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Exhibit 10.7  

2900
Semiconductor Drive

Santa Clara, CA 95052-8090

408 721 5000 Tel 

August     ,
2002 

Mr. Jackson
Tung

1900 Springwater Drive

Fremont, California 94539 

Dear
Mr. Tung: 

        This
addendum to your Employment Agreement ("Addendum") supplements certain provisions of the Option and Agreement and Plan of Merger entered into by and among National Semiconductor
Corporation ("National"), Nintai Acquisition Sub, Inc. DigitalQuake, Inc. ("DigitalQuake"), Paul A. Lessard and Michael G. Fung dated as of February 8, 2002, as amended as
of the date hereof, and as same may be subsequently amended from time to time (the "Merger Agreement") solely as such provisions relate to National and each Principal Employee as an employee of
National. Capitalized terms used in this letter have the meanings assigned to them in the Merger Agreement. 

	1.
	Section 3.5
of the Merger Agreement provides that you will receive the second installment payment and the third installment payment due under the Merger Agreement with respect
to your DigitalQuake Options and DigitalQuake Common Stock in cash. This Addendum supplements the Merger Agreement to give you the option to receive all or a portion of the second and third
installment payments in cash or in shares of National Common Stock as set forth below. As used herein, the "National Common Stock" means the common stock, par value $.50 per share, of National.

	(a)
	You
may elect to receive all or a part of the second installment payment in cash or shares of National Common Stock by delivering notice of such election to National in the form
attached hereto as Exhibit A and in the manner set forth for notices in Section 14.3 of the Merger Agreement (an "Election Notice") at least fifteen (15) but no more than thirty
(30) days prior to August 24, 2003, provided you have been continuously employed by National in its Displays Group from the Effective Time through August 24, 2003. Such notice
shall specify the portion of the second installment to be paid in cash and the portion to be paid in shares of NSC Common Stock. The number of shares of National Common Stock shall be determined in
accordance with Section 3 below; and

	(b)
	You
may elect to receive all or a part of the third installment payment in cash or shares of National Common Stock by delivering notice of such election to National an Election Notice
at least fifteen (15) but no more than thirty (30) days prior to August 29, 2004, provided you have been continuously employed by National in its Displays Group through
August 29, 2004. Such notice shall specify the portion of the third installment to be paid in cash and the portion to be paid in shares of NSC Common Stock. The number of shares of National
Common Stock shall be determined in accordance with Section 3 below. 

	2.
	The
form of the Election Notice is attached hereto as Exhibit A If you do not provide an Election Notice under Section 1(a) or Section 1(b), you will be deemed to
have elected to receive the applicable installment payment entirely in cash.

	3.
	The
number of shares of National Common Stock to be issued to you upon your election to receive all or a portion of the second or third installment payment in shares of National Common
Stock shall equal the quotient of (x) the dollar amount of the applicable installment payment payable to you which you have elected to receive in National Common Stock on the Election Notice
form divided by (y) the opening price of the National Common Stock as reported on the New York Stock Exchange Composite Tape on the Closing Date (or if there 

shall
be no trading on such date, then on the first subsequent date on which there is trading). In the event National changes the number of shares of National Common Stock issued and outstanding as a
result of a stock split, stock dividend or similar recapitalization with respect to such stock and the record date therefor (in the case of a stock dividend) or the effective date thereof (in the case
of a stock split or similar recapitalization for which a record date is not established) shall be prior to August 29, 2004, the number of shares of National Common Stock issuable pursuant to
Section 1(a) or Section 1(b) above shall be proportionately adjusted. National shall file a registration statement with the U.S. Securities and Exchange Commission on
Form S-8 or other appropriate form with respect to the shares of National Common Stock issuable pursuant to this letter prior to August 24, 2003. 

	4.
	Your
right to receive the second installment payment and third installment payment in whole or in part in shares of National Common Stock is contingent upon your being continuously
employed by National in its Display Group from the Effective Time through August 24, 2003 and through August 29, 2004, respectively. Accordingly, you acknowledge that your right to
receive the second and third
installment payment in whole or in part in shares of National Common Stock, with the number of shares to be determined by reference to a fixed and determined price, is a benefit to which you would not
otherwise be entitled if you had not become an employee of National upon the completion of the merger contemplated by the Merger Agreement.

	5.
	All
of the shares of National Common Stock issuable pursuant to Section 1(a) or Section 1(b) above will be validly issued, fully paid and nonassessable and free of and
not subject to any preemptive rights or rights of first refusal created by statute or by National's Second Restated Certificate of Incorporation, as amended, or Amended and Restated Bylaws upon their
issuance pursuant to this Addendum.

	6.
	You
understand that you may suffer adverse tax consequences in the event you elect to receive all or part of the second or third installment payments in shares of National Common
Stock. You represent that you have consulted with any tax consultants you deem advisable in connection with your option to exercise such election and that you are not relying on National for any tax
advice. 

        Please
sign below to confirm your agreement with the items set forth above. 

	 	 	Very truly yours,
	

 	
 	

NATIONAL SEMICONDUCTOR CORPORATION
	

 	
 	

By:	

//s// D A HANDORF

	

ACCEPTED AND AGREED TO AS OF

8/28/02:
	

//s// JACKSON TUNG
 Jackson Tung	
 	

 	

 
	    	 	 	 

 
 

Exhibit A
  
  Notice of Election to Receive Installment Payment in Cash or Stock    
  

	To:	 	National Semiconductor Corporation
	

From:	
 	

Jackson Tung
	

Re:	
 	

Election to Receive Installment Payment in Cash or Stock

        Pursuant
to the Option and Agreement and Plan of Merger entered into by and among National Semiconductor Corporation ("National"), Nintai Acquisition Sub, Inc. and
DigitalQuake, Inc. ("DigitalQuake"), Paul A. Lessard and Michael G. Fung dated as of February 8, 2002 as amended (the "Merger Agreement") and the Addendum to the Employment Agreement
dated August     , 2002 between National and the undersigned, notice is hereby given that the undersigned hereby elects to receive the installment payment set forth below contemplated
by Section 3.5 of the Merger Agreement in the form set forth below:. 

	Check as applicable:
	

 	
 	

    
	
 	

Second Installment Payment
	

 	
 	

    
	
 	

Third Installment Payment
	

Form of Payment
	

 	
 	

    
	
 	

All in cash, payable by check or wire transfer
	

 	
 	

    
	
 	

All in shares of National Common Stock
	

 	
 	

    
	
 	

A combination of cash and National Common Stock, with $            to be paid in cash and
$                        to be paid in shares of National Common Stock

	

Dated:	

    
	
 	

 
	 	 	 	    
 Jackson Tung
	    	 	 	 

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EXHIBIT 4.1    
  

 
 

HAGGAR CORP.
  
  and
  
  MELLON INVESTOR SERVICES LLC,
  
  Rights Agent    
  

 
 

Rights Agreement
  
    Dated as of October 10, 2002    
  

 
 
 

TABLE OF CONTENTS    
  

	 
	 	 
	 	Page

	Section 1	 	Certain Definitions	 	1
	Section 2	 	Appointment of Rights Agent	 	6
	Section 3	 	Issuance of Rights Certificates	 	6
	Section 4	 	Form of Rights Certificates	 	8
	Section 5	 	Countersignature and Registration	 	9
	Section 6	 	Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates	 	9
	Section 7	 	Exercise of Rights; Purchase Price; Expiration Date of Rights	 	10
	Section 8	 	Cancellation and Destruction of Rights Certificates	 	12
	Section 9	 	Reservation and Availability of Capital Stock	 	12
	Section 10	 	Preferred Stock Record Date	 	14
	Section 11	 	Adjustment of Purchase Price, Number and Kind of Shares or Number of Rights	 	14
	Section 12	 	Certificate of Adjusted Purchase Price or Number of Shares	 	22
	Section 13	 	Consolidation, Merger or Sale or Transfer of Assets or Earning Power	 	22
	Section 14	 	Fractional Rights and Fractional Shares	 	24
	Section 15	 	Rights of Action	 	26
	Section 16	 	Agreement of Rights Holders	 	26
	Section 17	 	Rights Certificate Holder Not Deemed a Stockholder	 	27
	Section 18	 	Concerning the Rights Agent	 	27
	Section 19	 	Merger or Consolidation or Change of Name of Rights Agent	 	28
	Section 20	 	Duties of Rights Agent	 	29
	Section 21	 	Change of Rights Agent	 	31
	Section 22	 	Issuance of New Rights Certificates	 	32
	Section 23	 	Redemption	 	33
	Section 24	 	Exchange	 	33
	Section 25	 	Notice of Certain Events	 	34
	Section 26	 	Notices	 	35
	Section 27	 	Supplements and Amendments	 	36
	Section 28	 	Successors	 	37
	Section 29	 	Determinations and Actions by the Board	 	37
	Section 30	 	Benefits of this Agreement	 	38
	Section 31	 	Severability	 	38
	Section 32	 	GOVERNING LAW	 	39
	Section 33	 	Counterparts	 	39
	Section 34	 	Descriptive Headings	 	39
	

Exhibit A	
 	

Description of Series B Junior Participating Preferred Stock	
 	

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

i

  

 
 

RIGHTS AGREEMENT    
  

        THIS AGREEMENT, dated as of October 10, 2002, between HAGGAR CORP., a Nevada corporation (the "Company"),
and Mellon Investor Services LLC, a New Jersey limited liability company (the "Rights Agent"). 

