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EXHIBIT 4.1    
  

SHARES

PINNACLE AIRLINES CORP. 

INCORPORATED
UNDER THE LAWS OF THE STATE OF DELAWARE 

CUSIP

SEE REVERSE FOR CERTAIN DEFINITIONS 

This
is to Certify that 

is
the owner of 

FULLY
PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK

$0.01
PAR VALUE PER SHARE OF PINNACLE AIRLINES CORP. transferable on the books of the Corporation by the holder hereof in person or by duly authorized Attorney, on surrender of this Certificate
properly endorsed. This Certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar. 

        IN
WITNESS WHEREOF, the Corporation has caused this Certificate to be signed in facsimile by its duly authorized officers and the facsimile seal of the Corporation to be duly affixed
hereto. 

Dated:

Countersigned
and Registered:

U.S. BANK, N.A.

(Milwaukee, WI) 

Transfer
Agent

and Registrar

By

Authorized Signature 

PRESIDENT &
CHIEF EXECUTIVE OFFICER 

VICE
PRESIDENT & CHIEF FINANCIAL OFFICER 

PINNACLE
AIRLINES CORP. 

        The
certificate also evidences and entitles the holder hereof to certain rights (the "Rights") as set forth in a Rights Agreement (the "Rights Agreement"), the terms of which are hereby
incorporated herein by reference and copy of which is on file at the principal executive offices of Pinnacle Airlines Corp. Under certain circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate cerfificates and will no longer be evidenced by this certificate. Pinnacle Airlines Corp. will mail to the holder of this certificate a copy of the Rights
Agreement without charge after receipt of a written request. As described in the Rights Agreement, Rights beneficially owned by an Acquiring Person or an Affiliate or Associate of an Acquiring Person
(as such terms are defined in the Rights Agreement) shall become null and void. 

        The
following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or
regulations: 

TEN
COM

TEN ENT

JT TEN 

as
tenants in common

as tenants by the entireties

as joint tenants with right of

survivorship and not as tenants

in common 

	UNIF GIFT MIN ACTD	 	Custodian	 	 	 	 
	 	 	 	 	(Cust)	 	 
	(Minor)	 	 	 	 	 	 
	 	 	under Uniform Gifts to Minors Act
	 	 	 	 	 	 	(State)

        Additional
abbreviations may also be used though not in the above list. 

FOR
VALUE RECEIVED,
                                         
       hereby sell, assign and transfer unto 

PLEASE
INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE 

Please
print or typewrite name and address including postal zip code of assignee. 

shares 

of
the Common Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint 

Attorney

to
transfer the said stock on the books of the within named Corporation, with full power of substitution in the premises. 

Dated            .

NOTICE:

THE
SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. 

SIGNATURE(S)
GUARANTEED: 

        THE
SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. 

        KEEP
THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR DESTROYED, THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION OF THE ISSUANCE OF A REPLACEMENT CERTIFICATE. 

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Exhibit 4.2    
  

FORM OF

RIGHTS AGREEMENT

Dated            , 2002

between

Pinnacle Airlines Corp.

and

U.S. Bank, N.A.,

as Rights Agent  

  

 
 

TABLE OF CONTENTS    
  

	 
	 	 
	 	Page
 

	SECTION 1.	 	Certain Definitions	 	1
	SECTION 2.	 	Appointment of Rights Agent	 	4
	SECTION 3.	 	Issue of Right Certificates	 	5
	SECTION 4.	 	Form of Right Certificates	 	6
	SECTION 5.	 	Countersignature and Registration	 	6
	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	 	7
	SECTION 8.	 	Cancellation and Destruction of Right Certificates	 	8
	SECTION 9.	 	Availability of Shares of Preferred Stock	 	9
	SECTION 10.	 	Preferred Stock Record Date	 	10
	SECTION 11.	 	Adjustment of Purchase Price, Number of Shares and Number of Rights	 	10
	SECTION 12.	 	Certificate of Adjusted Purchase Price or Number of Shares	 	17
	SECTION 13.	 	Consolidation, Merger or Sale or Transfer of Assets or Earnings Power	 	17
	SECTION 14.	 	Fractional Rights and Fractional Shares	 	21
	SECTION 15.	 	Rights of Action	 	22
	SECTION 16.	 	Agreement of Right Holders	 	22
	SECTION 17.	 	Right Certificate Holder Not Deemed a Stockholder	 	23
	SECTION 18.	 	Concerning the Rights Agent	 	23
	SECTION 19.	 	Merger or Consolidation or Change of Name of Rights Agent	 	23
	SECTION 20.	 	Duties of Rights Agent	 	24
	SECTION 21.	 	Change of Rights Agent	 	26
	SECTION 22.	 	Issuance of New Right Certificates	 	26
	SECTION 23.	 	Redemption	 	27
	SECTION 24.	 	Exchange	 	27
	SECTION 25.	 	Notice of Certain Events	 	28
	SECTION 26.	 	Notices	 	29
	SECTION 27.	 	Supplements and Amendments	 	30
	SECTION 28.	 	Successors	 	30
	SECTION 29.	 	Benefits of this Agreement	 	30
	SECTION 30.	 	Severability	 	30
	SECTION 31.	 	Governing Law	 	30
	SECTION 32.	 	Counterparts	 	31
	SECTION 33.	 	Descriptive Headings	 	31
	
EXHIBITS	
 	

 
	Exhibit A	 	Form of Certificate of Designations of Series B Preferred Stock	 	 
	Exhibit B	 	Form of Rights Certificate	 	 

i

 
 

RIGHTS AGREEMENT    
  

        THIS RIGHTS AGREEMENT is
dated                        , 2002 and is between Pinnacle Airlines Corp., a Delaware
corporation (the "Company"), and U.S. Bank, N.A., a [            ] corporation, as rights agent (the  "Rights
Agent"). 

BACKGROUND  

        1.    In
connection with the consummation of an initial public offering of the Common Stock of the Company (the "Offering"),
immediately prior to such consummation NWA Inc., a direct parent of the Company and an indirect subsidiary of Northwest Airlines Corporation
("NWA"), transferred all of the outstanding stock of Pinnacle Airlines, Inc. (formerly named Express Airlines I, Inc.), the operating
subsidiary of the Company, to the Company in exchange for            shares of Common Stock of the Company, which will constitute all of the Company's outstanding Common Stock, one share of
Series A preferred stock of the Company and a $150 million note issued by the Company (the "Share Exchange"). In connection with the Share
Exchange, NWA will own    shares, or 13% of the Company's outstanding Common Stock if the over-allotment option granted to the underwriters in the offering is not exercised. If
the over-allotment option is exercised in full, NWA will not own any shares of the Company's Common Stock. 

        2.    The
Board of Directors of the Company (the "Board") has authorized and declared a dividend of one preferred share purchase
right (a "Right") for each share of Common Stock of the Company outstanding as of the effective time of the offering (the  "Record Date"), each Right
representing the right to purchase one one-hundredth (subject to adjustment) of a share of Preferred Stock (as
defined below), upon the terms and subject to the conditions contained in this agreement. The Board has also authorized and directed the issuance of one Right (subject to adjustment as described in
this agreement) with respect to each share of Common Stock that becomes outstanding between the Record Date and the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date
(as such terms are defined below), although Rights may be issued in accordance with Section 22 with respect to Common Shares that become outstanding after the Distribution Date and prior to the
Redemption Date and the Final Expiration Date. 

