Document:

exv4w9

Exhibit 4.9

EMPLOYMENT AGREEMENT

DATED

PARTIES

NOVOGEN LABORATORIES PTY LTD ACN 002 489 947

AND

MARK GREGORY HINZE

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	EMPLOYMENT AGREEMENT made          2010
	 	

PARTIES

NOVOGEN LABORATORIES PTY LTD ACN 002 489 947 of

140 Wicks Road, North Ryde, New South Wales, 2113 (“Company”)

AND

MARK GREGORY HINZE

of 8 Gawain Court, Glenhaven, NSW, 2156 (“Employee”)

INTRODUCTION

	A.	 	The Company carries on the Business.
	 
	B.	 	The Company wishes to employ the Employee to provide the Services.
	 
	C.	 	The parties have agreed to the employment of the Employee in accordance with the provisions
of this Agreement and with the intention that this Agreement will supersede any written or
oral agreement between the parties or between the Employee and any other member of Novogen
Group.

IT IS AGREED

1. Definitions and Interpretations

	1.1	 	In this Agreement, unless the context otherwise requires:
	 
	 	 	“Agreement” means this employment agreement and any variation amendment or replacement of
it;
	 
	 	 	“Board” means the Company’s board of directors;
	 
	 	 	“Business” means the business carried on by the Company and the members of the Novogen
Group;
	 
	 	 	“Business Day” means a day that is not a Saturday, Sunday or any other day which is a
public holiday or a bank holiday in the place where an act is to be performed or a payment
is to be made;
	 
	 	 	“Commencement Date” means the date of this Agreement;
	 
	 	 	“Company” means Novogen Laboratories Pty Limited ACN 002 489 947 and includes the
successors and assigns of that company;
	 
	 	 	“Confidential Information” means all information concerning the Business, the business
methods of the Company and any member of the Novogen Group, their technologies, pricing
policies, marketing strategies, Intellectual Property and any other information relating to
the affairs of the Company or the Novogen Group, but does not include:

	 	(a)	 	information which was in the public domain before it was given to or accessed by the
Employee; or

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	 	(b)	 	information which, after being given to or accessed by the Employee, became part of the
public domain other than as a result of a breach by the Employee of any obligation
of confidence to the Company or the Novogen Group;

	    	 	“Corporations Act” means the Corporations Act 2001 (Cth);
	 
	 	 	“Design” has the same meaning as in the Designs Act 2003 (Cth);
	 
	 	 	“Intellectual Property” means all industrial and intellectual property rights throughout
the world, including trade marks, logos, service marks, trade names, business names,
copyrights, designs, patents, inventions, processes and other technical know-how (including
extraction and manufacturing know-how), secret information and other rights in industrial
or intellectual property and applications for them or licence agreements or other
arrangements under which a person has the right to use any of them;
	 
	 	 	“Inventions” means all inventions, discoveries and novel designs, whether or not
registrable as designs under the Designs Act 2003 (Cth) or patents under the Patents Act
1990 (Cth), or any corresponding law in any other country, including any inventions,
developments, improvements or modifications to compounds, equipment, technology, methods or
techniques;
	 
	 	 	“Novogen Group” means the Company and each of Novogen Research Pty Limited ACN 060 202 931,
Novogen Limited ACN 063 259 754 and any Related Body Corporate of any of them from time to
time;
	 
	 	 	“Patents” has the same meaning as in the Patents Act 1990 (Cth);
	 
	 	 	“Related Body Corporate” in relation to a body corporate means a body corporate that is
related to the first mentioned body by virtue of section 50 of the Corporations Act;
	 
	 	 	“Remuneration” means the amount determined under clause 14;
	 
	 	 	“Restraint Period” means the period described in Item 7 of the Schedule;
	 
	 	 	“Services” means the services described in clause 4 to be provided in accordance with this
Agreement;
	 
	 	 	“Total or Permanent Disability” includes the Employee being absent from his employment by
reason of sickness, ill health or other incapacity or disability for a period of more
than three months in excess of accrued sick leave in any period of 12 consecutive
months; and
	 
	 	 	“Works” means all works and other subject matter as defined in the Copyright Act 1968
(Cth), and any other thing in which copyright subsists.

1.2 Interpretation

	 	(a)	 	Reference to:

	 	(i)	 	one gender includes the other genders;
	 
	 	(ii)	 	the singular includes the plural and the plural includes the singular;
	 
	 	(iii)	 	a person includes a body corporate;

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	 	(iv)	 	a party includes the party’s executors, administrators,
successors and permitted assigns; and
	 
	 	(v)	 	a statute, regulation or provision of a statute or regulation (“Statutory Provision”)
includes:

	 	(1)	 	that Statutory Provision as amended or
re-enacted from time to time; and
	 
	 	(2)	 	a statute, regulation or provision enacted
in replacement of that Statutory Provision.

	 	(b)	 	All monetary amounts are in Australian dollars, unless otherwise stated.
	 
	 	(c)	 	Headings are for convenience only and do not affect the interpretation, or
form part, of this Agreement.
	 
	 	(d)	 	Where a word or expression is given a particular meaning, other parts of
speech and grammatical forms of that word or expression have a corresponding meaning.
	 
	 	(e)	 	If an act must be done on a specified day which is not a Business Day, the
act must be done instead on the next Business Day.

2. Employment

	2.1	 	The Company employs the Employee to provide the Services to the Company on the terms of this
Agreement and the Employee accepts such employment.
	 
	2.2	 	The position in which the Employee is employed by the Company is as set out in Item 1 of the
Schedule.
	 
	2.3	 	The Employee is to be located at the office of the Company set out in Item 2 of the Schedule.

3. Term

	 	 	This employment continues until terminated in accordance with clause 18.

4. Services

	4.1	 	The Employee must perform all the functions of a person in the position set out in Item 1 of
the Schedule or such other services as may be determined by the Company from time to time.

	4.2	 	The Employee must carry out his employment in the capacity referred to in clause 4.1 or as
amended by the Company in such manner and at such time as the Company may from time to time
reasonably determine.

5. General Duties and Obligations

	5.1	 	Without limiting any other provision of this Agreement the Employee must at all times during
his employment:

	 	(a)	 	be just and faithful in all transactions relating to the Company and the
Novogen Group and must show the utmost good faith in the business of the Company and
the Novogen Group;

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	 	(b)	 	give to the Company a just and faithful account of such transaction and also
upon every reasonable request furnish a full and correct explanation thereof to the
Company;
	 
	 	(c)	 	divulge to the Company all information or knowledge which he may possess in
relation to the affairs, business and activities of the Company;
	 
	 	(d)	 	use his best skill and endeavour to promote the interest and welfare of the
Company and the Novogen Group and carry out the same for the utmost benefit of the
Company and the Novogen Group and diligently and faithfully apply himself to the
affairs, business and activities of the Company; and
	 
	 	(e)	 	not at any time intentionally do anything which directly or indirectly may
impair or be likely to impair the good name and reputation of the Company or the
Novogen Group.

	5.2	 	The Employee must carry out his employment and must conduct himself at all times in a
professional manner.

6. Compliance with Directions

	 	 	The Employee must at all times during his employment obey, comply with and carry out the
proper and reasonable directions, orders and instructions of and is directly responsible
and answerable to the Individual or Group identified in Item 8 of the Schedule or as
amended by the Company.

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7. Time Devoted to Employment

	7.1	 	The Employee must at all times during his employment devote the whole of his attention and
abilities to the business and activities of the Company and in the performance of his
responsibilities and duties under this Agreement.

	7.2	 	Without the prior written consent of the Company, the Employee must not be a director of any
body corporate which carries on or is concerned with any activity identical to or
substantially similar to that of the Novogen Group or where being a director may directly or
indirectly affect the Business of the Novogen Group.

	7.3	 	Nothing contained in this clause 7 prohibits the Employee from making any purchase or sale of
securities, real estate or personal property (tangible or intangible) for purposes of
investment or from making any other private investment other than as may be prohibited by
clause 17 or one which is, in the opinion of the Company, reasonably held, detrimental to the
interest of the Novogen Group.

8. Duty to Act within Limits

The Employee must not without the prior written consent of the Company:

	 	(a)	 	employ any of the money, goods or effects of the Company or any member of
Novogen Group or pledge the credit thereof except in the ordinary course of business
and upon the account of and or the benefit of the Company or member of the Novogen
Group;
	 
	 	(b)	 	lend money or give credit on behalf of the Company or any member of the Novogen Group
or have any dealings with any person whom the Company has previously in writing
forbidden the Employee to deal with or trust;

	 
	 	(c)	 	give any guarantee, undertaking or indemnity or enter into any bond with or
become bail, surety or surety for any person or do or knowingly cause or suffer to be
done anything by which the property of the Company or any member of the Novogen Group
or any part of it may be seized, attached or taken in execution; or
	 
	 	(d)	 	enter into any leasing, hiring, hire-purchase, rental or financing
arrangements or transactions with respect to assets or property acquired or to be
acquired by the Company or any member of the Novogen Group.

9. Indemnity by Employee

	 	 	Unless otherwise resolved by the Board, the Employee will indemnify the Company or member
of the Novogen Group, as the case may be, in respect of any loss or damage or actions,
proceedings costs, claims, demands or judgements it may incur or suffer by reason of any
breach by the Employee of any of the provisions of clause 8. This indemnity is in addition
to and not in substitution for any other right or remedy available to the Company in the
event of such breach.

10. Indemnity by Company

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	10.1	 	Subject to the Corporations Act and the Constitution of the Company, the Company will
indemnify the Employee and his executors, administrators and legal personal representatives
against any loss, costs, damages, judgments or liability suffered or incurred by the Employee
in respect of any act, neglect, default or error or judgement in the course of his employment
and for which the Company would be vicariously liable other than any wilful or gross neglect,
default or breach of duty or breach of trust.

	10.2	 	Without limiting clause 10.1:

	 	(a)	 	the Employee may be indemnified by the Company where the Board considers it
appropriate, against any liability incurred by the Employee in the connection with the
performance by him of his position with the Company, unless the liability arises out of
conduct involving lack of good faith;
	 
	 	(b)	 	the Employee is indemnified by the Company against any liability incurred by
him in defending any proceedings in connection with the performance by him of his
position with the Company whether civil or criminal in which judgment is given in his
favour or in which the Employee is acquitted or in connection with any application in
relation to any proceedings in which relief under the Corporations Act is granted to
him by the court; and
	 
	 	(c)	 	to the extent permissible by law, the Company may, pay a premium in respect of a
contract insuring the Employee against a liability incurred by the Employee in
connection with the performance by him of his position with the Company except for a
liability arising out of conduct involving a wilful breach of duty in relation to the
Company.

11. Annual Leave

	11.1	 	During the course of his employment the Employee is entitled to 20 days accrued paid annual
leave in accordance with the Fair Work Act 2009 (Cth).

	11.2	 	The days of annual leave referred to in clause 11.1 are in addition to any day which is
proclaimed to be a public holiday in the place in which the Employee is at the relevant time
located.

	11.3	 	Any annual leave entitlement not taken may be added to and taken with any further annual
leave entitlement.

12. Sick Leave

	12.1	 	The Employee is entitled to be paid sick leave of 11 working days for every 12 months of
service.

	12.2	 	Any sick leave entitlement not taken in any year may be taken by the Employee in another year
provided that any accumulated sick leave entitlement which immediately prior to the
termination of the employment of the Employee has not been taken is forfeited on termination.

13. Long Service Leave

	 	 	The Employee is entitled to long service leave under the Long Service Leave Act of the
State or Territory in which the Employee is located.

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14. Remuneration

	14.1	 	The Employee is entitled to the Remuneration and other benefits specified in Items 3 to 6 of
the Schedule. The salary component of the Remuneration is to be paid monthly by direct
deposit into an account nominated by the Employee.
	 
	14.2	 	The Remuneration is inclusive of all entitlements the Employee may have under a modern award
or an enterprise agreement (including, but not limited to allowances, penalties, overtime or
loadings, including leave loading).
	 
	14.3	 	The Remuneration is to be reviewed annually and any increases may be made at the Company’s
discretion.
	 
	14.4	 	As part of the Remuneration, the Company is to contribute the minimum amount to a complying
superannuation fund in order to avoid any charge under the Superannuation Guarantee (Charge)
Act 1992. This amount is included in the Remuneration specified in Item 6 of the Schedule.
	 
	14.5	 	The Employee is free to direct his superannuation contributions to a regulated complying
superannuation fund of his choice.
	 
	14.6	 	The Employee may request and the Company may agree to structure the Remuneration to fit in
with his personal requirements (for example to include extra superannuation payments, motor
vehicle, etc) provided that the arrangements comply at all times with company policies and
applicable laws (as amended from time to time).
	 
	14.7	 	The Remuneration is designed to compensate the Employee for all hours worked and the Employee
is not entitled to any payment of any overtime during the term of his employment hereunder.

15. Directorships

	15.1	 	The Company may require the Employee to serve as a director on the board of any member to the
Novogen Group.
	 
	15.2	 	If the Employee is required to serve as a director of another member of the Novogen Group as
the nominee of the Company the Employee must retire as a director from any such board upon his
being requested to do so by the Company.
	 
	15.3	 	If the Employee ceases to be an employee of the Company or a member of the Novogen Group, he
is taken to have automatically retired as a director of each member of the Novogen Group. In
consideration of the benefits given by this Agreement to the Employee the Employee is taken to
have given an irrevocable authority to the Managing Director or other appointee of the Board
to do all things and execute all documents necessary on behalf of the Employee to give effect
to the resignations.

16. Confidentiality

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	16.1	 	Without limiting or derogating from in any way any rule of law or equity, the Employee must
not without the prior written consent of the Company publish or divulge any Confidential
Information to any person unless such publication or disclosure is made in the normal course
of his employment.
	 
	16.2	 	The provisions of this clause 16 do not prejudice any other express or implied obligation on
the part of the Employee to maintain confidentiality.
	 
	16.3	 	Without limiting the extent of clauses 16.1 or 16.2, Confidential Information may include
information disclosed to the Company or the Employee by any existing or potential customer,
supplier, contractor, agent, licensee or licensor of the Company or the Novogen Group.
	 
	16.4	 	The Employee must at the request of the Company sign a confidentiality agreement containing
provisions similar to the provisions in this clause 16 in favour of any member of the Novogen
Group or any of the persons referred to in clause 16.3.
	 
	16.5	 	This clause 16 survives termination of the employment with respect to any information until
such information is no longer Confidential Information.

17. Restraint

	17.1	 	The Employee may not either alone or jointly or in partnership or by way of a joint venture
or otherwise with or as a shareholder, servant, agent, consultant, adviser, officer or
contractor of any other person or persons, other than as an employee of the Company or a
member of the Novogen Group, either directly or indirectly carry on or manage or be concerned
or interested in or assist any other person or persons to carry on or be concerned or to
obtain any interest in business identical to or to the business of the Company, or any of the
members of the Novogen Group in any State or Territory of Australia or any other place in the
world at any time:

	 	(a)	 	during the course of his employment with the Company or a member of the Novogen Group
and
	 
	 	(b)	 	during the period set out in Item 7 of the Schedule.

	17.2	 	The Employee may hold shares in a public company the shares of which are quoted on any share
or stock exchange in the world.
	 
	17.3	 	The Employee must not during the period set out in item 7 of the Schedule either directly or
indirectly on his own account or for or with any other person or persons, solicit, interfere
with or endeavour to entice away from the Company, or any of the members of the Novogen Group
any person who, during the employment of the Employee with the Company or any member of the
Novogen Group was a customer, supplier, contractor, agent, licensee or licensor or to the
knowledge of the Employee was a person with whom any of the aforesaid was negotiating with a
view to that person becoming a customer, supplier, contractor, agent, licensee or licensor of
any of the aforesaid.
	 
