<PAGE>





                                                            Exhibit 10(p)
                                                       EXECUTION DRAFT







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                                    ARMCO INC.

                                       and

                                 FIFTH THIRD BANK
                                    Rights Agent


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







                                  Rights Agreement

                             Dated as of February 23, 1996



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<PAGE>

                                  TABLE OF CONTENTS
                                  -----------------

Section                                                                  Page
-------                                                                  ----
1.     Certain Definitions                                                 1

2.     Appointment of Rights Agent                                         6

3.     Issue of Rights Certificates                                        6

4.     Form of Rights Certificates                                         8

5.     Countersignature and Registration                                  10

6.     Transfer, Splitup, Combination and
         Exchange of Rights Certificates;
         Mutilated, Destroyed, Lost or
         Stolen Rights Certificates                                       10

7.     Exercise of Rights; Purchase
         Price; Expiration Date of Rights                                 12

8.     Cancellation and Destruction of
         Rights Certificates                                              14

9.     Reservation and Availability of
         Capital Stock                                                    15

10.    Preferred Stock Record Date                                        17

11.    Adjustment of Purchase Price,
         Number and Kind of Shares or
         Number of Rights                                                 17

12.    Certificate of Adjusted Purchase
          Price or Number of Shares                                       31

13.     Consolidation, Merger or Sale
          or Transfer of Assets or Earning
          Power                                                           31

14.     Fractional Rights and Fractional
          Shares                                                          34

15.     Rights of Action                                                  36

16.     Agreement of Rights Holders                                       36

17.     Rights Certificate Holder Not Deemed
           a Stockholder                                                  37

<PAGE>

18.     Concerning the Rights Agent                                       38

19.     Merger or Consolidation or Change of
           Name of Rights Agent                                           38

20.     Duties of Rights Agent                                            39

21.     Change of Rights Agent                                            42

22.     Issuance of New Rights Certificates                               43

23.     Redemption and Termination                                        44

24.     Notice of Certain Events                                          46

25.     Notices                                                           47

26.     Supplements and Amendments                                        48

27.     Successors                                                        49

28.     Determinations and Actions by
          the Board of Directors, etc.                                    49

29.     Benefits of This Agreement                                        50

30.     Severability                                                      50

31.     Governing Law                                                     50

32.     Counterparts                                                      50

33.     Descriptive Headings                                              51


Exhibit A --             Form of Rights Certificate

Exhibit B --             Form of Summary of Rights

                                       - ii -

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

     RIGHTS AGREEMENT, dated as of February 23, 1996 (the "Agreement"), 
between Armco Inc., an Ohio corporation (the "Company"), and Fifth Third Bank, 
an Ohio banking corporation (the "Rights Agent").


                            W I T N E S S E T H
                            - - - - - - - - - -

     WHEREAS, on February 23, 1996 (the "Rights Dividend Declaration Date"), 
the Board of Directors of the Company authorized and declared a dividend 
distribution of one Right for each share of Common Stock (as hereinafter 
defined) of the Company outstanding at the close of business on June 26, 1996 
(the "Record Date"), and has authorized the issuance of one Right (as such 
number may hereinafter be adjusted pursuant to the provisions of Section 11(o) 
hereof) for each share of Common Stock of the Company issued between the 
Record Date (whether originally issued or delivered from the Company's 
treasury) and the Distribution Date (as hereinafter defined), each Right 
initially representing the right to purchase one two-hundredths of a share of 
Preferred Stock upon the terms and subject to the conditions hereinafter set 
forth (the "Rights");

     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)  "Act" shall mean the Securities Act of 1933.

             (b)  "Adverse Person" shall mean any Person declared to be an 
Adverse Person by the Board of Directors upon determination that the criteria 
set forth in Section 11(a)(ii)(B) apply to such Person.

             (c)  "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") and in effect on the date of this Agreement.

<PAGE>

             (d)  "Acquiring Person" shall mean any Person who or which, 
together with all Affiliates and Associates of such Person, shall be the 
Beneficial Owner of 20% or more of the shares of Common Stock then 
outstanding, but shall not include the Company, any Subsidiary of the Company, 
any employee benefit plan of the Company or of any Subsidiary of the Company, 
or any Person organized, appointed or established by the Company for or 
pursuant to the terms of any such plan.

             (e)  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, directly or indirectly, has 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, warrants or 
options, or otherwise; provided, however, that a Person shall not be deemed 
                       --------
the "Beneficial Owner" of, or to "beneficially own," (A) securities tendered 
pursuant to a tender or exchange offer made by such Person or any of such 
Person's Affiliates or Associates until such tendered securities are accepted 
for purchase or exchange, or (B) securities issuable upon exercise of Rights 
at any time prior to the occurrence of a Triggering Event, or (C) securities 
issuable upon exercise of Rights from and after the occurrence of a Triggering 
Event which Rights were acquired by such Person or any of such Person's 
Affiliates or Associates prior to the Distribution Date or pursuant to 
Section 3(a) or Section 22 hereof (the "Original Rights") or pursuant to 
Section 11(i) hereof in connection with an adjustment made with respect to any 
Original Rights;

                  (ii)  which such Person or any of such Person's Affiliates 
or Associates, directly or indirectly, has the right to vote or dispose of or 
has "beneficial ownership" of (as determined pursuant to Rule 13d-3 of the 
General Rules and Regulations under the Exchange Act as in effect on the date 
of this Agreement), including pursuant to any agreement, arrangement or 
understanding, whether or not in writing; 

                                        - 2 -
<PAGE>

provided, however, that a Person shall not be deemed the "Beneficial Owner" 
of, or to "beneficially own," any security under this subparagraph (ii) as a 
result of an agreement, arrangement or understanding to vote such security if 
such agreement, arrangement or understanding:  (A) arises solely from a 
revocable proxy given in response to a public proxy or consent solicitation 
made pursuant to, and in accordance with, the applicable provisions of the 
General Rules and Regulations under the Exchange Act, and (B) is not also then 
reportable by such Person on Schedule 13D under the Exchange Act (or any 
comparable or successor report); or

                  (iii)  which are beneficially owned, directly or indirectly, 
by any other Person (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 (whether or not in writing), for the purpose of 
acquiring, holding, voting (except pursuant to a revocable proxy as described 
in the proviso to subparagraph (ii) of this paragraph (e)) or disposing of any 
voting securities of the Company; provided, however, that nothing in this 
                                  --------
paragraph (e) shall cause a person engaged in business as an underwriter of 
securities to be the "Beneficial Owner" of, or to "beneficially own," any 
securities acquired through such person's participation in good faith in a 
firm commitment underwriting until the expiration of forty days after the date 
of such acquisition.

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

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

             (h)  "Common Stock" shall mean the common stock, $0.01 par value, 
of the Company, except that "Common Stock" when used with reference to any 
Person other than the Company shall mean the capital stock of such Person with 
the greatest aggregate voting power, or 

                                        - 3 -
<PAGE>

the equity securities or other equity interest having power to control or 
direct the management, of such Person.

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

             (j)  "Continuing Director" shall have the meaning set forth in 
Section 23(a)(i) hereof.

             (k)  "Current market price" shall have the meaning set forth in 
Section 11(d)(i) hereof.

             (l)  "Current Value" shall have the meaning set forth in 
Section 11(a)(iii) hereof.

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

             (n)  "Exchange Act" shall have the meaning set forth in 
Section 1(d) hereof.

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

             (p)  "Final Expiration Date" shall mean the close of business on 
June 26, 2006.

             (q)  "Person" shall mean any individual, firm, corporation, 
partnership, company or other entity.

             (r)  "Preferred Stock" shall mean shares of the Company's Class A 
Preferred Stock, designated as Participating Preferred Stock, without par 
value, and, to the extent that there is not a sufficient number of shares of 
Preferred Stock authorized to permit the full exercise of the Rights, any 
other series of such Preferred Stock of the Company designated for such 
purpose containing terms substantially similar to the terms of the Class A 
Preferred Stock.

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

             (t)  "Purchase Price" shall have the meaning set forth in 
Section 4(a) hereof.

             (u)  "Record Date" shall have the meaning set forth in the 
WHEREAS clause at the beginning of this Agreement.
                                        - 4 -
<PAGE>

             (v)  "Redemption Price" shall have the meaning set forth in 
Section 23(a) hereof.

             (w)  "Rights" shall have the meaning set forth in the WHEREAS 
clause at the beginning of this Agreement.

             (x)  "Rights Certificates" shall have the meaning set forth in 
Section 3(a) hereof.

             (y)  "Section 11(a)(ii) Event" shall mean any event described in 
Section 11(a)(ii)(A) or (B) hereof.

		(z)  "Section 11(a)(ii) Trigger Date" shall have the meaning set 
forth in Section 11(a)(iii) hereof.

             (aa)  "Section 13 Event" shall mean any event described in 
clause (x), (y) or (z) of Section 13(a) hereof.

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

             (cc)  "Stock Acquisition Date" shall mean the first date of a 
public announcement (which, for purposes of this definition, shall include, 
without limitation, a report filed pursuant to Section 13(d) under the 
Exchange Act) by the Company or an Acquiring Person that an Acquiring Person 
has become such.

             (dd)  "Subsidiary" shall mean, with reference to any Person, any 
corporation, partnership, company or other entity of which an amount of voting 
securities sufficient to elect at least a majority of the directors, managers, 
trustees or similar persons, of such entity is beneficially owned, directly or 
indirectly, by such Person, or otherwise controlled by such Person.

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

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

             (gg)  "Triggering Event" shall mean any Section 11(a)(ii) Event 
or any Section 13 Event.

     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 

                                        - 5 -
<PAGE>

accordance with Section 3 hereof, shall prior to the Distribution Date also be 
the holders of the Common Stock) in accordance with the terms and conditions 
hereof, and the Rights Agent hereby accepts such appointment.  The Company may 
from time to time appoint such Co-Rights Agents as it may deem necessary or 
desirable.

     Section 3.  Issue of Rights Certificates.
                 ----------------------------

             (a)  Until the earliest of (i) the close of business on the tenth 
Business Day after the Stock Acquisition Date, (ii) the close of business on 
the tenth Business Day after the date that a tender or exchange offer by 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 Person 
organized, appointed or established by the Company for or pursuant to the 
terms of any such plan) is first published or sent or given within the meaning 
of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act 
as in effect on the date hereof, if upon consummation thereof, such Person 
would be the Beneficial Owner of 20% or more of the shares of Common Stock 
then outstanding or (iii) the close of business on the tenth Business Day 
after the Board of Directors of the Company determines, pursuant to the 
criteria set forth in Section 11(a)(ii)(B) hereof, that a Person is an Adverse 
Person (the earliest of (i), (ii) and (iii) being herein referred to as the 
"Distribution Date"), (x) the Rights will be evidenced (subject to the 
provisions of paragraph (b) of this Section 3) by the certificates for the 
Common Stock registered in the names of the holders of the Common Stock (which 
certificates for Common Stock shall be deemed also to be certificates for 
Rights) and not by separate certificates, and (y) the Rights will be 
transferable only in connection with the transfer of the underlying shares of 
Common Stock (including a transfer to the Company).  As soon as practicable 
after the Distribution Date, upon the wirtten direction of the Company, the 
Rights Agent will send by first-class, insured, postage prepaid mail, to each 
record holder of the 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, one or more rights certificates, in substantially the form of 
Exhibit A hereto (the "Rights Certificates"), evidencing one Right for each 
share of Common Stock so held, subject to adjustment as provided herein.  The 
Company will prepare and execute and the Rights Agent will countersign such 
Rights Certificates 


                                        - 6 -
<PAGE>

as provided in Section 5 hereof.  In the event that an adjustment in the 
number of Rights per share of Common Stock has been made pursuant to 
Section 11(o) 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 Rights Certificates representing 
only whole numbers of Rights are distributed and cash is paid in lieu of any 
fractional Rights.  As of and after the Distribution Date, the Rights will be 
evidenced solely by such Rights Certificates.

             (b)  As promptly as practicable following the Record Date, the 
Company will send a copy of a Summary of Rights to Purchase Preferred Stock, 
in substantially the form attached hereto as Exhibit B, by first-class, 
postage prepaid mail, to each record holder of the Common Stock as of the 
close of business on the Record Date, at the address of such holder shown on 
the records of the Company.  With respect to certificates for the Common Stock 
outstanding as of the Record Date, until the Distribution Date, the Rights 
will be evidenced by such certificates for the Common Stock and the registered 
holders of the Common Stock shall also be the registered holders of the 
associated Rights.  Until the earlier of the Distribution Date or the 
Expiration Date, the transfer of any certificates representing shares of 
Common Stock in respect of which Rights have been issued shall also constitute 
the transfer of the Rights associated with such shares of Common Stock.