AGREEMENT  

        The parties agree as follows: 

        SECTION 1.    Certain Definitions.    As used in this Agreement: 

        "Acquiring Person" means, subject to the exceptions described below, any Person (as defined below), other than an Exempt Person (as
defined below), that is or becomes the Beneficial Owner (as defined below) of a number of Common Shares (as defined below) equal to 15% or more of the number of Common Shares then outstanding. The
phrase "then outstanding", when used with reference to a Person's Beneficial Ownership of Common Shares means the number of Common Shares then issued
and outstanding together with any other Common Shares not then actually issued and outstanding but which such Person would be deemed to Beneficially Own. These are the exceptions referred to above: 

          (i)  A
Person will not be deemed to be or to have become an Acquiring Person for any purposes of this Agreement if the Board determines in good faith that such 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 number of Common Shares
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 Shares 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, and such Person, as promptly as practicable divested
or divests himself or itself of Beneficial Ownership of a sufficient number of Common Shares so that such Person would no longer be an Acquiring Person. 

 

        (ii)  A
Person will not be deemed to be or to have become an Acquiring Person for any purposes of this Agreement as the result of an acquisition of Common Shares by the
Company which, by reducing the number of shares outstanding, increases the proportionate number of Common Shares beneficially owned by such Person to 15% or more of the number of Common Shares then
outstanding, unless such person subsequently becomes the Beneficial Owner of any additional Common Shares and remains the Beneficial Owner of a number of Common Shares equal to 15% or more of the
number of Common Shares then outstanding. 

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

        A
Person will be deemed the "Beneficial Owner" of, will be deemed to have "Beneficial
Ownership" of and will be deemed to "beneficially own": 

          (i)  any
securities that 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 under the Exchange Act, as in effect on the date of this Agreement; 

        (ii)  any
securities that such Person or any of such Person's Affiliates or Associates has the right to acquire (whether such right is exercisable immediately or only after
the passage of time) in accordance with 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), or upon the exercise of conversion rights, exchange rights, rights, warrants or options, or otherwise, but not including (A) securities tendered pursuant to a
tender or exchange offer made by or on behalf of such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for purchase, (B) 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 (C) 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 prior to the Distribution Date or pursuant to Section 3(a)
or Section 22 ("original Rights") or pursuant to Section 11(a)(i) or Section 11(n) with respect to an adjustment to original
Rights; or 

        (iii)  any
securities that such Person or any of such Person's Affiliates or Associates has the right to vote in accordance with any agreement, arrangement or understanding,
unless the agreement, arrangement or understanding to vote such security 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 is not also then reportable on Schedule 13D under the Exchange Act (or any
comparable or successor report); 

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

        (v)  any
securities of the Company convertible into Common Shares held by such Person. 

        "Business Day" means 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. 

2

 

        "close of business" on any given date means 5:00 P.M., New York City time, on such date; provided,
however, that if such date is not a Business Day it means 5:00 P.M., New York City time, on the next succeeding Business Day. 

        "Common Shares" means the Company's Common Stock, par value $.01 per share. 

        "Common Stock" when used with reference to any Person other than the Company means 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. 

        "Distribution Date" means 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 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 becoming the Beneficial Owner of a number of Common Shares equal to 15% or more of the number of Common Shares then outstanding (including any such date which is after the date of this
Agreement and prior to the issuance of the Rights. 

        "Effective Time of the Offering" means the time and date of the initial closing under the underwriting agreement relating to the Offering. 

        "Exempt Person" means (i) the Company, (ii) any Subsidiary (as defined below) of the Company, (iii) any employee
benefit plan of the Company or of any Subsidiary of the Company or any entity or trustee holding Common Shares 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, (iv) Northwest Airlines Corporation, a Delaware corporation, and any of its successors, and
(v) any Affiliate of Northwest Airlines Corporation. 

        "Final Expiration Date" has the meaning given in Section 7. 

        "NASDAQ" means The Nasdaq Stock Market's National Market. 

        "Person" means any individual, firm, corporation or other entity, including any successor (by Offering or otherwise) of such entity. 

        "Preferred Stock" means the Series B 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 Agreement as Exhibit A. 

        "Redemption Date" has the meaning given in Section 7. 

        "Securities Act" means the Securities Act of 1933, as amended. 

        "Stock Acquisition Date" means the first date of public announcement (which for purposes of this definition includes, without limitation,
a report filed pursuant to Section 13(d) of the Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has become such or such earlier date as a majority of the Board
becomes aware of the existence of an Acquiring Person. 

        "Subsidiary" of any Person" means 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. 

        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, prior to the Distribution Date are also the holders of the Common Shares) in accordance with the terms and 

3

 

conditions of this Agreement, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such co-Rights Agents as it may deem necessary or desirable. 

        SECTION 3.    Issue of Right Certificates.    

        (a)  Until
the Distribution Date (i) the Rights will be evidenced (subject to the provisions of Section 3(b)) by the certificates for Common Shares registered
in the names of the holders thereof and not by separate Right Certificates, and (ii) the Rights will be transferable only in connection with the transfer of the Common Shares. 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 Shares 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 Common Share so held. As of the Distribution Date, the Rights will be evidenced solely by such Right Certificates. 

        (b)  On
the Record Date, or as soon as practicable thereafter, 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 record holder of Common Shares 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 certificates for Common Shares outstanding as of the Record Date, until the Distribution Date, the Rights will be evidenced by such certificates registered in the names of the holders thereof
together with the Summary of Rights. Until the Distribution Date (or the earlier of the Redemption Date or the Final Expiration Date), the surrender for transfer of any certificate for Common Shares
outstanding on the Record Date, with or without a copy of the Summary of Rights, will also constitute the transfer of the Rights associated with the Common Shares represented thereby. 

        (c)  Certificates
issued for Common Shares after the Record Date but prior to the earliest of the Distribution Date, the Redemption Date or the Final Expiration Date will
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 PINNACLE AIRLINES CORP. AND U.S. BANK, N.A.,
DATED                        , 2002 AS
THE SAME MAY BE AMENDED FROM TIME TO TIME (THE "RIGHTS AGREEMENT"), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH
IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF PINNACLE AIRLINES CORP. 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. PINNACLE AIRLINES CORP. WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST
THEREFORE. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO 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 Shares represented by such certificates will be evidenced by such
certificates alone, and the surrender for transfer of any such certificate, except as otherwise provided 

4

 

herein, will also constitute the transfer of the Rights associated with the Common Shares represented thereby. In the event that the Company purchases or otherwise acquires any Common Shares after
the Record Date but prior to the Distribution Date, any Rights associated with such Common Shares will be deemed cancelled and retired so that the Company will not be entitled to exercise any Rights
associated with the Common Shares which are no longer outstanding. 

        (d)  Notwithstanding
Section 3(c), the omission of a legend will not affect the enforceability of any part of this 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) will be substantially in the form set forth in Exhibit B hereto and may have such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable law
or with any rule or regulation made pursuant thereto or with any rule or regulation of NASDAQ 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, 13 and 22, the Right Certificates will entitle the holders thereof to purchase such number of one one-hundredths
of a share of Preferred Stock as shall be set forth therein at the price per one one-hundredth of a share of Preferred Stock set forth therein (the "Purchase
Price"), but the number of such one one-hundredths of a share of Preferred Stock and the Purchase Price will be subject to adjustment as provided in this Agreement. 

        SECTION 5.    Countersignature and Registration.    (a) The Right Certificates will be executed on behalf of
the Company by the President, any of the Vice Presidents, the Treasurer or the Controller of the Company, either manually or by facsimile signature, and will be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by facsimile signature. The Right Certificates must be manually countersigned by the Rights Agent and will not be valid for any purpose unless
countersigned. In case any officer of the Company who has signed any of the Right Certificates ceases 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, was a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such Person was not such an officer. 

