Document:

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                                RIGHTS AGREEMENT

                                     between

                      ALEXANDRIA REAL ESTATE EQUITIES, INC.

                                       and

                    AMERICAN STOCK TRANSFER & TRUST COMPANY,
                                 as Rights Agent

                          Dated as of February 10, 2000
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                                TABLE OF CONTENTS
<S>                                                                         <C>
                                                                               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..........................................10

Section 5.  Countersignature and Registration ...................................11

Section 6.  Transfer, Split-Up, Combination and
                      Exchange of Rights Certificates;
                      Mutilated, Destroyed, Lost or Stolen
                      Rights Certificates........................................12

Section 7.  Exercise of Rights; Purchase Price;
                      Expiration Date of Rights..................................13

Section 8.  Cancellation and Destruction of
                      Rights Certificates........................................16

Section 9.  Reservation and Availability
                      of Capital Stock...........................................17

Section 10.  Preferred Stock Record Date.........................................19

Section 11.  Adjustment of Purchase Price,
                       Number and Kind of Shares or Number
                      of Rights..................................................19

Section 12.  Certificate of Adjusted Purchase
                      Price or Number of Shares..................................32

Section 13.  Consolidation, Merger or Sale
                      or Transfer of Assets, Cash Flow
                      or Earning Power...........................................32

Section 14.  Fractional Rights and Fractional
                      Shares.....................................................36

Section 15.  Rights of Action....................................................38

Section 16.  Agreement of Rights Holders.........................................38

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Section 17.  Rights Certificate Holder Not
                      Deemed a Stockholder.......................................39

Section 18.  Concerning the Rights Agent.........................................40

Section 19.  Merger or Consolidation or Change
                      of Name of Rights Agent....................................41

Section 20.  Duties of Rights Agent..............................................41

Section 21.  Change of Rights Agent..............................................44

Section 22.  Issuance of New Rights Certificates.................................46

Section 23.  Redemption and Termination..........................................46

Section 24.  Exchange............................................................47

Section 25.  Notice of Certain Events............................................49

Section 26.  Notices.............................................................50

Section 27.  Supplements and Amendments..........................................51

Section 28.  Successors..........................................................52

Section 29.  Determinations and Actions by
                      the Board of Directors, etc................................52

Section 30.  Benefits of this Agreement..........................................53

Section 31.  Severability........................................................53

Section 32.  Governing Law.......................................................54

Section 33.  Counterparts........................................................54

Section 34.  Descriptive Headings................................................54
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                                    EXHIBITS

Exhibit A -B          Form of Articles Supplementary

Exhibit B --          Form of Rights Certificate

Exhibit C --          Form of Summary of Rights

                                      -ii-
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                                RIGHTS AGREEMENT

               RIGHTS AGREEMENT, dated as of February 10, 2000 (the
"Agreement"), between Alexandria Real Estate Equities, Inc., a Maryland
corporation (the "Company"), and American Stock Transfer & Trust Company, a New
York corporation (the "Rights Agent").

                               W I T N E S S E T H

               WHEREAS, on February 4, 2000 (the "Rights Dividend Declaration
Date"), the Board of Directors of the Company authorized and declared a dividend
distribution of one Right (as hereinafter defined) for each share of common
stock, par value $.01 per share, of the Company (the "Common Stock") outstanding
at the close of business on February 24, 2000 (the "Record Date"), and has
authorized the issuance of one Right (as such number may hereinafter be adjusted
pursuant to the provisions of Section 11(p) hereof) for each share of Common
Stock of the Company issued between the Record Date (whether originally issued
or delivered from the Company's treasury) and the Distribution Date (as
hereinafter defined), each Right initially representing the right to purchase
one one-hundredth of a share of Series A Junior Participating Preferred Stock of
the Company (the "Preferred Stock") having the rights, powers and preferences
set forth in the form of Articles Supplementary, attached hereto as Exhibit A,
upon the terms and subject to the conditions hereinafter set forth (the
"Rights");

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

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

                      (a)  "Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 15% or more of the shares of Common Stock then outstanding,
but shall not include (i) the Company, (ii) any

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Subsidiary of the Company, (iii) 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, or
(iv) any Person who becomes the Beneficial Owner of fifteen percent (15%) or
more of the shares of Common Stock then outstanding as a result of a reduction
in the number of shares of Common Stock outstanding due to the repurchase of
shares of Common Stock by the Company unless and until such Person, after
becoming aware that such Person has become the Beneficial Owner of fifteen
percent (15%) or more of the then outstanding shares of Common Stock, acquires
beneficial ownership of additional shares of Common Stock representing one
percent (1%) or more of the shares of Common Stock then outstanding, or (v) any
such Person who has reported or is required to report such ownership (but less
than 20%) on Schedule 13G under the Securities and Exchange Act of 1934, as
amended and in effect on the date of the Agreement (the "Exchange Act") (or any
comparable or successor report) or on Schedule 13D under the Exchange Act (or
any comparable or successor report) which Schedule 13D does not state any
intention to or reserve the right to control or influence the management or
policies of the Company or engage in any of the actions specified in Item 4 of
such schedule (other than the disposition of the Common Stock) and, within 10
Business Days of being requested by the Company to advise it regarding the same,
certifies to the Company that such Person acquired shares of Common Stock in
excess of 14.9% inadvertently or without knowledge of the terms of the Rights
and who, together with all Affiliates and Associates, thereafter does not
acquire additional shares of Common Stock while the Beneficial Owner of 15% or
more of the shares of Common Stock then outstanding; PROVIDED, HOWEVER, that if
the Person requested to so certify fails to do so within 10 Business Days, then
such Person shall become an Acquiring Person immediately after such
10-Business-Day period.

                      (b)  "Act" shall mean the Securities Act of 1933.

                      (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.

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

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

                             (ii)  which such Person or any of such
        Person's Affiliates or Associates, directly or indirectly, has the right
        to vote or dispose of or has "beneficial ownership" of (as determined
        pursuant to Rule 13d-3 of the General Rules and Regulations under the
        Exchange Act), including pursuant to any agreement, arrangement or
        understanding, whether or not in writing; PROVIDED, HOWEVER, that a
        Person shall not be deemed the "Beneficial Owner" of, or to
        "beneficially own," any security under this subparagraph (ii) as a
        result of an agreement, arrangement or understanding to vote

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        such security if such agreement, arrangement or understanding: (A)
        arises solely from a revocable proxy given in response to a public proxy
        or consent solicitation made pursuant to, and in accordance with, the
        applicable provisions of the General Rules and Regulations under the
        Exchange Act, and (B) is not reportable by such Person 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), for the purpose of acquiring, holding, voting (except
        pursuant to a revocable proxy as described in the proviso to
        subparagraph (ii) of this paragraph (d)) or disposing of any voting
        securities of the Company; PROVIDED, HOWEVER, that nothing in this
        paragraph (d) shall cause a Person engaged in business as an underwriter
        of securities to be the "Beneficial Owner" of, or to "beneficially own,"
        any securities acquired through such Person's participation in good
        faith in a firm commitment underwriting until the expiration of forty
        days after the date of such acquisition, and then only if such
        securities continue to be owned by such Person at such expiration of
        forty days.

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

                      (f)  "Close of business" on any given date shall mean
5:00 P.M., New York City time, on such date; PROVIDED, HOWEVER, that if such
date is not a Business Day, it shall mean 5:00 P.M., New York City time, on the
next succeeding Business Day.

                      (g)  "Common Stock" shall mean the common stock, par
value $.01 per share, of the Company, except that "Common Stock" when used with
reference to any Person other than the Company shall mean the capital stock of
such Person with the greatest voting power, or

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the equity securities or other equity interest having power to control or direct
the management, of such Person.

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

                      (i)  "Current Market Price" shall have the meaning set
forth in Section 11(d)(i) hereof.

                      (j)  "Current Value" shall have the meaning set forth in
Section 11(a)(iii) hereof.

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

                      (l)  "Equivalent Preferred Stock" shall have the meaning
set forth in Section 11(b) hereof.

                      (m)  "Exchange Act" shall mean the Securities and
Exchange Act of 1934.

                      (n)  "Exchange Ratio" shall have the meaning set forth in
Section 24 hereof.

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

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

                      (q)  "Person" shall mean any individual, firm,
corporation, partnership or other entity.

                      (r)  "Preferred Stock" shall mean shares of Series A
Junior Participating Preferred Stock, par value $.01 per share, of the Company,
and, to the extent that there are not a sufficient number of shares of Series A
Junior Participating Preferred Stock authorized to permit the full exercise of
the Rights, any other series of preferred stock of the Company designated for
such purpose containing terms substantially similar to the terms of the Series A
Junior Participating Preferred Stock.

                      (s)  "Principal Party" shall have the meaning set forth
in Section 13(b) hereof.

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                      (t)  "Purchase Price" shall have the meaning set forth in
Section 4(a)(ii) hereof.

                      (u)  "Qualified Offer" shall have the meaning set forth
in Section 11(a)(ii) hereof.

                      (v)  "Record Date" shall have the meaning set forth in
the WHEREAS clause at the beginning of this Agreement.

                      (w)  "Rights" shall have the meaning set forth in the
WHEREAS clause at the beginning of this Agreement.

                      (x)  "Rights Agent" shall have the meaning set forth in
the parties clause at the beginning of this Agreement.

                      (y)  "Rights Certificate" shall have the meaning set
forth in Section 3(a) hereof.

                      (aa) "Rights Dividend Declaration Date" shall have the
meaning set forth in the WHEREAS clause at the beginning of this Agreement.

                      (bb) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii) hereof.

                      (cc) "Section 13 Event" shall mean any event described
in clauses (x), (y) or (z) of Section 13(a) hereof.

                      (dd) "Spread" shall have the meaning set forth in
Section 11(a)(iii) hereof.

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

                      (ff) "Subsidiary" shall mean, with reference to any
Person, any corporation of which an amount of voting securities sufficient to
elect at least a majority of the directors of such corporation is beneficially

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owned, directly or indirectly, by such Person, or otherwise controlled by such
Person.

                    (gg) "Substitution Period" shall have the meaning set forth
in Section 11(a)(iii) hereof.

                    (hh) "Summary of Rights" shall have the meaning set forth in
Section 3(b) hereof.

                    (ii) "Trading Day" shall have the meaning set forth in
Section 11(d)(i) hereof.

                    (jj) "Triggering Event" shall mean any Section 11(a)(ii)
Event or any Section 13 Event.

         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.

         Section 3. ISSUANCE OF RIGHTS CERTIFICATES.

              (a) Until the earlier of (i) the close of business on the tenth
day after the Stock Acquisition Date (or, if the tenth day after the Stock
Acquisition Date occurs before the Record Date, the close of business on the
Record Date), or (ii) the close of business on the tenth Business Day (or such
later date as the Board shall determine) 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 upon consummation thereof, such Person
would become an Acquiring Person, in either instance other than pursuant to a
Qualified Offer(the earlier of (i) and (ii) being herein referred to as the
"Distribution Date"),(x) the Rights will be represented (subject to the
provisions of paragraph (b) of this Section 3) by

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the certificates for the Common Stock registered in the names of the holders of
the Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the Company). As soon as
practicable after the Distribution Date, the Rights Agent will send by
first-class, insured, postage-prepaid mail, to each record holder of the Common
Stock as of the close of business on the Distribution Date, at the address of
such holder shown on the records of the Company, one or more right certificates,
in substantially the form of Exhibit B hereto (the "Rights Certificates"),
representing one Right for each share of Common Stock so held, subject to
adjustment as provided herein. In the event that an adjustment in the number of
Rights per share of Common Stock has been made pursuant to Section 11(p) hereof,
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. As of
and after the Distribution Date, the Rights will be represented solely by such
Rights Certificates.

              (b) The Company will make available, as promptly as practicable
following the Record Date, a copy of a Summary of Rights, in substantially the
form attached hereto as Exhibit C (the "Summary of Rights") to any holder of
Rights who may so request from time to time prior to the Expiration Date. With
respect to certificates for the Common Stock outstanding as of the Record Date,
until the Distribution Date, the Rights will be represented by such certificates
for the Common Stock and the registered holders of the Common Stock shall also
be the registered holders of the associated Rights. Until the earlier of the
Distribution Date or the Expiration Date (as such term is defined in Section
7(a) hereof), the transfer of any certificates representing shares of Common
Stock in respect of which Rights have been issued shall also constitute the
transfer of the Rights associated with such shares of Common Stock.

              (c) Rights shall be issued in respect of all shares of Common
Stock which are issued after the

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Record Date but prior to the earlier of the Distribution Date or the Expiration
Date. Certificates representing such shares of Common Stock shall also be deemed
to be certificates for Rights, and shall bear the following legend:

               This certificate also represents and entitles the holder hereof
          to certain Rights as set forth in the Rights Agreement between
          Alexandria Real Estate Equities, Inc.(the "Company") and the Rights
          Agent thereunder (the "Rights Agreement"), the terms of which are
          hereby incorporated herein by reference and a copy of which is on file
          at the principal offices of the Company. Under certain circumstances,
          as set forth in the Rights Agreement, such Rights will be represented
          by separate certificates and will no longer be represented by this
          certificate. The Company will mail to the holder of this certificate a
          copy of the Rights Agreement, as in effect on the date of mailing,
          without charge, promptly after receipt of a written request therefor.
          Under certain circumstances set forth in the Rights Agreement, Rights
          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 (i) the Distribution Date or (ii) the Expiration Date, the Rights
associated with the Common Stock represented by such certificates shall be
represented by such certificates alone and registered holders of Common Stock
shall also be the registered holders of the associated Rights, and the transfer
of any of such certificates shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificates.

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         Section 4. FORM OF RIGHTS CERTIFICATES.

