EXECUTION VERSION


                                RIGHTS AGREEMENT

                          Dated as of October 12, 2001

                                  by and among


                               FRESH BRANDS, INC.

                                       and

                               FIRSTAR BANK, N.A.

                                  Rights Agent



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                                TABLE OF CONTENTS
                                                                            Page

Section 1.    Certain Definitions..............................................1

Section 2.    Appointment of Rights Agent......................................3

Section 3.    Issue of Right Certificates......................................4

Section 4.    Form of Right Certificates.......................................5

Section 5.    Countersignature and Registration................................6

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

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

Section 8.    Cancellation and Destruction of Right Certificates...............8

Section 9.    Reservation and Availability of Common Shares....................9

Section 10.   Common Shares Record Date........................................9

Section 11.   Adjustment of Purchase Price, Number of Shares or
              Number of Rights................................................10

Section 12.   Certificate of Adjusted Purchase Price or Number of Shares......16

Section 13.   Consolidation, Merger, Share Exchange or Sale or Transfer
              of Assets or Earning Power......................................17

Section 14.   Fractional Rights and Fractional Shares.........................19

Section 15.   Rights of Action................................................20

Section 16.   Agreement of Right Holders......................................20

Section 17.   Right Certificate Holder Not Deemed a Shareholder...............21

Section 18.   Concerning the Rights Agent.....................................21

Section 19.   Merger or Consolidation or Change of Name of Rights Agent.......22

Section 20.   Duties of Rights Agent..........................................22

Section 21.   Change of Rights Agent..........................................24

Section 22.   Issuance of New Right Certificates..............................25

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Section 23.   Redemption......................................................25

Section 24.   Exchange........................................................26

Section 25.   Notice of Certain Events........................................27

Section 26.   Notices.........................................................28

Section 27.   Supplements and Amendments......................................29

Section 28.   Successors......................................................29

Section 29.   Benefits of this Agreement......................................29

Section 30.   Severability....................................................29

Section 31.   Governing Law...................................................30

Section 32.   Counterparts....................................................30

Section 33.   Descriptive Headings............................................30

Section 34.   Determinations and Actions by the Board of Directors............30

Exhibit A -   Form of Right Certificate

Exhibit B -   Summary of Rights to Purchase Common Shares



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<PAGE>
                                RIGHTS AGREEMENT
                                ----------------

          This Agreement, is dated as of October 12, 2001, between Fresh Brands,
Inc., a Wisconsin corporation (the "Company"), and Firstar Bank, N.A.,
Milwaukee, Wisconsin, a National Banking Association (the "Rights Agent").

          WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one common share purchase right (a "Right") for each
Common Share (as hereinafter defined) of the Company outstanding on November 9,
2001 (the "Record Date") payable on November 23, 2001 (the "Payment Date"), and
has authorized and directed the issuance of one Right with respect to each
Common Share that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date and the Final Expiration
Date (as such terms are hereinafter defined), each Right representing the right
to purchase one Common Share of the Company, subject to adjustment as
hereinafter provided, and upon the terms and subject to the conditions
hereinafter set forth;

          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) "Acquiring Person" shall mean any Person who or which, together
     with all Affiliates and Associates of such Person, shall be the Beneficial
     Owner of 20% or more of the Common Shares then outstanding, but shall not
     include the Company, any Subsidiary of the Company or any employee benefit
     plan of the Company or any Subsidiary of the Company, or any entity holding
     Common Shares for or pursuant to the terms of any such plan, or any
     trustee, administrator or fiduciary of such a plan. Notwithstanding the
     foregoing, no Person shall become an "Acquiring Person" as the result of an
     acquisition of Common Shares by the Company which, by reducing the number
     of shares outstanding, increases the proportionate number of shares
     beneficially owned by such Person to 20% or more of the Common Shares then
     outstanding; provided, however, that if a Person becomes the Beneficial
     Owner of 20% or more of the Common Shares then outstanding by reason of
     share purchases by the Company and shall, after such share purchases by the
     Company, become the Beneficial Owner of any additional Common Shares (other
     than Common Shares acquired solely as a result of corporate action of the
     Company not caused, directly or indirectly, by such Person), then such
     Person shall be deemed to be an "Acquiring Person." Notwithstanding the
     foregoing, if the Board of Directors of the Company determines in good
     faith that a Person who would otherwise be an "Acquiring Person," as
     defined pursuant to the foregoing provisions of this paragraph (a), has
     become such inadvertently, and such Person divests as promptly as
     practicable a sufficient number of Common Shares so that such Person would
     no longer be an "Acquiring Person," as defined pursuant to the foregoing
     provisions of this paragraph (a), then such Person shall not be deemed to
     be an "Acquiring Person" for any purposes of this Agreement.
<PAGE>

          (b) "Affiliate" and "Associate" shall have the respective meanings
     ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
     under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
     as in effect on the date of this Agreement.

          (c) 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 beneficially owns, directly or indirectly;

               (ii) which such Person or any of such Person's Affiliates or
          Associates has (A) the right to acquire (whether such right is
          exercisable immediately or only after the passage of time) pursuant to
          any agreement, arrangement or understanding (other than customary
          agreements with and between underwriters and selling group members
          with respect to a bona fide public offering of securities), or upon
          the exercise of conversion rights, exchange rights, rights (other than
          these Rights), warrants or options, or otherwise; provided, however,
          that a Person shall not be deemed the Beneficial Owner of, or to
          beneficially own, securities tendered pursuant to a tender or exchange
          offer made by or on behalf of such Person or any of such Person's
          Affiliates or Associates until such tendered securities are accepted
          for purchase or exchange; or (B) the right to vote pursuant to any
          agreement, arrangement or understanding; provided, however, that a
          Person shall not be deemed the Beneficial Owner of, or to beneficially
          own, any security if the agreement, arrangement or understanding to
          vote such security (1) arises solely from a revocable proxy or consent
          given to such Person in response to a public proxy or consent
          solicitation made pursuant to, and in accordance with, the applicable
          rules and regulations of the Exchange Act and (2) is not also then
          reportable 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 with which such Person or any of such Person's
          Affiliates or Associates has any agreement, arrangement or
          understanding (other than customary agreements with and between
          underwriters and selling group members with respect to a bona fide
          public offering of securities) for the purpose of, or with respect to,
          acquiring, holding, voting (except to the extent contemplated by the
          proviso to Section l(c)(ii)(B)) or disposing of any securities of the
          Company.

          Notwithstanding anything in this definition of Beneficial Ownership to
     the contrary, the phrase "then outstanding," when used with reference to a
     Person's Beneficial Ownership of securities of the Company, shall mean the
     number of such securities then issued and outstanding together with the
     number of such securities not then actually issued and outstanding which
     such Person would be deemed to beneficially own hereunder.


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<PAGE>

          (d) "Business Day" shall mean any day other than a Saturday, a Sunday,
     or a day on which banking institutions in the State of Wisconsin are
     authorized or obligated by law or executive order to close.

          (e) "Close of business" on any given date shall mean 5:00 P.M.,
     Milwaukee, Wisconsin, on such date; provided, however, that if such date is
     not a Business Day it shall mean 5:00 P.M., Milwaukee, Wisconsin time, on
     the next succeeding Business Day.

          (f) Unless the context of the reference expressly indicated otherwise,
     "Common Shares" shall mean the shares of common stock, par value $.05, of
     the Company, or shares having equivalent rights, privileges and preferences
     to common stock. "Common Shares" when used with reference to any Person
     other than the Company shall mean the capital stock (or equivalent equity
     interest) with the greatest voting power of such other Person or, if such
     other Person is a Subsidiary of another Person, the Person or Persons which
     ultimately control such first-mentioned Person.

          (g) "Distribution Date" shall have the meaning set forth in Section
     3(a) hereof.

          (h) "Final Expiration Date" shall have the meaning set forth in
     Section 7 hereof.

          (i) "Person" shall mean any individual, firm, corporation, limited
     liability company, trust or other entity, and shall include any successor
     (by merger or otherwise) of such entity.

          (j) "Redemption Date" shall have the meaning set forth in Section 7
     hereof.

          (k) "Shares 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.

          (l) "Subsidiary" of any Person shall mean any corporation or other
     entity of which a majority of the voting power of the voting equity
     securities or equity interest is owned, directly or indirectly, by such
     Person.

          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 Common Shares) 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. No such appointment shall change or increase the Rights
Agent's duties, liabilities or obligations under this Agreement. The Rights
Agent shall have no duty to supervise, and in no event shall the Rights Agent be
liable for, the acts or omissions of any such co-Rights Agent appointed by the
Company.


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<PAGE>

          Section 3. Issue of Right Certificates.

