Exhibit 4.1


 


MATTSON TECHNOLOGY, INC.


 


AND


 


MELLON INVESTOR SERVICES, LLC


 


as Rights Agent


 


 


RIGHTS AGREEMENT


 


Dated as of July 28, 2005


 





















 


TABLE OF CONTENTS


 


	
  1.

  	
  Certain Definitions

  	
  1

  
	
  2.

  	
  Appointment of Rights Agent

  	
  6

  
	
  3.

  	
  Issuance of Right
  Certificates

  	
  6

  
	
  4.

  	
  Form of Right
  Certificates

  	
  8

  
	
  5.

  	
  Countersignature and
  Registration

  	
  9

  
	
  6.

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

  	
  9

  
	
  7.

  	
  Exercise
  of Rights; Purchase Price; Expiration Date of Rights

  	
  10

  
	
  8.

  	
  Cancellation
  and Destruction of Right Certificates

  	
  11

  
	
  9.

  	
  Reservation
  and Availability of Shares of Preferred Stock

  	
  12

  
	
  10.

  	
  Preferred Stock Record Date

  	
  13

  
	
  11.

  	
  Adjustments
  to Number and Kind of Shares, Number of Rights or Purchase Price

  	
  13

  
	
  12.

  	
  Certification of
  Adjustments

  	
  22

  
	
  13.

  	
  Consolidation,
  Merger or Sale or Transfer of Assets or Earning Power

  	
  22

  
	
  14.

  	
  Fractional
  Rights and Fractional Shares

  	
  26

  
	
  15.

  	
  Rights of Action

  	
  27

  
	
  16.

  	
  Agreement of Right Holders

  	
  27

  
	
  17.

  	
  Right
  Certificate Holder Not Deemed a Stockholder

  	
  28

  
	
  18.

  	
  Concerning the Rights Agent

  	
  28

  
	
  19.

  	
  Merger
  or Consolidation or Changed Name of Rights Agent

  	
  29

  
	
  20.

  	
  Duties of Rights Agent

  	
  29

  
	
  21.

  	
  Change of Rights Agent

  	
  31

  
	
  22.

  	
  Issuance of New
  Right Certificates

  	
  32

  
	
  23.

  	
  Redemption

  	
  33

  
	
  24.

  	
  Exchange of Rights
  for Common Stock

  	
  33

  
	
  25.

  	
  Notice of Proposed Actions

  	
  35

  
	
  26.

  	
  Notices

  	
  35

  
	
  27.

  	
  Supplements and Amendments

  	
  36

  
	
  28.

  	
  Successors

  	
  37

  
	
  29.

  	
  Benefits of this
  Rights Agreement

  	
  37

  



 


i





















 


	
  30.

  	
  Determinations and Actions by
  the Board of Directors

  	
  37

  
	
  31.

  	
  Governing Law

  	
  37

  
	
  32.

  	
  Counterparts

  	
  37

  
	
  33.

  	
  Descriptive Headings

  	
  37

  
	
  34.

  	
  Severability

  	
  37

  



 


ii





















 


RIGHTS
AGREEMENT


 


This
Rights Agreement (“Rights Agreement”), is dated as of July 28, 2005,
between Mattson Technology, Inc., a Delaware corporation (the “Company”),
and Mellon Investor Services, LLC, a New Jersey limited liability company, as
rights agent (the “Rights Agent”).


 


W  I
T  N  E  S  S  E  T  H:


 


WHEREAS,
the Board of Directors of the Company on July 28, 2005 (i) authorized
the issuance and declared a dividend of one right (“Right”) for each share of
the common stock, par value $0.001 per share, of the Company outstanding as of
the Close of Business (as such term is hereinafter defined) on August 15,
2005 (the “Record Date”), each Right representing the right to purchase one one-thousandth of a share of Series A Preferred Stock of the
Company having the rights, powers and preferences set forth in the form of
Certificate of Designation attached hereto as Exhibit A upon the terms and
subject to the conditions hereinafter set forth, and (ii) further
authorized the issuance of one Right with respect to each share of Common Stock
of the Company that shall become outstanding between the Record Date, and the Distribution Date (as such term is
hereinafter defined);


 


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


 


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


 


(a)                                  “Acquiring
Person” shall mean any Person (as such term is hereinafter defined) who or
which, together with all Affiliates (as such term is hereinafter defined) and
Associates (as such term is hereinafter defined) of such Person shall be the
Beneficial Owner (as such term is hereinafter defined) of fifteen percent (15%)
or more of the outstanding Common Stock of the Company, without the prior
approval of the Company’s Board of Directors; provided, however, that in no
event shall a Person who or which, together with all Affiliates and Associates
of such Person, is the Beneficial Owner of less than 15% of the Company’s
outstanding Common Stock, become an Acquiring Person solely as a result of a
reduction of the number of shares of outstanding Common Stock, including
repurchases of outstanding shares of Common Stock by the Company, which
reduction increases the percentage of outstanding shares of Common Stock
beneficially owned by such Person, provided, further, that if a
Person shall become the Beneficial Owner of 15% or more of the Company’s
outstanding Common Stock then outstanding solely by reason of a reduction of
the number of shares of outstanding Common Stock, and shall thereafter become
the Beneficial Owner of any additional shares of Common Stock of the Company,
then such Person shall be deemed to be an Acquiring Person unless upon the
consummation of the acquisition of such additional shares of Common Stock such
person does not own 15% or more of the shares of Common Stock then
outstanding.  An Acquiring Person shall
not include an Exempt Person (as such term is hereinafter defined) or a
Grandfathered Person (as such term is hereinafter defined); provided further
that a Grandfathered Person shall become an Acquiring Person if, (i) without
the prior approval of the Board of Directors, the Grandfathered Person becomes
the Beneficial Owner of an additional number of


 





















 


shares, in addition to
such Grandfathered Person’s shares of Common Stock Beneficially owned on the
Record Date, equal in the aggregate to 1% or more of the Common Stock then
outstanding, or (ii) in any event, if such Grandfathered Person becomes
the Beneficial Owner of 19% or more of the Company’s Common Stock; but (iii) the
Grandfathered Person shall not become an Acquiring Person solely by reason of a
reduction of the number of shares of outstanding Common Stock.  Notwithstanding the foregoing, if (i) either
(X) the Board of Directors of the Company determines in good faith that a
Person who would otherwise be an Acquiring Person, as defined pursuant to the
foregoing provisions of this paragraph (a), has become such inadvertently
(including, without limitation, because (A) such Person was unaware that
it beneficially owned a percentage of Common Stock that would otherwise cause
such Person to be an Acquiring Person or (B) such Person was aware of the
extent of its Beneficial Ownership but had no actual knowledge of the
consequences of such Beneficial Ownership under this Rights Agreement) and
without any intention of changing or influencing control of the Company, or
(Y) within two Business Days of being requested by the Company to advise
the Company regarding same, such Person certifies in writing that such Person
acquired Beneficial Ownership of 15% or more of the Company’s outstanding
Common Stock inadvertently or without knowledge of the terms of the Rights, and
(ii) such Person divests as promptly as practicable a sufficient number of
shares of Common Stock so that such Person would no longer be an “Acquiring
Person,” as defined pursuant to the foregoing provisions of this
paragraph (a), then such Person shall not be deemed to be or to have
become an “Acquiring Person” for any purposes of this Rights Agreement.


 


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


 


(c)                                  A
Person shall be deemed the “Beneficial Owner” 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, directly or
indirectly, 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), whether or not in writing, 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 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 or dispose of or has “beneficial
ownership” of (as determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act, or any comparable or successor rule),
including pursuant to any agreement, arrangement or understanding (whether or
not in writing); provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to “beneficially own”, any securities if the agreement,
arrangement or understanding to vote such security (1) arises solely from
a revocable proxy or consent given in response to a public proxy or consent
solicitation


 


2





















 


made pursuant to, and in
accordance with, the applicable rules and regulations of the Exchange Act
and (2) is not also then reportable by such Person on Schedule 13D
under the Exchange Act (or any comparable or successor report); or


 


(iii)                               which
are beneficially owned, directly or indirectly, by any other Person with which
such Person or any of such Person’s Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the purpose of
acquiring, holding, voting except as described in the proviso to clause (B) of
subparagraph (ii) of this Section 1(c) or disposing of any
securities of the Company; provided, however, that no Person who
is an officer, director or employee of an Exempt Person shall be deemed, solely
by reason of such Person’s status or authority as such, to be the Beneficial
Owner of, to have “beneficial ownership” of or to “beneficially own” any
securities that are “beneficially owned” (as defined in this Section 1(c)),
including, without limitation, in a fiduciary capacity, by an Exempt Person or
by any other such officer, director or employee of an Exempt Person.


 


For
all purposes of this Rights Agreement, any calculation of the number of shares
of Common Stock outstanding at any particular time, including any calculation
for purposes of determining the particular percentage of such outstanding
shares of Common Stock of which any Person is the Beneficial Owner, shall be
made in accordance with the last sentence of Rule 13d-3(d)(1)(i) of
the General Rules and Regulations under the Exchange Act as in effect on
the date hereof.


 


(d)                                 “Board
of Directors” shall mean the Company’s Board of Directors.


 


(e)                                  “Business
Day” shall mean any day other than a Saturday, Sunday, or a day on which the
New York Stock Exchange or banking institutions in the State of New York or the State of New Jersey or the State of California
are authorized or obligated by law or executive order to close.


 


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


 


(g)                                 “Common
Stock” when used with reference to the Company shall mean the common stock, par
value $0.001 per share, of the Company.  “Common
Stock” when used with reference to any Person other than the Company which
shall be organized in corporate form shall mean the capital stock or other
equity security with the greatest per share voting power of such Person or, if
such Person is a Subsidiary of or is controlled by another Person, the Person
which ultimately controls such first-mentioned Person.  “Common Stock” when used with reference to
any Person other than the Company which shall not be organized in corporate
form shall mean units of beneficial interest which shall represent the right to
participate in profits, losses, deductions and credits of such Person and which
shall be entitled to exercise the greatest voting power per unit of such
Person.


 


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


 


(i)                                     “Company”
shall have the meaning set forth in the preamble hereto.


 


3





















 


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


 


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


 


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


 


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


 


(n)                                 “Exempt
Person” shall mean the Company or any Subsidiary of the Company, including,
without limitation, in its fiduciary capacity, any employee benefit plan or
employee or director stock plan of the Company or of any Subsidiary of the
Company, or any Person, organized, appointed, established or holding Common
Stock for or pursuant to the terms of any such plan or any Person funding other
employee benefits for employees of the Company or any Subsidiary of the
Company.


 


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


 


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


 


(q)                                 “Flip-In
Event” shall mean any event described in Section 11(a)(ii)(A), 11(a)(ii)(B) or
11(a)(ii)(C) hereof.


 


(r)                                    “Flip-In
Exercise Payment” shall have the meaning set forth in Section 11(a)(ii) hereof.


 


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


 


(t)                                    “Flip-Over
Event” shall mean any event described in clause (x), (y) or (z) of Section 13(a) hereof.


 


(u)                                 “Flip-Over
Exercise Payment” shall have the meaning set forth in Section 13(a) hereof.


 


(v)                                 “Grandfathered
Person” shall mean NWQ Investment Management Company, LLC, provided that such
Person shall cease to be a Grandfathered Person at such time as such Person
ceases to Beneficially Own in excess of 15% of the Company’s Common Stock.


