Document:

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                             WASHINGTON MUTUAL, INC.

                                       and

                MELLON INVESTOR SERVICES, L.L.C., AS RIGHTS AGENT

                                RIGHTS AGREEMENT

                          DATED AS OF December 20, 2000

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                                TABLE OF CONTENTS
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1.  Certain Definitions...........................................................................................1

2.  Appointment Of Rights Agent...................................................................................6

3.  Issuance Of Right Certificates................................................................................6

4.  Form Of Right Certificate.....................................................................................8

5.  Countersignature And Registration.............................................................................8

6.  Transfer, Split-Up, Combination And Exchange Of Right Certificates; Mutilated, Destroyed, Lost Or Stolen
     Right Certificates...........................................................................................9

7.  Exercise Of Rights; Purchase Price; Expiration Date Of Rights................................................10

8.  Cancellation And Destruction Of Right Certificates...........................................................12

9.  Reservation And Availability Of Preferred Stock..............................................................13

10.  Preferred Stock Record Date.................................................................................14

11.  Adjustment Of Purchase Price, Number And Kind Of Shares Or Number Of Rights.................................14

12.  Certificate Of Adjusted Purchase Price Or Number Of Shares..................................................21

13.  Consolidation, Merger Or Sale Or Transfer Of Assets Or Earning Power........................................21

14.  Fractional Rights And Fractional Shares.....................................................................23

15.  Rights Of Action............................................................................................25

16.  Agreement Of Right Holders..................................................................................26

17.  Right Certificate Holder Not Deemed A Stockholder...........................................................26

18.  Concerning The Rights Agent.................................................................................26

19.  Merger Or Consolidation Or Change Of Name Of Rights Agent...................................................27

20.  Duties Of Rights Agent......................................................................................28

21.  Change Of Rights Agent......................................................................................30

22.  Issuance Of New Right Certificates..........................................................................31

23.  Redemption And Termination..................................................................................32

24.  Notice Of Certain Events....................................................................................33

25.  Miscellaneous...............................................................................................34

26.  Exchange....................................................................................................36

27.  Certain Beneficial Owners...................................................................................38

Exhibit A - Form of Certificate of Designation, Preferences and Rights
  of Series RP Preferred Stock..................................................................................A-1

Exhibit B - Form of Right Certificate...........................................................................B-1

Exhibit C - Form of Summary of Rights...........................................................................C-1

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                                RIGHTS AGREEMENT

         This RIGHTS AGREEMENT (the  "Agreement") is made as of this 20th day of
December,  2000 by and between Washington Mutual, Inc., a Washington corporation
(the "Corporation"),  and Mellon Investor Services, L.L.C., a New Jersey limited
liability company (the "Rights Agent"),  with respect to the following facts and
circumstances.

         A.  The  Board  of  Directors  of the  Corporation  (the  "Board")  has
authorized  and declared a dividend of one  preferred  share  purchase  right (a
"Right")  for  each  share of  Common  Stock  (as  hereinafter  defined)  of the
Corporation,  outstanding at the Close of Business (as  hereinafter  defined) on
January  4, 2001 (the  "Record  Date"),  each  Right  representing  the right to
purchase  one  one-thousandth  (1/1000th)  of a share  of  Preferred  Stock  (as
hereinafter  defined),  upon the terms and subject to the conditions  herein set
forth.

         B. The Board of Directors of the Corporation has further authorized and
directed  the  issuance of one Right with  respect to each share of Common Stock
that shall  become  outstanding  between the Record Date and the earliest of the
Distribution  Date, the Redemption  Date or the Final  Expiration  Date (as such
terms are hereinafter  defined);  provided,  however,  that Rights may be issued
with respect to shares of Common Stock that shall become  outstanding  after the
Distribution  Date and prior to the earlier of the Redemption Date and the Final
Expiration  Date  in  accordance  with  the  provisions  of  Section  22 of this
Agreement.

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

     1. Certain Definitions.
        --------------------

     For  purposes of this  Agreement,  the  following  terms have the  meanings
indicated:

          1.1. "Acquiring Person" means, except as otherwise provided in Section
27, any Person who or which, together with all Affiliates and Associates of such
Person,  without the prior  approval of the  Corporation's  Board of  Directors,
shall be the Beneficial  Owner of shares  representing 15% or more of the Voting
Power  (other  than as a result of a Permitted  Offer) or was such a  Beneficial
Owner at any time after the date hereof, whether or not such person continues to
be the Beneficial Owner of shares  representing 15% or more of the Voting Power.
Notwithstanding the foregoing: (A) the term "Acquiring Person" shall not include
(i) the Corporation, (ii) any Subsidiary of the Corporation,  (iii) any employee
benefit plan of the  Corporation or of any Subsidiary of the  Corporation,  (iv)
any Person or entity  organized,  appointed or established by the Corporation or
any Subsidiary of the Corporation for or pursuant to the terms of any such plan,
or (v) any Person who or which,  together with all  Affiliates and Associates of
such Person,  becomes the Beneficial Owner of shares representing 15% or more of
the  Voting  Power as a result of the  acquisition  of  shares  of Common  Stock
directly  from the  Corporation;  and (B) no  Person  shall be  deemed  to be an

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"Acquiring  Person" either (i) as a result of the acquisition of Common Stock by
the  Corporation  which,  by  reducing  the  number of  shares  of Common  Stock
outstanding,  increases the proportional  number of shares beneficially owned by
such  Person  together  with  all  Affiliates  and  Associates  of such  Person;
provided,  however,  that if (X) a Person would become an Acquiring  Person (but
for the operation of this  subclause  (B)(i)) as a result of the  acquisition of
shares of Common Stock by the Corporation,  and (Y) after such share acquisition
by the  Corporation,  such Person,  or an Affiliate or Associate of such Person,
becomes the Beneficial Owner of any additional shares of Common Stock, then such
Person shall be deemed an Acquiring Person, or (ii) if (X) within eight (8) days
after such Person would  otherwise have become an Acquiring  Person (but for the
operation  of this  subclause  (B)(ii)),  such  Person  notifies  the  Board  of
Directors  of the  Corporation  that such  Person did so  inadvertently  and (Y)
within two (2)  Business  Days (as  defined in Section  1.8  hereof)  after such
notification,  such Person is the Beneficial Owner of shares  representing  less
than 15% of the Voting Power.

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

          1.3 "Adjusted Number of Shares" and "Adjusted Purchase Price" have the
respective meanings set forth in Section 11.1.3 hereof.

          1.4.  "Adjustment  Shares" has the meaning set forth in Section 11.1.2
hereof.

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

          1.6. The term  "current per share market price" shall have the meaning
set forth in Section  11.4.1  hereof when used with respect to a "Security"  (as
defined in said Section  11.4.1) and shall have the meaning set forth in Section
11.4.2 when used with respect to the Preferred Stock.

          1.7. A Person is the "Beneficial Owner" of and "beneficially owns" any
securities which:

               1.7.1.  such  Person  or  any  of  such  Person's  Affiliates  or
Associates beneficially owns, directly or indirectly;

               1.7.2.  such  Person  or  any  of  such  Person's  Affiliates  or
Associates  has (A) the right to  acquire  (whether  such  right is  exercisable
immediately  or only  after the  passage  of time)  pursuant  to any  agreement,
arrangement  or  understanding,  or upon  the  exercise  of  conversion  rights,
exchange  rights,  rights  (other than the  Rights),  warrants  or  options,  or
otherwise;  provided,  however, that a Person shall not be deemed the Beneficial
Owner of, or to beneficially  own,  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) the  right to vote  pursuant  to any  agreement,
arrangement  or  understanding;  provided,  however,  that a Person shall not be
deemed the  Beneficial  Owner of, or to  beneficially  own,  any security if the

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agreement,  arrangement or understanding to vote such security (1) arises solely
from a revocable  proxy or consent  given to such Person in response to a public
proxy or consent  solicitation  made  pursuant to, and in accordance  with,  the
applicable rules and regulations  promulgated  under the Exchange Act and (2) is
not also  then  reportable  on  Schedule  13D  under  the  Exchange  Act (or any
comparable or successor report); or

               1.7.3. 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 relating to the acquisition, holding, voting (except to the extent
contemplated by the proviso to subclause (B) of Section 1.7.2),  or disposing of
any securities of the Corporation.

               Notwithstanding anything in this Section 1.7 to the contrary, the
phrase "then  outstanding,"  when used with  reference to a Person's  Beneficial
Ownership  of  securities  of the  Corporation,  shall  mean the  number of such
securities  then  issued  and  outstanding  together  with  the  number  of such
securities not then actually issued and  outstanding  which such Person would be
deemed to own beneficially hereunder.

               Notwithstanding  anything in this Section 1.7 to the contrary, no
Person shall be deemed to  beneficially  own any securities  solely by reason of
such Person being a party to a customary agreement pursuant to which such Person
acts or agrees  to act as an  underwriter  with  respect  to a bona fide  public
offering of securities.

               No decision  reached,  or action taken, by the Board of Directors
of the  Corporation  or any  committee  thereof  shall  cause any Person (or any
Affiliate or Associate of such Person) who is a member of the Board of Directors
of the  Corporation  or such  committee  to be deemed,  for the purposes of this
Agreement,  to be a Beneficial Owner of any securities beneficially owned by any
other  Person (or any  Affiliate or Associate of such Person) who is a member of
the Board of Directors of the  Corporation  or any committee  thereof  solely by
reason of such membership of the Board of Directors or any committee  thereof or
participation  in the decisions or actions thereof on the part of either or both
of such Persons.

          1.8.  "Business Day" means any day other than a Saturday,  a Sunday, a
day on which banking  institutions  in the State of Washington,  New York or New
Jersey are  obligated by law or  executive  order to close,  or a United  States
federal holiday.

          1.9. "Capital Stock  Equivalents" has the meaning set forth in Section
11.1.3 hereof.

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

          1.11. "Common Stock" when used with reference to the Corporation means
the  Common  Stock  of the  Corporation  or,  in  the  event  of a  subdivision,
combination or  consolidation  with respect to such shares of Common Stock,  the
shares  of  Common  Stock  resulting  from  such  subdivision,   combination  or

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consolidation.  "Common Stock" when used with reference to any Person other than
the Corporation  means the capital stock (or equity  interest) with the greatest
voting power of such other  Person or, if such other  Person is a Subsidiary  of
another   Person,   the  Person  or  Persons  which   ultimately   control  such
first-mentioned Person.

          1.12.  "Corporation"  means  Washington  Mutual,  Inc.,  a  Washington
corporation,  and also means a Principal Party to the extent provided in Section
13.1 hereof.

          1.13.  "Distribution  Date" has the  meaning  set forth in Section 3.1
hereof.

          1.14.  "Equivalent  Preferred  Stock"  has the  meaning  set  forth in
Section 11.2 hereof.

          1.15.  "Exchange  Act" means the  Securities  Exchange Act of 1934, as
amended.

          1.16.  "Exchange  Ratio" has the  meaning  set forth in  Section  26.1
hereof.

          1.17. "Final Expiration Date" has the meaning set forth in Section 7.1
hereof.

          1.18.  "Interested  Stockholder"  means  any  Acquiring  Person or any
Affiliate or  Associate of an Acquiring  Person or any other Person in which any
such  Acquiring  Person,  Affiliate or Associate  has an interest,  or any other
Person  acting  directly or  indirectly on behalf of or in concert with any such
Acquiring Person, Affiliate or Associate.

          1.19. "NASDAQ" has the meaning set forth in Section 11.4.1 hereof.

          1.20.  "Permitted Offer" means a tender or exchange offer which is for
all  outstanding  shares of Common  Stock of the  Corporation  at a price and on
terms determined,  prior to the purchase of shares under such tender or exchange
offer,  by at least a majority of the members of the Board of Directors  who are
not officers of the Corporation and who are not Acquiring Persons or Affiliates,
Associates,  nominees or  representatives of an Acquiring Person, to be adequate
(taking into account all factors that such directors  deem pertinent  including,
without limitation,  prices that could reasonably be achieved if the Corporation
or its assets were sold on an orderly basis  designed to realize  maximum value)
and otherwise in the best interests of the Corporation,  its stockholders (other
than the Person or any  Affiliate or Associate  thereof on whose basis the offer
is being  made) and other  relevant  constituencies,  taking  into  account  all
factors that such directors may deem pertinent.

          1.21. "Person" means any individual,  firm, partnership,  corporation,
limited liability company,  limited liability partnership,  trust,  association,
joint  venture  or other  entity,  and  includes  any  successor  (by  merger or
otherwise) of such entity.

          1.22.  "Preferred Stock" means shares of the  Corporation's  Series RP
Preferred  Stock,  par  value  $.01  per  share,  having  the  relative  rights,
preferences and limitations set forth in the Form of Certificate of Designation,
Preferences  and Rights of Series RP Preferred  Stock attached to this Agreement
as Exhibit A.

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          1.23.  "Principal  Party" has the  meaning  set forth in Section  13.2
hereof.

          1.24.  "Proration  Factor" has the meaning set forth in Section 11.1.3
hereof.

          1.25.  "Purchase  Price"  has the  meaning  set forth in  Section  4.1
hereof.

          1.26. "Record Date" has the meaning set forth in Recital A hereof.

          1.27.  "Redemption  Date" has the  meaning  set forth in  Section  7.1
hereof.

          1.28.  "Redemption  Price" has the meaning set forth in Section 23.1.1
hereof.

          1.29.  "Right  Certificate"  has the  meaning set forth in Section 3.1
hereof.

          1.30. "Rights" has the meaning set forth in Recital A hereof.

          1.31. "Rights Agent" means Mellon Investor Services, L.L.C., as Rights
Agent  hereunder,  and, from the time of its  succession,  any successor  Rights
Agent under Section 19 or Section 21 hereof.

          1.32.  "Section  11.1.2  Event" has the  meaning  set forth in Section
11.1.2 hereof.

          1.33.  "Section 13 Event" means any event described in clause (x), (y)
or (z) of Section 13.1 hereof.

          1.34.  "Shares  Acquisition  Date"  means  the  first  date of  public
announcement  (which,  for purposes of this definition,  shall include,  without
limitation,  a report filed pursuant to the Exchange Act) by the  Corporation or
an Acquiring Person that an Acquiring Person has become such or that facts exist
as a result of which there exists an Acquiring Person;  provided,  that, if such
Person is  determined by the Board of Directors of the  Corporation  not to have
become an Acquiring Person pursuant to subclause  (B)(ii) of Section 1.1 hereof,
then no Shares Acquisition Date shall be deemed to have occurred.

          1.35. "Subsidiary" of any Person means any corporation or other Person
of which a majority  of the  voting  power of the voting  equity  securities  or
equity interest is owned, directly or indirectly, by such Person.

          1.36.  "Summary  of Rights"  has the  meaning set forth in Section 3.2
hereof.

          1.37.  "Trading  Day" has the  meaning  set  forth in  Section  11.4.1
hereof.

          1.38. "Triggering Event" means any Section 11.1.2 Event or any Section
13 Event.

          1.39.  "Voting  Power" means the  combined  voting power of the voting
securities of the Corporation,  outstanding on any relevant  determination date,
to vote generally in the election of directors of the Corporation.

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          1.40.  The term  "voting  securities"  has the  meaning  set  forth in
Section 13.1 hereof.

     2. Appointment of Rights Agent.

          2.1. The Corporation  hereby appoints the Rights Agent to act as agent
for the Corporation in accordance with the terms and conditions  hereof, and the
Rights Agent hereby accepts such  appointment.  The Corporation 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.

     3. Issuance of Right Certificates.

          3.1. Until the earlier of (i) the Shares  Acquisition Date or (ii) the
Close  of  Business  on the  tenth  (10th)  day (or  such  later  date as may be
determined by action of the Corporation's  Board of Directors) after the date of
the  commencement by any Person (other than the  Corporation,  any Subsidiary of
the  Corporation,  any  employee  benefit  plan  of  the  Corporation  or of any
Subsidiary of the  Corporation or any Person or entity  organized,  appointed or
established  by the  Corporation  or any  Subsidiary of the  Corporation  for or
pursuant  to the  terms of any such  plan)  of,  or after  the date of the first
public  announcement of the intention of any Person (other than the Corporation,
any Subsidiary of the Corporation,  any employee benefit plan of the Corporation
or of any  Subsidiary  of the  Corporation  or any  Person or entity  organized,
appointed or established by the Corporation or any Subsidiary of the Corporation
for or pursuant to the terms of any such plan) to commence  (which  intention to
commence remains in effect for five (5) Business Days after such  announcement),
a tender or exchange offer the  consummation of which would result in any Person
becoming an Acquiring Person  (including,  in the case of both (i) and (ii), any
such date which is after the date of this Agreement and prior to the issuance of
the Rights) (the "Distribution Date"), (x) the Rights will be evidenced (subject
to the  provisions  of Section  3.2  hereof) by the  certificates  for shares of
Common Stock registered in the names of the holders thereof (which  certificates
shall  also be  deemed  to be  Right  Certificates)  and not by  separate  Right
Certificates,   and  (y)  the  right  to  receive  Right  Certificates  will  be
transferable  only in connection  with the transfer of the underlying  shares of
Common Stock (including a transfer to the Corporation);  provided, however, that
if a tender  or  exchange  offer is  terminated  prior  to the  occurrence  of a
Distribution  Date,  then no  Distribution  Date shall occur as a result of such
tender or exchange offer. As soon as practicable  after the  Distribution  Date,
the Corporation will prepare and execute, the Rights Agent will countersign, and
the Corporation  will send or cause to be sent by  first-class,  postage-prepaid
mail,  to each  record  holder  of  shares  of  Common  Stock as of the Close of
Business on the  Distribution  Date,  at the address of such holder shown on the
records of the Corporation,  a Right  Certificate,  substantially in the form of
Exhibit B hereto (a "Right Certificate"), evidencing one Right for each share of
Common Stock so held. As of and after the Distribution  Date, the Rights will be
evidenced solely by such Right Certificates.

         The Corporation  shall promptly notify the Rights Agent in writing upon
the  occurrence  of the  Distribution  Date and, if such  notification  is given
orally,  the  Corporation  shall  confirm the same in writing on or prior to the
Business Day next following.  Until such notice is received by the Rights Agent,
the Rights Agent may presume conclusively for all purposes that the Distribution
Date has not occurred.

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         3.2.  As  promptly  as  practicable  following  the Record  Date,  the
Corporation will send a copy of a Summary of Rights to Purchase Preferred Stock,
in  substantially  the form of Exhibit C hereto (the  "Summary of  Rights"),  by
first-class,  postage-prepaid  mail,  to each record  holder of shares of Common
Stock as of the Close of  Business  on the Record  Date,  at the address of such
holder shown on the records of the Corporation. With respect to certificates for
shares of Common Stock outstanding as of the Record Date, until the Distribution
Date the Rights will be evidenced by such  certificates  registered in the names
of the holders  thereof  together with a copy of the Summary of Rights  attached
thereto.  Until the Distribution  Date (or the earlier of the Redemption Date or
the Final  Expiration  Date),  the surrender for transfer of any certificate for
shares of Common Stock outstanding on the Record Date, with or without a copy of
the Summary of Rights  attached  thereto,  shall also constitute the transfer of
the Rights associated with such shares of Common Stock.

          3.3.  Certificates for shares of Common Stock that become  outstanding
(including, without limitation, reacquired shares of Common Stock referred to in
the last  sentence of this  Section  3.3) after the Record Date but prior to the
earliest of the  Distribution  Date, the Redemption Date or the Final Expiration
Date,  shall be deemed also 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 a Rights  Agreement  between
                  Washington Mutual, Inc. and Mellon Investor Services,  L.L.C.,
                  as Rights  Agent,  dated as of December  20, 2000 (the "Rights
                  Agreement"), the terms of which are hereby incorporated herein
                  by reference  and a copy of which is on file at the  principal
                  executive  offices of Washington  Mutual,  Inc.  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.  Washington  Mutual,
                  Inc. will mail to the holder of this certificate a copy of the
                  Rights  Agreement  without  charge after  receipt of a written
                  request therefor. Under certain circumstances set forth in the
                  Rights Agreement, Rights issued to, or held by, any Person who
                  is, was or  becomes an  Acquiring  Person or an  Affiliate  or
                  Associate  thereof  (as defined in the Rights  Agreement)  and
                  certain  related  persons,  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
Distribution  Date  the  Rights  associated  with the  shares  of  Common  Stock
represented by such certificates shall be evidenced by such certificates  alone,
and the surrender for transfer of any such certificate shall also constitute the
transfer of the Rights  associated  with the shares of Common Stock  represented

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thereby.  In the event that the Corporation  purchases or acquires any shares of
Common  Stock after the Record Date but prior to the  Distribution  Date (or the
earlier  of the  Redemption  Date or the  Final  Expiration  Date),  any  Rights
associated with such shares of Common Stock shall be deemed canceled and retired
so that the Corporation  shall not be entitled to exercise any Rights associated
with the Common Stock that are no longer outstanding.

     4. Form of Right Certificate.

          4.1. The Right Certificates (and the forms of election to purchase and
of assignment to be printed on the reverse  thereof) shall 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  Corporation  may deem  appropriate  (which  may not  affect  the duties and
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 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 Right Certificates shall entitle the holders thereof
to  purchase  such  number  of one  one-thousandths  (1/1000ths)  of a share  of
Preferred   Stock  as  shall  be  set  forth   therein  at  the  price  per  one
one-thousandth  (1/1000th)  of a share of Preferred  Stock set forth  therein in
accordance  with Section 7.2 hereof (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.

          4.2. Any Right  Certificate  issued pursuant to Section 3.1 or Section
22 hereof that represents  Rights that are null and void pursuant to Section 7.6
of this  Agreement  and any Right  Certificate  issued  pursuant to Section 6 or
Section 11 hereof upon  transfer,  exchange,  replacement  or  adjustment of any
other Right  Certificate  referred to in this  sentence,  shall  contain (to the
extent feasible and upon notice by the Corporation to the Rights Agent that this
Section 4.2 has become applicable) the following legend:

                  The Rights  represented by this Right  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 Right Certificate and the Rights  represented  hereby are
                  null and void.

The  provisions of Section 7.6 of this Agreement  shall be operative  whether or
not the foregoing legend is contained on any such Right Certificate.

     5. Countersignature and Registration.

          5.1.  The  Right  Certificates  shall be  executed  on  behalf  of the
Corporation  by its President or any Executive  Vice President and the Secretary
or an Assistant Secretary, either manually or by facsimile signature, shall have
affixed  thereto the  Corporation's  seal or a facsimile  thereof,  and shall be
attested by the Secretary or an Assistant  Secretary of the Corporation,  either

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manually  or  by  facsimile   signature.   The  Right   Certificates   shall  be
countersigned,  either manually or by facsimile  signature,  by the Rights Agent
and shall  not be valid for any  purpose  unless so  countersigned.  In case any
officer of the Corporation  who shall have signed any of the Right  Certificates
shall cease to be such officer of the Corporation before countersignature by the
Rights  Agent  and  issuance  and  delivery  by  the  Corporation,   such  Right
Certificates  may  nevertheless be  countersigned by the Rights Agent and issued
and  delivered by the  Corporation  with the same force and effect as though the
person who signed such Right  Certificates  had not ceased to be such officer of
the  Corporation;  and any  Right  Certificate  may be  signed  on behalf of the
Corporation by any Person who, at the actual date of the execution of such Right
Certificate,  shall be a proper  officer of the  Corporation  to sign such Right
Certificate,  although at the date of the execution of this Rights Agreement any
such Person was not such an officer.

          5.2.  Following the Distribution Date, and receipt by the Rights Agent
of a list of record holders of Rights, the Rights Agent will keep or cause to be
kept, at its office designated  pursuant to Section 25 hereof as the appropriate
place  for  surrender  or  transfer  of  the  Right   Certificates,   books  for
registration and transfer of the Right Certificates issued hereunder. Such books
shall  show the names  and  addresses  of the  respective  holders  of the Right
Certificates,  the number of Rights  evidenced  on the face of each of the Right
Certificates  and  the  certificate  number  and the  date of each of the  Right
Certificates.

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

          6.1. Subject to the provisions of Section 4.2, Section 7.6 and Section
14 hereof, at any time after the Close of Business on the Distribution Date, and
at or prior to the Close of Business on the  earlier of the  Redemption  Date or
the Final  Expiration Date, any Right  Certificate or Right  Certificates may be
transferred,  split up,  combined or exchanged for another Right  Certificate or
Right Certificates, entitling the registered holder to purchase a like number of
one  one-thousandths  (1/1000ths) of a share of Preferred Stock (or, following a
Triggering Event, other securities, as the case may be) as the Right Certificate
or Right Certificates surrendered then entitled such holder (or former holder in
the case of a transfer) to purchase. Any registered holder desiring to transfer,
split up, combine or exchange any Right Certificate or Right  Certificates shall
make such request in writing  delivered to the Rights Agent, and shall surrender
the  Right  Certificate  or Right  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 Corporation shall be obligated to take
any action whatsoever with respect to the transfer of any such surrendered Right
Certificate until the registered holder shall have properly completed and signed
the certificate  contained in the form of assignment on the reverse side of such
Right  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  Corporation  or the Rights  Agent  shall  reasonably
request.  Thereupon the Rights Agent shall,  subject to Section 4.2, Section 7.6
and Section 14 hereof,  countersign and deliver to the Person entitled thereto a
Right  Certificate or Right  Certificates,  as the case may be, as so requested.
The  Corporation  may require  payment of a sum  sufficient  to cover any tax or
charge  that  may  be  imposed  in  connection  with  any  transfer,  split  up,

                                       9
<PAGE>

combination or exchange of Right Certificates.  The Rights Agent may in its sole
discretion  require  the  Corporation  or the  Person  entitled  to  such  Right
Certificate  to  provide  evidence  that such  payment  has been  made  prior to
countersigning  and  delivering any Right  Certificate  pursuant to this Section
6.1. The Rights Agent shall have no duty or obligation under this Section unless
and until it satisfied that all such taxes and/or charges have been paid.

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

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

          7.1. Subject to Section 7.6 hereof, the registered holder of any Right
Certificate  may  exercise  the Rights  evidenced  thereby  (except as otherwise
provided  herein)  in whole or in part at any time after the  Distribution  Date
upon surrender of the Right  Certificate,  with the form of election to purchase
and the  certificate  on the reverse side thereof duly  executed,  to the Rights
Agent at the office of the Rights Agent  designated  for such purpose,  together
with  payment  of the  aggregate  Purchase  Price  for the  total  number of one
one-thousandths  (1/1000ths) of a share of Preferred Stock (or other securities,
as the case may be) as to which such  surrendered  Rights are  exercised,  at or
prior to the earlier of (i) the Close of Business on January 4, 2011 (the "Final
Expiration Date"), or (ii) the time at which the Rights are redeemed as provided
in Section 23 hereof (the "Redemption Date").

          7.2. The Purchase  Price for each one  one-thousandth  (1/1000th) of a
share of Preferred  Stock pursuant to the exercise of a Right shall initially be
$200.00,  shall be subject to  adjustment  from time to time as  provided in the
next  sentence  and in  Sections  11 and 13.1  hereof  and shall be  payable  in
accordance with paragraph 7.3 below.  Anything in this Agreement to the contrary
notwithstanding,  in the event that at any time after the date of this Agreement
and prior to the Distribution Date, the Corporation shall (i) declare or pay any
dividend  on the  Common  Stock  payable  in  Common  Stock  or  (ii)  effect  a
subdivision,   combination   or   consolidation   of  the   Common   Stock   (by
reclassification  or otherwise  than by payment of dividends in shares of Common
Stock) into a greater or lesser number of shares of Common  Stock,  then, in any
such case, each share of Common Stock  outstanding  following such  subdivision,
combination or consolidation shall continue to have a Right associated therewith
and the  Purchase  Price  following  any such  event  shall  be  proportionately
adjusted  to equal  the  result  obtained  by  multiplying  the  Purchase  Price
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 shall be the total number
of shares of Common Stock  outstanding  immediately  following the occurrence of
such event. The adjustment  provided for in the preceding sentence shall be made
successively whenever such a dividend is declared or paid or such a subdivision,
combination or consolidation is effected.

                                     10
<PAGE>
          7.3.  Upon  receipt of a Right  Certificate  representing  exercisable
Rights, with the form of election to purchase and the certificate on the reverse
side thereof duly executed, accompanied by payment of the Purchase Price for the
Preferred Stock (or other securities, as the case may be) to be purchased and an
amount equal to any applicable  tax or charge  required to be paid by the holder
of such Right  Certificate  in  accordance  with  Section 6 hereof by  certified
check,  cashier's check or money order payable to the order of the  Corporation,
the Rights Agent shall thereupon  promptly (i) (A) requisition from any transfer
agent of the Preferred Stock  certificates for the number of shares of Preferred
Stock to be purchased,  and the Corporation  hereby  irrevocably  authorizes its
transfer agent to comply with all such requests,  or (B) if the Corporation,  in
its sole discretion,  shall have elected to deposit the Preferred Stock issuable
upon exercise of the Rights  hereunder into a depositary,  requisition  from the
depositary  agent   depositary   receipts   representing   such  number  of  one
one-thousandths (1/1000ths) of a share of Preferred Stock as are to be purchased
(in which case certificates for the Preferred Stock represented by such receipts
shall be  deposited  by the transfer  agent with the  depositary  agent) and the
Corporation will direct the depositary agent to comply with such requests,  (ii)
when appropriate, requisition from the Corporation the amount of cash to be paid
in lieu of issuance of fractional  shares in accordance  with Section 14 hereof,
(iii) after receipt of such certificates or depositary receipts,  cause the same
to be  delivered  to or upon the order of the  registered  holder of such  Right
Certificate,  registered  in such  name or  names as may be  designated  by such
holder, and (iv) when appropriate,  after receipt thereof,  deliver such cash to
or upon the order of the  registered  holder of such Right  Certificate.  In the
event that the  Corporation  is obligated to issue other  securities  (including
shares of Common Stock) of the Corporation  pursuant to Section 11.1 hereof, the
Corporation will make all  arrangements  necessary so that such other securities
are available for  distribution  by the Rights Agent,  if and when  necessary to
comply with this Agreement.

          7.4. In addition, in the case of an exercise of the Rights by a holder
pursuant to Section 11.1.2, the Rights Agent shall return such Right Certificate
to the  registered  holder  thereof  after  imprinting,  stamping  or  otherwise
indicating  thereon that the Rights  represented  by such Right  Certificate  no
longer include the rights provided by Section 11.1.2 of the Rights Agreement and
if less  than all the  Rights  represented  by such  Right  Certificate  were so
exercised,  the Rights Agent shall indicate on the Right  Certificate the number
of Rights  represented  thereby that continue to include the rights  provided by
Section 11.1.2.

          7.5.  In case the  registered  holder of any Right  Certificate  shall
exercise less than all the Rights  evidenced  thereby,  a new Right  Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Rights Agent to the registered holder of such Right Certificate or to his
duly authorized  assigns,  subject to the provisions of Section 6 and Section 14
hereof,  or the Rights  Agent shall place an  appropriate  notation on the Right
Certificate with respect to those Rights exercised.

                                       11
<PAGE>

          7.6.  Notwithstanding anything in this Agreement to the contrary, from
and  after  the  first   occurrence  of  a  Section  11.1.2  Event,  any  Rights
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of an
Acquiring Person,  (ii) a transferee of an Acquiring Person (or of any Affiliate
or  Associate  thereof)  who becomes a  transferee  after the  Acquiring  Person
becomes such, or (iii) a transferee of an Acquiring  Person (or of any Affiliate
or Associate thereof) 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 from
any  Affiliate  or  Associate  thereof) to holders of equity  interests  in such
Acquiring  Person  or to  any  Person  with  whom  the  Acquiring  Person  has a
continuing  agreement,  arrangement or  understanding  regarding the transferred
Rights or (B) a transfer  that the Board of  Directors  of the  Corporation  has
determined is part of a plan, arrangement or understanding that has as a primary
purpose or effect the avoidance of this Section 7.6,  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 Corporation shall notify the Rights Agent when this
Section  7.6  applies  and shall use all  reasonable  efforts to insure that the
provisions  of this  Section 7.6 and Section 4.2 hereof are complied  with,  but
neither the  Corporation  nor the Rights  Agent shall have any  liability to any
holder of Right  Certificates  or other Person as a result of the  Corporation's
failure to make any  determinations  with respect to an Acquiring  Person or its
Affiliates, Associates or transferees hereunder.

          7.7.  Notwithstanding  anything  in this  Agreement  to the  contrary,
neither the Rights Agent nor the Corporation shall be obligated to undertake any
action with respect to a registered  holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i)  properly  completed  and signed the  certificate  contained  in the form of
election to  purchase  set forth on the  reverse  side of the Right  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  Corporation  or the Rights  Agent  shall  reasonably
request.