          (a) Until the earlier of (i) the tenth day after the Shares
     Acquisition Date or (ii) the tenth Business Day (or such later date as may
     be determined by action of the Company's Board of Directors prior to such
     time as any Person becomes an Acquiring Person) after the date of the
     commencement of, or of the first public announcement of the intention of
     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,
     any entity holding Common Shares for or pursuant to the terms of any such
     plan, or any trustee, administrator, or fiduciary of such a plan) to
     commence, a tender or exchange offer the consummation of which would result
     in any Person becoming the Beneficial Owner of Common Shares aggregating
     20% or more of the then outstanding Common Shares (including in either case
     any such date which is after the date of this Agreement and prior to the
     Payment Date; the earlier of such dates being herein referred to as the
     "Distribution Date"; provided, however, that if the tenth day or Business
     Day, as the case may be, after the pertinent date occurs before the Record
     Date, "Distribution Date" shall mean the Record Date), (x) the Rights will
     be evidenced (subject to the provisions of Section 3(b) hereof) by the
     certificates for Common Shares registered in the names of the holders
     thereof (which certificates shall also be deemed to be Right Certificates)
     and not by separate Right Certificates, and (y) the right to receive Right
     Certificates will be transferable only in connection with the transfer of
     Common Shares. If the Rights Agent is not then the Transfer Agent and
     Registrar of the Common Shares, then upon the occurrence of a Distribution
     Date, the Company shall promptly notify the Rights Agent and request a
     stockholder list from the Company's Transfer Agent. As soon as practicable
     after the Distribution Date, the Company will prepare and execute, the
     Rights Agent will countersign, and the Company will send or cause to be
     sent (and the Rights Agent will, if requested, send) by first-class,
     insured, postage-prepaid mail, to each record holder of Common Shares as of
     the close of business on the Distribution Date, at the address of such
     holder shown on the records of the Company, a Right Certificate, in
     substantially the form of Exhibit A hereto (a "Right Certificate"),
     evidencing one Right for each Common Share so held. As of the Distribution
     Date, the Rights will be evidenced solely by such Right Certificates.

          (b) On or before the Payment Date, or as soon as practicable
     thereafter, the Company will send a copy of a Summary of Rights to Purchase
     Common Shares, in substantially the form of Exhibit B hereto (the "Summary
     of Rights"), by first class, postage-prepaid mail, to each record holder of
     Common Shares as of the close of business on the Record Date, at the
     address of such holder shown on the records of the Company. With respect to
     certificates for Common Shares outstanding as of the Record Date, until the
     Distribution Date, the Rights will be evidenced by such certificates
     registered in the names of the holders thereof. Until the Distribution Date
     (or the earlier of the Redemption Date or Final Expiration Date), the
     surrender for transfer of any certificate for Common Shares outstanding on
     the Record Date, with or without a copy of the Summary of Rights attached
     thereto, shall also constitute the transfer of the Rights associated with
     the Common Shares represented thereby.


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<PAGE>

          (c) Certificates for Common Shares which become outstanding
     (including, without limitation, certificates for reacquired Common Shares
     referred to in the last sentence of this paragraph (c) and certificates
     issued on the transfer of Common Shares) after the Record Date but prior to
     the earliest of the Distribution Date, the Redemption Date or the Final
     Expiration Date shall have impressed on, printed on, written on or
     otherwise affixed to them a legend in substantially the following form:

          This certificate also evidences and entitles the holder
          hereof to certain Rights as set forth in a Rights Agreement
          between Fresh Brands, Inc. and Firstar Bank, N.A., dated as
          of October 12, 2001, and as such agreement may be amended
          (the "Rights Agreement"), the terms of which are hereby
          incorporated herein by reference and a copy of which is on
          file at the principal executive offices of Fresh Brands,
          Inc. 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. Fresh Brands, Inc. will mail to the holder of
          this certificate a copy of the Rights Agreement without
          charge after receipt of a written request therefor. Under
          certain circumstances set forth in the Rights Agreement,
          Rights issued to, or held by, an Acquiring Person or any
          Affiliate or Associate thereof (as such terms are defined in
          the Rights Agreement), whether held by such Person or any
          subsequent holder shall become null and void.

With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Shares represented by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares represented thereby. In
the event that the Company purchases or acquires any Common Shares after the
Record Date but prior to the Distribution Date, any Rights associated with such
Common Shares shall be deemed cancelled and retired so that the Company shall
not be entitled to exercise any Rights associated with the Common Shares which
are no longer outstanding.

          Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase Common Shares and of assignment to be printed on
the reverse thereof) shall be substantially the same as Exhibit A hereto and may
have such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate (which do not
affect the duties or responsibilities of the Rights Agent) 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 22 hereof, the Right Certificates shall entitle the
holders thereof to purchase such number of Common Shares as shall be set forth
therein at the price per Common Share set forth therein (the "Purchase Price"),
but the amount and type of securities purchasable upon exercise of each Right
and the Purchase Price shall be subject to adjustment as provided herein.


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<PAGE>
          Section 5. Countersignature and Registration.

          (a) The Right Certificates shall be executed on behalf of the Company
     by its Chairman of the Board, President or any Vice President, either
     manually or by facsimile signature, shall have affixed thereto the
     Company's seal or a facsimile thereof, and shall be attested by the
     Secretary or an Assistant Secretary of the Company, either manually or by
     facsimile signature. The Right Certificates shall be manually countersigned
     by the Rights Agent and shall not be valid for any purpose unless
     countersigned. In case any officer of the Company who shall have signed any
     of the Right Certificates shall cease to be such officer of the Company
     before countersignature by the Rights Agent and issuance and delivery by
     the Company, such Right 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 individual who signed such Right
     Certificates had not ceased to be such officer of the Company; and any
     Right Certificate may be signed on behalf of the Company by any person who,
     at the actual date of the execution of such Right Certificate, shall be a
     proper officer of the Company to sign such Right Certificate, although at
     the date of the execution of this Rights Agreement any such individual was
     not such an officer.

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

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

          (a) Subject to the provisions of 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 earlier of the Redemption Date or the Final
     Expiration Date, any Right Certificate or Right Certificates (other than
     Right Certificates representing Rights that have become void pursuant to
     Section 11(a)(ii) hereof or that have been exchanged pursuant to Section 24
     hereof) may be transferred, split up, combined or exchanged for another
     Right Certificate or Right Certificates, entitling the registered holder to
     purchase a like number of Common Shares as the Right Certificate or Right
     Certificates surrendered then entitled such holder to purchase. Any
     registered holder desiring to transfer, split up, combine or exchange any
     Right Certificate or Right Certificates shall make such request in writing
     delivered to the Rights Agent, and shall surrender the Right Certificate or
     Right Certificates to be transferred, split up, combined or exchanged at
     the principal office of the Rights Agent. Thereupon the Rights Agent shall
     countersign and deliver to the person entitled thereto a Right Certificate
     or Right Certificates, as the case may be, as so requested. The Company may
     require payment of a sum sufficient to cover any tax or governmental charge
     that may be imposed in connection with any transfer, split up, combination
     or exchange of Right Certificates. The Rights Agent shall have no duty or
     obligation to take any action under any Section of this Agreement which
     requires the


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<PAGE>

     payment by a Rights holder of applicable taxes and governmental charges
     unless and until the Rights Agent is satisfied that all such taxes and/or
     charges have been paid.

          (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 Right Certificate and, in case of loss, theft or
     destruction, of indemnity or security reasonably satisfactory to them, and,
     at the Company's request, 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 Right Certificate if mutilated, the
     Company will make and deliver a new Right Certificate of like tenor to the
     Rights Agent for delivery to the registered holder in lieu of the Right
     Certificate so lost, stolen, destroyed or mutilated.

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

          (a) Each Right shall be exercisable to purchase one Common Share,
     subject to further adjustment as provided herein. The registered holder of
     any Right Certificate may exercise the Rights evidenced thereby (except as
     otherwise provided herein) in whole or in part at any time after the
     Distribution Date upon surrender of the Right Certificate, with the form of
     election to purchase on the reverse side thereof duly executed, to the
     Rights Agent at the principal office of the Rights Agent, together with
     payment of the Purchase Price for each Common Share as to which the Rights
     are exercised, at or prior to the earliest of (i) the close of business on
     November 9, 2011, subject to extension, (the "Final Expiration Date"), (ii)
     the time at which the Rights are redeemed as provided in Section 23 hereof
     (the "Redemption Date"), and (iii) the time at which such Rights are
     exchanged as provided in Section 24 hereof; provided, however, that if the
     number of Rights exercised would entitle the holder thereof to receive any
     fraction of a Common Share greater than one-half of a share, the holder
     thereof shall not be entitled to exercise such Rights unless such holder
     concurrently purchases from the Company (and in such event the Company
     shall sell to such holder), at a price in proportion to the Purchase Price,
     an additional fraction of a Common Share which, when added to the number of
     Common Shares to be received upon such exercise, will equal an integral
     number of Common Shares.