 


(w)                               “NASDAQ”
shall have the meaning set forth in Section 9(b) hereof.


 


(x)                                   “Person”
shall mean any individual, firm, corporation, partnership, trust, limited
liability company or other entity, and shall include any successor (by merger
or otherwise) thereof or thereto.


 


4





















 


(y)                                 “Preferred
Stock” shall mean the Series A
Preferred Stock, $0.01 par value, of the Company having the rights, powers and
preferences set forth in Exhibit A hereto, and, to the extent that
there is not a sufficient number of shares of Series A Preferred Stock authorized to permit the full
exercise of the Rights, any other series of Preferred Stock, $0.01 par value,
of the Company designated for such purpose containing terms substantially
similar to the terms of the Series A
Preferred Stock.


 


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


 


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


 


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


 


(cc)                            “Record
Date” shall have the meaning set forth in the Recitals within this Rights
Agreement.


 


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


 


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


 


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


 


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


 


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


 


(ii)                                  “Stock
Acquisition Date” shall mean the first date of public announcement by the
Company or an Acquiring Person that an Acquiring Person has become such or such
earlier date as a majority of the directors shall become aware of the existence
of an Acquiring Person.


 


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


 


(kk)                            “Subsidiary”
of a Person shall mean any corporation or other entity of which securities or
other ownership interests having ordinary voting power sufficient to elect a
majority of the board of directors or other persons performing similar
functions are beneficially owned, directly or indirectly, by such Person and
any corporation or other entity that is otherwise controlled by such Person.


 


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


 


(mm)                      “Trading
Day” shall mean a day on which the principal national securities exchange on
which the shares of Common Stock are listed or admitted to trading is open for
the


 


5





















 


transaction of business
or, if the shares of Common Stock are not listed or admitted to trading on any
national securities exchange, a Business Day.


 


(nn)                          “Triggering
Event” shall mean any event described in Section 11(a)(ii)(A), 11(a)(ii)(B) or
11(a)(ii)(C) or Section 13 hereof.


 


(oo)                          “Voting
Power” shall mean the voting power of all securities of the Company then
outstanding and generally entitled to vote for the election of directors of the
Company.


 


Any
determination required by the definitions contained in this Section 1
shall be made by the Board of Directors in its good faith judgment, which
determination shall be binding on the Rights Agent and the holders of the
Rights.


 


2.                                       Appointment of Rights Agent.  The Company hereby appoints the Rights Agent
to act as agent for the Company in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such appointment.  The Company may from time to time appoint a
co-Rights Agent as it may deem necessary or desirable.  In the event the Company appoints one or more
co-Rights Agent(s), the respective duties of the Rights Agent and any co-Rights
Agent(s) shall be as the Company shall determine.  The Rights Agent shall have no duty to
supervise, and in no event shall be liable for, the acts or omissions of any
such co-Rights Agent.


 


3.                                       Issuance of Right Certificates.


 


(a)                                  Until
the earlier of (i) the Stock Acquisition Date (or, if the Stock
Acquisition Date occurs before the Record Date, the Close of Business on the
Record Date) or (ii) the tenth Business Day (or such later date as may be
determined by action of the Board of Directors prior to such time as any Person
becomes an Acquiring Person) after the date of the commencement by any Person
(other than an Exempt Person) of, or of the first public announcement of the
intent of any Person (other than an Exempt Person) to commence (which intention
to commence remains in effect for five business days after such announcement),
a tender or exchange offer upon the successful consummation of which such
Person, together with its Affiliates and Associates, would be the Beneficial
Owner of 15% or more of the outstanding Common Stock (irrespective of whether
any shares are actually purchased pursuant to any such offer) (including any
such date which is after the date of this Rights Agreement and prior to the
issuance of the Rights; the earlier of such dates being herein referred to as
the “Distribution Date”), (x) the Rights will be evidenced (subject to the
provisions of Section 3(c) hereof) by the certificates for the Common
Stock registered in the names of the holders of the Common Stock and not by
separate Right Certificates, and (y) each Right will be transferable only
in connection with the transfer of a share (subject to adjustment as
hereinafter provided) of Common Stock. 
As soon as practicable after the Distribution Date and receipt by the
Rights Agent of a list of the record holders of the Common Stock and all other
relevant information, the Rights Agent will, if requested, mail, by
first-class, postage prepaid mail, to each record holder of the Common Stock as
of the Close of Business on the Distribution Date, as shown by the records of
the Company, to the address of such holder shown on such records, a Right
certificate in substantially the form of Exhibit B hereto (a “Right
Certificate”) evidencing one Right for each share of Common Stock


 


6





















 


so held.  As of and after the Distribution Date the
Rights will be evidenced solely by such Right Certificates.


 


The
Company shall promptly notify the Rights Agent in writing upon the occurrence
of the Distribution Date and, if such notification is given orally, the Company
shall confirm same in writing on or prior to the Business Day next
following.  Until such notice is received
by the Rights Agent, the Rights Agent may presume conclusively for all purposes
that the Distribution Date has not occurred.


 


(b)                                 On
the Record Date, or as soon as practicable thereafter, the Company will send a
copy of a Summary of Rights to Purchase Preferred Stock, substantially in the
form attached hereto as Exhibit C (a “Summary of Rights”), by
first-class, postage prepaid mail, to each record holder of Common Stock as of
the Close of Business on the Record Date, at the address of such holder shown
on the records of the Company.


 


(c)                                  Rights
shall be issued in respect of all shares of Common Stock that are issued
(either as an original issuance or from the Company’s treasury) after the
Record Date prior to the earlier of the Distribution Date or the Expiration
Date.  With respect to certificates
representing such shares of Common Stock, the Rights will be evidenced by such
certificates for Common Stock registered in the names of the holders thereof
together with the Summary of Rights. 
Until the Distribution Date (or, if earlier, the Expiration Date), the
surrender for transfer of any certificate for Common Stock outstanding on the
Record Date (with or without a copy of the Summary of Rights attached thereto),
shall also constitute the surrender for transfer of the Rights associated with
the Common Stock represented thereby.


 


(d)                                 Certificates
issued for Common Stock (including, without limitation, certificates issued
upon transfer or exchange of Common Stock) after the Record Date but prior to
the earlier of the Distribution Date or the Expiration Date shall have
impressed on, printed on, written on or otherwise affixed to them a legend in
substantially the following form:


 


This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in the Rights Agreement between Mattson Technology, Inc. and
Mellon Investor Services, LLC, as Rights Agent, dated as of July 28, 2005,
as the same may be amended from time to time (the “Rights Agreement”), the
terms of which are incorporated herein by reference and a copy of which is on
file at the principal executive office of Mattson Technology, Inc. 
Under certain circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate certificates and will no longer be
evidenced by this certificate.  Mattson Technology, Inc. will
mail to the holder of this certificate a copy of the Rights Agreement without
charge after receipt by it of a written request therefor.  Under certain
circumstances as provided in the Rights Agreement, Rights issued to,
beneficially owned by or transferred to any Person who is or becomes an
Acquiring Person (as such terms are defined in the Rights Agreement) or an
Associate or Affiliate (as such terms are defined in the Rights Agreement)
thereof and certain transferees thereof will be null and void and will no
longer be transferable.


 


With respect to such certificates containing the
foregoing legend, the Rights associated with the Common Stock represented by
such certificates shall, until the Distribution Date, be evidenced


 


7





















 


by such
certificates alone, and registered holders of Common Stock shall also be the
registered holders of the associated Rights, and the surrender for transfer of
any such certificate shall also constitute the surrender for transfer of the
Rights associated with the Common Stock represented thereby.  In the event that the Company purchases or
acquires any shares of Common Stock after the Record Date but prior to the
earlier of the Distribution Date, the Redemption Date or the Expiration Date,
any Rights associated with such shares of Common Stock shall be deemed canceled
and retired so that the Company shall not be entitled to exercise any Rights
associated with the shares of Common Stock no longer outstanding.


 


Notwithstanding
this subsection (d), the omission of a legend shall not affect the
enforceability of any part of this Rights Agreement or the rights of any holder
of the Rights.


 


4.                                       Form of Right Certificates.


 


(a)                                  The
Right Certificates (and the forms of election to purchase shares and of
assignment to be printed on the reverse thereof), when, as and if issued, shall
be substantially in the form set forth in Exhibit B hereto 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 Rights Agreement but which do not
affect the rights, duties or responsibilities of the Rights Agent, or as may be
required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange on
which the Rights may from time to time be listed, or to conform to usage.  Subject to the provisions of Sections 11,
13 and 22 hereof, the Right Certificates evidencing the Rights issued on the
Record Date whenever such certificates are issued, shall be dated as of the
Record Date and the Right Certificates evidencing Rights to holders of record
of Common Stock issued after the Record Date shall be dated as of the Record
Date but shall also be dated to reflect the date of issuance of such Right
Certificate.  On their face, Right
Certificates shall entitle the holders thereof to purchase, for each Right, one one-thousandth of a share of
Preferred Stock, or other securities or property as provided herein, as the
same may from time to time be adjusted as provided herein, at the price per one one-thousandth of a share of
Preferred Stock of $55.00, as the same may from time to time be adjusted as
provided herein (the “Purchase Price”).


 


(b)                                 Notwithstanding
any other provision of this Rights Agreement, any Right Certificate that
represents Rights that are or were at any time on or after the earlier of the
Stock Acquisition Date or the Distribution Date beneficially owned by an
Acquiring Person or any Affiliate or Associate thereof (or any transferee of
such Rights) shall, to the extent the Rights Agent has notice thereof and to
the extent feasible, have impressed on, printed on, written on or otherwise
affixed to it (if the Company or the Rights Agent has knowledge that such
Person is an Acquiring Person or an Associate or Affiliate thereof or
transferee of such Persons or a nominee of any of the foregoing) the following legend:


 


The beneficial owner of the Rights represented by this
Right Certificate is an Acquiring Person or an Affiliate or Associate (as such
terms are defined in the Rights Agreement) of an Acquiring Person or a
subsequent holder of such Right Certificates beneficially owned by such
Persons.  Accordingly, this Right Certificate
and the Rights represented


 


8





















 


hereby are null and void and will no longer be
transferable as provided in the Rights Agreement.


 


The provisions of Section 11(a)(ii) and Section 24
of this Rights Agreement shall be operative whether or not the foregoing legend
is contained on any such Right Certificates.


 


5.                                       Countersignature and Registration.


 


(a)                                  The
Right Certificates shall be executed on behalf of the Company by its Chief
Executive Officer, its President or any Vice President, either manually or by
facsimile signature, and have affixed thereto the Company’s seal or a facsimile
thereof which shall be attested by the Secretary or an Assistant Secretary of
the Company, either manually or by facsimile signature.  The Right Certificates shall be
countersigned, either manually or by facsimile, by the Rights Agent and shall
not be valid for any purpose unless so countersigned.  In case any officer of the Company who shall
have signed any of the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery
by the Company, such Right Certificates, nevertheless, may be countersigned by
the Rights Agent, issued and delivered with the same force and effect as though
the person who signed such Right Certificates had not ceased to be such officer
of the Company; and any Right Certificate may be signed on behalf of the
Company by any person who, at the actual date of the execution of such Right
Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Rights Agreement any
such person was not such an officer.


