially owned by (i) an Acquiring
Person or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of
an Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom the Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board has determined is part of a plan,
arrangement or understanding which has as a primary purpose or effect the
avoidance of this Section 7(e), shall
become null and void without any further action and no holder of such Rights
shall have any rights whatsoever with respect to such Rights, whether under any
provision of this Agreement or otherwise.  The Company shall use all
reasonable efforts to insure that the provisions of this Section 7(e) and
Section 4(b)
hereof are complied with, but shall have no liability to any holder of Rights
Certificates or any other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or any of its Affiliates,
Associates or their respective transferees hereunder.  For purposes of
this Section

     

    


    
      
        
           


        

        
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    7(e), a Person shall
not be deemed to be an Acquiring Person if said Person became such as a result
of a Qualified Offer.

     

     

    (f)  Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the
Company shall be obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth in this Section 7 unless such
registered holder shall have (i) completed and signed the certificate contained
in the form of election to purchase set forth on the reverse side of the Rights
Certificate surrendered for such exercise, and (ii) provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably
request.

     

     

    Section 8.  Cancellation and Destruction
of Rights Certificates.  All Rights Certificates surrendered
for the purpose of exercise, transfer, split-up, combination, redemption or
exchange shall, if surrendered to the Company or any of its agents, be delivered
to the Rights Agent for cancellation or in cancelled form, or, if surrendered to
the Rights Agent, shall be cancelled by it, and no Rights Certificates shall be
issued in lieu thereof except as expressly permitted by any of the provisions of
this Agreement.  The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel and retire,
any other Rights Certificate purchased or acquired by the Company otherwise than
upon the exercise thereof.  The Rights Agent shall deliver all
cancelled Rights Certificates to the Company, or shall, at the written request
of the Company, destroy such cancelled Rights Certificates, and in such case
shall deliver a certificate of destruction thereof to the Company.

     

     

    Section 9.  Reservation and Availability
of Capital Stock.

     

     

    (a)  The
Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued shares of Preferred Stock (and,
following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out of its authorized
and issued shares held in its treasury), the number of shares of Preferred Stock
(and, following the occurrence of a Triggering Event, Common Stock and/or other
securities) that, as provided in this Agreement including Section 11(a)(iii)
hereof, will be sufficient to permit the exercise in full of all outstanding
Rights.

     

     

    (b)  So
long as the shares of Preferred Stock (and, following the occurrence of a
Triggering Event, Common Stock and/or other securities) issuable and deliverable
upon the exercise of the Rights may be listed on any national securities
exchange, the Company shall use its best efforts to cause, from and after such
time as the Rights become exercisable (but only to the extent that it is
reasonably likely that the Rights will be exercised), all shares reserved for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.

     

    


    
      
        
           


        

        
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    (c)  The
Company shall use its best efforts to (i) file, as soon as practicable following
the earliest date after the first occurrence of a Section 11(a)(ii) Event on
which the consideration to be delivered by the Company upon exercise of the
Rights has been determined pursuant to this Agreement (including in accordance
with Section
11(a)(iii) hereof), or as soon as is required by law following the
Distribution Date, as the case may be, a registration statement under the
Securities Act, with respect to the securities purchasable upon exercise of the
Rights on an appropriate form, (ii) cause such registration statement to become
effective as soon as practicable after such filing, and (iii) cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Securities Act) until the earlier of (A) the
date as of which the Rights are no longer exercisable for such securities, and
(B) the Expiration Date.  The Company will also take such action as
may be appropriate under, or to ensure compliance with, the securities or “blue
sky” laws of the various states in connection with the exercisability of the
Rights.  The Company may temporarily suspend, for a period of time not
to exceed ninety (90) days after the date set forth in clause (i) of the first
sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective.  Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension has been rescinded.  In
addition, if the Company shall determine that a registration statement is
required following the Distribution Date, the Company may temporarily suspend
the exercisability of the Rights until such time as a registration statement has
been declared effective.  Notwithstanding any provision of this
Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite qualification in such jurisdiction shall not have
been obtained, the exercise thereof shall not be permitted under applicable law
or a registration statement shall not have been declared effective.

     

     

    (d)  The
Company covenants and agrees that it will take all such action as may be
necessary to ensure that all one one-hundredths of a share of Preferred Stock
(and, following the occurrence of a Triggering Event, Common Stock and/or other
securities) delivered upon exercise of Rights shall, at the time of delivery of
the certificates for such shares (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and
nonassessable.

     

     

    (e)  The
Company further covenants and agrees that it will pay when due and payable any
and all federal and state transfer taxes and charges which may be payable in
respect of the issuance or delivery of the Rights Certificates and of any
certificates for a number of one one-hundredths of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may be) upon the exercise
of Rights.  The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer or delivery of
Rights Certificates to a Person other than, or the issuance or delivery of a
number of one one-hundredths of a share of Preferred Stock (or Common Stock
and/or other securities, as the case may be) in respect of a name other than
that of, the registered holder of the Rights Certificates evidencing Rights
surrendered for exercise, nor shall the Company be required to issue or deliver
any certificates for a number of one one-hundredths of a share of Preferred
Stock (or Common Stock and/or other securities, as the case may be) in a name
other than that of the registered holder upon the exercise of any Rights until
such tax shall have been paid (any such tax being payable

     

    


    
      
        
           


        

        
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    by
the holder of such Rights Certificates at the time of surrender) or until it has
been established to the Company’s satisfaction that no such tax is
due.

     

     

    Section 10.  Preferred Stock Record
Date.  Each person in whose name any certificate for a number
of one one-hundredths of a share of Preferred Stock (or Common Stock and/or
other securities, as the case may be) is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of such
fractional shares of Preferred Stock (or Common Stock and/or other securities,
as the case may be) represented thereby on, and such certificate shall be dated,
the date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and all applicable transfer
taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the Preferred Stock (or
Common Stock and/or other securities, as the case may be) transfer books of the
Company are closed, such Person shall be deemed to have become the record holder
of such shares (fractional or otherwise) on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Stock (or Common
Stock and/or other securities, as the case may be) transfer books of the Company
are open.  Prior to the exercise of the Rights evidenced thereby, the
holder of a Rights Certificate shall not be entitled to any rights of a
shareholder of the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.

     

     

    Section 11.  Adjustment of Purchase
Price, Number and Kind of Shares or Number of Rights.  The
Purchase Price, the number and kind of shares covered by each Right and the
number of Rights outstanding are subject to adjustment from time to time as
provided in this Section
11.

     

     

    (a)  (i)  In
the event the Company shall at any time after the date of this Agreement (A)
declare a dividend on the Preferred Stock payable in shares of Preferred Stock,
(B) subdivide or split the outstanding shares of Preferred Stock, (C) combine or
consolidate the outstanding shares of Preferred Stock into a smaller number of
shares, through a reverse stock split or otherwise, or (D) issue any shares of
its capital stock in a reclassification of the Preferred Stock (including any
such reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a) and
Section 7(e)
hereof, the Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, split, combination,
consolidation or reclassification, and the number and kind of shares of
Preferred Stock or capital stock, as the case may be, issuable on such date,
shall be proportionately adjusted so that the holder of any Right exercised
after such time shall be entitled to receive, upon payment of the Purchase Price
then in effect, the aggregate number and kind of shares of Preferred Stock or
capital stock, as the case may be, which, if such Right had been exercised
immediately prior to such date and at a time when the Preferred Stock transfer
books of the Company were open, such holder would have owned upon such exercise
and been entitled to receive by virtue of such dividend, subdivision, split,
combination, consolidation or reclassification.  If an event occurs
which would

     

    


    
      
        
           


        

        
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    require
an adjustment under both this Section 11(a)(i) and
Section
11(a)(ii) hereof, the adjustment provided for in this Section 11(a)(i)
shall be in addition to, and shall be made prior to, any adjustment required
pursuant to Section
11(a)(ii) hereof.

     

     

    (ii)  Subject
to Section 24
hereof, in the event that any Person shall, at any time after the Rights
Dividend Declaration Date, become an Acquiring Person, unless the event causing
such Person to become an Acquiring Person is a transaction set forth in Section 13(a) hereof,
or is an acquisition of shares of Common Stock pursuant to a tender offer or an
exchange offer for all outstanding shares of Common Stock at a price and on
terms determined by at least a majority of the members of the Board who are not
officers of the Company and who are not representatives, nominees, Affiliates or
Associates of an Acquiring Person, after receiving advice from one or more
investment banking firms, to be (a) at a price which is fair to shareholders and
not inadequate (taking into account all factors which such members of the Board
deem relevant, including, without limitation, prices which could reasonably be
achieved if the Company or its assets were sold on an orderly basis designed to
realize maximum value) and (b) otherwise in the best interests of the Company
and its shareholders (such an offer being referred to as a “Qualified Offer”),
then, promptly following the occurrence of such event, proper provision shall be
made so that each holder of a Right (except as provided below and in Section 7(e) hereof)
shall thereafter have the right to receive, upon exercise thereof, at the then
current Purchase Price in accordance with the terms of this Agreement, in lieu
of a number of one one-hundredths of a share of Preferred Stock, such number of
shares of Common Stock of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the then number of one
one-hundredths of a share of Preferred Stock for which a Right was exercisable
immediately prior to the first occurrence of a Section 11(a)(ii) Event, and (y)
dividing that product (which, following such first occurrence, shall thereafter
be referred to as the “Purchase Price” for each Right and for all purposes of
this Agreement) by fifty percent (50%) of the Current Market Price (determined
pursuant to Section
11(d) hereof) per share of Common Stock on the date of such first
occurrence (such number of shares, the “Adjustment
Shares”).

     

     

    (iii)  In
the event that the number of shares of Common Stock which is authorized by the
Company’s Articles of Incorporation, as they may be amended from time to time,
but not outstanding or reserved for issuance for purposes other than upon
exercise of the Rights, is not sufficient to permit the exercise in full of the
Rights in accordance with the foregoing subparagraph (ii) of this Section 11(a), the
Company shall (A) determine the value of the Adjustment Shares issuable upon the
exercise of a Right (the “Current Value”), and
(B) with respect to each Right (subject to Section 7(e) hereof),
make adequate provision to substitute for the Adjustment Shares, upon the
exercise of a Right and payment of the applicable Purchase Price, (1) cash, (2)
a reduction in the Purchase Price, (3) Common Stock or other equity securities
of the Company (including, without limitation, shares, or units of shares, of
preferred stock, such as the Preferred Stock, which the Board has deemed to have
essentially the same value or economic rights as shares of Common Stock (such
shares or units of shares of preferred stock being referred to herein as “Common Stock
Equivalents”)), (4) debt securities of the Company, (5) other assets, or
(6) any combination of the foregoing, having an aggregate value equal to the
Current Value (less the amount of any reduction in the Purchase Price), where
such aggregate value has been determined by the Board based upon the advice of a
nationally

     

    


    
      
        
           


        

        
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    recognized
investment banking firm selected by the Board; provided, however, that if the
Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within thirty (30) days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y) the date on which the Company’s
right of redemption pursuant to Section 23(a) expires
(the later of (x) and (y) being referred to herein as the “Section 11(a)(ii) Trigger
Date”), then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of the Purchase
Price, shares of Common Stock (to the extent available) and then, if necessary,
cash, which shares and/or cash have an aggregate value equal to the
Spread.  For purposes of the preceding sentence, the term “Spread” shall mean
the excess of (i) the Current Value over (ii) the Purchase Price.  If
the Board determines in good faith that it is likely that sufficient additional
shares of Common Stock could be authorized for issuance upon exercise in full of
the Rights, the thirty (30) day period set forth above may be extended to the
extent necessary, but not more than ninety (90) days after the Section 11(a)(ii)
Trigger Date, in order that the Company may seek shareholder approval for the
authorization of such additional shares (such thirty (30) day period, as it may
be extended, is herein called the “Substitution
Period”).  To the extent that the Company determines that
action should be taken pursuant to the first and/or third sentences of this
Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e) hereof,
that such action shall apply uniformly to all outstanding Rights, and (y) may
suspend the exercisability of the Rights until the expiration of the
Substitution Period in order to seek such shareholder approval for such
authorization of additional shares and/or to decide the appropriate form of
distribution to be made pursuant to such first sentence and to determine the
value thereof.  In the event of any such suspension, the Company shall
issue a public announcement stating that the exercisability of the Rights has
been temporarily suspended, as well as a public announcement at such time as the
suspension is no longer in effect.  For purposes of this Section 11(a)(iii),
the value of each Adjustment Share shall be the Current Market Price per share
of the Common Stock on the Section 11(a)(ii) Trigger Date and the per share or
per unit value of any Common Stock Equivalent shall be deemed to equal the
Current Market Price per share of the Common Stock on such date.