          (b) The Purchase Price for each Common Share pursuant to the exercise
     of a Right shall initially be $50.00, shall be subject to adjustment from
     time to time as provided in Sections 11 and 13 hereof and shall be payable
     in lawful money of the United States of America or in Common Shares in
     accordance with paragraph (c) below.

          (c) Upon receipt of a Right Certificate representing exercisable
     Rights, with the form of election to purchase duly executed, accompanied by
     payment of the Purchase Price for the Common Shares to be purchased as set
     forth below and an amount equal to any applicable transfer tax required to
     be paid by the holder of such Right Certificate in accordance with Section
     9 hereof, the Rights Agent shall thereupon promptly (i) requisition from
     any transfer agent of the Common Shares certificates for the number of
     Common Shares to be purchased and the Company hereby irrevocably authorizes
     its transfer agent to comply with all such requests, (ii) when appropriate,
     requisition from the Company the amount of cash to be paid in lieu of
     issuance of fractional Common


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<PAGE>

     Shares in accordance with Section 14 hereof, (iii) after receipt of such
     Common Share certificates, cause the same to be delivered to or upon the
     order of the registered holder of such Right Certificate, registered in
     such name or names as may be designated by such holder, and (iv) when
     appropriate, after receipt, deliver such cash to or upon the order of the
     registered holder of such Right Certificate. The payment of the Purchase
     Price (as such amount may be reduced pursuant to Section 11(a)(iii) hereof
     shall be made by certified check, cashier's check, bank draft or money
     order payable to the order of the Company, except that, if so provided by
     the Board of Directors of the Company, the payment of the Purchase Price
     following the occurrence of a Section 11(a)(ii) Event (as hereinafter
     defined) and until the first occurrence of a Section 13 Event (as such term
     is hereinafter defined) may be made wholly or in part by delivery of a
     certificate or certificates (with appropriate stock powers executed in
     blank attached thereto) evidencing a number of Common Shares equal to the
     then Purchase Price divided by the closing price (as determined pursuant to
     Section 11(d) hereof) per Common Share on the Trading Day (as such term is
     hereinafter defined) immediately preceding the date of such exercise. If
     the Company is obligated to issue other securities 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.

          (d) In case the registered holder of any Right Certificate shall
     exercise less than all the Rights evidenced thereby, a new Right
     Certificate evidencing Rights equivalent to the Rights remaining
     unexercised shall be issued by the Rights Agent to the registered holder of
     such Right Certificate or to his duly authorized assigns, subject to the
     provisions of Sections 6 and 14 hereof.

          (e) Notwithstanding anything in this Agreement to the contrary,
     neither the Rights Agent nor the Company shall be obligated to take any
     action with respect to a registered holder of a Right Certificate upon the
     occurrence of any purported transfer, assignment or exercise as set forth
     in this Section 7 unless such registered holder shall have (i) completed
     and signed the certificate following the form of assignment or election to
     purchase set forth on the reverse of the Right Certificate surrendered for
     such transfer, assignment or 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 Right Certificates. All
Right Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to 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 Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all cancelled Right Certificates to the Company or shall, at the written request
of the Company, destroy such cancelled Right Certificates, and in such case
shall deliver a certificate of destruction thereof to the Company.


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<PAGE>

          Section 9. Reservation and Availability of Common Shares.

          (a) The Company covenants and agrees that it will cause to be reserved
     and kept available out of its authorized and unissued Common Shares or any
     authorized and issued Common Shares held in its treasury, the number of
     Common Shares that will be sufficient to permit the exercise in full of all
     outstanding Rights in accordance with Section 7.

          (b) So long as the Common Shares issuable upon the exercise of 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, all Common Shares reserved for such issuance to be listed on
     such exchange upon official notice of issuance upon such exercise.

          (c) The Company covenants and agrees that it will take all such action
     as may be necessary to ensure that all Common Shares 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 shares (except as
     otherwise provided by any corporation law applicable to the Company).

          (d) 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 Right
     Certificates or of any Common Shares 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 Right Certificates to
     a person other than, or the issuance or delivery of certificates for the
     Common Shares in a name other than that of, the registered holder of the
     Right Certificate evidencing Rights surrendered for exercise or to issue or
     to deliver any certificates for Common Shares upon the exercise of any
     Rights until any such tax shall have been paid (any such tax being payable
     by the holder of such Right Certificate at the time of surrender) or until
     it has been established to the Company's reasonable satisfaction that no
     such tax is due. The Rights Agent shall have no duty or obligation to take
     any action under any Section of this Agreement which requires the payment
     by a Rights holder of applicable taxes and governmental charges unless and
     until the Rights Agent is satisfied that all such taxes and/or charges have
     been paid.

          Section 10. Common Shares Record Date. Each Person in whose name any
certificate for Common Shares is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the Common Shares
represented thereby on, and such certificate shall be dated, the date upon which
the Right Certificate evidencing such Rights was duly surrendered and payment of
the Purchase Price (and any applicable transfer taxes and other governmental
charges) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Common Shares transfer books of the Company are
closed, such Person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next succeeding Business Day
on which the Common Shares transfer books of the Company are open.


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<PAGE>

          Section 11. Adjustment of Purchase Price, Number of Shares or Number
of Rights. The Purchase Price, the number of Common 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 Common Shares payable in
     Common Shares, (B) subdivide the outstanding Common Shares, (C) combine the
     outstanding Common Shares into a smaller number of Common Shares or (D)
     issue any shares of its capital stock in a reclassification of the Common
     Shares (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), the
     Purchase Price in effect at the time of the record date for such dividend
     or of the effective date of such subdivision, combination or
     reclassification, and the number and kind of shares of capital stock
     issuable on such date, shall be proportionately adjusted so that the holder
     of any Right exercised after such time shall be entitled to receive the
     aggregate number and kind of shares of capital stock which, if such Right
     had been exercised immediately prior to such date and at a time when the
     Common Shares 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, combination or reclassification; provided,
     however, that in no event shall the consideration to be paid upon the
     exercise of one Right be less than the aggregate par value of the shares of
     capital stock of the Company issuable upon exercise of one Right. If an
     event occurs which would require an adjustment under both Section 11(a)(i)
     and Section 11(a)(ii), 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).

               (ii) Subject to Section 24 of this Agreement, in the event any
          Person shall become an Acquiring Person, other than pursuant to any
          transaction set forth in Section 13(a) each holder of a Right shall
          thereafter have a right to receive, upon exercise thereof at a price
          equal to the then current Purchase Price multiplied by the number of
          Common Shares for which a Right is then exercisable, in accordance
          with the terms of this Agreement, such number of Common Shares as
          shall equal the result obtained by (x) multiplying the then current
          Purchase Price by the number of Common Shares for which a Right is
          then exercisable and dividing that product by (y) 50% of the then
          current per share market price of the Common Shares (determined
          pursuant to Section 11(d)) on the date the Person became an Acquiring
          Person (such number of shares, the "Adjustment Shares").

               From and after such time as a Person becomes and Acquiring Person
          (a "Section 11(a)(ii) Event"), any Rights that are or were acquired or
          beneficially owned by such Acquiring Person (or any Associate or
          Affiliate of such Acquiring Person) shall be void and any holder of
          such Rights shall thereafter have no right to exercise such Rights
          under any provision of this Agreement. No Right Certificate shall be
          issued pursuant to Section 3 that represents Rights beneficially owned
          by an Acquiring Person whose Rights would


                                       10
<PAGE>

          be void pursuant to the preceding sentence or any Associate or
          Affiliate thereof; no Right Certificate shall be issued at any time
          upon the transfer of any Rights to an Acquiring Person whose Rights
          would be void pursuant to the preceding sentence or any Associate or
          Affiliate thereof or to any nominee of such Acquiring Person,
          Associate or Affiliate; and any Right Certificate delivered to the
          Rights Agent for transfer to an Acquiring Person whose Rights would be
          void pursuant to the preceding sentence shall be cancelled. The
          Company shall use all reasonable efforts to ensure that the provisions
          of this paragraph are complied with, but shall have no liability to
          any holder of Right Certificates or other Person as a result of its
          failure to make any determinations with respect to an Acquiring Person
          or its Affiliates, Associates or transferees hereunder.

