**Exhibit 4.2**

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**REGISTRATION RIGHTSAGREEMENT**

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**THISREGISTRATION RIGHTS AGREEMENT**(this “Agreement”), dated as of March 11, 2008 is entered intobetween PPT Vision, Inc., a Minnesota corporation (the “Company”) and theP. R. Peterson Co. Keogh Plan (“Investor”).

 

**WHEREAS**, pursuant to a Warrant issued by the Companyto the Investor today (the “Warrant”) the Investor is entitled to acquire fromthe Company fully paid and nonassessable shares of the Company’s common stock,$.10 par value (“Common Stock”); and

 

**WHEREAS**, the Company and the Investor believe it isin each of their best interest to provide for registration and other rightswith respect to the shares of Common Stock to be issued under the Warrant.

 

**NOWTHEREFORE**, theparties agree as follows:

 

# 1.                                                                                       CERTAIN DEFINITIONS.  Asused in this Agreement, the following terms have the following respectivemeanings:

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*“Business Day”*means any day other than a Saturday, Sundayor other day on which commercial banks in the Sate of Minnesota are authorizedor required by law or executive order to close.

 

*“Exchange Act”* means the Exchange Act of 1934, as amended,and the rules and regulations adopted under that Act.

 

“*Form S-3*”means such form of Registration Statement as in effect on the date hereof orany Registration Statement subsequently adopted by the SEC that permitsinclusion or incorporation of substantial information by reference to otherdocuments filed by the Company with the SEC.

 

“*Holders”*means the Investor and any other person to whom the Warrant or the RegistrableSecurities and the registration rights granted hereunder have been dulyassigned or transferred by the Investor in accordance with this Agreement andthe provisions of the Warrant, respectively.

 

“R*egister*,”“*registration*” and “*registered*”refer to a registration effected under the Securities Act by preparing andfiling a Registration Statement in compliance with the Securities Act, and thedeclaration or ordering of effectiveness of the Registration Statement by theCommission.

 

“*RegistrableSecurities*” means:

 

(i)                                                           shares of Common Stock issued or issuable toHolders upon proper exercise of the Warrant;

 

(ii)                                                        all shares of Common Stock to be issued as(or issuable upon the conversion or exercise of any warrant, right or othersecurity that is issued as) a dividend or other distribution with respect to,or in exchange for or in replacement of the shares referenced in clauses (i).

 

Registrable Securities will cease to be RegistrableSecurities when

 

(i)                                   a Registration Statement covering theRegistrable Securities has been declared effective under the Securities Act bythe Commission and the Registrable Securities have been disposed of pursuant tothe Registration Statement,

 

(ii)                                all of the Registrable Securities owned by aHolder may be sold in a period of three months, in the opinion of counselsatisfactory to the Company, without any limitation as to volume pursuant to Rule 144,

 

(iii)                             the Registrable Securities are proposed to besold or distributed by a person not entitled to the registration rights grantedby this Agreement,

 

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(iv)                            they have been transferred to a person in aprivate transaction to whom the rights under this Agreement have not beenassigned,

 

(v)                               they have been transferred in violation ofthe terms of the Warrant or

 

(vi)                            they have previously been registered or havebeen sold to the public either pursuant to a Registration Statement or Rule 144.

 

Wherever reference is made in this Agreement to arequest or consent of Holders of a certain percentage of Registrable Shares,the determination of that percentage will include shares of Common Stockissuable upon exercise of the Warrant, even if the conversion or exercise hasnot yet been effected.

 

“*RegistrationExpenses*” means all expenses incurred by the Company in complyingwith this Agreement, including, without limitation, all registration and filingfees, exchange listing fees, printing expenses, fees and disbursements ofcounsel for the Company, state blue sky fees and expenses, and the expense ofany special audits incident to or required by any registration, butspecifically exclude any Selling Holder Expense.

 

“*Registration Statement*” means a registration statement filedpursuant to the Securities Act.

 

“*Rule 144*”means Rule 144 promulgated under the Securities Act, or any successorprovision then in effect.

 

“*SEC*”or “*Commission*” means the U.S. Securitiesand Exchange Commission.

 

*“Securities Act”* means the Securities Act of 1933, asamended.

 

“*SellingHolder Expenses*” means all discounts, commissions or other amountspayable to underwriters in connection with a registration that are to be paidby the Holders of Registrable Securities included in a Registration Statementand all fees and expenses for counsel or other advisors for the Holders ofRegistrable Securities included in a Registration Statement.