     

     

    (b)  In
case the Company shall fix a record date for the issuance of rights (other than
the Rights), options or warrants to all holders of shares of Preferred Stock
entitling them to subscribe for or purchase (for a period expiring
within  forty-five (45) calendar days after such record date) shares
of Preferred Stock (or shares having the same rights, privileges and preferences
as the shares of Preferred Stock (“Equivalent Preferred
Stock”)) or securities convertible into Preferred Stock or Equivalent
Preferred Stock at a price per share of Preferred Stock or per share of
Equivalent Preferred Stock (or having a conversion price per share, if a
security convertible into Preferred Stock or Equivalent Preferred Stock) less
than the Current Market Price (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of shares of Preferred Stock outstanding
on such record date, plus the number of shares of Preferred Stock which the
aggregate offering price of the total number of shares of Preferred Stock and/or
Equivalent Preferred Stock so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such Current Market Price, and the denominator of which shall be the number
of shares of Preferred Stock outstanding on such record date, plus the number of
additional shares

     

    


    
      
        
           


        

        
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    of
Preferred Stock and/or Equivalent Preferred Stock to be offered for subscription
or purchase (or into which the convertible securities so to be offered are
initially convertible).  In case such subscription price may be paid
by delivery of consideration, part or all of which may be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board, whose determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the holders of the
Rights.  Shares of Preferred Stock owned by or held for the account of
the Company shall not be deemed outstanding for the purpose of any such
computation.  Such adjustment shall be made successively whenever such
a record date is fixed, and in the event that such rights or warrants are not so
issued, the Purchase Price shall be adjusted to be the Purchase Price which
would then be in effect if such record date had not been fixed.

     

     

    (c)  In
case the Company shall fix a record date for a distribution to all holders of
shares of Preferred Stock (including any such distribution made in connection
with a consolidation or merger in which the Company is the continuing or
surviving corporation) of cash (other than a regular quarterly cash dividend out
of the earnings or retained earnings of the Company), assets (other than a
dividend payable in Preferred Stock, but including any dividend payable in stock
other than Preferred Stock) or evidences of indebtedness, or of subscription
rights or warrants (excluding those referred to in Section 11(b)
hereof), the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the Current Market
Price (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock on such record date, less the fair market value (as
determined in good faith by the Board, whose determination shall be described in
a statement filed with the Rights Agent and shall be conclusive and binding on
the Rights Agent, the holders of the Rights and all other Persons) of the
portion of the cash, assets or evidences of indebtedness so to be distributed or
of such subscription rights or warrants applicable to a share of Preferred
Stock, and the denominator of which shall be such Current Market Price (as
determined pursuant to Section 11(d) hereof)
per share of Preferred Stock.  Such adjustments shall be made
successively whenever such a record date is fixed, and in the event that such
distribution is not so made, the Purchase Price shall be adjusted to be the
Purchase Price which would have been in effect if such record date had not been
fixed.

     

     

    (d)  (ii)           For
the purpose of any computation hereunder, other than computations made pursuant
to Section
11(a)(iii) hereof, the Current Market Price per share of Common Stock on
any date shall be deemed to be the average of the daily closing prices per share
of such Common Stock for the thirty (30) consecutive Trading Days immediately
prior to such date, and for purposes of computations made pursuant to Section 11(a)(iii)
hereof, the Current Market Price per share of Common Stock on any date shall be
deemed to be the average of the daily closing prices per share of such Common
Stock for the ten (10) consecutive Trading Days immediately following such date;
provided, however, that in the
event that the Current Market Price per share of the Common Stock is determined
during a period following the announcement by the issuer of such Common Stock of
(A) a dividend or distribution on such Common Stock payable in shares of such
Common Stock or securities convertible into shares of such Common Stock (other
than the Rights), or (B) any subdivision, combination, consolidation, reverse
stock split or reclassification of such Common Stock, and the ex-dividend date
for such dividend or distribution, or the record date for such subdivision,
combination, consolidation,

     

    


    
      
        
           


        

        
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    reverse
stock split or reclassification shall not have occurred prior to the
commencement of the requisite thirty (30) Trading Day or ten (10) Trading Day
period, as set forth above, then, and in each such case, the Current Market
Price shall be properly adjusted to take into account ex-dividend
trading.  The closing price for each Trading Day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on NYSE Amex Equities or, if the
shares of Common Stock are not listed or admitted to trading on NYSE Amex
Equities, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the shares of Common Stock are listed or admitted to trading or, if the
shares of Common Stock are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market, as reported by
the National Association of Securities Dealers Automated Quotations System
(“NASDAQ”) or
such other system then in use, or, if on any such date the shares of Common
Stock are not quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in
the Common Stock selected by the Board.  If on any such date no market
maker is making a market in the Common Stock, the fair value of such shares on
such date as determined in good faith by the Board shall be used.  The
term “Trading
Day” shall mean a day on which the principal national securities exchange
on which the shares of Common Stock are listed or admitted to trading is open
for the transaction of business or, if the shares of Common Stock are not listed
or admitted to trading on any national securities exchange, a Business
Day.  If the Common Stock is not publicly held or not so listed or
traded, the Current Market Price per share shall mean the fair value per share
as determined in good faith by the Board and after consultation with an
investment banker, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes.

     

     

    (ii)  For
the purpose of any computation hereunder, the Current Market Price per share of
Preferred Stock shall be determined in the same manner as set forth above for
the Common Stock in clause (i) of this Section 11(d) (other
than the last sentence thereof).  If the Current Market Price per
share of Preferred Stock cannot be determined in the manner provided above or if
the Preferred Stock is not publicly held or listed or traded in a manner
described in clause (i) of this Section 11(d), the
Current Market Price per share of Preferred Stock shall be conclusively deemed
to be an amount equal to 100 (as such number may be appropriately adjusted for
such events as stock splits, stock dividends and recapitalizations with respect
to the Common Stock occurring after the date of this Agreement) multiplied by
the Current Market Price per share of the Common Stock.  If neither
the Common Stock nor the Preferred Stock is publicly held or so listed or
traded, Current Market Price per share of the Preferred Stock shall mean the
fair value per share as determined in good faith by the Board and after
consultation with an investment banker, whose determination shall be described
in a statement filed with the Rights Agent and shall be conclusive for all
purposes.

     

    


    
      
        
           


        

        
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    (e)  Anything
herein to the contrary notwithstanding, no adjustment in the Purchase Price
shall be required unless such adjustment would require an increase or decrease
of at least one percent (1%) in the Purchase Price; provided, however, that any
adjustments which by reason of this Section 11(e) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment.  All calculations under this Section 11 shall be
made to the nearest cent or to the nearest ten-thousandth of a share of Common
Stock or other share or one-millionth of a share of Preferred Stock, as the case
may be.  Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be
made no later than the earlier of (i) three (3) years from the date of the
transaction which mandates such adjustment, or (ii) the Expiration
Date.

     

     

    (f)  If
as a result of an adjustment made pursuant to Section 11(a)(ii) or
Section 13(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock other than Preferred Stock, thereafter the
number of such other shares so receivable upon exercise of any Right and the
Purchase Price thereof shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Preferred Stock contained in Sections 11(a), (b), (c), (e), (g), (h), (i), (j), (k) and (m), and the
provisions of Sections
7, 9,
10, 13 and 14 hereof with
respect to the Preferred Stock shall apply on like terms to any such other
shares.

     

     

    (g)  All
Rights originally issued by the Company subsequent to any adjustment made to the
Purchase Price hereunder shall evidence the right to purchase, at the adjusted
Purchase Price, the number of one one-hundredths of a share of Preferred Stock
purchasable from time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided herein.

     

     

    (h)  Unless
the Company shall have exercised its election as provided in Section 11(i), upon
each adjustment of the Purchase Price as a result of the calculations made in
Sections 11(b)
and (c), each
Right outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase Price, that
number of one one-hundredths of a share of Preferred Stock (calculated to the
nearest one-millionth) obtained by (i) multiplying (x) the number of one
one-hundredths of a share covered by a Right immediately prior to this
adjustment, by (y) the Purchase Price in effect immediately prior to such
adjustment of the Purchase Price, and (ii) dividing the product so obtained by
the Purchase Price in effect immediately after such adjustment of the Purchase
Price.

     

     

    (i)  The
Company may elect on or after the date of any adjustment of the Purchase Price
to adjust the number of Rights, in lieu of any adjustment in the number of one
one-hundredths of a share of Preferred Stock purchasable upon the exercise of a
Right.  Each of the Rights outstanding after the adjustment in the
number of Rights shall be exercisable for the number of one one-hundredths of a
share of Preferred Stock for which a Right was exercisable immediately prior to
such adjustment.  Each Right held of record prior to such adjustment
of the number of Rights shall become that number of Rights (calculated to the
nearest one ten-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of

     

    


    
      
        
           


        

        
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    the
Purchase Price by the Purchase Price in effect immediately after adjustment of
the Purchase Price.  The Company shall make a public announcement of
its election to adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment to be
made.  This record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Rights Certificates have been
issued, shall be at least ten (10) days later than the date of the public
announcement.  If Rights Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the
Company shall, as promptly as practicable, cause to be distributed to holders of
record of Rights Certificates on such record date Rights Certificates
evidencing, subject to Section 14 hereof,
the additional Rights to which such holders shall be entitled as a result of
such adjustment, or, at the option of the Company, shall cause to be distributed
to such holders of record in substitution and replacement for the Rights
Certificates held by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment.  Rights Certificates so to be distributed shall be issued,
executed and countersigned in the manner provided for herein (and may bear, at
the option of the Company, the adjusted Purchase Price) and shall be registered
in the names of the holders of record of Rights Certificates on the record date
specified in the public announcement.

     

     

    (j)  Irrespective
of any adjustment or change in the Purchase Price or the number of one
one-hundredths of a share of Preferred Stock issuable upon the exercise of the
Rights, the Rights Certificates theretofore and thereafter issued may continue
to express the Purchase Price per one one-hundredth of a share and the number of
one one-hundredths of a share which were expressed in the initial Rights
Certificates issued hereunder.

     

     

    (k)  Before
taking any action that would cause an adjustment reducing the Purchase Price
below the then stated value, if any, of the number of one one-hundredths of a
share of Preferred Stock issuable upon exercise of the Rights, the Company shall
take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue fully paid and
nonassessable such number of one one-hundredths of a share of Preferred Stock at
such adjusted Purchase Price.

     

     

    (l)  In
any case in which this Section 11 shall
require that an adjustment in the Purchase Price be made effective as of a
record date for a specified event, the Company may elect to defer until the
occurrence of such event the issuance to the holder of any Right exercised after
such record date the number of one one-hundredths of a share of Preferred Stock
and other capital stock or securities of the Company, if any, issuable upon such
exercise over and above the number of one one-hundredths of a share of Preferred
Stock and other capital stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder’s right to receive such additional shares (fractional or
otherwise) or securities upon the occurrence of the event requiring such
adjustment.

     

    


    
      
        
           


        

        
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    (m)  Anything
in this Section
11 to the contrary notwithstanding, the Company shall be entitled to make
such reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to
the extent that in their good faith judgment the Board shall determine to be
advisable in order that any (i) consolidation or subdivision of the Preferred
Stock, (ii) issuance wholly for cash of any shares of Preferred Stock at less
than the Current Market Price, (iii) issuance wholly for cash of shares of
Preferred Stock or securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, (iv) stock dividends or (v) issuance
of rights, options or warrants referred to in this Section 11, hereafter
made by the Company to holders of its Preferred Stock shall not be taxable to
such shareholders.