        (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 will 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 Sections 7(e), 11(a)(ii) and 14, at any time after the close of business on the Distribution Date, and prior to the close of business
on the earlier of the Redemption Date or the Final 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-hundredths of a share of Preferred Stock 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 will make such request in writing delivered
to the Rights Agent, and will surrender the Right 

5

 

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 will
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 Section 11(a)(ii), at any time after the Distribution Date and prior to the close of business on the earlier of the Redemption Date
or the Final 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 will become exercisable on the Distribution Date, and thereafter the registered holder of any Right Certificate may,
subject to Section 11(a)(ii) 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-hundredth of a share of Preferred Stock as to which the Rights are exercised, at any time which is both after the Distribution Date and prior to the earliest of
(i) the close of business on                        , 2012 (the "Final Expiration
Date"), (ii) the time at which the
Rights are redeemed as provided in Section 23 (the "Redemption Date") or (iii) the time at which such Rights are exchanged as provided in
Section 24. 

        (b)  The
Purchase Price will be initially $    for each one one-hundredth of a share of Preferred Stock purchasable upon the exercise of a Right. The
Purchase Price and the number of one one-hundredths of a share of Preferred Stock or other securities or property to be acquired upon exercise of a Right will be subject to adjustment from
time to time as provided in Sections 11 and 13 and will be payable in lawful money of the United States of America in accordance with paragraph (c) of this Section 7. 

        (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 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 9, in cash or by certified check, cashier's check or money order payable to the order of the Company, the Rights Agent will 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 depositary receipts representing interests in such number of one one-hundredths of a
share of Preferred Stock as are to be purchased (in which case certificates for the Preferred Stock represented by such receipts will 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, (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 

6

 

(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 exercises less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the exercisable Rights remaining unexercised will 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. 

        (e)  Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the Company will 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 or this Section 7 unless such registered holder has
(i) completed and signed the certificate contained in the form of assignment or election to purchase set forth on the reverse side of the Rights 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 will, 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, will be cancelled by it, and no Right Certificates will be issued in lieu thereof except as expressly permitted by any of the provisions of this Agreement. The
Company will deliver to the Rights Agent for cancellation and retirement, and the Rights Agent will so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise
than upon the exercise thereof. The Rights Agent will deliver all cancelled Right Certificates to the Company. 

        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, Common Shares and other securities) issuable upon the
exercise of Rights may be listed or admitted to trading on NASDAQ or listed on any other national securities exchange or quotation system, the Company will 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 NASDAQ 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 will 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, Common Shares 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, Common Shares 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 the date as of which the Rights are no longer exercisable for such securities and the Final Expiration Date. The Company may temporarily suspend, for a period of time
not to exceed 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 will issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement 

7

 

at such time as the suspension is no longer in effect. Notwithstanding any provision of this Agreement to the contrary, the Rights will not be exercisable in any jurisdiction unless the requisite
qualification in such jurisdiction is obtained and until a registration statement under the Securities Act (if required) is 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, Common Shares and other securities) delivered upon exercise of Rights will, 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 Common Shares or other securities) upon the exercise of Rights. The Company will not, however, be required
to pay any transfer tax which may be payable in respect of any transfer or delivery of Right Certificates to a Person other than, or the issuance or delivery of certificates or depositary receipts for
the Preferred Stock (or Common Shares 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 Common Shares or other securities) upon the exercise of any Rights until any such tax will have been paid (any such tax 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 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 will for all purposes be deemed to have become the holder of record of the shares of Preferred Stock represented thereby on, and such certificate will 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) 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 will be deemed to have become the record holder of such shares on, and such
certificate will be dated, the next succeeding Business Day on which the Preferred Stock transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a
Right Certificate will not be entitled to any rights of a holder of Preferred Stock for which the Rights will be exercisable, including, without limitation, the right to vote or to receive dividends
or other distributions, and will not be entitled to receive any notice of any proceedings of the Company, except as provided herein. 

        SECTION 11.    Adjustment of Purchase Price, Number 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 as provided in this
Section 11. 

        (a)  (i)
In the event the Company at any time after the date of this Agreement (A) declares a dividend on the Preferred Stock payable in shares of Preferred Stock,
(B) subdivides the outstanding Preferred Stock, (C) combines the outstanding Preferred Stock into a smaller number of Preferred Stock or (D) issues any shares of its capital stock
in a reclassification of the Preferred Stock (including any such reclassification in connection with a consolidation or Offering 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, and the number and kind of shares of capital stock issuable on such
date, will be proportionately adjusted so that the holder of any Right exercised after such time will be entitled to receive the same number and kind of shares 

8

 

of capital stock which were available to the holder prior to such dividend, subdivision, combination or reclassification. The consideration to be paid upon the exercise of one Right will not 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 Agreement and except as otherwise provided in this Section 11(a)(ii), in the event any Person becomes an Acquiring Person,
each holder of a Right will have the right to receive, upon its exercise at a price equal to the then current Purchase Price multiplied by the number of one one-hundredths of a share of
Preferred Stock for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of shares of Preferred Stock, such number of Common Shares (or at the option of the
Company, such number of one one-hundredths of shares of Preferred Stock) obtained by: 

        (A)  multiplying
the then current Purchase Price by the number of one one-hundredths of a share of Preferred Stock for which a Right is then exercisable and
dividing that product by (B) 50% of the then current per share market price of the Company's Common Shares (determined pursuant to Section 11(d)) on the date of the occurrence of such
event; and from such date forward the Purchase Price and the number of Common Shares so receivable upon exercise of a Right will be subject to further adjustment as appropriate in accordance with
Section 11(f) below. 

Notwithstanding
anything in this 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 (A) any Acquiring Person (or any Affiliate or Associate of any Acquiring Person), (B) a transferee of any Acquiring Person (or
any such Affiliate or Associate) who becomes a transferee after the invalidation time or (C) 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 regarding the transferred Rights or (II) a transfer which the Board has determined is part of a plan, arrangement or understanding which has
the purpose or effect of avoiding the provisions of this paragraph, and subsequent transferees of such Persons, will be void without any further action and any holder of such Rights will thereafter
have no rights whatsoever with respect to such Rights under any provision of this Agreement. The Company will use all reasonable efforts to ensure that the provisions of this
Section 11(a)(ii) are complied with, but will 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 will be issued pursuant to Section 3 or Section 6
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 will be cancelled. From and after the occurrence of an event specified in Section 13(a), any Rights that have not been exercised pursuant to
this Section 11(a)(ii) will be exercisable only in accordance with Section 13 and not pursuant to this Section 11(a)(ii). 

