Document:

Exhibit 4.1
    

    

    

    
      EXECUTION VERSION
    

    

    

    
      RIGHTS AGREEMENT

by and between

iPARTY
      CORP.

and

    

    
      CONTINENTAL STOCK TRANSFER & TRUST COMPANY

as
      Rights Agent

Dated as of
October 7, 2011
    

    

    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    

    

    
      EXECUTION VERSION
    

    

    

    
      TABLE OF CONTENTS
    

    	
          Section 1.
        	
          Certain Definitions
        	
          1
        
	
          Section 2.
        	
          Appointment of Rights Agent
        	
          7
        
	
          Section 3.
        	
          Issuance of Right Certificates
        	
          8
        
	
          Section 4.
        	
          Form of Right Certificates
        	
          10
        
	
          Section 5.
        	
          Countersignature and Registration
        	
          10
        
	
          
            Section 6.
          

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

        	
          
            11
          

        
	
          Section 7.
        	
          Exercise of Rights; Exercise Price; Expiration Date of Rights
        	
          12
        
	
          Section 8.
        	
          Cancellation and Destruction of Right Certificates
        	
          14
        
	
          Section 9.
        	
          Reservation and Availability of Shares of Preferred Stock.
        	
          14
        
	
          Section 10.
        	
          Preferred Stock Record Date
        	
          15
        
	
          Section 11.
        	
          Adjustment of Exercise Price or Number of Shares
        	
          16
        
	
          Section 12.
        	
          Certification of Adjusted Exercise Price or Number of Shares
        	
          19
        
	
          Section 13.
        	
          Consolidation, Merger or Sale or Transfer of Assets or Earning Power
        	
          19
        
	
          Section 14.
        	
          Fractional Rights and Fractional Shares
        	
          22
        
	
          Section 15.
        	
          Rights of Action
        	
          23
        
	
          Section 16.
        	
          Agreement of Right Holders
        	
          23
        
	
          Section 17.
        	
          Right Certificate Holder Not Deemed a Stockholder
        	
          24
        
	
          Section 18.
        	
          Concerning the Rights Agent
        	
          24
        
	
          Section 19.
        	
          Merger or Consolidation of, or Change in Name of, the Rights Agent
        	
          25
        
	
          Section 20.
        	
          Duties of Rights Agent
        	
          25
        
	
          Section 21.
        	
          Change of Rights Agent
        	
          26
        
	
          Section 22.
        	
          Issuance of New Right Certificates
        	
          27
        

    

    
      
        

        

      

      
        
          i
        

        
          

        

      

      
        

        

      

    

    

    

    	
          Section 23.
        	
          Redemption
        	
          27
        
	
          Section 24.
        	
          Notice of Proposed Actions
        	
          28
        
	
          Section 25.
        	
          Notices
        	
          29
        
	
          Section 26.
        	
          Supplements and Amendments
        	
          30
        
	
          Section 27.
        	
          Successors
        	
          30
        
	
          Section 28.
        	
          Benefits of this Rights Agreement
        	
          30
        
	
          Section 29.
        	
          Delaware Contract
        	
          30
        
	
          Section 30.
        	
          Counterparts
        	
          31
        
	
          Section 31.
        	
          Descriptive Headings
        	
          31
        
	
          Section 32.
        	
          Severability
        	
          31
        

    

    
      

      

      Exhibit A — Summary of Rights
    

    
      Exhibit B — Form of Right Certificate
    

    
      Exhibit C — Form of Certificate of Designations
    

    
      
        

        

      

      
        
          ii
        

        
          

        

      

      
        

        

      

    

    
      EXECUTION VERSION
    

    

    

    
      RIGHTS AGREEMENT
    

    
      Rights Agreement (“Rights Agreement”), dated
      as of October 7, 2011, by and between iParty Corp., a Delaware
      corporation (the “Company”), and Continental
      Stock Transfer & Trust Company, a New York corporation (the “Rights
      Agent”).
    

    
      WITNESSETH:
    

    
      WHEREAS, the Board of Directors of the Company desires to provide
      shareholders of the Company with the opportunity to benefit from the
      long-term prospects and value of the Company and to ensure that
      shareholders of the Company receive fair and equal treatment in the
      event of any proposed takeover of the Company;
    

    
      WHEREAS, in November 2001, the Board approved the Rights
      Agreement dated as of November 9, 2001 (the “2001 Rights
      Agreement”), authorized and declared a dividend distribution of one
      Right for each share of Common Stock (as such term is hereinafter
      defined), par value $.001 per share, and each share of the Company’s
      then outstanding Preferred Stock on an as converted basis outstanding as
      of the close of business on November 9, 2001 (the “2001 Record
      Date”), and authorized the issuance of one Right for each share of
      Common Stock of the Company and Preferred Stock issued between the 2001
      Record Date (whether originally issued or delivered from the Company’s
      treasury) and the earlier of the Distribution Date or the Expiration
      Date, or the Final Expiration Date (as such terms are defined in the
      2001 Rights Agreement), each Right initially representing the right to
      purchase one one-hundredth of a share of Series G Junior Preferred Stock
      of the Company upon the terms and subject to the conditions set forth in
      the 2001 Rights Agreement;
    

    
      WHEREAS, on October 7, 2011, the Board determined that it is
      desirable and in the best interests of the Company and its shareholders
      for the Company to extend the benefits afforded by the 2001 Rights
      Agreement and to implement such extension by executing this Agreement;
      and
    

    
      WHEREAS, on October 7, 2011, the Board of Directors of the
      Company authorized the issuance of, and declared a dividend payable in,
      one right (a “Right”) for each share of the
      Company's Common Stock (as such term is hereinafter defined), par value
      $0.001 per share and each share of the Company's outstanding Preferred
      Stock on an as converted basis (the “Preferred Stock”)
      (the Common Stock and the Preferred Stock shall collectively be
      known as the “Capital Stock”), outstanding as
      of the close of business on November 9, 2011 (the “Record Date”).
      Each such Right represents the right to purchase one one-hundredth
      (1/100) of a share of Series H Junior Preferred Stock of the Company
      (the “Series H Junior Preferred Stock”), having the rights
      and preferences set forth in the form of the Certificate of Designations
      attached hereto as Exhibit C authorized by the Board of Directors
      on October 7, 2011, upon the terms and subject to the conditions
      hereinafter set forth; and
    

    
      WHEREAS, the Board of Directors of the Company further authorized
      the issuance of one Right (subject to adjustment) with respect to each
      share of Capital Stock which may be issued between the Record Date and
      the earlier to occur of the Expiration Date or the Final Expiration Date
      (as such terms are hereinafter defined);
    

    
      
        

        

      

      
        
          1
        

        
          

        

      

      
        

        

      

    

    

    

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

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

    
      (a)       “Acquiring Person”
      shall mean any Person (as such term is hereinafter defined) who or
      which, together with all Affiliates (as such term is hereinafter
      defined) and Associates (as such term is hereinafter defined) of such
      Person, shall be the Beneficial Owner (as such term is hereinafter
      defined) of ten percent (10%) or more of the Voting Stock (as such term
      is hereinafter defined) of the Company then outstanding; provided that,
      an Acquiring Person shall not include (i) an Exempt Person (as such term
      is hereinafter defined), (ii) any Person, together with all Affiliates
      and Associates of such Person, who or which would be an Acquiring Person
      solely by reason of (A) being the Beneficial Owner of shares of Voting
      Stock of the Company, the Beneficial Ownership of which was acquired by
      such Person pursuant to any action or transaction or series of related
      actions or transactions approved by the Board of Directors before such
      Person otherwise became an Acquiring Person, or (B) a reduction in the
      number of issued and outstanding shares of Voting Stock of the Company
      pursuant to a transaction or a series of related transactions approved
      by the Board of Directors of the Company; provided, further, that in the
      event such Person described in this clause (ii) does not become an
      Acquiring Person by reason of subclause (A) or (B) of this clause (ii),
      such Person nonetheless becomes an Acquiring Person in the event such
      Person thereafter acquires Beneficial Ownership of an additional one
      percent (1%) of the Voting Stock of the Company, unless the acquisition
      of such additional Voting Stock would not result in such Person becoming
      an Acquiring Person by reason of subclause (A) or (B) of this
      clause (ii), or (iii) all of the following Persons (together with their
      Affiliates and Associates) the estate of Robert H. Lessin, Robert H.
      Lessin Venture Capital LLC, RHL Ventures, LLC, Roccia Partners, L.P.,
      Boston Millennia Partners, LP, Sal Perisano, or Doris Dionne; provided,
      that such Person (together with such Affiliates and Associates) shall
      become an Acquiring Person in the event such Person hereafter acquires
      Beneficial Ownership of the greater of (A) ten percent (10%) or more of
      the Voting Stock of the Company then outstanding or (B) more than five
      percent (5%) of the Voting Stock of the Company in excess of the amounts
      Beneficially Owned by such Persons (together with their Affiliates and
      Associates) as of the date hereof. Notwithstanding the foregoing, if the
      Board of Directors of the Company determines in good faith that a Person
      who would otherwise be an “Acquiring Person” as defined pursuant to the
      foregoing provisions of this paragraph (a) has become such
      inadvertently, and such Person divests as promptly as practicable (or
      within such period of time as the Board of Directors of the Company
      determines is reasonable) a sufficient number of shares of Voting Stock
      so that such Person would no longer be an “Acquiring Person” as defined
      pursuant to the foregoing provisions of this paragraph (a), then such
      Person shall not be deemed an “Acquiring Person” for any purposes of
      this Rights Agreement.
    

    
      (b)       “Affiliate”
      of a Person shall have the meaning ascribed to such term in Rule
      12b-2 of the General Rules and Regulations under the Securities Exchange
      Act of 1934, as amended (“Exchange Act”), as
      in effect on the date of this Rights Agreement.
    

    
      
        

        

      

      
        
          2
        

        
          

        

      

      
        

        

      

    

    

    

    
      (c)       “Associate”
      of a Person shall mean (i) with respect to a corporation, any
      officer or director thereof or of any Subsidiary (as such term is
      hereinafter defined) thereof, or any Beneficial Owner of ten percent
      (10%) or more of any class of equity security thereof, (ii) with respect
      to a partnership, any general partner thereof or any limited partner
      thereof who is, directly or indirectly, the Beneficial Owner of a ten
      percent (10%) ownership interest therein, (iii) with respect to a
      business trust, any officer or trustee thereof or of any Subsidiary
      thereof or any Beneficial Owner of ten percent (10%) or more of any
      class of beneficial interest therein, (iv) with respect to any
      association other than a corporation, partnership or business trust, any
      officer or director or other person performing similar functions thereof
      or of any Subsidiary thereof or any Beneficial Owner of ten percent
      (10%) or more of the Common Stock (as such term is hereinafter defined)
      of the association, (v) with respect to a trust that is not a business
      trust or an estate, any trustee, executor or similar fiduciary or any
      Person who has a ten percent (10%) or greater interest as a beneficiary
      in the income from or principal of such trust or estate, (vi) with
      respect to a natural person, any relative or spouse of such person, or
      any relative of such spouse, who has the same home as such person, and
      (vii) any Affiliate of such Person.
    

    
      (d)       A Person shall be deemed the “Beneficial
      Owner” of, or to “Beneficially Own,” any
      securities (and correlative terms shall have correlative meanings):
    

    
      (i)  that such Person or any of such Person's Affiliates or Associates
      beneficially owns, directly or indirectly, for purposes of Section 13(d)
      of the Exchange Act and Regulations 13D and 13G thereunder (or any
      comparable or successor law or regulation), in each case as in effect on
      the date hereof; or
    

    
      (ii)  that such Person or any of such Person's Affiliates or Associates
      has (A) the right to acquire (whether such right is exercisable
      immediately or only after the passage of time or the fulfillment of a
      condition or both) pursuant to any agreement, arrangement or
      understanding (whether or not in writing), or upon the exercise of
      conversion rights, exchange rights, other rights (other than these
      Rights), warrants or options, or otherwise; provided, however,
      that a Person shall not be deemed the “Beneficial Owner”
      of, or to “Beneficially Own,” securities tendered pursuant
      to a tender or exchange offer made by such Person or any of such
      Person's Affiliates or Associates until such tendered securities are
      accepted for purchase or exchange, or (B) the right to vote, alone or in
      concert with others, pursuant to any agreement, arrangement or
      understanding (whether or not in writing); provided, however,
      that a Person shall not be deemed the “Beneficial Owner”
      of, or to “Beneficially Own,” any securities if the
      agreement, arrangement or understanding to vote such securities (1)
      arises solely from a revocable proxy or consent given in response to a
      proxy or consent solicitation made pursuant to, and in accordance with,
      the applicable rules and regulations under the Exchange Act, and (2) is
      not at the time reportable by such Person on a Schedule 13D report under
      the Exchange Act (or any comparable or successor report), other than by
      reference to a proxy or consent solicitation being conducted by such
      Person; or
    

    
      
        

        

      

      
        
          3
        

        
          

        

      

      
        

        

      

    

    

    

    
      (iii)  that are beneficially owned, directly or indirectly, by any other
      Person with which such Person or any of such Person's Affiliates or
      Associates has any agreement, arrangement or understanding (whether or
      not in writing) for the purpose of acquiring, holding, voting (except as
      described in clause (B) of subparagraph (ii) of this paragraph (d)) or
      disposing of any securities of the Company; provided, however, that for
      purposes of determining Beneficial Ownership of securities under this
      Rights Agreement, officers and directors of the Company solely by reason
      of their status as such shall not constitute a group (notwithstanding
      that they may be Associates of one another or may be deemed to
      constitute a group for purposes of Section 13(d) of the Exchange Act)
      and shall not be deemed to own shares owned by another officer or
      director of the Company. Notwithstanding anything in this paragraph (d)
      to the contrary, a Person shall not be deemed the “Beneficial
      Owner” of, or to “Beneficially Own,” any security
      beneficially owned by another Person solely by reason of an agreement,
      arrangement or understanding with such other Person for the purposes of:
      (x) soliciting the Company's stockholders for the election of director
      nominees or any other stockholder resolution, the formation of and
      membership on any committee for the purpose of promoting or opposing any
      stockholder resolution or for electing a slate of nominees to the
      Company's Board of Directors, service on such a slate of nominees, or
      agreement to a slate of director nominees, provided, that such
      other Person retains the right at any time to withdraw as a nominee or
      member of any such committee, and to withhold or revoke any vote or
      proxy for or against any such stockholder resolution or for such slate
      of nominees; (y) entering into revocable voting agreements or the
      granting or solicitation of revocable proxies with respect to any of the
      matters described in the foregoing clause (x); or (z) the sharing of
      expenses and the indemnification against expenses and liabilities by any
      such other Person with respect to expenses incurred or conduct occurring
      during the time such other Person is a nominee or a member of any such
      committee described in the foregoing clause (x).
    

    
      (iv)  in respect of which such Person or any of such Person’s Affiliates
      or Associates has a Synthetic Long Position.
    

    
      Further, notwithstanding anything in this paragraph (d) to the
      contrary, a Person engaged in the business of underwriting securities
      shall not be deemed the “Beneficial Owner” of, or to “Beneficially Own,”
      any securities acquired in good faith in a firm commitment underwriting
      until the expiration of forty (40) days after the date of such
      acquisition.
    