 

# 2.                                                                                       REGISTRATIONRIGHTS.

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## a.                                                               DemandRegistration.

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### i.                       DemandRights.  The Holders holding amajority of the Registrable Securities held by all of the Holders may at anytime make a written request (the “Demand Notice”) that the Company register,and the Company must register (other than pursuant to a Registration Statementon Form S-4 or S-8 or any successor thereto) (a “Demand Registration”),the number of Registrable Securities stated in such request if the RegistrableSecurities have an anticipated aggregate public offering price (net ofunderwriting discounts and commissions) of One Hundred Thousand Dollars($100,000) (a “Demand Registration Statement”). The Company must use its reasonable best efforts to cause any DemandRegistration Statement to be filed with the Commission not later than 60 daysafter it receives a request under this Section.

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### ii.                    Other Shareholders.  Anyother person entitled to participate in a Demand Registration Statement (“OtherShareholders”) and the Company will be permitted to register equity securitiesof the Company in any Demand Registration Statement or to participate in theoffering, but only as provided in this subparagraph, by requesting thatsecurities of the same class as the Registrable Securities be included in theDemand Registration Statement for sale in the offering on the following termsand conditions:

 

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#### a)              Each OtherShareholder must give written notice of election to the Holders within 15 daysof the date the Demand Notice was given to the Company, such notice to specifythe number of shares proposed to be sold by each Other Shareholder in theoffering;

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#### b)             the Company must give written notice ofelection to the Holders within 15 days of the date the Demand Notice was givento the Company, such notice to specify the number of shares proposed to be soldby the Company in the offering (the Other Shareholder and Company shares are “OtherShares”);

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#### c)              Each Other Shareholder and the Company mustagree to sell such Other Shares on the same basis provided in the underwritingarrangements approved by the Holders and to timely complete and execute allquestionnaires, powers of attorney, indemnities, hold-back agreements,underwriting agreements and other documents required under the terms of suchunderwriting arrangements or by the Commission or by any state securitiesregulatory body;

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#### d)             Notwithstanding any other provision of thisAgreement, if the managing underwriter(s) determine(s) in good faiththat marketing factors require a limitation of the number of shares to beunderwritten, then the managing underwriter(s) may exclude Other Sharesfrom the registration and the underwriting, and the number of Other Shares thatmay be included in the registration and the underwriting will be allocated prorata among each Other Shareholder and the Company based upon the respectivenumber of Other Shares sought to be included in the offering; and

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#### e)              If any Other Shareholder or the Companydesire to withdraw their Other Shares from the Demand Registration Statement,they may only do so during the time period and on the terms to be determined bythe Holders, the Company and the underwriters.

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### iii.                 Limits.  Notwithstanding anythingcontained in this Section 2.1 to the contrary, the Company will not beobligated to effect more than one Demand Registration for the Holders duringthe term of this Agreement.  In addition,notwithstanding anything contained in this Section 2.1 to the contrary,the Company may delay the Demand Registration of the Registrable Securities ifupon receipt of such Demand Notice if

 

#### a)              the Company notifies the Holders that it iscontemplating filing a Registration Statement within 90 days of the demand(which notice will not affect the Holders’ other rights hereunder, includingwithout limitation the Holders’ rights under Section 2.2 below) or

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#### b)             the Company notifies Holders that in the goodfaith judgment of the Company a material event has occurred that has not beenpublicly disclosed and if disclosed would have a material adverse effect on theCompany.

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In the case of clause (i) of this paragraph, the Company will useits best efforts, as soon as practical, upon the first to occur of theabandonment of such contemplated Registration Statement or the expiration ofthe 90-day period, to file the Demand Registration Statement for 

 

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the RegistrableSecurities to which a Demand Notice relates, unless such Demand Notice iswithdrawn.  In the case of clause (ii) ofthis paragraph, the Company may not delay the filing of the Demand RegistrationStatement for more than 90 days from the time of the demand unless such DemandNotice is withdrawn. The Company may not exercise the rights of postponement setforth above more than once in any twelve month period.  If there is a postponement under eitherclause (i) or (ii) above, the Demand Notice may be withdrawn bynotice to the Company by the Holders of a majority of the RegistrableSecurities.  In this case, no demand willhave been made for the purposes of this Section 2.1.

 

### iv.                Expenses.  The Company will pay allRegistration Expenses incurred in connection with a Demand Registration.

