EXHIBIT 10.1


 


Settlement
and Release Agreement


 


This Settlement and
Release Agreement (this “Agreement”), dated as of August 30, 2019 (the “Effective Date”),
is made and entered into by and between TSR, Inc. (the “Company”), Zeff Capital, L.P. (“Zeff Capital”),
Zeff Holding Company, LLC (“Zeff Holding”) and Daniel Zeff (together with Zeff Capital and Zeff Holding, the
“Zeff Parties”), QAR Industries, Inc. (“QAR”) and Robert Fitzgerald (together with QAR, the
“QAR Parties”), and Fintech Consulting, LLC (“Fintech”) and Tajuddin Haslani (together with
Fintech, the “Fintech Parties”). Each of the foregoing is referred to as a “Party” and they
are collectively referred to as the “Parties.” The Zeff Parties, the QAR Parties and the Fintech Parties are
collectively referred to as the “Investor Parties.” The Parties covenant and agree as follows:


 


Recitals


 


This Agreement is entered
into for the purpose of settling and forever resolving any and all disputes between the Company and the Investor Parties, and any
entities owned, managed, operated, and/or controlled in the past, present, or future by any of the Investor Parties, including
but not limited to disputes arising out of or relating to the following matters (the “Disputes”):


 


(i) A
Complaint for Declaratory and Injunctive Relief for Violations of the Federal Securities Laws filed on December 21, 2018 by the
Company against the Investor Parties in the United States District Court in the Southern District of New York, Index No. 18-12124
(the “Federal Securities Action”). The Federal Securities Action is currently pending.


 


(ii) A
Complaint to Compel Annual Meeting of Stockholders filed on August 7, 2019 by Zeff Capital against the Company in the Delaware
Court of Chancery, C.A. No. 2019-0615-JTL (the “Zeff Delaware Action”). The Zeff Delaware Action is currently
pending.


 


(iii) Cross-Claims
Relating to Alleged Breaches of Fiduciary Duties and for Indemnification and Contribution filed on July 26, 2019 by the Company
against the Investor Parties in New York Supreme Court, Queens County, Index No. 715541/2018 (the “Queens County Action”).
The Cross-Claims in the Queens County Action are currently pending.


 


(iv) A
Complaint Relating to Alleged Breaches of Fiduciary Duties filed on November 1, 2018 by Fintech against the Company in the Delaware
Court of Chancery, C.A. No. 2018-0792-JTL (the “Fintech Delaware Action”). The Fintech Delaware Action has been
voluntarily dismissed without prejudice.


 


This Agreement is entered
into for the purpose of forever and finally settling and compromising any and all claims and controversies, including but not limited
to the Disputes, existing between and among the Parties as of the date of this Agreement.


 






     


     


    

 


NOW THEREFORE, as consideration
of the foregoing, the covenants and agreements set forth in this Agreement, and other good and valuable consideration the adequacy
and receipt of which are hereby acknowledged, the Parties hereby agree as follows:


 


Operative
Provisions


 


1. Stock
Repurchase. Concurrently with the execution of this Agreement, the Parties have entered into the Share Repurchase Agreement,
dated as of the date hereof, attached as Exhibit A (the “Repurchase Agreement”), providing for the purchase
of the shares of common stock of the Company, par value $0.01 per share (“Common Stock”), beneficially owned
by the Investor Parties as of the date hereof, by the Company and Christopher Hughes, subject to the terms and conditions contained
therein (the “Repurchase”).


 


2. Settlement
Payment. Upon the terms set forth in this Agreement, and subject to the execution of the Repurchase Agreement by the Parties,
the Company hereby agrees to pay the Investor Parties an amount of $1,543,287.50 at the closing of the Repurchase for the settlement
of the Disputes, dismissal of any and all claims related thereto and the settlement and release of any and all matters described
herein (the “Settlement Payment”). The Investor Parties shall determine in their sole discretion how the Settlement
Payment is allocated among the Investor Parties. For the avoidance of doubt, the payment of the Settlement Payment shall not occur
in the event that the Company and Christopher Hughes fail to consummate the Repurchase for any reason. The Company shall pay the
Settlement Payment by wire transfer of immediately available funds to such accounts as the Investor Parties shall have specified
in writing at least one business day in advance.


 


3. Actions
with Respect to the Company.


 


(a) Governance
Changes.


 


(i) The
Board of Directors of the Company (the “Board”) shall, immediately following
the execution of this Agreement:


 


(1) amend
the Company’s Bylaws (the “Bylaws”), in the form attached as Exhibit B; and


 


(2) amend
and restate the Rights Agreement, dated as of August 29, 2018, between the Company and Continental Stock Transfer & Trust Company
(the “Rights Agreement”) in the form attached as Exhibit C.


 


(ii) The
Investor Parties shall not take any action to call or otherwise cause a special meeting of stockholders to occur prior to 5:00
p.m., Eastern Time, on December 30, 2019 unless the Company fails to hold the 2018 Annual Meeting (as defined herein) as provided
in Section 3(b)(i) of this Agreement.


 


(iii) The
Company agrees that prior to the earlier of (A) the completion of the Repurchase and the payment of the Settlement Payment and
(B) January 1, 2020, the Board shall not consist of more than seven (7) directors.


 






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(b) 2018
Annual Meeting.


 


(i) The
Company shall hold its next annual meeting following the date hereof on October 22, 2019 (the “2018 Annual Meeting”).
The Company will not adjourn, delay or postpone the 2018 Annual Meeting.


 


(ii) The
Company shall solicit proxies for two alternative Class I director slates at the 2018 Annual Meeting. One slate shall consist of
two directors nominated by the Company, who shall be Ira Cohen and Raymond Roel (the “TSR Slate”). The other
slate shall consist of two directors nominated by Zeff Capital, who shall be H. Timothy Erikson and Bradley M. Tirpak (or any other
individuals chosen by Zeff Capital in its sole discretion) (the “Zeff Slate”); provided that no director nominated
by Zeff Capital may join the Board until he or she has executed and delivered a conditional resignation in the form attached as
Exhibit E. Pursuant to this Agreement, the Company waives any application of its advance notice bylaw with respect to the Zeff
Slate.


 


(iii) If
the Repurchase and payment of the Settlement Payment are completed prior to 5:00 p.m., Eastern Time, on October 21, 2019, then
the TSR Slate shall be the only slate of directors standing for election to the Board and the Zeff Slate shall be withdrawn from
consideration at the 2018 Annual Meeting. In such event, the Zeff Parties hereby agree to take all actions reasonably necessary
to withdraw the Zeff Slate and to cause the nominees of the Zeff Slate to decline to stand for election at the 2018 Annual Meeting.
In such event, the Zeff Parties, the QAR Parties and the Fintech Parties shall cause any shares of Common Stock beneficially owned
by them and their controlled affiliates as of the record date for the 2018 Annual Meeting to be present for quorum purposes at
the 2018 Annual Meeting and to be voted in favor of the TSR Slate at the 2018 Annual Meeting.


 


(iv) If
the Repurchase and payment of the Settlement Payment are not completed prior to 5:00 p.m., Eastern Time, on October 21, 2019, then
the Zeff Slate shall be the only slate of directors standing for election to the Board and the TSR Slate shall be withdrawn from
consideration at the 2018 Annual Meeting. In such event, TSR hereby agrees to take all actions reasonably necessary to withdraw
the TSR Slate and to cause the nominees of the TSR Slate to decline to stand for election at the 2018 Annual Meeting. In such event,
the Company shall cause its directors and executive officers to cause any shares of Common Stock beneficially owned by them as
of the record date for the 2018 Annual Meeting to be present for quorum purposes and to be voted in favor of the Zeff Slate at
the 2018 Annual Meeting.


 


(v) The
Company agrees to solicit proxies for the 2018 Annual Meeting for the TSR Slate and the Zeff Slate and otherwise in a manner consistent
with the manner in which it has solicited proxies for its previous annual meetings. The Company also agrees that it will bear all
expenses incurred by it subsequent to the date hereof related to the 2018 Annual Meeting.


 


(vi) The
Parties agree that the election of two Class I directors and the ratification of the Company’s auditors shall be the only
matters considered at the 2018 Annual Meeting (except for any matters properly brought before the 2018 Annual Meeting by any stockholder
of the Company other than the Investor Parties and controlled affiliates thereof), and the Investor Parties shall not take any
action designed to cause other matters to be brought for consideration at the 2018 Annual Meeting.


 






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(c) Conditional
Resignations.