    
      
        

        

      

      
        
          4
        

        
          

        

      

      
        

        

      

    

    

    

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

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

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

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

    
      (i)       “Exchange Act”
      shall have the meaning set forth in Section 1(b) hereof.
    

    
      (j)       “Exempt Person”
      shall mean the Company, any Subsidiary of the Company, or any
      employee benefit plan or employee stock plan of the Company or any
      Subsidiary of the Company, or any trust or other entity organized,
      appointed, established or holding Common Stock for or pursuant to the
      terms of any such plan.
    

    
      (k)       “Exercise Price”
      shall have the meaning set forth in Sections 4 and 7(b)
      hereof.
    

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

    
      (m)       “Fair Market Value”
      of any property shall mean the fair market value of such property as
      determined in accordance with Section 11(b) hereof.
    

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

    
      (o)       “Person”
      shall mean any partnership, limited liability company, business
      trust, other association, government entity, estate, trust, foundation
      or natural person and includes without limitation an unincorporated
      group of individuals who, by formal or informal agreement or arrangement
      (whether or not in writing), have embarked on a common purpose or act.
    

    
      
        

        

      

      
        
          5
        

        
          

        

      

      
        

        

      

    

    

    

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

    
      (q)       “Qualifying Tender
      Offer” shall mean a tender or exchange offer for all
      outstanding shares of Capital Stock of the Company not beneficially
      owned by the Person making such offer (or by its Affiliates or
      Associates) approved by a majority of the Board of Directors prior to
      the time that any Person has become an Acquiring Person and after
      receiving the advice of a nationally recognized investment banking firm
      and, after taking into account the potential long-term value of the
      Company and all other factors that they consider relevant.
    

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

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

    
      (t)       “Stock Acquisition
      Date” shall mean the first date on which there shall be
      a public announcement by the Company or an Acquiring Person that an
      Acquiring Person has become such (which, for purposes of this
      definition, shall include, without limitation, a report filed pursuant
      to Section 13(d) of the Exchange Act); provided that if such
      Person is determined not to be or have become an Acquiring Person, then
      no Stock Acquisition Date shall be deemed to have occurred.
    

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

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

    
      (w)       “Synthetic Long
      Position” shall mean, with respect to any security, any option,
      warrant, convertible security, stock appreciation right or other
      contractual right, whether or not presently exercisable, which has an
      exercise or conversion privilege or a settlement payment or mechanism at
      a price related to such security or a value determined in whole or part
      with reference to, or derived in whole or in part from, the market price
      or value of such security (without regard to whether such instrument or
      right (i) conveys any voting power to such Person or any Affiliate or
      Associate thereof, or (ii) is required to be, or is capable of being,
      settled through delivery of such securities) and which increases in
      value as the value of such security increases or which provides to the
      holder of such instrument or right an opportunity, directly or
      indirectly, to profit or share in any profit derived from any increase
      in the value of such security, but shall not include interests in broad
      based index options, broad based index futures, and broad based publicly
      traded market baskets of stocks approved for trading by the appropriate
      federal governmental authority.  The number of securities in respect of
      which a Person has a Synthetic Long Position shall be the notional or
      other number of securities specified in the documentation evidencing the
      Synthetic Long Position as being subject to be acquired upon the
      exercise or settlement of the applicable right or as the basis upon
      which the value or settlement amount of such right or the opportunity of
      the holder of such right to profit or share in any profit, is to be
      calculated in whole or in part or, if no such number of securities is
      specified in such filing or documentation, as determined by the Board in
      good faith to be the number of securities to which the Synthetic Long
      Position relates.
    

    
      
        

        

      

      
        
          6
        

        
          

        

      

      
        

        

      

    

    

    

    
      (x)       “Trading Day”
      shall have the meaning set forth in Section 11(b) hereof.
    

    
      (y)       “Transfer Tax”
      shall mean any tax or charge, including any documentary stamp tax,
      imposed or collected by any governmental or regulatory authority in
      respect of any transfer of any security, instrument or right, including
      Rights, shares of Common Stock and shares of Preferred Stock.
    

    
      (z)       “Voting Stock”
      shall mean (i) the Common Stock of the Company, and (ii) any other
      shares of capital stock of the Company entitled to vote generally in the
      election of directors or entitled to vote together with the Common Stock
      in respect of any merger, consolidation, sale of all or substantially
      all of the Company's assets, liquidation, dissolution or winding up. For
      purposes of this Agreement, a stated percentage of the Voting Stock
      shall mean a number of shares of the Voting Stock as shall equal in
      voting power that stated percentage of the total voting power of the
      then outstanding shares of Voting Stock in the election of a majority of
      the Board of Directors or in respect of any merger, consolidation, sale
      of all or substantially all of the Company's assets, liquidation,
      dissolution or winding up.
    

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

    
      Section 2.          Appointment
      of Rights Agent. The Company hereby appoints the Rights Agent,
      Continental Stock Transfer & Trust Company, to act as agent for the
      Company and the holders of the Rights (who in accordance with Section
      3 hereof, shall prior to the Distribution Date also be the holders
      of the Capital Stock) in accordance with the terms and conditions
      hereof, and the Rights Agent hereby accepts such appointment. The
      Company may from time to time appoint such co-Rights Agents as it may
      deem necessary or desirable. In the event the Company appoints one or
      more co-Rights Agents, the respective duties of the Rights Agents and
      any co-Rights Agents shall be as the Company may determine.  No Rights
      Agent shall have a duty to supervise, and in no event shall be liable
      for, the acts or omissions of any such co-Rights Agent.
    

    
      
        

        

      

      
        
          7
        

        
          

        

      

      
        

        

      

    

    

    

    
                         Section 3.          Issuance
      of Right Certificates.
    

    
      (a)  Upon the request of any holder of record of a Right, the Company or
      the Rights Agent shall send a copy of a Summary of Rights, in
      substantially the form attached hereto as Exhibit A (the “Summary
      of Rights”), by first class mail, postage prepaid, to
      each record holder of the Capital Stock as of the close of business on
      the Record Date, at the address of such holder shown on the records of
      the Company.
    

    
      (b)  Until the close of business on the day which is the earlier of (i)
      the tenth (10th) calendar day after the Stock Acquisition
      Date (or, if the tenth calendar day after the Stock Acquisition Date
      occurs before the Record Date, the Close of Business on the Record
      Date), or (ii) the tenth (10th) business day (or, if such
      tenth Business Day occurs before the Record Date, the Close of Business
      on the Record Date), or such later date as may be determined by action
      of the Board of Directors prior to such time as any Person becomes an
      Acquiring Person after the date of the commencement by any Person (other
      than an Exempt Person), of, or the first public announcement of the
      intent of any Person (other than an Exempt Person) to commence, a tender
      or exchange offer upon the successful consummation of which such Person,
      together with its Affiliates and Associates, would be the Beneficial
      Owner of fifteen percent (15%) or more of the then outstanding shares of
      Voting Stock of the Company (“Non Qualifying Tender Offer”)
      (including any such date which is after the date of this Agreement and
      prior to the issuance of the Rights) (irrespective of whether any shares
      are actually purchased pursuant to any such offer) (the earlier of such
      dates being herein referred to as the “Distribution Date”),
      (x) the Rights shall be evidenced by the certificates for Capital
      Stock registered in the name of the holders of Capital Stock or, with
      respect to shares of Capital Stock of the Company not represented by
      certificates, the Rights related thereto will be evidenced by the
      notation on the records of the Company representing these shares, and in
      each case not by separate Right certificates and the record holders of
      such shares of Capital Stock shall be the record holders of the Rights
      represented thereby, and (y) each Right shall be transferable only
      simultaneously and together with the transfer of a share of Capital
      Stock (subject to adjustment as hereinafter provided). Until the
      Distribution Date (or, if earlier, the Expiration Date or Final
      Expiration Date), the surrender for transfer of any certificate for
      Capital Stock shall constitute the surrender for transfer of the Right
      or Rights associated with the Capital Stock evidenced thereby, whether
      or not accompanied by a copy of the Summary of Rights and the transfer
      of shares of Capital Stock on the records of the Company shall also
      constitute the transfer of the rights associated with such
      shares.  Notwithstanding the foregoing, any right issued under the 2001
      Rights Agreement and any Right issued hereunder in respect of the same
      share of Capital Stock of the Company shall not both be exercisable with
      respect to the same Stock Acquisition Date or Non-Qualifying Tender
      Offer.  
    

    
      (c)  Rights shall be issued in respect of all shares of Capital Stock
      that become outstanding, and in respect of any other securities of the
      Company which are approved by the Board of Directors and by their
      express terms are granted Rights hereunder, after the Record Date but
      prior to the earlier of the Distribution Date, the Expiration Date or
      the Final Expiration Date and, in certain circumstances provided in Section
      22 hereof, may be issued in respect of shares of Capital Stock that
      become outstanding after the Distribution Date. Certificates for Capital
      Stock (including, without limitation, certificates issued upon original
      issuance, disposition from the Company's treasury or transfer or
      exchange of Capital Stock) after the Record Date but prior to the
      earliest of the Distribution Date, the Expiration Date, or the Final
      Expiration Date (or, in certain circumstances as provided in Section
      22 hereof, after the Distribution Date) shall have impressed,
      printed, written or stamped thereon or otherwise affixed thereto a
      legend in a form substantially as follows:
    

    
      
        

        

      

      
        
          8
        

        
          

        

      

      
        

        

      

    

    

    

    
      THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO THE
      SAME NUMBER OF RIGHTS (SUBJECT TO ADJUSTMENT) AS THE NUMBER OF SHARES OF
      CAPITAL STOCK REPRESENTED BY THIS CERTIFICATE, SUCH RIGHTS BEING ON THE
      TERMS PROVIDED UNDER THE RIGHTS AGREEMENT BETWEEN iPARTY CORP. AND
      CONTINENTAL STOCK TRANSFER & TRUST COMPANY (THE “RIGHTS
      AGENT”), DATED AS OF OCTOBER 7, 2011, AS IT MAY BE AMENDED, EXTENDED
      OR RENEWED FROM TIME TO TIME (THE “RIGHTS AGREEMENT”),
      THE TERMS OF WHICH ARE INCORPORATED HEREIN BY REFERENCE AND A COPY
      OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF iPARTY CORP.
      UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, SUCH
      RIGHTS SHALL BE EVIDENCED BY SEPARATE CERTIFICATES AND SHALL NO LONGER
      BE EVIDENCED BY THIS CERTIFICATE. iPARTY CORP. SHALL MAIL TO THE
      REGISTERED HOLDER OF THIS CERTIFICATE A COPY OF THE RIGHTS AGREEMENT
      WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER
      CERTAIN CIRCUMSTANCES AS PROVIDED IN SECTION 7(E) OF THE RIGHTS
      AGREEMENT, RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS
      OR THEIR AFFILIATES OR ASSOCIATES (AS SUCH TERMS  ARE DEFINED IN THE
      RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL
      AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
    

    
      The failure to print the foregoing legend on any such certificate
      representing shares of Capital Stock of the Company or any defect
      therein shall not affect in any manner whatsoever the application or
      interpretation of the provisions of Section 7(e) hereof.
    

    
      (d)  As soon as practicable after the Distribution Date, the Company
      will prepare and execute, the Rights Agent will countersign, and the
      Company will send or cause to be sent (and the Rights Agent will, if
      requested, send), by first class mail, postage prepaid, to each record
      holder of the Capital Stock as of the Close of Business on the
      Distribution Date, as shown by the records of the Company, at the
      address of such holder shown on such records, a certificate in the form
      provided by Section 4 hereof (a “Right Certificate”),
      evidencing one (1) Right (subject to adjustment as provided herein)
      for each share of Capital Stock so held. As of and after the
      Distribution Date, the Rights shall be evidenced solely by Right
      Certificates and may be transferred by the transfer of the Right
      Certificate as permitted hereby, separately and apart from any transfer
      of one or more shares of Capital Stock.
    

    
      
        

        

      

      
        
          9
        

        
          

        

      

      
        

        

      

    

    

    

    
      Section 4.          Form
      of Right Certificates. 
    

    
                (a)       The Right Certificates (and the forms of election to
      purchase shares, certificate and assignment to be printed on the reverse
      thereof), when, as and if issued, shall be substantially in the form set
      forth in Exhibit B hereto and may have such marks of
      identification or designation and such legends, summaries or
      endorsements printed thereon as may be required to comply with any law
      or with any rule or regulation made pursuant thereto or with any rule or
      regulation of any stock exchange on which the Capital Stock or the
      Rights may from time to time be listed or as the Company may deem
      appropriate to conform to usage or otherwise and as are not inconsistent
      with the provisions of this Rights Agreement. Subject to the provisions
      of Section 22 hereof, Right Certificates evidencing Rights
      whenever issued, (i) shall be dated as of the date of issuance of the
      Rights they represent, and (ii) subject to adjustment from time to time
      as provided herein, on their face shall entitle the holders thereof to
      purchase such number of shares (including fractional shares which are
      integral multiples of one one-hundredth (1/100) of a share) of Series H
      Junior Preferred Stock as shall be set forth therein at the price
      payable upon exercise of a Right provided by Section 7(b) hereof
      as the same may from time to time be adjusted as provided herein (the “Exercise
      Price”).
    

    
                (b)       Notwithstanding any other provision of this Rights
      Agreement, any Right Certificate that represents Rights that may be or
      may have been at any time on or after the Distribution Date beneficially
      owned by an Acquiring Person or any Affiliate or Associate thereof (or
      any purported transferee of such Rights) may have impressed on, printed
      on, written on or otherwise affixed to it the following legend:
    

    
      The beneficial owner of the Rights represented by this Right Certificate
      may be an Acquiring Person or an Affiliate or Associate (as defined in
      the Rights Agreement) of an Acquiring Person or a subsequent holder of a
      Right Certificate beneficially owned by such Persons.  Accordingly,
      under certain circumstances as provided in the Rights Agreement, this
      Right Certificate and the Rights represented hereby will be null and
      void.
    

    
                The provisions of this Rights Agreement shall be operative
      whether or not the foregoing legend is imprinted on any such Right
      Certificate.  The Company shall give notice to the Rights Agent promptly
      after it becomes aware of the existence of any Acquiring Person.
    

    
      Section 5.          Countersignature
      and Registration.
    

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

    
      
        

        

      

      
        
          10
        

        
          

        

      

      
        

        

      

    

    

    

    
      (b)  Following the Distribution Date, the Rights Agent will keep or
      cause to be kept, at its principal office or one or more offices
      designated as the appropriate place for surrender of Right Certificates
      upon exercise or transfer, and in such other locations as may be
      required by law, 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, the date of each of the Right Certificates and the
      certificate numbers for each of the Rights Certificates.
    