	17.4	 	The provision of clauses 17.1 and 17.3 are necessary in order to protect the interests of the
Company, the Novogen Group and of the Business and the confidentiality of the knowledge of the
Employee as to the affairs, business and activities of the Company and the Novogen Group.

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	17.5	 	It is acknowledged by the Employee that the provisions of clause 17.1 and 17.3 are
reasonable, particularly in light of the provisions of clause 17.4 and insofar as the
provisions of clause 17.1 relate to any activity, state or territory, the restraint is
distinct and severable from any other activity, state or territory and the invalidity of the
restraint in respect of one or more of such activities, states or territories is not to affect
its validity in respect of any of the other such activities, states or territories.
	 
	17.6	 	Nothing in clauses 17.1, 17.3, or 17.4 is to be construed as limiting or fettering the right
of any court of competent jurisdiction upon the application of any party in appropriate
proceedings from imposing upon the Employee a lesser restraint in circumstances where the
restraint sought to be imposed in clauses 17.1 or 17.3 is, in the opinion of such court,
excessive or unreasonable in the circumstances.

18. Termination of Employment

	18.1	 	Either party may terminate the employment by giving six months’ notice, or in the case of
termination by the Company, by making a payment in lieu of six months’ notice to the Employee,
subject to clauses 18.2 and 18.7.
	 
	18.2	 	A payment in lieu of notice made under clause 18.1, 18.5(b) or 18.7 is to be calculated on
the basis of the Employee’s Remuneration.
	 
	18.3	 	The employment is terminated immediately on the death or Total or Permanent Disability of the
Employee.
	 
	18.4	 	At any time, the employment may be terminated by the Company if the Employee:

	 	(a)	 	is guilty of any criminal or indictable offence or of any dishonesty, whether
in relation to the affairs of the Company or any of the members of the Novogen Group
or not;
	 
	 	(b)	 	is guilty of any serious breach of faith, serious neglect, default, wilful
disregard of directions, serious professional misconduct or gross misconduct;
	 
	 	(c)	 	has received written notice from the Company that the Employee is in serious
and fundamental breach of this Agreement and the Employee fails to remedy the breach
within 14 days of receiving the notice;
	 
	 	(d)	 	if he is a member of any board of directors of any body corporate has his
office suspended or disqualified under the Corporations Act;
	 
	 	(e)	 	a person whose person or estate is being dealt with under the law relating to
mental health; or
	 
	 	(f)	 	ceases to be registered or has his registration suspended for any reason
whatsoever under the provision of any legislation dealing with the registration of
persons providing services of the nature of those provided by the Employee to the
Company and which registration is required for the provision by the Employee of those
services.

	18.5	 	If the Employee resigns pursuant to clause 18.1, the Company may choose:

	 	(a)	 	to retain the services of the Employee during the notice period; or
	 
	 	(b)	 	not to retain the services of the Employee for some or all of the notice
period, and make a payment in lieu of notice for the part of the notice period for
which the Employee is not retained, subject to clauses 18.2 and 18.7.

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	18.6	 	For all or part of the Employee’s notice period under clauses 18.1 or 18.5, the Company may
direct the Employee:

	 	(a)	 	not to attend for work at the Company’s premises;
	 
	 	(b)	 	to attend for work at a different location to the Employee’s usual work
location;
	 
	 	(c)	 	to perform no work; or
	 
	 	(d)	 	to perform designated duties which are within the Employee’s skill and
competence, whether or not these duties form part of the Employee’s usual role,

	 	 	and all the Employee’s obligations under this Agreement will continue to apply during the
notice period.
	 
	18.7	 	On termination by the Company under clause 18.1, the Company is to pay to the Employee a
termination payment of six months’ Remuneration in addition to any amount payable by way of
Remuneration or in lieu of notice.
	 
	18.8	 	The Employee acknowledges that the Company is undertaking a restructure and the Employee may
be required to enter into another agreement to provide the Services to another entity on
similar terms to this Agreement (“Offer”). Subject to the preservation of all rights under
this Agreement and the Offer being on no less favourable terms than this
Agreement, the employment is not taken to have terminated in circumstances where the
Employee has received an Offer and (amongst other things) the Employee is not entitled to a
payment under clause 18.7.

19. Compliance with Obligations on Termination

	19.1	 	Termination of this Agreement for any reasons whatsoever does not relieve the Company from
payment in full of all sums then owing by the Company to the Employee by way of remuneration
accrued to the date of termination.

	19.2	 	Termination of this Agreement for any reason whatsoever is not to relieve the Employee from
payment in full of all sums then owing to the Company or which may become owing in respect of
any period prior to termination and is without prejudice to the rights of the Company to sue
for antecedent breach by the Employee of the terms of this Agreement.

20. No Claim for Compensation on Termination

	 	 	If the employment is terminated, the Employee has no claim against the Company for
compensation, damages or otherwise for or in respect of or by a reason of such termination
except as expressly set out in this Agreement.

21. Duty to Deliver Up

	 	 	Upon the termination of this Agreement and the employment of the Employee for any reason
whatsoever the Employee, on request from the Company must deliver up to the Company all
correspondence, documents, records, papers, prints, manuals, paper, disks, computer codes,
access codes, keys and property of any nature whatsoever belonging to the Company, or to
any member of the Novogen Group which may be in the possession or under

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	 	 	custody or control
of the Employee. Any such request must not be made unreasonably.

22. Inventions, Works and other Intellectual Property

	22.1	 	The Employee assigns to the Company:

	 	(a)	 	all Inventions;
	 
	 	(b)	 	the entire copyright in all Works; and
	 
	 	(c)	 	all other Intellectual Property,

	 	 	created by the Employee in the course of his employment, or by any use of the Company’s
facilities, resources or Intellectual Property.
	 
	22.2	 	The assignment in clause 22.1 does not restrict the Employee’s right to utilise the general
expertise and knowledge accumulated by the Employee in the performance of the Services and the
Employee is entitled to use routine procedures developed by the Employee in the performance of
the Services, provided that the Employee must not exploit any Invention or make any
reproduction or substantial reproduction of any Works without the written consent of the
Company.
	 
	22.3	 	Where the Employee makes a Design arising out of the Services, the Design will be owned by
the Company or the member of the Novogen Group for whom it was made.
	 
	22.4	 	Where the Employee makes any patentable process or article, the Patent will be owned by the
Company or the member of the Novogen Group for whom it was made.

23. Future Copyright

	23.1	 	The Employee assigns to the Company the copyright that will subsist in respect of any new
Works, and the new Works will form part of the Works under this Agreement and the terms and
conditions of this Agreement will apply to those new Works.
	 
	23.2	 	The Employee must immediately provide the Company with copies of any new Works he prints,
publishes, makes or procures during the employment.

24. Further Assurances as to Intellectual Property

	24.1	 	The Employee must during and after the employment and at any time thereafter do all acts and
things and sign all documents as the Company may reasonably request to secure the ownership of
the Company or any member of the Novogen Group in any Inventions, Works, Designs or other
Intellectual Property.

25. Severability

	25.1	 	Each word, phrase, sentence, paragraph and clause (“provision”) of this Agreement is
severable.
	 
	25.2	 	If a Court determines that any provision of this Agreement is unenforceable, illegal or void
then it is severed and the other provisions of this Agreement

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	      	 	remain operative unless without
the offending provision they are fundamentally different.

26. Waiver

	26.1	 	A party’s failure or delay to exercise a power or right does not operate as a waiver of that
power or right.

	26.2	 	The exercise of power or right does not preclude either its exercise in the future or the
exercise of any other power or right.

	26.3	 	No waiver is effective unless it is in writing.

	26.4	 	The waiver of a power or right is effective only in respect of the specific instance to which
it relates and for the specific purpose for which it is given.

27. Entire Understanding

	27.1	 	This Agreement:

	 	(a)	 	contains the entire agreement and understanding between the parties on
everything connected with the subject matter of this Agreement; and
	 
	 	(b)	 	supersedes and merges any prior agreement or understanding on anything
connected with that subject matter.

	27.2	 	Each party has entered into this Agreement without relying on any representation by any other
party or any person purporting to represent that party.

28. Variation

	 	 	An amendment or variation to this Agreement is not effective unless it is in writing and
signed by both parties.

29. Further Assurance

	 	 	Each party must promptly at its own cost do all things (including executing all documents)
necessary or desirable to give full effect to this Agreement.

30. Dispute Resolution

	30.1	 	Unless a party has complied with clauses 30.2, 30.3 and 30.4, that party may not commence
court proceedings relating to any dispute under this Agreement, except where that party seeks
urgent interlocutory relief.

	30.2	 	If there is a dispute under this Agreement the parties must negotiate in good faith to
resolve the dispute in a spirit of goodwill and compromise.

	30.3	 	If there is a dispute under this Agreement that is not resolved in accordance with clause
30.2, either party may give written notice to the other party stating that it is a notice
under this clause and specifying the dispute.

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	30.4	 	If the dispute is not settled by agreement within 14 days after the notice referred to in
clause 30.3 is given, the parties must appoint a mediator and must seek in good faith to
settle the dispute through mediation. If the parties are unable to agree upon a mediator
within 14 days after the expiration of the initial 14 days referred to in this clause 30.4,
the mediator must be a person nominated by the President of the Law Society of New South Wales
or his or her delegate, and either party may request the nomination at any time after the
expiration of the second 14 days referred to in this clause.

31. Notices

	31.1	 	A notice or other communication required or permitted to be given by a party to another is to
be in writing and:

	 	(a)	 	delivered; or
	 
	 	(b)	 	sent by postage prepaid to that party’s address set out in this Agreement or as
notified to each party at any time.

	31.2	 	A notice or other communication is deemed given and received if:

	 	(a)	 	delivered, upon delivery; or
	 
	 	(b)	 	mailed, on the expiration of 2 Business Days (at the place of mailing) after mailing.

32. Governing Law and Jurisdiction

	32.1	 	The law of New South Wales governs this Agreement.
	 
	32.2	 	The parties submit to the non-exclusive jurisdiction of the courts of New South Wales and the
Federal Court of Australia.

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SCHEDULE

Item 1. Position

	 	(1)	 	Chief Financial Officer of the Novogen Limited
	 
	 	(2)	 	With responsibilities for:

	 	a)	 	monitoring and reporting on the financial
performance of the Novogen Group;
	 
	 	b)	 	preparing and filing all financial reports
as required under the corporations law in Australia and the USA (
NASDAQ requirements);
	 
	 	c)	 	preparing and filing all corporate tax
returns;
	 
	 	c)	 	providing financial and commercial advice
to the Novogen Management Committee and Board;
	 
	 	e)	 	co-ordinating the financial management
of the Novogen Group companies;
	 
	 	f)	 	managing and reporting on the Group’s cash flows;
	 
	 	g)	 	effectively managing and reporting on the utilisation of the
Group’s assets;
	 
	 	h)	 	developing and co-ordinating the
preparation of the Group’s budgets and forecasts;
	 
	 	i)	 	developing key financial staff;
	 
	 	j)	 	developing effective relationships with
auditors, bankers, lawyers, the financial community and other
external advisors;
	 
	 	k)	 	completing financial analysis and
participate in projects which have a significant impact on the
Company;
	 
	 	l)	 	identifying new and better ways of doing business.

Item 2. Location

	 	 	140 Wicks Road, North Ryde, New South Wales, 2113, or such other place within the
Metropolitan Sydney area as is designated from time to time by the Managing
Director.

Item 3. Accrued Annual Leave

	 	 	As accrued from 26 March, 1999

Item 4 Accrued Sick Leave

15

 

	 	 	As accrued from 26 March, 1999

Item 5 Long Service Leave

	 	 	As accrued from 26 March, 1999

16

 

Item 6 Remuneration

	 	 	$180,000 or such other amount as agreed to from time to time.

Item 7. Restraint Period

	 	 	12 months commencing on the date of termination of the employment of the Employee
with the Company or any member of the Novogen Group (however that termination
occurs).

Item 8 Compliance with Directions

17

 

EXECUTED as an agreement on the date set out at the commencement of this Agreement.

Executed by NOVOGEN LABORATORIES

PTY LTD ACN 002 489 947:

	 	 	 	 	 	 	 

	 
	 	 	 	 	 	 
	 

Director/Secretary

	 	 	 	 

Director
	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	Name of Director/Secretary (BLOCK LETTERS)

	 	 	 	Name of Director (BLOCK LETTERS)	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Novogen Limited

Director	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name of Director (BLOCK LETTERS)	 	 

	 	 	 	 	 	 	 	 	 

	SIGNED by:

	 	 	)	 	 	 	 	 
	MARK GREGORY HINZE

	 	 		 	)	 	 	 
	in the presence of:

	 	 		 	)	 

	 	 

	 	 	 	 	 	 	 

	 
	 	 	 	 	 	 
	 

Signature of Witness

	 	 	 	 
	 	 
	 
	 	 	 	 	 	 
	 

Name of Witness (BLOCK LETTERS)

	 	 	 	 
	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

Address of Witness

	 	 	 	 
	 	 

18Exhibit 4.1

EXHIBIT 4.1

RIGHTS AGREEMENT

between

SPECTRUM PHARMACEUTICALS, INC.,

and

COMPUTERSHARE TRUST COMPANY, N.A.,

as Rights Agent,

Dated as of December 13, 2010

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	Section 1. Certain Definitions
	 	 	1	 
	Section 2. Appointment of the Rights Agent
	 	 	6	 
	Section 3. Issuance of Rights Certificates
	 	 	6	 
	Section 4. Form of Rights Certificates
	 	 	8	 
	Section 5. Countersignature and Registration
	 	 	8	 
	Section 6. Transfer, Split-Up, Combination, and Exchange of Rights Certificates;
Mutilated, Destroyed, Lost, or Stolen Rights Certificates
	 	 	9	 
	Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights
	 	 	10	 
	Section 8. Cancellation and Destruction of Rights Certificates
	 	 	12	 
	Section 9. Reservation and Availability of Capital Stock
	 	 	12	 
	Section 10. Preferred Shares Record Date
	 	 	14	 
	Section 11. Adjustment of Purchase Price, Number and Kind of Shares, or Number of
Rights
	 	 	14	 
	Section 12. Certificate of Adjusted Purchase Price or Number of Shares
	 	 	21	 
	Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning Power
	 	 	22	 
	Section 14. Fractional Rights and Fractional Shares
	 	 	24	 
	Section 15. Rights of Action
	 	 	25	 
	Section 16. Agreement of Rights Holders
	 	 	25	 
	Section 17. Rights Certificate Holder Not Deemed a Stockholder
	 	 	26	 
	Section 18. Concerning the Rights Agent
	 	 	27	 
	Section 19. Merger or Consolidation or Change of Name of the Rights Agent
	 	 	27	 
	Section 20. Duties of the Rights Agent
	 	 	28	 
	Section 21. Change of the Rights Agent
	 	 	30	 
	Section 22. Issuance of New Rights Certificates
	 	 	30	 

 

 

 

	 	 	 	 	 
	Section 23. Redemption and Termination
	 	 	31	 
	Section 24. Exchange of Rights
	 	 	31	 
	Section 25. Notice of Certain Events
	 	 	33	 
	Section 26. Notices
	 	 	34	 
	Section 27. Supplements and Amendments
	 	 	34	 
	Section 28. Successors
	 	 	35	 
	Section 29. Determinations and Actions by the Board of Directors
	 	 	35	 
	Section 30. Benefits of this Agreement
	 	 	35	 
	Section 31. Severability
	 	 	35	 
	Section 32. Governing Law
	 	 	36	 
	Section 33. Counterparts; Facsimiles and PDFs
	 	 	36	 
	Section 34. Descriptive Headings
	 	 	36	 
	Section 35. Force Majeure
	 	 	36	 
	 	 	 	 
	Exhibit A Form of Certificate of Designation, Preferences, and Rights
	 	 	 	 
	Exhibit B Form of Rights Certificate
	 	 	 	 
	Exhibit C Form of Summary of Rights to Purchase Preferred Stock
	 	 	 	 

 

 

 

RIGHTS AGREEMENT

RIGHTS AGREEMENT, dated as of December 13, 2010 (this “Agreement”), between Spectrum
Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Computershare Trust
Company, N.A., a national banking association (the “Rights Agent”).