             (c)  Rights shall be issued in respect of all shares of Common 
Stock which are issued after the Record Date but prior to the earlier of the 
Distribution Date or the Expiration Date.  Certificates representing such 
shares of Common Stock shall also be deemed to be certificates for Rights, and 
shall bear the following legend:

                   This certificate also evidences and entitles the holder 
hereof to certain Rights as set forth in the Rights Agreement between Armco 
Inc. (the "Company") and Fifth Third Bank (the "Rights Agent") dated as of 
February 23, 1996 (the "Rights Agreement"), the terms of which are hereby 
incorporated herein by reference and a copy of which is on file at the 
principal offices of the Company.  Under certain circumstances, as set 

                                        - 7 -
<PAGE>

forth in the Rights Agreement, such Rights will be evidenced by separate 
certificates and will no longer be evidenced by this certificate.  The Company 
will mail to the holder of this certificate a copy of the Rights Agreement, as 
in effect on the date of mailing, without charge promptly after receipt of a 
written request therefor.  Under certain circumstances set forth in the Rights 
Agreement, Rights issued to, or held by, any Person who is, was or becomes an 
Acquiring Person, an Adverse Person or any Affiliate or Associate thereof (as 
such terms are defined in the Rights Agreement), whether currently held by or 
on behalf of such Person or by any subsequent holder, may become null and 
void.

     With respect to such certificates containing the foregoing legend, until 
the earlier of (i) the Distribution Date or (ii) the Expiration Date, the 
Rights associated with the Common Stock represented by such certificates shall 
be evidenced by such Certificates alone and registered holders of Common Stock 
shall also be the registered holders of the associated Rights, and the 
transfer of any of such certificates shall also constitute the transfer of the 
Rights associated with the Common Stock represented by such certificates.

     Section 4.  Form of Rights Certificates.
                 ---------------------------
             (a)  The Rights Certificates (and the forms of election to 
purchase and of assignment to be printed on the reverse thereof) shall each be 
substantially in the form set forth in Exhibit A hereto and may have such 
marks of identification or designation and such legends, summaries or 
endorsements printed thereon as the Company may deem appropriate and as are 
not inconsistent with the provisions of this Agreement, or as may be required 
to comply with any applicable law or with any rule or regulation made pursuant 
thereto or with any rule or regulation of any stock exchange on which the 
Rights may from time to time be listed, or to conform to usage.  Subject to 
the provisions of Section 11 and Section 22 hereof, the Rights Certificates, 
whenever distributed, shall be dated as of the Record Date and on their face 
shall entitle the holders thereof to purchase such number of one 
two-hundredths of a share of Preferred Stock 

                                        - 8 -
<PAGE>

as shall be set forth therein at the price set forth therein (such exercise 
price per one two-hundredths of a share, the "Purchase Price"), but the amount 
and type of securities purchasable upon the exercise of each Right and the 
Purchase Price thereof shall be subject to adjustment as provided herein.

             (b)  Any Rights Certificate issued pursuant to Section 3(a) or 
Section 22 hereof that represents Rights beneficially owned by any Person 
known to be:  (i) an Acquiring Person, an Adverse Person or any Associate or 
Affiliate of an Acquiring Person or an Adverse Person; (ii) a transferee of an 
Acquiring Person or an Adverse Person (or of any such Associate or Affiliate) 
who becomes a transferee after the Acquiring Person or Adverse Person becomes 
such; or (iii) a transferee of an Acquiring Person or an Adverse Person (or of 
any such Associate or Affiliate) who becomes a transferee prior to or 
concurrently with the Acquiring Person or Adverse Person becoming such and 
receives such Rights pursuant to either (A) a transfer (whether or not for 
consideration) from the Acquiring Person or Adverse Person (or from any such 
Associate or Affiliate) to holders of equity interests in such Acquiring 
Person or Adverse Person (or in any such Associate or Affiliate) or to any 
Person with whom such Acquiring Person or Adverse Person (or any such 
Associate or Affiliate) has any continuing agreement, arrangement or 
understanding regarding the transferred Rights or (B) a transfer which the 
Board of Directors of the Company has determined is part of a plan, 
arrangement or understanding which has as a primary purpose or effect 
avoidance of Section 7(e) hereof, and any Rights Certificate issued pursuant 
to Section 6 or Section 11 hereof upon transfer, exchange, replacement or 
adjustment of any other Rights Certificate referred to in this sentence, shall 
when issued contain (to the extent feasible in the circumstances) the 
following legend, modified as applicable to apply to such Person:

                   The Rights represented by this Rights Certificate are or 
were beneficially owned by a Person who was or became an [Acquiring] [Adverse] 
Person or an Affiliate or Associate of an [Acquiring] [Adverse] Person (as 
such terms are defined in the Rights Agreement).  Accordingly, this Rights 
Certificate and the Rights represented hereby may become null and void in the 

                                        - 9 -
<PAGE>

circumstances specified in Section 7(e) of such Agreement.

     Section 5.  Countersignature and Registration.
                 ---------------------------------
             (a)  The Rights Certificates shall be executed on behalf of the 
Company by its Chairman of the Board, its President or any Vice President, 
either manually or by facsimile signature, and shall have affixed thereto the 
Company's seal or a facsimile thereof which shall be attested by the Secretary 
or an Assistant Secretary of the Company, either manually or by facsimile 
signature.  The Rights Certificates shall be manually countersigned 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 Rights 
Certificates shall cease to be such officer of the Company before 
countersignature by the Rights Agent and issuance and delivery by the Company, 
such Rights 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 Rights Certificates had not ceased to be 
such officer of the Company; and any Rights Certificates may be signed on 
behalf of the Company by any person who, at the actual date of the execution 
of such Rights Certificate, shall be a proper officer of the Company to sign 
such Rights Certificate, although at the date of the execution of this Rights 
Agreement any such person was not such an officer.

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

     Section 6.  Transfer, Splitup, Combination and Exchange of Rights 
                 ------------------------------------------------------ 
Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
----------------------------------------------------------------------

             (a)  Subject to the provisions of Section 4(b), Section 7(e) and 
Section 14 hereof, at any time after the close of business on the Distribution 
Date, and at or prior to the close of business on the Expiration Date, any 
Rights Certificate or Certificates 


                                        - 10 -
<PAGE>

may be transferred, split up, combined or exchanged for another Rights 
Certificate or Certificates, entitling the registered holder to purchase a 
like number of one two-hundredths of a share of Preferred Stock (or, following 
a Triggering Event, Common Stock, other securities, cash or other assets, as 
the case may be) as the Rights Certificate or 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 
Rights Certificate or Certificates shall make such request in writing 
delivered to the Rights Agent, and shall surrender the Rights Certificate or 
Certificates to be transferred, split up, combined or exchanged at the office 
of the Rights Agent designated for such purpose.  Neither the Rights Agent nor 
the Company shall be obligated to take any action whatsoever with respect to 
the transfer of any such surrendered Rights Certificate until the registered 
holder shall have completed and signed the certificate contained in the form 
of assignment on the reverse side of such Rights Certificate and shall have 
provided such additional evidence of the identity of the Beneficial Owner (or 
former Beneficial Owner) or Affiliates or Associates thereof as the Company 
shall reasonably request.  Thereupon the Rights Agent shall, subject to 
Section 4(b), Section 7(e) and Section 14 hereof, countersign and deliver to 
the Person entitled thereto a Rights Certificate or Rights 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, splitup, combination or exchange of Rights 
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 Rights Certificate, and, in case of loss, theft or destruction, of 
indemnity or security reasonably satisfactory to them, and 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 Rights 
Certificate if mutilated, the Company will execute and deliver a new Rights 
Certificate of like tenor to the Rights Agent for countersignature and 
delivery to the registered owner in lieu of the Rights Certificate so lost, 
stolen, destroyed or mutilated.

                                        - 11 -
<PAGE>

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

             (a)  Subject to Section 7(e) hereof, the registered holder of any 
Rights Certificate may exercise the Rights evidenced thereby (except as 
otherwise provided herein including, without limitation, the restrictions on 
exercisability set forth in Section 9(c), Section 11(a)(iii) and Section 23(a) 
hereof) in whole or in part at any time after the Distribution Date upon 
surrender of the Rights Certificate, with the form of election to purchase and 
the certificate on the reverse side thereof duly executed, to the Rights Agent 
at the office of the Rights Agent designated for such purpose, together with 
payment of the aggregate Purchase Price with respect to the total number of 
one two-hundredths of a share of Preferred Stock (or other securities, cash or 
other assets, as the case may be) as to which such surrendered Rights are then 
exercisable, at or prior to the earlier of (i) the Final Expiration Date, or 
(ii) the time at which the Rights are redeemed as provided in Section 23 
hereof (the earlier of (i) and (ii) being herein referred to as the 
"Expiration Date").

             (b)  The Purchase Price for each two-hundredths of a share of 
Preferred Stock pursuant to the exercise of a Right shall initially be $20.00 
and shall be subject to adjustment from time to time as provided in Sections 
11 and 13(a) hereof and shall be payable in accordance with paragraph (c) 
below.

             (c)  Upon receipt of a Rights Certificate representing 
exercisable Rights, with the form of election to purchase and the certificate 
duly executed, accompanied by payment, with respect to each Right so 
exercised, of the Purchase Price per one two-hundredths of a share of 
Preferred Stock (or other shares, securities, cash or other assets, as the 
case may be) to be purchased as set forth below and an amount equal to any 
applicable transfer tax, the Rights Agent shall, subject to Section 20(k) 
hereof thereupon promptly (i)(A) requisition from any transfer agent of the 
shares of Preferred Stock (or make available, if the Rights Agent is the 
transfer agent for such shares) certificates for the total number of one 
two-hundredths of a share of Preferred Stock 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 total number 
of shares of Preferred Stock issuable upon exercise of the Rights 

                                        - 12 -
<PAGE>


hereunder with a depositary agent, requisition from the depositary agent 
depositary receipts representing such number of one two-hundredths of a share 
of Preferred Stock as are to be purchased (in which case certificates for the 
shares of Preferred Stock represented by such receipts shall be deposited by 
the transfer agent with the depositary agent) and the Company will direct the 
depositary agent to comply with such request, (ii) requisition from the 
Company the amount of cash, if any, to be paid in lieu of fractional shares in 
accordance with Section 14 hereof, (iii) 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 Rights Certificate, registered in such name or 
names as may be designated by such holder, and (iv) after receipt thereof, 
deliver such cash, if any, to or upon the order of the registered holder of 
such Rights Certificate.  The payment of the Purchase Price (as such amount 
may be reduced pursuant to Section 11(a)(iii) hereof) may be made in cash or 
by certified bank check or money order payable to the order of the Company.  
In the event that the Company is obligated to issue other securities 
(including Common Stock) of the Company, pay cash and/or distribute other 
property pursuant to Section 11(a) hereof, the Company will make all 
arrangements necessary so that such other securities, cash and/or other 
property are available for distribution by or on behalf of the Rights Agent, 
if and when appropriate.

             (d)  In case the registered holder of any Rights Certificate 
shall exercise less than all the Rights evidenced thereby, a new Rights 
Certificate evidencing Rights equivalent to the Rights remaining unexercised 
shall be issued by the Rights Agent and delivered to, or upon the order of, 
the registered holder of such Rights Certificate, registered in such name or 
names as may be designated by such holder, subject to the provisions of 
Section 14 hereof.

             (e)  Notwithstanding anything in this Agreement to the contrary, 
from and after the first occurrence of a Section 11(a)(ii) Event, any Rights 
beneficially owned by (i) an Acquiring Person, an Adverse Person or an 
Associate or Affiliate of an Acquiring Person or an Adverse Person, (ii) a 
transferee of an Acquiring Person or an Adverse Person (or of any such 
Associate or Affiliate) who becomes a transferee after the Acquiring Person or 
Adverse Person becomes such, or (iii) a transferee of an Acquiring Person or 
an Adverse Person (or of any such Associate or Affiliate) 

                                        - 13 -
<PAGE>

who becomes a transferee prior to or concurrently with the Acquiring Person or 
Adverse Person becoming such and receives such Rights pursuant to either  
transfer (whether or not for consideration) from the Acquiring Person or 
Adverse Person (or from any such Associate or Affiliate) to holders of equity 
interests in such Acquiring Person or Adverse Person (or in any such Associate 
or Affiliate) or to any Person with whom the Acquiring Person or Adverse 
Person (or any such Associate or Affiliate) has any continuing agreement, 
arrangement or understanding regarding the transferred Rights or (B) a 
transfer which the Board of Directors of the Company has determined (whether 
before or after such transfer) 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 no holder of such 
Rights shall have any 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) and 
Section 4(b) hereof are complied with, but shall have no liability to any 
holder of Rights Certificates or other Person as a result of its failure to 
make any determinations with respect to an Acquiring Person or Adverse Person 
or any of their respective 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 Rights 
Certificate surrendered for such exercise, and (ii) provided such additional 
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) 
or Affiliates or Associates thereof as the Company shall reasonably request.

