Document:

exv4w1

Exhibit 4.1

 

RIGHTS AGREEMENT

between

SPSS INC.

and

COMPUTERSHARE TRUST COMPANY, N.A.

Rights Agent

and

COMPUTERSHARE INVESTOR SERVICES, L.L.C.

Transfer Agent

Dated as of June 18, 2008

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	SECTION 1.
	 	CERTAIN DEFINITIONS	 	 	1	 
	SECTION 2.
	 	APPOINTMENT OF RIGHTS AGENT	 	 	7	 
	SECTION 3.
	 	ISSUE OF RIGHTS CERTIFICATES	 	 	7	 
	SECTION 4.
	 	FORM OF RIGHTS CERTIFICATES	 	 	8	 
	SECTION 5.
	 	COUNTERSIGNATURE AND REGISTRATION	 	 	9	 
	SECTION 6.
	 	TRANSFER, SPLIT-UP, COMBINATION AND EXCHANGE OF RIGHTS CERTIFICATES; MUTILATED, DESTROYED, LOST OR
STOLEN RIGHTS CERTIFICATES	 	 	9	 
	SECTION 7.
	 	EXERCISE OF RIGHTS; PURCHASE PRICE	 	 	10	 
	SECTION 8.
	 	CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES	 	 	12	 
	SECTION 9.
	 	RESERVATION AND AVAILABILITY OF COMMON STOCK	 	 	12	 
	SECTION 10.
	 	COMMON STOCK RECORD DATE	 	 	14	 
	SECTION 11.
	 	ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES OR NUMBER OF RIGHTS	 	 	14	 
	SECTION 12.
	 	CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF SHARES	 	 	21	 
	SECTION 13.
	 	CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING POWER	 	 	21	 
	SECTION 14.
	 	FRACTIONAL RIGHTS AND FRACTIONAL SHARES	 	 	24	 
	SECTION 15.
	 	RIGHTS OF ACTION	 	 	25	 
	SECTION 16.
	 	AGREEMENT OF RIGHTS HOLDERS	 	 	25	 
	SECTION 17.
	 	RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER	 	 	26	 
	SECTION 18.
	 	CONCERNING THE RIGHTS AGENT	 	 	26	 
	SECTION 19.
	 	MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT	 	 	26	 
	SECTION 20.
	 	DUTIES OF RIGHTS AGENT AND OF TRANSFER AGENT	 	 	27	 
	SECTION 21.
	 	CHANGE OF RIGHTS AGENT	 	 	29	 
	SECTION 22.
	 	ISSUANCE OF NEW RIGHTS CERTIFICATES	 	 	30	 
	SECTION 23.
	 	REDEMPTION AND TERMINATION	 	 	30	 
	SECTION 24.
	 	EXCHANGE	 	 	31	 
	SECTION 25.
	 	NOTICE OF CERTAIN EVENTS	 	 	32	 
	SECTION 26.
	 	NOTICES	 	 	33	 
	SECTION 27.
	 	SUPPLEMENTS AND AMENDMENTS	 	 	33	 
	SECTION 28.
	 	SUCCESSORS	 	 	34	 
	SECTION 29.
	 	DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS, ETC.	 	 	34	 
	SECTION 30.
	 	BENEFITS OF THIS AGREEMENT	 	 	35	 
	SECTION 31.
	 	SEVERABILITY	 	 	35	 
	SECTION 32.
	 	GOVERNING LAW	 	 	35	 
	SECTION 33.
	 	COUNTERPARTS	 	 	35	 
	SECTION 34.
	 	DESCRIPTIVE HEADINGS	 	 	35	 
	SECTION 35.
	 	FORCE MAJEURE	 	 	35	 

i 

 

Exhibit A — Form of Rights Certificate

ii 

 

RIGHTS AGREEMENT

     Rights Agreement, dated as of June 18, 2008 (this “Agreement”), by and between SPSS
Inc., a Delaware corporation (the “Company”), and Computershare Trust Company, N.A., a
federally chartered trust company (the “Rights Agent”) and Computershare Investor Services,
L.L.C., a Delaware limited liability company (the “Transfer Agent”).

W I T N E S S E T H:

     WHEREAS, the Company currently has rights (the “Old Rights”) attached to each share of
common stock, par value $0.01 per share of the Company (the “Common Stock”) pursuant to an
Amended and Restated Rights Agreement dated as of August 31, 2004 between the Company and
Computershare Trust Company, N.A.

     WHEREAS, the Old Rights will expire on the close of business on June 18, 2008.

     WHEREAS, the Board of Directors of the Company has authorized the issuance of one Right in
respect of, and to be issued together with, each share of Common Stock issued and outstanding as of
the close of business on June 18, 2008 (the “Record Date”); and the Board of Directors of
the Company 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 (whether originally issued or delivered from the Company’s treasury) between the
Record Date and the earlier of the Distribution Date (as hereinafter defined) and the Expiration
Date (as hereinafter defined), and, in certain circumstances provided for in Section 22
hereof, after the Distribution Date, each Right initially representing the right to purchase one
Fractional Share (as hereinafter defined) of Common Stock, upon the terms and subject to the
conditions hereinafter set forth (the “Rights”).

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

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

     “Acquiring Person” shall mean any Person who or which, together with all Affiliates
and Associates of such Person, shall be the Beneficial Owner of 15% or more of the shares of Common
Stock then outstanding, but shall not include any Exempt Person; provided, however,
that a Person shall not be or become an Acquiring Person if such Person, together with its
Affiliates and Associates, shall become the Beneficial Owner of 15% or more of the shares of Common
Stock then outstanding solely as a result of a reduction in the number of shares of Common Stock
outstanding due to the repurchase of Common Stock by the Company unless and until such time as such
Person or any Affiliate or Associate of such Person shall purchase or otherwise become the
Beneficial Owner of additional shares of Common Stock constituting 1% or more of the
then-outstanding shares of Common Stock or any other Person (or Persons) who is (or collectively
are) the Beneficial Owner of shares of Common Stock constituting 1% or more of the then-outstanding
shares of Common Stock shall become an Affiliate or Associate of such Person; and provided,
further, that if the Board of Directors, with the concurrence of a majority

 

 

of the members of the Board of Directors who are not such Person or representatives, nominees,
Affiliates or Associates of such Person, determines in good faith that a Person that would
otherwise be an “Acquiring Person” has become such inadvertently (including, without limitation,
because (1) such Person was unaware that it beneficially owned a percentage of Common Stock that
would otherwise cause such Person to be an “Acquiring Person” or (2) such Person was aware of the
extent of its Beneficial Ownership of Common Stock but had no actual knowledge of the consequences
of such Beneficial Ownership under this Agreement) and without any intention of changing or
influencing control of the Company, and if such Person as promptly as practicable divested or
divests itself of Beneficial Ownership of a sufficient number of shares of Common Stock so that
such Person would no longer be an “Acquiring Person,” then such Person shall not be deemed to be or
to have become an “Acquiring Person” for any purposes of this Agreement.

     “Adjustment Fraction” shall have the meaning set forth in Section 11(p)
hereof.

     “Adjustment Shares” shall have the meaning set forth in Section 11(a)(ii)
hereof.

     “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act, as in effect on the date of this Agreement.

     “Associate” shall mean, with reference to any Person, (1) any corporation, firm,
partnership, association, unincorporated organization or other entity (other than the Company or a
Subsidiary of the Company) of which such Person is an officer or general partner (or officer or
general partner of a general partner) or is, directly or indirectly, the Beneficial Owner of 10% or
more of any class of equity securities, (2) any trust or other estate in which such Person has a
substantial beneficial interest or as to which such Person serves as trustee or in a similar
fiduciary capacity and (3) any relative or spouse of such Person, or any relative of such spouse,
who has the same home as such Person.

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

     (i) that such Person or any of such Person’s Affiliates or Associates, directly or
indirectly, is the “beneficial owner” of (as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the Exchange Act as in effect on the date of this
Agreement) or otherwise has the right to vote or dispose of, including, without limitation,
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 (i) as a result of an
agreement, arrangement or understanding to vote such security if such agreement, arrangement
or understanding: (A) arises solely from a revocable proxy or consent given in response to a
proxy or consent solicitation that is not exempted by Rule 14a-2(b)(2) of the General Rules
and Regulations under the Exchange Act as in effect on the date of this Agreement and that
is made pursuant to, and in accordance with, the applicable provisions of the General Rules
and Regulations under the Exchange Act and (B) is not then reportable by such Person on
Schedule 13D or 13G under the Exchange Act (or any comparable or successor report);

2

 

     (ii) that such Person or any of such Person’s Affiliates or Associates, directly or
indirectly, has the right or obligation to acquire (whether such right or obligation is
exercisable or effective immediately or only after the passage of time or the occurrence of
an event) pursuant to any agreement, arrangement or understanding (whether or not in
writing) or upon the exercise of conversion rights, exchange rights, other rights, warrants
or options, or otherwise; provided, however, that a Person shall not be
deemed the “Beneficial Owner” of, or to “beneficially own,” (A) securities tendered pursuant
to a tender or exchange offer made by 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, or (C) securities issuable upon exercise of Rights from and after the
occurrence of a Triggering Event which Rights were acquired by such Person or any of such
Person’s Affiliates or Associates prior to the Distribution Date or pursuant to Section
3(a) or Section 22 hereof (the “Original Rights”) or pursuant to
Section 11(i) or (p) hereof in connection with an adjustment made with
respect to any Original Rights; or

     (iii) that are beneficially owned, directly or indirectly, by (A) 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, disposing (except pursuant to a tender of
securities pursuant to a tender or exchange offer prior to such tendered securities being
accepted for purchase or exchange as described in the proviso to subparagraph (ii) of this
definition) or voting (except pursuant to a revocable proxy or consent as described in the
proviso to subparagraph (i) of this definition) of any voting securities of the Company or
(B) any group (as that term is used in Rule 13d-5(b) of the General Rules and Regulations
under the Exchange Act) of which such Person is a member;

provided, however, that nothing in this definition 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 (including, without limitation, securities acquired pursuant to stabilizing
transactions to facilitate a public offering in accordance with Regulation M promulgated under the
Exchange Act, or to cover overallotments created in connection with a public offering) until the
expiration of forty days after the date of such acquisition. For purposes of this Agreement,
“voting” a security shall include voting, granting a proxy, acting by consent, making a request or
demand relating to corporate action (including, without limitation, calling a stockholder meeting)
or otherwise giving an authorization (within the meaning of Section 14(a) of the Exchange Act as in
effect on the date of this Agreement) in respect of such security.

     “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.

     “Close of business” on any given date shall mean 5:00 p.m., eastern time, on such
date; provided, however, that if such date is not a Business Day, it shall mean
5:00 p.m., eastern time, on the next succeeding Business Day.

3

 

     “Closing Price” of a security for any day shall mean the last sales price, regular
way, on such day or, in case no such sale takes place on such day, the average of the closing bid
and asked prices, regular way, on such day, in either case as reported in the principal transaction
reporting system with respect to securities listed or admitted to trading on the New York Stock
Exchange, or, if such security is not listed or admitted to trading on the New York Stock Exchange,
on the principal national securities exchange on which such security is listed or admitted to
trading, or, if such security is not listed or admitted to trading on any national securities
exchange but sales price information is reported for such security, as reported by NASDAQ or such
other self-regulatory organization or registered securities information processor (as such terms
are used under the Exchange Act) that then reports information concerning such security, or, if
sales price information is not so reported, the average of the high bid and low asked prices in the
over-the-counter market on such day, as reported by NASDAQ or such other entity, or, if on such day
such security is not quoted by any such entity, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in such security selected by the Board of
Directors of the Company, or, if on such day no market maker is making a market in such security,
the fair value of such security on such day as determined in good faith by the Board of Directors
of the Company.

     “Common Stock” shall mean the common stock, par value $0.01 per share, of the Company,
except that “Common Stock” when used with reference to equity interests issued by 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.

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

     “Company” shall mean the Person named as the “Company” in the preamble of this
Agreement until a successor Person shall have become such or until a Principal Party shall assume,
and thereafter be liable for, all obligations and duties of the Company hereunder, pursuant to the
applicable provisions of this Agreement, and thereafter “Company” shall mean such successor Person
or Principal Party.

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

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

     “Distribution Date” shall mean the earlier of (i) the close of business on the tenth
day (or, if such Stock Acquisition Date results from the consummation of a Permitted Offer, such
later date as may be determined by the Company’s Board of Directors as set forth below before the
Distribution Date occurs) after the Stock Acquisition Date or (ii) the close of business on the
tenth Business Day (or such later date as may be determined by the Company’s Board of Directors as
set forth below before the Distribution Date occurs) after the date that a tender offer or exchange
offer by any Person (other than any Exempt Person) 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 as then in
effect, if upon consummation thereof, such Person would be an Acquiring Person, other than a tender
or exchange offer that is determined before the

4

 

Distribution Date occurs to be a Permitted Offer. The Board of Directors of the Company may,
to the extent set forth in the preceding sentence, defer the date set forth in clause (i) or (ii)
of the preceding sentence to a specified later date or to an unspecified later date to be
determined by a subsequent action or event (but in no event to a date later than the close of
business on the tenth day after the first occurrence of a Triggering Event).

