Document:

exv4w1

 

EXHIBIT 4.1

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

and

EQUISERVE TRUST COMPANY, N.A.

as Rights Agent

Rights Agreement

Dated as of September 15, 2003

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	 	 	
	 
	Section 1. Certain Definitions	 	 	
1	 
	 	 	 	 	 
	Section 2. Appointment of Rights Agent	 	 	
5	 
	 	 	 	 	 
	Section 3. Issuance of Right Certificates	 	 	
5	 
	 	 	 	 	 
	Section 4. Form of Right Certificates	 	 	
7	 
	 	 	 	 	 
	Section 5. Countersignature and Registration	 	 	
7	 
	 	 	 	 	 
	Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates	 	 	
7	 
	 	 	 	 	 
	Section 7. Exercise of Rights, Purchase Price; Expiration Date of Rights	 	 	
8	 
	 	 	 	 	 
	Section 8. Cancellation and Destruction of Right Certificates	 	 	
9	 
	 	 	 	 	 
	Section 9. Availability of Shares of Preferred Stock	 	 	
10	 
	 	 	 	 	 
	Section 10. Preferred Stock Record Date	 	 	
11	 
	 	 	 	 	 
	Section 11. Adjustment of Purchase Price, Number and Kind of Shares and Number of
Rights	 	 	
11	 
	 	 	 	 	 
	Section 12. Certificate of Adjusted Purchase Price or Number of Shares	 	 	
18	 
	 	 	 	 	 
	Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earnings Power	 	 	
19	 
	 	 	 	 	 
	Section 14. Fractional Rights and Fractional Shares	 	 	
22	 
	 	 	 	 	 
	Section 15. Rights of Action	 	 	
23	 
	 	 	 	 	 
	Section 16. Agreement of Right Holders	 	 	
24	 
	 	 	 	 	 
	Section 17. Right Certificate Holder Not Deemed a Stockholder	 	 	
24	 
	 	 	 	 	 
	Section 18. Concerning the Rights Agent	 	 	
24	 
	 	 	 	 	 
	Section 19. Merger or Consolidation or Change of Name of Rights Agent	 	 	
25	 
	 	 	 	 	 
	Section 20. Duties of Rights Agent	 	 	
25	 
	 	 	 	 	 
	Section 21. Change of Rights Agent	 	 	
27	 
	 	 	 	 	 
	Section 22. Issuance of New Right Certificates	 	 	
28	 

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	 	 	Page	 
	 	 	
	 
	Section 23. Redemption and Termination	 	 	
28	 
	 	 	 	 	 
	Section 24. Exchange	 	 	
29	 
	 	 	 	 	 
	Section 25. Notice of Certain Events	 	 	
30	 
	 	 	 	 	 
	Section 26. Notices	 	 	
31	 
	 	 	 	 	 
	Section 27. Supplements and Amendments	 	 	
31	 
	 	 	 	 	 
	Section 28. Successors	 	 	
32	 
	 	 	 	 	 
	Section 29. Benefits of this Rights Agreement	 	 	
32	 
	 	 	 	 	 
	Section 30. Determinations and Actions by the Board of Directors	 	 	
32	 
	 	 	 	 	 
	Section 31. Severability	 	 	
32	 
	 	 	 	 	 
	Section 32. Governing Law	 	 	
32	 
	 	 	 	 	 
	Section 33. Counterparts	 	 	
33	 
	 	 	 	 	 
	Section 34. Descriptive Headings	 	 	
33	 

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INDEX OF DEFINED TERMS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Page	 	 	 	 	Page	 
	Acquiring Person	 	 	
1	 	 	Original Rights
	 	 	3	 
	Affiliate	 	 	
2	 	 	Person
	 	 	4	 
	Associate	 	 	
2	 	 	Preferred Stock
	 	 	4	 
	Authorized Officer	 	 	
26	 	 	Principal Party
	 	 	20	 
	Beneficial Owner	 	 	
2	 	 	Purchase Price
	 	 	8	 
	Beneficial Ownership	 	 	
2	 	 	Record Date
	 	 	1	 
	beneficially own	 	 	
2	 	 	Redemption Date
	 	 	8	 
	Business Day	 	 	
3	 	 	Redemption Price
	 	 	28	 
	close of business	 	 	
3	 	 	Right
	 	 	1	 
	Common Stock	 	 	
3	 	 	Right Certificate
	 	 	5	 
	Common Stock equivalents	 	 	
13	 	 	Rights Agent
	 	 	1	 
	Company	 	 	
1	 	 	Rights Agreement
	 	 	1	 
	Current Value	 	 	
13	 	 	Section 11(a)(ii) Trigger Date
	 	 	13	 
	Distribution Date	 	 	
5	 	 	Securities Act
	 	 	4	 
	equivalent preferred shares	 	 	
14	 	 	Security
	 	 	15	 
	Exchange Act	 	 	
2	 	 	Spread
	 	 	13	 
	Exchange Ratio	 	 	
30	 	 	Stock Acquisition Date
	 	 	4	 
	Exempt Person	 	 	
4	 	 	Subsidiary
	 	 	4	 
	Expiration Date	 	 	
8	 	 	Substitution Period
	 	 	13	 
	Final Expiration Date	 	 	
8	 	 	Summary of Rights
	 	 	5	 
	invalidation time	 	 	
12	 	 	then outstanding
	 	 	2	 
	Nasdaq	 	 	
4	 	 	TIDE Committee
	 	 	4	 
	NYSE	 	 	
4	 	 	Trading Day
	 	 	15	 

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RIGHTS AGREEMENT

          Rights Agreement, dated as of September 15, 2003 (as amended, supplemented
or otherwise modified from time to time, the “Rights Agreement”) between
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC., a Delaware corporation (the
“Company”), and EquiServe Trust Company, N.A., as Rights Agent (the “Rights
Agent”).

          The Board of Directors of the Company has on September 15, 2003 authorized
and declared a dividend of one preferred share purchase right (a “Right”) for
each share of Common Stock (as defined below) of the Company outstanding as of
the close of business (as defined below) on September 25, 2003 (the “Record
Date”), each Right representing the right to purchase one one-thousandth
(subject to adjustment) of a share of Preferred Stock (as defined below), upon
the terms and subject to the conditions herein set forth, and the Board of
Directors has further authorized and directed the issuance of one Right
(subject to adjustment as provided herein) with respect to each share of Common
Stock that shall become outstanding between the Record Date and the earlier of
the Distribution Date and the Expiration Date (as such terms are hereinafter
defined); provided, however, that Rights may be issued with respect to shares
of Common Stock that shall become outstanding after the Distribution Date and
prior to the Expiration Date in accordance with Section 22.

          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 Rights Agreement,
the following terms have the meaning indicated:

          (a) “Acquiring Person” shall mean any Person (as defined below) who or which
shall be the Beneficial Owner (as defined below) of 15% or more of the shares
of Common Stock then outstanding, but shall not include an Exempt Person (as
defined below); provided, however, that if the Board of Directors of the
Company determines in good faith that a Person who would otherwise be an
“Acquiring Person” has become such inadvertently (including, without
limitation, because (A) such Person was unaware that it beneficially owned a
percentage of Common Stock that would otherwise cause such Person to be an
“Acquiring Person” or (B) such Person was aware of the extent of its Beneficial
Ownership of Common Stock but had no actual knowledge of the consequences of
such Beneficial Ownership under this Rights Agreement) and without any
intention of changing or influencing control of the Company, then such Person
shall not be deemed to be or to have become an “Acquiring Person” for any
purposes of this Rights Agreement unless and until such Person shall have
failed to divest itself, as soon as practicable, if the Company so requests, of
Beneficial Ownership of a sufficient number of shares of Common Stock so that
such Person would no longer otherwise qualify as an “Acquiring Person”.
Notwithstanding the foregoing: (i) if as of the date hereof, any Person is the
Beneficial Owner of 15% or more of the shares of Common Stock then outstanding
such Person shall not be deemed to be or to become an “Acquiring Person” unless
and until such time as such Person shall (A) after the date hereof become the
Beneficial Owner of additional shares of Common Stock representing 2% or more of
the then-outstanding shares of Common Stock as of the date hereof (other than
pursuant to a dividend or distribution paid or made by the

 

 

Company on the outstanding Common Stock or pursuant to a split or subdivision of the outstanding Common Stock) and (B)
upon becoming the Beneficial Owner of such additional shares of Common Stock
referred to in clause (A), such Person is then the Beneficial Owner of 15% or
more of the shares of Common Stock then outstanding; and (ii) no Person shall
be deemed an “Acquiring Person” as the result of an acquisition of shares of
Common Stock by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares beneficially owned by
such Person to 15% or more of the shares of Common Stock then outstanding;
provided, however, that if a Person shall become the Beneficial Owner of 15% or
more of the shares of Common Stock then outstanding by reason of such share
acquisitions by the Company referred to in this clause (ii) and thereafter
becomes the Beneficial Owner of any additional shares of Common Stock (other
than pursuant to a dividend or distribution paid or made by the Company on the
outstanding Common Stock or pursuant to a split or subdivision of the
outstanding Common Stock), then such Person shall be deemed to be an “Acquiring
Person,” subject to the proviso set forth in the first sentence of this Section
1(a), unless upon the consummation of the acquisition of such additional shares
of Common Stock such Person does not beneficially own 15% or more of the shares
of Common Stock then outstanding. The phrase “then outstanding”, when used
with reference to a Person’s Beneficial Ownership of securities of the Company,
shall mean the number of such securities then issued and outstanding together
with the number of such securities not then actually issued and outstanding
which such Person would be deemed to own beneficially hereunder.

          (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 Rights Agreement.

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

		
	 	     (i) which such Person or any of such Person’s Affiliates or
Associates is deemed to beneficially own, directly or indirectly, within
the meaning of Rule 13d-3 of the General Rules and Regulations under the
Exchange Act as in effect on the date of this Rights Agreement;

		
	 	     (ii) which such Person or any of such Person’s Affiliates or Associates
has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (other than customary agreements with and
between underwriters and selling group members with respect to a bona fide
public offering of securities), written or otherwise, or upon the exercise
of conversion rights, exchange rights, rights (other than the Rights),
warrants or options, or otherwise; provided, however, that a Person shall
not be deemed the Beneficial Owner of, or to beneficially own, (x)
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, (y)
securities which such Person has a right to acquire on the exercise of
Rights at any time prior to the time a Person becomes an Acquiring Person
or (z) securities issuable upon
exercise of Rights from and after the time a Person becomes an
Acquiring Person if such Rights were acquired by such Person or any of
such Person’s Affiliates or Associates 

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	 	prior to the Distribution Date or
pursuant to Section 3 or Section 22 hereof (the “Original Rights”) or
pursuant to Section 11(i) or Section 11(n) with respect to an adjustment
to the Original Rights; or (B) the right to vote pursuant to any
agreement, arrangement or understanding, written or otherwise; provided,
however, that a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security by reason of such agreement, arrangement or
understanding if the agreement, arrangement or understanding to vote such
security (1) arises solely from a revocable proxy or consent given to such
Person in response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable rules and regulations
promulgated under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or successor
report); or

		
	 	     (iii) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such
Person or any of such Person’s Affiliates or Associates has any agreement,
arrangement or understanding (other than customary agreements with and
between underwriters and selling group members with respect to a bona fide
public offering of securities), written or otherwise, for the purpose of
acquiring, holding, voting (except to the extent contemplated by the
proviso to this Section 1(c)(ii)(B)) or disposing of such securities of
the Company;

provided, however, that (x) no Person who is an officer, director, or employee
of an Exempt Person shall be deemed, solely by reason of such Person’s status
or authority as such, to be the “Beneficial Owner” of, to have “Beneficial
Ownership” of or to “beneficially own” any securities that are “beneficially
owned” (as defined in this Section 1(c)), including, without limitation, in a
fiduciary capacity, by an Exempt Person or by any other such officer, director
or employee of an Exempt Person; (y) a Person shall not be deemed the
Beneficial Owner of, to have “Beneficial Ownership” of or to beneficially own,
shares of Common Stock (or securities convertible into, exchangeable into or
exercisable for Common Stock) held by such Person in trust accounts, managed
accounts and the like, or otherwise held in a fiduciary capacity, that are
Beneficially Owned by third Persons who are not Affiliates or Associates of
such Person.

          (d) “Business Day” shall mean any day other than a Saturday, a Sunday, or
a day on which banking institutions in the State of New York, or the State in
which the principal office of the Rights Agent is located, are authorized or
obligated by law or executive order to close.

          (e) “close of business” on any given date shall mean 5:00 P.M., Eastern
time, on such date; provided, however, that if such date is not a Business Day
it shall mean 5:00 P.M., Eastern time, on the next succeeding Business Day.

          (f) “Common Stock” when used with reference to the Company shall mean the
common stock, par value $.01, of the Company. “Common Stock” when used with
reference to any Person other than the Company shall mean the capital stock
(or, in the case of an unincorporated entity, the equivalent equity interest)
with the greatest voting power of such other Person or, if such other Person is
a subsidiary of another Person, the Person or Persons which ultimately control
such first-mentioned Person.

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          (g) “Exempt Person” shall mean (i) Richard E. Dauch, members of his
immediate family, any trust or other estate in which such person has a
substantial beneficial interest and any relative or spouse of such person, or
any relative of such spouse, who has the same home as such person (each, a
“Dauch Holder”), provided, however, each Dauch Holder shall cease to be an
Exempted Person in the event Richard E. Dauch ceases to be the Chief Executive
Officer of the Company (such event, a “Dauch Termination Event”) and (ii) the
Company, any Subsidiary (as defined below) of the Company, in each case
including, without limitation, in its fiduciary capacity, or any employee
benefit plan of the Company or of any Subsidiary of the Company or any entity
or trustee holding Common Stock for or pursuant to the terms of any such plan
or for the purpose of funding any such plan or funding other employee benefits
for employees of the Company or of any Subsidiary of the Company.
Notwithstanding clause (i) of this definition, a Dauch Holder shall not be
deemed to be an Acquiring Person if at the time of a Dauch Termination Event
such Person is the Beneficial Owner of 15% or more of the shares of Common
Stock then outstanding unless and until such time as such Person shall (A)
after the Dauch Termination Event become the Beneficial Owner of additional
shares of Common Stock representing 2% or more of the then-outstanding shares
of Common Stock as of the date of the Dauch Termination Event (other than
pursuant to a dividend or distribution paid or made by the Company on the
outstanding Common Stock or pursuant to a split or subdivision of the
outstanding Common Stock) and (B) upon becoming the Beneficial Owner of such
additional shares of Common Stock referred to in clause (A), such Person is
then the Beneficial Owner of 15% or more of the shares of Common Stock then
outstanding.

          (h) “Independent Director” means a member of the Board of Directors of the
Company, (i) who is not, and during the past three years has not been, an
officer or employee of the Company, and (ii) who is not (A) an Acquiring Person
or an Affiliate or Associate of an Acquiring Person or (B) a Person who shall
have made a proposal to the Company or its shareholders, or taken any other
action that, if effective, could cause such Person to become an Acquiring
Person hereunder, or an Affiliate or Associate of any such Person.

          (i) “Nasdaq” shall mean The Nasdaq Stock Market’s National Market.

          (j) “NYSE” shall mean The New York Stock Exchange.

          (k) “Person” shall mean any individual, firm, corporation, partnership,
limited liability company, trust or other entity, and shall include any
successor (by merger or otherwise) of such entity.

          (l) “Preferred Stock” shall mean the Series A Junior Participating
Preferred Stock, par value $.01 per share, of the Company having the rights and
preferences set forth in the Form of Certificate of Designations attached to
this Rights Agreement as Exhibit A.

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

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

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Person has become such or such earlier date as a majority of the Board of
Directors shall become aware of the existence of an Acquiring Person.

          (o) “Subsidiary” of any Person shall mean any corporation or other entity
of which securities or other ownership interests having ordinary voting power
sufficient to elect a majority of the board of directors or other persons
performing similar functions are beneficially owned, directly or indirectly, by
such Person, and any corporation or other entity that is otherwise controlled
by such Person.

          (p) “TIDE Committee” shall mean the committee comprised of Independent
Directors selected by the Board of Directors as set forth in Section 23 hereof.

          Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Distribution Date
also be the holders of Common Stock) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable upon ten (10) days’ prior notice to the Rights Agent.
The Rights Agent shall have no duty to supervise, and shall in no event be
liable for the acts or omissions of any such co-Rights Agent.

          Section 3. Issuance of Right Certificates. (a) Until the close of
business on the earlier of (i) the tenth day after the Stock Acquisition Date
or (ii) the tenth Business Day (or such later date as may be determined by
action of the Board of Directors prior to such time as any Person becomes an
Acquiring Person) after the date of the commencement by any Person (other than
an Exempt Person) of, or of the first public announcement of the intention of
such Person (other than an Exempt Person) to commence, a tender or exchange
offer the consummation of which would result in any Person (other than an
Exempt Person) becoming the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding (including, in the case of both clause (i) and
(ii), any such date which is after the date of this Rights Agreement and prior
to the issuance of the Rights) (the earlier of such dates being herein referred
to as the “Distribution Date”), (x) the Rights will be evidenced (subject to
the provisions of Section 3(b) hereof) by the certificates for Common Stock
registered in the names of the holders thereof, and not by separate Right
Certificates (as defined below), and (y) the Rights will be transferable only
in connection with the transfer of Common Stock. As soon as practicable after
the Distribution Date, the Company will prepare and execute, the Rights Agent
will countersign, and the Company will send or cause to be sent (and the Rights
Agent will, if requested, send) by first-class, insured, postage-prepaid mail,
to each record holder of Common Stock as of the close of business on the
Distribution Date (other than any Acquiring Person or any Associate or
Affiliate of an Acquiring Person), 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 (subject to
adjustment as provided herein) for each share of Common Stock so held. As of
and after 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 Shares of Preferred Stock, in
substantially the form of Exhibit C hereto (the “Summary of Rights”), by
first-class, postage-prepaid mail, to each

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record holder of Common Stock as of
the close of business on the Record Date (other than any Acquiring Person or
any Associate or Affiliate of any Acquiring Person), at the address of such
holder shown on the records of the Company. With respect to shares of Common
Stock outstanding as of the Record Date, until the Distribution Date, the
Rights associated with such shares will be evidenced by the share certificate
for such shares of Common Stock registered in the names of the holders thereof
together with the Summary of Rights. Until the Distribution Date (or, if
earlier, the Expiration Date), the surrender for transfer of any certificate
for Common Stock outstanding on the Record Date, with or without a copy of the
Summary of Rights, shall also constitute the transfer of the Rights associated
with the Common Stock represented thereby.