 


(b)                                 Following
the Distribution Date and receipt by the Rights Agent of notice to that effect
and all other relevant information, the Rights Agent will keep or cause to be
kept, at one of its offices designated for such purposes, records for
registration and transfer of the Right Certificates issued hereunder.  Such records 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 date of
each of the Right Certificates and the certificate numbers for each of the
Right Certificates.


 


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), 11(a)(ii) 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 Expiration Date, any Right Certificate or
Certificates (other than Right Certificates representing Rights that have
become null and void pursuant to Section 11(a)(ii) hereof or that
have been exchanged pursuant to Section 24 hereof) may be (i) transferred
or (ii) split up, combined or exchanged for another Right Certificate or
Right Certificates, entitling the registered holder to purchase a like number
of shares of Preferred Stock or other securities as the Right Certificate or
Right Certificates surrendered then entitled such holder to purchase.  Any registered holder desiring to transfer
any Right Certificate shall surrender the Right Certificate at the office of
the Rights Agent designated for such purposes with the form of assignment on
the reverse side thereof duly endorsed (or enclose with such Right Certificate
a written instrument of transfer in form satisfactory to the Company and the
Rights Agent), duly executed by the


 


9





















 


registered holder thereof
or his attorney duly authorized in writing, and with such signature guaranteed
by a member of a securities approved medallion program.  Any registered holder desiring to split up,
combine or exchange any Right Certificate shall make such request in writing
delivered to the Rights Agent, and shall surrender the Right Certificate or
Right Certificates to be split up, combined or exchanged at the office of the
Rights Agent designated for such purposes. 
Thereupon the Rights Agent shall, subject to Sections 4(b), 7(e),
11 and 14 hereof, countersign (by manual or facsimile signature) and deliver to
the Person entitled thereto a Right Certificate or Right Certificates, as the
case may be, as so requested.  The
Company may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split
up, combination or exchange of Right Certificates.  The Rights Agent shall have no duty or
obligation under this Section unless and until it is satisfied that all
such taxes and/or governmental charges have been paid.


 


(b)                                 Subject
to the provisions of Section 11(a)(ii) hereof, 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, if requested by the Company or the Rights Agent, 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 execute and deliver a new Right
Certificate of like tenor to the Rights Agent for delivery to the registered
owner in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.


 


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


 


(a)                                  Subject
to Section 11(a)(ii) hereof, the Rights shall become exercisable, and
may be exercised to purchase Preferred Stock, 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 and with such signature duly guaranteed,
to the Rights Agent at the office of the Rights Agent designated for such
purpose, together with payment of the Purchase Price with respect to each Right
exercised, subject to adjustment as hereinafter provided, at or prior to the
Close of Business on the earlier of (i) July 27, 2015 (the “Final
Expiration Date”), (ii) the time at which the Rights are redeemed as
provided in Section 23 hereof (such date being herein referred to as the “Redemption
Date”) or (iii) the time at which all such Rights are exchanged as
provided in Section 24 hereof (the earliest of (i), (ii) and (iii) being
herein referred to as the “Expiration Date”).


 


(b)                                 The
Purchase Price and the number of shares of Preferred Stock or other securities
or consideration to be acquired upon exercise of a Right shall be subject to
adjustment from time to time as provided in Sections 11 and 13 hereof.  The Purchase Price shall be payable in lawful
money of the United States of America, in accordance with Section 7(c) hereof.


 


(c)                                  Except
as provided in Section 11(a)(ii) hereof, upon receipt of a Right
Certificate with the form of election to purchase duly executed and properly
completed, accompanied by payment of the Purchase Price (as such amount may be
reduced pursuant to Section 11(a)(iii) hereof) or so much thereof as
is necessary for the shares to be purchased and an amount equal to any
applicable tax or governmental charge, by cash, certified check or official


 


10





















 


bank check payable to the
order of the Company, the Rights Agent shall, subject to Section 20(k)
hereof, thereupon promptly (i) requisition from any transfer agent of the
Preferred Stock (or make available if the Rights Agent is the transfer agent)
certificates for the number of shares of Preferred Stock so elected to be
purchased and the Company will comply and hereby authorizes and directs such
transfer agent to comply with all such requests, (ii) requisition from the
Company the amount of cash to be paid in lieu of issuance of fractional shares
in accordance with Section 14(b) hereof, and (iii) promptly
after receipt of such Preferred Stock certificates cause the same to be
delivered to or upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be designated by such
holder, and, when appropriate, after receipt of the cash requisitioned from the
Company promptly deliver such cash to or upon the order of the registered
holder of such Right Certificate.  In the
event of a purchase of securities, other than Preferred Stock, pursuant to Section 11(a) or
Section 13 hereof, the Rights Agent shall promptly take the appropriate
actions corresponding to the foregoing clauses (i) through
(iii).  In the event that the Company is
obligated to issue other securities of the Company, pay cash and/or distribute
other property pursuant to Section 11(a) hereof, the Company will
make all arrangements necessary so that such other securities, cash and/or
other property are available for distribution by the Rights Agent, if and when
necessary to comply with this Rights Agreement.


 


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


 


(e)                                  Notwithstanding
anything in this Rights Agreement to the contrary, neither the Rights Agent nor
the Company shall be obligated to undertake any action with respect to a
registered holder upon the occurrence of any purported exercise as set forth in
this Section 7 unless such registered holder shall have (i) properly
completed and signed the certificate 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 or the Rights Agent shall reasonably request.


 


8.                                       Cancellation and Destruction of
Right Certificates.  All
Right Certificates surrendered for the purpose of exercise. transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered 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 Rights 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 otherwise than upon the
exercise thereof.  The Rights Agent shall
deliver all canceled Right Certificates to the Company, or shall, at the
written request of the Company, destroy such canceled Right Certificates, and
in such case shall deliver a certificate of destruction thereof to the Company.


 


11





















 


9.                                       Reservation and Availability of
Shares of Preferred Stock.


 


(a)                                  The
Company covenants and agrees that at all times it will cause to be reserved and
kept available, out of and to the extent of its authorized and unissued shares
of Preferred Stock not reserved for another purpose (and, following the
occurrence of a Triggering Event, other securities) or held in its treasury,
the number of shares of Preferred Stock (and, following the occurrence of a
Triggering Event, other securities) that, as provided in this Rights Agreement,
including Section 11(a)(iii) hereof, will be sufficient to permit the
exercise in full of all outstanding Rights; provided, however,
that the Company shall be required to reserve and keep available shares of
Preferred Stock or other securities sufficient to permit the exercise in full
of all outstanding Rights pursuant to the adjustments set forth in Section 11(a)(ii),
Section 11(a)(iii) or Section 13 hereof only if, and to the
extent that, the Rights become exercisable pursuant to such adjustments.


 


(b)                                 The
Company shall (i) use its best efforts to cause, from and after such time
as the Rights become exercisable, the Rights and all shares of Preferred Stock
(and following the occurrence of a Triggering Event, other securities) issued
or reserved for issuance upon exercise thereof to be reported by the National
Association of Securities Dealers, Inc. Automated Quotations System (“NASDAQ”)
or such other system then in use, and if the Preferred Stock shall become
listed on any national securities exchange, to cause, from and after such time
as the Rights become exercisable, the Rights and all shares of Preferred Stock
(and, following the occurrence of a Triggering Event, other securities) issued
or reserved for issuance upon exercise thereof to be listed on such exchange
upon official notice of issuance upon such exercise and (ii) if then
necessary, to permit the offer and issuance of such shares of Preferred Stock
(and, following the occurrence of a Triggering Event, other securities),
register and qualify such share of Preferred Stock (and, following the
occurrence of a Triggering Event, other securities) under the Securities Act
and any applicable state securities or “blue sky” laws (to the extent
exemptions therefrom are not available), cause such registration statement and
qualifications to become effective as soon as possible after such filing and
keep such registration and qualifications effective until the Expiration Date
of the Rights.  The Company may
temporarily suspend, for a period of time not to exceed ninety (90) days, the
exercisability of the Rights in order to prepare and file a registration
statement under the Securities Act and permit it to become effective.  Upon any such suspension, the Company shall
promptly notify the Rights Agent in writing thereof and issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement (with prompt written notice thereof
to the Rights Agent) at such time as the suspension is no longer in
effect.  Notwithstanding any provision of
this Rights Agreement to the contrary, the Rights shall not be exercisable in
any jurisdiction unless the requisite qualification in such jurisdiction shall
have been obtained and until a registration statement under the Securities Act
(if required) shall have been declared effective.


 


(c)                                  The
Company covenants and agrees that it will take all such action as may be
necessary to ensure that all shares of Preferred Stock (and following the
occurrence of a Triggering Event, other securities) delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price in respect thereof), be duly and
validly authorized and issued and fully paid and nonassessable shares in
accordance with applicable law.


 


12





















 


(d)                                 The
Company further covenants and agrees that it will pay when due and payable any
and all taxes and charges which may be payable in respect of the issuance or
delivery of the Right Certificates or of any shares of Preferred Stock (or
other securities, as the case may be) upon the exercise of Rights.  The Company shall not, however, be required to
pay any tax or governmental charge which may be payable in respect of any
transfer or delivery of Right Certificates to a Person other than, or the
issuance or delivery of certificates for Preferred Stock (or other securities,
as the case may be) upon exercise of Rights in a name other than that of, the
registered holder of the Right Certificate, and the Company shall not be
required to issue or deliver a Right Certificate or certificate for Preferred
Stock (or other securities, as the case may be) to a Person other than such
registered holder until any such tax and charge shall have been paid (any such
tax or charge being payable by the holder of such Right Certificate at the time
of surrender) or until it has been established to the Company’s and the Rights
Agent’s satisfaction that no such tax or charge is due.


 


10.                                 Preferred Stock Record Date.  Each Person in whose name any certificate for
shares of Preferred Stock (or other securities, as the case may be) is issued
upon the exercise of Rights shall for all purposes be deemed to have become the
holder of record of the shares of Preferred Stock (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 the Purchase Price (and any applicable taxes or
charges) was made.  Prior to the exercise
of the Rights evidenced thereby, the holder of a Right Certificate, as such, shall
not be entitled to any rights of a stockholder of the Company with respect to
the 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, if any, and shall not be entitled to receive
any notice of any proceedings of the Company, except as provided herein.


 


11.                                 Adjustments to Number and Kind of
Shares, Number of Rights or Purchase Price.  The number and kind of shares subject to purchase
upon the exercise of each Right, the number of Rights outstanding and the
Purchase Price are subject to adjustment from time to time as follows:


 


(a)                                  (i)                                     In
the event the Company shall at any time after the date of this Rights Agreement
(A) declare or pay any dividend on Preferred Stock payable in shares of
Preferred Stock, (B) subdivide or split the outstanding shares of
Preferred Stock into a greater number of shares, (C) combine or
consolidate the outstanding shares of Preferred Stock into a smaller number of
shares or effect a reverse split of the outstanding shares of Preferred Stock,
or (D) issue any shares of its capital stock in a reclassification of the
Preferred Stock (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or surviving
corporation), except as otherwise provided in this Section 11(a), 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 Preferred Stock or capital stock, as the case
may be, issuable on such date, shall be proportionately adjusted so that the
holder of any Right exercised after such time shall be entitled to receive,
upon payment of the Purchase Price then in effect, the aggregate number and
kind of shares of capital stock or other securities, which, if such Right had
been exercised immediately prior to such date, the holder thereof would have
owned upon such exercise and been entitled to receive


 


13





















 


by virtue of such
dividend, subdivision, combination or reclassification.  If an event occurs which 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).


