Document:

<PAGE>

Exhibit 10.23     Letter Agreement with George L. Hernandez

January 5, 2001

Mr. George Hernandez
43231 Turquoise Street
Fremont, CA 94539

Dear George:

We are pleased to invite you to join SoftNet Systems, Inc. as Vice
President/Corporate Controller, reporting to Garrett Girvan, Chairman & CEO.

You will be paid bi-weekly wages of $6923.08 (annualized at $180,000). Effective
your date of hire you will be eligible to participate in insurance plans
provided by SoftNet to it's employees. Those insurance plans include medical,
dental, and life insurance; long term disability, and a flexible-spending
program. As a new hire you are eligible to enroll in the 401 (K) Plan on the
first of the month following 30 days of employment.

In addition you will be eligible to participate in the 2001 Bonus Plan and
receive at target, a 30% bonus, assuming the company meets its business and
financial goals. This bonus will be pro-rated based upon your date of hire.

You are being recommended for participation in the SoftNet Systems, Inc. Stock
Incentive Plan. Under this plan you are being recommended for a grant, subject
to the approval of he SoftNet Compensation Committee, for 20,000 shares of
SoftNet Systems Stock Options. The price of the options will be established as
of your approval grant date. Vesting will accrue as of your date of hire and a
copy of the Plan will be given to you once you are accepted.

To assist us in complying with the Immigration Reform Act of 1986 which requires
employers to verify citizenship and legal right to work of all new employees
within three business days of your time of hire, you will need to complete Part
1 of the enclosed Employee Eligibility Verification Form (1-9), dating it with
the date of your first day of work. You will also need to be prepared to supply
to Human Resources any documents needed to satisfy the requirements of Part 2 of
the I-9 form; either one from list A or one from list B and one from list C. The
documents must be originals, not facsimiles, and need only meet the minimum
requirements.

We sincerely hope you decide to join us, and that this will be a great job
opportunity for you. If you have any questions please call me at (415) 365-2553.

Sincerely,

Michael Sweet
Vice President, Human Resources
SoftNet Systems, Inc. and subsidiaries

Please be advised that you will be employed under the "at will" doctrine and
that SoftNet Systems, Inc. may terminate your employment at any time with or
without cause. and with or without notice at any time at the option of either
the Company or you.

To accept this offer of employment, please sign and return both pages of the
original letter to me by January 12, 2001. Please indicate you anticipated start
date. You may keep a copy for your records.

This offer is contingent upon completion of background verification. Please
complete and return the background disclosure and release authorization form.
The following forms are also enclosed to be completed by you and returned with
the signed offer letter: a W-4, 1-9, and an Employment Application.

This offer will remain in effect through Wednesday, January 12, 2001.

<PAGE>

I accept, understand, and agree to the terms of this offer of employment.

____________________________                         __________________________
Print Name                                                    Date

_____________________________
Signature

My anticipated start date will be: ___________________________

<PAGE>

February 16, 2001

George Hernandez
SoftNet Systems, Inc.

Dear George:

This letter replaces the letter to you, from Garret Girvan dated January 9,
2001. On February 2, 2001 the Board of Directors approved the following revised
Special Retention Program.

This Special Retention Program will be paid to you under the following
conditions, in addition to your normal salary, providing you do not voluntarily
resign or are terminated for cause:

     1.   If the Company terminates you before September 30, 2001 or you leave
          following 60 days after a change in control of SoftNet Systems, Inc.,
          you will receive 12 months of your base pay, on your end or,

     2.   September 30, 2001 you will receive six (6) months base pay and,

     3.   If the Company terminates from October 1, 2001 to December 31, 2001,
          or you leave following 60 days after a change in control of SoftNet
          Systems, Inc., you will receive six (6) months base salary plus 50% of
          your earned base salary from September 30, 2001.

     4.   You will be eligible to receive the normal salary adjustments through
          the Company's annual merit review, effective October 1, 2001.

     5.   If you are employed on December 31, 2001 you will receive an
          additional 7.5 months base pay.

     6.   You agree the Company can terminate your employment at anytime.

     7.   The Board of Directors has also approved additional stock options in
          the amount of 50,000 shares, effective 2-2-01.

We understand that during this time of change you will have many questions about
the transition and we will do our best to provide you with current and timely
information. At this stage not all of the issues and details have been decided
upon, yet we are committed to making sure that you receive information that
impacts you personally as soon as it is available. In the meanwhile, feel free
to contact me, or Mike Sweet at 415-365-2553.

I sincerely appreciate your continued efforts during this time of change and I
am proud of all we have accomplished.

Sincerely,

Ron Simon
Acting Chairman & CEO

I understand, agree and accept the above.

_________________________                   ____________________
George Hernandez                                     Date<PAGE>

                                                                     Exhibit 4.1

                                RIGHTS AGREEMENT

                                   dated as of

                                December 31, 2001

                                 by and between

                             STANDARD PACIFIC CORP.

                                       and

                         EQUISERVE TRUST COMPANY, N.A.,

                                 as Rights Agent

<PAGE>

                                TABLE OF CONTENTS
                                -----------------

                                                                            Page
                                                                            ----

Section 1.   Certain Definitions.......................................        1

Section 2.   Appointment of Rights Agent...............................        5

Section 3.   Issuance of Rights Certificates...........................        6

Section 4.   Form of Right Certificates................................        7

Section 5.   Countersignature and Registration. .......................        7

Section 6.   Transfer, Split Up, Combination and Exchange of Right
                 Certificates; Mutilated, Destroyed, Lost or
                 Stolen Right Certificates. ...........................        8

Section 7.   Exercise of Rights .......................................        9

Section 8.   Cancellation and Destruction of Right Certificates........       11

Section 9.   Reservation and Availability of Capital Stock.............       11

Section 10.  Securities Record Date ...................................       12

Section 11.  Adjustment of Exercise Price, Number of Shares
                 Issuable Upon Exercise of Rights or Number
                 of Rights.............................................       12

Section 12.  Certificate of Adjusted Exercise Price or Number
                 of Shares Issuable Upon Exercise of Rights ...........       17

Section 13.  Consolidation, Merger or Sale or Transfer of
                 Assets or Earning Power ..............................       17

Section 14.  Fractional Rights and Fractional Shares ..................       20

Section 15.  Rights of Action .........................................       20

Section 16.  Agreement of Right Holders ...............................       21

Section 17.  Right Holder and Right Certificate Holder Not
                 Deemed a Stockholder .................................       21

Section 18.  Concerning the Rights Agent ..............................       22

Section 19.  Merger or Consolidation or Change of Name
                 of Rights Agent ......................................       22

Section 20.  Duties of Rights Agent ...................................       23

                                       i

<PAGE>

Section 21. Change of Rights Agent .....................................      25

Section 22. Issuance of New Right Certificates .........................      26

Section 23. Redemption of Rights .......................................      26

Section 24. Exchange of Rights .........................................      27

Section 25. Notice of Certain Events ...................................      28

Section 26. Notices ....................................................      28

Section 27. Supplements and Amendments .................................      29

Section 28. Certain Covenants ..........................................      29

Section 29. Successors .................................................      30

Section 30. Benefits of this Agreement .................................      30

Section 31. Severability ...............................................      30

Section 32. Governing Law ..............................................      30

Section 33. Counterparts ...............................................      30

Section 34. Descriptive Headings .......................................      30

Section 35. Determination and Actions by the Board of Directors ........      31

                                TABLE OF EXHIBITS
                                -----------------

Exhibit A -- Form of Right Certificate

                                       ii

<PAGE>

                                RIGHTS AGREEMENT

         This Rights Agreement (the "Agreement") is made and entered into as of
December 31, 2001 by and between STANDARD PACIFIC CORP., a Delaware corporation
(the "Company"), and EQUISERVE TRUST COMPANY, N.A., a federally chartered trust
company, as rights agent (the "Rights Agent").

         WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one preferred stock purchase right (a "Right") for each
Common Share (as hereinafter defined) of the Company outstanding on December 31,
2001 (the "Record Date"), each Right representing the right to purchase one
one-hundredth of a Preferred Share (as hereinafter defined), upon the terms and
subject to the conditions set forth herein, and has further authorized and
directed the issuance of one Right with respect to each Common Share that shall
become outstanding between the Record Date and the earliest of the Distribution
Date, the Redemption Date or the Expiration Date (as such terms are hereinafter
defined).

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

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

         (a) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 promulgated under the Exchange Act, as in
effect on the date hereof.

         (b) A Person shall be deemed the "Beneficial Owner" of and shall be
deemed to "Beneficially Own" any securities:

                  (i) that such Person or any of such Person's Affiliates or
         Associates beneficially owns, directly or indirectly, for purposes of
         Section 13(d) of the Exchange Act and Rule 13d-3 promulgated under the
         Exchange Act, in each case as in effect on the date hereof;

                  (ii) that such Person or any of such Person's Affiliates or
         Associates has the right to acquire (whether such right is exercisable
         immediately, or only after the passage of time, compliance with
         regulatory requirements, the fulfillment of a condition or otherwise)
         pursuant to any agreement, arrangement or understanding, or upon the
         exercise of conversion rights, exchange rights, rights (other than
         these Rights), warrants or options, or otherwise, provided, however,
                                                           --------  -------
         that a Person shall not be deemed the Beneficial Owner of, or to
         Beneficially Own, securities tendered pursuant to a tender offer 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;

                  (iii) that such Person or any such Person's Affiliates or
         Associates has the right to vote, whether alone or in concert with
         others, pursuant to any agreement, arrangement or understanding,
         provided, however, that a Person shall not be deemed the Beneficial
         --------  -------
         Owner of, or to Beneficially Own, any security if the agreement,
         arrangement or

<PAGE>

          understanding to vote such security (A) arises solely from a revocable
          proxy given to such Person or any of such Person's Affiliates or
          Associates in response to a public proxy solicitation made pursuant to
          and in accordance with the applicable rules and regulations
          promulgated under the Exchange Act, and (B) is not also then
          reportable on Schedule 13D under the Exchange Act (or any comparable
          or successor report);

                  (iv) that are Beneficially Owned, directly or indirectly, by
         any other Person with which such Person or any of such Person's
         Affiliates or Associates has any agreement, arrangement or
         understanding for the purpose of acquiring, holding, voting (other than
         voting pursuant to a revocable proxy as described in the proviso to
         clause (iii) of this definition of "Beneficial Owner") or disposing of
         any securities of the Company; and

                  (v) that, on any day on or after the Distribution Date,
         evidence Rights that prior to such date were represented by
         certificates for Common Shares that such Person Beneficially Owns on
         such day.

