QuickLinks
 -- Click here to rapidly navigate through this document

 
 

Exhibit 4.1    
    


        Execution Copy  


GENZYME CORPORATION  


 and  


 American Stock Transfer & Trust Company,

Rights Agent  


 Fourth Amended and Restated Renewed Rights Agreement  


 Dated as of May 28, 2004  








   TABLE OF CONTENTS  



	 
	 	 
	 	Page

	Section 1.	 	Certain Definitions	 	2
	Section 2.	 	Appointment of Rights Agent	 	5
	Section 3.	 	Issue of Right Certificates	 	5
	Section 4.	 	Form of Right Certificates	 	6
	Section 5.	 	Countersignature and Registration	 	6
	Section 6.	 	Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates	 	7
	Section 7.	 	Exercise of Rights; Purchase Price; Expiration Date of Rights	 	8
	Section 8.	 	Cancellation and Destruction of Right Certificates	 	9
	Section 9.	 	Reservation and Availability of Preferred Shares	 	9
	Section 10.	 	Preferred Shares Record Date	 	10
	Section 11.	 	Adjustment in Rights; Exchange of Rights; Certain Covenants	 	10
	Section 12.	 	Certificate of Adjustment	 	16
	Section 13.	 	Consolidation, Merger or Sale or Transfer of Assets or Earning Power	 	17
	Section 14.	 	Fractional Rights and Fractional Shares	 	19
	Section 15.	 	Rights of Action	 	20
	Section 16.	 	Agreement of Right Holders	 	20
	Section 17.	 	Right Certificate Holder Not Deemed a Shareholder	 	20
	Section 18.	 	Concerning the Rights Agent	 	21
	Section 19.	 	Merger or Consolidation or Change of Name of Rights Agent	 	21
	Section 20.	 	Duties of Rights Agent	 	22
	Section 21.	 	Change of Rights Agent	 	23
	Section 22.	 	Issuance of New Right Certificates	 	24
	Section 23.	 	Redemption	 	24
	Section 24.	 	Notice of Certain Events	 	24
	Section 25.	 	Notices	 	25
	Section 26.	 	Supplements and Amendments	 	26
	Section 27.	 	Successors	 	26
	Section 28.	 	Determinations and Actions by the Board of Directors	 	26
	Section 29.	 	Benefits of this Agreement	 	27
	Section 30.	 	Severability	 	27
	Section 31.	 	Governing Law	 	27
	Section 32.	 	Counterparts	 	27
	Section 33.	 	Descriptive Headings	 	27
	EXHIBIT A—TERMS OF THE JUNIOR PARTICIPATING PREFERRED STOCK	 	A-1
	EXHIBIT B—FORM OF RIGHT CERTIFICATE	 	B-1




i








FOURTH AMENDED AND RESTATED RENEWED RIGHTS AGREEMENT  


        Fourth Amended and Restated Renewed Rights Agreement (this "Agreement"), dated as of May 28, 2004, between
Genzyme Corporation, a Massachusetts corporation (the "Company"), and American Stock Transfer & Trust Company, (the
"Rights Agent"). 


        This
Agreement amends, restates and supersedes the Renewed Rights Agreement dated as of March 16, 1999 (the "Renewed Agreement")
between the Company and the Rights Agent as it was amended and restated by the Amended and Restated Renewed Rights Agreement dated as of June 10, 1999 (the "First
Restated Agreement"), the Second Amended and Restated Renewed Rights Agreement dated as of December 18, 2000 (the "Second Amended
Agreement") as adjusted by the Certificate of Adjustment dated as of June 1, 2001 and the Third Amended and Restated Renewed Rights Agreement dated as of June 30,
2003 (the "Third Amended Agreement"). 



        WHEREAS,
on March 2, 1999, the Board of Directors of the Company (the "Board") (i) deemed it desirable and in the best
interest of the Company and its shareholders for the Company to renew the Company's shareholder rights plan, (ii) adopted the Renewed Agreement which became effective on March 28, 1999
(the "Effective Date") upon the expiration of the Company's original shareholder rights plan, (iii) authorized and declared a dividend
distribution of (x) one GGD Stock Purchase Right (a "GGD Stock Right") for each share of Genzyme General Division Common Stock (the
"GGD Stock"), $0.01 par value per share outstanding upon the Effective Date (y) one GTR Stock Purchase Right for each share of the Genzyme Tissue
Repair Division Common Stock $0.01 par value per share (the "GZTR Stock") outstanding upon the Effective Date and (z) one GMO Stock Purchase
Right for each share of Genzyme Molecular Oncology Division Common Stock, par value $.01 per share, ("GZMO Stock") outstanding upon the Effective Date,
and (iv) authorized and directed the issuance of one Right (as such number may be adjusted pursuant to Section 11 hereof) for each Common Share issued after the Effective Date (whether
originally issued or delivered from the Company's treasury) but prior to the earliest of the "Distribution Date," the "Redemption Date" and the "Final Expiration Date," each as defined in this
Agreement; 


        WHEREAS,
on May 26, 1999, the Board approved the First Restated Agreement, an amendment and restatement of the Renewed Agreement, which became effective upon the creation of the
Company's Genzyme Surgical Products Division Common Stock, par value $.01 per share (the "GZSP Stock"), and in connection with such First Restated
Agreement, the Board authorized and directed the issuance of one GSP Stock Purchase Right for each share of GZSP Stock issued by the Company (as such number may have been adjusted pursuant to
Section 11 thereof) on or after June 10, 1999 and prior to the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date; 



        WHEREAS,
on March 2, 2000 the Board approved the Second Amended Agreement, effective upon the (i) cancellation of the GZSP Stock and GZTR Stock and (ii) creation of
the Genzyme Biosurgery Division Common Stock, par value $.01 per share, of the Company ("GZBX Stock"); 


        WHEREAS,
on December 18, 2000, the (i) cancellation of the GZSP Stock and GZTR Stock and (ii) creation of the GZBX Stock became effective; and the Board authorized
and directed the issuance of one GZBX Stock Purchase Right for each share of GZBX Stock issued by the Company; 


        WHEREAS,
effective June 1, 2001, as a result of a two-for-one stock split of the Company's outstanding shares of GGD Stock effected, pursuant to
Section 11(a)(i) of the Second Amended Agreement, (i) the fraction of a share of Series A Preferred Stock (as defined below) purchasable upon proper exercise of each GGD
Stock Right was adjusted from one one-hundredth of a share to one two-hundredths of a share of Series A Preferred Stock, (ii) the purchase price and redemption
price with respect to each GGD Stock Right was adjusted from $300 and $.001 to $150 and $.0005, respectively, and (iii) each share of GGD Stock outstanding immediately after June 1, 2001
had issued with respect to it one GGD Stock Right; 


        WHEREAS,
on May 8, 2003, the Board approved the Third Amended Agreement, effective upon the exchange of each outstanding share of GZMO Stock or each outstanding share of GZBX
Stock, in each case, for a fraction of a share of GGD Stock (together, the "Exchanges"); 







 



        WHEREAS,
on June 30, 2003, the Exchanges occurred and the Board authorized the issuance of one GGD Stock Right for each share of GGD stock issued by the Company in connection with
the Exchange; 


        WHEREAS,
on February 28, 2004, the Board approved this Agreement, effective upon the filing of an amendment to and a restatement of the restated articles of organization of the
Company (the "Restated Articles") providing that the shares of Common Stock previously designated Genzyme General Division Common Stock no longer carry
such designation; 


        WHEREAS,
the Restated Articles were filed with the Secretary of the Commonwealth of Massachusetts on the date hereof; 


        WHEREAS,
the parties hereto are entering into this Agreement to re-designate each GGD Stock Right as a Stock Purchase Right (a
"Right"); and 


        WHEREAS,
each Right initially represents the right to purchase one two-hundredth of a share of the Company's Series A Junior Participating Preferred Stock, par value
$.01 per share ("Series A Preferred Stock"), such preferred shares having the rights and preferences set forth in the Restated Articles, a copy
of such terms being attached hereto as Exhibit A, upon the terms and subject to the conditions herein set forth; 


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



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



(a)    (i)
"Acquiring Person" shall mean any Person (as such term is hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall become, after the Effective Date, the Beneficial Owner (as such term is hereinafter defined) of Common Shares representing 15%
or more of the total Voting Rights of all the Common Shares of the Company then outstanding, but shall not include the Company, any Subsidiary (as such term is hereinafter defined) of the Company, or
any employee benefit plan of the Company or any Subsidiary of the Company, or any entity organized, appointed or established by the Company holding Common Shares for or pursuant to the terms of any
such plan. 


         (ii)  Notwithstanding
the foregoing, a Person shall not become an "Acquiring Person" solely as the result of an acquisition of Common Shares by the Company or any Subsidiary
which, by reducing the number of shares outstanding, increases the proportionate number of shares beneficially owned by such Person to represent 15% or more of the total Voting Rights of all the
Common Shares then outstanding as determined above; provided, however, that if a Person becomes the Beneficial Owner of 15% or more of the total Voting
Rights of Common Shares then outstanding as determined above solely by reason of such a share acquisition by the Company and such Person shall, after becoming the Beneficial Owner of such Common
Shares, become the Beneficial Owner of any additional Common Shares with Voting Rights by any means whatsoever (other than as a result of the subsequent occurrence of a stock dividend or a subdivision
of the Common Shares into a larger number of shares or a similar transaction), then such Person shall be deemed to be an "Acquiring Person." 


        (iii)  Notwithstanding
the foregoing, if a majority of the Board determines in good faith that a Person who would otherwise be an "Acquiring Person," as defined pursuant to
the foregoing provisions of this Section 1(a), has become such inadvertently, and such Person divests as promptly as practicable a sufficient number of Common Shares so that such Person would
no longer be an "Acquiring Person," as defined pursuant to the foregoing provisions of this Section 1(a), then such Person shall not be deemed to be an "Acquiring Person" for any purposes of
this Agreement. The determination of whether such Person's becoming an Acquiring Person shall have been inadvertent 



2







 




and
the determination of whether the divestment of sufficient shares shall have been made as promptly as practicable shall be made by the Board. 


