Document:

Rights Agreement dated 10/25/2002

Table of Contents

 Exhibit 4.01 
  
 RIGHTS AGREEMENT 
  
 BETWEEN 
  

KEYNOTE SYSTEMS, INC. 
  
 AND 
  
 AMERICAN STOCK TRANSFER & TRUST COMPANY, 
  
 AS RIGHTS AGENT 
  
 DATED AS OF OCTOBER 25, 2002 

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TABLE OF CONTENTS 
  
 
	  	  	  	  	 Page
 

	 
	 Section 1.
 	  	 
Certain Definitions
 	  	 1
 
	 
	 Section 2.
 	  	 
Appointment of Rights Agent 
 	  	 4
 
	 
	 Section 3.
 	  	 
Evidence of Rights Before Distribution Date; Transfer; Legends 
 	  	 5
 
	 
	 Section 4.
 	  	 
Evidence of Rights After Distribution Date; Form of Right Certificates; Countersignatures
 	  	 6
 
	 
	 Section 5.
 	  	 
Distribution of Certificates; Registration
 	  	 6
 
	 
	 Section 6.
 	  	 
Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates
 	  	 7
 
	 
	 Section 7.
 	  	 
Exercise of Rights; Purchase Price; Expiration Date of Rights
 	  	 7
 
	 
	 Section 8.
 	  	 
Cancellation and Destruction of Right Certificates
 	  	 9
 
	 
	 Section 9.
 	  	 
Status and Availability of Preferred Shares
 	  	 9
 
	 
	 Section 10.
 	  	 
Preferred Shares Record Date
 	  	 10
 
	 
	 Section 11.
 	  	 
Adjustment of Purchase Price, Number of Shares or Number of Rights
 	  	 10
 
	 
	 Section 12.
 	  	 
Certificate of Adjusted Purchase Price or Number of Shares
 	  	 16
 
	 
	 Section 13.
 	  	 
Consolidation, Merger or Sale or Transfer of Assets or Earning Power 
 	  	 16
 
	 
	 Section 14.
 	  	 
Fractional Rights and Fractional Shares
 	  	 17
 
	 
	 Section 15.
 	  	 
Rights of Action
 	  	 18
 
	 
	 Section 16.
 	  	 
Agreement of Right Holders
 	  	 18
 
	 
	 Section 17.
 	  	 
Right Certificate Holder Not Deemed a Stockholder
 	  	 19
 
	 
	 Section 18.
 	  	 
Compensation and Indemnity of the Rights Agent
 	  	 19
 
	 
	 Section 19.
 	  	 
Merger or Consolidation or Change of Name of Rights Agent 
 	  	 20
 
	 
	 Section 20.
 	  	 
Rights and Duties of Rights Agent
 	  	 20
 
	 
	 Section 21.
 	  	 
Change of Rights Agent
 	  	 23
 

 

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	 Section 22.
 	  	 
Issuance of New Right Certificates
 	  	 23
 
	 
	 Section 23.
 	  	 
Redemption
 	  	 24
 
	 
	 Section 24.
 	  	 
Exchange
 	  	 24
 
	 
	 Section 25.
 	  	 
Notice of Certain Events
 	  	 26
 
	 
	 Section 26.
 	  	 
Notices
 	  	 26
 
	 
	 Section 27.
 	  	 
Supplements and Amendments
 	  	 27
 
	 
	 Section 28.
 	  	 
Successors
 	  	 27
 
	 
	 Section 29.
 	  	 
Benefits of this Agreement
 	  	 27
 
	 
	 Section 30.
 	  	 
Severability
 	  	 27
 
	 
	 Section 31.
 	  	 
Governing Law
 	  	 28
 
	 
	 Section 32.
 	  	 
Counterparts
 	  	 28
 
	 
	 Section 33.
 	  	 
Descriptive Headings
 	  	 28
 
	 
	 Section 34.
 	  	 
Entire Agreement
 	  	 28
 
	 
	  	  	 
Signatures
 	  	 29
 
	 
	 Exhibit A-
 	  	 
Form of Certificate of Designations of Series A Junior Participating Preferred Stock 
 	  	  
	 
	 Exhibit B-
 	  	 
Summary of Rights to Purchase Preferred Shares
 	  	  
	 
	 Exhibit C-
 	  	 
Form of Right Certificate
 	  	  

 
  

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 RIGHTS AGREEMENT 
  
 This Agreement, dated as of October 25, 2002, between Keynote Systems, Inc., a Delaware corporation (the “Company”), and American Stock Transfer
& Trust Company, a New York company, as Rights Agent (the “Rights Agent”). 
  
 The Board
of Directors of the Company has authorized and declared a dividend of one preferred share purchase right (a “Right”) for each Common Share (as hereinafter defined) of the Company outstanding at the Close of Business (as
hereinafter defined) on October 29, 2002 (the “Record Date”), each Right representing the right to purchase one one-hundredth of a Preferred Share (as hereinafter defined), upon the terms and subject to the conditions herein
set forth, and has further authorized and directed the issuance of one Right with respect to each Common Share that shall become outstanding (i) between the Record Date and the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date (as such terms are hereinafter defined) or (ii) following the Distribution Date and prior to the Redemption Date or Final Expiration Date, pursuant to the exercise of stock options or under any employee plan or arrangement or upon
the exercise, conversion or exchange of other securities of the Company, which options or securities were outstanding prior to the Distribution Date. 
  
 Accordingly, in consideration of the premises and the mutual agreements herein set forth, the parties hereto hereby agree as follows: 
  
 
Section 1.    Certain Definitions.    For purposes of this Agreement, the following terms have the meanings indicated: 
  

(a)  “AcquiringPerson” shall mean any Person who or which, together with all Affiliates and Associates of such
Person, shall be the Beneficial Owner of 15% (the “Designated Percentage”) or more of the Common Shares of the Company then outstanding, but shall not include (i) the Company, (ii) any Subsidiary of the Company, (iii) any
employee benefit plan of the Company or of any Subsidiary of the Company or (iv) any entity holding Common Shares for or pursuant to the terms of any such plan. Notwithstanding the foregoing, 
  

(i)  No Person shall become an Acquiring Person if the Board of Directors of the Company determines in good faith that a Person who would
otherwise be an Acquiring Person has become such inadvertently, and such Person as promptly as practicable takes such actions as may be necessary so that such Person would no longer be considered an Acquiring Person. 
  
 (ii)  No Person shall become an Acquiring Person as the result of an acquisition of Common Shares by the Company
that, by reducing the number of shares outstanding, increases the proportionate number of shares beneficially owned by such Person and such Person’s Affiliates and Associates to the Designated Percentage or more of the Common Shares of the
Company then outstanding; provided, however, that if a Person, together with such Person’s Affiliates and Associates, shall become the Beneficial Owner of the Designated Percentage or more of the Common Shares of the Company then
outstanding by reason of share purchases by the Company and such Person, together with its Affiliates and Associates, shall, after public announcement of such share purchases by the Company, become the Beneficial

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Owner of any additional Common Shares of the Company, then such Person shall be deemed to be an “Acquiring Person.” 
  
 (b) “Affiliate” and “Associate” shall have the following meanings: 
  
 (i) An “Affiliate” of, or a Person “affiliated” with, a specified Person,
is a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified. For this purpose, “control” (including the terms
“controlling,” “controlled by” and “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by contract or otherwise; 
  
 (ii) The term “Associate” used to indicate a relationship with any Person shall mean (A) any corporation or organization (other than the Company or a majority-owned subsidiary of the Company) of which such
Person is an officer or partner or is, directly or indirectly, the Beneficial Owner of 10% or more of any class of equity securities, (B) any trust or other estate in which such Person has a substantial beneficial interest or as to which such Person
serves as trustee or in a similar fiduciary capacity, and (C) any relative or spouse of such Person, or any relative of such spouse, who has the same home as such Person or who is a director or officer of the Company or of any of its parents or
Subsidiaries. 
  
 (c) A Person shall be deemed the “Beneficial Owner” of and
shall be deemed to “beneficially own” any securities: 
  
 (i) that such
Person owns, directly or indirectly; 
  
 (ii) that such Person has (A) the right to acquire (whether
such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling group members with respect to a bona fide
public offering of securities), written or otherwise, or upon the exercise of conversion rights, exchange rights, rights (other than the Rights), warrants or options, or otherwise; provided, however, that a Person shall not be deemed
to be the Beneficial Owner of, or to beneficially own, securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person until such tendered securities are accepted for purchase or exchange; or (B) the right to vote
pursuant to any agreement, arrangement or understanding; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially own, any security if the agreement, arrangement or understanding to vote such
security (1) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations promulgated under the Exchange Act
and (2) is not also then reportable on Schedule 13D under the Exchange Act (or any comparable or successor report); or 
  
 (iii) that are beneficially owned, directly or indirectly, by any other Person with which such Person has any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling
group members with respect to a bona fide public offering of securities), written or otherwise, for the purpose of acquiring,
 

 
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holding, voting (except to the extent contemplated by the proviso to Section 1(c)(ii)(B)) or disposing of any securities of the Company. 
  
 Notwithstanding anything in this definition of Beneficial Ownership to the contrary, (A) the phrase “then outstanding,” when used
with reference to a Person’s Beneficial Ownership of securities of the Company, shall mean the number of such securities then issued and outstanding together with the number of such securities not then actually issued and outstanding that such
Person would be deemed to own beneficially hereunder, and (B) a Person who is a director or officer of the Company or who is an Affiliate or Associate of a director or officer of the Company (each, an “Exempted Person”) shall
not be deemed to “beneficially own” Common Shares held by another Exempted Person solely by reason of any agreement, arrangement or understanding, written or otherwise, entered into in opposition to a transaction that, at the time such
agreement, arrangement or understanding was entered into, has not been approved or recommended by the Board of Directors to the stockholders of the Company. 
  
 (d) “Business Day” shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in the State of
California are not open for business. 
  
 (e) “Close of Business” on any
given date shall mean 5:00 p.m., California Time, on such date; provided, however, that if such date is not a Business Day it shall mean 5:00 p.m., California Time, on the next succeeding Business Day. 
  
 (f) “Common Shares” when used with reference to the Company shall mean the shares of common stock,
par value $0.001 per share, of the Company. “Common Shares” when used with reference to any Person other than the Company shall mean the capital stock (or equity interest) with the greatest voting power of such other Person or, if such
other Person is a Subsidiary of another Person, of the Person or Persons that ultimately control such first-mentioned Person. 
  
 (g) “Designated Percentage” shall have the meaning set forth in Section 1(a) hereof. 
  
 (h) “Distribution Date” shall mean the earlier of (i) the tenth day after the Shares Acquisition Date or (ii) the tenth Business Day
(or such later date as may be determined by action of the Board of Directors of the Company prior to such time as any Person becomes an Acquiring Person) after the first public announcement of the intention of any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or of any Subsidiary of the Company or any entity holding Common Shares for or pursuant to the terms of any such plan) to commence a tender or exchange offer the consummation of
which would result in any such Person becoming an Acquiring Person (including any such date that is after the date of this Agreement and prior to the issuance of the Rights). 
  
 (i) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 
  

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

 
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 (k) “Person” shall mean any individual, firm, corporation, partnership, limited
partnership, business trust, limited liability company, unincorporated association or any other entity, and shall include any successor (by merger or otherwise) of such entity. 
  
 (l) “Purchase Price” shall have the meaning set forth in Section 7(b) hereof. 
  

(m) “Preferred Shares” shall mean shares of Series A Junior Participating Preferred Stock, par value $0.001 per share, of the
Company having the rights and preferences set forth in the Certificate of Designations attached to this Agreement as Exhibit A. 
  
 (n) “Redemption Date” shall have the meaning set forth in Section 7(a) hereof. 
  
 (o) “Rights” shall have the meaning set forth in the second paragraph of this Agreement, provided, however, that none
of the following shall be deemed “Rights” or “outstanding Rights” for any purpose under this Agreement from and after the effective time of the event indicated: (i) Rights that have become Void Rights pursuant to Section 7(f)
hereof, and upon such occurrence, all Right Certificates therefor shall be null and void and shall not be deemed “outstanding Right Certificates”; (ii) all rights that have been redeemed pursuant to Section 23 hereof, and upon such
occurrence, all Right Certificates therefor shall represent only the right to receive the consideration provided in Section 23 hereof and shall not be deemed “outstanding Right Certificates”, and (iii) any Rights that have been exchanged
pursuant to Section 24 hereof, and upon such occurrence, all Right Certificates therefor shall represent only the right to receive the consideration provided in Section 24 and shall not be deemed “outstanding Right Certificates”.

  
 (p) “Shares Acquisition Date” shall mean the earlier of the date of (i)
the public announcement by the Company or an Acquiring Person that an Acquiring Person has become such or (ii) the public disclosure of facts by the Company or an Acquiring Person indicating that an Acquiring Person has become such. 

 
 (q) “Subsidiary” of any Person shall mean any Person of which a majority of the voting
power of the voting equity securities or equity interest is owned, directly or indirectly, by such Person. 
  
 (r) A “Successor” shall mean the estate or legal representative of a deceased individual, the beneficiary of a deceased individual’s estate, a trust created by a deceased individual as grantor, or the
beneficiary of a trust created by a deceased individual as grantor. 
  
 (s) “Void
Rights” shall have the meaning set forth in Section 7(f). 
  
 
Section 2.    Appointment of Rights Agent.    The Company hereby appoints the Rights Agent to act as agent for the Company in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such co-Rights Agents as it may deem necessary or desirable upon ten days’ prior written notice to the Rights Agent. The Rights Agent shall
have no duty to supervise, and shall in no event be liable for, the acts or omissions of any such co-Rights Agent. 

 
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Section 3.    Evidence of Rights Before Distribution Date; Transfer; Legends. 
  
