Document:

ex_4-1.htm

    EXHIBIT
4.1

      

      
        

      

      
        

      

    

     

    

    SERIES A
WARRANT AGREEMENT

    (Series A
Warrants)

     

    by and
between

b

    CALPINE
CORPORATION,

     

    Computershare
Inc.

b

    and

     

    Computershare
Trust Company, N.A.

     

    as
Warrant Agent

     

     

      
        

      

    

    

    

    
      

    

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    SERIES
A WARRANT AGREEMENT

     

    TABLE OF CONTENTS1

     

    

    
      	
              SECTION
      1.

            	
              Appointment
      of Warrant Agent

            	
              1

            
	
              SECTION
      2.

            	
              Issuance
      of Warrants

            	
              1

            
	
              SECTION
      3.

            	
              Warrant
      Certificates

            	
              2

            
	
              SECTION
      4.

            	
              Execution
      of Warrant Certificates

            	
              2

            
	
              SECTION
      5.

            	
              Registration
      and Countersignature

            	
              3

            
	
              SECTION
      6.

            	
              Registration
      of Transfers and Exchanges

            	
              3

            
	
              SECTION
      7.

            	
              Acknowledgment;
      Securities Law Compliance

            	
              6

            
	
              SECTION
      8.

            	
              Terms
      of Warrants; Exercise of Warrants

            	
              6

            
	
              SECTION
      9.

            	
              Payment
      of Taxes

            	
              10

            
	
              SECTION
      10.

            	
              Mutilated
      or Missing Warrant Certificates

            	
              10

            
	
              SECTION
      11.

            	
              Reservation
      of Shares of Common Stock

            	
              10

            
	
              SECTION
      12.

            	
              Adjustment
      of Exercise Price and Number of Shares of Common Stock
      Issuable

            	
              11

            
	
              SECTION
      13.

            	
              Priority
      Adjustments, Further Actions

            	
              16

            
	
              SECTION
      14.

            	
              Fractional
      Interests

            	
              17

            
	
              SECTION
      15.

            	
              Warrant
      Holders not Stockholders

            	
              17

            
	
              SECTION
      16.

            	
              Merger,
      Consolidation or Change of Name of Warrant Agent

            	
              17

            
	
              SECTION
      17.

            	
              Warrant
      Agent

            	
              18

            
	
              SECTION
      18.

            	
              Expenses

            	
              21

            
	
              SECTION
      19.

            	
              Change
      of Warrant Agent

            	
              21

            
	
              SECTION
      20.

            	
              Notices
      to the Company and Warrant Agent

            	
              22

            
	
              SECTION
      21.

            	
              Supplements
      and Amendments

            	
              22

            

    

    

      

    

    
      1 This
Table of Contents does not constitute a part of this Warrant Agreement or have
any bearing upon the interpretation of any of its terms or
provisions

    

     

     

    

    
      
        
           

        

        
          i

          
            

          

        

        
           

        

      

    

    

    

    
      	
              SECTION
      22.

            	
              Successors

            	
              23

            
	
              SECTION
      23.

            	
              Termination

            	
              23

            
	
              SECTION
      24.

            	
              Governing
      Law; Jurisdiction

            	
              23

            
	
              SECTION
      25.

            	
              Benefits
      of this Warrant Agreement

            	
              24

            
	
              SECTION
      26.

            	
              Counterparts

            	
              24

            
	
              SECTION
      27.

            	
              Further
      Assurances

            	
              24

            
	
              SECTION
      28.

            	
              Entire
      Agreement

            	
              24

            
	
              Exhibit
      A – Form of Definitive Warrant Certificate

            	
              A-1

            
	
              Exhibit
      B – Form of Global Warrant Certificate

            	
              B-1

            

    

    

    

     

    

    
      
        
           

        

        
          ii

          
            

          

        

        
           

        

      

    

    

    SERIES A WARRANT
AGREEMENT (this “Warrant
Agreement”), entered into on February 15, 2008, between CALPINE
CORPORATION, a Delaware corporation (the “Company”),
Computershare Inc (“Computershare”), and its wholly-owned Subsidiary,
Computershare Trust Company, N.A. as Warrant Agent (the “Trust
Company” and together with Computershare the “Warrant
Agent”).

     

    WHEREAS,
pursuant to the terms and conditions of the Sixth Amended Joint Plan of
Reorganization, dated December 19, 2007, as the same may be amended, modified or
restated from time to time (the “Plan”)
relating to the reorganization under Chapter 11 of the Bankruptcy Reform Act of
1978, as codified in Title 11 of the United States Code, 11
U.S.C.  §§101-1330 (the “Bankruptcy
Code”) of Calpine Corporation and certain of its direct and indirect
subsidiaries, the holders of certain Interests (as defined in the Plan) are to
be issued Series A Warrants (the “Warrants”)
exercisable until the Expiration Date (as defined below), to purchase up to
48,500,000 shares of Common Stock, par value $0.001 per share, of the Company
(“Original
Common Stock”) at an exercise price of $23.88 per share of Common Stock,
as adjusted pursuant to Section
12 hereof (the “Exercise
Price”);

     

    WHEREAS, the
Warrants are being issued pursuant to, and upon the terms and conditions set
forth in, the Plan in an offering in reliance on the exemption afforded by
section 1145 of the Bankruptcy Code from the registration requirements of
the Securities Act of 1933, as amended (the “Securities
Act”), and of any applicable state securities or “blue sky”
laws;

     

    WHEREAS, the
Company desires the Warrant Agent to act on behalf of the Company, and the
Warrant Agent is willing so to act, in connection with the issuance of Warrant
certificates and other matters as provided herein; and

     

    WHEREAS, for
purposes of this Warrant Agreement, “person” shall be interpreted broadly to
include an individual, corporation, partnership, joint venture, association,
joint stock company, limited liability company, limited liability partnership,
national banking association, trust, trustee, estate, unincorporated
organization, government, governmental unit, agency, or political subdivision
thereof, or other entity.

     

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

     

    SECTION
1. Appointment
of Warrant Agent.  The Company hereby appoints the Warrant
Agent to act as warrant agent for the Company in accordance with the express
(and no implied) instructions set forth hereinafter in this Warrant Agreement,
and the Warrant Agent hereby accepts such appointment.

     

    SECTION
2. Issuance of
Warrants.  In accordance with Section 5,
the Company will cause to be issued one or more Definitive Warrant Certificates
(as defined below) and, if applicable, one or more Global Warrant Certificates
(as defined below) evidencing the Warrants in accordance with the terms of this
Warrant Agreement and the Plan.  Each Warrant Certificate shall
evidence one or more Warrants.  Each Warrant evidenced thereby
entitles the holder, upon proper exercise and payment of the applicable Exercise
Price, to receive

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    from the
Company, as adjusted as provided herein, one share of Common Stock at the
Exercise Price.  The shares of Common Stock or (as provided pursuant
to Section
12) other shares of capital stock deliverable upon proper exercise of the
Warrants are referred to herein as the “Warrant
Shares.”  The words “holders”
or “holder,”
as used herein in respect of any Warrants or Warrant Shares, shall mean the
registered holder or registered holders thereof.

     

    SECTION
3. Warrant
Certificates.  Subject to Section
6 of this Warrant Agreement, the Warrants shall be issued (1) in the form
of one or more warrant certificates in definitive form (the “Definitive
Warrant Certificates”) in substantially in the form set forth in Exhibit
A hereto, the forms of election to exercise and of assignment to be printed on
the reverse thereof, and (2) if applicable, in the form of one or more global
certificates (the “Global
Warrant Certificates” substantially the form set forth in Exhibit B
hereto, the forms of election to exercise and of assignment to be printed on the
reverse thereof and, together with the Definitive Warrant Certificates, the
“Warrant
Certificates”), , in each case together with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Warrant Agreement, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with any law or with any rules made pursuant thereto or with
any rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Warrant Certificates, as evidenced by
their execution of the Warrant Certificates.

     

    The
Global Warrant Certificates, if issued, shall be deposited on or after the date
hereof with, or with the Warrant Agent as custodian for, The Depositary Trust
Company (the “Depositary”) and registered in the name of Cede & Co., as the
Depositary’s nominee.  Each Global Warrant Certificate shall represent
such number of the outstanding Warrants as specified therein, and each shall
provide that it shall represent the aggregate amount of outstanding Warrants
from time to time endorsed thereon and that the aggregate amount of outstanding
Warrants represented thereby may from time to time be reduced or increased, as
appropriate, in accordance with the terms of this Warrant
Agreement.

     

    Upon
request, a holder may receive from the Depositary and the Warrant Agent Warrants
in the form of Definitive Warrant Certificates as set forth in Section
6 below.

     

    SECTION
4. Execution
of Warrant Certificates.  Warrant Certificates shall be signed
on behalf of the Company by the Chairman of the Board or its Chief Executive
Officer or any Vice President, and by the Secretary or any Assistant
Secretary.  Each such signature upon any Warrant Certificate may be in
the form of a facsimile signature of the present or any future Chairman of the
Board, Chief Executive Officer, Vice President, Secretary or Assistant Secretary
and may be imprinted or otherwise reproduced on the Warrant Certificates and for
that purpose the Company may adopt and use the facsimile signature of any person
who shall have been Chairman of the Board, Chief Executive Officer, Vice
President, Secretary or Assistant Secretary at the time of entering into this
Warrant Agreement, notwithstanding the fact that at the time any Warrant
Certificate shall be countersigned by the Warrant Agent and delivered or
disposed of by the Company he or she shall have ceased to hold such office, so
long as, and the Company hereby represents that, under the Company’s certificate
of incorporation and bylaws, as each may be amended and in effect from time to
time, any Warrants or shares of Common Stock so issued would be validly
issued.

     

    

    
      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

    

    Warrant
Certificates shall be dated the date of countersignature by the Warrant Agent
and shall represent one or more whole Warrants.

     

    SECTION
5. Registration
and Countersignature.  The Warrant Agent, on behalf of the
Company, shall number and register the Warrant Certificates in a Warrant
register as they are issued by the Company.  The Warrant register will
show the names and addresses of the respective holders of the Warrants, the
numbers of Warrants evidenced on the face of each Warrant Certificate and the
date of each Warrant Certificate.

     

    Warrant
Certificates shall be manually countersigned by the Warrant Agent and shall not
be valid for any purpose unless so countersigned.  The Warrant Agent
shall, upon written instructions of the Chairman of the Board, the Chief
Executive Officer, any Vice President, the Secretary or any Assistant Secretary
of the Company, initially countersign and deliver Warrants entitling the holders
thereof to purchase not more than the number of shares of Common Stock referred
to above in the first recital hereof (but subject to adjustment as hereinafter
provided) and shall countersign and deliver Warrants as otherwise provided in
this Warrant Agreement.  Each holder of Warrants, including those
holders accepting a Warrant Certificate, shall be bound by all of the terms and
provisions of the Warrant Agreement (a copy of which is available on request to
the Secretary of the Company) and any amendments thereto as fully and
effectively as if such holder had signed the same.

     

    The
Company and the Warrant Agent may deem and treat the registered holder(s) of any
Warrant Certificates as the absolute owner(s) thereof (notwithstanding any
notation of ownership or other writing thereon made by anyone), for all
purposes, and neither the Company nor the Warrant Agent shall be affected by any
notice to the contrary.

     

    SECTION
6. Registration
of Transfers and Exchanges.

     

    (a)    
Transfer
and Exchange of Global Warrant Certificates or Beneficial Interests
Therein. The transfer and exchange of Global Warrant Certificates or
beneficial interests therein shall be effected through the Depositary, in
accordance with this Warrant Agreement and the procedures of the Depositary
therefor.

     

    (b)    
Exchange of
a Beneficial Interest in a Global Warrant Certificate for a Definitive Warrant
Certificate.

     

    (i)           Any
holder of a beneficial interest in a Global Warrant Certificate may, upon
request, exchange such beneficial interest for a Definitive Warrant Certificate.
Upon receipt by the Warrant Agent from the Depositary or its nominee of written
instructions or such other form of instructions as is customary for the
Depositary on behalf of any person having a beneficial interest in a Global
Warrant Certificate, the Warrant Agent shall cause, in accordance with the
standing instructions and procedures existing between the Depositary and Warrant
Agent, the number of Warrants represented by the Global Warrant Certificate to
be reduced by the number of Warrants to be represented by the Definitive Warrant
Certificates to be issued in exchange for the interest of such person in the
Global Warrant Certificate and, following such reduction, the Company shall
execute and the Warrant Agent shall countersign and deliver to the transferee,
as the case may be, a Definitive Warrant Certificate.

     

    

    
      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

    

    (ii)           Definitive
Warrant Certificates issued in exchange for a beneficial interest in a Global
Warrant Certificate pursuant to this Section
6(b) shall be registered in such names as the Depositary, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Warrant Agent. The Warrant Agent shall deliver via 1st class mail
such Definitive Warrant Certificates to the persons in whose names such Warrant
Certificates are so registered.

     

    (c)    
Transfer
and Exchange of Definitive Warrant Certificates.  Definitive
Warrant Certificates may be exchanged at the option of the registered holder(s)
thereof, when surrendered to the Warrant Agent at the Warrant Agent Office
referred to in Section 20
(the “Warrant
Agent Office”) during normal business hours for another Definitive
Warrant Certificate or Certificates of like tenor and representing in the
aggregate a like number of Warrants.  Definitive Warrant Certificates
surrendered for exchange or for registration of transfer pursuant to clause (i)
of the last sentence of this Section
6(c) or Section
6(h)(v) hereof shall be cancelled by the Warrant Agent.  Such
cancelled Definitive Warrant Certificates shall then be disposed of by or at the
direction of the Company in accordance with applicable law.  When
Definitive Warrant Certificates are presented to the Warrant Agent with a
request:

     

    (i)           to
register the transfer of the Definitive Warrant Certificates; or

     

    (ii)           to
exchange such Definitive Warrant Certificates for an equal number of Definitive
Warrant Certificates of other authorized denominations,

     

    the
Warrant Agent shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, however, that the
Definitive Warrant Certificates presented or surrendered for registration of
transfer or exchange shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Warrant Agent, duly executed
by the holder thereof or the duly appointed legal representative thereof or by
his attorney, duly authorized in writing, and bearing an original signature
guarantee from a guarantor who participates in a signature guarantee program
approved by The Securities Transfer Association.

     

    (d)    
Restrictions
on Exchange or Transfer of a Definitive Warrant Certificate for a Beneficial
Interest in a Global Warrant Certificate.  A Definitive Warrant
Certificate may not be exchanged for a beneficial interest in a Global Warrant
Certificate unless a Global Warrant Certificate has been issued and the
requirements set forth in this Section
6(d) have been satisfied. Upon receipt by the Warrant Agent of a
Definitive Warrant Certificate, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Warrant Agent, together
with written instructions directing the Warrant Agent to make, or to direct the
Depositary to make, an endorsement on the Global Warrant Certificate to reflect
an increase in the number of Warrants represented by the Global Warrant
Certificate equal to the number of Warrants represented by such Definitive
Warrant Certificate (such instruments of transfer and instructions to be duly
executed by the holder hereof or the duly appointed legal representative thereof
or by his attorney, duly authorized in writing, such signatures to be guaranteed
by an eligible guarantor institution), then the Warrant Agent shall cancel such
Definitive Warrant Certificate and cause, or direct the Depositary to cause, in
accordance with the standing

     

     

    
      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

     

    instructions
and procedures existing between the Depositary and the Warrant Agent, the number
of Warrants represented by the Global Warrant Certificate to be increased
accordingly.

     

    (e)    
Restrictions
on Transfer and Exchange of Global Warrant
Certificates.  Notwithstanding any other provisions of this
Agreement (other than the provisions set forth in Section 6(f)), unless and
until it is exchanged in whole for Definitive Warrant Certificates, a Global
Warrant Certificate may not be transferred as a whole except by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the Depositary or any such
nominee to a successor Depositary or a nominee of such successor
Depositary.

     

    (f)    
Countersigning
of Definitive Warrant Certificates in Absence of
Depositary.  If at any time a Global Warrant Certificate has
been issued and is outstanding and:

     

    (i)           the
Depositary for the Global Warrant Certificate notifies the Company that the
Depositary is unwilling or unable to continue as Depositary for the Global
Warrant Certificate and a successor Depositary for the Global Warrant
Certificate is not appointed by the Company within 90 days after delivery of
such notice; or

     

    (ii)           the
Company, in its sole discretion, notifies the Warrant Agent in writing that it
elects to cause the issuance of Definitive Warrant Certificates under this
Warrant Agreement,

     

    then the
Company shall execute, and the Warrant Agent, upon written instructions signed
by an officer of the Company, shall countersign and deliver Definitive Warrant
Certificates, in an aggregate number equal to the number of Warrants represented
by the Global Warrant Certificates, in exchange for such Global Warrant
Certificates.

     

    (g)    
Cancellation
of Global Warrant Certificate.  At such time as all beneficial
interests in Global Warrant Certificates have either been exchanged for
Definitive Warrant Certificates, redeemed, repurchased or cancelled, all Global
Warrant Certificates shall be returned to, or cancelled and retained pursuant to
applicable law by, the Warrant Agent.

     

    (h)    
Obligations
with Respect to Transfers and Exchanges of Warrants.

     

    (i)           To
permit registrations of transfers and exchanges, the Company shall execute and
the Warrant Agent is hereby authorized to countersign, in accordance with the
provisions of Section
3 and this Section
6, Definitive Warrant Certificates and Global Warrant Certificates as
required pursuant to the provisions of this Section
6 and for the purpose of any distribution of additional Warrant
Certificates contemplated by Section
12.

     

    (ii)           All
Definitive Warrant Certificates and Global Warrant Certificates issued upon any
registration of transfer or exchange of Definitive Warrant Certificates or
Global Warrant Certificates shall be the valid obligations of the Company,
entitled to the same benefits under this Agreement as the Definitive Warrant
Certificates or Global Warrant Certificates surrendered upon such registration
of transfer or exchange.

     

     

    
      
        
           

        

        
          5

          
            

          

        

        
           

        

      

    

     

    (iii)           No
service charge shall be made to a holder of Warrants for any registration,
transfer or exchange but the Company may require payment of a sum sufficient to
cover any stamp or other tax or other governmental charge that may be imposed on
the holder in connection with any such exchange or registration of
transfer.

     

    (iv)           So
long as the Depositary, or its nominee, is the registered owner of a Global
Warrant Certificate, the Depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the Warrants represented by such Global
Warrant Certificate for all purposes under this Agreement. Except as provided in
Section
6(b) upon the exchange of a beneficial interest in a Global Warrant
Certificate for a Definitive Warrant Certificate, owners of beneficial interests
in a Global Warrant Certificate will not be entitled to have any Warrants
registered in their names, and will not receive or be entitled to receive
physical delivery of any such Warrants as Definitive Warrant Certificates and
will not be considered the owners or holders thereof under the Warrants or this
Warrant Agreement. Neither the Company nor the Warrant Agent, in its capacity as
registrar for such Warrants, will have any responsibility or liability for any
aspect of the records relating to beneficial interests in a Global Warrant
Certificate or for maintaining, supervising or reviewing any records relating to
such beneficial interests.

     

    (v)           Subject
to Sections
6(b), (c),
(d)
and this Section
6(h), the Warrant Agent shall, upon receipt of all information required
to be delivered hereunder, from time to time register the transfer of any
outstanding Warrants represented by Warrant Certificates in the Warrant
Register, upon surrender of Warrant Certificates representing such Warrants at
the Warrant Agent Office (as defined below), duly endorsed, and accompanied by a
completed form of assignment, duly signed by the holder thereof or by the duly
appointed legal representative thereof or by a duly authorized attorney, such
signature to be guaranteed by an eligible guarantor institution. Upon any such
registration of transfer, a new Warrant Certificate shall be issued to the
transferee.

     

     

    SECTION
7. Acknowledgment;
Securities Law Compliance.  Each Warrant holder, by its
acceptance of any Warrant under this Warrant Agreement, acknowledges and agrees
that the Warrants (including any Warrant Shares issued upon exercise thereof)
were issued pursuant to an exemption from the registration requirement of
Section 5 of the Securities Act provided by Section 1145 of the Bankruptcy Code,
and to the extent that a Warrant holder is an "underwriter" as defined in
Section 1145(b)(1) of the Bankruptcy Code, such holder may not be able to sell
or transfer any Warrants or Warrant Shares in the absence of an effective
registration statement under the Securities Act or an exemption from
registration thereunder, and a legend to that effect shall be placed on the
Definitive Warrant Certificates representing the Warrants and Warrant Shares
issued to any such holder.

     

     

    SECTION
8. Terms of
Warrants; Exercise of Warrants.

