EXHIBIT 4.1

                           
                           MAGNUM HUNTER RESOURCES, INC.


                                       and


                         SECURITIES TRANSFER CORPORATION
                                  DALLAS, TEXAS
                                  Rights Agent



                                RIGHTS AGREEMENT

                           Dated as of January 6, 1998







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                                TABLE OF CONTENTS

<S>               <C>                                                                                          <C>
                                                                                                               Page
                                    


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

Section 2.        Appointment of Rights Agent.....................................................................5

Section 3.        Issue of Rights and Right Certificates..........................................................5

Section 4.        Form of Right Certificates......................................................................7

Section 5.        Execution, Countersignature and Registration....................................................7

Section 6.        Transfer, Split-up, Combination and Exchange of Right Certificates; Mutilated,
                    Destroyed, Lost or Stolen Right Certificates..................................................8

Section 7.        Exercise of Rights; Expiration Date of Rights...................................................9

Section 8.        Cancellation and Destruction of Right Certificates.............................................10

Section 9.        Reservation and Availability of Capital Stock..................................................11

Section 10.       Preferred Shares Record Date...................................................................12

Section 11.       Adjustment of Purchase Price, Number of Shares or Number of Rights.............................12

Section 12.       Certificate of Adjustment......................................................................19

Section 13.       Consolidation, Merger, or Sale or Transfer of Assets or Earning Power..........................19

Section 14.       Fractional Rights and Fractional Shares........................................................21

Section 15.       Rights of Action...............................................................................22

Section 16.       Agreement of Right Holders.....................................................................22

Section 17.       Right Certificate Holder Not Deemed a Stockholder..............................................23

Section 18.       Concerning the Rights Agent....................................................................23

Section 19.       Merger or Consolidation or Change of Name of Rights Agent......................................23

Section 20.       Duties of Rights Agent.........................................................................24

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Section 21.       Change of Rights Agent.........................................................................26

Section 22.       Issuance of New Right Certificates and Additional Rights.......................................27

Section 23.       Redemption.....................................................................................27

Section 24.       Exchange.......................................................................................28

Section 25.       Notice of Certain Events.......................................................................29

Section 26.       Notices........................................................................................30

Section 27.       Supplements and Amendments.....................................................................31

Section 28.       Successors.....................................................................................31

Section 29.       Benefits of this Agreement.....................................................................32

Section 30.       Severability...................................................................................32

Section 31.       Governing Law..................................................................................32

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

Section 33.       Descriptive Headings...........................................................................32

Signatures.......................................................................................................32



Exhibit A -       Form of Certificate of Designations of Magnum Hunter Resources, Inc.

Exhibit B -       Form of Rights Certificate

Exhibit C -       Summary of Rights to Purchase Preferred Shares

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                                    AGREEMENT

         This AGREEMENT,  dated as of January 6,1998 (the "Agreement"),  between
MAGNUM  HUNTER  RESOURCES,  INC.,  a Nevada  corporation  (the  "Company"),  and
SECURITIES TRANSFER CORPORATION, as Rights Agent (the "Rights Agent"),

                              W I T N E S S E T H:

         WHEREAS,  the Board of  Directors  of the  Company has  authorized  and
declared a dividend of one Right (as such term is hereinafter  defined) for each
share of Common  Stock,  par value $.002 per share,  of the Company (the "Common
Stock")  outstanding  at the  close of  business  (as such  term is  hereinafter
defined)  on January  20,  1998 (the  "Record  Date"),  and has  authorized  the
issuance of one Right (as such number may hereafter be adjusted  pursuant to the
provisions  of this  Agreement)  with respect to each share of Common Stock 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);  provided,  however,  that Rights may be issued
with respect to shares of Common Stock that shall become  outstanding  after the
Distribution  Date and prior to the earlier of the Redemption Date and the Final
Expiration  Date  in  accordance  with  the  provisions  of  Section  22 of this
Agreement.  Each Right  shall  initially  represent  the right to  purchase  one
one-hundredth of a share of 1998 Series A Junior Participating  Preferred Stock,
par value $.001 per share, of the Company (the "Preferred  Shares"),  having the
powers,  rights and  preferences  set forth in the  Certificate of  Designations
attached to this Agreement as Exhibit A;

         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:

         "Acquiring  Person" shall mean any Person (as such term is  hereinafter
defined) who or which,  together with all  Affiliates  and  Associates  (as such
terms are hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 15 percent or more of the Common Shares (as
such term is hereinafter defined) of the Company then outstanding, but shall not
include the Company, any Subsidiary (as such term is hereinafter defined) of the
Company,  any  employee  benefit  plan of the Company or any  Subsidiary  of the
Company,  or any entity  holding Common Shares of the Company for or pursuant to
the terms of any such  plan.  Notwithstanding  the  foregoing,  no Person  shall
become an "Acquiring Person" as the result of an acquisition of Common Shares of
the  Company  by the  Company  which,  by  reducing  the  number of such  shares
outstanding,  increases the proportionate number of shares beneficially owned by
such  Person to 15  percent  or more of the Common  Shares of the  Company  then
outstanding;  provided,  however,  that if a Person shall become the  Beneficial
Owner of 15 percent or more of the Common Shares of the Company then outstanding
by  reason of share  purchases  by the  Company  and  shall,  after  such  share
purchases by the Company,  become the Beneficial Owner of any additional  Common
Shares of the Company, then such Person shall be deemed to be an

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"Acquiring Person."  Notwithstanding the foregoing, if the Board of Directors of
the  Company,  within 10 days  after the first date on which the  Company  shall
become aware that any Person,  together with all  Affiliates  and  Associates of
such Person,  is the  Beneficial  Owner of shares of Common Stock of the Company
such that such  person (but for this  sentence)  would be an  Acquiring  Person,
determines in good faith (but only if at the time of such  determination  by the
Board  of  Directors  there  are then in  office  not less  than a  majority  of
directors  (and in no event not less than three  directors)  who are  Continuing
Directors  then in office)  that such  Person  has  inadvertently  exceeded  the
thresholds  set forth in this  definition of Acquiring  Person,  and such Person
divests as promptly as  practicable a sufficient  number of Common Shares of the
Company so that such Person would no longer be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this definition,  then such Person shall
not be deemed to be an "Acquiring Person" for any purposes of this Agreement.

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

         "Affiliate"  and  "Associate,"  when used with reference to any Person,
shall have the respective  meanings  ascribed to such terms in Rule 12b-2 of the
General  Rules  and  Regulations  under  the  Exchange  Act  (as  such  term  is
hereinafter defined), as in effect on the date of this Agreement.

         A Person shall be deemed the "Beneficial Owner" of, and shall be deemed
to "beneficially  own," and shall be deemed to have  "Beneficial  Ownership" of,
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 the 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  promulgated
under 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,

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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 acquiring, holding, voting (except to
the extent  contemplated by the proviso in clause (ii)(B) of this definition) 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 own beneficially hereunder.

         "Business Day" shall mean any day other than a Saturday,  a Sunday or a
day on which banking  institutions in the Borough of Manhattan,  The City of New
York are authorized or obligated by law or executive order to close.

         "Certificate   of   Designations"   shall  mean  the   Certificate   of
Designations  of Series A Junior  Participating  Preferred  Stock of the Company
setting forth the powers, preferences,  rights, qualifications,  limitations and
restrictions  of such series of Preferred  Stock of the  Company,  a copy of the
form of which is attached to this Agreement as Exhibit A.

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

         "Common  Shares" when used with reference to the Company shall mean the
shares of Common Stock of the Company.  "Common Shares" when used with reference
to any Person  other than the Company  shall mean the  capital  stock (or 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.

         "Common share  equivalents" shall have the meaning set forth in Section
11(a)(iii) hereof.

         "Common  Stock"  shall have the meaning  set forth in the  introductory
paragraph of this Agreement.

         "Continuing  Director"  shall mean any member of the Board of Directors
of the  Company,  while such person is a member of the Board of Directors of the
Company,  who is not an  Acquiring  Person or an  Affiliate  or Associate of any
Acquiring  Person,  or a representative  or nominee of an Acquiring Person or of
any such Affiliate or Associate, and who either (i) was a member of the Board of
Directors of the Company  prior to the time that any Person  became an Acquiring
Person or (ii)  subsequently  became a member of the Board of  Directors  of the
Company, and whose nomination for election or election to the Board of Directors
of the Company  was  recommended  or  approved  by a majority of the  Continuing
Directors then on the Board of Directors of the Company.


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

         "Equivalent  preferred  shares"  shall  have the  meaning  set forth in
Section 11(b) hereof.

         "Exchange  Act" shall mean the  Securities  Exchange Act of 1934, as in
effect on the date in question, unless otherwise specifically provided.

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

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

         "Flip-In Event"  shall  have the meaning set forth in Section 11(a)(ii)
hereof.

         "Flip-In  Trigger  Date"  shall have the  meaning  set forth in Section
11(a)(iii) hereof.

         "Flip-Over Event"  shall have the meaning set  forth  in  Section 13(a)
hereof.

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

         "Preferred Shares" shall have the meaning set forth in the introductory
paragraph of this Agreement. Any reference in this Agreement to Preferred Shares
shall be deemed to include any authorized  fraction of a Preferred Share, unless
the context otherwise requires.

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

         "Purchase Price" with respect to each Right shall mean $35.00,  as such
amount  may from  time to time be  adjusted  as  provided  herein,  and shall be
payable in lawful money of the United States of America.  All references  herein
to the Purchase  Price shall mean the Purchase Price as in effect at the time in
question.

         "Record  Date"  shall have the  meaning  set forth in the  introductory
paragraph of this Agreement.

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

         "Redemption Price" shall  have  the  meaning set forth  in  Section  23
hereof.

         "Right  Certificate"  shall mean a  certificate  evidencing  a Right in
substantially the form attached to this Agreement as Exhibit B.

         "Rights" shall mean the rights to purchase  Preferred  Shares (or other
securities) as provided in this Agreement.


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         "Securities Act" shall mean the Securities Act of 1933, as in effect on
the date in question, unless otherwise specifically provided.

         "Shares   Acquisition  Date"  shall  mean  the  first  date  of  public
announcement by the Company or an Acquiring  Person that an Acquiring Person has
become such.

         "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.

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

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

         Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, shall, prior to the Distribution Date, also
be the holders of the Common 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.

         Section 3.        Issue of Rights and Right Certificates.

         (a) One Right shall be associated with each Common Share outstanding on
the Record Date,  each  additional  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, and each additional  Common Share
with  which  Rights  are  issued  after the  Distribution  Date and prior to the
earlier of the  Redemption  Date and the Final  Expiration  Date as  provided in
Section 22 hereof; provided,  however, that, if the number of outstanding Rights
are combined into a smaller number of outstanding  Rights pursuant to Section 11
hereof,  the appropriate  fractional Right  determined  pursuant to such Section
shall thereafter be associated with each such Common Share.

         (b) Until the earlier of (i) the tenth day after the Shares Acquisition
Date and (ii) the tenth Business Day (or such later date as may be determined by
action of the Board of Directors of the Company prior to such time as any Person
becomes an Acquiring  Person) after the date of the  commencement  by any Person
(other than the Company,  any  Subsidiary of the Company,  any employee  benefit
plan of the Company or any  Subsidiary  of the  Company,  or any entity  holding
Common  Shares of the Company for or pursuant to the terms of any such plan) 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 any Subsidiary of the Company, or any entity holding Common Shares of
the Company for or pursuant to the terms of any such 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 15 percent or more of the then
outstanding  Common Shares  (including  any such date which is after the date of
this  Agreement  and prior to the  issuance of the  Rights;  the earlier of such
dates being herein referred to as the

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"Distribution  Date"),  (x)  the  Rights  will  be  evidenced  (subject  to  the
provisions  of Section  3(c)  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  Rights,  including  the  right  to  receive  Right  Certificates,  will  be
transferable  only in connection with the transfer of Common Shares.  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  evidencing one whole Right for each
Common  Share (or for the number of Common  Shares with which one whole Right is
then  associated  if the number of Rights per Common  Share held by such  record
holder has been  adjusted  in  accordance  with the  provision  in Section  3(a)
hereof) so held. If the number of Rights  associated  with each Common Share has
been adjusted in accordance with the proviso in Section 3(a) hereof, at the time
of  distribution of the Right  Certificates,  the Company may make any necessary
and appropriate  rounding  adjustments so that Right  Certificates  representing
only whole  numbers of Rights  are  distributed  and cash is paid in lieu of any
fractional  Right in  accordance  with  Section 14  hereof.  As of and after the
Distribution   Date,  the  Rights  will  be  evidenced   solely  by  such  Right
Certificates.