 (a)  From the Record Date until the earliest of the Distribution Date, the Redemption Date or the Final Expiration Date, (x) Rights will be evidenced by the certificates for Common Shares registered in the names of
the holders thereof (which certificates shall also be deemed to be Right Certificates) and not by separate Right Certificates (as defined below), and (y) Rights will be transferable only in connection with the transfer of Common Shares. On the
Record Date, or as soon as practicable thereafter, the Company will send a copy of a Summary of Stock Purchase Rights, in substantially the form of Exhibit B hereto (the “Summary of Rights”), by first-class,
postage-prepaid mail, to each record holder of Common Shares as of the Close of Business on the Record Date, at the address of such holder shown on the records of the Company. Until the earliest of the Distribution Date, the Redemption Date or the
Final Expiration Date, the surrender for transfer of any certificate for Common Shares outstanding on the Record Date, with or without a copy of the Summary of Rights attached thereto, shall also constitute the surrender for transfer of the Rights
associated with the Common Shares represented thereby. 
  
 (b)  Certificates for Common Shares that become
outstanding (including, without limitation, reacquired Common Shares referred to in the last sentence of this Section 3(b)) after the Record Date but prior to the earliest of the Distribution Date, the Redemption Date or the Final Expiration Date
shall have impressed on, printed on, written on or otherwise affixed to them the following legend: 
  
 THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS (THE “RIGHTS”) AS SET FORTH IN A RIGHTS AGREEMENT BETWEEN KEYNOTE SYSTEMS, INC. (THE “COMPANY”) AND AMERICAN
STOCK TRANSFER & TRUST COMPANY, AS RIGHTS AGENT, DATED AS OF OCTOBER 25, 2002, AS SUCH MAY SUBSEQUENTLY BE AMENDED (THE “RIGHTS AGREEMENT”), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCE AND A COPY
OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, SUCH RIGHTS WILL BE EVIDENCED BY SEPARATE CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS CERTIFICATE. THE
COMPANY WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR. AS DESCRIBED IN SECTION 7(F) OF THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO BECOMES
AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN OTHER PERSONS SHALL BECOME NULL AND VOID. 
  
 In the event that the
Company purchases or acquires any Common Shares after the Record Date but prior to the Distribution Date, any Rights associated with such Common Shares shall be deemed cancelled and retired so that the Company shall not be entitled to exercise any
Rights associated with the Common Shares that are no longer outstanding. 

 
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Section 4.     Evidence of Rights After Distribution Date; Form of Right Certificates; Countersignatures. 
  
 (a) From and after the Distribution Date until the earlier of the Redemption Date or the Final Expiration Date, Rights will be evidenced solely by Right Certificates that,
together with the forms of election to purchase Preferred Shares and of assignment to be printed on the reverse thereof, shall be substantially in the form set forth as Exhibit C hereto (each, a “Right Certificate”),
which may have such marks of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deem appropriate and which do not affect the rights, duties or responsibilities of the Rights Agent 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 other provisions of this Agreement, the Right Certificates shall entitle the holders thereof to purchase such number of one one-hundredths of a Preferred Share as shall be set forth
therein at the Purchase Price, but the number of such one one-hundredths of a Preferred Share and the Purchase Price shall be subject to adjustment as provided herein. 
  
 (b) The Right Certificates shall be executed on behalf of the Company by its Chairman of the Board, its Chief Executive Officer, its President, any of its Vice Presidents,
or its Treasurer, either manually or by facsimile signature, shall have affixed thereto the Company’s seal or a facsimile thereof, and shall be attested by the Secretary or any Assistant Secretary of the Company, either manually or by facsimile
signature. The Right Certificates shall be manually countersigned by the Rights Agent (unless applicable exchange rules and law permit facsimile signature, in which case the Rights Agent signature may be by facsimile) and shall not be valid for any
purpose unless countersigned. In case any officer of the Company who shall have signed any of the Right Certificates shall cease to be such officer of the Company before countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect as though the individual who signed such Right Certificates had not ceased to be such officer of
the Company; and any Right Certificate may be signed on behalf of the Company by any individual who, at the actual date of the execution of such Right Certificate, shall be a proper officer of the Company to sign such Right Certificate, although at
the date of the execution of this Rights Agreement any such individual was not such an officer. 
  
 
Section 5.    Distribution of Certificates; Registration. 
  
 (a) As soon as practicable after the Distribution Date (and so long as the Redemption Date and the Final Expiration Date shall not have occurred), the Company will prepare and execute, the Rights Agent will countersign and the
Company will send or cause to be sent (and the Rights Agent will, if requested and provided with all necessary information, send) by first-class, insured, postage-prepaid mail to each record holder of Common Shares as of the Close of Business on the
Distribution Date (other than the holder of Void Rights (as defined in Section 7(f) hereof), at the address of such holder shown on the records of the Company, Rights Certificates evidencing one Right for each Common Share so held. 

 
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 (b)  Following the Distribution Date and receipt by the Rights agent of all relevant information, the Rights
Agent will keep or cause to be kept, at its office, books for registration and transfer of the Right Certificates issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates and the date of each of the Right Certificates. 
  
 
Section 6.    Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. 
  

(a)  Subject to the provisions of 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 earlier of the Redemption Date or the Final Expiration Date, any Right Certificate or Right Certificates (other than Right Certificates representing Void Rights or Rights that have been exchanged pursuant to Section 24 hereof) may be
transferred, split up, combined or exchanged for another Right Certificate or Right Certificates, entitling the registered holder to purchase a like number of one one-hundredths of a Preferred Share as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder desiring to transfer, split up, combine or exchange any Right Certificate or Right Certificates shall make such request in writing delivered to the Rights Agent, and shall
surrender the Right Certificate or Right Certificates to be transferred, split up, combined or exchanged at the office of the Rights Agent. Thereupon the Company shall execute and the Rights Agent shall countersign and deliver to the Person entitled
thereto a Right Certificate or Right Certificates, as the case may be, as so requested. The Company may require payment of a sum sufficient for all taxes and governmental charges that may be imposed in connection with any transfer, split up,
combination or exchange of Right Certificates. The Rights Agent shall have no duty or obligation under this Section 6 unless and until it is satisfied that all such taxes and/or charges have been paid. 
  
 (b)  Upon receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Right Certificate, and, at the Company’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and, (i) in case of loss, theft or destruction, of indemnity or
security satisfactory to them, or (ii) in the case of mutilation, upon surrender to the Rights Agent and cancellation of the Right Certificate, then, in either such case, the Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated. 
  
 
Section 7.    Exercise of Rights; Purchase Price; Expiration Date; Void Rights. 
  
 (a)  The registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein) in whole or in part at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on the reverse side thereof duly executed, to the Rights Agent at the office of the Rights Agent, together with payment of the Purchase Price for each one one-hundredth of a Preferred Share as
to which the Rights are exercised and payment of all transfer taxes and governmental charges required to be paid by the holder of such Right Certificate as provided in Section 9 hereof, at or prior to the earliest of (i) the Close of Business on
October 29, 2012 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the

 
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“Redemption Date”), or (iii) the time at which such Rights are exchanged as provided in Section 24 hereof. 
  
 (b) The purchase price for each one one-hundredth of a Preferred Share pursuant to the exercise of a Right (the “Purchase Price”) shall initially be
$60.00, shall be subject to adjustment from time to time as provided in Sections 11 and 13 hereof and shall be payable in lawful money of the United States of America in accordance with Section 7(c) hereof. 
  
 (c) Upon receipt of a Right Certificate representing exercisable Rights within the time permitted in Section 7(a), with the form of
election to purchase and certificate duly executed, accompanied by payment of the Purchase Price for the shares to be purchased and an amount equal to all applicable taxes and governmental charges required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check, cashier’s check or money order payable to the order of the Company, the Rights Agent shall promptly (i)(A) requisition from any transfer agent of the Preferred Shares
certificates for the number of one-one hundredths of a Preferred Share to be purchased, and the Company hereby irrevocably authorizes its transfer agent to comply with all such requests, or (B) requisition from any depositary agent for the Preferred
Shares depositary receipts representing such number of one one-hundredths of a Preferred Share as are to be purchased (in which case certificates for the Preferred Shares represented by such receipts shall be deposited by the transfer agent with the
depositary agent), and the Company hereby directs the depositary agent to comply with all such requests, (ii) when appropriate, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional Preferred 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 Right Certificate, registered in such name or names as may be
designated by such holder and (iv) when appropriate, after receipt, deliver such cash to or upon the order of the registered holder of such Right Certificate. 
  
 (d) In case the registered holder of any Right Certificate shall exercise less than all the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent to the registered holder of such Right Certificate or to such holder’s duly authorized assigns, subject to the provisions of Section 6 and Section 14 hereof. 
  
 (e) The Company covenants and agrees that it will cause to be reserved and kept available, out of its authorized and unissued Preferred
Shares or any Preferred Shares held in its treasury, the number of Preferred Shares that will be sufficient to permit the exercise in full of all Rights in accordance with this Section 7. 
  
 (f) From and after the time that any Person becomes an Acquiring Person, (i) all Rights that are or were acquired or beneficially owned by such Acquiring Person (and all
Rights that are or were acquired or beneficially owned by each Associate and by each Affiliate of such Acquiring Person) shall be null and void without any further action on the part of the Company, the Rights Agent or any other Person (all such
Rights, “Void Rights”) and (ii) any holder thereof shall thereafter have no right to exercise such Void Rights under any provision of this Agreement. No Right Certificate shall be issued pursuant to Sections 5 or 6 that
represents Rights beneficially owned by an Acquiring Person whose Rights have become Void Rights pursuant to the preceding sentence or by any Associate or Affiliate thereof; no Right Certificate
 

 
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shall be issued at any time upon the transfer of any Rights to an Acquiring Person whose Rights have become Void Rights pursuant to the preceding sentence or to any Associate or Affiliate thereof
or to any nominee of such Acquiring Person, Associate or Affiliate; and any Right Certificate delivered to the Rights Agent for transfer to an Acquiring Person whose Rights have become Void Rights pursuant to the preceding sentence or for transfer
to any Associate or Affiliate thereof shall be cancelled. This Section 7(f) shall apply not only to an initial Acquiring Person, and each of its Affiliates and Associates, but also to all subsequent Acquiring Persons, and each of their Affiliates
and Associates. 
  
 (g)  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) properly completed and
signed the certificate following the form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such exercise and (ii) provided such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights agent shall reasonably request. 
  
 
Section 8.    Cancellation and Destruction of Right Certificates.    All Right Certificates surrendered for the purpose of exercise, transfer, split up, combination or
exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled by it, and no Right Certificates shall be
issued in lieu thereof except as expressly permitted by any of the provisions of this Rights Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall cancel and retire, any other Right
Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all cancelled Right Certificates to the Company, or shall, at the written request of the Company, destroy such cancelled Right
Certificates, and in such case shall deliver a certificate of destruction thereof to the Company. 
  
 
Section 9.    Status and Availability of Preferred Shares.    The Company covenants and agrees that it will take all such action as may be necessary to ensure that all
Preferred Shares delivered upon valid exercise of Rights in compliance with Section 7 shall, at the time of delivery of the certificates for such Preferred Shares (subject to payment of the Purchase Price), be duly and validly authorized and issued
and fully paid and non-assessable shares. 
  
 The Company further covenants and agrees that it will pay when due and
payable any and all taxes and governmental charges that may be payable in respect of the issuance or delivery of the Right Certificates or of any Preferred Shares upon the exercise of Rights. The Company shall not, however, be required (i) to pay
any tax or governmental charge that may be payable in respect of any transfer or delivery of Right Certificates to a Person other than, or the issuance or delivery of certificates or depositary receipts for the Preferred Shares in a name other than
that of, the registered holder of the Right Certificate evidencing Rights surrendered for exercise or to issue or (ii) to deliver any certificates or depositary receipts for Preferred Shares upon the exercise of any Rights until all such taxes and
governmental charges shall have been paid (all such taxes and governmental charges being payable by the holder of such Right Certificate at the time of surrender for exercise) or until it has been established to the Company’s reasonable
satisfaction that no such tax or governmental charge is due. 

 
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Section 10.    Preferred Shares Record Date.    Each Person in whose name any certificate for Preferred Shares is issued upon the valid exercise of Rights shall for all
purposes be deemed to have become the holder of record of the Preferred Shares represented thereby on, and such certificate shall be dated, the date upon which the Right Certificate evidencing such Rights was duly surrendered and payment of the
Purchase Price (and any applicable taxes and governmental charges) was made. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate shall not be entitled to any rights of a holder of Preferred Shares for which the
Rights shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company,
except as provided herein. 
  
 
Section 11.    Adjustment of Purchase Price, Number of Shares or Number of Rights.    The Purchase Price, the number of Preferred Shares covered by each Right and the
number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11, provided, however, that no adjustment, payment or distribution of securities or other change in the Rights or securities issuable
upon exercise of any Rights as provided in this Section 11 shall apply to any Void Rights. 
  
 (a)  (i)  In the event the Company shall at any time after the date of this Agreement (A) declare a dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide the outstanding Preferred Shares, (C)
combine the outstanding Preferred Shares into a smaller number of Preferred Shares or (D) issue any shares of its capital stock in a reclassification of the Preferred Shares (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except as otherwise provided in this Section 11(a), the Purchase Price in effect at the time of the record date for such dividend or of the effective date of such dividend,
subdivision, combination or reclassification, and the number and kind of shares of capital stock that would be issuable upon exercise of a Right on such date (if such Rights were then exercisable), shall be proportionately adjusted so that the
holder of any Right exercised after such time shall be entitled to receive the aggregate number and kind of shares of capital stock that, if such Right had been exercised immediately prior to such date, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification; provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the
aggregate par value of the shares of the class or series of capital stock of the Company issuable upon exercise of one Right. 
  