     

    (a)    
Subject
to the terms of this Warrant Agreement, each Warrant holder shall have the
right, which may be exercised from the date of original issuance of the Warrant
Certificates pursuant to the terms of this Warrant Agreement and prior to 5:00
p.m. New York

     

     

    
      
        
           

        

        
          6

          
            

          

        

        
           

        

      

    

     

    City
Time, on August 25, 2008 (the “Expiration
Date”), to exercise each Warrant and receive from the Company the number
of fully paid and nonassessable Warrant Shares which the holder may at the time
be entitled to receive on exercise of such Warrants and payment of the aggregate
Exercise Price then in effect for such Warrant Shares.  In addition,
prior to the delivery of any shares of Common Stock that the Company shall be
obligated to deliver upon proper exercise of the Warrants, the Company shall
comply with all applicable federal and state laws, rules and regulations which
require action to be taken by the Company.

     

    (b)    
Subject
to the adjustments set forth in Section
12, each Warrant, when exercised, will entitle the holder thereof to
purchase one share of Common Stock at the Exercise Price then in effect for such
share of Common Stock.  Each Warrant not exercised pursuant to this
Warrant Agreement prior to the Expiration Date shall become void and all rights
thereunder and all rights in respect thereof under this Warrant Agreement shall
cease as of the Expiration Date.

     

    (c)    
The
holder of Warrants may, until 5:00 p.m. New York City Time, on the Expiration
Date, exercise such holder’s right to purchase Warrant Shares
by:

     

    (i)           providing
written notice of such election (a “Warrant
Exercise Notice”) to exercise such Warrants to the Warrant Agent at the
address set forth in Section 20
hereof, “Re:  Calpine Corporation Warrant Exercise”, by
overnight courier, received by the Warrant Agent no later than 5:00 p.m. New
York City Time, on the Expiration Date, which Warrant Exercise Notice shall be
in the form of an election to purchase Warrant Shares substantially in the form
set forth either (x) in Exhibit A hereto, properly completed and executed by the
holder, provided that such written notice may only be submitted if such Warrants
are evidenced by Definitive Warrant Certificates; or (y) in Exhibit B hereto,
properly completed and executed by the holder, provided that such written notice
may only be submitted if such Warrants are evidenced by Global Warrant
Certificates held through the book-entry facilities of the Depositary, by or
through persons that are direct participants in the Depositary;

     

    (ii)           delivering,
either (x) if such Warrants are evidenced by Global Warrant Certificates, no
later than 5:00 p.m. New York City Time, on the business day immediately prior
to the Settlement Date (as defined below) such Warrants to the Warrant Agent by
book-entry transfer through the facilities of the Depositary or (y) if such
Warrants are evidenced by Definitive Warrant Certificates, no later than 5:00
p.m., New York City time, on the business day immediately prior to the
Settlement Date, the Warrant Certificates evidencing such Warrants to the
Warrant Agent; and

     

    (iii)           paying,
to Computershare, no later than 5:00 p.m., New York City time, on the Settlement
Date, the applicable Exercise Price multiplied by the number of Warrant Shares
in respect of which such Warrants are being exercised (the “Exercise
Amount”), together with any applicable taxes and governmental
charges.  The date three business days after a Warrant Exercise Notice
is delivered is referred to for all purposes under this Warrant Agreement as the
“Settlement
Date”.

     

    To the
extent a Warrant Exercise Notice is delivered in respect of Warrant prior to
5:00 p.m., New York City time, on the Expiration Date, but the deliveries and
payments specified in clause

     

     

    
      
        
           

        

        
          7

          
            

          

        

        
           

        

      

    

     

    (ii) and
(iii) above are effected thereafter but no later than 5:00 p.m., New York City
time, on the Settlement Date, the Warrants shall be nonetheless deemed exercised
prior to the Expiration Date for the purposes of this Agreement.

     

    (d)    
The
Exercise Amount shall be payable in lawful money of the United States of America
either by certified or official bank check made payable to the order of the
Company (or if agreed to in the sole and absolute discretion of the Company, by
wire transfer in immediately available funds to an account arranged with the
Company prior to exercise).

     

    (e)    
Any
exercise of a Warrant pursuant to the terms of this Warrant Agreement shall be
irrevocable and shall constitute a binding agreement between the holder and the
Company, enforceable in accordance with its terms.

     

    (f)    
The
Warrant Agent shall:

     

    (i)           examine
all Warrant Exercise Notices and all other documents delivered to it by or on
behalf of holders as contemplated by the Warrant Certificates to ascertain
whether, on their face, such Warrant Exercise Notices and any such other
documents have been executed and completed in accordance with their terms and
the terms of the Warrant Certificate;

     

    (ii)           where
a Warrant Exercise Notice or other document appears on its face to have been
improperly completed or executed or some other irregularity in connection with
the exercise of the Warrant exists, the Warrant Agent shall endeavor to inform
the appropriate parties (including the person submitting such instrument) of the
need for fulfillment of all requirements, specifying those requirements which
appear to be unfulfilled;

     

    (iii)           inform
the Company of and cooperate with and assist the Company in resolving any
reconciliation problems between the Warrant Exercise Notices received and
delivery of Warrants to the Warrant Agent’s account;

     

    (iv)
advise the Company, no later than five business days after receipt of a Warrant
Exercise Notice, of (x) the receipt of such Warrant Exercise Notice and the
number of Warrants exercised in accordance with the terms and conditions of this
Warrant Agreement, (y) the instructions with respect to delivery of the shares
of Common Stock of the Company deliverable upon such exercise, subject to the
timely receipt from the Depositary of the necessary information, and (z) such
other information as the Company shall reasonably require; and

     

    (v)           subject
to the Common Stock being made available to the Warrant Agent by or on behalf of
the Company for delivery to the Depositary, liaise with the Depositary and
endeavor to effect such delivery to the relevant accounts at the Depositary in
accordance with its requirements.

     

    (g)    
All
questions as to the validity, form and sufficiency (including time of receipt)
of a Warrant exercise shall be determined by the Company in its sole discretion,
which determination shall be final and binding.  The Warrant Agent
shall incur no liability for or in respect of and, except to the extent such
liability arises from the Warrant Agent’s gross negligence, willful misconduct
or bad faith, shall be indemnified and held harmless by The Company for acting
or refraining from acting upon, or as a result of such determination by
the

     

     

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

     

    Company.  The
Company reserves the right to reject any and all Warrant Exercise Notices not in
proper form or for which any corresponding agreement by the Company to exchange
would, in the opinion of the Company, be unlawful.  Such determination
by the Company shall be final and binding on the holders, absent manifest
error.  Moreover, the Company reserves the absolute right to waive any
of the conditions to the exercise of Warrants or defects in Warrant Exercise
Notices with regard to any particular exercise of Warrants.  The
Company shall be under no duty to give notice to the holders of the Warrants of
any irregularities in any exercise of Warrants, nor shall it incur any liability
for the failure to give such notice.

     

    (h)    
As soon
as practicable after the exercise of any Warrant, the Company shall issue, or
otherwise deliver, in authorized denominations to or upon the order of the
holder of the Warrant Certificates evidencing such Warrants,
either:

     

    (i)           if
such holder holds the Warrants being exercised through the Depositary’s
book-entry transfer facilities, by same-day or next-day credit to the Depositary
for the account of such holder or for the account of a participant in the
Depositary the number of Warrant Shares to which such holder is entitled, in
each case registered in such name and delivered to such account as directed in
the Warrant Exercise Notice by such holder or by the direct participant in the
Depositary through which such holder is acting; or

     

    (ii)           if
such holder holds the Warrants being exercised in the form of Definitive Warrant
Certificates, by delivery to the address designated by such holder in its
Warrant Exercise Notice of a physical certificate or certificates representing
the number of Warrant Shares to which such holder is entitled, in fully
registered form, registered in such name or names as may be directed by such
holder.  Such warrant shares shall be deemed to have been issued and
any person so designated to be named therein shall be deemed to have become a
holder of record of such Warrant Shares as of the close of business on the date
of the delivery thereof.  If less than all of the Warrants evidenced
by a Warrant Certificate surrendered upon the exercise of Warrants are exercised
at any time prior to the Expiration Date, a new Warrant Certificate or
Certificates shall be issued for the remaining number of Warrants evidenced by
the Warrant Certificate so surrendered, and the Warrant Agent is hereby
authorized to countersign the required new Warrant Certificate or Certificates
pursuant to the provisions of Section
5 and this Section
8.

     

    (i)    
The
Company shall use commercially reasonable efforts and take all reasonably
necessary action to have the Warrant Shares, as soon as practicable following
their issuance upon the exercise of Warrants, (i) listed on each national
securities exchange on which the Common Stock is then listed or (ii) if the
Common Stock is not then listed on any national securities exchange, listed for
quotation on the Nasdaq National Market System or such other over-the-counter
quotation system, if any, on which the Common Stock may then be
listed.

     

    (j)    
For
purposes of this Warrant Agreement, a “business
day” means any day other than a Saturday, Sunday or a day on which
banking institutions in New York City are authorized or obligated by law,
regulation or executive order to close or remain closed.  In
accordance with Section
13, no fractional shares shall be issued upon exercise of any
Warrants.

     

     

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

     

    (k)    
All
Warrant Certificates surrendered upon exercise of Warrants shall be cancelled by
the Warrant Agent.  Such cancelled Warrant Certificates shall then be
disposed of by or at the direction of the Company in accordance with applicable
law.  The Warrant Agent shall (x) advise an authorized representative
of the Company as directed by the Company by the end of each day on which
Warrants were exercised, of (i) the number of shares of Common Stock issued upon
exercise of a Warrant, (ii) the delivery of Warrant Certificates evidencing the
balance, if any, of the shares of Common Stock issuable after such exercise of
the Warrant and (iii) such other information as the Company shall reasonably
require and (y) concurrently pay to the Company all funds received by the
Warrant Agent in payment of the aggregate Exercise Price.  The Warrant
Agent promptly shall confirm such information to the Company in
writing.

     

    (l)    
The
Warrant Agent shall keep copies of this Warrant Agreement and any notices given
or received hereunder, and provide, at the Company’s expense, copies thereof to
any registered holder requesting such copy prior to the Expiration
Date.  The Company shall supply the Warrant Agent from time to time
with such numbers of copies of this Warrant Agreement as the Warrant Agent may
request.

     

    SECTION
9. Payment of
Taxes.  No service charge shall be made to any holder of a
Warrant for any exercise, exchange or registration of transfer of Warrant
Certificates, and the Company will pay all documentary stamp taxes attributable
to the initial issuance of Warrant Shares upon the exercise of Warrants; provided,
however,
that neither the Company nor the Warrant Agent shall be required to pay any tax
or taxes which may be payable in respect of any transfer involved in the issue
of any Warrant Certificates or any certificates for Warrant Shares in a name
other than that of the registered holder of a Warrant Certificate surrendered
upon the exercise of a Warrant, and the Company shall not be required to issue
or deliver such Warrant Certificates or the certificates representing the
Warrant Shares unless or until the person or persons requesting the issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been
paid.

     

                           
SECTION 10. Mutilated
or Missing Warrant Certificates.  If any of the Warrant
Certificates shall be mutilated, lost, wrongfully taken or destroyed, the
Company shall issue and the Warrant Agent shall countersign, in exchange and
substitution for and upon cancellation of the mutilated Warrant Certificate, or
in lieu of and substitution for the Warrant Certificate lost, wrongfully taken
or destroyed, a new Warrant Certificate of like date and tenor and representing
an equivalent number of Warrants, but only upon receipt of evidence satisfactory
to the Company and the Warrant Agent of such loss, wrongful taking or
destruction of such Warrant Certificate and a corporate surety bond and any
other such indemnity and security therefor as is customary and reasonably
satisfactory to the Company and the Warrant Agent and satisfaction of such other
reasonable requirements as may be imposed by the Company as permitted by Section
8-405 of the Uniform Commercial Code.  Applicants for such substitute
Warrant shall also comply with such other reasonable regulations and pay such
other reasonable charges as the Company or the Warrant Agent may
prescribe.

     

    SECTION
11. Reservation
of Shares of Common Stock.  The Company will at all times
reserve and keep available, free from preemptive rights, out of the aggregate of
its authorized but unissued shares of Common Stock, for the purpose of enabling
it

     

     

    
      
        
           

        

        
          10

          
            

          

        

        
           

        

      

    

     

    to
satisfy any obligation to issue shares of Common Stock upon exercise of
Warrants, the maximum number of shares of Common Stock which may then be
deliverable upon the exercise of all outstanding Warrants.

     

    The
Company or the transfer agent for Common Stock and every subsequent transfer
agent for any shares of the Company’s capital stock issuable upon the exercise
or of any of the rights of purchase represented by the Warrants as aforesaid
(the “Transfer
Agent”) will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be required for such
purpose.  The Company will keep a copy of this Warrant Agreement on
file with the Transfer Agent for any shares of the Company’s capital stock
issuable upon the exercise of the rights of purchase represented by the
Warrants.  The Warrant Agent is hereby irrevocably authorized and
directed to requisition from time to time from such Transfer Agent the stock
certificates required to honor outstanding Warrants upon exercise thereof in
accordance with the terms of this Warrant Agreement.  The Company will
supply such Transfer Agent with duly executed certificates for such purposes and
will, upon request, provide or otherwise make available any cash which may be
payable as provided in Section
16.  The Company will furnish such Transfer Agent a copy of all
notices of adjustments and certificates related thereto, transmitted to the
Warrant Agent and each holder pursuant to Section
17.

     

    The
Company covenants that all shares of Common Stock which may be issued upon
exercise of Warrants will be, upon payment of the aggregate Exercise Price and
issuance thereof (in the case of an exercise), fully paid, nonassessable, free
of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof (other than any liens, charges and
security interests created by the Warrant holder or the person to which the
shares of Common Stock are to be issued).

     

    SECTION
12. Adjustment
of Exercise Price and Number of Shares of Common Stock
Issuable.  The Exercise Price and the number of shares of
Common Stock issuable upon the exercise of each Warrant are subject to
adjustment from time to time upon the occurrence of the events enumerated in
this Section
12, without duplication.  For purposes of this Section
12, “Common Stock” means, subject to Section
12(k), the shares of Original Common Stock from time to time authorized
and any other stock of the Company, however designated, the holders of which
have the right (subject to any prior rights of any class or series of preferred
stock) to participate in any distribution of the assets or earnings of the
Company without limit as to per share amount.

     

    (a)           Adjustment
for Change in Capital Stock.  If on or after the date of this
Warrant Agreement and prior to the Expiration Date, the Company:

     

    (1)           pays
a dividend in shares of Common Stock or makes a distribution on its Common Stock
in shares of Common Stock;

     

    (2)           subdivides
its outstanding shares of Common Stock into a greater number of shares (other
than upon a reclassification to which clause (5) of this Section
12(a) or Section
12(k) applies);

     

     

    
      
        
           

        

        
          11

          
            

          

        

        
           

        

      

    

     

    (3)           combines
its outstanding shares of Common Stock into a smaller number of shares (other
than upon a reclassification to which clause (5) of this Section
12(a) or Section
12(k) applies);

     

    (4)           makes
a distribution on its Common Stock in shares of its capital stock other than
Common Stock; or

     

    (5)           issues
by reclassification of its Common Stock any shares of its capital stock
(including any such reclassification in connection with a consolidation or
merger of the Company in which the Company is the surviving entity but excluding
any reclassification in which property other than shares of capital stock is
issued (in which event Section
12(k) shall apply)),

     

    then the
number of shares of Common Stock or other shares of capital stock of the Company
receivable upon exercise of each Warrant immediately prior thereto shall be
adjusted so that the holder of each Warrant shall be entitled upon exercise to
receive the kind and number of shares of Common Stock or other shares of capital
stock of the Company that such holder would have been entitled to receive upon
the happening of any of the events described above, had such Warrant been
exercised immediately prior to the happening of such event or any record date
with respect thereto. An adjustment made pursuant to this paragraph (a) shall
become effective immediately after the effective date of such event retroactive
to the record date, if any, for such event.

     

    (b)           Adjustment
of Exercise Price.  Whenever the number of shares of Common
Stock or other shares of capital stock of the Company receivable upon the
exercise of any Warrant is otherwise required to be adjusted as herein provided
(whether or not the Company then or thereafter elects to issue additional
Warrants in substitution for an adjustment in the number of shares of Common
Stock or other shares of capital stock receivable upon exercise of each Warrant
as provided in Section
12(f)), the Exercise Price payable per share of Common Stock upon
exercise of such Warrant shall be adjusted by multiplying such Exercise Price
immediately prior to such adjustment by a fraction, of which the numerator shall
be the number of shares of Common Stock receivable upon the exercise of such
Warrant immediately prior to such adjustment, and of which the denominator shall
be the number of shares of Common Stock (or, where clause (4) or (5) of Section
12(a) applies and shares of capital stock (other than solely Common
Stock) become so receivable, the number of shares of Common Stock equivalent to
such shares of capital stock based on the relative fair market values hereof (as
determined in good faith by the Board)) so receivable immediately
thereafter.

     

    If after
an adjustment a holder of a Warrant upon exercise thereof may receive shares of
two or more classes or series of capital stock of the Company, the Company, in
good faith, shall determine as the adjusted Exercise Price for each share of
capital stock (other than Common Stock) so receivable an amount equal to the
Exercise Price per share of Common Stock as adjusted pursuant to the preceding
paragraph, multiplied by a fraction the denominator of which is the fair market
value of a share of Common Stock and the numerator of which is the fair market
value of such share of other capital stock (as determined in good faith by the
Board).  After such allocation, the exercise privilege and the
Exercise Price of each class or series of

     

     

    
      
        
           

        

        
          12

          
            

          

        

        
           

        

      

    

     

    capital
stock shall thereafter again be subject to adjustment on terms comparable to
those applicable to shares of Common Stock in this Section
12.

     

    (c)           When De
Minimis Adjustment May Be Deferred.  No adjustment in the
Exercise Price need be made unless the adjustment would require an increase or
decrease of at least one percent (l%) in the Exercise Price.  Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment.

     

    All
calculations under this Section
12 shall be made to the nearest cent or to the nearest 1/100th of a
share, as the case may be.

     

    (d)           When No
Adjustment Required.  No adjustment need be made pursuant to
Section
12(a) or 12(b) for a transaction referred to in Section
12(a) if Warrant holders participate in such transaction on a basis and
with notice that the Board determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction.

     

    No
adjustment need be made for any issuance of securities by the Company on the
Effective Date of the Plan or pursuant to the Plan.

     

    No
adjustment need be made for rights to purchase Common Stock pursuant to a
Company plan for reinvestment of dividends or interest.

     

    No
adjustment need be made for a change in the par value or no par value of the
Common Stock.

     

    Notwithstanding
any other provision of this Section
12, no adjustment to the Exercise Price shall result in zero or in a
negative number.

     

    To the
extent the Warrants become exercisable into cash, no adjustment need be made
thereafter as to the cash.  Interest will not accrue on the
cash.

     

    (e)           Notice of
Certain Transactions.

     

    If:

     

    (i)           the
Company takes any action that would require an adjustment to the Exercise Price
or the number of shares of Common Stock or other shares of capital stock
receivable upon exercise of Warrants pursuant to Section
12(a) or (b)
and if the Company does not arrange for Warrant holders to participate in such
transaction pursuant to Section
12(d);

     

    (ii)           the
Company determines to adjust the number of Warrants pursuant to Section
12(f); or

     

    (iii)           there
is a liquidation or dissolution of the Company,

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    the
Company shall mail to Warrant holders a notice stating the proposed record date
for a dividend or distribution or the proposed effective date of a subdivision,
combination, reclassification, consolidation, merger, liquidation or
dissolution.  The Company shall mail the notice at least fifteen (15)
days before such date.  Failure to mail the notice or any defect in it
shall not affect the validity of the transaction.

     

    Whenever
the Exercise Price is adjusted, the Company also shall provide the notices
required by Section
20.

     

    (f)           Company
Discretion Regarding Adjustment in Number of Warrants.  The
Company may elect, in its sole discretion, on the date of any adjustment in the
number of Warrant Shares receivable upon exercise of Warrants required by
paragraph (a) of this Section
12, to adjust the number of Warrants held by any holder of any Warrant
Certificate in substitution for an adjustment in the number of Warrant Shares
receivable upon the exercise of a Warrant.  And, in such events, each
of the Warrants outstanding after such adjustment of the number of Warrants
shall be exercisable for the same number of Warrant Shares as immediately prior
to such adjustment. Each holder of a Warrant Certificate held of record prior to
such adjustment of the number of Warrants shall be entitled to receive in
respect of each Warrant evidenced by such previously outstanding Warrant
Certificate a new Warrant Certificate evidencing additional
Warrants  equal to the excess of (i) that number of Warrants
(calculated to the nearest one-hundredth) obtained by dividing the applicable
Exercise Price in effect prior to adjustment of such Exercise Price by the
applicable Exercise Price in effect after adjustment of such Exercise Price
over
(ii) one (1). The Company shall notify the holders of Warrants of its election
to adjust the number of Warrants in the same manner as provided in paragraph (e)
of this Section
12, indicating the record date for the adjustment, and, if known at the
time, the amount of the adjustment to be made, and shall give prompt written
notice thereof to the Warrant Agent.  This record date may be the date
on which the Exercise Price is adjusted or any day thereafter. Upon each
adjustment of the number of Warrants pursuant to this Section
12(f), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Warrants on such record date Warrant
Certificates evidencing, subject to Section
14, the additional Warrants 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
Warrant Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Warrant Certificates
evidencing all the Warrants evidenced by the Warrant Certificates previously so
held and the additional Warrants to which such holders are so entitled, all to
be issued, executed and registered in the manner specified in Sections
4 and 5
(and which may bear, at the option of the Company, the applicable adjusted
Exercise Price) and to be registered in the names of the holders of record of
Warrant Certificates on the record date specified in the notice.