               (iii) In the event that there shall not be sufficient Common
          Shares issued but not outstanding or authorized but unissued (and not
          reserved for issuance for purposes other than upon the exercise of the
          Rights) to permit the exercise in full of the Rights in accordance
          with the foregoing subparagraph (ii), the Company shall: (A) determine
          the excess of (1) the value of the Adjustment Shares issuable upon the
          exercise of a Right (the "Current Value") over (2) the Purchase Price
          payable with respect to such Right (such excess, the "Spread"), and
          (B) with respect to each Right, make adequate provision to substitute
          for the Adjustment Shares, upon payment of the applicable Purchase
          Price, (1) cash, (2) a reduction in the Purchase Price, (3) Common
          Shares or other equity securities of the Company (including, without
          limitation, shares, or units of shares, of preferred stock, if any,
          which the Board of Directors of the Company has deemed to have the
          same value as Common Shares (such shares of preferred stock,
          hereinafter referred to 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,
          where such aggregate value has been determined by the Board of
          Directors of the Company based upon the advice of a reputable regional
          investment banking firm selected by the Board of Directors of the
          Company; provided, however, if the Company shall not have made
          adequate provision to substitute for the Adjustment Shares pursuant to
          clause (B) above within thirty (30) days following the occurrence of a
          Section 11(a)(ii) Event (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 any portion of
          the Purchase Price, Common Shares (to the extent available) and then,
          if necessary, cash, which shares and/or cash have an aggregate value
          equal to the Spread. If the Board of Directors of the Company shall
          determine in good faith that it is likely that sufficient additional
          Common Shares might be authorized for issuance for 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 period, as it may be extended, the "Substitution Period"). To
          the extent that the Company determines that some action need be taken
          pursuant to the first and/or second sentences of this Section
          11(a)(iii), the Company (x) shall provide, subject to the last
          paragraph of Section 11(a)(ii) hereof, that such action shall apply
          uniformly


                                       11
<PAGE>

          to all outstanding Rights, and (y) may suspend the exercisability of
          the Rights until the expiration of the Substitution Period to seek any
          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 the
          Common Shares shall be the current per share market price (as
          determined pursuant to Section 11(d) hereof) of the Common Shares on
          the Section 11(a)(ii) Trigger Date and the value of any "common stock
          equivalent" shall be deemed to have the same value as the Common
          Shares on such date.

          (b) In case the Company shall fix a record date for the issuance of
     rights, options or warrants to all holders of Common Shares entitling them
     (for a period expiring within 45 calendar days after such record date) to
     subscribe for or purchase Common Shares (or securities convertible into
     Common Shares) at a price per Common Share (or having a conversion price
     per share, if a security convertible into Common Shares) less than the then
     current per share market price of the Common Shares (as defined in Section
     11(d)) 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 Common Shares outstanding on such record date plus
     the number of Common Shares which the aggregate offering price of the total
     number of Common Shares 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 Common Shares outstanding on such record date plus the number
     of additional Common Shares to be offered for subscription or purchase (or
     into which the convertible securities so to be offered are initially
     convertible); provided, however, that in no event shall the consideration
     to be paid upon the exercise of one Right be less than the aggregate par
     value of the shares of capital stock of the Company issuable upon exercise
     of one Right. In case such subscription price may be paid in a
     consideration part or all of which shall be in a form other than cash, the
     value of such consideration shall be as determined in good faith by the
     Board of Directors of the Company, whose determination shall be described
     in a statement filed with the Rights Agent. Common Shares 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,
     options 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 the making of a
     distribution to all holders of the Common Shares (including any such
     distribution made in connection with a consolidation or merger in which the
     Company is the continuing or surviving corporation) of evidences of
     indebtedness or assets (other than a regular quarterly cash dividend or a
     dividend payable in Common Shares) or subscription rights or warrants
     (excluding those referred to in Section 11(b)), the Purchase Price to be in


                                       12
<PAGE>

     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 then current per share market
     price of the Common Shares (as defined in Section 11(d)) on such record
     date, less the fair market value (as determined in good faith by the Board
     of Directors of the Company, whose determination shall be described in a
     statement filed with the Rights Agent) of the portion of the assets or
     evidences of indebtedness so to be distributed or of such subscription
     rights or warrants applicable to one Common Share and the denominator of
     which shall be such current per share market price of the Common Shares;
     provided, however, that in no event shall the consideration to be paid upon
     the exercise of one Right be less than the aggregate par value of the
     shares of capital stock of the Company to be issued upon exercise of one
     Right. 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 again be adjusted to be the Purchase Price which would
     then be in effect if such record date had not been fixed.

          (d) For the purpose of any computation hereunder, the "current per
     share market price" of the Common Shares on any date shall be deemed to be
     the average of the daily closing prices per Common Share for the 30
     consecutive Trading Days (as such term is hereinafter defined) immediately
     prior to and not including such date; provided, however, that in the event
     that the current per share market price of the Common Shares is determined
     during a period following the announcement by the issuer of such Common
     Shares of (i) a dividend or distribution on such Common Shares payable in
     Common Shares or securities convertible into Common Shares, or (ii) any
     subdivision, combination or reclassification of Common Shares and prior to
     the expiration of 30 Trading Days after the ex-dividend date for such
     dividend or distribution, or the record date for such subdivision,
     combination or reclassification, then, and in each such case, the current
     per share market price shall be appropriately adjusted to reflect the
     current market price per Common Share. 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 the New York Stock Exchange or, if the Common Shares are not
     listed or admitted to trading on the New York Stock Exchange, as reported
     in the principal consolidated transaction reporting system with respect to
     securities listed on the principal national securities exchange on which
     the Common Shares are listed or admitted to trading or, if the Common
     Shares 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, Inc. Automated
     Quotations System ("Nasdaq") or such other system then in use, or, if on
     any such date the Common Shares 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 Shares selected by
     the Board of Directors of the Company. The term "Trading Day" shall mean a
     day on which the principal national securities exchange on which the Common
     Shares are listed or admitted to trading or Nasdaq, as the case may be, is
     open for the transaction of business


                                       13
<PAGE>

     or, if the Common Shares are not listed or admitted to trading on any
     national securities exchange or Nasdaq, as the case may be, a Business Day.

          (e) No adjustment in the Purchase Price shall be required unless such
     adjustment would require an increase or decrease of at least 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 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 years from the date of
     the transaction which requires such adjustment or (ii) the date of the
     expiration of the right to exercise any Rights.

          (f) If, as a result of an adjustment made pursuant to Section 11(a),
     the holder of any Right thereafter exercised shall become entitled to
     receive any shares of capital stock of the Company other than Common
     Shares, thereafter the number of such other shares so receivable upon
     exercise of any Right 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 Common Shares contained in Section 11(a) through (c),
     inclusive, and the provisions of Sections 7, 9, 10 and 13 with respect to
     the Common Shares 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 Common Shares
     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 Section 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 Common Shares (calculated to the nearest ten-thousandth of a Common
     Share) obtained by (i) multiplying (x) the number of Common Shares 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 substitution for any
     adjustment in the number of Common Shares purchasable upon the exercise of
     a Right. Each of the Rights outstanding after such adjustment of the number
     of Rights shall be exercisable for the number of Common Shares 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 the Purchase Price by the Purchase Price in effect
     immediately after adjustment of the


                                       14
<PAGE>

     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 Right Certificates have been
     issued, shall be at least 10 days later than the date of the public
     announcement. If Right 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
     Right Certificates on such record date Right 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 Right Certificates held by such
     holders prior to the date of adjustment, and upon surrender thereof, if
     required by the Company, new Right Certificates evidencing all the Rights
     to which such holders shall be entitled after such adjustment. Right
     Certificates to be so distributed shall be issued, executed and
     countersigned in the manner provided for herein and shall be registered in
     the names of the holders of record of Right 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 Common Shares issuable upon the exercise of the Rights, the
     Right Certificates theretofore and thereafter issued may continue to
     express the Purchase Price and the number of Common Shares which were
     expressed in the initial Right Certificates issued hereunder.

          (k) Before taking any action that would cause an adjustment reducing
     the Purchase Price below the par value, if any, of the Common Shares
     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
     (except as otherwise provided by any corporation law applicable to the
     Company) Common Shares 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 issuing to the holder of any Right exercised after such
     record date of the Common Shares and other capital stock or securities of
     the Company, if any, issuable upon such exercise over and above the number
     of Common Shares 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 upon the
     occurrence of the event requiring such adjustment. The Company shall
     contemporaneously provide the Rights Agent with a copy of any such
     election.