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

    
      (a)       Subject to the provisions of Sections
      4(b), 7(e), 7(f) and 14 hereof, at any time after the
      Close of Business on the Distribution Date, and at or prior to the Close
      of Business on the earlier of the Expiration Date or the Final
      Expiration Date, any Right Certificate may be (i) transferred, or (ii)
      split up, combined or exchanged for one or more other Right
      Certificates, entitling the registered holder to purchase a like number
      of shares of Series H Junior Preferred Stock as the Right Certificate or
      Rights Certificates surrendered then entitled such holder to purchase.
      Any registered holder desiring to transfer any Right Certificate shall
      surrender the Right Certificate at the office of the Rights Agent
      designated for the surrender of Right Certificates with the form of
      certificate and assignment on the reverse side thereof duly endorsed (or
      enclosed with such Right Certificate a written instrument of transfer in
      form satisfactory to the Company and the Rights Agent), duly executed by
      the registered holder thereof or his or her attorney duly authorized in
      writing, and with such signature duly guaranteed. Any registered holder
      desiring to split up, combine or exchange any Right Certificate shall
      make such request in writing delivered to the Rights Agent, and shall
      surrender the Right Certificate to be split up, combined or exchanged at
      the office of the Rights Agent designated therefor. Thereupon, 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 to
      cover any Transfer Tax that may be imposed in connection with any
      transfer, split up, combination or exchange of any Right
      Certificates.  The Rights Agent shall have no duty or obligation to take
      any action under this Section 6 unless and until the Rights Agent
      is reasonably satisfied that all such Taxes and/or any other charges
      have been paid.
    

    
      (b)       Subject to the provisions of Sections
      7(e), 7(f) and 14 hereof, upon receipt by the Company
      and the Rights Agent of evidence reasonably satisfactory to them of the
      loss, theft, destruction or mutilation of a Right Certificate, and, in
      case of loss, theft or destruction, of indemnity or security reasonably
      satisfactory to them and, if requested by the Company, reimbursement to
      the Company and the Rights Agent of all reasonable expenses incidental
      thereto, or upon surrender to the Rights Agent and cancellation of the
      Right Certificate if mutilated, the Company shall issue and deliver a
      new Right Certificate of like tenor to the Rights Agent for delivery to
      the registered owner in lieu of the Right Certificate so lost, stolen,
      destroyed or mutilated.  Without limiting the foregoing, the Company may
      require the owner of any lost, stolen or destroyed Right Certificate, or
      his legal representative, to give the Company a bond sufficient to
      indemnify the Company against any claim that may be made against it on
      account of the alleged loss, theft or destruction or any such Right
      Certificate or the issuance of any such new Right Certificate.
    

    
      
        

        

      

      
        
          11
        

        
          

        

      

      
        

        

      

    

    

    

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

    
      (a)       The Rights shall not be exercisable until, and shall become
      exercisable on, the Distribution Date (unless otherwise provided herein,
      including, without limitation, the restrictions on exercisability set
      forth in Sections 7(e) and 23(a) hereof). Except as
      otherwise provided herein, the Rights may be exercised, in whole or in
      part, at any time commencing with the Distribution Date upon surrender
      of the Right Certificate, with the form of election to purchase and
      certificate on the reverse side thereof duly executed (with signatures
      duly guaranteed), to the Rights Agent at the principal office of the
      Rights Agent in New York, New York, together with payment of the
      Exercise Price for each Right exercised, subject to adjustment as
      hereinafter provided, at or prior to the Close of Business on the
      earlier of (i) November 9, 2021 (the “Final Expiration Date”),
      or (ii) the date on which the Rights are redeemed as provided in Section
      23 hereof (such earlier date being herein referred to as the “Expiration
      Date”).
    

    
      (b)       The Exercise Price for each one one-hundredth (1/100) of a
      share of Series H Junior Preferred Stock issued pursuant to the exercise
      of a Right shall initially be Two dollars (US$2.00) (the “Exercise
      Price”). The Exercise Price and the number of shares of Series H
      Junior Preferred Stock or other securities to be acquired upon exercise
      of a Right shall be subject to adjustment from time to time as provided
      in Sections 11 and 13 hereof. The Exercise Price shall be
      payable in lawful money of the United States of America, in accordance
      with paragraph (c) below.
    

    
      (c)       Except as otherwise provided herein, upon receipt of a Right
      Certificate representing exercisable Rights with the form of election to
      purchase duly executed, accompanied by payment by certified check,
      cashier's check, bank draft or money order payable to the Rights Agent
      of the Exercise Price for the shares to be purchased and an amount equal
      to any applicable Transfer Tax required to be paid by the holder of the
      Right Certificate in accordance with Section 9(e) hereof, the
      Rights Agent shall thereupon promptly (i) (A) requisition from any
      transfer agent of the Series H Junior Preferred Stock one or more
      certificates representing the number of shares of Series H Junior
      Preferred Stock to be so purchased, and the Company hereby authorizes
      and directs such transfer agent to comply with all such requests, or (B)
      if the Company shall have elected to deposit the total number of shares
      of Series H Junior Preferred Stock issuable upon exercise of the Rights
      hereunder with a depository agent, requisition from the depository agent
      depositary receipts representing interests in such number of one-one
      hundredth of a share of Series H Junior Preferred Stock as are to be
      purchased (in which case certificates for the shares of Series H Junior
      Preferred Shares represented by such receipts shall be deposited by the
      transfer agent of the Series H Junior Preferred Stock with such
      depositary agent) and the Company hereby directs such depositary agent
      to comply with such request;  (ii) as provided in Section
      14(b) hereof, at the election of the Company, cause any fractional
      shares of Series .H Junior Preferred Stock to be rounded up to the
      nearest whole number, and (iii) after receipt of such Series H Junior
      Preferred Stock certificates or depositary receipts, as the case may be,
      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. Notwithstanding the foregoing
      provisions of this Section 7(c), the Company may suspend the
      issuance of shares of Series H Junior Preferred Stock upon exercise of a
      Right for a reasonable period, not in excess of ninety (90) days, during
      which the Company seeks to register under the Securities Act of 1933, as
      amended (the “Securities Act”), and any
      applicable securities law of any other jurisdiction, the shares of
      Series H Junior Preferred Stock to be issued pursuant to the Rights;
      provided, however, that nothing contained in this Section 7(c)
      shall relieve the Company of its obligations under Section 9(c)
      hereof.
    

    
      
        

        

      

      
        
          12
        

        
          

        

      

      
        

        

      

    

    

    

    
      (d)  In case the record 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 his or her assign, subject to the provisions of Section
      14(b) hereof.
    

    
      (e)   Notwithstanding any provision of this Rights Agreement to the
      contrary, from and after the time (the “invalidation time”)
      when any Person first becomes an Acquiring Person, other than
      pursuant to a Qualifying Tender Offer, any Rights that are beneficially
      owned by (x) such Acquiring Person (or any Associate or Affiliate of
      such Acquiring Person), (y) a transferee of such Acquiring Person (or
      any such Associate or Affiliate) who becomes a transferee after the
      invalidation time, or (z) a transferee of such Acquiring Person (or any
      such Associate or Affiliate) who becomes a transferee prior to or
      concurrently with the invalidation time pursuant to either (I) a
      transfer from the Acquiring Person to holders of its equity securities
      or to any Person with whom it has any continuing agreement, arrangement
      or understanding (whether or not in writing) regarding the transferred
      Rights, or (II) a transfer which is part of a plan, arrangement or
      understanding which has the purpose or effect of avoiding the provisions
      of this Section 7(e), and subsequent transferees of such Persons
      referred to in clause (y) and (z) above, shall be void without any
      further action and any holder of such Rights shall thereafter have no
      rights whatsoever with respect to such Rights under any provision of
      this Rights Agreement. The Company shall use all reasonable efforts to
      ensure that the provisions of this Section 7(e) are complied
      with, but shall have no liability to any holder of Right Certificates or
      any other Person as a result of its failure to make any determination
      with respect to an Acquiring Person or its Affiliates, Associates or
      transferees hereunder. No Right Certificate shall be issued pursuant to Section
      3 hereof that represents Rights Beneficially Owned by an Acquiring
      Person whose Rights would be void pursuant to the provisions of this Section
      7(e) or any Associate or Affiliate thereof; no Right Certificate
      shall be issued at any time upon the transfer of any Rights to an
      Acquiring Person whose Rights would be void pursuant to the provisions
      of this Section 7(e) or 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 would be void pursuant to the provisions
      of this Section 7(e) shall be canceled.
    

    
      
        

        

      

      
        
          13
        

        
          

        

      

      
        

        

      

    

    

    

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

    
      (g)       A committee of the Board of Directors of the Company shall
      periodically review this Agreement to consider whether the maintenance
      of this Agreement continues to be in the best interests of the Company
      and its stockholders. The committee shall consist of independent
      directors of the Company and shall conduct such review when, as and in
      such manner as the committee deems appropriate; provided, however, that
      the committee shall take such action at least once every three years.
      Following each such review, the committee will report its conclusions to
      the Board, including any recommendation in light thereof as to whether
      this Agreement should be maintained, modified, terminated or the Rights
      redeemed. The committee is authorized to retain such legal counsel,
      financial advisors and other advisors as the committee deems appropriate
      in order to assist the committee in carrying out its foregoing
      responsibilities under this Agreement.
    

    
      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 canceled
      form, or, if surrendered to the Rights Agent, shall be canceled by it,
      and no Right Certificates shall be issued in lieu thereof except as
      expressly permitted by any of the provisions of this Rights Agreement.
      The Company shall deliver to the Rights Agent for cancellation and
      retirement, and the Rights Agent shall cancel and retire, any Right
      Certificate purchased or acquired by the Company otherwise than upon the
      exercise thereof. The Rights Agent shall deliver all canceled Right
      Certificates to the Company, or shall, at the written request of the
      Company, destroy such canceled Right Certificates, and in such case
      shall deliver a certificate of destruction thereof to the Company.
    

    
      Section 9.           Reservation
      and Availability of Shares of Preferred Stock.
    

    
      (a)  The Company covenants and agrees that it will cause to be reserved
      and kept available out of its authorized and unissued shares of Series H
      Junior Preferred Stock, or out of authorized and issued shares of Series
      H Junior Preferred Stock held in its treasury, such number of shares of
      Series H Junior Preferred Stock as will from time to time be sufficient
      to permit the exercise in full of all outstanding Rights.
    

    
      (b)  The Company shall use its best efforts to cause, from and after
      such time as the Rights become exercisable, all shares of Series H
      Junior Preferred Stock issued or reserved for issuance in accordance
      with this Rights Agreement to be listed, upon official notice of
      issuance, upon the NYSE Amex, NYSE, NASDAQ or another national
      securities exchange.
    

    
      (c)  The Company covenants and agrees that it will take all such action
      as may be necessary to insure that all shares of Series H Junior
      Preferred Stock delivered upon exercise of Rights shall, at the time of
      delivery of the certificates or depositary receipts for such shares
      (subject to payment of the Exercise Price in respect thereof), be duly
      and validly authorized and issued and fully paid and non-assessable
      shares.
    

    
      
        

        

      

      
        
          14
        

        
          

        

      

      
        

        

      

    

    

    

    
      (d)  The Company shall use its best efforts to (i) file, as soon as
      practicable following the occurrence of the event described in Section
      11(a)(ii) hereof, or as soon as is required by law following the
      Distribution Date, as the case may be, a registration statement under
      the Securities Act, with respect to the securities purchasable upon
      exercise of the Rights on an appropriate form, (ii) cause such
      registration statement to become effective as soon as practicable after
      such filing, and (iii) cause such registration statement to remain
      effective (with a prospectus at all times meeting the requirements of
      the Securities Act) until the earlier of (A) the date as of which the
      Rights are no longer exercisable for such securities, and (B) the
      date of the expiration of the Rights. The Company may temporarily
      suspend, for a period of time not to exceed ninety (90) days, the
      issuance of the securities upon exercise of a Right in order to prepare
      and file a registration statement under the Securities Act and permit it
      to become effective. The Company will also take such action as may be
      appropriate under, or to ensure compliance with, the securities or “blue
      sky” laws of the various states in connection with the
      exercisability of the Rights. Notwithstanding any provision of this
      Agreement to the contrary, the Rights shall not be exercisable in any
      jurisdiction unless the requisite qualification in such jurisdiction
      shall have been obtained and until a registration statement under the
      Securities Act (if required) shall have been declared effective.
    

    
      (e)  The Company covenants and agrees that it will pay when due and
      payable any and all federal and state Transfer Taxes which may be
      payable in respect of the issuance or delivery of the Right Certificates
      or of any certificates for any shares of Series H Junior Preferred Stock
      and/or other property issued or delivered upon the exercise of Rights.
      The Company shall not, however, be required to pay any Transfer Tax
      which may be payable in respect of any transfer or delivery of a Right
      Certificate to a Person other than, or the issuance or delivery of
      certificates for Series H Junior Preferred Stock or other securities or
      property upon exercise of Rights in a name other than that of, the
      registered holder of the Right Certificate, and the Company shall not be
      required to issue or deliver a Right Certificate or certificate for
      Series H Junior Preferred Stock to a Person other than such registered
      holder until any such Transfer Tax shall have been paid (any such
      Transfer Tax being payable by the holder of such Right Certificate at
      the time of surrender) or until it has been established to the Company's
      satisfaction that no such Transfer Tax is due.
    

    
      Section 10.         Series
      H Junior Preferred Stock Record Date.  Each Person in whose name
      any certificate for shares of Series H Junior Preferred Stock or other
      securities is issued upon the exercise of Rights shall for all purposes
      be deemed to have become the holder of record of such Series H Junior
      Preferred Stock or such other securities represented thereby on, and
      such certificate shall be dated as of, the date upon which the Right
      Certificate evidencing such Rights was duly surrendered and payment of
      the Exercise Price (and any applicable Transfer Taxes) was made; provided,
      however, that, if the date of such surrender and payment is a
      date upon which the Series H Junior Preferred Stock, or such other
      securities, as applicable, transfer books of the Company are closed,
      such Person shall be deemed to have become the record holder of such
      shares on, and such certificate shall be dated as of, the next
      succeeding Business Day on which the relevant transfer books of the
      Company are open. Prior to the exercise of the Rights evidenced thereby,
      the holder of a Right Certificate, as such, shall not be entitled to any
      rights of a stockholder of the Company with respect to 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.
    

    
      
        

        

      

      
        
          15
        

        
          

        

      

      
        

        

      

    

    

    

    
      Section 11.         Adjustment
      of Exercise Price or Number of Shares.  The Exercise Price and
      the number of shares of Series H Junior Preferred Stock that may be
      purchased upon exercise of a Right are subject to adjustment from time
      to time as provided in this Section 11.
    

    
      (a)  (i) In the event the Company shall at any time after the date of
      this Rights Agreement (A) declare or pay any dividend on the Common
      Stock payable in shares of Common Stock, (B) subdivide or split the
      outstanding shares of Common Stock into a greater number of shares, or
      (C) combine or consolidate the outstanding shares of Common Stock into a
      smaller number of shares or effect a reverse split of the outstanding
      shares of Common Stock, then and in each such event the number of shares
      of Series H Junior Preferred Stock issuable upon the exercise of a Right
      after the record date for such event (if one shall have been established
      or, if not, after the date of such event) shall be the number of shares
      of Series H Junior Preferred Stock issuable immediately prior to such
      event multiplied by a fraction the numerator of which is the number of
      Rights outstanding immediately prior to such event and the denominator
      of which is the number of Rights outstanding immediately after such
      event and the Exercise Price after such event shall be the Exercise
      Price in effect immediately prior to such event multiplied by such
      fraction. If an event occurs which would require an adjustment under
      both this Section 11(a)(i) and Section 11(a)(ii) hereof,
      the adjustment provided for in this Section 11(a)(i) shall be in
      addition to, and shall be made prior to, any adjustment required
      pursuant to Section 11(a)(ii) hereof.
    

