Document:

Exhibit 10.31

                    Amendments to Certain Stock Option Plans
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Effective  as of  February  7, 2002,  all frozen  stock  option  plans of Thermo
Electron Corporation (the "Company") and all stock option plans of the Company's
subsidiaries  assumed by the  Company were amended as follows:

-    to clarify the language  regarding  restricted stock awards to provide that
     any  dividends  received on  restricted  stock would also be subject to the
     restrictions of the restricted stock;

-    to  delete  all  provisions  permitting  the  Company  to make a loan to an
     optionee in order to fund the  purchase of shares upon the  exercise of the
     option;

-    to provide  that  options  can only be  exercised  in  accordance  with the
     instructions established by the plan administrator;

-    to  provide  that  obligations  to pay any  federal,  state or local  taxes
     required  to be  withheld  in  accordance  with  the  plan  administrator's
     instructions;

-    amended to provide  that stock  purchased  on the  exercise of an option be
     paid for in accordance with the plan administrator's instructions;

-    to include a list of adjustments the Board may make upon recapitalizations,
     mergers  and  the  like  to  the  "adjustments  in  the  event  of  certain
     transactions" provision; and

-    to  make  the  "administration"  provision  consistent  with  that  of  the
     Company's 2001 Equity Incentive Plan, as amended.Exhibit 4.2

                                RIGHTS AGREEMENT

                          dated as of October 29, 2001

                                 by and between

                           THERMO ELECTRON CORPORATION

                                       and

                     AMERICAN STOCK TRANSFER & TRUST COMPANY

                                 as Rights Agent

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     RIGHTS AGREEMENT,  dated as of October 29, 2001 (the "Agreement"),  between
Thermo  Electron  Corporation,  a  Delaware  corporation  (the  "Company"),  and
American Stock Transfer & Trust Company, a New York corporation, as Rights Agent
(the "Rights Agent").

                               W I T N E S S E T H

WHEREAS,  on January  19,  1996,  the Board of  Directors  of the  Company  (the
"Board")  authorized and declared a dividend  distribution of one Right for each
share of Common Stock (as hereinafter defined) of the Company outstanding at the
close of business on January 29, 1996 (the "Record  Date"),  and  authorized the
issuance of one Right (as such number may  hereinafter  be adjusted  pursuant to
the  provisions  of Section  11(i) or Section  11(p)  hereof)  for each share of
Common Stock of the Company issued  between the Record Date (whether  originally
issued  or  delivered  from  the  Company's  treasury)  and the  earlier  of the
Distribution Date or the Expiration Date, each Right initially  representing the
right to purchase one ten-thousandth of a share of Series B Junior Participating
Preferred  Stock of the Company having the rights,  powers and  preferences  set
forth in the form of Certificate of  Designations  attached hereto as Exhibit A,
upon the  terms  and  subject  to the  conditions  hereinafter  set  forth  (the
"Rights");

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

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

     (a)  "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 (i) the Company, (ii) any Subsidiary of the Company,  (iii) any employee
benefit plan of the Company or of any Subsidiary of the Company, (iv) any Person
organized,  appointed or established by the Company for or pursuant to the terms
of any such plan, or (v) the Exempted Person. Notwithstanding the foregoing, (x)
no Person shall become an "Acquiring  Person" as the result of an acquisition of
Common Stock by the Company that, 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 if a Person shall become the Beneficial Owner of 15% or
more of the shares of Common Stock of the Company then outstanding as the result
of an  acquisition of Common Stock by the Company and shall,  following  written
notice from, or public  disclosure by the Company of such share purchases by the
Company  become  the  Beneficial  Owner of any  additional  Common  Stock of the
Company  and shall  then  beneficially  own 15% or more of the  shares of Common
Stock then  outstanding,  then such Person  shall be deemed to be an  "Acquiring
Person"  and (y) if the Board  determines  in good faith that a Person who would
otherwise  be an  "Acquiring  Person,"  as  defined  pursuant  to the  foregoing
provisions of this paragraph (a), has become such inadvertently, and such Person
divests as promptly as practicable  (as determined in good faith by the Board of
Directors),  but in any event  within 15  Business  Days,  following  receipt of
written  notice from the Company of such event,  of  Beneficial  Ownership  of a
sufficient  number of shares of Common Stock so that such Person would no longer
be an "Acquiring  Person," as defined  pursuant to the  foregoing  provisions of

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this  paragraph  (a),  then such Person shall not be deemed to be an  "Acquiring
Person" for any  purposes of this  Agreement  unless and until such Person shall
again become an "Acquiring Person."

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

     (c) "Affiliate" and "Associate" shall have the respective meanings ascribed
to such  terms in Rule  12b-2 of the  General  Rules and  Regulations  under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") as in effect on
the date of this Agreement.

     (d)  "Adjustment  Shares"  shall  have the  meaning  set  forth in  Section
11(a)(ii).

     (e) A Person shall be deemed the "Beneficial Owner" of, and shall be deemed
to "beneficially own," any securities:

          (i) that such Person or any of such Person's Affiliates or Associates,
     directly  or  indirectly,  owns or has 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), whether
     or not in writing,  or upon the  exercise of  conversion  rights,  exchange
     rights, other rights, warrants or options, or otherwise; provided, however,
     that a --------  ------- Person shall not be deemed the "Beneficial  Owner"
     of, or to "beneficially  own," (A) securities tendered pursuant to a tender
     or  exchange  offer  made by or on  behalf  of such  Person  or any of such
     Person's  Affiliates  or  Associates  until such  tendered  securities  are
     accepted for purchase or exchange, or (B) securities issuable upon exercise
     of Rights at any time prior to the occurrence of a Triggering Event, or (C)
     securities  issuable upon exercise of Rights from and after the  occurrence
     of a Triggering  Event which Rights were  acquired by such Person or any of
     such Person's  Affiliates or Associates prior to the  Distribution  Date or
     pursuant to Section  3(a) or Section 22 hereof (the  "Original  Rights") or
     pursuant to Section 11(i) hereof in connection with an adjustment made with
     respect to any Original Rights;

          (ii)  that  such  Person  or  any  of  such  Person's   Affiliates  or
     Associates,  directly or indirectly, has the right to vote or dispose of or
     has "beneficial  ownership" of (as determined pursuant to Rule 13d-3 of the
     General Rules and Regulations  under the Exchange Act, or any comparable or
     successor  rule),  including  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), whether or not in writing; provided, however, that
     a Person shall not -------- ------- be deemed the "Beneficial Owner" of, or
     to  "beneficially  own," any  security  under this  subparagraph  (ii) as a
     result of an agreement,  arrangement or understanding to vote such security
     if such agreement,  arrangement or understanding:  (A) arises solely from a
     revocable  proxy or consent  given in response to a public proxy or consent
     solicitation  made  pursuant to, and in  accordance  with,  the  applicable
     provisions of the General Rules and Regulations under the Exchange Act, and

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<PAGE>

     (B) is not then  reportable  by such  Person  on  Schedule  13D  under  the
     Exchange Act (or any comparable or successor report); or

          (iii) that 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  (other than customary  agreements  with and
     between  underwriters and selling group members with respect to a bona fide
     public offering of securities)  whether or not in writing,  for the purpose
     of acquiring,  holding,  voting  (except  pursuant to a revocable  proxy or
     consent as described in the proviso to subparagraph  (ii) of this paragraph
     (e)) or disposing of any voting securities of the Company.

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)(l)(i)  of the General Rules and  Regulations
under the Exchange Act.

     (f) "Board"  shall have the meaning set forth in the WHEREAS  clause at the
beginning of this Agreement.

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

     (h) "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.

     (i) "Common  Stock" shall mean the common  stock,  $1.00 par value,  of the
Company, except that "Common Stock" when used with reference to any Person other
than the Company  shall mean the capital  stock of such Person with the greatest
voting power, or the equity  securities or other equity interest having power to
control or direct the management, of such Person.

     (j) "Common stock  equivalents" shall have the meaning set forth in Section
11(a)(iii) hereof.

     (k)  "Company"  shall  have  the  meaning  set  forth  in the  introductory
paragraph hereof.

     (l)  "Current  market  price"  shall have the  meaning set forth in Section
11(d)(i) hereof.

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

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<PAGE>

     (n)  "Distribution  Date" shall have the meaning set forth in Section  3(a)
hereof.

     (o)  "Equivalent  Preferred  Stock"  shall  have the  meaning  set forth in
Section 11(b) hereof.

     (p) "Exchange Act" shall have the meaning set forth in Section 1(c) hereof.

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

     (r)  "Expiration  Date" shall have the  meaning  set forth in Section  7(a)
hereof.

     (s) "Final Expiration Date" shall mean the close of business on January 29,
2006.

     (t)  "Permitted  Offer" shall mean a tender offer or an exchange  offer for
all outstanding shares of Common Stock at a price and on terms determined, prior
to the  consummation  of such  tender  offer or  exchange  offer,  by  directors
constituting  at least 75% of all of the members of the Board,  after  receiving
advice from a nationally  recognized  investment  banking  firm  selected by the
Board,  to be (a) at a price that is fair to  stockholders  (taking into account
all factors  that such  members of the Board deem  relevant  including,  without
limitation,  prices  that could  reasonably  be  achieved  if the Company or its
assets were sold on an orderly basis designed to realize  maximum value) and (b)
otherwise in the best interests of the Company and its stockholders.

     (u) "Person" shall mean any  individual,  firm,  corporation,  partnership,
trust, association, limited liability company or other entity.

     (v)  "Preferred  Stock" shall mean shares of Series B Junior  Participating
Preferred  Stock,  $100  par  value,  of  the  Company  having  the  rights  and
preferences  set forth in the form of  Certificate of  Designations  attached to
this  Agreement  as Exhibit A and, to the extent that there is not a  sufficient
number of shares of Series B Junior Participating  Preferred Stock authorized to
permit the full  exercise of the Rights,  any other series of  Preferred  Stock,
$100 par value,  of the Company  designated  for such purpose  containing  terms
substantially  similar  to  the  terms  of the  Series  B  Junior  Participating
Preferred Stock.

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

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

     (y) "Record Date" shall have the meaning set forth in the WHEREAS clause at
the beginning of this Agreement.

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

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

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     (bb) "Rights" shall have the meaning set forth in the WHEREAS clause at the
beginning of this Agreement.

     (cc) "Rights  Agent"  shall have the meaning set forth in the  introductory
paragraph hereof.

     (dd) "Rights Certificates" shall have the meaning set forth in Section 3(a)
hereof.

     (ee) "Section  11(a)(ii)  Event" shall mean an  acquisition of Common Stock
described in the first sentence of Section 11(a)(ii) hereof.

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

     (gg) Section 13 Event"  shall mean any event  described in clauses (x), (y)
or (z) of Section 13(a) hereof.

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

     (ii)  "Stock  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,  however, that, if such Person is deemed not to be an Acquiring Person
pursuant to clause (y) of Section 1(a) hereof,  no Stock  Acquisition Date shall
be deemed to have occurred.

     (jj) "Subsidiary" shall mean, with reference to any Person, any corporation
or other entity of which an amount of voting  securities  sufficient to elect at
least a majority of the directors (or  comparable  body) of such  corporation or
other entity is beneficially owned,  directly or indirectly,  by such Person, or
otherwise controlled by such Person.

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

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

     (mm)  "Triggering  Event"  shall mean any  Section  11(a)(ii)  Event or any

Section 13 Event.

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

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Section 3.        Issuance of Rights.

     (a) Until the earlier of (i) the close of  business  on the tenth  Business
Day after the Stock  Acquisition  Date (or, if the tenth  Business Day after the
Stock  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 Board) 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  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 of the  General  Rules and  Regulations
under the Exchange Act, if upon consummation  thereof,  such Person would be the
Beneficial Owner of 15% or more of the shares of Common Stock then  outstanding,
in either  instance other than pursuant to a Permitted Offer (the earlier of (i)
and (ii) being herein referred to as the  "Distribution  Date"),  (x) the Rights
will be evidenced by the  certificates  for the Common Stock  registered  in the
names of the holders of the Common  Stock (which  certificates  for Common Stock
shall  be  deemed  also to be  certificates  for  Rights)  and  not by  separate
certificates,  and (y) the Rights will be  transferable  only in connection with
the transfer of the underlying  shares of Common Stock  (including a transfer to
the Company).  As soon as practicable  after the  Distribution  Date, the Rights
Agent will send by  first-class,  insured,  postage prepaid mail, to each record
holder of the 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,  one or more
rights certificates,  in substantially the form of Exhibit B hereto (the "Rights
Certificates"),  evidencing  one Right for each  share of Common  Stock so held,
subject to adjustment as provided  herein.  With respect to certificates for the
Common Stock  outstanding as of the close of business on the Record Date,  until
the Distribution Date, the Rights will be evidenced by such certificates for the
Common  Stock and the  registered  holders of the Common Stock shall also be the
registered holders of the associated Rights. 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 (i) shall, with
respect to shares of Common Stock so issued or sold  pursuant to the exercise of
stock  options or under any employee  benefit plan or  arrangement,  or upon the
exercise,  conversion or exchange of securities granted or issued by the Company
prior to the  Distribution  Date,  and (ii) may,  in any other  case,  if deemed
necessary or appropriate by the Board,  issue Rights  Certificates  representing
the  appropriate  number of Rights in  connection  with such  issuance  or sale;
provided,  however,  that (x) no such Rights Certificate shall be issued if, and
to the extent that,  the Company  shall be advised by counsel that such issuance
would create a  significant  risk of material  adverse tax  consequences  to the
Company or the Person to whom such Rights  Certificate would be issued,  and (y)
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.  In the event that an  adjustment  in the number of Rights per share of
Common Stock has been made pursuant to Sections  11(i) or 11(p)  hereof,  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 and
after the Distribution  Date, the Rights will be evidenced solely by such Rights
Certificates.

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<PAGE>

     (b) As promptly as practicable  following the Record Date, the Company will
send a copy of a Summary of Rights to Purchase Preferred Stock, in substantially
the form attached hereto as Exhibit C, by first-class,  postage-prepaid mail, to
each record holder of the 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.  The
failure  to  send  a copy  of  the  Summary  of  Rights  shall  not  affect  the
enforceability  of any part of this Rights Agreement or the rights of any holder
of the Rights.

