Document:

Exhibit 10.3

                                THE BEARD COMPANY

                             2005 STOCK OPTION PLAN

                              Adopted: June 9, 2005

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                                THE BEARD COMPANY
                             2005 STOCK OPTION PLAN

                                Table of Contents

                                                                            Page

ARTICLE I General Provisions.................................................1
    1.1      Purpose.........................................................1
    1.2      General.........................................................1
    1.3      Administration of the Plan......................................1
    1.4      Shares Subject to the Plan......................................1
    1.5      Participation in the Plan.......................................2
    1.6      Determination of Fair Market Value..............................2
    1.7      Grants of Options Under Stock Option Agreement..................2
    1.8      Amendment and Termination of the Plan...........................2
    1.9      Effective Date..................................................2
    1.10     Securities Law Requirements.....................................2
    1.11     Separate Certificates...........................................3
    1.12     Payment for Stock...............................................3
    1.13     Stock Options and ISO Options Granted Separately................3
    1.14     Use of Proceeds.................................................3
    1.15     Non-Transferability of Options..................................3
    1.16     Additional Documents on Death of Participant....................4
    1.17     Changes in Employment...........................................4
    1.18     Shareholder Rights..............................................4
    1.19     Adjustments Upon Changes in Capitalization......................4
    1.20     Payment of Withholding Taxes....................................4
    1.21     Assumption of Outstanding Options...............................5
    1.22     Retirement and Disability.......................................5

ARTICLE II Stock Options.....................................................5
    2.1      General Terms...................................................5
    2.2      Grant and Terms for Stock Options...............................5
        (a) Option Price.....................................................5
        (b) Acceleration of Otherwise Unexercisable Stock Options on
               Retirement, Death, Disability or Other Special Circumstances..6
        (c)    Number of Stock Options Granted...............................6
        (d)    Notice to Exercise Stock Option...............................6

ARTICLE III ISO Options......................................................6
    3.1      General Terms...................................................6
    3.2      Grant and Terms of ISO Options..................................6
        (a)    ISO Option Price..............................................7
        (b)    Annual ISO Option Limitation..................................7
        (c)    Terms of ISO Options..........................................7
        (d)    Acceleration of Otherwise Unexercisable ISO Options on
               Retirement, Death, Disability or Other Special Circumstances..7
        (e)    Number of ISO Options Granted.................................8
        (f)    Notice to Exercise ISO Option.................................8

ARTICLE IV Acceleration of Options on Change of Control......................8
    4.1      Acceleration of Options on Change of Control....................8

ARTICLE V Options Not Qualifying as Incentive Stock Options..................9

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                                THE BEARD COMPANY
                             2005 STOCK OPTION PLAN

ARTICLE I
                               General Provisions

     1.1 Purpose. The purpose of THE BEARD COMPANY 2005 STOCK OPTION PLAN (the
"Plan") shall be to attract, retain and motivate key management, directors or
key professional employees (the "Participants") of The Beard Company (the
"Company") and subsidiaries by way of granting (i) nonqualified stock options
("Stock Options") and (ii) incentive stock options ("ISO Options"). For purposes
of this Plan, Stock Options and ISO Options are sometimes collectively herein
called "Options." The ISO Options to be granted under the Plan are intended to
be qualified pursuant to Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"); and, the Stock Options to be granted are intended to be
"nonqualified stock options" as described in Sections 83 and 421 of the Code.
Further, under the Plan, the terms "parent" and "subsidiary" shall have the same
meaning as set forth in Subsections (e), (f) and (g) of Section 424 of the Code
unless the context herein clearly indicates to the contrary.

     1.2 General. The terms and provisions of this Article I shall be applicable
to Stock Options and ISO Options unless the context herein clearly indicates to
the contrary.

     1.3 Administration of the Plan. The Plan shall be administered by the
Compensation and Stock Option Committee ("Committee") appointed by the Board of
Directors ("Board") of the Company and consisting of not less than two members
from the Board who are not officers or employees of the Company or any
subsidiary. The members of the Committee shall serve at the pleasure of the
Board and such members shall be ineligible to participate under the Plan during
their service as members of the Committee. Committee membership shall be limited
to only those members of the Board who have not, during the year preceding their
appointment, been granted or awarded any "equity securities" (as such term is
defined in Rule 16a-l(d) promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") (or any successor rule) pursuant to the Plan or
any other plan of the Company or any of its affiliates. The Committee shall have
the power where consistent with the general purpose and intent of the Plan to
(i) modify the requirements of the Plan to conform with the law or to meet
special circumstances not anticipated or covered in the Plan, (ii) suspend or
discontinue the Plan, (iii) establish policies and (iv) adopt rules and
regulations and prescribe forms for carrying out the purposes and provisions of
the Plan including the form of any "stock option agreements" ("Stock Option
Agreements"). Unless otherwise provided in the Plan, the Committee shall have
the authority to interpret and construe the Plan, and determine all questions
arising under the Plan and any agreement made pursuant to the Plan. Any
interpretation, decision or determination made by the Committee shall be final,
binding and conclusive. A majority of the Committee shall constitute a quorum,
and an act of the majority of the members present at any meeting at which a
quorum is present shall be the act of the Committee.

     1.4 Shares Subject to the Plan. Shares of stock ("Stock") covered by Stock
Options and ISO Options shall consist of One Hundred Thousand (100,000) shares
of the voting common stock, par value $.0006665, of the Company. Either
authorized and unissued shares or treasury shares may be delivered pursuant to
the Plan. If any Option for shares of Stock granted to a Participant lapses, or
is otherwise terminated, the Committee may grant Stock Options or ISO Options
for such shares of Stock to other Participants.

     1.5 Participation in the Plan. The Committee shall determine from time to
time those Participants who are to be granted Stock Options and ISO Options and
the number of shares of Stock covered thereby. Provided, however, those
directors who are not key management employees of the Company, its parent or
subsidiaries of the Company shall only be eligible to be granted Stock Options
under this Plan.

     1.6 Determination of Fair Market Value. As used in the Plan, "fair market
value" shall mean the last sale price of the common stock of the Company as
reported by the OTC Bulletin Board (i) on the date of the grant or (ii) if there
have been no sales of such securities on the granting date, the most recent sale
reported as of the granting date, exercise date, or other relevant date.

     1.7 Grants of Options Under Stock Option Agreement. Each Stock Option or
ISO Option granted under this Plan shall be evidenced by the minutes of a
meeting of the Committee or by the written consent of the Committee and by a
written Stock Option Agreement effective on the date of grant and executed by
the Company and the Participant. Each Option granted hereunder shall contain
such terms, restrictions and conditions as the Committee may determine, which
terms, restrictions and conditions mayor may not be the same in each case.

     1.8 Amendment and Termination of the Plan. The Plan shall terminate at
midnight, February 2, 2015, but prior thereto may be altered, changed, modified,
amended or terminated by written amendment approved by the Board. Provided, that
no action of the Board may, without the approval of the holders of a majority of
the securities of the Company entitled to vote thereon, increase the aggregate
number of shares of Stock which may be purchased under ISO Options granted under
the Plan; amend or alter the ISO Price; materially increase the benefit accruing
to Participants under the Plan, materially modify the requirements as to
eligibility for participation in the Plan; or amend the Plan in any manner which
would impair the applicability of Rule 16b-3 as promulgated under the Exchange
Act (or any successor rule) to the Plan. Except as provided in this Article I,
no amendment, modification or termination of the Plan shall in any manner
adversely affect any Stock Option or ISO Option theretofore granted under the
Plan without the consent of the affected Participant.

     1.9 Effective Date. The Plan has been unanimously approved by the board of
directors of the Company on February 3, 2005, and is therefore effective as of
such date.

     1.10 Securities Law Requirements. The Company shall have no obligation to
issue any Stock hereunder unless such shares are listed on the applicable stock
exchange(s), if any, on which the Company's shares of Stock are listed at the
time and the issuance of such shares would comply with any applicable federal or
state securities laws or any other applicable law or regulations thereunder.

     1.11 Separate Certificates. Separate certificates representing the common
stock of the Company to be delivered to a Participant upon the exercise of any
Stock Options or ISO Options will be issued to such Participant.

