Document:

Unassociated Document

    
      EXHIBIT
        4(e)

       

      
        	
                

                A
                  bank invested in people.

              	
                Huntington
                  Bancshares Incorporated

                Restricted
                  Stock Award Grant Notice

              

      

    

     

     

    RESTRICTED
      STOCK AWARD GRANT NOTICE

     

    
      	 	 	 
	
              Employee
                Name:

            	 	
              Marty
                Adams

            
	 	 	 
	
              Number
                of Shares of Restricted Stock
                Subject to Grant:

            	 	
              $5,038,489
                /
                Fair Market Value of 

              the
                Company's
                common stock

            
	 	 	 
	
              Date
                of Grant:

            	 	
              Effective
                Date

            
	 	 	 

    

     

    
      THIS
        RESTRICTED STOCK AWARD GRANT NOTICE (this “Notice”) is made as of the
        date in the box above labeled “Date of Grant” by Huntington Bancshares
        Incorporated, a Maryland corporation and its subsidiaries (the “Company”), and
        is hereby communicated to the employee named in the box above (the
“Employee”).

      

      WHEREAS,
        under an employment
        agreement between the Company and the Employee dated December 20, 2006 (the
        “Employment Agreement”), the Employee is entitled to receive an amount of
        restricted shares of common stock of the Company (“Restricted Stock”)
        approximately equal in value to $5,038,489 as of the effective
        date of the merger transaction (the “Effective Date”) described in the Agreement
        and Plan of Merger, dated as of December 20, 2006, between the Company, Penguin
        Acquisition, LLC—a wholly owned subsidiary of the Company—and Sky Financial
        Group, Inc. (the “Merger”).

      

      WHEREAS,
        the Company agreed to
        grant an award of Restricted Stock under the Employment Agreement to serve
        as an
        inducement material to the Employee's entering into employment with the Company
        after the Merger.

      

      WHEREAS,
        the Effective Date is
        anticipated to be July 1, 2007.

      

      WHEREAS,
        the Company desires
        to compensate the Employee with a grant of Restricted Stock to satisfy its
        obligations under the Employment Agreement.

      

      NOW,
        THEREFORE, in
        consideration of the premises, the Company grants the Employee an award of
        Restricted Stock under the following terms and conditions:

      

      1.           Grant
        of Restricted Stock.

      

      The
        Company, by authority of its Board of
        Directors (the “Board”), hereby grants to the Employee an award of the number of
        shares of Restricted Stock identified above (the “Grant”) to be issued in
        accordance with all of the terms and conditions set forth in this
        Notice.  For purposes of calculating the number of Shares of
        Restricted Stock identified in the Grant, the term “Fair Market Value” means the
        closing price at which the shares were quoted on the NASDAQ National Market
        or
        such other established securities market on which the shares are traded on
        the
        Date of Grant, or, if there were no reported sales of shares on such date,
        the
        business day immediately preceding the Date of Grant.  The Restricted
        Stock will be issued and registered in the name of the Employee, subject
        to the
        restrictions set forth in this Notice.

      

      2.           Vesting
        and Forfeiture Provisions.

      

      (a)           The
        Employee’s Restricted Stock will vest in equal monthly installments on the last
        day of each calendar month of his employment from the Date of Grant through
        December 31, 2009.  If the 

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      application
        of this
        paragraph results in the Employee vesting in a fraction of a share of the
        Company’s common stock each month, the Company will calculate the sum of the
        fractional shares (the “Fractional Share Sum”), and the Employee will vest in an
        additional whole share of Restricted Stock each month until the amount of
        such
        additional shares of Restricted Stock exceeds the Fractional Share
        Sum.

      

      (b)           Except
        as otherwise provided in Section 2 of this Notice, if the Employee’s employment
        terminates for any reason other than death before all of the Employee’s
        Restricted Stock has become vested under this Notice, the shares of the
        Employee’s Restricted Stock that have not vested shall be forfeited on and after
        the effective date of the termination.  If the Employee incurs a
        termination of employment by reason of death, the Employee shall become
        immediately vested in 100% of the shares of Restricted Stock.

      

      (c)           Notwithstanding
        any provision to the contrary, if the Employee’s employment with the Company is
        terminated (i) involuntarily without Cause (as defined in Section 5(b) of
        the
        Employment Agreement) or (ii) for Good Reason (as defined in Section 5(c)
        of the
        Employment Agreement), the Employee shall become immediately vested in 100%
        of
        the shares of Restricted Stock.

      

      (d)           Notwithstanding
        any provision to the contrary, upon the occurrence of a Change in Control,
        the
        Employee shall become immediately vested in 100% of the shares of Restricted
        Stock.  For purposes of this Notice, a “Change in Control,” with
        respect to the Company, means the occurrence of any of the
        following:

      

      (1)  Any
“person”
(as
        such term is
        used in Sections 13(d) and 14(d) of the Exchange Act as in effect as of the
        date
        of this Agreement), other than the Corporation or any “person” who as of the
        Effective Date is a Director or officer of the Company or whose shares of
        common
        stock of the Company are treated as “beneficially owned” (as such term is used
        in Rule 13d-3 of the Exchange Act as in effect as of the Date of Grant) by
        any
        such director or officer, becomes the beneficial owner, directly or indirectly,
        of securities of the Company representing thirty percent (35%) or more of
        the
        combined voting power of the Company’s then outstanding securities;

      

      (2)  Individuals
        who, as of the Date
        of Grant, constitute the Board of Directors of the Company (the “Incumbent
        Board”) cease for any reason to constitute at least a majority of the Board,
        provided, however, that any individual becoming a director subsequent to
        the
        date hereof whose election, or nomination for election, was approved by a
        vote
        of at least a majority of the directors comprising the Incumbent Board shall
        be
        considered as though such individual were a member of the Incumbent Board,
        but
        excluding for this purpose any such individual whose initial assumption of
        office occurs as a result of either an actual or threatened election contest
        (as
        such terms are used in Regulation 14A promulgated under the Exchange Act)
        or
        other actual or threatened solicitation of proxies or consents by or on behalf
        of a person other than the Board;

      

      (3)  A
        merger or consolidation of the
        Company, other than a merger or consolidation in which the voting securities
        of
        the Company immediately prior to the merger or consolidation continue to
        represent (either by remaining outstanding or being converted into securities
        of
        the surviving entity) fifty-one percent (51%) or more of the combined voting
        power of the Company or surviving entity immediately after the merger or
        consolidation with another entity;

      

      (4)  A
        sale, exchange, lease,
        mortgage, pledge, transfer, or other disposition (in a single transaction
        or a
        series of related transactions) of all or substantially all of the assets
        of the
        Company which shall include, without limitation, the sale of assets or earning
        power aggregating more than fifty percent (50%) of the assets or earning
        power
        of the Company on a consolidated basis;

      

      (5)  A
        liquidation or dissolution of
        the Company;

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      (6)  A
        reorganization, reverse stock
        split, or recapitalization of the Company which would result in any of the
        foregoing; or

      

      (7)  A
        transaction or series of
        related transactions having, directly or indirectly, the same effect as any
        of
        the foregoing.

      

      (e)           The
        Company will not have any further obligations to the Employee under this
        Grant
        if any of the Employee’s shares of Restricted Stock are forfeited as provided
        herein, including the payment of any dividends provided for in this
        Notice.

      

      3.           Certificates
        for Shares of Restricted Stock Granted.  The Company
        shall either issue certificates in respect of the shares of Restricted Stock
        granted to the Employee or hold the shares electronically with its transfer
        agent in the name of the Employee and for the benefit of the Employee until
        the
        shares represented thereby become vested. Such certificates or account shall
        bear the following legend:

      

      "The
        transferability
        of this certificate or account and the shares of stock represented hereby
        are
        subject to an agreement between the Company and the registered holder, a
        copy of
        which is on file at the principal office of this Company."

            

      4.           Issuance
        of Stock.

      

      The
        Company, or its transfer agent, will
        deliver the vested shares of the Restricted Stock and any related stock power
        to
        the Employee as soon as practicable after such shares of Restricted Stock
        become
        vested, subject to payment of the applicable withholding tax liability as
        set
        forth below.  If the Employee dies before the Company has distributed
        any portion of the vested Restricted Stock, the Company will transfer any
        shares
        payable with respect to the vested Restricted Stock in accordance with the
        Employee’s written beneficiary designation or to the Employee’s estate if no
        written beneficiary designation is provided.  If the Employee did not
        have a will, any shares payable with respect to the vested Restricted Stock
        will
        be distributed in accordance with the laws of descent and
        distribution.

      

      5.           Withholding
        Taxes.

      

      The
        Company shall have the power and the right
        to deduct or withhold, or require the Employee to remit to the Company, an
        amount sufficient to satisfy federal, state, local and foreign taxes required
        by
        law or regulation to be withheld with respect to any taxable event arising
        as a
        result of this Notice, including the payment of shares or cash.  With
        regard to the above, the Company is permitted to withhold a number of shares
        having a fair market value equal to Employee’s withholding obligations, based on
        the minimum federal, state and local and other tax withholding rate, and
        to pay
        this amount to the Internal Revenue Service or other taxing authority on
        the
        Employee’s behalf.  Delivery or withholding of fractional shares is
        not permitted, and as such, the Company may round any fractional shares up
        or
        down to the next whole share to satisfy the withholding
        obligations.

      

      6.           Conditions
        to Delivery of Shares.

      

      The
        shares of stock held by the transfer
        agent may be either previously authorized but unissued shares or issued shares
        which have been reacquired by the Company.  The Company shall not be
        required to issue any certificate or certificates for shares of stock hereunder
        prior to fulfillment of all of the following conditions:  (a) the
        admission of such shares to listing on all stock exchanges on which such
        class
        of stock is then listed; (b) the completion of any registration or other
        qualification of such shares under any State or Federal law or under the
        rulings
        or regulations of the Securities and Exchange Commission or any other
        governmental regulatory body, which the Committee shall, in its absolute
        discretion, deem necessary or advisable; (c) the obtaining of any approval
        or
        other clearance from any 

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      State
        or Federal governmental agency,
        which the Committee shall, in its absolute discretion, determine to be necessary
        or advisable; (d) the lapse of such reasonable period of time following the
        Date
        of Grant and during which the Compensation Committee of the Company’s Board of
        Directors (the “Committee”) reasonably believes that the issuance of shares
        would violate any applicable laws, government regulations, requirements of
        any
        securities exchange on which the Corporation’s Shares are traded, or any insider
        trading policy of the Corporation; and (e) the lapse of such reasonable period
        of time following the date of grant of the shares of Restricted Stock as
        the
        Committee may establish from time to time for reasons of administrative
        convenience.

      

      7.           Restriction
        on Transferability.

      

      Until
        the shares of Restricted Stock have
        vested under this Notice, the Restricted Stock granted herein and the rights
        and
        privileges conferred hereby may not be sold, transferred, pledged, assigned,
        or
        otherwise alienated or hypothecated (by operation of law or
        otherwise).  Any attempted transfer in violation of the provisions of
        this paragraph shall be void, and the purported transferee shall obtain no
        rights with respect to such Restricted Stock.

      

      8.           Rights
        as Stockholder.

      

      Subject
        to the limitations provided in this
        Notice, the Employee shall have all the rights of a stockholder of the Company,
        including voting rights and the right to receive dividends with respect to
        shares of Restricted Stock that have not yet vested.

      

      9.           Capital
        Adjustment Provisions.

      

      In
        the event of a stock split, stock dividend,
        reclassification, reorganization, redesignation, or other change in the
        Company’s capitalization or corporate structure, the number and class of shares
        of Restricted Stock shall be proportionately adjusted or substituted to reflect
        such change.

      

      10.           Employment
        Under the Employment
        Agreement.

      

      The
        Employee understands and agrees that his
        employment with the Company is determined under the Employment
        Agreement.

