Document:

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                                                                   Exhibit 10.12

                      FORM OF CHANGE IN CONTROL AGREEMENT

                                August 31, 2001

(Title) (FirstName) (LastName)
(JobTitle)
(Company)
(Address1)
(City), (State) (PostalCode)

Dear (Title) (LastName):

          USX Corporation and its subsidiaries and affiliates (the
"Corporation") recognizes that your contribution to the growth and success of
the Corporation will continue to be substantial and desires to assure the
Corporation of your continued employment. In this connection, the Board of
Directors of the Corporation (the "Board") recognizes that, as is the case with
many publicly-held corporations, the possibility of a change in control may
exist and that such possibility, and the uncertainty and questions which it may
raise among management, may result in the departure or distraction of management
personnel to the detriment of the Corporation and its stockholders.

          Accordingly, the Board has determined that appropriate steps should be
taken to reinforce and encourage the continued attention and dedication of
members of the Corporation's management, including yourself, to their assigned
duties without distraction in the face of potentially disturbing circumstances
arising from the possibility of a change in control of the Corporation.
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          In order to induce you to remain in the employ of the Corporation, the
Corporation agrees that you shall receive the severance benefits set forth in
this letter agreement ("Agreement") in the event your employment with the
Corporation is terminated subsequent to a "Change in Control of the Corporation"
(as defined in Section 2(a) hereof), in connection with a "Potential Change in
Control of the Corporation" (as defined in Section 2(b) hereof), or under the
other circumstances described below.

          Upon the separation of the steel and steel-related businesses of the
Corporation from its energy and energy related businesses (the "Separation"),
which is anticipated to occur on or about January 1, 2002, the steel and steel-
related businesses will be owned and operated by United States Steel
Corporation, which will be a separate, stand-alone, publicly traded company no
longer affiliated with the Corporation, and the energy and energy related
businesses will continue to be owned and operated by the Corporation, which, at
the time of the Separation, will be renamed Marathon Oil Corporation.

          If, in connection with the Separation you will be employed by United
States Steel Corporation, effective at that time:  1) United States Steel
Corporation will assume this Agreement, and will perform under the Agreement in
the same manner and to the same extent that the Corporation would be required to
perform if the Separation had not taken place; 2) United States Steel
Corporation will replace USX Corporation as the "Corporation," as that term is
used in this Agreement, except as otherwise required by context; and 3) USX
Corporation will no longer have any obligations under this
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Agreement. In the event that the Separation does not occur, the obligations owed
to you under this Agreement will remain those of USX Corporation.

          If you will not be employed by United States Steel Corporation in
connection with the Separation, the obligations owed to you under this Agreement
will remain those of the Corporation.  However, in light of the name change,
effective as of the Separation, Marathon Oil Corporation will be the
"Corporation" as that term is used in this Agreement, except as otherwise
required by context.  In the event that the Separation does not occur, this
Agreement will continue unchanged.

          1.   Term of Agreement. This Agreement will commence on the date
               -----------------
hereof and shall continue in effect until December 31, 2002; provided, however,
that commencing on December 31, 2002 and each December 31 thereafter, the term
of this Agreement shall automatically be extended for one additional year
unless, not later than September 1 of that year, the Corporation shall have
given notice that it does not wish to extend this Agreement; provided, further
that, if (a) a Change in Control of the Corporation shall have occurred during
the original or extended term of this Agreement, the term of this Agreement
shall continue in effect for a period of twenty-four (24) months beyond the
month in which such Change in Control of the Corporation occurred and (b) if a
Potential Change in Control of the Corporation shall have occurred during the
original or extended term of this Agreement, then the term of this Agreement
shall continue in effect beginning on the date the Potential Change in Control
occurs and shall not end before the earlier of (i) the end of the month in which
a Change in Control occurs or (ii) the date the Board makes a good faith
determination that the risk of a
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Change in Control has terminated (the "Potential Change in Control Period"). In
the event the Potential Change in Control Period ends due to a Change in
Control, this Agreement shall continue in effect for a period of twenty-four
(24) months beyond the month in which such Change in Control occurred.

     2.   Change in Control and Potential Change in Control of the Corporation.
          --------------------------------------------------------------------

          (a)  For purposes of this Agreement, a "Change in Control of the
Corporation" and "Change in Control" shall mean a change in control of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), whether or not the Corporation is then subject to
such reporting requirement; provided, that, without limitation, such a change in
control shall be deemed to have occurred if:

               (i)  any person (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act) (a "Person") is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Corporation (not including in the amount of the securities
beneficially owned by such person any such securities acquired directly from the
Corporation or its affiliates) representing twenty percent (20%) or more of the
combined voting power of the Corporation's then outstanding voting securities;
provided, however, that for purposes of this Agreement the term "Person" shall
not include (A) the Corporation or any of its subsidiaries, (B) a trustee or
other fiduciary holding securities under an employee benefit plan of the
Corporation or any of its subsidiaries, (C) an underwriter temporarily
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holding securities pursuant to an offering of such securities, or (D) a
corporation owned, directly or indirectly, by the stockholders of the
Corporation in substantially the same proportions as their ownership of stock of
the Corporation; and provided, further, however, that for purposes of this
paragraph (i), there shall be excluded any Person who becomes such a beneficial
owner in connection with an Excluded Transaction (as defined in paragraph (iii)
below); or

               (ii)      the following individuals cease for any reason to
constitute a majority of the number of directors then serving: individuals who,
on the date hereof, constitute the Board and any new director (other than a
director whose initial assumption of office is in connection with an actual or
threatened election contest including, but not limited to, a consent
solicitation, relating to the election of directors of the Corporation) whose
appointment or election by the Board or nomination for election by the
Corporation's stockholders was approved or recommended by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
on the date hereof or whose appointment, election or nomination for election was
previously so approved or recommended; or

               (iii)     there is consummated a merger or consolidation of the
Corporation or any direct or indirect subsidiary thereof with any other
corporation, other than a merger or consolidation (an "Excluded Transaction")
which would result in the voting securities of the Corporation outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
corporation or any parent thereof) at least 50% of the
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combined voting power of the voting securities of the entity surviving the
merger or consolidation (or the parent of such surviving entity) immediately
after such merger or consolidation, or the shareholders of the Corporation
approve a plan of complete liquidation of the Corporation, or there is
consummated the sale or other disposition of all or substantially all of the
Corporation's assets.

          (b)  For purposes of this Agreement, a "Potential Change in Control of
the Corporation" and "Potential Change in Control" shall be deemed to have
occurred, if:

               (i)       the Corporation enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control of
the Corporation;

               (ii)      any Person (including the Corporation) publicly
announces an intention to take or to consider taking actions which if
consummated would constitute a Change in Control of the Corporation;

               (iii)     any Person becomes the beneficial owner, directly or
indirectly, of securities of the Corporation representing 15% or more of the
combined voting power of the Corporation's then outstanding securities (not
including in the amount of the securities beneficially owned by such Person any
such securities acquired directly from the Corporation or its affiliates); or

               (iv)      the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Potential Change in Control of the Corporation has
occurred.
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          (c)  You agree that, subject to the terms and conditions of this
Agreement, in the event of a Change in Control of the Corporation, you will
remain in the employ of the Corporation for a period of three (3) months from
and after the occurrence of such Change in Control of the Corporation; provided,
however, that if during such three-month period (A) your employment is
involuntarily terminated by the Corporation other than for Cause or (B) you
terminate your employment during such three-month period for Good Reason, you
shall not be required to remain in the Corporation's employ. The foregoing shall
in no event limit or otherwise affect your rights under any other provision of
this Agreement.

          (d)  You agree that, subject to the terms and conditions of this
Agreement, in the event of a Potential Change in Control of the Corporation, you
will remain in the employ of the Corporation until the earliest of (A) a date
which is six (6) months from the occurrence of such Potential Change in Control
of the Corporation, (B) the termination of your employment by reason of your
death or Disability, as defined in Subsection 3(a), or (C) a date which is three
(3) months from and after the occurrence of a Change in Control of the
Corporation; provided, however, that if during any such period (A) your
employment is involuntarily terminated by the Corporation other than for Cause
or (B) you terminate your employment during any such period for Good Reason, you
shall not be required to remain in the Corporation's employ. The foregoing shall
in no event limit or otherwise affect your rights under any other provision of
this Agreement.
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          (e)  Notwithstanding anything to the contrary herein, the currently
contemplated tax-free spin-off of the steel and steel-related businesses of the
Corporation into a freestanding, publicly traded company and retention of the
energy and energy-related businesses (the "Restructuring") shall not constitute
a Change in Control nor shall events or actions in contemplation of the
Restructuring constitute a Potential Change in Control.

     3.   Termination Following a Change in Control or Potential Change in
          ----------------------------------------------------------------
Control of the Corporation. If any of the events described in Section 2(a)
--------------------------
hereof constituting a Change in Control of the Corporation shall have occurred,
you shall be entitled to the benefits provided in Section 4(d) hereof upon the
termination of your employment during the term of this Agreement unless such
termination is (i) because of your death or Disability, (ii) by the Corporation
for Cause, (iii) by you other than for Good Reason or (iv) on or after the date
that you attain age sixty-five (65).  If your employment is terminated prior to
a Change in Control, if such termination is other than (i) because of your death
or Disability, (ii) by the Corporation for Cause, (iii) due to your voluntary
resignation, unless such resignation is for Good Reason or (iv) on or after the
date that you attain age sixty-five (65), and either you reasonably demonstrate
that such termination (I) was at the request of or as a result of actions by a
third party who has taken steps reasonably calculated to effect a Change in
Control or (II) occurs during a Potential Change in Control Period, then your
employment shall be deemed to have terminated following a Change in Control.
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          (a)  Disability.  If, as a result of your incapacity due to physical
               ----------
mental illness which in the opinion of a licensed physician renders you
incapable of performing your assigned duties with the Corporation, you shall
have been absent from the full-time performance of your duties with the
Corporation for six (6) consecutive months, and within thirty (30) days after
written Notice of Termination is given you shall not have returned to the full-
time performance of your duties, the Corporation may terminate your employment
for "Disability."

          (b)  Cause. Termination by the Corporation of your employment for
               -----
"Cause" shall mean termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Corporation (other than any such
failure resulting from termination by you for Good Reason or any such failure
resulting from your incapacity due to physical or mental illness), after a
demand for substantial performance is delivered to you that specifically
identifies the manner in which the Corporation believes that you have not
substantially performed your duties, and you have failed to resume substantial
performance of your duties on a continuous basis within fourteen (14) days of
receiving such demand, (ii) the willful engaging by you in conduct which is
demonstrably and materially injurious to the Corporation, monetarily or
otherwise or (iii) your conviction of a felony or conviction of a misdemeanor
which impairs your ability substantially to perform your duties with the
Corporation. For purposes of this Subsection, no act, or failure to act, on your
part shall be deemed "willful" unless done, or omitted to be done, by you not in
good faith and without
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reasonable belief that your action or omission was in the best interest of the
Corporation.

          (c)  Good Reason. You shall be entitled to terminate your employment
               -----------
for Good Reason. For purposes of this Agreement, "Good Reason" shall mean,
without your express written consent, the occurrence after a Change in Control
of the Corporation, or after and at the request of or as a result of actions by
a third party who has taken steps reasonably calculated to effect a Change in
Control or after the first day of but during a Potential Change in Control
Period (each an "Applicable Event"), of any one or more of the following:

               (i)    the assignment to you of duties inconsistent with your
position immediately prior to the Applicable Event or a reduction or alteration
in the nature of your position, duties, status or responsibilities from those in
effect immediately prior to the Applicable Event;

               (ii)   a reduction by the Corporation in your annualized and
monthly or semi-monthly rate of base salary (as increased to incorporate your
foreign service premium, if any) ("Base Salary") as in effect on the date hereof
or as the same shall be increased from time to time;

               (iii)  the Corporation's requiring you to be based at a location
in excess of fifty (50) miles from the location where you are based immediately
prior to the Applicable Event;

               (iv)   the failure by the Corporation to continue, substantially
as in effect immediately prior to the Applicable Event, all of the
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Corporation's employee benefit, incentive compensation, bonus, stock option and
stock award plans, programs, policies, practices or arrangements in which you
participate (or substantially equivalent successor plans, programs, policies,
practices or arrangements) or the failure by the Corporation to continue your
participation therein on substantially the same basis, both in terms of the
amount of benefits provided and the level of your participation relative to
other participants, as existed immediately prior to the Applicable Event;

               (v)    the failure of the Corporation to obtain an agreement from
any successor to the Corporation to assume and agree to perform this Agreement,
as contemplated in Section 7 hereof; and

               (vi)   any purported termination by the Corporation of your
employment that is not effected pursuant to a Notice of Termination satisfying
the requirements of subparagraph (d) below, and for purposes of this Agreement,
no such purported termination shall be effective.

     Your right to terminate your employment pursuant to this Subsection shall
not be affected by your incapacity due to physical or mental illness.  Your
continued employment shall not constitute consent to, or a waiver of rights with
respect to, any circumstance constituting Good Reason hereunder.  Your
determination of the existence of Good Reason shall be final and conclusive
unless such determination is not made in good faith and is made without
reasonable belief in the existence of Good Reason.
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          (d)  Notice of Termination. Any termination by the Corporation for
               ---------------------
Cause or for Disability or by you for Good Reason shall be communicated by
Notice of Termination to the other party hereto. For purposes of this Agreement,
a "Notice of Termination" shall mean a written notice which shall indicate the
specific termination provision in this Agreement relied upon and shall set forth
in reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated.

          (e)  Date of Termination.  "Date of Termination" shall mean the date
               -------------------
specified in the Notice of Termination, when such a notice is required, or in
any other case upon ceasing to perform services to the Corporation; provided,
however, that if within thirty (30) days after any Notice of Termination one
party notifies the other party that a dispute exists concerning the termination,
the Date of Termination shall be the date finally determined to be the Date of
Termination in an arbitration award that has been confirmed or enforced by a
final, nonappealable judgment of a court of competent jurisdiction.  Until there
is a finally determined Date of Termination, your compensation (including your
Base Salary at the rate in effect at the time Notice of Termination is given, or
the Date of Termination where no Notice of Termination is required hereunder)
and benefits as in effect prior to the event asserted to have triggered a Notice
of Termination shall continue in effect.

     4.   Compensation Upon Termination or During Disability.  After an
          --------------------------------------------------
Applicable Event has occurred, if, during the term of this Agreement, your
employment is terminated or you are in a period of Disability the following
shall be applicable:
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          (a)  During any period that you fail to perform your full-time duties
with the Corporation as a result of incapacity due to physical or mental
illness, your total compensation, including your Base Salary, bonus and any
benefits, will continue unaffected until either you return to the full-time
performance of your duties or your employment is terminated pursuant to Section
3(a) hereof.  In the event you return to the full-time performance of your
duties, you shall continue to receive your full Base Salary and bonus plus all
other amounts to which you are entitled under any compensation or other employee
benefit plan of the Corporation without interruption.  In the event your
employment is terminated pursuant to Section 3(a) hereof, your benefits shall be
determined in accordance with the Corporation's retirement, insurance and other
applicable programs and plans then in effect.