 


(i) Concurrently
with the execution of this Agreement, each director of the Board has executed and delivered, and shall not repudiate, a conditional
resignation, in the form attached as Exhibit D, effective at 5:00 p.m., Eastern Time on December 30, 2019, if the Repurchase and
payment of the Settlement Payment are not completed by such time and date. For the avoidance of doubt, such resignations will be
void upon the closing of the Repurchase and payment of the Settlement Payment if they both occur by 5:00 p.m., Eastern Time on
December 30, 2019. The Company shall not elect or appoint any director after the date of this Agreement (other than the members
of the Zeff Slate) who does not deliver such a conditional resignation at the time of such election or appointment.


 


(ii) Each
member of the Zeff Slate shall execute and deliver, concurrently with his or her appointment to the Board, and shall not repudiate,
a conditional resignation, in the form attached as Exhibit E, effective upon the closing of the Repurchase and payment of the Settlement
Payment if such closing occurs by 5:00 p.m., Eastern Time, on December 30, 2019. For the avoidance of doubt, such resignations
will be void after 5:00 p.m., Eastern Time, on December 30, 2019, if the Repurchase and payment of the Settlement Payment have
not occurred by that time.


 


(d) Consequences
of Failure to Consummate the Repurchase.


 


If the Repurchase and
payment of the Settlement Payment are not consummated by 5:00 p.m., Eastern Time, on December 30, 2019, the following shall occur:


 


(i) the
conditional resignations of the Company’s directors described in Section 3(c)(i) shall become effective immediately
and the Zeff Slate will constitute the only directors then-serving on the Board; and


 


(ii) The
Company shall cause all directors and executive officers of the Company, in their capacity as stockholders, to vote any shares
of Common Stock that they beneficially own in favor of any matters necessary to effectuate the requirements of this Section
3(d) that shall require the approval of the stockholders of the Company.


 


(e) Limitation
on Remedies. The consequences set forth in Section 3(d) are the sole remedies available to the Investors for the failure
of the Company and/or Christopher Hughes to comply with any of its or his obligations under the Repurchase Agreement or Sections
1 or 2 of this Agreement. In no event shall the Investor Parties be entitled to monetary damages or specific performance
with respect to any such failure of the Company and/or Christopher Hughes to perform any of its or his obligations under the Repurchase
Agreement or Sections 1 or 2 of this Agreement.


 


(f) Operation
of the Company. Prior to the Repurchase and payment of the Settlement Payment, the Company shall, and shall cause its subsidiaries
to, operate its and their respective businesses in the ordinary course of business consistent with past practice.


 






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4. Standstill.


 


(a) Effective
as of the execution of this Agreement, each Investor Party, on behalf of itself and its controlled affiliates, hereby agrees that
it shall not, and that its controlled affiliates shall not, other than as expressly set forth herein, directly or indirectly, in
any manner (whether through or in concert with third parties or otherwise): (i) except for the Zeff Slate, nominate or recommend
for nomination any person for election at the 2018 Annual Meeting; (ii) submit any proposal for consideration at, or bring any
other business before, the 2018 Annual Meeting; (iii) initiate, encourage or participate in any “withhold” or similar
campaign with respect to the 2018 Annual Meeting; or (iv) publicly or privately encourage or support any other stockholder to take,
or support in the taking of, any of the actions or matters described in this Section 4(a). Effective as of the execution
of this Agreement, Zeff Capital hereby irrevocably withdraws the Notice of Nominations of Directors and Stockholder Proposals
submitted to the Company on August 1, 2019 and agrees to inform the applicable examiner at the Securities and Exchange Commission
that it will not be pursuing its proxy statement.


 


(b) From
the date of this Agreement until the Expiration Date or until such earlier time as the restrictions in this Section 4(b)
terminate as provided herein, each Investor Party agrees that, unless consented to by the Company, as permitted by Section 3(a)(ii)
or as otherwise expressly permitted by this Agreement, neither it nor any of its controlled affiliates will, directly or indirectly,
in any manner (whether through, or in concert with, third parties or otherwise), other than in support of and in favor of the election
of the TSR Slate or Zeff Slate, as applicable:


 


(i) effect
or seek to effect (including, without limitation, by entering into any discussions, negotiations, agreements or understandings),
offer or propose (whether publicly or privately) to effect, or cause or participate in, or in way knowingly assist, encourage,
support or facilitate any other person to effect or seek, offer or propose to effect any of the following involving the Company
or any of its subsidiaries or its or their securities or a material amount of assets or businesses of the Company and its subsidiaries:
any tender offer or exchange offer, merger, acquisition, business combination, reorganization, restructuring, recapitalization,
sale or acquisition of material assets, liquidation or dissolution (each and collectively, an “Extraordinary Transaction”),
or publicly comment, or privately comment in a manner reasonably expected not to be held in confidence, on any third party
proposal regarding any Extraordinary Transaction by any third party prior to or following such proposal becoming public; provided that
the Investor Parties shall be permitted to (A) publicly and privately disclose how they intend to vote or act with respect to such
Extraordinary Transaction; and (B) sell or tender their shares of Common Stock, and otherwise receive consideration, pursuant to
any Extraordinary Transaction so long as no Investor Party has assisted, encouraged, supported or facilitated (whether publicly
or privately) such Extraordinary Transaction;


 


(ii) enter
into, offer or propose to enter into any short sale or purchase, sale or grant of any securities (or beneficial ownership thereof)
of the Company or any option, warrant, derivative, convertible security or stock appreciation right (including without limitation,
any put or call option or swap transaction) with respect to or having any measurement relating to any securities (or beneficial
ownership thereof) of the Company;


 


(iii) solicit
proxies or written consents of stockholders or conduct any other type of referendum (binding or non-binding) with respect to, or
from the holders of, the Common Stock, or become a “participant” (as such term is defined in Instruction 3 to Item
4 of Schedule 14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) in
or assist any person not a Party to this Agreement in any “solicitation” of any proxy, consent or other authority (as
such terms are defined under the Exchange Act) to vote any shares of the Common Stock (other than such encouragement, advice or
influence that is consistent with Company management’s recommendation in connection with such matter);


 






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(iv) advise
or encourage any person with respect to the voting of any securities of the Company at the 2018 Annual Meeting, any annual meeting
held prior to the Expiration Date or any special meeting of stockholders, or seek to do so (other than such encouragement, advice
or influence that is consistent with the Company’s recommendation in connection with such matter);


 


(v) take
any action challenging the validity or enforceability of this Agreement;


 


(vi) seek
or knowingly encourage any person to submit nominations in furtherance of a “contested solicitation” for the election
or removal of directors with respect to the Company or seek, encourage or take any other action with respect to the election or
removal of any directors or with respect to the submission of any stockholder proposal;


 


(vii) form,
join in or in any way participate in a partnership, limited partnership, syndicate or other group, including without limitation,
a group defined under Section 13(d) of the Exchange Act;


 


(viii) other
than expressly permitted under this Agreement, seek, alone or in concert with others, representation on the Board; and


 


(ix) seek
or request permission to do any of the foregoing, make any request to amend, waive or terminate any provision of this Section
4 (including, without limitation, this Section 4(b)), or make or seek permission to make any public announcement with
respect to any of the foregoing; provided that an Investor Party may make a confidential request to the Board that the Company
amend or waive the terms of this Agreement in a manner that would not be reasonably likely to require public disclosure by the
Company or such Investor Party. As used in this Agreement, the term “affiliate” shall have the meaning set forth
in Rule 12b-2 promulgated by the SEC under the Exchange Act, and shall include all persons or entities that, at any time during
the term of this Agreement, become an affiliate of any person or entity referred to in this Agreement. For the purposes of this
Section 4, the term “Expiration Date” shall mean 5:00 p.m., Eastern Time, on December 30, 2019, unless
the Repurchase and payment of the Settlement Payment are consummated prior to such time, in which case it shall mean the opening
of the Company’s advance notice period in respect of its annual meeting occurring during the calendar year 2027.


 


5. Dismissal
of All Pending Actions. Upon the execution of this Agreement, the Parties will execute and deliver to each other’s
counsel stipulations and/or agreed motions of dismissal dismissing the following pending actions with prejudice: (i) the Federal
Securities Action; (ii) the Zeff Delaware Action; and (iii) the Cross-Claims in the Queens Action. As soon as practicable after
the Effective Date, but in no event later than two (2) business days after the date of this Agreement, the Company shall file the
stipulations for the Federal Securities Action and the Cross-Claim in the Queens Action with those respective courts. As soon as
practicable after the Effective Date, but in no event later than two (2) business days after the date of this Agreement, Zeff shall
file the stipulations for the Zeff Delaware Action with the Delaware Court of Chancery.