     Section 8.  Cancellation and Destruction of Rights Certificates. 
                 ---------------------------------------------------
All Rights Certificates surrendered for the purpose of exercise, transfer, 
splitup, combination or exchange shall, if surrendered to the Company or any 
of its agents, be delivered to the Rights Agent for cancellation or in 
canceled form, or, if surrendered to the Rights Agent, shall be canceled by 
it, and no Rights Certificates shall be issued in lieu thereof except as 
expressly permitted by any of the 

                                        - 14 -
<PAGE>


provisions of this Agreement.  The Company shall deliver to the Rights Agent 
for cancellation, and the Rights Agent shall so cancel, any other Rights 
Certificate purchased or acquired by the Company otherwise than upon the 
exercise thereof.  The Rights Agent shall deliver all cancelled Rights 
Certificates to the Company, or shall, at the written request of the Company, 
destroy such cancelled Rights Certificates, and in such case shall deliver a 
certificate of destruction thereof to the Company.

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

             (a)  The Company covenants and agrees that it will cause to be 
reserved and kept available out of its authorized and unissued shares of 
Preferred Stock (and, following the occurrence of a Triggering Event, out of 
its authorized and unissued shares of Common Stock and/or other securities or 
out of its authorized and issued shares held in its treasury), the number of 
shares of Preferred Stock (and, following the occurrence of a Triggering 
Event, Common Stock and/or other securities) that, as provided in this 
Agreement, including Section 11(a)(iii) hereof, will be sufficient to permit 
the exercise in full of all outstanding Rights.

             (b)  So long as the shares of Preferred Stock (and, following the 
occurrence of a Triggering Event, Common Stock and/or other securities) 
issuable and deliverable upon the exercise of the Rights may be listed on any 
national securities exchange, the Company shall use its best efforts to cause, 
from and after such time as the Rights become exercisable, all shares reserved 
for such issuance to be listed on such exchange upon official notice of 
issuance upon such exercise.

             (c)  The Company shall use its best efforts to (i) file, as soon 
as practicable following the earliest date after the first occurrence of a 
Section 11(a)(ii) Event on which the consideration to be delivered by the 
Company upon exercise of the Rights has been determined in accordance with 
Section 11(a)(iii) hereof, or as soon as is required by law following the 
Distribution Date, as the case may be, a registration statement under 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 


                                        - 15 -
<PAGE>

the requirements of the Act) until the earlier of (A) the date as of which the 
Rights are no longer exercisable for such securities, and (B) the date of the 
expiration of the Rights.  The Company will also take such action as may be 
appropriate under, or to ensure compliance with, the securities or "blue sky" 
laws of the various states in connection with the exercisability of the 
Rights.  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 the first 
sentence of this Section 9(c), the exercisability of the Rights in order to 
prepare and file such registration statement and permit it to become 
effective.  Upon 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.  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 and until a registration statement has been declared 
effective.

             (d)  The Company covenants and agrees that it will take all such 
action as may be necessary to ensure that all one two-hundredths of a share of 
Preferred Stock (and, following the occurrence of a Triggering Event, Common 
Stock and/or other securities) delivered upon exercise of Rights shall, at the 
time of delivery of the certificates for such shares (subject to payment of 
the Purchase Price), be duly and validly authorized and issued and fully paid 
and nonassessable.

             (e)  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 Rights 
Certificates and of any certificates for a number of one two-hundredths of a 
share of Preferred Stock (or Common Stock and/or other securities, as the case 
may be) 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 Rights Certificates to a Person other than, or the 
issuance or delivery of a number of one two-hundredths of a share of Preferred 
Stock (or Common Stock and/or other securities, as the case may be) in respect 
of a name other than that of, the registered holder of the Rights Certificates 
evidencing Rights surrendered for exercise or to issue or deliver any 
certificates for a 

                                        - 16 -
<PAGE>


number of one two-hundredths of a share of Preferred Stock (or Common Stock 
and/or other securities, as the case may be) in a name other than that of the 
registered holder upon the exercise of any Rights until such tax shall have 
been paid (any such tax being payable by the holder of such Rights 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 Stock Record Date.  Each person in whose name any
                  ---------------------------
certificate for a number of one two-hundredths of a share of Preferred Stock 
(or Common Stock 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 such fractional shares of Preferred Stock (or Common Stock 
and/or other securities, as the case may be) represented thereby on, and such 
certificate shall be dated, the date upon which the Rights Certificate 
evidencing such Rights was duly surrendered and payment of the Purchase Price 
(and all applicable transfer taxes) was made; provided, however, that if the
                                              --------
date of such surrender and payment is a date upon which the Preferred Stock 
(or Common Stock 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 (fractional or otherwise) on, and such 
certificate shall be dated, the next succeeding Business Day on which the 
Preferred Stock (or Common Stock 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 Rights Certificate, as such, shall not be 
entitled to any rights of a stockholder of the Company with respect to shares 
for which the Rights shall be exercisable, including, without limitation, the 
right to vote, to receive dividends or other distributions or to exercise any 
preemptive rights, and shall not be entitled to receive any notice of any 
proceedings of the Company, except as provided herein.

     Section 11.  Adjustment of Purchase Price, Number and Kind of Shares or
                  -----------------------------------------------------------
Number of Rights.  The Purchase Price, the number and kind of shares covered 
----------------
by each Right and the number of Rights outstanding are subject to adjustment 
from time to time as provided in this Section 11.

             (a)(i)  In the event the Company shall at any time after the date 
of this Agreement (A) declare a dividend on the Preferred Stock payable in 
shares of 

                                        - 17 -
<PAGE>

Preferred Stock, (B) subdivide the outstanding Preferred Stock, (C) combine 
the outstanding Preferred Stock into a smaller number of shares, or (D) issue 
any shares of its capital stock in a reclassification of the Preferred Stock 
(including any such reclassification in connection with a consolidation or 
merger in which the Company is the continuing or surviving corporation), 
except as otherwise provided in this Section 11(a) and Section 7(e) hereof, 
the Purchase Price in effect at the time of the record date for such dividend 
or of the effective date of such subdivision, combination or reclassification, 
and the number and kind of shares of Preferred Stock or capital stock, as the 
case may be, issuable on such date, shall be proportionately adjusted so that 
the holder of any Right exercised after such time shall be entitled to 
receive, upon payment of the Purchase Price then in effect, the aggregate 
number and kind of shares of Preferred Stock or capital stock, as the case may 
be, which, if such Right had been exercised immediately prior to such date and 
at a time when the Preferred Stock transfer books of the Company were open, he 
would have owned upon such exercise and been entitled to receive by virtue of 
such dividend, subdivision, combination or reclassification.  If an event 
occurs which would require an adjustment under both this Section 11(a)(i) and 
Section 11(a)(ii) hereof, the adjustment provided for in this Section 11(a)(i) 
shall be in addition to, and shall be made prior to, any adjustment required 
pursuant to Section 11(a)(ii) hereof.

                       (ii)  In the event:

             (A)  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 Person organized, appointed or established by the Company for 
or pursuant to the terms of any such plan), alone or together with its 
Affiliates and Associates, shall, at any time after the Rights Dividend 
Declaration Date, become the Beneficial Owner of 25% or more of the shares of 
Common Stock then outstanding, unless the event causing the 25% threshold to 
be crossed is a transaction set forth in Section 13(a) hereof or

             (B)  subject to the requirements of this Section 11(a)(ii), the 
Board of Directors of the Company shall declare any Person to be an Adverse 
Person, upon (x) a determination that such 


                                        - 18 -
<PAGE>

Person, alone or together with its Affiliates and Associates, has or will, at 
any time after the Rights Dividend Declaration Date, become the Beneficial 
Owner of 10% or more of the outstanding shares of Common Stock (provided that 
any such determination may not be effective until such Person has become the 
Beneficial Owner of 10% or more of the outstanding shares of Common Stock) and 
(y) a determination by at least a majority of the Continuing Directors, after 
reasonable inquiry and investigation, including consultation with such persons 
as such directors shall deem appropriate, that (a) such Beneficial Ownership 
by such Person is intended to cause, is reasonably likely to cause or will 
cause the Company to repurchase the Common Stock beneficially owned by such 
Person or to cause pressure on the Company to take action or enter into a 
transaction or series of transactions which would provide such Person with 
short-term financial gain under circumstances where the Board of Directors 
determines that the best longterm interests of the Company and its 
stockholders, but for the actions and possible actions of such Person, would 
not be served by taking such action or entering into such transactions or 
series of transactions at that time or (b) such Beneficial Ownership is 
causing or reasonably likely to cause a material adverse impact (including, 
but not limited to, impairment of relationships with customers or impairment 
of the Company's ability to maintain its competitive position) on the business 
or prospects of the Company, or (c) such beneficial ownership otherwise is 
determined to be not in the best interests of the Company and its 
stockholders, employees, customers and communities in which the Company and 
its Subsidiaries do business,

then, promptly following the first occurrence of a Section 11(a)(ii) Event, 
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 the right to 
receive, upon exercise thereof at the thencurrent Purchase Price in accordance 
with the terms of this Agreement, in lieu of a number of one two-hundredths of 
a share of Preferred Stock, such number of shares of Common Stock of the 
Company as shall equal the result obtained by (x) multiplying the then-current 
Purchase Price by the then-number of one two-hundredths of a share of 
Preferred Stock for which a 

                                        - 19 -
<PAGE>


Right was exercisable immediately prior to the first occurrence of a 
Section 11(a)(ii) Event, and (y) dividing that product (which, following such 
first occurrence, shall thereafter be referred to as the "Purchase Price" for 
each Right and for all purposes of this Agreement) by 50% of the current 
market price (determined pursuant to Section 11(d) hereof) per share of Common 
Stock on the date of such first occurrence (such number of shares, the 
"Adjustment Shares").  Notwithstanding the provisions of Section 11(a)(ii)(B) 
hereof, the Board of Directors of the Company may not declare a Person to be 
an Adverse Person if, prior to the time that such Person acquired 10% or more 
of the shares of Common Stock then outstanding, such Person provided to the 
Board of Directors in writing a statement of such Person's purpose and 
intentions in connection with the proposed acquisition of Common Stock, 
together with any other information reasonably requested of such Person by the 
Board of Directors, and the Board of Directors, based on such statement and 
reasonable inquiry and investigation, including consultation with such Persons 
as such directors shall deem appropriate, determines to notify and notifies 
such Person in writing that it will not declare such Person to be an Adverse 
Person; provided, however, that the Board of Directors
        --------  -------
may expressly condition in any manner a determination not to declare a Person 
an Adverse Person on such conditions as the Board of Directors may select, 
including, without limitation, such Person's not acquiring more than a 
specified amount of Common Stock and/or on such Person's not taking actions 
inconsistent with the purposes and intentions disclosed by such Person in the 
statement provided to the Board of Directors.  In the event that the Board of 
Directors should at any time determine, upon reasonable inquiry and 
investigation, including consultation with such Persons as such directors 
shall deem appropriate, that such Person has not met or complied with any 
condition specified by the Board of Directors pursuant to the preceding 
sentence, the Board of Directors may at any time thereafter declare such 
Person to be an Adverse Person pursuant to the provisions of this 
Section 11(a)(ii).

                       (iii)  In the event that the number of shares of Common 
Stock which are authorized by the Company's Articles of Incorporation but not 
outstanding or reserved for issuance for purposes other than upon exercise of 
the Rights are not sufficient to permit the exercise in full of the Rights in 
accordance with the foregoing subparagraph (ii) of this Section 11(a), the 

                                        - 20 -
<PAGE>


Company shall:  (A) determine the excess of (1) the value of the Adjustment 
Shares issuable upon the exercise of a Right (the "Current Value") over (2) 
the Purchase Price (such excess, the "Spread"), and (B) with respect to each 
Right, make adequate provision to substitute for the Adjustment Shares, upon 
payment of the applicable Purchase Price, (1) cash, (2) a reduction in the 
Purchase Price, (3) Common Stock or other equity securities of the Company 
(including, without limitation, shares, or units of shares, of preferred stock 
which the Board of Directors of the Company has deemed to have the same value 
as shares of Common Stock (such shares of preferred stock, "common stock 
equivalents")), (4) debt securities of the Company, (5) other assets, or (6) 
any combination of the foregoing, having an aggregate value equal to the 
Current Value, where such aggregate value has been determined by the Board of 
Directors of the Company based upon the advice of one or more investment or 
financial advisors selected by the Board of Directors of the Company; 
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 later of (x) the first occurrence of a Section 11(a)(ii) Event and (y) the 
date on which the Company's right of redemption pursuant to Section 23(a) 
expires (the later of (x) and (y) being referred to herein as the 
"Section 11(a)(ii) Trigger Date"), then the Company shall be obligated to 
deliver, upon the surrender for exercise of a Right and without requiring 
payment of the Purchase Price, shares of Common Stock (to the extent 
available) and then, if necessary, cash, which shares and/or cash have an 
aggregate value equal to the Spread.  If the Board of Directors of the Company 
shall determine in good faith that it is likely that sufficient additional 
shares of Common Stock could be authorized for issuance upon exercise in full 
of the Rights, the thirty (30) day period set forth above may be extended to 
the extent necessary, but not more than ninety (90) days after the 
Section 11(a)(ii) Trigger Date, in order that the Company may seek stockholder 
approval for the authorization of such additional shares (such period, as it 
may be extended, the "Substitution Period").  To the extent that the Company 
determines that some action need be taken pursuant to the first and/or second 
sentences of this Section 11(a)(iii), the Company (x) shall provide, subject 
to 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 

                                        - 21 -
<PAGE>


of additional shares and/or to decide the appropriate form of distribution to 
be made pursuant to such first sentence and to determine the value thereof.  
In the event of any such suspension, the Company shall issue a public 
announcement stating that the exercisability of the Rights has been 
temporarily suspended, as well as a public announcement at such time as the 
suspension is no longer in effect.  For purposes of this Section 11(a)(iii), 
the value of the Common Stock shall be the current market price (as determined 
pursuant to Section 11(d) hereof) per share of the Common Stock on the 
Section 11(a)(ii) Trigger Date and the value of any "common stock equivalent" 
shall be deemed to have the same value as the Common Stock on such date.