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




        (c)   A
Person shall be deemed the "Beneficial Owner" of and shall be deemed to "beneficially own" any securities: 



          (i)  which
such Person or any of such Person's Affiliates or Associates beneficially owns, directly or indirectly; 



         (ii)  which
such Person or any of such Person's Affiliates or Associates has (A) the right to acquire (whether such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or understanding (whether or not in writing), or upon the exercise of conversion rights, exchange rights, rights (other than the Rights at any
time prior to the occurrence of a Triggering Event, as hereinafter defined, but thereafter including Rights acquired from and after the Distribution Date (as defined in Section 3(a) below)
other than Rights acquired pursuant to Section 3(a), 11(a)(iv) or 22 hereof), warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to beneficially own, securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are accepted for purchase or exchange; or (B) the right to vote or dispose of or "beneficial ownership" (as defined in
Rule 13d-3 of the General Rules and Regulations under the Exchange Act) of (including pursuant to any agreement, arrangement or understanding, whether or not in writing);  provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to beneficially own, any security if the agreement, arrangement or
understanding to vote such security (1) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the Exchange Act and (2) is not also then reportable on Schedule 13D under the Exchange Act (or any comparable or successor
report); or 


        (iii)  which
are beneficially owned, directly or indirectly, by any other Person (or any Affiliate or Associate thereof) with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting (except to the extent contemplated by the proviso to Section 1(c)(ii)(B))
or disposing of any securities of the Company. 




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


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


        (f)    "Common Shares" when used with reference to the Company shall mean the Common Stock or any other shares of capital stock
of the Company into which the Common Stock may be reclassified or changed. "Common Shares" when used with reference to any Person other than the Company shall mean the capital stock with the greatest
voting power of such other Person or equity interest having power to control or direct the management of such Person, or, if such other Person is a Subsidiary of another Person, the Person or Persons
which ultimately controls such first-mentioned Person. 


        (g)   "Common Stock" shall mean the common stock, par value $.01 per share, of the Company. 



        (h)   "Final Expiration Date" shall mean the close of business on March 28, 2009. 


3







 



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


        (j)    "Preferred Shares" shall mean shares of Series A Preferred Stock. 


        (k)   "Redemption Date" shall mean the time at which Rights are redeemed as provided in Section 23 hereof. 


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


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


        (n)   "Triggering Event" shall mean a Person becoming an Acquiring Person. 


        (o)   "Voting Rights" when used with reference to the capital stock of, or units of equity interest in, any Person shall mean
the right under ordinary circumstances to vote in the election of directors of such Person (if such Person is a corporation) or to participate in the management and control of such Person (if such
Person is not a corporation). 


        (p)   The
following terms shall have the meanings indicated in the following Sections of this Agreement: 



          (i)  "Act"—Section 9(b). 


         (ii)  "Adjustment Shares"—Section 11(b). 


        (iii)  "Agreement"—Preamble. 


        (iv)  "Board"—Preamble. 


         (v)  "Company"—Preamble. 


        (vi)  "Current Value"—Section 11(c)(i). 


       (vii)  "Distribution Date"—Section 3(a). 


      (viii)  "Effective Date"—Preamble. 


        (ix)  "Exchange Act"—Section 1(b) 


         (x)  "Exchange Consideration"—Section 11(c)(ii)(A). 


        (xi)  "Exchanges"—Preamble. 


       (xii)  "Extension Date"—Section 26. 


      (xiii)  "First Restated Agreement"—Preamble. 


      (xiv)  "GGD Stock"—Preamble. 



       (xv)  "GGD Stock Right"—Preamble. 


      (xvi)  "Nasdaq"—Section 11(d). 


     (xvii)  "NYSE"—Section 11(d). 


    (xviii)  "Principal Party"—Section 13(b). 


      (xix)  "Purchase Price"—Sections 4, 7, 11(b) and 13(a). 


       (xx)  "Redemption Price"—Section 23(a)(i). 


      (xxi)  "Renewed Agreement"—Preamble. 


     (xxii)  "Restatement Date"—the date of this Agreement. 



4







 




    (xxiii)  "Right"—Preamble. 


    (xxiv)  "Right Certificate"—Section 3(a). 


      (xxv)  "Rights Agent"—Preamble. 


    (xxvi)  "Second Restated Agreement"—Preamble. 


   (xxvii)  "Series A Preferred Stock"—Preamble. 


  (xxviii)  "Spread"—Section 11(c). 


     (xxix)  "Substitution Period"—Section 11(c). 


      (xxx)  "Third Restated Agreement"—Preamble 


     (xxxi)  "Trading Day"—Section 11(d)(i). 




        Section 2.    Appointment of Rights Agent.    The Company hereby appoints the Rights Agent to act as agent for
the Company and the holders of the Rights (who, in accordance with Section 3 hereof, shall prior to the Distribution Date also be the holders of the Common Shares) in accordance with the terms
and conditions hereof, and the Rights Agent hereby accepts such appointment. Upon prior written notice to the Rights Agent, the Company may from time to time appoint such co-Rights Agents
as it may deem necessary or desirable (the term "Rights Agent" being used herein to refer, collectively, to the Rights Agent together with any such
co-Rights Agent). 


        Section 3.    Issue of Right Certificates.    


        (a)   Until
the earlier of (i) the close of business on the tenth day (or such later date as may be determined by the Board) after the Shares Acquisition Date or
(ii) the close of business on the tenth Business Day (or such later date as may be determined by the Board) after the date of the commencement of, or of the first public announcement of the
intention of any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan of the Company or of any Subsidiary of the Company or any entity organized, appointed or
established by the Company holding Common Shares for or pursuant to the terms of any such plan) to commence, within the meaning of Rule 14d-2(a) of the General Rules and Regulations
under the Exchange Act, a tender or exchange offer the consummation of which would result in beneficial ownership by a Person of Common Shares representing 15% or more of the total Voting Rights of
all the outstanding Common Shares of the Company (the earliest of such dates being herein referred to as the "Distribution Date"), (x) the Rights
will be evidenced by the certificates for Common Stock registered in the names of the holders thereof (which certificates for Common Stock shall also be deemed to be certificates for Rights) and not
by separate Right Certificates, and (y) the right to receive Right Certificates will be transferable only in connection with the transfer of Common Shares. As soon as practicable after the
Distribution Date, the Company will prepare and execute, the Rights Agent will countersign, and the Company will send or cause to be sent (and the Rights Agent will, if requested, send) by
first-class, insured, postage-prepaid mail, to each record holder of Common Stock as of the close of business on the Distribution Date, at the address of such holder shown on the records of the
Company, a right certificate, in substantially the form of Exhibit B hereto (a "Right
Certificate"), evidencing one Right for each share of Common Stock so held. In the event that an adjustment in the number of Rights per Common Share has been made pursuant to
Section 11(a) hereof, at the time of distribution of the Right Certificates, the Company shall make the necessary and appropriate rounding adjustments (in accordance with Section 14(a)
hereof) so that Right Certificates representing only whole numbers of Rights are distributed and cash is paid in lieu of any fractional Rights. As of the Distribution Date, the Rights will be
evidenced solely by such Right Certificates. 



          (i)  Until
the earliest of the Distribution Date, the Redemption Date or Final Expiration Date, the surrender for transfer of any certificate for Common Shares shall also
constitute the transfer of the Rights associated with the Common Shares represented thereby. 



5







 

         (ii)  With
respect to certificates for Common Shares of the Company outstanding immediately prior to the Restatement Date, until the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date, the Rights will be evidenced by certificates for Common Shares as legended pursuant to the terms of the Renewed Agreement, and the registered holders of
the Common Shares of the Company shall also be the registered holders of the associated Rights. 


        (iii)  Certificates
for Common Shares which become outstanding (including, without limitation, reacquired Common Shares referred to in the last sentence of the following
paragraph (b) of this Section 3) on or after the Restatement Date but prior to the earliest of the Distribution Date, the Redemption Date or the Final Expiration Date shall have
impressed on, printed on, written on or otherwise affixed to them the following legend: 



This
certificate also evidences and entitles the holder hereof to certain Rights as set forth in the Renewed Rights Agreement between Genzyme Corporation & American Stock Transfer &
Trust Company (the "Rights Agreement"), as such Rights Agreement may from time to time be amended and/or restated, the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the principal executive offices of Genzyme Corporation. Under certain circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate certificates and will no longer be evidenced by this certificate. Genzyme Corporation will mail to the holder of this certificate a copy of the Rights Agreement
without charge after receipt of a written request therefor. Under certain circumstances, Rights beneficially owned by Acquiring Persons (as defined in the Rights Agreement) and any subsequent holder
of such Rights may become null and void. 





        (b)   Until
the Distribution Date, each Right associated with each Common Share shall be evidenced by the stock certificate representing such Common Share, and the surrender
for transfer of any such certificate shall also constitute the transfer of the Rights associated with the Common Shares represented thereby. In the event that the Company purchases or acquires any
Common Shares on or after the Effective Date but prior to the Distribution Date, any Rights associated with such Common Shares shall be deemed cancelled and retired so that the Company shall not be
entitled to exercise any Rights associated with the Common Shares which are no longer outstanding. 


        (c)   Notwithstanding
the requirements of Section 3(c), the omission of a legend shall not affect the enforceability of any part of this Agreement or the rights of any
holder of Rights. 


        Section 4.    Form of Right Certificates.    The Right Certificates (and the form of election to purchase
Preferred Shares and of assignment to be printed on the reverse thereof) shall be in substantially the form set forth as Exhibit B hereto, and
may have such marks of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange or quotation system on
which the Rights may from time to time be listed or quoted, or to conform to usage. Subject to the provisions of Sections 11 and 22 hereof, the Right Certificates shall entitle the holders thereof to
purchase such number of one two-hundredths of a Preferred Share as shall be set forth therein at the price per one two-hundredth of a Preferred Share set forth therein (the
"Purchase Price"), but the number of such one two-hundredths of a Preferred Share and the Purchase Price shall be subject to adjustment as
provided herein. 