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

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

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

     “Exempt Person” shall mean the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company, and any Person organized,
appointed or established by the Company for or pursuant to the terms of any such plan or for the
purpose of funding any such plan or funding other employee benefits for employees of the Company or
any Subsidiary of the Company.

     “Expiration Date” shall mean the earliest to occur of (i) the Final Expiration Date,
(ii) the time at which the Rights are redeemed as provided in Section 23 hereof, (iii) the
time at which the Rights expire pursuant to Section 13(d) hereof, and (iv) the time at
which all Rights then outstanding and exercisable are exchanged pursuant to Section 24
hereof.

     “Final Expiration Date” shall mean the close of business on June 18, 2018.

     “Flip-In Event” shall mean an event described in Section 11(a)(ii) hereof.

     “Flip-In Trigger Date” shall have the meaning set forth in Section 11(a)(iii)
hereof.

     “Flip-Over Event” shall mean any event described in clause (x), (y) or (z) of
Section 13(a) hereof, but excluding any transaction described in Section 13(d)
hereof that causes the Rights to expire.

     “Fractional Share” with respect to the Common Stock shall mean one one-half of a share
of Common Stock.

     “NASDAQ” shall mean the NASDAQ Stock Market.

     “Original Rights” shall have the meaning set forth in the definition of “Beneficial
Owner.”

     “Permitted Offer” shall mean a tender offer or an exchange offer for all outstanding
shares of Common Stock at a price and on terms determined, prior to the time the Person making the
offer or any Affiliate or Associate thereof is an Acquiring Person, by at least a majority of the
members of the Board of Directors of the Company who are not officers or employees of the Company
and who are not, and are not representatives, nominees, Affiliates or Associates of, an Acquiring
Person or the Person making the offer, after receiving advice from one or more investment banking
firms, to be (a) at a price and on terms that are fair to stockholders and not

5

 

inadequate (taking into account all factors that such members of the Board of Directors deem
relevant including, without limitation, prices that could reasonably be achieved if the Company or
its assets were sold on an orderly basis designed to realize maximum value) and (b) otherwise in
the best interests of the Company and its stockholders.

     “Person” shall mean any individual, firm, corporation, partnership, limited liability
company, association, trust, unincorporated organization or other entity.

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

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

     “Record Date” shall have the meaning set forth in the recitals clause at the beginning
of this Agreement.

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

     “Rights” shall have the meaning set forth in the recitals clause at the beginning of
this Agreement.

     “Rights Agent” shall mean the Person named as the “Rights Agent” in the preamble of
this Agreement until a successor Rights Agent shall have become such pursuant to the applicable
provisions hereof, and thereafter “Rights Agent” shall mean such successor Rights Agent. If at any
time there is more than one Person appointed by the Company as Rights Agent pursuant to the
applicable provisions of this Agreement, “Rights Agent” shall mean and include each such Person.

     “Rights Certificates” shall mean the certificates evidencing the Rights.

     “Securities Act” shall mean the Securities Act of 1933, as amended.

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

     “Stock Acquisition Date” shall mean the first date of public announcement (which, for
purposes of this definition and Section 23, shall include, without limitation, a report
filed pursuant to Section 13(d) of the Exchange Act) by the Company or an Acquiring Person that an
Acquiring Person has become such.

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

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

     “Trading Day” with respect to a security shall mean a day on which the principal
national securities exchange on which such security is listed or admitted to trading is open for
the

6

 

transaction of business, or, if such security is not listed or admitted to trading on any
national securities exchange, a Business Day.

     “Triggering Event” shall mean any Flip-In Event or any Flip-Over Event.

          Section 2. Appointment of Rights Agent. The Company hereby appoints the Rights Agent
(i) to act as agent for the Company and (ii) to take certain actions in respect of 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) (although it is expressly agreed that the Rights Agent
shall not act as agent for such holders) in accordance with the terms and conditions hereof, and
the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such
co-Rights Agents as it may deem necessary or desirable, upon ten (10) days’ prior written notice to
the Rights Agent. The Rights Agent shall have no duty to supervise, and shall in no event be
liable for, the acts or omissions of any such co-Rights Agent.

          Section 3. Issue of Rights Certificates

          (a) Until the Distribution Date, (x) the Rights will be evidenced by the certificates for
Common Stock registered in the names of the holders of the Common Stock 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, without limitation, 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 (other than any Person referred to in the first sentence of
Section 7(e) hereof), at the address of such holder shown on the records of the Company,
one or more 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) One Right will be issued in respect of each share of Common Stock issued and outstanding
as of the close of business on the Record Date. Certificates issued for such shares of Common
Stock and for shares of Common Stock that are issued or shall be transferred or exchanged after the
Record Date but prior to the earlier of the Distribution Date or the Expiration Date shall also be
deemed to be certificates for Rights, and shall bear the legend referred to in paragraph (c) of
this Section 3.

          (c) Rights shall be issued in respect of all shares of Common Stock that are issued (whether
originally issued or delivered from the Company’s treasury) after the Record Date but prior to the
earlier of the Distribution Date or the Expiration Date or, in certain circumstances provided in
Section 22 hereof, after the Distribution Date. Certificates issued for shares of Common
Stock that shall so become outstanding or shall be transferred or exchanged

7

 

after the Record Date but prior to the earlier of the Distribution Date or the Expiration Date
shall also be deemed to be certificates for Rights, and shall bear the following legend:

     This certificate also evidences and entitles the holder hereof to certain Rights as set
forth in the Rights Agreement between SPSS Inc. (the “Company”) and Computershare
Trust Company, N.A. (the “Rights Agent”), dated as of June 18, 2008, as it may from
time to time be supplemented or amended (the “Rights Agreement”), the terms of which
are hereby incorporated herein by reference and a copy of which is on file at the principal
offices of the Company. Under certain circumstances, as set forth in the Rights Agreement,
such Rights may be redeemed, may be exchanged, may expire or may be evidenced by separate
certificates and will no longer be evidenced by this certificate. The Company or the Rights
Agent 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
BENEFICIALLY OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING
PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT), AND CERTAIN TRANSFEREES THEREOF, WILL BECOME NULL AND VOID AND WILL NO LONGER BE
TRANSFERABLE.

With respect to such certificates containing the foregoing legend, until the earlier of the
Distribution Date or the Expiration Date, the Rights associated with the Common Stock represented
by such certificates shall be evidenced by such certificates alone, and registered holders of
Common Stock shall also be the registered holders of the associated Rights, 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), when, as and if issued, shall be substantially in the form set
forth in Exhibit A hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation
of any stock exchange or quotation system on which the Rights may from time to time be listed or
quoted, or to conform to usage. Subject to the provisions of Section 11 and Section
22 hereof, the Rights Certificates, whenever issued, shall be dated as of the Record Date and
on their face shall entitle the holders thereof to purchase such number of Fractional Shares of
Common Stock as shall be set forth therein at the price set forth therein (such exercise price per
Fractional Share (or, as set forth in this Agreement, for other securities), 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) or Section 22
hereof that represents Rights beneficially owned by a Person described in the first sentence of

8

 

Section 7(e) hereof, and any Rights Certificate issued pursuant to Section 6
or Section 11 hereof upon transfer, exchange, replacement or adjustment of any such Rights,
shall contain (to the extent feasible) the following legend, modified as applicable to apply to
such Person:

The Rights represented by this Rights Certificate are or were beneficially owned by a Person
who was or became an Acquiring Person or an Affiliate or Associate of an Acquiring Person
(as such terms are defined in the Rights Agreement). Accordingly, this Rights Certificate
and the Rights represented hereby [will] [have] become null and void in the circumstances
and with the effect specified in Section 7(e) of the Rights Agreement.

The provisions of Section 7(e) of this Agreement shall be operative whether or not the
foregoing legend is contained on any such Rights Certificate. The Company shall give notice to the
Rights Agent promptly after it becomes aware of the existence of any Acquiring Person or any
Associate or Affiliate thereof.

          Section 5. Countersignature and Registration.

          (a) The Rights Certificates shall be executed on behalf of the Company by its Chairman of the
Board, its Chief Executive Officer, its President or any Executive 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 Certificate may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Rights Certificate, shall be a proper officer of
the Company to sign such Rights Certificate, although at the date of the execution of this Rights
Agreement any such person was not such an officer.

          (b) Following the Distribution Date, the Rights Agent will keep or cause to be kept, at its
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 certificate number and the date of each of the Rights Certificates.

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

          (a) Subject to the provisions of Section 4(b), Section 7(e), Section
13(d), Section 14 and Section 24 hereof, at any time after the close of
business on the Distribution Date,

9

 

and at or prior to the close of business on the Expiration Date, any Rights Certificate or
Rights Certificates may be transferred, split up, combined or exchanged for another Rights
Certificate or Rights Certificates, entitling the registered holder to purchase a like number of
Fractional Shares of Common Stock (or, following a Triggering Event, Common Stock, other
securities, cash or other assets, as the case may be) as the Rights Certificate or Rights
Certificates surrendered then entitled such holder (or former holder in the case of a transfer) to
purchase. Any registered holder desiring to transfer, split up, combine or exchange any Rights
Certificate or Rights Certificates shall make such request in writing delivered to the Rights
Agent, and shall surrender the Rights Certificate or Rights Certificates to be transferred, split
up, combined or exchanged at the 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) thereof or of the
Affiliates or Associates thereof as the Company shall reasonably request. Thereupon the Rights
Agent shall, subject to Section 4(b), Section 7(e), Section 13(d),
Section 14 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 by the holder 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, subject to Section 4(b), Section 7(e), Section 13(d), Section
14 and Section 24, 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.

          (a) Subject to Section 7(e) hereof, the registered holder of any Rights Certificate
may exercise the Rights evidenced thereby (except as otherwise provided herein including, without
limitation, the restrictions on exercisability set forth in Section 9(c),
Section 11(a)(iii) and Section 23(a) hereof) in whole or in part at any time after
the Distribution Date upon surrender of the Rights Certificate, with the form of election to
purchase and the certificate on the reverse side thereof duly completed and 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 Fractional Shares
of Common Stock (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 Expiration Date.

          (b) The Purchase Price for each Fractional Share of Common Stock pursuant to the exercise of a
Right shall initially be $175.00, and shall be subject to adjustment from time to

10

 

time as provided in Sections 11 and 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 on the reverse side thereof duly executed, accompanied by
payment, with respect to each Right so exercised, of the Purchase Price per Fractional Share of
Common 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 (i)(k) hereof, thereupon promptly (i)(A) requisition from any
transfer agent of the shares of Common Stock (or make available, if the Rights Agent is the
transfer agent for such shares) certificates for the total number of Fractional Shares of Common
Stock to be purchased, and the Company hereby irrevocably authorizes its transfer agent to comply
with all such requests, or (B) if the Company, in its sole discretion, shall have elected to
deposit the shares of Common Stock issuable upon exercise of the Rights hereunder with a depositary
agent, requisition from the depositary agent depositary receipts representing interests in such
number of Fractional Shares of Common Stock as are to be purchased (in which case certificates for
the shares of Common 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) may be made in cash or by
certified check, cashier’s or official bank check or bank draft payable to the order of the Company
or the Rights Agent. In the event that the Company is obligated to issue other securities
(including, without limitation, Common Stock) of the Company, pay cash and/or distribute other
property pursuant to Section 11(a) or Section 13(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 exercise of Rights, a number of
Rights be exercised so that only whole shares of Common Stock would be issued.

          (d) In case the registered holder of any Rights Certificate shall exercise fewer 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 Triggering Event, any Rights beneficially owned by or transferred to (i) an
Acquiring Person or an Associate or Affiliate of an Acquiring Person other than any such Person
that became such pursuant to a Permitted Offer and the Board of Directors of the Company in good
faith determines was not involved in and did not cause or facilitate, directly or indirectly, such
Triggering Event, (ii) a direct or indirect transferee of such Rights from such Acquiring Person
(or any such Associate or Affiliate) who becomes a transferee after such

11

 

Triggering Event or (iii) a direct or indirect transferee of such Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee prior to or concurrently with such Triggering
Event and receives such Rights pursuant to either (A) a transfer (whether or not for consideration)
from such Acquiring Person (or such Affiliate or Associate) to holders of equity interests in such
Acquiring Person (or such Affiliate or Associate) or to any Person with whom such Acquiring Person
(or such Affiliate or Associate) has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer that the Board of Directors of the Company
determines is part of a plan, arrangement or understanding that has as a primary purpose or effect
the avoidance of this Section 7(e), shall become null and void without any further action,
no holder of such Rights shall have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise, and such Rights shall not be transferable. The
Company shall use all reasonable efforts to ensure that the provisions of this Section 7(e)
and Section 4(b) hereof are complied with, but shall have no liability to any holder of
Rights Certificates or 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 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 canceled form, or, if surrendered to the Rights Agent, shall be canceled by it,
and no Rights Certificates shall be issued in lieu thereof except as expressly permitted by any of
the provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation
and retirement, and the Rights Agent shall so cancel and retire, any other Rights Certificate
purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent
shall deliver all canceled Rights Certificates to the Company, or shall, at the written request of
the Company, destroy such canceled Rights Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.