RECITAL

WHEREAS, on November 29, 2010 (the “Rights Dividend Declaration Date”), the Board of
Directors of the Company authorized and declared a dividend distribution of one right (each, a
“Right”) for each Common Share (as hereinafter defined) outstanding at the Close of
Business (as hereinafter defined) on December 13, 2010 (the “Record Date”), and further
authorized and directed the issuance of one Right (as such number may hereinafter be adjusted
pursuant hereto) with respect to each Common Share issued between the Record Date (whether
originally issued or delivered from the Company’s treasury) and, except as otherwise provided in
Section 22, the earlier of the Distribution Date and the Expiration Date (as such terms are
hereinafter defined), each Right initially representing the right to purchase one one-thousandth of
a Preferred Share (as hereinafter defined), upon the terms and subject to the conditions
hereinafter set forth.

AGREEMENT

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

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

(a) “Acquiring Person” shall mean any Person who or which, together with all
Affiliates and Associates of such Person, shall be the Beneficial Owner of 15% or more of the
Common Shares then outstanding, but shall not include an Exempt Person. Notwithstanding the
foregoing:

(i) any Person who becomes the Beneficial Owner of 15% or more of the Common Shares then
outstanding as a result of a reduction in the number of Common Shares outstanding due to the
repurchase of Common Shares by the Company shall not be deemed an “Acquiring Person” unless and
until such Person acquires Beneficial Ownership of any additional Common Shares (other than as a
result of a stock dividend, stock split, or similar transaction effected by the Company in which
all registered holders of Common Shares are treated substantially equally) while the Beneficial
Owner of 15% or more of the Common Shares then outstanding; and

 

 

 

(ii) if the Board of Directors of the Company determines in good faith that a Person who would
otherwise be an Acquiring Person has become such inadvertently (including, without limitation,
because (A) such Person was unaware that it Beneficially Owned a percentage of Common 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 Agreement and had no intention of changing or influencing control
of the Company), and such Person divests as promptly as practicable a sufficient number of Common
Shares so that such Person is no longer the Beneficial Owner of 15% or more of the Common Shares
then outstanding then such Person shall not be deemed to be or ever to have been an “Acquiring
Person” for any purposes of this Agreement as a result of such inadvertent acquisition.

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

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

(d) “Affiliate” and “Associate” shall have the respective meanings ascribed to
such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange Act as in effect
on the date of this Agreement.

(e) “Agreement” shall have the meaning set forth in the preamble hereto.

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

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

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

 

2

 

(iii) which such Person or any of such Person’s Affiliates or Associates, directly or
indirectly, has the right to vote or dispose of, including pursuant to
any agreement, arrangement, or understanding (whether or not in writing); provided,
however, that a Person shall not be deemed the “Beneficial Owner” of, to have “Beneficial
Ownership” of, or to “beneficially own,” any security as a result of an agreement, arrangement, or
understanding (whether or not in writing) to vote such security if such agreement, arrangement, or
understanding: (A) arises solely from a revocable proxy (as such term is defined in Regulation 14A
under the Exchange Act) given in response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable provisions of the General Rules and Regulations under
the Exchange Act, including the disclosure requirements of Schedule 14A thereunder, and (B) is not
also then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or
successor report); or

(iv) which are beneficially owned, directly or indirectly, by any other Person (or any
Affiliate or Associate thereof) with which such Person (or any of such Person’s Affiliates or
Associates) has any agreement, arrangement, or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting (except pursuant to a revocable proxy as described in the
proviso to Section 1(f)(iii)), or disposing of any voting securities of the Company;

provided, however, that nothing in this Section 1(f) shall cause a Person engaged
in business as an underwriter of securities to be the “Beneficial Owner” of, to have “Beneficial
Ownership” of, or to “beneficially own,” any securities acquired or which such Person has the right
to acquire through such Person’s participation in good faith in a firm commitment underwriting
until the expiration of 40 days after the date of such acquisition, and then only if such
securities continue to be owned by such Person at such expiration of 40 days.

(g) “Business Day” shall mean any day other than a Saturday, Sunday, or a day on which
banking institutions in the Commonwealth of Massachusetts are authorized or obligated by law or
executive order to close.

(h) “Certificate of Incorporation” shall mean the Company’s Amended Certificate of
Incorporation, as such may be amended, modified, or restated from time to time.

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

(j) “Common Shares” shall mean the shares of common stock, par value $0.001 per share,
of the Company, except that “Common Shares” when used with reference to any Person other
than the Company shall mean the capital stock of such Person with the greatest voting power, or the
equity securities or other equity interests having power to control or direct the management of
such Person.

 

3

 

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

(l) “Company” shall have the meaning set forth in the preamble hereto, except as
otherwise provided in Section 13(a) hereof.

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

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

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

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

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

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

(s) “Exempt Person” shall mean (i) the Company, (ii) any Subsidiary of the Company,
(iii) any employee benefit plan of the Company or of any Subsidiary of the Company, or (iv) any
Person or entity organized, appointed, or established by the Company or any Subsidiary of the
Company for or pursuant to the terms of any such employee benefit plan.

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

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

(v) “Original Rights” shall have the meaning set forth in Section 1(f)(ii) hereof.

(w) “Ownership Statement” shall have the meaning set forth in Section 3(a) hereof.

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

 

4

 

(y) “Preferred Shares” shall mean shares of Series B Junior Participating Preferred
Stock, par value $0.001 per share, of the Company having the rights and
preferences set forth in the Certificate of Designation attached to this Agreement as
Exhibit A, and, to the extent that there are not a sufficient number of shares of Series B
Junior Participating Preferred Stock authorized to permit the full exercise of the Rights, any
other series of preferred stock of the Company designated for such purpose containing terms
substantially similar to the terms of the Series B Junior Participating Preferred Stock.

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

(aa) “Purchase Price” shall have the meaning set forth in Section 7(b) hereof.

(bb) “Record Date” shall have the meaning set forth in the recital to this Agreement.

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

(dd) “Right” shall have the meaning set forth in the recital to this Agreement.

(ee) “Rights Agent” shall have the meaning set forth in the preamble hereto, except as
otherwise provided in Section 19 and Section 21 hereof.

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

(gg) “Rights Dividend Declaration Date” shall have the meaning set forth in the
recital to this Agreement.

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

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

(jj) “Section 13 Event” shall mean any event described in Section 13(a)(i),
Section 13(a)(ii), or Section 13(a)(iii) hereof.

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

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

 

5

 

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

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

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

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

(qq) “Triggering Event” shall mean a Section 11(a)(ii) Event or any Section 13 Event.

(rr) “Trust” shall have the meaning set forth in Section 24(f) hereof.

(ss) “Trust Agreement” shall have the meaning set forth in Section 24(f) hereof.

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

Section 3. Issuance of Rights Certificates.

(a) Until the earlier of (i) the Close of Business on the 10th day after the Shares
Acquisition Date (or, if the 10th day after the Shares Acquisition Date occurs before the Record
Date, the Close of Business on the Record Date) and (ii) the Close of Business on the 10th Business
Day (or such later date as the Board of Directors of the Company may determine prior to the
occurrence of a Section 11(a)(ii) Event) after the date of commencement by or on behalf of any
Person (other than an Exempt Person) of a tender offer or exchange offer, if upon consummation
thereof, such Person would become an Acquiring Person (the earlier of (i) and (ii) being herein
referred to as the “Distribution Date”), (A) the Rights will be evidenced (subject to
Section 3(b) and Section 3(c) hereof) by the certificates for the Common Shares registered in the
names of the holders of the Common Shares (which certificates for Common Shares shall be deemed
also to be certificates for Rights) or by the current ownership statements issued with respect to
uncertificated Common Shares in lieu of such certificates (“Ownership Statements”) (which
Ownership Statements shall be deemed also to be

 

6

 

certificates
for Rights) and not by separate certificates, and the registered holders of the Common Shares shall also be the
registered holders of the associated Rights, and (B) the Rights will be transferable only in
connection with the transfer of the underlying Common Shares (including a transfer to the Company);
provided, however, that, if a tender offer or exchange offer is terminated prior to
the occurrence of a Distribution Date, then no Distribution Date shall occur as a result of such
tender offer or exchange offer. As soon as practicable after the Distribution Date, the Rights
Agent will send, in accordance with Section 26 hereof, to each record holder of the Common Shares
as of the Close of Business on the Distribution Date (other than an Acquiring Person or any
Associate or Affiliate of an Acquiring Person), one or more rights certificates, in substantially
the form of Exhibit B hereto (the “Rights Certificates”), evidencing one Right for
each Common Share so held, subject to adjustment as provided herein. In the event that an
adjustment in the number of Rights per Common Share has been made pursuant to Section 11(i) or
Section 11(p) hereof, at the time of distribution of the Rights Certificates, the Company shall not
be required to issue Rights Certificates evidencing fractional Rights but may, in lieu thereof,
make the necessary and appropriate rounding adjustments (in accordance with Section 14(a) hereof)
so that Rights Certificates evidencing only whole numbers of Rights are distributed and cash is
paid in lieu of any fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.

(b) As promptly as practicable following the Record Date, the Company shall send a copy of a
Summary of Rights, in substantially the form attached hereto as Exhibit C (the “Summary
of Rights”), to each record holder of Common Shares as of the Close of Business on the Record
Date in accordance with Section 26 hereof. With respect to Common Shares outstanding as of the
Record Date, until the earlier of the Distribution Date and the Expiration Date, the Rights
associated with such Common Shares will be evidenced by the certificate or Ownership Statement for
such Common Shares registered in the names of the holders thereof, in each case together with the
Summary of Rights. Until the earlier of the Distribution Date and the Expiration Date, the
surrender for transfer of any certificate or Ownership Statement for Common Shares outstanding on
the Record Date, with or without a copy of the Summary of Rights, shall also constitute the
transfer of the Rights associated with the Common Shares evidenced by such certificate or Ownership
Statement.

(c) Rights shall be issued in respect of all Common Shares that are issued (whether originally
issued or from the Company’s treasury) after the Record Date but prior to the earlier of the
Distribution Date and the Expiration Date and, to the extent provided in Section 22 hereof, in
respect of Common Shares issued after the Distribution Date. Certificates and Ownership Statements
evidencing such Common Shares shall have printed or otherwise affixed to them the following legend:

This [certificate/statement] also evidences and entitles the registered holder
hereof to certain Rights as set forth in the Rights Agreement between Spectrum
Pharmaceuticals, Inc. (the “Company”) and the Rights Agent thereunder dated as of
December 13, 2010 (the “Rights Agreement”), the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the principal
offices of the Company. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will be evidenced
by separate certificates and will no longer be evidenced by this
[certificate/statement]. The Company will mail to the registered holder of this
[certificate/statement] a copy of the Rights Agreement, as in effect on the date
of mailing, without charge, promptly after receipt of a written request therefor.
Under certain circumstances set forth in the Rights Agreement, Rights beneficially
owned by any Person who is, was, or becomes an Acquiring Person or any Affiliate
or Associate thereof (as such terms are defined in the Rights Agreement), whether
currently beneficially owned by or on behalf of such Person or by any subsequent
beneficial owner, may become null and void.

 

7

 

With respect to such certificates or Ownership Statements containing the foregoing legend, until
the earlier of the Distribution Date and the Expiration Date, the Rights associated with the Common
Shares evidenced by such certificates or Ownership Statements shall be evidenced by such
certificates or Ownership Statements alone and the surrender for transfer of any certificate or
Ownership Statement for Common Shares shall also constitute the transfer of the Rights associated
with the Common Shares evidenced by such certificate or Ownership Statement. In the event 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 shall be deemed cancelled and
retired so that the Company shall not be entitled to exercise any Rights associated with such
Common Shares that are no longer outstanding.

Section 4. Form of Rights Certificates. The Rights Certificates (and the forms of
election to purchase and of assignment and the certificates contained therein to be printed on the
reverse thereof) shall each be substantially in the form attached hereto as Exhibit B and
may have such marks of identification or designation and such legends, summaries, or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent with the provisions
of this Agreement, or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the
Rights may from time to time be listed, or to conform to usage. Subject to the provisions of
Section 22 hereof, the Rights Certificates, whenever distributed, shall be dated as of the Record
Date and on their face shall entitle the registered holders thereof to purchase such number of one
one-thousandths of a Preferred Share as shall be set forth therein at the Purchase Price, but the
amount and type of securities purchasable upon the exercise of each Right and the Purchase Price
thereof shall be subject to adjustment as provided herein.

Section 5. Countersignature and Registration.

(a) The Rights Certificates shall be executed on behalf of the Company by its Chairman of the
Board, its Chief Executive Officer, its President, or any Vice President, either manually or by
facsimile signature, and shall have affixed thereto the Company’s seal or a facsimile thereof which
shall be attested by the Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be countersigned by an authorized signatory of
the Rights Agent, either
manually or by facsimile signature, and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before countersignature by an authorized
signatory of the Rights Agent and issuance and delivery by the Company, such Rights Certificates,
nevertheless, may be countersigned by an authorized signatory of the Rights Agent and issued and
delivered by the Company with the same force and effect as though the person who signed such Rights
Certificates had not ceased to be such officer of the Company; and any Rights Certificates may be
signed on behalf of the Company by any person who, at the actual date of the execution of such
Rights Certificate, shall be a proper officer of the Company to sign such Rights Certificate,
although at the date of the execution of this Agreement any such person was not such an officer.

 

8

 

(b) Following the Distribution Date, the Rights Agent will keep, or cause to be kept, at its
principal office or offices designated as the appropriate place for surrender of Rights
Certificates upon exercise or transfer, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the names and addresses of the respective
holders of the Rights Certificates, the number of Rights evidenced on its face by each of the
Rights Certificates, and the date of each of the Rights Certificates.

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

(a) Subject to the provisions of Section 7(e) and Section 14 hereof, at any time after the
Close of Business on the Distribution Date, and at or prior to the Close of Business on the
Expiration Date, any Rights Certificate or Certificates (other than Rights Certificates evidencing
Rights that have been redeemed or exchanged pursuant to Section 23 or Section 24 hereof) may be
transferred, split-up, combined, or exchanged for another Rights Certificate or Certificates,
entitling the registered holder to purchase a like number of one one-thousandths of a Preferred
Share (or, following the occurrence of a Triggering Event, Common Shares, other securities, cash,
or other assets, as the case may be) as the Rights Certificate or Certificates surrendered then
entitles such holder (or former holder in the case of a transfer) to purchase. Any registered
holder desiring to transfer, split-up, combine, or exchange any Rights Certificate or Certificates
shall make such request in writing delivered to the Rights Agent, and shall surrender the Rights
Certificate or Certificates to be transferred, split-up, combined, or exchanged, with the form of
assignment and certificate contained therein duly executed, at the principal office or offices of
the Rights Agent designated for such purpose. Neither the Rights Agent nor the Company shall be
obligated to take any action whatsoever with respect to the transfer of any such surrendered Rights
Certificate until the registered holder shall have completed and signed the certificate contained
in the form of assignment on the reverse side of such Rights Certificate and shall have provided
such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request. Thereupon the Rights
Agent shall, subject to Section 7(e), Section 14, and Section 24 hereof, countersign and deliver to
the Person entitled thereto a Rights Certificate or Rights Certificates, as the case may be, as so
requested. The Company may require payment from a registered holder of a Rights
Certificate of a sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split-up, combination, or exchange of Rights Certificates.

