AMENDMENT NO. 1 to the RIGHTS AGREEMENT Between INTERDIGITAL COMMUNICATIONS CORPORATION and AMERICAN STOCK TRANSFER AND TRUST COMPANY dated as of DECEMBER 31, 1996

                                                                     Exhibit 4.2

                                 AMENDMENT NO. 1
                                     to the
                                RIGHTS AGREEMENT
                                     Between
                     INTERDIGITAL COMMUNICATIONS CORPORATION
                                       and
                    AMERICAN STOCK TRANSFER AND TRUST COMPANY
                                   dated as of
                                DECEMBER 31, 1996


THIS AMENDMENT NO. 1, dated May 6, 1997,  to the RIGHTS AGREEMENT between
INTERDIGITAL COMMUNICATIONS CORPORATION and AMERICAN STOCK
TRANSFER AND TRUST COMPANY dated as of  DECEMBER 31, 1996

WHEREAS, InterDigital Communications Corporation ("InterDigital") and American
Stock Transfer and Trust Company ("ASTT") entered into a Rights Agreement, dated
as of December 31, 1996, (the "Agreement") dealing with, among other things, the
voting rights of the holders of InterDigital Common Stock; and

WHEREAS, InterDigital has entered into an agreement with Heartland Advisors
dated May 5, 1997 (the "Letter Agreement") under which the Company, in exchange
for other consideration, has agreed to permit Heartland not to become and
"Acquiring Person", as defined under the Agreement, subject to the terms and
conditions of the Agreement and the Letter Agreement; and

WHEREAS, to implement the requirements of the Letter Agreement, InterDigital and
ASTT, pursuant to Section 26 of the Agreement, have agreed to amend the
Agreement as set forth herein.

NOW THEREFORE, the parties, intending to be legally bound, agree as follows:

1. The definition of "Acquiring Person" set forth in Section 1, paragraph (a),
is amended by adding a new clause at the end of the definition reading as
follows:

     ;provided, however, that Heartland Advisors shall not be an Acquiring
     Person unless and until Heartland Advisors (i) is the Beneficial Owner of
     more than 16% of the shares of Common Stock then outstanding, or (ii) is
     the Beneficial Owner of 15% or more of the shares of Common Stock then
     outstanding and Heartland is not permitted to file a Schedule 13G, in lieu
     of Schedule 13D, pursuant to the Securities Exchange Act of 1934 and the
     rules and regulations promulgated thereunder.

2. All other terms conditions remained unaltered and in full force and effect.





Amendment No. 1 to the Rights Agreement
 dated December 31, 1996
Page 2


IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be duly
executed, all as of the date first written above.


ATTEST:                                 INTERDIGITAL COMMUNICATIONS
                                         CORPORATION


BY:   /s/ Xxxx Xxx Xxxxxxxx             BY:   /s/ Xxxxxxx X. Xxxxx
      --------------------------              ---------------------------
          Xxxx Xxx Xxxxxxxxx                      Xxxxxxx X. Xxxxx
          Assistant Secretary                     President



ATTEST:                                 AMERICAN STOCK TRANSFER AND TRUST
                                           COMPANY


BY:   /s/  Xxxxx Xxxxxx                 BY:   /s/  Xxxxxxx X. Xxxxxx
      --------------------------              ---------------------------
           Xxxxx Xxxxxx                            Xxxxxxx X. Xxxxxx
           Assistant Secretary                     Senior Vice President and
                                                    General Counsel