 
 

W I T N E S S E T H:    
  

        WHEREAS, on October 10, 2002 (the "Rights Dividend Declaration Date"), the Board of Directors of the
Company (the "Board") authorized and declared a dividend of one (1) preferred share purchase right (a
"Right") for each share of Common Stock (as hereinafter defined) of the Company outstanding at the Close of Business (as hereinafter defined) on
October 21, 2002 (the "Record Date"), and has authorized the issuance of one (1) Right (as such number may hereafter be adjusted pursuant
to 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 earliest of
the Distribution Date, the Redemption Date and the Final Expiration Date (as such terms are hereinafter defined), each Right initially representing the right to purchase one one-hundredth
(1/100th) of a share of Preferred Stock (as hereinafter defined), upon the terms and subject to the conditions hereinafter set forth. 

        NOW,
THEREFORE, for and 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 of the
Company then outstanding, excluding all Family Shares from shares beneficially owned, but shall not include the Company, any Subsidiary of the Company, any employee benefit plan of the Company or of
any Subsidiary of the Company, or any Person holding shares of Common Stock of the Company for or pursuant to the terms of any such plan. Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" (i) solely as the result of an acquisition of shares of Common Stock by the Company that, by reducing the number of shares outstanding, increases the proportionate number of
shares beneficially owned by such Person to 15% or more of the shares of Common Stock of the Company then outstanding, (ii) solely as the result of an acquisition of shares of Common Stock
pursuant to a Complying Offer, unless and until such time as (x) such Person shall purchase or otherwise become (as a result of actions taken by such Person or its Affiliates or Associates) the
Beneficial Owner of additional shares of Common Stock constituting one percent (1%) or more of the then outstanding shares of Common Stock other than pursuant to a Complying Offer, or (y) any
other Person who is the Beneficial Owner of one percent (1%) or more of the then outstanding shares of Common Stock shall thereafter become an Affiliate or Associate of such Person, or
(iii) if, as of August 30, 2001, such Person shall be the Beneficial Owner of 15% or more of the shares of Common Stock of the Company then outstanding, unless and until such time as
such Person shall become the Beneficial Owner of one or more additional shares of Common Stock (other than pursuant to a dividend or distribution paid or made by the Company on the outstanding shares
of Common Stock in shares of Common Stock or pursuant to a split or subdivision of the outstanding shares of Common Stock), unless, upon becoming the Beneficial Owner of such additional share or
shares of Common Stock, such Person is not then the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding. 

        (b)  "Act" shall have the meaning set forth in Section 9(c) hereof. 

1

 

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

        (d)  "Affiliate" and "Associate" shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the Rules and Regulations under the Exchange Act. 

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

          (i)  that
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 or on behalf of such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for purchase or
exchange, or (B) securities issuable upon exercise of Rights at any time prior to the occurrence of a Triggering Event
(as hereinafter defined), or (C) securities issuable upon exercise of Rights from and after the occurrence of a Triggering Event, which Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or pursuant to Section 3(a) or Section 22 hereof (the "Original Rights")
or pursuant to Section 11(i) hereof in connection with an adjustment made with respect to any Original Rights; 

        (ii)  that
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 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 such security if such agreement, arrangement or understanding (A) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations promulgated under the Exchange Act, and
(B) is not also then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or successor report); or 

        (iii)  that
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 or consent as
described in the proviso to subparagraph (ii) of this paragraph) or disposing of any securities of the Company; 

provided, however, that nothing in this paragraph 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 (40) days after the date
of such acquisition and no Person shall be deemed to be the "Beneficial Owner" of, or to "beneficially own", any Common Stock or other securities such Person has acquired or has the right to acquire
pursuant to any stock options or other rights issued under an employee benefit plan of the Company so long as such securities, options or rights were granted to such Person while such Person was an
employee of the Company. 

        (f)    "Board" shall mean the Board of Directors of the Company. 

        (g)  "Business Day" shall mean any day other than a Saturday, Sunday or a day on which national banking associations or other
banking institutions in the States of Texas or New Jersey are authorized or obligated by law or executive order to close. 

2

 

        (h)  "Close of Business" on any given date shall mean 5:00 P.M., Dallas, Texas time, on such date;  provided, however, that if such date is not a Business Day, it shall
mean 5:00 P.M., Dallas, Texas time, on the next succeeding Business Day. 

        (i)    "Common Stock" shall mean the common stock, par value $0.10 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 the equity securities or other equity interest having power to
control or direct the management, of such Person or, if such other Person is a Subsidiary of another Person, the ultimate parent corporation of such other Person. 

        (j)    "common stock equivalents" shall have the meaning set forth in Section 11(a)(iii) hereof. 

        (k)  "Company" shall mean Haggar Corp., a Nevada corporation, or, in case of a Section 13 Event, shall have the meaning
set forth in Section 13(a) hereof. 

        (l)    "Complying Offer" shall mean a tender offer or an exchange offer for all outstanding shares of Common Stock at a price
and on terms determined by at least a majority of the members of the Board who are not officers of the Company, after receiving advice from, among other advisors, one (1) or more recognized
investment banking firms, to be (i) at a price that is fair to stockholders (taking into account all factors that such members of the Board deem relevant including, without limitation, prices
that could reasonably be achieved if the Company or its assets were sold on an orderly basis designed to realize maximum value) and (ii) otherwise in the best interests of the Company and its
stockholders. 

        (m)  [Intentionally
omitted.] 

        (n)  "current market price" shall have the meaning set forth in Section 11(d) hereof. 

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

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

        (q)  "equivalent preferred stock" shall have the meaning set forth in Section 11(b) hereof. 

        (r)  "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended and in effect on the date of this Agreement. 

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

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

        (u)  "Family Shares" shall mean, at any particular time, all shares of Common Stock at such time beneficially owned solely by
Persons falling within any one (1) or more of categories (i), (ii) and (iii) below: 

          (i)  lineal
descendants (including persons adopted into the line of descent) of J.M. Haggar, Sr.; 

        (ii)  spouses
of such lineal descendants, including surviving spouses of deceased lineal descendants and excluding divorced former spouses of lineal descendants; or 

        (iii)  trusts
or estates of which the principal beneficiary or beneficiaries are Persons falling within any one (1) or more of categories (i) or
(ii) above and fiduciaries of such trusts or estates in their capacities as such fiduciaries. 

The
fact that one (1) or more beneficiaries of a trust or estate falling within category (iii) above who are not Persons falling within either of categories (i) or
(ii) above may be deemed to be a Beneficial Owner of all or a portion of the shares of Common Stock beneficially owned by such trust or estate solely by reason of being a beneficiary or
beneficiaries thereof shall not remove such shares from the category of Family Shares. 

3

 

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

        (w)  "holder" of Rights or Common Stock shall mean the registered holder thereof as reflected in the registry books of the
Rights Agent, with respect to Rights, or the transfer agent for the Common Stock, with respect to the Common Stock. 

        (x)  "Original Rights" shall have the meaning set forth in Section 1(e)(i) hereof. 

        (y)  "Person" shall mean any individual, firm, corporation, limited liability company, partnership, trust or other entity, and
shall include any successor (by merger or otherwise), thereof or thereto. 

        (z)  "Preferred Stock" shall mean shares of Series B Junior Participating Preferred Stock, par value $.10 per share, of
the Company, with the rights, preferences and designations described in Exhibit A hereto, and, to the extent that there are not a sufficient
number of shares of Series B Junior Participating Preferred Stock authorized to permit the full exercise of the Rights, any other series of preferred stock, par value $.10 per share, of the
Company designated for such purpose containing terms substantially similar to the terms of the Series B Junior Participating Preferred Stock. 

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

        (bb) "Purchase Price" shall have the meanings set forth in Section 4(a), Section 7(b),
Section 11(a)(ii) and Section 13(a), respectively. 

        (cc) "Record Date" shall mean October 21, 2002. 

        (dd) "Redemption Price" shall have the meaning set forth in Section 23(a) hereof. 

        (ee) "Right" shall mean the one (1) preferred share purchase right for each share of Common Stock of the Company
authorized and declared as a dividend on the Rights Dividend Declaration Date. 

        (ff)  "Rights Agent" shall mean Mellon Investor Services LLC, or its successor from time to time serving as such under this
Agreement. 

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

        (hh) "Rights Dividend Declaration Date" shall mean October 10, 2002. 

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

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

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

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

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

        (nn) "Subsidiary" shall mean, with reference to any Person, any Person of which an amount of voting securities or other
equity interests with voting power sufficient to elect at least a majority of the directors, or other governing body, of such Person, is beneficially owned, directly or indirectly, by such Person, or
otherwise controlled by such Person. 

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

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

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

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

4

 

 
 

Section 2
  Appointment of Rights Agent    
  

        The Company hereby appoints the Rights Agent to act as rights 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. The Rights Agent shall have no duty to supervise,
and in no event shall be liable for, the acts or omissions of any such co-Rights Agent. 

