Document:

exv10w7

Exhibit 10.7

EXECUTION COPY

THIRD AMENDMENT TO CREDIT AGREEMENT

          THIRD AMENDMENT TO CREDIT AGREEMENT (this “Third Amendment”), dated as of May 14,
2009, by and among TRICO MARINE SERVICES, INC., a Delaware corporation (the “Borrower”),
TRICO MARINE ASSETS INC., a Delaware corporation (“Trico Assets”), as a Guarantor, and
TRICO MARINE OPERATORS, INC., a Louisiana corporation (“Trico Operators”), as a Guarantor,
the Lenders party hereto (each, a “Lender” and, collectively, the “Lenders”) and
NORDEA BANK FINLAND PLC, NEW YORK BRANCH, as Administrative Agent (in such capacity, the
“Administrative Agent”) and Collateral Agent (in such capacity, the “Collateral
Agent”). Unless otherwise indicated, all capitalized terms used herein and not otherwise
defined shall have the respective meanings provided such terms in the Credit Agreement referred to
below.

WITNESSETH:

          WHEREAS, the Borrower, Trico Assets, Trico Operators, the Lenders from time to time party
thereto, and the Administrative Agent are parties to an Amended and Restated Credit Agreement,
dated as of August 29, 2008, and amended by the First Amendment to Credit Agreement, dated as of
March 10, 2009 (as further amended, modified and/or supplemented to, but not including, the date
hereof, the “Credit Agreement”);

          WHEREAS, subject to the terms and conditions of this Third Amendment, the parties hereto wish
to amend certain provisions of the Credit Agreement as herein provided;

          NOW, THEREFORE, it is agreed:

I. Amendments to Credit Agreement.

          1. The definition of “Credit Documents” appearing in Section 1 of the Credit Agreement
is hereby amended by inserting the text “, the Intercreditor Agreement” immediately after the text
“each Security Document” appearing in said definition.

          2. The definition of “DeepOcean Indebtedness” appearing in Section 1 of the Credit
Agreement is hereby amended by inserting the text “(whether or not such Subsidiaries continue to be
Subsidiaries of DeepOcean after the consummation of the DeepOcean Acquisition)” immediately after
each instance of the text “its Subsidiaries” appearing twice in said definition.

          3. The definition of “Guarantor” appearing in Section 1 of the Credit Agreement is
hereby amended and restated in its entirety as follows:

     “Guarantor” shall mean Trico Assets, Trico Operators, any Domestic Subsidiary
which owns directly or indirectly any interest in said Persons and, at any time, any other
Domestic Subsidiary of the Borrower that is a party to the Guaranty at such time.

 

 

          4. The definition of “Material Adverse Effect” appearing in Section 1 of the Credit
Agreement is hereby amended and restated in its entirety as follows:

     ““Material Adverse Effect” shall mean (i) a material adverse effect (w) on the
rights or remedies of the Lenders, (x) on the ability of the Borrower and its Subsidiaries
taken as a whole to perform its or their obligations to the Lenders, (y) on the Transaction
or (z) on the property, assets, operations, liabilities or financial condition of the
Borrower and its Subsidiaries taken as a whole, or (ii) a “Material Adverse Effect” as
defined in the Second-Lien Notes Collateral Documents.”

          5. The definition of “Maturity Date” appearing in Section 1 of the Credit Agreement is
hereby amended and restated in its entirety as follows:

     “Maturity Date” shall mean July 15, 2010.

          6. The definition of “Senior Notes” appearing in Section 1 of the Credit Agreement is
hereby amended and restated in its entirety as follows:

     “Senior Notes” shall mean the 3.00% Senior Convertible Debentures of the
Borrower, due 2027, dated February 7, 2007 (as the same may be amended, restated,
supplemented or otherwise modified from time to time), the Existing Notes and the
Second-Lien Notes.

          6. Section 1 of the Credit Agreement is hereby further amended by adding the following new
definitions in the appropriate alphabetical order:

     “Additional Collateral Vessel” shall have the meaning specified in Section
9.16.

     “Asset Sale” shall mean any transaction or series of related transactions
pursuant to which the Borrower or any of its Subsidiaries directly or indirectly sells,
issues, conveys, transfers, exchanges, leases, charters (other than operating leases and
charters entered into in the ordinary course of business consistent with past practices),
assigns or otherwise transfers for value to any Person (other than (i) with respect to an
Asset Sale of Collateral, to the Borrower or any Guarantor or (ii) with respect to an Asset
Sale that does not involve Collateral, the Borrower or any of its Subsidiaries) any property
or assets (including interests therein), whether now owned or hereafter acquired, of the
Borrower or any of its Subsidiaries; provided, however, that the following
will not be deemed an Asset Sale: (i) the sale of the vessel Northern Gambler and related
assets, (ii) the sale, lease, conveyance, disposition or other transfer by the Borrower or
any of its Subsidiaries of inventory in the ordinary course of business and (iii) the sale,
lease, conveyance, disposition or other transfer of all or substantially all of the assets
of the Borrower pursuant to Section 10.02(vii); provided, further, that an
Event of Loss shall be deemed an Asset Sale. In addition, if the Borrower receives
insurance proceeds of more than $1 million in respect of any partial loss with respect to a
Mortgaged Vessel (that also constitutes Second-Lien Notes Collateral), then to the extent
that (i) the Borrower has not determined, within six months of such partial loss, to apply
such proceeds (or an
equivalent amount of funds) to repairs or improvements of such Mortgaged Vessel (or any
other Mortgaged Vessel (that also constitutes Second-Lien Notes Collateral)), or

 

 

(ii) such proceeds (or an equivalent amount of funds) have not been applied to repairs
or improvements of such Mortgaged Vessel (or any other Mortgaged Vessel (that also
constitutes Second-Lien Notes Collateral)) prior to the expiration of one year after the
receipt of such proceeds, then in each case such proceeds that are not so applied shall be
deemed to be proceeds of an Event of Loss for purposes of this definition.

     “Eligible Asset Sale” shall mean the consummation by the Borrower or any
Subsidiary of the Borrower after the Third Amendment Effective Date of any Asset Sale
resulting in gross cash proceeds to the Borrower of greater than $500,000 but less than
$5,000,000.

     “Exchange Agreement” shall mean each Exchange Agreement, dated May 11, 2009,
among the Borrower and the investors party thereto.

     “Exchange Offer” shall mean the exchange of Existing Notes for Second-Lien
Notes, cash and Equity Interests in accordance with the requirements of the Exchange
Agreements.

     “Existing Notes” shall mean the 6.50% Senior Convertible Debentures of the
Borrower, due 2028, dated as of May 16, 2008 (as the same may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the terms hereof and
thereof).

     “Intercreditor Agreement” shall mean the Intercreditor Agreement executed by
the Collateral Agent, the Second-Lien Notes Collateral Agent, the Borrower and the
Guarantors substantially in the form of Exhibit P.

     “Junior Financing” shall have the meaning specified in Section 10.18.

     “Junior Financing Documentation” shall mean any documentation governing any
Junior Financing.

     “Multiple Asset Sale Proceeds” shall have the meaning specified in Section
4.03(f).

     “Multiple Asset Sale Threshold” shall have the meaning specified in Section
4.03(f).

     “Net Cash Proceeds” shall mean, with respect to any Asset Sale, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a promissory
note, receivable or otherwise, but only as and when received) received by the Borrower or
any of its Subsidiaries from such Asset Sale net of:

     (a) all out-of-pocket expenses and fees relating to such Asset Sale (including legal,
accounting and investment banking fees and sales commissions);

     (b) taxes paid or payable in connection with such Asset Sale; and

 

 

     (c) amounts (i) used to repay Indebtedness that is required to be repaid or otherwise
required to be retained or identified for the benefit of a lender, or (ii) by which any
commitment for revolving indebtedness is required to be permanently reduced, each in
connection with such Asset Sale (other than mandatory repayments under the Second-Lien Notes
Documentation or repayments or commitment reductions under this Agreement).

     “Required Insurance” shall have the meaning specified in Section 15.07.

     “Second-Lien Notes” shall mean the 8.125% Secured Convertible Debentures of the
Borrower, due 2013, dated as of May 14, 2009 (as the same may be amended, restated,
supplemented or otherwise modified from time to time pursuant to Section 10.18), in an
initial aggregate principal amount of $202,812,000 (as such amount may be reduced from time
to time pursuant to prepayments, redemptions or repurchases permitted by Section 10.05).

     “Second-Lien Notes Collateral” shall mean each of the following assets of the
Borrower or the Grantors with respect to which a Lien is granted (or purported to be
granted) as security for the Second-Lien Obligations (as defined in the Intercreditor
Agreement) under the Second-Lien Notes Documentation (as in effect on the Third Amendment
Effective Date): (i) each of the M/V Big Blue River, the M/V Elm River, the M/V Kings River,
the M/V Trico Mystic, the M/V Trico Moon and each Additional Collateral Vessel, all of which
are owned by Trico Assets, (ii) insurance proceeds assigned by Trico Assets pursuant to
second-lien assignments of insurance for each of the M/V Big Blue River, the M/V Elm River,
the M/V Kings River, the M/V Trico Mystic and the M/V Trico Moon, (iii) earnings assigned by
Trico Assets pursuant to second-lien assignments of earnings for each of the M/V Big Blue
River, the M/V Elm River, the M/V Kings River, the M/V Trico Mystic and the M/V Trico Moon,
(iv) charters assigned by Trico Assets pursuant to second-lien assignments of charters for
each of the M/V Big Blue River, the M/V Elm River, the M/V Kings River, the M/V Trico Mystic
and the M/V Trico Moon, (v) the Trico Supply Intercompany Loan Documentation, (vi) the
issued and outstanding equity interests in (a) Trico Assets and Trico Operators and (b) any
other Domestic Subsidiary at any time owned, directly or indirectly, by the Borrower which
owns, directly or indirectly, interests in Trico Assets or Trico Operators, and (vii) other
than the Excluded Second-Lien Collateral (as defined in the Intercreditor Agreement), any
other assets or property of any Credit Party with respect to which a Lien is granted (or
purported to be granted) as security for the Second-Lien Obligations (as defined in the
Intercreditor Agreement) (to the extent that such Collateral also constitutes First-Lien
Collateral (as defined in the Intercreditor Agreement)).

     “Second-Lien Notes Collateral Agent” shall mean the “Trustee” as defined in the
Second-Lien Notes Indenture and any successor thereto.

     “Second-Lien Notes Collateral Documents” shall mean the “Security Documents” as
defined in the Second-Lien Notes Indenture, as amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms hereof and thereof.

 

 

     “Second-Lien Notes Documentation” shall mean the Second-Lien Notes, the
Second-Lien Notes Collateral Documents and all other documents, instruments and agreements
executed and delivered in connection with the Second-Lien Notes, including the Second-Lien
Notes Indenture, as amended, restated, supplemented or otherwise modified from time to time
in accordance with the terms hereof and thereof.

     “Second-Lien Notes Indenture” shall mean the Indenture pursuant to which the
Second-Lien Notes, dated as of May 14, 2009 have been issued.

     “Single Asset Sale Proceeds” shall have the meaning specified in Section
4.03(e).

     “Third Amendment” shall mean the Third Amendment to Credit Agreement, dated as
of May 14, 2009.

     “Third Amendment Effective Date” has the meaning provided in the Third
Amendment.

     “Trico Assets” shall mean Trico Marine Assets, Inc., a Delaware corporation.

     “Trico Operators” shall mean Trico Marine Operators, Inc., a Louisiana
corporation.

          8. Section 4.03 of the Credit Agreement is hereby amended by deleting Section 4.03(e) in its
entirety and inserting the following new Sections 4.03(e), (f) and (g) in lieu thereof:

     “(e) In addition to, but without duplication of Section 4.03(d) or any other mandatory
repayments or commitment reductions required pursuant to this Section 4.03, on the day that
the Borrower or any Subsidiary of the Borrower consummates any Asset Sale resulting in gross
cash proceeds to the Borrower of $5,000,000 or more, the Total Commitment shall be reduced
by an amount equal to 50% of the Net Cash Proceeds from such Asset Sale (the “Single
Asset Sale Proceeds”); provided that if a mandatory commitment reduction shall
be required to be made pursuant to both (i) Section 4.03(d) and (ii) this Section 4.03(e),
then the Total Commitment shall be reduced by an amount equal to the greater of the amounts
required to be used to reduce the Total Commitment under such Sections.

     (f) In addition to, but without duplication of Section 4.03(d) or any other mandatory
repayments or commitment reductions pursuant to this Section 4.03, on the day that the
Borrower or any Subsidiary of the Borrower consummates two or more Eligible Asset Sales that
result in gross cash proceeds to the Borrower in excess of $10,000,000 (the “Multiple
Asset Sale Threshold”), the Total Commitment shall be reduced by an amount equal to 50%
of the Net Cash Proceeds from such Eligible Asset Sales (the “Multiple Asset Sale
Proceeds”); provided, however, that on each anniversary of the Third
Amendment Effective Date, $5,000,000 of Multiple Asset Sale Proceeds that have been received
during the preceding 12 months shall be deducted from the cumulative total of Multiple Asset
Sale Proceeds for the purposes of determining whether the Multiple Asset Sale Threshold is
met; provided, further, that if a mandatory

 

 

commitment reduction shall be required to be made pursuant to both (i) Section 4.03(d)
and (ii) this Section 4.03(f), then the Total Commitment shall be reduced by an amount equal
to the greater of the amounts required to be used to reduce the Total Commitment under such
Sections.

     (g) Each reduction to, or termination of, the Total Commitment pursuant to this Section
4.03 shall be applied to proportionately reduce or terminate, as the case may be, the
Revolving Loan Commitment of each Lender.”

          9. Section 8 of the Credit Agreement is hereby amended by adding the following new Section
8.26 in the appropriate sequence:

     “8.26 Status of Obligations. The Obligations constitute “First-Lien
Obligations” as defined in the Intercreditor Agreement and “Senior Permitted Indebtedness”
as defined in the Second-Lien Notes Indenture.”

          10. (i) Section 9.11(c) of the Credit Agreement is hereby amended by inserting the text “the
Intercreditor Agreement (if applicable),” immediately preceding each instance of the text “the
Guaranty” appearing twice in said Section and (ii) Section 9.11(d) of the Credit Agreement is
hereby amended by inserting the text “the Intercreditor Agreement (if applicable),” immediately
preceding the text “the Pledge and Security Agreement” appearing in said Section.

          11. Section 9.14(a) of the Credit Agreement is hereby amended and restated in its entirety as
follows:

     “(a) The Borrower will, and will cause each of its Subsidiaries to, cause each
Mortgaged Vessel to be registered under the laws and flag of Cyprus, Malta, Norway, England,
Bahamas, Vanuatu, Dominica, Mexico, the United States or any other jurisdiction acceptable
to the Required Lenders.”