     1.12 Payment for Stock. Payment for shares of Stock purchased under this
Plan shall be made in full and in cash or by check, Stock of the Company or a
combination thereof, at the time of exercise of the Options as a condition
thereof, and no loan or advance shall be made by the Company for the purpose of
financing, in whole or in part, the purchase of Stock. In the event that common
stock of the Company is utilized as consideration for the purchase of Stock upon
the exercise of a Stock Option or an ISO Option, then, such common stock shall
be valued at the "fair market value" as defined in Section 1.6 of the Plan. In
addition to the foregoing procedure which may be available for the exercise of
any Stock Option or ISO Option, the Participant may deliver to the Company a
notice of exercise including an irrevocable instruction to the Company to
deliver the stock certificate issued in the name of the Participant representing
the shares subject to an Option to a broker authorized to trade in the common
stock of the Company. Upon receipt of such notice, the Company will acknowledge
receipt of the executed notice of exercise and forward this notice to the
broker. Upon receipt of the copy of the notice which has been acknowledged by
the Company, and without waiting for issuance of the actual stock certificate
with respect to the exercise of the Option, the broker may sell the Stock or any
portion thereof. Upon receipt of the notice to exercise from the Company, the
broker will deliver directly to the Company that portion of the sales proceeds
to cover the Option Price and any withholding taxes, if any. Further, the broker
may also facilitate a loan to the Participant upon receipt of the notice of
exercise in advance of the issuance of the actual stock certificate as an
alternative means of financing and facilitating the exercise of any Option. For
all purposes of effecting the exercise of an Option, the date on which the
Participant gives the notice of exercise to the Company will be the date he
becomes bound contractually to take and pay for the shares of Stock underlying
the Option. The Committee may also adopt such other procedures which it desires
for the payment of the purchase price upon the exercise of a Stock Option or ISO
Option which are not inconsistent with the applicable provisions of the Code
which relate to Stock Options and ISO Options.

     1.13 Stock Options and ISO Options Granted Separately. Since the Committee
is authorized to grant Stock Options and ISO Options to Participants, the grants
thereof and Stock Option Agreements relating thereto will be made separately and
totally independent of each other. Except as it relates to the total number of
shares of Stock which may be issued under the Plan, the grant or exercise of a
Stock Option shall in no manner affect the grant and exercise of any ISO
Options. Similarly, the grant and exercise of an ISO Option shall in no manner
affect the grant and exercise of any Stock Options.

     1.14 Use of Proceeds. The proceeds received by the Company from the sale of
Stock pursuant to the exercise of Options granted under the Plan shall be added
to the Company's general funds and used for general corporate purposes.

     1.15 Non-Transferability of Options. Except as otherwise herein provided,
any Option granted shall not be transferable otherwise than by will or the laws
of descent and distribution, and the Option may be exercised, during the
lifetime of the Participant, only by him. More particularly (but without
limiting the generality of the foregoing), the Option shall not be assigned,
transferred (except as provided above), pledged or hypothecated in any way
whatsoever, shall not be assignable by operation of law and shall not be subject
to execution, attachment, or similar process. Any attempted assignment,
transfer, pledge, hypothecation, or other disposition of the Option contrary to
the provisions hereof shall be null and void and without effect.

     1.16 Additional Documents on Death of Participant. No transfer of an Option
by the Participant by will or the laws of descent and distribution shall be
effective to bind the Company unless the Company shall have been furnished with
written notice and an authenticated copy of the will and/or such other evidence
as the Committee may deem necessary to establish the validity of the transfer
and the acceptance by the successor to the Option of the terms and conditions of
such Option.

     1.17 Changes in Employment. So long as the Participant shall continue to be
an employee of the Company or its parent or one of its subsidiaries, any Option
granted to him shall not be affected by any change of duties or position.
Nothing in the Plan or in any Stock Option Agreement which relates to the Plan
shall confer upon any Participant any right to continue in the employ of the
Company or its parent or any of its subsidiaries, or interfere in any way with
the right of the Company or its parent or any of its subsidiaries to terminate
his employment at any time.

     1.18 Shareholder Rights. No Participant shall have a right as a shareholder
with respect to any shares of Stock subject to an Option prior to the purchase
of such shares of Stock by exercise of the Option.

     1.19 Adjustments Upon Changes in Capitalization. The aggregate number of
shares of Stock under Stock Options and ISO Options granted under the Plan, the
Option Price and the ISO Price and the total number of shares of Stock which may
be purchased by a Participant on exercise of a Stock Option and an ISO Option
shall be appropriately adjusted or modified by the Committee to reflect any
recapitalization, stock split, merger, consolidation, reorganization,
combination, liquidation, stock dividend or similar transaction involving the
Company. Provided, any such adjustment shall be made in such a manner as to not
constitute a modification as defined in Section 424(h) of the Code.

     1.20 Payment of Withholding Taxes. Except as provided in Section 1.12
herein, no exercise of any Option shall be permitted, nor shall any Stock be
issued to any Participant until the Company receives full payment for the Stock
purchased which shall include any required state and federal withholding taxes.
Further, upon the exercise of any Stock Option, the Participant may direct the
Company to retain from the shares of Stock to be issued upon exercise of the
Stock Option that number of initial shares of Stock (based on fair market value)
that would be necessary to satisfy the requirements for withholding any amounts
of taxes due upon the exercise of such Stock Option. In the event that the
Participant disposes of any Stock acquired by the exercise of an ISO Option
within the two-year period following grant, or within the one-year period
following exercise, of the ISO Option, the Company shall have the right to
require the Participant to remit to the Company an amount sufficient to satisfy
all federal, state and local withholding tax requirements.

     1.21 Assumption of Outstanding Options. To the extent permitted by the then
applicable provisions of the Code, any successor to the Company succeeding to,
or assigned the business of, the Company as the result of or in connection with
a corporate merger, consolidation, combination, reorganization, liquidation or
other corporate transaction shall assume Options outstanding under the Plan or
issue new Options in place of outstanding Options under the Plan with such
assumption to be made on a fair and equivalent basis in accordance with the
applicable provisions of Section 424(a) of the Code; provided, in no event will
such assumption result in a modification of any Option as defined in Section
424(h) of the Code.

     1.22 Retirement and Disability. For the purpose of this Plan, "Retirement"
shall mean the voluntary termination of employment of a Participant with the
Company, its parent or any of its subsidiaries after attaining at least 55 years
of age; and, "Disability" shall mean termination of employment of a Participant
after incurring a "disability" as defined in Section 22(e)(3) of the Code.

                                   ARTICLE II
                                  Stock Options

     2.1 General Terms. With respect to Stock Options granted on or after the
effective date of the Plan, the following provisions of this Article II shall
apply. The Stock Options granted under this Article II are intended to be
"nonqualified stock options" as described in Sections 83 and 421 of the Code.

     2.2 Grant and Terms for Stock Options. Stock Options shall be granted on
the following terms and conditions. Stock Options shall only be granted to key
management employees, directors or key professional employees of the Company,
its parent or any subsidiary of the Company. No Stock Option shall be
exercisable more than ten (10) years from the date of grant. Subject to such
limitations, the Committee shall have the discretion to fix the period ("Option
Period") during which Stock Options may be exercised. At all times during the
period commencing with the date a Stock Option is granted to a Participant and
ending on the earlier of the expiration of the Option Period applicable to such
Stock Option or the date which is three (3) months prior to the date the Stock
Option is exercised by such Participant, such Participant must be an employee or
a director of either (i) the Company, (ii) a parent or a subsidiary corporation
of the Company, or (iii) a corporation or parent or a subsidiary corporation of
such corporation issuing or assuming a Stock Option in a transaction to which
Section 424(a) of the Code applies. Provided, in the case of a Participant who
has incurred a Disability, the aforesaid three (3) month period shall mean a one
(1) year period. Provided further, in the event a Participant's employment or
director's position is terminated by reason of his death, his personal
representative may exercise any unexercised Stock Option granted to the
Participant under the Plan at any time within one (1) year after the
Participant's death but in any event not after the expiration of the Option
Period applicable to such Stock Option.