 
 

Section 3
  Issuance of Rights Certificates    
  

        (a)  Until
the earlier of (i) the Close of Business on the tenth Business Day after the Stock Acquisition Date or (ii) the Close of Business on the tenth
Business Day after the date that a tender or exchange offer (other than a Complying Offer) by any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan or employee
stock plan of the Company or of any Subsidiary of the Company, or any Person 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 Rules and Regulations under the Exchange Act, if upon consummation thereof, such Person would be the Beneficial Owner of 15%
or more of the shares of Common Stock then outstanding, in each case unless the applicable time period is extended as provided in Section 3(d) hereof (the earlier of (i) and (ii), as the
same may be extended pursuant to Section 3(d), being herein referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by 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) each Right 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 Company will prepare and execute, the Rights Agent will countersign, and the
Company will send or cause to be sent (or the Rights Agent will, if requested and provided with all necessary information, 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 (1) or more Rights certificates, in substantially
the form of Exhibit B hereto (the "Rights Certificates"), evidencing one (1) 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 evidenced solely by such Rights Certificates. The Company shall promptly notify the Rights Agent in writing upon the occurrence of the Distribution Date and, if such notification is given orally,
the Company shall confirm same in writing on or prior to the Business Day next following. Until such notice is received by the Rights Agent, the Rights Agent may presume conclusively for all purposes
that the Distribution Date has not occurred. 

        (b)  As
promptly as practicable following the Record Date, the Company will send a copy of a Summary of Rights, in substantially the form attached hereto as  Exhibit C (the "Summary
of Rights"), by first-class, postage prepaid mail, to each record holder
of the Common Stock as of the Close of Business on
the Record Date to whom the Company has not previously sent a copy of the Summary of Rights, at the address of such holder shown on the records of the Company. With respect to certificates for the
Common Stock outstanding as of the Record Date, until the Distribution Date, the Rights will be evidenced by such certificates for the Common Stock and the holders of the Common Stock shall 

5

 

also be the holders of the associated Rights. Until the earlier of the Distribution Date or the Expiration Date (as such term is defined in Section 7 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 that become outstanding (whether originally issued or delivered from the Company's treasury) after the
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 evidences and entitles the holder hereof to certain Rights as set forth in the Rights Agreement between Haggar Corp. (the "Company") and Mellon Investor Services
LLC (the "Rights Agent") dated as of October 10, 2002, as may be amended from time to time (the "Rights Agreement"), the terms of which are hereby incorporated herein by reference and a copy of
which is on file at the principal office of the Company. Under certain circumstances, as set forth in the Rights Agreement, such Rights will be evidenced by separate certificates and will no longer be
evidenced by this certificate. The Company will mail to the holder of this certificate a copy of the Rights Agreement, 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 beneficially owned by, any Person who is, was or becomes an Acquiring Person or an
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 evidenced by such certificates alone and holders of Common Stock shall also be the 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. In the event that the Company purchases or acquires any shares of
Common Stock after the Record Date but prior to the Distribution Date, any Rights associated with such shares of Common Stock shall be deemed cancelled and retired so that the Company shall not be
entitled to exercise any Rights associated with the shares of Common Stock that are no longer outstanding. 

        (d)  The
ten (10) Business Day time periods provided for in Section 3(a), and thus the Distribution Date, may be extended at any time or times prior to the
expiration of the applicable original or extended time period by action of a majority of the Board. Promptly after any such extension, the Company shall give written notice of such extension to the
Rights Agent and the holders of the Rights; provided, however, that the failure to give such notice, or any defects therein, shall not affect the
validity of any such extension. 

 
 

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), when, as and if issued, 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 (but which do not affect the rights, duties or responsibilities of the Rights Agent) 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 or inter-dealer
quotation system 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 

6

 

distributed, shall be dated as of the date of authentication 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 thereon at the price set forth thereon (such exercise price per one one-hundredths of a share to be referred to herein as 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) 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 (or of any such Associate or Affiliate) 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 that the Board
has determined is part of a plan, arrangement or understanding that has as a primary purpose or effect of avoidance of Section 7(e) hereof, and any Rights Certificate issued pursuant to
Section 6 or Section 11 hereof upon transfer, exchange, replacement or adjustment of any other Rights Certificate referred to in this sentence, shall contain (to the extent the Rights
Agent has knowledge thereof and to the extent feasible) 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 such 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 (if any), 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 that shall be attested by the Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be manually countersigned (or by facsimile, if permitted by law) by the Rights Agent 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, receipt by the Rights Agent of notice to that effect and all other relevant information referred to in Section 3(a), the Rights
Agent will keep or cause to be kept, at its office designated for such purpose, books for registration and transfer of the Rights Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Rights Certificates, the number of Rights evidenced on its face by each of the Rights Certificates and the date of each of the Rights Certificates. 

7

 

 
 

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), Section 14 and Section 24 hereof, at any time after the Close of Business on the
Distribution Date, and at or prior to the Close of Business on the Expiration Date, any Rights Certificate or Certificates may be transferred, split up, combined or exchanged for another Rights
Certificate or Certificates, entitling the 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 entitled such holder (or former holder in the case of a transfer) to purchase. Any 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
office 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 holder shall have completed and signed the certificate contained in the form of assignment on the reverse side of such Rights Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request. Thereupon the
Rights Agent shall countersign and deliver to the Person entitled thereto a Rights Certificate or Rights Certificates, as the case may be, as so requested. The Company may require payment from the
holders of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer, split up, combination or exchange of Rights Certificates. The Rights Agent
shall promptly forward any such sum collected by it to the Company or to such Persons as the Company shall specify by written notice. The Rights Agent shall have no duty or obligation to take any
action under any Section of this Agreement which requires the payment by a Rights holder of applicable taxes and governmental charges unless and until it is satisfied that all such taxes and/or
governmental charges have been paid. 

        (b)  Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Rights Certificate, and,
in case of loss, theft or destruction, of indemnity or security 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, the holder of any Rights Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein including,
without limitation, the restrictions on exercisability set forth in Section 9(c), Section 11(a)(iii) and Section 23(a) hereof) in whole or in part at any time after the
Distribution Date by surrendering the Rights Certificate, with the form of election to purchase and the related certificate on the reverse side thereof duly executed and properly completed, to the
Rights Agent at the office 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 other shares, securities, cash or other assets, as the case may be) as to which such surrendered Rights are then exercisable, at or prior to the earliest of
(i) the Close of Business on October 10, 2012 (the "Final Expiration Date"), (ii) the time at which the Rights are redeemed as
provided in Section 23 hereof or (iii) the time at which such Rights are exchanged as 

8

 

provided in Section 24 hereof (the earliest of (i), (ii) and (iii) being herein referred to as the "Expiration Date"). 

        (b)  The
Purchase Price for each one one-hundredth (1/100th) of a share of Preferred Stock (or other securities, cash or assets, as the case may be) pursuant to
the exercise of a Right shall initially be $45.00 and shall be subject to adjustment from time to time as provided in Sections 11 and 13(a) hereof, and shall be payable in lawful money of the United
States 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 related certificate duly executed and properly
completed, accompanied by payment, with respect to each Right so exercised, of the Purchase Price per one one-hundredth (1/100th) 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 tax or charge required to be paid under Section 9(e) hereof, the
Rights Agent shall, subject to Section 20(j) 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 holder of such Rights Certificate, registered in such name or
names as may be designated by such holder, and (iv) after receipt thereof, deliver such cash, if any, to or upon the order of the holder of such Rights Certificate. The payment of the Purchase
Price (as such amount may be reduced pursuant to Section 11(a)(iii) hereof) shall be made in cash or by certified bank check or bank draft payable to the order of the Company. In the
event that the Company is obligated to issue other securities (including Common 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 holder of any Rights Certificates shall exercise less than all the Rights evidenced thereby, a new Rights Certificate evidencing Rights equivalent to the
Rights remaining unexercised shall be issued by the Rights Agent and delivered to, or upon the order of, the 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 

9

 

continuing agreement, arrangement or understanding regarding the transferred Rights or (B) a transfer that the Board has determined is part of a plan, arrangement or understanding that has as
a primary purpose or effect the avoidance of this Section 7(e), shall become null and void without any further action and no holder of such Rights shall have any rights whatsoever with respect
to such Rights, whether under any provision of this Agreement or otherwise. The Company shall use all reasonable efforts to ensure that the provisions of this Section 7(e) and
Section 4(b) hereof are complied with, but neither the Company nor the Rights Agent shall have any liability to any holder of Rights Certificates or to any other Person as a result of the
Company making or failing to make any determinations with respect to an Acquiring Person or any of such 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 holder
of Rights or other securities upon the occurrence of any purported exercise as set forth in this Section 7 unless such holder shall have (i) properly completed and duly executed the
related certificate contained in the form of election to purchase set forth on the reverse side of the Rights Certificate surrendered for such exercise, and (ii) provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request. 

 
 

Section 8
  Cancellation and Destruction of Rights Certificates    
  

        All Rights Certificates surrendered for the purpose of exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or 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 Certificates purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all cancelled Rights Certificates to the
Company, or shall, at the written request of the Company, destroy such cancelled Rights Certificates, and in such case shall deliver a certificate of destruction thereof to the Company. 

 
 

Section 9
  Reservation and Availability of Capital Stock    
  

        (a)  The
Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued 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 or out of its authorized and issued shares held in its treasury), 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 or inter-dealer quotation system of a registered national securities association, the Company shall use its best efforts to
cause, from and after such time as the Rights become exercisable, all shares and/or other securities reserved for such issuance to be listed on such exchange or quotation system 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 

10

 

by the Company upon exercise of the Rights has been determined in accordance with Section 11(a)(iii) hereof or as soon as is required by law, as the case may be, a registration
statement under the Securities Act of 1933, as amended (the "Act"), with respect to the issuance of 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, or
(B) the Expiration Date. 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 referred to in clause (i) of the first
sentence of this Section 9(c), the exercisability of the Rights in order to prepare and file such registration statement and permit it to become effective. Upon any such suspension, the Company
shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect.
The Company shall notify the Rights Agent in writing whenever it makes a public announcement pursuant to this Section 9(c) and give the Rights Agent a copy of such announcement. 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, and shall notify the Rights Agent in writing of such suspension. 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 with respect thereto shall not have been declared effective. 