                       (iv)  In lieu of issuing shares of Common Stock in 
accordance with subparagraph (ii) of this Section 11(a), the Company may with 
respect to each Right, if a majority of members of the Board of Directors and 
a majority of the Continuing Directors determine that such action is in the 
best interests of the Company and not contrary to the interests of the holders 
of Rights, make adequate provision to substitute for the Adjustment Shares, 
(x) upon the surrender for exercise of a Right and payment of the applicable 
Purchase Price, (1) cash, (2) a reduction in Purchase Price, (3) Common Stock, 
or other equity securities of the Company (including without limitation common 
stock equivalents), (4) debt securities of the Company, (5) other assets or 
(6) any combination of the foregoing having an aggregate value equal to the 
Adjustment Value where such aggregate value has been determined by the Board 
of Directors of the Company based upon the advice of one or more investment or 
financial advisers selected by the Board of Directors of the Company or (y) 
upon the surrender for exercise of a Right and without requiring payment of 
the Purchase Price, (1) cash, (2) Common Stock or other equity securities of 
the Company (including, without limitation, common stock equivalents), (3) 
debt securities of the Company, (4) other assets or (5) any combination of the 
foregoing, having an aggregate value equal to the Spread where such aggregate 
value has been determined by the Board of Directors of the Company based upon 
the advice of one or more investment or financial advisors selected by the 
Board of Directors of the Company.

             (b)  In case the Company shall fix a record date for the issuance 
of rights, options or warrants to all holders of Preferred Stock entitling 
them to subscribe for or purchase (for a period expiring within 

                                        - 22 -
<PAGE>

forty-five (45) calendar days after such record date) Preferred Stock (or 
shares having the same rights, privileges and preferences as the shares of 
Preferred Stock ("equivalent preferred stock")) or securities convertible into 
Preferred Stock or equivalent preferred stock at a price per share of 
Preferred Stock or per share of equivalent preferred stock (or having a 
conversion price per share, if a security convertible into Preferred Stock or 
equivalent preferred stock) less than the current market price (as determined 
pursuant to Section 11(d) hereof) per share of Preferred Stock on such record 
date, the Purchase Price to be in effect after such record date shall be 
determined by multiplying the Purchase Price in effect immediately prior to 
such record date by a fraction, the numerator of which shall be the number of 
shares of Preferred Stock outstanding on such record date, plus the number of 
shares of Preferred Stock which the aggregate offering price of the total 
number of shares of Preferred Stock and/or equivalent preferred stock so to be 
offered (and/or the aggregate initial conversion price of the convertible 
securities so to be offered) would purchase at such current market price, and 
the denominator of which shall be the number of shares of Preferred Stock 
outstanding on such record date, plus the number of additional shares of 
Preferred Stock and/or equivalent preferred stock to be offered for 
subscription or purchase (or into which the convertible securities so to be 
offered are initially convertible).  In case such subscription price may be 
paid by delivery of consideration part or all of which may be in a form other 
than cash, the value of such consideration shall be as determined in good 
faith by the Board of Directors of the Company, whose determination shall be 
described in a statement filed with the Rights Agent and shall be binding on 
the Rights Agent and the holders of the Rights.  Shares of Preferred Stock 
owned by or held for the account of the Company shall not be deemed 
outstanding for the purpose of any such computation.  Such adjustment shall be 
made successively whenever such a record date is fixed, and in the event that 
such rights or warrants are not so issued, the Purchase Price shall be 
adjusted to be the Purchase Price which would then be in effect if such record 
date had not been fixed.

             (c)  In case the Company shall fix a record date for a 
distribution to all holders of Preferred Stock (including any such 
distribution made in connection with a consolidation or merger in which the 
Company is the continuing corporation) of evidences of 

                                        - 23 -
<PAGE>


indebtedness, cash (other than a regular quarterly cash dividend out of the 
earnings or retained earnings of the Company), assets (other than a dividend 
payable in Preferred Stock, but including any dividend payable in stock other 
than Preferred Stock) or subscription rights or warrants (excluding those 
referred to in Section 11(b) hereof), the Purchase Price to be in effect after 
such record date shall be determined by multiplying the Purchase Price in 
effect immediately prior to such record date by a fraction, the numerator of 
which shall be the current market price (as determined pursuant to 
Section 11(d) hereof) per share of Preferred Stock on such record date, less 
the fair market value (as determined in good faith by the Board of Directors 
of the Company, whose determination shall be described in a statement filed 
with the Rights Agent) of the portion of the cash, assets or evidences of 
indebtedness so to be distributed or of such subscription rights or warrants 
applicable to a share of Preferred Stock and the denominator of which shall be 
such current market price (as determined pursuant to Section 11(d) hereof) per 
share of Preferred Stock.  Such adjustments shall be made successively 
whenever such a record date is fixed, and in the event that such distribution 
is not so made, the Purchase Price shall be adjusted to be the Purchase Price 
which would have been in effect if such record date had not been fixed.

             (d)(i)  For the purpose of any computation hereunder, other than 
computations made pursuant to Section 11(a)(iii) and Section 11(a)(iv) hereof, 
the "current market price" per share of Common Stock on any date shall be 
deemed to be the average of the daily closing prices per share of such Common 
Stock for the thirty (30) consecutive Trading Days (as such term is 
hereinafter defined) immediately prior to such date, and for purposes of 
computations made pursuant to Section 11(a)(iii) and Section 11(a)(iv) hereof, 
the "current market price" per share of Common Stock on any date shall be 
deemed to be the average of the daily closing prices per share of such Common 
Stock for the ten (10) consecutive Trading Days immediately following such 
date; provided, however, that in the event that the current market price per
      --------
share of the Common Stock is determined during a period following the 
announcement by the issuer of such Common Stock of (A) a dividend or 
distribution on such Common Stock payable in shares of such Common Stock or 
securities convertible into shares of such Common Stock (other than the 
Rights), or (B) any subdivision, combination or reclassification of such 
Common Stock, and prior to the expiration of the 

                                        - 24 -
<PAGE>


requisite thirty (30) Trading Day or ten (10) Trading Day period, as set forth 
above, after the ex-dividend date for such dividend or distribution, or the 
record date for such subdivision, combination or reclassification, then, and 
in each such case, the "current market price" shall be properly adjusted to 
take into account ex-dividend trading.  The closing price for each day shall 
be the last sale price, regular way, or, in case no such sale takes place on 
such day, the average of the closing bid and asked prices, regular way, in 
either case as reported in the principal consolidated transaction reporting 
system with respect to securities listed or admitted to trading on the New 
York Stock Exchange or, if the shares of Common Stock are not listed or 
admitted to trading on the New York Stock Exchange, as reported in the 
principal consolidated transaction reporting system with respect to securities 
listed on the principal national securities exchange on which the shares of 
Common Stock are listed or admitted to trading or, if the shares of Common 
Stock are not listed or admitted to trading on any national securities 
exchange, the last quoted price or, if not so quoted, the average of the high 
bid and low asked prices in the over-the-counter market, as reported by the 
National Association of Securities Dealers, Inc. Automated Quotation System 
("NASDAQ") or such other system then in use, or, if on any such date the 
shares of Common Stock are not quoted by any such organization, the average of 
the closing bid and asked prices as furnished by a professional market maker 
making a market in the Common Stock selected by the Board of Directors of the 
Company.  If on any such date no market maker is making a market in the Common 
Stock, the fair value of such shares on such date as determined in good faith 
by the Board of Directors of the Company shall be used.  The term "Trading 
Day" shall mean a day on which the principal national securities exchange on 
which the shares of Common Stock are listed or admitted to trading is open for 
the transaction of business or, if the shares of Common Stock are not listed 
or admitted to trading on any national securities exchange, a Business Day.  
If the Common Stock is not publicly held or not so listed or traded, "current 
market price" per share shall mean the fair value per share as determined in 
good faith by the Board of Directors of the Company, 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 market price" per share of 

                                        - 25 -
<PAGE>

Preferred Stock shall be determined in the same manner as set forth above for 
the Common Stock in clause (i) of this Section 11(d) (other than the last 
sentence thereof).  If the current market price per share of Preferred Stock 
cannot be determined in the manner provided above or if the Preferred Stock is 
not publicly held or listed or traded in a manner described in clause (i) of 
this Section 11(d), the "current market price" per share of Preferred Stock 
shall be conclusively deemed to be an amount equal to 200 (as such number may 
be appropriately adjusted for such events as stock splits, stock dividends and 
recapitalizations with respect to the Common Stock occurring after the date of 
this Agreement) multiplied by the current market price per share of the Common 
Stock.  If neither the Common Stock nor the Preferred Stock is publicly held 
or so listed or traded, "current market price" per share of the Preferred 
Stock shall mean the fair value per share as determined in good faith by the 
Board of Directors of the Company, whose determination shall be described in a 
statement filed with the Rights Agent and shall be conclusive for all 
purposes.  For all purposes of this Agreement, the "current market price" of 
one two-hundredth of a share of Preferred Stock shall be equal to the "current 
market price" of one share of Preferred Stock divided by 200.

             (e)  Anything herein to the contrary notwithstanding, no 
adjustment in the Purchase Price shall be required unless such adjustment 
would require an increase or decrease of at least one percent (1%) in the 
Purchase Price; provided, however, that any adjustments which by reason of
                --------
this Section 11(e) are not required to be made shall be carried forward and 
taken into account in any subsequent adjustment.  All calculations under this 
Section 11 shall be made to the nearest cent or to the nearest ten-thousandth 
of a share of Common Stock or other share or one-millionth of a share of 
Preferred Stock, as the case may be.  Notwithstanding the first sentence of 
this Section 11(e), any adjustment required by this Section 11 shall be made 
no later than the earlier of (i) three (3) years from the date of the 
transaction which mandates such adjustment, or (ii) the Expiration Date.

             (f)  If as a result of an adjustment made pursuant to 
Section 11(a)(ii) or Section 13(a) hereof, the holder of any Right thereafter 
exercised shall become entitled to receive any shares of capital stock other 
than Preferred Stock, thereafter the number of 

                                        - 26 -
<PAGE>


such other shares so receivable upon exercise of any Right and the Purchase 
Price thereof shall be subject to adjustment from time to time in a manner and 
on terms as nearly equivalent as practicable to the provisions with respect to 
the Preferred Stock contained in Sections 11(a), (b), (c), (e), (g), (h), (i), 
(j) and (l), and the provisions of Sections 7, 9, 10, 13 and 14 hereof with 
respect to the Preferred Stock shall apply on like terms to any such other 
shares.

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

             (h)  Unless the Company shall have exercised its election as 
provided in Section 11(i), upon each adjustment of the Purchase Price as a 
result of the calculations made in Sections 11(b) and (c), each Right 
outstanding immediately prior to the making of such adjustment shall 
thereafter evidence the right to purchase, at the adjusted Purchase Price, 
that number of one two-hundredths of a share of Preferred Stock (calculated to 
the nearest one-millionth) obtained by (i) multiplying (x) the number of one 
two-hundredths of a share covered by a Right immediately prior to this 
adjustment, by (y) the Purchase Price in effect immediately prior to such 
adjustment of the Purchase Price, and (ii) dividing the product so obtained by 
the Purchase Price in effect immediately after such adjustment of the Purchase 
Price.