         (c) On the  Record  Date,  or as soon as  practicable  thereafter,  the
Company will send a copy of a Summary of Rights to Purchase Preferred Shares, in
substantially  the form attached to this Agreement as Exhibit C (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 any certificate for
Common  Shares  outstanding  as of the Record  Date,  until the  earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date, the Rights
will be evidenced by such  certificates  registered  in the names of the holders
thereof  together with a copy of the Summary of Rights attached  thereto.  Until
the  earliest  of the  Distribution  Date,  the  Redemption  Date and the  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.

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

         This  certificate  also  evidences  and entitles  the holder  hereof to
         certain rights as set forth in a Rights  Agreement  dated as of January
         6,  1998,  as it  may  be  amended  from  time  to  time  (the  "Rights
         Agreement"),  between  Magnum  Hunter  Resources,  Inc. and  Securities
         Transfer  Corporation,  as Rights Agent,  the terms of which are hereby
         incorporated  herein by reference and a copy of which is on file at the
         principal  executive  offices of Magnum Hunter  Resources,  Inc.  Under
         certain  circumstances,  as set  forth in the  Rights  Agreement,  such
         Rights will be evidenced by separate certificates and will no longer be

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         evidenced by this certificate.  Magnum Hunter Resources, 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,  as set forth in the Rights  Agreement,  Rights
         beneficially  owned  by an  Acquiring  Person  or their  Affiliates  or
         Associates  (as such terms are defined in the Rights  Agreement) and by
         any   subsequent   holder  of  such   Rights  are  null  and  void  and
         nontransferable.

With respect to such  certificates  containing the foregoing  legend,  until the
earliest of the Distribution  Date, the Redemption Date and the Final Expiration
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  canceled 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
form of election to purchase and form of assignment to be printed on the reverse
side thereof) shall be in  substantially  the form attached to this Agreement as
Exhibit B and may have such  marks of  identification  or  designation  and such
legends,  summaries  or  endorsements  printed  thereon as the  Company may deem
appropriate and as are not  inconsistent  with the provisions of this Agreement,
or as may be  required  to comply  with any  applicable  law or with any rule or
regulation  made  pursuant  thereto  or  with  any  rule  or  regulation  of any
securities  exchange  on which the  Rights may from time to time be listed or of
any automated  quotations system of a national  securities  association on which
the  Rights  may from time to time be  registered  or  quoted,  or to conform to
usage.  Subject to the provisions of Section 22 hereof, the Right  Certificates,
whenever  issued,  on their face shall  entitle the holders  thereof to purchase
such number of one  one-hundredths  of a  Preferred  Share as shall be set forth
therein for the  Purchase  Price per one  one-hundredth  of a  Preferred  Share,
subject to adjustment from time to time as herein provided.

         Section 5.        Execution, Countersignature and Registration.

         (a) The Right  Certificates  shall be executed on behalf of the Company
by its Chairman of the Board, its President, its Chief Executive Officer, or any
of its Vice  Presidents,  or its  Treasurer,  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
countersigned  manually or by facsimile  signature by the Rights Agent and shall
not be valid or obligatory  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 an 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 person who signed
such Right Certificates had not ceased to be such

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an 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  Agreement any such
person was not such an officer.

         (b)  Following  the  Distribution  Date,  the Rights Agent will keep or
cause to be kept, at its principal  office,  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,  the certificate
number  of each of the  Right  Certificates  and the  date 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 Sections  7(e) and 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 and the Final
Expiration  Date,  any  Right  Certificate  or  Right  Certificates  (except  as
otherwise provided herein,  including,  without  limitation,  Right Certificates
representing Rights that have become null and void and nontransferable  pursuant
to  Section  7(e)  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  representing,  in the  aggregate,  the same
number of Rights as the Right Certificate or Right Certificates surrendered then
represented.  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 or offices of the Rights Agent  designated  for such  purpose;
provided,  however,  that  neither  the Rights  Agent nor the  Company  shall be
obligated  to take any action  whatsoever  with  respect to the  transfer of any
Right  Certificate  surrendered  for transfer until the registered  holder shall
have completed and signed the  certification  of status contained in the form of
assignment on the reverse side of such Right Certificate and shall have provided
such  additional  evidence of the  identity of the  Beneficial  Owner (or former
Beneficial  Owner) or  Affiliates  or  Associates  thereof as the Company  shall
reasonably request.  Thereupon the Rights Agent shall,  subject to Sections 7(e)
and 14 hereof,  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.

         (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  a  new  Right
Certificate of like tenor and deliver

                                        8

<PAGE>



such new Right  Certificate  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; Expiration Date of Rights.

         (a)  Subject to Section  7(e) hereof and except as  otherwise  provided
herein  (including  Section 24 hereof),  each Right shall entitle the registered
holder thereof,  upon exercise thereof as provided  herein,  to purchase for the
Purchase Price, at any time after the  Distribution  Date and at or prior to the
earliest of (i) the close of business on January 20, 2008 (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,  one  one-hundredth  of a Preferred
Share,  subject to adjustment  from time to time as provided in Section 11 or 13
hereof.

         (b) 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 or offices of the
Rights Agent designated for such purpose,  together with payment of the Purchase
Price for each one one-hundredth of a Preferred Share as to which the Rights are
exercised,  at or prior to the earliest of (i) the Final  Expiration  Date, (ii)
the  Redemption  Date and (iii) the time at which such Rights are  exchanged  as
provided in Section 24 hereof.

         (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 Preferred Shares (or other  securities) to
be purchased 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, in lawful money of the United States of America, in cash or by certified
check,  cashier's check or money order payable to the order of the Company,  the
Rights  Agent  shall  thereupon  (i) either (A)  promptly  requisition  from any
transfer agent of the Preferred  Shares (or make available,  if the Rights Agent
is a transfer  agent for such shares)  certificates  for the number of Preferred
Shares to be  purchased,  and the  Company  hereby  irrevocably  authorizes  its
transfer  agent to comply with all such  requests,  or (B) if the Company  shall
have elected to deposit the  Preferred  Shares with a  depositary  agent under a
depositary   arrangement,   promptly   requisition  from  the  depositary  agent
depositary receipts representing the number of one one-hundredths of a Preferred
Share to be  purchased  (in which case  certificates  for the  Preferred  Shares
represented  by such receipts  shall be deposited by the transfer agent with the
depositary  agent),  and the Company will direct the depositary  agent to comply
with all such requests,  (ii) when  appropriate,  promptly  requisition from the
Company the amount of cash to be paid in lieu of issuance of  fractional  shares
in  accordance  with Section 14 hereof,  (iii)  promptly  after  receipt of such
certificates or depositary  receipts,  cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate, registered in such
name or names as may be  designated by such holder,  and (iv) when  appropriate,
after receipt, promptly deliver such cash to or upon the order of the registered
holder of such Right Certificate.


                                        9

<PAGE>



         (d) In case  the  registered  holder  of any  Right  Certificate  shall
exercise fewer 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 and  delivered  to the  registered  holder  of such  Right
Certificate  or to his duly  authorized  assigns,  subject to the  provisions of
Section 14 hereof.

         (e)  Notwithstanding  anything in this  Agreement to the contrary,  any
Rights that are at any time  beneficially  owned by an  Acquiring  Person or any
Affiliate  or  Associate  of an  Acquiring  Person  shall  be null  and void and
nontransferable,  and any  holder of any such  Right  (including  any  purported
transferee  or  subsequent  holder)  shall  not have any  right to  exercise  or
transfer any such Right.

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

         (g) The Company may  temporarily  suspend,  for a period of time not to
exceed 90 calendar days after the Distribution  Date, the  exercisability of the
Rights  in  order  to  prepare  and  file a  Registration  Statement  under  the
Securities  Act, on  appropriate  form,  with  respect to the  Preferred  Shares
purchasable upon exercise of the Rights and permit such  Registration  Statement
to become  effective;  provided,  however,  that no such suspension shall remain
effective  after, and the Rights shall without any further action by the Company
or any other Person become  exercisable  immediately  upon, the effectiveness of
such Registration Statement. Upon any such suspension, the Company shall issue a
public  announcement  stating  that the  exercisability  of the  Rights has been
temporarily suspended and shall issue a further public announcement at such time
as the suspension is no longer in effect.  Notwithstanding  any provision herein
to the contrary,  the Rights shall not be exercisable in any jurisdiction if the
requisite   qualification  under  the  Blue  Sky  or  securities  laws  of  such
jurisdiction  shall not have been  obtained or the  exercise of the Rights shall
not be permitted under applicable law.

         Section 8.  Cancellation  and  Destruction of Right  Certificates.  All
Right Certificates surrendered for the purpose of exercise,  transfer, split-up,
combination or exchange shall,  and any Right  Certificate  representing  Rights
that have become  null and void and  nontransferable  pursuant  to Section  7(e)
hereof  surrendered  or  presented  for any purpose  shall,  if  surrendered  or
presented  to the Company or to any of its agents,  be  delivered  to the Rights
Agent for  cancellation  or in canceled form, or, if surrendered or presented to
the Rights Agent,  shall be canceled by it, and no Right  Certificates  shall be
issued in lieu thereof except as expressly permitted by any of the provisions of
this Agreement.  The Company shall deliver to the Rights Agent for  cancellation
and  retirement,  and the Rights  Agent  shall so cancel and  retire,  any Right
Certificate purchased or acquired by the Company. The Rights Agent shall deliver
all canceled Right Certificates to the

                                       10

<PAGE>



Company, or shall, at the written request of the Company,  destroy such canceled
Right  Certificates,  and in either  such case shall  deliver a  certificate  of
destruction  thereof  or a  certificate  of  cancellation  thereof,  as  may  be
appropriate, to the Company.

         Section 9.        Reservation and Availability of Capital Stock.

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

         (b) In the event that there shall not be  sufficient  Preferred  Shares
issued but not  outstanding or authorized but unissued to permit the exercise or
exchange of Rights in accordance  with Section 11 or 24 hereof,  as the case may
be, the Company covenants and agrees that it will take all such action as may be
necessary  to  authorize  additional  Preferred  Shares  for  issuance  upon the
exercise or exchange of Rights pursuant to Section 11 or 24 hereof,  as the case
may  be;  provided,  however,  that  if the  Company  is  unable  to  cause  the
authorization of additional Preferred Shares, then the Company shall, or in lieu
of seeking any such authorization,  the Company may, to the extent necessary and
permitted by applicable law and any agreements or instruments in effect prior to
the Distribution Date to which it is a party, (i) upon surrender of a Right, pay
cash  equal  to the  Purchase  Price in lieu of  issuing  Preferred  Shares  and
requiring payment therefor, (ii) upon due exercise of a Right and payment of the
Purchase  Price for each  Preferred  Share as to which such Right is  exercised,
issue  equity  securities  having a value  equal to the  value of the  Preferred
Shares which  otherwise  would have been  issuable  pursuant to Section 11 or 24
hereof,  which value shall be determined by a nationally  recognized  investment
banking firm  selected by the Board of  Directors of the Company,  or (iii) upon
due  exercise of a Right and payment of the  Purchase  Price for each  Preferred
Share as to which such Right is exercised, distribute a combination of Preferred
Shares,  cash and/or other  equity  and/or debt  securities  having an aggregate
value equal to the value of the Preferred Shares which otherwise would have bear
issuable pursuant to Section 11 or 24 hereof, which value shall be determined by
a  nationally  recognized  investment  banking  firm  selected  by the  Board of
Directors  of  the  Company.  To  the  extent  that  any  legal  or  contractual
restrictions  (pursuant  to  agreements  or  instruments  in effect prior to the
Distribution  Date to which it is a party)  prevent the Company  from paying the
full amount payable in accordance with the foregoing sentence, the Company shall
pay to  holders  of the  Rights as to which  such  payments  are being  made all
amounts  which  are not then  restricted  on a pro rata  basis as such  payments
become  permissible  under such  legal or  contractual  restrictions  until such
payments have been paid in full.

