Document:

EXHIBIT 10.4

                          FORBEARANCE AGREEMENT

     Forbearance Agreement ("Agreement") made this 10th day of April, 2001,
between MARGATE INDUSTRIES, INC., a Delaware corporation ("Margate"),
WESLEY INDUSTRIES, INC., a Michigan corporation ("Wesley"), and NEW HAVEN
FOUNDRY, a Michigan corporation ("Foundry").

                            R E C I T A L S:
                            - - - - - - - -

     A.   Wesley is indebted to Margate pursuant to the terms of a Seller
          Note dated March 24, 1998 ("Seller Note"), in the original
          principal amount of $700,000 which provides for quarterly
          principal payments of $35,000 each, plus interest as provided
          therein.

     B.   The Seller Note is secured by 29,682 shares of capital stock of
          the Foundry constituting 45% of the outstanding capital stock of
          the Foundry (the "Pledged Shares") pursuant to the terms of a
          Pledge Agreement dated March 24, 1998 ("Pledge Agreement").

     C.   Wesley and Foundry are parties to a Cleaning Contract dated March
          24, 1998 ("Cleaning Contract"), pursuant to which, among other
          things:

          i.   Margate has the exclusive right to provide cleaning services
               as set forth in the Cleaning Contract for the minimum 7-year
               term of the Cleaning Contract on the payment terms as set
               forth in the Cleaning Contract; and

          ii.  Foundry is indebted to Margate for the payment of a "Service
               Fee" in the original principal amount of $2,800,000 which is
               payable quarterly in the amount of $140,000, plus interest
               on delinquent amounts as provided therein.

     D.   Payment of the Service Fee under Section 4(C) of the Cleaning
          Contract is also secured by the Pledged Shares under the Pledge
          Agreement.

     E.   The Foundry is also indebted to Margate and/or its subsidiary,
          Yale Industries, Inc., according to the following instruments and
          agreements

          i.   A Management Oversight Fee in the total amount of $147,600
               payable at the rate of $6,150 per month with payments due on
               the 15th day of each month through January 15, 2002; and

<PAGE>
          ii.  The Accounts Receivable Note in the original principal
               amount of $700,000 payable in installments of $32,250 per
               month payable on the first day of each month through
               February 1, 2002; and

          iii. Rent payments for the painting room at the Yale Industries,
               Inc. ("Yale") facility in Yale, Michigan, of $4,167 per
               month base rent plus a percentage of sales payable on the
               first day of each month;

          iv.  Weekly labor paid on Friday of each week; and

          v.   Monthly health insurance payments for William Hopton.

     F.   Foundry is in default under the Cleaning Contract for failure to
          make the last four quarterly installment payments of the Service
          Fee in the total amount of $560,000 (four payments of $140,000
          each due on July 1, 2000, October 1, 2000, January 1, 2001 and
          April 1, 2001, respectively) ("Service Fee Payment Default") plus
          interest on the delinquent payments as set forth on Exhibit A
          attached hereto.

     G.   The Foundry is in default for failure to make the March 1
          principal payment in the amount of $35,000 due under the Seller
          Note plus interest as set forth on Exhibit A.

     H.   The Foundry is in default for failure to make the principal
          payments in the amount of $32,250 each under the Accounts
          Receivable Note due February 1, 2001, and March 1, 2001, plus
          interest as set forth on Exhibit A.

     I.   The Foundry is further in default under the Cleaning Contract and
          under various other agreements with Margate for the failure to
          make payments as designated on Exhibit A under the heading of
          "Cleaning Contract and Miscellaneous Charges"in the amounts set
          forth on Exhibit A.

     J.   Margate has provided Wesley with notice of the Service Fee
          Payment Default referenced in Recital F and pursuant to the terms
          of the Pledge Agreement and the Cure Period as provided in
          paragraph 6(C) of  the Pledge Agreement has expired without cure
          by Wesley or the Foundry.

     K.   Pursuant to paragraph 6(E) of the Pledge Agreement, Margate has
          provided Wesley with notice that Margate may retain the Pledged
          Shares as a result of the Service Fee Payment Default which has
          not been cured.

     L.   Wesley and Foundry have requested that Margate forbear from
          immediately exercising its rights and remedies under the Pledge
          Agreement and from

                                   -2-
<PAGE>
          exercising its rights and remedies with respect to the Service
          Fee Payment Default and the other defaults referenced in Recitals
          G, H and I above and Margate has agreed to do so in accordance
          with the terms and conditions set forth in this Agreement.

     NOW, THEREFORE, based upon the foregoing recitals (all of which are
incorporated into this Agreement and all of which constitute
representations, warranties and covenants of Wesley and the Foundry), the
parties hereto agree as follows:

     1.   CONDITIONS TO FORBEARANCE B PAYMENT OBLIGATIONS.  The forbearance
to be provided by Margate under this Agreement shall be subject to the
following conditions:

          (1)  LOAN CLOSING B LUMP SUM PAYMENT.  Foundry and Wesley have
               represented to Margate that they will be entering into a
               refinancing of the Foundry's credit facility with Comerica
               Bank on or before April __, 2001 (hereinafter
               "Refinancing").  Wesley and the Foundry agree that upon the
               closing of the Refinancing, Margate shall cause the Foundry
               to pay and the Foundry shall pay to Margate a lump sum
               payment in the amount of $709,838.75 to be applied to the
               charges owing to Margate under the Cleaning Contract and
               designated in Item 4 as "Total Charges" on Exhibit A
               attached hereto.

          (2)  SELLER NOTE.  On or before April 10, 2001, Wesley shall have
               paid the principal payments due March 1 2001, in the amount
               of $35,000 each under the Seller Note plus all interest
               payments due under the Seller Note as of April 1, 2001.

          (3)  ACCOUNTS RECEIVABLE NOTE.  On or before April 10, 2001,
               Wesley shall cause the Foundry to pay and the Foundry shall
               pay the principal payments due on February 1, 2001, March 1,
               2001, and April 1, 2001, under the Accounts Receivable Note
               in the amount of $32,250 each plus interest owing under the
               Accounts Receivable Note through April 1, 2001.

          (4)  ALL PAYMENTS CURRENT.  As of April 10, 2001, all payments
               owing to Margate from the Foundry under the Cleaning
               Contract (other than the Service Fee which is otherwise
               address in paragraph 2 below) shall be current within 45
               days as provided under paragraph 4(B) of the Cleaning
               Contract including, without limitation, payments for
               specials, defect analysis, salvage, scrap, shipper=s cost,
               surcharge and interest charges.

                                   -3-
<PAGE>
Upon satisfaction of the foregoing payments by Wesley and the Foundry as of
April 1, 2001, Margate shall grant Wesley and the Foundry the forbearance
as set forth in paragraph 2 below.

     2.   FORBEARANCE.  Subject to the execution and delivery of this
Agreement and the satisfaction of all conditions and compliance with all
covenants set forth in paragraph 1 above, Margate agrees to forbear from
enforcing its rights and remedies under the Pledge Agreement as a result of
the Service Fee Payment Default and agrees to defer the delinquent
quarterly payments of the Service Fee referenced in Recital E above and the
Service Fee otherwise due through January 1, 2002, as provided in paragraph
3 below.

     3.   AMENDMENT TO CLEANING CONTRACT.  The Cleaning Contract is hereby
amended as follows:

          (1)  Paragraph 4(C) of the Cleaning Contract is amended to
               provide that:

               1.   The quarterly Service Fee payments payable under
                    paragraph (C) of the Cleaning Contract through and
                    including the January 1, 2002, payment shall be
                    deferred to the following payment dates:

                      Service Fee                             Deferred
                      Payment Date                          Payment Date
                      ------------                          ------------

                      July 1, 2000        deferred to       July 1, 2003

                      October 1, 2000     deferred to       Oct. 1, 2003

                      January 1, 2001     deferred to       Jan. 1, 2004

                      April 1, 2001       deferred to       April 1, 2004

                      July 1, 2001        deferred to       July 1, 2004

                      October 1, 2001     deferred to       Oct. 1, 2004

                      January 1, 2002     deferred to       Jan. 1, 2005

                    The Service Fee payments due and payable from and after
                    April 1, 2002, through January 1, 2003, shall remain
                    payable in accordance with paragraph 4(C) of the
                    Cleaning Contract.

                                   -4-
<PAGE>
               2.   The accumulated interest on the delinquent Service Fee
                    payments due on July 1, 2000, October 1, 2000, and
                    January 1, 2001, as of the date of this Agreement shall
                    be paid in a lump sum with the final deferred Service
                    Fee payment on July 1, 2004.

               3.   Interest on the deferred Service Fee payments of April
                    1, 2001, July 1, 2001, and October 1, 2001, shall
                    commence at the rate of nine percent (9%) and shall
                    accrue from the original due date of each Service Fee
                    payment under paragraph (C) of the Cleaning Contract
                    and shall be due and payable in a lump sum on the final
                    deferred payment date of July 1, 2004.

               4.   In the event any non-deferred Service Fee payment
                    (i.e., payments due April 1, 2002, through and
                    including January 1, 2003) are not paid when due, such
                    payments shall accrue interest at eighteen percent
                    (18%) until paid.

               5.   In the event the payment of any Service Fee is not made
                    within three (3) months of the date on which it is due
                    (taking into account the deferred payment dates as
                    provided herein) Margate may at its option accelerate
                    payment of the remaining balance of the Service Fee B
                    consisting of all future installment payments whether
                    deferred or otherwise B which balance shall become
                    immediately due and owing upon providing of written
                    notice of acceleration by Margate.  Margate shall also
                    be entitled to exercise all rights and remedies
                    afforded by law or otherwise available under the Pledge
                    Agreement, this Agreement or any other agreements in
                    effect between the parties.

          (2)  Paragraph 6(A) of the Cleaning Contract is amended to
               provide that the minimum 7-year term of the Cleaning
               Contract shall be extended until the later of:  (i) March
               24, 2005; or (ii) that date which is one year after the
               payment in full of all amounts owing from the Foundry to
               Margate under all of the agreements referenced in Recitals
               A through E above.

          (3)  Yale will bill the Foundry on Tuesday of each week for the
               previous week's shipments (i.e., the preceding Monday
               through Sunday) and all additional billings.  The billed
               amount will be faxed to the accounts payable department of
               the Foundry and the Foundry will make a check in payment of
               this amount available for pickup by Yale

                                   -5-
<PAGE>
               representatives on Thursday morning of each week.
               Accompanying the weekly billings, Yale will also provide the
               Foundry with a statement of any amount exceeding 45 days as
               of the week being processed.  Such amount in excess of 45
               days will also be included by the Foundry with the previous
               week's billings and remitted to Yale on Thursday of each
               week as provided herein.

All remaining terms and conditions of the Cleaning Contract remain in
effect.

     4.   FURTHER DEFAULT.  In the event the occurrence of a payment
default under the Seller Note, Cleaning Contract, Pledge Agreement or this
Agreement (other than defaults for which forbearance has been specifically
granted herein) including the Foundry and/or Wesley's failure to pay the
amounts set forth in paragraph 1 above on or before April 10, 2001, Margate
shall be entitled to exercise all rights and remedies available to it under
any of the foregoing agreements or otherwise available to Margate under law
and the forbearance granted under this Agreement shall be deemed
terminated.

     5.   RESERVATION OF RIGHTS.  This Agreement grants a conditional and
limited forbearance only on the terms set forth herein and, accordingly,
all of Margate's rights and remedies under the Seller Note, Cleaning
Contract, Pledge Agreement (subject to the specific forbearance provided
herein with regard to the payment defaults described herein) or any other
agreements between Margate on the one hand and Wesley and/or the Foundry on
the other, are expressly reserved including, without limitation, all rights
and remedies resulting from or arising in connection with the Service Fee
Payment Default and Margate may exercise any such rights or remedies in
whole or in part, independently or in conjunction with each other and
Margate=s exercise of any such right or remedy shall not be deemed to be an
election preventing the exercise of any additional rights and remedies at
any future time.

     6.   SUCCESSORS AND ASSIGNS; THIRD-PARTY BENEFICIARY.  This Agreement
shall be binding upon and inure to the benefit of each of the parties
hereto and their respective successors and assigns.  Margate may assign its
rights and remedies under this Agreement to any of its existing
subsidiaries or any subsidiary created after the date of this Agreement
("Margate Subsidiary") and Wesley and the Foundry specifically consent to:

          (1)  The assignment by Margate of the Seller Note to any Margate
               Subsidiary such that the respective Margate Subsidiary shall
               be deemed the holder of the Seller Note for all purposes;
               and

          (2)  The assignment by Margate to any Margate Subsidiary, and the
               assumption by the respective Margate Subsidiary of all of
               Margate's under, the Pledge Agreement;

                                   -6-
<PAGE>
          (3)  The assignment by Margate to any Margate Subsidiary of all
               of Margate's rights, and the assumption by the respective
               Margate Subsidiary of all of Margate's obligations under,
               the Cleaning Contract; and

          (4)  Comerica Bank is deemed to be a third-party beneficiary of
               this Agreement.

No further written instrument or agreement other than this Agreement shall
be required in order to effectuate or evidence the consent of Wesley and
the Foundry to any such assignment or assumption.

     7    GOVERNING LAW.  This Agreement shall be governed by the laws of
the State of Michigan.

     8.   CAPITALIZED TERMS.  The terms capitalized in this Agreement shall
have the meaning provided to them under the Seller Note, Cleaning Contract
or Pledge Agreement, as applicable, unless otherwise specifically set forth
herein.

                                   MARGATE INDUSTRIES, INC., a
                                   Delaware corporation

                                   By: /s/ DAVID A. WIDLAK
                                       -------------------------------
                                        David A. Widlak
                                   Its: Secretary

                                   WESLEY INDUSTRIES, INC., a Michigan
                                   corporation

                                   By: /s/ DELBERT MULLINS
                                       -------------------------------

                                   Its: President

                                   NEW HAVEN FOUNDRY, a Michigan
                                   corporation

                                   By: /s/ DELBERT MULLINS
                                       -------------------------------

                                   Its: President

                                   -7-EXHIBIT 4.3

              ONLINE POWER SUPPLY, INC.

                       Issuer and Company

                       and

              CORPORATE STOCK TRANSFER, INC.