          (b)  If your employment shall be terminated by the Corporation for
Cause or by you other than for Good Reason, the Corporation shall pay you your
full Base Salary through the Date of Termination at the rate in effect at the
time Notice of Termination is given or on the Date of Termination if no Notice
of Termination is required hereunder, plus all other amounts to which you are
entitled under any compensation or benefit plan of the Corporation at the time
such payments are due, and the Corporation shall have no further obligations to
you under this Agreement.

          (c)  If your employment terminates by reason of your death, your
benefits shall be determined in accordance with the Corporation's retirement,
survivor's benefits, insurance and other applicable programs and plans then in
effect.
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          (d)  If your employment by the Corporation is either terminated by the
Corporation (other than for Cause or Disability) or terminated by you for Good
Reason, you shall be entitled to the following benefits.

               (i)   Accrued Compensation and Benefits. The Corporation shall
provide you:
               (A)   the compensation and benefits accrued through the Date of
     Termination to the extent not theretofore provided;

               (B)   a lump sum cash amount equal to the value of your unused
     vacation days accrued through the Date of Termination; and

               (C)   your normal post-termination compensation and benefits
     under the Corporation's retirement, insurance and other compensation and
     benefit plans as in effect immediately prior to the Date of Termination, or
     if more favorable to you, immediately prior to the Applicable Event.

               (ii)  Lump Sum Severance Payment. The Corporation shall provide
to you a severance payment in the form of a cash lump sum distribution equal to
your Current Annual Compensation (as defined below) multiplied times three (3);
provided, however, that if you attain age 65 within three years of the Date of
Termination, your benefit will be limited to a pro rata portion of such benefit
based on a fraction equal to the number of full and partial months existing
between the Date of Termination and your sixty-fifth (65/th/) birthday divided
by 36 months.
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          For purposes of this paragraph, the term "Current Annual Compensation"
shall mean the sum of:

                (A)   your Base Salary in effect immediately prior to the
          occurrence of the circumstances giving rise to such termination or, if
          higher, immediately prior to the Applicable Event; and

                (B)   an amount equal to the highest annual bonus awarded to
          you, if any, under any annual bonus plan of the Corporation or its
          predecessor in the three (3) years immediately preceding the Date of
          Termination or, if higher, in the three (3) years immediately
          preceding the Applicable Event.

               (iii)  Continuation of Welfare Benefits.  Subject to the
benefits offset described below, the Corporation will arrange to make available
to you life and health insurance benefits during the Welfare Continuation Period
(as defined below) that are substantially similar to those which you were
receiving under a Corporation-sponsored welfare benefit plan immediately prior
to the Date of Termination or, if more favorable to you, immediately prior to
the Applicable Event.  These benefits will be provided at a cost to you that is
no greater than the amount paid for such benefits by active employees who
participate in such Corporation-sponsored welfare benefit plan or, if less, the
amount paid for such benefits by you immediately prior to the Applicable Event.
The Welfare Continuation Period extends from the Date of Termination for a
period of thirty-six (36) months, or, if earlier, until your 65/th/ birthday.
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          The benefits otherwise receivable by you pursuant to this paragraph
(iii) shall be reduced to the extent comparable benefits are actually received
by you during the Welfare Continuation Period.  For purposes of complying with
the terms of this offset, you are obligated to report to the Corporation the
amount of any such benefits actually received.

               (iv)  Retiree Medical and Life Benefits. The Corporation will
arrange to make available to you retiree life and health insurance benefits
determined as if under the Corporation's welfare benefit plans your actual
participation credit (or continuous service) and actual age as of the Date of
Termination were increased by the additional three years of service and age
provided in paragraph 4(d)(v)(A) below. If eligible for such coverage, you may
elect to commence participation in retiree medical benefits coverage at any time
following the expiration of the Welfare Continuation Period (or immediately
after the Date of Termination, if you satisfy the eligibility requirements
without taking into consideration the additional three years of service and
age).

          Such retiree medical and life insurance coverage, if any, will be
provided by the entity that is your employer as of the Date of Termination. The
term "SSA" is defined to mean Speedway SuperAmerica LLC and its subsidiaries and
successors. The term "MAP" is defined to mean Marathon Ashland Petroleum LLC and
its subsidiaries, other than SSA, and successors. The term "Marathon" is defined
to mean Marathon Oil Corporation, Marathon Oil Company and their subsidiaries,
other than
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MAP and SSA, and successors. The term "Steel" is defined to mean United States
Steel LLC, United States Steel Corporation, and their subsidiaries and
successors.

               (A)  Marathon Welfare Benefit Plan. With respect to a Marathon
          welfare benefit plan, the premium charged by the Corporation for
          retiree medical coverage will be the lowest premium then in effect for
          any retiree medical coverage under its welfare benefit plan or, if
          lower, the lowest premium available thereunder immediately prior to
          the Applicable Event.

               (B)  Steel, MAP or SSA Welfare Benefit Plan. The additional three
          years of continuous service and age provided in paragraph 4(d)(v)(A)
          below shall be taken into consideration in determining your
          eligibility for retiree medical and life insurance benefits under this
          Agreement.

               If because of the recognition of the additional three years of
          continuous service and age described above, your service and/or age
          meets or exceeds the service and/or age specified in the appropriate
          Steel, MAP, or SSA welfare benefit plan for eligibility for retiree
          medical or life insurance coverage, the Corporation will provide you
          with an additional lump sum severance payment equal to the lump sum
          value of the contributions that the Corporation would have made on
          your behalf with respect to the retiree medical and life (as if all
          such life insurance benefits were group term life insurance benefits)
          benefits provided under the
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          appropriate Steel, MAP, or SSA welfare benefit plan. Such additional
          lump sum severance benefit shall be in lieu of monthly Corporation
          contributions on your behalf for retiree medical and life insurance
          coverage under a Steel, MAP, or SSA welfare benefit plan. If you elect
          to participate in retiree medical and life insurance coverage through
          the Corporation, you will be responsible for the full costs of the
          program. The methods and assumptions that existed under the
          appropriate Steel Pension Plans, MAP Pension Plans, or SSA Pension
          Plans immediately prior to the Applicable Event for purposes of
          determining a lump sum distribution shall be used for purposes of
          determining the lump sum value of the Corporation contributions.

                    (v)  Supplemental Retirement Benefit. In addition to the
pension benefits to which you are entitled (assuming Corporation consent, if
necessary for retirement prior to age 60) under the Corporation's defined
benefit pension plans, the Corporation shall provide to you a benefit (the
"Supplemental Retirement Benefit") equal to the difference between: (A) the lump
sum value of your Enhanced Pension Benefit (as defined in paragraph (A) below),
and (B) the lump sum value of your Actual Pension Benefit (as defined in
paragraph (B) below). The Supplemental Retirement Benefit shall be paid in the
form of a lump sum cash distribution. The methods and assumptions that existed
under the applicable Corporation pension plan (or plans) immediately prior to
the Applicable Event for purposes of determining a lump sum distribution shall
be used for purposes of determining the lump sum values in (A) and
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(B). In determining the Enhanced Pension Benefit and the Actual Pension Benefit,
amendments to the Steel Pension Plans, the Marathon Pension Plans, the MAP
Pension Plans, and the SSA Pension Plans made subsequent to the Applicable Event
and on or prior to the Date of Termination, if any, shall be disregarded if they
adversely affect in any manner the computation of retirement benefits
thereunder.
                    (A)  Enhanced Pension Benefit. The amount of your Enhanced
          Pension Benefit shall be equal to the Actual Pension Benefit for which
          you are eligible under the Steel Pension Plans, the Marathon Pension
          Plans, the MAP Pension Plans, and the SSA Pension Plans (as each is
          defined in paragraph 4(d)(v)(B) below) as of the Date of Termination,
          as adjusted to incorporate the enhancements outlined in paragraphs (1)
          through (6) below. If you are employed by Marathon, MAP or SSA as of
          the Date of Termination, the enhancements outlined in this paragraph
          (A) shall be applied only to your benefits under the Marathon Pension
          Plans, the MAP Pension Plans, or the SSA Pension Plans in which you
          were an active participant as of the Date of Termination. Otherwise,
          the enhancements shall be applied only to your benefits under the
          Steel Pension Plans.

               (1)  Normal Retirement Benefit - Service. For purposes of
               determining your monthly normal retirement benefit payable at
               normal retirement age, service used in the formula(s) shall be
               deemed to be equal to the sum of your actual service for benefit
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               accrual purposes plus three years. For this purpose, your actual
               service shall be determined as of the Date of Termination.

               (2) Normal Retirement Benefit - Final Average Pay. For purposes
               of determining your monthly normal retirement benefit payable at
               normal retirement age, final average pay shall be calculated
               using the sum of:

               I.   your Base Salary in effect immediately prior to the
                    occurrence of the circumstances giving rise to such
                    termination or, if higher, immediately prior to the
                    Applicable Event; and

               II.  if bonus is considered covered compensation under the
                    applicable pension plan, an amount equal to the highest
                    annual bonus awarded to you, if any, under any annual bonus
                    plan of the Corporation or its predecessor with respect to
                    the three (3) years immediately preceding the Date of
                    Termination or, if higher, the three (3) years immediately
                    preceding the Applicable Event (but not less than the amount
                    of bonus taken into account in your Actual Pension Benefit).
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               Final average pay taken into account for this paragraph shall not
               be less than the amount of final average pay taken into account
               in the determination of your Actual Pension Benefit.

               (3)  Early Commencement Factors - Enhanced Service and Age. For
               purposes of determining the early commencement factors that apply
               to your monthly normal retirement benefit, your service and age
               shall be deemed equal to your actual service and age plus three
               years of service and three years of age, respectively. For this
               purpose, your actual service and actual age shall be determined
               as of the Date of Termination. In addition, if you satisfy the
               age and service requirements for a Rule-of-65, -70, or -80
               retirement option under the pension rules applicable to the Steel
               Pension Plans as of the Date of Termination (taking into
               consideration the three years of age and service provided in this
               paragraph), you shall be eligible for an immediate pension under
               such retirement option in accordance with the terms of such
               pension rules even though the leave of absence requirements have
               not been satisfied.

               (4)  Full Vesting. Your accrued benefits under the Steel Pension
               Plans, Marathon Pension Plans, the MAP Pension Plans, and the SSA
               Pension Plans shall be deemed to be fully vested or, to the
               extent not so vested, paid as an additional benefit under this
               Agreement.
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               (5) Special SSA Provisions. If you are employed by SSA on the
               Date of Termination:

               I.   the additional service credit under paragraph (1) above
                    shall be disregarded for purposes of calculating the accrued
                    benefit under the prior traditional defined benefit plan
                    formula under SSA's Pension Equity Plan which is otherwise
                    applicable in determining the Enhanced Pension Benefit, but
                    shall be counted for early retirement eligibility and other
                    purposes; and

               II.  in calculating the Enhanced Pension Benefit related to the
                    pension equity formula under SSA's Pension Equity Plan, the
                    additional service credit under paragraph (1) above shall be
                    disregarded and instead you shall be deemed to have Pension
                    Equity Benefit accruals for three additional years following
                    the Date of Termination. The age and participation service
                    points for each deemed year of accrual shall be calculated
                    based on what your actual age and service would have been at
                    the end of each calendar year had you remained employed with
                    SSA.

               (6) Determination of Age - All other purposes. Except as
               specifically provided otherwise in this paragraph (A), your age,
               as
<PAGE>

Page 23

               well as the age of your spouse, survivor, and/or co-pensioner,
               used in the determination of the amount of benefits payable under
               the applicable pension plan shall be determined using your age
               and their actual ages as of the Date of Termination.

                    (B)  Actual Pension Benefit. The amount of your Actual
          Pension Benefit is determined as the sum of the monthly pension
          benefits payable to you as of the Date of Termination under:

               (1) the tax-qualified defined benefit pension plans, non-
               qualified defined benefit excess benefit plans, and non-qualified
               top-hat or supplemental defined benefit plans sponsored or
               maintained by Steel (or any successor plans or similar plans)
               (the "Steel Pension Plans"), and

               (2) the tax-qualified defined benefit pension plans, non-
               qualified defined benefit excess benefit plans, and non-qualified
               top-hat or supplemental defined benefit plans sponsored or
               maintained by Marathon, MAP or SSA (or any successor plans or
               similar plans) (the "Marathon Pension Plans," the "MAP Pension
               Plans," and the "SSA Pension Plans," as applicable).

                    (vi) Supplemental Savings Benefit. In addition to the
benefits you are entitled to under the USX Corporation Savings Fund Plan for
Salaried Employees and/or the Marathon Oil Company Thrift Plan and the related
non-qualified
<PAGE>

Page 24

supplemental savings plans ("Savings Plans"), the Corporation shall provide to
you in the form of a cash lump sum distribution a benefit equal to the excess,
if any, of:

          (A) the amount you would have been entitled to under the Savings Plans
              determined as if you were fully vested thereunder on the Date of
              Termination, over

          (B) the amount you are entitled to under the Savings Plans on the Date
              of Termination.

                    (vii)  Timing. The payments provided for in this paragraph
(d) shall be made not later than the fifth day following the Date of
Termination.

               (e)  The Corporation shall also pay to you all legal fees and
expenses incurred by you, as such legal fees and expenses are incurred, as a
result of termination of employment (including all such fees and expenses, if
any, incurred in contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this Agreement or in
connection with any tax audit or proceeding to the extent attributable to the
application of section 4999 of the Code to any payment or benefit provided
hereunder) or otherwise.

               (f)  Other than as provided in Section 4(d)(iii), you shall not
be required to mitigate the amount of any payment provided for in this Section 4
by seeking other employment or otherwise, nor shall the amount of any payment
provided for in this Section 4 be reduced by any compensation earned by you as
the result of employment by another employer, including self-employment, after
the Date of Termination, or otherwise.
<PAGE>

Page 25

          5.   Stock Awards Acceleration.
               -------------------------

                    (a)  Upon a Change in Control, all outstanding options,
restored options, and stock appreciation rights granted to you under any option
or incentive plan of the Corporation shall be immediately fully vested and
immediately exercisable and shall remain so exercisable throughout their entire
original terms, and all restricted stock shall be immediately vested.

                    (b)  If your employment is terminated prior to a Change in
Control and you are entitled to benefits under Section 4(d), as of the Date of
Termination all outstanding options, restored options, and stock appreciation
rights granted to you shall be immediately fully vested and immediately
exercisable and shall remain so exercisable throughout their entire original
terms, and all restricted stock shall be immediately vested.

                    (c)  The terms of this Section 5 shall amend and supercede
the terms of any other agreement or instrument relating to the treatment of such
outstanding options, restored options, stock appreciation rights, and restricted
stock upon or following an Applicable Event.