         (c) The Company  covenants and agrees that it will take all such action
as may be necessary to ensure that all Preferred  Shares delivered upon exercise
or exchange of Rights  shall,  at the time of delivery of the  certificates  for
such Preferred  Shares (subject to payment of the Purchase  Price),  be duly and
validly authorized and issued and fully paid and nonassessable.


                                       11

<PAGE>



         (d) So long as the  Preferred  Shares  issuable  upon the  exercise  or
exchange  of  Rights  may be  listed  on any  national  securities  exchange  or
automated  quotations system of a registered national securities  association on
which the  Preferred  Shares may from time to time be listed,  traded or quoted,
the Company  covenants and agrees that it will use reasonable  efforts to cause,
from and after such time as the Rights become  exercisable or exchangeable,  all
Preferred  Shares  reserved for such  issuance to be listed on such  exchange or
approved  for  quotation  in such  quotation  system,  upon  official  notice of
issuance upon such exercise.

         (e) The Company further covenants and agrees, subject to the provisions
of this Agreement, 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 Right Certificates or of any Preferred Shares or Common Shares or
other securities upon the exercise or exchange of the 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 in respect of the issuance or delivery of  certificates  for Preferred
Shares or Common Shares or other securities, as the case may be, in a name other
than that of, the registered holder of the Right  Certificate  evidencing Rights
surrendered for exercise or exchange or to issue or deliver any certificates for
Preferred Shares or Common Shares or other securities,  as the case may be, upon
the  exercise or exchange of any Rights until 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 had been established to the Company's  satisfaction  that
no such tax is due.

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

         Section 11. Adjustment of Purchase Price, Number of Shares or Number of
Rights. The Purchase Price, the number of Preferred 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.


                                       12

<PAGE>



                  (a)(i) In the event the  Company  shall at any time  after the
         date of this  Agreement (A) declare a dividend on the Preferred  Shares
         payable in Preferred  Shares,  (B) subdivide the outstanding  Preferred
         Shares,  (C) combine the  outstanding  Preferred  Shares into a smaller
         number of Preferred Shares or (D) issue any shares of its capital stock
         in a  reclassification  of the  Preferred  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 transfer books of
         the Company  for the  Preferred  Shares were open,  he 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 that would require an adjustment  under both
         this Section  11(a)(i) and Section  11(a)(ii)  hereof,  the  adjustment
         provided  for in this  Section  11(a)(i)  shall be in addition  to, and
         shall be made prior to, any  adjustment  required  pursuant  to Section
         11(a)(ii) hereof.

                  (ii)  Subject  to Section  24 of this  Agreement  and the last
         sentence of Section  23(a) of this  Agreement,  in the event any Person
         becomes an  Acquiring  Person (a  "Flip-In  Event"),  each  holder of a
         Right, except as provided in Section 7(e) hereof, shall thereafter have
         a right to receive,  upon exercise thereof at a price equal to the then
         current   Purchase   Price   multiplied   times   the   number  of  one
         one-hundredths  of  a  Preferred  Share  for  which  a  Right  is  then
         exercisable, in accordance with the terms of this Agreement and in lieu
         of Preferred Shares,  such number of Common Shares of the Company (such
         number of Common  Shares  being  referred to herein as the  "Adjustment
         Shares") as shall equal the result obtained by (x) multiplying the then
         current  Purchase  Price  times the number of one  one-hundredths  of a
         Preferred Share for which a Right is then exercisable and dividing that
         product by (y) 50 percent of the then current per share market price of
         the  Company's  Common  Shares  (determined  pursuant to Section  11(d)
         hereof) on the date of the occurrence of such event.  In the event that
         any Person shall  become an Acquiring  Person and the Rights shall then
         be  outstanding,  the  Company  shall not take any action  which  would
         eliminate  or  diminish  the  benefits  intended  to be afforded by the
         Rights.

                  (iii) In the event that there shall not be  sufficient  Common
         Shares issued but not  outstanding or authorized but unissued to permit
         the exercise in full of the Rights in accordance with Section 11(a)(ii)
         hereof,  the Company shall,  to the extent  permitted by applicable law
         and  regulation:  (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  (such  excess to be referred to
         hereinafter as the "Spread"),  and (B) with respect to each Right, make
         adequate provision to substitute for the Adjustment Shares, upon

                                       13

<PAGE>



         payment of the applicable  Purchase Price, (1) cash, (2) a reduction in
         the  Purchase  Price,  (3)  other  equity  securities  of  the  Company
         (including,   without  limitation,  shares,  or  units  of  shares,  of
         preferred  stock which the Board of Directors of the Company has deemed
         to have the same value as the Common  Shares  (such shares of preferred
         stock being  referred to herein as "common  share  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
         as  determined  by the Board of  Directors  of the  Company;  provided,
         however,  that if the Company shall not have made adequate provision to
         deliver value pursuant to clause (B) above within 30 days following the
         first occurrence of a Flip-In Event (the "Flip-In Trigger Date"),  then
         the Company  shall be  obligated  to deliver,  upon the  surrender  for
         exercise  of a Right and  without  requiring  payment  of the  Purchase
         Price,  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  determines  in good
         faith that it is likely that sufficient  additional Common Shares could
         be authorized  for issuance  upon  exercise in full of the Rights,  the
         30-day period set forth above may be extended to the extent  necessary,
         but not to more than 120 days after the Flip-In  Trigger Date, in order
         that the Company may seek stockholder approval for the authorization of
         such  additional  shares  (such  period,  as it  may be  extended,  the
         "Substitution  Period"). To the extent 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
         Section  7(e)  hereof,  that such action  shall apply  uniformly to all
         outstanding  Rights,  and (y) may  suspend  the  exercisability  of the
         Rights until the expiration of the Substitution Period in order to seek
         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  deliver a notice to the Rights Agent and issue a public
         announcement  stating  that the  exercisability  of the Rights has been
         temporarily  suspended,  as well as a notice to the Rights  Agent and 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 Flip-In Trigger Date, and the value of any common share  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 Preferred  Shares  entitling them
(for a period  expiring  within 45  calendar  days  after such  record  date) to
subscribe  for or purchase  Preferred  Shares (or shares having the same rights,
privileges  and  preferences  as the  Preferred  Shares  ("equivalent  preferred
shares"))  or  securities   convertible  into  Preferred  Shares  or  equivalent
preferred  shares at a price per Preferred  Share or equivalent  preferred share
(or  having a  conversion  price  per  share,  if a  security  convertible  into
Preferred Shares or equivalent  preferred shares) less than the then current per
share market price of the Preferred  Shares (as defined in Section 11(d) hereof)
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 times a fraction,  the numerator of which shall be the
number of Preferred  Shares  outstanding  on such record date plus the number of
Preferred  Shares  which the  aggregate  offering  price of the total  number of
Preferred Shares

                                       14

<PAGE>



and/or  equivalent  preferred  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 Preferred  Shares  outstanding  on such record date plus the number of
additional Preferred Shares and/or equivalent preferred 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
consideration  part or all of which may be in a form other than cash,  the value
of such  consideration  shall be as  determined  in good  faith by the  Board of
Directors of the Company,  whose determination shall be described in a statement
filed with the Rights Agent.  Preferred  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  Preferred  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
Preferred Shares) or subscription  rights or warrants  (excluding those referred
to in Section  11(b)  hereof),  the  Purchase  Price to be in effect  after such
record date shall be  determined  by  multiplying  the Purchase  Price in effect
immediately  prior to such record date times a fraction,  the numerator of which
shall be the then current per share market price of the Preferred Shares 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  Preferred  Share and the  denominator  of which shall be such
current per share market price of the Preferred 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)(i) For the  purpose of any  computation  hereunder,  other
         than  computations  made  pursuant to Section  11(a)(iii)  hereof,  the
         "current per share market price" of any security (a "Security"  for the
         purpose of this Section 11(d)(i)) on any date shall be deemed to be the
         average of the daily closing  prices per share of such Security for the
         30  consecutive  Trading  Days (as such  term is  hereinafter  defined)
         immediately  prior to such date, and for purposes of computations  made
         pursuant to Section  11(a)(iii)  hereof,  the "current per share market
         price" of a Security  on any date shall be deemed to be the  average of
         the  daily  closing  prices  per  share  of  such  Security  for the 10
         consecutive  Trading Days  immediately  following such date;  provided,
         however, that in the event that

                                       15

<PAGE>



         the current per share market price of the Security is determined during
         a period  following the  announcement by the issuer of such Security of
         (A) a dividend or  distribution  on such Security  payable in shares of
         such  Security or securities  convertible  into shares of such Security
         (other  than  the  Rights),  or (B)  any  subdivision,  combination  or
         reclassification  of such Security,  and the ex-dividend  date for such
         dividend  or  distribution,  or the record  date for such  subdivision,
         combination or  reclassification,  shall not have occurred prior to the
         commencement  of the requisite 30 Trading Day or 10 Trading Day period,
         as set forth above, then, and in each such case, the "current per share
         market  price" shall be  appropriately  adjusted to reflect the current
         market price per share  equivalent of such Security.  The closing price
         for each 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
         Security  is 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  Security  is  listed  or
         admitted  to trading  or, if the  Security is 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 Security is 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  Security  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  Security  is  listed  or
         admitted to trading is open for the  transaction of business or, if the
         Security  is  not  listed  or  admitted  to  trading  on  any  national
         securities exchange, a Business Day.

                  (ii)  For  the  purpose  of  any  computation  hereunder,  the
         "current  per share  market  price" of the  Preferred  Shares  shall be
         determined in accordance with the method set forth in Section  11(d)(i)
         hereof.  If the Preferred Shares are not publicly traded,  the "current
         per share market price" of the Preferred  Shares shall be  conclusively
         deemed to be the current per share market  price of the Common  Shares,
         as  determined  pursuant  to  Section  11(d)(i)  hereof  (appropriately
         adjusted  to  reflect  any  stock  split,  stock  dividend  or  similar
         transaction occurring after the date hereof),  multiplied times 100. If
         neither the Common Shares nor the Preferred Shares are publicly held or
         so listed or traded,  "current per share  market  price" shall mean the
         fair  value  per  share 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.

         (e) Except as hereinafter provided, no adjustment in the Purchase Price
shall be required unless such  adjustment  would require an increase or decrease
of at least one  percent 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

                                       16

<PAGE>



nearest one  one-millionth  of a Preferred  Share or one  ten-thousandth  of any
other share or security, 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 and (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)
hereof,  the holder of any Right  thereafter  exercised shall become entitled to
receive any shares of capital stock of the Company other than Preferred  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
Preferred Shares contained in Section 11(a) through (c) hereof,  inclusive,  and
the  provisions of Sections 7, 9, 10 and 13 hereof with respect to the Preferred
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 one one-hundredths of a
Preferred  Share  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) hereof,  upon each adjustment of the Purchase Price as a result of
the calculations  made in Sections 11(b) and (c) hereof,  each Right outstanding
immediately prior to the making of such adjustment shall thereafter evidence the
right  to  purchase,  at  the  adjusted  Purchase  Price,  that  number  of  one
one-hundredths of a Preferred Share (calculated to the nearest one one-millionth
of a  Preferred  Share)  obtained  by (i)  multiplying  (x)  the  number  of one
one-hundredths  of a  share  covered  by  a  Right  immediately  prior  to  this
adjustment  times (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 one  one-hundredths of a Preferred Share 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 one
one-hundredths   of  a  Preferred  Share  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 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

                                       17

<PAGE>



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 so to be 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 one one-hundredths of a Preferred Share 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 one one-hundredths of a
Preferred  Share 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 one one-hundredth of the then par value, if any, of the
Preferred  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 Preferred 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 Preferred  Shares and other  capital stock or securities of the Company,  if
any,  issuable upon such exercise over and above the Preferred  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 or securities upon the occurrence of the event requiring such adjustment.

         (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 (i)  consolidation or subdivision of the Preferred  Shares,  (ii)
issuance wholly for cash of any Preferred Shares at less than the current market
price, (iii) issuance wholly for cash of Preferred Shares or securities which by
their terms are convertible  into or  exchangeable  for Preferred  Shares,  (iv)
dividends on Preferred  Shares payable in Preferred  Shares,  or (v) issuance of
rights,  options or warrants referred to hereinabove in Section 11(b), hereafter
made by the Company to holders of its Preferred Shares,  shall not be taxable to
such stockholders.