     8. Cancellation and Destruction of Right Certificates.

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

                                       12
<PAGE>

     9. Reservation and Availability of Preferred Stock.

          9.1. The Corporation  covenants and agrees that, at all times prior to
the occurrence of a Section 11.1.2 Event,  it will cause to be reserved and kept
available out of its authorized and unissued  Preferred Stock, or any authorized
and  issued  Preferred  Stock  held in its  treasury,  the  number  of shares of
Preferred  Stock that will be  sufficient  to permit the exercise in full of all
outstanding  Rights and, after the occurrence of a Section 11.1.2 Event,  shall,
to the extent reasonably practicable, so reserve and keep available a sufficient
number of shares of Common Stock (and/or other  securities) that may be required
to permit the exercise in full of the Rights pursuant to this Agreement.

          9.2.  So long  as the  shares  of  Preferred  Stock  (and,  after  the
occurrence  of a Section  11.1.2  Event,  shares  of  Common  Stock or any other
securities)  issuable upon the exercise of the Rights may be listed on any stock
exchange,  the Corporation  shall use its best efforts to cause,  from and after
such time as the  Rights  become  exercisable,  all  shares or other  securities
reserved for such issuance to be listed on such exchange upon official notice of
issuance upon such exercise.

          9.3. The  Corporation  covenants and agrees that it will take all such
action as may be  necessary  to ensure  that all shares of  Preferred  Stock (or
shares of Common Stock and/or other  securities,  as the case may be)  delivered
upon exercise of Rights shall, at the time of delivery of the  certificates  for
such shares or other securities  (subject to payment of the Purchase Price),  be
duly and validly authorized and issued and fully paid and non-assessable  shares
or securities.

          9.4. The  Corporation  covenants  and agrees that it will pay when due
and payable any and all taxes and charges  that may be payable in respect of the
issuance  or delivery of the Right  Certificates  or of any shares of  Preferred
Stock (or shares of Common Stock and/or  other  securities,  as the case may be)
upon the exercise of Rights. The Corporation shall not, however,  be required to
pay any tax or charge that may be payable in respect of any transfer or delivery
of Right  Certificates  to a person  other than,  or the issuance or delivery of
certificates or depositary receipts for the shares of Preferred Stock (or shares
of Common  Stock and/or  other  securities,  as the case may be) in a name other
than that of, the registered holder of the Right  Certificate  evidencing Rights
surrendered  for  exercise,  or to  issue  or to  deliver  any  certificates  or
depositary  receipts  for shares of  Preferred  Stock (or shares of Common Stock
and/or  other  securities,  as the case may be) upon the exercise of any Rights,
until any such tax or governmental  charge shall have been paid (any such tax or
charge  being  payable by the holder of such  Right  Certificate  at the time of
surrender) or until it has been  established to the  Corporation's or the Rights
Agent's reasonable satisfaction that no such tax or charge is due.

          9.5. The  Corporation  shall use its best efforts to (i) file, as soon
as practicable  following the Shares Acquisition Date, a registration  statement
under the Act, with respect to the securities  purchasable  upon exercise of the
Rights on an appropriate form, (ii) cause such registration  statement to become
effective  as soon as  practicable  after  such  filing,  and (iii)  cause  such
registration  statement  to remain  effective  (with a  prospectus  at all times

                                       13
<PAGE>

meeting the  requirements of the Act and the rules and  regulations  thereunder)
until the date of the  expiration  of the  period  for  exercise  of the  Rights
provided by Section 11.1.2. The Corporation will also take such action as may be
appropriate under the blue sky laws of the various states.

     10. Preferred Stock Record Date.

     Each Person in whose name any certificate for shares of Preferred Stock (or
shares of Common Stock and/or  other  securities,  as the case may be) is issued
upon the  exercise of Rights shall for all purposes be deemed to have become the
holder of record of the shares of  Preferred  Stock (or  shares of 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 Right Certificate evidencing
such  Rights was duly  surrendered  and payment of the  Purchase  Price (and any
applicable taxes and governmental charges) was made; provided, however, that, if
the date of such  surrender  and  payment  is a date upon  which  the  shares of
Preferred Stock (or shares of Common Stock and/or other securities,  as the case
may be)  transfer  books of the  Corporation  are closed,  such person  shall be
deemed to have become the record holder of such shares on, and such  certificate
shall be  dated,  the  next  succeeding  Business  Day on which  the  shares  of
Preferred Stock (or shares of Common Stock and/or other securities,  as the case
may be) transfer books of the Corporation are open.

     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.

          11.1. Adjustment Events.

               11.1.1.  In the event the Corporation shall at any time after the
date of this Agreement (A) declare a dividend on the Preferred  Stock payable in
Preferred Stock, (B) subdivide the outstanding  Preferred Stock, (C) combine the
outstanding  Preferred  Stock into a smaller  number of  Preferred  Stock 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  Corporation  is the  continuing or surviving  corporation),
except as otherwise  provided in this  Section 11.1 and Section 7.6 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 capital  stock  issuable  on such  date,  shall be
proportionately  adjusted so that the holder of any Right  exercised  after such
time shall be  entitled to receive  the  aggregate  number and kind of shares of
capital stock that, if such Right had been exercised  immediately  prior to such
date and at a time when the Preferred  Stock transfer  books of the  Corporation
were open,  such holder 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 Right be less than the aggregate par value,  if
any, of the shares of capital stock of the Corporation issuable upon exercise of
one Right.  If an event  occurs  that would  require  an  adjustment  under both

                                       14
<PAGE>

Section 11.1.1 and Section 11.1.2,  the adjustment  provided for in this Section
11.1.1  shall be in  addition  to, and shall be made  prior to,  any  adjustment
required pursuant to Section 11.1.2.

               11.1.2.  In the event (a "Section 11.1.2 Event") that any Person,
alone or together with its Affiliates and Associates,  shall become an Acquiring
Person,  then  proper  provision  shall be made so that  each  holder of a Right
(except as  provided  below and in Section 7.6  hereof)  shall,  for a period of
sixty (60) days (or such longer period as the  Corporation's  Board of Directors
may  determine  at any time prior to or during  such  period of sixty (60) days)
after the later of the  occurrence of any such event or the effective date of an
appropriate registration statement under the Act pursuant to Section 9.5 hereof,
have a right to receive,  upon exercise  thereof in accordance with the terms of
this  Agreement,  at a total  price  equal to the then  current  Purchase  Price
multiplied by the number of one  one-thousandths  of a share of Preferred  Stock
for which a Right is then  exercisable,  such  number of shares of Common  Stock
(or,  in  the  discretion  of  the   Corporation's   Board  of  Directors,   one
one-thousandths  (1/1000ths)  of a share of Preferred  Stock) as shall equal the
result obtained by (x)  multiplying the then current  Purchase Price by the then
number of one  one-thousandths  (1/1000ths)  of a share of  Preferred  Stock for
which a Right was  exercisable  immediately  prior to the first  occurrence of a
Section  11.1.2 Event,  and (y) dividing that product by 50% of the then current
per share market price of the Common Stock (determined  pursuant to Section 11.4
hereof)  on the date of such  first  occurrence  (such  number of  shares  being
referred  to 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 11.1.2.

               11.1.3. In the event that there shall not be sufficient  treasury
or authorized but unissued (and unreserved)  Common Stock to permit the exercise
in full of the Rights in accordance with Section 11.1.2 and the Rights become so
exercisable (and the Board of Directors of the Corporation has not determined to
make the  Rights  exercisable  solely  into  fractions  of a share of  Preferred
Stock),  notwithstanding  any other provision of this  Agreement,  to the extent
necessary and permitted by applicable  law, each Right (except as provided below
and in Section 7.6 hereof) shall thereafter represent the right to receive, upon
exercise thereof at the then current Purchase Price in accordance with the terms
of this  Agreement,  (x) a number of (or  fractions  of) shares of Common  Stock
calculated  by dividing  the maximum  number of shares of Common  Stock that may
permissibly  be issued by the number of  outstanding  Rights and (y) a number of
one one-thousandths  (1/1000ths) of shares of Preferred Stock or a number of, or
fractions of, other equity  securities of the Corporation (or, in the discretion
of the Board of Directors of the Corporation,  debt) that the Board of Directors
of the  Corporation  has  determined to have an aggregate  current  market value
(determined  pursuant to Section 11.1.1 and Section 11.1.2 hereof, to the extent
applicable)  equal to the  difference  between (1) the aggregate  current market
value of the  Adjustment  Shares  (assuming such shares of Common Stock could be
issued  pursuant to Section 11.1.2 hereof) and (2) the aggregate  current market
value of the shares of Common Stock issued in respect of such Right  pursuant to
the  preceding  clause (x) (such number of, or fractions of, shares of Preferred
Stock, debt or other equity securities or debt of the Corporation being referred
to as a "Capital Stock Equivalent");  provided, however, if sufficient shares of
Common  Stock  and/or  Capital  Stock  Equivalents  are  unavailable,  then  the

                                       15
<PAGE>

Corporation  shall,  to the extent  permitted by  applicable  law, take all such
action as may be  necessary to  authorize  additional  shares of Common Stock or
Capital Stock  Equivalents  for issuance upon exercise of the Rights,  including
the calling of a meeting of  stockholders;  and provided,  further,  that if the
Corporation is unable to cause sufficient  shares of Common Stock and/or Capital
Stock  Equivalents  to be available  for issuance  upon  exercise in full of the
Rights,  then each Right  shall  thereafter  represent  the right to receive the
Adjusted Number of Shares upon exercise at the Adjusted  Purchase Price (as such
terms are hereinafter  defined).  As used herein,  the term "Adjusted  Number of
Shares"  shall be equal to that  number of (or  fractions  of)  shares of Common
Stock (and/or Capital Stock  Equivalents) equal to the product of (x) the number
of Adjustment Shares and (y) a fraction, the numerator of which is the number of
shares of Common Stock (and/or Capital Stock Equivalents) available for issuance
upon exercise of the Rights and the denominator of which is the aggregate number
of  Adjustment  Shares  otherwise  issuable  upon exercise in full of all Rights
(assuming  there were a sufficient  number of shares of Common Stock  available)
(such  fraction  being  referred to as the  "Proration  Factor").  The "Adjusted
Purchase  Price" shall mean the product of the Purchase  Price and the Proration
Factor. The Board of Directors of the Corporation may, but shall not be required
to, establish procedures to allocate the right to receive shares of Common Stock
and Capital  Stock  Equivalents  upon  exercise of the Rights  among  holders of
Rights.

          11.2. In case the Corporation shall fix a record date for the issuance
of rights  (other  than the  Rights),  options  or  warrants  to all  holders of
Preferred  Stock  entitling them (for a period  expiring within 60 calendar days
after such record date) to subscribe for or purchase  shares of Preferred  Stock
(or shares having the same rights,  privileges and  preferences as the Preferred
Stock ("Equivalent  Preferred Stock")) or securities  convertible into Preferred
Stock or Equivalent  Preferred  Stock at a price per share of Preferred Stock or
Equivalent  Preferred  Stock  (or  having a  conversion  price per  share,  if a
security  convertible  into shares of Preferred  Stock or  Equivalent  Preferred
Stock) less than the then current per share market price of the Preferred  Stock
(as  determined  pursuant  to Section  11.4  hereof) 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  per  share  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  Right  be less  than the
aggregate par value,  if any, of the shares of capital stock of the  Corporation
issuable upon exercise of one Right. In case such subscription price may be paid
in a consideration  part or all of which shall be in a form other than cash, the
value of such  consideration  shall be  determined in good faith by the Board of
Directors  of the  Corporation,  whose  determination  shall be  described  in a
statement  filed with the Rights  Agent and shall be binding on the Rights Agent
and the holders of the Rights.  Preferred Stock owned by or held for the account
of the Corporation  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 that would
then be in effect if such record date had not been fixed.

                                       16
<PAGE>

          11.3. In case the  Corporation  shall fix a record date for the making
of a  distribution  to all holders of the Preferred  Stock  (including  any such
distribution  made in  connection  with a  consolidation  or merger in which the
Corporation  is  the  continuing  or  surviving  corporation)  of  evidences  of
indebtedness  or assets  (other  than a regular  quarterly  cash  dividend  or a
dividend  payable  in  Preferred  Stock)  or  subscription  rights  or  warrants
(excluding  those referred to in Section 11.2 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 then  current  per  share  market  price  (as
determined  pursuant  to Section  11.4  hereof) of the  Preferred  Stock on such
record  date,  less the fair market  value (as  determined  in good faith by the
Board of Directors of the Corporation, 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) of the  portion of the assets or  evidences  of
indebtedness  so to be  distributed or of such  subscription  rights or warrants
applicable to one share of Preferred  Stock,  and the denominator of which shall
be such  current  per  share  market  price of the  Preferred  Stock;  provided,
however,  that in no event shall the  consideration to be paid upon the exercise
of one Right be less than the  aggregate  par  value,  if any,  of the shares of
capital stock of the  Corporation to be issued upon exercise of one Right.  Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such  distribution  is not so made,  the Purchase  Price shall
again be adjusted to be the Purchase  Price that would then be in effect if such
record date had not been fixed.

          11.4. Computation of "Current Per Share Market Price."

               11.4.1.  For  the  purpose  of  any  computation  hereunder,  the
"current per share market price" of any security (a  "Security"  for the purpose
of this  Section  11.4.1) on any date  shall be deemed to be the  average of the
daily closing prices per share of such Security for the thirty (30)  consecutive
Trading  Days  immediately  prior  to and not  including  such  date;  provided,
however,  that in the  event  that the  current  per share  market  price of the
Security is determined  during a period following the announcement by the issuer
of such Security of (A) a dividend or distribution  on such Security  payable in
shares of such Security or securities  convertible into such shares,  or (B) any
subdivision,  combination or  reclassification of such Security and prior to the
expiration of thirty (30) Trading Days after (but not including) the ex-dividend
date for such dividend or distribution, or the record date for such subdivision,
combination  or  reclassification,  then, and in each such case, the current per
share market price shall be appropriately adjusted to reflect the current market
price per share  equivalent  of such  Security.  The closing  price for each day
shall be the last sale price,  regular way, or, in case no such sale takes place
on such day,  the average of the closing bid and asked  prices,  regular way, in
either case as  reported in the  principal  consolidated  transaction  reporting
system with respect to securities  listed or admitted to trading on the New York
Stock  Exchange  or, if the Security is not listed or admitted to trading on the
New York Stock Exchange, as reported in the principal  consolidated  transaction
reporting  system with respect to securities  listed on the  principal  national

                                       17
<PAGE>

securities  exchange on which the  Security is listed or admitted to trading or,
if the Security is not listed or admitted to trading on any national  securities
exchange,  the last quoted  price or, if not so quoted,  the average of the high
bid and low asked  prices in the  over-the-counter  market,  as  reported by the
National  Association of Securities  Dealers,  Inc. Automated  Quotations System
("NASDAQ")  or such  other  system  then in use,  or,  if on any  such  date the
Security is not quoted by any such organization,  the average of the closing bid
and asked prices as furnished by a professional  market maker making a market in
the Security  selected by the Board of Directors of the  Corporation.  If on any
such date no such  market  maker is making a market  in the  Security,  the fair
value of the Security on such date as  determined  in good faith by the Board of
Directors of the Corporation  shall be used. The term "Trading Day" shall mean a
day on which the principal national securities exchange on which the Security is
listed or admitted to trading is open for the transaction of business or, if the
Security  is not  listed or  admitted  to  trading  on any  national  securities
exchange, a Business Day.

               11.4.2.  For  the  purpose  of  any  computation  hereunder,  the
"current per share market price" of the  Preferred  Stock shall be determined in
accordance  with the  method  set  forth in  Section  11.4.1.  If the  shares of
Preferred Stock are not publicly traded, the "current per share market price" of
the  Preferred  Stock shall be  conclusively  deemed to be the current per share
market  price of the Common  Stock as  determined  pursuant  to  Section  11.4.1
(appropriately  adjusted to reflect any stock split,  stock  dividend or similar
transaction  occurring  after the date hereof),  multiplied by 1,000. If neither
the  Common  Stock nor the  Preferred  Stock are  publicly  held or so listed or
traded,  "current  per share  market  price"  shall  mean,  with  respect to the
Preferred  Stock,  the fair value per share as  determined  in good faith by the
Board of Directors of the Corporation, 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.

          11.5. Anything herein to the contrary  notwithstanding,  no adjustment
in the Purchase Price shall be required unless such adjustment  would require an
increase or decrease of at least 1% in the Purchase  Price;  provided,  however,
that any adjustments  that by reason of this Section 11.5 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 one  one-thousandth  (1/1000th)  of a share of  Preferred
Stock or of any other share or security as the case may be.  Notwithstanding the
first sentence of this Section 11.5, 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 Final Expiration Date.

          11.6. If as a result of an adjustment  made pursuant to Section 11.1.2
or Section  13.1  hereof,  the holder of any Right  thereafter  exercised  shall
become entitled to receive any shares of capital stock of the Corporation  other
than Preferred  Stock,  thereafter the number of other shares so receivable upon
exercise  of any Right  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  Section  11.1  through  11.3,
inclusive,  and the  provisions  of Sections 7, 9, 10, 13 and 14 with respect to
the Preferred Stock shall apply on like terms to any such other shares.

                                       18
<PAGE>

          11.7. All Rights  originally  issued by the Corporation  subsequent to
any adjustment  made to the Purchase Price hereunder shall evidence the right to
purchase,  at the adjusted  Purchase  Price,  the number of one  one-thousandths
(1/1000ths)  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.

          11.8. The Corporation may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights,  in lieu of any adjustment
in the number of one  one-thousandths  (1/1000ths) of a share of Preferred Stock
purchasable upon the exercise of a Right.  Each of the Rights  outstanding after
such  adjustment of the number of Rights shall be exercisable  for the number of
one one-thousandths  (1/1000ths) 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)  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  Corporation  shall make a public  announcement  of its  election to
adjust the number of Rights, indicating the record date for the adjustment, and,
if known at the  time,  the  amount  of the  adjustment  to be made,  and  shall
promptly  deliver a copy of such public  announcement to the Rights Agent.  This
record date may be the date on which the  Purchase  Price is adjusted or any day
thereafter,  but, if the Right Certificates have been issued,  shall be at least
ten  (10)  days  later  than  the  date of the  public  announcement.  If  Right
Certificates  have been  issued,  upon each  adjustment  of the number of Rights
pursuant  to  this  Section  11.8,  the   Corporation   shall,  as  promptly  as
practicable,  cause to be distributed to holders of record of Right Certificates
on such record date Right 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  Corporation,  shall  cause to be
distributed to such holders of record in  substitution  and  replacement for the
Right  Certificates  held by such holders prior to the date of  adjustment,  and
upon surrender thereof,  if required by the Corporation,  new Right Certificates
evidencing  all the Rights to which such  holders  shall be entitled  after such
adjustment.  Right  Certificates so to be distributed shall be issued,  executed
and  countersigned  in the manner provided for herein and shall be registered in
the names of the  holders of record of Right  Certificates  on the  record  date
specified in the public announcement.

          11.9.  Irrespective  of any adjustment or change in the Purchase Price
or the number of one  one-thousandths  (1/1000ths) of a share of Preferred Stock
issuable upon the exercise of the Rights, the Right Certificates theretofore and
thereafter  issued may continue to express the Purchase  Price and the number of
one  one-thousandths  (1/1000ths)  of a  share  of  Preferred  Stock  that  were
expressed in the initial Right Certificates issued hereunder.

          11.10.  Before  taking  any  action  that  would  cause an  adjustment
reducing the Purchase  Price below the then par value,  if any, of the number of
one  one-thousandths  (1/1000ths) of a share of Preferred Stock, share of Common
Stock or other securities  issuable upon exercise of the Rights, the Corporation
shall take any  corporate  action that may, in the  opinion of its  counsel,  be
necessary  in order that the  Corporation  may validly  and  legally  issue such

                                       19
<PAGE>

number of fully paid and  non-assessable  one  one-thousandths  (1/1000ths) of a
share of  Preferred  Stock,  share of Common Stock or other  securities  at such
adjusted Purchase Price.

          11.11.  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 Corporation may elect to defer until the occurrence of such
event the issuance to the holder of any Right  exercised  after such record date
of the  Preferred  Stock,  shares of  Common  Stock or other  securities  of the
Corporation,  if any,  issuable  upon such exercise over and above the Preferred
Stock,  shares of Common Stock or other securities of the  Corporation,  if any,
issuable upon such  exercise on the basis of the Purchase  Price in effect prior
to such adjustment;  provided,  however,  that the Corporation  shall deliver to
such holder a due bill or other appropriate  instrument evidencing such holder's
right to  receive  such  additional  shares  upon the  occurrence  of the  event
requiring  such  adjustment  and  shall  deliver  to the  Rights  Agent a notice
describing the terms of such due bill or other appropriate instrument.

          11.12.  Anything in this Section 11 to the  contrary  notwithstanding,
the Corporation 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 the Corporation in its sole discretion  shall determine to be
advisable in order that any (i)  consolidation  or  subdivision of the Preferred
Stock, (ii) issuance wholly for cash of Preferred Stock at less than the current
market price,  (iii) issuance  wholly for cash of Preferred  Stock or securities
that by their terms are convertible  into or exchangeable  for Preferred  Stock,
(iv) stock dividends or (v) issuance of rights,  options or warrants referred to
in  this  Section  11,  hereafter  made by the  Corporation  to  holders  of its
Preferred Stock shall not be taxable to such holders.

          11.13. The Corporation  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  Corporation  in a  transaction  that does not violate
Section  11.14  hereof),  (ii) merge with or into any other Person (other than a
Subsidiary of the  Corporation  in a transaction  that does not violate  Section
11.14  hereof),  or (iii) sell or transfer (or permit any  Subsidiary to sell or
transfer),  in one transaction,  or a series of related transactions,  assets or
earning  power  aggregating  more than 50% of the assets or earning power of the
Corporation  and its  Subsidiaries  (taken as a whole)  to any  other  Person or
Persons (other than the  Corporation  and/or any of its  Subsidiaries  in one or
more transactions  each of which does not violate Section 11.14 hereof),  if (x)
at the  time  of or  immediately  after  such  consolidation,  merger,  sale  or
transfer,  there are any charter or bylaw provisions or any rights,  warrants or
other  instruments  or securities  outstanding  or agreements in effect or other
actions taken that would materially 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, sale or transfer, the stockholders
of the Person who constitutes,  or would  constitute,  the "Principal Party" for
purposes of Section 13.1 hereof  shall have  received a  distribution  of Rights
previously  owned by such Person or any of its  Affiliates and  Associates.  The
Corporation  shall  not  consummate  any  such  consolidation,  merger,  sale or
transfer  unless prior thereto the  Corporation and such other Person shall have
executed and delivered to the Rights Agent a supplemental  agreement  evidencing
compliance with this Section 11.13.

                                       20
<PAGE>

          11.14.   The  Corporation   covenants  and  agrees  that,   after  the
Distribution  Date,  it will not,  except as  permitted by Section 23 or Section
25.2 hereof,  take (or permit any  Subsidiary to take) any action the purpose of
which is to, or if at the time such action is taken it is reasonably foreseeable
that the effect of such action is to, materially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.

          11.15.  The exercise of Rights under Section  11.1.2 shall only result
in the loss of rights under Section  11.1.2 to the extent so exercised and shall
not otherwise affect the rights  represented by the Rights under this Agreement,
including the rights represented by Section 13.

     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 Corporation shall promptly (a) prepare a certificate  setting forth
such  adjustment  and a  brief,  reasonably  detailed  statement  of the  facts,
computations and methodology  accounting for such adjustment,  (b) file with the
Rights Agent and with each transfer agent for the Common Stock and the Preferred
Stock a copy of such  certificate  and (c) mail a brief summary  thereof to each
holder of a Right Certificate in accordance with Section 25.1 hereof. The Rights
Agent shall be fully  protected  in relying on any such  certificate  and on any
adjustment  therein  contained and shall have no duty with respect to, and shall
not be deemed to have  knowledge of, such  adjustment  unless and until it shall
have received such certificate.

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

          13.1. In the event that, on or following the Shares  Acquisition Date,
directly or indirectly,  (x) the Corporation  shall  consolidate  with, or merge
with and into, any Interested Stockholder or, if in such merger or consolidation
all holders of shares of Common Stock are not treated  alike,  any other Person,
(y) the  Corporation  shall  consolidate  with,  or merge with,  any  Interested
Stockholder  or, if in such  merger or  consolidation  all  holders of shares of
Common Stock are not treated alike, any other Person,  and the Corporation shall
be the  continuing  or surviving  corporation  of such  consolidation  or merger
(other than, in a case of any  transaction  described in (x) or (y), a merger or
consolation  that would result in all of the  securities  generally  entitled to
vote in the  election of  directors  of the  Corporation  ("voting  securities")
outstanding  immediately  prior  thereto  continuing  to  represent  (either  by
remaining  outstanding or by being  converted  into  securities of the surviving
entity) all of the voting securities of the Corporation or such voting surviving
entity  outstanding  immediately  after  such  merger or  consolidation  and the
holders  of such  securities  not having  changed as a result of such  merger or
consolidation),  or (z) the Corporation shall sell or otherwise transfer (or one
or  more  of  its  Subsidiaries  shall  sell  or  otherwise  transfer),  in  one
transaction  or a series  of  related  transactions,  assets  or  earning  power
aggregating  more than 50% of the assets or earning power of the Corporation and
its  Subsidiaries   (taken  as  a  whole)  to  any  Interested   Stockholder  or
Stockholders  or, if in such  transaction  all  holders of Common  Stock are not
treated alike, any other Person (other than the Corporation or any Subsidiary of
the  Corporation  in one or more  transactions  each of which  does not  violate
Section  11.14  hereof),  then,  and in each such case  (except as  provided  in
Section 13.4 hereof),  proper provision shall be made so that (i) each holder of
a Right,  except as provided in Section 7.6 hereof,  shall  thereafter  have the

                                       21
<PAGE>

right to receive  upon  exercise  thereof,  at a total  price  equal to the then
current  Purchase  Price  multiplied by the number of one  one-thousandths  of a
share of Preferred  Stock for which a Right is then  exercisable,  in accordance
with the terms of this Agreement and in lieu of Preferred Stock,  such number of
freely  tradable shares of Common Stock of the Principal  Party,  not subject to
any liens,  encumbrances,  rights of first refusal or other adverse  claims,  as
shall equal the result  obtained by (A)  multiplying  the then current  Purchase
Price by the number of one  one-thousandths  (1/1000ths) of a share of Preferred
Stock for which a Right is then  exercisable  (without  taking into  account any
adjustment previously made pursuant to Section 11.1.2) and dividing that product
by (B) 50% of the then  current per share  market  price of the Common  Stock of
such Principal Party (determined pursuant to Section 11.4 hereof) 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  Corporation  pursuant to this Agreement;
(iii)  the  term  "Corporation"  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;  and (iv) such Principal Party shall take such
steps (including,  but not limited to, the reservation of a sufficient number of
its shares of 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 the
shares of Common Stock thereafter deliverable upon the exercise of the Rights.

          13.2. "Principal Party" shall mean:

               13.2.1. in the case of any transaction described in clause (x) or
(y) of the first  sentence of Section 13.1, the Person that is the issuer of any
securities into which shares of Common Stock of the Corporation 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  (including,  if
applicable, the Corporation if it is the surviving corporation); and

               13.2.2. in the case of any transaction described in clause (z) of
the first sentence of Section 13.1,  the Person that is the party  receiving the
greatest  portion of the assets or earning  power  transferred  pursuant to such
transaction or  transactions;  provided,  however,  that in any of the foregoing
cases,  (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 shares of Common  Stock of which are and have
been so registered,  "Principal Party" shall refer to such other Person;  (2) in
case such  Person is a  Subsidiary,  directly  or  indirectly,  of more than one
Person,  the shares of Common Stock of two or more of which are and have been so
registered,  "Principal  Party"  shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest  aggregate  market value; and (3)
in case such Person is owned, directly or indirectly,  by a joint venture formed
by two or more Persons that are not owned,  directly or indirectly,  by the same
Person,  the rules set  forth in (1) and (2)  above  shall  apply to each of the
chains of  ownership  having an interest in such joint  venture as if such party
were a  "Subsidiary"  of both or all of such joint  venturers  and the Principal
Parties in each such chain shall bear the  obligations set forth in this Section
13 in the same ratio as their  direct or indirect  interests in such Person bear
to the total of such interests.

                                       22
<PAGE>

          13.3. The  Corporation  shall not  consummate any such  consolidation,
merger,  sale or transfer  unless the  Principal  Party shall have a  sufficient
number of its  authorized  shares of 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 Corporation and such Principal
Party shall have  executed  and  delivered  to the Rights  Agent a  supplemental
agreement  providing  for the  terms  set  forth in  Sections  13.1 and 13.2 and
further   providing  that,  as  soon  as  practicable  after  the  date  of  any
consolidation, merger, sale or transfer mentioned in Section 13.1, the Principal
Party at its own expense shall:

               13.3.1.  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 Final Expiration Date;

               13.3.2.  use its best  efforts to qualify or register  the Rights
and the  securities  purchasable  upon exercise of the Rights under the blue sky
laws of such jurisdictions as may be necessary or appropriate; and

               13.3.3.  deliver to holders  of the Rights  historical  financial
statements  for the  Principal  Party  that  comply  in all  respects  with  the
requirements for registration on Form 10 under the Exchange Act.

               The  provisions  of this  Section  13  shall  similarly  apply to
successive  mergers or  consolidations  or sales or other transfers.  The rights
under this Section 13 shall be in addition to the rights to exercise  Rights and
adjustments under Section 11.1.2 and shall survive any exercise thereof.

          13.4.  Notwithstanding anything in this Agreement to the contrary, the
foregoing provisions of this Section 13 shall not be applicable to a transaction
described  in clauses (x) and (y) of Section  13.1 if: (i) such  transaction  is
consummated  with a Person or  Persons  who  acquired  shares  of  Common  Stock
pursuant to a Permitted  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
Permitted Offer; and (iii) the form of consideration offered in such transaction
is the same as the form of consideration  paid pursuant to such Permitted Offer.
Upon consummation of any such transaction contemplated by this Section 13.4, all
Rights hereunder shall expire.

     14. Fractional Rights and Fractional Shares.

          14.1.  The  Corporation  shall not be required to issue  fractions  of
Rights or to distribute Right  Certificates that evidence  fractional Rights. In

                                       23
<PAGE>

lieu of such fractional Rights, there shall be paid to the registered holders of
the  Right  Certificates  with  regard to which  such  fractional  Rights  would
otherwise  be  issuable  an amount  in cash  equal to the same  fraction  of the
current  market value of a whole Right.  For the purposes of this Section  14.1,
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 for any
day shall be the last sale price,  regular  way,  or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal  consolidated  transaction reporting
system with respect to securities  listed or admitted to trading on the New York
Stock  Exchange  or, if the Rights are not listed or  admitted to trading on the
New York Stock Exchange, as reported in the principal  consolidated  transaction
reporting  system with respect to securities  listed on the  principal  national
securities exchange on which the Rights are listed or admitted to trading or, if
the Rights  are not listed or  admitted  to trading on any  national  securities
exchange,  the last quoted  price or, if not so quoted,  the average of the high
bid and low asked prices in the  over-the-counter  market, as reported by NASDAQ
or such  other  system  then in use or, if on any such date the  Rights  are not
quoted by any such organization, the average of the closing bid and asked prices
as  furnished  by a  professional  market  maker  making a market in the  Rights
selected by the Board of  Directors of the  Corporation.  If on any such date no
such market maker is making a market in the Rights, the fair value of the Rights
on such  date as  determined  in good  faith by the  Board of  Directors  of the
Corporation shall be used.

          14.2.  The  Corporation  shall not be required to issue  fractions  of
shares of Preferred  Stock  (other than  fractions  that are one  one-thousandth
(1/1000th) or integral multiples of one one-thousandth  (1/1000th) of a share of
Preferred Stock) upon exercise of the Rights or to distribute  certificates that
evidence fractional shares of Preferred Stock (other than fractions that are one
one-thousandth (1/1000th) or integral multiples of one one-thousandth (1/1000th)
of a share of  Preferred  Stock).  Fractions  of  shares of  Preferred  Stock in
integral  multiples  of one  one-thousandth  (1/1000th)  of a share of Preferred
Stock may, at the  election  of the  Corporation,  be  evidenced  by  depositary
receipts,  pursuant to an appropriate  agreement  between the  Corporation and a
depositary  selected by it;  provided that such agreement shall provide that the
holders of such  depositary  receipts  shall  have the  rights,  privileges  and
preferences  to which they are entitled as  beneficial  owners of the  Preferred
Stock represented by such depositary  receipts.  In lieu of fractional shares of
Preferred Stock that are not one one-thousandth (1/1000th) or integral multiples
of one one-thousandth  (1/1000th) of a share of Preferred Stock, the Corporation
shall  pay to the  registered  holders  of Right  Certificates  at the time such
Rights  are  exercised  as herein  provided  an amount in cash equal to the same
fraction of the current  market value of one share of Preferred  Stock.  For the
purposes of this Section 14.2,  the current market value of a share of Preferred
Stock shall be the closing  price of a share of Preferred  Stock (as  determined
pursuant to Section 11.4.2 hereof) for the Trading Day immediately  prior to the
date of such exercise.