 (ii)  Subject to Section 7(f) and Section 24 of this Agreement, in the event that any Person shall become an Acquiring Person, unless the event causing the Designated Percentage threshold to be crossed and the Person to
thereby become an Acquiring Person is a transaction set forth in Section 13 hereof, each holder of a Right shall thereafter have a right to receive, upon exercise of such Right at a price equal to the then current Purchase Price multiplied by the
number of one one-hundredths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of Preferred Shares, such number of Common Shares of the Company as shall equal the result obtained
by (x) multiplying the then current Purchase Price by the number of one one-hundredths of a Preferred Share for which a Right is then exercisable and dividing that product by (y) 50% of the then current per share market price of the Company’s
Common Shares (determined pursuant to Section 11(d) hereof) on the date such Person became an Acquiring Person. 

 
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 (iii) In the event that the number of Common Shares that are
authorized by the Company’s certificate of incorporation and not outstanding or subscribed for, or reserved or otherwise committed for issuance for purposes other than upon exercise of the Rights, is not sufficient to permit the holder of each
Right to purchase the number of Common Shares to which such holder would be entitled upon the exercise in full of the Rights in accordance with Section 11(a)(ii), the Company shall: (A) determine the excess of (1) the value of the Common Shares
issuable upon the exercise of a Right (calculated as provided in the last sentence of this Section 11(a)(iii)) pursuant to Section 11(a)(ii) hereof (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 such Common Shares, upon payment of the applicable Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3) Common Shares or
other equity securities of the Company (including, without limitation, shares of the Company’s Preferred Stock, or units of shares of the Company’s capital stock) that the Board of Directors of the Company has determined to have the same
value as Common Shares (such equity securities, “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 in good faith; provided, however, if the Company shall not have made adequate provision to deliver value pursuant to clause (B) of this paragraph
within thirty (30) days following the first occurrence of an event triggering the rights to purchase Common Shares described in Section 11(a)(ii) (the “Section 11(a)(ii) Trigger Date”), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right without requiring payment of the Purchase Price, Common Shares (to the extent available) and then, if necessary, cash, which shares and 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 Common Shares 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 needs to 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(g) hereof, that such action shall apply uniformly to all Rights, and (y) may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek any authorization of additional shares and/or
to decide the appropriate form of distribution to be made pursuant to such first sentence and to determine the value thereof. In the event of any such suspension, the Company shall make a public announcement, and shall deliver to the Rights Agent a
statement, stating that the exercisability of the Rights has been temporarily suspended. At such time as the suspension is no longer in effect, the Company shall make another public announcement, and deliver to the Rights Agent a statement, so
stating. For purposes of this Section 11(a)(iii), the value of the Common Shares shall be the current per share market price (as determined pursuant to Section 11(d)(i) hereof) of the Common Shares 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 Shares on such date. 
  
 (b) In case the Company shall fix a record date for the issuance of rights, options or warrants to all holders of Preferred Shares entitling them to subscribe for or purchase Preferred Shares (or shares having the same
rights, privileges and preferences as the
 

 
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Preferred Shares (“equivalent preferred shares”)) or securities convertible into Preferred Shares or equivalent preferred shares at a price per Preferred Share or
equivalent preferred share (or having a conversion price per share, if a security convertible into Preferred Shares or equivalent preferred shares) less than the then current per share market price of the Preferred Shares (as defined in Section
11(d)) on such record date, the Purchase Price to be in effect after such record date shall be determined by multiplying (x) the Purchase Price in effect immediately prior to such record date by (y) a fraction, (1) the numerator of which shall be
the sum of (A) number of Preferred Shares outstanding on such record date plus (B) the number of Preferred Shares that the aggregate offering price of the total number of Preferred Shares and/or equivalent preferred shares so to be offered (and/or
the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such current market price and (2) the denominator of which shall be the sum of (A) number of Preferred Shares outstanding on such record date
plus (B) the number of additional Preferred Shares and/or equivalent preferred shares to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible); provided, however,
that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the class or series of shares of capital stock of the Company issuable upon exercise of one Right. In case such subscription
price may be paid in a consideration part or all of which shall 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 conclusive for all purposes. Preferred Shares owned by or held for the account of the Company shall not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and in the event that such rights, options or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price that would then be in effect if such record date had not been
fixed. 
  
 (c) In case the Company shall fix a record date for the making of a distribution to all
holders of the Preferred Shares (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation) of evidences of indebtedness or assets (other than a regular
quarterly cash dividend or a dividend payable in Preferred Shares) or subscription rights or warrants (excluding those referred to in Section 11(b) hereof), the Purchase Price to be in effect after such record date shall be determined by multiplying
(x) the Purchase Price in effect immediately prior to such record date by (y) a fraction, (1) the numerator of which shall be the difference of (A) then current per share market price of the Preferred Shares on such record date, less (B) 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 and shall be conclusive for all purposes) of the portion of the assets or evidences
of indebtedness so to be distributed or of such subscription rights or warrants applicable to one Preferred Share and (2) the denominator of which shall be such current per share market price of the Preferred Shares; provided, however,
that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the class or series of shares of capital stock of the Company to be issued upon exercise of one Right. Such adjustments shall
be made successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Purchase Price shall again be adjusted to be the Purchase Price that would then be in effect if such record date had not been
fixed. 

 
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 (d)  (i)  For the purpose of any computation
hereunder, the “current per share market price” of any security (a “Security” for the purpose of this Section 11(d)(i)) on any date shall be deemed to be the average of the daily closing prices per
share of such Security for the 30 consecutive Trading Days (as such term is hereinafter defined) immediately prior to such date; provided, however, that in the event that the current per share market price of the Security is determined
during a period following the announcement by the issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such Security or securities convertible into such shares, or (B) any subdivision, combination or
reclassification of such Security and prior to the expiration of 30 Trading Days 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 per share market price shall be appropriately adjusted to reflect the current market price per share equivalent of such Security. The closing price for each day shall be the last sale price, regular way, or, in case no such sale takes place
on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange
or, if the Security is not listed or admitted to trading on the New York Stock Exchange, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which
the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange, the last quoted price, or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by The Nasdaq Stock Market (“Nasdaq”) or such other system then in use, or, if on any such date the Security is not quoted by any such organization, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in the Security selected by the Board of Directors of the Company. The term “Trading Day” shall mean a day on which the principal national securities
exchange on which the Security is listed or admitted to trading is open for the transaction of business or, if the Security is not listed or admitted to trading on any national securities exchange, a Business Day. 
  
 (ii)  For the purpose of any computation hereunder, the “current per share market price” of the
Preferred Shares shall be determined in accordance with the method set forth in Section 11(d)(i). If the Preferred Shares are not publicly traded, the “current per share market price” of the Preferred Shares shall be conclusively deemed to
be the current per share market price of the Common Shares as determined pursuant to Section 11(d)(i) (appropriately adjusted to reflect each stock split, stock combination, stock dividend or similar transaction occurring after the date hereof),
multiplied by one hundred. If neither the Common Shares nor the Preferred Shares are publicly held or so listed or traded, “current per share market price” shall mean the fair value per share thereof 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. 
  
 (e)  No adjustment in the Purchase Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the
Purchase Price; provided, however, that any adjustments that 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 one one-millionth of a Preferred Share or one one-thousandth of any other share or security as the case may be. Notwithstanding the first sentence of this Section 11(e), any adjustment required
by this Section
 

 
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11 shall be made no later than three years from the date of the transaction that, but for such sentence of this Section 11(e), would have required such adjustment. 
  
 (f) If as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock of the Company other than Preferred Shares, the number of such other shares so receivable upon exercise of any Right shall thereafter be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares contained in Section 11(a) through (c), inclusive, and the provisions of Sections 7, 9, 10 and 13 with respect to the Preferred Shares shall
apply on like terms to any such other shares. 
  
 (g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the number of one one-hundredths of a Preferred Share purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein. 
  
 (h) Unless the Company shall
have exercised its election as provided in Section 11(i), upon each adjustment of the Purchase Price as a result of the calculations made in Sections 11(b) and (c), each Right outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase Price, that number of one one-hundredths of a Preferred Share (calculated to the nearest one one-millionth of a Preferred Share) obtained by (i) multiplying (x) the number of one
one-hundredths of a share covered by a Right immediately prior to this adjustment 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 substitution for any adjustment in the number of one one-hundredths of a Preferred Share purchasable upon the exercise of a Right. Each of the Rights
outstanding after such adjustment of the number of Rights shall be exercisable for the number of one one-hundredths of a Preferred Share for which a Right was exercisable immediately prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights and outstanding thereafter shall become that number of Rights (calculated to the nearest one one-thousandth) obtained by dividing (x) the Purchase Price in effect immediately prior to adjustment of the Purchase
Price by (y) the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement (with prompt notice thereof to the Rights Agent) of its election to adjust the number of Rights, indicating
the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Right Certificates have been
distributed, shall be at least ten days later than the date of the public announcement. If Right Certificates have been distributed, upon each adjustment of the number of Rights pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right Certificates on such record date, Right Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment, and
 

 
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upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment. Right Certificates to be so
distributed shall be issued, executed and countersigned in the manner provided for herein and shall be registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement. 

 
 (j)  Irrespective of any adjustment or change in the Purchase Price or the number of one
one-hundredths of a Preferred Share issuable upon the exercise of the Rights, the Right Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of one one-hundredths of a Preferred Share that were
expressed in the initial Right Certificates issued hereunder. 
  
 (k)  Before taking any
action that would cause an adjustment reducing the Purchase Price below one one-hundredth of the then par value of the Preferred Shares issuable upon exercise of the Rights, the Company shall take any corporate action that may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue fully paid and non-assessable Preferred Shares at such adjusted Purchase Price. 
  
 (l)  In any case in which this Section 11 shall require that an adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer (and shall promptly notify the Rights Agent of any such elections), until the occurrence of such event, the issuing to the holder of any Right exercised after such record date, the additional Preferred
Shares and other capital stock or securities of the Company, if any, issuable upon such exercise over and above the Preferred Shares and other capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder’s right to receive such additional shares upon
the occurrence of the event requiring such adjustment. 
  
 (m)  Anything in this Section 11
to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that it in its sole discretion shall determine
to be advisable in order that any (i) subdivision, combination or consolidation of the Preferred Shares, (ii) issuance wholly for cash of Preferred Shares or securities that by their terms are convertible into or exchangeable for Preferred Shares,
(iii) dividends on Preferred Shares payable in Preferred Shares or (iv) issuance of any rights, options or warrants referred to hereinabove in Section 11(b), hereafter made by the Company to holders of its Preferred Shares shall not be taxable to
such stockholders. 
  
 (n)  In the event that at any time after the date of this Agreement,
the Company shall (i) declare or pay any dividend on the Common Shares payable in Common Shares or (ii) effect a subdivision, combination or consolidation of the Common Shares (by reclassification or otherwise other than by payment of dividends in
Common Shares) into a greater or lesser number of Common Shares, then in any such case (i) the number of one one-hundredths of a Preferred Share purchasable after such event upon proper exercise of each Right shall be determined by multiplying (x)
the number of one one-hundredths of a Preferred Share so purchasable immediately prior to such event by (y) a fraction, (1) the numerator of which is the number of Common Shares outstanding immediately before such event and (2) the denominator of
which is 

 
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the number of Common Shares outstanding immediately after such event, and (ii) each Common Share outstanding immediately after such event shall have issued with respect to it that number of
Rights that each Common Share outstanding immediately prior to such event had issued with respect to it. The adjustments provided for in this Section 11(n) shall be made successively whenever such a dividend is declared or paid or such a
subdivision, combination or consolidation is effected. 
  
 (o) The Company covenants and agrees that,
after the Distribution Date, it will not, except as permitted by Sections 23, 24 and 27, take (or permit any Subsidiary to take) any action if the purpose of such action is to, or if at the time such action is taken it is reasonably foreseeable that
such action will, diminish substantially or eliminate the benefits intended to be afforded by the Rights. 
  
 
Section 12.    Certificate of Adjusted Purchase Price or Number of Shares.    Whenever an adjustment is made as provided in Sections 11 or 13 hereof, the Company shall
promptly (a) prepare a certificate setting forth such adjustment, and a brief statement of the facts and computations accounting for such adjustment, (b) file with the Rights Agent and with each transfer agent for the Common Shares or the Preferred
Shares a copy of such certificate and (c) mail a brief summary thereof to each holder of a Right Certificate in accordance with Section 25 hereof. The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment
therein contained and shall have no duty with respect to and shall not be deemed to have knowledge of any adjustment unless and until it shall have received such certificate. 
  
 
Section 13.    Consolidation, Merger or Sale or Transfer of Assets or Earning Power.    In the event that any Person shall become an Acquiring Person, and, directly or
indirectly, (a) the Company shall consolidate with, or merge with and into, an Acquiring Person, or an Affiliate or Associate of an Acquiring Person, (b) an Acquiring Person, or an Affiliate or Associate of an Acquiring Person, shall consolidate
with the Company, or merge with and into the Company and the Company shall be the continuing or surviving corporation of such merger and, in connection with such merger, all or part of the Common Shares shall be changed into or exchanged for stock
or other securities of any other Person (or the Company) or cash or any other property, or (c) the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets or
earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to an Acquiring Person, or an Affiliate or Associate of an Acquiring Person, then, and in each such case, proper provision
shall be made so that (i) each holder of a Right (other than Rights that have become Void Rights) shall thereafter have the right to receive, upon the exercise thereof at a price equal to the then current Purchase Price multiplied by the number of
one one-hundredths of a Preferred Share for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of Preferred Shares, such number of Common Shares of the Person in the transaction (including the Company as
successor thereto or as the surviving corporation) who is issuing the consideration with the greatest fair market value to the Company and its stockholders in connection with such transaction (the “Principal Issuer”) as shall
equal the result obtained by (A) multiplying the then current Purchase Price by the number of one one-hundredths of a Preferred Share for which a Right is then exercisable and dividing that product by (B) 50% of the then current per share market
price of the Common Shares of the Principal Issuer (determined pursuant to Section 11(d) hereof) on the date of consummation of such consolidation, merger, sale or transfer; (ii) the Principal Issuer shall be liable for, and shall assume, by virtue
of such

 
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 consolidation, merger, sale or transfer, all the obligations and duties of the Company pursuant to this Agreement; (iii) the term
“Company” shall thereafter be deemed to refer to the Principal Issuer; and (iv) the Principal Issuer shall take such steps (including, but not limited to, the reservation of a sufficient number of its Common Shares in accordance with
Section 9 hereof) in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to the Common Shares thereafter deliverable upon the exercise
of the Rights. The Company covenants and agrees that it shall not consummate any such consolidation, merger, sale or transfer unless prior thereto the Company and the Principal Issuer shall have executed and delivered to the Rights Agent a
supplemental agreement so providing. The Company shall not enter into any transaction of the kind referred to in this Section 13 if at the time of such transaction there are any rights, warrants, instruments or securities outstanding or any
agreements or arrangements that, as a result of the consummation of such transaction, would eliminate or substantially diminish the benefits intended to be afforded by the Rights. The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers. 
  