                       Rights Agent

                                  RIGHTS AGREEMENT

                         Rights Record Date: April 25, 2001

                                        1

<PAGE>

                                TABLE OF CONTENTS

                                                                            PAGE

Section 1.    Definitions......................................................4

Section 2.    Appointment of Rights Agent......................................7

Section 3.    Definition of Distribution Date and Offer Date;
              When Right Certificates Will Issue...............................7

Section 4.    Form of Right Certificates.......................................8

Section 5.    Countersignature and Registration................................9

Section 6.    Transfer, Split Up, Combination and Exchange
              of Right Certificates; Mutilated, Destroyed,
              Lost or Stolen Right Certificates................................9

Section 7.    Exercise of Rights; Purchase Price;
              Expiration Date of Rights.......................................10

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

Section 9.    Reservation and Availability of Shares; Registration............11

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

Section 11.   Adjustment of Purchase Price, Number and Kind of Shares
              or Number of Rights (Including Flip-In" Provision)..............12

Section 12.   Certification of Adjusted Purchase Price or
              Number of Shares................................................17

Section 13.   Consolidation, Merger or Sale or Transfer of Assets
              or Earning Power (Including "Flip-Over Provision")..............18

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

Section 15.   Rights of Action................................................21

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

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

Section 18.   Concerning the Rights Agent.....................................21

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

Section 20.   Duties of Rights Agent..........................................22

Section 21.   Change of Rights Agent..........................................24

                                        2

<PAGE>

Section 22.   Issuance of New Right Certificates..............................24

Section 23.   Redemption......................................................24

Section 24.   Notice of Proposed Actions......................................25

Section 25.   Notices in General .............................................25

Section 26.   Supplements and Amendments......................................26

Section 27.   Exchange of Rights for Shares of
              Common Stock Without Cash Payment...............................26

Section 28.   Successors......................................................27

Section 29.   Determinations and Actions Taken by the
              Board of Directors..............................................27

Section 30.   Benefits of this Agreement......................................27

Section 31.   Governing Law; Choice of Venue..................................27

Section 32.   Counterparts....................................................28

Section 33.   Section Headings................................................28

Section 34.   Severability....................................................28

Signature Page................................................................28

EXHIBIT A     Form of Right Certificate.......................................29

Exhibit B     Summary of Rights...............................................34

Exhibit C     Certificate of Designation for Series P Preferred Stock.........37

                                        3

<PAGE>

                                RIGHTS AGREEMENT

     This RIGHTS AGREEMENT is dated as of April 25, 2001, and is entered into by
OnLine Power Supply,  Inc., a Nevada corporation (the "Company"),  and Corporate
Stock Transfer, Inc. as the Rights Agent.

     RECITALS

     The board of directors of the Company has determined that provision  should
be made to  supplement  Nevada  law,  in a manner  consistent  with that law, to
protect  the  shareholders  by  facilitating  obtaining  a higher  value for the
Company through  negotiated  transactions,  in the event of an attempted  unfair
takeover of the Company  without the consent of the board of directors.  Subject
to the express provisions of this Rights Agreement, Exhibit C to this Agreement,
and proceedings of the board of directors of the Company, the general purpose of
this Rights Agreement is to encourage a person or company to discuss a potential
acquisition of the Company through a Qualified Offer, before acquiring more than
15% of the total voting power of the stock of the Company. Under this Agreement,
the Rights would be redeemed in the event a Qualified Offer is made.

     Therefore,   the  board  of  directors  has  authorized  and  declared  the
distribution  of one  Right  for  every  share of  Common  Stock of the  Company
outstanding  at the Close of  Business  on April 25,  2001 (the  "Rights  Record
Date"), each Right representing the right to purchase one Unit, being (initially
and before any adjustments as provided for herein) one one-thousandth  (1/1,000)
of a share of Series P Preferred  Stock.  Further,  the board of  directors  has
authorized and declared this dividend to cover every  additional share of Common
Stock which may become outstanding  between the Rights Record Date and the first
to occur of the Distribution  Date, or the Expiration Date, or the date, if any,
when the  Rights  may be  redeemed,  all  upon  the  terms  and  subject  to the
conditions stated below.

     NOW, THEREFORE, the parties agree as follows:

     AGREEMENT

         Section 1.     DEFINITIONS.

         (a) For  purposes  of this  Agreement,  the  following  terms  have the
meanings indicated:

          "ACQUIRING  PERSON"  means any Person who or which,  alone or together
with all of the  Affiliates  and  Associates of such Person,  is the  Beneficial
Owner of a Substantial Block of Voting Stock, but does not include (i) an Exempt
Person or (ii) any Person who or which  acquires a  Substantial  Block of Voting
Stock in connection with a transaction or series of transactions  approved prior
to such  transaction or  transactions  by the board of directors of the Company.
However,  no person  shall become an  Acquiring  Person  solely as a result of a
reduction in the number of shares of Voting Stock outstanding,  unless and until
such  Person  thereafter  becomes  the  Beneficial  Owner of  additional  shares
constituting 1% or more of the general voting power of the Company.

          "AFFILIATE" and "ASSOCIATE" have the respective  meanings  ascribed in
rule 12b-2 of the General Rules and Regulations under the Exchange Act.

          "BENEFICIAL  OWNER." A Person is deemed to be the Beneficial  Owner of
any securities:

                                        4

<PAGE>

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

               (ii)  which  such  Person  or any of  his  or its  Affiliates  or
Associates  has (A) the right to  acquire  (whether  such  right is  exercisable
immediately  or only  after the  passage  of time)  pursuant  to any  agreement,
arrangement or understanding  (whether or not in writing),  or upon the exercise
of any conversion, exchange or purchase rights (other than the Rights), warrants
or options, or otherwise;  provided,  however, that a Person shall not be deemed
the "Beneficial  Owner" of securities  tendered pursuant to a tender or exchange
offer made by or on behalf of such Person or any of such Person's  Affiliates or
Associates until such tendered  securities are accepted for payment or exchange;
or (B) the right to vote or to direct the voting of,  pursuant to any agreement,
arrangement or  understanding  (whether or not in writing);  or (C) the right to
dispose or to direct the disposition of, pursuant to any agreement,  arrangement
or understanding (whether or not in writing); or

               (iii) which are beneficially  owned,  directly or indirectly,  by
any other Person with which such Person or any of such  Person's  Affiliates  or
Associates has any agreement,  arrangement or  understanding  (whether or not in
writing)  for the purpose of  acquiring,  holding,  voting or  disposing  of any
securities of the Company; provided,  however, that a Person shall not be deemed
the Beneficial Owner of, or to Beneficially  Own, any security if the agreement,
arrangement  or  understanding  to vote such security (1) arises solely from the
grant of a revocable  proxy or consent given to such Person in connection with a
public proxy or consent  solicitation  made pursuant to, and in accordance with,
the applicable rules and regulations under the Exchange Act, and (2) is not also
then  reportable on Schedule  13(d) or successor  report under the Exchange Act;
provided,  further,  that a Person  engaged in  business  as an  underwriter  of
securities  shall not be deemed the  "Beneficial  Owner" of securities  acquired
through  such  person's  participation  in  good  faith  in  a  firm  commitment
underwriting until the expiration of the 40-day period immediately following the
date of such acquisition.

          "BUSINESS  DAY" means any day other than a Saturday,  Sunday or day on
which banking  institutions in the State of Colorado are authorized or obligated
by law or executive order to close.

          "CLOSE OF BUSINESS"  means 5:00 p.m.,  Denver time, on a Business Day;
provided,  however,  that if such is not a Business Day it shall mean 5:00 p.m.,
Denver time, on the next succeeding Business Day.

          "COMMON  STOCK" means the Company's  Common Stock;  and "common stock"
when used with  reference  to Persons  other  than the  Company  means:  (i) for
Persons  organized in corporate  form, the capital stock or equity security with
the greatest  voting power of such Person or, if such Person is a Subsidiary  of
another Person,  of the Person or Persons which ultimately  control such Person;
and (ii) in the case of Persons not  organized in corporate  form,  the units of
beneficial  interest which (A) represent the right to  participate  generally in
the  profits  and  losses  of such  Person  (including  without  limitation  any
flow-through tax benefits  resulting from an ownership  interest in such Person)
and (B) are entitled to exercise the greatest voting power of such Person or, in
the case of a limited  partnership,  shall have the power to remove the  general
partner or partners.

          "DISTRIBUTION DATE" has the meaning assigned in Section 3(a).

          "EQUIVALENT STOCK" has the meaning assigned in Section 7(a).

                                        5

<PAGE>

          "EXCHANGE  ACT"  means  the  Securities  Exchange  Act of 1934 and its
future amendments.

          "EXEMPT  PERSON" means the Company,  any Subsidiary of the Company and
any  employee  benefit  plan or  employee  stock  plan of the  Company or of any
Subsidiary of the Company,  or any trust or other entity organized,  established
or holding  shares of Common Stock by, for or pursuant to, the terms of any such
plan.

          "EXPIRATION DATE" has the meaning assigned in Section 7(a).

          "OFFER DATE" has the meaning assigned in Section 3(a).

          "PERSON" means any individual, firm, corporation,  partnership,  trust
or other entity and shall include any of their successors.

          "PRINCIPAL PARTY" has the meaning assigned in Section 13(b).

          "PURCHASE PRICE" means the price  (initially  $200.00) payable for one
Unit (1/1,000 share of Series P Preferred Stock) upon exercise of a Right.

          "QUALIFIED OFFER" means a tender or exchange offer for all outstanding
Common Stock at a price and on terms  determined to be adequate and otherwise in
the best interests of the Company and its stockholders (other than the Person or
an Affiliate or Associate thereof on whose behalf the offer is made) by at least
a majority of the Directors who are not  representatives  of or affiliated  with
the Person making such offer or any Affiliate or Associate of such Person.

          "REDEMPTION   PRICE"  has  the  meaning  assigned  in  Section  23(a),
initially $0.01 per Right.

          "RIGHT" has the meaning assigned in the Recitals to this Agreement.

          "RIGHTS RECORD DATE" is defined in the Recitals to this Agreement.

          "SUBJECT  SHARES" means the class or series of shares then issuable on
exercise of the Rights.

          "STOCK   ACQUISITION   DATE"  means  the  date  of  the  first  public
announcement  by the Company or an Acquiring  Person (which for purposes of this
definition shall include, without limitation, a report filed pursuant to Section
13(d) under the Exchange Act) that an Acquiring Person has become such.

          "SUBSIDIARY" means, with respect to any Person, a corporation or other
entity the  securities  or other  ownership  interests of which having  ordinary
voting power  sufficient  to elect a majority of the board of directors or other
persons  performing  similar  functions  are at the time  directly or indirectly
owned by such Person and any Affiliate of such Person.

          "SUBSTANTIAL BLOCK" means a number of shares of Voting Stock having in
the aggregate 15 percent or more of the general voting power.

          "TRADING DAY" has the meaning assigned to it in Section 11(d).

                                        6

<PAGE>

          "UNIT" means the shares or other securities  issuable upon exercise of
one Right,  initially one  one-thousandth of a share of Series P Preferred Stock
of the Company having the rights and preferences stated in Exhibit C, before any
adjustment pursuant to Section 11(a)(ii) or Section 13.

          "VOTING STOCK" means shares of the Company's capital stock the holders
of which have general voting power.

          Section 2.  APPOINTMENT OF RIGHTS AGENT.  The Company hereby  appoints
the Rights  Agent to act as agent for the Company in  accordance  with the terms
and conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such  Co-Rights  Agent or Agents as it may
deem  necessary or desirable and determine the  respective  duties of the Rights
Agent and the Co-Rights Agent or Agents.

          Section 3. DEFINITION OF DISTRIBUTION  DATE AND OFFER DATE; WHEN RIGHT
CERTIFICATES WILL ISSUE.

          (a) Until  the  Close of  Business  on the  earlier  of  (i) the tenth
Business Day after a Stock  Acquisition  Date or (ii) the tenth Business Day (or
such later date as the Company's board of directors shall  determine)  after the
date of the  commencement by any Person (other than an Exempt Person) of, or the
date of the first public announcement (such commencement date or announcement is
the "Offer Date") of the intent of any Person  (other than an Exempt  Person) to
commence a tender or exchange  offer upon the successful  consummation  of which
such  Person,  together  with  its  Affiliates  and  Associates,  would  be  the
Beneficial  Owner of 15 percent  or more of the then  outstanding  Voting  Stock
(regardless of whether any shares are actually purchased pursuant to such offer)
(the tenth Business Day after the first to occur of a Stock  Acquisition Date or
an Offer Date is the "Distribution Date"),

              (i) the Rights will automatically  attach to, and be evidenced by,
the  certificates  for Common  Stock  registered  in the names of the holders of
Common  Stock  (which  certificates  for Common Stock shall be deemed also to be
Right Certificates) and not by separate Right Certificates, and

              (ii) each Right will be  transferable  only in connection with the
transfer of the underlying shares of Common Stock.

          (b) As soon as  practicable  after the Rights Record Date, the Company
will send by first-  class mail to each record  holder of Common Stock as of the
Close of Business on the Rights Record Date a copy of the Summary of Rights (see
Exhibit B).

          For  certificates for Common Stock issued after the Rights Record Date
(including replacement certificates for shares of Common Stock outstanding on or
prior to the Rights Record Date),  but prior to the earliest of the Distribution
Date,  the  Expiration  Date and the date,  if any,  on which the  Rights may be
redeemed,  the Company  will have  printed on or  otherwise  affixed to them the
following legend:

          "This certificate also entitles the holder hereof to certain Rights as
set forth in the Rights  Agreement  between  the  Company  and  Corporate  Stock
Transfer,  Inc. as Rights  Agent as the same shall be amended  from time to time
(the "Rights  Agreement"),  the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal  executive  offices of
the Company. Under certain circumstances,  as set forth in the Rights Agreement,
such Rights will be  evidenced  by separate  certificates  and will no longer be
evidenced by this Common Stock certificate.  The Company will mail to the holder
of this

                                        7

<PAGE>

certificate  a copy of the Rights  Agreement  without  charge after receipt of a
written request  therefor.  Under certain  circumstances set forth in the Rights
Agreement,  Rights  issued  to, or held by, any Person who is, was or becomes an
Acquiring  Person or any  Affiliate  or  Associate  thereof  (as such  terms are
defined in the Rights Agreement) or certain transferees of any thereof,  whether
currently held by or on behalf of such Person or by any subsequent  holder,  may
be limited as provided in Section 7(f) of the Rights Agreement."