      

      11.           Authority
        of the Compensation Committee.

      

      The
        Compensation Committee of the Company’s
        Board of Directors (the “Committee”) shall have the power to construe and
        interpret the provisions of this Notice and may correct any defect, supply
        any
        omission or reconcile any inconsistency in the Notice in the manner and to
        the
        extent it shall deem desirable to carry the Notice into
        effect.  Further, the Committee shall make all other determinations
        which may be necessary or advisable for the administration of the
        Notice.  All determinations and decisions made by the Committee shall
        be final, conclusive, and binding on all persons, including the Company,
        the
        Employee, and the Employee’s estate and beneficiaries.

      

      12.           Addresses
        for Notices.

      

      Any
        notice to be given to the Company under the
        terms of this Notice shall be addressed to the Company, in care of the
        Compensation Director, at Huntington Bancshares Incorporated, Huntington
        Center,
        HC0318, 41 S. High Street, Columbus, Ohio  43287, or at such other
        address as the Company may hereafter designate in writing.  Any notice
        to be given to the Employee shall be addressed to the Employee at the address
        maintained on the books and records of the Company.

      

      13.           Captions.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      Captions
        provided herein are for convenience
        only and are not to serve as a basis for interpretation or construction of
        this
        Notice.

      

      14.           Notice
        Severable.

      

      In
        the event that any provision in this Notice
        shall be held invalid or unenforceable, such provision shall be severable
        from,
        and such invalidity or unenforceability shall not be construed to have any
        effect on, the remaining provisions of this Notice.

      

      15.           Expenses.

      

      Costs
        of administration of the terms and
        conditions of this Notice will be paid by the Company.

      

      16.           Governing
        Law.

      

      The
        terms and conditions of this Notice shall
        be governed by the laws of the State of Ohio, except to the extent preempted
        by
        federal law.

      

      17.           Entire
        Notice; Amendment.

      

      This
        Notice contains the terms and conditions
        with respect to the subject matter hereof and supersede any previous agreements,
        written or oral, relating to the subject matter hereof.   The
        Company may not amend, alter, suspend, discontinue or terminate any provision
        of
        this Notice in a manner that may adversely affect the Employee without the
        Employee’s (or his legal representative’s) written consent.

      

      18.           Employee’s
        Acceptance.

      

      The
        Employee shall signify his acceptance of
        the terms and conditions of this Notice by signing in the space provided
        below,
        by signing any related stock power, and by returning a signed copy of these
        documents to the Company.

      

      Please
        retain this
        Notice, as it is the official statement of the key terms of your
        award.  If you have any questions regarding the administration of this
        Notice, please contact Joan Snyder at (614) 480-4885 or Holly Bush at (614)
        480-3011.

       

      
         

        
          	
                  /s/
                    Thomas E.
                    Hoaglin

                	 	
                  June
                    26,
                    2007

                	 
	Thomas
                  E.
                  Hoaglin	 	
                  Date

                	 
	
                  Chairman,
                    President and Chief Executive Officer

                	 	
                   

                	 

        

        

         

        
          	/s/
                  Marty E.
                  Adams	 	
                  July
                    2,
                    2007

                	 
	
                  Marty
                    E.
                    Adams

                	 	
                  Date

                	 

        

        
 

        5EX-4.1

 

Exhibit 4.1

 

STOCKHOLDER PROTECTION RIGHTS AGREEMENT

dated as of

July 3, 2007

between

Vertrue Incorporated

and

American Stock Transfer & Trust Company,

as Rights Agent

 

 

 

Table of Contents

	 	 	 	 	 
	 	 	Page
	ARTICLE I

	 
	 	 	 	 
	DEFINITIONS

	 
	 	 	 	 
	1.1 Definitions
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II

	 
	 	 	 	 
	THE RIGHTS

	 
	 	 	 	 
	2.1 Summary of Rights
	 	 	13	 
	2.2 Legend on Common Stock Certificates
	 	 	13	 
	2.3 Exercise of Rights; Separation of Rights
	 	 	15	 
	2.4 Adjustments to Exercise Price; Number of Rights
	 	 	18	 
	2.5 Date on Which Exercise is Effective
	 	 	20	 
	2.6 Execution, Authentication, Delivery and Dating of Rights Certificates
	 	 	21	 
	2.7 Registration, Registration of Transfer and Exchange
	 	 	22	 
	2.8 Mutilated, Destroyed, Lost and Stolen Rights Certificates
	 	 	23	 
	2.9 Persons Deemed Owners
	 	 	24	 
	2.10 Delivery and Cancellation of Certificates
	 	 	25	 
	2.11 Agreement of Rights Holders
	 	 	25	 
	 
	 	 	 	 
	ARTICLE III

	 
	 	 	 	 
	ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS

	 
	 	 	 	 
	3.1 Flip-in
	 	 	26	 
	3.2 Flip-over
	 	 	30	 
	 
	 	 	 	 
	ARTICLE IV

	 
	 	 	 	 
	THE RIGHTS AGENT

	 
	 	 	 	 
	4.1 General
	 	 	32	 
	4.2 Merger or Consolidation or Change of Name of Rights Agent
	 	 	33	 
	4.3 Duties of Rights Agent
	 	 	34	 
	4.4 Change of Rights Agent
	 	 	37	 

 

 

	 	 	 	 	 
	 	 	Page
	ARTICLE V

	 
	 	 	 	 
	MISCELLANEOUS

	 
	 	 	 	 
	5.1 Redemption
	 	 	38	 
	5.2 Expiration
	 	 	39	 
	5.3 Issuance of New Rights Certificates
	 	 	39	 
	5.4 Supplements and Amendments
	 	 	40	 
	5.5 Fractional Shares
	 	 	41	 
	5.6 Rights of Action
	 	 	41	 
	5.7 Holder of Rights Not Deemed a Stockholder
	 	 	42	 
	5.8 Notice of Proposed Actions
	 	 	42	 
	5.9 Notices
	 	 	42	 
	5.10 Suspension of Exercisability
	 	 	43	 
	5.11 Costs of Enforcement
	 	 	44	 
	5.12 Successors
	 	 	44	 
	5.13 Benefits of this Agreement
	 	 	44	 
	5.14 Determination and Actions by the Board of Directors, etc
	 	 	44	 
	5.15 Descriptive Headings; Section References
	 	 	45	 
	5.16 Governing Law
	 	 	45	 
	5.17 Counterparts
	 	 	45	 
	5.18 Severability
	 	 	46	 

EXHIBITS

	 	 	 
	Exhibit A

	 	Form of Rights Certificate (Together with Form of Election to
Exercise)
	 
	 	 
	Exhibit B

	 	Form of Certificate of Designation and Terms of Participating
Preferred Stock

 

 

     STOCKHOLDER PROTECTION RIGHTS AGREEMENT (as amended from time to time, this “Agreement”),
dated as of July 3, 2007, between Vertrue Incorporated, a Delaware corporation (the “Company”), and
American Stock Transfer & Trust Company, a New York corporation, as Rights Agent (the “Rights
Agent”, which term shall include any successor Rights Agent hereunder).

WITNESSETH:

     WHEREAS, the Board of Directors of the Company has (a) authorized and declared a dividend of
one right (“Right”) in respect of each share of Common Stock (as hereinafter defined) held of
record as of the Close of Business (as hereinafter defined) on July 16, 2007 (the “Record Time”)
payable in respect of each such share upon certification by The NASDAQ Stock Market LLC (“NASDAQ”)
to the Securities and Exchange Commission that the Rights have been approved for listing and
registration (the “Payment Time”) and (b) as provided in Section 2.4, authorized the issuance of
one Right in respect of each share of Common Stock issued after the Record Time and prior to the
Separation Time (as hereinafter defined) and, to the extent provided in Section 5.3, each share of
Common Stock issued after the Separation Time;

     WHEREAS, subject to the terms and conditions hereof, each Right entitles the holder thereof,
after the Separation Time, to purchase securities or assets of the Company (or, in certain cases,
securities of certain other entities) pursuant to the terms and subject to the conditions set forth
herein; and

     WHEREAS, the Company desires to appoint the Rights Agent to act on behalf of the Company, and
the Rights Agent is willing so to act, in connection with the

 

 

issuance, transfer, exchange and replacement of Rights Certificates (as hereinafter defined),
the exercise of Rights and other matters referred to herein.

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

ARTICLE I

DEFINITIONS

     1.1 Definitions. For purposes of this Agreement, the following terms have the
meanings indicated:

     “Acquiring Person” shall mean any Person who is or becomes the Beneficial Owner of 15% or more
of the outstanding shares of Common Stock; provided, however, that the term
“Acquiring Person” shall not include (a) the Company; (b) any Subsidiary of the Company; (c) any
employee stock ownership or other employee benefit plan of the Company or a Subsidiary of the
Company (or any entity or trustee holding shares of Common Stock for or pursuant to the terms of
any such plan or for the purpose of funding any such plan or funding other employee benefits for
employees of the Company or of any Subsidiary of the Company); or (d) any Person (i) who shall
become the Beneficial Owner of 15% or more of the outstanding shares of Common Stock solely as a
result of a reduction in the number of shares of Common Stock outstanding due to an acquisition by
the Company of shares of Common Stock, until such time thereafter as such Person shall become the
Beneficial Owner (other than by means of a stock dividend or stock split) of any additional shares
of Common Stock while such Person is or as a result of which such Person becomes the Beneficial
Owner of 15% or more of the outstanding shares of Common Stock, (ii) who (in the good faith
determination of the

-2-

 

Board of Directors of the Company) becomes the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock but who acquired Beneficial Ownership of shares of Common Stock
without any plan or intention to seek or affect control of the Company, if such Person promptly
divests, or promptly enters into an agreement with, and satisfactory to, the Company, in its sole
discretion, to divest and thereafter promptly divests (in each case without exercising or retaining
any power, including voting power, with respect to such shares), sufficient shares of Common Stock
(or securities convertible into, exchangeable into or exercisable for Common Stock) so that such
Person ceases to be the Beneficial Owner of 15% or more of the outstanding shares of Common Stock,
(iii) who Beneficially Owns shares of Common Stock consisting solely of one or more of (A) shares
of Common Stock Beneficially Owned pursuant to the grant or exercise of an option granted to such
Person (an “Option Holder”) by the Company in connection with an agreement to merge with, or
acquire, the Company entered into prior to the time such Person becomes a Beneficial Owner of 15%
or more of the outstanding shares of Common Stock, (B) shares of Common Stock (or securities
convertible into, exchangeable into or exercisable for Common Stock) Beneficially Owned by such
Option Holder or its Affiliates or Associates at the time of grant of such option and (C) shares of
Common Stock (or securities convertible into, exchangeable into or exercisable for Common Stock)
acquired by Affiliates or Associates of such Option Holder after the time of such grant that, in
the aggregate, amount to less than 1% of the outstanding shares of Common Stock, or (iv) Brencourt
Advisors, LLC (“Brencourt”) but only to the extent Brencourt is or becomes the Beneficial Owner of
15% or more of the outstanding shares of Common Stock solely as a result of the execution of
(and/or consummation of the

-3-

 

purchase of the 1,807,021 shares of Common Stock in accordance with) a Letter Agreement, dated
as of June 20, 2007, among Brencourt, Thomas W. Smith and Scott J. Vassalluzzo, as entered into on
June 20, 2007 (excluding any amendment thereto, if any), until such time thereafter as Brencourt
shall become the Beneficial Owner (other than by means of a stock dividend or stock split) of any
additional shares of Common Stock. Notwithstanding anything in this Agreement to the contrary,
neither Velo Holdings Inc., Velo Acquisition Inc., One Equity Partners II, L.P., Oak Investment
Partners XII, L.P., Rho Ventures V, L.P., Rho Ventures V, Affiliates, L.L.C. nor any of their
Affiliates or Associates shall be deemed to be an Acquiring Person as a result, directly or
indirectly, of (I) the approval, execution, delivery or performance of the Merger Agreement and the
Related Documents, (II) the consummation of transactions contemplated under the Merger Agreement
and the Related Documents, or (III) any other acquisition of Beneficial Ownership of shares of
Common Stock made while the Merger Agreement is in full force and effect, until such time
hereafter, after the termination of the Merger Agreement, as such Person shall become the
Beneficial Owner (other than by means of a stock dividend or stock split) of any additional shares
of Common Stock while such Person is or as a result of which such Person becomes the Beneficial
Owner of 15% or more of the outstanding shares of Common Stock.