          14.3.  Following the occurrence of one of the  transactions  or events
specified  in  Section 11 giving  rise to the right to receive  shares of Common
Stock,   Capital  Stock  Equivalents  (other  than  Preferred  Stock)  or  other
securities upon the exercise of a Right,  the Corporation  shall not be required
to issue  fractions of shares or units of such shares of Common  Stock,  Capital
Stock  Equivalents  or  other  securities  upon  exercise  of the  Rights  or to
distribute  certificates that evidence fractions of such shares of Common Stock,

                                       24
<PAGE>

Capital Stock Equivalents or other  securities.  In lieu of fractional shares or
units of such  shares  of  Common  Stock,  Capital  Stock  Equivalents  or other
securities,  the  Corporation  may  pay  to  the  registered  holders  of  Right
Certificates  at the time such Rights are exercised as herein provided an amount
in cash equal to the same  fraction  of the current  market  value of a share or
unit of such  shares  of  Common  Stock,  Capital  Stock  Equivalents  or  other
securities. For purposes of this Section 14.3, the current market value shall be
determined  in the manner set forth in Section  11.4  hereof for the Trading Day
immediately  prior to the  date of such  exercise  and,  if such  Capital  Stock
Equivalent  is not traded,  each such Capital  Stock  Equivalent  shall have the
value of one one-thousandth (1/1000th) of a share of Preferred Stock.

          14.4. The holder of a Right by the  acceptance of the Right  expressly
waives such holder's  right to receive any  fractional  Rights or any fractional
share upon  exercise of a Right  (except as provided  above).  The Rights  Agent
shall not be deemed to have  knowledge  of, and shall have no duty or obligation
in respect of, the issuance of fractional Rights or fractional shares unless and
until it shall have received  instructions  (and  sufficient  cash, if required)
from the  Corporation  concerning  the  issuance  of such  fractional  Rights or
fractional shares.

     15. Rights of Action.

          15.1. All rights of action in respect of this Agreement, excepting the
rights of action given to the Rights Agent under  Section 18 hereof,  are vested
in the respective  registered  holders of the Right  Certificates (and, prior to
the  Distribution  Date, the registered  holders of shares of the Common Stock);
and  any  registered   holder  of  any  Right  Certificate  (or,  prior  to  the
Distribution  Date, of shares of the Common  Stock),  without the consent of the
Rights Agent or of the holder of any other Right  Certificate  (or, prior to the
Distribution  Date,  of shares of the Common  Stock),  may,  in such  registered
holder's own behalf and for such registered holder's own benefit,  enforce,  and
may  institute  and  maintain  any  suit,  action  or  proceeding   against  the
Corporation to enforce, or otherwise act in respect of, such registered holder's
right to exercise the Rights  evidenced by such Right  Certificate in the manner
provided in such Right  Certificate and in this Agreement.  Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the  obligations  under,  and  injunctive  relief  against  actual or threatened
violations of the obligations of any Person subject to, this Agreement.  Nothing
in this Section 15 is intended to modify or limit the  authority of the Board of
Directors under Section 25.3.

          15.2.  Notwithstanding  anything in this  Agreement  to the  contrary,
neither the  Corporation  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,  judgment 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,

                                       25
<PAGE>

however,  that the Corporation must use all reasonable  efforts to have any such
injunction,  order, decree, judgment or ruling lifted or otherwise overturned as
soon as practicable.

     16. Agreement of Right Holders.

     Every holder of a Right,  by accepting  the same,  consents and agrees with
the  Corporation  and the Rights  Agent and with every  other  holder of a Right
that:

          16.1. prior to the Distribution  Date, the Rights will be transferable
only in connection with the transfer of the associated shares of Common Stock;

          16.2.  after  the  Distribution   Date,  the  Right  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  form
fully executed;

          16.3. subject to Section 6 and Section 7.7 hereof, the Corporation and
the  Rights  Agent  may deem and  treat  the  Person  in  whose  name the  Right
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
Right  Certificate or the  associated  Common Stock  certificate  made by anyone
other than the Corporation or the Rights Agent) for all purposes whatsoever, and
neither the  Corporation  nor the Rights Agent,  subject to the last sentence of
Section  7.6  hereof,  shall be  required  to be  affected  by any notice to the
contrary; and

     17. Right Certificate Holder Not Deemed a Stockholder.

     No holder,  as such,  of any Right  Certificate  shall be entitled to vote,
receive  dividends  or be deemed  for any  purpose  the  holder of shares of the
Preferred Stock or any other  securities of the Corporation that may at any time
be  issuable  on the  exercise  of the  Rights  represented  thereby,  nor shall
anything  contained  herein or in any Right  Certificate  be construed to confer
upon the  holder  of any  Right  Certificate,  as such,  any of the  rights of a
stockholder  of the  Corporation  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
24 hereof),  or to receive  dividends or other  distributions or to exercise any
preemptive  or  subscription  rights,  or  otherwise,  until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with
the provisions hereof.

     18. Concerning the Rights Agent.

          18.1.  The  Corporation  agrees to pay to the Rights Agent  reasonable
compensation  for all services  rendered by it hereunder and, from time to time,
on demand of the Rights  Agent,  its  reasonable  expenses  and counsel fees and
other  disbursements  incurred  in the  administration,  preparation,  delivery,

                                       26
<PAGE>

amendment and execution of this  Agreement and the exercise and  performance  of
its duties hereunder.  The Corporation 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 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 and  administration of this Agreement,  including
without  limitation  the costs and  expenses of  defending  against any claim of
liability  in respect of any such  action.  The costs and  expenses of enforcing
this  right  of  indemnification  shall  also be paid  by the  Corporation.  The
indemnity provided for herein shall survive the expiration of the Rights and the
termination of this Agreement.

          18.2.  The  Rights  Agent  may  conclusively  rely  upon and  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 the  acceptance and
administration  of this  Agreement  in reliance  upon any Right  Certificate  or
certificate  for  shares  of  Common  Stock  or  for  other  securities  of  the
Corporation,   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  otherwise  upon the  advice of  counsel as set forth in
Section 20 hereof.  The Rights Agent shall not be deemed to have  knowledge  of,
and  shall  have no  duty in  respect  of,  any  fact  contained  in such  Right
Certificate or certificate for shares of Common Stock or for other securities of
the  Corporation,  instrument  of  assignment  or  transfer,  power of attorney,
endorsement,   affidavit,  letter,  notice,  direction,   consent,  certificate,
statement or other paper or document unless and until it shall have received the
same.

          18.3. Anything in this Agreement to the contrary  notwithstanding,  in
no event  shall the Rights  Agent be liable  for  special,  indirect,  punitive,
incidental or consequential loss or damage of any kind whatsoever (including but
not limited to lost  profits),  even if the Rights Agent has been advised of the
likelihood of such loss or damage and regardless of the form of the action.  Any
liability of the Rights Agent under this Agreement will be limited to the amount
of fees paid by the Corporation to the Rights Agent.

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

          19.1.  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 stock
transfer or all or substantially all of 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 that such Person
would be  eligible  for  appointment  as a  successor  Rights  Agent  under  the
provisions of Section 21 hereof.

                                       27
<PAGE>

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

     20. Duties of Rights Agent.

          20.1. The Rights Agent undertakes  those duties and  obligations,  and
only the duties and  obligations,  expressly  imposed by this  Agreement (and no
implied duties or obligations)  upon the following terms and conditions,  and no
implied  duties or  obligations  shall be read into this  Agreement  against the
Rights  Agent,  by all of  which  the  Corporation  and  the  holders  of  Right
Certificates, by their acceptance thereof, shall be bound.

          20.2. Before the Rights Agent acts or refrains from acting, the Rights
Agent  may  consult  with  legal  counsel  (who  may be  legal  counsel  for the
Corporation  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 in good faith and in accordance with
such advice or opinion.

          20.3.  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 an  Acquiring  Person and the
determination  of the  current  market  price  of any  security)  be  proved  or
established by the Corporation prior to taking, suffering or omitting any action
hereunder,  such fact or matter  (unless  other  evidence in respect  thereof be
herein  specifically  prescribed)  may be deemed to be  conclusively  proved and
established by a certificate  signed by any one of the Chairman or Vice Chairman
of the Board, the Chief Executive  Officer,  the President,  any Vice President,
the  Treasurer or the Secretary of the  Corporation  and delivered to the Rights
Agent; and such certificate  shall be full  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 in good faith by it under the  provisions
of this Agreement in reliance upon such certificate.

          20.4.  The Rights  Agent  shall be liable  hereunder  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).

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

                                       28
<PAGE>

          20.6.   The  Rights  Agent  shall  not  be  under  any   liability  or
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 Right  Certificate  (except  its
countersignature  thereof);  nor shall it be  responsible  for any breach by the
Corporation  of any covenant or condition  contained in this Agreement or in any
Rights  Certificate;  nor  shall  it  be  responsible  for  any  change  in  the
exercisability  of the  Rights  (including  the  Rights  becoming  null and void
pursuant to Section 7.6 hereof) or any adjustment  required under the provisions
of Section 11,  Section 13 or Section 26 hereof or  responsible  for the manner,
method or amount of any such adjustment or the  ascertaining of the existence of
facts  that  would  require  any such  adjustment  (except  with  respect to the
exercise  of  Rights  evidenced  by  Right  Certificates  after  receipt  of the
certificate  described in Section 12 hereof);  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  Preferred  Stock or shares of Common  Stock to be
issued pursuant to this Agreement or any Right  Certificate or as to whether any
Preferred  Stock or  shares  of Common  Stock  will,  when  issued,  be  validly
authorized and issued, fully paid and non-assessable.

          20.7.  The   Corporation   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.

          20.8.  The Rights  Agent is hereby  authorized  and directed to accept
instructions  with respect to the  performance of its duties  hereunder from any
one of the Chairman or Vice Chairman of the Board, the Chief Executive  Officer,
the President,  any Vice President or the Secretary of the  Corporation,  and to
apply to such officers for advice or instructions in connection with its duties,
and such instructions  shall be full  authorization and protection of the Rights
Agent and the Rights  Agent  shall incur no  liability  for or in respect of any
action  taken,  suffered  or  omitted  by it in good  faith or lack of action in
accordance  with  instructions  of any such  officer  or for any delay in acting
while waiting for those instructions.  The Rights Agent shall incur no liability
for or in respect of its reliance upon the most recent instructions  received by
any such officer.  Any application by the Rights Agent for written  instructions
from the  Corporation  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 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  shall  not be less  than five (5)
Business Days after the date any officer of the  Corporation  actually  receives
such application,  unless any such officer shall have consented in writing to an
earlier  date)  unless,  prior to taking or  suffering  any such  action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instruction in response to such application  specifying the action to be
taken, suffered or omitted.

          20.9.  The  Rights  Agent and any  stockholder,  affiliate,  director,
officer  or  employee  of the Rights  Agent may buy,  sell or deal in any of the

                                       29
<PAGE>

Rights or other securities of the Corporation or become  pecuniarily  interested
in any transaction in which the Corporation may be interested,  or contract with
or lend money to the  Corporation 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 stockholders,  affiliate, director, officer or employee
from acting in any other capacity for the Corporation or for any other Person or
legal entity.

          20.10.  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,  negligence or  misconduct  of any such  attorneys or agents or for any
loss to the  Corporation  or any  other  Person  resulting  from any  such  act,
default, negligence or misconduct, absent gross negligence, bad faith or willful
misconduct  in the  selection  and  continued  employment  thereof  (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).

          20.11.  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.

          20.12. If, with respect to any Rights  Certificate  surrendered to the
Rights Agent for exercise or transfer,  the certificate  attached to the form of
assignment  or form of  election to  purchase,  as the case may be, has not been
completed,  the Rights  Agent shall not take any further  action with respect to
such  requested   exercise  or  transfer   without  first  consulting  with  the
Corporation.

     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  Corporation  and to each  transfer  agent of the Common  Stock or
Preferred  Stock by  registered  or certified  mail,  and, at the expense of the
Corporation,  to the holders of the Right  Certificates by first-class mail. The
Corporation may remove the Rights Agent or any successor Rights Agent upon sixty
(60) 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 or
Preferred  Stock by  registered or certified  mail,  and to holders of the Right
Certificates by first-class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting,  the Corporation  shall appoint a
successor  to the  Rights  Agent.  If the  Corporation  shall  fail to make such
appointment  within a period of sixty  (60)  days  after  giving  notice of such
removal  or  after  it has been  notified  in  writing  of such  resignation  or
incapacity by the resigning or incapacitated  Rights Agent or by the holder of a
Right Certificate (who shall, with such notice, submit his Right Certificate for
inspection  by the  Corporation),  then  the  registered  holder  of  any  Right
Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent.  Any successor  Rights  Agent,  whether  appointed by the
Corporation  or by such a  court,  shall  be (i) a Person  organized  and  doing

                                       30
<PAGE>

business  under the laws of the  United  States  or of any of the  States of New
York,  New Jersey,  California or Minnesota (or of any other state of the United
States so long as such Person is  authorized to do business in any of the States
of New York, New Jersey,  California or Minnesota),  in good standing, having an
office in any of such States,  which is subject to supervision or examination by
federal or state authority and which (or the parent corporation of which) has at
the time of its appointment as Rights Agent a combined capital and surplus of at
least $50,000,000 or (ii) an affiliate of such 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.  In case at the time such  successor  Rights Agent shall succeed to
the agency created by this Agreement,  any of the Right  Certificates shall have
been countersigned but not delivered,  any such successor Rights Agent may adopt
the  countersignature  of a  predecessor  Rights  Agent and  deliver  such Right
Certificates  so  countersigned;  and in  case  at that  time  any of the  Right
Certificates shall not have been  countersigned,  any successor Rights Agent may
countersign such Right Certificates  either in the name of the predecessor or in
the name of the  successor  Rights  Agent;  and in all  such  cases  such  Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.  Not later than the effective date of any such appointment,  the
Corporation  shall file notice  thereof in writing with the  predecessor  Rights
Agent and each transfer agent of the Common Stock or Preferred Stock, and mail a
notice thereof in writing to the registered  holders of the Right  Certificates.
Failure to give any notice  provided  for in this  Section 21,  however,  or any
defect therein,  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.

     22. Issuance of New Right Certificates.

          22.1.  Notwithstanding  any of the  provisions of this Agreement or of
the Rights to the contrary,  the Corporation may, at its option, issue new Right
Certificates  evidencing  Rights in such form as may be approved by its Board of
Directors  to reflect any  adjustment  or change in the  Purchase  Price and the
number or kind or class of shares or other  securities  or property  purchasable
under the Right  Certificates  made in  accordance  with the  provisions of this
Agreement.

          22.2.  In  connection  with  the  issuance  or  sale of  Common  Stock
following the Distribution  Date and prior to the earlier of the Redemption Date
and the Final  Expiration Date, the Corporation (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,  or upon the  exercise,  conversion or
exchange of securities,  notes or debentures issued by the Corporation,  and (b)
may in any  other  case,  if deemed  necessary  or  appropriate  by the Board of
Directors  of  the  Corporation,   issue  Right  Certificates  representing  the
appropriate number of Rights in connection with such issuance or sale; provided,
however,  that no Right  Certificate shall be issued if, and to the extent that,
appropriate  adjustment  shall  otherwise have been made in lieu of the issuance
thereof.

                                       31
<PAGE>

     23. Redemption and Termination.

          23.1. Redemption

               23.1.1.  The Board of  Directors of the  Corporation  may, at its
option,  redeem  all but not less than all of the then  outstanding  Rights at a
redemption  price  of $.001  per  Right,  as such  amount  may be  appropriately
adjusted  to reflect any stock  split,  stock  dividend  or similar  transaction
occurring  after  the date  hereof  (such  redemption  price  being  hereinafter
referred to as the "Redemption  Price"), at any time prior to the earlier of the
occurrence  of a  Section  11.1.2  Event  or  the  Final  Expiration  Date.  The
Corporation  may, at its option,  pay the  Redemption  Price either in shares of
Common Stock (based on the current per share market price of the Common Stock at
the time of redemption) or cash;  provided that if the Corporation elects to pay
the Redemption  Price in shares of Common Stock,  the  Corporation  shall not be
required to issue any fractional shares of Common Stock and the number of shares
of Common  Stock  issuable to each holder of Rights shall be rounded down to the
next whole share.

               23.1.2.  In addition,  the Board of Directors of the  Corporation
may, at its option,  at any time  following the  occurrence of a Section  11.1.2
Event and the  expiration  of any period  during  which the holder of Rights may
exercise  the Rights  under  Section  11.1.2  but prior to any  Section 13 Event
redeem  all  but  not  less  than  all of the  then  outstanding  Rights  at the
Redemption  Price (x) in connection  with any merger,  consolidation  or sale or
other transfer (in one  transaction or in a series of related  transactions)  of
assets or earning  power  aggregating  50% or more of the  earning  power of the
Corporation  and its  Subsidiaries  (taken as a whole) in which all  holders  of
shares of Common  Stock are  treated  alike and not  involving  (other than as a
holder of shares of Common Stock being  treated like all other such  holders) an
Interested  Stockholder or (y) (i) if and for so long as the Acquiring Person is
not thereafter the Beneficial  Owner of securities  representing  15% or more of
the  Voting  Power,  and (ii) at the time of  redemption  no other  Persons  are
Acquiring Persons.

          23.2.  In the case of a redemption  permitted  under  Section  23.1.1,
immediately  upon the date for  redemption  set forth in (or  determined  in the
manner  specified in) a resolution of the Board of Directors of the  Corporation
ordering  the  redemption  of the Rights,  and  without  any further  action and
without any notice, the right to exercise the Rights will terminate and the only
right  thereafter  of the holders of Rights  shall be to receive the  Redemption
Price for each Right so held. In the case of a redemption  permitted  only under
Section  23.1.2,  the right to exercise the Rights will  terminate and represent
only the  right to  receive  the  Redemption  Price  upon the  later of ten (10)
Business  Days  following  the giving of such  notice or the  expiration  of any
period  during  which the Rights may be  exercised  under  Section  11.1.2.  The
Corporation  shall  promptly  give public  notice of any such  redemption  (with
prompt notice thereof to the Rights Agent); provided,  however, that the failure
to give, or any defect in, any such notice shall not affect the validity of such
redemption.  Within ten (10) days after such date for  redemption set forth in a
resolution of the Board of Directors of the Corporation  ordering the redemption
of the Rights,  the Corporation  shall mail a notice of redemption to the Rights
Agent  and all the  holders  of the then  outstanding  Rights at (in the case of
notice to holders) their addresses as they appear upon the registry books of the
Rights Agent or, prior to the  Distribution  Date, on the registry  books of the

                                       32
<PAGE>

transfer  agent for the Common  Stock.  Any notice which is mailed in the manner
herein  provided shall be deemed given,  whether or not the holder  receives the
notice.  Each  such  notice of  redemption  will  state the  method by which the
payment of the Redemption Price will be made. Neither the Corporation nor any of
its  Affiliates  or  Associates  may redeem,  acquire or purchase  for value any
Rights at any time in any manner  other than as  specifically  set forth in this
Section 23 and other than in  connection  with the  purchase of shares of Common
Stock prior to the Distribution Date.

          23.3.  The  Corporation  may,  at  its  option,  discharge  all of its
obligations with respect to the Rights by (i) issuing a press release announcing
the manner of redemption of the Rights in accordance  with this Agreement  (with
prompt  notice  thereof to the Rights  Agent)  and (ii)  mailing  payment of the
Redemption  Price to the registered  holders of the Rights at their addresses as
they  appear  on the  registry  books  of the  Rights  Agent  or,  prior  to the
Distribution  Date,  on the registry  books of the Transfer  Agent of the Common
Stock, and upon such action, all outstanding Rights and Right Certificates shall
be null and void without any further action by the Corporation.

     24. Notice of Certain Events.

          24.1.  In case the  Corporation  shall propose (i) to pay any dividend
payable in stock of any class to the holders of its  Preferred  Stock or to make
any other  distribution  to the  holders of its  Preferred  Stock  (other than a
regular quarterly cash dividend),  (ii) to offer to the holders of its Preferred
Stock  rights  or  warrants  to  subscribe  for or to  purchase  any  additional
Preferred Stock or shares of stock of any class or any other securities,  rights
or options,  (iii) to effect any  reclassification of its Preferred Stock (other
than a reclassification  involving only the subdivision of outstanding Preferred
Stock), (iv) to effect any consolidation or merger into or with any other Person
(other than a Subsidiary  of the  Corporation  in a  transaction  which does not
violate  Section 11.14  hereof),  or to effect any sale or other transfer (or to
permit one or more of its  Subsidiaries to effect any sale or other transfer) in
one or more  transactions,  of 50% or more of the assets or earning power of the
Corporation  and its  Subsidiaries  (taken as a whole)  to any  other  Person or
Persons (other than the  Corporation  and/or any of its  Subsidiaries  in one or
more transactions  each of which does not violate Section 11.14 hereof),  or (v)
to effect the liquidation,  dissolution or winding up of the Corporation,  then,
in each such case,  the  Corporation  shall  give the  Rights  Agent and to each
holder of a Right Certificate, in accordance with Section 25 hereof, a notice of
such  proposed  action  which shall  specify the record date for the purposes of
such stock dividend or 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 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 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
Preferred Stock, whichever shall be the earlier.

                                       33
<PAGE>

          24.2.  In case of a Section  11.1.2  Event,  then (i) the  Corporation
shall as soon as  practicable  thereafter  give to the Rights  Agent and to each
holder of a Right  Certificate,  in accordance  with Section  25.1.3  hereof,  a
notice of the  occurrence of such event,  which notice shall describe such event
and the  consequences  of such event to holders of Rights under  Section  11.1.2
hereof, and (ii) all references in the preceding Section 24.1 to Preferred Stock
shall be deemed  thereafter to refer also to shares of Common Stock  and/or,  if
appropriate, other securities of the Corporation.

     25. Miscellaneous.

          25.1. Notices.

               25.1.1.  Notices or demands  authorized  by this  Agreement to be
given or made by the Rights Agent or by the holder of any Right  Certificate  to
or on the Corporation shall be sufficiently  given or made if sent by registered
or  certified  mail and shall be deemed  given upon  receipt,  addressed  (until
another address is filed in writing with the Rights Agent) as follows:

                  Washington Mutual, Inc.
                  1201 Third Avenue
                  Seattle, Washington 98101
                  Attention:  Corporate Secretary

               25.1.2.  Subject to the  provisions  of  Section  21 hereof,  any
notice  or  demand  authorized  by this  Agreement  to be  given  or made by the
Corporation or by the holder of any Right  Certificate to or on the Rights Agent
shall be  sufficiently  given or made if sent  registered or certified  mail and
shall be deemed given upon receipt, addressed (until another address is filed in
writing with the Corporation) as follows:

                  Mellon Investor Services, L.L.C.
                  520 Pike Street, Suite 1220
                  Seattle, Washington  98101
                  Attention: Relationship Manager

                  with a copy to:

                  Mellon Investor Services, L.L.C.
                  85 Challenger Road
                  Ridgefield Park, New Jersey 07660-2108
                  Attention:  General Counsel

               25.1.3.  Notices or demands  authorized  by this  Agreement to be
given or made by the  Corporation or the Rights Agent to the holder of any Right
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 Corporation.

                                       34
<PAGE>

          25.2.  Supplements  and  Amendments.  The Corporation may from time to
time supplement or amend any provision of this Agreement without the approval of
any holders of Rights in order to cure any ambiguity, to correct,  supplement or
amend any provision  herein,  or to make any other provision with respect to the
Rights  which  the  Corporation  may  deem  necessary  or  desirable,  any  such
supplement or amendment to be evidenced by a writing  signed by the  Corporation
and the  Rights  Agent;  provided,  however,  that  from and  after  any  Shares
Acquisition  Date this  Agreement  shall not be amended in any manner which will
adversely  affect the interest of the holders of Rights.  Upon the delivery of a
certificate from an appropriate officer of the Corporation which states that the
proposed supplement or amendment is in compliance with the terms of this Section
25.2,  and, if requested by the Rights Agent,  an opinion of counsel that states
that the proposed  supplement  or amendment  complies  with this Section 25, the
Rights  Agent  shall  execute  such  supplement  or  amendment.   Prior  to  the
Distribution  Date,  the  interests  of the  holders  of Rights  shall be deemed
coincident  with the  interests of the holders of shares of Common  Stock.  This
Agreement shall not be amended,  without the prior written consent of the Rights
Agent, in any manner that affects the rights, duties,  obligations or immunities
of the Rights Agent.

          25.3.  Determination  and Actions by the Board of Directors,  etc. The
Board of  Directors  of the  Corporation  shall  have the  exclusive  power  and
authority to  administer  this  Agreement  and to exercise all rights and powers
specifically granted to the Board, or the Corporation, 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,  without limitation, a determination to redeem or not
redeem the Rights or to amend the Agreement  and whether any proposed  amendment
adversely affects the interests of the holders of Right  Certificates).  For all
purposes of this  Agreement,  any  calculation of the number of shares of Common
Stock or other  securities  outstanding  at any particular  time,  including for
purposes of determining the particular  percentage of such outstanding shares of
Common  Stock or any  other  securities  of which any  Person is the  Beneficial
Owner, shall be made in accordance with the last sentence of Rule 13d-3(d)(1)(i)
of the General Rules and Regulations  under the Exchange Act as in effect on the
date of this  Agreement.  All such actions,  calculations,  interpretations  and
determinations  (including, for purposes of clause (y) below, all omissions with
respect  to the  foregoing)  which are done or made by the Board in good  faith,
shall (x) be final, conclusive and binding on the Corporation, the Rights Agent,
the holders of the Right Certificates and all other Persons, and (y) not subject
the Board to any liability to the holders of the Right Certificates.  The Rights
Agent shall be fully protected and shall incur no liability for or in respect of
its  reliance on the good faith of the  Corporation's  Board of  Directors  with
respect to actions done or made in connection with such calculation.  Nothing in
Section 15 hereof is intended to modify or limit this Section 25.3.

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

                                       35
<PAGE>

          25.5.  Benefits of this Agreement.  Nothing in this Agreement shall be
construed to give to any Person or corporation  other than the Corporation,  the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the shares of Common Stock) any legal or equitable right,
remedy or claim under this  Agreement.  This Agreement shall be for the sole and
exclusive  benefit  of the  Corporation,  the  Rights  Agent and the  registered
holders of the Right  Certificates  (and,  prior to the  Distribution  Date, the
shares of Common Stock).

          25.6. 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.

          25.7.  Governing  Law.  This  Agreement,  each  Right  and each  Right
Certificate  issued  hereunder  shall be deemed to be a contract  made under the
laws of the State of  Washington  and for all purposes  shall be governed by and
construed in accordance  with the laws of such State  applicable to contracts to
be made and performed  entirely  within such State,  except that all  provisions
regarding  the  rights,  duties and  obligations  of the Rights  Agent  shall be
governed  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.

          25.8.  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.

          25.9.  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.

     26. Exchange.

          26.1.  Notwithstanding  any  other  provision  hereof,  the  Board  of
Directors of the  Corporation  may, at its option,  at any time after any Person
becomes an Acquiring  Person,  exchange all or part of the then  outstanding and
exercisable  Rights  (which  shall not include  Rights that have become null and
void  pursuant  to the  provisions  of Section  7.6 hereof) for shares of Common
Stock of the  Corporation  at an  exchange  ratio  determined  by  dividing  the
then-applicable exercise price of the Rights determined under Section 7.2 by the
"current per share  market  price" as defined in Section  11.4.1 (such  exchange
ratio being hereinafter  referred to as the "Exchange  Ratio").  Notwithstanding
the foregoing,  the  Corporation's  Board of Directors shall not be empowered to
effect such exchange at any time after any Person  (other than the  Corporation,
any Subsidiary of the Corporation,  any employee benefit plan of the Corporation
or any such Subsidiary, or any Person organized, appointed or established by the
Corporation  for or  pursuant  to the  terms  of any such  plan or any  trustee,
administrator  or fiduciary of such a plan),  together with all  Affiliates  and
Associates of such Person,  becomes the Beneficial Owner of shares  representing
50% or more of the Voting Power.

                                       36
<PAGE>

          26.2.  Immediately  upon the action of the Board of  Directors  of the
Corporation  ordering  the  exchange of any Rights  pursuant to Section 26.1 and
without any further  action and without any notice,  the right to exercise  such
rights  shall  terminate  and the only  right  thereafter  of the holder of such
Rights (other than a holder of Rights that have become null and void pursuant to
the  provisions of Section 7.6 hereof) 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  Corporation  shall promptly give public
notice,  and  shall  promptly  give  notice  to the  Rights  Agent,  of any such
exchange;  provided,  however,  that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange.  The Corporation promptly
shall mail a notice of any such exchange to all of the holders of such Rights at
their last addresses as they appear upon the registry books of the Rights Agent.
Any notice which is mailed in the manner herein  provided shall be deemed given,
whether or not the holder  receives  the  notice.  Each such  notice of exchange
shall state the method by which the exchange of the Common Stock for Rights will
be  effected  and, in the event of any  partial  exchange,  the number of Rights
which will be exchanged.  Any partial  exchange shall be effected pro rata based
on the number of Rights  (other  than  Rights  which have  become  null and void
pursuant to the provisions of Section 7.6) held by each holder of Rights.

          26.3. 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 26, the
Corporation  shall take all such action as may be necessary to issue  additional
shares of Common Stock, Preferred Stock and/or Capital Stock Equivalents with an
aggregate  current  market value (as determined by the Board of Directors of the
Corporation)  equal to the aggregate  current market value of a number of shares
of Common Stock equal to the Exchange Ratio.

                                       37

<PAGE>

          27.  Certain  Beneficial  Owners.  If  any  Person  provides  evidence
satisfactory to the Board of Directors of the Corporation  that such Person was,
as of  immediately  prior to the public  announcement  of the  execution of this
Agreement, the Beneficial Owner of shares representing 15% or more of the Voting
Power,  neither such Person nor any of such  Person's  Affiliates  or Associates
shall be deemed an Acquiring Person solely by reason of such Person's beneficial
ownership of such shares. Such Person shall be deemed an Acquiring Person in the
event that such Person  acquires  beneficial  ownership  of any other  shares of
Common Stock than those referred to in the immediately preceding sentence, which
other shares,  when  aggregated  with any shares  referred to in the immediately
preceding sentence, represent more than 15% of the Voting Power.

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

                                       WASHINGTON MUTUAL, INC.

Attest:
                                       By:
                                       ----------------------------------------
                                       Kerry K. Killinger
                                       Its President and Chief Executive Officer

                                        MELLON INVESTOR
                                        SERVICES, L.L.C., as Rights Agent

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

                                       38

<PAGE>
                          MELLON INVESTOR SERVICES LLC

                                Schedule of Fees
                                       as
                                  Rights AGent
                                      for
                            Washington Mutual, Inc.

================================================================================

Acceptancee Fee                                                        $1,500.00

Annual Administrative Fee                                              $3,500.00
*    Payable at the start of the billing year.

Out-of-Pocket Expenses                                                Additional
*    Legal Review
*    Includes stationary, postage, messenger service charges, etc.

<PAGE>

                                    Exhibit A

                                     Form of
                   Certificate of Designation, Preferences and
                       Rights of Series RP Preferred Stock

                                       of

                             Washington Mutual, Inc.

      (Pursuant toss.23B.06.020 of the Washington Business Corporation Act)

     I,_______________________  ,  Secretary of  Washington  Mutual,  Inc.  (the
"Corporation"),  a  corporation  organized  and  existing  under the  Washington
Business   Corporation  Act,  in  accordance  with  the  provisions  of  Section
23B.01.200 thereof, DO HEREBY CERTIFY:

     That pursuant to the authority conferred upon the Board of Directors of the
Corporation by the Restated Certificate of Incorporation of the Corporation, the
said Board of Directors has adopted the following  resolutions creating a series
of 700,000 shares of Preferred Stock designated as Series RP Preferred Stock.