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### v.                   Other Demand Rights.  Eachof the Holders may offer such Holder’s Registrable Securities under any DemandRegistration pursuant to this Section 2.1(e).  Within five days after the receipt of arequest for a Demand Registration, the Company will (i) give writtennotice thereof to all of the Holders (other than Holders that have requested aDemand Registration under Section 2.1(a)) and (ii) include in suchregistration all of the Registrable Securities held by such Holders from whomthe Company has received a written request within ten  days of the receipt by such Holders of theCompany’s notice referred to in clause (i) above.  In the request referred to in clause (ii) above,the Holders must specify the number of Registrable Securities proposed to beregistered.  The failure of any Holder torespond within such 10-day period referred to in clause (ii) above will bedeemed to be a automatic waiver of such Demand Registration.  Any Holder may waive its rights under Section 2.1with respect to such Demand Registration. Any Holder may waive its rights under this Section 2.1(e) priorto the expiration of the 10-day period by giving written notice to the Company,with a copy to the other Holders.  If aHolder sends the Company a written request for inclusion of part of all of theHolder’s Registrable Securities in a registration, the Holder will not beentitled to withdraw or revoke the request without the prior written consent ofthe Company in its sole discretion.

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## b.                                                              Piggyback Registrations.

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### i.                       Company Registration.  TheCompany will promptly notify Holders in writing at least twenty days prior tofiling any Registration Statement for purposes of effecting a public offeringof securities of the Company (excluding any Registration Statements on Form S-8or on Form S-4 or any Registration Statement in connection with a publicoffering of any security that is not of the same class as the RegistrableSecurities) (a “Piggyback Registration”), and the Company will afford eachHolder an opportunity to register on such Registration Statement (a “PiggybackRegistration Statement”) all or any part of the Registrable Securities of theHolder.  Each Holder desiring to includein the Piggyback Registration Statement all or any part of the RegistrableSecurities held by such Holder must, within ten days after receipt of thenotice from the Company, notify the Company in writing and inform the Companyof the number of Registrable Securities the Holder wishes to include in thePiggyback Registration Statement.  If aHolder decides not to include all of its Registrable Securities in thePiggyback Registration Statement, the Holder will nevertheless continue to havethe right to include any Registrable Securities in any subsequent PiggybackRegistration, all upon the terms and conditions of this Agreement.  The Company will not be required to includeany Registrable Securities in more than two Piggyback Registration during theterm of this Agreement.

 

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### ii.                    Underwriting.  If aPiggyback Registration is an underwritten offering, then the Company will soadvise the Holders of Registrable Securities. In this event, the right of any Holder’s Registrable Securities to beincluded in a Piggyback Registration will be conditioned upon the Holder’sparticipation in the offering in the same terms and conditions as theSecurities for the account of the Company or other shareholders, as the casemay be, and the inclusion of the Holder’s Registrable Securities in theunderwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities throughsuch underwriting will enter into an underwriting agreement in customary formwith the managing underwriter or underwriters selected for theunderwriting.  Notwithstanding any otherprovision of this Agreement, if the managing underwriter(s) determine(s) ingood faith that marketing factors require a limitation of the number of sharesto be underwritten, then the managing underwriter(s) may exclude shares(including Registrable Securities) from the Piggyback Registration and theunderwriting, and the number of shares that may be included in the PiggyRegistration and the Piggyback Registration will be allocated, first, tothe Company, and second, to each of the Holders requesting inclusion oftheir Registrable Securities in such Registration Statement on a pro rata basisbased on the total number of Registrable Securities then held by each suchHolder and third, any other securities requested to be included in suchoffering by any other shareholders of the Company.  If any Holder disapproves of the terms of anyunderwriting, the Holder may elect to withdraw form it by written notice to theCompany and the underwriter, delivered at least ten Business Days prior to theeffective date of the Registration Statement. Any Registrable Securities excluded or withdrawn from such underwritingwill be excluded and withdrawn from the Piggyback Registration.  For any Holder that is a partnership orcorporation, the partners, retired partners and shareholders of such Holder, orthe estates and family members of any such partners and retired partners andany trusts for the benefit of any of the foregoing persons will be deemed to bea single “Holder,” and any pro rata reduction with respect to such “Holder”will be based upon the aggregate amount of shares carrying registration rightsowned by all entities and individuals included in such “Holder,” as defined inthis sentence.

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### iii.                 Expenses.  The Company will pay allRegistration Expenses incurred in connection with a Piggyback Registration.