Notwithstanding anything to the contrary in this Section l(b), a Person engaged
in business as an underwriter of securities shall not be deemed to be the
Beneficial Owner of, or to Beneficially Own, any securities acquired through
such Person's participation in good faith in a firm commitment underwriting
until the expiration of 40 days after the date of such acquisition.

         (c) "Business Day" shall mean any day other than a Saturday, a Sunday
or a day on which banking institutions in the States of New York or California
are authorized or obligated by law or executive order to close.

         (d) "Certificate of Designations" shall mean the certificate of
designations specifying the powers, designations, preferences and rights of the
Preferred Shares in accordance with the Delaware General Corporation Law.

         (e) "Close of Business" on any given date shall mean 5:00 p.m., New
York City time, on such date; provided, however, that if such date is not a
                              --------  -------
Business Day, it shall mean 5:00 p.m., New York City time, on the next
succeeding Business Day.

         (f) "Closing Price" of a stock or other security on any day shall be
the last sale price, regular way, per share of such stock or unit of such other
security on such day 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 such stock or other 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 such stock or other security is listed or admitted
to trading or, if such stock or other security is not listed or admitted to
trading on any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-the-counter
market, as reported on the Nasdaq National Market ("NASDAQ") or such other
system then in use or, if on any such date such stock or other security is not
quoted by any such organization, the average of the closing bid and asked prices

                                       2

<PAGE>

as furnished by a professional market maker that makes a market in such stock or
other security and that is selected by the Board of Directors of the Company.

     (g) "Common Share" shall mean one share of the common stock, par value $.01
per share, of the Company, unless used with reference to a Person other than the
Company, in which case it shall mean one share of the capital stock (or equity
interest) of such other Person having the greatest voting power per share or, if
such Person is a Subsidiary of another Person, of the Person or Persons that
ultimately controls such Person.

     (h) "Common Share Equivalent" shall have the meaning ascribed to it in
Section 11(a)(iii) hereof.

     (i) "Current Market Price" per share of a stock or unit of any other
security on any date shall mean the average of the daily Closing Prices of such
stock or other security for the 30 consecutive Trading Days through and
including the Trading Day immediately preceding the date in question; provided,
                                                                      --------
however, that if any event shall have caused the Closing Price on any Trading
-------
Day during such 30-day period not to be fully comparable with the Closing Price
on the date in question (or, if no Closing Price is available on the date in
question, on the Trading Day immediately preceding the date in question), then
each such non-comparable Closing Price so used shall be appropriately adjusted
by the Board of Directors in order to make the Closing Price on each Trading Day
during the period used for the determination of the Current Market Price fully
comparable with the Closing Price on such date in question (or, if applicable,
the immediately preceding Trading Day). "Current Market Price" per share of any
stock or unit of such other security that is not publicly held or so listed or
traded, and "Current Market Price" of any other property, shall mean the fair
value per share of such stock or unit of such other security, or the fair value
of such other property, respectively, as determined in good faith by the Board
of Directors of the Company based upon such appraisals or valuation reports of
such independent experts as the Board of Directors shall in good faith determine
appropriate, which determination shall be described in a statement filed by the
Company with the Rights Agent.

     (j) "Distribution Date" shall have the meaning ascribed to it in Section 3
hereof.

     (k) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

     (l) "Exempt Person" shall mean (i) the Company, (ii) any wholly-owned
Subsidiary of the Company and (iii) any employee benefit plan of the Company or
of a Subsidiary of the Company and any Person holding Voting Shares for or
pursuant to the terms of any such employee benefit plan.

     (m) "Exercise Price" shall have the meaning ascribed to it in Section 7(c)
hereof.

     (n) "Expiration Date" shall mean December 31, 2011.

     (o) "Person" shall mean any individual, firm, partnership, corporation,
association, trust, joint venture, limited liability company, unincorporated
organization, group (as such term is used in Rule 13d-5 promulgated under the
Exchange Act as in effect on the date hereof) or other entity, and shall include
any successor (by merger or otherwise) of such entity.

                                       3

<PAGE>

     (p) "Preferred Share" shall mean one share of the Series A Junior
Participating Cumulative Preferred Stock, par value $.01 per share, of the
Company, which shall have the rights and preferences set forth in the
Certificate of Designations for the Preferred Shares.

     (q) "Preferred Share Equivalent" shall have the meaning ascribed to it in
Section 11(b) hereof.

     (r) "Record Date" shall have the meaning ascribed to it in the recitals
hereto.

     (s) "Redemption Date" shall mean the date of the action of the Board of
Directors of the Company authorizing and directing the redemption of the Rights
pursuant to Section 23(a) hereof or the exchange of the Rights pursuant to
Section 24(a) hereof.

     (t) "Redemption Price" shall have the meaning ascribed to it in Section
23(a) hereof.

     (u) "Right Certificate", as that term is used with respect to any period
prior to the Distribution Date, shall have the meaning ascribed to it in Section
3(b) hereof, and, as that term is used with respect to any period on or after
the Distribution Date, shall have the meaning ascribed to it in Section 3(c)
hereof.

     (v) "Rights Expiration Date" shall mean the Expiration Date, except if
there has been a Distribution Date, then it shall mean the tenth anniversary of
the Distribution Date.

     (w) "Section 11(a)(ii) Event" shall have the meaning ascribed to it in
Section 11(a)(ii) hereof.

     (x) "Section 13(a) Event" shall have the meaning ascribed to it in Section
13(a) hereof.

     (y) "Securities Act" shall mean the Securities Act of 1933, as amended.

     (z) "Subsidiary" of any Person shall mean any corporation or other Person
of which equity securities or equity interests representing a majority of the
voting power are owned, directly or indirectly, or which is effectively
controlled, by such Person.

     (aa) "Surviving Person" shall have the meaning ascribed to it in Section
13(a) hereof.

     (bb) "Trading Day" shall mean, as to any stock or other security, a day on
which the principal national securities exchange on which such stock or other
security is listed or admitted to trading is open for the transaction of
business or, if such stock or other security is not listed or admitted to
trading on any national securities exchange, a Business Day.

     (cc) "Voting Share" shall mean (i) a Common Share of the Company and (ii)
any other share of capital stock of the Company entitled to vote generally in
the election of directors or entitled to vote together with the Common Shares in
respect of any merger, consolidation, sale of all or substantially all of the
Company's assets, liquidation, dissolution or winding up. References in this
Agreement to a percentage or portion of the outstanding Voting Shares shall

                                       4

<PAGE>

be deemed a reference to the percentage or portion of the total votes entitled
to be cast by the holders of the outstanding Voting Shares.

     (dd) "15% Ownership 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) of the Exchange Act) by the Company or a
15% Stockholder containing the facts by virtue of which a Person has become a
15% Stockholder.

     (ee) "15% Stockholder" shall mean any Person that Beneficially Owns 15% or
more of the Voting Shares of the Company then outstanding; provided, however,
                                                           --------  -------
that the term "15% Stockholder" shall not include: (i) an Exempt Person; (ii)
any Person that would not otherwise be a 15% Stockholder but for a reduction in
the number of outstanding Voting Shares after the date hereof resulting from a
stock repurchase program or other similar plan of the Company or from a self
tender offer of the Company, provided, however, that the term "15% Stockholder"
                             --------  -------
shall include such Person from and after the first date upon which (A) such
Person, since the date of the relevant reduction in the number of outstanding
Voting Shares of the Company, shall have acquired Beneficial Ownership of, in
the aggregate, a number of Voting Shares of the Company equal to 1% or more of
the Voting Shares of the Company then outstanding and (B) such Person, together
with all Affiliates and Associates of such Person, shall Beneficially Own 15% or
more of the Voting Shares of the Company then outstanding; or (iii) any Person
that would not otherwise be a 15% Stockholder but for its Beneficial Ownership
of Rights. In calculating the percentage of the outstanding Voting Shares that
are Beneficially Owned by a Person for purposes of this definition, Voting
Shares that are Beneficially Owned by such Person shall be deemed outstanding,
and Voting Shares that are not Beneficially Owned by such Person and that are
subject to issuance upon the exercise or conversion of outstanding conversion
rights, exchange rights, rights, warrants or options shall not be deemed
outstanding. Notwithstanding the foregoing, if the Board of Directors of the
Company determines in good faith that a Person that would otherwise be a 15%
Stockholder pursuant to the foregoing provisions of this definition has become
such inadvertently, and such Person, as promptly as practicable after discovery
of the foregoing, has ceased to be a 15% Stockholder, or has entered into such
agreement or arrangement as the Board of Directors of the Company may approve or
the Board of Directors of the Company is otherwise satisfied that such
determination is in the best interests of the Company and its stockholders, then
such Person shall not be deemed to be a 15% Stockholder for any purposes of this
Agreement, and no 15% Ownership Date shall be deemed to have occurred. Any
determination made by the Board of Directors of the Company as to whether any
Person is or is not a 15% Stockholder shall be conclusive and binding upon all
holders of Rights.

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

                                       5

<PAGE>

     Section 3. Issuance of Rights Certificates.
                -------------------------------

     (a) "Distribution Date" shall mean the date, after the date hereof, that is
the earliest of (i) the tenth Business Day (or such later day as shall be
designated by the Board of Directors of the Company) following the date of the
commencement of, or the first public announcement of the intent of any Person,
other than an Exempt Person, to commence a tender offer or exchange offer, the
consummation of which would cause any Person to become a 15% Stockholder, (ii)
the date of the first Section 11(a)(ii) Event or (iii) the date of the first
Section 13(a) Event.

     (b) Until the Distribution Date, (i) the Rights shall be represented by
certificates for Common Shares (all of which certificates for Common Shares
shall be deemed to be Right Certificates) and not by separate Right
Certificates, (ii) the record holder of the Common Shares represented by each of
such certificates shall be the record holder of the Rights represented thereby
and (iii) the Rights shall be transferable only in connection with the transfer
of Common Shares representing the corresponding Rights. Until the earliest of
the Distribution Date, the Redemption Date or the Expiration Date, the surrender
for transfer of such certificates for Common Shares shall also constitute the
surrender for transfer of the corresponding Rights represented thereby.