          (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 it in its sole discretion shall determine to be
     advisable in order that any consolidation or subdivision


                                       15
<PAGE>

     of the Common Shares, issuance wholly for cash of any Common Shares at less
     than the current market price, issuance wholly for cash of Common Shares or
     securities which by their terms are convertible into or exchangeable for
     Common Shares, dividends on Common Shares payable in Common Shares or
     issuance of rights, options or warrants referred to in Section 11(b),
     hereafter made by the Company to holders of Common Shares shall not be
     taxable to such shareholders.

          (n) The Company covenants and agrees that it shall not, at any time
     after the earlier of the Distribution Date or the Share Acquisition 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 or earning power
     aggregating more than 50% of the assets 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 (iv) consummate a
     share exchange with any other Person, if at the time of or immediately
     after such consolidation, merger, sale or share exchange (A) 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, (B) prior to,
     simultaneously with or immediately after such consolidation, merger, sale
     or share exchange the shareholders of the Person who constitute, 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 or (C) the form or nature of
     organization of the Principal Party would preclude or limit the
     exercisability of the Rights.

          (o) The Company covenants and agrees that, after the Distribution
     Date, it will not, except as permitted by Section 23, 24 or 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.

          Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Sections 11 and 13 hereof,
the Company shall promptly (a) prepare a certificate setting forth such
adjustment, and a brief statement of the facts accounting for such adjustment,
(b) file with the Rights Agent and with each transfer agent for the Common
Shares a copy of such certificate and (c) mail (or, if deemed appropriate by the
Board of Directors of the Company, make available at no charge) a brief summary
thereof to each holder of a Right Certificate in accordance with Section 25
hereof. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment therein contained, and shall have no duty with
respect to and shall not be deemed to have knowledge of such adjustment unless
and until it shall have received such certificate.


                                       16
<PAGE>

          Section 13. Consolidation, Merger, Share Exchange or Sale or Transfer
of Assets or Earning Power.

          (a) In the event that, following the Shares 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, or any
     Person or Persons (other than a Subsidiary of the Company in a transaction
     that complies with Section 11(o) hereof) shall consummate a share exchange
     with the Company, and, in connection with such consolidation or merger or
     share exchange, all or part of the outstanding Common Shares shall be
     changed into or exchanged for stock or other securities of any other Person
     (or the Company) 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 or earning power aggregating more than 50% of the
     assets 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, proper provision shall
     be made so that: (i) each holder of a Right (except as otherwise provided
     herein) shall thereafter have the right to receive, upon the exercise
     thereof at a price equal to the then current Purchase Price multiplied by
     the number of Common Shares for which a Right is then exercisable (or, if a
     Section 11(a)(ii) Event has occurred prior to the first occurrence of any
     of the events described in clauses (x), (y) or (z) above (a "Section 13
     Event"), the Purchase Price in effect immediately prior to the first
     occurrence of a Section 11(a)(ii) Event multiplied by the number of Common
     Shares for which a Right was exercisable immediately prior to such first
     occurrence), in accordance with the terms of this Agreement, such number of
     validly authorized and issued, fully paid, nonassessable (except as
     otherwise required by any corporation law applicable to the Principal Party
     (as such term is hereinafter defined)) and freely tradable Common Shares of
     the Principal Party, 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 Common Shares 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 shares 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),
     and dividing that product (which, following the first 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 (2) 50% of the current
     market price (determined pursuant to Section 11(d) hereof) per Common Share
     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


                                       17
<PAGE>

     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 its Common Shares) 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 Common
     Shares 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), the Person that is the issuer
          of any securities into which Common Shares of the Company are
          converted in such merger, consolidation or share exchange, and if no
          securities are so issued, (A) the Person that is the other party to
          the merger, consolidation or share exchange and that survives such
          merger or consolidation, or, if there is more than one such Person,
          the Person the Common Shares of which have the greatest aggregate
          market value of shares outstanding or (B) if the Person that is the
          other party to the merger or consolidation does not survive the merger
          or consolidation, the Person that does survive the merger or
          consolidation (including the Company if it survives); and

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

provided, however, that in any such case, (1) if the Common Shares of such
Person are not at such time and have 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
Shares of which are and have 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 Shares 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 Shares having the greatest aggregate
market value.

          (c) The Company shall not consummate any such consolidation, merger,
     share exchange, sale or transfer unless the Principal Party shall have a
     sufficient number of authorized Common Shares 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 providing that, as soon as
     practicable after the date of any consolidation, merger, share exchange or
     sale of assets mentioned in paragraph (a) of this Section 13, the Principal
     Party will


                                       18
<PAGE>

               (i) prepare and file a registration statement under the
          Securities Act of 1933, as amended (the "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 Act) until the Final Expiration
          Date; and

               (ii) 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 under the Exchange Act.

The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations, share exchanges 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).

          Section 14. Fractional Rights and Fractional Shares.

          (a) The Company shall not be required to issue fractions of Rights or
     to distribute Right Certificates which evidence fractional Rights. In lieu
     of such fractional Rights, there shall be paid to the registered holders of
     the Right Certificates with regard to which such fractional Rights would
     otherwise be issuable, an amount in cash equal to the same fraction of the
     current market value of a whole Right. For the 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 for any 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 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 of Directors of the Company. 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 of Directors
     of the Company shall be used.

          (b) The Company shall not be required to issue fractions of Common
     Shares upon exercise of the Rights or to distribute certificates which
     evidence fractional Common Shares. In lieu of fractional Common Shares,
     equal to one-half of a Common Share or less, the Company shall pay to the
     registered holders of Right 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 Common Share. Any exercise of Rights
     that would entitle the holder thereof to receive any fraction of a Common
     Share greater than


                                       19
<PAGE>

     one-half of a Common Share shall be governed by Section 7(a) hereof. For
     purposes of this Section 14(b), the current market value of a Common Share
     shall be the closing price of a Common Share (as determined pursuant to the
     second sentence of Section 11(d) hereof) for the Trading Day immediately
     prior to the date of such exercise.

          (c) The holder of a Right by the acceptance of the Right expressly
     waives his right to receive any fractional Rights or any fractional shares
     upon exercise of a Right (except as provided above).

          (d) The Rights Agent shall have no duty or obligation with respect to
     this Section 14 and any other Section of this Agreement relating to
     fractional shares unless and until it has received specific instructions
     (and sufficient cash if required) from the Company with respect to its
     duties and obligations under such Sections.

          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 Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Shares); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right 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 will be entitled to specific performance of
the obligations under, and injunctive relief against actual or threatened
violations of the obligations of any Person subject to, this Agreement.

          Section 16. Agreement of Right 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 the Common Shares;

          (b) after the Distribution Date, the Right Certificates are
     transferable only on the registry books of the Rights Agent if surrendered
     at the principal office of the Rights Agent, duly endorsed or accompanied
     by a proper instrument of transfer;

          (c) the Company and the Rights Agent may deem and treat the person in
     whose name the Right Certificate (or, prior to the Distribution Date, the
     associated Common Shares certificate) is registered as the absolute owner
     thereof and of the Rights evidenced thereby (notwithstanding any notations
     of ownership or writing on the Right Certificates or the associated Common
     Shares certificate made by anyone other than the Company or the Rights
     Agent) for all purposes whatsoever, and neither the Company nor the Rights
     Agent shall be affected by any notice to the contrary; and


                                       20
<PAGE>

          (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, decree, judgment or ruling (whether
     interlocutory or final) issued by a court of competent jurisdiction or by a
     governmental, 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 order, decree, judgment or ruling lifted or otherwise
     overturned as soon as possible.

          Section 17. Right Certificate Holder Not Deemed a Shareholder. No
holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or other distributions or be deemed for any purpose the holder of the
Common Shares or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right 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
proceedings of the Company (except as provided herein), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised 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 other disbursements incurred in the preparation, delivery,
     amendment, 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, damage, judgment, fine, penalty, claim, demand, settlement, loss
     or expense (including, without limitation, the reasonable fees and expenses
     of counsel) incurred without negligence, bad faith or willful misconduct on
     the part of the Rights Agent, for any action taken, suffered or omitted by
     the Rights Agent in connection with the acceptance, administration,
     exercise and performance of its duties under this Agreement, including the
     costs and expenses of defending against any claim of liability in the
     premises. The indemnity provided for herein shall survive the termination
     of this Agreement and the exercise or expiration of the Rights. Any
     reasonable costs and expenses incurred in enforcing this right of
     indemnification shall be paid by the Company.

          (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
     Right Certificate or certificate for the Common Shares or for other
     securities of the Company, instrument of assignment or transfer, power of
     attorney, endorsement, affidavit, letter, notice, direction, consent,


                                       21
<PAGE>

     certificate, statement or other paper or document believed by it to be
     genuine and to be signed, executed and, where necessary, verified or
     acknowledged, by the proper person or persons, or otherwise upon the advice
     of counsel as set forth in Section 20 hereof.