     (c) Rights  shall be issued  (i) in  respect of all shares of Common  Stock
that are issued (either as an original issuance or from the Company's  treasury)
after the Record Date but prior to the earlier of the  Distribution  Date or the
Expiration  Date and (ii) 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 (x) with respect to shares of Common Stock so issued or
sold  pursuant to the exercise of stock  options or under any  employee  benefit
plan or arrangement, or upon the exercise, conversion or exchange of securities,
granted or issued by the  Company  prior to the  Distribution  Date and (y) with
respect to shares of Common Stock so issued or sold in any other case, if deemed
necessary or appropriate by the Board.  Certificates representing such shares of
Common Stock (including,  without limitation,  certificates issued upon transfer
or exchange 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 the  Rights  Agreement  between
               Thermo  Electron  Corporation  (the "Company") and American Stock
               Transfer & Trust Company (the "Rights  Agent") as such  Agreement
               may be amended  from time to time (the "Rights  Agreement"),  the
               terms of which are hereby  incorporated herein by reference and a
               copy of which is on file at the principal offices of the Company.
               Under  certain   circumstances,   as  set  forth  in  the  Rights
               Agreement, such Rights will be evidenced by separate certificates
               and will no longer be evidenced by this certificate.  The Company
               will mail to the holder of this  Certificate a copy of the Rights
               Agreement,  as in effect on the date of mailing,  without  charge
               promptly  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 and (ii) the Expiration  Date, the Rights
associated  with the Common  Stock  represented  by such  certificates  shall be
evidenced  by such  certificates  alone and  registered  holders of Common Stock
shall also be the registered holders of the associated  Rights.  Notwithstanding
this Section 3(c), the omission of a legend shall not affect the  enforceability
of any part of this Rights Agreement or the rights of any holder of the Rights.

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     (d) Until the earlier of the Distribution Date and the Expiration Date, the
transfer of any certificates  representing  shares of Common Stock in respect of
which Rights have been issued shall also  constitute  the transfer of the Rights
associated  with such  shares of Common  Stock.  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  cancelled and retired so that the Company shall not be entitled
to exercise  any Rights  associated  with the shares of Common Stock that are no
longer outstanding.

Section 4.        Form of Rights Certificates.

     (a) The  Rights  Certificates  (and the  forms  of  election  to  purchase,
certification and assignment to be printed on the reverse thereof) shall each be
substantially  in the form set forth in 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 over-the-counter market on which the
Rights may from time to time be listed,  or to conform to usage.  Subject to the
provisions of Sections 7, 11 and 22 hereof,  the Rights  Certificates,  whenever
distributed,  shall  entitle the holders  thereof to purchase such number of one
ten-thousandths  of a share of Preferred  Stock as shall be set forth therein at
the price set forth therein (such  exercise  price per one  ten-thousandth  of a
share, the "Purchase Price"), but the amount and type of securities  purchasable
upon the exercise of each Right and the Purchase  Price thereof shall be subject
to adjustment as provided herein.

     (b) Any Rights  Certificate  issued pursuant to Section 3, Section 11(i) or
Section 22 hereof that represents Rights  beneficially owned by persons known to
be: (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, 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  (whether or not in writing)
regarding the transferred Rights or (B) a transfer that the Board has determined
is part of a plan, arrangement or understanding (whether or not in writing) that
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

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<PAGE>

                    Rights  represented  hereby may become  null and void in the
                    circumstances specified in Section 7(e) of such Agreement.

The  provisions  of Section 7(e) hereof  shall be  operative  whether or not the
foregoing legend is contained on any such Rights Certificate.

Section 5.        Countersignature and Registration.

     (a) The Rights  Certificates  shall be executed on behalf of the Company by
its Chairman of the Board,  President or any Vice President,  either manually or
by facsimile  signature,  and shall have affixed thereto the Company's seal or a
facsimile  thereof,  which shall be attested by the  Secretary  or an  Assistant
Secretary of the Company, either manually or by facsimile signature.  The Rights
Certificates  shall be manually  countersigned by the Rights Agent and shall not
be valid for any  purpose  unless so  countersigned.  In case any officer of the
Company who shall have signed any of the 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  had not ceased to be such officer of the  Company;  and any Rights
Certificates  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 shall keep or cause
to be kept, at its office  designated as the appropriate  place for surrender of
Rights  Certificates  upon  exercise or  transfer,  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,  the
Rights Certificate number and the date of each of the Rights Certificates.

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

     (a) Subject to the provisions of Section 4(b),  Section 7(e) and Section 14
hereof, at any time after the close of business on the Distribution Date, and at
or prior to the close of business on the Expiration Date, any Rights Certificate
or Certificates  (other than Rights  Certificates  representing Rights that have
become void pursuant to Section 7(e) hereof or that have been exchanged pursuant
to Section 24 hereof) may be  transferred,  split up,  combined or exchanged for
another Rights  Certificate or Certificates,  entitling the registered holder to
purchase a like number of one ten-thousandths of a share of Preferred Stock (or,
following a Triggering  Event,  Common Stock,  other  securities,  cash or other
assets,  as  the  case  may  be)  as  the  Rights  Certificate  or  Certificates
surrendered  then  entitled  such  holder  (or  former  holder  in the case of a
transfer) to purchase.  Any registered  holder  desiring to transfer,  split up,
combine or  exchange  any Rights  Certificate  or  Certificates  shall make such
request in writing delivered to the Rights Agent, and shall surrender the Rights
Certificate or Certificates to be transferred,  split up, combined or exchanged,
with the form of  assignment  and  certificate  appropriately  executed,  at the

                                       9
<PAGE>

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 Section
4(b), Section 7(e) and Section 14 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 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 execute and deliver a new Rights Certificate of like
tenor to the Rights Agent for countersignature and delivery to the registered
owner in lieu of the Rights Certificate so lost, stolen, destroyed or mutilated.

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

     (a) Subject to Section 7(e)  hereof,  the  registered  holder of any Rights
Certificate  may  exercise  the Rights  evidenced  thereby  (except as otherwise
provided   herein   including,   without   limitation,   the   restrictions   on
exercisability  set forth in Section  9(c),  Section  11(a)(iii)  and Section 23
hereof)  in  whole or in part at any  time  after  the  Distribution  Date  upon
surrender of the Rights  Certificate,  with the form of election to purchase and
the  certificate 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 aggregate  Purchase Price with respect to the total number of one
ten-thousandths of a share of Preferred Stock (or other shares, securities, cash
or other  assets,  as the case may be) as to which such  surrendered  Rights are
then exercisable,  at or prior to the earliest of (i) the Final Expiration Date,
(ii) the time at which the Rights  expire as provided in Section  13(d)  hereof,
(iii) the time at which the Rights are redeemed as provided in Section 23 hereof
(the "Redemption  Date") and (iv) the time at which such Rights are exchanged as
provided in Section 24 hereof (the earliest of (i),  (ii),  (iii) and (iv) being
herein referred to as the "Expiration Date").

     (b) The Purchase Price for each one  ten-thousandth of a share of Preferred
Stock  pursuant to the exercise of a Right shall  initially be $250.00 and shall
be subject to adjustment  from time to time as provided in Sections 11 and 13(a)
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  and the  certificate  duly  executed,
accompanied by payment, with respect to each Right so exercised, of the Purchase
Price per one  ten-thousandth  of a share of Preferred  Stock (or other  shares,
securities,  cash or other  assets,  as the case may be) to be purchased  and an

                                       10
<PAGE>

amount equal to any applicable transfer tax, the Rights Agent shall,  subject to
Section 20(k) hereof,  thereupon  promptly (i) (A) requisition from any transfer
agent of the shares of Preferred Stock (or make  available,  if the Rights Agent
is the transfer agent for such shares)  certificates for the total number of one
ten-thousandths  of a share of Preferred  Stock to be purchased  and the Company
hereby authorizes its transfer agent to comply with such requests, or (B) if the
Company  shall have  elected to deposit the total  number of shares of Preferred
Stock issuable upon exercise of the Rights  hereunder  with a depositary  agent,
requisition  from the depositary  agent depositary  receipts  representing  such
number  of one  ten-thousandths  of a  share  of  Preferred  Stock  as are to be
purchased  (in  which  case  certificates  for the  shares  of  Preferred  Stock
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  requests,  (ii)  requisition  from the Company the amount of cash, if
any,  to be paid in lieu 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) after receipt  thereof,  deliver such cash, if any, to or
upon the order of the registered holder of such Rights Certificate.  The payment
of the  Purchase  Price (as such  amount  may be  reduced  pursuant  to  Section
11(a)(iii) hereof) may be made in cash or by certified bank check or money order
payable to the order of the Company.  In the event that the Company is obligated
to issue other  securities  (including  Common  Stock) of the Company,  pay cash
and/or distribute other property  pursuant to Section 11(a) hereof,  the Company
shall 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 and  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, 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 Section 11(a)(ii) 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, 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 the
Acquiring  Person has any continuing  agreement,  arrangement  or  understanding
(whether or not in writing)  regarding the transferred  Rights or (B) a transfer
that the Board has determined is part of a plan,  arrangement  or  understanding
(whether or not in writing) that has as a primary purpose or effect avoidance of
this Section 7(e),  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.  No Rights
Certificate  shall be issued at any time upon the  transfer  of any Rights to an
Acquiring  Person whose Rights would be void pursuant to the preceding  sentence
or any  Associate  or  Affiliate  thereof or to any  nominee  of such  Acquiring

                                       11
<PAGE>

Person,  Associate or  Affiliate;  and any Rights  Certificate  delivered to the
Rights  Agent for  transfer to an  Acquiring  Person  whose Rights would be void
pursuant to the preceding sentence shall be cancelled. The Company shall use all
reasonable  efforts  to insure  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 other  Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its 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  transfer or
exercise as set forth in this Section 7 unless such registered holder shall have
(i)  completed  and signed the  certificate  following the form of assignment or
election to purchase  set forth on the  reverse  side of the Rights  Certificate
surrendered for such  assignment or exercise,  and (ii) provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
any Affiliates or Associates thereof as the Company shall reasonably request.

Section 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 any of its
agents,  be delivered to the Rights Agent for cancellation or in cancelled form,
or, if surrendered to the Rights Agent,  shall be cancelled 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 other  Rights  Certificate  purchased  or  acquired  by the Company
otherwise  than upon the exercise  thereof.  The Rights Agent shall  deliver all
cancelled Rights  Certificates to the Company,  or shall, at the written request
of the Company,  destroy such cancelled  Rights  Certificates,  and in such case
shall deliver a certificate of destruction thereof to the Company.

Section 9.        Reservation and Availability of Capital Stock.

     (a) The Company  covenants and agrees that it will cause to be reserved and
kept  available out of its  authorized  and unissued  shares of Preferred  Stock
(and,  following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out of its authorized
and issued shares held in its treasury), the number of shares of Preferred Stock
(and,  following the occurrence of a Triggering Event, Common Stock and/or other
securities)  that, as provided in this Agreement  including  Section  11(a)(iii)
hereof,  will be  sufficient  to permit the exercise in full of all  outstanding
Rights.

     (b) So long as the shares of Preferred Stock (and, following the occurrence
of a Section 11(a)(ii) Event, Common Stock and/or other securities) issuable and
deliverable  upon the  exercise  of the  Rights  may be listed  on any  national
securities  exchange or automated  quotation  system,  the Company shall use its
best  efforts  to  cause,  from  and  after  such  time  as  the  Rights  become
exercisable, all shares reserved for such issuance to be so listed 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 Section
11(a)(ii) Event on which the  consideration  to be delivered by the Company upon

                                       12
<PAGE>

exercise of the Rights has been determined in accordance with 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 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,  (iii) cause such registration  statement to remain effective
(with a prospectus at all times meeting the  requirements  of the Act) until the
earlier  of (A) the date as of which the Rights  are no longer  exercisable  for
such  securities,  and (B) the Expiration  Date, and (iv) obtain such regulatory
approvals as may be necessary for it to issue  securities  purchasable  upon the
exercise  of the  Rights.  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.
The Company may temporarily  suspend, for a period of time not to exceed 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 or to obtain any other
required  regulatory  approval  in  connection  with the  exercisability  of the
Rights. Upon 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.  Notwithstanding  any provision of this  Agreement to the contrary,  the
Rights  shall  not be  exercisable  in any  jurisdiction  unless  the  requisite
registration or qualification in such  jurisdiction  shall have been effected or
obtained.

     (d) The Company  covenants  and agrees that it will take all such action as
may be necessary to ensure that all one  ten-thousandths of a share of Preferred
Stock (and,  following the occurrence of a Triggering Event, Common Stock and/or
other  securities)  delivered  upon  exercise  of Rights  shall,  at the time of
delivery of the certificates for such shares (subject to payment of the Purchase
Price),  be  duly  and  validly   authorized  and  issued  and  fully  paid  and
nonassessable.

     (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  that may be
payable in respect of the issuance or delivery of the Rights Certificates and of
any  certificates  for a number of one  ten-thousandths  of a share of Preferred
Stock (or Common  Stock and/or  other  securities,  as the case may be) upon the
exercise of Rights.  The Company shall not, however,  be required (i) to pay any
transfer  tax that may be  payable in respect of any  transfer  or  delivery  of
Rights  Certificates  to a Person  other than,  or the issuance or delivery of a
number of one  ten-thousandths  of a share of  Preferred  Stock (or Common Stock
and/or  other  securities,  as the case may be) in  respect of a name other than
that of, the  registered  holder of the  Rights  Certificate  evidencing  Rights
surrendered  for  exercise  or (ii) to issue or deliver any  certificates  for a
number of one  ten-thousandths  of a share of  Preferred  Stock (or Common Stock
and/or  other  securities,  as the case may be) in a name other than that of the
registered holder upon the exercise of any Rights until 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.

