Document:

exv4w1

Exhibit 4.1

AMENDED AND RESTATED

SHAREHOLDER RIGHTS PLAN

by and between

RealNetworks, Inc.

and

Mellon Investor Services LLC

Dated as of December 2, 2008

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	Section 1.
	 	Certain Definitions	 	 	2	 
	 
	 	 	 	 	 	 
	Section 2.
	 	Appointment of Rights Agent	 	 	7	 
	 
	 	 	 	 	 	 
	Section 3.
	 	Issuance of Rights Certificates	 	 	7	 
	 
	 	 	 	 	 	 
	Section 4.
	 	Form of Rights Certificates	 	 	9	 
	 
	 	 	 	 	 	 
	Section 5.
	 	Countersignature and Registration	 	 	10	 
	 
	 	 	 	 	 	 
	Section 6.
	 	Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates	 	 	10	 
	 
	 	 	 	 	 	 
	Section 7.
	 	Exercise of Rights; Exercise Price; Expiration Date of Rights	 	 	11	 
	 
	 	 	 	 	 	 
	Section 8.
	 	Cancellation and Destruction of Rights Certificates	 	 	13	 
	 
	 	 	 	 	 	 
	Section 9.
	 	Reservation and Availability of Preferred Shares	 	 	13	 
	 
	 	 	 	 	 	 
	Section 10.
	 	Record Date	 	 	15	 
	 
	 	 	 	 	 	 
	Section 11.
	 	Adjustment of Exercise Price, Number of Shares or Number of Rights	 	 	15	 
	 
	 	 	 	 	 	 
	Section 12.
	 	Certificate of Adjusted Exercise 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	 	 	25	 
	 
	 	 	 	 	 	 
	Section 15.
	 	Rights of Action	 	 	26	 
	 
	 	 	 	 	 	 
	Section 16.
	 	Agreement of Rights Holders	 	 	27	 
	 
	 	 	 	 	 	 
	Section 17.
	 	Rights Certificate Holder Not Deemed a Shareholder	 	 	27	 
	 
	 	 	 	 	 	 
	Section 18.
	 	Concerning the Rights Agent	 	 	27	 
	 
	 	 	 	 	 	 
	Section 19.
	 	Merger or Consolidation or Change of Name of Rights Agent	 	 	28	 
	 
	 	 	 	 	 	 
	Section 20.
	 	Rights and Duties of Rights Agent	 	 	29	 
	 
	 	 	 	 	 	 
	Section 21.
	 	Change of Rights Agent	 	 	31	 
	 
	 	 	 	 	 	 

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	 	 	 	 	Page	 
	Section 22.
	 	Issuance of New Rights Certificates	 	 	32	 
	 
	 	 	 	 	 	 
	Section 23.
	 	Redemption	 	 	32	 
	 
	 	 	 	 	 	 
	Section 24.
	 	Exchange	 	 	33	 
	 
	 	 	 	 	 	 
	Section 25.
	 	Notice of Certain Events	 	 	35	 
	 
	 	 	 	 	 	 
	Section 26.
	 	Notices	 	 	35	 
	 
	 	 	 	 	 	 
	Section 27.
	 	Supplements and Amendments	 	 	36	 
	 
	 	 	 	 	 	 
	Section 28.
	 	Successors	 	 	36	 
	 
	 	 	 	 	 	 
	Section 29.
	 	Determinations and Actions by the Board, etc	 	 	36	 
	 
	 	 	 	 	 	 
	Section 30.
	 	Benefits of this Agreement	 	 	37	 
	 
	 	 	 	 	 	 
	Section 31.
	 	Severability	 	 	37	 
	 
	 	 	 	 	 	 
	Section 32.
	 	Governing Law	 	 	37	 
	 
	 	 	 	 	 	 
	Section 33.
	 	Counterparts	 	 	37	 
	 
	 	 	 	 	 	 
	Section 34.
	 	Descriptive Headings	 	 	38	 

EXHIBITS

	 	 	 
	Exhibit A
	 	Form of Certificate of Designation
	 
	 	 
	Exhibit B
	 	Form of Rights Certificate
	 
	 	 
	Exhibit C
	 	Summary of Rights

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AMENDED AND RESTATED

SHAREHOLDER RIGHTS PLAN

     THIS AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN (the “Agreement”) is made and entered into
as of December 2, 2008 by and between RealNetworks, Inc., a Washington corporation and Mellon
Investor Services LLC, a New Jersey limited liability company and amends and restates the prior
Shareholder Rights Plan, dated December 4, 1998 between RealNetworks, Inc., and ChaseMellon
Shareholder Services, L.L.C. (such prior Shareholder Rights Plan, as previously amended, the
“Original Agreement”).

     WHEREAS, on December 4, 1998, the Company and ChaseMellon Shareholder Services, L.L.C. entered
into the Original Agreement;

     WHEREAS, in connection with the Original Agreement, the Board of Directors of the Company (the
“Board”) authorized and declared a dividend of one Preferred Share Purchase Right (a “Right”) for
each Common Share (as hereinafter defined) of the Company outstanding as of the Close of Business
(as hereinafter defined) on December 14, 1998 (the “Record Date”), each Right representing the
right to purchase one one-thousandth (0.001) of a share of Series A Preferred Stock (as such number
may be adjusted pursuant to the provisions of this Agreement), having the rights, preferences and
privileges set forth in the form of Certificate of Designation of Rights, Preferences and
Privileges of Series A Preferred Stock attached hereto as Exhibit A, upon the terms and
subject to the conditions set forth in the Original Agreement; and further authorized and directed
the issuance of one Right with respect to each Common Share that became outstanding between the
Record Date and the earliest of the Distribution Date, and the Redemption Date or the Final
Expiration Date (as such terms are hereinafter defined), subject to the terms of the Original
Agreement;

     WHEREAS, the Original Agreement expires by its terms on December 4, 2008 (the “Original Final
Expiration Date”);

     WHEREAS, after thorough and careful consideration, the consultation with its advisors and such
other inquiries as the Board has deemed appropriate, the Board has determined that it is in the
best interests of the Company and its shareholders to amend and restate the Original Agreement to
extend the Original Final Expiration Date to the Final Expiration Date set forth herein so as to
continue the benefits of the Original Agreement beyond the Original Final Expiration Date, to
adjust the Exercise Price for the Rights and to make such other changes to the Original Agreement
as the Board otherwise deems advisable;

     WHEREAS, the Board has determined that, pursuant to the terms of the Original Agreement, the
Original Agreement may be amended and restated as set forth herein without the approval of the
holders of the Rights; and

     WHEREAS, the Company and the Rights Agent desire to amend and restate the Original Agreement
in its entirety to give effect the foregoing changes to the terms and provisions of the Original
Agreement, all as set forth in this Agreement.

 

     NOW, THEREFORE, in consideration of the promises and the mutual agreements herein set forth,
the parties hereby agree that the Original Agreement is hereby amended and restated in its entirety
as follows:

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

          (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 fifteen percent (15%) or more of the
Common Shares then outstanding, but shall not include the Company, any Subsidiary of the Company,
the Grandfathered Shareholder or any employee benefit plan of the Company or of any Subsidiary of
the Company, or any entity holding Common Shares for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person shall be deemed to be an Acquiring Person as the result of
an acquisition of Common Shares by the Company which, by reducing the number of shares outstanding,
increases the proportionate number of shares beneficially owned by such Person to fifteen percent
(15%) or more of the Common Shares of the Company then outstanding; provided,
however, that if a Person shall become the Beneficial Owner of fifteen percent (15%) or
more of the Common Shares of the Company then outstanding by reason of share purchases by the
Company and shall, after such share purchases by the Company, become the Beneficial Owner of any
additional Common Shares of the Company (other than pursuant to a dividend or distribution paid or
made by the Company on the outstanding Common Shares in Common Shares or pursuant to a split or
subdivision of the outstanding Common Shares), then such Person shall be deemed to be an Acquiring
Person unless upon becoming the Beneficial Owner of such additional Common Shares of the Company
such Person does not beneficially own fifteen percent (15%) or more of the Common Shares of the
Company then outstanding. Notwithstanding the foregoing, if the Board determines in good faith
that a Person who would otherwise be an “Acquiring Person,” as defined pursuant to the foregoing
provisions of this Section 1(a), has become such inadvertently (including, without
limitation, because (A) such Person was unaware that it beneficially owned a percentage of the
Common Shares that would otherwise cause such Person to be an “Acquiring Person,” as defined
pursuant to the foregoing provisions of this Section 1(a), or (B) such Person was aware of
the extent of the Common Shares it beneficially owned but had no actual knowledge of the
consequences of such beneficial ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and if such Person divested or divests as promptly
as practicable a sufficient number of Common Shares so that such Person would no longer be an
“Acquiring Person,” as defined pursuant to the foregoing provisions of this Section 1(a),
then such Person shall not be deemed to be or to have become an “Acquiring Person” for any purposes
of this Agreement including, without limitation Section 1(a) hereof.

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

          (c) “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.

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          (d) A Person shall be deemed the “Beneficial Owner” of and shall be deemed to “beneficially
own,” or have “beneficial ownership” of, any securities:

               (i) which such Person or any of such Person’s Affiliates or Associates beneficially owns,
directly or indirectly, for purposes of Section 13(d) of the Exchange Act and Rule 13d-3 thereunder
(or any comparable or successor law or regulation);

               (ii) which such Person or any of such Person’s Affiliates or Associates has (A) the right to
acquire (whether such right is exercisable immediately or only after the passage of time) pursuant
to any agreement, arrangement or understanding (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide public offering of securities),
or upon the exercise of conversion rights, exchange rights, rights (other than the Rights),
warrants or options, or otherwise; provided, however, that a Person shall not be
deemed pursuant to this Section 1(d)(ii)(A) to be the Beneficial Owner of, or to
beneficially own, (1) securities tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person’s Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, or (2) securities which a Person or any of such
Person’s Affiliates or Associates may be deemed to have the right to acquire pursuant to any merger
or other acquisition agreement between the Company and such Person (or one or more of its
Affiliates or Associates) if such agreement has been approved by the Board prior to there being an
Acquiring Person; or (B) the right to vote pursuant to any agreement, arrangement or understanding;
provided, however, that a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security under this Section 1(d)(ii)(B) if the agreement, arrangement
or understanding to vote such security (1) arises solely from a revocable proxy or consent given to
such Person in response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the Exchange Act and (2) is not also then
reportable on Schedule 13D under the Exchange Act (or any comparable or successor report); or

               (iii) which are beneficially owned, directly or indirectly, by any other Person (or any
Affiliate or Associate thereof) with which such Person or any of such Person’s Affiliates or
Associates has any agreement, arrangement or understanding, whether or not in writing (other than
customary agreements with and between underwriters and selling group members with respect to a bona
fide public offering of securities) for the purpose of acquiring, holding, voting (except to the
extent contemplated by the proviso to Section 1(d)(ii)(B)) or disposing of any securities
of the Company; provided, however, that in no case shall an officer or director of
the Company be deemed (x) the Beneficial Owner of any securities beneficially owned by another
officer or director of the Company solely by reason of actions undertaken by such Persons in their
capacity as officers or directors of the Company or (y) the Beneficial Owner of securities held of
record by the trustee of any employee benefit plan of the Company or any Subsidiary of the Company
for the benefit of any employee of the Company or any Subsidiary of the Company, other than the
officer or director, by reason of any influence that such officer or director may have over the
voting of the securities held in the plan.

          (e) “Board” shall have the meaning set forth in the recitals at the beginning of this
Agreement.

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          (f) “Business Day” shall mean any day other than a Saturday, Sunday or a day on which banking
institutions in Washington, New York or New Jersey are authorized or obligated by law or executive
order to close.

          (g) “Close of Business” on any given date shall mean 5:00 P.M., Seattle, Washington time, on
such date, provided, however, that if such date is not a Business Day, it shall mean 5:00 P.M.,
Seattle, Washington time on the next succeeding Business Day.

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

          (i) “Common Shares,” when used with reference to the Company, shall mean the shares of Common
Stock of the Company, par value $0.001 per share. “Common Shares,” when used with reference to any
Person other than the Company, shall mean the capital stock (or equity interest) with the greatest
voting power of such other Person or, if such other Person is a Subsidiary of another Person, the
Person or Persons which ultimately control such first-mentioned Person.

          (j) “Company” shall mean RealNetworks, Inc., a Washington corporation, subject to the terms of
Section 13(a)(iii)(C) hereof.

          (k) “Current Per Share Market Price” of any security (a “Security” for purposes of this
definition) on any date, for all computations other than those made pursuant to Section
11(a)(iii) hereof, shall mean the average of the daily closing prices per share of such
Security for the thirty (30) consecutive Trading Days immediately prior to such date, and for
purposes of computations made pursuant to Section 11(a)(iii) hereof, the Current Per Share
Market Price of any Security on any date shall be deemed to be the average of the daily closing
prices per share of such Security for the ten (10) consecutive Trading Days immediately prior to
such date; provided, however, that in the event that the Current Per Share Market
Price of the Security is determined during a period following the announcement by the issuer of
such Security of (i) a dividend or distribution on such Security payable in shares of such Security
or securities convertible into such shares or (ii) any subdivision, combination or reclassification
of such Security, and prior to the expiration of the applicable thirty (30) Trading Day or ten (10)
Trading Day period, after the ex-dividend date for such dividend or distribution, or the record
date for such subdivision, combination or reclassification, then, and in each such case, the
Current Per Share Market Price shall be appropriately adjusted to reflect the current market price
per share equivalent of such Security. The closing price for each day shall be the last sale price
as reported by Nasdaq (with respect to securities listed on Nasdaq), 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 New York Stock Exchange or,
if the Security is not listed or admitted to trading on the Nasdaq or the New York Stock Exchange,
as reported in the principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the Security is listed or admitted to
trading or, if the Security is not listed or admitted to trading on any national securities
exchange, the last sale price or, if such last sale price is not reported, the average of the high
bid and low asked prices in the over the counter market as reported

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on such other system then in use, or, if on any such date the Security is not quoted by any
such organization, the average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Security selected by the Board. If on any such date no market
maker is making a market in the Security, the fair value of such shares on such date as determined
in good faith by the Board shall be used. If the Preferred Shares are not publicly traded, the
Current Per Share Market Price of the Preferred Shares shall be conclusively deemed to be (x) the
Current Per Share Market Price of the Common Shares as determined pursuant to this Section
1(k), as appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof, multiplied by (y) 1,000. If the Security is not
publicly held or so listed or traded, Current Per Share Market Price shall mean the fair value per
share as determined in good faith by the Board, whose determination shall be described in a
statement filed with the Rights Agent and shall be conclusive for all purposes.

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

          (m) “Distribution Date” shall mean the earlier of (i) the Close of Business on the tenth
(10th) Business Day (or such later day as may be determined by action of the Board)
after the Shares Acquisition Date (or, if the tenth (10th) Business Day after the Shares
Acquisition Date occurs before the Record Date, the Close of Business on the Record Date) or (ii)
the Close of Business on the tenth (10th) Business Day (or such later day as may be
determined by action of the Board) after the date that a tender or exchange offer by any Person
(other than the Company, any Subsidiary of the Company, any employee benefit plan of the Company or
of any Subsidiary of the Company, or any Person or entity organized, appointed or established by
the Company for or pursuant to the terms of any such plan) is first published or sent or given
within the meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act,
if, assuming the successful consummation thereof, such Person would be an Acquiring Person.

          (n) “Equivalent Shares” shall mean Preferred Shares and any other class or series of capital
stock of the Company which is entitled to the same rights, privileges and preferences as the
Preferred Shares.