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

          Section 20. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations, and only the duties and obligations, expressly imposed
by this Agreement (and no implied duties and obligations) upon the following
terms and conditions, by all of which the Company and the holders of Right
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 written advice or opinion of such counsel
     shall be full and complete authorization and protection to the Rights Agent
     with respect to, and the Rights Agent shall incur no liability for or in
     respect of, any action taken, suffered 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
     be proved or established by the Company prior to taking or suffering any
     action hereunder, such fact or matter (unless other evidence in respect
     thereof be herein specifically prescribed) may


                                       22
<PAGE>

     be deemed to be conclusively proved and established by a certificate signed
     by the Chairman of the Board, the President or any Vice President and by
     the Treasurer or any Assistant Treasurer or the Secretary or any Assistant
     Secretary of the Company and delivered to the Rights Agent; and such
     certificate shall be full and complete authorization and protection to the
     Rights Agent for any action taken, suffered, or omitted in good faith by it
     under the provisions of this Agreement in reliance upon such certificate.

          (c) The Rights Agent shall be liable hereunder to the Company and any
     other Person only for its own negligence, bad faith or willful misconduct.
     In no case will the Rights Agent be liable for special, indirect, punitive,
     incidental or consequential losses or damages of any kind whatsoever
     (including without limitation lost profits), even if the Rights Agent has
     been advised of the possibility of such damages. In the absence of gross
     negligence, bad faith or willful misconduct by the Rights Agent, any
     liability of the Rights Agent under this Agreement shall be limited to the
     aggregate amount of fees paid by the Company to the Rights Agent pursuant
     to this Agreement.

          (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
     Right Certificates (except its countersignature thereof) or be required to
     verify the same, 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 liability or
     responsibility in respect of the validity of this Agreement or the
     execution and delivery hereof (except the due authorization, execution and
     delivery hereof by the Rights Agent) or in respect of the validity or
     execution of any Right 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 Right Certificate; nor
     shall it be responsible for any change in the exercisability of the Rights
     (including the Rights becoming void pursuant to Section 11(a)(ii) hereof)
     or any adjustment in the terms of the Rights (including the manner, method
     or amount thereof) provided for in Section 3, 7, 11, 13, 23 or 24, or the
     ascertaining of the existence of facts that would require any such change
     or adjustment (except with respect to the exercise of Rights evidenced by
     Right Certificates after actual notice that such change or adjustment is
     required); nor shall it by any act hereunder be deemed to make any
     representation or warranty as to the authorization or reservation of any
     Common Shares or other securities to be issued pursuant to this Agreement
     or any Right Certificate or as to whether any Common Shares or other
     securities will, when issued, be validly authorized and issued, fully paid
     and nonassessable (except as otherwise provided by any corporation law
     applicable to the Company).

          (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.


                                       23
<PAGE>

          (g) The Rights Agent is hereby authorized and directed to accept
     instructions with respect to the performance of its duties hereunder from
     any one of 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, such instructions shall be full
     authorization and protection to the Rights Agent and the Rights Agent shall
     incur no liability for or in respect of any action taken, suffered or
     omitted by it in good faith in accordance with instructions of any such
     officer or for any delay in acting while waiting for those instructions.
     The Rights Agent shall be fully authorized and protected in relying upon
     the most recent advice or instructions received from any such officer.

          (h) The Rights Agent and any shareholder, affiliate, director, officer
     or employee of the Rights Agent may buy, sell or deal in, or act as the
     transfer agent for, any of the Rights, Common Shares or other securities of
     the Company or become pecuniary 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 or any such
     shareholder, affiliate, director, officer or employee 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 or any other
     Person resulting from any such act, default, neglect or misconduct,
     provided 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 incur any financial liability in the
     performance of any of its duties hereunder or in the exercise of its rights
     if it believes that repayment of such funds or adequate indemnification
     against such risk or liability is not reasonably assured to it.

          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 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Shares by registered or certified mail, and to the holders of the
Right Certificates by first class mail. The Company may remove the Rights Agent
or any successor Rights Agent upon 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 Shares by registered or certified mail, and to the holders
of the Right 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 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 Right Certificate
(who shall, with such notice, submit his Right Certificate for inspection by the
Company), then the registered holder of any Right Certificate may apply to any
court of competent jurisdiction


                                       24
<PAGE>

for the appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be (a) a corporation
authorized to do business as a banking institution, organized and doing business
under the laws of the United States or of the State of Wisconsin, in good
standing, having an office in the State of Wisconsin (or, in the discretion of
the Board of Directors of the Company, any other state of the United States),
which is authorized under such laws to exercise corporate trust or stock
transfer powers and is subject to supervision or examination by federal or state
authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $25 million, or (b) an Affiliate of a
corporation 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 Shares, and mail a notice thereof in
writing to the registered holders of the Right 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 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 Right Certificates. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Right Certificates evidencing Rights in such form
as may be approved by its Board of Directors 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 Right Certificates made in
accordance with the provisions of this Agreement.

          Section 23. Redemption.

          (a) The Rights may be redeemed by action of the Board of Directors
     pursuant to subsection (b) of this Section 23 and shall not be redeemed in
     any other manner.

          (b) The Board of Directors of the Company may, at its option, at any
     time prior to such time as any Person becomes an Acquiring Person, redeem
     all but not less than all of the then outstanding Rights at a redemption
     price of $0.001 per Right, 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"). The redemption of the Rights by the Board of Directors
     may be made effective at such time, on such basis and with such conditions
     as the Board of Directors in its sole discretion may establish.
     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.

          (c) Immediately upon the effectiveness of the action of the Board of
     Directors of the Company ordering the redemption of the Rights pursuant to
     subsection (b) of this Section 23 and without any further action and
     without any notice, the right to exercise the


                                       25
<PAGE>

     Rights will terminate and the only right thereafter of the holders of
     Rights shall be to receive the Redemption Price. The Company shall promptly
     give public notice of any such redemption; provided, however, that the
     failure to give, or any defect in, any such notice shall not affect the
     validity of such redemption. Within 10 days after the effectiveness of the
     action of the Board of Directors ordering the redemption of the Rights
     pursuant to subsection (b) the Company shall mail a notice of redemption to
     all the holders of the then outstanding Rights at their last addresses as
     they appear 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 Shares. 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. 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 or in Section 24 hereof, and other than in connection with
     the purchase of Common Shares prior to the Distribution Date.

          Section 24. Exchange.

          (a) The Board of Directors of the Company 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 11(a)(ii)
     hereof) for Common Shares at an exchange ratio of one Common Share 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 of Directors shall not be empowered to effect such
     exchange at any time after any Person (other than the Company, any
     Subsidiary of the Company, any employee benefit plan of the Company or any
     such Subsidiary, any entity holding Common Shares for or pursuant to the
     terms of any such plan, or any trustee, administrator or fiduciary of such
     a plan), together with all Affiliates and Associates of such Person,
     becomes the Beneficial Owner of 50% or more of the Common Shares then
     outstanding.

          (b) Immediately upon the action of the Board of Directors of the
     Company 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 Common Shares
     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 Shares 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


                                       26
<PAGE>

     rata based on the number of Rights (other than Rights which have become
     void pursuant to the provisions of Section 11(a)(ii) hereof) held by each
     holder of Rights.

          (c) In any exchange pursuant to this Section 24, the Company, at its
     option, may substitute common stock equivalents (as such term is defined in
     Section 11(a)(iii) hereof) for some or all of the Common Shares
     exchangeable for Rights.

          (d) In the event that there shall not be sufficient Common Shares or
     common stock equivalents 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 Common Shares or common stock equivalents
     for issuance upon exchange of the Rights.

          (e) The Company shall not be required to issue fractions of Common
     Shares or to distribute certificates which evidence fractional Common
     Shares. In lieu of such fractional Common Shares, the Company shall pay to
     the registered holders of the Right Certificates with regard to which such
     fractional Common Shares would otherwise be issued an amount in cash equal
     to the same fraction of the current market value of a whole Common Share.
     For the purposes of this paragraph (e), the current market value of a whole
     Common Share shall be the closing price of a Common Share (as determined
     pursuant to the second sentence of Section 11(d) 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, after the Distribution Date,
     (i) to pay any dividend payable in stock of any class to the holders of
     Common Shares or to make any other distribution to the holders of Common
     Shares (other than a regular quarterly cash dividend), (ii) to offer to the
     holders of Common Shares rights or warrants to subscribe for or to purchase
     any additional Common Shares or shares of stock of any class or any other
     securities, rights or options, (iii) to effect any reclassification of
     Common Shares (other than a reclassification involving only the subdivision
     of outstanding Common Shares), (iv) to effect any consolidation or merger
     into or with (other than a merger of a Subsidiary into or with the
     Company), to effect any share exchange with 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 or more transactions, of 50% or more of the
     assets or earning power of the Company and its Subsidiaries (taken as a
     whole) to, any other Person, 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 Right Certificate, 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, or distribution of rights or
     warrants, or the date on which such reclassification, consolidation,
     merger, share exchange, sale, transfer, liquidation, dissolution, or
     winding up is to take place and the date of participation therein by the
     holders of the Common Shares 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 10 days prior to the record date for determining
     holders of Common Shares for purposes of such action, and in the case of
     any such other action, at


                                       27
<PAGE>

     least 10 days prior to the date of the taking of such proposed action or
     the date of participation therein by the holders of the Common Shares,
     whichever shall be the earlier.