        Section 5.    Countersignature and Registration.    


        (a)   The
Right Certificates shall be executed on behalf of the Company by its Chairman of the Board, its President or any Executive Vice President, either manually or by
facsimile signature, shall have affixed thereto the Company's seal or a facsimile thereof, and shall be attested by the Clerk or an Assistant Clerk (or Secretary of an Assistant Secretary) of the
Company, either manually or by 


6







 

facsimile
signature. The Right Certificates shall be countersigned manually, or, if permitted by the Company, by facsimile signature, by the Rights Agent and shall not be valid for any purpose unless
so countersigned. In case any officer of the Company who shall have signed any of the Right Certificates shall cease to be an officer of the Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Right Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect as though
the person who signed such Right Certificates had not ceased to be an officer of the Company; and any Right Certificate may be signed on behalf of the Company by any person who, at the actual date of
the execution of such Right Certificate, shall be a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such person was not such
an officer. 


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


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


        (a)   Subject
to the provisions of Sections 7(e) and 14 hereof, at any time after the close of business on the Distribution Date, and at or prior to the close of business on
the earlier of the Redemption Date or the Final Expiration Date, any Right Certificate or Right Certificates may be transferred, split up, combined or exchanged for another Right Certificate or Right
Certificates, entitling the registered holder to purchase a like number of one two-hundredths of a Preferred Share (or, following a Triggering Event, Common Shares, other securities or
property, as the case may be) as the Right Certificate or Right Certificates surrendered then entitled such holder (or former holder in the case of a transfer) to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate or Right Certificates shall make such request in writing delivered to the Rights Agent, and shall surrender the Right
Certificate or Right Certificates to be transferred, split up, combined or exchanged at the office of the Rights Agent designated for such purposes. Neither the Rights Agent nor the Company shall be
obligated to take any action whatsoever with respect to the transfer of any such surrendered Right Certificate until the registered holder shall have completed and signed the certificate contained in
the form of assignment on the reverse side of such Right Certificate and shall have provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall request. Thereupon the Rights Agent shall (subject to Section 7(e) hereof) countersign and deliver to the person entitled thereto a Right Certificate
or Right Certificates, as the case may be, as so requested. The Company may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates. 


        (b)   Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them, and, at the Company's request, reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, the Company will make and deliver a new Right Certificate of like tenor to
the Rights Agent for delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated. 



        (c)   Notwithstanding
any other provision hereof, the Company and the Rights Agent may amend this Rights Agreement to provide for uncertificated Rights in addition to or in
place of Rights evidenced by Right Certificates. 


7









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


        (a)   Subject
to Section 7(e) hereof, the registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon surrender of the Right Certificate, with the form of election to purchase and the certificate contained in the form of election to
purchase on the reverse side of the Right Certificate duly executed, to the Rights Agent at the principal offices of the Rights Agent, together with payment of the Purchase Price for the Preferred
Shares (or other shares, securities or property, as the case may be) as to which the Rights are exercised, at or prior to the earlier of the Redemption Date and the Final Expiration Date. 


        (b)   The
Purchase Price with respect to each Right shall initially be $150 for each one two-hundredth of a Series A Preferred Share and shall be subject to
adjustment from time to time as provided in Sections 11 and 13 hereof and shall be payable in lawful money of the United States of America in accordance with paragraph (c) below. 


        (c)   Upon
receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase and the certificate contained in the form of election to
purchase and the Right Certificate duly executed, accompanied by payment of the Purchase Price for the Preferred Shares (or other shares, securities or property, as the case may be) to be purchased
and an amount equal to any applicable transfer tax required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof in cash, or by certified check or cashier's
check payable to the order of the Company, the Rights Agent shall, subject to Section 20(k) hereof, thereupon promptly (i) (A) requisition from any transfer agent of the Preferred Shares
certificates for the number of Preferred Shares to be purchased (and the Company hereby irrevocably authorizes its transfer agent to comply with all such requests), or (B) if the Company shall
have elected to deposit the Preferred Shares issuable upon exercise of the Rights hereunder with a depositary agent, requisition from the depositary agent depositary receipts representing such number
of one two-hundredths of a Preferred Share as are to be purchased (in which case certificates for the Preferred Shares represented by such receipts shall be deposited by the transfer agent
with the depositary agent) and the Company hereby directs the depositary agent to comply with such request, (ii) when appropriate, requisition from the Company the amount of cash to be paid in
lieu of issuance of fractional shares in accordance with Section 14 hereof, (iii) promptly after receipt of such certificates or depositary receipts, cause the same to be delivered to or
upon the order of the registered holder of such Right Certificate, registered in such name or names as may be designated by such holder and (iv) when appropriate, after receipt, promptly
deliver such cash to or upon the order of the registered holder of such Right Certificate. In the event that the Company is obligated to issue other securities (including Common Shares), pay cash
and/or distribute other property pursuant to Section 11(a) hereof, the Company will make all arrangements necessary so that such other securities, cash and/or other property are available for
distribution by the Rights Agent, if and when appropriate. 


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


        (e)   Notwithstanding
anything in this Agreement to the contrary, any Rights beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of an Acquiring
Person, (ii) a transferee from an Acquiring Person (or of any such Associate or Affiliate) who becomes a transferee after the Acquiring Person becomes such (and any subsequent transferees of
such transferee), or (iii) a transferee of an Acquiring Person (or such Associate or Affiliate) who becomes a transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring Person to holders of equity interests in such 


8







 



Acquiring
Person or to any Person with whom the Acquiring Person has any continuing agreement, arrangement or understanding regarding the transferred Rights or (B) a transfer which the Board
has determined is part of a plan, arrangement or understanding which has as a primary purpose or effect the avoidance of this Section 7(e), shall become null and void without any further
action, and any holder (including any subsequent holder) of such Rights shall thereupon have no rights whatsoever with respect to such Rights, whether under any provision of this Agreement or
otherwise. The Company shall use all reasonable efforts to insure that the provisions of this Section 7(e) hereof are complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure or inability to make any determinations with respect to an Acquiring Person or its Affiliates, Associates or transferees hereunder. 


        (f)    Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect to a
registered holder upon the occurrence of any purported exercise as set forth in this Section 7 unless such registered holder shall have (i) completed and signed the certificate contained
in the form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such exercise, and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company shall request. 


        Section 8.    Cancellation and Destruction of Right Certificates.    All Right Certificates surrendered for the
purpose of exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in cancelled form,
or, if surrendered to the Rights Agent, shall be cancelled by it, and no Right Certificates shall be issued in lieu thereof except as expressly permitted by the provisions of this Agreement. The
Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise
than upon the exercise thereof. The Rights Agent shall deliver all cancelled Right Certificates to the Company, or shall, at the written request of the Company, destroy such cancelled Right
Certificates, and in such case shall deliver a certificate of destruction thereof to the Company. 


        Section 9.    Reservation and Availability of Preferred Shares.    



        (a)   The
Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued Preferred Shares (and, following the occurrence
of a Triggering Event, Common Shares and/or other securities) or any Preferred Shares (and, following the occurrence of a Triggering Event, Common Shares and/or other securities) held in its treasury,
the number of Preferred Shares (and, following the occurrence of a Triggering Event, Common Shares and/or other securities) that will be sufficient (in accordance with the terms of this Agreement,
including Section 11(c)(i) hereof) to permit the exercise in full of all outstanding Rights. Prior to the occurrence of a Triggering Event, the Company shall not be obliged to cause to
be reserved and kept available out of its authorized and unissued Common Shares or shares of preferred stock (other than Preferred Shares), any such Common Shares or any shares of preferred stock
(other than Preferred Shares) to permit exercise of outstanding Rights. 


        (b)   If
then required by applicable law, the Company shall use its best efforts to (i) file, either (A) as soon as practicable following the earliest date after
the occurrence of a Triggering Event as to which the consideration to be delivered by the Company upon exercise of the Rights has been determined pursuant to this Agreement, or (B) as soon as
is required by law following the Distribution Date, as the case may be, a registration statement under the Securities Act of 1933, as amended (the
"Act"), with respect to the securities purchasable upon exercise of the Rights on an appropriate form, (ii) cause such registration statement to
become effective as soon as practicable after such filing, and (iii) cause such registration statement to remain effective (with a prospectus at all times meeting the requirements of the Act)
until the earlier of (A) the date as of which the Rights are no longer 


9







 



exercisable
for such securities, and (B) the date of the expiration of the Rights. If then required by applicable law, the Company will also take such action as may be appropriate under the
securities or "blue sky" laws of the various states. The Company may temporarily suspend, for a period of time not to exceed ninety (90) days after the date set forth in clause (i) of
this Section 9(b), the exercisability of the Rights in order to prepare and file such registration statement and permit it to become effective or to comply with such blue sky laws. Upon any
such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction unless the requisite qualification in such jurisdiction shall have been obtained. 


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


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


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


        Section 11.    Adjustment in Rights; Exchange of Rights; Certain Covenants.    The Purchase Price, the number
of Preferred Shares (or number and kind of other shares of capital stock, as the case may be) covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11. 



        (a)    Anti-Dilution Adjustments; Adjustments, generally.    


          (i)  To
preserve the actual or potential economic value of the Rights, if at any time after the date of this Agreement there shall be any change in the Common Shares or the
Preferred Shares, whether by reason of stock dividends, stock splits, recapitalizations, reclassifications, mergers, consolidations, combinations or exchanges of securities, split-ups,
split-offs, spin-offs, liquidations, 



10







 




other
similar changes in capitalization, any distribution or issuance of cash, assets, evidences of indebtedness or subscription rights, options or warrants to holders of Common Shares or Preferred
Shares, as the case may be (other than the Rights or regular quarterly cash dividends) or otherwise, then, in each such event adjustments in the number of Preferred Shares (or the number and kind of
other securities) issuable upon exercise of each Right, the Purchase Price and Redemption Price in effect at such time (including the number of Rights or fractional Rights associated with each Common
Share) shall be made if and as deemed appropriate by the Board, such that following such adjustments such event shall not have had the effect of reducing or limiting the benefits the holders of the
Rights would have had absent such event. 