Section  10.  Preferred  Stock  Record  Date.  Each  Person  in  whose  name any
certificate  for a number of one  ten-thousandths  of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may be) is issued upon the

                                       13
<PAGE>

exercise of Rights shall for all purposes be deemed to have become the holder of
record of such  fractional  shares of  Preferred  Stock (or Common  Stock and/or
other  securities,  as the  case  may  be)  represented  thereby  on,  and  such
certificate  shall  be  dated,  the  date  upon  which  the  Rights  Certificate
evidencing  such  Rights was duly  surrendered  with the forms of  election  and
certification  duly  executed  and  payment  of  the  Purchase  Price  (and  all
applicable transfer taxes) was made; provided, however, that if the date of such
surrender and payment is a date upon which the Preferred  Stock (or Common Stock
and/or other  securities,  as the case may be) transfer books of the Company are
closed,  such Person  shall be deemed to have  become the record  holder of such
shares  (fractional or otherwise) on, and such  certificate  shall be dated, the
next  succeeding  Business  Day on which the  Preferred  Stock (or Common  Stock
and/or other  securities,  as the case may be) transfer books of the Company are
open.  Prior to the exercise of the Rights  evidenced  thereby,  the holder of a
Rights  Certificate,  as  such,  shall  not  be  entitled  to  any  rights  of a
stockholder of the Company with respect to securities for which the Rights shall
be exercisable,  including,  without  limitation,  the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company,  except
as provided herein.

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

          (a) (i) In the event the  Company  shall at any time after the date of
          this  Agreement (A) declare a dividend on the Preferred  Stock payable
          in shares of Preferred Stock, (B) subdivide the outstanding  Preferred
          Stock,  (C) combine  the  outstanding  Preferred  Stock into a smaller
          number of shares,  or (D) issue any shares of its  capital  stock in a
          reclassification   of  the  Preferred   Stock   (including   any  such
          reclassification in connection with a consolidation or merger in which
          the Company is the  continuing  or surviving  corporation),  except as
          otherwise  provided in this Section 11(a) and Section 7(e) hereof, the
          Purchase  Price  in  effect  at the time of the  record  date for such
          dividend or of the effective date of such subdivision,  combination or
          reclassification, and the number and kind of shares of Preferred Stock
          or capital stock, as the case may be, issuable on such date,  shall be
          proportionately  adjusted  so that the  holder of any Right  exercised
          after such time shall be  entitled  to  receive,  upon  payment of the
          Purchase Price then in effect, the aggregate number and kind of shares
          of Preferred Stock or capital stock, as the case may be, that, if such
          Right had been exercised  immediately prior to such date and at a time
          when the Preferred  Stock  transfer books of the Company were open, he
          would have owned upon such  exercise  and been  entitled to receive by
          virtue of such dividend, subdivision, combination or reclassification.
          If an event occurs that would  require an  adjustment  under both this
          Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided
          for in this  Section  11(a)(i)  shall be in addition  to, and shall be
          made prior to, any adjustment  required  pursuant to Section 11(a)(ii)
          hereof.

                                       14
<PAGE>

               (ii) Subject to Section 24 of this  Agreement,  in the event that
          any  Person,  alone or together  with its  Affiliates  or  Associates,
          becomes an  Acquiring  Person  (other  than  pursuant  to a  Permitted
          Offer),  then,  promptly following the first occurrence of such event,
          proper  provision shall be made so that each holder of a Right (except
          as provided  below and in Section 7(e) hereof) shall  thereafter  have
          the right to receive  (subject to the last sentence of Section 23(a)),
          upon exercise thereof at the then current Purchase Price in accordance
          with  the  terms  of  this  Agreement,  in  lieu  of a  number  of one
          ten-thousandths  of a share of Preferred Stock,  such number of shares
          of Common Stock of the Company that equals the result  obtained by (x)
          multiplying the then current  Purchase Price by the then number of one
          ten-thousandths  of a share of  Preferred  Stock for which a Right was
          exercisable  immediately  prior to the first  occurrence  of a Section
          11(a)(ii) Event, and (y) dividing that product (which,  following such
          first  occurrence,  shall  thereafter  be referred to as the "Purchase
          Price" for each Right and for all purposes of this  Agreement)  by 50%
          of the current  market  price  (determined  pursuant to Section  11(d)
          hereof) per share of Common Stock on the date of such first occurrence
          (such number of shares, the "Adjustment Shares").

               (iii) In the event that the number of shares of Common Stock that
          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 in accordance with the foregoing  subparagraph (ii)
          of this Section 11(a),  the Company shall: (A) determine the excess of
          (1) the value of the Adjustment Shares issuable upon the exercise of a
          Right (the "Current  Value") over (2) the Purchase Price (such excess,
          the  "Spread"),  and (B) with  respect to each  Right,  make  adequate
          provision to substitute for the Adjustment Shares, upon payment of the
          applicable  Purchase Price,  (1) cash, (2) a reduction in the Purchase
          Price,  (3) Common  Stock or other  equity  securities  of the Company
          (including,  without  limitation,  shares,  or  units  of  shares,  of
          preferred  stock  that the Board has  deemed to have the same value as
          shares of Common Stock (such shares of preferred stock,  "common stock
          equivalents")),  (4) debt securities of the Company, (5) other assets,
          or (6) any  combination  of the foregoing,  having an aggregate  value
          equal to the  Current  Value,  where  such  aggregate  value  has been
          determined  by  the  Board  based  upon  the  advice  of a  nationally
          recognized  investment  banking firm selected by the Board;  provided,
          however,  if the Company  shall not have made  adequate  provision  to
          deliver  value  pursuant to clause (B) above within 30 days  following
          the later of (x) the first occurrence of a Section 11(a)(ii) Event and

                                       15
<PAGE>

          (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 Purchase Price,  shares of
          Common Stock (to the extent  available) and then, if necessary,  cash,
          which shares and/or cash have an aggregate  value equal to the Spread.
          If the Board  shall  determine  in good faith  that it is likely  that
          sufficient  additional  shares of Common Stock could be authorized for
          issuance  upon  exercise in full of the Rights,  the 30 day period set
          forth above may be extended to the extent necessary, but not more than
          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  (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  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  market price (as  determined
          pursuant to Section 11(d) hereof) per share 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 fix a record date for the issuance of rights,
options  or  warrants  to all  holders  of  Preferred  Stock  entitling  them to
subscribe for or purchase (for a period  expiring  within 45 calendar days after
such record date) Preferred Stock (or shares having the same rights,  privileges
and preferences as the shares of Preferred Stock ("equivalent preferred stock"))
or securities  convertible into Preferred Stock or equivalent preferred stock at
a price per share of Preferred Stock or per share of equivalent  preferred stock
(or  having a  conversion  price  per  share,  if a  security  convertible  into
Preferred  Stock or  equivalent  preferred  stock) less than the current  market
price (as  determined  pursuant to Section  11(d) hereof) per share of Preferred
Stock on such record date,  the Purchase Price to be in effect after such record
date shall be determined by multiplying the Purchase Price in effect immediately
prior to such  record date by a fraction,  the  numerator  of which shall be the
number of shares of Preferred  Stock  outstanding on such record date,  plus the
number of shares of Preferred  Stock that the  aggregate  offering  price of the
total number of shares of Preferred Stock and/or  equivalent  preferred stock so
to be offered (and/or the aggregate initial  conversion price of the convertible
securities so to be offered) would  purchase at such current  market price,  and
the  denominator  of which  shall be the  number of shares  of  Preferred  Stock
outstanding  on such  record  date,  plus the  number  of  additional  shares of
Preferred Stock and/or equivalent preferred stock to be offered for subscription
or  purchase  (or into which the  convertible  securities  so to be offered  are
initially convertible).  In case such subscription price may be paid by delivery
of  consideration  part or all of which may be in a form other  than  cash,  the
value of such  consideration  shall be as determined in good faith by the Board,
whose  determination  shall be  described  in a statement  filed with the Rights
Agent and shall be conclusive for all purposes.  Shares of Preferred Stock owned
by or held for the account of the Company  shall not be deemed  outstanding  for
the purpose of any such computation.  Such adjustment shall be made successively
whenever such a record date is fixed, and in the event that such rights, options
or warrants are not so issued,  the  Purchase  Price shall be adjusted to be the
Purchase  Price that would  then be in effect if such  record  date had not been
fixed.

                                       16
<PAGE>

     (c) In case the Company shall fix a record date for a  distribution  to all
holders of Preferred Stock (including any such  distribution  made in connection
with  a  consolidation  or  merger  in  which  the  Company  is  the  continuing
corporation) of evidences of indebtedness,  cash (other than a regular quarterly
cash dividend out of the earnings or retained  earnings of the Company),  assets
(other than a dividend  payable in Preferred  Stock,  but including any dividend
payable in stock other than Preferred Stock) or subscription  rights or warrants
(excluding those referred to in Section 11(b) hereof),  the Purchase Price to be
in effect after such record date shall be determined by multiplying the Purchase
Price  in  effect  immediately  prior to such  record  date by a  fraction,  the
numerator of which shall be the current market price (as determined  pursuant to
Section 11(d) hereof) per share of Preferred Stock on such record date, less the
fair market value (as determined in good faith by the Board, whose determination
shall be  described  in a  statement  filed with the  Rights  Agent and shall be
conclusive for all purposes) 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 share of Preferred  Stock and the  denominator of which shall be
such current market price (as  determined  pursuant to Section 11(d) hereof) per
share of Preferred  Stock on such record date.  Such  adjustments  shall be made
successively  whenever  such a record date is fixed,  and in the event that such
distribution  is not so made,  the  Purchase  Price  shall be adjusted to be the
Purchase  Price that would have been in effect if such  record date had not been
fixed.

               (d) (i) For the purpose of any computation hereunder,  other than
          computations made pursuant to Section  11(a)(iii) hereof, the "current
          market price" per share of Common Stock on any date shall be deemed to
          be the  average of the daily  closing  prices per share of such Common
          Stock for the 30 consecutive Trading Days (as such term is hereinafter
          defined)   immediately  prior  to  such  date,  and  for  purposes  of
          computations made pursuant to Section  11(a)(iii) hereof, the "current
          market price" per share of Common Stock on any date shall be deemed to
          be the  average of the daily  closing  prices per share of such Common
          Stock for the ten (10) consecutive Trading Days immediately  following
          such  date;  provided,  however,  that in the event  that the  current
          market  price per share of the  Common  Stock is  determined  during a
          period  following the  announcement by the issuer of such Common Stock
          of (A) a dividend  or  distribution  on such Common  Stock  payable in
          shares of such Common Stock or securities  convertible  into shares of
          such Common  Stock (other than the  Rights),  or (B) any  subdivision,
          combination or reclassification of such Common Stock, and prior to the
          expiration  of the  requisite  30 Trading Day or ten (10)  Trading Day
          period,  as set  forth  above,  after  the  ex-dividend  date for such
          dividend or  distribution,  or the record  date for such  subdivision,
          combination or reclassification  occurs,  then, and in each such case,
          the "current  market  price"  shall be properly  adjusted to take into
          account ex-dividend or post record date trading. 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  principal  national  securities
          exchange on which the shares of Common Stock are listed or admitted to
          trading  or, if the shares of Common  Stock are not listed or admitted
          to trading on any national securities exchange,  the last quoted price
          or, if not so  quoted,  the  average of the high bid and the low asked
          prices in the over-the-counter market, as reported by The Nasdaq Stock

                                       17
<PAGE>

          Market,  Inc.  ("Nasdaq")  or such other system then in use, or, if on
          any such date the  shares of Common  Stock are not  quoted by any such
          organization,  the  average  of the  closing  bid and asked  prices as
          furnished by a professional market maker making a market in the Common
          Stock selected by the Board. All references in this Section to closing
          prices,  last quoted  prices or other stock prices mean prices  during
          regular  trading hours,  without  giving effect to any  after-hours or
          extended hours trading.  If on any such date no market maker is making
          a market in the Common  Stock,  the fair value of such  shares on such
          date  shall  be as  determined  in  good  faith  by the  Board,  whose
          determination  shall be described in a statement filed with the Rights
          Agent and shall be conclusive for all purposes. The term "Trading Day"
          shall mean a day on which Nasdaq or any national  securities  exchange
          on which the shares of Common  Stock are listed or admitted to trading
          is open for the  transaction  of business  or, if the shares of Common
          Stock are not listed or admitted to trading on Nasdaq or any  national
          securities  exchange,  a  Business  Day.  If the  Common  Stock is not
          publicly held or not so listed or traded,  "current  market price" per
          share shall mean the fair value per share as  determined in good faith
          by the Board,  whose  determination  shall be described in a statement
          filed with the Rights Agent and shall be conclusive for all purposes.

               (ii) For the purpose of any computation  hereunder,  the "current
          market price" per share of Preferred  Stock shall be determined in the
          same manner as set forth  above for the Common  Stock in clause (i) of
          this Section  11(d)  (other than the last  sentence  thereof).  If the
          current market price per share of Preferred Stock cannot be determined
          in the manner provided above or if the Preferred Stock is not publicly
          held or listed or traded in a manner  described  in clause (i) of this
          Section 11(d), the "current market price" per share of Preferred Stock
          shall be conclusively  deemed to be an amount equal to 10,000 (as such
          number may be appropriately  adjusted for such events as stock splits,
          stock dividends and recapitalizations with respect to the Common Stock
          occurring after the date of this Agreement)  multiplied by the current
          market  price per share of the Common  Stock.  If  neither  the Common
          Stock nor the Preferred Stock is publicly held or so listed or traded,
          "current market price" per share of the Preferred Stock shall mean the
          fair value per share as determined  in good faith by the Board,  which
          determination  shall be described in a statement filed with the Rights
          Agent and shall be conclusive  for all  purposes.  For all purposes of
          this Agreement,  the "current market price" of one ten-thousandth of a
          share of Preferred  Stock shall be equal to the "current market price"
          of one share of Preferred Stock divided by 10,000.

     (e) Anything herein to the contrary  notwithstanding,  no adjustment in the
Purchase  Price  shall be  required  unless  such  adjustment  would  require an
increase  or  decrease  of at least  one  percent  (1%) in the  Purchase  Price;
provided, however, that any adjustments that by reason of this Section 11(e) are
not  required to be made shall be carried  forward and taken into account in any
subsequent  adjustment.  All calculations under this Section 11 shall be made to
the nearest cent or to the nearest  ten-millionth of a share of Preferred Stock,
or  hundred-thousandth of a share of Common Stock or other security, as the case
may be. Notwithstanding the first sentence of this Section 11(e), any adjustment

                                       18
<PAGE>

required by this Section 11 shall be made no later than the earlier of (i) three
years from the date of the transaction  that mandates such  adjustment,  or (ii)
the Expiration Date.