     

    (g)           Form of
Warrants.  The Company may, but (except to the extent Section
12(f) applies) shall not be required to, issue new certificates or make a
notation on any outstanding certificates to reflect any adjustment under this
Section
12.  Irrespective of any adjustments in the Exercise Price or
the number or kind of shares purchasable upon the exercise of the Warrants,
Warrant Certificates evidencing Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of shares as are stated
in the Warrant Certificates evidencing Warrants initially issuable pursuant to
this Warrant Agreement.

     

     

    
      
        
           

        

        
          14

          
            

          

        

        
           

        

      

    

     

    (h)           The Company
Determination Final.  Any determination that the Company or the
Board must make pursuant to this Section
12 is (absent manifest error) conclusive if such determination is made in
good faith.

     

    (i)           Warrant
Agent’s Disclaimer.  The Warrant Agent has no duty to determine
when an adjustment under this Section
12 should be made (if at all), how it should be made or what it should
be.  The Warrant Agent makes no representation as to the validity or
value of any securities or assets issued upon exercise of
Warrants.  The Warrant Agent shall not be responsible for the
Company’s failure to comply with this Section
12.  The Warrant Agent shall not be deemed to have knowledge of
any adjustment under this Section
12 until it has received notice thereof pursuant to Section
12.

     

    (j)           Optional
Tax Adjustment.  The Company may at its option, at any time prior to
the Expiration Date, increase the number of shares of Common Stock or other
shares of capital stock into which each Warrant is exercisable, or decrease the
Exercise Price, in addition to those changes required by Sections
12(a) and (b),
as deemed advisable by the Board, in order that any event treated for Federal
income tax purposes as a dividend of stock or stock rights shall not be taxable
to the recipients.

     

    (k)           Changes in
Common Stock.  In case at any time or from time to time while
the Warrants remain outstanding and unexpired in whole or in part, the Company
shall be a party to or shall otherwise engage in any transaction or series of
related transactions constituting:

     

     (i)                 a
merger of the Company into, a consolidation of the Company with, or a sale of
all or substantially all of the Company’s assets to, any other Person (a “Non-Surviving
Transaction”), or

     

     (ii)                 any
reclassification of the Common Stock into securities or other property (other
than solely into shares of capital stock of the Company (in which event Section
12(a)(5) shall apply)), or any merger of another Person into the Company
in which the previously outstanding shares of Common Stock shall be cancelled,
reclassified or converted or changed into or exchanged for securities of the
Company or other property (including cash) or any combination of the foregoing
(other than solely into or for shares of capital stock of the Company (in which
event Section
12(a)(5) shall apply)) (a “Surviving
Transaction”; any Non-Surviving Transaction or Surviving Transaction
being herein called a “Transaction”),

     

    then, as
a condition to the consummation of such Transaction, the Company shall (or, in
the case of any Non-Surviving Transaction, the Company shall cause such other
Person to) execute and deliver to the Warrant Agent a written instrument
providing that:

     

    (x)           so
long as any Warrant remains outstanding on such terms and subject to such
conditions as shall be as nearly equivalent as may be practicable to the
provisions set forth in this Agreement, each Warrant, upon the exercise thereof
at any time on or after the consummation of such Transaction, shall be
exercisable:

     

    (I)           into,
in lieu of the Common Stock issuable upon such exercise prior to

     

     

    
      
        
           

        

        
          15

          
            

          

        

        
           

        

      

    

     

    such
consummation, only the securities or other property (“Substituted
Property”) that would have been receivable upon such Transaction by a
holder of the number of shares of Common Stock into which such Warrant was
exercisable immediately prior to such Transaction, assuming (except in the case
of a reclassification) such holder of Common Stock:

     

    (A)           is
not a Person with which the Company consolidated or into which the Company
merged or which merged into the Company or to which such sale or transfer was
made, as the case may be (“Constituent
Person”), or an affiliate of a Constituent Person; and

     

    (B)           failed
to exercise his rights of election, if any, as to the kind or amount of
securities, cash and other property receivable upon such Transaction (provided
that if the kind or amount of securities, cash and other property receivable
upon such Transaction is not the same for each share of Common Stock held
immediately prior to such Transaction by other than a Constituent Person or an
affiliate thereof and in respect of which such rights of election shall not have
been exercised (“Non-Electing
Share”), then, for the purposes of this Section
12(k), the kind and amount of securities, cash and other property
receivable upon such Transaction by each Non-Electing Share shall be deemed to
be the kind and amount so receivable per share by a plurality of the
Non-Electing Shares); and

     

    (II)           at
an Exercise Price for such Substituted Property equal to the aggregate Exercise
Price payable by such holder for all such shares of Common Stock into which such
Warrant was exercisable immediately prior to such Transaction; and

     

    (y)           the
rights and obligations of the Company (or, in the event of a Non-Surviving
Transaction, such other Person) and the holders in respect of Substituted
Property shall be as nearly equivalent as may be practicable to the rights and
obligations of the Company and holders in respect of Common Stock hereunder as
set forth in Section
8 hereof and elsewhere herein.

     

    Such
written instrument shall provide for adjustments which, for events subsequent to
the effective date of such written instrument, shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section
12.  The above provisions of this Section
12(k) shall similarly apply to successive Transactions.

     

    SECTION
13. Priority
Adjustments, Further Actions.  (a) If any single action would
require adjustment of the Exercise Price pursuant to more than one subsection of
Section
12, only one adjustment shall be made and such adjustment shall be the
amount of adjustment that has the highest, relative to the rights and interests
of the registered holders of the Warrants then outstanding, absolute
value.

     

    (b)      
The
Company will not, by amendment of its charter or through any consolidation,
merger, reorganization, transfer of assets, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of the Warrants, but will at all times in
good faith assist in the carrying out of all such terms.  Without
limiting the generality of the foregoing, the Company (i) will take all such
action

     

     

    
      
        
           

        

        
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    as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock on the exercise of the
Warrants from time to time outstanding and (ii) will not take any action which
results in any adjustment of the Exercise Price if the total number of shares of
Common Stock issuable after the action upon the exercise of all of the Warrants
would exceed the total number of shares of Common Stock then authorized by the
Company’s certificate of incorporation, as may be amended and in effect from
time to time and available for the purposes of issue upon such
exercise.  Notwithstanding the previous sentences, the Company shall
not be prohibited from effecting a consolidation, merger, reorganization or
transfer of assets by this Section
13.

     

    SECTION
14. Fractional
Interests.  The Company shall not be required to issue
fractional shares of Common Stock on the exercise of Warrants.  If
more than one Warrant shall be presented for exercise at the same time by the
same holder, the number of full shares of Common Stock which shall be issuable
upon the exercise thereof shall be computed on the basis of the aggregate number
of shares of Common Stock purchasable on exercise of all of the Warrants so
presented.  If any fraction of a share of Common Stock would, except
for the provisions of this Section
14, be issuable on the exercise of any Warrants (or specified portion
thereof), the Company shall notify the Warrant Agent in writing of the amount to
be paid in lieu of the fraction of a share of Common Stock and concurrently pay
or provide to the Warrant Agent for repayment to the Warrant holder an amount in
cash equal to the product of (i) such fraction of a share of Common Stock and
(ii) the excess of (x) the closing price of a share of Common Stock for the day
immediately preceding the date the Warrant was presented for exercise pursuant
to Section
8 over (y) the Exercise Price.

     

    SECTION
15. Warrant
Holders not Stockholders.  Nothing contained in this Warrant
Agreement or in any of the Warrant Certificates shall be construed as conferring
upon the holders of any Warrant Certificate or any Warrants (i) the right to
vote or to consent or to receive notice as stockholders in respect of the
meetings of stockholders or the election of Directors of the Company or any
other matter or to attend any such meetings or any other proceedings of the
holders of Common Stock; (ii) the right to receive any cash dividends, stock
dividends, allotments or rights or other distributions paid, allotted or
distributed or distributable to the holders of Common Stock prior to, or for
which the relevant record date precedes, the date of the exercise of such
Warrant (except to the extent the first sentence of Section
16(d) applies); or (iii), or any other rights whatsoever as stockholders
of the Company.

     

    SECTION
16. Merger,
Consolidation or Change of Name of Warrant Agent.  Any person
into which the Warrant Agent may be merged or converted or with which it may be
consolidated, or any person resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any person
succeeding to all or substantially all of the corporate trust or agency business
of the Warrant Agent, shall be the successor to the Warrant Agent hereunder
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.  If, at the time such successor to the
Warrant Agent by merger or consolidation succeeds to the agency created by this
Warrant Agreement, any of the Warrant Certificates shall have been countersigned
but not delivered, any such successor to the Warrant Agent may adopt the
countersignature of the original Warrant Agent; and if, at that time any of the
Warrant Certificates shall not have been countersigned, any such successor to
the Warrant Agent may countersign such Warrant Certificates either in
the

     

     

    
      
        
           

        

        
          17

          
            

          

        

        
           

        

      

    

     

    name of
the predecessor Warrant Agent or in the name of the successor Warrant Agent; and
in all such cases such Warrant Certificates shall have the full force and effect
provided in the Warrant Certificates in this Warrant Agreement.

     

    SECTION
17. Warrant
Agent.  The Warrant Agent undertakes only the duties and
obligations imposed by this Warrant Agreement upon the following terms and
conditions, by all of which the Company and the holders of Warrants, by their
acceptance thereof, shall be bound:

     

    (a)    
The
statements contained herein and in the Warrant Certificates shall be taken as
statements of the Company.  The Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it.  The Warrant
Agent assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.

     

    (b)    
Whenever
in the performance of its duties under this Warrant Agreement the Warrant Agent
deems it necessary or desirable that any fact or matter be proved or established
by the Company prior to taking, suffering or omitting to take any action
hereunder, such fact or matter may be deemed to be conclusively proved and
established by a certificate signed by the Company’s Chairman of the Board,
Chief Executive Officer or any Vice President and delivered to the Warrant
Agent; and in reliance upon such certificate, the Warrant Agent shall take any
action or omit to take any action authorized under the provisions of this
Warrant Agreement.  In the event the Warrant Agent reasonably believes
any ambiguity or uncertainty exists hereunder or in any notice, instruction,
direction, request or other communication, paper or document received by the
Warrant Agent hereunder, or is uncertain of any action to take hereunder, the
Warrant Agent, may, following prior written notice to the Company, refrain
from  taking any action, and shall be fully protected and shall not be
liable in any way to the Company or any other person or entity for refraining
from taking such action, unless the Warrant Agent receives
written  instructions signed by the Company which eliminates such
ambiguity or uncertainty to the reasonable satisfaction of the Warrant
Agent.

     

    (c)    
The
Warrant Agent shall not be responsible for any failure of the Company to comply
with any of the covenants contained in this Warrant Agreement (including,
without limitation, any adjustment of the Exercise Price pursuant to Section
12, the authorization or reservation of shares of Common Stock pursuant
to Section
11, the due execution and delivery by the Company of this Warrant
Agreement or any Warrant Certificate) or in the Warrant Certificates to be
complied with by the Company.

     

    (d)    
The
Warrant Agent may consult at any time with counsel satisfactory to it (who may
be counsel for the Company or an employee of the Warrant Agent) and the Warrant
Agent shall incur no liability or responsibility to the Company or to any holder
of any Warrant Certificate in respect of any action

     

     

    
      
        
           

        

        
          18

          
            

          

        

        
           

        

      

    

     

    taken,
suffered or omitted by it hereunder in good faith and in accordance with the
opinion or the advice of such counsel.

     

    (e)    
The
Warrant Agent shall incur no liability or responsibility to the Company or to
any holder of any Warrant Certificate for any action taken in reliance on any
Warrant Certificate, certificate representing shares of Common Stock, notice,
resolution, waiver, consent, order, certificate, or other paper, document or
instrument believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties.  The Warrant Agent shall not
be bound by any notice or demand, or any waiver, modification, termination or
revision of this Warrant Agreement or any of the terms hereof, unless evidenced
by a writing between and signed by, the Company and the Warrant
Agent.  The Warrant Agent shall not be required to take instructions
or directions except those given in accordance with this Warrant
Agreement.

     

    (f)    
The
Warrant 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, accountants, agents or other experts, and  the Warrant
Agent will not be answerable or accountable for any act, default, neglect or
unintentional misconduct of any such attorneys or agents or for any loss to the
Company or the holders of the Warrants resulting from any such act, default,
neglect or unintentional misconduct, absent gross negligence, willful misconduct
or bad faith (as each is determined by a final non-appealable order of a court
of competent jurisdiction) in the selection and continued employment thereof.
Notwithstanding anything contained herein to the contrary, except to the extent
liabilities arise from the Warrant Agent’s willful misconduct or bad faith, the
Warrant Agent’s aggregate liability during any term of this Agreement with
respect to, arising from, or arising in connection with this Agreement, or from
all Services provided or omitted to be provided under this Agreement, whether in
contract, or in tort, or otherwise, is limited to, and shall not exceed, the
amounts paid hereunder by the Company to Warrant Agent as fees and charges, but
not including reimbursable expenses.

     

    (g)    
The
Warrant Agent will not be under any duty or responsibility to insure compliance
with any applicable federal or state securities laws in connection with the
issuance, transfer or exchange of Warrant Certificates.

     

    (h)    
The
Warrant Agent shall not incur any liability for not performing any act, duty,
obligation or responsibility by reason of any occurrence beyond the control of
the Warrant Agent (including without limitation any act or provision of any
present or future law or regulation or governmental authority, any act of God,
war, civil disorder or failure of any means of
communication).

     

    (i)    
The
Company agrees to pay to the Warrant Agent reasonable compensation for all
services rendered by the Warrant Agent in the execution of this Warrant
Agreement, to reimburse the Warrant Agent for all

     

     

    
      
        
           

        

        
          19

          
            

          

        

        
           

        

      

    

     

    expenses
(including reasonable counsel fees), taxes (including withholding taxes) and
governmental charges and other charges of any kind and nature actually incurred
by the Warrant Agent in the execution, delivery and performance of its
responsibilities under this Warrant Agreement and to indemnify the Warrant Agent
and save it harmless against any and all liabilities, including judgments, costs
and counsel fees, for anything done or omitted by the Warrant Agent in the
execution, delivery and performance of its responsibilities under this Warrant
Agreement except as a result of its gross negligence, bad faith or willful
misconduct (as each is determined by a final non-appealable order of a court of
competent jurisdiction).

     

    (j)    
The
Warrant Agent, shall be under no obligation to institute any action, suit or
legal proceeding or to take any other action likely to involve expense unless
the Company or one or more registered holders of Warrant Certificates shall
furnish the Warrant Agent with reasonable security and indemnity for any costs
and expenses which may be incurred, but this provision shall not affect the
power of the Warrant Agent to take such action as it may consider proper,
whether with or without any such security or indemnity.  All rights of
action under this Warrant Agreement or under any of the Warrants may be enforced
by the Warrant Agent without the possession of any of the Warrant Certificates
or the production thereof at any trial or other proceeding relative thereto, and
any such action, suit or proceeding instituted by the Warrant Agent shall be
brought in its name as Warrant Agent and any recovery of judgment shall be for
the ratable benefit of the registered holders of the Warrants, as their
respective rights or interests may appear.

     

    (k)    
Except as
otherwise prohibited by applicable law, the Warrant Agent, and any stockholder,
director, officer or employee of the Warrant Agent, may buy, sell or deal in any
of the Warrants 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 Warrant Agent under this Warrant
Agreement.  Nothing herein shall preclude the Warrant Agent from
acting in any other capacity for the Company or for any other legal
entity.

     

    (l)    
The
Warrant Agent shall act hereunder solely as agent for the Company, and its
duties shall be determined solely by the express provisions
hereof.  The Warrant Agent shall not be liable for anything which it
may do or refrain from doing in connection with this Warrant Agreement, except
for its own gross negligence, bad faith or willful misconduct (as each is
determined by a final non-appealable order of a court of competent
jurisdiction); provided that in no event shall the Warrant Agent be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Warrant Agent has been
advised of the likelihood of such loss or damage and regardless of the form of
action.

     

     

    
      
        
           

        

        
          20

          
            

          

        

        
           

        

      

    

     

    (m)    
The
Warrant Agent shall not at any time be under any duty or responsibility to any
holder of any Warrant Certificate to make or cause to be made any adjustment of
the Exercise Price or number of the shares of Common Stock or other securities
or property deliverable as provided in this Warrant Agreement, or to determine
whether any facts exist which may require any of such adjustments, or with
respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same.  The Warrant Agent
shall not be accountable with respect to the validity or value or the kind or
amount of any shares of Common Stock or of any securities or property which may
at any time be issued or delivered upon the exercise of any Warrant or with
respect to whether any such shares of Common Stock or other securities will when
issued be validly issued and fully paid and nonassessable, and makes no
representation with respect thereto.

     

    (n)    
Notwithstanding
the foregoing, nothing in this Section
17 shall relieve the Warrant Agent from any liability arising from the
Warrant Agent’s transfer of any Warrant without obtaining confirmation from the
Company as described in Section
6(a).

     

    (o)    
All
rights and obligations contained in this Section
17 and Section 18
shall survive the termination of this Warrant Agreement and the resignation or
removal of the Warrant Agent.

     

    SECTION
18. Expenses.  All
expenses incident to the Company’s performance of or compliance with this
Warrant Agreement will be borne by the Company, including without limitation:
(i) all expenses of printing Warrant Certificates; (ii) messenger and delivery
services and telephone calls; (iii) all fees and disbursements of counsel for
the Company; (iv) all fees and disbursements of independent certified public
accountants or knowledgeable experts selected by the Company; and (v) the
Company’s internal expenses (including, without limitation, all salaries and
expenses of their officers and employees performing legal or accounting
duties).

     

    SECTION
19. Change of
Warrant Agent.  If the Company terminates the Warrant Agent or
the Warrant Agent shall become incapable of acting as Warrant Agent or shall
resign as provided below, the Company shall appoint a successor to such Warrant
Agent.  If the Company shall fail to make such appointment within a
period of 30 days after it has terminated the Warrant Agent or it has been
notified in writing of a resignation or incapacity by the Warrant Agent, then
the registered holder of any Warrant Certificate may apply to any court of
competent jurisdiction for the appointment of a successor to the Warrant
Agent.  Pending appointment of a successor to such Warrant Agent,
either by the Company or by such a court, the duties of the Warrant Agent shall
be carried out by the Company.  After appointment, the successor to
the Warrant Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the former Warrant Agent shall deliver and transfer to
the successor to the Warrant 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.  Failure to give any notice provided for in
this

     

     

    
      
        
           

        

        
          21

          
            

          

        

        
           

        

      

    

     

    Section
19, however, or any defect therein, shall not affect the legality or
validity of the appointment of a successor to the Warrant
Agent.

     

    The
Warrant Agent may resign at any time and be discharged from the obligations
hereby created by so notifying the Company in writing at least 30 days in
advance of the proposed effective date of its resignation.  If no
successor Warrant Agent accepts the engagement hereunder by such time, the
Company shall act as Warrant Agent.

     

    SECTION
20. Notices to
the Company and Warrant Agent.  Any notice or demand authorized
or permitted by this Warrant Agreement to be given or made by the Warrant Agent
or by the registered holder of any Warrant Certificate to or on the Company
shall be sufficiently given or made when and if deposited in the mail, first
class or registered, postage prepaid, addressed (until another address is filed
in writing by the Company with the Warrant Agent), as
follows:

     

    Calpine
Corporation

    717 Texas
Avenue, Suite 1000

    Houston,
Texas  77002

    Attn.:        Gregory
L. Doody

    Executive
Vice President, General Counsel, and Secretary

    Facsimile:
713-830-8708

     

    with
a copy to:

     

    Kirkland &
Ellis LLP

    200 East
Randolph Drive

    Chicago,
Illinois  60601 6636

    Attn:         Marc
Kieselstein, P.C.

                   
David R. Seligman

                   
Carter W. Emerson, P.C.

                   
Gerald T. Nowak

    Facsimile:
312-861-2200

     

    Any
notice pursuant to this Warrant Agreement to be given by the Company or by the
registered holder(s) of any Warrant Certificate to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or registered,
postage prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Company) to the Warrant Agent at the Warrant Agent Office
as follows:

     

    Computershare
Trust Company, N.A.