         (ii)  If,
as a result of an adjustment made pursuant to this Section 11, the holder of any Right thereafter exercised shall become entitled to receive any securities
other than Preferred Shares, thereafter the number of such securities so receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions of Section 11(a)(i), and the provisions of Sections 7, 9 and 10 with respect to the Preferred Shares shall apply, as nearly as reasonably may be, on
like terms to any such other securities. 


        (iii)  All
Rights originally issued by the Company subsequent to any adjustment made to the amount of Preferred Shares or other securities relating to a Right shall evidence
the right to purchase, for the Purchase Price, the adjusted number and kind of securities purchasable from time to time hereunder upon exercise of the Rights, all subject to further adjustment as
provided herein. 


        (iv)  Irrespective
of any adjustment or change in the Purchase Price or the number of Preferred Shares or number or kind of other securities issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue to express the terms which were expressed in the initial Right Certificates issued hereunder. 



         (v)  Unless
the Board chooses otherwise, no adjustment in the Purchase Price shall be made if such adjustment would not result in an increase or decrease of at least 1% in
the Purchase Price; provided, however, that any such adjustments which by reason of this Section 11(a) are not made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the nearest ten-thousandth of a Common Share or other
share or one-millionth of a Preferred Share as the case may be. Notwithstanding the first sentence of this Section 11(a), any adjustment made under this Section 11 shall be
made no later than the earlier of (i) three years from the date of the transaction that is the cause of such adjustment or (ii) the date of the expiration of the right to exercise any
Rights. 


        (vi)  The
Company may elect on or after the date of any adjustment of the Purchase Price to adjust the number of Rights, in substitution for any adjustment in the number of
Preferred Shares or other securities purchasable upon the exercise of a Right. Each of the Rights outstanding after such adjustment of the number of Rights shall be exercisable for the number of one
two-hundredths of a Preferred Share or number of other securities for which a Right was exercisable immediately prior to such adjustment. Each Right held of record prior to such adjustment
of the number of Rights shall become that number of Rights (calculated to the nearest one ten-thousandth) obtained by dividing the Purchase Price in effect immediately prior to adjustment
of the Purchase Price by the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This record date may be the date on which the Purchase Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued, shall be at 



11







 




least
10 days later than the date of the public announcement. If Right Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(a)(vi), the
Company shall, as promptly as practicable, cause to be distributed to holders of record of Right Certificates on such record date Right Certificates evidencing, subject to Section 14 hereof,
the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution
and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the
Rights to which such holders shall be entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed and countersigned in the manner provided for herein and shall be
registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement. 


       (vii)  Before
taking any action that would cause an adjustment reducing the Purchase Price below one two-hundredth of the then par value, if any, of the Preferred
Shares issuable upon exercise of the Rights, the Company shall take any corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue
fully paid and non-assessable Preferred Shares at such adjusted Purchase Price. 


      (viii)  Anything
in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price, in addition to those
adjustments expressly required by this Section 11, as and to the extent that it in its sole discretion shall determine to be advisable in order that any (a) consolidation or subdivision
of the Preferred Shares, (b) issuance wholly for cash of any Preferred Shares at less than the current market price, (c) issuance wholly for cash of Preferred Shares or securities which
by their terms are convertible into or exchangeable for Preferred Shares, (d) dividends on Preferred Shares payable in Preferred Shares or (e) issuance of rights, options or warrants
referred to hereinabove in Section 11(b), hereafter made by the Company to holders of its Preferred Shares shall not be taxable to such shareholders. 


        (ix)  In
any case which action taken pursuant to Section 11(a)(i) requires that an adjustment be made effective as of a record date for a specified event, the
Company may elect to defer until the occurrence of such event the issuing to the holder of any Right exercised after such record date the Preferred Shares and/or other securities, if any, issuable
upon such exercise over and above the Preferred Shares and/or other securities, if any, issuable before giving effect 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 securities upon the
occurrence of the event requiring such adjustment. 


        (b)    Initial Adjustment Upon Triggering Event.    Upon the first occurrence of a Triggering Event (except as
otherwise provided in this Agreement), proper provision shall be made so that each holder of a Right, except as provided below and in Section 7(e) hereof, shall thereafter have a right to
receive, upon exercise thereof at the then current Purchase Price in accordance with the terms of this Agreement, in lieu of Preferred Shares and subject to the provisions of Section 11(a),
such number of shares of Common Stock as shall equal the result obtained by (x) multiplying the then current Purchase Price by the number of one two-hundredths of a Preferred Share
for which a Right was exercisable immediately prior to the Triggering Event (whether or not such Right was then exercisable), and dividing that product (which, following such Triggering Event, shall
be referred to as the "Purchase Price" for all purposes of this Agreement) by (y) 50% of the then current per share market price of the Common Stock (determined pursuant to
Section 11(d)), on the date of the occurrence of the Triggering Event (such number of shares being referred to herein as the "Adjustment
Shares"). Notwithstanding the foregoing, upon the occurrence of the Triggering Event, any Rights that are or were on or after the earlier of the Distribution Date or the date
of the Triggering Event beneficially owned by an Acquiring Person (or any Associate or Affiliate of 



12







 




such
Acquiring Person) or by certain transferees of such Persons as specified in Section 7(e), shall become void and any holder (including subsequent holders) of such Rights shall thereafter
have no right to exercise such Rights under any provision of this Agreement. Any Right Certificate issued pursuant to Section 3 or Section 22 hereof that represents Rights beneficially
owned by an Acquiring Person or any Associate or Affiliate thereof and any Right Certificate issued at any time upon the transfer of any Rights to an Acquiring Person or any Associate or Affiliate
thereof or to any nominee of such Acquiring Person, Associate or Affiliate, and any Right Certificate issued pursuant to Section 6, 7(d), 7(e) or 22 hereof or this Section 11 upon
transfer, exchange, replacement or adjustment of any other Right Certificate referred to in this sentence, shall contain the following legend: 



The
Rights represented by this Right 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). This Right Certificate and the Rights represented hereby may become void in the circumstances specified in the Rights Agreement, including Sections 7(e) and 11(a)(ii) thereof; 





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 or if a holder fails to certify upon transfer or exchange in the
space provided on the Right Certificate that such holder is not an Acquiring Person or an Affiliate or Associate thereof. 



        (c)    Other Adjustments Upon or Following Triggering Event.    


          (i)  Use of Common Equivalents or Cash. In the event that (x) the total of the Common Shares that are issued but not
outstanding and authorized but unissued (excluding Common Shares reserved for issuance pursuant to the specific terms of any indenture, option plan or other agreement) is not sufficient to permit the
exercise in full of the Rights in accordance with Section 11(b) or 11(c)(ii) hereof, or (y) the total number of Common Shares available for exercise of the Rights in accordance
with Section 11(b) hereof is sufficient to permit the exercise in full of the Rights in accordance with Section 11(b) but the Board determines that the exercise of the Rights in
accordance with Section 11(b) above will not afford adequate protection to the shareholders of the Company and that shareholders should be given an option to acquire a substitute for the
Adjustment Shares, and subject to such limitations as are necessary to prevent a default under any agreement for money borrowed to which the Company is a party, then the Board shall:
(A) determine the excess of (1) the value of the Adjustment Shares issuable upon the exercise of a Right (the "Current Value") over
(2) the Purchase Price (such excess, the "Spread"), and (B) with respect to each Right, make adequate provision to substitute for, or
provide an election to acquire in lieu of, the Adjustment Shares, upon payment of the applicable Purchase Price (which term shall include any reduced Purchase Price) any combination of the following
having an aggregate value equal to the Current Value (such aggregate value to be determined by the Board based upon the advice of a nationally recognized investment banking firm selected by the
Board): (1) voting and other securities of one or more subsidiaries of the Company, (2) a reduction in the Purchase Price, (3) Common Shares and/or other equity securities of the
Company and/or (4) debt securities of the Company and/or cash and other assets; provided, however, if the Company shall not have made adequate
provision to deliver value pursuant to clause (B) above within thirty (30) days following the first occurrence of a Triggering Event, then the Company shall be obligated to deliver, upon
the surrender for exercise of a Right and without requiring payment of the Purchase Price, Common Shares (to the extent available) and, if necessary, cash, which securities and/or cash that in the
aggregate are equal to the Spread. If the Board shall determine in good faith that it is likely that sufficient additional Common Shares could be authorized for issuance upon exercise in full of the
Rights, the thirty (30) day period set forth 



13







 




above
may be extended to the extent necessary, but not more than ninety (90) days following the first occurrence of a Triggering Event, in order that the Company may seek shareholder approval
for the authorization of such additional shares (such period, as it may be extended, the "Substitution Period"). To the extent that the Board determines
that some action need be taken pursuant to the first and/or second sentences of this Section 11(c)(i), the Company (x) shall provide, subject to Section 7(e) hereof, that such
action shall apply uniformly to all outstanding Rights, and (y) may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek any authorization
of additional shares and/or to decide the appropriate form of distribution to be made pursuant to such first sentence and to determine the value thereof. In the event of any such suspension, the
Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(c)(i), the value of the Common Shares shall be the current per share market price (as determined pursuant to Section 11(d) hereof) of the Common
Shares on the date of the first occurrence of a Triggering Event. 




        The
provisions of this Section 11(c)(i) shall apply only to Common Shares of the Company and shall not apply to the securities of any other Person. 




        (ii)    Exchange Option.    



        (A)  At
any time after the occurrence of a Triggering Event and prior to the earlier of (i) the time any Person, together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the Common Shares then outstanding and (ii) the occurrence of a Section 13(a) Event, the Board may, at its option, cause the
Company to exchange mandatorily all or part of the then outstanding and exercisable Rights (which shall not include Rights that shall have become null and void pursuant to the provisions of
Section 7(e) hereof) for consideration per Right consisting of one half of the securities that would be issuable at such time upon the exercise of one Right in accordance with
Section 11(b) (the consideration issuable per Right pursuant to this Section 11(c)(ii)(A) being the "Exchange Consideration"). Any partial
exchange shall be effected on a pro rata basis based on the number of Rights (other than Rights which have become void pursuant to the provisions of Section 7(e) hereof) held by each holder of
Rights. If the Board elects to exchange all the Rights for Exchange Consideration pursuant to this Section 11(c)(ii)(A) prior to the physical distribution of the Rights Certificates, the
Company may distribute the Exchange Consideration in lieu of distributing Rights Certificates, in which case for purposes of this Rights Agreement holders of Rights shall be deemed to have
simultaneously received and surrendered for exchange Rights Certificates on the date of such distribution. 