         (n) Anything in this Agreement to the contrary notwithstanding,  in the
event  that at any  time  after  the  date of this  Agreement  and  prior to the
Distribution  Date,  the Company  shall (i)  declare or pay any  dividend on the
Common Shares payable in Common Shares or (ii) effect a

                                       18

<PAGE>



subdivision,   combination   or   consolidation   of  the   Common   Shares  (by
reclassification  or otherwise  than by payment of  dividends in Common  Shares)
into a greater or lesser number of Common Shares,  then in any such case (A) the
number of one  one-hundredths  of a Preferred Share purchasable after such event
upon proper exercise of each Right shall be determined by multiplying the number
of one  one-hundredths of a Preferred Share so purchasable  immediately prior to
such event  times a  fraction,  the  numerator  of which is the number of Common
Shares outstanding immediately before such event and the denominator of which is
the number of Common Shares  outstanding  immediately  after such event, and (B)
each Common  Share  outstanding  immediately  after such event shall have issued
with  respect to it that number of Rights  which each Common  Share  outstanding
immediately  prior to such event had issued with respect to it. The  adjustments
provided for in this Section  11(n) shall be made  successively  whenever such a
dividend is declared or paid or such a subdivision, combination or consolidation
is effected.

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

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

         (a) In the event,  directly or  indirectly,  at any time after a Person
has become an Acquiring Person, (i) the Company shall consolidate with, or merge
with and into,  any other  Person,  (ii) any Person shall  consolidate  with the
Company,  or  merge  with  and into the  Company  and the  Company  shall be the
continuing or surviving  corporation of such merger and, in connection with such
merger,  all or part of the Common Shares shall be changed into or exchanged for
capital  stock or other  securities of any other Person (or the Company) or cash
or any other property, or (iii) the Company shall sell or otherwise transfer (or
one or more of its  Subsidiaries  shall sell or otherwise  transfer),  in one or
more transactions, assets or earning power aggregating 50 percent or more of the
assets or earning power of the Company and its  Subsidiaries  (taken as a whole)
to any other  Person  other than the Company or one or more of its  wholly-owned
Subsidiaries  (any such event  described  in clauses  (i),  (ii) or (iii)  being
referred to herein as a "Flip-Over Event"),  then, and in each such case, proper
provision  shall be made so that (A) 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 times the
number  of one  one-hundredths  of a  Preferred  Share for which a Right is then
exercisable,  in  accordance  with the  terms of this  Agreement  and in lieu of
Preferred  Shares,  such number of validly  authorized  and issued,  fully paid,
nonassessable  and freely tradable Common Shares of the Principal Party (as such
term is hereinafter  defined),  free and clear of liens,  encumbrances  or other
adverse  claims,  as shall equal the result obtained by (1) multiplying the then
current  Purchase  Price times the number of one  one-hundredths  of a Preferred
Share for which a Right is exercisable immediately prior to the first occurrence
of a Flip-Over Event (or,

                                       19

<PAGE>



if a Flip-In  Event has occurred  prior to the first  occurrence  of a Flip-Over
Event,  multiplying the number of such one one-hundredths of a share for which a
Right was  exercisable  immediately  prior to the first  occurrence of a Flip-In
Event  times  the  Purchase  Price in  effect  immediately  prior to such  first
occurrence), and dividing that product (which, following the first occurrence of
a Flip-Over  Event,  shall be referred to as the "Purchase Price" for each Right
and for all  purposes of this  Agreement)  by (2) 50 percent of the then current
per share market price of the Common Shares of such Principal Party  (determined
pursuant  to  Section  11(d)  hereof)  on  the  date  of  consummation  of  such
consolidation,  merger,  sale  or  transfer;  (B)  such  Principal  Party  shall
thereafter  be liable for, and shall  assume,  by virtue of such  consolidation,
merger, sale or transfer, all the obligations and duties of the Company pursuant
to this Agreement; (C) the term "Company" shall thereafter be deemed to refer to
such  Principal  Party,  it being  specifically  intended that the provisions of
Section 11 hereof shall apply only to such Principal  Party  following the first
occurrence of a Flip-Over  Event; (D) such Principal Party shall take such steps
(including,  but not limited to, the  reservation of a sufficient  number of its
Common  Shares in  accordance  with  Section 9 hereof) in  connection  with such
consummation  as may be  necessary  to assure that the  provisions  hereof shall
thereafter be  applicable,  as nearly as  reasonably  may be, in relation to the
Common Shares  thereafter  deliverable upon the exercise of the Rights;  and (E)
the provisions of Section  11(a)(ii)  hereof shall be of no effect following the
first  occurrence of any Flip-Over  Event.  The Company shall not consummate any
such  consolidation,  merger,  sale or transfer unless prior thereto the Company
and such Principal Party shall have executed and delivered to the Rights Agent a
supplemental  agreement  so  providing.  The  Company  shall not enter  into any
transaction  of the kind  referred to in this  Section 13 if at the time of such
transaction   there  are  any  rights,   warrants,   instruments  or  securities
outstanding  or  any  agreements  or  arrangements  which,  as a  result  of the
consummation of such transaction,  would eliminate or substantially diminish the
benefits  intended to be afforded by the Rights.  The provisions of this Section
13 shall similarly  apply to successive  mergers or  consolidations  or sales or
other transfers.

         (b)      "Principal Party" shall mean

                  (i) in the case of any transaction  described in clause (i) or
         (ii) of the first sentence of Section 13(a) hereof,  the Person that is
         the issuer of any  securities  into which Common  Shares of the Company
         are converted in such transaction, or if there is more than one issuer,
         the issuer of Common Shares with the greatest  aggregate  market value,
         and if no securities are so issued,  the Person that is the other party
         to such  transaction,  or if there is more  than one such  Person,  the
         Person having Common Shares with the greatest  aggregate  market value;
         and

                  (ii) in the case of any transaction  described in clause (iii)
         of the first  sentence of Section 13(a) hereof,  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-month  period  registered under Section 12 of the
         Exchange Act, and such Person is a direct or indirect Subsidiary of any
         Person the Common Shares of which are and have been so registered,

                                       20

<PAGE>



         "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.

         Section 14.       Fractional Rights and Fractional Shares.

         (a) The Company may,  but shall not be required to, issue  fractions of
Rights or distribute Right  Certificates  which evidence  fractional  Rights. In
lieu of such fractional Rights, the Company may pay 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 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 New York
Stock  Exchange  or, if the Rights 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 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 may,  but shall not be required to, issue  fractions of
Preferred  Shares upon exercise of the Rights or distribute  certificates  which
evidence  fractional  Preferred Shares. In lieu of fractional  Preferred Shares,
the Company may elect to (i) utilize a depository arrangement as provided by the
terms of the  Preferred  Shares or (ii) in the case of a fraction of a Preferred
Share  (other  than one  one-hundredth  of a  Preferred  Share  or any  integral
multiple  thereof),  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 a whole Preferred Share, if any are
outstanding  and publicly traded (or the Formula Number (as such term is defined
in  Section 2 of the  Certificate  of  Designations)  then in  effect  times the
current  market value of a whole Common  Share if the  Preferred  Shares are not
outstanding  and  publicly  traded).  For purposes of this  Section  14(b),  the
current market value of a Preferred Share (or Common Share) shall be the closing
price of a  Preferred  Share (or Common  Share) (as  determined  pursuant to the
second  sentence of Section  11(d)(i)  hereof)  for the Trading Day  immediately
prior to the  date of such  exercise.  If,  as a result  of an  adjustment  made
pursuant to Section 11 hereof,

                                       21

<PAGE>



the holder of any Right  thereafter  exercised  shall become entitled to receive
any securities other than Preferred Shares, the provisions of this Section 14(b)
shall  apply,  as  nearly as  reasonably  may be,  on like  terms to such  other
securities.

         (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 or exchange of a Right except as provided in this Section 14.

         Section 15.  Rights of Action.  All rights of action in respect of this
Agreement,  excepting  the  rights of action  given to the  Rights  Agent  under
Section 18 hereof, are vested in the respective  registered holders of the 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  hereunder,  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  will be
transferable,  subject to Section 7(e) hereof, 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  Certificate 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

         (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

                                       22

<PAGE>



or permanent  injunction  or other order,  decree or ruling 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  obligations;  provided,  however,  the  Company  must  use
reasonable efforts to have any such order,  decree or ruling lifted or otherwise
overturned as soon as reasonably practicable.

         Section  17.  Right  Certificate  Holder Not Deemed a  Stockholder.  No
holder,  as such, of any Right  Certificate shall be entitled to vote or receive
dividends or be deemed,  for any purpose,  the holder of the Preferred 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  stockholder  of the  Company,
including,  without limitation,  any right to vote for the election of directors
or upon any other matter submitted to stockholders at any meeting thereof, or to
give or  withhold  consent to any  corporate  action,  or to  receive  notice of
meetings or other actions affecting  stockholders (except as provided in Section
25 hereof),  or to receive  dividends  or other  distributions  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  administration  and  execution  of  this
Agreement and the exercise and performance of its duties hereunder.

         (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  Preferred  Shares or Common Shares or for
other securities of the Company,  instrument of assignment or transfer, power of
attorney,   endorsement,   affidavit,   letter,  notice,   direction,   consent,
certificate,  statement, or other paper or document believed by it 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 corporation into which the Rights Agent or any successor Rights
Agent may be merged or with  which it may be  consolidated,  or any  corporation
resulting  from any merger or  consolidation  to which the  Rights  Agent or any
successor  Rights Agent shall be a party, or any  corporation  succeeding to the
stock  transfer or corporate  trust powers 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 corporation would be eligible for
appointment as a successor Rights Agent

                                       23

<PAGE>



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  imposed by this Agreement upon the following  terms and
conditions,  by all of which the Company  and the holders of Right  Certificates
(or, prior to the Distribution Date, of the Common Shares),  by their acceptance
thereof, shall be bound:

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

         (b) Whenever in the  performance of its duties under this Agreement the
Rights Agent shall deem it  necessary  or  desirable  that any fact or matter 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 be deemed to be  conclusively  proved and
established by a certificate signed by any one of the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such certificate
shall be full authorization to the Rights Agent for any action taken or suffered
in good faith by it under the provisions of this Agreement in reliance upon such
certificate.

         (c) The Rights  Agent shall be liable  hereunder to the Company and any
other Person only for its own negligence, bad faith or willful misconduct.

         (d) The Rights Agent shall not be liable for or by reason of any of the
statements  of fact or  recitals  contained  in this  Agreement  or in the 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.


                                       24

<PAGE>



         (e) The Rights Agent shall not be under any  responsibility  in respect
of the validity of this  Agreement or the execution and delivery  hereof (except
the due  execution  hereof by the Rights Agent) or in respect of the validity or
execution of any 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  null and void and  nontransferable  pursuant  to Section  7(e)
hereof) or any  adjustment  in the terms of the Rights  (including  the  manner,
method or amount thereof) provided for in Section 3, 11, 13, 23 or 24 hereof, 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  Preferred  Shares or
Common Shares to be issued  pursuant to this Agreement or any Right  Certificate
or as to whether any Preferred Shares or Common Shares will, when so issued,  be
validly authorized and issued, fully paid and nonassessable.

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

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

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

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

         (j) The  Company  agrees  to  indemnify  and to hold the  Rights  Agent
harmless against any loss,  liability or expense (including  reasonable fees and
expenses of counsel) that the Rights Agent may incur  resulting from its actions
as Rights Agent pursuant to this Agreement; provided,

                                       25

<PAGE>



however,  that the Rights Agent shall not be  indemnified  or held harmless with
respect to any such loss,  liability,  damage or expense  incurred by the Rights
Agent as a result  of,  or  arising  out of,  its own  negligence,  bad faith or
willful  misconduct.  In no case shall the Company be liable with respect to any
action,  proceeding,  suit or claim  against the Rights  Agent unless the Rights
Agent shall have  notified the Company,  by letter or by facsimile  confirmed by
letter,  of the assertion of any action,  proceeding,  suit or claim against the
Rights  Agent,  promptly  after the Rights  Agent  shall have notice of any such
assertion of an action,  proceeding,  suit or claim or have been served with the
summons or other first legal  process  giving  information  as to the nature and
basis of the action, proceeding, suit or claim. The Company shall be entitled to
participate  at its own expense in the defense of any such  action,  proceeding,
suit or claim,  and, if the  Company so elects,  the  Company  shall  assume the
defense of any such  action,  proceeding,  suit or claim.  In the event that the
Company assumes such defense, the Company shall not thereafter be liable for the
fees and expenses of any  additional  counsel  retained by the Rights Agent,  so
long as the Company shall retain counsel  satisfactory  to the Rights Agent,  in
the exercise of its reasonable judgment, to defend such action, proceeding, suit
or claim.  The Rights Agent agrees not to settle any  litigation  in  connection
with any  action,  proceeding,  suit or claim with  respect to which it may seek
indemnification  from the  Company  without  the prior  written  consent  of the
Company.