     “Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in Rule
12b-2 under the Exchange Act, as such Rule is in effect on the date of this Agreement.

     “Agreement” shall have the meaning set forth in the Preamble.

-4-

 

          A Person shall be deemed the “Beneficial Owner” of, to have “Beneficial Ownership” of, and to
“Beneficially Own”, any securities:

     (a) as to which such Person or any of such Person’s Affiliates or Associates is or may
be deemed to be, directly or indirectly, the beneficial owner of pursuant to Rule 13d-3
under the Exchange Act, as such Rules are in effect on the date of this Agreement;

     (b) as to which such Person or any of such Person’s Affiliates or Associates has the
right to acquire (whether such right is exercisable immediately or only after the passage
of time or the occurrence of conditions) pursuant to any agreement, arrangement or
understanding (other than customary agreements with and between underwriters and selling
group members with respect to a bona fide public offering of securities), written or
otherwise, or upon the exercise of conversion rights, exchange rights, rights (other than
the Rights), warrants or options, or otherwise; or

     (c) which are Beneficially Owned, directly or indirectly, by any other Person (or any
Affiliate or Associate thereof) and with respect to which such Person or any of such
Person’s Affiliates or Associates has any agreement, arrangement or understanding (other
than customary agreements with and between underwriters and selling group members with
respect to a bona fide public offering of securities), whether or not in writing, for the
purpose of acquiring, holding, voting (except pursuant to a revocable proxy or consent as
described in the proviso set forth in (ii) below) or disposing of any securities of the
Company;

-5-

 

provided, however, that a Person shall not be deemed the “Beneficial Owner” of, to
have “Beneficial Ownership” of, or to “Beneficially Own”, any security (i) solely because such
security has been tendered pursuant to a tender or exchange offer made by or on behalf of such
Person or any of such Person’s Affiliates or Associates until such tendered security is accepted
for payment or exchange or (ii) solely because such Person or any of such Person’s Affiliates or
Associates has or shares the power to vote or direct the voting of such security pursuant to a
revocable proxy or consent given in response to a public proxy or consent solicitation made to more
than ten holders of shares of a class of capital stock of the Company registered under Section 12
of the Exchange Act and pursuant to, and in accordance with, the applicable rules and regulations
under the Exchange Act, except if such power (or the arrangements relating thereto) is then
reportable under Item 6 of Schedule 13D under the Exchange Act (or any similar provision of a
comparable or successor report). Notwithstanding the foregoing, no officer or director of the
Company shall be deemed to Beneficially Own any securities of any other Person solely by virtue of
any actions that such officer or director takes in such capacity. For purposes of this Agreement,
in determining the percentage of the outstanding shares of Common Stock with respect to which a
Person is the Beneficial Owner, all shares as to which such Person is deemed the Beneficial Owner
shall be deemed outstanding.

     “Brencourt” has the meaning set forth in the definition of Acquiring Person.

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

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     “Close of Business” on any given date shall mean 5:00 p.m. New York City time on such date or,
if such date is not a Business Day, 5:00 p.m. New York City time on the next succeeding Business
Day.

     “Common Stock” shall mean the shares of Common Stock, par value $0.01 per share, of the
Company.

     “Company” shall have the meaning set forth in the Preamble.

     “Election to Exercise” shall have the meaning set forth in Section 2.3(d).

     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

     “Exchange Ratio” shall have the meaning set forth in Section 3.1(c).

     “Exchange Time” shall mean the time at which the right to exercise the Rights shall terminate
pursuant to Section 3.1(c).

     “Exercise Price” shall mean, as of any date, the price at which a holder may purchase the
securities issuable upon exercise of one whole Right. Until adjustment thereof in accordance with
the terms hereof, the Exercise Price shall equal $240.00.

     “Expansion Factor” shall have the meaning set forth in Section 2.4(a).

     “Expiration Time” shall mean the earliest of (a) the Exchange Time, (b) the Redemption Time,
(c) the Close of Business on the second anniversary of the date of this Agreement, unless, for
purposes of this clause (c), extended by action of the Board of Directors (in which case the
applicable time shall be the time at which it has been so extended), (d) immediately prior to the
effective time of a consolidation, merger or statutory share exchange that does not constitute a
Flip-over Transaction or Event and (e) immediately prior to the “Effective Time” as defined in the
Merger Agreement.

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     “Flip-in Date” shall mean the tenth Business Day after any Stock Acquisition Date or such
earlier or later date and time as the Board of Directors of the Company may from time to time fix
by resolution adopted prior to the Flip-in Date that would otherwise have occurred.

     “Flip-over Entity”, for purposes of Section 3.2, shall mean (a) in the case of a Flip-over
Transaction or Event described in clause (a) of the definition thereof, the Person issuing any
securities into which shares of Common Stock are being converted or exchanged and, if no such
securities are being issued, the other Person that is a party to such Flip-over Transaction or
Event and (b) in the case of a Flip-over Transaction or Event referenced in clause (b) of the
definition thereof, the Person receiving the greatest portion of the (i) assets or, or if (i) is
not readily determinable, (ii) operating income or cash flow being transferred in such Flip-over
Transaction or Event, provided in all cases if such Person is a Subsidiary of another Person, the
ultimate parent entity of such Person shall be the Flip-over Entity.

     “Flip-over Stock” shall mean the capital stock (or similar equity interest) with the greatest
voting power in respect of the election of directors (or other persons similarly responsible for
the direction of the business and affairs) of the Flip-over Entity.

     “Flip-over Transaction or Event” shall mean a transaction or series of transactions, on or
after a Flip-in Date, in which, directly or indirectly, (a) the Company shall consolidate or merge
or participate in a statutory share exchange with any other Person if, at the time of consummation
of the consolidation, merger or statutory share exchange or at the time the Company enters into any
agreement with respect to any such consolidation, merger or statutory share exchange, the Acquiring
Person is the Beneficial

-8-

 

Owner of 90% or more of the outstanding shares of Common Stock or controls the Board of
Directors of the Company and either (i) any term of or arrangement concerning the treatment of
shares of capital stock in such consolidation, merger or statutory share exchange relating to the
Acquiring Person is not identical to the terms and arrangements relating to other holders of the
Common Stock or (ii) the Person with whom the transaction or series of transactions occurs is the
Acquiring Person or an Affiliate or Associate of the Acquiring Person or (b) the Company shall sell
or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer) assets
(i) aggregating more than 50% of the assets (measured by either book value or fair market value) or
(ii) generating more than 50% of the operating income or cash flow, of the Company and its
Subsidiaries (taken as a whole) to any Person (other than the Company or one or more of its wholly
owned Subsidiaries) or to two or more such Persons that are Affiliates or Associates or otherwise
acting in concert, if, at the time of the entry by the Company (or any such Subsidiary) into an
agreement with respect to such sale or transfer of assets, the Acquiring Person or any of its
Affiliates or Associates controls the Board of Directors of the Company or the Acquiring Person is
the Beneficial Owner of 90% or more of the outstanding shares of Common Stock. For purposes of the
foregoing description, the term “Acquiring Person” shall include any Acquiring Person and its
Affiliates and Associates, counted together as a single Person. An Acquiring Person shall be
deemed to control the Company’s Board of Directors when, on or following a Stock Acquisition Date,
the persons who were directors of the Company (or persons nominated and/or appointed as directors
by vote of a majority of such persons) before the Stock Acquisition Date shall cease to constitute
a majority of the Company’s Board of Directors.

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     “Market Price” per share of any securities on any date shall mean the average of the daily
closing prices per share of such securities (determined as described below) on each of the 20
consecutive Trading Days through and including the Trading Day immediately preceding such date;
provided, however, that if any event described in Section 2.4, or any analogous
event, shall have caused the closing prices used to determine the Market Price on any Trading Days
during such period of 20 Trading Days not to be fully comparable with the closing price on such
date, each such closing price so used shall be appropriately adjusted in order to make it fully
comparable with the closing price on such date. The closing price per share of any securities on
any date shall be the last reported sale price, regular way, or, in case no such sale takes place
or is quoted on such date, the average of the closing bid and asked prices, regular way, for each
share of such securities, in either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to trading on the New York Stock
Exchange, Inc. (“NYSE”) or, if the securities are not listed or admitted to trading on the NYSE, as
reported in the principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the securities are listed or admitted
to trading or, if the securities are not listed or admitted to trading on any national securities
exchange, as reported by NASDAQ or such other system then in use, or, if on any such date the
securities are not listed or admitted to trading on any national securities exchange or 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 securities selected by the Board of Directors of
the Company; provided, however, that if on any such date the securities are not
listed or admitted to

-10-

 

trading on a national securities exchange or traded in the over-the-counter market, the
closing price per share of such securities on such date shall mean the fair value per share of such
securities on such date as determined in good faith by the Board of Directors of the Company, after
consultation with a nationally recognized investment banking firm, and set forth in a certificate
delivered to the Rights Agent.

     “Merger Agreement” shall mean an Agreement and Plan of Merger by and among Vertrue
Incorporated, Velo Holdings Inc. and Velo Acquisition Inc., dated March 22, 2007, as it may be
amended from time to time.

     “NASDAQ” shall have the meaning set forth in the Recitals.

     “NYSE” shall have the meaning set forth in the definition of Market Price.

     “Option Holder” shall have the meaning set forth in the definition of Acquiring Person.

     “Payment Time” shall have the meaning set forth in the Recitals.

     “Person” shall mean any individual, firm, partnership, limited liability company, association,
group (as such term is used in Rule 13d-5 under the Exchange Act, as such Rule is in effect on the
date of this Agreement), corporation or other entity, including any successor (by merger or
otherwise) thereof.

     “Preferred Stock” shall mean the series of Participating Preferred Stock, no par value, of the
Company created by a Certificate of Designation and Terms in substantially the form set forth in
Exhibit B hereto appropriately completed.

     “Record Time” shall have the meaning set forth in the Recitals.

     “Redemption Price” shall mean an amount equal to one-tenth of one cent, $0.001.

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     “Redemption Time” shall mean the time at which the right to exercise the Rights shall
terminate pursuant to Section 5.1.

     “Related Documents” shall mean any other transactional agreements relating to the Merger
Agreement, including without limitation the Rollover and Voting Commitment Letter Agreement between
Gary A. Johnson and Velo Holdings Inc.

     “Right” shall have the meaning set forth in the Recitals.

     “Rights Agent” shall have the meaning set forth in the Preamble.

     “Rights Certificate” shall have the meaning set forth in Section 2.3(c).

     “Rights Register” shall have the meaning set forth in Section 2.7(a).

     “Separation Time” shall mean the earlier of (a) the Close of Business on the tenth Business
Day (or such earlier or later date as the Board of Directors of the Company may from time to time
fix by resolution adopted prior to the Separation Time that otherwise would have occurred) after
the date on which any Person commences or publicly announces the intention to commence a tender or
exchange offer that, if consummated, would result in such Person’s becoming an Acquiring Person and
(b) the time of the first event causing a Flip-in Date to occur; provided that if the
foregoing results in the Separation Time being prior to the Record Time, the Separation Time shall
be the Record Time, and provided, further, that if any tender or exchange offer or
public announcement of an intention to commence such an offer referenced in clause (a) of this
paragraph is cancelled, terminated or otherwise withdrawn prior to the Separation Time without the
purchase of any shares of Common Stock pursuant thereto, such offer shall be deemed, for purposes
of this paragraph, never to have been made.