             (i)  The Company may elect on or after the date of any adjustment 
of the Purchase Price to adjust the number of Rights, in lieu of any 
adjustment in the number of one two-hundredths of a share of Preferred Stock 
purchasable upon the exercise of a Right.  Each of the Rights outstanding 
after the adjustment in the number of Rights shall be exercisable for the 
number of one two-hundredths of a share of Preferred Stock for which a Right 
was exercisable immediately prior to such adjustment.  Each Right held of 
record prior to such adjustment of the number of Rights shall become that 
number of Rights (calculated to the nearest one tenthousandth) obtained by 
dividing the Purchase Price in effect immediately prior to adjustment of the 
Purchase Price by the Purchase Price in effect immediately after 

                                        - 27 -
<PAGE>


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 Rights Certificates have 
been issued, shall be at least ten (10) days later than the date of the public 
announcement.  If Rights Certificates have been issued, upon each adjustment 
of the number of Rights pursuant to this Section 11(i), the Company shall, as 
promptly as practicable, cause to be distributed to holders of record of 
Rights Certificates on such record date Rights 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 Rights Certificates held by such holders 
prior to the date of adjustment, and upon surrender thereof, if required by 
the Company, new Rights Certificates evidencing all the Rights to which such 
holders shall be entitled after such adjustment.  Rights Certificates so to be 
distributed shall be issued, executed and countersigned in the manner provided 
for herein (and may bear, at the option of the Company, the adjusted Purchase 
Price) and shall be registered in the names of the holders of record of Rights 
Certificates on the record date specified in the public announcement.

             (j)  Irrespective of any adjustment or change in the Purchase 
Price or the number of one two-hundredths of a share of Preferred Stock 
issuable upon the exercise of the Rights, the Rights Certificates theretofore 
and thereafter issued may continue to express the Purchase Price per one 
two-hundredth of a share and the number of one two-hundredths of a share which 
were expressed in the initial Rights Certificates issued hereunder.

             (k)  In any case in which this Section 11 shall require that an 
adjustment in the Purchase Price be made effective as of a record date for a 
specified event, the Company may elect to defer until the occurrence of such 
event the issuance to the holder of any Right exercised after such record date 
the number of one two-hundredths of a share of Preferred 

                                        - 28 -
<PAGE>


Stock and other capital stock or securities of the Company, if any, issuable 
upon such exercise over and above the number of one two-hundredths of a share 
of Preferred Stock and other capital stock or securities of the Company, if 
any, issuable upon such exercise on the basis of the Purchase Price in effect 
prior to such adjustment; provided, however, that the Company shall deliver to
                          --------
such holder a due bill or other appropriate instrument evidencing such 
holder's right to receive such additional shares (fractional or otherwise) or 
securities upon the occurrence of the event requiring such adjustment.

             (l)  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 in their good faith judgment the Board of Directors of the 
Company shall determine to be advisable in order that any (i) consolidation or 
subdivision of the Preferred Stock, (ii) issuance wholly for cash of any 
shares of Preferred Stock at less than the current market price, 
(iii) issuance wholly for cash of shares of Preferred Stock or securities 
which by their terms are convertible into or exchangeable for shares of 
Preferred Stock, (iv) stock dividends or (v) issuance of rights, options or 
warrants referred to in this Section 11, hereafter made by the Company to 
holders of its Preferred Stock shall not be taxable to such stockholders.

             (m)  The Company covenants and agrees that it shall not, at any 
time after the Distribution Date, (i) consolidate with any other Person (other 
than a Subsidiary of the Company in a transaction which complies with 
Section 11(n) hereof), (ii) merge with or into any other Person (other than a 
Subsidiary of the Company in a transaction which complies with Section 11(n) 
hereof), or (iii) sell or transfer (or permit any Subsidiary to sell or 
transfer), in one transaction, or a series of related transactions, assets or 
earning power aggregating more than 50% of the assets or earning power of the 
Company and its Subsidiaries (taken as a whole) to any other Person or Persons 
(other than the Company and/or any of its Subsidiaries in one or more 
transactions each of which complies with Section 11(n) hereof), if (x) at the 
time of or immediately after such consolidation, merger, sale or transfer 
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 or (y) prior to, 
simultaneously with or immediately after such consolidation, merger, sale or 

                                        - 29 -
<PAGE>

transfer, the stockholders of the Person who constitutes, or would constitute, 
the "Principal Party" for purposes of Section 13(a) hereof shall have received 
a distribution of Rights previously owned by such Person or any of its 
Affiliates and Associates.

             (n)  The Company covenants and agrees that, after the 
Distribution Date, it will not, except as permitted by Section 23 or 
Section 26 hereof, take (or permit any Subsidiary to take) any action if at 
the time such action is taken it is reasonably foreseeable that such action 
will diminish substantially or otherwise eliminate the benefits intended to be 
afforded by the Rights.

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

     Section 12.  Certificate of Adjusted Purchase Price or Number of Shares. 
                  ----------------------------------------------------------
Whenever an adjustment is made as provided in Section 11 and Section 13 
hereof, the Company shall (a) promptly prepare a certificate setting forth 
such adjustment and a brief statement of the facts accounting for such 
adjustment, (b) promptly file with the Rights Agent, and with each transfer 
agent for the Preferred Stock and the Common Stock, a copy of such 
certificate, and (c) mail a brief summary thereof to each holder of a Rights 
Certificate (or, if prior to the Distribution Date, to each holder of a 
certificate representing shares of Common Stock) in accordance with Section 25 
hereof.  The Rights Agent shall be fully 

                                        - 30 -
<PAGE>

protected in relying on any such certificate and on any adjustment therein 
contained and shall not be deemed to have knowledge of such adjustment unless 
and until it shall have received such certificate.

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

             (a)  In the event that, following the Stock Acquisition Date, 
directly or indirectly, (x) the Company shall consolidate with, or merge with 
and into, any other Person (other than a Subsidiary of the Company in a 
transaction which complies with Section 11(n) hereof), and the Company shall 
not be the continuing or surviving corporation of such consolidation or 
merger, (y) any Person (other than a Subsidiary of the Company in a 
transaction which complies with Section 11(n) hereof) shall consolidate with, 
or merge with or into, the Company, and the Company shall be the continuing or 
surviving corporation of such consolidation or merger and, in connection with 
such consolidation or merger, all or part of the outstanding shares of Common 
Stock shall be changed into or exchanged for stock or other securities of any 
other Person or cash or any other property, or (z) the Company shall sell or 
otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise 
transfer), in one transaction or a series of related transactions, assets or 
earning power aggregating more than 50% of the assets or earning power of the 
Company and its Subsidiaries (taken as a whole) to any Person or Persons 
(other than the Company or any Subsidiary of the Company in one or more 
transactions each of which complies with Section 11(n) hereof), then, and in 
each such case, proper provision shall be made so that:  (i) each holder of a 
Right, except holders described in Section 7(e) hereof, shall thereafter have 
the right to receive, upon the exercise thereof at the then-current Purchase 
Price in accordance with the terms of this Agreement, such number of validly 
authorized and issued, fully paid, nonassessable and freely tradeable shares 
of Common Stock of the Principal Party (as such term is hereinafter defined), 
not subject to any liens, encumbrances, rights of first refusal or other 
adverse claims, as shall be equal to the result obtained by (1) multiplying 
the then-current Purchase Price by the number of one two-hundredths of a share 
of Preferred Stock for which a Right is exercisable immediately prior to the 
first occurrence of a Section 13 Event (or, if a Section 11(a)(ii) Event has 
occurred prior to the first occurrence of a Section 13 Event, multiplying the 
number of such one two-hundredths of a share of Preferred Stock 


                                        - 31 -
<PAGE>

for which a Right was exercisable immediately prior to the first occurrence of 
a Section 11(a)(ii) Event by the Purchase Price in effect immediately prior to 
such first occurrence), and dividing that product (which, following the first 
occurrence of a Section 13 Event, shall be referred to as the "Purchase Price" 
for each Right and for all purposes of this Agreement) by (2) 50% of the 
current market price (determined pursuant to Section 11(d)(i) hereof) per 
share of the Common Stock of such Principal Party on the date of consummation 
of such Section 13 Event; (ii) such Principal Party shall thereafter be liable 
for, and shall assume, by virtue of such Section 13 Event, all the obligations 
and duties of the Company pursuant to this Agreement; (iii) the term "Company" 
shall thereafter be deemed to refer to such Principal Party, it being 
specifically intended that the provisions of Section 11 hereof shall apply 
only to such Principal Party following the first occurrence of a Section 13 
Event; (iv) such Principal Party shall take such steps (including, but not 
limited to, the reservation of a sufficient number of shares of its Common 
Stock) in connection with the consummation of any such transaction as may be 
necessary to assure that the provisions hereof shall thereafter be applicable, 
as nearly as reasonably may be, in relation to its shares of Common Stock 
thereafter deliverable upon the exercise of the Rights; and (v) the provisions 
of Section 11(a)(ii) hereof shall be of no effect following the first 
occurrence of any Section 13 Event.

             (b)  "Principal Party" shall mean

                   (i)  in the case of any transaction described in clause (x) 
or (y) of the first sentence of Section 13(a), the Person that is the issuer 
of any securities into which shares of Common Stock 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 
(z) of the first sentence of Section 13(a), the Person that is the party 
receiving the greatest portion of the assets or earning power transferred 
pursuant to such transaction or transactions;

provided, however, that in any such case, (1) if the Common Stock of such 
--------
Person is not at such time and has not been continuously over the preceding 
twelve (12) 


                                        - 32 -
<PAGE>

month period registered under Section 12 of the Exchange Act, and such Person 
is a direct or indirect Subsidiary of another Person the Common Stock of which 
is and has been so registered, "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 Stocks 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 Stock 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 shares of its Common Stock 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, sale or transfer 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 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 a Section 13 
Event shall occur at any time after the occurrence of a Section 11(a)(ii) 
Event, the Rights which have not theretofore been exercised shall thereafter 
become exercisable in the manner described in Section 13(a).

                                        - 33 -
<PAGE>


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

             (b)  The Company shall not be required to issue fractions of 
shares of Preferred Stock (other than fractions which are integral multiples 
of one two-hundredth of a share of Preferred Stock) upon exercise of the 
Rights or to distribute certificates which evidence fractional shares of 
Preferred Stock (other than fractions which are integral multiples of 

                                        - 34 -
<PAGE>


one two-hundredths of a share of Preferred Stock).  In lieu of fractional 
shares of Preferred Stock that are not integral multiples of one two-
hundredths of a share of Preferred Stock, the Company may pay to the 
registered holders of Rights Certificates at the time such Rights are 
exercised as herein provided an amount in cash equal to the same fraction of 
the current market value of one two-hundredths of a share of Preferred Stock.  
For purposes of this Section 14(b), the current market value of one 
two-hundredths of a share of Preferred Stock shall be one two-hundredths of 
the closing price of a share of Preferred Stock (as determined pursuant to 
Section 11(d)(ii) hereof) for the Trading Day immediately prior to the date of 
such exercise.

             (c)  Following the occurrence of a Triggering Event, the Company 
shall not be required to issue fractions of shares of Common Stock upon 
exercise of the Rights or to distribute certificates which evidence fractional 
shares of Common Stock.  In lieu of fractional shares of Common Stock, the 
Company may pay to the registered holders of Rights Certificates at the time 
such Rights are exercised as herein provided an amount in cash equal to the 
same fraction of the current market value of one (1) share of Common Stock.  
For purposes of this Section 14(c), the current market value of one share of 
Common Stock shall be the closing price of one share of Common Stock (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 Rights 
expressly waives his right to receive any fractional Rights or any fractional 
shares upon exercise of a Right, except as permitted by this Section 14.

     Section 15.  Rights of Action.  All rights of action in respect of this
                  ----------------
Agreement, other than rights of action vested in the Rights Agent pursuant to 
Section 18 hereof, are vested in the respective registered holders of the 
Rights Certificates (and, prior to the Distribution Date, the registered 
holders of the Common Stock); and any registered holder of any Rights 
Certificate (or, prior to the Distribution Date, of the Common Stock), without 
the consent of the Rights Agent or of the holder of any other Rights 
Certificate (or, prior to the Distribution Date, of the Common Stock), may, in 
his own behalf and for his own benefit, enforce, and may institute and 
maintain any suit, action or proceeding against the Company to enforce, or 

                                        - 35 -
<PAGE>

otherwise act in respect of, his right to exercise the Rights evidenced by 
such Rights Certificate in the manner provided in such Rights 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 shall be entitled to specific performance of the obligations 
hereunder and injunctive relief against actual or threatened violations of the 
obligations hereunder of any Person subject to this Agreement.