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

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

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

          (r) “Expiration Date” shall mean the earliest to occur of: (i) the Close of Business on the
Final Expiration Date, (ii) the Redemption Date, or (iii) the time at which the Board orders the
exchange of the Rights as provided in Section 24 hereof.

          (s) “Final Expiration Date” shall mean December 2, 2018.

          (t) “Grandfathered Shareholder” shall mean Robert Glaser who is the Beneficial Owner of
51,347,162 Common Shares on the date of this Agreement; provided, however that Mr. Glaser shall
cease to be a Grandfathered Shareholder at such time that Mr. Glaser increases

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his Beneficial Ownership of Common Shares to more than 51,347,162 Common Shares (as
appropriately adjusted to reflect any stock split, stock dividend or similar transaction by the
Company on the outstanding Common Shares) except pursuant to acquisitions of Common Shares by Mr.
Glaser resulting from the exercise of stock options or pursuant to stock awards, in either case,
that were granted in connection with his employment with the Company.

          (u) “Nasdaq” shall mean the Nasdaq Global Select Market, any successor stock exchange operated
by The NASDAQ Stock Market LLC or any successor thereto.

          (v) “Person” shall mean any individual, firm, corporation or other entity, and shall include
any successor (by merger or otherwise) of such entity.

          (w) “Post-Event Transferee” shall have the meaning set forth in Section 7(e) hereof.

          (x) “Preferred Shares” shall mean shares of Series A Preferred Stock, par value $0.001 per
share, of the Company having the relative rights, preferences and limitations set forth in the Form
of Certificate of Designation attached to this Agreement as Exhibit A.

          (y) “Pre-Event Transferee” shall have the meaning set forth in Section 7(e) hereof.

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

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

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

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

          (dd) “Rights Agent” shall mean (i) Mellon Investor Services LLC, a New Jersey limited
liability company, (ii) its successor or replacement as provided in Section 19 and
Section 21 hereof or (iii) any additional Person appointed pursuant to Section 2
hereof.

          (ee) “Rights Certificate” shall mean a certificate substantially in the form attached hereto
as Exhibit B.

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

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

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

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          (ii) “Shares Acquisition Date” shall mean the first date of public announcement (which, for
purposes of this definition, shall include, without limitation, a report filed pursuant to Section
13(d) of the Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has
become such; provided that, if such Person is determined not to have become an Acquiring
Person pursuant to Section 1(a) hereof, then no Shares Acquisition Date shall be deemed to
have occurred by virtue of such event.

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

          (kk) “Subsidiary” of any Person shall mean any corporation or other entity of which an amount
of voting securities sufficient to elect a majority of the directors or Persons having similar
authority of such corporation or other entity is beneficially owned, directly or indirectly, by
such Person, or any corporation or other entity otherwise controlled by such Person.

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

          (mm) “Summary of Rights” shall mean a summary of this Agreement substantially in the form
attached hereto as Exhibit C.

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

          (oo) “Trading Day” shall mean a day on which the principal national securities exchange on
which a referenced security is listed or admitted to trading is open for the transaction of
business or, if a referenced security is not listed or admitted to trading on any national
securities exchange, a Business Day.

          (pp) A “Triggering Event” shall be deemed to have occurred upon any Person becoming an
Acquiring Person.

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

     Section 3. Issuance of Rights Certificates. 

          (a) Until the Distribution Date, (i) the Rights will be evidenced (subject to the provisions
of Section 3(b) and Section 3(c) hereof) by the certificates for Common Shares
registered in the names of the holders thereof (which certificates shall also be deemed to be
Rights Certificates) and not by separate Rights Certificates and (ii) the right to receive Rights
Certificates will be transferable only in connection with the transfer of Common Shares. Until the
earlier of the
Distribution Date or the Expiration Date, the surrender for transfer of certificates for
Common Shares shall also constitute the surrender for transfer of the Rights associated with the
Common

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Shares represented thereby. As soon as practicable after the Distribution Date, the Company
will prepare and execute, the Rights Agent will countersign, and the Company will send or cause to
be sent (and the Rights Agent will, if requested, send) by first-class, postage-prepaid mail, to
each record holder of Common Shares as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the Company, a Rights Certificate 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
hereof, then at the time of distribution of the Rights Certificates, the Company shall make the
necessary and appropriate rounding adjustments (in accordance with Section 14(a) hereof) so
that Rights Certificates representing only whole numbers of Rights are distributed and cash is paid
in lieu of any fractional Rights (in accordance with Section 14(a) hereof). As of the
Distribution Date, the Rights will be evidenced solely by such Rights Certificates and may be
transferred by the transfer of the Rights Certificates as permitted hereby, separately and apart
from any transfer of Common Shares, and the holders of such Rights Certificates as listed in the
records of the Company or any transfer agent or registrar for the Rights shall be the record
holders thereof. The Company shall promptly notify the Rights Agent in writing upon the occurrence
of the Distribution Date and, if such notification is given orally, the Company shall confirm the
same in writing on or prior to the Business Day next following. Until such notice is received by
the Rights Agent, the Rights Agent may presume conclusively for all purposes that the Distribution
Date has not occurred.

          (b) With respect to certificates for Common Shares outstanding as of the Record Date, until
the Distribution Date, the Rights will be evidenced by such certificates registered in the names of
the holders thereof together with the Summary of Rights.

          (c) Unless the Board by resolution adopted at or before the time of the issuance of any Common
Shares after the Record Date but prior to the earlier of the Distribution Date or the Expiration
Date (or, in certain circumstances provided in Section 22 hereof, after the Distribution
Date) specifies to the contrary, Rights shall be issued in respect of all Common Shares that are so
issued, and Certificates representing such Common Shares shall also be deemed to be certificates
for Rights, and shall bear a legend in substantially the following form:

THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS
SET FORTH IN AN AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN BETWEEN REALNETWORKS,
INC. (THE “COMPANY”) AND MELLON INVESTOR SERVICES LLC, AS THE RIGHTS AGENT, DATED AS
OF DECEMBER 2, 2008 (AS AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO
TIME, THE “RIGHTS AGREEMENT”), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF 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. THE COMPANY WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY
OF THE RIGHTS AGREEMENT WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR.
UNDER CERTAIN CIRCUMSTANCES SET

-8-

 

FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO, OR
HELD 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 HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, MAY
BECOME NULL AND VOID.

With respect to such certificates containing the foregoing legend, until the earlier of the
Distribution Date or the Expiration Date, the Rights associated with the Common Shares represented
by such certificates shall be evidenced by such certificates alone, and the surrender for transfer
of any such certificate shall also constitute the transfer of the Rights associated with the Common
Shares represented thereby.

          (d) In the event that the Company purchases or acquires any Common Shares after the Record
Date but prior to the Distribution Date, any Rights associated with such Common Shares shall be
deemed canceled and retired so that the Company shall not be entitled to exercise any Rights
associated with the Common Shares which are no longer outstanding.

     Section 4. Form of Rights Certificates.

          (a) The Rights Certificates (and the forms of election to purchase shares and of assignment to
be printed on the reverse thereof) shall be substantially in the form of Exhibit B hereto
and may have such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate (but which do not affect the
rights, duties or responsibilities of the Rights Agent) and are not inconsistent with the
provisions of this Agreement, or as may be required to comply with any applicable law or with any
rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange or a
national market system, on which the Rights may from time to time be listed or included, or to
conform to usage. Subject to the provisions of Section 11 and Section 22 hereof,
the Rights Certificates, whenever distributed, shall be dated as of the Record Date (or in the case
of Rights issued with respect to Common Shares issued by the Company after the Record Date, as of
the date of issuance of such Common Shares) and on their face shall entitle the holders thereof to
purchase such number of one-thousandths (0.001) of a Preferred Share as shall be set forth therein
at the price set forth therein (such exercise price per one one-thousandth (0.001) of a Preferred
Share being hereinafter referred to as the “Exercise Price” and the aggregate Exercise Price of all
Preferred Shares issuable upon exercise of one Right being hereinafter referred to as the “Total
Exercise Price”), but the number and type of securities purchasable upon the exercise of each Right
and the Exercise Price shall be subject to adjustment as provided herein.

          (b) Any Rights Certificate issued pursuant to Section 3(a) or Section 22
hereof that represents Rights beneficially owned by: (i) an Acquiring Person or any Associate or
Affiliate of an Acquiring Person, (ii) a Post-Event Transferee, (iii) a Pre-Event Transferee or
(iv) any subsequent transferee receiving transferred Rights from a Post-Event Transferee or a
Pre-Event Transferee, either directly or through one or more intermediate transferees, and any
Rights Certificate issued
pursuant to Section 6 or Section 11 hereof upon transfer, exchange,
replacement or adjustment of

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any other Rights Certificate referred to in this sentence, shall
contain (to the extent the Rights Agent has knowledge thereof and to the extent feasible) a legend
in substantially the following form:

THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY
A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY,
THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID
IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.

     Section 5. Countersignature and Registration.

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

          (b) Following the Distribution Date and receipt by the Rights Agent of notice to that effect,
the Rights Agent will keep or cause to be kept, at its office designated for such purposes, 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), Section 14 and Section
24 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 Rights Certificates may be
transferred, split up, combined or exchanged for another Rights Certificate or Rights Certificates,
entitling the registered holder to purchase a like number of one-thousandths (0.001) of a Preferred
Share (or, following a
Triggering Event, other securities, cash or other assets, as the case may be) as the Rights
Certificate

-10-

 

or Rights Certificates surrendered then entitled such holder to purchase. Any
registered holder desiring to transfer, split up, combine or exchange any Rights Certificate or
Rights Certificates shall make such request in writing delivered to the Rights Agent, and shall
surrender the Rights Certificate or Rights Certificates to be transferred, split up, combined or
exchanged at the office of the Rights Agent designated for such purpose. The Rights Certificates
are transferable only on the registry books of the Rights Agent. 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 or the Rights Agent 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 or the
Rights Agent may require payment from the registered holder of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split up, combination or
exchange of Rights Certificates. The Rights Agent shall have no duty or obligation under this
Section 6(a) unless and until it is satisfied that all such taxes and/or governmental charges have
been paid.

          (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, at the
Company’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of the Rights
Certificate if mutilated, the Company will make 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; Exercise Price; Expiration Date of Rights.

          (a) Subject to Section 7(e), Section 23(b) and Section 24(b) hereof,
the registered holder of any Rights Certificate may exercise the Rights evidenced thereby (except
as otherwise provided herein) in whole or in part at any time after the Distribution Date and prior
to the Close of Business on the Expiration Date by surrender of the Rights Certificate, with the
form of election to purchase on the reverse side thereof duly executed, to the Rights Agent at the
office of the Rights Agent designated for such purpose, together with payment of the Exercise Price
for each one-thousandth (0.001) of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) as to which the Rights are exercised.

          (b) The Exercise Price for each one-thousandth (0.001) of a Preferred Share issuable pursuant
to the exercise of a Right shall initially be $30.00, shall be subject to adjustment from time to
time as provided in Section 11 and Section 13 hereof and shall be payable in lawful
money of the United States of America in accordance with Section 7(c) below.

          (c) Upon receipt of a Rights Certificate representing exercisable Rights, with the form of
election to purchase duly executed, accompanied by payment of the Exercise Price for the

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number of one-thousandths (0.001) of a Preferred Share (or, following a Triggering Event, other securities,
cash or other assets as the case may be) to be purchased and an amount equal to any applicable tax
or charge required to be paid by the holder of such Rights Certificate in accordance with
Section 9(e) hereof, 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 the Preferred Shares) a certificate or
certificates for the number of one-thousandths (0.001) of a Preferred Share (or, following a
Triggering Event, other securities, cash or other assets as the case may be) 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 one-thousandths (0.001) of a
Preferred Share (or, following a Triggering Event, other securities, cash or other assets as the
case may be) issuable upon exercise of the Rights hereunder with a depository agent, requisition
from the depository agent depository receipts representing such number of one-thousandths (0.001)
of a Preferred Share (or, following a Triggering Event, other securities, cash or other assets as
the case may be) as are to be purchased (in which case certificates for the Preferred Shares (or,
following a Triggering Event, other securities, cash or other assets as the case may be)
represented by such receipts shall be deposited by the transfer agent with the depository agent)
and the Company hereby directs the depository agent to comply with such request, (ii) when
appropriate, requisition from the Company the amount of cash to be paid in lieu of issuance of
fractional shares in accordance with Section 14 hereof, (iii) after receipt of such
certificates or depository 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) when appropriate, after receipt thereof, deliver such cash to or upon the
order of the registered holder of such Rights Certificate. The payment of the Exercise Price (as
such amount may be reduced (including to zero) pursuant to Section 11(a)(iii) hereof) and
an amount equal to any applicable tax or charge required to be paid by the holder of such Rights
Certificate in accordance with Section 9(e) hereof, may be made in cash or by certified
bank check, cashier’s check or bank draft payable to the order of the Company. In the event that
the Company is obligated to issue securities of the Company other than Preferred Shares, pay cash
and/or distribute other property pursuant to Section 11(a) hereof, the Company will make
all arrangements necessary so that such other securities, cash and/or other property are available
for distribution by the Rights Agent, if and when appropriate.

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

          (e) Notwithstanding anything in this Agreement to the contrary, from and after the first
occurrence of a Triggering Event, any Rights beneficially owned by (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 (a
“Post-Event Transferee”), (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 to holders of equity interests in such Acquiring Person or to any
Person

-12-

 

with whom the Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board has determined is part of a
plan, arrangement or understanding which has as a primary purpose or effect the avoidance of this
Section 7(e) (a “Pre-Event Transferee”) or (iv) any subsequent transferee receiving
transferred Rights from a Post-Event Transferee or a Pre-Event Transferee, either directly or
through one or more intermediate transferees, 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) and Section 4(b) hereof are
complied with, but shall have no liability to any holder of Rights Certificates or to any other
Person as a result of its failure to make any determinations with respect to an Acquiring Person or
any of such Acquiring Person’s Affiliates, Associates or transferees hereunder. The Company shall
give the Rights Agent written notice of the identity of any such Acquiring Person, Associate or
Affiliate, or the nominee of any of the foregoing, and the Rights Agent may rely on such notice in
carrying out its duties under this Agreement and shall be deemed not to have any knowledge of the
identity of any such Acquiring Person, Associate or Affiliate, or the nominee of any of the
foregoing unless and until it shall have received such notice.

          (f) Notwithstanding anything in this Agreement to the contrary, neither the Rights Agent nor
the Company shall be obligated to undertake any action with respect to a registered holder upon the
occurrence of any purported exercise as set forth in Section 7 unless such registered
holder shall, in addition to having complied with the requirements of Section 7(a), 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 or the Rights Agent 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 to any of its agents, be delivered to the Rights Agent for
cancellation or in canceled form, or, if surrendered to the Rights Agent, shall be canceled by it,
and no 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 Rights Certificate purchased
or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Rights Certificates to the Company, or shall, at the written request of the
Company, destroy such canceled Rights Certificates, and in such case shall deliver a certificate
evidencing the destruction thereof to the Company.

     Section 9. Reservation and Availability of Preferred Shares.

          (a) The Company covenants and agrees that it will use its best efforts to cause to be reserved
and kept available out of its authorized and unissued Preferred Shares not reserved for another
purpose (and, following the occurrence of a Triggering Event, out of its authorized and
unissued Common Shares and/or other securities), the number of Preferred Shares (and,
following

-13-

 

the occurrence of the Triggering Event, Common Shares and/or other securities) that will
be sufficient to permit the exercise in full of all outstanding Rights.