          6.   Additional Payment.
               ------------------

                    (a)  Whether or not you become entitled to any benefits
under Section 4 above, in the event that there is made any payment in the nature
of compensation to or for your benefit that would be subject to the tax (the
"Excise Tax") imposed by section 4999 of the Internal Revenue Code of 1986, as
amended (the "Code"), the Corporation shall pay to you, at the time specified in
paragraph (b) below,
<PAGE>

Page 26

an additional amount (the "Gross-Up Payment") such that the net amount retained
by you shall be equal to the compensation and benefits you would have received
had there been no Excise Tax imposed. For purposes of determining whether any of
the payments will be subject to the Excise Tax and the amount of such Excise
Tax, (i) any payments or benefits received or to be received by you in
connection with a Change in Control of the Corporation or your termination of
employment, whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Corporation or with any person whose actions
result in a Change in Control of the Corporation or with any person affiliated
with the Corporation or such person (the "Total Payments") shall be treated as
"parachute payments" within the meaning of section 280G(b)(2) of the Code, and
all "excess parachute payments" within the meaning of section 280G(b)(1) shall
be treated as subject to the Excise Tax, except to the extent that in the
opinion of tax counsel reasonably acceptable to you and selected by the
accounting firm which, immediately prior to the Change in Control, served as the
Corporation's independent auditor (the "Auditor") such other payments or
benefits (in whole or in part) do not constitute parachute payments, or such
excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning of section
280G(b)(4) of the Code in excess of the base amount within the meaning of
section 280G(b)(3) of the Code, or are otherwise not subject to the Excise Tax,
(ii) the amount of the Total Payments which shall be treated as subject to the
Excise Tax shall be equal to the lesser of (A) the total amount of the Total
Payments or (B) the amount of excess parachute payments within the meaning of
<PAGE>

Page 27

section 280G(b)(1) (after applying clause (i), above), and (iii) the value of
the Total Payments, including the value of any non-cash benefits or any deferred
payment or benefit, shall be determined by the Auditor in accordance with the
principles of section 280G of the Code. For purposes of determining the amount
of the Gross-Up Payment, you shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation in the calendar year in which
the Gross-Up Payment is to be made and state and local income taxes at the
highest marginal rate of taxation in the state and locality of your residence on
the Date of Termination (or, if there is no Date of Termination, then on the
date of the Change in Control), net of the maximum reduction in federal income
taxes which could be obtained from deduction of such state and local taxes. In
the event that the Excise Tax is subsequently determined to be less than the
amount taken into account hereunder in calculating the Gross-Up Payment, you
shall repay to the Corporation, at the time that the amount of such reduction in
Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction (plus the portion of the Gross-Up Payment
attributable to the Excise Tax, and federal and state and local income tax, and
FICA-Health Insurance tax imposed on the portion of the Gross-Up Payment being
repaid by you if such repayment results in a reduction in Excise Tax or FICA-
Health Insurance tax, and/or a federal and state and local income tax deduction)
plus interest on the amount of such repayment at the rate provided in section
1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to
exceed the amount taken into account hereunder (including by reason of any
payment the existence or amount of which cannot be determined at the time of the
Gross-Up
<PAGE>

Page 28

Payment), the Corporation shall make an additional gross-up payment in respect
of such excess (plus any penalty, interest or Excise Taxes payable with respect
to such excess) at the time that the amount of such excess is finally
determined, such that you retain the same amount of compensation and benefits
you would have received had there been no Excise Tax imposed.

               (b)  The payments provided for in paragraph (a) above shall be
made not later than the fifth day following the Date of Termination (or, if
there is no Date of Termination, not later than the fifth day following the date
of the Change in Control); provided, however, that if the amounts of such
payments cannot be finally determined on or before such day, the Corporation
shall pay to you on such day an estimate as determined in good faith by the
Corporation of the minimum amount of such payments and shall pay the remainder
of such payments (together with interest at the rate provided in section
1274(b)(2)(B) of the Code) as soon as the amount thereof can be determined but
in no event later than the thirtieth day after the Date of Termination (or, if
there is no Date of Termination, not later than the thirtieth day after the date
of the Change in Control). In the event that the amount of the estimated
payments exceeds the amount subsequently determined to have been due, such
excess shall constitute a loan by the Corporation to you payable on the fifth
day after demand by the Corporation (together with interest at the rate provided
in section 1274(b)(2)(B) of the Code).

          7.   Successors; Binding Agreement.
               -----------------------------

               (a)  The Corporation will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of
<PAGE>

Page 29

the business and/or assets of the Corporation or of any division or subsidiary
thereof employing you to expressly assume and agree to perform this Agreement in
the same manner and to the same extent that the Corporation would be required to
perform it if no such succession had taken place. Failure of the Corporation to
obtain such assumption and agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle you to
compensation from the Corporation in the same amount and on the same terms as
you would be entitled hereunder if you terminate your employment for Good Reason
following an Applicable Event, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be
deemed the Date of Termination.

               (b)  This Agreement shall inure to the benefit of and be
enforceable by your personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If you
should die while any amount would still be payable to you hereunder if you had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to your devisee, legatee or
other designee or, if there is no such designee, to your estate.

          8.   Notice.  For the purpose of this Agreement, notices and all other
               ------
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth on the first page of this Agreement.
<PAGE>

Page 30

          9.   Miscellaneous.  No provision of this Agreement may be modified,
               -------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by you and such officer as may be specifically designated
by the Board. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Delaware.

          10.  Validity.  The invalidity or unenforceability of any provision of
               --------
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

          11.  Counterparts.  This Agreement may be executed in several
               ------------
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

          12.  Claims and Arbitration.
               ----------------------

                  (a)    Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any court having
jurisdiction; provided, however, that you shall be entitled to seek specific
performance of your right to be paid until the Date of Termination during the
pendency of any dispute or controversy arising under or in connection with this
Agreement.

                  (b)    If you will be employed by United States Steel
Corporation in connection with the Separation previously referenced in this
Agreement, or in the event that the Separation does not occur, any such
arbitration shall be held in Pittsburgh,
<PAGE>

Page 31

Pennsylvania. If you will not be employed by United States Steel Corporation in
connection with the Separation, following the Separation any such arbitration
will be held in Houston, Texas.

          13.  Entire Agreement.  This Agreement supersedes any other agreement
               ----------------
or understanding between the parties hereto with respect to the issues that are
the subject matter of this Agreement.

          14.  Effective Date.  This Agreement shall become effective as of the
               --------------
date set forth above. If this letter sets forth our agreement on the subject
matter hereof, kindly sign and return to the Corporation the enclosed copy of
this letter which will then constitute our agreement on this subject.

                                    Sincerely,

                                    USX CORPORATION

                                    By  __________________________
                                        Dan D. Sandman
                                        General Counsel, Secretary &
                                        Senior Vice President-
                                        Human Resources &
                                        Public Affairs

Agreed to this ____ day of

______________, 2001

By __________________________<PAGE>   1
                                                                     EXHIBIT 4.1

================================================================================

                        BINDVIEW DEVELOPMENT CORPORATION

                                       AND

                          MELLON INVESTOR SERVICES LLC

                                  RIGHTS AGENT

                                RIGHTS AGREEMENT

                         Dated as of September 17, 2001

================================================================================

<PAGE>   2
                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                               PAGE
<S>                                                                                                            <C>
Section 1.        Certain Definitions............................................................................1

Section 2.        Appointment of Rights Agent....................................................................4

Section 3.        Issue of Right Certificates....................................................................4

Section 4.        Form of Right Certificates.....................................................................5

Section 5.        Countersignature and Registration..............................................................6

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

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

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

Section 9.        Availability of Preferred Shares; Transfer Taxes; Exchange Listing; Securities
                  Registration...................................................................................8

Section 10.       Preferred Shares Record Date...................................................................9

Section 11.       Adjustment of Purchase Price, Number of Shares or Number of Rights.............................9

Section 12.       Certificate of Adjusted Purchase Price or Number of Shares....................................15

Section 13.       Consolidation, Merger or Sale or Transfer of Assets or Earning Power..........................15

Section 14.       Fractional Rights and Fractional Shares.......................................................17

Section 15.       Rights of Action..............................................................................18

Section 16.       Agreement of Right Holders....................................................................18

Section 17.       Right Certificate Holder Not Deemed a Stockholder.............................................19

Section 18.       Concerning the Rights Agent...................................................................19

Section 19.       Merger or Consolidation or Change of Name of Rights Agent.....................................20

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

Section 21.       Change of Rights Agent........................................................................22

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

Section 23.       Redemption....................................................................................22

Section 24.       Exchange......................................................................................23

Section 25.       Notice of Certain Events......................................................................25

Section 26.       Notices.......................................................................................25

Section 27.       Supplements and Amendments....................................................................26

Section 28.       Successors....................................................................................26

Section 29.       Benefits of this Agreement....................................................................26
</TABLE>

                                      -i-
<PAGE>   3
<TABLE>
<CAPTION>
                                                                                                               PAGE
<S>                                                                                                            <C>
Section 30.       Severability..................................................................................26

Section 31.       Determinations and Actions by the Board of Directors..........................................27

Section 32.       Governing Law.................................................................................27

Section 33.       Counterparts..................................................................................27

Section 34.       Descriptive Headings..........................................................................27

Exhibit A         Statement of Resolution Establishing Series of Shares........................................A-1

Exhibit B         Form of Right Certificate....................................................................B-1

Exhibit C         Summary of Rights to Purchase Preferred Shares...............................................C-1
</TABLE>

                                      -ii-
<PAGE>   4
                                RIGHTS AGREEMENT

         Rights Agreement (this "Agreement") dated as of September 17, 2001,
between BindView Development Corporation, a Texas corporation (the "Company"),
and Mellon Investor Services LLC, a New Jersey limited liability company (the
"Rights Agent").

         The Board of Directors of the Company (the "Board of Directors") has
authorized and declared a dividend, and thereby directed the issuance, of one
Preferred Share (as such term is hereinafter defined) purchase right (a "Right")
for and in respect of each Common Share (as such term is hereinafter defined)
outstanding on September 21, 2001 (the "Record Date"), each Right representing
the right to purchase one one-hundredth interest in a Preferred Share, upon the
terms and subject to the conditions herein set forth, and has further authorized
and directed the issuance of one Right with respect to each Common Share that
shall become outstanding between the Record Date and the earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date (as such
terms are hereinafter defined).

         Accordingly, 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 (in addition to those defined above) have the meanings
indicated:

                  (a) "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates and Associates
(as such terms are hereinafter defined) of such Person, shall be the Beneficial
Owner (as such term is hereinafter defined) of [15%] or more of the Common
Shares then outstanding, but shall not include (i) the Company, (i) any
Subsidiary (as such term is hereinafter defined) of the Company, (i) any
employee benefit plan of the Company or of any Subsidiary of the Company or (i)
any Person holding Common Shares for or pursuant to the terms of any such plan
to the extent, and only to the extent, of the Common Shares so held.
Notwithstanding the foregoing, no Person shall become an "Acquiring Person" as
the result of an acquisition of Common Shares by the Company which, by reducing
the number of shares outstanding, increases the proportionate number of shares
beneficially owned by such Person to 15% or more of the Common Shares then
outstanding; provided, however, that if a Person becomes the Beneficial Owner of
15% or more of the Common Shares then outstanding by reason of share
acquisitions by the Company and shall, after such share acquisitions by the
Company, become the Beneficial Owner of any additional Common Shares, then such
Person shall be deemed to be an "Acquiring Person". Notwithstanding the
foregoing, if the Board of Directors of the Company determines in good faith
that a Person who would otherwise be an "Acquiring Person", as defined pursuant
to the foregoing provisions of this Section 1(a), has become such inadvertently,
and such Person divests as promptly as practicable a sufficient number of Common
Shares so that such Person would no longer be an "Acquiring Person", as defined
pursuant to the foregoing provisions of this Section 1(a), then such Person
shall not be deemed to be an "Acquiring Person" for any purposes of this
Agreement.

                  (b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as in effect on the date of this Agreement.
<PAGE>   5

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

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

                      (ii) which such Person or any of such Person's Affiliates
         or Associates has the right to acquire (whether such right is
         exercisable immediately or only after the passage of time) pursuant to
         any written or oral agreement, arrangement or understanding (other than
         customary agreements with and between underwriters and selling group
         members with respect to a bona fide public offering of securities), or
         pursuant to the exercise of conversion rights, exchange rights, rights
         (other than the Rights), warrants or options, or otherwise; provided,
         however, that a Person shall not be deemed the Beneficial Owner of, or
         to beneficially own, securities tendered pursuant to a tender or
         exchange offer made by or on behalf of such Person or any of such
         Person's Affiliates or Associates until such tendered securities are
         accepted for purchase or exchange;

                      (iii) which such Person or any of such Person's Affiliates
         or Associates has the right to vote or consent to action pursuant to
         any written or oral agreement, arrangement or understanding; provided,
         however, that a Person shall not be deemed the Beneficial Owner of, or
         to beneficially own, any security if the agreement, arrangement or
         understanding to vote or consent to action such security (A) arises
         solely from a revocable proxy or consent given to such Person in
         response to a public proxy or consent solicitation made pursuant to,
         and in accordance with, the applicable rules and regulations
         promulgated under the Exchange Act and (B) is not also then reportable
         on Schedule 13D promulgated under the Exchange Act (or any comparable
         or successor report); or

                      (iv) which are beneficially owned, directly or indirectly,
         by any other Person with which such Person or any of such Person's
         Affiliates or Associates has any agreement, arrangement or
         understanding (other than customary agreements with and between
         underwriters and selling group members with respect to a bona fide
         public offering of securities) for the purpose of acquiring, holding,
         voting or consenting to action (except to the extent contemplated by
         the proviso to Section 1(c)(iii)) or disposing of any securities of the
         Company.

Notwithstanding the foregoing, any securities that are owned or held by the
Company, by any Subsidiary of the Company, or by any employee benefit plan of
the Company or of any Subsidiary of the Company, and any securities that are
owned or held by any Person pursuant to the terms of any such plan (to the
extent, and only to the extent, of the securities so held), shall not be deemed
to be beneficially owned by any other Person and no other Person shall be deemed
to be the Beneficial Owner of such securities.

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

                                       -2-
<PAGE>   6

                  (e) "Close of Business" on any given date shall mean 5:00
p.m., Houston time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 p.m., Houston time, on the next succeeding
Business Day.

                  (f) "Common Shares" when used with reference to the Company
(specifically or in context) shall mean the shares of common stock, no par value
per share, of the Company. "Common Shares" when used with reference to any
Person other than the Company shall mean the capital stock (or equity interest)
with the greatest voting power of such other Person or, if such other Person is
a Subsidiary of another Person, of the Person or Persons which ultimately
control such first-mentioned Person.

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

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

                  (i) "Person" shall mean any individual, firm, corporation,
incorporated or unincorporated association, trust, limited liability company,
partnership, joint venture, unincorporated organization, group or other entity,
and shall include any successor (by merger or otherwise) of any such Person.

                  (j) "Preferred Shares" shall mean shares of Series A Preferred
Stock, par value $.01 per share, of the Company having the rights and
preferences set forth in the form of the Statement of Resolution Establishing
Series of Shares attached to this Agreement as Exhibit A.

                  (k) "Purchase Price" shall have the meaning set forth in
Section 4 hereof, as the same may be adjusted from time to time in accordance
with the terms of this Agreement.

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

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

                  (n) "Subsidiary" of any Person shall mean any corporation,
incorporated or unincorporated association, limited liability company,
partnership or other entity of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly or indirectly, by
such Person.

         Any additional term used wholly within a subsequent Section of this
Agreement and defined therein shall have the meaning given it in such Section of
this Agreement for purposes of such Section.

         Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time

                                       -3-
<PAGE>   7

appoint such co-Rights Agents as it may deem necessary or desirable. The Rights
Agent shall have no duty to supervise, and in no event shall be liable for, the
acts or omissions of any such co-Rights Agent.

         Section 3. Issue of Right Certificates.

