Document:

Exhibit 4.01

 

AMENDED AND RESTATED

RIGHTS AGREEMENT

 

between

 

NEW FRONTIER MEDIA, INC.

 

and

 

CORPORATE STOCK TRANSFER, INC.,

 

as Rights Agent

 

Dated as of August 1, 2008

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 1.

  	
  Certain Definitions

  	
  1

  
	
  Section 2.

  	
  Appointment of Rights Agent

  	
  5

  
	
  Section 3.

  	
  Issuance of Rights
  Certificates

  	
  5

  
	
  Section 4.

  	
  Form of Rights
  Certificates

  	
  7

  
	
  Section 5.

  	
  Countersignature and
  Registration

  	
  8

  
	
  Section 6.

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

  	
  8

  
	
  Section 7.

  	
  Exercise of Rights; Purchase
  Price; Expiration Date of Rights

  	
  9

  
	
  Section 8.

  	
  Cancellation and Destruction
  of Rights Certificates

  	
  11

  
	
  Section 9.

  	
  Reservation and Availability
  of Preferred Stock

  	
  11

  
	
  Section 10.

  	
  Preferred Stock Record Date

  	
  13

  
	
  Section 11.

  	
  Adjustment of Purchase Price,
  Number and Kind of Shares or Number of Rights

  	
  13

  
	
  Section 12.

  	
  Certificate of Adjusted
  Purchase Price or Number of Shares

  	
  20

  
	
  Section 13.

  	
  Consolidation, Merger or Sale
  or Transfer of Assets, Cash Flow or Earning Power

  	
  20

  
	
  Section 14.

  	
  Fractional Rights and
  Fractional Shares

  	
  23

  
	
  Section 15.

  	
  Rights of Action

  	
  24

  
	
  Section 16.

  	
  Agreement of Rights Holders

  	
  24

  
	
  Section 17.

  	
  Rights Certificate Holder Not
  Deemed a Stockholder

  	
  25

  
	
  Section 18.

  	
  Concerning the Rights Agent

  	
  25

  
	
  Section 19.

  	
  Merger or Consolidation or
  Change of Name of Rights Agent

  	
  25

  
	
  Section 20.

  	
  Duties of Rights Agent

  	
  26

  
	
  Section 21.

  	
  Change of Rights Agent

  	
  28

  
	
  Section 22.

  	
  Issuance of New Rights
  Certificates

  	
  28

  
	
  Section 25.

  	
  Notice of Certain Events

  	
  31

  
	
  Section 26.

  	
  Notices

  	
  31

  
	
  Section 33.

  	
  Counterparts

  	
  34

  
	
  Section 34.

  	
  Descriptive Headings

  	
  34

  

 

APPENDICES

 

Appendix A —                           Form of
Certificate of Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock

 

Appendix B —          Form of
Rights Certificate

 

Appendix C —          Form of
Summary of Rights

 

i

 

AMENDED AND RESTATED

RIGHTS AGREEMENT

 

AMENDED AND RESTATED RIGHTS AGREEMENT, dated
as of August 1, 2008 (the “Agreement”), between NEW FRONTIER MEDIA, INC.,
a Colorado corporation (the “Company”), and CORPORATE STOCK TRANSFER, INC., a
Colorado corporation (the “Rights Agent”).

 

W I T N E S S E T H

 

WHEREAS, on November 29, 2001 (the “Rights
Dividend Declaration Date”), the Board of Directors of the Company (the “Board
of Directors”) authorized and declared a dividend distribution of one Right (as
hereinafter defined) for each share of common stock, par value $.0001 per
share, of the Company (the “Common Stock”) outstanding at the close of business
on December 21, 2001 (the “Record Date”), and has authorized the issuance
of one Right (as such number may hereinafter be adjusted pursuant to the
provisions of 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 Distribution Date (as
hereinafter defined), each Right initially representing the right to purchase
one one-thousandth of a share of Series A Junior Participating Preferred
Stock of the Company (the “Preferred Stock”) having the rights, powers and
preferences set forth in the form of Certificate of Designation, Preferences
and Rights attached hereto as Exhibit A, upon the terms and subject to the
conditions hereinafter set forth (the “Rights”); and

 

WHEREAS, on July 28, 2008, the Board of
Directors authorized amendments to the Rights Agreement, dated November 29,
2001 (the “Original Rights Agreement”), and the Company and the Rights Agent
desire to amend and restate the Original Rights Agreement, pursuant to the
terms of Section 27 thereof, to give effect to the amendments authorized
and approved by the Board of Directors.

 

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 fifteen percent (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, or any Person
or entity organized, appointed or established by the Company for or pursuant to
the terms of any such plan, (iv) any Person who, prior to November 29,
2001 became the Beneficial Owner of fifteen percent (15%) or more of the shares
of Common Stock then outstanding, unless such Person becomes the Beneficial
Owner of (x) one percent (1%) or more of the shares of Common Stock then
outstanding in excess of (y) the percentage of shares of Common Stock then
outstanding beneficially owned by such Person on (a) November 29,
2001 or (b) thereafter, whichever such percentage is less; provided that
the 

 

1

 

sum of the percentage referred to in clause (y) immediately
above, plus 1%, shall not be less than fifteen percent (15%); (v) any
Person who becomes the Beneficial Owner of fifteen percent (15%) or more of the
shares of Common Stock then outstanding as a result of a reduction in the
number of shares of Common Stock outstanding due to the repurchase of shares of
Common Stock by the Company unless and until such Person, after becoming aware
that such Person has become the Beneficial Owner of fifteen percent (15%) or
more of the then outstanding shares of Common Stock, acquires beneficial
ownership of additional shares of Common Stock representing one percent (1%) or
more of the shares of Common Stock then outstanding, or (vi) any such
Person who has reported or is required to report such ownership on Schedule 13G
under the Securities and Exchange Act of 1934, as amended and in effect on the
date of the Agreement (the “Exchange Act”) (or any comparable or successor
report) or on Schedule 13D under the Exchange Act (or any comparable or
successor report) which Schedule 13D does not state any intention to or reserve
the right to control or influence the management or policies of the Company or
engage in any of the actions specified in Item 4 of such schedule (other than
the disposition of the Common Stock) and, within 10 Business Days of being
requested by the Company to advise it regarding the same, certifies to the
Company that such Person acquired shares of Common Stock in excess of 14.9%
inadvertently or without knowledge of the terms of the Rights and who, together
with all Affiliates and Associates, thereafter does not acquire additional
shares of Common Stock while the Beneficial Owner of 15% or more of the shares
of Common Stock then outstanding; provided, however, that if the Person
requested to so certify fails to do so within 10 Business Days, then such
Person shall become an Acquiring Person immediately after such 10 Business Day
period. For all purposes of this Agreement, any calculation of the number of
shares of Common Stock outstanding at any time, including for purposes of
determining the percentage of such outstanding shares of Common Stock of which
any Person is the Beneficial Owner, shall be made in accordance with the
provisions of Rule 13d-3d(1)(i), as in effect on the date hereof, of the
General Rules and Regulations under the Exchange Act.

 

(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 Exchange Act.

 

(d)           A Person shall be
deemed the “Beneficial Owner” of, and shall be deemed to “beneficially own,”
any securities:

 

(i)            which such Person or
any of such Person’s Affiliates or Associates, directly or indirectly, 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
(whether or not in writing) or upon the exercise of conversion rights, exchange
rights, 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
such Person or any of such Person’s Affiliates or Associates until such
tendered securities are accepted for purchase or exchange, (B) securities
issuable upon exercise of Rights at any time prior to the occurrence of a
Triggering Event (as hereinafter defined), 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 

 

2

 

or Associates prior to the Distribution Date
(as hereinafter defined) 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)           which 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), including pursuant to any agreement, arrangement or
understanding, 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 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 (B) is not reportable by such
Person on Schedule 13D under the Exchange Act (or any comparable or successor
report); or

 

(iii)          which are beneficially
owned, directly or indirectly, by any other Person (or any Affiliate or
Associate thereof) with which such Person (or any of such Person’s Affiliates
or Associates) has any agreement, arrangement or understanding (whether or not
in writing), for the purpose of acquiring, holding, voting (except pursuant to
a revocable proxy as described in the provision to subparagraph (ii) of
this paragraph (d)) or disposing of any voting securities of the Company;
provided, however, that nothing in this paragraph (d) shall cause a Person
engaged in business as an underwriter of securities to be the “Beneficial Owner”
of, or to “beneficially own,” any securities acquired through such Person’s
participation in good faith in a firm commitment underwriting until the
expiration of forty days after the date of such acquisition, and then only if
such securities continue to be owned by such Person at such expiration of forty
days.

 

(e)           “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.

 

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

 

(g)           “Common Stock” shall
mean the common stock, par value $.0001 per share, 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.

 

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

 

(i)            “Current Market Price”
shall have the meaning set forth in Section 11(d)(i) hereof.

 

3

 

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

 

(k)           “Distribution Date”
shall have the meaning set forth in Section 3(a) hereof.

 

(l)            “Equivalent Preferred
Stock” shall have the meaning set forth in Section 11(b) hereof.

 

(m)          “Exchange Act” shall
mean the Securities and Exchange Act of 1934.

 

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

 

(o)           “Expiration Date” shall
have the meaning set forth in Section 7(a) hereof.

 

(p)           “Final Expiration Date”
shall have the meaning set forth in Section 7(a) hereof.

 

(q)           “Person” shall mean any
individual, firm, corporation, partnership or other entity.

 

(r)            “Preferred Stock”
shall mean shares of Series A Junior Participating Preferred Stock, par
value $0.01 per share, of the Company, and, to the extent that there are not a
sufficient number of shares of Series A Junior Participating Preferred
Stock authorized to permit the full exercise of the Rights, any other series of
preferred stock of the Company designated for such purpose containing terms
substantially similar to the terms of the Series A Junior Participating
Preferred Stock.

 

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

 

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

 

(u)           “Qualified Offer” shall
have the meaning set forth in Section 11(a)(ii) hereof.

 

(v)           “Record Date” shall
have the meaning set forth in the first WHEREAS clause at the beginning of this
Agreement.

 

(w)          “Rights” shall have the
meaning set forth in the first WHEREAS clause at the beginning of this
Agreement.

 

(x)            “Rights Agent” shall
have the meaning set forth in the parties clause at the beginning of this
Agreement.

 

(y)           “Rights Certificate”
shall have the meaning set forth in Section 3(a) hereof.

 

4

 

(z)            “Rights Dividend
Declaration Date” shall have the meaning set forth in the first WHEREAS clause
at the beginning of this Agreement.