-12-

 

     “Stock Acquisition Date” shall mean the earlier of (a) the first date on which there shall be
a public announcement by the Company (by any means) that a Person has become an Acquiring Person or
(b) the date and time on which any Acquiring Person becomes the Beneficial Owner of more than 25%
of the outstanding shares of Common Stock.

     “Subsidiary” of any specified Person shall mean any corporation or other entity of which a
majority of the voting power of the equity securities or a majority of the equity or membership
interest is Beneficially Owned, directly or indirectly, by such Person.

     “Trading Day”, when used with respect to any securities, shall mean a day on which the NYSE is
open for the transaction of business or, if such securities are not listed or admitted to trading
on the NYSE, a day on which the principal national securities exchange on which such securities are
listed or admitted to trading is open for the transaction of business or, if such securities are
not listed or admitted to trading on any national securities exchange, a Business Day.

ARTICLE II

THE RIGHTS

     2.1 Summary of Rights. As soon as practicable after the Record Time, the Company will
mail a letter summarizing the terms of the Rights to each holder of record of Common Stock as of
the Record Time, at such holder’s address as shown by the records of the Company.

     2.2 Legend on Common Stock Certificates. Certificates for the Common Stock issued on
or after the Record Time but prior to the Separation Time shall

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evidence one Right for each share of Common Stock represented thereby and shall have impressed
on, printed on, written on or otherwise affixed to them the following legend:

Until the Separation Time (as defined in the Rights Agreement referred to below), this
certificate also evidences and entitles the holder hereof to certain Rights (as defined in
the Rights Agreement) as set forth in a Rights Agreement, dated as of July 3, 2007 (as such
may be amended from time to time, the “Rights Agreement”), between Vertrue Incorporated
(the “Company”) and American Stock Transfer & Trust Company, as Rights Agent, the terms of
which are hereby incorporated herein by reference and a copy of which is on file at the
principal executive offices of the Company. Under certain circumstances, as set forth in
the Rights Agreement, such Rights may be redeemed, may become exercisable for securities or
assets of the Company or securities of another entity, may be exchanged for shares of
Common Stock or other securities or assets of the Company, may expire, may become void (if
they are “Beneficially Owned” by an “Acquiring Person” or an Affiliate or Associate
thereof, as such terms are defined in the Rights Agreement, or by any transferee of any of
the foregoing) or may be evidenced by separate certificates and may no longer be evidenced
by this certificate. The Company will mail or arrange for the mailing of a copy of the
Rights Agreement to the holder of this certificate without charge after the receipt of a
written request therefor.

Certificates representing shares of Common Stock that are issued and outstanding at the Record Time
shall, together with the letter mailed pursuant to Section 2.1, evidence one Right for each share
of Common Stock evidenced thereby notwithstanding the absence of the foregoing legend.

          If the Common Stock issued after the Record Time but prior to the Separation Time shall be
uncertificated, the registration of such Common Stock on the stock transfer books of the Company
shall evidence one Right for each share of Common Stock represented thereby and the Company shall
mail to every Person that holds such Common Stock a confirmation of the registration of such Common
Stock on the stock transfer books of the Company, which confirmation will have impressed, printed,
written or stamped thereon or otherwise affixed thereto the above legend. The Company shall

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mail or arrange for the mailing of a copy of this Agreement to any Person that holds Common
Stock, as evidenced by the registration of the Common Stock in the name of such Person on the stock
transfer books of the Company, without charge after the receipt of a written request therefor.

     2.3 Exercise of Rights; Separation of Rights. (a) Subject to Sections 3.1, 5.1 and
5.10 and subject to adjustment as herein set forth, each Right will entitle the holder thereof, at
or after the Separation Time and prior to the Expiration Time, to purchase, for the Exercise Price,
one one-hundredth of a share of Preferred Stock.

     (b) Until the Separation Time, (i) no Right may be exercised and (ii) each Right will be
evidenced by the certificate for the associated share of Common Stock (or, if the Common Stock
shall be uncertificated, by the registration of the associated Common Stock on the stock transfer
books of the Company and the confirmation thereof provided for in Section 2.2), together, in the
case of certificates issued prior to the Record Time, with the letter mailed to the record holder
thereof pursuant to Section 2.1, and will be transferable only together with, and will be
transferred by a transfer (whether with or without such letter or confirmation) of, such associated
share.

     (c) Subject to the terms and conditions hereof, at or after the Separation Time and prior to
the Expiration Time, the Rights (i) may be exercised and (ii) may be transferred independent of
shares of Common Stock. Promptly following the Separation Time, the Rights Agent will mail to each
holder of record of Common Stock as of the Separation Time (other than any Person whose Rights have
become void pursuant to Section 3.1(b)), at such holder’s address as shown by the records of the

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Company (the Company hereby agreeing to furnish copies of such records to the Rights Agent for
this purpose), (x) a certificate (a “Rights Certificate”) in substantially the form of Exhibit A
hereto appropriately completed, representing the number of Rights held by such holder at the
Separation Time and having such marks of identification or designation and such legends, summaries
or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any law or with any
rule or regulation made pursuant thereto or with any rule or regulation of any national securities
exchange or quotation system on which the Rights may from time to time be listed or traded, or to
conform to usage, and (y) a disclosure statement describing the Rights.

     (d) Subject to the terms and conditions hereof, Rights may be exercised on any Business Day on
or after the Separation Time and prior to the Expiration Time by submitting to the Rights Agent the
Rights Certificate evidencing such Rights with an election to exercise (an “Election to Exercise”)
substantially in the form attached to the Rights Certificate duly completed, accompanied by payment
in cash, or by certified or official bank check or money order payable to the order of the Company,
of a sum equal to the Exercise Price multiplied by the number of Rights being exercised and a sum
sufficient to cover any transfer tax or charge that may be payable in respect of any transfer
involved in the transfer or delivery of Rights Certificates or the issuance or delivery of
certificates (or, if uncertificated, the registration on the stock transfer books of the Company)
for shares or depositary receipts (or both) in a name other than that of the holder of the Rights
being exercised.

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     (e) Upon receipt of a Rights Certificate, with an Election to Exercise accompanied by payment
as set forth in Section 2.3(d), and subject to the terms and conditions hereof, the Rights Agent
will thereupon promptly (i)(A) requisition from a transfer agent stock certificates evidencing such
number of shares or other securities to be purchased or, in the case of uncertificated shares or
other securities, requisition from a transfer agent a notice setting forth such number of shares or
other securities to be purchased for which registration will be made on the stock transfer books of
the Company (the Company hereby irrevocably authorizing its transfer agents to comply with all such
requisitions), and (B) if the Company elects pursuant to Section 5.5 not to issue certificates (or
effect registrations on the stock transfer books of the Company) representing fractional shares,
requisition from the depositary selected by the Company depositary receipts representing the
fractional shares to be purchased or requisition from the Company the amount of cash to be paid in
lieu of fractional shares in accordance with Section 5.5 and (ii) after receipt of such
certificates, depositary receipts, notices and/or cash, deliver the same to or upon the order of
the registered holder of such Rights Certificate, registered (in the case of certificates,
depositary receipts or notices) in such name or names as may be designated by such holder.

     (f) In case the holder of any Rights shall exercise less than all of the Rights evidenced by
such holder’s Rights Certificate, a new Rights Certificate evidencing the Rights remaining
unexercised will be issued by the Rights Agent to such holder or to such holder’s duly authorized
assigns.

     (g) The Company covenants and agrees that it will (i) take all such action as may be necessary
to ensure that all shares delivered (or evidenced by

-17-

 

registration on the stock transfer books of the Company) upon exercise of Rights shall, at the
time of delivery of the certificates (or registration) for such shares (subject to payment of the
Exercise Price), be duly and validly authorized, executed, issued and delivered (or registered) and
fully paid and nonassessable; (ii) take all such action as may be necessary to comply with any
applicable requirements of the Securities Act of 1933, as amended, or the Exchange Act, and the
rules and regulations thereunder, and any other applicable law, rule or regulation, in connection
with the issuance of any shares upon exercise of Rights; and (iii) pay when due and payable any and
all federal and state transfer taxes and charges that may be payable in respect of the original
issuance or delivery of the Rights Certificates or of any shares issued upon the exercise of
Rights, provided that the Company shall not be required to pay any transfer tax or charge
that may be payable in respect of any transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates (or the registration) for shares in a name
other than that of the holder of the Rights being transferred or exercised.

     2.4 Adjustments to Exercise Price; Number of Rights. (a) In the event the Company
shall at any time after the Record Time and prior to the Separation Time (i) declare or pay a
dividend on Common Stock payable in Common Stock, (ii) subdivide the outstanding Common Stock or
(iii) combine the outstanding Common Stock into a smaller number of shares of Common Stock, (x) the
Exercise Price in effect after such adjustment will be equal to the Exercise Price in effect
immediately prior to such adjustment divided by the number of shares of Common Stock including any
fractional shares in lieu of which such holder received cash (the “Expansion Factor”) that a holder
of one share of Common Stock immediately prior to such dividend, subdivision or

-18-

 

combination would hold thereafter as a result thereof and (y) each Right held prior to such
adjustment will become that number of Rights equal to the Expansion Factor, and the adjusted number
of Rights will be deemed to be distributed among the shares of Common Stock with respect to which
the original Rights were associated (if they remain outstanding) and the shares issued in respect
of such dividend, subdivision or combination, so that each such share of Common Stock will have
exactly one Right associated with it. Each adjustment made pursuant to this paragraph shall be
made as of the payment or effective date for the applicable dividend, subdivision or combination.

     In the event that the Company shall at any time after the Record Time and prior to the
Separation Time issue any shares of Common Stock otherwise than in a transaction referenced in the
preceding paragraph, each such share of Common Stock so issued shall automatically have one new
Right associated with it, which Right shall be evidenced by the certificate representing such share
(or, if the Common Stock shall be uncertificated, such Right shall be evidenced by the registration
of such Common Stock on the stock transfer books of the Company and the confirmation thereof
provided for in Section 2.2). Rights shall be issued by the Company in respect of shares of Common
Stock that are issued or sold by the Company after the Separation Time only to the extent provided
in Section 5.3.

     (b) In the event that the Company shall at any time after the Record Time and prior to the
Separation Time issue or distribute any securities or assets in respect of, in lieu of or in
exchange for Common Stock (other than pursuant to any non-extraordinary periodic cash dividend or a
dividend paid solely in Common Stock), whether by dividend, in a reclassification or
recapitalization (including any such

-19-

 

transaction involving a merger, consolidation or statutory share exchange), or otherwise, the
Company shall make such adjustments, if any, in the Exercise Price, number of Rights and/or
securities or other property purchasable upon exercise of Rights as the Board of Directors of the
Company, in its sole discretion, may deem to be appropriate under the circumstances in order to
adequately protect the interests of the holders of Rights generally, and the Company and the Rights
Agent shall amend this Agreement as necessary to provide for such adjustments.

     (c) Each adjustment to the Exercise Price made pursuant to this Section 2.4 shall be
calculated to the nearest cent. Whenever an adjustment to the Exercise Price is made pursuant to
this Section 2.4, the Company shall (i) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment and (ii) promptly file
with the Rights Agent and with each transfer agent for the Common Stock a copy of such certificate;
provided that an adjustment shall be deemed to have been made regardless of whether the
Company has compiled with this sentence with respect to such adjustment.

     (d) Rights Certificates shall represent the right to purchase the securities purchasable under
the terms of this Agreement, including any adjustment or change in the securities purchasable upon
exercise of the Rights, even though such certificates may continue to express the securities
purchasable at the time of issuance of the initial Rights Certificates.