     (c) As soon as practicable after the Distribution Date, and after
notification by the Company, the Rights Agent shall send, at the expense of the
Company, by first-class, postage-prepaid mail to each record holder of Common
Shares, as of the Close of Business on the Distribution Date, at the address of
such holder shown on the records of the Company, a Right Certificate
substantially in the form of Exhibit A hereto representing one Right for each
                             ---------
Common Share so held. From and after the Distribution Date, the Rights shall be
represented solely by such Right Certificates and may only be transferred by the
transfer of such Right Certificates, and the holders of such Right Certificates,
as listed in the records of the Company or any transfer agent or registrar for
such Rights, shall be the record holders of such Rights.

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

     This certificate also evidences and entitles the holder hereof to certain
     Rights as set forth in a Rights Agreement dated as of December 31, 2001 by
     and between Standard Pacific Corp. and EquiServe Trust Company, N.A., as
     Rights Agent, as amended to date (the "Rights Agreement"), the terms and
     conditions of which are hereby incorporated herein by reference and a copy
     of which is on file at the principal executive offices of Standard Pacific
     Corp. Under certain circumstances specified in the Rights Agreement, such
     Rights will be represented by separate certificates and will no longer be
     represented by this certificate. Under certain circumstances specified in
     the Rights Agreement, Rights beneficially owned by certain Persons may
     become null and void. Standard Pacific Corp. will mail to the record holder
     of this certificate a copy of the Rights Agreement without charge promptly
     following receipt of a written request therefor.

                                       6

<PAGE>

     (e) Certificates for Common Shares issued at any time on or after the
Distribution Date and prior to the earlier of the Redemption Date or the Rights
Expiration Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:

     This certificate does not represent any Right issued pursuant to the terms
     of a Rights Agreement dated as of December 31, 2001 by and between Standard
     Pacific Corp. and EquiServe Trust Company, N.A., as Rights Agent.

     (f) In the event that at any time on or after the earlier of the date of
the first Section 11(a)(ii) Event or the date of the first Section 13(a) Event
and prior to the earlier of the Redemption Date or the Rights Expiration Date,
the Company shall issue any Common Shares pursuant to the exercise of conversion
rights, exchange rights, rights (other than Rights), warrants or options that
shall have been issued or granted prior to the earlier of the date of the first
Section 11(a)(ii) Event or the date of the first Section 13(a) Event, then,
unless the Board of Directors of the Company shall have provided otherwise at
the time of the issuance or grant of such conversion rights, exchange rights,
rights (other than Rights), warrants or options, the Rights Agent shall, as soon
as practicable after the date of such event, send by first-class,
postage-prepaid mail to the record holder of such Common Shares, at the address
of such holder as shown on the records of the Company, a Right Certificate
substantially in the form of Exhibit A hereto representing one Right for each
                             ---------
Common Share so issued.

     (g) Notwithstanding the foregoing provisions of this Section 3, the Rights
Agent shall not send any Right Certificate to any 15% Stockholder or any of its
Affiliates or Associates or to any Person if the Rights held by such Person are
Beneficially Owned by a 15% Stockholder or any of its Affiliates or Associates.
Any determination made by the Board of Directors of the Company as to whether
any Common Shares are or were Beneficially Owned at any time by a 15%
Stockholder or an Affiliate or Associate of a 15% Stockholder shall be
conclusive and binding upon all holders of Rights.

     Section 4. Form of Right Certificates. The Right Certificates and the form
                --------------------------
of assignment, including certificate, and the form of election to purchase,
including certificate, printed on the reverse thereof, when, as and if issued,
shall be substantially the same as Exhibit A 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 upon which the Rights or the securities
of the Company issuable upon exercise of the Rights may from time to time be
listed, or to conform to usage. Subject to Section 22 hereof, Right
Certificates, whenever issued, that are issued in respect of Common Shares that
were issued and outstanding as of the Close of Business on the Distribution
Date, shall be dated as of the Distribution Date.

     Section 5. Countersignature and Registration.
                ---------------------------------

     (a) The Right Certificates shall be executed on behalf of the Company by
any of its Chairman of the Board, its Chief Executive Officer, its President or
any Vice President, either manually or by facsimile signature, and may have
affixed thereto the Company's seal or a

                                       7

<PAGE>

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

     (b) In case any authorized signatory of the Rights Agent who shall have
countersigned any of the Right Certificates shall cease to be such signatory
before delivery by the Company, such Right Certificates, nevertheless, may be
issued and delivered by the Company with the same force and effect as though the
person who countersigned such Right Certificates had not ceased to be such
signatory; and any Right Certificate may be countersigned on behalf of the
Rights Agent by any person who, at the actual date of the countersignature of
such Right Certificate, shall be a proper signatory of the Rights Agent to
countersign such Right Certificate, although at the date of the execution of
this Rights Agreement any such person was not such a signatory.

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

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

     (a) Subject to the provisions of Sections 6(c), 7(d) and 14 hereof, at any
time after the Close of Business on the Distribution Date, and so long as any
Rights represented thereby remain outstanding, any one or more Right
Certificates may be transferred, split-up, combined or exchanged for one or more
Right Certificates representing the same aggregate number of Rights as the Right
Certificates surrendered. Any registered holder desiring to transfer, split up,
combine or exchange one or more Right Certificates shall deliver such request in
writing to the Rights Agent, and shall surrender the Right Certificates to be
transferred, split up, combined or exchanged at the office of the Rights Agent
with the form of assignment, including certificate, on the reverse side thereof
completed and duly executed, with signature guaranteed. Thereupon, the Rights
Agent shall countersign and deliver to the Person entitled thereto one or more
Right Certificates, as so requested. The Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of Right
Certificates.

     (b) Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction or mutilation of a Right
Certificate, and, in case

                                       8

<PAGE>

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 such Right Certificate if mutilated, the
Company shall issue and deliver to the Rights Agent for delivery to the record
holder of such Right Certificate a new Right Certificate of like tenor in lieu
of such lost, stolen, destroyed or mutilated Right Certificate.

     (c) Notwithstanding anything to the contrary in this Section 6, the Rights
Agent shall not countersign and deliver a Right Certificate to any Person if
such Right Certificate represents, or would represent when held by such Person,
Rights that had become or would become null and void pursuant to Section 7(d)
hereof.

     Section 7. Exercise of Rights.
                ------------------

     (a) Until the Distribution Date, no Right may be exercised.

     (b) Subject to Section 7(d) and (g) hereof and the other provisions of this
Agreement, at any time after the Close of Business on the Distribution Date and
prior to the Close of Business on the earlier of the Redemption Date or the
Rights Expiration Date, the registered holder of any Right Certificate may
exercise the Rights represented thereby in whole or in part upon surrender of
such Right Certificate, with the form of election to purchase, including
certificate, on the reverse side thereof completed and duly executed, with
signature guaranteed, to the Rights Agent at the office of the Rights Agent at
EquiServe Trust Company, N.A., 525 Washington Boulevard, Third Floor, Jersey
City, New Jersey 07310, together with payment of the Exercise Price for each
Right exercised. Upon the exercise of an exercisable Right and payment of the
Exercise Price in accordance with the provisions of this Agreement, the holder
of such Right shall be entitled to receive, subject to adjustment as provided
herein, one one-hundredth of a Preferred Share (or Common Shares, other
securities, cash and/or other property in accordance with the provisions of this
Agreement).

     (c) The "Exercise Price" for the exercise of each Right shall initially be
$115 and shall be payable in lawful money of the United States of America in
accordance with Section 7(f) hereof. The Exercise Price and the number of
Preferred Shares (or Common Shares, or other securities) to be acquired upon
exercise of a Right shall be subject to adjustment from time to time as provided
in Sections 7(e), 11 and 13 hereof and the other provisions of this Agreement.

     (d) Notwithstanding anything in this Agreement to the contrary, from and
after the earlier of the date of the first Section 11(a)(ii) Event and the date
of the first Section 13(a) Event, any Rights that are or were Beneficially Owned
by a 15% Stockholder or any Affiliate or Associate of a 15% Stockholder at any
time on or after the Distribution Date shall be null and void, and for all
purposes of this Agreement such Rights shall thereafter be deemed not to be
outstanding, and any holder of such Rights (whether or not such holder is a 15%
Stockholder or an Affiliate or Associate of a 15% Stockholder) shall thereafter
have no right to exercise or exchange such Rights.

     (e) Prior to the Distribution Date, if the Board of Directors of the
Company shall have determined that such action adequately protects the interests
of the holders of Rights, the

                                       9

<PAGE>

Company may, in its discretion, substitute for all or any portion of the
Preferred Shares that would otherwise be issuable (after the Close of Business
on the Distribution Date) upon the exercise of each Right and payment of the
Exercise Price (i) cash, (ii) other equity securities of the Company, (iii) debt
securities of the Company, (iv) other property or (v) any combination of the
foregoing, in each case having an aggregate Current Market Price equal to the
aggregate Current Market Price of the Preferred Shares for which substitution is
made. Subject to Section 7(d) hereof, in the event that the Company takes any
action pursuant to this Section 7(e), such action shall apply uniformly to all
outstanding Rights.

     (f) Upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase, including certificate, properly completed
and duly executed, with signature guaranteed, accompanied by payment of the
Exercise Price for each Right to be exercised and an amount equal to any
applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check or cashier's
check payable to the order of the Company, the Rights Agent shall thereupon
promptly (i) requisition from the transfer agent of the Preferred Shares (or
Common Shares and/or other securities in accordance with this Agreement)
certificates for the number of Preferred Shares (or such other securities) to be
purchased, and the Company hereby irrevocably authorizes such transfer agent to
comply with all such requests, and/or, as provided in Section 14 hereof,
requisition from the depositary agent described therein depositary receipts
representing such number of one-hundredths of a Preferred Share (or such other
securities) as are to be purchased (in which case certificates for the Preferred
Shares (or such other securities) represented by such receipts shall be
deposited by the transfer agent with such depositary agent) and the Company
hereby directs such 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 Preferred Shares (or such other securities) in
accordance with Section 14 hereof or such other cash or property to be issued
upon exercise of the Rights in accordance with the provisions of this Agreement,
(iii) after receipt of such certificates, depositary receipts, property or cash,
cause the same to be delivered to or upon the order of the registered holder of
such Right Certificate, registered in such name or names as may be designated by
such holder and (iv) when appropriate, after receipt thereof, deliver such cash
to or upon the order of the registered holder of such Right Certificate.