          (b) If the Company shall hereafter list any of its Preferred Shares on a national securities
exchange, then so long as the Preferred Shares (and, following the occurrence of a Triggering
Event, Common Shares and/or other securities) issuable and deliverable upon exercise of the Rights
may be listed on such exchange, the Company shall use its best efforts to cause, from and after
such time as the Rights become exercisable (but only to the extent that it is reasonably likely
that the Rights will be exercised), all shares reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.

          (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 Triggering Event in which the consideration to be
delivered by the Company upon exercise of the Rights is described in Section 11(a)(ii) or
Section 11(a)(iii) hereof, or as soon as is required by law following the Distribution
Date, as the case may be, a registration statement under the Securities Act with respect to the
securities purchasable upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable after such filing and (iii) cause
such registration statement to remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the earlier of (A) the date as of which the Rights are no
longer exercisable for such securities and (B) the date of expiration of the Rights. The Company
may temporarily suspend, for a period not to exceed ninety (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, and notify the Rights
Agent, that the exercisability of the Rights has been temporarily suspended, as well as a public
announcement and notification to the Rights Agent at such time as the suspension is no longer in
effect. 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. Notwithstanding any provision of this Agreement to the contrary, the
Rights shall not be exercisable in any jurisdiction, unless the requisite qualification in such
jurisdiction shall have been obtained, or an exemption therefrom shall be available, and until a
registration statement has been declared and remains effective.

          (d) The Company covenants and agrees that it will take all such action as may be necessary to
ensure that all Preferred Shares (or other securities of the Company) delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such securities (subject to payment
of the Exercise Price), be duly and validly authorized and issued and fully paid and nonassessable
shares.

          (e) The Company further covenants and agrees that it will pay when due and payable any and all
taxes and governmental charges which may be payable in respect of the original issuance or delivery
of the Rights Certificates or of any Preferred Shares (or other securities of the Company) upon the
exercise of Rights. The Company shall not, however, be required to pay any tax or governmental
charge which may be payable in respect of any transfer or delivery of Rights Certificates to a
person other than, or the issuance or delivery of certificates or depository receipts
for the Preferred Shares (or other securities of the Company) in a name other than that of,
the

-14-

 

registered holder of the Rights Certificate evidencing Rights surrendered for exercise or to
issue or to deliver any certificates or depository receipts for Preferred Shares (or other
securities of the Company) upon the exercise of any Rights until any such tax or governmental
charge shall have been paid (any such tax or governmental charge being payable by the holder of
such Rights Certificate at the time of surrender) or until it has been established to the Company’s
or the Rights Agent’s satisfaction that no such tax or governmental charge is due.

     Section 10. Record Date. Each Person in whose name any certificate for a number of
one-thousandths (0.001) of a Preferred Share (or other securities of the Company) is issued upon
the exercise of Rights shall for all purposes be deemed to have become the holder of record of
Preferred Shares (or other securities of the Company) represented thereby on, and such certificate
shall be dated, the date upon which the Rights Certificate evidencing such Rights was duly
surrendered with the forms of election and certification duly executed and payment of the Total
Exercise Price with respect to which the Rights have been exercised (and any applicable taxes or
charges) was made; provided, however, that if the date of such surrender and
payment is a date upon which the transfer books of the Company are closed, such Person shall be
deemed to have become the record holder of such shares on, and such certificate shall be dated, the
next succeeding Business Day on which the transfer books of the Company are open. Prior to the
exercise of the Rights evidenced thereby, the holder of a Rights Certificate shall not be entitled
to any rights of a holder of Preferred Shares (or other securities of the Company) 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 Exercise Price, Number of Shares or Number of Rights. The Exercise
Price, the number and kind of shares or other property covered by each Right and the number of
Rights outstanding are subject to adjustment from time to time as provided in this Section
11.

          (a) (i) Anything in this Agreement to the contrary notwithstanding, in the event that the
Company shall at any time after the date of this Agreement (A) declare a dividend on the Preferred
Shares payable in Preferred Shares, (B) subdivide the outstanding Preferred Shares, (C) combine the
outstanding Preferred Shares (by reverse stock split or otherwise) into a smaller number of
Preferred Shares, or (D) issue any shares of its capital stock in a reclassification of the
Preferred Shares (including any such reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving corporation), then, in each such event, except
as otherwise provided in this Section 11 and Section 7(e) hereof: (1) the Exercise
Price in effect at the time of the record date for such dividend or of the effective date of such
subdivision, combination or reclassification shall be adjusted so that the Exercise Price
thereafter shall equal the result obtained by dividing the Exercise Price in effect immediately
prior to such time by a fraction (the “Adjustment Fraction”), the numerator of which shall be the
total number of Preferred Shares (or shares of capital stock issued in such reclassification of the
Preferred Shares) outstanding immediately following such time and the denominator of which shall be
the total number of
Preferred Shares outstanding immediately prior to such time; provided,
however, that in no event shall the consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of capital stock of the Company issuable upon
exercise of such Right; and (2) the

-15-

 

number of one-thousandths (0.001) of a Preferred Share (or
share of such other capital stock) issuable upon the exercise of each Right shall equal the number
of one-thousandths (0.001) of a Preferred Share (or share of such other capital stock) as was
issuable upon exercise of a Right immediately prior to the occurrence of the event described in
clauses (A) through (D) of this Section 11(a)(i), multiplied by the
Adjustment Fraction; provided, however, that, no such adjustment shall be made pursuant to this
Section 11(a)(i) to the extent that there shall have simultaneously occurred an event
described in clause (A), (B), (C) or (D) of Section 11(n)
with a proportionate adjustment being made thereunder. Each Common Share that shall become
outstanding after an adjustment has been made pursuant to this Section 11(a)(i) shall have
associated with it the number of Rights, exercisable at the Exercise Price and for the number of
one-thousandths (0.001) of a Preferred Share (or shares of such other capital stock) as one Common
Share has associated with it immediately following the adjustment made pursuant to this Section
11(a)(i).

               (ii) Subject to Section 24 of this Agreement, in the event that a Triggering Event
shall have occurred, then promptly following such Triggering Event each holder of a Right, except
as provided in Section 7(e) hereof, shall thereafter have the right to receive for each
Right, upon exercise thereof in accordance with the terms of this Agreement and payment of the
Exercise Price in effect immediately prior to the occurrence of the Triggering Event, in lieu of a
number of one-thousandths (0.001) of a Preferred Share, such number of Common Shares of the Company
as shall equal the quotient obtained by dividing (A) the product obtained by multiplying (1) the
Exercise Price in effect immediately prior to the occurrence of the Triggering Event by (2) the
number of one-thousandths (0.001) of a Preferred Share for which a Right was exercisable (or would
have been exercisable if the Distribution Date had occurred) immediately prior to the first
occurrence of a Triggering Event, by (B) fifty percent (50%) of the Current Per Share Market Price
for Common Shares on the date of occurrence of the Triggering Event; provided,
however, that the Exercise Price and the number of Common Shares of the Company so
receivable upon exercise of a Right shall be subject to further adjustment as appropriate in
accordance with Section 11(e) hereof to reflect any events occurring in respect of the
Common Shares of the Company after the occurrence of the Triggering Event.

               (iii) In lieu of issuing Common Shares in accordance with Section 11(a)(ii) hereof,
the Company may, if the Board determines that such action is necessary or appropriate and not
contrary to the interest of holders of Rights and, in the event that the number of Common Shares
which are authorized by the Company’s Articles of Incorporation but 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, or if any necessary regulatory approval for such issuance has not
been obtained by the Company, the Company shall: (A) determine the excess of (1) the value of the
Common Shares issuable upon the exercise of a Right (the “Current Value”) over (2) the Exercise
Price (such excess, the “Spread”) and (B) with respect to each Right, make adequate provision to
substitute for such Common Shares, upon exercise of the Rights, (1) cash, (2) a reduction in the
Exercise Price, (3) other equity securities of the Company (including, without limitation, shares
or units of shares of any series of preferred stock which the Board has deemed to have the same
value as Common Shares (such shares or units of shares of preferred stock are herein called
“Common Stock Equivalents”)), except to the extent that the Company has not obtained any necessary
shareholder or regulatory approval for such issuance, (4) debt securities of the Company, except to
the extent that the Company has not obtained any necessary shareholder or regulatory approval for

-16-

 

such issuance, (5) other assets or (6) any combination of the foregoing, having an aggregate value
equal to the Current Value, where such aggregate value has been determined by the Board based upon
the advice of a nationally recognized investment banking firm selected by the Board;
provided, however, that if the Company shall not have made adequate provision to
deliver value pursuant to clause (B) above within thirty (30) days following the later of (x) the
first occurrence of a Triggering Event and (y) the date on which the Company’s right of redemption
pursuant to Section 23(a) expires (the later of (x) and (y) being referred to herein as the
“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 Exercise Price, Common
Shares (to the extent available), except to the extent that the Company has not obtained any
necessary shareholder or regulatory approval for such issuance, and then, if necessary, cash, which
shares and/or cash have an aggregate value equal to the Spread. If the Board shall determine in
good faith that it is likely that sufficient additional Common Shares could be authorized for
issuance upon exercise in full of the Rights or that any necessary regulatory approval for such
issuance will be obtained, the thirty (30) day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the Section 11(a)(ii) Trigger Date, in order
that the Company may seek shareholder approval for the authorization of such additional shares or
take action to obtain such regulatory approval (such period, as it may be extended, the
“Substitution Period”). To the extent that the Company determines that some action need be taken
pursuant to the first and/or second sentences of this Section 11(a)(iii), the Company (x)
shall provide, subject to Section 7(e) hereof, that such action shall apply uniformly to
all outstanding Rights and (y) may suspend the exercisability of the Rights until the expiration of
the Substitution Period in order to seek any authorization of additional shares, to take any action
to obtain any required regulatory approval and/or to decide the appropriate form of distribution to
be made pursuant to such first sentence and to determine the value thereof. In the event of any
such suspension, the Company shall issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement at such time as the
suspension is no longer in effect. The Company shall notify the Rights Agent whenever it makes a
public announcement pursuant to this Section 11(a) and give the Rights Agent a copy of such
announcement. For purposes of this Section 11(a)(iii), the value of the Common Shares
shall be the Current Per Share Market Price of the Common Shares on the Section 11(a)(ii) Trigger
Date and the value of any Common Stock Equivalent shall be deemed to have the same value as the
Common Shares on such date.

          (b) In case the Company shall, at any time after the date of this Agreement, fix a record date
for the issuance of rights, options or warrants to all holders of Preferred Shares entitling such
holders (for a period expiring within forty-five (45) calendar days after such record date) to
subscribe for or purchase Preferred Shares or Equivalent Shares or securities convertible into
Preferred Shares or Equivalent Shares at a price per share (or having a conversion price per share,
if a security convertible into Preferred Shares or Equivalent Shares) less than the then Current
Per Share Market Price of the Preferred Shares or Equivalent Shares on such record date, then, in
each such case, the Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of Preferred Shares and Equivalent Shares (if any)
outstanding on such
record date, plus the number of Preferred Shares or Equivalent Shares, as the case may be,
which the aggregate offering price of the total number of Preferred Shares or Equivalent Shares, as
the case may be, to be offered or issued (and/or the aggregate initial conversion price of the
convertible

-17-

 

securities to be offered or issued) would purchase at such Current Per Share Market
Price, and the denominator of which shall be the number of Preferred Shares and Equivalent Shares
(if any) outstanding on such record date, plus the number of additional Preferred Shares or
Equivalent Shares, as the case may be, to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible); provided,
however, that in no event shall the consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of capital stock of the Company issuable upon
exercise of one Right. In case such subscription price may be paid in a consideration part or all
of which shall be in a form other than cash, the value of such consideration shall be as determined
in good faith by the Board, whose determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the holders of the Rights. Preferred
Shares and Equivalent Shares owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall be made successively
whenever such a record date is fixed, and in the event that such rights, options or warrants are
not so issued, the Exercise Price shall be adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed.

          (c) In case the Company shall, at any time after the date of this Agreement, fix a record date
for the making of a distribution to all holders of the Preferred Shares or of any class or series
of Equivalent Shares (including any such distribution made in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation) of evidences of
indebtedness or assets (other than a regular quarterly cash dividend, if any, or a dividend payable
in Preferred Shares) or subscription rights, options or warrants (excluding those referred to in
Section 11(b)), then, in each such case, the Exercise Price to be in effect after such
record date shall be determined by multiplying the Exercise Price in effect immediately prior to
such record date by a fraction, the numerator of which shall be the Current Per Share Market Price
of a Preferred Share or an Equivalent Share on such record date, less the fair market value per
Preferred Share or Equivalent Share (as determined in good faith by the Board, whose determination
shall be described in a statement filed with the Rights Agent) of the portion of the cash, assets
or evidences of indebtedness so to be distributed or of such subscription rights or warrants
applicable to a Preferred Share or Equivalent Share, as the case may be, and the denominator of
which shall be such Current Per Share Market Price of a Preferred Share or Equivalent Share on such
record date; provided, however, that in no event shall the consideration to be paid
upon the exercise of one Right be less than the aggregate par value of the shares of capital stock
of the Company issuable upon exercise of one Right. 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
Exercise Price shall be adjusted to be the Exercise Price which would have been in effect if such
record date had not been fixed.

          (d) Anything herein to the contrary notwithstanding, no adjustment in the Exercise Price shall
be required unless such adjustment would require an increase or decrease of at least one percent
(1%) of the Exercise Price; provided, however, that any adjustments which by reason
of this Section 11(d) 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 (0.0001) of a Common Share or other share or one
hundred-thousandth (0.00001) of a Preferred Share, as the case may be. Notwithstanding the first
sentence of this Section 11(d), any adjustment required by this Section 11 shall be
made no later than

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the earlier of (i) three (3) years from the date of the transaction which
requires such adjustment or (ii) the Expiration Date.

          (e) If as a result of an adjustment made pursuant to Section 11(a) or Section
13(a) hereof, the holder of any Right thereafter exercised shall become entitled to receive any
shares of capital stock other than Preferred Shares, thereafter the number of such other shares so
receivable upon exercise of any Right and, if required, the Exercise 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 Section
11(a), Section 11(b), Section 11(c), Section 11(d), Section
11(g), Section 11(h), Section 11(i), Section 11(j), Section
11(k) and Section 11(l), and the provisions of Section 7, Section 9,
Section 10, Section 13 and Section 14 with respect to the Preferred Shares
shall apply on like terms to any such other shares.

          (f) All Rights originally issued by the Company subsequent to any adjustment made to the
Exercise Price hereunder shall evidence the right to purchase, at the adjusted Exercise Price, the
number of one-thousandths (0.001) of a Preferred Share purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as provided herein.

          (g) Unless the Company shall have exercised its election as provided in Section 11(h),
upon each adjustment of the Exercise Price as a result of the calculations made in Section
11(b) and Section 11(c), each Right outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that
number of Preferred Shares (calculated to the nearest one hundred-thousandth (0.00001) of a share)
obtained by (i) multiplying (x) the number of Preferred Shares covered by a Right immediately prior
to this adjustment, by (y) the Exercise Price in effect immediately prior to such adjustment of the
Exercise Price and (ii) dividing the product so obtained by the Exercise Price in effect
immediately after such adjustment of the Exercise Price.

          (h) The Company may elect on or after the date of any adjustment of the Exercise Price as a
result of the calculations made in Section 11(b)  or Section 11(c) to adjust the
number of Rights, in substitution for any adjustment in the number of Preferred Shares purchasable
upon the exercise of a Right. Each of the Rights outstanding after such adjustment of the number
of Rights shall be exercisable for the number of one-thousandths (0.001) 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 hundred-thousandth (0.00001)) obtained by dividing the Exercise Price in effect
immediately prior to adjustment of the Exercise Price by the Exercise Price in effect immediately
after adjustment of the Exercise Price. The Company shall make a public announcement (and will
provide prompt written notice thereof to the Rights Agent) 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 Exercise Price is adjusted or
any day thereafter, but, if any Rights Certificates have been issued, shall be at least ten (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(h), 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

-19-

 

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 Exercise 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.