 


(i)                                     Subject
to Section 24, in the event


 


(A)                              any
Acquiring Person or any Associate or Affiliate of any Acquiring Person, at any
time after the date of this Rights Agreement, directly or indirectly, (1) shall
consolidate with or merge with and into the Company or any of its Subsidiaries
or otherwise combine with the Company or any of its Subsidiaries and the
Company or such Subsidiary shall be the continuing or surviving corporation of
such consolidation, merger or combination and the Common Stock of the Company
shall remain outstanding and no shares thereof shall be changed into or
exchanged for stock or other securities of the Company or of any other Person
or cash or any other property, or (2) shall, in one or more transactions,
other than in connection with the exercise of a Right or Rights and other than
in connection with the exercise or conversion of securities exercisable for or
convertible into securities of the Company or of any Subsidiary of the Company,
transfer any assets or property to the Company or any of its Subsidiaries in
exchange (in whole or in part) for any shares of any class of capital stock of
the Company or any of its Subsidiaries or any securities exercisable for or
convertible into shares of any class of capital stock of the Company or any of
its Subsidiaries, or otherwise obtain from the Company or any of its
Subsidiaries, with or without consideration, any additional shares of any class
of capital stock of the Company or any of its Subsidiaries or any securities
exercisable for or convertible into shares of any class of capital stock of the
Company or any of its Subsidiaries (other than as part of a pro rata offer or
distribution by the Company or such Subsidiary to all holders of such shares),
or (3) shall sell, purchase, lease, exchange, mortgage, pledge, transfer
or otherwise acquire (other than as a pro rata dividend) or dispose of, to,
from or with, as the case may be (in one transaction or a series of
transactions), the Company or any of its Subsidiaries, any assets (including
securities) on terms and conditions less favorable to the Company or such
Subsidiary than the Company or such Subsidiary would be able to obtain in arm’s-length
negotiation with an unaffiliated third party, or (4) shall receive any
compensation from the Company or any of its Subsidiaries for services other
than compensation for employment as a regular or part-time employee, or fees
for serving as a director, at rates in accordance with the Company’s (or its
Subsidiary’s) past practices, or (5) shall receive the benefit, directly
or indirectly (except proportionately as a stockholder), of any loans,
advances, guarantees, pledges or other financial assistance or any tax credits
or tax advantage provided by the Company or any of its Subsidiaries, or (6) shall
engage in any transaction with the Company (or any of its Subsidiaries)
involving the sale, license, transfer or grant of any right in, or disclosure
of, any patents, copyrights, trade secrets, trademarks, know-how or any other
intellectual or industrial property rights recognized under any country’s
intellectual property laws which the Company (including its Subsidiaries) owns
or has the right to use on terms and conditions not approved by the Board of
Directors; or


 


(B)                                any
Person, alone or together with its Affiliates and Associates, shall become an
Acquiring Person; or


 


14





















 


(C)                                during
such time as there is an Acquiring Person, there shall be any reclassification
of securities (including any reverse stock split), or any recapitalization of
the Company, or any merger or consolidation of the Company with any of its
Subsidiaries or any other transaction or series of transactions involving the
Company or any of its Subsidiaries (whether or not with or into or otherwise
involving an Acquiring Person or any Affiliate or Associate of such Acquiring
Person) which has the effect, directly or indirectly, of increasing by more
than 1% the proportionate share of the outstanding shares of any class of
equity securities of the Company or any of its Subsidiaries, or securities
exercisable for or convertible into equity securities of the Company or any of
its Subsidiaries, which is directly or indirectly beneficially owned by any
Acquiring Person or any Affiliate or Associate of any Acquiring Person (any of
(A), (B) or (C) being referred to herein as a “Flip-In Event”);


 


then upon the first occurrence of such Flip-In Event (i) the
Purchase Price shall be adjusted to be the Purchase Price in effect immediately
prior to the Flip-In Event multiplied by the number of one one-thousandth of a share of Preferred
Stock for which a Right was exercisable immediately prior to such Flip-In
Event, whether or not such Right was then exercisable, and (ii) each
holder of a Right, except as otherwise provided in this Section 11(a)(ii) and
Section 11(a)(iii) hereof, shall thereafter have the right to
receive, upon exercise thereof at a price equal to the Purchase Price (as so
adjusted), in accordance with the terms of this Rights Agreement and in lieu of
shares of Preferred Stock, such number of shares of Common Stock as shall equal
the result obtained by dividing the Purchase Price (as so adjusted) by 50% of
the Current Market Price per share of the Common Stock (determined pursuant to Section 11(d) hereof)
on the date of such Flip-In Event; provided, however, that the
Purchase Price (as so adjusted) and the number of shares of Common Stock so
receivable upon the exercise of a Right shall, following the Flip-In Event, be
subject to further adjustment as appropriate in accordance with Section 11(f) hereof.  Notwithstanding anything in this Rights
Agreement to the contrary, however, from and after the Flip-In Event, any
Rights that are beneficially owned by (x) any Acquiring Person (or any
Affiliate or Associate of any Acquiring Person), (y) a transferee of any
Acquiring Person (or any such Affiliate or Associate) who becomes a transferee
after the Flip-In Event or (z) a transferee of any Acquiring Person (or
any such Affiliate or Associate) who became a transferee prior to or
concurrently with the Flip-In Event pursuant to either (I) a transfer from
the Acquiring Person to holders of its equity securities or to any Person with
whom it has any continuing agreement, arrangement or understanding, whether
written or otherwise, regarding the transferred Rights or (II) a transfer
which the Board of Directors has determined is part of a plan, agreement,
arrangement or understanding, whether written or otherwise, which has the
purpose or effect of avoiding the provisions of this paragraph, and subsequent
transferees of such Persons, shall be null and void without any further action
and any holder of such Rights shall thereafter have no rights whatsoever with
respect to such Rights under any provision of this Rights Agreement.  The Company shall notify the Rights Agent in
writing when this Section 11(a)(ii) applies and shall use all
reasonable efforts to ensure that the provisions of this Section 11(a)(ii) are
complied with, but neither the Company nor the Rights Agent shall have any
liability to any holder of Right Certificates or other Person as a result of
the Company’s failure to make any determinations with respect to an Acquiring
Person or its Affiliates, Associates or transferees hereunder.  From and after the Flip-In Event, no Right
Certificate shall be issued pursuant to Section 3 or Section 6 hereof
that represents Rights that are or have become null and void pursuant to the
provisions of this paragraph, and any Right Certificate delivered to the Rights


 


15





















 


Agent that
represents Rights that are or have become null and void pursuant to the
provisions of this paragraph shall be canceled.


 


(ii)                                  The
Company may at its option substitute for a share of Common Stock issuable upon
the exercise of Rights in accordance with the foregoing subparagraph (ii) such
number or fractions of shares of Preferred Stock having an aggregate current
market value equal to the Current Market Price of a share of Common Stock.  In the event that there shall not be
sufficient shares of Common Stock issued but not outstanding or authorized but
unissued to permit the exercise in full of the Rights in accordance with the
foregoing subparagraph (ii), the Board of Directors shall, to the extent
permitted by applicable law and any material agreements then in effect to which
the Company is a party (A) determine the excess (such excess, the “Spread”)
of (1) the value of the shares of Common Stock issuable upon the exercise
of a Right in accordance with the foregoing subparagraph (ii) (the “Current
Value”) over (2) the Purchase Price (as adjusted in accordance with the
foregoing subparagraph (ii)), and (B) with respect to each Right
(other than Rights which have become null and void pursuant to the foregoing
subparagraph (ii)), make adequate provision to substitute for the shares
of Common Stock issuable in accordance with the foregoing paragraph (ii) upon
exercise of the Right and payment of the Purchase Price (as adjusted in
accordance therewith), (1) cash, (2) a reduction in such Purchase
Price, (3) shares of Preferred Stock or other equity securities of the
Company (including, without limitation, shares or fractions of shares of
preferred stock which, by virtue of having dividend, voting and liquidation
rights substantially comparable to those of the shares of Common Stock, are
deemed in good faith by the Board of Directors to have substantially the same
value as the shares of Common Stock (such shares of Preferred Stock and shares
or fractions of shares of preferred stock being hereinafter referred to as “Common
Stock Equivalents”), (4) debt securities of the Company, (5) other
assets, or (6) any combination of the foregoing, having a value which,
when added to the value of the shares of Common Stock actually issued upon
exercise of such Right, shall have an aggregate value equal to the Current
Value (less the amount of any reduction in such Purchase Price), where such
aggregate value has been determined by the Board of Directors upon the advice
of a nationally recognized investment banking firm selected in good faith by
the Board of Directors; provided, however, that if the Company
shall not make adequate provision to deliver value pursuant to clause (B) above
within 30 days following the date of the Flip-In Event (the “Flip-in Trigger
Date”), then the Company shall be obligated to deliver, to the extent permitted
by applicable law and any material agreements then in effect to which the
Company is a party, upon the surrender for exercise of a Right and without
requiring payment of such Purchase Price, shares of Common Stock (to the extent
available), and then, if necessary, such number or fractions of shares of
Preferred Stock (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 shall determine in
good faith that it is likely that sufficient additional shares of Common Stock
and/or Common Stock Equivalents 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 more than 90 days after the Flip-In Trigger Date,
in order that the Company may seek stockholder approval for the authorization
of such additional shares of Common Stock or Common Stock Equivalents (such 30-day
period, as it may be extended being hereinafter referred to as the “Substitution
Period”).  To the extent that the Company
determines that some action need be taken pursuant to the second and/or third
sentence of this Section 11(a)(iii), the Company (x) shall provide,
subject to the last sentence of Section 11(a)(ii) hereof, that such
action shall apply uniformly to all outstanding Rights, and


 


16





















 


(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 the first sentence of Section 11(a)(iii) and
to determine the value thereof.  In the
event of any such suspension, the Company shall issue a public announcement
(with prompt written notice thereof to the Rights Agent) stating that the
exercisability of the Rights has been temporarily suspended, as well as a
public announcement (with prompt written notice thereof to the Rights Agent) at
such time as the suspension is no longer in effect.  For purposes of this Section 11(a)(iii),
the value of the Common Stock shall be the Current Market Price per share of
the Common Stock on the Flip-In Trigger Date and the per share or per unit
value of any Common Stock Equivalent shall be deemed to equal the Current
Market Price per share of the Common Stock on such date.  The Board of Directors may, but shall not be
required to, establish procedures to allocate the right to receive Common Stock
upon the exercise of the Rights among holders of Rights pursuant to this Section 11(a)(iii).