          (c) Rights shall be issued in respect of all shares of Common Stock issued
or disposed of (including, without limitation, upon disposition of Common Stock
out of treasury stock or issuance or reissuance of Common Stock out of
authorized but unissued shares) after the Record Date but prior to the earlier
of the Distribution Date and the Expiration Date, or in certain circumstances
provided in Section 22 hereof, after the Distribution Date. Certificates issued
for Common Stock (including, without limitation, upon transfer of outstanding
Common Stock, disposition of Common Stock out of treasury stock or issuance or
reissuance of Common Stock out of authorized but unissued shares) after the
Record Date but prior to the earlier of the Distribution Date and the
Expiration Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:

		
	 	This certificate also evidences and entitles the holder
hereof to certain rights as set forth in a Rights Agreement
between American Axle & Manufacturing Holdings, Inc. and
EquiServe Trust Company Inc., dated as of September 15,
2003, as the same may be amended, supplemented or otherwise
modified from time to time (the “Rights Agreement”), the
terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal executive
offices of American Axle & Manufacturing Holdings, Inc.
Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this
certificate. American Axle & Manufacturing Holdings, Inc.
will mail to the holder of this certificate a copy of the
Rights Agreement without charge after receipt of a written
request therefor. Under certain circumstances, as set
forth in the Rights Agreement, Rights owned by or
transferred to any Person who is or becomes an Acquiring
Person (as defined in the Rights Agreement) and certain
transferees thereof will become null and void and will no
longer be transferable.

With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Stock represented by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate, except as otherwise
provided herein, shall also constitute the transfer of the Rights associated
with the Common Stock represented thereby. In the event that the Company
purchases or otherwise acquires any Common Stock after the Record Date but
prior to the Distribution Date, any Rights associated

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with such Common Stock
shall be deemed cancelled and retired so that the Company shall not be entitled
to exercise any Rights associated with the shares of Common Stock which are no
longer outstanding.

          Notwithstanding this paragraph (c), the omission of a legend shall not
affect the enforceability of any part of this Rights Agreement or the rights of
any holder of the Rights.

          Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase shares and of assignment to be printed on the
reverse thereof) shall be substantially in the form set forth in Exhibit B
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Rights
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 NYSE
or of any other stock exchange or automated quotation system on which the
Rights may from time to time be listed, or to conform to usage. Subject to the
provisions of Sections 11 and 22 hereof, the Right Certificates shall entitle
the holders thereof to purchase such number of one one-thousandths of a share
of Preferred Stock as shall be set forth therein at the Purchase Price (as
determined pursuant to Section 7), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase Price thereof
shall be subject to adjustment as provided herein.

          Section 5. Countersignature and Registration. (a) The Right Certificates
shall be executed on behalf of the Company by the Chief Executive Officer, the
President, any of the Vice Presidents or the Treasurer of the Company, 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 countersigned by the Rights Agent, either
manually or by facsimile signature, 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 Rights
Agreement any such Person was not such an officer.

          (b) Following the Distribution Date, the Rights Agent will keep or cause to be
kept, at an office or agency 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. (a)
Subject to the provisions of this Rights Agreement, at any time after the close
of business on the Distribution Date, and prior to 

-7-

 

the close of business on the Expiration Date, any Right Certificate or Right Certificates 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-thousandths of a share of Preferred Stock (or, following such time,
other securities, cash or assets as the case may be) 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 surrender the Right Certificate or Right
Certificates to be transferred, split up, combined or exchanged at the office
or agency of the Rights Agent designated for such purpose. Thereupon the
Rights Agent, subject to the provisions of this Rights Agreement, 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.

          (b) Subject to the provisions of this Rights Agreement, at any time after
the Distribution Date and prior to the Expiration Date, upon receipt by the
Company and the Rights Agent of evidence reasonably 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) Except as otherwise provided herein, the Rights shall become exercisable
on the Distribution Date, and thereafter the registered holder of any Right
Certificate may, subject to Section 11(a)(ii) hereof and except as otherwise
provided herein, exercise the Rights evidenced thereby in whole or in part upon
surrender of the Right Certificate, with the form of election to purchase on
the reverse side thereof duly executed, to the Rights Agent at the office or
agency of the Rights Agent designated for such purpose, together with payment
of the Purchase Price for each one one-thousandth of a share of Preferred Stock
(or other securities, cash or assets, as the case may be) as to which the
Rights are exercised, at any time which is both after the Distribution Date and
prior to the time (the “Expiration Date”) that is the earliest of (i) the close
of business on September 15, 2013 (the “Final Expiration Date”), (ii) the
time at which the Rights are redeemed as provided in Section 23 hereof (the
“Redemption Date”) or (iii) the time at which such Rights are exchanged as
provided in Section 24 hereof.

          (b) The purchase price (the “Purchase Price”) shall be initially $120.00
for each one one-thousandth of a share of Preferred Stock purchasable upon the
exercise of a Right. The Purchase Price and the number of one one-thousandths
of a share of Preferred Stock or other securities or property to be acquired
upon exercise of a Right 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) of this Section
7.

-8-

 

          (c) Except as otherwise provided herein, upon receipt of a Right
Certificate representing exercisable Rights, with the form of election to
purchase duly executed, accompanied by payment of the aggregate Purchase Price
for the number of shares of Preferred Stock to be purchased and an amount equal
to any applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 6 hereof, in cash or 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 Stock certificates for the number of shares of Preferred Stock to
be purchased (and the Company hereby irrevocably authorizes its transfer agent
to comply with all such requests), or (B) requisition from the depositary agent
appointed by the Company depositary receipts representing interests in such
number of one one-thousandths of a share of Preferred Stock as are to be
purchased, in which case certificates for the Preferred Stock represented by
such receipts shall be deposited by the transfer agent with the depositary
agent (and the Company hereby directs the depositary agent to comply with such
request), (ii) when appropriate, requisition from the Company the amount of
cash to be paid in lieu of issuance of fractional shares in accordance with
Section 14 hereof, (iii) promptly 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 (iv) when appropriate, after receipt,
promptly deliver such cash to or upon the order of the registered holder of
such Right Certificate.

          (d) Except as otherwise provided herein, 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
exercisable Rights remaining unexercised shall be issued by the Rights Agent to
the registered holder of such Right Certificate or to his duly authorized
assigns, subject to the provisions of Section 14 hereof.

          (e) Notwithstanding anything in this Rights Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of Rights upon the occurrence of any
purported transfer or exercise of Rights pursuant to Section 6 hereof or this
Section 7 unless such registered holder shall have (i) completed and signed the
certificate contained in the form of assignment or election to purchase set
forth on the reverse side of the Right Certificate surrendered for such
transfer or exercise and (ii) provided such additional evidence of the identity
of the Beneficial Owner (or former Beneficial Owner) thereof as the Company
shall reasonably request.

          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 cancelled form, or,
if surrendered to the Rights Agent, shall be cancelled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to
the Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all cancelled Right Certificates to the Company, or shall, at the
written request of the Company, destroy or cause to be destroyed such cancelled
Right Certificates, and in such case shall deliver a certificate of destruction
thereof to the Company.

-9-

 

          Section 9. Availability of Shares of Preferred Stock. (a) The Company
covenants and agrees that it will cause to be reserved and kept available out
of its authorized and unissued shares of Preferred Stock or any shares of
Preferred Stock held in its treasury, the number of shares of Preferred Stock
that will be sufficient to permit the exercise in full of all outstanding
Rights.

          (b) So long as the shares of Preferred Stock (and, following the time that
a Person becomes an Acquiring Person, shares of Common Stock and other
securities) issuable upon the exercise of Rights may be listed or admitted to
trading on NYSE or listed on any other national securities exchange or
quotation system, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable, all shares reserved for such
issuance to be listed or admitted to trading on NYSE or listed on any other
exchange or quotation system upon official notice of issuance upon such
exercise.

          (c) From and after such time as the Rights become exercisable, the Company
shall use its best efforts, if then necessary to permit the issuance of shares
of Preferred Stock (and following the time that a Person first becomes an
Acquiring Person, shares of Common Stock and other securities) upon the
exercise of Rights, to register and qualify such shares of Preferred Stock (and
following the time that a Person first becomes an Acquiring Person, shares of
Common Stock and other securities) under the Securities Act and any applicable
state securities or “Blue Sky” laws (to the extent exemptions therefrom are not
available), cause such registration statement and qualifications to become
effective as soon as possible after such filing and keep such registration and
qualifications effective until the earlier of (x) the date as of which the
Rights are no longer exercisable for such securities and (y) the Expiration
Date. The Company may temporarily suspend, for a period of time not to exceed
ninety (90) days, the exercisability of the Rights in order to prepare and file
a registration statement under the Securities Act and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is
no longer in effect. Notwithstanding any provision of this Rights Agreement to
the contrary, the Rights shall not be exercisable in any jurisdiction unless
the requisite qualification or exemption in such jurisdiction shall have been
obtained and until a registration statement under the Securities Act (if
required) shall have been declared effective.

          (d) The Company covenants and agrees that it will take all such action as may
be necessary to ensure that all shares of Preferred Stock (and, following the
time that a Person becomes an Acquiring Person, shares of Common Stock and other securities)
delivered upon exercise of Rights shall, at the time of delivery of the
certificates therefor (subject to payment of the Purchase Price), be duly and
validly authorized and issued and fully paid and nonassessable shares.

          (e) The Company further covenants and agrees that it will pay when due and
payable any and all federal and state transfer taxes and charges which may be
payable in respect of the issuance or delivery of the Right Certificates or of
any shares of Preferred Stock (or shares of Common Stock or other securities)
upon the exercise of Rights. The Company shall not, however, be required to
pay any transfer 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 

-10-

 

certificates or depositary receipts for the Preferred Stock (or
shares of Common Stock or other securities) in a name other than that of, the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise or to issue or deliver any certificates or depositary receipts for
Preferred Stock (or shares of Common Stock or other securities) upon the
exercise of any Rights until any such tax or charge shall have been paid (any
such tax or charge being payable by that holder of such Right Certificate 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.

          Section 10. Preferred Stock Record Date. Each Person in whose name any
certificate for Preferred Stock is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the shares of
Preferred Stock 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 transfer
taxes or charges) was made; provided, however, that if the date of such
surrender and payment is a date upon which the Preferred Stock transfer books
of the Company are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall be dated, the next
succeeding Business Day on which such transfer books are open. Prior to the
exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a holder of Preferred Stock for which
the Rights shall be exercisable, including, without limitation, the right to
vote or to receive dividends or other distributions, and shall not be entitled
to receive any notice of any proceedings of the Company, except as provided
herein.

          Section 11. Adjustment of Purchase Price, Number and Kind of Shares and
Number of Rights. The Purchase Price, the number of shares of Preferred Stock
or other securities or property purchasable upon exercise of each Right and the
number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.

          (a) (i) In the event the Company shall at any time after the date of this
Agreement (A) declare a dividend on the Preferred Stock payable in shares of
Preferred Stock, (B) subdivide the outstanding shares of Preferred Stock, (C)
combine the outstanding shares of Preferred Stock into a smaller number of
shares of Preferred Stock or (D) issue any shares of its capital stock in a
reclassification of the shares of Preferred Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such subdivision,
combination or reclassification, as the case may be, and the number and kind of
shares of capital stock 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
which, if such Right had been exercised immediately prior to such date and at a
time when the Preferred Stock transfer books of the Company were open, the
holder would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of one Right.

		
	 	     (ii) Subject to Section 24 of this Rights Agreement and except as otherwise
provided in this Section 11(a)(ii) and Section 11(a)(iii), in the event
that any Person 

-11-

 

		
	 	becomes an Acquiring Person, each holder of a Right shall
thereafter have the right to receive, upon exercise thereof at a price
equal to the then-current Purchase Price, in accordance with the terms of
this Rights Agreement and in lieu of shares of Preferred Stock, such
number of shares of Common Stock (or at the option of the Company, such
number of one one-thousandths of a share of Preferred Stock) as shall
equal the result obtained by (x) multiplying the then-current Purchase
Price by the number of one one-thousandths of a share of Preferred Stock
for which a Right is then exercisable and dividing that product by (y) 50%
of the then-current per share market price of the Company’s Common Stock
(determined pursuant to Section 11(d) hereof) on the date of the
occurrence of such event; provided, however, that the Purchase Price (as
so adjusted) and the number of shares of Common Stock so receivable upon
exercise of a Right shall thereafter be subject to further adjustment as
appropriate in accordance with Section 11(f) hereof. Notwithstanding
anything in this Rights Agreement to the contrary, however, from and after
the time (the “invalidation time”) when any Person first becomes an
Acquiring Person, any Rights that are beneficially owned by (x) any
Acquiring Person (or any Affiliate or Associate of any Acquiring Person),
(y) a transferee of any Acquiring Person (or any such Affiliate or
Associate) who becomes a transferee after the invalidation time or (z) a
transferee of any Acquiring Person (or any such Affiliate or Associate)
who became a transferee prior to or concurrently with the invalidation
time pursuant to either (I) a transfer from the Acquiring Person to
holders of its equity securities or to any Person with whom it has any
continuing agreement, arrangement or understanding, written or otherwise,
regarding the transferred Rights or (II) a transfer that the Board of
Directors has determined is part of a plan, arrangement or understanding,
written or otherwise, which has the purpose or effect of avoiding the
provisions of this paragraph, and subsequent transferees of such Persons,
shall be void without any further action and any holder of such Rights
shall thereafter have no rights whatsoever with respect to such Rights
under any provision of this Rights Agreement. The Company shall use all
reasonable efforts to ensure that the provisions of this Section 11(a)(ii)
are complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its Affiliates,
Associates or transferees hereunder. From and after the invalidation
time, no Right Certificate shall be issued pursuant to Section 3 or
Section 6 hereof that represents Rights that are or have become void pursuant
to the provisions of this paragraph, and any Right Certificate delivered
to the Rights Agent that represents Rights that are or have become void
pursuant to the provisions of this paragraph shall be cancelled. From and
after the occurrence of an event specified in Section 13(a) hereof, any
Rights that theretofore have not been exercised pursuant to this Section
11(a)(ii)
 shall thereafter be exercisable only in accordance with Section
13 and not pursuant to this Section 11(a)(ii).

		
	 	     (iii) The Company may at its option substitute for a share of Common Stock
issuable upon the exercise of Rights in accordance with the foregoing
subparagraph (ii) such number or fractions of shares of Preferred Stock
having an aggregate current market value equal to the current per share
market price of a share of Common Stock. In the event that there shall
not be sufficient shares of Common Stock issued but not outstanding or
authorized but unissued (and unreserved) to permit the exercise in full of
the Rights in accordance with the foregoing subparagraph (ii), the Board
of Directors

-12-

 

		
	 	shall, with respect to such deficiency, to the extent
permitted by applicable law and any material agreements then in effect to
which the Company is a party (A) determine the excess of (x) the value of
the shares of Common Stock issuable upon the exercise of a Right in
accordance with the foregoing subparagraph (ii) (the “Current Value”) over
(y) the then-current Purchase Price multiplied by the number of one
one-thousandths of shares of Preferred Stock for which a Right was
exercisable immediately prior to the time that the Acquiring Person became
such (such excess, the “Spread”), and (B) with respect to each Right
(other than Rights which have become void pursuant to Section 11(a)(ii)),
make adequate provision to substitute for the shares of Common Stock
issuable in accordance with subparagraph (ii) upon exercise of the Right
and payment of the applicable Purchase Price, (1) cash, (2) a reduction in
such Purchase Price, (3) shares of Preferred Stock or other equity
securities of the Company (including, without limitation, shares or
fractions of shares of preferred stock which, by virtue of having
dividend, voting and liquidation rights substantially comparable to those
of the shares of Common Stock, are deemed in good faith by the Board of
Directors to have substantially the same value as the shares of Common
Stock (such shares of preferred stock and shares or fractions of shares of
preferred stock are hereinafter referred to as “Common Stock
equivalents”)), (4) debt securities of the Company, (5) other assets or
(6) any combination of the foregoing, having a value which, when added to
the value of the shares of Common Stock actually issued upon exercise of
such Right, shall have an aggregate value equal to the Current Value (less
the amount of any reduction in such Purchase Price), where such aggregate
value has been determined by the Board of Directors upon the advice of a
nationally recognized investment banking firm selected in good faith by
the Board of Directors; provided, however, if the Company shall not make
adequate provision to deliver value pursuant to clause (B) above within
thirty (30) days following the date that the Acquiring Person became such
(the “Section 11(a)(ii) Trigger Date”), then the Company shall be
obligated to deliver, to the extent permitted by applicable law and any
material agreements then in effect to which the Company is a party, upon
the surrender for exercise of a Right and without requiring payment of the
Purchase Price, shares of Common Stock (to the extent available), and
then, if necessary, such number or fractions of shares of Preferred Stock
(to the extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the Spread. If
within the thirty (30) day period referred to above the Board of
Directors shall determine in good faith that it is likely that sufficient
additional shares of Common Stock could be authorized for issuance upon
exercise in full of the Rights, then, if the Board of Directors so elects,
such thirty (30) day period may be extended to the extent necessary, but
not more than ninety (90) days after the Section 11(a)(ii) Trigger Date,
in order that the Company may seek stockholder approval for the
authorization of such additional shares (such thirty (30) day period, as
it may be extended, is hereinafter called the “Substitution Period”). To
the extent that the Company determines that some action need be taken
pursuant to the second and/or third sentence of this Section 11(a)(iii),
the Company (x) shall provide, subject to Section 11(a)(ii) hereof and the
last sentence of this Section 11(a)(iii) hereof, that such action shall
apply uniformly to all outstanding Rights and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution
Period in order to seek any authorization of additional shares and/or to
decide the appropriate form of distribution to be made pursuant to such
second sentence and to 

-13-

 

		
	 	determine the value thereof. In the event of any
such suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is no longer
in effect. For purposes of this Section 11(a)(iii), the value of the
shares of Common Stock shall be the current per share market price (as
determined pursuant to Section 11(d)(i)) on the Section 11(a)(ii) Trigger
Date and the per share or fractional value of any Common Stock equivalent
shall be deemed to equal the current per share market price of the Common
Stock. The Board of Directors of the Company may, but shall not be
required to, establish procedures to allocate the right to receive shares
of Common Stock upon the exercise of the Rights among holders of Rights
pursuant to this Section 11(a)(iii).