          (i) Irrespective of any adjustment or change in the Exercise Price or the number of Preferred
Shares issuable upon the exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Exercise Price per one one-thousandth (0.001) of a Preferred
Share and the number of one-thousandths (0.001) of a Preferred Share which were expressed in the
initial Rights Certificates issued hereunder.

          (j) Before taking any action that would cause an adjustment reducing the Exercise Price below
the par or stated value, if any, of the number of one-thousandths (0.001) of a Preferred Share
issuable upon exercise of the Rights, the Company shall take any corporate action which may, in the
opinion of its counsel, be necessary in order that the Company may validly and legally issue as
fully paid and nonassessable shares such number of one-thousandths (0.001) of a Preferred Share at
such adjusted Exercise Price.

          (k) In any case in which this Section 11 shall require that an adjustment in the
Exercise Price be made effective as of a record date for a specified event, the Company may elect
to defer (with prompt written notice thereof to the Rights Agent) until the occurrence of such
event the issuing to the holder of any Right exercised after such record date of the number of
one-thousandths (0.001) 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-thousandths (0.001) of a
Preferred Share and other capital stock or securities of the Company, if any, issuable upon such
exercise on the basis of the Exercise 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) upon the occurrence of the event requiring such adjustment.

          (l) Anything in this Section 11 to the contrary notwithstanding, prior to the
Distribution Date, the Company shall be entitled to make such reductions in the Exercise Price, in
addition to those adjustments expressly required by this Section 11, as and to the extent
that it in its sole discretion shall determine to be advisable in order that any (i) consolidation
or subdivision of the Preferred Shares or Common Shares, (ii) issuance wholly for cash of any
Preferred Shares or Common Shares at less than the current market price, (iii) issuance wholly for
cash of Preferred Shares or Common Shares or securities which by their terms are convertible into
or exchangeable for Preferred Shares or Common Shares, (iv) stock dividends or (v) issuance of
rights, options or
warrants referred to in this Section 11, hereafter made by the Company to holders of
its Preferred Shares or Common Shares shall not be taxable to such shareholders.

-20-

 

          (m) 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
to be taken) 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.

          (n) In the event that the Company shall at any time after the date of this Agreement (A)
declare a dividend on the Common Shares payable in Common Shares, (B) subdivide the outstanding
Common Shares, (C) combine the outstanding Common Shares (by reverse stock split or otherwise) into
a smaller number of Common Shares, or (D) issue any shares of its capital stock in a
reclassification of the Common Shares (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or surviving corporation), then, in
each such event, except as otherwise provided in this Section 11 and Section 7(e)
hereof: (1) each Common Share (or shares of capital stock issued in such reclassification of the
Common Shares) outstanding immediately following such time shall have associated with it the number
of Rights as were associated with one Common Share immediately prior to the occurrence of the event
described in clauses (A) through (D) of this Section 11(n); (2) the
Exercise Price in effect at the time of the record date for such dividend or of the effective date
of such subdivision, combination or reclassification shall be adjusted so that the Exercise Price
thereafter shall equal the result obtained by multiplying the Exercise Price in effect immediately
prior to such time by a fraction, the numerator of which shall be the total number of Common Shares
outstanding immediately prior to the event described in clauses (A) through (D) of
this Section 11(n), and the denominator of which shall be the total number of Common Shares
outstanding immediately after such event; provided, however, that in no event shall
the consideration to be paid upon the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon exercise of such Right; and (3) the number
of one-thousandths (0.001) of a Preferred Share (or shares of such other capital stock) issuable
upon the exercise of each Right outstanding after such event shall equal the number of
one-thousandths (0.001) of a Preferred Share (or shares of such other capital stock) as were
issuable with respect to one Right immediately prior to such event. Each Common Share that shall
become outstanding after an adjustment has been made pursuant to this Section 11(n) shall
have associated with it the number of Rights, exercisable at the Exercise Price and for the number
of one-thousandths (0.001) of a Preferred Share (or shares of such other capital stock) as one
Common Share has associated with it immediately following the adjustment made pursuant to this
Section 11(n). If an event occurs which would require an adjustment under both this
Section 11(n) and Section 11(a)(ii) hereof, the adjustment provided for in this
Section 11(n) shall be in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii) hereof.

     Section 12. Certificate of Adjusted Exercise Price or Number of Shares. Whenever an adjustment is
made as provided in Section 11 and Section 13 hereof, the Company shall promptly
(a) prepare a certificate setting forth such adjustment or describing such event and a brief,
reasonably detailed statement of the facts, computations and methodology accounting for such
adjustment, (b) file with the Rights Agent and with each transfer agent for the
Preferred Shares a copy of such certificate and (c) mail a brief summary thereof to each
holder of a Rights Certificate in accordance with Section 26 hereof. Notwithstanding the
foregoing sentence, the failure of the Company to make such certification or give such notice shall
not affect the validity of such adjustment or the force or effect of the requirement for such
adjustment. The Rights Agent shall be fully protected in

-21-

 

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

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

          (a) In the event that, following a Triggering Event, directly or indirectly:

               (i) the Company shall consolidate with, or merge with and into, any other Person (other than a
wholly-owned Subsidiary of the Company in a transaction the principal purpose of which is to change
the state of incorporation of the Company and which complies with Section 11(m) hereof);

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

               (iii) the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall
sell or otherwise transfer), in one or more transactions, assets or earning power aggregating fifty
percent (50%) or more of the assets or earning power of the Company and its Subsidiaries (taken as
a whole) to any other Person or Persons (other than the Company or one or more of its wholly owned
Subsidiaries in one or more transactions, each of which individually (and together) complies with
Section 11(m) hereof),

               then, concurrent with and in each such case,

                    (A) each holder of a Right (except as provided in Section 7(e) hereof) shall
thereafter have the right to receive, upon the exercise thereof at a price equal to the Total
Exercise Price applicable immediately prior to the occurrence of the Section 13 Event in accordance
with the terms of this Agreement, such number of validly authorized and issued, fully paid,
nonassessable and freely tradeable Common Shares of the Principal Party (as hereinafter defined),
free of any liens, encumbrances, rights of first refusal or other adverse claims, as shall be equal
to the result obtained by dividing such Total Exercise Price by an amount equal to fifty percent
(50%) of the Current Per Share Market Price of the Common Shares of such Principal Party on the
date of consummation of such Section 13 Event, provided, however, that the Exercise
Price and the number of Common Shares of such Principal Party so receivable upon exercise of a
Right shall be subject to further adjustment as appropriate in accordance with Section
11(e) hereof;

                    (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;

-22-

 

                    (D) such Principal Party shall take such steps (including, but not limited to, the reservation
of a sufficient number of its Common Shares) in connection with the consummation of any such
transaction as may be necessary to ensure 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) upon the subsequent occurrence of any consolidation, merger, sale or transfer of assets or
other extraordinary transaction in respect of such Principal Party, each holder of a Right shall
thereupon be entitled to receive, upon exercise of a Right and payment of the Total Exercise Price
as provided in this Section 13(a), such cash, shares, rights, warrants and other property
which such holder would have been entitled to receive had such holder, at the time of such
transaction, owned the Common Shares of the Principal Party receivable upon the exercise of such
Right pursuant to this Section 13(a), and such Principal Party shall take such steps
(including, but not limited to, reservation of shares of stock) as may be necessary to permit the
subsequent exercise of the Rights in accordance with the terms hereof for such cash, shares,
rights, warrants and other property.

          (b) For purposes hereof, the “earning power” of the Company and its Subsidiaries shall be
determined in good faith by the Board on the basis of the operating income of each business
operated by the Company and its Subsidiaries during the three fiscal years preceding the date of
such determination (or, in the case of any business not operated by the Company or any Subsidiary
during three full fiscal years preceding such date, during the period such business was operated by
the Company or any Subsidiary).

          (c) For purposes of this Agreement, the term “Principal Party” shall mean:

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

               (ii) in the case of any transaction described in clause (iii) of Section 13(a) hereof,
the Person that is the party receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if more than one Person that is a
party to such transaction or transactions receives the same portion of the assets or earning power
so transferred and each such portion would, were it not for the other equal portions, constitute
the greatest portion of the assets or earning power so transferred, or if the Person receiving the
greatest portion of the assets or earning power cannot be determined, whichever of such Persons is the
issuer of Common Shares having the greatest aggregate market value of shares outstanding;

-23-

 

provided, however, that in any such case described in the foregoing Section
13(c)(i) or Section 13(c)(ii), if the Common Shares of such Person are not at such time
or have not been continuously over the preceding 12-month period registered under Section 12 of the
Exchange Act, then (1) if such Person is a direct or indirect Subsidiary of another Person the
Common Shares of which are and have been so registered, the term “Principal Party” shall refer to
such other Person, or (2) if such Person is a Subsidiary, directly or indirectly, of more than one
Person, the Common Shares of which are and have been so registered, the term “Principal Party”
shall refer to whichever of such Persons is the issuer of Common Shares having the greatest
aggregate market value of shares outstanding, or (3) if such Person is owned, directly or
indirectly, by a joint venture formed by two or more Persons that are not owned, directly or
indirectly by the same Person, the rules set forth in clauses (1) and (2) above
shall apply to each of the owners having an interest in the venture as if the Person owned by the
joint venture was a Subsidiary of both or all of such joint venturers, and the Principal Party in
each such case shall bear the obligations set forth in this Section 13 in the same ratio as
its interest in such Person bears to the total of such interests.

          (d) The Company shall not consummate any 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 such Principal Party shall, upon
consummation of such Section 13 Event, assume this Agreement in accordance with Section
13(a), Section 13(b) and Section 13(c) hereof, that all rights of first refusal
or preemptive rights in respect of the issuance of Common Shares of such Principal Party upon
exercise of outstanding Rights have been waived, that there are no rights, warrants, instruments or
securities outstanding or any agreements or arrangements which, as a result of the consummation of
such transaction, would eliminate or substantially diminish the benefits intended to be afforded by
the Rights and that such transaction shall not result in a default by such Principal Party under
this Agreement, and further providing that, as soon as practicable after the date of such Section
13 Event, such Principal Party will:

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

               (ii) use its best efforts to list (or continue the listing of) the Rights and the securities
purchasable upon exercise of the Rights on a national securities exchange or to meet the
eligibility requirements for quotation on Nasdaq and list (or continue the listing of) the Rights
and the securities purchasable upon exercise of the Rights on Nasdaq; and

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

-24-

 

     In the event that at any time after the occurrence of a Triggering Event some or all of the
Rights shall not have been exercised at the time of a transaction described in this Section
13, the Rights which have not theretofore been exercised shall thereafter be exercisable in the
manner described in Section 13(a) (without taking into account any prior adjustment
required by Section 11(a)(ii)).

          (e) In case the “Principal Party” for purposes of Section 13(c) hereof has provision
in any of its authorized securities or in its certificate of incorporation or by-laws or other
instrument governing its corporate affairs, which provision would have the effect of (i) causing
such Principal Party to issue (other than to holders of Rights pursuant to Section 13
hereof), in connection with, or as a consequence of, the consummation of a Section 13 Event, Common
Shares or Equivalent Shares of such Principal Party at less than the then Current Per Share Market
Price thereof or securities exercisable for, or convertible into, Common Shares or Equivalent
Shares of such Principal Party at less than such then Current Per Share Market Price, or (ii)
providing for any special payment, tax or similar provision in connection with the issuance of the
Common Shares of such Principal Party pursuant to the provisions of Section 13 hereof,
then, in such event, the Company hereby agrees with each holder of Rights that it shall not
consummate any such transaction unless prior thereto the Company and such Principal Party shall
have executed and delivered to the Rights Agent a supplemental agreement providing that the
provision in question of such Principal Party shall have been canceled, waived or amended, or that
the authorized securities shall be redeemed, so that the applicable provision will have no effect
in connection with or as a consequence of, the consummation of the proposed transaction.

          (f) The Company covenants and agrees that it shall not, at any time after the Distribution
Date, effect or permit to occur any Section 13 Event, if (i) at the time or immediately after such
Section 13 Event there are any rights, warrants or other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise eliminate the benefits
intended to be afforded by the Rights, (ii) prior to, simultaneously with or immediately after such
Section 13 Event, the shareholders of the Person who constitutes, or would constitute, the
“Principal Party” for purposes of Section 13(c) hereof shall have received a distribution
of Rights previously owned by such Person or any of its Affiliates or Associates or (iii) the form
or nature of organization of the Principal Party would preclude or limit the exercisability of the
Rights.

          (g) The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.

     Section 14. Fractional Rights and Fractional Shares.

          (a) The Company shall not be required to issue fractions of Rights or to distribute Rights
Certificates which evidence fractional Rights. In lieu of such fractional Rights, there shall be
paid to the registered holders of the Rights Certificates with regard to which such fractional
Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current
market value of a whole Right. For the purposes of this Section 14(a), the current market
value of a whole Right shall be the closing price of the Rights for the Trading Day immediately
prior to the date on which such fractional Rights would have been otherwise issuable, as determined
pursuant to the second sentence of Section 1(k) hereof.

-25-

 

          (b) The Company shall not be required to issue fractions of Preferred Shares (other than
fractions that are integral multiples of one one-thousandth (0.001) of a Preferred Share) upon
exercise of the Rights or to distribute certificates which evidence fractional Preferred Shares
(other than fractions that are integral multiples of one one-thousandth (0.001) of a Preferred
Share).  Interests in fractions of Preferred Shares in integral multiples of one one-thousandth
(0.001) of a Preferred Share may, at the election of the Company, be evidenced by depository
receipts, pursuant to an appropriate agreement between the Company and a depository selected by it;
provided, that such agreement shall provide that the holders of such depository receipts
shall have all the rights, privileges and preferences to which they are entitled as beneficial
owners of the Preferred Shares represented by such depository receipts. In lieu of fractional
Preferred Shares that are not integral multiples of one one-thousandth (0.001) of a Preferred
Share, the Company shall 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 a Preferred Share. For purposes of this Section 14(b), the current market
value of a Preferred Share shall be (x) one thousand multiplied by (y) the closing price of a
Common Share (as determined pursuant to the second sentence of Section 1(k) hereof) for the
Trading Day immediately prior to the date of such exercise.

          (c) The Company shall not be required to issue fractions of Common Shares or to distribute
certificates which evidence fractional Common Shares upon the exercise or exchange of Rights.  In
lieu of such fractional Common Shares, the Company shall 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 a Common Share. For purposes of this
Section 14(c), the current market value of a Common Share shall be the closing price of a
Common Share (as determined pursuant to the second sentence of Section 1(k) hereof) for the
Trading Day immediately prior to the date of such exercise.

          (d) The holder of a Right by the acceptance of the Right expressly waives his, her or its
right to receive any fractional Rights or any fractional shares (other than as provided above) upon
exercise of a Right. 

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

     Section 15. Rights of Action. All rights of action in respect of this Agreement, excepting the rights of action given
to the Rights Agent pursuant to Section 18 hereof, are vested in the respective registered
holders of the
Rights Certificates (and, prior to the Distribution Date, the registered holders of the Common
Shares); and any registered holder of any Rights Certificate (or, prior to the Distribution Date,
of the Common Shares), without the consent of the Rights Agent or of

-26-

 

the holder of any other Rights
Certificate (or, prior to the Distribution Date, of the Common Shares), may, in his, her or its own
behalf and for his, her or its own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise act in respect of, his, her or
its right to exercise the Rights evidenced by such Rights Certificate in the manner provided in
such Rights Certificate and in this Agreement. Without limiting the foregoing or any remedies
available to the holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach by the Company of this Agreement and will
be entitled to specific performance of the obligations under, and injunctive relief against actual
or threatened violations by the Company of, the obligations of any Person subject to this
Agreement.