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## c.                                                               Form S-3Registrations.  In case the Companyreceives from the Holders of a majority of the Registrable Securities a writtenrequest that the Company effect a registration on Form S-3 with respect toall or a part of the Registrable Securities owned by such Holders, the Companymust:

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### i.                       promptlygive written notice of the proposed registration to all other eligible Holdersof Registrable Securities; and

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### ii.                    assoon as practicable, file the Registration Statement and use commerciallyreasonable efforts to have the Registration Statement declared effective aswould permit or facilitate the sale and distribution of all or such portion ofsuch Holders’ Registrable Securities as are specified in such request, togetherwith all or such portion of the Registrable Securities of any other eligibleHolders joining in such request as are specified in a written request givenwithin fifteen days after receipt of such written notice from the Company.  The Company will not be obligated to effectany such registration, pursuant to this Section 2.3:

 

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#### a)              if Form S-3 isnot available for such offering by the Holders;

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#### b)             if the Companyfurnishes to the Holders a certificate signed by the Chief Executive Officer orChief Financial Officer of the Company stating that, in the good faith judgmentof the Board of Directors of the Company, it would be seriously detrimental tothe Company and its shareholders for such Form S-3 registration to beeffected at such time, in which event the Company will have the right to deferthe filing of the Form S-3 Registration Statement for a period of not morethan sixty days after receipt of the request of the Holders under this Section 2.3provided.  The Company may not utilizethis right more than once in any twelve month period, and may register anyother of its shares during such sixty day period;

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#### c)              if the Company has,within the nine month period preceding the date of the request, alreadyeffected one registration on Form S-3 for the Holders pursuant to this Section 2.3;

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#### d)             if the Company hasalready effected two registrations on Form S-3 for the Holders pursuant tothis Section 2.3;

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#### e)              if the Holders,together with the holders of any other securities of the Company entitled toinclusion in such registration, propose to sell Registrable Securities and suchother securities (if any) at an aggregate price to the public (net of anyunderwriters’ discounts or commissions) of less than $100,000;

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#### f)                if the Holderswould not be entitled to request a Demand Registration under Section 2.1.

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### iii.                 Subjectto the foregoing, the Company must file a Registration Statement covering theRegistrable Securities as soon as practicable after receipt of the request ofthe Holders.

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### iv.                Eachregistration demanded pursuant to this Section 2.3 will be deemed to be aDemand Registration for the purposes of Section 2.1(c).

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### v.                   Expenses.  The Company will pay all RegistrationExpenses incurred in connection with a registration pursuant to this Section 2.3.

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## d.                                                              Obligationsof the Company.  Whenever required to effect the registration of anyRegistrable Securities under this Agreement, the Company will, as expeditiouslyas reasonably possible:

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### i.                       Prepareand file with the SEC a Registration Statement, on such form as is then availableto the Company in connection with such registration, with respect to theRegistrable Securities and use commercially reasonable, diligent efforts tocause the Registration Statement to become effective, and, upon the request ofthe Holders of a majority of the Registrable Securities registered thereunder,keep the Registration Statement effective for up to ninety days, or if earlier,then until the Holders have completed the distribution related thereto. Thisninety day period will be extended for a period of time equal to the period theHolders refrain from 

 

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### selling anysecurities included in such registration at the request of an underwriter ofCommon Stock (or other securities) of the Company and in the case of anyregistration of Registrable Securities on Form S-3 that are intended to beoffered on a continuous or delayed basis, the ninety day period will beextended, if necessary, to keep the Registration Statement effective until allsuch Registrable Securities are sold, provided that Rule 415, or anysuccessor rule under the Securities Act, permits an offering on acontinuous or delayed basis, and provided further that applicable rules underthe Securities Act governing the obligation to file a post-effective amendmentpermit, in lieu of filing a post-effective amendment that (A) includes anyprospectus required by Section 10(a)(3) of the Securities Act or (B) reflectsfacts or events representing a material or fundamental change in theinformation set forth in the Registration Statement, the incorporation byreference of information required to be included in (A) or (B) aboveto be contained in periodic reports filed pursuant to section 13 or 15(d) ofthe Exchange Act in the Registration Statement.

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### ii.                    Prepare and file with the SEC such amendmentsand supplements to the Registration Statement and the prospectus used inconnection with the Registration Statement as may be necessary to comply withthe provisions of the Securities Act with respect to the disposition of allsecurities covered by such Registration Statement.

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### iii.                 Furnish to the Holders such number of copiesof a prospectus, including a preliminary prospectus, in conformity with therequirements of the Securities Act, and other documents as they may reasonablyrequest in order to facilitate the disposition of the Registrable Securitiesowned by them that are included in the registration.