          Section 9. Reservation and Availability of Common 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 Common Stock the number of shares of Common Stock that,
as provided in this Agreement, including, without limitation, Section 11(a)(iii) hereof,
will be sufficient to permit the exercise in full of all outstanding Rights.

          (b) So long as any shares of Common Stock are listed on any national securities exchange or
quoted on any trading system, the Company shall use its best efforts to cause, from

12

 

and after such time as the Rights become exercisable, all shares reserved for such issuance to
be listed on such exchange, or quoted on such system, upon official notice of issuance upon such
exercise. Following the occurrence of a Triggering Event, the Company will use its best efforts to
list (or continue the listing of) the Rights and the securities issuable and deliverable upon the
exercise of the Rights on one or more national securities exchanges or to cause the Rights and the
securities purchasable upon exercise of the Rights to be reported by such transaction reporting
system then in use.

          (c) The Company shall use its best efforts to (i) prepare and file, as soon as practicable
following the first occurrence of a Flip-In Event or, if applicable, as soon as practicable
following the earliest date after the first occurrence of a Flip-In Event on which the
consideration to be delivered by the Company upon exercise of the Rights has been determined
pursuant to this Agreement (including, without limitation, in accordance with
Section 11(a)(iii) hereof), a registration statement on an appropriate form under the
Securities Act with respect to the securities purchasable upon exercise of the Rights, (ii) cause
such registration statement to become effective as soon as practicable after such filing, and (iii)
cause such registration statement to remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the earlier of (A) the date as of which the Rights are no
longer exercisable for such securities and (B) the Expiration Date. The Company will also take
such action as may be appropriate under, or to ensure compliance with, the securities or “blue sky”
laws of the various states in connection with the exercisability of the Rights. The Company may
temporarily suspend, for a period of time not to exceed 90 days after the date set forth in clause
(i) of the first sentence of this Section 9(c), the exercisability of the Rights in order
to prepare and file such registration statement and permit it to become effective. In addition, if
the Company shall determine that the Securities Act requires an effective registration statement
under the Securities Act following the Distribution Date, the Company may temporarily suspend the
exercisability of the Rights until such time as such a registration statement has been declared
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 is no longer in effect. 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 any required 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 Fractional Shares of Common Stock and/or other securities delivered upon exercise
of Rights shall, at the time of delivery of the certificates for such shares or securities (subject
to payment of the Purchase Price), be duly and validly authorized and issued and fully paid and
nonassessable.

          (e) The Company further covenants and agrees that it will pay when due and payable any and all
federal and state transfer taxes and charges that may be payable in respect of the issuance or
delivery of the Rights Certificates and of any certificates for a number of Fractional Shares of
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 that may be payable in respect of any
transfer or delivery of Rights Certificates to a Person other than, or the issuance or delivery of
a number of Fractional Shares of Common Stock, and/or

13

 

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 Fractional Shares of Common Stock, and/or other securities, as the
case may be, in a name other than that of the registered holder upon the exercise of any Rights
until such tax shall have been paid (any such tax being payable by the holder of such Rights
Certificate at the time of surrender) or until it has been established to the Company’s
satisfaction that no such tax is due.

          Section 10. Common Stock Record Date. Each Person in whose name any certificate for a
number of Fractional Shares of 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 shares (fractional or otherwise) of 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 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 Common Stock, and/or other securities, as the case may
be, transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby,
the holder of a Rights Certificate, as such, shall not be entitled to any rights of a stockholder
of the Company with respect to 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 or other securities subject to
purchase upon exercise of 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 (A) declare a dividend on the
outstanding shares of Common Stock payable in shares of Common Stock, (B) subdivide the
outstanding shares of Common Stock, (C) combine the outstanding shares of Common Stock into
a smaller number of shares or (D) otherwise reclassify the outstanding shares of Common
Stock (including, without limitation, 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 Common 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 Common 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 Common
Stock transfer books of the Company were open, he would have owned upon such exercise and
been entitled to

14

 

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

          (ii) Subject to Sections 23 and 24 of this Agreement, in the event any
Person shall, at any time after the Record Date, become an Acquiring Person, unless the
event causing such Person to become an Acquiring Person is (1) a Flip-Over Event or (2) an
acquisition of shares of Common Stock pursuant to a Permitted Offer (provided that this
clause (2) shall cease to apply if such Acquiring Person thereafter becomes the Beneficial
Owner of any additional shares of Common Stock other than pursuant to such Permitted Offer
or a transaction set forth in Section 13(a) or 13(d) hereof), then, (x) the
Purchase Price shall be adjusted to be the Purchase Price immediately prior to the first
occurrence of a Flip-In Event multiplied by the number of Fractional Shares of Common Stock
for which a Right was exercisable immediately prior to such first occurrence and (y) each
holder of a Right (except as provided below in Section 11(a)(iii) and in
Section 7(e) hereof) shall thereafter have the right to receive, upon exercise
thereof at a price equal to the Purchase Price in accordance with the terms of this
Agreement, in lieu of Fractional Shares of Common Stock theretofore exercisable, such number
of shares of Common Stock of the Company as shall equal the result obtained by dividing the
Purchase Price by 50% of the Current Market Price per share of Common Stock on the date of
such first occurrence (such number of shares, the “Adjustment Shares”);
provided that the Purchase Price and the number of Adjustment Shares shall be
further adjusted as provided in this Agreement to reflect any events occurring after the
date of such first occurrence.

          (iii) In the event that the number of shares of Common Stock that are authorized by the
Company’s certificate of incorporation but not outstanding or reserved for issuance for
purposes other than upon exercise of the Rights is 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, to the extent permitted by applicable law and
regulation, (A) determine the excess of (1) the value of the Adjustment Shares issuable upon
the exercise of a Right (computed using the Current Market Price used to determine the
number of Adjustment Shares) (the “Current Value”) over (2) the Purchase Price (such
excess is herein referred to as the “Spread”), and (B) with respect to each Right,
make adequate provision to substitute for the Adjustment Shares, upon the exercise of the
Rights and payment of the applicable Purchase Price, (1) cash, (2) a reduction in the
Purchase Price, (3) Common Stock or other equity securities of the Company (including,
without limitation, shares, or units of shares, of preferred stock that the Board of
Directors of the Company has determined to have the same value as shares of Common Stock
(such shares of preferred stock are herein 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, where
such aggregate value has been determined by the Board of Directors of the Company based upon
the advice of a nationally recognized investment banking firm selected by the Board of
Directors of the Company; provided, however, if the Company shall not have
made adequate provision to deliver value pursuant to clause (B) above

15

 

within 30 days following the later of (x) the first occurrence of a Flip-In 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 “Flip-In Trigger
Date”), then the Company shall be obligated to deliver, upon the surrender for exercise
of a Right and without requiring payment of the Purchase Price, shares of Common Stock (to
the extent available) and then, if necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board of Directors of the Company shall
determine in good faith that it is likely that sufficient additional shares of Common Stock
could be authorized for issuance upon exercise in full of the Rights, the 30-day period set
forth above may be extended to the extent necessary, but not more than 120 days after the
Flip-In Trigger Date, in order that the Company may seek stockholder approval for the
authorization of such additional shares (such period, as it may be extended, the
“Substitution Period”). To the extent that the Company or the Board of Directors of
the Company determines that some action need be taken pursuant to the first and/or second
sentences of this Section 11(a)(iii), the Company (x) shall provide, subject to
Section 7(e) hereof, that such action shall apply uniformly to all outstanding
Rights, and (y) may suspend the exercisability of the Rights until the expiration of the
Substitution Period in order to seek any authorization of additional shares and/or to decide
the appropriate form of distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension, the Company shall issue a
public announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of the Common Stock
shall be the Current Market Price per share of the Common Stock on the Flip-In Trigger Date
and the value of any Common Stock Equivalent shall be deemed to have the same value as the
Common Stock on such date.

          (b) In case the Company shall fix a record date for the issuance of rights, options or
warrants to all holders of Common Stock entitling them to subscribe for or purchase (for a period
expiring within 45 calendar days after such record date) Common Stock (or shares having
substantially the same rights, privileges and preferences as the shares of Common Stock
(“Equivalent Common Stock”)) or securities convertible into Common Stock or Equivalent
Common Stock at a price per share of Common Stock or per share of Equivalent Common Stock (or
having a conversion price per share, if a security convertible into Common Stock or Equivalent
Common Stock) less than the Current Market Price per share of Common 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 Common Stock outstanding on such record date, plus the
number of shares of Common Stock that the aggregate offering price of the total number of shares of
Common Stock and/or Equivalent Common 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 Common Stock
outstanding on such record date, plus the number of additional shares of Common Stock and/or
Equivalent Common 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

16

 

Board of Directors of the Company, 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 Common Stock owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall be made successively
whenever such a record date is fixed, and in the event that such rights or warrants are not so
issued, the Purchase Price shall be adjusted to be the Purchase Price that would then be in effect
if such record date had not been fixed.

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

     (d) (i) For the purpose of any computation hereunder, other than computations made
pursuant to Section 11(a)(iii) hereof, the “Current Market Price” per share
of Common Stock of a Person on any date shall be deemed to be the average of the daily
Closing Prices per share of such Common Stock for the 30 consecutive Trading Days
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 10 consecutive Trading Days immediately following such date;
provided, however, that in the event that the Current Market Price per share
of Common Stock is determined during a period following the announcement of (A) a dividend
or distribution on such Common Stock other than a regular quarterly cash dividend or the
dividend of 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 30 Trading Day or 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. If the Common Stock is not publicly held or not so listed
or traded, “Current Market Price” per share shall mean the fair value per share as
determined in good faith by the Board of Directors of the Company, whose determination

17

 

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

          (ii) For all purposes of this Agreement, the Current Market Price of a Fractional Share
of Common Stock shall be equal to the Current Market Price of one share of Common Stock
divided by two.

          (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 1% in the
Purchase Price; provided, however, that any adjustments that by reason of this
Section 11(e) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this Section 11 shall be made to the
nearest cent or to the nearest ten-thousandth of a share of Common Stock or other share, as the
case may be or to such other figure as the Board of Directors may deem appropriate.
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 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) or
Section 13(a) hereof, the holder of any Right thereafter exercised shall become entitled to
receive in respect of such Right any shares of capital stock other than Common Stock, thereafter
the number of such other shares 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 Common Stock contained in
Sections 11(a), (b), (c), (e), (f), (g),
(h), (i), (j), (k) and (m) hereof, and the provisions of
Sections 7, 9, 10, 13 and 14 hereof with respect to the
Common Stock shall apply on like terms to any such other shares.

          (g) All Rights originally issued by the Company subsequent to any adjustment made to the
Purchase Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the
number of Fractional Shares of Common 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 Fractional Shares of Common Stock (calculated to the nearest one ten-thousandth of a
Fractional Share) obtained by (i) multiplying (x) the number of Fractional Shares of Common Stock
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 Fractional Shares of Common
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 Fractional Shares of
Common Stock for which a Right was exercisable immediately

18

 

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 ten-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 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 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 Fractional
Shares of Common Stock issuable upon the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the Purchase Price per Fractional Share
and the number of Fractional Shares that were expressed in the initial Rights Certificates issued
hereunder.

          (k) Before taking any action that would cause an adjustment reducing the Purchase Price below
the then par value, if any, or the stated capital of the number of Fractional Shares of Common
Stock or other securities issuable upon exercise of a Right, the Company shall take any corporate
action that may, in the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable such number of Fractional Shares of Common Stock or
such other securities 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 Fractional Shares of Common Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise over and above the number of
Fractional Shares of Common Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in effect prior to such adjustment;
provided, however, that the Company shall deliver to such holder a due bill or
other appropriate instrument evidencing such holder’s right to receive such additional shares
(fractional or otherwise) or securities upon the occurrence of the event requiring such adjustment.

          (m) Anything in this Section 11 to the contrary notwithstanding, the Company shall be
entitled to make such reductions in the Purchase Price, in addition to those adjustments

19

 

expressly required by this Section 11, as and to the extent that in their good faith
judgment the Board of Directors of the Company shall determine to be advisable in order that any
(i) consolidation or subdivision of the Common Stock, (ii) issuance wholly for cash of any shares
of Common Stock at less than the current market price, (iii) issuance wholly for cash of shares of
Common Stock or securities that by their terms are convertible into or exchangeable for shares of
Common Stock, (iv) stock dividends or (v) issuance of rights, options or warrants referred to in
this Section 11 hereafter made by the Company to holders of its Common Stock shall not be
taxable to such stockholders.

          (n) The Company covenants and agrees that it shall not, at any time that there is an Acquiring
Person, (i) consolidate with any other Person, (ii) merge with or into any other Person, or (iii)
sell, lease or transfer (or permit one or more Subsidiaries to sell, lease or transfer), in one
transaction or a series of related transactions, assets or earning power aggregating more than 50%
of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any other
Person or Persons, if (x) at the time of or immediately after such consolidation, merger, sale,
lease or transfer there are any rights, warrants or other instruments or securities of the Company
or any other Person outstanding or agreements, arrangements or understandings in effect that would
substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights,
(y) prior to, simultaneously with or immediately after such consolidation, merger, sale, lease or
transfer, the stockholders or other equity owners of the Person who constitutes, or would
constitute, the “Principal Party” for purposes of Section 13(a) hereof shall have
received a distribution of Rights previously owned by such Person or any of its Affiliates or
Associates, or (z) the identity, form or nature of organization of the Principal Party (including,
without limitation, the selection of the Person that will be the Principal Party as a result of the
Company’s entering into one or more consolidations, mergers, sales, leases, transfers or
transactions with more than one party) would preclude or limit the exercise of Rights or otherwise
diminish substantially or eliminate the benefits intended to be afforded by the Rights.