          (b) In case the Company shall fix a record date for the issuance of rights,
options or warrants to all holders of Preferred Stock entitling them (for a
period expiring within 45 calendar days after such record date) to subscribe
for or purchase Preferred Stock (or shares having similar rights, privileges
and preferences as the Preferred Stock (“equivalent preferred shares”)) or
securities convertible into Preferred Stock or equivalent preferred shares at a
price per share of Preferred Stock or equivalent preferred shares (or having a
conversion price per share, if a security convertible into shares of Preferred
Stock or equivalent preferred shares) less than the then-current per share
market price of the Preferred Stock (determined pursuant to Section 11(d)
hereof) on such record date, the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Preferred Stock and equivalent preferred
shares outstanding on such record date plus the number of shares of Preferred
Stock and equivalent preferred shares which the aggregate offering price of the
total number of such 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 shares of Preferred Stock and equivalent preferred shares outstanding on
such record date plus the number of additional shares of Preferred Stock 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);
provided, however, that in no event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of one Right. In
case such subscription price may be paid in a consideration part or all of
which shall be in a form other than cash, the value of such consideration shall
be as determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and
which shall be binding on the Rights Agent. Shares of Preferred Stock and
equivalent 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
adjustment shall be made successively whenever such a record date is fixed; and
in the event that such rights, options or warrants are not so issued, the
Purchase Price shall be adjusted to be the Purchase Price 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 Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of
indebtedness or assets (other than a regular quarterly cash dividend or a
dividend

-14-

 

payable in Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by a fraction,
the numerator of which shall be the then-current per share market price of the
Preferred Stock (determined pursuant to Section 11(d) hereof) on such record
date, less the fair market value (as determined in good faith by the Board of
Directors of the Company whose determination shall be described in a statement
filed with the Rights Agent and shall be binding on the Rights Agent) of the
portion of such assets or evidences of indebtedness so to be distributed or of
such subscription rights or warrants applicable to one share of Preferred
Stock, and the denominator of which shall be such current per share market
price of the Preferred Stock; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less than the
aggregate par value of the shares of capital stock of the Company to be issued
upon exercise of one Right. Such adjustments shall be made successively
whenever such a record date is fixed; and in the event that such distribution
is not so made, the 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) Except as otherwise provided herein, 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 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 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 price shall be appropriately
adjusted to reflect the current market price per share equivalent of such
Security. The closing price for each day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either case as reported by (w)
the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on NYSE or, (x) if the Security is not
listed or admitted to trading on the NYSE, 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 (y) the Security is 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, (z) if on any such
date the Security is not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in the Security selected by the Board of Directors of the Company.
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.

-15-

 

		
	 	     (ii) For the purpose of any computation hereunder, if the Preferred
Stock is publicly traded, the “current per share market price” of the
Preferred Stock shall be determined in accordance with the method set
forth in Section 11(d)(i). If the Preferred Stock is not publicly traded
but the Common Stock is publicly traded, the “current per share market
price” of the Preferred Stock shall be conclusively deemed to be the
current per share market price of the Common Stock, as determined pursuant
to Section 11(d)(i), multiplied by one thousand (appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring
after the date hereof). If neither the Common Stock nor the Preferred
Stock is publicly traded, “current per share market price” shall mean the
fair value per share as determined in good faith by the Board of Directors
of the Company, whose determination shall be described in a statement
filed with the Rights Agent and shall be binding on 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 not required to be made by
reason of this Section 11(e) 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-thousandth of a share of
Preferred Stock or share of Common Stock or 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 Expiration Date.

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

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

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

-16-

 

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 pursuant to Sections 11(b) or 11(c) hereof to adjust the number
of Rights, in substitution for any adjustment in the number of one
one-thousandths of a share of Preferred Stock purchasable upon the exercise of
a Right. Each of the Rights outstanding after such adjustment of the number of
Rights shall be exercisable for the number of one one-thousandths of a share of
Preferred Stock for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number
of Rights shall become that number of Rights (calculated to the nearest one
ten-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall make a
public announcement of its election to adjust the number of Rights, indicating
the record date for the adjustment, and, if known at the time, the amount of
the adjustment to be made. This record date may be the date on which the
Purchase Price is adjusted or any day thereafter, but, if the 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
may, 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 surrender thereof, if required by the Company, new
Right Certificates evidencing all the Rights to which such holders shall be
entitled as a result of 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-thousandths of a share of Preferred Stock 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-thousandths of a share of Preferred Stock 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 the then par value, if any, of the shares of Preferred
Stock or other shares of capital stock issuable upon exercise of the Rights,
the Company shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue
fully paid and nonassessable shares of Preferred Stock or other such 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 until the occurrence of such event the
issuing to the holder of any Right exercised after such record date the
Preferred Stock, Common Stock or other capital stock or securities of

-17-

 

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

          (n) Notwithstanding anything in this Rights Agreement to the contrary, in
the event that at any time after the date of this Rights Agreement and prior to
the Distribution Date, the Company shall (i) declare or pay any dividend on the
Common Stock payable in Common Stock or (ii) effect a subdivision, combination
or consolidation of the Common Stock (by reclassification or otherwise than by
payment of a dividend payable in Common Stock) into a greater or lesser number
of shares of Common Stock, then in any such case, the number of Rights
associated with each share of Common Stock then outstanding, or issued or
delivered thereafter, shall be proportionately adjusted so that the number of
Rights thereafter associated with each share of Common Stock following any such
event shall equal the result obtained by multiplying the number of Rights
associated with each share of Common Stock immediately prior to such event by a
fraction the numerator of which shall be the total number of shares of Common
Stock outstanding immediately prior to the occurrence of the event and the
denominator of which shall be the total number of shares of Common Stock
outstanding immediately following the occurrence of such event.

          (o) The Company agrees that, after the earlier of the Distribution Date or the
Stock Acquisition Date, it will not, except as permitted by Sections 23, 24 or
27 hereof, take (or permit any Subsidiary to take) any action if at the time
such action is taken it is reasonably
foreseeable that such action will diminish substantially or 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 Section 11 or 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) file
with the Rights Agent and with each transfer agent for the Common Stock or the
Preferred Stock a copy of such certificate and (c) mail a brief summary thereof
to each holder of a Right Certificate in accordance with Section 25 hereof (if
so required under Section 25 hereof). The Rights Agent shall be fully
protected in relying on any such

-18-

 

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

          Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earnings Power. (a) In the event, directly or indirectly, at any time after
any Person has become an Acquiring Person, (i) the Company shall merge with and
into any other Person, (ii) any Person shall consolidate with the Company, or
any Person shall merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in connection with such
merger, all or part of the Common Stock shall be changed into or exchanged for
stock or other securities of any other Person (or of 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 to 50% or more of the
assets or earning power of the Company and its Subsidiaries (taken as a whole)
to any other Person (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:

          (A) each holder of record of a Right (other than Rights which have become void
pursuant to Section 11(a)(ii)) 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-thousandths of a share of Preferred Stock
for which a Right was exercisable (whether or not such Right was then
exercisable) immediately prior to the time that any Person first became an
Acquiring Person (each as subsequently adjusted thereafter pursuant to Section
11(a)(i), 11(b), 11(c), 11(h), 11(i) and 11(m)), in accordance with the terms
of this Rights Agreement and in lieu of Preferred Stock, such number of validly
issued, fully paid and non-assessable and freely tradeable shares of Common
Stock of the Principal Party (as defined below) not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as shall be
equal to the result obtained by (1) multiplying the then-current Purchase Price
by the number of one one-thousandths of a share of Preferred Stock for which a
Right was exercisable immediately prior to the time that any Person first
became an Acquiring Person (as subsequently adjusted thereafter pursuant to
Section 11(a)(i), 11(b), 11(c), 11(h), 11(i) and 11(m)) and (2) dividing that
product by 50% of the then-current per share market price of the Common Stock
of such Principal Party (determined pursuant to Section 11(d)(i) hereof) on the
date of consummation of such consolidation, merger, sale or transfer; provided
that the Purchase Price and the number of shares of Common Stock of such
Principal Party issuable upon exercise of each Right shall be
further adjusted as provided in Section 11(f) of this Rights Agreement to
reflect any events occurring in respect of such Principal Party after the date
of such consolidation, merger, sale or transfer;

          (B) such Principal Party shall thereafter be liable for, and shall assume,
by virtue of such consolidation, merger, sale or transfer, all the obligations
and duties of the Company pursuant to this Rights Agreement;

          (C) the term “Company” shall thereafter be deemed to refer to such
Principal Party; and

          (D) such Principal Party shall take such steps (including, but not limited
to, the reservation of a sufficient number of its shares of its Common Stock)
in connection with such

-19-

 

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

          (b) “Principal Party” shall mean:

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

		
	 	     (ii) in the case of any transaction described in (iii) of the first
sentence in Section 13(a) hereof, the Person that is the party receiving
the greatest portion of the assets or earning power transferred pursuant
to such transaction or transactions, or, if each Person that is a party to
such transaction or transactions receives the same portion of the assets
or earning power so transferred or if the Person receiving the greatest
portion of the assets or earning power cannot be determined, whichever of
such Persons is the issuer of Common Stock having the greatest aggregate market value of
shares outstanding;

provided, however, that in any such case described in the foregoing clause
(b)(i) or (b)(ii), if the Common Stock of such Person is not at such time or
has not been continuously over the preceding 12-month period registered under
Section 12 of the Exchange Act, then (1) if such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has been so
registered, the term “Principal Party” shall refer to such other Person, or (2)
if such Person is a Subsidiary, directly or indirectly, of more than one
Person, and the Common Stocks of all of such persons have been so registered,
the term “Principal Party” shall refer to whichever of such Persons is the
issuer of Common Stock having the greatest aggregate market value of shares
outstanding, or (3) if such Person is owned, directly or indirectly, by a joint
venture formed by two or more Persons that are not owned, directly or
indirectly, by the same Person, the

-20-

 

rules set forth in clauses (1) and (2)
above shall apply to each of the owners having an interest in the venture as if
the Person owned by the joint venture was a Subsidiary of both or all of such
joint venturers, and the Principal Party in each such case shall bear the
obligations set forth in this Section 13 in the same ratio as its interest in
such Person bears to the total of such interests.

          (c) The Company shall not consummate any consolidation, merger, sale or
transfer referred to in Section 13(a) hereof unless prior thereto the Company
and the Principal Party involved therein shall have executed and delivered to
the Rights Agent an agreement confirming that the requirements of Sections
13(a) and (b) hereof shall promptly be performed in accordance with their terms
and that such consolidation, merger, sale or transfer of assets shall not
result in a default by the Principal Party under this Rights Agreement as the
same shall have been assumed by the Principal Party pursuant to Sections 13(a)
and (b) hereof and providing that, as soon as practicable after executing such
agreement pursuant to this Section 13, the Principal Party will:

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

		
	 	     (ii) use its best efforts, if the Common Stock of the Principal Party
shall be listed or admitted to trading on NYSE or on another national
securities exchange, to list or admit to trading (or continue the listing
of) the Rights and the securities purchasable upon exercise of the Rights
on NYSE or such securities exchange, or, if the Common Stock of the
Principal Party shall not be listed or admitted to trading on NYSE or a
national securities exchange, to cause the Rights and the securities
receivable upon exercise of the Rights to be reported by such other system
then in use;

		
	 	     (iii) deliver to holders of the Rights historical financial
statements for the Principal Party which comply in all respects with the
requirements for registration on Form 10 (or any successor form) under the
Exchange Act; and

		
	 	     (iv) obtain waivers of any rights of first refusal or preemptive
rights in respect of the Common Stock of the Principal Party subject to
purchase upon exercise of outstanding Rights.

          (d) In case the Principal Party has a provision in any of its authorized
securities or in its certificate of incorporation or by-laws or other
instrument governing its affairs, which provision would have the effect of (i)
causing such Principal Party to issue (other than to holders of Rights pursuant
to this Section 13), in connection with, or as a consequence of, the
consummation of a transaction referred to in this Section 13, shares of Common
Stock or Common Stock equivalents of such Principal Party at less than the
then-current market price per share thereof (determined pursuant to Section
11(d) hereof) or securities exercisable for, or convertible into, Common Stock
or Common Stock equivalents of such Principal Party at less

-21-

 

than such then-current market price, or (ii) providing for any special payment, tax or
similar provision in connection with the issuance of the Common Stock of such
Principal Party pursuant to the provisions of Section 13, then, in such event,
the Company hereby agrees with each holder of Rights that it shall not
consummate any such transaction unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with, or as a consequence of, the consummation of
the proposed transaction.

          (e) The Company covenants and agrees that it shall not, at any time after
a Person first becomes an Acquiring Person enter into any transaction of the
type contemplated by Sections 13(a)(i)-(iii) hereof if (x) at the time of or
immediately after such consolidation, merger, sale, transfer or other
transaction there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights, (y)
prior to, simultaneously with or immediately after such consolidation, merger,
sale, transfer or other transaction, the stockholders of the Person who
constitutes, or would constitute, the Principal Party for purposes of Section
13(b) hereof shall have received a distribution of Rights previously owned by
such Person or any of its Affiliates or Associates or (z) the form or nature of
organization of the Principal Party would preclude or limit the exercisability
of the Rights.

          Section 14. Fractional Rights and Fractional Shares. (a) The Company shall
not be required to issue fractions of Rights (except prior to the Distribution
Date in accordance with Section 11(n) hereof) 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 the purposes of this Section 14(a), the current market value
of a whole Right shall be the closing price of the Rights for the Trading Day
immediately prior to the date on which such fractional Rights would have been
otherwise issuable. 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 by (w) the principal consolidated transaction reporting system with
respect to securities listed or
admitted to trading on NYSE or, (x) if the Rights are not listed or
admitted to trading on NYSE, 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, (y) 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, (z) 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.

-22-

 

          (b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock). Interests in fractions of Preferred Stock in
integral multiples of one one-thousandth of a share of Preferred Stock may, at
the election of the Company, be evidenced by depositary receipts, pursuant to
an appropriate agreement between the Company and a depositary selected by it;
provided, that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they
are entitled as beneficial owners of the Preferred Stock represented by such
depositary receipts. In lieu of fractional shares of Preferred Stock that are
not integral multiples of one one-thousandth of a share of Preferred Stock, the
Company shall pay to the registered holders of Right Certificates at the time
such Rights are exercised for shares of Preferred Stock as herein provided an
amount in cash equal to the same fraction of the current market value of one
share of Preferred Stock. For the purposes of this Section 14(b), the current
market value of a share of Preferred Stock shall be the closing price of a
share of Preferred Stock (as determined pursuant to Section 11(d)(ii) hereof)
for the Trading Day immediately prior to the date of such exercise.

          (c) The Company shall not be required to issue fractions of shares of
Common Stock or to distribute certificates which evidence fractional shares of
Common Stock upon the exercise or exchange of Rights. In lieu of such
fractional shares of Common Stock, the Company shall pay to the registered
holders of the Right Certificates at the time such Rights are exercised or
exchanged for shares of Common Stock as herein provided an amount in cash equal
to the same fraction of the current market value of a whole share of Common
Stock (as determined in accordance with Section 11(d)(i) hereof) for the
Trading Day immediately prior to the date of such exercise or exchange.

          (d) The holder of a Right by the acceptance of the Right expressly waives
the right to receive any fractional Rights or any fractional shares upon
exercise or exchange of a Right (except as provided above).

          Section 15. Rights of Action. All rights of action in respect of this Rights
Agreement, excepting the rights of action given to the Rights Agent under
Section 18 hereof, are vested in the respective registered
holders of the Right Certificates (and, prior to the Distribution Date,
the registered holders of the Common Stock); and any registered holder of any
Right Certificate (or, prior to the Distribution Date, of the Common Stock),
without the consent of the Rights Agent or of the holder of any other Right
Certificate (or, prior to the Distribution Date, of the Common Stock), on such
holder’s own behalf and for such holder’s own benefit, may 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 (or, prior to the Distribution Date,
such Common Stock) in the manner provided in such Right Certificate and in this
Rights 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 Rights
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 Rights Agreement.

-23-

 

          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:

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

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

		
	 	     (iii) the Company and the Rights Agent may deem and treat the Person
in whose name the Right Certificate (or, prior to the Distribution Date,
the Common Stock) 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 Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent, subject to
Section 7(e) hereof, shall be affected by any notice to the contrary.

          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 Stock or any other
securities of the Company which may at any time be issuable on the exercise or
exchange 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 this Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Rights
evidenced by such Right Certificate shall have been exercised or exchanged
in accordance with the provisions hereof.

          Section 18. Concerning the Rights Agent. (a) The Company agrees to pay
to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the
administration and execution of this Rights Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability or
expense, incurred without gross negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of this Rights Agreement,
including the costs and expenses of defending against any claim of liability
arising therefrom, directly or indirectly.

          (b) The Rights Agent shall be protected and shall incur no liability for,
or in respect of any action taken, suffered or omitted by it in connection
with, its administration of this Rights Agreement in reliance upon any Right
Certificate or certificate for the Preferred Stock or Common Stock or for other
securities of the Company, instrument of assignment or
transfer,

-24-

 

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

          Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any corporation into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
stock transfer or corporate trust powers of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this Rights
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 corporation would be
eligible for appointment as a successor Rights Agent under the provisions of
Section 21 hereof. In case at the time such successor Rights Agent shall
succeed to the agency created by this Rights Agreement, any of the Right
Certificates shall have been countersigned but not delivered, 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 such successor Rights Agent; and in
all such cases such Right Certificates shall have the full force provided in
the Right Certificates and in this Rights Agreement.

          (b) 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 Rights Agreement.

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

          (b) Whenever in the performance of its duties under this Rights 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 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 Chief Executive Officer,
President, any Vice President, the Treasurer or the Secretary of the Company
(each, an

-25-

 

“Authorized Officer”) and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of this Rights
Agreement in reliance upon such certificate.

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

          (d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Rights 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 under any responsibility in respect of the
validity of this Rights 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 Rights Agreement or in any Right Certificate; nor
shall it be responsible for any change in the exercisability of the Rights
(including the Rights becoming 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 and 24, or the
ascertaining of the existence of facts that would require any such change or
adjustment (except with respect to the exercise of Rights evidenced by Right
Certificates after receipt of a certificate furnished pursuant to Section 12,
describing such change or adjustment); nor shall it by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any shares of Preferred Stock or other securities to be issued
pursuant to this Rights Agreement or any Right Certificate or as to whether any shares of
Preferred Stock or other securities will, when issued, be validly authorized
and issued, fully paid and nonassessable.

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

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

-26-

 

such action (or the effective
date in the case of an omission), the Rights Agent shall have received written
instructions in response to such application specifying the action to be taken
or omitted.

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

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

          (j) If, with respect to any Right Certificate surrendered to the Rights
Agent for exercise or transfer, the certificate contained in the form of
assignment or the form of election to purchase set forth on the reverse
thereof, as the case may be, has not been completed to certify the holder is
not an Acquiring Person (or an Affiliate or Associate thereof) or a transferee
thereof, the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with the Company.

          Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Rights
Agreement upon 30 days’ notice in writing mailed to the Company and to each
transfer agent of the Common Stock or Preferred Stock by registered or
certified mail, and, following the Distribution Date, to the holders of the
Right Certificates by first-class mail. In the event the transfer agency
relationship in effect between the Company and the Rights Agent terminates, the
Rights Agent will be deemed to resign automatically on the effective date of
such termination; and any required notice will be sent to the Company. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days’
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Stock or Preferred Stock
by registered or certified mail, and, following the Distribution Date, 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 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 (A) a corporation
organized and doing business under the laws of the United States or any State
thereof, which is authorized under such laws to exercise corporate trust or
stock transfer powers and is subject to supervision or examination by federal or 

-27-

 

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 (B) an affiliate of a
corporation described in clause (A) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any such
appointment the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Stock or
Preferred Stock, and, following the Distribution Date, 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 Rights Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights in
such forms 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 Rights Agreement. In addition,
in connection with the issuance or sale of Common Stock following the
Distribution Date and prior to the Expiration Date, the Company may with
respect to shares of Common Stock so issued or sold pursuant to (i) the exercise of stock
options, (ii) under any employee plan or arrangement, (iii) the exercise,
conversion or exchange of securities, notes or debentures issued by the Company
or (iv) a contractual obligation of the Company, in each case existing prior to
the Distribution Date, issue Right Certificates representing the appropriate
number of Rights in connection with such issuance or sale.

          Section 23. Redemption and Termination. (a) The Board of Directors of
the Company may, at any time prior to such time as any Person first becomes an
Acquiring Person, redeem all but not less than all the then-outstanding Rights
at a redemption price of $.01 per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof (the “Redemption Price”). The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as the Board of
Directors in its sole discretion may establish. The Company may, at its
option, pay the Redemption Price in cash, shares of Common Stock (based on the
current market price of the Common Stock at the time of redemption as
determined pursuant to Section 11(d)(i) hereof) or any other form of
consideration deemed appropriate by the Board of Directors.

          (b) Immediately upon the action of the Board of Directors ordering the
redemption of the Rights pursuant to paragraph (a) of this Section 23 (or at
such later time as the Board of Directors may establish for the effectiveness
of such redemption), and without any further action and without any notice, the
right to exercise the Rights will terminate and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price. The Company
shall promptly give public notice of any such redemption; provided, however,
that the failure to give, or any defect in, any such notice shall not affect
the validity of such redemption. Within 10 days after such action of the
Board of Directors ordering the redemption of the Rights (or

-28-

 

such later time as the Board of Directors may establish for the effectiveness of such redemption),
the Company shall mail a notice of redemption to all the holders of the
then-outstanding Rights at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Distribution Date, on the
registry books of the transfer agent for the Common Stock. Any notice which is
mailed in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption shall state the
method by which the payment of the Redemption Price will be made.

          (c) 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, Section 24 hereof
and other than in connection with the purchase of Common Stock prior to the
Distribution Date.

          (d) It is understood that the TIDE Committee (as provided below) of the Board
of Directors shall review and evaluate this Agreement to determine whether the
maintenance of this Agreement continues to be in the interests of the Company,
its shareholders and any other relevant constituencies of the Company, at least
once every three years. Following each such review, the TIDE Committee will
communicate its conclusions to the full Board of Directors, including any
recommendation in light thereof as to whether this Agreement should be modified
or the Rights should be terminated. The TIDE Committee shall be comprised
of Independent Directors selected by the Board of Directors.

          (e) The TIDE Committee (and Independent Directors, when considering the
termination of, or any supplement or amendment to the Rights requiring
Independent Directors) shall have the power to set their own agenda and to
retain at the expense of the Company their choice of legal counsel, investment
bankers and/or other advisors. The TIDE Committee (and the Independent
Directors when considering the termination of, or amendments or supplements to,
the Rights, as described above) shall have the authority to review all
information of the Company and to consider any and all factors they deem
relevant to an evaluation of whether to maintain or modify this Agreement or
terminate the Rights.

          Section 24. Exchange. (a) The Board of Directors of the Company may, at
its option, at any time after any Person first becomes an Acquiring Person,
exchange all or part of the then-outstanding and exercisable Rights (which
shall not include Rights that have not become effective or that have become
void pursuant to the provisions of Section 11(a)(ii) hereof) for shares of
Common Stock at an exchange ratio of one share of Common Stock per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such amount per Right being
hereinafter referred to as the “Exchange Ratio”). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such
exchange at any time after an Acquiring Person becomes the Beneficial Owner of
shares of Common Stock aggregating 50% or more of the shares of Common Stock
then outstanding. From and after the occurrence of an event specified in
Section 13(a) hereof, any Rights that theretofore have not been exchanged
pursuant to this Section 24(a) shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to this Section
24(a). The exchange of the Rights by the Board of Directors may be made
effective at such time, on such basis and with such conditions as the Board of
Directors in its sole discretion may establish.

-29-

 

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

          (c) The Company may at its option substitute and, in the event that there
shall not be sufficient shares of Common Stock issued but not outstanding or
authorized but unissued (and unreserved) to permit an exchange of Rights as
contemplated in accordance with this Section 24, the Company shall substitute
to the extent of such insufficiency, for each share of Common Stock that would
otherwise be issuable upon exchange of a Right, a number of shares of Preferred
Stock or fraction thereof (or equivalent preferred shares as such term is
defined in Section 11(b)) such that the current per share market price
(determined pursuant to Section 11(d) hereof) of one share of Preferred Stock
(or equivalent preferred share) multiplied by such number or fraction is equal
to the current per share market price of one share of Common Stock (determined
pursuant to Section 11(d) hereof) as of the date of such exchange.

          Section 25. Notice of Certain Events. (a) In case the Company shall at
any time after the earlier of the Distribution Date or the Stock Acquisition
Date propose (i) to pay any dividend payable in stock of any class to the
holders of its Preferred Stock or to make any other distribution to the holders
of its Preferred Stock (other than a regular quarterly cash dividend), (ii) to
offer to the holders of its Preferred Stock rights or warrants to subscribe for
or to purchase any additional shares of Preferred Stock or shares of stock of
any class or any other securities, rights or options, (iii) to effect any
reclassification of its Preferred Stock (other than a reclassification
involving only the subdivision or combination of outstanding Preferred Stock),
(iv) to effect the liquidation, dissolution or winding up of the Company, or
(v) to declare or pay any dividend on the Common Stock payable in Common Stock
or to effect a subdivision, combination or consolidation of the Common Stock
(by reclassification or otherwise than by payment of dividends in Common
Stock), then, in each such case, the Company shall give 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 the purposes of such
stock dividend, or distribution or offering of rights or warrants, or the date
on which such liquidation, dissolution, reclassification, subdivision,
combination, consolidation or winding up is to take place and the date of
participation therein by the holders of the Common Stock and/or Preferred
Stock, if any such date is to be fixed, and such notice shall be so given in
the case of any action covered by clause (i) or (ii) above at least 10 days
prior to the record date for determining holders of the

-30-

 

Preferred Stock 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 Stock and/or Preferred
Stock, whichever shall be the earlier.

          (b) In case any event described in Section 11(a)(ii) or Section 13 shall
occur then the Company shall as soon as practicable thereafter give to each
holder of a Right Certificate (or if occurring prior to the Distribution Date,
the holders of the Common Stock) in accordance with Section 26 hereof, a notice
of the occurrence of such event, which notice shall describe such event and the
consequences of such event to holders of Rights under Section 11(a)(ii) and
Section 13 hereof.

          Section 26. Notices. Notices or demands authorized by this Rights 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:

          American Axle & Manufacturing Holdings, Inc.

          1840 Holbrook Avenue

          Detroit, Michigan 48212

          Attn: General Counsel

Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Rights 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:

          Equiserve Trust Company, N.A.

          150 Royall Street

          Canton, MA 02021

          Attn: General Counsel

Notices or demands authorized by this Rights 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. Except as otherwise provided in
this Section 27, for so long as the Rights are then redeemable, the Company may
in its sole and absolute discretion, and the Rights Agent shall if the Company
so directs, supplement or amend any provision of this Rights Agreement in any
respect without the approval of any holders of the Rights. At any time when
the Rights are no longer redeemable, except as otherwise provided in this
Section 27, the Company may, and the Rights Agent shall, if the Company so
directs, supplement or amend this Rights Agreement without the approval of any
holders of Right Certificates in order to (i) cure any ambiguity, (ii) correct
or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) shorten or lengthen any
time period hereunder, or (iv) change or supplement the provisions hereunder in
any manner which the Company may deem necessary or desirable; provided,
however, that no

-31-

 

          such supplement or amendment shall adversely affect the
interests of the holders of Right Certificates as such (other than an Acquiring
Person or an Affiliate or Associate of an Acquiring Person), and no such
amendment may cause the Rights again to become redeemable or cause this Rights
Agreement again to become amendable other than in accordance with this
sentence. Notwithstanding anything contained in this Rights Agreement to the
contrary, no supplement or amendment shall be made which decreases the
Redemption Price. Upon the delivery of a certificate from an appropriate
officer of the Company which states that the supplement or amendment is in
compliance with the terms of this Section 27, the Rights Agent shall execute
such supplement or amendment; provided that any supplement or amendment that
does not amend Sections 18, 19, 20 or 21 hereof in a manner adverse to the
Rights Agent shall become effective immediately upon execution by the Company,
whether or not also executed by the Rights Agent.

          Section 28. Successors. All the covenants and provisions of this Rights
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 Rights Agreement. Nothing in this Rights
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 Stock) any legal or equitable right,
remedy or claim under this Rights Agreement; but this Rights 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 Stock).

          Section 30. Determinations and Actions by the Board of Directors. The
Board of Directors of the Company shall have the exclusive power and authority
to administer this Rights Agreement and to exercise the 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
Rights Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Rights Agreement (including, without limitation, a determination to redeem or
not redeem the Rights or to amend this Rights Agreement). All such actions,
calculations, interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing) that are done or
made by the Board of Directors of the Company in good faith, shall (x) be
final, conclusive and binding on the Company, the Rights Agent, the holders of
the Rights, as such, and all other parties, and (y) not subject the Board of
Directors to any liability to the holders of the Rights.

          Section 31. Severability. If any term, provision, covenant or restriction
of this Rights Agreement or applicable to this Rights 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 Rights Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated.

          Section 32. Governing Law. This Rights Agreement and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware

-32-

 

          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.

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

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

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

-33-

 

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

	 	 	 	 	 
	 	 	 	AMERICAN AXLE & MANUFACTURING

HOLDINGS, INC.
	 
	Attest:	 	     	By:	     
	 	
	     	     	

	 	 	     	Name:	     
	 	 	 	Title:
	 
	 
	 	 	 	EQUISERVE TRUST COMPANY, N.A..
	 
	Attest:	 	     	By:	     
	 	
	     	     	

	 	 	     	Name:	     
	 	 	 	Title:

 

 

EXHIBIT A

FORM

OF

CERTIFICATE OF DESIGNATIONS

OF

SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

OF

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

(Pursuant to Section 151 of the

General Corporation Law of the State of Delaware)

          American Axle & Manufacturing Holdings, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
“Company”), hereby certifies that the following resolution was duly adopted by
the Board of Directors of the Company as required by Section 151 of the General
Corporation Law of the State of Delaware on September 15, 2003:

          RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Company (hereinafter being referred to as the “Board of Directors” or
the “Board”) in accordance with the provisions of the Company’s Amended and
Restated Certificate of Incorporation (hereinafter being referred to as the
“Certificate of Incorporation”), the Board of Directors hereby creates a series
of Preferred Stock, par value $.01 per share, of the Company, to be designated
the “Series A Junior Participating Preferred Stock” and hereby adopts the
resolution establishing the designations, number of shares, preferences, voting
powers and other rights and the restrictions and limitations thereof, of the
shares of such series as set forth below:

          Section 1. Designation and Amount. The shares of such series shall be
designated as “Series A Junior Participating Preferred Stock” (the “Series A
Preferred Stock”) and the number of shares constituting the Series A Preferred
Stock shall be 100,000. Such number of shares may be increased or decreased by
resolution of the Board of Directors; provided, that no decrease shall reduce
the number of shares of Series A Preferred Stock to a number less than the
number of shares then outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options, rights or warrants or upon
the conversion of any outstanding securities issued by the Company convertible
into Series A Preferred Stock.

          Section 2. Dividends and Distributions

		
	 	     (A) Subject to the rights of the holders of any shares of any series of
Preferred Stock of the Company (the “Preferred Stock”) (or any similar
stock) ranking prior and superior to the Series A Preferred Stock with
respect to dividends, the holders

A-1

 

		
	 	of shares of Series A Preferred Stock, in preference to the holders
of Common Stock, par value $.01 per share, of the Company (the “Common
Stock”) and of any other stock of the Company ranking junior to the Series
A Preferred Stock, shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the last day of January, April,
July, and October in each year (each such date being referred to herein as
a “Dividend Payment Date”), commencing on the first Dividend Payment Date
after the first issuance of a share or fraction of a share of Series A
Preferred Stock (the “Issue Date”), in an amount per share (rounded to the
nearest cent) equal to the greater of (a) $1 or (b) subject to the
provision for adjustment hereinafter set forth, 1,000 times the aggregate
per share amount of all cash dividends, and 1,000 times the aggregate per
share amount (payable in kind) of all non-cash dividends or other
distributions other than a dividend payable in shares of Common Stock,
declared on the Common Stock since the immediately preceding Dividend
Payment Date or, with respect to the first Dividend Payment Date, since
the first issuance of any share or fraction of a share of Series A
Preferred Stock. In the event the Company shall at any time after the
Issue Date declare and pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under clause
(b) of the preceding sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.

		
	 	     (B) The Company shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock); provided
that, in the event no dividend or distribution shall have been declared on
the Common Stock during the period between any Dividend Payment Date and
the next subsequent Dividend Payment Date, a dividend of $1 per share on
the Series A Preferred Stock shall nevertheless be payable, when, as and
if declared, on such subsequent Dividend Payment Date.

		
	 	     (C) Dividends shall begin to accrue and be cumulative, whether or not
earned or declared, on outstanding shares of Series A Preferred Stock from
the Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for
the first Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the
date of issue is a Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A Preferred
Stock entitled to receive a quarterly dividend and before such Dividend
Payment Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the shares of
Series A Preferred Stock in an amount less than the total amount of such
dividends at

A-2

 

		
	 	the time accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive payment of a dividend or distribution declared thereon, which
record date shall be not more than 60 days prior to the date fixed for the
payment thereof.

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

		
	 	     (A) Subject to the provision for adjustment hereinafter set forth and
except as otherwise provided in the Certificate of Incorporation or
required by law, each share of Series A Preferred Stock shall entitle the
holder thereof to 1,000 votes on all matters upon which the holders of the
Common Stock of the Company are entitled to vote. In the event the
Company shall at any time after the Issue Date declare or pay any dividend
on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the number of votes per
share to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were outstanding
immediately prior to such event.

		
	 	     (B) Except as otherwise provided herein, in the Certificate of
Incorporation or in any other Certificate of Designations creating a
series of Preferred Stock or any similar stock, and except as otherwise
required by law, the holders of shares of Series A Preferred Stock and the
holders of shares of Common Stock and any other capital stock of the
Company having general voting rights shall vote together as one class on
all matters submitted to a vote of stockholders of the Company.

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

		
	 	     (D) If, at the time of any annual meeting of stockholders for the election
of directors, the equivalent of six quarterly dividends (whether or not
consecutive) payable on any share or shares of Series A Preferred Stock
are in default, the number of directors constituting the Board of
Directors of the Company shall be increased by two. In addition to voting
together with the holders of Common Stock for the election of other
directors of the Company, the holders of record of the Series A Preferred
Stock, voting separately as a class to the exclusion of the holders of
Common Stock shall be entitled at said meeting of stockholders (and at
each subsequent annual meeting of stockholders), unless all dividends in
arrears on the Series A Preferred Stock have been paid or declared and set
apart for payment prior thereto, to vote for the election of two directors
of the Company, the holders of any Series A Preferred Stock being entitled
to cast a number of votes per

A-3

 

		
	 	share of Series A Preferred Stock as is specified in paragraph (A) of
this Section 3. Each such additional director shall serve until the next
annual meeting of stockholders for the election of directors, or until his
successor shall be elected and shall qualify, or until his right to hold
such office terminates pursuant to the provisions of this Section 3(D).
Until the default in payments of all dividends which permitted the
election of said directors shall cease to exist, any director who shall
have been so elected pursuant to the provisions of this Section 3(D) may
be removed at any time, without cause, only by the affirmative vote of the
holders of the shares of Series A Preferred Stock at the time entitled to
cast a majority of the votes entitled to be cast for the election of any
such director at a special meeting of such holders called for that
purpose, and any vacancy thereby created may be filled by the vote of such
holders. If and when such default shall cease to exist, the holders of the
Series A Preferred Stock shall be divested of the foregoing special voting
rights, subject to revesting in the event of each and every subsequent
like default in payments of dividends. Upon the termination of the
foregoing special voting rights, the terms of office of all persons who
may have been elected directors pursuant to said special voting rights
shall forthwith terminate, and the number of directors constituting the
Board of Directors shall be reduced by two. The voting rights granted by
this Section 3(D) shall be in addition to any other voting rights granted
to the holders of the Series A Preferred Stock in this Section 3.

          Section 4. Certain Restrictions.

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

		
	 	     (i) declare or pay dividends, or make any other distributions,
on any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock;
	 
	 	     (ii) declare or pay dividends, or make any other distributions,
on any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
	 
	 	     (iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock, provided that the Company may at any time redeem, purchase or
otherwise acquire shares of any such junior stock in exchange for
shares of any stock of the Company ranking junior (as to dividends
and upon dissolution, liquidation or winding up) to the Series A
Preferred Stock or rights, warrants or options to acquire such junior
stock; or

A-4

 

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

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

          Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Company in any manner whatsoever shall
be retired and cancelled promptly after the acquisition thereof. All such
shares shall upon their retirement become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of Preferred Stock
to be created by resolution or resolutions of the Board of Directors, subject
to any conditions and restrictions on issuance set forth herein.

          Section 6. Liquidation, Dissolution or Winding Up. Upon any liquidation,
dissolution or winding up of the Company, no distribution shall be made (A) to
the holders of the Common Stock or of shares of any other stock of the Company
ranking junior, upon liquidation, dissolution or winding up, to the Series A
Preferred Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not earned
or declared, to the date of such payment, provided that the holders of shares
of Series A Preferred Stock shall be entitled to receive an aggregate amount
per share, subject to the provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount to be distributed per share to holders of
shares of Common Stock, or (B) to the holders of shares of stock ranking on a
parity upon liquidation, dissolution or winding up with the Series A Preferred
Stock, except distributions made ratably on the Series A Preferred Stock and
all such parity stock in proportion to the total amounts to which the holders
of all such shares are entitled upon such liquidation, dissolution or winding
up. In the event, however, that there are not sufficient assets available to
permit payment in full of the Series A liquidation preference and the
liquidation preferences of all other classes and series of stock of the
Company, if any, that rank on a parity with the Series A Preferred Stock in
respect thereof, then the assets available for such distribution shall be
distributed ratably to the holders of the Series A Preferred Stock and the
holders of such parity shares in the proportion to their respective liquidation
preferences. In the event the Company shall at any time after the Issue Date
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (A) of

A-5

 

the preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to
such event.