     RESOLVED, that pursuant to the authority granted to and vested in the Board
of  Directors  of the  Corporation  in  accordance  with the  provisions  of the
Articles of  Incorporation  of the  Corporation,  the Board of Directors  hereby
creates  a series of Series  RP  Preferred  Stock,  with a par value of $.01 per
share,  of the  Corporation  and  hereby  states the  designation  and number of
shares,  and fixes the relative rights,  preferences and limitations  thereof as
follows (the following  provisions  being intended to operate in addition to any
other provisions of said Articles of  Incorporation  applicable to any series of
Preferred Stock):

                            Series RP Preferred Stock

     Section 1.  Designation,  Par Value and  Amount.  The shares of such series
shall be designated as "Series RP Preferred Stock"  (hereinafter  referred to as
"Series RP Preferred Stock"),  the shares of such series shall be with par value
of $.01 per share,  and the number of shares  constituting  such series shall be
700,000;  provided,  however,  that,  if more than a total of 700,000  shares of
Series RP  Preferred  Stock shall be issuable  upon the  exercise of Rights (the
"Rights")  issued  pursuant to the Rights  Agreement,  dated as of December  20,
2000,  between the Corporation and Mellon Investor  Services,  L.L.C., as Rights
Agent (as  amended  from time to time,  the  "Rights  Agreement"),  the Board of
Directors of the  Corporation  shall direct by resolution or resolutions  that a
certificate be properly executed, acknowledged and filed providing for the total
number of shares of Series  RP  Preferred  Stock  authorized  to be issued to be
increased (to the extent that the Articles of Incorporation then permits) to the
largest number of whole shares (rounded up to the nearest whole number) issuable
upon exercise of the Rights.

<PAGE>

     Section 2. Dividends and Distributions.
                ---------------------------

          2.1  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 RP Preferred Stock with respect to dividends, the holders of shares of
Series RP Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of  Directors  out of assets  legally  available  for the  purpose,
quarterly  dividends  payable in cash on the first business day of March,  June,
September and December in each year (each such date being  referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment  Date  after the first  issuance  of a share or  fraction  of a share of
Series RP Preferred  Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment
set forth in Section 6.1, 1,000 times the aggregate per share amount of all cash
dividends,  and 1,000 times the aggregate per share amount  (payable in kind) of
all non-cash dividends or other  distributions  other than a dividend payable in
shares of Common  Stock,  par value  $.01 per  share,  of the  Corporation  (the
"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 RP Preferred Stock.

          2.2 The  Corporation  shall declare a dividend or  distribution on the
Series RP Preferred Stock as provided in Section 2.1 above  immediately after it
declares a dividend or  distribution  on the Common Stock (other than a dividend
payable in shares of Common  Stock);  provided that, in the event no dividend or
distribution  shall have been  declared  on the Common  Stock  during the period
between any Quarterly  Dividend  Payment Date and the next subsequent  Quarterly
Dividend  Payment Date, a dividend of $1.00 per share on the Series RP Preferred
Stock  shall  nevertheless  be payable  on such  subsequent  Quarterly  Dividend
Payment Date.

          2.3 Dividends  shall begin to accrue and be cumulative on  outstanding
shares of Series RP Preferred  Stock from the  Quarterly  Dividend  Payment Date
next  preceding  the date of issue of such shares of Series RP 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 RP 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 RP 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 RP  Preferred
Stock  entitled  to  receive  payment  of a dividend  or  distribution  declared
thereon,  which  record  date  shall be not more than 30 days  prior to the date
fixed for the payment thereof.

                                       2
<PAGE>

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

          3.1 Except as provided in Section 3.3 and subject to the provision for
adjustment  hereinafter set forth, each share of Series RP Preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters  submitted to a vote of
the stockholders of the Corporation.

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

          3.3 The following  additional  provisions  shall apply with respect to
the voting of shares of Series RP Preferred Stock:

               3.3.1 If, on the date used to  determine  stockholders  of record
for any meeting of  stockholders  for the  election of  directors,  a default in
preference  dividends  (as  defined  in  Section  3.3.5  below) on the Series RP
Preferred Stock shall exist,  the holders of the Series RP Preferred Stock shall
have the right,  voting as a class as described in Section 3.3.2 below, to elect
two directors  (in addition to the directors  elected by holders of Common Stock
of the  Corporation).  Such  right  may be  exercised  (a)  at  any  meeting  of
stockholders for the election of directors or (b) at a meeting of the holders of
shares of  Voting  Preferred  Stock (as  hereinafter  defined),  called  for the
purpose  in  accordance  with the  Bylaws  of the  Corporation,  until  all such
cumulative  dividends  (referred to above) shall have been paid in full or until
non-cumulative dividends have been paid regularly for at least one year.

               3.3.2 The right of the  holders of Series RP  Preferred  Stock to
elect  two  directors,  as  described  above,  shall  be  exercised  as a  class
concurrently  with the rights of holders of any other series of Preferred  Stock
upon which voting  rights to elect such  directors  have been  conferred and are
then  exercisable.  The Series RP Preferred  Stock and any additional  series of
Preferred  Stock that the  Corporation  may issue and that may  provide  for the
right to vote with the  foregoing  series of  Preferred  Stock are  collectively
referred to herein as "Voting Preferred Stock."

               3.3.3 Each  director  elected by the  holders of shares of Voting
Preferred  Stock  shall be  referred  to herein  as a  "Preferred  Director."  A
Preferred  Director  shall  continue  to serve  as such for a term of one  year,
except that upon any termination of the right of all holders of Voting Preferred
Stock  to vote  as a class  for  Preferred  Directors,  the  term of  office  of
Preferred Directors then serving shall terminate.  Any Preferred Director may be
removed  by,  and shall not be removed  except  by,  the vote of the  holders of
record of a majority of the  outstanding  shares of Voting  Preferred Stock then
entitled to vote for the election of directors,  present (in person or by proxy)
and voting together as a single class (a) at a meeting of the  stockholders,  or
(b) at a meeting of the holders of shares of such Voting Preferred Stock, called
for the purpose in accordance with the Bylaws of the Corporation.

               3.3.4 So long as a default  in any  preference  dividends  of the
Series RP  Preferred  Stock shall  exist or the  holders of any other  series of

                                       3
<PAGE>

Voting Preferred Stock shall be entitled to elect Preferred  Directors,  (a) any
vacancy in the office of a Preferred  Director may be filled (except as provided
in the following clause (b)) by an instrument in writing signed by the remaining
Preferred  Director  and filed with the  Corporation  and (b) in the case of the
removal of any  Preferred  Director,  the  vacancy  may be filled by the vote or
written consent of the holders of a majority of the outstanding shares of Voting
Preferred Stock then entitled to vote for the election of directors, present (in
person or by proxy) and voting  together as a single class,  at such time as the
removal shall be effected. Each director appointed as aforesaid by the remaining
Preferred  Director shall be deemed,  for all purposes hereof, to be a Preferred
Director.  Whenever  (x) no default  in  preference  dividends  on the Series RP
Preferred  Stock  shall  exist  and (y) the  holders  of other  series of Voting
Preferred  Stock shall no longer be entitled to elect such Preferred  Directors,
then  the  number  of  directors  constituting  the  Board of  Directors  of the
Corporation shall be reduced by two.

               3.3.5 For purposes hereof, a "default in preference dividends" on
the Series RP  Preferred  Stock shall be deemed to have  occurred  whenever  the
amount of cumulative and unpaid dividends on the Series RP Preferred Stock shall
be  equivalent  to  six  full  quarterly  dividends  or  more  (whether  or  not
consecutive),  and,  having so occurred,  such default  shall be deemed to exist
thereafter until, but only until, all cumulative  dividends on all shares of the
Series RP Preferred Stock then outstanding shall have been paid through the last
Quarterly  Dividend  Payment  Date or  until,  but  only  until,  non-cumulative
dividends have been paid regularly for at least one year.

          3.4 Except as set forth herein (or as otherwise required by applicable
law),  holders  of Series RP  Preferred  Stock  shall have no general or special
voting  rights and their  consent shall not be required for taking any corporate
action.

     Section 4. Certain Restrictions.
                --------------------

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

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

               4.1.2 declare or pay dividends,  or make any other distributions,
on any shares of stock  ranking  on a parity  (either  as to  dividends  or upon
liquidation,  dissolution  or winding  up) with the Series RP  Preferred  Stock,
except  dividends  paid  ratably on the Series RP  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;

               4.1.3 redeem or purchase or otherwise  acquire for  consideration
(except as provided in Section 4.1.4 below)  shares of any stock ranking  junior
(either as to dividends or upon  liquidation,  dissolution or winding up) to the

                                       4
<PAGE>

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

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

          4.2 The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise  acquire for  consideration  any shares of stock of the
Corporation  unless the  Corporation  could,  under  Section  4.1,  purchase  or
otherwise acquire such shares at such time and in such manner.

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

     Section 6.  Liquidation, Dissolution or Winding Up.
                 --------------------------------------

          6.1 Subject to the prior and superior  rights of holders of any shares
of any series of  Preferred  Stock  ranking  prior and superior to the shares of
Series RP Preferred Stock with respect to rights upon  liquidation,  dissolution
or winding up (voluntary or  otherwise),  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 RP Preferred Stock unless,
prior  thereto,  the holders of shares of Series RP  Preferred  Stock shall have
received  per share an amount  equal to the  greater of 1,000  times  $200.00 or
1,000 times the payment made per share of Common Stock,  plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment (the "Series RP Liquidation Preference").  Following
the  payment of the full  amount of the  Series RP  Liquidation  Preference,  no
additional  distributions  shall be made to the  holders  of shares of Series RP
Preferred  Stock unless,  prior  thereto,  the holders of shares of Common Stock
shall have received an amount per share (the "Capital  Adjustment") equal to the
quotient  obtained by dividing (i) the Series RP Liquidation  Preference by (ii)
1,000 (as  appropriately  adjusted as set forth in Section  6.3 to reflect  such
events as stock splits,  stock dividends and  recapitalizations  with respect to
the Common Stock) (such number in clause (ii) being hereafter referred to as the
"Adjustment Number").  Following the payment of the full amount of the Series RP
Liquidation  Preference and the Capital Adjustment in respect of all outstanding

                                       5
<PAGE>

shares of Series RP Preferred Stock and Common Stock,  respectively,  holders of
Series RP  Preferred  Stock and  holders of Common  Stock  shall  receive  their
ratable and proportionate share of the remaining assets to be distributed in the
ratio of the  Adjustment  Number to 1 with respect to such  Preferred  Stock and
Common Stock, on a per share basis, respectively.

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

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

     Section 7. Consolidation,  Merger, etc. In case the Corporation shall enter
into any  consolidation,  merger,  combination or other transaction in which the
shares  of  Common  Stock are  exchanged  for or  changed  into  other  stock or
securities,  cash and/or any other property, then in any such case the shares of
Series RP  Preferred  Stock  shall at the same time be  similarly  exchanged  or
changed in an amount per share equal to the Adjustment  Number (as appropriately
adjusted  as set forth in Section 6.3 to reflect  such  events as stock  splits,
stock  dividends and  recapitalizations  with respect to the Common Stock) times
the  aggregate  amount of stock,  securities,  cash  and/or  any other  property
(payable  in kind),  as the case may be,  into  which or for which each share of
Common Stock is changed or exchanged.

     Section 8. No Redemption. The shares of Series RP Preferred Stock shall not
be redeemable.

     Section 9. Ranking.  The Series RP 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 other series shall
provide otherwise.

     Section 10.  Amendment.  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 RP 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 RP Preferred Stock,  voting
separately as a class.

                                       6
<PAGE>

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

     RESOLVED,  that the proper officers of the Corporation be, and each of them
hereby is,  authorized to execute a Certificate of  Designation  with respect to
the Series RP Preferred  Stock pursuant to Section  23B.06.020 of the Washington
Business  Corporation  Act and to take all  appropriate  action  to  cause  such
Certificate to become effective,  including,  but not limited to, the filing and
recording of such Certificate with and/or by the Secretary of State of the State
of Washington.

                  [REST OF PAGE INTENTIONALLY LEFT BLANK]

                                       7
<PAGE>

         IN WITNESS WHEREOF,  I have executed and subscribed to this Certificate
and do affirm the  foregoing as true under penalty of perjury this ____th day of
_____, 2000.

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

                                       8
<PAGE>

                                    Exhibit B

                            Form of Right Certificate

Certificate No. RP-                                                 _____ Rights

                  NOT  EXERCISABLE  AFTER JANUARY 4, 2011 OR EARLIER IF REDEEMED
                  BY THE  CORPORATION.  THE RIGHTS ARE SUBJECT TO  REDEMPTION AT
                  $.001  PER  RIGHT  ON  THE  TERMS  SET  FORTH  IN  THE  RIGHTS
                  AGREEMENT.

                                Right Certificate

                             WASHINGTON MUTUAL, INC.

         This  certifies  that  __________,   or  registered   assigns,  is  the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement,  dated as of December  20,  2000 (the  "Rights  Agreement"),  between
Washington  Mutual,  Inc., a Washington  corporation  (the  "Corporation"),  and
Mellon  Investor  Services,  L.L.C.  (the "Rights  Agent") to purchase  from the
Corporation at any time after the Distribution  Date (as such term is defined in
the Rights  Agreement)  and prior to 5:00 P.M.,  Washington  time, on January 4,
2011, unless the Rights evidenced hereby shall have been previously  redeemed by
the Corporation,  at the office of the Rights Agent designated for such purpose,
or at the office of its successor as Rights Agent, one one-thousandth (1/1000th)
of a  fully  paid  non-assessable  share  of  Series  RP  Preferred  Stock  (the
"Preferred  Stock") of the  Corporation,  at a purchase price of $200.00 per one
one-thousandth  (1/1000th) of a share of Preferred Stock (the "Purchase Price"),
upon  presentation  and  surrender  of this Right  Certificate  with the Form of
Election to Purchase duly executed. The number of Rights evidenced by this Right
Certificate  (and the number of one  one-thousandths  (1/1000ths)  of a share of
Preferred Stock that may be purchased upon exercise hereof) set forth above, and
the  Purchase  Price set forth above,  are the number and  Purchase  Price as of
January 4, 2001, based on the Preferred Stock as constituted at such date.

         Upon the  occurrence of a Section 11.1.2 Event (as such term is defined
in the Rights Agreement),  if the Rights evidenced by this Right Certificate are
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of an
Acquiring Person,  (ii) a transferee of an Acquiring Person (or of any Affiliate
or  Associate  thereof)  who becomes a  transferee  after the  Acquiring  Person
becomes such,  or (iii) a transferee of an Acquiring  Person (or of an Affiliate
or Associate thereof) 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 from
any  Affiliate  or  Associate  thereof) to holders of equity  interests  in such
Acquiring  Person  or to  any  Person  with  whom  the  Acquiring  Person  has a
continuing  agreement,  arrangement or  understanding  regarding the transferred
Rights or (B) a transfer  that the Board of  Directors  of the  Corporation  has
determined is part of a plan, arrangement or understanding that has as a primary
purpose or effect the  avoidance of Section 7.6 of the Rights  Agreement,  shall

<PAGE>

become null and void without any further  action and no holder hereof shall have
any rights  whatsoever with respect to such Rights,  whether under any provision
of the Rights Agreement or otherwise.

         As provided in the Rights Agreement,  the Purchase Price and the number
of one  one-thousandths  (1/1000ths)  of a share  of  Preferred  Stock  or other
securities  that may be purchased  upon the exercise of the Rights  evidenced by
this Right  Certificate  are subject to  modification  and  adjustment  upon the
happening  of  certain  events,  including  Triggering  Events  (as such term is
defined in the Rights Agreement).

         This Right  Certificate  is subject to all of the terms,  covenants and
restrictions of the Rights  Agreement,  which terms,  covenants and restrictions
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 Corporation and the holders of the Right  Certificates,  which
limitations of rights include the temporary  suspension of the exercisability of
such Rights under the specific  circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal executive offices of
the Corporation and the office of the Rights Agent.

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

         Subject to the provisions of the Rights Agreement, the Rights evidenced
by this  Certificate may be redeemed by the Corporation at a redemption price of
$.001 per Right  (subject to  adjustment  as  provided in the Rights  Agreement)
payable in cash.

         No  fractional  shares  of  Preferred  Stock  will be  issued  upon the
exercise of any Right or Rights  evidenced hereby (other than fractions that are
one  one-thousandth  (1/1000th)  or  integral  multiples  of one  one-thousandth
(1/1000th)  of a share of  Preferred  Stock,  which may, at the  election of the
Corporation,  be evidenced by depository  receipts),  but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.

         No  holder  of this  Right  Certificate  shall be  entitled  to vote or
receive  dividends  or be deemed  for any  purpose  the  holder of shares of the
Preferred Stock or of any other  securities of the  Corporation  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 Corporation 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

                                       2
<PAGE>

to receive notice of meetings or other actions affecting stockholders (except as
provided  in  the  Rights   Agreement),   or  to  receive   dividends  or  other
distributions  or  to  exercise  any  preemptive  or  subscription   rights,  or
otherwise,  until the Right or Rights evidenced by this Right  Certificate shall
have been exercised as provided in the Rights Agreement.

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

          WITNESS  the  facsimile  signature  of  the  proper  officers  of  the
Corporation and its corporate seal. Dated as of __________, _____.

[SEAL]
ATTEST:
                                                         WASHINGTON MUTUAL, INC.

By                                      By
  ------------------------------           -------------------------------------

Name                                    Name
    ----------------------------           -------------------------------------

Title                                   Title
     ---------------------------            ------------------------------------

Countersigned:

MELLON INVESTOR SERVICES, L.L.C.

By
  ------------------------------

Name
    ----------------------------

Title
     ---------------------------

                                       3
<PAGE>

                    Form of Reverse Side of Right Certificate

                               FORM OF ASSIGNMENT
                  (To be  executed  by the  registered  holder  if  such  holder
                  desires to transfer the Right Certificate.)

         FOR VALUE RECEIVED
                            ----------------------------------------------------
hereby sells, assigns and transfers unto
                                         ---------------------------------------

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

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

Dated:__________, _____
                                              ----------------------------------
                                              Signature

Signature Guaranteed:

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

         Signatures must be guaranteed by an "Eligible Guarantor Institution" as
defined  in Rule  17Ad-15  (or any  successor  rule or  regulation)  promulgated
pursuant to the Securities Exchange Act of 1934, as amended (this term means, in
general, banks, stock brokers, savings and loan associations, and credit unions,
in each  case with  membership  in an  approved  signature  guarantee  medallion
program).

         The undersigned  hereby certifies that (1) the Rights evidenced by this
Right Certificate are 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  thereof
(as such terms are defined in the Rights Agreement),  (2) this Right Certificate
is not being sold, assigned or transferred to or on behalf of any such Acquiring
Person,  Affiliate  or  Associate,  and (3)  after due  inquiry  and to the best
knowledge  of the  undersigned,  the  undersigned  did not  acquire  the  Rights
evidenced by this Right  Certificate  from any Person who is or was an Acquiring
Person or an Affiliate  or  Associate  thereof (as such terms are defined in the
Rights Agreement).

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

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

                          FORM OF ELECTION TO PURCHASE

                  (To be  executed  by the  registered  holder  if  such  holder
                  desires  to   exercise   Rights   represented   by  the  Right
                  Certificate)

To the Rights Agent:

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

Please insert social security number
or other identifying number
                           -----------------------------------------------------

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

Please insert social security number
or other identifying number
                           -----------------------------------------------------

                         (Please print name and address)
Dated:   __________, _____

                                    Signature
Signature Guaranteed:

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

         Signatures must be guaranteed by an "Eligible Guarantor Institution" as
defined  in Rule  17Ad-15  (or any  successor  rule or  regulation)  promulgated
pursuant to the Securities Exchange Act of 1934, as amended (this term means, in
general, banks, stock brokers, savings and loan associations, and credit unions,
in each  case with  membership  in an  approved  signature  guarantee  medallion
program).

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

         The undersigned  hereby certifies that (1) the Rights evidenced by this
Right  Certificate are not being exercised by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate  thereof (as such terms are
defined in the Rights Agreement),  (2) this Right Certificate is not being sold,
assigned or transferred by or on behalf of any such Acquiring Person,  Affiliate
or  Associate,  and (3)  after  due  inquiry  and to the best  knowledge  of the
undersigned,  the undersigned did not acquire the Rights evidenced by this Right
Certificate from any Person who is or was an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights Agreement).

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

                                     Notice

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

         In  the  event  the  certification  set  forth  above  in the  Form  of
Assignment  or the Form of  Election  to  Purchase,  as the case may be,  is not
completed,  the Corporation and the Rights Agent will deem the Beneficial  Owner
of the Rights  evidenced by this Right  Certificate to be an Acquiring Person or
an  Affiliate  or  Associate  thereof  (as such  terms are  defined in the Right
Agreement) and such Assignment or Election to Purchase will not be honored.

<PAGE>

                                    Exhibit C

                             WASHINGTON MUTUAL, INC.
                                1201 Third Avenue
                            Seattle, Washington 98101

                                     FORM OF
                          SUMMARY OF RIGHTS TO PURCHASE
                           SERIES RP PREFERRED SHARES

         The Board of Directors  (the "Board") of Washington  Mutual,  Inc. (the
"Corporation")  has  declared a dividend  distribution  of one  preferred  share
purchase  right (a  "Right")  for each  outstanding  share of Common  Stock (the
"Common Stock") of the Corporation.  The dividend is payable to the stockholders
of record on January 4, 2001 (the "Record Date"),  and with respect to shares of
Common Stock issued  thereafter until the  Distribution  Date (as defined below)
and, in certain  circumstances,  with  respect to shares of Common  Stock issued
after the  Distribution  Date.  Except as set forth below,  each Right,  when it
becomes  exercisable,  entitles  the  registered  holder  to  purchase  from the
Corporation  one  one-thousandth  (1/1000th)  of a share of Series RP  Preferred
Stock, $.01 par value per share (the "Preferred Stock"), of the Corporation at a
price of $200.00 per one one-thousandth (1/1000th) of a share of Preferred Stock
(the "Purchase Price"), subject to adjustment.  The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights  Agreement") between the
Corporation and Mellon Investor  Services,  L.L.C., as Rights Agent (the "Rights
Agent"), dated as of December 20, 2000.

         Initially, the Rights will be attached to all certificates representing
shares  of  Common  Stock  then  outstanding,   and  no  separate   certificates
representing the Rights ("Right  Certificates") will be distributed.  The Rights
will  separate  from the Common Stock upon the earliest to occur of (i) a person
or group of affiliated or associated persons having acquired,  without the prior
approval  of the  Corporation's  Board of  Directors,  beneficial  ownership  of
securities  which represent 15% or more of the voting power (the "Voting Power")
of the then outstanding voting securities of the Corporation (except pursuant to
a Permitted  Offer, as hereinafter  defined) or (ii) 10 days (or such later date
as the Board may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange  offer the  consummation  of which
would result in a person or group of affiliated or associated  persons  becoming
an Acquiring Person (as hereinafter defined) (the "Distribution Date"). A person
or group whose  acquisitions of shares of Common Stock cause a Distribution Date
pursuant to clause (i) above is an "Acquiring  Person," with certain  exceptions
as set forth in the Rights  Agreement.  The date that a person or group is first
publicly  announced  to have become such by the  Corporation  or such  Acquiring
Person  is the  "Shares  Acquisition  Date."  If any  security  holder  provides
evidence  satisfactory to the Board of beneficial  ownership of shares of Common
Stock  representing  15% or more of the Voting Power as of immediately  prior to
the first public  announcement  of the execution of the Rights  Agreement,  then
such security holder will not be deemed an Acquiring Person with respect to such
securities.

<PAGE>

         The Rights Agreement  provides that,  until the Distribution  Date, the
Rights will be transferred  with and only with the  associated  shares of Common
Stock.  Until the Distribution Date (or earlier  redemption or expiration of the
Rights),  new  Common  Stock  certificates  issued  after the  Record  Date upon
transfer  or new  issuance  of shares of Common  Stock  will  contain a notation
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier  redemption or expiration of the Rights),  the surrender for transfer of
any certificates  for shares of Common Stock  outstanding as of the Record Date,
even  without such  notation or a copy of this Summary of Rights being  attached
thereto,  will also  constitute the transfer of the Rights  associated  with the
shares of Common Stock represented by such  certificate.  As soon as practicable
following  the  Distribution  Date,  Right  Certificates  will be  mailed to the
holders of record of the shares of Common  Stock as of the Close of Business (as
defined in the Rights  Agreement) on the Distribution  Date (and to each initial
record  holder of certain  shares of Common Stock issued after the  Distribution
Date), and such separate Right Certificates alone will evidence the Rights.

         The Rights are not  exercisable  until the  Distribution  Date and will
expire at the close of business on January 4, 2011,  unless earlier  redeemed by
the Corporation as described below.

         In the event  that any  person  becomes  an  Acquiring  Person  (except
pursuant to a tender or exchange  offer which is for all  outstanding  shares of
Common Stock at a price and on terms which a majority of certain  members of the
Board  determines to be adequate and in the best  interests of the  Corporation,
its  stockholders and other relevant  constituencies,  other than such Acquiring
Person, its affiliates and associates (a "Permitted  Offer")),  each holder of a
Right will  thereafter  have the right (the  "Flip-In  Right") to receive,  upon
exercise, the number of shares of Common Stock (or, in certain circumstances, of
one  one-thousandths  (1/1000ths)  of  a  share  of  Preferred  Stock  or  other
securities  of the  Corporation)  having  a  value  (immediately  prior  to such
triggering  event)  equal  to  two  times  the  exercise  price  of  the  Right.
Notwithstanding  the foregoing,  following the occurrence of the event described
above,  all Rights that are, or (under  certain  circumstances  specified in the
Rights  Agreement)  were,  beneficially  owned by any  Acquiring  Person  or any
affiliate or associate  thereof will be null and void. The Board has the option,
at any time after any person  becomes an  Acquiring  Person,  to exchange all or
part of the  then-exercisable  Rights (excluding those that have become void, as
described in the immediately  preceding sentence) for shares of Common Stock, at
an exchange ratio determined by dividing the  then-applicable  Purchase Price by
the  then-current  market  price  per  share of Common  Stock as  determined  in
accordance with the Rights Agreement.  However, this option generally terminates
if any person becomes the beneficial owner of shares representing 50% or more of
the Voting Power.

         In the event that, at any time following the Shares  Acquisition  Date,
(i) the  Corporation  is  acquired  in a merger  or other  business  combination
transaction  in which the  holders  of all of the  outstanding  shares of Common
Stock  immediately  prior to the  consummation  of the  transaction  are not the
holders of all of the surviving  corporation's  voting power,  or (ii) more than
50% of the  Corporation's  assets or earning  power is sold or  transferred,  in
either case with or to (x) an  Acquiring  Person or any  affiliate  or associate
thereof or (y) any other  person in which such  Acquiring  Person,  affiliate or
associate  has an interest or any person  acting on behalf of or in concert with

                                       2
<PAGE>

such Acquiring Person,  affiliate or associate,  or (z) if, in such transaction,
all holders of shares of Common Stock are not treated  alike,  any other person,
then each holder of a Right (except Rights which  previously have been voided as
set forth  above) shall  thereafter  have the right (the  "Flip-Over  Right") to
receive,  upon exercise,  common shares of the acquiring company (or, in certain
circumstances, its parent), having a value equal to two times the exercise price
of the Right.  The holder of a Right will continue to have the  Flip-Over  Right
whether or not such holder exercises or surrenders the Flip-In Right.

         The  Purchase  Price  payable,  and the  number of shares of  Preferred
Stock, shares of Common Stock or other securities issuable, upon exercise of the
Rights are subject to  adjustment  from time to time to prevent  dilution (i) in
the  event  of  a  stock   dividend  on,  or  a   subdivision,   combination  or
reclassification  of,  the  Preferred  Stock,  (ii) upon the grant to holders of
shares of the Preferred  Stock of certain rights or warrants to subscribe for or
purchase  Preferred Stock at a price, or securities  convertible  into Preferred
Stock with a conversion  price,  less than the then current  market price of the
Preferred  Stock or (iii)  upon the  distribution  to  holders  of shares 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).

         The number of outstanding Rights and the number of one  one-thousandths
(1/1000ths)  of a share of Preferred  Stock issuable upon exercise of each Right
are also subject to adjustment in the event of a stock split of the Common Stock
or a stock dividend on the Common Stock payable in Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring,  in any such case,
prior to the Distribution Date.

         Preferred  Stock  purchasable  upon  exercise of the Rights will not be
redeemable.  Each  share  of  Preferred  Stock  will be  entitled  to a  minimum
preferential quarterly dividend payment of $1.00 per share but, if greater, will
be  entitled to an  aggregate  dividend  per share of 1,000  times the  dividend
declared per share of Common Stock. In the event of liquidation,  the holders of
shares  of the  Preferred  Stock  will be  entitled  to a  minimum  preferential
liquidation  payment per share in an amount  equal to the greater of 1,000 times
$200.00 or 1,000 times the payment made per share of Common Stock plus an amount
equal to accrued and unpaid dividends and distributions thereon,  whether or not
declared, to the date of such payment (the "Series RP Liquidation  Preference");
thereafter,  and after the  holders  of shares  of the  Common  Stock  receive a
liquidation  payment of an amount equal to the quotient obtained by dividing the
Series RP Liquidation  Preference by 1,000 (subject to certain  adjustments  for
stock splits, stock dividends and  recapitalizations  with respect to the Common
Stock),  the  holders of shares of the  Preferred  Stock and the  holders of the
Common  Stock  will  share the  remaining  assets in the ratio of 1,000 to 1 (as
adjusted)  for  each  share  of  Preferred  Stock  and  Common  Stock  so  held,
respectively.  Finally,  in the  event  of any  merger,  consolidation  or other
transaction  in which  shares  of  Common  Stock are  exchanged,  each  share of
Preferred  Stock will be entitled to receive 1,000 times the amount received per
share of Common  Stock.  These rights are  protected  by customary  antidilution
provisions.  In the event that the amount of accrued and unpaid dividends on the
Preferred  Stock is  equivalent  to six full  quarterly  dividends or more,  the
holders of shares of the  Preferred  Stock  shall  have the  right,  voting as a
class,  to elect two  directors  in  addition  to the  directors  elected by the
holders of shares of the Common  Stock  until all  cumulative  dividends  on the

                                       3
<PAGE>

Preferred  Stock  have  been  paid or set apart  for  payment  through  the last
quarterly dividend payment date. No fractional shares of Preferred Stock will be
issued (other than fractions which are one one-thousandth (1/1000th) or integral
multiples of one one-thousandth  (1/1000th) of a share of Preferred Stock, which
may, at the election of the  Corporation,  be evidenced by depositary  receipts)
and in lieu  thereof,  an  adjustment  in cash will be made  based on the market
price  of the  Preferred  Stock  on the last  trading  day  prior to the date of
exercise.

         With certain  exceptions,  no adjustment in the Purchase  Price will be
required until  cumulative  adjustments  require an adjustment of at least 1% in
such Purchase Price.

         At any time prior to the  earlier to occur of (i) a person  becoming an
Acquiring  Person or (ii) the expiration of the Rights,  and under certain other
circumstances,  the Corporation may redeem the Rights in whole, but not in part,
at a price (payable in cash or, at the Corporation's  election, in Common Stock)
of $.001 per Right (the "Redemption Price"), which redemption shall be effective
upon the action of the Board.  Additionally,  following  the Shares  Acquisition
Date, the Corporation may redeem the then  outstanding  Rights in whole, but not
in part, at the Redemption Price, provided that such redemption is in connection
with  a  merger  or  other  business   combination   transaction  or  series  of
transactions  involving the Corporation in which all holders of shares of Common
Stock are treated alike but not involving an Acquiring  Person or its affiliates
or associates.

         Other  than  those  provisions  relating  to  the  rights,  duties  and
obligations of the Rights Agent,  all of the provisions of the Rights  Agreement
may be  amended  by the  Board  of  Directors  of the  Corporation  prior to the
Distribution Date, except that the affirmative vote of the holders of a majority
of the then  outstanding  Rights  (excluding  Rights  which have  become void in
accordance  with the Rights  Agreement)  will be required  (i) to  increase  the
Purchase  Price,  to reduce the price at which the Rights may be redeemed and/or
to amend,  in a manner  adverse to the  interests of the holders of Rights,  the
exchange  ratio of  rights  for  shares of Common  Stock  and (ii)  following  a
Distribution  Date, to supplement or amend any provision of the Rights Agreement
or the Rights in any other respect.

         Until a Right is exercised,  the holder thereof,  as such, will have no
rights as a stockholder of the Corporation,  including,  without limitation, the
right to vote or to receive dividends. While the distribution of the Rights will
not be taxable to stockholders of the Corporation,  stockholders may,  depending
upon the  circumstances,  recognize  taxable  income  should the  Rights  become
exercisable or upon the occurrence of certain events thereafter.

         A copy of the Rights  Agreement has been filed with the  Securities and
Exchange  Commission  as an Exhibit to a  Registration  Statement on Form 8-A. A
copy of the Rights  Agreement is available free of charge from the  Corporation.
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 hereby
incorporated herein by reference.

                                       4--------------------------------------------------------------------------------

                             WASHINGTON MUTUAL, INC.