     (g) Notwithstanding the foregoing provisions of this Section 7, the
exercisability of the Rights shall be suspended for such period as shall
reasonably be necessary for the Company to register and qualify the Preferred
Shares and/or Common Shares or other securities to be issued pursuant to the
exercise of the Rights under the Securities Act and any applicable securities
law of any jurisdiction; provided, however, that nothing contained in this
                         --------  -------
Section 7 shall relieve the Company of its obligations under Section 9(c)
hereof.

     (h) In case the registered holder of any Right Certificate shall exercise
less than all of the Rights represented thereby, a new Right Certificate
representing Rights equivalent to the Rights remaining unexercised shall be
issued by the Rights Agent to the registered holder of such Right Certificate or
to such holder's duly authorized assigns, subject to the provisions of Section
14 hereof.

     (i) Notwithstanding anything in this Agreement to the contrary, neither the
Rights Agent nor the Company shall be obligated to undertake any action
whatsoever with respect to a

                                       10

<PAGE>

registered holder of Rights upon the occurrence of any purported exercise as set
forth in this Section 7, unless the certificate contained in the form of
election to purchase set forth on the reverse side of the Rights Certificate
surrendered for such exercise shall have been duly completed and signed by the
registered holder thereof and the Company shall have been provided with such
additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company or the
Rights Agent shall request.

     (j) Neither the Company nor the Rights Agent shall have any liability to
any holder of Rights or any other Person as a result of the Company's failure to
make any determination under this Section 7 or any other section with respect to
a 15% Stockholder or an Affiliate or Associate of a 15% Stockholder.

     Section 8. Cancellation and Destruction of Right Certificates. All Right
                --------------------------------------------------
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, (i) if surrendered to the Company or to any of
its agents, be delivered to the Rights Agent for cancellation or in canceled
form, or, (ii) if surrendered to the Rights Agent, shall be canceled by the
Rights Agent, and no Right Certificates shall be issued in lieu thereof except
as expressly permitted by this Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall
promptly cancel and retire, any other Right Certificate purchased or acquired by
the Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Right Certificates to the Company or shall, at the written
request of the Company, destroy such canceled Right Certificates, and in such
case shall deliver a certificate of destruction thereof to the Company.

     Section 9. Reservation and Availability of Capital Stock.
                ---------------------------------------------

     (a) Subject to Sections 7(e) and 9(f) hereof, the Company shall cause to be
reserved and kept available out of its authorized and unissued equity securities
(or out of its authorized and issued equity securities held in its treasury),
the number of such equity securities that will from time to time be sufficient
to permit the exercise in full of all outstanding Rights.

     (b) In the event that any securities issuable upon exercise of the Rights
are listed on any national securities exchange, the Company shall use its best
efforts, from and after such time as the Rights become exercisable, to cause all
such securities issued or reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.

     (c) If necessary to permit the issuance of securities upon exercise of the
Rights, the Company shall use its best efforts, from and after the Distribution
Date, to register and qualify such securities under the Securities Act, the
Exchange Act and any other applicable securities laws and to keep such
registration effective so long as required under such laws.

     (d) The Company shall take all such action as may be necessary to ensure
that all securities delivered upon exercise of the 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 securities.

                                       11

<PAGE>

     (e) The Company shall pay when due and payable any and all federal and
state transfer taxes and charges that may be payable in respect of the issuance
or delivery of the Right Certificates or of any securities upon the exercise of
Rights. The Company shall not, however, be required to pay any transfer tax that
may be payable in respect of any transfer or delivery of a Right Certificate to
a Person other than, or the issuance or delivery of a certificate for securities
in respect of a name other than that of, the registered holder of the Right
Certificate representing Rights surrendered for exercise, or to issue or deliver
any certificate for securities upon the exercise of any Right until any such tax
shall have been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.

     (f) With respect to the Common Shares and/or other securities issuable
pursuant to Section 11(a)(ii) and (iii) hereof, the foregoing covenants of this
Section 9 shall be applicable only upon and following the occurrence of a
Section 11(a)(ii) Event.

     Section 10. Securities Record Date. Each Person in whose name any
                 ----------------------
certificate for 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 the
securities represented thereby on, and such certificate shall be dated, the date
upon which the Right Certificate representing such Rights was duly surrendered
and payment of the Exercise Price (and any applicable taxes) was made; provided,
                                                                       --------
however, that if the date of such surrender and payment is a date upon which the
-------
securities transfer books of the Company are closed, such Person shall be deemed
to have become the record holder of such securities on, and such certificate
shall be dated, the next succeeding Business Day on which the securities
transfer books of the Company are open.

     Section 11. Adjustment of Exercise Price, Number of Shares Issuable Upon
                 ------------------------------------------------------------
Exercise of Rights or Number of Rights. The Exercise Price, the number and kind
--------------------------------------
of securities that may be purchased upon exercise of a Right and the number of
Rights outstanding are subject to adjustment from time to time as provided in
this Section 11.

          (a)(i) In the event that the Company shall at any time after the Close
     of Business on the Record Date and prior to the Close of Business on the
     earlier of the Redemption Date or the Rights Expiration Date (A) declare or
     pay any dividend on the Preferred Shares payable in Preferred Shares or
     Voting Shares, (B) subdivide the outstanding Preferred Shares, (C) combine
     the outstanding Preferred Shares into a smaller number of Preferred Shares
     or (D) issue Preferred Shares or other securities of the Company (other
     than those issuances for which an adjustment is required under Section
     11(b) hereof) 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) or in a
     reorganization of the Company, then, and upon each such event, the number
     and kind of Preferred Shares or other securities issuable upon the exercise
     of a Right on the date of such event shall be proportionately adjusted so
     that the holder of any Right exercised on or after such date shall be
     entitled to receive, upon the exercise thereof and payment of the Exercise
     Price, the aggregate number and kind of Preferred Shares or other
     securities or other property, as the case may be, that, if such Right had
     been exercised immediately prior to such date and at a time when such Right
     was exercisable and the transfer books of the Company were open, such
     holder would have owned upon

                                       12

<PAGE>

     such exercise and would have been entitled to receive by virtue of such
     dividend, subdivision, combination or reclassification. If an event occurs
     that would require an adjustment under both this Section 11(a)(i) and
     Section 11(a)(ii) hereof, the adjustment provided for in this Section
     11(a)(i) shall be in addition to, and shall be made prior to, any
     adjustment required pursuant to Section 11(a)(ii) hereof.

          (ii) In the event that a 15% Ownership Date shall have occurred and
     neither the Redemption Date nor the Expiration Date shall have occurred
     prior to the tenth Business Day following such 15% Ownership Date (a
     "Section 11(a)(ii) Event"), then, and upon each such Section 11(a)(ii)
     Event, proper provision shall be made so that, except as provided in
     Section 7(d) hereof, each holder of a Right shall thereafter have the right
     to receive, upon the exercise thereof in accordance with the terms of this
     Agreement and payment of the then current Exercise Price, such number of
     Common Shares of the Company as shall equal the result obtained by (A)
     multiplying the then current Exercise Price by the then number of
     one-hundredths of a Preferred Share for which a Right was exercisable
     immediately prior to such Section 11(a)(ii) Event (or, if the Distribution
     Date shall not have occurred prior to the date of such Section 11(a)(ii)
     Event, the number of one-hundredths of a Preferred Share for which a Right
     would have been exercisable if the Distribution Date had occurred on the
     Business Day immediately preceding the date of such Section 11(a)(ii)
     Event), and (B) dividing that product by 50% of the Current Market Price of
     a Common Share on the date of occurrence of the relevant Section 11(a)(ii)
     Event (such number of shares being hereinafter referred to as the
     "Adjustment Shares"). Successive adjustments shall be made pursuant to this
     paragraph each time a Section 11(a)(ii) Event occurs.

          (iii) In the event that on the date of a Section 11(a)(ii) Event the
     aggregate number of Common Shares that are authorized by the Company's
     Certificate of Incorporation, as amended from time to time, but not
     outstanding or reserved for issuance for purposes other than upon exercise
     of the Rights is less than the aggregate number of Adjustment Shares
     thereafter issuable upon the exercise in full of the Rights in accordance
     with Section 11(a)(ii) hereof (the excess of such number of Adjustment
     Shares over and above such number of Common Shares being hereinafter
     referred to as the "Unavailable Adjustment Shares"), then, and upon each
     such event, the Company shall substitute for the pro rata portion of the
     Unavailable Adjustment Shares that would otherwise be issuable thereafter
     upon the exercise of each Right and payment of the Exercise Price (A) cash,
     (B) other equity securities of the Company (including, without limitation,
     shares of preferred stock of the Company or units of such shares having the
     same Current Market Price as one Common Share (a "Common Share
     Equivalent")), (C) debt securities of the Company, (D) other property or
     (E) any combination of the foregoing, in each case having an aggregate
     Current Market Price equal to the aggregate Current Market Price of the
     Unavailable Adjustment Shares for which substitution is made. Subject to
     Section 7(d) hereof, in the event that the Company takes any action
     pursuant to this Section 11(a)(iii), such action shall apply uniformly to
     all outstanding Rights.

     (b) In the event that the Company shall, at any time after the Close of
Business on the Record Date and prior to the Close of Business on the earlier of
the Redemption Date or the

                                       13

<PAGE>

Rights Expiration Date, fix a record date for the issuance of rights, options or
warrants to all holders of Preferred Shares entitling such holders initially to
subscribe for or purchase Preferred Shares (or shares having the same rights,
privileges and preferences as the Preferred Shares ("Preferred Share
Equivalents")) or securities convertible into Preferred Shares or Preferred
Share Equivalents, at a price per Preferred Share or Preferred Share Equivalent
(or having a conversion price per share, if a security convertible into
Preferred Shares or Preferred Share Equivalents) less than the Current Market
Price per Preferred Share on such record date, then, and upon each such event,
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 equal to the sum of the number of
Preferred Shares outstanding on such record date plus the number of Preferred
Shares that the aggregate offering price of the total number of Preferred Shares
and/or Preferred Share Equivalents to be so offered (and/or the aggregate
initial conversion price of the convertible securities to be so offered) would
purchase at such Current Market Price, and the denominator of which shall be
equal to the number of Preferred Shares outstanding on such record date plus the
number of additional Preferred Shares and/or Preferred Share Equivalents to be
offered for subscription or purchase (or into which the convertible securities
to be so 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; and provided, further, that if such rights, options
or warrants are not exercisable immediately upon issuance but become exercisable
only upon the occurrence of a specified event or the passage of a specified
period of time, then the adjustment to the Exercise Price shall be made and
become effective only upon the occurrence of such event or such passage of time,
and such adjustment shall be made as if the record date for the issuance of such
rights, options or warrants had been the Business Day immediately preceding the
date upon which such rights, options or warrants became exercisable. Preferred
Shares owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment to the
Exercise Price shall be made successively whenever such a record date is fixed,
and in the event that such rights or warrants are not so issued, the Exercise
Price shall be adjusted to be the Exercise Price that would then be in effect if
such record date had not been fixed.