9

  

        (iii)  The
Company may substitute for a Common Share 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 Common Shares. In the event that there are insufficient Common Shares issued but
not outstanding or authorized but unissued to permit the exercise in full of the Rights in accordance with the foregoing subparagraph (ii), the Board will, 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 (1) the value of the Common Shares issuable upon the exercise of a Right in
accordance with the foregoing subparagraph (ii) (the "Current Value") over (2) the then current Purchase Price multiplied by the number of
one one-hundredths 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 Common Shares issuable in accordance with subparagraph (ii) upon exercise of the Right and payment of the applicable Purchase Price, (1) cash,
(2) a reduction in the 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 Common Shares, are deemed in good faith by the Board to have substantially the same
value as the Common Shares ("Common Share 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 Common Shares actually issued upon exercise of such Right, will have an aggregate value equal to the Current Value
(less the amount of any reduction in the Purchase Price), where such aggregate value has been determined by the Board upon the advice of a nationally recognized investment banking firm selected in
good faith by the Board; but, if the Company does 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 will 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, Common Shares (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, upon the date any Person becomes an Acquiring Person, the Board determines that it is likely that sufficient additional Common Shares could be authorized for issuance upon exercise
in full of the Rights, then, if the Board so elects, the thirty (30) day period set forth above may be extended to the extent necessary, but not more than ninety (90) days after the
Section 11(a)(ii) Trigger Date, in order that the Company may seek stockholder approval for the authorization of such additional shares (such thirty (30) day period, as it may be
extended, is 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 (A) will provide, subject to Section 11(a)(ii) and the last sentence of this Section 11(a)(iii), that such
action will apply uniformly to all outstanding Rights and (B) 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 determine the value of the Rights and their form of distribution. In the event of any such suspension, the Company will issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of the Common Shares will 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 Share equivalent" will be deemed to equal the current
per share market price of the Common Shares. The Board may, but will not be 

10

 

required to, establish procedures to allocate the right to receive Common Shares upon the exercise of the Rights among holders of Rights pursuant to this Section 11(a)(iii). 

        (b)  Issuance of Rights, Options or Warrants to Purchase Preferred Stock or its Equivalent. If the Company fixes 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 the same 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) below)
on such record date, the Purchase Price to be in effect after such record date will be determined by: 

        (A)  multiplying
the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which will 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
shares of Preferred Stock and/or equivalent preferred shares so to be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such
current market price, and the denominator of which will 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). 

The
consideration to be paid upon the exercise of one Right will not 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 is paid in a form other than cash, the value will be determined by the Board, whose determination will 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 will not be deemed outstanding for the purpose of any such
computation. Such adjustment will 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 will be
adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed. 

        (c)  Issuance of Bonds, Assets, Rights or Warrants (excluding those referred to in Section 11(b)). If the Company fixes
a record date for 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 payable in Preferred Stock) or subscription rights or warrants (excluding those referred to in Section 11(b)), the Purchase Price to be in effect after such record date
will be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which will be the then current per share market price of the
Preferred Stock (determined pursuant to Section 11(d) below) on such record date, less the fair market value (as determined by the Board whose determination will be described in a statement
filed with the Rights Agent) of the portion of the assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants applicable to one share of Preferred Stock, and
the denominator of which will be such current per share market price (determined pursuant to Section 11(d) below) of the Preferred Stock; in no event will what is 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 will be made successively whenever such a record date
is fixed; and in the event that such 

11

 

distribution is not so made, the Purchase Price will again be adjusted to be the Purchase Price that would then be in effect if such record date had not been fixed. 

        (d)  Current Per Share Market Price.

          (i)  Except
as otherwise provided the "current per share market price" of any security (a  "Security" for the purpose of this Section 11(d)(i)) will be deemed to
be the average of the daily closing prices per share of such Security for
the 30 consecutive Trading Days (defined below) immediately prior to such date. In the event that the current per share market price of the Security is determined following the announcement 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 will be appropriately adjusted to reflect the current market price per share equivalent of such Security. The closing
price for each day will 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 the principal consolidated transaction reporting system with respect to securities on NASDAQ or, if the Security is not on NASDAQ, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading
on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market or such other
system then in use, or, if on any such date the Security is not quoted by any organization in the over-the-counter market, 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 the Company. The term "Trading Day"means 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. 

        (ii)  If
the Preferred Stock is publicly traded, the "current per share market price" of the Preferred Stock will 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 Shares are publicly traded, the  "current per share market price"
of the Preferred Stock will be conclusively deemed to be the current per share market price of
the Common Shares as determined pursuant to Section 11(d)(i) multiplied by one hundred (appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring
after the date hereof). If neither the Common Shares nor the Preferred Stock is publicly traded, "current per share market price" means the fair value
per share as determined by the Board and described in a statement to be filed with the Rights Agent. 

        (e)  Minimum Threshold. No adjustment in the Purchase Price will be required unless such adjustment would require an increase
or decrease of at least 1% in the Purchase Price; and any adjustments which by reason of this Section 11(e) are not required to be made will be carried forward and taken into account in any
subsequent adjustment. All calculations under this Section 11 will be made to the nearest cent or to the nearest one ten-thousandth of a share of Preferred Stock or Common Share or
other share or security as the case may be. Any adjustment required by this Section 11 will be made no later than the earlier of (A) three years from the date of the transaction which
requires such adjustment or (B) the date of the expiration of the right to exercise any Rights. 

        (f)    Capital Stock. If as a result of an adjustment made pursuant to Section 11(a), the holder of any Right that is
exercised will 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 will be subject to adjustment from time to time in a manner and on 

12

 

terms as nearly equivalent as practicable to the provisions with respect to the Preferred Stock contained in Sections 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 with respect to the Preferred Stock will apply on like terms to any such other shares. 

        (g)  Fractions of Preferred Stock. All Rights issued by the Company subsequent to any adjustment made to the Purchase Price
evidences the right to purchase, at the adjusted Purchase Price, one one-hundredths of a share of Preferred Stock purchasable upon exercise of the Rights, all subject to further adjustment
as provided below. 

        (h)  Number of Preferred Stock Purchaseable in Event of Adjustment. If the Company does not exercise its election as provided
in Section 11(i), then upon each adjustment of the Purchase Price as a result of the calculations made in Sections 11(b) and (c), each Right outstanding immediately prior to the making of such
adjustment will evidence the right to purchase, at the adjusted Purchase Price, that number of one one-hundredths of a share of Preferred Stock (calculated to the nearest one
ten- thousandth of a share of Preferred Stock) obtained by (A) multiplying (1) the number of one one-hundredths of a share covered by a Right immediately prior to
such adjustment by (2) the Purchase Price in effect immediately prior to such adjustment of the Purchase Price and (B) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price. 

        (i)    Adjustment to Number of Rights. The Company may elect on or after the date of any adjustment of the Purchase Price to
adjust the number of Rights, in substitution for any adjustment in the number of one one-hundredths 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 will be exercisable for the number of one one-hundredths 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 will be calculated (to the nearest one ten-thousandth) by
(A) dividing the Purchase Price in effect immediately prior to its adjustment by the Purchase Price in effect immediately after its adjustment. The Company will publicly announce such election,
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, will 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 distribute to holders of record of Right Certificates on such record date Right Certificates evidencing,
subject to Section 14, the additional Rights to which such holders are entitled as a result of such adjustment, or, at the option of the Company, will distribute 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 will be entitled after such adjustment. Right Certificates so to be distributed will be issued, executed and countersigned in the manner provided for in this
Agreement and will be registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement. 

        (j)    Ratios and Purchase Price of New Rights Certificates. Irrespective of any adjustment or change in the Purchase Price or
the number of one one-hundredths of a share of Preferred Stock issuable upon the exercise of the Rights, new Right Certificates issued may continue to express the Purchase Price and the
number of one one-hundredths of a share of Preferred Stock which were expressed in the initial Right Certificates. 

        (k)  Purchase Price below Par Value. Before taking any action that would cause an adjustment reducing the Purchase Price below
the then par value, if any, of the Preferred Stock or other shares of capital stock issuable upon exercise of the Rights, the Company will validly and legally issue fully paid and nonassessable shares
of Preferred Stock or other such shares at such adjusted Purchase Price. 

13

 

        (l)    Deferral. In any case in which this Section 11 requires that an adjustment in the Purchase Price be made effective
as of a record date for a specified event, the Company may defer issuing any additional Preferred Stock and other capital stock or securities of the Company until the occurrence of such specified
event. The Company will 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)  Reductions in Purchase Price to Avoid Taxation. Anything in this Section 11 to the contrary notwithstanding, the
Company will be entitled to make reductions in the Purchase Price, in addition to those adjustments expressly required by this Section 11, 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 or 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 above in Section 11(b), made by the Company to holders of its Preferred Stock will not be taxable to such stockholders. 