                  (a) Until the earlier (the earlier of such dates being herein
referred to as the "Distribution Date") of (i) the Close of Business on the
tenth Business Day after the Shares Acquisition Date or (ii) the Close of
Business on the tenth Business Day after the date of the commencement by any
Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company, or any entity
holding Common Shares for or pursuant to the terms of any such plan to the
extent such entity is so acting with the approval or consent of the Company) of,
or of the first public announcement of the intention of any Person (other than
the Company, any Subsidiary of the Company, any employee benefit plan of the
Company or of any Subsidiary of the Company, or any entity holding Common Shares
for or pursuant to the terms of any such plan to the extent such entity is so
acting with the approval or consent of the Company) to commence, a tender or
exchange offer the consummation of which would result in any Person becoming the
Beneficial Owner of 15% or more of the Common Shares then outstanding, including
any such date that is after the date of this Agreement and prior to the issuance
of the Rights, (x) the Rights will be evidenced (subject to the provisions of
Section 3(b) hereof) by the certificates for Common Shares registered in the
names of the holders thereof (which certificates shall also be deemed to be
Right Certificates) and not by separate Right Certificates, and (y) the right to
receive Right Certificates will be transferable only in connection with the
transfer of Common Shares. As soon as practicable after the Distribution Date,
the Company shall promptly notify in writing the Rights Agent of the occurrence
thereof and, if the Rights Agent is not then also the transfer agent and
registrar for the Common Stock, provide the Rights Agent with the names and
addresses of all record holders of Common Stock (together with all other
necessary information), and, if such notification is given orally, the Company
shall confirm the same in writing on or prior to the Business Day next following
(until such notice is received by the Rights Agent, the Rights Agent may presume
conclusively for all purposes that the Distribution Date has not occurred), the
Company will prepare and execute, the Rights Agent will countersign, and the
Company will send or cause to be sent (and the Rights Agent will, if requested,
send), by first-class, insured, postage prepaid mail, to each record holder of
Common Shares as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the Company, a Right Certificate,
in substantially the form of Exhibit B hereto (a "Right Certificate"),
evidencing one Right for each Common Share so held. As of the Distribution Date,
the Rights will be evidenced solely by such Right Certificates.

                  (b) As promptly as practicable following the Record Date, the
Company will send a copy of a Summary of Rights to Purchase Preferred Shares, in
substantially the form of Exhibit C hereto (the "Summary of Rights"), by
first-class, postage prepaid mail, to each record holder of Common Shares as of
the Close of Business on the Record Date, at the address of such holder shown on
the records of the Company. With respect to certificates for Common Shares
outstanding as of the Record Date, until the Distribution Date, the Rights
associated with the Common Shares represented by such certificates shall be
evidenced by such certificates together with a copy of the Summary of Rights
attached thereto. Until the Distribution Date (or the

                                       -4-
<PAGE>   8

earlier of the Redemption Date or the Final Expiration Date), the surrender for
transfer of any certificate for Common Shares outstanding on the Record Date,
with or without a copy of the Summary of Rights attached thereto, shall also
constitute the transfer of the Rights associated with the Common Shares
represented thereby.

                  (c) Certificates for Common Shares that become outstanding
(including, without limitation, reacquired Common Shares referred to in the last
sentence of this paragraph (c)) after the Record Date but prior to the earliest
of the Distribution Date, the Redemption Date or the Final Expiration Date shall
have impressed on, printed on, written on or otherwise affixed to them the
following legend or such similar legend as the Company may deem appropriate and
as is not inconsistent with the provisions of this Agreement:

                  This certificate also evidences and entitles the holder hereof
                  to certain rights as set forth in a Rights Agreement between
                  BindView Development Corporation and Mellon Investor Services
                  LLC, dated as of September 17, 2001 (the "Rights Agreement"),
                  the terms of which are hereby incorporated herein by reference
                  and a copy of which is on file at the principal executive
                  offices of BindView Development Corporation. Under certain
                  circumstances, as set forth in the Rights Agreement, the
                  Rights described therein will be evidenced by separate
                  certificates and will no longer be evidenced by this
                  certificate. BindView Development Corporation will mail to the
                  holder of this certificate a copy of the Rights Agreement
                  without charge after receipt of a written request therefor. As
                  described in the Rights Agreement, Rights issued to any Person
                  who becomes an Acquiring Person (as those terms are defined in
                  the Rights Agreement) shall become null and void.

With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Shares represented by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares represented thereby. In
the event that the Company purchases or acquires any Common Shares after the
Record Date but prior to the Distribution Date, any Rights associated with such
Common Shares shall be deemed canceled and retired so that the Company shall not
be entitled to exercise any Rights associated with the Common Shares which are
no longer outstanding.

         Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase Preferred Shares and of assignment to be printed
on the reverse thereof) shall be in substantially the form of Exhibit B hereto
and may have such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Company may deem appropriate,
provided that such marks, legends, summaries and endorsements do not affect the
rights, duties or responsibilities of the Rights Agent and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. Subject to the

                                       -5-
<PAGE>   9

provisions of this Agreement, including the provisions hereof relating to the
adjustment of the number of one one-hundredth interests in a Preferred Share and
the Purchase Price under specified circumstances, the Right Certificates shall
entitle the holders thereof to purchase such number of one one-hundredth
interests in a Preferred Share as shall be set forth therein at the price per
one one-hundredth interest in a Preferred Share set forth therein (the "Purchase
Price").

         Section 5. Countersignature and Registration. The Right Certificates
shall be executed on behalf of the Company by its Chairman of the Board of
Directors, its President or any Vice President, either manually or by facsimile
signature, shall have affixed thereto the Company's seal or a facsimile thereof,
and shall be attested by the Secretary or an Assistant Secretary of the Company,
either manually or by facsimile signature. The Right Certificates shall be
manually countersigned by the Rights Agent and shall not be valid for any
purpose unless countersigned. In case any officer of the Company who shall have
signed any of the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery by
the Company, such Right 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 Right Certificates had not ceased to
be such officer of the Company; and any Right Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Right Certificate, shall be a proper officer of the Company to sign such
Right Certificate, although at the date of the execution of this Agreement any
such person was not such an officer.

         Following the Distribution Date and receipt by the Rights Agent of
written notice to that effect and all other relevant information referred to in
Section 3(a), the Rights Agent will keep or cause to be kept, at its office
designated for such purpose, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and addresses of
the respective holders of the Right Certificates, the number of rights evidenced
on its face by each of the Right Certificates and the date of each of the Right
Certificates.

         Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. Subject
to the provisions of Section 14 hereof, at any time after the Close of Business
on the Distribution Date, and at or prior to the Close of Business on the
earlier of the Redemption Date or the Final Expiration Date, any Right
Certificate or Right Certificates (other than Right Certificates representing
Rights that have become null and void pursuant to Section 11(a)(ii) hereof or
that have been exchanged pursuant to Section 24 hereof) may be transferred,
split up, combined or exchanged for another Right Certificate or Right
Certificates, entitling the registered holder to purchase a like number of one
one-hundredth interests in a Preferred Share as the Right Certificate or Right
Certificates surrendered then entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any Right Certificate
or Right Certificates shall make such request in writing delivered to the Rights
Agent and shall endorse and surrender the Right Certificate or Right
Certificates to be transferred, split up, combined or exchanged at the office of
the Rights Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate unless and until the
registered holder shall have (i) properly completed, executed and delivered a
certificate contained in the form of assignment set forth on the reverse side of
such Right Certificate and (i) provided such additional evidence of the identity
of the

                                       -6-
<PAGE>   10

Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company or the Rights Agent shall have requested. Thereupon the
Rights Agent shall countersign and deliver to the Person entitled thereto a
Right Certificate or Right Certificates, as the case may be, as so requested.
The Company may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split
up, combination or exchange of Right Certificates. The Rights Agent shall have
no duty or obligation under this Section 6 or any other similar provision of
this Agreement unless and until it is satisfied that all such taxes and/or
governmental charges have been paid in full.

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

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

                  (a) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time, subject to the last sentence of Section 23(a)
hereof, after the Distribution Date upon surrender of the Right Certificate,
with the form of election to purchase on the reverse side thereof duly completed
and executed, to the Rights Agent at the principal office of the Rights Agent,
together with payment of the Purchase Price for each one one-hundredth interest
in a Preferred Share as to which the Rights are exercised, at or prior to the
earliest of (i) the Close of Business on September 17, 2011 (the "Final
Expiration Date"), (i) the time at which the Rights are redeemed as provided in
Section 23 hereof (the "Redemption Date"), or (i) the time at which such Rights
are exchanged as provided in Section 24 hereof.

                  (b) The Purchase Price for each one one-hundredth interest in
a Preferred Share pursuant to the exercise of a Right shall initially be $11.00,
shall be subject to adjustment from time to time as provided in Sections 11 and
13 hereof, and shall be payable in lawful money of the United States of America
in accordance with paragraph (c) below.

                  (c) Subject to the Company's rights under Section 11(a)(iii)
hereof, upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase duly executed, accompanied by payment of
the Purchase Price for the shares to be purchased (plus an amount equal to any
applicable tax or charge required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof) by certified check, cashier's
check or money order payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) (A) requisition from any transfer agent of the Preferred
Shares certificates for the number of Preferred Shares to be purchased, and the
Company hereby irrevocably authorizes and directs its transfer agent to comply
with all such requests, or (B) requisition from the depositary agent (if one
exists as hereinafter contemplated) depositary receipts representing such number
of one one-hundredth interests in a Preferred Share as are to be purchased (in
which

                                       -7-
<PAGE>   11

case certificates for the Preferred Shares represented by such receipts shall be
deposited by the transfer agent of the Preferred Shares with the depositary
agent), and the Company hereby directs the depositary agent to comply with all
such requests, (i) when necessary to comply with this Agreement, requisition
from the Company the amount of cash to be paid in lieu of issuance of fractional
shares in accordance with Section 14 hereof, and, if applicable, requisition
from the Company, and/or any transfer agent for securities thereof (any such
transfer agent being hereby authorized to comply with all such requests), the
number of Common Shares to be issued in lieu of the issuance of Preferred Shares
in accordance with Section 11(a)(ii) or the amount of cash, property or other
securities to be paid or issued in lieu of the issuance of Common Shares in
accordance with Section 11(a)(iii), (i) 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 Right Certificate, registered in such name or names as
may be designated by such holder, and (i) when necessary to comply with this
Agreement in accordance with Section 11(a)(iii) hereof, after receipt, deliver
such cash, property or other securities to or upon the order of the registered
holder of such Right Certificate.

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

                  (e) Subject to the Company's rights under Section 11(a)(iii)
hereof to otherwise fulfill its obligations, the Company covenants and agrees
that it will cause to be kept available out of its authorized and unissued
Preferred Shares, the number of Preferred Shares that will be sufficient to
permit the exercise in full of all outstanding Rights in accordance with this
Section 7.

                  (f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action whatsoever with respect to a purported exercise of any
Right as contemplated by this Section 7 unless and until such registered holder
shall have (i) properly completed, executed and delivered a certificate
contained in the form of election to purchase set forth on the reverse side of
the Right Certificate surrendered in connection with such exercise and (i)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall have requested.

                  (g) Neither the Company nor the Rights Agent shall have any
liability to any holder of Rights or any other Person as a result of the
Company's failure to make any determination under this Section 7 or any other
section with respect to an Acquiring Person or an Affiliate or Associate of an
Acquiring Person or transferees hereunder.

         Section 8. Cancellation and Destruction of Right Certificates. All
Right Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of

                                       -8-
<PAGE>   12

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 Right Certificate representing Rights purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall, at the written request
of the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.

         Section 9. Availability of Preferred Shares; Transfer Taxes; Exchange
Listing; Securities Registration. The Company covenants and agrees that it will
take all such action as may be necessary to ensure that all Preferred Shares
delivered upon exercise of Rights shall, at the time of delivery of the
certificates for such Preferred Shares (subject to payment of the Purchase
Price), be duly authorized and validly issued and fully paid and nonassessable
shares.

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

         The Company shall (i) prepare and file, upon, or as soon as possible
following, the Distribution Date, a registration statement under the Securities
Act of 1933, as amended (the "Act") with respect to the securities purchasable
upon exercise of the Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as possible after such filing, and (iii)
cause such registration statement to remain effective (with a prospectus at all
times meeting the requirements of the Act) until no longer required to do so
under the Act with respect to securities purchasable upon exercise of the
Rights. The Company will also take all such action as may be required or as is
appropriate under the securities or blue sky laws of such jurisdictions as may
be necessary or appropriate with respect to the securities purchasable upon the
exercise of the Rights.

         Section 10. Preferred Shares Record Date. Each Person in whose name any
certificate for Preferred Shares is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the Preferred
Shares represented thereby on, and such certificate shall be dated, the date
upon which the Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable taxes and/or charges) was
made; provided, however, that if the date of such surrender and payment is a
date upon which the Preferred Shares transfer books of the Company are closed,
such Person shall be deemed to have become the record holder of such shares on,
and such certificate shall be dated,

                                       -9-
<PAGE>   13

the next succeeding Business Day on which the Preferred Shares transfer books of
the Company are open.

         Section 11. Adjustment of Purchase Price, Number of Shares or Number of
Rights. The Purchase Price, the number of Preferred Shares or interests therein
that the holder of a Right Certificate is entitled to purchase on the exercise
of the Rights evidenced thereby and the number of Rights outstanding are subject
to adjustment from time to time as provided in this Section 11.

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

                  (i) Subject to Sections 23 and 24 of this Agreement, in the
         event any Person shall become an Acquiring Person, proper provision
         shall be made so that each holder of a Right shall thereafter have a
         right to receive, upon exercise thereof in accordance with Section 7
         hereof at a price equal to the then current Purchase Price multiplied
         by the number of one one-hundredth interests in a Preferred Share for
         which a Right is then exercisable, in accordance with the terms of this
         Agreement and in lieu of interests in Preferred Shares, such number of
         Common Shares as shall equal the result obtained by (A) multiplying the
         then current Purchase Price by the number of one one-hundredth
         interests in a Preferred Share for which a Right is then exercisable
         and dividing that product by (B) 50% of the then current per share
         market price of the Company's Common Shares (determined pursuant to
         Section 11(d) hereof) on the date such Person became an Acquiring
         Person.

                  Notwithstanding the foregoing or anything in this Agreement to
         the contrary, from and after the time any Person becomes an Acquiring
         Person, any Rights that are or were acquired or beneficially owned by
         such Acquiring Person (or any Associate or Affiliate of such Acquiring
         Person) shall be null and void without any further action by the
         Company, the Rights Agent, the Acquiring Person or any other Person,
         and any holder of such Rights shall thereafter have no rights
         whatsoever with respect to such

                                      -10-
<PAGE>   14

         Rights, whether under this Agreement (including the right to exercise
         such Rights under any provision of this Agreement) or otherwise. No
         Right Certificate shall be issued pursuant to Section 3 that represents
         Rights beneficially owned by an Acquiring Person whose Rights would be
         null and void pursuant to the preceding sentence or by any Associate or
         Affiliate thereof; no Right Certificate shall be issued at any time
         upon the transfer of any Rights to an Acquiring Person whose Rights
         would be null and void pursuant to the preceding sentence or to any
         Associate or Affiliate thereof or to any nominee of such Acquiring
         Person, Associate or Affiliate; and any Right Certificate delivered to
         the Rights Agent for transfer to an Acquiring Person whose Rights would
         be null and void pursuant to the preceding sentence shall be canceled.