          12. Section 9 of the Credit Agreement is hereby further amended by adding the following new
Sections 9.16, 9.17 and 9.18 in the appropriate sequence

          “9.16 Additional Collateral Vessels. Each Credit Party will cause the following to
have occurred by no later than June 30, 2009 (or such later date as may be acceptable to the
Administrative Agent):

     (i) Trico Assets (or such other Domestic Subsidiary of the Borrower that owns an
Additional Collateral Vessel (as hereinafter defined)) shall have duly authorized, executed
and delivered, and caused to be recorded in the appropriate vessel registry a Vessel
Mortgage with respect to each of the Vessels listed on Schedule XVIII hereto (each,
an “Additional Collateral Vessel”) and the Vessel Mortgages shall be effective to
create in favor of the Collateral Agent and/or the Lenders a legal, valid and enforceable
first priority security interest in, and lien upon, such Additional Collateral Vessels,
subject only to Permitted Liens;

 

 

     (ii) each Credit Party that owns an Additional Collateral Vessel, shall have duly
authorized, executed and delivered an Assignment of Earnings, an Assignment of Insurances
and an Assignment of Charters (existing or future) for any charter or other similar contract
that has as of such date a remaining term of twelve (12) months or greater, including any
extension option, granted by the relevant Credit Party, and shall use commercially
reasonable efforts to provide appropriate notices and consents relating thereto, together
covering all of such Credit Party’s present and future Earnings and Insurance Collateral, in
each case together with proper Financing Statements (Form UCC-1) and certified copies of
Requests for Information or Copies (Form UCC-11) as required by the Credit Agreement;

     (iii) the Borrower will cause each Domestic Subsidiary of the Borrower which owns any
direct or indirect interest in any Domestic Subsidiary that owns an Additional Collateral
Vessel to execute and deliver a counterpart to the Intercreditor Agreement, the Guaranty and
the Pledge and Security Agreement (or, if requested by the Administrative Agent, a joinder
agreement in respect of the Guaranty and the Pledge and Security Agreement) and, in
connection therewith, promptly execute and deliver all further instruments, and take all
further action, that the Administrative Agent may reasonably require (including, without
limitation, the provision of officers’ certificates, resolutions, good standing certificates
and opinions of counsel, in each case to the reasonable satisfaction of the Administrative
Agent, as well as appraisals and all necessary governmental (domestic and foreign) and third
party approvals and/or consents in connection with the granting of Liens under the Credit
Documents;

     (iv) to the extent that an Additional Collateral Vessel is owned by a Domestic
Subsidiary of the Borrower that is not a Credit Party (and which has not otherwise executed
and delivered the documents described above in clause (iii)), the Borrower will cause such
Domestic Subsidiary (and any Domestic Subsidiary which directly owns the stock of such
Domestic Subsidiary to the extent not a Credit Party) to execute and deliver to the
Administrative Agent a counterpart of the Pledge and Security Agreement (including any
supplemental agreement required to give effect to such security interests purported to be
created by the Pledge and Security Agreement under applicable local law), the Intercreditor
Agreement, the Subsidiaries Guaranty, together with all related documentation (including,
without limitation, opinions of counsel, corporate documents and proceedings and officer’s
certificates) as such Domestic Subsidiary would have been required to deliver pursuant to
Section 15 had such Additional Collateral Vessel been a Collateral Vessel on the Amendment
and Restatement Effective Date;

     (v) if requested by the Administrative Agent, the Borrower shall use commercially
reasonable efforts to cause any manager of an Additional Collateral Vessel to deliver a
subordination agreement reasonably satisfactory in form and substance to the Administrative
Agent; and

     (vi) with respect to each Additional Collateral Vessel being secured, the
Administrative Agent shall have received (w) certificates of ownership from appropriate
authorities showing (or confirmation updating previously reviewed certificates and
indicating) the registered ownership of each Additional Collateral Vessel by Trico Assets

 

 

or the relevant Guarantor, (x) the results of maritime registry searches with respect
to each Mortgaged Vessel, indicating no record liens other than Liens in favor of the
Collateral Agent and/or the Lenders and Permitted Liens, (y) class certificates (to the
extent required under the laws applicable to such Additional Collateral Vessel) from a
classification society listed on Schedule XV to the Credit Agreement or another
classification society reasonably acceptable to the Collateral Agent, indicating that such
Additional Collateral Vessel meets the criteria specified in Section 8.24, (z) a report, in
form and scope reasonably satisfactory to the Administrative Agent, from a firm of
independent marine insurance brokers reasonably acceptable to the Administrative Agent with
respect to the insurance maintained by the Credit Parties in respect of such Additional
Collateral Vessel, together with a certificate from such broker certifying that such
insurances constitute the Required Insurance.

     Except as specifically provided above, all filings, deliveries of instruments and other
actions necessary and desirable in the reasonable opinion of the Administrative Agent to
perfect and preserve such security interests shall have been duly effected and the
Administrative Agent shall have received evidence thereof in form and substance reasonably
satisfactory to the Administrative Agent.

     9.17 Amendments to Vessel Mortgages. Each Credit Party will cause Vessel
Mortgages in effect on the Third Amendment Effective Date to be amended pursuant to an
amendment in form and substance satisfactory to the Administrative Agent to address various
technical changes by no later than June 30, 2009 (or such later date as may be acceptable to
the Administrative Agent).

     9.18 Notice of Asset Sales. At least one (1) Business Day prior to the
consummation of any Asset Sale resulting in gross cash proceeds to the Borrower of more than
$500,000, the Borrower shall deliver to the Administrative Agent a written notice (the
“Asset Sale Notice”) which shall include (A) a reasonable description of the Asset
Sale, including, without limitation, the assets in such Asset Sale and whether such assets
include any Collateral, (B) the gross cash proceeds of such Asset Sale, (C) the Net Cash
Proceeds (including reasonable detail with respect to the calculations related thereto), (D)
whether the proceeds of such sale will constitute Single Asset Sale Proceeds and/or Multiple
Asset Sale Proceeds (including reasonable detail with respect to the calculations related
thereto), (E) the date of the expected consummation of the Asset Sale and (F) if the
Administrative Agent is required to release any Collateral with respect to such Asset Sale,
any required release documentation with respect to the Collateral to be executed by the
Administrative Agent and released to the Company after either (I) the Single Asset Sale
Proceeds and/or Multiple Asset Sale Proceeds, if any, from such sale have been delivered to
the Administrative Agent, (II) the Administrative Agent has received evidence reasonably
satisfactory to the Administrative Agent that such Single Asset Sale Proceeds and/or
Multiple Asset Sale Proceeds, if any, will be delivered to the Administrative Agent directly
by the purchaser of such assets in such Asset Sale on the date of the consummation of such
Asset Sale or (III) promptly following the Administrative Agent’s receipt of the Asset Sale
Notice if the Asset Sale will not result in any Single Asset Sale Proceeds or Multiple Asset
Sale Proceeds.”

 

 

          13. Section 10.01 of the Credit Agreement is hereby amended by (i) deleting the text “and”
appearing at the end of clause (xix) of said Section, (ii) deleting the period (“.”) appearing at
the end of clause (xx) of said Section and inserting the text “; and” in lieu thereof and (iii)
inserting the following new clause (xxi) immediately following clause (xx) of said Section:

     “(xxi) Liens on the Second-Lien Notes Collateral created pursuant to the Second-Lien
Notes Documentation and subject to the terms of the Intercreditor Agreement.”

          14. Section 10.02 of the Credit Agreement is hereby amended by (i) deleting the text “and”
appearing at the end of clause (xi) of said Section, (ii) deleting the period (“.”) appearing at
the end of clause (xii) of said Section and inserting the text “; and” in lieu thereof and (iii)
inserting the following new clause (xiii) immediately following clause (xii) of said Section:

     “(xiii) Trico Assets may transfer any vessel that is registered under the laws and flag
of Mexico (and any equipment or spare parts related thereto) to any subsidiary of the
Borrower that is organized in Mexico so long as the value of the vessels so transferred
shall not exceed $10,000,000 in the aggregate.”

          15. Section 10.04 of the Credit Agreement is hereby amended by (i) deleting the text “and”
appearing at the end of clause (xvii) of said Section, (ii) deleting the period (“.”) appearing at
the end of clause (xviii) of said Section and inserting the text “; and” in lieu thereof and (iii)
inserting the following new clause (xix) immediately following clause (xviii) of said Section:

     “(xix) Indebtedness consisting of a subordinated non-recourse guarantee issued by the
Guarantors (and any additional Subsidiary that becomes a Guarantor after the Third Amendment
Effective Date) for the benefit of the holders of Second-Lien Notes as credit support for
the Borrower’s obligations under the Second-Lien Notes Indenture.”

          16. Section 10 of the Credit Agreement is hereby further amended by inserting the following
new Section 10.18 in the appropriate order:

     “10.18
Voluntary Prepayments, Etc. of Indebtedness. (a) The Borrower
will not, and will not permit any of its Subsidiaries to, directly or indirectly,
voluntarily prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled
maturity thereof in any manner (it being understood that payments of regularly scheduled
principal and interest, fees and legal expenses, as well as mandatory prepayments, including
payments due upon asset sales, shall be permitted) (i) the Senior Notes or (ii) any other
Indebtedness that is required to be subordinated to the Obligations pursuant to the terms of
the Credit Documents (collectively, “Junior Financing”) (other than intercompany
Indebtedness) or make any payment in violation of any subordination terms of any Second-Lien
Documentation or other Junior Financing Documentation, except, so long as no Default shall
have occurred and be continuing or would result therefrom, the conversion and exchange of
the Existing Notes for Second-Lien Notes and Capital Stock

 

 

 pursuant to the Exchange Offer; provided that, in any event, all
Existing Notes so exchanged shall be promptly and permanently cancelled by the Borrower.

     (b) The Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, amend, modify or change any term or condition of any documentation related to
the Senior Notes, including, but not limited to the Second-Lien Notes Documentation, except
as expressly provided in Section 5.3 of the Intercreditor Agreement, or any other Junior
Financing Documentation.”

          17. Section 11.07 of the Credit Agreement is hereby amended by inserting the text “to the
extent required by the Security Documents and the Intercreditor Agreement” immediately after the
text “third Persons” appearing in said Section.

          18. Section 11 of the Credit Agreement is hereby further amended by inserting the following
new Section 11.13 in the appropriate order.

     “Section 11.13 Second-Lien Notes Documentation. (i) Any of the Obligations of
the Credit Parties under the Credit Documents for any reason shall cease to be “Senior
Permitted Indebtedness” under, and as defined in the Second-Lien Notes Indenture or (ii) the
Liens created by the Second-Lien Notes Collateral Documents shall cease, for any reason, to
be second in priority to the Liens of the Collateral Agent on behalf of the Secured
Creditors securing the Obligations in accordance with the terms of the Intercreditor
Agreement.”

          19. Section 14 of the Credit Agreement is hereby amended by inserting the following new
Section 14.18 in the appropriate sequence:

          “14.18. OTHER LIENS ON COLLATERAL; TERMS OF INTERCREDITOR AGREEMENT; ETC. (i)
EACH SECURED PARTY UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT LIENS SHALL BE CREATED ON THE
SECOND-LIEN NOTES COLLATERAL PURSUANT TO THE SECOND-LIEN NOTES DOCUMENTATION, WHICH LIENS
SHALL BE REQUIRED TO BE SECOND IN PRIORITY TO THE LIENS CREATED PURSUANT TO THE CREDIT
DOCUMENTS IN ACCORDANCE WITH THE TERMS OF THE INTERCREDITOR AGREEMENT. THE INTERCREDITOR
AGREEMENT ALSO HAS OTHER PROVISIONS WHICH ARE BINDING UPON THE LENDERS AND THE HEDGING
CREDITORS (AS DEFINED IN THE INTERCREDITOR AGREEMENT). PURSUANT TO THE EXPRESS TERMS OF
SECTION 8.1 OF THE INTERCREDITOR AGREEMENT, IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS
OF THE INTERCREDITOR AGREEMENT AND ANY OF THE CREDIT DOCUMENTS, THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT SHALL GOVERN AND CONTROL.

     (ii) EACH SECURED CREDITOR AUTHORIZES AND INSTRUCTS THE COLLATERAL AGENT TO ENTER INTO
THE INTERCREDITOR AGREEMENT ON BEHALF OF EACH SECURED CREDITOR, AND TO TAKE ALL ACTIONS (AND
EXECUTE ALL DOCUMENTS) REQUIRED (OR DEEMED ADVISABLE) BY

 

 

IT IN ACCORDANCE WITH THE TERMS OF THE INTERCREDITOR AGREEMENT.

     (iii) THE PROVISIONS OF THIS SECTION 14.18 ARE NOT INTENDED TO SUMMARIZE ALL RELEVANT
PROVISIONS OF THE INTERCREDITOR AGREEMENT, THE FORM OF WHICH IS ATTACHED AS AN EXHIBIT TO
THIS AGREEMENT. REFERENCE MUST BE MADE TO THE INTERCREDITOR AGREEMENT ITSELF TO UNDERSTAND
ALL TERMS AND CONDITIONS THEREOF. EACH SECURED CREDITOR IS RESPONSIBLE FOR MAKING ITS OWN
ANALYSIS AND REVIEW OF THE INTERCREDITOR AGREEMENT AND THE TERMS AND PROVISIONS THEREOF, AND
NO AGENT (AND NONE OF ITS AFFILIATES) MAKES ANY REPRESENTATION TO ANY SECURED CREDITOR AS TO
THE SUFFICIENCY OR ADVISABILITY OF THE PROVISIONS CONTAINED IN THE INTERCREDITOR AGREEMENT.”

          20. The Credit Agreement is hereby further amended by adding Exhibit P to the Credit Agreement
in the form of Exhibit P attached hereto.

          21. The Credit Agreement is hereby further amended by adding Schedule XVIII to the Credit
Agreement in the form of Schedule XVIII attached hereto.

II. Miscellaneous Provisions.

          1. In order to induce the Lenders to enter into this Third Amendment, the Borrower hereby
represents and warrants that (i) no Default or Event of Default exists as of the Third Amendment
Effective Date (as defined herein) before or after giving effect to this Third Amendment and (ii)
all of the representations and warranties contained in the Credit Agreement or the other Credit
Documents are true and correct in all material respects on the Third Amendment Effective Date both
before and after giving effect to this Third Amendment, with the same effect as though such
representations and warranties had been made on and as of the Third Amendment Effective Date (it
being understood that any representation or warranty made as of a specific date shall be true and
correct in all material respects as of such specific date).

          2. The Credit Agreement is modified only by the express provisions of this Third Amendment and
this Third Amendment shall not constitute a modification, acceptance or waiver of any other
provision of the Credit Agreement or any other Credit Document except as specifically set forth
herein.

          3. This Third Amendment may be executed in any number of counterparts and by the different
parties hereto on separate counterparts, each of which counterparts when executed and delivered
shall be an original, but all of which shall together constitute one and the same instrument. A
complete set of counterparts shall be lodged with the Borrower and the Administrative Agent.

          4. THIS THIRD AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

 

 

          5. This Third Amendment shall become effective on the date (the “Third Amendment
Effective Date”) when (i) the Borrower, each other Credit Party and the Required Lenders shall
have signed a counterpart hereof (whether the same or different counterparts) and shall have
delivered (including by way of facsimile or other electronic transmission) the same to White &
Case LLP, 1155 Avenue of the Americas, New York, NY 10036; Attention: May Yip (facsimile number:
212-354-8113 / email: myip@whitecase.com), (ii) the Exchange Offer shall have been consummated in
accordance with the terms of the Exchange Agreements, without giving effect to any amendment,
modification or waiver thereof which is materially adverse to the Lenders without the prior
consent of the Administrative Agent and (iii) the Borrower shall have delivered to the
Administrative Agent a copy of each of the Second-Lien Notes Documentation and the Exchange
Agreements, together with all modifications, amendments and waivers thereto through and including
the Third Amendment Effective Date, certified as true and correct by the chairman of the board,
the chief executive officer, the president or any vice president of the Borrower.

          6. From and after the Third Amendment Effective Date, all references in the Credit Agreement
and each of the other Credit Documents to the Credit Agreement shall be deemed to be references to
the Credit Agreement, as modified hereby.

***

 

 

          IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute
and deliver this Third Amendment as of the date first above written.

	 	 	 	 	 
	 	TRICO MARINE SERVICES, INC.

 	 
	 	By:  	/s/ Geoff A. Jones
 	 
	 	 	Name:  	Geoff A. Jones 	 
	 	 	Title:  	Vice President and

Chief Financial Officer 	 
	 
	 	TRICO MARINE ASSETS INC.

 	 
	 	By:  	/s/ Rishi A. Varma
 	 
	 	 	Name:  	Rishi A. Varma 	 
	 	 	Title:  	Vice President and Corporate Secretary 	 
	 
	 	TRICO MARINE OPERATORS, INC.