     

     

    (n)  The
Company covenants and agrees that it shall not, at any time after the
Distribution Date, (i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(o)
hereof), (ii) merge with or into any other Person (other than a Subsidiary of
the Company in a transaction which complies with Section 11(o)
hereof), or (iii) sell or transfer (or permit any Subsidiary to sell or
transfer), in one transaction or a series of related transactions, assets, cash
flow or earning power aggregating more than fifty percent (50%) of the assets,
cash flow or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section 11(o)
hereof), if (x) at the time of or immediately after such consolidation, merger
or sale there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights or (y)
prior to, simultaneously with or immediately after such consolidation, merger or
sale, the shareholders of the Person who constitutes, or would constitute, the
“Principal Party” for purposes of Section 13(a) hereof
shall have received a distribution of Rights previously owned by such Person or
any of its Affiliates and Associates.

     

     

    (o)  The
Company covenants and agrees that, after the Distribution Date, it will not,
except as permitted by Section 23, Section 24 or Section 27 hereof,
take (or permit any Subsidiary to take) any action if at the time such action is
taken it is reasonably foreseeable that such action will diminish substantially
or otherwise eliminate the benefits intended to be afforded by the
Rights.

     

     

    (p)  Anything
in this Agreement to the contrary notwithstanding, in the event that the Company
shall at any time after the Rights Dividend Declaration Date and prior to the
Distribution Date (i) declare a dividend on the outstanding shares of Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding shares
of Common Stock, or (iii) combine the outstanding shares of Common Stock into a
smaller number of shares, the number of Rights associated with each share of
Common Stock then outstanding, or issued or delivered thereafter but prior to
the Distribution Date, shall be proportionately adjusted so that the number of
Rights thereafter associated with each share of Common Stock following any such
event shall equal the result obtained by multiplying the number of Rights
associated with each share of Common Stock immediately prior to such event by a
fraction the numerator which shall be the

     

    


    
      
        
           


        

        
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    total
number of shares of Common Stock outstanding immediately prior to the occurrence
of the event and the denominator of which shall be the total number of shares of
Common Stock outstanding immediately following the occurrence of such
event.

     

     

    Section 12.  Certificate of Adjusted
Purchase Price or Number of Shares. Whenever an adjustment is made as
provided in Section
11 and Section
13 hereof, the Company shall (a) promptly prepare a certificate setting
forth such adjustment and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent, and with each transfer
agent for the Preferred Stock and the Common Stock, a copy of such certificate,
and (c) if a Distribution Date has occurred, mail a brief summary thereof to
each holder of a Rights Certificate in accordance with Section 26
hereof.  The Rights Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained.

     

     

    Section 13.  Consolidation, Merger or
Sale or Transfer of Assets, Cash Flow or Earning Power.

     

     

    (a)  In
the event that, following the Stock Acquisition Date, directly or indirectly,
(x) the Company shall consolidate with, or merge with and into, any other Person
(other than a Subsidiary of the Company in a transaction which complies with
Section 11(o)
hereof), and the Company shall not be the continuing or surviving corporation of
such consolidation or merger, (y) any Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o) hereof)
shall consolidate with, or merge with or into, the Company, and the Company
shall be the continuing or surviving corporation of such consolidation or merger
and, in connection with such consolidation or merger, all or part of the
outstanding shares of Common Stock shall be changed into or exchanged for stock
or other securities of any other Person or cash or any other property, or (z)
the Company shall sell or otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer), in one transaction or a series of related
transactions, assets, cash flow or earning power aggregating fifty percent (50%)
or more of the assets, cash flow or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person or Persons (other than the Company
or any Subsidiary of the Company in one or more transactions each of which
complies with Section
11(o) hereof), then, and in each such case (except as may be contemplated
by Section
13(d) hereof), proper provision shall be made so that: (i) each holder of
a Right, except as provided in Section 7(e) hereof,
shall thereafter have the right to receive, upon the exercise thereof at the
then current Purchase Price in accordance with the terms of this Agreement, such
number of validly authorized and issued, fully paid, non-assessable and freely
tradeable shares of Common Stock of the Principal Party (as such term is
hereinafter defined), not subject to any liens, encumbrances, rights of first
refusal or other adverse claims, as shall be equal to the result obtained by (1)
multiplying the then current Purchase Price by the number of one one-hundredths
of a share of Preferred Stock for which a Right is exercisable immediately prior
to the first occurrence of a Section 13 Event (or, if a Section 11(a)(ii) Event
has occurred prior to the first occurrence of a Section 13 Event, multiplying
the number of such one one-hundredths of a share for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a)(ii)
Event by the Purchase Price in effect immediately prior to such first occurrence
of a Section 11(a)(ii) Event), and (2) dividing that product (which,
following the first

     

    


    
      
        
           


        

        
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    occurrence
of a Section 13 Event, shall be referred to as the “Purchase Price” for each
Right and for all purposes of this Agreement) by fifty percent (50%) of the
Current Market Price (determined pursuant to Section 11(d)(i)
hereof) per share of the Common Stock of such Principal Party on the date of
consummation of such Section 13 Event; (ii) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such Section 13 Event,
all the obligations and duties of the Company pursuant to this Agreement; (iii)
the term “Company” shall thereafter be deemed to refer to such Principal Party,
it being specifically intended that the provisions of Section 11 hereof
shall apply only to such Principal Party following the first occurrence of a
Section 13 Event; (iv) such Principal Party shall take such steps (including,
but not limited to, the reservation of a sufficient number of shares of its
Common Stock) in connection with the consummation of any such transaction as may
be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to its shares of Common
Stock thereafter deliverable upon the exercise of the Rights; and (v) the
provisions of Section
11(a)(ii) hereof shall be of no effect following the first occurrence of
any Section 13 Event.

     

     

    (b)  “Principal Party”
shall mean:

     

     

    (i)  in
the case of any transaction described in clause (x) or (y) of the first sentence
of Section
13(a) hereof, the Person that is the issuer of any securities into which
shares of Common Stock of the Company are converted in such merger or
consolidation, and if no securities are so issued, the Person that is the other
party to such merger or consolidation; and

     

     

    (ii)  in
the case of any transaction described in clause (z) of the first sentence of
Section 13(a)
hereof, the Person that is the party receiving the greatest portion of the
assets, cash flow or earning power transferred pursuant to such transaction or
transactions;

     

     

    provided, however, that in any
such case, (1) if the Common Stock of such Person is not at such time and has
not been continuously over the preceding twelve (12) month period registered
under Section 12 of the Exchange Act, and such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has been so
registered, “Principal Party” shall refer to such other Person; and (2) in case
such Person is a Subsidiary, directly or indirectly, of more than one Person,
the Common Stock of two or more of which are and have been so registered,
“Principal Party” shall refer to whichever of such Persons is the issuer of the
Common Stock having the greatest aggregate market value.

     

     

    (c)  The
Company shall not consummate any such consolidation, merger, sale or transfer
unless the Principal Party shall have a sufficient number of authorized shares
of its Common Stock which have not been issued or reserved for issuance to
permit the exercise in full of the Rights in accordance with this Section 13 and unless
prior thereto the Company and such Principal Party shall have executed and
delivered to the Rights Agent a supplemental agreement providing for the terms
set forth in paragraphs (a) and (b) of this Section 13 and
further

     

    


    
      
        
           


        

        
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    providing
that, as soon as practicable after the date of any consolidation, merger or sale
of assets mentioned in paragraph (a) of this Section 13, the
Principal Party will:

     

     

    (i)  prepare
and file a registration statement under the Securities Act, with respect to the
Rights and the securities purchasable upon exercise of the Rights on an
appropriate form, and will use its best efforts to cause such registration
statement to (A) become effective as soon as practicable after such filing and
(B) remain effective (with a prospectus at all times meeting the requirements of
the Securities Act) until the Expiration Date;

     

     

    (ii)  take
all such other action as may be necessary to enable the Principal Party to issue
the securities purchasable upon exercise of the Rights, including but not
limited to the registration or qualification of such securities under all
requisite securities laws of jurisdictions of the various states and the listing
of such securities on such exchanges and trading markets as may be necessary or
appropriate; and

     

     

    (iii)  deliver
to holders of the Rights historical financial statements for the Principal Party
and each of its Affiliates which comply in all respects with the requirements
for registration on Form 10 (or any successor form) under the Exchange
Act.

     

     

    The
provisions of this Section 13 shall
similarly apply to successive mergers or consolidations or sales or other
transfers.  In the event that a Section 13 Event shall occur at any
time after the occurrence of a Section 11(a)(ii) Event, the Rights which have
not theretofore been exercised shall thereafter become exercisable in the manner
described in Section
13(a).

     

     

    (d)  Notwithstanding
anything in this Agreement to the contrary, Section 13 shall not
be applicable to a transaction described in subparagraphs (x) and (y) of Section 13(a) if (i)
such transaction is consummated with a Person or Persons (or a wholly-owned
Subsidiary of any such Person or Persons) who acquired shares of Common Stock
pursuant to a Qualified Offer, (ii) the price per share of Common Stock offered
in such transaction is not less than the price per share of Common Stock paid to
all holders of shares of Common Stock whose shares were purchased pursuant to
such Qualified Offer, and (iii) the form of consideration being offered to the
remaining holders of shares of Common Stock pursuant to such transaction is the
same as the form of consideration paid pursuant to such Qualified
Offer.  Upon consummation of any such transaction contemplated by this
Section 13(d),
all Rights hereunder shall expire.

     

     

    Section 14.  Fractional Rights and
Fractional Shares.

     

     

    (a)  The
Company shall not be required to issue fractions of Rights, except prior to the
Distribution Date as provided in Section 11(p) hereof,
or to distribute Rights Certificates which evidence fractional
Rights.  In lieu of such fractional Rights, the Company shall pay to
the registered holders of the Rights Certificates with regard to which such
fractional Rights would

     

    


    
      
        
           


        

        
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    otherwise
be issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right.  For purposes of this Section 14(a), the
current market value of a whole Right shall be the closing price of the Rights
for the Trading Day immediately prior to the date on which such fractional
Rights would have been otherwise issuable.  The closing price of the
Rights for any Trading Day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on NYSE Amex Equities or, if the Rights are not listed or
admitted to trading on NYSE Amex Equities, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Rights are listed or
admitted to trading, or if the Rights are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter market,
as reported by NASDAQ or such other system then in use or, if on any such date
the Rights are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in the Rights, selected by the Board.  If on any such date no such
market maker is making a market in the Rights, the fair value of the Rights on
such date as determined in good faith by the Board shall be used.

     

     

    (b)  The
Company shall not be required to issue fractions of shares of Preferred Stock
(other than fractions which are integral multiples of one one-hundredth of a
share of Preferred Stock) upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Preferred Stock (other than
fractions which are integral multiples of one one-hundredth of a share of
Preferred Stock).  In lieu of fractional shares of Preferred Stock
that are not integral multiples of one one-hundredth of a share of Preferred
Stock, the Company may pay to the registered holders of Rights Certificates at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one one-hundredth of a share of
Preferred Stock.  For purposes of this Section 14(b), the
current market value of one one-hundredth of a share of Preferred Stock shall be
one one-hundredth of the closing price of a share of Preferred Stock (as
determined pursuant to Section 11(d)(ii)
hereof) on the Trading Day immediately prior to the date of such
exercise.

     

     

    (c)  Following
the occurrence of a Triggering Event, the Company shall not be required to issue
fractions of shares of Common Stock upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Common Stock.  In
lieu of fractional shares of Common Stock, the Company may pay to the registered
holders of Rights Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the current market
value of one (1) share of Common Stock.  For purposes of this Section 14(c), the
current market value of one share of Common Stock shall be the closing price per
share of Common Stock (as determined pursuant to Section 11(d)(i)
hereof) on the Trading Day immediately prior to the date of such
exercise.

     

    


    
      
        
           


        

        
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    (d)  The
holder of a Right by the acceptance of the Rights expressly waives such holder’s
right to receive any fractional Rights or any fractional shares upon exercise of
a Right, except as permitted by this Section
14.