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

          (a) prior to the Distribution Date, the Rights will be transferable only in connection with
the transfer of the 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 duly completed and fully executed; and

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

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

     Section 18. Concerning the Rights Agent. 

          (a) The Company agrees to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time, on demand of the Rights Agent, its

-27-

 

reasonable
expenses and counsel fees and other disbursements incurred in the preparation, delivery, amendment,
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, damage, judgment, fine, penalty, claim, demand, settlement, cost or
expense (including, without limitation, the reasonable fees and expenses of legal counsel),
incurred without gross negligence, bad faith or willful misconduct on the part of the Rights Agent
(which gross negligence, bad faith or willful misconduct must be determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent jurisdiction), for any
action taken, suffered or omitted by the Rights Agent in connection with the acceptance,
administration, exercise and performance of its duties under this Agreement. Notwithstanding the
foregoing, in the event it is determined by a final, non-appealable order, judgment, decree or
ruling of a court of competent jurisdiction that the Rights Agent is not entitled to be indemnified
hereunder, the Rights Agent shall reimburse the Company for all amounts theretofore paid to the
Rights Agent for which the Rights Agent was not entitled. Notwithstanding anything herein to the
contrary, in no event will the Rights Agent be liable for special, punitive, indirect, incidental
or consequential loss or damage of any kind whatsoever (including, but not limited to, lost
profits), even if the Rights Agent has been advised of the possibility of such loss or damage. The
costs and expenses incurred in enforcing this right of indemnification shall be paid by the
Company. Any liability of the Rights Agent under this Agreement will be limited to the amount of
annual fees paid by the Company to the Rights Agent. The provisions of this Section 18 and Section
20 below shall survive the termination of this Agreement, the exercise or expiration of the Rights
and the resignation, replacement or removal of the Rights Agent

          (b) The Rights Agent shall be authorized and protected and shall incur no liability for, or in
respect of any action taken, suffered or omitted by it in connection with, its acceptance and
administration of this Agreement and the exercise and performance of its duties hereunder in
reliance upon any Rights Certificate or certificate for the Preferred Shares or Common Shares or
for other securities of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper
or document reasonably believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or Persons, or otherwise upon the advice
of counsel as set forth in Section 20 hereof. 

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

          (a) Any entity into which the Rights Agent or any successor Rights Agent may be merged or with
which it may be consolidated, or any entity resulting from any merger or consolidation to which the
Rights Agent or any successor Rights Agent shall be a party, or any entity succeeding to the
business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto; provided, however, that such entity 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 the 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

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countersigned, any successor Rights Agent may countersign such Rights Certificates either
in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.

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

     Section 20. Rights and Duties of Rights Agent. The Rights Agent undertakes to perform only the duties and obligations expressly imposed by
this Agreement (and no implied duties) upon the following terms and conditions, by all of which the
Company and the holders of 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
or an employee of the Rights Agent), and the advice or opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent and the Rights Agent shall incur no
liability for or in respect of any action taken, suffered or omitted by it and in accordance with
such advice or 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 Per Share Market Price) be proved or
established by the Company prior to taking, suffering or omitting to take any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein specifically prescribed)
may be deemed to be conclusively proved and established by a certificate signed by any one of the
Chairman of the Board, the Chief Executive Officer, the President, any Senior Vice President or
Vice President, the Chief Financial Officer, the Secretary or any Assistant Secretary of the
Company and delivered to the Rights Agent; and such certificate shall be full and complete
authorization and protection to the Rights Agent for any action taken, suffered or omitted to be
taken by it under the provisions of this Agreement in reliance upon such certificate. 

          (c) The Rights Agent shall be liable hereunder to the Company and any other Person only for
its own gross negligence, bad faith or willful misconduct (which gross negligence, bad faith or
willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling
of a court of competent jurisdiction). 

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

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          (e) The Rights Agent shall not have any liability for or be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof (except the due
execution hereof by the Rights Agent) or in respect of the validity or execution of any Rights
Certificate (except its countersignature thereof); nor shall it be responsible for any breach by
the Company of any covenant or condition contained in this Agreement or in any Rights Certificate;
nor shall it be responsible for any change in the exercisability of the Rights (including the
Rights becoming null and void pursuant to Section 7(e) hereof) or any change or adjustment in the
terms of the Rights (including the manner, method or amount thereof) provided for in
Sections 3, 11, 13, 23 or 24, or the ascertaining of the
existence of facts that would require any such change or adjustment (except with respect to the
exercise of Rights evidenced by Rights Certificates after receipt by the Rights Agent of a
certificate furnished pursuant to Section 12 describing such change or adjustment); nor
shall it by any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any Preferred Shares to be issued pursuant to this Agreement or any
Rights Certificate or as to whether any Preferred Shares will, when issued, be validly authorized
and issued, fully paid and nonassessable. 

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

          (g) The Rights Agent is hereby authorized and directed to accept instructions with respect to
the performance of its duties hereunder from any one of the Chairman of the Board, the Chief
Executive Officer, the President, any Senior Vice President or Vice President, the Chief Financial
Officer, the Secretary or any Assistant Secretary of the Company, and to apply to such officers for
advice or instructions in connection with its duties, and such instructions shall be full
authorization and protection to the Rights Agent and it shall not be liable for or in respect of
any action taken, suffered or omitted to be taken by it in accordance with instructions of any such
officer or for any delay in acting while waiting for those instructions. The Rights Agent shall be
fully authorized and protected in relying upon the most recent instructions received by any such
officer.  Any application by the Rights Agent for written instructions from the Company may, at the
option of the Rights Agent, set forth in writing any action proposed to be taken, suffered or
omitted by the Rights Agent under this Agreement and the date on and/or after which such action
shall be taken or such omission shall be effective. The Rights Agent shall not be liable for any
action taken or suffered by, or omission of, the Rights Agent in accordance with a proposal
included in any such application on or after the date specified in such application (which date
shall not be less than five (5) Business Days after the date on which any officer of the Company
actually receives such application, unless any such officer shall have consented in writing to an
earlier date) unless, prior to taking, suffering or omitting any such action (or the effective date
in the case of an omission), the Rights Agent shall have received written instructions in response
to such application specifying the action to be taken, suffered or omitted.

          (h) The Rights Agent and any shareholder, affiliate, director, officer or employee of the
Rights Agent may buy, sell or deal in any of the Rights or other securities of the Company or
become pecuniarily interested in any transaction in which the Company may be interested, or
contract with or lend money to the Company or otherwise act as fully and freely as though the
Rights

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Agent were not Rights Agent under this Agreement.  Nothing herein shall preclude the Rights
Agent or any such shareholder, affiliate, director, officer or employee from acting in any other
capacity for the Company or for any other Person.

          (i) The Rights Agent may execute and exercise any of the rights or powers hereby vested in it
or perform any duty hereunder either itself (through its directors, officers and employees) 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 or any other Person resulting from any such act, default, neglect or misconduct, absent
gross negligence or bad faith in the selection and continued employment thereof (which gross
negligence or bad faith must be determined by a final, non-appealable order, judgment, decree or
ruling of a court of competent jurisdiction). 

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

          (k) If, with respect to any Rights Certificate surrendered to the Rights Agent for exercise or
transfer, the certificate attached to the form of assignment or form of election to purchase, as
the case may be, has not been completed, the Rights Agent will deem the beneficial owner of the
rights evidenced by such Rights Certificate to be an Acquiring Person or an Affiliate or Associate
thereof and such assignment or election to purchase will not be honored. 

     Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties
under this Agreement upon thirty (30) days’ notice in writing mailed to the Company and to each
transfer agent of the Preferred Shares and the Common Shares known to the Rights Agent by
registered or certified mail, and to the holders of the Rights Certificates by first-class mail.
The Company may remove the Rights Agent or any successor Rights Agent upon thirty (30) days’ notice
in writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Preferred Shares and the Common Shares by registered or certified mail, and
to the holders of the Rights Certificates by first-class mail. If the Rights Agent shall resign or
be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent. If the Company shall fail to make such appointment within a period of thirty
(30) days after giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a
Rights Certificate (who shall, with such notice, submit such holder’s Rights Certificate for
inspection by the Company), then the registered holder of any Rights Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as
if it had been
originally named as Rights Agent without further act or deed; but the predecessor Rights Agent
shall deliver and transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of the Preferred
Shares and the Common Shares, and mail a notice thereof in writing to the

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registered holders of the
Rights Certificates. Failure to give any notice provided for in this Section 21, however,
or any defect therein, shall not affect the legality or validity of the resignation or removal of
the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

     Section 22. Issuance of New Rights Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary,
the Company may, at its option, issue new Rights Certificates evidencing Rights in such form as may
be approved by the Board to reflect any adjustment or change in the Exercise 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
redemption or expiration of the Rights, 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
or upon the exercise, conversion or exchange of other securities of the Company outstanding at the
date hereof 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, issue
Rights Certificates representing the appropriate number of Rights in connection with such issuance
or sale; provided, however, that (i) no such Rights Certificate shall be issued and
this sentence shall be null and void ab initio if, and to the extent that, such issuance or
this sentence would create a significant risk of or result in material adverse tax consequences to
the Company or the Person to whom such Rights Certificate would be issued or would create a
significant risk of or result in such options’ or employee plans’ or arrangements’ failing to
qualify for otherwise available special tax treatment and (ii) no such Rights Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of
the issuance thereof.

     Section 23. Redemption. 

          (a) The Company may, at its option and with the approval of the Board, at any time prior to
the Close of Business on the earlier of (i) the fifth (5th) day following the Shares
Acquisition Date (or such later date as may be determined by action of the Board and publicly
announced by the Company) and (ii) the Final Expiration Date, redeem all but not less than all the
then outstanding Rights at a redemption price of $0.001 per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being herein referred to as the “Redemption Price”) and the Company may, at
its option, pay the Redemption Price either in Common Shares (based on the Current Per Share Market
Price thereof at the time of redemption) or cash. Such redemption of the Rights by the Company may
be made effective at such time, on such basis and with such conditions as the Board in its sole
discretion may establish. The date on which the Board elects to make the redemption effective
shall be referred to as the “Redemption Date.”

          (b) Immediately upon the action of the Board ordering the redemption of the Rights and without
any further action and without any notice, the right to exercise the Rights will terminate and the
only right thereafter of the holders of Rights shall be to receive the Redemption Price.  The
Company shall promptly give public notice of any such redemption (with prompt written notice
thereof to the Rights Agent); provided, however, that the failure to give, or any
defect in, any

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such notice shall not affect the validity of such redemption. Within ten (10) days
after the action of the Board ordering the redemption of the Rights, the Company shall give notice
of such redemption to the Rights Agent and the holders of the then outstanding Rights by mailing
such notice to all such holders at their last addresses as they appear upon the registry books of
the Rights Agent or, prior to the Distribution Date, on the registry books of the transfer agent
for the Common Shares. Any notice which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each such notice of redemption will state
the method by which the payment of the Redemption Price will be made. Neither the Company nor any
of its Affiliates or Associates may redeem, acquire or purchase for value any Rights at any time in
any manner other than that specifically set forth in this Section 23 or in
Section 24 hereof, and other than in connection with the purchase of Common Shares prior to
the Distribution Date.

     Section 24. Exchange. 

          (a) Subject to applicable laws, rules and regulations, and subject to Section 24(c)
below, the Company may, at its option, by action of the Board, at any time after the occurrence of
a Triggering Event, exchange all or part of the then outstanding and exercisable Rights (which
shall not include Rights that have become void pursuant to the provisions of Section 7(e)
hereof) for 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”). 
Notwithstanding the foregoing, the Board shall not be empowered to effect such exchange at any time
after any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan
of the Company or any such Subsidiary, or any entity holding Common Shares for or pursuant to the
terms of any such plan), together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Common Shares then outstanding.

          (b) Immediately upon the action of the Board ordering the exchange of any Rights pursuant to
Section 24(a) and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to
receive that number of Common Shares equal to the number of such Rights held by such holder
multiplied by the Exchange Ratio.  The Company shall give public notice of any such exchange (with
prompt written notice thereof to the Rights Agent); provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of such exchange. The
Company shall mail a notice of any such exchange to all of the holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which the exchange of the Common Shares for
Rights will be effected and, in the event of any partial exchange, the number of Rights which will
be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other
than Rights which have become void pursuant to the provisions of Section 7(e) hereof) held
by each holder of Rights.

          (c) In the event that there shall not be sufficient Common Shares issued but not outstanding
or authorized but unissued to permit any exchange of Rights as contemplated in accordance with
Section 24(a), the Company shall either take such action as may be necessary to authorize
additional Common Shares for issuance upon exchange of the Rights or alternatively, at

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the option
of a majority of the Board, with respect to each Right (i) pay cash in an amount equal to the
Current Value (as hereinafter defined), in lieu of issuing Common Shares in exchange therefor, or
(ii) issue debt or equity securities or a combination thereof, having a value equal to the Current
Value, in lieu of issuing Common Shares in exchange for each such Right, where the value of such
securities shall be determined by a nationally recognized investment banking firm selected by
majority vote of the Board, or (iii) deliver any combination of cash, property, Common Shares
and/or other securities having a value equal to the Current Value in exchange for each Right.  For
purposes of this Section 24(c) only, the Current Value shall mean the product of the
Current Per Share Market Price of Common Shares on the date of the occurrence of the event
described above in Section 24(a), multiplied by the number of Common Shares for which the
Right otherwise would be exchangeable if there were sufficient shares available. To the extent
that the Company determines that some action need be taken pursuant to clauses (i),
(ii) or (iii) of this Section 24(c), the Board may temporarily suspend the
exercisability of the Rights for a period of up to sixty (60) days following the date on which the
event described in Section 24(a) shall have occurred, in order to seek any authorization of
additional Common Shares and/or to decide the appropriate form of distribution to be made pursuant
to the above provision 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.

          (d) The Company shall not be required to issue fractions of Common Shares or to distribute
certificates which evidence fractional Common Shares.  In lieu of such fractional Common Shares,
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 (as determined pursuant to the second sentence
of Section 1(k) hereof).

          (e) The Company may, at its option, by majority vote of the Board, at any time before any
Person has become an Acquiring Person, exchange all or part of the then outstanding Rights for
rights of substantially equivalent value, as determined reasonably and with good faith by the Board
based upon the advice of one or more nationally recognized investment banking firms. 

          (f) Immediately upon the action of the Board ordering the exchange of any Rights pursuant to
Section 24(e) and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to
receive that number of rights in exchange therefor as has been determined by the Board in
accordance with Section 24(e) above.  The Company shall give public notice of any such
exchange; provided, however, that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange. The Company shall mail a notice of any such
exchange to all of the holders of such Rights at their last addresses as they appear upon the
registry books of the transfer agent for the Common Shares of the Company. Any notice which is
mailed in the manner herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the exchange of the Rights
will be effected.

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     Section 25. Notice of Certain Events. 

          (a) In case the Company shall propose to effect or permit to occur any Triggering Event or
Section 13 Event, the Company shall give notice thereof to the Rights Agent and each holder of
Rights in accordance with Section 26 hereof at least twenty (20) days prior to occurrence
of such Triggering Event or such Section 13 Event. 