 	 
	 	By:  	/s/ Rishi A. Varma
 	 
	 	 	Name:  	Rishi A. Varma 	 
	 	 	Title:  	Vice President and Corporate Secretary 	 
	 

signature page to Third Amendment Trico $50MM Credit Agreement

 

 

	 	 	 	 	 
	 	NORDEA BANK FINLAND PLC, NEW YORK BRANCH,

Individually and as Administrative Agent and Lead

Arranger

 	 
	 	By:  	/s/ Martin Lunder
 	 
	 	 	Name:  	Martin Lunder 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	 	 
	 	By:  	                                              /s/ Martin Kahm
 	 
	 	 	Name:  	Martin Kahm 	 
	 	 	Title:  	Vice President 	 
	 

signature page to Third Amendment Trico $50MM Credit Agreement

 

 

	 	 	 	 	 
	 	SIGNATURE PAGE TO THE THIRD AMENDMENT TO CREDIT AGREEMENT,
DATED AS OF THE FIRST DATE WRITTEN ABOVE, AMONG TRICO MARINE
SERVICES, INC., TRICO MARINE ASSETS INC., TRICO MARINE
OPERATORS, INC., VARIOUS FINANCIAL INSTITUTIONS AND NORDEA
BANK FINLAND PLC, NEW YORK BRANCH, AS ADMINISTRATIVE AGENT

NAME OF INSTITUTION:

NORDEA BANK NORGE ASA, CAYMAN ISLANDS BRANCH

 	 
	 	By:  	/s/ Martin Lunder
 	 
	 	 	Name:  	Martin Lunder 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	 	 
	 	By:  	                                   /s/ Martin Kahm
 	 
	 	 	Name:  	Martin Kahm 	 
	 	 	Title:  	Vice President 	 
	 

signature page to Third Amendment Trico $50MM Credit Agreement

 

 

ANNEX I

Additional Collateral Vessels

	 	 	 
	Name of Vessel	 	Jurisdiction of Flag
	 
	 	 
	TRUCKEE RIVER

	 	Dominica
	 
	 	 
	CHARLES RIVER

	 	U.S.
	 
	 	 
	POWDER RIVER

	 	U.S.
	 
	 	 
	ROE RIVER

	 	Dominica
	 
	 	 
	STONES RIVER

	 	U.S.
	 
	 	 
	BUFFALO RIVER

	 	U.S.
	 
	 	 
	ELKHORN RIVER

	 	U.S.
	 
	 	 
	WOLF RIVER

	 	U.S.
	 
	 	 
	SOUTHERN RIVER

	 	U.S.
	 
	 	 
	PECOS RIVER

	 	Dominica
	 
	 	 
	SUWANNEE RIVER

	 	Dominica
	 
	 	 
	RUBY RIVER

	 	U.S.
	 
	 	 
	CANE RIVER

	 	U.S.
	 
	 	 
	RAIN RIVER

	 	U.S.
	 
	 	 
	MIAMI RIVER

	 	U.S.
	 
	 	 
	SAVANNAH RIVER

	 	U.S.
	 
	 	 
	PALMA RIVER

	 	Mexico
	 
	 	 
	OAK RIVER

	 	Dominica
	 
	 	 
	TRINITY RIVER

	 	Dominicaexv4w1

Exhibit 4.1

 

ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

and

COMPUTERSHARE TRUST COMPANY, N.A.

Rights Agent

AMENDED AND RESTATED

RIGHTS AGREEMENT

Dated as of May 19, 2009

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	 
	 	 	 	 
	Section 1. Certain Definitions 
	 	 	2	 
	 
	 	 	 	 
	Section 2. Appointment of Rights Agent 
	 	 	5	 
	 
	 	 	 	 
	Section 3. Issue of Rights and Right Certificates
	 	 	5	 
	 
	 	 	 	 
	Section 4. Form of Right Certificates
	 	 	7	 
	 
	 	 	 	 
	Section 5. Execution, Countersignature and Registration
	 	 	7	 
	 
	 	 	 	 
	Section 6. Transfer, Split-up, Combination and Exchange
of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates
	 	 	8	 
	 
	 	 	 	 
	Section 7. Exercise of Rights; Expiration Date of Rights
	 	 	8	 
	 
	 	 	 	 
	Section 8. Cancellation and Destruction of Right Certificates
	 	 	10	 
	 
	 	 	 	 
	Section 9. Reservation and Availability of Capital Stock
	 	 	10	 
	 
	 	 	 	 
	Section 10. Preferred Shares Record Date
	 	 	11	 
	 
	 	 	 	 
	Section 11. Adjustment of Purchase Price, Number of
Shares or Number of Rights
	 	 	12	 
	 
	 	 	 	 
	Section 12. Certificate of Adjustment
	 	 	18	 
	 
	 	 	 	 
	Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning Power 
	 	 	18	 
	 
	 	 	 	 
	Section 14. Fractional Rights and Fractional Shares
	 	 	19	 
	 
	 	 	 	 
	Section 15. Rights of Action 
	 	 	20	 
	 
	 	 	 	 
	Section 16. Agreement of Right Holders
	 	 	21	 
	 
	 	 	 	 
	Section 17. Right Certificate Holder Not Deemed a Stockholder
	 	 	21	 
	 
	 	 	 	 
	Section 18. Concerning the Rights Agent
	 	 	21	 
	 
	 	 	 	 
	Section 19. Merger or Consolidation or Change of Name of Rights Agent
	 	 	22	 
	 
	 	 	 	 
	Section 20. Duties of Rights Agent
	 	 	22	 
	 
	 	 	 	 
	Section 21. Change of Rights Agent
	 	 	24	 
	 
	 	 	 	 
	Section 22. Issuance of New Right Certificates and Additional Rights 
	 	 	25	 
	 
	 	 	 	 
	Section 23. Redemption 
	 	 	25	 
	 
	 	 	 	 
	Section 24. Exchange 
	 	 	26	 

 

 

	 	 	 	 	 
	 	 	Page
	 
	Section 25. Notice of Certain Events 
	 	 	27	 
	 
	 	 	 	 
	Section 26. Notices 
	 	 	28	 
	 
	 	 	 	 
	Section 27. Supplements and Amendments 
	 	 	28	 
	 
	 	 	 	 
	Section 28. Successors 
	 	 	29	 
	 
	 	 	 	 
	Section 29. Benefits of this Agreement 
	 	 	29	 
	 
	 	 	 	 
	Section 30. Severability 
	 	 	29	 
	 
	 	 	 	 
	Section 31. Governing Law
	 	 	29	 
	 
	 	 	 	 
	Section 32. Counterparts
	 	 	29	 
	 
	 	 	 	 
	Section 33. Descriptive Headings
	 	 	29	 
	 
	 	 	 	 
	Signatures
	 	 	30	 

	 	 	 
	Exhibit A -

	 	Statement of Rights and Preferences of Series A Junior Participating Preferred
Stock of 

Rocky Mountain Chocolate Factory, Inc.
	 
	 	 
	Exhibit B -

	 	Form of Rights Certificate
	 
	 	 
	Exhibit C -

	 	Summary of Rights to Purchase Preferred Shares

 

 

AMENDED AND RESTATED

RIGHTS AGREEMENT

          This AMENDED AND RESTATED RIGHTS AGREEMENT, is made and entered into as of May 19, 2009 (the
“Agreement”), between ROCKY MOUNTAIN CHOCOLATE FACTORY, INC., a Colorado corporation (the
“Company”), and COMPUTERSHARE TRUST COMPANY, N.A., as Rights Agent (the “Rights Agent”), and
amends and restates the prior Rights Agreement, dated May 18, 1999 between the Company and
American Securities Transfer & Trust, Inc., predecessor to the Rights Agent (such prior Rights
Agreement the “Original Agreement”).

W I T N E S S E T H:

          WHEREAS, on May 18, 1999, the Company and American
Securities Transfer & Trust, Inc., the predecessor Rights Agent, entered into the Original Agreement;

     WHEREAS, in connection with the Original Agreement, the Board of Directors of the Company (the
“Board”) authorized and declared a dividend of one Right for each share of Common Stock, par value
$0.03 per share, of the Company (the “Common Stock”) outstanding at the close of business on May
18, 1999 (the “Record Date”), and has authorized the issuance of one Right (as such number may
hereafter be adjusted pursuant to the provisions of this Agreement) with respect to each share of
Common Stock that shall become outstanding between the Record Date and the earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date; provided, however, that
Rights may be issued with respect to shares of Common Stock that shall become outstanding after the
Distribution Date and prior to the earlier of the Redemption Date and the Final Expiration Date in
accordance with the provisions of Section 22 of the Original Agreement;

     WHEREAS, each Right initially represented the right to purchase one one-hundredth of a share
of Series A Junior Participating Preferred Stock, par value $0.10 per share, of the Company (the
“Preferred Shares”), having the powers, rights and preferences set forth in the Statement of Rights
and Preferences attached to this Agreement as Exhibit A;

     WHEREAS, the Original Agreement expires by its terms on May 28, 2009 (the “Original Final
Expiration Date”);

     WHEREAS, after thorough and careful consideration, the consultation with its advisors and such
other inquiries as the Board has deemed appropriate, the Board has determined that it is in the
best interests of the Company and its shareholders to amend and restate the Original Agreement to
extend the Original Final Expiration Date to the Final Expiration Date set forth herein so as to
continue the benefits of the Original Agreement beyond the Original Final Expiration Date, to
adjust the number of Preferred Shares that each Right represents the right to purchase from one
one-hundredth to one one-thousandth and to make such other changes to the Original Agreement as the
Board otherwise deems advisable;

     WHEREAS, the Board has determined that, pursuant to the terms of the Original Agreement, the
Original Agreement may be amended and restated as set forth herein without the approval of the
holders of the Rights; and

     WHEREAS, the Company and the Rights Agent desire to amend and restate the Original Agreement
in its entirety to give effect the foregoing changes to the terms and provisions of the Original
Agreement, all as set forth in this Agreement.

1

 

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

     Section 1. Certain Definitions. For purposes of this Agreement, the following terms have the
meanings indicated, whether their use precedes or follows the definition thereof in this
Agreement:

     “Acquiring Person” shall mean any Person who or which, together with all Affiliates and
Associates of such Person, shall be the Beneficial Owner of 15 percent or more of the Common
Shares of the Company then outstanding, but shall not include the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary of the Company, or any
entity holding Common Shares of the Company for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person shall become an Acquiring Person as the result of an
acquisition of Common Shares of the Company by the Company which, by reducing the number of such
shares outstanding, increases the proportionate number of shares beneficially owned by such
Person to 15 percent or more of the Common Shares of the Company then outstanding; provided,
however, that if a Person shall become the Beneficial Owner of 15 percent or more of the Common
Shares of the Company then outstanding by reason of share purchases by the Company and shall,
after such share purchases by the Company, become the Beneficial Owner of any additional Common
Shares of the Company, then such Person shall be deemed to be an Acquiring Person.
Notwithstanding the foregoing, if the Board of Directors of the Company, within 10 days after the
first date on which the Company shall become aware that any Person, together with all Affiliates
and Associates of such Person, is the Beneficial Owner of shares of Common Stock of the Company
such that such person (but for this sentence) would be an Acquiring Person, determines in good
faith that such Person has inadvertently exceeded the thresholds set forth in this definition of
Acquiring Person, and such Person divests as promptly as practicable a sufficient number of
Common Shares of the Company so that such Person would no longer be an Acquiring Person, as
defined pursuant to the foregoing provisions of this definition, then such Person shall not be
deemed to be an Acquiring Person for any purposes of this Agreement. No Person who is the
Beneficial Owner of 15 percent or more of the Common Shares of the Company on the date of this
Agreement shall be deemed to be an Acquiring Person unless and until such Person becomes the
Beneficial Owner of any additional Common Shares of the Company and, immediately after the
acquisition of such additional shares, is the Beneficial Owner of 15 percent or more of the
Common Shares of the Company.

     “Adjustment Shares” shall have the meaning set forth in Section 11(a)(ii) hereof.

     “Affiliate” and “Associate,” when used with reference to any Person, shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act, as in effect on the date of this Agreement.

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

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

2

 

     (ii) which such Person or any of such Person’s Affiliates or Associates has (A) the right to
acquire (whether such right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (other than customary agreements with and
between underwriters and selling group members with respect to a bona fide public offering of
securities), or upon the exercise of conversion rights, exchange rights, rights (other than the
Rights), warrants or options, or otherwise; provided, however, that a Person shall not be deemed
the Beneficial Owner of, or to beneficially own, securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such Person’s Affiliates or
Associates until such tendered securities are accepted for purchase or exchange; or (B) the right
to vote pursuant to any agreement, arrangement or understanding; provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to beneficially own, any security if the
agreement, arrangement or understanding to vote such security (1) arises solely from a revocable
proxy or consent given to such Person in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable rules and regulations promulgated under the
Exchange Act and (2) is not also then reportable on Schedule 13D under the Exchange Act (or any
comparable or successor report); or

     (iii) which are beneficially owned, directly or indirectly, by any other Person with which
such Person or any of such Person’s Affiliates or Associates has any agreement, arrangement or
understanding (other than customary agreements with and between underwriters and selling group
members with respect to a bona fide public offering of securities) for the purpose of acquiring,
holding, voting (except to the extent contemplated by the proviso in clause (ii)(B) of this
definition) or disposing of any securities of the Company.

Notwithstanding anything in this definition of Beneficial Ownership to the contrary, the phrase
“then outstanding,” when used with reference to a Person’s Beneficial Ownership of securities of
the Company, shall mean the number of such securities then issued and outstanding together with the
number of such securities not then actually issued and outstanding which such Person would be
deemed to own beneficially hereunder.

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

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

     “Common Shares” when used with reference to the Company shall mean the shares of Common Stock
of the Company. “Common Shares” when used with reference to any Person other than the Company
shall mean the capital stock (or equity interest) with the greatest voting power of such other
Person or, if such other Person is a Subsidiary of another Person, the Person or Persons which
ultimately control such first-mentioned Person.

     “Common share equivalents” shall have the meaning set forth in Section 11(a)(iii) hereof.

     “Common Stock” shall have the meaning set forth in the introductory paragraph of this
Agreement.

3

 

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

     “Equivalent preferred shares” shall have the meaning set forth in Section 11(b) hereof.

     “Exchange Act” shall mean the Securities Exchange Act of 1934, as in effect on the date in
question, unless otherwise specifically provided.

     “Exchange Ratio” shall have the meaning set forth in Section 24(a) hereof.

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

     “Flip-In Event” shall have the meaning set forth in Section 11(a)(ii) hereof.

     “Flip-In Trigger Date” shall have the meaning set forth in Section 11(a)(iii)
hereof.

     “Flip-Over Event” shall have the meaning set forth in Section 13(a) hereof.

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

     “Preferred Shares” shall have the meaning set forth in the introductory paragraph of this
Agreement. Any reference in this Agreement to Preferred Shares shall be deemed to include any
authorized fraction of a Preferred Share, unless the context otherwise requires.

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

     “Purchase Price” with respect to each Right shall mean $30.00, as such amount may from time to
time be adjusted as provided herein, and shall be payable in lawful money of the United States of
America. All references herein to the Purchase Price shall mean the Purchase Price as in effect at
the time in question.

     “Record Date” shall have the meaning set forth in the introductory paragraph of this
Agreement.

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

     “Redemption Price” shall have the meaning set forth in Section 23 hereof.

     “Right Certificate” shall mean a certificate evidencing a Right in substantially the form
attached to this Agreement as Exhibit B.

     “Rights” shall mean the rights to purchase Preferred Shares (or other securities) as
provided in this Agreement.

     “Securities Act” shall mean the Securities Act of 1933, as in effect on the date in
question, unless otherwise specifically provided.

4

 

     “Shares Acquisition Date” shall mean the first date of public announcement by the Company or
an Acquiring Person that an Acquiring Person has become such.

     “Statement of Rights and Preferences” shall mean the Statement of Rights and Preferences of
Series A Junior Participating Preferred Stock of Rocky Mountain Chocolate Factory, Inc. setting
forth the powers, preferences, rights, qualifications, limitations and restrictions of Series A
Junior Participating Preferred Stock of the Company, a copy of the form of which is attached to
this Agreement as Exhibit A.

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

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

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

     Section 2. Appointment of Rights Agent. The company hereby appoints the Rights Agent to act
as agent for the Company in accordance with the terms and conditions hereof, and the Rights Agent
hereby accepts such appointment. The Company may from time to time appoint such co-Rights Agent
as it may deem necessary or desirable, upon ten (10) days’ prior written notice to the Rights
Agent. The Rights Agent shall have no duty to supervise, and shall in no event be liable for, the
acts or omissions of any such co-Rights Agent.

     Section 3. Issue of Rights and Right Certificates.

          (a) One Right shall be associated with each Common Share outstanding on the Record Date, each
additional Common Share that shall become outstanding between the Record Date and the earliest of
the Distribution Date, the Redemption Date and the Final Expiration Date, and each additional
Common Share with which Rights are issued after the Distribution Date and prior to the earlier of
the Redemption Date and the Final Expiration Date as provided in Section 22 hereof; provided,
however, that, if the number of outstanding Rights are combined into a smaller number of
outstanding Rights pursuant to Section 11 hereof, the appropriate fractional Right determined
pursuant to such Section shall thereafter be associated with each such Common Share.