              (a) The Rights Certificates (and the forms of election to purchase
and of assignment to be printed on the reverse thereof) shall each be
substantially in the form set forth in Exhibit B hereto and may have such marks
of identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Rights may from time to
time be listed, or to conform to usage. Subject to the provisions of Section 11
and Section 22 hereof, the Rights Certificates, whenever distributed, shall be
dated as of the Record Date and on their face shall entitle the holders thereof
to purchase such number of one one-hundredths of a share of Preferred Stock as
shall be set forth therein at the price set forth therein (such exercise price
per one one-hundredth of a share, the "Purchase Price"), but the amount and type
of securities purchasable upon the exercise of each Right and the Purchase Price
thereof shall be subject to adjustment as provided herein.

              (b) Any Rights Certificate issued pursuant to Section 3(a),
Section 11(i) 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 transferee of an Acquiring Person (or of any such Associate or Affiliate)
who becomes a transferee after the Acquiring Person becomes such, or (iii) a
transferee of an Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring Person becoming
such and receives such Rights pursuant to either (A) a transfer (whether or not
for consideration) from the Acquiring Person to holders of equity interests in
such Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect avoidance of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11 hereof upon transfer,

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exchange, replacement or adjustment of any other Rights Certificate referred to
in this sentence, shall contain (to the extent feasible) the following legend:

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

              (b) Following the Distribution Date, the Rights Agent will keep,
or cause to be kept, at its

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principal office or offices designated as the appropriate place for surrender of
Rights Certificates upon exercise or transfer, books for registration and
transfer of the Rights Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Rights Certificates, the
number of Rights represented 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 4(b), Section 7(e) and
Section 14 hereof, at any time after the close of business on the Distribution
Date, and at or prior to the close of business on the Expiration Date, any
Rights Certificate or Certificates (other than Rights Certificates representing
Rights that may have been exchanged pursuant to Section 24 hereof) may be
transferred, split up, combined or exchanged for another Rights Certificate or
Certificates, entitling the registered holder to purchase a like number of one
one-hundredths of a share of Preferred Stock (or, following a Triggering Event,
Common Stock, other securities, cash or other assets, as the case may be) as the
Rights Certificate or Certificates surrendered then entitles such holder (or
former holder in the case of a transfer) to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Rights Certificate or
Certificates shall make such request in writing delivered to the Rights Agent,
and shall surrender the Rights Certificate or Certificates to be transferred,
split up, combined or exchanged at the principal office or offices of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the Company
shall be obligated to take any action whatsoever with respect to the transfer of
any such surrendered Rights Certificate until the registered holder shall have
completed and signed the certificate contained in the form of assignment on the
reverse side of such Rights Certificate and shall have provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request.
Thereupon the Rights Agent shall, subject to Section 4(b), Section 7(e), Section
14 hereof and

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Section 24 hereof, countersign and deliver to the Person entitled thereto a
Rights Certificate or Rights Certificates, as the case may be, as so requested.
The Company may require payment 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.

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

         Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS.

              (a) Subject to Section 7(e) hereof, at any time after the
Distribution Date the registered holder of any Rights Certificate may exercise
the Rights represented thereby (except as otherwise provided herein including,
without limitation, the restrictions on exercisability set forth in Section
9(c), Section 11(a)(iii) and Section 23(a) hereof) in whole or in part upon
surrender of the Rights Certificate, with the form of election to purchase and
the certificate on the reverse side thereof duly executed, to the Rights Agent
at the principal office or offices of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price with respect to
the total number of one one-hundredths of a share of Preferred Stock (or with
respect to other securities, cash or other assets, as the case may be) as to
which such surrendered Rights are then exercisable, at or prior to the earlier
of (i) 5:00 P.M., New York City time, on February 10,2010, or such later date as
may be established by the Board of Directors prior to the expiration of the
Rights (such date, as it may be extended by the Board, the ("Final

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Expiration Date"), or (ii) the time at which the Rights are redeemed or
exchanged as provided in Section 23 and Section 24 hereof (the earlier of (i)
and (ii) being herein referred to as the "Expiration Date").

              (b) The Purchase Price for each one one-hundredth of a share of
Preferred Stock pursuant to the exercise of a Right shall initially be $120, and
shall be subject to adjustment from time to time as provided in Section 11 and
Section 13(a) hereof and shall be payable in accordance with paragraph (c)
below.

              (c) Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase and the certificate duly executed,
accompanied by payment, with respect to each Right so exercised, of the Purchase
Price per one one-hundredth of a share of Preferred Stock (or other shares,
securities, cash or other assets, as the case may be) to be purchased as set
forth below and an amount equal to any applicable transfer tax, the Rights Agent
shall, subject to Section 20(k) hereof, thereupon promptly (i) (A) requisition
from any transfer agent of the shares of Preferred Stock (or make available, if
the Rights Agent is the transfer agent for such shares) certificates for the
total number of one one-hundredths of a share of Preferred Stock 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 shares of Preferred Stock issuable upon exercise of the Rights
hereunder with a depositary agent, requisition from the depositary agent
depositary receipts representing such number of one one-hundredths of a share of
Preferred Stock as are to be purchased (in which case certificates for the
shares of Preferred Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company will direct the
depositary agent to comply with such request, (ii) requisition from the Company
the amount of cash, if any, to be paid in lieu of fractional shares in
accordance with Section 14 hereof, (iii) after receipt of such certificates or
depositary receipts, cause the same to be delivered to or, upon the order of the
registered holder of such Rights Certifcate, registered in such name or names
as may be designated by such holder, and (iv) after receipt thereof, deliver
such cash, if any, to or upon the order of the registered holder of such Rights
Certif-

                                       14
<PAGE>

icate. The payment of the Purchase Price (as such amount may be reduced
pursuant to Section 11(a)(iii) hereof) shall be made in cash or by certified
bank check or bank draft payable to the order of the Company. In the event
that the Company is obligated to issue other securities (including Common
Stock) of the Company, 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. The Company
reserves the right to require prior to the occurrence of a Triggering Event
that, upon any exercise of Rights, a number of Rights be exercised so that
only whole shares of Preferred Stock would be issued.

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

              (e) Notwithstanding anything in this Agreement to the contrary,
from and after the first occurrence of a Section 11(a)(ii) Event, any Rights
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of an
Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board of Directors
of the Company 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),
shall become null and void without any further action and

                                       15
<PAGE>

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 insure 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 any other Person as a result of its failure
to make any determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder.

              (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 this Section 7 unless such registered holder shall have
(i) completed and signed the certificate contained in the form of election to
purchase set forth on the reverse side of the Rights Certificate surrendered for
such exercise, and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.

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

                                       16
<PAGE>

         Section 9. RESERVATION AND AVAILABILITY OF CAPITAL STOCK.

              (a) The Company will cause to be reserved and kept available out
of its authorized and unissued shares of Preferred Stock (and, following the
occurrence of a Triggering Event, out of its authorized and unissued shares of
Common Stock and/or other securities), the number of shares of Preferred Stock
(and, following the occurrence of a Triggering Event, Common Stock and/or other
securities) that, as provided in this Agreement including Section 11(a)(iii)
hereof, will be sufficient to permit the exercise in full of all outstanding
Rights.

              (b) So long as the shares of Preferred Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any national
securities exchange, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable, all shares reserved for such
issuance to be listed on such exchange 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 Section
11(a)(ii) Event on which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with Section 11(a)(iii)
hereof, a registration statement under the Act, with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Act) until the earlier
of (A) the date as of which the Rights are no longer exercisable for such
securities, and (B) the date of the expiration of the Rights. The Company will
also take such action as may be appropriate under, or to ensure compliance with,
the securities or "blue sky" laws of the various states in connection with the
exercisability of the Rights. The Company may temporarily suspend, for a period
of time not to exceed 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

                                       17
<PAGE>

order to prepare and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension has
been rescinded. In addition, if the Company shall determine that a registration
statement is required following the Distribution Date, the Company may
temporarily suspend the exercisability of the Rights until such time as a
registration statement has been declared effective. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction if the requisite qualification in such jurisdiction shall
not have been obtained, the exercise thereof shall not be permitted under
applicable law, or a registration statement shall not have been declared
effective.

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

              (e) The Company will pay when due and payable any and all
federal and state transfer taxes and charges which may be payable in respect
of the issuance or delivery of the Rights Certificates and of any
certificates for a number of one one-hundredths of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may be) upon the
exercise of Rights. The Company shall not, however, be required to pay any
transfer tax 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 a
number of one one-hundredths of a share of Preferred Stock (or Common Stock
and/or other securities, as the case may be) in respect of a name other than
that of the registered holder of the Rights Certificates evidencing Rights
surrendered for exercise or to issue or deliver any certificates for a number
of one one-hundredths of a share of Preferred Stock (or Common Stock and/or
other securities, as the case may be) in a name other than that of the
registered

                                       18

<PAGE>

holder upon the exercise of any Rights until such tax shall have been paid
(any such tax being payable by the holder of such Rights Certificate at the
time of surrender) or until it has been established to the Company's
satisfaction that no such tax is due.

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

         Section 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES OR
NUMBER OF RIGHTS. The Purchase Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.

                                       19

<PAGE>

                  (a)(i) In the event the Company shall at any time after the
         date of this Agreement (A) declare a dividend on the Preferred Stock
         payable in shares of Preferred Stock, (B) subdivide the outstanding
         Preferred Stock, (C) combine the outstanding Preferred Stock into a
         smaller number of shares, or (D) issue any shares of its stock in a
         reclassification of the Preferred Stock (including any such
         reclassification in connection with a consolidation or merger in which
         the Company is the continuing or surviving corporation), except as
         otherwise provided in this Section 11(a) and Section 7(e) hereof, the
         Purchase Price in effect at the time of the record date for such
         dividend or of the effective date of such subdivision, combination or
         reclassification, and the number and kind of shares of Preferred Stock
         or other stock, as the case may be, issuable on such date, shall be
         proportionately adjusted so that the holder of any Right exercised
         after such time shall be entitled to receive, upon payment of the
         Purchase Price then in effect, the aggregate number and kind of shares
         of Preferred Stock or other stock, as the case may be, which, if such
         Right had been exercised immediately prior to such date and at a time
         when the Preferred Stock transfer books of the Company were open, such
         holder would have owned upon such exercise and been entitled to receive
         by virtue of such dividend, subdivision, combination or
         reclassification. If an event occurs which would require an adjustment
         under both this Section 11(a)(i) and Section 11(a)(ii) hereof, the
         adjustment provided for in this Section 11(a)(i) shall be in addition
         to, and shall be made prior to, any adjustment required pursuant to
         Section 11(a)(ii) hereof.

                  (ii) In the event any Person shall, at any time after the
         Rights Dividend Declaration Date, become an Acquiring Person, unless
         the event causing such Person to become an Acquiring Person is a
         transaction set forth in Section 13(a) hereof, or is an acquisition of
         shares of Common Stock pursuant to a tender offer or an exchange offer
         for all outstanding

                                       20
<PAGE>

         shares of Common Stock at a price and on terms determined by at least a
         majority of the members of the Board of Directors who are not officers
         of the Company and who are not representatives, nominees, Affiliates or
         Associates of an Acquiring Person, after receiving advice from one or
         more investment banking firms, to be (a) at a price which is fair to
         stockholders and not inadequate (taking into account all factors which
         such members of the Board deem relevant, including, without limitation,
         prices which could reasonably be achieved if the Company or its assets
         were sold on an orderly basis designed to realize maximum value) and
         (b) otherwise in the best interests of the Company and its stockholders
         (a "Qualified Offer")

then, promptly following the occurrence of such event, proper provision shall be
made so that each holder of a Right (except as provided below and in Section
7(e) hereof) shall thereafter have the right to receive, upon exercise thereof
at the then current Purchase Price in accordance with the terms of this
Agreement, in lieu of a number of one one-hundredths of a share of Preferred
Stock, such number of shares of Common Stock of the Company as shall equal the
result obtained by (x) multiplying the then current Purchase Price by the then
number of one one-hundredths of a share of Preferred Stock for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a)(ii)
Event, and (y) dividing that product (which, following such first occurrence,
shall thereafter be referred to as the "Purchase Price" for each Right and for
all purposes of this Agreement) by 50% of the Current Market Price (determined
pursuant to Section 11(d) hereof) per share of Common Stock on the date of such
first occurrence (such number of shares, the "Adjustment Shares").

                  (iii) In the event that the number of shares of Common Stock
         which are authorized by the Company's charter, but which are not
         outstanding or reserved for issuance for purposes other than upon
         exercise of the Rights, are not sufficient to permit the exercise in
         full of the Rights in accordance with the foregoing subparagraph (ii)
         of this Section

                                       21

<PAGE>

         11(a), the Company shall (A) determine the value of the Adjustment
         Shares issuable upon the exercise of a Right (the "Current Value"), and
         (B) with respect to each Right (subject to Section 7(e) hereof), make
         adequate provision to substitute for the Adjustment Shares, upon the
         exercise of a Right and payment of the applicable Purchase Price, (1)
         cash, (2) a reduction in the Purchase Price, (3) Common Stock or other
         equity securities of the Company (including, without limitation,
         shares, or units of shares, of preferred stock, such as the Preferred
         Stock, which the Board has deemed to have essentially the same value or
         economic rights as shares of Common Stock (such shares of preferred
         stock being referred to as "Common Stock Equivalents")), (4) debt
         securities of the Company, (5) other assets, or (6) any combination of
         the foregoing, having an aggregate value equal to the Current Value
         (less the amount of any reduction in the Purchase Price), where such
         aggregate value has been determined by the Board 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
         Section 11(a)(ii) 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 Purchase
         Price, shares of Common Stock (to the extent available) and then, if
         necessary, cash, which shares and/or cash have an aggregate value equal
         to the Spread. For purposes of the preceding sentence, the term
         "Spread" shall mean the excess of (i) the Current Value over (ii) the
         Purchase Price. If the Board determines in good faith that it is likely
         that sufficient additional shares of Common Stock could be authorized
         for issuance upon exercise in full of the Rights,

                                       22
<PAGE>

         the thirty (30) day period set forth above may be extended to the
         extent necessary, but not more than ninety (90) days after the Section
         11(a)(ii) Trigger Date, in order that the Company may seek stockholder
         approval for the authorization of such additional shares (such thirty
         (30) day period, as it may be extended, is herein called the
         "Substitution Period"). To the extent that action is to be taken
         pursuant to the first and/or third sentences of this Section
         11(a)(iii), the Company (1) shall provide, subject to Section 7(e)
         hereof, that such action shall apply uniformly to all outstanding
         Rights, and (2) may suspend the exercisability of the Rights until the
         expiration of the Substitution Period in order to seek such stockholder
         approval for such authorization of additional shares 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. For purposes of this Section 11(a)(iii), the value of
         each Adjustment Share shall be the current market price per share of
         the Common Stock on the Section 11(a)(ii) Trigger Date and the per
         share or per unit value of any Common Stock Equivalent shall be deemed
         to equal the current market price per share of the Common Stock on such
         date.