 


(b)                                 In
case the Company shall fix a record date for the issuance of rights (other than
the Rights), options or warrants to all holders of Preferred Stock entitling
them to subscribe for or purchase Preferred Stock (for a period expiring within
45 calendar days after such record date), shares having the same rights,
privileges and preferences as the Preferred Stock (a “Preferred Stock Equivalent”)
or securities convertible into Preferred Stock or Preferred Stock Equivalent at
a price per share of Preferred Stock or Preferred Stock Equivalent (or having a
conversion price per share, if a security convertible into Preferred Stock or
Preferred Stock Equivalent) less than the Current Market Price per share of
Preferred Stock on such record date, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the numerator of
which shall be the number of shares of Preferred Stock outstanding on such
record date, plus the number of shares of Preferred Stock which the aggregate
offering price of the total number of shares of Preferred Stock and/or
Preferred Stock Equivalent (and/or the aggregate initial conversion price of
the convertible securities so to be offered) would purchase at such Current
Market Price, and the denominator of which shall be the number of shares of
Preferred Stock outstanding on such record date, plus the number of additional
shares of Preferred Stock and/or Preferred Stock Equivalent to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible).  In
case such subscription price may be paid by delivery of consideration part or
all of which is in a form other than cash, the value of such non-cash
consideration shall be as determined in good faith by the Board of Directors,
whose determination shall be described in a statement filed with the Rights
Agent.  Shares of Preferred Stock owned
by or held for the account of the Company shall not be deemed outstanding for
the purpose of any such computation. 
Such adjustment shall be made successively whenever such a record date
is fixed, and in the event that such rights or warrants are not so issued, the
Purchase Price shall be adjusted to be the Purchase Price which would then be
in effect if such record date had not been fixed.


 


(c)                                  In
case the Company shall fix a record date for a distribution to all holders of
Preferred Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing corporation) of
evidences of indebtedness, cash, assets (other than a dividend payable in
Preferred Stock, but including any dividend payable in stock other than
Preferred Stock) 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


 


17





















 


determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the Current Market Price per share of
Preferred Stock on such record date, less the fair market value (as determined
in good faith by the Board of Directors, whose determination shall be described
in a statement filed with the Rights Agent) of the portion of the cash, assets
or evidences of indebtedness to be distributed or of such subscription rights
or warrants applicable to a share of Preferred Stock and the denominator of
which shall be such Current Market Price per share of Preferred Stock.  Such adjustments shall be made successively
whenever such a record date is fixed, and in the event that such distribution
is not so made, the Purchase Price shall be adjusted to be the Purchase Price
which would have been in effect if such record date had not been fixed.


 


(d)                                 (i)                                     For
the purpose of any computation hereunder, other than computations made pursuant
to Section 11(a)(iii) hereof, the “Current Market Price” per share of
Common Stock on any date shall be deemed to be the average of the daily closing
prices per share of the Common Stock for the 30 consecutive Trading Days
immediately prior to, but not including such date, and for purpose of
computations made pursuant to Section 11(a)(iii) hereof, the “Current
Market Price” per share of the Common Stock on any date shall be deemed to be
the average of the daily closing prices per share of the Common Stock for the
10 consecutive Trading Days immediately following but not including such date; provided,
however, that in the event that the Current Market Price per share of the
Common Stock is determined during a period following the announcement by the
issuer of the Common Stock of (i) any dividend or distribution on the
Common Stock (other than a regular quarterly cash dividend and other than the
Rights), (ii) any subdivision, combination or reclassification of the Common
Stock, and prior to the expiration of the requisite 30 Trading Day or 10
Trading Day period, as set forth above, after the ex-dividend date for such
dividend or distribution, or the record date for such subdivision, combination
or reclassification occurs, then, and in each such case, the Current Market
Price shall be properly adjusted to take into account ex-dividend trading.  The closing price for each 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 shares of Common Stock are not listed or admitted to
trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the shares of Common Stock
are listed or admitted to trading or, if the shares of Common Stock are not
listed or admitted to trading on any national securities exchange, the last
quoted sale 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 NASDAQ or such
other system then in use, or, if on any such date the shares of Common Stock
are not quoted by any such organization, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in the
Common Stock selected by the Board of Directors.  If on any such date no market maker is making
a market in the Common Stock, the fair value of such shares on such date as determined
in good faith by the Board of Directors shall be used and shall be binding on
the Rights Agent.  If the Common Stock is
not publicly held or not so listed or traded, “Current Market Price” per share
shall mean the fair value per share as determined in good faith by the Board of
Directors, whose determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes.


 


18





















 


(ii)                                  For
the purpose of any computation hereunder, the “Current Market Price” per share
(or one one-thousandth of a
share) of Preferred Stock shall be determined in the same manner as set forth
above for the Common Stock in clause (i) of this Section 11(d) (other
than the last sentence thereof).  If the
Current Market Price per share (or one
one-thousandth of a share) of Preferred Stock cannot be determined in
the manner provided above or if the Preferred Stock is not publicly held or
listed or traded in a manner described in clause (i) of this Section 11(d),
the “Current Market Price” per share of Preferred Stock shall be conclusively
deemed to be an amount equal to 1,000
(as such number may be appropriately adjusted for such events as stock splits,
stock dividends and recapitalizations with respect to the Common Stock
occurring after the date of this Rights Agreement) multiplied by the Current
Market Price per share of the Common Stock and the “Current Market Price” per one one-thousandth of a share of
Preferred Stock shall, be equal to the Current Market Price per share of the
Common Stock (as appropriately adjusted). 
If neither the Common Stock nor the Preferred Stock is publicly held or
so listed or traded, “Current Market Price” shall mean the fair value per share
as determined in good faith by the Board of Directors, whose determination
shall be described in a statement filed with the Rights Agent and shall be
conclusive for all purposes.


 


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


 


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


 


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


 


(h)                                 Unless
the Company shall have exercised its election as provided in Section 11(i),
upon each adjustment of the Purchase Price as a result of the calculations made
in Sections 11(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-thousandth of a share of
Preferred Stock (calculated to the nearest one-


 


19





















 


hundred-thousandth)
obtained by (i) multiplying (x) the number of one one-thousandth of a share of Preferred Stock covered by a
Right immediately prior to this adjustment, by (y) the Purchase Price in
effect immediately prior to such adjustment of the Purchase Price, and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.


 


(i)                                     The
Company may elect on or after the date of any adjustment of the Purchase Price
or any adjustment to the number of shares of Preferred Stock for which a Right
may be exercised made pursuant to Sections 11(a)(i), 11(b) or 11(c),
to adjust the number of Rights in lieu of any adjustment in the number of
shares of Preferred Stock purchasable upon the exercise of a Right.  Each of the Rights outstanding after the
adjustment in the number of Rights shall be exercisable for the number of
shares of Preferred Stock for which a Right was exercisable immediately prior
to such adjustment.  Each Right held of
record prior to such adjustment of the number of Rights shall become that
number of Rights (calculated to the nearest one hundred-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
promptly notify the Rights Agent in writing and make a public announcement of
its election to adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment to be
made.  This record date may be the date
on which the Purchase Price is adjusted or any day thereafter, but, if the
Right Certificates have been issued, shall be at least 10 days later than
the date of the public announcement.  If
Right Certificates have been issued, upon each adjustment of the number of
Rights pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right Certificates
on such record date Right Certificates evidencing, subject to Section 14
hereof, the additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment.  Right Certificates so to be
distributed shall be issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the adjusted Purchase
Price) and shall be registered in the names of the holders of record of 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 shares of
Preferred Stock issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to express the
Purchase Price per share and the number of shares which were expressed in the
initial Right Certificate issued hereunder.


 


(k)                                  Before
taking any action that would cause an adjustment reducing the Purchase Price
below the then par value, if any, of the shares of Common Stock, Preferred
Stock or other capital stock issuable upon exercise of the Rights, the Company
shall take any corporate action, including using its best efforts to obtain any
required stockholder approvals, which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue fully paid
and nonassessable shares of Common Stock, Preferred Stock or other capital
stock at such adjusted Purchase Price. 
If upon any exercise of the Rights, a holder is to receive a


 


20





















 


combination of Common
Stock and Common Stock Equivalents, a portion of the consideration paid upon
such exercise, equal to at least the then par value of a share of Common Stock
of the Company, shall be allocated as the payment for each share of Common
Stock of the Company so received.


 


(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 (with prompt written notice thereof to the Rights
Agent) until the occurrence of such event the issuance to the holder of any
Right exercised after such record date the shares of Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such exercise
over and above the shares of Preferred Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise on the basis of
the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder’s right to receive such
additional shares of Preferred Stock and other capital stock 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 permitted or required by this Section 11, as and to
the extent that in their good faith judgment the Board of Directors shall
determine to be advisable in order that any (i) consolidation or
subdivision of the Preferred Stock, (ii) issuance for cash of any shares
of Preferred Stock at less than the Current Market Price, (iii) issuance
for cash of shares of Preferred Stock or securities which by their terms are
convertible into or exchangeable for shares of Preferred Stock, (iv) stock
dividends or (v) issuance of rights, options or warrants referred to in
this Section 11, hereafter made by the Company to holders of its Preferred
Stock shall not be taxable to such stockholders.


 


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


 


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


 


21





















 


such action will diminish
substantially or eliminate the benefits intended to be afforded by the Rights.


 


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


 


12.                                 Certification of Adjustments.  Whenever an adjustment is made as provided in
Sections 11 or 13 hereof, the Company shall (a) promptly prepare a
certificate signed by its Chief Executive Officer, its President or any Vice
President and by the Treasurer or any Assistant Treasurer or the Secretary or
any Assistant Secretary of the Company setting forth such adjustment and a
brief statement of the facts and computations giving rise to such adjustment, (b) promptly
file with the Rights Agent and with each transfer agent for the Preferred Stock
and the Common Stock a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Right Certificate (or, if prior to the
Distribution Date, to each holder of a certificate representing shares of
Common Stock) in accordance with Section 26 hereof.  Notwithstanding the foregoing sentence, the
failure of the Company to give such notice shall not affect the validity of or
the force or effect of or the requirement for such adjustment.  The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment or statement therein
contained and shall have no duty or liability with respect to, and shall not be
deemed to have knowledge of any such adjustment or any such event unless and
until it shall have received such a certificate.  Any adjustment to be made pursuant to
Sections 11 and 13 of this Rights Agreement shall be effective as of the date
of the event giving rise to such adjustment.