14













  




        (B)  Immediately
upon the action of the Board ordering the exchange of any particular Rights pursuant to this Section 11(c)(ii) and without any further action
and without any notice, the right to exercise those particular Rights shall terminate and the only right a holder shall have thereafter with respect to any of those particular Rights shall be to
receive the Exchange Consideration. The Company shall promptly give public notice of any such exchange and in addition, the Company shall promptly mail a notice of any such exchange to all of the
holders of such Rights in accordance with Section 25 of this Agreement; provided, however, that the failure to give, any delay in giving or any
defect in, such notice shall not affect the validity of such exchange. Each such notice of exchange will state the method by which the exchange of the Exchange Consideration for Rights will be
effected and, in the event of any partial exchange, the number of Rights which will be exchanged. In the event the Exchange Consideration consists of Common Shares, the Company shall not be required
to issue fractions of Common Shares or to distribute certificates which evidence fractional Common Shares. In lieu of such fractional Common Shares, the Company shall pay to the registered holders of
the Rights Certificates with regard to which such fractional Common Shares would otherwise be issuable an amount in cash equal to the product derived by multiplying (x) the subject fraction, by
(y) the last sale price of the Common Shares on the fifth Trading Day following the public announcement of the exchange by the Company, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices on such day, in either case on a when issued basis (taking into account the exchange), as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the Nasdaq National Market (or, if the Common Shares are not so listed or traded, then as determined in the manner provided in
Section 11(d)(i) for determining "current per share market price," adjusted to take into account the exchange). In determining whether any particular holder shall be obligated to receive
cash in lieu of a fractional share, the holder shall be entitled to have all Rights beneficially owned by such holder aggregated so that only one fractional share shall be attributable to all the
Rights so beneficially owned. 




        (d)    Computation of Current Market Price.    


          (i)  For
the purpose of any computation hereunder, other than computations made pursuant to 11(c)(i) hereof, the "current per share market price" of the Common Shares
on any date shall be deemed to be the average of the daily closing prices per share of such Common Shares for the 30 consecutive Trading Days (as such term is hereinafter defined) immediately prior to
such date and for purposes of computations made pursuant to Section 11(c)(i) hereof, the "current per share market price" of the Common Shares on any date shall be deemed to be the
average of the daily closing prices per Common Share for the 10 consecutive Trading Days immediately following such date; provided, however, that in the
event that the current per share market price of the Common Shares is determined during a period following the announcement by the issuer of such Common Shares of (A) a dividend or distribution
on such Common Shares payable in such Common Shares or securities convertible into such Common Shares, or (B) any subdivision, combination or reclassification of such Common Shares, and prior
to the expiration of the requisite 30 or 10 Trading Day period, as the case may be, after the ex-dividend date for such dividend or distribution, or the record date for such subdivision,
combination or reclassification, then, and in each such case, the current market price shall be appropriately adjusted to reflect the current market price per Common Share equivalent. The closing
price for each day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported
in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange (the
"NYSE") or, if the Common Shares are not listed or admitted to trading on the NYSE, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities exchange on which the Common Shares are 



15







 




listed
or admitted to trading or, if the Common Shares are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by The Nasdaq ("Nasdaq") system or such other system then
in use, or, if on any such date the Common Shares are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market
in the Common Shares selected by the Board. If on any such date no market maker is making a market in the Common Stock, the fair value of such shares on such date as determined in good faith by the
Board shall be used. The term "Trading Day" shall mean a day on which the principal national securities exchange on which the Common Shares are listed
or admitted to trading is open for the transaction of business or, if the Common Shares are not listed or admitted to trading on any national securities exchange, a Business Day. If the Common Shares
are not publicly held or not so listed or traded, "current market price" per share shall mean the fair value per share as determined in good faith by the Board, whose determination shall be described
in a statement filed with the Rights Agent and shall be conclusive for all purposes. 



         (ii)  For
the purpose of any computation hereunder, the "current per share market price" of the Preferred Shares shall be determined in the same manner as set forth above for
Common Shares in Section 11(d)(i) (other than the last sentence thereof). If the current per share market price of the Preferred Shares cannot be determined in the manner provided above,
the "current per share market price" of the shares of Series A Preferred Stock shall be conclusively deemed to be the current per share market price of the shares of Common Stock (appropriately
adjusted to reflect any stock splits, stock dividends, recapitalizations or similar transactions occurring after the date hereof), multiplied by two hundred. If neither the applicable Common Shares
nor the Preferred Shares are publicly held or so listed or traded, "current per share market price" shall mean the fair value per share as determined in
good faith by the Board, whose determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. 


        (e)    Certain Covenants.    The Company covenants and agrees that, after the Distribution Date, it: 


          (i)  will
not, and shall not permit any Subsidiary to, (i) consolidate with, (ii) merge with or into, or (iii) sell or transfer, in one or more
transactions, assets or earning power aggregating more than 50% of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person if at the time of or
immediately after such consolidation, merger or sale there are any rights, warrants or other instruments or securities outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights. 


         (ii)  will
not, except as permitted by Section 23 or Section 26 hereof, take (or permit any Subsidiary to take) any action which at the time it is reasonably
foreseeable will diminish substantially or otherwise eliminate the benefits intended to be afforded by the Rights, provided, however, that the issuance
of additional Rights pursuant hereto, including by action of the Board under Section 22 hereof, shall not be deemed to violate this Section 11(e)(ii). 




        Section 12.    Certificate of Adjustment.    Whenever an adjustment is made as provided in Sections 11 and 13
hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment, and a brief statement of the facts accounting for such adjustment, (b) promptly file with the
Rights Agent and with each transfer agent for the Common Shares or the Preferred Shares a copy of such certificate and (c) mail a brief summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof. The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment therein contained and shall not be deemed to have knowledge
of any such adjustment unless and until it shall have received such certificate. 


16







 

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



        (a)   In
the event that, following the Distribution Date, directly or indirectly, any transactions specified in the following clause (i), (ii) or (iii) of
this Section 13(a) shall be consummated: 



          (i)  the
Company shall consolidate with, or merge with and into, any other Person and the Company shall not be the continuing or surviving corporation of any such
consolidation or merger; 


         (ii)  any
Person shall consolidate with the Company, or merge with and into the Company and the Company shall be the continuing or surviving corporation of such merger and,
in connection with such merger, all or part of the Common Shares shall be changed into or exchanged for stock or other securities of any other Person (or the Company) or cash or any other property; or 


        (iii)  the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets or earning
power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any other Person or Persons other than the Company or any Subsidiary of the
Company; provided, however, that this clause (iii) of Section 13(a) hereof shall not apply to the pro rata distribution by the Company of
assets (including securities) of the Company or any of its Subsidiaries to all holders of Common Shares of the Company in accordance with each such holder's interest in such assets prior to the
distribution; 




then,
and in each such case, proper provision shall be made so that (i) each holder of a Right (except as otherwise provided herein) shall thereafter have the right to receive, upon the
exercise thereof in accordance with the terms of this Agreement, such number of validly authorized and issued, fully paid, non-assessable and freely tradable Common Shares of the Principal
Party (as hereinafter defined), not subject to any rights of first refusal, redemption or repurchase, as shall be equal to the result obtained by (1) multiplying the then current Purchase Price
by the number of one two-hundredths of a Preferred Share for which a Right is then exercisable immediately prior to the first occurrence of any of the events described in clauses (i),
(ii) or (iii) of this Section 13(a) (a "Section 13(a) Event"), or, if a Triggering Event has occurred prior to the
Section 13(a) Event, multiplying the number of such fractional shares for which a Right was exercisable immediately prior to the Triggering Event hereof by the Purchase Price immediately prior
to such Triggering Event, and dividing that product (which, following the Section 13(a) Event, shall thereafter be referred to as the "Purchase Price" for all purposes of this Agreement) by
(2) 50% of the then current per share market price of the Common Shares of such other Person (determined pursuant to Section 11(d)) on the date of consummation of such consolidation,
merger, sale or transfer; (ii) such Principal Party shall thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale or transfer, all the obligations and duties
of the Company pursuant to this Agreement; (iii) the term "Company" shall thereafter be deemed to refer to such issuer, it being specifically intended that the provisions of Section 11
hereof shall apply only to such Principal Party following the first occurrence of a Section 13(a) Event; (iv) such Principal Party shall take such steps (including, but not limited to,
the reservation of a sufficient number of its Common Shares in accordance with Section 9 hereof) in connection with such consummation as may be necessary to assure that the provisions hereof
shall thereafter be applicable, as nearly as reasonably may be, in relation to the Common Shares thereafter deliverable upon the exercise of the Rights; and (v) the provisions of Sections 11(b)
and 11(c)(i) hereof shall thereafter be of no effect following the first occurrence of a Section 13(a) Event. The Company shall not enter into any transaction of the kind referred to in
this Section 13(a) if at the time of such transaction there are any rights, warrants, instruments or securities outstanding or any agreements or arrangements which, as a result of the
consummation of such transaction, would substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights. 


17







 

        (b)   "Principal
Party" shall mean 



          (i)  in
the case of any transaction described in clause (i) or (ii) of the first sentence of Section 13(a), the Person that is the issuer of any
securities into which Common Shares of the Company are converted in such merger or consolidation, and if no securities are so issued, the Person that is the other party to such merger or
consolidation; and 


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




provided, however, that in any such case, (1) if the Common Shares of such Person are not at such time and have not been continuously over the
preceding twelve (12) month period registered under Section 12 of the Exchange Act, and such Person is a direct or indirect Subsidiary of another Person the Common Shares of which are
and have been so registered, "Principal Party" shall refer to such other Person; and (2) in case such Person is a Subsidiary, directly or indirectly, of more than one Person, the Common Shares
of two or more of which are and have been so registered, "Principal Party" shall refer to whichever of such Persons is the issuer of the Common Shares having the greatest aggregate market value. 