          Neither the merger or consolidation of the Company into or with another
entity nor the merger or consolidation of any other entity into or with the
Company (nor the sale of all or substantially all of the assets of the Company)
shall be deemed to be a liquidation, dissolution or winding up of the Company
within the meaning of this Section 6.

          Section 7. Consolidation, Merger, etc. In case the Company shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are converted into, exchanged for or changed into other
stock or securities, cash and/or any other property, then in any such case each
share of Series A Preferred Stock shall at the same time be similarly converted
into, exchanged for or changed into an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 1,000 times the
aggregate amount of stock, securities, cash and/or any other property (payable
in kind), as the case may be, into which or for which each share of Common
Stock is converted, exchanged or converted. In the event the Company shall at
any time after the Issue Date declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the conversion,
exchange or change of shares of Series A Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

          Section 8. No Redemption. The shares of Series A Preferred Stock shall
not be redeemable from any holder.

          Section 9. Rank. The Series A Preferred Stock shall rank, with respect to
the payment of dividends and the distribution of assets upon liquidation,
dissolution or winding up of the Company, junior to all other series of
Preferred Stock and senior to the Common Stock.

          Section 10. Amendment. If any proposed amendment to the Certificate of
Incorporation (including this Certificate of Designations) would alter, change
or repeal any of the preferences, powers or special rights given to the Series
A Preferred Stock so as to affect the Series A Preferred Stock adversely, then
the holders of the Series A Preferred Stock shall be entitled to vote
separately as a class upon such amendment, and the affirmative vote of
two-thirds of the outstanding shares of the Series A Preferred Stock, voting
separately as a class, shall be necessary for the adoption thereof, in addition
to such other vote as may be required by the General Corporation Law of the
State of Delaware.

          Section 11. Fractional Shares. Series A Preferred Stock may be issued in
fractions of a share that shall entitle the holder, in proportion to such
holder’s fractional shares,

A-6

 

to exercise voting rights, receive dividends, participate in distributions
and to have the benefit of all other rights of holders of Series A Preferred
Stock.

A-7

 

          IN WITNESS WHEREOF, this Certificate of Designations is executed on behalf
of the Company by its                                  and attested by its Secretary this        th
day of                           , 2003.

	 	 	 
	 	 	

	 	 	Name:
	 	 	
Title:
	 
	Attest:	 	 
	 
	     	 	 
	 
	
	 	 
	Secretary	 	 

A-8

 

EXHIBIT B

FORM OF RIGHT CERTIFICATE

	Certificate No. R-___	___ Rights

		
	 	NOT EXERCISABLE AFTER                     , 2013 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN
ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN
TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE
TRANSFERABLE.

Right Certificate

AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.

     This certifies that                          or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of September 15, 2003 as the same may be
amended from time to time (the “Rights Agreement”), between American Axle &
Manufacturing Holdings, Inc., a Delaware corporation (the “Company”), and
EquiServe Trust Company, N.A. as Rights Agent (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 5:00 P.M., New
York City time, on September 15, 2013 at the office or agency of the
Rights Agent designated for such purpose, or of its successor as Rights Agent,
one one-thousandth of a fully paid non-assessable share of Series A Junior
Participating Preferred Stock, par value $.01 per share (the “Preferred
Stock”), of the Company, at a purchase price of $120.00 per one
one-thousandth of a share of Preferred Stock (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 Rights
Certificate (and the number of one one-thousandths of a share of Preferred
Stock which may be purchased upon exercise hereof) set forth above, and the
Purchase Price set forth above, are the number and Purchase Price as of
September 15, 2003 based on the Preferred Stock as
constituted at such date. As provided in the Rights Agreement, the Purchase
Price, the number of one one-thousandths of a share of Preferred Stock (or
other securities or property) which may be purchased upon the exercise of the
Rights and the number of Rights evidenced by this Right Certificate are subject
to modification and adjustment upon the happening of certain events.

B-1

 

     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. The Company will mail to the holder of this Right Certificate a copy
of the Rights Agreement without charge after receipt of a written request
therefor.

     This Right Certificate, with or without other Right Certificates, upon
surrender at the office or agency of the Rights Agent designated for such
purpose, 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 shares of Preferred Stock 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
$.01 per Right or (ii) may be exchanged in whole or in part for shares of
Preferred Stock or shares of the Company’s Common Stock, par value $.01 per
share.

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

     No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred
Stock or of any other securities of the Company which may at any time be
issuable on the exercise or exchange 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 or exchanged 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.

B-2

 

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

	 	 	 	 	 
	ATTEST:	 	
AMERICAN AXLE & MANUFACTURING

HOLDINGS, INC.	 
	 
	 	 	 	 	
	By:	 	 	By:	 
	 	
	 	 	

	 
	 
	 	 	 		
	Countersigned:	 	 	 
	 
	 
	 	 	,	 	
	
		 	 
	as Rights Agent	 	 	 
	 	 	 	 	
	 
	 
	By:	 	 	 	 
	 	
	 	 	 
	 	Authorized Signatory	 	 	 

B-3

 

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 transfer unto                                                  

(Please print name and address of transferee)

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

	 	 	 	 
	Dated:                                                  ,     	 	 
	 
	 
	 
	 	

Signature

Signature Guaranteed:

          Signatures must be guaranteed by a bank, trust company, broker, dealer or
other eligible institution participating in a recognized signature guarantee
medallion program.

          The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, were not acquired by the undersigned
from, and are not being sold, assigned or transferred to, an Acquiring Person
or an Affiliate or Associate thereof (as defined in the Rights Agreement).

	 	 	 	 
	 	 	 
	 
	 
	 
	 	

Signature

B-4

 

EXHIBIT C

		
	 	UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES
THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.

SUMMARY OF RIGHTS TO PURCHASE

Shares of Preferred Stock

          On September 15, 2003 the Board of Directors of American Axle &
Manufacturing Holdings, Inc. (the “Company”) declared a dividend of one
preferred share purchase right (a “Right”) for each outstanding share of common
stock, par value $.01 per share of the Company (the “Common Stock”). The
dividend is payable on September 25, 2003 (the “Record Date”) to the
stockholders of record on that date. Each Right entitles the registered holder
to purchase from the Company one one-thousandth of a share of Series A Junior
Participating Preferred Stock, par value $.01 per share (the “Preferred Stock”)
of the Company at a price of $120.00 per one one-thousandth of a share of
Preferred Stock (as the same may be adjusted, the “Purchase Price”). The
description and terms of the Rights are set forth in a Rights Agreement dated
as of September 15, 2003 (as the same may be amended from time to time, the
“Rights Agreement”), between the Company and EquiServe Trust Company, N.A., as
Rights Agent (the “Rights Agent”).

          Until the close of business on the earlier of (i) the tenth day after the
first date of 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 shares of Common Stock or (ii) the tenth
business day (or such later date as may be determined by action of the Board of
Directors prior to such time as any person or group of affiliated persons
becomes an Acquiring Person) after the date of commencement of, or the first
public announcement of an intention to commence, 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 the outstanding shares of Common Stock (the
earlier of such dates being called the “Distribution Date”), the Rights will be
evidenced by the Common Stock certificates. The Rights Agreement does not
restrict any person who beneficially owns 15% or more of the Common Stock as of
the date of the Rights Agreement so long as such person does not become the
beneficial owner of additional shares of Common Stock representing 2% or more
of the outstanding shares of Common Stock.

          The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be
transferable only in connection with the transfer of Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for shares of Common Stock
outstanding as of the Record Date, even without a notation incorporating the
Rights Agreement by reference or a copy of this Summary of Rights, will also
constitute the transfer of the Rights associated with the shares of Common
Stock 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 Stock as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.

C-1

 

          The Rights are not exercisable until the Distribution Date. The Rights
will expire on September 15, 2013 (the “Final Expiration Date”), unless the
Final Expiration Date is extended 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 shares of Preferred Stock or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for or purchase Preferred Stock at a
price, or securities convertible into Preferred Stock with a conversion price,
less than the then-current market price of the Preferred Stock or (iii) upon
the distribution to holders of the Preferred Stock of evidences of indebtedness
or assets (excluding regular periodic cash dividends or dividends payable in
Preferred Stock) or of subscription rights or warrants (other than those
referred to above).

          The Rights are also subject to adjustment in the event of a stock dividend
on the Common Stock payable in shares of Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.

          Shares of Preferred Stock purchasable upon exercise of the Rights will not
be redeemable. Each share of Preferred Stock will be entitled, when, as and if
declared, to a minimum preferential quarterly dividend payment of the greater
of (a) $1 per share and (b) an amount equal to 1,000 times the dividend
declared per share of Common Stock. In the event of liquidation, dissolution
or winding up of the Company, the holders of the Preferred Stock will be
entitled to a minimum preferential liquidation payment of $100 per share (plus
any accrued but unpaid dividends) but will be entitled to an aggregate 1,000
times the payment made per share of Common Stock. Each share of Preferred
Stock will have 1,000 votes, voting together with the Common Stock. Finally,
in the event of any merger, consolidation or other transaction in which shares
of Common Stock are converted or exchanged, each share of Preferred Stock will
be entitled to receive 1,000 times the amount received per share of Common
Stock. These rights are protected by customary antidilution provisions.

          Because of the nature of the Preferred Stock’s dividend, liquidation and
voting rights, the value of the one one-thousandth interest in a share of
Preferred Stock purchasable upon exercise of each Right should approximate the
value of one share of Common Stock.

          In the event that any person or group of affiliated or associated persons
becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereupon become void),
will thereafter have the right to receive upon exercise of a Right and payment
of the Purchase Price, that number of shares of Common Stock having a market
value of two times the Purchase Price.

          In the event that, after a person or group has become an Acquiring Person, the
Company is acquired in a merger or other business combination transaction or
50% or more of its consolidated assets or earning power are sold, proper
provision will be made so that each holder of a Right (other than Rights
beneficially owned by an Acquiring Person which will have become void) will
thereafter have the right to receive, upon the exercise thereof at the then-

C-2

 

current exercise price of the Right, that number of shares of common stock
of the person with whom the Company has engaged in the foregoing transaction
(or its parent), which number of shares at the time of such transaction will
have a market value of two times the Purchase Price.

          At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of 50% or more of the
outstanding shares of Common Stock or the occurrence of an event described in
the prior paragraph, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or a fractional share of Preferred Stock (or of a share of a similar class or
series of the Company’s preferred stock having similar rights, preferences and
privileges) of equivalent value, 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 shares of Preferred Stock will be issued
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock, which may, at the election of the Company, be
evidenced by depositary receipts) and in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Stock on the last
trading day prior to the date of exercise.

          At any time prior to the time an Acquiring Person becomes such, the Board
of Directors of the Company may redeem the Rights in whole, but not in part, at
a price of $.01 per Right (the “Redemption Price”). The redemption of the
Rights may be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
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.

          For so long as the Rights are then redeemable, the Company may, except
with respect to the Redemption Price, amend the Rights Agreement in any manner.
After the Rights are no longer redeemable, the Company may, except with
respect to the Redemption Price, amend the Rights Agreement in any manner that
does not adversely affect the interests of holders of the Rights.

          Until a Right is exercised or exchanged, 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.

          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 19, 2003. 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, as the same may be amended from time to time, which is hereby
incorporated herein by reference.

C-3<PAGE>

                                                                    EXHIBIT 10.3

                              AMENDED AND RESTATED
                               SECURITY AGREEMENT

         THIS AMENDED AND RESTATED SECURITY AGREEMENT (this "Security
Agreement") is entered into as of July 22, 2003 among UNITED STATES CAN COMPANY,
a Delaware corporation (the "Borrower"), U.S. CAN CORPORATION, a Delaware
corporation and each of the Domestic Subsidiaries of the Borrower (individually
a "Domestic Guarantor" and collectively the "Domestic Guarantors"; together with
the Borrower, individually an "Obligor" and collectively the "Obligors") and
BANK OF AMERICA, N.A., in its capacity as collateral agent (in such capacity,
the "Collateral Agent") for the lenders from time to time party to the Credit
Agreement described below (the "Lenders").

                                    RECITALS

         WHEREAS, pursuant to that certain Credit Agreement dated as of October
4, 2000 (as previously amended or modified, as amended as of the date hereof
pursuant to the Third Amendment (as defined below) and as further amended,
modified, extended, renewed, restated or replaced from time to time, the "Credit
Agreement") among the Borrower, the Foreign Subsidiary Borrowers party thereto,
the Domestic Guarantors, the Lenders, the Collateral Agent in its capacity as
Administrative Agent, Citicorp North America, Inc., as Syndication Agent, and
Bank One, NA (Main Office Chicago), as Documentation Agent, the Lenders have
agreed to make Loans and issue Letters of Credit upon the terms and subject to
the conditions set forth therein;

         WHEREAS, in connection with the Credit Agreement, the Borrower, the
Domestic Guarantors and the Collateral Agent entered into that certain Security
Agreement dated as of October 4, 2000 (the "Existing Security Agreement"); and

         WHEREAS, in connection with that certain Third Amendment to Credit
Agreement dated as of the date hereof (the "Third Amendment") among the
Borrower, the Domestic Guarantors, the Lenders party thereto and the
Administrative Agent, the Obligors and the Collateral Agent, on behalf of the
Lenders, have agreed to amend and restate the Existing Security Agreement in
accordance with the terms of this Security Agreement.

         NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

         1.       Definitions.

                  (a)      Unless otherwise defined herein, capitalized terms
         used herein shall have the meanings ascribed to such terms in the
         Credit Agreement, and the following terms which are defined in the
         Uniform Commercial Code (the "UCC") in effect in the State of New York
         are used herein as so defined: Accounts, Chattel Paper, Commercial Tort
         Claims, Deposit Accounts, Documents, Electronic Chattel Paper,
         Equipment, Farm Products, Fixtures, General Intangibles, Goods,
         Instruments, Inventory, Investment Property, Letter-

                                       1
<PAGE>

         of-Credit Rights, Payment Intangibles, Proceeds, Securities
         Intermediary, Software and Supporting Obligations. For purposes of this
         Security Agreement, the term "Lender" shall include any Affiliate of
         any Lender which has entered into a Hedging Agreement with any Credit
         Party. Except as otherwise expressly provided, all definitions shall be
         equally applicable to the singular and plural forms of the terms
         defined.

                  (b)      In addition, the following terms shall have the
         following meanings:

                  "Copyright Licenses": any agreement, whether written or oral,
         providing for the grant by or to an Obligor of any right under any
         Copyright, including, without limitation, any thereof referred to in
         Schedule 6.19 to the Credit Agreement.

                  "Copyrights": (a) all copyrights in all Works, now existing or
         hereafter created or acquired, all registrations and recordings
         thereof, and all applications in connection therewith, including,
         without limitation, registrations, recordings and applications in the
         United States Copyright Office or in any similar office or agency of
         the United States, any State thereof or any other country or any
         political subdivision thereof, or otherwise, and including, without
         limitation, any thereof referred to in Schedule 6.19 to the Credit
         Agreement, and (b) all renewals thereof, including, without limitation,
         any thereof referred to in Schedule 6.19 to the Credit Agreement.

                  "Intellectual Property": all Copyrights, Copyright Licenses,
         Patents, Patent Licenses, Trademarks, and Trademark Licenses.

                  "Patent License": all agreements, whether written or oral,
         providing for the grant by or to an Obligor of any right to
         manufacture, use or sell any invention covered by a Patent, including,
         without limitation, any thereof referred to in Schedule 6.19 to the
         Credit Agreement.

                  "Patents": (a) all letters patent of the United States or any
         other country and all improvement patents, reissues, reexaminations,
         patents of additions, renewals and extensions thereof, including,
         without limitation, any thereof referred to in Schedule 6.19 to the
         Credit Agreement, and (b) all applications for letters patent of the
         United States or any other country, and all divisions, continuations
         and continuations-in-part thereof, including, without limitation, any
         thereof referred to in Schedule 6.19 to the Credit Agreement.

                  "Secured Obligations": the collective reference to all of the
         Credit Party Obligations owing from the Borrower or any other Credit
         Party to any Lender or the Collateral Agent, howsoever evidenced,
         created, incurred or acquired, whether primary, secondary, direct,
         contingent, or joint and several, including, without limitation, all
         obligations and liabilities incurred in connection with collecting and
         enforcing the foregoing; provided, however the obligations under any
         Hedging Agreement owed to any Lender or any Affiliate of a Lender shall
         constitute Secured Obligations only so long as the other Credit Party
         Obligations remain outstanding and/or the Commitments are in effect.

                                       2
<PAGE>

                  "Trademark License": means any agreement, whether written or
         oral, providing for the grant by or to an Obligor of any right to use
         any Trademark, including, without limitation, any thereof referred to
         in Schedule 6.19 to the Credit Agreement.

                  "Trademarks": (a) all trademarks, service marks, trade names,
         corporate names, fictitious business names, all elements of package or
         trade dress of goods or services, logos and other source or business
         identifiers, and the goodwill associated therewith, now existing or
         hereafter adopted or acquired, all registrations and recordings
         thereof, and all applications in connection therewith, whether in the
         United States Patent and Trademark Office or in any similar office or
         agency of the United States, any State thereof or any other country or
         any political subdivision thereof, or otherwise, including, without
         limitation, any thereof referred to in Schedule 6.19 to the Credit
         Agreement, and (b) all renewals thereof, including, without limitation,
         any thereof referred to in Schedule 6.19 to the Credit Agreement.

                  "Work": any work which is subject to copyright protection
         pursuant to Title 17 of the United States Code or the applicable
         copyright laws of any other state or country.