 
Section 14.    Fractional Rights and Fractional Shares. 
  
 (a)  The Company shall not be required to issue fractions of Rights or to distribute Right Certificates that evidence fractional Rights. In lieu of such fractional Rights, there shall be paid to the registered holders of
the Right Certificates with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole Right. For the purposes of this Section 14(a), the current market
value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted
to trading on the 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 Preferred Shares (other than fractions that are integral multiples of one one-hundredth of a Preferred Share) upon exercise of the Rights or to distribute certificates that evidence fractional Preferred Shares
(other than fractions that are integral multiples of one one-hundredth of a Preferred Share). Fractions of Preferred Shares in integral multiples of one one-hundredth of a Preferred Share may, at the election of the Company, be evidenced by
depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it; provided, that such agreement

 
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shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences to which they are entitled as beneficial owners of the Preferred Shares
represented by such depositary receipts. In lieu of fractional Preferred Shares that are not integral multiples of one one-hundredth of a Preferred Share, the Company shall pay to the registered holders of Right Certificates at the time such Rights
are exercised as herein provided an amount in cash equal to the same fractions of the current market value of one Preferred Share. For the purposes of this Section 14(b), the current market value of a Preferred Share shall be the closing price of a
Preferred Share (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of such exercise. 
  
 (c) The holder of a Right by the acceptance of the Right expressly waives any right to receive fractional Rights or fractional shares upon exercise of a Right (except as provided above). 

 
 
Section 15. Rights of Action. All rights of action in respect of this Agreement, excepting the rights of action of the Rights Agent and the Company, are vested in the respective registered holders of the
Rights; and any registered holder of any Right may, without the consent of the Rights Agent or of the holder of any other Right, in such holder’s own behalf and for such holder’s own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or otherwise act in respect of, such holder’s right to exercise the Rights in the manner provided in this Agreement and in any issued and outstanding Right Certificate representing such
Right. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach of this Agreement and will be entitled to
specific performance of the obligations under, and injunctive relief against actual or threatened violations of the obligations of any Person subject to, this Agreement. 
  
 
Section 16. Agreement of Right Holders. Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other holder of a Right that: 

 
 (a) prior to the Distribution Date, the Rights will be transferable only in connection with the transfer of the
Common Shares; 
  
 (b) after the Distribution Date, the Right Certificates are transferable only on
the registry books maintained by the Rights Agent if surrendered at the office of the Rights Agent, duly endorsed or accompanied by a proper instrument of transfer and payment of taxes and governmental changes, all as otherwise provided in Section
6; and 
  
 (c) the Company and the Rights Agent shall deem and treat the Person in whose name the
Right Certificate (or, prior to the Distribution Date, the associated Common Shares certificate) is registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right
Certificates or the associated Common Shares certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent shall be affected by any notice (other than notice provided
by transfer documentation properly completed and tendered in accordance with this Agreement) to the contrary. 

 
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 (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 failure to perform any of its obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree, judgment or ruling (whether interlocutory final) issued by a court of competent jurisdiction or by a governmental, regulatory or administrative agency or commission, or any statute, rule, regulation or executive
order promulgated or enacted by any governmental authority prohibiting or otherwise restraining performance of such obligation. 
  
 
Section 17.    Right Certificate Holder Not Deemed a Stockholder.    No holder, as such, of any Right shall be entitled to vote, receive dividends or be deemed for any
purpose the holder of the Preferred Shares or any other securities of the Company that may at any time be issuable on the exercise of such Rights nor shall anything contained herein or in any Right Certificate be construed to confer upon the holder
of any Rights, 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 25 hereof), or to receive dividends or subscription rights, or otherwise, until such Right shall have been properly exercised in accordance with
the provisions hereof. 
  
 
Section 18.    Compensation and Indemnity of the Rights Agent.    (a) The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and other disbursements incurred in the preparation, delivery, amendment, administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the Rights Agent (including employees, directors, officers and agents of the Rights Agent (the Rights Agent together with such Persons, the “Agent
Indemnitees”)) for, and to hold each Agent Indemnitee harmless against, any loss, liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense (each an “Agent Loss”), incurred on the
part of such Agent Indemnitee for any action taken, suffered or omitted by any of the Agent Indemnitees 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, provided, however, that the Company shall not be required to indemnify any Agent Indemnitee hereunder for any Agent Loss that resulted from any action taken, suffered or omitted by the Agent Indemnitee in bad faith or
through gross negligence or willful misconduct of the Rights Agent or any other Agent Indemnity, as each is finally determined by a court of competent jurisdiction, and the respective Agent Indemnitee shall promptly refund to the Company all sums
advanced to such Agent Indemnitee as or against indemnification for Agent Losses upon such judicial determination. If an Agent Indemnitee brings an action to enforce its right to indemnification under this Section 18, the Company shall pay the costs
of such action to the extent that such Agent Indemnitee is a prevailing party in such litigation. Anything to the contrary notwithstanding, in no event shall any Agent Indemnitee be liable for special, punitive, indirect, consequential or incidental
loss or damage of any kind whatsoever (including but not limited to lost profits), even if such Agent Indemnitee has been advised of the likelihood of such loss or damage. Any liability of an Agent Indemnitee under this Rights Agreement will be
limited to the amount of fees paid by the Company to the Rights Agent. The provisions of this Section 18 and Section 20 below shall survive the termination of this Agreement, the exercise or expiration of the Rights and the resignation or removal of
the Rights Agent. 

 
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 (b)  The Rights Agent shall be authorized to rely on, shall be
protected and shall incur no liability for or in respect of any action taken, suffered or omitted by it in connection with the acceptance and administration of this Agreement or the exercise or performance of its duties hereunder in reliance upon
any Right 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, instruction, 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. 
  
 
Section 19.    Merger or Consolidation or Change of Name of Rights Agent.    Any Person into which the Rights Agent or any successor Rights Agent may be merged or with
which it may be consolidated, or any Person resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the shareholder service business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such Person would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21 hereof. In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement any of the Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases such Right Certificates shall have the full
force provided in the Right Certificates and in this Agreement. 
  
 In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right Certificates shall have been countersigned but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver Right Certificates so countersigned; and in case at
that time any of the Right Certificates shall not have been countersigned, the Rights Agent may countersign such Right Certificates either in its prior name or in its changed name; and in all such cases such Right Certificates shall have the full
force provided in the Right Certificates and in this Agreement. 
  
 
Section 20.    Rights and Duties of Rights Agent.    The Rights Agent undertakes only the duties and obligations expressly imposed by this Agreement upon the following
terms and conditions, by all of which the Company and, by their acceptance of Rights, the holders of Rights shall be bound: 
  
 (a)  The Rights Agent may consult with legal counsel (who may be legal counsel for the Company), and the advice or opinion of such counsel shall be full and complete authorization and
protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted by it in good faith and in accordance with such advice or opinion. 
  
 (b)  Whenever in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior to taking, suffering or omitting any action hereunder, such fact or matter

 
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(unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by any one of the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the General Counsel, the Treasurer or the Secretary of the Company and delivered to the Rights Agent; and such certificate shall be full authorization and protection to the
Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitting 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 bad faith, gross negligence or willful misconduct as
finally determined by a court of competent jurisdiction. The Rights Agent makes no representation or warranty with respect to and is not responsible or liable for the validity, value or availability of the Rights, the Right Certificates or the
Preferred Shares. 
  
 (d) The Rights Agent shall be protected and shall incur no liability for any
action taken, suffered or omitted by it in connection with, its administration of this Agreement in reliance upon any Right Certificate or certificate for the Common Shares or for other securities of the Company, instrument of assignment or
transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper or document believed by it to be genuine and to be signed, executed and, where necessary, verified or acknowledged, by the
proper Person or Persons, or otherwise upon the advice or opinion of counsel as set forth in this Section 20. 
  
 (e) The Rights Agent shall not be assumed to have knowledge of and shall not be required to take note of or act upon any fact or circumstance including, without limitation, the occurrence of facts or circumstances leading to the
Shares Acquisition Date or the Distribution Date, facts or circumstances relating to whether any Person may be an Affiliate or an Associate of any other Person, facts or circumstances relevant to an adjustment to the Purchase Price, facts or
circumstances relevant to events described in Section 13 (mergers, etc.), Section 23 (redemption) and Section 24 (exchange) that may be relevant to performance by the Rights Agent under this Agreement unless the Company has provided written notice
thereof to the Rights Agent; and the Company agrees that it will (i) promptly notify the Rights Agent in writing of the occurrence of the Shares Acquisition Date (including the identity of the Acquiring Person and the date on which the Shares
Acquisition Date occurred), the Distribution Date, the Redemption Date, and of any events described in Section 13 (merger), and (ii) promptly provide the Rights Agent with such other information as the Rights Agent may reasonably request in
connection with the performance of its duties under this Agreement. 
  
 (f) The Rights Agent shall
not have any liability for or be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due authorization and execution hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Right Certificate; nor shall it be responsible for
any change in the exercisability of the Rights (including the Rights becoming null and void pursuant to Section 7(f) hereof) or any change or adjustment in the terms of the Rights (including the manner, method or amount thereof) provided for in
Section 3, 11, 13, 23 or 24, or the ascertaining of the existence of facts that would require any such change or adjustment (except with respect to the exercise of
 

 
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Rights evidenced by Right Certificates after receipt of the certificate described in Section 12 hereof, upon which the Rights Agent may rely); nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any Preferred Shares will, when issued, be validly authorized and issued, fully paid and nonassessable. 
  
 (g) 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. 
  

(h) The Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from any one of
the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the General Counsel, the Secretary or the Treasurer of the Company, and to apply to such officers for advice or instructions in connection with its duties,
and it shall not be liable for any action taken or suffered by it in good faith in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions. Any application by the Rights Agent for written
instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken or omitted by the Rights Agent with respect to its duties or obligations under this Rights Agreement and the date on and/or
after which such action shall be taken or omitted and the Rights Agent shall not be liable for any action taken, suffered or omitted in accordance with a proposal included in any such application on or after the date specified therein (which date
shall not be less than three Business Days after the date any such officer actually receives such application, unless any such officer shall have consented in writing to an earlier date) unless, prior to taking or omitting any such action, the
Rights Agent has received written instructions in response to such application specifying the action to be taken or omitted. 
  
 (i) The Rights Agent and any stockholder, director, Affiliate, 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 Person. 
  
 (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, with regard to acts performed through its
attorneys, the Rights Agent shall not be answerable or accountable for any act, default, neglect or misconduct of any such attorneys or for any loss to the Company resulting from any such act, default, neglect or misconduct, absent bad faith, gross
negligence or willful misconduct of the Rights Agent (as finally determined by a court of competent jurisdiction) in the selection and continued employment of such attorneys. 
  
 (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 it reasonably believes that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it. 

 
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Section 21.    Change of Rights Agent.    The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement upon 30
days’ notice in writing mailed to the Company and to each transfer agent of the Common Shares or Preferred Shares by registered or certified mail, and to the holders of the Right Certificates by first-class mail. The Company may remove the
Rights Agent or any successor Rights Agent upon 30 days’ notice in writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Shares or Preferred Shares by registered or certified
mail, and to the holders of the Right Certificates by first-class mail. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall
fail to make such appointment within a period of 30 days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right (who
shall, with such notice, submit such holder’s Right Certificate or, before the Distribution Date, certificate representing Common Shares, for inspection by the Company), then the registered holder of any Right may apply to any court of the
United States or of any state thereof having competent jurisdiction over such matter for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (i) a Person organized and
doing business under the laws of the United States or of the State of California (or of any other state of the United States), so long as such Person in good standing, which is authorized under such laws to exercise shareholder service powers and is
subject to supervision or examination by federal or state authority and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least $50 million dollars or (ii) an Affiliate of a Person described in clause (i)
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 Shares or Preferred Shares, and mail a notice thereof in writing to the registered holders of Rights. Failure
to give any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

  
 
Section 22.    Issuance of New Right Certificates.    Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its
option, issue new Right Certificates evidencing Rights in such form as may be approved by its Board 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 made in accordance with the provisions of this Agreement. In addition, following the Distribution Date and prior to the Redemption Date or Final Expiration Date, in connection with the issuance or sale of Common Shares
pursuant to the exercise of stock options or under any employee plan or arrangement or upon the exercise, conversion or exchange of other securities of the Company, in each case, which options or securities are outstanding prior to the Distribution
Date, the Board of Directors shall issue Right Certificates representing the appropriate number of Rights in connection with such issuance or sale; provided, however, that (i) no such Right Certificate shall be issued and this sentence
shall be null and void ab initio if, and to the extent that, such issuance or this

 
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sentence would create a significant risk of or result in material adverse tax consequences to the Company or the Person to whom such Right Certificate would be issued or would create a
significant risk of or result in such options’ or employee plans’ or arrangements’ failing to qualify for otherwise available special tax treatment and (ii) no such Right Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance thereof. 
  
 
Section 23. Redemption. 
  