 

9

 

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

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

(a) Subject to Section 7(e) hereof, at any time after the Distribution Date the registered
holder of any Rights Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein including, without limitation, the restrictions on exercisability set forth in
Section 9(c), Section 11(a)(iii), and Section 23(a) hereof) in whole or in part upon surrender of
the Rights Certificate, with the form of election to purchase and the certificate contained therein
duly executed, to the Rights Agent at the principal office or offices of the Rights Agent
designated for such purpose, together with payment of the aggregate Purchase Price with respect to
the total number of one one-thousandths of a Preferred Share (or, following the occurrence of a
Triggering Event, Common Shares, other securities, cash, or other assets, as the case may be) as to
which such surrendered Rights are then exercisable, at or prior to the earliest of (i) the Close of
Business on December 13, 2020 (“Final Expiration Date”), (ii) the time at which the Rights
are redeemed as provided in Section 23 hereof, and (iii) the time at which the Rights are exchanged
in full as provided in Section 24 hereof (the earliest of (i), (ii), and (iii) being herein
referred to as the “Expiration Date”).

(b) The purchase price for each one one-thousandth of a Preferred Share pursuant to the
exercise of a Right initially shall be $50.00, shall be subject to adjustment from time to time as
provided in Section 11 and Section 13(a) hereof, and shall be payable in accordance with
Section 7(c) hereof (such purchase price, as so adjusted, the “Purchase Price”).

 

10

 

(c) Upon receipt of a Rights Certificate evidencing exercisable Rights, with the form of
election to purchase and the certificate contained therein duly executed, accompanied by payment,
with respect to each Right so exercised, of the Purchase Price per one one-thousandth of a
Preferred Share (or, following the occurrence of a Triggering Event, Common Shares, other
securities, cash, or other assets, as the case may be) to be purchased as set forth below and an
amount equal to any applicable transfer tax, the Rights Agent shall, subject to Section 20(k)
hereof, thereupon promptly (i) (A) requisition from any transfer agent of the Preferred Shares (or
make available, if the Rights Agent is the transfer agent for such shares) certificates for the
total number of one one-thousandths of a
Preferred Share to be purchased and the Company hereby irrevocably authorizes its transfer
agent to comply with all such requests, or (B) if the Company shall have elected to deposit the
total number of Preferred Shares issuable upon exercise of the Rights hereunder with a depositary
agent, requisition from the depositary agent depositary receipts evidencing such number of one
one-thousandths of a Preferred Share as are to be purchased (in which case certificates for the
Preferred Shares evidenced by such receipts shall be deposited by the transfer agent with the
depositary agent) and the Company will direct the depositary agent to comply with such request,
(ii) requisition from the Company the amount of cash, if any, to be paid in lieu of fractional
shares in accordance with Section 14 hereof, (iii) after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of the registered holder of such
Rights Certificate, registered in such name or names as may be designated by such holder, and
(iv) after receipt thereof, deliver such cash, if any, to or upon the order of the registered
holder of such Rights Certificate. The payment of the Purchase Price (as such amount may be
reduced pursuant to Section 11(a)(iii) hereof) shall be made in cash or by certified bank check or
bank draft payable to the order of the Company. In the event that the Company is obligated to
issue other securities (including Common Shares) of the Company, pay cash, or distribute other
property pursuant to Section 11(a) hereof, the Company will make all arrangements necessary so that
such other securities, cash, or other property are available for distribution by the Rights Agent,
if and when appropriate. The Company reserves the right to require prior to the occurrence of a
Triggering Event that, upon any exercise of Rights, a number of Rights be exercised so that only
whole Preferred Shares would be issued.

(d) In case the registered holder of any Rights Certificate shall exercise less than all the
Rights evidenced thereby, a new Rights Certificate evidencing the Rights remaining unexercised
shall be issued by the Rights Agent and delivered to, or upon the order of, the registered holder
of such Rights Certificate, registered in such name or names as may be designated by such holder,
subject to the provisions of Section 14 hereof.

(e) Notwithstanding anything in this Agreement to the contrary, from and after the first
occurrence of a Section 11(a)(ii) Event, any Rights beneficially owned by (i) an Acquiring Person
or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee after the Acquiring Person becomes
such, or (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring Person becoming such and receives
such Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring
Person (or any such Associate of Affiliate) to holders of equity interests in such Acquiring Person
(or any such Associate or Affiliate) or to any Person with whom the Acquiring Person (or any such
Associate of Affiliate) has any continuing agreement, arrangement, or understanding (whether or not
in writing) regarding the transferred Rights or (B) a transfer that the Board of Directors of the
Company, in its sole discretion, has determined is part of a plan, arrangement, or understanding
(whether or not in writing) that has as a primary purpose or effect the avoidance of the provisions
of this Section 7(e), shall become null and void without any further action and no holder of such
Rights shall have any rights whatsoever with respect to such Rights, whether under any provision of
this Agreement or otherwise.
The Company shall use all reasonable efforts to ensure that the provisions of this
Section 7(e) are complied with, but shall have no liability to any holder of Rights Certificates or
any other Person as a result of its failure to make any determinations with respect to an Acquiring
Person or any of its Affiliates, Associates, or transferees hereunder.

 

11

 

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

Section 8. Cancellation and Destruction of Rights Certificates. All Rights
Certificates surrendered for the purpose of exercise, transfer, split-up, combination, or exchange
shall, if surrendered to the Company or any of its agents, be delivered to the Rights Agent for
cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled by
it, and no Rights Certificates shall be issued in lieu thereof except as expressly permitted by any
of the provisions of this Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Rights
Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The
Rights Agent shall deliver all cancelled Rights Certificates to the Company, or shall, at the
written request of the Company, destroy such cancelled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.

Section 9. Reservation and Availability of Capital Stock.

(a) The Company covenants and agrees that it will cause to be reserved and kept available out
of its authorized and unissued Preferred Shares, the number of Preferred Shares that will be
sufficient to permit the exercise in full of all outstanding Rights in accordance with Section 7
hereof.

(b) So long as the Preferred Shares (and, following the occurrence of a Triggering Event,
Common Shares or other securities, as the case may be) issuable and deliverable upon the exercise
of the Rights may be listed on any national securities exchange or quoted on a quotation system,
the Company shall use its best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for such issuance to be listed on such exchange or quoted on such
quotation system, as the case may be, upon official notice of issuance upon such exercise.

 

12

 

(c) The Company shall use its best efforts to (i) file, as soon as practicable following the
earliest date after the first occurrence of a Section 11(a)(ii) Event on which the consideration to
be delivered by the Company upon exercise of the Rights has been determined in accordance with
Section 11(a) hereof, a registration statement on an appropriate form under the Act, with respect
to the securities purchasable upon exercise
of the Rights, (ii) cause such registration statement to become effective as soon as
practicable after such filing, and (iii) cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the Act) until the earlier of (A) the
date as of which the Rights are no longer exercisable for such securities, and (B) the date of the
expiration of the Rights. The Company will also take such action as may be appropriate under, or
to ensure compliance with, the securities or “blue sky” laws of the various states in connection
with the exercisability of the Rights. The Company may temporarily suspend, for a period of time
not to exceed 90 days after the date set forth in clause (i) of the first sentence of this
Section 9(c), the exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective. Upon any such suspension, the Company shall issue a
public announcement stating that the exercisability of the Rights has been temporarily suspended,
as well as a public announcement at such time as the suspension is no longer in effect. In
addition, if the Company shall determine that a registration statement is required following the
Distribution Date, the Company similarly may temporarily suspend the exercisability of the Rights
until such time as a registration statement has been declared effective. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite qualification in such jurisdiction shall not have been obtained, or
the exercise thereof shall not be permitted under applicable law, or a registration statement shall
not have been declared effective.

(d) The Company covenants and agrees that it will take all such action as may be necessary to
ensure that all one one-thousandths of a Preferred Share (and, following the occurrence of a
Triggering Event, Common Shares or other securities, as the case may be) delivered upon exercise of
the Rights shall, at the time of delivery of the certificates for such shares (subject to payment
of the Purchase Price), be duly and validly authorized and issued and fully paid and nonassessable.

(e) The Company further covenants and agrees that it will pay when due and payable any and all
federal and state transfer taxes and charges that may be payable in respect of the issuance or
delivery of the Rights Certificates and of any certificates for a number of one one-thousandths of
a Preferred Share (or, following the occurrence of a Triggering Event, Common Shares or other
securities, as the case may be) upon the exercise of Rights. The Company shall not, however, be
required to pay any transfer tax that may be payable in respect of any transfer or delivery of
Rights Certificates to a Person other than, or the issuance or delivery of a number of one
one-thousandths of a Preferred Share (or, following the occurrence of a Triggering Event, Common
Shares or other securities, as the case may be) in a name other than that of the registered holder
of the Rights Certificates evidencing Rights surrendered for exercise or to issue or deliver any
certificates for a number of one one-thousandths of a Preferred Share (or, following the occurrence
of a Triggering Event, Common Shares or other securities, as the case may be) in a name other than
that of the registered holder upon the exercise of any Rights until such tax shall have been paid
(any such tax being payable by the registered holder of such Rights Certificates at the time of
surrender) or until it has been established to the Company’s satisfaction that no such tax is due.

 

13

 

Section 10. Preferred Shares Record Date. Each person in whose name any certificate
for a number of one one-thousandths of a Preferred Share (or, following the occurrence of a
Triggering Event, Common Shares or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of record of such
fractional Preferred Shares (or, following the occurrence of a Triggering Event, Common Shares or
other securities, as the case may be) evidenced thereby on, and such certificate shall be dated,
the date upon which the Rights Certificate evidencing such Rights was duly surrendered and payment
of the Purchase Price (and all applicable transfer taxes) was made; provided,
however, that, if the date of such surrender and payment is a date upon which the Preferred
Shares (or, following the occurrence of a Triggering Event, Common Shares or other securities, as
the case may be) transfer books of the Company are closed, such Person shall be deemed to have
become the record holder of such shares (fractional or otherwise) on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Shares (or, following the occurrence
of a Triggering Event, Common Shares or other securities, as the case may be) transfer books of the
Company are open. Prior to the exercise of the Rights evidenced thereby, the registered holder of
a Rights Certificate shall not be entitled to any rights of a stockholder of the Company with
respect to shares for which the Rights shall be exercisable, including, without limitation, the
right to vote, to receive dividends or other distributions, or to exercise any preemptive rights,
and shall not be entitled to receive any notice of any proceedings of the Company, except as
provided herein.

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

(a) (i) In the event the Company shall at any time after the date of this Agreement
(A) declare or pay a dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide or
split the outstanding Preferred Shares, (C) combine or consolidate the outstanding Preferred Shares
into a smaller number of shares, or (D) issue any shares of its capital stock in a reclassification
of the Preferred Shares (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a) and Section 7(e) hereof, the Purchase Price in effect at the time of
the record date for such dividend or of the effective date of such subdivision, split, combination,
consolidation, or reclassification, and the number and kind of Preferred Shares (or other capital
stock, as the case may be), issuable on such date, shall be proportionately adjusted so that the
registered holder of any Right exercised after such time shall be entitled to receive, upon payment
of the Purchase Price then in effect, the aggregate number and kind of Preferred Shares (or other
capital stock, as the case may be), which, if such Right had been exercised immediately prior to
such date (whether or not such Right was then exercisable) and at a time when the Preferred Share
(or other capital stock, as the case may be) transfer books of the Company were open, such holder
would have owned upon such exercise and been entitled to receive by virtue of such dividend,
subdivision, split, combination, consolidation, or reclassification. If an event occurs that would
require an adjustment under both this Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment
provided for in
this Section 11(a)(i) shall be in addition to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii) hereof.

 

14

 

(ii) In the event any Person shall become an Acquiring Person (a “Section 11(a)(ii)
Event”), then, promptly following the occurrence of such Section 11(a)(ii) Event, proper
provision shall be made so that each registered holder of a Right (except as provided below and in
Section 7(e) hereof) shall thereafter have the right to receive, upon exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement, in lieu of a number of one
one-thousandths of a Preferred Share, such number of Common Shares of the Company as shall equal
the result obtained by (A) multiplying the then current Purchase Price by the then number of one
one-thousandths of a Preferred Share for which a Right was exercisable immediately prior to the
first occurrence of a Section 11(a)(ii) Event, and (B) dividing that product (which, following such
first occurrence, shall thereafter be referred to as the “Purchase Price” for each Right
and for all purposes of this Agreement) by 50% of the Current Market Price per Common Share on the
date of such first occurrence (such number of shares, the “Adjustment Shares”).

(iii) In the event that (A) the number of Common Shares authorized by the Company’s
Certificate of Incorporation, but which are not outstanding or reserved for issuance for purposes
other than upon exercise of the Rights, are not sufficient to permit the exercise in full of the
Rights in accordance with Section 11(a)(ii) hereof or (B) the Board of Directors of the Company
otherwise shall determine to do so in its sole discretion, the Company, acting by resolution of the
Board of Directors of the Company, shall (1) determine the value of the Adjustment Shares issuable
upon the exercise of a Right (the “Current Value”), and (2) with respect to each Right
(subject to Section 7(e) hereof), make adequate provision to substitute for the Adjustment Shares,
upon the exercise of such Right and payment of the applicable Purchase Price, (u) cash, (v) a
reduction in the Purchase Price, (w) Common Shares or other equity securities of the Company
(including, without limitation, shares, or units of shares, of preferred stock, such as the
Preferred Shares, which the Board of Directors of the Company has deemed to have essentially the
same value or economic rights as Common Shares (such shares of preferred stock being referred to as
“Common Stock Equivalents”)), (x) debt securities of the Company, (y) other assets, or
(z) any combination of the foregoing, having an aggregate value equal to the Current Value, where
such aggregate value has been determined by the Board of Directors of the Company based upon the
advice of a nationally recognized investment banking firm selected by the Board of Directors of the
Company; provided, however, that, if, under the circumstances set forth in
clause (A) above, the Company shall not have made adequate provision to deliver value pursuant to
clause (2) above within 30 days following the later of (I) the first occurrence of a
Section 11(a)(ii) Event and (II) the date on which the Company’s right of redemption pursuant to
Section 23(a) hereof expires (the later of (I) and (II) being referred to herein as the
“Section 11(a)(ii) Trigger Date”), then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of the Purchase Price, Common
Shares (to the extent available) and then, if necessary, cash, which shares and cash have an
aggregate value equal to the Spread. For purposes of the preceding sentence, the term
“Spread” shall mean the excess of the Current Value over the Purchase

 

15

 

Price. If the Board
of Directors of the Company determines in good faith that it is likely that sufficient additional Common Shares
could be authorized for issuance upon exercise in full of the Rights, the 30-day period set forth
above may be extended to the extent necessary, but not more than 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 30-day period, as it may be extended, is herein
called the “Substitution Period”). To the extent that action is to be taken pursuant to
the first or third sentences of this Section 11(a)(iii), the Company shall provide, subject to
Section 7(e) hereof, that such action shall apply uniformly to all outstanding Rights, and the
Company may suspend the exercisability of the Rights until the expiration of the Substitution
Period in order to seek such stockholder approval for such authorization of additional shares or to
decide the appropriate form of distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily suspended, as well
as a public announcement at such time as the suspension is no longer in effect. For purposes of
this Section 11(a)(iii), the value of each Adjustment Share shall be the Current Market Price per
Common Share on the Section 11(a)(ii) Trigger Date and the per share or per unit value of any
Common Stock Equivalent shall be deemed to equal the Current Market Price per Common Share on such
date.