 


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


 


(a)                                  In
the event that following the first occurrence of a Flip-In Event, directly or indirectly,
(x) the Company shall consolidate with, or merge with and into, any other
Person or Persons and the Company, as the case may be, shall not be the
surviving or continuing Person of such consolidation or merger, or (y) any
Person or Persons shall consolidate with, or merge with and into, the Company,
and the Company shall be the continuing or surviving Person of such
consolidation or merger and, in connection with such consolidation or merger,
all or part of the outstanding shares of Common Stock shall be changed into or
exchanged for stock or other securities of any other Person or of the Company
or cash or any other property other than, in the case of the transactions
described in subparagraphs (x) or (y), a merger or consolidation which would
result in all of the Voting Power represented by the securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being


 


22





















 


converted into securities
of the surviving entity) all of the Voting Power represented by the securities
of the Company or such surviving entity outstanding immediately after such
merger or consolidation and the holders of such securities not having changed
as a result of such transactions), or (z) the Company or one or more of
its Subsidiaries shall sell, mortgage or otherwise transfer to any other Person
or any Affiliate or Associate of such Person, in one transaction, or a series
of related transactions, assets or earning power aggregating more than 50% of
the assets or earning power of the Company and its Subsidiaries (taken as a
whole), then, on the first occurrence of any such event (a “Flip-Over Event”),
proper provision shall be made so that (i) each holder of a Right (other
than Rights which have become null and void pursuant to Section 11(a)(ii) hereof)
shall thereafter have the right to receive, upon the exercise thereof at the
Purchase Price (as theretofore adjusted in accordance with Section 11(a)(ii) hereof),
in accordance with the terms of this Rights Agreement and in lieu of shares of
Preferred Stock or Common Stock of the Company, such number of validly
authorized and issued, fully paid, non-assessable and freely tradeable shares
of Common Stock of the Principal Party (as such term is hereinafter defined),
not subject to any liens, encumbrances, rights of first refusal or other
adverse claims, as shall equal the result obtained by dividing the Purchase
Price (as theretofore adjusted in accordance with Section 11(a)(ii) hereof)
by 50% of the Current Market Price per share of the Common Stock of such
Principal Party (determined pursuant to Section 11(d) hereof) on the
date of consummation of such consolidation, merger, sale or transfer; provided,
however, that the Purchase Price (as theretofore adjusted in accordance
with Section 11(a)(ii) hereof) and the number of shares of Common
Stock of such Principal Party so receivable upon exercise of a Right shall be
subject to further adjustment as appropriate in accordance with Section 11(f) hereof
to reflect any events occurring in respect of the Common Stock of such
Principal Party after the occurrence of such consolidation, merger, sale or
transfer; (ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Flip-Over Event, all the obligations and duties
of the Company pursuant to this Rights Agreement; (iii) the term “Company”
for all purposes of this Rights Agreement shall thereafter be deemed to refer
to such Principal Party, it being specifically intended that the provisions of Section 11
hereof shall only apply to such Principal Party following the first occurrence
of a Flip-Over Event; and (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient number of
shares of its Common Stock in accordance with Section 9 hereof) in
connection with the consummation of any such transaction as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights; provided, however, that, upon the
subsequent occurrence of any merger, consolidation, sale of all or
substantially all assets, recapitalization, reclassification of shares,
reorganization or other extraordinary transaction in respect of such Principal
Party, each holder of a Right shall thereupon be entitled to receive, upon
exercise of a Right, such cash, shares, rights, warrants and other property
which such holder would have been entitled to receive had he, at the time of
such transaction, owned the shares of Common Stock of the Principal Party
purchasable upon the exercise of a Right, and such Principal Party shall take
such steps (including, but not limited to, reservation of shares of stock) as
may necessary to permit the subsequent exercise of the Rights in accordance
with the terms hereof for such cash, shares, rights, warrants and other
property.


 


23





















 


(b)                                 “Principal
Party” shall mean


 


(i)                                     in
the case of any transaction described in (x) or (y) of the first sentence of Section 13(a) hereof:  (A) the Person that is the issuer of the
securities into which shares of Common Stock of the Company are converted in
such merger or consolidation, or, if there is more than one such issuer, the
issuer the Common Stock of which has the greatest aggregate market value or (B) if
no securities are so issued, (x) the Person that is the other party to the
merger or consolidation and that survives said merger or consolidation, or, if
there is more than one such Person, the Person the Common Stock of which has
the greatest market value or (y) if the Person that is the other party to
the merger or consolidation does not survive the merger or consolidation, the
Person that does survive the merger or consolidation (including the Company if
it survives); and


 


(ii)                                  in
the case of any transaction described in (z) of the first sentence in 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, or, if
each Person that is a party to such transaction or transactions receives the
same portion of the assets or earning power so transferred or if the Person
receiving the greatest portion of the assets or earning power cannot be
determined, whichever of such Persons that is the issuer of Common Stock having
the greatest aggregate market value of shares outstanding;


 


provided, however, that in any such
case described in the foregoing paragraphs (b)(i) or (b)(ii), (1) if
the Common Stock of such Person is not at such time and has not been
continuously over the preceding 12-month period registered under Section 12
of the Exchange Act, and such Person is a direct or indirect Subsidiary of
another Person the Common Stock of which is and has been so registered, the
term “Principal Party” shall refer to such other Person, or (2) if such
Person is a Subsidiary, directly or indirectly, of more than one Person, the
Common Stocks of all of which are and have been so registered, the term “Principal
Party” shall refer to whichever of such Persons is the issuer of the Common
Stock having the greatest market value of shares outstanding, or (3) if
such Person is owned, directly or indirectly, by a joint venture formed by two
or more Persons that are not owned, directly or indirectly, by the same Person,
the rules set forth in clauses (1) and (2) above shall
apply to each of the owners having an interest in the joint venture as if the
Person owned by the joint venture was a Subsidiary of both or all of such joint
venturers, and the Principal Party in each such case shall bear the obligations
set forth in this Section 13 in the same ratio as its interest in such
Person bears to the total of such interests.


 


(c)                                  The
Company shall not consummate any consolidation, merger, sale or transfer
referred to in Section 13(a) unless the Principal Party shall have a
sufficient number of authorized shares of its Common Stock that have not been
issued or reserved for issuance to permit the exercise in full of the Rights in
accordance with this Section 13 and unless prior thereto the Company and
the Principal Party involved therein shall have executed and delivered to the
Rights Agent an agreement confirming that the requirements of Sections 13(a) and
(b) hereof shall promptly be performed in accordance with their terms and
that such consolidation, merger, sale or transfer of assets shall not result in
a default by the Principal Party under this Rights Agreement as the same shall
have been assumed by the Principal Party pursuant to Sections 13(a) and
(b) hereof and further providing that, as soon as practicable after
executing such agreement pursuant to this Section 13, the Principal Party
at its own expense shall:


 


24





















 


(i)                                     prepare
and file a registration statement under the Securities Act, if necessary, with
respect to the Rights and the securities purchasable upon exercise of the
Rights on an appropriate form, use its best efforts to cause such registration
statement to become effective as soon as practicable after such filing and use
its best efforts to cause such registration statement to remain effective (with
a prospectus at all times meeting the requirements of the Securities Act) until
the date of expiration of the Rights, and similarly comply with applicable
state securities laws;


 


(ii)                                  use
its best efforts, if the Common Stock of the Principal Party shall become
listed on a national securities exchange, to list (or continue the listing of)
the Rights and the securities purchasable upon exercise of the Rights on such
securities exchange and, if the Common Stock of the Principal Party shall not
be listed on a national securities exchange, to cause the Rights and the
securities purchased upon exercise of the Rights to be reported by the NASDAQ or such other system then
in use;


 


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


 


(iv)                              obtain
waivers of any rights of first refusal or preemptive rights in respect of the
shares of Common Stock of the Principal Party subject to purchase upon exercise
of outstanding Rights.


 


In the event that any of the transactions described in
Section 13(a) hereof shall occur at any time after the occurrence of
a transaction described in Section 11(a)(ii) hereof, the Rights which
have not theretofore been exercised shall thereafter be exercisable in the
manner described in Section 13(a).


 


(d)                                 Furthermore,
in case the Principal Party which is to be a party to a transaction referred to
in this Section 13 has a provision in any of its authorized securities or
in its Certificate of Incorporation or Bylaws or other instrument governing its
corporate affairs, which provision would have the effect of (i) causing
such Principal Party to issue, in connection with, or as a consequence of, the
consummation of a transaction referred to in this Section 13, shares of
Common Stock of such Principal Party at less than the then Current Market Price
per share (determined pursuant to Section 11(d) hereof) or securities
exercisable for, or convertible into, Common Stock of such Principal Party at
less than such then current market price (other than to holders of Rights
pursuant to this Section 13) or (ii) providing for any special
payment, tax or similar provisions in connection with the issuance of the
Common Stock of such Principal Party pursuant to the provisions of Section 13;
then, in such event, the Company hereby agrees with each holder of Rights that
it shall not consummate any such transaction unless prior thereto the Company
and such Principal Party shall have executed and delivered to the Rights Agent
a supplemental agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with, or as a consequence of, the consummation of
the proposed transaction.


 


25





















 


14.                                 Fractional Rights and Fractional
Shares.


 


(a)                                  The
Company shall not be required to issue fractions of Rights or to distribute
Right Certificates which evidence fractional Rights.  In lieu of such fractional Rights, there
shall be paid to the holders of record 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 then current market value of a whole
Right.  For the purposes of this Section 14(a),
the then current market value of a Right shall be determined in the same manner
as the Current Market Price of a share of Common Stock shall be determined
pursuant to Section 11(d) hereof.


 


(b)                                 The
Company shall not be required to issue fractions of shares of Preferred Stock
or Preferred Stock Equivalent (other than fractions which are integral
multiples of one one-thousandth
of a share of Preferred Stock) upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Preferred Stock Equivalent
(other than fractions which are integral multiples of one one-thousandth of a share of Preferred Stock).  Fractions of shares of Preferred Stock in
integral multiples of one
one-thousandth of a share of Preferred Stock or Preferred Stock
Equivalent may, at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company and a
depositary selected by it, provided that such agreement shall provide that the
holders of such depositary receipts shall have all the rights, privileges and
preferences to which they are entitled as beneficial owners of the shares of
Preferred Stock or Preferred Stock Equivalent represented by such depositary
receipts.  In lieu of fractional shares
of Preferred Stock that are not integral multiples of one one-thousandth of a share of
Preferred Stock or Preferred Stock Equivalent, the Company may pay to the
registered holders of Right Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same fraction of the current
market value of one one-thousandth
of a share of Preferred Stock or Preferred Stock Equivalent.  For purposes of this Section 14(b), the
current market value of one
one-thousandth of a share of Preferred Stock or Preferred Stock
Equivalent shall be the Current Market Price of a share of Common Stock (as
determined pursuant to Section 11(d)(ii) hereof) for the Trading Day
immediately prior to the date of such exercise.


 


(c)                                  Following
the occurrence of a Flip-In Event, the Company shall not be required to issue
fractions of shares or units of Common Stock or Common Stock Equivalents or
other securities upon exercise of the Rights or to distribute certificates
which evidence fractional shares of such Common Stock or Common Stock
Equivalents or other securities.  In lieu
of fractional shares or units of such Common Stock or Common Stock Equivalents
or other securities, the Company may 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 share or
unit of such Common Stock or Common Stock Equivalent or other securities.  For purposes of this Section 14(c), the
Current Market Value shall be determined in the manner set forth in Section 11(d) hereof
for the Trading Day immediately prior to the date of such exercise and, if such
Common Stock Equivalent is not traded, each such Common Stock Equivalent shall
have the value of one one-thousandth
of a share of Preferred Stock.


 


(d)                                 The
holder of a Right by the acceptance of a Right expressly waives his right to
receive any fractional Right or any fractional shares upon exercise of a Right.


 


26





















 


(e)                                  Whenever
a payment for fractional Rights or fractional shares is to be made by the
Rights Agent, the Company shall (i) promptly prepare and deliver to the
Rights Agent a certificate setting forth in reasonable detail the facts related
to such payments and the prices and/or formulas utilized in calculating such
payments, and (ii) provide sufficient monies to the Rights Agent in the
form of fully collected funds to make such payments.  The Rights Agent shall be fully protected in
relying upon such a certificate and shall have no duty with respect to, and
shall not be deemed to have knowledge of any payment for fractional Rights or
fractional shares under any Section of this Agreement relating to the
payment of fractional Rights or fractional shares unless and until the Rights
Agent shall have received such a certificate and sufficient monies.