     2.5 Date on Which Exercise is Effective. Each Person in whose name any certificate
for shares is issued (or registration on the stock transfer books is effected) upon the exercise of
Rights shall for all purposes be deemed to have become the holder of

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record of the shares represented thereby on the date upon which the Rights Certificate
evidencing such Rights was duly surrendered and payment of the Exercise Price for such Rights (and
any applicable taxes and other governmental charges payable by the exercising holder hereunder) was
made; provided, however, that if the date of such surrender and payment is a date
upon which the stock 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 (or registration) shall be dated,
the next succeeding Business Day on which the stock transfer books of the Company are open.

     2.6 Execution, Authentication, Delivery and Dating of Rights Certificates. (a) The
Rights Certificates shall be executed on behalf of the Company by its Chairman of the Board,
President or one of its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the
Rights Certificates may be manual or facsimile.

     Rights Certificates bearing the manual or facsimile signatures of individuals who were at any
time the proper officers of the Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the countersignature and
delivery of such Rights Certificates.

     Promptly after the Separation Time, the Company will notify the Rights Agent of such
Separation Time and will deliver Rights Certificates executed by the Company to the Rights Agent
for countersignature, and, subject to Section 3.1(b), the Rights Agent shall manually countersign
and deliver such Rights Certificates to the holders of the Rights pursuant to Section 2.3(c). No
Rights Certificate shall be valid for any purpose unless manually countersigned by the Rights
Agent.

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     (b) Each Rights Certificate shall be dated the date of countersignature thereof.

     2.7 Registration, Registration of Transfer and Exchange. (a) After the Separation
Time, the Company will cause to be kept a register (the “Rights Register”) in which, subject to
such reasonable regulations as it may prescribe, the Company will provide for the registration and
transfer of Rights. The Rights Agent is hereby appointed “Rights Registrar” for the purpose of
maintaining the Rights Register for the Company and registering Rights and transfers of Rights
after the Separation Time as herein provided. In the event that the Rights Agent shall cease to be
the Rights Registrar, the Rights Agent will have the right to examine the Rights Register at all
reasonable times after the Separation Time.

     After the Separation Time and prior to the Expiration Time, upon surrender for registration of
transfer or exchange of any Rights Certificate, and subject to the provisions of Sections 2.7(c)
and (d), the Company will execute, and the Rights Agent will countersign and deliver, in the name
of the holder or the designated transferee or transferees, as required pursuant to the holder’s
instructions, one or more new Rights Certificates evidencing the same aggregate number of Rights as
did the Rights Certificate so surrendered.

     (b) Except as otherwise provided in Section 3.1(b), all Rights issued upon any registration of
transfer or exchange of Rights Certificates shall be the valid obligations of the Company, and such
Rights shall be entitled to the same benefits under this Agreement as the Rights surrendered upon
such registration of transfer or exchange.

-22-

 

     (c) Every Rights Certificate surrendered for registration of transfer or exchange shall be
duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the
Company or the Rights Agent, as the case may be, duly executed by the holder thereof or such
holder’s attorney duly authorized in writing. As a condition to the issuance of any new Rights
Certificate under this Section 2.7, the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation thereto.

     (d) The Company shall not register the transfer or exchange of any Rights that have become
void under Section 3.1(b), been exchanged under Section 3.1(c) or been redeemed under Section 5.1.

     2.8 Mutilated, Destroyed, Lost and Stolen Rights Certificates. (a) If any mutilated
Rights Certificate is surrendered to the Rights Agent prior to the Expiration Time, then, subject
to Sections 3.1(b), 3.1(c) and 5.1, the Company shall execute and the Rights Agent shall
countersign and deliver in exchange therefor a new Rights Certificate evidencing the same number of
Rights as did the Rights Certificate so surrendered.

     (b) If there shall be delivered to the Company and the Rights Agent prior to the Expiration
Time (i) evidence to their satisfaction of the destruction, loss or theft of any Rights Certificate
and (ii) such security or indemnity as may be required by them to save each of them and any of
their agents harmless, then, subject to Sections 3.1(b), 3.1(c) and 5.1 and in the absence of
notice to the Company or the Rights Agent that such Rights Certificate has been acquired by a
bona fide purchaser, the Company shall execute and upon its request the Rights
Agent shall countersign and deliver, in lieu of any such destroyed, lost or stolen Rights
Certificate, a new Rights Certificate

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evidencing the same number of Rights as did the Rights Certificate so destroyed, lost or
stolen.

     (c) As a condition to the issuance of any new Rights Certificate under this Section 2.8, the
Company may require the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses (including the fees and expenses of
the Rights Agent) connected therewith.

     (d) Every new Rights Certificate issued pursuant to this Section 2.8 in lieu of any destroyed,
lost or stolen Rights Certificate shall evidence an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Rights Certificate shall be at any time
enforceable by anyone, and, subject to Section 3.1(b) shall be entitled to all the benefits of this
Agreement equally and proportionately with any and all other Rights duly issued hereunder.

     2.9 Persons Deemed Owners. Prior to due presentment of a Rights Certificate (or,
prior to the Separation Time, the associated Common Stock certificate or notice of transfer, if
uncertificated) for registration of transfer, the Company, the Rights Agent and any agent of the
Company or the Rights Agent may deem and treat the Person in whose name such Rights Certificate
(or, prior to the Separation Time, such Common Stock certificate or Common Stock registration, if
uncertificated) is registered as the absolute owner thereof and of the Rights evidenced thereby for
all purposes whatsoever, including the payment of the Redemption Price and neither the Company nor
the Rights Agent shall be affected by any notice to the contrary. As used in this Agreement,
unless the context otherwise requires, the term “holder” of any Rights shall mean the registered

-24-

 

holder of such Rights (or, prior to the Separation Time, the associated shares of Common
Stock).

     2.10 Delivery and Cancellation of Certificates. All Rights Certificates surrendered
upon exercise or for registration of transfer or exchange shall, if surrendered to any Person other
than the Rights Agent, be delivered to the Rights Agent and, in any case, shall be promptly
cancelled by the Rights Agent. The Company may at any time deliver to the Rights Agent for
cancellation any Rights Certificates previously countersigned and delivered hereunder that the
Company may have acquired in any manner whatsoever, and all Rights Certificates so delivered shall
be promptly cancelled by the Rights Agent. No Rights Certificates shall be countersigned in lieu
of or in exchange for any Rights Certificates cancelled as provided in this Section 2.10, except as
expressly permitted by this Agreement. The Rights Agent shall destroy all cancelled Rights
Certificates and deliver a certificate of destruction to the Company.

     2.11 Agreement of Rights Holders. Every holder of Rights by accepting the same
consents and agrees with the Company and the Rights Agent and with every other holder of Rights
that:

     (a) prior to the Separation Time, each Right will be transferable only together with, and will
be transferred by a transfer of, the associated share of Common Stock;

     (b) after the Separation Time, the Rights Certificates will be transferable only on the Rights
Register as provided herein;

     (c) prior to due presentment of a Rights Certificate (or, prior to the Separation Time, the
associated Common Stock certificate or Common Stock

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registration, if uncertificated) for registration of transfer, the Company,
the Rights Agent and any agent of the Company or the Rights Agent may deem
and treat the Person in whose name the Rights Certificate (or, prior to the
Separation Time, the associated Common Stock certificate or Common Stock
registration, if uncertificated) is registered as the absolute owner
thereof and of the Rights evidenced thereby for all purposes whatsoever,
and neither the Company nor the Rights Agent shall be affected by any notice to the contrary;

     (d) Rights Beneficially Owned by certain Persons will, under the circumstances set forth in
Section 3.1(b), become void; and

     (e) this Agreement may be supplemented or amended from time to time pursuant to Section 2.4(b)
or 5.4.

ARTICLE III

ADJUSTMENTS TO THE RIGHTS IN

THE EVENT OF CERTAIN TRANSACTIONS

     3.1 Flip-in. (a) In the event that prior to the Expiration Time a Flip-in Date shall
occur, except as provided in this Section 3.1, each Right shall constitute the right to purchase
from the Company, upon exercise thereof in accordance with the terms hereof (but subject to Section
5.10), that number of shares of Common Stock having an aggregate Market Price on the Stock
Acquisition Date that gave rise to the Flip-in Date equal to twice the Exercise Price for an amount
in cash equal to the Exercise Price (such right to be appropriately adjusted in order to protect
the interests of the holders of Rights generally in the event that on or after such Stock
Acquisition Date any of the events

-26-

 

described in Section 2.4(a) or (b), or any analogous event, shall have occurred with respect
to the Common Stock).

     (b) Notwithstanding the foregoing, any Rights that are or were Beneficially Owned on or after
the Stock Acquisition Date by an Acquiring Person or an Affiliate or Associate thereof or by any
transferee, direct or indirect, of any of the foregoing shall become void and any holder of such
Rights (including transferees) shall thereafter have no right to exercise or transfer such Rights
under any provision of this Agreement. No Rights Certificate shall be issued that represents
Rights beneficially owned by an Acquiring Person; no Rights Certificate shall be issued that
represents Rights to be transferred to an Acquiring Person; and any Rights Certificate delivered to
the Rights Agent for transfer to an Acquiring Person shall be cancelled. For the purpose of the
preceding sentence, the term “Acquiring Person” shall include any Acquiring Person, its Affiliates
and Associates or any transferees. If any Rights Certificate is presented for assignment or
exercise and the Person presenting the same will not complete the certification set forth at the
end of the form of assignment or notice of election to exercise and provide such additional
evidence of the identity of the Beneficial Owner and its Affiliates and Associates (or former
Beneficial Owners and their Affiliates and Associates) as the Company shall reasonably request,
then the Company shall be entitled conclusively to deem the Beneficial Owner thereof to be an
Acquiring Person or an Affiliate or Associate thereof or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced thereby to be void and not transferable or exercisable.

     (c) The Board of Directors of the Company may, at its option, at any time after a Flip-in Date
and prior to the time that an Acquiring Person becomes the

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Beneficial Owner of more than 50% of the outstanding shares of Common Stock, elect to exchange
all (but not less than all) of the then outstanding Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 3.1(b)) for shares of Common Stock at an
exchange ratio of one share of Common Stock per Right, appropriately adjusted in order to protect
the interests of holders of Rights generally in the event that after the Separation Time any of the
events described in Section 2.4(a) or (b), or any analogous event, shall have occurred with respect
to the Common Stock (such exchange ratio, as adjusted from time to time, being hereinafter referred
to as the “Exchange Ratio”).

     Immediately upon the action of the Board of Directors of the Company electing to exchange the
Rights, without any further action and without any notice, the right to exercise the Rights will
terminate and each Right (other than Rights that have become void pursuant to Section 3.1(b)),
whether or not previously exercised, will thereafter represent only the right to receive a number
of shares of Common Stock calculated in accordance with the Exchange Ratio. Promptly after the
action of the Board of Directors electing to exchange the Rights, the Company shall give notice
thereof (specifying the steps to be taken to receive shares of Common Stock in exchange for Rights)
to the Rights Agent and the holders of the Rights (other than Rights that have become void pursuant
to Section 3.1(b)) outstanding immediately prior thereto by mailing such notice in accordance with
Section 5.9; provided, however, that the failure to give, or any defect in, such
notice shall not affect the validity of an exchange.

     Each Person in whose name any certificate for shares is issued (or for whom any registration
on the stock transfer books of the Company is made) upon the

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exchange of Rights pursuant to this Section 3.1(c) or Section 3.1(d) shall for all purposes
be deemed to have become the holder of record of the shares represented thereby on, and such
certificate (or registration on the stock transfer books of the Company) shall be dated (or
registered as of), the date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of any applicable taxes and other governmental charges payable by the
holder was made; provided, however, that if the date of such surrender and payment
is a date upon which the stock 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 (or registration on
the stock transfer books of the Company) shall be dated (or registered as of), the next succeeding
Business Day on which the stock transfer books of the Company are open.