          (b) In case any Triggering Event or Section 13 Event shall occur, then, in any such case, the
Company shall as soon as practicable thereafter give the Rights Agent and to each holder of a
Rights Certificate, in accordance with Section 26 hereof, a notice of the occurrence of
such event, which shall specify the event and the consequences of the event to holders of Rights
under Section 11(a)(ii) and Section 13 hereof. 

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

RealNetworks, Inc.

2601 Elliott Avenue, Suite 1000

Seattle, WA 98121-3307

Attention: General Counsel

with a copy to:

Wilson Sonsini Goodrich & Rosati

Professional Corporation

701 Fifth Avenue, Suite 5100

Seattle, WA 98104

Attention: Patrick J. Schultheis

     Subject to the provisions of Section 21 hereof, any notice or demand authorized by
this Agreement to be given or made (i) by the Company to the Rights Agent shall be sufficiently
given or made if sent by facsimile transmission (provided confirmation of receipt is received
immediately thereafter) or by first-class mail, postage prepaid, addressed (until another address
is filed in writing with the Company), in each case, to the address or email address set forth
below and (ii) by the holder of any Rights Certificate to the Rights Agent shall be sufficiently
given or made if sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) to the address set forth below.

BNY Mellon Shareowner Services

520 Pike Street, Suite 1220

Seattle, WA 98101

Attention: Thomas Cooper

Facsimile: (206) 674-3059

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with a copy to:

BNY Mellon Shareowner Services

Newport Office Center VII

480 Washington Blvd., 29th Floor

Jersey City, NJ 07310

Attention: General Counsel

Facsimile: (201) 680-4610

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

     Section 27. Supplements and Amendments.  Prior to the occurrence of a Distribution Date, the Company may supplement or amend this
Agreement in any respect without the approval of any holders of Rights and the Rights Agent shall,
if the Company so directs, execute such supplement or amendment. From and after the occurrence of
a Distribution Date, the Company and the Rights Agent may from time to time supplement or amend
this Agreement without the approval of any holders of Rights in order to (i) cure any ambiguity,
(ii) correct or supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein, (iii) shorten or lengthen any time period hereunder or (iv) to
change or supplement the provisions hereunder in any manner that the Company may deem necessary or
desirable and that shall not adversely affect the interests of the holders of Rights (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring Person); provided, this
Agreement may not be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed at such time as the Rights
are not then redeemable or (B) any other time period unless such lengthening is for the purpose of
protecting, enhancing or clarifying the rights of, and/or the benefits to, the holders of Rights
(other than an Acquiring Person or an Affiliate or Associate of an Acquiring Person). 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, the Rights
Agent shall execute such supplement or amendment. Prior to the Distribution Date, the interests of
the holders of Rights shall be deemed coincident with the interests of the holders of Common
Shares. Notwithstanding anything contained in this Agreement to the contrary, the Rights Agent
may, but shall not be obligated to, enter into any supplement or amendment with the Company that
affects the Rights Agent’s own rights, duties, obligations or immunities under this Agreement.

     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, etc.  For all purposes of this Agreement, any calculation of the number of Common Shares
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

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Rule 13d-3(d)(1)(i) of the General Rules and Regulations under
the Exchange Act. The Board shall have the exclusive power and authority to administer this
Agreement and to exercise all rights and powers specifically granted to the Board, or the Company,
or as may be necessary or advisable in the administration of this Agreement, including, without
limitation, the right and power (i) to interpret the provisions of this Agreement and (ii) to make
all determinations deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or not redeem the Rights or to amend the Agreement). All such
actions, calculations, interpretations and determinations (including, for purposes of clause (y)
below, all omissions with respect to the foregoing) which are done or made by the Board in good
faith, shall (x) be final, conclusive and binding on the Company, the Rights Agent, the holders of
the Rights Certificates and all other parties and (y) with respect to claims specifically arising
from the Agreement, not subject the Board to any liability to the holders of the Rights. The
Rights Agent is entitled to always assume the Company’s Board acted in good faith and shall be
fully protected and incur no liability in reliance thereon.

     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, the Common Shares) any legal or equitable right, remedy or claim pursuant to
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, 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 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 tenth day following the date of such determination by the Board.

     Section 32. Governing Law.  This Agreement and each Right and each Rights Certificate issued hereunder shall be deemed
to be a contract made under the laws of the State of Washington and for all purposes shall be
governed by and construed in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State; provided, however, that the
rights, duties and obligations of the Rights Agent shall be governed by the laws of the State of
New York, without regard to the principles or rules concerning conflicts of laws which might
otherwise require application of the substantive laws of another jurisdiction.

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

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     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.

[Remainder of page intentionally left blank.]

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

	 	 	 	 	 	 	 	 	 
	“COMPANY”	 	 	 	REALNETWORKS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Robert Glaser 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Name:	 	Robert Glaser	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Chairman and CEO	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 
	“RIGHTS AGENT”	 	 	 	MELLON INVESTOR SERVICES LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Thomas L. Cooper	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Thomas L. Cooper	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	 	Title:	 	Assistant Vice President	 	 
	 

	 	 	 	 	 	 	 	 

-39-

 

EXHIBIT A

REALNETWORKS, INC.

DESIGNATION OF RIGHTS AND PREFERENCES OF

SERIES A PREFERRED STOCK

     Pursuant to the authority granted to and vested in the Board of Directors of RealNetworks,
Inc., a Washington corporation (the “Corporation”), in accordance with the provisions of the
Corporation’s Restated Articles of Incorporation, the Board of Directors hereby establishes a
series of the Corporation’s Preferred Stock, par value $0.001, consisting of 200,000 shares
designated Series A Preferred Stock, and hereby states the designation and number of shares, and
fixes the relative rights, preferences and limitations thereof (in addition to the provisions in
the Restated Articles of Incorporation which are applicable to the Preferred Stock of all classes
and series) as follows:

     Section 1. Designation and Amount. Two Hundred Thousand (200,000) shares shall be
designated herein as the “Series A Preferred Stock.” The Series A Preferred Stock shall have a par
value of $0.001 per share.

     Section 2. Proportional Adjustment. In the event the Corporation shall at any time
after the issuance of any share or shares of Series A Preferred Stock (i) declare any dividend on
Common Stock of the Corporation (“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 Corporation shall simultaneously effect a proportional
adjustment to the number of outstanding shares of Series A Preferred Stock, if any.

     Section 3. Dividends and Distributions.

          (a) Subject to the prior and superior right of the holders of any shares of any series of
Preferred Stock ranking prior and superior to the shares of Series A Preferred Stock with respect
to dividends, the holders of shares of Series A Preferred Stock shall be entitled to receive when,
as and if declared by the Board of Directors out of funds legally available for that purpose,
quarterly dividends payable in cash on the last day of January, April, July and October in each
year (each such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing
on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a
share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to
1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per
share amount (payable in kind) of all non-cash dividends or other distributions other (except as
provided in Section 2 hereof) 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 A Preferred Stock.

 

 

          (b) The Corporation shall declare a dividend or distribution on the Series A Preferred Stock
as provided in paragraph (a) above immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable solely in shares of Common Stock).

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

     Section 4. Voting Rights. The holders of shares of Series A Preferred Stock shall
have the following voting rights:

          (a) Each share of Series A Preferred Stock shall entitle the holder thereof to 1,000 votes on
all matters submitted to a vote of the shareholders of the Corporation.

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

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

     Section 5. Certain Restrictions.

          (a) The Corporation shall not declare any dividend on, make any distribution on, or redeem or
purchase or otherwise acquire for consideration any shares of Common Stock after the first issuance
of a share or fraction of a share of Series A Preferred Stock unless concurrently therewith it
shall declare a dividend on the Series A Preferred Stock as required by Section 3 hereof.

          (b) Whenever quarterly dividends or other dividends or distributions payable on the Series A
Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued

-2-

 

and
unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:

               (i) declare or pay dividends on, make any other distributions on, or redeem or purchase or
otherwise acquire for consideration any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Preferred Stock;

               (ii) declare or pay dividends on, 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 Series A
Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity
stock on which dividends are payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;

               (iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking on
a parity (either as to dividends or rights upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity 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 A Preferred Stock; and

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

          (c) 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 paragraph (a) of this Section 5, purchase or otherwise acquire such shares at such
time and in such manner.

     Section 6. Reacquired Shares. Any shares of Series A Preferred Stock purchased or
otherwise acquired by the Corporation in any manner whatsoever shall be retired and canceled
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 and, in the Restated Certificate of
Incorporation, as then amended.

     Section 7. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution
or winding up of the Corporation, the holders of shares of Series A Preferred Stock shall be
entitled to receive an aggregate amount per share equal to 1,000 times the aggregate amount to be
distributed

-3-

 

per share to holders of shares of Common Stock plus an amount equal to any accrued and
unpaid dividends on such shares of Series A Preferred Stock.

     Section 8. 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 and/or any other property, then
in any such case the shares of Series A Preferred Stock shall at the same time be similarly
exchanged or changed in an amount per share equal to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may be, into which or for
which each share of Common Stock is changed or exchanged.

     Section 9. No Redemption. The shares of Series A Preferred Stock shall not be
redeemable.

     Section 10. Ranking. The Series A 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 or as otherwise may be required
by applicable law.

     Section 11. Amendment. The Restated Certificate of Incorporation of the Corporation
shall not be further amended in any manner which would materially alter or change the powers,
preference or special rights of the Series A Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority of the outstanding shares of Series A Preferred
Stock, voting separately as a class.

     Section 12. Fractional Shares. Series A Preferred Stock may be issued in fractions of
a share which 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 A Preferred Stock.

-4-

 

EXHIBIT B

FORM OF RIGHTS CERTIFICATE

			
	 	 	 
	Certificate No. R-
	 	                     Rights

NOT EXERCISABLE AFTER THE EARLIER OF (i) DECEMBER 2, 2018, (ii) THE DATE TERMINATED
BY THE COMPANY OR (iii) THE DATE THE COMPANY EXCHANGES THE RIGHTS PURSUANT TO THE
RIGHTS AGREEMENT. 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, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID.
[THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED
BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY,
THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID
IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH RIGHTS AGREEMENT.]*

RIGHTS CERTIFICATE

REALNETWORKS, 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 Amended and Restated Shareholder Rights Plan dated as
of December 2, 2008, (as may be amended, supplemented or modified from time to time, the “Rights
Agreement”), between RealNetworks, Inc., a Washington corporation (the “Company”) and Mellon
Investor Services LLC, a New Jersey limited liability company (the “Rights Agent”), to purchase
from the Company at any time after the Distribution Date (as such term is defined in the Rights
Agreement) and prior to 5:00 P.M., Seattle, Washington time, on December 2, 2018, at the office of
the Rights Agent designated for such purpose, or at the office of

 

			
	*	 	The portion of the legend in bracket shall be inserted only if
applicable and shall replace the preceding sentence.

 

 

its successor as Rights Agent, one one-thousandth (0.001) of a fully paid and non-assessable
share of Series A Preferred Stock, par value $0.001 per share (the “Preferred Shares”), of the
Company, at an exercise price of $30.00 per one-thousandth (0.001) of a Preferred Share (the
“Exercise 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 one-thousandths (0.001) of a Preferred Share which may be
purchased upon exercise hereof) set forth above are the number and Exercise Price as of [  ] based on the Preferred Shares as constituted at such date. As provided in the
Rights Agreement, the Exercise Price and the number and kind of Preferred Shares or other
securities which may be purchased upon the exercise of the Rights evidenced by this Rights
Certificate are subject to modification and adjustment upon the happening of certain events.

     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
principal executive offices of the Company and the above-mentioned office of the Rights Agent.

     Subject to the provisions of the Rights Agreement, the Rights evidenced by this Rights
Certificate (i) may be redeemed by the Company, at its option, at a redemption price of $0.001 per
Right or (ii) may be exchanged by the Company in whole or in part for Common Shares, substantially
equivalent rights or other consideration as determined by the Company.

     This Rights Certificate, with or without other Rights Certificates, upon surrender at the
office 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 amount of securities 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.

     No fractional portion of less than one one-thousandth (0.001) of a Preferred Share will be
issued upon the exercise of any Right or Rights evidenced hereby but in lieu thereof a cash payment
will be made, as provided in the Rights Agreement.

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

-2-

 

the Right or Rights evidenced by this Rights Certificate shall have been exercised as provided
in the Rights Agreement.

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

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

	 	 	 	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	REALNETWORKS, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 	 	 	 	 	 	 	 	 
	[                                        ]	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Countersigned:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	MELLON INVESTOR SERVICES LLC,	 	 	 	 	 	 	 	 
	as Rights Agent	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Its:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 

-3-

 

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)

 

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

Dated:                                         ,                     

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Signature Guaranteed:

     Signatures must be guaranteed by a participant in the Securities Transfer Agent Medallion Program,
the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion Signature
Program.

 

 

CERTIFICATE

     The undersigned hereby certifies by checking the appropriate boxes that:

          (1) this Rights Certificate [ ] is [ ] is 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
Person (as such terms are defined in the Rights Agreement);

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

Dated:                                         ,                     

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Signature Guaranteed:

     Signatures must be guaranteed by a participant in the Securities Transfer Agent Medallion Program,
the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion Signature
Program.

 

 

Form of Reverse Side of Rights Certificate — continued

FORM OF ELECTION TO PURCHASE

(To be executed if holder desires to

exercise the Rights Certificate)

To: REALNETWORKS, INC.

          The undersigned hereby irrevocably elects to exercise                                          Rights
represented by this Rights Certificate to purchase the number of one-thousandths (0.001) of a
Preferred Share issuable upon the exercise of such Rights and requests that certificates for such
number of one-thousandths (0.001) of a Preferred Share issued in the name of:

Please insert social security

or other identifying number

 

(Please print name and address)

 

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

Please insert social security

or other identifying number

 

(Please print name and address)

 

Dated:                                         ,                     

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Signature Guaranteed:

     Signatures must be guaranteed by a participant in the Securities Transfer Agent Medallion Program,
the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion Signature
Program.

 

 

CERTIFICATE

          The undersigned hereby certifies by checking the appropriate boxes that:

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

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

Dated:                                         ,                     

	 	 	 	 	 
	 

	 	 

Signature
	 	 

Signature Guaranteed:

          Signatures must be guaranteed by a participant in the Securities Transfer Agent Medallion
Program, the Stock Exchanges Medallion Program or the New York Stock Exchange, Inc. Medallion
Signature Program.

Certificate:

          The undersigned hereby certifies that the Rights evidenced by this Rights Certificate are not
beneficially owned by, or being assigned to, an Acquiring Person or an Affiliate or Associate
thereof (as such terms are defined pursuant to the Rights Agreement).

 

 

Form of Reverse Side of Rights Certificate — continued

NOTICE

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

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

 

 

EXHIBIT C

AMENDED AND RESTATED

SHAREHOLDER RIGHTS PLAN

REALNETWORKS, INC.

Summary of Rights

     On December 4, 1998, RealNetworks, Inc., (the “Company”) and ChaseMellon Shareholder Services,
L.L.C. entered into a Shareholder Rights Plan (such Shareholder Rights Plan, as previously amended,
the “Original Rights Agreement”). In connection with the Original Rights Agreement, the Board of
Director of the Company authorized and declared a dividend of one preferred share purchase right (a
“Right”) for each share of common stock, par value $0.001 (the “Common Shares”) of the Company
outstanding as of the close of business on December 14, 1998 (the “Record Date”). Each Right
represented the right to purchase one one-thousandth (0.001) of a share of Series A Preferred
Stock, subject to the terms and conditions set forth in the Original Rights Agreement. On December
2, 2008, the Company amended and restated the Original Rights Agreement by entering into the
Amended and Restated Shareholder Rights Plan (the “Rights Agreement”) between the Company and
Mellon Investor Services LLC. The Rights Agreement extends the term of the Rights and makes
certain other changes to the Rights and the Original Rights Agreement as more fully set forth in
the Rights Agreement.