     (c) In the event that the Company shall, at any time after the Close of
Business on the Record Date and prior to the Close of Business on the earlier of
the Redemption Date or the Rights Expiration Date, fix a record date for the
making of a distribution to all holders of the Preferred Shares (including any
such distribution made in connection with a consolidation or merger in which the
Company is the surviving corporation) of assets (other than a distribution for
which an adjustment is required under Section 11(a)(i) or (b) hereof or a
regular quarterly cash dividend), then 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 equal to the excess of the Current Market Price per Preferred Share on
such record date over and above the fair market value of the portion of the
securities or assets to be so distributed with respect to one Preferred Share,
and the denominator of which shall be equal to such Current Market Price per
Preferred Share; 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

                                       14

<PAGE>

event that such a distribution is not so made, the Exercise Price shall be
adjusted to be the Exercise Price that would then be in effect if such record
date had not been fixed.

     (d) For the purpose of any computation under this Section 11, if the
Preferred Shares are not publicly held or traded, the "Current Market Price" per
Preferred Share shall be conclusively deemed to be the Current Market Price per
Common Share multiplied by 100.

     (e) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the then
current Exercise Price; provided, however, that any adjustments that by reason
                        --------  -------
of this Section 11(e) are not required to be made shall be cumulated and taken
into account in any subsequent adjustment. All calculations under this Section
11 shall be made to the nearest cent or to the nearest one-thousandth of a
Common Share or other share or one-millionth of a Preferred Share, as the case
may be.

     (f) If, as a result of an adjustment made pursuant to Section 11(a) hereof,
the holder of any Right shall be entitled to receive any securities of the
Company other than Preferred Shares upon exercise of such Right, and if an event
occurs in respect of such securities that, if it were to occur in respect of
Preferred Shares, would require an adjustment under this Section 11 in respect
of Preferred Shares, then the number of such other securities so receivable upon
exercise of any Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to Preferred Shares contained in this Section 11, and the other
provisions of this Agreement with respect to Preferred Shares shall apply on
like terms to any such other securities.

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

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

     (i) The Company may elect, on or after the date of any adjustment of the
Exercise Price, to adjust the number of Rights instead of making 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-hundredths of a Preferred Share for which a
Right was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that number
of Rights (calculated to the nearest one one-thousandth of a Right) obtained by
dividing the Exercise Price in effect immediately prior to the adjustment of the
Exercise Price by the

                                       15

<PAGE>

Exercise Price in effect immediately after such adjustment of the Exercise
Price. The Company shall make a public announcement of its election to adjust
the number of Rights pursuant to this Section 11(i), indicating the record date
for the adjustment and, if known at the time, the amount of the adjustment to be
made. Such record date may be the date on which the Exercise Price is adjusted
or any day thereafter, but, if separate Right Certificates have been issued, it
shall be at least 10 days after the date of such public announcement. If
separate Right Certificates have been issued, upon each adjustment of the number
of Rights pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right Certificates
on such record date Right Certificates representing, 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, cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of such adjustment,
and upon surrender thereof if required by the Company, new Right Certificates
representing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates to be so distributed shall be issued, executed
and countersigned in the manner provided for herein (and 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 Right Certificates on the record date
specified in the public announcement.

     (j) Irrespective of any adjustment or change in the Exercise Price or the
number of one-hundredths of a Preferred Share issuable upon the exercise of one
Right, the Right Certificates theretofore and thereafter issued may continue to
express the Exercise Price per one one-hundredth of a Preferred Share and the
number of Preferred Shares issuable upon the exercise of one Right that were
expressed in the initial Right Certificates issued hereunder.

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

     (l) 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
issuance to the holder of any Right exercised after such record date of the
number of one-hundredths 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-hundredths 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 representing such holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment.

     (m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such further adjustments in the number of
one-hundredths of a Preferred Share that may be purchased upon exercise of one
Right, and such further adjustments in the Exercise Price, in addition to those
adjustments expressly required by this Section 11, as and to the extent

                                       16

<PAGE>

that the Company in its sole discretion shall determine to be advisable in order
that any (i) consolidation or subdivision of the Preferred Shares, (ii) issuance
wholly for cash of any Preferred Shares at less than the Current Market Price
thereof, (iii) issuance wholly for cash of Preferred Shares or securities that
by their terms are convertible into or exchangeable for Preferred Shares, (iv)
dividends on Preferred Shares payable in Preferred Shares or (v) issuance of
rights, options or warrants referred to in Section 11(b) hereof, hereafter made
by the Company to holders of its Preferred Shares shall not be taxable to such
stockholders.

     (n) In the event that the Company shall, at any time after the Close of
Business on the Record Date and prior to the Close of Business on the earliest
of the date of the first Section 11(a)(ii) Event, the date of the first Section
13(a) Event, the Redemption Date or the Rights Expiration Date, (i) pay any
dividend on the Common Shares payable in Common Shares, (ii) subdivide the
outstanding Common Shares, (iii) combine the outstanding Common Shares into a
smaller number of Common Shares or (iv) issue Common Shares in a
reclassification of the Common Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
or surviving corporation), then, and upon each such event, the Exercise Price to
be in effect after such event shall be determined by multiplying the Exercise
Price in effect immediately prior to such event by a fraction, the numerator of
which shall be equal to the number of Common Shares outstanding immediately
prior to such event and the denominator of which shall be equal to the number of
Common Shares outstanding immediately after such event. Successive adjustments
shall be made pursuant to this Section 11(n) each time such a dividend is paid
or such a subdivision, combination or reclassification is effected. If an event
occurs that 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.

     Section 12. Certificate of Adjusted Exercise Price or Number of Shares
                 ----------------------------------------------------------
Issuable Upon Exercise of Rights. Whenever an adjustment is made as provided in
--------------------------------
Section 11 hereof, the Company shall promptly (a) prepare a certificate setting
forth such adjustment and a brief statement of the facts giving rise to such
adjustment, (b) file with the Rights Agent and with each transfer agent for the
securities issuable upon exercise of the Rights a copy of such certificate and
(c) mail a brief summary thereof to each holder of Rights in accordance with
Section 25 hereof. Notwithstanding the foregoing sentence, the failure of the
Company to make such certification or to give such notice shall not affect the
validity or the force and effect of such adjustment. Any adjustment to be made
pursuant to Sections 11 or 13 hereof shall be effective as of the date of the
event giving rise to such adjustment. The Rights Agent shall be fully protected
in relying on any such certificate and on any adjustment therein contained, and
shall not be obligated or responsible for calculating any adjustment nor shall
it be deemed to have knowledge of such an adjustment unless and until it shall
have received such certificate.

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

     (a) In the event (a "Section 13(a) Event") that, at any time on or after
the 15% Ownership Date and prior to the earlier of the Redemption Date or the
Rights Expiration Date, (1) the Company shall, directly or indirectly,
consolidate with or merge with and into any other Person and the Company shall
not be the continuing or surviving corporation in such

                                       17

<PAGE>

consolidation or merger, (2) any Person shall, directly or indirectly,
consolidate with or merge with and into the Company and the Company shall be the
continuing or surviving corporation in such merger and, in connection with such
merger, all or part of the Common Shares shall be changed into or exchanged for
stock or other securities of any Person or cash or any other property, or (3)
the Company and/or any one or more of its Subsidiaries shall, directly or
indirectly, sell or otherwise transfer, in one or more transactions (other than
transactions in the ordinary course of business), assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person or Persons other than the Company
or one or more of its wholly-owned Subsidiaries (such Persons, together with the
Persons described in clauses (1) and (2) above shall be collectively referred to
in this Section as the "Surviving Person"), then, and in each such case, proper
provision shall be made so that:

          (i) except as provided in Section 7(d) hereof, each holder of a Right
     shall thereafter have the right to receive, upon the exercise thereof in
     accordance with the terms of this Agreement and payment of the then current
     Exercise Price, in lieu of the securities or other property otherwise
     purchasable upon such exercise, such number of validly authorized and
     issued, fully paid and nonassessable Common Shares of the Surviving Person
     as shall be equal to a fraction, the numerator of which is:

               (A) if a Section 11(a)(ii) Event has not occurred prior to such
          Section 13(a) Event, the product of the then current Exercise Price
          multiplied by the number of one-hundredths of a Preferred Share
          purchasable upon the exercise of one Right immediately prior to the
          first Section 13(a) Event (or, if the Distribution Date shall not have
          occurred prior to the date of such Section 13(a) Event, the number of
          one-hundredths of a Preferred Share that would have been so
          purchasable if the Distribution Date had occurred on the Business Day
          immediately preceding the date of such Section 13(a) Event), or

               (B) if a Section 11(a)(ii) Event has occurred prior to such
          Section 13(a) Event, the product of the Exercise Price in effect
          immediately prior to such Section 11(a)(ii) Event multiplied by the
          number of one-hundredths of a Preferred Share purchasable upon the
          exercise of one Right immediately prior to such Section 11(a)(ii)
          Event (or, if the Distribution Date shall not have occurred prior to
          the date of such Section 11(a)(ii) Event, the number of one-hundredths
          of a Preferred Share that would have been so purchasable if the
          Distribution Date had occurred on the Business Day immediately
          preceding the date of such Section 11(a)(ii) Event),

     and the denominator of which is 50% of the Current Market Price per Common
     Share of the Surviving Person on the date of consummation of such Section
     13(a) Event;

          (ii) the Surviving Person shall thereafter be liable for and shall
     assume, by virtue of such consolidation, merger, sale or transfer, all the
     obligations and duties of the Company pursuant to this Agreement;

                                       18

<PAGE>

          (iii) the term "Company" shall thereafter be deemed to refer to the
     Surviving Person; and

          (iv) the Surviving Person shall take such steps (including, but not
     limited to, the reservation of a sufficient number of its Common Shares in
     accordance with Section 9 hereof) in connection with such consummation as
     may be necessary to ensure that the provisions hereof shall thereafter be
     applicable to its Common Shares thereafter deliverable upon the exercise of
     Rights.