    250
Royall Street

    Canton,
MA  02021

    Attn:         Computershare
Shareholder Services

    Telephone:           (800)
546-5141

    Facsimile:             (781)
575-2901

     

    SECTION
21. Supplements
and Amendments.  The Company and the Warrant Agent may from
time to time supplement or amend this Warrant Agreement
without

     

     

    
      
        
           

        

        
          22

          
            

          

        

        
           

        

      

    

     

    the
approval of any holders of Warrant Certificates in order to cure any ambiguity
or to correct or supplement any provision contained herein which may be
defective or inconsistent with any other provision herein, or to make any other
provisions in regard to matters or questions arising hereunder which the Company
and the Warrant Agent may deem necessary or desirable and which shall not in any
way adversely affect the rights or interests of the holders of Warrant
Certificates.  Any amendment or supplement to this Warrant Agreement
that has an adverse effect on the rights or interests of holders of the Warrants
shall require the written consent of registered holders of a majority of the
then outstanding Warrants (excluding Warrants held by the Company or any of its
controlled affiliates).  The consent of each holder of a Warrant
affected shall be required for any amendment of this Warrant Agreement pursuant
to which the Exercise Price would be increased or the number of shares of Common
Stock purchasable upon exercise of the Warrants would be decreased; provided,
however,
that such consent shall not be required for any adjustment to the Exercise Price
or the number of shares purchasable, if made pursuant to the provisions of Section
12 of this Warrant Agreement.  The Warrant Agent shall have no
duty to determine whether any such amendment would have an adverse effect on the
rights or interests of the holders of the Warrants.  The Warrant Agent
may, but shall not be obligated to, execute any amendment or supplement which
adversely affects the rights or increases the duties or obligations of the
Warrant Agent.

     

    SECTION
22. Successors.
(a) All the covenants and provisions of this Warrant Agreement by or for the
benefit of the Company or the Warrant Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder and the registered holders
from the time of the Warrant Certificates.

     

    (b)       So long as
Warrants remain outstanding, the Company will not enter into any Non-Surviving
Transaction (as defined in Section
12(k)) unless the acquirer shall expressly assume by a supplemental
agreement, executed and delivered to the Warrant Agent, in form reasonably
satisfactory to the Warrant Agent, the due and punctual performance of every
covenant of this Agreement on the part of the Company to be performed and
observed and shall have provided for exercise rights in accordance with Section
12(k).  Upon the consummation of such Non-Surviving
Transaction, the acquirer shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Agreement with the
same effect as if such acquirer had been named as the Company
herein.

     

    SECTION
23. Termination.  This
Warrant Agreement shall terminate at 5:00 p.m., New York City time, on the
Expiration Date (or, if later, the Settlement Date with respect to any Warrant
Exercise Notice delivered prior to 5:00 p.m., New York City time, on the
Expiration Date).  Notwithstanding the foregoing, this Warrant
Agreement will terminate on such earlier date on which all outstanding Warrants
have been exercised.  The provisions of Section
8 and Section
18 shall survive such termination.  Termination of the Warrant
Agreement shall not relieve the Company or the Warrant Agent of any of their
obligations arising prior to the date of such termination or in connection with
the settlement of any Warrant exercised prior to the Expiration
Date.

     

    SECTION
24. Governing
Law; Jurisdiction.  This Warrant Agreement and each Warrant
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of New York and for all purposes shall be governed by and
construed

     

     

    
      
        
           

        

        
          23

          
            

          

        

        
           

        

      

    

     

    in
accordance with the laws of the State of New York (including New York General
Obligations Law § 5-1401).  The parties hereto irrevocably
consent to the jurisdiction of the courts of the State of New York and any
federal court located in such state in connection with any action, suit or
proceeding arising out of or relating to this Warrant Agreement.

     

    SECTION
25. Benefits of
this Warrant Agreement.  This Warrant Agreement shall be for
the sole and exclusive benefit of the Company, the Warrant Agent and the
registered holders of the Warrant Certificates, and nothing in this Warrant
Agreement shall be construed to give to any person other than the Company and
the Warrant Agent any legal or equitable right, remedy or claim under this
Warrant Agreement.  Each holder, by acceptance of a Warrant
Certificate, agrees to all of the terms and provisions of this Agreement
applicable thereto.  Notwithstanding anything contained in this
Agreement to the contrary, each holder, by acceptance of a Warrant Certificate,
hereby agrees that the assertion of any legal or equitable right, remedy or
claim under this Warrant Agreement shall be made by such holder solely against
the Company and in no event against the Warrant Agent or its employees, agents
or affiliates.

     

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

     

    SECTION
27. Further
Assurances.  From time to time on and after the date hereof,
the Company shall deliver or cause to be delivered to the Warrant Agent such
further documents and instruments and shall do and cause to be done such further
acts as the Warrant Agent shall reasonably request (it being understood that the
Warrant Agent shall have no obligation to make such request) to carry out more
effectively the provisions and purposes of this Warrant Agreement, to evidence
compliance herewith or to assure itself that it is protected
hereunder.

     

    SECTION
28. Entire
Agreement.  This Warrant Agreement and the Warrant Certificates
constitute the entire agreement of the Company, the Warrant Agent and the
registered holders of the Warrant Certificates with respect to the subject
matter hereof and supersedes all prior agreements and undertakings, both written
and oral, among the Company, the Warrant Agent and the registered holders of the
Warrant Certificates with respect to the subject matter
hereof.

     

     

    
      
        
           

        

        
          24

          
            

          

        

        
           

        

      

    

     

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

     

     

     

    
      	 	CALPINE
      CORPORATION
	 	 	 
	 	 	 
	 
      	
              By:

            	
              /s/  Gregory
      L. Doody

            
	 
      	 
      	
              Name: 
      Gregory L. Doody

            
	 
      	 
      	
              Title:   
      Executive Vice President,

            
	 
      	 
      	
                         
       General Counsel and Secretary

            

    

     

     

     

    
      	 	COMPUTERSHARE
      TRUST COMPANY, N.A.
	 	 	 
	 	 	 
	 
      	
              By:

            	
              /s/  Thomas
      Borbely

            
	 
      	 
      	
              Name: 
      Thomas Borbely

            
	 
      	 
      	
              Title:   
      Director, Corporation Actions

            

    

     

     

     

    
      	 	COMPUTERSHARE
      INC.
	 	 	 
	 	 	 
	 
      	
              By:

            	
              /s/  Thomas
      Borbely

            
	 
      	 
      	
              Name: 
      Thomas Borbely

            
	 
      	 
      	
              Title:   
      Director, Corporation Actions

            

     

     

    

    
      
        
          
            [Signature
Page to Series A Warrant Agreement]

            

          

           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
A

     

    
       

       

       

       

      

       

       

       

      
        016570|
003590|127C|RESTRICTED||4|057−423

        SERIES
A WARRANT

        NO
PAR VALUE

        SERIES
A WARRANT

        THIS
CERTIFICATE IS TRANSFERABLE IN

        CANTON,
MA AND JERSEY CITY, NJ

        Certificate
Number

        ZQ
000000

        Warrants

        *
* 6 0 0 6 2 0 * * * * * *

        *
* * 6 0 0 6 2 0 * * * * *

        *
* * * 6 0 0 6 2 0 * * * *

        *
* * * * 6 0 0 6 2 0 * * *

        *
* * * * * 6 0 0 6 2 0 * *

        THIS
CERTIFIES THAT

        CALPINE
CORPORATION

        INCORPORATED
UNDER THE LAWS OF THE STATE OF DELAWARE

        **
Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr.

        Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample ****
Mr.

        Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample MR. SAMPLE &
MRS. SAMPLE &**** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
Alexander

        David
Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
David

        Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David
Sample

        ****
Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander MR. SAMPLE &
MRS. SAMPLE David Sample **** Mr. Alexander David Sample **** Mr. Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr.

        Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample ****
Mr.

        Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Alexander David Sample **** Mr. Alexander David Sample ****
Mr.

        Alexander
David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
**** Mr. Sample **** Mr. Sample

        CUSIP
131347 11 4

        SEE
REVERSE FOR CERTAIN DEFINITIONS

        is
the owner of

        **600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****60***SIX
HUNDRED THOUSAND0620**Shares****600620**Shares****600620**

        Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**

        Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares***600620**Shares

        ****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****

        600620**Shares****600620**SIX
HUNDRED AND
TWENTY***Shares****600620**Shares****600620**Shares****600620**

        Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**

        Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**

        Shares****600620**
Sh

        Series
A Warrant or Warrants to purchase shares of Common Stock, par value $.001 per
share (the “Common Stock”), of Calpine Corporation, a Delaware corporation (the
“Company”), subject to and upon compliance with the provisions of the Warrant
Agreement (the “Warrant Agreement”) dated February 15, 2008, between the
Company, Computershare Inc. and Computershare Trust company, N.A. (the “Warrant
Agent”). Each Warrant evidenced hereby entitles the holder upon exercise at any
time on or after the date of this Warrant Certificate and prior to August 25,
2008 (the “Expiration Date”), to purchase one fully paid and nonassessable share
of Common Stock at the purchase price of $23.88 per share (as adjusted from time
to time, the “Exercise Price”), payable in full at the time of purchase. The
number of shares of Common Stock into which and the Exercise Price at which each
Warrant shall be exercisable each are subject to adjustment as provided in the
Warrant Agreement.       The Warrants evidenced by this
certificate (this “Warrant Certificate”) are subject to the terms and conditions
set forth in the Warrant Agreement, a copy of which the Company will furnish to
the registered holder hereof, without charge, upon written request delivered to
the Secretary of the Company at its principal place of business or the Warrant
Agent.       In the event of the exercise of less than
all of the Warrants evidenced hereby, a new Warrant Certificate of the same
tenor and for the number of Warrants which are not exercised shall be issued by
the Company in the name or upon the written order of the Holder of this Warrant
Certificate upon the cancellation hereof.       Upon
surrender at the office of the Warrant Agent and payment of the charges
specified herein and in the Warrant Agreement, this Warrant Certificate may be
exchanged for Warrant Certificates in other authorized denominations or the
transfer hereof may be registered in whole or in part in authorized
denominations to one or more designated transferees; provided, however, that
such other Warrant Certificates issued upon exchange or registration of transfer
shall evidence the same aggregate number of Warrants as this Warrant
Certificate. No service charge shall be made for any registration of transfer or
exchange of Warrant Certificates; provided, however, the Company may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Warrant Certificates.       Prior to due presentment of
this Warrant Certificate for registration of transfer, the Company, the Warrant
Agent and any agent of the Company or the Warrant Agent may treat the Person in
whose name this Warrant Certificate is registered as the owner hereof for all
purposes, and neither the Company, the Warrant Agent nor any such agent shall be
affected by notice to the contrary.       Until the
exercise of any Warrant, subject to the provisions of the Warrant Agreement, no
Holder of a Warrant Certificate evidencing any Warrant shall have or exercise
any rights by virtue hereof as a holder of Common Stock of the
Company.

        Chief
Executive Officer

        Secretary

        DATED
<<Month Day, Year>>

        COUNTERSIGNED
AND REGISTERED:

        COMPUTERSHARE
TRUST COMPANY, N.A.

        TRANSFER
AGENT AND REGISTRAR,

        By

        AUTHORIZED
SIGNATURE

        SECURITY
INSTRUCTIONS ON REVERSE

        A123456

        CALPINE
CORPORATION

        PO
BOX 43004, Providence, RI 02940-3004

        MR
A SAMPLE

        DESIGNATION
(IF ANY)

        ADD
1

        ADD
2

        ADD
3

        ADD
4

        CUSIP
XXXXXX XX X

        Holder
ID XXXXXXXXXX

        Insurance
Value 1,000,000.00

        Number
of Shares 123456

        DTC
12345678 123456789012345

        Certificate
Numbers

        1234567890/1234567890

        1234567890/1234567890

        1234567890/1234567890

        1234567890/1234567890

        1234567890/1234567890

        1234567890/1234567890

        Total
Transaction

        Num/No.

        123456

        Denom.

        123456

        Total

        1234567

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

         

        

         

         

        EXERCISE
FORM (To Be Executed by the Registered Holder in Order to Exercise
Warrants)

        THE
UNDERSIGNED REGISTERED HOLDER hereby irrevocable elects to exercise ___ Warrants
represented by this Warrant Certificate, and to purchase the securities issuable
upon the exercise of such Warrants and requests that certificates for such
securities shall be issued in the name of:

        PLEASE
INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER

        And
be delivered to:

        (PLEASE
PRINT OR TYPE NAME AND ADDRESS)

        And
if such number of Warrants shall not be all the warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below: (PLEASE PRINT OR TYPE ADDRESS) Date: , 20
Signature(s) Signature(s) Guaranteed (Social Security or Taxpayer Identification
Number)

        ASSIGNMENT
(To Be Executed by the Registered Holder or Order to Assign Warrant(s) FOR VALUE
RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s) unto PLEASE
INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER (PLEASE PRINT OR TYPE NAME
AND ADDRESS) of the Warrants represented by this Warrant Certificate, and hereby
irrevocably constitutes and appoints attorney to transfer this Warrant
Certificate on the books of the Corporation, with full power of substitution in
the premises. Date: , 20 Signature(s) Signature(s) Guaranteed (Social Security
or Taxpayer Identification Number)

        THE
SIGNATURE TO THE ASSIGNMENT OR THE EXERCISE FORM MUST CORRESPOND TO THE NAME AS
WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER. THE SIGNATURE(S) SHOULD BE
GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (Banks, Stockbrokers, Savings
and Loan Associations and Credit Unions) WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE
17AD-15.

        The
following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

        TEN
COM -as tenants in common

        UNIF
GIFT MIN ACT- Custodian

        (Cust)
(Minor)

        TEN
ENT -as tenants by the entireties

        under
Uniform Gifts to Minors Act

        (State)

        JT
TEN -as joint tenants with right of survivorship and not as tenants in
common

        UNIF
TRF MIN ACT Custodian (until age. . . )

        (Cust)(Minor)

        under
Uniform Transfers to Minors Act.

        (State)

        Additional
abbreviations may also be used though not in the above list.

      

       

       

      
         

      

    

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    EXHIBIT
B

     

     

    FORM OF
FACE OF GLOBAL WARRANT CERTIFICATE

     

    VOID
AFTER AUGUST 25, 2008

     

    This
Global Warrant Certificate is held by The Depositary Trust Company (the
“Depositary”) or its nominee in custody for the benefit of the beneficial owners
hereof, and is not transferable to any person, and may not be exchanged, or the
transfer hereof registered, under any circumstances except as and to the extent
set forth in Section 6 of the Warrant Agreement.

     

    Unless
this Global Warrant Certificate is presented by an authorized representative of
the Depositary to the Company or the Warrant Agent for the registration of
transfer, exchange or payment and any certificate issued is registered in the
name of Cede & Co. or such other entity as is requested by an authorized
representative of the Depositary (and any payment hereon is made to Cede &
Co. or to such other entity as is requested by an authorized representative of
the Depositary), any transfer, pledge or other use hereof for value or otherwise
by or to any person is wrongful because the registered owner hereof, Cede &
Co., has an interest herein.

     

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    CUSIP
No._________

    No.___________________

     

     

    CALPINE
CORPORATION

     

    SERIES A
WARRANTS TO PURCHASE COMMON STOCK

     

    VOID
AFTER AUGUST 25, 2008

     

    This
Warrant Certificate (“Warrant Certificate”) certifies that Cede & Co., or
its registered assigns is the registered holder _______ of outstanding Warrants
(“Warrants”) of Calpine Corporation, a Delaware corporation (the “Company”), to
purchase shares (the “Warrant Shares”) of common stock, par value $0.001 per
share (the “Common Stock”) of the Company, as shall from time to time be reduced
or increased by endorsement on Schedule I hereto, as appropriate, in accordance
with the terms of the Warrant Agreement.  The Warrants expire on
August 25, 2008 (such date, the “Expiration Date”), and entitle the holder to
purchase from the Company, subject to and upon compliance with the provisions
thereof and of the Warrant Agreement, for each Warrant being exercised, one
fully paid and non-assessable Warrant Share at the exercise price (the “Exercise
Price”) multiplied by the number of Warrant Shares in respect of which Warrants
are being exercised (the “Exercise Amount”), payable to the Company either by
certified or official bank check payable to the order of the Company (or, if
agreed to in the sole and absolute discretion of the Company, by wire transfer
in immediately available funds to an account with the Company prior to
exercise), no later than 5:00 p.m. New York City time, on the settlement date,
which settlement date is three business days after a Warrant Exercise Notice is
delivered (the “Settlement Date”).  The initial Exercise Price shall
be $23.88.

     

    The
Exercise Price and the number of Warrant Shares purchasable upon exercise of the
Warrants evidenced hereby are subject to adjustment upon the occurrence of
certain events as set forth in the Warrant Agreement.

     

    No
Warrant may be exercised after the Expiration Date.  Any Warrants not
exercised prior to the Expiration Date shall become void and all rights
thereunder and all rights in respect thereof under the Warrant Agreement shall
cease as of the Expiration Date.

     

    REFERENCE
IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS WARRANT CERTIFICATE SET FORTH
ON THE REVERSE HEREOF.  SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.

     

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    This
Warrant Certificate shall not be valid unless countersigned by the Warrant
Agent.

     

    IN
WITNESS WHEREOF, the Company has caused this Warrant Certificate to be executed
by its duly authorized officer.

     

    Dated:___________________

     

     

                                            CALPINE
CORPORATION

     

     

     

    
      	 
      	
              By:

            	
              /s/  

            
	 
      	 
      	
              Name:

            
	 
      	 
      	
              Title:

            
	 
      	 
      	 
      

    

     

     

     

    Countersigned:

     

    COMPUSHARE
TRUST COMPANY, N.A.

     

     

    
      	
              By:

            	
              /s/  

            	 
      
	 
      	
              Name:

            	 
      
	 
      	
              Title:

            	 
      

    

     

    COMPUTERSHARE
INC.

     

     

    
      	
              By:

            	
              /s/  

            	 
      
	 
      	
              Name:

            	 
      
	 
      	
              Title:

            	 
      

    

     

     

     

     

     

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    FORM OF
REVERSE OF GLOBAL WARRANT CERTIFICATE

    EVIDENCING

    SERIES A
WARRANTS TO PURCHASE COMMON STOCK

    CALPINE
CORPORATION

     

    The
Warrants evidenced by this Warrant Certificate are part of a duly authorized
issue of Warrants to purchase an initial maximum of 48,500,000 shares of Common
Stock issued pursuant to that certain Warrant Agreement, dated as of February
15, 2008 (the “Warrant Agreement”), duly executed and delivered by the Company,
Computershare Inc. and Compushare Trust Company N.A., as Warrant Agent (the
“Warrant Agent”).  The Warrant Agreement hereby is incorporated by
reference in and made a part of this instrument and is hereby referred to for a
description of the rights, limitation of rights, obligations, duties and
immunities thereunder of the Warrant Agent, the Company and the holders (the
words “holders” or “holder” meaning the registered holders or registered holder)
of the Warrant Certificates.  A copy of the Warrant
Agreement.  The Company will furnish (or cause to be furnished) a copy
of the Warrant Agreement to the registered holder hereof, without charge, upon
written request delivered to the Secretary of the Company at its principal place
of business or the Warrant Agent.  All capitalized terms used in this
Warrant Certificate herein but not defined that are defined in the Warrant
Agreement shall have the meanings assigned to them therein.

     

    Warrants
may be exercised to purchase Warrant Shares from the Company from the date of
original issuance of the Warrant Certificates through 5:00 p.m. New York City
time on the Expiration Date, at the Exercise Price set forth on the face hereof,
subject to adjustment as described in the Warrant Agreement.  Subject
to the terms and conditions set forth herein and in the Warrant Agreement, the
holder of the Warrants evidenced by this Warrant Certificate may exercise such
Warrants by:

     

    (i)    
providing
written notice of such election (“Warrant Exercise Notice”) to exercise the
Warrant to the Warrant Agent at the address set forth in the Warrant Agreement,
“Re Calpine Corporation: Warrant Exercise”, by overnight courier, no later than
5:00 p.m. New York City time, on the Expiration Date, which Warrant Exercise
Notice shall substantially be in the form of an election to purchase Warrant
Shares set forth herein, properly completed and executed by the holder, such
written notice to be submitted by or through persons who are direct participants
in the Depositary;

     

    (ii)    
delivering
no later than 5:00 p.m. New York City time, on the business day immediately
prior to the Settlement Date, the Warrant Certificates evidencing such Warrants
to the Warrant Agent by book-entry transfer through the facilities of the
Depositary; and

     

    (iii)    
paying
the applicable Exercise Amount, together with any applicable taxes and
governmental charges.

     

    If less
than all of the Warrants evidenced by this Warrant Certificate are exercised at
any time prior to the Expiration Date, this Global Warrant Certificate shall be
endorsed to

     

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    evidence
the number of Warrants previously evidenced by this Warrant Certificate not so
exercised.

     

    No
adjustment shall be made for any cash dividends on any Shares issuable upon
exercise of this Warrant.  Any Warrants not exercised prior to the
Expiration Date shall become void and all rights thereunder and all rights in
respect thereof under the Warrant Agreement shall cease as of the Expiration
Date.

     

    The
Company shall not be required to issue fractional shares of Common Stock on
exercise of Warrants that evidence fractional Shares.