(b) In case the Company shall fix a record date for the issuance of rights, options, or
warrants to all registered holders of Preferred Shares entitling them to subscribe for or purchase
(for a period expiring within 45 calendar days after such record date) Preferred Shares (or shares
having the same rights, privileges, and preferences as the Preferred Shares (“Equivalent
Preferred Shares”)) or securities convertible into Preferred Shares or Equivalent Preferred
Shares at a price per Preferred Share or Equivalent Preferred Share (or having a conversion price
per share, if a security convertible into Preferred Shares or Equivalent Preferred Shares) less
than the Current Market Price per Preferred Share on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which shall be the number of
Preferred Shares outstanding on such record date plus the number of Preferred Shares that the
aggregate subscription or offering price of the total number of Preferred Shares or Equivalent
Preferred Shares so to be offered (or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such Current Market Price, and the denominator of
which shall be the number of Preferred Shares outstanding on such record date plus the number of
additional Preferred Shares or Equivalent Preferred Shares to be offered for subscription or
purchase (or into which the convertible securities so to be offered are initially convertible). In
case such subscription price may be paid by delivery of consideration, part or all of which may be
in a form other than cash, the value of such consideration shall be as determined in good faith by
the Board of Directors of the Company, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes. Preferred Shares owned by or held
for the account of the Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustments shall be made successively whenever such a record date is fixed, and
in the event that such rights, options, or warrants are not so issued, the Purchase
Price shall be adjusted to be the Purchase Price that would then be in effect if such record
date had not been fixed.

 

16

 

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

(d) (i) For the purpose of any computation hereunder, other than computations made pursuant
to Section 11(a)(iii) hereof, the “Current Market Price” per Common Share on any date shall
be deemed to be the average of the daily closing prices per Common Share for the 30 consecutive
Trading Days immediately prior to such date, and for purposes of computations made pursuant to
Section 11(a)(iii) hereof, the “Current Market Price” per Common Share on any date shall be
deemed to be the average of the daily closing prices per Common Share for the 10 consecutive
Trading Days immediately following such date; provided, however, that in the event
that the Current Market Price per Common Share is determined during a period following the
announcement by the issuer of such Common Share of (A) a dividend or distribution on such Common
Shares payable in Common Shares or securities convertible into such Common Shares (other than the
Rights), or (B) any subdivision, combination, or reclassification of such Common Shares, and the
ex-dividend date for such dividend or distribution, or the record date for such subdivision,
combination, or reclassification shall not have occurred prior to the commencement of the requisite
30-Trading Day or 10-Trading Day period, as set forth above, then, and in each such case, the
Current Market Price shall be properly adjusted to take into account ex-dividend trading. The
closing price for each day shall be the last sale price, regular way, or, in case no such sale
takes place on such day, the average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on the NASDAQ Stock Market or, if the Common Shares are
not listed or admitted to trading on the NASDAQ Stock Market, as reported in the principal
consolidated transaction reporting system with respect to securities listed

 

17

 

on the principal
national securities exchange on which the Common Shares are listed or admitted to trading or, if
the Common Shares 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 on a quotation system then in use, or, if on any such date the
Common Shares are not so quoted, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Common Shares selected by the Board of Directors
of the Company. If on any such date the Common Shares are not publicly held and are not so listed,
admitted to trading, or quoted, and no market maker is making a market in the Common Shares, the
“Current Market Price” per Common Share shall mean the fair value per share on such date as
determined in good faith by the Board of Directors of the Company, which determination shall be
described in a statement filed with the Rights Agent and shall be conclusive for all purposes. The
term “Trading Day” shall mean a day on which the principal national securities exchange on
which the Common Shares are listed or admitted to trading is open for the transaction of business
or, if the Common Shares are not listed or admitted to trading on any national securities exchange,
a Business Day.

(ii) For the purpose of any computation hereunder, the “Current Market Price” per
Preferred Share shall be determined in the same manner as set forth above for the Common Shares in
Section 11(d)(i) hereof (other than the penultimate sentence thereof). If the Current Market Price
per Preferred Share cannot be determined in the manner provided above or if the Preferred Shares
are not publicly held or listed, admitted to trading, or quoted in a manner described in
Section 11(d)(i) hereof, the Current Market Price per Preferred Share shall be conclusively deemed
to be an amount equal to 1000 (as such number may be appropriately adjusted for such events as
stock splits, stock dividends, and recapitalizations with respect to the Common Shares occurring
after the date of this Agreement) multiplied by the Current Market Price per Common Share. If
neither the Common Shares nor the Preferred Shares are publicly held or listed, admitted to
trading, or quoted, the “Current Market Price” per Preferred Share shall mean the fair
value per share as determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and shall be conclusive
for all purposes. For all purposes of this Agreement, the Current Market Price of one
one-thousandth of a Preferred Share shall be equal to the Current Market Price of one Preferred
Share divided by 1000.

(e) Anything herein to the contrary notwithstanding, no adjustment in the Purchase Price shall
be required unless such adjustment would require an increase or decrease of at least 1% in the
Purchase Price; provided, however, that any adjustments which by reason of this
Section 11(e) are not required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or
to the nearest ten-thousandth of a Common Share or other share or one-millionth of a Preferred
Share, as the case may be. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later than the earlier of (i) three years
from the date of the transaction that mandates such adjustment and (ii) the Expiration Date.

 

18

 

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

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

(h) Unless the Company shall have exercised its election as provided in Section 11(i) hereof,
upon each adjustment of the Purchase Price as a result of the calculations made in Section 11(b)
and Section 11(c) hereof, each Right outstanding immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted Purchase Price, that number of one
one-thousandths of a Preferred Share (calculated to the nearest one-millionth) obtained by
(i) multiplying (A) the number of one one-thousandths of a share covered by a Right immediately
prior to this adjustment, by (B) the Purchase Price in effect immediately prior to such adjustment
of the Purchase Price, and (ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.

(i) The Company may elect on or after the date of any adjustment of the Purchase Price to
adjust the number of Rights, in lieu of any adjustment in the number of one one-thousandths of a
Preferred Share purchasable upon the exercise of a Right pursuant to Section 11(h) hereof. Each of
the Rights outstanding after the adjustment in the number of Rights shall be exercisable for the
number of one one-thousandths of a Preferred Share for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such adjustment of the number of
Rights shall become that number of Rights (calculated to the nearest one ten-thousandth) obtained
by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by
the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall
make a public announcement of its election to adjust the number of Rights, indicating the record
date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This
record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if
the Rights Certificates have been issued, shall be at least 10 days later than the date of the
public announcement. If Rights Certificates have been issued, upon each adjustment of the number
of Rights pursuant to this Section 11(i), the Company shall, as promptly as practicable, cause to
be distributed to holders of record of Rights Certificates on such record date Rights Certificates
evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the Rights Certificates
held by such holders prior to the date of adjustment, and upon surrender thereof, if required by
the Company,
new Rights Certificates evidencing all the Rights to which such holders shall be entitled
after such adjustment. Rights Certificates so to be distributed shall be issued, executed, and
countersigned in the manner provided for herein (and may bear, at the option of the Company, the
adjusted Purchase Price) and shall be registered in the names of the holders of record of Rights
Certificates on the record date specified in the public announcement.

 

19

 

(j) Irrespective of any adjustment or change in the Purchase Price or the number of one
one-thousandths of a Preferred Share issuable upon the exercise of the Rights, the Rights
Certificates theretofore and thereafter issued may continue to express the Purchase Price per one
one-thousandth of a share and the number of one one-thousandths of a share that were expressed in
the initial Rights Certificates issued hereunder.

(k) Before taking any action that would cause an adjustment reducing the Purchase Price below
the then stated value, if any, of the number of one one-thousandths of a Preferred Share issuable
upon exercise of the Rights, the Company shall take any corporate action that may, in the opinion
of its counsel, be necessary in order that the Company may validly and legally issue, fully paid
and nonassessable, such number of one one-thousandths of a Preferred Share at such adjusted
Purchase Price.

(l) In any case in which this Section 11 shall require that an adjustment in the Purchase
Price be made effective as of a record date for a specified event, the Company may elect to defer
until the occurrence of such event the issuance to the registered holder of any Right exercised
after such record date of the number of one one-thousandths of a Preferred Share and other capital
stock or securities of the Company, if any, issuable upon such exercise over and above the number
of one one-thousandths of a Preferred Share and other capital stock or securities of the Company,
if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such holder a due
bill or other appropriate instrument evidencing such holder’s right to receive such additional
shares (fractional or otherwise) or securities upon the occurrence of the event requiring such
adjustment.

(m) Anything in this Section 11 to the contrary notwithstanding, the Company shall be entitled
to make such reductions in the Purchase Price, in addition to those adjustments expressly required
by this Section 11, as and to the extent that in its good faith judgment the Board of Directors of
the Company shall determine to be advisable in order that any (i) consolidation or subdivision of
the Preferred Shares, (ii) issuance wholly for cash of any Preferred Shares at less than the
Current Market Price, (iii) issuance wholly for cash of Preferred Shares or securities that by
their terms are convertible into or exchangeable for Preferred Shares, (iv) stock dividends, or
(v) issuance of rights, options, or warrants referred to in this Section 11, hereafter made by the
Company to registered holders of its Preferred Shares shall not be taxable to such stockholders.

 

20

 

(n) The Company covenants and agrees that in the event that a Section 11(a)(ii) Event occurs
and the Rights shall then be outstanding, it shall not,
(i) consolidate with any other Person, (ii) merge with or into any other Person, or (iii) sell
or otherwise transfer (or permit any Subsidiary to sell or otherwise transfer), in one transaction,
or a series of related transactions, assets or earning power aggregating 50% or more of the assets
or earning power of the Company and its Subsidiaries (taken as a whole and calculated on the basis
of the Company’s most recent regularly prepared financial statements) to any other Person or
Persons, if (A) at the time of or immediately after such consolidation, merger, sale, or transfer
there are any charter or bylaw provisions, rights, warrants, or other instruments or securities
outstanding or agreements in effect that would substantially diminish or otherwise eliminate the
benefits intended to be afforded by the Rights or (B) prior to, simultaneously with, or immediately
after such consolidation, merger, sale, or transfer the stockholders of the Person who constitutes,
or would constitute, the “Principal Party” for purposes of Section 13(a) hereof shall have received
a distribution of Rights previously owned by such Person or any of its Affiliates and Associates.

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

(p) Anything in this Agreement to the contrary notwithstanding, in the event that the Company
shall at any time after the Rights Dividend Declaration Date and prior to the Distribution Date
(i) declare or pay a dividend on the outstanding Common Shares payable in Common Shares,
(ii) subdivide or split the outstanding Common Shares, or (iii) combine or consolidate the
outstanding Common Shares into a smaller number of shares, the number of Rights associated with
each Common Share then outstanding, or issued or delivered thereafter but prior to the Distribution
Date (or issued or delivered on or after the Distribution Date pursuant to Section 22 hereof),
shall be proportionately adjusted so that the number of Rights thereafter associated with each
Common Share following any such event shall equal the result obtained by multiplying the number of
Rights associated with each Common Share immediately prior to such event by a fraction, the
numerator of which shall be the total number of Common Shares outstanding immediately prior to the
occurrence of the event and the denominator of which shall be the total number of Common Shares
outstanding immediately following the occurrence of such event.

Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever an
adjustment is made as provided in Section 11 or Section 13 hereof, the Company shall (a) promptly
prepare a certificate setting forth such adjustment and a brief statement of the facts accounting
for such adjustment, (b) promptly file with the Rights Agent, and with each transfer agent for the
Preferred Shares and the Common Shares, a copy of such certificate, and (c) if a Distribution Date
has occurred, mail a brief summary thereof to each registered holder of a Rights Certificate in
accordance with Section 26 hereof. The Rights Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained.

 

21

 

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

(a) In the event that, at any time after a Person has become an Acquiring Person, directly or
indirectly,

(i) the Company shall consolidate with, or merge with and into, any other Person, and the
Company shall not be the continuing or surviving corporation or other entity of such consolidation
or merger;

(ii) any Person shall consolidate with, or merge with or into, the Company, and the Company
shall be the continuing or surviving corporation of such consolidation or merger and, in connection
with such consolidation or merger, all or part of the outstanding Common Shares shall be changed
into or exchanged for stock or other securities of any other Person (or the Company) or cash or any
other property; or

(iii) the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall
sell or otherwise transfer), in one transaction or a series of related transactions, assets or
earning power aggregating 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole and calculated on the basis of the Company’s most recent regularly
prepared financial statements) to any Person or Persons;

then, and in each such case, proper provision shall be made so that: (A) each registered holder of
a Right, except as provided in Section 7(e) hereof, shall thereafter have the right to receive,
upon the exercise thereof at the then current Purchase Price in accordance with the terms of this
Agreement, such number of validly authorized and issued, fully paid, non-assessable and freely
tradeable Common Shares of the Principal Party, not subject to any liens, encumbrances, rights of
first refusal, or other adverse claims, as shall be equal to the result obtained by (1) multiplying
the number of one one-thousandths of a Preferred Share for which a Right was exercisable
immediately prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase Price in
effect immediately prior to such first occurrence of a Section 11(a)(ii) Event, and (2) dividing
that product (which, following the first occurrence of a Section 13 Event, shall be referred to as
the “Purchase Price” for each Right and for all purposes of this Agreement) by 50% of the
Current Market Price per Common Share of such Principal Party on the date of consummation of such
Section 13 Event; (B) such Principal Party shall thereafter be liable for, and shall assume, by
virtue of such Section 13 Event, all the obligations and duties of the Company pursuant to this
Agreement; (C) the term “Company” shall thereafter be deemed to refer to such Principal
Party, it being specifically intended that the provisions of Section 11 hereof shall apply only to
such Principal Party following the first occurrence of a Section 13 Event; (D) such Principal Party
shall take such steps (including, but not limited to, the reservation of a sufficient number of
Common Shares) in connection with the consummation of any such transaction as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be,
in relation to its Common Shares thereafter deliverable upon the exercise of the Rights; and
(E) the provisions of Section 11(a)(ii) hereof shall be of no effect with respect to events
occurring at any time following the first occurrence of any Section 13 Event.

 

22

 

(b) “Principal Party” shall mean:

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

(ii) in the case of any transaction described in Section 13(a)(iii) hereof, the Person that is
the party receiving the greatest portion of the assets or earning power transferred pursuant to
such transaction or transactions or, if each Person that is a party to such transaction or
transactions receives the same portion of the assets or earning power transferred pursuant to such
transaction or transactions or if the Person receiving the largest portion of the assets or earning
power cannot be determined, whichever of such Persons is the issuer of Common Shares having the
greatest aggregate value of shares outstanding; provided, however, that, in any
such case, (A) if the Common Shares of such Person are not at such time and have not been
continuously over the preceding 12-month period registered under Section 12 of the Exchange Act,
and such Person is a direct or indirect Subsidiary of another Person the Common Shares of which are
and have been so registered, “Principal Party” shall refer to such other Person; and (B) in case
such Person is a Subsidiary, directly or indirectly, of more than one Person, the Common Shares of
two or more of which are and have been so registered, “Principal Party” shall refer to whichever of
such Persons is the issuer of the Common Shares having the greatest aggregate market value.