          (b) Until the earlier of (i) the tenth day after the Shares Acquisition Date and (ii) the
tenth Business Day (or such later date as may be determined by action of the Board of Directors
of the Company prior to such time as any Person becomes an Acquiring Person) after the date of
the commencement by any Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any Subsidiary of the Company, or any entity holding
Common Shares of the Company for or pursuant to the terms of any such plan) of, or of the first
public announcement of the intention of any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary of the Company, or any
entity holding Common Shares of the Company for or pursuant to the terms of any such plan) to
commence, a tender or exchange offer the consummation of which would result in any Person
becoming the Beneficial Owner of Common Shares aggregating 15 percent or more of the then
outstanding Common Shares (including any such date which is after the date of this Agreement and
prior to the issuance of the Rights; the earlier of such dates being herein referred to as the
“Distribution

5

 

Date”), (x) the Rights will be evidenced (subject to the provisions of Section 3(c) hereof)
by the certificates for Common Shares registered in the names of the holders thereof (which
certificates shall also be deemed to be Right Certificates) and not by separate Right
Certificates, and (y) the Rights, including the right to receive Right Certificates, will be
transferable only in connection with the transfer of Common Shares. As soon as practicable after
the Distribution Date, the Company will prepare and execute, the Rights Agent will countersign,
and the Company will send or cause to be sent (and the Rights Agent will, if requested, send) by
first-class, insured, postage-prepaid mail, to each record holder of Common Shares as of the
close of business on the Distribution Date, at the address of such holder shown on the records of
the Company, a Right Certificate evidencing one whole Right for each Common Share (or for the
number of Common Shares with which one whole Right is then associated if the number of Rights per
Common Share held by such record holder has been adjusted in accordance with the provision in
Section 3(a) hereof) so held. If the number of Rights associated with each Common Share has been
adjusted in accordance with the provision in Section 3(a) hereof, at the time of distribution of
the Right Certificates, the Company may make any necessary and appropriate rounding adjustments
so that Right Certificates representing only whole numbers of Rights are distributed and cash is
paid in lieu of any fractional Right in accordance with Section 14 hereof. As of and after the
Distribution Date, the Rights will be evidenced solely by such Right Certificates.

          (c) On the Record Date, or as soon as practicable thereafter, the Company will send a copy
of a Summary of Rights to Purchase Preferred Shares, in substantially the form attached to this
Agreement as Exhibit C (the ''Summary of Rights”), by first-class, postage-prepaid mail,
to each record holder of Common Shares as of the close of business on the Record Date, at the
address of such holder shown on the records of the Company. With respect to any certificate for
Common Shares outstanding as of the Record Date, until the earliest of the Distribution Date, the
Redemption Date and the Final Expiration Date, the Rights will be evidenced by such certificates
registered in the names of the holders thereof together with a copy of the Summary of Rights
attached thereto. Until the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date, the surrender for transfer of any certificate for Common Shares outstanding on
the Record Date, with or without a copy of the Summary of Rights attached thereto, shall also
constitute the transfer of the Rights associated with the Common Shares represented thereby.

          (d) Certificates issued for Common Shares after the Record Date, but prior to the earliest
of the Distribution Date, the Redemption Date and the Final Expiration Date, shall have impressed
on, printed on, written on or otherwise affixed to them the following legend:

This certificate also evidences and entitles the holder hereof to certain rights as set
forth in an Amended and Restated Rights Agreement dated as of May 19, 2009, as it may be
amended from time to time (the “Rights Agreement”), between Rocky Mountain Chocolate
Factory, Inc. and COMPUTERSHARE TRUST COMPANY, N.A., 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 Rocky Mountain Chocolate Factory, Inc. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will be evidenced by
separate certificates and will no longer be evidenced by this certificate. Rocky Mountain
Chocolate Factory, Inc. will mail to the holder of this certificate a copy of the Rights
Agreement without charge after receipt of a written request therefor. Under certain
circumstances, as set forth in the Rights Agreement, Rights beneficially owned by an
Acquiring Person or its Affiliates or

6

 

Associates (as such terms are defined in the Rights Agreement) and by any subsequent
holder of such Rights are null and void and nontransferable.

With respect to such certificates containing the foregoing legend, until the earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date, the Rights associated with
the Common Shares represented by such certificates shall be evidenced by such certificates alone,
and the surrender for transfer of any such certificate shall also constitute the transfer of the
Rights associated with the Common Shares represented thereby. In the event that the Company
purchases or acquires any Common Shares after the Record Date but prior to the Distribution Date,
any Rights associated with such Common Shares shall be deemed canceled and retired so that the
Company shall not be entitled to exercise any Rights associated with the Common Shares which are no
longer outstanding.

     Section 4. Form of Right Certificates. The Right Certificates (and the form of election to
purchase and form of assignment to be printed on the reverse side thereof) shall be in
substantially the form attached to this Agreement as Exhibit B and may have such marks of
identification or designation and such legends, summaries or endorsements printed thereon as the
Company may deem appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any securities exchange on which the Rights
may from time to time be listed or of any automated quotations system of a national securities
association on which the Rights may from time to time be registered or quoted, or to conform to
usage. Subject to the provisions of Section 22 hereof, the Right Certificates, whenever issued,
on their face shall entitle the holders thereof to purchase such number of one one-thousandths of
a Preferred Share as shall be set forth therein for the Purchase Price per one one-thousandth of
a Preferred Share, subject to adjustment from time to time as herein provided.

     Section 5. Execution, Countersignature and Registration.

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

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

7

 

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

          (a) Subject to the provisions of Sections 7(e) and 14 hereof, at any time after the close of
business on the Distribution Date, and at or prior to the close of business on the earlier of the
Redemption Date and the Final Expiration Date, any Right Certificate or Right Certificates (except
for Right Certificates representing Rights that have become null and void and nontransferable
pursuant to Section 7(e) hereof or that have been exchanged pursuant to Section 24 hereof or as
otherwise provided herein) may be transferred, split-up, combined or exchanged for another Right
Certificate or Right Certificates representing, in the aggregate, the same number of Rights as the
Right Certificate or Right Certificates surrendered then represented. Any registered holder
desiring to transfer, split-up, combine or exchange any Right Certificate or Right Certificates
shall make such request in writing delivered to the Rights Agent, and shall surrender the Right
Certificate or Right Certificates to be transferred, split-up, combined or exchanged at the
principal office or offices of the Rights Agent designated for such purpose; provided, however,
that neither the Rights Agent nor the Company shall be obligated to take any action whatsoever
with respect to the transfer of any Right Certificate surrendered for transfer until the
registered holder shall have completed and signed the certification of status contained in the
form of assignment on the reverse side of such Right Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request. Thereupon the Rights
Agent shall, subject to Sections 7(e) and 14 hereof, countersign and deliver to the Person
entitled thereto a Right Certificate or Right Certificates, as the case may be, as so requested.
The Company may require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer, split-up, combination or exchange of Right
Certificates.

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

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

          (a) Subject to Section 7(e) hereof and except as otherwise provided herein (including Section
24 hereof), each Right shall entitle the registered holder thereof, upon exercise thereof as
provided herein, to purchase for the Purchase Price, at any time after the Distribution Date and at
or prior to the earliest of (i) the close of business on May 19, 2019 (the “Final Expiration
Date”), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the
“Redemption Date”) and (iii) the time at which such Rights are exchanged as provided in Section 24
hereof, one one-thousandth of a Preferred Share, subject to adjustment from time to time as
provided in Section 11 or 13 hereof.

          (b) The registered holder of any Right Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein) in whole or in part at any time after the Distribution Date,
upon surrender of the Right Certificate, with the form of election to purchase on the reverse side

8

 

thereof duly executed, to the Rights Agent at the principal office or offices of the Rights
Agent designated for such purpose, together with payment of the Purchase Price for each one
one-thousandth of a Preferred Share as to which the Rights are exercised, at or prior to the
earliest of (i) the Final Expiration Date, (ii) the Redemption Date and (iii) the time at which
such Rights are exchanged as provided in Section 24 hereof.

          (b) Upon receipt of a Right Certificate representing exercisable Rights, with the form of
election to purchase duly executed, accompanied by payment of the Purchase Price for the Preferred
Shares (or other securities) to be purchased and an amount equal to any applicable transfer tax
required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof,
in lawful money of the United States of America, in cash or by certified check, cashier’s check or
money order payable to the order of the Company, the Rights Agent shall thereupon (i) either (A)
promptly requisition from any transfer agent of the Preferred Shares (or make available, if the
Rights Agent is a transfer agent for such shares) certificates for the number of Preferred Shares
to be purchased, and the Company hereby irrevocably authorizes its transfer agent to comply with
all such requests, or (B) if the Company shall have elected to deposit the Preferred Shares with a
depositary agent under a depositary arrangement, promptly requisition from the depositary agent
depositary receipts representing the number of one one-thousandth of a Preferred Share to be
purchased (in which case certificates for the Preferred Shares represented by such receipts shall
be deposited by the transfer agent with the depositary agent), and the Company will direct the
depositary agent to comply with all such requests, (ii) when appropriate, promptly requisition
from the Company the amount of cash to be paid in lieu of issuance of fractional shares in
accordance with Section 14 hereof, (iii) promptly after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of the registered holder of such
Right Certificate, registered in such name or names as may be designated by such holder, and (iv)
when appropriate, after receipt, promptly deliver such cash to or upon the order of the registered
holder of such Right Certificate.

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

          (d) Notwithstanding anything in this Agreement to the contrary, any Rights that are at any
time beneficially owned by an Acquiring Person or any Affiliate or Associate of an Acquiring
Person shall be null and void and nontransferable, and any holder of any such Right (including
any purported transferee or subsequent holder) shall not have any right to exercise or transfer
any such Right.

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

          (f) The Company may temporarily suspend, for a period of time not to exceed 90 calendar days
after the Distribution Date, the exercisability of the Rights in order to prepare and file

9

 

a Registration Statement under the Securities Act, on appropriate form, with respect to the
Preferred Shares purchasable upon exercise of the Rights and permit such Registration Statement to
become effective; provided, however, that no such suspension shall remain effective after, and the
Rights shall without any further action by the Company or any other Person become exercisable
immediately upon, the effectiveness of such Registration Statement. Upon any such suspension, the
Company shall issue a public announcement stating that the exercisability of the Rights has been
temporarily suspended and shall issue a further public announcement at such time as the suspension
is no longer in effect. Notwithstanding any provision herein to the contrary, the Rights shall not
be exercisable in any jurisdiction if the requisite qualification under the Blue Sky or securities
laws of such jurisdiction shall not have been obtained or the exercise of the Rights shall not be
permitted under applicable law.

     Section 8. Cancellation and Destruction of Right Certificates. All Right Certificates
surrendered for the purpose of exercise, transfer, split-up, combination or exchange shall, and any
Right Certificate representing Rights that have become null and void and nontransferable pursuant
to Section 7(e) hereof surrendered or presented for any purpose shall, if surrendered or presented
to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in
canceled form, or, if surrendered or presented to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any Right Certificate purchased or
acquired by the Company. The Rights Agent shall deliver all canceled Right Certificates to the
Company, or shall, at the written request of the Company, destroy such canceled Right Certificates,
and in either such case shall deliver a certificate of destruction thereof or a certificate of
cancellation thereof, as may be appropriate, to the Company.

     Section 9. Reservation and Availability of Capital Stock.

          (a) The Company covenants and agrees that it will cause to be reserved and kept available out
of its authorized and unissued Preferred Shares, free from preemptive rights or any right of first
refusal, a number of Preferred Shares sufficient to permit the exercise in full of all outstanding
Rights in accordance with Section 7 hereof.

          (b) In the event that there shall not be sufficient Preferred Shares authorized but unissued
to permit the exercise or exchange of Rights in accordance with Section 11 or 24 hereof, as the
case may be, the Company covenants and agrees that it will take all such action as may be
necessary to authorize additional Preferred Shares for issuance upon the exercise or exchange of
Rights pursuant to Section 11 or 24 hereof, as the case may be; provided, however, that if the
Company is unable to cause the authorization of additional Preferred Shares, then the Company
shall, or in lieu of seeking any such authorization, the Company may, to the extent necessary and
permitted by applicable law and any agreements or instruments in effect prior to the Distribution
Date to which it is a party, (i) upon surrender of a Right, pay cash equal to the Purchase Price
in lieu of issuing Preferred Shares and requiring payment therefor, (ii) upon due exercise of a
Right and payment of the Purchase Price for each Preferred Share as to which such Right is
exercised, issue equity securities having a value equal to the value of the Preferred Shares which
otherwise would have been issuable pursuant to Section 11 or 24 hereof, which value shall be
determined by a nationally recognized investment banking firm selected by the Board of Directors
of the Company, or (iii) upon due exercise of a Right and payment of the Purchase Price for each
Preferred Share as to which such Right is exercised, distribute a combination of Preferred Shares,
cash and/or other equity and/or debt securities having an aggregate value equal to the value of
the Preferred Shares which otherwise would have been issuable

10

 

pursuant to Section 11 or 24 hereof, which value shall be determined by a nationally
recognized investment banking firm selected by the Board of Directors of the Company. To the
extent that any legal or contractual restrictions (pursuant to agreements or instruments in effect
prior to the Distribution Date to which it is a party) prevent the Company from paying the full
amount payable in accordance with the foregoing sentence, the Company shall pay to holders of the
Rights as to which such payments are being made all amounts which are not then restricted on a pro
rata basis as such payments become permissible under such legal or contractual restrictions until
such payments have been paid in full.

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

          (d) So long as the Preferred Shares issuable upon the exercise or exchange of Rights may be
listed on any national securities exchange or automated quotations system of a registered
national securities association on which the Preferred Shares may from time to time be listed,
traded or quoted, the Company covenants and agrees that it will use reasonable efforts to cause,
from and after such time as the Rights become exercisable or exchangeable, all Preferred Shares
reserved for such issuance to be listed on such exchange or approved for quotation in such
quotation system, upon official notice of issuance upon such exercise.

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

     Section 10. Preferred Shares Record Date. Each Person in whose name any certificate for
Preferred Shares or Common Shares or other securities is issued upon the exercise or exchange of
Rights shall for all purposes be deemed to have become the holder of record of the Preferred Shares
or Common Shares or other securities, as the case may be, represented thereby on, and such
certificate shall be dated, the date upon which the Right Certificate evidencing such Rights was
duly surrendered and payment of any Purchase Price (and any applicable transfer taxes) was made;
provided, however, that, if the date of such surrender and payment is a date upon which the
transfer books of the Company for the Preferred Shares or Common Shares or other securities, as the
case may be, are closed, such Person shall be deemed to have become the record holder of such
Preferred Shares or Common Shares or other securities, as the case may be, on, and such certificate
shall be dated, the next succeeding Business Day on which the transfer books of the

11

 

Company for the Preferred Shares or Common Shares or other securities, as the case may be, are
open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a stockholder of the Company with respect to shares for
which the Rights shall be exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to
receive any notice of any proceedings of the Company, except as provided herein.

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

     (a)(i) In the event the Company shall at any time after the date of this Agreement
(A) declare a dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide
the outstanding Preferred Shares, (C) combine the outstanding Preferred Shares into a
smaller number of Preferred Shares or (D) issue any shares of its capital stock in a
reclassification of the Preferred Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this Section 11(a), the Purchase
Price in effect at the time of the record date for such dividend or of the effective date
of such subdivision, combination or reclassification, and the number and kind of shares of
capital stock issuable on such date, shall be proportionately adjusted so that the holder
of any Right exercised after such time shall be entitled to receive the aggregate number
and kind of shares of capital stock which, if such Right had been exercised immediately
prior to such date and at a time when the transfer books of the Company for the Preferred
Shares were open, he would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or reclassification; provided, however,
that in no event shall the consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of the Company issuable upon
exercise of one Right. If an event occurs that would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii) hereof.