                                       and

                MELLON INVESTOR SERVICES, L.L.C., AS RIGHTS AGENT

                                RIGHTS AGREEMENT

                          DATED AS OF December 20, 2000

--------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>

                                TABLE OF CONTENTS
                                                                                                               PAGE
<S>                                                                                                            <C>
1.  Certain Definitions...........................................................................................1

2.  Appointment Of Rights Agent...................................................................................6

3.  Issuance Of Right Certificates................................................................................6

4.  Form Of Right Certificate.....................................................................................8

5.  Countersignature And Registration.............................................................................8

6.  Transfer, Split-Up, Combination And Exchange Of Right Certificates; Mutilated, Destroyed, Lost Or Stolen
     Right Certificates...........................................................................................9

7.  Exercise Of Rights; Purchase Price; Expiration Date Of Rights................................................10

8.  Cancellation And Destruction Of Right Certificates...........................................................12

9.  Reservation And Availability Of Preferred Stock..............................................................13

10.  Preferred Stock Record Date.................................................................................14

11.  Adjustment Of Purchase Price, Number And Kind Of Shares Or Number Of Rights.................................14

12.  Certificate Of Adjusted Purchase Price Or Number Of Shares..................................................21

13.  Consolidation, Merger Or Sale Or Transfer Of Assets Or Earning Power........................................21

14.  Fractional Rights And Fractional Shares.....................................................................23

15.  Rights Of Action............................................................................................25

16.  Agreement Of Right Holders..................................................................................26

17.  Right Certificate Holder Not Deemed A Stockholder...........................................................26

18.  Concerning The Rights Agent.................................................................................26

19.  Merger Or Consolidation Or Change Of Name Of Rights Agent...................................................27

20.  Duties Of Rights Agent......................................................................................28

21.  Change Of Rights Agent......................................................................................30

22.  Issuance Of New Right Certificates..........................................................................31

23.  Redemption And Termination..................................................................................32

24.  Notice Of Certain Events....................................................................................33

25.  Miscellaneous...............................................................................................34

26.  Exchange....................................................................................................36

27.  Certain Beneficial Owners...................................................................................38

Exhibit A - Form of Certificate of Designation, Preferences and Rights
  of Series RP Preferred Stock..................................................................................A-1

Exhibit B - Form of Right Certificate...........................................................................B-1

Exhibit C - Form of Summary of Rights...........................................................................C-1

</TABLE>

<PAGE>

                                RIGHTS AGREEMENT

         This RIGHTS AGREEMENT (the  "Agreement") is made as of this 20th day of
December,  2000 by and between Washington Mutual, Inc., a Washington corporation
(the "Corporation"),  and Mellon Investor Services, L.L.C., a New Jersey limited
liability company (the "Rights Agent"),  with respect to the following facts and
circumstances.

         A.  The  Board  of  Directors  of the  Corporation  (the  "Board")  has
authorized  and declared a dividend of one  preferred  share  purchase  right (a
"Right")  for  each  share of  Common  Stock  (as  hereinafter  defined)  of the
Corporation,  outstanding at the Close of Business (as  hereinafter  defined) on
January  4, 2001 (the  "Record  Date"),  each  Right  representing  the right to
purchase  one  one-thousandth  (1/1000th)  of a share  of  Preferred  Stock  (as
hereinafter  defined),  upon the terms and subject to the conditions  herein set
forth.

         B. The Board of Directors of the Corporation has further authorized and
directed  the  issuance of one Right with  respect to each share of Common Stock
that shall  become  outstanding  between the Record Date and the earliest of the
Distribution  Date, the Redemption  Date or the Final  Expiration  Date (as such
terms are hereinafter  defined);  provided,  however,  that Rights may be issued
with respect to shares of Common Stock that shall become  outstanding  after the
Distribution  Date and prior to the earlier of the Redemption Date and the Final
Expiration  Date  in  accordance  with  the  provisions  of  Section  22 of this
Agreement.

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

     1. Certain Definitions.
        --------------------

     For  purposes of this  Agreement,  the  following  terms have the  meanings
indicated:

          1.1. "Acquiring Person" means, except as otherwise provided in Section
27, any Person who or which, together with all Affiliates and Associates of such
Person,  without the prior  approval of the  Corporation's  Board of  Directors,
shall be the Beneficial  Owner of shares  representing 15% or more of the Voting
Power  (other  than as a result of a Permitted  Offer) or was such a  Beneficial
Owner at any time after the date hereof, whether or not such person continues to
be the Beneficial Owner of shares  representing 15% or more of the Voting Power.
Notwithstanding the foregoing: (A) the term "Acquiring Person" shall not include
(i) the Corporation, (ii) any Subsidiary of the Corporation,  (iii) any employee
benefit plan of the  Corporation or of any Subsidiary of the  Corporation,  (iv)
any Person or entity  organized,  appointed or established by the Corporation or
any Subsidiary of the Corporation for or pursuant to the terms of any such plan,
or (v) any Person who or which,  together with all  Affiliates and Associates of
such Person,  becomes the Beneficial Owner of shares representing 15% or more of
the  Voting  Power as a result of the  acquisition  of  shares  of Common  Stock
directly  from the  Corporation;  and (B) no  Person  shall be  deemed  to be an

<PAGE>

"Acquiring  Person" either (i) as a result of the acquisition of Common Stock by
the  Corporation  which,  by  reducing  the  number of  shares  of Common  Stock
outstanding,  increases the proportional  number of shares beneficially owned by
such  Person  together  with  all  Affiliates  and  Associates  of such  Person;
provided,  however,  that if (X) a Person would become an Acquiring  Person (but
for the operation of this  subclause  (B)(i)) as a result of the  acquisition of
shares of Common Stock by the Corporation,  and (Y) after such share acquisition
by the  Corporation,  such Person,  or an Affiliate or Associate of such Person,
becomes the Beneficial Owner of any additional shares of Common Stock, then such
Person shall be deemed an Acquiring Person, or (ii) if (X) within eight (8) days
after such Person would  otherwise have become an Acquiring  Person (but for the
operation  of this  subclause  (B)(ii)),  such  Person  notifies  the  Board  of
Directors  of the  Corporation  that such  Person did so  inadvertently  and (Y)
within two (2)  Business  Days (as  defined in Section  1.8  hereof)  after such
notification,  such Person is the Beneficial Owner of shares  representing  less
than 15% of the Voting Power.

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

          1.3 "Adjusted Number of Shares" and "Adjusted Purchase Price" have the
respective meanings set forth in Section 11.1.3 hereof.

          1.4.  "Adjustment  Shares" has the meaning set forth in Section 11.1.2
hereof.

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

          1.6. The term  "current per share market price" shall have the meaning
set forth in Section  11.4.1  hereof when used with respect to a "Security"  (as
defined in said Section  11.4.1) and shall have the meaning set forth in Section
11.4.2 when used with respect to the Preferred Stock.

          1.7. A Person is the "Beneficial Owner" of and "beneficially owns" any
securities which:

               1.7.1.  such  Person  or  any  of  such  Person's  Affiliates  or
Associates beneficially owns, directly or indirectly;

               1.7.2.  such  Person  or  any  of  such  Person's  Affiliates  or
Associates  has (A) the right to  acquire  (whether  such  right is  exercisable
immediately  or only  after the  passage  of time)  pursuant  to any  agreement,
arrangement  or  understanding,  or upon  the  exercise  of  conversion  rights,
exchange  rights,  rights  (other than the  Rights),  warrants  or  options,  or
otherwise;  provided,  however, that a Person shall not be deemed the Beneficial
Owner of, or to beneficially  own,  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) the  right to vote  pursuant  to any  agreement,
arrangement  or  understanding;  provided,  however,  that a Person shall not be
deemed the  Beneficial  Owner of, or to  beneficially  own,  any security if the

                                       2
<PAGE>

agreement,  arrangement or understanding to vote such security (1) arises solely
from a revocable  proxy or consent  given to such Person in response to a public
proxy or consent  solicitation  made  pursuant to, and in accordance  with,  the
applicable rules and regulations  promulgated  under the Exchange Act and (2) is
not also  then  reportable  on  Schedule  13D  under  the  Exchange  Act (or any
comparable or successor report); or

               1.7.3. 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 relating to the acquisition, holding, voting (except to the extent
contemplated by the proviso to subclause (B) of Section 1.7.2),  or disposing of
any securities of the Corporation.

               Notwithstanding anything in this Section 1.7 to the contrary, the
phrase "then  outstanding,"  when used with  reference to a Person's  Beneficial
Ownership  of  securities  of the  Corporation,  shall  mean the  number of such
securities  then  issued  and  outstanding  together  with  the  number  of such
securities not then actually issued and  outstanding  which such Person would be
deemed to own beneficially hereunder.

               Notwithstanding  anything in this Section 1.7 to the contrary, no
Person shall be deemed to  beneficially  own any securities  solely by reason of
such Person being a party to a customary agreement pursuant to which such Person
acts or agrees  to act as an  underwriter  with  respect  to a bona fide  public
offering of securities.

               No decision  reached,  or action taken, by the Board of Directors
of the  Corporation  or any  committee  thereof  shall  cause any Person (or any
Affiliate or Associate of such Person) who is a member of the Board of Directors
of the  Corporation  or such  committee  to be deemed,  for the purposes of this
Agreement,  to be a Beneficial Owner of any securities beneficially owned by any
other  Person (or any  Affiliate or Associate of such Person) who is a member of
the Board of Directors of the  Corporation  or any committee  thereof  solely by
reason of such membership of the Board of Directors or any committee  thereof or
participation  in the decisions or actions thereof on the part of either or both
of such Persons.

          1.8.  "Business Day" means any day other than a Saturday,  a Sunday, a
day on which banking  institutions  in the State of Washington,  New York or New
Jersey are  obligated by law or  executive  order to close,  or a United  States
federal holiday.

          1.9. "Capital Stock  Equivalents" has the meaning set forth in Section
11.1.3 hereof.

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

          1.11. "Common Stock" when used with reference to the Corporation means
the  Common  Stock  of the  Corporation  or,  in  the  event  of a  subdivision,
combination or  consolidation  with respect to such shares of Common Stock,  the
shares  of  Common  Stock  resulting  from  such  subdivision,   combination  or

                                       3
<PAGE>

consolidation.  "Common Stock" when used with reference to any Person other than
the Corporation  means the capital stock (or equity  interest) with the greatest
voting power of such other  Person or, if such other  Person is a Subsidiary  of
another   Person,   the  Person  or  Persons  which   ultimately   control  such
first-mentioned Person.

          1.12.  "Corporation"  means  Washington  Mutual,  Inc.,  a  Washington
corporation,  and also means a Principal Party to the extent provided in Section
13.1 hereof.

          1.13.  "Distribution  Date" has the  meaning  set forth in Section 3.1
hereof.

          1.14.  "Equivalent  Preferred  Stock"  has the  meaning  set  forth in
Section 11.2 hereof.

          1.15.  "Exchange  Act" means the  Securities  Exchange Act of 1934, as
amended.

          1.16.  "Exchange  Ratio" has the  meaning  set forth in  Section  26.1
hereof.

          1.17. "Final Expiration Date" has the meaning set forth in Section 7.1
hereof.

          1.18.  "Interested  Stockholder"  means  any  Acquiring  Person or any
Affiliate or  Associate of an Acquiring  Person or any other Person in which any
such  Acquiring  Person,  Affiliate or Associate  has an interest,  or any other
Person  acting  directly or  indirectly on behalf of or in concert with any such
Acquiring Person, Affiliate or Associate.

          1.19. "NASDAQ" has the meaning set forth in Section 11.4.1 hereof.

          1.20.  "Permitted Offer" means a tender or exchange offer which is for
all  outstanding  shares of Common  Stock of the  Corporation  at a price and on
terms determined,  prior to the purchase of shares under such tender or exchange
offer,  by at least a majority of the members of the Board of Directors  who are
not officers of the Corporation and who are not Acquiring Persons or Affiliates,
Associates,  nominees or  representatives of an Acquiring Person, to be adequate
(taking into account all factors that such directors  deem pertinent  including,
without limitation,  prices that could reasonably be achieved if the Corporation
or its assets were sold on an orderly basis  designed to realize  maximum value)
and otherwise in the best interests of the Corporation,  its stockholders (other
than the Person or any  Affiliate or Associate  thereof on whose basis the offer
is being  made) and other  relevant  constituencies,  taking  into  account  all
factors that such directors may deem pertinent.

          1.21. "Person" means any individual,  firm, partnership,  corporation,
limited liability company,  limited liability partnership,  trust,  association,
joint  venture  or other  entity,  and  includes  any  successor  (by  merger or
otherwise) of such entity.

          1.22.  "Preferred Stock" means shares of the  Corporation's  Series RP
Preferred  Stock,  par  value  $.01  per  share,  having  the  relative  rights,
preferences and limitations set forth in the Form of Certificate of Designation,
Preferences  and Rights of Series RP Preferred  Stock attached to this Agreement
as Exhibit A.

                                       4
<PAGE>

          1.23.  "Principal  Party" has the  meaning  set forth in Section  13.2
hereof.

          1.24.  "Proration  Factor" has the meaning set forth in Section 11.1.3
hereof.

          1.25.  "Purchase  Price"  has the  meaning  set forth in  Section  4.1
hereof.

          1.26. "Record Date" has the meaning set forth in Recital A hereof.

          1.27.  "Redemption  Date" has the  meaning  set forth in  Section  7.1
hereof.

          1.28.  "Redemption  Price" has the meaning set forth in Section 23.1.1
hereof.

          1.29.  "Right  Certificate"  has the  meaning set forth in Section 3.1
hereof.

          1.30. "Rights" has the meaning set forth in Recital A hereof.

          1.31. "Rights Agent" means Mellon Investor Services, L.L.C., as Rights
Agent  hereunder,  and, from the time of its  succession,  any successor  Rights
Agent under Section 19 or Section 21 hereof.

          1.32.  "Section  11.1.2  Event" has the  meaning  set forth in Section
11.1.2 hereof.

          1.33.  "Section 13 Event" means any event described in clause (x), (y)
or (z) of Section 13.1 hereof.

          1.34.  "Shares  Acquisition  Date"  means  the  first  date of  public
announcement  (which,  for purposes of this definition,  shall include,  without
limitation,  a report filed pursuant to the Exchange Act) by the  Corporation or
an Acquiring Person that an Acquiring Person has become such or that facts exist
as a result of which there exists an Acquiring Person;  provided,  that, if such
Person is  determined by the Board of Directors of the  Corporation  not to have
become an Acquiring Person pursuant to subclause  (B)(ii) of Section 1.1 hereof,
then no Shares Acquisition Date shall be deemed to have occurred.

          1.35. "Subsidiary" of any Person means any corporation or other Person
of which a majority  of the  voting  power of the voting  equity  securities  or
equity interest is owned, directly or indirectly, by such Person.

          1.36.  "Summary  of Rights"  has the  meaning set forth in Section 3.2
hereof.

          1.37.  "Trading  Day" has the  meaning  set  forth in  Section  11.4.1
hereof.

          1.38. "Triggering Event" means any Section 11.1.2 Event or any Section
13 Event.

          1.39.  "Voting  Power" means the  combined  voting power of the voting
securities of the Corporation,  outstanding on any relevant  determination date,
to vote generally in the election of directors of the Corporation.

                                       5
<PAGE>

          1.40.  The term  "voting  securities"  has the  meaning  set  forth in
Section 13.1 hereof.

     2. Appointment of Rights Agent.

          2.1. The Corporation  hereby appoints the Rights Agent to act as agent
for the Corporation in accordance with the terms and conditions  hereof, and the
Rights Agent hereby accepts such  appointment.  The Corporation 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.

     3. Issuance of Right Certificates.

          3.1. Until the earlier of (i) the Shares  Acquisition Date or (ii) the
Close  of  Business  on the  tenth  (10th)  day (or  such  later  date as may be
determined by action of the Corporation's  Board of Directors) after the date of
the  commencement by any Person (other than the  Corporation,  any Subsidiary of
the  Corporation,  any  employee  benefit  plan  of  the  Corporation  or of any
Subsidiary of the  Corporation or any Person or entity  organized,  appointed or
established  by the  Corporation  or any  Subsidiary of the  Corporation  for or
pursuant  to the  terms of any such  plan)  of,  or after  the date of the first
public  announcement of the intention of any Person (other than the Corporation,
any Subsidiary of the Corporation,  any employee benefit plan of the Corporation
or of any  Subsidiary  of the  Corporation  or any  Person or entity  organized,
appointed or established by the Corporation or any Subsidiary of the Corporation
for or pursuant to the terms of any such plan) to commence  (which  intention to
commence remains in effect for five (5) Business Days after such  announcement),
a tender or exchange offer the  consummation of which would result in any Person
becoming an Acquiring Person  (including,  in the case of both (i) and (ii), any
such date which is after the date of this Agreement and prior to the issuance of
the Rights) (the "Distribution Date"), (x) the Rights will be evidenced (subject
to the  provisions  of Section  3.2  hereof) by the  certificates  for shares of
Common Stock registered in the names of the holders thereof (which  certificates
shall  also be  deemed  to be  Right  Certificates)  and not by  separate  Right
Certificates,   and  (y)  the  right  to  receive  Right  Certificates  will  be
transferable  only in connection  with the transfer of the underlying  shares of
Common Stock (including a transfer to the Corporation);  provided, however, that
if a tender  or  exchange  offer is  terminated  prior  to the  occurrence  of a
Distribution  Date,  then no  Distribution  Date shall occur as a result of such
tender or exchange offer. As soon as practicable  after the  Distribution  Date,
the Corporation will prepare and execute, the Rights Agent will countersign, and
the Corporation  will send or cause to be sent by  first-class,  postage-prepaid
mail,  to each  record  holder  of  shares  of  Common  Stock as of the Close of
Business on the  Distribution  Date,  at the address of such holder shown on the
records of the Corporation,  a Right  Certificate,  substantially in the form of
Exhibit B hereto (a "Right Certificate"), evidencing one Right for each share of
Common Stock so held. As of and after the Distribution  Date, the Rights will be
evidenced solely by such Right Certificates.

         The Corporation  shall promptly notify the Rights Agent in writing upon
the  occurrence  of the  Distribution  Date and, if such  notification  is given
orally,  the  Corporation  shall  confirm the same in writing on or prior to the
Business Day next following.  Until such notice is received by the Rights Agent,
the Rights Agent may presume conclusively for all purposes that the Distribution
Date has not occurred.

                                       6
<PAGE>

         3.2.  As  promptly  as  practicable  following  the Record  Date,  the
Corporation will send a copy of a Summary of Rights to Purchase Preferred Stock,
in  substantially  the form of Exhibit C hereto (the  "Summary of  Rights"),  by
first-class,  postage-prepaid  mail,  to each record  holder of shares of Common
Stock as of the Close of  Business  on the Record  Date,  at the address of such
holder shown on the records of the Corporation. With respect to certificates for
shares of Common Stock outstanding as of the Record Date, until the Distribution
Date the Rights will be evidenced by such  certificates  registered in the names
of the holders  thereof  together with a copy of the Summary of Rights  attached
thereto.  Until the Distribution  Date (or the earlier of the Redemption Date or
the Final  Expiration  Date),  the surrender for transfer of any certificate for
shares of Common Stock outstanding on the Record Date, with or without a copy of
the Summary of Rights  attached  thereto,  shall also constitute the transfer of
the Rights associated with such shares of Common Stock.

          3.3.  Certificates for shares of Common Stock that become  outstanding
(including, without limitation, reacquired shares of Common Stock referred to in
the last  sentence of this  Section  3.3) after the Record Date but prior to the
earliest of the  Distribution  Date, the Redemption Date or the Final Expiration
Date,  shall be deemed also 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 a Rights  Agreement  between
                  Washington Mutual, Inc. and Mellon Investor Services,  L.L.C.,
                  as Rights  Agent,  dated as of December  20, 2000 (the "Rights
                  Agreement"), the terms of which are hereby incorporated herein
                  by reference  and a copy of which is on file at the  principal
                  executive  offices of Washington  Mutual,  Inc.  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.  Washington  Mutual,
                  Inc. will mail to the holder of this certificate a copy of the
                  Rights  Agreement  without  charge after  receipt of a written
                  request therefor. Under certain circumstances set forth in the
                  Rights Agreement, Rights issued to, or held by, any Person who
                  is, was or  becomes an  Acquiring  Person or an  Affiliate  or
                  Associate  thereof  (as defined in the Rights  Agreement)  and
                  certain  related  persons,  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
Distribution  Date  the  Rights  associated  with the  shares  of  Common  Stock
represented by such certificates shall be evidenced by such certificates  alone,
and the surrender for transfer of any such certificate shall also constitute the
transfer of the Rights  associated  with the shares of Common Stock  represented

                                       7
<PAGE>

thereby.  In the event that the Corporation  purchases or acquires any shares of
Common  Stock after the Record Date but prior to the  Distribution  Date (or the
earlier  of the  Redemption  Date or the  Final  Expiration  Date),  any  Rights
associated with such shares of Common Stock shall be deemed canceled and retired
so that the Corporation  shall not be entitled to exercise any Rights associated
with the Common Stock that are no longer outstanding.

     4. Form of Right Certificate.

          4.1. The Right Certificates (and the forms of election to purchase and
of assignment to be printed on the reverse  thereof) shall 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  Corporation  may deem  appropriate  (which  may not  affect  the duties and
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 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 Right Certificates shall entitle the holders thereof
to  purchase  such  number  of one  one-thousandths  (1/1000ths)  of a share  of
Preferred   Stock  as  shall  be  set  forth   therein  at  the  price  per  one
one-thousandth  (1/1000th)  of a share of Preferred  Stock set forth  therein in
accordance  with Section 7.2 hereof (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.

          4.2. Any Right  Certificate  issued pursuant to Section 3.1 or Section
22 hereof that represents  Rights that are null and void pursuant to Section 7.6
of this  Agreement  and any Right  Certificate  issued  pursuant to Section 6 or
Section 11 hereof upon  transfer,  exchange,  replacement  or  adjustment of any
other Right  Certificate  referred to in this  sentence,  shall  contain (to the
extent feasible and upon notice by the Corporation to the Rights Agent that this
Section 4.2 has become applicable) the following legend:

                  The Rights  represented by this Right  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 Right Certificate and the Rights  represented  hereby are
                  null and void.

The  provisions of Section 7.6 of this Agreement  shall be operative  whether or
not the foregoing legend is contained on any such Right Certificate.

     5. Countersignature and Registration.

          5.1.  The  Right  Certificates  shall be  executed  on  behalf  of the
Corporation  by its President or any Executive  Vice President and the Secretary
or an Assistant Secretary, either manually or by facsimile signature, shall have
affixed  thereto the  Corporation's  seal or a facsimile  thereof,  and shall be
attested by the Secretary or an Assistant  Secretary of the Corporation,  either

                                       8
<PAGE>

manually  or  by  facsimile   signature.   The  Right   Certificates   shall  be
countersigned,  either manually or by facsimile  signature,  by the Rights Agent
and shall  not be valid for any  purpose  unless so  countersigned.  In case any
officer of the Corporation  who shall have signed any of the Right  Certificates
shall cease to be such officer of the Corporation before countersignature by the
Rights  Agent  and  issuance  and  delivery  by  the  Corporation,   such  Right
Certificates  may  nevertheless be  countersigned by the Rights Agent and issued
and  delivered by the  Corporation  with the same force and effect as though the
person who signed such Right  Certificates  had not ceased to be such officer of
the  Corporation;  and any  Right  Certificate  may be  signed  on behalf of the
Corporation by any Person who, at the actual date of the execution of such Right
Certificate,  shall be a proper  officer of the  Corporation  to sign such Right
Certificate,  although at the date of the execution of this Rights Agreement any
such Person was not such an officer.

          5.2.  Following the Distribution Date, and receipt by the Rights Agent
of a list of record holders of Rights, the Rights Agent will keep or cause to be
kept, at its office designated  pursuant to Section 25 hereof as the appropriate
place  for  surrender  or  transfer  of  the  Right   Certificates,   books  for
registration and transfer of the Right Certificates issued hereunder. Such books
shall  show the names  and  addresses  of the  respective  holders  of the Right
Certificates,  the number of Rights  evidenced  on the face of each of the Right
Certificates  and  the  certificate  number  and the  date of each of the  Right
Certificates.

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

          6.1. Subject to the provisions of Section 4.2, Section 7.6 and Section
14 hereof, at any time after the Close of Business on the Distribution Date, and
at or prior to the Close of Business on the  earlier of the  Redemption  Date or
the Final  Expiration Date, any Right  Certificate or Right  Certificates may be
transferred,  split up,  combined or exchanged for another Right  Certificate or
Right Certificates, entitling the registered holder to purchase a like number of
one  one-thousandths  (1/1000ths) of a share of Preferred Stock (or, following a
Triggering Event, other securities, as the case may be) as the Right Certificate
or Right Certificates surrendered then entitled such holder (or former holder in
the case of a transfer) to purchase. Any registered holder desiring to transfer,
split up, combine or exchange any Right Certificate or Right  Certificates shall
make such request in writing  delivered to the Rights Agent, and shall surrender
the  Right  Certificate  or Right  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 Corporation shall be obligated to take
any action whatsoever with respect to the transfer of any such surrendered Right
Certificate until the registered holder shall have properly completed and signed
the certificate  contained in the form of assignment on the reverse side of such
Right  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  Corporation  or the Rights  Agent  shall  reasonably
request.  Thereupon the Rights Agent shall,  subject to Section 4.2, Section 7.6
and Section 14 hereof,  countersign and deliver to the Person entitled thereto a
Right  Certificate or Right  Certificates,  as the case may be, as so requested.
The  Corporation  may require  payment of a sum  sufficient  to cover any tax or
charge  that  may  be  imposed  in  connection  with  any  transfer,  split  up,

                                       9
<PAGE>

combination or exchange of Right Certificates.  The Rights Agent may in its sole
discretion  require  the  Corporation  or the  Person  entitled  to  such  Right
Certificate  to  provide  evidence  that such  payment  has been  made  prior to
countersigning  and  delivering any Right  Certificate  pursuant to this Section
6.1. The Rights Agent shall have no duty or obligation under this Section unless
and until it satisfied that all such taxes and/or charges have been paid.

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

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

          7.1. Subject to Section 7.6 hereof, the registered holder of any Right
Certificate  may  exercise  the Rights  evidenced  thereby  (except as otherwise
provided  herein)  in whole or in part at any time after the  Distribution  Date
upon surrender of the Right  Certificate,  with the form of election to purchase
and the  certificate  on the reverse side thereof duly  executed,  to the Rights
Agent at the office of the Rights Agent  designated  for such purpose,  together
with  payment  of the  aggregate  Purchase  Price  for the  total  number of one
one-thousandths  (1/1000ths) of a share of Preferred Stock (or other securities,
as the case may be) as to which such  surrendered  Rights are  exercised,  at or
prior to the earlier of (i) the Close of Business on January 4, 2011 (the "Final
Expiration Date"), or (ii) the time at which the Rights are redeemed as provided
in Section 23 hereof (the "Redemption Date").

          7.2. The Purchase  Price for each one  one-thousandth  (1/1000th) of a
share of Preferred  Stock pursuant to the exercise of a Right shall initially be
$200.00,  shall be subject to  adjustment  from time to time as  provided in the
next  sentence  and in  Sections  11 and 13.1  hereof  and shall be  payable  in
accordance with paragraph 7.3 below.  Anything in this Agreement to the contrary
notwithstanding,  in the event that at any time after the date of this Agreement
and prior to the Distribution Date, the Corporation shall (i) declare or pay any
dividend  on the  Common  Stock  payable  in  Common  Stock  or  (ii)  effect  a
subdivision,   combination   or   consolidation   of  the   Common   Stock   (by
reclassification  or otherwise  than by payment of dividends in shares of Common
Stock) into a greater or lesser number of shares of Common  Stock,  then, in any
such case, each share of Common Stock  outstanding  following such  subdivision,
combination or consolidation shall continue to have a Right associated therewith
and the  Purchase  Price  following  any such  event  shall  be  proportionately
adjusted  to equal  the  result  obtained  by  multiplying  the  Purchase  Price
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 shall be the total number
of shares of Common Stock  outstanding  immediately  following the occurrence of
such event. The adjustment  provided for in the preceding sentence shall be made
successively whenever such a dividend is declared or paid or such a subdivision,
combination or consolidation is effected.

                                     10
<PAGE>
          7.3.  Upon  receipt of a Right  Certificate  representing  exercisable
Rights, with the form of election to purchase and the certificate on the reverse
side thereof duly executed, accompanied by payment of the Purchase Price for the
Preferred Stock (or other securities, as the case may be) to be purchased and an
amount equal to any applicable  tax or charge  required to be paid by the holder
of such Right  Certificate  in  accordance  with  Section 6 hereof by  certified
check,  cashier's check or money order payable to the order of the  Corporation,
the Rights Agent shall thereupon  promptly (i) (A) requisition from any transfer
agent of the Preferred Stock  certificates for the number of shares of Preferred
Stock to be purchased,  and the Corporation  hereby  irrevocably  authorizes its
transfer agent to comply with all such requests,  or (B) if the Corporation,  in
its sole discretion,  shall have elected to deposit the Preferred Stock issuable
upon exercise of the Rights  hereunder into a depositary,  requisition  from the
depositary  agent   depositary   receipts   representing   such  number  of  one
one-thousandths (1/1000ths) of a share of Preferred Stock as are to be purchased
(in which case certificates for the Preferred Stock represented by such receipts
shall be  deposited  by the transfer  agent with the  depositary  agent) and the
Corporation will direct the depositary agent to comply with such requests,  (ii)
when appropriate, requisition from the Corporation the amount of cash to be paid
in lieu of issuance of fractional  shares in accordance  with Section 14 hereof,
(iii) after receipt of such certificates or depositary receipts,  cause the same
to be  delivered  to or upon the order of the  registered  holder of such  Right
Certificate,  registered  in such  name or  names as may be  designated  by such
holder, and (iv) when appropriate,  after receipt thereof,  deliver such cash to
or upon the order of the  registered  holder of such Right  Certificate.  In the
event that the  Corporation  is obligated to issue other  securities  (including
shares of Common Stock) of the Corporation  pursuant to Section 11.1 hereof, the
Corporation will make all  arrangements  necessary so that such other securities
are available for  distribution  by the Rights Agent,  if and when  necessary to
comply with this Agreement.

          7.4. In addition, in the case of an exercise of the Rights by a holder
pursuant to Section 11.1.2, the Rights Agent shall return such Right Certificate
to the  registered  holder  thereof  after  imprinting,  stamping  or  otherwise
indicating  thereon that the Rights  represented  by such Right  Certificate  no
longer include the rights provided by Section 11.1.2 of the Rights Agreement and
if less  than all the  Rights  represented  by such  Right  Certificate  were so
exercised,  the Rights Agent shall indicate on the Right  Certificate the number
of Rights  represented  thereby that continue to include the rights  provided by
Section 11.1.2.

          7.5.  In case the  registered  holder of any Right  Certificate  shall
exercise less than all the Rights  evidenced  thereby,  a new Right  Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Rights Agent to the registered holder of such Right Certificate or to his
duly authorized  assigns,  subject to the provisions of Section 6 and Section 14
hereof,  or the Rights  Agent shall place an  appropriate  notation on the Right
Certificate with respect to those Rights exercised.

                                       11
<PAGE>

          7.6.  Notwithstanding anything in this Agreement to the contrary, from
and  after  the  first   occurrence  of  a  Section  11.1.2  Event,  any  Rights
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of an
Acquiring Person,  (ii) a transferee of an Acquiring Person (or of any Affiliate
or  Associate  thereof)  who becomes a  transferee  after the  Acquiring  Person
becomes such, or (iii) a transferee of an Acquiring  Person (or of any Affiliate
or Associate thereof) 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 from
any  Affiliate  or  Associate  thereof) to holders of equity  interests  in such
Acquiring  Person  or to  any  Person  with  whom  the  Acquiring  Person  has a
continuing  agreement,  arrangement or  understanding  regarding the transferred
Rights or (B) a transfer  that the Board of  Directors  of the  Corporation  has
determined is part of a plan, arrangement or understanding that has as a primary
purpose or effect the avoidance of this Section 7.6,  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 Corporation shall notify the Rights Agent when this
Section  7.6  applies  and shall use all  reasonable  efforts to insure that the
provisions  of this  Section 7.6 and Section 4.2 hereof are complied  with,  but
neither the  Corporation  nor the Rights  Agent shall have any  liability to any
holder of Right  Certificates  or other Person as a result of the  Corporation's
failure to make any  determinations  with respect to an Acquiring  Person or its
Affiliates, Associates or transferees hereunder.

          7.7.  Notwithstanding  anything  in this  Agreement  to the  contrary,
neither the Rights Agent nor the Corporation shall be obligated to undertake any
action with respect to a registered  holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i)  properly  completed  and signed the  certificate  contained  in the form of
election to  purchase  set forth on the  reverse  side of the Right  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  Corporation  or the Rights  Agent  shall  reasonably
request.