          (b) In case any Section 11(a)(ii) Event or Section 13 Event shall
     occur, then, in any case, the Company shall as soon as practicable
     thereafter give to each holder of a Right Certificate, in accordance with
     Section 26 hereof, a notice of the occurrence of such event, which notice
     shall include a brief summary of the Section 11(a)(ii) Event or Section 13
     Event, as the case may be, and the consequences thereof to holders of
     Rights.

          (c) In case of an adjustment to the number of Common Shares subject to
     receipt upon exercise of the Rights shall occur pursuant to Section 7(a) of
     this Agreement, then the Company shall give to (i) the Rights Agent, in
     accordance with Section 26 hereof, notice of such adjustment as soon as
     practicable and (ii) each holder of a Right Certificate, in accordance with
     Section 26 hereof, notice of such adjustment no later than the earlier of
     the payment date of the Company's next regular quarterly cash dividend on
     Common Shares payable after the amendment date, or 100 days after the
     amendment date.

          Section 26. Notices.

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

                           Fresh Brands, Inc.
                           2215 Union Avenue
                           Sheboygan, Wisconsin 53081
                           Attention:  Secretary

          (b) Subject to the provisions of Section 21 hereof, any notice or
     demand authorized by this Agreement to be given or made by the Company or
     by the holder of any Right 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 with the Company) as
     follows:

                           Firstar Bank, N.A.
                           1555 North Rivercenter Drive
                           Suite 301
                           Milwaukee, Wisconsin 53212
                           Attention:  Corporate Trust Department

          (c) Notices or demands authorized by this Agreement to be given or
     made by the Company or the Rights Agent to the holder of any Right
     Certificate 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.


                                       28
<PAGE>

          Section 27. Supplements and Amendments. Prior to the Distribution Date
and subject to the penultimate sentence of this Section 27, the Company may 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 certificates
representing Common Shares. Without limiting the foregoing, the Company may at
any time prior to such time as any Person becomes an Acquiring Person amend this
Agreement to lower the thresholds set forth in Sections 1(a) and 3(a) hereof
from 20% to not less than 10%, with appropriate exceptions for Persons then
beneficially owning Common Shares of the Company constituting a percentage of
the number of Common Shares then outstanding equal to or in excess of the new
threshold. From and after the Distribution Date and subject to the penultimate
sentence of this Section 27, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend this Agreement without the approval of
any holders of Right Certificates in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provision herein, (iii) to shorten or lengthen any
time period hereunder, or (iv) to 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 Right Certificates (other
than an Acquiring Person or an Affiliate or Associate of an Acquiring Person);
provided, however, that from and after the Distribution Date this Agreement may
not be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed at such
time as the Rights are not then redeemable, or (B) any other time period unless
such lengthening is for the purpose of protecting, enhancing or clarifying the
rights of, and/or the benefits to, the holders of Rights. 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 contained in this Agreement to the contrary, the Rights Agent may, but
shall not be obligated to, enter into any supplement or amendment that affects
the Rights Agent's own rights, duties, obligations or immunities under this
Agreement. Notwithstanding anything contained in this Agreement to the contrary,
no supplement or amendment shall be made which reduces the then effective
Redemption Price or moves to an earlier date the then effective Final Expiration
Date. Prior to the Distribution Date, the interests of the holders of Rights
shall be deemed coincident with the interests of the holders of Common Shares.

          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. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company,
the Rights Agent and the registered holders of the Right Certificates (and,
prior to the Distribution Date, the Common Shares) 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 Right Certificates (and, prior to the Distribution Date, the
Common Shares).

          Section 30. 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


                                       29
<PAGE>

Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated.

          Section 31. Governing Law. This Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of Wisconsin 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
performed entirely within such State.

          Section 32. 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 33. 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.

          Section 34. Determinations and Actions by the Board of Directors. For
all purposes of this Agreement, any calculation of the number of Common Shares
outstanding at any particular time, including for purposes of determining the
particular percentage of such outstanding Common Shares 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 of Directors of the Company 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 (a) interpret the provisions of this Agreement, and (b) 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 and any determination as to whether actions or any Person
shall be such as to cause such Person to beneficially own shares held by another
Person). All such actions, calculations, interpretations and determinations
(including, for purposes of clause (ii) below, all omissions with respect to the
foregoing) which are done or made by the Board of the Company in good faith (the
Rights Agent may assume the Board acted in good faith), shall (i) be final,
conclusive and binding on the Company, the Rights Agent, the holders of the
Rights and all other parties, and (ii) not subject the Board of the Company to
any liability to the holders of the Rights.


                                       30
<PAGE>

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

                                        FRESH BRANDS, INC.
Attest:

By:  /s/ Armand C. Go                   By:  /s/ Elwood F. Winn
   ---------------------------------       ---------------------------------
     Armand C. Go                            Elwood F. Winn
     Vice President, Chief Financial         President and Chief Executive
     Officer, Treasurer and Secretary        Officer


                                        FIRSTAR BANK, N.A.
Attest:

By: /s/ Toula Akladios                  By:  /s/ Barbara Bahr
   ---------------------------------       ---------------------------------
Name: Toula Akladios                         Barbara Bahr
     -------------------------------
Title:  Vice President                  Title: Trust Officer
      ------------------------------       ---------------------------------


<PAGE>
                                                                       Exhibit A
                                                                       ---------
                           [Form of Right Certificate]

Certificate No. R-                                      _________ Rights

                    NOT EXERCISABLE AFTER NOVEMBER 9, 2011 (SUBJECT TO
                    EXTENSION) OR EARLIER IF REDEMPTION OR EXCHANGE
                    OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT
                    $.001 PER RIGHT AND TO EXCHANGE ON THE TERMS SET
                    FORTH IN THE RIGHTS AGREEMENT.

                                Right Certificate

                               FRESH BRANDS, INC.

          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 October 12, 2001, and as such agreement may be amended,
(the "Rights Agreement"), between Fresh Brands, Inc., a Wisconsin corporation
(the "Company"), and Firstar Bank, N.A., Milwaukee, Wisconsin, a National
Banking Association (the "Rights Agent"), to purchase from the Company at any
time after the Distribution Date (as such term is defined in the Rights
Agreement) and prior to 5:00 P.M., Milwaukee, Wisconsin time, on November 9,
2011 at the principal office of the Rights Agent, or at the office of its
successor as Rights Agent, one fully paid nonassessable (except as otherwise
provided by any corporation law applicable to the Company) share of common
stock, par value $.05 ("Common Shares"), of the Company, at a purchase price of
$50.00 per Common Share (the "Purchase Price"), upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Right Certificate (and the number of
Common Shares which may be purchased upon exercise hereof) set forth above, and
the Purchase Price set forth above, are the number and Purchase Price as of
November 9, 2001, based on the Common Shares as constituted at such date. As
provided in the Rights Agreement, the Purchase Price and the number of Common
Shares which may be purchased upon the exercise of the Rights evidenced by this
Right Certificate are subject to modification and adjustment upon the happening
of certain events.

          This Right 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 Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices of the
Company and the above-mentioned offices of the Rights Agent.

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


                                      A-1
<PAGE>
          Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate (i) may be redeemed by the Company at a redemption
price of $.001 per Right or (ii) may be exchanged in whole or in part for Common
Shares.

          The Board of Directors of the Company may, at its option, at any time
after any Person becomes an Acquiring Person, but prior to such Person's
acquisition of 50% or more of the outstanding Common Shares, exchange the Rights
evidenced by the Certificate for Common Shares, at an exchange ratio of one
Common Share per Right, subject to adjustment, as provided in the Rights
Agreement.