          For certificates  containing the legend,  until the Distribution Date,
the Rights associated with Common Stock  represented by such certificates  shall
be evidenced only by such  certificates;  transfer of any such certificates also
shall constitute transfer of the Rights associated with the Common Stock.

          (c) After the  Distribution  Date, the Rights will be evidenced solely
by the Right Certificates.

          (d) As soon as  practicable  after the  Distribution  Date, the Rights
Agent will mail by first-  class  insured  mail to each record  holder of Common
Stock as of the Close of  Business  on the  Distribution  Date,  as shown by the
records of the Company at the Close of Business on the Distribution Date, at the
address  of  such  holder  shown  on  such  records,  a  Right  Certificate,  in
substantially  the form attached  hereto as Exhibit A,  evidencing one Right for
each share of Common Stock so held.

          Section 4. FORM OF RIGHT CERTIFICATES.

          (a)  The  Right   Certificates   (and  the  forms  of  assignment  and
certification  and of election  to purchase  shares to be printed on the reverse
thereof)  shall be in  substantially  the form of  Exhibit A hereto and may have
such marks of  identification  or  designation  and such  legends,  summaries or
endorsements as are not inconsistent with this Agreement,  or as may be required
to comply with any law or to conform to usage.

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

          "The  Rights  represented  by  this  Right  Certificate  are  or  were
beneficially  owned by a Person  who was or  became  an  Acquiring  Person or an
Affiliate or Associate of an Acquiring  Person (as such terms are defined in the
Rights Agreement) or certain  transferees  thereof.  Accordingly,  under certain
circumstances as provided in the Rights  Agreement,  this Right  Certificate and
the Rights represented hereby may be limited as provided in Section 7(f) of such
Agreement.

                                        8

<PAGE>

          Section 5. COUNTERSIGNATURE AND REGISTRATION.

          (a) The Right  Certificates shall be executed on behalf of the Company
by its  Chairman  of the Board,  its  President  or any of its Vice  Presidents,
manually or by facsimile signature,  and have affixed thereto the Company's seal
or a facsimile  thereof  attested by the  Secretary or an  Assistant  Secretary,
either  manually  or by  facsimile.  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  who shall have signed any of the Right
Certificates  shall  cease to be such  officer  before  countersignature  by the
Rights Agent and issuance and delivery by the Company,  such Right Certificates,
nevertheless,  may be  countersigned  by the Rights Agent,  issued and delivered
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;  and any Right
Certificate  may be signed on behalf of the  Company by any person  who,  at the
actual  date of the  execution  of such  Right  Certificate,  shall  be a proper
officer  (as  specified  above) of the  Company to sign such Right  Certificate,
although at the date of the  execution of this Rights  Agreement any such person
was not such an officer.

          (b) Following  the  Distribution  Date,  the Rights Agent will keep or
cause to be kept books for registration  and transfer of the Right  Certificates
issued  hereunder.  Such  books  shall  show  the  names  and  addresses  of the
respective holders of the Right Certificates,  the number of Rights evidenced on
its face by each Right  Certificate,  the date of each Right Certificate and the
number 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 Sections 4(b), 7(f) and 14, at any time after the Close
of Business on the Distribution  Date, and prior to the Close of Business on the
Expiration  Date or the day prior to the day, if any,  when the Rights are to be
redeemed  under  Section  23,  any  Right  Certificate  or  Certificates  may be
transferred,  split up,  combined or exchanged for another Right  Certificate or
Right  Certificates,  entitling the registered holder to purchase such number of
Units as the Right  Certificate(s)  surrendered  then  entitled  such  holder to
purchase.  Any  registered  holder  desiring to transfer,  split up,  combine or
exchange any Right  Certificate  shall make such request in writing delivered to
the  Rights  Agent,  and  shall  surrender  the  Right   Certificate(s)   to  be
transferred, split up, combined or exchanged, with the form of assignment on the
reverse  side(s)  thereof duly  completed  and executed,  at the stock  transfer
office of the Rights Agent.  The Rights Agent shall  countersign  and deliver to
the persons entitled thereto the Right Certificate(s) requested. The Company may
require  payment of a sum sufficient to cover any tax or government  charge that
may be imposed in connection  therewith.  However,  neither the Rights Agent nor
the Company  shall be  obligated to take any action with respect to the transfer
of any such surrendered Right Certificate unless and until the registered holder
shall  have  completed  and  signed  the  certificate  contained  in the form of
assignment on the reverse side of such Right Certificate and shall have provided
such  additional  evidence of the  identity of the  Beneficial  Owner (or former
Beneficial  Owner) or  Affiliates  or  Associates  thereof as the Company  shall
reasonably request.

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

                                        9

<PAGE>

          Section 7.  EXERCISE OF RIGHTS;  PURCHASE  PRICE;  EXPIRATION  DATE OF
RIGHTS.

          (a) Subject to Section 7(f), and unless  earlier  redeemed as provided
in Section 23, the registered  holder of any Right  Certificate may exercise the
Rights evidenced  thereby in whole or in part at any time after the Distribution
Date upon  surrender  of the Right  Certificate,  with the form of  election  to
purchase on the reverse side thereof duly completed and executed,  to the Rights
Agent at the stock transfer office of the Rights Agent, together with payment of
the  Purchase  Price for each Unit as to which the Rights are  exercised,  at or
prior to the Close of Business  on the tenth  anniversary  of the Rights  Record
Date or such other date to which the Rights may be  extended as provided in this
Agreement (the latest of such dates is the  "Expiration  Date").  If at any time
after the  Distribution  Date but prior to the  Expiration  Date the  Company is
unable,  under its articles of  incorporation,  to issue the number and class of
shares required to be issued upon the exercise of all of the outstanding Rights,
the Company may issue upon exercise of any of the Rights shares of capital stock
or other securities of the Company of value equivalent to the shares so required
to be issued ("Equivalent Stock"), as determined by the board of directors.

          (b) The  Purchase  Price for each Unit  pursuant to the  exercise of a
Right initially  shall be US$200.00,  subject to adjustment from time to time as
provided in Sections 11 and 13.

          (c) Upon receipt of a Right Certificate,  with the form of election to
purchase duly  executed,  accompanied  by payment of the Purchase  Price for the
Units to be  purchased  and an amount  equal to any  applicable  transfer tax in
cash, or by certified  check,  bank draft or money order payable to the order of
the Company,  the Rights Agent shall thereupon promptly (i) requisition from the
Company or any  transfer  agent of the  Company  (if  different  from the Rights
Agent) a  certificate  for the number of shares to be purchased  and the Company
will comply,  and hereby  irrevocably  authorizes  its transfer agent to comply,
with all such requests;  (ii) requisition from the Company the amount of cash to
be  paid in lieu  of  issuance  of a  fractional  share,  when  appropriate,  in
accordance with Section 14; and (iii) promptly after receipt of such certificate
from any such  transfer  agent,  cause the same to be  delivered  to or upon the
order of the  registered  holder of such Right  Certificate,  registered  in the
name(s)  designated by such holder and cash for any fractional share. These same
procedures shall be followed if Rights are exercised for Equivalent Stock.

          (d) The Company  shall not be required to pay any  transfer  tax which
may be payable in respect of any  transfer  involved in the transfer or delivery
of Right  Certificates,  or the issuance or delivery of  certificates  in a name
other than the registered  holder,  or to issue or deliver any certificates upon
the  exercise of any  Rights,  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.

          (e) If the registered holder exercises less than all the Rights, a new
Right  Certificate for the remaining  unexercised  Rights shall be issued by the
Rights Agent to the registered  holder of such Right  Certificate or to his duly
authorized assigns, subject to Section 14.

          (f)  Notwithstanding  any provision of this Agreement to the contrary,
upon the  occurrence of any of the events  described in any of clauses (A), (B),
(C) or (D) of Section  11(a)(ii),  the adjustment under Section  11(a)(ii) shall
not apply with respect to any Rights that are at the time Beneficially  Owned by
(i) an Acquiring  Person or by any  Associate  or  Affiliate  of such  Acquiring
Person (which Acquiring Person or Affiliate or Associate engages in, or realizes
the benefit of, one or more of the  transactions  described in clause (A) or (B)
of Section  11(a)(ii),  realizes the benefits set forth in clause (C) of Section
11(a)(ii) or, alone or

                                       10

<PAGE>

together,  become the Beneficial  Owner(s) of a number of shares of Voting Stock
which equals or exceeds the  percentage of the general  voting power as provided
in clause (D) of Section 11(a)(ii), as the case may be), or (ii) a transferee of
an Acquiring  Person or of any Associate or Affiliate of such  Acquiring  Person
(which  engages in, or realizes the benefit of, one or more of the  transactions
described in clause (A) or (B) of Section 11(a)(ii), or realizes the benefits in
clause (C) of Section  11(a)(ii),  or,  alone or  together  with such  Acquiring
Person or Associate or Affiliate,  become the Beneficial Owner(s) of a number of
shares of Voting  Stock which  equals or exceeds the  percentage  of the general
voting power as provided in clause (D) of Section 11(a)(ii), as the case may be)
(A) who becomes a transferee after the Acquiring Person becomes such, or (B) who
becomes a transferee prior to or concurrently with the Acquiring Person becoming
such and  receives  such  Rights  either by (1) a transfer  (whether  or not for
consideration)  from the Acquiring Person to holders of equity interests in such
Acquiring  Person  or to any  Person  with whom such  Acquiring  Person  has any
continuing  agreement,  arrangement or  understanding  regarding the transferred
Rights,  or (2) a  transfer  which the board of  directors  of the  Company  has
determined  is part of a  plan,  arrangement  or  understanding  which  has as a
primary  purpose or effect the avoidance of this Section 7(f). Upon the exercise
of such Rights  covered by this Section  7(f),  the holders shall be entitled to
receive,  upon payment of the Purchase Price,  the number of Units issuable upon
exercise of such Rights  without  giving effect to the  adjustment  provided for
under Section 11(a)(ii).  The Company shall use all reasonable efforts to insure
that the provisions of this Section 7(f) and Section 4(b) are complied with, but
shall have no liability to any holder of Right Certificates or other Person as a
result of its making or failing to make any  determinations  with  respect to an
Acquiring Person or its Affiliates, Associates or transferees hereunder.

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

          Section 8.  CANCELLATION  AND DESTRUCTION OF RIGHT  CERTIFICATES.  All
Right Certificates surrendered for the purpose of exercise,  transfer, split up,
combi- nation or exchange  shall, if surrendered to the Company or to any of its
agents,  be delivered to the Rights Agent for  cancellation or in canceled form,
or, if surrendered  to the Rights Agent,  shall be cancelled by it, 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 so 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  cancelled   Right
Certificates  to the Company,  or shall,  at the written request of the Company,
destroy such  cancelled  Right  Certificates,  and in such case shall  deliver a
certificate of destruction thereof to the Company.

          Section 9. RESERVATION AND AVAILABILITY OF SHARES; REGISTRATION.

          (a) The Company  covenants and agrees that it shall (i) on or prior to
the Rights  Record Date,  take all such action as shall be necessary to cause to
be reserved and kept available out of its authorized and unissued capital stock,
enough shares of Preferred Stock to permit the exercise in full of all Rights to
be  outstanding  as of the  Rights  Record  Date,  (ii) no later  than  promptly
following the  Distribution  Date, take all such action as shall be necessary to
cause to be reserved and kept available out of its authorized and unissued

                                       11

<PAGE>

capital stock,  or its  authorized  and issued shares held in its treasury,  the
number of shares of Common Stock that will,  from time to time, be sufficient to
permit the exercise in full of all Rights from time to time  outstanding;  (iii)
take all such action as may be  necessary  to insure  that all shares  delivered
upon exercise of Rights shall be duly and validly  authorized  and issued and be
fully  paid and  nonassessable;  and (iv) pay when due any  transfer  taxes  and
charges in respect of the issuance or delivery of the Right  Certificates  or of
any shares upon the exercise of Rights (except as otherwise  provided in Section
7(d)).

          (b) The Company  agrees to use its best efforts as soon as practicable
following  the  Distribution  Date,  to file with the  Securities  and  Exchange
Commission a registration statement to permit the issuance of shares on exercise
of the Rights under the Securities Act of 1933, and to take the steps  necessary
to permit such issuance under the securities "blue sky" laws of the states where
registered holders reside. The Company may temporarily suspend for up to 90 days
the exercise of the Rights to file a registration  statement and other documents
as needed to allow exercise of the Rights. At the start and end of a suspension,
the Company shall issue a public  announcement  and notify the Rights Agent that
exercise has been suspended and the end of the suspension.

          (c) The Rights shall not be  exercisable  in any  jurisdiction  if not
there legal.

          (d) The Company shall use its  reasonable  efforts to cause all shares
reserved  for  issuance  upon  exercise of Rights to be listed on the  Company's
exchange or quotation market.

          Section  10.  RECORD  DATE.  Each  Person  in  whose  name  any  stock
certificate is issued upon exercise of Rights shall be deemed to have become the
holder of record of the shares  represented  thereby  on,  and such  certificate
shall be dated,  the date when the Right  Certificate  was  surrendered  and the
Purchase  Price paid.  Prior to  exercise  of the Rights,  the holder of a Right
Certificate  shall not be entitled to any rights of a stockholder of the Company
with  respect  to shares for which the Rights  shall be  exercisable,  including
without  limitation  the  right  to  vote  or  to  receive  dividends  or  other
distributions,  and such  holder  shall not be entitled to receive any notice of
any proceedings of the Company, except as provided herein.

          Section 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES OR
NUMBER OF RIGHTS (INCLUDING "FLIP-IN" PROVISION). The Purchase Price, number and
kind of shares  or other  securities  covered  by each  Right and the  number of
Rights  outstanding  are subject to adjustment  from time to time as provided in
this Section 11.