          (ii) Subject to Section 24 of this Agreement and the last sentence of Section 23(a)
of this Agreement, in the event any Person becomes an Acquiring
Person (a “Flip-In
Event”), each holder of a Right, except as provided in Section 7(e) hereof, shall
thereafter have a right to receive, upon exercise thereof at a price equal to the then
current Purchase Price multiplied times the number of one one-thousandth of a Preferred
Share for which a Right is then exercisable, in accordance with the terms of this
Agreement and in lieu of Preferred Shares, such number of Common Shares of the Company
(such number of Common Shares being referred to herein as the “Adjustment Shares”) as
shall equal the result obtained by (x) multiplying the then current Purchase Price times
the number of one one-thousandth of a Preferred Share for which a Right is then
exercisable and dividing that product by (y) 50 percent of the then current per share
market price of the Company’s Common Shares (determined pursuant to Section 11(d) hereof)
on the date of the occurrence of such event. In the event that any Person shall become an
Acquiring Person and the Rights shall then be outstanding, the Company shall not take any
action which would eliminate or diminish the benefits intended to be afforded by the
Rights.

12

 

     (iii) In the event that there shall not be sufficient Common Shares authorized but
unissued to permit the exercise in full of the Rights in accordance with Section
11(a)(ii) hereof, the Company shall, to the extent permitted by applicable law and
regulation: (A) determine the excess of (1) the value of the Adjustment Shares issuable
upon the exercise of a Right (the “Current Value”) over (2) the Purchase Price (such
excess to be referred to hereinafter as the “Spread”), and (B) with respect to each
Right, make adequate provision to substitute for the Adjustment Shares, upon payment of
the applicable Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3) other
equity securities of the Company (including, without limitation, shares, or units of
 shares, of preferred stock which the Board of Directors of the Company has deemed to have
the same value as the Common Shares (such shares of preferred stock being referred to
herein as “common share equivalents”)), (4) debt securities of the Company, (5) other
assets or (6) any combination of the foregoing, having an aggregate value equal to the
Current Value as determined by the Board of Directors of the Company; provided, however,
that if the Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within 30 days following the first occurrence of a Flip-In Event (the
“Flip-In Trigger Date”), then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of the Purchase Price,
Common Shares (to the extent available) and then, if necessary, cash, which shares and/or
cash have an aggregate value equal to the Spread. If the Board of Directors of the
Company determines in good faith that it is likely that sufficient additional Common
Shares could be authorized for issuance upon exercise in full of the Rights, the 30-day
period set forth above may be extended to the extent necessary, but not to more than 120
days after the Flip-In Trigger Date, in order that the Company may seek stockholder
approval for the authorization of such additional shares (such period, as it may be
extended, the “Substitution Period”). To the extent the Company determines that some
action need be taken pursuant to the first and/or second sentences of this Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e) hereof, that such
action shall apply uniformly to all outstanding Rights, and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution Period in order to
seek any authorization of additional shares and/or to decide the appropriate form of
distribution to be made pursuant to such first sentence and to determine the value
thereof. In the event of any such suspension, the Company shall deliver a notice to the
Rights Agent and issue a public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a notice to the Rights Agent and a
public announcement at such time as the suspension is no longer in effect. For purposes
of this Section 11(a)(iii), the value of the Common Shares shall be the current per share
market price (as determined pursuant to Section 11(d) hereof) of the Common Shares on the
Flip-In Trigger Date, and the value of any common share equivalent shall be deemed to
have the same value as the Common Shares, on such date.

     (b) In case the Company shall fix a record date for the issuance of rights, options or
warrants to all holders of Preferred Shares entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or purchase Preferred Shares (or shares
having the same rights, privileges and preferences as the Preferred Shares (“equivalent preferred
shares”)) or securities convertible into Preferred Shares or equivalent preferred shares at a
price per Preferred Share or equivalent preferred share (or having a conversion price per share,
if a security convertible into Preferred Shares or equivalent preferred shares) less than the
then current per share market price of the Preferred Shares (as defined in Section 11(d) hereof)
on such record date, the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in

13

 

effect immediately prior to such record date times a fraction, the numerator of which shall
be the number of Preferred Shares outstanding on such record date plus the number of Preferred
Shares which the aggregate offering price of the total number of Preferred Shares and/or
equivalent preferred shares so to be offered (and/or the aggregate initial conversion price of
the convertible securities so to be offered) would purchase at such current market price and the
denominator of which shall be the number of Preferred Shares outstanding on such record date plus
the number of additional Preferred Shares and/or equivalent preferred shares to be offered for
subscription or purchase (or into which the convertible securities so to be offered are initially
convertible); provided, however, that in no event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par value of the shares of capital stock of the
Company issuable upon exercise of one Right. In case such subscription price may be paid in
consideration part or all of which may be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Board of Directors of the Company,
whose determination shall be described in a statement filed with the Rights Agent. Preferred
Shares owned by or held for the account of the Company shall not be deemed outstanding for the
purpose of any such computation. Such adjustment shall be made successively whenever such a
record date is fixed; and in the event that such rights, options or warrants are not so issued,
the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if
such record date had not been fixed.

     (c) In case the Company shall fix a record date for the making of a distribution to all
holders of the Preferred Shares (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or surviving corporation) of
evidences of indebtedness or assets (other than a regular quarterly cash dividend or a dividend
payable in Preferred Shares) or subscription rights or warrants (excluding those referred to in
Section 11(b) hereof), the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such record date
times a fraction, the numerator of which shall be the then current per share market price of the
Preferred Shares on such record date, less the fair market value (as determined in good faith by
the Board of Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent) of the portion of the assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable to one Preferred Share and the
denominator of which shall be such current per share market price of the Preferred Shares;
provided, however, that in no event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of capital stock of the Company to be
issued upon exercise of one Right. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such distribution is not so made, the Purchase Price
shall again be adjusted to be the Purchase Price which would then be in effect if such record
date had not been fixed.

(d)(i) For the purpose of any computation hereunder, other than computations made pursuant
to Section 11(a)(iii) hereof, the “current per share market price” of any security (a
“Security” for the purpose of this Section 11(d)(i)) on any date shall be deemed to be the
average of the daily closing prices per share of such Security for the 30 consecutive
Trading Days (as such term is hereinafter defined) immediately prior to such date, and for
purposes of computations made pursuant to Section 11(a)(iii) hereof, the “current per share
market price” of a Security on any date shall be deemed to be the average of the daily
closing prices per share of such Security for the 10 consecutive Trading Days immediately
following such date; provided, however, that in the event that the current per share market
price of the Security is determined during a period following the announcement by the
issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such

14

 

Security or securities convertible into shares of such Security (other than the Rights), or
(B) any subdivision, combination or reclassification of such Security, and the ex-dividend
date for such dividend or distribution, or the record date for such subdivision,
combination or reclassification, shall not have occurred prior to the commencement of the
requisite 30 Trading Day or 10 Trading Day period, as set forth above, then, and in each
such case, the ''current per share market price” shall be appropriately adjusted to reflect
the current market price per share equivalent of such Security. The closing price for each
day shall be the last sale price as reported by Nasdaq (with respect to securities listed
on Nasdaq), the last sale price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock Exchange or, if the Security
is not listed or admitted to trading on the Nasdaq or the New York Stock Exchange, as
reported in the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which the Security is
listed or admitted to trading or, if the Security is not listed or admitted to trading on
any national securities exchange, the last sale price or, if such last sale price is not
reported, the average of the high bid and low asked prices in the over the counter market
as reported on such other system then in use, or, if on any such date the Security is not
quoted by any such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Security selected by the
Board of Directors of the Company. If on any such date no market maker is making a market
in the Security, the fair value of such shares on such date as determined in good faith by
the Board of Directors of the Company shall be used. The term “Trading Day” shall mean a
day on which the principal national securities exchange on which the Security is listed or
admitted to trading is open for the transaction of business or, if the Security is not
listed or admitted to trading on any national securities exchange, a Business Day.

     (ii) For the purpose of any computation hereunder, the “current per share market
price” of the Preferred Shares shall be determined in accordance with the method set forth
in Section 11(d)(i) hereof. If the Preferred Shares are not publicly traded, the “current
per share market price” of the Preferred Shares shall be conclusively deemed to be the
current per share market price of the Common Shares, as determined pursuant to Section
11(d)(i) hereof (appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof), multiplied times 1,000. If neither
the Common Shares nor the Preferred Shares are publicly held or so listed or traded,
“current per share market price” shall mean the fair value per share as determined in good
faith by the Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent.

     (e) Except as hereinafter provided, no adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least one percent in the
Purchase Price; provided, however, that any adjustments which by reason of this Section 11(e) are
not required to be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the
nearest one one-millionth of a Preferred Share or one ten-thousandth of any other share or
security, as the case may be. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later than the earlier of (i) three years
from the date of the transaction which requires such adjustment and (ii) the date of the
expiration of the right to exercise any Rights.

15

 

     (f) If as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any
Right thereafter exercised shall become entitled to receive any shares of capital stock of the
Company other than Preferred Shares, thereafter the number of such other shares so receivable
upon exercise of any Right shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares
contained in Section 11(a) through (c) hereof, inclusive, and the provisions of Sections 7, 9, 10
and 13 hereof with respect to the Preferred Shares shall apply on like terms to any such other
shares.

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

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

     (i) The Company may elect on or after the date of any adjustment of the Purchase Price to
adjust the number of Rights, in substitution for any adjustment in the number of one
one-thousandth of a Preferred Share purchasable upon the exercise of a Right. Each of the Rights
outstanding after such adjustment of the number of Rights shall be exercisable for the number of
one one-thousandth of a Preferred Share for which a Right was exercisable immediately prior to
such adjustment. Each Right held of record prior to such adjustment of the number of Rights shall
become that number of Rights (calculated to the nearest one ten-thousandth) obtained by dividing
the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall
make a public announcement of its election to adjust the number of Rights, indicating the record
date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This
record date may be the date on which the Purchase Price is adjusted or any day thereafter, but,
if the Right Certificates have been issued, shall be at least 10 days later than the date of the
public announcement. If Right Certificates have been issued, upon each adjustment of the number
of Rights pursuant to this Section 11(i), the Company shall, as promptly as practicable, cause to
be distributed to holders of record of Right Certificates on such record date Right Certificates
evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the Right Certificates
held by such holders prior to the date of adjustment, and upon surrender thereof, if required by
the Company, new Right Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein and shall be registered in the names of the
holders of record of Right

16

 

Certificates on the record date specified in the public announcement.

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

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

     (l) In any case in which this Section 11 shall require that an adjustment in the Purchase
Price be made effective as of a record date for a specified event, the Company may elect to defer
until the occurrence of such event the issuing to the holder of any Right exercised after such
record date of the Preferred Shares and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the Preferred Shares and other capital stock or
securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price
in effect prior to such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument evidencing such holder’s right to receive such
additional shares or securities upon the occurrence of the event requiring such adjustment.

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

     (n) Anything in this Agreement to the contrary notwithstanding, in the event that at any
time after the date of this Agreement and prior to the Distribution Date, the Company shall (i)
declare or pay any dividend on the Common Shares payable in Common Shares or (ii) effect a
subdivision, combination or consolidation of the Common Shares (by reclassification or otherwise
than by payment of dividends in Common Shares) into a greater or lesser number of Common Shares,
then in any such case (A) the number of one one-thousandth of a Preferred Share purchasable after
such event upon proper exercise of each Right shall be determined by multiplying the number of
one one-thousandth of a Preferred Share so purchasable immediately prior to such event times a
fraction, the numerator of which is the number of Common Shares outstanding

17

 

immediately before such event and the denominator of which is the number of Common Shares
outstanding immediately after such event, and (B) each Common Share outstanding immediately after
such event shall have issued with respect to it that number of Rights which each Common Share
outstanding immediately prior to such event had issued with respect to it. The adjustments
provided for in this Section 11(n) shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or consolidation is effected.

     Section 12. Certificate of Adjustment. Whenever an adjustment is made as provided in Section
11 or 13 hereof, the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment, (b) promptly file
with the Rights Agent and with each transfer agent for the Common Shares or the Preferred Shares
a copy of such certificate and mail a brief summary thereof to each holder of a Right Certificate
(or, prior to the Distribution Date, of the Common Shares) in accordance with Section 26 hereof.
The Rights Agent shall be fully protected in relying on any such certificate and on any
adjustment therein contained.

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

          (a) In the event, directly or indirectly, at any time after a Person has become an Acquiring
Person, (i) the Company shall consolidate with, or merge with and into, any other Person, (ii)
any Person shall consolidate with the Company, or merge with and into the Company and the Company
shall be the continuing or surviving corporation of such merger and, in connection with such
merger, all or part of the Common Shares shall be changed into or exchanged for capital stock or
other securities of any other Person (or the Company) or cash or any other property, or (iii) the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or
otherwise transfer), in one or more transactions, assets or earning power aggregating 50 percent
or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to
any other Person other than the Company or one or more of its wholly- owned Subsidiaries (any
such event described in clauses (i), (ii) or (iii) being referred to herein as a “Flip-Over
Event”), then, and in each such case, proper provision shall be made so that (A) each holder of a
Right (except as otherwise provided herein) shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then current Purchase Price multiplied times the number
of one one-thousandth of a Preferred Share for which a Right is then exercisable, in accordance
with the terms of this Agreement and in lieu of Preferred Shares, such number of validly
authorized and issued, fully paid, nonassessable and freely tradable Common Shares of the
Principal Party (as such term is hereinafter defined), free and clear of liens, encumbrances or
other adverse claims, as shall equal the result obtained by (1) multiplying the then current
Purchase Price times the number of one one-thousandth of a Preferred Share for which a Right is
exercisable immediately prior to the first occurrence of a Flip-Over Event (or, if a Flip-In
Event has occurred prior to the first occurrence of a Flip-Over Event, multiplying the number of
such one one-thousandth of a share for which a Right was exercisable immediately prior to the
first occurrence of a Flip-In Event times the Purchase Price in effect immediately prior to such
first occurrence), and dividing that product (which, following the first occurrence of a
Flip-Over Event, shall be referred to as the “Purchase Price” for each Right and for all purposes
of this Agreement) by (2) 50 percent of the then current per share market price of the Common
Shares of such Principal Party (determined pursuant to Section 11(d) hereof) on the date of
consummation of such consolidation, merger, sale or transfer; (B) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale or
transfer, all the obligations and duties of the Company pursuant to this Agreement; (C) the term
“Company” shall thereafter be deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11

18

 

 hereof shall apply only to such Principal Party following the first occurrence of a
Flip-Over Event; (D) such Principal Party shall take such steps (including, but not limited to,
the reservation of a sufficient number of its Common Shares in accordance with Section 9 hereof)
in connection with such consummation as may be necessary to assure that the provisions hereof
shall thereafter be applicable, as nearly as reasonably may be, in relation to the Common Shares
thereafter deliverable upon the exercise of the Rights; and (E) the provisions of Section
11(a)(ii) hereof shall be of no effect following the first occurrence of any Flip-Over Event. The
Company shall not consummate any such consolidation, merger, sale or transfer unless prior
thereto the Company and such Principal Party shall have executed and delivered to the Rights
Agent a supplemental agreement so providing. The Company shall not enter into any transaction of
the kind referred to in this Section 13 if at the time of such transaction there are any rights,
warrants, instruments or securities outstanding or any agreements or arrangements which, as a
result of the consummation of such transaction, would eliminate or substantially diminish the
benefits intended to be afforded by the Rights. The provisions of this Section 13 shall similarly
apply to successive mergers or consolidations or sales or other transfers.

     (b) “Principal Party” shall mean

     (i) in the case of any transaction described in clause (i) or (ii) of the first
sentence of Section 13(a) hereof, the Person that is the issuer of any securities into
which Common Shares of the Company are converted in such transaction, or if there is more
than one issuer, the issuer of Common Shares with the greatest aggregate market value,
and if no securities are so issued, the Person that is the other party to such
transaction, or if there is more than one such Person, the Person having Common Shares
with the greatest aggregate market value; and

     (ii) in the case of any transaction described in clause (iii) of the first sentence
of Section 13(a) hereof, the Person that is the party receiving the greatest portion of
the assets or earning power transferred pursuant to such transaction or transactions;
provided, however, that in any such case, (1) if the Common Shares of such Person are not
at such time and have not been continuously over the preceding twelve-month period
registered under Section 12 of the Exchange Act, and such Person is a direct or indirect
Subsidiary of any Person the Common Shares of which are and have been so registered,
“Principal Party” shall refer to such other Person; and (2) in case such Person is a
Subsidiary, directly or indirectly, of more than one Person, the Common Shares of two or
more of which are and have been so registered, “Principal Party” shall refer to whichever
of such Persons is the issuer of the Common Shares having the greatest aggregate market
value.