                  (ii) In lieu of issuing Common Shares in accordance with
         Section 11(a)(ii) hereof, the Company may, if the Board of Directors
         determines that such action is necessary or appropriate, elect to issue
         or pay, upon the exercise of the Rights, cash, property, Common Shares,
         shares of preferred stock, notes, debentures or other securities, or
         any combination thereof (collectively "substitute consideration"),
         having an aggregate value equal to the value of the Common Shares which
         otherwise would have been issuable pursuant to Section 11(a)(ii), which
         value of such substitute consideration shall be determined by a
         nationally recognized investment banking firm selected by the Board of
         Directors; provided, however, that, except as provided in the second
         and third sentences of subparagraph (ii) of this paragraph (a), each
         holder of a Right must receive the same consideration upon the exercise
         of a Right. For purposes of this subparagraph (iii) the value of Common
         Shares shall be as determined pursuant to Section 11(d) hereof and the
         value of any preferred stock or other securities comprising all or part
         of the substitute consideration which the Board of Directors determines
         to be the substantial equivalent of Common Shares shall be deemed to
         have the same value as the Common Shares.

                  (iii) Subject to subparagraph (iii) of this paragraph (a), in
         the event that there shall not be sufficient Common Shares issued but
         not outstanding or authorized but unissued to permit the exercise in
         full of the Rights in accordance with subparagraph (ii) of this
         paragraph (a), the Company shall take all such action as may be
         necessary to authorize additional Common Shares for issuance upon
         exercise of the Rights or, if unable to do so, shall take action
         permitted by subparagraph (iii) of this paragraph (a) in respect of
         substitute consideration in order to satisfy fully its obligations to a
         holder of Rights exercising such Rights as contemplated hereby.

                  (b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred Shares
entitling them (for a period expiring within 45 calendar days after such record
date) to subscribe for or purchase Preferred Shares (or shares having the same
rights, privileges and preferences as the Preferred Shares ("equivalent
preferred shares")) or securities convertible into Preferred Shares or
equivalent preferred shares at a price per Preferred Share or equivalent
preferred share (or having a conversion price per share, if a security
convertible into Preferred Shares or equivalent preferred shares) less than the
then current per share market price of the Preferred Shares (as defined in
Section 11(d)) on such record date, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the

                                      -11-
<PAGE>   15

numerator of which shall be the number of Preferred Shares outstanding on such
record date plus the number of Preferred Shares which the aggregate offering
price of the total number of Preferred Shares and/or equivalent preferred shares
so to be offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such current market
price and the denominator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of additional Preferred Shares
and/or equivalent preferred shares 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 in a consideration
part or all of which shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Board of Directors of
the Company, whose determination shall be described in a reasonably detailed
statement filed with the Rights Agent. Preferred Shares owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such rights, options or warrants are
not so issued, the Purchase Price shall be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.

                  (c) In case the Company shall fix a record date for the making
of a distribution to all holders of the Preferred Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular quarterly cash dividend paid out of earnings or
retained earnings or a dividend payable in Preferred Shares) 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 then current per share market
price of the Preferred Shares 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 reasonably detailed statement filed with
the Rights Agent) of the portion of the assets or evidences of indebtedness so
to be distributed or of such subscription rights or warrants applicable to one
Preferred Share and the denominator of which shall be such current per share
market price of the Preferred Shares. 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 again be adjusted to be
the Purchase Price which would then be in effect if such record date had not
been fixed.

                      (d) (i) For the purpose of any computation hereunder, the
         "current per share market price" of any security (a "Security" for the
         purpose of this Section 11(d)(i)) on any date shall be deemed to be the
         average of the daily closing prices per share of such Security for the
         30 consecutive Trading Days (as such term is hereinafter defined)
         immediately prior to, but not including, such date; provided, however,
         that in the event that the current per share market price of the
         Security is determined during a period following the announcement by
         the issuer of such Security of (A) a dividend or distribution on such
         Security payable in shares of such Security or securities convertible
         into such shares, or (B) any subdivision, combination or
         reclassification of such Security and prior to, but not including, the
         expiration of 30 Trading Days after the ex-dividend date for such
         dividend or distribution, or the record date for such subdivision,
         combination or reclassification, then, and in each such case, the
         current per share market

                                      -12-
<PAGE>   16

         price shall be appropriately adjusted to reflect the current market
         price per share equivalent of such Security taking into account
         ex-dividend trading. The closing price for each day shall be the last
         sale price, regular way, or, in case no such sale takes place on such
         day, the average of the closing bid and asked prices, regular way, in
         either case as reported in the principal consolidated transaction
         reporting system with respect to securities listed or admitted to
         trading on the Nasdaq National Market or, if the Security is not listed
         or admitted to trading on the Nasdaq National Market, as reported in
         the principal consolidated transaction reporting system with respect to
         securities listed on the principal national securities exchange on
         which the Security is listed or admitted to trading or, if the Security
         is not listed or admitted to trading on any national securities
         exchange, the last quoted sales price or, if not so quoted, the average
         of the high bid and low asked prices in the over-the-counter market, as
         reported by the National Association of Securities Dealers, Inc.
         Automated Quotations System ("NASDAQ") or such other system then in use
         or, if on any such date the Security is not quoted by any such
         organization, the average of the closing bid and asked prices as
         furnished by a professional market maker making a market in the
         Securities selected by the Board of Directors of the Company. The term
         "Trading Day" shall mean a day on which the principal national
         securities exchange on which the Security is listed or admitted to
         trading is open for the transaction of business or, if the Security is
         not listed or admitted to trading on any national securities exchange,
         a Business Day.

                      (i) For the purpose of any computation hereunder, the
         "current per share market price" of the Preferred Shares shall be
         determined in accordance with the methods set forth in Section
         11(d)(i). If the Preferred Shares are not publicly traded, the "current
         per share market price" of the Preferred Shares shall be conclusively
         deemed to be the current per share market price of the Common Shares as
         determined pursuant to Section 11(d)(i) (appropriately adjusted to
         reflect any stock split, stock dividend or similar transaction
         occurring after the date hereof), multiplied by one thousand. If
         neither the Common Shares nor the Preferred Shares are publicly held or
         so listed or traded, and no market maker is making, or has made during
         the relevant period, a market in the Common Shares or the Preferred
         Shares, "current per share market price" shall mean the fair value per
         share as determined in good faith by the Board of Directors of the
         Company, whose determination shall be described in a reasonably
         detailed statement filed with the Rights Agent.

                  (e) 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 which by reason of
this Section 11(e) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
Section 11 shall be made to the nearest cent or to the nearest one ten-millionth
interest in a Preferred Share or one one-hundredth interest in any other share
or security, as the case may be. Notwithstanding the first sentence of this
Section 11(e), any adjustment required by this Section 11 shall be made no later
than the earlier of (i) three years from the date of the transaction which
requires such adjustment or (ii) the date of the expiration of the right to
exercise any Rights.

                                      -13-
<PAGE>   17

                  (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 any shares of capital stock of the Company
other than Preferred Shares or interests therein, thereafter the number of such
other shares so receivable upon exercise of any Right shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions of this Section 11 with respect to the Preferred
Shares and the provisions of Sections 7, 9, 10, 12, 13 and 14 with respect to
the Preferred Shares shall apply on like terms to any such other shares.

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

                  (h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Sections 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
one one-hundredth interests in a Preferred Share (calculated to the nearest one
ten-millionth of a Preferred Share) obtained by (i) multiplying (A) the number
of one one-hundredth interests in a Preferred Shares covered by a Right
immediately prior to such adjustment by (B) 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 substitution
for any adjustment in the number of one one-hundredth interests in a Preferred
Share purchasable upon the exercise of a Right. Each of the Rights outstanding
after such adjustment of the number of Rights shall be exercisable for the
number of one one-hundredth interests in a Preferred Share for which a Right was
exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest one one-hundredth) 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 (and shall
promptly notify the Rights Agent of any such election) if any, 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. Such record date may be the
date on which the Purchase Price is adjusted or any date thereafter, but, if the
Right Certificates have been issued, shall be at least 10 days later than the
date of the public announcement. If Right Certificates have been issued, upon
each adjustment of the number of Rights pursuant to this Section 11(i), the
Company shall, as promptly as practicable, cause to be distributed to holders of
record of Right Certificates on such record date Right 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 Right Certificates held by such holders prior to the date of
adjustment, and upon

                                      -14-
<PAGE>   18

surrender thereof, if required by the Company, new Right Certificates evidencing
all the Rights to which such holders shall be entitled after such adjustment.
Right Certificates so to be distributed shall be issued, executed and
countersigned in the manner provided for herein and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.

                  (j) Irrespective of any adjustment or change in the Purchase
Price or the number of one one-hundredth interests in a Preferred Share issuable
upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Purchase Price and the number of
one one-hundredth interests in a Preferred Shares which were expressed in the
initial Right Certificates issued hereunder.

                  (k) Before taking any action that would cause an adjustment
reducing the Purchase Price below one one-hundredth of then par value, if any,
of the Preferred Shares issuable upon exercise of the Rights, the Company shall
take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue fully paid and
nonassessable Preferred Shares 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 (with prompt written notice
thereof to the Rights Agent) until the occurrence of such event the issuance to
the holder of any Right exercised after such record date of the Preferred Shares
and other capital stock or securities of the Company, if any, issuable upon such
exercise over and above the Preferred Shares 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 upon
the occurrence of the event requiring such adjustment.

                  (m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that the Company in its sole discretion shall
determine to be advisable in order that any consolidation or subdivision of the
Preferred Shares, issuance wholly for cash of any Preferred Shares at less than
the current market price, issuance wholly for cash of Preferred Shares or
securities which by their terms are convertible into or exchangeable for
Preferred Shares, dividends on Preferred Shares payable in Preferred Shares or
issuance of rights, options or warrants referred to in Section 11(b) hereafter
made by the Company to holders of Preferred Shares shall not be taxable to such
stockholders.

                  (n) In the event that at any time after the date of this
Agreement and prior to the Distribution Date, the Company shall (i) declare or
pay any dividend on the Common Shares payable in Common Shares, (i) reclassify
the Common Shares, or (i) otherwise effect a split-up, division or combination
of the Common Shares, then in any such case (i) the number of one one-hundredth
interests in a Preferred Share purchasable after such event upon proper exercise
of each Right shall be determined by multiplying the number of one one-hundredth
interests in a Preferred Share so purchasable immediately prior to such event by
a fraction, the numerator of which shall be the number of Common Shares that
were outstanding immediately before such

                                      -15-
<PAGE>   19

event and the denominator of which shall be the number of Common Shares that are
outstanding immediately after such event, and (ii) each Common Share outstanding
immediately after such event shall have issued with respect to it that number of
Rights which each Common Share outstanding immediately prior to such event had
issued with respect to it. The adjustments provided for in this Section 11(n)
shall be made successively whenever any such event occurs.

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

         Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Sections 11 or 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment
and a brief, reasonably detailed statement of the facts, computations and
methodology accounting for such adjustment, (a) file with the Rights Agent and
with each transfer agent for the Common Shares or the Preferred Shares a copy of
such certificate and (a) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 25 hereof.

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

                  (a) In the event, directly or indirectly, (i) the Company
shall consolidate with, merge with and into, or effect a share exchange or
conversion with or into any Person, (ii) any Person shall merge with and into
the Company or effect a share exchange or conversion with or into the Company,
the Company shall be the continuing or surviving corporation in such transaction
and, in connection with such transaction, all or part of the Common Shares shall
be changed into or exchanged for stock or other securities of any Person
(including the Company) or cash or any other property, or (iii) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one or more transactions, assets or earning power
aggregating 50% or more 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 one or more of its wholly-owned Subsidiaries, then, and in each such case,
proper provision shall be made so that (i) each holder of a Right (except as
otherwise provided herein) shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then current Purchase Price multiplied
by the number of one one-hundredth interests in a Preferred Share for which a
Right is then exercisable, in accordance with the terms of this Agreement and in
lieu of Preferred Shares, such number of duly authorized and validly issued,
fully paid and non-assessable Common Shares of the Principal Party (as defined
in Section 13(b) hereof) as shall equal the result obtained by (A) multiplying
the then current Purchase Price by the number of one one-hundredth interests in
a Preferred Share for which a Right is then exercisable and dividing that
product by (B) 50% of the then current per share market price of the Common
Shares of the Principal Party (determined pursuant to Section 11(d) hereof) on
the date of consummation of such transaction; (ii) the Principal Party shall
thereafter be liable for, and shall assume, by virtue of such transaction, all
the obligations and duties of the Company pursuant to this Agreement; (iii) the
term "Company", as used in this Agreement, shall thereafter be deemed to mean
the Principal Party; and (iv) such Principal Party shall take such steps
(including, but not limited to, the

                                      -16-
<PAGE>   20

reservation of a sufficient number of its Common Shares in accordance with this
Agreement) in connection with such consummation as may be necessary to assure
that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to the Common Shares of the Principal Party
thereafter deliverable upon the exercise of the Rights. The Company shall not
consummate any such transaction unless prior thereto the Company and the
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement so providing and further providing that, immediately
after the date of any such transaction mentioned in this paragraph (a) of this
Section 13, the Principal Party at its own expense will (i) prepare and file a
registration statement under the Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on an appropriate form, will
cause such registration statement to become effective as soon as possible after
such filing and will cause such registration statement to remain effective (with
a prospectus at all times meeting the requirements of the Act) until no longer
required under the Act with respect to securities purchasable upon exercise of
the Rights; and (ii) qualify or register the Rights and the securities
purchasable upon exercise of the Rights, and take all such other action as may
be required or as is appropriate, under the securities or blue sky laws of such
jurisdictions as may be necessary or appropriate. The Company shall not enter
into any transaction of the kind referred to in this Section 13 if at the time
of such transaction there are any rights, warrants, instruments or securities
outstanding or any agreements or arrangements which, as a result of the
consummation of such transaction, would eliminate or substantially diminish the
benefits intended to be afforded by the Rights. The provisions of this Section
13 shall similarly apply to successive mergers, consolidations, exchanges,
conversions, sales or other transfers.

                  (b) "Principal Party" shall mean

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

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

provided, however, that in any such case, (1) if the securities of such Person
are not at such time or have not been continuously over the preceding 12-month
period registered under Section 12 of the Exchange Act, and such Person is a
direct or indirect Subsidiary of another Person the securities of which are and
have been so registered, "Principal Party" shall mean such other Person; (2) in
case such Person is a Subsidiary, directly or indirectly, of more than one other
Person, the securities of two or more of which are and have been so registered,
"Principal Party" shall mean whichever of such other Persons is the issuer of
the securities so registered having the greatest aggregate market value; and (3)
in case such Person is owned, directly or indirectly, by a joint venture formed
by two or more other 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 Person
were a "Subsidiary" of both or all of such other Persons and the Principal
Parties in each such chain shall bear the obligations

                                      -17-
<PAGE>   21

set forth in this Section 13 in the same ratio as their direct and indirect
interests in such Person bear to the total of such interests.

         Section 14. Fractional Rights and Fractional Shares.

