Exhibit 99.86
 EXECUTION COPY
 SHAREHOLDER RIGHTS PLAN AGREEMENT
 DATED AS OF FEBRUARY 10, 2010
 Between
 THERATECHNOLOGIES INC.
 and
 COMPUTERSHARE TRUST COMPANY OF CANADA
 as Rights Agent
 Fasken Martineau DuMoulin LLP




---



##### 



TABLE OF CONTENTS
 PageARTICLE 1 INTERPRETATION
    
    
    21.1 Certain Definitions
    
    
    21.2 Currency
    
    
    151.3 Descriptive Headings
    
    
    151.4 References to Agreement
    
    
    151.5 Calculation of Number and Percentage of Beneficial Ownership ofOutstanding Common Shares
    
    
    161.6 Acting Jointly or in Concert
    
    
    161.7 Application of Statutes, Regulations and Rules
    
    
    16ARTICLE 2 THE RIGHTS
    
    
    162.1 Legend on Certificates
    
    
    162.2 Execution, Authentication, Delivery and Dating of Rights Certificates
    
    
    172.3 Registration, Registration of Transfer and Exchange
    
    
    182.4 Mutilated, Destroyed, Lost and Stolen Rights Certificates
    
    
    182.5 Persons Deemed Owners of Rights
    
    
    192.6 Delivery and Cancellation of Certificates
    
    
    192.7 Agreement of Rights Holders
    
    
    202.8 Rights Certificate Holder Not Deemed a Shareholder
    
    
    20ARTICLE 3 EXERCISE OF THE RIGHTS
    
    
    213.1 Initial Exercise Price, Exercise of Rights, Detachment of Rights
    
    
    213.2 Adjustments to Exercise Price, Number of Rights
    
    
    243.3 Date on Which Exercise is Effective
    
    
    30ARTICLE 4
ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS
    
    
    304.1 Flip-in Event
    
    
    30ARTICLE 5 THE RIGHTS AGENT
    
    
    325.1 General
    
    
    325.2 Merger or Amalgamation or Change of Name of Rights Agent
    
    
    335.3 Duties of Rights Agent
    
    
    345.4 Change of Rights Agent
    
    
    36ARTICLE 6 MISCELLANEOUS
    
    
    366.1 Redemption and Waiver
    
    
    366.2 Expiration
    
    
    386.3 Issuance of New Rights Certificate
    
    
    396.4 Fractional Rights and Fractional Shares
    
    
    396.5 Supplements and Amendments
    
    
    396.6 Rights of Action
    
    
    41
 1




---



##### 



TABLE OF CONTENTS
 Page6.7 Notice of Proposed Actions
    
    
    416.8 Notices
    
    
    426.9 Costs of Enforcement
    
    
    426.10 Successors
    
    
    436.11 Benefits of this Agreement
    
    
    436.12 Governing Law
    
    
    436.13 Counterparts
    
    
    436.14 Severability
    
    
    436.15 Effective Date
    
    
    436.16 Determinations and Actions by the Board of Directors
    
    
    446.17 Time of the Essence
    
    
    446.18 Regulatory Approvals
    
    
    446.19 Language
    
    
    44
 2




---



##### 



MEMORANDUM OF AGREEMENT made as of the 10 th day of February, 2010.
 BETWEEN:
    
    THERATECHNOLOGIES INC., a company
existing under the laws of Québec,(hereinafter called the Company),OF THE FIRST PART,
 AND:
    
    COMPUTERSHARE TRUST COMPANY
OF CANADA, a trust company existing
under the laws of Canada, as
rights agent,(hereinafter called the Rights Agent),OF THE SECOND PART.
 Rights Plan
  Right




---



##### 



ARTICLE 1
INTERPRETATION
 1.1 Certain Definitions
  (a)
    
    1933 Securities Act shall mean the Securities Act of 1933 of the United States, as
amended, and the regulations thereunder, and any comparable or successor regulations
thereto;(b)
    
    1934 Exchange Act shall mean the Securities Exchange Act of 1934 of the United States,
as amended, and the regulations thereunder, and any comparable or successor regulations
thereto;(c)
    
    Acquiring Person shall mean any Person who is the Beneficial Owner of 20% or more of
the outstanding Common Shares of the Company. Notwithstanding the foregoing, the term
Acquiring Person shall not include:
 (i)
    
    the Company or any Subsidiary of the Company;(ii)
    
    any Person who becomes the Beneficial Owner of 20% or more of the outstanding
Common Shares of the Company as a result of any one or any combination of:
 (a)
    
    an acquisition and cancellation or redemption by the Company or a
Subsidiary of the Company of Common Shares which, by reducing the number of
Common Shares outstanding, increases the percentage of outstanding Common
Shares Beneficially Owned by such Person to 20% or more of the Common Shares
outstanding (a Share Reduction);(b)
    
    an acquisition of Common Shares made pursuant to a Permitted Bid or a
Competing Permitted Bid (a Permitted Bid Acquisition);(c)
    
    an acquisition of Common Shares in respect of which the Board of
Directors has waived the application of section 4.1 pursuant to the
provisions of section 6.1 (an Exempt Acquisition);(d)
    
    a Convertible Security Acquisition; or
  - 2 -




---



##### 



(e)
    
    a Permitted Acquisition;
 provided, however, that if a Person shall become the Beneficial Owner of 20%
or more of the Common Shares of the Company then outstanding by reason of one
or any combination of a Share Reduction, a Permitted Bid Acquisition, an
Exempt Acquisition, a Convertible Security Acquisition or a Permitted
Acquisition and thereafter such Person, while such Person is the Beneficial
Owner of 20% or more of the Common Shares of the Company then outstanding,
increases the number of Common Shares of the Company beneficially owned by
such Person by more than 1% of the number of Common Shares outstanding (other
than pursuant to one or any combination of a Share Reduction, a Permitted Bid
Acquisition, an Exempt Acquisition, a Convertible Security Acquisition or a
Permitted Acquisition) then, as of the date such Person becomes the Beneficial
Owner of such additional outstanding Common Shares of the Company, such Person
shall be an Acquiring Person;(iii)
    
    for a period of 10 days after the Disqualification Date
(as hereinafter defined), any Person who becomes the Beneficial Owner of
20% or more of the outstanding Common Shares of the Company as a result
of such Person becoming disqualified from relying on clause 1.1(f)(v)
hereof because such Person makes or announces an intention to make a
Take-over Bid in respect of the Common Shares of the Company alone or by
acting jointly or in concert with any other Person and, for this purpose,
Disqualification Date means the first date of public announcement of
facts indicating that such Person is making or intends to make a
Take-over Bid;(iv)
    
    an underwriter or member of a banking or selling group acting in such capacity
that becomes the Beneficial Owner of 20% or more of the Common Shares of the Company
in connection with a distribution of securities of the Company; or(v)
    
    a Person (a Grandfathered Person) who is the Beneficial Owner of more than 20%
of the outstanding Common Shares of the Company determined as of the Record Time;
provided, however, that this exemption shall not be, and shall cease to be, applicable
to a Grandfathered Person in the event that such Grandfathered Person shall, after the
Record Time, become the Beneficial Owner of additional Common Shares of the Company
that increases its Beneficial Ownership by more than 1% of the number of Common Shares
of the Company outstanding (other than through one or any combination of a Share
Reduction, a Permitted Bid Acquisition, an Exempt Acquisition, a Convertible Security
Acquisition or a Permitted Acquisition);
 (d)
    
    Affiliate, when used to indicate a relationship with a specified corporation, means a
Person who directly, or indirectly through one or more controlled
  - 3 -




---



##### 



intermediaries, controls, or is controlled by, or is under common control with,
such specified corporation;(e)
    
    Associate of a specified Person shall mean any Person to whom such specified Person is
married or with whom such specified Person is living in a conjugal relationship outside
marriage, or any relative of such specified Person, said spouse or other Person who has the
same home as such specified Person;(f)
    
    a Person shall be deemed the Beneficial Owner of, and to have Beneficial Ownership
of, and to Beneficially Own:
 (i)
    
    any securities as to which such Person or any of such Persons Affiliates
or Associates is the owner at law or equity;(ii)
    
    any securities as to which such Person or any of such Persons Affiliates
or Associates has the right to acquire (where such right is exercisable within a
period of 60 days, or upon the occurrence of a contingency) (a) upon the exercise
of any Convertible Securities (other than a Right) or (b) pursuant to any
agreement, arrangement, pledge or understanding, whether or not in writing (other
than customary agreements with and between underwriters or banking group or
selling group members with respect to a distribution of securities and other than
pledges or hypothecs of securities in the ordinary course of business); and(iii)
    
    any securities which are Beneficially Owned within the meaning of the foregoing
provisions of this subsection 1.1(f) by any other Person with whom such Person is
acting jointly or in concert;
 provided, however, that a Person shall not be deemed the Beneficial Owner of or to
have Beneficial Ownership of, or to Beneficially Own, any security because:
 (iv)
    
    such security has been agreed to be deposited or tendered pursuant to a Lock-up
Agreement or is otherwise deposited or tendered pursuant to any Take-over Bid made by
such Person, made by any of such Persons Affiliates or Associates or made by any
Person acting jointly or in concert with such Person until such deposited security has
been taken up or paid for, whichever shall occur first;(v)
    
    such Person holds such security, provided that:
 (a)
    
    the ordinary business of such Person (an Investment Manager) includes
the management of mutual funds or investment funds for others (which others,
for greater certainty, may include or be limited to one or more employee
benefit plans or pension plans) and such security is held by the Investment
Manager in the ordinary course of such business in the performance of such
Investment Managers duties for the account of any other Person or
  - 4 -




---



##### 



Persons (a Client) including non-discretionary accounts held
on behalf of a broker or dealer registered under applicable laws; or(b)
    
    such Person (a Trust Company) is licensed to carry on the business of a
trust company under applicable laws and, as such, acts as trustee or
administrator or in a similar capacity in relation to the estates of deceased
or incompetent Persons (Estate Accounts) or in relation to other accounts
(Other Accounts) and holds such security in the ordinary course of such
duties for the estate of any such deceased or incompetent Person or for such
Estate Accounts or Other Accounts; or(c)
    
    such Person (an Administrator) is the administrator or the trustee of
one or more pension funds or plans (each a Plan) or is a Plan registered
under applicable laws and holds such security in the ordinary course of such
duties for such Plan; or(d)
    
    such Person is a Plan or is a Person established by statute (the
Statutory Body) for purposes that include, and the ordinary business or
activity of such Person includes, the management of investment funds for
employee benefit plans, pension plans, insurance plans (other than plans
administered by insurance companies) of various public bodies and the
Statutory Body holds such security for the purposes of its activities as such;
or(e)
    
    such Person is a Crown agent or agency;
 provided that the Investment Manager, Trust Company, Administrator, the Plan,
the Statutory Body or the Crown agent or agency, as the case may be, is not
then making or has not announced a current intention to make a Take-over Bid,
alone or acting jointly or in concert with any other Person (other than an
Offer to Acquire Shares of the Company by means of a distribution by the
Company or by means of ordinary market transactions (including pre-arranged
trades) executed through the facilities of a stock exchange or organized
over-the-counter market);(vi)
    
    such Person, any of such Persons Affiliates or Associates or any Person acting
jointly or in concert with such Person is a Client of the same Investment Manager as
another Person on whose account the Investment Manager holds such security, or by
reason of such Person being an Estate Account or an Other Account of the same Trust
Company as another Person on whose account the Trust Company holds such security or
by reason of such Person being a Plan which has an Administrator which is also a
trustee for another Plan on whose account the Trustee holds such security;
  - 5 -