        (d)  The
Company covenants and agrees that it will take all such action as may be necessary to ensure that all one one-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 and/or
other securities (subject to payment of the Purchase Price), be duly and validly authorized and issued and fully paid and nonassessable. 

        (e)  The
Company further covenants and agrees that it will pay when due and payable any and all taxes and governmental charges that may be payable in respect of the issuance
or delivery of the Rights Certificates and of any certificates for a number of one-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 tax or charge that may be payable in respect of any transfer or delivery of Rights Certificates to a Person other
than, or the issuance or delivery of a number of one one-hundredths of a share of Preferred Stock (or Common Stock and/or other securities, as the case maybe) in respect of a name other
than that of, the 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 holder upon the exercise of any Rights until such tax or charge shall have been paid (any
such tax or charge being payable by the holder of such Rights Certificate at the time of surrender) or until it has been established to the Company's or the Rights Agent's satisfaction that no such
tax or charge 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) issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of such 

11

 

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 evidencing such Rights was duly surrendered and payment of the Purchase Price (and all applicable taxes or governmental charges) 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 evidenced 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. 

        (a)  (i) In
the event the Company shall at any time after the Record Date (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 capital 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 capital 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
capital 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, he, she or it
would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification; provided,
however, that in no event shall the consideration to be paid upon the exercise of one (1) Right be less than the aggregate par value of the shares of capital stock of
the Company issuable upon exercise of one (1) Right. If an event occurs that would require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii) hereof, the adjustment provided for in this Section 11(a)(i) shall be in addition to, and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii) hereof. 

        (ii)  Subject
to Section 24 of this Agreement, in the event that: 

        (A)  any
Person shall at any time after the Record Date become an Acquiring Person and a Stock Acquisition Date with respect to such Person shall have occurred; or 

        (B)  any
Acquiring Person or any Affiliate or Associate of any Acquiring Person, directly or indirectly, shall merge into the Company or otherwise combine with the Company
and the Company shall be the continuing or surviving corporation of such merger or combination and the Common Stock shall remain outstanding and unchanged; 

12

 

then,
promptly following the first occurrence of a Section 11(a)(ii) 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 to be referred to herein as the "Adjustment Shares"); provided, however, that if the transaction
that would otherwise give rise to the foregoing adjustment is also subject to the provisions of Section 13 hereof, then only the provisions of Section 13 hereof shall apply and no
adjustment shall be made pursuant to this Section 11(a)(ii); and provided, further, that if the provisions of Section 13 hereof are determined by a court of competent jurisdiction or
other authority to be invalid, illegal or unenforceable in respect of such transaction, then the provisions of this Section 11 shall be applicable to such transaction. 

        (iii)  In
the event that the number of shares of Common Stock that are authorized by the Company's Articles of Incorporation but not outstanding or reserved for issuance for
purposes other than upon exercise of the Rights are not sufficient to permit the exercise in full of the Rights in accordance with the foregoing subparagraph (ii) of this Section 11(a),
the Company shall: (A) determine the excess of (1) the value of the Adjustment Shares issuable upon the exercise of a Right (the "Current
Value") over (2) the Purchase Price (such excess, the "Spread"), and (B) with respect to each Right, make adequate
provision to substitute for the Adjustment Shares, upon 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 that the Board has deemed to have essentially the same value or economic rights as shares of
Common Stock (such shares of preferred stock to be referred to herein 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, where such aggregate value has been determined by the Board based upon
the advice of a recognized investment banking firm selected by the Board (which determination shall be described in a statement filed with the Rights Agent and shall be conclusive and binding on the
Rights Agent, the holders of the Rights and all other Persons); provided, however, 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. If the
Board shall determine in good faith that it is likely that sufficient additional shares of Common Stock could be authorized for issuance upon exercise in full of the Rights, the thirty (30) day
period set forth above may be extended to the extent necessary (with prompt written notice of such extension to the Rights Agent), 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 period, as it may be extended, the "Substitution Period"). To the extent that the Company determines that
some action need be taken pursuant to the first and/or second sentences of this Section 11(a)(iii), the Company (x) shall provide, subject to Section 7(e) hereof, that such action
shall apply uniformly to all outstanding Rights, and (y) may suspend the exercisability of the 

13

 

Rights until the expiration of the Substitution Period in order to seek any authorization of additional shares and/or to decide the appropriate form of distribution to be made pursuant to such first
sentence and to determine the value thereof. In the event of any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is no longer in effect. The Company shall notify the Rights Agent in writing whenever it makes a public announcement pursuant
to this Section 11(a)(iii) and give the Rights Agent a copy of such announcement. For purposes of this Section 11(a)(iii), the value of the Common Stock shall be the current
market price (as determined pursuant to Section 11(d) hereof) per share of the Common Stock on the Section 11(a)(ii) Trigger Date and the value of any "common stock equivalent"
shall be deemed to have the same value as the Common 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"), 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 is convertible into Preferred Stock or 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 that 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); provided, however, that in no event shall the consideration to be paid upon the
exercise of one (1) Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise of one (1) Right. 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, 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,
options or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed. 

        (c)  In
case the Company shall fix a record date for 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 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
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, whose determination shall be described in a statement filed with the Rights Agent) of the portion of the cash, 

14

 

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 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 such 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, Inc. Automated Quotation System/National Market System 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 (which determination shall be described in a statement filed with the Rights Agent and
shall be conclusive and
binding on the Rights Agent, the holders of the Rights and all other Persons) 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 and binding 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 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 

15

 

"current market price" per share of Preferred Stock shall be conclusively deemed to be an amount equal to one hundred (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, the "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 one one-hundredths (1/100ths) of a share of Preferred Stock shall be equal to the "current market price" of one (1) share of Preferred Stock divided by
one hundred (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 that 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 (1/10,000th) of a share of Common Stock or other share or one-millionth (1/1,000,000th) 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 that mandates such adjustment, or (ii) the Expiration Date. 

        (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) and (k), 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 (1/1,000,000th)) 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 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 (1/10,000th)) 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 

16

 

(with prompt written notice thereof to the Rights Agent) of its election to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the 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 evidencing, subject to Section 14 hereof,
the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution
and replacement for the Rights Certificates held by such holders prior to the date of adjustment, and upon surrender thereof if required by the Company, new Rights Certificates evidencing all the
Rights to which such holders shall be entitled after such adjustment. Rights Certificates so to be distributed shall be issued, executed and delivered by the Company, and countersigned and delivered
by the Rights Agent, 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-hundredths of
a share and the number of one one-hundredths of a share that were expressed in the initial Rights Certificates issued hereunder. 

        (k)  Before
taking any action that would cause an adjustment reducing the Purchase Price below the then stated value, if any, of the number of one one-hundredths
of a share of Preferred Stock issuable upon exercise of the Rights, the Company shall take any corporate action that may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable such number of one one-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 (with prompt written notice thereof to the Rights Agent) 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 capital 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 capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to
such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder's
right to receive such additional shares (fractional or otherwise) or securities upon the occurrence of the event requiring such adjustment. 

        (m)  Anything
in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price, in addition to those
adjustments expressly required by this Section 11, as and to the extent that in its good faith judgment the Board 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 or of Preferred Stock or securities that by their terms
are convertible into or exchangeable for shares of Preferred Stock, (iii) stock dividends or (iv) 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. 

17

 

        (n)  The
Company covenants and agrees that it 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 that complies with Section 11(o) hereof), (ii) merge with or into any other Person (other than a Subsidiary of the Company in a transaction that complies with
Section 11(o) hereof), or (iii) sell or transfer (or permit any Subsidiary to sell or transfer) in one (1) 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 other Person or Persons (other than the Company and/or
any of its Subsidiaries in one (1) 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 that 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 stockholders of the Person who constitutes, or would constitute, the "Principal Party" for
purposes of Section 13(a) hereof shall have received a distribution of Rights previously owned by such Person or any of its Affiliates or Associates. 

        (o)  The
Company covenants and agrees that, after the Distribution Date, it will not, except as permitted by Section 23 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 Record 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 Rights thereafter associated with each share of Common Stock following any such event shall equal the result obtained by
multiplying the number of Rights associated with each share of Common Stock immediately prior to such event by a fraction, the numerator of which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and the denominator of which will 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 or Section 13 hereof, the Company shall (a) promptly prepare a certificate setting
forth such adjustment and a brief statement of the computations and 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) mail a brief summary thereof to each holder of a Rights Certificate (or, if prior to the Distribution Date, to each holder of a
certificate representing shares of Common Stock) in accordance with Section 26 hereof. The Rights Agent shall be fully protected and entitled to conclusively rely on any such certificate and on
the correctness of any adjustment therein contained and shall have no duty or liability with respect to, and shall not be deemed to have knowledge of, any adjustment unless and until it shall have
received such a certificate. Any adjustment to be made pursuant to Section 11 or 13 hereof shall be effective as of the date of the event giving rise to such adjustment. 