                  (a) The Company shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence fractional Rights. In
lieu of such fractional Rights, there shall be paid to the registered holders of
the Right Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For purposes of this Section 14(a), the
current market value of a whole Right shall be the closing price of the Rights
for the Trading Day immediately prior to, but not including, the date on which
such fractional Rights would otherwise be issuable. The closing price for any
day shall be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the Nasdaq
National Market or, if the Rights are not listed or admitted to trading on the
Nasdaq National Market, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the Rights are listed or admitted to trading or, if
the Rights are not listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by NASDAQ
or such other system then in use or, if on any such date the Rights are not
quoted by any such organization, the average of the closing bid and asked prices
as furnished by a professional market maker making a market in the Rights
selected by the Board of Directors of the Company. If on any such date no such
market maker is making a market in the Rights, the fair value of the Rights on
such date as determined in good faith by the Board of Directors of the Company
shall be used to determine the current market value of a Right for purposes of
this Section 14(a). Notwithstanding anything in this Section 14(a) to the
contrary, prior to the Distribution Date, the current market value of the Right
for purposes of this Section 14(a) shall be deemed to be zero.

                  (b) The Company shall not be required to issue fractional
interests in Preferred Shares (other than fractional interests which are
integral multiples of one one-hundredth of a Preferred Share) upon exercise of
the Rights or to distribute certificates which evidence fractional interests in
Preferred Shares (other than fractional interests which are integral multiples
of one one-hundredth of a Preferred Share). Fractional interests in Preferred
Shares in integral multiples of one one-hundredth of a Preferred Share may, at
the election of the Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary selected by it;
provided, however, that such agreement shall provide that holders of such
depositary receipts shall have all the rights, privileges and preferences to
which they are entitled as beneficial owners of the Preferred Shares represented
by such depositary receipts. In lieu of fractional interests in Preferred Shares
that are not integral multiples of one one-hundredth of a Preferred Share, the
Company shall pay to the registered holders of Right Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the current market value of one Preferred Share. For purposes of
this Section 14(b), the current market value of a Preferred Share shall be the
closing

                                      -18-
<PAGE>   22

price of a Preferred Share (as determined pursuant to the second sentence of
Section 11(d)(i) hereof) for the Trading Day immediately prior to, but not
including, the date of such exercise.

                  (c) 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 provided above).

                  (d) Whenever a payment for fractional Rights or fractional
shares is to be made by the Rights Agent, the Company shall (i) promptly prepare
and deliver to the Rights Agent a certificate setting forth in reasonable detail
the facts related to such payment and the prices and/or formulas utilized in
calculating such payments, and (ii) provide sufficient monies to the Rights
Agent in the form of fully collected funds to make such payments. The Rights
Agent shall be fully protected in relying upon such a certificate and shall have
no duty with respect to, and shall not be deemed to have knowledge of any
payment for fractional Rights or fractional shares under any Section of this
Agreement relating to the payment of fractional Rights or fractional shares
unless and until the Rights Agent shall have received such a certificate and
sufficient monies.

         Section 15. Rights of Action. All rights of action in respect of this
Agreement, excepting the rights of action given to the Rights Agent under
Section 18 and Section 20 hereof, are vested in the respective registered
holders of the Right Certificates (and, prior to the Distribution Date, the
registered holders of the Common Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares), without
the consent of the Rights Agent or of the holder of any other Right Certificate
(or, prior to the Distribution Date, of the Common Shares), 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, such holder's right to exercise the Rights evidenced by such Right
Certificate in the manner provided in such Right Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of the obligations of
any Person subject to, this Agreement.

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

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

                  (b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the office of the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer; and

                  (c) the Company and the Rights Agent may deem and treat the
Person in whose name any Right Certificate (or, prior to the Distribution Date,
the associated Common

                                      -19-
<PAGE>   23

Shares certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or writing
on the Right Certificates or the associated Common Shares 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.

                  (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, judgment or ruling (whether
interlocutory or final) issued by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission, or any statute,
rule, regulation or executive order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining performance of such obligation;
provided, however, that the Company must use its best efforts to have any such
order, decree, judgment or ruling lifted or otherwise overturned as soon as
possible.

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

         Section 18. Concerning the Rights Agent. The Company agrees to pay to
the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the preparation,
delivery, administration, execution and amendment 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, damage, judgment, fine, penalty, claim, demand, settlement, cost or
expense, incurred without gross negligence, bad faith or willful misconduct
(each as finally determined by a final, non-appealable order, judgment, decree
or ruling of a court of competent jurisdiction) on the part of the Rights Agent,
for any action taken, suffered or omitted by the Rights Agent in connection with
the acceptance and administration of this Agreement or the exercise and
performance of its duties hereunder, including, without limitation, the costs
and expenses of defending against any claim of liability in the premises. The
provisions of this Section 18 and Section 20 below shall survive the termination
of this Agreement, the exercise or expiration of the Rights, and the resignation
or removal of the Rights Agent. The costs and expenses incurred in enforcing
this right of indemnification shall be paid by the Company.

                                      -20-
<PAGE>   24

         The Rights Agent shall be fully and completely authorized and protected
and shall incur no liability for, or in respect of any action taken, suffered or
omitted by it in connection with, the acceptance and administration of this
Agreement in reliance upon any Right Certificate or certificate for the Common
Shares or for other securities of the Company, instrument of assignment or
transfer, power of attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement, or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons, or otherwise upon the advice of
counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed
to have any duty or notice unless and until the Company has provided the Rights
Agent with actual written notice.

         Section 19. Merger or Consolidation or Change of Name of Rights Agent.
Any Person into which the Rights Agent or any successor Rights Agent may be
merged or with which it may be consolidated, or any Person resulting from any
merger or consolidation to which the Rights Agent or any successor Rights Agent
shall be a party, or any Person succeeding to the shareholder services, stock
transfer or corporate trust business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Agreement without
the execution or filing of any paper or any further act on the part of any of
the parties hereto, provided that such Person 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 Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the countersignature of
the predecessor Rights Agent and deliver such Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall not
have been countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates and in this
Agreement.

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

         Section 20. Duties of Rights Agent. The Rights Agent undertakes only
the duties and obligations expressly imposed by this Agreement (and no implied
duties) upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates, by their acceptance thereof, shall be bound:

                  (a) The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the advice or opinion of such counsel
shall be full and complete authorization and protection to the Rights Agent and
the Rights Agent shall incur no liability for or in respect of any action taken,
suffered or omitted by it in good faith and in accordance with such advice or
opinion.

                                      -21-
<PAGE>   25

                  (b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering (or
omitting to take) any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be deemed to
be conclusively proved and established by a certificate signed by any one of the
Chairman of the Board of Directors, President, any Vice President, the Secretary
or the Treasurer of the Company and delivered to the Rights Agent; and such
certificate shall be full and complete authorization and protection to the
Rights Agent and the Rights Agent shall incur no liability for or in respect of
any action taken, suffered or omitted in good faith by it under the provisions
of this Agreement in reliance upon such certificate. The Rights Agent shall be
fully protected and authorized in relying upon the most recent instructions
received by any such officer.

                  (c) The Rights Agent shall be liable hereunder to the Company
and any other Person only for the Rights Agent's own gross negligence, bad faith
or willful misconduct (each as finally determined by a final, non-appealable
order, judgment, decree or ruling of a court of competent jurisdiction).
Anything in this Agreement to the contrary notwithstanding, in no event shall
the Rights Agent be liable for special, punitive, indirect, incidental or
consequential loss or damage of any kind whatsoever (including, but not limited
to, lost profits), even if the Rights Agent has been advised of the possibility
of such loss or damage. Any liability of the Rights Agent under this Agreement
shall be limited to the amount of fees paid by the Company to the Rights Agent.

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

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

                  (f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and

                                      -22-
<PAGE>   26

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 advice or instructions with respect to the performance of its duties
hereunder from any one of the Chairman of the Board of Directors, President, any
Vice President, the Secretary or the Treasurer of the Company, and to apply to
such officers for advice or instructions in connection with its duties, and such
advice or instructions shall be full authorization and protection to the Rights
Agent and the Rights Agent shall incur no liability for or in respect of any
action taken, suffered or omitted by it in good faith in accordance with the
advice or instructions of any such officer or for any delay in acting while
waiting for such advice or instructions.

                  (h) The Rights Agent and any stockholder, affiliate, 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 (including, without
limitation, acting as transfer agent for the Common Shares) or for any other
Person.

                  (i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, absent gross negligence, bad faith or
willful misconduct (each as finally determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction) in the
selection and continued employment thereof.

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

         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 Shares or Preferred Shares by registered or certified mail, and to
the holders of the Right Certificates by first-class mail. The Company may
remove the Rights Agent or any successor Rights Agent upon 30 days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may
be, and to each transfer agent of the Common Shares or Preferred Shares by
registered or certified mail, and to the holders of the Right Certificates by
first-class mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent. If the Company shall fail to make such appointment within a
period of 30 days after giving notice of such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right Certificate (who shall,
with such notice, submit his Right Certificate for inspection by the

                                      -23-
<PAGE>   27

Company), then the registered holder of any Right Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
shall be (i) a Person organized and doing business under the laws of the United
States or of the States of New York, New Jersey or Texas (or of any other state
of the United States so long as such Person is authorized to do business as a
banking institution in the State of New York, the State of New York or the State
of Texas), in good standing, which is authorized under such laws to conduct
shareholder services business and is subject to supervision or examination by
federal or state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $50 million; or (ii) an
Affiliate of such a Person described in clause (i) above. 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 the predecessor
Rights Agent 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 Shares
or Preferred Shares, and mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the appointment
of the successor Rights Agent, as the case may be.

         Section 22. Issuance of New Right Certificates. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Right Certificates evidencing Rights in such form
as may be approved by its Board of Directors to reflect any adjustment or change
in the Purchase Price and the number or kind or class of shares or other
securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Agreement.

         Section 23. Redemption.

                  (a) The Rights may be redeemed by action of the Board of
Directors of the Company pursuant to Section 23(b) and shall not be redeemed in
any other manner. Notwithstanding anything contained or implied in this
Agreement to the contrary, the Rights shall not be exercisable after the
occurrence of an event described in Section 11(a)(ii) hereof until such time as
the Company's rights of redemption hereunder have expired.

                  (b) The Board of Directors of the Company may, at its option,
at any time prior to the Close of Business on the tenth Business Day after the
Shares Acquisition Date, redeem all, but not less than all, the then outstanding
Rights at a redemption price of $.001 per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (such redemption price being hereinafter referred to as the
"Redemption Price"). The Company may, at its option, pay the Redemption Price in
cash, Common Shares (based on the current per share market price of the Common
Shares at the time of redemption determined pursuant to Section 11(d) hereof) or
any other form of consideration deemed appropriate by the Board of Directors of
the Company; provided, however, that if the Company elects to pay the Redemption
Price in Common Shares, the Company shall not be

                                      -24-
<PAGE>   28

required to issue fractional Common Shares and the number of Common Shares
issuable to each holder of Rights shall be rounded down to the next whole share.

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

         Section 24. Exchange.

                  (a) The Board of Directors of the Company may, at its option,
at any time after any Person becomes an Acquiring Person, exchange all or any
part of the then outstanding and exercisable Rights (which shall not include
Rights that have become null and void pursuant to the provisions of Section
11(a)(ii) hereof) for Common Shares at an exchange ratio of one Common Share per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").

                  (b) Immediately upon the action of the Board of Directors of
the Company ordering the exchange of any Rights pursuant to Section 24(a), 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 Common Shares equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio. The Company shall
promptly notify the Rights Agent in writing of any such exchange and shall give
public notice of any such exchange; provided, however, that the failure to give,
or any defect in, such notice shall not affect the validity of such exchange.
The Company shall promptly mail a notice of any such exchange to the Rights
Agent and to all of the holders of such Rights at their addresses as they appear
upon the registry books of the Rights Agent. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of exchange will state the method by which the
exchange of the Common Shares for Rights will be effected and, in the event of
any partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the

                                      -25-
<PAGE>   29

number of Rights (other than Rights which have become null and void pursuant to
the provisions of Section 11(a)(ii) hereof) held by each holder of Rights.

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

                  (d) In the event that there shall not be sufficient Common
Shares or Preferred Shares issued but not outstanding or authorized but unissued
to permit any exchange of Rights as contemplated in accordance with this Section
24, the Company shall take all such action as may be necessary to authorize
additional Common Shares or Preferred Shares for issuance upon exchange of the
Rights. In the event that the Company, after good faith effort, shall be unable
to take such action as may be necessary to authorize such additional Common
Shares or Preferred Shares, the Company shall substitute, for each Common Share
or Preferred Share that would otherwise be issuable upon exchange of a Right, a
number of Common Shares, Preferred Shares or shares of preferred stock, notes,
debentures or other securities, or any combination thereof, having an aggregate
value equal to the Rights to be exchanged, which value shall be determined by a
nationally recognized investment banking firm selected by the Board of
Directors.

                  (e) The Company shall not be required to issue fractions of
Common Shares or to distribute certificates which evidence fractional Common
Shares. In lieu of such fractional Common Shares, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional Common Shares would otherwise be issuable an amount in cash equal to
the same fraction of the current market value of a whole Common Share. For the
purposes of this Section 24(e), the current market value of a whole Common Share
shall be the closing price of a Common Share (as determined pursuant to the
second sentence of Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of exchange pursuant to this Section 24.

         Section 25. Notice of Certain Events.

                  (a) In case the Company shall propose (i) to pay any dividend
payable in stock of any class to the holders of Preferred Shares or to make any
other distribution to the holders of Preferred Shares (other than a regular
quarterly cash dividend), (i) to offer to the holders of Preferred Shares rights
or warrants to subscribe for or to purchase any additional Preferred Shares or
shares of stock of any class or any other securities, rights or options, (i) to
effect any reclassification of Preferred Shares (other than a reclassification
involving only the subdivision of outstanding Preferred Shares), (i) to effect
any consolidation or merger into or with, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale or
other transfer), in one or more transactions, of 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person, (i) to effect the liquidation, dissolution or winding up of the
Company, or (i) to declare or pay any dividend

                                      -26-
<PAGE>   30

on the Common Shares payable in Common Shares, to reclassify the Common Shares,
or to otherwise effect a split-up, division or combination of the Common Shares,
then, in each such case, the Company shall give to the Rights Agent and to each
holder of a Right Certificate, in accordance with Section 26 hereof, a notice of
such proposed action, which shall specify the record date for purposes of such
stock dividend, or distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of the Common Shares and/or Preferred Shares, if any such
date is to be fixed, and such notice shall be so given in the case of any action
described by clause (i) or (ii) above at least 10 days prior to the record date
for determining holders of the Preferred Shares for purposes of such action, and
in the case of any such other action, at least 10 days prior to the date of the
taking of such proposed action or the date of participation therein by the
holders of the Common Shares and/or Preferred Shares, whichever shall be the
earlier.

                  (b) In case the event set forth in Section 11(a)(ii) hereof
shall occur, then the Company shall as soon as practicable thereafter give to
the Rights Agent and to each holder of a Right Certificate, in accordance with
Section 26 hereof, a notice of the occurrence of such event, which notice shall
describe the event and the consequences of the event to holders of Rights under
Section 11(a)(ii) hereof.