     

     

    Section 15.  Rights of
Action.  All rights of action in respect of this Agreement,
excepting the rights of action given to the Rights Agent under Section 18 hereof,
are vested in the respective registered holders of the Rights Certificates (and,
prior to the Distribution Date, the registered holders of the Common Stock); and
any registered holder of any Rights Certificate (or, prior to the Distribution
Date, of the Common Stock), without the consent of the Rights Agent or of the
holder of any other Rights Certificate (or, prior to the Distribution Date, of
the Common Stock), may, in the holder’s own behalf and for the holder’s own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, the holder’s
right to exercise the Rights evidenced by such Rights Certificate in the manner
provided in such Rights Certificate and in this Agreement.  Without
limiting the foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief against actual or
threatened violations of the obligations hereunder of any Person subject to this
Agreement.

     

     

    Section 16.  Agreement of Rights
Holders.  Every holder of a Right by accepting the same
consents and agrees with the Company and the Rights Agent and with every other
holder of a Right that:

     

     

    (a)  prior
to the Distribution Date, the Rights will be transferable only in connection
with the transfer of shares of Common Stock;

     

     

    (b)  after
the Distribution Date, the Rights Certificates are transferable only on the
registry books of the Rights Agent if surrendered at the principal office or
offices of the Rights Agent designated for such purposes, duly endorsed or
accompanied by a proper instrument of transfer and with the appropriate forms
and certificates fully executed;

     

     

    (c)  subject
to Section 6(a)
and Section
7(f) hereof, the Company and the Rights Agent may deem and treat the
Person in whose name a Rights Certificate (or, prior to the Distribution Date,
the associated Common Stock certificate or, in the case of uncertificated
shares, the associated balance indicated in the book entry account system of the
transfer agent for the Common Stock) is registered as the absolute owner thereof
and of the Rights evidenced thereby (notwithstanding any notations of ownership
or writing on the Rights Certificates or the associated Common Stock certificate
or, in the case of uncertificated shares, the associated balance indicated in
the book entry account system of the transfer agent for the Common Stock, made
by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent, subject to the last
sentence of Section
7(e) hereof, shall be required to be affected by any notice to the
contrary; and

     

    


    
      
        
           


        

        
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    (d)  notwithstanding
anything in this Agreement to the contrary, neither the Company nor the Rights
Agent shall have any liability to any holder of a Right or other Person as a
result of its inability to perform any of its obligations under this Agreement
by reason of any preliminary or permanent injunction or other order, judgment,
decree or ruling (whether interlocutory or final) issued by a court of competent
jurisdiction or by a governmental, regulatory, self-regulatory or administrative
agency or commission, or any statute, rule, regulation or executive order
promulgated or enacted by any governmental authority, prohibiting or otherwise
restraining performance of such obligation; provided, however, the Company
must use its best efforts to have any such injunction,  order,
judgment, decree or ruling lifted or otherwise overturned as soon as
possible.

     

     

    Section 17.  Rights Certificate Holder
Not Deemed a Shareholder.  No holder, as such, of any Rights
Certificate shall be entitled to vote, receive dividends or be deemed for any
purpose the holder of the number of one one-hundredths of a share of Preferred
Stock or any other securities of the Company which may at any time be issuable
on the exercise or exchange of the Rights represented thereby, nor shall
anything contained herein or in any Rights Certificate be construed to confer
upon the holder of any Rights Certificate, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting shareholders (except as provided in Section 25 hereof),
or to receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised or
exchanged in accordance with the provisions hereof.

     

     

    Section 18.  Concerning the Rights
Agent.

     

     

    (a)  The
Company agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and disbursements and
other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties
hereunder.  The Company also agrees to indemnify the Rights Agent for,
and to hold it harmless against, any loss, liability, or expense, incurred
without gross negligence, bad faith or willful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in connection
with the acceptance and administration of this Agreement, including the costs
and expenses of defending against any claim of liability in the
premises.

     

     

    (b)  The
Rights Agent shall be protected and shall incur no liability for or in respect
of any action taken, suffered or omitted by it in connection with its
administration of this Agreement in reliance upon any Rights Certificate or
certificate for Common Stock or, in the case of uncertificated shares, the
associated balance indicated in the book entry account system of the transfer
agent for the Common Stock, or for other securities of the Company, instrument
of assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement, or other paper or document
believed by it, in the absence of gross

     

    


    
      
        
           


        

        
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    negligence,
bad faith or willful misconduct, to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person or
Persons.

     

     

    Section 19.  Merger or Consolidation or
Change of Name of Rights Agent.

     

     

    (a)  Any
Person into which the Rights Agent or any successor Rights Agent may be merged
or with which it may be consolidated, or any Person resulting from any merger or
consolidation to which the Rights Agent or any successor Rights Agent shall be a
party, or any Person succeeding to the corporate trust, stock transfer or other
shareholder services business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto; but only if such Person would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21
hereof.  In case at the time such successor Rights Agent shall succeed
to the agency created by this Agreement, any of the Rights Certificates shall
have been countersigned but not delivered, any such successor Rights Agent may
adopt the countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.

     

     

    (b)  In
case at any time the name of the Rights Agent shall be changed and at such time
any of the Rights Certificates shall have been countersigned but not delivered,
the Rights Agent may adopt the countersignature under its prior name and deliver
Rights Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, the Rights Agent may countersign
such Rights Certificates either in its prior name or in its changed name; and in
all such cases such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.

     

     

    Section 20.  Duties of Rights
Agent.  The Rights Agent undertakes the duties and obligations
imposed by this Agreement upon the following terms and conditions, by all of
which the Company and the holders of Rights Certificates, by their acceptance
thereof, shall be bound:

     

     

    (a)  The
Rights Agent may consult with legal counsel (who may be legal counsel for the
Company), and the opinion of such counsel shall be full and complete
authorization and protection to the Rights Agent as to any action taken or
omitted by it in good faith and in accordance with such opinion.

     

     

    (b)  Whenever
in the performance of its duties under this Agreement the Rights Agent shall
deem it necessary or desirable that any fact or matter (including, without
limitation, the identity of any Acquiring Person and the determination of
Current Market Price) be proved

     

     

    
      
        
        

      

      
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    or
established by the Company prior to taking, suffering or omitting to take any
action hereunder, such fact or matter (unless other evidence in respect thereof
be herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by the Chairman of the Board, the President,
any Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.

     

     

    (c)  The
Rights Agent shall be liable hereunder only for its and its directors’,
officers’, employees’, affiliates’, agents’, advisors’, and representatives’ own
gross negligence, bad faith or willful misconduct.

     

     

    (d)  The
Rights Agent shall not be liable for or by reason of any of the statements of
fact or recitals contained in this Agreement or in the Rights Certificates or be
required to verify the same (except as to its countersignature on such Rights
Certificates), but all such statements and recitals are and shall be deemed to
have been made by the Company only.

     

     

    (e)  The
Rights Agent shall not be under any responsibility in respect of the validity of
this Agreement or the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or execution of any
Rights Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or
condition  contained in this Agreement or in any Rights Certificate;
nor shall it be responsible for any adjustment required under the provisions of
Section 11,
Section 13 or
Section 24
hereof or responsible for the manner, method or amount of any such adjustment or
the ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced by Rights
Certificates after actual notice of any such adjustment); nor shall it by any
act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Common Stock or Preferred Stock to
be issued pursuant to this Agreement or any Rights Certificate or as to whether
any shares of Common Stock or Preferred Stock will, when so issued, be validly
authorized and issued, fully paid and nonassessable.

     

     

    (f)  The
Company agrees that it will perform, execute, acknowledge and deliver or cause
to be performed, executed, acknowledged and delivered all such further and other
acts, instruments and assurances as may reasonably be required by the Rights
Agent for the carrying out or performing by the Rights Agent of the provisions
of this Agreement.

     

     

    (g)  The
Rights Agent is hereby authorized and directed to accept instructions with
respect to the performance of its duties hereunder from the Chairman of the
Board, the President, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer or any Assistant Treasurer of the Company, and to apply
to such officers for advice or instructions in connection with its duties, and
it shall not be liable for any action taken or suffered to be taken by it in
good faith in accordance with instructions of any such officer.

     

    


    
      
        
           


        

        
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    (h)  The
Rights Agent and any member, shareholder, director, officer or employee of the
Rights Agent may buy, sell or deal in any of the Rights or other securities of
the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent under this
Agreement.  Nothing herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other Person.

     

     

    (i)  The
Rights Agent may execute and exercise any of the rights or powers hereby vested
in it or perform any duty hereunder either itself or by or through its attorneys
or agents, and the Rights Agent shall not be answerable or accountable for any
act, default, neglect or misconduct of any such attorneys or agents or for any
loss to the Company resulting from any such act, default, neglect or misconduct;
provided, however, reasonable
care was exercised in the selection and continued employment
thereof.

     

     

    (j)  No
provision of this Agreement shall require the Rights Agent to expend or risk its
own funds or otherwise incur any financial liability in the performance of any
of its duties hereunder (other than internal costs incurred by the Rights Agent
in providing services to the Company in the ordinary course of its business as
Rights Agent) or in the exercise of its rights if there shall be reasonable
grounds for believing that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it.

     

     

    (k)  If,
with respect to any Rights Certificate surrendered to the Rights Agent for
exercise or transfer, the certificate attached to the form of assignment or form
of election to purchase, as the case may be, has either not been completed or
indicates an affirmative response to clause 1 and/or 2 thereof, the Rights Agent
shall not take any further action with respect to such requested exercise or
transfer without first consulting with the Company.

     

     

    Section 21.  Change of Rights
Agent.  The Rights Agent or any successor Rights Agent may
resign and be discharged from its duties under this Agreement upon thirty (30)
days’ notice in writing mailed to the Company, and to each transfer agent of the
Common Stock and Preferred Stock, by registered or certified mail, and, if such
resignation occurs after the Distribution Date, to the registered holders of the
Rights Certificates by first-class mail.  The Company may remove the
Rights Agent or any successor Rights Agent upon thirty (30) days’ notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may
be, and to each transfer agent of the Common Stock and Preferred Stock, by
registered or certified mail, and, if such removal occurs after the Distribution
Date, to the holders of the Rights Certificates by first-class
mail.  If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent.  If the Company shall fail to make such appointment
within a period of thirty (30) days after giving notice of such removal or after
it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Rights Certificate
(who shall, with such notice, submit his Rights Certificate for inspection by
the Company), then any registered holder of any Rights Certificate may apply to
any court of competent jurisdiction for the appointment of a new Rights
Agent.  Any successor Rights Agent, whether appointed by the Company
or by

     

    


    
      
        
           


        

        
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    such
a court, shall be (a) a legal business entity organized and doing business under
the laws of the United States or any state of the United States, in good
standing, having an office in the State of New York, which is authorized under
such laws to exercise corporate trust, stock transfer or shareholder services
powers and which has at the time of its appointment as Rights Agent a combined
capital and surplus of at least $50,000,000 or (b) an affiliate of a legal
business entity described in clause (a) of this sentence.  After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder, and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose.  Not later than the effective date
of any such appointment, the Company shall file notice thereof in writing with
the predecessor Rights Agent and each transfer agent of the Common Stock and the
Preferred Stock, and, if such appointment occurs after the Distribution Date,
mail a notice thereof in writing to the registered holders of the Rights
Certificates.  Failure to give any notice provided for in this Section 21, however,
or any defect therein, shall not affect the legality or validity of the Rights,
this Agreement or the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.

     

     

    Section 22.  Issuance of New Rights
Certificates.  Notwithstanding any of the provisions of this
Agreement or of the Rights to the contrary, the Company may, at its option,
issue new Rights Certificates evidencing Rights in such form as may be approved
by the Board to reflect any adjustment or change in the Purchase Price and the
number or kind or class of shares or other securities or property purchasable
under the Rights Certificates made in accordance with the provisions of this
Agreement.  In addition, in connection with the issuance or sale of
shares of Common Stock following the Distribution Date and prior to the
redemption, exchange or expiration of the Rights, the Company (a) shall, with
respect to shares of Common Stock so issued or sold pursuant to the exercise of
stock options or under any employee plan or arrangement, granted or awarded as
of the Distribution Date, or upon the exercise, conversion or exchange of
securities hereinafter issued by the Company (except as may otherwise be
provided in the instrument(s) governing such securities), and (b) may, in any
other case, if deemed necessary or appropriate by the Board, issue Rights
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no
such Rights Certificate shall be issued if, and to the extent that, the Company
shall be advised by counsel that such issuance would create a significant risk
of material adverse tax consequences to the Company or the Person to whom such
Rights Certificate would be issued, and (ii) no such Rights Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.