 

(aa)         “Section 11(a)(ii) Event”
shall mean any event described in Section 11(a)(ii) hereof.

 

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

 

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

 

(dd)         “Stock Acquisition Date”
shall mean the first date of public announcement (which, for purposes of this
definition, shall include, without limitation, a report filed or amended
pursuant to Section 13(d) under the Exchange Act) by the Company or
an Acquiring Person that an Acquiring Person has become such other than
pursuant to a Qualified Offer.

 

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

 

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

 

(gg)         “Summary of Rights” shall
have the meaning set forth in Section 3(b) hereof.

 

(hh)         “Trading Day” shall have
the meaning set forth in Section 11(d)(i) hereof.

 

(ii)           “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.

 

Section 3.               Issuance
of Rights Certificates.

 

(a)           Until the earlier of (i) the
close of business on the tenth day after the Stock Acquisition Date (or, if the
tenth 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 the Board of Directors shall
determine) after the date that a tender or exchange offer by any Person (other
than the Company, any Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or pursuant to the 

 

5

 

terms of any such plan) is first published or
sent or given within the meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if upon consummation thereof, such Person
would become an Acquiring Person, in either instance other than pursuant to a
Qualified Offer (the earlier of (i) and (ii) being herein referred to
as the “Distribution Date”), (x) the Rights will be evidenced (subject to
the provisions of paragraph (b) of this Section 3) 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 right
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. In the event that an adjustment in
the number of Rights per share of Common Stock has been made pursuant to Section 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.

 

(b)           The Company will make
available, as promptly as practicable following the Record Date, a copy of a
Summary of Rights, in substantially the form attached hereto as Exhibit C
(the “Summary of Rights”) to any holder of Rights who may so request from time
to time prior to the Expiration Date. With respect to certificates for the
Common Stock outstanding as of the Record Date, until the Distribution Date (or
the earlier redemption, expiration or termination of the Rights), 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. Until the earlier of the Distribution Date (or the earlier
redemption, expiration or termination of the Rights), 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.

 

(c)           Rights shall be issued
in respect of all shares of Common Stock which are issued after the Record Date
but prior to the earlier of the Distribution Date or the redemption, expiration
or termination of the Rights. Certificates for Common Stock issued after the
Record Date but prior to the Distribution Date (or the earlier redemption,
expiration or termination of the Rights) representing such shares of Common
Stock shall also be deemed to be certificates for Rights, and shall bear the
following legend:

 

THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES
THE HOLDER HEREOF TO CERTAIN RIGHTS AS SET FORTH IN THE AMENDED AND RESTATED
RIGHTS AGREEMENT BETWEEN NEW FRONTIER MEDIA, INC. (THE “COMPANY”) AND THE
RIGHTS AGENT THEREUNDER (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 

 

6

 

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 Distribution Date (or the earlier redemption,
expiration or termination of the Rights), 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, and the transfer of any of such certificates shall
also constitute the transfer of the Rights associated with the Common Stock
represented by such certificates.

 

Section 4.               Form of
Rights Certificates.

 

(a)           The Rights Certificates
(and the forms of election to purchase and of 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 on which the Rights may from time to time be listed, or to
conform to usage. Subject to the provisions of Section 11 and Section 22
hereof, the Rights Certificates, whenever distributed, shall be dated as of the
Record Date and on their face shall entitle the holders thereof to purchase
such number of one one-thousandths of a share of Preferred Stock as shall be
set forth therein at the price set forth therein (such exercise price per one
one-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(a), Section 11(i) or Section 22
hereof that represents Rights beneficially owned by: (i) an Acquiring
Person or any Associate or Affiliate of an Acquiring Person, (ii) a
transferee of an Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee after the Acquiring Person becomes such, or (iii) a
transferee of an Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring Person
becoming such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with whom such
Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board of
Directors has determined is part of a plan, arrangement or understanding which
has as a primary purpose or effect avoidance of Section 7(e) hereof,
and any Rights Certificate issued pursuant to Section 6 or Section 11
hereof upon 

 

7

 

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 AMENDED AND RESTATED RIGHTS AGREEMENT). ACCORDINGLY,
THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL
AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(E) OF THE
AMENDED AND RESTATED RIGHTS AGREEMENT.

 

Section 5.               Countersignature
and Registration.

 

(a)           The Rights Certificates
shall be executed on behalf of the Company by its 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 countersigned by the
Rights Agent, either manually or by facsimile signature, 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 will keep, or cause to be kept, at its
principal office or offices 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 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 may 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
one-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 

 

8

 

entitles 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 at the principal office or offices 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 or the Rights Agent shall reasonably request.
Thereupon the Rights Agent shall, subject to Section 4(b), Section 7(e),
Section 14 hereof and Section 24 hereof, countersign and deliver to
the Person entitled thereto a Rights Certificate or Rights Certificates, as the
case may be, as so requested. The Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of Rights
Certificates.

 

(b)           Upon receipt by the
Company and the Rights Agent of evidence reasonably satisfactory to them of the
loss, theft, destruction or mutilation of a Rights Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably satisfactory to
them, and 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,
at any time after the Distribution Date 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(a) hereof) in whole or in part 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 principal
office or offices of the Rights Agent designated for such purpose, together
with payment of the aggregate Purchase Price with respect to the total number
of one one-thousandths of a share (or other securities, cash or other assets,
as the case may be) as to which such surrendered Rights are then exercisable,
at or prior to the earlier of (i) 5:00 P.M., New York City time, on December 21,
2011, or such later date as may be established by the Company, acting by
resolution of its Board of Directors prior to the expiration of the Rights
(such date, as it may be extended by the Board of Directors, (the “Final
Expiration Date”), or (ii) the time at which the Rights are redeemed or
exchanged as provided in Section 23 and Section 24 hereof (the
earlier of (i) and (ii) being herein referred to as the “Expiration
Date”).

 

(b)           The Purchase Price for
each one one-thousandth of a share of Preferred Stock pursuant to the exercise
of a Right shall initially be $10.00, and shall be subject to 

 

9

 

adjustment from time to time as provided in Section 11
and Section 13(a) hereof and shall be payable 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
one-thousandth of a share of Preferred Stock (or other shares, securities, cash
or other assets, as the case may be) to be purchased as set forth below and an
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 one-thousandths of a share of Preferred Stock to be
purchased and the Company hereby irrevocably authorizes its transfer agent to
comply with all such requests, or (B) if the Company shall have elected to
deposit the total number of 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 one-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 will direct
the depositary agent to comply with such request, (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)
shall be made in cash or by certified bank check or bank draft 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 will
make all arrangements necessary so that such other securities, cash and/or
other property are available for distribution by the Rights Agent, if and when
appropriate. The Company reserves the right to require prior to the occurrence
of a Triggering Event that, upon any exercise of Rights, a number of Rights be
exercised so that only whole shares of Preferred Stock would be issued.

 

(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 

 

10

 

Person or to any Person with whom the
Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board of
Directors has determined is part of a plan, arrangement or understanding which
has as a primary purpose or effect the avoidance of this Section 7(e),
shall become null and void without any further action and no holder of such
Rights shall have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The Company shall use all
reasonable efforts to 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 any 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 exercise as set forth in this Section 7
unless such registered holder shall have (i) completed and signed the
certificate contained in the form of election to purchase set forth on the
reverse side of the Rights Certificate surrendered for such exercise, and (ii) provided
such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company or the
Rights Agent 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 Preferred 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 Triggering Event, Common
Stock and/or other securities) issuable and deliverable upon the exercise of
the Rights may be listed on any national securities exchange, the Company shall
use its best efforts to cause, from and after such time as the Rights become
exercisable, all shares 

 

11

 

reserved for such issuance to be listed on
such exchange upon official notice of issuance upon such exercise.

 

(c)           The Company shall use
its best efforts to (i) file, as soon as practicable following the
earliest date after the first occurrence of a Section 11(a)(ii) Event
on which the consideration to be delivered by the Company upon exercise of the
Rights has been determined in accordance with Section 11(a)(iii) hereof,
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, and (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 date of the expiration 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, acting
by resolution of its Board of Directors, may temporarily suspend, for a period
of time not to exceed ninety (90) days after the date set forth in clause (i) of
the first sentence of this Section 9(c), the exercisability of the Rights
in order to prepare and file such registration statement and permit it to
become effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension has
been rescinded. In addition, if the Company shall determine that a registration
statement is required following the Distribution Date, the Company, acting by
resolution of its Board of Directors, may temporarily suspend the
exercisability of the Rights until such time as a registration statement has
been declared effective. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the requisite
qualification in such jurisdiction shall not have been obtained, the exercise
thereof shall not be permitted under applicable law, or a registration
statement shall not have been declared effective.

 

(d)           The Company covenants
and agrees that it will take all such action as may be necessary to ensure that
all one one-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 which may be payable in respect of the
issuance or delivery of the Rights Certificates and of any certificates for a
number of one one-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 to pay any transfer tax which may be
payable in respect of any transfer or delivery of Rights Certificates to a
Person other than, or the issuance or delivery of a number of one
one-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 Certificates evidencing Rights surrendered for
exercise or to issue or deliver any certificates for a number of one
one-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 

 

12

 

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
one-thousandths of a share of Preferred Stock (or Common Stock and/or other
securities, as the case may be) is issued upon the 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
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
shall not be entitled to any rights of a stockholder of the Company with
respect to shares for which the Rights shall be exercisable, including, without
limitation, the right to vote, 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, which, 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, such holder would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification. If an event occurs which 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.