     (f) If as a result of an adjustment  made pursuant to Section  11(a)(ii) or
Section 13(a) hereof, the holder of any Right thereafter  exercised shall become
entitled to receive any securities  other than Preferred  Stock,  thereafter the
number of such other securities so receivable upon exercise of any Right and the
Purchase  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 Stock contained in Sections 11(a),  (b), (c), (e), (g),
(h), (i),  (j), (k) and (m), and the  provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the Preferred Stock shall apply on like terms to any such
other securities;  provided,  however,  that the Company shall not be liable for
its  inability to reserve and keep  available  for issuance upon exercise of the
Rights pursuant to Section  11(a)(ii) a number of shares of Common Stock greater
than the number then  authorized by the Company's  Certificate of  Incorporation
but not outstanding or reserved for other purposes.

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

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

     (i) The  Company  may elect on or after the date of any  adjustment  of the
Purchase Price to adjust the number of Rights,  in lieu of any adjustment in the
number of one ten-thousandths of a share of Preferred Stock purchasable upon the
exercise of a Right. Each of the Rights  outstanding after the adjustment in the
number of Rights shall be exercisable for the number of one ten-thousandths of a
share of Preferred Stock 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  Purchase  Price in effect
immediately  prior to adjustment of the Purchase  Price by the Purchase Price in
effect  immediately  after  adjustment of the Purchase Price.  The Company shall
make a public  announcement  of its  election  to adjust  the  number of Rights,
indicating  the record date for the  adjustment,  and, if known at the time, the
amount of the  adjustment to be made.  This record date may be the date on which
the  Purchase  Price is  adjusted  or any day  thereafter,  but,  if the  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

                                       19
<PAGE>

each  adjustment  of the number of Rights  pursuant to this Section  11(i),  the
Company shall, as promptly as practicable, cause to be distributed to holders of
record  of  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  Purchase
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.

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

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

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

     (m)  Anything  in this  Section  11 to the  contrary  notwithstanding,  the
Company  shall be entitled to make such  reductions  in the Purchase  Price,  in
addition to those adjustments  expressly  required by this Section 11, as and to
the extent that in their good faith  judgment  the Board shall  determine  to be
advisable in order that any (i)  consolidation  or  subdivision of the Preferred
Stock,  (ii) issuance  wholly for cash of any shares of Preferred  Stock at less
than the  current  market  price,  (iii)  issuance  wholly for cash of shares of
Preferred  Stock or  securities  that by their  terms  are  convertible  into or
exchangeable for shares of Preferred 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  Stock  shall not be taxable to such
stockholders.

                                       20
<PAGE>

     (n) The Company  covenants  and agrees that it shall not, at any time after
the  Distribution  Date,  (i)  consolidate  with any other Person  (other than a
Subsidiary  of the Company in a  transaction  that  complies  with Section 11(o)
hereof),  (ii) merge with or into any other Person  (other than a Subsidiary  of
the Company in a transaction that complies with Section 11(o) hereof),  or (iii)
sell or  transfer  (or  permit  any  Subsidiary  to sell  or  transfer),  in one
transaction,  or a series  of  related  transactions,  assets or  earning  power
aggregating  more than 50% of the assets or earning power of the Company and its
Subsidiaries  (taken as a whole) to any other Person or Persons  (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
complies with Section 11(o) hereof),  if (x) at the time of or immediately after
such consolidation,  merger or sale there are any charter or bylaw provisions or
any  rights,   warrants  or  other  instruments  or  securities  outstanding  or
agreements in effect that would  substantially  diminish or otherwise  eliminate
the  benefits   intended  to  be  afforded  by  the  Rights  or  (y)  prior  to,
simultaneously with or immediately after such consolidation, merger or sale, the
stockholders of the Person who constitutes,  or would constitute, the "Principal
Party" for purposes of Section 13(a) hereof shall have  received a  distribution
of  Rights  previously  owned  by  such  Person  or  any of  its  Affiliates  or
Associates. The Company shall not consummate any consolidation,  merger, sale or
transfer  described in clause (i),  (ii) or (iii) of the prior  sentence  unless
prior  thereto  the  Company  and such  other  Person  shall have  executed  and
delivered to the Rights Agent a  supplemental  agreement  evidencing  compliance
with this Section 11(n).

     (o) The Company covenants and agrees that, after the Distribution  Date, it
will not,  except as permitted  by Section 23,  Section 24 or Section 27 hereof,
take (or permit any Subsidiary to take) 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.

     (p)  Anything in this  Agreement to the  contrary  notwithstanding,  in the
event that the Company  shall at any time after the Record Date and prior to the
Distribution  Date (i) declare or pay any dividend on the outstanding  shares of
Common Stock payable in shares of Common Stock,  (ii) subdivide the  outstanding
shares of Common Stock, or (iii) combine the outstanding  shares of Common Stock
into a smaller number of shares, the number of Rights associated with each share
of Common Stock then outstanding, or issued or delivered thereafter but prior to
the Distribution Date, shall be  proportionately  adjusted so that the number of
Rights thereafter  associated with each share of Common Stock following any such
event  shall  equal the  result  obtained  by  multiplying  the number of Rights
associated with each share of Common Stock  immediately prior to such event by a
fraction,  the  numerator of which shall be the number of shares of Common Stock
outstanding   immediately  prior  to  the  occurrence  of  such  event  and  the
denominator  of which shall be the number of shares of Common Stock  outstanding
immediately following the occurrence of such event.

Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever
an  adjustment  is made as  provided  in Section  11 or  Section 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  Stock and the
Common Stock, a copy of such  certificate,  and (c) mail a brief summary thereof
to each holder of a Rights  Certificate (or, if prior to the Distribution  Date,
to each  holder  of a  certificate  representing  shares  of  Common  Stock)  in
accordance with Section 26 hereof.  The Rights Agent shall be fully protected in

                                       21
<PAGE>

relying on any such  certificate  and on any  adjustment  therein  contained and
shall not be deemed to have  knowledge  of any  adjustment  unless  and until it
shall have received such certificate.

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

     (a) In the event that,  at any time after a Person has become an  Acquiring
Person,  (x) the Company shall  consolidate  with,  or merge with and into,  any
other  Person  (other than a  Subsidiary  of the Company in a  transaction  that
complies with Section 11(o) hereof), and the Company shall not be the continuing
or surviving  corporation of such consolidation or merger, (y) any Person (other
than a Subsidiary  of the Company in a  transaction  that  complies with Section
11(o) hereof) shall  consolidate  with, or merge with or into, the Company,  and
the  Company  shall  be  the   continuing  or  surviving   corporation  of  such
consolidation  or merger and, in connection with such  consolidation  or merger,
all or part of the  outstanding  shares of Common Stock shall be changed into or
exchanged for stock or other securities of any other Person or cash or any other
property, or (z) the Company shall sell or otherwise transfer (or one or more of
its  Subsidiaries  shall sell or otherwise  transfer),  in one  transaction or a
series of related  transactions,  assets or earning power  aggregating more than
50% of the assets or earning power of the Company and its Subsidiaries (taken as
a whole) to any Person or Persons  (other than the Company or any  Subsidiary of
the Company in one or more  transactions  each of which  complies  with  Section
11(o) hereof), then, and in each such case and except as contemplated by Section
13(d)  hereof,  proper  provision  shall be made so that:  (i) 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 the then current Purchase Price
in  accordance  with  the  terms  of this  Agreement,  such  number  of  validly
authorized and issued, fully paid, non-assessable and freely tradeable shares of
Common Stock of the Principal Party (as such term is hereinafter defined), which
shall not be  subject  to any liens,  encumbrances,  rights of first  refusal or
other  adverse  claims,  as  shall  be  equal  to  the  result  obtained  by (1)
multiplying the then current Purchase Price by the number of one ten-thousandths
of a share of Preferred Stock for which a Right is exercisable immediately prior
to the first occurrence of a Section 13 Event (or, if a Section  11(a)(ii) Event
has occurred  prior to the first  occurrence of a Section 13 Event,  multiplying
the  number  of such  one  ten-thousandths  of a  share  for  which a Right  was
exercisable  immediately  prior to the first  occurrence of a Section  11(a)(ii)
Event  by  the  Purchase  Price  in  effect  immediately  prior  to  such  first
occurrence),   and  (2)  dividing  that  product  (which,  following  the  first
occurrence of a Section 13 Event,  shall be referred to as the "Purchase  Price"
for each Right and for all  purposes  of this  Agreement)  by 50% of the current
market price  (determined  pursuant to Section 11(d)(i) hereof) per share of the
Common Stock of such Principal Party on the date of consummation of such Section
13 Event;  (ii) 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;  (iii)  the  term  "Company"  shall
thereafter be deemed to refer to such  Principal  Party,  it being  specifically
intended that,  subject to clause (v) below, the provisions of Section 11 hereof
shall apply only to such  Principal  Party  following the first  occurrence of a
Section 13 Event;  (iv) such Principal  Party shall take such steps  (including,
but not  limited to, the  reservation  of a  sufficient  number of shares of its
Common Stock) in connection with the consummation of any such transaction as may
be  necessary  to  assure  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 (v) the

                                       22
<PAGE>

provisions of Section 11(a)(ii) hereof shall be of no effect following the first
occurrence of any Section 13 Event.

     (b) "Principal Party" shall mean

          (i) in the case of any  transaction  described in clause (x) or (y) of
     the first sentence of Section  13(a),  the Person that is the issuer of any
     securities  into which shares of Common Stock of the Company are  converted
     in such merger or  consolidation,  and if no securities are so issued,  the
     Person that is the other party to such merger or consolidation; and

          (ii) in the case of any  transaction  described  in clause  (z) of the
     first sentence of Section 13(a), the Person that is the party receiving the
     greatest  portion of the assets or earning  power  transferred  pursuant to
     such transaction or transactions;

provided, however, that in any such case, (1) if the Common Stock of such Person
is not at such time and has not been continuously over the preceding twelve (12)
month period registered under Section 12 of the Exchange Act, and such Person is
a direct or indirect  Subsidiary of another  Person the Common Stock of which is
and has been so registered,  "Principal Party" shall refer to such other Person;
(2) in case such Person is a Subsidiary,  directly or  indirectly,  of more than
one  Person,  the  Common  Stocks  of two or more of which  are and have been so
registered,  "Principal  Party"  shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest  aggregate  market value; and (3)
in case 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 (1) and (2)  above  shall  apply to each of the
chains of  ownership  having an interest in such joint  venture as if such party
were a  "Subsidiary"  of both or all of such joint  ventures  and the  Principal
Parties in each such chain shall bear the  obligations set forth in this Section
13 in the same ratio as their  direct or indirect  interests in such Person bear
to the total of such interests.

     (c) The Company shall not consummate any such  consolidation,  merger, sale
or  transfer  unless  the  Principal  Party  shall have a  sufficient  number of
authorized  shares of its 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  Principal  Party shall
have  executed  and  delivered  to the  Rights  Agent a  supplemental  agreement
providing for the terms set forth in  paragraphs  (a) and (b) of this Section 13
and  further  providing  that,  as soon as  practicable  after  the  date of any
consolidation,  merger  or sale of assets  mentioned  in  paragraph  (a) of this
Section 13, the Principal Party will

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

                                       23
<PAGE>

          (ii) use its best  efforts to qualify or  register  the Rights and the
     securities  purchasable upon exercise of the Rights under the blue sky laws
     of such jurisdictions as may be necessary or appropriate; and

          (iii) deliver to holders of the Rights historical financial statements
     for the  Principal  Party  and each of its  Affiliates  that  comply in all
     respects  with the  requirements  for  registration  on Form 10  under  the
     Exchange Act.

The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers. In the event that a Section 13 Event
shall  occur at the same  time as, or at any time  after,  the  occurrence  of a
Section  11(a)(ii)  Event,  the Rights that have not theretofore  been exercised
shall thereafter become exercisable in the manner described in Section 13(a).

     (d) Notwithstanding anything in this Agreement to the contrary,  Section 13
shall not be applicable to a transaction  described in subparagraphs (x) and (y)
of Section 13(a) if (i) such transaction is consummated with a Person or Persons
(or a wholly owned subsidiary of any such Person or Persons) who acquired shares
of Common  Stock  pursuant  to a  Permitted  Offer,  (ii) the price per share of
Common  Stock paid in such  transaction  is not less than the price per share of
Common  Stock paid to all holders of shares of Common  Stock  whose  shares were
purchased  pursuant to such Permitted Offer, and (iii) the form of consideration
paid in such transaction is the same as the form of consideration  paid pursuant
to such Permitted Offer. Upon consummation of any such transaction  contemplated
by this Section 13(d), all Rights hereunder shall expire.

Section 14. Fractional Rights and Fractional Shares.

     (a) The Company shall not be required to issue fractions of Rights,  except
prior to the Distribution Date as provided in Section 11(i) or (p) hereof, or to
distribute Rights  Certificates that 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 purposes of this Section 14(a),  the current market
value of a whole Right shall be the closing  price of the Rights for the Trading
Day  immediately  prior to the date on which such  fractional  Rights would have
been  otherwise  issuable.  The closing price of the Rights for any day shall be
the last sale price,  regular  way, or, in case no such sale takes place on such
day,  the average of the closing bid and asked  prices,  regular  way, in either
case as reported in the principal consolidated transaction reporting system with
respect to securities  listed or admitted to trading on the  principal  national
securities exchange on which the Rights are listed or admitted to trading, or if
the Rights  are not listed or  admitted  to trading on any  national  securities
exchange,  the last quoted  price or, if not so quoted,  the average of the high
bid and the 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 Rights are
not quoted by any such  organization,  the  average of the closing bid and asked
prices as furnished by a professional market maker making a market in the Rights
selected by the Board.  All references in this Section to closing  prices,  last
quoted prices or other stock prices means prices during  regular  trading hours,
without giving effect to any  after-hours  or extended hours trading.  If on any
such date no such market maker is making a market in the Rights,  the fair value
of the Rights on such date as  determined  in good  faith by the Board  shall be

                                       24
<PAGE>

used,  which  determination  shall be  described  in a statement  filed with the
Rights Agent and shall be conclusive for all purposes.