        (c)   The
Company shall not consummate any such consolidation, merger, sale or transfer unless the Principal Party shall have a sufficient number of authorized Common Shares,
which have not been issued or reserved for issuance, to permit the exercise in full of the Rights in accordance with this Section 13 and unless prior thereto the Company and such Principal
Party shall have executed and delivered to the Rights Agent a supplemental agreement providing for the terms set forth in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of any consolidation, merger or sale of assets mentioned in paragraph (a) of this Section 13, the Principal Party will: 



          (i)  prepare
and file a registration statement under the Act, with respect to the Rights and the securities purchasable upon exercise of the Rights on an appropriate
form, and will use its best efforts to cause such registration statement to (A) become effective as soon as practicable after such filing and (B) remain effective (with a prospectus at
all times meeting the requirements of the Act) until the Final Expiration Date; and 


         (ii)  deliver
to holders of the Rights historical financial statements for the Principal Party and each of its Affiliates which comply in all respects with the requirements
for registration on Form 10 under the Exchange Act. 




        The
provisions of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers. In the event that one of the transactions described in
Section 13(a) hereof shall occur at any time after the occurrence of a Triggering Event, the Rights which have not theretofore been exercised shall thereafter become exercisable in the manner
described in Section 13(a). 


        (d)   Notwithstanding
any other provision of this Agreement, no adjustment to the number or kind of shares (or fractions of a share), cash or other property for which a Right
is exercisable or the number of Rights outstanding or associated with any Common Share or any similar or other adjustment shall be made or be effective if such adjustment would have the effect of
reducing or limiting the benefits the holders of the Rights would have had absent such adjustment, including, without limitation, the benefits under Sections 11 and 13, unless the terms of this
Agreement are amended so as to preserve such benefits, provided that this paragraph shall not prevent any change prior to the Distribution Date
permitted by Section 26(a) and provided that this Section 13(d) shall not be deemed to limit or impair the right to engage in an exchange
pursuant to Section 11(c)(ii). 


18







 



        Section 14.    Fractional Rights and Fractional Shares.    


        (a)   The
Company shall not be required to issue fractions of Rights except prior to the Distribution Date as the Board may in its discretion determine in effecting an
adjustment in the number of Rights pursuant to Section 11(a) hereof, or to distribute Right Certificates which evidence fractional Rights. In lieu of such fractional Rights, there shall be paid
to the registered holders of the Right Certificates with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of
a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average
of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the
NYSE or, if the Rights are not listed or admitted to trading on the NYSE, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal
national securities exchange on which the Rights are listed or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by Nasdaq or such other system then in use or, if on any such
date the Rights are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by the
Board. If on any such date no such market maker is making a market in the Rights the fair value of the Rights on such date as determined in good faith by the Board shall be used. 


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


        (c)   Following
the occurrence of a Triggering Event, the Company shall not be required to issue fractions of Common Shares upon exercise of the Rights or to distribute
certificates that evidence fractional Common Shares. In lieu of fractional Common Shares, the Company may pay to the registered holders of Right Certificates at the time such Rights are exercised as
herein provided an amount in cash equal to the same fraction of the current market value of one Common Share. For purposes of this Section 14(c), the current market value of one Common Share
shall be the closing price of one Common Share (as determined pursuant to Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of such exercise. 


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


19







 



        Section 15.    Rights of Action.    All rights of action in respect of this Agreement, excepting the rights of
action given to the Rights Agent under Sections 18 and 20 hereof, are vested in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the registered holders
of the Common Shares); and any registered holder of any Right Certificate (or, prior to the Distribution Date, of the Common Shares), without the consent of the Rights Agent or of the holder of any
other Right Certificate (or, prior to the Distribution Date, of the Common Shares), may, in his own behalf and for his own benefit, enforce, and institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to exercise the Rights evidenced by such Right Certificate in the manner provided in such Right Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for
any breach of this Agreement and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened violations of, the obligations of any Person
subject to this Agreement. 


        Section 16.    Agreement of Right Holders.    Every holder of a Right, by accepting the same, consents and
agrees with the Company and the Rights Agent and with every other holder of a Right that: 


        (a)   prior
to the Distribution Date, the Rights will be transferable only in connection with the transfer of the Common Shares; 


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



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


        (d)   notwithstanding
anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any liability to any holder of a Right or other Person as
a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority
prohibiting or otherwise restraining performance of such obligation. 


        Section 17.    Right Certificate Holder Not Deemed a Shareholder.    No holder, as such, of any Right
Certificate shall be entitled to vote, receive dividends or be deemed for any purpose the holder of the Preferred Shares or any other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions affecting shareholders (except as provided in Section 24 hereof), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by such Right Certificate shall have been exercised in accordance with the provisions hereof. 


20









   
        Section 18.    Concerning the Rights Agent.    


        (a)   The
Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder and, from time to time, on demand of the Rights Agent,
its reasonable expenses and counsel fees and other disbursements incurred in the administration and execution of this Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability, or expense, incurred without negligence, bad faith or willful 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 may arise under this Agreement. The indemnity provided herein shall survive the expiration of the Rights and the termination of this Rights Agreement. 



        (b)   The
Rights Agent shall be fully indemnified against, shall be protected from and shall incur no liability or expense for, or in respect of any action taken, suffered or
omitted by it in connection with, its administration of this Agreement in reliance upon any Right Certificate or certificate for the Preferred Shares or Common Shares or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or acknowledged, by the proper person or persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof.
Such indemnity shall specifically include any loss, liability or expense which the Rights Agent may suffer in administering this Agreement against a Person who was an Acquiring Person or an Affiliate
or an Associate of an Acquiring Person and any costs and expenses of defending against any claim of liability from such Person, Acquiring Person or Affiliate or Associate of such Acquiring Person. 


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


        (a)   Any
corporation into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any corporation resulting from any
merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any corporation succeeding to the corporate trust business of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto,  provided that such
corporation would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. In case
at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the Right Certificates shall have been countersigned but not delivered, any such successor Rights
Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement. 


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


21







 



        Section 20.    Duties of Rights Agent.    The Rights Agent undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound: 



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


        (b)   Whenever
in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter be proved or established by
the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved
and established by a certificate signed by any one of the Chairman of the Board, the President, any Vice President, the Treasurer or the Clerk (or Secretary) of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the Rights Agent for any action taken or suffered in good faith by it under the provisions of this Agreement in reliance upon such
certificate. 


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


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


        (e)   The
Rights Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due execution hereof
by the Rights Agent) or in respect of the validity or execution of any Right Certificate (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right Certificate; nor shall it be responsible for any change in the exercisability of the Rights (including the Rights becoming void
pursuant to Section 11(b) hereof) or any adjustment in the terms of the Rights (including the manner, method or amount thereof) provided for in Sections 3, 11, 13 or 23, or the ascertaining of
the existence of facts that would require any such change or adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after receipt of a certificate furnished pursuant
to Section 13 describing such change or adjustment); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Preferred
Shares to be issued pursuant to this Agreement or any Right Certificate or as to whether any Preferred Shares will, when issued, be validly authorized and issued, 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 one of the Chairman of the
Board, the President, any Vice President, the Clerk (or Secretary) or the Treasurer of the Company, and to apply to such officers for advice or instructions in connection with its duties, and it shall
not be liable for any action taken or suffered to be taken by it in good faith in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions. Any
application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken or omitted by the Rights Agent
under this Rights Agreement and the date on or 


22







 



after
which such action shall be taken or such omission shall be effective. The Rights Agent shall not be liable for any action taken by, or omission of, the Rights Agent in accordance with a proposal
included in any such application on or after the date specified in such application (which date shall not be less than five Business Days after the date any officer of the Company actually receives
such application, unless any such officer shall have consented in writing to an earlier date) unless, prior to taking any such action (or the specified effective date in the case of an omission), the
Rights Agent shall have received written instructions in response to such application specifying the action to be taken or omitted. 


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


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



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


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


        Section 21.    Change of Rights Agent.    The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement upon 30 days' notice in writing mailed to the Company and to each transfer agent of the Common Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates by first-class mail. The Company may remove the Rights Agent or any successor Rights Agent upon 30 days' notice in writing, mailed
to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Shares or Preferred Shares by registered or certified mail, and to the holders of the Right
Certificates by first-class mail. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Right Certificate (who shall, with such notice, submit his Right Certificate for inspection by the Company), then the registered holder of
any Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such a court, shall
be a corporation organized and doing business under the laws of the United States or of any state of the United States in good standing, which is authorized under such laws to exercise corporate trust
powers and is subject to supervision or examination by federal or state authority and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least
$50 million. After 


23







 



appointment,
the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed; but
the predecessor Rights Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any such appointment the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares or Preferred Shares, and mail a notice thereof in writing to the registered holders of the Right Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be. 



        Section 22.    Issuance of New Right Certificates.    Notwithstanding any of the provisions of this Agreement
or of the Rights to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such form as may be approved by its Board to reflect any adjustment or change in the
Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this Agreement. In addition,
the Company may, if deemed necessary or appropriate by the Board, issue Right Certificates in connection with the issuance or sale of Common Shares following the Distribution Date. 



        Section 23.    Redemption.    


        (a)   (i)
The Board may, at its option, at any time prior to 5:00 p.m., Massachusetts time, on the earlier of (A) the tenth day following the Shares Acquisition
Date (or such later date as may be determined by the Board) or (B) the Final Expiration Date, redeem all but not less than all the then outstanding Rights at a redemption price of $.0005 per
Right, appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price being hereinafter referred to as the
"Redemption Price"). Notwithstanding anything contained in this Agreement to the contrary, the Rights shall not be exercisable pursuant to
Section 11(b) or 11(c) at a time when the Rights are then redeemable hereunder. 