 

13

 

(ii)           In the event any Person
shall, at any time after the Rights Dividend Declaration Date, become an
Acquiring Person, unless the event causing such Person to become an Acquiring
Person is a transaction set forth in Section 13(a) hereof, or is an
acquisition of shares of Common Stock pursuant to a tender offer or an exchange
offer for all outstanding shares of Common Stock at a price and on terms
determined by a majority of the members of the Board of Directors who are not
officers of the Company and who are not representatives, nominees, Affiliates
or Associates of an Acquiring Person, after receiving advice from one or more
investment banking firms, to be (a) at a price which is fair to
stockholders and not inadequate (taking into account all factors which such
members of the Board of Directors deem relevant, including, without limitation,
prices which 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 (a “Qualified Offer”)
then, promptly following the 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, upon exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement, in lieu
of a number of one one-thousandths of a share of Preferred Stock, such number
of shares of Common Stock of the Company as shall equal the result obtained by (x) multiplying
the then current Purchase Price by the then number of one one-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 which are authorized by the Company’s articles
of incorporation, but which are 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 value of the Adjustment Shares issuable upon the exercise of a Right (the “Current
Value”), and (B) with respect to each Right (subject to Section 7(e) hereof),
make adequate provision to substitute for the Adjustment Shares, upon the
exercise of a Right and payment of the applicable Purchase Price, (1) cash,
(2) a reduction in the Purchase Price, (3) preferred stock or other
equity securities of the Company which the Company, acting by resolution of its
Board of Directors, has deemed to have essentially the same value or economic
rights as shares of Common Stock (such shares of preferred stock being referred
to as “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 (less the amount of any reduction in the Purchase Price),
where such aggregate value has been determined by the Board of Directors,
acting by resolution of its Board of Directors, based upon the advice of an
independent investment banking firm selected by the Company, acting by
resolution of its Board of Directors; provided, however, that if the Company
shall not have made adequate provision to deliver value pursuant to clause (B) above
within thirty (30) days following the later of (x) the first occurrence of
a Section 11(a)(ii) Event and (y) the date on which the Company’s
right of redemption pursuant to Section 23(a) expires (the later of (x) and
(y) being referred to herein as the “Section 11(a)(ii) Trigger
Date”), then the Company shall be obligated to deliver, upon the surrender for
exercise of a Right and without requiring payment of the Purchase Price, 

 

14

 

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. For purposes of the preceding sentence,
the term “Spread” shall mean the excess of (i) the Current Value over (ii) the
Purchase Price. If the Company, acting by resolution of its Board of Directors
determines 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 thirty (30) day period set forth above may be extended to the
extent necessary, but not more than ninety (90) days after the Section 11(a)(ii) Trigger
Date, in order that the Company may seek shareholder approval for the
authorization of such additional shares (such thirty (30) day period, as it may
be extended, is herein called the “Substitution Period”). To the extent that
action is to be taken pursuant to the first and/or third sentences of this Section 11(a)(iii),
the Company, acting by resolution of its Board of Directors, (1) shall
provide, subject to Section 7(e) hereof, that such action shall apply
uniformly to all outstanding Rights, and (2) may suspend the
exercisability of the Rights until the expiration of the Substitution Period in
order to seek such shareholder approval for such 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 each
Adjustment Share shall be the current market price per share of the Common
Stock on the Section 11(a)(ii) Trigger Date and the per share or per
unit value of any Common Stock Equivalent shall be deemed to equal the current
market price per share of 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 forty-five (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 which 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 Company, acting by resolution of its Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent and
shall be binding on the Rights Agent and the holders of the Rights. Shares of
Preferred Stock owned by or held for the account of the Company shall not be
deemed 

 

15

 

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 or warrants are not so issued,
the Purchase Price shall be adjusted to be the Purchase Price which would then
be in effect if such record date had not been fixed.

 

(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 of 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 Company,
acting by resolution of its Board of Directors, whose determination shall be
described in a statement filed with the Rights Agent) of the portion of the
cash, assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to a 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. 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 which 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 thirty (30) consecutive Trading Days immediately prior to such date,
and for purposes of computations made pursuant to Section 11(a)(iii) hereof,
the Current 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 the
ex-dividend date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification shall not have occurred prior to
the commencement of the requisite thirty (30) Trading Day or ten (10) Trading
Day period, as set forth above, then, and in each such case, the Current Market
Price shall be properly adjusted to take into account ex-dividend 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 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 

 

16

 

national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low asked prices in
the over-the-counter market, as reported by the automated quotation system then
in use, or, if on any such date the shares of Common Stock are not so quoted,
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 Company,
acting by resolution of its Board of Directors. 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 as determined in good faith by the Board of Directors shall be used.
The term “Trading Day” shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading is open for the transaction of business or, if the shares of Common
Stock are not listed or admitted to trading on any national securities
exchange, a Business Day. 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 Company, acting by resolution of its
Board of Directors, 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 1,000 (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 Company,
acting by resolution of its Board of Directors, whose 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 a Unit shall be equal to the Current Market Price of one share of Preferred
Stock divided by 1,000.

 

(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
which by reason of this Section 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest cent
or to the nearest one one-thousandth of a share of Common Stock or other share
or one-millionth of a share of Preferred Stock, as the case may be.
Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
(3) years from the date of the transaction which 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 shares of capital stock other than Preferred Stock, thereafter the number
of such other shares 

 

17

 

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 shares.

 

(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 one-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 one-thousandths of a share of
Preferred Stock (calculated to the nearest one-millionth) obtained by (i) multiplying
(x) the number of one one-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
one-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 one-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
one-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall make a
public announcement of its election to adjust 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 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 

 

18

 

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 one-thousandths
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 one-thousandth of a share and the number of one
one-thousandths of a share which 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
stated value, if any, of the number of one one-thousandths of a share of
Preferred Stock issuable upon exercise of the Rights, the Company shall take
any corporate action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable such number of one one-thousandths of a share of 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 one-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
one-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, acting by resolution of its Board
of Directors, 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 it, in its good faith judgment, 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 which 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.

 

(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
which complies with Section 11(o) hereof), (ii) merge with or
into any other Person (other than a Subsidiary of the Company in a transaction
which 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, cash flow 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 

 

19

 

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 rights, warrants
or other instruments or securities outstanding or agreements in effect which
would substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights or (y) prior to, simultaneously with or immediately
after such consolidation, merger or sale, the shareholders 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 and Associates.

 

(o)           The Company covenants
and agrees that, after the Distribution Date, it will not, except as permitted
by Section 23 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 Rights Dividend Declaration Date and prior to the
Distribution Date (i) declare a 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 total number of shares of Common Stock outstanding
immediately prior to the occurrence of the event and the denominator of which
shall be the total 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 and Section 13 hereof, the Company shall (a) promptly
prepare a certificate setting forth such adjustment and a brief statement of
the facts accounting for such adjustment, (b) promptly 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) if a Distribution Date
has occurred, mail a brief summary thereof to each holder of a Rights
Certificate in accordance with Section 27 hereof. The Rights Agent shall
be fully protected in relying on any such certificate and on any adjustment
therein contained.

 

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

 

(a)           In the event that,
following the Distribution Date, directly or indirectly, (x) the Company
shall consolidate with, or merge with and into, any other Person (other than a
Subsidiary of the Company in a transaction which 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 which complies with Section 11(o) hereof)
shall consolidate with, or merge with or into, the Company, and the 

 

20

 

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, cash
flow or earning power aggregating more than 50% of the assets, cash flow 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 (except as may be 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), not 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 one-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 one-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 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 (2) 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 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 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, cash
flow or earning power transferred pursuant to such transaction or transactions;
provided, 

 

21

 

however, that in any such case, (1) if
the Common Stock of such Person is not at such time and 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; and (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.

 

(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 which 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; and

 

(ii)           take such other action
as may be necessary to enable the Principal Party to issue the securities
purchasable upon exercise of the Rights, including but not limited to the
registration or qualification of such securities under all requisite securities
laws of jurisdictions of the various states and the listing of such securities
on such exchanges and trading markets as may be necessary or appropriate; and

 

(iii)          will deliver to holders
of the Rights historical financial statements for the Principal Party and each
of its Affiliates which 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 any time
after the occurrence of a Section 11(a)(ii) Event, the Rights which
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 who acquired shares of Common Stock pursuant to a tender
offer or exchange offer for all outstanding shares of Common Stock which is a
Qualified Offer as such term is defined in Section 11(a)(ii) hereof
(or a wholly owned subsidiary of any such Person or Persons), (ii) the price
per share of Common Stock offered 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 tender offer or exchange offer and
(iii) the form of consideration being offered to the remaining holders of
shares of 

 

22

 

Common Stock pursuant to such transaction is
the same as the form of consideration paid pursuant to such tender offer or
exchange 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(p) hereof, or to distribute Rights
Certificates which evidence fractional Rights. In lieu of such fractional
Rights, the Company shall pay 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 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 low asked
prices in the over-the-counter market, as reported by the automated quotation
system then in use or, if on any such date the Rights are not so quoted, 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 Company, acting by
resolution of its Board of Directors. 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 Company, acting by resolution of its Board of
Directors shall be used.

 

(b)           The Company shall not
be required to issue fractions of shares of Preferred Stock (other than
fractions which are integral multiples of one one-thousandth of a share of
Preferred Stock) upon exercise of the Rights or to distribute certificates
which evidence fractional shares of Preferred Stock (other than fractions which
are integral multiples of one one-thousandth of a share of Preferred Stock). In
lieu of fractional shares of Preferred Stock that are not integral multiples of
one one-thousandth of a share of Preferred Stock, the Company may 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 one-thousandth of a share of Preferred Stock. For purposes
of this Section 14(b), the current market value of one one-thousandth of a
share of Preferred Stock shall be one one-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 which evidence fractional shares of Common Stock. In
lieu of fractional shares of Common Stock, the Company may 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 (1) share of Common Stock. For purposes of this Section 14(c),
the current market value of one share of Common Stock shall be the closing
price 

 

23

 

of one 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 the Rights 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 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 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 principal office or offices of the
Rights Agent designated for such purposes, duly endorsed or accompanied by a
proper instrument of transfer and with the appropriate forms and certificates
fully executed;

 

(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 last 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 

 

24

 

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 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 one-thousandths of a share of Preferred Stock or
any other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Rights Certificate be construed to confer upon the holder of any
Rights Certificate, as such, any of the rights of a stockholder of the Company
or any right to vote for the election of directors or upon any matter submitted
to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Rights Certificate shall have been exercised in accordance
with the provisions hereof.

 

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 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.

 

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, stock transfer
or other shareholder services 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 

 

25

 

further act on the part of any of the parties
hereto; but only if 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.

 

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 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 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.

 

26

 

(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 actual notice of any such adjustment);
nor shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any shares of 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.

 

(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 of
Directors, 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.

 

(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.

 

27

 

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

 

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 thirty (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, if such
resignation occurs after the Distribution Date, to the registered holders of
the Rights Certificates by first-class mail. The Company may remove the Rights
Agent or any successor Rights Agent upon thirty (30) days’ 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, if such removal occurs after the Distribution Date, to
the holders of the Rights Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the Company shall
fail to make such appointment within a period of thirty (30) days after giving
notice of such removal or after 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 legal business entity
organized and doing business under the laws of the United States or of the
State of New York or of any other state of the United States, in good standing,
which is authorized under such laws to exercise corporate trust or stock
transfer or shareholder services powers (b) an affiliate of a legal
business entity 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, if such appointment occurs after the Distribution
Date, 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 Company, acting by resolution of its Board of Directors, 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. In
addition, in connection with the issuance or sale of shares of Common Stock 

 

28

 

following the Distribution Date and prior to
the redemption or expiration of the Rights, the Company (a) shall, with
respect to shares of Common Stock so issued or sold pursuant to the exercise of
stock options or under any employee plan or arrangement, granted or awarded as
of the Distribution Date, or upon the exercise, conversion or exchange of
securities hereinafter issued by the Company, and (b) may, in any other
case, if deemed necessary or appropriate by the Company, acting by resolution
of its Board of Directors, issue Rights Certificates representing the
appropriate number of Rights in connection with such issuance or sale;
provided, however, that (i) no such Rights Certificate shall be issued 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 (ii) no such Rights Certificate shall be issued if, and to the extent
that, appropriate adjustment shall otherwise have been made in lieu of the
issuance thereof.