         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 Right 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:

                     BindView Development Corporation
                     5151 San Felipe, 25th Floor
                     Houston, Texas 77056
                     Attention: President

Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right 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:

                     Mellon Investor Services LLC
                     600 North Pearl Street
                     Suite 1010
                     Dallas, TX 75201-2884
                     Attention: Relationship Manager

                     with a copy to:

                     Mellon Investor Services LLC
                     85 Challenger Road
                     Ridgefield Park, NJ 07660
                     Attention: General Counsel

                                      -27-
<PAGE>   31

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

         Section 27. Supplements and Amendments. The Company may (and the Rights
Agent shall at the direction of the Company) from time to time supplement or
amend this Agreement without the approval of any holders of Right Certificates
in order (i) at any time, to cure any ambiguity, (i) at any time, to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein, (i) prior to the Distribution Date, to change
or supplement any of the provisions hereof in any manner which the Company may
deem necessary or desirable (including, but without any limitation, changing the
percentage of ownership of Common Shares at which a Person becomes an Acquiring
Person, the Distribution Date, the time for redemption of Rights or the time
for, or limits on, amendment of this Agreement) or (i) after the Distribution
Date, to change or supplement the provisions hereof in any manner which the
Company may deem necessary or desirable and which shall not adversely affect the
interests of the holders of the Rights Certificates (other than an Acquiring
Person or an Affiliate or Associate of an Acquiring Person), any such supplement
or amendment to be evidenced by a writing signed by the Company and the Rights
Agent. Upon the delivery of a certificate from an appropriate officer of the
Company and, if requested by the Rights Agent, an opinion of counsel, that
states that the proposed supplement or amendment is in compliance with the terms
of this Section 27 and, provided such supplement or amendment does not change or
increase the Rights Agent's rights, duties, liabilities or obligations
hereunder, the Rights Agent shall execute such supplement or amendment.

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

         Section 30. 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 the foregoing, 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 materially and adversely affect the purpose and effect of
this Agreement, the right of redemption set forth in Section 23 hereof shall be
reinstated

                                      -28-
<PAGE>   32

and shall not expire until the Close of Business on the 10th day following the
date of such determination by the Board of Directors.

         Section 31. Determinations and Actions by the Board of Directors. For
all purposes of this Agreement, any calculation of the number of Common Shares
or Preferred Shares outstanding at a particular time, including for purposes of
determining the particular percentage of such outstanding Common Shares or
Preferred Shares of which any Person is the Beneficial Owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules
and Regulations under the Exchange Act as in effect on the date hereof. The
Board of Directors of the Company shall have the exclusive power and authority
to administer this Agreement and to exercise all rights and powers specifically
granted to the Board 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 a determination to redeem or not
redeem the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the Board
of Directors of the Company in good faith, shall (x) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Rights and all
other Persons, and (y) not subject the Board of Directors of the Company to any
liability to the holders of the Rights. The Rights Agent shall always be
entitled to assume that the Company's Board of Directors acted in good faith and
shall be fully protected and shall incur no liability in reliance thereon.

         Section 32. Governing Law. THIS AGREEMENT AND EACH RIGHT CERTIFICATE
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF TEXAS AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS TO BE MADE AND
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED, HOWEVER, THAT ALL PROVISIONS
REGARDING THE RIGHTS, DUTIES AND OBLIGATIONS OF THE RIGHTS AGENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
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, 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.

                                      -29-
<PAGE>   33

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

                                 BINDVIEW DEVELOPMENT CORPORATION

                                 By:
                                      ------------------------------------------
                                 Name:  Eric J. Pulaski
                                 Title: Chairman of the Board, President,
                                        and Chief Executive Officer

                                 MELLON INVESTOR SERVICES LLC

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

                                      -30-
<PAGE>   34
                                   EXHIBIT A

              STATEMENT OF RESOLUTION ESTABLISHING SERIES OF SHARES

                        BINDVIEW DEVELOPMENT CORPORATION

                      STATEMENT OF RESOLUTION ESTABLISHING
                                SERIES OF SHARES

TO THE SECRETARY OF STATE
  OF THE STATE OF TEXAS:

         Pursuant to the provisions of Article 2.13 of the Texas Business
Corporation Act, the undersigned corporation submits the following statement for
the purpose of establishing and designating a series of shares and fixing and
determining the relative rights and preferences thereof:

         1. The name of the Corporation is BindView Development Corporation.

         2. The following resolution, establishing and designating a series of
shares and fixing and determining the relative rights and preferences thereof,
was duly adopted by the Board of Directors of the Corporation on September 17,
2001.

         RESOLVED, that pursuant to Amended and Restated Articles of
Incorporation of the Corporation authorizing the Board of Directors to establish
and designate series of preferred stock, $0.01 par value, of the Corporation
(the "Preferred Stock") and to fix and determine the relative rights and
preferences of the shares of any such series , there is hereby designated a
series of Preferred Stock to be called "Series A Preferred Stock" to consist of
1,000,000 shares and to have the following terms:

                  Section 1. Dividends and Distributions.

                  (a) Subject to the rights of holders of shares of any series
of Preferred Stock that ranks prior to the Series A Preferred Stock with respect
to dividends, the holders of shares of Series A Preferred Stock, in preference
to the rights of holders of shares of Common Stock, no par value per share
("Common Stock"), of the Corporation with respect to dividends, and in
preference to the rights of holders of shares of any series of Preferred Stock
that ranks junior to the Series A Preferred Stock with respect to dividends,
shall be entitled to receive, when, as and if declared by the Board out of funds
legally available for that purpose, quarterly dividends, which shall be payable
in cash except as hereinafter provided, on the first day of January, April, July
and October in each year during which a share or fraction of a share of Series A
Preferred Stock is outstanding (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, each such dividend to be in an amount per share
(rounded to the nearest cent) equal to:

                                      A-1
<PAGE>   35

                      (i) subject to the provision for adjustment set forth in
         the next succeeding sentence,

                            (A) 100 times the aggregate per share amount of all
                      cash dividends declared on the Common Stock after the
                      immediately preceding Quarterly Dividend Payment Date or,
                      with respect to the first Quarterly Dividend Payment Date,
                      after the first issuance of any share or fraction of a
                      share of Series A Preferred Stock, plus

                            (B) 100 times the aggregate per share amount, which
                      shall be payable in kind, of all non-cash dividends or
                      other distributions (other than (x) a dividend on the
                      Common Stock that is payable in shares of Common Stock or
                      (y) a distribution solely on account of a reclassification
                      of, or other split-up, division or combination of shares
                      of, Common Stock) declared on the Common Stock after the
                      immediately preceding Quarterly Dividend Payment Date or,
                      with respect to the first Quarterly Dividend Payment Date,
                      after the first issuance of any share or fraction of a
                      share of Series A Preferred Stock; or

                      (ii) if no dividend or other distribution (other than (x)
         a dividend on the Common Stock that is payable in shares of Common
         Stock or (y) a distribution solely on account of a reclassification of,
         or other split-up, division or combination of shares of, Common Stock)
         shall have been declared on the Common Stock after the immediately
         preceding Quarterly Dividend Payment Date or, with respect to the first
         Quarterly Dividend Payment Date, after the first issuance of any share
         or fraction of a share of Series A Preferred Stock, $0.01.

In the event that the Corporation shall at any time after September 17, 2001,
(1) declare a dividend on the Common Stock that is payable in shares of Common
Stock, (2) reclassify the Common Stock or (3) otherwise effect a split-up,
division or combination of shares of Common Stock, then in each such case the
amount per share to which holders of shares of Series A Preferred Stock were
entitled immediately prior to such event under Section 2(a)(i) shall be adjusted
by multiplying such amount by a fraction, the numerator of which shall be the
number of shares of Common Stock that are outstanding immediately after such
event and the denominator of which shall be the number of shares of Common Stock
that were outstanding immediately prior to such event.

                  (b) Immediately after the Board declares a dividend or other
distribution on the Common Stock (other than (x) a dividend on the Common Stock
that is payable in shares of Common Stock or (y) a distribution solely on
account of a reclassification of, or other split-up, division or combination of
shares of, Common Stock), if any share or fraction of a share of Series A
Preferred Stock is then outstanding, the Board shall declare a dividend on the
Series A Preferred Stock, which shall be payable at the time and in the amount
provided in Section 2(a). If (i) any share or fraction of a share of Series A
Preferred stock is then outstanding, (ii) no dividend or other distribution
(other than (x) a dividend on the Common Stock that is payable in shares of
Common Stock or (y) a distribution solely on account of a reclassification of,
or other split-up, division or combination of shares of, Common Stock) shall
have been declared on the

                                      A-2
<PAGE>   36

Common Stock during the period between the immediately preceding Quarterly
Dividend Payment Date and the next succeeding Quarterly Dividend Payment Date
or, with respect to the first Quarterly Dividend Payment Date, between the date
of the first issuance of any share or fraction of a share of Series A Preferred
Stock and such first Quarterly Dividend Payment Date, and (iii) there are funds
legally available for the payment of a dividend on the Series A Preferred Stock,
the Board shall, at any time prior to such next succeeding Quarterly Dividend
Payment Date or such first Quarterly Dividend Payment Date, as the case may be,
declare a dividend of $0.01 per share on the Series A Preferred Stock, which
shall be payable on such next succeeding Quarterly Dividend Payment Date or such
first Quarterly Dividend Payment Date, as the case may be.

                  (c) Dividends on shares of Series A Preferred Stock shall
begin to accrue and be cumulative from the Quarterly Dividend Payment Date that
immediately precedes the date of issuance of such shares unless (i) the date of
issuance of such shares is prior to the record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive a dividend on
the first Quarterly Dividend Payment Date, in which event dividends on such
shares shall begin to accrue and be cumulative from the date of issuance of such
shares, (ii) the date of issuance of such shares is a Quarterly Dividend Payment
Date, in which event dividends on such shares shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date, or (iii) the date of
issuance of such shares is a date after the record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive a dividend on
the Quarterly Dividend Payment Date that next succeeds the date of issuance of
such shares, in which event dividends on such shares shall begin to accrue and
be cumulative from such next succeeding Quarterly Dividend Payment Date. Accrued
but unpaid dividends on shares of Series A Preferred Stock shall not bear
interest. If a dividend is declared on the Series A Preferred Stock and the
total amount of that dividend is less than the total amount of all dividends
accrued and payable on all shares of Series A Preferred Stock at the time of
payment of that dividend, then the portion of the total amount of that dividend
to be allocated to each of such shares shall be determined by multiplying the
total amount of that dividend by a fraction, the numerator of which shall be the
total amount of all dividends accrued and payable on that share at that time and
the denominator of which shall be the total amount of all dividends accrued and
payable on all such shares at that time. The Board may fix a record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a dividend or other distribution on the Series A Preferred Stock, which
record date shall be no more than 30 days prior to the date fixed for the
payment of that dividend or other distribution.

                  (d) If at any time (i) any holder of shares of Series A
Preferred Stock would have been entitled under the foregoing provisions of this
Section 2 to have received by that time a dividend on such shares, assuming that
such dividend had been declared, out of funds legally available for that
purpose, at the time and in the amount provided in the foregoing provisions of
this Section 2, and (ii) such dividend or any part thereof has not been paid to
such holder, then such dividend or part thereof shall be considered accrued and
payable at that time.

                  Section 2. Voting.

                  (a) Subject to the provision for adjustment set forth in the
next succeeding sentence, each share of Series A Preferred Stock shall, except
as otherwise provided by law,

                                      A-3
<PAGE>   37

entitle the holder thereof to 100 votes on each matter that is submitted to a
vote of stockholders of the Corporation. In the event that the Corporation shall
at any time after September 17, 2001, (i) declare a dividend on the Common Stock
that is payable in shares of Common Stock, (ii) reclassify the Common Stock or
(iii) otherwise effect a split-up, division or combination of shares of Common
Stock, then in each such case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction, the numerator of
which shall be the number of shares of Common Stock that are outstanding
immediately after such event and the denominator of which shall be the number of
shares of Common Stock that were outstanding immediately prior to such event.

                  (b) Except as otherwise provided by law or in the Amended and
Restated Articles of Incorporation of the Corporation or the resolution or
resolutions of the Board providing for the issuance of shares of Preferred Stock
(including but not limited to these resolutions):

                           (i) the holders of shares of Series A Preferred
                  Stock, the holders of shares of Common Stock and the holders
                  of shares of any other class or series of capital stock of the
                  Corporation having general voting rights shall vote together
                  as a single class on each matter that is submitted to a vote
                  of stockholders of the Corporation, and

                           (ii) the holders of shares of Series A Preferred
                  Stock shall not have any special voting rights.

                  Section 3. Certain Restrictions. Unless and until all
dividends at the time accrued and payable on all shares of Series A Preferred
Stock have been paid in full, the Corporation shall not:

                  (a) declare or pay any dividend, or make any other
distribution, on any class or series of capital stock of the Corporation that
ranks junior, either with respect to dividends or upon liquidation, dissolution
or winding up, to the Series A Preferred Stock (any such class or series being
referred to herein as "Junior Stock");

                  (b) declare or pay any dividend, or make any other
distribution, on any class or series of capital stock of the Corporation that
ranks in parity, either with respect to dividends or upon liquidation,
dissolution or winding up, with the Series A Preferred Stock (any such class or
series being referred to herein as "Parity Stock"), except dividends that are
paid ratably on all shares of Series A Preferred Stock on which dividends are at
the time accrued and payable and all shares of Parity Stock on which dividends
are at the time accrued and payable in proportion to the total amounts of
dividends at the time accrued and payable on all such shares;

                  (c) redeem, purchase or otherwise acquire for consideration
any shares of Junior Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of Junior Stock in exchange for
shares of other Junior Stock; or

                  (d) redeem, purchase or otherwise acquire for consideration
any shares of Series A Preferred Stock or any shares of Parity Stock, except in
accordance with an offer to

                                      A-4
<PAGE>   38

purchase made in writing to all holders of such shares upon terms that the
Board, after considering the relative rights and preferences of the respective
series and classes of such shares, considers in good faith will result in fair
and equitable treatment among the holders of such shares.

                  Section 4. Reacquired Shares. Any shares of Series A Preferred
Stock that are purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the acquisition thereof.
Upon their cancellation, all of such shares shall become authorized but unissued
shares of Preferred Stock and thereafter may be issued as part of another series
of Preferred Stock, subject to the rights of holders (if any) of shares of
Series A Preferred Stock set forth in these resolutions.

                  Section 5. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation:

                  (a) no distribution shall be made to the holders of shares of
Junior Stock unless, prior to such distribution, the Corporation shall have paid
to each holder of shares of Series A Preferred Stock the sum of (i) $0.01 per
share of Series A Preferred Stock held by such holder (such amount per share
being referred to herein as the "Preference Amount") plus (ii) the total amount
of all dividends at the time accrued and payable on all shares of Series A
Preferred Stock held by such holder;

                  (b) no distribution shall be made to the holders of shares of
Parity Stock, except distributions that are made ratably on both all shares of
Series A Preferred Stock and all shares of Parity Stock in proportion to the
total amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up; and

                  (c) each holder of shares of Series A Preferred Stock shall be
entitled to receive the sum of (i) the total amount of all dividends at the time
accrued and payable on all shares of Series A Preferred Stock held by such
holder plus (ii) an aggregate amount per share (such amount per share being
referred to herein as the "Distributable Amount"), inclusive of the Preference
Amount but subject to the provision for adjustment set forth in the next
succeeding sentence, of Series A Preferred Stock held by such holder that is
equal to 100 times the aggregate per share amount to be distributed to holders
of shares of Common Stock upon such liquidation, dissolution or winding up.