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### iv.                Use reasonable, diligent efforts to registerand qualify the securities covered by such Registration Statement under suchother securities or blue sky laws of such jurisdictions as will be reasonablyrequested by the Holders,.  provided thatthe Company will not be required in connection therewith or as a conditionthereto to qualify to do business or to file a general consent to service ofprocess in any such states or jurisdictions.

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### v.                   In the event of any underwritten publicoffering, enter into and perform its obligations under an underwritingagreement, in usual and customary form, with the managing underwriter(s) ofsuch offering.  Each Holder participatingin the underwriting must also enter into and perform its obligations under suchan agreement.

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### vi.                Notify each Holder of Registrable Securitiescovered by the Registration Statement at any time when a prospectus relatingthereto is required to be delivered under the Securities Act of the occurrenceof any event as a result of which the required to be included in suchRegistration Statement, as then in effect, includes an untrue statement of a materialfact or omits to state a material fact required to be stated therein ornecessary to make the statements contained therein not misleading in the lightof the circumstances then existing and the Company must promptly prepare asupplement or amendment to such prospectus and furnish to each seller ofRegistrable Securities a reasonable number of copies of such supplement to oran amendment of such prospectus as may be necessary so that, after delivery tothe purchasers of such Registrable Securities, such prospectus will not containan untrue statement of a material fact or omit to state any material factrequired to be stated therein or necessary to make the statements therein, inlight of the circumstances under which they were made, not misleading.

 

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## e.                                                               Furnish Information.  It will be a condition precedent tothe obligations of the Company to take any action pursuant to Sections 2.1, 2.2and 2.3 hereof that the selling Holders will furnish to the Company informationregarding themselves, the Registrable Securities held by them, and the intendedmethod of disposition of the securities as will be required to timely effectthe registration of their Registrable Securities.

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## f.                                                                 Delay of Registration.  No Holder will have any right toobtain or seek an injunction restraining or otherwise delaying any suchregistration as the result of any controversy that might arise with respect tothe interpretation or implementation of this Agreement.

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## g.                                                              Notice to Discontinue.  EachHolder agrees that, upon receipt of any notice from the Company of thehappening of any event of the kind described in Section 2.4(f) theHolder will forthwith discontinue disposition of Registrable Securitiespursuant to the Registration Statement covering such Registrable Securitiesuntil the Holder’s receipt of the copies of the supplemented or amendedprospectus contemplated by Section 2.4(f) and, if so directed by theCompany, the Holder will deliver to the Company (at the Company’s expense) allcopies, other than permanent file copies then in the Holder’s possession,possession, of the prospectus covering such Registrable Securities that iscurrent at the time of receipt of the notice.

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## h.                                                              Indemnification.  In the event any Registrable Securitiesare included in a Registration Statement under Sections 2.1, 2.2 or 2.3 hereof:

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### i.                       By the Company.  Tothe extent permitted by law, the Company will indemnify and hold harmless eachHolder, the partners, officers and directors of each Holder, any underwriter(as defined in the Securities Act) for such Holder and each person, if any, whocontrols (within the meaning of the Securities Act) the Holder against anylosses, claims, damages, or liabilities (joint or several) under the SecuritiesAct, the Exchange Act or other federal or state law, insofar as such losses,claims, damages, or liabilities (or actions in respect thereof) arise out of orare based upon any of the following statements, omissions or violations (each a“Violation”):

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#### a)              any untrue statement or alleged untruestatement of a material fact contained in such Registration Statement,including any preliminary prospectus or final prospectus contained therein orany amendments or supplements thereto;

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#### b)             the omission or alleged omission to statetherein a material fact required to be stated therein, or necessary to make thestatements therein not misleading under the circumstances such statement weremade; or

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#### c)              any violation or alleged violation by theCompany of the Securities Act, the Exchange Act, any federal or statesecurities law or any rule or regulation promulgated under the SecuritiesAct, the Exchange Act or any federal or state securities law in connection withthe offering covered by such Registration Statement;

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and the Company will reimburse each such Holder, partner, officer ordirector, underwriter or controlling person for any legal or other expensesreasonably incurred by them, as incurred, in connection with investigating ordefending any such loss, claim, damage, liability or action; provided however,that the indemnity agreement contained in this Section 2.8(a) willnot 

 

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apply to amountspaid in settlement of any such loss, claim, damage, liability or action if thesettlement is effected without the consent of the Company, nor will the Companybe liable in any such case for any loss, claim, damage, liability or action tothe extent that it arises out of or is based upon a Violation that occurs inreliance upon and in conformity with written information furnished expresslyfor use in connection with such registration by such Holder, partner, officer,director or controlling person of such Holder.