	 	 	 
	Distribution and Transfer of
Rights; Rights Certificate:

	 	Prior to the Distribution Date referred to below, the Rights will be
evidenced by and trade with the certificates for the shares of Common
Stock. After the Distribution Date, the Company will mail Rights
certificates to the Company’s shareholders and the Rights will become
transferable apart from the shares of Common Stock.
	 
	 	 
	Distribution Date:

	 	Rights will separate from the Common Stock and become exercisable
following (a) the tenth business day (or such later date as may be
determined by the Company’s Board of Directors) after a person or group
acquires beneficial ownership of 15% or more of the Company’s Common Stock
or (b) the tenth business day (or such later date as may be determined by
the Company’s Board of Directors) after a person or group announces a
tender or exchange offer, the consummation of which would result in
ownership by a person or group of 15% or more of the Company’s Common
Stock.
	 
	 	 
	Preferred Stock Purchasable
Upon Exercise of Rights:

	 	After the Distribution Date, each Right will entitle the holder to
purchase for $30.00 (the “Exercise Price”), a fraction of a share of the
Company’s Preferred Stock with economic terms similar to that of one share
of the Company’s Common Stock.
	 
	 	 
	Flip-In:

	 	If an acquirer (an “Acquiring Person”) obtains 15% or more of the
Company’s Common Stock, then each Right (other than Rights owned by an
Acquiring Person or its affiliates) will entitle the holder thereof to
purchase, for the Exercise Price, a number of shares of the Company’s
Common Stock having a then-current market value of twice the Exercise
Price.
	 
	 	 
	Flip-Over:

	 	If, after an Acquiring Person obtains 15% or more of the Company’s Common
Stock, (a) the Company merges into another entity, (b) an acquiring entity
merges into the Company or (c) the Company sells more than 50% of the
Company’s assets or earning power, then each Right (other than Rights
owned by an Acquiring Person or its affiliates) will entitle the holder
thereof to purchase, for the Exercise Price, a number of shares of Common
Stock of the person engaging in the transaction having a then current
market value of twice the Exercise Price.

 

 

	 	 	 
	Exchange Provision:

	 	At any time after the date on which an Acquiring Person obtains 15% or
more of the Company’s Common Stock and prior to the acquisition by the
Acquiring Person of 50% of the outstanding Common Stock, the Board of
Directors of the Company may exchange the Rights (other than Rights owned
by the Acquiring Person or its affiliates), in whole or in part, for
shares of Common Stock of the Company at an exchange ratio of one share of
Common Stock per Right (subject to adjustment).
	 
	 	 
	Redemption of the Rights:

	 	Rights will be redeemable at the Company’s option for $0.001 per Right at
any time on or prior to the fifth day (or such later date as may be
determined by the Company’s Board of Directors) after public announcement
that a Person has acquired beneficial ownership of 15% or more of the
Company’s Common Stock (the “Shares Acquisition Date”).
	 
	 	 
	Expiration of the Rights:

	 	The Rights expire on the earliest of (a) December 2, 2018 or (b) exchange
or redemption of the Rights as described above.
	 
	 	 
	Amendment of Terms of Rights:

	 	The terms of the Rights and the Rights Agreement may be amended in any
respect without the consent of the Rights holders on or prior to the
Distribution Date; thereafter, the terms of the Rights and the Rights
Agreement may be amended without the consent of the Rights holders in
order to cure any ambiguities or to make changes which do not adversely
affect the interests of Rights holders (other than the Acquiring Person).
	 
	 	 
	Voting Rights:

	 	Rights will not have any voting rights.
	 
	 	 
	Anti-Dilution Provisions:

	 	Rights will have the benefit of certain customary anti-dilution provisions.
	 
	 	 
	Taxes:

	 	The Rights distribution should not be taxable for federal income tax
purposes. However, following an event which renders the Rights
exercisable or upon redemption of the Rights, shareholders may recognize
taxable income.

The foregoing is a summary of certain principal terms of the Amended and Restated Shareholder
Rights Plan only and not intended to be complete. The summary is qualified in its entirety by
reference to the Rights Agreement, which is incorporated herein by reference. The Rights Agreement
may be amended from time to time. A copy of the Rights Agreement was filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A/A dated December 2, 2008.
A copy of the Rights Agreement is available free of charge from the Company.

-2-exv4w1

Exhibit 4.1

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD
OR TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE AND CURRENT REGISTRATION STATEMENT OR POST-EFFECTIVE
AMENDMENT THERETO FOR SUCH SHARES UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY AN
OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS
NOT REQUIRED UNDER THE ACT. THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY SUCH SECURITIES.

			
	 	 	 
	Warrant No. ___
	 	Date of Issuance: ___, 2008
	 	 	 
	 
	 	Number of Shares: ___

(subject to adjustment)

VIRNETX HOLDING CORPORATION

COMMON STOCK PURCHASE WARRANT

     VirnetX Holding Corporation, a Delaware corporation (the “Company”), for value
received, hereby certifies that ___, or its registered assigns (the
“Registered Holder”), is entitled, subject to the terms set forth below, to purchase from
the Company, at any time after the date hereof and on or before ___, 2013 (the
“Expiration Date”) shares of the Company’s Common Stock (the “Common Stock”) at a
per share purchase price equal to ___dollars ($___) (the “Purchase Price”), as adjusted
from time to time pursuant to the provisions of this Warrant. The shares purchasable upon exercise
of this Warrant, as adjusted from time to time pursuant to the provisions of this Warrant, are
hereinafter referred to as the “Warrant Stock”.

     This Warrant is issued pursuant to, and is subject to the terms and conditions of:

     1. Number of Shares. Subject to the terms and conditions hereinafter set forth, the
Registered Holder is entitled, upon surrender of this Warrant, to purchase from the Company the
number of shares (subject to adjustment as provided herein) of Warrant Stock first set forth above.

     2. Exercise.

          (a) Manner of Exercise. This Warrant may be exercised by the Registered Holder, in
whole or in part, by surrendering this Warrant, with the purchase/exercise form appended hereto as
Exhibit A duly executed by such Registered Holder or by such Registered Holder’s duly
authorized attorney, at the principal office of the Company, or at such other office or agency as
the Company may designate, accompanied by payment in full of the Purchase Price payable in respect
of the number of shares of Warrant Stock purchased upon such exercise. The Purchase Price may be
paid by cash, check, wire transfer or pursuant to the cashless exercise provisions of Section 2(b).

          (b) Cashless Exercise. Notwithstanding anything contained herein to the contrary, if
an effective registration statement covering the Warrant Stock that is the subject of the Exercise
Notice

 

 

is not available for the resale of such
Warrant Stock (the “Unavailable Warrant Shares”), the Holder may, in its sole discretion, exercise this Warrant in whole or in part
and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such
exercise in payment of the Purchase Price, elect instead to receive upon such exercise
the “Net Number” of shares of Common Stock determined according to the following formula (a
“Cashless Exercise”):

	 	 	 
	Net Number =

	 	(A x B) — (A x C)
	 

	 	             B

               For purposes of the foregoing formula:

          A= the total number of shares with respect to which this Warrant is then being exercised.

          B= the closing sale price of the shares of Common Stock on the date immediately preceding the
date of the Exercise Notice.

          C= the Purchase Price then in effect for the applicable Warrant Stock at the time of such
exercise.

          (c) Effective Time of Exercise. Each exercise of this Warrant shall be deemed to have
been effected immediately prior to the close of business on the day on which this Warrant shall
have been surrendered to the Company as provided in Section 2(a). At such time, the person or
persons in whose name or names any certificates for Warrant Stock shall be issuable upon such
exercise as provided in Section 2(d) shall be deemed to have become the holder or holders of record
of the Warrant Stock represented by such certificates.

          (d) Delivery to Holder. As soon as practicable after the exercise of this Warrant in
whole or in part, and in any event. Within ten (10) days thereafter, the Company at its expense will
cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct:

               (i) a certificate or certificates, or book-entry position, for the number of shares of Warrant
Stock to which such Registered Holder shall be entitled, and

               (ii) in case such exercise is in part only, a new warrant or warrants (dated the date hereof)
of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of
Warrant Stock equal (without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the number of such shares purchased by the Registered
Holder upon such exercise as provided in Section 2(a).

          (e) Company’s
Failure to Timely Deliver Securities. If the Company shall
fail to issue to the Registered Holder, within three (3) business days of the exercise as provided in Section 2(a), a certificate for the number of shares of Common Stock to which the Registered Holder is entitled
and register such shares of Common Stock on the Company’s share register or to credit the Registered Holder’s
balance account with DTC for such number of shares of Common Stock to which the Registered Holder is entitled
upon the Registered Holder’s exercise of this Warrant or if the Company fails to deliver to the Registered Holder a
certificate or certificates representing the applicable Warrant Stock
within three (3) business days  after its obligation to do so under clause (ii) below, and if on or after such business day the
Registered Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Registered Holder of shares of Common Stock issuable upon such exercise or
receipt that the Registered Holder anticipated receiving

-2-

 

from the
Company (a “Buy-In”), then the Company shall, within
three (3) business days
after the Registered Holder’s request and in the Registered Holder’s discretion, either (i) pay cash to the Registered Holder in an
amount equal to the Registered Holder’s total purchase price (including brokerage commissions, if any) for the
shares of Common Stock so purchased (the “Buy-In Price”), at which point the Company’s
obligation to deliver such certificate (and to issue such Warrant
Stock) shall terminate, or (ii)
promptly honor its obligation to deliver to the Registered Holder a certificate or certificates representing
such Warrant Stock and pay cash to the Registered Holder in an amount equal to the excess (if any) of the
Buy-In Price over the product of (A) such number of shares of
Common Stock, times (B) the closing bid price of the Company’s
common stock on the date of exercise.

     3. Adjustments.

          (a) Stock Splits and Dividends. If outstanding shares of the Company’s Common Stock
shall be subdivided into a greater number of shares or a dividend in Common Stock shall be paid in
respect of Common Stock, the Purchase Price in effect immediately prior to such subdivision or at
the record date of such dividend shall simultaneously with the effectiveness of such subdivision or
immediately after the record date of such dividend be proportionately reduced. If outstanding
shares of Common Stock shall be combined into a smaller number of shares, the Purchase Price in
effect immediately prior to such combination shall, simultaneously with the effectiveness of such
combination, be proportionately increased. When any adjustment is required to be made in the
Purchase Price, the number of shares of Warrant Stock purchasable upon the exercise of this Warrant
shall be changed to the number determined by dividing (i) an amount equal to the number of shares
issuable upon the exercise of this Warrant immediately prior to such adjustment, multiplied by the
Purchase Price in effect immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment.

          (b) Reclassification, Etc. In case there occurs any reclassification or change of the
outstanding securities of the Company or of any reorganization of the Company (or any other
corporation the stock or securities of which are at the time receivable upon the exercise of this
Warrant) or any similar corporate reorganization on or after the date hereof, then and in each such
case the Registered Holder, upon the exercise hereof at any time after the consummation of such
reclassification, change, or reorganization shall be entitled to receive, in lieu of the stock or
other securities and property receivable upon the exercise hereof prior to such consummation, the
stock or other securities or property to which such Holder would have been entitled upon such
consummation if such Holder had exercised this Warrant immediately prior thereto, all subject to
further adjustment pursuant to the provisions of this Section 3.

          (c) Adjustment Certificate. When any adjustment is required to be made in the Warrant
Stock or the Purchase Price pursuant to this Section 3, the Company shall promptly mail to the
Registered Holder a certificate setting forth (i) a brief statement of the facts requiring such
adjustment, (ii) the Purchase Price after such adjustment and (iii) the kind and amount of stock or
other securities or property into which this Warrant shall be exercisable after such adjustment.

          (d) Reorganizations, Mergers and Consolidations. 
If at any time or from time to time after the date hereof there is a reorganization of the Company
(other than a recapitalization, subdivision, combination, reclassification or exchange of shares
provided for elsewhere in this Section 3) or a merger or consolidation of the Company with or into
another corporation, then, as a part of such reorganization, merger or consolidation, provision
shall be made so that the Registered Holder of this Warrant thereafter shall be entitled to
receive, upon exercise of this Warrant, the number of shares of stock or other securities or
property of the Company, or of such successor corporation resulting from such reorganization,
merger or consolidation, to which a holder of Common Stock would have been entitled on such
reorganization, merger or consolidation. In any such case, appropriate adjustment shall be made in
the application of the provisions of this Section 3 with respect to the rights of the Registered
Holder of this Warrant after the reorganization, merger or consolidation to the end that the
provisions of this Section 3 (including adjustment of the Purchase Price then in effect and number
of shares issuable upon exercise of this Warrant, as applicable) shall be applicable after that
event and be as nearly equivalent to the provisions hereof as may be practicable. This Section 3(d)
shall similarly apply to successive reorganizations, mergers and consolidations. Notwithstanding
the foregoing, if any such reorganization, merger or consolidation constitutes or results in (a) a
“going private” transaction as defined in Rule 13e-3 under the Exchange Act, (b) an acquisition of
the Company primarily for cash, or (c) an acquisition, merger or sale with or into a Person not
traded on an Eligible Market (as defined below), then the Company (or any such successor or
surviving entity) shall require that the Registered Holder waive the above requirements of this
Section 3(d) in exchange for a payment of cash on the closing date of such reorganization, merger
or consolidation, equal to the Black Scholes Value of the remaining unexercised portion of this
Warrant on the closing date of such reorganization, merger or consolidation, provided that the per
share consideration to be received by the holders of shares of Common Stock upon the consummation
of such reorganization, merger or consolidation is less than the Exercise Price. Concurrently with
such payment, this Warrant shall be cancelled. “Black Scholes Value” means the value of
this Warrant based on the Black and Scholes Option Pricing Model obtained from the “OV” function on
Bloomberg determined as of the day immediately following the public announcement of the applicable
reorganization, merger or consolidation and reflecting (i) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of such date
and (ii) an expected volatility equal to the ___ – day volatility obtained from the HVT function on
Bloomberg. “Eligible Market” means the American Stock Exchange, The New York Stock
Exchange, Inc., The Nasdaq Capital Market, The NASDAQ Global Market or The NASDAQ Global Select
Market.

-3-

 

          (e) Pro
Rata Rights Upon Distributions of Assets. If the Company shall declare or make
any dividend or other distribution of its assets (or rights to acquire its assets) to holders of
shares of Common Stock (which dividend or other distribution has not already been given to the
Registered Holders of the Warrants), including, without limitation, any distribution of cash,
equity or debt securities or rights or warrants to subscribe for or purchase any equity or debt
security, or other property or assets at any time after the issuance of this Warrant and prior to
the Expiration Date, then, in each such case (in each case, “Distributed Property”), the Registered
Holder shall be entitled upon exercise of this Warrant for the purchase of any or all of the
Warrant Stock, to receive the amount of Distributed Property which would have been payable to the
Registered Holder had such Registered Holder been the holder of such Warrant Stock on the record
date for the determination of shareholders entitled to such Distributed Property. The Company will
at all times set aside and keep available for distribution to such holder upon exercise of this
Warrant a portion of the Distributed Property to satisfy the distribution to which such Registered
Holder is entitled pursuant to the preceding sentence.