 

Section 23.             Redemption
and Termination.

 

(a)           The Company, acting by
resolution of its Board of Directors, 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 of the then outstanding Rights at a redemption price of $0.01 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”).

 

Notwithstanding anything
contained in this Agreement to the contrary, the Rights shall not be
exercisable after the first occurrence of a Section 11(a)(ii) Event
until such time as the Company’s right of redemption hereunder has expired. The
Company may, at its option, pay the Redemption Price in cash, shares of Common
Stock (based on the Current Market Price, as defined in Section 11(d)(i) hereof,
of the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Company, acting by resolution of its
Board of Directors.

 

(b)           Immediately upon the
action of the Company, acting by resolution of its Board of Directors, ordering
the redemption of the Rights, evidence of which shall have been filed with the
Rights Agent and without any further action and without any notice, the right
to exercise the Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price for each Right so
held. Promptly after the action of the Board of Directors ordering the
redemption of the Rights, the Company shall give notice of such redemption to
the Rights Agent and the holders of the then outstanding Rights by mailing such
notice to all such holders at 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 which is
mailed in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state the
method by which the payment of the Redemption Price will be made.

 

29

 

Section 24.             Exchange.

 

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

 

(b)           Immediately upon the
action of the Company ordering the exchange of any Rights pursuant to
subsection (a) of this Section 24 and without any further action and
without any notice, the right to exercise such Rights shall terminate and the
only right thereafter of a holder of such Rights shall be to receive that
number of shares of Common Stock equal to the number of such Rights held by
such holder multiplied by the Exchange Ratio. The Company shall promptly give
public notice of any such exchange; provided, however, that the failure to
give, or any defect in, such notice shall not affect the validity of such
exchange. The Company promptly shall mail a notice of any such exchange to all
of the holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the
exchange of the Common Stock for Rights will be effected and, in the event of
any partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights which have become 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
paragraph (b) of Section 11 hereof) for Common Stock exchangeable for
Rights, at the initial rate of one one-thousandth of a share of Preferred Stock
(or Equivalent Preferred Stock) for each share of Common Stock, as
appropriately adjusted to reflect stock splits, stock dividends and other
similar transactions after the date hereof.

 

(d)           In the event that there
shall not be sufficient shares of Common Stock issued but not outstanding or
authorized but unissued to permit any exchange of Rights as contemplated in
accordance with this Section 24, the Company shall take all such action as
may be necessary to authorize additional shares of Common 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 which evidence fractional shares of Common Stock. In lieu of such
fractional shares of Common Stock, there shall be paid to the registered
holders of the Rights Certificates with regard to which such fractional shares
of Common Stock would otherwise be issuable, an amount in cash equal to the
same fraction of the current market value 

 

30

 

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 of a 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 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
which 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, cash flow 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 twenty (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
twenty (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 any of the
events set forth in Section 11(a)(ii) hereof 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 to Common Stock and/or, if appropriate, other securities.

 

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 by the Rights Agent with the Company) as follows:

 

31

 

New Frontier Media, Inc.

7007 Winchester Circle, Suite 200

Boulder, Colorado  80301

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 by the Rights
Agent with the Company) as follows:

 

Corporate Stock Transfer

3200 Cherry Creek Drive South

Suite 430

Denver, Colorado 80209

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

 

32

 

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

 

Section 30.             Benefits
of this Agreement. 
Nothing in this Agreement shall be construed to give to any Person other
than the Company, the Rights Agent and the registered holders of the 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 Company, acting
by resolution of its Board of Directors, determines in its good faith judgment
that severing the invalid language from this Agreement would adversely affect
the purpose or effect of this Agreement, the right of redemption set forth in Section 23
hereof shall be reinstated and shall not expire until the close of business on
the tenth day following the date of such determination by the Board of
Directors.

 

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 Colorado and for
all purposes shall be governed by and construed in accordance with the laws of
such State applicable to contracts made and to be performed entirely within
such State.

 

33

 

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.

 

34

 

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

 

 

	
  Attest:

  	
   

  	
  NEW FRONTIER MEDIA, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Marc Callipari

  	
   

  	
  By:

  	
  /s/ Michael Weiner

  
	
  Name: 

  	
  Marc Callipari

  	
   

  	
  Name: 

  	
  Michael Weiner

  
	
  Title:

  	
  General Counsel

  	
   

  	
  Title:

  	
  Chief Executive Officer

  

 

 

	
  Attest:

  	
   

  	
  CORPORATE STOCK TRANSFER, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Stephanie Cooper

  	
   

  	
  By:

  	
  /s/ Carylyn Bell

  
	
  Name: 

  	
  Stephanie Cooper

  	
   

  	
  Name: 

  	
  Carylyn Bell

  
	
  Title:

  	
  Executive Assistant

  	
   

  	
  Title:

  	
  President

  

 

35

 

Appendix A

 

FORM OF

CERTIFICATE OF DESIGNATION, PREFERENCES AND

RIGHTS OF SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK

 

of

 

NEW FRONTIER MEDIA, INC.

 

Section 1.  Designation and Amount. The shares of such
series shall be designated as “Series A Junior Participating Preferred
Stock” and the number of shares constituting such series shall be 30,000.

 

Section 2.  Dividends and Distributions.

 

(A)  Subject to the prior and superior
rights of the holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series A Junior Participating
Preferred Stock with respect to dividends, the holders of shares of Series A
Junior Participating Preferred Stock shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of January,
April, July and October in each year (each such date being referred
to herein as a “Quarterly Dividend Payment Date”), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a share or fraction
of a share of Series A Junior Participating Preferred Stock, in an amount
per share (rounded to the nearest cent) equal to the greater of (a) $.01
or (b) subject to the provision for adjustment hereinafter set forth,
1,000 times the aggregate per share amount of all cash dividends, and 1,000
times the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock, par value $.0001
per share, of the Corporation (the “Common Stock”) since the immediately
preceding Quarterly Dividend Payment Date, or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Junior Participating Preferred Stock. In
the event the Corporation shall at any time after November 29, 2001 (the “Rights
Declaration Date”) (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of shares, then in each such
case the amount to which holders of shares of Series A Junior
Participating 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.

 

(B)  The Corporation shall declare a
dividend or distribution on the Series A Junior Participating Preferred
Stock as provided in Paragraph (A) above immediately 

 

Appendix A-1

 

after it declares a dividend or
distribution on the Common Stock (other than a dividend payable in shares of
Common Stock); 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 $0.01 per share on the Series A Junior Participating
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 A Junior Participating
Preferred Stock from the Quarterly Dividend Payment Date next preceding the
date of issue of such shares of Series A Junior Participating Preferred
Stock, unless the date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue from the date of issue of such shares, or unless
the date of issue is a Quarterly Dividend Payment Date or is a date after the
record date for the determination of holders of shares of Series A Junior
Participating Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series A Junior Participating Preferred Stock in an
amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series A Junior
Participating Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be no more than 30 days
prior to the date fixed for the payment thereof.

 

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

 

(A)  Subject to the provision for adjustment hereinafter set
forth, each share of Series A Junior
Participating Preferred Stock shall entitle the holder thereof to 1,000 votes
on all matters submitted to a vote of the stockholders of the Corporation. In
the event the Corporation shall at any time after the Rights Declaration Date (i) declare
any dividend on Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the number of
votes per share to which holders of shares of Series A Junior
Participating 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.

 

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

 

Appendix A-2

 

(C)  (i) If at any time dividends
on any Series A Junior Participating Preferred Stock shall be in arrears
in an amount equal to six (6) quarterly dividends thereon, the occurrence
of such contingency shall mark the beginning of a period (herein called a “default
period”) which shall extend until such time when all accrued and unpaid
dividends for all previous quarterly dividend periods and for the current
quarterly dividend period on all shares of Series A Junior Participating
Preferred Stock then outstanding shall have been declared and paid or set apart
for payment. During each default period, all holders of Preferred Stock
(including holders of the Series A Junior Participating Preferred Stock)
with dividends in arrears in an amount equal to six (6) quarterly
dividends thereon, voting as a class, irrespective of series, shall have the
right to elect two (2) directors.

 

(ii) During any default
period, such voting right of the holders of Series A Junior Participating
Preferred Stock may be exercised initially at a special meeting called pursuant
to subparagraph (iii) of this Section 3(C) or at any annual
meeting of stockholders, and thereafter at annual meetings of stockholders,
provided that neither such voting right nor the right of the holders of any
other series of Preferred Stock, if any, to increase, in certain cases, the
authorized number of directors shall be exercised unless the holders of fifteen
percent (15%) in number of shares of Preferred Stock outstanding shall be
present in person or by proxy. The absence of a quorum of the holders of Common
Stock shall not affect the exercise by the holders of Preferred Stock of such
voting right. At any meeting at which the holders of Preferred Stock shall
exercise such voting right initially during an existing default period, they
shall have the right, voting as a class, to elect directors to fill such
vacancies, if any, in the Board of Directors as may then exist up to two (2) directors
or, if such right is exercised at an annual meeting, to elect two (2) directors.
If the number which may be so elected at any special meeting does not amount to
the required number, the holders of the Preferred Stock shall have the right to
make such increase in the number of directors as shall be necessary to permit
the election by them of the required number. After the holders of the Preferred
Stock shall have exercised their right to elect directors in any default period
and during the continuance of such period, the number of directors shall not be
increased or decreased except by vote of the holders of Preferred Stock as
herein provided or pursuant to the rights of any equity securities ranking
senior to or pari passu with the Series A Junior Participating Preferred
Stock.