     (b) The  Company  shall not be  required  to issue  fractions  of shares of
Preferred  Stock  (other  than  fractions  that are  integral  multiples  of one
ten-thousandth  of a share of Preferred Stock) upon exercise of the Rights or to
distribute  certificates  that  evidence  fractional  shares of Preferred  Stock
(other than fractions  that are integral  multiples of one  ten-thousandth  of a
share of Preferred  Stock).  Fractional  shares of  Preferred  Stock in integral
multiples  of one  ten-thousandth  of a share of  Preferred  Stock  may,  at the
election of the Company, be evidenced by depositary receipts; provided, however,
that holders of such depositary  receipts shall have all of the designations and
the powers,  preferences  and rights,  and the  qualifications,  limitations and
restrictions  to which they are entitled as  beneficial  owners of the shares of
Preferred Stock represented by such depositary  receipts.  In lieu of fractional
shares of Preferred  Stock (other than fractions that are integral  multiples of
one  ten-thousandth of a share of Preferred 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 one  ten-thousandth  of a share of Preferred Stock. For purposes
of this Section 14(b), the current market value of one ten-thousandth of a share
of Preferred Stock shall be one  ten-thousandth  of the closing price of a share
of Preferred Stock (as determined  pursuant to Section 11(d)(ii) hereof) for the
Trading Day immediately prior to the date of such exercise.

     (c) Following the occurrence of a Triggering  Event,  the Company shall not
be required to issue  fractions of shares of Common  Stock upon  exercise of the
Rights or to distribute  certificates that evidence  fractional shares of Common
Stock.  In lieu of 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 price of one (1) share of Common Stock (as determined pursuant to
Section  11(d)(i)  hereof) for the Trading Day immediately  prior to the date of
such exercise.

     (d) The holder of a Right by the acceptance of such Right expressly  waives
his right to  receive  any  fractional  Rights  or any  fractional  shares  upon
exercise of a Right, except as permitted by this Section 14.

Section 15. Rights of Action. All rights of action in respect of this Agreement,
except the rights of action  expressly  given to the Rights  Agent in 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
Common Stock); and any registered holder of any Rights Certificate (or, prior to
the Distribution  Date, of the 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 Common Stock),  may, in his own behalf and for his own
benefit,  enforce, and may institute and maintain any suit, action or proceeding
against  the Company to enforce,  or  otherwise  act in respect of, his right to
exercise the Rights evidenced by such 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 shall be entitled to specific  performance

                                       25
<PAGE>

of the obligations  hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.

Section 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 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 office 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
duly completed and fully executed;

     (c) subject to Section 6(a) and Section  7(f)  hereof,  the Company and the
Rights  Agent may deem and treat the person in whose  name a 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, subject to the penultimate sentence of Section
7(e) hereof, shall be required to be affected by any notice to the contrary; and

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

Section 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 the holder of the number of one  ten-thousandths  of a
share of Preferred Stock or any other  securities of the Company that 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.

                                       26
<PAGE>

Section 18. Concerning the Rights Agent.

     (a) The Company agrees to pay to the Rights Agent  reasonable  compensation
for all services  rendered by it hereunder  and, from time to time, on demand of
the Rights Agent, its reasonable expenses and counsel fees and disbursements and
other  disbursements  incurred  in the  administration  and  execution  of  this
Agreement and the exercise and performance of its duties hereunder.  The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless  against,
any loss, liability or expense, incurred without gross negligence,  bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
by the Rights Agent in connection with the acceptance and administration of this
Agreement,  including  the costs and expenses of defending  against any claim of
liability in the premises.

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

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

     (a) Any  corporation  into which the Rights Agent or any  successor  Rights
Agent may be merged or with  which it may be  consolidated,  or any  corporation
resulting  from any merger or  consolidation  to which the  Rights  Agent or any
successor  Rights Agent shall be a party, or any  corporation  succeeding to the
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  a  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 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.

     (b) 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.

                                       27
<PAGE>

Section 20. Duties of Rights Agent.  The Rights Agent  undertakes the duties and
obligations  imposed by this Agreement upon the following  terms and conditions,
by all of which the  Company and the  holders of 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 opinion of such  counsel  shall be full and
complete authorization and protection to the Rights Agent as to any action taken
or omitted by it in good faith and in accordance with such opinion.

     (b)  Whenever in the  performance  of its duties under this  Agreement  the
Rights  Agent  shall  deem it  necessary  or  desirable  that any fact or matter
(including,  without  limitation,  the identity of any Acquiring  Person and the
determination of "current 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 the
Chairman of the Board,  the President,  any Vice President,  the Treasurer,  any
Assistant Treasurer, the Secretary or any Assistant Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full  authorization
to the Rights  Agent for any action  taken or suffered in good faith by it under
the provisions of this Agreement in reliance upon such certificate.

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

     (d) The  Rights  Agent  shall not be liable  for or by reason of any of the
statements  of fact or recitals  contained  in this  Agreement  or in the Rights
Certificates   or  be   required   to  verify   the  same   (except  as  to  its
countersignature  on such  Rights  Certificates),  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 adjustment  required under the provisions of Section 11,
Section 13 or Section 24 hereof or responsible for the manner,  method or amount
of any such adjustment or the  ascertaining of the existence of facts that would
require  any such  adjustment  (except  with  respect to the  exercise of Rights
evidenced by Rights  Certificates after receipt of a certificate  describing any
such  adjustment,  delivered  pursuant to Section  12);  nor shall it by any act
hereunder  be  deemed  to  make  any   representation  or  warranty  as  to  the
authorization or reservation of any shares of Common Stock or Preferred Stock to
be issued pursuant to this Agreement or any Rights  Certificate or as to whether
any shares of Common Stock or Preferred Stock will,  when so issued,  be validly
authorized and issued, fully paid and nonassessable.

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

                                       28
<PAGE>

     (g)  The  Rights  Agent  is  hereby   authorized  and  directed  to  accept
instructions  with respect to the  performance of its duties  hereunder from the
Chairman of the Board,  the President,  any Vice President,  the Secretary,  any
Assistant  Secretary,  the Treasurer or any Assistant  Treasurer of the Company,
and to apply to such officers for advice or  instructions in connection with its
duties,  and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance  with  instructions  of any such officer.  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  with  respect  to its  duties  or
obligations  under this Rights Agreement and the date on and/or after which such
action  shall be taken or omitted  and the Rights  Agent shall not be liable for
any action taken or omitted in accordance  with a proposal  included in any such
application on or after the date specified therein (which date shall not be less
than five Business Days after the date any such officer  actually  receives such
application,  unless  any such  officer  shall have  consented  in writing to an
earlier  date) unless,  prior to taking or omitting any such action,  the Rights
Agent  has  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,  however, 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 not been
completed,  the Company and the Rights Agent will deem the  beneficial  owner of
the rights evidenced by such Rights  Certificate to be an Acquiring Person or an
Affiliate or Associate  thereof and such assignment or election to purchase will
not be honored.

Section 21.  Change of Rights Agent.  The Rights Agent or any  successor  Rights
Agent may resign and be discharged  from its duties under this Agreement upon 30
days' notice in writing mailed to the Company, and to each transfer agent of the
Common Stock and Preferred  Stock,  by registered or certified  mail, and to the

                                       29
<PAGE>

holders of the Rights  Certificates by first-class  mail. The Company may remove
the Rights Agent or any successor  Rights Agent upon 30 days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to
each transfer  agent of the Common Stock and Preferred  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 30 days
after giving  notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Rights  Certificate (who shall, with such notice,  submit his
Rights Certificate for inspection by the Company), then any 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) 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 stock  transfer  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
$50,000,000 or (b) an affiliate of a corporation described in clause (a) of this
sentence. After appointment, the successor Rights Agent shall be vested with the
same powers,  rights,  duties and  responsibilities as if it had been originally
named as Rights Agent without  further act or deed; but the  predecessor  Rights
Agent shall deliver and transfer to the  successor  Rights Agent any property at
the time held by it  hereunder,  and execute and deliver any further  assurance,
conveyance,  act or deed necessary for the purpose. Not later than the effective
date of any such  appointment,  the Company shall file notice thereof in writing
with the  predecessor  Rights Agent and each transfer  agent of the Common Stock
and the Preferred  Stock, and mail a notice thereof in writing 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.

Section 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 the Board to reflect any adjustment or change in the Purchase
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.

Section 23. Redemption.

     (a) The Board of Directors  of the Company may, at its option,  at any time
prior to the earlier of (i) the close of business on the tenth day following the
Stock  Acquisition  Date (or, if the Stock  Acquisition Date shall have occurred
prior to the Record Date,  the close of business on the tenth day  following the
Record Date), or (ii) the Final  Expiration  Date,  redeem all but not less than
all the then outstanding Rights at a redemption price of $.01 per Right, as such
amount may be appropriately  adjusted to reflect any stock split, stock dividend
or similar  transaction  occurring after the date hereof (such  redemption price
being hereinafter referred to as the "Redemption Price") and the Company may, at
its option,  pay the Redemption Price either in shares of Common Stock (based on

                                       30
<PAGE>

the "current market price," as defined in Section 11(d)(i) hereof, of the shares
of Common Stock at the time of  redemption)  or cash;  provided,  however,  that
notwithstanding   the  foregoing  if,   following  the  occurrence  of  a  Stock
Acquisition  Date and  following the  expiration of the right of redemption  set
forth above in this Section  23(a),  either  (i)(A) a Person who is an Acquiring
Person shall have  transferred  or  otherwise  disposed of a number of shares of
Common  Stock in one  transaction  or series of  transactions,  not  directly or
indirectly  involving  the  Company or any of its  Subsidiaries,  such that such
Person is thereafter a Beneficial Owner of 10% or less of the outstanding shares
of Common Stock, and (B) there are no other Persons,  immediately  following the
occurrence of the event described in clause (A), who are Acquiring Persons,  and
(C)  a  majority  of  the  members  of  the  Board  of  Directors   approve  the
reinstatement of the right of redemption pursuant to this Section 23, or (ii)(A)
the Board  Immediately  upon the action of the Board  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 shall  terminate  and the only right  thereafter of the holders of Rights
shall be to receive the Redemption Price for each Right so held.  Promptly after
the action of the Board 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 each  holder's
last address as it appears 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 that 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.

     (b) In the event of a  redemption  of the  Rights in  accordance  with this
Agreement, the Company may, at its option, discharge all of its obligations with
respect to the Rights by (i) issuing a press  release  announcing  the manner of
redemption  of the Rights in  accordance  with this  Agreement  and (ii) mailing
payment of the Redemption Price to the registered holders of the Rights at their
last  addresses  as they appear on the  registry  books of the Rights  Agent or,
prior to the  Distribution  Date, on the registry books of the Transfer Agent of
the  Common  Stock,  and upon such  action,  all  outstanding  Rights  and Right
Certificates shall be null and void without any further action by the Company.

Section 24. Exchange.

     (a) The Board may,  at its  option,  at any time after a Section  11(a)(ii)
Event,  exchange  all or part of the then  outstanding  and  exercisable  Rights
(which (i) shall not  include  Rights  that have  become  void  pursuant  to the
provisions of Section 7(e) hereof, and (ii) shall include,  without  limitation,
any Rights issued after the Distribution  Date) 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  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  shares of Common
Stock then outstanding.

                                       31
<PAGE>

     (b)  Immediately  upon the action of the Board ordering the exchange of any
Rights  pursuant to subsection  (a) of this Section 24,  evidence of which shall
have been  filed with the Rights  Agent,  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 promptly give public notice
of any such exchange; provided, however, that the failure to give, or any defect
in, such notice  shall not affect the  validity  of such  exchange.  The Company
promptly  shall mail a notice of any such exchange to all of the holders of such
Rights at their last  addresses  as they appear upon the  registry  books of the
Rights Agent.  Any notice that is mailed in the manner herein  provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
exchange  shall state the method by which the exchange of shares of Common Stock
for Rights will be  effected  and,  in the event of any  partial  exchange,  the
number of Rights that will be exchanged.  Any partial exchange shall be effected
pro rata based on the number of Rights  (other than Rights that have become void
pursuant  to the  provisions  of Section  7(e)  hereof)  held by each  holder of
Rights.

     (c) In any  exchange  pursuant  to this  Section  24, the  Company,  at its
option, may substitute  Preferred Stock (or equivalent  preferred stock, as such
term is defined in Section 11(b) hereof) for shares of Common Stock exchangeable
for Rights,  at the initial rate of one  ten-thousandth  of a share of Preferred
Stock  (or  equivalent  preferred  stock)  for each  share of Common  Stock,  as
appropriately  adjusted  to  reflect  adjustments  in the  voting  rights of the
Preferred  Stock  pursuant to Section 3(A) of the  Certificate  of  Designations
attached hereto as Exhibit A, so that the fraction of a share of Preferred Stock
(or equivalent  preferred stock) delivered in lieu of each share of Common Stock
shall have the same voting rights as one share of Common Stock.

     (d) In the event that there shall not be sufficient  shares of Common Stock
or Preferred  Stock issued but not  outstanding  or  authorized  but unissued to
permit any exchange of Rights as  contemplated  in accordance  with this Section
24, the Company  shall take all such  action as may be  necessary  to  authorize
additional  shares of Common Stock or Preferred Stock for issuance upon exchange
of the Rights.

     (e) The  Company  shall not be  required  to issue  fractions  of shares of
Common Stock or to distribute  certificates  that 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 Right  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.  For the purposes of this subsection (e), the current market value
of a whole share of Common Stock shall be the closing  price per share of Common
Stock (as determined pursuant to the second sentence of Section 11(d)(i) hereof)
for the Trading Day immediately  prior to the date of exchange  pursuant to this
Section 24.

Section 25. Notice of Certain Events.

