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EXHIBIT 4.2    
  


 
  AMENDMENT NO. 1
  
    TO
  
    RIGHTS AGREEMENT    
  


        This Amendment No. 1 to Rights Agreement (this "Amendment") is dated as of March 26, 2002 by and between FIBERSTARS, INC., a California
corporation (the "Company"), and MELLON INVESTOR SERVICES LLC, a New Jersey limited liability company, as Rights Agent (the "Rights Agent"), with reference to the following: 



        A.    The
Company and the Rights Agent entered into that certain Rights Agreement dated as of September 20, 2001 (the "Agreement") in order to implement a shareholder
rights plan as more fully described therein. 


        B.    The
Company desires to amend the Agreement in certain respects in order to permit Trigran Investments LP (or any of its affiliates) to purchase additional shares of
Common Stock of the Company without triggering the occurrence of the Distribution Date (as defined in the Agreement). 


        C.    Under
the Agreement, the Company and the Rights Agent may amend the Agreement, at any time prior to the Distribution Date, which has yet to occur. 



        NOW,
THEREFORE, pursuant to Section 27 of the Agreement, the Company and the Rights Agent hereby amend, effective upon the date hereof, the definition of the term "Acquiring
Person" set forth in Section 1(a) of the Agreement such that Section 1(a)(ii) of the
Agreement shall read in its entirety as follows: 



        "(ii) the
term Acquiring Person shall not mean: 



        (A)  the
Company; 


        (B)  any
Subsidiary (as such term is hereinafter defined) of the Company; 


        (C)  any
employee benefit plan of the Company or any of its Subsidiaries; 


        (D)  any
entity holding securities of the Company organized, appointed or established by the Company or any of its Subsidiaries for or pursuant to the terms of any such plan; 


        (E)  any
underwriter acting in good faith in a firm commitment underwriting of an offering of the Company's securities pursuant to arrangements with the Company that have
been approved by the Board (however, the exception provided by this clause (E) shall no longer be
available in the event that any such underwriter is otherwise an Acquiring Person on or after the date which is forty (40) days after the date of initial acquisition of the Company's securities
by such underwriter in connection with such offering); 


        (F)  Advanced
Lighting Technologies, Inc. (referred to collectively with its Affiliates and Associates as "ADLT"), so long as ADLT is not the Beneficial Owner of a
percentage of the outstanding shares of Common Stock that is greater (by more than one percent (1%) of the outstanding shares of Common Stock) than (1) the percentage of the outstanding shares
of Common Stock as to which ADLT has Beneficial Ownership on the date hereof or (2) such lesser percentage as to which ADLT has Beneficial Ownership following any transfer or exercise of
securities Beneficially Owned by ADLT, or the expiration or cancellation of any securities Beneficially Owned by ADLT, after the date hereof (except that this clause (F)  shall pertain only until
such time as ADLT has Beneficial Ownership of less than fifteen percent (15%) of the outstanding shares of Common Stock); or 


        (G)  Trigran
Investments LP, an Illinois limited partnership (referred to collectively with their Affiliates and Associates as "Trigran"), so long as Trigran is not the
Beneficial Owner of a percentage of the outstanding shares of Common Stock that is greater (by more than one percent (1%) of the outstanding shares of Common Stock) than (1) the percentage of
the 













outstanding shares of Common Stock represented by the sum of (x) the shares as to which Trigran has Beneficial Ownership immediately prior to the "Closing" (as that term is defined in that
certain Common Stock and Warrant Purchase Agreement, dated March, 2002, entered into by the Company and each of the "Investors" named therein, the "Purchase Agreement"), plus (y) the shares as
to which Trigran obtains Beneficial Ownership, pursuant to the transactions described in the Purchase Agreement, or (2) such lesser percentage as to which Trigran has Beneficial Ownership
following any disposal of Common Stock by Trigran after such Closing (except that this clause (G) shall pertain only until such time as Trigran
has Beneficial Ownership of less than fifteen percent (15%) of the outstanding shares of Common Stock); and" 





        This
Amendment may be executed in any number of counterparts, each which shall be deemed an original, and all of this together shall constitute one instrument. This Amendment shall be
deemed to be a contract made under the laws of the State of the Company's jurisdiction of incorporation and for all purposes shall be governed by and construed in accordance with the laws of such
state applicable to contracts to be made and to be performed entirely within such state; provided, however, that all provisions regarding the rights,
duties and obligations of the Rights Agent under the Agreement, as amended by this Amendment, shall continue to be governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed entirely within such State. Except as specifically amended by this Amendment, all other terms and conditions of the Agreement shall remain in full
force and effect and are hereby ratified and confirmed. 


[signature
page to follow] 






        IN
WITNESS WHEREOF, this Amendment is executed as of the date first written above. 



	 	 	FIBERSTARS, INC.
	

 	
 	

 	

 
	 	 	By:	/s/  ROBERT G. CONNORS      

	 	 	Name:	Robert G. Connors
	 	 	Title:	Chief Financial Officer
	

 	
 	

 	

 
	 	 	MELLON INVESTOR SERVICES LLC
	

 	
 	

 	

 
	 	 	By:	/s/  WILLIAM A. DOUGHERTY      

	 	 	Name:	William A. Dougherty
	 	 	Title:	Assistant Vice President
	

 	
 	

 	

 











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EXHIBIT 4.2


AMENDMENT NO. 1 TO RIGHTS AGREEMENT