                    (b) In case the Company shall fix a record date for the
     issuance of rights, options or warrants to all holders of Preferred Stock
     entitling them to subscribe for or purchase (for a period expiring within
     forty-five (45) calendar days after such record date) Preferred Stock (or
     shares having the same rights, privileges and preferences as the shares of
     Preferred Stock ("Equivalent Preferred Stock")) or securities convertible
     into Preferred Stock or Equivalent Preferred Stock at a price per share of
     Preferred Stock or per share of Equivalent Preferred Stock (or having a
     conversion price per share, if a security convertible into Preferred Stock
     or

                                       23
<PAGE>

     Equivalent Preferred Stock) less than the Current Market Price (as
     determined pursuant to Section 11(d) hereof) per share of Preferred Stock
     on such record date, the Purchase Price to be in effect after such record
     date shall be determined by multiplying the Purchase Price in effect
     immediately prior to such record date by a fraction, the numerator of which
     shall be the number of shares of Preferred Stock outstanding on such record
     date, plus the number of shares of Preferred Stock which the aggregate
     offering price of the total number of shares of Preferred Stock and/or
     Equivalent Preferred Stock so to be offered (and/or the aggregate initial
     conversion price of the convertible securities so to be offered) would
     purchase at such Current Market Price, and the denominator of which shall
     be the number of shares of Preferred Stock outstanding on such record date,
     plus the number of additional shares of Preferred Stock and/or Equivalent
     Preferred Stock to be offered for subscription or purchase (or into which
     the convertible securities so to be offered are initially convertible). In
     case such subscription price may be paid by delivery of consideration, part
     or all of which may be in a form other than cash, the value of such
     consideration shall be as determined in good faith by the Board of
     Directors of the Company, whose determination shall be described in a
     statement filed with the Rights Agent and shall be binding on the Rights
     Agent and the holders of the Rights. Shares of Preferred Stock 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 or
     warrants are not so issued, the Purchase Price shall be adjusted to be the
     Purchase Price which would then be in effect if such record date had not
     been fixed.

                    (c) In case the Company shall fix a record date for a
     distribution to all holders of Preferred Stock (including any such
     distribution made in connection with a consolidation or merger in which the
     Company is the continuing or surviving corporation) of evidences of
     indebtedness, cash (other than a regular quarterly cash dividend out of the
     earnings or retained earnings of the Company), assets (other than a
     dividend payable in Preferred Stock, but including any dividend payable in
     stock other than Preferred Stock) or subscription rights or warrants
     (excluding those referred to in

                                       24
<PAGE>

     Section 11(b) hereof), the Purchase Price to be in effect after such record
     date shall be determined by multiplying the Purchase Price in effect
     immediately prior to such record date by a fraction, the numerator of which
     shall be the Current Market Price (as determined pursuant to Section 11(d)
     hereof) per share of Preferred Stock on such record date, less the fair
     market value (as determined in good faith by the Board of Directors of the
     Company, whose determination shall be described in a statement filed with
     the Rights Agent) 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 share of Preferred Stock, and the denominator of
     which shall be such Current Market Price (as determined pursuant to Section
     11(d) hereof) per share of Preferred Stock. Such adjustments shall be made
     successively whenever such a record date is fixed, and in the event that
     such distribution is not so made, the Purchase Price shall be adjusted to
     be the Purchase Price which would have been in effect if such record date
     had not been fixed.

                    (d)(i) For the purpose of any computation hereunder, other
     than computations made pursuant to Section 11(a)(iii) hereof, the Current
     Market Price per share of Common Stock on any date shall be deemed to be
     the average of the daily closing prices per share of such Common Stock 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 Market Price per share of Common Stock on any date
     shall be deemed to be the average of the daily closing prices per share of
     such Common Stock for the ten (10) consecutive Trading Days immediately
     following such date; PROVIDED, HOWEVER, that in the event that the Current
     Market Price per share of the Common Stock is determined during a period
     following the announcement by the issuer of such Common Stock of (A) a
     dividend or distribution on such Common Stock payable in shares of such
     Common Stock or securities convertible into shares of such Common Stock
     (other than the Rights), or (B) any subdivision, combination or
     reclassification of such Common Stock, and the ex-dividend date for such
     dividend or distribution, or the record date for such subdivision,
     combination or reclassification shall not have occurred prior to the
     commencement of the requisite thirty (30) Trading Day or ten (10) Trading
     Day period, as set forth

                                       25
<PAGE>

     above, then, and in each such case, the Current Market Price shall be
     properly adjusted to take into account ex-dividend trading. The closing
     price for each day shall be the last sale price, regular way, or, in case
     no such sale takes place on such day, the average of the closing bid and
     asked prices, regular way, in either case as reported in the principal
     consolidated transaction reporting system with respect to securities listed
     or admitted to trading on the New York Stock Exchange or, if the shares of
     Common Stock are not listed or admitted to trading on 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 shares of Common Stock are listed or
     admitted to trading or, if the shares of Common Stock are not listed or
     admitted to trading on any national securities exchange, the last quoted
     price or, if not so quoted, the average of the high bid and low asked
     prices in the over-the-counter market, as reported by the National
     Association of Securities Dealers Automated Quotation System ("NASDAQ") or
     such other system then in use, or, if on any such date the shares of Common
     Stock are not quoted by any such organization, the average of the closing
     bid and asked prices as furnished by a professional market maker making a
     market in the Common Stock selected by the Board. If on any such date no
     market maker is making a market in the Common Stock, the fair value of such
     shares on such date as determined in good faith by the Board shall be used.
     The term "Trading Day" shall mean a day on which the principal national
     securities exchange on which the shares of Common Stock are listed or
     admitted to trading is open for the transaction of business or, if the
     shares of Common Stock are not listed or admitted to trading on any
     national securities exchange, a Business Day. If the Common Stock is not
     publicly held or not so listed or traded, Current Market Price per share
     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.

                         (ii) For the purpose of any computation hereunder, the
          Current Market Price per share of Preferred Stock shall be determined
          in the same manner as set forth above for

                                       26
<PAGE>

         the Common Stock in clause (i) of this Section 11(d) (other than the
         last sentence thereof). If the Current Market Price per share of
         Preferred Stock cannot be determined in the manner provided above or if
         the Preferred Stock is not publicly held or listed or traded in a
         manner described in clause (i) of this Section 11(d), the Current
         Market Price per share of Preferred Stock shall be conclusively deemed
         to be an amount equal to 100 (as such number may be appropriately
         adjusted for such events as stock splits, stock dividends and
         recapitalizations with respect to the Common Stock occurring after the
         date of this Agreement) multiplied by the Current Market Price per
         share of the Common Stock. If neither the Common Stock nor the
         Preferred Stock is publicly held or so listed or traded, Current Market
         Price per share of the Preferred Stock 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. For all purposes of this Agreement, the
         Current Market Price of a unit, consisting of one one-hundredth of a
         share of Preferred Stock, shall be equal to the Current Market Price of
         one share of Preferred Stock divided by 100.

                    (e) Anything herein to the contrary notwithstanding, no
     adjustment in the Purchase Price shall be required unless such adjustment
     would require an increase or decrease of at least one percent (1%) in the
     Purchase Price; PROVIDED, HOWEVER, that any adjustments which by reason of
     this Section 11(e) are not required to be made shall be carried forward and
     taken into account in any subsequent adjustment. All calculations under
     this Section 11 shall be made to the nearest cent or to the nearest
     ten-thousandth of a share of Common Stock or other share or one-millionth
     of a share of Preferred Stock, as the case may be. Notwithstanding the
     first sentence of this Section 11(e), any adjustment required by this
     Section 11 shall be made no later than the earlier of (i) three (3) years
     from the date of the transaction which mandates such adjustment, or (ii)
     the Expiration Date.

                                       27
<PAGE>

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

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

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

               (i) The Company may elect on or after the date of any adjustment
     of the Purchase Price to adjust the number of Rights, in lieu of any
     adjustment in the number of one one-hundredths of a share of Preferred
     Stock purchasable upon the exercise of a Right. Each of the Rights
     outstanding after the adjustment in the number of Rights shall be
     exercisable for the number of one one-hundredths of a share of Preferred
     Stock for which a

                                       28
<PAGE>

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

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

                                       29
<PAGE>

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

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

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

                                       30
<PAGE>

                    (n) The Company shall not, at any time after the
     Distribution Date, (i) consolidate with any other Person (other than a
     Subsidiary of the Company in a transaction which complies with Section
     11(o) hereof), (ii) merge with or into any other Person (other than a
     Subsidiary of the Company in a transaction which complies with Section
     11(o) hereof), or (iii) sell or transfer (or permit any Subsidiary to sell
     or transfer), in one transaction, or a series of related transactions,
     assets, cash flow or earning power aggregating more than 50% 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 and/or any of its
     Subsidiaries in one or more transactions each of which complies with
     Section 11(o) hereof), if (x) at the time of or immediately after such
     consolidation, merger or sale 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 or (y) prior to, simultaneously with or immediately
     after such consolidation, merger or sale, the shareholders of the Person
     who constitutes, or would constitute, the "Principal Party" for purposes of
     Section 13(a) hereof shall have received a distribution of Rights
     previously owned by such Person or any of its Affiliates and Associates.

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

                    (p) Anything in this Agreement to the contrary
     notwithstanding, in the event that the Company shall at any time after the
     Rights Dividend Declaration Date and prior to the Distribution Date (i)
     declare a dividend on the outstanding shares of Common Stock payable in
     shares of Common Stock, (ii) subdivide the outstanding shares of Common
     Stock, or (iii) combine the outstanding shares of Common Stock into a
     smaller number of shares, the number of Rights associated with each share
     of Common Stock then outstanding, or issued or delivered thereafter but
     prior to the Distribution Date, shall be proportionately adjusted so that
     the number of

                                       31
<PAGE>

     Rights thereafter associated with each share of Common Stock following any
     such event shall equal the result obtained by multiplying the number of
     Rights associated with each share of Common Stock immediately prior to such
     event by a fraction the numerator which shall be the total number of shares
     of Common Stock outstanding immediately prior to the occurrence of the
     event and the denominator of which shall be the total number of shares of
     Common Stock outstanding immediately following the occurrence of such
     event.

               Section 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF
     SHARES. Whenever an adjustment is made as provided in Section 11 and
     Section 13 hereof, the Company shall (a) promptly prepare a certificate
     setting forth such adjustment and a brief statement of the facts accounting
     for such adjustment, (b) promptly file with the Rights Agent, and with each
     transfer agent for the Preferred Stock and the Common Stock, a copy of such
     certificate and (c) if a Distribution Date has occurred, mail a brief
     summary thereof to each holder of a Rights Certificate in accordance with
     Section 27 hereof. The Rights Agent shall be fully protected in relying on
     any such certificate and on any adjustment therein contained.

               Section 13.  CONSOLIDATION, MERGER OR SALE OR
     TRANSFER OF ASSETS, CASH FLOW OR EARNING POWER.

                    (a) In the event that, following the Stock Acquisition Date,
     directly or indirectly, (x) the Company shall consolidate with, or merge
     with and into, any other Person (other than a Subsidiary of the Company in
     a transaction which complies with Section 11(o) hereof), and the Company
     shall not be the continuing or surviving corporation of such consolidation
     or merger, (y) any Person (other than a Subsidiary of the Company in a
     transaction which complies with Section 11(o) hereof) shall consolidate
     with, or merge with or into, the Company, and the Company shall be the
     continuing or surviving corporation of such consolidation or merger and, in
     connection with such consolidation or merger, all or part of the
     outstanding shares of Common Stock shall be changed into or exchanged for
     stock or other securities of any other Person or cash or any other
     property, or (z) the Company shall sell or otherwise transfer (or one or

                                       32
<PAGE>

     more of its Subsidiaries shall sell or otherwise transfer), in one
     transaction or a series of related transactions, assets, cash flow or
     earning power aggregating more than 50% of the assets, cash flow or earning
     power of the Company and its Subsidiaries (taken as a whole) to any Person
     or Persons (other than the Company or any Subsidiary of the Company in one
     or more transactions each of which complies with Section 11(o) hereof),
     then, and in each such case (except as may be contemplated by Section 13(d)
     hereof), proper provision shall be made so that: (i) 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 the then current Purchase
     Price in accordance with the terms of this Agreement, such number of
     validly authorized and issued, fully paid, non-assessable and freely
     tradeable shares of Common Stock of the Principal Party (as such term is
     hereinafter defined), not subject to any liens, encumbrances, rights of
     first refusal or other adverse claims, as shall be equal to the result
     obtained by (1) multiplying the then current Purchase Price by the number
     of one one-hundredths of a share of Preferred Stock for which a Right is
     exercisable immediately prior to the first occurrence of a Section 13 Event
     (or, if a Section 11(a)(ii) Event has occurred prior to the first
     occurrence of a Section 13 Event, multiplying the number of such one
     one-hundredths of a share for which a Right was exercisable immediately
     prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase
     Price in effect immediately prior to such first occurrence), and dividing
     that product (which, following the first occurrence of a Section 13 Event,
     shall be referred to as the "Purchase Price" for each Right and for all
     purposes of this Agreement) by (2) 50% of the Current Market Price
     (determined pursuant to Section 11(d)(i) hereof) per share of the Common
     Stock of such Principal Party on the date of consummation of such Section
     13 Event; (ii) 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; (iii) 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; (iv) such Principal Party shall take such steps (including, but not
     limited to, the reservation of a sufficient number of

                                       33
<PAGE>

     shares of its Common Stock) in connection with the consummation of any such
     transaction as may be necessary to assure that the provisions hereof shall
     thereafter be applicable, as nearly as reasonably may be, in relation to
     its shares of Common Stock thereafter deliverable upon the exercise of the
     Rights; and (v) the provisions of Section 11(a)(ii) hereof shall be of no
     effect following the first occurrence of any Section 13 Event.