          (a) Option Price. The option price ("Option Price") for shares of
Stock subject to any Stock Option shall be determined by the Committee, but in
no event shall such Option Price be less than 75% of the "fair market value" of
the Stock on the date of grant. Provided further, in no event shall the Option
Price be less than the par value of the Stock.

          (b) Acceleration of Otherwise Unexercisable Stock Options on
Retirement, Death, Disability or Other Special Circumstances. The Committee, in
its sole discretion, may permit (i) a Participant who terminates employment due
to Retirement, (ii) a Participant who terminates employment due to a Disability,
(iii) the personal representative of a deceased Participant, or (iv) any other
Participant who terminates employment or his director's position upon the
occurrence of special circumstances (as determined by the Committee) to purchase
(within three (3) months of such date of termination of employment or one (1)
year in the case of a deceased Participant or a Participant suffering a
Disability) all or any part of the shares subject to any Stock Option on the
date of the Participant's Retirement, Disability, death, or as the Committee
otherwise so determines, notwithstanding that all installments, if any, with
respect to such Stock Option, had not yet accrued on such date.

          (c) Number of Stock Options Granted. Participants may be granted more
than one Stock Option. In making any such determination, the Committee shall
obtain the advice and recommendation of the officers of the Company, its parent,
or a subsidiary of the Company which have supervisory authority over such
Participants. The granting of a Stock Option under the Plan shall not affect any
outstanding Stock Option previously granted to a Participant under the Plan (or
any other plans of the Company).

          (d) Notice to Exercise Stock Option. Upon exercise of a Stock Option,
a Participant shall give written notice to the Secretary or Personnel Manager of
the Company, or other officer designated by the Committee, at the Company's
principal office. No Stock shall be issued to any Participant until the Company
receives full payment for the Stock purchased under the Stock Option, including
any required state and federal withholding taxes; provided, however, nothing
herein shall be construed as requiring payment of withholding taxes at the time
of exercise if payment of taxes is deferred pursuant to any provision of the
Code, and actions are taken which are designed to reasonably insure payment of
withholding taxes when due.

                                   ARTICLE III
                                   ISO Options

     3.1 General Terms. With respect to ISO Options granted on or after the
effective date of the Plan the following provisions in this Article III shall
apply to the exclusion of any inconsistent provision in any other Article in
this Plan since the ISO Options to be granted under the Plan are intended to
qualify as "incentive stock options" as defined in Section 422 of the Code.

     3.2 Grant and Terms of ISO Options. ISO Options may be granted only to key
management or key professional employees of the Company, its parent or any
subsidiary of the Company. No ISO Options shall be granted to any person who is
not eligible to receive "incentive stock options" as provided in Section 422 of
the Code. No ISO Options shall be granted to any key management or key
professional employee if, immediately before the grant of an ISO Option, such
employee owns more than 10% of the total combined voting power of all classes of
stock of the Company, its parent or its subsidiaries (as determined in
accordance with the stock attribution rules contained in Section 422 and Section
424( d) of the Code). Provided, the preceding sentence shall not apply if, at
the time the ISO Option is granted, the ISO Price (as defined below) is at least
110% of the "fair market value" of the Stock subject to the ISO Option, and such
ISO Option by its terms is exercisable no more than five (5) years from the date
such ISO Option is granted.

          (a) ISO Option Price. The option price for shares of Stock subject to
an ISO Option ("ISO Price") shall be determined by the Committee, but in no
event shall such ISO Price be less than the greater of (a) the "fair market
value" of the Stock on the date of grant or (b) the par value of the Stock.

          (b) Annual ISO Option Limitation. With respect to ISO Options granted,
in no event during any calendar year will the aggregate "fair market value"
(determined as of the time the ISO Option is granted) of the Stock for which the
Participant may first have the right to exercise under an ISO Option granted
under all "incentive stock option" plans qualified under Section 422 of the Code
which are sponsored by the Company, its parent and its subsidiary corporations
exceed $100,000. For purposes of this Section 3.2(b), "incentive stock options,"
as defined under Section 422 (and its predecessor Section 422A) of the Code,
granted prior to January 1, 1987, shall be disregarded when calculating the
foregoing $100,000 limitation.

          (c) Terms of ISO Options. ISO Options shall be granted on the
following terms and conditions: No ISO Option shall be exercisable more than ten
(10) years from the date of grant. Subject to such limitations, the Committee
shall have the discretion to fix the period (the "ISO Period") during which any
ISO Option may be exercised. ISO Options granted shall not be transferable
except by wi1l or by laws of descent and distribution. At all times during the
period commencing with the date an ISO Option is granted to a Participant and
ending on the earlier of the expiration of the ISO Period applicable to such ISO
Options or the date which is three (3) months prior to the date the ISO Option
is exercised by such Participant, such Participant must be an employee of either
(i) the Company, (ii) a parent or a subsidiary corporation of the Company, or
(iii) a corporation or a parent or a subsidiary corporation of such corporation
issuing or assuming an ISO Option in a transaction to which Section 424(a) of
the Code applies. Provided, in the case of a Participant who incurs a
Disability, the aforesaid three (3) month period shall mean a one (1) year
period. Provided further, in the event a Participant's employment is terminated
by reason of his death, his personal representative may exercise any unexercised
ISO Option granted to the Participant under the Plan at any time within one (1)
year after the Participant's death but in any event not after the expiration of
the ISO Period applicable to such ISO Option.

          (d) Acceleration of Otherwise Unexercisable ISO Options on Retirement,
Death, Disability or Other Special Circumstances. The Committee, in its sole
discretion, may permit (i) a Participant who terminates employment due to
Retirement, (ii) a Participant who terminates employment due to a Disability,
(iii) the personal representative of a deceased Participant, or (iv) any other
Participant who terminates employment upon the occurrence of special
circumstances (as determined by the Committee) to purchase (within three (3)
months of such date of termination of employment or one (1) year in the case of
a deceased Participant or a Participant suffering a Disability) all or any part
of the shares subject to any ISO Option on the date of the Participant's
Retirement, Disability, death, or as the Committee otherwise so determines,
notwithstanding that all installments, if any, had not accrued on such date.

          (e) Number of ISO Options Granted. Subject to the applicable
limitations contained in the Plan with respect to ISO Options, Participants may
be granted more than one ISO Option. In making any such determination, the
Committee shall obtain the advice and recommendation of the officers of the
Company, its parent or a subsidiary of the Company which have supervisory
authority over such Participants. Further, the granting of an ISO Option under
the Plan shall not affect any outstanding ISO Option previously granted to a
Participant under the Plan.

          (f) Notice to Exercise ISO Option. Upon exercise of an ISO Option, a
Participant shall give written notice to the Secretary of the Company, or other
officer designated .by the Committee, at the Company's main office in Oklahoma
City, Oklahoma. No Stock shall be issued to any Participant until the Company
receives full payment for Stock purchased under the ISO Option.

                                   ARTICLE IV
                  Acceleration of Options on Change of Control

     4.1 Acceleration of Options on Change of Control. In the event that a
Change of Control (as defined herein) has occurred with respect to the Company,
any and all ISO Options and Stock Options become automatically fully vested and
immediately exercisable with such acceleration to occur without the requirement
of any further act by either the Company or the Participant. For the purposes of
this Section 4.1, the term "Change of Control" shall mean:

          (i) The acquisition in a transaction or a series of transactions by
any person, entity or "group," within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act"), of
beneficial ownership, of 30% or more of either the then outstanding shares of
common stock or the combined voting power of the Company's then outstanding
voting securities; provided, however, that any acquisition of beneficial
ownership of common stock or voting securities of the Company which is less than
30% of either the then outstanding shares of common stock or the combined voting
power of the Company's then outstanding voting securities shall be deemed to be
a "change of control" for the purposes of this Agreement if a majority of the
Incumbent Board determines that such acquisition has caused a change of control
to occur;

          (ii) Individuals who, as of the date hereof, constitute the Board of
Directors of the Company (as of the date hereof the "Incumbent Board") cease for
any reason to constitute at least a majority of the Board, provided that any
person becoming a director subsequent to the date hereof whose election, or
nomination for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors comprising the Incumbent Board (other than
an election or nomination of an individual whose initial assumption of office is
in connection with an actual or threatened election contest relating to the
election of the Directors of the Company, as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act) shall be, for purposes of
this Agreement, considered as though such person were a member of the Incumbent
Board; or

          (iii) Approval by the stockholders of the Company of (A) a
reorganization, merger or consolidation, in each case with respect to which the
stockholders of the Company will not, immediately after consummation thereof,
own more than 50% of the combined voting power of the then outstanding voting
securities of either (a) the consolidated company or the surviving company in
the reorganization or merger, or (b) any company which prior to the
consolidation, reorganization or merger owned 50% or more of the combined voting
power of its then outstanding voting securities; provided, however, no Change of
Control shall be deemed to have occurred if members of the Incumbent Board will,
immediately thereafter, constitute at least a majority of the board of directors
of the consolidated or surviving company, or any company which owns, directly or
indirectly, at least a majority of the voting power of the consolidated or
surviving company's outstanding voting securities, and the Incumbent Board has
determined, prior to such shareholder approval, that a Change of Control shall
not be deemed to result from such transaction; or (B) a liquidation or
dissolution of the Company or the sale of all or substantially all of the assets
of the Company.