     Section 14. Fractional Rights and Fractional Shares.

          (a) The Company may, but shall not be required to, issue fractions of Rights or
distribute Right Certificates which evidence fractional Rights. In Lieu of such fractional
Rights, the Company may pay to the registered holders of the Right Certificates with regard to
which such fractional Rights would otherwise be issuable an amount in cash equal to the same
fraction of the current market value of a whole Right. For purposes of this Section 14(a), the
current market value of a whole Right shall be the closing price of the Rights for the Trading
Day immediately prior to the date on which such fractional Rights would have been otherwise
issuable. The closing price for each day shall be the last sale price as reported by Nasdaq (with
respect to securities listed on Nasdaq), the last sale price, regular way, or, in case no such
sale takes place on such day, the

19

 

average of the closing bid and asked prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to securities listed or admitted
to trading on the New York Stock Exchange or, if the Rights are not listed or admitted to trading
on the Nasdaq or the New York Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on the principal national
securities exchange on which the Security is listed or admitted to trading or, if the Rights are
not listed or admitted to trading on any national securities exchange, the last sale price or, if
such last sale price is not reported, the average of the high bid and low asked prices in the
over the counter market as reported on such other system then in use, or, if on any such date the
Rights are not quoted by any such organization, the average of the closing bid and asked prices
as furnished by a professional market maker making a market in the Rights selected by the Board
of Directors of the Company. If on any such date no market maker is making a market in the
Rights, the fair value of such Rights on such date as determined in good faith by the Board of
Directors of the Company shall be used.

          (b) The Company may, but shall not be required to, issue fractions of Preferred Shares upon
exercise of the Rights or distribute certificates which evidence fractional Preferred Shares. In
lieu of fractional Preferred Shares, the Company may elect to (i) utilize a depository arrangement
as provided by the terms of the Preferred Shares or (ii) in the case of a fraction of a Preferred
Share (other than one one-thousandth of a Preferred Share or any integral multiple thereof), pay to
the registered holders of Right Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the current market value of a whole
Preferred Share, if any are outstanding and publicly traded (or the Formula Number (as such term is
defined in Section 2 of the Statement of Rights and Preferences) then in effect times the current
market value of a whole Common Share if the Preferred Shares are not outstanding and publicly
traded). For purposes of this Section 14(b), the current market value of a Preferred Share (or
Common Share) shall be the closing price of a Preferred Share (or Common Share) (as determined
pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior
to the date of such exercise. If, as a result of an adjustment made pursuant to Section 11 hereof,
the holder of any Right thereafter exercised shall become entitled to receive any securities other
than Preferred Shares, the provisions of this Section 14(b) shall apply, as nearly as reasonably
may be, on like terms to such other securities.

          (c) The holder of a Right by the acceptance of the Right expressly waives his right to receive
any fractional Rights or any fractional shares upon exercise or exchange of a Right except as
provided in this Section 14.

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

20

 

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

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

          (b) after the Distribution Date, the Right Certificates will be transferable, subject to
Section 7(e) hereof, only on the registry books of the Rights Agent if surrendered at the
principal office of the Rights Agent, duly endorsed or accompanied by a proper instrument of
transfer;

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

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

     Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder, as such, of any
Right Certificate shall be entitled to vote or receive dividends or be deemed, for any purpose,
the holder of the Preferred Shares or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or
in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such,
any of the rights of a stockholder of the Company, including, without limitation, any right to
vote for the election of directors or upon any other matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting stockholders (except as provided in Section 25 hereof), or to
receive dividends or other distributions or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been exercised in accordance with the
provisions hereof.

     Section 18. Concerning the Rights Agent.

          (a) The Company agrees to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties hereunder.

21

 

          (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 Right Certificate or certificate for the Preferred Shares or
Common Shares or for other securities of the Company, instrument of assignment or transfer, power
of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement,
or other paper or document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper person or persons, or otherwise upon the
advice of counsel as set forth in Section 20 hereof.

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

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

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

     Section 20. Duties of Rights Agent. The Rights Agent undertakes the duties and obligations
imposed by this Agreement upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates (or, prior to the Distribution Date, of the Common Shares), by
their acceptance thereof, shall be bound:

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

          (b) Whenever in the performance of its duties under this Agreement the Rights Agent shall
deem it necessary or desirable that any fact or matter be proved or established by the Company
prior to taking or suffering any action hereunder, such fact or matter (unless other

22

 

evidence in respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by any one of the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.

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

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

          (e) The Rights Agent shall not be under any responsibility in respect of the validity of this
Agreement or the execution and delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right Certificate; nor shall it be
responsible for any change in the exercisability of the Rights (including the Rights becoming null
and void and nontransferable pursuant to Section 7(e) hereof) or any adjustment in the terms of
the Rights (including the manner, method or amount thereof) provided for in Section 3, 11, 13, 23
or 24 hereof, or the ascertaining of the existence of facts that would require any such change or
adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after
actual notice that such change or adjustment is required); nor shall it by any act hereunder be
deemed to make any representation or warranty as to the authorization or reservation of any
Preferred Shares or Common Shares to be issued pursuant to this Agreement or any Right Certificate
or as to whether any Preferred Shares or Common Shares will, when so issued, be validly authorized
and issued, fully paid and nonassessable.

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

          (g) The Rights Agent is hereby authorized and directed to accept instructions with respect to
the performance of its duties hereunder from any one of the Chairman of the Board, the Chief
Executive Officer, the President, any Vice President, the Secretary or the Treasurer of the
Company, and to apply to such officers for advice or instructions in connection with its duties,
and it shall not be liable for any action taken or suffered by it in good faith in accordance with
instructions of any such officer or for any delay in acting while waiting for those instructions.

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

23

 

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

          (j) The Company agrees to indemnify and to hold the Rights Agent harmless against any loss,
liability or expense (including reasonable fees and expenses of counsel) that the Rights Agent may
incur resulting from its actions as Rights Agent pursuant to this Agreement; provided, however,
that the Rights Agent shall not be indemnified or held harmless with respect to any such loss,
liability, damage or expense incurred by the Rights Agent as a result of, or arising out of, its
own gross negligence, bad faith or willful misconduct. In no case shall the Company be liable with
respect to any action, proceeding, suit or claim against the Rights Agent unless the Rights Agent
shall have notified the Company, by letter or by facsimile confirmed by letter, of the assertion
of any action, proceeding, suit or claim against the Rights Agent, promptly after the Rights Agent
shall have notice of any such assertion of an action, proceeding, suit or claim or have been
served with the summons or other first legal process giving information as to the nature and basis
of the action, proceeding, suit or claim. The Company shall be entitled to participate at its own
expense in the defense of any such action, proceeding, suit or claim, and, if the Company so
elects, the Company shall assume the defense of any such action, proceeding, suit or claim. In the
event that the Company assumes such defense, the Company shall not thereafter be liable for the
fees and expenses of any additional counsel retained by the Rights Agent, so long as the Company
shall retain counsel satisfactory to the Rights Agent, in the exercise of its reasonable judgment,
to defend such action, proceeding, suit or claim. The Rights Agent agrees not to settle any
litigation in connection with any action, proceeding, suit or claim with respect to which it may
seek indemnification from the Company without the prior written consent of the Company.

     Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign
and be discharged from its duties under this Agreement upon 30 days’ notice in writing mailed to
the Company and to each transfer agent of the Common Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates (or, prior to the Distribution Date,
of the Common Shares) by first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days’ notice in writing, mailed to the Rights Agent or successor
Rights Agent, as the case may be, and to each transfer agent of the Common Shares or Preferred
Shares by registered or certified mail, and to the holders of the Right Certificates (or, prior to
the Distribution Date, of the Common Shares) by first-class mail. In the event the transfer agency relationship
in effect between the Company and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties under this
Agreement as of the effective date of such termination, and the Company shall be responsible for sending any required notice. If the Rights Agent shall resign
or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor
to the Rights Agent. If the Company shall fail to make such appointment within a period of 30 days
after giving notice of such removal or after it has been notified in writing of such resignation
or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right
Certificate (or, prior to the Distribution Date, of the Common Shares) (who shall, with such
notice, submit his Right Certificate or, prior to the Distribution Date, the certificate
representing his Common Shares, for inspection by the Company), then the registered holder of any
Right Certificate (or, prior to the Distribution Date, of the Common Shares) may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a corporation organized and
doing business under the laws of the United States or of the State of New York (or of any other
state of the United States so long as such corporation is authorized to conduct a stock transfer
or corporate trust business in the State of New York), in good

24

 

standing, which is authorized under such laws to exercise stock transfer or corporate trust
powers and is subject to supervision or examination by federal or state authority and which has at
the time of its appointment as Rights Agent a combined capital and surplus, including its
Affiliates of at least $50 million; provided that the principal transfer agent for the Common
Shares shall in any event be qualified to be the Rights Agent. After appointment, the successor
Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it
had been originally named as Rights Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Common
Shares or Preferred Shares, and mail a notice thereof in writing to the registered holder of the
Right Certificates (or, prior to the Distribution Date, of the Common Shares). Failure to give any
notice provided for in this Section 21, however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.

     Section 22. Issuance of New Right Certificates and Additional Rights. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option,
issue new Right Certificates evidencing Rights in such form as may be approved by its Board of
Directors of the Company to reflect any adjustment or change made in accordance with the
provisions of this Agreement. In addition, in connection with the issuance or sale of Common
Shares following the Distribution Date and prior to the earlier of the Redemption Date and the
Final Expiration Date, the Company (i) shall, with respect to Common Shares so issued or sold
pursuant to the exercise of stock options or under any employee plan or arrangement, or upon the
exercise, conversion or exchange of securities, notes or debentures issued by the Company, and
(ii) may, in any other case, if deemed necessary or appropriate by the Board of Directors of the
Company, issue Right Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that no such Right Certificate shall be issued if, and
to the extent that, the Company shall be advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the Company or the Person to whom such
Right Certificate would be issued, and no such Right Certificate shall be issued if, and to the
extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.

     Section 23. Redemption.

          (a) A majority of the Board of Directors of the Company may, at its option, at any time prior
to the earlier of (i) the close of business on the tenth day following the Shares Acquisition Date
(or, if the Shares Acquisition Date shall have occurred prior to the Record Date, the close of
business on the tenth day following the Record Date) and (ii) the Final Expiration Date, redeem
all but not less than all the then outstanding Rights at a redemption price of $.01 per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring
after the date hereof (such redemption price being hereinafter referred to as the “Redemption
Price”). The redemption of the Rights by the Board of Directors of the Company may be made
effective at such time, on such basis and with such conditions as the Board of Directors of the
Company in its sole discretion may establish. Notwithstanding anything contained in this Agreement
to the contrary, the Rights shall not be exercisable pursuant to Section 11(a)(ii) prior to the
expiration of the Company’s right of redemption hereunder.

25

 

          (b) Immediately upon the action of the Board of Directors of the Company ordering the
redemption of the Rights pursuant to paragraph (a) of this Section 23, and without any further
action and without any notice, the right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price. Within 10 Business
Days after the action of the Board of Directors of the Company ordering the redemption of the
Rights, the Company shall give notice of such redemption to the holders of the then outstanding
Rights by mailing such notice to all such holders at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Distribution Date, on the registry books of
the transfer agent for the Common Shares. Each such notice of redemption will state the method by
which payment of the Redemption Price will be made. The notice, if mailed in the manner herein
provided, shall be conclusively presumed to have been duly given, whether or not the holder of
Rights receives such notice. In any case, failure to give such notice by mail, or any in the
notice, to any particular holder of Rights shall not affect the sufficiency of notice to other
holders of Rights. Neither the Company nor any of its Affiliates or Associates may redeem, acquire
or purchase for value any Rights at any time in any manner other than that specifically set forth
in this Section 23 or in Section 24 hereof, and other than in connection with the purchase of
Common Shares prior to the Distribution Date.

     Section 24. Exchange.

          (a) The Board of Directors of the Company may, at its option, at any time after any Person
becomes an Acquiring Person, mandatorily exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that shall have become null and void and
nontransferable pursuant to the provisions of Section 7(e) hereof) for Common Shares at an
exchange ratio of one Common Share per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the “Exchange Ratio”). Notwithstanding the foregoing, the Board of
Directors of the Company shall not be empowered to effect such exchange at any time after any
Person (other than the Company, any Subsidiary of the Company, any employee benefit plan of the
Company or of any such Subsidiary, or any entity holding Common Shares of the Company for or
pursuant to the terms of any such plan), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50 percent or more of the Common Shares then outstanding.

          (b) Immediately upon the action of the Board of Directors of the Company ordering the
exchange of any Rights pursuant to paragraph (a) of this Section 24, and without any further
action and without any notice, the right to exercise such Rights shall terminate and the only
right thereafter of a holder of such Rights shall be to receive that number of Common Shares equal
to the number of such Rights held by such holder multiplied times the Exchange Ratio. The Company
shall promptly give public notice of any such exchange; provided, however, that the failure to
give, or any defect in, such notice shall not affect the validity of such exchange. The Company
promptly shall mail a notice of any such exchange, to all the holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the exchange of the Common
Shares for Rights will be effected and, in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected pro rata based on the number of
Rights (other than Rights which have become null and void and nontransferable pursuant to the
provisions of Section 7(e) hereof) held by each holder of Rights.

          (c) In any exchange pursuant to this Section 24, the Company, at its option, may substitute
Preferred Shares (or equivalent preferred shares) for Common Shares exchangeable for Rights, at
the initial rate of one one-thousandth of a Preferred Share (or equivalent preferred share) for
each Common

26

 

Share, as appropriately adjusted to reflect adjustments in the voting rights of the Preferred
Shares pursuant to the terms thereof, so that the fraction of a Preferred Share delivered in lieu
of each Common Share shall have the same voting rights as one Common Share.

          (d) In the event that the number of Common Shares or Preferred Shares which are authorized
but unissued are not sufficient to permit any exchange of Rights as contemplated in accordance
with this Section 24, the Company may, at its option, take all such action as may be necessary to
authorize additional Common Shares or Preferred Shares.

          (e) The Company may, but shall not be required to, issue fractions of Common Shares upon
exchange of Rights pursuant to this Section 24 or distribute certificates which evidence
fractional Common Shares. In lieu of such fractional Common Shares, the Company may pay to the
registered holders of the Right Certificates with regard to which such fractional Common Shares
would otherwise be issuable an amount in cash equal to the same fraction of the current market
value of a whole Common Share for the Trading Day immediately prior to the date of exchange
pursuant to this Section 24. For purposes of this paragraph (e), the current market value of a
whole Common Share shall be the closing price of a Common Share (as determined pursuant to the
second sentence of Section 11(d)(i) hereof).

     Section 25. Notice of Certain Events.

          (a) In case the Company shall propose (i) to pay any dividend payable in capital stock of any
class to the holders of its Preferred Shares or to make any other distribution to the holders of
its Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer to the holders
of its Preferred Shares rights or warrants to subscribe for or to purchase any additional
Preferred Shares or shares of capital stock of any class or any other securities, rights or
options, (iii) to effect any reclassification of its Preferred Shares (other than a
reclassification involving only the subdivision of outstanding Preferred Shares), (iv) to effect
any consolidation or merger into or with, or to effect any sale or other transfer (or to permit
one or more of its Subsidiaries to effect any sale or other transfer), in one or more
transactions, of 50 percent or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person, (v) to effect the liquidation, dissolution
or winding up of the Company, or (vi) to declare or pay any dividend on the Common Shares payable
in Common Shares or to effect a subdivision, combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in Common Shares), then, in each such
case, the Company shall give to each holder of a Right Certificate (or, prior to the Distribution
Date, of the Common Shares), in accordance with Section 26 hereof, a notice of such proposed
action, which shall specify the record date for the purposes of such stock dividend or
distribution of rights or warrants, or the date on which such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution, or winding up is to take place and the date of
participation therein by the holders of the Common Shares and/or Preferred Shares, if any such
date is to be fixed, and such notice shall be so given in the case of any action covered by clause
(i) or (ii) above at least 10 days prior to the record date for determining holders of the
Preferred Shares for purposes of such action, and in the case of any such other action, at least
10 days prior to the date of the taking of such proposed action or the date of participation
therein by the holders of the Common Shares and/or Preferred Shares, whichever shall be the
earlier.