          (a) (i) If the  Company  shall  at any  time  after  the  date of this
Agreement  (A) declare and pay a dividend on the shares which are subject to the
Rights  ("Subject  Shares")  payable  in  shares  of stock of the  Company,  (B)
subdivide or split the Subject  Shares,  (C) combine or consolidate  the Subject
Shares  into a smaller  number of shares or effect a reverse  stock split of the
Subject   Shares,   or  (D)  issue  any  shares  of  its  capital   stock  in  a
reclassification  of the Subject Shares (including any such  reclassification in
connection with a consolidation or merger in which the Company is the continuing
or surviving  corporation),  then,  and in each such event,  except as otherwise
provided in this Section 11(a),  the Purchase Price in effect at the time of the
record date for dividend or  subdivision,  split,  reverse  split,  combination,
consolidation or reclassification,  and the number and kind of shares of capital
stock  issuable  on such date,  shall be  proportionately  adjusted  so that the
holder of any Right  exercised  after such time shall be entitled to receive the
aggregate  number and kind of shares of capital  stock which,  if such Right had
been  exercised  immediately  prior to such date and at a time when the transfer
books of the Company were open,  he would have  received  upon such exercise and
been  entitled to receive.  If an event occurs which would require an adjustment
under

                                       12

<PAGE>

both this Section 11(a)(i) and Section 11(a)(ii), 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).

              (ii) If at any time after the date of this Agreement

                  (A) any Acquiring Person, or any Associate or Affiliate of any
Acquiring Person, directly or indirectly (1) shall merge into the Company or any
of  its  Subsidiaries  or  otherwise  combine  with  the  Company  or any of its
Subsidiaries  and the  Company or such  Subsidiary  shall be the  continuing  or
surviving  corporation of such merger or combination  and the Common Stock shall
remain  outstanding and the outstanding shares thereof shall not be changed into
or exchanged for stock or other securities of the Company or of any other Person
or cash or any other property, or (2) shall sell or otherwise transfer in one or
more transactions,  assets to the Company or any of its Subsidiaries in exchange
for 15  percent  or more of the  shares  of any  class of  capital  stock of the
Company  or  any  of  its  Subsidiaries,  and  the  Common  Stock  shall  remain
outstanding and unchanged, or

                  (B)  directly or  indirectly,  any  Acquiring  Person,  or any
Associate  or  Affiliate  of any  Acquiring  Person,  shall  (1) in one or  more
transactions,  transfer  assets to the  Company  or any of its  Subsidiaries  in
exchange  (in whole or in part) for shares of any class of capital  stock of the
Company  or  any of  its  Subsidiaries  or  for  securities  exercisable  for or
convertible  into shares of any class of capital  stock of the Company or any of
its   Subsidiaries  or  otherwise   obtain  from  the  Company  or  any  of  its
Subsidiaries, with or without consideration,  any additional shares of any class
of capital stock of the Company or any of its  Subsidiaries or other  securities
exercisable for or convertible  into shares of any class of capital stock of the
Company  or  any  of  its  Subsidiaries  (other  than  as  part  of a  pro  rata
distribution  by the Company or such Subsidiary to all holders of Common Stock),
or (2) sell, purchase, lease, exchange,  mortgage, pledge, transfer or otherwise
dispose (in one or more transactions), to, from or with, as the case may be, the
Company  or any  of its  Subsidiaries,  assets  on  terms  and  conditions  less
favorable to the Company or such  Subsidiary than the Company or such Subsidiary
would be able to obtain in arm's-length  negotiation with an unaffiliated  third
party, or (3) receive any compensation  from the Company or any of the Company's
Subsidiaries  other than  compensation  for  full-time  employment  as a regular
employee,  or fees for  serving as  director,  at rates in  accordance  with the
Company's (or its  Subsidiaries')  past  practices,  or (4) receive the benefit,
directly or indirectly (except proportionately as a stockholder),  of any loans,
advances,  guarantees,  pledges or other  financial  assistance  provided by the
Company or any of its  Subsidiaries,  on terms and conditions  less favorable to
the Company or such Subsidiary than the Company or such Subsidiary would be able
to obtain in arm's-length negotiation with an unaffiliated third party, or

                  (C)  during  any such  time as there is an  Acquiring  Person,
there shall be any  reclassification of securities  (including any reverse stock
split), or  recapitalization  of the Company,  or any merger or consolidation of
the Company with any of its  Subsidiaries  or any other similar  transaction  or
series of transactions involving the Company or any of its Subsidiaries (whether
or not with or into or otherwise  involving an Acquiring Person or any Affiliate
or  Associate  of such  Acquiring  Person)  which has the  effect,  directly  or
indirectly,  of increasing by more than one percent the  proportionate  share of
the  outstanding  shares  of any class of equity  securities,  or of  securities
exercisable for or convertible into equity securities,  of the Company or any of
its  Subsidiaries  which is directly or indirectly owned by any Acquiring Person
or any Associate or Affiliate of any Acquiring Person, or

                  (D) any Person shall become an Acquiring Person otherwise than
pursuant  to a  Qualified  Offer,  then,  and in each such case,  but subject to
Section 27  (covering  exchange  of Rights for shares of Common  Stock,  without
requiring exercise of Rights), proper provision shall be made

                                       13

<PAGE>

so that each holder of a Right  (except as provided  below and in Section  7(f))
shall,  on and  after the  later of (I) the date of the  occurrence  of an event
described in clause (A), (B), (C) or (D) of this Section 11(a)(ii),  or (II) the
expiration of the period  within which the Rights may be redeemed  under Section
23 (as the same may have  been  amended  under  Section  26),  have the right to
receive, upon exercise thereof at the then current Purchase Price, the number of
shares of Common Stock equal to the result  obtained by (x) multiplying the then
current  Purchase  Price by the then  number  of Units for which a Right is then
exercisable  and dividing  that product by (y) 50 percent of the current  market
price per share of Common Stock (determined in accordance with Section 11(d)) on
the date of the  occurrence  of the  relevant  event listed above in clause (A),
(B),  (C) or (D) of  this  subparagraph  (ii);  PROVIDED,  HOWEVER,  that if the
transaction  that would otherwise give rise to the foregoing  adjustment is also
subject to the  provisions of Section 13, then only the provisions of Section 13
("flip-over" provisions) shall apply and no adjustment shall be made pursuant to
this  Section  11(a)(ii).  The Company  shall not  consummate  any such  merger,
combination, transfer or transaction referred to in any of such clauses (A), (B)
and (C) unless prior thereto there shall be sufficient  authorized  but unissued
Common Stock to permit the exercise in full of the Rights in accordance with the
foregoing  sentence,  unless  the Board of  Directors  has  determined  to issue
Equivalent Stock in accordance with Section 7(a); PROVIDED,  HOWEVER, that in no
case may the  Company  consummate  any such  merger,  combination,  transfer  or
transaction if at the time of or immediately  after such  transaction  there are
any  rights,   warrants  or  other  instruments  or  securities  outstanding  or
agreements in effect which would  substantially  diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.

     If the  Company  issues  Equivalent  Stock upon the  exercise of any Rights
pursuant to the immediately  preceding paragraph,  then, upon any such exercise,
proper provision shall be made so that the holder of a Right (except as provided
in Section 7(f)) shall have the right to receive, upon such exercise at the then
current Purchase Price, such number of shares or other units of Equivalent Stock
of the Company as shall equal the result  obtained by (x)  multiplying  the then
current  Purchase  Price  by the  number  of  Units  for  which a Right  is then
exercisable  and dividing  that product by (y) 50 percent of the current  market
price per share or other unit of the Equivalent Stock of the Company (determined
on  substantially  the same basis as is prescribed by Section 11(d) with respect
to the  valuation  of Common  Stock) on the date of  occurrence  of the relevant
event listed above in clause (A), (B), (C) or (D) of this subparagraph  (ii). If
at any time the Company  should be  prohibited  by law, by any  provision of its
articles  of  incorporation,  or by any  instrument  or  agreement  to which the
Company is a party or by which it is bound,  from  issuing,  or should be unable
under its articles of  incorporation  to issue,  sufficient  Equivalent Stock to
permit the exercise of all  outstanding  Rights in accordance with the foregoing
sentence, then, in lieu of issuing such Equivalent Stock upon such exercise, the
Company shall pay to each holder of a Right (except as provided in Section 7(f))
upon  surrender  of the Right as  provided  herein  but  without  payment of the
Purchase Price, an amount in cash for each Right equal to the Purchase Price.

          (b) If after the Rights Record Date the Company sets a record date for
the  issuance of rights or  warrants  to all holders of Common  Stock or Subject
Shares  entitling them (for a period expiring within 45 calendar days after such
record date) to  subscribe  for or purchase  Common  Stock or Subject  Shares or
securities  convertible into Common Stock or Subject Shares at a price per share
(or having a conversion  price per share, if a security  convertible into Common
Stock) less than the current  market  price per share  (determined  with Section
11(d)) on such record date, the Purchase Price to be in effect after such record
date shall be determined by multiplying the Purchase Price in effect immediately
prior to such record date by a fraction; the numerator shall be the total number
of shares of Common  Stock and Subject  Shares  outstanding  on such record date
plus the number of shares of Common Stock which the aggregate  offering price of
the total  number  of shares so to be  offered  (and/or  the  aggregate  initial
conversion price of the convertible  securities so to be offered) would purchase
at such current market price, and the denominator shall be the total

                                       14

<PAGE>

number of shares of Common Stock and Subject  Shares  outstanding on such record
date plus the number of  additional  shares to be offered  for  subscription  or
purchase (or into which the  convertible  securities to be offered are initially
convertible).  In case such subscription or purchase price may be paid, in whole
or in part, in a form other than cash, the value of such consideration  shall be
as  determined  in good faith by the board of directors  of the  Company,  whose
determination  shall be  described in a statement  filed with the Rights  Agent.
Shares  owned by or held for the  account  of the  Company  shall  not be deemed
outstanding for the purpose of any such  computation.  Such adjustment  shall be
made  successively  whenever such a record date is fixed,  and if such rights or
warrants  are not so issued,  the  Purchase  Price  shall be  adjusted to be the
Purchase  Price  which  would then be in effect if such record date had not been
set.

          (c) If the  Company at any time after the  Rights  Record  Date sets a
record date for making a  distribution  on shares of Common Stock or the Subject
Shares, whether by way of a dividend,  distribution,  reclassification of stock,
recapitalization,  reorganization  or  partial  liquidation  of the  Company  or
otherwise  (and  including  any  such  distribution  made in  connection  with a
consolidation or merger in which the Company is the continuing corporation),  of
subscription  rights or warrants (excluding those referred to in Section 11(b)),
evidences of indebtedness or other assets (other than (i) regular  periodic cash
dividends, (ii) a dividend payable in Common Stock or (iii) a distribution which
is  part of or is  made  in  connection  with a  transaction  to  which  Section
11(a)(ii) or Section 13 applies),  then the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in effect
immediately  prior to such  record date by a  fraction,  of which the  numerator
shall be the current  market  price per share of Common Stock  (determined  with
Section 11(d)) on such record date, less the fair market value applicable to one
share of Common Stock (as  determined in good faith by the board of directors of
the Company,  whose  determination  shall be described in a statement filed with
the  Rights  Agent)  of such  assets or  evidences  of  indebtedness  or of such
subscription  rights  or  warrants  so to  be  distributed,  and  of  which  the
denominator  shall be such current market price per share of Common Stock.  Such
adjustments shall be made successively whenever such a record date is fixed; and
if such  distribution is not so made, the Purchase Price shall again be adjusted
to be the  Purchase  Price which would then be in effect if such record date had
not been fixed.

          (d) The "current  market  price" per share of Common Stock on any date
shall be deemed to be the average of the daily closing  prices per share of such
Common Stock for the 30  consecutive  Trading Days (defined  below)  immediately
prior to such date;  provided,  however,  that if the current  market  price per
share of Common Stock is determined  during a period  following the announcement
by the issuer of such Common Stock of a dividend or  distribution on such Common
Stock  payable in shares of such Common  Stock or  securities  convertible  into
shares of Common Stock (other than the Rights),  and prior to the  expiration of
30 Trading Days after the  ex-dividend  date for such dividend or  distribution,
then,  and in each such case,  the current  market price shall be  appropriately
adjusted  to  reflect  the  current  market  price per share of Common  Stock in
connection with ex-dividend trading. The closing price for each day shall be the
last sale price,  or, in case no such sale takes place on such day,  the average
of the closing bid and asked prices, in either case as reported in the principal
consolidated  transaction  reporting  system of the  principal  market where the
shares of Common  Stock are  listed or  admitted  to  trading.  If the shares of
Common  Stock are not listed or admitted to trading on any  national  securities
exchange, then closing price will be determined with reference to the average of
the high bid and low asked prices in the over-the-counter market, as reported by
the National Association of Securities Dealers, Inc., Automated Quotation System
("NASDAQ"). If on any such date the shares of Common Stock are not quoted by any
such  organization,  the  fair  market  value  of such  shares  on such  date as
determined  in good  faith by the  board of  directors  shall be used.  Any such
determination  of current  market price shall be described in a statement  filed
with the Rights Agent.

                                       15

<PAGE>

          For the purpose of any  computation  hereunder,  the  "current  market
price" of a Unit  shall be deemed to be equal to the  current  market  price per
share of Common Stock,  and the "current  market price" of a Subject Share shall
be  deemed to be equal to the  current  market  price per share of Common  Stock
divided by the number of Subject Shares which comprise a Unit.

          For purposes of this  Agreement,  the term  "Trading Day" shall mean a
day on which the principal national  securities  exchange on which the shares of
Common  Stock are listed or admitted to trading is open for the  transaction  of
business or, if the shares of Common Stock are not listed or admitted to trading
on any national securities exchange, a Business Day.

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

          (f) If at any time,  as a result of an  adjustment  made  pursuant  to
Section  11(a),  the  holder  of any Right  thereafter  exercised  shall  become
entitled to receive any shares of capital stock of the Company other than shares
of Common Stock,  thereafter the number of such other shares so receivable  upon
exercise  of any Right  shall be  subject to  adjustment  from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions,  with
respect to such shares,  contained in Sections 11(a) through (c), inclusive. The
provisions  of Sections 7, 9, 10, 13 and 14 with respect to the shares of Common
Stock shall apply on like terms to any such other shares.