     4. Transfers.

          (a) Registration Statement. Each holder of this Warrant acknowledges that this Warrant
and the Warrant Stock have been registered under the Securities Act of 1933, as amended (the
“Securities Act”), pursuant to a registration statement on Form S-1 which must be amended on a post-effective basis
from time to time in order to maintain its accuracy and keep it
up-to-date, and agrees not to sell, pledge, distribute, offer for sale, transfer or
otherwise dispose of this Warrant or any Warrant Stock issued upon its exercise in the absence of
(i) an effective registration statement under the Securities Act as to the sale of any such
securities and registration or qualification of such securities under any applicable U.S. federal
or state securities law then in effect, or (ii) an opinion of counsel, satisfactory to the Company,
that such registration and qualification are not required. Each certificate or other instrument
for Warrant Stock issued upon the exercise of this Warrant shall bear a legend substantially to the
foregoing effect and as described in Section 15.

          (b) Transferability. Prior to the Expiration Date and subject to compliance with any
applicable securities laws and the conditions set forth in this Section 4, this Warrant and all
rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the
principal office of the Company, together with a written assignment of this Warrant substantially
in the form attached hereto as Exhibit B duly executed by the Registered Holder or its
agent or attorney, and funds sufficient to pay any transfer taxes payable upon the making of such
transfer. The transferee shall also sign an investment letter in form and substance reasonably
satisfactory to the Company. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the
denomination or denominations specified in such instrument of assignment, and shall issue to the
assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for
the purchase of Warrant Stock without having a new Warrant issued.

          (c) Warrant Register. The Company will maintain a register containing the names and
addresses of the Registered Holders of this Warrant. Until any transfer of this Warrant is made in
the warrant register, the Company may treat the Registered Holder of this Warrant as the absolute
owner hereof for all purposes; provided, however, that if this Warrant is properly
assigned in blank, the Company may (but shall not be required to) treat the bearer hereof as the
absolute owner hereof for all purposes, notwithstanding any notice to the contrary. Any Registered
Holder may change such Registered Holder’s address as shown on the warrant register by written
notice to the Company requesting such change.

-4-

 

     5. No Impairment. The Company will not, by amendment of its charter or through
reorganization, consolidation, merger, dissolution, sale of assets or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will
(subject to Section 13) at all times in good faith assist in the carrying out of all such terms and
in the taking of all such action as may be necessary or appropriate in order to protect the rights
of the holder of this Warrant against impairment.

-5-

 

     6. Notices of Certain Transactions. In case:

          (a) the Company shall take a record of the holders of its Common Stock (or other stock or
securities at the time deliverable upon the exercise of this Warrant) for the purpose of entitling
or enabling them to receive any dividend or other distribution, or to receive any right to
subscribe for or purchase any shares of stock of any class or any other securities, or to receive
any other right, to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right, or

          (b) of any capital reorganization of the Company, any reclassification of the capital stock of
the Company, any consolidation or merger of the Company, any consolidation or merger of the Company
with or into another corporation (other than a consolidation or merger in which the Company is the
surviving entity), or any transfer of all or substantially all of the assets of the Company, or

          (c) of
the voluntary or involuntary dissolution, liquidation or winding-up
of the
Company,

then, and in each such case, the Company will mail or cause to be mailed to the Registered Holder
of this Warrant a notice specifying, as the case may be, (i) the date on which a record is to be
taken for the purpose of such dividend, distribution or right, and stating the amount and character
of such dividend, distribution or right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution, liquidation, winding-up, redemption
or conversion is to take place, and the time, if any is to be fixed, as of which the holders of
record of Common Stock (or such other stock or securities at the time deliverable upon such
reorganization, reclassification, consolidation, merger, transfer, dissolution, liquidation,
winding-up, redemption or conversion) are to be determined. Such notice shall be mailed at least
ten (10) days prior to the record date or effective date for the event specified in such notice.

     7. Limitations on Exercises; Beneficial Ownership. The Company shall not effect the
exercise of this Warrant, and the Registered Holder shall not have the right to exercise this Warrant, to the
extent that after giving effect to such exercise, such Registered Holder (together with such Registered Holder’s
affiliates, and any other Persons whose beneficial ownership of Common Stock would be aggregated
with such Registered Holder’s for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) would beneficially own in excess of 4.99% of the shares of Common
Stock outstanding immediately after giving effect to such exercise (the “Maximum
Percentage”). For purposes of the foregoing
sentence, the aggregate number of shares of Common Stock beneficially owned by such Registered Holder and its
affiliates shall include the number of shares of Common Stock issuable upon exercise of this
Warrant with respect to which the determination of such sentence is being made, but shall exclude
shares of Common Stock which would be issuable upon (i) exercise of the remaining, unexercised
portion of this Warrant beneficially owned by such Registered Holder and its affiliates and (ii) exercise or
conversion of the unexercised or unconverted portion of any other securities of the Company
beneficially owned by such Person and its affiliates (including, without limitation, any
convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion
or exercise analogous to the limitation contained herein. Except as set forth in the preceding
sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance
with Section 13(d) of the Exchange Act. For purposes of this Warrant, in determining the number of
outstanding shares of

-6-

 

Common
Stock, the Registered Holder may rely on the number of outstanding shares of Common Stock as
reflected in (1) the Company’s most recent Form 10-K, Form 10-Q, Current Report on Form 8-K or
other public filing with the Securities and Exchange Commission, as the case may be, (2) a more
recent public announcement by the Company or (3) any other
notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. For any reason at any time,
upon the written or oral request of the Registered Holder, the Company shall within two (2) Business Days
confirm orally and in writing to the Registered Holder the number of shares of Common Stock then outstanding.
In any case, the number of outstanding shares of Common Stock shall be determined after giving
effect to the conversion or exercise of securities of the Company, including the Warrants, by the
Registered Holder and its affiliates since the date as of which such number of outstanding shares of Common
Stock was reported. By written notice to the Company, the Registered Holder may from time to time increase or
decrease the Maximum Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the sixty-first (61st) day
after such notice is delivered to the Company, and (ii) any such increase or decrease will apply
only to the Registered Holder and not to any other holder of the Warrants.

     8. Reservation of Stock. The Company will at all times reserve and keep available,
solely for the issuance and delivery upon the exercise of this Warrant, such shares of Warrant
Stock and other stock, securities and property, as from time to time shall be issuable upon the
exercise of this Warrant.

     9. Fully Paid and Non-assessable. The Company covenants that all Warrant Stock
shall, upon issuance and the payment of the applicable Purchase Price in accordance with the terms
hereof, be duly and validly authorized, issued and fully paid and non-assessable.

     10. Exchange of Warrants. Upon the surrender by the Registered Holder of any Warrant
or Warrants, properly endorsed, to the Company at the principal office of the Company, the Company
will, subject to the provisions of Section 4, issue and deliver to or upon the order of such
Registered Holder, at the Company’s expense, a new Warrant or Warrants of like tenor, in the name
of such Registered Holder or as such Registered Holder (upon payment by such Registered Holder of
any applicable transfer taxes) may direct, calling in the aggregate on the face or faces thereof
for the number of shares of Warrant Stock called for on the face or faces of the Warrant or
Warrants so surrendered.

     11. Replacement of Warrants. Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and (in the case of loss,
theft or destruction) upon delivery of an indemnity agreement (with surety if reasonably required)
in an amount reasonably satisfactory to the Company, or (in the case of mutilation) upon surrender
and cancellation of this Warrant, the Company will issue, in lieu thereof, a new Warrant of like
tenor.

     12. Notices. Any notice required or permitted pursuant to this Warrant shall be in
writing and shall be deemed sufficient upon receipt, when delivered personally or by overnight
courier or sent by email or fax (upon customary confirmation of receipt), or forty-eight (48) hours
after being deposited in the regular mail, as certified or registered mail (airmail if sent
internationally), with postage prepaid, addressed (a) if to the Registered Holder, to the address
of the Registered Holder most recently furnished in writing to the Company and (b) if to the
Company, to the address set forth below or subsequently modified by written notice to the
Registered Holder.

     13. No Rights as Stockholder. Until the exercise of this Warrant, the Registered
Holder of this Warrant shall not have or exercise any rights by virtue hereof as a stockholder of
the Company. Notwithstanding the foregoing, the Company shall provide the Registered Holder with
copies of the same notices and other information given to the stockholders of the Company
generally, contemporaneously with the giving thereof to the stockholders.

-7-

 

     14. No Fractional Shares. No fractional shares of Common Stock shall be issued upon
exercise of this Warrant. In lieu of any fractional shares which would otherwise be issuable upon
exercise of this Warrant, the Company shall round up such fractional interest to the next whole
share.

     15. Warrant Legends. 

     (a) Each Warrant shall contain a legend in substantially the following form:

“THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT MAY NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN
EFFECTIVE AND CURRENT REGISTRATION STATEMENT OR POST-EFFECTIVE AMENDMENT
THERETO FOR SUCH SHARES UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”) OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE ACT AND
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY AN
OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE
COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT. THIS WARRANT
AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY SUCH SECURITIES.”

     (b) Each certificate representing the Warrant Stock, unless registered under the Securities
Act shall contain a legend substantially in the following form:

“THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR
TRANSFERRED WITHOUT AN EFFECTIVE AND CURRENT REGISTRATION STATEMENT OR
POST-EFFECTIVE AMENDMENT THERETO FOR SUCH SHARES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, (THE “ACT”) OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY AN OPINION OF COUNSEL IN FORM AND
SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT
REQUIRED UNDER THE ACT. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
OR FINANCING ARRANGEMENT SECURED BY SUCH SECURITIES.”

     16. Amendment or Waiver. Any term of this Warrant may be amended or waived upon
written consent of the Company and the holders of at least a majority of the shares of the
Company’s

-8-

 

equity securities issuable upon exercise of outstanding warrants purchased pursuant to that
certain Subscription Agreement, dated __________, __________, among the Company and the investors
signatory thereto (the “Agreement”). By acceptance hereof, the Registered Holder
acknowledges that in the event the required consent is obtained, any term of this Warrant may be
amended or waived with or without the consent of the Registered Holder; provided,
however, that any amendment hereof that would materially adversely affect the Registered
Holder in a manner different from the holders of the remaining warrants issued pursuant to the
Agreement shall also require the consent of Registered Holder.

     17. Headings. The headings in this Warrant are for purposes of reference only and
shall not limit or otherwise affect the meaning of any provision of this Warrant.

     18. Governing Law. This Warrant shall be governed, construed and interpreted in
accordance with the laws of the State of New York, without giving effect to principles of conflicts
of law.

     19. Survival of Representations. Unless otherwise set forth in this Warrant, the
representations, warranties and covenants contained in or made pursuant to this Warrant shall
survive the execution and delivery of this Warrant.

     20. Successors and Assigns. The terms and conditions of this Warrant shall inure to
the benefit of and be binding upon the respective successors and assigns of the parties. Nothing
in this Warrant, express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Warrant, except as expressly provided in this Warrant.

     21. Counterparts. This Warrant may be executed in one or more counterparts, each of
which shall be deemed an original and all of which together shall constitute one instrument.

     22. Attorney’s Fees. If any action at law or in equity (including arbitration) is
necessary to enforce or interpret the terms of any of this Warrant, the prevailing party shall be
entitled to reasonable attorney’s fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled.

     23. Severability. If one or more provisions of this Warrant are held to be
unenforceable under applicable law, the parties agree to renegotiate such provision in good faith.
In the event that the parties cannot reach a mutually agreeable and enforceable replacement for
such provision, then (a) such provision shall be excluded from this Warrant, (b) the balance of
this Warrant shall be interpreted as if such provision were so excluded and (c) the balance of this
Warrant shall be enforceable in accordance with its terms.

     24. Delays or Omissions. No delay or omission to exercise any right, power or remedy
accruing to any party under this Warrant, upon any breach or default of any other party under this
Warrant, shall impair any such right, power or remedy of such non-breaching or non-defaulting party
nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein,
or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single
breach or default be deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character on the part of any
party of any breach or default under this Warrant, or any waiver on the part of any party of any
provisions or conditions of this Warrant, must be in writing and shall be effective only to the
extent specifically set forth in such writing. All remedies, either under this Warrant or by law
or otherwise afforded to any party, shall be cumulative and not alternative.

-9-

 

     25. Remedies, Other Obligations, Breaches and Injunctive Relief. The remedies
provided in this Warrant shall be cumulative and in addition to all other remedies available under
this Warrant, at law or in equity (including a decree of
specific performance and/or other injunctive relief), and nothing herein shall limit the right of
the Registered Holder to pursue actual damages for any failure by the Company to comply with the terms of this
Warrant. The Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Registered Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or
threatened breach, the Registered Holder shall be entitled to seek, in addition to all other available remedies, to an
injunction restraining any breach, without the necessity of showing economic loss and without any
bond or other security being required

     26. Entire Agreement. This Warrant, and the documents referred to herein constitute
the entire agreement between the parties hereto pertaining to the subject matter hereof, and any
and all other written or oral agreements relating to the subject matter hereof existing between the
parties hereto are expressly canceled.

[Signature Page Follows]

-10-

 

     IN
WITNESS WHEREOF, the Company and the Registered Holder have executed this Warrant as of the date first
set forth above.

	 	 	 	 	 
	 	 	THE COMPANY:
	 
	 	 	 	 
	 	 	VIRNETX HOLDING CORPORATION
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	(Signature)
	 
	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 
	 

	 	Address:	 	 
	 
	 	 	 	 
	 	 	5615 Scotts Valley Drive, Suite 110
	 	 	Scotts Valley, California 95066
	 	 	Fax: (831) 438-8700

	 	 	 	 	 
	ACKNOWLEDGED AND
AGREED TO BY THE REGISTERED HOLDER:	 	 
	 
	 	 	 	 
	 	 	 
	(Registered Holder)	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	(Signature)
	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	Fax:
	 	 	 	 
	 

	 	 	 	 

 

 

EXHIBIT A

PURCHASE/EXERCISE FORM

	 	 	 
	To: VirnetX Holding Corporation

	 	Dated:

     The undersigned, pursuant to the provisions set forth in the attached Warrant No. ___, hereby
irrevocably elects to purchase ___shares of the Common Stock covered by such
Warrant and herewith makes payment of $___, representing the full Purchase Price
for such shares at the price per share provided for in such Warrant.

     Payment shall take the form of (check applicable box):

	 	 	 	 
	 	 ̈ 	 	in lawful money of the United States; or
	 
	 	 	 
	 	 ̈ 	 	the cancellation of such amount of Warrant Stock as is necessary, in accordance
with the formula set forth in Section 2(b), to exercise this Warrant with respect to
the maximum amount of Warrant Stock purchasable pursuant to the cashless exercise
procedure set forth in Section 2(b).

     The undersigned acknowledges that it has reviewed the representations and warranties of the
Registered Holder set forth in the Warrant and by its signature below hereby makes such
representations and warranties to the Company. Defined terms contained in such representations and
warranties shall have the meanings assigned to them in the Warrant, provided that the term
“Securities” shall refer to the Warrant Stock.

	 	 	 	 	 
	ACKNOWLEDGED AND
AGREED TO BY THE REGISTERED HOLDER:	 	 
	 
	 	 	 	 
	 	 	 
	(Registered Holder)	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	(Signature)
	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	Fax:
	 	 	 	 
	 

	 	 	 	 

 

 

EXHIBIT B

ASSIGNMENT FORM

     FOR VALUE RECEIVED, ___hereby sells, assigns and transfers all of the
rights of the undersigned under the attached Warrant with respect to the number of shares of
capital stock covered thereby set forth below, unto:

	 	 	 	 	 
	Name of Assignee
	 	Address/Facsimile Number
	 	No. of Shares

	 	 	 	 	 
	ACKNOWLEDGED AND
AGREED TO BY THE REGISTERED HOLDER:	 	 
	 
	 	 	 	 
	 	 	 
	(Registered Holder)	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	(Signature)
	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 
	Fax:

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