 






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6. Release
by the Company. As of the Effective Date, the Company, on behalf of itself and its current and former corporate entities
and controlled affiliates, executors, heirs, devisees, estates, personal representatives, officers, directors, successors, and
assigns (the “Company Releasors”), in consideration of this Agreement and the Repurchase and for good and valuable
consideration, the adequacy of which is hereby acknowledged, hereby releases and forever discharges each of the Investor Parties
and each of their current and former corporate entities, controlled affiliates, partnerships, and joint venturers, and any and
all of their present and former principals, representatives, agents, associates, controlled affiliates, partners, members, shareholders,
directors, officers, managing members, managers, employees, insurers, reinsurers, lienholders, accountants, advisors, attorneys,
estates, heirs, executors, administrators, predecessors, successors, and/or assigns (the “Investor Releasees”),
from any and all claims, demands, rights, actions, causes of action, suits, obligations, damages, judgments, contracts, decrees,
controversies, liabilities, rights of contribution and/or indemnification, costs, expenses or attorneys’ fees, of whatever
kind or nature, fixed or contingent, liquidated or unliquidated, foreseen or unforeseen, accrued or not accrued, at law or equity,
whether individual, class or derivative in nature, under any statutory, common law, contract, tort or other theory, or intentional
or negligent or other wrongdoing, for compensatory, consequential, punitive or exemplary damages or any damages or relief whatsoever,
from the beginning of the world to the Effective Date, which the Company Releasors have, had, or can, shall, or may hereafter have
against any of the Investor Releasees by reason of any matter, cause or thing whatsoever, including, but not limited to the Disputes,
matters, and agreements described in this Agreement (the “Company Released Matters”); provided, however, that
this paragraph 6 does not release and shall not be construed to release any obligations under this Agreement or the Repurchase
Agreement. The Company Releasors acknowledge that they may, after executing this Agreement, discover facts other than or different
from those which they know or believe to be true with respect to the Investor Releasees relating to the Company Released Matters.
Notwithstanding any such discovery of facts, the Company Releasors waive and fully, finally, and forever settle and release any
known or unknown, suspected or unsuspected, contingent or noncontingent claim that accrued prior to the execution of this Agreement
relating to the Company Released Matters whether or not concealed or hidden, without regard to the subsequent discovery or existence
of such other facts. The Company Releasors expressly waive and release any and all provisions, rights, and benefits conferred by
§1542 of the California Civil Code, which provides:


 


Section 1542. Certain Claims Not
Affected by General Release. A general release does not extend to claims that the creditor
or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known
by him or her, would have materially affected his or her settlement with the debtor or released party;


 


or by any law of any state or territory
of the United States, or principle of common law, which is similar, comparable, or equivalent to Section 1542 of the California
Civil Code.


 






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7. Release
by the Investor Parties. As of the Effective Date, the Investor Parties, on behalf of themselves and their current and
former corporate entities, controlled affiliates, executors, heirs, devisees, estates, personal representatives, officers, directors,
successors, and assigns (the “Investor Releasors”), in consideration of this Agreement and for good and valuable
consideration, the adequacy of which is hereby acknowledged, hereby release and forever discharge the Company and its current and
former corporate entities, affiliates, partnerships, and joint venturers, and any and all of its and their present and former principals,
representatives, agents, associates, affiliates, partners, members, shareholders, directors, officers, managing members, managers,
employees, insurers, reinsurers, lienholders, accountants, advisors, attorneys, estates, heirs, executors, administrators, predecessors,
successors, and/or assigns (the “Company Releasees”) and each of the other Investor Releasees, from any and
all claims, demands, rights, actions, causes of action, suits, obligations, damages, judgments, contracts, decrees, controversies,
liabilities, rights of contribution and/or indemnification, costs, expenses or attorneys’ fees, of whatever kind or nature,
fixed or contingent, liquidated or unliquidated, foreseen or unforeseen, accrued or not accrued, at law or equity, whether individual,
class or derivative in nature, under any statutory, common law, contract, tort or other theory, or intentional or negligent or
other wrongdoing, for compensatory, consequential, punitive or exemplary damages or any damages or relief whatsoever, from the
beginning of the world to the Effective Date, which the Investor Releasors have, had, or can, shall, or may hereafter have against
any of the Company Releasees or the other Investor Releasees by reason of any matter, cause or thing whatsoever, including, but
not limited to the Disputes, matters, and agreements described in this Agreement (the “Investor Released Matters”
and together with the Company Released Matters, the “Released Matters”); provided, however, that this paragraph
7 does not release and shall not be construed to release any obligations under this Agreement or the Repurchase Agreement. The
Investor Releasors acknowledge that they may, after executing this Agreement, discover facts other than or different from those
which they know or believe to be true with respect to the Company Releasees relating to the Investor Released Matters. Upon execution
of a reciprocal release by Joseph F. Hughes, Regina Dowd, Winifred Hughes, James Hughes, Patrick Hughes and Lisa Bank (the “Hughes
Family Members”) occurring within seven (7) days of the date hereof, the Hughes Family Members shall become Company Releasees
hereunder; provided, however, that if the Hughes Family Members do not execute a reciprocal release prior to such date, they shall
not be considered Company Releasees hereunder or beneficiaries of this paragraph 7. Notwithstanding any such discovery of facts,
the Investor Releasors waive and fully, finally, and forever settle and release any known or unknown, suspected or unsuspected,
contingent or noncontingent claim that accrued prior to the execution of this Agreement relating to the Investor Released Matters
whether or not concealed or hidden, without regard to the subsequent discovery or existence of such other facts. The Investor Releasors
expressly waive and release any and all provisions, rights, and benefits conferred by §1542 of the California Civil Code,
which provides:


 


Section 1542. Certain Claims Not
Affected by General Release. A general release does not extend to claims that the creditor or releasing party does not know
or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially
affected his or her settlement with the debtor or released party;


 


or by any law of any state or territory
of the United States, or principle of common law, which is similar, comparable, or equivalent to Section 1542 of the California
Civil Code.


 






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8. Forbearance
from Suit. Except as otherwise permitted under this Agreement, the Repurchase Agreement, or as required by operation of
law or court order, each of the Parties agrees that it will (and will cause its respective Company Releasors and Investors Releasors,
as applicable, to) forever refrain and forbear from commencing, initiating, filing, instituting, financing, aiding, prosecuting,
encouraging, supporting, inducing, participating and/or otherwise assisting in any lawsuit, action, and/or other proceeding and/or
making any claim against those persons and/or entities referred to in Sections 6 and 7 of this Agreement, based upon
or arising out of any claim, debt, liability, demand, agreement, contract, right of contribution and/or indemnification, obligation,
statement, representation, guaranty, cost, expense, promise, action, omission and/or cause of action that is released and discharged
by reason of this Agreement. Any Party that violates this Section 8 shall be liable for the reasonable attorneys’
fees and costs incurred by any other Party in enforcing its rights hereunder.


 


9. Covenants
Not to Sue. Each of the Parties warrants, covenants and agrees that it will not,
individually or collectively, bring, maintain, or otherwise institute or allow others within its control, including without limitation
its controlled affiliates, to bring, maintain, or otherwise institute any action in any forum anywhere in the world against any
Investor Releasee or any Company Releasee or any other Person that challenges, in each case, to the extent related to the Released
Matters: 


 


(a) the
validity of legality of this Agreement or the authority of the Parties to execute it; or


 


(b) the
compliance on or prior to the date hereof by the members of the Board and the officers of the Company with their fiduciary duties
or contractual obligations (if any) owed to the Company or its stockholders.


 


Each
of the Parties further agrees that it will not knowingly encourage or voluntarily assist any third party asserting any of the challenges
set forth in this Section 9, provided, however, that nothing contained herein shall prevent or restrict
any Party from providing truthful testimony or complying with any applicable law, court order or legal process (including, without
limitation, subpoenas).


 


10. Stockholder
Actions. 


 


(a) Except
as required by law or court order (in which case the Company agrees to provide prompt notice to any of the Investor Parties that
may be impacted by such action), the Company agrees not to voluntarily assist or provide cooperation to any stockholders of the
Company in connection with any claim made or action brought by any such stockholders against any of the Investor Parties relating
to the Investor Parties’ activities involving the Company, including but not limited to in connection with the following
lawsuits currently pending in Queens County Supreme Court and the Federal District Court for the Southern District of New York:
(1) Susan Paskowitz v. James J. Hill, et al., No. 715541/2018 (Queens County) and (2) Paskowitz v. Zeff Capital,
L.P. et al., 1:19-cv-00167-KPF (S.D.N.Y). (the “Paskowitz Actions”).