---



##### 



(vii)
    
    such Person is (i) a Client of an Investment Manager and such security is
owned at law or in equity by the Investment Manager, or (ii) an account of a Trust
Company and such security is owned at law or in equity by the Trust Company, or (iii)
a Plan and such security is owned at law or in equity by the Administrator thereof; or(viii)
    
    such Person is the registered holder of securities as a result of carrying on
the business of a securities depositary or as a result of being a nominee holder of
such securities.
 (g)
    
    Board of Directors shall mean the board of directors of the Company or, if duly
constituted and whenever duly empowered, the executive committee of the board of directors of
the Company;(h)
    
    Business Day shall mean any day other than a Saturday, a Sunday or a day on which
banking institutions in Montreal, Québec are authorized or obligated by law to close;(i)
    
    Canadian Dollar Equivalent of any amount which is expressed in United States dollars
shall mean on any date the Canadian dollar equivalent of such amount determined by
multiplying such amount by the U.S.-Canadian Exchange Rate in effect on such date;(j)
    
    Canadian-U.S. Exchange Rate shall mean on any date the inverse of the U.S.-Canadian
Exchange Rate;(k)
    
    Close of Business on any date shall mean the time on such date (or, if such date is not
a Business Day, the time on the next succeeding Business Day) at which the offices of the
transfer agent for the Shares (or, after the Separation Time, the offices of the Rights Agent
in Montreal, Québec) are closed to the public in the city in which such transfer agent or
Rights Agent has an office for the purposes of this Agreement;(l)
    
    Common Share when used with reference to the Company, shall mean the Common Shares
and/or any other shares entitled to vote generally in the election of directors, as the
context requires, and, when used with reference to any Person other than the Company, shall
mean shares of capital stock of such other Person entitled to vote generally in the election
of the directors of such other Person.(m)
    
    Companies Act shall mean the Companies Act (Québec), as amended, and the regulations
made thereunder, and any comparable or successor laws or regulations thereto;(n)
    
    Competing Permitted Bid means a Take-over Bid that is made by means of a Take-over Bid
circular and which also complies with the following additional provisions:
  - 6 -




---



##### 



(i)
    
    the Take-over Bid is made after a Permitted Bid has been made and
prior to the expiry of the Permitted Bid or of any other Competing Permitted
Bids (in this definition the Prior Bids);(ii)
    
    the Take-over Bid satisfies all components of the definition of a Permitted Bid
other than the requirements set out in clause (ii) of such definition; and(iii)
    
    the Take-over Bid contains, and the take-up and payment for Common Shares
tendered or deposited thereunder are subject to, irrevocable and unqualified
conditions that no Common Shares will be taken up and paid for pursuant to such
Take-over Bid (x) prior to the Close of Business on a date that is no earlier than the
later of (1) the earliest date on which Common Shares may be taken up and paid for
under any Prior Bids in existence when the Take-over Bid is made and (2) 35 days after
the date of such Take-over Bid constituting the Competing Permitted Bid, and (y)
unless, at the time that the Common Shares are to be taken up, more than 50% of the
then outstanding Common Shares held by Independent Shareholders, have been deposited
or tendered pursuant to such Take-over Bid and not withdrawn;
 (o)
    
    controlled: a corporation is controlled by another Person or two or more Persons,
acting jointly or in concert, if:
 (i)
    
    securities entitled to vote in the election of directors carrying more than 50% of
the votes for the election of the directors are held, directly or indirectly, by or
for the benefit of the other Person or Persons acting jointly or in concert; and(ii)
    
    the votes carried by such securities are entitled, if exercised, to elect a
majority of the board of directors of such corporation;
 and controls, controlling and under common control with shall be interpreted
accordingly;(p)
    
    Convertible Securities means at any time any securities issued by the Company from time
to time (other than the Rights) carrying any exercise, conversion or exchange right pursuant
to which the holder thereof may acquire Common Shares or other securities which are
convertible into exercisable or exchangeable for Common Shares.(q)
    
    Convertible Securities Acquisition means the acquisition of Common Shares upon the
exercise of a Convertible Security received by a Person pursuant to a Permitted Bid
Acquisition, an Exempt Acquisition or a Permitted Acquisition.(r)
    
    dividends paid in the ordinary course shall mean cash dividends paid at regular
intervals in any financial year of the Company to the extent that such cash dividends do not
exceed, in the aggregate, the greatest of:
  - 7 -




---



##### 



(i)
    
    200% of the aggregate amount of cash dividends declared payable by the
Company on its Shares in its immediately preceding financial year;(ii)
    
    300% of the arithmetic average of the aggregate amounts of cash dividends
declared payable by the Company on its Shares in its three immediately preceding
financial years;(iii)
    
    100% of the aggregate consolidated net income of the Company, before
extraordinary items, for its immediately preceding financial year; and(iv)
    
    100% of the aggregate consolidated net income of the Company, before
extraordinary items, for its current financial year;
 (s)
    
    Effective Date shall mean the time at which the annual and special meeting of the
holders of Common Shares scheduled to be held on March 25, 2010 terminates;(t)
    
    Election to Exercise shall have the meaning ascribed thereto in clause 3.1(e)(ii);(u)
    
    Exempt Acquisition shall have the meaning ascribed thereto in subclause 1.1(c)(ii)(c);(v)
    
    Exercise Price shall mean, as of any date, the price at which a holder of a Right may
purchase Common Shares issuable upon exercise of such Right. Subject to adjustment thereof in
accordance with the terms hereof, the Exercise Price for each Right shall be $25.00;(w)
    
    Expiration Time shall mean the earlier of:
 (i)
    
    the Termination Time;(ii)
    
    the termination of the annual meeting of the shareholders of the Company in the
year 2013; and(iii)
    
    the Close of Business on the date this Agreement becomes void pursuant to the
provisions of section 6.15;
 (x)
    
    Flip-in Event shall mean a transaction in or pursuant to which any Person shall become
an Acquiring Person provided, however, that a Flip-in Event shall be deemed to occur at the
Close of Business on the tenth day (or on such later day as the Board of Directors shall
determine) after a Stock Acquisition Date;(y)
    
    Grandfathered Person shall have the meaning ascribed thereto in clause 1.1(c)(v);(z)
    
    Independent Shareholders shall mean all holders of Common Shares of the Company, other
than (i) any Acquiring Person, (ii) any Offeror other than a
  - 8 -




---



##### 



Person described in paragraph (v) of the definition of Beneficial Owner, (iii) any
Affiliate or Associate of any Acquiring Person or Offeror, (iv) any Person acting
jointly or in concert with any Acquiring Person or Offeror, and (v) any Person who is
an administrator or trustee of any employee benefit plan, deferred profit sharing
plan, stock participation plan or any similar plan or trust for the benefit of
employees of the Company or a wholly-owned Subsidiary of the Company, unless the
beneficiaries of such plan or trust direct the manner in which such Common Shares are
to be voted or direct whether the Common Shares are to be tendered to a Take-over Bid;(aa)
    
    Lock-up Agreement means an agreement between an Offeror, any of its Affiliates or
Associates or any other Person acting jointly or in concert with the Offeror and a Person
(the Locked-up Person) who is not an Affiliate or Associate of the Offeror or a Person
acting jointly or in concert with the Offeror whereby the Locked-up Person agrees to deposit
or tender the Common Shares by the Locked-up Person to the Offerors Take-over Bid or to any
Take-over Bid made by any of the Offerors Affiliates or Associates or made by any other
Person acting jointly or in concert with the Offeror (the Subject Bid), where (A) in the
context of a Subject Bid that is supported by the Company, the agreement shall terminate
automatically or may be terminated by the Locked-up Person upon termination, in accordance
with its terms, of the agreement between the Offeror, any of its Affiliates or Associates or
any other Person acting jointly or in concert with the Offeror and the Company, under which
it was agreed that the Offeror or any Affiliates or Associates or any other Person acting
jointly or in concert with the Offeror would acquire all of the Common Shares outstanding in
accordance with the terms of the agreement, (B) in the context of a Subject Bid that is not
supported by the Company, where the agreement:
 (i)
    
    permits the Locked-up Person to withdraw the Common Shares from the agreement in
order to tender or deposit the Common Shares to another Take-over Bid or to support
another transaction that in either case will provide greater value to the Locked-up
Person than the Subject Bid; or(ii)
    
    (a) permits the Locked-up Person to withdraw the Common Shares from the agreement
in order to tender or deposit the Common Shares to another Take-over Bid or to support
another transaction that contains an offering price for each Common Share that exceeds
by as much as or more than a specified amount (the Specified Amount) the offering
price for each Common Share contained in or proposed to be contained in the Subject
Bid; and (b) does not by its terms provide for a Specified Amount that is greater than
7% of the offering price contained in or proposed to be contained in the Subject Bid;
and(iii)
    
    does not provide for any break-up fees, top-up fees, penalties, expenses or
other amounts that exceed in the aggregate the greater of:
  - 9 -




---



##### 



(a)
    
    the cash equivalent of 2.5% of the price or value payable under the
Take-over Bid to a Locked-up Person; and(b)
    
    50% of the amount by which the price or value payable under another
Take-over Bid or transaction to a Locked-up Person exceeds the price or value
of the consideration that such Locked-up Person would have received under the
Take-over Bid;
 which shall be payable by a Locked-up Person pursuant to the Lock-up Agreement
in the event a Locked-up Person fails to deposit or tender Common Shares to
the Take-over Bid or withdraws Common Shares in order to accept the other
Take-over Bid or support another transaction;
 and for a greater clarity an agreement may contain a right of first refusal or require
a period of delay to give an offeror an opportunity to match a higher price in another
Take-over Bid or other similar limitation on a Locked-up Person as
long as the Locked-up
Person can accept another bid or tender to another transaction;(bb)
    
    Market Price per share of any securities on any date of determination shall mean the
weighted average trading price per share of such securities (determined as described below)
for the 20 consecutive Trading Days through and including the Trading Day immediately
preceding such date; provided, however, that if an event of a type analogous to any of the
events described in section 3.2 shall have caused the sale prices in respect of any Trading
Day used to determine the Market Price not to be fully comparable with the sale prices on
such date of determination or, if the date of determination is not a Trading Day, on the
immediately preceding Trading Day, each such sale price so used shall be appropriately
adjusted in a manner analogous to the applicable adjustment provided for in section 3.2 in
order to make it fully comparable with the sale price on such date of determination or, if
the date of determination is not a Trading Day, on the immediately preceding Trading Day.
The weighted average trading price per share of any securities on any date shall be
determined by dividing the aggregate sale price of all securities sold on the principal stock
exchange in Canada on which such securities are listed and posted for trading divided by the
total number of securities so sold; and
 (i)
    
    if for any reason such prices are not available on such day or the securities are
not listed and posted for trading on any stock exchange in Canada, the Market Price
shall be calculated using the sale prices for such securities as reported in the
principal consolidated transaction reporting system with respect to securities listed
or admitted to trading on the principal national securities exchange in the United
States on which such securities are listed or admitted to trading;(ii)
    
    if for any reason such prices are not available on such day or the securities are
not listed and posted for trading on a stock exchange in Canada or a
  - 10 -