(c) The Company shall not consummate a Section 13 Event unless the Principal Party shall have
a sufficient number of authorized Common Shares that have not been issued or reserved for issuance
to permit the exercise in full of the Rights in accordance with this Section 13 and unless prior
thereto the Company and such Principal Party shall have executed and delivered to the Rights Agent
a supplemental agreement confirming that the requirements of Section 13(a) and Section 13(b) hereof
shall promptly be performed in accordance with their terms and further providing that, as soon as
practicable after the date of any such Section 13 Event, the Principal Party will:

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

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

 

23

 

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

The provisions of this Section 13 shall similarly apply to successive mergers or consolidations or
sales or other transfers. In the event that a Section 13 Event shall occur at any time after the
occurrence of a Section 11(a)(ii) Event, the Rights that have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section 13(a) hereof.

Section 14. Fractional Rights and Fractional Shares.

(a) The Company shall not be required to issue fractions of Rights, except prior to the
Distribution Date as provided in Section 11(p) hereof, or to distribute Rights Certificates that
evidence fractional Rights. In lieu of such fractional Rights, the Company shall pay to the
registered holders of the Rights Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the current market value of
a whole Right. For purposes of this Section 14(a), the current market value of a whole Right shall
be the closing price of the Rights for the Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The closing price of the Rights for any
Trading Day shall be the last sale price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, in either case as reported in
the principal consolidated transaction reporting system with respect to securities listed or
admitted to trading on the NASDAQ Stock Market or, if the Rights are not listed or admitted to
trading on the NASDAQ Stock Market, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities exchange on which the
Rights are listed or admitted to trading, or if the Rights are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter market, as reported by a quotation system
then in use or, if on any such date the Rights are not so quoted, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in the Rights,
selected by the Board of Directors of the Company. If on any such date the Rights are not publicly
held and are not so listed, admitted to trading, or quoted, and no market maker is making a market
in the Rights, the current market value of a Right shall mean the fair value of a Right on such
date as determined in good faith by the Board of Directors of the Company, which determination
shall be described in a statement filed with the Rights Agent and shall be conclusive for all
purposes.

(b) The Company shall not be required to issue fractions of Preferred Shares (other than
fractions that are integral multiples of one one-thousandth of a Preferred Share) upon exercise of
the Rights or to distribute certificates that evidence fractional Preferred Shares (other than
fractions that are integral multiples of one one-thousandth of a Preferred Share). In lieu of
fractional Preferred Shares that are not integral multiples of one one-thousandth of a Preferred
Share, the Company may pay to the registered holders
of Rights Certificates at the time such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market value of one one-thousandth of a Preferred
Share. For purposes of this Section 14(b), the current market value of one one-thousandth of a
Preferred Share shall be one one-thousandth of the closing price of a Preferred Share or, if
unavailable, the appropriate alternative price (in each case, as determined pursuant to
Section 11(d)(ii) hereof) for the Trading Day immediately prior to the date of such exercise.

 

24

 

(c) Following the occurrence of a Triggering Event, the Company shall not be required to issue
fractions of Common Shares upon exercise of the Rights or to distribute certificates or Ownership
Statements that evidence fractional Common Shares. In lieu of fractional Common Shares, the
Company may pay to the registered holders of Rights Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same fraction of the current market
value of one Common Share. For purposes of this Section 14(c), the current market value of one
Common Share shall be the closing price of one Common Share or, if unavailable, the appropriate
alternative price (in each case, as determined pursuant to Section 11(d)(i) hereof) on the Trading
Day immediately prior to the date of such exercise.

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

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

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

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

(b) after the Distribution Date, the Rights Certificates are transferable only on the registry
books of the Rights Agent if surrendered at the principal office or offices of the Rights Agent
designated for such purposes, duly endorsed or accompanied by a proper instrument of transfer and
with the appropriate forms and certificates contained therein duly executed;

 

25

 

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

(d) notwithstanding anything in this Agreement to the contrary, neither the Company nor the
Rights Agent shall have any liability to any registered holder of a Right or other Person as a
result of its inability to perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree, or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory, or administrative agency or commission, or
any statute, rule, regulation, or executive order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining performance of such obligation; provided,
however, that the Company must use its best efforts to have any such order, decree, or
ruling lifted or otherwise overturned as soon as possible.

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

 

26

 

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, reimbursement for
its reasonable expenses and counsel fees and disbursements and other disbursements incurred in the
administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The Company also agrees
to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability, or
expense, incurred without gross negligence, bad faith, or willful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including the costs and expenses of defending against any
claim of liability in the premises.

(b) The Rights Agent shall be protected and shall incur no liability for or in respect of any
action taken, suffered, or omitted by it in connection with its administration of this Agreement in
reliance upon any Rights Certificate or certificate for Common Shares or for other securities of
the Company or an Ownership Statement, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or other paper
or document believed by it to be genuine and to have been signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons.

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

(a) Any Person into which the Rights Agent or any successor Rights Agent may be merged or with
which it may be consolidated, or any Person resulting from any merger or consolidation to which the
Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the
corporate trust, stock transfer, or other shareholder services business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the parties hereto; but
only if such Person would be eligible for appointment as a successor Rights Agent under the
provisions of Section 21 hereof. In case at the time such successor Rights Agent shall succeed to
the agency created by this Agreement, any of the Rights Certificates shall have been countersigned
but not delivered, any such successor Rights Agent may adopt the countersignature of an authorized
signatory of a predecessor Rights Agent and deliver such Rights Certificates so countersigned; and
in case at that time any of the Rights Certificates shall not have been countersigned, an
authorized signatory of any successor Rights Agent may countersign such Rights Certificates either
in the name of the predecessor or in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in the Rights Certificates and in this
Agreement.

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

 

27

 

Section 20. Duties of the 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 registered holders of Rights Certificates, by their acceptance thereof, shall be
bound:

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

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

(c) The Rights Agent shall be liable hereunder only for its own gross negligence, bad faith,
or willful misconduct.

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

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

 

28

 

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

(g) The Rights Agent is hereby authorized and directed to accept instructions with respect to
the performance of its duties hereunder from the Chairman of the Board, the Chief Executive
Officer, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer,
or any Assistant Treasurer of the Company, and to apply to such officers for advice or instructions
in connection with its duties, and it shall not be liable for any action taken or suffered to be
taken by it in good faith in accordance with instructions of any such officer.

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

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

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

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

 

29

 

Section 21. Change of the 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 given
to the Company in accordance with Section 26 hereof, and in the event that the Rights Agent or one
of its Affiliates is not also the transfer agent for the Company, to each transfer agent of the
Common Shares and Preferred Shares by registered or
certified mail. In the event the transfer agency relationship in effect between the Company
and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and
be discharged from its duties under this Agreement as of the effective date of such termination,
and the Company shall be responsible for sending any required notice. The Company may remove the
Rights Agent or any successor Rights Agent upon 30 days’ notice given to the Rights Agent or
successor Rights Agent, as the case may be, in accordance with Section 26 hereof, and to each
transfer agent of the Common Shares and Preferred Shares by registered or certified mail, and, if
such removal occurs after the Distribution Date, to the registered holders of the Rights
Certificates in accordance with Section 26 hereof. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights
Agent. If the Company shall fail to make such appointment within a period of 30 days after giving
proper notice of such removal or after it has been properly notified of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the registered holder of a Rights
Certificate (who shall, with such notice, submit such holder’s Rights Certificate for inspection by
the Company), then any registered holder of any Rights Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent,
whether appointed by the Company or by such a court, shall be (a) a legal business entity organized
and doing business under the laws of the United States or of any state of the United States, in
good standing, which is authorized under such laws to exercise corporate trust, stock transfer, or
shareholder services powers and which has at the time of its appointment as Rights Agent a combined
capital and surplus of at least $50 million or (b) an affiliate of a legal business entity
described in clause (a) of this sentence. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties, and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver
and transfer to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act, or deed necessary for that purpose.
Not later than the effective date of any such appointment, the Company shall file notice thereof in
writing with the predecessor Rights Agent and each transfer agent of the Common Shares and the
Preferred Shares, and, if such appointment occurs after the Distribution Date, give notice thereof
to the registered holders of the Rights Certificates in accordance with Section 26 hereof. Failure
to give any notice provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.

Section 22. Issuance of New Rights Certificates. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company may, at its option,
issue new Rights Certificates evidencing Rights in such form as may be approved by the Board of
Directors of the Company to reflect any adjustment or change in the Purchase Price and the number
or kind or class of shares or other securities or property purchasable under the Rights
Certificates made in accordance with the provisions of this Agreement. In addition, in connection
with the issuance or sale of Common Shares following the Distribution Date and prior to the
Expiration Date, the Company (a) shall, with respect to Common Shares so issued or sold pursuant to
the exercise of stock options or under any employee plan or arrangement, granted or awarded as of
the Distribution
Date, or upon the exercise, conversion, or exchange of securities hereinafter issued by the
Company, and (b) may, in any other case, if deemed necessary or appropriate by the Board of
Directors of the Company, issue Rights Certificates evidencing the appropriate number of Rights in
connection with such issuance or sale; provided, however, that (i) no such Rights
Certificate shall be issued if, and to the extent that, the Company shall be advised by counsel
that such issuance would create a significant risk of material adverse tax consequences to the
Company or the Person to whom such Rights Certificate would be issued, and (ii) no such Rights
Certificate shall be issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.

 

30

 

Section 23. Redemption and Termination.

(a) The Board of Directors of the Company may, at its option, at any time prior to the earlier
of (i) the Close of Business on the 10th day following the Shares Acquisition Date (or, if the
10th day after the Shares Acquisition Date occurs before the Record Date, the Close of Business on
the Record Date) and (ii) the Final Expiration Date, direct the Company to, and if directed the
Company shall, redeem all but not less than all of the then outstanding Rights at a redemption
price of $0.001 per Right, as such amount may be appropriately adjusted to reflect any stock split,
stock dividend, or similar transaction occurring after the date hereof (such redemption price being
hereinafter referred to as the “Redemption Price”). Notwithstanding anything contained in
this Agreement to the contrary, the Rights shall not be exercisable after the first occurrence of a
Section 11(a)(ii) Event until such time as the right of redemption hereunder has expired. 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 of Directors of the Company.

(b) Immediately upon the action of the Board of Directors of the Company directing the Company
to redeem the Rights, evidence of which shall have been filed with the Rights Agent and without any
further action and without any notice, the right to exercise the Rights will terminate and the only
right thereafter of the registered holders of Rights shall be to receive the Redemption Price for
each Right so held. Promptly after the action of the Board of Directors of the Company directing
the Company to make the redemption of the Rights, the Company shall give notice of such redemption
to the Rights Agent and the registered holders of the then outstanding Rights in accordance with
Section 26 hereof. Any notice given in accordance with Section 26 hereof shall be deemed given
whether or not the holder receives the notice. Each such notice of redemption will state the
method by which the payment of the Redemption Price will be made.

Section 24. Exchange of Rights.

(a) The Board of Directors of the Company may, at its option, at any time after the occurrence
of a Section 11(a)(ii) Event, direct the Company to, and if directed the Company shall, exchange
all or part of the then outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 7(e) hereof) for Common Shares at an
exchange ratio of one Common Share per
Right, appropriately adjusted to reflect any stock split, stock dividend, or similar
transaction occurring after the date hereof (such exchange ratio being hereinafter referred to as
the “Exchange Ratio”). The exchange of the Rights by the Board of Directors of the Company
may be made effective at such time, on such basis, and with such conditions as the Board of
Directors of the Company in its sole discretion may establish. Notwithstanding the foregoing, the
Board of Directors of the Company shall not be empowered to direct the Company to effect such
exchange at any time after any Person (other than an Exempt Person), together with all Affiliates
and Associates of such Person, becomes the Beneficial Owner of 50% or more of the Common Shares
then outstanding.

 

31

 

(b) Immediately upon the action of the Board of Directors of the Company directing the Company
to exchange any Rights pursuant to Section 24(a) hereof and without any further action and without
any notice, the right to exercise such Rights shall terminate and the only right thereafter of a
registered holder of such Rights shall be to receive that number of Common Shares equal to the
number of such Rights held by such holder multiplied by the Exchange Ratio. The Company shall
promptly give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of such exchange. The
Company promptly shall give notice of any such exchange to all of the registered holders of such
Rights in accordance with Section 26 hereof. Any notice given in accordance with Section 26 hereof
shall be deemed given whether or not the holder receives the notice. Each such notice of exchange
will state the method by which the exchange of the Common Shares for Rights will be effected and,
in the event of any partial exchange, the number of Rights that will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than Rights that have
become void pursuant to the provisions of Section 7(e) hereof) held by each registered holder of
Rights.

(c) In any exchange pursuant to this Section 24, the Company, at its option, may substitute
Preferred Shares (or Equivalent Preferred Shares, as such term is defined in Section 11(b) hereof)
for Common Shares exchangeable for Rights, at the initial rate of one one-thousandth of a Preferred
Share (or Equivalent Preferred Shares) for each Common Share, as appropriately adjusted to reflect
stock splits, stock dividends, and other similar transactions after the date hereof.

(d) In the event the number of Common Shares authorized by the Company’s Certificate of
Incorporation, but which are not outstanding or reserved for issuance for purposes other than upon
exercise of the Rights, is not sufficient to permit any exchange of Rights as contemplated in
accordance with this Section 24, the Company may take all such action as may be necessary to
authorize additional Common Shares for issuance upon exchange of the Rights.

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

 

32

 

(f) Prior to effecting an exchange pursuant to this Section 24, the Board of Directors of the
Company may direct the Company to enter into a trust agreement in such form and with such terms as
the Board of Directors of the Company shall then approve (the “Trust Agreement”). If the
Board of Directors of the Company so directs, the Company shall enter into the Trust Agreement and
shall issue to the trust created by such agreement (the “Trust”) all of the Common Shares,
fractional Preferred Shares, or other securities, if any, issuable pursuant to the exchange, and
all Persons entitled to receive such shares or other securities (and any dividends or distributions
made thereon after the date on which such shares or other securities are deposited in the Trust)
shall be entitled to receive such only from the Trust and solely upon compliance with the relevant
terms and provisions of the Trust Agreement.

Section 25. Notice of Certain Events.

(a) In case the Company shall propose, at any time after the Distribution Date, (i) to pay any
dividend payable in stock of any class to the registered holders of Preferred Shares or to make any
other distribution to the registered holders of Preferred Shares (other than a regular periodic
cash dividend out of earnings or retained earnings of the Company), or (ii) to offer to the
registered holders of Preferred Shares rights or warrants to subscribe for or to purchase any
additional Preferred Shares or shares of stock of any class or any other securities, rights, or
options, or (iii) to effect any reclassification of its Preferred Shares (other than a
reclassification involving only the subdivision of outstanding Preferred Shares), or (iv) to effect
any consolidation or merger into or with any other Person, or to effect any sale or other transfer
(or to permit one or more of its Subsidiaries to effect any sale or other transfer), in one
transaction or a series of related transactions, of 50% or more of the assets or earning power of
the Company and its Subsidiaries (taken as a whole and calculated on the basis of the Company’s
most recent regularly prepared financial statements) to any other Person or Persons, or (v) to
effect the liquidation, dissolution, or winding up of the Company, then, in each such case, the
Company shall give to each registered holder of a Rights Certificate, to the extent feasible and in
accordance with Section 26 hereof, a notice of such proposed action, which shall specify the record
date for the purposes of such stock dividend, distribution of rights or warrants, or the date on
which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution, or
winding up is to take place and the date of participation therein by the registered holders of the
Preferred Shares, if any such date is to be fixed, and such notice shall be so given in the case of
any action covered by clause (i) or (ii) above at least 20 days prior to the record date for
determining registered holders of the Preferred Shares for purposes of such action, and in the case
of any such other action, at least 20 days prior to the date of the taking of such proposed action
or the date of participation therein by the registered holders of the Preferred Shares, whichever
shall be the earlier.