          No fractional Common Shares will be issued upon the exercise of any
Right or Rights evidenced hereby, but in lieu thereof a cash payment will be
made, as provided in the Rights Agreement. No Rights may be exercised that would
entitle the holder to any fraction of a Common Share greater than one-half of a
Common Share unless concurrently therewith such holder purchases an additional
fraction of a Common Share which, when added to the number of Common Shares to
be received upon such exercise, equals an integral number of Common Shares, as
provided in the Rights Agreement.

          No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Common Shares
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 or withhold consent to 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, distributions or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights Agreement.

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

          WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal. Dated as of ___________, 20__.

                                        FRESH BRANDS, INC.
ATTEST:

                                        By:
------------------------------------       ---------------------------------
                                        Name:_______________________________
Countersigned:                          Title:________________________________

FIRSTAR BANK, N.A.

By:---------------------------------
Name:_______________________________
Title:______________________________


                                      A-2
<PAGE>
                   [Form of Reverse Side of Right Certificate]

                               FORM OF ASSIGNMENT
                               ------------------

                (To be executed by the registered holder if such
               holder desires to transfer the Right Certificate.)

          FOR VALUE RECEIVED _____________________________ hereby sells, assigns
     and transfers unto ______________________________________________________
                        (Please print name and address of transferee)

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

Dated:  ________________________, 20__

                                        ---------------------------------------
                                        Signature

Signature Guaranteed:

          The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).

                                        ---------------------------------------
                                        Signature


--------------------------------------------------------------------------------



                                      A-3
<PAGE>

            [Form of Reverse Side of Right Certificate -- continued]

                          FORM OF ELECTION TO PURCHASE
                          ----------------------------

                      (To be executed if holder desires to
                        exercise the Right Certificate.)

To Fresh Brands, Inc.

          The undersigned hereby irrevocably elects to exercise ________________
Rights represented by this Right Certificate to purchase the Common Shares
issuable upon the exercise of such Rights and requests that certificates for
such Common Shares be issued in the name of:

Please insert social security
or other identifying number

--------------------------------------------------------------------------------
                         (Please print name and address)

--------------------------------------------------------------------------------

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

Please insert social security
or other identifying number

--------------------------------------------------------------------------------
                         (Please print name and address)
--------------------------------------------------------------------------------

Dated  __________________, 20__


                                        ----------------------------------------
                                        Signature

Signature Guaranteed:

          Signatures must be guaranteed by a member firm of a registered
national securities exchange, a member of the National Association of Securities
Dealers, Inc., or a commercial bank or trust company having an office or
correspondent in the United States.


                                      A-4
<PAGE>

            [Form of Reverse Side of Right Certificate -- continued]

--------------------------------------------------------------------------------

          The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).


                                        ----------------------------------------
                                        Signature


--------------------------------------------------------------------------------

                                     NOTICE
                                     ------


          The signature in the foregoing Forms of Assignment and Election must
conform to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.

          In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of
the Rights evidenced by this Right Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.



                                      A-5
<PAGE>
                                                                       Exhibit B
                                                                       ---------

                               FRESH BRANDS, INC.

                   SUMMARY OF RIGHTS TO PURCHASE COMMON SHARES

          On October 11, 2001, the Board of Directors of Fresh Brands, Inc. (the
"Company") declared a dividend of one common share purchase right (a "Right")
for each outstanding share of common stock, par value $.05 (the "Common
Shares"), of the Company. The dividend is payable on November 23, 2001 to the
shareholders of record on November 9, 2001 (the "Record Date"). Each Right
entitles the registered holder to purchase from the Company one Common Share, at
a price of $50.00 per Common Share, subject to adjustment (the "Purchase
Price"). The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and Firstar Bank, N.A.,
Milwaukee, Wisconsin, as Rights Agent (the "Rights Agent").

          Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (other
than the Company, a subsidiary of the Company or an employee benefit plan of the
Company or a subsidiary) (an "Acquiring Person") has acquired beneficial
ownership of 20% or more of the outstanding Common Shares (the "Shares
Acquisition Date") or (ii) 10 business days (or such later date as may be
determined by action of the Company's Board of Directors prior to such time as
any person becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by a person or
group (other than the Company, a subsidiary of the Company or an employee
benefit plan of the Company or a subsidiary) of 20% or more of such outstanding
Common Shares (the earlier of such dates being called the "Distribution Date"),
the Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, by such Common Share
certificate.

          The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Share certificates issued after the Record Date, upon transfer or new
issuance of Common Shares, will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any certificates for
Common Shares, outstanding as of the Record Date, even without such notation,
will also constitute the transfer of the Rights associated with the Common
Shares represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.

          The Rights are not exercisable until the Distribution Date. The Rights
will expire on November 9, 2011, unless the Rights are earlier redeemed or
exchanged by the Company, or the Rights Agreement is amended, in each case as
described below.


                                      B-1
<PAGE>
          The Purchase Price payable, and the number of Common Shares 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 Common
Shares, (ii) upon the grant to holders of the Common Shares of certain rights or
warrants to subscribe for or purchase Common Shares at a price, or securities
convertible into Common Shares with a conversion price, less than the then
current market price of the Common Shares or (iii) upon the distribution to
holders of the Common Shares of evidences of indebtedness or assets (excluding
regular quarterly cash dividends or dividends payable in Common Shares) or of
subscription rights or warrants (other than those referred to above).

          The number of outstanding Rights and the number of Common Shares
issuable upon exercise of each Right are also subject to adjustment in the event
of a stock split of the Common Shares or a stock dividend on the Common Shares
payable in Common Shares or subdivisions, consolidations or combinations of the
Common Shares occurring, in any such case, prior to the Distribution Date.

          In the event that any person becomes an Acquiring Person (a "Flip-In
Event"), holders of Rights will thereafter generally have the right to receive
upon exercise that number of Common Shares (or, in certain circumstances cash,
property or other securities of the Company or a reduction in the Purchase
Price) having a market value of two times the then current Purchase Price.
Notwithstanding any of the foregoing, following the occurrence of a Flip-In
Event all Rights that are, or (under certain circumstances specified in the
Rights Agreement) were, or subsequently become beneficially owned by an
Acquiring Person, related persons and transferees will be null and void.

          In the event that, at any time following the Shares Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction or (ii) 50% or more of its consolidated assets or earning power are
sold (the events described in clauses (i) and (ii) are herein referred to as
"Flip-Over Events"), proper provision will be made so that holders of Rights
(except as otherwise provided in the Rights Agreement) will thereafter have the
right to receive, upon the exercise thereof at the then current Purchase Price,
that number of shares of common stock of the acquiring company which at the time
of such transaction will have a market value of two times the then current
Purchase Price.

          With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least one
percent in such Purchase Price. No fractional Common Shares will be issued. In
lieu of fractional Common Shares equal to one-half of a Common Share or less, an
adjustment in cash will be made based on the market price of the Common Shares
on the last trading day prior to the date of exercise. No Rights may be
exercised that would entitle the holder thereof to any fractional Common Share
greater than one-half of a Common Share unless concurrently therewith such
holder purchases an additional fraction of a Common Share which, when added to
the number of Common Shares to be received upon such exercise, equals an
integral number of Common Shares.

          The Purchase Price is payable by certified check, cashier's check,
bank draft or money order or, if so provided by the Company, the Purchase Price
following the occurrence of a


                                      B-2
<PAGE>

Flip-In Event and until the first occurrence of a Flip-Over Event may be paid in
Common Shares having an equivalent value.

          At any time after a person becomes an Acquiring Person and prior to
the acquisition by any Acquiring Person of 50% or more of the outstanding Common
Shares, the Board of Directors of the Company may exchange the Rights (other
than Rights owned by any Acquiring Person which have become void), in whole or
in part, at an exchange ratio of one Common Share per Right (subject to
adjustment).

          At any time prior to a person becoming an Acquiring Person, the Board
of Directors of the Company may redeem the Rights in whole, but not in part, at
a price of $.001 per Right (the "Redemption Price"). The redemption of the
Rights may be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
Immediately upon any redemption of the Rights, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.

          Other than provisions relating to certain principal economic terms of
the Rights, the terms of the Rights may be amended by the Board of Directors of
the Company without the consent of the holders of the Rights, including an
amendment to lower the threshold for exercisability of the Rights from 20% to
not less than 10%, with appropriate exceptions for any person or group then
beneficially owning a percentage of Common Shares in excess of 10% of the number
of Common Shares then outstanding equal to or in excess of the new threshold,
except that from and after the Distribution Date no such amendment may adversely
affect the interests of the holders of the Rights. The Rights may also be
amended to extend the expiration date thereof.

          Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.

          A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A filed
with respect to the Rights. A copy of the Rights Agreement is available free of
charge from the Company. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to the Rights
Agreement, which is hereby incorporated herein by reference.


                                      B-3