         2.       Grant of Security Interest in the Collateral. To secure the
prompt payment and performance in full when due, whether by lapse of time,
acceleration or otherwise, of the Secured Obligations, each Obligor hereby
grants to the Collateral Agent, for the benefit of the Lenders, a continuing
security interest in, and a right to set off against, any and all right, title
and interest of such Obligor in and to the following, whether now owned or
existing or owned, acquired, or arising hereafter (collectively, the
"Collateral"):

                                    (a)      all Accounts;

                                    (b)      all cash and Cash Equivalents;

                                    (c)      all Chattel Paper;

                                    (d)      all Copyrights;

                                    (e)      all Copyright Licenses;

                                    (f)      all Deposit Accounts;

                                    (g)      all Documents;

                                    (h)      all Equipment;

                                    (i)      all Fixtures;

                                    (j)      all General Intangibles (including
                           Payment Intangibles and Software);

                                    (k)      all Goods;

                                       3
<PAGE>

                                    (l)      all Instruments;

                                    (m)      all Inventory;

                                    (n)      all Investment Property;

                                    (o)      all Patents;

                                    (p)      all Patent Licenses;

                                    (q)      all Supporting Obligations and
                           Letter-of-Credit Rights;

                                    (r)      all Trademarks;

                                    (s)      all Trademark Licenses;

                                    (t)      all books, records, ledger cards,
                           files, correspondence, computer programs, tapes,
                           disks, and related data processing software (owned by
                           such Obligor or in which it has an interest) that at
                           any time evidence or contain information relating to
                           any Collateral or are otherwise necessary in the
                           collection thereof or realization thereupon;

                                    (u)      all other personal property of any
                           kind or type whatsoever owned by such Obligor; and

                                    (v)      to the extent not otherwise
                           included, all Proceeds, tort claims, insurance claims
                           and other rights to payments not otherwise included
                           in the foregoing and products of any and all of the
                           foregoing.

         Notwithstanding the foregoing, the Obligors do not grant a security
interest in, or a right of setoff against, any of the following:

         (i)      any contract, license, permit or franchise that validly
                  prohibits the creation by the Obligor of a security interest
                  in such contract, license, permit or franchise (or in any
                  rights or property obtained by the Obligor under such
                  contract, license, permit or franchise) so long as such
                  contract, license, permit or franchise was not entered into or
                  obtained by the Obligors with the intent of avoiding the
                  requirement that a security interest be granted therein and
                  except to the extent such prohibition on the creation of a
                  security interest is rendered ineffective under Sections
                  9-406, 9-407, 9-408 or 9-409 of the UCC; provided, however,
                  that the provisions of this paragraph shall not prohibit the
                  security interests created by this Security Agreement from
                  extending to the proceeds of such contract, license, permit or
                  franchise (or such rights or property) or to the monetary
                  value of the good will and other general intangibles of the
                  Obligor relating thereto unless the contract, license, permit
                  or franchise in question so prohibits; or

                                       4
<PAGE>

         (i)      any rights or property to the extent that any valid and
                  enforceable law or regulation applicable to such rights or
                  property prohibits the creation of a security interest
                  therein, except to the extent such prohibition on the creation
                  of a security interest is rendered ineffective under Sections
                  9-406, 9-407, 9-408 or 9-409 of the UCC; provided, however,
                  that the provisions of this paragraph shall not prohibit the
                  security interests created by this Security Agreement from
                  extending to the proceeds of such rights or property or to the
                  monetary value of the good will and other general intangibles
                  of the Obligor relating thereto unless the law or regulation
                  in question prohibits such extension.

         The Obligors and the Collateral Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest created hereby in the
Collateral (A) constitutes continuing collateral security for all of the Secured
Obligations, whether now existing or hereafter arising and (B) is not to be
construed as an assignment of any Intellectual Property.

         3.       Provisions Relating to Accounts, Contracts and Agreements.

                  (a)      Anything herein to the contrary notwithstanding, each
         of the Obligors shall remain liable under each of its Accounts,
         contracts and agreements to observe and perform all the conditions and
         obligations to be observed and performed by it thereunder, all in
         accordance with the terms of any agreement giving rise to each such
         Account or the terms of such contract or agreement. Neither the
         Collateral Agent nor any Lender shall have any obligation or liability
         under any Account (or any agreement giving rise thereto), contract or
         agreement by reason of or arising out of this Security Agreement or the
         receipt by the Collateral Agent or any Lender of any payment relating
         to such Account, contract or agreement pursuant hereto, nor shall the
         Collateral Agent or any Lender be obligated in any manner to perform
         any of the obligations of an Obligor under or pursuant to any Account
         (or any agreement giving rise thereto), contract or agreement, to make
         any payment, to make any inquiry as to the nature or the sufficiency of
         any payment received by it or as to the sufficiency of any performance
         by any party under any Account (or any agreement giving rise thereto),
         contract or agreement, to present or file any claim, to take any action
         to enforce any performance or to collect the payment of any amounts
         which may have been assigned to it or to which it may be entitled at
         any time or times.

                  (b)      At any time and from time to time in accordance with
         the terms of Section 7.10 of the Credit Agreement, the Collateral Agent
         shall have the right, but not the obligation, to make test
         verifications of the Accounts in any manner and through any medium that
         it reasonably considers advisable, and the Obligors shall furnish all
         such assistance and information as the Collateral Agent may reasonably
         require in connection with such test verifications. Upon the Collateral
         Agent's request and at the expense of the Obligors (when required by
         the Credit Agreement), the Obligors shall cause independent public
         accountants or others satisfactory to the Collateral Agent to furnish
         to the Collateral Agent reports showing reconciliations, aging and test
         verifications of, and trial balances for, the Accounts. The Collateral
         Agent in its own name or in the name of others may

                                       5
<PAGE>

         communicate with account debtors on the Accounts to verify with them to
         the Collateral Agent's satisfaction the existence, amount and terms of
         any Accounts.

         4.       Representations and Warranties. Each Obligor hereby represents
and warrants to the Collateral Agent, for the benefit of the Lenders, that so
long as any of the Secured Obligations remain outstanding (other than any such
obligations which by the terms thereof are stated to survive termination of the
Credit Documents) or any Credit Document or Hedging Agreement between any Credit
Party and any Lender (to the extent the obligations of such Credit Party
thereunder constitute Credit Party Obligations) is in effect, and until all of
the Commitments shall have been terminated:

                  (a)      Chief Executive Office; Books & Records. Such
         Obligor's chief executive office and chief place of business is (and
         for the prior four months has been) located at the locations set forth
         on Schedule 6.27(c) to the Credit Agreement (as updated from time to
         time), and such Obligor keeps its books and records at such locations.

                  (b)      Commercial Tort Claims. As of the date hereof, none
         of the Obligors has any Commercial Tort Claims.

                  (c)      Ownership. Such Obligor is the legal and beneficial
         owner of the Collateral which it purports to own and has a valid right
         to use all of its other Collateral. Such Obligor has the right to
         pledge, sell, assign or transfer the same. Such Obligor's legal name is
         as shown in this Security Agreement and such Obligor's state of
         incorporation and, if required for filing a financing statement under
         the applicable UCC, organization identification number issued by such
         Obligor's state of incorporation is as set forth in Schedule 4(c)
         hereto and such Obligor has not in the past four months changed its
         name, been party to a merger, consolidation or other change in
         structure or used any tradename except as set forth in Schedule 4(c)
         attached hereto. Schedule 4(c) may be updated from time to time by the
         Obligors by giving written notice thereof to the Collateral Agent. Such
         Obligor has only one state of incorporation or organization.

                  (d)      Security Interest/Priority. This Security Agreement
         creates a valid security interest in favor of the Collateral Agent, for
         the benefit of the Lenders, in the Collateral of such Obligor and, when
         properly perfected by filing or otherwise, shall constitute a valid
         first priority, perfected security interest in such Collateral, to the
         extent such security interest can be perfected by filing or otherwise
         under the UCC, federal law or other applicable personal property
         security legislation, free and clear of all Liens except for Permitted
         Liens.

                  (e)      Consents. Except for the filing or recording of UCC
         financing statements to perfect the Liens created by this Security
         Agreement that may be perfected through the filing of a UCC financing
         statement and/or applicable federal filings for Intellectual Property,
         no consent or authorization of, filing with, or other act by or in
         respect of, any arbitrator or Governmental Authority and no consent of
         any other Person (including, without limitation, any stockholder,
         member or creditor of such Obligor), is required (i) for the grant by
         such Obligor of the security interest in the Collateral granted hereby
         or for the execution, delivery or performance of this Security
         Agreement by such Obligor or (ii) for the perfection

                                       6
<PAGE>

         of such security interest or the exercise by the Collateral Agent of
         the rights and remedies provided for in this Security Agreement.

                  (f)      Farm Products. None of the Collateral constitutes, or
         is the Proceeds of, Farm Products.

                  (g)      Accounts. With respect to the Accounts of the
         Obligors: (i) the goods sold and/or services furnished giving rise to
         each Account are not subject to any security interest or Lien except
         the first priority, perfected security interest granted to the
         Collateral Agent herein and except for Permitted Liens; and (ii) each
         Account and the papers and documents of the applicable Obligor relating
         thereto are genuine and in all material respects what they purport to
         be; (iii) no Account of an Obligor is evidenced by any Instrument
         unless such Instrument has been theretofore endorsed over and delivered
         to the Collateral Agent; (iv) the amount of each Account as shown on
         the applicable Obligor's books and records, and on all invoices and
         statements which may be delivered to the Collateral Agent with respect
         thereto, is due and payable to the applicable Obligor; (v) to each of
         the Obligors' knowledge, the account debtor with respect to each
         Account has the capacity to contract; and (vi) no surety bond was
         required or given in connection with any Account of an Obligor or the
         contracts or purchase orders out of which they arose unless the
         Collateral Agent was given prior notice thereof.

                  (h)      Inventory. No Inventory of an Obligor is held by a
         third party (other than an Obligor) pursuant to consignment, sale or
         return, sale on approval or similar arrangement, unless such Obligor
         has properly perfected a purchase money security interest therein.

                  (i)      Copyrights, Patents and Trademarks.

                           (i)      Schedule 6.19 to the Credit Agreement
                  includes all registered Intellectual Property and all other
                  material Intellectual Property, in each case owned or used by
                  the Obligors, as such Schedule 6.19 may be updated from time
                  to time.

                           (ii)     All Intellectual Property of such Obligor is
                  valid, subsisting, unexpired, enforceable and has not been
                  abandoned, and each Obligor is legally entitled to use each of
                  its tradenames.

                           (iii)    Except as set forth on Schedule 6.19 to the
                  Credit Agreement, no holding, decision or judgment has been
                  rendered against any Obligor by any Governmental Authority
                  which would limit, cancel or question the validity of any
                  material Intellectual Property of the Obligors.

                           (iv)     Except as set forth on Schedule 6.19 to the
                  Credit Agreement, no action or proceeding is pending seeking
                  to limit, cancel or question the validity of any material
                  Intellectual Property of the Obligors.

                           (v)      All applications pertaining to the material
                  Intellectual Property of each Obligor have been duly and
                  properly filed, all registrations or letters pertaining

                                       7
<PAGE>

                  to such Intellectual Property have been duly and properly
                  filed and issued, and all of such Intellectual Property is
                  valid and enforceable.

                           (vi)     No Obligor has made any assignment or
                  agreement in conflict with the security interest in the
                  Intellectual Property of any Obligor hereunder.

                  (j)      Documents, Instruments, Letter-of-Credit Rights and
                           Chattel Paper. All Documents, Instruments,
         Letter-of-Credit Rights and Chattel Paper describing, evidencing or
         constituting Collateral are, to the Obligor's knowledge, complete,
         valid and genuine.

                  (k)      Restrictions on Security Interest. Except as
         permitted by Section 8.13 of the Credit Agreement, none of the Obligors
         is party to any material contract, license, permit or franchise that
         contains legally enforceable restrictions on the granting of a security
         interest therein.

                  (l)      Equipment. With respect to each Obligor's Equipment:
         (i) such Obligor has good and marketable title thereto; and (ii) all
         such Equipment is in normal operating condition and repair, ordinary
         wear and tear alone excepted (subject to casualty events).

                  (m)      Investment Property. As of the Closing Date, none of
         the Obligors own any Investment Property except as listed on Schedule
         6.15 to the Credit Agreement.

         5.       Covenants. Each Obligor covenants that, so long as any of the
Secured Obligations remain outstanding (other than any such obligations which by
the terms thereof are stated to survive termination of the Credit Documents) or
any Credit Document or Hedging Agreement between any Credit Party and any Lender
(to the extent the obligations of such Credit Party thereunder constitute Credit
Party Obligations) is in effect, and until all of the Commitments shall have
been terminated, such Obligor shall:

                  (a)      Other Liens. Defend the Collateral against the claims
         and demands of all other parties claiming an interest therein, keep the
         Collateral free from all Liens, except for Permitted Liens, and not
         sell, exchange, transfer, assign, lease or otherwise dispose of the
         Collateral or any interest therein, except as permitted under the
         Credit Agreement.

                  (b)      Preservation of Collateral. Keep the Collateral in
         good order, condition and repair in all material respects, ordinary
         wear and tear excepted, except for property disposed of in accordance
         with the Credit Agreement; not use the Collateral in violation of the
         provisions of this Security Agreement or any other Credit Document or
         any policy insuring the Collateral or any applicable statute, law,
         bylaw, rule, regulation or ordinance; not permit Collateral with a fair
         market value exceeding $3,000,000 in the aggregate in any year to be or
         become a fixture to real property or an accession to other personal
         property unless the Collateral Agent has a valid, perfected and first
         priority security interest for the benefit of the Lenders in such
         fixture or such personal property to which such Collateral has become
         an accession; and not, without the prior written consent of the
         Collateral Agent, alter or remove any identifying symbol or number on
         its Equipment.

                                       8
<PAGE>

                  (c)      Instruments. If any amount payable under or in
         connection with any of the Collateral shall be or become evidenced by
         any Instrument or if any Collateral shall be stored or shipped subject
         to a Document, immediately deliver such Instrument or Document to the
         Collateral Agent, duly endorsed in a manner satisfactory to the
         Collateral Agent, to be held as Collateral pursuant to this Security
         Agreement.

                  (d)      Changes to Chief Executive Office, Jurisdiction of
         Incorporation, Name or Structure. Not, without providing 30 days prior
         written notice to the Collateral Agent and without filing (or
         confirming that the Collateral Agent has filed) such amendments to any
         previously filed financing statements or any such new financing
         statements as the Collateral Agent may require, (a) change the location
         of its chief executive office and chief place of business (as well as
         its books and records) from the locations set forth on Schedule 6.27(c)
         to the Credit Agreement, (b) reincorporate or reorganize itself under
         the laws of any jurisdiction other than the jurisdiction in which it is
         incorporated or organized as of the date hereof, or (c) change its
         name, be party to a merger, consolidation or other change in structure
         or use any tradename other than as set forth on Schedule 4(c) attached
         hereto.

                  (e)      Inspection. Allow the Collateral Agent or its
         representatives to visit and inspect the Collateral as set forth in
         Section 7.10 of the Credit Agreement.

                  (f)      Perfection of Security Interest. Execute and deliver
         to the Collateral Agent such agreements, assignments or instruments
         (including affidavits, notices, reaffirmations and amendments of
         existing documents, as the Collateral Agent may reasonably request) and
         do all such other things as the Collateral Agent may reasonably deem
         necessary or appropriate (i) to assure to the Collateral Agent its
         security interests hereunder, including (A) such financing statements
         (including renewal statements) or amendments thereof or supplements
         thereto or other instruments as the Collateral Agent may from time to
         time reasonably request in order to perfect and maintain the security
         interests granted hereunder in accordance with the UCC and any other
         personal property security legislation in the appropriate state(s) or
         province(s), (B) with regard to Investment Property, execute and cause
         the Securities Intermediary with respect to such Investment Property to
         execute a securities control agreement in form and substance
         satisfactory to the Collateral Agent, (C) with regard to Copyrights, a
         Notice of Grant of Security Interest in Copyrights in the form of
         Exhibit 5(f)(ii)(A) attached hereto, (D) with regard to Patents, a
         Notice of Grant of Security Interest in Patents for filing with the
         United States Patent and Trademark Office in the form of Exhibit
         5(f)(ii)(B) attached hereto and (E) with regard to Trademarks, a Notice
         of Grant of Security Interest in Trademarks for filing with the United
         States Patent and Trademark Office in the form of Exhibit 5(f)(ii)(C)
         attached hereto, (ii) to consummate the transactions contemplated
         hereby and (iii) to otherwise protect and assure the Collateral Agent
         of its rights and interests hereunder. To that end, each Obligor agrees
         that the Collateral Agent may file one or more financing statements
         (including financing statements containing a collateral description of
         "all assets" and/or "all personal property" of such Obligor) disclosing
         the Collateral Agent's security interest in any or all of the
         Collateral of such Obligor without, to the extent permitted by law,
         such Obligor's signature thereon, and

                                       9
<PAGE>

         further each Obligor also hereby irrevocably makes, constitutes and
         appoints the Collateral Agent, its nominee or any other Person whom the
         Collateral Agent may designate, as such Obligor's attorney-in-fact with
         full power and for the limited purpose to sign in the name of such
         Obligor any such financing statements, or amendments and supplements to
         financing statements, renewal financing statements, notices or any
         similar documents which in the Collateral Agent's reasonable discretion
         would be necessary, appropriate or convenient in order to perfect and
         maintain perfection of the security interests granted hereunder, such
         power, being coupled with an interest, being and remaining irrevocable
         so long as any of the Secured Obligations remain outstanding or any
         Credit Document or Hedging Agreement between any Credit Party and any
         Lender (to the extent the obligations of such Credit Party thereunder
         constitute Credit Party Obligations) is in effect, and until all of the
         Commitments shall have been terminated. Each Obligor hereby agrees that
         a carbon, photographic or other reproduction of this Security Agreement
         or any such financing statement is sufficient for filing as a financing
         statement by the Collateral Agent without notice thereof to such
         Obligor wherever the Collateral Agent may in its sole discretion desire
         to file the same. In the event for any reason the law of any
         jurisdiction other than New York becomes or is applicable to the
         Collateral of any Obligor or any part thereof, or to any of the Secured
         Obligations, such Obligor agrees to execute and deliver all such
         instruments and to do all such other things as the Collateral Agent
         reasonably deems necessary or appropriate to preserve, protect and
         enforce the security interests of the Collateral Agent under the law of
         such other jurisdiction (and, if an Obligor shall fail to do so
         promptly upon the request of the Collateral Agent, then the Collateral
         Agent may execute any and all such requested documents on behalf of
         such Obligor pursuant to the power of attorney granted hereinabove).
         Upon the request of the Collateral Agent, each Obligor agrees to mark
         its books and records to reflect the security interest of the
         Collateral Agent in the Collateral.

                  (g)      Collateral Held by Warehouseman, Bailee, etc. If any
         Collateral that is a single asset with a fair market value in excess of
         $100,000 or a group of assets with a fair market value in excess of
         $500,000 is at any time in the possession or control of a warehouseman,
         bailee or any agent or processor of such Obligor, notify the Collateral
         Agent of such possession, notify such Person of the Collateral Agent's
         security interest for the benefit of the Lenders in such Collateral,
         instruct such Person to hold all such Collateral for the Collateral
         Agent's account subject to the Collateral Agent's instructions and
         obtain acknowledgments from such Person that it is holding the
         Collateral for the benefit of the Collateral Agent.