      Section 16.  Agreement of Rights 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 Common Stock;

             (b)  after the Distribution Date, the Rights Certificates are 
transferable only on the registry books of the Rights Agent if surrendered at 
the principal office or offices of the Rights Agent designated for such 
purposes, duly endorsed or accompanied by a proper instrument of transfer and 
with the appropriate forms and certificates fully executed;

             (c)  subject to Section 6(a) and Section 7(f) hereof, the Company 
and the Rights Agent may deem and treat the person in whose name a Rights 
Certificate (or, prior to the Distribution Date, the associated Common Stock 
certificate) is registered as the absolute owner thereof and of the Rights 
evidenced thereby (notwithstanding any notations of ownership or writing on 
the Rights Certificates or the associated Common Stock certificate made by 
anyone other than the Company or the Rights Agent) for all purposes 
whatsoever, and neither the Company nor the Rights Agent, subject to the last 
sentence of Section 7(e) hereof, shall be required to 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 

                                        - 36 -
<PAGE>


competent jurisdiction or by a governmental, regulatory or administrative 
agency or commission, or any statute, rule, regulation or executive order 
promulgated or enacted by any governmental authority, prohibiting or otherwise 
restraining performance of such obligation; provided, however, the Company
                                            --------
must use its best efforts to have any such order, decree or ruling lifted or 
otherwise overturned as soon as possible.

     Section 17.  Rights Certificate Holder Not Deemed a Stockholder.  No
                  --------------------------------------------------
holder, as such, of any Rights Certificate shall be entitled to vote, receive 
dividends or be deemed for any purpose the holder of the number of one 
two-hundredths of a share of Preferred Stock 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 Rights 
Certificate be construed to confer upon the holder of any Rights Certificate, 
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 Section 24 hereof), or to receive 
dividends or subscription rights, or otherwise, until the Right or Rights 
evidenced by such Rights Certificate shall have been exercised in accordance 
with the provisions hereof.

     Section 18.  Concerning the Rights Agent.
                  ---------------------------

             (a)  The Company agrees to pay to the Rights Agent reasonable 
compensation for all services rendered by it hereunder and, from time to time, 
on demand of the Rights Agent, its reasonable expenses and counsel fees and 
disbursements 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 in the premises.

             (b)  The Rights Agent shall be protected and shall incur no 
liability for or in respect of any action 

                                        - 37 -
<PAGE>


taken, suffered or omitted by it in connection with its administration of this 
Agreement in reliance upon any Rights Certificate or certificate for Common 
Stock or for other securities of the Company, instrument of assignment or 
transfer, power of attorney, endorsement, affidavit, letter, notice, 
direction, consent, certificate, statement, or other paper or document 
believed by it to be genuine and to be signed, executed and, where necessary, 
verified or acknowledged, by the proper Person or Persons, or otherwise upon 
the advice of counsel as set forth in Section 20 hereof.

     Section 19.  Merger or Consolidation or Change of Name of Rights Agent.
                  ---------------------------------------------------------
             (a)  Any corporation into which the Rights Agent or any successor 
Rights Agent may be merged or with which it may be consolidated, or any 
corporation resulting from any merger or consolidation to which the Rights 
Agent or any successor Rights Agent shall be a party, or any corporation 
succeeding to the corporate trust or stock transfer 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, however, 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 
Rights Certificates shall have been countersigned but not delivered, any such 
successor Rights Agent may adopt the countersignature of a predecessor Rights 
Agent and deliver such Rights Certificates so countersigned; and in case at 
that time any of the Rights Certificates shall not have been countersigned, 
any successor Rights Agent may countersign such Rights Certificates either in 
the name of the predecessor or in the name of the successor Rights Agent; and 
in all such cases such Rights Certificates shall have the full force provided 
in the Rights Certificates and in this Agreement.

             (b)  In case at any time the name of the Rights Agent shall be 
changed and at such time any of the Rights Certificates shall have been 
countersigned but not delivered, the Rights Agent may adopt the 
countersignature under its prior name and deliver Rights Certificates so 
countersigned; and in case at that time any of the Rights Certificates shall 
not have been countersigned, the Rights Agent may countersign such 

                                        - 38 -
<PAGE>


Rights Certificates either in its prior name or in its changed name; and in 
all such cases such Rights Certificates shall have the full force provided in 
the Rights Certificates and in this Agreement.

     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 Rights 
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 (including, without limitation, the identity of any Acquiring Person 
or Adverse Person and the determination of "current market price") 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 the Chairman of the Board, the 
President, any Vice President, the Treasurer, any Assistant Treasurer, the 
Secretary or any Assistant Secretary of the Company and delivered to the 
Rights Agent; and such certificate shall be full authorization to the Rights 
Agent for any action taken or suffered in good faith by it under the 
provisions of this Agreement in reliance upon such certificate.

             (c)  The Rights Agent shall be liable hereunder 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 
Rights Certificates or be required to verify the same (except as to its 
countersignature on such Rights Certificates), but all such statements and 
recitals are and shall be deemed to have been made by the Company only.

                                        - 39 -
<PAGE>

             (e)  The Rights Agent shall not be under any responsibility in 
respect of the validity of this Agreement or the execution and delivery hereof 
(except the due execution hereof by the Rights Agent) or in respect of the 
validity or execution of any Rights 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 Rights 
Certificate; nor shall it be responsible for any change in the exercisability 
of the Rights (including the Rights becoming void pursuant to Section 7(e) 
hereof) or adjustment required under the provisions of Section 11 or 
Section 13 or any other provision hereof or responsible for the manner, method 
or amount of any such adjustment or the ascertaining of the existence of facts 
that would require any such adjustment (except with respect to the exercise of 
Rights evidenced by Rights Certificates after receipt of the certificate 
described in Section 12 hereof setting forth any such adjustment); nor shall 
it by any act hereunder be deemed to make any representation or warranty as to 
the authorization or reservation of any shares of Common Stock or Preferred 
Stock to be issued pursuant to this Agreement or any Rights Certificate or as 
to whether any shares of Common Stock or Preferred Stock will, when so issued, 
be validly authorized and issued, fully paid and nonassessable.

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

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

             (h)  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 

                                        - 40 -
<PAGE>


proposed to be taken or omitted by the Rights Agent under this Rights 
Agreement and the date on and/or 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 the Chairman of the Board, the President, any Vice President, the 
Secretary, any Assistant Secretary, the Treasurer or any Assistant Treasurer 
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 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.

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

             (j)  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, however, reasonable care
                                          --------
was exercised in the selection and continued employment thereof.

             (k)  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.

                                        - 41 -
<PAGE>

             (l)  If, with respect to any Rights 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 thereof, 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 thereby be discharged from its duties under this 
Agreement upon thirty (30) days' notice in writing mailed to the Company, and 
to each transfer agent of the Common Stock and Preferred Stock, by registered 
or certified mail, and to the holders of the Rights Certificates by 
first-class mail.  The Company may remove the Rights Agent or any successor 
Rights Agent upon thirty (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 Stock and Preferred Stock, by registered or certified 
mail, and to the holders of the Rights 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 
thirty (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 Rights Certificate (who 
shall, with such notice, submit his Rights Certificate for inspection by the 
Company), then any registered holder of any Rights Certificate may apply to 
any court of competent jurisdiction for the appointment of a new Rights Agent.  
Any successor Rights Agent, whether appointed by the Company or by such a 
court, shall be (a) a corporation or financial institution organized and doing 
business under the laws of the United States or of the States of New York, 
Pennsylvania or Ohio (or of any other state of the United States so long as 
such corporation is authorized to do business as a banking institution in the 
States of New York, Pennsylvania or Ohio), in good standing, and having a 
principal office in the States of New York, Pennsylvania or Ohio, 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 
                                        - 42 -
<PAGE>


as Rights Agent a combined capital and surplus of at least $100,000,000 or (b) 
an affiliate of a corporation or financial institution described in clause (a) 
of this sentence.  After appointment, the successor Rights Agent shall be 
vested with the same powers, rights, duties and responsibilities as if it had 
been originally named as Rights Agent without further act or deed; but the 
predecessor Rights Agent shall deliver, and transfer to the successor Rights 
Agent any property at the time held by it hereunder, and execute and deliver 
any further assurance, conveyance, act or deed necessary for the purpose.  Not 
later than the effective date of any such appointment, the Company shall file 
notice thereof in writing with the predecessor Rights Agent and each transfer 
agent of the Common Stock and the Preferred Stock, and mail a notice thereof 
in writing to the registered holders of the Rights 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 Rights Certificates.  Notwithstanding any of
                  -----------------------------------
the provisions of this Agreement or of the Rights to the contrary, the Company 
may, at its option, issue new Rights Certificates evidencing Rights in such 
form as may be approved by its Board of Directors to reflect any adjustment or 
change in the Purchase Price and the number or kind or class of shares or 
other securities or property purchasable under the Rights Certificates made in 
accordance with the provisions of this Agreement.  In addition, in connection 
with the issuance or sale of shares of Common Stock following the Distribution 
Date and prior to the redemption or expiration of the Rights, the Company 
(a) shall, with respect to shares of Common Stock so issued or sold pursuant 
to the exercise of stock options or under any employee plan or arrangement, or 
upon the exercise, conversion or exchange of securities hereinafter issued by 
the Company, and (b) may, in any other case, if deemed necessary or 
appropriate by the Board of Directors of the Company, issue Rights 
Certificates representing the appropriate number of Rights in connection with 
such issuance or sale; provided, however, that (i) no such Rights Certificate 
                       --------
shall be issued if, and to the extent that, the Company shall be advised by 
counsel that such issuance would create a significant risk of material adverse 
tax consequences to the Company or the Person to whom such Rights Certificate 
would be issued, and (ii) no such 

                                        - 43 -
<PAGE>


Rights Certificate shall be issued if, and to the extent that, appropriate 
adjustment shall otherwise have been made in lieu of the issuance thereof.

     Section 23.  Redemption and Termination.
                  --------------------------
                  (a)(i)  The Board of Directors of the Company may, at its 
option, at any time prior to the earlier of (x) the close of business on the 
tenth Business Day following the Stock Acquisition Date (or, if the Stock 
Acquisition Date shall have occurred prior to the Record Date, the close of 
business on the tenth Business Day following the Record Date), or (y) the 
Final Expiration Date, redeem all but not less than all the then outstanding 
Rights at a redemption price of $0.0025 per Right, as such amount may be 
appropriately adjusted, as determined by the Board of Directors, 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"); provided, however, that, except as set forth in
                     --------  -------
Section 23(a)(ii) hereof, the Board of Directors of the Company shall be 
entitled so to redeem the Rights only if it consists of a majority of 
Continuing Directors (as hereinafter defined).  The term "Continuing Director" 
shall mean a director who either was a member of the Board of Directors of the 
Company prior to February 23, 1996 or who subsequently became a director of 
the Company and whose election, or nomination for election by the Company's 
stockholders, was approved by a vote of a majority of the Continuing Directors 
then on the Board of Directors of the Company.  Notwithstanding the foregoing, 
but subject to Section 23(a)(ii) hereof, the Board of Directors of the Company 
may not redeem any Rights after the tenth Business Day following the effective 
date of any declaration that any Person is an Adverse Person (as provided in 
Section 11(a)(ii)(B)).

                  (ii)  If, following the occurrence of a Stock Acquisition 
Date and/or following the expiration of the right of redemption hereunder but 
prior to any Triggering Event, (x) a Person who is an Acquiring Person shall 
have transferred or otherwise disposed of a number of shares of Common Stock 
in one transaction or series of transactions, not directly or indirectly 
involving the Company or any of its Subsidiaries, which did not result in the 
occurrence of a Triggering Event such that such Person is thereafter a 
Beneficial Owner of less than 10% of the outstanding shares of Common Stock, 
and (y) there are no other Persons, immediately following the occurrence of 
the event described in 

                                        - 44 -
<PAGE>


clause (x), who are Acquiring Persons or Adverse Persons, then the right of 
redemption shall be reinstated and thereafter be subject to the provisions of 
this Section 23.

                  (iii)  Notwithstanding anything contained in this Agreement 
to the contrary, the Rights shall not be exercisable after the first 
occurrence of an event described in Section 11(a)(ii) until such time as the 
Company's right of redemption hereunder has expired.

                  (iv)  The Company may, at its option, pay the Redemption 
Price in cash, shares of Common Stock (based on the "current market price," as 
defined in Section 11(d)(i) hereof, of the Common Stock at the time of 
redemption) or any other form of consideration deemed appropriate by the Board 
of Directors.

                  (b)  Immediately upon the action of the Board of Directors 
of the Company 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 for each Right so held.  Promptly after the action of the 
Board of Directors ordering the redemption of the Rights, the Company shall 
give notice of such redemption to the Rights Agent and the holders of the then 
outstanding Rights by mailing such notice to all such holders at each holder's 
last address as it appears upon the registry books of the Rights Agent or, 
prior to the Distribution Date, on the registry books of the Transfer Agent 
for the Common Stock.  Any notice which is mailed in the manner herein 
provided shall be deemed given, whether or not the holder receives the notice.  
Each such notice of redemption will state the method by which the payment of 
the Redemption Price will be made.