    
      (ii)      In the event that any Person (other than an Exempt Person),
      alone or together with its Affiliates and Associates, shall become an
      Acquiring Person, except pursuant to a Qualifying Tender Offer, then,
      subject to the last sentence of Section 23(a) hereof and except
      as otherwise provided in this Section 11, each holder of a Right,
      except as provided in Section 7(e) hereof, shall thereafter have
      the right to receive upon exercise of such Right in accordance with the
      terms of this Rights Agreement and payment of the Exercise Price, the
      greater of (1) the number of one one-hundredths (1/100) of a share of
      Series H Junior Preferred Stock for which such Right was exercisable
      immediately prior to the first occurrence of the event described in this Section
      11(a)(ii), or (2) such number of one one-hundredths (1/100) of a
      share of Series H Junior Preferred Stock, based on the per share Fair
      Market Value of such Series H Junior Preferred Stock (determined
      pursuant to Section 11(b) hereof) on the date of such first
      occurrence, having a value equal to two (2) times the Exercise Price;
      provided, however, that if the transaction that would otherwise give
      rise to the foregoing adjustment is also subject to the provisions of Section
      13 hereof, then only the provisions of Section 13 hereof
      shall apply and no adjustment shall be made pursuant to this Section
      11(a)(ii).
    

    
      
        

        

      

      
        
          16
        

        
          

        

      

      
        

        

      

    

    

    

    
      (iii)     In the event that the Company does not have available
      sufficient authorized but unissued Series H Junior Preferred Stock to
      permit the adjustments required pursuant to the foregoing subparagraph
      (i) or the exercise in full of the Rights in accordance with the
      foregoing subparagraph (ii), the Company shall take all such
      action as may be necessary to authorize and reserve for issuance such
      number of additional shares of Series H Junior Preferred Stock as may
      from time to time be required to be issued upon the exercise in full of
      all Rights from time to time outstanding and, if necessary, shall use
      its best efforts to obtain stockholder approval thereof. In lieu of
      issuing shares of Series H Junior Preferred Stock in accordance with the
      foregoing subparagraphs (i) and (ii), the Company may, if
      the Board of Directors based upon the advice of a nationally recognized
      investment banking firm determines that such action is necessary or
      appropriate and not contrary to the interests of holders of Rights,
      elect to issue or pay, upon the exercise of such Rights, cash, property,
      shares of Series H Junior Preferred Stock or Common Stock, or any
      combination thereof, having an aggregate Fair Market Value equal to the
      Fair Market Value of the shares of Series H Junior Preferred Stock which
      otherwise would have been issuable pursuant to Section 11(a)(ii)
      hereof, which Fair Market Value shall be determined by such nationally
      recognized investment banking firm. For purposes of the preceding
      sentence, the Fair Market Value of the Series H Junior Preferred Stock
      shall be as determined pursuant to Section 11(b) hereof. Subject
      to Section 23 hereof, any such election by the Board of Directors
      of the Company must be made and publicly announced within thirty (30)
      days after the date on which the event described in Section 11(a)(ii) hereof
      occurs.
    

    
      (b)       For the purpose of this Rights Agreement, the “Fair
      Market Value” of any share of Series H Junior Preferred
      Stock, Capital Stock or any other stock or any Right or other security
      or any other property on any date shall be determined as provided in
      this Section 11(b). In the case of a publicly-traded stock or
      other security, the Fair Market Value on any date shall be deemed to be
      the average of the daily closing prices per share of such stock or per
      unit of such other security for the thirty (30) consecutive Trading Days
      (as such term is hereinafter defined) immediately prior to such date;
      provided, however, that in the event that the Fair Market Value per
      share of any share of Capital Stock is determined during a period which
      includes any date that is within thirty (30) Trading Days after (i) the
      ex-dividend date for a dividend or distribution on such stock payable in
      shares of Common Stock or securities convertible into shares of Common
      Stock, or (ii) the effective date of any subdivision, split,
      combination, consolidation, reverse stock split or reclassification of
      such stock, then, and in each such case, the Fair Market Value shall be
      appropriately adjusted to take into account ex-dividend or
      post-effective date trading. 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 applicable transaction reporting
      system with respect to securities listed or admitted to trading on the
      NYSE Amex), or, if the securities are not listed or admitted to trading
      on the NYSE Amex, as reported in the applicable transaction reporting
      system with respect to securities listed on the principal national
      securities exchange on which such security is listed or admitted to
      trading; or, if not listed or admitted to trading on any national
      securities exchange, the last quoted price (or, if not so quoted, the
      average of the high bid and low asked prices) in the over-the-counter
      market, as reported by the National Association of Securities Dealers,
      Inc., Automated Quotations System or such other system then in use; or,
      if no bids for such security are 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 such security. The term “Trading
      Day” shall mean a day on which the principal national
      securities exchange on which such security is listed or admitted to
      trading is open for the transaction of business or, if such security is
      not listed or admitted to trading on any national securities exchange, a
      Business Day. If a security is not publicly held or not so listed or
      traded, “Fair Market Value” shall mean the
      fair value per share of stock or per other unit of such other security,
      as determined by a nationally recognized investment banking firm
      experienced in the valuation of securities; provided, however, that for
      purposes of making the adjustment provided for by Section 11(a)(ii)
      hereof, the Fair Market Value of a share of Series H Junior Preferred
      Stock shall not be less than one hundred percent (100%) of the product
      of the Fair Market Value of a share of Common Stock, as the case may be,
      multiplied by the higher of the then Dividend Multiple or Vote Multiple
      applicable to the Series H Junior Preferred Stock (as such terms are
      defined in the Certificate of Designations relating to the Series H
      Junior Preferred Stock) and shall not exceed one hundred five percent
      (105%) of the product of the then Fair Market Value of a share of Common
      Stock, as the case may be, multiplied by the higher of the then Dividend
      Multiple or Vote Multiple applicable to the Series H Junior Preferred
      Stock. In the case of property other than securities, the “Fair
      Market Value” thereof shall be determined by a nationally recognized
      investment banking firm based upon appraisals or valuation reports
      determined to be appropriate in accordance with good business practices
      and the interests of the holders of Rights. Any such determination of
      Fair Market Value shall be described in a statement filed with the
      Rights Agent and shall be binding upon the Rights Agent.
    

    
      
        

        

      

      
        
          17
        

        
          

        

      

      
        

        

      

    

    

    

    
      (c)  All calculations under this Section 11 shall be
      made to the nearest cent or to the nearest one one-hundredth (1/100) of
      a share, as the case may be.
    

    
      (d)  Irrespective of any adjustment or change in the Exercise Price or
      the number of shares of Series H Junior Preferred Stock issuable upon
      the exercise of the Rights, the Right Certificates theretofore and
      thereafter issued may continue to express the Exercise Price and the
      number of shares to be issued upon exercise of the Rights as in the
      initial Right Certificates issued hereunder but, nevertheless, shall
      represent the Rights as so adjusted.
    

    
      (e)  Before taking any action that would cause an adjustment reducing
      the purchase price per whole share of Series H Junior Preferred Stock
      upon exercise of the Rights below the then par value, if any, of the
      shares of Series H Junior Preferred Stock, the Company shall use its
      best efforts to take any corporate action which may, in the opinion of
      its counsel, be necessary in order that the Company may validly and
      legally issue fully paid and non-assessable shares of such Series H
      Junior Preferred Stock at such adjusted purchase price per share.
    

    
      (f)  Anything in this Section 11 to the contrary
      notwithstanding, in the event of any reclassification of stock of the
      Company or any recapitalization, reorganization or partial liquidation
      of the Company or similar transaction, the Company shall be entitled to
      make such further adjustments in the number of shares of Series H Junior
      Preferred Stock which may be acquired upon exercise of the Rights, and
      such adjustments in the Exercise Price therefor, in addition to those
      adjustments expressly required by the other paragraphs of this Section
      11, as shall be necessary or appropriate in order for the holders of
      such Rights in such event to be treated equitably and in accordance with
      the purpose and intent of this Rights Agreement or in order that any
      such event shall not, but for such adjustment, in the opinion of counsel
      to the Company, result in the stockholders of the Company being subject
      to any United States federal income tax liability by reason thereof.
    

    
      
        

        

      

      
        
          18
        

        
          

        

      

      
        

        

      

    

    

    

    
      (g)       In the event the Company shall at any time after the Record
      Date make any distribution on the shares of Common Stock of the Company,
      whether by way of a dividend or a reclassification of stock, a
      recapitalization, reorganization or partial liquidation of the Company
      or otherwise, in cash or any debt security, debt instrument, real or
      personal property or any other property (other than any shares of Common
      Stock or other capital stock of the Company and other than any right or
      warrant to acquire any such shares, including any debt security
      convertible into or exchangeable for any such share, at less than the
      Fair Market Value of such shares) and the amount of such cash dividend
      or the Fair Market Value of such debt security, debt instrument or
      property exceeds one hundred fifty percent (150%) of the aggregate
      amount of the cash dividends declared or paid on the Common Stock of the
      Company in the fifteen (15) month period immediately preceding such
      distribution, then and in each such event, unless such distribution is
      part of or is made in connection with a transaction to which Section
      11(a)(ii) or Section 13 hereof applies, the Exercise Price
      shall be reduced by an amount equal to the cash or the Fair Market Value
      of such distribution, as the case may be, per share of Common Stock. For
      purposes hereof, the Fair Market Value of any property distributed to
      the holders of shares of Common Stock of the Company shall be the Fair
      Market Value of such property as determined by a nationally recognized
      investment banking firm experienced in the valuation of securities or
      the other property so distributed, as the case may be, whose
      determination shall be final and binding on the Company, the Rights
      Agent and the holders of Rights.
    

    
      Section 12.         Certification
      of Adjusted Exercise Price or Number of Shares.  Whenever
      an adjustment is made as provided in Section 11, 13 or 23(c)
      hereof, the Company shall (a) promptly prepare a certificate setting
      forth such adjustment, and a brief statement of the facts giving rise to
      such adjustment, (b) promptly file with the Rights Agent and with each
      transfer agent for the Series H Junior Preferred Stock 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.
      Notwithstanding the foregoing sentence, the failure of the Company to
      make such certification or give such notice shall not affect the
      validity of or the force or effect of the requirement for such
      adjustment. Any adjustment to be made pursuant to Section 11, 13
      or 23(c) of this Rights Agreement shall be effective as of the
      date of the event giving rise to such adjustment. The Rights Agent shall
      be fully protected in relying on any such certificate and on any
      adjustment therein contained and shall not be deemed to have knowledge
      of any adjustment unless and until it shall have received such
      certificate.
    

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

    
      
        

        

      

      
        
          19
        

        
          

        

      

      
        

        

      

    

    

    

    
      (a)       Except for any transaction approved by the Board of Directors
      prior to such time as any Person becomes an Acquiring Person, in the
      event that, at any time on or after the Distribution Date, (x) the
      Company shall, directly or indirectly, consolidate with, or merge with
      and into, any other Person or Persons (other than an Exempt Person) and
      the Company shall not be the surviving or continuing corporation of such
      consolidation or merger or the Company shall divide into two or more
      corporations and the Company shall not survive the division, or (y) any
      Person or Persons (other than an Exempt Person) shall, directly or
      indirectly, consolidate with, or merge with and into, the Company, and
      the Company shall be the continuing or surviving corporation of such
      consolidation or merger and, in connection with such consolidation or
      merger, all or part of the outstanding shares of Capital Stock shall be
      changed into or exchanged for stock or other securities of any other
      Person (other than an Exempt Person) or of the Company or cash or any
      other property, or (z) the Company or one or more of its Subsidiaries
      shall, directly or indirectly, sell or otherwise transfer to any other
      Person or any Affiliate or Associate of such Person, in one or more
      transactions, or the Company or one or more of its Subsidiaries shall
      sell or otherwise transfer to any Persons in one or a series of related
      transactions, assets or earning power aggregating more than fifty
      percent (50%) of the assets or earning power of the Company and its
      Subsidiaries (taken as a whole), then, on the first occurrence of any
      such event, proper provision shall be made so that (i) each holder of
      record of a Right, except as provided in Section 7(e) hereof,
      shall thereafter have the right to receive, upon the exercise thereof
      and payment of the Exercise Price in accordance with the terms of this
      Rights Agreement, such number of shares of validly issued, fully paid,
      non-assessable and freely tradable Common Stock of the Principal Party
      (as defined herein), not subject to any liens, encumbrances, rights of
      first refusal or other adverse claims, as shall, based on the Fair
      Market Value of the Common Stock of the Principal Party on the date of
      the Consummation of such consolidation, merger, sale or transfer, equal
      to two (2) times the Exercise Price; (ii) such Principal Party shall
      thereafter be liable for, and shall assume, by virtue of such
      consolidation, merger, sale or transfer, all the obligations and duties
      of the Company pursuant to this Rights Agreement; (iii) the term “Company”
      for all purposes of this Rights Agreement shall thereafter be deemed
      to refer to such Principal Party; (iv) such Principal Party shall take
      such steps (including, but not limited to, the reservation of a
      sufficient number of shares of its Common Stock in accordance with the
      provisions of Section 9 hereof applicable to the reservation of
      Series H Junior Preferred Stock) 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 its
      shares of Common Stock thereafter deliverable upon the exercise of the
      Rights; provided, however, that, upon the subsequent occurrence of any
      merger, consolidation, sale of all or substantially all of the assets,
      recapitalization, reclassification of shares, reorganization or other
      extraordinary transaction in respect of such Principal Party, each
      holder of a Right shall thereupon be entitled to receive, upon exercise
      of a Right and payment of the Exercise Price, such cash, shares, rights,
      warrants and other property which such holder would have been entitled
      to receive had it, at the time of such transaction, owned the shares of
      Common Stock of the Principal Party purchasable upon the exercise of a
      Right, and such Principal Party shall take such steps (including, but
      not limited to, reservation of shares of stock) as may be necessary to
      permit the subsequent exercise of the Rights in accordance with the
      terms hereof for such cash, shares, rights, warrants and other property,
      and (v) the provisions of Section 11(a)(ii) hereof shall be of no
      effect following the occurrence of any event described in clause (x),
      (y) or (z) above of this Section 13(a).
    

    
      
        

        

      

      
        
          20
        

        
          

        

      

      
        

        

      

    

    

    

    
      (b)     “Principal Party” shall
      mean
    

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

    
           (ii)  in the case of any transaction described in clause (z) of the
      first sentence in Section 13(a), the Person that is the party
      receiving the greatest portion of the assets or earning power
      transferred pursuant to such transaction or transactions, or, if each
      Person that is a party to such transaction or transactions receives the
      same portion of the assets or earning power so transferred or if the
      Person receiving the greatest portion of the assets or earning power
      cannot be determined, whichever of such Persons as is the issuer of
      Common Stock having the greatest market value of shares outstanding;
      provided, however, that in any such case, if the Common Stock of such
      Person is not at such time and has not been continuously over the
      preceding twelve (12) month period registered under Section 12 of the
      Exchange Act, and such Person is a direct or indirect Subsidiary of
      another Person the Common Stock of which is and has been so registered,
      the term “Principal Party” shall refer to such other
      Person, or if such Person is a Subsidiary, directly or indirectly, of
      more than one Person, the Common Stocks of all of which are and have
      been so registered, the term “Principal Party” shall refer
      to whichever of such Persons is the issuer of the Common Stock having
      the greatest market value of shares outstanding.
    