     8. Cancellation and Destruction of Right Certificates.

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

                                       12
<PAGE>

     9. Reservation and Availability of Preferred Stock.

          9.1. The Corporation  covenants and agrees that, at all times prior to
the occurrence of a Section 11.1.2 Event,  it will cause to be reserved and kept
available out of its authorized and unissued  Preferred Stock, or any authorized
and  issued  Preferred  Stock  held in its  treasury,  the  number  of shares of
Preferred  Stock that will be  sufficient  to permit the exercise in full of all
outstanding  Rights and, after the occurrence of a Section 11.1.2 Event,  shall,
to the extent reasonably practicable, so reserve and keep available a sufficient
number of shares of Common Stock (and/or other  securities) that may be required
to permit the exercise in full of the Rights pursuant to this Agreement.

          9.2.  So long  as the  shares  of  Preferred  Stock  (and,  after  the
occurrence  of a Section  11.1.2  Event,  shares  of  Common  Stock or any other
securities)  issuable upon the exercise of the Rights may be listed on any stock
exchange,  the Corporation  shall use its best efforts to cause,  from and after
such time as the  Rights  become  exercisable,  all  shares or other  securities
reserved for such issuance to be listed on such exchange upon official notice of
issuance upon such exercise.

          9.3. The  Corporation  covenants and agrees that it will take all such
action as may be  necessary  to ensure  that all shares of  Preferred  Stock (or
shares of Common Stock and/or other  securities,  as the case may be)  delivered
upon exercise of Rights shall, at the time of delivery of the  certificates  for
such shares or other securities  (subject to payment of the Purchase Price),  be
duly and validly authorized and issued and fully paid and non-assessable  shares
or securities.

          9.4. The  Corporation  covenants  and agrees that it will pay when due
and payable any and all taxes and charges  that may be payable in respect of the
issuance  or delivery of the Right  Certificates  or of any shares of  Preferred
Stock (or shares of Common Stock and/or  other  securities,  as the case may be)
upon the exercise of Rights. The Corporation shall not, however,  be required to
pay any tax or charge that may be payable in respect of any transfer or delivery
of Right  Certificates  to a person  other than,  or the issuance or delivery of
certificates or depositary receipts for the shares of Preferred Stock (or shares
of Common  Stock and/or  other  securities,  as the case may be) in a name other
than that of, the registered holder of the Right  Certificate  evidencing Rights
surrendered  for  exercise,  or to  issue  or to  deliver  any  certificates  or
depositary  receipts  for shares of  Preferred  Stock (or shares of Common Stock
and/or  other  securities,  as the case may be) upon the exercise of any Rights,
until any such tax or governmental  charge shall have been paid (any such tax or
charge  being  payable by the holder of such  Right  Certificate  at the time of
surrender) or until it has been  established to the  Corporation's or the Rights
Agent's reasonable satisfaction that no such tax or charge is due.

          9.5. The  Corporation  shall use its best efforts to (i) file, as soon
as practicable  following the Shares Acquisition Date, a registration  statement
under the Act, with respect to the securities  purchasable  upon exercise of the
Rights on an appropriate form, (ii) cause such registration  statement to become
effective  as soon as  practicable  after  such  filing,  and (iii)  cause  such
registration  statement  to remain  effective  (with a  prospectus  at all times

                                       13
<PAGE>

meeting the  requirements of the Act and the rules and  regulations  thereunder)
until the date of the  expiration  of the  period  for  exercise  of the  Rights
provided by Section 11.1.2. The Corporation will also take such action as may be
appropriate under the blue sky laws of the various states.

     10. Preferred Stock Record Date.

     Each Person in whose name any certificate for shares of Preferred Stock (or
shares of Common Stock and/or  other  securities,  as the case may be) is issued
upon the  exercise of Rights shall for all purposes be deemed to have become the
holder of record of the shares of  Preferred  Stock (or  shares of 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 Right Certificate evidencing
such  Rights was duly  surrendered  and payment of the  Purchase  Price (and any
applicable taxes and governmental charges) was made; provided, however, that, if
the date of such  surrender  and  payment  is a date upon  which  the  shares of
Preferred Stock (or shares of Common Stock and/or other securities,  as the case
may be)  transfer  books of the  Corporation  are closed,  such person  shall be
deemed to have become the record holder of such shares on, and such  certificate
shall be  dated,  the  next  succeeding  Business  Day on which  the  shares  of
Preferred Stock (or shares of Common Stock and/or other securities,  as the case
may be) transfer books of the Corporation are open.

     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.

          11.1. Adjustment Events.

               11.1.1.  In the event the Corporation shall at any time after the
date of this Agreement (A) declare a dividend on the Preferred  Stock payable in
Preferred Stock, (B) subdivide the outstanding  Preferred Stock, (C) combine the
outstanding  Preferred  Stock into a smaller  number of  Preferred  Stock 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  Corporation  is the  continuing or surviving  corporation),
except as otherwise  provided in this  Section 11.1 and Section 7.6 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 capital  stock  issuable  on such  date,  shall be
proportionately  adjusted so that the holder of any Right  exercised  after such
time shall be  entitled to receive  the  aggregate  number and kind of shares of
capital stock that, if such Right had been exercised  immediately  prior to such
date and at a time when the Preferred  Stock transfer  books of the  Corporation
were open,  such holder 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 Right be less than the aggregate par value,  if
any, of the shares of capital stock of the Corporation issuable upon exercise of
one Right.  If an event  occurs  that would  require  an  adjustment  under both

                                       14
<PAGE>

Section 11.1.1 and Section 11.1.2,  the adjustment  provided for in this Section
11.1.1  shall be in  addition  to, and shall be made  prior to,  any  adjustment
required pursuant to Section 11.1.2.

               11.1.2.  In the event (a "Section 11.1.2 Event") that any Person,
alone or together with its Affiliates and Associates,  shall become an Acquiring
Person,  then  proper  provision  shall be made so that  each  holder of a Right
(except as  provided  below and in Section 7.6  hereof)  shall,  for a period of
sixty (60) days (or such longer period as the  Corporation's  Board of Directors
may  determine  at any time prior to or during  such  period of sixty (60) days)
after the later of the  occurrence of any such event or the effective date of an
appropriate registration statement under the Act pursuant to Section 9.5 hereof,
have a right to receive,  upon exercise  thereof in accordance with the terms of
this  Agreement,  at a total  price  equal to the then  current  Purchase  Price
multiplied by the number of one  one-thousandths  of a share of Preferred  Stock
for which a Right is then  exercisable,  such  number of shares of Common  Stock
(or,  in  the  discretion  of  the   Corporation's   Board  of  Directors,   one
one-thousandths  (1/1000ths)  of a share of Preferred  Stock) as shall equal the
result obtained by (x)  multiplying the then current  Purchase Price by the then
number of one  one-thousandths  (1/1000ths)  of a share of  Preferred  Stock for
which a Right was  exercisable  immediately  prior to the first  occurrence of a
Section  11.1.2 Event,  and (y) dividing that product by 50% of the then current
per share market price of the Common Stock (determined  pursuant to Section 11.4
hereof)  on the date of such  first  occurrence  (such  number of  shares  being
referred  to 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 11.1.2.

               11.1.3. In the event that there shall not be sufficient  treasury
or authorized but unissued (and unreserved)  Common Stock to permit the exercise
in full of the Rights in accordance with Section 11.1.2 and the Rights become so
exercisable (and the Board of Directors of the Corporation has not determined to
make the  Rights  exercisable  solely  into  fractions  of a share of  Preferred
Stock),  notwithstanding  any other provision of this  Agreement,  to the extent
necessary and permitted by applicable  law, each Right (except as provided below
and in Section 7.6 hereof) shall thereafter represent the right to receive, upon
exercise thereof at the then current Purchase Price in accordance with the terms
of this  Agreement,  (x) a number of (or  fractions  of) shares of Common  Stock
calculated  by dividing  the maximum  number of shares of Common  Stock that may
permissibly  be issued by the number of  outstanding  Rights and (y) a number of
one one-thousandths  (1/1000ths) of shares of Preferred Stock or a number of, or
fractions of, other equity  securities of the Corporation (or, in the discretion
of the Board of Directors of the Corporation,  debt) that the Board of Directors
of the  Corporation  has  determined to have an aggregate  current  market value
(determined  pursuant to Section 11.1.1 and Section 11.1.2 hereof, to the extent
applicable)  equal to the  difference  between (1) the aggregate  current market
value of the  Adjustment  Shares  (assuming such shares of Common Stock could be
issued  pursuant to Section 11.1.2 hereof) and (2) the aggregate  current market
value of the shares of Common Stock issued in respect of such Right  pursuant to
the  preceding  clause (x) (such number of, or fractions of, shares of Preferred
Stock, debt or other equity securities or debt of the Corporation being referred
to as a "Capital Stock Equivalent");  provided, however, if sufficient shares of
Common  Stock  and/or  Capital  Stock  Equivalents  are  unavailable,  then  the

                                       15
<PAGE>

Corporation  shall,  to the extent  permitted by  applicable  law, take all such
action as may be  necessary to  authorize  additional  shares of Common Stock or
Capital Stock  Equivalents  for issuance upon exercise of the Rights,  including
the calling of a meeting of  stockholders;  and provided,  further,  that if the
Corporation is unable to cause sufficient  shares of Common Stock and/or Capital
Stock  Equivalents  to be available  for issuance  upon  exercise in full of the
Rights,  then each Right  shall  thereafter  represent  the right to receive the
Adjusted Number of Shares upon exercise at the Adjusted  Purchase Price (as such
terms are hereinafter  defined).  As used herein,  the term "Adjusted  Number of
Shares"  shall be equal to that  number of (or  fractions  of)  shares of Common
Stock (and/or Capital Stock  Equivalents) equal to the product of (x) the number
of Adjustment Shares and (y) a fraction, the numerator of which is the number of
shares of Common Stock (and/or Capital Stock Equivalents) available for issuance
upon exercise of the Rights and the denominator of which is the aggregate number
of  Adjustment  Shares  otherwise  issuable  upon exercise in full of all Rights
(assuming  there were a sufficient  number of shares of Common Stock  available)
(such  fraction  being  referred to as the  "Proration  Factor").  The "Adjusted
Purchase  Price" shall mean the product of the Purchase  Price and the Proration
Factor. The Board of Directors of the Corporation may, but shall not be required
to, establish procedures to allocate the right to receive shares of Common Stock
and Capital  Stock  Equivalents  upon  exercise of the Rights  among  holders of
Rights.

          11.2. In case the Corporation shall fix a record date for the issuance
of rights  (other  than the  Rights),  options  or  warrants  to all  holders of
Preferred  Stock  entitling them (for a period  expiring within 60 calendar days
after such record date) to subscribe for or purchase  shares of Preferred  Stock
(or shares having the same rights,  privileges and  preferences as the Preferred
Stock ("Equivalent  Preferred Stock")) or securities  convertible into Preferred
Stock or Equivalent  Preferred  Stock at a price per share of Preferred Stock or
Equivalent  Preferred  Stock  (or  having a  conversion  price per  share,  if a
security  convertible  into shares of Preferred  Stock or  Equivalent  Preferred
Stock) less than the then current per share market price of the Preferred  Stock
(as  determined  pursuant  to Section  11.4  hereof) 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  per  share  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  Right  be less  than the
aggregate par value,  if any, of the shares of capital stock of the  Corporation
issuable upon exercise of one Right. In case such subscription price may be paid
in a consideration  part or all of which shall be in a form other than cash, the
value of such  consideration  shall be  determined in good faith by the Board of
Directors  of the  Corporation,  whose  determination  shall be  described  in a
statement  filed with the Rights  Agent and shall be binding on the Rights Agent
and the holders of the Rights.  Preferred Stock owned by or held for the account
of the Corporation  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 that would
then be in effect if such record date had not been fixed.

                                       16
<PAGE>

          11.3. In case the  Corporation  shall fix a record date for the making
of a  distribution  to all holders of the Preferred  Stock  (including  any such
distribution  made in  connection  with a  consolidation  or merger in which the
Corporation  is  the  continuing  or  surviving  corporation)  of  evidences  of
indebtedness  or assets  (other  than a regular  quarterly  cash  dividend  or a
dividend  payable  in  Preferred  Stock)  or  subscription  rights  or  warrants
(excluding  those referred to in Section 11.2 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 then  current  per  share  market  price  (as
determined  pursuant  to Section  11.4  hereof) of the  Preferred  Stock on such
record  date,  less the fair market  value (as  determined  in good faith by the
Board of Directors of the Corporation, 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) of the  portion of the assets or  evidences  of
indebtedness  so to be  distributed or of such  subscription  rights or warrants
applicable to one share of Preferred  Stock,  and the denominator of which shall
be such  current  per  share  market  price of the  Preferred  Stock;  provided,
however,  that in no event shall the  consideration to be paid upon the exercise
of one Right be less than the  aggregate  par  value,  if any,  of the shares of
capital stock of the  Corporation to be issued upon exercise of one Right.  Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such  distribution  is not so made,  the Purchase  Price shall
again be adjusted to be the Purchase  Price that would then be in effect if such
record date had not been fixed.

          11.4. Computation of "Current Per Share Market Price."

               11.4.1.  For  the  purpose  of  any  computation  hereunder,  the
"current per share market price" of any security (a  "Security"  for the purpose
of this  Section  11.4.1) on any date  shall be deemed to be the  average of the
daily closing prices per share of such Security for the thirty (30)  consecutive
Trading  Days  immediately  prior  to and not  including  such  date;  provided,
however,  that in the  event  that the  current  per share  market  price of the
Security is determined  during a period following the announcement by the issuer
of such Security of (A) a dividend or distribution  on such Security  payable in
shares of such Security or securities  convertible into such shares,  or (B) any
subdivision,  combination or  reclassification of such Security and prior to the
expiration of thirty (30) Trading Days after (but not including) the ex-dividend
date for such dividend or distribution, or the record date for such subdivision,
combination  or  reclassification,  then, and in each such case, the current per
share market price shall be appropriately adjusted to reflect the current market
price per share  equivalent  of such  Security.  The closing  price for each day
shall be the last sale price,  regular way, or, in case no such sale takes place
on such day,  the average of the closing bid and asked  prices,  regular way, in
either case as  reported in the  principal  consolidated  transaction  reporting
system with respect to securities  listed or admitted to trading on the New York
Stock  Exchange  or, if the Security is not listed or admitted to trading on the
New York Stock Exchange, as reported in the principal  consolidated  transaction
reporting  system with respect to securities  listed on the  principal  national

                                       17
<PAGE>

securities  exchange on which the  Security is listed or admitted to trading or,
if the Security is not listed or admitted to trading on any national  securities
exchange,  the last quoted  price or, if not so quoted,  the average of the high
bid and low asked  prices in the  over-the-counter  market,  as  reported by the
National  Association of Securities  Dealers,  Inc. Automated  Quotations System
("NASDAQ")  or such  other  system  then in use,  or,  if on any  such  date the
Security is not quoted by any such organization,  the average of the closing bid
and asked prices as furnished by a professional  market maker making a market in
the Security  selected by the Board of Directors of the  Corporation.  If on any
such date no such  market  maker is making a market  in the  Security,  the fair
value of the Security on such date as  determined  in good faith by the Board of
Directors of the Corporation  shall be used. The term "Trading Day" shall mean a
day on which the principal national securities exchange on which the Security is
listed or admitted to trading is open for the transaction of business or, if the
Security  is not  listed or  admitted  to  trading  on any  national  securities
exchange, a Business Day.

               11.4.2.  For  the  purpose  of  any  computation  hereunder,  the
"current per share market price" of the  Preferred  Stock shall be determined in
accordance  with the  method  set  forth in  Section  11.4.1.  If the  shares of
Preferred Stock are not publicly traded, the "current per share market price" of
the  Preferred  Stock shall be  conclusively  deemed to be the current per share
market  price of the Common  Stock as  determined  pursuant  to  Section  11.4.1
(appropriately  adjusted to reflect any stock split,  stock  dividend or similar
transaction  occurring  after the date hereof),  multiplied by 1,000. If neither
the  Common  Stock nor the  Preferred  Stock are  publicly  held or so listed or
traded,  "current  per share  market  price"  shall  mean,  with  respect to the
Preferred  Stock,  the fair value per share as  determined  in good faith by the
Board of Directors of the Corporation, 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.

          11.5. Anything herein to the contrary  notwithstanding,  no adjustment
in the Purchase Price shall be required unless such adjustment  would require an
increase or decrease of at least 1% in the Purchase  Price;  provided,  however,
that any adjustments  that by reason of this Section 11.5 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 one  one-thousandth  (1/1000th)  of a share of  Preferred
Stock or of any other share or security as the case may be.  Notwithstanding the
first sentence of this Section 11.5, 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 Final Expiration Date.

          11.6. If as a result of an adjustment  made pursuant to Section 11.1.2
or Section  13.1  hereof,  the holder of any Right  thereafter  exercised  shall
become entitled to receive any shares of capital stock of the Corporation  other
than Preferred  Stock,  thereafter the number of other shares so receivable upon
exercise  of any Right  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  Section  11.1  through  11.3,
inclusive,  and the  provisions  of Sections 7, 9, 10, 13 and 14 with respect to
the Preferred Stock shall apply on like terms to any such other shares.

                                       18
<PAGE>

          11.7. All Rights  originally  issued by the Corporation  subsequent to
any adjustment  made to the Purchase Price hereunder shall evidence the right to
purchase,  at the adjusted  Purchase  Price,  the number of one  one-thousandths
(1/1000ths)  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.

          11.8. The Corporation may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights,  in lieu of any adjustment
in the number of one  one-thousandths  (1/1000ths) of a share of Preferred Stock
purchasable upon the exercise of a Right.  Each of the Rights  outstanding after
such  adjustment of the number of Rights shall be exercisable  for the number of
one one-thousandths  (1/1000ths) 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)  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  Corporation  shall make a public  announcement  of its  election to
adjust the number of Rights, indicating the record date for the adjustment, and,
if known at the  time,  the  amount  of the  adjustment  to be made,  and  shall
promptly  deliver a copy of such public  announcement to the Rights Agent.  This
record date may be the date on which the  Purchase  Price is adjusted or any day
thereafter,  but, if the Right Certificates have been issued,  shall be at least
ten  (10)  days  later  than  the  date of the  public  announcement.  If  Right
Certificates  have been  issued,  upon each  adjustment  of the number of Rights
pursuant  to  this  Section  11.8,  the   Corporation   shall,  as  promptly  as
practicable,  cause to be distributed to holders of record of Right Certificates
on such record date Right 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  Corporation,  shall  cause to be
distributed to such holders of record in  substitution  and  replacement for the
Right  Certificates  held by such holders prior to the date of  adjustment,  and
upon surrender thereof,  if required by the Corporation,  new Right Certificates
evidencing  all the Rights to which such  holders  shall be entitled  after such
adjustment.  Right  Certificates so to be distributed shall be issued,  executed
and  countersigned  in the manner provided for herein and shall be registered in
the names of the  holders of record of Right  Certificates  on the  record  date
specified in the public announcement.

          11.9.  Irrespective  of any adjustment or change in the Purchase Price
or the number of one  one-thousandths  (1/1000ths) of a share of Preferred Stock
issuable upon the exercise of the Rights, the Right Certificates theretofore and
thereafter  issued may continue to express the Purchase  Price and the number of
one  one-thousandths  (1/1000ths)  of a  share  of  Preferred  Stock  that  were
expressed in the initial Right Certificates issued hereunder.

          11.10.  Before  taking  any  action  that  would  cause an  adjustment
reducing the Purchase  Price below the then par value,  if any, of the number of
one  one-thousandths  (1/1000ths) of a share of Preferred Stock, share of Common
Stock or other securities  issuable upon exercise of the Rights, the Corporation
shall take any  corporate  action that may, in the  opinion of its  counsel,  be
necessary  in order that the  Corporation  may validly  and  legally  issue such

                                       19
<PAGE>

number of fully paid and  non-assessable  one  one-thousandths  (1/1000ths) of a
share of  Preferred  Stock,  share of Common Stock or other  securities  at such
adjusted Purchase Price.

          11.11.  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 Corporation may elect to defer until the occurrence of such
event the issuance to the holder of any Right  exercised  after such record date
of the  Preferred  Stock,  shares of  Common  Stock or other  securities  of the
Corporation,  if any,  issuable  upon such exercise over and above the Preferred
Stock,  shares of Common Stock or other securities of the  Corporation,  if any,
issuable upon such  exercise on the basis of the Purchase  Price in effect prior
to such adjustment;  provided,  however,  that the Corporation  shall deliver to
such holder a due bill or other appropriate  instrument evidencing such holder's
right to  receive  such  additional  shares  upon the  occurrence  of the  event
requiring  such  adjustment  and  shall  deliver  to the  Rights  Agent a notice
describing the terms of such due bill or other appropriate instrument.

          11.12.  Anything in this Section 11 to the  contrary  notwithstanding,
the Corporation 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 the Corporation in its sole discretion  shall determine to be
advisable in order that any (i)  consolidation  or  subdivision of the Preferred
Stock, (ii) issuance wholly for cash of Preferred Stock at less than the current
market price,  (iii) issuance  wholly for cash of Preferred  Stock or securities
that by their terms are convertible  into or exchangeable  for Preferred  Stock,
(iv) stock dividends or (v) issuance of rights,  options or warrants referred to
in  this  Section  11,  hereafter  made by the  Corporation  to  holders  of its
Preferred Stock shall not be taxable to such holders.

          11.13. The Corporation  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  Corporation  in a  transaction  that does not violate
Section  11.14  hereof),  (ii) merge with or into any other Person (other than a
Subsidiary of the  Corporation  in a transaction  that does not violate  Section
11.14  hereof),  or (iii) sell or transfer (or permit any  Subsidiary to sell or
transfer),  in one transaction,  or a series of related transactions,  assets or
earning  power  aggregating  more than 50% of the assets or earning power of the
Corporation  and its  Subsidiaries  (taken as a whole)  to any  other  Person or
Persons (other than the  Corporation  and/or any of its  Subsidiaries  in one or
more transactions  each of which does not violate Section 11.14 hereof),  if (x)
at the  time  of or  immediately  after  such  consolidation,  merger,  sale  or
transfer,  there are any charter or bylaw provisions or any rights,  warrants or
other  instruments  or securities  outstanding  or agreements in effect or other
actions taken that would materially 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, sale or transfer, the stockholders
of the Person who constitutes,  or would  constitute,  the "Principal Party" for
purposes of Section 13.1 hereof  shall have  received a  distribution  of Rights
previously  owned by such Person or any of its  Affiliates and  Associates.  The
Corporation  shall  not  consummate  any  such  consolidation,  merger,  sale or
transfer  unless prior thereto the  Corporation and such other Person shall have
executed and delivered to the Rights Agent a supplemental  agreement  evidencing
compliance with this Section 11.13.

                                       20
<PAGE>

          11.14.   The  Corporation   covenants  and  agrees  that,   after  the
Distribution  Date,  it will not,  except as  permitted by Section 23 or Section
25.2 hereof,  take (or permit any  Subsidiary to take) any action the purpose of
which is to, or if at the time such action is taken it is reasonably foreseeable
that the effect of such action is to, materially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.

          11.15.  The exercise of Rights under Section  11.1.2 shall only result
in the loss of rights under Section  11.1.2 to the extent so exercised and shall
not otherwise affect the rights  represented by the Rights under this Agreement,
including the rights represented by Section 13.

     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 Corporation shall promptly (a) prepare a certificate  setting forth
such  adjustment  and a  brief,  reasonably  detailed  statement  of the  facts,
computations and methodology  accounting for such adjustment,  (b) file with the
Rights Agent and with each transfer agent for the Common Stock and the Preferred
Stock a copy of such  certificate  and (c) mail a brief summary  thereof to each
holder of a Right Certificate in accordance with Section 25.1 hereof. The Rights
Agent shall be fully  protected  in relying on any such  certificate  and on any
adjustment  therein  contained and shall have no duty with respect to, and shall
not be deemed to have  knowledge of, such  adjustment  unless and until it shall
have received such certificate.

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

          13.1. In the event that, on or following the Shares  Acquisition Date,
directly or indirectly,  (x) the Corporation  shall  consolidate  with, or merge
with and into, any Interested Stockholder or, if in such merger or consolidation
all holders of shares of Common Stock are not treated  alike,  any other Person,
(y) the  Corporation  shall  consolidate  with,  or merge with,  any  Interested
Stockholder  or, if in such  merger or  consolidation  all  holders of shares of
Common Stock are not treated alike, any other Person,  and the Corporation shall
be the  continuing  or surviving  corporation  of such  consolidation  or merger
(other than, in a case of any  transaction  described in (x) or (y), a merger or
consolation  that would result in all of the  securities  generally  entitled to
vote in the  election of  directors  of the  Corporation  ("voting  securities")
outstanding  immediately  prior  thereto  continuing  to  represent  (either  by
remaining  outstanding or by being  converted  into  securities of the surviving
entity) all of the voting securities of the Corporation or such voting surviving
entity  outstanding  immediately  after  such  merger or  consolidation  and the
holders  of such  securities  not having  changed as a result of such  merger or
consolidation),  or (z) the Corporation shall sell or otherwise transfer (or one
or  more  of  its  Subsidiaries  shall  sell  or  otherwise  transfer),  in  one
transaction  or a series  of  related  transactions,  assets  or  earning  power
aggregating  more than 50% of the assets or earning power of the Corporation and
its  Subsidiaries   (taken  as  a  whole)  to  any  Interested   Stockholder  or
Stockholders  or, if in such  transaction  all  holders of Common  Stock are not
treated alike, any other Person (other than the Corporation or any Subsidiary of
the  Corporation  in one or more  transactions  each of which  does not  violate
Section  11.14  hereof),  then,  and in each such case  (except as  provided  in
Section 13.4 hereof),  proper provision shall be made so that (i) each holder of
a Right,  except as provided in Section 7.6 hereof,  shall  thereafter  have the

                                       21
<PAGE>

right to receive  upon  exercise  thereof,  at a total  price  equal to the then
current  Purchase  Price  multiplied by the number of one  one-thousandths  of a
share of Preferred  Stock for which a Right is then  exercisable,  in accordance
with the terms of this Agreement and in lieu of Preferred Stock,  such number of
freely  tradable shares of Common Stock of the Principal  Party,  not subject to
any liens,  encumbrances,  rights of first refusal or other adverse  claims,  as
shall equal the result  obtained by (A)  multiplying  the then current  Purchase
Price by the number of one  one-thousandths  (1/1000ths) of a share of Preferred
Stock for which a Right is then  exercisable  (without  taking into  account any
adjustment previously made pursuant to Section 11.1.2) and dividing that product
by (B) 50% of the then  current per share  market  price of the Common  Stock of
such Principal Party (determined pursuant to Section 11.4 hereof) 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  Corporation  pursuant to this Agreement;
(iii)  the  term  "Corporation"  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;  and (iv) such Principal Party shall take such
steps (including,  but not limited to, the reservation of a sufficient number of
its shares of 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 the
shares of Common Stock thereafter deliverable upon the exercise of the Rights.

          13.2. "Principal Party" shall mean:

               13.2.1. in the case of any transaction described in clause (x) or
(y) of the first  sentence of Section 13.1, the Person that is the issuer of any
securities into which shares of Common Stock of the Corporation 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  (including,  if
applicable, the Corporation if it is the surviving corporation); and

               13.2.2. in the case of any transaction described in clause (z) of
the first sentence of Section 13.1,  the Person that is the party  receiving the
greatest  portion of the assets or earning  power  transferred  pursuant to such
transaction or  transactions;  provided,  however,  that in any of the foregoing
cases,  (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 shares of Common  Stock of which are and have
been so registered,  "Principal Party" shall refer to such other Person;  (2) in
case such  Person is a  Subsidiary,  directly  or  indirectly,  of more than one
Person,  the shares of Common Stock of two or more of which are and have been so
registered,  "Principal  Party"  shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest  aggregate  market value; and (3)
in case such Person is owned, directly or indirectly,  by a joint venture formed
by two or more Persons that are not owned,  directly or indirectly,  by the same
Person,  the rules set  forth in (1) and (2)  above  shall  apply to each of the
chains of  ownership  having an interest in such joint  venture as if such party
were a  "Subsidiary"  of both or all of such joint  venturers  and the Principal
Parties in each such chain shall bear the  obligations set forth in this Section
13 in the same ratio as their  direct or indirect  interests in such Person bear
to the total of such interests.

                                       22
<PAGE>

          13.3. The  Corporation  shall not  consummate any such  consolidation,
merger,  sale or transfer  unless the  Principal  Party shall have a  sufficient
number of its  authorized  shares of 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 Corporation and such Principal
Party shall have  executed  and  delivered  to the Rights  Agent a  supplemental
agreement  providing  for the  terms  set  forth in  Sections  13.1 and 13.2 and
further   providing  that,  as  soon  as  practicable  after  the  date  of  any
consolidation, merger, sale or transfer mentioned in Section 13.1, the Principal
Party at its own expense shall:

               13.3.1.  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 Final Expiration Date;

               13.3.2.  use its best  efforts to qualify or register  the Rights
and the  securities  purchasable  upon exercise of the Rights under the blue sky
laws of such jurisdictions as may be necessary or appropriate; and

               13.3.3.  deliver to holders  of the Rights  historical  financial
statements  for the  Principal  Party  that  comply  in all  respects  with  the
requirements for registration on Form 10 under the Exchange Act.

               The  provisions  of this  Section  13  shall  similarly  apply to
successive  mergers or  consolidations  or sales or other transfers.  The rights
under this Section 13 shall be in addition to the rights to exercise  Rights and
adjustments under Section 11.1.2 and shall survive any exercise thereof.

          13.4.  Notwithstanding anything in this Agreement to the contrary, the
foregoing provisions of this Section 13 shall not be applicable to a transaction
described  in clauses (x) and (y) of Section  13.1 if: (i) such  transaction  is
consummated  with a Person or  Persons  who  acquired  shares  of  Common  Stock
pursuant to a Permitted  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
Permitted Offer; and (iii) the form of consideration offered in such transaction
is the same as the form of consideration  paid pursuant to such Permitted Offer.
Upon consummation of any such transaction contemplated by this Section 13.4, all
Rights hereunder shall expire.

     14. Fractional Rights and Fractional Shares.

          14.1.  The  Corporation  shall not be required to issue  fractions  of
Rights or to distribute Right  Certificates that evidence  fractional Rights. In

                                       23
<PAGE>

lieu of such fractional Rights, there shall be paid to the registered holders of
the  Right  Certificates  with  regard to which  such  fractional  Rights  would
otherwise  be  issuable  an amount  in cash  equal to the same  fraction  of the
current  market value of a whole Right.  For the purposes of this Section  14.1,
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 for any
day shall be the last sale price,  regular  way,  or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal  consolidated  transaction reporting
system with respect to securities  listed or admitted to trading on the New York
Stock  Exchange  or, if the Rights are not listed or  admitted to trading on the
New York Stock Exchange, as reported in the principal  consolidated  transaction
reporting  system with respect to securities  listed on the  principal  national
securities exchange on which the Rights are listed or admitted to trading or, if
the Rights  are not listed or  admitted  to trading on any  national  securities
exchange,  the last quoted  price or, if not so quoted,  the average of the high
bid and low asked prices in the  over-the-counter  market, as reported by NASDAQ
or such  other  system  then in use or, if on any such date the  Rights  are not
quoted by any such organization, the average of the closing bid and asked prices
as  furnished  by a  professional  market  maker  making a market in the  Rights
selected by the Board of  Directors of the  Corporation.  If on any such date no
such market maker is making a market in the Rights, the fair value of the Rights
on such  date as  determined  in good  faith by the  Board of  Directors  of the
Corporation shall be used.

          14.2.  The  Corporation  shall not be required to issue  fractions  of
shares of Preferred  Stock  (other than  fractions  that are one  one-thousandth
(1/1000th) or integral multiples of one one-thousandth  (1/1000th) of a share of
Preferred Stock) upon exercise of the Rights or to distribute  certificates that
evidence fractional shares of Preferred Stock (other than fractions that are one
one-thousandth (1/1000th) or integral multiples of one one-thousandth (1/1000th)
of a share of  Preferred  Stock).  Fractions  of  shares of  Preferred  Stock in
integral  multiples  of one  one-thousandth  (1/1000th)  of a share of Preferred
Stock may, at the  election  of the  Corporation,  be  evidenced  by  depositary
receipts,  pursuant to an appropriate  agreement  between the  Corporation and a
depositary  selected by it;  provided that such agreement shall provide that the
holders of such  depositary  receipts  shall  have the  rights,  privileges  and
preferences  to which they are entitled as  beneficial  owners of the  Preferred
Stock represented by such depositary  receipts.  In lieu of fractional shares of
Preferred Stock that are not one one-thousandth (1/1000th) or integral multiples
of one one-thousandth  (1/1000th) of a share of Preferred Stock, the Corporation
shall  pay to the  registered  holders  of Right  Certificates  at the time such
Rights  are  exercised  as herein  provided  an amount in cash equal to the same
fraction of the current  market value of one share of Preferred  Stock.  For the
purposes of this Section 14.2,  the current market value of a share of Preferred
Stock shall be the closing  price of a share of Preferred  Stock (as  determined
pursuant to Section 11.4.2 hereof) for the Trading Day immediately  prior to the
date of such exercise.