          (g) All Rights  originally  issued by the  Company  subsequent  to any
adjustment  made to the Purchase Price  hereunder  shall  represent the right to
purchase,  at the adjusted Purchase Price, the number of shares 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 under Section
11(i),  when there is an  adjustment  of the  Purchase  Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding  immediately
prior to the making of such adjustment  shall  thereafter  evidence the right to
purchase,  at the adjusted Purchase Price, that number of shares  (calculated to
the nearest one-thousandth) obtained by (i) multiplying (x) the number of shares
covered by a Right  immediately  prior to such  adjustment  by (y) the  Purchase
Price in effect  immediately prior to such adjustment of the Purchase Price, and
(ii) dividing the result by the Purchase Price in effect  immediately after such
adjustment.

               (i) The Company may elect,  on or after the date of adjustment of
the Purchase  Price,  to adjust the number of Rights,  in  substitution  for any
adjustment in the number of shares  purchasable upon the exercise of each Right.
Each of the Rights  outstanding  after such  adjustment  of the number of Rights
shall be exercisable  for the number of Units 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-thousandth)  obtained by dividing  the Purchase
Price in effect  immediately  prior to adjustment  of the Purchase  Price by the
Purchase Price in effect immediately after adjustment of the Purchase Price. The
Company shall make a public announcement of its election to adjust

                                       16

<PAGE>

the number of Rights,  indicating  the record date for the  adjustment,  and, if
known at the time, the amount of the adjustment to be made. This record date may
be the date on which the Purchase Price is adjusted or any day thereafter,  but,
if the Right Certificates have been issued, shall be at least 10 days later than
the date of the public  announcement.  If Right  Certificates  have been issued,
upon each  adjustment  of the number of Rights  the  Company  shall  cause to be
distributed  to holders of record of Right  Certificates  on such  record  date,
Right  Certificates  to show  (subject to Section 14) the  additional  Rights to
which the holders shall be entitled as a result of such adjustment.  However, at
its option,  the Company may shall cause to be distributed in  substitution  and
replacement for the Right  Certificates held by the holders prior to the date of
adjustment,  and upon surrender thereof,  if required by the Company,  new Right
Certificates  to evidence all the Rights to which the holders are entitled after
the adjustment.

          (j)  Irrespective of any adjustment or change in the Purchase Price or
the  number  of shares  issuable  upon the  exercise  of the  Rights,  the Right
Certificates  theretofore  and  thereafter  issued may  continue  to express the
Purchase  Price per share and the number of shares  which were  expressed in the
initial Right Certificates issued hereunder.

          (k) If this  Section 11 requires  that an  adjustment  in the Purchase
Price be made effective as of the 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  the  additional  shares  or
securities of the Company, if any, issuable as a consequence of such adjustment;
provided,  however,  that the Company shall deliver to such holder a due bill or
other  appropriate  instrument  evidencing  such holder's  right to receive such
additional shares or securities upon the occurrence of such event.

          (l)  Notwithstanding  the other  provisions  of this  Section  11, the
Company shall be entitled to make such adjustments in the number of shares which
may be  acquired  upon  exercise  of the  Rights,  and such  adjustments  in the
Purchase Price, in addition to those adjustments expressly required by the other
subsections  of this Section 11, as and to the extent that the  Company,  in its
sole discretion,  shall determine to be advisable, in order that (x) the holders
of the Rights shall be treated  equitably and in accordance with the purpose and
intent of this Agreement,  and (y) to the extent reasonably possible, such event
shall not, in the opinion of counsel for the Company, result in the stockholders
of the Company being subject to any United States  federal  income tax liability
by such  adjustments.  The events  which  would  enable the Company to make such
further   adjustments  include  (i)  any   reclassification,   consolidation  or
subdivision of the Common Stock; (ii) any reorganization or partial  liquidation
of the Company or similar transaction; (iii) any issuance wholly for cash of any
Common Stock at less than the current market price; (iv) any issuance wholly for
cash of Common Stock or securities  which by their terms are convertible into or
exchangeable for Common Stock; (v) any stock dividends;  or (vi) any issuance of
rights, options or warrants to holders of Common Stock.

          Section  12.  CERTIFICATION  OF ADJUSTED  PURCHASE  PRICE OR NUMBER OF
SHARES.  If an  adjustment is made under Section 11 or 13, the Company shall (i)
promptly  prepare a  certificate  setting  forth  such  adjustment,  and a brief
statement of the facts accounting for such  adjustment;  (ii) promptly file with
the Rights Agent and any different transfer agent for the Common Stock a copy of
such  certificate;  and (iii)  mail a brief  summary  to each  holder of a Right
Certificate  in  accordance  with  Section  25.  Notwithstanding  the  foregoing
sentence,  the failure of the  Company to give such notice  shall not affect the
validity of, or the force or effect of, the requirement for such adjustment.

                                       17

<PAGE>

          Section  13.  CONSOLIDATION,  MERGER OR SALE OR  TRANSFER OF ASSETS OR
EARNING POWER (INCLUDING "FLIP-OVER PROVISION).

          (a) If, at any time after an Acquiring Person has become such,

              (i) the Company  shall  consolidate  with, or merge with and into,
any other  Person  and the  Company  shall not be the  continuing  or  surviving
corporation of such consolidation or merger,

              (ii) any other Person(s) shall  consolidate or merge with and into
the Company,  the Company shall be the  continuing or surviving  corporation  of
such merger, and in connection with such consolidation or merger, all or part of
the  Common  Stock  shall  be  changed  into or  exchanged  for  stock  or other
securities of the Company or of any other Person or cash or any other  property,
or

              (iii) the Company shall sell or otherwise transfer (or one or more
of  its  Subsidiaries  shall  sell  or  otherwise  transfer),  in  one  or  more
transactions,  assets or earning power  aggregating  more than 50 percent of the
assets or earning power of the Company and its  Subsidiaries  (taken as a whole)
to any other  Person,  (other  than a pro rata  distribution  by the  Company of
assets  (including  securities) of the Company or any of its Subsidiaries to all
holders of the Company's Common Stock),  then, on and after the later of (I) the
date of the  occurrence  of an event  described in clause (i),  (ii) or (iii) of
this Section  13(a),  or (II) the date of the  expiration  of the period  within
which the Rights may be  redeemed  pursuant  to Section 23 (as the same may have
been amended as provided in Section 26):

                    (A) proper  provision shall be made so that each holder of a
Right shall  thereafter have the right to receive,  upon the exercise thereof at
the then current  Purchase  Price,  such number of shares of common stock of the
Principal  Party as shall be equal to the result obtained by (x) multiplying the
then  current  Purchase  Price by the  number of Units for which a Right is then
exercisable  and dividing  that product by (y) 50 percent of the current  market
price per share of the common stock of the Principal  Party  (determined  in the
same manner as the current  market  price of Common  Stock is  determined  under
Section 11(d)) on the date of consummation of such  consolidation,  merger, sale
or transfer;

                    (B) the Principal Party shall  thereafter be liable for, and
shall assume, by virtue of such consolidation, merger, sale or transfer, all the
obligations and duties of the Company pursuant to this Agreement,  provided that
the Principal Party shall,  prior to the first  occurrence of an event described
in clause (i), (ii) or (iii) of this Section  13(a),  have caused to be reserved
out of its authorized and unissued shares of common stock (or its authorized and
issued shares of common stock held in its  treasury),  for issuance  pursuant to
this Agreement,  the number of shares of common stock that will be sufficient to
permit the exercise in full of the Rights after the occurrence of such event;

                    (C) the term "Company" wherever used in this Agreement shall
thereafter be deemed to refer to such Principal Party; and

                    (D)  the   Principal   Party  shall,   in  addition  to  the
reservation  of shares of its common  stock as provided in the proviso to clause
(B) above,  take such steps (including  without  limitation  compliance with the
Company's  other  obligations as set forth in Section 9) in connection with such
consummation  as may be  necessary  to assure that the  provisions  hereof shall
thereafter be  applicable,  as nearly as  reasonably  may be, in relation to the
shares of its common  stock  thereafter  deliverable  upon the  exercise  of the
Rights;  provided,  however, that, upon the subsequent occurrence of any merger,
consolidation,  sale  of  all or  substantially  all  assets,  recapitalization,
reclassification of shares, reorganization or other extraordinary

                                       18

<PAGE>

transaction  in respect of such  Principal  Party,  each holder of a Right shall
thereupon  be entitled to receive,  upon  exercise of a Right and payment of the
Purchase Price,  such cash,  shares,  rights,  warrants and other property which
such holder would have been entitled to receive had such holder,  at the time of
such  transaction,  owned  the  shares of common  stock of the  Principal  Party
purchasable  upon the exercise of a Right,  and such Principal  Party shall take
such steps  (including,  but not limited to,  reservation of shares of stock) as
may be necessary to permit the  subsequent  exercise of the Rights in accordance
with the  terms  hereof  for such  cash,  shares,  rights,  warrants  and  other
property.

          (b) For purposes of this Agreement, "Principal Party" shall mean

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

              (ii) in the case of any  transaction  described in clause (iii) of
Section 13(a),  the Person that is the party  receiving the greatest  portion of
the  assets  or  earning  power  transferred  pursuant  to such  transaction  or
transactions,  or,  if  each  Person  that is a party  to  such  transaction  or
transactions  receives  the same  portion  of the  assets  or  earning  power so
transferred  or if the Person  receiving  the greatest  portion of the assets or
earning power cannot be  determined,  whichever of such Persons is the issuer of
common stock having the greatest market value of shares  outstanding;  PROVIDED,
HOWEVER, that in any such case, (1) if the common stock of such Person is not at
such time and has not been  continuously  over the  preceding  12- month  period
registered  under Section 12 of the Exchange Act, and such Person is a direct or
indirect  Subsidiary of another corporation the common stock of which is and has
been so registered, "Principal Party" shall refer to such other corporation; (2)
if the common  stock of such  Person is not and has not been so  registered  and
such Person is not a direct or indirect  Subsidiary of another  corporation  the
common  stock of which is and has been so  registered,  "Principal  Party" shall
refer to the corporation which ultimately controls such Person; (3) in case such
Person is a Subsidiary,  directly or indirectly,  of more than one  corporation,
the common  stocks of all of which are and have been so  registered,  "Principal
Party"  shall refer to whichever  of such  corporations  is the issuer of common
stock having the greatest market value of shares held by the public;  and (4) if
the common stock of such Person is not and has not been so  registered  and such
Person is owned,  directly or  indirectly,  by a joint venture  formed by two or
more Persons that are not owned, directly or indirectly, by the same Person, the
rules set forth in clauses  (1),  (2) and (3) above  shall  apply to each of the
chains of ownership  having an interest in such joint  venture as if such Person
were a  "Subsidiary"  of both or all of such joint  venturers  and the Principal
Party in each such chain shall bear the obligations set forth in this Section 13
in the same ratio as its direct or indirect interests in such Person bear to the
total of such interests.

          (c) The Company shall not consummate any such  consolidation,  merger,
sale or transfer  unless prior thereto the Company and the Principal Party shall
have executed and delivered to the Rights Agent a supplemental  agreement making
valid  provision  for the results  described in clause (A) of Section  13(a) and
confirming  that the  Principal  Party will perform its  obligations  under this
Section 13(a); provided, however, that in no case may the Company consummate any
such  consolidation,  merger,  sale  or  transfer  if  (i)  at  the  time  of or
immediately  after such  transaction  there are any  rights,  warrants  or other
instruments  or  securities  outstanding  or  agreements  in effect  which would
substantially diminish or otherwise eliminate the benefits

                                       19

<PAGE>

intended to be afforded by the Rights or (ii) prior to,  simultaneously  with or
immediately  after  such  transaction,  the  stockholders  of the  Person  which
constitutes,  or would  constitute,  the  Principal  Party for  purposes of this
Section 13 shall have received a distribution of Rights previously owned by such
Person or any of its Affiliates and Associates.

          (d) The  provisions  of this  Section  13  shall  similarly  apply  to
successive  mergers or consolidations or sales or other transfers.  This Section
13 shall not be applicable to a transaction described in Subparagraphs (i), (ii)
or  (iii)  of  Subsection  (a) of  this  Section  if  (i)  such  transaction  is
consummated  with a Person or Persons who acquired  Common  Stock  pursuant to a
Qualified  Offer (or a wholly owned  subsidiary  of any such Person or Persons);
(ii) the  price  per  share of  Common  Stock  offered  in such  transaction  or
distributable  to stockholders  upon conclusion of such  transaction is not less
than the price per share of Common  Stock paid to all  holders  of Common  Stock
whose shares were purchased pursuant to such Qualified Offer; and (iii) the form
of consideration being offered to the remaining holders of Common Stock pursuant
to such  transaction or  distributable  to stockholders  upon conclusion of such
transaction  is the  same as the form of  consideration  paid  pursuant  to such
Qualified Offer.  Upon conclusion of any transaction  described in the foregoing
sentence, all Rights shall expire.

          Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.

          (a) The Company shall not be required to issue  fractions of Rights or
distribute Right Certificates  which evidence  fractional Rights. If the Company
shall  elect not to issue such  fractional  Rights,  in lieu of such  fractional
Rights,  there shall be paid to the registered holders of the Right Certificates
with regard to which such Fractional  Rights would  otherwise be issuable,  cash
equal to the same fraction of the current market value of a whole Right. For the
purposes of this Section 14(a),  the current market value of a whole Right shall
be the closing price of the Rights for the Trading Day immediately  prior to the
date on which such  fractional  Rights would have been otherwise  issuable.  The
closing price for any day shall be the last sale price, regular way, or, in case
no such sale takes  place on such day,  the average of the closing bid and asked
prices,  regular way, in either case as reported in the  principal  consolidated
transaction  reporting  system with respect to securities  listed or admitted to
trading  on the New York  Stock  Exchange  or, if the  Rights  are not listed or
admitted to trading on the New York Stock Exchange, as reported in the principal
consolidated  transaction  reporting system with respect to securities listed on
the  principal  national  securities  exchange on which the Rights are listed or
admitted  to trading  or, if the Rights are not listed or admitted to trading on
any  national  securities  exchange,  the  average of the high bid and low asked
prices in the  over-the-counter  market,  as reported by NASDAQ.  If on any such
date the Rights are not quoted by any such  organization,  the fair value of the
Rights on such date as determined in good faith by the board of directors of the
Company shall be used. Any such  determination  of current market value shall be
described in a statement filed with the Rights Agent.