                                   ARTICLE V
                Options Not Qualifying as Incentive Stock Options

     With respect to all or any portion of any Option granted under the Plan not
qualifying as an "incentive stock option" under Section 422 of the Code, such
Option shall be considered as a Stock Option granted under this Plan for all
purposes. Further, this Plan and any ISO Options granted hereunder shall be
deemed to have incorporated by reference all the provisions and requirements of
Section 422 of the Code (and the Treasury Regulations issued thereunder) which
are required to provide that all ISO Options granted hereunder shall be
"incentive stock options" described in Section 422 of the Code.STOCKHOLDERS RIGHTS AGREEMENT

          This Stockholders  Rights Agreement (this "Rights  Agreement") is made
and entered  into as of August 19,  2005,  by and between  TOP Tankers  Inc.,  a
Marshall  Islands  corporation  (the  "Company"),   and  Computershare  Investor
Services, LLC, as Rights Agent (the "Rights Agent").

          WHEREAS,  the Board of Directors of the Company (the  "Board") has (a)
authorized  and declared a dividend of one right (the "Right") for each share of
the Company's  common stock,  par value $.01 per share (the "Common Stock") held
of record as of the Close of Business (as  hereinafter  defined) on September 7,
2005 (the  "Record  Date") and (b) has further  authorized  the  issuance of one
Right in respect of each share of Common Stock that shall become outstanding (i)
at any time between the Record Date and the earliest of the  Distribution  Date,
the Redemption Date or the Final  Expiration Date (as such terms are hereinafter
defined) or (ii) upon the  exercise or  conversion,  prior to the earlier of the
Redemption  Date or the Final  Expiration  Date, of any option or other security
exercisable  for or  convertible  into shares of Common  Stock,  which option or
other such security is outstanding on the Distribution Date; and

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

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

     1.   Certain Definitions.

          "Acquiring  Person" shall mean any Person who or which,  together with
all Affiliates and Associates of such Person,  shall be the Beneficial  Owner of
15% or more of the  shares  of  Common  Stock  then  outstanding,  but shall not
include the Company,  any Subsidiary of the Company or any employee benefit plan
of the Company or of any Subsidiary of the Company, or any entity holding shares
of Common  Stock for or pursuant to the terms of any such plan.  Notwithstanding
the foregoing, no Person shall be deemed to be an Acquiring Person as the result
of an acquisition  of shares of Common Stock by the Company  which,  by reducing
the number of shares outstanding,  increases the proportionate  number of shares
beneficially  owned by such Person to 15% or more of the shares of Common  Stock
of the  Company  then  outstanding;  provided,  however,  that a Person  who (i)
becomes the Beneficial Owner of 15% or more of the shares of Common Stock of the
Company then  outstanding  by reason of share  purchases by the Company and (ii)
then after such share purchases by the Company,  becomes the Beneficial Owner of
any  additional  shares of Common Stock of the Company (other than pursuant to a
dividend or distribution  paid or made by the Company on the outstanding  shares
of Common Stock in shares of Common Stock or pursuant to a split or  subdivision
of the outstanding shares of Common Stock), such Person shall be deemed to be an
Acquiring  Person unless upon becoming the Beneficial  Owner of such  additional
shares of Common Stock of the Company such Person does not  beneficially own 15%
or  more  of the  shares  of  Common  Stock  of the  Company  then  outstanding.
Notwithstanding  the  foregoing,   (i)  if  the  Company's  Board  of  Directors
determines  in good  faith that a Person who would  otherwise  be an  "Acquiring
Person," as defined herein,  has become such inadvertently  (including,  without
limitation,  because (A) such Person was unaware  that it  beneficially  owned a
percentage of the shares of Common Stock that would  otherwise cause such Person
to be an "Acquiring  Person," as defined herein, or (B) such Person was aware of
the extent of the shares of Common Stock it beneficially owned but had no actual
knowledge of the consequences of such beneficial ownership under this Agreement)
and without any intention of changing or influencing control of the Company, and
if such  Person  divested or divests as promptly  as  practicable  a  sufficient
number  of shares of  Common  Stock so that  such  Person  would no longer be an
"Acquiring  Person," as defined herein,  then such Person shall not be deemed to
be or to have become an "Acquiring  Person" for any purposes of this  Agreement;
and (ii) if, as of the date hereof, any Person is the Beneficial Owner of 15% or
more of the shares of Common  Stock  outstanding,  such  Person  shall not be or
become an "Acquiring  Person," as defined herein,  unless and until such time as
such Person shall become the  Beneficial  Owner of  additional  shares of Common
Stock  in an  amount  equal to 20% of the  Company's  outstanding  common  stock
(calculated  without  including  the shares of Common Stock already held by such
Person), other than pursuant to a grant under a Company equity incentive plan, a
dividend or distribution  paid or made by the Company on the outstanding  shares
of Common Stock in shares of Common Stock or pursuant to a split or  subdivision
of the outstanding shares of Common Stock,  unless, upon becoming the Beneficial
Owner of such  additional  shares of Common  Stock,  such Person is not then the
Beneficial Owner of 15% or more of the shares of Common Stock then outstanding.

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

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

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

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

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

              (iii) which are  beneficially  owned,  directly or indirectly,  by
                    any other Person (or any  Affiliate  or  Associate  thereof)
                    with which such Person or any of such Person's Affiliates or
                    Associates has any agreement,  arrangement or understanding,
                    whether or not in writing (other than  customary  agreements
                    with and between underwriters and selling group members with
                    respect to a bona fide public  offering of  securities)  for
                    the purpose of  acquiring,  holding,  voting  (except to the
                    extent  contemplated  by the proviso to  subsection  (ii)(B)
                    above)  or  disposing  of any  securities  of  the  Company;
                    provided,  however,  that in no case  shall  an  officer  or
                    director of the Company be deemed (x) the  Beneficial  Owner
                    of any securities  beneficially  owned by another officer or
                    director  of  the  Company   solely  by  reason  of  actions
                    undertaken by such persons in their  capacity as officers or
                    directors  of the  Company  or (y) the  Beneficial  Owner of
                    securities  held of record by the  trustee  of any  employee
                    benefit plan of the Company or any Subsidiary of the Company
                    for  the  benefit  of any  employee  of the  Company  or any
                    Subsidiary  of  the  Company,  other  than  the  officer  or
                    director,  by reason of any  influence  that such officer or
                    director may have over the voting of the securities  held in
                    the plan.

          "Business  Day" shall mean any day other than a Saturday,  Sunday or a
day on which the New York Stock  Exchange is  authorized  or obligated by law or
executive order to close.

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

          "Common  Stock"  shall  have the  meaning  set forth in the  preamble.
Common Stock when used with reference to any Person other than the Company shall
mean the capital stock (or equity  interest)  with the greatest  voting power of
such other Person or, if such other Person is a  Subsidiary  of another  Person,
the Person or Persons which ultimately control such first-mentioned Person.

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

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

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

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

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

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

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

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

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

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

          "Final Expiration Date" shall mean August 31, 2015.

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

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

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

          "Preferred  Shares"  shall  mean  shares  of  Series  A  Participating
Preferred Stock, $0.01 par value, of the Company.