     

    The
Warrant Agreement provides that, in addition to certain adjustments to the
number of Warrant Shares into which a Warrant is exercisable and the Exercise
Price required to be made in certain circumstances, in the case of any
Transaction, the Company shall (or, in the case of any Non-Surviving
Transaction, the Company shall cause the other Person involved in such
Transaction to) execute and deliver to the Warrant Agent a written instrument
providing that (i) the Warrants evidenced hereby, if then outstanding, will be
exercisable thereafter, during the period the Warrants evidenced hereby shall be
exercisable as specified herein, only into the Substituted Property that would
have been receivable upon such Transaction by a holder of the number of shares
of Common Stock that would have been issued upon exercise of such Warrant if
such Warrant had been exercised in full immediately prior to such Transaction
(upon certain assumptions specified in the Warrant Agreement), assuming that the
Warrants evidenced hereby were exercisable at the time of such Transaction at
the Exercise Price as then in effect; and (ii) the rights and obligations of the
Company (or, in the case of any Non-Surviving Transaction, the other Person
involved in such Transaction) and the holders in respect of Substituted Property
shall be as nearly equivalent as may be practicable to the rights and
obligations of the Company and Holders in respect of Common Stock.

     

    This
Warrant Certificate, each Warrant evidenced thereby and the Warrant Agreement
shall be governed by and construed in accordance with the laws of the State of
New York.

     

    Each
Warrant holder, by its acceptance of any Warrant, acknowledges and agrees that
the Warrants (including any Warrant Shares issued upon exercise thereof) were
issued pursuant to an exemption from the registration requirement of Section 5
of the Securities Act provided by Section 1145 of the Bankruptcy Code, and to
the extent that a Warrant holder is an "underwriter" as defined in Section
1145(b)(1) of the Bankruptcy Code, such holder may not be able to sell or
transfer any Warrants or Warrant Shares in the absence of an effective
registration statement under the Securities Act or an exemption from
registration thereunder.

     

    So long
as the Depositary, or its nominee, is the registered owner of this Global
Warrant Certificate, the Depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the Warrants represented by this Global
Warrant Certificate for all purposes under the Warrant
Agreement.  Except as provided in the Warrant Agreement upon the
exchange of a beneficial interest in this Global Warrant Certificate for a
Definitive Warrant Certificate, owners of beneficial interests in this Global
Warrant Certificate will not be entitled to have any Warrants registered in
their names, and will not receive or be entitled to receive physical
delivery

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

     of
any such Warrants as Definitive Warrant Certificates and will not be considered
the owners or holders thereof under the Warrants or the Warrant Agreement.
Neither the Company nor the Warrant Agent, in its capacity as registrar for such
Warrants, will have any responsibility or liability for any aspect of the
records relating to beneficial interests in this Global Warrant Certificate or
for maintaining, supervising or reviewing any records relating to such
beneficial interests.

     

    [Balance
of page intentionally remains blank]

     

     

    
      
        
          
             

          

           

        

        
           

          
            

          

        

        
           

        

      

    

     

    Schedule
I

     

    SCHEDULE
OF

    INCREASES
OF AND DECREASES TO AMOUNT OF

    WARRANTS
EVIDENCED

    BY

    GLOBAL
WARRANT CERTIFICATE

    EVIDENCING

    SERIES A
WARRANTS TO PURCHASE COMMON STOCK

     

     

     

    
      	
              Date
      of Change

            	
              Amount of Increase

              (Decrease) of

              Warrants
      Evidenced

            	
              Resulting Amount of

              Warrants
      Evidenced

            	
              Signature of

              Authorized
      Officerd848949.htm

    

      Exhibit
4.1

       

       

      STOCKHOLDERS
RIGHTS AGREEMENT

       

      This
Stockholders Rights Agreement (this “Rights
Agreement”) is made and entered into as of
[               
], 2008, by and between Omega Navigation Enterprises, Inc., a Marshall Islands
corporation (the “Company”),
and Computershare Trust Company, N.A., as Rights Agent (the “Rights
Agent”).

       

      WHEREAS,
the Board of Directors of the Company (the “Board”)
has (a) authorized and declared a dividend of one right (the “Right”)
for each share of the Company’s common stock, par value U.S. $.01 per share (the
“Common
Stock”) held of record as of the Close of Business (as hereinafter
defined) on March 7, 2008 (the “Record
Date”) and (b) has further authorized the issuance of one Right in
respect of each share of Common Stock that shall become outstanding (i) at any
time between the Record Date and the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date (as such terms are hereinafter
defined) or (ii) upon the exercise or conversion, prior to the earlier of the
Redemption Date or the Final Expiration Date, of any option or other security
exercisable for or convertible into shares of Common Stock, which option or
other such security is outstanding on the Distribution Date; and

       

      WHEREAS,
each Right represents the right of the holder thereof to purchase one
one-thousandth of a share of Series A Participating Preferred Stock (as such
number may hereafter be adjusted pursuant to the provisions hereof), upon the
terms and subject to the conditions set forth herein, having the rights,
preferences and privileges set forth in the Certificate of Designations of
Series A Participating Preferred Stock, attached hereto as Exhibit
A.

       

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

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
         

      

      1.           Certain
Definitions.

       

      “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% or more of the shares of
Common Stock then outstanding, but shall not include the Company, any Subsidiary
of the Company or any employee benefit plan of the Company or of any Subsidiary
of the Company, or any entity holding shares of Common Stock for or pursuant to
the terms of any such plan.  Notwithstanding the foregoing, no Person
shall be deemed to be an Acquiring Person as the result of an acquisition of
shares of Common Stock by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares beneficially owned by
such Person to 15% or more of the shares of Common Stock of the Company then
outstanding; provided, however, that a
Person who (i) becomes the Beneficial Owner of 15% or more of the shares of
Common Stock of the Company then outstanding by reason of share purchases by the
Company and (ii) then after such share purchases by the Company, becomes the
Beneficial Owner of any additional shares of Common Stock of the Company (other
than pursuant to a dividend or distribution paid or made by the Company on the
outstanding shares of Common Stock in shares of Common Stock or pursuant to a
split or subdivision of the outstanding
shares of Common Stock), such Person shall be deemed to be an Acquiring Person
unless upon becoming the Beneficial Owner of such additional shares of Common
Stock of the Company such Person does not beneficially own 15% or more of the
shares of Common Stock of the Company then
outstanding.  Notwithstanding the foregoing: (i) if the
Company’s Board of Directors determines in good faith that a Person who would
otherwise be an “Acquiring Person,” as defined herein, has become such
inadvertently (including, without limitation, because (A) such Person was
unaware that it beneficially owned a percentage of the shares of Common Stock
that would otherwise cause such Person to be an “Acquiring Person,” as defined
herein, or (B) such Person was aware of the extent of the shares of Common Stock
it beneficially owned but had no actual knowledge of the consequences of such
beneficial ownership under this Agreement) and without any intention of changing
or influencing control of the Company, and if such Person divested or divests as
promptly as practicable a sufficient number of shares of Common Stock so that
such Person would no longer be an “Acquiring Person,” as defined herein, then
such Person shall not be deemed to be or to have become an “Acquiring Person”
for any purposes of this Agreement; and (ii) if, as of the date hereof, any
Person is the Beneficial Owner of 15% or more of the shares of Common Stock
outstanding, such Person shall not be or become an “Acquiring Person,” as
defined herein, unless and until such time as such Person shall become the
Beneficial Owner of additional shares of Common Stock in an amount equal to 10%
of the Company’s outstanding common stock, other than pursuant to a grant under
a Company equity incentive plan, a dividend or distribution paid or made by the
Company on the outstanding shares of Common Stock in shares of Common Stock or
pursuant to a split or subdivision of the outstanding shares of Common Stock,
unless, upon becoming the Beneficial Owner of such additional shares of Common
Stock, such Person is not then the Beneficial Owner of 15% or more of the shares
of Common Stock then outstanding.

       

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

       

      “Affiliate” and “Associate” shall have
the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the “Exchange Act” as hereinafter defined, 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” any
securities:

       

      
        	
                 
      

              	
                (i)

              	
                which
      such Person or any of such Person’s Affiliates or Associates beneficially
      owns, directly or indirectly, for purposes of Section 13(d) of the
      Exchange Act and Rule 13d-3 thereunder (or any comparable or successor law
      or regulation);

              

      

       

      
        	
                 
      

              	
                (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;

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      
        	 	 (iii)	 provided, however, that a
      Person shall not be deemed pursuant to this subsection (ii)(A) to be the
      Beneficial Owner of, or to beneficially own, (1) 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 (2) securities which
      a Person or any of such Person’s Affiliates or Associates may be deemed to
      have the right to acquire pursuant to any merger or other acquisition
      agreement between the Company and such Person (or one or more of its
      Affiliates or Associates) if such agreement has been approved by the Board
      of Directors of the Company prior to there being an Acquiring Person; 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 under this subsection (ii)(B) 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 of the Exchange Act and (2) is not
      also then reportable on Schedule 13D under the Exchange Act (or any
      comparable or successor report); or
	 	 	 
	
                 
      

              	
                (iv)

              	
                which
      are beneficially owned, directly or indirectly, by any other Person (or
      any Affiliate or Associate thereof) with which such Person or any of such
      Person’s Affiliates or Associates has any agreement, arrangement or
      understanding, whether or not in writing (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 to
      subsection (ii)(B) above) or disposing of any securities of the Company;
      provided,
      however,
      that in no case shall an officer or director of the Company be deemed (x)
      the Beneficial Owner of any securities beneficially owned by another
      officer or director of the Company solely by reason of actions undertaken
      by such persons in their capacity as officers or directors of the Company
      or (y) the Beneficial Owner of securities held of record by the trustee of
      any employee benefit plan of the Company or any Subsidiary of the Company
      for the benefit of any employee of the Company or any Subsidiary of the
      Company, other than the officer or director, by reason of any influence
      that such officer or director may have over the voting of the securities
      held in the plan.

              

      

      
         

        “Business Day” shall
mean any day other than a Saturday, Sunday or a day on which the New York Stock
Exchange is 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 time, on such date; provided, however, that if such
date is not a Business Day it shall mean 5:00 P.M., New York time, on the next
succeeding Business Day.

       

      “Common Stock” shall
have the meaning set forth in the preamble.  Common Stock 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 Stock
Equivalents” shall have the meaning set forth in Section 11(a)(iii)
hereof.

       

      “Company” shall have
the meaning set forth in the preamble, subject to the terms of Section
13(a)(iii)(c) hereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      “Current Per Share Market
Price” of any security (a “Security” for purposes of this definition),
for all computations other than those made pursuant to Section 11(a)(iii)
hereof, shall mean the average of the daily closing prices per share of such
Security for the thirty (30) consecutive Trading Days 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 any Security on any date shall be
deemed to be the average of the daily closing prices per share of such Security
for the ten (10) consecutive Trading Days immediately prior to such date; provided, however, that in the
event that the Current Per Share Market Price of the Security is determined
during a period following the announcement by the issuer of such Security of (i)
a dividend or distribution on such Security payable in shares of such Security
or securities convertible into such shares or (ii) any subdivision, combination
or reclassification of such Security, and prior to the expiration of the
applicable thirty (30) Trading Day or ten (10) Trading Day period, after the
ex-dividend date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in each such case, the
Current Per Share Market Price shall be appropriately adjusted to reflect the
current market price per share equivalent of such Security.  The
closing price for each day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the Security is not
listed or admitted to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the Security is
listed or admitted to trading or, if the Security is not listed or admitted to
trading on any national securities exchange, the last 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 by Nasdaq or such other
system then in use, or, if on any such date the Security is not quoted by any
such organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Security selected by the
Board of Directors of the Company.  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.  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 shares of Common Stock as
determined pursuant to this definition, as appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof, multiplied by 1000.  If the Security is not 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 and shall be conclusive for all purposes.

      
         

      

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

       

      “Distribution Date”
shall mean the earlier of (i) the Close of Business on the tenth day after the
“Shares Acquisition Date” as hereinafter defined (or, if the tenth day after the
Shares Acquisition Date occurs before the Record Date, the Close of Business on
the Record Date) or (ii) the Close of Business on the tenth Business Day (or
such later date as may be determined by action of the Company’s Board of
Directors) after the date that a tender or exchange offer by any Person (other
than the Company, any Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan) is first published or sent or given within the meaning of Rule
14d-2(a) of the General Rules and Regulations under the Exchange Act, if,
assuming the successful consummation thereof, such Person would be an Acquiring
Person.

       

      “Equivalent Shares”
shall mean Preferred Shares and any other class or series of capital stock of
the Company which is entitled to the same rights, privileges and preferences as
the Preferred Shares.

       

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

       

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

       

      “Exercise Price” shall
have the meaning set forth in Section 4(a) hereof.

       

      “Expiration Date”
shall mean the earliest to occur of: (i) the Close of Business on the Final
Expiration Date, (ii) the Redemption Date, or (iii) the time at which the Board
of Directors orders the exchange of the Rights as provided in Section 24
hereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      “Final Expiration
Date” shall mean March 7, 2018.

       

      “Nasdaq” shall mean
the National Association of Securities Dealers, Inc. Automated Quotations
System.

       

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

       

      “Post-event
Transferee” shall have the meaning set forth in Section 7(e)
hereof.

       

      “Preferred Shares”
shall mean shares of Series A Participating Preferred Stock, U.S. $0.01 par
value, of the Company.

       

      “Pre-event Transferee”
shall have the meaning set forth in Section 7(e) hereof.

       

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

       

      “Record Date” shall
have the meaning set forth in the recitals at the beginning of this Rights
Agreement.

       

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

       

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

       

      “Rights Agent” shall
mean Computershare Trust Company, N.A., or its successor or replacement as
provided in Sections 19 and 21 hereof.

       

      “Rights Certificate”
shall mean a certificate substantially in the form attached hereto as Exhibit
B.

       

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

       

      “Section 13 Event”
shall mean any event described in clause (i), (ii) or (iii) of Section 13(a)
hereof.

       

      “Securities Act” shall
mean the Securities Act of 1933, as amended.

       

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

       

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

       

      “Subsidiary” of any
Person shall mean any corporation or other entity of which an amount of voting
securities sufficient to elect a majority of the directors or Persons having
similar authority of such corporation or other entity is beneficially owned,
directly or indirectly, by such Person, or any corporation or other entity
otherwise controlled by such Person.

       

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

       

      “Summary of Rights”
shall mean a summary of this Agreement substantially in the form attached hereto
as Exhibit
C.

       

      “Total Exercise Price”
shall have the meaning set forth in Section 4(a) hereof.

       

      “Trading Day” shall
mean a day on which the principal national securities exchange on which a
referenced security is listed or admitted to trading is open for the transaction
of business or, if a referenced security is not listed or admitted to trading on
any national securities exchange, a Business Day.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      A “Triggering Event”
shall be deemed to have occurred upon any Person becoming an Acquiring
Person.

       

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

       

      3.           Issuance of Rights
Certificates.

       

      (a)           Until
the Distribution Date, (i) the Rights will be evidenced (subject to the
provisions of Sections 3(b) and 3(c) hereof) by the certificates for shares of
Common Stock registered in the names of the holders thereof (which certificates
shall also be deemed to be Rights Certificates) and not by separate Rights
Certificates and (ii) the right to receive Rights Certificates will be
transferable only in connection with the transfer of shares of Common
Stock.  Until the earlier of the Distribution Date or the Expiration
Date, the surrender for transfer of certificates for shares of Common Stock
shall also constitute the surrender for transfer of the Rights associated with
the shares of Common Stock represented thereby.  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, postage-prepaid
mail, to each record holder of shares of Common Stock as of the Close of
Business on the Distribution Date, at the address of such holder shown on the
records of the Company, a Rights Certificate evidencing one Right for each share
of Common Stock so held, subject to adjustment as provided herein.  In
the event that an adjustment in the number of Rights per share of Common Stock
has been made pursuant to Section 11 hereof, then at the time of distribution of
the Rights Certificates, the Company shall make the necessary and appropriate
rounding adjustments (in accordance with Section 14(a) hereof) so that Rights
Certificates representing only whole numbers of Rights are distributed and cash
is paid in lieu of any fractional Rights.  As of the Distribution
Date, the Rights will be evidenced solely by such Rights Certificates and may be
transferred by the transfer of the Rights Certificates as permitted hereby,
separately and apart from any transfer of shares of Common Stock, and the
holders of such Rights Certificates as listed in the records of the Company or
any transfer agent or registrar for the Rights shall be the record holders
thereof.

       

      (b)           On
the Record Date or as soon as practicable thereafter, the Company will send a
copy of the Summary of Rights by first-class, postage-prepaid mail, to each
record holder of shares of Common Stock as of the Close of Business on the
Record Date, at the address of such holder shown on the records of the Company’s
transfer agent and registrar.  With respect to certificates for shares
of Common Stock outstanding as of the Record Date, until the Distribution Date,
the Rights will be evidenced by such certificates registered in the names of the
holders thereof
together with the Summary of Rights.  Until the Distribution Date (or,
if earlier, the Expiration Date), the surrender for transfer of any certificate
for shares of Common Stock outstanding on the Record Date, with or without a
copy of the Summary of Rights, shall also constitute the transfer of the Rights
associated with the shares of Common Stock represented thereby.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (c)           Unless
the Board of Directors by resolution adopted at or before the time of the
issuance of any shares of Common Stock specifies to the contrary, Rights shall
be issued in respect of all shares of Common Stock that are issued after the
Record Date but prior to the earlier of the Distribution Date or the Expiration
Date or, in certain circumstances provided in Section 22 hereof, after the
Distribution Date.  Certificates representing such shares of Common
Stock shall also be deemed to be certificates for Rights, and shall bear the
following legend:

       

      THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS
SET FORTH IN A STOCKHOLDER RIGHTS AGREEMENT BETWEEN OMEGA NAVIGATION
ENTERPRISES, INC. AND COMPUTERSHARE TRUST COMPANY, N.A., AS THE RIGHTS AGENT,
DATED AS OF
[                  
], 2008, (THE “RIGHTS AGREEMENT”), THE TERMS OF WHICH ARE HEREBY INCORPORATED
HEREIN BY REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE
OFFICES OF OMEGA NAVIGATION ENTERPRISES, 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.  OMEGA NAVIGATION ENTERPRISES, 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
SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO
IS, WAS OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON
BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BECOME NULL AND
VOID.

       

      With
respect to such certificates containing the foregoing legend, until the earlier
of (i) the Distribution Date or (ii) the Expiration Date, the Rights associated
with the shares of Common Stock 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
shares of Common Stock represented thereby.

       

      (d)           In
the event that the Company purchases or acquires any shares of Common Stock
after the Record Date but prior to the Distribution Date, any Rights associated
with such shares of Common Stock shall be deemed canceled and retired so that
the Company shall not be entitled to exercise any Rights associated with the
shares of Common Stock which are no longer outstanding.

       

      4.           Form of Rights
Certificates.

       

                  
(a)           The Rights
Certificates (and the forms of election to purchase shares of Common Stock and
of assignment to be printed on the reverse thereof) shall be substantially in
the form of Exhibit
B hereto and may have such marks of identification or designation and
such legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange or a national market system, on which the Rights may from time to time
be listed or included, or to conform to usage.  Subject to the
provisions of Section 11 and Section 22 hereof, the Rights Certificates,
whenever distributed, shall be dated as of the Record Date (or in the case of
Rights issued with respect to shares of Common Stock issued by the Company after
the Record Date, as of the date of issuance of such shares of Common Stock) and
on their face shall entitle the holders thereof to purchase such number of one-
thousandths of a Preferred Share as shall be set forth therein at the price set
forth therein (such exercise price per one one-thousandth of a Preferred Share
being hereinafter referred to as the “Exercise Price” and
the aggregate Exercise Price of all Preferred Shares issuable upon exercise of
one Right being hereinafter referred to as the “Total Exercise
Price”), but the number and type of securities purchasable upon the
exercise of each Right and the Exercise Price shall be subject to adjustment as
provided herein.

       

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

       

      THE
RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY
A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF
AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT).  ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS
REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN
SECTION 7(e) OF THE RIGHTS AGREEMENT.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        5.           Countersignature and
Registration.

         

      

      (a)           The
Rights Certificates shall be executed on behalf of the Company by its Chairman
of the Board, its Chief Executive Officer, its Chief Financial Officer, its
President or any Vice President, either manually or by facsimile signature, and
by the Secretary or an

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

       

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

       

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

       

      (a)           Subject
to the provisions of Sections 7(e), 14 and 24 hereof, at any time after the
Close of Business on the Distribution Date, and at or prior to the Close of
Business on the Expiration Date, any Rights Certificate or Rights Certificates
may be transferred, split up, combined or exchanged for another Rights
Certificate or Rights Certificates, entitling the registered holder to purchase
a like number of one-thousandths of a Preferred Share (or, following a
Triggering Event, other securities, cash or other assets, as the case may be) as
the Rights Certificate or Rights Certificates surrendered then entitled such
holder to purchase.  Any registered holder desiring to transfer, split
up, combine or exchange any Rights Certificate or Rights Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Rights Certificates to be transferred, split up, combined
or exchanged at the office of the Rights Agent designated for such
purpose.  Neither the Rights Agent nor the Company shall be obligated
to take any action whatsoever with respect to the transfer of any such
surrendered Rights Certificate until the registered holder shall have completed
and signed the certificate contained in the form of assignment on the reverse
side of such Rights Certificate and shall have provided such additional evidence
of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably
request.  Thereupon the Rights Agent shall, subject to Sections 7(e),
14 and 24 hereof, countersign and deliver to the person entitled thereto a
Rights Certificate or Rights Certificates, as the case may be, as so
requested.  The Company may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights Certificates.