     Section 24.  Notice of Certain Events.
                  ------------------------
                  (a)  In case the Company shall propose, at any time after 
the Distribution Date, (i) to pay any dividend payable in stock of any class 
to the holders of Preferred Stock or to make any other distribution to the 
holders of Preferred Stock (other than a regular quarterly cash dividend out 
of earnings or retained earnings of the Company), or (ii) to offer to the 
holders of Preferred Stock rights or warrants to subscribe for or to purchase 
any additional shares of Preferred Stock or shares of stock of any class or 
any 

                                        - 45 -
<PAGE>

other securities, rights or options, or (iii) to effect any reclassification 
of its Preferred Stock (other than a reclassification involving only the 
subdivision of outstanding shares of Preferred Stock), or (iv) to effect any 
consolidation or merger into or with any other Person (other than a Subsidiary 
of the Company in a transaction which complies with Section 11(n) hereof), 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 transaction or a 
series of related transactions, of more than 50% of the assets or earning 
power of the Company and its Subsidiaries (taken as a whole) to any other 
Person or Persons (other than the Company and/or any of its Subsidiaries in 
one or more transactions each of which complies with Section 11(n) hereof), or 
(v) to effect the liquidation, dissolution or winding up of the Company, then, 
in each such case, the Company shall give to each holder of a Rights 
Certificate, to the extent feasible and 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, 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 shares of Preferred Stock, if any 
such date is to be fixed, and such notice shall be so given in the case of any 
action covered by clause (i) or (ii) above at least twenty (20) days prior to 
the record date for determining holders of the shares of Preferred Stock for 
purposes of such action, and in the case of any such other action, at least 
twenty (20) days prior to the date of the taking of such proposed action or 
the date of participation therein by the holders of the shares of Preferred 
Stock, whichever shall be the earlier.

                  (b)  In case any of the events set forth in 
Section 11(a)(ii) hereof shall occur, then, in any such case, (i) the Company 
shall as soon as practicable thereafter give to each holder of a Rights 
Certificate, to the extent feasible and 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(a)(ii) 
hereof, and (ii) all references in the preceding paragraph to Preferred Stock 
shall be deemed thereafter to refer to Common Stock and/or, if appropriate, 
other securities.
                                        - 46 -
<PAGE>

     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 Rights 
Certificate to or on the Company shall be sufficiently given or made if 
delivered by hand, sent by overnight courier or sent by first-class mail, 
postage prepaid, addressed (until another address is filed in writing with the 
Rights Agent) as follows:

                  Armco Inc.
                  One Oxford Centre
                  301 Grant Street
                  Pittsburgh, PA  15219-1415
                  Attention:  Secretary

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

                  Fifth Third Bank
                  Corporate Trust Department
                  #1090  02
                  38 Fountain Square Plaza
                  Cincinnati, Ohio  45202

Notices or demands authorized by this Agreement to be given or made by the 
Company or the Rights Agent to the holder of any Rights Certificate (or, if 
prior to the Distribution Date, to the holder of certificates representing 
shares of Common Stock) 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.  Prior to the Distribution Date
                  --------------------------
and subject to the penultimate sentence of this Section 26, 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 shares of Common Stock.  From and after the 
Distribution Date and subject to the penultimate sentence of this Section 26, 
the Company and the Rights Agent shall, if the Company so directs, supplement 
or amend this Agreement without the approval of any holders of Rights 

                                        - 47 -
<PAGE>

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 shorten or lengthen any time period 
hereunder, or (iv) to change or supplement the provisions hereunder in any 
manner which the Company may deem necessary or desirable and which shall not 
adversely affect the interests of the holders of Rights Certificates (other 
than an Acquiring Person, an Adverse Person or an Affiliate or Associate of 
any such Person); provided, this Agreement may not be supplemented or amended 
                  --------
to lengthen, pursuant to clause (iii) of this sentence, (A) a time period 
relating to when the Rights may be redeemed at such time as the Rights are not 
then redeemable, or (B) any other time period unless such lengthening of such 
other time period is for the purpose of protecting, enhancing or clarifying 
the rights of, and/or the benefits to, the holders of Rights; and provided 
                                                                  --------
further, that any amendment to Section 23(a) hereof shall be effective only if 
-------
it is approved when the Board of Directors of the Company consists of a 
majority of Continuing Directors.  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, the Final Expiration Date, the 
Purchase Price or the number of one onehundredths of a share of Preferred 
Stock 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 hereunder.

     Section 28.  Determinations and Actions by the Board of Directors, etc. 
                  ---------------------------------------------------------
(a) For all purposes of this Agreement, any calculation of the number of 
shares of Common Stock outstanding at any particular time, including for 
purposes of determining the particular percentage of such outstanding shares 
of Common Stock of which any Person is the Beneficial Owner, shall be made in 
accordance with the last sentence of Rule 13d3(d)(1)(i) of the General Rules 
and Regulations under 

                                        - 48 -
<PAGE>

the Exchange Act as in effect on the date hereof.  The Board of Directors of 
the Company (or, as set forth herein, certain specified members thereof) shall 
have the exclusive power and authority to administer this Agreement and to 
exercise all rights and powers specifically granted to the Board of Directors 
of the Company or to the Company, or as may be necessary or advisable in the 
administration of this Agreement, including, without limitation, the right and 
power to (i) interpret the provisions of this Agreement, and (ii) make all 
determinations deemed necessary or advisable for the administration of this 
Agreement (including, but not limited to, a determination to redeem or not 
redeem the Rights, to declare that a Person is an Adverse Person or to amend 
this Agreement).  All such actions, calculations, interpretations and 
determinations (including, for purposes of clause (y) below, all omissions 
with respect to the foregoing) which are done or made by the Board of 
Directors of the Company in good faith, shall (x) be final, conclusive and 
binding on the Company, the Rights Agent, the holders of the Rights and all 
other parties, and (y) not subject the Board to any liability to the holders 
of the Rights.

                  (b) For purposes of this Agreement, any determination to be 
made by the Board of Directors of the Company may be made by a duly 
constituted committee thereof if so authorized to act by the Board of 
Directors pursuant to the Company's Regulations, and in such circumstances any 
reference to the Board of Directors herein shall be deemed to include a 
reference to such committee.

     Section 29.  Benefits of This Agreement.  Nothing in this Agreement shall
                  --------------------------
be construed to give to any Person other than the Company, the Rights Agent 
and the registered holders of the Rights Certificates (and, prior to the 
Distribution Date, registered holders of the Common Stock) 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 Rights Certificates (and, prior to the 
Distribution Date, registered holders of the Common Stock).

     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 

                                        - 49 -
<PAGE>


force and effect and shall in no way be affected, impaired or invalidated; 
provided, however, that 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 of Directors of the Company 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 Business Day following the 
date of such determination by the Board of Directors of the Company.

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

     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.

Attest:	ARMCO INC.



By  /s/ Regina M. Scolieri             By /s/ Gary R. Hildreth
  ----------------------------------   -----------------------------------
   Name: Regina M. Scolieri            Name:   Gary R. Hildreth
   Title:                              Title:  Vice President

                                        - 50 -
<PAGE>

Attest:                                 FIFTH THIRD BANK



By  /s/ Greg Hahn                    By /s/ Kerry Byrne
   -------------------------------   -------------------------------
   Name:   Greg Hahn	    Name:  Kerry Byrne
   Title:  Trust Officer                Title: Vice President 

                                        - 51 -
<PAGE>
                                                              Exhibit A
                            [Form of Rights Certificate]


Certificate No. R-                                         -------- Rights
                                                          

NOT EXERCISABLE AFTER JUNE 26, 2006 OR EARLIER IF REDEEMED BY THE COMPANY.  
THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.0025 
PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.  UNDER CERTAIN 
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN ADVERSE 
PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT 
HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID.  [THE RIGHTS REPRESENTED BY 
THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR 
BECAME AN ACQUIRING [ADVERSE] PERSON OR AN AFFILIATE OR ASSOCIATE OF AN 
ACQUIRING [ADVERSE] PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS 
AGREEMENT).  ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED 
HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) 
OF SUCH AGREEMENT.]*



                                 Rights Certificate

                                      ARMCO INC.

     This certifies that                  , or registered assigns, is the 
registered owner of the number of Rights set forth above, each of which 
entitles the owner thereof, subject to the terms, provisions and conditions of 
the Rights Agreement, dated as of February 23, 1996 (the "Rights Agreement"), 
between Armco Inc., an Ohio corporation (the "Company"), and Fifth Third Bank 
(the "Rights Agent"), to purchase from the Company at any time prior to 
5:00 P.M. (Pittsburgh, Pennsylvania time) on June 26, 20006 at the office or 
offices of the Rights Agent designated for such purpose, or its successors as 
Rights Agent, one two-hundredths of a fully paid, nonassessable share of 
Class A Preferred Stock designated as Participating Preferred Stock (the 

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

* The portion of the legend in brackets shall be inserted only if applicable, 
shall be modified to apply to an Acquiring Person or an Adverse Person, as 
applicable, and shall replace the preceding sentence.


<PAGE>
"Preferred Stock") of the Company, at a purchase price of $20.00 per one 
two-hundredths of a share (the "Purchase Price"), upon presentation and 
surrender of this Rights Certificate with the Form of Election to Purchase and 
related Certificate duly executed.  The Purchase Price may be paid in cash or 
by certified bank check or money order payable to the order of the Company.  
The number of Rights evidenced by this Rights Certificate (and the number of 
shares which may be purchased upon exercise thereof) set forth above, and the 
Purchase Price per share set forth above, are the number and Purchase Price as 
of February 23, 1996, based on the Preferred Stock as constituted at such 
date.

     Upon the occurrence of a Section 11(a)(ii) Event (as such term is defined 
in the Rights Agreement), if the Rights evidenced by this Rights Certificate 
are beneficially owned by (i) an Acquiring Person, an Adverse Person or an 
Affiliate or Associate of any such Person (as such terms are defined in the 
Rights Agreement), (ii) a transferee of any such Acquiring Person, Adverse 
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, an Adverse Person or an Affiliate or Associate of 
any such 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 such Section 11(a)(ii) Event.

     As provided in the Rights Agreement, the Purchase Price and the number 
and kind of shares of Preferred Stock or other securities which may be 
purchased upon the exercise of the Rights evidenced by this Rights Certificate 
are subject to modification and adjustment upon the happening of certain 
events, including Triggering Events (as such term is defined in the Rights 
Agreement).

     This Rights 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 Rights Certificates, 
which limitations of rights include the temporary suspension of the 
exercisability of such Rights under the specific circumstances set forth in 
the 

                                        - 2 -
<PAGE>

Rights Agreement.  Copies of the Rights Agreement are available upon written 
request to the Company.

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

     Subject to the provisions of the Rights Agreement, the Rights evidenced 
by this Certificate may be redeemed by the Company at its option at a 
redemption price of $0.0025 per Right at any time prior to the earliest of the 
close of business on (i) the tenth business day following the Stock 
Acquisition Date (as such time period may be extended pursuant to the Rights 
Agreement), (ii) the tenth business day following the effectiveness of a 
declaration by the Board of Directors that a Person is an Adverse Person, and 
(iii) the Final Expiration Date; provided, however, that with certain 
exceptions the Company shall be entitled so to redeem the Rights only if the 
Board of Directors consists of a majority of Continuing Directors (as such 
term is defined in the Rights Agreement).  After the expiration of the 
redemption period, the Company's right of redemption may be reinstated if an 
Acquiring Person reduces his beneficial ownership to less than 10% of the 
outstanding shares of Common Stock in a transaction or series of transactions 
not involving the Company and there are no other Acquiring Persons or Adverse 
Persons.

     The Company may (but shall not be required to) issue fractional shares of 
Preferred Stock upon the exercise of any Right or Rights evidenced hereby 
(other than fractions which are integral multiples of one two-hundredth of a 
share of Preferred Stock, which may, at the election of the Company, be 
evidenced by depositary receipts), and in lieu thereof a cash payment may be 
made, as provided in the Rights Agreement.

     No holder of this Rights Certificate, as such, shall be entitled to vote 
or receive dividends or be 

                                        - 3 -
<PAGE>

deemed for any purpose the holder of shares of Preferred Stock 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 Rights Certificate 
shall have been exercised as provided in the Rights Agreement.

     This Rights 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               ,     
            ----------- --


ATTEST:                                ARMCO INC.



                                      By                    
---------------------------             ---------------------------
      Secretary                         Title:



Countersigned:

FIFTH THIRD BANK



By---------------------------
    Authorized Signature

                                        - 4 -
<PAGE>

                      [Form of Reverse Side of Rights Certificate]


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

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


FOR VALUE RECEIVED                                hereby
                   ------------------------------

sells, assigns and transfers unto                       
                                  ----------------------------------

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	(Please print name and address of transferee)

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

Dated:                 ,     
       ---------------- -----

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


Signature Guaranteed:



                                     Certificate
                                     -----------

     The undersigned hereby certifies by checking the appropriate boxes that:

     (1)  this Rights Certificate [ ] is [ ] is not being sold, assigned and 
transferred by or on behalf of a Person who is or was an Acquiring Person, an 
Adverse Person or an Affiliate or Associate of any such 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 

                                        - 5 -
<PAGE>

Rights evidenced by this Rights Certificate from any Person who is, was or 
subsequently became an Acquiring Person, an Adverse Person or an Affiliate or 
Associate of any such Person.