     (d) Whenever the Company shall become obligated under Section 3.1(a) or (c) to issue shares of
Common Stock upon exercise of or in exchange for Rights, the Company, at its option, may substitute
therefor shares of Preferred Stock, at a ratio of one one-hundredth of a share of Preferred Stock
for each share of Common Stock so issuable.

     (e) In the event that there shall not be sufficient treasury shares or authorized but unissued
shares of Common Stock or Preferred Stock of the Company to permit the exercise or exchange in full
of the Rights in accordance with Section 3.1(a) or if the Company so elects to make the exchange
referenced in Section 3.1(c), the Company shall either (i) call a meeting of stockholders seeking
approval to cause sufficient additional shares to be authorized (provided that if such approval is
not obtained the Company will take the action specified in clause (ii) of this sentence) or (ii)

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take such action as shall be necessary to ensure and provide, as and when and to the maximum
extent permitted by applicable law and any agreements or instruments in effect on the Stock
Acquisition Date (and remaining in effect) to which it is a party, that each Right shall thereafter
constitute the right to receive, (x) at the Company’s option, either (A) in return for the Exercise
Price, debt or equity securities or other assets or cash (or a combination thereof) having a fair
value equal to twice the Exercise Price, or (B) without payment of consideration (except as
otherwise required by applicable law), debt or equity securities or other assets or cash (or a
combination thereof) having a fair value equal to the Exercise Price, or (y) if the Board of
Directors of the Company elects to exchange the Rights in accordance with Section 3.1(c), debt or
equity securities or other assets or cash (or a combination thereof) having a fair value equal to
the product of the Market Price of a share of Common Stock on the Flip-in Date times the Exchange
Ratio in effect on the Flip-in Date, where in any case set forth in (x) or (y) above the fair value
of such debt or equity securities or other assets or cash (or a combination thereof) shall be as
determined in good faith by the Board of Directors of the Company, after consultation with a
nationally recognized investment banking firm.

     3.2 Flip-over. (a) Prior to the Expiration Time, the Company shall not enter into any
agreement with respect to, consummate or permit to occur any Flip-over Transaction or Event unless
and until it shall have entered into a supplemental agreement with the Flip-over Entity, for the
benefit of the holders of the Rights (the terms of which shall be reflected in an amendment to this
Agreement entered into with the Rights Agent), providing that, upon consummation or occurrence of
the Flip-over Transaction or Event (i) each Right shall thereafter constitute the right to purchase
from the Flip-over

-30-

 

Entity, upon exercise thereof in accordance with the terms hereof, that number of shares of
Flip-over Stock of the Flip-over Entity having an aggregate Market Price on the date of
consummation or occurrence of such Flip-over Transaction or Event equal to twice the Exercise Price
for an amount in cash equal to the Exercise Price (such right to be appropriately adjusted in order
to protect the interests of the holders of Rights generally in the event that after such date of
consummation or occurrence any of the events described in Section 2.4(a) or (b), or any analogous
event, shall have occurred with respect to the Flip-over Stock) and (ii) the Flip-over Entity shall
thereafter be liable for, and shall assume, by virtue of such Flip-over Transaction or Event and
such supplemental agreement, all the obligations and duties of the Company pursuant to this
Agreement.

     (b) Prior to the Expiration Time, unless the Rights will be redeemed pursuant to Section 5.1
pursuant to an agreement entered into by the Company prior to a Flip-in Date, the Company shall not
enter into any agreement with respect to, consummate or permit to occur any Flip-over Transaction
or Event if (i) at the time thereof there are any rights, warrants or securities outstanding or any
other arrangements, agreements or instruments that would eliminate or otherwise diminish in any
material respect the benefits intended to be afforded by this Rights Agreement to the holders of
Rights upon consummation of such transaction, (ii) prior to, simultaneously with or immediately
after such Flip-over Transaction or Event, the stockholders of the Person who constitutes, or would
constitute, the Flip-over Entity shall have received a distribution of Rights previously owned by
such Person or any of its Affiliates or Associates, or (iii) the form or nature of organization of
the Flip-over Entity would preclude or limit the exercisability of the Rights.

-31-

 

     (c) The provisions of this Section 3.2 shall apply to successive Flip-over Transactions or
Events.

ARTICLE IV

THE RIGHTS AGENT

     4.1 General. (a) The Company hereby appoints the Rights Agent to act as agent for the
Company in accordance with the terms and conditions hereof, and the Rights Agent hereby accepts
such appointment. The Company agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the Rights Agent, its
reasonable expenses and counsel fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability, or expense, incurred without negligence, bad faith or willful misconduct on the part of
the Rights Agent, for anything done or omitted to be done by the Rights Agent in connection with
the acceptance and administration of this Agreement, including the costs and expenses of defending
against any claim of liability.

     (b) The Rights Agent shall be protected and shall incur no liability for or in respect of any
action taken, suffered or omitted by it in connection with its administration of this Agreement in
reliance upon any certificate for securities (or registration on the stock transfer books of the
Company) purchasable upon exercise of Rights, Rights Certificate, certificate 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

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and to be signed, executed and, where necessary, verified or acknowledged, by the proper
Person or Persons.

     4.2
Merger or Consolidation or Change of Name of Rights Agent. (a) Any Person into
which the Rights Agent or any successor Rights Agent may be merged or with which it may be
consolidated, or any Person resulting from any merger or consolidation to which the Rights Agent or
any successor Rights Agent is a party, or any Person succeeding to the shareholder services
business of the Rights Agent or any successor Rights Agent, will be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that such Person would be eligible for appointment as a
successor Rights Agent under the provisions of Section 4.4. In case at the time such successor
Rights Agent succeeds to the agency created by this Agreement any of the Rights Certificates have
been countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates have not been countersigned,
any successor Rights Agent may countersign such Rights Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases such
Rights Certificates will have the full force provided in the Rights Certificates and in this
Agreement.

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

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not have been countersigned, the Rights Agent may countersign such Rights Certificates either
in its prior name or in its changed name; and in all such cases such Rights Certificates shall have
the full force provided in the Rights Certificates and in this Agreement.

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

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

     (b) Whenever in the performance of its duties under this Agreement the Rights Agent deems it
necessary or desirable that any fact or matter be proved or established by the Company prior to
taking or 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 a person believed by the Rights Agent to be the Chairman of the Board,
the President or any Vice President and by the Treasurer or any Assistant Treasurer or the
Secretary or any Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate will be full authorization to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance upon such certificate.

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

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

     (e) The Rights Agent will not be under any responsibility in respect of the validity of this
Agreement or the execution and delivery hereof (except the due authorization, execution and
delivery hereof by the Rights Agent) or in respect of the validity or execution of any certificate,
if any, for securities purchasable upon exercise of Rights or Rights Certificate (except its
countersignature thereof); nor will it be responsible for any breach by the Company of any covenant
or condition contained in this Agreement or in any Rights Certificate; nor will it be responsible
for any change in the exercisability of the Rights (including the Rights becoming void pursuant to
Section 3.1(b)) or any adjustment required under the provisions of Section 2.4, 3.1 or 3.2 or
responsible for the manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with respect to the exercise of
Rights after receipt of the certificate contemplated by Section 2.4 describing any such
adjustment); nor will it by any act hereunder be deemed to make any representation or warranty as
to the authorization or reservation of any securities purchasable upon exercise of Rights or any
Rights or as to whether any

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securities purchasable upon exercise of Rights will, when issued, be duly and validly
authorized, executed, issued and delivered and fully paid and nonassessable.

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

     (g) The Rights Agent is hereby authorized and directed to accept instructions with respect to
the performance of its duties hereunder from any person believed by the Rights Agent to be the
Chairman of the Board, the President or any Vice President or the Secretary or any Assistant
Secretary or the Treasurer or any Assistant Treasurer of the Company, and to apply to such persons
for advice or instructions in connection with its duties, and it shall not be liable for any action
taken or suffered by it in good faith in accordance with instructions of any such person.

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

     (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

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attorneys or agents, and the Rights Agent will not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct, provided reasonable care was exercised
in the selection and continued employment thereof.

     4.4 Change of Rights Agent. The Rights Agent may resign and be discharged from its
duties under this Agreement upon 90 days’ notice (or such lesser notice as is acceptable to the
Company) in writing mailed to the Company and to each transfer agent of Common Stock by registered
or certified mail, and to the holders of the Rights in accordance with Section 5.9. The Company
may remove the Rights Agent upon 30 days’ notice in writing, mailed to the Rights Agent and to each
transfer agent of the Common Stock by registered or certified mail, and to the holders of the
Rights in accordance with Section 5.9. If the Rights Agent should resign or be removed or
otherwise become incapable of acting, the Company will appoint a successor to the Rights Agent. If
the Company fails to make such appointment within a period of 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 any Rights (which holder shall, with such notice, submit such
holder’s Rights Certificate for inspection by the Company), then the holder of any Rights 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 Person organized and
doing business under the laws of the United States or any state of the United States, in good
standing, which is authorized under such laws to exercise the powers of the Rights Agent
contemplated by this Agreement and is subject to supervision or examination by

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federal or state authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50,000,000. After appointment, the successor Rights
Agent will 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 will file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Stock,
and mail a notice thereof in writing to the holders of the Rights. Failure to give any notice
provided for in this Section 4.4, 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.

ARTICLE V

MISCELLANEOUS

     5.1 Redemption. (a) The Board of Directors of the Company may, at its option, at any
time prior to the Close of Business on the Flip-in Date, elect to redeem all (but not less than
all) the then outstanding Rights at the Redemption Price and the Company, at its option, may pay
the Redemption Price either in cash or shares of Common Stock or other securities of the Company
deemed by the Board of Directors, in the exercise of its sole discretion, to be at least equivalent
in value to the Redemption Price.

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     (b) Immediately upon the action of the Board of Directors of the Company electing to redeem
the Rights (or, if the resolution of the Board of Directors electing to redeem the Rights states
that the redemption will not be effective until the occurrence of a specified future time or event,
upon the occurrence of such future time or event), without any further action and without any
notice, the right to exercise the Rights will terminate and each Right, whether or not previously
exercised, will thereafter represent only the right to receive the Redemption Price in cash or
securities, as determined by the Board of Directors. Promptly after the Rights are redeemed, the
Company shall give notice of such redemption to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice in accordance with Section 5.9.

     5.2 Expiration. The Rights and this Agreement shall expire at the Expiration Time and
no Person shall have any rights pursuant to this Agreement or any Right after the Expiration Time,
except, if the Rights are exchanged or redeemed, as provided in Section 3.1 or 5.1, respectively.

     5.3 Issuance of New Rights Certificates. Notwithstanding any of the provisions of
this Agreement or of the Rights to the contrary, the Company may, at its option, issue new Rights
Certificates evidencing Rights in such form as may be approved by its Board of Directors to reflect
any adjustment or change in the number or kind or class of shares of capital stock purchasable upon
exercise of Rights made in accordance with the provisions of this Agreement. In addition, in
connection with the issuance or sale of shares of Common Stock by the Company following the
Separation Time and prior to the Expiration Time pursuant to the terms of securities convertible or
redeemable into shares of Common Stock (other than any securities issued or issuable in connection

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with the exercise or exchange of Rights) or to options, in each case issued or granted prior
to, and outstanding at, the Separation Time, the Company shall issue to the holders of such shares
of Common Stock, Rights Certificates representing the appropriate number of Rights in connection
with the issuance or sale of such shares of Common Stock; provided, however, in
each case, (a) no such Rights Certificate shall be issued, if, and to the extent that, the Company
shall be advised by counsel that such issuance would create a significant risk of material adverse
tax consequences to the Company or to the Person to whom such Rights Certificates would be issued,
(b) no such Rights Certificates shall be issued if, and to the extent that, appropriate adjustment
shall have otherwise been made in lieu of the issuance thereof, and (c) the Company shall have no
obligation to distribute Rights Certificates to any Acquiring Person or Affiliate or Associate of
an Acquiring Person or any transferee of any of the foregoing.