 

### ii.                    By Selling Holders.  Tothe extent permitted by law, each selling Holder whose Registrable Securitiesare included in a Registration Statement will indemnify and hold harmless theCompany, each of its directors, each of its officers who have signed theRegistration Statement, each person, if any, who controls the Company within themeaning of the Securities Act, and each underwriter, if any, and each person,if any, who controls any underwriter within the meaning of the Securities Actor the Exchange Act, and any other Holder selling securities under suchRegistration Statement or any of such other Holder’s partners, directors orofficers or any person who controls such Holder within the meaning of theSecurities Act or the Exchange Act, against any losses, claims, damages orliabilities (joint or several) under the Securities Act, the Exchange Act orother federal or state law, insofar as such losses, claims, damages orliabilities (or actions in respect thereto) arise out of or are based upon anyViolation, in each case to the extent (and only to the extent) that suchViolation occurs in reliance upon and in conformity with written informationfurnished by such Holder expressly for use in connection with suchregistration; and each such Holder will reimburse any legal or other expensesreasonably incurred by the Company or any such director, officer, controllingperson, underwriter or other Holder, or partner, officer, director orcontrolling person of such other Holder in connection with investigating ordefending any such loss, claim, damage, liability or action; provided, however,that the indemnity agreement contained in this Section 2.8(b) willnot apply to amounts paid in settlement of any such loss, claim, damage,liability or action if such settlement is effected without the consent of theHolder, which consent will not be unreasonably withheld; and provided further,that the total amounts payable in indemnity by a Holder under this Section 2.8(b) inrespect of any violation will not exceed the proceeds received by such Holderin the Registration Statement out of which such Violation arises unless theViolation is a result of fraud on the part of such Holder.

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### iii.                 Notice.  Promptly after receipt by anindemnified party under this Section 2.8 of notice of the commencement ofany action (including any governmental action), the indemnified party will, ifa claim in respect thereof is to be made against any indemnifying party underthis Section 2.8, deliver to the indemnifying party a written notice ofthe commencement thereof, and the indemnifying party will have the right toparticipate in, and, to the extent the indemnifying party so desires, jointlywith any other indemnifying party similarly noticed, to assume the defensethereof with counsel mutually satisfactory to the parties. An indemnified partywill have the right, however, to retain its own counsel, with the fees andexpenses to be paid by the indemnifying party (or, if there is more than oneindemnified party, the indemnifying party will pay the fees and expenses of onecounsel for any and all indemnified parties, to be mutually agreed upon by suchindemnified parties), if representation of the indemnified party by the counselretained by the indemnifying party would be inappropriate due to actual orpotential differing interests between such indemnified party and any otherparty represented by such counsel in the proceeding.  The failure to deliver written notice to theindemnifying party within a reasonable time of the commencement of any suchaction, if materially prejudicial to its ability 

 

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### to defend such action, will relieve such indemnifying party of anyliability to the indemnified party under this Section 2.8, but theomission so to deliver written notice to the indemnifying party will notrelieve it of any liability that it may have to any indemnified party otherwisethan under this Section 2.8.

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### iv.                Defect Eliminated in Final Prospectus.  Theforegoing indemnity agreements are subject to the condition that, insofar asthey relate to any Violation made in a preliminary prospectus but eliminated orremedied in the amended prospectus on file with the SEC at the time theRegistration Statement in question becomes effective or the amended prospectusis filed with the SEC pursuant to SEC Rule 424(b), such indemnity agreementwill not inure to the benefit of any person if a copy of such final prospectuswas furnished to the indemnified party and was not furnished to the personasserting the loss, liability, claim, or damage at or prior to the time suchaction is required by the Securities Act.