                    (b) "Principal Party" shall mean:

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

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

     PROVIDED, HOWEVER, that in any such case, (1) if the Common Stock of such
     Person is not at such time and has not been continuously over the preceding
     twelve (12) month period registered under Section 12 of the Exchange Act,
     and such Person is a direct or indirect Subsidiary of another Person the
     Common Stock of which is and has been so registered, "Principal Party"
     shall refer to such other Person; and (2) in case such Person is a
     Subsidiary, directly or indirectly, of more than one Person, the Common
     Stocks of two or more of which are and have been so registered, "Principal
     Party" shall refer to whichever of such Persons is the issuer of the Common
     Stock having the greatest aggregate market value.

                    (c) The Company shall not consummate any such consolidation,
     merger, sale or transfer unless the Principal Party shall have a sufficient
     number of authorized shares of its Common Stock which have not been issued
     or reserved for issuance to permit the exercise in

                                       34
<PAGE>

     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 providing for the
     terms set forth in paragraphs (a) and (b) of this Section 13 and further
     providing that, as soon as practicable after the date of any consolidation,
     merger or sale of assets mentioned in paragraph (a) of this Section 13, the
     Principal Party will

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

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

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

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

                                       35
<PAGE>

                    (d) Notwithstanding anything in this Agreement to the
     contrary, Section 13 shall not be applicable to a transaction described in
     subparagraphs (x) and (y) of Section 13(a) if (i) such transaction is
     consummated with a Person or Persons who acquired shares of Common Stock
     pursuant to a tender offer or exchange offer for all outstanding shares of
     Common Stock which is a Qualified Offer as such term is defined in Section
     11(a)(ii) hereof (or a wholly owned subsidiary of any such Person or
     Persons), (ii) the price per share of Common Stock offered in such
     transaction is not less than the price per share of Common Stock paid to
     all holders of shares of Common Stock whose shares were purchased pursuant
     to such tender offer or exchange offer and (iii) the form of consideration
     being offered to the remaining holders of shares of Common Stock pursuant
     to such transaction is the same as the form of consideration paid pursuant
     to such tender offer or exchange offer. Upon consummation of any such
     transaction contemplated by this Section 13(d), all Rights hereunder shall
     expire.

               Section 14.  Fractional Rights and Fractional Shares.

                    (a) The Company shall not be required to issue fractions
     of Rights, except prior to the Distribution Date as provided in Section
     11(p) hereof, or to distribute Rights Certificates which represent
     fractional Rights. In lieu of such fractional Rights, the Company shall
     pay to the registered holders of the Rights Certificates with regard to
     which such fractional Rights would otherwise be issuable, an amount in
     cash equal to the same fraction of the current market value of a whole
     Right. For purposes of this Section 14(a), the current market value of a
     whole Right shall be the closing price of the Rights for the Trading Day
     immediately prior to the date on which such fractional Rights would have
     been otherwise issuable. The closing price of the Rights for any day
     shall be the last sale price, regular way, or, in case no such sale
     takes place on such day, the average of the closing bid and asked
     prices, regular way, in either case as reported in the principal
     consolidated transaction reporting system with respect to securities
     listed or admitted to trading on the New York Stock Exchange or, if the
     Rights are not listed or admitted to trading on the New York Stock
     Exchange, as reported in the principal

                                       36
<PAGE>

     consolidated transaction reporting system with respect to securities
     listed on the principal national securities exchange on which the Rights
     are listed or admitted to trading, or if the Rights are not listed or
     admitted to trading on any national securities exchange, the last quoted
     price or, if not so quoted, the average of the high bid and low asked
     prices in the over-the-counter market, as reported by NASDAQ or such
     other system then in use or, if on any such date the Rights are not
     quoted by any such organization, the average of the closing bid and
     asked prices as furnished by a professional market maker making a market
     in the Rights, selected by the Board of Directors of the Company. If on
     any such date no such market maker is making a market in the Rights, the
     fair value of the Rights on such date as determined in good faith by the
     Board of Directors of the Company shall be used.

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

                    (c) Following the occurrence of a Triggering Event, the
     Company shall not be required to issue fractions of shares of Common Stock
     upon exercise of the Rights or to distribute certificates which represent
     fractional shares of Common Stock. In lieu of fractional shares of Common
     Stock, the Company may pay to the registered holders of Rights Certificates
     at the time such

                                       37
<PAGE>

     Rights are exercised as herein provided an amount in cash equal to the same
     fraction of the current market value of one (1) share of Common Stock. For
     purposes of this Section 14(c), the current market value of one share of
     Common Stock shall be the closing price of one share of Common Stock (as
     determined pursuant to Section 11(d)(i) hereof) for the Trading Day
     immediately prior to the date of such exercise.

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

               Section 15. RIGHTS OF ACTION. All rights of action in respect of
     this Agreement are vested in the respective registered holders of the
     Rights Certificates (and, prior to the Distribution Date, the registered
     holders of the Common Stock); and any registered holder of any Rights
     Certificate (or, prior to the Distribution Date, of the Common Stock),
     without the consent of the Rights Agent or of the holder of any other
     Rights Certificate (or, prior to the Distribution Date, of the Common
     Stock), may, in his own behalf and for his own benefit, enforce, and may
     institute and maintain any suit, action or proceeding against the Company
     to enforce, or otherwise act in respect of, his right to exercise the
     Rights represented 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 of this Agreement and shall be
     entitled to specific performance of the obligations hereunder and
     injunctive relief against actual or threatened violations of the
     obligations hereunder of any Person subject to this Agreement.

               Section 16. AGREEMENT OF RIGHTS HOLDERS. Every 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 Common Stock;

                                       38
<PAGE>

                    (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 fully executed;

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

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

               Section 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER.
     No holder, as such, of any Rights Certificate shall be entitled to vote,
     receive dividends or be deemed for any purpose the holder of the number of
     one one-hundredths of a share of Preferred Stock or any other securities of
     the Company which may at any time be issuable on the exercise of the Rights
     represented thereby, nor shall anything contained herein or in any

                                       39
<PAGE>

     Rights Certificate be construed to confer upon the holder of any Rights
     Certificate, as such, any of the rights of a stockholder of the Company or
     any right to vote for the election of directors or upon any matter
     submitted to stockholders at any meeting thereof, or to give or withhold
     consent to any corporate action, or to receive notice of meetings or other
     actions affecting stockholders (except as provided in Section 25 hereof),
     or to receive dividends or subscription rights, or otherwise, until the
     Right or Rights evidenced by such Rights Certificate shall have been
     exercised in accordance with the provisions hereof.

               Section 18.  CONCERNING THE RIGHTS AGENT.

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

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

                                       40
<PAGE>

               Section 19.  MERGER OR CONSOLIDATION OR CHANGE OF
     NAME OF RIGHTS AGENT.

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

                    (b) In case at any time the name of the Rights Agent shall
     be changed and at such time any of the Rights Certificates shall have been
     countersigned but not delivered, the Rights Agent may adopt the
     countersignature 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. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes
     the duties and obligations imposed by this Agreement upon the following
     terms and

                                      41

<PAGE>

     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), and the opinion of such counsel shall be
     full and complete authorization and protection to the Rights Agent as to
     any action taken or omitted by it in good faith and in accordance with such
     opinion.

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

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

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

                    (e) The Rights Agent shall not be under any responsibility
     in respect of the validity of this Agreement or the execution and delivery
     hereof (except the due execution hereof by the Rights Agent) or in

                                      42

<PAGE>

     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 adjustment
     required under the provisions of Section 11, Section 13 or Section 24
     hereof or responsible for the manner, method or amount of any such
     adjustment or the ascertaining of the existence of facts that would require
     any such adjustment (except with respect to the exercise of Rights
     represented by Rights Certificates after actual notice of any such
     adjustment); nor shall it by any act hereunder be deemed to make any
     representation or warranty as to the authorization or reservation of any
     shares of Common Stock or Preferred Stock to be issued pursuant to this
     Agreement or any Rights Certificate or as to whether any shares of Common
     Stock or Preferred Stock will, when so issued, be validly authorized and
     issued, fully paid and nonassessable.

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

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

                    (h) The Rights Agent and any stockholder, director, officer
     or employee of the Rights Agent may buy, sell or deal in any of the Rights
     or other securities of the Company or become pecuniarily interested in any
     transaction in which the Company may be interested, or contract with or
     lend money to the Company or otherwise act as fully and freely as though it
     were not Rights

                                       43
<PAGE>

     Agent under this Agreement. Nothing herein shall preclude the Rights Agent
     from acting in any other capacity for the Company or for any other legal
     entity.

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

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

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

               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 Common Stock and Preferred
     Stock, by registered or certified mail, and, if such resignation occurs
     after the Distribution Date, to the registered 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

                                       44

<PAGE>

     transfer agent of the Common Stock and Preferred Stock, by registered
     or certified mail, and, if such removal occurs after the Distribution Date,
     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 his Rights Certificate for inspection by
     the Company), then any registered holder of any Rights Certificate may
     apply to any court of competent jurisdiction for the appointment of a new
     Rights Agent. Any successor Rights Agent, whether appointed by the Company
     or by such a court, shall be a legal business entity organized and doing
     business under the laws of the United States or of the State of New York or
     of any other state of the United States, in good standing, having an office
     in the State of New York, which is authorized under such laws to exercise
     corporate trust or stock transfer or shareholder services powers and which
     has at the time of its appointment as Rights Agent a combined capital and
     surplus of at least $50,000,000 or (b) an affiliate of a legal business
     entity described in clause (a) of this sentence. After appointment, the
     successor Rights Agent shall be vested with the same powers, rights, duties
     and responsibilities as if it had been originally named as Rights Agent
     without further act or deed; but the predecessor Rights Agent shall deliver
     and transfer to the successor Rights Agent any property at the time held by
     it hereunder, and execute and deliver any further assurance, conveyance,
     act or deed necessary for the purpose. Not later than the effective date of
     any such appointment, the Company shall file notice thereof in writing with
     the predecessor Rights Agent and each transfer agent of the Common Stock
     and the Preferred Stock, and, if such appointment occurs after the
     Distribution Date, mail a notice thereof in writing to the 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.

                                       45
<PAGE>

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

               Section 23.  REDEMPTION AND TERMINATION.

                    (a) The Company may, at its option, at any time prior to the
     earlier of (i) the close of business on the tenth day following the Stock
     Acquisition Date (or, if the Stock Acquisition Date shall have occurred
     prior to the Record Date, the close of business on the tenth day following
     the Record Date), or (ii) the Final Expiration Date, redeem all but not
     less than all of the then outstanding Rights at a redemption price of $.01
     per Right, as such amount may be appropriately adjusted to reflect any
     stock split, stock dividend or similar transaction occurring after the date
     hereof (such

                                       46
<PAGE>

     redemption price being hereinafter referred to as the "Redemption Price").
     Notwithstanding anything contained in this Agreement to the contrary, the
     Rights shall not be exercisable after the first occurrence of a Section
     11(a)(ii) Event until such time as the Company's right of redemption
     hereunder has expired. The Company may, at its option, pay the Redemption
     Price in cash, shares of Common Stock (based on the Current Market Price,
     as defined in Section 11(d)(i) hereof, of the Common Stock at the time of
     redemption) or any other form of consideration deemed appropriate by the
     Board of Directors.

                    (b) Immediately upon the action of the Board of Directors of
     the Company authorizing the redemption of the Rights, evidence of which
     shall have been filed with the Rights Agent and without any further action
     and without any notice, the right to exercise the Rights will terminate and
     the only right thereafter of the holders of Rights shall be to receive the
     Redemption Price for each Right so held. Promptly after the action of the
     Board of Directors authorizing 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
     each holder's last address as it appears upon the registry books of the
     Rights Agent or, prior to the Distribution Date, on the registry books of
     the transfer agent for the Common Stock. Any notice which is mailed in the
     manner herein provided shall be deemed given, whether or not the holder
     receives the notice. Each such notice of redemption will state the method
     by which the payment of the Redemption Price will be made.

               Section 24.  EXCHANGE.

                    (a) The Company may, at its option, at any time after any
     Person becomes an Acquiring Person, 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 Stock at an exchange ratio of one share of Common Stock per Right,
     appropriately adjusted to reflect any stock split, stock dividend or
     similar transaction occurring after the date hereof (such exchange ratio
     being hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
     foregoing, the

                                       47
<PAGE>

     Company 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 Stock 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 Stock then outstanding.

                    (b) Immediately upon the action of the Board of Directors of
     the Company authorizing the exchange of any Rights pursuant to subsection
     (a) of this Section 24 and without any further action and without any
     notice, the right to exercise such Rights shall terminate and the only
     right thereafter of a holder of such Rights shall be to receive that number
     of shares of Common Stock equal to the number of such Rights held by such
     holder multiplied by the Exchange Ratio. The Company shall promptly give
     public notice of any such exchange; PROVIDED, HOWEVER, that the failure to
     give, or any defect in, such notice shall not affect the validity of such
     exchange. The Company promptly 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 Stock for Rights will be effected and, in
     the event of any partial exchange, the number of Rights which will be
     exchanged. Any partial exchange shall be effected pro rata based on the
     number of Rights (other than Rights which have become void pursuant to the
     provisions of Section 7(e) hereof) held by each holder of Rights.