18

 

 
 

Section 13
  Consolidation, Merger or Sale or Transfer of Assets 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 that 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 that 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 (1) or
more of its Subsidiaries shall sell or otherwise transfer) in a transaction or in 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 (1) 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, nonassessable 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 then 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 then 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 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)  The
term "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 

19

 

        (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 (1) Person, the Common
Stocks of two (2) 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 that have not been issued or reserved for issuance to permit the exercise in full of the Rights in accordance with this Section 13 and unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a supplemental agreement 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)  will
deliver to holders of the Rights historical financial statements for the Principal Party and each of its Affiliates that comply in all respects with the
requirements for registration on Form 10 (or any successor form) under the Exchange Act. 

The
provisions of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers. In the event that a Section 13 Event shall occur at any time
after the occurrence of a Section 11(a)(ii) Event, the Rights which have not theretofore been exercised shall thereafter become exercisable in the manner described in Section13(a). 

        (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 Complying Offer (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 Complying 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 Complying 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, or to distribute Rights Certificates that evidence fractional Rights, except prior to the Distribution
Date as provided in Section 11(p) hereof. In lieu of such fractional Rights, there shall be paid to the holders of the Rights 

20

 

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 such 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 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 the National Association of Securities
Dealers, Inc. Automated Quotation System/National Market System 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
dosing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by the Board. 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 shall be used. 

        (b)  The
Company shall not be required to issue fractions of shares of Preferred Stock (other than, except as provided in Section 7(c) hereof, fractions that are
integral multiples of one one-hundredth of a share of Preferred Stock) upon exercise of the Rights or to distribute certificates which evidence fractional shares of Preferred Stock (other
than, except as provided in Section 7(c) hereof, fractions which are integral multiples of one one-hundredths of a share of Preferred Stock). In lieu of fractional shares of
Preferred Stock that are not integral multiples of one one-hundredth (1/100th) of a share of Preferred Stock, the Company may pay to the 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 (1/100th) of a share of Preferred Stock. For purposes
of this Section 14(b), the current market value of one one-hundredth (1/100th) 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 that evidence fractional shares of Common Stock. In lieu of fractional shares of Common Stock, the Company may pay to the 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 (1) share of Common Stock. For purposes of this Section 14(c), the
current market value of one (1) share of Common Stock shall be the closing price of one (1) 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 such holder's right to receive any fractional Rights or any fractional shares upon exercise of a
Right, except as permitted by this Section 14. 

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

21

 

payment of fractional Rights or fractional shares unless and until the Rights Agent shall have received such a certificate and sufficient monies. 

 
 

Section 15
  Rights of Action    
  

        (a)  All
rights of action in respect of this Agreement, other than rights of action given to the Rights Agent pursuant to Section 18 and Section 20 hereof, are
vested in the respective holders of the Rights Certificates (and, prior to the Distribution Date, the holders of the Common Stock); and any 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
such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce, or otherwise act in respect of, such
holder's right to exercise the Rights evidenced by such Rights Certificate in the manner provided in such Rights Certificate and in this Agreement. Without limiting the foregoing or any remedies
available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach by the Company of this Agreement and shall be
entitled to specific performance of the obligations hereunder and injunctive relief against actual or threatened violations by the Company of the obligations hereunder of any Person subject to this
Agreement. 

        (b)  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, judgment, decree or ruling (whether interlocutory
or final) issued by a court or by a governmental, regulatory, self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation; provided, however, that the Company must use all reasonable efforts to have any such
injunction, order, judgment, decree or ruling lifted or otherwise overturned as soon as possible. 

 
 

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; 

        (b)  after
the Distribution Date, the Rights Certificates are transferable only on the registry books of the Rights Agent if surrendered at the office of the Rights Agent
designated for such purpose, 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 evidenced 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; 

22

 

        (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; and 

        (e)  such
holder shall be bound by the provisions of Section 20 hereof. 

 
 

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 that may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Rights Certificate be construed to confer upon the holder of any Rights Certificate, as such, any of the rights of a 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)  As
consideration for its agreement to act as the Rights Agent hereunder, the Company agrees to promptly pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and other disbursements incurred in the preparation, delivery, amendment,
administration and execution of this Agreement and the exercise and performance of its duties hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense (including, without limitation, the reasonable fees and expenses of legal counsel), incurred without gross
negligence, bad faith or willful misconduct on the part of the Rights Agent (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction), for any action taken, suffered or omitted by the Rights Agent in connection with the acceptance, administration, exercise and
performance of its duties under this Agreement, including, without limitation, the costs and expenses of defending against and appealing any claim of liability arising therefrom, directly or
indirectly. The costs and expenses incurred in enforcing this right of indemnification shall be paid by the Company. The provisions of this Section 18 and Section 20 below shall survive
the termination of this Agreement, the exercise or expiration of the Rights and the resignation or removal of the Rights Agent. 

        (b)  The
Rights Agent shall be authorized and protected and shall incur no liability for or in respect of any action taken, suffered or omitted by it in connection with its
acceptance and administration of this Agreement and the exercise and performance of its duties hereunder, in reliance upon any Rights Certificate or certificate for 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 or 

23

 

otherwise upon the advice of counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to receive notice thereof
hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take any action in connection therewith unless and until it has received such notice in writing. 

        (c)  Notwithstanding
anything in this Agreement to the contrary, in no event shall the Rights Agent be liable for special, punitive, indirect, consequential or incidental
loss or damage of any kind whatsoever (including but not limited to lost profits), whether or not the Rights Agent has been advised of the likelihood of such loss or damage and regardless of the form
of action. 

 
 

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

        (a)  Any
Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any Person resulting from any merger or
consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the 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;  provided, however, that such
Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. In
case at the time such successor Rights Agent shall succeed to the agency created by this Agreement any of the Rights Certificates shall have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of 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 Rights Agent or in the name of the successor Rights Agent; and in all such
cases such Rights Certificates shall have the full force provided in the Rights Certificates and in this Agreement. 

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

 
 

Section 20
  Duties of Rights Agent    
  

        The Rights Agent undertakes to perform only the duties and obligations expressly imposed by this Agreement (and no implied duties) upon the following terms and
conditions, by all of which the Company and the holders of Rights Certificates, by their acceptance thereof, shall be bound: 

        (a)  The
Rights Agent may consult with legal counsel (who may be legal counsel for the Company or an employee of the Rights Agent), and the advice or opinion of such counsel
shall be full and complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted by it and in
accordance with such advice or opinion. 

        (b)  Whenever
in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter (including, without
limitation, the identity of any Acquiring Person and the determination of "current market price") be proved or established by the Company prior to taking, suffering or omitting to take any action
hereunder, such fact or matter 

24

 

(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 (if any), 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 and
complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted by it under the provisions of this
Agreement in reliance upon such certificate. 

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

        (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 the Rights Certificates, and the Rights
Agent shall not be required to verify the same (except as to its countersignature on such Rights Certificate). All such statements and recitals are and shall be deemed to have been made by the Company
only. 

        (e)  The
Rights Agent shall not have any liability for or be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Rights Certificate (except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Agreement or in any Rights Certificate; nor shall it be responsible for any adjustment required under the provisions of Sections 3,
11, 13, 23 or 24 hereof or responsible for the manner or method used to determine the amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment
(except with respect to the exercise of Rights evidenced by Rights Certificates after receipt of the certificate described in Section 12 hereof, upon which the Rights Agent may rely); 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 agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this Agreement. 

        (g)  The
Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from the Chairman of the Board (if
any), 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 such instructions shall be full authorization and protection to the Rights Agent and the Rights Agent shall
not be liable for or in respect of any action taken, suffered or omitted by it in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions. The
Rights Agent shall be fully authorized and protected in relying upon the most recent instructions received by any such officer. Any application by the Rights Agent for written instructions from the
Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken, suffered or omitted by the Rights Agent under this Agreement and the date on and/or after which
such action shall be taken or suffered or such omission shall be effective. The Rights Agent shall not be liable for any action taken or suffered by, or omission of, the Rights Agent in accordance
with a proposal included in any such application on or after the date specified in such application (which date 

25

 

shall not be less than five Business Days after the date any officer of the Company actually receives such application, unless any such officer shall have consented in writing to an earlier date)
unless, prior to taking any such action (or the effective date in the case of an omission), the Rights Agent shall have received written instructions in response to such application specifying the
action to be taken, suffered or omitted. 

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

        (i)    The
Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself (through its directors, officers
and employees) or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, default, neglect or misconduct of any such attorneys or agents or for
any loss to the Company or any other Person resulting from any such act, default, neglect or misconduct, absent gross negligence, bad faith or willful misconduct in the selection and continued
employment thereof (each as determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction). 

        (j)    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. 

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

 
 

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 known to the Rights Agent, by registered or certified mail, and to the holders of the Rights Certificates by
first-class mail. The Company may remove the Rights Agent or any successor Rights Agent upon thirty (30) days' notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Stock and Preferred Stock, by registered or certified mail, and to the holders of the Rights Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period
of thirty (30) days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the
holder of a Rights Certificate (who shall, with such notice, submit such holder's Rights Certificate for inspection by the Company), then any holder of any Rights Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (a) a Person organized and doing
business under the laws of the United States or of any state of the United States, in good standing, which is authorized under such laws to exercise stock transfer powers 

26

 

and is subject to supervision or examination by federal or state authority and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least $25,000,000 or
(b) an Affiliate of such a Person. 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 mail a notice thereof in writing to the holders of the Rights Certificates. Failure to give any notice
provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be. 