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### v.                   Contribution.  Inorder to provide for just and equitable contribution to joint liability underthe Securities Act in any case in which either (i) any Holder exercisingrights under this Agreement, or any controlling person of any such Holder,makes a claim for indemnification pursuant to this Section 2.7 but it isjudicially determined (by the entry of a final judgment or decree by a court ofcompetent jurisdiction and the expiration of time to appeal or the denial ofthe last right of appeal) that such indemnification may not be enforced in suchcase notwithstanding the fact that this Section 2.8 provides forindemnification in such case, or (ii) contribution under the Securities Act maybe required on the part of any such selling Holder or any such controllingperson in circumstances for which indemnification is provided under this Section 2.8;then, and in each such case, the Company and such Holder will contribute to theaggregate losses, claims, damages or liabilities to which they may be subject(after contribution from others) in such proportion so that such Holder isresponsible for the portion represented by the percentage that the publicoffering price of its Registrable Securities offered by and sold under theRegistration Statement bears to the public offering price of all securitiesoffered by and sold under such Registration Statement, and the Company andother selling Holders are responsible for the remaining portion; provided,however, that, in any such case, (A) no such Holder will be required tocontribute any amount in excess of the public offering price of all suchRegistrable Securities offered and sold by such Holder pursuant to suchRegistration Statement; and (B) no person or entity guilty of fraudulentmisrepresentation (within the meaning of Section 1.1(f) of theSecurities Act) will be entitled to contribution from any person or entity whowas not guilty of such fraudulent misrepresentation.

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### vi.                Survival.  The obligations of the Companyand Holders under this Section 2.8 will survive the completion of anyoffering of Registrable Securities in a Registration Statement, and otherwise.

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## i.                                                                  Rule 144 Reporting.  With a view to making available thebenefits of certain rules and regulations of the Commission that may atany time permit the sale of the Registrable Securities to the public withoutregistration, the Company agrees to use reasonable efforts to:

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### i.                       to make and keep public informationavailable, as those terms are understood and defined in Rule 144 at all times;

 

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### ii.                    to file with the Commission in a timelymanner all reports and other documents required of the Company under theExchange Act; and

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### iii.                 so long as a Holder owns any RegistrableSecurities, to furnish to the Holders forthwith upon request a writtenstatement by the Company as to its compliance with the reporting requirementsof Rule 144 and of the Securities Act and the Exchange Act, a copy of themost recent annual or quarterly report of the Company, and such other reportsand documents of the Company as a Holder may reasonably request in availingitself of any rule or regulation of the Commission allowing a Holder tosell any such securities without registration.

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## j.                                                                  Termination of the Company’s Obligations.  Theobligations of the Company to register Registrable Securities under Sections2.1, 2.2 and 2.3 will terminate on the earlier to occur of

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### i.                       the sale, lease or other disposition of allor substantially all of the assets of the Company;

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### ii.                    an acquisition of the Company by anotherentity by consolidation, merger or other reorganization in which the holders ofthe Company’s outstanding voting shares immediately prior to such transactionown, immediately after such transaction, securities representing less thanfifty percent (50%) of the voting power of the entity surviving suchtransaction; or

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### iii.                 with respect to each Holder, whenever suchHolder holds no Registrable Securities or may sell all such Holder’sRegistrable Securities without registration pursuant to an exemption under Rule 144or other exemption then applicable.

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# 3.                                       ASSIGNMENT AND AMENDMENT**.**

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## a.                                                               Assignment.  No person may be assigned the registration rights of a Holderunder this Agreement (a) unless the Company is given written notice by theassigning Holder at the time of such assignment stating the name and address ofthe assignee and identifying the securities of the Company as to which therights in question are being assigned; and (b) only to persons that arepermitted transferees of the Warrant, or the Registrable Securities andprovided further that prior to such assignment, any such assignee must executea agreement to be bound by this Agreement in a form reasonably satisfactory tothe Company and the assigning Holder.

##  

## b.                                                              Amendment of Rights.  Any provision of this Agreement maybe amended and the observance thereof may be waived (either generally or in aparticular instance and either retroactively or prospectively), only with thewritten consent of (i) the Company, and (ii) Holders then holding atleast a majority of all of the Registrable Securities.  Any amendment or waiver effected inaccordance with this Section 3.2 will be binding upon (i) eachHolder, (ii) each permitted successor or assignee of such Holder and (iii) theCompany.

##  

# 4.                                       GENERAL PROVISIONS**.**

#  

## a.                                                               Third Parties.  Nothing in this Agreement, express orimplied, is intended to confer upon any person, other than the parties heretoand their successors and assigns, any rights or remedies under or by reason ofthis Agreement.

 

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## b.                                                              Adjustments for Stock Splits.  Wherever in this Agreement there is areference to a specific number of shares of Common Stock of the Company or anyclass or series, then, upon the occurrence of any subdivision, combination orshare dividend of such class or series of shares, the specific number of sharesso referenced in this Agreement will automatically be proportionally adjustedto reflect the affect on the outstanding shares of such class or series ofshares by such subdivision, combination or share dividend.