          (b) The Company  shall not be required  to issue  fractions  of shares
upon exercise of a Right or to distribute certificates which evidence fractional
shares.  In lieu of fractional  shares,  the Company shall pay to the registered
holders of Right Certificates at the time such Right Certificates are exercised,
cash equal to the same fraction of the current market value of a share of Common
Stock.  For purposes of this Section 14, the current  market value of a share of
Common  Stock  shall be the  closing  price of a share of  Common  Stock for the
Trading Day immediately prior to the date of such exercise.

          (c) The holder of a Right by the acceptance  thereof  expressly waives
his right to  receive  any  fractional  Rights  or any  fractional  shares  upon
exercise of a Right.

                                       20

<PAGE>

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

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

          (b) on and after the Distribution Date, the Right Certificates will be
transferable  only  on the  registry  books  of the  Rights  Agent  and  then if
surrendered at the stock transfer  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  (or,  prior to the  Distribution  Date,  the
associated Common Stock certificate) is registered as the absolute owner thereof
and of the Rights evidenced thereby  (notwithstanding any notations of ownership
or writing on the Right  Certificates or the associated Common Stock certificate
made by anyone  other than the  Company or the  Rights  Agent) for all  purposes
whatsoever.  Neither the  Company nor the Rights  Agent shall be affected by any
notice to the contrary.

          Section 17.  RIGHT  CERTIFICATE  HOLDER NOT DEEMED A  STOCKHOLDER.  No
holder,  as such, of any Right  Certificate  shall be entitled to vote,  receive
dividends  or be deemed for any purpose the holder of Common  Stock or any other
securities  of the Company  which may at any time be issuable on the exercise of
the Rights represented  thereby.  No provision of this Agreement or of any Right
Certificate  shall  be  construed  to  confer  upon  the  holder  of  any  Right
Certificate,  as such,  any of the rights of a stockholder of the Company or any
right to vote for the  election of  directors  or upon any matter  submitted  to
stockholders  at any  meeting  thereof,  or to give or  withhold  consent to any
corporate  action,  or to receive notice of meetings or other actions  affecting
stockholders  (except as provided in Section  24),  or to receive  dividends  or
subscription  rights,  or  otherwise,  until the Rights  evidenced by such Right
Certificate have been exercised.

          Section 18. CONCERNING THE RIGHTS AGENT.

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

                                       21

<PAGE>

the Rights  Agent for,  and hold it  harmless  against any loss,  liability,  or
expense incurred,  without  negligence,  bad faith or willful  misconduct on the
part of the Rights  Agent,  for anything  done or omitted by the Rights Agent in
connection with the acceptance and  administration of this Agreement,  including
the costs and expenses of defending against any claim of liability.

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

          Section 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.

          (a) Any  corporation  into  which the  Rights  Agent or any  successor
Rights  Agent  may be  merged  or  with  which  it may be  consolidated,  or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation succeeding to
the stock transfer  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. In case at the
time such  successor  Rights Agent shall  succeed to the agency  created by this
Agreement any of the Right  Certificates  shall have been  countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the
predecessor  Rights Agent and deliver such Right  Certificates so countersigned.
In  case at  that  time  any of the  Right  Certificates  shall  not  have  been
countersigned,   any  successor   Rights  Agent  may   countersign   such  Right
Certificates  either in the name of the predecessor  Rights Agent or in the name
of the  successor  Rights  Agent and in all such cases  such Right  Certificates
shall  have  the full  force  provided  in the  Right  Certificates  and in this
Agreement.

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

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

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

          (b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it  necessary  or  desirable  that any fact or matter be
proved or  established  by the Company  prior to taking or suffering  any action
hereunder,  such fact or matter  (unless  other  evidence in respect  thereof be
herein  specifically  prescribed)  may be deemed to be  conclusively  proved and
established by a certificate signed by

                                       22

<PAGE>

the Chairman of the Board, the President,  any Vice President,  or the Secretary
of the Company and delivered to the Rights Agent, and such certificate  shall be
full  authorization to the Rights Agent for any action taken or suffered in good
faith by it under  the  provisions  of this  Agreement  in  reliance  upon  such
certificate.

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

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

          (e) The Rights Agent shall not be under any  responsibility in respect
of the validity of this  Agreement or the execution and delivery  hereof (except
the due  execution  hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its  countersignature  thereof),  nor
shall it be  responsible  for any  breach  by the  Company  of any  covenant  or
condition contained in this Agreement or in any Right Certificate,  nor shall it
be responsible for any adjustment required under the provisions of Section 11 or
13 or responsible for the manner, method or amount of any such adjustment or the
ascertaining  of the existence of facts that would  require any such  adjustment
(except with respect to the exercise of Rights  evidenced by Right  Certificates
after actual notice of any such  adjustment),  nor shall it by any act hereunder
be deemed to make any  representation  or  warranty as to the  authorization  or
reservation  of any shares of stock to be issued  pursuant to this  Agreement or
any Right Certificate or as to whether any shares of stock 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  performance  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 the
Chairman of the Board,  the  President or the  Secretary of the Company,  and to
apply to such officers for advice or instructions in connection with its duties,
and it shall not be liable for any action taken or suffered to be taken by it in
good faith in accordance with instructions of any such officer.

          (h) Nothing  herein shall preclude the Rights Agent from acting in any
other capacity for the Company or for any other legal entity.

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

          (j) If,  with  respect  to any Right  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 either not
been  completed  or  indicates  an  affirmative  response  to  clause 1 and/or 2
thereof, the Rights

                                       23

<PAGE>

Agent shall not take any further action with respect to such requested  exercise
or transfer without first obtaining the Company's approval.

          Section 21. CHANGE OF RIGHTS AGENT.  Unless the Company and the Rights
Agent agree to a shorter time period,  the Rights Agent or any successor  Rights
Agent may resign and be discharged  from its duties under this Agreement upon 15
days'  notice in writing  mailed to the  Company  (and,  if  different,  to each
transfer  agent of Common  Stock) by registered  or certified  mail,  and to the
holders of the Right  Certificates by first-class  mail.  Unless the Company and
the Rights  Agent  agree to a shorter  time  period,  the Company may remove the
Rights  Agent or any  successor  Rights  Agent upon 15 days'  notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to
each transfer agent of Common Stock 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,  the Company
shall appoint a successor to the Rights Agent. If the Company shall fail to make
such  appointment  within a period of 15 days after such removal or after it has
been notified in writing of such  resignation  or incapacity by the resigning or
incapacitated  Rights Agent or by the holder of a Right  Certificate (who shall,
with such notice,  submit his Right  Certificate for inspection by the Company),
then 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  and doing  business  under the laws of the United States
having a stock  transfer  office in the State of  Colorado  which is  subject to
supervision  or  examination  by  federal  authority.  After  appointment,   the
successor Rights Agent shall be vested with the same powers,  rights, duties and
responsibilities  as if it had been  originally  named as Rights  Agent  without
further act or deed, but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose.  Not later than the  effective  date of any such  appointment,  the
Company shall file notice thereof in writing with the  predecessor  Rights Agent
(and if  different,  each  transfer  agent of  Common  Stock)  and mail a notice
thereof in writing to the registered holders of the Right Certificates.  Failure
to give any notice  provided  for in this  Section  21,  however,  or any defect
therein, shall not affect the legality or validity of the resignation or removal
of the Rights Agent or the  appointment  of the successor  Rights Agent,  as the
case may be.

          Section 22. ISSUANCE OF NEW RIGHT CERTIFICATES. Notwithstanding any of
the provisions of this  Agreement or of the Rights to the contrary,  the Company
may, at its option, issue new Right Certificates  evidencing Rights in such form
as may be approved by its board of directors to reflect any adjustment or change
in the  Expiration  Date,  the Purchase Price per share or the number or kind or
class of shares of stock or other securities or property  purchasable  under the
Right Certificates made in accordance with the provisions of this Agreement.

          Section 23. REDEMPTION.

          (a) At its  complete  option  and as  provided  below,  the  board  of
directors of the Company may, in the event of the triggers set forth in Sections
11 and 13, and  notwithstanding  the  operative  provisions  of those  Sections,
instead elect to redeem all but not less than all of the then outstanding Rights
at a redemption price of $.01 per Right,  appropriately  adjusted to reflect any
stock split, stock dividend,  reclassification or similar transaction  occurring
after the date  hereof,  at any time up to (but not after) the Close of Business
on a Stock Acquisition Date.  PROVIDED,  HOWEVER,  that redemption of the Rights
only may be made in conjunction with the board of directors'  determination that
a tender or exchange offer is a Qualified  Offer,  and provided  further that in
its discretion, the board of directors may provide that the Rights

                                       24

<PAGE>

shall be reinstated and the redemption  price refunded if the Qualified Offer is
materially  and  adversely  changed  to the  detriment  of the  Company  and its
shareholders,  as  determined  by the  board  of  directors  in  its  reasonable
discretion.

          (b) Immediately upon the action of the board of directors  electing to
redeem the Rights,  the Company shall make a public  announcement  thereof,  and
from and after the date of such  announcement,  without any  further  action and
without any further notice,  the right to exercise the Rights will terminate and
the only  right  thereafter  of the  holders of Rights  shall be to receive  the
Redemption Price. As soon as practicable after the determination of the board of
directors to redeem the Rights, the Company shall give notice of such redemption
to the holders of the then outstanding Rights by mailing such notice to all such
holders at their last  addresses as they appear upon the  registry  books of the
Rights Agent.  Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption  will state the method by which the payment of the  Redemption  Price
will be made.

          Section 24. NOTICE OF PROPOSED ACTIONS. In case the Company, after the
Rights  become  exercisable,  shall  propose (i) to pay any dividend  payable in
stock of any class to the holders of its Common  Stock or the Subject  Shares or
to make any other  distribution  to the  holders of its Common  Stock or Subject
Shares (other than a regular  periodic cash  dividend),  or (ii) to offer to the
holders of its Common  Stock or Subject  Shares  rights or warrants to subscribe
for or to purchase any  additional  shares of Common Stock or shares of stock of
any class or any other  securities,  rights or  options,  or (iii) to effect any
reclassification   of  its  Common  Stock  or  Subject   Shares  (other  than  a
reclassification  involving only the subdivision of outstanding shares of Common
Stock) or any  recapitalization  or  reorganization  of the Company,  or (iv) to
effect any  consolidation or merger into or with, or to effect any sale or other
transfer  (or to permit  one or more of its  Subsidiaries  to effect any sale or
other  transfer),  in one or more  transactions,  of more than 50 percent of the
assets or earning power of the Company and its  Subsidiaries  (taken as a whole)
to, any other Person,  or (v) to effect the liquidation,  dissolution or winding
up of the  Company,  then,  in each such case,  the  Company  shall give to each
holder of a Right, in accordance  with Section 25, a notice.  The notice of such
proposed  action  shall  specify  the  record  date or the  date on  which  such
reclassification, recapitalization, reorganization, consolidation, merger, sale,
transfer,  liquidation,  dissolution or winding up is to take place and the date
of  participation  therein by the holders of Common Stock and/or Subject Shares,
if any such date is to be fixed. The notice shall be given in 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 Stock and/or Subject Shares for purposes
of such action;  in the case of any other action,  at least 20 days prior to the
date of the taking of such proposed action or the date of participation  therein
by the holders of Common Stock and/or  Subject  Shares,  whichever  shall be the
earlier.  The failure to give notice  required by this  Section 24 or any defect
thereon  shall not affect the  legality or  validity of the action  taken by the
Company or the vote upon any such action.

          Section 25. NOTICES IN GENERAL.  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 given if sent by courier,  facsimile,
or first-class mail, postage prepaid, addressed to:

         OnLine Power Supply, Inc.
         8100 South Akron, Suite 308
         Englewood, Colorado 80112 [Fax 303.741.5641]

                                       25

<PAGE>

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

         Corporate Stock Transfer
         3200 Cherry Creek Drive South, Suite 430
         Denver, Colorado 80209 [Fax 303.282.5800]

          Notices or demands authorized by this Agreement to be given or made by
the  Company  or the Rights  Agent to or on 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 on the Company.

          Section 26. SUPPLEMENTS AND AMENDMENTS. Prior to the Distribution Date
and subject to the  penultimate  sentence of this  Section,  the Company and the
Rights Agent shall, if the Company so directs, supplement or amend any provision
of  this  Agreement   without  the  approval  of  any  holders  of  certificates
representing  shares of Common Stock.  From and after the Distribution  Date and
subject to the penultimate  sentence of this Section, the Company and the Rights
Agent  shall,  if the Company so  directs,  supplement  or amend this  Agreement
without the approval of any holders of Right  Certificates  in order (i) to cure
any  ambiguity,  (ii) to correct or supplement  any provision  contained  herein
which may be defective or inconsistent with any other provisions  herein,  (iii)
to shorten or lengthen  any time  period,  or (iv) to change or  supplement  the
provisions  hereof  in any  manner  which  the  Company  may deem  necessary  or
desirable and which shall not  adversely  affect the interests of the holders of
Right Certificates; provided, however, this Agreement may not be supplemented or
amended  to  lengthen  (A) a time  period  relating  to when the  Rights  may be
redeemed  at such time as the Rights are not then  redeemable,  or (B) any other
time period, unless such lengthening is for the purpose of protecting, enhancing
or clarifying the rights of, and/or the benefits to, the holders of Rights. Upon
the delivery of a certificate  from an appropriate  officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section,  the Rights Agent shall  execute such  supplement or amendment.
Notwithstanding  anything  contained in this  Agreement to the contrary:  (1) no
supplement or amendment  shall be made which changes the Redemption  Price,  the
Purchase  Price  or the  number  of  shares  or  Units  for  which  a  Right  is
exercisable; and (2) the duration of the Rights may not be shortened without the
written consent of the registered holders thereof (other than by a redemption of
the Rights).  Prior to the  Distribution  Date,  the interests of the holders of
Rights shall be deemed  coincident  with the  interests of the holders of Common
Stock.

          Section 27. EXCHANGE OF RIGHTS FOR SHARES OF COMMON STOCK WITHOUT CASH
PAYMENT.

          (a) The board of directors  of the Company may, at its option,  at any
time after any Person becomes an Acquiring  Person,  exchange all or part of the
then  outstanding  and  exercisable  Rights (which shall not include Rights that
have become  subject to Section  7(f)) for Common Stock at an exchange  ratio of
one share of Common Stock per Right, appropriately adjusted to reflect any stock
split,  stock dividend or similar  transaction  occurring  after the date hereof
(such exchange ratio being hereinafter referred to as the "Exchange Ratio").