         Section 21. Change of Rights  Agent.  The Rights Agent or any successor
Rights Agent may resign and be discharged  from its duties under this  Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Shares or Preferred Shares by registered or certified mail, and to
the holders of the Right  Certificates  (or, prior to the Distribution  Date, of
the Common Shares) 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 or Preferred  Shares by registered or certified mail,
and to the  holders of the Right  Certificates  (or,  prior to the  Distribution
Date,  of the Common  Shares) 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  (or,  prior to the  Distribution  Date, of the Common  Shares) (who
shall,  with  such  notice,  submit  his  Right  Certificate  or,  prior  to the
Distribution   Date,  the  certificate   representing  his  Common  Shares,  for
inspection by the Company),  then the registered holder of any Right Certificate
(or,  prior to the  Distribution  Date,  of the Common  Shares) may apply to any
court of competent  jurisdiction  for the appointment of a new Rights Agent. Any
successor  Rights  Agent,  whether  appointed by the Company or by such a court,
shall be a corporation organized and doing business under the laws of the United
States or of the State of New York (or of any other  state of the United  States
so long as such  corporation  is  authorized  to  conduct  a stock  transfer  or
corporate trust business in the State of New York), in good standing,  having an
office or agency in the State of New York,  which is authorized  under such laws
to  exercise  stock  transfer  or  corporate  trust  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 $50 million;  provided  that the principal  transfer  agent for the Common
Shares  shall  in  any  event  be  qualified  to  be  the  Rights  Agent.  After
appointment, the

                                       26

<PAGE>



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 or Preferred  Shares,  and mail a
notice  thereof in writing to the  registered  holder of the Right  Certificates
(or, prior to the Distribution Date, of the Common Shares).  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 and Additional  Rights.
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 of
the Company to reflect any  adjustment  or change  made in  accordance  with the
provisions of this  Agreement.  In addition,  in connection with the issuance or
sale of Common Shares following the  Distribution  Date and prior to the earlier
of the  Redemption  Date and the Final  Expiration  Date, the Company (i) shall,
with  respect to Common  Shares so issued or sold  pursuant  to the  exercise of
stock options or under any employee plan or  arrangement,  or upon the exercise,
conversion or exchange of securities, notes or debentures issued by the Company,
and (ii) may, in any other case, if deemed necessary or appropriate by the Board
of  Directors  of  the  Company,  issue  Right  Certificates   representing  the
appropriate number of Rights in connection with such issuance or sale; provided,
however,  that no such Right  Certificate  shall be issued if, and to the extent
that,  the Company shall be advised by counsel that such issuance would create a
significant  risk of  material  adverse tax  consequences  to the Company or the
Person  to whom  such  Right  Certificate  would be  issued,  and no such  Right
Certificate shall be issued if, and to the extent that,  appropriate  adjustment
shall otherwise have been made in lieu of the issuance thereof.

         Section 23.       Redemption.

         (a) A majority of the Board of  Directors  of the  Company  may, at its
option,  at any time prior to the  earlier of (i) the close of  business  on the
tenth day following the Shares  Acquisition Date (or, if the Shares  Acquisition
Date shall have occurred  prior to the Record Date, the close of business on the
tenth day following the Record Date) and (ii) the Final Expiration Date,  redeem
all but not less than all the then  outstanding  Rights at a redemption price of
$.01 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 of the Company may be made  effective at
such time,  on such basis and with such  conditions as the Board of Directors of
the Company in its sole  discretion may establish.  From and after the time that
any Person  shall  become an  Acquiring  Person,  the Board of  Directors of the
Company may extend the time period described in clause (i) of the first sentence
of this Section 23(a) or may redeem the Rights only if at the time of the action
of the Board of Directors of the Company  there are then in office not less than
a majority of  directors  who are  Continuing  Directors  and such  extension or
redemption is

                                       27

<PAGE>



approved  by  a  majority   of  the   Continuing   Directors   then  in  office.
Notwithstanding anything contained in this Agreement to the contrary, the Rights
shall not be exercisable  pursuant to Section  11(a)(ii) prior to the expiration
of the Company's right of redemption hereunder.

         (b)  Immediately  upon the  action  of the  Board of  Directors  of the
Company  ordering the redemption of the Rights pursuant to paragraph (a) of this
Section 23, and without any further action and without any notice,  the right to
exercise the Rights will terminate and the only right  thereafter of the holders
of Rights  shall be to receive the  Redemption  Price.  Within 10 Business  Days
after  the  action  of the  Board  of  Directors  of the  Company  ordering  the
redemption of the Rights,  the Company  shall give notice of such  redemption to
the holders of the then  outstanding  Rights by mailing  such notice to all such
holders 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.  Each such notice of redemption will state
the method by which payment of the Redemption Price will be made. The notice, if
mailed in the manner herein  provided,  shall be  conclusively  presumed to have
been duly given,  whether or not the holder of Rights  receives such notice.  In
any case,  failure to give such notice by mail, or any defect in the notice,  to
any  particular  holder of Rights shall not affect the  sufficiency of notice to
other  holders of Rights.  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,  mandatorily  exchange all or
part of the then  outstanding  and  exercisable  Rights (which shall not include
Rights that shall have become null and void and nontransferable  pursuant to the
provisions of Section 7(e) 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 of the Company 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,  or any entity  holding Common Shares of the Company for or pursuant
to the terms of any such plan),  together with all  Affiliates and Associates of
such Person,  becomes the  Beneficial  Owner of 50 percent 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 paragraph  (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  times 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

                                       28

<PAGE>



Company  promptly shall mail a notice of any such exchange to all 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 rata
based on the number of Rights (other than Rights which have become null and void
and  nontransferable  pursuant to the provisions of Section 7(e) hereof) held by
each holder of Rights.

         (c) In any exchange  pursuant to this  Section 24, the Company,  at its
option,  may substitute  Preferred Shares (or equivalent  preferred  shares) for
Common Shares  exchangeable for Rights, at the initial rate of one one-hundredth
of a Preferred Share (or equivalent  preferred  share) for each Common Share, as
appropriately  adjusted  to  reflect  adjustments  in the  voting  rights of the
Preferred  Shares  pursuant  to the terms  thereof,  so that the  fraction  of a
Preferred  Share  delivered  in lieu of each  Common  Share  shall have the same
voting rights as one Common Share.

         (d) In the event that the number of Common  Shares or Preferred  Shares
which  are  issued  but not  outstanding  or  authorized  but  unissued  are not
sufficient to permit any exchange of Rights as  contemplated  in accordance with
this Section 24, the Company may, at its option,  take all such action as may be
necessary to authorize additional Common Shares or Preferred Shares.

         (e) The Company may,  but shall not be required to, issue  fractions of
Common Shares upon exchange of Rights  pursuant to this Section 24 or distribute
certificates which evidence fractional Common Shares. In lieu of such fractional
Common  Shares,  the  Company  may pay to the  registered  holders  of the Right
Certificates  with regard to which such fractional Common Shares would otherwise
be issuable an amount in cash equal to the same  fraction of the current  market
value of a whole Common Share for the Trading Day immediately  prior to the date
of exchange pursuant to this Section 24. For 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)(i)
hereof).

         Section 25.       Notice of Certain Events.

         (a) In case the Company shall  propose (i) to pay any dividend  payable
in capital stock of any class to the holders of its Preferred  Shares or to make
any other  distribution  to the holders of its  Preferred  Shares  (other than a
regular quarterly cash dividend),  (ii) to offer to the holders of its Preferred
Shares  rights or  warrants  to  subscribe  for or to  purchase  any  additional
Preferred  Shares  or  shares  of  capital  stock  of any  class  or  any  other
securities,  rights or  options,  (iii) to effect  any  reclassification  of its
Preferred Shares (other than a  reclassification  involving only the subdivision
of outstanding  Preferred  Shares),  (iv) to effect any  consolidation or merger
into or 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  percent  or more of the  assets  or  earning  power of the
Company and its  Subsidiaries  (taken as a whole) to, any other  Person,  (v) to
effect the  liquidation,  dissolution  or winding up of the Company,  or (vi) to
declare or pay any dividend on the Common Shares  payable in Common Shares or to
effect a subdivision,

                                       29

<PAGE>



combination  or  consolidation  of the  Common  Shares (by  reclassification  or
otherwise  than by payment of dividends in Common  Shares),  then,  in each such
case, the Company shall give to each holder of a Right Certificate (or, prior to
the  Distribution  Date, of the Common  Shares),  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,  sale,
transfer, liquidation,  dissolution, or winding up is to take place and the date
of  participation  therein by the holders of the Common Shares and/or  Preferred
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 the  Preferred  Shares for
purposes of such action,  and in the case of any such other action,  at 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  and/or  Preferred
Shares, whichever shall be the earlier.

         (b) In case a Flip-In Event shall occur, then the Company shall as soon
as practicable  thereafter give to each holder of a Right Certificate (or, prior
to the  Distribution  Date, of Common  Shares),  in  accordance  with Section 26
hereof,  a notice of the  occurrence of such event,  which notice shall describe
such event and the consequences of such event to holders of Rights under Section
11(a)(ii) hereof.

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

                  Magnum Hunter Resources, Inc.
                  600 E. Las Colinas Blvd., Suite 1200
                  Irving, Texas 75039
                  Attn:    Corporate Secretary

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:

                  Securities Transfer Corporation
                  16910 Dallas Parkway, Suite 100
                  Dallas, Texas 75248

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.


                                       30

<PAGE>



         Section  27.  Supplements  and  Amendments.  At any  time  prior to the
Distribution  Date and subject to the last two sentences of this Section 27, the
Company may by action of its Board of  Directors,  and the Rights Agent shall if
the Company so directs,  supplement  or amend any  provision  of this  Agreement
(including,  without limitation, the date upon which the Distribution Date shall
occur,  the time during which the Rights may be redeemed  pursuant to Section 23
or any provision of the Certificate of  Designations)  in any manner without the
approval of any holder of the Rights.  From and after the Distribution  Date and
subject to applicable  law, the Company may by action of its Board of Directors,
and the  Rights  Agent  shall  if the  Company  so  directs,  from  time to time
supplement or amend this Agreement  without the approval of any holders of Right
Certificates  in order (i) to cure any ambiguity or to correct or supplement any
provision  contained in this  Agreement  which may be defective or  inconsistent
with any other provision of this Agreement or (ii) to make any other  provisions
in regard to matters or questions  arising  hereunder which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of the Rights or Right  Certificates  (other than an Acquiring Person or
any Affiliate or Associate of an Acquiring Person).  Any supplement or amendment
adopted  during any period after any Person has become an  Acquiring  Person but
prior to the Distribution  Date shall be null and void unless such supplement or
amendment  could have been adopted  under the prior  sentence from and after the
Distribution Date.  Without limiting the foregoing,  the Company may at any time
prior to the Distribution  Date amend this Agreement to lower the thresholds set
forth in the  definition of Acquiring  Person in Section 1 hereof and in Section
3(b) hereof to not less than the greater of (i) the sum of 0.001 percent and the
largest percentage of the outstanding Common Shares then known by the Company to
be beneficially  owned by any Person (other than the Company,  any Subsidiary of
the Company,  any employee  benefit plan of the Company or any Subsidiary of the
Company,  or any entity  holding Common Shares of the Company for or pursuant to
the  terms of any  such  plan)  and (ii) 10  percent.  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;  provided,
however,  that the Rights Agent may,  but shall not be obligated  to, enter into
any such  supplement  or  amendment  which  affects  its own  rights,  duties or
immunities under this Agreement.  Prior to the Distribution  Date, the interests
of the holders of Rights shall be deemed  coincident  with the  interests of the
holders  of the  Common  Shares of the  Company.  In  addition,  notwithstanding
anything to the contrary contained in this Agreement, no supplement or amendment
to this Agreement  shall be made which (i) reduces the Redemption  Price (except
as required  hereunder  by  appropriate  adjustment  to reflect any stock split,
stock  dividend  or  similar  transaction  occurring  after  the  date  of  this
Agreement)   or  (ii)   provides   for  an  earlier   Final   Expiration   Date.
Notwithstanding  anything  to the  contrary  contained  in this  Agreement,  any
supplement  or amendment  may be made after the time that any Person  becomes an
Acquiring  Person only if at the time of the action of the Board of Directors of
the Company  approving such supplement or amendment there are then in office not
less  than a  majority  of  directors  who are  Continuing  Directors  and  such
supplement  or amendment is approved by a majority of the  Continuing  Directors
then in office.