 

(iii)  Unless the holders
of Preferred Stock shall, during an existing default period, have previously
exercised their right to elect directors, the Board of Directors may order, or
any stockholder or stockholders owning in the aggregate not less than fifteen
percent (15%) of the total number of shares of Preferred Stock outstanding,
irrespective of series, may request, the calling of a special meeting of the
holders of Preferred Stock, which meeting shall thereupon be called by the
President, a Vice-President or the Secretary of the Corporation. Notice of such
meeting and of any annual meeting at which holders of Preferred Stock are
entitled to vote pursuant to this Paragraph (C)(iii) shall be given to
each holder of record of Preferred Stock by mailing a copy of such notice to
him at his last address as the same appears on the books of the Corporation.
Such meeting shall be called for a time not earlier than 20 days and not later
than 60 days after such order or request or in default of the calling of such
meeting within 

 

Appendix A-3

 

60 days after such order or
request, such meeting may be called on similar notice by any stockholder or
stockholders owning in the aggregate not less than fifteen percent (15%) of the
total number of shares of Preferred Stock outstanding. Notwithstanding the
provisions of this Paragraph (C)(iii), no such special meeting shall be called
during the period within 60 days immediately preceding the date fixed for the
next annual meeting of the stockholders.

 

(iv)  In
any default period, the holders of Common Stock, and other classes of stock of
the Corporation if applicable, shall continue to be entitled to elect the whole
number of directors until the holders of Preferred Stock shall have exercised
their right to elect two (2) directors voting as a class, after the
exercise of which right (x) the directors so elected by the holders of
Preferred Stock shall continue in office until their successors shall have been
elected by such holders or until the expiration of the default period, and (y) any
vacancy in the Board of Directors may (except as provided in Paragraph (C)(ii) of
this Section 3) be filled by vote of a majority of the remaining directors
theretofore elected by the holders of the class of stock which elected the
director whose office shall have become vacant. References in this Paragraph (C) to
directors elected by the holders of a particular class of stock shall include
directors elected by such directors to fill vacancies as provided in clause (y) of
the foregoing sentence.

 

(v)  Immediately upon the
expiration of a default period, (x) the right of the holders of Preferred
Stock as a class to elect directors shall cease, (y) the term of any
directors elected by the holders of Preferred Stock as a class shall terminate,
and (z) the number of directors shall be such number as may be provided
for in the articles of incorporation or by-laws irrespective of any increase
made pursuant to the provisions of Paragraph (C)(ii) of this Section 3
(such number being subject, however, to change thereafter in any manner
provided by law or in the articles of incorporation or by-laws). Any vacancies
in the Board of Directors effected by the provisions of clauses (y) and (z) in
the preceding sentence may be filled by a majority of the remaining directors.

 

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

 

Section 4.  Certain Restrictions.

 

(A)  Whenever quarterly dividends or
other dividends or distributions payable on the Series A Junior
Participating 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 A Junior Participating Preferred Stock
outstanding shall have been paid in full, the Corporation shall not

 

(i)  declare or pay dividends on, make
any other distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock;

 

Appendix A-4

 

(ii)  declare or pay dividends on 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 A
Junior Participating Preferred Stock, except dividends paid ratably on the Series A
Junior Participating Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;

 

(iii)  redeem or purchase or otherwise
acquire for consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Junior Participating Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such parity 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 A
Junior Participating Preferred Stock; or

 

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

 

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

 

Section 5. Reacquired Shares.  Any shares of Series A Junior
Participating 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 to be created by resolution or
resolutions of the Board of Directors, subject to the conditions and
restrictions on issuance set forth herein.

 

Section 6.  Liquidation, Dissolution or Winding Up.  (A) Upon any liquidation (voluntary or
otherwise), dissolution or winding up of the Corporation, no distribution shall
be made to the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series A
Junior Participating Preferred Stock unless, prior thereto, the holders of
shares of Series A Junior Participating Preferred Stock shall have
received an amount equal to $1,000 per share of Series A Participating
Preferred Stock, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment
(the “Series A Liquidation Preference”). Following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions
shall be made to the holders of shares of Series A Junior Participating
Preferred Stock unless, prior thereto, the holders of shares 

 

Appendix A-5

 

of Common
Stock shall have received an amount per share (the “Common Adjustment”) equal
to the quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 1,000 (as appropriately adjusted as set forth in
subparagraph (C) below to reflect such events as stock splits, stock
dividends and recapitalizations with respect to the Common Stock) (such number
in clause (ii), the “Adjustment Number”). Following the payment of the full
amount of the Series A Liquidation Preference and the Common Adjustment in
respect of all outstanding shares of Series A Junior Participating
Preferred Stock and Common Stock, respectively, holders of Series A Junior
Participating Preferred Stock and holders of shares of Common Stock shall
receive their ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with respect to such
Preferred Stock and Common Stock, on a per share basis, respectively.

 

(B)  In the event, however, that there
are not sufficient assets available to permit payment in full of the Series A
Liquidation Preference and the liquidation preferences of all other series of
preferred stock, if any, which rank on a parity with the Series A Junior
Participating Preferred Stock, then such remaining assets shall be distributed
ratably to the holders of such parity shares in proportion to their respective
liquidation preferences. In the event, however, that there are not sufficient
assets available to permit payment in full of the Common Adjustment, then such
remaining assets shall be distributed ratably to the holders of Common Stock.

 

(C)  In the event the Corporation shall
at any time after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the Adjustment Number
in effect immediately prior to such event shall be adjusted by multiplying such
Adjustment 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.

 

Section 7. Consolidation, Merger,
etc.  In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Junior Participating Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to the provision
for adjustment hereinafter set forth) equal to 1,000 times the aggregate amount
of stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of shares, then in each such
case the amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Junior Participating Preferred
Stock shall be adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.

 

Appendix A-6

 

Section 8.  No Redemption.  The shares of Series A Junior
Participating Preferred Stock shall not be redeemable.

 

Section 9.  Ranking. 
The Series A Junior Participating Preferred Stock shall rank junior
to all other series of the Corporation’s Preferred Stock as to the payment of
dividends and the distribution of assets, unless the terms of any such series
shall provide otherwise.

 

Section 10.  Amendment. 
At any time when any shares of Series A Junior Participating
Preferred Stock are outstanding, neither the Amended and Restated Articles of
Incorporation of the Corporation nor this Certificate of Designation shall be
amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series A Junior Participating
Preferred Stock so as to affect them adversely without the affirmative vote of
the holders of a majority of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a class.

 

Section 11.  Fractional Shares.  Series A Junior Participating Preferred
Stock may be issued in fractions that are integral multiples of one
one-thousandth of a share which shall entitle the holder, in proportion to such
holder’s fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.

 

Appendix A-7

 

Appendix B

 

[Form of Rights Certificate]

 

	
  Certificate No. R-

  	
   

  	
  Rights

  

 

NOT EXERCISABLE AFTER DECEMBER 21, 2011 UNLESS EXTENDED PRIOR THERETO
BY THE COMPANY, ACTING BY RESOLUTION OF ITS BOARD OF DIRECTORS, OR EARLIER IF
REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF
THE COMPANY, ACTING BY RESOLUTION OF ITS BOARD OF DIRECTORS, AT $0.01 PER RIGHT
ON THE TERMS SET FORTH IN THE AMENDED AND RESTATED RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS
SUCH TERM IS DEFINED IN THE AMENDED AND RESTATED 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 AMENDED AND RESTATED 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.]*

 

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

 

Rights Certificate

 

NEW FRONTIER MEDIA, INC.

 

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 Amended and Restated Rights Agreement, dated
as of August 1, 2008 (the “Rights Agreement”), between NEW FRONTIER MEDIA,
INC., a Colorado corporation (the “Company”), and CORPORATE STOCK TRANSFER,
INC., a Colorado corporation (the “Rights Agent”), to purchase from the Company
at any time prior to 5:00 P.M. (New York City time) on December 21,
2011 (unless such date is extended prior thereto by the Board of Directors on
the terms set forth in the Rights Agreement) at the office or offices of the
Rights Agent designated for such purpose, or its successors as Rights Agent,
one one-thousandth of a fully paid, non-assessable share of Series A
Junior Participating Preferred Stock (the “Preferred Stock”) of the Company, at
a purchase price of $10.00 per one one-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 shares which may
be purchased upon exercise thereof) set forth above, and the Purchase Price per
share set forth above, are the number and Purchase Price as of November 29,
2001, based on the Preferred 

 

Appendix B-1

 

Stock as
constituted at such date. The Company reserves the right to require prior to
the occurrence of a Triggering Event (as such term is defined in the Rights
Agreement) that a number of Rights be exercised so that only whole shares of
Preferred Stock will be issued.

 

Upon the occurrence of a Section 11(a)(ii) Event
(as such term is defined in the Rights Agreement), 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, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a person who, 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 Triggering 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 above-mentioned office of the Rights Agent and are also
available upon written request to the Rights Agent.

 

This Rights Certificate, with or without
other Rights Certificates, upon surrender at the principal office or offices of
the Rights Agent designated for such purpose, 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
one-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, acting by resolution of its Board of Directors at a redemption price
of $0.01 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. In addition, under certain circumstances following the
Stock Acquisition Date, the Rights may be exchanged, in whole or in part, for
shares of the Common Stock, or shares of preferred stock of the Company having
essentially the same value or economic rights as such shares. Immediately upon
the action of the Board of Directors of the Company, acting by resolution,
authorizing any such exchange, and without any further action or any notice,
the Rights (other than Rights which are not subject to 

 

Appendix B-2

 

such exchange)
will terminate and the Rights will only enable holders to receive the shares
issuable upon such exchange.

 

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 one-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. The Company, at its election, may require
that a number of Rights be exercised so that only whole shares of Preferred
Stock would be issued.

 

No holder of this Rights Certificate 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 consent to or withhold consent
from 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
                              ,        

 

	
   

  	
  NEW FRONTIER MEDIA, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

	
  Countersigned:

  	
   

  
	
   

  	
   

  
	
  CORPORATE STOCK TRANSFER

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Authorized Signature

  	
   

  

 

Appendix B-3

 

[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 by checking
the appropriate boxes that:

 

(1) this Rights Certificate [ ] is [ ]
is not being sold, assigned and transferred by or on behalf of a Person who is
or was an Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (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
subsequently became an Acquiring Person or an Affiliate or Associate of an
Acquiring Person.

 

Dated:
                                    ,

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature

  
	
   

  	
   

  	
   

  
	
  Signature Guaranteed:

  	
   

  	
   

  

 

NOTICE

 

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

 

Appendix B-4

 

FORM OF ELECTION TO PURCHASE

 

(To be executed if holder desires to exercise
Rights

represented by the Rights Certificate.)

 

To: NEW FRONTIER MEDIA, INC.

 

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:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  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 of any such
Acquiring Person (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 of an Acquiring Person.

 

Dated:
                                    ,

 

Appendix B-5

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  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.