          14.3.  Following the occurrence of one of the  transactions  or events
specified  in  Section 11 giving  rise to the right to receive  shares of Common
Stock,   Capital  Stock  Equivalents  (other  than  Preferred  Stock)  or  other
securities upon the exercise of a Right,  the Corporation  shall not be required
to issue  fractions of shares or units of such shares of Common  Stock,  Capital
Stock  Equivalents  or  other  securities  upon  exercise  of the  Rights  or to
distribute  certificates that evidence fractions of such shares of Common Stock,

                                       24
<PAGE>

Capital Stock Equivalents or other  securities.  In lieu of fractional shares or
units of such  shares  of  Common  Stock,  Capital  Stock  Equivalents  or other
securities,  the  Corporation  may  pay  to  the  registered  holders  of  Right
Certificates  at the time such Rights are exercised as herein provided an amount
in cash equal to the same  fraction  of the current  market  value of a share or
unit of such  shares  of  Common  Stock,  Capital  Stock  Equivalents  or  other
securities. For purposes of this Section 14.3, the current market value shall be
determined  in the manner set forth in Section  11.4  hereof for the Trading Day
immediately  prior to the  date of such  exercise  and,  if such  Capital  Stock
Equivalent  is not traded,  each such Capital  Stock  Equivalent  shall have the
value of one one-thousandth (1/1000th) of a share of Preferred Stock.

          14.4. The holder of a Right by the  acceptance of the Right  expressly
waives such holder's  right to receive any  fractional  Rights or any fractional
share upon  exercise of a Right  (except as provided  above).  The Rights  Agent
shall not be deemed to have  knowledge  of, and shall have no duty or obligation
in respect of, the issuance of fractional Rights or fractional shares unless and
until it shall have received  instructions  (and  sufficient  cash, if required)
from the  Corporation  concerning  the  issuance  of such  fractional  Rights or
fractional shares.

     15. Rights of Action.

          15.1. All rights of action in respect of this Agreement, excepting the
rights of action given to the Rights Agent under  Section 18 hereof,  are vested
in the respective  registered  holders of the Right  Certificates (and, prior to
the  Distribution  Date, the registered  holders of shares of the Common Stock);
and  any  registered   holder  of  any  Right  Certificate  (or,  prior  to  the
Distribution  Date, of shares of the Common  Stock),  without the consent of the
Rights Agent or of the holder of any other Right  Certificate  (or, prior to the
Distribution  Date,  of shares of the Common  Stock),  may,  in such  registered
holder's own behalf and for such registered holder's own benefit,  enforce,  and
may  institute  and  maintain  any  suit,  action  or  proceeding   against  the
Corporation to enforce, or otherwise act in respect of, such registered holder's
right to exercise the Rights  evidenced by such Right  Certificate in the manner
provided in such Right  Certificate and in this Agreement.  Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the  obligations  under,  and  injunctive  relief  against  actual or threatened
violations of the obligations of any Person subject to, this Agreement.  Nothing
in this Section 15 is intended to modify or limit the  authority of the Board of
Directors under Section 25.3.

          15.2.  Notwithstanding  anything in this  Agreement  to the  contrary,
neither the  Corporation  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,  judgment 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,

                                       25
<PAGE>

however,  that the Corporation must use all reasonable  efforts to have any such
injunction,  order, decree, judgment or ruling lifted or otherwise overturned as
soon as practicable.

     16. Agreement of Right Holders.

     Every holder of a Right,  by accepting  the same,  consents and agrees with
the  Corporation  and the Rights  Agent and with every  other  holder of a Right
that:

          16.1. prior to the Distribution  Date, the Rights will be transferable
only in connection with the transfer of the associated shares of Common Stock;

          16.2.  after  the  Distribution   Date,  the  Right  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  form
fully executed;

          16.3. subject to Section 6 and Section 7.7 hereof, the Corporation and
the  Rights  Agent  may deem and  treat  the  Person  in  whose  name the  Right
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
Right  Certificate or the  associated  Common Stock  certificate  made by anyone
other than the Corporation or the Rights Agent) for all purposes whatsoever, and
neither the  Corporation  nor the Rights Agent,  subject to the last sentence of
Section  7.6  hereof,  shall be  required  to be  affected  by any notice to the
contrary; and

     17. Right Certificate Holder Not Deemed a Stockholder.

     No holder,  as such,  of any Right  Certificate  shall be entitled to vote,
receive  dividends  or be deemed  for any  purpose  the  holder of shares of the
Preferred Stock or any other  securities of the Corporation that may at any time
be  issuable  on the  exercise  of the  Rights  represented  thereby,  nor shall
anything  contained  herein or in any Right  Certificate  be construed to confer
upon the  holder  of any  Right  Certificate,  as such,  any of the  rights of a
stockholder  of the  Corporation  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
24 hereof),  or to receive  dividends or other  distributions or to exercise any
preemptive  or  subscription  rights,  or  otherwise,  until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with
the provisions hereof.

     18. Concerning the Rights Agent.

          18.1.  The  Corporation  agrees to pay to the Rights Agent  reasonable
compensation  for all services  rendered by it hereunder and, from time to time,
on demand of the Rights  Agent,  its  reasonable  expenses  and counsel fees and
other  disbursements  incurred  in the  administration,  preparation,  delivery,

                                       26
<PAGE>

amendment and execution of this  Agreement and the exercise and  performance  of
its duties hereunder.  The Corporation 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 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 and  administration of this Agreement,  including
without  limitation  the costs and  expenses of  defending  against any claim of
liability  in respect of any such  action.  The costs and  expenses of enforcing
this  right  of  indemnification  shall  also be paid  by the  Corporation.  The
indemnity provided for herein shall survive the expiration of the Rights and the
termination of this Agreement.

          18.2.  The  Rights  Agent  may  conclusively  rely  upon and  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 the  acceptance and
administration  of this  Agreement  in reliance  upon any Right  Certificate  or
certificate  for  shares  of  Common  Stock  or  for  other  securities  of  the
Corporation,   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  otherwise  upon the  advice of  counsel as set forth in
Section 20 hereof.  The Rights Agent shall not be deemed to have  knowledge  of,
and  shall  have no  duty in  respect  of,  any  fact  contained  in such  Right
Certificate or certificate for shares of Common Stock or for other securities of
the  Corporation,  instrument  of  assignment  or  transfer,  power of attorney,
endorsement,   affidavit,  letter,  notice,  direction,   consent,  certificate,
statement or other paper or document unless and until it shall have received the
same.

          18.3. Anything in this Agreement to the contrary  notwithstanding,  in
no event  shall the Rights  Agent be liable  for  special,  indirect,  punitive,
incidental or consequential loss or damage of any kind whatsoever (including but
not limited to lost  profits),  even if the Rights Agent has been advised of the
likelihood of such loss or damage and regardless of the form of the action.  Any
liability of the Rights Agent under this Agreement will be limited to the amount
of fees paid by the Corporation to the Rights Agent.

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

          19.1.  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 stock
transfer or all or substantially all of 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 that such Person
would be  eligible  for  appointment  as a  successor  Rights  Agent  under  the
provisions of Section 21 hereof.

                                       27
<PAGE>

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

     20. Duties of Rights Agent.

          20.1. The Rights Agent undertakes  those duties and  obligations,  and
only the duties and  obligations,  expressly  imposed by this  Agreement (and no
implied duties or obligations)  upon the following terms and conditions,  and no
implied  duties or  obligations  shall be read into this  Agreement  against the
Rights  Agent,  by all of  which  the  Corporation  and  the  holders  of  Right
Certificates, by their acceptance thereof, shall be bound.

          20.2. Before the Rights Agent acts or refrains from acting, the Rights
Agent  may  consult  with  legal  counsel  (who  may be  legal  counsel  for the
Corporation  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 in good faith and in accordance with
such advice or opinion.

          20.3.  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 an  Acquiring  Person and the
determination  of the  current  market  price  of any  security)  be  proved  or
established by the Corporation prior to taking, suffering or omitting any action
hereunder,  such fact or matter  (unless  other  evidence in respect  thereof be
herein  specifically  prescribed)  may be deemed to be  conclusively  proved and
established by a certificate  signed by any one of the Chairman or Vice Chairman
of the Board, the Chief Executive  Officer,  the President,  any Vice President,
the  Treasurer or the Secretary of the  Corporation  and delivered to the Rights
Agent; and such certificate  shall be full  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 in good faith by it under the  provisions
of this Agreement in reliance upon such certificate.

          20.4.  The Rights  Agent  shall be liable  hereunder  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).

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

                                       28
<PAGE>

          20.6.   The  Rights  Agent  shall  not  be  under  any   liability  or
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 Right  Certificate  (except  its
countersignature  thereof);  nor shall it be  responsible  for any breach by the
Corporation  of any covenant or condition  contained in this Agreement or in any
Rights  Certificate;  nor  shall  it  be  responsible  for  any  change  in  the
exercisability  of the  Rights  (including  the  Rights  becoming  null and void
pursuant to Section 7.6 hereof) or any adjustment  required under the provisions
of Section 11,  Section 13 or Section 26 hereof or  responsible  for the manner,
method or amount of any such adjustment or the  ascertaining of the existence of
facts  that  would  require  any such  adjustment  (except  with  respect to the
exercise  of  Rights  evidenced  by  Right  Certificates  after  receipt  of the
certificate  described in Section 12 hereof);  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  Preferred  Stock or shares of Common  Stock to be
issued pursuant to this Agreement or any Right  Certificate or as to whether any
Preferred  Stock or  shares  of Common  Stock  will,  when  issued,  be  validly
authorized and issued, fully paid and non-assessable.

          20.7.  The   Corporation   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.

          20.8.  The Rights  Agent is hereby  authorized  and directed to accept
instructions  with respect to the  performance of its duties  hereunder from any
one of the Chairman or Vice Chairman of the Board, the Chief Executive  Officer,
the President,  any Vice President or the Secretary of the  Corporation,  and to
apply to such officers for advice or instructions in connection with its duties,
and such instructions  shall be full  authorization and protection of the Rights
Agent and the Rights  Agent  shall incur no  liability  for or in respect of any
action  taken,  suffered  or  omitted  by it in good  faith or lack of action in
accordance  with  instructions  of any such  officer  or for any delay in acting
while waiting for those instructions.  The Rights Agent shall incur no liability
for or in respect of its reliance upon the most recent instructions  received by
any such officer.  Any application by the Rights Agent for written  instructions
from the  Corporation  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 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  shall  not be less  than five (5)
Business Days after the date any officer of the  Corporation  actually  receives
such application,  unless any such officer shall have consented in writing to an
earlier  date)  unless,  prior to taking or  suffering  any such  action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instruction in response to such application  specifying the action to be
taken, suffered or omitted.

          20.9.  The  Rights  Agent and any  stockholder,  affiliate,  director,
officer  or  employee  of the Rights  Agent may buy,  sell or deal in any of the

                                       29
<PAGE>

Rights or other securities of the Corporation or become  pecuniarily  interested
in any transaction in which the Corporation may be interested,  or contract with
or lend money to the  Corporation 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 stockholders,  affiliate, director, officer or employee
from acting in any other capacity for the Corporation or for any other Person or
legal entity.

          20.10.  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,  negligence or  misconduct  of any such  attorneys or agents or for any
loss to the  Corporation  or any  other  Person  resulting  from any  such  act,
default, negligence or misconduct, absent gross negligence, bad faith or willful
misconduct  in the  selection  and  continued  employment  thereof  (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).

          20.11.  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.

          20.12. If, with respect to any Rights  Certificate  surrendered to the
Rights Agent for exercise or transfer,  the certificate  attached to the form of
assignment  or form of  election to  purchase,  as the case may be, has not been
completed,  the Rights  Agent shall not take any further  action with respect to
such  requested   exercise  or  transfer   without  first  consulting  with  the
Corporation.

     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  Corporation  and to each  transfer  agent of the Common  Stock or
Preferred  Stock by  registered  or certified  mail,  and, at the expense of the
Corporation,  to the holders of the Right  Certificates by first-class mail. The
Corporation may remove the Rights Agent or any successor Rights Agent upon sixty
(60) 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 or
Preferred  Stock by  registered or certified  mail,  and to holders of the Right
Certificates by first-class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting,  the Corporation  shall appoint a
successor  to the  Rights  Agent.  If the  Corporation  shall  fail to make such
appointment  within a period of sixty  (60)  days  after  giving  notice of such
removal  or  after  it has been  notified  in  writing  of such  resignation  or
incapacity by the resigning or incapacitated  Rights Agent or by the holder of a
Right Certificate (who shall, with such notice, submit his Right Certificate for
inspection  by the  Corporation),  then  the  registered  holder  of  any  Right
Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent.  Any successor  Rights  Agent,  whether  appointed by the
Corporation  or by such a  court,  shall  be (i) a Person  organized  and  doing

                                       30
<PAGE>

business  under the laws of the  United  States  or of any of the  States of New
York,  New Jersey,  California or Minnesota (or of any other state of the United
States so long as such Person is  authorized to do business in any of the States
of New York, New Jersey,  California or Minnesota),  in good standing, having an
office in any of such States,  which is subject to supervision or examination by
federal or state authority and which (or the parent corporation of which) has at
the time of its appointment as Rights Agent a combined capital and surplus of at
least $50,000,000 or (ii) an affiliate of such 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.  In case at the time such  successor  Rights Agent shall succeed to
the agency created by this Agreement,  any of the Right  Certificates shall have
been countersigned but not delivered,  any such successor Rights Agent may adopt
the  countersignature  of a  predecessor  Rights  Agent and  deliver  such Right
Certificates  so  countersigned;  and in  case  at that  time  any of the  Right
Certificates shall not have been  countersigned,  any successor Rights Agent may
countersign such Right Certificates  either in the name of the predecessor or in
the name of the  successor  Rights  Agent;  and in all  such  cases  such  Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.  Not later than the effective date of any such appointment,  the
Corporation  shall file notice  thereof in writing with the  predecessor  Rights
Agent and each transfer agent of the Common Stock or Preferred Stock, and mail a
notice thereof in writing to the registered  holders of the Right  Certificates.
Failure to give any notice  provided  for in this  Section 21,  however,  or any
defect therein,  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.

     22. Issuance of New Right Certificates.

          22.1.  Notwithstanding  any of the  provisions of this Agreement or of
the Rights to the contrary,  the Corporation may, at its option, issue new Right
Certificates  evidencing  Rights in such form as may be approved by its Board of
Directors  to reflect any  adjustment  or change in the  Purchase  Price and the
number or kind or class of shares or other  securities  or property  purchasable
under the Right  Certificates  made in  accordance  with the  provisions of this
Agreement.

          22.2.  In  connection  with  the  issuance  or  sale of  Common  Stock
following the Distribution  Date and prior to the earlier of the Redemption Date
and the Final  Expiration Date, the Corporation (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,  or upon the  exercise,  conversion or
exchange of securities,  notes or debentures issued by the Corporation,  and (b)
may in any  other  case,  if deemed  necessary  or  appropriate  by the Board of
Directors  of  the  Corporation,   issue  Right  Certificates  representing  the
appropriate number of Rights in connection with such issuance or sale; provided,
however,  that no Right  Certificate shall be issued if, and to the extent that,
appropriate  adjustment  shall  otherwise have been made in lieu of the issuance
thereof.

                                       31
<PAGE>

     23. Redemption and Termination.

          23.1. Redemption

               23.1.1.  The Board of  Directors of the  Corporation  may, at its
option,  redeem  all but not less than all of the then  outstanding  Rights at a
redemption  price  of $.001  per  Right,  as such  amount  may be  appropriately
adjusted  to reflect any stock  split,  stock  dividend  or similar  transaction
occurring  after  the date  hereof  (such  redemption  price  being  hereinafter
referred to as the "Redemption  Price"), at any time prior to the earlier of the
occurrence  of a  Section  11.1.2  Event  or  the  Final  Expiration  Date.  The
Corporation  may, at its option,  pay the  Redemption  Price either in shares of
Common Stock (based on the current per share market price of the Common Stock at
the time of redemption) or cash;  provided that if the Corporation elects to pay
the Redemption  Price in shares of Common Stock,  the  Corporation  shall not be
required to issue any fractional shares of Common Stock and the number of shares
of Common  Stock  issuable to each holder of Rights shall be rounded down to the
next whole share.

               23.1.2.  In addition,  the Board of Directors of the  Corporation
may, at its option,  at any time  following the  occurrence of a Section  11.1.2
Event and the  expiration  of any period  during  which the holder of Rights may
exercise  the Rights  under  Section  11.1.2  but prior to any  Section 13 Event
redeem  all  but  not  less  than  all of the  then  outstanding  Rights  at the
Redemption  Price (x) in connection  with any merger,  consolidation  or sale or
other transfer (in one  transaction or in a series of related  transactions)  of
assets or earning  power  aggregating  50% or more of the  earning  power of the
Corporation  and its  Subsidiaries  (taken as a whole) in which all  holders  of
shares of Common  Stock are  treated  alike and not  involving  (other than as a
holder of shares of Common Stock being  treated like all other such  holders) an
Interested  Stockholder or (y) (i) if and for so long as the Acquiring Person is
not thereafter the Beneficial  Owner of securities  representing  15% or more of
the  Voting  Power,  and (ii) at the time of  redemption  no other  Persons  are
Acquiring Persons.

          23.2.  In the case of a redemption  permitted  under  Section  23.1.1,
immediately  upon the date for  redemption  set forth in (or  determined  in the
manner  specified in) a resolution of the Board of Directors of the  Corporation
ordering  the  redemption  of the Rights,  and  without  any further  action and
without any notice, the right to exercise the Rights will terminate and the only
right  thereafter  of the holders of Rights  shall be to receive the  Redemption
Price for each Right so held. In the case of a redemption  permitted  only under
Section  23.1.2,  the right to exercise the Rights will  terminate and represent
only the  right to  receive  the  Redemption  Price  upon the  later of ten (10)
Business  Days  following  the giving of such  notice or the  expiration  of any
period  during  which the Rights may be  exercised  under  Section  11.1.2.  The
Corporation  shall  promptly  give public  notice of any such  redemption  (with
prompt notice thereof to the Rights Agent); provided,  however, that the failure
to give, or any defect in, any such notice shall not affect the validity of such
redemption.  Within ten (10) days after such date for  redemption set forth in a
resolution of the Board of Directors of the Corporation  ordering the redemption
of the Rights,  the Corporation  shall mail a notice of redemption to the Rights
Agent  and all the  holders  of the then  outstanding  Rights at (in the case of
notice to holders) their addresses as they appear upon the registry books of the
Rights Agent or, prior to the  Distribution  Date, on the registry  books of the

                                       32
<PAGE>

transfer  agent for the Common  Stock.  Any notice which is mailed in the manner
herein  provided shall be deemed given,  whether or not the holder  receives the
notice.  Each  such  notice of  redemption  will  state the  method by which the
payment of the Redemption Price will be made. Neither the Corporation nor any of
its  Affiliates  or  Associates  may redeem,  acquire or purchase  for value any
Rights at any time in any manner  other than as  specifically  set forth in this
Section 23 and other than in  connection  with the  purchase of shares of Common
Stock prior to the Distribution Date.

          23.3.  The  Corporation  may,  at  its  option,  discharge  all of its
obligations with respect to the Rights by (i) issuing a press release announcing
the manner of redemption of the Rights in accordance  with this Agreement  (with
prompt  notice  thereof to the Rights  Agent)  and (ii)  mailing  payment of the
Redemption  Price to the registered  holders of the Rights at their addresses as
they  appear  on the  registry  books  of the  Rights  Agent  or,  prior  to the
Distribution  Date,  on the registry  books of the Transfer  Agent of the Common
Stock, and upon such action, all outstanding Rights and Right Certificates shall
be null and void without any further action by the Corporation.

     24. Notice of Certain Events.

          24.1.  In case the  Corporation  shall propose (i) to pay any dividend
payable in stock of any class to the holders of its  Preferred  Stock or to make
any other  distribution  to the  holders of its  Preferred  Stock  (other than a
regular quarterly cash dividend),  (ii) to offer to the holders of its Preferred
Stock  rights  or  warrants  to  subscribe  for or to  purchase  any  additional
Preferred Stock or shares of stock of any class or any other securities,  rights
or options,  (iii) to effect any  reclassification of its Preferred Stock (other
than a reclassification  involving only the subdivision of outstanding Preferred
Stock), (iv) to effect any consolidation or merger into or with any other Person
(other than a Subsidiary  of the  Corporation  in a  transaction  which does not
violate  Section 11.14  hereof),  or to effect any sale or other transfer (or to
permit one or more of its  Subsidiaries to effect any sale or other transfer) in
one or more  transactions,  of 50% or more of the assets or earning power of the
Corporation  and its  Subsidiaries  (taken as a whole)  to any  other  Person or
Persons (other than the  Corporation  and/or any of its  Subsidiaries  in one or
more transactions  each of which does not violate Section 11.14 hereof),  or (v)
to effect the liquidation,  dissolution or winding up of the Corporation,  then,
in each such case,  the  Corporation  shall  give the  Rights  Agent and to each
holder of a Right Certificate, in accordance with Section 25 hereof, a notice of
such  proposed  action  which shall  specify the record date for the purposes of
such stock dividend or 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 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 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
Preferred Stock, whichever shall be the earlier.

                                       33
<PAGE>

          24.2.  In case of a Section  11.1.2  Event,  then (i) the  Corporation
shall as soon as  practicable  thereafter  give to the Rights  Agent and to each
holder of a Right  Certificate,  in accordance  with Section  25.1.3  hereof,  a
notice of the  occurrence of such event,  which notice shall describe such event
and the  consequences  of such event to holders of Rights under  Section  11.1.2
hereof, and (ii) all references in the preceding Section 24.1 to Preferred Stock
shall be deemed  thereafter to refer also to shares of Common Stock  and/or,  if
appropriate, other securities of the Corporation.

     25. Miscellaneous.

          25.1. Notices.

               25.1.1.  Notices or demands  authorized  by this  Agreement to be
given or made by the Rights Agent or by the holder of any Right  Certificate  to
or on the Corporation shall be sufficiently  given or made if sent by registered
or  certified  mail and shall be deemed  given upon  receipt,  addressed  (until
another address is filed in writing with the Rights Agent) as follows:

                  Washington Mutual, Inc.
                  1201 Third Avenue
                  Seattle, Washington 98101
                  Attention:  Corporate Secretary

               25.1.2.  Subject to the  provisions  of  Section  21 hereof,  any
notice  or  demand  authorized  by this  Agreement  to be  given  or made by the
Corporation or by the holder of any Right  Certificate to or on the Rights Agent
shall be  sufficiently  given or made if sent  registered or certified  mail and
shall be deemed given upon receipt, addressed (until another address is filed in
writing with the Corporation) as follows:

                  Mellon Investor Services, L.L.C.
                  520 Pike Street, Suite 1220
                  Seattle, Washington  98101
                  Attention: Relationship Manager

                  with a copy to:

                  Mellon Investor Services, L.L.C.
                  85 Challenger Road
                  Ridgefield Park, New Jersey 07660-2108
                  Attention:  General Counsel

               25.1.3.  Notices or demands  authorized  by this  Agreement to be
given or made by the  Corporation or the Rights Agent to the holder of any Right
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 Corporation.

                                       34
<PAGE>

          25.2.  Supplements  and  Amendments.  The Corporation may from time to
time supplement or amend any provision of this Agreement without the approval of
any holders of Rights in order to cure any ambiguity, to correct,  supplement or
amend any provision  herein,  or to make any other provision with respect to the
Rights  which  the  Corporation  may  deem  necessary  or  desirable,  any  such
supplement or amendment to be evidenced by a writing  signed by the  Corporation
and the  Rights  Agent;  provided,  however,  that  from and  after  any  Shares
Acquisition  Date this  Agreement  shall not be amended in any manner which will
adversely  affect the interest of the holders of Rights.  Upon the delivery of a
certificate from an appropriate officer of the Corporation which states that the
proposed supplement or amendment is in compliance with the terms of this Section
25.2,  and, if requested by the Rights Agent,  an opinion of counsel that states
that the proposed  supplement  or amendment  complies  with this Section 25, the
Rights  Agent  shall  execute  such  supplement  or  amendment.   Prior  to  the
Distribution  Date,  the  interests  of the  holders  of Rights  shall be deemed
coincident  with the  interests of the holders of shares of Common  Stock.  This
Agreement shall not be amended,  without the prior written consent of the Rights
Agent, in any manner that affects the rights, duties,  obligations or immunities
of the Rights Agent.

          25.3.  Determination  and Actions by the Board of Directors,  etc. The
Board of  Directors  of the  Corporation  shall  have the  exclusive  power  and
authority to  administer  this  Agreement  and to exercise all rights and powers
specifically granted to the Board, or the Corporation, 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,  without limitation, a determination to redeem or not
redeem the Rights or to amend the Agreement  and whether any proposed  amendment
adversely affects the interests of the holders of Right  Certificates).  For all
purposes of this  Agreement,  any  calculation of the number of shares of Common
Stock or other  securities  outstanding  at any particular  time,  including for
purposes of determining the particular  percentage of such outstanding shares of
Common  Stock or any  other  securities  of which any  Person is the  Beneficial
Owner, shall be made in accordance with the last sentence of Rule 13d-3(d)(1)(i)
of the General Rules and Regulations  under the Exchange Act as in effect on the
date of this  Agreement.  All such actions,  calculations,  interpretations  and
determinations  (including, for purposes of clause (y) below, all omissions with
respect  to the  foregoing)  which are done or made by the Board in good  faith,
shall (x) be final, conclusive and binding on the Corporation, the Rights Agent,
the holders of the Right Certificates and all other Persons, and (y) not subject
the Board to any liability to the holders of the Right Certificates.  The Rights
Agent shall be fully protected and shall incur no liability for or in respect of
its  reliance on the good faith of the  Corporation's  Board of  Directors  with
respect to actions done or made in connection with such calculation.  Nothing in
Section 15 hereof is intended to modify or limit this Section 25.3.

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

                                       35
<PAGE>

          25.5.  Benefits of this Agreement.  Nothing in this Agreement shall be
construed to give to any Person or corporation  other than the Corporation,  the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the shares of Common Stock) any legal or equitable right,
remedy or claim under this  Agreement.  This Agreement shall be for the sole and
exclusive  benefit  of the  Corporation,  the  Rights  Agent and the  registered
holders of the Right  Certificates  (and,  prior to the  Distribution  Date, the
shares of Common Stock).

          25.6. 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.

          25.7.  Governing  Law.  This  Agreement,  each  Right  and each  Right
Certificate  issued  hereunder  shall be deemed to be a contract  made under the
laws of the State of  Washington  and for all purposes  shall be governed by and
construed in accordance  with the laws of such State  applicable to contracts to
be made and performed  entirely  within such State,  except that all  provisions
regarding  the  rights,  duties and  obligations  of the Rights  Agent  shall be
governed  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.

          25.8.  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.

          25.9.  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.

     26. Exchange.

          26.1.  Notwithstanding  any  other  provision  hereof,  the  Board  of
Directors of the  Corporation  may, at its option,  at any time after any Person
becomes an Acquiring  Person,  exchange all or part of the then  outstanding and
exercisable  Rights  (which  shall not include  Rights that have become null and
void  pursuant  to the  provisions  of Section  7.6 hereof) for shares of Common
Stock of the  Corporation  at an  exchange  ratio  determined  by  dividing  the
then-applicable exercise price of the Rights determined under Section 7.2 by the
"current per share  market  price" as defined in Section  11.4.1 (such  exchange
ratio being hereinafter  referred to as the "Exchange  Ratio").  Notwithstanding
the foregoing,  the  Corporation's  Board of Directors shall not be empowered to
effect such exchange at any time after any Person  (other than the  Corporation,
any Subsidiary of the Corporation,  any employee benefit plan of the Corporation
or any such Subsidiary, or any Person organized, appointed or established by the
Corporation  for or  pursuant  to the  terms  of any such  plan or any  trustee,
administrator  or fiduciary of such a plan),  together with all  Affiliates  and
Associates of such Person,  becomes the Beneficial Owner of shares  representing
50% or more of the Voting Power.

                                       36
<PAGE>

          26.2.  Immediately  upon the action of the Board of  Directors  of the
Corporation  ordering  the  exchange of any Rights  pursuant to Section 26.1 and
without any further  action and without any notice,  the right to exercise  such
rights  shall  terminate  and the only  right  thereafter  of the holder of such
Rights (other than a holder of Rights that have become null and void pursuant to
the  provisions of Section 7.6 hereof) 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  Corporation  shall promptly give public
notice,  and  shall  promptly  give  notice  to the  Rights  Agent,  of any such
exchange;  provided,  however,  that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange.  The Corporation promptly
shall mail a notice of any such exchange to all of the holders of such Rights at
their last addresses as they appear upon the registry books of the Rights Agent.
Any notice which is mailed in the manner herein  provided shall be deemed given,
whether or not the holder  receives  the  notice.  Each such  notice of exchange
shall state the method by which the exchange of the Common Stock for Rights will
be  effected  and, in the event of any  partial  exchange,  the number of Rights
which will be exchanged.  Any partial  exchange shall be effected pro rata based
on the number of Rights  (other  than  Rights  which have  become  null and void
pursuant to the provisions of Section 7.6) held by each holder of Rights.

          26.3. 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 26, the
Corporation  shall take all such action as may be necessary to issue  additional
shares of Common Stock, Preferred Stock and/or Capital Stock Equivalents with an
aggregate  current  market value (as determined by the Board of Directors of the
Corporation)  equal to the aggregate  current market value of a number of shares
of Common Stock equal to the Exchange Ratio.

                                       37

<PAGE>

          27.  Certain  Beneficial  Owners.  If  any  Person  provides  evidence
satisfactory to the Board of Directors of the Corporation  that such Person was,
as of  immediately  prior to the public  announcement  of the  execution of this
Agreement, the Beneficial Owner of shares representing 15% or more of the Voting
Power,  neither such Person nor any of such  Person's  Affiliates  or Associates
shall be deemed an Acquiring Person solely by reason of such Person's beneficial
ownership of such shares. Such Person shall be deemed an Acquiring Person in the
event that such Person  acquires  beneficial  ownership  of any other  shares of
Common Stock than those referred to in the immediately preceding sentence, which
other shares,  when  aggregated  with any shares  referred to in the immediately
preceding sentence, represent more than 15% of the Voting Power.

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

                                       WASHINGTON MUTUAL, INC.

Attest:
                                       By:
                                       ----------------------------------------
                                       Kerry K. Killinger
                                       Its President and Chief Executive Officer

                                        MELLON INVESTOR
                                        SERVICES, L.L.C., as Rights Agent

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

                                       38

<PAGE>
                          MELLON INVESTOR SERVICES LLC

                                Schedule of Fees
                                       as
                                  Rights AGent
                                      for
                            Washington Mutual, Inc.

================================================================================

Acceptancee Fee                                                        $1,500.00

Annual Administrative Fee                                              $3,500.00
*    Payable at the start of the billing year.

Out-of-Pocket Expenses                                                Additional
*    Legal Review
*    Includes stationary, postage, messenger service charges, etc.

<PAGE>

                                    Exhibit A

                                     Form of
                   Certificate of Designation, Preferences and
                       Rights of Series RP Preferred Stock

                                       of

                             Washington Mutual, Inc.

      (Pursuant toss.23B.06.020 of the Washington Business Corporation Act)

     I,_______________________  ,  Secretary of  Washington  Mutual,  Inc.  (the
"Corporation"),  a  corporation  organized  and  existing  under the  Washington
Business   Corporation  Act,  in  accordance  with  the  provisions  of  Section
23B.01.200 thereof, DO HEREBY CERTIFY:

     That pursuant to the authority conferred upon the Board of Directors of the
Corporation by the Restated Certificate of Incorporation of the Corporation, the
said Board of Directors has adopted the following  resolutions creating a series
of 700,000 shares of Preferred Stock designated as Series RP Preferred Stock.