        (n)  Purchase Price Adjustment for Dividends on, or Subdivision, Combination or Reclassification of, Preferred Stock. Anything
in this Agreement to the contrary notwithstanding, in the event that at any time after the date of this Agreement and prior to the Distribution Date, the Company (i) declares or pays any
dividend on the Common Shares payable in Common Shares or (ii) effects a subdivision, combination or consolidation of the Common Shares (by reclassification or otherwise than by payment of a
dividend payable in Common Shares) into a greater or lesser number of Common Shares, then in any such case, the number of Rights associated with each Common Share then outstanding, or issued or
delivered thereafter, will be proportionately adjusted so that the number of Rights associated with each Common Share following any such event will equal the result obtained by: 

        (A)  multiplying
the number of Rights associated with each Common Share immediately prior to such event by a fraction (1) the numerator of which will be the total
number of Common Shares outstanding immediately prior to the occurrence of the event and (2) the denominator of which will be the total number of Common Shares 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, 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, the Company will 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 Shares or the Preferred Stock a copy of such certificate and (c) mail a brief summary to each holder of a Right
Certificate in accordance with Section 25 (if so required under Section 25). The Rights Agent will be fully protected in relying on any such certificate and on any adjustment therein
contained and will not be deemed to have knowledge of any such adjustment unless and until it receives 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 merges with and into any other Person,
(ii) any Person consolidates with the Company, or any Person merges with and into the Company and the Company is the continuing or surviving corporation of such merger and, in connection with
such merger, all or part of the Common Shares are 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 sells or otherwise transfers (or one or more of its Subsidiaries sells or otherwise transfers), in one or more transactions, assets or earning 

14

 

power aggregating 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 upon the first occurrence of such event: 

        (A)  each
holder of record of a Right (other than Rights which have become void pursuant to Section 11(a)(ii)) will have the right to receive, upon its exercise at a
price equal to the then current Purchase Price multiplied by the number of one one-hundredths 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 Sections 11(a)(i), 11(b), 11(c), 11(h),
11(i) and 11(m)), in accordance with the terms of this Agreement and in lieu of Preferred Stock, validly issued, fully paid and non-assessable and freely tradeable shares of Common
Stock of the Principal Party (as defined in this Agreement) free from any liens, encumbrances, rights of first refusal or other adverse claims. This amount will be determined by: 

        (1)  multiplying
the then current Purchase Price by the number of one one-hundredths 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 Sections 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)) on
the date of consummation of such consolidation, merger, sale or transfer; and the Purchase Price and the number of shares of Common Stock of such Principal Party issuable upon exercise of each Right
will be further adjusted as provided in Section 11(f) of this Agreement to reflect any events occurring in respect of such Principal Party after the date of the such consolidation, merger, sale
or transfer; (B) such Principal Party will thereafter be liable for, and will assume, by virtue of such consolidation, merger, sale or transfer, all the obligations and duties of the Company
pursuant to this Agreement; (C) the term "Company" will thereafter be deemed to refer to such Principal Party; and (D) such Principal
Party will take such steps (including, but not limited to, the reservation of a sufficient number of its shares of Common Stock in accordance with Section 9) in connection with such
consummation of any such transaction as may be necessary to assure that the provisions will 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 will 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 will 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 for such cash, shares, rights, warrants and other property. 

        (b)  "Principal Party" means: 

          (i)  in
the case of any transaction described in (i) or (ii) of the first sentence of Section 13(a): (A) the Person that is the issuer of the
securities into which the shares of Common Shares are converted in such merger or consolidation, or, if there is more than one such issuer, the issuer the shares of Common Stock of which have the
greatest aggregate market value of shares outstanding, or (B) if no securities are so issued, (1) 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 (2) if 

15

 

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 (3) 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), 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 as 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" will 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" will 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 rules
set forth in clauses (1) and (2) above will 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 will 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 will not consummate any consolidation, merger, sale or transfer referred to in Section 13(a) unless prior thereto the Company and the Principal Party
involved therein executes and delivers to the Rights Agent an agreement confirming that the requirements of Sections 13(a) and (b) will promptly be performed in accordance with their terms and
that such consolidation, merger, sale or transfer of assets will not result in a default by the Principal Party under this Agreement as the same
shall have been assumed by the Principal Party pursuant to Sections 13(a) and (b) 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 Final Expiration Date, and similarly comply with applicable state
securities laws; 

        (ii)  use
its best efforts, if the Common Stock of the Principal Party is listed or admitted to trading on NASDAQ 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 NASDAQ or such securities exchange, or, if the Common Stock of the Principal Party is
not listed or admitted to trading on NASDAQ 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 

16

 

        (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 corporate 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 of such Principal Party at less than the then current market
price per share thereof (determined pursuant to Section 11(d)) or securities exercisable for, or convertible into, Common Stock of such Principal Party at less 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 will not consummate any such transaction unless prior thereto the Company and such Principal Party
executes and delivers to the Rights Agent a supplemental agreement providing that the provision in question of such Principal Party shall have been cancelled, 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 will not, at any time after a Person first becomes an Acquiring Person, enter into any transaction of the type contemplated by
(i)—(iii) of Section 13(a) if (1) 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, (2) prior to,
simultaneously with or immediately after such consolidation, merger, sale, transfer of other transaction, the stockholders of the Person who constitutes, or would constitute, the Principal Party for
purposes of Section 13(a) shall have received a distribution of Rights previously owned by such Person or any of its Affiliates or Associates or (3) 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 will not be required to issue fractions of Rights or to distribute Right Certificates that 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 will 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 will be the last sale price, regular way, or, in case no such sale takes place on
such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or
admitted to trading on NASDAQ or, if the Rights are not listed or admitted to trading on NASDAQ, as reported in the principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the Rights are listed or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange,
the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by any system then in use or, if on any
such date the Rights are not quoted by any organization in the over-the-counter market, 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 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 the Company will be used. 

17

 

        (b)  The
Company will not be required to issue fractions of Preferred Stock (other than fractions which are integral multiples of one one-hundredth 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-hundredth of a share of Preferred Stock). Interests in fractions of Preferred Stock in integral multiples of one one-hundredth 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; such agreement must provide that the holders of
such depositary receipts 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-hundredth of a share of Preferred Stock, the Company will pay to the registered holders of Right Certificates at the
time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one share of Preferred Stock. For the purposes of this
Section 14(b), the current market value of a share of Preferred Stock will be the closing price of a share of Preferred Stock (as determined pursuant to Section 11(d)(i)) for the Trading
Day immediately prior to the date of such exercise. 

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

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

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

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

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

        (c)  the
Company and the Rights Agent may deem and treat the Person in whose name the Right Certificate (or, prior to the Distribution Date, the Common Share certificate) is
registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificates or the Common Share certificate made by
anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent will be affected by any notice to the contrary. 

18

   
        SECTION 17.    Right Certificate Holder Not Deemed a Stockholder.    No holder, as such, of any Right Certificate
will
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 of the
Rights represented thereby, nor will 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 Agreement), or to receive dividends or subscription rights, or otherwise, until the Rights evidenced by
such Right Certificate is exercised in accordance with the provisions hereof. 

        SECTION 18.    Concerning the Rights Agent.    