 

Appendix B-6

 

Appendix C

 

SUMMARY OF RIGHTS TO PURCHASE

PREFERRED STOCK

 

On November 29, 2001, the Board of
Directors of NEW FRONTIER MEDIA, INC. (the “Company”) declared a dividend
distribution of one Right for each outstanding share of Company Common Stock to
stockholders of record at the close of business on December 21, 2001 (the “Record
Date”). Each Right entitles the registered holder to purchase from the Company
one one-thousandth of a share (“Unit”) of Series A Junior Participating
Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”)
at a Purchase Price of $10.00 per Unit, subject to adjustment. The description
and terms of the Rights are set forth in an Amended and Restated Rights
Agreement (the “Rights Agreement”) between the Company and Corporate Stock
Transfer, Inc., 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. Subject to certain exceptions
specified in the Rights Agreement, 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 beneficial ownership of
15% or more of the outstanding shares of Common Stock after November 29,
2001 (the “Stock Acquisition Date”), other than as a result of repurchases of
stock by the Company or certain inadvertent actions by institutional or certain
other stockholders or (ii) 10 business days (or such later date as the
Board of Directors shall determine) following the commencement of a tender
offer or exchange offer that would result in a person or group becoming an
Acquiring Person. 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 issued after the Record Date 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.
Pursuant to the Rights Agreement, the Company reserves the right to require
prior to the occurrence of a Triggering Event (as defined below) that, upon any
exercise of Rights, a number of Rights be exercised so that only whole shares
of Preferred Stock will be issued.

 

The Rights are not exercisable until the
Distribution Date and will expire at 5:00 P.M. (New York City time) on December 21,
2011, unless such date is extended or the Rights are earlier redeemed or
exchanged by the Company as described below. 
If there were to be a 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, only shares of Common Stock issued prior to the Distribution Date
will be issued with Rights.

 

In the event that a Person becomes an
Acquiring Person, except pursuant to an offer for all outstanding shares of
Common Stock which the independent directors determine to be fair and not
inadequate to and to otherwise be in the best interests of the Company and its 

 

Appendix C-1

 

stockholders,
after receiving advice from one or more investment banking firms (a “Qualified
Offer”), each holder of a Right will thereafter have the right to receive, upon
exercise, Common Stock (or, in certain circumstances, cash, property or other
securities of the Company) having a value equal to two times the exercise price
of the Right. Notwithstanding any of the foregoing, following the occurrence of
the event set forth in this paragraph, 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. However, Rights are not exercisable
following the occurrence of the event set forth above until such time as the
Rights are no longer redeemable by the Company as set forth below.

 

For example, at an exercise price of $10 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 $20 worth of Common Stock (or other consideration, as
noted above) for $10. Assuming that the Common Stock had a per share value of
$5 at such time, the holder of each valid Right would be entitled to purchase
four shares of Common Stock for $10.

 

In the event that, at any time following the
Stock Acquisition Date, (i) the Company engages in a merger or other
business combination transaction in which the Company is not the surviving
corporation (other than with an entity which acquired the shares pursuant to a
Qualified Offer), (ii) the Company engages in a merger or other business
combination transaction in which the Company is the surviving corporation and
the Common Stock of the Company is changed or exchanged, or (iii) 50% or
more of the Company’s assets, cash flow or earning power is sold or
transferred, each holder of a Right (except Rights which have previously been
voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the exercise price of the Right. The events set forth in this paragraph
and in the second preceding paragraph are referred to as the “Triggering
Events.”

 

At any time after a person becomes an
Acquiring Person and prior to the acquisition by such person or group of fifty
percent (50%) or more of the outstanding Common Stock, the Company may exchange
the Rights (other than Rights owned by such person or group which have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or one one-thousandth of a share of Preferred Stock (or of a share of a class
or series of the Company’s preferred stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment).

 

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 $0.01 per Right (payable in cash, Common Stock or other
consideration deemed appropriate by the Board of Directors). 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 $0.01 redemption price.

 

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 

 

Appendix C-2

 

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 or in the event of the redemption of
the Rights as set forth above.

 

Any of the provisions of the Rights Agreement
may be amended by the Company prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be amended by the
Board of Directors in order to cure any ambiguity, to make changes which do not
adversely affect the interests of holders of Rights, or to shorten or lengthen
any time period under the Rights Agreement. The foregoing notwithstanding, no
amendment may be made at such time as the Rights are not redeemable.

 

A copy of the Rights Agreement is being filed
with the Securities and Exchange Commission as an Exhibit to a
Registration Statement on Form 8-A. A copy of the Rights Agreement is
available free of charge from the Rights Agent or the Secretary of the Company
including by means of internet posting or other electronic distribution. In
addition, the Securities and Exchange Commission maintains a web site
(http://www.sec.gov) that contains the Company’s Form 8-A and other
information regarding 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, which is incorporated herein by reference.

 

Appendix C-3EXHIBIT
10.1

 

EXECUTION
VERSION

 

INCREMENTAL
REVOLVER SUPPLEMENT

 

THIS INCREMENTAL REVOLVER SUPPLEMENT is dated as of June 3,
2008, by and among RAINBOW NATIONAL SERVICES LLC, a Delaware limited liability
company (the “Company”), the banks which are parties hereto (together
with their respective successors and assigns, each an “Incremental Revolver
Lender (June 2008)” and collectively, the “Incremental Revolver
Lenders (June 2008)”) and JPMORGAN CHASE BANK, N.A., as administrative
agent (the “Administrative Agent”).

 

WHEREAS, the Company, certain of its subsidiaries
named therein, the several banks whose names are set forth on the signature pages thereof,
and the Administrative Agent are parties to that certain Credit Agreement,
dated as of July 5, 2006 (as amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “Credit
Agreement”; unless otherwise defined herein, all capitalized terms used in
this Incremental Revolver Supplement shall have the meanings ascribed thereto
in the Credit Agreement), which Credit Agreement grants the Company, the
Incremental Revolver Lenders (June 2008) and the Administrative Agent an
option to establish a separate tranche of commitments and loans subject, among other things, to the
execution and delivery of an Incremental Facility Supplement; and

 

WHEREAS, this Incremental Revolver Supplement is an “Incremental
Facility Supplement” as such term is defined in the Credit Agreement.

 

NOW, THEREFORE, pursuant to Section 2.14 of the
Credit Agreement, and in consideration of the mutual covenants and agreements
herein contained, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto covenant and agree as follows:

 

1.                                       Definitions. 
As used herein, the following terms shall have the following meanings:

 

(a)                                  “Applicable Incremental Revolver
Percentage (June 2008)” means with respect to any Incremental Revolver
Lender (June 2008) at any time, such Incremental Revolver Lender (June 2008)’s
Applicable Percentage in respect of the Incremental Revolver Facility (June 2008)
at such time.

 

(b)                                 “Availability Period (June 2008)”
means in respect of the Incremental Revolver Facility (June 2008), the
period from and including the Incremental Revolver Facility Closing Date to the
earliest of (i) Incremental Revolver Facility (June 2008) Maturity
Date, (ii) the date of termination of the Incremental Revolver Commitments
(June 2008) pursuant to Section 7 of this Incremental Revolver
Supplement, and (iii) the date on which the commitments of the Incremental
Revolver Lenders (June 2008) are terminated in accordance with the
provisions of Section 8.02 of the Credit Agreement.

 

 

(c)                                  “Eligible Assignee” means, with
respect to any assignment of any Incremental Revolver Commitment (June 2008)
or Incremental Revolver Loan (June 2008), (a) an Incremental Revolver
Lender (June 2008), (b) a Revolving Credit Lender, (c) an
Affiliate of an Incremental Revolver Lender (June 2008) or a Revolving
Credit Lender, and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, and (ii) unless an Event of
Default has occurred and is continuing, the Company (each such approval not to
be unreasonably withheld or delayed); provided that, in each case,
notwithstanding the foregoing, “Eligible Assignee” shall not include the
Company or any of the Company’s Affiliates or Subsidiaries.

 

(d)                                 “Incremental Revolver Borrowing (June 2008)”
means an Incremental Facility Borrowing with respect to the Incremental
Revolver Facility (June 2008).

 

(e)                                  “Incremental Revolver Commitment (June 2008)”
means, as to each Incremental Revolver Lender (June 2008), its Incremental
Facility Commitment (June 2008) in respect of the Incremental Revolver
Facility (June 2008), each of which is an “Incremental Facility Commitment”
as such term is defined in the Credit Agreement.  The initial Incremental Revolver Commitment (June 2008)
of each Incremental Revolver Lender (June 2008) is set forth opposite such
Incremental Revolver Lender (June 2008)’s name on Schedule I hereto
under the caption “Incremental Revolver Commitment (June 2008)” or
opposite such caption in the Assignment and Assumption pursuant to which such
Incremental Revolver Lender (June 2008) Lender becomes a party to the
Credit Agreement, as applicable, as such amount may be adjusted from time to
time in accordance with this Incremental Revolver Supplement and the Credit
Agreement.

 

(f)                                    “Incremental Revolver Facility (June 2008)”
means the Incremental Facility established pursuant to this Incremental
Revolver Supplement and Section 2.14 of the Credit Agreement.

 

(g)                                 “Incremental Revolver Facility (June 2008)
Closing Date” means June [3], 2008, which is the “Incremental Facility
Closing Date” (as such term is defined in the Credit Agreement) in respect of
the Incremental Revolver Facility (June 2008).

 

(h)                                 “Incremental Revolver Facility (June 2008)
Maturity Date” means June 30, 2012, which date is the “Maturity Date”
(as such term is defined in the Credit Agreement) for the Incremental Revolver
Facility (June 2008).

 

(i)                                     “Incremental Revolver Loan (June 2008)”
has the meaning set forth in Section 2 hereof, each of which is an “Incremental
Facility Loan” and a “Loan” as those terms are defined in the Credit Agreement.

 

(j)                                     “Incremental Revolver Lender (June 2008)”
means any Incremental Facility Lender with respect to the Incremental Revolver
Facility (June 2008), each of which is an “Incremental Facility Lender”
and a “Lender” as those terms are defined in the Credit Agreement.

 

2

 

(k)                                  “Total Incremental Revolver
Outstandings (June 2008)” means the aggregate Outstanding Amount of
all Incremental Revolver Loans (June 2008).