     (a) In case the Company shall propose,  at any time after the  Distribution
Date,  (i) to pay any  dividend  payable in stock of any class to the holders of
Preferred  Stock or to make any other  distribution  to the holders of Preferred

                                       32
<PAGE>

Stock (other than a regular  quarterly cash dividend out of earnings or retained
earnings of the  Company),  or (ii) to offer to the holders of  Preferred  Stock
rights or warrants to  subscribe  for or to purchase  any  additional  shares of
Preferred Stock or shares of stock of any class or any other securities,  rights
or  options,  or (iii) to effect any  reclassification  of its  Preferred  Stock
(other than a  reclassification  involving  only the  subdivision of outstanding
shares of Preferred  Stock),  or (iv) to effect any consolidation or merger into
or  with  any  other  Person  (other  than  a  Subsidiary  of the  Company  in a
transaction  that complies with Section 11(o) hereof),  or to effect any sale or
other transfer (or to permit one or more of its  Subsidiaries to effect any sale
or other transfer),  in one transaction or a series of related transactions,  of
more than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other than the Company and/or
any of its Subsidiaries in one or more  transactions each of which complies with
Section 11(o) hereof), or (v) to effect the liquidation,  dissolution or winding
up of the  Company,  then,  in each such case,  the  Company  shall give to each
holder of a Rights  Certificate,  to the extent  feasible and in accordance with
Section 26 hereof,  a notice of such  proposed  action,  which shall specify the
record date for the purposes of such stock  dividend,  distribution of rights or
warrants,  or the date on which such  reclassification,  consolidation,  merger,
sale, transfer, liquidation, dissolution, or winding up is to take place and the
date of  participation  therein by the holders of the shares of Preferred Stock,
if any such date is to be fixed,  and such notice  shall be so given in the case
of any action  covered by clause (i) or (ii) above at least 20 days prior to the
record  date for  determining  holders  of the  shares  of  Preferred  Stock for
purposes of such action,  and in the case of any such other action,  at least 20
days  prior to the date of the  taking  of such  proposed  action or the date of
participation therein by the holders of the shares of Preferred Stock, whichever
shall be the earlier.

     (b) In case a Section 11(a)(ii) Event shall occur,  then, in any such case,
(i) the Company shall as soon as practicable thereafter give to each holder of a
Rights  Certificate,  to the extent  feasible and 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 Section  11(a)(ii)
hereof,  and (ii) all references in the preceding  paragraph to Preferred  Stock
shall be deemed thereafter to refer also to Common Stock and/or, if appropriate,
other securities; provided that the failure to give such notice shall not affect
the validity of such consent.

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

                                    Thermo Electron Corporation
                                    81 Wyman Street
                                    Waltham, Massachusetts 02454
                                    Attention: Corporate Secretary

Subject to the provisions of Section 21, 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:

                                       33
<PAGE>
                                    American Stock Transfer & Trust Company
                                    59 Maiden Lane
                                    New York, NY  10038
                                    Attention:  Corporate Trust Department

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  (or,  if
prior to the  Distribution  Date,  to the  holder of  certificates  representing
shares  of  Common  Stock)  shall  be  sufficiently  given  or  made  if sent by
first-class  mail,  postage prepaid,  addressed to such holder at the address of
such holder as shown on the registry books of the Company.

Section 27.  Supplements and  Amendments.  Except as provided in the penultimate
sentence of this Section 27, for so long as the Rights are then redeemable,  the
Company may, in its sole and absolute discretion, and the Rights Agent shall, if
the Company so directs,  supplement or amend any provision of this  Agreement in
any respect without the approval of any holders of the Rights.  At any time when
the Rights  are no longer  redeemable,  except as  provided  in the  penultimate
sentence of this Section 27, the Company may, by approval of at least 75% of the
members of the Board,  and the Rights  Agent  shall,  if the Company so directs,
supplement or amend this Agreement without the approval of any holders of Rights
in  order  (i) to cure  any  ambiguity  or (ii) to  correct  or  supplement  any
provision contained herein which may be defective or inconsistent with any other
provisions herein, provided that no such supplement or amendment shall adversely
affect the  interests  of the holders of Rights as such (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. Notwithstanding
anything contained in this Agreement to the contrary, no supplement or amendment
shall be made that changes the Redemption Price. Prior to the Distribution Date,
the  interests  of the  holders of Rights  shall be deemed  coincident  with the
interests of the holders of Common Stock.

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

Section 29. Actions by the Board,  etc. The Board shall have the exclusive power
and authority to administer this Agreement and to exercise all rights and powers
specifically  granted to the Board or to the Company,  or as may be necessary or
advisable  in  the   administration  of  this  Agreement,   including,   without
limitation,  the  right  and  power  to (i)  interpret  the  provisions  of this
Agreement,  and (ii) make all  determinations  deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend this Agreement).  All such actions,  calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing)  that 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  and all other  parties,  and (y) not
subject the Board to any liability to the holders of the Rights.

                                       34
<PAGE>

Section  30.  Benefits of this  Agreement.  Nothing in this  Agreement  shall be
construed to give to any Person other than the Company, the Rights Agent and the
registered  holders of the Rights  Certificates  (and, prior to the Distribution
Date,  registered  holders of the 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,
registered holders of the Common Stock).

Section 31.  Severability.  If any term,  provision,  covenant or restriction of
this Agreement is held by a court of competent  jurisdiction  or other authority
to be invalid,  void or unenforceable,  the remainder of the terms,  provisions,
covenants  and  restrictions  of this  Agreement  shall remain in full force and
effect  and shall in no way be  affected,  impaired  or  invalidated;  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 determines in its good faith
judgment that  severing the invalid,  void or  unenforceable  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.

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

Section  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.

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

                                       35
<PAGE>

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

Attest:                                 THERMO ELECTRON CORPORATION

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

Attest:                                 AMERICAN STOCK TRANSFER & TRUST COMPANY

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

                                       36
<PAGE>
                                                                       EXHIBIT A

                                     FORM OF

                           CERTIFICATE OF DESIGNATIONS

                                       OF

                  SERIES B JUNIOR PARTICIPATING PREFERRED STOCK

                                       OF

                           THERMO ELECTRON CORPORATION

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

Thermo Electron Corporation, a corporation organized and existing under the laws
of  the  State  of  Delaware  (hereinafter  called  the  "Corporation"),  hereby
certifies that the following resolution was adopted by the Board of Directors of
the Corporation at a meeting duly called and held on January 19, 1996:

 RESOLVED:          That pursuant to the authority  granted to and vested in the
                    Board of Directors of the  Corporation  (hereinafter  called
                    the  "Board")  in  accordance  with  the  provisions  of the
                    Certificate of Incorporation,  as amended,  the Board hereby
                    creates a series of  Preferred  Stock,  $100 par value  (the
                    "Preferred Stock"), of the Corporation and hereby states the
                    designation  and  number of shares,  and fixes the  relative
                    rights, preferences and limitations thereof as follows:

     Series B Junior Participating Preferred Stock:

     Section 1.  Designation  and  Amount.  The shares of such  series  shall be
designated  as "Series B Junior  Participating  Preferred  Stock" (the "Series B
Preferred  Stock") and the number of shares  constituting the Series B Preferred
Stock shall be Forty Thousand  (40,000).  Such number of shares may be increased
or decreased by  resolution  of the Board prior to issuance;  provided,  that no
decrease  shall  reduce  the number of shares of Series B  Preferred  Stock to a
number less than the number of shares then outstanding plus the number of shares
reserved  for  issuance  upon the  exercise of  outstanding  options,  rights or
warrants or upon the  conversion  of any  outstanding  securities  issued by the
Corporation convertible into Series B Preferred Stock.

     Section 2. Dividends and Distributions.

     (A)  Subject  to the  rights of the  holders of any shares of any series of
Preferred  Stock (or any similar stock) ranking prior and superior to the Series
B Preferred  Stock with respect to dividends,  the holders of shares of Series B
Preferred  Stock, in preference to the holders of Common Stock,  par value $1.00
per share (the  "Common  Stock"),  of the  Corporation,  and of any other junior
stock,  shall be entitled to receive,  when, as and if declared by the Board out
of funds of the  Corporation  legally  available  for the payment of  dividends,
quarterly  dividends  payable  in cash on March 31,  June 30,  September  30 and
December  31 in each  year  (each  such  date  being  referred  to  herein  as a

                                      A-1
<PAGE>

"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 B Preferred  Stock,  in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $100 or (b) subject to the provision for  adjustment
hereinafter  set forth,  10,000 times the aggregate per share amount of all cash
dividends,  and 10,000 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 B Preferred  Stock.  In the event the  Corporation
shall at any time  declare or pay any  dividend on the Common  Stock  payable in
shares of Common Stock, or effect a subdivision, combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the amount to which holders of
shares of Series B Preferred Stock were entitled immediately prior to such event
under clause (b) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction,  the  numerator of which is the number of shares of Common
Stock  outstanding  immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding  immediately prior to
such event.  In the event the  Corporation  shall at any time declare or pay any
dividend on the Series B Preferred Stock payable in shares of Series B Preferred
Stock, or effect a subdivision,  combination or consolidation of the outstanding
shares of Series B Preferred  Stock (by  reclassification  or otherwise  than by
payment of a dividend in shares of Series B  Preferred  Stock) into a greater or
lesser number of shares of Series B Preferred Stock,  then in each such case the
amount to which  holders of shares of Series B  Preferred  Stock  were  entitled
immediately  prior to such event under clause (b) of the first  sentence of this
Section  2(A) shall be adjusted by  multiplying  such amount by a fraction,  the
numerator of which is the number of shares of Series B Preferred Stock that were
outstanding  immediately prior to such event and the denominator of which is the
number of shares of Series B Preferred Stock outstanding  immediately after such
event.

     (B) The Corporation  shall declare a dividend or distribution on the Series
B Preferred Stock as provided in paragraph (A) of this Section immediately after
it  declares a  dividend  or  distribution  on the Common  Stock  (other  than a
dividend  payable in shares of Common Stock) and the Corporation  shall pay such
dividend or  distribution on the Series B Preferred Stock before the dividend or
distribution  declared on the Common Stock is paid or set apart;  provided that,
in the event no dividend or distribution  shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date and the next
subsequent  Quarterly Dividend Payment Date, a dividend of $100 per share on the
Series B  Preferred  Stock  shall  nevertheless  be payable  on such  subsequent
Quarterly Dividend Payment Date.

     (C) Dividends shall begin to accrue and be cumulative on outstanding shares
of Series B  Preferred  Stock  from the  Quarterly  Dividend  Payment  Date next
preceding  the date of issue of such  shares,  unless  the date of issue of such
shares is prior to the  record  date for the first  Quarterly  Dividend  Payment
Date, in which case dividends on such shares shall begin to accrue from the date
of issue of such  shares,  or unless the date of issue is a  Quarterly  Dividend
Payment Date or is a date after the record date for the determination of holders
of shares of Series B Preferred  Stock entitled to receive a quarterly  dividend

                                      A-2
<PAGE>

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

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

     (A) Subject to the provision for  adjustment  hereinafter  set forth,  each
share of Series B  Preferred  Stock shall  entitle the holder  thereof to 10,000
votes on all matters submitted to a vote of the stockholders of the Corporation.
In the event the  Corporation  shall at any time  declare or pay any dividend on
the Common Stock  payable in shares of Common  Stock,  or effect a  subdivision,
combination  or  consolidation  of the  outstanding  shares of Common  Stock (by
reclassification  or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common  Stock,  then in each
such case the  number of votes per share to which  holders of shares of Series B
Preferred Stock were entitled  immediately prior to such event shall be adjusted
by multiplying  such number by a fraction,  the numerator of which is the number
of shares of Common  Stock  outstanding  immediately  after  such  event and the
denominator  of  which is the  number  of  shares  of  Common  Stock  that  were
outstanding  immediately prior to such event. In the event the Corporation shall
at any time declare or pay any dividend on the Series B Preferred  Stock payable
in shares of Series B Preferred  Stock, or effect a subdivision,  combination or
consolidation  of the  outstanding  shares  of  Series  B  Preferred  Stock  (by
reclassification  or otherwise than by payment of a dividend in shares of Series
B  Preferred  Stock)  into a  greater  or  lesser  number  of shares of Series B
Preferred  Stock,  then in each such case the number of votes per share to which
holders of shares of Series B Preferred Stock were entitled immediately prior to
such event  shall be  adjusted by  multiplying  such  amount by a fraction,  the
numerator of which is the number of shares of Series B Preferred Stock that were
outstanding  immediately prior to such event and the denominator of which is the
number of shares of Series B Preferred Stock outstanding  immediately after such
event.

     (B) Except as otherwise  provided herein, the holders of shares of Series B
Preferred  Stock and the holders of shares of Common Stock and any other capital
stock of the Corporation having general voting rights shall vote together as one
class on all matters submitted to a vote of stockholders of the Corporation.

     (C) (i) If at any time  dividends on any Series B Preferred  Stock shall be
in arrears in an amount equal to six quarterly dividends thereon, the holders of
the Series B Preferred Stock,  voting as a separate series from all other series
of Preferred Stock and classes of capital stock,  shall be entitled to elect two
members of the Board in addition to any  Directors  elected by any other series,
class or classes of  securities  and the  authorized  number of  Directors  will
automatically be increased by two. Promptly  thereafter,  the Board of Directors
of this Corporation shall, as soon as may be practicable, call a special meeting
of holders of Series B Preferred  Stock for the purpose of electing such members

                                      A-3
<PAGE>

of the  Board of  Directors.  Said  special  meeting  shall in any event be held
within 45 days of the occurrence of such arrearage.

          (ii) During any period  when the holders of Series B Preferred  Stock,
voting as a separate  series,  shall be entitled and shall have exercised  their
right  to  elect  two  Directors,  then,  and  during  such  time as such  right
continues,  (a) the then  authorized  number of Directors  shall be increased by
two, and the holders of Series B Preferred  Stock,  voting as a separate series,
shall be entitled to elect the  additional  Directors  so provided  for, and (b)
each such additional Director shall not be a member of any existing class of the
Board  of  Directors,   but  shall  serve  until  the  next  annual  meeting  of
stockholders for the election of Directors,  or until his or her successor shall
be  elected  and shall  qualify,  or until his or her right to hold such  office
terminates pursuant to the provisions of this Section 3(C).

          (iii) A Director  elected  pursuant to the terms hereof may be removed
with or without  cause by the  holders of Series B Preferred  Stock  entitled to
vote in an election of such Director.