     

     

    Section 23.  Redemption and
Termination.

     

     

    (a)  The
Board may, at its option, at any time prior to the earlier of (i) the close of
business on the tenth (10th) day
following the Stock Acquisition Date (or, if the Stock Acquisition Date shall
have occurred prior to the Record Date, the close of business on the tenth
(10th) day
following the Record Date), or (ii) the Final Expiration Date, redeem all but
not less

     

    


    
      
        
           


        

        
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    than
all of the then outstanding Rights at a redemption price of $0.01 per Right, as
such amount may be appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such redemption
price being hereinafter referred to as the “Redemption
Price”).  Notwithstanding anything contained in this Agreement
to the contrary, the Rights shall not be exercisable after the first occurrence
of a Section 11(a)(ii) Event until such time as the Company’s right of
redemption hereunder has expired.  The Company may, at its option, pay
the Redemption Price in cash, shares of Common Stock (based on the Current
Market Price, as defined in Section 11(d)(i)
hereof, of the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board.

     

     

    (b)  Immediately
upon the action of the Board ordering the redemption of the Rights, evidence of
which shall have been filed with the Rights Agent and without any further action
and without any notice, the right to exercise the Rights will terminate and the
only right thereafter of the holders of Rights shall be to receive the
Redemption Price for each Right so held.  Promptly after the action of
the Board ordering the redemption of the Rights, the Company shall give notice
of such redemption to the Rights Agent and the holders of the then outstanding
Rights by mailing such notice to all such holders at each holder’s last address
as it appears upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common
Stock.  Any notice which is mailed in the manner herein provided shall
be deemed given, whether or not the holder receives the notice.  Each
such notice of redemption will state the method by which the payment of the
Redemption Price will be made.

     

     

    (c)  Neither
the Company nor any of its Affiliates or Associates may redeem, acquire or
purchase for value any Rights at any time in any manner other than that
specifically set forth in this Section 23 and other
than in connection with the purchase or repurchase by any of them of Common
Stock prior to the Distribution Date.

     

     

    Section 24.  Exchange.

     

     

    (a)  The
Board may, at its option, at any time after any Person becomes an Acquiring
Person, exchange all or part of the then outstanding and exercisable Rights
(which shall not include Rights that have become void pursuant to the provisions
of Section 7(e)
hereof) for Common Stock at an exchange ratio of one share of Common Stock per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the “Exchange Ratio”).
Notwithstanding the foregoing, the Board shall not be empowered to effect such
exchange at any time after (i) any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or any such
Subsidiary, or any entity holding Common Stock for or pursuant to the terms of
any such plan), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of fifty percent (50%) or more of the Common Stock
then outstanding or (ii) the occurrence of an event specified in Section 13(a)
hereof.

     

    


    
      
        
           


        

        
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    (b)  Immediately
upon the action of the Board ordering the exchange of any Rights pursuant to
subsection (a) of this Section 24 and
without any further action and without any notice, the right to exercise such
Rights shall terminate and the only right thereafter of a holder of such Rights
shall be to receive that number of shares of Common Stock equal to the number of
such Rights held by such holder multiplied by the Exchange Ratio.  The
Company shall promptly give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of
such exchange.  The Company promptly shall mail a notice of any such
exchange to all of the holders of such Rights at their last addresses as they
appear upon the registry books of the Rights Agent.  Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice.  Each such notice of exchange will
state the method by which the exchange of the Common Stock for Rights will be
effected and, in the event of any partial exchange, the number of Rights which
will be exchanged.  Any partial exchange shall be effected pro rata
based on the number of Rights (other than Rights which have become void pursuant
to the provisions of Section 7(e) hereof)
held by each holder of Rights.

     

     

    (c)  Following
the action of the Board ordering the exchange of any Rights pursuant to
subsection (a) of this Section 24, the
Company may implement such procedures in its sole discretion as it deems
appropriate for the purpose of ensuring that the Common Stock (or such other
consideration) issuable upon an exchange pursuant to this Section 24 not be
received by holders of Rights that have become void pursuant to Section 7(e)
hereof.  In furtherance thereof, if so directed by the Company, shares
of Common Stock (or other consideration) potentially issuable to holders of
Rights upon an exchange pursuant to this Section 24, who have
not verified to the satisfaction of the Company, in its sole discretion, that
they are not Acquiring Persons, may be deposited in a trust established by the
Company pending receipt of appropriate verification.

     

     

    (d)  In
any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred Stock (or Equivalent Preferred
Stock, as such term is defined in paragraph (b) of Section 11 hereof)
for Common Stock exchangeable for Rights, at the initial rate of one
one-hundredth of a share of Preferred Stock (or Equivalent Preferred Stock) for
each share of Common Stock, as appropriately adjusted to reflect stock splits,
stock dividends and other similar transactions after the date
hereof.

     

     

    (e)  In
the event that there shall not be sufficient shares of Common Stock issued but
not outstanding or authorized but unissued to permit any exchange of Rights as
contemplated in accordance with this Section 24, the
Company shall take all such action as may be necessary to authorize additional
shares of Common Stock for issuance upon exchange of the Rights.

     

     

    (f)  The
Company shall not be required to issue fractions of shares of Common Stock or to
distribute certificates which evidence fractional shares of Common
Stock.  In lieu of such fractional shares of Common Stock, there shall
be paid to the registered holders of the Rights Certificates with regard to
which such fractional shares of Common Stock would otherwise be issuable, an
amount in cash equal to the same fraction of the current market
value

     

    


    
      
        
           


        

        
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    of
a whole share of Common Stock.  For the purposes of this subsection
(f), the current market value of a whole share of Common Stock shall be the
closing price of a share of Common Stock (as determined pursuant to the second
sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior to the date of
exchange pursuant to this Section
24.

     

     

    Section 25.  Notice of Certain
Events.

     

     

    (a)  In
case the Company shall propose, at any time after the Distribution Date, (i) to
pay any dividend payable in stock of any class to the holders of Preferred Stock
or to make any other distribution to the holders of Preferred Stock (other than
a regular quarterly cash dividend out of earnings or retained earnings of the
Company), or (ii) to offer to the holders of Preferred Stock rights or warrants
to subscribe for or to purchase any additional shares of Preferred Stock or
shares of stock of any class or any other securities, rights or options, or
(iii) to effect any reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of outstanding shares of
Preferred Stock), or (iv) to effect any consolidation or merger into or with any
other Person (other than a Subsidiary of the Company in a transaction which
complies with Section
11(o) hereof), or to effect any sale or other transfer (or to permit one
or more of its Subsidiaries to effect any sale or other transfer), in one
transaction or a series of related transactions, of more than fifty percent
(50%) of the assets, cash flow or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
complies with Section
11(o) hereof), or (v) to effect the liquidation, dissolution or winding
up of the Company, then, in each such case, the Company shall give to each
holder of a Rights Certificate, to the extent feasible and in accordance with
Section 26
hereof, a notice of such proposed action, which shall specify the record date
for the purposes of such stock dividend, distribution of rights or warrants, or
the date on which such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the date of
participation therein by the holders of the shares of Preferred Stock, if any
such date is to be fixed, and such notice shall be so given in the case of any
action covered by clause (i) or (ii) above at least twenty (20) days prior to
the record date for determining holders of the shares of Preferred Stock for
purposes of such action, and in the case of any such other action, at least
twenty (20) days prior to the date of the taking of such proposed action or the
date of participation therein by the holders of the shares of Preferred Stock,
whichever shall be the earlier.

     

     

    (b)  In
the event that any Section 11(a)(ii) Event shall occur, (i) the Company shall as
soon as practicable thereafter give to each holder of a Rights Certificate, to
the extent feasible and in accordance with Section 26 hereof, a
notice of the occurrence of such event, which shall specify the event and the
consequences of the event to holders of Rights under Section 11(a)(ii)
hereof, and (ii) all references in the preceding paragraph to Preferred Stock
shall be deemed thereafter to refer to Common Stock and/or, if appropriate,
other securities.

     

     

    Section 26.  Notices.  Notices
or demands authorized by this Agreement to be given or made by the Rights Agent
or by the holder of any Rights Certificate to or on the

     

    


    
      
        
           


        

        
          36

          
            

          

        

        
           


        

      

    

    


     

    Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing by the Company
with the Rights Agent) as follows:

     

     

    Chicago
Rivet & Machine Co.

    P.O.  Box
3061

    901
Frontenac Road

    Naperville,
Illinois  60566

    Attn:  Corporate
Secretary

     

    Subject
to the provisions of Section 21, any
notice or demand authorized by this Agreement to be given or made by the Company
or by the holder of any Rights Certificate to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing by the Rights Agent with
the Company) as follows:

     

    Continental
Stock Transfer & Trust Company

    17
Battery Place, 8th Floor

    New
York, New York 10004

    Attention:
Account Administration – Vice President

     

    Notices
or demands authorized by this Agreement to be given or made by the Company or
the Rights Agent to the holder of any Rights Certificate (or, if prior to the
Distribution Date, to the holder of shares of Common Stock) shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.

     

     

    Section 27.  Supplements and
Amendments.  Prior to the Distribution Date, the Company and
the Rights Agent shall, if the Company so directs, supplement or amend any
provision of this Agreement without the approval of any holders of shares of
Common Stock.  From and after the Distribution Date, the Company and
the Rights Agent shall, if the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights Certificates in order
to: (i) cure any ambiguity, (ii) correct or supplement any provision contained
herein which may be defective or inconsistent with any other provisions herein,
(iii) shorten or lengthen any time period hereunder or (iv) change or supplement
the provisions hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
Rights Certificates (other than an Acquiring Person or an Affiliate or Associate
of an Acquiring Person).  Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section 27, the
Rights Agent shall execute such supplement or
amendment.  Notwithstanding anything herein to the contrary, this
Agreement may not be amended (other than pursuant to clauses (i) or (ii) of the
next preceding sentence) at a time when the Rights are not
redeemable.

     

    


    
      
        
           


        

        
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    Section 28.  Successors.  All
the covenants and provisions of this Agreement by or for the benefit of the
Company or the Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.

     

     

    Section 29.  Determinations and Actions
by the Board, etc.  For all purposes of this Agreement, any
calculation of the number of shares of Common Stock or any other class of
capital stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act.  The Board shall have the exclusive power and
authority to administer this Agreement and to exercise all rights and powers
specifically granted to the Board or to the Company, or as may be necessary or
advisable in the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions of this
Agreement, and (ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend the Agreement).  All such actions,
calculations, interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing) which are done or
made by the Board in good faith, shall (x) be final, conclusive and binding on
the Company, the Rights Agent, the holders of the Rights and all other parties,
and (y) not subject the Board, or any director of the Company, to any liability
to the holders of the Rights.

     

     

    Section 30.  Benefits of this
Agreement.  Nothing in this Agreement shall be construed to
give to any Person other than the Company, the Rights Agent and the registered
holders of the Rights Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock) any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Rights Certificates (and, prior to the Distribution Date, registered holders
of the Common Stock).

     

     

    Section 31.  Severability.  If
any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated; provided, however, that
notwithstanding anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or authority to be
invalid, void or unenforceable and the Board determines in its good faith
judgment that severing the invalid language from this Agreement would adversely
affect the purpose or effect of this Agreement, the right of redemption set
forth in Section
23 hereof shall be reinstated and shall not expire until the close of
business on the tenth (10th) day
following the date of such determination by the Board.  Without
limiting the foregoing, if any provision requiring a specific group of directors
of the Company to act is held by any court of competent jurisdiction or other
authority to be invalid, void or unenforceable, such determination shall then be
made by the Board in accordance with applicable law and the Company’s Articles
of Incorporation and By-Laws.

     

    


    
      
        
           


        

        
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    Section 32.  Governing
Law.  This Agreement, each Right and each Rights Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of Illinois and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts made and to be
performed entirely within such State.

     

     

    Section 33.  Counterparts.  This
Agreement may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.

     

     

    Section 34.  Descriptive
Headings.  Descriptive headings of the several Sections of this
Agreement are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.

     

    [Signature
page follows]

    


    
      
        
           


        

        
          39

          
            

          

        

        
           


        

      

    

    


    


     

    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed all as of the day and year first above written.