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

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

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

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

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

          "Rights Agent" shall mean Computershare Investor Services, LLC, or its
successor or replacement as provided in Sections 19 and 21 hereof.

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

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

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

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

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

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

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

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

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

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

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

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

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

     3.   Issuance of Rights Certificates.

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

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

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

     THIS  CERTIFICATE  ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN
     RIGHTS AS SET FORTH IN A STOCKHOLDER  RIGHTS AGREEMENT  BETWEEN TOP TANKERS
     INC. AND COMPUTERSHARE  INVESTOR SERVICES,  LLC, AS THE RIGHTS AGENT, DATED
     AS OF AUGUST 19,  2005,  (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  TOP  TANKERS  INC.  UNDER  CERTAIN
     CIRCUMSTANCES,  AS SET FORTH IN THE RIGHTS  AGREEMENT,  SUCH RIGHTS WILL BE
     EVIDENCED BY SEPARATE  CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS
     CERTIFICATE. TOP TANKERS INC. WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A
     COPY OF THE RIGHTS  AGREEMENT  WITHOUT  CHARGE  AFTER  RECEIPT OF A WRITTEN
     REQUEST  THEREFOR.  UNDER  CERTAIN  CIRCUMSTANCES  SET FORTH IN THE  RIGHTS
     AGREEMENT,  RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES
     AN ACQUIRING  PERSON OR ANY  AFFILIATE OR ASSOCIATE  THEREOF (AS SUCH TERMS
     ARE  DEFINED  IN THE RIGHTS  AGREEMENT),  WHETHER  CURRENTLY  HELD BY OR ON
     BEHALF OF SUCH  PERSON OR BY ANY  SUBSEQUENT  HOLDER,  MAY BECOME  NULL AND
     VOID.

With respect to such  certificates  containing the foregoing  legend,  until the
earlier of (i) the  Distribution  Date or (ii) the  Expiration  Date, the Rights
associated  with the shares of Common  Stock  represented  by such  certificates
shall be evidenced by such certificates alone, and the surrender for transfer of
any such certificate shall also constitute the transfer of the Rights associated
with the shares of Common Stock represented thereby.

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

     4.   Form of Rights Certificates.

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

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

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

     5.   Countersignature and Registration.

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

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

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

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

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

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

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

          (b) The Exercise Price for each  one-thousandth  of a Preferred  Share
issuable  pursuant to the  exercise of a Right shall  initially  be  twenty-five
Dollars ($25),  shall be subject to adjustment  from time to time as provided in
Sections  11 and 13 hereof and shall be  payable  in lawful  money of the United
States of America in accordance with paragraph (c) below.

          (c) Upon  receipt  of a Rights  Certificate  representing  exercisable
Rights,  with the form of election to purchase  duly  executed,  accompanied  by
payment of the Exercise Price for the number of  one-thousandths  of a Preferred
Share (or, following a Triggering Event, other securities,  cash or other assets
as the case  may be) to be  purchased  and an  amount  equal  to any  applicable
transfer  tax  required to be paid by the holder of such Rights  Certificate  in
accordance with Section 9(e) hereof, the Rights Agent shall,  subject to Section
20(k) hereof,  thereupon promptly (i) (A) requisition from any transfer agent of
the  Preferred  Shares (or make  available,  if the Rights Agent is the transfer
agent for the Preferred  Shares) a certificate or certificates for the number of
one-thousandths  of a Preferred Share (or,  following a Triggering Event,  other
securities,  cash or other  assets as the case may be) to be  purchased  and the
Company hereby irrevocably authorizes its transfer agent to comply with all such
requests or (B) if the Company shall have elected to deposit the total number of
one-thousandths  of a Preferred Share (or,  following a Triggering Event,  other
securities,  cash or other assets as the case may be) issuable  upon exercise of
the Rights  hereunder with a depositary  agent,  requisition from the depositary
agent  depositary  receipts  representing  such number of  one-thousandths  of a
Preferred Share (or,  following a Triggering Event,  other  securities,  cash or
other  assets  as  the  case  may  be) as are to be  purchased  (in  which  case
certificates for the Preferred Shares (or,  following a Triggering Event,  other
securities,  cash or  other  assets  as the  case  may be)  represented  by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company  hereby  directs the  depositary  agent to comply with such request,
(ii) when  appropriate,  requisition  from the  Company the amount of cash to be
paid in lieu of issuance of  fractional  shares in  accordance  with  Section 14
hereof, (iii) after receipt of such certificates or depositary  receipts,  cause
the same to be delivered to or upon the order of the  registered  holder of such
Rights  Certificate,  registered  in such name or names as may be  designated by
such holder and (iv) when appropriate,  after receipt thereof, deliver such cash
to or upon the order of the registered  holder of such Rights  Certificate.  The
payment of the Exercise Price (as such amount may be reduced (including to zero)
pursuant to Section  11(a)(iii)  hereof) and an amount  equal to any  applicable
transfer  tax  required to be paid by the holder of such Rights  Certificate  in
accordance  with Section 9(e) hereof,  may be made in cash or by certified  bank
check, cashier's check or bank draft payable to the order of the Company. In the
event that the Company is obligated  to issue  securities  of the Company  other
than Preferred  Shares,  pay cash and/or  distribute other property  pursuant to
Section 11(a) hereof,  the Company will make all arrangements  necessary so that
such other securities, cash and/or other property are available for distribution
by the Rights Agent, if and when appropriate.

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

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

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

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

     9. Reservation and Availability of Preferred Shares.

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

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

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

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

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

     10. Record Date.  Each Person in whose name any certificate for a number of
one-thousandths  of a Preferred  Share (or other  securities  of the Company) is
issued  upon the  exercise  of Rights  shall for all  purposes be deemed to have
become the holder of record of  Preferred  Shares  (or other  securities  of the
Company) represented thereon, and such certificate shall be dated, the date upon
which the Rights  Certificate  evidencing  such Rights was duly  surrendered and
payment of the Total  Exercise  Price with respect to which the Rights have been
exercised (and any applicable transfer taxes) was made; provided,  however, that
if the date of such  surrender  and  payment is a date upon  which the  transfer
books of the Company are closed,  such Person shall be deemed to have become the
record holder of such shares on, and such  certificate  shall be dated, the next
succeeding  Business  Day on which the  transfer  books of the Company are open.
Prior to the exercise of the Rights  evidenced  thereby,  the holder of a Rights
Certificate  shall not be entitled to any rights of a holder of Preferred Shares
(or other  securities of the Company) for which the Rights shall be exercisable,
including,  without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be entitled to
receive any notice of any proceedings of the Company, except as provided herein.

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

          (a) (i) Notwithstanding anything in this Agreement to the contrary, in
          the  event  the  Company  shall  at any  time  after  the date of this
          Agreement  (A) declare a dividend on the Preferred  Shares  payable in
          Preferred Shares, (B) subdivide the outstanding  Preferred Shares, (C)
          combine the  outstanding  Preferred  Shares (by reverse stock split or
          otherwise) into a smaller number of Preferred Shares, or (D) issue any
          shares of its capital  stock in a  reclassification  of the  Preferred
          Shares  (including  any such  reclassification  in  connection  with a
          consolidation  or merger in which the  Company  is the  continuing  or
          surviving corporation),  then, in each such event, except as otherwise
          provided in this Section 11 and Section 7(e) hereof:  (1) the Exercise
          Price in effect at the time of the record date for such dividend or of
          the   effective   date   of   such    subdivision,    combination   or
          reclassification   shall  be  adjusted  so  that  the  Exercise  Price
          thereafter  shall equal the result  obtained by dividing  the Exercise
          Price in  effect  immediately  prior to such time by a  fraction  (the
          "Adjustment  Fraction"),  the  numerator  of which  shall be the total
          number of Preferred  Shares (or shares of capital stock issued in such
          reclassification  of the  Preferred  Shares)  outstanding  immediately
          following  such time and the  denominator  of which shall be the total
          number of Preferred Shares outstanding immediately prior to such time;
          provided, however, that in no event shall the consideration to be paid
          upon the exercise of one Right be less than the aggregate par value of
          the shares of capital  stock of the Company  issuable upon exercise of
          such Right; and (2) the number of one-thousandths of a Preferred Share
          (or share of such other capital  stock)  issuable upon the exercise of
          each Right  shall equal the number of  one-thousandths  of a Preferred
          Share (or share of such  other  capital  stock) as was  issuable  upon
          exercise of a Right  immediately  prior to the occurrence of the event
          described in clauses (A)-(D) of this Section  11(a)(i),  multiplied by
          the Adjustment Fraction;  provided,  however, that, no such adjustment
          shall be made  pursuant  to this  Section  11(a)(i) to the extent that
          there shall have simultaneously  occurred an event described in clause
          (A), (B), (C) or (D) of Section 11(n) with a proportionate  adjustment
          being made  thereunder.  Each share of Common  Stock that shall become
          outstanding after an adjustment has been made pursuant to this Section
          11(a)(i)  shall  have   associated  with  it  the  number  of  Rights,
          exercisable   at  the   Exercise   Price   and  for  the   number   of
          one-thousandths  of a Preferred Share (or shares of such other capital
          stock) as one share of Common Stock has associated with it immediately
          following the adjustment made pursuant to this Section 11(a)(i).