          (b)  Immediately  upon the  action  of the board of  directors  of the
Company  ordering the exchange of any Rights  pursuant to subsection (a) of this
Section  and without  any  further  action and without any notice,  the right to
exercise such Rights shall  terminate and the only right  thereafter of a holder
of such

                                       26

<PAGE>

Rights  shall be to receive  that number of shares of Common  Stock equal to the
number of such Rights held by such holder  multiplied by the Exchange Ratio. The
Company  shall  promptly  give  public  notice of any such  exchange;  provided,
however,  that the  failure to give,  or any defect in,  such  notice  shall not
affect the validity of such exchange.  The Company  promptly shall mail a notice
of any  such  exchange  to all of the  holders  of such  Rights  at  their  last
addresses as they appear upon the registry books of the Rights Agent. Any notice
which is mailed in the manner herein provided shall be deemed given,  whether or
not the holder  receives  the notice.  Each  notice of  exchange  will state the
method by which the  exchange  of the Common  Stock for Rights  will be effected
and, in the event of any partial  exchange,  the number of Rights  which will be
exchanged.  Any partial  exchange shall be effected pro rata based on the number
of Rights  (other than Rights  which have become  subject to the  provisions  of
Section 7(f)) held by each holder of Rights.

          (c) If there is not  enough  authorized  Common  Stock  to  permit  an
exchange of Rights as contemplated in accordance with this Section,  the Company
shall take all such action as may be necessary to  authorize  additional  Common
Stock or Equivalent Stock for issuance upon exchange of the Rights.

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

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

          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  (and, prior to the
Distribution  Date,  the holders of Common Stock) any legal or equitable  right,
remedy or claim under this  Agreement.  This Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Right  Certificates  (and,  prior to the  Distribution  Date, the holders of
Common Stock).

          Section 31.  GOVERNING LAW;  CHOICE OF VENUE.  This Agreement and each
Right  Certificate  issued hereunder shall be deemed to be a contract made under
the laws of the State of Nevada and for all  purposes  shall be  governed by and
construed in accordance  with the laws of such State  applicable to contracts to
be made and performed  entirely within such State. The rights and obligations of
the Rights  Agent under this  Agreement  shall be governed by and  construed  in
accordance with the laws in effect

                                       27

<PAGE>

in the State of Colorado.  The parties to this Agreement,  the holders of record
of the Rights, irrevocably agree and acknowledge that all disputes involving the
subject  matter of this  Agreement  are to be resolved in the  District  Courts,
Second Judicial District, City and County of Denver, Colorado

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

          Section 33. SECTION HEADINGS.  Descriptive headings of the Sections of
this  Agree- ment are  inserted  only for  convenience  and shall not control or
affect the meaning or construction of any of the provisions hereof.

          Section  34.  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,  illegal,  or  unenforceable,  (i) such invalid,
illegal  or  unenforceable  term,  provision,   covenant  or  restriction  shall
nevertheless be valid,  legal and enforceable to the extent, if any, provided by
such  court or  authority,  and (ii) 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.

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

         ONLINE POWER SUPPLY, INC.:

         -------------------------------
         By: Kris M. Budinger

         Title:  Chairman and Chief Executive Officer

         CORPORATE STOCK TRANSFER, INC.

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

         Title:

                                       28

<PAGE>

                                    EXHIBIT A

                           [Form of Right Certificate]

Certificate No. R-                  Rights
                  ------------------

          THESE  RIGHTS  ARE  NOT  EXERCISABLE  AFTER  PUBLIC   ANNOUNCEMENT  OF
REDEMPTION IS MADE. THE RIGHTS ARE SUBJECT TO  REDEMPTION,  AT THE OPTION OF THE
COMPANY,  AT $.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS  AGREEMENT.  IF
THE  RIGHTS  REPRESENTED  BY THIS  CERTIFICATE  ARE ISSUED TO A PERSON WHO IS AN
ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE THEREOF (AS SUCH TERMS ARE DEFINED
IN THE RIGHTS AGREEMENT) OR CERTAIN TRANSFEREES THEREOF,  THIS RIGHT CERTIFICATE
AND THE RIGHTS REPRESENTED  HEREBY MAY BE SUBJECT TO CERTAIN  LIMITATIONS IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7 OF THE RIGHTS AGREEMENT.

                                RIGHT CERTIFICATE

          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 April 25,  2001 (the  "Rights
Agreement")  between  OnLine  Power  Supply,  Inc.,  a Nevada  corporation  (the
"Company"), and Corporate Stock Transfer, Inc. (the "Rights Agent"), to purchase
from the Company,  unless the Rights have been previously redeemed,  at any time
after the Distribution  Date (defined in the Rights  Agreement) and prior to the
Expiration Date (defined in the Rights Agreement), or the date, if any, on which
the Rights evidenced by this Certificate may be redeemed,  at the stock transfer
office  of  the  Rights  Agent,   or  its   successors  as  Rights  Agent,   one
one-thousandth  (1/1,000th)  of one (1) fully  paid and  nonassessable  share of
Series P Preferred Stock, at a purchase price of $200.00 (the "Purchase Price"),
upon  presentation  and  surrender  of this Right  Certificate  with the Form of
Election to Purchase duly completed and executed. The number of Rights evidenced
by this Right Certificate as set forth above (and the number of shares which may
be purchased upon exercise thereof), and the Purchase Price set forth above, are
the number and Purchase  Price as of the date of the Rights  Agreement  based on
the shares of Common Stock of the Company as constituted at such date.

          Upon the  occurrence of an event  described in clause (A), (B), (C) or
(D) of Section 11(a)(ii) of the Rights Agreement,  the holder of any Rights that
are, or were,  beneficially  owned by an  Acquiring  Person or an  Associate  or
Affiliate thereof (as such terms are defined in the Rights Agreement) or certain
transferees  thereof  which  engaged in, or realized the benefit of, an event or
transaction  or  transactions  described in clause (A),  (B), (C) or (D) of such
Section  11(a)(ii),  shall not be  entitled  to the  benefit  of the  adjustment
described in such Section 11(a)(ii).

          As provided in the Rights Agreement, the Purchase Price and the number
and class of shares  which may be  purchased  upon the  exercise  of the  Rights
evidenced by this Right  Certificate are subject to modification  and adjustment
upon the happening of certain events.

          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.  Reference is
made to the Rights Agreement for a full  description of the rights,  limitations
of rights,

                                       29

<PAGE>

obligations,  duties and immunities  hereunder of the Rights Agent,  the Company
and the holders of the Right  Certificates,  which limitations of rights include
the temporary  suspension of the  exercisability  of such Rights under  specific
circumstances set forth in the Rights Agreement.  Copies of the Rights Agreement
are on file at the office of the Rights Agent and at the principal office of the
Company.

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

          Subject  to  the  Rights  Agreement,  the  Rights  evidenced  by  this
Certificate  may be redeemed by the Company at its option at a redemption  price
of $.01 per Right.

          No  fractional  shares will be issued upon the  exercise of any Rights
evidenced hereby, but in lieu thereof a cash payment may 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 shares or of any
other  securities  of the  Company  which  may at any  time be  issuable  on the
exercise hereof.  Nothing in this Right Certificate and nothing contained in the
Rights  Agreement shall be construed to confer upon the holder hereof,  as such,
any of the rights of a  stockholder  of the Company or any right to vote for the
election  of  directors  or upon any matter  submitted  to  stockholders  at any
meeting thereof,  or to give or withhold consent to any corporate  action, or to
receive notice of meetings or other actions  affecting  stockholders  (except as
provided  in the Rights  Agreement),  or to receive  dividends  or  subscription
rights,  or  otherwise,  until  the  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  signatures  of  the  proper  officers  of the
Company.

Dated as of
            ---------------------------

         Attest:

                                            By
----------------------------------------         -------------------------------
        Secretary                                Title

        Countersigned:

By:
    ------------------------------------
         Authorized Signature

                                       30

<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 Corporation, with
full power of substitution.

Dated: ______________________     ______________________________________________
                                  Signature

Signature Guaranteed:

                                   CERTIFICATE

     The  undersigned  hereby  certifies  (after  due  inquiry  and to the  best
knowledge of the undersigned) by checking the appropriate boxes that:

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

          (2) the  undersigned [ ] did [ ] did not acquire the Rights  evidenced
by this Right Certificate from any Person who is, was or subsequently  became an
Acquiring Person or an Affiliate or Associate of an Acquiring Person.

Dated: ______________________     ______________________________________________
                                   Signature

Dated: ______________________     ______________________________________________
                                   Signature

Dated: ______________________     ______________________________________________
                                   Signature

Signature Guaranteed:

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

                                       31

<PAGE>

                          FORM OF ELECTION TO PURCHASE

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

To the Company and the Rights Agent:

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

Please insert social security or other identifying number: _____________________

________________________________________________________________________________
                         (Please print name and address)

________________________________________________________________________________

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

Please insert social security or other identifying number: _____________________

________________________________________________________________________________
                         (Please print name and address)

________________________________________________________________________________

Dated: _________________     ___________________________________________________
                             Signature

                             (Signature must conform in all respects to name of
                             holder as specified on the face of this Right
                             Certificate)

Signature Guaranteed:

                                       32

<PAGE>

                                   CERTIFICATE

     The  undersigned  hereby  certifies  (after  due  inquiry  and to the  best
knowledge of the undersigned) by checking the appropriate boxes that:

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

              (2)  the  undersigned  [ ] did  [ ] did  not  acquire  the  Rights
evidenced by this Right  Certificate from any person who is, was or subsequently
became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

Dated: _________________     ___________________________________________________
                             Signature

Signature Guaranteed:

                                     NOTICE

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

                                       33

<PAGE>

                                    EXHIBIT B

                                SUMMARY OF RIGHTS

     This summary is qualified  by reference to the detailed  provisions  of the
Rights  Agreement,  a copy of  which  is filed  herewith.  A copy of the  Rights
Agreement is available free of charge from the Company.

     As of April 25, 2001,  the board of directors of OnLine Power Supply,  Inc.
(the "Company")  declared a distribution  of one Right for each  outstanding one
share of common stock (the "Common Shares") of the Company.  The distribution is
to be made as of April 25, 2001 (the "Rights  Record Date") to the  stockholders
of record on that date.  All Common  Shares  issued after the Rights Record Date
also will carry one Right for each share.  The Rights are designed to discourage
unfair  takeovers of the Company,  by  encouraging  a potential  acquiror of the
Company to  negotiate  with the board of directors a fair price for the Company.
The Rights  defined as part of the Rights  Agreement  between  the  Company  and
Corporate  Stock  Transfer,  Inc. as the Rights Agent.  Arrangements  adopted by
United States  corporations  which are similar to the Rights Agreement are often
called  "poison  pills." As summarized  below,  if a Qualified  Offer is made to
acquire all the stock of the Company,  the Rights would be redeemed by the board
of directors, thus causing the poison pill to disappear.

     Each Right  entitles the  registered  holder to purchase  from the Company,
initially, one one-thousandth (1/1,000th) of one (1) share of Series P Preferred
Stock ("Preferred Shares") at a price of $200.00 (the "Purchase Price") for each
1/1,000th  of 1 share,  subject  to  adjustment.  Fractional  shares  may not be
issued,  at the  discretion of the Company,  in which event  fractions  would be
cashed  out.  The terms and  conditions  of the Rights are set forth in a Rights
Agreement  between the  Company and  Corporate  Stock  Transfer,  Inc. as Rights
Agent.

     A Preferred Share  purchasable upon exercise of the Rights will be entitled
to  dividends  equal to 1,000 times the  dividends,  per share,  declared on the
Common Shares.  In the event of liquidation,  a Preferred Share will be entitled
to a minimum  preferential  liquidating  distribution of $1,000 per share and an
aggregate  liquidating  distribution,  per  share,  equal  to  1,000  times  the
distribution made per Common Share. The Preferred Shares will vote together with
the  Common  Shares  and in the  event  of any  merger,  consolidation  or other
transaction in which Common Shares are exchanged,  each Preferred  Share will be
entitled to receive 1,000 times the amount received per Common Share.

     Because of the Preferred Shares' dividend and liquidation rights, the value
when issued of the 1/1,000th of a Preferred Share  purchasable  upon exercise of
each Right should  approximate  the underlying  value (but not  necessarily  the
market value) of one Common Share.

     Until the  earlier  to occur of (i) 10  business  days  following  a public
announcement  that a person or group of  affiliated  or  associated  persons (an
"Acquiring  Person")  has  acquired  beneficial  ownership of 15% or more of the
Company's  general  voting  power other than  pursuant to a Qualified  Offer (as
defined  below),  the date of such public  announcement  being called the "Stock
Acquisition  Date,"  or (ii) 10  business  days  (or such  later  date as may be
determined by action of the board of directors)  following the  commencement of,
or  announcement  of an intention to make, a tender offer or exchange  offer the
consummation  of which would result in the  beneficial  ownership by a person or
group of 15% or more of the  Company's  general  voting  power (the date of such
earlier  occurrence being called the  "Distribution  Date"),  the Rights will be
evidenced  by the  certificates  representing  the  Common  Shares  and  will be
transferred with and only with the Common Shares.  New Common Share certificates
issued after the Rights Record Date upon transfer or new issuance

                                       34

<PAGE>

of Common Shares will contain a notation  incorporating  the Rights Agreement by
reference,  and the surrender for transfer of any certificate for Common Shares,
even  without such  notation or a copy of this Summary of Rights being  attached
thereto,  will also  constitute the transfer of the Rights  associated  with the
Common Shares represented by such certificate.

     If there ever is a Distribution  Date,  then  immediately  the Company will
mail to holders of record of the Common  Shares (as of the close of  business on
the  Distribution  Date)  separate  certificates  evidencing  the Rights ("Right
Certificates"),  and such separate  Right  Certificates  alone will evidence the
Rights.

     The Rights are not exercisable until the Distribution Date. The Rights will
expire on the tenth anniversary of the Rights Record Date (the "Final Expiration
Date"),  unless the Final  Expiration  Date is extended or unless the Rights are
earlier redeemed or exchanged by the Company, as described below.