     

     

    
      
        	 
      	
                CHICAGO
      RIVET & MACHINE CO.

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	
                /s/
      Michael J. Bourg

              	 
      
	 
      	 
      	
                Name:

              	
                Michael
      J. Bourg

              
	 
      	 
      	
                Title:

              	
                President,
      Chief Operating Officer

              
	 
      	 
      	 
      	
                and
      Treasurer

              


      

      


      


      
        	 
      	
                CONTINENTAL
      STOCK TRANSFER

                &
      TRUST COMPANY,

                as
      Rights Agent

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:

              	/s/ John W. Comer,
      Jr.	 
      
	 
      	 
      	
                Name:

              	John W. Comer, Jr.
	 
      	 
      	
                Title:

              	Vice
      President
	 
      	 
      	 
      	 
      


      

    

     

    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    


    


     

    EXHIBIT
A

     

    STATEMENT
OF RESOLUTION ESTABLISHING SERIES OF SHARES

     

     

    of

     

     

    SERIES
A JUNIOR PARTICIPATING PREFERRED STOCK

     

    of

     

     

    CHICAGO
RIVET & MACHINE CO.

     

     

    (Pursuant
to Section 6.10 of the

    Illinois
Business Corporation Act)

     

     

    Pursuant
to the provisions of Section 6.10 of the Illinois Business Corporation Act, the
undersigned hereby submits the following statement for the purpose of
establishing and designating a series of shares and fixing and determining the
relative rights and preferences thereof:

     

     

    1.  The
name of the corporation is Chicago Rivet & Machine Co. (the “Corporation”).

     

    2.  The
following resolution, establishing and designating a series of shares and fixing
and determining the relative rights and preferences thereof, was duly adopted by
the Board of Directors of the Corporation on November 16, 2009:

     

    RESOLVED,
that pursuant to the authority granted to and vested in the Board of Directors
of the Corporation in accordance with the provisions of its Articles of
Incorporation, a series of Preferred Stock of the Corporation be and it hereby
is created, and that the designation and amount thereof and the voting powers,
preferences and relative, participating, optional and other special rights of
the shares of such series, and the qualifications, limitations or restrictions
thereof are as follows:

     

     

    Section
1.  Designation and
Amount.  The shares of such series shall be designated as
“Series A Junior Participating Preferred Stock” and the number of shares
constituting such series shall be 20,000.

     

    


    
      
        
           


        

        
          A-1

          
            

          

        

        
           


        

      

    

    


     

    Section
2.  Dividends and
Distributions.

     

     

    (A)  Subject
to the prior and superior rights of the holders of any shares of any series of
Preferred Stock ranking prior and superior to the shares of Series A Junior
Participating Preferred Stock with respect to dividends, the holders of shares
of Series A Junior Participating Preferred Stock shall be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on the twentieth
day of March, June, September and  December  in each year
(each such date being referred to herein as a “Quarterly Dividend Payment
Date”), commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A  Junior
Participating Preferred Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (a) $1.00 or (b) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per share amount of
all cash dividends, and 100 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions other than a dividend
payable in shares of Common Stock or a subdivision of the outstanding shares of
Common Stock (by reclassification or otherwise), declared on the Common Stock,
par value $1.00 per share, of the Corporation (the “Common Stock”) since
the immediately preceding Quarterly Dividend Payment Date, or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any share
or fraction of a share of Series A Junior Participating Preferred
Stock.  In the event the Corporation shall at any time after November
16, 2009 (the “Rights
Declaration Date”) (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A Junior
Participating Preferred Stock were entitled immediately prior to such event
under clause (b) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.

     

     

    (B)  The
Corporation shall declare a dividend or distribution on the Series A Junior
Participating Preferred Stock as provided in Paragraph (A) above immediately
after it declares a dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common Stock during the
period between any Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $1.00 per share on the Series A
Junior Participating Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.

     

     

    (C)  Dividends
shall begin to accrue and be cumulative on outstanding shares of Series A Junior
Participating Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Series A Junior Participating
Preferred Stock, unless the date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment Date or is a
date

     

    


    
      
        
           


        

        
          A-2

          
            

          

        

        
           


        

      

    

    


     

    after
the record date for the determination of holders of shares of Series A Junior
Participating Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date.  Accrued but unpaid dividends shall not bear
interest.  Dividends paid on the shares of Series A Junior
Participating Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at the time
outstanding.  The Board of Directors may fix a record date for the
determination of holders of shares of Series A Junior Participating Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than thirty (30) days prior to the
date fixed for the payment thereof.

     

     

    Section
3.  Voting
Rights.  The holders of shares of Series A Junior Participating
Preferred Stock shall have the following voting rights:

     

     

    (A)  Subject
to the provision for adjustment hereinafter set forth, each share of Series A
Junior Participating Preferred Stock shall entitle the holder thereof to one (1)
vote on all matters submitted to a vote of the shareholders of the Corporation.
In the event the Corporation shall at any time after the Rights Declaration Date
(i) declare any dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the number of
votes per share to which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such event shall be adjusted
by multiplying such number by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

     

     

    (B)  Except
as otherwise provided herein or by law, the holders of shares of Series A Junior
Participating Preferred Stock and the holders of shares of Common Stock shall
vote together as one class on all matters submitted to a vote of shareholders of
the Corporation.

     

     

    (C)           (i)  If
at any time dividends on any Series A Junior Participating Preferred Stock shall
be in arrears in an amount equal to six (6) quarterly dividends thereon, the
occurrence of such contingency shall mark the beginning of a period (herein
called a “default period”) which shall extend until such time when all accrued
and unpaid dividends for all previous quarterly dividend periods and for the
current quarterly dividend period on all shares of Series A Junior Participating
Preferred Stock then outstanding shall have been declared and paid or set apart
for payment.  During each default period, all holders of Preferred
Stock (including holders of the Series A Junior Participating Preferred Stock)
with dividends in arrears in an amount equal to six (6) quarterly dividends
thereon, voting as a class, irrespective of series, shall have the right to
elect two (2) directors.

     

    


    
      
        
           


        

        
          A-3

          
            

          

        

        
           


        

      

    

    


     

    (ii)  During
any default period, such voting right of the holders of Series A Junior
Participating Preferred Stock may be exercised initially at a special meeting
called pursuant to subparagraph (iii) of this Section 3(C) or at
any annual meeting of shareholders, and thereafter at annual meetings of
shareholders, provided that neither such voting right nor the right of the
holders of any other series of Preferred Stock, if any, to increase, in certain
cases, the authorized number of directors shall be exercised unless the holders
of ten percent (10%) in number of shares of Preferred Stock outstanding shall be
present in person or by proxy.  The absence of a quorum of the holders
of Common Stock shall not affect the exercise by the holders of Preferred Stock
of such voting right.  At any meeting at which the holders of
Preferred Stock shall exercise such voting right initially during an existing
default period, they shall have the right, voting as a class, to elect directors
to fill such vacancies, if any, in the Board of Directors as may then exist up
to two (2) directors or, if such right is exercised at an annual meeting, to
elect two (2) directors.  If the number which may be so elected at any
special meeting does not amount to the required number, the holders of the
Preferred Stock shall have the right to make such increase in the number of
directors as shall be necessary to permit the election by them of the required
number.  After the holders of the Preferred Stock shall have exercised
their right to elect directors in any default period and during the continuance
of such period, the number of directors shall not be increased or decreased
except by vote of the holders of Preferred Stock as herein provided or pursuant
to the rights of any equity securities ranking senior to or pari passu with the Series A
Junior Participating Preferred Stock.

     

     

    (iii)  Unless
the holders of Preferred Stock shall, during an existing default period, have
previously exercised their right to elect directors, the Board of Directors may
order, or any shareholder or shareholders owning in the aggregate not less than
ten percent (10%) of the total number of shares of Preferred Stock outstanding,
irrespective of series, may request, the calling of a special meeting of the
holders of Preferred Stock, which meeting shall thereupon be called by the
President, a Vice President or the Secretary of the
Corporation.  Notice of such meeting and of any annual meeting at
which holders of Preferred Stock are entitled to vote pursuant to this Paragraph
(C)(iii) shall be given to each holder of record of Preferred Stock by mailing a
copy of such notice to him at his last address as the same appears on the books
of the Corporation.  Such meeting shall be called for a time not
earlier than twenty (20) days and not later than sixty (60) days after such
order or request or in default of the calling of such meeting within sixty (60)
days after such order or request, such meeting may be called on similar notice
by any shareholder or shareholders owning in the aggregate not less than ten
percent (10%) of the total number of shares of Preferred Stock
outstanding.  Notwithstanding the provisions of this Paragraph
(C)(iii), no such special meeting shall be called during the period within sixty
(60) days immediately preceding the date fixed for the next annual meeting of
the shareholders.

     

     

    (iv)  In
any default period, the holders of Common Stock, and other classes of stock of
the Corporation if applicable, shall continue to be entitled to elect the whole
number of directors until the holders of Preferred Stock shall have exercised
their right to elect two (2) directors voting as a class, after the exercise of
which right (x) the directors so elected by the holders of Preferred Stock shall
continue in office until their successors shall have been elected by such
holders or until the expiration of the default period, and (y) any vacancy in
the Board of Directors may (except as provided in Paragraph (C)(ii) of this
Section 3) be
filled by

     

    


    
      
        
           


        

        
          A-4

          
            

          

        

        
           


        

      

    

    


     

    vote
of a majority of the remaining directors theretofore elected by the holders of
the class of stock which elected the director whose office shall have become
vacant.  References in this Paragraph (C) to directors elected by the
holders of a particular class of stock shall include directors elected by such
directors to fill vacancies as provided in clause (y) of the foregoing
sentence.

     

     

    (v)  Immediately
upon the expiration of a default period, (x) the right of the holders of
Preferred Stock as a class to elect directors shall cease, (y) the term of any
directors elected by the holders of Preferred Stock as a class shall terminate,
and (z) the number of directors shall be such number as may be provided for in
the Articles of Incorporation or By-Laws of the Corporation (as the same may be
amended from time to time, respectively, the “Articles of
Incorporation” and the “By-Laws”)
irrespective of any increase made pursuant to the provisions of Paragraph
(C)(ii) of this Section 3 (such
number being subject, however, to change thereafter in any manner provided by
law or in the Articles of Incorporation or the By-Laws).  Any
vacancies in the Board of Directors effected by the provisions of clauses (y)
and (z) in the preceding sentence may be filled by a majority of the remaining
directors.

     

     

    (D)  Except
as set forth herein, holders of Series A Junior Participating Preferred Stock
shall have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as
set forth herein) for taking any corporate action.

     

     

    Section
4.  Certain
Restrictions.

     

     

    (A)  Whenever
quarterly dividends or other dividends or distributions payable on the Series A
Junior Participating Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Junior
Participating Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:

     

     

    (i)  declare
or pay dividends on, make any other distributions on, or redeem or purchase or
otherwise acquire for consideration any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to the Series A
Junior Participating Preferred Stock;

     

     

    (ii)  declare
or pay dividends on or make any other distributions on any shares of stock
ranking on a parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Junior Participating Preferred Stock, except
dividends paid ratably on the Series A Junior Participating Preferred Stock and
all such parity stock on which dividends are payable or in arrears in proportion
to the total amounts to which the holders of all such shares are then
entitled;

     

    


    
      
        
           


        

        
          A-5

          
            

          

        

        
           


        

      

    

    


     

    (iii)  redeem
or purchase or otherwise acquire for consideration shares of any stock ranking
on a parity (either as to dividends or upon liquidation, dissolution or winding
up) with the Series A Junior Participating Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire shares of any
such parity stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or winding up)
to the Series A Junior Participating Preferred Stock; or

     

     

    (iv)  purchase
or otherwise acquire for consideration any shares of Series A Junior
Participating Preferred Stock, or any shares of stock ranking on a parity with
the Series A Junior Participating Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable treatment among the
respective series or classes.

     

     

    (B)  The
Corporation shall not permit any subsidiary of the Corporation to purchase or
otherwise acquire for consideration any shares of stock of the Corporation
unless the Corporation could, under Paragraph (A) of this Section 4, purchase
or otherwise acquire such shares at such time and in such manner.