 






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(b) The
Company agrees not to settle the Pakowitz Actions without obtaining a full release of the Investor Parties by Paskowitz and a dismissal
with prejudice of all claims against the Investor Parties.


 


11. No
Admissions. This Agreement is entered into in the interests of avoiding the expenses
and uncertainties of litigation. Neither this Agreement, nor any of its terms and provisions, shall be deemed an admission or concession
of any fact, legal theory, liability, incapacity, undue influence, fault or wrongdoing.


 


12. Non-Disparagement;
Confidentiality.


 


(a) Each
Party agrees that he, she or it shall not, directly or indirectly, publicly criticize, ridicule or make any statement or announcement
that disparages or is derogatory of any other Party (including each such Party’s officers, directors, employees, agents,
attorneys and representatives), in each case, with respect to the subject matter of the Released Matters or related conduct prior
to the date hereof. Notwithstanding the foregoing, no Party shall be prohibited from complying with or responding to any subpoena,
regulatory inquiry or other legal process that is not initiated by such Party.


 


(b) Each
Party agrees not to disclose any non-public information obtained by such Party or its representatives in connection with
the Disputes without the prior written consent of the Company and Zeff Capital, except as required by applicable law, rule, regulation
or the requirements of any applicable stock exchange or listing organization.


 


13. Representations
and Warranties of the Company. The Company represents and warrants to the Investor Parties as follows:


 


(a) the
members of the Board other than Christopher Hughes, who abstained, approved entering into this Agreement, and the Company has the
corporate power and authority to execute this Agreement and to bind it thereto;


 


(b) this
Agreement has been duly and validly authorized, executed and delivered by the Company, and is a valid and binding obligation of
the Company, enforceable against the Company in accordance with its terms, except as enforcement thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws generally affecting the rights of creditors
and subject to general equity principles;


 


(c) the
execution, delivery and performance of this Agreement by the Company does not and will not (i) violate or conflict with any law,
rule, regulation, order, judgment or decree applicable to the Company, or (ii) result in any breach or violation of or constitute
a default (or an event which with notice or lapse of time or both could constitute such a breach, violation or default) under or
pursuant to, or result in the loss of a material benefit under, or give any right of termination, amendment, acceleration or cancellation
of, any organizational document, agreement, contract, commitment, understanding or arrangement to which the Company is a party
or by which it is bound;


 






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(d) as
of the date hereof, there is no suit, action investigation or proceeding pending or, to the knowledge of the Company, threatened
against the Company, that could materially impair the ability of the Company to perform its obligations hereunder or to consummate
the transactions contemplated hereby to which it is a party; and


 


(e) no
consent, approval, order authorization, registration or qualification of or with any governmental or regulatory authority or organization
having jurisdiction over the Company or any third party is required in connection with the execution, delivery and performance
by the Company of this Agreement or the consummation by the Company of any transactions contemplated hereby to which the Company
is a party.


 


14. Representations
and Warranties of Investor Parties. Each Investor Party, severally and not jointly, represents and warrants to the Company
each of the following:


 


(a) such
Investor Party has the corporate, limited liability company or other power and authority to execute this Agreement and to bind
it thereto;


 


(b) this
Agreement has been duly authorized, executed and delivered by such Investor Party, and is a valid and binding obligation of such
Investor Party, enforceable against such Investor Party in accordance with its terms, except as enforcement thereof may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws generally affecting the
rights of creditors and subject to general equity principles;


 


(c) the
execution, delivery and performance of this Agreement by such Investor Party does not and will not (i) violate or conflict with
any law, rule, regulation, order, judgment or decree applicable to such Investor Party, or (ii) result in any breach or violation
of or constitute a default (or an event which with notice or lapse of time or both could constitute such a breach, violation or
default) under or pursuant to, or result in the loss of a material benefit under, or give any right of termination, amendment,
acceleration or cancellation of, any organizational document, agreement, contract, commitment, understanding or arrangement to
which such Investor Party is a party or by which it is bound;


 


(d) as
of the date hereof, there is no suit, action investigation or proceeding pending or, to the knowledge of such Investor Party, threatened
against such Investor Party, that could materially impair the ability of such Investor Party to perform its obligations hereunder
or to consummate the transactions contemplated hereby to which it is a party; and


 


(e) no
consent, approval, order authorization, registration or qualification of or with any governmental or regulatory authority or organization
having jurisdiction over such Investor Party is required in connection with the execution, delivery and performance by such Investor
Party of this Agreement or the consummation by such Investor Party of any transactions contemplated hereby to which such Investor
Party is a party.


 


15. Press
Release. Promptly following the execution of this Agreement, the Company will issue a press release in the form attached
as Exhibit F hereto (the “Agreed Press Release”) announcing this Agreement. The Parties shall not make
any public announcement or public statement that is inconsistent with or contrary to the statements made in the Agreed Press Release.


 






    11


     


    

 


16. Public
Filing.


 


(a) As
promptly as practicable following the execution of this Agreement, the Zeff Parties shall file with the Securities and Exchange
Commission an amendment to their Schedule 13D initially filed on July 26, 2018, as amended prior to the date hereof, disclosing,
among other things, the Zeff Parties’ public and irrevocable withdrawal and rescission of each proposal and director nomination
that the Zeff Parties have put forth for consideration at the 2018 Annual Meeting, and prior to such filing shall provide Company
and its outside counsel with a reasonable opportunity to review and comment upon such amendment, and the Zeff Parties shall consider
any comments in good faith.


 


(b) As
promptly as practicable following the execution of this Agreement, the Company shall file with the Securities and Exchange Commission
a Form 8-K disclosing, among other things, this Agreement and the Repurchase Agreement, and prior to such filing shall provide
the Zeff Parties and their outside counsel with a reasonable opportunity to review and comment upon such filing, and the Company
shall consider any comments in good faith.


 


17. Notices.
All notices, demands, requests and other communications (collectively “Notices”) given or served by any Party in connection
with this Agreement shall be in writing. Notices should be given (a) by mailing the same by certified or registered mail, postage
prepaid, return receipt requested; (b) by hand delivery with receipt; or (c) by overnight courier with receipt,, as follows:


 


Notices to the Company shall be sent to:


 


TSR, Inc.


Attn: Christopher Hughes


420 Lexington Avenue, Suite 835


New York, NY 10170


Chris.Hughes@tsrconsulting.com


 


- and -


 


Arnold & Porter Kaye Scholer LLP


Attn: Rory Greiss and Aaron Miner


250 West 55th Street


New York, NY 10019


(212) 836-8000


Rory.Greiss@arnoldporter.com


Aaron.Miner@arnoldporter.com


 


Notices to the Zeff Parties shall be sent to:


 


Zeff Holding Company, LLC


885 Sixth Avenue


New York, New York 10001


Attn: Daniel Zeff


 






    12


     


    

 


- and -


 


Wilson Sonsini Goodrich &
Rosati


Professional Corporation


650 Page Mill Road


Palo Alto, California 94063


Attn: Douglas K. Schnell and
David J. Berger


 


Notices to the QAR Parties shall be sent to:


 


QAR Industries,


Att: Mr. Robert Fitzgerald


101 Southeast 25th Avenue


Mineral Wells, TX 76067


rob@qarllc.com


 


- and -


 


O’Hare Parnagian LLP


Att:  Robert A. O’Hare
Jr., Esq.


20 Vesey Street, Suite 300


New York, NY  10007


(212) 425-1401


rohare@ohareparnagian.com


 


Notices to the Fintech Parties shall be sent to:


 


Robert J. Basil

The Basil Law Group, P.C.

1270 Broadway, Suite 305

New York, NY 10001

917-512-3066

831-536-1075 (fax)


 


Notices may also be provided to such other
address or addresses subsequently provided by a Party to the other Parties.


 


18. Representation
by Counsel. The Parties separately acknowledge that they have been afforded ample opportunity to review and evaluate this
Agreement prior to executing to it and that they have been represented and assisted by counsel for that purpose. The Parties acknowledge
and agree that they are entering into this Agreement freely and voluntarily, without duress or coercion of any kind, and as an
informed and well-reasoned exercise of their respective business judgments. Further, each Party shall be deemed the author of this
Agreement for purposes of the Agreement’s construction, and therefore any ambiguity in this Agreement shall not be construed
against any Party on the grounds that a particular Party drafted the purportedly ambiguous term(s) or prepared this Agreement.


 






    13


     


    

 


19. Integration/Modification.
This Agreement, together with the Repurchase Agreement, is completely integrated and contains the Parties’ entire agreement
and is intended to be enforceable according to its written terms. There are no oral agreements, promises, covenants, warranties,
or representations to the contrary or beyond the written terms of this Agreement upon which any Party has relied in entering into
this Agreement other than those expressly contained in this Agreement and the Repurchase Agreement. This Agreement may be modified
only by a writing signed by all of the Parties.