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

          (p) Notwithstanding Section 3(c) hereof or any other provision of this Agreement to
the contrary, in the event that the Company shall at any time after the Record 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, (iii) combine the
outstanding shares of Common Stock into a smaller number of shares or (iv) otherwise reclassify the
outstanding shares of Common Stock (including, without limitation, any such reclassification in
connection with a consolidation or merger in which the Company is the continuing or surviving
corporation), the number of Rights associated with each share of Common Stock then outstanding, or
issued or delivered thereafter with Rights, 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 “Adjustment Fraction”) the numerator of
which shall be the total number of

20

 

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. In lieu of such adjustment in the number of Rights
associated with one share of Common Stock, the Company may elect to adjust the number of Fractional
Shares of Common Stock purchasable upon the exercise of one Right and the Purchase Price. If the
Company makes such election, the number of Rights associated with one share of Common Stock shall
remain unchanged, and the number of Fractional Shares of Common Stock purchasable upon exercise of
one Right and the Purchase Price shall be proportionately adjusted so that (i) the number of
Fractional Shares of Common Stock purchasable upon exercise of a Right following such adjustment
shall equal the product of the number of Fractional Shares of Common Stock purchasable upon
exercise of a Right immediately prior to such adjustment multiplied by the Adjustment Fraction and
(ii) the Purchase Price following such adjustment shall equal the product of the Purchase Price
immediately prior to such adjustment multiplied by the Adjustment Fraction.

          Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever an
adjustment is made as provided in Section 11 or Section 13 hereof, the Company
shall (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 Common Stock, a copy of such certificate and (c) mail a brief summary
thereof to each registered holder of a Rights Certificate (or, if prior to the Distribution Date,
to each registered holder of a certificate representing shares of Common Stock) in accordance with
Section 26 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 or Earning Power.

          (a) In the event that, from and after the time an Acquiring Person has become such, directly
or indirectly, (x) the Company shall consolidate with, or merge with and into, any other Person,
and the Company shall not be the continuing or surviving corporation of such consolidation or
merger, (y) any Person shall consolidate with, or merge with or into, the Company, and the Company
shall be the continuing or surviving corporation of such consolidation or merger, and, in
connection with such consolidation or merger, all or part of the outstanding shares of Common Stock
shall be changed into or exchanged for stock or other securities of the Company or any other Person
or cash or any other property, or (z) the Company shall sell, lease or otherwise transfer (or one
or more of its Subsidiaries shall sell, lease or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any Person or Persons
(other than the Company or any wholly owned Subsidiary of the Company or any combination thereof in
one or more transactions each of which complies (and all of which together comply) 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) the Purchase Price shall be adjusted
to be the Purchase Price immediately prior to the first occurrence of a Triggering Event multiplied
by the number of Fractional Shares of Common Stock for which a Right was exercisable immediately
prior to such first occurrence; (ii) on and after the Distribution Date, each holder of a Right,
except as provided in Section 7(e)

21

 

hereof, shall thereafter have the right to receive, upon the exercise thereof at the Purchase
Price in accordance with the terms of this Agreement, in lieu of Fractional Shares of Common Stock
of the Company, such number of validly authorized and issued, fully paid, nonassessable 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 dividing the Purchase Price by 50% of the Current Market Price per
share of the Common Stock of such Principal Party on the date of consummation of such Flip-Over
Event; provided that the Purchase Price and the number of shares of Common Stock of such Principal
Party issuable upon exercise of each Right shall be further adjusted as provided in this Agreement
to reflect any events occurring after the date of such first occurrence of a Triggering Event or
after the date of such Flip-Over Event, as applicable; (iii) such Principal Party shall thereafter
be liable for, and shall assume, by virtue of such Flip-Over Event, all the obligations and duties
of the Company pursuant to this Agreement; (iv) 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 Flip-Over Event; (v) such Principal Party shall take such steps (including, without
limitation, 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 (vi) the provisions of
Section 11(a)(ii) hereof shall be of no effect following the occurrence of any Flip-Over
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), (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, or, if
there is more than one such issuer, the issuer the Common Stock of which has the greatest
aggregate market value, or (B) if no securities are so issued, (x) the Person that survives
such consolidation or is the other party to the merger and survives such merger, or, if
there is more than one such Person, the Person the Common Stock of which has the greatest
aggregate market value or (y) if the Person that is the other party to the merger does not
survive the merger, the Person that does survive the merger (including the Company if it
survives); and

     (ii) in the case of any transaction described in clause (z) of the first sentence of
Section 13(a), the Person that is the party receiving the greatest portion of the
assets or earning power transferred pursuant to such transaction or transactions, or, if
each Person that is a party to such transaction or transactions receives the same portion of
the assets or earning power so transferred, or if the Person receiving the greatest portion
of the assets or earning power cannot be determined, the Person the Common Stock of which
has the greatest aggregate market value;

provided, however, that in any such case, if the Common Stock of such Person is not
at such time and has not been continuously over the preceding twelve-month period registered under
Section 12 of the Exchange Act, and if (1) such Person is a direct or indirect Subsidiary of

22

 

another Person the Common Stock of which is and has been so registered, “Principal Party”
shall refer to such other Person; (2) such Person is a Subsidiary, directly or indirectly, of more
than one Person, the Common Stocks of all of which are and have been so registered, “Principal
Party” shall refer to whichever of such Persons is the issuer of the Common Stock having the
greatest aggregate market value; and (3) such Person is owned, directly or indirectly, by a joint
venture formed by two or more Persons that are not owned, directly or indirectly, by the same
Person, the rules set forth in (1) and (2) above shall apply to each of the chains of ownership
having an interest in such joint venture as if such party were a “Subsidiary” of both or all of
such joint venturers and the Principal Parties in each such chain shall bear the obligations set
forth in this Section 13 in the same ratio as their direct or indirect interests in such
Person bear to the total of such interests.

          (c) The Company shall not consummate any Flip-Over Event unless each Principal Party (or
Person that may become a Principal Party as a result of such Flip-Over Event) shall have a
sufficient number of authorized shares of its Common Stock that have not been issued or reserved
for issuance to permit the exercise in full of the Rights in accordance with this
Section 13 and unless prior thereto the Company and each 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 such Flip-Over Event, the Principal Party at its own expense will

     (i) prepare and file a registration statement under the Securities Act with respect to
the Rights and the securities purchasable upon exercise of the Rights on an appropriate
form, 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 Securities Act) until the Expiration
Date;

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

     (iii) use its best efforts, if the Common Stock of the Principal Party is or shall
become listed on a national securities exchange, to list (or continue the listing of) the
Rights and the securities purchasable upon exercise of the Rights on such securities
exchange and, if the Common Stock of the Principal Party shall not be listed on a national
securities exchange, to cause the Rights and the securities purchasable upon exercise of the
Rights to be reported by such transaction reporting system then in use; and

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

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

23

 

          (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 Permitted Offer (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 Common Stock whose shares were purchased pursuant to
such Permitted Offer, and (iii) the form of consideration being offered to the remaining holders of
shares of Common Stock pursuant to such transaction is the same as the form of consideration paid
pursuant to such Permitted Offer. Upon consummation of any such transaction contemplated by this
Section 13(d), all Rights hereunder shall expire.

          Section 14. Fractional Rights and Fractional Shares.

          (a) The Company shall not be required to issue fractions of Rights, except prior to the
Distribution Date as provided in Section 11(p) hereof, or to distribute Rights Certificates
or scrip evidencing fractional Rights. In lieu of such fractional Rights, there shall be paid to
the registered holders of the Rights Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the Closing Price of one
Right for the Trading Day immediately prior to the date on which such fractional Rights would have
been otherwise issuable.

          (b) The Company shall not be required to issue fractions of shares of Common Stock (other
than, except as provided in Section 7(c) hereof, fractions that are integral multiples of a
Fractional Share of Common Stock) upon exercise of the Rights or to distribute certificates or
scrip evidencing fractional shares of Common Stock (other than, except as provided in
Section 7(c) hereof, fractions that are integral multiples of a Fractional Share of Common
Stock). Interests in fractions of shares of Common Stock in integral multiples of a Fractional
Share of Common Stock may, at the election of the Company in its sole discretion, be evidenced by
depositary receipts, pursuant to an appropriate agreement between the Company and a depositary
selected by it, provided that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they are entitled as
beneficial owners of the shares of Common Stock represented by such depositary receipts. In lieu
of fractional shares of Common Stock that are not integral multiples of a Fractional Share 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 one
one-half of the Closing Price of a share of Common Stock 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 or
scrip evidencing 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 Closing Price of
one share of Common Stock for the Trading Day immediately prior to the date of such exercise.

24

 

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

          Section 15. Rights of Action. All rights of action in respect of this Agreement,
other than rights of action vested in the Rights Agent pursuant to Section 18 hereof, are
vested in the respective registered holders of the Rights Certificates (and, prior to the
Distribution Date, the registered holders of the Common Stock) and, where applicable, the Company;
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. After a Triggering Event, holders of Rights
shall be entitled to recover the reasonable costs and expenses, including, without limitation,
attorneys’ fees, incurred by them in any action to enforce the provisions of 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 not be evidenced by Rights Certificates
and will be transferable only in connection with the transfer of Common Stock;

          (b) after the Distribution Date, the Rights Certificates will be 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 form of assignment set forth on the reverse side thereof and the certificate contained
therein duly completed and fully executed;

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

          (d) notwithstanding anything in this Agreement to the contrary, neither the Company nor the
Rights Agent shall have any liability to any holder of a Right or other Person as a result of its
inability to perform any of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of

25

 

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 Fractional Shares of Common Stock or any other securities of the
Company that may at any time be issuable upon the exercise of the Rights represented thereby, nor
shall anything contained herein or in any 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 reasonable disbursements incurred in the
administration and execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless
against, any loss, liability or expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement, including, without limitation,
the costs and expenses of defending against any claim of liability in connection therewith.

          (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, after
proper inquiry or examination, to be genuine and to be signed, executed and, where necessary,
guaranteed, 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 or stock transfer business of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this

26

 

Agreement without the execution or filing of any paper or any further act on the part of any
of the parties hereto; provided, however, that such corporation would be eligible
for appointment as a successor Rights Agent under the provisions of Section 21 hereof. In
case at the time such successor Rights Agent shall succeed to the agency created by this Agreement,
any of the Rights Certificates shall have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights Certificates shall not
have been countersigned, any successor Rights Agent may countersign such Rights Certificates either
in the name of the predecessor or in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in the Rights Certificates and in this
Agreement.

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

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

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

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

          (c) The Rights Agent shall be liable hereunder only for its own gross negligence, bad faith or
willful misconduct. In no event shall the Rights Agent be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including, without limitation, lost profits),
even if the Rights Agent has been advised of the likelihood of such loss or damage and regardless
of the form of action.

27

 

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

          (e) The Rights Agent shall not be under any responsibility in respect of the validity of this
Agreement or the execution and delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Rights Certificate; nor shall it be
responsible for any adjustment required under the provisions of Section 11 or
Section 13 hereof or responsible for the manner, method or amount of any such adjustment or
the ascertaining of the existence of facts that would require any such adjustment (except with
respect to the exercise of Rights evidenced by Rights Certificates after receipt of actual
knowledge 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
other securities to be issued pursuant to this Agreement or any Rights Certificate or as to whether
any shares of Common Stock or other securities 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, the Chief Executive
Officer, the President, any Executive Vice President, the Secretary, any Assistant Secretary or the
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, omission, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company resulting from any such
act, omission, default, neglect or misconduct; provided, however, that reasonable
care was exercised in the selection and continued employment thereof.

28

 

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

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

          (l) The Rights Agent shall coordinate and cooperate with the Transfer Agent.

     (ii) The Transfer Agent acknowledges all of the terms and conditions of this Agreement and
agrees to coordinate and cooperate with, and make all of its records available to, the Rights
Agent. To the extent that any shares of Common Stock are to be issued pursuant to this Rights
Agreement, the Transfer Agent shall take such steps as are necessary to cause such shares to be
delivered in accordance with the terms and conditions of this Agreement and reflected in the share
register of the Company.

          Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent
may resign and be discharged from its duties under this Agreement upon 30 days’ notice in writing
mailed to the Company, and to each transfer agent of the Common Stock by registered or certified
mail, and to the registered holders, if any, of the Rights Certificates by first-class mail. In
the event the transfer agency relationship in effect between the Company and the Rights Agent’s
affiliate, Computershare Investor Services, LLC, terminates, the Rights Agent will be deemed to
have resigned automatically and be discharged from its duties under this Agreement as of the
effective date of such termination, and the Company shall be responsible for sending any required
notice. The Company may remove the Rights Agent or any successor Rights Agent (with or without
cause) upon 30 days’ notice in writing, mailed to the Rights Agent or successor Rights Agent, as
the case may be, and to each transfer agent of the Common Stock, by registered or certified mail,
and to the registered holders of the Rights Certificates, if any, 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. Notwithstanding the foregoing provisions of this
Section 21, in no event shall the resignation or removal of a Rights Agent be effective
until a successor Rights Agent shall have been appointed and have accepted such appointment. If
the Company shall fail to make such appointment within a period of 30 days after giving notice of
such removal or after it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the registered holder of a Rights Certificate (who
shall, with such notice, submit his Rights Certificate for inspection by the Company), then the
Rights Agent or the registered holder of any Rights Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be (a) an entity organized and doing business
under the laws of the United States or any state thereof, in good standing, which is authorized
under such laws to exercise corporate trust or stock transfer powers and is subject to supervision
or examination by federal or state authority

29

 

and which has at the time of its appointment as Rights Agent a combined capital and surplus of
at least $10,000,000 or (b) an Affiliate of a corporation or trust company 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 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 its Board of
Directors of the Company 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 following the Distribution Date and prior to
the Expiration Date, 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 on or prior to the Distribution Date, or upon the exercise, conversion or exchange of
securities issued by the Company on or prior to the Distribution Date, and (b) may, in any other
case, if deemed necessary or appropriate by the Board of Directors of the Company, issue Rights
Certificates representing the appropriate number of Rights in connection with such issuance or
sale; provided, however, that (i) no such Rights Certificate shall be issued 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 Board of Directors of the Company may, at its option, at any time prior to the earlier
of (i) the close of business on the tenth day following the first date of public announcement of
the occurrence of a Flip-In Event and (ii) the Expiration Date, cause the Company to redeem all but
not less than all the then outstanding Rights at a redemption price of $0.01 per Right, as such
amount may be appropriately adjusted, if necessary, to reflect any stock split, stock dividend or
similar transaction (such redemption price being hereinafter referred to as the “Redemption
Price”); provided, however, that the Rights may not be redeemed following any
merger to which the Company is a party that (i) occurs when there is an Acquiring Person and (ii)
was not approved prior to such merger by the Board of Directors of the Company and by the
stockholders of the Company at a stockholders’ meeting. Notwithstanding anything contained in this
Agreement to the contrary, the Rights shall not be exercisable after the first occurrence of a

30

 

Flip-In 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 of the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors of the Company.

          (b) Immediately upon the effectiveness of the action of the Board of Directors of the Company
ordering the redemption of the Rights (the effectiveness of which action may be conditioned on the
occurrence of one or more events or on the existence of one or more facts or may be effective at
some future time), evidence of which shall be 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 effectiveness of 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 registered 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 Company for the Common Stock. Any notice that
is mailed in the manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of redemption shall state the method by which the payment of the
Redemption Price will be made.

          Section 24. Exchange.

          (a) The Board of Directors of the Company may, at its option, at any time and from time to
time after the occurrence of a Flip-In Event, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have become void pursuant to the provisions
of Section 7(e) hereof) for shares of Common Stock or Common Stock Equivalents or any
combination thereof, at an exchange ratio of one share of Common Stock, or such number of Common
Stock Equivalents or units representing fractions thereof as would be deemed to have the same value
as one share of Common Stock, per Right, appropriately adjusted, if necessary, to reflect any stock
split, stock dividend or similar transaction (such exchange ratio being hereinafter referred to as
the “Exchange Ratio”). Notwithstanding the foregoing, the Board of Directors may not
effect such exchange at any time after (i) any Person (other than an Exempt Person), together with
all Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or more of the
shares of Common Stock then outstanding or (ii) the occurrence of a Flip-Over Event.

          (b) Immediately upon the effectiveness of the action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to and in accordance with subsection (a) of this
Section 24 (the effectiveness of which action may be conditioned on the occurrence of one
or more events or on the existence of one or more facts or may be effective at some future time)
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 and/or Common Stock Equivalents 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 registered holders of such Rights at their

31

 

last addresses as they appear upon the registry books of the Rights Agent. Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of exchange will state the method by which the exchange of the shares
of Common Stock and/or Common Stock Equivalents for Rights will be effected and, in the event of
any partial exchange, the number of Rights that will be exchanged. Any partial exchange shall be
effected as nearly pro rata as possible based on the number of Rights (other than Rights that have
become void pursuant to the provisions of Section 7(e) hereof) held by each holder of
Rights.

          (c) In the event that the number of shares of Common Stock that are authorized by the
Company’s certificate of incorporation but not outstanding or reserved for issuance for purposes
other than upon exercise of the Rights is not sufficient to permit an exchange of Rights as
contemplated in accordance with this Section 24, the Company may, at its option, take all
such action as may be necessary to authorize additional shares of Common Stock for issuance upon
exchange of the Rights.

          (d) The Company shall not be required to issue fractions of shares of Common Stock or to
distribute certificates or scrip evidencing fractional shares of Common Stock upon exchange of the
Rights. In lieu of such fractional shares of Common Stock, the Company shall pay to the registered
holders of Rights 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 value of a whole share of Common
Stock. For purposes of this Section 24, the value of a whole share of Common Stock shall
be the Closing Price per share of Common Stock for the Trading Day immediately prior to the date of
exchange pursuant to this Section 24, and the value of any Common Stock Equivalent shall be
deemed to have the same value as the Common Stock on such date.

          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 Common Stock or to make any other
distribution to the holders of Common 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 Common Stock
rights or warrants to subscribe for or to purchase any additional shares of Common Stock or shares
of stock of any class or any other securities, rights or options, or (iii) to effect any
reclassification of its Common Stock (other than a reclassification involving only the subdivision
of outstanding shares of Common Stock), or (iv) to effect any consolidation or merger into or with
any other Person (other than a wholly owned Subsidiary of the Company in a transaction that
complies with Section 11(o) hereof), or to effect any sale, lease or other transfer of all
or substantially all the Company’s assets to any other Person or Persons (other than a wholly owned
Subsidiary of the Company in a transaction that 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 record 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, lease, transfer, liquidation,
dissolution or winding up is to take place and the date of participation therein by the holders of

32

 

the shares of Common Stock, if any such date is to be fixed, and such notice shall be so given
in the case of any action covered by clause (i) or (ii) above at least 20 days prior to the record
date for determining holders of the shares of Common Stock for purposes of such action, and in the
case of any such other action, at least 20 days prior to the date of the taking of such proposed
action or the date of participation therein by the holders of the shares of Common Stock, whichever
shall be the earlier. The failure to give notice required by this Section 25 or any defect
therein shall not affect the legality or validity of the action taken by the Company or the vote
upon any such action.

          (b) In case any Flip-In Event or Flip-Over Event shall occur, then (i) the Company shall as
soon as practicable thereafter give to each registered holder of a Rights Certificate (or if
occurring prior to the Distribution Date, the registered holders of Common Stock), 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) or
Section 13(a) hereof, and (ii) all references in the preceding paragraph to Common 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 with the Rights Agent) as follows:

SPSS Inc.

233 South Wacker Drive, 11th Floor

Chicago, Illinois 60606

Attention: Corporate Secretary

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

Computershare Trust Company, N.A.

2 North LaSalle Street

Chicago, Illinois 60602

Attention: Relationship Manager

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

          Section 27. Supplements and Amendments. Except as provided in the last sentence of
this Section 27, at any time when the Rights are then redeemable, the Company may in its
sole and absolute discretion and the Rights Agent shall, if the Company so directs,

33

 

supplement or amend any provision of this Agreement in any respect without the approval of any
holders of Rights or holders of Common Stock. At any time when the Rights are not redeemable,
except as provided in the last sentence of this Section 27, the Company may and the Rights
Agent shall, if the Company so directs, supplement or amend this Agreement without the approval of
any holders of Rights in order (i) to cure any ambiguity, (ii) to correct or supplement any
provision contained herein that 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 that the Company may deem necessary or desirable; provided that
no such amendment or supplement shall materially adversely affect the interests of the holders of
Rights (other than an Acquiring Person or an Affiliate or Associate of an Acquiring Person); and
further provided that this Agreement may not be supplemented or amended pursuant to this sentence
to lengthen (A) a time period relating to when the Rights may be redeemed or (B) any other time
period unless the lengthening of such other time period is for the purpose of protecting, enhancing
or clarifying the rights of, and/or the benefits to, the holders of Rights (other than any
Acquiring Person and its Affiliates and Associates). 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; provided, however, that the Rights Agent may, but shall
not be obligated to, enter into any such supplement or amendment that affects the Rights Agent’s
own rights, duties or immunities under this Agreement. Notwithstanding anything contained in this
Agreement to the contrary, no supplement or amendment shall be made that decreases the Redemption
Price.

          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, subject to
the last sentence of the definition of Beneficial Owner in Section 1, 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 as in effect on the date of this Agreement. The Board of Directors of the Company
(or, as set forth herein, certain specified members thereof) 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 of the Company 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, without limitation, a determination
to redeem or not redeem the Rights or to amend this Agreement). All such actions, calculations,
interpretations and determinations (including for purposes of clause (y) below, all omissions with
respect to the foregoing) that are done or made by the Board of Directors of the Company in good
faith, shall (x) be final, conclusive and binding on the Company, the Rights Agent, the holders of
the Rights, as such, and all other Persons, and (y) not subject the Board of Directors to any
liability to the holders of the Rights.

34

 

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

          Section 31. Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this Agreement to the contrary,
if any such term, provision, covenant or restriction is held by such court or authority to be
invalid, void or unenforceable and the Board of Directors of the Company determines in its good
faith judgment that severing the invalid language from this Agreement would adversely affect the
purpose or effect of this Agreement, then, unless there has occurred any merger referred to in the
proviso to the first sentence of Section 23(a), 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 of the Company or,
if earlier, immediately prior to any such merger. Without limiting the foregoing, if any provision
requiring that a determination be made by less than the entire Board of Directors of the Company is
held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable,
such determination shall then be made by the entire Board of Directors of the Company.

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

          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.

          Section 35. Force Majeure. Notwithstanding anything to the contrary contained herein,
the Rights Agent shall not be liable for any delays or failures in performance resulting from acts
beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage
of supply, breakdowns, interruptions or malfunction of computer facilities, or loss of data due to
power failures or mechanical difficulties with information storage or retrieval systems, labor
difficulties, war, or civil unrest.

[Signature page follows]

35

 

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

	 	 	 	 	 	 	 
	 	 	SPSS INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Raymond H. Panza	 	 
	 

	 	Name:
	 	 

Raymond H. Panza
		 
	 

	 	Title:	 	EVP, Corporate Operations &  CFO	 	 
	 
	 	 	 	 	 	 
	 	 	COMPUTERSHARE TRUST COMPANY, N.A. as Rights Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Dennis V. Moccia	 	 
	 

	 	Name:
	 	 

Dennis V. Moccia
	 	 
	 

	 	Title:	 	Managing Director	 	 
	 
	 	 	 	 	 	 
	 	 	COMPUTERSHARE INVESTOR SERVICES, L.L.C., as Transfer Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Dennis V. Moccia	 	 
	 

	 	Name:
	 	 

Dennis V. Moccia
	 	 
	 

	 	Title:	 	Managing Director	 	 

36

 

Exhibit A

[Form of Rights Certificate]

			
	Certificate No. R-
	 	                     Rights

NOT EXERCISABLE AFTER JUNE 18, 2018 OR EARLIER IF REDEEMED OR EXCHANGED BY THE COMPANY. THE RIGHTS
ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT ON THE TERMS SET FORTH
IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
BENEFICIALLY OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN
TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.

RIGHTS CERTIFICATE

SPSS 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 Rights Agreement, dated as of June 18, 2008, as it may from
time to time be supplemented or amended (the “Rights Agreement”), between SPSS Inc., a
Delaware corporation (the “Company”), and Computershare Trust Company, N.A., a Delaware
limited liability company (the “Rights Agent”), to purchase from the Company at any time
prior to 5:00 p.m. (New York City time) on June 18, 2018 at the principal office or offices of the
Rights Agent designated for such purpose, or its successors as Rights Agent, one one-half of a
fully paid, nonassessable share (a “Fractional Share”) of Common Stock (the “Common
Stock”) of the Company, at a purchase price of $175 per one one-half of a share (the
“Purchase Price”), upon presentation and surrender of this Rights Certificate with the Form
of Election to Purchase and related Certificate set forth on the reverse hereof duly executed. The
Purchase Price may be paid in cash or by certified check, cashier’s or official bank check or bank
draft payable to the order of the Company or the Rights Agent. 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 Fractional Share set forth above, are the number and
Purchase Price as of June 18, 2008, based on the Common 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 Common Stock will be issued.

     From and after the first occurrence of a Triggering Event (as such term is defined in the
Rights Agreement), if the Rights evidenced by this Rights Certificate are beneficially owned by or
transferred to (i) an Acquiring Person or an Associate or Affiliate of an 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

A-1

 

transferee of a person who, concurrently with or after such transfer, became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person, such Rights shall, with certain
exceptions, become null and void in the circumstances set forth in the Rights Agreement, and no
holder hereof shall have any rights whatsoever with respect to such Rights from and after the
occurrence of such Triggering Event.