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

        (b)  The
Rights Agent will be protected and will incur no liability for, or in respect of any action taken, suffered or omitted by it in connection with, its administration
of this Agreement in reliance upon any Right Certificate or certificate for the Preferred Stock or Common Shares or for other securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or other paper or document 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. 

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

        (b)  In
case at any time the name of the Rights Agent is 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 will have the full force provided in the Right
Certificates and in this Agreement. 

19

 

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

        (b)  Whenever
in the performance of its duties under this Agreement the Rights Agent deems 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 President, the Chief Financial Officer or the Secretary of the Company and delivered to the Rights Agent; and such certificate will be full
authorization to the Rights Agent for any action taken or suffered in good faith by it under the provisions of this Agreement in reliance upon such certificate. 

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

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

        (e)  The
Rights Agent will not be under any responsibility in respect of the validity of this Agreement or the execution and delivery (except the due execution by the Rights
Agent) or in respect of the validity or execution of any Right Certificate (except its countersignature thereof); nor will it be responsible for any breach by the Company of any covenant or condition
contained in this Agreement or in any Right Certificate; nor will it be responsible for any change in the exercisability of the Rights (including the Rights becoming void pursuant to
Section 11(a)(ii)) 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 will 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 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 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 President, the Chief Financial Officer or the Secretary of the Company, and to apply to such officers for advice or instructions in connection with its duties, and it
will not be liable for any action taken or suffered by it in good faith in accordance with instructions of any such 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 Agreement and the date on and/or 

20

 

after which such action will be taken or such omission will be effective. The Rights Agent will 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 will not be less than five Business Days after the date any officer of the Company actually receives
such application, unless any such officer will have consented in writing to an earlier date) unless, prior to taking any such action (or the effective date in the case of an omission), the Rights
Agent will 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 Agreement. Nothing herein will 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 will 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 Rights 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), the Rights
Agent will not take any further action with respect to such requested exercise or transfer without first consulting with the Company. 

        SECTION 21.    Change of Rights Agent.    The Rights Agent or any successor Rights Agent may resign and be discharged
from its duties under this Agreement upon 30 days' notice in writing mailed to the Company and to each transfer agent of the Common Shares or Preferred Stock by registered or certified mail,
and, following the Distribution Date, to the holders of the Right Certificates by first-class mail. The Company may remove the Rights Agent or any successor Rights Agent upon 30 days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Shares or Preferred 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 will resign or be removed or will otherwise become incapable of acting, the Company will
appoint a successor to the Rights Agent. If the Company will 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 will, 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, will be 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 state authority and which has at the time of its appointment as Rights Agent a combined
capital and surplus of at least $[50 million]. After appointment, the successor Rights Agent will 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 will 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 will file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Shares or Preferred Stock, and, following the Distribution Date, mail a notice thereof 

21

 

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, will not affect the legality or
validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be. 

        SECTION 22.    Issuance of New Right Certificates.    Notwithstanding any of the provisions of this Agreement or of
the Rights to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such forms as may be approved by its Board to reflect any adjustment or change in the
Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this Agreement. In addition,
in connection with the issuance or sale of Common Shares following the Distribution Date and prior to the earlier of the Redemption Date and the Final Expiration Date, the Company may with respect to
such Common Shares so issued or sold pursuant to (i) the exercise of stock options, (ii) under any employee plan or arrangement, (iii) upon 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 Rights Certificates
representing the appropriate number of Rights in connection with such issuance or sale. 

        SECTION 23.    Redemption.    

        (a)  The
Board 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 (the redemption price being hereinafter referred
to as 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 in
its sole discretion may establish. The Company may, at its option, pay the Redemption Price in cash, Common Shares (based on the current market price of the Common Shares at the time of redemption) or
any other form of consideration deemed appropriate by the Board. 

        (b)  Immediately
upon the action of the Board ordering the redemption of the Rights pursuant to paragraph (a) of this Section 23 (or at such later time as the
Board 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 will be to receive the Redemption Price. The Company will promptly give public notice of any such redemption. The failure to give, or any defect in, any such notice will not
affect the validity of such redemption. Within 10 days after such action of the Board ordering the redemption of the Rights (or such later time as the Board may establish for the effectiveness
of such redemption), the Company will 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 Shares. Any notice which is mailed in the manner herein provided will be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state the method by which the payment of the Redemption Price will be made. 

        SECTION 24.    Exchange.    

        (a)  The
Board 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
will not include Rights that have become void pursuant to the provisions of Section 11(a)(ii)) for Common Shares (or, at the Company's option, Preferred Stock) at an exchange ratio of one
Common Share (or one one-hundredth of a share of Preferred Stock) per Right, (such exchange ratio being hereinafter referred to as the "Exchange
Ratio"). Notwithstanding the foregoing, the Board will not be empowered to effect such exchange at any time (1) after any Person (other than an Exempt Person), together
with all Affiliates and Associates of such Person, becomes the Beneficial Owner of a number of Common Shares equal to 50% or more of the number of Common Shares then outstanding or (2) after
the occurrence of an event specified in Section 13(a). 

22

 

        (b)  Immediately
upon the action of the Board 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 will terminate and the only right thereafter of a holder of such Rights will be to receive that number of Common Shares equal to the number of
such Rights held by such holder multiplied by the Exchange Ratio. The Company will promptly give public notice of any such exchange. The failure to give, or any defect in, such notice will not affect
the validity of such exchange. The Company will 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 will be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the Common Shares for Rights will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange will 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)) held by each holder of Rights. 

        (c)  In
the event that there will not be sufficient Common Shares issued but not outstanding or authorized but unissued to permit any exchange of Rights as contemplated in
accordance with this Section 24, the Company may, in its discretion, take such action as may be necessary to authorize additional Common Shares for issuance upon exchange of the Rights. In the
event that the Company will determine not to take such action or will, after good faith effort, be unable to take such action as may be necessary to authorize such additional Common Shares, the
Company will substitute, to the extent of such insufficiency, for each Common Share that would otherwise be issuable upon exchange of a Right, a number of shares of Preferred Stock or fractions
thereof (or equivalent preferred shares as such term is defined in Section 11(b)) having an aggregate current per share market price (determined pursuant to Section 11(d)) equal to the
current per share market price of Common Shares (determined pursuant to Section 11(d)) as of the date of issuance of such shares of Preferred Stock or fractions thereof (or equivalent preferred
shares). 

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

        SECTION 25.    Notice of Certain Events.    

        (a)  In
case the Company will 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 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 Shares payable in Common Shares or to effect a subdivision, combination or consolidation of the
Common Shares (by reclassification or otherwise than by payment of dividends in Common Shares), then, in each such case, the Company will give to each holder of a Right Certificate, in accordance with
Section 26, a notice of such proposed action, which will specify the record date for the purposes of such stock dividend, or distribution of rights or warrants, or the date on which such 

23

 

liquidation, dissolution or winding up is to take place and the date of participation therein by the holders of the Common Shares and/or Preferred Stock, if any such date is to be fixed, and such
notice will 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 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 Shares and/or Preferred Stock, whichever will be the earlier. 

        (b)  In
case any event described in Section 11(a)(ii) or Section 13 will occur then the Company will 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 Shares) in accordance with Section 26, a notice of the occurrence of such event, which
notice will describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) and Section 13. 

        SECTION 26.    Notices.    Notices or demands authorized by this Agreement to be given or made by the Rights Agent or
by the holder of any Right Certificate to or on the Company will 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: 

Pinnacle
Airlines Corp.