     (b) Notwithstanding the foregoing, if the Section 13(a) Event is the sale
or transfer in one or more transactions of assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole), but less than 100% thereof, then each Person acquiring all
or a portion thereof shall assume the obligations of the Company as to a
fraction of each of the Rights equal to the fraction of the assets of the
Company and its Subsidiaries (taken as a whole) acquired by such Person, and the
obligations of the Company as to the remaining fraction of each of the Rights
shall continue to be the obligations of the Company.

     (c) The Company shall not consummate a Section 13(a) Event unless prior
thereto the Company and the Surviving Person shall have executed and delivered
to the Rights Agent a supplemental agreement confirming that such Surviving
Person shall, upon consummation of such Section 13(a) Event, assume this
Agreement in accordance with Section 13 hereof, that all rights of first refusal
or preemptive rights in respect of the issuance of Common Shares of such
Surviving Person upon exercise of outstanding Rights have been waived and that
such Section 13(a) Event shall not result in a default by such Surviving Person
under this Agreement, and further providing that, as soon as practicable after
the date of consummation of such Section 13(a) Event, such Surviving Person
shall:

          (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, 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 Rights Expiration Date, and similarly
     comply with all applicable state securities laws;

          (ii) use its best efforts to list (or continue the listing of) the
     Rights and the Common Shares of the Surviving Person purchasable upon
     exercise of the Rights on a national securities exchange, or use its best
     efforts to cause the Rights and such Common Shares to meet the eligibility
     requirements for quotation on NASDAQ; and

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

     (d) In the event that at any time after the occurrence of a Section
11(a)(ii) Event some or all of the Rights shall not have been exercised pursuant
to Section 11 hereof prior to the date

                                       19

<PAGE>

of a Section 13(a) Event, such Rights shall thereafter be exercisable only in
the manner described in Section 13(a) hereof. In the event that a Section
11(a)(ii) Event occurs on or after the date of a Section 13(a) Event, Rights
shall not be exercisable pursuant to Section 11 hereof but shall instead be
exercisable pursuant to, and only pursuant to, this Section 13.

     (e) The provisions of this Section 13 shall apply to each successive
merger, consolidation, sale or other transfer constituting a Section 13(a)
Event.

     Section 14. Fractional Rights and Fractional Shares.
                 ---------------------------------------

     (a) The Company shall not be required to issue fractions of Rights or to
distribute Right Certificates that represent fractional Rights. If the Company
shall determine not to issue such fractional Rights, the Company shall pay to
the registered holders of the Right Certificates with respect to which such
fractional Rights would otherwise be issuable, at the time such fractional
Rights would otherwise have been issued as provided herein, an amount in cash
equal to the same fraction of the Current Market Price of a whole Right on the
Business Day immediately prior to the date upon which such fractional Rights
would otherwise have been issuable.

     (b) The Company shall not be required to issue fractions of Common Shares
or Preferred Shares upon exercise of Rights (other than fractions that are
integral multiples of one one-hundredth of a Preferred Share), or to distribute
certificates that represent fractional Common Shares or Preferred Shares (other
than fractions that are integral multiples of one one-hundredth of a Preferred
Share). Fractions of Preferred Shares in integral multiples of one one-hundredth
of a Preferred Share may, at the election of the Company, be represented 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 Preferred
Shares. If the Company shall determine not to issue fractional Common Shares or
Preferred Shares (or depositary receipts in lieu of Preferred Shares), the
Company shall pay to the registered holders of Right Certificates to whom such
fractional Common Shares or Preferred Shares would otherwise be issuable, at the
time such Rights are exercised as provided herein, an amount in cash equal to
the same fraction of the Current Market Price of a whole Common Share or
Preferred Share, as the case may be. For purposes of this Section 14(b), the
Current Market Price of a whole Common Share or Preferred Share shall be the
Closing Price per share for the Trading Day immediately prior to the date of
such exercise.

     (c) The holder of a Right, by the acceptance of such Right, expressly
waives such holder's right to receive any fractional Rights or any fractional
Common Shares or Preferred Shares upon exercise of such Right, except as
permitted by this Section 14.

     Section 15. Rights of Action. All rights of action in respect of this
                 ----------------
Agreement, except the rights of action given to the Rights Agent under Section
18 hereof, are vested in the respective registered holders of the Right
Certificates and certificates for Common Shares representing Rights, and any
registered holder of any Right Certificate or of such certificate for Common
Shares, without the consent of the Rights Agent or of the holder of any other
Right Certificate or any other certificate for Common Shares may, in such
holder's own behalf and for

                                       20

<PAGE>

such holder's own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise act in respect
of, such holder's right to exercise the Rights represented by such Right
Certificate or by such certificate for Common Shares in the manner provided in
such 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 shall be entitled to specific performance, and
injunctive relief against actual or threatened violations, of the obligations of
any Person under this Agreement.

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

     (a) prior to the Distribution Date, the Rights shall be represented by
certificates for Common Shares registered in the name of the holders of such
Common Shares (which certificates for Common Shares shall also constitute Right
Certificates), and each such Right shall be transferable only in connection with
the transfer of such Common Shares;

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

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

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

     Section 17. Right Holder and Right Certificate Holder Not Deemed a
                 ------------------------------------------------------
Stockholder. No holder, as such, of any Right or Right Certificate shall be
-----------
entitled to vote, receive dividends or be deemed for any purpose the holder of
the securities of the Company that may at any time be issuable upon the exercise
of the Rights represented thereby, nor shall anything contained herein or in any
Right Certificate be construed to confer upon the holder of any Right or Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, to give or withhold consent to any
corporate action, to receive notice of meetings or other actions

                                       21

<PAGE>

affecting stockholders (except as provided in Section 25 hereof), or to receive
dividends or subscription rights, or otherwise, in each case until such Right or
the Rights represented by such Right Certificate shall have been exercised in
accordance with the provisions hereof.

     Section 18. Concerning the Rights Agent.
                 ---------------------------

     (a) The Company shall pay to the Rights Agent as compensation for all
services rendered by the Rights Agent hereunder such fees as the Company and the
Rights Agent have agreed upon in writing (by confirming letter or otherwise) or,
if no such agreement has been made, reasonable and customary fees and expenses
including any 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 the Rights Agent
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 arising under this Agreement.The
indemnification provided for hereunder shall survive the expiration of the
Rights and the termination of this Agreement.

     (b) The Rights Agent may conclusively rely upon and shall be protected and
shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this Agreement in
reliance upon any Right Certificate or certificate for Preferred Shares or
Common Shares or for other securities of the Company, instrument of assignment
or transfer, power of attorney, endorsement, affidavit, letter, notice,
direction, consent, certificate, statement or other paper or document believed
by it to be genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons, or otherwise upon the advice of
its counsel as set forth in Section 20 hereof.

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

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

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

                                       22

<PAGE>

any successor Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the successor Rights
Agent; and in all such cases such Right Certificates shall have the full force
provided in such Right Certificate and in this Agreement.

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

     Section 20. Duties of Rights Agent. The Rights Agent undertakes the duties
                 ----------------------
and obligations imposed by this Agreement (and no implied duties or obligations
shall be read into this Agreement against the Rights Agent) upon the following
terms and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance of the Rights, shall be bound:

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

     (b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking 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 Treasurer, 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 Right
Certificates (except its countersignature thereof), or be required to verify the
same, but all such statements and recitals are and shall be deemed to have been
made by the Company only.

     (e) The Rights Agent shall not be under any responsibility in respect of
the validity of this Agreement or the execution and delivery hereof (except the
due authorization, execution and delivery hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall the Rights Agent be responsible for any
breach by the Company of any covenant or condition contained in this Agreement
or in any

                                       23

<PAGE>

Right Certificate; nor shall the Rights Agent be responsible for any change in
the exercisability of the Rights (including any Rights becoming null and void
pursuant to Section 7(d) hereof) or any adjustment in the terms of the Rights
(including the manner, method or amount thereof) provided for in Sections 7, 11,
13 and 23 hereof, or the ascertaining of the existence of facts that would
require any such change or adjustment (except with respect to the exercise of
Rights represented by Right Certificates after actual notice that such change or
adjustment is required); nor shall the Rights Agent by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any Preferred Shares or Common Shares or other securities to be
issued pursuant to this Agreement or any Right Certificate, or as to whether any
Preferred Shares or Common Shares or other securities 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 President,
any Vice President, the Chief Financial Officer, the Secretary or the Treasurer
of the Company, and to apply to such officers for advice or instructions in
connection with its duties under this Agreement, and the Rights Agent shall not
be liable for any action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer 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 Agreement and the date on 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 ten 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 from the Company in
response to such application to the contrary.

     (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 take a pecuniary interest in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not the Rights Agent under
this Agreement. Nothing herein shall preclude the Rights Agent from acting in
any other capacity for the Company or for any other Person.

     (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

                                       24

<PAGE>

such act, default, neglect or misconduct, provided that reasonable care was
exercised in the selection and continued employment thereof.

     (j) The Rights Agent shall not be required to take notice or be deemed to
have notice of any fact, event or determination (including, without limitation,
any dates or events defined in this Agreement or the designation of any Person
as a 15% Stockholder, Affiliate or Associate) under this Agreement unless and
until the Rights Agent is specifically notified in writing by the Company of
such fact, event or determination.

     (k) If, with respect to any Rights Certificate surrendered to the Rights
Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case may be, has not been
completed, the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with the Company.

     Section 21. Change of Rights Agent. The Rights Agent or any successor
                 ----------------------
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30-days' advance notice in writing mailed to the Company and to each
transfer agent of the Common Shares and Preferred Shares by registered or
certified mail, and, at the expense of the Company to the holders of the Right
Certificates by first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30-days' advance notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Shares and Preferred Shares by registered or certified mail,
and to the holders of the Right Certificates by first-class mail. If the Rights
Agent shall resign or be removed or shall otherwise become incapable of acting
as such, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who shall, with such notice, submit such
holder's Right Certificate for inspection by the Company), then the Company
shall become the Rights Agent and the registered holder of any Right Certificate
may apply to any court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed by the Company or by
such a court, shall be a corporation organized, in good standing and doing
business under the laws of the United States or of the States of New York or
California (or of any other state of the United States so long as such
corporation is authorized to do business as a banking institution in the States
of New York or California), with a principal office in New York or California,
that is authorized under such laws to exercise corporate trust or stock transfer
powers and is subject to supervision or examination by federal or state
authority and that has at the time of its appointment as Rights Agent a combined
capital and surplus of at least $50,000,000. After appointment, the successor
Rights Agent 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 the predecessor
Rights Agent hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose of this Agreement and so that
the successor Rights Agent may appropriately act as Rights Agent hereunder. Not
later than the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Common Shares and Preferred Shares, and mail a

                                       25

<PAGE>

notice thereof in writing to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section 21, however, or any
defect therein, shall not affect the legality or validity of the resignation or
removal of the predecessor Rights Agent or the appointment of the successor
Rights Agent, as the case may be.