 


20. Further
Cooperation. The Parties covenant and agree that, without expanding their substantive obligations under this Agreement,
they shall do all acts and execute and obtain all documents, to the full extent necessary or appropriate, to implement and enforce
this Agreement according to its terms.


 


21. Applicable
Law. This Agreement shall be construed in accordance with, and governed in all respects by, the internal laws of the State
of Delaware (without giving effect to principles of conflicts of laws).  Any legal proceeding relating to this Agreement or
the enforcement of any provision of this Agreement shall be commenced in the Court of Chancery of the State of Delaware (or, if
any such court declines to accept jurisdiction over a particular matter, any state or federal court located in Delaware). 
Each Party: (i) expressly and irrevocably consents and submits to the jurisdiction of each state and federal court located in Delaware
(and each appellate court related thereto) in connection with any such legal proceeding; (ii) agrees that each state and federal
court located in Delaware shall be deemed to be a convenient forum; and (iii) agrees not to assert (by way of motion, as a defense
or otherwise), in any such legal proceeding commenced in any state or federal court located in Delaware, any claim that such Party
is not subject personally to the jurisdiction of such court, that such legal proceeding has been brought in an inconvenient forum,
that the venue of such proceeding is improper or that this Agreement or the subject matter of this Agreement may not be enforced
in or by such court.  EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY CLAIM, ACTION, SUIT OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT. EACH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY CLAIM, ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(II) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 21.


 


22. Equitable
Relief. except as set forth in Section 3(e), if any Party breaches any of the provisions of this Agreement, in addition
to any other remedy that the non-breaching Party may have at law or in equity, the breaching Party agrees that the non-breaching
Party would suffer irreparable harm which would not be adequately compensated by monetary damages as a result of such breach and,
solely upon showing of a likelihood of success of establishing that such material breach occurred, shall be entitled to a preliminary
injunction to prevent the continuance of such breach, without the requirement of the posting of a bond.


 






    14


     


    

 


23. Binding
Effect. This Agreement shall be binding upon and/or inure to the benefit of the Parties and their respective heirs, estates,
executors, administrators, personal representatives, successors, corporate parents and assigns. This
Agreement is not intended to and shall not confer any rights or remedies upon any person other than the Parties and their respective
successors and permitted assigns; provided that to the extent not a Party to this Agreement, each of the Investor
Releasees shall be a third party beneficiary of Section 6, each of the Company Releasees shall be a third party beneficiary
of Section 7 and each member of the Board and officer of the Company shall be a third party beneficiary of Section 9.


 


24. Severability.
In the event any provision of this Agreement is found to be void and unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall nevertheless be binding upon the Parties with the same effect as though the void or unenforceable
part had been severed and deleted.


 


25. Counterparts.
This Agreement may be executed in separate counterparts, each of which shall be deemed and considered an original, and all of which,
when fully executed, shall constitute one and the same instrument. A faxed or emailed counterpart of this Agreement shall be deemed
to be an original.


 


[Remainder of page intentionally
left blank. Signature page follows.]


 




    15


     


    

 


In
Witness Whereof, the Company and the Investor Parties have caused this Agreement to be duly executed and delivered on
their respective behalf as of August 30, 2019, and the persons signing below represent and warrant that they have been duly authorized
to execute this Agreement on behalf of their respective entities.


 


	 	TSR, Inc.
	 	 
	 	By:	/s/Christopher Hughes
	 	Name:	Christopher Hughes
	 	Title:	CEO
	 	 
	 	Zeff Capital, L.P.
	 	 
	 	By:	/s/Daniel Zeff
	 	Name:	Daniel Zeff
	 	Title:	President
	 	 
	 	Daniel Zeff
	 	 
	 	/s/Daniel Zeff
	 	 
	 	QAR Industries, Inc.
	 	 
	 	By:	/s/Robert Fitzgerald
	 	Name: 	Robert Fitzgerald
	 	Title:	 President
	 	 
	 	Robert Fitzgerald
	 	 
	 	/s/Robert Fitzgerald


 






    16


     


    

 


	 	Fintech Consulting, LLC
	 	 
	 	By:	/s/Tajuddin Haslani
	 	Name: 	Tajuddin Haslani
	 	Title:	Manager
	 	 
	 	Tajuddin Haslani
	 	 
	 	/s/Tajuddin Haslani


 






    17


     


    

 


Exhibit A


 


Repurchase Agreement


 


SHARE REPURCHASE AGREEMENT


 


This Share Repurchase
Agreement (this “Share Repurchase Agreement”) is made and entered into as of August 30, 2019, by and between
TSR, Inc. (the “Company”), Christopher Hughes (together with the Company, the “Purchasers”),
Zeff Capital, L.P. (“Zeff Capital”), Zeff Holding Company, LLC (“Zeff Holding”) and Daniel
Zeff (together with Zeff Capital and Zeff Holding, the “Zeff Parties”), QAR Industries, Inc. (“QAR”)
and Robert Fitzgerald (together with QAR, the “QAR Parties”), and Fintech Consulting, LLC (“Fintech”)
and Tajuddin Haslani (together with Fintech, the “Fintech Parties”). The Zeff Parties, the QAR Parties and the
Fintech Parties are collectively referred to herein as the “Sellers.”


 


1. Purchase
and Sale of Shares.


 


(a) Purchase
and Sale. Upon the terms set forth in this Agreement and the Settlement and Release Agreement executed by the Sellers and the
Company concurrently herewith (the “Settlement Agreement”), the Company and Christopher Hughes hereby agree
to purchase from the Sellers, and the Sellers hereby agree to sell to the Company and Christopher Hughes, the number of shares
of common stock of the Company, par value $0.01 per share, owned by the Sellers (the “Shares”) shown on Schedule
A hereto at the purchase price specified in paragraph 1(b) hereof.


 


(b) Purchase
Price. The aggregate purchase price for the Shares to be purchased by the Purchasers is $5,956,712.50 in cash or $6.25 per
share (the “Share Payment”).


 


(c) Expiration.
This Agreement will automatically terminate if the purchase of the Shares by the Purchasers has not occurred by 5:00 p.m., Eastern
Time, on December 30, 2019.


 


2. Settlement.
Within three business days after the date on which the Purchasers provide written notice to Zeff Capital that they are prepared
to consummate the purchase of all of the Shares (such notice, the “Closing Notice”), (i) the Purchasers
shall pay the Share Payment for all of the Shares purchased and sold hereunder by wire transfer of immediately available funds
to such accounts as Sellers shall have specified in writing at least one business day in advance and (ii) the Sellers shall
transfer the number of Shares as specified on Schedule A to the Company’s or Christopher Hughes’ account, as directed
by the Purchasers, at the Company’s transfer agent. The Sellers agree to take all actions and execute all documents and instruments
required to effect the transfer of such Shares, including the execution of appropriate instruments of transfer as reasonably requested
by the Purchasers.


 






    1


     


    

 


3. Representations
and Warranties of Sellers. Each Seller, severally and not jointly, represents and warrants to the Purchasers as follows as
of the date hereof and as of the date of the settlement of the transaction pursuant to Section 2 of this Agreement:


 


(a) Such
Seller owns the number of Shares set forth opposite its name on Schedule A hereto free and clear of all liens, charges,
pledges, encumbrances and rights of third parties. Except for such Shares set forth on Schedule A, such Seller does not
own, beneficially or of record, or have the option or right to acquire, any other shares of capital stock of the Company. No person
or entity has asserted any claim or commenced or threatened any litigation concerning such Seller’s title to its Shares.
Upon delivery of the Shares, such Seller will convey to the Company or Christopher Hughes, as applicable, lawful and valid title
to its Shares, free and clear of any liens, pledges, encumbrances, charges, agreements, restrictions, or claims of any kind, other
than those imposed by applicable securities laws.


 


(b) Such
Seller has the corporate or limited liability company power and authority to enter into this Agreement and the transactions contemplated
hereby have been duly authorized by all necessary corporate action of such Seller.


 


(c) This
Agreement constitutes a legal, valid and binding obligation of such Seller, enforceable against such Seller in accordance with
its terms, except as enforceability may be affected by bankruptcy, insolvency, moratorium or similar laws or by legal or equitable
principles related to or limiting creditors’ rights generally.