     As provided in the Rights Agreement, the Purchase Price and the number and kind of shares of
Common Stock or other securities or assets that 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, without limitation, 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
Company or 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 Fractional Shares of Common 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
(i) may be redeemed by the Company at its option at a redemption price of $0.01 per Right, payable,
at the election of the Company, in cash or shares of Common Stock or such other consideration as
the Board of Directors may determine, at any time prior to the earlier of the close of business on
(a) the tenth day following the first public announcement of the occurrence of a Flip-In Event (as
such time period may be extended or shortened pursuant to the Rights Agreement) and (b) the
Expiration Date (as such term is defined in the Rights Agreement) or (ii) may be exchanged in whole
or in part for shares of the Company’s Common Stock, par value $0.01 per share, and/or other equity
securities of the Company deemed to have the same value as shares of Common Stock, at any time
prior to a person’s becoming the beneficial owner of 50% or more of the shares of Common Stock
outstanding or the occurrence of a Flip-Over Event.

     No fractional shares of Common Stock are required to be issued upon the exercise of any Right
or Rights evidenced hereby (other than, except as set forth above, fractions that are integral
multiples of a Fractional Share of Common Stock, which may, at the election of the Company, be
evidenced by depositary receipts), but in lieu thereof a cash payment may be made, as provided in
the Rights Agreement.

A-2

 

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

	 	 	 	 	 	 	 	 	 
	Dated as of                     ,
         

	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	SPSS INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By	 	 	 	 
	 

Title:

	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	Countersigned:
	 	 	 	 	 	 	 	 

By:                                                   

      Authorized Signature

A-3

 

[Form of Reverse Side of Rights Certificate]

FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires

to transfer any Rights evidenced by the Rights Certificate.)

	 	 	 	 	 
	FOR VALUE RECEIVED

	 	 

	 	hereby sells, 
	 
	 	 	 	 
	assigns and transfers unto

	 	 

	 
	 	 	 	 

 

(Please print name and address of transferee)

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

Dated:                     , 20         

                                                            

Signature

Signature Guaranteed:

Signatures must be guaranteed by a member firm of a national securities exchange, a member of the
National Association of Securities Dealers, Inc., a commercial bank or trust company having an
office or correspondent in the United States or another eligible guarantor institution (as defined
pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended).

A-4

 

CERTIFICATE

     The undersigned hereby certifies by checking the appropriate boxes that:

     (1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not being sold, assigned
and transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms are defined 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 or who is a direct
or indirect transferee of an Acquiring Person or of an Affiliate or Associate of an Acquiring
Person.

	 	 	 
	Dated:                               ,
         

	 	                                                            
	 

	 	Signature

Signature Guaranteed:

Signatures must be guaranteed by a member firm of a national securities exchange, a member of the
National Association of Securities Dealers, Inc., a commercial bank or trust company having an
office or correspondent in the United States or another eligible guarantor institution (as defined
pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended).

NOTICE

     The signatures 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.

A-5

 

FORM OF ELECTION TO PURCHASE

(To be executed if holder desires to exercise

Rights represented by the Rights Certificate)

To:      SPSS Inc.

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

Signatures must be guaranteed by a member firm of a national securities exchange, a member of the
National Association of Securities Dealers, Inc., a commercial bank or trust company having an
office or correspondent in the United States or another eligible guarantor institution (as defined
pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended).

A-6

 

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 an
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 or who is a direct
or indirect transferee of an Acquiring Person or of an Affiliate or Associate of an Acquiring
Person.

	 	 	 
	Dated:                    ,          

	 	                                                            
	 

	 	Signature

Signature Guaranteed:

Signatures must be guaranteed by a member firm of a national securities exchange, a member of
the National Association of Securities Dealers, Inc., a commercial bank or trust company having an
office or correspondent in the United States or another eligible guarantor institution (as defined
pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended).

NOTICE

     The signatures 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.exv4w1

OMNIBUS INSTRUMENT

     WHEREAS, the parties named herein desire to enter into certain Program Documents, by executing
this Omnibus Instrument dated as of June 13, 2008, relating to the issuance by Principal Life
Income Fundings Trust 2008-50 (the “Trust”) of Notes with a principal amount of $3,088,000 to
investors under Principal Life’s secured notes program;

     WHEREAS, the Trust is a trust and will be organized under and its activities will be governed
by the provisions of the Trust Agreement (set forth in Section A of this Omnibus Instrument), dated
as of the date specified herein, by and between the parties thereto indicated in Section F herein;

     WHEREAS, certain expense and indemnification arrangements between Principal Life and the
Trustee, on behalf of itself and on behalf of the Trust, are governed pursuant to the provisions of
the Expense and Indemnity Agreement dated as of November 21, 2007, by and between Principal Life
and the Trustee;

     WHEREAS, certain licensing arrangements between the Trust and Principal Financial Services,
Inc. will be governed pursuant to the provisions of the License Agreement (set forth in Section B
of this Omnibus Instrument), dated as of the date specified herein, by and between the parties
thereto indicated in Section F herein;

     WHEREAS, certain custodial arrangements of the Funding Agreement and the Guarantee will be
governed pursuant to the provisions of the Custodial Agreement (the “Custodial Agreement”) dated as
of November 21, 2007 by and among Bankers Trust Company, N.A., acting as custodian (the
“Custodian”), the Indenture Trustee and the Trustee, on behalf of the Trust;

     WHEREAS, the Notes will be issued pursuant to the Indenture (set forth in Section C of this
Omnibus Instrument), dated as of the date specified herein, by and between the parties thereto
indicated in Section F herein;

     WHEREAS, the sale of the Notes will be governed by the Terms Agreement (set forth in Section D
of this Omnibus Instrument), dated as of the date specified herein, by and among the parties
thereto indicated in Section F herein; and

     WHEREAS, certain agreements relating to the Notes, the Funding Agreement and the Guarantee are
set forth in the Coordination Agreement (set forth in Section E of this Omnibus Instrument), dated
as of the date specified herein, by and among the parties thereto indicated in Section F herein.

     All capitalized terms used herein and not otherwise defined will have the meanings set forth
in the Indenture.

[Remainder of Page Left Intentionally Blank.]

 

 

SECTION A

TRUST AGREEMENT

     This TRUST AGREEMENT (this “Trust Agreement”), dated as of the date of the Omnibus Instrument,
is entered into by and between GSS Holdings II, Inc., a Delaware corporation, as trust beneficial
owner (the “Trust Beneficial Owner”), and U.S. Bank Trust National Association, a national banking
association, as Trustee (the “Trustee”).

WITNESSETH:

     WHEREAS, the Trust Beneficial Owner and the Trustee desire to authorize the issuance of a
Trust Beneficial Interest and a series of Notes in connection with the entry into this Trust
Agreement;

     WHEREAS, all things necessary to make this Trust Agreement a valid and legally binding
agreement of the Trustee and the Trust Beneficial Owner, enforceable in accordance with its terms,
have been done;

     WHEREAS, the parties intend to provide for, among other things, (i) the issuance and sale of
the Notes (pursuant to the Indenture, the Distribution Agreement and the related Terms Agreement)
and the Trust Beneficial Interest, (ii) the use of the proceeds of the sale of the Notes and Trust
Beneficial Interest to acquire the Funding Agreement, the payment obligations of which will be
fully and unconditionally guaranteed by the Guarantee, and (iii) all other actions deemed necessary
or desirable in connection with the transactions contemplated by this Trust Agreement; and

     WHEREAS, the parties hereto desire to incorporate by reference those certain Standard Trust
Terms, dated as of November 21, 2007, and attached to the Omnibus Instrument as Exhibit A
(the “Standard Trust Terms”) and all capitalized terms not otherwise defined herein (including the
recitals hereof) shall have the meanings set forth in the Standard Trust Terms (the Standard Trust
Terms and this Trust Agreement, collectively, the “Trust Agreement”).

     NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for
other good and valuable consideration, the sufficiency of which are hereby acknowledged, each party
hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and agreements set
forth in the Standard Trust Terms (except to the extent expressly modified herein) are hereby
incorporated herein by reference with the same force and effect as though fully set forth herein.
To the extent that the terms set forth in Article 2 of this Trust Agreement are inconsistent with
the terms of the Standard Trust Terms, the terms set forth in Article 2 herein shall apply.

A-1

 

ARTICLE 2

     Section 2.01 Name. The Trust created and governed by the Trust Agreement shall be
the trust specified in the Omnibus Instrument. The name of the Trust shall be the name specified
in the first paragraph of the Omnibus Instrument, as such name may be modified from time to time by
the Trustee following written notice to the Trust Beneficial Owner.

     Section 2.02 Jurisdiction. The Trust is hereby organized in, and formed under and
pursuant to, the laws of the State of New York.

     Section 2.03 Initial Capital Contribution and Ownership. The Trust Beneficial Owner
has paid or has caused to be paid to, or to an account at the direction of, the Trustee, on the
date hereof, the sum of $15 (or, in the case of Notes issued with original issue discount, such
amount multiplied by the issue price of the Notes). The Trustee hereby acknowledges receipt in
trust from the Trust Beneficial Owner, as of the date hereof, of the foregoing contribution, which
shall be used along with the proceeds from the sale of the series of Notes to purchase the Funding
Agreement. Upon the creation of the Trust and the registration of the Trust Beneficial Interest in
the Securities Register (as defined in the Trust Agreement) by the Registrar in the name of the
Trust Beneficial Owner, the Trust Beneficial Owner shall be the sole beneficial owner of the Trust.

     Section 2.04 Acknowledgment. The Trustee, on behalf of the Trust, expressly
acknowledges its duties and obligations set forth in the Standard Trust Terms incorporated herein.

     Section 2.05 Additional Terms.

     None.

     Section 2.06 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the Trust Agreement will enter into the Trust Agreement by executing the
Omnibus Instrument.

     By executing the Omnibus Instrument, the Trustee and the Trust Beneficial Owner hereby agree
that the Trust Agreement will constitute a legal, valid and binding agreement between the Trustee
and the Trust Beneficial Owner.

     All terms relating to the Trust or the series of Notes not otherwise included in the Trust
Agreement will be as specified in the Omnibus Instrument, the Pricing Supplement (attached to this
Omnibus Instrument as Exhibit D) (the “Pricing Supplement”) or the Distribution Agreement
as indicated herein.

A-2

 

     Section 2.07 Governing Law. The Trust Agreement will be governed by, and construed
in accordance with, the laws of the State of New York.

     Section 2.08 Counterparts. The Trust Agreement, through the Omnibus Instrument, may
be executed in any number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute but one and the same instrument.

[Remainder of Page Left Intentionally Blank.]

A-3

 

SECTION B

LICENSE AGREEMENT

     This LICENSE AGREEMENT (this “License Agreement”), dated as of the date of the Pricing
Supplement, is entered into by and between Principal Financial Services, Inc., an Iowa corporation
with its principal place of business at 711 High Street, Des Moines, Iowa 50392 (the “Licensor”),
and the Principal Life Income Fundings Trust specified in the Omnibus Instrument (the “Licensee”).

WITNESSETH:

     WHEREAS, the Licensor is the owner of certain trademarks and service marks and registrations
and pending applications therefor, and may acquire additional trademarks and service marks in the
future, all as described more fully below;

     WHEREAS, the Licensee desires to use certain of the Licensor’s trademarks and service marks in
connection with the Licensee’s activities, as described more fully below;

     WHEREAS, the Licensor and the Licensee wish to formalize the agreement between them regarding
the Licensee’s use of the Licensor’s marks; and

     WHEREAS, the parties hereto desire to incorporate by reference those certain Standard License
Agreement Terms, dated March 5, 2004, and attached to the Omnibus Instrument as Exhibit B
(the “Standard License Agreement Terms”) and all capitalized terms not otherwise defined herein
(including the recitals hereof) shall have the meanings set forth in the Standard License Agreement
Terms (the Standard License Agreement Terms and this License Agreement, collectively, the “License
Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein and for other good
and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, each
party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and agreements set
forth in the Standard License Agreement Terms (except to the extent expressly modified herein) are
hereby incorporated herein by reference with the same force and effect as though fully set forth
herein. To the extent that the terms set forth in Article 2 of this License Agreement are
inconsistent with the terms of the Standard License Agreement Terms, the terms set forth in Article
2 herein shall apply.

ARTICLE 2

     Section 2.01 Additional Terms.

     None.

B-1

 

     Section 2.02 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the License Agreement will enter into the License Agreement by executing the
Omnibus Instrument.

     By executing the Omnibus Instrument, the Licensor and the Licensee hereby agree that the
License Agreement will constitute a legal, valid and binding agreement between the Licensor and the
Licensee.

     All terms relating to the Trust or the Notes not otherwise included in the License Agreement
will be as specified in the Omnibus Instrument or Pricing Supplement, as indicated herein.

     Section 2.03 Counterparts. The License Agreement, through the Omnibus Instrument,
may be executed in any number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute but one and the same instrument.

[Remainder of Page Left Intentionally Blank.]

B-2

 

SECTION C

INDENTURE

     This INDENTURE (this “Indenture”) is entered into as of the Original Issue Date by and between
the Principal Life Income Fundings Trust specified in the Omnibus Instrument (the “Trust”) and
Citibank, N.A., as indenture trustee (the “Indenture Trustee”).

     Citibank, N.A., in its capacity as indenture trustee, hereby accepts its role as Registrar,
Paying Agent, Transfer Agent and Calculation Agent hereunder.