     The Purchase  Price  payable,  the number of shares or other  securities or
property  issuable  upon exercise of the Rights,  and the number of  outstanding
Rights, are subject to adjustment from time to time to prevent dilution.

     A Qualified  Offer is a tender offer or exchange offer for all  outstanding
Common  Shares which is  determined  by the  directors  not  affiliated  with an
Acquiring  Person  to be fair to and  otherwise  in the  best  interests  of the
Company and its shareholders.

     If any person becomes an Acquiring Person other than by a purchase pursuant
to a Qualified  Offer,  proper  provision shall be made so that each holder of a
Right, other than Rights  beneficially owned by the Acquiring Person (which will
not be entitled  to the benefit of such  adjustment)  will  thereafter  have the
right to receive  upon  exercise  that number of Common  Shares or Common  Share
equivalents  having a market value of two times the exercise  price of the Right
(i.e.,  Common  Shares will be issued at one-half or 50% of market  value at the
time).

     If, at any time after an Acquiring  Person has become such,  the Company is
acquired in a merger or other  business  combination  transaction  (other than a
merger which follows a Qualified  Offer at the same or a higher price) or 50% or
more of its consolidated assets or earning power are sold, proper provision will
be made so that  each  holder  of a Right  will  thereafter  have  the  right to
receive,  upon the exercise  thereof at the then current  exercise  price of the
Right,  that number of shares of common stock of the acquiring  company which at
the time of such  transaction will have a market value of two times the exercise
price of the Right.

     At any time  after an  Acquiring  Person  has  become  such,  the  board of
directors  of the Company may  exchange  the Rights  (other than Rights owned by
such person or group),  in whole or in part, at an exchange  ratio of one Common
Share per one Right  (subject  to  adjustment),  termed  an  "Exchange."  Unlike
exercise of a Right with cash (see the  preceding  paragraph),  such an Exchange
would not require  payment of cash or other  consideration  by the holder of the
Right.

     At any time up to close of business on a Stock  Acquisition Date, the board
of directors of the Company may redeem the Rights in whole,  but not in part, at
a price  of $.01  per  Right  (the  "Redemption  Price").  Immediately  upon any
redemption of the Rights, the right to exercise them will terminate and the only
right of the holders  will be to receive the  Redemption  Price.  However,  such
redemption  only  can be  made in  conjunction  with  the  board  of  directors'
determination that there is a Qualified Offer.

                                       35

<PAGE>

     The terms of the Rights may be  amended by the board of  directors  without
the consent of the  holders of the Rights at any time prior to the  Distribution
Date.  Thereafter  the  Rights  may be  amended  to make  changes  which  do not
adversely affect the interests of the holders of the Rights, or which shorten or
lengthen time periods,  subject to certain  limitations  set forth in the Rights
Agreement.

     Holders of Rights will have no rights as stockholders of the Company, until
Preferred  Shares or Common  Shares are  acquired on exercise or exchange of the
Rights.

     A copy of the  Rights  Agreement  has been filed  with the  Securities  and
Exchange Commission as an Exhibit to a registration statement on Form 8-A.

                                       36

<PAGE>

                                    EXHIBIT C

ONLINE POWER SUPPLY, INC.

Certificate of Designation For Series P Preferred Stock

     OnLine Power Supply, Inc., a Nevada corporation (the "Corporation"), hereby
certifies  that the following  resolution  has been duly adopted by its board of
directors:

     Resolved,  that pursuant to authority  granted to the board of directors of
the  Corporation  by the  articles of  incorporation,  a series of shares of the
Preferred Stock of the Corporation is now  established.  The number of shares in
the series, its designation thereof, and the rights, preferences, privileges and
restrictions  of the shares of such  series,  all are fixed and  established  as
follow:

              I. Designation and Amount

              The series is  designated  the  "Series P  Preferred  Stock."  The
number of shares  constituting  the Series P Preferred  Stock is fifty  thousand
(50,000).  Such number of shares may be increased or decreased by  resolution of
the board of  directors,  but no decrease  shall  reduce the number of shares of
Series P  Preferred  Stock to a number  less  than the  number  of  shares  then
outstanding plus the number of shares reserved for issuance upon the exercise of
outstanding  options,   rights  or  warrants  or  upon  the  conversion  of  any
outstanding  securities  issued by the  Corporation  convertible  into  Series P
Preferred Stock.

              II. Dividends and Distributions

              (A)  Subject  to the  rights of the  holders  of any shares of any
series of Preferred  Stock (or any similar  stock) ranking prior and superior to
the Series P Preferred Stock with respect to dividends, the holders of shares of
Series P Preferred  Stock,  in  preference to the holders of Common Stock of the
Corporation, shall be entitled to receive, when, as and if declared by the board
of directors out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June,  September and December in each
year (a "Quarterly  Dividend  Payment  Date"),  starting on the first  Quarterly
Dividend  Payment Date after the first issuance of a share of Series P Preferred
Stock, in an amount per share (rounded to the nearest cent) equal to the greater
of (a) $1.00 or (b) subject to the  provision  for  adjustment  hereinafter  set
forth,  1,000 times the  aggregate per share amount of all cash  dividends,  and
1,000 times the  aggregate  per share  amount  (payable in kind) of all non-cash
dividends  or other  distributions,  other than a dividend  payable in shares of
Common  Stock or a  subdivision  of the  outstanding  shares of Common Stock (by
reclassification  or  otherwise),   declared  on  the  Common  Stock  since  the
immediately  preceding  Quarterly  Dividend Payment Date or, with respect to the
first Quarterly  Dividend Payment Date, since the first issuance of any share of
Series P Preferred  Stock. If the  Corporation  shall at any time declare or pay
any dividend on the Common Stock payable in shares of Common Stock,  or effect a
subdivision or combination or consolidation of the outstanding  shares of Common
Stock (by  reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the amount to which  holders  of shares of Series P  Preferred
Stock were  entitled  immediately  prior to such event  under  clause (b) of the
preceding  sentence shall be adjusted by multiplying  such amount by a fraction,
the  numerator  of which is the  number of shares  of Common  Stock  outstanding
immediately after such event and

                                       37

<PAGE>

the  denominator  of which is the  number of shares  of Common  Stock  that were
outstanding immediately prior to such event.

              (B) The  Corporation  shall declare a dividend or  distribution on
the Series P  Preferred  Stock as  provided  in  paragraph  (A) of this  Section
immediately  after it declares a dividend or  distribution  on the Common  Stock
(other than a dividend payable in shares of Common Stock);  PROVIDED that, if no
dividend or distribution shall have been declared on the Common Stock during the
period  between any  Quarterly  Dividend  Payment  Date and the next  subsequent
Quarterly  Dividend  Payment Date, a dividend of $1.00 per share on the Series P
Preferred  Stock  shall  nevertheless  be payable on such  subsequent  Quarterly
Dividend Payment Date.

              (C)  Dividends   shall  begin  to  accrue  and  be  cumulative  on
outstanding  shares of Series P  Preferred  Stock  from the  Quarterly  Dividend
Payment Date next preceding the date of issue of such shares, unless the date of
issue of such  shares  is  prior to the  record  date  for the  first  Quarterly
Dividend  Payment  Date,  in which case  dividends on such shares shall begin to
accrue from the date of issue of such  shares,  or unless the date of issue is a
Quarterly  Dividend  Payment  Date or is a date  after the  record  date for the
determination  of  holders of shares of Series P  Preferred  Stock  entitled  to
receive a quarterly dividend and before such Quarterly Dividend Payment Date, in
either of which events such  dividends  shall begin to accrue and be  cumulative
from such Quarterly  Dividend  Payment Date.  Accrued but unpaid dividends shall
not bear interest.  Dividends paid on the shares of Series P Preferred  Stock in
an amount less than the total  amount of such  dividends at the time accrued and
payable on such shares shall be  allocated  pro rata on a  share-by-share  basis
among all such shares at the time outstanding.  The board of directors may fix a
record  date for the  determination  of holders of shares of Series P  Preferred
Stock  entitled  to  receive  payment  of a dividend  or  distribution  declared
thereon,  which  record  date  shall be not more than 60 days  prior to the date
fixed for the payment thereof.

              III. Voting Rights

              The holders of shares of Series P  Preferred  Stock shall have the
following voting rights:

              (A) Subject to the provision for adjustment hereinafter set forth,
each share of Junior  Preferred  Stock shall entitle the holder thereof to 1,000
votes on all matters submitted to a vote of the stockholders of the Corporation.

              (B)  Except  as  otherwise   provided  herein,  or  in  any  other
resolutions  of the board of directors  creating a series of Preferred  Stock or
any similar stock,  or by law, the holders of shares of Series P Preferred Stock
and the  holders of shares of Common  Stock and any other  capital  stock of the
Corporation having general voting rights shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.

              (C) Except as set forth herein, in the  Corporation's  articles of
incorporation  or as  otherwise  provided by law,  holders of Series P Preferred
Stock shall have no voting rights.

              IV. Certain Restrictions

              (A)   Whenever   quarterly   dividends   or  other   dividends  or
distributions  payable on the Series P Preferred Stock as provided in Section II
are in arrears, thereafter and until all accrued and unpaid

                                       38

<PAGE>

dividends  and  distributions,  whether or not  declared,  on shares of Series P
Preferred Stock  outstanding shall have been paid in full, the Corporation shall
not:

                    (i)   declare   or  pay   dividends,   or  make  any   other
distributions,  on any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series P Preferred Stock;

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

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

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

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

              V. Reacquired Shares

              Any shares of Series P Stock  purchased or  otherwise  acquired by
the Corporation in any manner whatsoever shall be retired and cancelled promptly
after the  acquisition  thereof.  All such shares shall upon their  cancellation
become  authorized but unissued shares of Preferred Stock and may be reissued as
part  of a  new  series  of  Preferred  Stock  subject  to  the  conditions  and
restrictions on issuance set forth herein, in the articles of incorporation, any
other  Certificate of  Designations  creating a series of Preferred Stock or any
similar stock or as otherwise required by law.

              VI. Liquidation, Dissolution, or Winding Up

              Upon  any   liquidation,   dissolution   or   winding  up  of  the
Corporation, no distribution shall be made (1) to the holders of shares of stock
ranking  junior  (either as to dividends  or upon  liquidation,  dissolution  or
winding up) to the Series P Preferred Stock unless,  prior thereto,  the holders
of shares of Series P Preferred Stock shall have received $1,000 per share, plus
an amount  equal to accrued  and unpaid  dividends  and  distributions  thereon,
whether or not declared, to the date of such payment,  provided that the holders
of shares of Series P Preferred  Stock shall be entitled to receive an aggregate
amount per share, subject to the provision for adjustment hereinafter set forth,
equal to 1,000 times the aggregate amount to be distributed per

                                       39

<PAGE>

share to holders of shares of Common  Stock,  or (2) to the holders of shares of
stock  ranking  on a  parity  (either  as  to  dividends  or  upon  liquidation,
dissolution  or winding up) with the Series P Preferred  Stock,  except  distri-
butions made  ratably on the Series P Preferred  Stock and all such parity stock
in  proportion  to the total amounts to which the holders of all such shares are
entitled upon such  liquidation,  dissolution or winding up. If the  Corporation
shall at any time  declare or pay any  dividend on the Common  Stock  payable in
shares of Common Stock, or effect a subdivision or combination or  consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than
by  payment of a dividend  in shares of Common  Stock)  into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series P Preferred  Stock were  entitled  immediately
prior to such event  under the proviso in clause (1) of the  preceding  sentence
shall be adjusted by  multiplying  such amount by a fraction  the  numerator  of
which is the number of shares of Common Stock outstanding immediately after such
event and the  denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.

              VII. Consolidation, Merger, Etc.

              In case  the  Corporation  shall  enter  into  any  consolidation,
merger, combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or  securities,  cash and/or any other
property,  then in any such case each share of Series P Preferred Stock shall at
the same time be  similarly  exchanged  or  changed  into an amount  per  share,
subject to the provision for adjustment  hereinafter  set forth,  equal to 1,000
times the aggregate amount of stock, securities,  cash and/or any other property
(payable  in kind),  as the case may be,  into  which or for which each share of
Common  Stock is  changed or  exchanged.  If the  Corporation  shall at any time
declare  or pay any  dividend  on the Common  Stock  payable in shares of Common
Stock,  or  effect  a  subdivision  or  combination  or   consolidation  of  the
outstanding  shares of Common Stock (by  reclassification  or otherwise  than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common  Stock,  then in each such case the  amount set forth in the
preceding  sentence with respect to the exchange or change of shares of Series P
Preferred Stock shall be adjusted by multiplying such amount by a fraction,  the
numerator  of  which  is the  number  of  shares  of  Common  Stock  outstanding
immediately  after  such  event and the  denominator  of which is the  number of
shares of Common Stock that were outstanding immediately prior to such event.

              VIII. Redemption

              The shares of Series P Preferred Stock shall not be redeemable.

              IX. Rank

              The Series P  Preferred  Stock  shall  rank,  with  respect to the
payment of dividends and the distribution of assets, junior to all series of any
other class of the Corporation's Preferred Stock.

              X. Amendment

              The  articles of  incorporation  of the  Corporation  shall not be
amended in any manner  which would alter or change the  powers,  preferences  or
special  rights of the Series P Preferred  Stock so as to affect them  adversely
without  the  affirmative  vote of the  holders  of at least  two-thirds  of the
outstanding  shares of Series P  Preferred  Stock,  voting  together as a single
class.

                                       40

<PAGE>

              IN WITNESS WHEREOF, this Certificate of Designation is executed on
behalf of the  Corporation  by its Chief  Executive  Officer and attested by its
Secretary,  each of whom affirms that the facts stated herein are true this 25th
day of April, 2001.

                                       -----------------------------------------
                                       By:      Kris M. Budinger
                                       Title:   Chief Executive Officer

Attest:

----------------------------------
By:      Richard L. Millspaugh
Title:   Secretary

County of Arapahoe )
State of Colorado  )

     On April 25, 2001 personally  appeared before me, a Notary Public,  Kris M.
Budinger and Richard L.  Millspaugh,  who  acknowledged  that they  executed the
above instrument.

                                       -----------------------------
                                       Notary Public
         SEAL
                                       My Commission Expires: _________

                                       41

<PAGE>

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