1689 Nonconnah Blvd., Suite 111

Memphis, Tennessee 38132

Attention: Secretary 

Subject
to the provisions of Section 21, any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the Rights Agent
will 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: 

________________________

________________________ 

Notices
or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate will 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 will if the Company so directs, supplement or amend any provision of this Agreement in any
respect without the approval of any holders of the Rights. At any time when the Rights are no longer redeemable, except as otherwise provided in this Section 27, the Company may, and the Rights
Agent will, if the Company so directs, supplement or amend this Agreement without the approval of any holders of Rights 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 that no such supplement or amendment will adversely affect the interests of the holders of
Rights as such (other than an Acquiring Person or an Affiliate or Associate of an Acquiring Person), and no such amendment may cause the rights again to become redeemable or cause the Agreement again
to become amendable other than in accordance with this sentence. Notwithstanding anything contained in this Agreement to the contrary, no supplement or amendment will be made that decreases the
Redemption Price. Upon the delivery of a certificate from an appropriate officer of the Company 

24

 

which states that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent will execute such supplement or amendment. 

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

        SECTION 29.    Benefits of this Agreement.    Nothing in this Agreement will be construed to give to any Person other
than the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common Shares) any legal or equitable right, remedy or claim under
this Agreement; but this Agreement will be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Shares). 

        SECTION 30.    Severability.    If any term, provision, covenant or restriction of this Agreement or applicable to
this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this
Agreement will remain in full force and effect and will in no way be affected, impaired or invalidated. 

        SECTION 31.    Governing Law.    This Agreement and each Right Certificate issued hereunder will be deemed to be a
contract made under the laws of the State of Delaware and for all purposes will 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 32.    Counterparts.    This Agreement may be executed in any number of counterparts and each of such
counterparts will for all purposes be deemed to be an original, and all such counterparts will together constitute but one and the same instrument. 

        SECTION 33.    Descriptive Headings.    Descriptive headings of the several Sections of this Agreement are inserted
for convenience only and do not control or affect the meaning or construction of any of the provisions. 

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

	 	 	Attest:	 	 	 	/s/  PINNACLE AIRLINES CORP      
	 	 	 	 	 	 	 
	By	 	
 Name:

Title:	 	By	 	
 Name:

Title:
	 	 	 	 	 	 	 
	Attest:	 	 
	 	 	 	 	 	 	 
	By	 	
 Name:

Title:	 	By	 	
 Name:

Title:

25

  

 
 

Exhibit A    
  

FORM  

 OF  

 CERTIFICATE OF DESIGNATIONS  

 OF  

 SERIES B PREFERRED STOCK  

 OF  

 PINNACLE AIRLINES CORP.  

(Pursuant to Section 151 of the

General Corporation Law of the State of Delaware) 

        Pinnacle
Airlines Corp., a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called 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 by written consent in lieu of a meeting on
                            , 2002: 

        RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors of the Company (hereinafter called the Board of
Directors or the Board) in accordance with the provisions of the Company's Certificate of Incorporation, as amended to date (hereinafter called the Certificate of Incorporation), the Board hereby
creates a series of Preferred Stock, par value $.01 per share (the Preferred Stock), of the Company and hereby states the designation and number of shares, and fixes the relative rights, powers and
preferences thereof, and the limitations thereof, as follows: 

        SECTION 1.    Designation and Amount.    The shares of such series shall be designated as Series B Preferred
Stock (the Series B Preferred Stock) and the number of shares constituting the Series B Preferred Stock shall
be                        . 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 B Preferred Stock to a number less
than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding
securities issued by the Company convertible into Series B Preferred Stock. 

        SECTION 2.    Dividends and Distributions.    

        (A)  Subject
to the rights of the holders of any shares of any series of Preferred Stock of the Company (the "Preferred
Stock") (or any similar stock) ranking prior and superior to the Series B Preferred Stock with respect to dividends, the holders of shares of Series B Preferred
Stock, in preference to the holders of Common Stock, par value $.01 per share of the Company (the Common Shares) and of any other stock of the Company ranking junior to the Series B Preferred
Stock, shall be entitled to receive, when, as and if declared by the Board 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 B Preferred Stock, 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, 100 times the aggregate per share amount of all cash dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions other than a dividend payable in Common Shares, declared on the Common Shares 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 B Preferred Stock. In the event the Company shall at any time after
            declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or 

A-1

 

consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such
case the amount to which holders of shares of Series B Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that
were outstanding immediately prior to such event. 

        (B)  The
Company shall declare a dividend or distribution on the Series B Preferred Stock as provided in paragraph (A) of this Section immediately after it
declares a dividend or distribution on the Common Shares (other than a dividend payable in shares of Common Shares); provided that, in the event no dividend or distribution shall have been declared on
the Common Shares during the period between any Dividend Payment Date and the next subsequent Dividend Payment Date, a dividend of $1 per share on the Series B 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 B 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 B 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 B Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares of Series B Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the payment thereof. 

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

        (A)  Subject
to the provision for adjustment hereinafter set forth and except as otherwise provided in the Certificate of Incorporation or required by law, each share of
Series B Preferred Stock shall entitle the holder thereof to 100 votes on all matters upon which the holders of the Common Shares of the Company are entitled to vote. In the event the Company
shall at any time after                        , declare or pay any dividend on the Common Shares payable in Common Shares, or
effect a subdivision or combination or consolidation of the outstanding Common
Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the number of votes per share to which
holders of shares of Series B Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of
Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares 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 B Preferred Stock and the holders of Common Shares 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. 

A-2

 

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

        SECTION 4.    Certain Restrictions.    

        (A)  Whenever
quarterly dividends or other dividends or distributions payable on the Series B Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether or not earned or declared, on shares of Series B 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 (as to dividends) to the Series B Preferred
Stock;

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

	(iii)
	redeem
or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution
or winding up) to the Series B Preferred Stock, provided that the 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 B Preferred Stock or rights, warrants or options to acquire such junior
stock;

	(iv)
	redeem
or purchase or otherwise acquire for consideration any shares of Series B Preferred Stock, or any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with the Series B 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 B Preferred Stock purchased or otherwise acquired by
the Company in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. 

        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 Shares or of shares of any other stock of the Company ranking junior, upon liquidation, dissolution or winding up, to the
Series B Preferred Stock unless, prior thereto, the holders of shares of Series B Preferred Stock shall have received $            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 B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 100 times the aggregate amount to be distributed per share to holders of Common Shares,
or (B) to the holders of 

A-3

 

shares of stock ranking on a parity upon liquidation, dissolution or winding up with the Series B Preferred Stock, except distributions made ratably on the Series B Preferred Stock and
all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In the event the Company shall at any
time after                        declare or pay any dividend on the Common Shares payable in Common Shares, or effect a
subdivision or combination or consolidation of the outstanding Common Shares (by
reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the aggregate amount to which holders of shares
of Series B Preferred Stock were entitled immediately prior to such event under the proviso in clause (A) of the preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately
prior to such event. 

        SECTION 7.    Consolidation, Merger, etc.    In case the Company shall enter into any consolidation, merger,
combination or other transaction in which the Common Shares 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 B 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 100 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 Common Share is converted,
exchanged or converted. In the event the Company shall at any time after            declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or
combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, 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 B Preferred Stock shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding
immediately prior to such event. 

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

        SECTION 9.    Rank.    The Series B 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 Shares. 

        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 B Preferred Stock so as to affect the Series B Preferred Stock
adversely, then the holders of the Series B 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 B 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. 

A-4

 

        IN WITNESS WHEREOF, this Certificate of Designations is executed on behalf of the Company by its President and Chief Executive Officer and
attested by its Secretary this    day of                        , 2002. 