##  

## c.                                                               Severability. Whenever possible, each provision of this Agreement must be interpretedin a manner as to be effective and valid under applicable law, but if anyprovision of this Agreement is held to be invalid, illegal or unenforceable inany respect under any applicable law or rule in any jurisdiction, theinvalidity, illegality or unenforceability will not affect any other provisionor any other jurisdiction, but this Agreement will be reformed, construed andenforced in such jurisdiction as if the invalid, illegal or unenforceableprovision had never been contained herein.

##  

## d.                                                              Entire Agreement. Except as otherwise expressly set forth herein or in agreements executedcontemporaneously herewith, this document embodies the complete agreement andunderstanding among the parties hereto with respect to the subject matterhereof and supersedes and preempts any prior understandings, agreements orrepresentations by or among the parties, written or oral, that may have relatedto the subject matter hereof in any way.

##  

## e.                                                               Successors and Assigns. Except as otherwise provided herein, this Agreement will shall bind andinure to the benefit of and be enforceable by the Company and its successorsand assigns and the Holders and their respective successors and assigns.

##  

## f.                                                                 Counterparts.  ThisAgreement may be executed in separate counterparts each of which will be anoriginal and all of which taken together will constitute one and the same agreement.

##  

## g.                                                              Remedies.  The Company and each Holderwill be entitled to enforce its rights under this Agreement specifically torecover damages by reason of any breach of any provision of this Agreement andto exercise all other rights existing in its favor.  The parties hereto agree and acknowledge thatmoney damages may not be an adequate remedy for any breach of the provisions ofthis Agreement and that the Company and each Holder may in its sole discretionapply to any court of law or equity of competent jurisdiction for specificperformance and injunctive relief (without posting a bond or other security) inorder to enforce or prevent any violation of the provisions of this Agreement.

 

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## h.                                                              Notices.  All notices, requests,consents and other communications hereunder to any party will be deemed to besufficient if contained in a written instrument delivered in person, includingdelivery by recognized express courier, fees prepaid, or sent by facsimile transmission,or duly sent by first class registered or certified mail, return receiptrequested, postage prepaid, in each case addressed:  if to the Company, at

##  

PPT Vision, Inc.

12988 Valley View Road

Eden Prairie, MN   55344

Attention:

Mr. JosephC. Christenson

ChiefExecutive Officer

 

orat such other address or addresses as may have been furnished in writing by theCompany to the Holders, with a copy to

 

Lindquist & Vennum, P.L.L.P.

4200IDS Center

80South Eighth Street

Minneapolis,MN 55402

Facsimile:(612) 371-3207,

Attention:Thomas G. Lovett, IV

 

if to a Holder, at the address and facsimile number set forth thereforefor the Holder on Annex I attached hereto, or such other address as mayhereafter be designated in writing by the addressee to the addressor pursuantto this Section 4.08.  All suchnotices, requests, consents and other communications will be deemed to havebeen received in the case of personal delivery, including delivery by expresscourier, on the date of such delivery; in the case of facsimile transmission,on the date of transmission; and in the case of mailing, on the third day afterdeposit in the U.S. mail, proper postage prepaid.

 

## i.                                                                  Governing Law.  ThisAgreement will be governed by and construed in accordance with the internal lawsof the State of Minnesota, without giving effect to any choice of law or otherconflict of law provision or rule (whether of the State of Minnesota orany other jurisdiction) that would cause the application of the laws of anyjurisdiction other than the State of Minnesota.

##  

## j.                                                                  Descriptive Headings.  Thedescriptive headings of this Agreement are inserted for convenience only and donot constitute a part of this Agreement.

 

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IN WITNESS WHEREOF, this Agreement has been executed as of the datefirst written above.

 
|   | **COMPANY**:                 |
|--------|------------------------------|
|   | PPT Vision, Inc.        |
|   |                         |
|   | By:                          |   /s/ Joseph C. Christenson |
|   | Its:                         |  Chief Executive  Officer |
|   |                         |
|   | **INVESTOR**:                |
|   | P.R. Peterson Co. Keogh Plan |
|   |                         |
|   | By:                          |   /s/ Peter R. Peterson |
|   | Its:                         |   Trustee |

 

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**ANNEX I**

 

**HOLDER(S)**

 

**Name & Address**

 

P.R. Peterson Co. Keogh Plan

6111 Blue Circle,

Minnetonka, Minnesota

55343-9102

 

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