     5.4 Supplements and Amendments. The Company and the Rights Agent may from time to
time supplement or amend this Agreement without the approval of any holders of Rights (a) prior to
the Close of Business on the Flip-in Date, in any respect and (b) after the Close of Business on
the Flip-in Date, to make any changes that the Company may deem necessary or desirable and that
shall not materially adversely affect the interests of the holders of Rights generally (other than
the interests of an Acquiring Person or its Affiliates or Associates) or in order to cure any
ambiguity or to correct or supplement any provision contained herein which may be inconsistent with
any other provisions herein or otherwise defective. The Rights Agent will duly execute and deliver
any supplement or amendment hereto requested by the Company which satisfies the terms of the
preceding sentence, provided that any supplement or amendment shall

-40-

 

become effective immediately upon execution by the Company, whether or not also executed by
the Rights Agent.

     5.5 Fractional Shares. If the Company elects not to issue certificates representing
(or register on the stock transfer books of the Company) fractional shares upon exercise,
redemption or exchange of Rights, the Company shall, in lieu thereof, in the sole discretion of the
Board of Directors, either (a) evidence such fractional shares by depositary receipts issued
pursuant to an appropriate agreement between the Company and a depositary selected by it, providing
that each holder of a depositary receipt shall have all of the rights, privileges and preferences
to which such holder would be entitled as a beneficial owner of such fractional share, or (b) pay
to the registered holder of such Rights the appropriate fraction of the Market Price per share in
cash.

     5.6 Rights of Action. Subject to the terms of this Agreement (including Sections
3.1(b) and 5.14), rights of action in respect of this Agreement, other than rights of action vested
solely in the Rights Agent, are vested in the respective holders of the Rights; and any holder of
any Rights, without the consent of the Rights Agent or of the holder of any other Rights, may, on
such holder’s own behalf and for such holder’s own benefit and the benefit of other holders of
Rights, enforce, and may institute and maintain any suit, action or proceeding against the Company
to enforce, or otherwise act in respect of, such holder’s right to exercise such holder’s Rights in
the manner provided in such holder’s Rights Certificate and in this Agreement. Without limiting
the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any breach of this
Agreement and will be entitled to specific performance of the

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obligations under, and injunctive relief against actual or threatened violations of, the
obligations of any Person subject to this Agreement.

     5.7 Holder of Rights Not Deemed a Stockholder. No holder, as such, of any Rights
shall be entitled to vote, receive dividends or be deemed for any purpose the holder of shares or
any other securities that may at any time be issuable on the exercise of such Rights, nor shall
anything contained herein or in any Rights Certificate be construed to confer upon the holder of
any Rights, as such, any of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any meeting thereof, or to
give or withhold consent to any corporate action, or to receive notice of meetings or other actions
affecting stockholders (except as provided in Section 5.8), or to receive dividends or subscription
rights, or otherwise, until such Rights shall have been exercised or exchanged in accordance with
the provisions hereof.

     5.8 Notice of Proposed Actions. In case the Company shall propose at or after the
Separation Time and prior to the Expiration Time (a) to effect or permit a Flip-over Transaction or
Event or (b) to effect the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each holder of a Right, in accordance with Section 5.9, a
notice of such proposed action, which shall specify the date on which such Flip-over Transaction or
Event, liquidation, dissolution, or winding up is to take place, and such notice shall be so given
at least 20 Business Days prior to the date of the taking of such proposed action.

     5.9 Notices. Notices or demands authorized or required by this Agreement to be given
or made by the Rights Agent or by the holder of any Rights to or

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

Vertrue Incorporated

20 Glover Avenue

Norwalk, CT 06850

Attention: General Counsel

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

American Stock Transfer & Trust Company

59 Maiden Lane, Plaza Level

New York, NY 10038

Attention: Office of General Counsel

Notices or demands authorized or required by this Agreement to be given or made by the Company or
the Rights Agent to or on the holder of any Rights shall be sufficiently given or made if delivered
or sent by first-class mail, postage prepaid, addressed to such holder at the address of such
holder as it appears upon the registry books of the Rights Agent or, prior to the Separation Time,
on the registry books of the transfer agent for the Common Stock. Any notice that is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives the notice.

     5.10 Suspension of Exercisability. To the extent that the Company determines in good
faith that some action will or need be taken pursuant to Section 3.1 or to comply with federal or
state securities laws, the Company may suspend the

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exercisability of the Rights for a reasonable period in order to take such action or comply
with such laws. In the event of any such suspension, the Company shall issue as promptly as
practicable a public announcement stating that the exercisability or exchangeability of the Rights
has been temporarily suspended. Notice thereof pursuant to Section 5.9 shall not be required.

     Failure to give a notice pursuant to the provisions of this Agreement shall not affect the
validity of any action taken hereunder.

     5.11 Costs of Enforcement. The Company agrees that if the Company or any other Person
the securities of which are purchasable upon exercise of Rights fails to fulfill any of its
obligations pursuant to this Agreement, then the Company or such Person will reimburse the holder
of any Rights for the costs and expenses (including legal fees) incurred by such holder in actions
to enforce such holder’s rights pursuant to any Rights or this Agreement.

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

     5.13 Benefits of this Agreement. Nothing in this Agreement shall be construed to give
to any Person other than the Company, the Rights Agent and the holders of the Rights any legal or
equitable right, remedy or claim under this Agreement and this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the holders of the Rights.

     5.14 Determination and Actions by the Board of Directors, etc. The Board of
Directors of the Company shall have the exclusive power and authority to

-44-

 

administer this Agreement and to exercise all rights and powers specifically granted to the
Board or to the Company, or as may be necessary or advisable in the administration of this
Agreement, including, without limitation, the right and power to (a) interpret the provisions of
this Agreement and (b) make all determinations deemed necessary or advisable for the administration
of this Agreement. All such actions, interpretations and determinations (including, for purposes
of clause (y) below, all omissions with respect to the foregoing) done or made by the Board, shall
(x) be final, conclusive and binding on the Company, the Rights Agent, the holders of the Rights
and all other parties, and (y) not subject the Board of Directors of the Company to any liability
to the holders of the Rights.

     5.15 Descriptive Headings; Section References. Descriptive headings appear herein for
convenience only and shall not control or affect the meaning or construction of any of the
provisions hereof. Where a reference in this Agreement is made to a Section, such reference shall
be to a Section of this Agreement unless otherwise indicated.

     5.16 GOVERNING LAW. THIS AGREEMENT AND EACH RIGHT ISSUED HEREUNDER SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF DELAWARE AND FOR ALL PURPOSES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS TO BE MADE AND
PERFORMED ENTIRELY WITHIN SUCH STATE.

     5.17 Counterparts. This Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an

-45-

 

original, and all such counterparts shall together constitute but one and the same instrument.

     5.18 Severability. If any term or provision hereof or the application thereof to any
circumstance shall, in any jurisdiction and to any extent, be invalid or unenforceable, such term
or provision shall be ineffective as to such jurisdiction to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the remaining terms and provisions
hereof or the application of such term or provision to circumstances other than those as to which
it is held invalid or unenforceable.

-46-

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of
the date first above written.

	 	 	 	 	 	 	 
	 	 	VERTRUE INCORPORATED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ George W. M. Thomas
 

Name: George W. M. Thomas
	 	 
	 

	 	 	 	Title: Senior Vice President &
General Counsel	 	 
	 
	 	 	 	 	 	 
	 	 	AMERICAN STOCK TRANSFER &

 TRUST COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph F. Wolf	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Joseph F. Wolf	 	 
	 

	 	 	 	Title: Vice President	 	 

-47-

 

EXHIBIT A

FORM OF RIGHTS CERTIFICATE

			
	 	 	 
	Certificate No.                     
	 	                     Rights

THE RIGHTS ARE SUBJECT TO REDEMPTION OR MANDATORY EXCHANGE, AT THE OPTION
OF THE COMPANY, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. RIGHTS
BENEFICIALLY OWNED BY ACQUIRING PERSONS OR AFFILIATES OR ASSOCIATES
THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR TRANSFEREES
OF ANY OF THE FOREGOING WILL BE VOID.

Rights Certificate

Vertrue Incorporated

          This certifies that
                    , or registered assigns, is the registered holder of
the number of Rights set forth above, each of which entitles the registered holder thereof, subject
to the terms, provisions and conditions of the Stockholder Protection Rights Agreement, dated as of
July 3, 2007 (as amended from time to time, the “Rights Agreement”), between Vertrue Incorporated,
a Delaware corporation (the “Company”), and American Stock Transfer & Trust Company, a New York
corporation, as Rights Agent (the “Rights Agent”, which term shall include any successor Rights
Agent under the Rights Agreement), to purchase from the Company at any time after the Separation
Time (as such term is defined in the Rights Agreement) and prior to the close of business on July
3, 2009, one fully paid share of one one-hundredth of a fully paid share of Participating Preferred
Stock, no par value (the “Preferred Stock”), of the Company (subject to adjustment as provided in
the Rights Agreement) at the Exercise Price referred to below, upon presentation and surrender of
this Rights Certificate with the Form of Election to Exercise duly executed at the principal office
of the Rights Agent in The City of New York. The Exercise Price shall initially be $240.00

 

 

per Right and shall be subject to adjustment in certain events as provided in the Rights Agreement.

          In certain circumstances described in the Rights Agreement, the Rights evidenced hereby may
entitle the registered holder thereof to purchase securities of an entity other than the Company or
securities of the Company other than Preferred Stock or assets of the Company, all as provided in
the Rights Agreement.

          This Rights Certificate is subject to all of the terms, provisions and conditions of the
Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is hereby made for a full
description of the rights, limitations of rights, obligations, duties and immunities hereunder of
the Rights Agent, the Company and the holders of the Rights Certificates. Copies of the Rights
Agreement are on file at the principal office of the Company and are available without cost upon
written request.

          This Rights Certificate, with or without other Rights Certificates, upon surrender at the
office of the Rights Agent designated for such purpose, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor evidencing an aggregate number of Rights equal to
the aggregate number of Rights evidenced by the Rights Certificate or Rights Certificates
surrendered. If this Rights Certificate shall be exercised in part, the registered holder shall be
entitled to receive, upon surrender hereof, another Rights Certificate or Rights Certificates for
the number of whole Rights not exercised.

          Subject to the provisions of the Rights Agreement, each Right evidenced by this Certificate
may be (a) redeemed by the Company under certain circumstances, at

-2-

 

its option, at a redemption
price of $0.001 per Right or (b) exchanged by the Company under certain circumstances, at its
option, for one share of Common Stock or one one-hundredth of a share of Preferred Stock per Right
(or, in certain cases, other securities or assets of the Company), subject in each case to
adjustment in certain events as provided in the Rights Agreement.

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

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

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

Date:                     ,
                    

-3-

 

	 	 	 	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	Vertrue Incorporated	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By	 	 	 	 
	 	 	 	 	 	 	 	 	 
	Name:	 	 	 	 	 	Name:	 	 
	Title:	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Countersigned:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	American Stock Transfer	 	 	 	 	 	 	 	 
	and Trust Company	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	Authorized Signature	 	 	 	 	 	 	 	 

-4-

 

[Form of Reverse Side of Rights Certificate]

FORM OF ASSIGNMENT

(To be executed by the registered holder if such

holder desires to transfer this Rights Certificate.)

FOR VALUE RECEIVED
                                        
 hereby

	 	 	 
	sells, assigns and transfers unto
	 	 
	 

	 	 
	 

	 	(Please print name
	 
	 	 
	 
	and address of transferee)

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

Dated:                     ,
                    

	 	 	 	 	 
	Signature Guaranteed:
	 	 	 	 
	 	 	 
	 

	 	 	 	Signature
	 

	 	 	 	(Signature must correspond to name as written upon
the face of this Rights Certificate in every
particular, without alteration or enlargement or any
change whatsoever)

          Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers,
savings and loan associations and credit unions with membership in an approved signature guarantee
Medallion program), pursuant to Exchange Act Rule 17Ad-15.