 (a) The Board of Directors of the Company may, at
its option, at any time from and after the Record Date and prior to such time as any Person becomes an Acquiring Person (the “Redemption Period”), redeem all but not less than all the then outstanding Rights at a redemption
price of $0.001 per Right, appropriately adjusted to reflect each stock split, stock combination, stock dividend or similar transaction occurring after the date hereof (such redemption price, as so adjusted, being hereinafter referred to as the
“Redemption Price”). After the Redemption Period has expired, the Board of Directors may not extend the period for redemption of the Rights or otherwise provide for their redemption. The redemption of the Rights by the Board
of Directors may be made effective at such time during the Redemption Period, on such basis and subject to such conditions as the Board of Directors in its sole discretion may establish. 
  
 (b) Immediately upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to Section 23(a), and without any further action and
without any notice, the right to exercise all then outstanding Rights will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price. The Company shall promptly give notice to the Rights Agent and
public notice of any such redemption; provided, however, that the failure to give, or any defect in, any such notice shall not affect the validity of such redemption. Within ten days after such action of the Board of Directors ordering
the redemption of the Rights pursuant to Section 23(a), the Company shall mail a notice of redemption to all the holders of the then outstanding Rights at their last addresses as they appear upon the registry books of the Rights Agent or, prior to
the Distribution Date, on the registry books of the transfer agent for the Common Shares. Any notice that is mailed in the manner herein provided shall be deemed given upon mailing, whether or not the holder receives the notice. If the payment of
the Redemption Price is not included in such notice, each such notice shall state the method by which the payment of the Redemption Price will be made. Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase for
value any Rights at any time in any manner other than (i) as specifically set forth in this Section 23 or in Section 24 hereof, or (ii) in connection with the purchase of Common Shares prior to the Distribution Date. 
  
 
Section 24. Exchange. 
  
 (a) The Board of Directors of the Company may, at its
option, at any time after any Person becomes an Acquiring Person, authorize and direct the exchange of all or part of the then outstanding and exercisable Rights (which shall not include Rights that have become Void Rights) for Common Shares at an
exchange ratio (the “Exchange Ratio”) of one Common Share per Right, appropriately adjusted to reflect each stock split, stock combination, stock dividend or similar transaction occurring after the date hereof.
Notwithstanding the foregoing,

 
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the Board of Directors shall not be empowered to effect such exchange at any time after any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan of the Company
or any such Subsidiary or any entity holding Common Shares for or pursuant to the terms of any such plan), together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of a majority of the Common Shares then outstanding.

  
 (b)  Immediately upon the action of the Board of Directors of the Company ordering the exchange of any
Rights pursuant Section 24(a) hereof and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of Common Shares
equal to the number of such Rights held by such holder multiplied by the Exchange Ratio. The Company shall promptly give notice to the Rights Agent and public notice of any such exchange; provided, however, that the failure to give, or
any defect in, such notice shall not affect the validity of such exchange. The Company promptly shall mail a notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry books of the
Rights Agent. Any notice that is mailed in the manner herein provided shall be deemed given when mailed, whether or not the holder receives the notice. Each such notice of exchange will state the method by which the exchange of the Common Shares for
Rights will be effected and, in the event of any partial exchange, the number of Rights that will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights that have become Void Rights) held by
each holder of Rights. 
  
 (c)  In any exchange pursuant to this Section 24, the Company, at its option,
may substitute Preferred Shares (or common stock equivalents, as such term is defined in Section 11(a)(iii) hereof) for Common Shares exchangeable for Rights, at the initial rate of one one-hundredth of a Preferred Share (or common stock
equivalents) for each Common Share, as appropriately adjusted to reflect adjustments in the voting rights of the Preferred Shares pursuant to the terms thereof, so that the fraction of a Preferred Share delivered in lieu of each Common Share shall
have the same voting rights as one Common Share. 
  
 (d)  In the event that there shall not be sufficient
Common Shares, Preferred Shares or common stock equivalents authorized by the Company’s certificate of incorporation and not outstanding or subscribed for, or reserved or otherwise committed for issuance for purposes other than upon exercise of
Rights, to permit any exchange of Rights as contemplated in accordance with this Section 24, the Company shall take all such action as may be necessary to authorize additional Common Shares, Preferred Shares or common stock equivalents for issuance
upon exchange of the Rights. 
  
 (e)  The Company shall not be required to issue fractions of Common Shares
or to distribute certificates that evidence fractional Common Shares. In lieu of such fractional Common Shares, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional Common Shares would
otherwise be issuable, an amount in cash equal to the same fraction of the current per share market value of a whole Common Share. For the purposes of this Section 24(e), the current per share market value of a whole Common Share shall be the
closing price of a Common Share (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of exchange pursuant to this Section 24. 

 
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Section 25.    Notice of Certain Events. 
  
 (a)  In case the Company shall propose (i) to pay any dividend payable in stock of any class to the holders of its Preferred Shares or to make any other distribution to the holders of its Preferred Shares (other than a
regular quarterly cash dividend), (ii) to offer to the holders of its Preferred Shares rights or warrants to subscribe for or to purchase any additional Preferred Shares or shares of stock of any class or any other securities, rights or options,
(iii) to effect any reclassification of its Preferred Shares (other than a reclassification involving only the subdivision of outstanding Preferred Shares), (iv) to effect any consolidation or merger into or with, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale or other transfer), in one or more transactions, of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person, (v)
to effect the liquidation, dissolution or winding up of the Company or (vi) to declare or pay any dividend on the Common Shares payable in Common Shares or to effect a subdivision, combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in Common Shares), then, in each such case, the Company shall give to the Rights Agent and each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of such proposed
action, which shall specify the record date for the purposes of such stock dividend, or distribution of rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution or winding up is
to take place and the date of participation therein by the holders of the Common Shares and/or Preferred Shares, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (i) or (ii) above at
least ten days prior to the record date for determining holders of the Preferred Shares for purposes of such action, and in the case of any such other action, at least ten days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of the Common Shares and/or Preferred Shares, whichever shall be the earlier. 
  
 (b)  If any event set forth in Section 11(a)(ii) hereof shall occur, then the Company shall as soon as practicable thereafter give to each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of the
occurrence of such event, which notice shall describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) hereof. 
  
 
Section 26.    Notices.    Notices or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right to or on the Company shall
be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in writing with the Rights Agent) as follows: 
  
 Keynote Systems, Inc. 
 777 Mariners Island
Blvd 
 San Mateo, California 94404 
 Attention:  Corporate Secretary 
  
 Subject to the provisions of Section 21 hereof, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder of any Right to or on the Rights Agent shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Company) as follows: 

 
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 American Stock Transfer & Trust Company 
 59 Maiden Lane 
 Plaza Level 

New York, NY 10038 
 Attention:  Herbert J. Lemmer, Vice President, General Counsel 
  
 Notices or demands authorized by this Agreement
to be given or made by the Company or the Rights Agent to the holder of any Right Certificate shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the
registry books of the Company. 
  
 
Section 27.    Supplements and Amendments.    The Company may, by resolution of its Board of Directors, from time to time, and the Rights Agent shall, if the Company
directs, supplement or amend this Agreement without the approval of any holders of Rights in order to cure any ambiguity, to correct or supplement any provision contained herein that may be defective or inconsistent with any other provisions herein,
or to make any other provisions or changes with respect to the Rights that the Company may deem necessary or desirable, including, without limitation, to modify or amend the definition of Acquiring Person set forth in Section 1(a) hereof, to change
the Purchase Price set forth in Section 7(b), or to extend or shorten the period for redemption of the Rights; provided, however, that from and after such time as any Person becomes an Acquiring Person, this Agreement shall not be
amended in any manner that would adversely affect the interests of the holders of Rights (other than Void Rights of an Acquiring Person and its Affiliates and Associates), including, without limitation, to extend the period for redemption of the
Rights, or otherwise provide for their redemption, or to provide for an earlier Final Expiration Date. Any such supplement or amendment will be evidenced by a writing signed by the Company and the Rights Agent. Upon the delivery of a certificate
from an appropriate officer of the Company and, if requested by the Rights Agent, an opinion of counsel, that states that the proposed supplement or amendment complies with this Section 27, the Rights Agent shall execute such supplement or
amendment, provided, however, the Rights Agent shall not be obligated to enter into any amendment or supplement to this Agreement that in the opinion of the Rights Agent, may adversely affect the rights, duties, liabilities of the
Rights Agent. 
  
 
Section 28.    Successors.    All the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to the
benefit of their respective successors and assigns hereunder. 
  
 
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 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. 

 
 
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, then such term, provision, covenant or restriction shall be enforced to the maximum extent permissible, and the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated. 

 
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Section 31.    Governing Law.    This Agreement and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware
and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be made and performed entirely within such State. 
  
 
Section 32.    Counterparts.    This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the same instrument. 
  
 
Section 33.    Descriptive Headings.    Descriptive headings of the several Sections of this Agreement are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof. 
  
 
Section 34.    Entire Agreement.    This Agreement contains the entire agreement between the parties with respect to the subject matter hereof. 
  
 [Signatures on Following Page] 

 
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IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement to be duly executed and attested, all as of the day and year first above written. 
  
 Company: 
  
 KEYNOTE SYSTEMS, INC. 
  
 
	 
	 By:
 	 	 /s/ John J. Flavio
 

 
 
	 
	 Name:
 	 	 John J. Flavio
 

 
 
	 
	 Title:
 	 	 Senior Vice President of Finance and
 

	  	 	 Chief Financial Officer
 

 
  
 Rights Agent: 
  
 AMERICAN STOCK TRANSFER & TRUST COMPANY 
  
 
	 
	 By:
 	 	 /s/ Herbert J. Lemmer
 

 
 
	 
	 Name:
 	 	 Herbert J. Lemmer
 

 
 
	 
	 Title:
 	 	 Vice President
 

 

 
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Exhibit A 
  
 FORM 
  
 of 
  
 CERTIFICATE OF DESIGNATIONS

  
 of 
  
 SERIES A JUNIOR PARTICIPATING PREFERRED STOCK 
  
 of 
  
 KEYNOTE SYSTEMS, INC. 
  
 (Pursuant to Section 151 of the 
 Delaware General Corporation Law) 
  
 
 
 Keynote Systems, Inc., a corporation organized and existing under the General Corporation Law of
the State of Delaware (hereinafter called the “Corporation”), hereby certifies that the following resolution was adopted by the Board of Directors of the Corporation as required by Section 151 of the General Corporation Law
at a meeting duly called and held on October 25, 2002: 
  
 RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (hereinafter called the “Board of Directors” or the “Board”) in accordance with the provisions of the Certificate of Incorporation of the
Corporation, the Board of Directors hereby creates a series of Preferred Stock, par value $0.001 per share (the “Preferred Stock”), of the Corporation and hereby states the designation and number of shares, and fixes the
relative rights, preferences, and limitations thereof as follows: 
  
 Series A Junior Participating Preferred Stock:

  
 Section 1.    Designation and Amount.  The shares of such series
shall be designated as “Series A Junior Participating Preferred Stock” (the “Series A Preferred Stock”) and the number of shares constituting the Series A Preferred Stock shall be 500,000. Such number
of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the
number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock. 
  
 Section 2.    Dividends and Distributions. 
  
 (A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any other stock) ranking prior and superior to the Series A Preferred Stock with
respect to dividends, the holders of shares of Series A Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, 
  
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 quarterly dividends payable in cash on the first day of March, June, September and December in each year
(each such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock,
in an amount (if any) per share (rounded to the nearest cent), subject to the provision for adjustment hereinafter set forth, equal to 100 times the aggregate per share amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock, par value $0.001 per share (the “Common Stock”), of the Company or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares
of Series A Preferred Stock were entitled immediately prior to such event under the preceding sentence shall be adjusted by multiplying (x) such amount by (y) a fraction, (1) the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and (2) the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 
  
 (B) The Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock). 
  
 (C) Dividends due pursuant to paragraph
(A) of this Section shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled
to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof. 
  
 Section 3.    Voting Rights.  The holders of shares of Series A Preferred Stock shall have the following voting rights:

  
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 (A) Subject to the provision for adjustment hereinafter set forth, each share of
Series A Preferred Stock shall entitle the holder thereof to 100 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying (x) such number by (y) a fraction,
(1) the numerator of which is the number of shares of Common Stock outstanding immediately after such event and (2) the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 

 
 (B) Except as otherwise provided herein, in any other Certificate of Designations creating a series of Preferred Stock or any
similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation. 
  
 (C) Except as set forth herein, or as otherwise provided
by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate
action. 
  
 Section 4.    Certain Restrictions. 
  
 (A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are
in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not: 
  
 (i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock; 
  
 (ii)
declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the
Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled; or 
  

(iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (as
to dividends and upon dissolution, liquidation or winding up) to the Series A Preferred Stock. 
  
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 (B) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner. 

 
 Section 5.    Reacquired Shares.  Any shares of Series A Preferred Stock purchased
or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may
be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth herein, in the Certificate of Incorporation, or in any other Certificate of Designations creating a series of Preferred Stock or
any similar stock or as otherwise required by law. 
  
 Section 6.    Liquidation,
Dissolution or Winding Up. 
  
 (A) Upon any liquidation, dissolution or winding up of the Corporation, the
holders of shares of Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any assets of the Corporation to the holders of Common Stock, the amount of $1.00 per share for each share of Series A
Preferred Stock then held by them. Thereafter, the holders of shares of Series A Preferred Stock shall be entitled to receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of shares of Common Stock plus an amount equal to any accrued and unpaid dividends. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the preceding sentence shall be adjusted by multiplying (x) such amount by
(y) a fraction (1) the numerator of which is the number of shares of Common Stock outstanding immediately after such event and (2) the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such
event. 
  
 (B) If the assets of the Corporation legally available for distribution to the holders of shares of Series
A Preferred Stock upon liquidation, dissolution or winding up of the Corporation are insufficient to pay the full preferential amount set forth in the first sentence of paragraph (A) above, then the entire assets of the Corporation legally available
for distribution to the holders of Series A Preferred Stock shall be distributed among such holders in proportion to the shares of Series A Preferred Stock then held by them. 
  