 


15.                                 Rights of Action.  As of the Record Date, all rights of action
in respect of this Right Agreement, other than any rights of action vested in
the Rights Agent, are vested in the respective holders of record of the Right
Certificates (and, prior to the Distribution Date, the holders of record of the
Common Stock); and any holder of record of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company or any other Person 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 Rights 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 Rights Agreement and, accordingly, that they will be entitled to
specific performance of the obligations under, and injunctive relief against
actual or threatened violations of, the obligations of any Person subject to
this Rights Agreement.  Holders of Rights
shall be entitled to recover the reasonable costs and expenses, including attorneys’
fees, incurred by them in any action to enforce the provisions of this Rights
Agreement.


 


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 not be evidenced by a Right
Certificate and will be transferable only in connection with the transfer of
Common Stock;


 


(b)                                 after
the Distribution Date, the Right Certificates will be transferable only on the
registry books of the Rights Agent if surrendered at the office of the Rights
Agent designated for such purpose, 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
Stock 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 Stock certificate made by
anyone other than the Company or the Rights Agent or the transfer agent of the
Common Stock) for all purposes whatsoever, and neither the Company nor the
Rights Agent shall be affected by any notice to the contrary; and


 


27





















 


(d)                                 notwithstanding
anything in this Rights 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
Rights Agreement by reason of any preliminary 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 obligation; provided, however, that the Company must use its best
efforts to have any such order, decree or ruling lifted or otherwise overturned
as soon as possible.


 


17.                                 Right Certificate Holder Not
Deemed a Stockholder.  No
holder of a Right, as such, shall be entitled to vote, receive dividends in
respect of or be deemed for any purpose to be the holder of Common Stock or any
other securities of the Company which may at any time be issuable upon the
exercise of the Rights, 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 or any right to vote in
the election of directors or upon any 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 subscription
rights in respect of any such stock or securities, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have been exercised
in accordance with the provisions hereof.


 


18.                                 Concerning the Rights Agent.


 


(a)                                  The
Company agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and other disbursements
incurred in the preparation, negotiation, delivery, amendment, administration
and execution of this Rights Agreement and the exercise and performance of its
duties hereunder.  The Company also
agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability damage, judgment, fine, penalty, claim, demand, settlement,
cost or expense (including, without limitation, the reasonable fees and
expenses of legal counsel) incurred without gross negligence, bad faith or
willful misconduct on the part of the Rights Agent (which gross negligence, bad
faith or willful misconduct must be determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction), for any
action taken, suffered or omitted by the Rights Agent in connection with the
acceptance, administration, exercise and performance of its duties under this
Rights Agreement.  The costs and expenses
incurred in enforcing this right of indemnification shall be paid by the
Company.  The provisions of this Section 18
and Section 20 below shall survive the termination of this Rights
Agreement, the exercise or expiration of the Rights and the resignation or
removal of the Rights Agent.


 


(b)                                 The
Rights Agent shall be authorized and protected and shall incur no liability for
or in respect of any action taken, suffered or omitted by it in connection with
its acceptance and administration of this Rights Agreement and the exercise and
performance of its duties hereunder, in reliance upon any Right Certificate, or
certificate for the Preferred Stock or Common Stock or for other securities of
the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement


 


28





















 


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


 


19.                                 Merger or Consolidation or
Changed Name of Rights Agent.


 


(a)                                  Any
Person into which the Rights Agent or any successor Rights Agent may be merged
or with which it may be consolidated, or any Person resulting from any merger
or consolidation to which the Rights Agent or any successor Rights Agent shall
be a party, or any Person succeeding to the shareholder services business of
the Rights Agent or any successor Rights Agent, shall be the successor to the
Rights Agent under this Rights Agreement without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided that
such Person would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21 hereof. 
In case at the time such successor Rights Agent shall succeed to the
agency created by this Rights 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 Rights 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 such 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 Certificate shall have the full
force provided in the Right Certificates and in this Rights Agreement.


 


20.                                 Duties of Rights Agent.  The Rights Agent undertakes to perform only
the duties and obligations expressly imposed by this Rights Agreement (and no
implied duties) upon the following terms and conditions, by all of which the
Company and the holders of Right Certificates, by their acceptance thereof,
shall be bound:


 


(a)                                  The
Rights Agent may consult with legal counsel (who may be legal counsel for the
Company or an employee of the Rights Agent), and the advice or opinion of such
counsel shall be full and complete authorization and protection to the Rights
Agent and the rights Agent shall incur no liability for or in respect of any
action taken, suffered or omitted by it and in accordance with such advice or
opinion.


 


(b)                                 Whenever
in the performance of its duties under this Rights Agreement the Rights Agent
shall deem it necessary or desirable that any fact or matter (including,
without limitation, the identity of any Acquiring Person and the determination
of Current Market Price) be proved or established by the Company prior to
taking or suffering or omitting any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically


 


29





















 


prescribed) may be deemed
to be conclusively proved and established by certificate signed by the President
or any Vice President and by the Treasurer or any Assistant Treasurer or the
Secretary or any Assistant Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization and protection to the
Rights Agent for any action taken, suffered or omitted in good faith by it
under the provisions of this Rights 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 gross negligence, bad faith or willful misconduct (which gross
negligence, bad faith or willful misconduct must be determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction).  Anything to the contrary
notwithstanding, in no event shall the Rights Agent be liable for special,
punitive, indirect, consequential or incidental loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Rights
Agent has been advised of the likelihood of such loss or damage.  Any liability of the Rights Agent under this
Rights Agreement will be limited to the amount of annual fees paid by the
Company to the Rights Agent.


 


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


 


(e)                                  The
Rights Agent shall not have any liability for, nor be under any responsibility
in respect of the validity of this Rights 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 or liable for any breach
by the Company of any covenant or condition contained in this Rights Agreement
or in any Right Certificate; nor shall it be responsible or liable for any
adjustment required under the provisions of Sections 11, 13, 23 or 24
hereof or otherwise or responsible or liable for the manner, method or amount
of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after receipt of a Certificate furnished
pursuant to Section 12 describing any such adjustment); nor shall it by
any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Common Stock to be issued
pursuant to this Rights Agreement or any Right Certificate or as to whether any
shares of Common Stock will, when 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 Rights Agreement.


 


(g)                                 The
Rights Agent is hereby authorized and directed to accept instructions with
respect to the performance of its duties hereunder from the Chairman of the
Board, the Chief Executive Officer, the President or any Vice President or the
Secretary or any Assistant Secretary or the Treasurer or any Assistant
Treasurer of the Company, and to apply to such


 


30





















 


officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken, suffered or omitted to be taken by it in good faith in accordance
with instructions of any such officer.  Any
application by the Rights Agent for written instructions from the Company may,
at the option of the Rights Agent, set forth in writing any action proposed to
be taken, suffered or omitted by the Rights Agent under this Rights Agreement
and the date on and/or after which such action shall be taken or suffered or
such omission shall be effective. 
Subject to Section 20(c) hereof, the Rights Agent shall not be
liable for any action taken or suffered by, or omission of, the Rights Agent in
accordance with a proposal included in any such application on or after the
date specified in such application (which date shall not be less than five
Business Days after the date any officer of the Company actually receives such
application, unless any such officer shall have consented in writing to an
earlier date) unless, prior to taking or suffering any such action (or by the
effective date in the case of an omission), the Rights Agent shall have
received written instructions in response to such application specifying the
action to be taken or omitted.


 


(h)                                 The
Rights Agent and any stockholder, affiliate, 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 the Rights Agent under
this Rights Agreement.  Nothing herein
shall preclude the Rights Agent from acting in any other capacity for the
Company or for any other 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 (though its directors,
officers and employees) or by or through its attorneys or agents, and the
Rights Agent shall not be answerable or accountable for any act, omission,
default, neglect or misconduct of any such attorneys or agents or for any loss
to the Company or any other Person resulting from any such act, omission,
default, neglect or misconduct, absent gross negligence or bad faith in the
selection and continued employment thereof (which gross negligence or bad faith
must be determined by a final, non-appealable order, judgment, decree or ruling
of a court of competent jurisdiction)..


 


(j)                                     No
provision of this Rights Agreement shall require the Rights Agent to expend or
risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
it believes that repayment of such funds or adequate indemnification against
such risk or liability is not reasonably assured to it.


 


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


 


21.                                 Change of Rights Agent.  The Rights Agent or any successor Rights
Agent may resign and be discharged from its duties under this Rights Agreement
upon 30 days’ notice in writing, or such earlier period as shall be agreed
to in writing, mailed to the Company and to each transfer agent of the Common
Stock by registered or certified mail. 
The Company may


 


31





















 


remove the Rights Agent
or any successor Rights Agent (with or without cause) upon 30 days’ notice
in writing, or such earlier period as shall be agreed to in writing, mailed to
the Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Common Stock by registered or certified mail, and to the
holders of the Right Certificates by first-class mail.  If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall
appoint a successor to the Rights Agent. 
If the Company shall fail to make such appointment within a period of
30 days after such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent
or by the holder of a Right Certificate (who shall, with such notice, submit
his Right Certificate for inspection by the Company), then the incumbent Rights
Agent or the holder of record of any Right Certificate may apply to any court
of competent jurisdiction for the appointment of a new Rights Agent.  Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be (a) a Person organized and
doing business under the laws of the United States or any State thereof, in
good standing, which is authorized under such laws to exercise stock transfer
or shareholder services 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 $50,000,000 or (b) an
Affiliate controlled by a Person described in clause (a) of this
sentence.  After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose.  Not
later than the effective date of any such appointment the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Common Stock, and mail a notice thereof in writing to the
registered holders of the Right Certificates. 
Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.


 


22.                                 Issuance of New Right Certificates.  Notwithstanding any of the provisions of this
Rights Agreement or of the Rights to the contrary, the Company may, at its
option, issue new Right Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or change in the
Purchase Price per share and the number or kind or class of shares of stock or
other securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Rights Agreement.  In addition, in connection with the issuance
or sale of shares of Common Stock following the Distribution Date and prior to
the redemption or expiration of the Rights, the Company shall, with respect to
shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereinafter issued by the Company, in each
case existing prior to the Distribution Date, issue Right Certificates
representing the appropriate number of Rights in connection with such issuance
or sale; provided, however, that (i) 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 (ii) 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.


 


32





















 


23.                                 Redemption.


 


(a)                                  The
Board of Directors may, at its option, at any time prior to the earlier of
(x) the first occurrence of a Flip-In Event or (y) the Close of
Business on the Expiration Date, redeem all but not less than all the then
outstanding Rights at a redemption price of $0.001 per Right, as such amount may
be appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such redemption price being
hereinafter referred to as the “Redemption Price”).


 


(b)                                 Immediately
upon the action of the Board of Directors ordering the redemption of the Rights
(or at such later time as the Board of Directors may establish for the
effectiveness of such redemption), 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.  The Company shall promptly give
written notice to the Rights Agent and shall give public notice of any such
redemption; provided, however, that the failure to give, or any
defect in, any such notice shall not affect the validity of such
redemption.  Within 10 days after such
action of the Board of Directors ordering the redemption of the Rights (or such
later time as the Board of Directors may establish for the effectiveness of
such redemption), the Company shall mail a notice of redemption to all the
holders of the then outstanding Rights at their last addresses as they appear
upon the registry books of the Rights Agent or, prior to the Distribution Date,
on the registry books of the transfer agent for the Common Stock.  Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice.  Each such notice of redemption
shall state the method by which the payment of the Redemption Price will be
made.  The failure to give notice
required by this Section 23(b) or any defect therein shall not affect
the legality or validity of the action taken by the Company.