       

      (b)           Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory
to them of the loss, theft, destruction or mutilation of a Rights Certificate,
and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, and, 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 Rights Certificate if
mutilated, the Company will make and deliver a new Rights Certificate of like
tenor to the Rights Agent for delivery to the registered holder in lieu of the
Rights Certificate so lost, stolen, destroyed or mutilated.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

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

       

      (a)           Subject
to Sections 7(e), 23(b) and 24(b) hereof, the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the Distribution Date and
prior to the Close of Business on the Expiration Date by surrender of the Rights
Certificate, with the form of election to purchase on the reverse side thereof
duly executed, to the Rights Agent at the office of the Rights Agent designated
for such purpose, together with payment of the Exercise Price for each
one-thousandth of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) as to which the Rights are
exercised.

       

      (b)           The
Exercise Price for each one-thousandth of a Preferred Share issuable pursuant to
the exercise of a Right shall initially be sixty U.S. dollars (U.S. $60), shall
be subject to adjustment from time to time as provided in Sections 11 and 13
hereof and shall be payable in lawful money of the United States of America in
accordance with paragraph (c) below.

       

      (c)           Upon
receipt of a Rights Certificate representing exercisable Rights, with the form
of election to purchase duly executed, accompanied by payment of the Exercise
Price for the number of one-thousandths of a Preferred Share (or, following a
Triggering Event, other securities, cash or other assets as the case may be) to
be purchased and an amount equal to any applicable transfer tax required to be
paid by the holder of such Rights Certificate in accordance with Section 9(e)
hereof, the Rights Agent shall, subject to Section 20(k) hereof, thereupon
promptly (i) (A) requisition from any transfer agent of the Preferred Shares (or
make available, if the Rights Agent is the transfer agent for the Preferred
Shares) a certificate or certificates for the number of one-thousandths of a
Preferred Share (or, following a Triggering Event, other securities, cash or
other assets as the case may be) to be purchased and the Company hereby
irrevocably authorizes its transfer agent to comply with all such requests or
(B) if the Company shall have elected to deposit the total number of
one-thousandths of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) issuable upon exercise of
the Rights hereunder with a depositary agent, requisition from the depositary
agent depositary receipts representing such number of one-thousandths of a
Preferred Share (or, following a Triggering Event, other securities, cash or
other assets as the case may be) as are to be purchased (in which case
certificates for the Preferred Shares (or, following a Triggering Event, other
securities, cash or other assets as the case may be) represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company hereby directs the depositary agent to comply with such request,
(ii) when appropriate, 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) after receipt of such certificates or depositary receipts, cause
the same to be delivered to or upon the order of the registered holder of such
Rights Certificate, registered
in such name or names as may be designated by such holder and (iv) when
appropriate, after receipt thereof, deliver such cash to or upon the order of
the registered holder of such Rights Certificate.  The payment of the
Exercise Price (as such amount may be reduced (including to zero) pursuant to
Section 11(a)(iii) hereof) and an amount equal to any applicable transfer tax
required to be paid by the holder of such Rights Certificate in accordance with
Section 9(e) hereof, may be made in cash or by certified bank check, cashier’s
check or bank draft payable to the order of the Company.  In the event
that the Company is obligated to issue securities of the Company other than
Preferred Shares, pay cash and/or distribute other property pursuant to Section
11(a) hereof, the Company will make all arrangements necessary so that such
other securities, cash and/or other property are available for distribution by
the Rights Agent, if and when appropriate.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

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

       

      (e)           Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence
of a Triggering Event, any Rights beneficially owned by (i) an Acquiring Person
or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such (a “Post-Event
Transferee”), (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Company’s Board of
Directors has determined is part of a plan, arrangement or understanding which
has as a primary purpose or effect the avoidance of this Section 7(e) (a “Pre-Event
Transferee”) or (iv) any subsequent transferee receiving transferred
Rights from a Post-Event Transferee or a Pre-Event Transferee, either directly
or through one or more intermediate transferees, shall become null and void
without any further action and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise.  The Company shall use all reasonable efforts
to ensure that the provisions of this Section 7(e) and Section 4(b) hereof are
complied with, but shall have no liability to any holder of Rights Certificates
or to any other Person as a result of its failure to make any determinations
with respect to an Acquiring Person or any of such Acquiring Person’s
Affiliates, Associates or transferees hereunder.

       

      (f)           Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the
Company shall be obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall, in addition to having complied
with the requirements of Section 7(a), have (i) completed and signed the
certificate contained in the form of election to purchase set forth on the
reverse side of the Rights Certificate surrendered for such exercise and
(ii)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request.

       

      8.           Cancellation and Destruction
of Rights Certificates.  All Rights Certificates surrendered
for the purpose of exercise, transfer, split up, combination or exchange shall,
if surrendered to the Company or to any of its agents, be delivered to the
Rights Agent for cancellation or in canceled form, or, if surrendered to the
Rights Agent, shall be canceled by it, and no Rights 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 Rights Certificate purchased or acquired by the Company otherwise than upon
the exercise thereof.  The Rights Agent shall deliver all canceled
Rights Certificates to the Company, or shall, at the written request of the
Company, destroy such canceled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.

       

      9.           Reservation and Availability
of Preferred Shares.

       

      (a)           The
Company covenants and agrees that it will use its best efforts to cause to be
reserved and kept available out of its authorized and unissued Preferred Shares
not reserved for another purpose (and, following the occurrence of a Triggering
Event, out of its authorized and unissued shares of Common Stock and/or other
securities), the number of Preferred Shares (and, following the occurrence of
the Triggering Event, Common Stock and/or other securities) that will be
sufficient to permit the exercise in full of all outstanding
Rights.

       

      (b)           If
the Company shall hereafter list any of its Preferred Shares on a national
securities exchange, then so long as the Preferred Shares (and, following the
occurrence of a Triggering Event, shares of Common Stock and/or other
securities) issuable and deliverable upon exercise of the Rights may be listed
on such exchange, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable (but only to the extent that it
is reasonably likely that the Rights will be exercised), all shares reserved for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (c)           The
Company shall use its best efforts to (i) file, as soon as practicable following
the earliest date after the first occurrence of a Triggering Event in which the
consideration to be delivered by the Company upon exercise of the Rights is
described in Section 11(a)(ii) or Section 11(a)(iii) hereof, or as soon as is
required by law following the Distribution Date, as the case may be, a
registration statement under the Securities Act with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable after such
filing and (iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the earlier of (A) the date as of which the Rights are no longer exercisable for
such securities and (B) the date of expiration of the Rights.  The
Company may temporarily suspend, for a period not to exceed ninety (90) days
after the date set forth in clause (i) of the first sentence of this Section
9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective.  Upon any
such suspension, the Company shall issue a public announcement and notify the
Rights Agent that the exercisability
of the Rights has been temporarily suspended, as well as a public announcement
and notification to the Rights Agent at such time as the suspension is no longer
in effect.  The Company will also take such action as may be
appropriate under, or to ensure compliance with, the securities or “blue sky”
laws of the various states in connection with the exercisability of the
Rights.  Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction, unless the
requisite qualification in such jurisdiction shall have been obtained, or an
exemption therefrom shall be available, and until a registration statement has
been declared effective.

       

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

       

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

       

      10.           Record
Date.  Each Person in whose name any certificate for a number
of one-thousandths of a Preferred Share (or other securities of the Company) is
issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of Preferred Shares (or other securities of the
Company) represented thereon, and such certificate shall be dated, the date upon
which the Rights Certificate evidencing such Rights was duly surrendered and
payment of the Total Exercise Price with respect to which the Rights have been
exercised (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 are closed, such Person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated, the next
succeeding Business Day on which the transfer books of the Company are
open.  Prior to the exercise of the Rights evidenced thereby, the
holder of a Rights Certificate shall not be entitled to any rights of a holder
of Preferred Shares (or other securities of the Company) 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.

       

      11.           Adjustment of Exercise
Price, Number of Shares or Number of Rights.  The Exercise
Price, the number and kind of shares or other property 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)
Notwithstanding anything in this Agreement to the contrary, 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 (by
reverse stock split or otherwise) 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),
then, in each such event, except as otherwise provided in this Section 11 and
Section 7(e) hereof: (1) the Exercise Price in effect at the time of the record
date for such dividend or of the effective date of such subdivision, combination
or reclassification shall be adjusted so that the Exercise Price thereafter
shall equal the result obtained by dividing the Exercise Price in effect
immediately prior to such time by a fraction (the “Adjustment
Fraction”), the numerator of which shall be the total number of Preferred
Shares (or shares of capital stock issued in such reclassification of the
Preferred Shares) outstanding immediately following such time and the
denominator of which shall be the total number of Preferred Shares outstanding
immediately prior to such time; 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 such Right; and (2) the number of one-thousandths of a
Preferred Share (or share of such other capital stock) issuable upon the
exercise of each Right shall equal the number of one-thousandths of a Preferred
Share (or share of such other capital stock) as was issuable upon exercise of a
Right immediately prior to the occurrence of the event described in clauses
(A)-(D) of this Section 11(a)(i), multiplied by the Adjustment Fraction; provided, however, that, no
such adjustment shall be made pursuant to this Section 11(a)(i) to the extent
that there shall have simultaneously occurred an event described in clause (A),
(B), (C) or (D) of Section 11(n) with a proportionate adjustment being made
thereunder.  Each share of Common Stock that shall become outstanding
after an adjustment has been made pursuant to this Section 11(a)(i) shall have
associated with it the number of Rights, exercisable at the Exercise Price and
for the number of one-thousandths of a Preferred Share (or shares of such other
capital stock) as one share of Common Stock has associated with it immediately
following the adjustment made pursuant to this Section 11(a)(i).

       

      (ii)
Subject to Section 24 of this Agreement, in the event a Triggering Event shall
have occurred, then promptly following such Triggering Event each holder of a
Right, except as provided in Section 7(e) hereof, shall thereafter have the
right to receive for each Right, upon exercise thereof in accordance with the
terms of this Agreement and payment of the Exercise Price in effect immediately
prior to the occurrence of the Triggering Event, in lieu of a number of
one-thousandths of a Preferred Share, such number of shares of Common Stock of
the Company as shall equal the result obtained by multiplying the Exercise Price
in effect immediately
prior to the occurrence of the Triggering Event by the number of one-thousandths
of a Preferred Share for which a Right was exercisable (or would have been
exercisable if the Distribution Date had occurred) immediately prior to the
first occurrence of a Triggering Event, and dividing that product by 50% of the
Current Per Share Market Price for shares of Common Stock on the date of
occurrence of the Triggering Event; provided, however, that the
Exercise Price and the number of shares of Common Stock of the Company so
receivable upon exercise of a Right shall be subject to further adjustment as
appropriate in accordance with Section 11(e) hereof to reflect any events
occurring in respect of the shares of Common Stock of the Company after the
occurrence of the Triggering Event.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (iii) In
lieu of issuing shares of Common Stock in accordance with Section 11(a)(ii)
hereof, the Company may, if the Company’s Board of Directors determines that
such action is necessary or appropriate and not contrary to the interest of
holders of Rights and, in the event that the number of shares of Common Stock
which are authorized by the Company’s Certificate of Incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise of
the Rights are not sufficient to permit the exercise in full of the Rights, or
if any necessary regulatory approval for such issuance has not been obtained by
the Company, the Company shall: (A) determine the excess of (1) the value of the
shares of Common Stock issuable upon the exercise of a Right (the “Current Value”) over
(2) the Exercise Price (such excess, the “Spread”) and (B) with
respect to each Right, make adequate provision to substitute for such shares of
Common Stock, upon exercise of the Rights, (1) cash, (2) a reduction in the
Exercise Price, (3) other equity securities of the Company (including, without
limitation, shares or units of shares of any series of preferred stock which the
Company’s Board of Directors has deemed to have the same value as Common Stock
(such shares or units of shares of preferred stock are herein called “Common Stock
Equivalents”)), except to the extent that the Company has not obtained
any necessary stockholder or regulatory approval for such issuance, (4) debt
securities of the Company, except to the extent that the Company has not
obtained any necessary stockholder or regulatory approval for such issuance, (5)
other assets or (6) any combination of the foregoing, having an aggregate value
equal to the Current Value, where such aggregate value has been determined by
the Company’s Board of Directors based upon the advice of a nationally
recognized investment banking firm selected by the Company’s Board of Directors;
provided, however, if the
Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within thirty (30) days following the later of (x) the first
occurrence of a Triggering Event and (y) the date on which the Company’s right
of redemption pursuant to Section 23(a) expires (the later of (x) and (y) being
referred to herein as the “Section 11(a)(ii) Trigger
Date”), then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of the Exercise
Price, Common Stock (to the extent available), except to the extent that the
Company has not obtained any necessary stockholder or regulatory approval for
such issuance, and then, if necessary, cash, which shares and/or cash have an
aggregate
value equal to the Spread.  If the Company’s Board of Directors shall
determine in good faith that it is likely that sufficient additional Common
Stock could be authorized for issuance upon exercise in full of the Rights or
that any necessary regulatory approval for such issuance will be obtained, the
thirty (30) day period set forth above may be extended to the extent necessary,
but not more than ninety (90) days after the Section 11(a)(ii) Trigger Date, in
order that the Company may seek stockholder approval for the authorization of
such additional shares or take action to obtain such regulatory approval (such
period, as it may be extended, the “Substitution
Period”).  To the extent that the Company determines that some
action need be taken pursuant to the first and/or second sentences of this
Section 11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding Rights and (y)
may suspend the exercisability of the Rights until the expiration of the
Substitution Period in order to seek any authorization of additional shares, to
take any action to obtain any required regulatory approval and/or to decide the
appropriate form of distribution to be made pursuant to such first sentence and
to determine the value thereof.  In the event of any such suspension,
the Company shall issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement at
such time as the suspension is no longer in effect.  For purposes of
this Section 11(a)(iii), the value of the Common Stock shall be the Current Per
Share Market Price of the Common Stock on the Section 11(a)(ii) Trigger Date and
the value of any Common Stock Equivalent shall be deemed to have the same value
as the Common Stock on such date.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
         

      

      (b)           In
case the Company shall, at any time after the date of this Agreement, fix a
record date for the issuance of rights, options or warrants to all holders of
Preferred Shares entitling such holders (for a period expiring within forty-five
(45) calendar days after such record date) to subscribe for or purchase
Preferred Shares or Equivalent Shares or securities convertible into Preferred
Shares or Equivalent Shares at a price per share (or having a conversion price
per share, if a security convertible into Preferred Shares or Equivalent Shares)
less than the then Current Per Share Market Price of the Preferred Shares or
Equivalent Shares on such record date, then, in each such case, the Exercise
Price to be in effect after such record date shall be determined by multiplying
the Exercise Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the number of Preferred Shares and
Equivalent Shares (if any) outstanding on such record date, plus the number of
Preferred Shares or Equivalent Shares, as the case may be, which the aggregate
offering price of the total number of Preferred Shares or Equivalent Shares, as
the case may be, to be offered or issued (and/or the aggregate initial
conversion price of the convertible securities to be offered or issued) would
purchase at such current market price, and the denominator of which shall be the
number of Preferred Shares and Equivalent Shares (if any) outstanding on such
record date, plus the number of additional Preferred Shares or Equivalent
Shares, as the case may be, 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 a consideration part or all of which shall be in a form other
than cash, the value of such consideration shall be as determined
in good faith by the Company’s Board of Directors, whose determination shall be
described in a statement filed with the Rights Agent and shall be binding on the
Rights Agent and the holders of the Rights.  Preferred Shares and
Equivalent 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
Exercise Price shall be adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed.

       

      (c)           In
case the Company shall, at any time after the date of this Agreement, fix a
record date for the making of a distribution to all holders of the Preferred
Shares or of any class or series of Equivalent 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, if any, or a dividend
payable in Preferred Shares) or subscription rights, options or warrants
(excluding those referred to in Section 11(b)), then, in each such case, the
Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the Current Per Share Market
Price of a Preferred Share or an Equivalent Share on such record date, less the
fair market value per Preferred Share or Equivalent 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) of the portion of the
cash, assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to a Preferred Share or Equivalent
Share, as the case may be, and the denominator of which shall be such Current
Per Share Market Price of a Preferred Share or Equivalent Share on such record
date; 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.  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 Exercise Price shall be adjusted to be the
Exercise Price which would have been in effect if such record date had not been
fixed.

       

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

       

      (e)           If
as a result of an adjustment made pursuant to Section 11(a) or 13(a) hereof, the
holder of any Right thereafter exercised shall become entitled to receive any
shares of capital stock other than Preferred Shares, thereafter the number of
such other shares so receivable upon exercise of any Right and, if required, the
Exercise Price thereof, shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Preferred Shares contained in Sections 11(a),
11(b), 11(c), 11(d), 11(g), 11(h), 11(i), 11(j), 11(k) and 11(l), and the
provisions of Sections 7, 9, 10, 13 and 14 with respect to the Preferred Shares
shall apply on like terms to any such other shares.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

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

       

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

       

      (h)           The
Company may elect on or after the date of any adjustment of the Exercise Price
as a result of the calculations made in Section 11(b) or (c) to adjust the
number of Rights, in substitution for any adjustment in the number of Preferred
Shares 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-thousandths 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 hundred-thousandth) obtained by
dividing the Exercise Price in effect immediately prior to adjustment of the
Exercise Price by the Exercise Price in effect immediately after adjustment of
the Exercise 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 Exercise Price is
adjusted or any day thereafter, but, if the Rights Certificates have been
issued, shall be at least ten (10) days later than the date of the public
announcement.  If Rights Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(h), the Company
shall, as promptly as practicable, cause to be distributed to holders of record
of Rights Certificates on such record date Rights Certificates evidencing,
subject to Section 14 hereof, the additional Rights to which such holders shall
be entitled as a result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders prior to the date
of adjustment, and upon surrender thereof, if required by the Company, new
Rights Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment.  Rights Certificates so to be
distributed shall be issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the adjusted Exercise
Price) and shall be registered in the names of the holders of record of Rights
Certificates on the record date specified in the public
announcement.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

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

       

      (j)           Before
taking any action that would cause an adjustment reducing the Exercise Price
below the par or stated value, if any, of the number of one-thousandths of a
Preferred Share 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 as fully paid and nonassessable
shares such number of one-thousandths of a Preferred Share at such adjusted
Exercise Price.

       

      (k)           In
any case in which this Section 11 shall require that an adjustment in the
Exercise 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 number of
one-thousandths of a Preferred Share and other capital stock or securities of
the Company, if any, issuable upon such exercise over and above the number of
one-thousandths of a Preferred Share and other capital stock or securities of
the Company, if any, issuable upon such exercise on the basis of the Exercise
Price in effect prior to such adjustment; provided, however, that the Company
shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder’s right to receive such additional shares (fractional or
otherwise) upon the occurrence of the event requiring such
adjustment.

       

      (l)           Notwithstanding
anything in this Section 11 to the contrary, prior to the Distribution Date, the
Company shall be entitled to make such reductions in the Exercise 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 or
Common Stock, (ii) issuance wholly for cash of any Preferred Shares or Common
Stock at less than the current market price, (iii) issuance wholly for cash of
Preferred Shares or Common Stock or securities which by their terms are
convertible into or exchangeable for Preferred or Common Stock, (iv) stock
dividends or (v) issuance of rights, options or warrants referred to in this
Section 11, hereafter made by the Company to holders of its Preferred Shares or
Common Stock shall not be taxable to such stockholders.