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

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

          (b) In case the  Company  shall,  at any time  after  the date of this
Agreement,  fix a record date for the issuance of rights, options or warrants to
all holders of Preferred  Shares  entitling such holders (for a period  expiring
within forty-five (45) calendar days after such record date) to subscribe for or
purchase  Preferred Shares or Equivalent  Shares or securities  convertible into
Preferred  Shares  or  Equivalent  Shares  at a price  per  share  (or  having a
conversion  price per share, if a security  convertible into Preferred Shares or
Equivalent  Shares)  less than the then  Current Per Share  Market  Price of the
Preferred  Shares or Equivalent  Shares on such record date,  then, in each such
case,  the  Exercise  Price to be in effect  after  such  record  date  shall be
determined by multiplying the Exercise Price in effect immediately prior to such
record  date by a  fraction,  the  numerator  of which  shall be the  number  of
Preferred Shares and Equivalent Shares (if any) outstanding on such record date,
plus the number of Preferred  Shares or Equivalent  Shares,  as the case may be,
which the aggregate  offering  price of the total number of Preferred  Shares or
Equivalent  Shares,  as the case may be, to be  offered  or issued  (and/or  the
aggregate initial  conversion price of the convertible  securities to be offered
or issued) would purchase at such current market price,  and the  denominator of
which shall be the number of  Preferred  Shares and  Equivalent  Shares (if any)
outstanding on such record date, plus the number of additional  Preferred Shares
or  Equivalent  Shares,  as the case may be, to be offered for  subscription  or
purchase  (or  into  which  the  convertible  securities  so to be  offered  are
initially  convertible);   provided,   however,  that  in  no  event  shall  the
consideration  to be paid  upon  the  exercise  of one  Right  be less  than the
aggregate par value of the shares of capital stock of the Company  issuable upon
exercise  of one  Right.  In  case  such  subscription  price  may be  paid in a
consideration part or all of which shall be in a form other than cash, the value
of such  consideration  shall be as  determined  in good faith by the  Company's
Board of Directors,  whose determination shall be described in a statement filed
with the Rights  Agent and shall be binding on the Rights  Agent and the holders
of the Rights.  Preferred Shares and Equivalent  Shares owned by or held for the
account of the Company  shall not be deemed  outstanding  for the purpose of any
such  computation.  Such adjustment shall be made  successively  whenever such a
record date is fixed, and in the event that such rights, options or warrants are
not so issued,  the Exercise  Price shall be adjusted to be the  Exercise  Price
which would then be in effect if such record date had not been fixed.

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

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

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

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

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

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

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

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

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

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

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

          (n) In the event the Company  shall at any time after the date of this
Agreement (A) declare a dividend on the Common Stock payable in shares of Common
Stock,  (B) subdivide the  outstanding  shares of Common Stock,  (C) combine the
outstanding  Common Stock (by reverse stock split or  otherwise)  into a smaller
number of shares of Common  Stock,  or (D) issue any shares of its capital stock
in a  reclassification  of the  shares  of  Common  Stock  (including  any  such
reclassification  in  connection  with a  consolidation  or  merger in which the
Company is the continuing or surviving  corporation),  then, in each such event,
except as otherwise  provided in this Section 11(a) and Section 7(e) hereof: (1)
each  share  of  Common  Stock  (or  shares  of  capital  stock  issued  in such
reclassification  of the Common Stock)  outstanding  immediately  following such
time shall have  associated with it the number of Rights as were associated with
one share of  Common  Stock  immediately  prior to the  occurrence  of the event
described in clauses (A)-(D) above; (2) the Exercise Price in effect at the time
of  the  record  date  for  such  dividend  or of the  effective  date  of  such
subdivision,  combination  or  reclassification  shall be  adjusted  so that the
Exercise Price  thereafter  shall equal the result  obtained by multiplying  the
Exercise  Price in  effect  immediately  prior to such time by a  fraction,  the
numerator  of which  shall  be the  total  number  of  shares  of  Common  Stock
outstanding  immediately  prior to the event described in clauses (A)-(D) above,
and the denominator of which shall be the total number of shares of Common Stock
outstanding  immediately after such event;  provided,  however, that in no event
shall the  consideration  to be paid upon the exercise of one Right be less than
the aggregate  par value of the shares of capital stock of the Company  issuable
upon  exercise  of such  Right;  and  (3) the  number  of  one-thousandths  of a
Preferred  Share (or  shares of such  other  capital  stock)  issuable  upon the
exercise  of each Right  outstanding  after such event shall equal the number of
one- thousandths of a Preferred Share (or shares of such other capital stock) as
were issuable with respect to one Right  immediately  prior to such event.  Each
share of Common Stock that shall become outstanding after an adjustment has been
made pursuant to this Section 11(n) shall have  associated with it the number of
Rights,  exercisable at the Exercise Price and for the number of one-thousandths
of a  Preferred  Share (or shares of such other  capital  stock) as one share of
Common Stock has associated  with it immediately  following the adjustment  made
pursuant to this  Section  11(n).  If an event  occurs  which  would  require an
adjustment  under both this  Section  11(n) and Section  11(a)(ii)  hereof,  the
adjustment provided for in this Section 11(n) shall be in addition to, and shall
be made prior to, any adjustment required pursuant to Section 11(a)(ii) hereof.

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

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

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

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

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

          (iii) the Company shall sell or otherwise  transfer (or one or more of
          its  Subsidiaries  shall sell or otherwise  transfer),  in one or more
          transactions,  assets or earning power  aggregating 50% or more of the
          assets or earning power of the Company and its Subsidiaries  (taken as
          a whole) to any other Person or Persons (other than the Company or one
          or more of its wholly owned  Subsidiaries in one or more transactions,
          each of which  individually (and together) complies with Section 11(m)
          hereof),

          then, concurrent with and in each such case:

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

     14.  Fractional Rights and Fractional Shares.

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

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

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

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

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

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

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

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

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

     17. Rights Certificate Holder Not Deemed a Stockholder. No holder, as such,
of any Rights  Certificate  shall be entitled to vote,  receive  dividends or be
deemed for any  purpose to be the  holder of the  Preferred  Shares or any other
securities  of the Company  which may at any time be issuable on the exercise of
the Rights  represented  thereby,  nor shall anything contained herein or in any
Rights  Certificate  be  construed  to  confer  upon the  holder  of any  Rights
Certificate,  as such,  any of the rights of a stockholder of the Company or any
right to vote for the  election of  directors  or upon any matter  submitted  to
stockholders  at any  meeting  thereof,  or to give or  withhold  consent to any
corporate  action,  or to receive notice of meetings or other actions  affecting
stockholders  (except as provided in Section 25 hereof), or to receive dividends
or subscription  rights,  or otherwise,  until the Right or Rights  evidenced by
such  Rights  Certificate  shall  have been  exercised  in  accordance  with the
provisions hereof.