         (ii)  Following
the occurrence of a Shares Acquisition Date but prior to any event described in Section 13(a), the Board may redeem all but not less than all of the
then outstanding Rights at the Redemption Price in connection with any event, not involving an Acquiring Person or an Affiliate or Associate of an Acquiring Person, that either (A) is of the
type specified in Section 13(a) or (B) involves a Person merging into the Company or otherwise combining with the Company, where the Company shall be the continuing or surviving
corporation of such merger or combination and the Common Shares of the Company shall remain outstanding and not changed into or exchanged for stock or other securities of any other Person or the
Company or cash or any other property, 




        (b)   In
the case of a redemption permitted under Section 23(a), immediately upon the action of the Board ordering the redemption of the Rights, evidence of which shall
have been filed with the Rights Agent and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights
shall be to receive the Redemption Price. Within ten days after the action of the Company ordering the redemption of the Rights, the Company shall give notice of such redemption to the holders of the
then outstanding Rights by mailing such notice to all such holders at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the Distribution Date, on the
registry books of the Transfer Agent for the Common Shares. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such
notice of redemption shall state the method by which the payment of the Redemption Price will be made. 


        Section 24.    Notice of Certain Events.    In case the Company shall propose, at any time after the
Distribution Date, (a) to pay any dividend payable in stock of any class to the holders of its Preferred 


24







 



Shares
or to make any other distribution to the holders of its Preferred Shares (other than a regular quarterly cash dividend) or (b) to offer to the holders of its Preferred Shares rights or
warrants to subscribe for or to purchase any additional Preferred Shares or shares of stock of any class or any other securities, rights or options, or (c) to effect any reclassification of its
Preferred Shares (other than a reclassification involving only the subdivision of outstanding Preferred Shares), or (d) to effect any consolidation or merger into or with, or to effect any sale
or other transfer (or to permit one or more of its Subsidiaries to effect any sale or other transfer), in one or more transactions, of 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person, or (e) to effect the liquidation, dissolution or winding up of the Company, or (f) to declare or pay any dividend on any series of
Common Shares payable in Common Shares of the same series or to effect a subdivision, combination or consolidation of any series of Common Shares (by reclassification or otherwise than by payment of
dividends in Common Shares on the Common Shares of the same series), then, in each such case, the Company shall give to each holder of a Right Certificate, in accordance with Section 25 hereof,
a notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, or distribution of rights or warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution, or winding up is to take place and the date of participation therein by the holders of the Common Shares and/or Preferred Shares, if
any such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (a) or (b) above at least 20 days prior to the record date for
determining holders of the Preferred Shares for purposes of such action, and in the case of any such other action, at least 20 days prior to the date of the taking of such proposed action or
the date of participation therein by the holders of the Common Shares and/or Preferred Shares, whichever shall be the earlier. 


        In
case any Triggering Event or Section 13(a) Event shall occur, then, in any such case, (i) the Company shall as soon as practicable thereafter give to each holder of a
Right Certificate, in accordance with Section 25 hereof, a notice of the occurrence of such event, which shall specify the event and the consequences of the event to holders of Rights under
Section 11 or 13 hereof, and (ii) all references in the preceding paragraph to Preferred Shares shall be deemed thereafter to refer to Common Shares and/or, if appropriate, other
securities. 


        Section 25.    Notices.    Notices or demands authorized by this Agreement to be given or made by the Rights
Agent or by the holder of any Right Certificate to or on the Company shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows: 




Genzyme
Corporation

500 Kendall Street

Cambridge, MA 02142

Attention: Chief Legal Officer 


With
a copy to: 


Paul
Kinsella, Esq.

Ropes & Gray LLP

One International Place

Boston, Massachusetts 02110 




25







 





Subject
to the provisions of Section 21 hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the
Rights Agent shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in writing with the Company) as follows: 




Ms. Carolyn
O'Neill

Mr. Carlos Pinto

American Stock Transfer & Trust Company

6201 15th Avenue

Brooklyn, New York 11219 





        Notices
or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate shall be sufficiently given or made if sent
by first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of the Company. 


        Section 26.    Supplements and Amendments.    


        (a)   Prior
to the Distribution Date, the Company and the Rights Agent shall, if the Company so directs, supplement or amend any provision of this Agreement without the
approval of any holders of certificates representing Common Shares. 


        (b)   From
and after the Distribution Date, the Company and the Rights Agent shall, if the Company shall so direct, supplement or amend this Agreement without the approval of
any holders of Right Certificates in order (i) to cure any ambiguity, (ii) to correct or supplement any provision contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to extend the period of redemption provided in Section 23 hereof (which amendment shall set forth a date after which the Rights are no longer redeemable
("Extension Date") unless the Rights are further amended prior to the Extension Date to further extend the time during which the Rights are redeemable,
and which amendment may provide for the termination of the right of redemption prior to any Extension Date), or (iv) to change or supplement the provisions hereunder in any manner which the
Company may deem necessary or desirable and which shall not adversely affect the interests of the holders of Right Certificates (other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person), provided, this Agreement may not be supplemented or amended pursuant to clause (iii) of this sentence after the period for
redemption of the Rights pursuant to Section 23 hereof shall have expired. 


        (c)   Upon
the delivery of a certificate from an appropriate officer of the Company, which states that the proposed supplement or amendment is in compliance with the terms of
this Section 26, the Rights Agent shall execute such supplement or amendment. Notwithstanding anything contained in this Agreement to the contrary, no supplement or amendment shall be made
which changes the redemption price or the number of shares of Common Stock of the Company for which a Right is exercisable. Prior to the Distribution Date, the interests of the holders of Rights shall
be deemed coincident with the interests of the holders of Common Stock. 


        Section 27.    Successors.    All the covenants and provisions of this Agreement by or for the benefit of the
Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns. 


        Section 28.    Determinations and Actions by the Board of Directors.    The Board shall have the exclusive
power and authority to administer this Agreement and to exercise all rights and powers specifically granted to the Board or the Company, or as may be necessary or advisable in the administration of
this Agreement, including, without limitation, the right and power to (i) interpret the provisions of this Agreement and (ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or not redeem the Rights or to 


26







 



amend
the Agreement). All such actions, calculations, interpretations and determinations (including, for purposes of clause (ii) below, all omissions with respect to the foregoing) which are
done or made by the Board in good faith, shall (i) be final, conclusive and binding on the Company, the Rights Agent, the holders of the Right Certificates and all other parties, and
(ii) not subject the Board to any liability to the holders of the Right Certificates. 


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


        Section 30.    Severability.    If any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force
and effect and shall in no way be affected, impaired or invalidated; provided, however, notwithstanding anything in this Agreement to the contrary, if
any such term, provision, covenant or restriction is held by such court or authority to be invalid, void or unenforceable and the Board determines in its good faith judgment that severing the invalid
language from this Agreement would adversely affect the purpose or effect of this Agreement, the right of redemption set forth in Section 23 hereof shall be reinstated and shall not expire
until the close of business on the tenth day following the date of such determination by the Board. 


        Section 31.    Governing Law.    This Agreement and each Right Certificate issued hereunder shall be deemed to
be a contract made under the laws of the Commonwealth of Massachusetts and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be
made and performed entirely within such State. 


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


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


27









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



	[CORPORATE SEAL]	 	GENZYME CORPORATION
	

Attest	
 	

 	
 	

 
	

By:	
 	

/s/  JOANNE M. VASILY-CIOFFI      	
 	

By:	
 	

/s/  PETER WIRTH      
	 	 	
 Name: Joanne M. Vasily-Cioffi

Title: Senior Counsel, Operations	 	 	 	
 Name: Peter Wirth

Title: Executive Vice President and Chief Legal Officer
	

[CORPORATE SEAL]	
 	

AMERICAN STOCK TRANSFER & TRUST COMPANY
	

Attest	
 	

 	
 	

 
	

By:	
 	

/s/  SUSAN SILBER      	
 	

By:	
 	

/s/  HERBERT J. LEMMER      
	 	 	
 Name: Susan Silber

Title: Assistant Secretary	 	 	 	
 Name: Herbert J. Lemmer

Title: Vice President




28








   Exhibit A—TERMS OF THE JUNIOR PARTICIPATING PREFERRED STOCK  


TERMS OF THE

SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

OF GENZYME CORPORATION  


C. DESCRIPTION OF THE PREFERRED STOCK  


        1.    Undesignated Preferred Stock.    Shares of Preferred Stock may be issued from time to time in one or more
series. The Board of Directors may determine, in whole or in part, the number, preferences, limitations or relative rights of any such series before the issuance of any shares of that series. 



        2.    Terms Of The Series A Junior Participating Preferred Stock.    



        (a)    Authorized Amounts and Designations.    Three million (3,000,000) shares of Preferred Stock of the Corporation
are designated as Series A Junior Participating Preferred Stock (the "Series A Preferred Stock" and, together with any other series of Preferred Stock so designated by the Corporation's
Board of Directors, the "Junior Preferred Stock"). To the extent legally permitted, such numbers of shares may be increased or decreased by vote of the Board of Directors,  provided that no decrease
shall reduce the number of shares of Junior Preferred Stock of any series to a number less than the number of shares of such
series then outstanding plus the number of shares of such series reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities
issued by the Corporation convertible into such series of Junior Preferred Stock. 


        (b)    Series A Preferred Stock.    A description of the Series A Preferred Stock and a statement of its
preferences, voting powers, qualifications and special or relative rights or privileges is as follows: 



        (1)    Dividends and Distributions.    



        (A)  Subject
to the prior and superior rights of the holders of any shares of any series of Preferred Stock ranking prior and superior to the Series A Preferred Stock
with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of all shares of Common Stock of the Corporation (the "Common Shares"), shall be
entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of March, June, September
and December in each year (each such date being referred to herein as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share
or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1.00 or (b) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per share amount of all cash dividends, and 100 times the aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions, other than a dividend on shares of Common Stock payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise),
declared on Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Preferred Stock. In the event the Corporation shall, at any time after May 27, 2004, declare or pay any dividend on shares of Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to 




A-1







 





which
holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event. 