     References herein to “Indenture Trustee,” “Registrar,” “Transfer Agent,” “Paying Agent” or
“Calculation Agent” shall include the permitted successors and assigns of any such entity from time
to time.

WITNESSETH:

     WHEREAS, the Trust has duly authorized the execution and delivery of this Indenture to provide
for the issuance of Notes;

     WHEREAS, all things necessary to make this Indenture a valid and legally binding agreement of
the Trust and the other parties to this Indenture, enforceable in accordance with its terms, have
been done, and the Trust proposes to do all things necessary to make the Notes, when executed by
the Trust and authenticated and delivered pursuant hereto, valid and legally binding obligations of
the Trust as hereinafter provided; and

     WHEREAS, the parties hereto desire to incorporate by reference those certain Standard
Indenture Terms, dated as of May 2, 2008, and attached to the Omnibus Instrument as
Exhibit C (the “Standard Indenture Terms”) and all capitalized terms not otherwise defined
herein (including the recitals hereof) shall have the meanings set forth in the Standard Indenture
Terms (the Standard Indenture Terms and this Indenture, collectively, the “Indenture”).

     NOW, THEREFORE, for and in consideration of the premises and the purchase of the Notes by the
Holders thereof, it is mutually covenanted and agreed by each of the parties hereto as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and agreements set
forth in the Standard Indenture Terms (except to the extent expressly modified herein) are hereby
incorporated herein by reference (with the same force and effect as though fully set forth herein).
To the extent that the terms set forth in Article 2 of this Indenture are inconsistent with the
terms of the Standard Indenture Terms, the terms set forth in Article 2 herein shall apply.

C-1

 

ARTICLE 2

     Section 2.01 Agreement to be Bound. Each of the Trust, the Indenture Trustee, the
Registrar, the Transfer Agent, the Paying Agent and the Calculation Agent hereby agrees to be bound
by all of the terms, provisions and agreements set forth in the Indenture, with respect to all
matters contemplated in the Indenture, including, without limitation, those relating to the
issuance of the below-referenced Notes.

     Section 2.02 Designation of the Trust, the Notes, the Funding Agreement and the
Guarantee. The Trust created by the Trust Agreement and referred to in the Indenture is the
Principal Life Income Fundings Trust specified in the Omnibus Instrument. The Notes issued by the
Trust and governed by the Indenture shall be the Notes specified in the Pricing Supplement. The
Funding Agreement designated hereby is the Funding Agreement designated in the Pricing Supplement
dated as of the Original Issue Date between the Trust and Principal Life. The Guarantee designated
hereby is the Guarantee dated as of the Original Issue Date of PFG.

     Section 2.03 Additional Terms.

     None.

     Section 2.04 Omnibus Instrument; Execution and Incorporation of Terms. 

     The parties to the Indenture will enter into the Indenture by executing the Omnibus
Instrument.

     By executing the Omnibus Instrument, the Indenture Trustee, the Registrar, the Transfer Agent,
the Paying Agent, the Calculation Agent and the Trust hereby agree that the Indenture will
constitute a legal, valid and binding agreement between the Indenture Trustee, the Registrar, the
Transfer Agent, the Paying Agent, the Calculation Agent and the Trust.

     All terms relating to the Trust or the Notes not otherwise included in the Indenture will be
as specified in the Omnibus Instrument or Pricing Supplement, as indicated herein.

     Section 2.05 Counterparts. The Indenture, through the Omnibus Instrument, may be
executed in any number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute one and the same instrument.

[Remainder of Page Left Intentionally Blank.]

C-2

 

SECTION D

TERMS AGREEMENT

     This TERMS AGREEMENT (this “Terms Agreement”) is entered into as of the date of the Omnibus
Instrument by and among Principal Life Insurance Company (“Principal Life”), Principal Financial
Group, Inc. (“PFG”), the Principal Life Income Fundings Trust specified in the Omnibus Instrument
(the “Trust”) and the Purchasing Agent(s) specified in the Pricing Supplement (the “Purchasing
Agent”).

WITNESSETH:

     WHEREAS, Principal Life, PFG and the agents named therein, including the Purchasing Agent have
entered into that certain Distribution Agreement dated November 21, 2007 (the “Distribution
Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein and other good and
valuable consideration, the sufficiency and receipt of which are hereby acknowledged, each of the
parties hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. The provisions of the Distribution
Agreement and the related definitions (unless otherwise specified herein) are incorporated by
reference herein and shall be deemed to have the same force and effect as if set forth in full
herein.

ARTICLE 2

     Section 2.01 Addition of Trust as Party to Distribution Agreement.

     Pursuant to Section 1 of the Distribution Agreement, each of the undersigned parties
hereby acknowledges and agrees that the Trust, upon execution hereof by the Trust and the other
parties to the Distribution Agreement (other than any other trusts organized in connection with the
Registration Statement that are party thereto as of the date hereof), shall become a Trust for
purposes of the Distribution Agreement in accordance with the terms thereof, in respect of the
Notes, with all the authority, rights, powers, duties and obligations of a Trust under the
Distribution Agreement. The Trust confirms that any agreement, covenant, acknowledgment,
representation or warranty under the Distribution Agreement applicable to the Trust is made by the
Trust at the date hereof, unless another time or times are specified in the Distribution Agreement,
in which case such agreement, covenant, acknowledgment, representation or warranty shall be deemed
to be confirmed by the Trust at such specified time or times.

     Section 2.02 Purchase of Notes as Principal.

     (a) Subject in all respects to the terms and conditions of the Distribution Agreement, the
Trust hereby agrees to sell to the Purchasing Agent and the Purchasing Agent hereby agrees to
purchase the Notes having the terms specified in the Pricing Supplement relating to such Notes.

D-1

 

     (b) In connection with any purchase of Notes from the Trust by the Purchasing Agent as
principal, the parties agree that the items specified on Schedule I of the Omnibus Instrument will
be delivered as of the Settlement Date.

     Section 2.03 Termination. Upon the termination of this Terms Agreement pursuant to
Section 13(b) of the Distribution Agreement the undersigned parties hereby agree to that the
expenses reasonably incurred prior to or in connection with such termination will be borne by
Principal Life and PFG.

     Section 2.04 Applicable Time. For purposes of the Distribution Agreement, the
Applicable Time shall be 10:00 am Central Standard Time on June 13, 2008.

     Section 2.05 Free Writing Prospectus. For purposes of the Distribution Agreement,
each free writing prospectus (attached to this Omnibus Instrument as Exhibit G) constitutes
a part of the Time of Sale Prospectus.

     Section 2.06 Governing Law. This Terms Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regard to the principles of conflicts
of laws thereof.

     Section 2.07 Notices. For purposes of Section 14 of the Distribution Agreement, the
Trust’s communications details are as set forth in Section E of the Omnibus Instrument.

     Section 2.08 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Terms Agreement will enter into this Terms Agreement by executing the
Omnibus Instrument.

     By executing the Omnibus Instrument, each party hereto agrees that this Terms Agreement will
constitute a legal, valid and binding agreement by and among such parties.

     All terms relating to the Trust or the Notes not otherwise included in this Terms Agreement
will be as specified in the Omnibus Instrument, the Pricing Supplement or the Distribution
Agreement as indicated herein.

     Section 2.09 Counterparts. This Terms Agreement, through the Omnibus Instrument, may
be executed in any number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute but one and the same instrument.

[Remainder of Page Left Intentionally Blank.]

D-1

 

SECTION E

COORDINATION AGREEMENT

     This COORDINATION AGREEMENT (this “Coordination Agreement”), dated as of the date of the
Omnibus Instrument, is entered into by and among Principal Life Insurance Company (“Principal
Life”), Principal Financial Group, Inc. (“PFG”), the Principal Life Income Fundings Trust specified
in the Omnibus Instrument (the “Trust”), Bankers Trust Company, N.A. and Citibank, N.A., as
indenture trustee (the “Indenture Trustee”).

WITNESSETH

     WHEREAS, the Trust will enter into the Funding Agreement with Principal Life dated as of the
Original Issue Date specified in the Pricing Supplement;

     WHEREAS, PFG will issue a Guarantee to the Trust as of the Original Issue Date specified in
the Pricing Supplement, which will fully and unconditionally guarantee the payment obligations of
Principal Life under the Funding Agreement;

     WHEREAS, the Purchasing Agent (as defined in the Terms Agreement) has agreed to sell the Notes
in accordance with the Registration Statement;

     WHEREAS, the Trust intends to issue the Notes in accordance with the Indenture, to
collaterally assign to, and grant a security interest in, the Funding Agreement and the Guarantee
to and in favor of the Indenture Trustee in accordance with the Indenture to secure payment of the
Notes; and

     WHEREAS, the Custodian will hold the Funding Agreement and the Guarantee on behalf of the
Indenture Trustee pursuant to the terms of the Custodial Agreement.

     NOW, THEREFORE, to give effect to the agreements and arrangements established under the Terms
Agreement included in the Omnibus Instrument, as applicable, the Trust Agreement, the Indenture and
the Notes, and in consideration of the agreements and obligations set forth herein and for other
good and valuable consideration, the sufficiency of which are hereby acknowledged, each party
hereby agrees as follows:

ARTICLE 1

     Section 1.01 Delivery of the Funding Agreement and the Guarantee. The Trust hereby
authorizes the Custodian, on behalf of the Indenture Trustee, to receive the Funding Agreement from
Principal Life and the Guarantee from PFG pursuant to the assignment of the Funding Agreement and
Guarantee (the “Assignment”), to be entered into on the Original Issue Date, included in the
closing instrument dated as of the Original Issue Date (the “Closing Instrument”).

E-1

 

     Section 1.02 Issuance and Purchase of the Notes.

     (a) Delivery of the Funding Agreement and the Guarantee to the Custodian, on behalf of the
Indenture Trustee, pursuant to the Assignment or execution of the cross receipt contained in the
Closing Instrument shall be confirmation of payment by the Trust for the Funding Agreement.

     (b) The Trust hereby directs the Indenture Trustee, upon receipt by the Custodian, on behalf
of the Indenture Trustee, of the Funding Agreement pursuant to the Assignment and upon receipt by
the Custodian, on behalf of the Indenture Trustee, of the Guarantee, (i) to authenticate the
certificates representing the Notes (the “Notes Certificates”) in accordance with the Indenture and
(ii) to (A) deliver each relevant Notes Certificate to the clearing system or systems identified in
each such Notes Certificate, or to the nominee of such clearing system, or the custodian thereof,
for credit to such accounts as the Purchasing Agent may direct, or (B) deliver each relevant Notes
Certificate to the purchasers thereof as identified by the Purchasing Agent.

ARTICLE 2

     Section 2.01 Directions Regarding Periodic Payments. As registered owner of the
Funding Agreement and the Guarantee as collateral securing payments on the Notes, the Indenture
Trustee will receive payments on the Funding Agreement and the Guarantee on behalf of the Trust.
The Trust hereby directs the Indenture Trustee to use such funds to make payments on behalf of the
Trust pursuant to the Trust Agreement and the Indenture.

     Section 2.02 Maturity of the Funding Agreement. Upon the maturity of the Funding
Agreement and the return of funds thereunder, the Trust hereby directs the Indenture Trustee to set
aside from such funds an amount sufficient for the repayment of the outstanding principal on the
Notes and Trust Beneficial Interest when due.

ARTICLE 3

     Section 3.01 Certificates. Principal Life hereby agrees to deliver an Officer’s
Certificate, a copy of which is attached hereto as Exhibit E, on a quarterly basis to any
rating agency currently rating the Program. The Trust hereby agrees to deliver an Officer’s
Certificate, a copy of which is attached hereto as Exhibit F, on a quarterly basis to any
rating agency currently rating the Program.

     Section 3.02 Filings. Principal Life hereby covenants, as sponsor and depositor, to
file, or cause to be filed, in a timely manner on behalf of the Trust all reports, certifications
or similar filings required under the Securities Exchange Act of 1934, as amended.

ARTICLE 4

     Section 4.01 No Additional Liability. Nothing in this Coordination Agreement shall
impose any liability or obligation on the part of any party to this Coordination Agreement to make
any payment or disbursement in addition to any liability or obligation such party has under the
Program Documents, except to the extent that a party has actually received funds which it is
obligated to disburse pursuant to this Coordination Agreement.

E-2

 

     Section 4.02 No Conflict. This Coordination Agreement is intended to be in
furtherance of the agreements reflected in the documents related to the Program Documents, and not
in conflict. To the extent that a provision of this Coordination Agreement conflicts with the
provisions of one or more Program Documents, the provisions of such Program Documents shall govern.

     Section 4.03 Governing Law. This Coordination Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to the principles of
conflicts of laws thereof.

     Section 4.04 Severability. If any provision in this Coordination Agreement shall be
invalid, illegal or unenforceable, such provision shall be deemed severable from the remaining
provisions of this Coordination Agreement and shall in no way affect the validity or enforceability
of such other provisions of this Coordination Agreement.

     Section 4.05 Notices. All demands, notices and communications under this
Coordination Agreement shall be in writing and shall be deemed to have been duly given upon receipt
at the addresses set forth below:

     To the Trust:

Principal Life Income Fundings Trust (followed by the number set forth in the Omnibus Instrument)

c/o U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, New York 10005

Attention: Corporate Trust Administration

Telephone: (212) 361-2184

Facsimile: (212) 509-3384

     To the Indenture Trustee:

Citibank, N.A.