 
 

Section 22
  Issuance of New Rights Certificates    
  

        Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option, issue new Rights Certificates evidencing
Rights in such form as may be approved by its Board to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares or other securities or property purchasable
under the 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 outstanding, granted or
awarded as of the Distribution Date, or upon the exercise, conversion or exchange of securities issued by the Company on or prior to the Distribution Date and (b) may, in any other case, if
deemed necessary or appropriate by the Board, issue Rights Certificates representing the appropriate number of Rights in connection with such issuance or sale; provided,
however, that (i) no such Rights Certificate shall be issued 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    
  

        (a)  The
Board may, at its option, at any time prior to the earlier of (i) the Close of Business on the Distribution Date following the Stock Acquisition Date or
(ii) the Final Expiration Date, redeem all but not less than all 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 redemption price being hereinafter referred to as the "Redemption
Price"). The redemption of the Rights by the Board may be made effective at such time and on such bases and conditions as the Board, in its sole discretion, may establish.
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. 

27

 

        (b)  Immediately
upon the action of the Board ordering 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 ordering the redemption of the Rights, the Company shall give written 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 that 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
Board may, at its option, at any time after any Person becomes an Acquiring Person, cause the Company to exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have become null and void pursuant to the provisions of Section 7(e) hereof) for shares of Common Stock at an exchange ratio of one share of Common
Stock per Right, appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board shall not be empowered to effect such exchange at any time after any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan of the Company or any such Subsidiary, or any Person holding shares of 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 shares of Common Stock then outstanding. 

        (b)  Immediately
upon the action of the Board ordering 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 such exchange (with prompt written notice thereof to the Rights Agent);  provided,
however, that the failure to give, or any defect in, such notice shall not affect the legality or 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 that is mailed in
the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the method by which the exchange of the shares of Common Stock
for Rights will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights
(other than Rights that have become null and void pursuant to the provisions of Section 7(e) hereof) held by each holder of Rights. 

        (c)  In
the event that there shall not be sufficient 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, should the Board order any such exchange, shall take all such action as may be necessary to authorize additional shares of Common
Stock for issuance upon exchange of the Rights. 

        (d)  The
Company shall not be required to issue fractions of shares of Common Stock or to distribute certificates that evidence fractional shares of Common Stock. In lieu of
such fractional shares of Common Stock, the Company shall pay to the holders of the Right Certificates with regard to which such fractional shares of Common Stock would otherwise be issuable, an
amount in cash equal to the 

28

 

same fraction of the current market value of a whole share of Common Stock. For the purposes of this subsection (d), the current market value of a whole share of Common Stock shall be the closing
price of one (1) 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 (1) or more of its Subsidiaries to effect any sale or other transfer), in one (1) transaction or a series of related transactions, of more 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 (1) or
more transactions each of which complies with Section 11(o) hereof), (v) to effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or pay any
dividend on the shares of Common Stock payable in shares of Common Stock or to effect a subdivision, combination or consolidation of the shares of Common Stock (by reclassification or otherwise than
by payment of dividends in shares of Common Stock) then, in each such case, the Company shall give to the Rights Agent and to each holder of a Rights Certificate, to the extent feasible (solely in the
case of each holder of a Rights Certificate) 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 the Rights Agent and to each holder of a Rights Certificate, to the extent feasible (solely in the case of each holder of a Rights Certificate) 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 

29

 

first-class mail, postage prepaid, addressed (until another address is filed in writing with the Rights Agent) or by facsimile transmission as follows: 

Haggar
Corp.

6113 Lemmon Avenue

Dallas, Texas 75209

Attention: Chairman of the Board

Facsimile No.: 214-956-4446 

with
a copy to: 

Haggar
Corp.

6113 Lemmon Avenue

Dallas, Texas 75209

Attention: General Counsel

Facsimile No.: 214-956-4561 

Subject
to the provisions of Section 21 hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the 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 with the Company) or by facsimile transmission as
follows: 

Mellon
Investor Services LLC

600 North Pearl Street

Suite 1010

Dallas, Texas 75201-2884

Attention: Relationship Manager

Facsimile No.: 214-922-4477 

with
a copy to: 

Mellon
Investor Services LLC

85 Challenger Road

Ridgefield Park, New Jersey 07660

Attention: General Counsel

Facsimile No.: 201-296-4004 

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 in writing without the approval of any holders of certificates representing shares of Common Stock. From and after 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 this Agreement in writing without the approval
of any holders of Rights Certificates in order (i) to cure any ambiguity, (ii) to correct or supplement any provision contained herein that 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 the provisions hereof in any manner that the Company may deem 

30

 

necessary or desirable and that shall not adversely affect the interests of the holder of Rights Certificates (other than an Acquiring Person or an Affiliate or Associate of an Acquiring Person);  provided,
however, that 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 a time when the Rights are not 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 and, if requested by the Rights
Agent, an opinion of counsel, that states that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent shall execute such supplement or
amendment. Notwithstanding anything contained in this Agreement to the contrary, (a) no supplement or amendment shall be made that changes the Redemption Price, the Final Expiration Date, the
Purchase Price or the number of one one-hundredths of a share of Preferred Stock for which a Right is
exercisable; provided, however, that at any time prior to (i) the existence of an Acquiring Person or (ii) the date that a tender or
exchange offer by any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan or employee stock plan of the Company or any Subsidiary, 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
Rules and Regulations under the Exchange Act, if upon consummation thereof, such Person would be the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding, the Board may amend
this Agreement to increase the Purchase Price and (b) the Rights Agent may, but shall not be obligated to, enter into any supplement or amendment that affects the Rights Agent's own rights,
duties, obligations or immunities under this Agreement and it shall not be bound by any such supplement or amendment not executed by it. 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. 

 
 

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    
  

        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 Rules and Regulations under the Exchange Act. The Board shall have the exclusive power and authority to administer this Agreement and to exercise
all rights and powers specifically granted to the Board or 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 all determinations deemed necessary or advisable for the administration of this Agreement (including a
determination to redeem or not redeem the Rights or to amend this Agreement). All such actions, calculations, interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) that are done or made by the Board (or, where specifically provided for herein, certain specified members thereof) in good faith, shall (x) be
final, conclusive and binding on the Company, the Rights Agent, the holders of the Rights and all other Persons, and (y) not subject the Board to any liability to the holders of the Rights. The
fact that any determination or failure to make a determination hereunder may provide or fail to provide benefits to stockholders, to holders of Rights or to members of the Board shall not in itself be
deemed an absence of good faith on the part of the Board. No member of the Board shall be personally liable for any act or omission in the making or not 

31

 

making of any determination under this Agreement. The Rights Agent is entitled always to assume the Board acted in good faith and shall be fully protected and incur no liability in reliance thereon. 

 
 

Section 30
  Benefits of this Agreement    
  

        Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the holders of the Rights Certificates (and, prior
to the Distribution Date, 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 holders of the Rights Certificates (and, prior to the Distribution Date, 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 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, if it shall have expired, shall be reinstated and such right shall not expire until the Close of Business on
the tenth (10th) Business Day following the date of such determination by the Board. 

        Without
limiting the foregoing, if any provision of this Agreement requiring that a determination be made by less than the entire Board is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, such determination shall then be made by the entire Board. 

 
 

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 NEVADA 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; PROVIDED,
HOWEVER, THAT ALL PROVISIONS REGARDING THE RIGHTS, DUTIES AND OBLIGATIONS OF THE RIGHTS AGENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE. 

 
 

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. 

32

 

 
 

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. 

        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:	 	HAGGAR CORP.
	

By:	
 	

/s/  MARC W. JOSEPH      
 Marc W. Joseph

Senior Vice President and General Counsel	
 	

By:	
 	

/s/  DAVID TEHLE      
 David Tehle

Executive Vice President and Chief Financial Officer
	

 	
 	

 	
 	

MELLON INVESTOR SERVICES LLC, as Rights Agent
	

 	
 	

 	
 	

 	
 	

/s/  DAVID CARY      
 David Cary

Vice President

33

 
 
 

Exhibit A    
  

 
 

Description of Series B Junior
  Participating Preferred Stock    
  

        The dividend to the stockholders of Haggar Corp. (the "Corporation") of the right to purchase one
one-hundredth of a share of the preferred stock of the Corporation, $.10 par value per share, (the "Preferred Stock"), designated as
Series B Junior Participating Preferred Stock ("Series B Junior Participating Preferred Stock"), for each share of Common Stock of the
Corporation owned by such stockholders, shall have the powers, designations, preferences and relative participating, optional and other special rights set forth below upon the terms and subject to the
conditions hereinafter provided. 

 
 

Designation and Amount    
  

        The shares of such series shall be designated as "Series B Junior Participating Preferred Stock" and the number of shares constituting such series shall be
250,000. 

 
 

Dividends and Distributions    
  

        Subject to the prior and superior rights of the holders of any shares of any series of Preferred Stock ranking prior and superior to the shares of Series B
Junior Participating Preferred Stock with respect to dividends, the holders of shares of Series B Junior Participating Preferred Stock shall be entitled to receive, when, as and if declared by
the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the last day of September, December, March and June
in each year (each such date being referred to herein as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date
after the first issuance of a share or fraction of a share of Series B Junior Participating Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of
(a) $5.00 or (b) subject to the provision for adjustment hereinafter set forth, one hundred (100) times the aggregate per share amount of all cash dividends, and one hundred
(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 since the immediately preceding Quarterly Dividend Payment Date, or, with respect
to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series B Junior Participating Preferred Stock. In the event the Corporation shall
at any time after October 21, 2002 (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 B 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 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. 