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

                                       48
<PAGE>

                    (d) In the event that there shall not be sufficient shares
     of Common Stock issued but not outstanding or authorized but unissued to
     permit any exchange of Rights as contemplated in accordance with this
     Section 24, the Company shall take all such action as may be necessary to
     authorize additional shares of Common Stock for issuance upon exchange of
     the Rights.

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

               Section 25.  NOTICE OF CERTAIN EVENTS.

                    (a) In case the Company shall propose, at any time after the
     Distribution Date, (i) to pay any dividend payable in stock of any class to
     the holders of Preferred Stock or to make any other distribution to the
     holders of Preferred Stock (other than a regular quarterly cash dividend
     out of earnings or retained earnings of the Company), or (ii) to offer to
     the holders of Preferred Stock rights or warrants to subscribe for or to
     purchase any additional shares of Preferred Stock or shares of stock of any
     class or any other securities, rights or options, or (iii) to effect any
     reclassification of its Preferred Stock (other than a reclassification
     involving only the subdivision of outstanding shares of Preferred Stock),
     or (iv) to effect any consolidation or merger into or with any other Person
     (other than a Subsidiary of the Company in a transaction which complies
     with Section 11(o) hereof), or to effect any sale or other transfer (or to
     permit one or more of its Subsidiaries to effect any sale or other
     transfer), in one transaction or a series of related transactions, of more

                                       49
<PAGE>

     than 50% of the assets, cash flow or earning power of the Company and its
     Subsidiaries (taken as a whole) to any other Person or Persons (other than
     the Company and/or any of its Subsidiaries in one or more transactions each
     of which complies with Section 11(o) hereof), or (v) to effect the
     liquidation, dissolution or winding up of the Company, then, in each such
     case, the Company shall give to each holder of a Rights Certificate, to the
     extent feasible and in accordance with Section 26 hereof, a notice of such
     proposed action, which shall specify the record date for the purposes of
     such stock dividend, distribution of rights or warrants, or the date on
     which such reclassification, consolidation, merger, sale, transfer,
     liquidation, dissolution, or winding up is to take place and the date of
     participation therein by the holders of the shares of Preferred Stock, if
     any such date is to be fixed, and such notice shall be so given in the case
     of any action covered by clause (i) or (ii) above at least twenty (20) days
     prior to the record date for determining holders of the shares of Preferred
     Stock for purposes of such action, and in the case of any such other
     action, at least twenty (20) days prior to the date of the taking of such
     proposed action or the date of participation therein by the holders of the
     shares of Preferred Stock whichever shall be the earlier.

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

               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 by the Rights Agent with the Company) as
     follows:

                                       50
<PAGE>

               Alexandria Real Estate Equities, Inc.
               135 N. Los Robles Ave., Suite 250
               Pasadena, CA  91101
               (626) 578-0777
               (626) 578-0770 (facsimile)
               Attention: Corporate Secretary

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

               American Stock Transfer & Trust Company
               40 Wall Street
               New York, NY  10005
               Attention:  Corporate Trust Department
               Stock Transfer Administration

               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 (or, if prior to the Distribution Date, to the holder of
     certificates representing shares of Common Stock) 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 Distribution
     Date, and subject to the penultimate sentence of this Section 27, the
     Company and the Rights Agent shall, if the Company so directs, supplement
     or amend any provision of this Agreement without the approval of any
     holders of shares of Common Stock. From and after the Distribution Date,
     the Company and the Rights Agent shall, if the Company so directs,
     supplement or amend this Agreement without the approval of any holders of
     Rights in order (i) to cure any ambiguity, (ii) to correct or supplement
     any provision contained herein which may be defective or inconsistent with
     any other provisions herein, (iii) to shorten or lengthen any time period
     hereunder, or (iv) to change or supplement

                                       51
<PAGE>

     the provisions hereunder in any manner which the Company may deem necessary
     or desirable and which 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.
     Upon the delivery of a certificate from an appropriate officer of the
     Company which 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 Stock. Notwithstanding anything herein
     to the contrary, this Agreement may not be amended at a time when the
     Rights are not redeemable.

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

               Section 29. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS,
     ETC. For all purposes of this Agreement, any calculation of the number of
     shares of Common Stock outstanding at any particular time, including for
     purposes of determining the particular percentage of such outstanding
     shares of Common Stock of which any Person is the Beneficial Owner, shall
     be made in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the
     General Rules and Regulations under the Exchange Act. The Board of
     Directors of the Company shall have the exclusive power and authority to
     administer this Agreement and to exercise all rights and powers
     specifically granted to the Board or to the Company, or as may be necessary
     or advisable in the administration of this Agreement, including, without
     limitation, the right and power to (i) interpret the provisions of this
     Agreement, and (ii) make

                                       52
<PAGE>

     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 and all other
     parties, and (y) not subject the Board or any of the directors on the Board
     to any liability to the holders of the Rights.

               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(and, prior to the
     Distribution Date, registered holders of the Common Stock) any legal or
     equitable right, remedy or claim under this Agreement; but this Agreement
     shall be for the sole and exclusive benefit of the Company, the Rights
     Agent and the registered holders of the Rights(and, prior to the
     Distribution Date, registered holders of the Common Stock).

               Section 31. SEVERABILITY. If any term, provision, covenant or
     restriction of this Agreement is held by a court of competent jurisdiction
     or other authority to be invalid, void or unenforceable, the remainder of
     the terms, provisions, covenants and restrictions of this Agreement shall
     remain in full force and effect and shall in no way be affected, impaired
     or invalidated; PROVIDED, HOWEVER, that notwithstanding anything in this
     Agreement to the contrary, if any such term, provision, covenant or
     restriction is held by such court or authority to be invalid, void or
     unenforceable and the Board of Directors of the Company determines in its
     good faith judgment that severing the invalid language from this Agreement
     would adversely affect the purpose or effect of this Agreement, the right
     of redemption set forth in Section 23 hereof shall be reinstated and shall
     not expire until the close of business on the tenth day following the date
     of such determination by the Board of Directors. Without limiting the
     foregoing, if any provision requiring a specific group of Directors of the
     Company to act is held to by

                                       53
<PAGE>

     any court of competent jurisdiction or other authority to be invalid, void
     or unenforceable, such determination shall then be made by the Board of
     Directors of the Company in accordance with applicable law and the
     Company's charter and Bylaws, as then in effect.

          Section 32. GOVERNING LAW. This Agreement, each Right and each Rights
     Certificate issued hereunder shall be deemed to be a contract made under
     the laws of the State of Maryland and for all purposes shall be governed by
     and construed in accordance with the laws of such State applicable to
     contracts made and to be performed entirely within such State, except that
     the rights and obligations of the Rights Agent shall be governed by the
     laws of the State of New York.

               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.

               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.

                                       54

<PAGE>

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

     Attest:                       ALEXANDRIA REAL ESTATE
                                      EQUITIES, INC.

     By:  /s/  Laurie A. Allen          By:  /s/ Peter J. Nelson
         ---------------------        --------------------------
        Name:  Laurie A. Allen          Name:  Peter J. Nelson
        Title:  Secretary               Title:  Chief Financial
                                        Officer and Senior Vice
                                        President

     Attest:                       AMERICAN STOCK TRANSFER &
                                      TRUST COMPANY

     By: /s/ Susan Silber                 By: /s/ Herbert J. Lemmer
         ---------------------                --------------------------
         Name:  Susan Silber                  Name:  Herbert J. Lemmer
         Title: Assistant Secretary           Title: Vice President

                                       55
<PAGE>

                                                                       EXHIBIT A

                    ALEXANDRIA REAL ESTATE EQUITIES, INC.

                             ARTICLES SUPPLEMENTARY

                SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

     ALEXANDRIA REAL ESTATE EQUITIES, INC., a Maryland corporation (the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:

     FIRST: Under a power contained in Article VI, Section 6.3, of the charter
of the Corporation (the "Charter"), the Board of Directors of the Corporation
(the "Board of Directors"), by resolution duly adopted, classified and
designated 500,000 shares (the "Shares") of Preferred Stock (as defined in the
Charter) as shares of Series A Junior Participating Preferred Stock, $.01 par
value per share (the "Series A Junior Participating Preferred Stock"), with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends and other distributions, qualifications and terms
and conditions of redemption, subject in all cases to the provisions of Article
VII of the Charter, as set forth as follows, which upon any restatement of the
Charter shall be made part of Article VI, with any necessary or appropriate
changes to the enumeration or lettering of sections or subsections hereof. The
classification increases the number of shares classified as Series A Junior
Participating Preferred Stock from no shares immediately prior to the
classification to 500,000 shares immediately after the classification. The
classification decreases the number of shares of unclassified Preferred Stock
from 98,390,000 shares immediately prior to the classification to 97,890,000
shares immediately after the classification.

     SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

               Section 1. DESIGNATION AND AMOUNT. The shares of such series
shall be classified and designated as "Series A Junior Participating
Preferred Stock" and the

<PAGE>

number of shares constituting such series shall be 500,000.

         Section 2. DIVIDENDS AND DISTRIBUTIONS.

         (A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the shares
of Series A Junior Participating Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Participating Preferred Stock shall be
entitled to receive, when, as and if authorized and declared by the Board of
Directors out of funds legally available for the purpose, quarterly dividends
payable in cash on or before the fifteenth (15th) 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 Junior Participating Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $.01 or (b) subject to the
provision for adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock, par value $.01 per share, of the Corporation (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 Junior Participating Preferred
Stock. In the event the Corporation shall at any time after February 4, 2000
(the "Rights Declaration Date") (i) declare any dividend on Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A Junior
Participating Preferred Stock were entitled immediately prior to such event
under clause (b) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of Common
Stock outstanding

                                     A - 2
<PAGE>

immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.

         (B) The Corporation may not declare or pay a dividend or distribution
on the Common Stock (other than a dividend payable in shares of the Common
Stock) unless it simultaneously declares and pays a dividend or distribution on
the Series A Junior Participating Preferred Stock as provided in Paragraph (A)
above; provided that, in the event no dividend payable in shares of or
distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $.01 per share on the Series A Junior
Participating Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.

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

                                     A - 3
<PAGE>

         Section 3. VOTING RIGHTS. The holders of shares of Series A Junior
Participating Preferred Stock shall have the following voting rights:

         (A) Subject to the provision for adjustment hereinafter set forth, each
share of Series A Junior Participating Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the holders of Common
Stock of the Corporation. In the event the Corporation shall at any time after
the Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the number of votes per share to which holders of shares of
Series A Junior Participating Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying such number by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.

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

                  (C) (i) If at any time dividends on any Series A Junior
         Participating Preferred Stock shall be in arrears in an amount equal to
         six (6) quarterly dividends thereon, the occurrence of such contingency
         shall mark the beginning of a period (herein called a "default period")
         which shall extend until such time when all accrued and unpaid
         dividends for all previous quarterly dividend periods and for the
         current quarterly dividend period on all shares of Series A Junior
         Participating Preferred Stock then outstanding shall have been declared
         and paid or set apart for payment. During each default period, all
         holders of Preferred Stock (including holders of the Series A Junior
         Participating Preferred Stock) with dividends in

                                     A - 4
<PAGE>

          arrears in an amount equal to six (6) quarterly dividends thereon,
          voting as a class, irrespective of series, shall have the right to
          elect two (2) directors.

                    (ii) During any default period, such voting right of the
          holders of Series A Junior Participating Preferred Stock may be
          exercised initially at a special meeting called pursuant to
          subparagraph (iii) of this Section 3(C) or at any annual meeting of
          stockholders, and thereafter at annual meetings of stockholders,
          provided that neither such voting right nor the right of the holders
          of any other series of Preferred Stock, if any, to increase in certain
          cases the authorized number of directors shall be exercised unless the
          holders of ten percent (10%) in number of shares of Series A Junior
          Participating Preferred Stock outstanding shall be present in person
          or by proxy. The absence of a quorum of the holders of Common Stock
          shall not affect the exercise by the holders of Series A Junior
          Participating Preferred Stock of such voting right. At any meeting at
          which the holders of Series A Junior Participating Preferred Stock
          shall exercise such voting right initially during an existing default
          period, they shall have the right, voting as a class, to elect
          directors to fill such vacancies, if any, in the Board of Directors as
          may then exist up to two (2) directors or, if such right is exercised
          at an annual meeting, to elect two (2) directors. If the number which
          may be so elected at any special meeting does not amount to the
          required number, the holders of the Series A Junior Participating
          Preferred Stock shall have the right to make such increase in the
          number of directors as shall be necessary to permit the election by
          them of the required number. After the holders of the Series A Junior
          Participating Preferred Stock shall have exercised their right to
          elect directors in any default period and during the continuance of
          such period, the number of directors shall not be increased or
          decreased except by vote of the holders of Series A Junior
          Participating Preferred Stock as herein provided or pursuant to the
          rights of any equity securities ranking senior to or PARI PASSU

                                     A - 5
<PAGE>

          with the Series A Junior Participating Preferred Stock.

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

                    (iv) In any default period, the holders of Common Stock, and
          other classes of stock of the Corporation if applicable, shall
          continue to be entitled to elect the whole number of directors until
          the holders of Series A Junior Participating Preferred Stock shall
          have exercised their right to elect two (2) directors voting as a
          class, after the exercise

                                     A - 6
<PAGE>

          of which right (x) the directors so elected by the holders of Series A
          Junior Participating Preferred Stock shall continue in office until
          their successors shall have been elected by such holders or until the
          expiration of the default period, and (y) any vacancy in the Board of
          Directors may (except as provided in Paragraph (C)(ii) of this Section
          3) be filled by vote of a majority of the remaining directors
          theretofore elected by the holders of the class of stock which elected
          the director whose office shall have become vacant. References in this
          Paragraph (C) to directors elected by the holders of a particular
          class of stock shall include directors elected by such directors to
          fill vacancies as provided in clause (y) of the foregoing sentence.

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

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

               Section 4.  CERTAIN RESTRICTIONS.