---



##### 



national securities exchange in the United States, the Market Price
shall be calculated using the average of the high bid and low asked prices of
each share of such securities in the over-the-counter market, as reported by
The National Association of Securities Dealers, Inc. or such other comparable
system then in use; or(iii)
    
    if on any such date the securities are not quoted by any such organization, the
Market Price shall be calculated using the average of the closing bid and asked prices
as furnished by a professional market maker making a market in the securities;
 provided, however, that if on any such date the securities are not traded on any
exchange or in the over-the-counter market and the price referred to in clause
1.1(aa)(iii) is not available, the closing price per share of such securities on such
date shall mean the fair value per share of such securities on such date as determined
by a nationally or internationally recognized investment dealer or investment banker
with respect to the fair value per share of such securities. The Market Price shall be
expressed in Canadian dollars and if initially determined in respect of any day
forming part of the 20 consecutive Trading Day period in question in United States
dollars, such amount shall be translated into Canadian dollars on such date at the
Canadian Dollar Equivalent thereof;(cc)
    
    Offer to Acquire shall include:
 (i)
    
    an offer to purchase, or a solicitation of an offer to sell Common Shares; and(ii)
    
    an acceptance of an offer to sell Common Shares, whether or not such offer to
sell has been solicited;
 or any combination thereof, and the Person accepting an offer to sell shall be deemed
to be making an Offer to Acquire to the Person who made the offer to sell;(dd)
    
    Offeror shall mean a Person who has announced a current intention to make or who is
making a Take-over Bid (including a Permitted Bid or a Competing Permitted Bid) but only so
long as the Take-over Bid so made or announced has not been withdrawn or terminated or has
not expired;(ee)
    
    Permitted Acquisition shall mean an acquisition of Common Shares of the Company by a
Person
 (i)
    
    as a result of a stock dividend, a stock split or other event pursuant to which
such Person receives or acquires Common Shares of the Company or Convertible
Securities on the same pro rata basis as all other holders of Common Shares, or
  - 11 -




---



##### 



(ii)
    
    pursuant to a regular dividend reinvestment or other plan of the Company
made available by the Company to the holders of Common Shares of the Company, or(iii)
    
    pursuant to the receipt and/or exercise of rights issued by the Company to all
of the holders of Common Shares of the Company to subscribe for or purchase Common
Shares of the Company or Convertible Securities, provided that such rights are
acquired directly from the Company and not from any other Person, provided that the
Person does not thereby acquire a greater percentage of Common Shares than the
Persons percentage of Common Shares Beneficially Owned immediately prior to such
acquisition or exercise; or(iv)
    
    pursuant to a distribution to the public by the Company of Common Shares, or
securities convertible into or exchangeable for Common Shares or Convertible
Securities, pursuant to a prospectus, provided that the Person does not thereby
acquire a greater percentage of such Common Shares or Convertible Securities or
securities convertible into or exchangeable for Common Shares or Convertible
Securities, so offered than the Persons percentage of Common Shares Beneficially
Owned immediately prior to such acquisition or to an amalgamation, merger or other
statutory procedure requiring shareholders approval; or(v)
    
    pursuant to a distribution by the Company of Common Shares or Convertible
Securities by way of a private placement by the Company or upon the exercise by an
individual employee of stock options granted under a stock option plan of the Company
or rights to purchase securities granted under a share purchase plan of the Company,
provided that (1) all necessary stock exchange approvals for such private placement,
stock option plan or share purchase plan have been obtained and such private
placement, stock option plan or share purchase plan complies with the terms and
conditions of such approvals and (2) such Person does not become the Beneficial Owner
of more than 25% of the Common Shares outstanding immediately prior to the
distribution, and in making this determination the Common Shares to be issued to such
Person in the distribution shall be deemed to be held by such Person but shall not be
included in the aggregate number of outstanding Common Shares immediately prior to the
distribution;
 (ff)
    
    Permitted Bid means a Take-over Bid that is made by means of a Take-over Bid circular
and that also complies with the following additional provisions:
 (i)
    
    the Take-over Bid is made to all holders of Common Shares of the Company as
registered on the books of the Company, other than the Offeror;
  - 12 -




---



##### 



(ii)
    
    the Take-over Bid contains, and the take-up and payment for Common
Shares tendered or deposited thereunder are subject to, an irrevocable and
unqualified condition that no Common Shares shall be taken up and paid for
pursuant to the Take-over Bid prior to the Close of Business on the date
which is not less than 60 days after the date of the Take-over Bid and only
if at such date more than 50% of the Common Shares then outstanding held by
Independent Shareholders, shall have been deposited or tendered pursuant to
the Take-over Bid and not withdrawn;(iii)
    
    the Take-over Bid contains an irrevocable and unqualified provision that, unless
the Take-over Bid is withdrawn, Common Shares may be deposited pursuant to such
Take-over Bid at any time during the period of time between the date of the Take-over
Bid and the date on which the Common Shares may be taken up and paid for and that any
such shares deposited pursuant to the Take-over Bid may be withdrawn until taken up
and paid for; and(iv)
    
    the Take-over Bid contains an irrevocable and unqualified provision that
in the event that more than 50% of the Common Shares then outstanding held by
Independent Shareholders shall have been deposited to the Take-over Bid as at the
date of first take-up or payment for Common Shares under the Take-over Bid, the
Offeror will make a public announcement of that fact and the Take-over Bid will
remain open for deposits and tenders of Common Shares for not less than 10
Business Days from the date of such public announcement;
 (gg)
    
    Permitted Bid Acquisition shall have the meaning ascribed thereto in subclause
1.1(c)(ii)(b);(hh)
    
    Person shall include any individual, body corporate, firm, partnership, association,
cooperative, trust, trustee, executor, administrator, legal personal representative, group,
unincorporated organization, syndicate, government or governmental agency or instrumentality,
or any other entity;(ii)
    
    Record Time shall mean 6:00 p.m. (Montreal time) on February 9,
2010;(jj)
    
    Right shall have the meaning ascribed thereto in the
recitals hereto; (kk) Rights Agent shall mean Computershare Trust
Company of Canada;(ll)
    
    Rights Certificates shall mean the certificates representing the Rights after the
Separation Time, which shall be in the form attached hereto as Exhibit A;(mm)
    
    Rights Register and Rights Registrar shall have the respective meanings ascribed
thereto in subsection 2.3(a);
  - 13 -




---



##### 



(nn)
    
    Securities Act(Ontario) shall mean the Securities Act, R.S.O. 1990, c.
S.5, as amended, and the regulations thereunder, and any comparable or successor laws or
regulations thereto;(oo)
    
    Securities Act(Québec) shall mean the Securities Act, R.S.Q. c. V-1.1, as amended,
and the regulations thereunder, and any comparable or successor laws or regulations thereto;(pp)
    
    Separation Time shall mean, subject to subsection 6.1(f), the Close of Business on the
tenth Business Day after the earlier of:
 (i)
    
    the Stock Acquisition Date;(ii)
    
    the date of the commencement of, or first public announcement of the intent of
any Person (other than the Company or any Subsidiary of the Company) to commence a
Take-over Bid (other than a Permitted Bid or a Competing Permitted Bid, as the case
may be); and(iii)
    
    the date on which a Permitted Bid or Competing Permitted Bid ceases to qualify
as such;
 or such later time as may be determined by the Board of Directors acting in good
faith; provided that if the Take-over Bid expires, or is cancelled, terminated or
otherwise withdrawn prior to the Separation Time, such Take-over Bid shall be deemed,
for the purposes of this subsection 1.1(mm), never to have been made and provided
further that if the Board of Directors determines pursuant to section 6.1 hereof to
waive the application of section 4.1 to a Flip-in Event, the Separation Time in
respect of such Flip-in Event shall be deemed never to have occurred;(qq)
    
    Shares shall mean the shares in the capital of the Company;(rr)
    
    Share Reduction shall have the meaning ascribed thereto in subclause 1.1(c)(ii)(a);(ss)
    
    Stock Acquisition Date shall mean the date of the first public announcement (which for
the purposes of this definition shall include, without limitation, the filing of a report
pursuant to the Securities Act(Ontario) or pursuant to the Securities Act(Québec) or
section 13(d) under the the 1934 Exchange Act) by the Company or an Acquiring Person of facts
indicating that a Person has become an Acquiring Person;(tt)
    
    Subsidiary of a Person shall have the meaning ascribed thereto in the Securities Act
(Ontario);(uu)
    
    Take-over Bid shall mean an Offer to Acquire Common Shares of the Company or other
securities convertible into Common Shares of the Company, where the Common Shares or other
securities of the Company subject to the Offer
  - 14 -




---



##### 



to Acquire are acquired at the date of such Offer to Acquire by the Person
making such Offer to Acquire, together with the Common Shares Beneficially Owned by
the Person making the Offer to Acquire would constitute in the aggregate 20% or more
of the outstanding Common Shares of the Company;(vv)
    
    Termination Time shall mean the time at which the right to exercise Rights shall
terminate pursuant to subsection 6.1(e) or section 6.15;(ww)
    
    Trading Day, when used with respect to any securities, shall mean a day on which the
principal United States or Canadian securities exchange on which such securities are listed
or admitted to trading is open for the transaction of business or, if the securities are not
listed or admitted to trading on any United States or Canadian securities exchange, a
Business Day;(xx)
    
    US.-Canadian Exchange Rate shall mean on any date:
 (i)
    
    if on such date the Bank of Canada sets an average noon spot rate of exchange
for the conversion of one United States dollar into Canadian dollars, such rate; and(ii)
    
    in any other case, the rate for such date for the conversion of one United
States dollar into Canadian dollars which shall be calculated in the manner
determined by the Board of Directors from time to time acting in good faith;
 (yy)
    
    US. Dollar Equivalent of any amount which is expressed in Canadian dollars shall mean
on any date the United States dollar equivalent of such amount determined by multiplying
such amount by the Canadian-U.S. Exchange Rate in effect on such date.
 1.2 Currency
  1.3 Descriptive Headings
  1.4 References to Agreement
   - 15 -




---



##### 



1.5
    
    Calculation of Number and Percentage of Beneficial Ownership of Outstanding Common
Shares
 (a)
    
    For the purposes of this Agreement, in determining the percentage of the outstanding
Common Shares of the Company with respect to which a Person is or is deemed to be the
Beneficial Owner, all unissued Common Shares of the Company of which such Person is deemed
to be the Beneficial Owner shall be deemed to be outstanding.(b)
    