     RESOLVED, that pursuant to the authority granted to and vested in the Board
of  Directors  of the  Corporation  in  accordance  with the  provisions  of the
Articles of  Incorporation  of the  Corporation,  the Board of Directors  hereby
creates  a series of Series  RP  Preferred  Stock,  with a par value of $.01 per
share,  of the  Corporation  and  hereby  states the  designation  and number of
shares,  and fixes the relative rights,  preferences and limitations  thereof as
follows (the following  provisions  being intended to operate in addition to any
other provisions of said Articles of  Incorporation  applicable to any series of
Preferred Stock):

                            Series RP Preferred Stock

     Section 1.  Designation,  Par Value and  Amount.  The shares of such series
shall be designated as "Series RP Preferred Stock"  (hereinafter  referred to as
"Series RP Preferred Stock"),  the shares of such series shall be with par value
of $.01 per share,  and the number of shares  constituting  such series shall be
700,000;  provided,  however,  that,  if more than a total of 700,000  shares of
Series RP  Preferred  Stock shall be issuable  upon the  exercise of Rights (the
"Rights")  issued  pursuant to the Rights  Agreement,  dated as of December  20,
2000,  between the Corporation and Mellon Investor  Services,  L.L.C., as Rights
Agent (as  amended  from time to time,  the  "Rights  Agreement"),  the Board of
Directors of the  Corporation  shall direct by resolution or resolutions  that a
certificate be properly executed, acknowledged and filed providing for the total
number of shares of Series  RP  Preferred  Stock  authorized  to be issued to be
increased (to the extent that the Articles of Incorporation then permits) to the
largest number of whole shares (rounded up to the nearest whole number) issuable
upon exercise of the Rights.

<PAGE>

     Section 2. Dividends and Distributions.
                ---------------------------

          2.1  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 RP Preferred Stock with respect to dividends, the holders of shares of
Series RP Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of  Directors  out of assets  legally  available  for the  purpose,
quarterly  dividends  payable in cash on the first business day of March,  June,
September and December in each year (each such date being  referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment  Date  after the first  issuance  of a share or  fraction  of a share of
Series RP Preferred  Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment
set forth in Section 6.1, 1,000 times the aggregate per share amount of all cash
dividends,  and 1,000 times the aggregate per share amount  (payable in kind) of
all non-cash dividends or other  distributions  other than a dividend payable in
shares of Common  Stock,  par value  $.01 per  share,  of the  Corporation  (the
"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 RP Preferred Stock.

          2.2 The  Corporation  shall declare a dividend or  distribution on the
Series RP Preferred Stock as provided in Section 2.1 above  immediately after it
declares a dividend or  distribution  on the Common Stock (other than a dividend
payable in shares of Common  Stock);  provided that, in the event no dividend or
distribution  shall have been  declared  on the Common  Stock  during the period
between any Quarterly  Dividend  Payment Date and the next subsequent  Quarterly
Dividend  Payment Date, a dividend of $1.00 per share on the Series RP Preferred
Stock  shall  nevertheless  be payable  on such  subsequent  Quarterly  Dividend
Payment Date.

          2.3 Dividends  shall begin to accrue and be cumulative on  outstanding
shares of Series RP Preferred  Stock from the  Quarterly  Dividend  Payment Date
next  preceding  the date of issue of such shares of Series RP 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 RP 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 RP 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 RP  Preferred
Stock  entitled  to  receive  payment  of a dividend  or  distribution  declared
thereon,  which  record  date  shall be not more than 30 days  prior to the date
fixed for the payment thereof.

                                       2
<PAGE>

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

          3.1 Except as provided in Section 3.3 and subject to the provision for
adjustment  hereinafter set forth, each share of Series RP Preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters  submitted to a vote of
the stockholders of the Corporation.

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

          3.3 The following  additional  provisions  shall apply with respect to
the voting of shares of Series RP Preferred Stock:

               3.3.1 If, on the date used to  determine  stockholders  of record
for any meeting of  stockholders  for the  election of  directors,  a default in
preference  dividends  (as  defined  in  Section  3.3.5  below) on the Series RP
Preferred Stock shall exist,  the holders of the Series RP Preferred Stock shall
have the right,  voting as a class as described in Section 3.3.2 below, to elect
two directors  (in addition to the directors  elected by holders of Common Stock
of the  Corporation).  Such  right  may be  exercised  (a)  at  any  meeting  of
stockholders for the election of directors or (b) at a meeting of the holders of
shares of  Voting  Preferred  Stock (as  hereinafter  defined),  called  for the
purpose  in  accordance  with the  Bylaws  of the  Corporation,  until  all such
cumulative  dividends  (referred to above) shall have been paid in full or until
non-cumulative dividends have been paid regularly for at least one year.

               3.3.2 The right of the  holders of Series RP  Preferred  Stock to
elect  two  directors,  as  described  above,  shall  be  exercised  as a  class
concurrently  with the rights of holders of any other series of Preferred  Stock
upon which voting  rights to elect such  directors  have been  conferred and are
then  exercisable.  The Series RP Preferred  Stock and any additional  series of
Preferred  Stock that the  Corporation  may issue and that may  provide  for the
right to vote with the  foregoing  series of  Preferred  Stock are  collectively
referred to herein as "Voting Preferred Stock."

               3.3.3 Each  director  elected by the  holders of shares of Voting
Preferred  Stock  shall be  referred  to herein  as a  "Preferred  Director."  A
Preferred  Director  shall  continue  to serve  as such for a term of one  year,
except that upon any termination of the right of all holders of Voting Preferred
Stock  to vote  as a class  for  Preferred  Directors,  the  term of  office  of
Preferred Directors then serving shall terminate.  Any Preferred Director may be
removed  by,  and shall not be removed  except  by,  the vote of the  holders of
record of a majority of the  outstanding  shares of Voting  Preferred Stock then
entitled to vote for the election of directors,  present (in person or by proxy)
and voting together as a single class (a) at a meeting of the  stockholders,  or
(b) at a meeting of the holders of shares of such Voting Preferred Stock, called
for the purpose in accordance with the Bylaws of the Corporation.

               3.3.4 So long as a default  in any  preference  dividends  of the
Series RP  Preferred  Stock shall  exist or the  holders of any other  series of

                                       3
<PAGE>

Voting Preferred Stock shall be entitled to elect Preferred  Directors,  (a) any
vacancy in the office of a Preferred  Director may be filled (except as provided
in the following clause (b)) by an instrument in writing signed by the remaining
Preferred  Director  and filed with the  Corporation  and (b) in the case of the
removal of any  Preferred  Director,  the  vacancy  may be filled by the vote or
written consent of the holders of a majority of the outstanding shares of Voting
Preferred Stock then entitled to vote for the election of directors, present (in
person or by proxy) and voting  together as a single class,  at such time as the
removal shall be effected. Each director appointed as aforesaid by the remaining
Preferred  Director shall be deemed,  for all purposes hereof, to be a Preferred
Director.  Whenever  (x) no default  in  preference  dividends  on the Series RP
Preferred  Stock  shall  exist  and (y) the  holders  of other  series of Voting
Preferred  Stock shall no longer be entitled to elect such Preferred  Directors,
then  the  number  of  directors  constituting  the  Board of  Directors  of the
Corporation shall be reduced by two.

               3.3.5 For purposes hereof, a "default in preference dividends" on
the Series RP  Preferred  Stock shall be deemed to have  occurred  whenever  the
amount of cumulative and unpaid dividends on the Series RP Preferred Stock shall
be  equivalent  to  six  full  quarterly  dividends  or  more  (whether  or  not
consecutive),  and,  having so occurred,  such default  shall be deemed to exist
thereafter until, but only until, all cumulative  dividends on all shares of the
Series RP Preferred Stock then outstanding shall have been paid through the last
Quarterly  Dividend  Payment  Date or  until,  but  only  until,  non-cumulative
dividends have been paid regularly for at least one year.

          3.4 Except as set forth herein (or as otherwise required by applicable
law),  holders  of Series RP  Preferred  Stock  shall have no general or special
voting  rights and their  consent shall not be required for taking any corporate
action.

     Section 4. Certain Restrictions.
                --------------------

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

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

               4.1.2 declare or pay dividends,  or make any other distributions,
on any shares of stock  ranking  on a parity  (either  as to  dividends  or upon
liquidation,  dissolution  or winding  up) with the Series RP  Preferred  Stock,
except  dividends  paid  ratably on the Series RP  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;

               4.1.3 redeem or purchase or otherwise  acquire for  consideration
(except as provided in Section 4.1.4 below)  shares of any stock ranking  junior
(either as to dividends or upon  liquidation,  dissolution or winding up) to the

                                       4
<PAGE>

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

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

          4.2 The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise  acquire for  consideration  any shares of stock of the
Corporation  unless the  Corporation  could,  under  Section  4.1,  purchase  or
otherwise acquire such shares at such time and in such manner.

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

     Section 6.  Liquidation, Dissolution or Winding Up.
                 --------------------------------------

          6.1 Subject to the prior and superior  rights of holders of any shares
of any series of  Preferred  Stock  ranking  prior and superior to the shares of
Series RP Preferred Stock with respect to rights upon  liquidation,  dissolution
or winding up (voluntary or  otherwise),  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 RP Preferred Stock unless,
prior  thereto,  the holders of shares of Series RP  Preferred  Stock shall have
received  per share an amount  equal to the  greater of 1,000  times  $200.00 or
1,000 times the payment made per share of Common Stock,  plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment (the "Series RP Liquidation Preference").  Following
the  payment of the full  amount of the  Series RP  Liquidation  Preference,  no
additional  distributions  shall be made to the  holders  of shares of Series RP
Preferred  Stock unless,  prior  thereto,  the holders of shares of Common Stock
shall have received an amount per share (the "Capital  Adjustment") equal to the
quotient  obtained by dividing (i) the Series RP Liquidation  Preference by (ii)
1,000 (as  appropriately  adjusted as set forth in Section  6.3 to reflect  such
events as stock splits,  stock dividends and  recapitalizations  with respect to
the Common Stock) (such number in clause (ii) being hereafter referred to as the
"Adjustment Number").  Following the payment of the full amount of the Series RP
Liquidation  Preference and the Capital Adjustment in respect of all outstanding

                                       5
<PAGE>

shares of Series RP Preferred Stock and Common Stock,  respectively,  holders of
Series RP  Preferred  Stock and  holders of Common  Stock  shall  receive  their
ratable and proportionate share of the remaining assets to be distributed in the
ratio of the  Adjustment  Number to 1 with respect to such  Preferred  Stock and
Common Stock, on a per share basis, respectively.

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

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

     Section 7. Consolidation,  Merger, etc. In case the Corporation shall enter
into any  consolidation,  merger,  combination or other transaction in which the
shares  of  Common  Stock are  exchanged  for or  changed  into  other  stock or
securities,  cash and/or any other property, then in any such case the shares of
Series RP  Preferred  Stock  shall at the same time be  similarly  exchanged  or
changed in an amount per share equal to the Adjustment  Number (as appropriately
adjusted  as set forth in Section 6.3 to reflect  such  events as stock  splits,
stock  dividends and  recapitalizations  with respect to the Common Stock) times
the  aggregate  amount of stock,  securities,  cash  and/or  any other  property
(payable  in kind),  as the case may be,  into  which or for which each share of
Common Stock is changed or exchanged.

     Section 8. No Redemption. The shares of Series RP Preferred Stock shall not
be redeemable.

     Section 9. Ranking.  The Series RP 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 other series shall
provide otherwise.

     Section 10.  Amendment.  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 RP 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 RP Preferred Stock,  voting
separately as a class.

                                       6
<PAGE>

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

     RESOLVED,  that the proper officers of the Corporation be, and each of them
hereby is,  authorized to execute a Certificate of  Designation  with respect to
the Series RP Preferred  Stock pursuant to Section  23B.06.020 of the Washington
Business  Corporation  Act and to take all  appropriate  action  to  cause  such
Certificate to become effective,  including,  but not limited to, the filing and
recording of such Certificate with and/or by the Secretary of State of the State
of Washington.

                  [REST OF PAGE INTENTIONALLY LEFT BLANK]

                                       7
<PAGE>

         IN WITNESS WHEREOF,  I have executed and subscribed to this Certificate
and do affirm the  foregoing as true under penalty of perjury this ____th day of
_____, 2000.

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

                                       8
<PAGE>

                                    Exhibit B

                            Form of Right Certificate

Certificate No. RP-                                                 _____ Rights

                  NOT  EXERCISABLE  AFTER JANUARY 4, 2011 OR EARLIER IF REDEEMED
                  BY THE  CORPORATION.  THE RIGHTS ARE SUBJECT TO  REDEMPTION AT
                  $.001  PER  RIGHT  ON  THE  TERMS  SET  FORTH  IN  THE  RIGHTS
                  AGREEMENT.

                                Right Certificate

                             WASHINGTON MUTUAL, INC.

         This  certifies  that  __________,   or  registered   assigns,  is  the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement,  dated as of December  20,  2000 (the  "Rights  Agreement"),  between
Washington  Mutual,  Inc., a Washington  corporation  (the  "Corporation"),  and
Mellon  Investor  Services,  L.L.C.  (the "Rights  Agent") to purchase  from the
Corporation at any time after the Distribution  Date (as such term is defined in
the Rights  Agreement)  and prior to 5:00 P.M.,  Washington  time, on January 4,
2011, unless the Rights evidenced hereby shall have been previously  redeemed by
the Corporation,  at the office of the Rights Agent designated for such purpose,
or at the office of its successor as Rights Agent, one one-thousandth (1/1000th)
of a  fully  paid  non-assessable  share  of  Series  RP  Preferred  Stock  (the
"Preferred  Stock") of the  Corporation,  at a purchase price of $200.00 per one
one-thousandth  (1/1000th) of a share of Preferred Stock (the "Purchase Price"),
upon  presentation  and  surrender  of this Right  Certificate  with the Form of
Election to Purchase duly executed. The number of Rights evidenced by this Right
Certificate  (and the number of one  one-thousandths  (1/1000ths)  of a share of
Preferred Stock that may be purchased upon exercise hereof) set forth above, and
the  Purchase  Price set forth above,  are the number and  Purchase  Price as of
January 4, 2001, based on the Preferred Stock as constituted at such date.

         Upon the  occurrence of a Section 11.1.2 Event (as such term is defined
in the Rights Agreement),  if the Rights evidenced by this Right Certificate are
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of an
Acquiring Person,  (ii) a transferee of an Acquiring Person (or of any Affiliate
or  Associate  thereof)  who becomes a  transferee  after the  Acquiring  Person
becomes such,  or (iii) a transferee of an Acquiring  Person (or of an Affiliate
or Associate thereof) 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 from
any  Affiliate  or  Associate  thereof) to holders of equity  interests  in such
Acquiring  Person  or to  any  Person  with  whom  the  Acquiring  Person  has a
continuing  agreement,  arrangement or  understanding  regarding the transferred
Rights or (B) a transfer  that the Board of  Directors  of the  Corporation  has
determined is part of a plan, arrangement or understanding that has as a primary
purpose or effect the  avoidance of Section 7.6 of the Rights  Agreement,  shall

<PAGE>

become null and void without any further  action and no holder hereof shall have
any rights  whatsoever with respect to such Rights,  whether under any provision
of the Rights Agreement or otherwise.

         As provided in the Rights Agreement,  the Purchase Price and the number
of one  one-thousandths  (1/1000ths)  of a share  of  Preferred  Stock  or other
securities  that may be purchased  upon the exercise of the Rights  evidenced by
this Right  Certificate  are subject to  modification  and  adjustment  upon the
happening  of  certain  events,  including  Triggering  Events  (as such term is
defined in the Rights Agreement).

         This Right  Certificate  is subject to all of the terms,  covenants and
restrictions of the Rights  Agreement,  which terms,  covenants and restrictions
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 Corporation and the holders of the Right  Certificates,  which
limitations of rights include the temporary  suspension of the exercisability of
such Rights under the specific  circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal executive offices of
the Corporation and the office of the Rights Agent.

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

         Subject to the provisions of the Rights Agreement, the Rights evidenced
by this  Certificate may be redeemed by the Corporation at a redemption price of
$.001 per Right  (subject to  adjustment  as  provided in the Rights  Agreement)
payable in cash.

         No  fractional  shares  of  Preferred  Stock  will be  issued  upon the
exercise of any Right or Rights  evidenced hereby (other than fractions that are
one  one-thousandth  (1/1000th)  or  integral  multiples  of one  one-thousandth
(1/1000th)  of a share of  Preferred  Stock,  which may, at the  election of the
Corporation,  be evidenced by depository  receipts),  but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.

         No  holder  of this  Right  Certificate  shall be  entitled  to vote or
receive  dividends  or be deemed  for any  purpose  the  holder of shares of the
Preferred Stock or of any other  securities of the  Corporation  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 Corporation 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

                                       2
<PAGE>

to receive notice of meetings or other actions affecting stockholders (except as
provided  in  the  Rights   Agreement),   or  to  receive   dividends  or  other
distributions  or  to  exercise  any  preemptive  or  subscription   rights,  or
otherwise,  until the Right or Rights evidenced by this Right  Certificate shall
have been exercised as provided in the Rights Agreement.

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

          WITNESS  the  facsimile  signature  of  the  proper  officers  of  the
Corporation and its corporate seal. Dated as of __________, _____.

[SEAL]
ATTEST:
                                                         WASHINGTON MUTUAL, INC.

By                                      By
  ------------------------------           -------------------------------------

Name                                    Name
    ----------------------------           -------------------------------------

Title                                   Title
     ---------------------------            ------------------------------------

Countersigned:

MELLON INVESTOR SERVICES, L.L.C.

By
  ------------------------------

Name
    ----------------------------

Title
     ---------------------------

                                       3
<PAGE>

                    Form of Reverse Side of Right Certificate

                               FORM OF ASSIGNMENT
                  (To be  executed  by the  registered  holder  if  such  holder
                  desires to transfer the Right Certificate.)

         FOR VALUE RECEIVED
                            ----------------------------------------------------
hereby sells, assigns and transfers unto
                                         ---------------------------------------

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

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

Dated:__________, _____
                                              ----------------------------------
                                              Signature

Signature Guaranteed:

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

         Signatures must be guaranteed by an "Eligible Guarantor Institution" as
defined  in Rule  17Ad-15  (or any  successor  rule or  regulation)  promulgated
pursuant to the Securities Exchange Act of 1934, as amended (this term means, in
general, banks, stock brokers, savings and loan associations, and credit unions,
in each  case with  membership  in an  approved  signature  guarantee  medallion
program).

         The undersigned  hereby certifies that (1) the Rights evidenced by this
Right Certificate are 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  thereof
(as such terms are defined in the Rights Agreement),  (2) this Right Certificate
is not being sold, assigned or transferred to or on behalf of any such Acquiring
Person,  Affiliate  or  Associate,  and (3)  after due  inquiry  and to the best
knowledge  of the  undersigned,  the  undersigned  did not  acquire  the  Rights
evidenced by this Right  Certificate  from any Person who is or was an Acquiring
Person or an Affiliate  or  Associate  thereof (as such terms are defined in the
Rights Agreement).

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

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

                          FORM OF ELECTION TO PURCHASE

                  (To be  executed  by the  registered  holder  if  such  holder
                  desires  to   exercise   Rights   represented   by  the  Right
                  Certificate)

To the Rights Agent:

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

Please insert social security number
or other identifying number
                           -----------------------------------------------------

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

Please insert social security number
or other identifying number
                           -----------------------------------------------------

                         (Please print name and address)
Dated:   __________, _____

                                    Signature
Signature Guaranteed:

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

         Signatures must be guaranteed by an "Eligible Guarantor Institution" as
defined  in Rule  17Ad-15  (or any  successor  rule or  regulation)  promulgated
pursuant to the Securities Exchange Act of 1934, as amended (this term means, in
general, banks, stock brokers, savings and loan associations, and credit unions,
in each  case with  membership  in an  approved  signature  guarantee  medallion
program).

<PAGE>

             Form of Reverse Side of Right Certificate -- continued

         The undersigned  hereby certifies that (1) the Rights evidenced by this
Right  Certificate are not being exercised by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate  thereof (as such terms are
defined in the Rights Agreement),  (2) this Right Certificate is not being sold,
assigned or transferred by or on behalf of any such Acquiring Person,  Affiliate
or  Associate,  and (3)  after  due  inquiry  and to the best  knowledge  of the
undersigned,  the undersigned did not acquire the Rights evidenced by this Right
Certificate from any Person who is or was an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights Agreement).

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

                                     Notice

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

         In  the  event  the  certification  set  forth  above  in the  Form  of
Assignment  or the Form of  Election  to  Purchase,  as the case may be,  is not
completed,  the Corporation and the Rights Agent will deem the Beneficial  Owner
of the Rights  evidenced by this Right  Certificate to be an Acquiring Person or
an  Affiliate  or  Associate  thereof  (as such  terms are  defined in the Right
Agreement) and such Assignment or Election to Purchase will not be honored.

<PAGE>

                                    Exhibit C

                             WASHINGTON MUTUAL, INC.
                                1201 Third Avenue
                            Seattle, Washington 98101

                                     FORM OF
                          SUMMARY OF RIGHTS TO PURCHASE
                           SERIES RP PREFERRED SHARES

         The Board of Directors  (the "Board") of Washington  Mutual,  Inc. (the
"Corporation")  has  declared a dividend  distribution  of one  preferred  share
purchase  right (a  "Right")  for each  outstanding  share of Common  Stock (the
"Common Stock") of the Corporation.  The dividend is payable to the stockholders
of record on January 4, 2001 (the "Record Date"),  and with respect to shares of
Common Stock issued  thereafter until the  Distribution  Date (as defined below)
and, in certain  circumstances,  with  respect to shares of Common  Stock issued
after the  Distribution  Date.  Except as set forth below,  each Right,  when it
becomes  exercisable,  entitles  the  registered  holder  to  purchase  from the
Corporation  one  one-thousandth  (1/1000th)  of a share of Series RP  Preferred
Stock, $.01 par value per share (the "Preferred Stock"), of the Corporation at a
price of $200.00 per one one-thousandth (1/1000th) of a share of Preferred Stock
(the "Purchase Price"), subject to adjustment.  The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights  Agreement") between the
Corporation and Mellon Investor  Services,  L.L.C., as Rights Agent (the "Rights
Agent"), dated as of December 20, 2000.

         Initially, the Rights will be attached to all certificates representing
shares  of  Common  Stock  then  outstanding,   and  no  separate   certificates
representing the Rights ("Right  Certificates") will be distributed.  The Rights
will  separate  from the Common Stock upon the earliest to occur of (i) a person
or group of affiliated or associated persons having acquired,  without the prior
approval  of the  Corporation's  Board of  Directors,  beneficial  ownership  of
securities  which represent 15% or more of the voting power (the "Voting Power")
of the then outstanding voting securities of the Corporation (except pursuant to
a Permitted  Offer, as hereinafter  defined) or (ii) 10 days (or such later date
as the Board may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange  offer the  consummation  of which
would result in a person or group of affiliated or associated  persons  becoming
an Acquiring Person (as hereinafter defined) (the "Distribution Date"). A person
or group whose  acquisitions of shares of Common Stock cause a Distribution Date
pursuant to clause (i) above is an "Acquiring  Person," with certain  exceptions
as set forth in the Rights  Agreement.  The date that a person or group is first
publicly  announced  to have become such by the  Corporation  or such  Acquiring
Person  is the  "Shares  Acquisition  Date."  If any  security  holder  provides
evidence  satisfactory to the Board of beneficial  ownership of shares of Common
Stock  representing  15% or more of the Voting Power as of immediately  prior to
the first public  announcement  of the execution of the Rights  Agreement,  then
such security holder will not be deemed an Acquiring Person with respect to such
securities.

<PAGE>

         The Rights Agreement  provides that,  until the Distribution  Date, the
Rights will be transferred  with and only with the  associated  shares of Common
Stock.  Until the Distribution Date (or earlier  redemption or expiration of the
Rights),  new  Common  Stock  certificates  issued  after the  Record  Date upon
transfer  or new  issuance  of shares of Common  Stock  will  contain a notation
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier  redemption or expiration of the Rights),  the surrender for transfer of
any certificates  for shares of Common Stock  outstanding as of the Record Date,
even  without such  notation or a copy of this Summary of Rights being  attached
thereto,  will also  constitute the transfer of the Rights  associated  with the
shares of Common Stock represented by such  certificate.  As soon as practicable
following  the  Distribution  Date,  Right  Certificates  will be  mailed to the
holders of record of the shares of Common  Stock as of the Close of Business (as
defined in the Rights  Agreement) on the Distribution  Date (and to each initial
record  holder of certain  shares of Common Stock issued after the  Distribution
Date), and such separate Right Certificates alone will evidence the Rights.

         The Rights are not  exercisable  until the  Distribution  Date and will
expire at the close of business on January 4, 2011,  unless earlier  redeemed by
the Corporation as described below.

         In the event  that any  person  becomes  an  Acquiring  Person  (except
pursuant to a tender or exchange  offer which is for all  outstanding  shares of
Common Stock at a price and on terms which a majority of certain  members of the
Board  determines to be adequate and in the best  interests of the  Corporation,
its  stockholders and other relevant  constituencies,  other than such Acquiring
Person, its affiliates and associates (a "Permitted  Offer")),  each holder of a
Right will  thereafter  have the right (the  "Flip-In  Right") to receive,  upon
exercise, the number of shares of Common Stock (or, in certain circumstances, of
one  one-thousandths  (1/1000ths)  of  a  share  of  Preferred  Stock  or  other
securities  of the  Corporation)  having  a  value  (immediately  prior  to such
triggering  event)  equal  to  two  times  the  exercise  price  of  the  Right.
Notwithstanding  the foregoing,  following the occurrence of the event described
above,  all Rights that are, or (under  certain  circumstances  specified in the
Rights  Agreement)  were,  beneficially  owned by any  Acquiring  Person  or any
affiliate or associate  thereof will be null and void. The Board has the option,
at any time after any person  becomes an  Acquiring  Person,  to exchange all or
part of the  then-exercisable  Rights (excluding those that have become void, as
described in the immediately  preceding sentence) for shares of Common Stock, at
an exchange ratio determined by dividing the  then-applicable  Purchase Price by
the  then-current  market  price  per  share of Common  Stock as  determined  in
accordance with the Rights Agreement.  However, this option generally terminates
if any person becomes the beneficial owner of shares representing 50% or more of
the Voting Power.

         In the event that, at any time following the Shares  Acquisition  Date,
(i) the  Corporation  is  acquired  in a merger  or other  business  combination
transaction  in which the  holders  of all of the  outstanding  shares of Common
Stock  immediately  prior to the  consummation  of the  transaction  are not the
holders of all of the surviving  corporation's  voting power,  or (ii) more than
50% of the  Corporation's  assets or earning  power is sold or  transferred,  in
either case with or to (x) an  Acquiring  Person or any  affiliate  or associate
thereof or (y) any other  person in which such  Acquiring  Person,  affiliate or
associate  has an interest or any person  acting on behalf of or in concert with

                                       2
<PAGE>

such Acquiring Person,  affiliate or associate,  or (z) if, in such transaction,
all holders of shares of Common Stock are not treated  alike,  any other person,
then each holder of a Right (except Rights which  previously have been voided as
set forth  above) shall  thereafter  have the right (the  "Flip-Over  Right") to
receive,  upon exercise,  common shares of the acquiring company (or, in certain
circumstances, its parent), having a value equal to two times the exercise price
of the Right.  The holder of a Right will continue to have the  Flip-Over  Right
whether or not such holder exercises or surrenders the Flip-In Right.

         The  Purchase  Price  payable,  and the  number of shares of  Preferred
Stock, shares of Common Stock or other securities issuable, upon exercise of the
Rights are subject to  adjustment  from time to time to prevent  dilution (i) in
the  event  of  a  stock   dividend  on,  or  a   subdivision,   combination  or
reclassification  of,  the  Preferred  Stock,  (ii) upon the grant to holders of
shares of the Preferred  Stock of certain rights or warrants to subscribe for or
purchase  Preferred Stock at a price, or securities  convertible  into Preferred
Stock with a conversion  price,  less than the then current  market price of the
Preferred  Stock or (iii)  upon the  distribution  to  holders  of shares 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).

         The number of outstanding Rights and the number of one  one-thousandths
(1/1000ths)  of a share of Preferred  Stock issuable upon exercise of each Right
are also subject to adjustment in the event of a stock split of the Common Stock
or a stock dividend on the Common Stock payable in Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring,  in any such case,
prior to the Distribution Date.

         Preferred  Stock  purchasable  upon  exercise of the Rights will not be
redeemable.  Each  share  of  Preferred  Stock  will be  entitled  to a  minimum
preferential quarterly dividend payment of $1.00 per share but, if greater, will
be  entitled to an  aggregate  dividend  per share of 1,000  times the  dividend
declared per share of Common Stock. In the event of liquidation,  the holders of
shares  of the  Preferred  Stock  will be  entitled  to a  minimum  preferential
liquidation  payment per share in an amount  equal to the greater of 1,000 times
$200.00 or 1,000 times the payment made per share of Common Stock plus an amount
equal to accrued and unpaid dividends and distributions thereon,  whether or not
declared, to the date of such payment (the "Series RP Liquidation  Preference");
thereafter,  and after the  holders  of shares  of the  Common  Stock  receive a
liquidation  payment of an amount equal to the quotient obtained by dividing the
Series RP Liquidation  Preference by 1,000 (subject to certain  adjustments  for
stock splits, stock dividends and  recapitalizations  with respect to the Common
Stock),  the  holders of shares of the  Preferred  Stock and the  holders of the
Common  Stock  will  share the  remaining  assets in the ratio of 1,000 to 1 (as
adjusted)  for  each  share  of  Preferred  Stock  and  Common  Stock  so  held,
respectively.  Finally,  in the  event  of any  merger,  consolidation  or other
transaction  in which  shares  of  Common  Stock are  exchanged,  each  share of
Preferred  Stock will be entitled to receive 1,000 times the amount received per
share of Common  Stock.  These rights are  protected  by customary  antidilution
provisions.  In the event that the amount of accrued and unpaid dividends on the
Preferred  Stock is  equivalent  to six full  quarterly  dividends or more,  the
holders of shares of the  Preferred  Stock  shall  have the  right,  voting as a
class,  to elect two  directors  in  addition  to the  directors  elected by the
holders of shares of the Common  Stock  until all  cumulative  dividends  on the

                                       3
<PAGE>

Preferred  Stock  have  been  paid or set apart  for  payment  through  the last
quarterly dividend payment date. No fractional shares of Preferred Stock will be
issued (other than fractions which are one one-thousandth (1/1000th) or integral
multiples of one one-thousandth  (1/1000th) of a share of Preferred Stock, which
may, at the election of the  Corporation,  be evidenced by depositary  receipts)
and in lieu  thereof,  an  adjustment  in cash will be made  based on the market
price  of the  Preferred  Stock  on the last  trading  day  prior to the date of
exercise.

         With certain  exceptions,  no adjustment in the Purchase  Price will be
required until  cumulative  adjustments  require an adjustment of at least 1% in
such Purchase Price.

         At any time prior to the  earlier to occur of (i) a person  becoming an
Acquiring  Person or (ii) the expiration of the Rights,  and under certain other
circumstances,  the Corporation may redeem the Rights in whole, but not in part,
at a price (payable in cash or, at the Corporation's  election, in Common Stock)
of $.001 per Right (the "Redemption Price"), which redemption shall be effective
upon the action of the Board.  Additionally,  following  the Shares  Acquisition
Date, the Corporation may redeem the then  outstanding  Rights in whole, but not
in part, at the Redemption Price, provided that such redemption is in connection
with  a  merger  or  other  business   combination   transaction  or  series  of
transactions  involving the Corporation in which all holders of shares of Common
Stock are treated alike but not involving an Acquiring  Person or its affiliates
or associates.

         Other  than  those  provisions  relating  to  the  rights,  duties  and
obligations of the Rights Agent,  all of the provisions of the Rights  Agreement
may be  amended  by the  Board  of  Directors  of the  Corporation  prior to the
Distribution Date, except that the affirmative vote of the holders of a majority
of the then  outstanding  Rights  (excluding  Rights  which have  become void in
accordance  with the Rights  Agreement)  will be required  (i) to  increase  the
Purchase  Price,  to reduce the price at which the Rights may be redeemed and/or
to amend,  in a manner  adverse to the  interests of the holders of Rights,  the
exchange  ratio of  rights  for  shares of Common  Stock  and (ii)  following  a
Distribution  Date, to supplement or amend any provision of the Rights Agreement
or the Rights in any other respect.

         Until a Right is exercised,  the holder thereof,  as such, will have no
rights as a stockholder of the Corporation,  including,  without limitation, the
right to vote or to receive dividends. While the distribution of the Rights will
not be taxable to stockholders of the Corporation,  stockholders may,  depending
upon the  circumstances,  recognize  taxable  income  should the  Rights  become
exercisable or upon the occurrence of certain events thereafter.

         A copy of the Rights  Agreement has been filed with the  Securities and
Exchange  Commission  as an Exhibit to a  Registration  Statement on Form 8-A. A
copy of the Rights  Agreement is available free of charge from the  Corporation.
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 hereby
incorporated herein by reference.

                                       4

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