          (b) In case a Flip-In Event shall occur, then the Company shall as soon as practicable
thereafter give to each holder of a Right Certificate (or, prior to the Distribution Date, of
Common Shares), in accordance with Section 26 hereof, a notice of the occurrence of such event,
which notice shall describe such event and the consequences of such event to holders of Rights
under Section 11(a)(ii) hereof.

27

 

     Section 26. Notices. Notices or demands authorized by this Agreement to be given or
made by the Rights Agent or by the holder of any Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Rights Agent) as follows:

Rocky Mountain Chocolate Factory, Inc.

265 Turner Drive

Durango, Colorado 81303

Attention: President

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

Computershare Trust Company, N.A.

350 Indiana St., Suite 750

Golden, Colorado 80401

Attention: Client Services

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

     Section 27. Supplements and Amendments. At any time prior to the Distribution Date and subject
to the last sentence of this Section 27, the Company may by action of its Board of Directors, and
the Rights Agent shall if the Company so directs, supplement or amend any provision of this
Agreement (including, without limitation, the date upon which the Distribution Date shall occur,
the time during which the Rights may be redeemed pursuant to Section 23 or any provision of the
Statement of Rights and Preferences) in any manner without the approval of any holder of the
Rights. From and after the Distribution Date and subject to applicable law, the Company may by
action of its Board of Directors, and the Rights Agent shall if the Company so directs, from time
to time supplement or amend this Agreement without the approval of any holders of Right
Certificates in order (i) to cure any ambiguity or to correct or supplement any provision contained
in this Agreement which may be defective or inconsistent with any other provision of this Agreement
or (ii) to make any other provisions in regard to matters or questions arising hereunder which the
Company may deem necessary or desirable and which shall not adversely affect the interests of the
holders of the Rights or Right Certificates (other than an Acquiring Person or any Affiliate or
Associate of an Acquiring Person). Any supplement or amendment adopted during any period after any
Person has become an Acquiring Person but prior to the Distribution Date shall be null and void
unless such supplement or amendment could have been adopted under the preceding sentence from and
after the Distribution Date. Without limiting the foregoing, the Company may at any time prior to
the Distribution Date amend this Agreement to lower the thresholds set forth in the definition of
Acquiring Person in Section 1 hereof and in Section 3(b) hereof to not less than the greater of (i)
the sum of 0.001 percent and the largest percentage of the outstanding Common Shares then known by
the Company to be beneficially owned by any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary of the Company, or any
entity holding Common Shares of the Company for or pursuant to the terms of any such plan) and (ii)
10 percent. Upon the

28

 

delivery of a certificate from an appropriate officer of the Company which states that the
proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights
Agent shall execute such supplement or amendment; provided, however, that the Rights Agent may, but
shall not be obligated to, enter into any such supplement or amendment which affects its own
rights, duties or immunities under this Agreement. Prior to the Distribution Date, the interests of
the holders of Rights shall be deemed coincident with the interests of the holders of the Common
Shares of the Company. In addition, notwithstanding anything to the contrary contained in this
Agreement, no supplement or amendment to this Agreement shall be made which (i) reduces the
Redemption Price (except as required hereunder by appropriate adjustment to reflect any stock
split, stock dividend or similar transaction occurring after the date of this Agreement) or (ii)
provides for an earlier Final Expiration Date.

     Section 28. Successors. All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Rights Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.

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

     Section 30. Severability. If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or invalidated.

     Section 31. Governing Law. THIS AGREEMENT AND EACH RIGHT CERTIFICATE ISSUED HEREUNDER SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER LAWS OF THE STATE OF COLORADO AND FOR ALL PURPOSES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS TO BE
MADE AND PERFORMED ENTIRELY WITHIN SUCH STATE.

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

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

     Section 34. Force Majeure. Notwithstanding anything to the contrary contained herein, the
Rights Agent shall not be liable for any delays or failures in performance resulting from acts
beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage
of supply, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss
of data due to power failures or mechanical difficulties with information storage or retrieval
systems, labor difficulties, war, or civil unrest.

29

 

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

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Attest:	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Bryan J. Merryman	 	 	 	By:	 	/s/ Franklin E. Crail
	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Bryan J. Merryman
	 	 	 	 	 	Name: Franklin E. Crail

	 

	 	Title:
	 	Chief Operating Office &

Chief Financial Officer
	 	 	 	 	 	Title:   President
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	COMPUTERSHARE TRUST COMPANY, N.A.
	Attest:	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ John M. Wahl	 	 	 	 	 	 	 	By:	 	/s/ Kellie Gwinn
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	John M. Wahl 	 	 	 	 	 	 	 	 	 	Name:	 	Kellie Gwinn 
	 

	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Title:
	 	Corporate Trust Officer 	 	 	 	 	 	 	 	 	 	Title:	 	Vice President 
	 

	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 

30

 

EXHIBIT A

STATEMENT OF RIGHTS AND PREFERENCES OF

SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

of

ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

Series A Junior Participating Preferred Stock

     Section 1. Designation and Amount. The shares of such series shall be designated as “Series A
Junior Participating Preferred Stock” (the “Series A Preferred Stock”). The number of shares
initially constituting the Series A Preferred Stock shall be 50,000; provided, however, that if
more than a total of 50,000 shares of Series A Preferred Stock shall be issuable upon the exercise
of Rights (the “Rights”) issued pursuant to the Amended and Restated Rights Agreement dated as of
May 19, 2009 between the Corporation and Computershare Trust Company, N.A., as Rights Agent (the
“Rights Agreement”), the Board of Directors of the Corporation shall direct by resolution or
resolutions that a certificate be properly executed, acknowledged, filed and recorded providing
for the total number of shares of Series A Preferred Stock authorized to be issued to be increased
(to the extent that the Articles of Incorporation then permits) to the largest number of whole
 shares (rounded up to the nearest whole share) issuable upon exercise of such Rights.

     Section 2. Dividends and Distributions.

     (a) Subject to the prior and superior rights of the holders of shares of any other series of
Preferred Stock or other class of stock of the Corporation ranking prior and superior to the Series
A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock
shall be entitled to receive, when, as and if declared by the Board of Directors, out of the assets
of the Corporation legally available therefor, (i) quarterly dividends payable in cash on the last
day of each fiscal quarter in each year, or such other dates as the Board of Directors of the
Corporation shall approve (each such date being referred to herein as a “Quarterly Dividend Payment
Date”), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share
or a fraction of a share of Series A Preferred Stock, in the amount of $.01 per whole share
(rounded to the nearest cent) less the amount of all cash dividends declared on the Series A
Preferred Stock pursuant to the following clause (ii) since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the
first issuance of any share or fraction of a share of Series A Preferred Stock (the total of which
shall not, in any event, be less than zero) and (ii) dividends payable in cash on the payment date
for each cash dividend declared on the Common Stock in an amount per whole share (rounded to the
nearest cent) equal to the Formula Number (as hereinafter defined) then in effect multiplied times
the cash dividends then to be paid on each share of Common Stock. In addition, if the Corporation
shall pay any dividend or make any distribution on the Common Stock payable in assets, securities
or other forms of noncash consideration (other than dividends or distributions solely in shares of
Common Stock), then, in each such case, the Corporation shall simultaneously pay or make on each
outstanding whole share of Series A Preferred Stock a dividend or distribution in like kind equal
to the Formula Number then in effect multiplied times such dividend or distribution on each share
of the Common Stock. As used herein, the “Formula Number” shall be 1,000; provided, however, that,
if at

A-1

 

any time after May 19, 2009, the Corporation shall (x) declare or pay any dividend on the
Common Stock payable in shares of Common Stock or make any distribution on the Common Stock in
shares of Common Stock, (y) subdivide (by a stock split or otherwise) the outstanding shares of
Common Stock into a larger number of shares of Common Stock or (z) combine (by a reverse stock
split or otherwise) the outstanding shares of Common Stock into a smaller number of shares of
Common Stock, then in each such event the Formula Number shall be adjusted to a number determined
by multiplying the Formula Number in effect immediately prior to such event by a fraction, the
numerator of which is the number of shares of Common Stock that are outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock that are
outstanding immediately prior to such event (and rounding the result to the nearest whole number);
and provided further, that, if at any time after May 19, 2009, the Corporation shall issue any
shares of its stock in a merger, reclassification, or change of the outstanding shares of Common
Stock, then in each such event the Formula Number shall be appropriately adjusted to reflect such
merger, reclassification or change so that each share of Series A Preferred Stock continues to be
the economic equivalent of a Formula Number of shares of Common Stock prior to such merger,
reclassification or change.

     (b) The Corporation shall declare a dividend or distribution on the Series A Preferred
Stock as provided in paragraph (a) of this Section immediately prior to or at the same time
it declares a dividend or distribution on the Common Stock (other than a dividend or distribution
solely in shares of Common Stock); provided, however, that, in the event no dividend or
distribution (other than a dividend or distribution solely in shares of Common Stock) shall have
been declared on the Common Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend of $.01 per share on the
Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date. The Board of Directors may fix a record date for the determination of holders of
shares of Series A Preferred Stock entitled to receive a dividend or distribution declared
thereon, which record date shall be not more than 60 days prior to the date fixed for the payment
thereof.

     (c) Dividends shall begin to accrue and be cumulative on outstanding shares of Series
A Preferred Stock from and after the Quarterly Dividend Payment Date next preceding the date
of original issue of such shares of Series A Preferred Stock; provided, however, that dividends
on such shares which are originally issued after the record date for the determination of holders
of shares of Series A Preferred Stock entitled to receive a quarterly dividend and on or prior to
the next succeeding Quarterly Dividend Payment Date shall begin to accrue and be cumulative from
and after such Quarterly Dividend Payment Date. Notwithstanding the foregoing, dividends on
shares of Series A Preferred Stock which are originally issued prior to the record date for the
determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly
dividend on the first Quarterly Dividend Payment Date shall be calculated as if cumulative from
and after the last day of the fiscal quarter next preceding the date of original issuance of such
shares. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of
Series A Preferred Stock in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among
all such shares at the time outstanding.

     (d) So long as any shares of the Series A Preferred Stock are outstanding, no dividends or
other distributions shall be declared, paid or distributed, or set aside for payment or
distribution, on the Common Stock unless, in each case, the dividend required by this Section 2
to be declared on the Series A Preferred Stock shall have been declared.

A-2

 

     (e) The holders of the shares of Series A Preferred Stock shall not be entitled to receive
any dividends or other distributions except as provided herein.

     Section 3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the
following voting rights:

     (a) Each holder of Series A Preferred Stock shall be entitled to a number of votes equal to
the Formula Number then in effect, for each share of Series A Preferred Stock held of record on
each matter on which holders of the Common Stock or stockholders generally are entitled to vote,
multiplied times the maximum number of votes per share which any holder of the Common Stock or
stockholders generally then have with respect to such matter (assuming any holding period or other
requirement to vote a greater number of shares is satisfied).

     (b) Except as otherwise provided herein or by applicable law, the holders of shares of Series
A Preferred Stock and the holders of shares of Common Stock shall vote together as one class for
the election of directors of the Corporation and on all other matters submitted to a vote of
stockholders of the Corporation.

     (c) If, at the time of any annual meeting of stockholders for the election of directors,
the equivalent of six quarterly dividends (whether or not consecutive) payable on any share
or shares of Series A Preferred Stock are in default, the number of directors constituting the
Board of Directors of the Corporation shall be increased by two. In addition to voting together
with the holders of Common Stock for the election of other directors of the Corporation, the
holders of record of the Series A Preferred Stock, voting separately as a class to the exclusion
of the holders of Common Stock, shall be entitled at said meeting of stockholders (and at any
subsequent annual meeting of stockholders), unless all dividends in arrears have been paid or
declared and set apart for payment prior thereto, to vote for the election of two directors of
the Corporation, the holders of any Series A Preferred Stock being entitled to cast a number of
votes per share of Series A Preferred Stock equal to the Formula Number. Until the default in
payments of all dividends which permitted the election of said directors shall cease to exist,
any director who shall have been so elected pursuant to the next preceding sentence may be
removed at any time, either with or without cause, only by the affirmative vote of the holders of
the shares of Series A Preferred Stock at the time entitled to cast a majority of the votes
entitled to be cast for the election of any such director at a special meeting of such holders
called for that purpose, and any vacancy thereby created may be filled by the vote of such
holders. If and when such default shall cease to exist, the holders of the Series A Preferred
Stock shall be divested of the foregoing special voting rights, subject to revesting in the event
of each and every subsequent like default in payments of dividends. Upon the termination of the
foregoing special voting rights, the terms of office of all persons who have been elected
directors pursuant to said special voting rights shall forthwith terminate, and the number of
directors constituting the Board of Directors shall be reduced by two. The voting rights granted
by this Section 3(c) shall be in addition to any other voting rights granted to the holders of
the Series A Preferred Stock in this Section 3.

     (d) Except as provided in this Section 3, in Section 11 or by applicable law, holders
of Series A Preferred Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of Common Stock as set forth
herein) for authorizing or taking any corporate action.

A-3

 

     Section 4. Certain Restrictions.

     (a) Whenever quarterly dividends or other dividends or distributions payable on the Series
A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred
Stock outstanding shall have been paid in full, the Corporation shall not:

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

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

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

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

     (b) The Corporation shall not permit any subsidiary of the Corporation to purchase or
otherwise acquire for consideration any shares of stock of the Corporation unless the
Corporation could, under paragraph (a) of this Section 4, purchase or otherwise acquire such
 shares at such time and in such manner.

     Section 5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise
acquired by the Corporation in any manner whatsoever shall be retired and cancelled upon the
acquisition thereof in accordance with the CBCA. All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock, without designation as to series, and
may thereafter be issued as part of a new series of Preferred Stock subject to the conditions and
restrictions on issuance set forth herein, in the Certificate of Incorporation, or in any other
Certificate of Designations creating a series of Preferred Stock or any similar stock of the
Corporation or as otherwise required by law.

A-4

 

     Section 6. Liquidation, Dissolution or Winding Up. Upon the liquidation, dissolution or
winding up of the Corporation, whether voluntary or involuntary, no distribution shall be made (i)
to the holders of shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of
shares of Series A Preferred Stock shall have received an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of such payment, plus an
amount equal to the greater of (x) $1.00 per whole share and (y) an aggregate amount per share
equal to the Formula Number then in effect multiplied times the aggregate amount to be distributed
per share to holders of Common Stock, or (ii) to the holders of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock,
except distributions made ratably on the Series A Preferred Stock and all such parity stock in
proportion to the total amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up.

     Section 7. Consolidation, Merger, etc. In case the Corporation shall enter into any
consolidation, merger, combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash or any other property, or any
combination thereof, then in any such case the then outstanding shares of Series A Preferred Stock
shall at the same time be similarly exchanged for or changed into an amount per share equal to the
Formula Number then in effect multiplied times the aggregate amount of stock, securities, cash or
any other property (payable in kind), as the case may be, into which or for which each share of
Common Stock is exchanged or changed. In the event both this Section 7 and Section 2 appear to
apply to a transaction, this Section 7 shall control.

     Section 8. No Redemption; No Sinking Fund.

     (a) The shares of Series A Preferred Stock shall not be subject to redemption by the
Corporation; provided, however, that the Corporation may purchase or otherwise acquire
outstanding shares of Series A Preferred Stock in the open market or by offer to any holder or
holders of shares of Series A Preferred Stock.

     (b) The
shares of Series A Preferred Stock shall not be subject to or entitled to the
operation of a retirement or sinking fund.

     Section 9. Ranking. The Series A Preferred Stock shall rank, with respect to the payment of
dividends and as to distributions of assets upon liquidation, dissolution or winding up of the
Corporation, junior to all other series of Preferred Stock of the Corporation, unless the Board of
Directors shall specifically determine otherwise in fixing the powers, preferences and relative,
participating, optional and other special rights of the shares of any such other series and the
qualifications, limitations and restrictions thereof.

     Section 10. Fractional Shares. The Series A Preferred Stock shall be issuable upon exercise
of the Rights issued pursuant to the Rights Agreement in whole shares or in any fraction of a
share that is one one-thousandth of a share or any integral multiple of such fraction which shall
entitle the holder, in proportion to such holder’s fractional shares, to receive dividends,
exercise voting rights, participate in distributions and to have the benefit of all other rights
of holders of Series A Preferred Stock. In lieu of fractional shares, the Corporation, prior to
the first issuance of a share or a fraction of a share of Series A Preferred Stock, may elect (i)
to make a cash payment as provided in the Rights Agreement for fractions of a share other than one
one-thousandth of a share or any integral multiple thereof or (ii) to issue depository receipts
evidencing such authorized fraction of a share of

A-5

 

Series A Preferred Stock pursuant to an appropriate agreement between the Corporation and a
depository selected by the Corporation; provided that such agreement shall provide that the
holders of such depository receipts shall have all the rights, privileges and preferences to which
they are entitled as holders of the Series A Preferred Stock.