        At
the end of each quarter, the Corporation shall determine the aggregate per share amount of the dividend or distribution to which the shares of Series B Junior Participating
Preferred Stock are entitled, and shall declare a dividend or distribution on the Series B Junior Participating Preferred Stock on the Quarterly Dividend Payment Date; provided in the event no
dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend
of $5.00 per share on the Series B Junior Participating Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date. 

A-1

 

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

 
 

Voting Rights    
  

        The holders of shares of Series B Junior Participating Preferred Stock shall have the following voting rights: 

        Subject
to the provision for adjustment hereinafter set forth, each share of Series B Junior Participating Preferred Stock shall entitle the holder thereof to one (1) vote
on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time after the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock or (iii) combine the outstanding Common Stock into a smaller number of shares, then in each such case
the number of votes per share to which holders of shares of Series B Junior Participating Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such
number by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event. 

        In
addition to such voting rights as may from time to time be required by the laws of Nevada, the holders of Series B Junior Participating Preferred Stock shall vote at such times
and in a like manner as holders of Common Stock may vote, one (1) vote for each share of Series B Junior Participating Preferred Stock held, and all shares of the Corporation shall be
voted as a single class, except where specifically required by law to vote separately. 

 
 

Certain Restrictions    
  

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

          (i)  declare
or pay dividends on, make any other distributions on (other than dividends or distributions in shares of stock junior to the Series B Junior
Participating Preferred Stock), 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 B Junior Participating Preferred Stock; 

A-2

 

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

        (iii)  except
as permitted by subparagraph (iv) immediately below, 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 B 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 B Junior Participating Preferred Stock; or 

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

        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 the immediately preceding paragraph of this resolution purchase or otherwise acquire such shares at such time and in such manner. 

 
 

Reacquired Shares    
  

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

 
 

Liquidation, Dissolution or Winding Up    
  

        Upon any liquidation (voluntary or otherwise), dissolution or winding up of the Corporation, no distribution shall be made to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series B Junior Participating Preferred Stock unless, prior thereto, the holders of shares of
Series B Junior Participating Preferred Stock shall have received the greater of (a) $100.00 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment or (b) an amount per share, subject to the provision for adjustment hereinafter set forth, equal to one hundred (100) times the
aggregate amount to be distributed per share to holders of Common Stock. 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 to which holders of shares of Series B Participating Junior Preferred Stock were entitled immediately prior to such event pursuant to clause (b) of the preceding sentence
shall be adjusted by 

A-3

 

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. 

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

 
 

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 B Junior Participating Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share (subject to the provision for adjustment hereinafter set forth) equal to one hundred (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 B Junior
Participating Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. 

 
 

Ranking    
  

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

 
 

Amendment    
  

        So long as any shares of Series B Junior Participating Preferred Stock are outstanding, the Articles of Incorporation of the Corporation shall not be
further amended in any manner that would materially alter or change the powers, preferences or special rights of the Series B Junior Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of a majority or more of the outstanding shares of Series B Junior Participating Preferred Stock, voting separately as a class. 

 
 

Fractional Shares    
  

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

A-4

 
 
 

Exhibit B    
  

 
 

Form of Rights Certificate    
  

	Certificate No. R-	 	 	 	_____Rights

NOT
EXERCISABLE AFTER OCTOBER 10, 2012 OR EARLIER IF REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, 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 TERM IS 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.]*

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

 
 

Rights Certificate
  HAGGAR CORP.    
  

        This certifies that                        , or registered assigns,
 is the registered owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights Agreement, dated as of October 10, 2002 (the "Rights Agreement"), between Haggar Corp., a
Nevada corporation (the "Company"), and Mellon Investor Services LLC, a New Jersey limited liability company (the "Rights Agent"), to purchase from the Company at any time prior to 5:00 PM (Dallas,
Texas time) on October 10, 2012 at the office of the Rights Agent designated for such purpose, or its successor as Rights Agent, one one-hundredth (1/100th) of a fully paid,
non-assessable share of Series B Junior Participating Preferred Stock (the "Preferred Stock") of the Company, at a purchase price of $45.00 per one one-hundredth
(1/100th) 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 Purchase Price
may be paid in cash or by certified bank check or bank draft payable to the order of the Company. The number of Rights evidenced by this Rights Certificate (and the number of shares that may be
purchased upon exercise thereof) set forth above, and the Purchase Price per one one-hundredth (1/100th) of a share set forth above, are the number and Purchase Price as of
October 10, 2002 based on the Preferred Stock as constituted at such date. 

        As
provided in the Rights Agreement, the Purchase Price and the number and kind of shares of Preferred Stock or other securities that may be purchased upon the exercise of the Rights
evidenced by this Rights Certificate are subject to modification and adjustment upon the happening of certain events, including a Triggering Event (as such term is defined in the Rights Agreement). 

        This
Rights Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Rights Certificates, which limitations of rights include the temporary 

B-1

 

suspension of the exercisability of such Rights under the specific circumstances set forth in the Rights Agreement. Copies of the Rights Agreement are on file at the principal office of the Company
and are available upon written request to the Company. 

        Upon
the occurrence of a Section 11(a)(ii) Event (as such term is defined in the Rights Agreement), if the Rights evidenced by this Rights Certificate are beneficially
owned by (i) an Acquiring Person or an Affiliate or Associate of such Acquiring Person (as such terms are defined in the Rights Agreement), (iii) 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. 

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

        Subject
to the provisions of the Rights Agreement, the Rights evidenced by this 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 (i) the Close of Business on the Distribution Date (as defined in the Rights Agreement) following the Stock Acquisition Date and (ii) the Final Expiration
Date. 

        In
addition, at any time after a Person becomes an Acquiring Person, the Company may exchange the Rights evidenced by this Certificate for Common Stock of the Company at an exchange
ratio of one (1) share of Common Stock per Right, subject to adjustment as set forth in the Rights Agreement. Notwithstanding the foregoing, no such exchange may be made at any time after any
Person becomes the Beneficial Owner of 50% or more of the outstanding Common Stock of the Company. 

        No
fractional shares of Preferred Stock will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples of one
one-hundredth (1/100th) of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts), but in lieu thereof, a cash payment will be made, as
provided in the Rights Agreement. 

        No
holder of this 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 that may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or, to receive notice of meetings or other actions affecting stockholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this 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-2

 

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

	Dated as of                         ,
20            	 	 	 	 
	

ATTEST:	
 	

HAGGAR CORP.
	

 Secretary	
 	

By:	
 	

 President
	

Countersigned:	
 	

 	
 	

 
	

MELLON INVESTOR SERVICES LLC, as Rights Agent	
 	

 	
 	

 
	

By:	
 	

 Authorized Signature

	
 	

 	
 	

 

B-3

 
[Form of Reverse Side of Rights Certificate]  

FORM OF ASSIGNMENT

(To be executed by the registered holder if such

holder desires to transfer the Rights Certificate.)

        FOR
VALUE RECEIVED ____________________________________________________________

hereby sells, assigns and transfers unto _______________________________________________________ 

(Please print name and address of transferee) 

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

	Dated: _________, 20__.	 	 
	

 	
 	

 Signature
	

Signature Guaranteed:	
 	

 
	

	
 	

 

	*
	Signatures
must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended.
Guarantees by a notary public are not acceptable. 

B-4

 
[Form of Reverse Side of Rights Certificate—continued]

CERTIFICATE  

        The undersigned hereby certifies by checking the appropriate boxes that: 

        (1)  This
Rights Certificate [    ]is [    ] is not being sold, assigned or 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, I [    ] 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: _________, 20__.	 	 
	

 	
 	

 Signature
	

Signature Guaranteed:	
 	

 
	

	
 	

 

	*
	Signatures
must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended.
Guarantees by a notary public are not acceptable. 

Notices  

        The signatures 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. 

        The
signatures to the foregoing Assignment and Certificate also must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated under
the Securities Exchange Act of 1934, as amended. Guarantees by a notary public are not acceptable. 

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

B-5

 
[Form of Reverse Side of Rights Certificate-continued]

FORM OF ELECTION TO PURCHASE

(To be executed if holder desires to exercise

Rights represented by the Rights Certificate.)

To:    HAGGAR
CORP. 

        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 that may be issuable upon the exercise of the Rights) and requests that certificates for such shares be issued in the name of and
delivered to: 

Please
insert social security

or other tax identifying number: ______________________________________________________________ 

(Please print name and address here) 

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

Please
insert social security

or other tax identifying number: ______________________________________________________________ 

(Please print name and address here) 

	Dated: _________, 20__.	 	 
	

 	
 	

 Signature
	

Signature Guaranteed:	
 	

 
	

	
 	

 

	*
	Signatures
must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended.
Guarantees by a notary public are not acceptable. 

B-6

 
[Form of Reverse Side of Rights Certificate-continued]

CERTIFICATE  

        The undersigned hereby certifies by checking the appropriate boxes that: 

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

        (2)  After
due inquiry and to the best knowledge of the undersigned, I [    ] 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: _________, 20__.	 	 
	

 	
 	

 Signature
	

Signature Guaranteed:	
 	

 
	

	
 	

 

	*
	Signatures
must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended.
Guarantees by a notary public are not acceptable. 