 


(d) The
execution, delivery and performance of this Agreement by such Seller and the consummation of the transactions contemplated hereby
will not result in a breach or violation by such Seller of, or constitute a default by such Seller under, any judgment, decree,
order, governmental permit, license, agreement, indenture, instrument, statute, rule or regulation to which such Seller is a party
or by which Seller is bound, other than any breach, violation or default that would not materially impair the ability of the Company
to perform its obligations under this Agreement or to consummate the transactions contemplated hereby, and no authorization, approval
or consent, except such as have been obtained, is required in connection with the execution, delivery and performance by such Seller
of this Agreement or the consummation of the transactions contemplated hereby.


 


(e) As
of the date hereof, there is no suit, action investigation or proceeding pending or, to the knowledge of such Seller, threatened
against such Seller, that could materially impair the ability of such Seller to perform its obligations hereunder or to consummate
the transactions contemplated hereby to which it is a party.


 


4. Representations
and Warranties of Purchasers. Each Purchaser, severally and not jointly, represents and warrants to the Sellers as follows
as of the date hereof and as of the date of the settlement of the transaction pursuant to Section 2 of this Agreement:


 


(a) This
Agreement constitutes a legal, valid and binding obligation of such Purchaser, enforceable against such Purchaser in accordance
with its terms, except as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, moratorium or similar
laws or by legal or equitable principles related to or limiting creditors’ rights generally.


 


(b) Such
Purchaser has the corporate or individual power and authority to enter into this Agreement and the transactions contemplated hereby
have been duly authorized by all necessary corporate action of such Purchaser (including the approval of each member of the Company’s
board of directors other than Christopher Hughes, who abstained).


 






    2


     


    

 


(c) As
of the date hereof, there is no suit, action investigation or proceeding pending or, to the knowledge of such Purchaser, threatened
against such Purchaser, that could materially impair the ability of such Purchaser to perform its obligations hereunder or to consummate
the transactions contemplated hereby.


 


(d) The
execution, delivery and performance of this Agreement by such Purchaser and the consummation of the transactions contemplated hereby
will not result in a breach or violation by such Purchaser of, or constitute a default by such Purchaser under, any judgment, decree,
order, governmental permit, license, agreement, indenture, instrument, statute, rule or regulation to which it is a party or by
which it is bound, other than any breach, violation or default that would not materially impair the ability of the such Purchaser
to perform its obligations under this Agreement or to consummate the transactions contemplated hereby, and no authorization, approval
or consent, except such as have been obtained, is required in connection with the execution, delivery and performance by such Purchaser
of this Agreement or the consummation of the transactions contemplated hereby.


 


(e) The
Company has received advice from an independent, third-party valuation firm indicating that the price per share in Section 1(b)
represents fair value.


 


5. Seller
Acknowledgment. Each Seller acknowledges and understands that the Purchasers may have confidential information that may constitute
material non-public information not known to such Seller that may impact the value of the Shares. Notwithstanding this, such Seller
has deemed it appropriate to sell the Shares to the Purchasers. Each Seller agrees that the Purchasers shall have no liability
to such Seller whatsoever due to or in connection with the Purchasers’ use or non-disclosure of such information or otherwise
as a result of the sale of the Shares to the Purchasers, and such Seller hereby irrevocably waives any claim that it might have
based on the failure of the Purchasers to disclose any such information.


 


6. Survival
of Representations, Warranties and Covenants. The representations and warranties contained in Section 3(a) of this Agreement
and the Seller acknowledgement in Section 5 shall survive the consummation of the transactions contemplated hereby. All
other representations, warranties and covenants contained herein shall not survive the consummation of the transactions contemplated
hereby.


 


7. Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs,
representatives, successors and assigns.


 


8. Severability.
In the event that any portion of this Agreement may be held to be invalid or unenforceable for any reason, it is hereby agreed
that such invalidity or unenforceability shall not affect the other portions of this Agreement and that the remaining covenants,
terms and conditions or portions hereof shall remain in full force and effect, and any court of competent jurisdiction may so modify
the objectionable provision as to make it valid, reasonable and enforceable.


 


9. Entire
Agreement. This Agreement, together with the Settlement Agreement, contains the complete agreement among the parties hereto
with respect to the transactions contemplated hereby and supersedes all prior agreements and understandings among the parties hereto
with respect to such transactions.


 






    3


     


    

 


10. Governing
Law. This Agreement shall be construed in accordance with, and governed in all respects by, the internal laws of the State
of Delaware (without giving effect to principles of conflicts of laws).  Any legal proceeding relating to this Agreement or
the enforcement of any provision of this Agreement shall be commenced in the Court of Chancery of the State of Delaware (or, if
any such court declines to accept jurisdiction over a particular matter, any state or federal court located in Delaware). 
Each Party: (i) expressly and irrevocably consents and submits to the jurisdiction of each state and federal court located in Delaware
(and each appellate court related thereto) in connection with any such legal proceeding; (ii) agrees that each state and federal
court located in Delaware shall be deemed to be a convenient forum; and (iii) agrees not to assert (by way of motion, as a defense
or otherwise), in any such legal proceeding commenced in any state or federal court located in Delaware, any claim that such Party
is not subject personally to the jurisdiction of such court, that such legal proceeding has been brought in an inconvenient forum,
that the venue of such proceeding is improper or that this Agreement or the subject matter of this Agreement may not be enforced
in or by such court.  EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY CLAIM, ACTION, SUIT OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT. EACH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY CLAIM, ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(II) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.


 


11. Counterparts.
This Agreement may be executed by facsimile or electronic signature and in two or more counterparts, each of which shall be deemed
an original but all of which shall constitute but one instrument.


 


12. Remedies.
In the event that the Purchasers do not provide the Closing Notice, the remedies available to Sellers hereunder shall be limited
to those remedies described in Section 3(e) of the Settlement Agreement being entered into concurrently herewith.


 


[Remainder of page intentionally left
blank. Signature page follows.]


 




    4


     


    

 


IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the date first above written.


 


	 	TSR, Inc.
	 	 	 
	 	By:	 
	 	 	 
	 	Name:	 
	 	 	 
	 	Title:	 
	 	 	 
	 	Christopher Hughes
	 	 	 
	 		 
	 	 	 
	 	Zeff Capital, L.P.
	 	 	 
	 	By:	 
	 	 	 
	 	Name:	 
	 	 	 
	 	Title:	 
	 	 	 
	 	Daniel Zeff
	 	 	 
	 		 
	 	 	 
	 	QAR Industries, Inc.
	 	 	 
	 	By:	                   
	 	 	 
	 	Name:	 
	 	 	 
	 	Title:	 
	 	 	 
	 	Robert Fitzgerald
	 	 	 
	 		 


 


[Signature Page to Share Repurchase Agreement]


 






     


     


    

 


	 	Fintech Consulting, LLC
	 	 	 
	 	By:	                   
	 	 	 
	 	Name:	 
	 	 	 
	 	Title:	 
	 	 	 
	 	Tajuddin Haslani
	 	 	 
	 		 


 


[Signature Page to Share Repurchase
Agreement]


 




     


     


    

 


Schedule A


 


	Seller	 	Shares Sold
	 	 	 
	Zeff Capital, L.P.	 	437,774
	 	 	 
	QAR Industries, Inc.	 	139,200
	 	 	 
	Fintech Consulting, LLC	 	376,000
	 	 	 
	Tajuddin Haslani	 	100



 


	Purchaser	 	Shares Purchased
	 	 	 
	TSR, Inc.	 	633,074
	 	 	 
	Christopher Hughes	 	320,000



 






     


     


    

 


Exhibit B


 


Bylaw Amendment


 


AMENDMENT NO. 2


TO AMENDED AND RESTATED BY-LAWS


OF TSR, INC.


 


The text of Article
II, Section 5 of the Amended and Restated By-laws (as amended by Amendment No. 1 to the Amended and Restated By-laws) of TSR, Inc.,
which had been previously stated as follows:


 


“Section 5.
Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the certificate
of incorporation, may be called by the president and shall be called by the president or secretary at the request in writing of
a majority of the board of directors. Such request shall state the purpose or purposes of the proposed meeting.”


 


was amended to read as follows:


 


“Section 5.
Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the certificate
of incorporation, may be called by the president and shall be called by the president or secretary at the request in writing of
a majority of the board of directors, or at the request in writing of stockholders owning at least forty percent (40%) in amount
of the entire capital stock of the corporation issued and outstanding and entitled to vote. Such request shall state the purpose
or purposes of the proposed meeting.”


 


Approved: ______________________


 






     


     


    

 


Exhibit C 


 


Rights Plan Amendment


 





 



 




AMENDED & RESTATED RIGHTS AGREEMENT


 


by and between


 


TSR, INC.