     Section 11. Amendment. None of the powers, preferences or relative, participating, optional
or other special rights of the Series A Preferred Stock as provided herein or in the Articles of
Incorporation shall be amended in any manner that would alter or change the powers, preferences,
rights or privileges of the holders of Series A Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of at least 66-2/3 percent of the outstanding shares
of Series A Preferred Stock, voting as a separate class.

A-6

 

EXHIBIT B

[Form of Right Certificate]

			
	 	 	 
	Certificate No. R-
	 	                     Rights

NOT EXERCISABLE AFTER MAY 19, 2019, OR EARLIER IF REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT
TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.01 PER RIGHT ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF
AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND BY ANY SUBSEQUENT
HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND NONTRANSFERABLE.

Right Certificate

ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

     This certifies that                                          , or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Amended and Restated Rights
Agreement, dated as of May 19, 2009 (the “Rights Agreement”), between Rocky Mountain Chocolate
Factory, Inc., a Colorado corporation (the “Company”), and COMPUTERSHARE TRUST COMPANY, N.A., as
Rights Agent (the “Rights Agent”), unless the Rights evidenced hereby have been previously
redeemed by the Company, to purchase from the Company at any time after the Distribution Date (as
defined in the Rights Agreement) and prior to 5:00 P.M., New York City time, on May 19, 2019 (the
“Final Expiration Date”), at the principal office or agency of the Rights Agent, or its
successors as Rights Agent, in the City of New York, one one-hundredth of a fully paid,
nonassessable share of Series A Junior Participating Preferred Stock, par value $0.10 per share,
of the Company (the “Preferred Shares”), at a purchase price per one one-hundredth of a share
equal to $30.00 (the “Purchase Price”), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase duly executed.

     The Purchase Price and the number and kind of shares that may be purchased upon exercise of
each Right evidenced by this Right Certificate, as set forth above, are the Purchase Price and
the number and kind of shares that may be purchased as of,
                    ,
20___. As provided in the
Rights Agreement, the Purchase Price and the number and kind of shares that may be purchased upon
the exercise of each Right evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events.

     This Right Certificate is subject to all 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 reference to the Rights Agreement is hereby made for a full
description of the rights, limitations of rights, obligations, duties and immunities hereunder of
the Rights

B-1

 

Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement
are on file at the above-mentioned office and agency of the Rights Agent and are also available
from the Company upon request.

     If the Rights evidenced by this Right Certificate are at any time beneficially owned by an
Acquiring Person or an Associate or Affiliate of an Acquiring Person (as such terms are defined
in the Rights Agreement), such Rights shall be null and void and nontransferable and the holder
of any such Right (including any purported transferee or subsequent holder) shall not have any
right to exercise or transfer any such Right.

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

     Subject to the provisions of the Rights Agreement, the Rights evidenced by this Right
Certificate may be redeemed by the Company at its option at a redemption price (in cash or shares
of Common Stock or other securities of the Company deemed by the Board of Directors of the Company
to be at least equivalent in value) of $.01 per Right (which amount may be subject to adjustment
as provided in the Rights Agreement) at any time prior to the earlier of (i) the close of business
on the tenth day following the first date of public announcement by the Company or an Acquiring
Person that an Acquiring Person has become such and (ii) the Final Expiration Date.

     The Company may, but shall not be required to, issue fractions of a Preferred Share (other
than one one-hundredth of a Preferred Share or any integral multiple thereof) or distribute
certificates which evidence fractions of a Preferred Share upon the exercise of any Right or
Rights evidenced hereby. In lieu of issuing fractional shares, the Company may elect to make a
cash payment as provided in the Rights Agreement for fractions of a share other than one
one-hundredth of a share or any integral multiple thereof or to issue certificates or utilize a
depository arrangement as provided in the terms of the Rights Agreement and the Preferred Shares.

     No holder of this Right Certificate, as such, shall be entitled to vote or receive dividends
or be deemed, for any purpose, the holder of the Preferred Shares or any other securities of the
Company which may at any time be issuable on the exercise hereof, nor shall anything contained in
the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company, including, without limitation, any right to vote for the
election of directors or upon any other 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 other distributions or subscription rights, or otherwise, until the Right or Rights
evidenced by this Right Certificate shall have been exercised as provided in accordance with the
provisions of the Rights Agreement.

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

B-2

 

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

     Dated as of:

	 	 	 	 	 	 	 
	[CORPORATE SEAL]	 	 	 	 
	 
	 	 	 	 	 	 
	ATTEST:	 	ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.
	 
	 	 	 	 	 	 
	By

	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 
	  Name:

	 	 	 	Name:	 	 
	  Title:

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	Countersigned:	 	 	 	 
	 
	 	 	 	 	 	 
	COMPUTERSHARE TRUST COMPANY,
N.A.	 	 	 	 
	 
	 	 	 	 	 	 
	By
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Authorized Signature	 	 	 	 

B-3

 

[On Reverse Side of Right Certificate]

FORM OF ASSIGNMENT

(To be executed by the registered holder if such

holder desires to transfer the Right Certificate.)

     FOR VALUE RECEIVED                                                                                                                                                                                      hereby
sells, assigns and transfers unto                                                          
                                                                                                        

(Please print name and address of transferee)

 

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

Dated:                                         

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Signature Guaranteed:

     Signatures must be guaranteed by a participant in a Securities Transfer Association
recognized signature program.

Certification of Status

     The undersigned hereby certifies by checking the appropriate boxes that:

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

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

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Dated:                                         

B-4

 

[On Reverse Side of Right Certificate — continued]

FORM OF ELECTION TO PURCHASE

(To be executed by the registered holder if such holder desires

to exercise the Rights represented by the Right Certificate.)

To: ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.

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

	 	 	 
	Please insert social security

	 	 
	or other identifying number
	 	 
	 

	 	 

 

(Please print name and address)

 

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

	 	 	 
	Please insert social security
	 	 
	or other identifying number
	 	 
	 

	 	 

      

(Please print name and address)

 

Dated:                                         

	 	 	 	 	 
	 

	 	 

Signature
	 	 

B-5

 

[On Reverse Side of Right Certificate — continued]

Signature Guaranteed:

     Signatures must be guaranteed by a participant in a Securities Transfer Association
recognized signature program.

Certification of Status

     The undersigned hereby certifies by checking the appropriate boxes that:

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

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

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Dated:                                         

NOTICE

     The signature in the Form of Assignment or Form of Election to Purchase, as the case may be,
must conform to the name as written upon the face of this Right Certificate in every particular,
without alteration or enlargement or any change whatsoever.

     In the event the Certification of Status set forth above in the Form of Assignment or the
Form of Election to Purchase, as the case may be, is not completed, the Company and the Rights
Agent will deem the beneficial owner of the Rights evidenced by this Right Certificate to be an
Acquiring Person or an Affiliate or Associate thereof (as such terms are defined in the Rights
Agreement) and such Assignment or Election to Purchase will not be honored.

B-6

 

EXHIBIT C

SUMMARY OF RIGHTS TO PURCHASE

PREFERRED SHARES

     On May 19, 2009, the Board of Directors of Rocky Mountain Chocolate Factory, Inc.

(the “Company”) authorized and declared a dividend of one Right (a “Right”) for each outstanding
share of Common Stock, par value $0.03 per share (“Common Stock”), of the Company (the “Common
Shares”). The dividend is payable on May 19, 2009 (the “Record Date”) to the holders of record of
the Common Shares at the close of business on that date. In addition, the Company has authorized
the issuance of one Right with respect to each share of Common Stock that shall become
outstanding between the Record Date and the earliest of the Distribution Date, the Redemption
Date and the Final Expiration Date (as such terms are hereinafter defined). When exercisable each
Right entitles the registered holder to purchase from the Company one one-thousandth of a share
of Series A Junior Participating Preferred Stock, par value $0.10 per share, of the Company (the
“Preferred Shares”), at a price of $30 per one one-thousandth of a Preferred Share (the “Purchase
Price”), subject to adjustment. The description and terms of the Rights are set forth in a n
Amended and Restated Rights Agreement (the “Rights Agreement”) between the Company and
Computershare Trust Company, N.A., as Rights Agent (the “Rights Agent”).

     Until the earlier to occur of (i) 10 days following a public announcement that a person or
group of affiliated or associated persons (an “Acquiring Person”) has acquired beneficial
ownership of 15 percent or more of the outstanding Common Shares and (ii) 10 business days (or
such later date as may be determined by action of the Board of Directors of the Company prior to
such time as any person or group of affiliated or associated persons becomes an Acquiring Person)
following the commencement of, or first public announcement of an intention to commence, a tender
offer or exchange offer the consummation of which would result in the beneficial ownership by a
person or group of affiliated or associated persons of 15 percent or more of the outstanding
Common Shares (the earlier of such dates being herein referred to as the “Distribution Date”),
the Rights will be evidenced, with respect to any of the Common Share certificates outstanding as
of the Record Date, by such Common Share certificate with a copy of this Summary of Rights
attached thereto. No person who is the beneficial owner of 15 percent or more of the Common
Shares of the Company on the date of the Rights Agreement shall be deemed to be an Acquiring
Person unless and until such person becomes the beneficial owner of any additional Common Shares
of the Company and, immediately after the acquisition of such additional shares, is the
beneficial owner of 15 percent or more of the Common Shares of the Company.

     The Rights Agreement provides that, until the Distribution Date (or earlier redemption or
expiration of the Rights), the Rights will be transferred with and only with the Common Shares.
Until the Distribution Date (or earlier redemption or expiration of the Rights), new Common Share
certificates issued after the Record Date, upon transfer or new issuance of Common Shares, will
contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the surrender for transfer of any
certificates for Common Shares outstanding on or after the Record Date, even without such notation
or a copy of this Summary of Rights being attached thereto, will also constitute the transfer of
the Rights associated with the Common Shares represented by such certificate. As soon as
practicable following the Distribution Date, separate certificates evidencing the Rights (“Right
Certificates”) will be mailed to holders of record of the Common Shares as of the close of
business on the Distribution Date and such separate Right Certificates alone will evidence the
Rights.

C-1

 

     The Rights are not exercisable until the Distribution Date. The Rights will expire on May
19, 2019 (the “Final Expiration Date”), unless the Final Expiration Date is extended or unless
the Rights are earlier redeemed or exchanged by the Company, in each case, as described below.

     The Purchase Price payable, and the number of Preferred Shares or other securities or
property issuable, upon exercise of the Rights are subject to adjustment from time to time to
prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Shares, (ii) upon the grant to holders of the Preferred Shares
of certain rights or warrants to subscribe for or purchase Preferred Shares at a price, or
securities convertible into Preferred Shares with a conversion price, less than the then current
market price of the Preferred Shares or (iii) upon the distribution to holders of the Preferred
Shares of evidences of indebtedness or assets (excluding regular periodic cash dividends paid out
of earnings or retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).

     The number of outstanding Rights and the number of one one-thousandth of a Preferred Share
issuable upon exercise of each Right are also subject to adjustment in the event of a stock split
of the Common Shares or a stock dividend on the Common Shares payable in Common Shares or
subdivisions, consolidations or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.

     Preferred Shares purchasable upon exercise of the Rights will not be subject to redemption by
the Company. Each Preferred Share will be entitled to a minimum preferential quarterly dividend
payment of $.01 per share but will be entitled to an aggregate dividend of 1,000 multiplied times
the dividend declared per Common Share. In the event of liquidation, the holder of the Preferred
Shares will be entitled to a minimum preferential liquidation payment of $1.00 per share but will
be entitled to an aggregate payment of 1,000 multiplied times the payment made per Common Share.
Each Preferred Share will have 1,000 votes, voting together with the Common Shares. Finally, in
the event of any merger, consolidation or other transaction in which Common Shares are exchanged,
each Preferred Share will be entitled to receive 1,000 multiplied times the amount received per
Common Share. These rights are protected by customary antidilution provisions.

     Because of the nature of the Preferred Shares’ dividend, liquidation and voting rights, the
value of the one one-hundredth interest in a Preferred Share purchasable upon exercise of each
Right should approximate the value of one Common Share.

     In the event that any person or group of affiliated or associated persons becomes an
Acquiring Person, proper provision shall be made so that each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereafter be null and void and
nontransferable), will thereafter have the right to receive upon exercise that number of Common
Shares of the Company having a market value of two times the exercise price of the Right. In the
event that the Company is acquired in a merger or other business combination transaction or 50
percent or more of its consolidated assets or earning power are sold after a person or group of
affiliated or associated persons has become an Acquiring Person, proper provision will be made so
that each holder of a Right will thereafter have the right to receive, upon the exercise thereof
at the then current exercise price of the Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have a market value of two times the
exercise price of the Right.

C-2

 

     At any time after any person or group of affiliated or associated persons becomes an
Acquiring Person and prior to the acquisition by such person or group of 50 percent or more of the
outstanding Common Shares, the Board of Directors of the Company may exchange the Rights (other
than Rights owned by such person or group which will have become null and void and
nontransferable), in whole or in part, at an exchange ratio of one Common Share, or one
one-hundredth of a Preferred Share (or of a share of a class or series of the Company’s preferred
stock having equivalent rights, preferences and privileges), per Right (subject to adjustment).

     With certain exceptions, no adjustment in the Purchase Price will be required until
cumulative adjustments require an adjustment of at least one percent in such Purchase Price. The
Company may, but shall not be required to, issue fractions of a Preferred Share (other than one
one-hundredth of a Preferred Share or any integral multiple thereof, which may, at the election
of the Company, be evidenced by depositary receipts) and in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Shares on the last trading day prior to
the date of exercise.

     At any time prior to the close of business on the tenth day following a public announcement
that an Acquiring Person has become such an Acquiring Person, the Board of Directors of the
Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right (the
“Redemption Price”). The redemption of the Rights may be made effective at such time, on such
basis and with such conditions as the Board of Directors in its sole discretion may establish.
The time at which the Rights are redeemed by the Company is herein referred to as the
''Redemption Date.” Immediately upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right thereafter of the holders of Rights will be to receive
the Redemption Price.

     At any time prior to the Distribution Date and subject to the last sentence of this
paragraph, the terms of the Rights may be amended by the Board of Directors of the Company
without the consent of the holders of the Rights, including without limitation an amendment to
lower certain thresholds described above to not less than the greater of (i) the sum of 0.001
percent and the largest percentage of the outstanding Common Shares then known by the Company to
be beneficially owned by any person or group of affiliated or associated persons and (ii) 10
percent. From and after the Distribution Date and subject to applicable law, the terms of the
Rights may be amended by the Board of Directors of the Company without the consent of the holders
of the Rights to, among other things, make any other provisions in regard to matters under the
Rights Agreement that the Company may deem necessary or desirable and that shall not adversely
affect the interests of the holders of the Rights (other than an Acquiring Person or an affiliate
or associate of an Acquiring Person). The terms of the Rights may not be amended to (i) reduce
the Redemption Price (except as required by antidilution provisions) or (ii) provide for an
earlier Final Expiration Date.

     Until a Right is exercised, the holder thereof, as such, will have no rights as a
stockholder of the Company, including, without limitation, the right to vote or to receive
dividends.

     The Preferred Shares shall rank, with respect to the payment of dividends and as to
distributions of assets upon liquidation, dissolution or winding up of the Company, junior to all
other series of preferred stock of the Company, unless the Board of Directors of the Company
shall specifically determine otherwise in fixing the powers, preferences and relative,
participating, optional and other special rights of the shares of any such other series and the
qualifications, limitations and restrictions thereof.

C-3

 

     A copy of the Rights Agreement has been filed with the Securities and Exchange Commission as
an Exhibit to a Registration Statement on Form 8-A/A dated May 19, 2009. A copy of the Rights
Agreement is available free of charge from the Company. This summary description of the Rights
does not purport to be complete and is qualified in its entirety by reference to the Rights
Agreement, which is hereby incorporated herein by reference.

C-4

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