               (A) Whenever quarterly dividends or other dividends or
     distributions payable on the Series A Junior

                                     A - 7
<PAGE>

     Participating Preferred Stock as provided in Section 2 are in arrears,
     thereafter and until all accrued and unpaid dividends and distributions,
     whether or not declared, on shares of Series A Junior Participating
     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 Junior Participating Preferred Stock;

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

                         (iii) redeem or purchase or otherwise acquire for
          consideration shares of any stock ranking on a parity (either as to
          dividends or upon liquidation, dissolution or winding up) with the
          Series A Junior Participating 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 Junior
          Participating Preferred Stock; or

                         (iv) purchase or otherwise acquire for consideration
          any shares of Series A Junior Participating Preferred Stock, or any
          shares of stock ranking on a parity with the Series A Junior
          Participating Preferred Stock, except in accordance with a purchase
          offer made in writing or by publication (as determined by the Board of
          Directors) to all holders of such

                                     A - 8
<PAGE>

          shares upon such terms as the Board of Directors, after consideration
          of the respective annual dividend rates and other relative rights and
          preferences of the respective series and classes, shall determine in
          good faith will result in fair and equitable treatment among the
          respective series or classes.

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

               Section 5. REACQUIRED SHARES. Any shares of Series A Junior
     Participating Preferred Stock purchased or otherwise acquired by the
     Corporation in any manner whatsoever shall 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.

               Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP. (A) Upon any
     liquidation (voluntary or otherwise), dissolution or winding up of the
     Corporation, no distribution shall be made to the holders of shares of
     stock ranking junior (either as to dividends or upon liquidation,
     dissolution or winding up) to the Series A Junior Participating Preferred
     Stock unless, prior thereto, the holders of shares of Series A Junior
     Participating Preferred Stock shall have received an amount equal to $100
     per share of Series A Junior Participating Preferred Stock, plus an amount
     equal to accrued and unpaid dividends and distributions thereon, whether or
     not declared, to the date of such payment (the "Series A Liquidation
     Preference"). Following the payment of the full amount of the Series A
     Liquidation Preference, no additional distributions shall be made to the
     holders of shares of Series A Junior Participating Preferred Stock unless,
     prior thereto, the holders of shares of Common Stock shall have received an
     amount per share (the "Common Adjustment") equal to the quotient obtained
     by dividing (i) the Series A Liquidation Preference by (ii) 100 (as
     appropriately adjusted as set forth in subparagraph (C) below to reflect
     such events as stock splits, stock

                                     A - 9
<PAGE>

     dividends and recapitalizations with respect to the Common Stock) (such
     number in clause (ii), the "Adjustment Number"). Following the payment of
     the full amount of the Series A Liquidation Preference and the Common
     Adjustment in respect of all outstanding shares of Series A Junior
     Participating Preferred Stock and Common Stock, respectively, holders of
     Series A Junior Participating Preferred Stock and holders of shares of
     Common Stock shall receive their ratable and proportionate share of the
     remaining assets to be distributed in the ratio of the Adjustment Number to
     1 with respect to such Preferred Stock and Common Stock, on a per share
     basis, respectively.

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

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

               (D) In determining whether a distribution (other than upon
     voluntary or involuntary liquidation) by dividend, redemption or other
     acquisition of shares of stock of the Corporation or otherwise is permitted
     under the Maryland General Corporation Law, no effect shall be given to
     amounts that would be needed, if the Corporation were to be dissolved at
     the time of the distribution, to

                                     A - 10
<PAGE>

     satisfy the preferential rights upon dissolution of holders of shares of
     stock of the Company whose preferential rights upon dissolution are
     superior to those receiving the distribution.

               Section 7. CONSOLIDATION, MERGER, ETC. In case the Corporation
     shall enter into any consolidation, merger, combination or other
     transaction in which the shares of Common Stock are exchanged for or
     changed into other stock or securities, cash and/or any other property,
     then in any such case the shares of Series A Junior Participating Preferred
     Stock shall at the same time be similarly exchanged or changed in an amount
     per share (subject to the provision for adjustment hereinafter set forth)
     equal to 100 times the aggregate amount of stock, securities, cash and/or
     any other property (payable in kind), as the case may be, into which or for
     which each share of Common Stock is changed or exchanged. In the event the
     Corporation shall at any time after the Rights Declaration Date (i) declare
     any dividend on Common Stock payable in shares of Common Stock, (ii)
     subdivide the outstanding Common Stock, or (iii) combine the outstanding
     Common Stock into a smaller number of shares, then in each such case the
     amount set forth in the preceding sentence with respect to the exchange or
     change of shares of Series A Junior Participating Preferred Stock shall be
     adjusted by multiplying such amount by a fraction the numerator of which is
     the number of shares of Common Stock outstanding immediately after such
     event and the denominator of which is the number of shares of Common Stock
     that were outstanding immediately prior to such event.

               Section 8.  NO REDEMPTION.  The shares of Series A
     Junior Participating Preferred Stock shall not be redeemable.

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

               Section 10. AMENDMENT. At any time when any shares of Series A
     Junior Participating Preferred Stock

                                     A - 11
<PAGE>

     are outstanding, the Charter, including the terms of these Articles
     Supplementary, shall not be amended in any manner which would materially
     alter or change the powers, preferences or special rights of the Series A
     Junior Participating Preferred Stock so as to affect them adversely without
     the affirmative vote of the holders of a majority or more of the
     outstanding shares of Series A Junior Participating Preferred Stock, voting
     separately as a class.

               Section 11. FRACTIONAL SHARES. Series A Junior Participating
     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 Junior Participating
     Preferred Stock.

          SECOND:  The Shares have been classified and designated
     by the Board of Directors under the authority contained in
     the Charter.

          THIRD:  These Articles Supplementary have been approved
     by the Board of Directors in the manner and by the vote
     required by law.

          FOURTH: The undersigned Senior Vice President of the Corporation
     acknowledges these Articles Supplementary to be the corporate act of the
     Corporation and, as to all matters or facts required to be verified under
     oath, the undersigned Senior Vice President acknowledges that to the best
     of his knowledge, information and belief, these matters and facts are true
     in all material respects and that this statement is made under the
     penalties for perjury.

                                     A - 12
<PAGE>

         IN WITNESS WHEREOF, ALEXANDRIA REAL ESTATE EQUITIES, INC. has caused
these Articles Supplementary to be signed in its name and on its behalf by its
__________________ and attested to by its Secretary on ________________.

                                   ALEXANDRIA REAL ESTATE
                                   EQUITIES, INC.

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

Attest:

----------------------------------
Secretary

                                A-13
<PAGE>

                                                                       EXHIBIT B

                          [Form of Rights Certificate]

     Certificate No. R-                             ________ Rights

     NOT EXERCISABLE AFTER FEBRUARY 10, 2010 UNLESS EXTENDED PRIOR THERETO BY
     THE BOARD OF DIRECTORS OR EARLIER IF REDEEMED BY THE COMPANY. THE RIGHTS
     ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.01 PER RIGHT
     ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
     CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH
     TERM IS 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 AGREEMENT.]

                               Rights Certificate

                    ALEXANDRIA REAL ESTATE EQUITIES, INC.

               This certifies that , or registered assigns, is the registered
     owner of the number of Rights set forth above, each of which entitles the
     owner thereof, subject to the terms, provisions and conditions of the
     Rights Agreement, dated as of February 10, 2000 (the "Rights Agreement"),
     between Alexandria Real Estate Equities, Inc., a Maryland corporation (the
     "Company"), and American Stock Transfer & Trust Company, a New York
     corporation (the "Rights Agent"), to purchase from the Company at any time
     prior to 5:00 P.M. (New York City time) on February 10, 2010 (unless such
     date is extended prior thereto by the Board of Directors) at the
<PAGE>

     office or offices of the Rights Agent designated for such purpose, or its
     successors as Rights Agent, one one-hundredth of a fully paid,
     non-assessable share of Series A Junior Participating Preferred Stock (the
     "Preferred Stock") of the Company, at a purchase price of $120 per one
     one-hundredth of a share (the "Purchase Price"), upon presentation and
     surrender of this Rights Certificate with the Form of Election to Purchase
     and related Certificate duly executed. The number of Rights represented by
     this Rights Certificate (and the number of shares which may be purchased
     upon exercise thereof) set forth above, and the Purchase Price per share
     set forth above, are the number and Purchase Price as of February 4, 2000,
     based on the Preferred Stock as constituted at such date. The Company
     reserves the right to require prior to the occurrence of a Triggering Event
     (as such term is defined in the Rights Agreement) that a number of Rights
     be exercised so that only whole shares of Preferred Stock will be issued.

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

               As provided in the Rights Agreement, the Purchase Price and the
     number and kind of shares of Preferred Stock or other securities, which may
     be purchased upon the exercise of the Rights represented by this Rights
     Certificate are subject to modification and adjustment upon the happening
     of certain events, including Triggering Events.

               This Rights Certificate is subject to all of the terms,
     provisions and conditions of the Rights Agreement, which terms, provisions
     and conditions are hereby incorporated herein by reference and made a part
     hereof and to which Rights Agreement reference is hereby made for a full
     description of the rights, limitations of

                                     B - 2
<PAGE>

     rights, obligations, duties and immunities hereunder of the Rights Agent,
     the Company and the holders of the Rights Certificates, which limitations
     of rights include the temporary suspension of the exercisability of such
     Rights under the specific circumstances set forth in the Rights Agreement.
     Copies of the Rights Agreement are on file at the above-mentioned office of
     the Rights Agent and are also available upon written request to the Rights
     Agent.

               This Rights Certificate, with or without other Rights
     Certificates, upon surrender at the principal office or offices of the
     Rights Agent designated for such purpose, may be exchanged for another
     Rights Certificate or Rights Certificates of like tenor and date
     representing Rights entitling the holder to purchase a like aggregate
     number of one one-hundredths of a share of Preferred Stock as the Rights
     represented 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
     representing the number of whole Rights not exercised.

               Subject to the provisions of the Rights Agreement, the Rights
     represented by this Certificate may be redeemed by the Company at its
     option at a redemption price of $.01 per Right at any time prior to the
     earlier of the close of business on (i) the tenth day following the Stock
     Acquisition Date (as such time period is defined and may be extended
     pursuant to the Rights Agreement), and (ii) the Final Expiration Date. In
     addition, under certain circumstances following the Stock Acquisition Date,
     the Rights may be exchanged, in whole or in part, for shares of the Common
     Stock, or shares of preferred stock of the Company having essentially the
     same value or economic rights as such shares. Immediately upon the action
     of the Board of Directors of the Company authorizing any such exchange, and
     without any further action or any notice, the Rights (other than Rights
     which are not subject to such exchange) will terminate and the Rights will
     only enable holders to receive the shares issuable upon such exchange.

               No fractional shares of Preferred Stock will be issued upon the
     exercise of any Right or Rights represented hereby (other than fractions
     which are integral multiples of one one-hundredth of a share of Preferred

                                     B - 3
<PAGE>

     Stock, which may, at the election of the Company, be represented by
     depositary receipts), but in lieu thereof a cash payment will be made, as
     provided in the Rights Agreement. The Company, at its election, may require
     that a number of Rights be exercised so that only whole shares of Preferred
     Stock would be issued.

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

                                     B - 4
<PAGE>

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

     ATTEST:                       ALEXANDRIA REAL ESTATE
                                   EQUITIES, INC.

                                   By
    ------------------------          -----------------------------
             Secretary                Title:

     Countersigned:

     AMERICAN STOCK TRANSFER & TRUST COMPANY

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

                                     B - 5
<PAGE>

                  [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)
     __________________________________________________________________________
     the Rights represented by this Rights Certificate, together with all right,
     title and interest therein, and does hereby irrevocably constitute and
     appoint __________________ as Agent to transfer the within Rights
     Certificate on the books of the within named Company, with full power of
     substitution.
     Dated:________________,______

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

     Signature Guaranteed:

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

                                     B - 6

<PAGE>

                                   CERTIFICATE

               The undersigned hereby certifies by checking the appropriate
     boxes that:

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

               (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 an Acquiring Person.

     Dated:                ,
            --------------- --------    ------------------------------
                                        Signature

     Signature Guaranteed:

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

                                     B - 7
<PAGE>

                                     NOTICE

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

                                     B - 8
<PAGE>

                          FORM OF ELECTION TO PURCHASE

                  (To be executed if holder desires to exercise
                 Rights represented by the Rights Certificate.)

     To:  ALEXANDRIA REAL ESTATE EQUITIES, INC.

               The undersigned hereby irrevocably elects to exercise
     _______________ Rights represented by this Rights Certificate to
     purchase the shares of Preferred Stock issuable upon the exercise of the
     Rights (or such other securities of the Company or of any other person
     which may be issuable upon the exercise of the Rights) and requests that
     certificates representing such shares be issued in the name of and
     delivered to:

     Please insert social security
     or other identifying number

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

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

               If such number of Rights shall not be all the Rights represented
     by this Rights Certificate, a new Rights Certificate representing the
     balance 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:

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

                                     B - 9
<PAGE>

                                  CERTIFICATE

               The undersigned hereby certifies by checking the appropriate
     boxes that:

               (1) the Rights represented 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 Acquiring Person
     (as such terms are defined pursuant to the Rights Agreement);

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

     Dated:
            --------------, -----        -----------------------------
                                         Signature

     Signature Guaranteed:

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

                                  B-10
<PAGE>

                                     NOTICE

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

                                B-11
<PAGE>

                                                                       EXHIBIT C

                          SUMMARY OF RIGHTS TO PURCHASE
                                 PREFERRED STOCK

               On February 4, 2000, the Board of Directors of Alexandria Real
     Estate Equities, Inc., (the "Company") authorized a dividend distribution
     of one Right for each authorized and outstanding share of common stock, par
     value $.01 per share, of the Company to stockholders of record at the close
     of business on February 24, 2000 (the "Record Date"). Each Right entitles
     the registered holder to purchase from the Company a unit consisting of one
     one-hundredth of a share (a "Unit") of Series A Junior Participating
     Preferred Stock, par value $.01 per share (the "Series A Preferred Stock")
     at a Purchase Price of $120 per Unit, subject to adjustment. The
     description and terms of the Rights are set forth in a Rights Agreement
     (the "Rights Agreement") between the Company and American Stock Transfer &
     Trust Company, as Rights Agent.