(b) In case a Section 11(a)(ii) Event shall occur, then, in any such case, (i) the Company
shall as soon as practicable thereafter give to each registered holder of a
Rights Certificate, to the extent feasible and in accordance with Section 26 hereof, a notice
of the occurrence of such event, which shall specify the event and the consequences of the event to
registered holders of Rights under Section 11(a)(ii) hereof, and (ii) all references in
Section 25(a) to Preferred Shares shall be deemed thereafter to refer to Common Shares or, if
appropriate, other securities.

 

33

 

Section 26. Notices. Notices or demands authorized by this Agreement to be given or
made by the Rights Agent or by the registered holder of any Rights Certificate to or on the Company
shall be sufficiently given or made if sent by (a) first-class mail, postage prepaid, (b) overnight
delivery, or (c) courier or messenger service, in each case addressed (until another address is
filed in writing by the Company with the Rights Agent) as follows:

Spectrum Pharmaceuticals, Inc.

157 Technology Drive

Irvine, California 92618

Attention: Corporate Secretary

Telephone: (949) 788-6700

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

Computershare Trust Company, N.A.

250 Royall Street

Canton, Massachusetts 02021

Attention: Client Services

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

Section 27. Supplements and Amendments. The Company may from time to time and the
Rights Agent shall, if the Company so directs, supplement or amend any provision of this Agreement
without the approval of any registered holders of the Rights to (a) cure any ambiguity, (b) correct
or supplement any provision contained herein that may be defective or inconsistent with any other
provisions herein, (c) shorten or lengthen any time period hereunder, or (d) make any other
provisions with respect to the Rights that the Company may deem necessary or desirable;
provided, however, that, from and after the Distribution Date, no such supplement
or amendment shall adversely affect the interests of
the registered holders of Rights Certificates (other than an Acquiring Person or an Affiliate
or Associate of an Acquiring Person or certain of their transferees). Upon the delivery of a
certificate from an appropriate officer of the Company that states that the proposed supplement or
amendment is in compliance with the terms of this Section 27, an authorized signatory of the Rights
Agent shall execute such supplement or amendment; provided, that any such supplement or
amendment does not adversely affect the rights, duties or obligations of the Rights Agent under
this Agreement. The Rights Agent understands and acknowledges that time is of the essence in
executing such supplement or amendment.

 

34

 

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

Section 29. Determinations and Actions by the Board of Directors. For all purposes of
this Agreement, any calculation of the number of Common Shares or any other class of capital stock
outstanding at any particular time, including for purposes of determining the particular percentage
of such outstanding Common Shares of which any Person is the Beneficial Owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under
the Exchange Act as in effect on the date hereof. The Board of Directors of the Company shall have
the exclusive power and authority to administer this Agreement and to exercise all rights and
powers specifically granted to the Board of Directors of the Company or to the Company, or as may
be necessary or advisable in the administration of this Agreement, including, without limitation,
the right and power to (a) interpret the provisions of this Agreement and (b) make all
determinations deemed necessary or advisable for the administration of this Agreement (including a
determination to redeem or not redeem the Rights or to amend this Agreement). All such actions,
calculations, interpretations, and determinations that are done or made by the Board of Directors
of the Company in good faith, shall be final, conclusive, and binding on the Company, the Rights
Agent, the registered holders of the Rights, and all other parties.

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

Section 31. Severability. If any term, provision, covenant, or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be invalid, void, or
unenforceable, the remainder of the terms, provisions, covenants, and restrictions of this
Agreement shall remain in full force and effect and shall in no way be affected, impaired, or
invalidated; provided, however, that notwithstanding anything in this Agreement to
the contrary, if any such term, provision, covenant, or restriction is held by such court or
authority to be invalid, void, or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the invalid language from
this Agreement would adversely affect the purpose or effect of this Agreement, the right of
redemption set forth in Section 23 hereof shall be reinstated and shall not expire until the Close
of Business on the 10th day following the date of such determination by the Board of Directors of
the Company.

 

35

 

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

Section 33. Counterparts; Facsimiles and PDFs. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the same instrument. A
facsimile or .pdf signature delivered electronically shall constitute an original signature for all
purposes.

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

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

[The remainder of this page is intentionally left blank.]

 

36

 

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

	 	 	 	 	 
	 	SPECTRUM PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/ Shyam Kumaria
 	 
	 	 	Name:  	Shyam Kumaria 	 
	 	 	Title:  	Senior Vice President, Finance 	 
	 
	 	COMPUTERSHARE TRUST COMPANY, N.A.

 	 
	 	By:  	/s/ Kellie Gwinn
 	 
	 	 	Name:  	Kellie Gwinn 	 
	 	 	Title:  	Vice President 	 
	 

 

 

 

EXHIBIT A

FORM OF

CERTIFICATE OF DESIGNATION, PREFERENCES, AND

RIGHTS OF SERIES B JUNIOR PARTICIPATING PREFERRED STOCK

of

SPECTRUM PHARMACEUTICALS, INC.

Pursuant to Section 151 of the General Corporation Law of the State of Delaware

Spectrum Pharmaceuticals, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the “Corporation”), in accordance with the
provisions of Section 103 thereof, DOES HEREBY CERTIFY:

That pursuant to the authority conferred upon the Board of Directors by the Amended
Certificate of Incorporation of the Corporation, the said Board of Directors on November 29, 2010,
adopted the following resolution creating a series of Preferred Stock designated as Series B Junior
Participating Preferred Stock (as hereinafter defined):

RESOLVED, that pursuant to the authority vested in the Board of Directors of the Corporation
in accordance with the provisions of its Certificate of Incorporation, a series of Preferred Stock
of the Corporation be and it hereby is created, and that the designation and amount thereof and the
voting powers, preferences and relative, participating, optional and other special rights of the
shares of such series, and the qualifications, limitations, and restrictions thereof are as
follows:

Section 1. Designation and Amount. The shares of such series shall be designated as
“Series B Junior Participating Preferred Stock” and the number of shares constituting such series
shall be 1,500,000.

Section 2. Dividends and Distributions.

(a) Subject to the prior and superior rights of the holders of any shares of any series of
Preferred Stock ranking prior and superior to the shares of Series B Junior Participating Preferred
Stock with respect to dividends, the holders of shares of Series B Junior Participating Preferred
Stock, in preference to the holders of shares of Common Stock, par value $0.001 per share, of the
Corporation (the “Common Stock”), and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the last day of March, June, September, and
December in each year (each such date being referred to herein as a “Quarterly Dividend Payment
Date”), commencing on the first Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series B Junior Participating Preferred Stock, in an amount per
share (rounded to the nearest cent) equal to the greater of (i) $1.00 or (ii) subject to the
provision for adjustment hereinafter set forth, 1000 times the aggregate per share amount of all
cash dividends, and 1000 times the

 

A-1

 

aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision
of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock since the immediately preceding Quarterly Dividend Payment Date, or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series B Junior Participating Preferred Stock. In the event the Corporation shall at any
time after November 29, 2010 (the “Rights Dividend Declaration Date”) (A) declare any
dividend on Common Stock payable in shares of Common Stock, (B) subdivide the outstanding Common
Stock, or (C) combine the outstanding Common Stock into a smaller number of shares, then in each
such case the amount to which holders of shares of Series B Junior Participating Preferred Stock
were entitled immediately prior to such event under clause (ii) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.

(b) The Corporation shall declare a dividend or distribution on the Series B Junior
Participating Preferred Stock as provided in Section 2(a) above immediately after it declares a
dividend or distribution on the Common Stock (other than a dividend payable in shares of Common
Stock); provided, that, in the event no dividend or distribution shall have been declared
on the Common Stock during the period between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per share on the Series B Junior
Participating Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.

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

 

A-2

 

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

(a) Subject to the provision for adjustment hereinafter set forth, each share of Series B
Junior Participating Preferred Stock shall entitle the holder thereof to 1000 votes on all matters
submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at
any time after the Rights Dividend Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of shares, then in each such case the number of
votes per share to which holders of shares of Series B Junior Participating Preferred Stock were
entitled immediately prior to such event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.

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

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

(ii) During any default period, such voting right of the holders of Series B Junior
Participating Preferred Stock may be exercised initially at a special meeting called pursuant to
Section 3(c)(iii) or at any annual meeting of stockholders, and thereafter at annual meetings of
stockholders, provided, that such voting right shall not be exercised unless the holders of
10% in number of shares of Preferred Stock outstanding shall be present in person or by proxy. The
absence of a quorum of the holders of Common Stock shall not affect the exercise by the holders of
Preferred Stock of such voting right. At any meeting at which the holders of Preferred Stock shall
exercise such voting right initially during an existing default period, they shall have the right,
voting as a class, to elect directors to fill such vacancies, if any, in the Board of Directors as
may then exist up to two directors or, if such right is exercised at an annual meeting, to elect
two directors. If the number that may be so elected at any special meeting does not amount to the
required number, the holders of Preferred Stock shall have the right to make such increase in the
number of directors as shall be necessary to permit the election by them of the required number.
After the holders of Preferred Stock shall have exercised their right to elect directors in any
default period and during the continuance of such period, the number of directors shall not be
increased or decreased except by vote of the holders of
Preferred Stock as herein provided or pursuant to the rights of any equity securities ranking
senior to or pari passu with the Series B Junior Participating Preferred Stock.

 

A-3

 

(iii) Unless the holders of Preferred Stock shall, during an existing default period, have
previously exercised their right to elect directors, the Board of Directors may order, or any
stockholder or stockholders owning in the aggregate not less than 10% of the total number of shares
of Preferred Stock outstanding, irrespective of series, may request, the calling of a special
meeting of the holders of Preferred Stock, which meeting shall thereupon be called by the
President, a Vice President, or the Secretary of the Corporation. Notice of such meeting and of
any annual meeting at which holders of Preferred Stock are entitled to vote pursuant to this
Section 3(c)(iii) shall be given to each holder of record of Preferred Stock by mailing a copy of
such notice to such holder at such holder’s last address as the same appears on the books of the
Corporation. Such meeting shall be called for a time not earlier than 20 days and not later than
60 days after such order or request or in default of the calling of such meeting within 60 days
after such order or request, such meeting may be called on similar notice by any stockholder or
stockholders owning in the aggregate not less than 10% of the total number of shares of Preferred
Stock outstanding. Notwithstanding the provisions of this Section 3(c)(iii), no such special
meeting shall be called during the period within 60 days immediately preceding the date fixed for
the next annual meeting of the stockholders.

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

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

 

A-4

 

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

Section 4. Certain Restrictions.

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

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

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

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

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

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

Section 5. Reacquired Shares. Any shares of Series B Junior Participating Preferred
Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired
and cancelled promptly after the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors, subject to the conditions and restrictions on
issuance set forth herein, in the Certificate of Incorporation, or in any other Certificate of
Designation creating a series of Preferred Stock or any similar stock, or as otherwise required by
law.

 

A-5

 

Section 6. Liquidation, Dissolution, or Winding Up.

(a) Upon any liquidation (voluntary or otherwise), dissolution, or winding up of the
Corporation, no distribution shall be made to the holders of shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution, or winding up) to the Series B Junior
Participating Preferred Stock unless, prior thereto, the holders of shares of Series B Junior
Participating Preferred Stock shall have received an amount equal to $1000 per share of Series B
Participating Preferred Stock, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment (the “Series B
Liquidation Preference”). Following the payment of the full amount of the Series B Liquidation
Preference, no additional distributions shall be made to the holders of shares of Series B Junior
Participating Preferred Stock unless, prior thereto, the holders of shares of Common Stock shall
have received an amount per share (the “Common Adjustment”) equal to the quotient obtained
by dividing (i) the Series B Liquidation Preference by (ii) 1000 (as appropriately adjusted as set
forth in Section 4(c) below to reflect such events as stock splits, stock dividends, and
recapitalizations with respect to the Common Stock) (such number in clause (ii), the
“Adjustment Number”). Following the payment of the full amount of the Series B Liquidation
Preference and the Common Adjustment in respect of all outstanding shares of Series B Junior
Participating Preferred Stock and Common Stock, respectively, holders of Series B Junior
Participating Preferred Stock and holders of shares of Common Stock shall receive their ratable and
proportionate share of the remaining assets to be distributed in the ratio of the Adjustment Number
to one with respect to such Preferred Stock and Common Stock, on a per share basis, respectively.

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

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

 

A-6

 

Section 7. Consolidation, Merger, etc. In case the Corporation shall enter into any
consolidation, merger, combination, or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash, or any other property, then in any
such case the shares of Series B Junior Participating Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 1000 times the aggregate amount of stock, securities, cash, or any
other property (payable in kind), as the case may be, into which or for which each share of Common
Stock is changed or exchanged. In the event the Corporation shall at any time after the Rights
Dividend Declaration Date (i) declare any dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series B Junior Participating
Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which
is the number of shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were outstanding immediately
prior to such event.

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

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

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

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

[The remainder of this page is intentionally left blank.]

 

A-7

 

IN WITNESS WHEREOF, Spectrum Pharmaceuticals, Inc. has caused this Certificate of Designation
to be signed by the undersigned this
 _____ 

day of December, 2010.

	 	 	 	 	 
	 	SPECTRUM PHARMACEUTICALS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

A-8

 

EXHIBIT B

FORM OF RIGHTS CERTIFICATE

			
	 	 	 
	Certificate No. R-
	 	                     Rights

NOT EXERCISABLE AFTER DECEMBER 13, 2020 OR EARLIER IF REDEEMED OR EXCHANGED BY THE
COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$0.001 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY
PERSON WHO IS, WAS, OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE
THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY
BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT BENEFICIAL
OWNER, MAY BECOME NULL AND VOID.

Rights Certificate

SPECTRUM PHARMACEUTICALS, INC.

This certifies that                                         , or registered assigns, is the registered owner
of the number of Rights set forth above, each of which entitles the owner thereof, subject to the
terms, provisions, and conditions of the Rights Agreement, dated as of December 13, 2010 (the
“Rights Agreement”), between Spectrum Pharmaceuticals, Inc., a Delaware corporation (the
“Company”), and Computershare Trust Company, N.A., a national banking association (the
“Rights Agent”), to purchase from the Company at any time prior to 5:00 p.m., Canton,
Massachusetts, time, on December 13, 2020, at the office or offices of the Rights Agent designated
for such purpose, or its successors as Rights Agent, one one-thousandth of a fully paid,
non-assessable share of Series B Junior Participating Preferred Stock of the Company (a
“Preferred Share”), at a purchase price of $50.00 per one one-thousandth of a share (such
purchase price, as may be adjusted, the “Purchase Price”), upon presentation and surrender
of this Rights Certificate with the Form of Election to Purchase and related Certificate duly
executed. The number of Rights evidenced by this Rights Certificate (and the number of shares that
may be purchased upon exercise thereof) set forth above, and the Purchase Price per share set forth
above, are the number and Purchase Price as of December 13, 2010, based on the Preferred Shares as
constituted at such date. The Company reserves the right to require prior to the occurrence of a
Triggering Event (as such term is defined in the Rights Agreement) that a number of Rights be
exercised so that only whole Preferred Shares will be issued.