 


(c)                                  In
the case of a redemption permitted under Section 23(a) hereof, the
Company may, at its option, discharge all of its obligations with respect to
the Rights by (i) issuing a press release announcing the manner of
redemption of the Rights and (ii) mailing payment of the Redemption Price
to the registered holders of the Rights at their last addresses as they appear
on the registry books of the Rights Agent or, prior to the Distribution Date,
on the registry books of the transfer agent of the Common Stock, and upon such
action, all outstanding Right Certificates shall be null and void without any
further action by the Company.


 


24.                                 Exchange of Rights for Common Stock.


 


(a)                                  The
Board of Directors may, at its option, at any time after the occurrence of a
Flip-In Event, exchange all or part of the then outstanding and exercisable
Rights (which (i) shall not include Rights that have become null and void
pursuant to the provisions of Section 11(a)(ii) and (ii) shall
include, without limitation, any Rights issued after the Distribution Date in
accordance with Section 22 hereof) for shares of Common Stock at an
exchange ratio of one share of Common Stock per Right, appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring
after the date hereof (the “Exchange Ratio”). 
Notwithstanding the foregoing the Board of Directors shall not be
empowered to effect such exchange at any time after any Person (other than an
Exempt Person), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of shares of Common Stock


 


33





















 


aggregating 50% or more
of the shares of Common Stock then outstanding. 
From and after the occurrence of an event specified in Section 13(a) hereof,
any Rights that theretofore have not been exchanged pursuant to this Section 24(a) shall
thereafter be exercisable only in accordance with Section 13 and may not
be exchanged pursuant to this Section 24(a).


 


(b)                                 Immediately
upon the action of the Board of Directors ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 and without any
further action and without any notice, the right to exercise such Rights shall
terminate and the only right thereafter of a holder of such Rights shall be to
receive that number of shares of Common Stock equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio.  The Company shall promptly give the Rights
Agent notice and public notice of any such exchange; provided, however,
that the failure to give, or any defect in, such notice shall not affect the
validity of such exchange.  The Company
promptly shall mail a notice of any such exchange to all of the holders of such
Rights at their last addresses as they appear upon the registry books of the
Rights Agent.  Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder
receives the notice.  Each such notice of
exchange will state the method by which the exchange of the shares of Common
Stock for Rights will be effected and, in the event of any partial exchange,
the number of Rights which will be exchanged. 
Any partial exchange shall be effected pro rata based on the number of
Rights (other than Rights which have become null and void pursuant to the
provisions of Section 11(a)(ii) hereof) held by each holder of
Rights.


 


(c)                                  In
any exchange pursuant to this Section 24, the Company, at its option, may
substitute, and, in the event that there shall not be sufficient shares of
Common Stock issued but not outstanding or authorized but unissued to permit
any exchange of Rights as contemplated in accordance with this Section 24,
the Company shall substitute to the extent of such insufficiency, for each
share of Common Stock that would otherwise be issuable upon exchange of a
Right, a number of shares of Preferred Stock or Preferred Stock Equivalent or
fractions thereof having an aggregate current per share market price
(determined pursuant to Section 11(d) hereof) equal to the current
per share market price of one share of Common Stock (determined pursuant to Section 11(d) hereof)
as of the date of the Flip-In Event.


 


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


 


(e)                                  The
Company shall not be required to issue fractions of shares of Common Stock or
to distribute certificates which evidence fractional shares of Common
Stock.  In lieu of such fractional shares
of Common Stock, the Company shall pay to the registered holders of the Right
Certificates with regard to which such fractional shares of Common Stock would
otherwise be issuable an amount in cash equal to the same fraction of the
current market value of a whole share of Common Stock.  For the purposes of this paragraph (d),
the current market value of a whole share of Common Stock shall be the Current
Market Price of a share of Common Stock (as defined in Section 11(d) hereof
for the purposes of computations made other


 


34





















 


than pursuant to Section 11(a)(iii))
for the Trading Day immediately prior to the date of exchange pursuant to this Section 24.


 


25.                                 Notice of Proposed Actions.


 


(a)                                  In
case the Company, after the Distribution Date, shall propose (i) to effect
any of the transactions referred to in Section 11(a)(i) or to pay any
dividend to the holders of record of its Preferred Stock payable in stock of
any class or to make any other distribution to the holders of record of its
Preferred Stock (other than a regular periodic cash dividend), or (ii) to
offer to the holders of record of its Preferred Stock or options, warrants, or
other rights to subscribe for or to purchase shares of Preferred Stock
(including any security convertible into or exchangeable for Preferred Stock)
or shares of stock of any other class or any other securities, options,
warrants, convertible or exchangeable securities or other rights, or (iii) to
effect any reclassification of its Preferred Stock or any recapitalization or
reorganization of the Company, or (iv) to effect any consolidation or merger
with or into, 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 more than 50% of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to, any other Person or Persons, or (v) to
effect the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each holder of record of a Right
Certificate and the Rights Agent, in accordance with Section 26 hereof,
notice of such proposed action, which shall specify the record date for the
purposes of such transaction referred to in Section 11(a)(i), or such
dividend or distribution, or the date on which such reclassification,
recapitalization, reorganization, consolidation, merger, sale or transfer of
assets, liquidation, dissolution or winding up is to take place and the record
date for determining participation therein by the holders of record of
Preferred Stock, if any such date is to be fixed, and such notice shall be so
given in the case of any action covered by clause (i) or (ii) above
at least 10 days prior to the record date for determining holders of
record of the Preferred Stock 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
record of Preferred Stock, whichever shall be the earlier.


 


(b)                                 In
case any of the transactions referred to in Section 11(a)(ii) or Section 13
of this Rights Agreement are proposed, then, in any such case, the Company
shall give to each holder of Rights and to the Rights Agent, in accordance with
Section 26 hereof, notice of the proposal of such transaction at least
10 days prior to consummating such transaction, which notice shall specify
the proposed event and the consequences of the event to holders of Rights under
Section 11(a)(ii) or Section 13 hereof, as the case may be, and,
upon consummating such transaction, shall similarly give notice thereof to each
holder of Rights.


 


(c)                                  The
failure to give notice required by this Section 25 or any defect therein
shall not affect the legality or validity of the action taken by the Company or
the vote upon any such action.


 


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


 


35





















 


Mattson Technology, Inc.

47131 Bayside Parkway

Fremont, CA 94538

Attention:  Chief Financial
Officer


 


Subject to the provisions of Section 20 hereof,
any notice or demand authorized by this Rights Agreement to be given or made by
the Company or by the holder of record of any Right Certificate or Right to or
on the Rights Agent shall be sufficiently given or made if in writing and sent
by first-class mail, postage prepaid, addressed (until another address is filed
in writing with the Company) as follows:


 


Mellon
Investor Services, LLC 

235 Montgomery Street, 23rd Floor

San Francisco, California 94104

Attention:  Relationship
Manager


 


Notices or demands authorized by this Rights Agreement
to be given or made by the Company or the Rights Agent to the holder of record
of any Right Certificate or Right 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 it appears upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the Transfer Agent.


 


27.                                 Supplements and Amendments.  Except as provided in the penultimate
sentence of this Section 27, for so long as the Rights are then
redeemable, the Company may in its sole and absolute discretion, and the Rights
Agent shall if the Company so directs, supplement or amend any provision of
this Rights Agreement in any respect without the approval of any holders of the
Rights.  At any time when the Rights are
no longer redeemable, except as provided in the penultimate sentence of this Section 27,
the Company may, and the Rights Agent shall, if the Company so directs,
supplement or amend this Rights Agreement without the approval of any holders
of Right Certificates in order to (i) cure any ambiguity, (ii) correct
or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) shorten or lengthen
any time period hereunder, or (iv) change or supplement the provisions
hereunder in any manner which the Company may deem necessary or desirable; provided
that no such supplement or amendment shall adversely affect the interests of
the holders of Rights as such (other than an Acquiring Person or an Affiliate
or Associate of an Acquiring Person), and no such amendment may cause the
Rights again to become redeemable or cause the Rights Agreement again to become
amendable other than in accordance with this sentence.  Notwithstanding anything contained in this
Rights Agreement to the contrary, upon the delivery of a certificate from an
appropriate officer of the Company and, if requested by the Rights Agent, an
opinion of counsel, that states that the proposed supplement or amendment
complies with this Section 27 and provided that such supplement or
amendment does not change or increase the Rights Agent’s rights, duties,
liabilities or obligations hereunder, the Rights Agent shall execute such
supplement or amendment.  Notwithstanding
anything contained in this Rights Agreement to the contrary, no supplement or
amendment shall be made which changes the Redemption Price.  Prior to the Distribution Date, the interests
of the holders of Rights shall be deemed coincident with the interests of the
holders of Common Stock.


 


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28.                                 Successors. 
All of the covenants and provisions of this Rights 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.


 


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


 


30.                                 Determinations
and Actions by the Board of Directors. 
The Board of Directors shall have the exclusive power and authority to
administer this Rights Agreement and to exercise the rights and powers
specifically granted to the Board of Directors or to the Company, or as may be
necessary or advisable in the administration of this Rights Agreement,
including, without limitation, the right and power to (i) interpret the
provisions of this Rights Agreement and (ii) make all determinations
deemed necessary or advisable for the administration of this Rights Agreement
(including, without limitation, a determination to redeem or not redeem the
Rights or to amend or not amend this Rights Agreement).  All such actions, calculations,
interpretations and determinations that are done or made by the Board of
Directors in good faith shall be final, conclusive and binding on the Company,
the Rights Agent, the holders of the Rights, as such, and all other
parties.  Notwithstanding anything
contained in this Rights Agreement to the contrary, the Rights Agent is
entitled always to assume that the Company’s Board of Directors acted in good
faith and shall be fully protected and incur no liability in reliance thereon.


 


31.                                 Governing Law. 
This Rights Agreement and each Right Certificate issued hereunder shall
be deemed to be a contract made under the laws of the State of Delaware and for
all purposes shall be governed by and construed in accordance with the laws of
such state applicable to contracts to be made solely by residents of such state
and performed entirely within such state; provided, however, that all
provisions regarding the rights, duties, obligations and immunities of the
Rights Agent shall be governed by and construed in accordance with the laws of
the State of New York applicable to contracts made and to be performed entirely
within such State.


 


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


 


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


 


34.                                 Severability. 
If any term, provision, covenant or restriction of this Rights Agreement
is held by a court of competent jurisdiction or other authority to be invalid,
illegal or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Rights


 


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


 


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


 


 


	
  [SEAL]

  	
   

  
	
   

  	
   

  
	
  ATTEST:

  	
  MATTSON TECHNOLOGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Lisa Nalett

  	
   

  	
  By:

  	
  /s/ Robert B. MacKnight

  	
   

  
	
   

  	
  Name: Lisa Nalett

  	
   

  	
  Name: Robert B. MacKnight

  
	
   

  	
  Title:

  	
   

  	
  Title: Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  [SEAL]

  	
   

  
	
   

  	
   

  
	
  ATTEST:

  	
  MELLON INVESTOR SERVICES, LLC

  As Rights Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Sharon Magidson

  	
   

  	
  By:

  	
  /s/ Joseph W.
  Thatcher

  	
   

  
	
   

  	
  Name: Sharon Magidson

  	
   

  	
  Name: Joseph W. Thatcher

  
	
   

  	
  Title:

  	
   

  	
  Title: Vice President

  



 


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