 (C) The foregoing rights upon liquidation, dissolution or winding up provided to the holders of Series A Preferred Stock shall be subject to the rights of the holders of
any other series of Preferred Stock (or any other stock) ranking prior and superior to the Series A Preferred Stock upon liquidation, dissolution or winding up. 
  
 Section 7.    Consolidation, Merger, etc.  In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or other property, then in any 
  
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 such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 100 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for
which each share of Common Stock is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying (x) such amount by (y) a fraction, (1) the numerator of which is the number of shares of Common Stock outstanding immediately
after such event and (2) the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 
  
 Section 8.    No Redemption.  The shares of Series A Preferred Stock shall not be redeemable. 
  
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 IN WITNESS WHEREOF, this Certificate of Designations is executed on behalf of the
Corporation this      day of                     , 2002. 
  

KEYNOTE SYSTEMS, INC. 
 
	 
	 By:
 	 	 

	  	 	 John J. Flavio
 Senior Vice President of Finance and
 Chief Financial Officer
 

 
  
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Exhibit B 
  
 SUMMARY OF STOCK PURCHASE RIGHTS 
  
 On October 25, 2002, the Board of Directors of Keynote Systems, Inc. (the “Company”) declared a dividend of one
stock purchase right (a “Right”) for each outstanding share of common stock, par value $0.001 per share (the “Common Shares”), of the Company. The dividend is payable to stockholders of record on
October 29, 2002 (the “Record Date”). In addition, one Right will be issued with each share of Company common stock that becomes outstanding (i) between the Record Date and the earliest of the Distribution Date (as defined
below), the date the Rights are redeemed and the date the Rights expire or (ii) following the Distribution Date and prior to the date the Rights are redeemed and the date the Rights expire, pursuant to the exercise of employee stock options or upon
the exercise, conversion or exchange of other securities of the Company, outstanding prior to the Distribution Date. Each Right entitles the registered holder to purchase from the Company one one-hundredth of a share of the Company’s Series A
Junior Participating Preferred Stock (the “Preferred Shares”) at a price of $60.00 per one one-hundredth of a Preferred Share (the “Purchase Price”), subject to adjustment. A complete description of
the terms of the Rights is set forth in a Rights Agreement between the Company and American Stock Transfer & Trust Company, as Rights Agent. 
  
 Until the earlier to occur of (i) ten days following a public announcement or disclosure that a person or group of affiliated or associated persons (an “Acquiring Person”), has
acquired beneficial ownership of 15% or more of the Company’s outstanding common stock or (ii) ten business days (or a later date determined by the Company’s Board of Directors before a person or group becomes an Acquiring Person)
following the announcement of an intention to make a tender offer or exchange offer the consummation of which would result in a person or group becoming an Acquiring Person (the earlier of such dates being called the “Distribution
Date”), the Rights will be represented by common stock certificates with a copy of this Summary of Rights attached. No person or group will become an Acquiring Person if the Company’s Board of Directors determines that such person
crossed the ownership threshold inadvertently, and such person or group promptly sells shares of Company common stock until they own less than 15% of the outstanding common stock. 
  
 The Rights Agreement provides that, until the Distribution Date, the Rights will be transferred only with Company common stock. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new common stock certificates issued after the Record Date will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier redemption or expiration of the
Rights), the transfer of any common stock certificates, even without such notation or a copy of this Summary of Rights being attached, will also constitute the transfer of the Rights associated with the Company common stock represented by such
certificate. After the Distribution Date, separate certificates representing the Rights will be mailed to record holders of Company common stock on the Distribution Date and such separate certificates alone will evidence the Rights. If shares of
Company common stock are issued or sold after the Distribution Date (but prior to the redemption or expiration of the Rights) in connection with the exercise of stock options or upon the exercise, conversion or exchange of other securities of the
Company outstanding prior to the Distribution Date, the Company shall issue the appropriate number of Rights in connection with such issuance or sale. 
  
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 The Rights are not exercisable until the Distribution Date. The Rights will
expire on October 29, 2012, unless the expiration date is extended or unless the Rights are earlier redeemed or exchanged by the Company, as described below. Until a Right is exercised, the holder of a Right, as such, will have no rights as a
stockholder of the Company. 
  
 The purchase price payable, and the number of Preferred Shares or other securities or
property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution. The number of Rights and the number of one one-hundredths of a Preferred Share issuable upon exercise of each Right are also subject to
adjustment upon certain events occurring before the Distribution Date. 
  
 The Preferred Shares have been structured
so that each Preferred Share has dividend, liquidation and voting rights equal to those of 100 shares of Company common stock. Because of this, the value of the one one-hundredth interest in a Preferred Share purchasable upon exercise of each Right
should approximate the value of one Common Share. The Preferred Shares are not redeemable. 
  
 In the event that any
person or group owns more than 15% of the Company’s outstanding common stock and thereby becomes an Acquiring Person, unless the event causing the person to become an Acquiring Person is a merger, acquisition or other business combination
described in the next paragraph, each holder of a Right, other than Rights beneficially owned by the Acquiring Person (which will thereafter be void), will thereafter have the right to receive upon exercise and payment of the exercise price that
number of shares of common stock having a market value of two times the exercise price of the Right. If the Company does not have enough authorized but unissued shares of common stock to satisfy this obligation to issue common shares, the Company
will deliver upon payment of the exercise price of a Right an amount of cash or other securities equivalent in value to the common stock issuable upon exercise of a Right. 
  
 In the event that any person or group becomes an Acquiring Person and the Company merges into or engages in certain other business combinations with an Acquiring Person, or
50% or more of its consolidated assets or earning power are sold to an Acquiring Person, each holder of a Right, other than Rights owned by an Acquiring Person, will thereafter have the right to receive, upon exercise and payment of the exercise
price, that number of shares of common stock of the acquiring company that at the time of such transaction will have a market value of two times the exercise price of the Right. 
  
 At any time after a person or group becomes an Acquiring Person and prior to such person acquiring a majority of the outstanding Company common stock, the Company Board of
Directors may exchange all or some of the Rights (other than Rights owned by the Acquiring Person), at an exchange ratio of one Common Share, or one one-hundredth of a Preferred Share (or other equivalent securities), per Right. 

 
 At any time before a person or group becomes an Acquiring Person, the Company Board of Directors may redeem all (but not some)
of the Rights at a price of $0.001 per Right and on such terms and conditions as the Board of Directors may establish. After the period for redemption of the Rights has expired, the Board may not amend the Rights Agreement to extend the period for
redemption of the Rights. Immediately upon any redemption of the Rights, the 
  
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 right to exercise the Rights will terminate and the only right of the holders of Rights will be to
receive the redemption price. 
  
 The terms of the Rights may be amended by a resolution of the Board of Directors
without the consent of the holders of the Rights, except that after a person or group becomes an Acquiring Person, no such amendment may adversely affect the interests of the holders of the Rights (other than an Acquiring Person). 

 
 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 filed October 29, 2002. 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 deemed to be incorporated into this summary. 
  
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Exhibit C 
  
 FORM OF RIGHT CERTIFICATE 
  
 
	 Certificate No. R-
 	  	          Rights
 

 
  
 NOT EXERCISABLE AFTER
                    , 2012, OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.001 PER RIGHT AND TO
EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. 
  
 RIGHT CERTIFICATE 
  
 KEYNOTE SYSTEMS, 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
October 25, 2002 (the “Rights Agreement”), between Keynote Systems, Inc., a Delaware corporation (the “Company”), and American Stock Transfer & Trust Company (the “Rights
Agent”), to purchase from the Company at any time after the Distribution Date (as such term is defined in the Rights Agreement) and prior to 5:00 p.m., Pacific Time, on October 29, 2012 at the office of the Rights Agent, or at the
office of its successor as Rights Agent, one one-hundredth of a fully paid non-assessable share of Series A Junior Participating Preferred Stock, par value $0.001 per share (the “Preferred Shares”), of the Company, at a
purchase price of                      Dollars ($         ) per one one-hundredth of a
Preferred Share (the “Purchase Price”), upon presentation and surrender of this Right Certificate with the Certification and the Form of Election to Purchase duly executed. The number of Rights evidenced by this Right
Certificate (and the number of one one-hundredths of a Preferred Share that may be purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number and Purchase Price as of
                    , based on the Preferred Shares as constituted at such date. As provided in the Rights Agreement, the Purchase Price and
the number of one one-hundredths of a Preferred Share that may be purchased upon the exercise of the Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events. 
  
 This Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and
conditions are hereby incorporated herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement are on file at the principal executive offices of the Company and the above-mentioned offices of the Rights Agent. 
  
 This Right Certificate, with or without other Right Certificates, upon surrender at the principal office of the Rights Agent, may be
exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of Preferred Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered shall have entitled such holder to purchase. If this Right Certificate shall 
  
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be exercised in part, the holder shall be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised. 

 
 Subject to the provisions of the Rights Agreement, the Rights evidenced by this Certificate (i) may be redeemed by the Company
at a redemption price of $0.001 per Right or (ii) may be exchanged in whole or in part for Preferred Shares or shares of the Company’s Common Stock, par value $0.001 per share. 
  
 No fractional Preferred Shares will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions that are integral multiples of one
one-hundredth of a Preferred Share, which may, at the election of the Company, be evidenced by depository receipts), but in lieu thereof a cash payment will be made, as provided in the Rights Agreement. 
  
 No holder of this Right Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the
Preferred Shares or of any other securities of the Company that may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings
or other actions affecting stockholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate shall have been exercised as provided
in the Rights Agreement. 
  
 This Right Certificate shall not be valid or obligatory for any purpose until it shall
have been countersigned by the Rights Agent. 
  
 WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. 
  
 Dated as of
                                        

  
 ATTEST: 
  
 
	  	 	  	 	 KEYNOTE SYSTEMS, INC.
 
	 
	 By:
 	 	 
	 	  	 	 By:
 	 	 

	 
	 Countersigned:
 	 	  	 	  	 	  
	 
	 AMERICAN STOCK TRANSFER & TRUST COMPANY
 	 	  	 	  
	 
	 By:
 	 	 
	 	  	 	  	 	  
	  	 	 Authorized Signature
 	 	  	 	  	 	  

 
  
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 Form of Reverse Side of Right Certificate 
  
 FORM OF ASSIGNMENT 
  
 (To be executed by the registered holder if
such 
 holder desires to transfer the Right Certificate) 
  
 FOR VALUE RECEIVED
                                        
                                        
         hereby sells, assigns and transfers unto
                                        
                                        
(Please print name and address of transferee) this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint
                                        
                                    , Attorney, to transfer the
within Right Certificate on the books of the within-named Company, with full power of substitution. 
  
 Dated:
                                        

  
 
	 
	 

	 Signature
 

 
  
 Signature(s) Guaranteed: 
  
 SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15 
  
 
 
 The undersigned hereby certifies that the Rights evidenced by this Right Certificate are not beneficially owned by an Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights
Agreement). 
  
 
	 
	 

	 Signature
 

 

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 Form of Reverse Side of Right Certificate—continued 
  
 FORM OF ELECTION TO PURCHASE 
  
 (To be executed
if holder desires to 
 exercise the Right Certificate) 
  
 To
                                        :

  
 The undersigned hereby irrevocably elects to exercise
                                        
Rights represented by this Right Certificate to purchase the Preferred Shares issuable upon the exercise of such Rights and requests that certificates for such Preferred Shares be issued in the name of: 
  
 Please insert social security 
 or other identifying number
                                        
                                   
  
 
	  	  	  
	
	 	 
	 (Please print name and address)
 	  	  
	  	  	  
	
	 	 
	  	  	  
	
	 	 

 
  
 If such number of Rights shall not be all the Rights evidenced by this Right Certificate,
a new Right Certificate for the balance remaining of such Rights shall be registered in the name of and delivered to: 
  
 Please insert
social security 
 or other identifying number
                                        
                                   
  
 
	  	  	  
	
	 	 
	 (Please print name and address)
 	  	  
	  	  	  
	
	 	 
	  	  	  
	
	 	 

 
  
 Dated:
                                        
                                   
  
 
	 
	  	 	 

	  	 	 Signature
 

 
  
 Signature(s) Guaranteed: 
  
 SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT
UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15 

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 Form of Reverse Side of Right Certificate—continued 
  
 
 
 The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially owned by an Acquiring Person or an Affiliate or Associate thereof (as such terms are defined in the Rights Agreement). 
  
 
	 
	 

	 Signature
 

 
  
 
 
 NOTICE 
  
 The signature in the foregoing Forms of Assignment and Election must conform
to the name as written upon the face of this Right Certificate in every particular, without alteration or any change whatsoever. 
  
 In the event the certification set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, the Company and the Rights Agent will deem the beneficial owner of the Rights
evidenced by this Right Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights Agreement) and such Assignment or Election to Purchase will not be honored.Sublease Termination and Release Agreement

  
 Exhibit 10.3 
  
 SUBLEASE TERMINATION AND RELEASE 
  
 THIS SUBLEASE TERMINATION AND RELEASE (“Agreement”) is hereby entered into effective the 31st day of May, 2002 (“Effective Date”) by and between EON COMMUNICATIONS CORPORATION, a Delaware corporation (f/k/a Cortelco Systems, Inc.) (“Tenant”) and TC FOREST HILL
DEVELOPMENT, LP, a Delaware limited partnership (successor in interest to Trammell Crow Tennessee Development, Inc.) (“Landlord”). 
  
 R E C I T A L S 
  
 1.  Landlord and Tenant entered
into a Lease Agreement dated May 7, 1999, as amended, by which Landlord has leased the premises (the “Premises”) more particularly described therein to Tenant; and 
  
 2.  At Tenant’s request, Landlord conveyed the Premises to The Industrial Development Board of the City of Memphis and County of Shelby, Tennessee (the
“IDB”), and the IDB, in turn, leased the Premises back to Landlord pursuant to that certain Real Property Lease Agreement (“Pilot Lease”) effective December 31, 1999, by and between the IDB, as lessor, and Landlord, as
lessee (“PILOT Transaction”); 
  
 3.  As a result of the PILOT Transaction, the aforesaid
Lease Agreement between the parties was converted into a sublease (hereinafter, the “Sublease”); and 
  
 4.  Landlord and Tenant desire to terminate the Sublease prior to the end of the term stated in the Sublease and agree to release each other from any further liability in connection therewith except as set forth below, on
the terms and conditions set forth below. 
  
 NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 
  
 1.  Termination of Sublease.    Subject to satisfaction of all Termination Conditions (defined below) and to Section 7 below, the parties agree that the Sublease shall terminate at 12:00
a.m. on June 1, 2002 (“Termination Date”), and thereafter the Sublease and all rights and obligations of the parties thereunder shall be deemed to have expired and terminated as fully and completely and with the same force and
effect as if such date were the termination date set forth in the Sublease. In such event, Tenant shall be liable for and shall pay all sums due under the Sublease as rent or otherwise through and including the Termination Date, which are more
particularly set forth on Exhibit A attached hereto and incorporated herein by reference (“Final Sublease Payment”). After payment of the Final Sublease Payment as expressly set forth on Exhibit A, Tenant shall have no
further liability for any common area maintenance charges under the Sublease (including, but not limited to, Tenant’s obligations under the Sublease to pay its proportionate share of Operating Costs, as defined in the Sublease). Tenant shall
pay the Final Sublease Payment to Landlord by wire transfer for receipt by Landlord on or before the Termination Date in accordance with the wire transfer instructions that have been separately provided by Landlord to Tenant. Tenant shall in
addition be liable for any Tenant obligations under the Sublease that expressly survive termination of the Sublease (including without 

 

 limitation Tenant’s obligations under Section 27.01 of the Sublease). Unless and until the Sublease is terminated as set forth in this
Agreement, the Sublease is and shall remain in full force and effect according to its original terms and conditions and nothing contained in this Agreement shall be construed as a waiver by the Landlord or Tenant of any of their rights and remedies
under the Sublease. 
  
 2.  Termination Conditions.    Landlord’s agreement
to terminate the Sublease in Section 1 above is conditioned upon and subject to strict satisfaction by Tenant of each of the following conditions, time being of the essence with respect to each such condition (“Termination
Conditions”): 
  
 (a)  Tenant shall pay to Landlord a termination fee of One
Million Six Hundred Fifty Thousand Dollars ($1,650,000.00) payable as follows: 
  
 (i)  Tenant shall pay to Landlord Two Hundred Fifty Thousand and No/100 Dollars ($250,000.00) by wire transfer for receipt by Landlord on or before the Termination Date, in accordance with the wire transfer instructions
provided by Landlord to Tenant; 
  
 (ii)  Tenant shall execute and deliver to
Landlord a Promissory Note in the principal amount of One Million Four Hundred Thousand and No/100 Dollars ($1,400,000) in the form attached hereto as Exhibit B (“Note”) on or before the Termination Date; 

 
 (b)  Tenant shall cause to be delivered to Landlord the Letter of Credit (defined below) securing
Tenant’s obligations under the Note and this Agreement on or before the Termination Date. Upon delivery of the new Letter of Credit to Landlord and satisfaction of the other Termination Conditions, Landlord shall promptly surrender to Tenant
the existing $750,000 letter of credit in favor of Landlord so that it may be terminated; and 
  
 (c)  The Premises shall be delivered to Landlord in accordance with Section 5 hereof on or before the Termination Date and Tenant shall have performed all of its other obligations under the Sublease and/or this
Agreement through the Termination Date. 
  
 3.  Letter of Credit.    As a
security for Tenant’s obligations under this Agreement and the Note, Tenant shall deliver to Landlord an irrevocable Letter of Credit substantially in the form set forth on Exhibit C attached hereto in the amount of One Million Four
Hundred Thousand and No/100 Dollars ($1,400,000) (subject to adjustment as set froth below) naming Landlord as Beneficiary (“Letter of Credit”). The Letter of Credit (or a replacement or renewal Letter of Credit in the required
amount and form) must remain in full force and effect until ninety-one (91) days after payment in full of all sums due from Tenant to Landlord under this Agreement and the Note. The issuer of the Letter of Credit (the “Issuer”) must
remain at all times acceptable to Landlord in its sole discretion. An issuer which is rated A- or better by Standard & Poors or A3 or better by Moodys shall be deemed acceptable. If Landlord reasonably objects to the creditworthiness of the
Issuer, Landlord shall give Tenant written notice of said objection and within thirty (30) days Tenant shall replace the Letter of Credit with a Letter of Credit of substantially identical terms issued by a bank acceptable to Landlord. The

 
 2 

 face amount of the Letter of Credit may be reduced on June 15, September 15, December 15 and March 15 of each year during the term of the Note
to an amount equal to the then current balance of the Note (as of each such applicable date) plus One Hundred Seventy Five Thousand No/100 Dollars ($175,000). For example, if the outstanding balance of the Note on March 15, 2003 is $875,000, the
face amount of the Letter of Credit could be reduced at that time to $1,050,000. 
  
 4.  Release and
Indemnity.    Tenant, on behalf of itself, its successors and assigns, hereby releases, indemnifies and holds harmless Landlord and its current or former officers, members, shareholders, managers, partners, employees, agents,
attorneys, mortgagees, predecessors in interest, successors, affiliates, heirs or assigns of any of them, from and against any liabilities, losses, claims, demands, damages or expenses (including, without limitation, reasonable attorneys fees)
whatsoever, in law or in equity which Tenant ever had, now has or hereafter can, shall or may have arising out of or related to the Sublease or Tenant’s occupancy at the Premises, including without limitation any claims, damages or expenses
related to any casualty loss to Tenant’s property, interruption of Tenant’s business related thereto or any third party claims arising out of facts or circumstances that occurred prior to the Effective Date of this Agreement. 

 
 5.  Condition of Premises.    Tenant shall have until the Termination Date to remove its
personalty, equipment and trade fixtures from the Premises, as and to the extent permitted by the Sublease. On the Termination Date, Tenant shall deliver the Premises to Landlord in the condition required pursuant to the terms and provisions of the
Sublease concerning termination of the Sublease (including without limitation Section 7.01(b) of the Sublease). 
  
 6.  Representations and Warranties. 
  
 (a)  The parties
represent and warrant to each other that they have not assigned or transferred and shall not assign or transfer any of their respective rights under the Sublease to any other party prior to the Termination Date. 
  
 (b)  Landlord hereby represents that it has full power and authority to enter into this Agreement. This
Agreement constitutes the valid and binding agreement of Landlord, enforceable against Landlord in accordance with its terms. 
  
 (c)  Tenant hereby represents that it has full corporate power and authority to enter into this Agreement. All actions required by the Board of Directors or shareholders of Tenant to
authorize the execution and delivery by Tenant of this Agreement and the consummation by Tenant of the transactions contemplated hereby have been taken. This Agreement constitutes the valid and binding agreement of Tenant, enforceable against Tenant
in accordance with its terms. 
  
 7.  Unconditional Obligations.    In the event
Landlord is required to relinquish or return any payments made by or on behalf of Tenant pursuant to this Agreement or the Note or any proceeds of the Letter of Credit received by Landlord, in whole or in part, by reason of a proceeding arising
under the United States Bankruptcy Code, or for any other reason, then, at Landlord’s sole option, either (i) this Agreement and the Note shall continue to be effective or be reinstated, as the case may be, at any time any such payment or
proceeds received by Landlord are rescinded or must be returned for any reason, or (ii) all Tenant’s obligations under the 

 
 3 

 Sublease shall automatically be reinstated and shall continue to be effective notwithstanding any previous cancellation or release effected by
Landlord pursuant to this Agreement, as if no termination had occurred, and in such event Landlord shall apply all sums received and retained by Landlord pursuant to this Agreement against Tenant’s obligations under the Lease in such order as
Landlord shall elect in its sole discretion. 
  
 8.  PILOT
Transaction.    Landlord may, at any time after the Termination Date, request that the IDB revoke the PILOT Transaction and convey fee simple title to the Premises to Landlord. At Landlord’s request, Tenant shall
cooperate with Landlord and the IDB to effectuate such revocation. In the event that the PILOT Transaction is revoked, Landlord may obtain (i) an endorsement to any existing leasehold title policy issued to Landlord for the Premises through
Landlord’s counsel, with such endorsement reflecting the conversion of Landlord’s leasehold interest in the Premises into a fee interest as a result of the revocation of the PILOT Transaction and the reconveyance of the Premises from the
IDB to Landlord and insuring Landlord’s fee simple interest on the Premises in the amount of $7,500,000, or (ii) an Owner’s Title Policy issued by a title company satisfactory to Landlord, through Landlord’s counsel, in the amount of
$7,500,000, and Tenant shall pay all premiums, costs and expenses related to (i) or (ii). However, Landlord agrees to use commercially reasonable efforts to pursue and obtain the lowest cost option [as between either (i) or (ii) above], provided
that Landlord’s fee interest in the Premises is reasonably insured in the amount of $7,500,000. Except as a result of Landlord’s gross negligence or willful misconduct, Tenant, on behalf of itself, its successors and assigns, hereby
indemnifies and holds harmless Landlord and its current or former officers, members, shareholders, managers, partners, employees, agents, attorneys, mortgagees, predecessors in interest, successors, affiliates, heirs or assigns of any of them, from
and against any liabilities, losses, claims, demands, damages or expenses (including, without limitation, reasonable attorneys fees) whatsoever, in law or in equity arising out of or related to the PILOT Transaction, the revocation of the PILOT
Transaction by Landlord, or Tenant’s failure to comply with any of the documents, instruments or agreements relating to or evidencing the Pilot Transaction (including without limitation, Recapture Payments (as such term is defined in Section
9.04(d) and/or Section 9.08 of the Pilot Lease) due for any period prior to the Effective Date hereof, and any other payment or expense due to the IDB pursuant to the Pilot Lease or any other document, instrument or agreement whatsoever evidencing
or relating to the Pilot Transaction). It is understood and agreed that Tenant shall not be responsible for Recapture Payments due to the IDB under the Pilot Lease that are attributable solely to periods after the Effective Date. 

 
 9.  Loan Documentation.    In connection with termination of the Sublease and/or the Pilot
Transaction as set forth in this Agreement, Tenant agrees to reimburse Landlord promptly for any cost or expense (including without limitation reasonable attorney’s fees and recording costs) incurred or required to be paid by Landlord relative
to any modification, amendment, and/or termination of (i) that certain $6,000,000.00 loan from Union Planters Bank (“UP”) to Landlord pursuant to the Construction/Term Loan Agreement dated December 31, 1999, secured by that certain
Leasehold Construction Deed of Trust, Assignment of Rents and Security Agreement dated December 31, 1999 executed by Landlord in favor of Union Planters Bank, as previously amended or modified (the “UP Deed of Trust”), and evidenced by all
other documentation and instruments executed in connection therewith; provided, that Tenant’s maximum liability under this subsection 9(i) shall not exceed $10,000.00 (“Maximum UP Liability”); and (ii) that certain
$7,000,000.00 loan from Landlord to the IDB evidenced by that certain Industrial Development Revenue Real Property Note (Cortelco Project) Series 1999-1, 

 
 4 

 secured by the Deed of Trust executed by the IDB in favor of Landlord (the “Landlord Deed of Trust”), and evidenced by all other
documentation and instruments executed in connection therewith. Except as a result of Landlord’s gross negligence or willful misconduct, Tenant, on behalf of itself, its successors and assigns, hereby indemnifies and holds harmless Landlord and
its current or former officers, members, shareholders, managers, partners, employees, agents, attorneys, mortgagees, predecessors in interest, successors, affiliates, heirs or assigns of any of them, from and against any liabilities, losses, claims,
demands, damages or expenses (including, without limitation, reasonable attorneys fees) whatsoever, in law or in equity arising out of or related to the occurrence of a default or event of default under the Landlord Deed of Trust arising out of or
related to Tenant’s default under the Pilot Lease or Tenant’s failure to comply with any of the documents, instruments or agreements relating to or evidencing the Pilot Transaction, but excluding any Recapture Payments due to the IDB that
are attributable solely to periods after the Effective Date. 
  
 10.  Successors-in-Interest, Governing
Law and Modification.    This Agreement shall be binding upon and shall inure to the benefit of each party and its respective successors and assigns, shall be governed by and construed in accordance with the laws of the state
where the Premises are located, and may not be amended or modified other than in writing signed by the party to be charged therewith. 
  
 11.  Entire Agreement.    This Agreement, and any agreement and/or instruments previously delivered or to be delivered in connection herewith, contain the entire agreement between the
parties hereto and except as otherwise specifically set forth herein, supersede all prior agreements and undertakings between the parties hereto or any of them or any of their affiliates relating to the subject matter hereof. 

 
 12.  Counterparts.    This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same instrument, and it shall constitute sufficient proof of the Agreement to present any copy, copies or facsimiles signed by the parties to be charged.

  
 13.  Severability.    Should any provision of this Agreement be declared
invalid or unenforceable, whether in whole or in part, by any court of competent jurisdiction, the remaining provisions and/or portions of the affected provisions which remain valid or enforceable shall not be affected thereby. 

 
 14.  Discharge of Memorandum.    If the parties have previously executed and recorded a
memorandum of lease, Tenant shall execute and acknowledge within five (5) days of receipt of same from Landlord a discharge and release of such memorandum of lease. Landlord, at its sole cost and expense, shall have the right to cause the discharge
and release of memorandum of lease to be filed or recorded in the applicable recorder’s office. 
  
 15.  Attorneys’ Fees.    In the event any litigation proves necessary to interpret or enforce this Agreement, the prevailing party shall be entitled to recover its attorney fees and court
costs from the other party, including pre-suit and appellate attorney fees and costs. 
  
 16.  Broker.    Landlord and Tenant each represent to the other that no brokers were involved in this transaction other than E. H. Crump Realty, Inc. (“Broker”), on behalf of
Tenant. 