     Section 22. Issuance of New Right Certificates. Notwithstanding any of the
                 ----------------------------------
provisions of this Agreement or of the Right Certificates to the contrary, the
Company may, at its option, issue new Right Certificates in such form as may be
approved by the Board of Directors in order 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 upon exercise of the Rights in accordance
with the provisions of this Agreement.

     Section 23. Redemption of Rights.
                 --------------------

     (a) Until the earliest of (i) the date of the first Section 11(a)(ii)
Event, (ii) the date of the first Section 13(a) Event or (iii) the Rights
Expiration Date, the Board of Directors of the Company may, at its option,
authorize and direct the redemption of all, but not less than all, of the then
outstanding Rights at a redemption price of $.001 per Right, as such redemption
price shall be appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date hereof (the "Redemption Price"),
and the Company shall so redeem the Rights.

     (b) Immediately upon the action of the Board of Directors of the Company
authorizing and directing the redemption of the Rights pursuant to subsection
(a) of this Section 23, or at such time and date thereafter as the Board of
Directors of the Company may specify, and without any further action and without
any notice, the right to exercise Rights shall terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price.
Within ten Business Days after the date of such action, the Company shall give
notice of such redemption to the holders of Rights by mailing such notice to all
holders of Rights at their last addresses as they appear upon the registry books
of the Rights Agent or, if prior to the Distribution Date, on the registry books
of the transfer agent for the Common Shares. Any notice that is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives
such notice, provided, however, that neither the failure to give any such notice
             --------  -------
nor any defect therein shall affect the legality or validity of such redemption.
Each such notice of redemption shall state the method by which the payment of
the Redemption Price will be made. Neither the Company nor any of its Affiliates
or Associates may, directly or indirectly, redeem, acquire or purchase for value
any Rights in any manner other than (i) in the manner specifically set forth in
Section 24 hereof, (ii) in the manner specifically set forth in this Section 23,
or (iii) in connection with the purchase of Common Shares prior to the earlier
of the date of the first Section 11(a)(ii) Event or the date of the first
Section 13(a) Event.

     (c) The Company may, at its option, pay the Redemption Price in cash,
Common Shares, Preferred Shares, other equity securities of the Company, debt
securities of the Company, other property or any combination of the foregoing,
in each case having an aggregate Current Market Price on the Redemption Date
equal to the Redemption Price.

                                       26

<PAGE>

     Section 24. Exchange of Rights.
                 ------------------

     (a) At any time during the period of 180 days after a Section 11(a)(ii)
Event, the Board of Directors of the Company may, at its option, authorize and
direct the exchange of all, but not less than all, of the then outstanding
Rights (other than Rights that have become null and void pursuant to Section
7(d)) for Common Shares, one one-hundredths of Preferred Shares, debt securities
of the Company, other property, or any combination of the foregoing, in each
case having an aggregate Current Market Price per Right equal to the result
obtained by (i) multiplying the Current Market Price per Common Share on the
record date for such exchange by the number of Common Shares for which a Right
is exercisable on such record date and (ii) subtracting from such product the
Exercise Price on such Record Date (the "Exchange Ratio"), and the Company shall
so exchange the Rights.

     (b) Immediately upon the action of the Board of Directors of the Company
authorizing and directing the exchange of the Rights pursuant to Section 24(a),
or at such time and date thereafter as the Board of Directors of the Company may
specify, and without any further action and without any notice, the right to
exercise Rights shall terminate and the only right thereafter of the holders of
Rights shall be to receive the securities and other property described in
Section 24(a) in accordance with the Exchange Ratio. Within ten Business Days
after the date of such action, the Company shall give notice of such exchange to
the holders of Rights by mailing such notice to all holders of Rights at their
last addresses as they appear upon the registry books of the Rights Agent or, if
prior to the Distribution Date, on the registry books of the transfer agent for
the Common Shares. Any notice that is mailed in the manner herein provided shall
be deemed given, whether or not the holder receives such notice, but neither the
failure to give any such notice nor any defect therein shall affect the legality
or validity of such exchange. Each such notice of exchange shall state the
method by which the Rights will be exchanged.

     (c) Notwithstanding the foregoing, in the event that the Board of Directors
directs the exchange of the outstanding Rights for Common Shares but the
aggregate number of Common Shares that are authorized by the Company's
Certificate of Incorporation, as amended from time to time, but not outstanding
or reserved for issuance for purposes other than upon exercise or exchange of
the Rights is less than the aggregate number of Common Shares issuable upon the
exchange of the Rights in accordance with this Section 24 (the excess of such
number of authorized Common Shares over and above such number of issuable Common
Shares being hereinafter referred to as the "Unavailable Exchange Shares"), then
the Company shall substitute for the pro rata portion of the Unavailable
Exchange Shares that would otherwise be issuable upon the exchange of the Rights
in accordance with this Section 24 (i) cash, (ii) other equity securities of the
Company (including, without limitation, Common Share Equivalents), (iii) debt
securities of the Company, (iv) other property or (v) any combination of the
foregoing, in each case having an aggregate Current Market Price equal to the
aggregate Current Market Price of the Unavailable Exchange Shares for which
substitution is made. Subject to Section 7(d) hereof, in the event that the
Company takes any action pursuant to this Section 24, such action shall apply
uniformly to all outstanding Rights.

                                       27

<PAGE>

     Section 25. Notice of Certain Events.
                 ------------------------

     (a) In the event that the Company shall propose (i) to declare or pay any
dividend on or make any distribution with respect to its Common Shares or
Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer
to the holders of its Common Shares or Preferred Shares options, rights or
warrants to subscribe for or to purchase any additional shares thereof or shares
of stock of any class or any other securities, rights or options, (iii) to
effect any reclassification of its Common Shares or Preferred Shares (other than
a reclassification involving only the subdivision of outstanding shares), (iv)
to effect any consolidation or merger with or into, or to effect any sale or
other transfer (or to permit one or more of its Subsidiaries to effect any sale
or other transfer), in one or more transactions, of more than 50% of the assets
or earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person or Persons, or (v) to effect the liquidation, dissolution or
winding up of the Company, then and in each such case, the Company shall give to
each holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of such proposed action that shall specify the record date for the
purpose of such dividend or distribution, or the date upon which such
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution or winding up is to take place and the date of participation therein
by the holders of record of the Common Shares or Preferred Shares, if any such
date is to be fixed, and such notice shall be so given in the case of any action
covered by clause (i) or (ii) above at least 20 days prior to the record date
for determining holders of the Common Shares or Preferred Shares for purposes of
such action, and in the case of any such other action, at least 20 days prior to
the earlier of the date of the taking of such proposed action or the date of
participation therein by the holders of the Common Shares or Preferred Shares.
The failure to give the notice required by this Section 25 or any defect therein
shall not affect the legality or validity of the action taken by the Company or
the vote upon any such action.

     (b) Upon the occurrence of each Section 11(a)(ii) Event and each Section
13(a) Event, the Company shall as soon as practicable thereafter give to each
holder of a Right Certificate, in accordance with Section 26 hereof, a notice of
the occurrence of such event, specifying the event and the consequences of the
event to holders of Rights under Sections 11 and 13 hereof.

     Section 26. Notices. Notices or demands authorized by this Agreement to be
                 -------
given or made by the Rights Agent or by the holder of any Right 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:

                           Standard Pacific Corp.
                           15326 Alton Parkway
                           Irvine, CA  92618
                           Attention: Corporate Secretary

Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made to or on the Rights Agent (i) by the
Company shall be sufficiently given or made if sent, postage prepaid, by
registered or certified mail, addressed to the principal office of the Rights
Agent as set forth below (until another address is filed in writing with the
Company) or (ii) by the holder of any Right Certificate shall be sufficiently

                                       28

<PAGE>

given or made if sent by first-class mail, postage prepaid, addressed to the
principal office of the Rights Agent as set forth below (until another address
is filed in writing with the Company), and shall be deemed given upon actual
receipt.

                           EquiServe Trust Company, N.A.
                           525 Washington Boulevard
                           Third Floor
                           Jersey City, New Jersey  07310
                           Attention: Corporate Events

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

     Section 27. Supplements and Amendments.
                 --------------------------

     (a) The Board of Directors of the Company may, from time to time, without
the approval of any holders of Rights, supplement or amend any provision of this
Agreement in any manner, whether or not such supplement or amendment is adverse
to any holder of Rights, and direct the Rights Agent to so supplement or amend
such provision, and the Rights Agent shall so supplement or amend such
provision; provided, however, that from and after the earliest of (i) the date
           --------  -------
of the first Section 11(a)(ii) Event, (ii) the date of the first Section 13(a)
Event, (iii) the Redemption Date or (iv) the Expiration Date, this Agreement
shall not be supplemented or amended in any manner that would materially and
adversely affect any holder of outstanding Rights other than a 15% Stockholder
or a Surviving Person.

     (b) From and after the earlier of the date of the first Section 11(a)(ii)
Event or the date of the first Section 13(a) Event and prior to the Rights
Expiration Date, the Company shall not effect any amendment to the Certificate
of Designations for the Preferred Shares that would materially and adversely
affect the rights, privileges or preferences of the Preferred Shares without the
prior approval of the holders of two-thirds or more of the then outstanding
Rights. Notwithstanding anything in this Agreement to the contrary, no
supplement or amendment that changes the rights and duties of the Rights Agent
under this Agreement in any manner adverse to the Rights Agent will be effective
against the Rights Agent without the execution of such supplement or amendment
by the Rights Agent.