        (B)  The
Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in Section IV.C.2(b)(1)(A) immediately after it
declares a dividend or distribution on any shares of Common Stock (other than a dividend payable in shares of Common Stock), provided that, in the event
no dividend or distribution shall have been declared on Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend
of $1.00 per share on the Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date. 


        (C)  Dividends
shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the
date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof. 


        (2)    Voting Rights.    The holders of shares of Series A Preferred Stock shall have the following voting
rights: 


        (A)  Subject
to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to 100 votes on all matters
submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time after May 27, 2004 declare or pay any dividend on any shares of Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were
entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 


        (B)  Except
as otherwise provided herein, in any vote of the Board of Directors of the Corporation creating a series of Preferred Stock, or by law, the holders of shares of
Series A Preferred Stock and the holders of Common Shares and any other capital stock of the Corporation having general voting rights shall vote together as one series on all matters submitted
to a vote of stockholders of the Corporation. 




A-2







 





        (C)  Except
as set forth herein or as otherwise provided by law, holders of Series A Preferred Stock shall have no voting rights. 


        (3)    Liquidation, Dissolution or Winding Up.    Upon any liquidation, dissolution or winding up of the Corporation,
no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock
unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received $100 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment, provided that the holders of shares of Series A Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 100 times the aggregate amount to be distributed per share to holders of shares of Common
Stock, or (2) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except
distributions made ratably on the Series A Preferred Stock and all other such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Corporation shall at any time after May 27, 2004 declare or pay any dividend on shares of Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into
a greater or lesser number of shares of Common Stock, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such
event under the proviso in clause (1) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 


        (4)    Consolidation, Merger, Etc.    In case the Corporation shall enter into any consolidation, merger, combination
or other transaction in which Common Shares are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred
Stock shall at the same time be similarly exchanged or changed into an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Corporation shall
at any time after May 27, 2004 declare or pay any dividend on any shares of Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each
such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction,
the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding
immediately prior to such event. 




        (c)    General Provisions.    Except as otherwise specifically provided in a particular series of Junior Preferred
Stock, the following provisions shall apply to all series of Junior Preferred Stock: 



        (1)    Certain Restrictions.    



        (A)  Whenever
quarterly dividends or other dividends or distributions payable on the Junior Preferred Stock are in arrears, thereafter and until all accrued and unpaid
dividends 




A-3







 





and
distributions, whether or not declared, on shares of Junior Preferred Stock outstanding shall have been paid in full, the Corporation shall not: 



          (i)  declare
or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up)
to the Junior Preferred Stock; 


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



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


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





        (2)   The
Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the
Corporation could, under Section IV.C.2(c)(1)(A) purchase or otherwise acquire such shares at such time and in such manner. 



        (d)    Reacquired Shares.    Any shares of Junior Preferred Stock purchased or otherwise acquired by the Corporation
in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock
and may be reissued as shares of the same series of Preferred Stock or as part of a new series of Preferred Stock, subject to the conditions and restrictions on issuance set forth herein, in
any vote of the Board of Directors of the Corporation creating a series of Preferred Stock, or as otherwise required by law. 



        (e)    Redemption.    The shares of Junior Preferred Stock shall not be redeemable. 


        (f)    Rank.    The Series A Preferred Stock shall rank equally with respect to the payment of dividends and
the distribution of assets together with any other series of the Corporation's Preferred Stock that specifically provide that they shall rank equally with Junior Preferred Stock. The Junior Preferred
Stock shall rank junior with respect to the payment of dividends and the distribution of assets to all series of the Corporation's Preferred Stock that specifically provide that they shall rank prior
to the Junior Preferred Stock. Nothing herein shall preclude the Board from creating any series of Preferred Stock ranking on a parity with or prior to the Junior Preferred Stock as to the payment of
dividends or the distribution of assets. 


        (g)    Amendment.    The Articles of Organization of the Corporation shall not be amended in any manner which would
materially alter or change the powers, preferences or special rights of the 



A-4







 




holders
of Junior Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of each outstanding series of Junior Preferred Stock,
voting together as a single series, provided that, any two or more series of Junior Preferred Stock that are adversely affected in the same manner shall
vote together as a single class. 


        (h)    Fractional Shares.    The Junior Preferred Stock may be issued in fractions of a share which shall entitle the
holder, in proportion to such holder's fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of the
Junior Preferred Stock. 



A-5








   EXHIBIT B—FORM OF RIGHT CERTIFICATE  



	Certificate No GENZ R-	 	Rights






NOT
EXERCISABLE AFTER MARCH 28, 2009 OR EARLIER IF REDEMPTION OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.0005 PER RIGHT, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES (SPECIFIED IN SECTION 7(e) AND 11(b) OF THE RIGHTS AGREEMENT), RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM IS DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER
OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT 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). THIS RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME VOID IN THE CIRCUMSTANCES SPECIFIED IN THE RIGHTS AGREEMENT,
INCLUDING SECTION 7(e) AND SECTION 11(b) THEREOF.]1 






	1
	The
portion of the legend in brackets shall be inserted only if applicable 




Right Certificate

GENZYME CORPORATION  


        This certifies that                        , or registered assigns,
 is the registered owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Fourth Amended and Restated Renewed Rights Agreement, dated as of May 28, 2004 (the "Rights Agreement"), between Genzyme
Corporation, a Massachusetts corporation (the "Company"), and American Stock Transfer & Trust Company (the "Rights Agent"), to purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to 5:00 P.M., Massachusetts time, on March 28, 2009 at the office of the Rights Agent designated for such purposes, or at the
office of its successor as Rights Agent, one two-hundredth of a fully paid non-assessable share of Series A Junior Participating Preferred Stock (the "Preferred Shares")
of the Company, at a purchase price of $150 per one two-hundredth of a Preferred Share (the "Purchase Price"), upon presentation and surrender of this Right Certificate with the Form of
Election to Purchase and related Certificate duly executed. The number of Rights evidenced by this Right Certificate (and the number of one two-hundredths of a Preferred Share which may be
purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number and Purchase Price as
of                        , based on the Preferred Shares as constituted at such
date. 


        Upon
the occurrence of a Triggering Event (as such term is defined in the Rights Agreement), if the Rights evidenced by this Right Certificate are beneficially owned by (i) an
Acquiring Person (as such terms are defined in the Rights Agreement), (ii) a transferee of any such Acquiring Person, Associate or Affiliate, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a person who, after such transfer, became an Acquiring Person, or an Affiliate or Associate of an Acquiring Person, such rights shall become null and
void and no holder hereof shall have any right with respect to such Rights from and after the occurrence of any such Triggering Event. 


        As
provided in the Rights Agreement, the Purchase Price and the number and kind of Preferred Shares or other securities which may be purchased upon the exercise of the Rights evidenced
by this Right Certificate are subject to modification and adjustment upon the happening of certain events. 


B-1







 



        This
Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement are on file at the principal executive offices of the Company and the above-mentioned offices of the
Rights Agent. 


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



        Subject
to the provisions of the Rights Agreement, the Rights evidenced by this Certificate may, but are not required to, be redeemed by the Company at a redemption price of $.0005 per
Right. 


        No
fractional Preferred Shares will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples of one
two-hundredth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), but in lieu thereof a cash payment will be made, as provided in the
Rights Agreement. 


        No
holder of this Right Certificate, as such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Preferred Shares or of any other securities of
the Company which may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right Certificate shall have been exercised as provided in the Rights Agreement. 


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


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



	[CORPORATE SEAL]	 	 	 	 
	

 	
 	

GENZYME CORPORATION
	

ATTEST	
 	

 	
 	

 
	

 	
 	

By:	
 	

 
	
 Clerk	 	 	 	
 Name:

Title:




 




	Countersigned:
	

[                        ]
	

By:	
 	

 
	 	 	
 Authorized Signature




B-2







 

 Form of Reverse Side of Right Certificate  



FORM OF ASSIGNMENT  


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


        FOR
VALUE RECEIVED                          hereby sells, assigns and transfers unto 






(Please print name and address of transferee) 



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



	Dated:                       ,        	 	 
	 	 	
 Signature





Signature Guaranteed: 


        Signatures
must be guaranteed by an Eligible Guarantor Institution, as defined in Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended. 




CERTIFICATE  


        The undersigned hereby certifies by checking the appropriate boxes that: 


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


B-3







 
Form of Reverse Side of Right Certificate—continued  



        (2)   after
due inquiry and to the best knowledge of the undersigned, it [    ] did [    ] did not acquire
the Rights evidenced by this Right Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or Associate of an Acquiring Person. 



	Dated:                       ,        	 	 
	 	 	
 Signature




NOTICE  


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




FORM OF ELECTION TO PURCHASE  


(To
be executed if holder desires to

exercise the Right Certificate.) 


To:
GENZYME CORPORATION 


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


Please
insert social security or other identifying number 


B-4







 





(Please print name and address) 





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


Please
insert social security or other identifying number 







(Please print name and address) 






	Dated:                       ,        	 	 
	 	 	
 Signature
	 	 	(Signature must conform in all respects to name of holder as specified on the face of this Right Certificate in every particular, without alteration or enlargement or any change whatsoever)





Signature Guaranteed: 


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




CERTIFICATE  


        The undersigned hereby certifies by checking the appropriate boxes that: 



        (1)   the
Rights evidenced by this Right Certificate [    ] are [    ] are not being exercised by or on
behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights Agreement); 


        (2)   after
due inquiry and to the best knowledge of the undersigned, it [    ] did [    ] did not acquire
the Rights evidenced by this Right Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or Associate of an Acquiring Person. 



	Dated:                       ,        	 	 
	 	 	
 Signature






NOTICE  


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


        In
the event the Certificates set forth above in the Forms of Assignment and Election are not completed, the Company will deem the beneficial owner of the Rights evidenced by this Right
Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights Agreement) and in the case of an Assignment, will affix a legend to that effect on any Right
Certificates issued in exchange for this Right Certificate. 


B-5











QuickLinks



Exhibit 4.1