Dated:                  ,                    -------------------------------
       -----------------  -----              Signature


Signature Guaranteed:



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

                                        - 6 -
<PAGE>


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

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


To:  ARMCO INC.

      The undersigned hereby irrevocably elects to exercise                 
                                                            ---------------
Rights represented by this Rights Certificate to purchase the shares of 
Preferred Stock issuable upon the exercise of the Rights (or such other 
securities of the Company or of any other person which may be issuable upon 
the exercise of the Rights) and requests that certificates for such shares be 
issued in the name of and delivered to:

Please insert social security
or other identifying number

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                          (Please print name and address)

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     If such number of Rights shall not be all the Rights evidenced by this 
Rights Certificate, a new Rights Certificate for the balance 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)

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Dated:                 ,     
       ----------------  -----

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


Signature Guaranteed:
                                        - 7 -
<PAGE>


                                     Certificate
                                     -----------
     The undersigned hereby certifies by checking the appropriate boxes that:

     (1)  the Rights evidenced by this Rights Certificate [ ] are [ ] are not 
being exercised by or on behalf of a Person who is or was an Acquiring Person, 
an Adverse Person or an Affiliate or Associate of any such Person (as such 
terms are defined in 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 Rights Certificate 
from any Person who is, was or became an Acquiring Person, an Adverse Person 
or an Affiliate or Associate of any such Person.

Dated:                  ,                 ----------------------------------
       ------------------ ----            Signature


Signature Guaranteed:
                                        - 8 -
<PAGE>


                                        NOTICE
                                        ------

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

                                                                   Exhibit B

                    SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK


     On February 23, 1996, the Board of Directors of Armco Inc. (the 
"Company") declared a dividend distribution of one Right for each outstanding 
share of Company Common Stock to stockholders of record at the close of 
business on June 26, 1996.  One Right will also be distributed for each share 
of Common Stock issued after June 26, 1996, until the Distribution Date (which 
is described in the next paragraph).  Each Right entitles the registered 
holder to purchase from the Company a unit consisting of one two-hundredths of 
a share (a "Unit") of Class A Preferred Stock, designated as Participating 
Preferred Stock (the "Preferred Stock"), at a Purchase Price of $20.00 per 
Unit, subject to adjustment.  The description and terms of the Rights are set 
forth in a Rights Agreement dated as of February 23, 1996 (the "Rights 
Agreement") between the Company and Fifth Third Bank, as Rights Agent.

     Initially, the Rights will be attached to all Common Stock certificates 
representing shares then outstanding, and no separate Rights Certificates will 
be distributed.  The Rights will separate from the Common Stock and a 
Distribution Date will occur upon the earliest of (i) 10 business days 
following a public announcement that a person or group of affiliated or 
associated persons (an "Acquiring Person") has acquired, or obtained the right 
to acquire, beneficial ownership of 20% or more of the outstanding shares of 
Common Stock (the "Stock Acquisition Date"), (ii) 10 business days following 
the commencement of a tender offer or exchange offer that would if consummated 
result in a person or group beneficially owning 20% or more of such 
outstanding shares of Common Stock or (iii) 10 business days after the Board 
of Directors of the Company shall declare any Person to be an "Adverse 
Person," upon a determination that such person, alone or together with its 
affiliates and associates, has or will become the Beneficial Owner of 10% or 
more of the outstanding shares of Common Stock (provided that any such 
determination shall not be effective until such Person has become the 
Beneficial Owner of 10% or more of the outstanding shares of Common Stock) and 
a determination by at least a majority of the "Continuing Directors" (who 
generally are those directors who were directors of the Company on 
February 23, 1996 or who subsequently became directors and whose elections or 
nominations were approved by a majority of Continuing Directors), including 
consultation with such persons as such 

<PAGE>

directors shall deem appropriate, that (a) such beneficial ownership by such 
person is intended to cause, is reasonably likely to cause or will cause the 
Company to repurchase the Common Stock beneficially owned by such person or to 
cause pressure on the Company to take action or enter into a transaction or 
series of transactions intended to provide such person with short-term 
financial gain under circumstances where the Board of Directors determines 
that the best long-term interests of the Company and its stockholders would 
not be served by taking such action or entering into such transactions or 
series of transactions at that time or (b) such beneficial ownership is 
causing or is reasonably likely to cause a material adverse impact (including, 
but not limited to, impairment of relationships with customers or impairment 
of the Company's ability to maintain its competitive position) on the business 
or prospects of the Company or (c) such beneficial ownership otherwise is 
determined to be not in the best interests of the Company and its 
stockholders, employees, customers and communities in which the Company and 
its subsidiaries do business.

     However, the Board of Directors may not declare a person to be an Adverse 
Person if, prior to the time that the person acquired 10% or more of the 
shares of Common Stock then outstanding, such person provided to the Board of 
Directors in writing a statement of the person's purpose and intentions in 
connection with the proposed acquisition of Common Stock, together with any 
other information reasonably requested of the person by the Board of 
Directors, and the Board of Directors, based on such statement and reasonable 
inquiry and investigation as it deems appropriate, determines to notify and 
notifies such person in writing that it will not declare the person to be an 
Adverse Person; provided, however, that the Board of Directors may expressly 
condition in any manner a determination not to declare a person an Adverse 
Person on such conditions as the Board of Directors may select, including, 
without limitation, such person's not acquiring more than a specified amount 
of stock and/or on such person's not taking actions inconsistent with the 
purposes and intentions disclosed by such person in the statement provided to 
the Board of Directors.  In the event that the Board of Directors should at 
any time determine, upon reasonable inquiry and investigation, that such 
person has not met or complied with any conditions specified by the Board of 
Directors, the Board of Directors may at any time thereafter declare the 
person to be an Adverse Person.

                                        - 2 -
<PAGE>

     Until the Distribution Date (i) the Rights will be evidenced by the 
Common Stock certificates and will be transferred with and only with such 
Common Stock certificates, (ii) new Common Stock certificates issued after 
June 26, 1996 will contain a notation incorporating the Rights Agreement by 
reference and (iii) the surrender for transfer of any certificates for Common 
Stock outstanding will also constitute the transfer of the Rights associated 
with the Common Stock represented by such certificate.

     The Rights are not exercisable until the Distribution Date and will 
expire at the close of business on June 26, 2006, unless earlier redeemed by 
the Company as described below.

     As soon as practicable after the Distribution Date, Rights Certificates 
will be mailed to holders of record of the Common Stock as of the close of 
business on the Distribution Date and, thereafter, the separate Rights 
Certificates alone will represent the Rights.  Except for certain issuances in 
connection with outstanding options and convertible securities and as 
otherwise determined by the Board of Directors, only shares of Common Stock 
issued prior to the Distribution Date will be issued with Rights.

     In the event that the Board of Directors determines that a person is an 
Adverse Person or, at any time following the Distribution Date, a person 
becomes the beneficial owner of 25% or more of the then-outstanding shares of 
Common Stock, each holder of a Right will thereafter have the right to receive 
at the time specified in the Rights Agreement, (x) upon exercise and payment 
of the exercise price, Common Stock (or, in certain circumstances, cash, 
property or other securities of the Company) having a value equal to two times 
the exercise price of the Right or (y) at the discretion of the Board of 
Directors, upon exercise and without payment of the exercise price, Common 
Stock (or, in certain circumstances, cash, property or other securities of the 
Company) having a value equal to the difference between the exercise price of 
the Right and the value of the consideration which would be payable under 
clause (x).  Notwithstanding any of the foregoing, following the occurrence of 
any of the events set forth in this paragraph, all Rights that are, or (under 
certain circumstances specified in the Rights Agreement) were, beneficially 
owned by any Acquiring Person or Adverse Person will be null and void.  
However, Rights 

                                        - 3 -
<PAGE>

are not exercisable following the occurrence of either of the events set forth 
above until such time as the Rights are no longer redeemable by the Company as 
set forth below.

     For example, at an exercise price of $20.00 per Right, each Right not 
owned by an Acquiring Person or an Adverse Person (or by certain related 
parties) following an event set forth in the preceding paragraph would entitle 
its holder to purchase $40.00 worth of Common Stock (or other consideration, 
as noted above) for $20.00.  Assuming that the Common Stock had a per share 
value of $10.00 at such time, the holder of each valid Right would be entitled 
to purchase four shares of Common Stock for $20.00.  Alternatively, at the 
discretion of the Board of Directors, each Right following an event set forth 
in the preceding paragraph, without payment of the exercise price, would 
entitle its holder to Common Stock (or other consideration, as noted above) 
worth $20.00.

     In the event that, at any time following the Stock Acquisition Date, (i) 
the Company is acquired in a merger or other business combination transaction 
in which the Company is not the surviving corporation (other than a merger 
which follows an offer described in the second preceding paragraph), or (ii) 
50% or more of the Company's assets or earning power is sold or transferred, 
each holder of a Right (except Rights which previously have been voided as set 
forth above) shall thereafter have the right to receive, upon exercise, common 
stock of the acquiring company having a value equal to two times the exercise 
price of the Right.  The events set forth in this paragraph and in the second 
preceding paragraph are referred to as the "Triggering Events."

     The Purchase Price payable, and the number of Units of Preferred Stock or 
other securities or property issuable, upon exercise of the Rights are subject 
to adjustment from time to time to prevent dilution (i) in the event of a 
stock dividend on, or a subdivision, combination or reclassification of, the 
Preferred Stock, (ii) if holders of the Preferred Stock are granted certain 
rights or warrants to subscribe for Preferred Stock or convertible securities 
at less than the current market price of the Preferred Stock, or (iii) upon 
the distribution to holders of the Preferred Stock of evidences of 
indebtedness or assets (excluding regular quarterly cash dividends) or of 
subscription rights or warrants (other than those referred to above).

                                        - 4 -
<PAGE>

     With certain exceptions, no adjustment in the Purchase Price will be 
required until cumulative adjustments amount to at least 1% of the Purchase 
Price.  No fractional Units will be issued and, in lieu thereof, an adjustment 
in cash will be made based on the market price of the Preferred Stock on the 
last trading date prior to the date of exercise.

     In general, the Company may redeem the Rights in whole, but not in part, 
at a price of $0.0025 per Right, at any time until 10 business days following 
the Stock Acquisition Date; provided, however, that with certain exceptions 
the Company shall be so entitled to redeem the Rights only if the Board of 
Directors then consists of a majority of Continuing Directors.  Moreover, 
redemption would not be permitted after 10 business days following the 
effective date of any declaration by the Board of Directors that any person is 
an Adverse Person.  After the redemption period has expired, the Company's 
right of redemption may be reinstated if an Acquiring Person or Adverse Person 
reduces his beneficial ownership to less than 10% of the outstanding shares of 
Common Stock in a transaction or series of transactions not involving the 
Company and there are no other Acquiring Persons or Adverse Persons.  
Immediately upon the action of the Board of Directors ordering redemption of 
the Rights, the Rights will terminate and the only right of the holders of 
Rights will be to receive the $0.0025 redemption price.

     Until a Right is exercised, the holder thereof, as such, will have no 
rights as a stockholder of the Company, including, without limitation, the 
right to vote or to receive dividends.  While the distribution of the Rights 
will not be taxable to stockholders or to the Company, stockholders may, 
depending upon the circumstances, recognize taxable income in the event that 
the Rights become exercisable for stock (or other consideration) of the 
Company or for common stock of the acquiring company as set forth above.

     Other than those provisions relating to the principal economic terms of 
the Rights, any of the provisions of the Rights Agreement may be amended by 
the Board of Directors of the Company prior to the Distribution Date.  After 
the Distribution Date, the provisions of the Rights Agreement may be amended 
by the Board in order to cure any ambiguity, to make changes which do not 
adversely affect the interests of holders of Rights (excluding the interests 
of any Acquiring 

                                        - 5 -
<PAGE>


Person or Adverse Person), or to shorten or lengthen any time period under the 
Rights Agreement; provided, however, that no amendment to adjust the time 
period governing redemption shall be made when the Rights are not redeemable; 
and provided further, that any amendment to the redemption provision shall be 
effective only if the Board of Directors consists of a majority of Continuing 
Directors.

    A copy of the Rights Agreement has been filed with the Securities and 
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A 
dated              , 1996.  A copy of the Rights Agreement is available free
      -------------
of charge from the Company.  This summary description of the Rights does not 
purport to be complete and is qualified in its entirety by reference to the 
Rights Agreement, which is incorporated herein by reference.

                                        - 6 -