 


and


 


CONTINENTAL STOCK TRANSFER & TRUST COMPANY


 


as Rights Agent


 


Dated as of


 


August 29, 2018


 


and Amended and Restated as of


 


________________, 2019


 





 



 



     


     


    

 


TABLE OF CONTENTS


 


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







 


	Exhibit A	Summary of Rights
	 	 
	Exhibit B	Form of Rights Certificate
	 	 
	Exhibit C	Form of Certificate of Designations Relating to the Terms of the Class A Preferred Stock, Series One




 




     


     


    

 


AMENDED & RESTATED RIGHTS AGREEMENT


 


This AMENDED & RESTATED RIGHTS AGREEMENT
(this “Rights Agreement”) is dated as of August
29, 2018 and amended and restated as of September 3, 2019, by and between TSR, INC., a Delaware corporation (the “Corporation”),
and CONTINENTAL STOCK TRANSFER & TRUST COMPANY (the “Rights Agent”).


 


W I T N E S S E T H:


 


WHEREAS, on August
29, 2018, the Board of Directors of the Corporation authorized the issuance of, and declared a dividend payable in, one
right (a “Right”) for each share of Common Stock, $0.01 par value per share, of the Corporation outstanding
as of the close of business on August 29, 2018 (the “Record
Date”), each such Right representing the right to purchase one one-hundredth of a share of Class A Preferred Stock,
Series One of the Corporation (the “Preferred Stock”) having the rights and preferences set forth in
the Certificate of Designations attached hereto as Exhibit C, authorized by the Board of Directors on August
29, 2018, upon the terms and subject to the conditions hereinafter set forth;


 


WHEREAS, the Board of Directors of
the Corporation further authorized the issuance of one Right (subject to adjustment) with respect to each share of Common Stock
which may be issued between the Record Date and the earlier to occur of the Distribution Date or the Expiration Date (as such terms
are hereinafter defined); and


 


WHEREAS, on August 30, 2019, the Corporation
entered into a Settlement and Release Agreement (the “Settlement Agreement”) with Zeff Capital, L.P.
(“Zeff Capital”), Zeff Holding Company, LLC (“Zeff Holding”) and Daniel Zeff
(together with Zeff Capital and Zeff Holding, the “Zeff Parties”), QAR Industries, Inc. (“QAR”)
and Robert Fitzgerald (together with QAR, the “QAR Parties”), and Fintech Consulting, LLC (“Fintech”)
and Tajuddin Haslani (together with Fintech, the “Fintech Parties” and the Fintech Parties together with
the Zeff Parties and the QAR Parties, the “Investor Parties”) pursuant to which the Corporation agreed
to amend and restate this Rights Agreement to confirm that a Distribution Date shall not occur as a result of any request by any
of the Investor Parties calling for a special meeting pursuant to Article II, Section 5 of the Amended and Restated By-Laws of
the Corporation (as amended, including by Amendment No. 2 to the Amended and Restated By-Laws, the “By-Laws”)
in accordance with the Settlement Agreement;


 






    1


     


    

 


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


 


Section 1. Certain Definitions.


 


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


 


(a) “Acquiring
Person” shall mean any Person who or which, together with all Affiliates and Associates of such Person and any other
Person with whom such Person is Acting in Concert, shall be the Beneficial Owner of 5% or more of the Corporation’s Common
Stock then outstanding, but shall not include (i) an Exempt Person or (ii) any Person who or which, at the time of the
first public announcement of this Rights Agreement, is a Beneficial Owner of 5% or more of the Corporation’s Common Stock
then outstanding (a “Grandfathered Stockholder”); provided, however, that if a Grandfathered
Stockholder becomes, after such time, the Beneficial Owner of any additional shares of the Corporation’s Common Stock (regardless
of whether, thereafter or as a result thereof, there is an increase, decrease or no change in the percentage of shares of the Corporation’s
Common Stock then outstanding beneficially owned by such Grandfathered Stockholder) then such Grandfathered Stockholder shall be
deemed to be an Acquiring Person unless, upon such acquisition of Beneficial Ownership of additional shares of the Corporation’s
Common Stock, such Person is not the Beneficial Owner of 5% or more of the Corporation’s Common Stock then outstanding; provided,
further, that upon the first decrease of a Grandfathered Stockholder’s Beneficial Ownership below 5%, such Grandfathered
Stockholder shall cease to be a Grandfathered Stockholder and this clause (ii) shall have no further force or effect with
respect to such Person. For the avoidance of doubt, in the event that after the time of the first public announcement of this Rights
Agreement, any agreement, arrangement or understanding pursuant to which any Grandfathered Stockholder is deemed to be the Beneficial
Owner of shares of the Corporation’s Common Stock expires, terminates or no longer confers any benefit to or imposes any
obligation on the Grandfathered Stockholder, any direct or indirect replacement, extension or substitution of such agreement, arrangement
or understanding with respect to the same or different shares of the Corporation’s Common Stock that confers Beneficial Ownership
of shares of the Corporation’s Common Stock shall be considered the acquisition of Beneficial Ownership of additional shares
of the Corporation’s Common Stock by the Grandfathered Stockholder and render such Grandfathered Stockholder an Acquiring
Person for purposes of this Rights Agreement unless, upon such acquisition of Beneficial Ownership of additional shares of the
Corporation’s Common Stock, such Person is not the Beneficial Owner of 5% or more of the Corporation’s Common Stock
then outstanding.


 


Notwithstanding the foregoing, no Person shall
become an Acquiring Person as the result of an acquisition of shares of the Corporation’s Common Stock which, by reducing
the number of shares outstanding, increases the proportionate number of shares beneficially owned by such Person to 5% (or such
other percentage as would otherwise result in such Person becoming an Acquiring Person) or more of the Corporation’s Common
Stock then outstanding; provided, however, that if a Person would, but for the provisions of this paragraph, become
an Acquiring Person by reason of an acquisition of shares of the Corporation’s Common Stock by the Corporation and shall,
after such share purchases by the Corporation, become the Beneficial Owner of any additional shares of the Corporation’s
Common Stock at any time such that the Person is or thereby becomes the Beneficial Owner of 5% (or such other percentage as would
otherwise result in such Person becoming an Acquiring Person) or more of the Corporation’s Common Stock then outstanding
(other than shares of Common Stock acquired solely as a result of corporate action of the Corporation not caused, directly or indirectly,
by such Person), then such Person shall be deemed to be an Acquiring Person.


 






    2


     


    

 


Notwithstanding the foregoing paragraphs of
this Section 1(a), if the Board of Directors determines in good faith that a Person who would otherwise be an Acquiring
Person has become such inadvertently, and such Person divests as promptly as practicable a sufficient number of shares of the Corporation’s
Common Stock so that such Person would no longer be an Acquiring Person, then such Person shall not be deemed to have become an
Acquiring Person. Notwithstanding the foregoing, if a bona fide swaps dealer who would otherwise be an “Acquiring Person”
has become so as a result of its actions in the ordinary course of its business that the Board of Directors determines, in its
sole discretion, were taken without the intent or effect of evading or assisting any other Person to evade the purposes and intent
of this Rights Agreement, or otherwise seeking to control or influence the management or policies of the Corporation, then, and
unless and until the Board of Directors shall otherwise determine, such Person shall not be deemed to be an “Acquiring Person.”


 


(b) A
Person shall be deemed to be “Acting in Concert” with another Person if such Person knowingly acts (whether
or not pursuant to an express agreement, arrangement or understanding) in concert or in parallel with such other Person, or towards
a common goal with such other Person, relating to (i) acquiring, holding, voting or disposing of voting securities of the
Corporation or (ii) changing or influencing the control of the Corporation or in connection with or as a participant in any
transaction having that purpose or effect, where (A) each Person is conscious of the other Person’s conduct or intent
and this awareness is an element in their decision-making processes and (B) at least one additional factor supports a determination
by the Board of Directors that such Persons intended to act in concert or in parallel, which such additional factors may include,
without limitation, exchanging information, attending meetings, conducting discussions, or making or soliciting invitations to
act in concert or in parallel. A Person who is Acting in Concert with another Person shall also be deemed to be Acting in Concert
with any third Person who is also Acting in Concert with such other Person.


 


(c)
“Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as in effect on the date of this Rights
Agreement.