               Initially, the Rights will be attached to all Common Stock
     certificates representing shares then outstanding, and no separate Rights
     Certificates will be distributed. Subject to certain exceptions specified
     in the Rights Agreement, the Rights will separate from the Common Stock and
     a Distribution Date will occur upon the earlier of (i) 10 days following a
     public announcement that a person or group of affiliated or associated
     persons (an "Acquiring Person") has acquired beneficial ownership of 15% or
     more of the outstanding shares of Common Stock (the "Stock Acquisition
     Date"), other than as a result of repurchases of stock by the Company or
     certain inadvertent actions by institutional or certain other stockholders,
     or (ii) 10 business days (or such later date as the Board shall determine)
     following the commencement of a tender offer or exchange offer that would
     result in a person or group becoming an Acquiring Person. Until the
     Distribution Date, (i) the Rights will be represented by the Common Stock
     certificates and will be transferred with and only with such Common Stock
     certificates, (ii) new Common Stock certificates issued after the Record
     Date will contain a notation incorporating the Rights Agreement by
     reference and (iii) the surrender for transfer of any certificates for
     Common Stock outstanding will also constitute the transfer of the Rights
     associated with the Common Stock represented by such certificate. Pursuant
     to the Rights Agreement, the Company reserves the right to require prior to
     the occurrence of a Triggering Event (as defined below) that,

<PAGE>

     upon any exercise of Rights, a number of Rights be exercised so that only
     whole shares of Preferred Stock will be issued.

               The Rights are not exercisable until the Distribution Date and
     will expire at 5:00 P.M. (New York City time) on February 10, 2010, unless
     such date is extended or the Rights are earlier redeemed or exchanged by
     the Company as described below.

               As soon as practicable after the Distribution Date, Rights
     Certificates will be mailed to holders of record of the Common Stock as of
     the close of business on the Distribution Date and, thereafter, the
     separate Rights Certificates alone will represent the Rights. Except as
     otherwise determined by the Board of Directors, only shares of Common Stock
     issued prior to the Distribution Date will be issued with Rights.

               In the event that a Person becomes an Acquiring Person, except
     pursuant to an offer for all outstanding shares of Common Stock which the
     independent directors determine to be fair and not inadequate to, and to
     otherwise be in the best interests of, the Company and its stockholders,
     after receiving advice from one or more investment banking firms (a
     "Qualified Offer"), each holder of a Right will thereafter have the right
     to receive, upon exercise, in lieu of the fractional shares of Series A
     Preferred Stock, that number of shares of Common Stock (or, in certain
     circumstances, cash, property or other securities of the Company) having a
     value equal to two times the exercise price of the Right. Notwithstanding
     any of the foregoing, following the occurrence of the event set forth in
     this paragraph, all Rights that are, or (under certain circumstances
     specified in the Rights Agreement) were, beneficially owned by any
     Acquiring Person will be null and void. However, Rights are not exercisable
     following the occurrence of the event set forth above until such time as
     the Rights are no longer redeemable by the Company as set forth below.

               For example, at an exercise price of $120 per Right, each Right
     not owned by an Acquiring Person (or by certain related parties) following
     an event set forth in the preceding paragraph would entitle its holder to
     purchase $240 worth of Common Stock (or other consideration, as noted
     above) for $120. Assuming that the Common Stock had a per share value of
     $30 at such time, the holder of each valid Right would be entitled to
     purchase 8 shares of Common Stock for $120.

                                 C-2
<PAGE>

               In the event that, at any time following the Stock Acquisition
     Date, (i) the Company engages in a merger or other business combination
     transaction in which the Company is not the surviving corporation (other
     than with an entity which acquired the shares pursuant to a Qualified
     Offer), (ii) the Company engages in a merger or other business combination
     transaction in which the Company is the surviving corporation and the
     Common Stock of the Company is changed or exchanged, or (iii) 50% or more
     of the Company's assets, cash flow or earning power is sold or transferred,
     each holder of a Right (except Rights which have previously been voided as
     set forth above) shall thereafter have the right to receive, upon exercise,
     common stock of the acquiring company having a value equal to two times the
     exercise price of the Right. The events set forth in this paragraph and in
     the second preceding paragraph are referred to as the "Triggering Events."

               At any time after a person becomes an Acquiring Person and prior
     to the acquisition by such person or group of fifty percent (50%) or more
     of the outstanding Common Stock, the Company may exchange the Rights (other
     than Rights owned by such person or group which have become void), in whole
     or in part, at an exchange ratio of one share of Common Stock, or one
     one-hundredth of a share of Series A Preferred Stock (or of a share of a
     class or series of the Company's preferred stock having equivalent rights,
     preferences and privileges), per Right (subject to adjustment).

               At any time until ten days following the Stock Acquisition Date,
     the Company may redeem the Rights in whole, but not in part, at a price of
     $.01 per Right (payable in cash, Common Stock or other consideration deemed
     appropriate by the Board of Directors). Immediately upon the action of the
     Board of Directors authorizing redemption of the Rights, the Rights will
     terminate and the only right of the holders of Rights will be to receive
     the $.01 redemption price.

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

                                C-3
<PAGE>

               Any of the provisions of the Rights Agreement may be amended by
     the Board of Directors of the Company prior to the Distribution Date. After
     the Distribution Date, the provisions of the Rights Agreement may be
     amended by the Board in order to cure any ambiguity, to make changes which
     do not adversely affect the interests of holders of Rights, or to shorten
     or lengthen any time period under the Rights Agreement. The foregoing
     notwithstanding, no amendment may be made at such time as the Rights are
     not redeemable.

               A copy of the Rights Agreement has been filed with the Securities
     and Exchange Commission as an Exhibit to a Registration Statement on Form
     8-A dated February 10, 2000. A copy of the Rights Agreement is available
     free of charge from the Company. This summary description of the Rights
     does not purport to be complete and is qualified in its entirety by
     reference to the Rights Agreement, which is incorporated herein by
     reference.

                              C-4<PAGE>

                                SHOPNOW.COM INC.

                  AMENDED AND RESTATED 1999 NONOFFICER EMPLOYEE

                                STOCK OPTION PLAN

         1.       PURPOSES OF THE PLAN. The purposes of this 1999 Nonofficer
Employee Stock Option Plan are:

                  -   to attract and retain the best available personnel for
                      positions of substantial responsibility,

                  -   to provide additional incentive to certain Employees and
                      Consultants, and

                  -   to promote the success of the Company's business.

                  Awards granted under the Plan may be Stock Awards and
Nonstatutory Stock Options only.

         2. DEFINITIONS. As used herein, the following definitions shall apply:

                  (a) "Administrator" means the Board or any of its
Committees as shall be administering the Plan or one or more senior executive
officers authorized by the Board to grant Awards, in accordance with Section
4 of the Plan.

                  (b) "Applicable Laws" means the requirements relating to
the administration of stock option plans under U. S. state corporate laws,
U.S. federal and state securities laws, the Code, any stock exchange or
quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Awards are, or
will be, granted under the Plan.

                  (c) "Award" means an award or grant made pursuant to the
Plan, including, without limitation, awards or grants of Stock Awards and
Options, or any combination of the foregoing.

                  (d) "Board" means the Board of Directors of the Company.

                  (e) "Code" means the Internal Revenue Code of 1986, as
amended.

                  (f) "Committee" means a committee of Directors appointed by
the Board in accordance with Section 4 of the Plan.

                  (g) "Common Stock" means the common stock of the Company.

                  (h) "Company" means ShopNow.com Inc., a Washington
corporation.

                                     - 1 -

<PAGE>

                  (i) "Consultant" means any person, including an advisor,
engaged by the Company or a Parent or Subsidiary to render services to such
entity.

                  (j) "Director" means a member of the Board.

                  (k) "Disability" means total and permanent disability as
defined in Section 22(e)(3) of the Code.

                  (l) "Employee" means any person, including Officers and
Directors, employed by the Company or any Parent or Subsidiary of the
Company. A Service Provider shall not cease to be an Employee in the case of
(i) any leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any Subsidiary,
or any successor. Neither service as a Director nor payment of a director's
fee by the Company shall be sufficient to constitute "employment" by the
Company.

                  (m) "Exchange Act" means the Securities Exchange Act of
1934, as amended.

                  (n) "Fair Market Value" means, as of any date, the value of
Common Stock determined as follows:

                           (i) If the Common Stock is listed on any
established stock exchange or a national market system, including without
limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The
Nasdaq Stock Market, its Fair Market Value shall be the closing sales price
for such stock (or the closing bid, if no sales were reported) as quoted on
such exchange or system for the last market trading day prior to the time of
determination, as reported in THE WALL STREET JOURNAL or such other source as
the Administrator deems reliable;

                           (ii) If the Common Stock is regularly quoted by a
recognized securities dealer but selling prices are not reported, the Fair
Market Value of a Share of Common Stock shall be the mean between the high
bid and low asked prices for the Common Stock on the last market trading day
prior to the day of determination, as reported in THE WALL STREET JOURNAL or
such other source as the Administrator deems reliable; or

                           (iii) In the absence of an established market for
the Common Stock, the Fair Market Value shall be determined in good faith by
the Administrator.

                  (o) "INCENTIVE STOCK OPTION" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code and the regulations promulgated thereunder.

                  (p) "NONSTATUTORY STOCK OPTION" means an Option not
intended to qualify as an Incentive Stock Option.

                  (q) "NOTICE OF GRANT" means a written or electronic notice
evidencing certain terms and conditions of an individual Award grant. The
Notice of Grant is part of the Option or Stock Award Agreement.

                                     - 2 -

<PAGE>

                  (r) "OFFICER" means a person who is an officer of the
Company within the meaning of Section 16 of the Exchange Act and the rules
and regulations promulgated thereunder.

                  (s) "OPTION" means a Nonstatutory Stock Option granted
pursuant to the Plan.

                  (t) "OPTION AGREEMENT" means an agreement between the
Company and a Participant evidencing the terms and conditions of an
individual Option grant. The Option Agreement is subject to the terms and
conditions of the Plan.

                  (u) "OPTIONED STOCK" means the Common Stock subject to an
Option.

                  (v) "PARENT" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.

                  (w) "PARTICIPANT" means the holder of an outstanding Award
granted under the Plan.

                  (x) "PLAN" means this 1999 Nonofficer Employee Stock Option
Plan.

                  (y) "SERVICE PROVIDER" means an Employee or Consultant.

                  (z) "SHARE" means a share of the Common Stock, as adjusted
in accordance with Section 13 of the Plan.

                  (aa) "STOCK AWARD" means shares of Common Stock or units
denominated in Common Stock granted under Section 11, the rights of ownership
of which may be subject to restrictions prescribed by the Administrator.

                  (bb) "STOCK AWARD AGREEMENT" means an agreement between the
Company and a Participant evidencing the terms and conditions of an
individual Award grant. The Stock Award Agreement is subject to the terms and
conditions of the Plan.

                  (cc) "SUBSIDIARY" means a "subsidiary corporation," whether
now or hereafter existing, as defined in Section 424(f) of the Code.

         3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section
13 of the Plan, the maximum number of Shares which are available for issuance
under the Plan is

         (a) 2,500,000 Shares; plus

         (b) an automatic increase to be added on the first day of the fiscal
quarter beginning on January 1, 2000 equal to 10,000 Shares multiplied by the
number of individuals who began employment or services at the Company, a
Parent or a Subsidiary in the preceding fiscal quarter in connection with the
Company's acquisition of any corporation or business entity in such quarter;
plus

                                     - 3 -

<PAGE>

         (c) an automatic increase to be added on the first day of each month
beginning on or after March 1, 2000 equal to 10,000 Shares multiplied by the
number of individuals who began employment or services at the Company, a
Parent or a Subsidiary in the immediately preceding month;

provided, however, that the maximum number of Shares which may be issued
under the Plan may not exceed 4,000,000 Shares. The Shares may be authorized,
but unissued, or reacquired Common Stock.

                  No more than 30% of the Shares authorized for issuance
under the Plan may be issued to officers who are not subject to Section 16 of
the Exchange Act.

                  Any Shares that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or payment
of the Award to the extent it is exercised for or settled in vested and
nonforfeitable Shares) shall again be available for issuance in connection
with future grants of Awards under the Plan.

         4. ADMINISTRATION OF THE PLAN.

                  (a)      Procedure.

                           (i)     MULTIPLE ADMINISTRATIVE BODIES.  The Plan
may be administered by different Committees with respect to different groups
of Service Providers. In addition, to the extent consistent with applicable
law, the Board may authorize one or more senior executive officers to grant
Awards to specified classes of Service Providers, within the limits
specifically prescribed by the Board.

                           (ii)    OTHER ADMINISTRATION.  Other than as
provided above, the Plan shall be administered by (A) the Board or (B) a
Committee, which committee shall be constituted to satisfy Applicable Laws.