    
      (c)       The Company shall not consummate any consolidation, merger,
      other fundamental transaction or sale or transfer of assets or earning
      power referred to in Section 13(a) unless the Principal Party
      shall have a sufficient number of authorized shares of its Common Stock
      that have not been issued or reserved for issuance to permit exercise in
      full of all Rights in accordance with this Section 13 and unless
      prior thereto the Company and the Principal Party involved therein shall
      have executed and delivered to the Rights Agent an agreement confirming
      that the Principal Party shall, upon consummation of such consolidation,
      merger, other fundamental transaction or sale or transfer of assets or
      earning power, assume this Rights Agreement in accordance with Section
      13(a) hereof and that all rights of first refusal or preemptive
      rights in respect of the issuance of shares of Common Stock of the
      Principal Party upon exercise of outstanding Rights have been waived and
      that such transaction shall not result in a default by the Principal
      Party under this Rights Agreement, and further providing that, as soon
      as practicable after the date of any consolidation, merger, other
      fundamental transaction or sale or transfer of assets or earning power
      referred to in Section 13(a) hereof, the Principal Party will:
    

    
      
        

        

      

      
        
          21
        

        
          

        

      

      
        

        

      

    

    

    

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

    
            (ii)  use its best efforts to list (or continue the listing of)
      the Rights and the securities purchasable upon exercise of the Rights on
      a national securities exchange; and
    

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

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

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

    
      Section 14.         Fractional
      Rights and Fractional Shares.
    

    
      (a)  The Company shall not be required to issue fractions of Rights or
      to distribute Right Certificates which evidence fractional Rights (i.e.,
      Rights to acquire less than one one-hundredth (1/100) of a share of
      Series H Junior Preferred Stock), unless such fractional Rights result
      from a transaction referred to in Section 11(a)(i) hereof. If the
      Company shall determine not to issue such fractional Rights, then any
      such fractions of Rights shall be rounded up to the nearest whole number.
    

    
      
        

        

      

      
        
          22
        

        
          

        

      

      
        

        

      

    

    

    

    
      (b)  The Company shall not be required to issue fractions of shares of
      Series H Junior Preferred Stock (other than fractions which are integral
      multiples of one-hundredth (1/100) of a share) upon exercise of the
      Rights or to distribute certificates which evidence fractional shares
      (other than fractions which are integral multiples of one-hundredth
      (1/100) of a share). In lieu of issuing fractions of shares of Series H
      Junior Preferred Stock, the Company may, at its election, round up any
      fractions of shares of Series H Junior Preferred Stock to the nearest
      whole number.
    

    
      (c)  The holder of a Right by the acceptance of a Right expressly waives
      his or her right to receive any fractional Right or any fractional
      shares of Series H Junior Preferred Stock (other than fractions which
      are integral multiples of one one-hundredth (1/100) of a share) upon
      exercise of a Right, except as permitted by this Section 14.
    

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

    
      Section 16.         Agreement
      of Right Holders.  Each 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 shall be evidenced
      by the certificates for Capital Stock registered in the name of the
      holders of Capital Stock (together, as applicable, with the Summary of
      Rights), which certificates for Capital Stock shall also constitute
      certificates for Rights, and not by separate Right Certificates, and
      each Right shall be transferable only simultaneously and together with
      the transfer of shares of Capital Stock;
    

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

    
      
        

        

      

      
        
          23
        

        
          

        

      

      
        

        

      

    

    

    

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

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

    
      Section 18.         Concerning
      the Rights Agent.
    

    
      (a)  The Company agrees to pay to the Rights Agent reasonable
      compensation for all services rendered by it hereunder and, from time to
      time, on demand of the Rights Agent, its reasonable expenses and counsel
      fees and other disbursements incurred in the administration and
      execution of this Rights Agreement and the exercise and performance of
      its duties hereunder. The Company also agrees to indemnify the Rights
      Agent for, and to hold it harmless against, any loss, liability, or
      expense, incurred without gross negligence, bad faith or willful
      misconduct on the part of the Rights Agent, for anything done or omitted
      to be done by the Rights Agent in connection with the acceptance and
      administration of this Rights Agreement, including the cost and expenses
      of defending against any claim of liability relating to the Rights or
      this Rights Agreement.
    

    
      (b)  The Rights Agent shall be protected against, and shall incur no
      liability for or in respect of, any action taken, suffered or omitted by
      it in connection with its administration of this Rights Agreement in
      reliance upon any Right Certificate or certificate for Series H Junior
      Preferred Stock or for other securities of the Company, instrument of
      assignment or transfer, power of attorney, endorsement, affidavit,
      letter, notice, direction, consent, certificate, statement or other
      paper or document believed by it to be genuine and to be signed,
      executed and, where necessary, verified or acknowledged, by an officer
      of the Company.
    

    
      (c)  Anything in this Agreement to the contrary notwithstanding, in no
      event shall the Rights Agent be liable for special, indirect or
      consequential loss or damage of any kind whatsoever (including but not
      limited to lost profits), even if the Rights Agent has been advised of
      the likelihood of such loss or damage and regardless of the form of the
      action.
    

    
      
        

        

      

      
        
          24
        

        
          

        

      

      
        

        

      

    

    

    

    
      Section 19.         Merger
      or Consolidation of, or Change in Name of, the Rights Agent.
    

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

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

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

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

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

    
      
        

        

      

      
        
          25
        

        
          

        

      

      
        

        

      

    

    

    

    
      (c)  The Rights Agent shall be liable hereunder only for its own gross
      negligence, bad faith or willful misconduct.
    

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

    
      (e)  The Rights Agent shall not be under any responsibility in respect
      of the validity of this Rights Agreement or the execution and delivery
      hereof (except the due execution hereof by the Rights Agent) or in
      respect of the validity or execution of any Right Certificate (except
      its countersignature thereof); nor shall it be responsible for any
      breach by the Company of any covenant or condition contained in this
      Rights Agreement or in any Right Certificate; nor shall it be
      responsible for any adjustment required under the provisions of Section
      11, 13 or 23(c) hereof or responsible for the manner,
      method or amount of any such adjustment or the ascertaining of the
      existence of facts that would require any such adjustment (except with
      respect to the exercise of Rights evidenced by Right Certificates after
      receipt of a certificate describing any such adjustment); nor shall it
      by any act hereunder be deemed to make any representation or warranty as
      to the authorization or reservation of any shares of Series H Junior
      Preferred Stock to be issued pursuant to this Rights Agreement or any
      Right Certificate or as to whether any shares of Series H Junior
      Preferred Stock will, when issued, be validly authorized and issued,
      fully paid and non-assessable.
    

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

    
      (g)       The Rights Agent is hereby authorized and directed to accept
      instructions with respect to the performance of its duties hereunder
      from the Chief Executive Officer, the President or any Vice President or
      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 to be taken by
      it in good faith in accordance with instructions of any such officer.
    

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

    
      (i)  The Rights Agent may execute and exercise any of the rights or
      powers hereby vested in it or perform any duty hereunder either itself
      or by or through its attorneys or agents.
    

    
      Section 21.         Change
      of Rights Agent.  The Rights Agent or any
      successor Rights Agent may resign and be discharged from its duties
      under this Rights Agreement upon thirty (30) days' notice in writing
      mailed to the Company and to each transfer agent of the Capital Stock
      and the Series H Junior Preferred Stock by registered or certified mail.
      The Company may remove the Rights Agent or any successor Rights Agent
      (with or without cause) upon thirty (30) days' notice in writing, mailed
      to the Rights Agent or successor Rights Agent, as the case may be, and
      to each transfer agent of the Capital Stock and the Series H Junior
      Preferred Stock by registered or certified 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.
      Notwithstanding the foregoing provisions of this Section 21, in
      no event shall the resignation or removal of a Rights Agent be effective
      until a successor Rights Agent shall have been appointed and have
      accepted such appointment. If the Company shall fail to make such
      appointment within a period of thirty (30) days after such removal or
      after it has been notified in writing of such resignation or incapacity
      by the resigning or incapacitated Rights Agent or by the holder of a
      Right Certificate (who shall, with such notice, submit his or her Right
      Certificate for inspection by the Company), then the incumbent Rights
      Agent or the holder of record of any Right Certificate may apply to any
      court of competent jurisdiction for the appointment of a new Rights
      Agent. Any successor Rights Agent, whether appointed by the Company or
      by such a court, shall be (a) a corporation organized and doing
      business under the laws of the United States or of any state
      thereof, in good standing, which is authorized under such laws to exercise
      corporate trust or stock transfer powers and is subject to supervision
      or examination in the conduct of its corporate trust or stock transfer
      business by federal or state authorities and which has at the time of
      its appointment as Rights Agent a combined capital and surplus of at
      least fifty million U.S. dollars (US$50,000,000), or (b) an Affiliate
      controlled by a corporation described in clause (a) of this sentence.
      After appointment, the successor Rights Agent shall be vested with the
      same powers, rights, duties and responsibilities as if it had been
      originally named as Rights Agent without further act or deed, but the
      predecessor Rights Agent shall deliver and transfer to the successor
      Rights Agent any property at the time held by it hereunder, and execute
      and deliver any further assurance, conveyance, act or deed necessary for
      the purpose. Not later than the effective date of any such appointment,
      the Company shall file notice thereof in writing with the predecessor
      Rights Agent and each transfer agent of the Common Stock and Preferred
      Stock, and mail a notice thereof in writing to the registered holders of
      the Right Certificates. Failure to give any notice provided for in this Section
      21, however, or any defect therein, shall not affect the legality or
      validity of the resignation or removal of the Rights Agent or the
      appointment of the successor Rights Agent, as the case may be.
      Notwithstanding the foregoing provisions, in the event of resignation,
      removal or incapacity of the Rights Agent, the Company shall have the
      authority to act as the Rights Agent until a successor Rights Agent
      shall have assumed the duties of the Rights Agent hereunder.
    

    
      
        

        

      

      
        
          26
        

        
          

        

      

      
        

        

      

    

    

    

    
      Section 22.         Issuance
      of New Right Certificates.  Notwithstanding any of the
      provisions of this Rights Agreement or of the Rights to the contrary,
      the Company may, at its option, issue new Right Certificates evidencing
      Rights in such form as may be approved by its Board of Directors to
      reflect any adjustment or change in the Exercise Price per share and the
      number or kind or class of shares of stock or other securities or
      property purchasable under the Right Certificates made in accordance
      with the provisions of this Rights Agreement.
    

    
      Section 23.         Redemption.
    

    
      
        

        

      

      
        
          27
        

        
          

        

      

      
        

        

      

    

    

    

    
      (a)  The Company may, at its option, but only by the vote of a majority
      of the Board of Directors then in office, redeem all but not less than
      all of the then outstanding Rights, at any time prior to the earlier of:
      (i) the Close of Business on the tenth (10) calendar day following the
      Stock Acquisition Date (or, if the Stock Acquisition Date shall have
      occurred prior to the Record Date, the Close of Business on the tenth
      day following the Record Date) and (ii) the Final Expiration Date, at a
      redemption price of $0.001 per Right, subject to adjustments as provided
      in subsection (c) below (the “Redemption Price”).
      Notwithstanding anything contained in this Rights Agreement to the
      contrary, the Rights shall not be exercisable pursuant to Section
      11(a)(ii) hereof prior to the expiration of the Company's right of
      redemption hereunder.
    

    
      (b)  Without any further action and without any notice, the right to
      exercise the Rights will terminate effective at the effective time of
      the action of the Board of Directors ordering the redemption of the
      Rights and the only right thereafter of the holders of Rights shall be
      to receive the Redemption Price. Within ten (10) days after the
      effective time of the action of the Board of Directors ordering the
      redemption of the Rights, the Company shall give notice of such
      redemption to the holders of the then outstanding Rights by mailing such
      notice to all such holders at their last addresses as they appear upon
      the registry books of the Rights Agent or, prior to the Distribution
      Date, on the registry books of the transfer agent for the Common Stock
      and Preferred Stock. Any notice which is mailed in the manner herein
      provided shall be deemed given, whether or not the holder receives the
      notice. Each notice of redemption will state the method by which the
      payment of the Redemption Price will be made. At the option of the Board
      of Directors, the Redemption Price may be paid in cash to each Rights
      holder, by the issuance of shares of Preferred Stock or Common Stock, in
      each case having a Fair Market Value equal to such cash payment or any
      other form of consideration deemed appropriate by the Board and having a
      Fair Market Value equal to such cash payment.
    

    
      (c)  In the event the Company shall at any time after the date of this
      Rights Agreement (A) pay any dividend on the Common Stock in shares of
      Common Stock, (B) subdivide or split the outstanding shares of Common
      Stock into a greater number of shares, or (C) combine or consolidate the
      outstanding shares of Common Stock into a smaller number of shares or
      effect a reverse split of the outstanding shares of Common Stock, then,
      and in each such event, the Redemption Price shall be appropriately
      adjusted; provided, however, that such adjustment to the Redemption
      Price shall be made only if the amount of the Redemption Price shall be
      reduced or increased by at least $0.001 per Right.
    

    
      Section 24.         Notice
      of Proposed Actions.
    

    
      (a)       In case the Company, after the Distribution Date, shall
      propose (i) to effect any of the transactions referred to in Section
      11(a)(i) or 11(g) hereof, (ii) to offer to the holders of
      record of any class of its Common Stock options, warrants, or other
      rights to subscribe for or to purchase shares of its Common Stock
      (including any security convertible into or exchangeable for Common
      Stock) or shares of stock of any class or any other securities, options,
      warrants, convertible or exchangeable securities or other rights, (iii)
      to effect any reclassification of its Series H Junior Preferred Stock or
      Common Stock or any recapitalization or reorganization of the Company,
      (iv) to effect any consolidation or merger with or into, or to effect
      any sale or other transfer (or to permit one or more of its Subsidiaries
      to effect any sale or other transfer), in one or more transactions, of
      more than fifty percent (50%) of the assets or earning power of the
      Company and its Subsidiaries (taken as a whole) to, any other Person or
      Persons, or (v) to effect the liquidation, dissolution or winding up of
      the Company, then, in each such case, the Company shall give to each
      holder of record of a Right Certificate, in accordance with Section 25
      hereof, notice of such proposed action, which shall specify the record
      date for the purposes of such transaction referred to in Section
      11(a)(i) hereof or such dividend or distribution, or the date on
      which such reclassification, recapitalization, reorganization,
      consolidation, merger, sale or transfer of assets, liquidation,
      dissolution, or winding up is to take place and the record date for
      determining participation therein by the holders of record of Common
      Stock or Preferred Stock, if any such date is to be fixed, and such
      notice shall be so given in the case of any action covered by clause (i)
      or (ii) above at least ten (10) days prior to the record date for
      determining holders of record of the Series H Junior Preferred Stock for
      purposes of such action, and in the case of any such other action, at
      least ten (10) days prior to the date of the taking of such proposed
      action or the date of participation therein by the holders of record of
      Capital Stock or Series H Junior Preferred Stock, whichever shall be the
      earlier. The failure to give notice required by this Section 24
      or any defect therein shall not affect the legality or validity of the
      action taken by the Company or the vote upon any such action.
    