 

2.                                       Incremental Revolver Borrowings (June 2008). 
Subject to the terms and conditions set forth herein and in the Credit
Agreement, each Incremental Revolver Lender (June 2008) severally agrees
to make loans (each such loan, an “Incremental Revolver Loan (June 2008)”)
to the Company from time to time on any Business Day during the Availability
Period (June 2008), in an aggregate amount not to exceed at any time
outstanding the amount of such Lender’s Incremental Revolver Commitment (June 2008);
provided, however, that after giving effect to any Incremental
Revolver Borrowing (June 2008), (i) the Total Incremental Revolver
Outstandings (June 2008) shall not exceed the Incremental Revolver
Facility (June 2008), and (ii) the aggregate Outstanding Amount of
the Incremental Revolver Loans (June 2008) of any Incremental Revolver
Lender (June 2008) shall not exceed such Incremental Revolver Lender (June 2008)’s
Incremental Revolver Commitment (June 2008).  Within the limits of each Incremental
Revolver Lender (June 2008)’s Incremental Revolver Commitment (June 2008),
and subject to the other terms and conditions of this Incremental Revolver
Supplement and the Credit Agreement, the Company may borrow, prepay, and
re-borrow Incremental Revolver Loans (June 2008)  in accordance with this Incremental Revolver
Supplement and the Credit Agreement. 
Incremental Revolver Loans (June 2008) may be Base Rate Loans or
Eurodollar Rate Loans as further provided herein or in the Credit Agreement.

 

3.                                       Borrowing, Conversions and Continuations
of Incremental Revolver Loans (June 2008).  Each
Incremental Revolver Borrowing (June 2008), each conversion of Incremental
Revolver Loans (June 2008) from one Type to the other, and each
continuation of Eurodollar Rate Loans in respect of the Incremental Revolver
Facility (June 2008) shall be made in the same manner as set forth in Section 2.02
of the Credit Agreement with regard to Revolving Credit Borrowings and
Revolving Credit Loans except as set forth herein or as the context otherwise
requires.  After giving effect to all
Incremental Revolver Borrowings (June 2008), all conversions of
Incremental Revolver Loans (June 2008) from one Type to the other, and all
continuations of Incremental Revolver Loans (June 2008) as the same Type,
there shall not be more than twelve (12) Interest Periods in effect in respect
of the Incremental Revolver Facility (June 2008).

 

4.                                       Repayment of Incremental Revolver Loans (June 2008). 
The Company shall repay to the Incremental Revolver Lenders (June 2008)
on the Incremental Revolver Facility (June 2008) Maturity Date the
aggregate principal amount of all Incremental Revolver Loans (June 2008)
outstanding on such date.  Any unpaid
principal and interest of the Incremental Revolver Loans (June 2008) and
any other outstanding Obligations under any of the Incremental Revolver
Commitments (June 2008) shall be due and payable in full on the
Incremental Revolver Facility (June 2008) Maturity Date as set forth
herein.

 

5.                                       Optional Prepayments. 
The Company may, upon notice to the Administrative Agent, at any time or
from time to time voluntarily prepay Incremental Revolver Loans (June 2008)
in whole or in part without premium or penalty in the same manner as set forth
in Section 2.04(a) of the Credit Agreement with regard to Revolving
Credit Loans.

 

3

 

6.                                       Mandatory Prepayments. 
The Company shall make mandatory prepayments of the Incremental Revolver
Loans (June 2008) in accordance with the provisions of Section 2.04(b) of
the Credit Agreement.  Each prepayment of
Loans pursuant to the provisions of Section 2.04(b) of the Credit
Agreement shall be applied, first, ratably to the Term A Facility and to the
principal repayment installments thereof on a pro-rata basis and, second, on a
pro rata basis, to the aggregate of (i) the Revolving Credit Facility in
the manner set forth in clause (vi) of Section 2.04(b) of the
Credit Agreement, and (ii) the Incremental Revolver Facility (June 2008).  In addition, if for any reason the Total
Incremental Revolver Outstandings (June 2008) at any time exceed the
Incremental Revolver Facility (June 2008) at such time, the Company shall
immediately prepay Incremental Revolver Loans (June 2008) in an aggregate
amount equal to such excess.

 

7.                                       Termination or Reduction of Incremental
Revolver Commitments (June 2008).  The Company
may, upon notice to the Administrative Agent, terminate the Incremental
Revolver Facility (June 2008), or from time to time permanently reduce the
Incremental Revolver Facility (June 2008); provided that (i) any such
notice shall be received by the Administrative Agent not later than 11:00 a.m.
five Business Days prior to the date of termination or reduction, (ii) any
such partial reduction shall be in an aggregate amount of $5,000,000 or any
whole multiple of $1,000,000 in excess thereof and (iii) the Company shall
not terminate or reduce the Incremental Revolver Facility (June 2008) if,
after giving effect thereto and to any concurrent prepayments made under this
Incremental Revolver Supplement or the Credit Agreement, the Total Incremental
Revolver Outstandings (June 2008) would exceed the Incremental Revolver
Facility (June 2008).  The
Administrative Agent will promptly notify the Incremental Revolver Lenders (June 2008)
of any termination or reduction of the Incremental Revolver Facility (June 2008)
hereunder.  Upon any reduction of the
Incremental Revolver Facility (June 2008), the Incremental Revolver
Commitment (June 2008) of each Incremental Revolver Lender (June 2008)
shall be reduced by such Incremental Revolver Lender (June 2008)’s
Applicable Incremental Revolver Percentage (June 2008) of such reduction
amount.  All fees in respect of the
Incremental Revolver Facility (June 2008) accrued until the effective date
of any termination of the Incremental Revolver Facility (June 2008) shall
be paid on the effective date of such termination.

 

8.                                       Incremental Revolver (June 2008)
Commitment Fee.  The Company shall pay to the Administrative
Agent for the account of each Incremental Revolver Lender (June 2008) in
accordance with its Applicable Incremental Revolver Percentage (June 2008),
a commitment fee (the “Incremental Revolver (June 2008)  Commitment
Fee”) on the actual daily amount by which the amount of the total
Incremental Revolver Commitments (June 2008) exceeds the Total Incremental
Revolver Outstandings (June 2008) at a rate equal to 0.375% per annum
multiplied by such excess amount.  The
Incremental Revolver (June 2008) Commitment Fee shall accrue at all times
during the Availability Period (June 2008), including at any time during
which one or more of the conditions in Section 12 hereof or in Article V
of the Credit Agreement is not met, and shall be due and payable quarterly in
arrears on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the date upon
which this Incremental Revolver Supplement is executed, and on the last day of
the Availability Period (June 2008). 
Notwithstanding anything to the contrary contained in the Credit 

 

4

 

Agreement, the
Company hereby agrees that the aggregate amount of Incremental Revolver (June 2008)
Commitment Fees accrued hereunder during any period shall be included in the
calculation of Total Interest Expense for such period.

 

9.                                       Obligations of Lenders Several;
Defaulting Lender.  The obligations of the Incremental Revolver
Lenders (June 2008) to make Incremental Revolver Loans (June 2008)
are several and not joint.  The failure
of any Incremental Revolver Lender (June 2008) to make any Incremental Revolver
Loan (June 2008) shall not relieve any other Incremental Revolver Lender (June 2008)
of its corresponding obligation to do so on such date, and no Incremental
Revolver Lender (June 2008) shall be responsible for the failure of any
other Incremental Revolver Lender (June 2008) to so make its Incremental
Revolver Loans (June 2008).  Any
Incremental Revolver Lender (June 2008) that has failed to fund any
portion of the Incremental Revolver Loans (June 2008) required to be
funded by it hereunder or under the Credit Agreement within one Business Day of
the date required to be funded by it hereunder or under the Credit Agreement
shall be considered a Defaulting Lender for purposes of the Incremental
Revolver Facility (June 2008) as the term “Defaulting Lender” is used
herein and in the Credit Agreement.

 

10.                                 Applicable Rate. 
The Applicable Rate with respect to the Incremental Revolver Facility (June 2008)
shall be 1.00% for Base Rate Loans and 2.00% for Eurodollar Rate Loans.

 

11.                                 Amendments to Credit Agreement. 
By their signatures set forth below, the Required Lenders hereby approve
the following amendments to the Credit Agreement:

 

(a)                                  Section 1.01 of the Credit
Agreement, Certain Defined Terms, is hereby modified and amended by
adding the following sentence at the end of the definition of “Revolving Credit
Commitment”:  “Notwithstanding anything
to the contrary contained herein, for purposes of the definition of Required
Lenders only, the term ‘Revolving Credit Commitment’ shall mean, as to each
Revolving Credit Lender, its Revolving Credit Commitment, and as to each
Incremental Revolver Lender (June 2008), its Incremental Revolver
Commitment (June 2008).”

 

(b)                                 Section 2.14 of the Credit
Agreement, Incremental Facility, is hereby modified and amended by deleting
clause (i) from subsection (b) of such Section in its entirety
and substituting the following in lieu thereof: 
“(i) other than the Incremental Revolver Facility (June 2008),
shall have a weighted average life to maturity equal to or greater than the
weighted average life to maturity of the Term A Facility”.

 

12.                                 Conditions Precedent to the Making of
Initial Incremental Revolver Loans (June 2008) and Effectiveness of this
Incremental Revolver Supplement.  The
obligation of each Incremental Revolver Lender (June 2008) to make an
initial Incremental Revolver Loan (June 2008) hereunder, and the
effectiveness of the amendments to the Credit Agreement set forth in Section 11
hereof, are subject to the satisfaction of the following conditions precedent
on or prior to the date of the making of such Incremental Revolver Loan (June 2008):

 

5

 

(a)                                  Execution of Required Documentation. 
The Administrative Agent’s receipt of the following, each of which shall
be originals or telecopies (followed promptly by originals) unless otherwise
specified, each properly executed by a Responsible Officer of the Company, each
dated as of the Incremental Facility (June 2008) Closing Date (or, in the
case of certificates of governmental officials, a recent date before the
Incremental Facility (June 2008) Closing Date) and each in form and
substance reasonably satisfactory to the Administrative Agent and each of the
Incremental Revolver Lenders (June 2008):

 

(i)                           this Incremental Revolver Supplement duly
executed and delivered by each of the Company, the Incremental Revolver Lenders
(June 2008), the Required Lenders (as determined prior to giving effect to
this Incremental Revolver Supplement) and the Administrative Agent; and

 

(ii)                        an Incremental Facility Note in respect
of the Incremental Revolver Facility (June 2008) executed by the Company
in favor of each Incremental Revolver Lender (June 2008) requesting an
Incremental Facility Note.

 

(b)                                 Signatures.  The Company
shall have certified to the Administrative Agent (with copies to be provided
for each Incremental Revolver Lender (June 2008)) the name and signature
of each of the persons authorized (i) to sign on its respective behalf
this Incremental Revolver Supplement and the Incremental Facility Notes; and (ii) to
borrow under this Incremental Revolver Supplement and the Credit
Agreement.  The Incremental Revolver
Lenders (June 2008) may conclusively rely on such certifications until
they receive notice in writing from the Company to the contrary.