 

(To be completed if true)

          The undersigned hereby represents, for the benefit of all holders of Rights and shares of
Common Stock, that the Rights evidenced by this Rights Certificate are not, and, to the knowledge
of the undersigned, have never been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).

 

 

	 	 	 
	 

	 	 
	 

	 	Signature
	 
	 	 
	 

	 	 

NOTICE

          In the event the certification set forth above is not completed in connection with a purported
assignment, the Company will deem the Beneficial Owner of the Rights evidenced by the enclosed
Rights Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as defined in
the Rights Agreement) or a transferee of any of the foregoing and accordingly will deem the Rights
evidenced by such Rights Certificate to be void and not transferable or exercisable.

-2-

 

[To be attached to each Rights Certificate]

FORM OF ELECTION TO EXERCISE

(To be executed if holder desires to

exercise the Rights Certificate.)

TO: Vertrue Incorporated

          The undersigned hereby irrevocably elects to exercise
                     whole Rights
represented by the attached Rights Certificate to purchase the shares of Participating Preferred
Stock issuable upon the exercise of such Rights and requests that certificates for such shares be
issued in the name of:

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	Address:
	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Social Security or Other Taxpayer	 	 
	 

	 	Identification Number:	 	 
	 

	 	 	 	 

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

	 	 	 	 	 
	 

	 	 	 	 
	 

	 	Address:
	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	Social Security or Other Taxpayer	 	 
	 

	 	Identification Number:	 	 
	 

	 	 	 	 

Dated:                     , ___

	 	 	 	 	 
	Signature Guaranteed:
	 	 	 	 
	 	 	 
	 

	 	 	 	Signature
	 

	 	 	 	(Signature must correspond to name as written upon
the face of this Rights Certificate in every
particular, without alteration or enlargement or any
change whatsoever)

          Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers,
savings and loan associations and credit unions with membership in an approved signature guarantee
Medallion program), pursuant to Exchange Act Rule 17Ad-15.

 

 

 

(To be completed if true)

          The undersigned hereby represents, for the benefit of all holders of Rights and shares of
Common Stock, that the Rights evidenced by the attached Rights Certificate are not, and, to the
knowledge of the undersigned, have never been, Beneficially Owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).

	 	 	 
	 

	 	 
	 

	 	Signature
	 
	 	 
	 

	 	 

NOTICE

          In the event the certification set forth above is not completed in connection with a purported
exercise, the Company will deem the Beneficial Owner of the Rights evidenced by the attached Rights
Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as defined in the
Rights Agreement) or a transferee of any of the foregoing and accordingly will deem the Rights
evidenced by such Rights Certificate to be void and not transferable or exercisable.

-2-

 

 

EXHIBIT B

FORM OF CERTIFICATE OF DESIGNATION AND TERMS

OF PARTICIPATING PREFERRED STOCK OF VERTRUE INCORPORATED

Pursuant to Section 151 of the General

Corporation Law of the State of Delaware

          The undersigned, _______________, the _______________of Vertrue Incorporation, a Delaware
corporation (the “Corporation”), does hereby certify as follows:

          Pursuant to authority granted by Article FOURTH of the Restated Certificate of Incorporation
of the Corporation, as amended, and in accordance with the provisions of Section 151 of the General
Corporation Law of the State of Delaware, the Board of Directors of the Corporation has adopted the
following resolutions fixing the designation and certain terms, powers, preferences and other
rights of a new series of the Corporation’s Preferred Stock, no par value, and certain
qualifications, limitations and restrictions thereon:

     RESOLVED, that there is hereby established a series of Preferred Stock, no par value,
of the Corporation, and the designation and certain terms, powers, preferences and other
rights of the shares of such series, and certain qualifications, limitations and
restrictions thereon, are hereby fixed as follows:

     (i) The distinctive serial designation of this series shall be “Participating
Preferred Stock” (hereinafter called “this Series”). Each share of this Series
shall be identical in all respects with the other shares of this Series except as
to the dates from and after which dividends thereon shall be cumulative.

     (ii) The number of shares in this Series shall initially be ___, which
number may from time to time be increased or decreased (but not below the number
then outstanding) by the Board of Directors. Shares of this Series purchased by
the Corporation shall be cancelled and shall revert to authorized but unissued shares of Preferred
Stock undesignated as to series. Shares of this Series may be issued in

 

 

fractional shares which are whole number multiples of one one-hundredth of a share,
which fractional shares shall entitle the holder, in proportion to such holder’s
fractional share, to all rights of a holder of a whole share of this Series.

     (iii) The holders of full or fractional shares of this Series shall be
entitled to receive, when and as declared by the Board of Directors, but only out
of funds legally available therefor, dividends, (A) on each date that dividends or
other distributions (other than dividends or distributions payable in Common Stock
of the Corporation) are payable on or in respect of Common Stock comprising part of
the Reference Package (as defined below), in an amount per whole share of this
Series equal to the aggregate amount of dividends or other distributions (other
than dividends or distributions payable in Common Stock of the Corporation) that
would be payable on such date to a holder of the Reference Package and (B) on the
last day of March, June, September and December in each year, in an amount per
whole share of this Series equal to the excess (if any) of $601 over the
aggregate dividends paid per whole share of this Series during the three month
period ending on such last day. Each such dividend shall be paid to the holders of
record of shares of this Series on the date, not exceeding sixty days preceding
such dividend or distribution payment date, fixed for the purpose by the Board of
Directors in advance of payment of each particular dividend or distribution.
Dividends on each full and each fractional share of this Series shall be cumulative
from the date such full or fractional share is originally issued; provided that any
such full or fractional share originally issued after a dividend record date and on
or prior to the dividend payment date to which such record date relates shall not
be entitled to receive the dividend payable on such dividend payment date or any
amount in respect of the period from such original issuance to such dividend
payment date.

     The
term “Reference Package” shall initially mean 1002 shares of Common Stock, par value $0.01 per share (“Common Stock”), of the Corporation. In
the event the Corporation shall at any time after the close of business on ___3 (A) declare or pay a dividend
on

 

			
	1	 	Insert an amount equal to 1/4 of 1% of the
Exercise Price divided by the number of shares of Preferred Stock purchasable
upon exercise of one Right (i.e., a guaranteed 1% dividend). Where a Right is
exercisable for one one-hundredth of a share, this simplifies to one-fourth the
Exercise Price.
	 
	2	 	This number should equal one divided by the
number of shares (or fraction of a share) purchasable upon exercise of one
Right.
	 
	3	 	For a certificate of designation relating to
shares to be issued pursuant to Section 2.3 of the Rights Agreement, insert the
Separation Time. For a certificate of designation relating to shares to be
issued pursuant to Section 3.1(d) of the Rights Agreement, insert the Flip-in
Date.

-2-

 

any Common Stock payable in Common Stock, (B) subdivide any Common Stock or (C)
combine any Common Stock into a smaller number of shares, then and in each such
case the Reference Package after such event shall be the Common Stock that a holder
of the Reference Package immediately prior to such event would hold thereafter as a
result thereof.

          Holders of shares of this Series shall not be entitled to any dividends,
whether payable in cash, property or stock, in excess of full cumulative dividends,
as herein provided on this Series.

          So long as any shares of this Series are outstanding, no dividend (other than
a dividend in Common Stock or in any other stock ranking junior to this Series as
to dividends and upon liquidation) shall be declared or paid or set aside for
payment or other distribution declared or made upon the Common Stock or upon any
other stock ranking junior to this Series as to dividends or upon liquidation,
unless the full cumulative dividends (including the dividend to be paid upon
payment of such dividend or other distribution) on all outstanding shares of this
Series shall have been, or shall contemporaneously be, paid. When dividends are
not paid in full upon this Series and any other stock ranking on a parity as to
dividends with this Series, all dividends declared upon shares of this Series and
any other stock ranking on a parity as to dividends shall be declared pro rata so
that in all cases the amount of dividends declared per share on this Series and
such other stock shall bear to each other the same ratio that accumulated dividends
per share on the shares of the Series and such other stock bear to each other.
Neither the Common Stock nor any other stock of the Corporation ranking junior to
or on a parity with this Series as to dividends or upon liquidation shall be
redeemed, purchased or otherwise acquired for any consideration (or any moneys be
paid to or made available for a sinking fund for the redemption of any shares of
any such stock) by the Corporation (except by conversion into or exchange for stock
of the Corporation ranking junior to this Series as to dividends and upon
liquidation), unless the full cumulative dividends (including the dividend to be
paid upon payment of such dividend, distribution, redemption, purchase or other
acquisition) on all outstanding shares of this Series shall have been, or shall
contemporaneously be, paid.

     (iv) In the event of any merger, consolidation, reclassification 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 the shares of this Series shall at the same
time be similarly exchanged or changed in an amount per whole share equal to the
aggregate amount of stock, securities, cash and/or any other property (payable in
kind), as the case may be, that a holder of the Reference Package would be entitled
to receive as a result of such transaction.

-3-

 

     (v) In the event of any liquidation, dissolution or winding up of the affairs
of the Corporation, whether voluntary or involuntary, the holders of full and
fractional shares of this Series shall be entitled, before any distribution or
payment is made on any date to the holders of the Common Stock or any other stock
of the Corporation ranking junior to this Series upon liquidation, to be paid in
full an amount per whole share of this Series equal to the greater of (A)
$24,0004 or (B) the aggregate amount distributed or to be distributed in
connection with such liquidation, dissolution or winding up to a holder of the
Reference Package (such greater amount being hereinafter referred to as the
“Liquidation Preference”), together with accrued dividends to such distribution or
payment date, whether or not earned or declared. If such payment shall have been
made in full to all holders of shares of this Series, the holders of shares of this
Series as such shall have no right or claim to any of the remaining assets of the
Corporation.

          In the event the assets of the Corporation available for distribution to the
holders of shares of this Series upon any liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to the first paragraph
of this Section (v), no such distribution shall be made on account of any shares of
any other class or series of Preferred Stock ranking on a parity with the shares of
this Series upon such liquidation, dissolution or winding up unless proportionate
distributive amounts shall be paid on account of the shares of this Series, ratably
in proportion to the full distributable amounts for which holders of all such
parity shares are respectively entitled upon such liquidation, dissolution or
winding up.

          Upon the liquidation, dissolution or winding up of the Corporation, the
holders of shares of this Series then outstanding shall be entitled to be paid out
of assets of the Corporation available for distribution to its stockholders all
amounts to which such holders are entitled pursuant to the first paragraph of this
Section (v) before any
payment shall be made to the holders of Common Stock or any other stock of the
Corporation ranking junior upon liquidation to this Series.

          For the purposes of this Section (v), the consolidation or merger of, or
binding statutory share exchange by, the Corporation with any other corporation
shall not be deemed to constitute a liquidation, dissolution or winding up of the
Corporation.

 

			
	4	 	Insert an amount equal to 100 times the
Exercise Price in effect as of the Separation Time. Also note that the
“100” in the footnote should be changed appropriately if the number
of shares in the Reference Package (see p. 3) is other than 100.

-4-

 

     (vi) The shares of this Series shall not be redeemable.

     (vii) In addition to any other vote or consent of stockholders required by law
or by the Restated Certificate of Incorporation of the Corporation, and except as
otherwise required by law, each share (or fraction thereof) of this Series shall,
on any matter, vote as a class with any other capital stock comprising part of the
Reference Package and shall have the number of votes thereon that a holder of the
Reference Package would have.

-5-

 

          IN
WITNESS WHEREOF, the undersigned have signed and attested this certificate on the ___ day
of ___,___.

Attest:

	 	 	 
	 

Name:

	 	 
	Title:
	 	 

-6-

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