         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.

                                       31

<PAGE>



         Section 29. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any Person other than the Company,  the Rights Agent and
the registered holders of the Right Certificates (and, prior to the Distribution
Date, of 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, of 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 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 LAWS OF THE STATE
OF NEVADA 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,  each  of  which  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 of this
Agreement.

         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.

                                                 MAGNUM HUNTER RESOURCES, INC.

Attest:

By:                                             By:
Name:                                         Name:
Title:                                       Title:

                                                 SECURITIES TRANSFER CORPORATION
Attest:

By:                                             By:
Name:                                         Name:
Title:                                       Title:

                                       32

<PAGE>


                                  EXHIBIT "A"

<PAGE>


                                  

                           CERTIFICATE OF DESIGNATIONS

                                       of

               1998 SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

                                       of

                          MAGNUM HUNTER RESOURCES, INC.



              Pursuant to Section 78.195 of Nevada Revised Statutes




         MAGNUM HUNTER  RESOURCES,  INC., a  corporation  organized and existing
under the General  Corporation  Law of the State of Nevada (the  "Corporation"),
does hereby  certify that,  pursuant to the authority  conferred on the Board of
Directors of the Corporation by the Articles of  Incorporation,  as amended,  of
the Corporation (the "Articles of Incorporation") and in accordance with Section
78.195 of the Nevada  Revised  Statutes  of the General  Corporation  Law of the
State of Nevada,  the Board of Directors of the Corporation on December 12, 1997
adopted the following resolution establishing and creating a series of Preferred
Stock, par value $.001 per share, of the Corporation designated as 1998 Series A
Junior Participating Preferred Stock:

                  RESOLVED,  that, pursuant to the authority vested in the Board
         of Directors of the  Corporation  in accordance  with the provisions of
         the Articles of Incorporation, as amended, of the Corporation, a series
         of Preferred  Stock,  par value $.001 per share,  of the Corporation is
         hereby established and created,  and that the designation and number of
         shares  thereof  and the  voting  and  other  powers,  preferences  and
         relative,  participating,  optional  and  other  special  rights of the
         shares  of  such  series,  and  the  qualifications,   limitations  and
         restrictions thereof, are as follows:

               1998 Series A Junior Participating Preferred Stock

         Section 1.  Designation and Amount.  The shares of such series shall be
designated as "Series A Junior Participating  Preferred Stock" (the "1998 Series
A Preferred Stock"). The number of shares initially constituting the 1998 Series
A Preferred Stock shall be 500,000; provided, however, that if more than a total
of 500,000  shares of 1998 Series A Preferred  Stock shall be issuable  upon the
exercise of Rights (the "Right") issued  pursuant to the Rights  Agreement dated
as of January 6, 1998, between the Corporation and Securities Transfer Agent, as
Rights


                                        1

<PAGE>



Agent (the  "Rights  Agreement"),  the Board of  Directors  of the  Corporation,
pursuant  to  Section  78.195  of  Nevada  Revised  Statutes,  shall  direct  by
resolution or resolutions that a certificate be properly executed, acknowledged,
filed and recorded, in accordance with such provisions,  providing for the total
number of shares of 1998 Series A Preferred Stock  authorized to be issued to be
increased (to the extent that the Articles of Incorporation then permits) to the
largest number of whole shares  (rounded up to the nearest whole share) issuable
upon exercise of such Rights.

         Section 2.  Dividends and Distributions.

         (a) Subject to the prior and  superior  rights of the holders of shares
of any  other  series  of  Preferred  Stock  or  other  class  of  stock  of the
Corporation ranking prior and superior to the 1998 Series A Preferred Stock with
respect to  dividends,  the holders of shares of 1998  Series A Preferred  Stock
shall  be  entitled  to  receive,  when,  as and if  declared  by the  Board  of
Directors,  out of the assets of the Corporation legally available therefor, (i)
quarterly  dividends  payable in cash on the last day of each fiscal  quarter in
each year,  or such other  dates as the Board of  Directors  of the  Corporation
shall approve (each such date being referred to herein as a "Quarterly  Dividend
Payment Date"),  commencing on the first Quarterly  Dividend  Payment Date after
the  first  issuance  of a share  or a  fraction  of a share  of 1998  Series  A
Preferred  Stock,  in the amount of $.01 per whole share (rounded to the nearest
cent)  less the  amount  of all cash  dividends  declared  on the 1998  Series A
Preferred  Stock  pursuant to the  following  clause (ii) since the  immediately
preceding  Quarterly  Dividend  Payment  Date  or,  with  respect  to the  first
Quarterly  Dividend  Payment  Date,  since  the first  issuance  of any share or
fraction of a share of 1998  Series A Preferred  Stock (the total of which shall
not, in any event, be less than zero) and (ii) dividends  payable in cash on the
payment  date for each cash  dividend  declared on the Common Stock in an amount
per whole share  (rounded to the nearest  cent) equal to the Formula  Number (as
hereinafter  defined) then in effect multiplied times the cash dividends then to
be paid on each share of Common Stock. In addition, if the Corporation shall pay
any dividend or make any  distribution  on the Common  Stock  payable in assets,
securities  or other forms of noncash  consideration  (other than  dividends  or
distributions  solely in shares of Common  Stock),  then, in each such case, the
Corporation shall  simultaneously pay or make on each outstanding whole share of
1998 Series A Preferred  Stock a dividend or  distribution in like kind equal to
the Formula Number then in effect multiplied times such dividend or distribution
on each share of the Common Stock. As used herein, the "Formula Number" shall be
100;  provided,  however,  that,  if at any time after  January  20,  1998,  the
Corporation shall (x) declare or pay any dividend on the Common Stock payable in
shares of Common Stock or make any distribution on the Common Stock in shares of
Common Stock,  (y) subdivide  (by a stock split or  otherwise)  the  outstanding
shares of Common  Stock  into a larger  number of shares of Common  Stock or (z)
combine (by a reverse stock split or otherwise) the outstanding shares of Common
Stock into a smaller  number of shares of Common Stock,  then in each such event
the Formula Number shall be adjusted to a number  determined by multiplying  the
Formula  Number in effect  immediately  prior to such event by a  fraction,  the
numerator of which is the number of shares of Common Stock that are  outstanding
immediately  after  such  event and the  denominator  of which is the  number of
shares of Common Stock that are outstanding immediately prior to such event (and
rounding the result to the nearest whole number); and provided further, that, if
at any time after January 20, 1998, the Corporation shall issue any shares


                                        2

<PAGE>



of its stock in a merger, reclassification,  or change of the outstanding shares
of  Common  Stock,  then  in  each  such  event  the  Formula  Number  shall  be
appropriately  adjusted to reflect  such merger,  reclassification  or change so
that each share of 1998 Series A Preferred  Stock  continues  to be the economic
equivalent  of a Formula  Number of shares of Common Stock prior to such merger,
reclassification or change.

         (b) The  Corporation  shall declare a dividend or  distribution  on the
1998 Series A  Preferred  Stock as provided  in  paragraph  (a) of this  Section
immediately  prior to or at the same time it declares a dividend or distribution
on the Common Stock (other than a dividend or  distribution  solely in shares of
Common Stock); provided, however, that, in the event no dividend or distribution
(other than a dividend or  distribution  solely in shares of Common Stock) shall
have been  declared on the Common Stock during the period  between any Quarterly
Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a
dividend  of  $.01  per  share  on the  1998  Series  A  Preferred  Stock  shall
nevertheless be payable on such subsequent  Quarterly Dividend Payment Date. The
Board of  Directors  may fix a record date for the  determination  of holders of
shares of 1998  Series A  Preferred  Stock  entitled  to receive a  dividend  or
distribution declared thereon,  which record date shall be not more than 60 days
prior to the date fixed for the payment thereof.

         (c) Dividends  shall begin to accrue and be  cumulative on  outstanding
shares of 1998 Series A Preferred  Stock from and after the  Quarterly  Dividend
Payment Date next  preceding  the date of original  issue of such shares of 1998
Series A Preferred Stock; provided, however, that dividends on such shares which
are originally  issued after the record date for the determination of holders of
shares of 1998 Series A Preferred Stock entitled to receive a quarterly dividend
and on or prior to the next  succeeding  Quarterly  Dividend  Payment Date shall
begin to accrue and be cumulative from and after such Quarterly Dividend Payment
Date.  Notwithstanding  the  foregoing,  dividends  on shares  of 1998  Series A
Preferred  Stock which are  originally  issued  prior to the record date for the
determination  of holders of shares of 1998 Series A Preferred Stock entitled to
receive a quarterly  dividend on the first Quarterly Dividend Payment Date shall
be calculated as if cumulative from and after the last day of the fiscal quarter
next preceding the date of original issuance of such shares.  Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of 1998 Series A
Preferred Stock in an amount less than the total amount of such dividends at the
time  accrued  and  payable  on such  shares  shall be  allocated  pro rata on a
share-by-share basis among all such shares at the time outstanding.

         (d) So long as any  shares  of the 1998  Series A  Preferred  Stock are
outstanding,  no dividends  or other  distributions  shall be declared,  paid or
distributed,  or set aside for  payment or  distribution,  on the  Common  Stock
unless,  in each case, the dividend required by this Section 2 to be declared on
the 1998 Series A Preferred Stock shall have been declared.

         (e) The holders of the shares of 1998  Series A  Preferred  Stock shall
not be  entitled  to receive  any  dividends  or other  distributions  except as
provided herein.



                                        3

<PAGE>



         Section 3.  Voting Rights.   The holders  of  shares of  1998 Series A 
Preferred Stock shall have the following voting rights:

         (a) Each holder of 1998 Series A Preferred Stock shall be entitled to a
number of votes  equal to the Formula  Number then in effect,  for each share of
1998 Series A Preferred  Stock held of record on each matter on which holders of
the Common Stock or  stockholders  generally  are  entitled to vote,  multiplied
times the maximum number of votes per share which any holder of the Common Stock
or  stockholders  generally then have with respect to such matter  (assuming any
holding  period  or other  requirement  to vote a  greater  number  of shares is
satisfied).

         (b) Except as  otherwise  provided  herein or by  applicable  law,  the
holders of shares of 1998 Series A Preferred  Stock and the holders of shares of
Common  Stock shall vote  together as one class for the election of directors of
the Corporation and on all other matters  submitted to a vote of stockholders of
the Corporation.

         (c) If,  at the time of any  annual  meeting  of  stockholders  for the
election of directors, the equivalent of six quarterly dividends (whether or not
consecutive) payable on any share or shares of 1998 Series A Preferred Stock are
in default,  the number of directors  constituting the Board of Directors of the
Corporation  shall be increased by two. In addition to voting  together with the
holders of Common Stock for the election of other directors of the  Corporation,
the holders of record of the 1998 Series A Preferred Stock, voting separately as
a class to the  exclusion of the holders of Common  Stock,  shall be entitled at
said  meeting  of  stockholders   (and  at  any  subsequent  annual  meeting  of
stockholders),  unless all  dividends  in arrears have been paid or declared and
set apart for payment prior  thereto,  to vote for the election of two directors
of the  Corporation,  the  holders of any 1998  Series A  Preferred  Stock being
entitled to cast a number of votes per share of 1998  Series A  Preferred  Stock
equal to the Formula  Number.  Until the  default in  payments of all  dividends
which  permitted  the  election  of said  directors  shall  cease to exist,  any
director who shall have been so elected pursuant to the next preceding  sentence
may  be  removed  at any  time,  either  with  or  without  cause,  only  by the
affirmative  vote of the holders of the shares of 1998 Series A Preferred  Stock
at the time entitled to cast a majority of the votes entitled to be cast for the
election of any such  director at a special  meeting of such holders  called for
that purpose,  and any vacancy thereby created may be filled by the vote of such
holders.  If and when such default shall cease to exist, the holders of the 1998
Series A  Preferred  Stock shall be divested  of the  foregoing  special  voting
rights,  subject to  revesting  in the event of each and every  subsequent  like
default in payments of dividends.  Upon the termination of the foregoing special
voting  rights,  the  terms of  office  of all  persons  who have  been  elected
directors pursuant to said special voting rights shall forthwith terminate,  and
the number of directors  constituting the Board of Directors shall be reduced by
two. The voting rights  granted by this Section 3(c) shall be in addition to any
other voting rights granted to the holders of the 1998 Series A Preferred  Stock
in this Section 3.