       

      (m)           The
Company covenants and agrees that, after the Distribution Date, it will not,
except as permitted by Sections 23, 24 or 27 hereof, take (or permit to be
taken) any action if at the time such action is taken it is reasonably
foreseeable that such action will diminish substantially or otherwise eliminate
the benefits intended to be afforded by the Rights.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (n)           In
the event the Company shall at any time after the date of this Agreement (A)
declare a dividend on the Common Stock payable in shares of Common Stock, (B)
subdivide the outstanding shares of Common Stock, (C) combine the outstanding
Common Stock (by reverse stock split or otherwise) into a smaller number of
shares of Common Stock, or (D) issue any shares of its capital stock in a
reclassification of the shares of Common Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), then, in each such event,
except as otherwise
provided in this Section 11(a) and Section 7(e) hereof: (1) each share of Common
Stock (or shares of capital stock issued in such reclassification of the Common
Stock) outstanding immediately following such time shall have associated with it
the number of Rights as were associated with one share of Common Stock
immediately prior to the occurrence of the event described in clauses (A)-(D)
above; (2) the Exercise Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination or
reclassification shall be adjusted so that the Exercise Price thereafter shall
equal the result obtained by multiplying the Exercise Price in effect
immediately prior to such time by a fraction, the numerator of which shall be
the total number of shares of Common Stock outstanding immediately prior to the
event described in clauses (A)-(D) above, and the denominator of which shall be
the total number of shares of Common Stock outstanding immediately after such
event; 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 such Right; and (3) the number of one-thousandths of a
Preferred Share (or shares of such other capital stock) issuable upon the
exercise of each Right outstanding after such event shall equal the number of
one- thousandths of a Preferred Share (or shares of such other capital stock) as
were issuable with respect to one Right immediately prior to such
event.  Each share of Common Stock that shall become outstanding after
an adjustment has been made pursuant to this Section 11(n) shall have associated
with it the number of Rights, exercisable at the Exercise Price and for the
number of one-thousandths of a Preferred Share (or shares of such other capital
stock) as one share of Common Stock has associated with it immediately following
the adjustment made pursuant to this Section 11(n).  If an event
occurs which would require an adjustment under both this Section 11(n) and
Section 11(a)(ii) hereof, the adjustment provided for in this Section 11(n)
shall be in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii) hereof.

       

      12.           Certificate of Adjusted
Exercise Price or Number of Shares.  Whenever an adjustment is
made as provided in Sections 11 and 13 hereof, the Company shall promptly (a)
prepare a certificate setting forth such adjustment and a brief statement of the
facts accounting for such adjustment, (b) file with the Rights Agent and with
each transfer agent for the Preferred Shares a copy of such certificate and (c)
mail a brief summary thereof to each holder of a Rights Certificate in
accordance with Section 26 hereof.  Notwithstanding the foregoing
sentence, the failure of the Company to make such certification or give such
notice shall not affect the validity of such adjustment or the force or effect
of the requirement for such adjustment.  The Rights Agent shall be
fully protected in relying on any such certificate and on any adjustment
contained therein and shall not be deemed to have knowledge of such adjustment
unless and until it shall have received such certificate.

       

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

       

      (a)           In
the event that, following a Shares Acquisition Date, directly or
indirectly:

       

      (i) the
Company shall consolidate with, or merge with and into, any other Person (other
than a wholly-owned Subsidiary of the Company in a transaction the principal
purpose of which is to change the state of incorporation of the Company and
which complies with Section 11(m) hereof);

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (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
consolidation or merger and, in connection with such merger, all or part of the
shares of Common Stock shall be changed into or exchanged for stock or other
securities of any other person (or the Company); 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% or more of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company or one or more of its wholly owned Subsidiaries in one
or more transactions, each of which individually (and together) complies with
Section 11(m) hereof),

       

      then,
concurrent with and in each such case:

       

      (a)           each
holder of a Right (except as provided in Section 7(e) hereof) shall thereafter
have the right to receive, upon the exercise thereof, at a price equal to the
Total Exercise Price applicable immediately prior to the occurrence of the
Section 13 Event in accordance with the terms of this Agreement, such number of
validly authorized and issued, fully paid, nonassessable and freely tradeable
shares of Common Stock of the Principal Party (as hereinafter defined), free of
any liens, encumbrances, rights of first refusal or other adverse claims, as
shall be equal to the result obtained by dividing such Total Exercise Price by
50% of the Current Per Share Market Price of the shares of Common Stock of such
Principal Party on the date of consummation of such Section 13 Event, provided, however, that the
Exercise Price and the number of shares of Common Stock of such Principal Party
so receivable upon exercise of a Right shall be subject to further adjustment as
appropriate in accordance with Section 11(e) hereof;

       

      (b)           such
Principal Party shall thereafter be liable for, and shall assume, by virtue of
such Section 13 Event, all the obligations and duties of the Company pursuant to
this Agreement;

       

      (c)           the
term “Company” shall thereafter be deemed to refer to such Principal Party, it
being specifically intended that the provisions of Section 11 hereof shall apply
only to such Principal Party following the first occurrence of a Section 13
Event;

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (d)           such
Principal Party shall take such steps (including, but not limited to, the
reservation of a sufficient number of its Common Stock) in connection with the
consummation of any such transaction as may be necessary to ensure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to its shares of Common Stock thereafter deliverable upon the
exercise of the Rights; and

       

      (e)           upon
the subsequent occurrence of any consolidation, merger, sale or transfer of
assets or other extraordinary transaction in respect of such Principal Party,
each holder of a Right shall thereupon be entitled to receive, upon exercise of
a Right and payment of the Total Exercise Price as provided in this Section
13(a), such cash, shares, rights, warrants and other property which such holder
would have been entitled to receive had such holder, at the time of such
transaction, owned the shares of Common Stock of the Principal Party receivable
upon the exercise of such Right pursuant to this Section 13(a), and such
Principal Party shall take such steps (including, but not limited to,
reservation of shares of stock) as may be necessary to permit the subsequent
exercise of the Rights in accordance with the terms hereof for such cash,
shares, rights, warrants and other property.

       

      (f)           For
purposes hereof, the “earning power” of the Company and its Subsidiaries shall
be determined in good faith by the Company’s Board of Directors on the basis of
the operating earnings of each business operated by the Company and its
Subsidiaries during the three fiscal years preceding the date of such
determination (or, in the case of any business not operated by the Company or
any Subsidiary during three full fiscal years preceding such date, during the
period such business was operated by the Company or any
Subsidiary).

       

      (b)           For
purposes of this Agreement, the term “Principal Party”
shall mean:

       

      (i) in
the case of any transaction described in clause (i) or (ii) of Section 13(a)
hereof: (A) the Person that is the issuer of the securities into which the
shares of Common Stock are converted in such merger or consolidation, or, if
there is more than one such issuer, the issuer the shares of Common Stock of
which have the greatest aggregate market value of shares outstanding, or (B) if
no securities are so issued, (x) the Person that is the other party to the
merger, if such Person survives said merger, or, if there is more than one such
Person, the Person the shares of Common Stock of which have the greatest
aggregate market value of shares
outstanding or (y) if the Person that is the other party to the merger does not
survive the merger, the Person that does survive the merger (including the
Company if it survives) or (z) the Person resulting from the consolidation;
and

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (ii) in
the case of any transaction described in clause (iii) of Section13 (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, or, if
more than one Person that is a party to such transaction or transactions
receives the same portion of the assets or earning power so transferred and each
such portion would, were it not for the other equal portions, constitute the
greatest portion of the assets or earning power so transferred, or if the Person
receiving the greatest portion of the assets or earning power cannot be
determined, whichever of such Persons is the issuer of shares of Common Stock
having the greatest aggregate market value of shares outstanding; provided, however, that in any
such case described in the foregoing clause (b)(i) or (b)(ii), if the shares of
Common Stock of such Person are not at such time or have not been continuously
over the preceding 12-month period registered under Section 12 of the Exchange
Act, then (1) if such Person is a direct or indirect Subsidiary of another
Person the shares of Common Stock of which are and have been so registered, the
term “Principal Party” shall refer to such other Person, or (2) if such Person
is a Subsidiary, directly or indirectly, of more than one Person, the Common
Stock of which are and have been so registered, the term “Principal Party” shall
refer to whichever of such Persons is the issuer of shares of Common Stock
having the greatest aggregate market value of shares outstanding, or (3) if such
Person is owned, directly or indirectly, by a joint venture formed by two or
more Persons that are not owned, directly or indirectly by the same Person, the
rules set forth in clauses (1) and (2) above shall apply to each of the owners
having an interest in the venture as if the Person owned by the joint venture
was a Subsidiary of both or all of such joint venturers, and the Principal Party
in each such case shall bear the obligations set forth in this Section 13 in the
same ratio as its interest in such Person bears to the total of such
interests.

       

      (c)           The
Company shall not consummate any Section 13 Event unless the Principal Party
shall have a sufficient number of authorized shares of Common Stock that have
not been issued or reserved for issuance to permit the exercise in full of the
Rights in accordance with this Section 13 and unless prior thereto the Company
and such issuer shall have executed and delivered to the Rights Agent a
supplemental agreement confirming that such Principal Party shall, upon
consummation of such Section 13 Event, assume this Agreement in accordance with
Sections 13(a) and 13(b) hereof, that all rights of first refusal or preemptive
rights in respect of the issuance of shares of Common Stock of such Principal
Party upon exercise of outstanding Rights have been waived, that there are no
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 and that such transaction shall not result in a default by such Principal
Party under this Agreement, and further providing that, as soon as practicable
after the date of such Section 13 Event, such Principal Party will:

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

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

       

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

       

      (iii)
deliver to holders of the Rights historical financial statements for such
Principal Party which comply in all respects with the requirements for
registration on Form F-1 (or any successor form) under the Exchange
Act.

       

      In the
event that at any time after the occurrence of a Triggering Event some or all of
the Rights shall not have been exercised at the time of a transaction described
in this Section 13, the Rights which have not theretofore been exercised shall
thereafter be exercisable in the manner described in Section 13(a) (without
taking into account any prior adjustment required by Section
11(a)(ii)).

       

      (d)           In
case the “Principal Party” for purposes of Section 13(b) hereof has provision in
any of its authorized securities or in its certificate of incorporation or
by-laws or other instrument governing its corporate affairs, which provision
would have the effect of (i) causing such Principal Party to issue (other than
to holders of Rights pursuant to Section 13 hereof), in connection with, or as a
consequence of, the consummation of a Section 13 Event, shares of Common Stock
or Equivalent Shares of such Principal Party at less than the then Current Per
Share Market Price thereof or securities exercisable for, or convertible into,
shares of Common Stock or Equivalent Shares of such Principal Party at less than
such then Current Per Share Market Price, or (ii) providing for any special
payment, tax or similar provision in connection with the issuance of the shares
of Common Stock of such Principal Party pursuant to the provisions of Section 13
hereof, then, in such event, the Company hereby agrees with each holder of
Rights that it shall not consummate any such transaction unless prior thereto
the Company and such Principal Party shall have executed and delivered to the
Rights Agent a supplemental agreement providing that the provision in question
of such Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with or as a consequence of, the consummation of
the proposed transaction.

       

      (e)           The
Company covenants and agrees that it shall not, at any time after the
Distribution Date, effect or permit to occur any Section 13 Event, if (i) at the
time or immediately after such Section 13 Event there are any rights, warrants
or other instruments or securities outstanding or agreements in effect which
would substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights, (ii) prior to, simultaneously with or immediately after
such Section 13 Event, the stockholders of the Person who constitutes, or would
constitute, the “Principal Party” for purposes of Section 13(b) hereof shall
have received a distribution
of Rights previously owned by such Person or any of its Affiliates or Associates
or (iii) the form or nature of organization of the Principal Party would
preclude or limit the exercisability of the Rights.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (f)           The
provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.

       

      14.           Fractional Rights and
Fractional Shares.

       

      (a)           The
Company shall not be required to issue fractions of Rights or to distribute
Rights Certificates which evidence fractional Rights.  In lieu of such
fractional Rights, there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right.  For the purposes of this Section 14(a), the
current market value of a whole Right shall be the closing price of the Rights
for the Trading Day immediately prior to the date on which such fractional
Rights would have been otherwise issuable, as determined pursuant to this
Agreement.

       

      (b)           The
Company shall not be required to issue fractions of Preferred Shares (other than
fractions that are integral multiples of one one-thousandth of a Preferred
Share) upon exercise of the Rights or to distribute certificates which evidence
fractional Preferred Shares (other than fractions that are integral multiples of
one one-thousandth of a Preferred Share).  Interests in fractions of
Preferred Shares in integral multiples of one one-thousandth of a Preferred
Share may, at the election of the Company, be evidenced by depositary receipts,
pursuant to an appropriate agreement between the Company and a depositary
selected by it; provided, that such agreement shall provide that the holders of
such depositary receipts shall have all the rights, privileges and preferences
to which they are entitled as beneficial owners of the Preferred Shares
represented by such depositary receipts.  In lieu of fractional
Preferred Shares that are not integral multiples of one one-thousandth of a
Preferred Share, the Company shall pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market value of a Preferred
Share.  For purposes of this Section 14(b), the current market value
of a Preferred Share shall be one thousand times the closing price of a share of
Common Stock (as determined pursuant to the terms hereof) for the Trading Day
immediately prior to the date of such exercise.

       

      (c)           The
Company shall not be required to issue fractions of shares of Common Stock or to
distribute certificates which evidence fractional shares of Common Stock upon
the exercise or exchange of Rights.  In lieu of such fractional shares
of Common Stock, the Company shall pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market value of a share of
Common Stock.  For purposes of this Section 14(c), the current market
value of a share of Common Stock shall be the closing price of a share of Common
Stock (as determined pursuant to the terms hereof) for the Trading Day
immediately prior to the date of such exercise.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (d)           The
holder of a Right by the acceptance of the Right expressly waives his or her
right to receive any fractional Rights or any fractional shares (other than
fractions that are integral multiples of one one-thousandth of a Preferred
Share) upon exercise of a Right.

       

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

       

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

       

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

       

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

       

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

       

      17.           Rights Certificate Holder
Not Deemed a Stockholder.  No holder, as such, of any Rights
Certificate shall be entitled to vote, receive dividends or be deemed for any
purpose to be 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 Rights
Certificate be construed to confer upon the holder of any Rights Certificate, as
such, any of the rights of a stockholder of the Company or any right to vote for
the election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting stockholders (except as provided in Section 25 hereof), or to
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in
accordance with the provisions hereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      18.           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.  The Company also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability or expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim of
liability in the premises.  In no event will the Rights Agent be
liable for special, indirect, incidental or consequential loss or damage of any
kind whatsoever, even if the Rights Agent has been advised of the possibility of
such loss or damage.

       

      (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 Rights Certificate or
certificate for the Preferred Shares or shares of Common Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other paper or document reasonably 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.

       

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

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

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

       

      (a)           The
Rights Agent may consult with legal counsel (who may be legal counsel for the
Company), and the written advice or 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 written advice or
opinion.

       

      (b)           Whenever
in the performance of its duties under this Agreement the Rights Agent shall
deem it necessary or desirable that any fact or matter (including, without
limitation, the identity of any Acquiring Person and the determination of
Current Per Share Market Price) be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be deemed to
be conclusively proved and established by a certificate signed by any one of the
Chairman of the Board, the Chief Executive Officer, the President, any Vice
President, the Chief Financial Officer, the Secretary or any Assistant Secretary
of the Company and delivered to the Rights Agent; and such certificate shall be
full authorization to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance upon such
certificate.

       

      (c)           The
Rights Agent shall be liable hereunder 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 Rights 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
Rights Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or condition contained
in this Agreement or in any Rights Certificate; nor shall it be responsible for
any change in the exercisability of the Rights or any adjustment in the terms of
the Rights (including the manner, method or amount thereof) provided for in
Sections 3, 11, 13, 23 or 24, or the ascertaining of the existence of facts that
would require any such change or adjustment (except with respect to the exercise
of Rights evidenced by Rights Certificates after receipt by the Rights Agent of
a certificate furnished pursuant to Section 12 describing such change or
adjustment); 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 to be issued pursuant to this
Agreement or any Rights Certificate or as to whether any Preferred Shares will,
when 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 Chief Financial Officer, the
President, any Vice President, the Secretary or any Assistant Secretary of the
Company, and to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered by
it in good faith in accordance with instructions of any such officer or for any
delay in acting while waiting for those instructions.  Any application
by the Rights Agent for written instructions from the Company may, at the option
of the Rights Agent, set forth in writing any action proposed to be taken or
omitted by the Rights Agent under this Rights Agreement and the date on and/or
after which such action shall be taken or such omission shall be
effective.  The Rights Agent shall not be liable for any action taken
by, or omission of, the Rights Agent in accordance with a proposal included in
any such application on or after the date specified in such application (which
date shall not be less than five (5) Business Days after the date any officer of
the Company actually receives such application, unless any such officer shall
have consented in writing to an earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the Rights Agent
shall have received written instructions in response to such application
specifying the action to be taken or omitted.

       

      (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 herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other legal
entity.

       

      (i)           The
Rights Agent may execute and exercise any of the rights or powers hereby vested
in it or perform any duty hereunder either itself or by or through its attorneys
or agents, 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)           No
provision of this Agreement shall require the Rights Agent to expend or risk its
own funds or otherwise incur any financial liability in the performance of any
of its duties hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or adequate
indemnification against such risk or liability is not reasonably assured to
it.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

          

              
21.           Change of Rights
Agent.  The Rights Agent or any successor Rights Agent may
resign and be discharged from its duti  es under this Agreement upon thirty
(30) days’ written notice mailed to the Company and to each transfer agent of
the Preferred Shares and the Common Stock by registered or certified mail, and
to the holders of the Rights Certificates 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.  The Company may remove the Rights Agent
or any successor Rights Agent upon thirty (30) days’ written notice, mailed to
the Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Preferred Shares and the Common Stock by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail.  If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent.  If the Company shall fail to make such appointment
within a period of thirty (30) days after giving notice of such removal or after
receiving written notice of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Rights Certificate (who shall,
with such notice, submit his or her Rights Certificate for inspection by the
Company), then the registered holder of any Rights Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights
Agent.  Any successor Rights Agent, whether appointed by the Company
or by such a court, shall be a corporation organized and doing business under
the laws of the United States or of any state of the United States, in good
standing, which is authorized under such laws to exercise corporate trust or
stockholder services 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, along with its Affiliates, a combined capital and surplus of at
least U.S. $50 million.  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 Preferred Shares and the Common Stock, and
mail a written notice thereof to the registered holders of the Rights
Certificates.  Failure to give any notice provided for in this Section
21, however, or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.

       

      22.           Issuance of New Rights
Certificates.  Notwithstanding any of the provisions of this
Agreement or of the Rights to the contrary, the Company may, at its option,
issue new Rights Certificates evidencing Rights in such form as may be approved
by its Board of Directors to reflect any adjustment or change in the Exercise
Price and the number or kind or class of shares or other securities or property
purchasable under the Rights Certificates made in accordance with the provisions
of this Agreement.  In addition, in connection with the issuance or
sale of shares of Common Stock following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall, with respect to
shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement or upon the exercise,
conversion or exchange of other securities of the Company outstanding
at the date hereof or upon the exercise, conversion or exchange of securities
hereinafter issued by the Company and (b) may, in any other case, if deemed
necessary or appropriate by the Board of Directors of the Company, issue Rights
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no
such Rights Certificate shall be issued and this sentence shall be null and void
ab initio if, and to the extent that, such issuance or this sentence would
create a significant risk of or result in material adverse tax consequences to
the Company or the Person to whom such Rights Certificate would be issued or
would create a significant risk of or result in such options’ or employee plans’
or arrangements’ failing to qualify for otherwise available special tax
treatment and (ii) no such Rights Certificate shall be issued if, and to the
extent that, appropriate adjustment shall otherwise have been made in lieu of
the issuance thereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      23.           Redemption.

       

      (a)           The
Company may, at its option and with the approval of the Board of Directors, at
any time prior to the Close of Business on the earlier of (i) the Shares
Acquisition Date and (ii) the Final Expiration Date, redeem all but not less
than all the then outstanding Rights at a redemption price of U.S. $0.001 per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such redemption price being
herein referred to as the “Redemption Price”)
and the Company may, at its option, pay the Redemption Price either in shares of
Common Stock (based on the Current Per Share Market Price thereof at the time of
redemption) or cash.  Such redemption of the Rights by the Company 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 date on
which the Board of Directors elects to make the redemption effective shall be
referred to as the “Redemption
Date”.

       

      (b)           Immediately
upon the action of the Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed with the Rights Agent,
and without any further action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the holders of Rights
shall be to receive the Redemption Price.  The Company shall promptly
give public notice of any such redemption; provided, however, that the
failure to give or any defect in, any such notice shall not affect the validity
of such redemption.  Within ten (10) days after the action of the
Board of Directors ordering the redemption of the Rights, the Company shall give
notice of such redemption to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Stock.  Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the
notice.  Each such notice of redemption will state the method by which
the payment of the Redemption Price will be made.  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 shares of Common Stock prior to the Distribution
Date.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      24.           Exchange.

       

          (a)           Subject
to applicable laws, rules and regulations, and subject to subsection 24(c)
below, the Company may, at its option, by action of the Board of Directors, at
any time after the occurrence of a Triggering Event, exchange all or part of the
then outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 7(e) hereof) for shares
of Common Stock at an exchange ratio of one share of Common Stock 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
shall not be empowered to effect such exchange at any time after any Person
(other than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or any such Subsidiary, or any entity holding Common Stock
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% or more of the
Common Stock then outstanding.

       

                      
(b)           Immediately
upon the action of the Board of Directors ordering the exchange of any Rights
pursuant to subsection 24(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 shares of Common Stock equal to the number of such Rights held by such
holder multiplied by the Exchange Ratio.  The Company shall 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 shall mail a notice of any such exchange
to all of the holders of such Rights at their last addresses as they appear upon
the registry books of the Rights Agent.  Any notice 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 shares of Common Stock 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 void pursuant
to the provisions of Section 7(e) hereof) held by each holder of
Rights.