    
      
        

        

      

      
        
          28
        

        
          

        

      

      
        

        

      

    

    

    

    
      (b)       In case any of the transactions referred to in Section
      11(a)(i), 11(g) or 13 of this Rights Agreement are
      proposed, then, in any such case, the Company shall give to each holder
      of Rights, in accordance with Section 25 hereof, notice of the
      proposal of such transaction at least ten (10) days prior to
      consummating such transaction, which notice shall specify the proposed
      event and the consequences of the event to holders of Rights under Section
      11(a)(i), 11(g) or 13 hereof, as the case may be, and,
      upon consummating such transaction, shall similarly give notice thereof
      to each holder of Rights.
    

    
      Section 25.         Notices.
      Notices or demands authorized by this Rights Agreement to be given or
      made by the Rights Agent or by the holder of record of any Right
      Certificate or Right to or on 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:
    

    
      iParty Corp.
270 Bridge Street, Suite 301
Dedham, Massachusetts
      02026
Attention: Chief Executive Officer

With a copy to:
Posternak
      Blankstein Lund LLP
The Prudential Tower, 33rd Floor
800
      Boylston Street
Boston, Massachusetts 02199
Attention: Donald H.
      Siegel, P.C.
    

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

    
      
        

        

      

      
        
          29
        

        
          

        

      

      
        

        

      

    

    

    

    
      Continental Stock Transfer & Trust Company
17 Battery Place, 8th
      Floor
New York, New York 10004
Attention: Compliance Department
Tel:
      212-509-4000
    

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

    
      Section 26.         Supplements
      and Amendments.  For as long as the Rights are then redeemable,
      the Company may in its sole and absolute discretion, and the Rights
      Agent shall if the Company so directs, supplement or amend any provision
      of this Agreement without the approval of any holders of the Rights.  At
      any time when the Rights are not then redeemable, the Company may, and
      the Rights Agent shall if the Company so directs, supplement or amend
      this Rights Agreement without the approval of any holders of Right
      Certificates: (i) to cure any ambiguity, (ii) to correct or supplement
      any provision contained herein which may be defective or inconsistent
      with any other provisions herein, or (iii) to change or supplement the
      provisions hereunder in any manner which the Company may deem necessary
      or desirable, provided that no such supplement or amendment pursuant to
      this clause (iii) shall materially adversely affect the interest of the
      holders of Right Certificates (other than an Acquiring Person or any
      Affiliate or Associate of an Acquiring Person). Upon the delivery of a
      certificate from an appropriate officer of the Company which states that
      the proposed supplement or amendment is in compliance with the terms of
      this Section 26, the Rights Agent shall execute such supplement
      or amendment. This Agreement may be amended or supplemented at any time
      with the approval of a majority of the registered holders of the Right
      Certificates (and, prior to the Distribution Date, the Capital Stock).
    

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

    
      Section 28.         Benefits
      of this Rights Agreement.  Nothing in this Rights Agreement
      shall be construed to give to any person or corporation other than the
      Company, the Rights Agent and the registered holders of the Right
      Certificates (and, prior to the Distribution Date, the holders of
      Capital Stock in their capacity as holders of the Rights) any legal or
      equitable right, remedy or claim under this Rights Agreement; but this
      Rights Agreement shall be for the sole and exclusive benefit of the
      Company, the Rights Agent and the holders of record of the Right
      Certificates (and, prior to the Distribution Date, the holders of
      Capital Stock in their capacity as holders of the Rights).
    

    
      Section 29.         Delaware
      Contract. This Rights Agreement and each Right Certificate
      issued hereunder shall be deemed to be a contract made under the laws of
      the State of Delaware and for all purposes shall be governed by and
      construed and enforced in accordance with the laws of such state
      applicable to contracts to be made and performed entirely within such
      state.
    

    
      
        

        

      

      
        
          30
        

        
          

        

      

      
        

        

      

    

    

    

    
      Section 30.         Counterparts.
      This Rights Agreement may be executed in any number of counterparts and
      each of such counterparts shall for all purposes be deemed to be an
      original, and all such counterparts shall together constitute but one
      and the same instrument.
    

    
      Section 31.         Descriptive
      Headings. Descriptive headings of the several Sections of this
      Rights Agreement are inserted for convenience only and shall not control
      or affect the meaning or construction of any of the provisions hereof.
    

    
      Section 32. Severability. If any term, provision, covenant
      or restriction of this Rights Agreement is held by a court of
      competent jurisdiction or other authority to be invalid, void or
      unenforceable, the remainder of the terms, provisions, covenants and
      restrictions of this Rights Agreement shall remain in full force and
      effect and shall in no way be affected, impaired or invalidated; provided,
      however, that notwithstanding anything in this Agreement to the
      contrary, if any such term, provision, covenant or restriction is held
      by such court or authority to be invalid, void or unenforceable and the
      Board of Directors of the Company determines in its good faith judgment
      that severing the invalid language from the Agreement would adversely
      affect the purpose or effect of the Agreement, the right of redemption
      set forth in Section 23 hereof shall be reinstated and shall
      not expire until the Close of Business on the tenth day following the
      date of such determination by the Board of Directors.
    

    
      [THE REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK][THIS PAGE
      INTENTIONALLY LEFT BLANK]
    

    
      

      

      

      

    

    
      
        

        

      

      
        
          31
        

        
          

        

      

      
        

        

      

    

    

    

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

    	

        	
           
        	

        	
           
        	
          iPARTY CORP.
        
	
           
        
	
           
        
	
          Attest:
        	

        	
          
            /s/ David Robertson
          

        	

        	
          By:
        	
          
            /s/ Sal Perisano
          

        
	

        	

        	
          (SEAL)
        	

        	

        	
          
            Name: Sal Perisano
          

        
	

        	

        	

        	

        	

        	
          Title: Chief Executive Officer
        
	
           
        
	
           
        
	

        	

        	

        	

        	
          CONTINENTAL STOCK TRANSFER & TRUST COMPANY
        
	
           
        
	
           
        
	
          Attest:
        	

        	
          
            /s/ John W. Comer, Jr.
          

        	

        	
          By:
        	
          
            /s/ Leslie DeLuca
          

        
	

        	

        	
          (SEAL)
        	

        	

        	
          
            Name: Leslie DeLuca
          

        
	

        	

        	

        	

        	

        	
          
            Title: Vice President
          

        

    

    

    

    
      
        

        

      

      
        
          32
        

        
          

        

      

      
        

        

      

    

    

    

    
      EXHIBIT A
    

    
      SUMMARY OF RIGHTS
    

    
      Term:  10 years
    

    
      Exercise price: $2.00 for each one one-hundredth (1/100) of a
      share of Series H Junior Preferred Stock (the “Preferred Stock”),
      subject to certain antidilution adjustments.
    

    
      Rights detach and become exercisable: Upon the close of business
      on the day which is the earlier of (i) the tenth (10th)
      calendar day following a public announcement that a person or group has
      acquired beneficial ownership of ten percent (10%) or more of the voting
      power of the outstanding Capital Stock of the Company and thereby
      becomes an Acquiring Person (or if the tenth (10) calendar day occurs
      before the record date of the rights, the close of business on the
      record date of the rights), or (ii) the tenth (10th) business
      day (or, if such tenth (10th) business day occurs before the
      record date for the rights, the close of business on the record date for
      such rights) or such later date as may be determined by the Board prior
      to such time as any person or group becomes an Acquiring Person after
      the date of the commencement or announcement of a person's or group's
      intention to commence a tender or exchange offer the consummation of
      which would result in the ownership of fifteen percent (15%) or more of
      the voting power of the Company's outstanding Capital Stock (even if no
      shares are actually purchased pursuant to such offer); prior thereto,
      the Rights would not be exercisable, would not be represented by a
      separate certificate, and would not be transferable apart from the
      Capital Stock. An Acquiring Person would not include (A) the Company,
      (B) any subsidiary of the Company, (C) any employee benefit plan or
      employee stock plan of the Company or of any subsidiary of the Company,
      or any trust or other entity organized, appointed, established or
      holding Capital Stock for or pursuant to the terms of any such plan, or
      (D) any person or group (i) whose ownership of ten percent (10%) or more
      of the voting power of the Capital Stock then outstanding results solely
      from any action, transaction or transactions approved by the Board
      before such person or group became an Acquiring Person, (ii) whose
      ownership of ten percent (10%) or more of voting power of the Capital
      Stock then outstanding results solely from a reduction in the number of
      issued and outstanding shares of Capital Stock pursuant to a transaction
      or transactions approved by the Board (provided that any person or group
      that does not become an Acquiring Person by reason of clause (i) or (ii)
      above shall become an Acquiring Person upon acquisition of an additional
      one percent (1%) of the voting power of the Capital Stock unless such
      acquisition of additional Capital Stock, will not result in such person
      or group becoming an Acquiring Person by reason of such clause (i) or
      (ii)) or (iii) all of the following Persons (together with their
      Affiliates and Associates) the estate of Robert H. Lessin, Robert H.
      Lessin Venture Capital LLC, RHL Ventures, LLC, Roccia Partners, L.P.,
      Boston Millennia Partners, LP, Sal Perisano, or Doris Dionne; provided,
      that such Person (together with such Affiliates and Associates) shall
      become an Acquiring Person in the event such Person hereafter acquires
      Beneficial Ownership of the greater of (A) ten percent (10%) or more of
      the Voting Stock of the Company then outstanding or (B) more than five
      percent (5%) of the Voting Stock of the Company in excess of the amounts
      Beneficially Owned by such Persons (together with their Affiliates and
      Associates) as of the date of the Rights Agreement.
    

    
      
        

        

      

      
        
          33
        

        
          

        

      

      
        

        

      

    

    

    

    
      “Flip-Over”  Feature (protection in a
      merger):    Once the Rights become exercisable, unless they are
      earlier redeemed, if
    

    	
           
        	
          
            (i)
          

        	
          
            the Company were to be merged into or consolidated with another
            entity (whether or not related to a ten percent (10%) stockholder),
          

        
	

        	

        	
           
        
	

        	
          
            (ii)
          

        	
          
            the Company were to merge with another entity (whether or not
            related to a ten percent (10%) stockholder) and be the surviving
            corporation, but any shares of the Company's Capital Stock were
            changed into or exchanged for other securities or assets, or
          

        
	

        	

        	
          
             
          

        
	

        	
          
            (iii)
          

        	
          
            more than fifty percent (50%) of the Company's assets or earning
            power were to be sold in one or a series of related transactions,
          

        

    

    
      then each Right then outstanding would “flip-over” and
      would require that its holder be entitled to buy, at the Exercise Price,
      that number of shares of common stock of the acquiring company which at
      the time of the merger or sale would have a market value of two (2)
      times the exercise price of the Right (i.e., a discount of fifty
      percent (50%)). Thus, if an acquiring company's common stock at the time
      of the merger or sale were trading at $37.50 per share, each Right,
      assuming an exercise price of $75, would entitle its holder to purchase
      four (4) shares of such acquiring company's common stock for such
      exercise price. Any business combination not providing for the issuance
      of common stock of the acquiring company in compliance with such
      provisions would be prohibited.
    

    
      “Flip-In” Feature:  Unless
      the Rights are earlier redeemed, if a person or group becomes an
      Acquiring Person (other than pursuant to a Qualifying Tender Offer),
      each Right not owned by such Acquiring Person would become exercisable,
      at the Exercise Price, for that number of shares of Series H Junior
      Preferred Stock which at the time of such transaction would have a
      market value of two (2) times the Exercise Price of the Right.
    

    
      Redemption:  The Rights would be redeemable by the
      Board at a price of $0.001 per Right at any time prior to the earlier of
      (i) the tenth day following the date on which a person or group acquires
      beneficial ownership of ten percent (10%) or more of the voting power of
      the Company's Capital Stock (or if such tenth day shall have occurred
      prior to the record date for such rights, the close of business on the
      tenth day following the record date for such rights) and (ii) their
      final expiration date. Thus, the Rights would not interfere with a
      negotiated merger or a “white knight” transaction even
      after a tender offer on unfavorable terms had been commenced. Unless
      redeemed, the Rights could, however, interfere with a “white
      knight” transaction which could not be effected by the time a person
      or group acquires beneficial ownership of at least ten percent (10%) of
      the Company's Capital Stock.
    

    
      
        

        

      

      
        
          34
        

        
          

        

      

      
        

        

      

    

    

    

    
      SERIES H JUNIOR PREFERRED STOCK
    

    
      The Company's Series H Junior Preferred Stock purchasable upon exercise
      of the Rights will be non-redeemable. The terms of the Series H Junior
      Preferred Stock as described below will be set forth in a Certificate of
      Designations approved and adopted by resolution of the Board, without
      any action by the stockholders of the Company, pursuant to the power
      vested in the Board in the Company's Restated Certificate of
      Incorporation, as currently in effect. Unless otherwise provided by the
      Board in connection with the creation of a subsequent series of
      preferred stock, the Series H Junior Preferred Stock will be subordinate
      to all other series of the Company's preferred stock.
    

    
      Dividends: Upon issuance, each share of Series H
      Junior Preferred Stock will be entitled to receive when, as and if
      declared, a cash dividend in an amount equal to one hundred (100) times
      the dividend, if any, declared on the Common Stock.
    

    
      Liquidation Preference: In the event of
      liquidation, the holders of the Series H Junior Preferred Stock will be
      entitled to receive a liquidation payment for each share of Series H
      Junior Preferred Stock in an amount equal to the greater of $2.00 per
      one one-hundredth (1/100) share or one hundred (100) times the payment
      made per share of Common Stock.
    

    
      Voting: Each share of Series H Junior Preferred
      Stock will have one hundred (100) votes and will vote together with the
      Common Stock.
    

    
      Mergers, Consolidations, etc.: In the event of any
      merger, consolidation or other transaction in which shares of the
      Company's Common Stock are exchanged, each share of Series H Junior
      Preferred Stock will be entitled to receive one hundred (100) times the
      amount received by each share of Common Stock.
    

    
      Dilution Adjustments: The rights of the Series H
      Junior Preferred Stock as to dividends, liquidation and voting would be
      protected by antidilution provisions.
    

    
      
        

        

      

      
        
          35
        

        
          

        

      

      
        

        

      

    

    

    

    
      EXHIBIT B
    

    
      Form of Right Certificate
    

    
      Certificate No. R-________________ Rights
    

    
      NOT EXERCISABLE AFTER NOVEMBER 9, 2021 OR EARLIER IF REDEEMED. THE
      RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY AND UNDER
      CERTAIN OTHER CIRCUMSTANCES, AT $0.001 PER RIGHT (SUBJECT TO
      ADJUSTMENT), ON THE TERMS SET FORTH OR REFERRED TO IN THE RIGHTS
      AGREEMENT. UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN THE RIGHTS
      AGREEMENT (AS REFERRED TO BELOW), RIGHTS ISSUED TO OR BENEFICIALLY OWNED
      BY ACQUIRING PERSONS OR THEIR AFFILIATES OR ASSOCIATES (AS SUCH TERMS
      ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH
      RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
    

    
      

      

      RIGHT CERTIFICATE

iPARTY CORP.
    

    
      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 7, 2011 (the. “Rights
      Agreement”) between iParty Corp., a Delaware corporation (the “Company”),
      and Continental Stock Transfer & Trust Company, a New York corporation
      (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. (New York time) on November 9, 2021 at
      the office of the Rights Agent designated in the Rights Agreement for
      such purpose, or its successor as Rights Agent, in New York, New York,
      one one-hundredth (1/100) of a fully paid nonassessable share of Series
      H Junior Preferred Stock (the “Series H Junior Preferred Stock”)
      of the Company at a purchase price of Two dollars (US$ 2.00), as the
      same may from time to time be adjusted in accordance with the Rights
      Agreement (the “Exercise Price”), upon presentation and
      surrender of this Right Certificate with the Form of Election to
      Purchase attached hereto duly executed.
    