                  (h)      Treatment of Accounts. (i) Not grant or extend the
         time for payment of any Account, or compromise or settle any Account
         for less than the full amount thereof, or release any Person or
         property, in whole or in part, from payment thereof, or allow any
         credit or discount thereon, other than in the prudent conduct of an
         Obligor's business and (ii) maintain at its principal place of business
         a record of Accounts consistent with customary business practices.

                                       10
<PAGE>

                  (i)      Covenants Relating to Copyrights.

                           (i)      Employ the Copyright for each material Work
                  with such notice of copyright as may be required by law to
                  secure copyright protection.

                           (ii)     (A) Not do any act or knowingly omit to do
                  any act whereby any material Copyright may become invalidated;
                  (B) not do any act, or knowingly omit to do any act, whereby
                  any material Copyright may become injected into the public
                  domain; (C) notify the Collateral Agent immediately if it
                  knows, or has reason to know, that any material Copyright may
                  become injected into the public domain or of any adverse
                  determination or development (including, without limitation,
                  the institution of, or any such determination or development
                  in, any proceeding in any court or tribunal in the United
                  States or any other country) regarding an Obligor's ownership
                  of any such material Copyright or its validity; (D) take all
                  necessary steps as it shall deem appropriate under the
                  circumstances to maintain and pursue each application, to
                  obtain the relevant registration and to maintain each
                  registration of each material Copyright owned by an Obligor
                  including, without limitation, filing of applications for
                  renewal where necessary; and (E) promptly notify the
                  Collateral Agent of any material infringement of any material
                  Copyright of an Obligor of which it becomes aware and take
                  such actions as it shall reasonably deem appropriate under the
                  circumstances to protect such Copyright, including, where
                  appropriate, the bringing of suit for infringement, seeking
                  injunctive relief and seeking to recover any and all damages
                  for such infringement.

                           (iii)    Except in connection with sales or other
                  dispositions permitted under the Credit Agreement, not make
                  any assignment or agreement in conflict with the security
                  interest in the Copyrights of each Obligor hereunder other
                  than in the ordinary course of business.

                  (j)      Covenants Relating to Patents and Trademarks.

                           (i)      (A) Continue to use each material Trademark
                  in order to maintain such Trademark in full force free from
                  any claim of abandonment for non-use, (B) maintain as in the
                  past the quality of products and services offered under such
                  Trademark, (C) employ such Trademark with the appropriate
                  notice of registration, or notice of trademark or service
                  mark, as applicable, sufficient to protect such Trademark, (D)
                  not adopt or use any mark which is confusingly similar or a
                  colorable imitation of such Trademark unless the Collateral
                  Agent, for the ratable benefit of the Lenders, shall obtain a
                  perfected security interest in such mark pursuant to this
                  Security Agreement, and (E) not (and not permit any licensee
                  or sublicensee thereof to) do any act or knowingly omit to do
                  any act whereby any material Trademark may become invalidated.

                           (ii)     Not do any act, or omit to do any act,
                  whereby any material Patent may become abandoned or dedicated.

                                       11
<PAGE>

                           (iii)    Promptly notify the Collateral Agent if it
                  knows, or has reason to know, that any application or
                  registration relating to any material Patent or material
                  Trademark may become abandoned or dedicated, or of any adverse
                  determination or development (including, without limitation,
                  the institution of, or any such determination or development
                  in, any proceeding in the United States Patent and Trademark
                  Office or any court or tribunal in any country) regarding an
                  Obligor's ownership of any such Patent or Trademark or its
                  right to register the same or to keep, maintain and use the
                  same.

                           (iv)     Whenever an Obligor, either by itself or
                  through an agent, employee, licensee or designee, shall file
                  an application for the registration of any Patent or Trademark
                  with the United States Patent and Trademark Office of any
                  similar office or agency in any other country or any political
                  subdivision thereof, such Obligor shall promptly report such
                  filing to the Collateral Agent. Upon request of the Collateral
                  Agent, an Obligor shall execute and deliver any and all
                  agreements, instruments, documents and papers as the
                  Collateral Agent, may reasonably request to evidence the
                  Collateral Agent's and the Lenders' security interest in any
                  Patent or Trademark and the goodwill and General Intangibles
                  of such Obligor relating thereto or represented thereby.

                           (v)      Take all reasonable and necessary steps,
                  including, without limitation, in any proceeding before the
                  United States Patent and Trademark Office, or any similar
                  office or agency in any other country or any political
                  subdivision thereof, to maintain and pursue each application,
                  to obtain the relevant registration and to maintain each
                  registration of the material Patents and Trademarks,
                  including, without limitation, filing of applications for
                  renewal, affidavits of use and affidavits of incontestability.

                           (vi)     Promptly notify the Collateral Agent and the
                  Lenders after it learns that any material Patent or material
                  Trademark included in the Collateral is infringed,
                  misappropriated or diluted by a third party and promptly sue
                  for infringement, misappropriation or dilution, to seek
                  injunctive relief where appropriate and to recover any and all
                  damages for such infringement, misappropriation or dilution,
                  or take such other actions as it shall reasonably deem
                  appropriate under the circumstances to protect such Patent or
                  Trademark.

                           (vii)    Except for licenses to third parties in the
                  ordinary course of business or except in connection with sales
                  or other dispositions permitted under the Credit Agreement,
                  not make any assignment or agreement in conflict with the
                  security interest in the Patents or Trademarks of any Obligor
                  hereunder.

                  (k)      New Patents, Copyrights and Trademarks. Promptly
         provide the Collateral Agent with (i) a listing of all applications, if
         any, for new Copyrights, Patents or Trademarks (together with a listing
         of the issuance of registrations or letters on present applications),
         which new applications and issued registrations or letters shall be
         subject to the terms and conditions hereunder, and (ii) (A) with
         respect to new Copyrights, a duly executed Notice of

                                       12
<PAGE>

         Grant of Security Interest in Copyrights in the form of Exhibit
         5(f)(ii)(A) attached hereto, (B) with respect to new Patents, a duly
         executed Notice of Grant of Security Interest in Patents in the form of
         Exhibit 5.1(f)(ii)(B) attached hereto, (C) with respect to new
         Trademarks, a duly executed Notice of Grant of Security Interest in
         Trademarks in the form of Exhibit 5.1(f)(ii)(C) attached hereto or (D)
         such other duly executed documents as the Collateral Agent may
         reasonably request in a form acceptable to counsel for the Collateral
         Agent and suitable for recording to evidence the security interest of
         the Collateral Agent for the benefit of the Lenders in the Copyright,
         Patent or Trademark which is the subject of such new application.

                  (l)      Insurance. Insure, repair and replace the Collateral
         of such Obligor as set forth in the Credit Agreement. All insurance
         proceeds shall be subject to the security interest of the Collateral
         Agent hereunder.

                  (m)      Investment Property. Not acquire any Investment
         Property without executing and delivering, or causing to be executed
         and delivered, to the Collateral Agent such agreements, documents and
         instruments as the Collateral Agent may require to perfect the
         Collateral Agent's security interest therein.

                  (n)      Contracts. Except as permitted by Section 8.13 of the
         Credit Agreement, no Obligor shall (i) enter into any contract,
         license, permit or franchise that prohibits the granting of a security
         interest in favor of the Collateral Agent or the Lenders or (ii) amend
         or modify any existing contracts, licenses, permits or franchises to
         prohibit the granting of a security interest in favor of the Collateral
         Agent or the Lenders.

                  (o)      Commercial Tort Claims. Within 45 days of the end of
         each fiscal quarter of the Obligors, each Obligor shall notify the
         Collateral Agent of any commercial tort claim acquired by it and unless
         otherwise consented by the Collateral Agent, such Obligor shall enter
         into a supplement to this Security Agreement, granting to the
         Collateral Agent a Lien in such commercial tort claim.

                  (p)      Letters of Credit. If any Obligor is or becomes the
         beneficiary of a letter of credit (other than a letter of credit that
         is a Supporting Obligation), such Obligor shall promptly, and in any
         event within two (2) Business Days after becoming a beneficiary, notify
         the Collateral Agent thereof and enter into a tri-party agreement with
         the Collateral Agent and the issuer and/or confirmation bank with
         respect to Letter-of-Credit Rights assigning such Letter-of-Credit
         Rights to the Collateral Agent, all in form and substance reasonably
         satisfactory to the Collateral Agent.

                  (q)      Electronic Chattel Paper. Each Obligor shall take all
         steps necessary to grant the Collateral Agent control of all electronic
         Chattel Paper in accordance with the UCC and all "transferable records"
         as defined in each of the Uniform Electronic Transactions Act and the
         Electronic Signatures in Global and National Commerce Act.

         6.       Performance of Obligations and Advances by Collateral Agent.
On failure of any Obligor to perform any of the covenants and agreements
contained herein, the Collateral Agent

                                       13
<PAGE>

may, at its sole option and in its reasonable discretion, perform or cause to be
performed the same and in so doing may expend such sums as the Collateral Agent
may reasonably deem advisable in the performance thereof, including, without
limitation, the payment of any insurance premiums, the payment of any taxes, a
payment to obtain a release of a Lien or potential Lien, expenditures made in
defending against any adverse claim and all other expenditures which the
Collateral Agent may make for the protection of the security interest hereof or
may be compelled to make by operation of law. All such sums and amounts so
expended shall be repayable by the Obligors on a joint and several basis
promptly upon timely notice thereof and demand therefor, shall constitute
additional Secured Obligations and shall bear interest from the date said
amounts are expended at the default rate specified in Section 3.1 of the Credit
Agreement for Revolving Loans that are Base Rate Loans. No such performance of
any covenant or agreement by the Collateral Agent on behalf of any Obligor, and
no such advance or expenditure therefor, shall relieve the Obligors of any
default under the terms of this Security Agreement, the other Credit Documents
or any Hedging Agreement between any Credit Party and any Lender. The Collateral
Agent may make any payment hereby authorized in accordance with any bill,
statement or estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of such bill,
statement or estimate or into the validity of any tax assessment, sale,
forfeiture, tax lien, title or claim except to the extent such payment is being
contested in good faith by an Obligor in appropriate proceedings and against
which adequate reserves are being maintained in accordance with GAAP.

         7.       Events of Default.

         The occurrence of an event which under the Credit Agreement would
constitute an Event of Default shall be an event of default hereunder (an "Event
of Default").

         8.       Remedies.

                  (a)      General Remedies. Upon the occurrence of an Event of
         Default and during the continuance thereof, the Lenders shall have, in
         addition to the rights and remedies provided herein, in the Credit
         Documents, in any Hedging Agreement between any Credit Party and any
         Lender or by law (including, but not limited to, the rights and
         remedies set forth in the Uniform Commercial Code of the jurisdiction
         applicable to the affected Collateral), the rights and remedies of a
         secured party under the UCC (regardless of whether the UCC is the law
         of the jurisdiction where the rights and remedies are asserted and
         regardless of whether the UCC applies to the affected Collateral), and
         further, the Collateral Agent may, with or without judicial process or
         the aid and assistance of others, to the fullest extent permitted by
         law, (i) enter on any premises on which any of the Collateral may be
         located and, without resistance or interference by the Obligors, take
         possession of the Collateral, (ii) dispose of any Collateral on any
         such premises, (iii) require the Obligors to assemble and make
         available to the Collateral Agent at the expense of the Obligors any
         Collateral at any place and time designated by the Collateral Agent
         which is reasonably convenient to both parties, (iv) remove any
         Collateral from any such premises for the purpose of effecting sale or
         other disposition thereof, and/or (v) without demand and without
         advertisement, notice, hearing or process of law, all of which each of
         the Obligors hereby waives to the fullest extent permitted by law
         (including Article 9 of the UCC), at any place

                                       14
<PAGE>

         and time or times, sell and deliver any or all Collateral held by or
         for it at public or private sale, by one or more contracts, in one or
         more parcels, for cash, upon credit or otherwise, at such prices and
         upon such terms as the Collateral Agent deems advisable, in its sole
         discretion (subject to any and all mandatory legal requirements). In
         addition to all other sums due the Collateral Agent and the Lenders
         with respect to the Secured Obligations, the Obligors shall pay the
         Collateral Agent and each of the Lenders all reasonable documented
         costs and expenses incurred by the Collateral Agent or any such Lender,
         including, but not limited to, reasonable attorneys' fees and court
         costs, in obtaining or liquidating the Collateral, in enforcing payment
         of the Secured Obligations, or in the prosecution or defense of any
         action or proceeding by or against the Collateral Agent or the Lenders
         or the Obligors concerning any matter arising out of or connected with
         this Security Agreement, any Collateral or the Secured Obligations,
         including, without limitation, any of the foregoing arising in, arising
         under or related to a case under the Bankruptcy Code. To the extent the
         rights of notice cannot be legally waived hereunder, each Obligor
         agrees that any requirement of reasonable notice shall be met if such
         notice is personally served on or mailed postage prepaid to the
         Borrower in accordance with the notice provisions of Section 11.1 of
         the Credit Agreement at least 10 days before the time of sale or other
         event giving rise to the requirement of such notice. The Collateral
         Agent and the Lenders shall not be obligated to make any sale or other
         disposition of the Collateral regardless of notice having been given.
         To the extent permitted by law, any Lender may be a purchaser at any
         such sale. To the extent permitted by applicable law, each of the
         Obligors hereby waives all of its rights of redemption with respect to
         any such sale. Subject to the provisions of applicable law, the
         Collateral Agent and the Lenders may postpone or cause the postponement
         of the sale of all or any portion of the Collateral by announcement at
         the time and place of such sale, and such sale may, without further
         notice, to the extent permitted by law, be made at the time and place
         to which the sale was postponed, or the Collateral Agent and the
         Lenders may further postpone such sale by announcement made at such
         time and place.

                  (b)      Remedies relating to Accounts. Upon the occurrence of
         an Event of Default and during the continuance thereof, whether or not
         the Collateral Agent has exercised any or all of its rights and
         remedies hereunder, each Obligor will promptly upon request of the
         Collateral Agent instruct all account debtors to remit all payments in
         respect of Accounts to a mailing location selected by the Collateral
         Agent. In addition, upon the occurrence and during the continuance of
         an Event of Default, the Collateral Agent or its designee may notify
         any Obligor's customers and account debtors that the Accounts of such
         Obligor have been assigned to the Collateral Agent or of the Collateral
         Agent's security interest therein, and may (either in its own name or
         in the name of an Obligor or both) demand, collect (including without
         limitation by way of a lockbox arrangement), receive, take receipt for,
         sell, sue for, compound, settle, compromise and give acquittance for
         any and all amounts due or to become due on any Account, and, in the
         Collateral Agent's discretion, file any claim or take any other action
         or proceeding to protect and realize upon the security interest of the
         Lenders in the Accounts. The Collateral Agent and the Lenders shall
         have no liability or responsibility to any Obligor for acceptance of a
         check, draft or other order for payment of money bearing the legend
         "payment in full" or words of similar import or any other restrictive
         legend or endorsement or be responsible for determining the correctness
         of any

                                       15
<PAGE>

         remittance. Each Obligor hereby agrees to indemnify the Collateral
         Agent and the Lenders from and against all liabilities, damages,
         losses, actions, claims, judgments, costs, expenses, charges and
         reasonable attorneys' fees suffered or incurred by the Collateral Agent
         or the Lenders (each, an "Indemnified Party") because of the
         maintenance of the foregoing arrangements except as relating to or
         arising out of the gross negligence or willful misconduct of an
         Indemnified Party or its officers, employees or agents. In the case of
         any investigation, litigation or other proceeding, the foregoing
         indemnity shall be effective whether or not such investigation,
         litigation or proceeding is brought by an Obligor, its directors,
         shareholders or creditors or an Indemnified Party or any other Person
         or any other Indemnified Party is otherwise a party thereto.

                  (c)      Access. In addition to the rights and remedies
         hereunder, upon the occurrence of an Event of Default and during the
         continuance thereof, the Collateral Agent shall have the right as
         between the Collateral Agent and the Obligors to enter and remain upon
         the various premises of the Obligors without cost or charge to the
         Collateral Agent, and use the same, together with materials, supplies,
         books and records of the Obligors for the purpose of collecting and
         liquidating the Collateral, or for preparing for sale and conducting
         the sale of the Collateral, whether by foreclosure, auction or
         otherwise. In addition, the Collateral Agent may remove Collateral, or
         any part thereof, from such premises and/or any records with respect
         thereto, in order to effectively collect or liquidate such Collateral.

                  (d)      Nonexclusive Nature of Remedies. Failure by the
         Collateral Agent or the Lenders to exercise any right, remedy or option
         under this Security Agreement, any other Credit Document, any Hedging
         Agreement between any Credit Party and any Lender or as provided by
         law, or any delay by the Collateral Agent or the Lenders in exercising
         the same, shall not operate as a waiver of any such right, remedy or
         option. No waiver hereunder shall be effective unless it is in writing,
         signed by the party against whom such waiver is sought to be enforced
         and then only to the extent specifically stated, which in the case of
         the Collateral Agent or the Lenders shall only be granted as provided
         herein. To the extent permitted by law, neither the Collateral Agent,
         the Lenders, nor any party acting as attorney for the Collateral Agent
         or the Lenders, shall be liable hereunder for any acts or omissions or
         for any error of judgment or mistake of fact or law other than their
         gross negligence or willful misconduct hereunder. The rights and
         remedies of the Collateral Agent and the Lenders under this Security
         Agreement shall be cumulative and not exclusive of any other right or
         remedy which the Collateral Agent or the Lenders may have.

                  (e)      Retention of Collateral. The Collateral Agent may,
         after providing the notices required by Section 9-621 of the UCC or
         otherwise complying with the requirements of applicable law of the
         relevant jurisdiction, to the extent the Collateral Agent is in
         possession of any of the Collateral, retain the Collateral in
         satisfaction of the Secured Obligations. Unless and until the
         Collateral Agent shall have provided such notices, however, the
         Collateral Agent shall not be deemed to have retained any Collateral in
         satisfaction of any Secured Obligations for any reason.

                                       16
<PAGE>

                  (f)      Deficiency. In the event that the proceeds of any
         sale, collection or realization are insufficient to pay all amounts to
         which the Collateral Agent or the Lenders are legally entitled, the
         Obligors shall be jointly and severally liable for the deficiency,
         together with interest thereon at the default rate specified in Section
         3.1 of the Credit Agreement for Revolving Loans that are Base Rate
         Loans, together with the costs of collection and the reasonable fees of
         any attorneys employed by the Collateral Agent to collect such
         deficiency. Any surplus remaining after the full payment and
         satisfaction of the Secured Obligations shall be returned to the
         Obligors or to whomsoever a court of competent jurisdiction shall
         determine to be entitled thereto.