     18.  The Rights Agent.

          (a)  The  Company  agrees  to  pay  to  the  Rights  Agent  reasonable
compensation  for all services  rendered by it hereunder and, from time to time,
on demand of the Rights  Agent,  its  reasonable  expenses  and counsel fees and
other  disbursements  incurred  in the  administration  and  execution  of  this
Agreement and the exercise and performance of its duties hereunder.  The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless  against,
any loss,  liability  or  expense,  incurred  without  negligence,  bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
by the Rights Agent in connection with the acceptance and administration of this
Agreement,  including  the costs and expenses of defending  against any claim of
liability  in the  premises.  In no event  will the  Rights  Agent be liable for
special,  indirect,  incidental  or  consequential  loss or  damage  of any kind
whatsoever, even if the Rights Agent has been advised of the possibility of such
loss or damage.

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

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

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

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

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

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

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

          (e) The Rights Agent shall not be under any  responsibility in respect
of the validity of this  Agreement or the execution and delivery  hereof (except
the due  execution  hereof by the Rights Agent) or in respect of the validity or
execution of any Rights Certificate (except its countersignature  thereof);  nor
shall it be  responsible  for any  breach  by the  Company  of any  covenant  or
condition contained in this Agreement or in any Rights Certificate; nor shall it
be  responsible  for any  change  in the  exercisability  of the  Rights  or any
adjustment in the terms of the Rights  (including  the manner,  method or amount
thereof)  provided for in Sections 3, 11, 13, 23 or 24, or the  ascertaining  of
the existence of facts that would require any such change or adjustment  (except
with respect to the exercise of Rights  evidenced by Rights  Certificates  after
receipt by the Rights Agent of a  certificate  furnished  pursuant to Section 12
describing  such change or  adjustment);  nor shall it by any act  hereunder  be
deemed  to make  any  representation  or  warranty  as to the  authorization  or
reservation of any Preferred  Shares to be issued  pursuant to this Agreement or
any Rights  Certificate or as to whether any Preferred Shares will, when issued,
be validly authorized and issued, fully paid and nonassessable.

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

          (g) The  Rights  Agent is hereby  authorized  and  directed  to accept
instructions  with respect to the  performance of its duties  hereunder from any
one of the Chairman of the Board,  the Chief Executive  Officer,  the President,
any Vice President,  the Chief Financial Officer, the Secretary or any Assistant
Secretary  of the  Company,  and  to  apply  to  such  officers  for  advice  or
instructions in connection  with its duties,  and it shall not be liable for any
action taken or suffered by it in good faith in accordance with  instructions of
any  such  officer  or  for  any  delay  in  acting  while   waiting  for  those
instructions.  Any application by the Rights Agent for written instructions from
the  Company  may, at the option of the Rights  Agent,  set forth in writing any
action  proposed  to be taken or omitted by the Rights  Agent  under this Rights
Agreement  and the date on and/or after which such action shall be taken or such
omission shall be effective. The Rights Agent shall not be liable for any action
taken by, or  omission  of,  the  Rights  Agent in  accordance  with a  proposal
included  in any  such  application  on or  after  the  date  specified  in such
application  (which date shall not be less than five (5) Business Days after the
date any officer of the Company actually receives such  application,  unless any
such officer shall have  consented in writing to an earlier date) unless,  prior
to taking any such action (or the  effective  date in the case of an  omission),
the Rights Agent shall have received  written  instructions  in response to such
application specifying the action to be taken or omitted.

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

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

          (j) No provision of this  Agreement  shall require the Rights Agent to
expend or risk its own funds or otherwise  incur any financial  liability in the
performance  of any of its duties  hereunder or in the exercise of its rights if
there shall be reasonable  grounds for believing that repayment of such funds or
adequate  indemnification  against  such  risk or  liability  is not  reasonably
assured to it.

          (k) If,  with  respect to any Rights  Certificate  surrendered  to the
Rights Agent for exercise or transfer,  the certificate  attached to the form of
assignment  or form of election to purchase,  as the case may be, has either not
been  completed  or  indicates  an  affirmative  response  to  clause 1 and/or 2
thereof, the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.

     21. Change of Rights Agent.  The Rights Agent or any successor Rights Agent
may resign and be discharged  from its duties under this  Agreement  upon thirty
(30) days' written  notice  mailed to the Company and to each transfer  agent of
the Preferred  Shares and the Common Stock by registered or certified  mail, and
to the holders of the Rights  Certificates by first-class  mail. The Company may
remove the Rights  Agent or any  successor  Rights  Agent upon thirty (30) days'
written  notice,  mailed to the Rights Agent or successor  Rights Agent,  as the
case may be, and to each transfer  agent of the Preferred  Shares and the Common
Stock  by  registered  or  certified  mail,  and to the  holders  of the  Rights
Certificates by first-class mail. If the Rights Agent shall resign or be removed
or shall  otherwise  become  incapable of acting,  the Company  shall  appoint a
successor  to  the  Rights  Agent.  If the  Company  shall  fail  to  make  such
appointment  within a period of thirty  (30) days  after  giving  notice of such
removal or after receiving  written notice of such  resignation or incapacity by
the  resigning  or  incapacitated  Rights  Agent  or by the  holder  of a Rights
Certificate (who shall, with such notice,  submit his or her Rights  Certificate
for  inspection  by the  Company),  then the  registered  holder  of any  Rights
Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent.  Any successor  Rights  Agent,  whether  appointed by the
Company or by such a court, shall be a corporation  organized and doing business
under the laws of the  United  States or of any state of the United  States,  in
good standing,  which is authorized under such laws to exercise  corporate trust
or stockholder  services  powers and is subject to supervision or examination by
federal  or state  authority  and  which has at the time of its  appointment  as
Rights  Agent a combined  capital  and surplus of at least $100  million.  After
appointment,  the  successor  Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent  without  further  act or deed;  but the  predecessor  Rights  Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder, and execute and deliver any further assurance,  conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment,  the  Company  shall  file  notice  thereof  in  writing  with  the
predecessor Rights Agent and each transfer agent of the Preferred Shares and the
Common Stock, and mail a written notice thereof to the registered holders of the
Rights Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the
resignation  or removal of the Rights Agent or the  appointment of the successor
Rights Agent, as the case may be.

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

     23.  Redemption.

          (a) The Company  may, at its option and with the approval of the Board
of  Directors,  at any time prior to the Close of Business on the earlier of (i)
the Shares  Acquisition Date and (ii) the Final Expiration Date,  redeem all but
not less than all the then outstanding Rights at a redemption price of $0.01 per
Right,  appropriately  adjusted to reflect any stock  split,  stock  dividend or
similar transaction occurring after the date hereof (such redemption price being
herein  referred  to as the  "Redemption  Price")  and the  Company  may, at its
option,  pay the Redemption Price either in shares of Common Stock (based on the
Current Per Share Market Price thereof at the time of redemption) or cash.  Such
redemption  of the Rights by the Company may be made  effective at such time, on
such  basis  and with such  conditions  as the  Board of  Directors  in its sole
discretion  may  establish.  The date on which the Board of Directors  elects to
make the redemption effective shall be referred to as the "Redemption Date".

          (b)  Immediately  upon the  action  of the Board of  Directors  of the
Company ordering the redemption of the Rights, evidence of which shall have been
filed with the Rights  Agent,  and without  any  further  action and without any
notice,  the right to  exercise  the Rights  will  terminate  and the only right
thereafter  of the holders of Rights shall be to receive the  Redemption  Price.
The Company shall promptly give public notice of any such redemption;  provided,
however,  that the failure to give or any defect in, any such  notice  shall not
affect the validity of such redemption. Within ten (10) days after the action of
the Board of Directors  ordering the redemption of the Rights, the Company shall
give notice of such  redemption  to the Rights Agent and the holders of the then
outstanding  Rights by  mailing  such  notice to all such  holders at their last
addresses as they appear upon the  registry  books of the Rights Agent or, prior
to the  Distribution  Date, on the registry  books of the transfer agent for the
Common Stock.  Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption  will state the method by which the payment of the  Redemption  Price
will be made.  Neither the Company nor any of its  Affiliates or Associates  may
redeem, acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23 or in Section 24 hereof, and
other than in  connection  with the  purchase of shares of Common Stock prior to
the Distribution Date.