    The percentage of outstanding Common Shares of the Company Beneficially Owned by any
Person shall, for the purposes of this Agreement, be and be deemed to be the product
determined by the formula:100 x A          B
 where: A =
    
    the number of votes for the election of all directors generally attaching
to the Common Shares Beneficially Owned by such Person; andB =
    
    the number of votes for the election of all directors generally attaching
to all outstanding Common Shares of the Company.
 1.6
    
    Acting Jointly or in Concert
  1.7
    
    Application of Statutes, Regulations and Rules
  ARTICLE 2
THE RIGHTS
 2.1
    
    Legend on Certificates
   - 16 -




---



##### 



UNTIL THE SEPARATION TIME (AS DEFINED IN THE RIGHTS AGREEMENT REFERRED TO BELOW), THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS SET FORTH IN
A SHAREHOLDER RIGHTS PLAN AGREEMENT, DATED AS OF THE 10th DAY OF FEBRUARY, 2010
(THE RIGHTS AGREEMENT) BETWEEN THERATECHNOLOGIES INC. (THE COMPANY) AND COMPUTERSHARE
TRUST COMPANY OF CANADA, AS RIGHTS AGENT, (AS THE SAME MAY BE AMENDED OR SUPPLEMENTED FROM
TIME TO TIME IN ACCORDANCE WITH THE TERMS THEREOF) THE TERMS OF WHICH ARE HEREBY
INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH MAY BE INSPECTED DURING NORMAL BUSINESS
HOURS AT THE HEAD OFFICE OF THE COMPANY. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE
RIGHTS AGREEMENT SUCH RIGHTS MAY BE TERMINATED, MAY EXPIRE, MAY BECOME VOID (IF, IN CERTAIN
CASES, THEY ARE BENEFICIALLY OWNED BY AN ACQUIRING PERSON, AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT, WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR ANY
SUBSEQUENT HOLDER) OR MAY BE EVIDENCED BY SEPARATE CERTIFICATES AND MAY NO LONGER BE
EVIDENCED BY THIS CERTIFICATE. THE COMPANY WILL MAIL OR ARRANGE FOR THE MAILING OF A COPY
OF THE RIGHTS AGREEMENT TO THE HOLDER OF THIS CERTIFICATE WITHOUT CHARGE AS SOON AS IS
PRACTICABLE UPON RECEIPT OF A WRITTEN REQUEST THEREFOR.
  2.2
    
    Execution, Authentication, Delivery and Dating of Rights Certificates
 (a)
    
    The Rights Certificates shall be executed on behalf of the Company by any of the
Chairman of the Board, the President and Chief Executive Officer or the Vice President,
Finance and Chief Financial Officer, together with any other of such persons or together
with any one of the Secretary or any other officer of the Company. The signature of any
such officers of the Company on the Rights
Certificates may be manual or facsimile. Rights Certificates bearing the manual or
facsimile signatures of individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the countersignature and delivery of such
Rights Certificates.(b)
    
    Promptly after the Company learns of the Separation Time, the Company will notify the
Rights Agent of such Separation Time and will deliver Rights Certificates executed by the
Company to the Rights Agent for countersignature and disclosure statement describing the
Rights, and the Rights Agent shall
  - 17 -




---



##### 



manually (or by facsimile signature in a manner satisfactory to the Company)
countersign and deliver such Rights Certificates to the holders of the Rights
pursuant to subsection 3.1(d). No Rights Certificate shall be valid for any purpose
until countersigned by the Rights Agent as aforesaid.(c)
    
    Each Rights Certificate shall be dated the date of the countersignature thereof.
 2.3
    
    Registration, Registration of Transfer and Exchange
 (a)
    
    After the Separation Time, the Company will cause to be kept a register (the Rights
Register) in which, subject to such reasonable regulations as it may prescribe, the Company
will provide for the registration and transfer of Rights.
The Rights Agent is hereby appointed the Rights Registrar for the purpose of
maintaining the Rights Register for the Company and registering Rights and transfers
of rights as herein provided. In the event that the Rights Agent shall cease to be
the Rights Registrar, the Rights Agent will have the right to examine the Rights
Register at all reasonable times. After the Separation Time and prior to the
Expiration Time, upon surrender for registration of transfer or exchange of any
Rights Certificate, and subject to the provisions of subsection 2.3(c), the Company
will execute, and the Rights Agent will countersign, register and deliver, in the
name of the holder or the designated transferee or transferees, as required pursuant
to the holders instructions, one or more new Rights Certificates evidencing the
same aggregate number of Rights as did the Rights Certificates so surrendered.(b)
    
    All Rights issued upon any registration of transfer or exchange of Rights Certificates
shall be valid obligations of the Company, and such Rights shall be entitled to the same
benefits under this Agreement as the Rights surrendered upon such registration of transfer
or exchange.(c)
    
    Every Rights Certificate surrendered for registration of transfer or exchange shall be
duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to
the Company or the Rights Agent, as the case may be, duly executed by the holder thereof or
such holders attorney duly authorized in writing. As a condition to the issuance of any new
Rights Certificate under this section 2.3, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Rights Agent) in
connection therewith.
 2.4
    
    Mutilated, Destroyed, Lost and Stolen Rights Certificates
 (a)
    
    If any mutilated Rights Certificate is surrendered to the Rights Agent prior to the
Expiration Time, the Company shall execute and the Rights Agent shall manually countersign
and deliver in exchange therefor a new Rights Certificate evidencing the same number of
Rights as the Rights Certificate so surrendered.
  - 18 -




---



##### 



(b)
    
    If there shall be delivered to the Company and the Rights Agent prior to the Expiration
Time: (i) evidence to their satisfaction of the destruction, loss or theft of any Rights
Certificate; and (ii) such security or indemnity as may be required by each of them to save
each of them and any of their agents harmless, then, in the absence of notice to the Company
or the Rights Agent that such Rights Certificate has been acquired by a bona fide purchaser,
the Company shall execute and upon its request the Rights Agent shall countersign and
deliver, in lieu of any such destroyed, lost or stolen Rights Certificate, a new Rights
Certificate evidencing the same number of Rights as did the Rights Certificate so destroyed,
lost or stolen.(c)
    
    As a condition to the issuance of any new Rights Certificate under this section 2.4, the
Company may require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Rights Agent) in connection therewith.(d)
    
    Every new Rights Certificate issued pursuant to this section 2.4 in lieu of any
destroyed, lost or stolen Rights Certificate shall evidence the contractual obligation of
the Company, whether or not the destroyed, lost or stolen Rights Certificate shall be at any
time enforceable by anyone, and shall be entitled to all the benefits of this Agreement
equally and proportionately with any and all other Rights duly issued by the Company.
 2.5
    
    Persons Deemed Owners of Rights
  2.6
    
    Delivery and Cancellation of Certificates
   - 19 -




---



##### 



2.7
    
    Agreement of Rights Holders
  (a)
    
    to be bound by and subject to the provisions of this Agreement, as amended from time to
time in accordance with the terms hereof, in respect of the Rights held;(b)
    
    that prior to the Separation Time, each Right will be transferable only together with,
and will be transferred by a transfer of, the associated Common Share;(c)
    
    that after the Separation Time, the Rights Certificates will be transferable only upon
registration of the transfer on the Rights Register as provided herein;(d)
    
    that prior to due presentment of a Rights Certificate (or, prior to the Separation Time,
the associated Common Share certificate) for registration of transfer, the Company, the
Rights Agent and any agent of the Company or the Rights Agent may deem and treat the Person
in whose name the Rights Certificate (or, prior to the Separation Time, the associated
Common Share certificate) is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or writing on such Rights
Certificate or the associated Common Share certificate, made by anyone other than the
Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent shall be affected by any notice to the contrary;(e)
    
    that such holder of Rights is not entitled to receive any fractional Rights or any
fractional Common Shares upon exercise of a Right (except as provided herein);(f)
    
    that without the approval of any holder of Rights and upon the sole authority of the
Board of Directors acting in good faith, this Agreement may be supplemented or amended from
time to time pursuant to and as provided herein; and(g)
    
    notwithstanding anything in this Agreement to the contrary, neither the Company nor the
Rights Agent and their respective directors and officers shall have any liability to any
holder of a Right or any other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent injunction or
other order, decree 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 such governmental or regulatory
authority, prohibiting or otherwise restraining performance of such obligation.
 2.8
    
    Rights Certificate Holder Not Deemed a Shareholder
   - 20 -




---



##### 



ARTICLE 3
EXERCISE OF THE RIGHTS
 3.1
    
    Initial Exercise Price, Exercise of Rights, Detachment of Rights
 (a)
    
    Subject to adjustment as herein set forth, from and after the Separation Time and prior
to the Expiration Time, each Right will entitle the holder thereof to purchase one Common
Share for the Exercise Price (or its U.S. Dollar Equivalent) as at the Close of Business on
the day immediately preceding the date of the exercise of the Right (which Exercise Price
and number of Common Shares are subject to adjustment as set forth below). Notwithstanding
any other provision of this Agreement, any Rights held by the Company or any of its
Subsidiaries shall be void.(b)
    
    Until the Separation Time:
 (i)
    
    the Rights shall not be exercisable and no Right may be exercised; and(ii)
    
    each Right will be evidenced by the certificate for the associated Common Share
registered in the name of the holder thereof (which certificate shall also be deemed
to be a Rights Certificate) and will be transferable only together with, and will be
transferred by a transfer of, such associated Common Share.
 (c)
    
    From and after the Separation Time and prior to the Expiration Time:
 (i)
    
    the Rights shall be exercisable; and(ii)
    
    the registration and transfer of the Rights shall be separate from and
independent of the Common Shares.
 (d)
    
    Promptly following the Separation Time, the Company will prepare and the Rights Agent
will mail to each holder of record of Common Shares as of the Separation Time (other than an
Acquiring Person and other than, in respect of any Rights Beneficially Owned by such
Acquiring Person which are not held of record by such Acquiring Person, the holder of record
of such Rights (a Nominee)), at such holders address as shown by the records of the
Company (and the Company hereby agrees to furnish copies of such records to the Rights Agent
for this purpose):
  - 21 -




---



##### 



(i)
    
    a Rights Certificate representing the number of Rights held by such holder at the
Separation Time in substantially the form of Exhibit A hereto, appropriately completed
and having such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to comply
with any law, rule, regulation or judicial or administrative order or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock exchange
or quotation system on which the Rights may from time to time be listed or traded, or
to conform to usage; and(ii)
    
    a disclosure statement describing the Rights;
 provided that a Nominee shall be sent the materials provided for in clauses 3.1(d)(i)
and 3.1(d)(ii) only in respect of all Common Shares held of record by it which are not
Beneficially Owned by an Acquiring Person.(e)
    