         (d)  Except  as  provided  in  this  Section  3,  in  Section  11 or by
applicable  law,  holders of 1998 Series A Preferred Stock shall have no special
voting rights and their consent shall not be


                                        4

<PAGE>



required  (except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for authorizing or taking any corporate action.

         Section 4.  Certain Restrictions.

         (a) Whenever  quarterly  dividends or other dividends or  distributions
payable on the 1998  Series A  Preferred  Stock as  provided in Section 2 are in
arrears,   thereafter   and  until  all   accrued  and  unpaid   dividends   and
distributions,  whether or not  declared,  on shares of 1998  Series A Preferred
Stock outstanding shall have been paid in full, the Corporation shall not:

                  (i) declare or pay dividends on, make any other  distributions
         on, or redeem or purchase or otherwise  acquire for  consideration  any
         shares  of  stock  ranking  junior  (either  as to  dividends  or  upon
         liquidation,  dissolution or winding up) to the 1998 Series A Preferred
         Stock;

                  (ii)   declare   or  pay   dividends,   or  make   any   other
         distributions, on any shares of stock ranking on a parity (either as to
         dividends or upon liquidation, dissolution or winding up) with the 1998
         Series A Preferred  Stock,  except  dividends  paid ratably on the 1998
         Series A Preferred  Stock and all such parity stock on which  dividends
         are payable or in arrears in  proportion  to the total amounts to which
         the holders of all such shares are then entitled;

                  (iii)   redeem  or   purchase   or   otherwise   acquire   for
         consideration  shares of any stock  ranking  on a parity  (either as to
         dividends or upon liquidation, dissolution or winding up) with the 1998
         Series A Preferred Stock; provided that the Corporation may at any time
         redeem,  purchase or otherwise  acquire shares of any such parity stock
         in exchange for shares of any stock of the  Corporation  ranking junior
         (either as to dividends or upon dissolution, liquidation or winding up)
         to the 1998 Series A Preferred Stock; or

                  (iv)  purchase  or  otherwise  acquire for  consideration  any
         shares of 1998 Series A Preferred Stock, or any shares of stock ranking
         on a  parity  with  the  1998  Series  A  Preferred  Stock,  except  in
         accordance  with a purchase offer made in writing or by publication (as
         determined  by the Board of  Directors)  to all  holders of such shares
         upon such terms as the Board of Directors,  after  consideration of the
         respective   annual  dividend  rates  and  other  relative  rights  and
         preferences of the respective  series and classes,  shall  determine in
         good  faith  will  result  in fair and  equitable  treatment  among the
         respective series or classes.

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



                                        5

<PAGE>



         Section 5.  Reacquired  Shares.  Any shares of 1998  Series A Preferred
Stock  purchased  or  otherwise  acquired  by  the  Corporation  in  any  manner
whatsoever shall be retired and canceled promptly after the acquisition thereof.
All such shares shall upon their  cancellation  become  authorized  but unissued
shares of Preferred Stock,  without designation as to series, and may thereafter
be issued as part of a new series of Preferred  Stock subject to the  conditions
and restrictions on issuance set forth herein, in the Articles of Incorporation,
or in any other Certificate of Designations creating a series of Preferred Stock
or any similar stock of the Corporation or as otherwise required by law.

         Section  6.   Liquidation,   Dissolution   or  Winding   Up.  Upon  the
liquidation,  dissolution or winding up of the Corporation, whether voluntary or
involuntary, no distribution shall be made (i) to the holders of shares of stock
ranking  junior  (either as to dividends  or upon  liquidation,  dissolution  or
winding up) to the 1998 Series A Preferred  Stock  unless,  prior  thereto,  the
holders of shares of 1998 Series A Preferred Stock shall have received an amount
equal to accrued and unpaid dividends and distributions thereon,  whether or not
declared,  to the date of such  payment,  plus an amount equal to the greater of
(x) $1.00 per whole  share and (y) an  aggregate  amount per share  equal to the
Formula  Number  then in  effect  multiplied  times the  aggregate  amount to be
distributed  per share to holders  of Common  Stock,  or (ii) to the  holders of
stock  ranking  on a  parity  (either  as  to  dividends  or  upon  liquidation,
dissolution  or  winding  up) with the 1998  Series A  Preferred  Stock,  except
distributions  made  ratably on the 1998 Series A  Preferred  Stock and all such
parity stock in proportion to the total amounts to which the holders of all such
shares are entitled upon such liquidation, dissolution or winding up.

         Section 7.  Consolidation,  Merger,  etc. In case the Corporation shall
enter into any consolidation,  merger, combination or other transaction in which
the shares of Common  Stock are  exchanged  for or changed  into other  stock or
securities,  cash or any other property, or any combination thereof, then in any
such case the then outstanding  shares of 1998 Series A Preferred Stock shall at
the same time be  similarly  exchanged  for or changed  into an amount per share
equal to the Formula Number then in effect multiplied times the aggregate amount
of stock, securities,  cash or any other property (payable in kind), as the case
may be,  into  which or for which  each share of Common  Stock is  exchanged  or
changed.  In the event  both this  Section 7 and  Section 2 appear to apply to a
transaction, this Section 7 shall control.

         Section 8.  No Redemption; No Sinking Fund.

         (a) The shares of 1998 Series A Preferred Stock shall not be subject to
redemption by the  Corporation;  provided,  however,  that the  Corporation  may
purchase  or  otherwise  acquire  outstanding  shares of 1998 Series A Preferred
Stock in the open  market or by offer to any holder or holders of shares of 1998
Series A Preferred Stock.

         (b) The shares of 1998 Series A Preferred Stock shall not be subject to
or entitled to the operation of a retirement or sinking fund.



                                        6

<PAGE>



         Section 9. Ranking.  The 1998 Series A Preferred Stock shall rank, with
respect to the  payment of  dividends  and as to  distributions  of assets  upon
liquidation,  dissolution or winding up of the Corporation,  junior to all other
series of  Preferred  Stock of the  Corporation,  unless the Board of  Directors
shall  specifically  determine  otherwise in fixing the powers,  preferences and
relative, participating,  optional and other special rights of the shares of any
such other series and the qualifications, limitations and restrictions thereof.

         Section 10. Fractional  Shares. The 1998 Series A Preferred Stock shall
be issuable upon exercise of the Rights issued pursuant to the Rights  Agreement
in whole  shares or in any  fraction of a share that is one  one-hundredth  of a
share or any integral  multiple of such fraction which shall entitle the holder,
in proportion to such holder's fractional shares, to receive dividends, exercise
voting rights, participate in distributions and to have the benefit of all other
rights of  holders  of 1998  Series A  Preferred  Stock.  In lieu of  fractional
shares, the Corporation, prior to the first issuance of a share or a fraction of
a share of 1998 Series A Preferred  Stock,  may elect (i) to make a cash payment
as  provided in the Rights  Agreement  for  fractions  of a share other than one
one-hundredth  of a share  or any  integral  multiple  thereof  or (ii) to issue
depository  receipts  evidencing  such  authorized  fraction  of a share of 1998
Series A  Preferred  Stock  pursuant  to an  appropriate  agreement  between the
Corporation  and a depository  selected by the  Corporation;  provided that such
agreement shall provide that the holders of such depository  receipts shall have
all the rights, privileges and preferences to which they are entitled as holders
of the 1998 Series A Preferred Stock.

         Section 11.  Amendment.  None of the powers,  preferences  or relative,
participating,  optional or other special  rights of the 1998 Series A Preferred
Stock as provided herein or in the Articles of  Incorporation of the Corporation
shall  be  amended  in any  manner  that  would  alter  or  change  the  powers,
preferences,  rights or  privileges  of the  holders of 1998  Series A Preferred
Stock so as to affect them adversely without the affirmative vote of the holders
of at least 66-2/3 percent of the outstanding  shares of 1998 Series A Preferred
Stock, voting as a separate class.

         IN WITNESS  WHEREOF,  the  Corporation  has caused this  Certificate of
Designations  to be duly  executed  in its  corporate  name  on this  7th day of
January 20, 1998.

                                            MAGNUM HUNTER RESOURCES, INC.


                                            By
                                                Gary C. Evans
                                                President and CEO


                                            By
                                                Morgan F. Johnston
                                                Secretary



                                        7

<PAGE>



COUNTY OF DALLAS   ss.
                   ss.
STATE OF TEXAS     ss.

Before me, the undersigned  authority,  personally appeared Gary C. Evans, known
to me to be the identical person who signed the name of the maker thereof to the
within and foregoing instrument as President and CEO of Magnum Hunter Resources,
Inc.  and that he  acknowledged  to me that he executed the same as his free and
voluntary  act and  deed  and as the  free  and  voluntary  act and deed of said
corporation, for the purposes therein expressed.

Subscribed and sworn to before me on this ___ day of January, 1998.

MY COMMISSION EXPIRES:                         NOTARY PUBLIC


-------------------------                     -------------------------
(SEAL)                                        In and for the State of Texas


                                        8

<PAGE>

                                  EXHIBIT "B"

<PAGE>

                              

                           [Form of Right Certificate]

Certificate No. R-                                      _________ Rights


NOT  EXERCISABLE  AFTER JANUARY 20, 2008, OR EARLIER IF REDEEMED BY THE COMPANY.
THE RIGHTS ARE SUBJECT TO REDEMPTION,  AT THE OPTION OF THE COMPANY, AT $.01 PER
RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.  RIGHTS BENEFICIALLY OWNED
BY AN ACQUIRING  PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING  PERSON (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS  AGREEMENT) AND BY ANY SUBSEQUENT HOLDER OF
SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

                                Right Certificate

                          MAGNUM HUNTER RESOURCES, 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  January  6,  1998,  (the  "Rights  Agreement"),  between  Magnum  Hunter
Resources,  Inc., a Nevada corporation (the "Company"),  and Securities Transfer
Corporation,  as Rights Agent (the "Rights Agent"),  unless the Rights evidenced
hereby have been  previously  redeemed  by the  Company,  to  purchase  from the
Company  at any time  after the  Distribution  Date (as  defined  in the  Rights
Agreement)  and prior to 5:00 P.M., New York City time, on January 20, 2008 (the
"Final Expiration Date"), at the principal office or agency of the Rights Agent,
or its successors as Rights Agent, in the City of New York, one one-hundredth of
a fully paid,  nonassessable  share of Series A Junior  Participating  Preferred
Stock, par value $1.00 per share, of the Company (the "Preferred Shares"),  at a
purchase price per one one-hundredth of a share equal to $_______ (the "Purchase
Price"), upon presentation and surrender of this Right Certificate with the Form
of Election to Purchase duly executed.

         The  Purchase  Price  and the  number  and kind of  shares  that may be
purchased upon exercise of each Right  evidenced by this Right  Certificate,  as
set forth above,  are the Purchase  Price and the number and kind of shares that
may  be  purchased  as of  _____________,  19__  . As  provided  in  the  Rights
Agreement,  the  Purchase  Price and the number  and kind of shares  that may be
purchased  upon the exercise of each Right  evidenced by this Right  Certificate
are subject to modification and adjustment upon the happening of certain events.

         This Right  Certificate  is subject  to all 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
reference to the Rights Agreement is hereby made for a full

                                       B-1

<PAGE>



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
above-mentioned  office and agency of the  Rights  Agent and are also  available
from the Company upon request.

         If the  Rights  evidenced  by this  Right  Certificate  are at any time
beneficially  owned by an  Acquiring  Person or an  Associate or Affiliate of an
Acquiring  Person (as such terms are  defined  in the  Rights  Agreement),  such
Rights  shall be null and void and  nontransferable  and the  holder of any such
Right (including any purported  transferee or subsequent  holder) shall not have
any right to exercise or transfer any such Right.

         This Right Certificate, with or without other Right Certificates,  upon
surrender  at the  principal  stock  transfer or  corporate  trust 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 and kind of 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.

         Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Right  Certificate  may be  redeemed  by the  Company at its option at a
redemption  price (in cash or shares of Common Stock or other  securities of the
Company  deemed  by the  Board  of  Directors  of  the  Company  to be at  least
equivalent  in  value)  of $.01  per  Right  (which  amount  may be  subject  to
adjustment as provided in the Rights Agreement) at any time prior to the earlier
of (i) the close of business on the tenth day following the first date of public
announcement by the Company or an Acquiring  Person that an Acquiring Person has
become such and (ii) the Final Expiration Date. From and after the time that any
person  becomes an  Acquiring  Person,  the  decision to redeem the Rights shall
require the concurrence or a majority of the Continuing Directors (as defined in
the Rights Agreement).

         The Company may,  but shall not be required  to,  issue  fractions of a
Preferred  Share  (other  than one  one-hundredth  of a  Preferred  Share or any
integral multiple thereof) or distribute  certificates  which evidence fractions
of a Preferred Share upon the exercise of any Right or Rights evidenced  hereby.
In lieu of  issuing  fractional  shares,  the  Company  may elect to make a cash
payment as provided in the Rights  Agreement for fractions of a share other than
one  one-hundredth  of a share  or any  integral  multiple  thereof  or to issue
certificates or utilize a depository arrangement as provided in the terms of the
Rights Agreement and the Preferred Shares.

         No holder of this Right Certificate, as such, shall be entitled to vote
or receive dividends or be deemed, for any purpose,  the holder of the Preferred
Shares or 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 stockholder of the Company,  including,  without  limitation,  any right to
vote for the  election  of  directors  or upon any  other  matter  submitted  to
stockholders at any meeting thereof,

                                       B-2

<PAGE>



or to give or withhold consent to any corporate  action, or to receive notice of
meetings  or other  actions  affecting  stockholders  (except as provided in the
Rights   Agreement),   or  to  receive  dividends  or  other   distributions  or
subscription  rights, or otherwise,  until the Right or Rights evidenced by this
Right  Certificate  shall have been exercised as provided in accordance with the
provisions of 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:


[CORPORATE SEAL]



ATTEST:                                MAGNUM HUNTER RESOURCES, INC.


                                       By:
Name:                                Name:
Title:                              Title:

Countersigned:

SECURITIES TRANSFER CORPORATION


By
      Authorized Signature


                                       B-3

<PAGE>



                     [On 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:

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

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

Signature Guaranteed:

         Signatures must be guaranteed by a participant in a Securities Transfer
Association recognized signature program.

                             Certification of Status

         The  undersigned  hereby  certifies by checking the  appropriate  boxes
that:

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

         (2) after due inquiry and to the best knowledge of the undersigned,  it
    did did not acquire the Rights evidenced by this Right  Certificate from any
    person who is, was or
subsequently became an Acquiring Person or an Affiliate or Associate thereof (as
such terms are defined in the Rights Agreement).



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

Dated:_________________


                                       B-4

<PAGE>



               [On Reverse Side of Right Certificate -- continued]

                          FORM OF ELECTION TO PURCHASE

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

To:      MAGNUM HUNTER RESOURCES, INC.

         The   undersigned   hereby   irrevocably   elects  to  exercise  Rights
represented by this Right Certificate to purchase the Preferred Shares (or other
shares) issuable upon the exercise of such Rights and requests that certificates
for such 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:

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


                                       B-5

<PAGE>


               [On Reverse Side of Right Certificate -- continued]

Signature Guaranteed:

         Signatures must be guaranteed by a participant in a Securities Transfer
Association recognized signature program.

                             Certification of Status

         The  undersigned  hereby  certifies by checking the  appropriate  boxes
that:

         (1) this Right Certificate is is not being exercised by or on behalf of
a Person  who is or was an Acquiring Person or an Affiliate or Associate thereof
(as such terms are defined in the Rights Agreement); and

         (2) after due inquiry and to the best knowledge of the undersigned,  it
    did did not acquire the Rights evidenced by this Right  Certificate from any
    person who is, was
or subsequently  became an Acquiring Person or an Affiliate or Associate thereof
(as such terms are defined in the Rights Agreement).



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

Dated:---------------------



                                     NOTICE

         The  signature  in the  Form  of  Assignment  or Form  of  Election  to
Purchase,  as the case may be, 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 of Status 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 such  terms  are  defined  in the  Rights
Agreement) and such Assignment or Election to Purchase will not be honored.

                                       B-6

<PAGE>


                                  EXHIBIT "C"
<PAGE>

                          SUMMARY OF RIGHTS TO PURCHASE
                                PREFERRED SHARES

         On January 7, 1998, the Board of Directors of Magnum Hunter  Resources,
Inc. (the "Company") authorized and declared a dividend of one Right (a "Right")
for each  outstanding  share of Common Stock,  par value$.002 per share ("Common
Stock"),  of the  Company  (the  "Common  Shares").  The  dividend is payable on
January  20,  1998 (the  "Record  Date") to the  holders of record of the Common
Shares at the close of  business  on that date.  In  addition,  the  Company has
authorized  the issuance of one Right with respect to each share of Common Stock
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).  When  exercisable  each  Right  entitles  the
registered  holder to purchase from the Company one  one-hundredth of a share of
1998 Series A Junior Participating  Preferred Stock, par value $0.001 per share,
of  the  Company  (the  "Preferred  Shares"),  at a  price  of  $35.00  per  one
one-hundredth  of  a  Preferred  Share  (the  "Purchase   Price"),   subject  to
adjustment.  The  description  and terms of the Rights are set forth in a Rights
Agreement (the "Rights  Agreement")  between the Company and Securities Transfer
Corporation, 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 (an
"Acquiring Person") has acquired  beneficial  ownership of 15 percent or more of
the  outstanding  Common Shares and (ii) 10 business days (or such later date as
may be  determined  by action of the Board of Directors of the Company  prior to
such time as any person or group of affiliated or associated  persons becomes an
Acquiring Person) following the commencement of, or first public announcement of
an intention to commence,  a tender offer or exchange offer the  consummation of
which  would  result  in the  beneficial  ownership  by a  person  or  group  of
affiliated or associated persons of 15 percent or more of the outstanding Common
Shares (the earlier of such dates being herein referred to as 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
with a copy of this Summary of Rights attached thereto.

         The Rights Agreement  provides that,  until the  Distribution  Date (or
earlier redemption or expiration of the Rights),  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 on or
after the Record Date,  even without such  notation or a copy of this Summary of
Rights being attached  thereto,  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")


                                        1

<PAGE>



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 January 20, 2008 (the "Final Expiration Date"),  unless the Final
Expiration  Date is  extended  or unless  the  Rights are  earlier  redeemed  or
exchanged by the Company, in each case, as described below.

         The Purchase Price payable, and the number of Preferred 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 Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of certain rights
or  warrants  to  subscribe  for or  purchase  Preferred  Shares at a price,  or
securities  convertible into Preferred Shares with a conversion price, less than
the  then  current  market  price of the  Preferred  Shares  or  (iii)  upon the
distribution to holders of the Preferred  Shares of evidences of indebtedness or
assets  (excluding  regular  periodic  cash  dividends  paid out of  earnings or
retained  earnings or dividends  payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).

         The number of outstanding  Rights and the number of one  one-hundredths
of a Preferred  Share  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.

         Preferred  Shares  purchasable  upon exercise of the Rights will not be
subject to redemption by the Company. Each Preferred Share will be entitled to a
minimum  preferential  quarterly  dividend payment of $.01 per share but will be
entitled to an aggregate  dividend of 100 multiplied times the dividend declared
per Common  Share.  In the event of  liquidation,  the  holder of the  Preferred
Shares will be entitled to a minimum  preferential  liquidation payment of $1.00
per share but will be entitled to an aggregate  payment of 100 multiplied  times
the payment made per Common  Share.  Each  Preferred  Share will have 100 votes,
voting  together with the Common  Shares.  Finally,  in the event of any merger,
consolidation  or other  transaction in which Common Shares are exchanged,  each
Preferred  Share will be  entitled to receive  100  multiplied  times the amount
received per Common Share. These rights are protected by customary  antidilution
provisions.

         Because of the nature of the Preferred  Shares'  dividend,  liquidation
and voting rights,  the value of the one  one-hundredth  interest in a Preferred
Share  purchasable  upon exercise of each Right should  approximate the value of
one Common Share.

         In the event that the Company is acquired in a merger or other business
combination  transaction  or 50  percent or more of its  consolidated  assets or
earning  power are sold  after a person  or group of  affiliated  or  associated
persons has become an Acquiring Person, proper


                                        2

<PAGE>



provision will be made so that each holder of a Right will  thereafter  have the
right to receive,  upon the exercise  thereof at the then current exercise price
of the Right,  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
exercise price of the Right. In the event that any person or group of affiliated
or associated  persons becomes an Acquiring  Person,  proper  provision shall be
made so that each holder of a Right, other than Rights beneficially owned by the
Acquiring  Person (which will thereafter be null and void and  nontransferable),
will  thereafter  have the right to receive upon  exercise that number of Common
Shares of the Company  having a market value of two times the exercise  price of
the Right.

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

         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.  The Company may, but shall not be required to,
issue  fractions  of a  Preferred  Share  (other  than  one  one-hundredth  of a
Preferred Share or any integral multiple thereof,  which may, at the election of
the Company,  be evidenced  by  depositary  receipts)  and in lieu  thereof,  an
adjustment  in cash  will be made  based on the  market  price of the  Preferred
Shares on the last trading day prior to the date of exercise.

         At any time prior to the close of business on the tenth day following a
public  announcement  that an  Acquiring  Person  has become  such an  Acquiring
Person,  the Board of  Directors  of the Company may redeem the Rights in whole,
but not in part, at a price of $.01 per Right (the "Redemption Price"). From and
after the time that any person  becomes an  Acquiring  Person,  the  decision to
redeem the Rights  shall  require the  concurrence  of a majority of  Continuing
Directors.  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.  The time at which the  Rights are  redeemed  by the
Company is herein referred to as the  "Redemption  Date."  Immediately  upon any
redemption  of the Rights,  the right to exercise the Rights will  terminate and
the only  right  thereafter  of the  holders of Rights  will be to  receive  the
Redemption Price.

         The term  "Continuing  Directors"  means  any  member  of the  Board of
Directors  of the  Company  who was a member of the Board prior to the time that
any person  became an  Acquiring  Person,  and any  person  who is  subsequently
elected to the Board if such person is  recommended or approved by a majority of
the  Continuing  Directors,  but shall not include an  Acquiring  Person,  or an
affiliate  or associate of an Acquiring  Person,  or any  representative  of the
foregoing entities.



                                        3

<PAGE>


         At any time prior to the Distribution  Date and subject to the last two
sentences of this paragraph, 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 without limitation an amendment to lower certain thresholds  described
above  to not less  than the  greater  of (i) the sum of 0.001  percent  and the
largest percentage of the outstanding Common Shares then known by the Company to
be beneficially owned by any person or group of affiliated or associated persons
and (ii) 10  percent.  From and  after  the  Distribution  Date and  subject  to
applicable law, 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 to, among other
things,  make any  other  provisions  in  regard to  matters  under  the  Rights
Agreement  that the Company may deem  necessary or desirable  and that shall not
adversely  affect the  interests  of the  holders of the Rights  (other  than an
Acquiring Person or an affiliate or associate of an Acquiring Person). The terms
of the Rights may not be amended to (i) reduce the  Redemption  Price (except as
required  by  antidilution  provisions)  or (ii)  provide  for an earlier  Final
Expiration  Date.  From and after such time as any person or group of affiliated
or associated  persons  becomes an Acquiring  Person any amendment or supplement
must be approved by a majority of Continuing Directors.

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

         The  Preferred  Shares  shall  rank,  with  respect  to the  payment of
dividends and as to  distributions  of assets upon  liquidation,  dissolution or
winding up of the Company,  junior to all other series of preferred stock of the
Company,  unless  the  Board of  Directors  of the  Company  shall  specifically
determine   otherwise   in  fixing  the  powers,   preferences   and   relative,
participating, optional and other special rights of the shares of any such other
series and the qualifications, limitations and restrictions thereof.

         A copy of the Rights  Agreement has been filed with the  Securities and
Exchange Commission as an Exhibit to a Form 8-K dated January 7, 1997. 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.



                                        4