     24.  Exchange.

          (a) Subject to applicable laws, rules and regulations,  and subject to
subsection 24(c) below,  the Company may, at its option,  by action of the Board
of Directors,  at any time after the occurrence of a Triggering Event,  exchange
all or part of the then  outstanding  and  exercisable  Rights  (which shall not
include  Rights that have become void pursuant to the provisions of Section 7(e)
hereof) for shares of Common  Stock at an exchange  ratio of one share of Common
Stock per Right,  appropriately  adjusted  to  reflect  any stock  split,  stock
dividend or similar  transaction  occurring after the date hereof (such exchange
ratio being hereinafter  referred to as the "Exchange  Ratio").  Notwithstanding
the  foregoing,  the Board of  Directors  shall not be  empowered to effect such
exchange at any time after any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or any such Subsidiary, or
any entity  holding Common Stock for or pursuant to the terms of any such plan),
together  with  all  Affiliates  and  Associates  of such  Person,  becomes  the
Beneficial Owner of 50% or more of the Common Stock then outstanding.

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

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

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

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

          (f) Immediately upon the action of the Board of Directors ordering the
exchange  of any Rights  pursuant  to  subsection  24(e) of this  Section 24 and
without any further  action and without any notice,  the right to exercise  such
Rights shall terminate and the only right  thereafter of a holder of such Rights
shall be to  receive  that  number of rights in  exchange  therefor  as has been
determined by the Board of Directors in accordance with subsection  24(e) above.
The Company shall give public notice of any such  exchange;  provided,  however,
that the failure to give,  or any defect in,  such  notice  shall not affect the
validity of such exchange.  The Company shall mail a notice of any such exchange
to all of the holders of such Rights at their last addresses as they appear upon
the registry  books of the transfer  agent for the shares of Common Stock of the
Company.  Any notice  which is mailed in the  manner  herein  provided  shall be
deemed given, whether or not the holder receives the notice. Each such notice of
exchange  will state the  method by which the  exchange  of the  Rights  will be
effected.

     25.  Notice of Certain Events.

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

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

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

          TOP Tankers Inc.
          109-111 Messogion Avenue
          Politia Centre
          Athens, Greece 115 26

          Attention: Stamatios Tsantanis

          with a copy to:

          Seward & Kissel LLP
          One Battery Park Plaza
          New York, New York 10004
          Attention: Gary J. Wolfe, Esq.

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

          Computershare Investor Services, LLC
          350 Indiana Street, Suite 800
          Golden, Colorado 80401

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

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

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

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

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

     31. Severability.  If any term, provision,  covenant or restriction of this
Agreement is held by a court of competent  jurisdiction or other authority to be
invalid,  void  or  unenforceable,  the  remainder  of  the  terms,  provisions,
covenants  and  restrictions  of this  Agreement  shall remain in full force and
effect  and shall in no way be  affected,  impaired  or  invalidated;  provided,
however, that notwithstanding anything in this Agreement to the contrary, if any
such term, provision, covenant or restriction is held by such court or authority
to be invalid,  void or unenforceable  and the Board of Directors of the Company
determines in its good faith  judgment  that severing the invalid  language from
this Agreement would  adversely  affect the purpose or effect of this Agreement,
the right of redemption  set forth in Section 23 hereof shall be reinstated  and
shall not expire until the Close of Business on the tenth day following the date
of such determination by the Board of Directors.

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

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

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

<PAGE>

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

                                            TOP TANKERS INC.

                                            By:
                                                 -----------------------------
                                                 Name: Evangelos J. Pistiolis
                                                 Title: President

                                            COMPUTERSHARE INVESTOR SERVICES, LLC

                                            By:
                                                 -----------------------------
                                                 Name:
                                                 Title:

<PAGE>

                                                                       Exhibit A

                     CERTIFICATE OF DESIGNATIONS OF RIGHTS,
                     PREFERENCES AND PRIVILEGES OF SERIES A
               PARTICIPATING PREFERRED STOCK OF TOP TANKERS INC.

The undersigned,  Mr. Evangelos J. Pistiolis and Mrs. Eirini  Alexandropoulou do
hereby certify:

1.  That  they  are  the  duly  elected  and  acting  President  and  Secretary,
respectively,   of  TOP  Tankers  Inc.,  a  Marshall  Islands  corporation  (the
"Company").

2. That  pursuant  to the  authority  conferred  by the  Company's  Amended  and
Restated Articles of  Incorporation,  the Company's Board of Directors on August
19, 2005  adopted the  following  resolution  designating  and  prescribing  the
relative  rights,   preferences  and  limitations  of  the  Company's  Series  A
Participating Preferred Stock:

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

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

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

     Section 3. Dividends and Distributions.

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

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

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

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

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

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

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

     Section 5. Certain Restrictions.

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

          (b) Whenever  quarterly  dividends or other dividends or distributions
payable on the Series A  Participating  Preferred Stock as provided in Section 3
are in  arrears,  thereafter  and until all  accrued  and unpaid  dividends  and
distributions,  whether  or not  declared,  on shares of Series A  Participating
Preferred Stock  outstanding shall have been paid in full, the Company shall not
(i) declare or pay dividends on, make any other  distributions  on, or redeem or
purchase or  otherwise  acquire for  consideration  any shares of stock  ranking
junior (either as to dividends or upon  liquidation,  dissolution or winding up)
to the Series A Participating Preferred Stock; (ii) declare or pay dividends on,
make any other  distributions on any shares of stock ranking on a parity (either
as to dividends or upon  liquidation,  dissolution  or winding up) with Series A
Participating  Preferred  Stock,  except  dividends paid ratably on the Series A
Participating  Preferred  Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the holders of
all such shares are then entitled; (iii) redeem or purchase or otherwise acquire
for  consideration  shares  of any  stock  ranking  on a  parity  (either  as to
dividends  or upon  liquidation,  dissolution  or winding  up) with the Series A
Participating Preferred Stock, provided that the Company may at any time redeem,
purchase or  otherwise  acquire  shares of any such parity stock in exchange for
shares of any stock of the Company  ranking  junior  (either as to  dividends or
upon  dissolution,  liquidation  or winding  up) to the  Series A  Participating
Preferred Stock; (iv) purchase or otherwise acquire for consideration any shares
of Series A Participating  Preferred  Stock, or any shares of stock ranking on a
parity with the Series A  Participating  Preferred  Stock,  except in accordance
with a purchase  offer made in writing or by  publication  (as determined by the
Board) to all  holders  of such  shares  upon  such  terms as the  Board,  after
consideration of the respective  annual dividend rates and other relative rights
and  preferences of the respective  series and classes,  shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.

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

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

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

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

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

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

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

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

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

                   REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

<PAGE>

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

     Executed in Athens, Greece on August __, 2005.

                                        --------------------------------
                                        Evangelos J. Pistiolis
                                        President and Chief Executive Officer

                                        --------------------------------
                                        Eirini Alexandropoulou
                                        Secretary

<PAGE>

                                                                       Exhibit B

                          [FORM OF RIGHTS CERTIFICATE]

<PAGE>

                                                                       Exhibit C

                                SUMMARY OF RIGHTS

Distribution and Transfer of Rights:

Distribution Date:              The rights will separate from the common
                                stock and become exercisable after (1) a
                                person or group acquires ownership of 15%
                                or more of the company's common stock or
                                (2) the 10th business day (or such later
                                date as determined by the company's board
                                of directors) after a person or group
                                announces a Preferred Stock Purchaseable
                                Upon tender or exchange offer which
                                Exercise of Rights: would result in that
                                person or group holding 15% or more of the
                                company's common stock.

Preferred Stock Purchaseable    On the Distribution Date, each holder of a
Upon Exercise of Rights:        right will be entitled to purchase for $25
                                (the "Exercise Price") a fraction
                                (1/1000th) of one share of the company's
                                preferred stock which has similar economic
                                terms as one share of common stock.

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

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

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

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

Expiration of Rights:           The rights expire on the earliest of (1)
                                August 31, 2015 or (2) the exchange or
                                redemption of the rights as described
                                above.

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

Voting Rights:                  The rights will not have any voting rights.

Anti-dilution Provisions:       The rights will have the benefit of certain
                                customary anti-dilution protections

23116.0001 #579584v2

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