     

     

    Section
5.  Reacquired
Shares.  Any shares of Series A Junior Participating Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof.  All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and may be reissued as part of
a new series of Preferred Stock to be created by resolution or resolutions of
the Board of Directors, subject to the conditions and restrictions on issuance
set forth herein.

     

     

    Section
6.  Liquidation, Dissolution or
Winding Up.  (A)  Upon any liquidation (voluntary or
otherwise), dissolution or winding up of the Corporation, no distribution shall
be made to the holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock unless, prior thereto, the holders of shares of
Series A Junior Participating Preferred Stock shall have received an amount
equal to $100 per share of Series A Junior Participating Preferred Stock, plus
an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment (the “Series A Liquidation
Preference”).  Following the payment of the full amount of the
Series A Liquidation Preference, no additional distributions shall be made to
the holders of shares of Series A Junior Participating Preferred Stock unless,
prior thereto, the holders of shares of Common Stock shall have received an
amount per share (the “Common Adjustment”)
equal to the quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 100 (as appropriately adjusted as set forth in subparagraph
(C) below to reflect such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock) (such number in clause (ii),
the “Adjustment
Number”).  Following the payment of the full

     

    


    
      
        
           


        

        
          A-6

          
            

          

        

        
           


        

      

    

    


     

    amount
of the Series A Liquidation Preference and the Common Adjustment in respect of
all outstanding shares of Series A Junior Participating Preferred Stock and
Common Stock, respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of Common Stock shall receive their ratable and
proportionate share of the remaining assets to be distributed in the ratio of
the Adjustment Number to 1 with respect to such Preferred Stock and Common
Stock, on a per share basis, respectively.

     

     

    (B)  In
the event, however, that there are not sufficient assets available to permit
payment in full of the Series A Liquidation Preference and the liquidation
preferences of all other series of preferred stock, if any, which rank on a
parity with the Series A Junior Participating Preferred Stock, then such
remaining assets shall be distributed ratably to the holders of such parity
shares in proportion to their respective liquidation preferences.  In
the event, however, that there are not sufficient assets available to permit
payment in full of the Common Adjustment, then such remaining assets shall be
distributed ratably to the holders of Common Stock.

     

     

    (C)  In
the event the Corporation shall at any time after the Rights Declaration Date
(i) declare any dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the Adjustment
Number in effect immediately prior to such event shall be adjusted by
multiplying such Adjustment Number by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

     

     

    Section
7.  Consolidation, Merger,
etc.  In case the Corporation shall enter into any
consolidation, merger, combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case the shares of Series A Junior
Participating Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 100 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed or
exchanged.  In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount set forth in the preceding sentence with respect to
the exchange or change of shares of Series A Junior Participating Preferred
Stock shall be adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.

     

     

    Section
8.  No
Redemption.  The shares of Series A Junior Participating
Preferred Stock shall not be redeemable.

     

    


    
      
        
           


        

        
          A-7

          
            

          

        

        
           


        

      

    

    


     

    Section
9.  Ranking.  The
Series A Junior Participating Preferred Stock shall rank junior to all other
series of the Corporation’s Preferred Stock as to the payment of dividends and
the distribution of assets, unless the terms of any such series shall provide
otherwise.

     

     

    Section
10.  Amendment.  At
any time when any shares of Series A Junior Participating Preferred Stock are
outstanding, neither the Articles of Incorporation nor this Statement of
Resolution Establishing Series of Shares shall be amended in any manner which
would materially alter or change the powers, preferences or special rights of
the Series A Junior Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of a majority or more of the
outstanding shares of Series A Junior Participating Preferred Stock, voting
separately as a class.

     

     

    Section
11.  Fractional
Shares.  Series A Junior Participating Preferred Stock may be
issued in fractions of a share which shall entitle the holder, in proportion to
such holder’s fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.

     

    [Signature
page follows]

    


    
      
        
           


        

        
          A-8

          
            

          

        

        
           


        

      

    

    


     

    IN
WITNESS WHEREOF, we have executed and subscribed this Statement of Resolution
Establishing Series of Shares and do affirm the foregoing as true under
penalties of perjury this ___ day of __________, 2009.

     

    


    
      	 
      	 
      	 
      
	 
      	
              President

            	 
      


    

    


    


    
      
        
           


        

        
          A-9

          
            

          

        

        
           


        

      

    

    


    


     

    EXHIBIT
B

    


    


     

    [Form
of Rights Certificate]

     

    


    
      	
              Certificate
      No.  R-

            	
                      _______
      Rights

            


    

    


     

    NOT
EXERCISABLE AFTER DECEMBER 1, 2019 OR SUCH EARLIER DATE AS THE RIGHTS ARE
REDEEMED, EXCHANGED OR TERMINATED BY THE COMPANY.  THE RIGHTS ARE
SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT, AND TO
EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.  UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND
VOID.  [THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT).  ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) OF SUCH AGREEMENT.]1

     

    


    
      	 
      	
              Rights
      Certificate

            
	 
      	 
      
	 
      	
              CHICAGO
      RIVET & MACHINE CO.

            


    

     

    


     

    
      	 
      	 
      


    

    1  The portion of the legend in brackets
shall be inserted only if applicable and shall replace the preceding
sentence.

    


    
      
        
           


        

        
          B-1

          
            

          

        

        
           


        

      

    

    


     

    This
certifies that _________________, or registered assigns, is the registered owner
of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of November 16, 2009, as from time to time amended (the
“Rights
Agreement”), between Chicago Rivet & Machine Co., an Illinois
corporation (the “Company”), and
Continental Stock Transfer & Trust Company (the “Rights Agent”), to
purchase from the Company at any time prior to 5:00 P.M. (New York City time) on
December 1, 2019 or such time as the Rights are earlier redeemed, exchanged or
terminated, at the office or offices of the Rights Agent designated for such
purpose, or its successors as Rights Agent, one one-hundredth of a fully paid,
non-assessable share of Series A Junior Participating Preferred Stock (the
“Preferred
Stock”) of the Company, at a purchase price of $______ per one
one-hundredth of a share (the “Purchase Price”),
upon presentation and surrender of this Rights Certificate with the Form of
Election to Purchase and related Certificate duly executed.  The
number of Rights evidenced by this Rights Certificate (and the number of shares
which may be purchased upon exercise thereof) set forth above, and the Purchase
Price per share set forth above, are the number and Purchase Price as of
__________ ___, 20__, based on the Preferred Stock as constituted at such
date.  The Company reserves the right to require prior to the
occurrence of a Triggering Event (as such term is defined in the Rights
Agreement) that a number of Rights be exercised so that only whole shares of
Preferred Stock will be issued.  Capitalized terms used in this Rights
Certificate without definition shall have the meanings ascribed to them in the
Rights Agreement.

     

     

    Upon
the occurrence of a Section 11(a)(ii) Event (as such term is defined in the
Rights Agreement), if the Rights evidenced by this Rights Certificate are
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of
any such Acquiring Person (as such terms are defined in the Rights Agreement),
(ii) a transferee of any such Acquiring Person, Associate or Affiliate, or (iii)
under certain circumstances specified in the Rights Agreement, a transferee of a
person who, after such transfer, became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person, such Rights shall become null and void and no
holder hereof shall have any right with respect to such Rights from and after
the occurrence of such Section 11(a)(ii) Event.  For purposes of this
paragraph, a person shall not be deemed an Acquiring Person if such Person
became so as a result of a Qualified Offer.

     

     

    As
provided in the Rights Agreement, the Purchase Price and the number and kind of
shares of Preferred Stock or other securities, which may be purchased upon the
exercise of the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events, including
Triggering Events.

     

     

    This
Rights Certificate is subject to all of the terms, provisions and conditions of
the Rights Agreement, which terms, provisions and conditions are hereby
incorporated herein by reference and made a part hereof and to which Rights
Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights
Agreement.  Copies of the Rights Agreement are on file at

     

    


    
      
        
           


        

        
          B-2

          
            

          

        

        
           


        

      

    

    


     

    the
above-mentioned office of the Rights Agent and are also available upon written
request to the Rights Agent.

     

     

    This
Rights Certificate, with or without other Rights Certificates, upon surrender at
the principal office or offices of the Rights Agent designated for such purpose,
may be exchanged for another Rights Certificate or Rights Certificates of like
tenor and date evidencing Rights entitling the holder to purchase a like
aggregate number of one one-hundredths of a share of Preferred Stock as the
Rights evidenced by the Rights Certificate or Rights Certificates surrendered
shall have entitled such holder to purchase.  If this Rights
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Rights Certificate or Rights Certificates for the
number of whole Rights not exercised.

     

     

    Subject
to the provisions of the Rights Agreement, the Rights evidenced by this
Certificate may be redeemed by the Company at its option at a redemption price
of $0.01 per Right at any time prior to the earlier of the close of business on
(i) the tenth day following the Stock Acquisition Date, and (ii) the Final
Expiration Date.  In addition, under certain circumstances following
the Stock Acquisition Date, the Rights may be exchanged, in whole or in part,
for shares of Common Stock, or shares of preferred stock of the Company having
essentially the same value or economic rights as such
shares.  Immediately upon the action of the Board authorizing any such
exchange, and without any further action or any notice, the Rights (other than
Rights which are not subject to such exchange) will terminate and the Rights
will only enable holders to receive the shares issuable upon such
exchange.

     

     

    No
fractional shares of Preferred Stock will be issued upon the exercise of any
Right or Rights evidenced hereby (other than fractions which are integral
multiples of one one-hundredth of a share of Preferred Stock, which may, at the
election of the Company, be evidenced by depositary receipts), but in lieu
thereof a cash payment will be made, as provided in the Rights
Agreement.  The Company, at its election, may require that a number of
Rights be exercised so that only whole shares of Preferred Stock would be
issued.

     

     

    No
holder of this Rights Certificate shall be entitled to vote or receive dividends
or be deemed for any purpose the holder of shares of Preferred Stock or of any
other securities of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to give
consent to or withhold consent from any corporate action, or to receive notice
of meetings or other actions affecting shareholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Rights Certificate shall have been
exercised as provided in the Rights Agreement.

     

     

    This
Rights Certificate shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Rights Agent.

     

    
      
        
        

      

      
        B-3

        
          

        

      

      
        
        

      

    

     

     

    [Signature
page follows]

     

    


    
      
        
           


        

        
          B-4

          
            

          

        

        
           


        

      

    

    


     

    WITNESS
the facsimile signature of the proper officers of the Company and its corporate
seal.

     

    


     

    Dated
as of ______________, ____

     

    
      	 
      	
              CHICAGO
      RIVET & MACHINE CO.

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	
              By:

            	 
      
	 
      	 
      	
              Name:

            	 
      
	 
      	 
      	
              Title:

            	 
      
	 
      	 
      	 
      	 
      


    

    


    Countersigned:

    


    
      	
              CONTINENTAL
      STOCK TRANSFER

              &
      TRUST COMPANY,

              as
      Rights Agent

            
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
              By:

            	 
      	 
      
	 
      	
              Authorized
      Signature

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      


    

    


    

      
        
           


        

        
          B-5

          
            

          

        

        
           


        

      



    


     

    [Form
of Reverse Side of Rights Certificate]

     

    


     

    FORM OF
ASSIGNMENT

     

    


     

    (To
be executed by the registered holder if such

    holder
desires to transfer the Rights Certificate.)

     

    


     

    Please
print social security or other

    identifying
number of the transferor:________________________

     

     

    FOR
VALUE RECEIVED, _______________________ hereby sells, assigns and transfers
unto:

     

    


     

    ________________________________________

    (Please
print name and address of transferee)

     

     

    


     

     

    ________________________________________

    (Please
print social security or other

    identifying
number of the transferee)

     

     

    this
Rights Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint _____________________ Attorney,
to transfer the within Rights Certificate on the books of the within-named
Company, with full power of substitution.