	 	 	
 President and Chief Executive Officer

Attest: 

	
 Secretary

	 	 

A-5

  

 
 

Exhibit B    
  

 
 

FORM OF RIGHT CERTIFICATE    
  

	Certificate No. R-            	 	             Rights

NOT
EXERCISABLE AFTER                        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 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
  
    PINNACLE AIRLINES CORP.    
  

        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            , 2002, as the same may be amended from time to time (the "Rights
Agreement"), between Pinnacle Airlines Corp., a Delaware corporation (the "Company"),
and                        (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            , 2012 at the office or agency of the Rights Agent designated for such purpose, or of its successor as Rights Agent, one
one-hundredth of a fully paid non-assessable share of Series B Preferred Stock, par value $.01 per share (the "Preferred
Stock"), of the Company, at a purchase price of $    per one one-hundredth 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-hundredths 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                        , 20    , based on the Preferred Stock as
constituted at such date. As provided in the Rights Agreement, the Purchase Price, the number of
one one-hundredths 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. 

        This
Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement are on file at the principal executive offices of the Company and the above-mentioned office or
agency of the Rights Agent. 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 

B-1

 

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 will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples of one
one-hundredth 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 hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in the Rights Agreement) or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right certificate shall have been exercised as provided in the Rights Agreement. 

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

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

	Dated:	 	ATTEST: PINNACLE AIRLINES CORPORATION
	 	 	 	 	 	 	 
	By	 	 	 	By	 	 
	 	 	
	 	 	 	

	 	 	 	 	 	 	 
	Countersigned:	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
 as Rights Agent	 	 	 	 
	 	 	 	 	 	 	 
	By	 	 	 	 	 	 
	
 Authorized Signature	 	 	 	 

B-2

 
 
 

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                                        here
by 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 member firm of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., or a commercial bank
or trust company having an office or correspondent in the United States. 

	
 (To be completed)

        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 assigned
to, an Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights Agreement). 

	 	 	
 Signature

B-3

 
 
 

Form of Reverse Side of Rights Certificate—continued    
  

 
 

FORM OF ELECTION TO PURCHASE
  
    (To be executed if holder desires to exercise
  Rights represented by the Rights Certificate)    
  

        To Pinnacle Airlines Corp.: 

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

	
 (Please print name and address)
	

 	
 	

 
	

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

Please
insert social security

or other identifying number 

	
 (Please print name and address)
	

 	
 	

 
	

       

	Dated:	 	 	 	 
	 	 	
	 	
 Signature

(Signature
must conform to holder specified on Right Certificate) 

Signature
Guaranteed: 

        Signature
must be guaranteed by a member of firm of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., or a commercial
bank or trust company having an office or correspondent in the United States. 

B-4

 
 
 

Form of Reverse Side of Rights Certificate—continued    
  

       

	
 (To be completed)

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

	 	 	 	 	
 Signature
	

 	
 	

 	
 	

 
	

 
 

NOTICE    
  

        The signature in the Form of Assignment or Form of Election to Purchase, as the case may be, must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change whatsoever. 

        In
the event the certification set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, such Assignment or Election to
Purchase will not be honored. 

UNDER
CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO 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            , 2002, the Board of Directors of Pinnacle Airlines Corp., a Delaware corporation (the  "Company"), authorized and 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 Shares"). The dividend is payable to the stockholders of
record as of the time of                        (the "Record Date").
Each Right entitles the registered holder to purchase from the Company one one-hundredth of a share of Series B Preferred Stock, par value $.01 per share (the  "Preferred Stock"), of the Company at
a price of $    per one one-hundredth 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            , 2002, as
the
same may be amended from time to time (the "Rights Agreement"), between the Company
and                        , as Rights Agent (the  "Rights Agent"). 

        Until
the earlier to occur of (i) 10 days following a public announcement that a person or group of affiliated or associated persons (an "Acquiring
Person") have acquired beneficial ownership of a number of Common Shares equal to 15% or more of the sum of (a) the Common Shares then issued and outstanding,
(b) all Common Shares issuable upon conversion of all the shares of Series B Preferred Stock, par value $.01 per share ("Series B Preferred
Stock"), then issued and outstanding, (c) all Common Shares issuable upon the exercise of all employee stock options then issued and outstanding as
of                        ,
20    and (d) any other Common Shares not then actually issued and outstanding but which such Person would be deemed to beneficially own under the Rights Agreement (together, the  "outstanding Common
Shares") or (ii) 10 business days (or such later date as may be
 

B-5

 

determined by action of the Board prior to such time as any person or group of affiliated persons becomes an Acquiring Person) following the commencement of, or announcement of an intention to make,
a tender offer or exchange offer the consummation of which would result in the beneficial ownership by a person or group of a number of Common Shares equal to 15% or more of the number of outstanding
Common Shares (the earlier of such dates being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, by such Common Share certificate together with a copy of this Summary of Rights distributed to each holder of Common Shares (the  "Summary of Rights").

        The
Rights Agreement provides that, until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the Common Shares.
Until the Distribution Date (or earlier redemption or expiration of the Rights), new Common Share certificates issued after the Record Date upon transfer or new issuances of Common Shares (including
pursuant to the conversion of Series B Preferred Stock) will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier redemption or expiration
of the Rights), the surrender for transfer of any certificates for Common Shares outstanding as of the Record Date, even without such notation or a copy of this Summary of Rights, will also constitute
the transfer of the Rights associated with the Common Shares represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the Common Shares as of the close of business on the Distribution Date and such separate
Right Certificates alone will evidence the Rights. 

        The
Rights are not exercisable until the Distribution Date. The Rights will expire on                        , 2012 (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
number of outstanding Rights are also subject to adjustment in the event of a stock split of the Common Shares or a stock dividend on the Common Shares payable in Common Shares or
subdivisions, consolidations or combinations of the Common Shares 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 $1 per share but will be entitled to an aggregate dividend of 100 times the dividend declared per share of Common Stock. In the event of liquidation, the
holders of the Preferred Stock will be entitled to a minimum preferential liquidation payment of $            per share (plus any accrued but unpaid dividends) but will be entitled to an
aggregate
payment of 100 times the payment made per share of Common Stock. Each share of Preferred Stock will have 100 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 100 times the amount received per share of
Common Stock. These rights are protected by customary antidilution provisions. 

B-6

 

        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 at the then current exercise price of the Right, that number of Common Shares (or one
one-hundredths of a share of Preferred Stock) having a market value of two times the exercise price of the Right. 

        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 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 exercise price of the Right. 

        At
any time after any person or group becomes an Acquiring Person and prior to the acquisition by such person or group of beneficial ownership of a number of Common Shares equal to 50%
or more of the number of outstanding Common Shares, the Board 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 Common Share, or one one-hundredth of a share of Preferred Stock (or of a share of a class or series of the Company's preferred stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment). 

        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-hundredth 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 the Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right (the Redemption
Price). 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 amend the Rights in any manner except that it may not decrease the redemption price. After the Rights are no longer
redeemable the Company may, except with respect to the Redemption Price, amend the Rights in any manner that does not adversely affect the interests of holders of the Rights. 

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

        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. 

B-7

QuickLinks

Exhibit 4.2

TABLE OF CONTENTS

RIGHTS AGREEMENT

Exhibit A

Exhibit B

FORM OF RIGHT CERTIFICATE

Right Certificate PINNACLE AIRLINES CORP.

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)

Form of Reverse Side of Rights Certificate—continued

FORM OF ELECTION TO PURCHASE (To be executed if holder desires to exercise Rights represented by the Rights Certificate)

Form of Reverse Side of Rights Certificate—continued

NOTICE

SUMMARY OF RIGHTS TO PURCHASE Shares of Preferred Stock

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