         9.       Rights of the Collateral Agent.

                  (a)      Power of Attorney. In addition to other powers of
         attorney contained herein, to the fullest extent permitted by
         applicable law, each Obligor hereby designates and appoints the
         Collateral Agent, on behalf of the Lenders, and each of its designees
         or agents, as attorney-in-fact of such Obligor, irrevocably and with
         power of substitution, with authority to take any or all of the
         following actions upon the occurrence and during the continuance of an
         Event of Default:

                           (i)      to demand, collect, settle, compromise,
                  adjust and give discharges and releases concerning the
                  Collateral of such Obligor, all as the Collateral Agent may
                  reasonably determine;

                           (ii)     to commence and prosecute any actions at any
                  court for the purposes of collecting any Collateral and
                  enforcing any other right in respect thereof;

                           (iii)    to defend, settle, adjust or compromise any
                  action, suit or proceeding brought and, in connection
                  therewith, give such discharge or release as the Collateral
                  Agent may deem reasonably appropriate;

                           (iv)     to receive, open and dispose of mail
                  addressed to an Obligor and endorse checks, notes, drafts,
                  acceptances, money orders, bills of lading, warehouse receipts
                  or other instruments or documents evidencing payment, shipment
                  or storage of the goods giving rise to the Collateral of such
                  Obligor, or securing or relating to such Collateral, on behalf
                  of and in the name of such Obligor;

                           (v)      to sell, assign, transfer, make any
                  agreement in respect of, or otherwise deal with or exercise
                  rights in respect of, any Collateral or the goods or services
                  which have given rise thereto, as fully and completely as
                  though the Collateral Agent were the absolute owner thereof
                  for all purposes;

                           (vi)     to adjust and settle claims under any
                  insurance policy relating thereto;

                                       17
<PAGE>

                           (vii)    to execute and deliver all assignments,
                  conveyances, statements, financing statements, renewal
                  financing statements, security agreements, affidavits, notices
                  and other agreements, instruments and documents that the
                  Collateral Agent may determine necessary in order to perfect
                  and maintain the security interests and liens granted in this
                  Security Agreement and in order to fully consummate all of the
                  transactions contemplated herein;

                           (viii)   to institute any foreclosure proceedings
                  that the Collateral Agent may deem appropriate; and

                           (ix)     to do and perform all such other acts and
                  things as the Collateral Agent may reasonably deem to be
                  necessary, proper or convenient in connection with the
                  Collateral.

         This power of attorney is a power coupled with an interest and shall be
         irrevocable (i) for so long as any of the Secured Obligations remain
         outstanding (other than any such obligations which by the terms thereof
         are stated to survive termination of the Credit Documents) or any
         Credit Document or any Hedging Agreement between any Credit Party and
         any Lender (to the extent the obligations of such Credit Party
         thereunder constitute Credit Party Obligations) is in effect and (ii)
         until all of the Commitments shall have been terminated. The Collateral
         Agent shall be under no duty to exercise or withhold the exercise of
         any of the rights, powers, privileges and options expressly or
         implicitly granted to the Collateral Agent in this Security Agreement,
         and shall not be liable for any failure to do so or any delay in doing
         so. The Collateral Agent shall not be liable for any act or omission or
         for any error of judgment or any mistake of fact or law in its
         individual capacity or its capacity as attorney-in-fact except acts or
         omissions resulting from its gross negligence or willful misconduct.
         This power of attorney is conferred on the Collateral Agent solely to
         protect, preserve and realize upon its security interest in the
         Collateral.

                  (b)      Assignment by the Collateral Agent. Subject to the
         terms of the Credit Agreement, the Collateral Agent may from time to
         time assign the Secured Obligations and any portion thereof and/or the
         Collateral and any portion thereof, and the assignee shall be entitled
         to all of the rights and remedies of the Collateral Agent under this
         Security Agreement in relation thereto.

                  (c)      The Collateral Agent's Duty of Care. Other than the
         exercise of reasonable care to ensure the safe custody of the
         Collateral while being held by the Collateral Agent hereunder, the
         Collateral Agent shall have no duty or liability to preserve rights
         pertaining thereto, it being understood and agreed that the Obligors
         shall be responsible for preservation of all rights in the Collateral,
         and the Collateral Agent shall be relieved of all responsibility for
         the Collateral upon surrendering it or tendering the surrender of it to
         the Obligors. The Collateral Agent shall be deemed to have exercised
         reasonable care in the custody and preservation of the Collateral in
         its possession if the Collateral is accorded treatment substantially
         equal to that which the Collateral Agent accords its own property,

                                       18
<PAGE>

         which shall be no less than the treatment employed by a reasonable and
         prudent agent in the industry, it being understood that the Collateral
         Agent shall not have responsibility for taking any necessary steps to
         preserve rights against any parties with respect to any of the
         Collateral.

         10.      Application of Proceeds. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the Collateral
Agent or any of the Lenders in cash or its equivalent, will be applied in
reduction of the Secured Obligations in the order set forth in Section 9.3 of
the Credit Agreement, and each Obligor irrevocably waives the right to direct
the application of such payments and proceeds.

         11.      Costs of Counsel. At all times hereafter, whether or not an
Event of Default exists, the Obligors agree to promptly pay upon demand any and
all reasonable costs and expenses of the Collateral Agent or the Lenders, (a) as
required under Section 11.5 of the Credit Agreement and (b) as necessary to
protect the Collateral or to exercise any rights or remedies under this Security
Agreement or with respect to any Collateral. All of the foregoing costs and
expenses shall constitute Secured Obligations hereunder.

         12.      Continuing Agreement.

                  (a)      This Security Agreement shall be a continuing
         agreement in every respect and shall remain in full force and effect so
         long as any of the Secured Obligations remain outstanding (other than
         any such obligations which by the terms thereof are stated to survive
         termination of the Credit Documents) or any Credit Document or any
         Hedging Agreement between any Credit Party and any Lender (to the
         extent the obligations of such Credit Party thereunder constitute
         Credit Party Obligations) is in effect, and until all of the
         Commitments thereunder shall have terminated. Upon such payment and
         termination, this Security Agreement shall be automatically terminated
         and the Collateral Agent and the Lenders shall, upon the request and at
         the expense of the Obligors, forthwith release all of their Liens and
         security interests hereunder and shall execute and deliver all UCC
         termination statements and/or other documents reasonably requested by
         the Obligors evidencing such termination. Notwithstanding the
         foregoing, all releases and indemnities provided hereunder shall
         survive termination of this Security Agreement.

                  (b)      This Security Agreement shall continue to be
         effective or be automatically reinstated, as the case may be, if at any
         time payment, in whole or in part, of any of the Secured Obligations is
         rescinded or must otherwise be restored or returned by the Collateral
         Agent or any Lender as a preference, fraudulent conveyance or otherwise
         under any bankruptcy, insolvency or similar law, all as though such
         payment had not been made; provided that in the event payment of all or
         any part of the Secured Obligations is rescinded or must be restored or
         returned, all reasonable costs and expenses (including without
         limitation any reasonable legal fees and disbursements) incurred by the
         Collateral Agent or any Lender in defending and enforcing such
         reinstatement shall be deemed to be included as a part of the Secured
         Obligations.

                                       19
<PAGE>

                  (c)      This Security Agreement is in amendment of, and
         continuation of, the Existing Security Agreement and the Secured
         Obligations represents the same obligations secured pursuant to the
         Existing Security Agreement.

         13.      Amendments; Waivers; Modifications. This Security Agreement
and the provisions hereof may not be amended, waived, modified, changed,
discharged or terminated except as set forth in Section 11.6 of the Credit
Agreement.

         14.      Successors in Interest. This Security Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Collateral Agent and the Lenders hereunder, to the benefit
of the Collateral Agent and the Lenders and their successors and permitted
assigns; provided, however, that none of the Obligors may assign its rights or
delegate its duties hereunder without the prior written consent of each Lender
or the Required Lenders, as required by the Credit Agreement. To the fullest
extent permitted by law, each Obligor hereby releases the Collateral Agent and
each Lender, and its successors and assigns, from any liability for any act or
omission relating to this Security Agreement or the Collateral, except for any
liability arising from the gross negligence or willful misconduct of the
Collateral Agent, or such Lender, or its officers, employees or agents.

         15.      Notices. All notices required or permitted to be given under
this Security Agreement shall be in conformance with Section 11.1 of the Credit
Agreement.

         16.      Counterparts; Telecopy. This Security Agreement may be
executed in any number of counterparts, each of which where so executed and
delivered shall be an original, but all of which shall constitute one and the
same instrument. It shall not be necessary in making proof of this Security
Agreement to produce or account for more than one such counterpart. Delivery of
an executed counterpart by facsimile shall be as effective as an original
executed counterpart and shall be deemed a representation that an original
executed counterpart will be delivered.

         17.      Headings. The headings of the sections and subsections hereof
are provided for convenience only and shall not in any way affect the meaning,
construction or interpretation of any provision of this Security Agreement.

         18.      Governing Law; Submission to Jurisdiction; Venue.

                  (a)      THIS SECURITY AGREEMENT AND THE RIGHTS AND
         OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED
         AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
         Any legal action or proceeding with respect to this Security Agreement
         may be brought in the courts of the State of New York, or of the United
         States for the Southern District of New York, and, by execution and
         delivery of this Security Agreement, each Obligor hereby irrevocably
         accepts for itself and in respect of its property, generally and
         unconditionally, the jurisdiction of such courts. Each Obligor further
         irrevocably consents to the service of process out of any of the
         aforementioned courts in any such action or proceeding

                                       20
<PAGE>

         by the mailing of copies thereof by registered or certified mail,
         postage prepaid, to it at the address for notices pursuant to Section
         11.1 of the Credit Agreement, such service to become effective 30 days
         after such mailing. Nothing herein shall affect the right of the
         Collateral Agent to serve process in any other manner permitted by law
         or to commence legal proceedings or to otherwise proceed against any
         Obligor in any other jurisdiction.

                  (b)      Each Obligor hereby irrevocably waives any objection
         which it may now or hereafter have to the laying of venue of any of the
         aforesaid actions or proceedings arising out of or in connection with
         this Security Agreement brought in the courts referred to in subsection
         (a) hereof and hereby further irrevocably waives and agrees not to
         plead or claim in any such court that any such action or proceeding
         brought in any such court has been brought in an inconvenient forum.

         19.      Waiver of Jury Trial; Waiver of Consequential Damages. EACH OF
THE PARTIES TO THIS SECURITY AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS SECURITY AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY. Each Obligor agrees not to assert any claim
against the Agents, any Lender, any of their Affiliates, or any of their
respective directors, officers, employees, attorneys or agents, on any theory of
liability, for special, indirect, consequential or punitive damages arising out
of or otherwise relating to any of the transactions contemplated herein.

         20.      Severability. If any provision of this Security Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.

         21.      Entirety. This Security Agreement together with the other
Credit Documents represent the entire agreement of the parties hereto and
thereto, and supersede all prior agreements and understandings, oral or written,
if any, including any commitment letters or correspondence relating to the
Credit Documents or the transactions contemplated herein and therein.

         22.      Survival. All representations and warranties of the Obligors
hereunder shall survive the execution and delivery of this Security Agreement,
the other Credit Documents and the Hedging Agreements between any Credit Party
and any Lender (to the extent the obligations of such Credit Party thereunder
constitute Credit Party Obligations), the delivery of the Notes, the making of
the Loans and the issuance of the Letters of Credit.

         23.      Other Security. To the extent that any of the Secured
Obligations are now or hereafter secured by property other than the Collateral
(including, without limitation, real property and securities owned by an
Obligor), or by a guarantee, endorsement or property of any other Person, then
the Collateral Agent and the Lenders shall have the right to proceed against
such other property, guarantee or endorsement upon the occurrence of any Event
of Default, and the Collateral

                                       21
<PAGE>

Agent and the Lenders have the right, in their sole discretion, to determine
which rights, security, liens, security interests or remedies the Collateral
Agent and the Lenders shall at any time pursue, relinquish, subordinate, modify
or take with respect thereto, without in any way modifying or affecting any of
them or any of the Collateral Agent's and the Lenders' rights or the Secured
Obligations under this Security Agreement, under any other of the Credit
Documents or under any Hedging Agreement between any Credit Party and any
Lender.

         24.      Rights of Required Lenders. To the fullest extent permitted by
law, all rights of the Collateral Agent hereunder, if not exercised by the
Collateral Agent, may be exercised by the Required Lenders.

                                       22
<PAGE>

         Each of the parties hereto has caused a counterpart of this Security
Agreement to be duly executed and delivered as of the date first above written.

BORROWER:

                                    UNITED STATES CAN COMPANY,
                                    a Delaware corporation

                                    By: /s/ Sandra K. Vollman
                                       ---------------------------------
                                    Name: Sandra K. Vollman
                                         -------------------------------
                                    Title: Sr. VP and CFO
                                          ------------------------------

DOMESTIC
GUARANTORS:

                                    U.S. CAN CORPORATION,
                                    a Delaware corporation

                                    By: /s/ Sandra K. Vollman
                                       ---------------------------------
                                    Name: Sandra K. Vollman
                                         -------------------------------
                                    Title: Sr. VP and CFO
                                          ------------------------------

                                    USC MAY VERPACKUNGEN HOLDING, INC.,
                                    a Delaware corporation

                                    By: /s/ Sandra K. Vollman
                                       ---------------------------------
                                    Name: Sandra K. Vollman
                                         -------------------------------
                                    Title: Sr. VP and CFO
                                          ------------------------------

                                                            AMENDED AND RESTATED
                                                              SECURITY AGREEMENT

<PAGE>

         Accepted and agreed to as of the date first above written.

                                    BANK OF AMERICA, N.A.,
                                    as Collateral Agent

                                    By: /s/ Liliana Claar
                                       ---------------------------------
                                    Name: Liliana Claar
                                         -------------------------------
                                    Title: Vice President
                                          ------------------------------

                                                              SECURITY AGREEMENT

<PAGE>

                                  SCHEDULE 4(c)

       MERGERS, CONSOLIDATIONS, CHANGE IN STRUCTURE OR USE OF TRADENAMES

None, except use of "U.S. Can" and "May Verpackungen" as abbreviated forms of
company names.

<PAGE>

                               EXHIBIT 5(f)(ii)(A)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                   COPYRIGHTS

United States Copyright Office

         Please be advised that pursuant to the Security Agreement dated as of
October 4, 2000 (as the same may be amended, modified, extended or restated from
time to time, the "Security Agreement") by and among the Obligors party thereto
(each a "Obligor" and collectively, the "Obligors") and Bank of America, N.A.,
as Collateral Agent (the "Collateral Agent") for the Lenders referenced therein
(the "Lenders"), the undersigned Obligor has granted a continuing security
interest in and continuing lien upon, the copyrights and copyright applications
shown below to the Collateral Agent for the ratable benefit of the Lenders:

                                 COPYRIGHTS

<TABLE>
<CAPTION>
                                                                Date of
Copyright No.               Description of Copyright           Copyright
-------------               ------------------------           ---------
<S>                         <C>                                <C>
</TABLE>

                            Copyright Applications

<TABLE>
<CAPTION>
   Copyright                Description of Copyright           Date of Copyright
Applications No.                  Applied For                     Applications
----------------                  -----------                     ------------
<S>                         <C>                                <C>
</TABLE>

<PAGE>

         The Obligors and the Collateral Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing copyrights and
copyright applications (i) may only be terminated in accordance with the terms
of the Security Agreement and (ii) is not to be construed as an assignment of
any copyright or copyright application.

                                    Very truly yours,

                                    ____________________________________
                                    [Obligor]

                                    By:_________________________________
                                    Name:_______________________________
                                    Title:______________________________

Acknowledged and Accepted:

BANK OF AMERICA, N.A.,
as Collateral Agent

By:_________________________________
Name:_______________________________
Title:______________________________

<PAGE>

                               EXHIBIT 5(f)(ii)(B)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                     PATENTS

United States Patent and Trademark Office

         Please be advised that pursuant to the Security Agreement dated as of
October 4, 2000 (the "Security Agreement") by and among the Obligors party
thereto (each a "Obligor" and collectively, the "Obligors") and Bank of America,
N.A., as Collateral Agent (the "Collateral Agent") for the Lenders referenced
therein (the "Lenders"), the undersigned Obligor has granted a continuing
security interest in and continuing lien upon, the patents and patent
applications shown below to the Collateral Agent for the ratable benefit of the
Lenders:

                                     PATENTS

<TABLE>
<CAPTION>
                              Description of Patent                 Date of
Patent No.                            Item                          Patent
----------                            ----                          ------
<S>                           <C>                                   <C>
</TABLE>

                              Patent Applications

<TABLE>
<CAPTION>
    Patent                                                      Date of Patent
Applications No.                                                 Applications
----------------                                                 ------------
<S>                                                             <C>
</TABLE>

<PAGE>

         The Obligors and the Collateral Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing patents and
patent applications (i) may only be terminated in accordance with the terms of
the Security Agreement and (ii) is not to be construed as an assignment of any
patent or patent application.

                                    Very truly yours,

                                    ____________________________________
                                    [Obligor]

                                    By:_________________________________
                                    Name:_______________________________
                                    Title:______________________________

Acknowledged and Accepted:

BANK OF AMERICA, N.A.,
as Collateral Agent

By:_________________________________
Name:_______________________________
Title:______________________________

<PAGE>

                               EXHIBIT 5(f)(ii)(C)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                   TRADEMARKS

United States Patent and Trademark Office

         Please be advised that pursuant to the Security Agreement dated as of
October 4, 2000 (the "Security Agreement") by and among the Obligors party
thereto (each a "Obligor" and collectively, the "Obligors") and Bank of America,
N.A., as Collateral Agent (the "Collateral Agent") for the Lenders referenced
therein (the "Lenders"), the undersigned Obligor has granted a continuing
security interest in and continuing lien upon, the trademarks and trademark
applications shown below to the Collateral Agent for the ratable benefit of the
Lenders:

                                   TRADEMARKS

<TABLE>
<CAPTION>
                              Description of Trademark              Date of
Trademark Registration No.             Item                        Trademark
--------------------------             ----                        ---------
<S>                           <C>                                  <C>
</TABLE>

                             Trademark Applications

<TABLE>
<CAPTION>
  Trademark                   Description of Trademark         Date of Trademark
Applications No.                     Applied For                  Applications
----------------                     -----------                  ------------
<S>                           <C>                              <C>
</TABLE>

<PAGE>

         The Obligors and the Collateral Agent, on behalf of the Lenders, hereby
acknowledge and agree that the security interest in the foregoing trademarks and
trademark applications (i) may only be terminated in accordance with the terms
of the Security Agreement and (ii) is not to be construed as an assignment of
any trademark or trademark application.

                                    Very truly yours,

                                    ____________________________________
                                    [Obligor]

                                    By:_________________________________
                                    Name:_______________________________
                                    Title:______________________________

Acknowledged and Accepted:

BANK OF AMERICA, N.A.,
as Collateral Agent

By:_________________________________
Name:_______________________________
Title:______________________________

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