     Section 28. Certain Covenants. Subject to Section 27 hereof and the other
                 -----------------
provisions of this Agreement, from and after the earlier of the date of the
first Section 11(a)(ii) Event or the date of the first Section 13(a) Event and
prior to the earlier of the Redemption Date or the Rights Expiration Date, the
Company shall not (a) issue or sell, or permit any Subsidiary to issue or sell,
to a 15% Stockholder or a Surviving Person, or any Affiliate or Associate of a
15% Stockholder or a Surviving Person, or any Person holding Voting Shares of
the Company that are Beneficially Owned by a 15% Stockholder or a Surviving
Person, (i) any rights, options, warrants or convertible securities on terms
similar to, or that materially adversely affect the value of, the Rights or (ii)
Preferred Shares, Common Shares or shares of any other class of capital stock,
if

                                       29

<PAGE>

such sale is intended to or would materially adversely affect the value of the
Rights, or (b) take any other action that is intended to or would materially
adversely affect the value of the Rights.

     Section 29. 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 permitted assigns hereunder.

     Section 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 Right Certificates (other than those representing
Rights that have become null and void) and the certificates for Common Shares
representing Rights (other than those Rights that have become null and void) any
legal or equitable right, remedy or claim under this Agreement, and this
Agreement shall be for the sole and exclusive benefit of the Company, the Rights
Agent and such registered holders of Right Certificates and certificates for
Common Shares representing Rights.

     Section 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.

     Section 32. Governing Law. This Agreement and each Right Certificate issued
                 -------------
hereunder shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be governed by and construed in accordance
with the laws of such state applicable to contracts made and performed entirely
within such state, except as to the rights and obligations of the Rights Agent
which shall be governed by and construed in accordance with the laws of the
State of New York.

     Section 33. Counterparts. This Agreement may be executed by facsimile and
                 ------------
in two or more counterparts, each of which shall be deemed to be an original and
all of which when taken together shall constitute one and the same instrument.

     Section 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.

                                       30

<PAGE>

     Section 35. Determination and Actions by the Board of Directors. The Board
                 ---------------------------------------------------
of Directors shall have the exclusive power and authority to administer this
Agreement and to exercise the rights and powers specifically granted to the
Board of Directors or to the Company (subject to any express limitations of or
conditions to such power, authority and rights set forth in this Agreement)
hereunder. All such actions, calculations, interpretations and determinations
that are done or made by the Board of Directors in good faith shall be final,
conclusive and binding on the Company, the Rights Agent, the holders of the
Rights, as such, and all other applicable Persons.

                            [signature page follows]

                                       31

<PAGE>

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

STANDARD PACIFIC CORP.

Attest:

By:  /s/ Andrew Parnes                        By:  /s/ Clay Halvorsen
   -----------------------------                 -----------------------------
   Name: Andrew H. Parnes                        Name: Clay A. Halvorsen
   Title: Senior Vice President-                 Title: Senior Vice President,
          Finance and Chief                             General Counsel and
          Financial Officer                             Secretary

EQUISERVE TRUST COMPANY, N.A., as
Rights Agent

Attest:

By:  /s/ Collin Ekeogu                        By:  /s/ Anthony Milo
   -----------------------------                 -----------------------------
   Name: Collin Ekeogu                           Name: Anthony Milo
   Title: Director                               Title: Managing Director

                                       32

<PAGE>

                                    EXHIBIT A

                            Form of Right Certificate

Certificate No. _____                                          __________ Rights

     THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE NOT EXERCISABLE AFTER THE
     LATER OF (1) DECEMBER 31, 2011 OR (2) THE TENTH ANNIVERSARY OF THE
     DISTRIBUTION DATE (AS THAT TERM IS DEFINED IN THE RIGHTS AGREEMENT). IN
     ADDITION, THE RIGHTS ARE SUBJECT TO REDEMPTION (AFTER WHICH TIME THEY WILL
     NOT BE EXERCISABLE) AT $.001 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS
     AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY A 15%
     STOCKHOLDER OR AN AFFILIATE OR ASSOCIATE OF A 15% STOCKHOLDER (AS SUCH
     TERMS ARE DEFINED IN THE RIGHTS AGREEMENT AND AS THOSE CIRCUMSTANCES ARE
     SPECIFIED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS
     MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT CERTIFICATE
     WERE ISSUED TO A PERSON WHO WAS A 15% STOCKHOLDER OR AN AFFILIATE OR
     ASSOCIATE OF A 15% STOCKHOLDER. THIS RIGHT CERTIFICATE AND THE RIGHTS
     REPRESENTED HEREBY MAY BECOME VOID IN THE CIRCUMSTANCES SPECIFIED IN THE
     RIGHTS AGREEMENT.]*

                                Right Certificate

                             STANDARD PACIFIC CORP.
                            (a Delaware corporation)

     This certifies that _______________________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement dated as of December 31, 2001 (the "Rights Agreement") between
Standard Pacific Corp., a Delaware corporation (the "Company"), and EquiServe
Trust Company, N.A., a federally chartered trust company (the "Rights Agent"),
to purchase from the Company at any time after the Distribution Date (as such
---------------------
*    That portion of the legend in brackets shall be inserted only if applicable
     and shall replace the preceding sentence.

                                       33

<PAGE>

term is defined in the Rights Agreement) and prior to 5:00 P.M., New York time,
on the later of December 31, 2011 or the tenth anniversary of the Distribution
Date at the office or agency of the Rights Agent at EquiServe Trust Company,
N.A., 525 Washington Boulevard, Third Floor, Jersey City, New Jersey 07310, or
at the office of its successors as Rights Agent, one one-hundredth of a fully
paid non-assessable share of Series A Junior Participating Cumulative Preferred
Stock, $.01 par value (the "Preferred Shares"), of the Company, at an exercise
price of $115 per Right (the "Exercise Price"), upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Right Certificate (and the number of
Preferred Shares that may be purchased upon exercise thereof) set forth above,
and the Exercise Price per share set forth above, are the number and Exercise
Price as of December 31, 2001, based on the Preferred Shares as constituted at
such date.

     As provided in the Rights Agreement, the Exercise Price and the number of
Preferred Shares that may be purchased upon the exercise of the Rights evidenced
by this Right Certificate are subject to modification and adjustment upon the
happening of certain events. This Right Certificate is subject to all of the
terms, provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by reference and made a
part hereof and to which Rights Agreement reference is hereby made for a full
description of the rights, limitations of rights, obligations, duties and
immunities hereunder of the Rights Agent, the Company and the holders of the
Rights Certificates. Copies of the Rights Agreement are on file at the principal
executive offices of Standard Pacific Corp. and the above-mentioned offices of
the Rights Agent.

     This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent at EquiServe Trust Company, N.A.,
525 Washington Boulevard, Third Floor, Jersey City, New Jersey 07310, may be
exchanged for another Right Certificate or Right Certificates of like tenor and
date evidencing Rights entitling the holder to purchase a like aggregate number
of Preferred Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be entitled to
receive upon surrender hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised. Subject to the provisions of the
Rights Agreement, the Rights evidenced by this Certificate may, but are not
required to, be redeemed by the Company at a redemption price of $.001 per
Right.

     No fractional Preferred Shares will be issued upon the exercise of any
Right or Rights evidenced hereby (other than fractions that are integral
multiples of one one-hundredth of a Preferred Share, which may, at the election
of the Company, be evidenced by depositary receipts), but in lieu thereof, a
cash payment will be made, as provided in the Rights Agreement.

     No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of the Preferred Shares or of
any other securities of the Company that may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting stockholders

                                       2

<PAGE>

(except as provided in the Rights Agreement), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights evidenced by this
Right Certificate shall have been exercised as provided in the Rights Agreement.

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

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

STANDARD PACIFIC CORP.

ATTEST:

----------------------------                           -------------------------
Secretary                                              President

Countersigned:

EQUISERVE TRUST COMPANY, N.A.,
as Rights Agent

By:
       --------------------------------------------

Title:
       --------------------------------------------

                                       3

<PAGE>

                    Form of Reverse Side of Right Certificate

                               FORM OF ASSIGNMENT
                               ------------------

                (To be executed by the registered holder if such
               holder desires to transfer the Right Certificate.)

         FOR VALUE RECEIVED _______________________________________ hereby
sells, assigns and transfers unto___________________________________________

--------------------------------------------------------------------------------
                  (Please print name and address of transferee)

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

Dated:  ____________________, ____

                                          -------------------------------------
                                          Signature

Signature Guaranteed:

         Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc. or a commercial bank or trust company having an office or correspondent in
the United States.

--------------------------------------------------------------------------------

The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not Beneficially Owned by a 15% Stockholder or an Affiliate or
Associate thereof (as defined in the Rights Agreement).

                                          --------------------------------------
                                          Signature

                                          (Signature must conform in all
                                          respects to name of holder as
                                          specified on the face of this Right
                                          Certificate in every particular,
                                          without alteration or enlargement or
                                          any change whatsoever)

--------------------------------------------------------------------------------

                                       4

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

                          FORM OF ELECTION TO PURCHASE
                          ----------------------------

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

TO STANDARD PACIFIC CORP.:

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

                (please print name, address and social security,
                 tax identification or other identifying number:

                -------------------------------------------------

                -------------------------------------------------

                -------------------------------------------------

                -------------------------------------------------

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

                (please print name, address and social security,
                 tax identification or other identifying number:

                -------------------------------------------------

                -------------------------------------------------

                -------------------------------------------------

                -------------------------------------------------

Dated:
        ----------------------------

                                         ---------------------------------------
                                         Signature

                                         (Signature must conform in all respects
                                         to name of holder as specified on the
                                         face of this Right Certificate in
                                         every particular, without alteration
                                         or enlargement or any change
                                         whatsoever)

                                       5

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

Signature Guarantee:

         Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc. or a commercial bank or trust company having an office or correspondent in
the United States.

--------------------------------------------------------------------------------

The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not Beneficially Owned by a 15% Stockholder or an Affiliate or
Associate thereof (as defined in the Rights Agreement).

                                          --------------------------------------
                                          Signature

                                          (Signature must conform in all
                                          respects to name of holder as
                                          specified on the face of this Right
                                          Certificate in every particular,
                                          without alteration or enlargement or
                                          any change whatsoever)

--------------------------------------------------------------------------------

                                     NOTICE
                                     ------

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

     In the event the certification set forth above in the Forms of Assignment
and Election is not completed, the Company will deem the Beneficial Owner of the
Rights evidenced by this Right Certificate to be a 15% Stockholder or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and, in the
case of an Assignment, will affix a legend to that effect on any Right
Certificates issued in exchange for this Right Certificate.

                                       6

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