Notices  

        The signatures 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. 

        The
signatures to the foregoing Election to Purchase and Certificate must be guaranteed by an "eligible guarantor institution" as defined in Rule 17Ad-15 promulgated
under the Securities Exchange Act of 1934, as amended. Guarantees by a notary public are not acceptable. 

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

B-7

 
 
 

Exhibit C    
  

 
 

SUMMARY OF RIGHTS    
  

        On October 10, 2002, the Board of Directors of Haggar Corp. (the "Company") declared a dividend distribution of one preferred share purchase right (a
"Right") for each outstanding share of common stock, par value $0.10 per share (the "Common Stock") of the Company. The dividend is payable on October 21, 2002 (the "Record Date") to
stockholders of record at that date. Each Right entitles the registered holder to purchase from the Company one one-hundredth of a share of Series B Junior Participating Preferred
Stock, par value $0.10 per share (the "Preferred Stock"), at an exercise price of $45.00 (the "Purchase Price") per one one-hundredth of a share of Preferred Stock, subject to adjustment.
The description and terms of the Rights are set forth in a Rights Agreement (the "Rights Agreement") between the Company and Mellon Investor Services LLC, as Rights Agent. 

        Initially,
the Rights will be evidenced by the Common Stock certificates representing shares then outstanding, and no separate Rights Certificates will be distributed. The Rights will
separate from the Common Stock and a "Distribution Date" will occur at the close of business on the earliest of (i) the tenth business day following a public announcement that a person or group
of affiliated or associated persons (an "Acquiring Person") has acquired, or obtained the right to acquire, beneficial ownership of 15% or more of the outstanding shares of Common Stock (unless the
person becomes the owner of 15% solely by reason of share purchases by the Company or pursuant to an offer for all outstanding
shares of Common Stock determined by at least a majority of the members of the Board of Directors who are not officers of the Company to be at a price and on terms that are fair to stockholders and
otherwise in the best interests of the Company and its stockholders, in which case the rights will not detach unless as a result of actions taken by such person or his affiliates or associates such
person becomes the beneficial owner of 1% or more of the then outstanding shares of Common Stock other than pursuant to a tender or exchange offer as described above) (the "Stock Acquisition Date") or
(ii) the tenth business day following the commencement of a tender offer or exchange offer that would result in a person or group beneficially owning 15% or more of the outstanding shares of
Common Stock (other than a tender offer or exchange offer described in (i) above). The Distribution Date may be extended prior to the expiration of the applicable time period by a majority of
the members of the Board of Directors. 

        Certain
exceptions have been put in the Rights Agreement in order to ensure that descendants of J.M. Haggar, Sr. and their affiliates and associates are not by virtue of their share
ownership automatically deemed to be Acquiring Persons thereby triggering the provisions described herein. 

        Until
the Distribution Date, (i) the Rights will be evidenced by the Common Stock certificates and will be transferred with and only with such Common Stock certificates,
(ii) new Common Stock certificates issued (whether upon transfer or new issuance) after the Record Date will contain a notation incorporating the Rights Agreement by reference and
(iii) the surrender for transfer of any certificate of Common Stock outstanding will also constitute the transfer of the Rights associated with the Common Stock represented by such certificate. 

        The
Rights are not exercisable until the Distribution Date and will expire at the close of business on October 10, 2012, unless earlier redeemed 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. 

C-1

 

        In
the event that (i) a Person becomes an Acquiring Person and a Stock Acquisition Date with respect to such Person shall have occurred or (ii) an Acquiring Person shall
merge into the Company or otherwise combine with the Company and the Company shall be the continuing or surviving corporation of such merger or combination and the Common Stock shall remain
outstanding and unchanged, each holder of a Right will thereafter have the right to receive, upon exercise, 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. However, Rights are not exercisable following the occurrence of either of the events set forth in this paragraph until such
time as the Rights are no
longer redeemable by the Company as set forth below. Notwithstanding any of the foregoing, following the occurrence of either of the events 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. 

        For
example, at an exercise price of $45.00 per Right, each Right not owned by an Acquiring Person (or by certain related parties and transferees) following either of the events set
forth in the preceding paragraph would entitle its holder to purchase $90.00 worth of Common Stock (or other consideration, as noted above), determined pursuant to a formula set forth in the Rights
Agreement, for $45.00. Assuming that the Common Stock had a per share market price of $15.00 at such time, as determined pursuant to such formula, the holder of each valid Right would be entitled to
purchase six shares of Common Stock for $45.00. 

        In
the event that, at any time following the Stock Acquisition Date, (i) the Company is acquired in a merger or other business combination transaction in which the Company is not
the surviving corporation, or in which the Company is the surviving corporation, but its Common Stock is changed or exchanged, or (ii) more than 50% of the Company's assets, cash flow or
earning power is sold or transferred, each holder of a Right (except Rights which previously have 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. 

        At
any time after an Acquiring Person becoming such, the Board of Directors may cause the Company to exchange the Rights (other than Rights owned by the Acquiring Person, which will have
become null and void), in whole or in part, at an exchange ratio of one share of Common Stock per Right (subject to adjustment). Notwithstanding the foregoing, no such exchange may be effected at any
time after any Person (other than the Company and certain of its affiliates) becomes the beneficial owner of 50% or more of the outstanding Common Stock. 

        The
Purchase Price payable, and the number of shares of Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time
to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Preferred Stock, (ii) if holders of the Preferred Stock are granted
certain rights or warrants to subscribe for Preferred Stock or convertible securities at less than the current market price of the Preferred Stock, or (iii) upon the distribution to holders of
the Preferred Stock of evidences of indebtedness or assets (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above). 

        With
certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional shares of Preferred
Stock will be issued, except for integral multiples of one-one hundredth of a share, and, in lieu thereof, an adjustment in cash will be made based on the market price of the Preferred
Stock on the last trading date prior to the date of exercise. 

        At
any time until the close of business on the Distribution Date following the Stock Acquisition Date, the Company may redeem the Rights in whole, but not in part, at a price of $.01 per
Right. Immediately upon the action of the Board of Directors ordering redemption of the Rights, the Rights 

C-2

 

will terminate and the only right of the holders of Rights will be to receive the $.01 per Right redemption price. 

        Although
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 Preferred Stock or Common Stock (or other consideration) of the Company or for common stock of the acquiring company as set forth above or in the event that the
Rights are redeemed. 

        Prior
to the Distribution Date, the Company may amend any of the provisions of the Rights Agreement (other than the redemption price, the expiration date, the number of one
one-hundredths of a share of Preferred Stock, or the purchase price for the Rights, which price may be increased as described below). After the Distribution Date, the Rights Agreement may
be amended by the Company in order to cure any ambiguity, to make changes that do not adversely affect the interests of holders of Rights (excluding the interests of any Acquiring Person), or to
shorten or lengthen any time period under the Rights Agreement; provided, however, that no amendment to adjust the time period governing redemption
shall be made at such time as the Rights are not redeemable. Prior to the existence of an Acquiring Person or the publication of a third party tender offer (if upon consummation of such offer the
offeror would be the beneficial owner of 15% or more of the outstanding Common Stock), the Board may amend the Rights Agreement to increase the purchase price for the Rights. The Rights Agreement
provides that by acceptance of a Right a holder thereof is bound by certain provisions of the Rights Agreement, including without limitation provisions limiting the liability of the Rights Agent in
certain circumstances specified in the Rights Agreement. 

        A
copy of the Rights Agreement will be filed with the Securities and Exchange Commission as an Exhibit to a Registration Statement on Form 8-A filed by the Company. 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-3

QuickLinks

EXHIBIT 4.1

HAGGAR CORP. and MELLON INVESTOR SERVICES LLC, Rights Agent

Rights Agreement Dated as of October 10, 2002

TABLE OF CONTENTS

RIGHTS AGREEMENT

W I T N E S S E T H

Section 1 Certain Definitions

Section 2 Appointment of Rights Agent

Section 3 Issuance of Rights Certificates

Section 4 Form of Rights Certificates

Section 5 Countersignature and Registration

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

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

Section 8 Cancellation and Destruction of Rights Certificates

Section 9 Reservation and Availability of Capital Stock

Section 10 Preferred Stock Record Date

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

Section 12 Certificate of Adjusted Purchase Price or Number of Shares

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

Section 14 Fractional Rights and Fractional Shares

Section 15 Rights of Action

Section 16 Agreement of Rights Holders

Section 17 Rights Certificate Holder Not Deemed a Stockholder

Section 18 Concerning the Rights Agent

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

Section 20 Duties of Rights Agent

Section 21 Change of Rights Agent

Section 22 Issuance of New Rights Certificates

Section 23 Redemption

Section 24 Exchange

Section 25 Notice of Certain Events

Section 26 Notices

Section 27 Supplements and Amendments

Section 28 Successors

Section 29 Determinations and Actions by the Board

Section 30 Benefits of this Agreement

Section 31 Severability

Section 32 GOVERNING LAW

Section 33 Counterparts

Section 34 Descriptive Headings

Exhibit A

Description of Series B Junior Participating Preferred Stock

Designation and Amount

Dividends and Distributions

Voting Rights

Certain Restrictions

Reacquired Shares

Liquidation, Dissolution or Winding Up

Consolidation, Merger, etc.

Ranking

Amendment

Fractional Shares

Exhibit B

Form of Rights Certificate

Rights Certificate HAGGAR CORP.

Exhibit C

SUMMARY OF RIGHTS

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