 

(c)                                  Proof of Action. 
The Administrative Agent shall have received certified copies of all
necessary action taken by the Company to authorize the execution, delivery and
performance of this Incremental Revolver Supplement.

 

(d)                                 Closing Certificate. 
The Incremental Revolver Lenders (June 2008) shall have received a
certificate from the Company stating that (i) no Default or Event of
Default shall have occurred and be continuing as of the Incremental Facility (June 2008)
Closing Date in respect of the Incremental Revolver Facility (June 2008)
or would result from the proposed Incremental Revolver Loans (June 2008)
or from the application of proceeds thereof; (ii) the representations and
warranties of the Company and each other Loan Party under the Credit Agreement
or any other Loan Document, or which are contained in any document furnished on
or before the Incremental Facility (June 2008) Closing Date under or in
connection herewith or therewith, shall be true and correct, in all material
respects, on and as of the Incremental Facility (June 2008) Closing Date,
except to the extent that such representations and warranties expressly relate
to an earlier date, in which case they shall be true and correct, in all
material respects, as of such earlier date, and except that for purposes of
this 11(d), the representations and warranties contained in Section 6.04(a) and
6.04(b) of the Credit Agreement shall be deemed 

 

6

 

to refer to the
most recent statements furnished pursuant to Section 7.01(a) and 7.01(b) of
the Credit Agreement, respectively; and (iii) since December 31,
2007, no event or condition has occurred which has had, or which could
reasonably be expected to have, a Materially Adverse Effect.

 

(e)                                  Opinions of Counsel to the Company. 
The Incremental Revolver Lenders (June 2008) shall have received favorable opinions of:

 

(i)            Victoria D. Salhus, Esq.,
Senior Vice President, Deputy General Counsel and Secretary for the Company and the Restricted Subsidiaries
in form and substance reasonably satisfactory to the Joint Lead Arrangers; and

 

(ii)           Sullivan & Cromwell LLP, special New York
counsel to the Company and the Restricted Subsidiaries in form and substance
reasonably satisfactory to the Joint Lead Arrangers;

 

and covering such
other matters as any Incremental Revolver Lender (June 2008) or special
New York counsel to the Administrative Agent, Paul, Hastings, Janofsky &
Walker LLP, may reasonably request (and for purposes of such opinions such
counsel may rely upon opinions of counsel in other jurisdictions, provided
that such other counsel are satisfactory to special counsel to the
Administrative Agent and such other opinions state that the Incremental
Revolver Lenders (June 2008) are entitled to rely thereon).

 

(f)                                    Compliance Certificate. 
The Incremental Revolver Lenders (June 2008) shall have received a
Compliance Certificate showing that, after giving effect to this Incremental
Revolver Supplement and the Indebtedness contemplated to be incurred by the
Company on the Incremental Facility (June 2008) Closing Date in respect of
the Incremental Revolver Facility (June 2008) and the use of proceeds
thereof, the Company is in compliance with the provisions of this Incremental
Revolver Supplement and the Credit Agreement on a pro forma basis as of the
Incremental Facility (June 2008) Closing Date.

 

(g)                                 Other Documents. 
Such other documents, filings, instruments and papers relating to the
documents referred to herein and the transactions contemplated hereby
(including officer’s certificates of the Company and each Restricted Subsidiary
bringing down the representations made on the Closing Date with respect to the
organizational documents of such Persons), as any Incremental Revolver Lender (June 2008)
or special counsel to the Administrative Agent shall reasonably require shall
have been received by the Administrative Agent.

 

(h)                                 Certain Fees. 
All fees required to be paid to the Administrative Agent and the
Incremental Revolver Lenders (June 2008) on or before the Incremental
Facility (June 2008) Closing Date shall have been paid.  Unless waived by the Administrative Agent,
the Company shall have paid all fees, charges and disbursements of counsel to
the Administrative Agent to the extent properly invoiced prior to or on the
Incremental Facility (June 2008) Closing Date, plus 

 

7

 

such additional
amounts of such fees, charges and disbursements as shall constitute its
reasonable estimate of such fees, charges and disbursements incurred or to be
incurred by it through the closing proceedings (provided that such
estimate shall not thereafter preclude a final settling of accounts between the
Company and the Administrative Agent).

 

(i)                                     Revised Financial Projections. 
The Incremental Revolver Lenders (June 2008) shall have received
revised financial projections, which shall be in
form and substance reasonably satisfactory to the Administrative Agent and
which shall demonstrate the Company’s ability to timely repay the Incremental
Revolver Facility (June 2008)
and any Incremental Revolver Loans (June 2008) thereunder and to comply with the terms and conditions of this
Incremental Revolver Supplement, the Credit Agreement and the other Loan
Documents

 

Without limiting the generality of the provisions of Section 9.04
of the Credit Agreement, for purposes of determining compliance with the
conditions specified in this Section 12, each Incremental Revolver Lender (June 2008) that has
signed this Incremental Revolver Supplement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to an Incremental Revolver Lender (June 2008) unless the Administrative
Agent shall have received notice from such Incremental Revolver Lender (June 2008) prior to the Incremental Facility (June 2008)
Closing Date specifying its objection thereto.

 

13.                                 Conditions to all Credit Extensions. 
The obligation of each Incremental Revolver Lender (June 2008) to
make each Credit Extension in respect of the Incremental Revolver Facility (June 2008)
under this Incremental Revolver Supplement and the Credit Agreement is subject
to the additional conditions precedent set forth in Section 5.02 of the
Credit Agreement.  Notwithstanding
anything to the contrary contained in the Credit Agreement, to the extent that
such conditions require the delivery of a Request for Credit Extension in
respect of any Incremental Revolver Loans, such condition shall be satisfied by
the delivery of a notice of Incremental Revolver Borrowing, which shall be in
the form of a Committed Loan Notice.

 

14.                                 Joinder.  By executing
and delivering this Incremental Revolver Supplement, and upon satisfaction of
the conditions set forth in Section 12 hereof and Section 2.14 of the
Credit Agreement, each Incremental Revolver Lender (June 2008) hereby (a) becomes
a party to the Credit Agreement as a “Lender” thereunder with the same force
and effect as if originally named therein as a Lender, and (b) expressly,
irrevocably and absolutely assumes all obligations and liabilities of a “Lender”
under the Credit Agreement (as supplemented hereby).  Each reference to a “Lender” in the Credit
Agreement shall be deemed to include each Incremental Revolver Lender (June 2008).  By executing and delivering this Incremental
Revolver Supplement, the Company hereby (x) promises to repay all of the
Incremental Revolver Loans (June 2008) as “Incremental Facility Loans”
under the Credit Agreement on the Maturity Date applicable thereto, (y) agrees
that the Incremental Revolver Loans (June 2008) are “Obligations” under
the Credit Agreement and secured by all of the Collateral, and (z) the
Incremental Revolver Lenders (June 

 

8

 

2008) are entitled
to all rights, remedies and privileges as Lenders under the Loan Documents.

 

15.                                 Assignments. 
Any Incremental Revolver Lender (June 2008) may at any time assign
to one or more Eligible Assignees all or a portion of its rights and
obligations under this Incremental Revolver Supplement and the Credit Agreement
(including all or a portion of its Incremental Revolver Commitment (June 2008)
and the Incremental Revolver Loans (June 2008) at the time owing to it);
provided that any such assignment shall be subject to the conditions set forth
in Section 10.06(b) of the Credit Agreement with respect to
assignments of Revolving Credit Commitments and Revolving Credit Loans.

 

16.                                 Terms Incorporated. 
All of the terms and conditions of the Credit Agreement are hereby
incorporated in this Incremental Revolver Supplement by reference thereto as
fully and to the same extent as if set forth herein, and the Credit Agreement,
as amended and supplemented hereby, is hereby ratified, approved and confirmed
as of the date hereof.

 

17.                                 Counterparts. 
This Incremental Revolver Supplement may be executed in counterparts
(and by different parties hereto in different counterparts), each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract.

 

18.                                 GOVERNING LAW. 
THIS INCREMENTAL REVOLVER SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

19.                                 Loan Document. 
This Incremental Revolver Supplement is a Loan Document.

 

[Signature Pages Follow]

 

9

 

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

 

 

	
   

  	
   RAINBOW
  NATIONAL SERVICES LLC

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   Name:

  
	
   

  	
   

  	
   Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  JPMORGAN CHASE
  BANK, N.A.,

  
	
   

  	
  as
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  BANK OF AMERICA,
  N.A.,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  CITIBANK, N.A.,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  MORGAN STANLEY
  BANK,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  FORTIS CAPITAL
  CORP.,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  DEUTSCHE BANK
  TRUST COMPANY AMERICAS,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  MERRILL LYNCH
  BANK USA,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  THE ROYAL BANK
  OF SCOTLAND PLC,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  THE BANK OF NOVA
  SCOTIA,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  GENERAL ELECTRIC
  CAPITAL CORPORATION,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  UNION BANK OF
  CALIFORNIA,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  BNP PARIBAS,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  SUNTRUST BANK,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  U.S. BANK
  NATIONAL ASSOCIATION,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

	
   

  	
  GOLDMAN SACHS
  CREDIT PARTNERS L.P.,

  
	
   

  	
  as Incremental
  Revolver Lender (June 2008)

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
     Name:

  
	
   

  	
     Title:

  

 

INCREMENTAL REVOLVER
SUPPLEMENT

 

 

SCHEDULE I

TO 

INCREMENTAL REVOLVER SUPPLEMENT

 

INCREMENTAL
REVOLVER COMMITMENTS (JUNE 2008)  AND APPLICABLE
PERCENTAGES

 

	
  Incremental
  Revolver Lenders (June

  2008)

  	
   

  	
  Incremental Revolver Commitment (June

  2008)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Citibank, N.A.

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Morgan Stanley Bank

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Fortis Bank SA/NV, New
  York Branch

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Deutsche Bank Trust
  Company Americas

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Merrill Lynch Bank USA

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  The Royal Bank of
  Scotland PLC

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  General Electric
  Capital Corporation

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Union Bank of
  California

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  BNP Paribas

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  SunTrust Bank

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  U.S. Bank National
  Association

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Goldman Sachs Credit
  Partners L.P.

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  7.142857142

  	
  %

  
	
  Total:

  	
   

  	
  $

  	
  280,000,000

  	
   

  	
  100

  	
  %

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}]]