    
      As provided in the Rights Agreement, the Exercise Price and the number
      of shares of Series H Junior Preferred Stock which may be purchased upon
      the exercise of the Rights evidenced by this Right Certificate are
      subject to modification and adjustment upon the happening of certain
      events and, upon the happening of certain events, securities other than
      shares of Series H Junior Preferred Stock, or other property, may be
      acquired upon exercise of the Rights evidenced by this Right
      Certificate, as provided in the Rights Agreement.
    

    
      
        

        

      

      
        
          36
        

        
          

        

      

      
        

        

      

    

    

    

    
      This Right Certificate is subject to all of the terms, provisions and
      conditions of the Rights Agreement, which terms, provisions and
      conditions are 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 of the Rights Agent, the Company and the holders of
      record of Right Certificates. Copies of the Rights Agreement are on file
      at the principal executive office of the Company.
    

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

    
      Subject to the provisions of the Rights Agreement, the Rights evidenced
      by this Certificate may be redeemed by the Company at its option or
      under certain other circumstances at a redemption price of $0.001 per
      Right.
    

    
      No fractional shares of Series H Junior Preferred Stock (other than
      fractions which are integral multiples of one one-hundredth (1/100) of a
      share) are required to be issued upon the exercise of any Right or
      Rights evidenced hereby, and in lieu thereof the Company may round up
      any fractions to the nearest whole number.
    

    
      No holder of this Right Certificate, as such, shall be entitled to vote
      or receive dividends or be deemed for any purpose the holder of Series H
      Junior Preferred Stock or of any other securities of the Company which
      may at any time be issuable on the exercise hereof, nor shall anything
      contained in the Rights Agreement or herein be construed to confer upon
      the holder hereof, as such, any of the rights of a stockholder of the
      Company or any right to vote for the election of directors or upon any
      matter submitted to stockholders at a 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.
    

    
      
        

        

      

      
        
          37
        

        
          

        

      

      
        

        

      

    

    

    

    
      WITNESS the facsimile signature of the proper officers of the Company
      and its corporate seal. Dated as of___________________ , 2011.
    

    	
          ATTEST:
        	
          iPARTY CORP.
        	

        
	

        	
           
        
	

        	
           
        
	

        	
           
        
	

        	
           
        
	

        	
          By:
        	
          
             
          

        	

        
	
          Secretary
        	

        	
          Sal Perisano
        	

        
	

        	

        	
          Chief Executive Officer
        	

        
	
          Countersigned:
        	

        	

        	

        

    

    
      

      

      CONTINENTAL STOCK TRANSFER & TRUST COMPANY
    

    	
          By:
        	
           
        	

        
	

        	
          Name:
        	

        
	

        	
          Title:
        	

        

    

    

    

    
      
        

        

      

      
        
          38
        

        
          

        

      

      
        

        

      

    

    

    

    
      3
    

    
      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 Certificates.)

    

    
      FOR VALUE
      RECEIVED_____________________________________________________________
    

    
      hereby sells, assigns and transfers
      unto____________________________________________________________________
    

    

    

    
      (Please print name and address of transferee)
    

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

    

    	
          Dated:
        	

        	

        
	

        	
           
        	

        
	

        	
          Signature
        	

        
	

        	

        	
           
        
	
          Signature Guaranteed:
        	

        	

        

    

    

    

    
      
        

        

      

      
        
          39
        

        
          

        

      

      
        

        

      

    

    

    

    
      Certificate
    

    
      The undersigned hereby certifies by checking the appropriate boxes that:
    

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

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

    	
          Dated:
        	
           
        	
           
        	

        	

        
	

        	
           
        	

        	
           
        	

        
	

        	

        	

        	
          Signature
        	

        

    

    

    

    
      

      NOTICE
    

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

    
      
        

        

      

      
        
          40
        

        
          

        

      

      
        

        

      

    

    

    

    
      FORM OF ELECTION TO PURCHASE
    

    
      (To be executed if registered holder
desires to exercise the Right
      Certificate.)
    

    
      TO iPARTY CORP.:
    

    
      The undersigned hereby irrevocably elects to
      exercise__________________________________  Rights represented by this
      Right Certificate to purchase the shares of Series H Junior Preferred
      Stock issuable upon the exercise of such Rights and requests that
      certificates for such share(s) be issued in the following name:
    

    	
          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 must conform in
          

          
            all respects to name of holder
          

          
            as specified on the fact of this
          

          
            Right Certificate)
          

        	

        
	

        	

        	

        	

        	
           
        
	
          Signature Guaranteed:
        	

        	

        	

        

    

    

    

    
      
        

        

      

      
        
          41
        

        
          

        

      

      
        

        

      

    

    

    

    
      EXHIBIT C
    

    
      CERTLFICATE OF THE DESIGNATIONS, POWERS,
PREFERENCES AND RIGHTS
OF
      THE
SERIES H JUNIOR PREFERRED STOCK
(par value $.001 per share)

of

    

    
      iPARTY CORP.
a Delaware Corporation

    

    
      ____________
    

    
      Pursuant to Section 151 of the
General Corporation Law of the
      State of Delaware
    

    
      The undersigned DOES HEREBY CERTIFY that the following resolution
      was duly adopted by the Board of Directors (the "Board of
      Directors") of iParty Corp., a Delaware corporation (the "Company"),
      at a meeting held on October 7, 2011:
    

    
      RESOLVED, that one series of the class of authorized preferred
      stock, $.001 par value, per share of the. Company is hereby created and
      that the designations, powers, preferences and relative, participating,
      optional or other special rights of the shares of such series, and
      qualifications, limitations or restrictions thereof, are hereby fixed as
      follows (this instrument hereinafter referred to as the "Designation"):
    

    
      Section 1.  Designation and Amount.  The shares
      of such series shall be designated as "Series H Junior Preferred
      Stock" and the number of shares constituting such series initially
      shall be 600,000. Notwithstanding the foregoing, however, if more than a
      total of 600,000 shares of Series H Junior Preferred Stock shall be
      issuable upon the exercise of Series H Junior Rights (the "Series
      H Junior Rights") issued pursuant to the Rights Agreement, dated as
      of October 7, 2011, between the Company and Continental Stock Transfer &
      Trust Company, as Rights Agent (as such agreement may be amended from
      time to time, the "Rights Agreement"), the Board of
      Directors of the Company shall direct by resolution or resolutions that
      the total number of shares of Series H Junior Preferred Stock authorized
      to be issued be increased (to the extent that the Certificate of
      Incorporation, as amended, then permits) to the largest number of whole
      shares (rounded up to the nearest whole number) issuable upon exercise
      of such Series H Junior Rights.
    

    
      Section 2. Dividends and Distributions.
    

    
      (a)  Subject to the provisions for adjustment hereinafter set forth, the
      holders of outstanding shares of Series H Junior 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, ratably with
      the holders of Common Stock or other junior securities of the Company,
      cash dividends in an amount per share (rounded to the nearest cent)
      equal to one hundred (100) times the aggregate per share amount of all
      cash dividends declared or paid on the Company's Common Stock, par value
      $0.001 per share (the "Common Stock").  In the event the
      Company shall, at any time after the issuance of any share or fraction
      of a share of Series H Junior Preferred Stock, make any distribution on
      the shares of Common Stock of the Company, whether by way of a dividend
      or a reclassification of stock, a recapitalization, reorganization or
      partial liquidation of the Company or otherwise, which is payable in
      cash or any debt security, debt instrument, real or personal property or
      any other property (other than cash dividends subject to the immediately
      preceding sentence, a distribution of shares of Common Stock or other
      capital stock of the Company or a distribution of rights or warrants to
      acquire any such share, including any debt security convertible into or
      exchangeable for any such share, at a price less than the Fair Market
      Value (as hereinafter defined) of such share) then, and in each such
      event, the Company shall simultaneously pay on each then outstanding
      share of Series H Junior Preferred Stock of the Company a distribution,
      in like kind, of one hundred (100) times such distribution paid on a
      share of Common Stock (subject to the provisions for adjustment
      hereinafter set forth). The dividends and distributions on the Series H
      Junior Preferred Stock to which holders thereof are entitled pursuant to
      the first sentence of this paragraph and pursuant to the second sentence
      of this paragraph are hereinafter referred to as "Dividends"
      and the multiple of such cash and non-cash dividends on the Common Stock
      applicable to the determination of the Dividends, which shall be one
      hundred (100) initially but shall be adjusted from time to time as
      hereinafter provided, is hereinafter referred to as the “Dividend
      Multiple.” In the event the Company shall at any time declare or pay
      any dividend or make any distribution on Common Stock payable in shares
      of Common Stock, or effect a subdivision or split or a combination,
      consolidation or reverse split of the outstanding shares of Common Stock
      into a greater or lesser number of shares of Common Stock, then in each
      such case the Dividend Multiple thereafter applicable to the
      determination of the amount of Dividends which holders of shares of
      Series H Junior Preferred Stock shall be entitled to receive shall be
      the Dividend Multiple applicable immediately prior to such event
      multiplied by a fraction the numerator of which is the number of shares
      of Common Stock outstanding immediately after such event and the
      denominator of which is the number of shares of Common Stock that were
      outstanding immediately prior to such event.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      (b)  The Company shall declare each Dividend at the same time it
      declares any cash or non-cash dividend or distribution on the Common
      Stock in respect of which a Dividend is required to be paid.  No cash or
      non-cash dividend or distribution on the Common Stock in respect of
      which a Dividend is required to be paid shall be paid or set aside for
      payment on the Common Stock unless a Dividend in respect of such
      dividend or distribution on the Common Stock shall be simultaneously
      paid, or set aside for payment, on the Series H Junior Preferred Stock.
    

    
      Section 3.  Votng Rights.  The holders of shares
      of Series H Junior Preferred Stock shall have the following voting
      rights:
    

    
      (a)  Subject to the provisions for adjustment hereinafter set forth,
      each share of Series H Junior Preferred Stock shall entitle the holder
      thereof to one hundred (100) votes on all matters submitted to a vote of
      the holders of the Common Stock. The number of votes which a holder of
      Series H Junior Preferred Stock is entitled to cast, as the same may be
      adjusted from time to time as hereinafter provided, is hereinafter
      referred to as the "Vote Multiple." In the event the Company
      shall at any time declare or pay any dividend on Common Stock payable in
      shares of Common Stock, or effect a subdivision or split or a
      combination, consolidation or reverse split of the outstanding shares of
      Common Stock into a greater or lesser number of shares of Common Stock,
      then in each such case the Vote Multiple thereafter applicable to the
      determination of the number of votes per share to which holders of
      shares of Series H Junior Preferred Stock shall be entitled after such
      event shall be the Vote Multiple immediately prior to such event
      multiplied by a fraction the numerator of which is the number of shares
      of Common Stock outstanding immediately after such event and the
      denominator of which is the number of shares of Capital Stock that were
      outstanding immediately prior to such event.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      (b)  Except as otherwise provided herein, in the Company's Restated
      Certificate of Incorporation or Bylaws, in each case as the same may be
      amended, the holders of shares of Series H Junior Preferred Stock and
      the holders of shares of Common Stock shall vote together as one class
      on all matters submitted to a vote of stockholders of the Company.
    

    
      (c)  Except as otherwise required by the Company's Restated Certificate
      of Incorporation or Bylaws or set forth herein, in each case as the same
      may be amended, holders of Series H Junior Preferred Stock shall have no
      other 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 the taking of any corporate action.
    

    
      Section 4.  Certain Restrictions.
    

    
      (a)  Whenever Dividends on the Series H Junior Preferred Stock are in
      arrears or the Company shall be in default of payment thereof,
      thereafter and until all accrued and unpaid Dividends, whether or not
      declared, on shares of Series H Junior Preferred Stock outstanding shall
      have been paid or set irrevocably aside for payment in full, and in
      addition to any and all other rights which any holder of shares of
      Series H Junior Preferred Stock may have in such circumstances, the
      Company shall not:
    

    
      (i)  declare or pay dividends on, make any other distributions on, or
      redeem or purchase or otherwise acquire for consideration, any shares of
      stock ranking junior (either as to dividends or upon liquidation,
      dissolution or winding up) to the Series H Junior Preferred Stock;
    

    
      (ii)  declare or pay dividends on or make any other distributions on any
      shares of stock ranking on a parity as to dividends with the Series H
      Junior Preferred Stock, unless dividends are paid ratably on the Series
      H Junior Preferred Stock and all such parity stock on which dividends
      are payable or in arrears in proportion to the total amounts to which
      the holders of all such shares are then entitled if the full dividends
      accrued thereon were to be paid;
    

    
      (iii)  except as permitted by subparagraph (iv) of this paragraph
      (a) of this Section 4, redeem or purchase or otherwise
      acquire for consideration shares of any stock ranking on a parity
      (either as to dividends or upon liquidation, dissolution or winding up)
      with the Series H Junior Preferred Stock, provided that the Company may
      at any time redeem, purchase or otherwise acquire shares of any such
      parity stock in exchange for shares of any stock of the Company ranking
      junior (both as to dividends and upon liquidation, dissolution or
      winding up) to the Series H Junior Preferred Stock; or
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

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

    
      (b) Whenever any shares of Series H Junior Preferred Stock are
      outstanding, the Company shall not permit any Subsidiary (as hereinafter
      defined) of the Company to purchase or otherwise acquire for
      consideration any shares of stock of the Company unless the Company
      could, under paragraph (a) of this Section 4, purchase or
      otherwise acquire such shares at such time and in such manner. A
      "Subsidiary" of the Company shall mean any corporation or other entity
      of which securities or other ownership interests having ordinary voting
      power sufficient to elect a majority of the board of directors of such
      corporation or other entity or other persons performing similar
      functions are beneficially owned, directly or indirectly, by the Company
      or by any corporation or other entity that is otherwise controlled by
      the Company.
    

    
      (c)  The Company shall not issue any shares of Series H Junior Preferred
      Stock except upon exercise of Rights issued pursuant to the Rights
      Agreement, a copy of which is on file with the Secretary of the Company
      at its principal executive office and shall be made available to
      stockholders of record without charge upon written request therefor
      addressed to said Secretary. Notwithstanding the foregoing sentence,
      nothing contained in the provisions hereof shall prohibit or restrict
      the Company from issuing for any purpose any series of Preferred Stock
      with rights and privileges similar to, different from, or greater than,
      those of the Series H Junior Preferred Stock.
    

    
      Section 5.  Reacquired Shares.  Any shares of
      Series H Junior Preferred Stock purchased or otherwise acquired by the
      Company in any manner whatsoever shall be retired and canceled promptly
      after the acquisition thereof. All such shares upon their retirement and
      cancellation shall become authorized but unissued shares of Preferred
      Stock, without designation as to series, and such shares may be reissued
      as part of a new series of Preferred Stock to be created by resolution
      or resolutions of the Board of Directors.
    