          (iv) If, during any interval  between annual  meetings of stockholders
for the election of Directors and while the holders of Series B Preferred  Stock
shall be entitled to elect two Directors, there is no such Director in office by
reason of resignation,  death or removal,  then, promptly thereafter,  the Board
shall call a special  meeting of the holders of Series B Preferred Stock for the
purpose of filling such vacancy and such vacancy shall be filled at such special
meeting.  Such special  meeting shall in any event be held within 45 days of the
occurrence of such vacancy.

          (v) At such time as the  arrearage is fully cured,  and all  dividends
accumulated and unpaid on any shares of Series B Preferred Stock outstanding are
paid,  and, in addition  thereto,  at least one regular  dividend  has been paid
subsequent to curing such arrearage,  the term of office of any Director elected
pursuant to this Section  3(C),  or his or her  successor,  shall  automatically
terminate,  and the authorized number of Directors shall automatically  decrease
by two, the rights of the holders of the shares of the Series B Preferred  Stock
to vote as provided in this Section  3(C) shall  cease,  subject to renewal from
time to time upon the same terms and  conditions,  and the  holders of shares of
the Series B Preferred Stock shall have only the limited voting rights elsewhere
herein set forth.

     (D) Except as set forth herein, or as otherwise provided by law, holders of
Series B 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 4. Certain Restrictions.

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

                                      A-4
<PAGE>

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

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

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

          (iv) redeem or purchase or  otherwise  acquire for  consideration  any
shares of Series B Preferred  Stock,  or any shares of stock ranking on a parity
with the Series B 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.

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

     Section  5.  Reacquired  Shares.  Any  shares of Series B  Preferred  Stock
purchased  or otherwise  acquired by the  Corporation  in any manner  whatsoever
shall be retired and cancelled promptly after the acquisition  thereof. All such
shares shall upon their  cancellation  become  authorized but unissued shares of
Preferred  Stock and may be reissued as part of a new series of Preferred  Stock
subject to the  conditions and  restrictions  on issuance set forth herein or in
any other Certificate of Designation creating a series of Preferred Stock or any
similar stock or as otherwise required by law.

     Section 6. Liquidation, Dissolution or Winding Up.

     (A) Upon any liquidation,  dissolution or winding up of the Corporation, no
distribution  shall be made (1) to the holders of shares of stock ranking junior
(either as to dividends or upon  liquidation,  dissolution or winding up) to the
Series B Preferred Stock unless,  prior thereto, the holders of shares of Series
B Preferred  Stock shall have received  $100 per share,  plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such  payment,  provided  that the  holders of shares of Series B
Preferred  Stock  shall be entitled  to receive an  aggregate  amount per share,

                                      A-5
<PAGE>

subject to the provision for adjustment  hereinafter set forth,  equal to 10,000
times the aggregate  amount to be distributed  per share to holders of shares of
Common  Stock,  or (2) to the  holders  of shares of stock  ranking  on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with the
Series B Preferred  Stock,  except  distributions  made  ratably on the Series B
Preferred  Stock and all such parity stock in proportion to the total amounts to
which the  holders  of all such  shares  are  entitled  upon  such  liquidation,
dissolution or winding up.

     (B) Neither the consolidation,  merger or other business combination of the
Corporation with or into any other corporation nor the sale, lease,  exchange or
conveyance  of all or any  part  of the  property,  assets  or  business  of the
Corporation  shall be deemed to be a  liquidation,  dissolution or winding up of
the Corporation for purposes of this Section 6.

     (C) In the  event  the  Corporation  shall at any time  declare  or pay any
dividend  on the Common  Stock  payable in shares of Common  Stock,  or effect a
subdivision,  combination or consolidation  of the outstanding  shares of Common
Stock (by  reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the  aggregate  amount to which  holders of shares of Series B
Preferred Stock were entitled  immediately prior to such event under the proviso
in  clause  (1) of  paragraph  (A) of  this  Section  6  shall  be  adjusted  by
multiplying  such amount by a fraction,  the numerator of which is the number of
shares  of  Common  Stock  outstanding  immediately  after  such  event  and the
denominator  of  which is the  number  of  shares  of  Common  Stock  that  were
outstanding  immediately prior to such event. In the event the Corporation shall
at any time declare or pay any dividend on the Series B Preferred  Stock payable
in shares of Series B Preferred  Stock, or effect a subdivision,  combination or
consolidation  of the  outstanding  shares  of  Series  B  Preferred  Stock  (by
reclassification  or otherwise than by payment of a dividend in shares of Series
B  Preferred  Stock)  into a  greater  or  lesser  number  of shares of Series B
Preferred Stock, then in each such case the aggregate amount to which holders of
shares of Series B Preferred Stock were entitled immediately prior to such event
under the  proviso in clause  (1) of  paragraph  (A) of this  Section 6 shall be
adjusted by multiplying such amount by a fraction, the numerator of which is the
number of shares of Series B Preferred Stock that were  outstanding  immediately
prior to such  event  and the  denominator  of which is the  number of shares of
Series B Preferred Stock outstanding immediately after such event.

     Section 7.  Consolidation,  Merger,  etc.  Notwithstanding  anything to the
contrary  contained  herein,  in case  the  Corporation  shall  enter  into  any
consolidation,  merger,  combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other stock or  securities,  cash
and/or  any  other  property,  then in any such  case  each  share  of  Series B
Preferred Stock shall at the same time be similarly exchanged or changed into an
amount per share, subject to the provision for adjustment hereinafter set forth,
equal to 10,000 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. In the event the Corporation
shall at any time  declare or pay any  dividend on the Common  Stock  payable in
shares of Common Stock, or effect a subdivision, combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common  Stock,  then in each such case the  amount set forth in the
preceding  sentence with respect to the exchange or change of shares of Series B
Preferred Stock shall be adjusted by multiplying such amount by a fraction,  the

                                      A-6
<PAGE>

numerator  of  which  is the  number  of  shares  of  Common  Stock  outstanding
immediately  after  such  event and the  denominator  of which is the  number of
shares of Common Stock that were outstanding immediately prior to such event. In
the event the  Corporation  shall at any time declare or pay any dividend on the
Series B  Preferred  Stock  payable in shares of Series B  Preferred  Stock,  or
effect a subdivision,  combination or consolidation of the outstanding shares of
Series B Preferred Stock (by  reclassification or otherwise than by payment of a
dividend in shares of Series B Preferred  Stock) into a greater or lesser number
of shares of Series B  Preferred  Stock,  then in each such case the  amount set
forth in the first  sentence of this  Section 7 with  respect to the exchange or
change of shares of Series B Preferred  Stock  shall be adjusted by  multiplying
such amount by a  fraction,  the  numerator  of which is the number of shares of
Series B Preferred Stock that were outstanding  immediately  prior to such event
and the denominator of which is the number of shares of Series B Preferred Stock
outstanding immediately after such event.

     Section 8. No Redemption.  The shares of Series B Preferred Stock shall not
be redeemable.

     Section 9. Rank. The Series B Preferred  Stock shall rank,  with respect to
the payment of dividends and the distribution of assets, junior to all series of
any  other  class of the  Preferred  Stock  issued  either  before  or after the
issuance  of the Series B Preferred  Stock,  unless the terms of any such series
shall provide otherwise.

     Section 10. Amendment. The Certificate of Incorporation, as amended, of the
Corporation  shall not be amended in any manner that would  materially  alter or
change the powers, preferences or special rights of the Series B Preferred Stock
so as to affect them adversely without the affirmative vote of the holders of at
least two-thirds of the outstanding  shares of Series B Preferred Stock,  voting
together as a single class.

     Section 11.  Fractional  Shares.  Series B Preferred Stock may be issued in
fractions  of a share that shall  entitle  the  holder,  in  proportion  to such
holder's  fractional  shares,  to exercise  voting  rights,  receive  dividends,
participate in distributions and have the benefit of all other rights of holders
of Series B Preferred Stock.

     IN WITNESS WHEREOF,  this Certificate of Designations is executed on behalf
of the Corporation by its President and Chief Executive Officer this 19th day of
January, 1996.

                                THERMO ELECTRON CORPORATION

                                By:     /s/ George N. Hatsopoulos
                                        --------------------------------------
                                        George N. Hatsopoulos
                                        Chairman of the Board and President

<PAGE>

                                                                       EXHIBIT B
                          [Form of Rights Certificate]

Certificate No. R-                                                 ______ Rights

NOT  EXERCISABLE  AFTER  JANUARY 29, 2006 OR EARLIER IF REDEEMED OR EXCHANGED BY
THE  COMPANY.  THE RIGHTS ARE  SUBJECT  TO  REDEMPTION  AT $.01 PER RIGHT AND TO
EXCHANGE  ON  THE  TERMS  SET  FORTH  IN THE  RIGHTS  AGREEMENT.  UNDER  CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM IS
DEFINED IN THE RIGHTS  AGREEMENT) AND ANY  SUBSEQUENT  HOLDER OF SUCH RIGHTS MAY
BECOME NULL AND VOID. [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 SUCH AGREEMENT.]*

                               Rights Certificate

                           THERMO ELECTRON CORPORATION

This certifies  that , or registered  assigns,  is the  registered  owner of the
number of Rights set forth  above,  each of which  entitles  the owner  thereof,
subject to the terms,  provisions and conditions of the Rights Agreement,  dated
as of January 19, 1996 (as  amended,  the "Rights  Agreement"),  between  Thermo
Electron Corporation, a Delaware corporation (the "Company"), and American Stock
Transfer & Trust  Company (the  "Rights  Agent"),  to purchase  from the Company
after the  Distribution  Date (as such term is defined on the Rights  Agreement)
and at any time  prior to 5:00 P.M.  (Boston  time) on January  29,  2006 at the
office of the Rights Agent  designated  for such purpose,  or its  successors as
Rights Agent, one ten-thousandth of a fully paid, non-assessable share of Series
B Junior  Participating  Preferred Stock (the "Preferred Stock") of the Company,
$100 par  value  per  share,  at a  purchase  price of  $250.00  in cash per one
ten-thousandth  of  a  share  (the  "Purchase  Price"),  upon  presentation  and
surrender of this Rights  Certificate  with the Form of Election to Purchase and
related Certificate duly executed. The number of Rights evidenced by this Rights
Certificate (and the number of one ten-thousandths of a share of Preferred Stock
which may be purchased upon exercise  hereof) set forth above,  and the Purchase
Price set forth  above,  are the  number and  Purchase  Price as of the close of
business on January 29, 1996,  based on the Preferred  Stock as  constituted  at
-----------------------

* The portion of the legend in brackets shall be inserted only if applicable and
shall replace the preceding sentence.

                               B-1
<PAGE>

such date.  Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to such terms in the Rights Agreement.

     Upon the occurrence of a Section  11(a)(ii)  Event, if the Rights evidenced
by this Rights  Certificate are beneficially owned by (i) an Acquiring Person or
an  Affiliate  or  Associate  of any such  Acquiring  Person  (as such terms are
defined  in the  Rights  Agreement),  (ii) a  transferee  of any such  Acquiring
Person,  Associate or Affiliate  who becomes a  transferee  after the  Acquiring
Person  becomes  an  Acquiring  Person,  or (iii)  under  certain  circumstances
specified in the Rights  Agreement,  a transferee of a person who,  concurrently
with or after such  transfer,  became an  Acquiring  Person,  or an Affiliate or
Associate of an Acquiring Person,  such Rights shall become null and void and no
holder  hereof  shall have any right with  respect to such Rights from and after
the occurrence of such Section 11(a)(ii) Event.

     As provided in the Rights Agreement,  the Purchase Price and the number and
kind of shares of  Preferred  Stock or other  securities  which may be purchased
upon the exercise of the Rights evidenced by this Rights Certificate are subject
to modification  and adjustment upon the happening of certain events,  including
Section 11(a)(ii) Events.

     This  Rights  Certificate  is subject to all of the terms,  provisions  and
conditions of the Rights Agreement,  which terms,  provisions and conditions are
hereby  incorporated  herein by  reference  and made a part  hereof and to which
Rights Agreement  reference is hereby made for a full description of the rights,
limitations  of rights,  obligations,  duties and  immunities  hereunder  of the
Rights  Agent,  the Company and the  holders of the Rights  Certificates,  which
limitations of rights include the temporary  suspension of the exercisability of
such Rights under the specific  circumstances set forth in the Rights Agreement.
Copies of the  Rights  Agreement  are on file at the  principal  offices  of the
Company and are available upon written request to the Company.

     This Rights Certificate,  with or without other Rights  Certificates,  upon
surrender at the office of the Rights Agent  designated  for such purpose,  with
the Form of  Election  and  Certificate  set  forth  on the  reverse  side  duly
executed, may be exchanged for another Rights Certificate or Rights Certificates
of like tenor and date evidencing Rights entitling the holder to purchase a like
aggregate  number of one  ten-thousandths  of a share of Preferred  Stock as the
Rights evidenced by the Rights  Certificate or Rights  Certificates  surrendered
shall have entitled such holder to purchase. If this Rights Certificate shall be
exercised in part, the holder shall be entitled to receive upon surrender hereof
another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.

     Subject to the provisions of the Rights Agreement,  the Rights evidenced by
this  Certificate  may be redeemed by the Company at its option at a  redemption
price  of $.01  per  Right at any time  prior  to the  earlier  of the  close of
business on (i) the tenth day following the Stock Acquisition Date (as such time
period may be  extended  pursuant to the Rights  Agreement),  and (ii) the Final
Expiration Date.

     Subject to the provisions of the Rights Agreement,  the Company may, at its
option, at any time after a Section 11(a)(ii) Event, exchange all or part of the
Rights evidenced by this Certificate for shares of the Company's Common Stock or
for Preferred  Stock (or shares of a class or series of the Company's  preferred
stock  having the same  rights,  privileges  and  preferences  as the  Preferred
Stock).