 
 5 

 Tenant agrees to pay any commission, fee or other compensation due Broker (or any other broker) in connection with the Sublease or the
termination of the Sublease contemplated hereby, and shall indemnify and hold Landlord harmless from and against the same. 
  
 17.  Payment of Attorney’s Fees in Connection with this Agreement.    Concurrently with its execution of this Agreement, Tenant shall pay, by wire transfer, Landlord’s legal fees and
expenses in connection with this matter in the amount of $13,500.00 and UP’s legal fees and expenses in connection with this matter in the amount of $2,500.00. (Such payment of UP’s legal fees shall be credited against Tenant’s
Maximum UP Liability.) 
  
 IN WITNESS WHEREOF, the parties have executed this Agreement to be effective the date and
year first above written. 
  
 [COUNTERPART SIGNATURE PAGES FOLLOW.] 

 
 6 

  
 COUNTERPART SIGNATURE PAGE TO SUBLEASE TERMINATION AND RELEASE 

 
 
	 EON COMMUNICATIONS CORPORATION
 
	 
	 By:
 	 	 /s/    TROY E.
LYNCH        
 

	  	 	 President and CEO
 

 

 
 7 

  
 COUNTERPART SIGNATURE PAGE TO SUBLEASE TERMINATION AND RELEASE 

 
 
	 TC FOREST HILL DEVELOPMENT, LP
 
	 
	 By:
 	 	 Trammell Crow Tennessee Development,
 Inc., its General Partner
 
	  	 	  
	 
	 By:
 	 	 /s/    PATRICK T. HENRY
        
 

	  	 	 President
 

 

 
 8 

  
 EXHIBIT A 
  
 FINAL SUBLEASE PAYMENT 
  
 
	 2001 Operating Expenses
 	  	 $
 	 43,880.30
 
	 January-May 2002 CAM charges
 	  	 $
 	 18,283.45
 
	  	  	 
	 

	 Total
 	  	 $
 	 62,163.75
 
	  	  	 
	 

 

 
 9 

  
 EXHIBIT B 
  
 PROMISSORY NOTE 
  
 
	 $1,400,000.00
 	  	 Effective June 1, 2002
 
	  	  	 Memphis, Tennessee
 

 
  
 FOR VALUE RECEIVED, the undersigned (“Maker”)
promises to pay to the order of TC Forest Hill Development, LP, a Delaware limited partnership (“Payee”; Payee and any subsequent holder[s] hereof are hereinafter referred to collectively as “Holder”), the principal
sum of One Million Four Hundred Thousand and No/100 Dollars ($1,400,000), without interest (except as expressly provided below). All payments hereon shall be made in collected funds at Payee’s main office, or at such other location as the
holder hereof directs in writing, and shall be applied to principal, accrued interest (if any), and charges and expenses owing on or in connection with this Note, in such order as the holder hereof elects, except that payments shall be applied to
accrued interest (if any) before principal. 
  
 Principal shall be due and payable in twenty-four (24) equal monthly
installments of Fifty Eight Thousand Three Hundred Thirty Three Dollars and 33/100 ($58,333.33) each, with the first installment due and payable on July 1, 2002 and subsequent installments due and payable on the 1st day of each succeeding month
thereafter until June 1, 2004 (the “Maturity Date”), on which date the entire outstanding principal balance shall be immediately due and payable in full. 
  
 Maker may prepay the indebtedness evidenced hereby in whole or in part, at any time, without premium or penalty, by paying the unpaid principal balance, together with all
other charges and expenses owing. 
  
 This Note is secured by a Letter of Credit naming Payee as Beneficiary and
expiring no earlier than September 15, 2004 (“Letter of Credit”). 
  
 Time is of the essence of this
Note. It is hereby expressly agreed that in the event that any default be made in the payment of principal or interest as stipulated above (such event to be referred to as an “event of default”); or should any event of default occur
under any instrument or document now or hereafter further evidencing, securing or otherwise relating to the indebtedness evidenced hereby; or should Maker become the subject of bankruptcy or insolvency proceedings; then, and in such event, the
entire outstanding principal balance of the indebtedness evidenced hereby, together with any other sums advanced hereunder and/or under any other instrument or document now or hereafter evidencing, securing or in any way relating to the indebtedness
evidenced hereby, together with all unpaid interest accrued thereon, shall, at the option of Holder and without notice to Maker, at once become due and payable and may be collected forthwith, regardless of the stipulated date of maturity. Upon the
occurrence of any event of default as set forth herein, at the option of Holder and without notice to Maker, the entire outstanding principal balance shall bear interest thereafter until paid at an annual rate equal to twelve percent (12%) per
annum, regardless of whether there has been an acceleration of the payment of principal as set forth herein and Holder shall be entitled to draw the amount of any sums due hereunder one or more times, from time to time, under the Letter of Credit.
Notwithstanding anything in this instrument to the contrary, in no event shall the effective rate of 

 
 10 

 interest payable in respect to the indebtedness evidenced hereby exceed the maximum rate of interest allowed to be charged by applicable law
(the “Maximum Rate”). All such interest shall be paid at the time of, and as a condition precedent to, the curing of any such default. 
  
 If any payment (other than the final payment due upon the Maturity Date) is past due by five (5) days or more, Maker agrees to pay the Holder a late charge of (i) 5% of such payment amount or (ii) any
lesser maximum amount permitted under applicable law. No late charge, however, shall be imposed on any payment made on time and in full solely by reason of any previously accrued and unpaid late charge. 
  
 In the event this Note is placed in the hands of an attorney for collection or for enforcement or protection of the security, or if Holder
incurs any costs incident to the collection of the indebtedness evidenced hereby or the enforcement or protection of the security, in any case after the occurrence of an event of default, Maker and any endorsers hereof agree to pay a reasonable
attorney’s fee, all court and other costs, and the reasonable costs of any other collection efforts. 
  
 Presentment for payment, demand, protest and notice of demand, protest and nonpayment are hereby waived by Maker and all other parties hereto. No failure to accelerate the indebtedness evidenced hereby by reason of default hereunder,
acceptance of a past-due installment or other indulgences granted from time to time, shall be construed as a novation of this Note or as a waiver of such right of acceleration or of the right of Holder thereafter to insist upon strict compliance
with the terms of this Note or to prevent the exercise of such right of acceleration or any other right granted hereunder or by applicable laws. Unless otherwise specifically agreed by Holder in writing, the liability of Maker and all other persons
now or hereafter liable for payment of the indebtedness evidenced hereby, or any portion thereof, shall not be affected by (1) any renewal hereof or other extension of the time for payment of the indebtedness evidenced hereby or any amount due in
respect thereof, (2) the release of all or any part of any collateral now or hereafter securing the payment of the indebtedness evidenced hereby or any portion thereof, or (3) the release of or resort to any person now or hereafter liable for
payment of the indebtedness evidenced hereby or any portion thereof. This Note may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification or discharge is sought.

  
 This Note has been negotiated, executed and delivered in the State of Tennessee, and is intended as a contract
under and shall be construed and enforceable in accordance with the laws of said state. 

 
 11 

  
 As used herein, the terms “Maker” and “Holder” shall be
deemed to include their respective successors, legal representatives and assigns, whether by voluntary action of the parties or by operation of law. 
  
 
	 MAKER: 
  
 EON
COMMUNICATIONS CORPORATION
 
	 
	 By:
 	 	 

	 
	 Title:
 	 	 

	  	 	  

 

 
 12 

  
 EXHIBIT C 
  
 FORM OF LETTER OF CREDIT 
  
 [Issuer
Letterhead] 
  
 IRREVOCABLE STANDBY 
 LETTER OF CREDIT 
  
 
	 MAXIMUM AMOUNT U.S. $1,400,000.00
 	 	 No.                 *
 Effective Date: June 1, 2002
 

 
  
 To:   TC FOREST HILL DEVELOPMENT, LP,

          825 CROSSOVER LANE, SUITE 100 
           MEMPHIS, TN 38117 
  
 Ladies and Gentlemen: 
  
 We hereby establish in your favor our Irrevocable Standby Letter of Credit No.                 for the account of EON COMMUNICATIONS CORPORATION
(“Borrower”). This Letter of Credit is issued to you in connection with the Sublease Termination Agreement, dated effective May 31, 2002 between you and Borrower (the “Termination Agreement”) and the Promissory Note dated
effective June 1, 2002 from Borrower to you in the principal amount of One Million Four Hundred Thousand and No/100 Dollars ($1,400,000) (“Note”) and is subject to the following limitations: 
  
 1.  As of the date of presentation of a valid Draw Certificate, for any sum or sums not exceeding the maximum amount specified
in the following schedule in the aggregate for all drafts presented hereunder. 
  
 
	 Date of presentation of Draw Certificate
 
	  	 Maximum Amount
 

	 June 1, 2002—December 14, 2002
 	  	 $
 	 1,400,000.00
 
	 December 15, 2002—March 14, 2003
 	  	  
 	 1,225,000.00
 
	 March 15, 2003—June 14, 2003
 	  	  
 	 1,050,000.00
 
	 June 15, 2003—September 14, 2003
 	  	  
 	 875,000.00
 
	 September 15, 2003—December 14, 2003
 	  	  
 	 700,000.00
 
	 December 15, 2003—March 14, 2004
 	  	  
 	 525,000.00
 
	 March 15, 2004—June 14, 2004
 	  	  
 	 350,000.00
 
	 June 15, 2004 through expiration
 	  	  
 	 175,000.00
 

 
  
  
 2.  Funds under
this Letter of Credit are available against your signed draft marked “Drawn under Irrevocable Standby Letter of Credit No.                 dated effective June 1,
2002”. 
  
 3.  Drafts must be accompanied by a signed Draw Certificate in the form attached hereto.

 
 13 

 4.  This Letter of Credit may be drawn upon for all amounts then owing to you under the Termination Agreement
and/or the Note upon the occurrence of any of the following: 
  
 (i)  an event of default
under the Termination Agreement; 
  
 (ii)  an event of default under the Note; or

  
 (iii)  ten (10) days or less remains prior to the Expiry Date (as defined below) and
Borrower remains obligated to maintain a Letter of Credit under the Termination Agreement and/or the Note and has not provided a satisfactory Letter of Credit in the required amount renewing or replacing this Letter of Credit. 

 
 5.  We hereby agree to honor each draft drawn under and in compliance with the terms of this Letter of Credit if duly
presented, together with the originally executed Letter of Credit, at our offices at                     on or before the close of business on
the Expiry Date (defined below). 
  
 6.  This Letter of Credit sets forth in full the terms of our
undertaking, and such undertaking shall not in any way be modified, amended, amplified or limited by any document, instrument or agreement referred to herein, or in which this Letter of Credit is referred to, or to which this Letter of Credit
relates; and no such reference shall be deemed to incorporate herein by reference any such document, instrument or agreement. 
  
 7.  This Letter of Credit shall expire on September 15, 2004 (the “Expiry Date”). 
  
 8.  Multiple and partial drawings are permitted under this Letter of Credit. 
  
 9.  This Letter of Credit is issued subject to the International Standby Practices 1998 (“ISP98”) and, except as to matters governed thereby, shall be governed and construed in accordance with the internal laws of
the State of Tennessee. 
  
 
	 
	 By:
 	 	 

	 
	 Title:
 	 	 

 

 
 14 

  
 Draw Certificate 
 to Irrevocable Standby Letter of Credit No.             
 dated June
1, 2002, issued by 
  
 
 
 Irrevocable Standby Letter of Credit No.                 
  
 The undersigned duly authorized representative TC FOREST HILL DEVELOPMENT, LP (“Beneficiary”) hereby certifies, with reference to Irrevocable Standby Letter of Credit No.
                 (the “Letter of Credit”) issued by
                     in favor of Beneficiary, that: 
  
 [(i) EON COMMUNICATIONS CORPORATION has defaulted under its Sublease Termination Agreement dated effective May 31, 2002 with Beneficiary and/or under the
Promissory Note from EON COMMUNICATIONS CORPORATION to Beneficiary in the principal amount of One Million Four Hundred Thousand and No/100 Dollars ($1,400,000) dated effective June 1, 2002 and currently owes $
                to Beneficiary under said Sublease Termination Agreement and/or said Promissory Note. Beneficiary therefore hereby demands payment and draws said $
                 amount under the Letter of Credit, which amount does not exceed the full remaining undrawn amount of the Letter of Credit.] 
  
 (ii) Ten (10) days or less remains until the expiration date of the Letter of Credit and EON COMMUNICATIONS CORPORATION
remains obligated to maintain a Letter of Credit under the Sublease Termination Agreement dated effective May 31, 2002 between Beneficiary and EON COMMUNICATIONS CORPORATION and has not provided a satisfactory Letter of Credit in the required amount
renewing or replacing the Letter of Credit and currently owes $                 to Beneficiary under said Sublease Termination Agreement and/or the Promissory Note
from EON COMMUNICATIONS CORPORATION to Beneficiary in the principal amount of One Million Four Hundred Thousand and No/100 Dollars ($1,400,000) dated effective June 1, 2002. Beneficiary therefore hereby demands payment and draws said $
                 amount under the Letter of Credit, which amount does not exceed the full remaining undrawn amount of the Letter of Credit.] [add clause (i) or (ii) as
appropriate] 
  
 Payment should be submitted to Beneficiary [by check at the address indicated on the Letter
of Credit] [in immediately available funds by wire transfer to the following account of Beneficiary: 
  
 Name of Bank: 
 Address of Bank: 
 Account No.: 
 Account Name: 
 ABA No.: 
 Reference: ]

 
 15 

  
 IN WITNESS WHEREOF, the undersigned has executed and delivered this Certificate
as of this         day of             ,     . 
  
 
	 TC FOREST HILL DEVELOPMENT, LP
 
	 
	 By:
 	 	 Trammell Crow Tennessee
 Development, Inc., general partner
 
	 
	 By:
 	 	 

	 
	 Title:
 	 	 

	  	 	  

 
  

 
 16

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