    
      Section 6.  Liquidation, Dissolution or Winding Up.  Upon
      any voluntary or involuntary liquidation, dissolution or winding up of
      the Company, no distribution shall be made (i) to the holders of shares
      of stock ranking junior (either as to dividends or upon liquidation,
      dissolution or winding up) to the Series H Junior Preferred Stock unless
      the holders of shares of Series H Junior Preferred Stock shall have
      received for each share of Series H Junior Preferred Stock, subject to
      adjustment as hereinafter provided, (A) Two dollars (US$2.00) per one
      one-hundredth (1/100) of a share plus an amount equal to accrued and
      unpaid dividends and distributions thereon, whether or not declared, to
      the date of such payment or, (B) if greater than the amount specified in
      clause (i)(A) of this sentence, an amount equal to one hundred (100)
      times the aggregate amount to be distributed per share to holders of
      Common Stock, as the same may be adjusted as hereinafter provided, and
      (ii) to the holders of stock ranking on a parity upon liquidation,
      dissolution or winding up with the Series H Junior Preferred Stock,
      unless simultaneously therewith distributions are made ratably on the
      Series H Junior Preferred Stock and all other shares of such parity
      stock in proportion to the total amounts to which the holders of shares
      of Series H Junior Preferred Stock are entitled under clause (i)(A) of
      this sentence and to which the holders of such parity shares are
      entitled, in each case upon such liquidation, dissolution or winding
      up.  The amount to which holders of Series H Junior Preferred Stock may
      be entitled upon liquidation, dissolution or winding up of the Company
      pursuant to clause (i)(B) of the foregoing sentence is hereinafter
      referred to as the "Participating Liquidation Amount" and
      the multiple of the amount to be distributed to holders of shares of
      Common Stock upon the liquidation, dissolution or winding up of the
      Company applicable pursuant to said clause to the determination of the
      Participating Liquidation Amount, as said multiple may be adjusted from
      time to time as hereinafter provided, is hereinafter referred to as the "Liquidation
      Multiple." In the event the Company shall at any time declare or pay
      any dividend on Common Stock payable in shares of Common Stock, or
      effect a subdivision or split or a combination, consolidation or reverse
      split of the outstanding shares of Common Stock into a greater or lesser
      number of shares of Common Stock, then, in each such case, the
      Liquidation Multiple thereafter applicable to the determination of the
      Participating Liquidation Amount to which holders of Series H Junior
      Preferred Stock shall be entitled after such event shall be the
      Liquidation Multiple applicable immediately prior to such event
      multiplied by a fraction the numerator of which is the number of shares
      of Common Stock outstanding immediately after such event and the
      denominator of which is the number of shares of Common Stock that were
      outstanding immediately prior to such event.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      Section 7.  Certain Reclassifications and Other Events.
    

    
      (a)  In the event that holders of shares of Common Stock of the Company
      receive, in respect of their shares of Common Stock, any share of
      capital stock of the Company (other than any share of Common Stock of
      the Company), whether by way of reclassification, recapitalization,
      reorganization, dividend or other distribution or otherwise (a "Transaction"),
      then, and in each such event, the dividend rights, voting rights and
      rights upon the liquidation, dissolution or winding up of the Company of
      the shares of Series H Junior Preferred Stock shall be adjusted so that
      after such event the holders of Series H Junior Preferred Stock shall be
      entitled, in respect of each share of Series H Junior Preferred Stock
      held, in addition to such rights in respect thereof to which such holder
      was entitled immediately prior to such adjustment, to (i) such
      additional dividends as equal the Dividend Multiple in effect
      immediately prior to such Transaction multiplied by the additional
      dividends which the holder of a share of Common Stock shall be entitled
      to receive by virtue of the receipt in the Transaction of such capital
      stock, (ii) such additional voting rights as equal the Vote Multiple in
      effect immediately prior to such Transaction multiplied by the
      additional voting rights which the holder of a share of Common Stock
      shall be entitled to receive by virtue of the receipt in the Transaction
      of such capital stock, and (iii) such additional distributions upon
      liquidation, dissolution or winding up of the Company as equal the
      Liquidation Multiple in effect immediately prior to such Transaction
      multiplied by the additional amount which the holder of a share of
      Common Stock shall be entitled to receive upon liquidation, dissolution
      or winding up of the Company by virtue of the receipt in the Transaction
      of such capital stock, as the case may be, all as provided by the terms
      of such capital stock.
    

    
      (b)  In the event that holders of shares of Common Stock of the Company
      receive, in respect of their shares of Common Stock, any right or
      warrant to purchase Common Stock (including as such a right, for all
      purposes of this paragraph, any security convertible into or
      exchangeable for Common Stock) at a purchase price per share less than
      the Fair Market Value of a share of Common Stock on the date of issuance
      of such right or warrant, then and in each such event the dividend
      rights, voting rights and rights upon the liquidation, dissolution or
      winding up of the Company of the shares of Series H Junior Preferred
      Stock shall each be adjusted so that after such event the Dividend
      Multiple, the Vote Multiple and the Liquidation Multiple shall each be
      the product of the Dividend Multiple, the Vote Multiple and the
      Liquidation Multiple, as the case may be, in effect immediately prior to
      such event multiplied by a fraction the numerator of which shall be the
      number of shares of Common Stock outstanding immediately before such
      issuance of rights or warrants plus the maximum number of shares of
      Common Stock which could be acquired upon exercise in full of all such
      rights or warrants and the denominator of which shall be the number of
      shares of Common Stock outstanding immediately before such issuance of
      rights or warrants plus the number of shares of Common Stock which could
      be purchased, at the Fair Market Value of the Common Stock at the time
      of such issuance, by the maximum aggregate consideration payable upon
      exercise in full of all such rights or warrants.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      (c)  In the event that holders of shares of Common Stock of the Company
      receive, in respect of their shares of Common Stock, any right or
      warrant to purchase capital stock of the Company (other than shares of
      Common Stock), including as such a right, for all purposes of this
      paragraph, any security convertible into or exchangeable for capital
      stock of the Company (other than Common Stock), at a purchase price per
      share less than the Fair Market Value of such shares of capital stock on
      the date of issuance of such right or warrant, then and in each such
      event the dividend rights, voting rights and rights upon liquidation,
      dissolution or winding up of the Company of the shares of Series H
      Junior Preferred Stock shall each be adjusted so that after such event
      each holder of a share of Series H Junior Preferred Stock shall be
      entitled, in respect of each share of Series H Junior Preferred Stock
      held, in addition to such rights in respect thereof to which such holder
      was entitled immediately prior to such event, to receive (i) such
      additional dividends as equal the Dividend Multiple in effect
      immediately prior to such event multiplied, first, by the additional
      dividends to which the holder of a share of Common Stock shall be
      entitled upon exercise of such right or warrant by virtue of the capital
      stock which could be acquired upon such exercise and multiplied again by
      the Discount Fraction (as hereinafter defined), and (ii) such additional
      voting rights as equal the Vote Multiple in effect immediately prior to
      such event multiplied, first, by the additional voting rights to which
      the holder of a share of Common Stock shall be entitled upon exercise of
      such right or warrant by virtue of the capital stock which could be
      acquired upon such exercise and multiplied again by the Discount
      Fraction, and (iii) such additional distributions upon liquidation,
      dissolution or winding up of the Company as equal the Liquidation
      Multiple in effect immediately prior to such event multiplied, first, by
      the additional amount which the holder of a share of Common Stock shall
      be entitled to receive upon liquidation, dissolution or winding up of
      the Company upon exercise of such right or warrant by virtue of the
      capital stock which could be acquired upon such exercise and multiplied
      again by the Discount Fraction. For purposes of this paragraph, the "Discount
      Fraction" shall be a fraction the numerator of which shall be the
      difference between the Fair Market Value of a share of the capital stock
      subject to a right or warrant distributed to holders of shares of Common
      Stock of the Company as contemplated by this paragraph immediately after
      the distribution thereof and the purchase price per share for such share
      of capital stock pursuant to such right or warrant and the denominator
      of which shall be the Fair Market Value of a share of such capital stock
      immediately after the distribution of such right or warrant.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      (d)  For purposes of this Certificate of Designations, the "Fair
      Market Value" of a share of capital stock of the Company (including
      a share of Common Stock) on any date shall be deemed to be the average
      of the daily closing price per share thereof over the thirty (30)
      consecutive Trading Days (as such term is hereinafter defined)
      immediately prior to such date; provided, however, that, in the event
      that such Fair Market Value of any such share of capital stock is
      determined during a period which includes any date that is within thirty
      (30) Trading Days after (i) the ex-dividend date for a dividend or
      distribution on stock payable in shares of such stock or securities
      convertible into shares of such stock, or (ii) the effective date of any
      subdivision, split, combination, consolidation, reverse stock split or
      reclassification of such stock, then, and in each such case, the Fair
      Market Value shall be appropriately adjusted by the Board of Directors
      of the Company to take into account ex-dividend or post-effective date
      trading.  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 applicable transaction reporting system with
      respect to securities listed or admitted to trading on the NYSE Amex),
      or, if the shares are not listed or admitted to trading on the NYSE
      Amex, as reported in the applicable transaction reporting system with
      respect to securities listed on the principal national securities
      exchange on which the shares are listed or admitted to trading or, if
      the shares are not listed or admitted to trading on any national
      securities exchange, the last quoted price or, if not so quoted, the
      average of the high bid and low asked prices in the over-the-counter
      market, as reported by the National Association of Securities Dealers,
      Inc., Automated Quotations System or such other system then in use, or
      if on any such date the shares are not quoted by any such organization,
      the average of the closing bid and asked prices as furnished by a
      professional market maker making a market in the shares 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 shares are listed or admitted to trading is open for the
      transaction of business or, if the shares are not listed or admitted to
      trading on any national securities exchange, on which the New York Stock
      Exchange or such other national securities exchange as may be selected
      by the Board of Directors of the Company is open. If the shares are not
      publicly held or not so listed or traded on any day within the period of
      thirty (30) Trading Days applicable to the determination of Fair Market
      Value thereof as aforesaid, "Fair Market Value" shall mean
      the fair market value thereof per share as determined in good faith by
      the Board of Directors of the Company.  In either case referred to in
      the foregoing sentence, the determination of Fair Market Value shall be
      described in a statement filed with the Secretary of the Company.
    

    
      Section 8.  Consolidation. Merger. etc.  In case
      the Company 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 any other
      property, then in any such case each outstanding share of Series H
      Junior Preferred Stock shall at the same time be similarly exchanged for
      or changed into the aggregate amount of stock, securities, cash and/or
      other property (payable in like kind), as the case may be, for which or
      into which each share of Common Stock is changed or exchanged multiplied
      by the highest of the Vote Multiple, the Dividend Multiple or the
      Liquidation Multiple in effect immediately prior to such event.
    

    
      Section 9.  Effective Time of Adjustments.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
      (a)  Adjustments to the Series H Junior Preferred Stock required by the
      provisions hereof shall be effective as of the time at which the event
      requiring such adjustments occurs.
    

    
      (b)  The Company shall give prompt written notice to each holder of a
      share of Series H Junior Preferred Stock of the effect of any adjustment
      to the voting rights, dividend rights or rights upon liquidation,
      dissolution or winding up of the Company of such shares required by the
      provisions hereof.  Notwithstanding the foregoing sentence, the failure
      of the Company to give such notice shall not affect the validity of or
      the force or effect of or the requirement for such adjustment.
    

    
      Section 10.  No Redemption.  The shares of
      Series H Junior Preferred Stock shall not be redeemable at the option of
      the Company or any holder thereof.  Notwithstanding the foregoing
      sentence of this Section, the Company may acquire shares of Series H
      Junior Preferred Stock in any other manner permitted by law, and the
      provisions hereof and the Restated Certificate of Incorporation of the
      Company, in each case as the same may be amended.
    

    
      Section 11.  Ranking.  Unless otherwise provided
      in a Certificate of Designations relating to a subsequent series of
      preferred stock of the Company, the Series H Junior Preferred Stock
      shall rank junior to all other series of the Company's preferred stock
      as to the payment of dividends and the distribution of assets on
      liquidation, dissolution or winding up and senior to the Common Stock.
    

    
      Section 12.         Amendment.  The
      provisions hereof and the Restated Certificate of Incorporation, as
      amended, of the Company shall not be amended in any manner which would
      adversely affect the rights, privileges or powers of the Series H Junior
      Preferred Stock without, in addition to any other vote of stockholders
      required by law, the affirmative vote of the holders of two-thirds (2/3)
      or more of the outstanding shares of Series H Junior Preferred Stock,
      voting together as a single class.
    

    
      IN WITNESS WHEREOF, I have executed and subscribed this
      Certificate of Designations and do affirm the foregoing as true under
      the penalties of perjury this 7th day of October, 2011.
    

    	
           
        	

        	

        	
           
        	
          By:
        	
          
             
          

        
	

        	

        	

        	

        	
          
             
          

        	
          
             
          

        
	

        	

        	

        	

        	
          
             
          

        	
          
             
          

        
	

        	
          ATTEST:
        	

        	

        	

        
	

        	

        	

        	

        	
           
        
	

        	

        	

        	

        	
           
        
	

        	
          By:Exhibit 10.1

                      [ARMADA SPORTS & ENTERTAINMENT LOGO]

                        254 S Ronald Reagan Blvd, Ste 134
                               Longwood, FL 32750
                                  321-295-7816
                               866-773-8630 (efax)

October 7, 2011

Mrs. Mary Beck
Via Email

RE: Letter of Appointment

Dear Mary:

This letter shall constitute as an appointment to the Board of Directors of
Armada Sports & Entertainment (DOMK) as a member. Among other lines of business,
the company is developing a series of golf events known as The Golf
Championships, which are made for television niche sports programming.

The terms of your engagement would be as follows:

1.   The commence date of your engagement as a director would be October 15,
     2011 for a term ending on October 14, 2012.

2.   Your responsibilities as a director shall be to render the following
     services to the Company:

     *    You would attend quarterly telephonic meetings of the board
     *    You would attend in person, the annual meeting of the board
     *    You would attend an initial telephonic conference with other board
          members for introductory purposes
     *    You would leverage and/ or provide opportunities as a result of your
          experience, background and relationships developed over the years to
          maximize the economic benefit to the company and its shareholders.

4.   Your compensation for service as a member of the board will be as follows:
<PAGE>
     *    Cash compensation of $25,000 annually, payable in four quarterly
          installments beginning with the quarter ending January 31, 2012.
     *    Stock compensation of 100,000 shares of restricted common stock. Stock
          options of the company will be granted as determined by mutual
          agreement.
     *    An all-expenses paid trip for you and a Guest to the site of the
          annual meeting of the Board, to be held at the location of one of the
          Company's events.
     *    Future service compensation beyond the term of this appointment will
          be based upon the financial and market status of the company at that
          time.

5.   The Company shall maintain D&O Insurance of $5M during the term of your
     service as a member of the Board of Directors. Upon your acceptance, a copy
     of our D&O binder will be sent to you.

If these terms are acceptable, please indicate your acceptance below and return
to me either by PDF file or by fax to 407-349-1511.

Also, please forward the following when you return the letter acceptance:

A picture and approved bio to be used in our corporate materials. A JPEG or GIF
file is preferred.

I look forward to receiving your acceptance of the appointment and moving
forward on this exciting project with you.

Sincerely,                                   Accepted:

/s/ Tom Kidd                                 /s/ Mary Beck
-----------------------------------          -----------------------------------
Tom Kidd, CEO                                Mary Beck
Chairman

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00194-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00194-of-00352.parquet"}]]