    Rights may be exercised in whole or in part on any Business Day after the Separation Time
and prior to the Expiration Time by submitting to the Rights Agent:
 (i)
    
    the Rights Certificate evidencing such Rights;(ii)
    
    an election to exercise such Rights (an Election to Exercise), substantially in
the form attached to the Rights Certificate, duly completed and executed by the holder
or his executors or administrators or other personal representatives or his or their
legal attorney duly appointed by an instrument in writing in form and executed in a
manner satisfactory to the Rights Agent; and(iii)
    
    payment by certified cheque, bankers draft or money order payable to the order
of the Rights Agent, of a sum equal to the applicable Exercise Price multiplied by the
number of Rights being exercised and a sum sufficient to cover any transfer or charge
which may be payable in respect of any transfer involved in the transfer or delivery
of Rights Certificates or the issuance or delivery of certificates for the relevant
Common Shares in a name other than that of the holder of the Rights being exercised.
The Rights Agent may retain any cash balance held in connection with this Agreement
and may, but need not, hold same in its deposit department or the deposit department
of one of its Affiliates; but the Rights Agent and its Affiliates shall not be liable
to account for any profit to the Company or any other person or entity other than at a
rate, if any, established from time to time by the Rights Agent or one of its
Affiliates.
 (f)
    
    Upon receipt of the Rights Certificate which is accompanied by a completed Election to
Exercise (provided that such Right is not null and void pursuant to subsection 4.1(b)) and
payment as set forth in clause 3.1(e)(iii), the Rights Agent
  - 22 -




---



##### 



(unless otherwise instructed in writing by the Company in the event that the Company
is of the opinion that the Rights cannot be exercised in accordance with this
Agreement) will thereupon promptly:
 (i)
    
    requisition from the transfer agent for the Common Shares certificates
representing the number of such Common Shares to be purchased (the Company hereby
irrevocably authorizing its transfer agents to comply with all such requisitions);(ii)
    
    when appropriate, requisition from the Company the amount of cash to be paid in
lieu of issuing fractional Common Shares;(iii)
    
    after receipt of such Common Share certificate referred to in clause 3.1(f)(i),
deliver the same to or to the order of the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such holder;(iv)
    
    when appropriate, after receipt, deliver such cash referred to in clause
3.1(f)(ii) to or to the order of the registered holder of the Rights Certificate; and(v)
    
    tender to the Company all payments received on exercise of the Rights.
 (g)
    
    In case the holder of any Rights shall exercise less than all the Rights evidenced by
such holders Rights Certificate, a new Rights Certificate evidencing the Rights remaining
unexercised will be issued by the Rights Agent to such holder or to such holders duly
authorized assigns.(h)
    
    The Company covenants and agrees that it will:
 (i)
    
    take all such reasonable action as may be necessary and within its power to ensure
that all Common Shares delivered upon exercise of Rights shall, at the time of
delivery of the certificates representing such Common Shares (subject to payment of
the Exercise Price), be duly and validly authorized, issued and delivered as fully
paid and non-assessable;(ii)
    
    take all such actions as may be necessary and within its power to comply with any
applicable requirements of the Companies Act, the Securities Act (Ontario), the
Securities Act (Québec) and the securities act or comparable legislation of each of
the other provinces of Canada, the 1933 Securities Act and the 1934 Exchange Act (if
applicable) and any other applicable law, rule or regulation, in connection with the
issuance and delivery of the Rights Certificates and the issuance of any Common Shares
upon exercise of Rights;(iii)
    
    use reasonable efforts to cause all Common Shares issued upon exercise of Rights
to be listed on the principal exchanges on which the Common Shares were traded
immediately prior to the Stock Acquisition Date;
  - 23 -




---



##### 



(iv)
    
    cause to be reserved and kept available out of its authorized and unissued
Common Shares the number of Common Shares that, as provided in this Agreement, will
from time to time be sufficient to permit the exercise in full of all outstanding
Rights; and(v)
    
    pay when due and payable any and all federal and provincial transfer taxes (for
greater certainty not including any income taxes of the holder or exercising holder
or any liability of the Company to withhold tax) which may be payable in respect of
the original issuance or delivery of the Rights Certificates, provided that the
Company shall not be required to pay any transfer tax or charge which may be payable
in respect of any transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates for Common Shares in a name
other than that of the holder of the Rights being transferred or exercised.
 3.2
    
    Adjustments to Exercise Price, Number of Rights
  (a)
    
    In the event the Company shall at any time after the Record Time and prior to the
Expiration Time:
 (i)
    
    declare or pay a dividend on the Common Shares payable in Common Shares (or
other securities exchangeable for or convertible into or giving a right to acquire
Common Shares or other capital stock of the Company) other than pursuant to any
dividend reinvestment program;(ii)
    
    subdivide or change the outstanding Common Shares of any class into a greater
number of Common Shares; or(iii)
    
    combine or change the outstanding Common Shares of any class into a smaller
number of Common Shares; or(iv)
    
    issue any new Common Shares (or other securities exchangeable for or
convertible into or giving a right to acquire Common Shares) in respect of, in lieu
of or in exchange for existing Common Shares, in a reclassification, amalgamation,
merger, statutory arrangement or consolidation,
 the Exercise Price and the number of Rights outstanding, or, if the payment or
effective date therefor shall occur after the Separation Time, the securities
purchasable upon exercise of Rights shall be adjusted in the manner set forth below.If the Exercise Price and the number of Rights outstanding are to be adjusted:
  - 24 -




---



##### 



(i)
    
    the Exercise Price in effect after such adjustment will be equal to the Exercise
Price in effect immediately prior to such adjustment divided by the number of Common
Shares (or other capital stock) (the Expansion Factor) that a holder of one Common
Share immediately prior to such dividend, subdivision, change, consolidation or
issuance would hold thereafter as a result thereof (assuming the exercise of all such
exchange or conversion rights, if any); and(ii)
    
    each Right held prior to such adjustment will become that number of Rights equal
to the Expansion Factor,
 and the adjusted number of Rights will be deemed to be distributed among the Common
Shares with respect to which the original Rights were associated (if they remain
outstanding) and the Common Shares issued in respect of such dividend, subdivision,
change, consolidation or issuance, so that each such Common Share (or other capital
stock) will have exactly one Right associated with it.If the securities purchasable upon exercise of Rights are to be adjusted, the
securities purchasable upon exercise of each Right after such adjustment will be the
securities that a holder of the securities purchasable upon exercise of one Right
immediately prior to such dividend, subdivision, change, consolidation or issuance
would hold immediately thereafter as a result thereof. To the extent that such rights
of exchange, conversion or acquisition are not exercised prior to the expiration
thereof, the Exercise Price shall be readjusted to the Exercise Price which would then
be in effect based on the number of Common Shares (or securities convertible into or
exchangeable for Common Shares) actually issued upon the exercise of such rights.If an event occurs which would require an adjustment under both this section 3.2 and
section 4.1, the adjustment provided for in this section 3.2 shall be in addition to,
and shall be made prior to, any adjustment required under section 4.1.If the Company shall at any time after the Record Time and prior to the Separation
Time issue any Common Shares otherwise than in a transaction referred to in this
subsection 3.2(a), each such Common Share so issued shall automatically have one new
Right associated with it, which Right shall be evidenced by the certificate
representing such Common Share.(b)
    
    In case the Company shall at any time after the Record Time and prior to the Separation
Time fix a record date for the issuance of rights, options or warrants to all holders of
Common Shares entitling them to subscribe for or purchase (for a period expiring within 45
calendar days after such record date) Common Shares (or shares having the same rights,
privileges and preferences as Common Shares (equivalent Common Shares)) or securities
convertible into Common Shares or equivalent Common Shares at a price per Common Share or per
equivalent Common Share (or having a conversion price per share, if a security convertible
into Common Shares or equivalent Common Shares) less than 90% of the Market
  - 25 -




---



##### 



Price per Common Share on such record date, the Exercise Price in respect of the
Rights to be in effect after such record date shall be determined by multiplying the
Exercise Price in respect of the Rights in effect immediately prior to such record
date by a fraction: (i) the numerator of which shall be the number of Common Shares
outstanding on such record date, plus the number of Common Shares that the aggregate
offering price of the total number of Common Shares and/or equivalent Common Shares so
to be offered (and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such Market Price per Common Share; and
(ii) the denominator of which shall be the number of Common Shares outstanding on such
record date, plus the number of additional Common Shares and/or equivalent Common
Shares to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case such subscription
price may be paid by delivery of consideration, part or all of which may be in a form
other than cash, the value of such consideration shall be as determined in good faith
by the Board of Directors, whose determination shall be described in a statement filed
with the Rights Agent and shall be binding on the Rights Agent and the holders of the
Rights. 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 Exercise
Price in respect of the Rights shall be readjusted to be the Exercise Price which
would then be in effect if such record date had not been fixed. To the extent that
such rights of conversion, exchange or purchase are not exercised prior to the
expiration thereof, the Exercise Price shall be readjusted to the Exercise Price which
would then be in effect based on the number of Common Shares (or securities
convertible into or exchangeable or exercisable for Common Shares) actually issued
upon the exercise of such rights.(c)
    
    For purposes of this Agreement, the granting of the right to purchase Common Shares
(whether from treasury or otherwise) pursuant to a dividend or interest reinvestment plan or
any Common Share purchase plan providing for the reinvestment of dividends or interest
payable on the securities of the Company or the investment of periodic optional payments or
any employee benefit, stock option or similar plans shall be deemed not to constitute an
issue of rights, options or warrants by the Company; provided, however, that in all such
cases the right to purchase Common Shares is at a price per share of not less than 90% of the
current market price per share (determined as provided in such plans) of Common Shares.(d)
    
    In case the Company shall at any time after the Record Time and prior to the Separation
Time fix a record date for a distribution to all holders of Common Shares (including any such
distribution made in connection with a merger in which the Company is the continuing Company)
of evidences of indebtedness or assets, including cash (other than a dividend paid in the
ordinary course or a dividend paid in Common Shares, but including any dividend payable in
securities other than Common Shares), or subscription rights or warrants entitling them to
subscribe for or purchase Common Shares (excluding those referred to in subsection 3.2(b)) at
a price per Common Share that is less than 90% of the
  - 26 -




---



##### 



Market Price per Common Share on such record date, the Exercise Price in respect of
the Rights to be in effect after such record date shall be determined by multiplying
the Exercise Price in respect of the Rights in effect immediately prior to such record
date by a fraction: (i) the numerator of which shall be the Market Price per Common
Share 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 and shall be binding on the Rights Agent and the holders of the
Rights) of the portion of the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable to a Common Share;
and (ii) the denominator of which shall be such Market Price per Common Share. 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 Exercise Price in respect of the
Rights shall be adjusted to be the Exercise Price in respect of the Rights which would
have been in effect if such record date had not been fixed.(e)
    
    Notwithstanding anything herein to the contrary, no adjustment in an Exercise Price shall
be required unless such adjustment would require an increase or decrease of at least 1% in
such Exercise Price; provided, however, that any adjustments which by reason of this
subsection 3.2(e) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this section 3.2 shall be made to the
nearest cent or to the nearest ten-thousandth of a Common Share or other share, as the case
may be.
Notwithstanding the first sentence of this subsection 3.2(e), any adjustment required
by this section 3.2 shall be made no later than the earlier of (i) three years from
the date of the transaction which mandates such adjustment and (ii) the Expiration
Time.(f)
    