     

    


    Dated:
__________________, _______

    


     

                                           


       

      
        	 	___________________________
	 	Signature


      

       

    

     

    


     

    Signature
Guaranteed:__________________________

     

    


    
      
        
           


        

        
          B-6

          
            

          

        

        
           


        

      

    

    


     

    Certificate

     

     

    The
undersigned hereby certifies by checking the appropriate boxes
that:

     

     

    (1)           this
Rights Certificate [ ] is [ ] is not being sold, assigned and transferred by or
on behalf of a Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are defined pursuant to
the Rights Agreement);

     

     

    (2)  after
due inquiry and to the best knowledge of the undersigned, it [ ] did [ ] did not
acquire the Rights evidenced by this Rights Certificate from any Person who is,
was or subsequently became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person.

     

    


    
      	
              Dated:_________________,
      ________

            	 
      	
              _______________________________

              Signature

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              Signature
      Guaranteed: ___________________________

               

            


    

    


     

    NOTICE

     

     

    The
signatures to the foregoing Assignment and Certificate must correspond to the
name as written upon the face of this Rights Certificate in every particular,
without alteration or enlargement or any change whatsoever.

     

    


    


    
      
        
           


        

        
          B-7

          
            

          

        

        
           


        

      

    

    


     

    FORM OF ELECTION TO
PURCHASE

     

     

    (to
be executed if the registered holder desires to

    exercise
Rights represented by the Rights Certificate)

     

     

    To:
CHICAGO RIVET & MACHINE CO.

     

     

    The
undersigned hereby irrevocably elects to exercise __________ Rights represented
by this Rights Certificate to purchase the shares of Preferred Stock issuable
upon the exercise of the Rights (or such other securities of the Company or of
any other person which may be issuable upon the exercise of the Rights) and
requests that certificates for such shares be issued in the name of and
delivered to:

     

    


     

    ________________________________________

    (Please
print name and address)

     

    


     

    ________________________________________

    (Please
print social security or other

    identifying
number)

     

     

    If
such number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance of such Rights shall be
registered in the name of and delivered to:

     

    


     

    ________________________________________

    (Please
print name and address)

     

    


     

    ________________________________________

     (Please
print social security or other

    identifying
number)

     

    


    Dated:_______________,
_______

     

    
      
         

        
          	 	___________________________
	 	Signature


        

         

      

    

     

    


    
      
        
           


        

        
          B-8

          
            

          

        

        
           


        

      

    

    


    


    Signature
Guaranteed:__________________________

    
 

    
      
        
           


        

        
          B-9

          
            

          

        

        
           


        

      

    

    


     

    Certificate

     

     

    The
undersigned hereby certifies by checking the appropriate boxes
that:

     

     

    (1)  the
Rights evidenced by this Rights Certificate [ ] are [ ] are not being exercised
by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are defined pursuant to
the Rights Agreement);

     

     

    (2)  after
due inquiry and to the best knowledge of the undersigned, it [ ] did [ ] did not
acquire the Rights evidenced by this Rights Certificate from any Person who is,
was or subsequently became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person.

     

    


    
      	
              Dated:_________________,
      _______

            	 
      	
              _______________________________

              Signature

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              Signature
      Guaranteed: ___________________________

               

            


    

    


     

    NOTICE

     

     

    The
signatures to the foregoing Election to Purchase and Certificate must correspond
to the name as written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any change
whatsoever.

     

    


    
      
        
           


        

        
          B-10

          
            

          

        

        
           


        

      

    

    


    


     

    Exhibit
C

    


     

    FORM
OF

    SUMMARY
OF RIGHTS TO PURCHASE

    PREFERRED
STOCK

     

    On
November 16, 2009, the Board of Directors (the “Board”) of Chicago
Rivet & Machine Co. (the “Company”) declared a
dividend distribution of one right (each, a “Right”) for each
outstanding share of common stock, par value $1.00 per share, of the Company
(the “Common
Stock”) to shareholders of record at the close of business on December 2,
2009 (the “Record
Date”).  Each Right entitles the registered holder to purchase
from the Company a unit consisting of one one-hundredth of a share (each, a
“Unit”) of
Series A Junior Participating Preferred Stock, no par value per share, of the
Company (the “Preferred Stock”) at
a purchase price of $75.00 per Unit, subject to adjustment (the “Purchase
Price”).  The description and terms of the Rights are set forth
in a Rights Agreement, dated as of November 16, 2009 (the “Rights Agreement”),
between the Company and Continental Stock Transfer & Trust Company, as
Rights Agent (the “Rights
Agent”).

     

    Rights Certificates;
Exercise Period

     

    Initially,
the Rights will be attached to all shares of Common Stock outstanding, and no
separate rights certificates (the “Rights Certificates”)
will be distributed.  Subject to certain exceptions specified in the
Rights Agreement, the Rights will separate from the Common Stock and a
distribution date (the “Distribution Date”)
will occur upon the earlier of (i) ten days following a public announcement that
a person or group of affiliated or associated persons (an “Acquiring Person”)
has acquired beneficial ownership of ten percent or more of the outstanding
shares of Common Stock (the date of such public announcement, the “Stock Acquisition
Date”), other than as a result of (a) repurchases of stock by the
Company, (b) certain inadvertent actions by institutional or certain other
shareholders or (c) the acquisition of stock pursuant to a Qualified Offer (as
defined below), or (ii) ten business days (or such later date as the Board shall
determine) following the commencement of a tender offer or exchange offer (other
than a Qualified Offer) that would result in a person or group becoming an
Acquiring Person. Certain existing stockholders of the Company are excluded from
the definition of “Acquiring Person” and the triggering provisions of the Rights
Agreement unless they acquire beneficial ownership of additional shares of
Common Stock in amounts and under circumstances described in the Rights
Agreement.

     

    Until the Distribution Date, (i) the Rights will be
evidenced by the Common Stock certificates (or, in the case of
uncertificated shares, by the balances indicated in the book entry account
system of the transfer agent for the Common Stock), and not by separate
certificates, (ii) the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock, (iii) new Common Stock certificates issued after the Record
Date will contain a notation incorporating the Rights Agreement by reference
(or, in the case of uncertificated shares, each direct registration
account statement with respect thereto

     

    


    
      
        
           


        

        
          C-1

          
            

          

        

        
           


        

      

    

    


     

    issued
after the Record Date will contain a notation to the effect that the Company
will mail to the shareholder a copy of the Rights Agreement without charge,
promptly after receipt of a written request therefor) and (iv) the surrender for
transfer of any shares of Common Stock outstanding will also constitute the
transfer of the Rights associated with such shares of Common Stock. Pursuant to
the Rights Agreement, the Company reserves the right to require prior to the
occurrence of a Triggering Event (as defined below) that, upon any exercise of
Rights, a number of Rights be exercised so that only whole shares of Preferred
Stock will be issued.

     

    The
Rights are not exercisable until the Distribution Date and will expire at 5:00
P.M. (New York City time) on December 1, 2019, unless such date is extended or
the Rights are earlier redeemed, exchanged or terminated by the
Company.

     

    As
soon as practicable after the Distribution Date, Rights Certificates will be
mailed to holders of record of the Common Stock as of the close of business on
the Distribution Date and, thereafter, the separate Rights Certificates alone
will represent the Rights.  Except as otherwise determined by the
Board, only shares of Common Stock issued prior to the Distribution Date will be
issued with the Rights.

     

    Flip-in
Trigger

     

    In
the event that a person or group of affiliated or associated persons becomes an
Acquiring Person, except pursuant to an offer for all outstanding shares of
Common Stock that at least a majority of the members of the Board who are not
officers of the Company and who are not representatives, nominees, affiliates or
associates of an Acquiring Person determines to be fair and not inadequate and
to otherwise be in the best interests of the Company and its shareholders, after
receiving advice from one or more investment banking firms (a “Qualified Offer”),
each holder of a Right, other than an Acquiring Person whose Rights would become
null and void, will thereafter have the right to receive, upon exercise, Common
Stock (or, in certain circumstances, cash, property or other securities of the
Company) having a value equal to two times the exercise price of the Right. For
example, at an exercise price of $75.00 per Right, each Right not owned by an
Acquiring Person (or by certain related parties) following an event set forth
above would entitle its holder to purchase $150.00 worth of Common Stock (or
other consideration, as noted above) for $75.00. Assuming that the Common Stock
had a per share value of $15.00 at such time, the holder of each valid Right
would be entitled to purchase 10 shares of Common Stock for $75.00. The Rights
would not be exercisable following the occurrence of an event set forth above
until such time as the Rights are no longer redeemable by the Company as set
forth below.

     

    Flip-over
Trigger

     

    In
the event that, at any time following the Stock Acquisition Date, (i) the
Company engages in a merger or other business combination transaction in which
the Company is not the surviving corporation (other than with an entity that
acquired the shares pursuant to a Qualified Offer), (ii) the Company engages in
a merger or other business combination transaction (other than with an entity
that acquired the shares pursuant to a Qualified Offer) in which the Company is
the surviving corporation and the Common Stock of the Company is changed or
exchanged, or (iii) 50% or more of the Company’s assets, cash flow or earning
power

     

    


    
      
        
           


        

        
          C-2

          
            

          

        

        
           


        

      

    

    


     

    is
sold or transferred, each holder of a Right (except Rights that have previously
been voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the surviving entity having a value equal to two times
the exercise price of the Right. The events set forth in this paragraph and in
the preceding paragraph are referred to as the “Triggering
Events.”

     

    Exchange
Feature

     

    At
any time after a person becomes an Acquiring Person, and prior to the
acquisition by such person or group of fifty percent (50%) or more of the
outstanding Common Stock, the Board may exchange the Rights (other than Rights
owned by such person or group that have become null and void), in whole or in
part, for Common Stock at an exchange ratio of one share of Common Stock, or one
one-hundredth of a share of Preferred Stock (or of a share of a class or series
of the Company’s preferred stock having equivalent rights, preferences and
privileges), per Right (subject to adjustment).

     

    Equitable
Adjustments

     

    The
Purchase Price payable, and the number of Units of Preferred Stock or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, (ii) if holders of the Preferred Stock are granted certain rights or
warrants to subscribe for Preferred Stock or convertible securities at less than
the current market price of the Preferred Stock, or (iii) upon the distribution
to holders of the Preferred Stock of evidences of indebtedness, assets or cash
(excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).

     

    With
certain exceptions, no adjustment in the Purchase Price will be required until
cumulative adjustments amount to at least one percent of the Purchase
Price.  No fractional Units will be issued and, in lieu thereof, an
adjustment in cash will be made based on the market price of the Preferred Stock
on the last trading day prior to the date of exercise.

     

    Redemption
Rights

     

    At
any time until ten days following the Stock Acquisition Date, the Company may
redeem the Rights in whole, but not in part, at a price of $0.01 per Right
(payable in cash, Common Stock or other consideration deemed appropriate by the
Board).  Immediately upon the action of the Board ordering redemption
of the Rights, the Rights will terminate and the only right of the holders of
Rights will be to receive the $0.01 redemption price.

     

    Amendment of
Rights

     

    Any
of the provisions of the Rights Agreement may be amended by the Board prior to
the Distribution Date.  After the Distribution Date, the provisions of
the Rights Agreement may be amended by the Board in order to cure any ambiguity,
to make changes that do not adversely affect the interests of holders of Rights
or to shorten or lengthen any time period under the Rights
Agreement.  The foregoing notwithstanding, no amendment may be made to
the Rights Agreement at such time as the Rights are not redeemable, except to
cure any

     

    


    
      
        
           


        

        
          C-3

          
            

          

        

        
           


        

      

    

    


     

    ambiguity
or correct or supplement any provision contained in the Rights Agreement that
may be defective or inconsistent with any other provision therein.

     

    Miscellaneous

     

    Until
a Right is exercised, the holder thereof, as such, will have no separate rights
as a shareholder of the Company, including, without limitation, the right to
vote or to receive dividends in respect of the Rights.  While the
distribution of the Rights will not be taxable to shareholders or to the
Company, shareholders may, depending upon the circumstances, recognize taxable
income in the event that the Rights become exercisable for Common Stock (or
other consideration) of the Company or for common stock of an acquiring company
or in the event of the redemption of the Rights as set forth above.

     

    A
copy of the Rights Agreement has been or will be filed with the Securities and
Exchange Commission as an exhibit to a Current Report on Form 8-K.  A
copy of the Rights Agreement is available free of charge from the Rights
Agent.  This summary description of the Rights and the Rights
Agreement does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement, which is incorporated herein by
reference.

     

     *
* * * *

     

     

    C-4