                                      B-2
<PAGE>

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

     No holder of this Rights Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of shares of Preferred
Stock  or of any  other  securities  of the  Company  which  may at any  time be
issuable on the  exercise  hereof,  nor shall  anything  contained in the Rights
Agreement or herein be construed to confer upon the holder hereof,  as such, any
of the  rights  of a  stockholder  of the  Company  or any right to vote for the
election  of  directors  or upon any matter  submitted  to  stockholders  at any
meeting thereof,  or to give or withhold consent to any corporate  action, or to
receive notice of meetings or other actions  affecting  stockholders  (except as
provided  in the Rights  Agreement),  or to receive  dividends  or  subscription
rights,  or  otherwise,  until  the  Right or Rights  evidenced  by this  Rights
Certificate shall have been exercised as provided in the Rights Agreement.

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

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

     Dated as of _______________, _____

ATTEST:                                     THERMO ELECTRON CORPORATION

                                           By:
Secretary                                  Title:

COUNTERSIGNED:

American Stock Transfer & Trust Company, as Rights Agent

By:

         Authorized Signature

                                      B-3
<PAGE>

                          FORM OF ELECTION TO PURCHASE

                  (To be executed if holder desires to exercise
                  Rights represented by the Rights Certificate)

To: American Stock Transfer & Trust Company

     The  undersigned  hereby  irrevocably  elects to exercise  ________  Rights
represented by this Rights Certificate to purchase the shares of Preferred Stock
issuable  upon the  exercise  of the  Rights (or such  other  securities  of the
Company or of any other  person  which may be issuable  upon the exercise of the
Rights) and requests that  certificates for such shares be issued in the name of
and delivered to:

Please insert social security ___________________________________
or other identifying number _____________________________________

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

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

Please insert social security ___________________________________
or other identifying number______________________________________

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

Dated:

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

Signature Guaranteed:

                                      B-4
<PAGE>

                                   Certificate

     The undersigned hereby certifies by checking the appropriate boxes that:

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

     (2) after due inquiry and to the best knowledge of the undersigned,  it [ ]
did [ ] did not acquire the Rights evidenced by this Rights Certificate from any
Person who is, was or became an  Acquiring  Person or an  Affiliate or Associate
thereof.

Dated: ______________, __

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

Signature Guaranteed:

                                     NOTICE

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

                                      B-5
<PAGE>

                  [Form of Reverse Side of Rights Certificate]

                               FORM OF ASSIGNMENT

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

FOR VALUE RECEIVED_______________________________________________
hereby sells, assigns and transfers unto_________________________
        -----------------------------------------------------------------
                  (Please print name and address of transferee)
        -----------------------------------------------------------------
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _________________ Attorney,
to transfer the within Rights Certificate on the books of the within-named
Company, with full power of substitution.

Dated: __________________, ____

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

Signature Guaranteed:

                                   Certificate

     The undersigned  hereby  certifies that the Rights evidenced by this Rights
Certificate are not beneficially owned by an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights Agreement).

Dated:  ___________, ____

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

Signature Guaranteed:

                                      B-6

<PAGE>

                                                                       EXHIBIT C

                  SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK

     On January 19, 1996, the Board of Directors of Thermo Electron  Corporation
(the  "Company")  declared  a  dividend  distribution  of  one  Right  for  each
outstanding share of the Company's Common Stock to stockholders of record at the
close of business on January 29, 1996. Each Right entitles the registered holder
to purchase from the Company a unit consisting of one  ten-thousandth of a share
(a "Unit") of Series B Junior Participating Preferred Stock, $100 par value (the
"Preferred  Stock") at a Purchase Price of $250.00 in cash per Unit,  subject to
adjustment.  The  description  and terms of the Rights are set forth in a Rights
Agreement (as amended,  the "Rights Agreement") between the Company and American
Stock Transfer & Trust Company, as Rights Agent.

     Initially,  the Rights will be attached  to all Common  Stock  certificates
representing  shares then outstanding,  and no separate Rights Certificates will
be  distributed.   The  Rights  will  separate  from  the  Common  Stock  and  a
Distribution  Date will occur upon the earlier of (i) 10 days following a public
announcement  that a person or group of  affiliated  or  associated  persons (an
"Acquiring Person") has acquired,  or obtained the right to acquire,  beneficial
ownership of 15% or more of the  outstanding  shares of Common Stock (the "Stock
Acquisition  Date"),  or (ii) 10 business days following the  commencement  of a
tender  offer  or  exchange  offer  that  would  result  in a  person  or  group
beneficially  owning  15% or more of such  outstanding  shares of Common  Stock.
Until the  Distribution  Date,  (i) the Rights will be  evidenced  by the Common
Stock  certificates and will be transferred with and only with such Common Stock
certificates,  (ii) new  Common  Stock  certificates  will  contain  a  notation
incorporating  the Rights  Agreement by reference  and (iii) the  surrender  for
transfer of any certificates  for Common Stock  outstanding will also constitute
the transfer of the Rights  associated with the Common Stock represented by such
certificate.

     The Rights are not exercisable  until the Distribution Date and will expire
at the close of  business  on January  29,  2006,  unless  earlier  redeemed  or
exchanged by the Company as described below.

     As soon as practicable  after the Distribution  Date,  Rights  Certificates
will be mailed to  holders  of  record  of the  Common  Stock as of the close of
business  on  the  Distribution  Date  and,  thereafter,   the  separate  Rights
Certificates alone will represent the Rights.  Except as otherwise determined by
the Board of  Directors  and except in  connection  with shares of Common  Stock
issued upon the  exercise  of  employee  stock  options,  issuances  under other
employee  stock  benefit  plans or issuances  upon the  exercise,  conversion or
exchange of securities  issued prior to the  Distribution  Date,  only shares of
Common Stock issued prior to the Distribution Date will be issued with Rights.

     In the event that a Person becomes the  beneficial  owner of 15% or more of
the then outstanding shares of Common Stock, except pursuant to an offer for all
outstanding  shares of Common  Stock  that at least a  majority  of the Board of

                                      C-1
<PAGE>

Directors  determines  to be fair to, and  otherwise in the best  interests  of,
stockholders,  each holder of a Right will thereafter have the right to receive,
upon  exercise,   that  number  of  shares  of  Common  Stock  (or,  in  certain
circumstances,  cash,  property or other securities of the Company) which equals
the exercise  price of the Right divided by one-half of the current market price
(as  defined in the  Rights  Agreement)  of the Common  Stock at the date of the
occurrence of the event. However, Rights are not exercisable following the event
set forth  above until such time as the Rights are no longer  redeemable  by the
Company as set forth below. Notwithstanding any of the foregoing,  following the
occurrence of such event,  all Rights that are, or (under certain  circumstances
specified in the Rights  Agreement)  were,  beneficially  owned by any Acquiring
Person will be null and void.  The event set forth in this paragraph is referred
to as a "Section 11(a)(ii) Event."

     For  example,  at an exercise  price of $250.00  per Right,  each Right not
owned by an Acquiring Person (or by certain related parties)  following an event
set forth in the  preceding  paragraph  would entitle its holder to purchase for
$250.00 such number of shares of Common Stock (or other consideration,  as noted
above) as equals  $250.00  divided by one-half of the current  market  price (as
defined in the Rights  Agreement) of the Common Stock.  Assuming that the Common
Stock had a per share  value of $50.00 at such  time,  the  holder of each valid
Right would be entitled to purchase ten shares of Common Stock for $250.00.

     In the event  that,  at any time after any  person has become an  Acquiring
Person,  (i) the Company is acquired in a merger or other  business  combination
transaction in which the Company is not the surviving  corporation or its Common
Stock is  changed  or  exchanged  (other  than a merger  which  follows an offer
determined  by the  Board of  Directors  to be fair as  described  in the  first
sentence  of the  second  preceding  paragraph),  or  (ii)  50% or  more  of the
Company's assets or earning power is sold or transferred, each holder of a Right
(except  Rights  which  previously  have been voided as set forth  above)  shall
thereafter  have the right to receive,  upon exercise,  that number of shares of
common stock of the  acquiring  company  which equals the exercise  price of the
Right  divided by one-half of the current  market  price of such common stock at
the date of the occurrence of the event.

     For  example,  at an  exercise  price of  $250.00  per  Right,  each  Right
following an event set forth in the preceding paragraph would entitle its holder
to purchase for $250.00  such number of shares of common stock of the  acquiring
company as equals  $250.00  divided by one-half of the current  market price (as
defined in the Rights Agreement) of such common stock. Assuming that such common
stock had a per share  value of $100.00  at such time,  the holder of each valid
Right would be entitled to purchase five shares of common stock of the acquiring
company for $250.00.

     At any time after the occurrence of a Section 11(a)(ii) Event, the Board of
Directors  of the Company may  exchange  the Rights  (other than Rights owned by
such  Acquiring  Person  that  have  become  void),  in whole or in part,  at an
exchange ratio of one share of Common Stock, or one ten-thousandth of a share of
Preferred  Stock (or of a share of a class or series of the Company's  preferred

                                      C-2
<PAGE>

stock having equivalent rights, preferences and privileges),  per Right (subject
to adjustment).

     The Purchase Price payable,  and the number of Units of Preferred  Stock or
other securities or property  issuable,  upon exercise of the Rights are subject
to adjustment from time to time to prevent  dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock,  (ii) if holders of the  Preferred  Stock are granted  certain  rights or
warrants to subscribe for Preferred Stock or convertible securities at less than
the current market price of the Preferred  Stock, or (iii) upon the distribution
to  holders  of the  Preferred  Stock of  evidences  of  indebtedness  or assets
(excluding  regular  quarterly  cash  dividends)  or of  subscription  rights or
warrants (other than those referred to above).

     The number of Rights  associated  with each  share of Common  Stock is also
subject to  adjustment  in the event of a stock  split of the Common  Stock or a
stock  dividend on the Common  Stock  payable in Common  Stock or  subdivisions,
consolidations  or  combinations  of Common Stock  occurring,  in any such case,
prior to the Distribution Date. As a result of the Company's three-for-two stock
split  in the form of a 50%  stock  dividend  in  1996,  the  number  of  Rights
associated  with each share of Common  Stock has been reduced from one Right per
share of Common Stock to two-thirds of a Right per share of Common Stock.

     Preferred  Stock  purchasable  upon  exercise  of the  Rights  will  not be
redeemable.  Each  share  of  Preferred  Stock  will be  entitled  to a  minimum
preferential  quarterly  dividend payment of $100 per share and will be entitled
to an  aggregate  dividend of 10,000  times the  dividend  declared per share of
Common Stock.  In the event of  liquidation,  the holders of the Preferred Stock
will be entitled to a minimum preferential liquidating payment of $100 per share
and will be entitled to an  aggregate  payment of 10,000  times the payment made
per share of Common Stock. Each share of Preferred Stock will have 10,000 votes,
voting  together  with the Common  Stock.  Finally,  in the event of any merger,
consolidation  or  other  transaction  in  which  Common  Stock  is  changed  or
exchanged,  each share of  Preferred  Stock will be entitled  to receive  10,000
times the amount received per share of Common Stock.  These rights are protected
by customary antidilution  provisions and, in accordance therewith,  in light of
the Company's  stock  dividend in 1996,  currently  provide for (i) an aggregate
dividend per share of Preferred Stock of 15,000 times the dividend  declared per
share of Common Stock,  (ii) an aggregate  payment per share of Preferred Stock,
in the event of  liquidation,  of 15,000  times  the  payment  made per share of
Common  Stock  and (iii)  15,000  votes per  share of  Preferred  Stock,  voting
together with the Common Stock.

     Because of the nature of the Preferred  Stock's  dividend,  liquidation and
voting rights,  the value of one  ten-thousandth  of a share of Preferred  Stock
purchasable  upon  exercise of each Right  should  approximate  the value of one
share of Common Stock.  With certain  exceptions,  no adjustment in the Purchase
Price will be required until cumulative adjustments amount to at least 1% of the
Purchase  Price.  No fractional  Units will be issued and, in lieu  thereof,  an
adjustment in cash will be made based on the market price of the Preferred Stock
on the last trading date prior to the date of exercise.

                                      C-3
<PAGE>

     At any time  until ten days  following  the  Stock  Acquisition  Date,  the
Company may redeem the Rights in whole,  but not in part, at a price of $.01 per
Right  (payable in cash or stock).  Immediately  upon the action of the Board of
Directors  ordering  redemption of the Rights, the Rights will terminate and the
only right of the  holders  of Rights  will be to  receive  the $.01  redemption
price. The Rights may also be redeemable  following certain other  circumstances
specified in the Rights Agreement.

     Until a Right is  exercised,  the  holder  thereof,  as such,  will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive  dividends.  While the distribution of the Rights will not
be taxable to stockholders or to the Company,  stockholders may,  depending upon
the circumstances,  recognize taxable income in the event that the Rights become
exercisable  for Common  Stock (or other  consideration)  of the  Company or for
common stock of the acquiring company as set forth above.

     Prior to the  Distribution  Date,  the terms of the Rights  are  subject to
amendment  by the Board of  Directors  without the consent of the holders of the
Rights,  except  that the  redemption  price of the  Rights  is not  subject  to
amendment.  After the  Distribution  Date,  only limited terms of the Rights are
subject to amendment by the Board.

     As long as the Rights are attached to the Common Stock,  one Right (as such
number may be adjusted pursuant to the provisions of the Rights Agreement) shall
be deemed to be delivered  for each share of Common Stock issued or delivered by
the  Company,  except  that  following  the  Distribution  Date and prior to the
expiration or redemption of the Rights,  the Company (a) shall issue Rights only
in respect of shares of common stock  issued upon the exercise of stock  options
or under any employee plan or arrangement,  or upon the exercise,  conversion or
exchange of securities issued before the Distribution Date and (b) may otherwise
issue Rights when it issues Common Stock only if the Board of Directors deems it
to be necessary or  appropriate;  provided  that no Rights will be issued if the
Company is advised by counsel that such issuance would create a significant risk
of material  adverse tax  consequences  to the Company or the  recipient  of the
Rights.

     A copy of the  Rights  Agreement  has been filed  with the  Securities  and
Exchange Commission as an Exhibit to a Registration  Statement on Form 8-A dated
January 25, 1996, as amended.  A copy of the Rights  Agreement is available free
of charge from the  Company.  This  summary  description  of the Rights does not
purport to be complete  and is  qualified  in its  entirety by  reference to the
Rights Agreement.

                                      C-4

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