    Subject to the prior consent of the holders of Common Shares or Rights obtained in
accordance with the provisions of Article 6, as applicable, in the event the Company shall at
any time after the Record Time and prior to the Separation Time issue any shares of capital
stock (other than Common Shares), or rights or warrants to subscribe for or purchase any such
capital stock, or securities convertible into or exchangeable for any such capital stock, in
a transaction referred to in clauses 3.2(a)(i) or 3.2(a)(iv), if the Board of Directors
acting in good faith determines that the adjustments contemplated by subsections 3.2(a),
3.2(b) and 3.2(c) above in connection with such transaction will not appropriately protect
the interests of the holders of Rights, the Company may determine what other adjustments to
the Exercise Price, number of Rights or securities purchasable upon exercise of Rights would
be appropriate and, notwithstanding subsections 3.2(a), 3.2(b) and 3.2(c) above, such
adjustments (rather than the adjustment contemplated by subsections 3.2(a), 3.2(b) and
3.2(c)), shall be made.
The Company and the Rights Agent at the written direction of the Company shall amend
this Agreement as appropriate to provide for such adjustments.(g)
    
    If, as a result of an adjustment made pursuant to section 4.1, the holder of any Right
thereafter exercised shall become entitled to receive any Shares other than
  - 27 -




---



##### 



Common Shares, thereafter the number of such other Shares so receivable upon exercise
of any Right and the applicable Exercise Price thereof shall be subject to adjustment
from time to time in a manner and on terms as nearly equivalent as is practicable to
the provisions with respect to the Common Shares contained in this section 3.2, and
the provisions of this Agreement with respect to the Common Shares shall apply on like
terms to any such other Shares.(h)
    
    All Rights originally issued by the Company subsequent to any adjustment made to an
Exercise Price hereunder shall evidence the right to purchase, at the adjusted Exercise
Price, that number of Common Shares purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.(i)
    
    Unless the Company shall have exercised its election as provided in subsection 3.2(j),
upon each adjustment of an Exercise Price as a result of the calculations made in subsections
3.2(b) and 3.2(d), each Right outstanding immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number
of Common Shares (calculated to the nearest one ten-thousandth) determined by:
 (i)
    
    multiplying:
 (a)
    
    the number of such Common Shares which would have been issuable upon the
exercise of a Right immediately prior to this adjustment; by(b)
    
    the relevant Exercise Price in effect immediately prior to such adjustment
of the Relevant Exercise Price; and
 (ii)
    
    dividing the product so obtained by the relevant Exercise Price in effect
immediately after such adjustment of the relevant Exercise Price.
 (j)
    
    The Company may elect on or after the date of any adjustment of an Exercise Price to
adjust the number of Rights, in lieu of any adjustment in the number of Common Shares
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 Common Shares for
which such a Right was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by dividing the relevant Exercise
Price in effect immediately prior to adjustment of the relevant Exercise Price by the
relevant Exercise Price in effect immediately after adjustment of the relevant Exercise
Price. The Company shall make a public announcement of its election to adjust the number of
Rights, indicating the record date for the adjustment, and, if known at the time, the amount
of the adjustment to be made.
This record date may be the date on which the relevant Exercise Price is adjusted or
any day thereafter, but, if the Rights Certificates have been issued, shall be at
  - 28 -




---



##### 



least 10 days later than the date of the public announcement. If Rights Certificates
have been issued, upon each adjustment of the number of Rights pursuant to this
subsection 3.2(j), the Company shall, as promptly as is practicable, cause to be
distributed to holders of record of Rights Certificates on such record date, Rights
Certificates evidencing, subject to section 6.4, the additional Rights to which such
holders shall be entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the Company, new Rights
Certificates evidencing all the Rights to which such holders shall be entitled after
such adjustment. Rights Certificates to be so distributed shall be issued, executed
and countersigned in the manner provided for herein and may bear, at the option of the
Company, the relevant adjusted Exercise Price and shall be registered in the names of
holders of record of Rights Certificates on the record date specified in the public
announcement.(k)
    
    Irrespective of any adjustment or change in an Exercise Price or the number of Common
Shares issuable upon the exercise of the Rights, the Rights Certificates theretofore and
thereafter issued may continue to express the relevant Exercise Price per Common Share and
the number of Common Shares which were expressed in the initial Rights Certificates issued
hereunder.(l)
    
    In any case in which this section 3.2 shall require that an adjustment in an Exercise
Price be made effective as of a record date for a specified event, the Company may elect to
defer, until the occurrence of such event, the issuance to the holder of any Right exercised
after such record date of the number of Common Shares and other securities of the Company, if
any, issuable upon such exercise over and above the number of Common Shares and other
securities of the Company, if any, issuable upon such exercise on the basis of the relevant
Exercise 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 Common Shares (fractional or otherwise) or other securities
upon the occurrence of the event requiring such adjustment.(m)
    
    Notwithstanding anything in this section 3.2 to the contrary, the Company shall be
entitled to make such reductions in each Exercise Price in addition to those adjustments
expressly required by this section 3.2, as and to the extent that in its good faith judgment
the Board of Directors shall determine to be advisable in order that any: (i) consolidation
or subdivision of Common Shares; (ii) issuance wholly for cash of any Common Share or
securities that by their terms are convertible into or exchangeable for Common Shares; (iii)
stock dividends; or (iv) issuance of rights, options or warrants referred to in this section
3.2 hereafter made by the Company to holders of its Common Shares shall not be taxable to
such shareholders.
  - 29 -




---



##### 



(n)
    
    The Company covenants and agrees that, after the Separation Time, it will not, except as
permitted by section 6.1 or 6.5, take (or permit any Subsidiary of the Company to take) any
action if at the time such action is taken it is reasonably foreseeable that such action
will diminish substantially or otherwise eliminate the benefits intended to be afforded by
the Rights.(o)
    
    Whenever an adjustment to the Exercise Price or a change in the securities purchasable
upon exercise of the Rights is made at any time after the Separation Time pursuant to this
Section 3.2, the Company shall promptly:
 (i)
    
    File with the Rights Agent and with the transfer agent for the Common Shares a
certificate specifying the particulars of such adjustment or change; and(ii)
    
    Cause notice of the particulars of such adjustment or change to be given to the
holders of the Rights; provided that failure to file such certificate or cause such
notice to be given as aforesaid, or any defect therein, shall not affect the
validity of any such adjustment or change.
 3.3
    
    Date on Which Exercise is Effective
  ARTICLE 4
ADJUSTMENTS TO THE RIGHTS
IN THE EVENT OF CERTAIN TRANSACTIONS
 4.1
    
    Flip-in Event
 (a)
    
    Subject to subsection 4.1(b) and subsections 6.1(f), 6.1(g) and 6.1(h), in the event
that prior to the Expiration Time a Flip-in Event shall occur, each Right shall constitute,
effective on and after the later of its date of issue and the Close of Business on the tenth
Trading Day following the Stock Acquisition Date, the right to purchase from the Company,
upon payment of the relevant Exercise Price and otherwise exercising such Right in
accordance with the terms hereof, that number of Common Shares having an aggregate Market
Price on the date of consummation or occurrence of such Flip-in Event equal to twice the
relevant Exercise Price for an amount in cash equal to the relevant Exercise Price (such
  - 30 -




---



##### 



right to be appropriately adjusted in a manner analogous to the applicable adjustments
provided for in section 3.2 upon each occurrence after the Stock Acquisition Date of
any event analogous to any of the events described in section 3.2).(b)
    
    Notwithstanding anything in this Agreement to the contrary, upon the occurrence of any
Flip-in Event, any Rights that are or were Beneficially Owned on or after the earlier of the
Separation Time and the Stock Acquisition Date by: (i) an Acquiring Person (or any Affiliate
or Associate of an Acquiring Person or any Person acting jointly or in concert with an
Acquiring Person or any Affiliate or Associate of an Acquiring Person); or (ii) a transferee
or other successor in title, directly or indirectly, (a Transferee) of Rights held by an
Acquiring Person (or any Affiliate or Associate of an Acquiring Person or any Person acting
jointly or in concert with an Acquiring Person or any Affiliate or Associate of an Acquiring
Person) who becomes a Transferee concurrently with or subsequent to the Acquiring Person
becoming an Acquiring Person in a transfer that the Board of Directors has determined is part
of a plan, arrangement or scheme of an Acquiring Person (or any Affiliate or Associate of an
Acquiring Person or any Person acting jointly or in concert with an Acquiring Person or any
Affiliate or Associate of an Acquiring Person), that has the purpose of avoiding the effect
of this subsection 4.1(b) shall become null and void without any further action, and any
holder of such Rights (including any Transferee) shall not have any right whatsoever to
exercise such Rights under any provision of this Agreement and shall not have thereafter any
other rights whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The holder of any
Rights represented by a Rights Certificate which is submitted to the Rights Agent upon
exercise or for registration of transfer or exchange which does not contain the
necessary certifications set forth in the Rights Certificate establishing that such
Rights are not void under this subsection 4.1(b) shall be deemed to be an Acquiring
Person for the purposes of this subsection 4.1(b) and such Rights shall become null
and void.(c)
    
    In the event that there shall not be sufficient Common Shares authorized for issuance to
permit the exercise in full of the Rights in accordance with this section 4.1 the Company
shall take all such action as may be necessary to authorize additional Common Shares for
issuance upon the exercise of the Rights.(d)
    
    From and after the Separation Time, the Company shall do all such acts and things as
shall be necessary and within its power to ensure compliance with the provisions of this
section 4.1 including, without limitation, all such acts and things as may be required to
satisfy the requirements of the Companies Act, the Securities Act (Ontario), the Securities
Act (Québec) or comparable legislation of each of the provinces of Canada, and of the United
States and each of the states thereof, if necessary, in respect of the issue of Common Shares
upon the exercise of Rights in accordance with this Agreement.
  - 31 -




---



##### 



(e)
    
    Any Rights Certificate that represents Rights Beneficially Owned by a
Person described in subsection 4.1(b) or transferred to any nominee of any such Person, and
any Rights Certificate issued upon transfer, exchange, replacement or adjustment of any
other Rights Certificate referred to in this sentence, shall contain the following legend:
 The Rights represented by this Certificate were issued to a Person
who was an Acquiring Person or an Affiliate or an Associate of an
Acquiring Person (as such terms are defined in the Rights Agreement)
or a Person acting jointly or in concert with any of them. This
Rights Certificate and the Rights represented hereby shall become void
in the circumstances specified in subsection 4.1(b) of the Rights
Agreement.
 provided that the Rights Agent shall not be under any responsibility to ascertain
the existence of facts that would require the imposition of such legend but shall be
required to impose such legend only if instructed to do so by the Company in writing
or if a holder fails to certify upon transfer or exchange in the space provided on
the Rights Certificate that such holder is not a Person described in such legend.
 ARTICLE
5 THE RIGHTS AGENT
 5.1
    
    General
 (a)
    