In the event that the Corporation shall at any time after September 17, 2001,
(1) declare a dividend on the Common Stock that is payable in shares of Common
Stock, (2) reclassify the Common Stock or (3) otherwise effect a split-up,
division or combination of shares of Common Stock, then in each such case the
Distributable Amount to which a holder of shares of Series A Preferred Stock was
entitled immediately prior to such event shall be adjusted by multiplying such
Distributable Amount by a fraction, the numerator of which shall be the number
of shares of Common Stock that are outstanding immediately after such event and
the denominator of which shall be the number of shares of Common Stock that were
outstanding immediately prior to such event.

                                      A-5
<PAGE>   39

                  Section 6. Consolidation, Merger, etc. If the Corporation
shall enter into any consolidation, merger, share exchange or other transaction
in which all outstanding shares of Common Stock are exchanged for or changed
into other securities, cash, other property or any combination thereof, then
each outstanding share of Series A Preferred Stock shall at the same time be
similarly exchanged for or changed into an amount per share, subject to the
provision for adjustment set forth in the next succeeding sentence, equal to 100
times the aggregate amount of securities, cash and other property for which each
outstanding share of Common Stock is exchanged or into which each outstanding
share of Common Stock is changed. In the event that the Corporation shall at any
time after September 17, 2001, (1) declare a dividend on the Common Stock that
is payable in shares of Common Stock, (2) reclassify the Common Stock or (3)
otherwise effect a split-up, division or combination of shares of Common Stock,
then in each such case the amount per share for which Series A Preferred Stock
would be exchanged, or into the amount which Series A Preferred Stock would be
changed, immediately prior to such event under the immediately preceding
sentence of this Section 7, shall be adjusted by multiplying such amount by a
fraction, the numerator of which shall be the number of shares of Common Stock
that are outstanding immediately after such event and the denominator of which
shall be the number of shares of Common Stock that were outstanding immediately
prior to such event.

                  Section 7. Redemption. The shares of Series A Preferred Stock
shall not be redeemable.

                  Section 8. Ranking. The Series A Preferred Stock shall rank
junior to each other series of Preferred Stock, both with respect to dividends
and upon liquidation, dissolution or winding up, unless the statement of
resolution establishing such other series of Preferred Stock shall provide
otherwise.

                  Section 9. Amendment. If any share or fraction of a share of
Series A Preferred Stock is outstanding, neither the Amended and Restated
Articles of Incorporation of the Corporation nor the resolution or resolutions
of the Board providing for the issuance of shares of Preferred Stock (including
but not limited to these resolutions) shall be amended in any manner that would
materially alter or change the powers, preferences or rights of holders of
shares of Series A Preferred Stock so as to affect such holders adversely unless
that amendment shall have received the affirmative vote of the holders of a
majority of the outstanding shares of Series A Preferred Stock voting separately
as a class. Notwithstanding the foregoing provisions of this Section 10, whether
or not a share or a fraction of a share of Series A Preferred Stock is
outstanding, (a) the Board may from time to time provide by resolution or
resolutions for the issuance of shares of Preferred Stock of one or more series
that rank prior to the Series A Preferred Stock, either with respect to
dividends or upon liquidation, dissolution or winding up, or both with respect
to dividends and upon liquidation, dissolution or winding up, and (b) no vote or
consent of any holder of shares of Series A Preferred Stock shall be required
either as a condition to the adoption of such resolution or resolutions or as a
condition to the issuance of such shares of Preferred Stock.

                  Section 10. Fractional Shares. Series A Preferred Stock may be
issued in fractions of a share. Each holder of a fraction of a share of Series A
Preferred Stock shall be entitled to exercise voting rights, to receive
dividends and other distributions, and to have all

                                      A-6
<PAGE>   40

other rights of the holders of whole shares of Series A Preferred Stock in
proportion to the fraction of a share of Series A Preferred Stock held by that
holder.

         RESOLVED FURTHER, that the appropriate officers of the Corporation are
authorized to make such filings and to take any other actions they deem
necessary to effect the foregoing resolution.

Dated:  September 17, 2001               BINDVIEW DEVELOPMENT CORPORATION

                                         By:
                                              ----------------------------------
                                         Name:  D. C. Toedt III
                                         Title: Secretary

                                      A-7
<PAGE>   41
                                   EXHIBIT B

                            FORM OF RIGHT CERTIFICATE

Certificate No. R                                         _______________ Rights

         NOT EXERCISABLE AFTER SEPTEMBER 17, 2011, OR EARLIER IF REDEMPTION OR
         EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.001 PER
         RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.

                                Right Certificate

                        BindView Development Corporation

         This certifies that _________________________________, or registered
assigns, is the registered owner of the number of Rights set forth above, each
of which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement, dated as of September 17, 2011 (the "Rights
Agreement"), between BindView Development Corporation, a Texas corporation (the
"Company"), and Mellon Investor Services LLC, a New Jersey limited liability
company (the "Rights Agent"), to purchase from the Company at any time after the
Distribution Date (as such term is defined in the Rights Agreement) and prior to
the Close of Business (as defined in the Rights Agreement) on September 17,
2011, at the principal offices of the Rights Agent, or at the offices of its
successor as Rights Agent, one one-hundredth interest in one share of Series A
Preferred Stock, par value $.01 per share (the "Preferred Shares"), of the
Company, at a purchase price of $11.00 per one one-hundredth interest in a
Preferred Share (the "Purchase Price"), upon presentation and surrender of this
Right Certificate with the Form of Election to Purchase duly executed. The
number of Rights evidenced by this Right Certificate (and the number of one
one-hundredth interests in a Preferred Share which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth above, are
the number and Purchase Price as of September 21, 2001, based on the Preferred
Shares as constituted at such date. As provided in the Rights Agreement, the
Purchase Price and the number of one one-hundredth interests in a Preferred
Share which may be purchased upon the exercise of the Rights evidenced by this
Right Certificate are subject to modification and adjustment upon the happening
of certain events.

         This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof 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 Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices of the
Company and the above-mentioned offices of the Rights Agent.

                                      B-1
<PAGE>   42

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

         Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate (i) may be redeemed by the Company at a redemption price of
$.001 per Right payable in cash, Preferred Shares or other consideration or (ii)
may be exchanged in whole or in part for Preferred Shares or shares of the
Company's Common Stock, no par value per share.

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

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

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

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

         Dated as of ________________, _____.

                                       BINDVIEW DEVELOPMENT CORPORATION

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

Countersigned:
                                       -----------------------------------------

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

                                      B-2
<PAGE>   43

                                      B-3
<PAGE>   44

                    FORM OF REVERSE SIDE OF RIGHT CERTIFICATE

                               FORM OF ASSIGNMENT

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

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

         Dated:  _____________, ______.

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

Signature Guarantee:

         Signatures must be guaranteed by an "eligible guarantor institution"
(such as a bank, stockbroker, credit union or savings association) pursuant to
Rule 17Ad-15 of the Rules and Regulations of the Securities Exchange Act of
1934.

================================================================================

         The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and that
after due inquiry and to the best of the knowledge of the undersigned, it did
not acquire the Rights evidenced by this Rights Certificate for any Person who
is, was or subsequently became an Acquiring Person or an Affiliate or Associate
of such Person.

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

================================================================================

                                      B-4
<PAGE>   45

             FORM OF REVERSE SIDE OF RIGHT CERTIFICATE -- CONTINUED

                          FORM OF ELECTION TO PURCHASE

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

To:  BindView Development Corporation

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

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

--------------------------------------------------------------------------------
           (Please insert social security or other identifying number)

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

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

--------------------------------------------------------------------------------
           (Please insert social security or other identifying number)

Dated:  _____________, _____.

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

Signature Guarantee:

         Signatures must be guaranteed by an "eligible guarantor institution"
(such as a bank, stockbroker, credit union or savings association) pursuant to
Rule 17Ad-15 of the Rules and Regulations of the Securities Exchange Act of
1934.

                                      B-5
<PAGE>   46

             FORM OF REVERSE SIDE OF RIGHT CERTIFICATE -- CONTINUED

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

         The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and that
after due inquiry and to the best of the knowledge of the undersigned, it did
not acquire the Rights evidenced by this Rights Certificate for any Person who
is, was or subsequently became an Acquiring Person or an Affiliate or Associate
of such Person.

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

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

                                     NOTICE

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

         In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of
the Rights evidenced by this Right Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.

                                      B-6
<PAGE>   47
                                   EXHIBIT C

                 SUMMARY OF RIGHTS TO PURCHASE PREFERRED SHARES

         On September 17, 2001, the Board of Directors of BindView Development
Corporation (the "Company") declared a dividend of one Preferred Share purchase
right (a "Right") for each outstanding share of common stock, no par value per
share (the "Common Shares"), of the Company and authorized the issuance of one
Right for each Common Share which shall become outstanding between the Record
Date and the earlier of the Distribution Date (as hereinafter defined) or the
Final Expiration Date of the Rights (as hereinafter defined). The dividend is
payable on September 21, 2001 (the "Record Date") to the shareholders of record
on that date. Each Right entitles the registered holder to purchase from the
Company one share of Series A Preferred Stock, par value $.01 per share (the
"Preferred Shares"), of the Company at a price of $11.00 per one one-hundredth
interest in a Preferred Share (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") between the Company and Mellon Investor Services LLC (the
"Rights Agent").

         Until the earlier to occur of (i) ten business days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") have acquired beneficial ownership of 15% or more of the
outstanding Common Shares and (ii) ten business days following the commencement
of, or announcement of an intention to make, a tender offer or exchange offer
the consummation of which would result in the beneficial ownership by a person
or group of 15% or more of such outstanding Common Shares (the earlier of such
dates being called the "Distribution Date"), the Rights will be evidenced, with
respect to any Common Share certificate outstanding as of the Record Date, by
such Common Share certificate together with a copy of this Summary of Rights
attached thereto. The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the Common Shares.

         Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights), new Common Share certificates issued after the Record
Date, upon transfer or new issuance of Common Shares will contain a notation
incorporating the Rights Agreement by reference.

         Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights), the surrender for transfer of any certificates for
Common Shares outstanding as of the Record Date, even without such notation or
copy of this Summary of Rights being attached thereto, will also constitute the
transfer of the Rights associated with the Common Shares represented by such
certificate. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Shares as of the Close of Business on the
Distribution Date and such separate Right Certificates alone will evidence the
Rights.

         The Rights are not exercisable until the Distribution Date. The Rights
will expire on September 17, 2011 (the "Final Expiration Date"), unless the
Final Expiration Date is extended

                                      C-1
<PAGE>   48

or unless the Rights are earlier redeemed or exchanged by the Company, in each
case, as described below.

         The Purchase Price payable, and the number of interests in Preferred
Shares or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights, options or warrants to subscribe for or purchase Preferred
Shares at a price, or securities convertible into Preferred Shares with a
conversion price, less than the then current market price of the Preferred
Shares or (iii) upon the distribution to holders of the Preferred Shares of
evidences of indebtedness or assets (excluding regular periodic cash dividends
paid out of earnings or retained earnings or dividends payable in Preferred
Shares) or of subscription rights or warrants (other than those referred to
above).

         The number of outstanding Rights and the number of one one-hundredth
interests in a Preferred Share issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Preferred Shares or a
stock dividend on the Preferred Shares payable in Preferred Shares or
subdivisions, consolidations or combinations of the Preferred Shares occurring,
in any such case, prior to the Distribution Date.

         Interests in Preferred Shares purchasable upon exercise of the Rights
will not be redeemable. Each Preferred Share will be entitled to a minimum
preferential quarterly dividend payment of $0.10 per share but will be entitled
to an aggregate dividend of 100 times the dividend declared per Common Share. In
the event of a liquidation, the holders of the interests in Preferred Shares
will be entitled to a minimum preferential liquidation payment of $10 per share
but will be entitled to an aggregate payment of 100 times the payment made per
Common Share. Each Preferred Share will have 100 votes, voting together with the
Common Shares. Finally, in the event of any merger, consolidation or other
transaction in which Common Shares are exchanged, each Preferred Share will be
entitled to receive 100 times the amount received per Common Share. These rights
are protected by customary antidilution provisions.

         Because of the nature of the Preferred Shares' dividend, liquidation
and voting rights, the value of the one one-hundredth interest in a Preferred
Share purchasable upon exercise of each Right should approximate the value of
one Common Share.

         In the event the Company is, in effect, acquired in a merger or other
business combination transaction or 50% or more of its consolidated assets or
earning power is sold, proper provision will be made so that each holder of a
Right will thereafter generally have the right to receive, upon the exercise
thereof at the then current exercise price of the Right, that number of shares
of common stock of the acquiring company which at the time of such transaction
will have a market value of two times the exercise price of the Right. In the
event any person becomes an Acquiring Person, proper provision shall be made so
that each holder of a Right, other than Rights beneficially owned by the
Acquiring Person (which will thereafter be null and void for all purposes of the
Rights Agreement and the holder thereof shall thereafter have no rights with
respect to such Rights, whether under the Rights Agreement or otherwise), will
thereafter have the right to receive upon exercise that number of Preferred
Shares having a market value of two times the exercise price of the Right. Under
some circumstances, in lieu of

                                      C-2
<PAGE>   49

Preferred Shares, other equity and debt securities, property, cash or
combinations thereof, including combinations with Preferred Shares, may be
issued upon payment of the exercise price if of equal value to the number of
Preferred Shares for which the Right is exercisable.

         Under certain circumstances, after a Person has become an Acquiring
Person, the Board of Directors of the Company may exchange the Rights (other
than Rights that were or are beneficially owned by an Acquiring Person), in
whole or in part, at an exchange ratio of one Preferred Share per Right (subject
to adjustment).

         With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional Preferred Shares (other than fractions which
are integral multiples of one one-hundredth of a Preferred Share, which may, at
the election of the Company be evidenced by depositary receipts) will be issued,
and in lieu thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day prior to the date of
exercise.

         At any time prior to the Close of Business on the tenth business day
after the first date of public announcement by the Company or an Acquiring
Person that an Acquiring Person has become such (a "Shares Acquisition Date"),
the Board of Directors of the Company may redeem the Rights in whole, but not in
part, at a price of $.001 per right (the "Redemption Price"), which may be paid
in cash or with Preferred Shares or other consideration deemed appropriate by
the Board of Directors of the Company. Immediately upon any redemption of the
Rights, the right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.

         Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.

         The terms of the Rights may be amended by the Board of Directors of the
Company without the consent of the holders of the Rights at any time to cure any
ambiguity or to correct or supplement any defective or inconsistent provisions
and may, prior to the Distribution Date, be amended to change or supplement any
other provision in any manner which the Company may deem necessary or desirable.
After the Distribution Date, the terms of the Rights may be amended (other than
to cure ambiguities or correct or supplement defective or inconsistent
provisions) only so long as such amendment shall not adversely affect the
interests of the holders of the Rights (which may not be an Acquiring Person in
whose hands Rights are void).

         A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated
September [ ], 2001. A copy of the Rights Agreement is available free of charge
from the Company. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is hereby incorporated herein by reference.

                                      C-3

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