                  (b) POWERS OF THE ADMINISTRATOR. Subject to the provisions
of the Plan, and in the case of a Committee or executive officer, subject to
the specific duties delegated by the Board to such Committee or officer, the
Administrator shall have the authority, in its discretion:

                           (i)      to determine the Fair Market Value;

                           (ii)     to select the Service Providers to whom
Awards may be granted hereunder;

                           (iii)   to determine the number of shares of
Common Stock to be covered by each Award granted hereunder;

                           (iv)     to approve forms of agreement for use under
the Plan;

                           (v)      to determine the terms and conditions,
not inconsistent with the terms of the Plan, of any Award granted hereunder.
Such terms and conditions include, but are

                                     - 4 -
<PAGE>

not limited to, the exercise price, the time or times when Awards may be
exercised (which may be based on performance criteria), any vesting
acceleration or waiver of forfeiture restrictions, and any restriction or
limitation regarding any Award or the shares of Common Stock relating
thereto, based in each case on such factors as the Administrator, in its sole
discretion, shall determine;

                           (vi)     to construe and interpret the terms of
the Plan and Awards granted pursuant to the Plan;

                           (vii)    to prescribe, amend and rescind rules and
regulations relating to the Plan, including rules and regulations relating to
sub-plans established for the purpose of qualifying for preferred tax
treatment under foreign tax laws;

                           (viii)   to modify or amend each Award (subject to
Section 16(b) of the Plan), including the discretionary authority to extend
the post-termination exercisability period of Options longer than is
otherwise provided for in the Plan;

                           (ix)     to allow Participants to satisfy
withholding tax obligations by electing to have the Company withhold from the
Shares to be issued upon exercise of an Option or the grant of a Stock Award
that number of Shares having a Fair Market Value equal to the amount required
to be withheld. The Fair Market Value of the Shares to be withheld shall be
determined on the date that the amount of tax to be withheld is to be
determined. All elections by a Participant to have Shares withheld for this
purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable;

                           (x)      to authorize any person to execute on
behalf of the Company any instrument required to effect the grant of an Award
previously granted by the Administrator;

                           (xi)     to make all other determinations deemed
necessary or advisable for administering the Plan.

                  (c) EFFECT OF ADMINISTRATOR'S DECISION. The Administrator's
decisions, determinations and interpretations shall be final and binding on
all Participants and any other holders of Awards.

         5. ELIGIBILITY. Awards may be granted to Service Providers selected
by the Administrator who are not, at the time the Award is granted, Officers
or Directors of the Company.

         6. LIMITATIONS.

                  (a) Neither the Plan nor any Award shall confer upon a
Participant any right with respect to continuing the Participant's
relationship as a Service Provider with the Company, nor shall they interfere
in any way with the Participant's right or the Company's right to terminate
such relationship at any time, with or without cause.

                                     - 5 -

<PAGE>

         7. TERM OF PLAN. The Plan shall become effective upon its adoption
by the Board. The Plan shall have no fixed expiration date.

         8. TERM OF OPTION. The term of each Option shall be stated in the
Option Agreement or, if not stated in the Option Agreement, shall be ten (10)
years from the date of grant.

         9. OPTION EXERCISE PRICE AND CONSIDERATION.

                  (a) EXERCISE PRICE.  The per share exercise price for the
Shares to be issued pursuant to exercise of an Option shall be determined by
the Administrator.

                  (b) WAITING PERIOD AND EXERCISE DATES. At the time an
Option is granted, the Administrator shall fix the period within which the
Option may be exercised and shall determine any conditions that must be
satisfied before the Option may be exercised.

                  (c) FORM OF CONSIDERATION. The Administrator shall
determine the acceptable form of consideration for exercising an Option,
including the method of payment. Such consideration may consist entirely of:

                           (i)      cash;

                           (ii)     check;

                           (iii)    to the extent permitted by the Plan
Administrator in the Option Agreement, other Shares which (A) in the case of
Shares acquired upon exercise of an option, have been owned by the
Participant for more than six months on the date of surrender, and (B) have a
Fair Market Value on the date of surrender equal to the aggregate exercise
price of the Shares as to which said Option shall be exercised;

                           (iv)     consideration received by the Company
under a cashless exercise program implemented by the Company in connection
with the Plan;

                           (v)      any combination of the foregoing methods
of payment; or

                           (vi)     such other consideration and method of
payment for the issuance of Shares to the extent permitted by Applicable Laws.

         10. EXERCISE OF OPTION.

                  (a) PROCEDURE FOR EXERCISE; RIGHTS AS A SHAREHOLDER. Any
Option granted hereunder shall be exercisable according to the terms of the
Plan and at such times and under such conditions as determined by the
Administrator and set forth in the Option Agreement. Unless the Administrator
provides otherwise, vesting of Options granted hereunder shall be tolled
during any unpaid leave of absence. An Option may not be exercised for a
fraction of a Share.

                                     - 6 -

<PAGE>

                           An Option shall be deemed exercised when the Company
receives: (i) written or electronic notice of exercise (in accordance with the
Option Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Participant or, if
requested by the Participant, in the name of the Participant and his or her
spouse. Until the Shares are issued (as evidenced by the appropriate entry on
the books of the Company or of a duly authorized transfer agent of the Company),
no right to vote or receive dividends or any other rights as a shareholder shall
exist with respect to the Optioned Stock, notwithstanding the exercise of the
Option. The Company shall issue (or cause to be issued) such Shares promptly
after the Option is exercised. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the Shares are
issued, except as provided in Section 13 of the Plan.

                           Exercising an Option in any manner for vested and
nonforfeitable Shares shall decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.

                  (b) TERMINATION OF RELATIONSHIP AS A SERVICE PROVIDER. If a
Participant ceases to be a Service Provider, other than upon the Participant's
death or Disability, the Participant may exercise his or her Option within such
period of time as is specified in the Option Agreement to the extent that the
Option is vested on the date of termination (but in no event later than the
expiration of the term of such Option as set forth in the Option Agreement). In
the absence of a specified time in the Option Agreement, the Option shall remain
exercisable for three (3) months following the Participant's termination. If, on
the date of termination, the Participant is not vested as to his or her entire
Option, the Shares covered by the unvested portion of the Option shall revert to
the Plan. If, after termination, the Participant does not exercise his or her
Option within the time specified by the Administrator, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

                  (c) DISABILITY OF PARTICIPANT. If a Participant ceases to be a
Service Provider as a result of the Participant's Disability, the Participant
may exercise his or her Option within such period of time as is specified in the
Option Agreement to the extent the Option is vested on the date of termination
(but in no event later than the expiration of the term of such Option as set
forth in the Option Agreement). In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for twelve (12) months following
the Participant's termination. If, on the date of termination, the Participant
is not vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option shall revert to the Plan. If, after termination, the
Participant does not exercise his or her Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

                  (d) DEATH OF PARTICIPANT. If a Participant dies while a
Service Provider, the Option may be exercised within such period of time as is
specified in the Option Agreement (but in no event later than the expiration of
the term of such Option as set forth in the Option

                                     - 7 -
<PAGE>

Agreement), by the Participant's estate or by a person who acquires the right to
exercise the Option by bequest or inheritance, but only to the extent that the
Option is vested on the date of death. In the absence of a specified time in the
Option Agreement, the Option shall remain exercisable for twelve (12) months
following the Participant's termination. If, at the time of death, the
Participant is not vested as to his or her entire Option, the Shares covered by
the unvested portion of the Option shall immediately revert to the Plan. The
Option may be exercised by the executor or administrator of the Participant's
estate or, if none, by the person(s) entitled to exercise the Option under the
Participant's will or the laws of descent or distribution. If the Option is not
so exercised within the time specified herein, the Option shall terminate, and
the Shares covered by such Option shall revert to the Plan.

                  (e) BUYOUT PROVISIONS. The Administrator may at any time offer
to buy out for a payment in cash or Shares an Option previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Participant at the time that such offer is made.

         11.      Stock Awards.

                  (a) The Administrator is authorized to make Awards of Common
Stock or Awards denominated in units of Common Stock on such terms and
conditions and subject to such restrictions, if any (which may be based on
continuous service with the Company or the achievement of performance goals), as
the Administrator shall determine, in its sole discretion, which terms,
conditions and restrictions shall be set forth in the instrument evidencing the
Award. The terms, conditions and restrictions that the Administrator shall have
the power to determine shall include, without limitation, the manner in which
Shares subject to Stock Awards are held during the periods they are subject to
restrictions and the circumstances under which forfeiture of the Stock Award
shall occur by reason of termination of the Participant's employment or service
relationship.

                  (b) Upon the satisfaction of any terms, conditions and
restrictions prescribed in respect to a Stock Award, or upon the Participant's
release from any terms, conditions and restrictions of a Stock Award, as
determined by the Administrator, the Company shall release, as soon as
practicable, to the Participant or, in the case of the Participant's death, to
the personal representative of the Participant's estate or as the appropriate
court directs, the appropriate number of Shares.

                  (c) Notwithstanding any other provisions of the Plan, the
Administrator may, in its sole discretion, waive the forfeiture period and any
other terms, conditions or restrictions on any Stock Award under such
circumstances and subject to such terms and conditions as the Administrator
shall deem appropriate

         12. NON-TRANSFERABILITY OF AWARDS. Unless determined otherwise by the
Administrator, an Award may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Participant, only by the Participant. If the Administrator

                                     - 8 -
<PAGE>

makes an Award transferable, such Award shall contain such additional terms and
conditions as the Administrator deems appropriate.

         13.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION,
                  MERGER OR ASSET SALE.

                  (a) CHANGES IN CAPITALIZATION. Subject to any required action
by the shareholders of the Company, the number of shares of Common Stock covered
by each outstanding Award, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Shares have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Award, as well as the price per share of Common Stock covered
by each such outstanding Award, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Award.

                  (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Participant as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for a Participant
to have the right to exercise his or her Option until ten (10) days prior to
such transaction as to all of the Optioned Stock covered thereby, including
Shares as to which the Option would not otherwise be exercisable. In addition,
the Administrator may provide that any Company repurchase option or forfeiture
provision applicable to any Award shall lapse as to all such Shares, provided
the proposed dissolution or liquidation takes place at the time and in the
manner contemplated. To the extent it has not been previously exercised, an
Option will terminate immediately prior to the consummation of such proposed
action. To the extent a repurchase option or forfeiture provision applicable to
a Stock Award has not been waived by the Administrator, the Stock Award shall be
forfeited automatically immediately prior to the consummation of the proposed
action.

                  (c) MERGER OR ASSET SALE. Unless otherwise described in the
instrument evidencing the Award, in the event of a merger of the Company with or
into another corporation, or the sale of all or substantially all of the assets
of the Company, each outstanding Option shall be assumed or an equivalent option
or right substituted by the successor corporation or a Parent or Subsidiary of
the successor corporation. In the event that the successor corporation refuses
to assume or substitute for the Option, the Participant shall fully vest in and
have the right to exercise the Option as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable. If an Option
becomes fully vested and exercisable in lieu of assumption or substitution in
the event of a merger or sale of assets, the Administrator shall

                                     - 9 -
<PAGE>

notify the Participant in writing or electronically that the Option shall be
fully vested and exercisable for a period of fifteen (15) days from the date of
such notice, and the Option shall terminate upon the expiration of such period.
For the purposes of this paragraph, the Option shall be considered assumed if,
following the merger or sale of assets, the option or right confers the right to
purchase or receive, for each Share of Optioned Stock subject to the Option
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the type
of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the merger or sale of
assets is not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option, for each
Share of Optioned Stock subject to the Option, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.

                  Unless otherwise described in the instrument evidencing the
Award, in the event of a merger of the Company with or into another corporation,
or the sale of all or substantially all of the assets of the Company, the
vesting of Shares subject to Stock Awards shall accelerate, and the repurchase
and forfeiture provisions to which such Shares are subject shall lapse, if and
to the same extent that the vesting of outstanding Options accelerates in
connection with such merger or sale. If Options are to be assumed, continued or
substituted by a successor corporation or a Parent or Subsidiary thereof without
acceleration upon the occurrence of a merger or sale, the forfeiture provisions
to which such Stock Awards are subject shall continue with respect to shares of
the successor corporation or a Parent or Subsidiary thereof that may be issued
in exchange for such shares.

         14. ACQUIRED COMPANY AWARDS. Notwithstanding anything in the Plan to
the contrary, the Administrator may grant Awards under the Plan in substitution
for awards issued under other plans, or assume under the Plan awards issued
under other plans, if the other plans are or were plans of other acquired
entities ("Acquired Entities") (or the parent of the Acquired Entity) and the
new Award is substituted, or the old award is assumed, by reason of a merger,
consolidation, acquisition of property or stock, reorganization or liquidation
(the "Acquisition Transaction"). In the event that a written agreement pursuant
to which the Acquisition Transaction is completed is approved by the Board and
said agreement sets forth the terms and conditions of the substitution for or
assumption of outstanding awards of the Acquired Entity, said terms and
conditions shall be deemed to be the action of the Administrator, and the
persons holding such awards shall be deemed to be Participants.

         15. DATE OF GRANT. The date of grant of an Award shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Award, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Participant within a
reasonable time after the date of such grant.

         16. AMENDMENT AND TERMINATION OF THE PLAN.

                                     - 10 -
<PAGE>

                  (a) AMENDMENT AND TERMINATION. The Board may at any time
amend, alter, suspend or terminate the Plan.

                  (b) EFFECT OF AMENDMENT OR TERMINATION. No amendment,
alteration, suspension or termination of the Plan shall impair the rights of any
Participant, unless mutually agreed otherwise between the Participant and the
Administrator, which agreement must be in writing and signed by the Participant
and the Company. Termination of the Plan shall not affect the Administrator's
ability to exercise the powers granted to it hereunder with respect to Awards
granted under the Plan prior to the date of such termination.

         17. CONDITIONS UPON ISSUANCE OF SHARES.

                  (a) LEGAL COMPLIANCE. Shares shall not be issued pursuant to
an Award unless the issuance and delivery of such Shares shall comply with
Applicable Laws and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

                  (b) INVESTMENT REPRESENTATIONS. As a condition to the exercise
of an Option, the Company may require the person exercising such Option to
represent and warrant at the time of any such exercise that the Shares are being
purchased only for investment and without any present intention to sell or
distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.

         18. INABILITY TO OBTAIN AUTHORITY. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

         19. RESERVATION OF SHARES. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

         ADOPTED BY THE BOARD ON DECEMBER 8, 1999. AMENDED BY THE BOARD ON
         JANUARY 13, 2000 TO ADD STOCK AWARDS AND SECTION 14. PLAN FURTHER
         AMENDED BY THE BOARD ON FEBRUARY 10, 2000 TO INCREASE THE NUMBER
         OF SHARES AVAILABLE FOR ISSUANCE (ALTHOUGH THE AGGREGATE NUMBER
         OF SHARES AVAILABLE REMAINED AT 4,000,000 SHARES).

                                     - 11 -

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