    The Company hereby appoints the Rights Agent to act as agent for the Company
and the holders of Rights in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company may from time to time appoint
one or more Co-Rights Agents as it may deem necessary or desirable subject to the
approval of the Rights Agent. In the event the Company appoints one or more Co-Rights
Agents, the respective duties of the Rights Agents and Co-Rights Agents shall be as the
Company may determine with the approval of the Rights Agent. The Company agrees to pay
to the Rights Agent reasonable compensation for all services rendered by them from time
to time, its reasonable expenses and counsel fees and other disbursements incurred in
the administration and execution of this Agreement and the exercise and performance of
its duties hereunder. The Company also agrees to indemnify the Rights Agent, its
offices, directors and employees for, and to hold them harmless against, any loss,
liability or expense, incurred without negligence, bad faith or wilful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement, including the
costs and expenses of defending against any claim of liability, which right to
indemnification will survive the termination of this Agreement or the resignation or
removal of the Rights Agent.
  - 32 -




---



##### 



(b)
    
    The Rights Agent shall be protected and shall incur no liability for or in
respect of any action taken, suffered or omitted by it (without negligence, bad
faith or wilful misconduct on the part of the Rights Agent) in connection with its
administration of this Agreement in reliance upon any certificate for Common Shares,
Rights Certificate, certificate for Shares of the Company, instrument of assignment
or transfer, power of attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or acknowledged,
by the proper Person or Persons.(c)
    
    The Company shall inform the Rights Agent in a reasonably timely manner of
events which may materially affect the administration of this Agreement by the Rights
Agent and shall, at any time, upon request by the Rights Agent provide to the Rights
Agent an incumbency certificate certifying the then current officers of the Company.
 5.2
    
    Merger or Amalgamation or Change of Name of Rights Agent
 (a)
    
    Any Company into which the Rights Agent or any successor Rights Agent may be
merged or amalgamated or with which it may be consolidated, or any Company resulting
from any merger, amalgamation or consolidation to which the Rights Agent or any
successor Rights Agent is a party, or any Company succeeding to the shareholder or
stockholder services business of the Rights Agent or any successor Rights Agent, will
be the successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such Company would be eligible for appointment as a successor Rights
Agent under the provisions of section 5.4. In case at the time such successor Rights
Agent succeeds to the agency created by this Agreement any of the Rights Certificates
have been countersigned but not delivered, any such successor Rights Agent may adopt
the countersignature of the predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights Certificates
have not been countersigned, any successor Rights Agent may countersign such Rights
Certificates either in the name of the predecessor Rights Agent or in the name of the
successor Rights Agent; and in all such cases such Rights Certificates will have the
full force provided in the Rights Certificates and in this Agreement.(b)
    
    In case at any time the name of the Rights Agent is changed and at such time
any of the Rights Certificates shall have been countersigned but not delivered, the
Rights Agent may adopt the countersignature under its prior name and deliver Rights
Certificates so countersigned; and in case at that time any of the Rights Certificates
shall not have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all such cases
such Rights Certificates shall have the full force provided in the Rights Certificates
and in this Agreement.
  - 33 -




---



##### 



5.3
    
    Duties of Rights Agent
  (a)
    
    the Rights Agent may retain and consult with legal counsel (who may be legal
counsel for the Company) and the opinion of such legal counsel will be full and
complete authorization and protection to the Rights Agent as to any action taken or
omitted by it in good faith and in accordance with such opinion; the Rights Agent may
also, with the approval of the Company (where such approval may reasonable be obtained
and such approval not be unreasonably withheld), consult with such other experts as the
Rights Agent shall consider necessary or appropriate to properly carry out the duties
and obligations imposed under this Agreement (at the Companys expense, which expenses
must be reasonable in the circumstances) and the Rights Agent shall be entitled to act
and rely in good faith on the advice of any such expert;(b)
    
    whenever in the performance of its duties under this Agreement the Rights Agent
deems it necessary or desirable that any fact or matter be proved or established by the
Company prior to taking or refraining from taking any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein specifically prescribed) may
be deemed to be conclusively proved and established by a certificate signed by a Person
believed by the Rights Agent to be the Chairman of the Board, the President or any
Vice-President and by the Treasurer or any Assistant-Treasurer or the Secretary or any
Assistant-Secretary of the Company and delivered to the Rights Agent and such
certificate shall be full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement in reliance upon
such certificate;(c)
    
    the Rights Agent will be liable hereunder only for its own negligence, bad
faith or wilful misconduct;(d)
    
    the Rights Agent will not be liable for or by reason of any of the statements
of fact or recitals contained in this Agreement or in the certificates for Shares or
the Rights Certificates (except its countersignature thereof) or be required to verify
the same, but all such statements and recitals are and will be deemed to have been made
by the Company only;(e)
    
    the Rights Agent will not be under any responsibility in respect of the
validity of this Agreement or the execution and delivery hereof (except the due
authorization, execution and delivery hereof by the Rights Agent) or in respect of the
validity or execution of any Share certificate or Rights Certificate (except its
countersignature thereof); nor will it be responsible for any breach by the Company of
any covenant or condition contained in this Agreement or in any Rights Certificate, nor
will it be responsible for any change in the exercisability of the Rights (including
the Rights becoming void pursuant to subsection 4.1(b)) or
  - 34 -




---



##### 



any adjustment required under the provisions of section 3.2 or responsible for the
manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with respect to
the exercise of Rights after receipt of the certificate contemplated by section
3.2 describing any such adjustment); nor will it by any act hereunder be deemed to
make any representation or warranty as to the authorization of any Common Shares
to be issued pursuant to this Agreement or any Rights or as to whether any Shares
will, when issued, be duly and validly authorized, executed, issued and delivered
as fully paid and non-assessable;(f)
    
    the Company agrees that it will perform, execute, acknowledge and deliver
or cause to be performed, executed, acknowledged and delivered all such further
and other acts, instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights Agent of the
provisions of this Agreement;(g)
    
    the Rights Agent is hereby authorized and directed to accept instructions
with respect to the performance of its duties hereunder from any Person believed
by the Rights Agent to be the Chairman of the Board, the President and Chief
Executive Officer, 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
Persons for advice or instructions in connection with its duties, and it shall
not be liable for any action taken or suffered by it in good faith in accordance
with instructions of any such Person; it is understood that instructions to the
Rights Agent will, except where circumstances make it impracticable or the Rights
Agent otherwise agrees, be given in writing and, where not in writing, such
instructions will be confirmed in writing as soon as reasonably possible after
the giving of such instructions.(h)
    
    the Rights Agent and any shareholder or stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in Shares, 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 Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other legal entity;(i)
    
    the Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents, and the Rights Agent will not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection
and continued employment thereof; and(j)
    
    the Rights Agent may retain any cash balance held in connection with this
Agreement and may, but need not, hold same in its deposit department or the
  - 35 -




---



##### 



deposit department of one of its Affiliates; but the Rights Agent and its Affiliates
shall not be liable to account for any profit to the Company or any other person or
entity other than at a rate, if any, established from time to time by the Rights
Agent or one of its Affiliates.
 5.4
    
    Change of Rights Agent
  ARTICLE 6
MISCELLANEOUS
 6.1
    
    Redemption and Waiver
 (a)
    
    Subject to the prior consent of the holders of Common Shares or Rights obtained in
accordance with subsection 6.5(b) or 6.5(c), as applicable, and prior to the occurrence of a
Flip-in Event as to which the application of section 4.1 has not been waived pursuant to
this section 6.1, the Board of Directors may, acting in good faith, elect to redeem all but
not less than all of the then outstanding Rights
  - 36 -




---



##### 



at a redemption price of $0.0001 per Right, appropriately adjusted in a manner
analogous to the applicable adjustment provided for in section 3.2, if an event of the
type analogous to any of the events described in section 3.2 shall have occurred (such
redemption price being herein referred to as the Redemption Price).(b)
    
    If a Person acquires pursuant to a Permitted Bid, a Competing Permitted Bid or an Exempt
Acquisition outstanding Common Shares other than Common Shares Beneficially Owned by such
Person at the date of the Permitted Bid, the Competing Permitted Bid or such Exempt
Acquisition, the Board of Directors of the Company shall, immediately upon such acquisition
and without further formality be deemed to have elected to redeem the Rights at the
Redemption Price.(c)
    
    Where a Take-over Bid that is not a Permitted Bid or a Competing Permitted Bid is
withdrawn or otherwise terminated after the Separation Time has occurred and prior to the
occurrence of a Flip-in Event, the Board of Directors may elect to redeem all the outstanding
Rights at the Redemption Price.(d)
    
    Within 10 Business Days after the Board of Directors electing or being deemed to have
elected to redeem the Rights or, if subsection 6.1(a) is applicable, within 10 Business Days
after the holders of Common Shares or the holders of Rights have approved a redemption of
Rights in accordance with subsection 6.5(b) or 6.5(c), as applicable, the Company shall give
notice of such redemption to the holders of the then outstanding Rights by mailing such
notice to each such holder at his last address as it appears on the Rights Register or, prior
to the Separation Time, on the register of Common Shares maintained by the Companys transfer
agent. Each such notice of redemption shall state the method by which the payment of the
Redemption Price shall be made. The Company may not redeem, acquire or purchase for any value
any Rights at any time in any manner other than that specifically set forth in this section
6.1 or in connection with the purchase of Common Shares prior to the Separation Time.(e)
    
    If the Board of Directors elects to or is deemed to have elected to redeem the Rights
and, in circumstances where subsection 6.1(a) is applicable, such redemption is approved by
the holders of Common Shares or the holders of Rights in accordance with subsection 6.5(b) or
6.5(c), as applicable, (i) the right to exercise the Rights will thereupon without further
action and without notice terminate and the only right thereafter of the holder of a Right
shall be to receive the Redemption Price, and (ii) no further Rights shall thereafter be
issued.(f)
    
    Upon written notice to the Rights Agent, the Board of Directors may, in respect of any
Flip-in Event waive the application of section 4.1 in respect of that Flip-in Event, provided
that both of the following conditions are satisfied: (i) the Board of Directors had
determined, within 10 Business Days following a Stock Acquisition Date, that the Person
became an Acquiring Person by inadvertence and without any intent to become, or knowledge
that it would become, an
  - 37 -




---



##### 



Acquiring Person; and (ii) such Acquiring Person, within 14 days after such
determination or such earlier or later period as the Board of Directors may
determine (the Disposition Date) has reduced its Beneficial Ownership of Common
Shares such that at the time of waiver pursuant to this subsection 6.1(f) it is no
longer an Acquiring Person; if the Acquiring Person remains an Acquiring Person at
the close of business on the Disposition Date, the Disposition Date shall be deemed
to be the date of occurrence of a further Stock Acquisition Date and section 4.1
shall apply thereto. In the event of any such waiver pursuant to this subsection
6.1(g), for the purposes of this Agreement, such Flip-in Event shall be deemed not
to have occurred and the Separation Time shall be deemed not to have occurred as a
result of such Person having inadvertently become an Acquiring Person.(g)
    