       

                      
(c)           In the
event that there shall not be sufficient shares of Common Stock issued but not
outstanding or authorized but unissued to permit any exchange of Rights as
contemplated in accordance with Section 24(a), the Company shall either take
such action as may be necessary to authorize additional shares of Common Stock
for issuance upon exchange of the Rights or alternatively, at the option of a
majority of the Board of Directors, with respect to each Right (i) pay cash in
an amount equal to the Current Value (as hereinafter defined), in lieu of
issuing shares of Common Stock in exchange therefor, or (ii) issue debt or
equity securities or a combination thereof, having a value equal to the Current
Value, in lieu of issuing shares of Common Stock in exchange for each such
Right, where the value of such securities shall be determined by a nationally
recognized investment banking firm selected by majority vote of the Board of
Directors, or (iii) deliver any combination of cash, property, shares of Common
Stock and/or other securities having a value equal to the Current Value in
exchange for each Right.  For purposes of this Section 24(c) only, the
Current Value shall mean the product of the Current Per Share Market Price of
shares of Common Stock on the date of the occurrence of the event described
above in subparagraph (a), multiplied by the number of shares of Common Stock
for which the Right otherwise would be exchangeable if there were sufficient
shares available.  To the extent that the Company determines that some
action need be taken pursuant to clauses
(i), (ii) or (iii) of this Section 24(c), the Board of Directors may temporarily
suspend the exercisability of the Rights for a period of up to sixty (60) days
following the date on which the event described in Section 24(a) shall have
occurred, in order to seek any authorization of additional shares of Common
Stock and/or to decide the appropriate form of distribution to be made pursuant
to the above provision and to determine the value thereof.  In the
event of any such suspension, the Company shall issue a public announcement
stating that the exercisability of the Rights has been temporarily
suspended.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          
            (d)           The
Company shall not be required to issue fractions of shares of Common Stock or to
distribute certificates which evidence fractional shares of Common
Stock.  In lieu of such fractional shares of Common Stock, there shall
be paid to the registered holders of the Rights Certificates with regard to
which such fractional shares of Common Stock would otherwise be issuable, an
amount in cash equal to the same fraction of the current market value of a whole
share of Common Stock (as determined pursuant to the terms
hereof).

      

       

                  (e)           The
Company may, at its option, by majority vote of the Board of Directors, at any
time before any Person has become an Acquiring Person, exchange all or part of
the then outstanding Rights for rights of substantially equivalent value, as
determined reasonably and with good faith by the Board of Directors, based upon
the advice of one or more nationally recognized investment banking
firms.

       

                  (f)           Immediately
upon the action of the Board of Directors ordering the exchange of any Rights
pursuant to subsection 24(e) 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 rights in exchange therefor as has been determined by the Board of
Directors in accordance with subsection 24(e) above.  The Company
shall 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 shall mail a notice of any such exchange
to all of the holders of such Rights at their last addresses as they appear upon
the registry books of the transfer agent for the shares of Common Stock of the
Company.  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 Rights will be effected.

       

      25.           Notice of Certain
Events.

       

      (a)           In
case the Company shall propose to effect or permit to occur any Triggering Event
or Section 13 Event, the Company shall give notice thereof to each holder of
Rights in accordance with Section 26 hereof at least twenty (20) days prior to
occurrence of such Triggering Event or such Section 13 Event.

       

      (b)           In
case any Triggering Event or Section 13 Event shall occur, then, in any such
case, the Company shall as soon as practicable thereafter give to each holder of
a Rights Certificate, in accordance with Section 26 hereof, a notice of the
occurrence of such event, which shall specify the event and the consequences of
the event to holders of Rights under Sections 11(a)(ii) and 13
hereof.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

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

       

      Omega
Navigation Enterprises, Inc.

      24
Kaningos Street, Kastella

      185 34
Piraeus

      Greece

      Attention:
Harris Loukopoulos

       

      with a
copy to:

       

      Seward
& Kissel LLP

      One
Battery Park Plaza

      New York,
New York 10004

      Attention:
Gary J. Wolfe, Esq.

       

      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 Rights
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 Street, Suite 800

      Golden,
Colorado 80401

       

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

       

      27.           Supplements and
Amendments.  Prior to the occurrence of a Distribution Date,
the Company may supplement or amend this Agreement in any respect without the
approval of any holders of Rights and the Rights Agent shall, if the Company so
directs, execute such supplement or amendment.  From and after the
occurrence of a Distribution Date, the Company and the Rights Agent may from
time to time supplement or amend this Agreement without the approval of any
holders of Rights in order to (i) cure any ambiguity, (ii) correct or supplement
any provision contained herein which may be defective or inconsistent with any
other provisions herein, (iii) shorten or lengthen any time period hereunder or
(iv) to change or supplement the provisions hereunder in any manner that the
Company may deem necessary or desirable and that shall not adversely affect the
interests of the holders of Rights (other than an Acquiring Person or an
Affiliate or Associate of an Acquiring Person); provided, this Agreement may not
be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed at such
time as the Rights are not then redeemable or (B) any other time period unless
such lengthening is for the purpose of protecting, enhancing or
clarifying the rights of, and/or the benefits to, the holders of Rights (other
than an Acquiring Person or an Affiliate or Associate of an Acquiring
Person).  Upon the delivery of a certificate from an appropriate
officer of the Company that 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 that such supplement or amendment does
not adversely affect the rights, duties or obligations of the Rights Agent 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 shares of Common Stock.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      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.

       

      29.           Determinations and Actions
by the Board of Directors, etc.  For all purposes of this
Agreement, any calculation of the number of shares of Common Stock outstanding
at any particular time, including for purposes of determining the particular
percentage of such outstanding shares of Common Stock of which any Person is the
Beneficial Owner, shall be made in accordance with the last sentence of Rule
13d-3(d)(1)(i) of the General Rules and Regulations under the Exchange
Act.  The Board of Directors of the Company shall have the exclusive
power and authority to administer this Agreement and to exercise all rights and
powers specifically granted to the Board, or the Company, or as may be necessary
or advisable in the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions of this
Agreement and (ii) make all determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend the Agreement).  All such actions,
calculations, interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing) which are done or
made by the Board in good faith, shall (x) be final, conclusive and binding on
the Company, the Rights Agent, the holders of the Rights Certificates and all
other parties and (y) not subject the Board to any liability to the holders of
the Rights.

       

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

       

      31.           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; provided, however, that
notwithstanding anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or authority to be
invalid, void or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the invalid language from
this Agreement would adversely affect the purpose or effect of this Agreement,
the right of redemption set forth in Section 23 hereof shall be
reinstated and shall
not expire until the Close of Business on the tenth day following the date of
such determination by the Board of Directors.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      32.           Governing
Law.  This Agreement and each Right and each Rights Certificate
issued hereunder shall be deemed to be a contract made under the laws of New
York and for all purposes shall be governed by and construed in accordance with
the laws of such jurisdiction applicable to contracts to be made and performed
entirely within such jurisdiction.

       

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

       

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

       

      35.           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.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      IN
WITNESS WHEREOF, the parties have executed this Stockholder Rights Agreement as
of the date first written above.

       

      OMEGA
NAVIGATION ENTERPRISES, INC.

       

      By:_________________________________

      Name:
George Kassiotis

       

      Title:  President
and Chief Executive Officer

       

      COMPUTERSHARE
TRUST COMPANY, N.A.

       

      By:_________________________________

      Name:

      Title:

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      

       

      Exhibit
A

       

      CERTIFICATE
OF DESIGNATIONS OF RIGHTS, PREFERENCES AND PRIVILEGES OF SERIES A PARTICIPATING
PREFERRED STOCK OF

      OMEGA
NAVIGATION ENTERPRISES, INC.

       

      The
undersigned, Mr. George Kassiotis and Mr. Harris Loukopoulos do hereby
certify:

       

      1.           That
they are the duly elected and acting President/Chief Executive Officer and
Executive Vice President/Chief Operating Officer, respectively, of Omega
Navigation Enterprises, Inc., a Marshall Islands corporation (the “Company”).

       

      2.           That
pursuant to the authority conferred by the Company’s Amended and Restated
Articles of Incorporation, the Company’s Board of Directors on February 22,
2008 adopted the following resolution designating and prescribing the relative
rights, preferences and limitations of the Company’s Series A Participating
Preferred Stock:

       

      RESOLVED,
that pursuant to the authority vested in the Board of Directors (the “Board”) of the
Company by the Articles of Incorporation, the Board does hereby establish a
series of preferred stock, par value U.S. $0.01 per share, and the designation
and certain powers, preferences and other special rights of the shares of such
series, and certain qualifications, limitations and restrictions thereon, are
hereby fixed as follows:

       

      Section
1.                      Designation and
Amount.  The shares of such series shall be designated as
“Series A
Participating Preferred Stock”.  The Series A Participating
Preferred Stock shall have a par value of U.S. $0.01 per share, and the number
of shares constituting such series shall initially be 1,000,000, which number
the Board may from time to time increase or decrease (but not below the number
then outstanding).

       

      Section
2.                      Proportional
Adjustment.  In the event the Company shall at any time after
the issuance of any share or shares of Series A Participating Preferred Stock
(i) declare any dividend on the common stock of the Company par value U.S. $0.01
per share (the “Common
Stock”) payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock or (iii) combine the outstanding Common Stock into a smaller number
of shares, then in each such case the Company shall simultaneously effect a
proportional adjustment to the number of outstanding shares of Series A
Participating Preferred Stock.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Section
3.                      Dividends and
Distributions.

       

      (a)           Subject
to the prior and superior right of the holders of any shares of any series of
preferred stock ranking prior and superior to the shares of Series A
Participating Preferred Stock with respect to dividends, the holders of shares
of Series A Participating Preferred
Stock shall be entitled to receive when, as and if declared by the Board out of
funds legally available for the purpose, quarterly dividends payable in
quarterly in each year (each such date being referred to herein as a “Quarterly Dividend Payment
Date”), commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A Participating
Preferred Stock, in an amount per share (rounded to the nearest cent) equal to
1,000 times the aggregate per share amount of all cash dividends, and 1,000
times the aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in shares of Common Stock
or a subdivision of the outstanding shares of Common Stock (by reclassification
or otherwise), declared on the Common Stock since the immediately preceding
Quarterly Dividend Payment Date, or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series A Participating Preferred Stock.

       

      (b)           The
Company  shall declare a dividend or distribution on the Series A
Participating Preferred Stock as provided in paragraph (a) above immediately
after it declares a dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock).

       

      (c)           Dividends
shall begin to accrue on outstanding shares of Series A Participating Preferred
Stock from the Quarterly Dividend Payment Date immediately preceding the date of
issue of such shares of Series A Participating Preferred Stock, unless the date
of issue of such shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Participating Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to accrue
from such Quarterly Dividend Payment Date.  Accrued but unpaid
dividends shall not bear interest.  Dividends paid on the shares of
Series A Participating Preferred Stock in an amount less than the total amount
of such dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the time
outstanding.  The Board may fix a record date for the determination of
holders of shares of Series A Participating Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record date shall
be no more than 30 days prior to the date fixed for the payment
thereof.

       

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

       

      (a)           Each
share of Series A Participating Preferred Stock shall entitle the holder thereof
to 1,000 votes on all matters submitted to a vote of the stockholders of the
Company .

       

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

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (c)           Except
as required by law, holders of Series A Participating Preferred Stock shall have
no special voting rights and their consent shall not be required (except to the
extent they are entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.

       

      Section
5.                      Certain
Restrictions.

       

      (a)           The
Company shall not declare any dividend on, make any distribution on, or redeem
or purchase or otherwise acquire for consideration any shares of Common Stock
after the first issuance of a share or fraction of a share of Series A
Participating Preferred Stock unless concurrently therewith it shall declare a
dividend on the Series A Participating Preferred Stock as required by Section 3
hereof.

       

      (b)           Whenever
quarterly dividends or other dividends or distributions payable on the Series A
Participating Preferred Stock as provided in Section 3 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Participating Preferred Stock outstanding
shall have been paid in full, the Company shall not (i) declare or pay dividends
on, make any other distributions on, or redeem or purchase or otherwise acquire
for consideration any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Participating
Preferred Stock; (ii) declare or pay dividends on, 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 Series A Participating Preferred
Stock, except dividends paid ratably on the Series A Participating 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 Participating Preferred Stock,
provided that the Company may at any time redeem, purchase or otherwise acquire
shares of any such parity stock in exchange for shares of any stock of the
Company ranking junior (either as to dividends or upon dissolution, liquidation
or winding up) to the Series A Participating Preferred Stock; (iv) purchase or
otherwise acquire for consideration any shares of Series A Participating
Preferred Stock, or any shares of stock ranking on a parity with the Series A
Participating Preferred Stock, except in accordance with a purchase offer made
in writing or by publication (as determined by the Board) to all holders of such
shares upon such terms as the Board, 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.

       

      (c)           The
Company  shall not permit any subsidiary of the Company  to
purchase or otherwise acquire for consideration any shares of stock of the
Company  unless the Company  could, under paragraph (a) of
this Section 5, purchase or otherwise acquire such shares at such time and in
such manner.

       

      Section
6.                      Reacquired
Shares.  Any shares of Series A Participating Preferred Stock
purchased or otherwise acquired by the Company  in any manner
whatsoever shall be retired and canceled promptly after the acquisition
thereof.  All such shares shall upon their cancellation become
authorized but unissued shares of preferred stock and may be reissued as part of
a new series of
preferred stock to be created by resolution or resolutions of the Board, subject
to the conditions and restrictions on issuance set forth herein and, in the
Articles of Incorporation, as then amended.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Section
7.                      Liquidation, Dissolution or
Winding Up.  Upon any liquidation, dissolution or winding up of
the Company, the holders of shares of Series A Participating Preferred Stock
shall be entitled to receive an aggregate amount per share equal to 1,000 times
the aggregate amount to be distributed per share to holders of shares of Common
Stock plus an amount equal to any accrued and unpaid dividends on such shares of
Series A Participating Preferred Stock.

       

      Section
8.                      Consolidation, Merger,
etc.  In case the Company shall enter into any consolidation,
merger, combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such case the shares of Series A Participating Preferred
Stock shall at the same time be similarly exchanged or changed in an amount per
share equal to 1,000 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged.

       

      Section
9.                      No
Redemption.  The shares of Series A Participating Preferred
Stock shall not be redeemable.

       

      Section
10.                   Ranking.  The
Series A Participating Preferred Stock shall rank junior to all other series of
the Company’s preferred stock as to the payment of dividends and the
distribution of assets, unless the terms of any such series shall provide
otherwise.

       

      Section
11.                    Amendment.  The
Articles of Incorporation of the Company shall not be further amended in any
manner which would materially alter or change the powers, preference or special
rights of the Series A Participating Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of a majority of the
outstanding shares of Series A Participating Preferred Stock, voting separately
as a class.

       

      Section
12.                   Fractional
Shares.  Series A Participating Preferred Stock may be issued
in fractions of a share which shall entitle the holder, in proportion to such
holder’s fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Participating Preferred Stock.

       

      RESOLVED
FURTHER, that the President, Chief Executive Officer or any Vice President and
the Secretary or any Assistant Secretary of this Company be, and they hereby
are, authorized and directed to prepare and file a Certificate of Designation of
Rights, Preferences and Privileges in accordance with the foregoing resolution
and the provisions of Marshall Islands law and to take such actions as they may
deem necessary or appropriate to carry out the intent of the foregoing
resolution.”

       

      REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      We
further declare under penalty of perjury that the matters set forth in the
foregoing Certificate of Designation are true and correct of our own
knowledge.

       

      Executed
in Piraeus, Greece on February 22, 2008.

       

      

      
        	 	 
	 
      	
                George
      Kassiotis

                President
      & Chief Executive Officer

              
	 	 
	 	 
	 
      	
                Harris
      Loukopoulos

                Executive
      Vice President &

                Chief
      Operating Officer

              
	 
      	 
      
	 
      	 
      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
B

      FORM OF
RIGHTS CERTIFICATE

      

      
        	
                Class
      A

              	
                Class
      A

              
	
                COMMON
      STOCK

              	
                COMMON
      STOCK

              
	
                PAR
      VALUE $.01

              	 
      

      

      

      Certificate                                                                                                                                                                Shares

        Number

       

      OMEGA
NAVIGATION ENTERPRISES, INC.

       

      INCORPORATED
UNDER THE LAWS OF THE REPUBLIC OF THE MARSHALL ISLANDS

       

      75,000,000
AUTHORIZED SHARES $.01 PAR VALUE

       

       

      
        
          	
                  THIS
      CERTIFIES THAT

                	 
      	
                  CUSIP
      46476R 10 5

                
	 
      	 
      	 
      
	
                  is
      the owner of

                	 
      	 
      
	 
      	 
      	 
      

        

      FULLY
PAID AND NON-ASSESSABLE SHARES OF THE CLASS A COMMON STOCK OF

       

      Omega Navigation Enterprises, Inc.
(hereinafter called the “Company”), transferable on the books of the
Company in person or by duly authorized attorney, upon surrender of this
Certificate properly endorsed. This Certificate and the shares represented
hereby, are issued and shall be held subject to all the provisions of the
Articles of Incorporation, as amended, and the Bylaws, as amended, of the
Company (copies of which are on file with the Company and with the Transfer
Agent), to all of which each holder, by acceptance hereof,
assents.  This Certificate is not valid unless countersigned and
registered by the Transfer Agent and Registrar.

       

      Witness the facsimile seal of
the Company and
the facsimile signatures of its duly
authorized officers.

      

      
        	 
      	 
      	
                DATED

              
	 
      	 
      	
                COUNTERSIGNED
      AND REGISTERED:

              
	 
      	 
      	
                COMPUTERSHARE
      TRUST COMPANY, INC.

              
	
                President

              	
                [CORPORATE
      SEAL]

              	
                DENVER

              
	 
      	 
      	
                TRANSFER
      AGENT AND REGISTRAR

              
	 
      	 
      	 
      
	
                Secretary

              	 
      	
                By:
      ___________________________________

              
	 
      	 
      	
                AUTHORIZED
      PERSON

              

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
C

       

      SUMMARY
OF RIGHTS

       

      
        	
                Distribution
      and Transfer of Rights; Distribution Date:

                 

              	
                The
      rights will separate from the common stock and become exercisable after
      (1) the 10th day after public announcement that a person or group has
      acquired ownership of 15% or more of the company’s common stock or (2) the
      10th business day (or such later date as determined by the company’s board
      of directors) after a person or group announces a tender or exchange offer
      which would result in that person or group holding 15% or more of the
      company’s common stock.

                 

              
	
                Preferred
      Stock Purchaseable Upon Exercise of Rights:

              	
                On
      the Distribution Date, each holder of a right will be entitled to purchase
      for U.S. $60 (the “Exercise Price”) a fraction (1/1000th) of one share of
      the company’s preferred stock which has similar economic terms as one
      share of common stock.

                 

              
	
                Flip-in:

              	
                If
      an acquiring person (an “Acquiring Person”) acquires more than 15% of the
      company’s common stock then each holder of a right (except that acquiring
      person) will be entitled to buy at the Exercise Price, a number of shares
      of the company’s common stock which has a market value of twice the
      Exercise Price.

                 

              
	
                Flip-over:

              	
                If
      after an Acquiring Person acquires more than 15% of the company’s common
      stock, the company merges into another company (either as the surviving
      corporation or as the disappearing entity) or the company sells more than
      50% of its assets or earning power, then each holder of a right (except
      for those owned by the acquirer) will be entitled to purchase at the
      Exercise Price, a number of shares of common stock of the surviving entity
      which has a then current market value of twice the Exercise
      Price.

                 

              
	
                Exchange
      Provision:

              	
                Any
      time after the date an Acquiring Person obtains more than 15% of the
      company’s common stock and before that Acquiring Person acquires more than
      50% of the company’s outstanding common stock, the company may exchange
      each right owned by all other rights holders, in whole or in part, for one
      share of the company’s common stock.

                 

              
	
                Redemption
      of Rights:

              	
                The
      company can redeem the rights at any time prior to a public announcement
      that a person has acquired ownership of 15% or more of the company’s
      common stock.

                 

              
	
                Expiration
      of Rights:

              	
                The
      rights expire on the earliest of (1) March 7, 2018 or (2) the
      exchange or redemption of the rights as described above.

                 

              
	
                Amendment
      of Terms of Rights:

              	
                The
      terms of the rights and the Stockholder Rights Plan may be amended without
      the consent of the rights holders at any time on or prior to the
      Distribution Date.  After the Distribution Date, the terms of
      the rights and the Stockholder Rights Plan may be amended to make changes,
      which do not adversely affect the rights of the rights holders (other than
      the Acquiring Person).

                 

              
	
                Voting
      Rights:

              	
                The
      rights will not have any voting rights.

                 

              
	
                Anti-dilution
      Provisions:

              	
                The
      rights will have the benefit of certain customary anti-dilution
      protections.

              

      

      

      SK 23286
0001 848949 v2

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