Upon the occurrence of a Section 11(a)(ii) Event (as such term is defined in the Rights
Agreement), if the Rights evidenced by this Rights Certificate are beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of an Acquiring Person (as
such terms are defined in the Rights Agreement), (ii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate), or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of a person who, after such transfer, became an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, such Rights shall become null and void and no holder
hereof shall have any right with respect to such Rights from and after the occurrence of such
Section 11(a)(ii) Event.

 

B-1

 

As provided in the Rights Agreement, the Purchase Price, the number and kind of Preferred
Shares or other securities issuable upon exercise of a Right, and the number of Rights outstanding
are subject to modification and adjustment upon the happening of certain events, including
Triggering Events.

This Rights Certificate is subject to all of the terms, provisions, and conditions of the
Rights Agreement, which terms, provisions, and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is hereby made for a full
description of the rights, limitations of rights, obligations, duties, and immunities hereunder of
the Rights Agent, the Company, and the holders of the Rights Certificates, which limitations of
rights include the temporary suspension of the exercisability of such Rights under the specific
circumstances set forth in the Rights Agreement. Copies of the Rights Agreement are on file at the
above-mentioned office of the Rights Agent and are also available upon written request to the
Rights Agent.

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

Subject to the provisions of the Rights Agreement, the Rights evidenced by this Rights
Certificate may be redeemed by the Company at its option at a redemption price of $0.001 per Right
at any time prior to the earlier of (i) the Close of Business on the 10th day following the Shares
Acquisition Date, and (ii) the Final Expiration Date (as such terms are defined in the Rights
Agreement). In addition, under certain circumstances following the occurrence of a
Section 11(a)(ii) Event but before any person acquires beneficial ownership of 50% or more of the
Common Shares (as such term is defined in the Rights Agreement), the Rights may be exchanged, in
whole or in part, for Common Shares, Preferred Shares, or shares of other preferred stock of the
Company having essentially the same value or economic rights as such shares. Immediately upon the
action of the Board of Directors of the Company authorizing any such redemption or exchange, and
without any further action or any notice, the Rights (other than Rights that are not subject to
such redemption or exchange) will terminate and the Rights will only enable holders to receive the
redemption price or the shares issuable upon such exchange, as applicable.

 

B-2

 

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

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

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

 

B-3

 

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

Dated as of                     
_____, 20___.

	 	 	 	 	 
	 	SPECTRUM PHARMACEUTICALS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Countersigned:

Computershare Trust Company, N.A.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 
	 

	 	Authorized Signature	 	 

 

B-4

 

[Form of Reverse Side of Rights Certificate]

FORM OF ASSIGNMENT

(To be executed by the registered holder if such

holder desires to transfer the Rights Certificate.)

FOR VALUE RECEIVED                                          hereby sells, assigns and transfers unto
                                                           

 

 

(Please print name and address of transferee)

 

 

(Please spell out and include in numerals the

number of Rights being transferred by this Assignment)

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

Dated:                     , ______

	 	 	 	 	 
	 	
 	 
	 	Signature 	 

Medallion Signature Guaranteed:

 

B-5

 

Certificate

The undersigned hereby certifies by checking the appropriate boxes that:

(1) the Rights evidenced by this Rights Certificate [__] are not being sold, assigned, and
transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights
Agreement); and

(2) after due inquiry and to the best knowledge of the undersigned, he, she, or it
[__] did [__] did not acquire the Rights evidenced by this Rights Certificate from any Person who
is, was, or subsequently became an Acquiring Person or an Affiliate or Associate of an Acquiring
Person.

	 	 	 	 	 
	Dated:                     ,
 _____ 

	 	 	 	 
	 

	 	 	 	 
	 

	 	 	 	Signature

Medallion Signature Guaranteed:

NOTICE

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

 

B-6

 

[Form of Reverse Side of Rights Certificate—continued]

FORM OF ELECTION TO PURCHASE

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

exercise any or all Rights evidenced by the Rights Certificate.)

To: Spectrum Pharmaceuticals, Inc.:

The undersigned hereby irrevocably elects to exercise                                          (                 
   )
Rights evidenced by this Rights Certificate to purchase the Preferred Shares issuable upon the
exercise of the Rights (or such other securities of the Company or of any other person that may be
issuable upon the exercise of the Rights) and requests that certificates for such shares be issued
in the name of and delivered to or that such shares be credited to the book-entry account of:

 

(Please print social security or other identifying number)

 

 

(Please print name and address)

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

 

(Please print social security or other identifying number)

 

 

(Please print name and address)

Dated:                     , ______

	 	 	 	 	 
	 	 	 
	 	Signature 	 

Medallion Signature Guaranteed:

 

B-7

 

Certificate

The undersigned hereby certifies by checking the appropriate boxes that:

(1) the Rights evidenced by this Rights Certificate [__] are not being exercised by or on
behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such
Acquiring Person (as such terms are defined pursuant to the Rights Agreement); and

(2) after due inquiry and to the best knowledge of the undersigned, he, she, or it
[__] did [__] did not acquire the Rights evidenced by this Rights Certificate from any Person who
is, was or became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

	 	 	 	 	 
	Dated:                     ,
 _____ 

	 	 	 	 
	 

	 	 	 	 
	 

	 	 	 	Signature

Medallion Signature Guaranteed:

NOTICE

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

 

B-8

 

EXHIBIT C

UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY
OWNED BY ANY PERSON WHO IS, WAS, OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE
OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER
CURRENTLY BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT
BENEFICIAL OWNER, MAY BECOME NULL AND VOID.

FORM OF SUMMARY OF RIGHTS

TO PURCHASE PREFERRED STOCK

On November 29, 2010 the Board of Directors of Spectrum Pharmaceuticals, Inc., a Delaware
corporation (the “Company”), declared a dividend distribution of one right (each, a
“Right”) for each outstanding share of common stock, par value $0.001, of the Company (the
“Common Shares”). The dividend is payable to holders of record as of the close of business
on December 13, 2010 (the “Record Date”).

The following is a summary description of the Rights. This summary is intended to provide a
general description only and is subject to the detailed terms and conditions of the Rights
Agreement (the “Rights Agreement”), dated as of December 13, 2010, by and between the
Company and Computershare Trust Company, N.A., as rights agent (the “Rights Agent”).

1. Issuance of Rights

Each holder of Common Shares as of the Record Date will receive a dividend of one Right per
Common Share. One Right will also be issued together with each Common Share issued by the Company
after the Record Date and prior to the Distribution Date (as defined in Section 2 below), and in
certain circumstances, after the Distribution Date. New certificates (or, if uncertificated,
ownership statements in lieu thereof) for Common Shares issued after the Record Date will contain a
notation incorporating the Rights Agreement by reference.

Until the Distribution Date:

	 	•	 	the Rights will not be exercisable;

	 	•	 	the Rights will be evidenced by the certificates for Common Shares (or by the
ownership statements issued with respect to uncertificated Common Shares) and not by
separate rights certificates; and

	 	•	 	the Rights will be transferable by, and only in connection with, the transfer of
Common Shares.

 

C-1

 

2. Distribution Date; Beneficial Ownership

The Rights are not exercisable until the Distribution Date. As of and after the Distribution
Date, the Rights will separate from the Common Shares and each Right will become exercisable to
purchase one one-thousandth of a share of Series B Junior Participating Preferred Stock, par value
$0.001 per share, of the Company (each whole share, a “Preferred Share”) at a purchase
price of $50.00 (such purchase price, as may be adjusted, the “Purchase Price”). This
portion of a Preferred Share would give the holder thereof approximately the same dividend, voting,
and liquidation rights as would one Common Share.

The “Distribution Date” is the earlier of:

	 	•	 	ten days following a public announcement that a person has become an “Acquiring
Person” by acquiring beneficial ownership of 15% or more of the outstanding Common
Shares then outstanding other than as a result of repurchases of Common Shares by the
Company or certain inadvertent acquisitions; and

	 	•	 	ten business days (or such later date as the Board of Directors of the Company
shall determine prior to the time a person becomes an Acquiring Person) after the
commencement of a tender offer or exchange offer by or on behalf of any person (other
than the Company or certain related entities) that, if completed, would result in such
person becoming an Acquiring Person.

A person will be deemed to “beneficially own” any Common Shares if such person or any
affiliated or associated person of such person:

	 	•	 	is considered a “beneficial owner” of the Common Shares under Rule 13d-3 of the
General Rules and Regulations under the Securities Exchange Act of 1934, as amended
and as in effect on the date of the Rights Agreement;

	 	•	 	has the right to acquire the Common Shares, either immediately or in the future,
pursuant to any agreement, arrangement, or understanding (other than a customary
underwriting agreement relating to a bona fide public offering of the Common Shares)
or upon the exercise of conversion rights, exchange rights, rights, warrants or
options, or otherwise, except that a person will not be deemed to be a beneficial
owner of (a) Common Shares tendered pursuant to a tender offer or exchange offer by or
on behalf of such person or any affiliated or associated persons of such person until
the tendered Common Shares are accepted for purchase or exchange, (b) securities
issuable upon exercise of a Right before the occurrence of a Triggering Event (as
defined in Section 5 below), or (c) securities issuable upon exercise of a Right after
the occurrence of a Triggering Event if the Rights are originally issued Rights or
were issued in connection with an adjustment to originally issued Rights;

 

C-2

 

	 	•	 	has the right to vote or dispose of the Common Shares pursuant to any agreement,
arrangement, or understanding (other than a right to vote arising from the granting of
a revocable proxy or consent that is not also then reportable on a Schedule 13D); or

	 	•	 	has an agreement, arrangement, or understanding with another person who
beneficially owns Common Shares and the agreement, arrangement, or understanding is
for the purpose of acquiring, holding, voting, or disposing of any securities of the
Company (other than customary underwriting agreements relating to a bona fide public
offering of Common Shares or a right to vote arising from the granting of a revocable
proxy or consent that is not also then reportable on a Schedule 13D).

3. Issuance of Rights Certificates

As soon as practicable after the Distribution Date, the Rights Agent will mail rights
certificates to holders of record of the Common Shares as of the close of business on the
Distribution Date and, thereafter, the separate rights certificates alone will evidence the Rights.

4. Expiration of Rights

The Rights will expire on the earliest of (a) 5:00 p.m., Canton, Massachusetts, time, on
December 13, 2020, (b) the time at which the Rights are redeemed (as described in Section 6 below),
and (c) the time at which the Rights are exchanged in full (as described in Section 7 below).

5. Change of Exercise of Rights Following Certain Events

The following described events are referred to as “Triggering Events.”

(a) Flip-In Event. In the event that a person becomes an Acquiring Person, each
holder of a Right will thereafter have the right to receive, upon exercise, Common Shares (or, in
certain circumstances, other securities, cash, or other assets of the Company) having a value equal
to two times the Purchase Price. Notwithstanding any of the foregoing, following the occurrence of
a person becoming an Acquiring Person, all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned by any Acquiring Person (or by certain
related parties) will be null and void. However, Rights are not exercisable following the
occurrence of a person becoming an Acquiring Person until such time as the Rights are no longer
redeemable by the Company as set forth below.

For example, at a purchase price of $50.00 per Right, following the occurrence of a person
becoming an Acquiring Person, each Right not owned by the Acquiring Person (or by certain related
parties) would entitle its holder to purchase $100.00 worth of Common Shares (or other
consideration, as noted above) for $50.00. Assuming that the Common Shares have a per share value
of $5.00 at such time, the holder of each valid Right would be entitled to purchase 20 Common
Shares for $50.00.

 

C-3

 

(b) Flip-Over Events. In the event that, at any time after a person has become an
Acquiring Person, (i) the Company engages in a merger or other business combination transaction in
which the Company is not the continuing or surviving corporation or other entity, (ii) the Company
engages in a merger or other business combination transaction in which the Company is the
continuing or surviving corporation and the Common Shares of the Company are changed or exchanged,
or (iii) 50% or more of the Company’s assets or earning power is sold or transferred, each holder
of a Right (except Rights that have previously been voided as set forth above) shall thereafter
have the right to receive, upon exercise, common shares of the acquiring company having a value
equal to two times the Purchase Price.

6. Redemption

At any time until 10 days following the Shares Acquisition Date (as defined in the Rights
Agreement), the Board of Directors of the Company may direct the Company to redeem the Rights in
whole, but not in part, at a price of $0.001 per Right (payable in cash, Common Shares, or other
consideration deemed appropriate by the Board of Directors of the Company). Immediately upon the
action of the Board of Directors of the Company directing the Company to redeem the Rights, the
Rights will terminate and the only right of the holders of Rights will be to receive the $0.001
redemption price.

7. Exchange of Rights

At any time after a person becomes an Acquiring Person but before any person acquires
beneficial ownership of 50% or more of the outstanding Common Shares, the Board of Directors of the
Company may direct the Company to exchange the Rights (other than Rights owned by such person or
certain related parties, which will have become void), in whole or in part, at an exchange ratio of
one Common Share per Right (subject to adjustment). The Company may substitute Preferred Shares
(or shares of a class or series of the Company’s preferred stock having equivalent rights,
preferences, and privileges) for Common Shares at an initial rate of one one-thousandth of a
Preferred Share (or of a share of a class or series of the Company’s preferred stock having
equivalent rights, preferences, and privileges) per Common Share. Immediately upon the action of
the Board of Directors of the Company directing the Company to exchange the Rights, the Rights will
terminate and the only right of the holders of Rights will be to receive the number of Common
Shares (or one one-thousandth of a Preferred Share or of a share of a class or series of the
Company’s preferred stock having equivalent rights, preferences, and privileges) equal to the
number of Rights held by such holder multiplied by the exchange ratio.

8. Adjustments to Prevent Dilution; Fractional Shares

The Board of Directors of the Company may adjust the Purchase Price, the number of Preferred
Shares or other securities or assets issuable upon exercise of a Right, and the number of Rights
outstanding to prevent dilution that may occur (a) in the event of a stock dividend on, or a
subdivision, combination, or reclassification of, the Preferred Shares, (b) in the event of a stock
dividend on, or a subdivision or combination of, the Common Shares, (c) if holders of the Preferred
Shares are granted certain rights, options, or warrants
to subscribe for Preferred Shares or convertible securities at less than the current market
price of the Preferred Shares, or (d) upon the distribution to holders of the Preferred Shares of
evidences of indebtedness or assets (excluding regular periodic cash dividends) or of subscription
rights or warrants (other than those referred to above).

 

C-4

 

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

9. No Stockholder Rights Prior to Exercise; Tax Considerations

Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder
of the Company, including, without limitation, the right to vote or to receive dividends. While
the distribution of the Rights will not be taxable to stockholders or to the Company, stockholders
may, depending upon the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Shares (or other consideration) of the Company or for common shares of the
acquiring company or in the event of the redemption of the Rights as set forth in Section 6 above.

10. Amendment of Rights Agreement

The Company may supplement or amend any provision of the Rights Agreement in order to (a) cure
any ambiguity, (b) correct or supplement any provision contained in the Rights Agreement that may
be defective or inconsistent with other provisions of the Rights Agreement, (c) shorten or lengthen
any time period under the Rights Agreement, or (d) make any other provisions with respect to the
Rights that the Company deems necessary or desirable; provided, however, that no
supplement or amendment made after the Distribution Date may adversely affect the interests of the
registered holders of rights certificates (other than an Acquiring Person or any affiliated or
associated person of an Acquiring Person or certain of their transferees).

The Company has filed a copy of the Rights Agreement with the Securities and Exchange
Commission as an exhibit to a Form 8-K filed on December 13, 2010. In addition, 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.

 

C-5

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