Citibank Agency & Trust

388 Greenwich Street, 14th Floor

New York, New York 10013

Attention: Jennifer H. McCourt

Telephone: (212) 816-5680

Facsimile: (212) 816-5527

     To Principal Life:

Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392

Attention: General Counsel

Telephone: (515) 247-5111

Facsimile: (515) 248-3011

E-3

 

With a copy to:

Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392

Attention: Jim Fifield

Telephone: (515) 248-9196

Facsimile: (866) 496-6527

     To PFG:

Principal Financial Group, Inc.

711 High Street

Des Moines, Iowa 50392

Attention: General Counsel

Telephone: (515) 247-5111

Facsimile: (515) 248-3011

With a copy to:

Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392

Attention: Jim Fifield

Telephone: (515) 248-9196

Facsimile: (866) 496-6527

     To
Bankers Trust Company, N.A.:

Bankers Trust Company, N.A.

453 7th Street

Des Moines, Iowa 50309-2728

Attention: Diana L. Cook

Telephone: (515) 245-2418

Facsimile: (515) 247-2101

or at such other address as shall be designated by any such party in a written notice to the other
parties.

ARTICLE 5

     Section 5.01 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Coordination Agreement will enter into this Coordination Agreement by
executing the Omnibus Instrument.

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     By executing the Omnibus Instrument, each party hereto agrees that this Coordination Agreement
will constitute a legal, valid and binding agreement by and among the Trust, Principal Life, PFG,
the Custodian and the Indenture Trustee.

     All terms relating to the Trust or the Notes not otherwise included in this Coordination
Agreement will be as specified in the Omnibus Instrument or Pricing Supplement, as indicated
herein.

     Section 5.02 Acknowledgment. Principal Life hereby acknowledges Section 2.10 of the
Indenture and Section 6.1 of the Custodial Agreement. The Trust hereby acknowledges and agrees to
the terms of the Custodial Agreement.

     Section 5.03 Counterparts. This Coordination Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which counterparts shall be
deemed to be an original, and all of which counterparts shall constitute but one and the same
instrument.

     Section 5.04 Capitalized Terms. All capitalized terms used herein and not otherwise
defined in this Coordination Agreement will have the meanings set forth in the Indenture.

[Remainder of Page Left Intentionally Blank.]

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SECTION F

MISCELLANEOUS AND EXECUTION PAGES

     This Omnibus Instrument may be executed by each of the parties hereto in any number of
counterparts, and by each of the parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.

     Each signatory, by its execution hereof, does hereby become a party to each of the agreements
or indenture identified for such party as of the date specified in such agreements or indenture.

     IN WITNESS WHEREOF, the undersigned have executed this Omnibus Instrument with respect to the
Notes as of the date first specified above.

	 	 	 	 	 
	 	PRINCIPAL LIFE INSURANCE COMPANY (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)
	 
	 	 	 
	 	By:  	/s/ Michael Garvin
 	 
	 	 	Name:  	Michael Garvin 	 
	 	 	Title:  	Associate Actuary 	 
	 

	 	 	 	 	 
	 	PRINCIPAL FINANCIAL GROUP, INC. (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)
	 
	 	 	 
	 	By:  	/s/ Elizabeth D. Swanson
 	 
	 	 	Name:  	Elizabeth D. Swanson 	 
	 	 	Title:  	Counsel 	 
	 

	 	 	 	 	 
	 	PRINCIPAL FINANCIAL SERVICES, INC. (in executing below
agrees and becomes a party to the License Agreement set
forth in Section B herein)	 
	 	 	 
	 	By:  	/s/ Elizabeth D. Swanson
 	 
	 	 	Name:  	Elizabeth D. Swanson 	 
	 	 	Title:  	Counsel 	 

Omnibus Instrument Execution Page 1 of 3

 

	 	 	 	 	 
	 	THE PRINCIPAL LIFE INCOME FUNDINGS TRUST DESIGNATED IN
THIS OMNIBUS INSTRUMENT (in executing below agrees and
becomes a party to (i) the License Agreement set forth
in Section B herein, (ii) the Indenture set forth in
Section C herein, (iii) the Terms Agreement set forth
in Section D herein and (iv) the Coordination Agreement
set forth in Section E herein)

	 
	 	By: 	U.S. Bank Trust National Association, not in its
individual capacity but solely in its capacity as
trustee of the Trust	 
	 	 	 
	 	By:  	/s/ Janet O’Hara
 	 
	 	 	Name:  	Janet O’Hara 	 
	 	 	Title:  	Assistant Vice President 	 
	 

	 	 	 	 	 
	 	U.S. BANK TRUST NATIONAL ASSOCIATION (in executing
below agrees and becomes a party to the Trust Agreement
set forth in Section A herein), as Trustee	 
	 	 	 
	 	By:  	/s/ Janet O’Hara
 	 
	 	 	Name:  	Janet O’Hara 	 
	 	 	Title:  	Assistant Vice President 	 
	 

	 	 	 	 	 
	 	GSS HOLDINGS II, INC. (in executing below agrees and
becomes a party to the Trust Agreement set forth in
Section A herein), as Trust Beneficial Owner	 
	 	 	 
	 	By:  	/s/ Bernard J. Angelo
 	 
	 	 	Name:  	Bernard J. Angelo 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	CITIBANK, N.A. (in executing below agrees and becomes a
party to (i) the Indenture set forth in Section C
herein, as Indenture Trustee, Registrar, Transfer
Agent, Paying Agent and Calculation Agent and (ii) the
Coordination Agreement set forth in Section E herein),
as Indenture Trustee, Registrar, Transfer Agent, Paying
Agent and Calculation Agent	 
	 	 	 
	 	By:  	/s/ Jennifer McCourt
 	 
	 	 	Name:  	Jennifer McCourt 	 
	 	 	Title:  	Vice President 	 

Omnibus Instrument Execution Page 2 of 3

 

	 	 	 	 	 
	 	BANKERS TRUST COMPANY, N.A. (in executing below agrees
and becomes a party to the Coordination Agreement set
forth in Section E herein)	 
	 	 	 
	 	By:  	/s/ Diana L. Cook
 	 
	 	 	Name:  	Diana L. Cook 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (in
executing below agrees and becomes a party to the Terms
Agreement set forth in Section D herein)	 
	 	 	 
	 	By:  	/s/ Diane Kenna
 	 
	 	 	Name:  	Diane Kenna 	 
	 	 	Title:  	Authorized Signatory 	 

Omnibus Instrument Execution Page 3 of 3

 

INDEX OF EXHIBITS AND SCHEDULES TO THE OMNIBUS INSTRUMENT

	 	 	 
	Exhibit A

	 	Standard Trust Terms — Incorporated herein by reference to
Exhibit 4.2 to Principal Life Insurance Company’s Current Report
on Form 8-K filed on December 5, 2007.
	 
	 	 
	Exhibit B

	 	Standard License Agreement Terms — Incorporated herein by
reference to Exhibit 99.1 to Principal Life Insurance Company’s
Current Report on Form 8-K, filed on March 29, 2004.
	 
	 	 
	Exhibit C

	 	Standard Indenture Terms — Incorporated herein by reference to
Exhibit 4.1 to Principal Life Insurance Company’s Current Report
on Form 8-K, filed on May 2, 2008.
	 
	 	 
	Exhibit D

	 	Pricing Supplement — Incorporated herein by reference to the
Pricing Supplement with respect to Principal Life Income Fundings
Trust 2008-50, filed on June 9, 2008, with the Securities and
Exchange Commission pursuant to Rule 424(b)(2) under the
Securities Act of 1933, as amended.
	 
	 	 
	Exhibit E

	 	Principal Life Insurance Company Officer’s Certificate
	 
	 	 
	Exhibit F

	 	Principal Life Income Fundings Trusts Trustee Officer’s Certificate
	 
	 	 
	Exhibit G

	 	Free Writing Prospectus(es)
	 
	 	 
	Schedule I

	 	Terms Agreement Specifications

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EXHIBIT E

Principal Life Insurance Company

Officer’s Certificate

     The undersigned, an officer of Principal Life Insurance Company, an Iowa stock life insurance
company (“Principal Life”), does hereby certify to Standard & Poor’s Ratings Services, a division
of The McGraw-Hill Companies, Inc. and Moody’s Investors Service, Inc., in such capacity and on
behalf of Principal Life, to the knowledge of the undersigned and after reasonable inquiry, that:

	 	1.	 	each of the representations and warranties of Principal Life contained in each
Expense and Indemnity Agreement entered into in connection with the Registration
Statement (defined below), and each Funding Agreement issued in connection with the
Program (the “Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and correct on and as of
the date hereof, with the same effect as though such representation or warranty had
been made on and as of the date hereof;
	 
	 	2.	 	no default under any of the Specified Agreements and no event or any condition
which, with notice or lapse of time or both, would become a default, has occurred and
is continuing as of the date hereof;
	 
	 	3.	 	Principal Life has performed and complied with, respectively, in all material
respects, all of the agreements, covenants, obligations and conditions applicable to
Principal Life required by the Specified Agreements to be performed or complied with by
Principal Life on or before the date hereof;
	 
	 	4.	 	the Registration Statement filed on Form S-3 (File Nos. 333-147181 and
333-147181-01) (the “Registration Statement”) by Principal Life and Principal Financial
Group, Inc. has been declared effective by the Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933, as amended (the “Act”) and no stop
order suspending the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been commenced by or are pending before or
contemplated by the Commission;
	 
	 	5.	 	all filings, if any, required by Rule 424 and Rule 430A under the Act have been
made in a timely manner;
	 
	 	6.	 	since ___, the Trusts organized in connection with the program contemplated
by the Registration Statement have issued the following series of Notes:

	 	 	 	[List each series of Notes.] [(collectively, the “Designated Notes”)]; and

	 
	 	7.	 	the Funding Agreements issued in connection with the Designated Notes have been
executed and delivered by Principal Life in accordance with the terms and conditions of
the Program Documents.

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     Capitalized terms used herein and not otherwise defined herein shall have the meanings
set forth in the Standard Indenture Terms dated May 2, 2008.

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the l day of
l, 200l.

	 	 	 	 	 
	 	[Name], [in his/her] capacity as an

authorized officer of Principal Life

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

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EXHIBIT F

Principal Life Income Fundings Trusts

Trustee Officer’s Certificate

     U.S. Bank Trust National Association, not in its individual capacity but solely in its
capacity as trustee acting on behalf of each common law trust organized under the laws of the State
of New York (in such capacity, the “Trustee,” and each such common law trust being referred to
herein as, a “Trust”) in connection with the program contemplated by Registration Statement Nos.
333-147181 and 333-147181-01 filed on Form S-3 (the “Registration Statement”) by Principal Life
Insurance Company and Principal Financial Group, Inc. with the Securities and Exchange Commission,
does hereby certify to Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc. and Moody’s Investors Service, Inc., in such capacity and on behalf of each Trust, to the
knowledge of the Trustee, that:

	 	1.	 	each of the representations and warranties of each Trust contained in the Notes
issued in connection with the Program, each Indenture entered into in connection with
the Registration Statement and the Expense and Indemnity Agreement concerning the
Trusts (the “Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and correct on and as of
the date hereof, with the same effect as though such representation or warranty had
been made on and as of the date hereof;
	 
	 	2.	 	no default under any of the Specified Agreements and no event or any condition
which, with notice or lapse of time or both, would become a default, has occurred and
is continuing as of the date hereof;
	 
	 	3.	 	each Trust has performed and complied with, respectively, in all material
respects, all of the agreements, covenants, obligations and conditions applicable to
such Trust required by the Specified Agreements to be performed or complied with by
such Trust on or before the date hereof;
	 
	 	4.	 	the Notes issued in connection with the Program, have been issued, in all
material respects, in accordance with the terms and conditions of the Program
Documents; and
	 
	 	5.	 	each Funding Agreement has been executed and delivered by the related Trust in
accordance with the terms and conditions of the Program Documents.

     Capitalized terms used herein and not otherwise defined herein shall have the meanings set
forth in the Standard Indenture Terms, dated as of May 2, 2008. In no event shall U.S. Bank
Trust National Association in its personal corporate capacity have any liability for any of the
certifications or statements contained in this Trustee Officer’s Certificate, such liability being
solely that of each Trust.

F-1

 

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the l day of
l, 200l.

	 	 	 	 	 
	 	U.S. Bank Trust National Association, not in its

capacity but solely in its capacity as Trustee acting

on behalf of each Trust

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

F-2

 

EXHIBIT G

Free Writing Prospectus(es)

None.

G-1

 

SCHEDULE I

Terms Agreement Specifications

     In connection with Section 3(a)(iv) of the Distribution Agreement, the Institutional Program
under which the Notes are issued is rated Aa2 by Moody’s Investors Service, Inc. (“Moody’s”) and AA
by Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. (“S&P”).
Principal Life and PFG expect that the Notes will be rated Aa2 by Moody’s. The Company’s financial
strength rating is Aa2 by Moody’s and AA by S&P.

     All capitalized terms used herein and not otherwise defined herein will have the meanings set
forth in the Distribution Agreement.

I-1

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