    The Board of Directors may, until a Flip-in Event shall have occurred, upon written
notice delivered to the Rights Agent, determine to waive the application of section 4.1 to a
Flip-in Event but only if such Flip-in Event occurs by reason of a Take-over Bid made by way
of a take-over bid circular to all holders of record of the Common Shares of the Company
which are subject to the Take-over Bid (which, for greater certainty, does not include the
circumstances described in subsection 6.1(f)); provided however, that if the Board of
Directors waives the application of section 4.1 to a particular Flip-in Event pursuant to
this subsection 6.1(g), the Board of Directors shall be deemed to have waived the
application of section 4.1 to any other Flip-in Event occurring by reason of any Take-over
Bid which is made by means of a take-over bid circular to all holders of record of Common
Shares prior to the expiry of any Take-over Bid in respect of which a waiver is, or is
deemed to have been, granted under this subsection 6.1(g).(h)
    
    The Board of Directors may, with the prior consent of the holders of Common Shares given
in accordance with subsection 6.5(b), determine, at any time prior to the occurrence of a
Flip-in Event as to which the application of section 4.1 has not been waived pursuant to
this section 6.1, if such Flip-in Event would occur by reason of an acquisition of Common
Shares otherwise than pursuant to a Take-over Bid made by means of a Take-over Bid circular
to all holders of record of Common Shares and otherwise than in the circumstances set forth
in subsection 6.1(f), to waive the application of section 4.1 to such Flip-in Event. In the
event that the Board of Directors proposes such a waiver, the Board of Directors shall
extend the Separation Time to a date subsequent to and not more than 10 Business Days
following the meeting of shareholders called to approve such waiver.
 6.2
    
    Expiration
   - 38 -




---



##### 



6.3
    
    Issuance of New Rights Certificate
  6.4
    
    Fractional Rights and Fractional Shares
 (a)
    
    The Company shall not be required to issue fractions of Rights or to distribute Rights
Certificates which evidence fractional Rights. In lieu of such fractional Rights, there
shall be paid to the registered holders of the Rights Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to the fraction of
the Market Price of a whole Right that the fraction of a Right which would otherwise be
issuable is of one whole Right at the date of such issuance.
 (b)
    
    The Company shall not be required to issue fractions of Common Shares upon exercise of
the Rights or to distribute certificates which evidence fractional Common Shares. In lieu
of issuing fractional Common Shares, the Company shall pay to the registered holders of
Rights Certificates, at the time such Rights are exercised as herein provided, an amount in
cash equal to the fraction of the Market Price of a whole Common Shares that the fraction of
a Common Share which would otherwise be issuable upon the exercise of such right is of one
whole Common Share at the date of such exercise.
 (c)
    
    The Rights Agent shall have no obligation to make any payments in lieu of issuing
fractions of Rights or Common Shares pursuant to paragraph (a) or (b), respectively, unless
and until the Company shall have provided to the Rights Agent the amount of cash to be paid
in lieu of issuing such fractional Rights or Common Shares.
 6.5
    
    Supplements and Amendments
 (a)
    
    The Company may make, without the approval of the holders of Rights or Common Shares,
any amendments to this Agreement (i) to correct any clerical or typographical error or (ii)
which are required to maintain the validity and effectiveness of the Agreement as a result
of any change in any applicable laws, rules or regulatory requirements. The Company may,
prior to the due date of the shareholders meeting referred to in section 6.15, supplement,
amend, vary, rescind or delete any of the provisions of this Agreement without the approval
of any holders of Rights or Common Shares (whether or not such action would materially
adversely affect the interest of the holders of Rights generally) where the Board of
Directors acting in good faith deems such action necessary or desirable. Notwithstanding
anything in this section 6.5 to the contrary, no
  - 39 -




---



##### 



amendment shall be made to the provisions of Article 5 except with the written
concurrence of the Rights Agent to such supplement or amendment.(b)
    
    Subject to subsection 6.5(a), the Company may, with the prior consent of the holders of
Common Shares obtained as set forth below, at any time before the Separation Time, amend,
vary or rescind any of the provisions of this Agreement and the Rights (whether or not such
action would materially adversely affect the interests of the holders of Rights generally).
Such consent shall be deemed to have been given if provided by the holders of Common Shares
at a special meeting called and held in compliance with applicable laws, rules and regulatory
requirements and the requirements in the articles and by-laws of the Company. Subject to
compliance with any requirements imposed by the foregoing, consent shall be given if the
proposed amendment, variation or rescission is approved by the affirmative vote of a majority
of the votes cast by Independent Shareholders represented in person or by proxy at the
special meeting.(c)
    
    Subject to subsection 6.5(a), the Company may, with the prior consent of the holders of
Rights obtained as set forth below, at any time after the Separation Time and before the
Expiration Time, amend, vary or rescind any of the provisions of this Agreement and the
Rights (whether or not such action would materially adversely affect the interests of the
holders of Rights generally). Such consent shall be deemed to have been given if provided by
the holders of Rights at a special meeting of holders of Rights called and held in compliance
with applicable laws and regulatory requirements and, to the extent possible, with the
requirements in the articles and by-laws of the Company applicable to meetings of holders of
Common Shares, applied mutatis mutandis. Subject to compliance with any requirements imposed
by the foregoing, consent shall be given if the proposed amendment, variation or rescission
is approved by the affirmative vote of a majority of the votes cast by holders of Rights
(other than holders of Rights whose Rights have become null and void pursuant to subsection
4.1(b)), represented in person or by proxy at the special meeting.(d)
    
    Any amendments made by the Company to this Agreement pursuant to subsection 6.5(a) which
are required to maintain the validity and effectiveness of this Agreement as a result of any
change in any applicable laws, rules or regulatory requirements shall:
 (i)
    
    if made before the Separation Time, be submitted to the holders of Common Shares
of the Company at the next meeting of shareholders and the shareholders may, by the
majority referred to in subsection (b), confirm or reject such amendment; and(ii)
    
    if made after the Separation Time, be submitted to the holders of Rights at a
meeting to be called for on a date not later than immediately following the next
meeting of shareholders of the Company and the holders of Rights may, by resolution
passed by the majority referred to in subsection 6.5(c), confirm or reject such
amendment.
  - 40 -




---



##### 



Any such amendment shall be effective from the date of the resolution of the Board
of Directors adopting such amendment, until it is confirmed or rejected or until it
ceases to be effective (as described in the next sentence) and, where such amendment
is confirmed, it continues in effect in the form so confirmed. If such amendment is
rejected by the shareholders of the Company or the holders of Rights or is not
submitted to the shareholders of the Company or holders of Rights as required, then
such amendment shall cease to be effective from and after the termination of the
meeting at which it was rejected or to which it should have been but was not
submitted or from and after the date of the meeting of holders of Rights as the case
may be.(e)
    
    The Company shall give notice in writing to the Rights Agent of any supplement,
amendment, deletion, variation or rescission to this Agreement pursuant to Section 6.5
within five Business Days of the date of any such supplement, amendment, deletion, variation
or rescission, provided that failure to give such notice, of any defect therein, shall not
affect the validity of any such supplement, amendment, deletion, variation or rescission.
 6.6
    
    Rights of Action
  6.7
    
    Notice of Proposed Actions
  (a)
    
    there shall occur an adjustment to the Rights pursuant to section 4.1 as a result of the
occurrence of a Flip-in Event; or
 (b)
    
    the Company proposes to effect the liquidation, dissolution or winding-up of
the Company or the sale of all or substantially all of the Companys assets;
   - 41 -




---



##### 



6.8
    
    Notices
  Theratechnologies Inc.
2310 Alfred-Nobel Boulevard
Montreal, Québec
H4S 2B4Attention: General Counsel and Corporate Secretary
Facsimile: 514 331 9691
  Computershare Trust Company of Canada
1500 University Street
Suite 700
Montreal, Québec
H3A 3S8Attention: Manager, Client Services
Facsimile: 514 982 7580
  6.9
    
    Costs of Enforcement
   - 42 -




---



##### 



6.10
    
    Successors
  6.11
    
    Benefits of this Agreement
  6.12
    
    Governing Law
  6.13
    
    Counterparts
  6.14
    
    Severability
  6.15
    
    Effective Date
 (a)
    
    Notwithstanding its amendment and restatement as at the date hereof, and subject to
subsection 6.15(b), this Agreement:
 (i)
    
    shall be effective and in full force and effect in accordance with its terms
from and after the Effective Date and shall replace and supersede the Original Plan
and shall constitute the entire agreement between the parties pertaining to the
subject matter hereof as of the Effective Date; and
 (ii)
    
    shall expire and be of no further force or effect from and after the Expiration
Time.
  - 43 -




---



##### 



(b)
    
    Notwithstanding subsection 6.15(a), if the Agreement is not approved by a resolution
passed by a majority of the votes cast by Independent Shareholders who vote in respect of
approval of this Agreement at the annual and special meeting of the holders of Common Shares
scheduled to be held on March 25, 2010, then the Plan and all outstanding Rights shall
terminate and be null and void and of no further force and effect from and after the
Effective Date.
 6.16
    
    Determinations and Actions by the Board of Directors
  6.17
    
    Time of the Essence
 Time shall be of the essence in this Agreement.
 6.18
    
    Regulatory Approvals
  6.19
    
    Language
   - 44 -




---



##### 



THERATECHNOLOGIES INC.By:
    (signed) Yves RosconiPresident and Chief Executive OfficerCOMPUTERSHARE TRUST 
COMPANY OF CANADABy:
    (signed) Martine GauthierProfessional, Client Services(signed) Julien LavallièreProfessional, Client Services  - 45 -




---



##### 



EXHIBIT A
 FORM OF RIGHTS CERTIFICATE
 Certificate No. ______
    
    ___Rights
 RIGHTS CERTIFICATE
 THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES (SPECIFIED IN SECTION 4.1(b) OF THE RIGHTS
AGREEMENT), RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR ITS AFFILIATES OR ASSOCIATES OR ANY
PERSON ACTING JOINTLY OR IN CONCERT WITH ANY OF THEM OR SUCH PERSONS ASSOCIATES OR AFFILIATES (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR TRANSFEREES OF ANY OF THE FOREGOING WILL BECOME
VOID WITHOUT FURTHER ACTION.
 Rights Agreement Company Rights Agent Share




---



##### 



THERATECHNOLOGIES INC.By:By:  COMPUTERSHARE TRUST COMPANY OF CANADABy:By:  - A-2 -




---



##### 



Shares
 NameAddressCity and ProvinceSocial Insurance, Social Security Number or other taxpayer identification number
  NameAddressCity and ProvinceSocial Insurance, Social Security Number or other taxpayer identification number
  SignatureSignature Guaranteed:
    
    (Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change whatsoever)
  - A-3 -




---



##### 



Note: Signature must be guaranteed by a major Canadian trust company, a Schedule 1 Canadian
chartered bank, or a member of a recognized Medallion Guarantee program.
   Signature
  - A-4 -




---



##### 



FORM OF ASSIGNMENT
 FOR VALUE RECEIVED
 hereby sells, assigns and transfers unto(Please print name and address of transferee)
   Signature Guaranteed:
    
    (Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change whatsoever)
 Note: Signature must be guaranteed by a major Canadian trust company, a Schedule 1 Canadian
chartered bank, or a member of a recognized Medallion Guarantee program..
   Signature
  - A-5 -




---



##### 



NOTICE
   - A-6 -