 


(d) “Associate”
of a Person (as such term is hereinafter defined) shall mean (i) with respect to a corporation, any officer or director thereof
or of any Subsidiary (as such term is hereinafter defined) thereof, or any Beneficial Owner (as such term is hereinafter defined)
of 10% or more of any class of equity security thereof, (ii) with respect to an association, joint venture or other unincorporated
organization, any officer or director thereof or of a Subsidiary thereof or any Beneficial Owner of 10% or more ownership interest
therein, (iii) with respect to a partnership, any general partner thereof or any limited partner thereof who is, directly or indirectly,
the Beneficial Owner of a 10% or greater ownership interest therein, (iv) with respect to a limited liability company, any officer,
director or manager thereof or of a Subsidiary thereof or any member thereof who is, directly or indirectly, the Beneficial Owner
of a 10% or greater ownership interest therein, (v) with respect to a business trust, any officer or trustee thereof or of any
Subsidiary thereof, (vi) with respect to any other trust or an estate, any trustee, executor or similar fiduciary or any Person
who has a 10% or greater interest as a beneficiary in the income from or principal of such trust or estate, (vii) with respect
to a natural person, any relative or spouse of such person, or any relative of such spouse, who has the same home as such person,
and (viii) any Affiliate of such Person.


 






    3


     


    

 


(e) A
Person shall be deemed the “Beneficial Owner” of, or to “Beneficially Own,”
any securities (and correlative terms shall have correlative meanings):


 


(i) which
such Person or any of such Person’s Affiliates or Associates beneficially owns, directly or indirectly, within the meaning
of Rules 13d-3 or 13d-5 promulgated under the Exchange Act, as in effect on the date of this Agreement;


 


(ii) which
such Person or any of such Person’s Affiliates or Associates has (A) the right or ability to vote, cause to be voted
or control or direct the voting of pursuant to any agreement, arrangement or understanding, whether or not in writing; provided,
however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially own, any security if the agreement,
arrangement or understanding to vote such security (x) 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 (y) is not also then reportable on a statement on Schedule 13D under the Exchange
Act (or any comparable or successor report) or (B) the right or the obligation to become the Beneficial Owner (whether such
right is exercisable or such obligation is required to be performed immediately or only after the passage of time, the occurrence
of conditions or the satisfaction of regulatory requirements) pursuant to any agreement, arrangement or understanding, whether
or not in writing (other than customary agreements with and between underwriters and selling group members with respect to a bona
fide public offering of securities), written or otherwise, or upon the exercise of conversion rights, exchange rights, rights (other
than the Rights), warrants or options, or otherwise, through conversion of a security, pursuant to the power to revoke a trust,
discretionary account or similar arrangement, pursuant to the power to terminate a repurchase or similar so-called “stock-borrowing”
agreement or arrangement, or pursuant to the automatic termination of a trust, discretionary account or similar arrangement; provided,
however, that a Person shall not be deemed to be the Beneficial Owner of, or to beneficially own, securities tendered pursuant
to a tender or exchange offer made pursuant to, and in accordance with, the applicable rules and regulations promulgated under
the Exchange Act until such tendered securities are accepted for purchase or exchange; or


 


(iii) which
are beneficially owned (within the meaning of the preceding subsections of this Section 1(e), directly or indirectly,
by any other Person with which such Person or any of such Person’s Affiliates or Associates (A) has any agreement, arrangement
or understanding, whether or not in writing, for the purpose of acquiring, holding, voting or disposing of any securities of the
Corporation or cooperating in obtaining, changing or influencing the control of the Corporation or (B) is Acting in Concert;
or


 


(iv) which
are the subject of, or the reference securities for, or that underlie, any Derivative Position of such Person or any of such Person’s
Affiliates or Associates or any other Person with whom such Person is Acting in Concert, with the number of shares of Common Stock
deemed beneficially owned in respect of a Derivative Position being the notional or other number of shares of Common Stock in respect
of such Derivative Position (without regard to any short or similar position) that is specified in (A) one or more filings
with the Securities and Exchange Commission by such Person or any of such Person’s Affiliates or Associates or any other
Person with whom such Person is Acting in Concert or (B) the documentation evidencing such Derivative Position as the basis
upon which the value or settlement amount of such Derivative Position, or the opportunity of the holder of such Derivative Position
to profit or share in any profit, is to be calculated in whole or in part (whichever of (A) or (B) is greater), or if
no such number of shares of Common Stock is specified in such filings or documentation (or such documentation is not available
to the Board of Directors ), as determined by the Board of Directors in its reasonable discretion.


 






    4


     


    

 


Notwithstanding anything in this paragraph
(e) to the contrary, a Person engaged in the business of underwriting securities shall not be deemed the “Beneficial Owner”
of, or to “Beneficially Own,” any securities acquired in good faith in a firm commitment underwriting, until the expiration
of forty days after the date of such acquisition.


 


(f) “Book-Entry”
shall mean an uncertificated book-entry for the Corporation's Common Stock.


 


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


 


(h) “Close
of Business” on any given date shall mean 5:00 p.m., New York City time, on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 p.m., New York City time, on the next succeeding Business Day.


 


(i) “Common
Stock,” when used with reference to the Corporation, shall mean the common stock, $0.01 par value, of the Corporation.
“Common Stock,” when used with reference to any Person other than the Corporation which shall be organized in corporate
form, shall mean the capital stock or other equity security with the greatest voting power of such Person. “Common Stock,”
when used with reference to any Person other than the Corporation which shall not be organized in corporate form, shall mean units
of beneficial interest which shall represent the right to participate in profits, losses, deductions and credits of such Person
and which shall be entitled to exercise the greatest voting power of such Person.


 


(j) “Derivative
Position” shall mean any option, warrant, convertible security, stock appreciation right, or other security, contract
right or derivative position or similar right (including any “swap” transaction with respect to any security, other
than a broad based market basket or index), whether or not presently exercisable, that has an exercise or conversion privilege
or a settlement payment or mechanism at a price related to the value of the Common Stock or a value determined in whole or in part
with reference to, or derived in whole or in part from, the value of the Common Stock and that increases in value as the market
price or value of the Common Stock increases or that provides an opportunity, directly or indirectly, to profit or share in any
profit derived from any increase in the value of the Common Stock, in each case regardless of whether (i) it conveys any voting
rights in such Common Stock to any Person, (ii) it is required to be, or capable of being, settled through delivery of Common
Stock or (iii) any Person (including the holder of such Derivative Position) may have entered into other transactions that
hedge its economic effect.


 


(k)
“Distribution Date” shall have the meaning set forth in Section 3(b) hereof.


 


(l) “Exchange
Act” shall have the meaning set forth in Section 1(b) hereof.


 


(m) “Exempt
Person” shall mean (i) the Corporation, (ii) any Subsidiary of the Corporation, or (iii) any employee benefit plan
or employee stock plan of the Corporation or any Subsidiary of the Corporation, or any trust or other entity organized, appointed,
established or holding Common Stock for or pursuant to the terms of any such plan.


 






    5


     


    

 


(n) “Exercise
Price” shall have the meaning set forth in Section 4 and Section 7(b) hereof.


 


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


 


(p) “Fair
Market Value” of any property shall mean the fair market value of such property as determined in accordance with
Section 11(b) hereof.


 


(q) “Person”
shall mean any individual, firm, corporation or other entity.


 


(r) “Principal
Party” shall have the meaning set forth in Section 13(b) hereof.


 


(s) “Record
Date” shall have the meaning set forth in the first Recital hereof.


 


(t) “Redemption
Price” shall have the meaning set forth in Section 23(a) hereof.


 


(u) “Rights
Certificate” shall have the meaning set forth in Section 3(d) hereof.


 


(v) “Stock
Acquisition Date” shall mean the first date on which there shall be a public announcement by the Corporation or an
Acquiring Person that an Acquiring Person has become such (which, for purposes of this definition, shall include, without limitation,
a report filed pursuant to Section 13(d) of the Exchange Act) or such earlier date as a majority of the Board of Directors shall
become aware of the existence of an Acquiring Person.


 


(w) “Subsidiary”
of a Person shall mean any corporation or other entity of which such Person Beneficially Owns at least 50% of the outstanding voting
securities.


 


(x) “Summary
of Rights” shall have the meaning set forth in Section 3(a) hereof.


 


(y) “Trading
Day” shall have the meaning set forth in Section 11(b) hereof.


 


(z) “Transfer
Tax” shall mean any tax or charge, including any documentary stamp tax, imposed or collected by any governmental
or regulatory authority, in respect of any transfer of any security, instrument or right, including Rights, shares of Common Stock
and shares of Preferred Stock.


 


Any determination required to be made by
the Board of Directors of the Corporation for purposes of applying the definitions contained in this Section 1 shall be
made by the Board of Directors in its good faith judgment, and such determination shall be binding on the Rights Agent and the
holders of the Rights.


 


Section 2. Appointment of Rights Agent.


 


The Corporation hereby appoints the Rights
Agent to act as agent for the Corporation and the holders of the Rights 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, upon ten (10) days’ prior written notice to the Rights Agent. The Rights Agent shall have
no duty to supervise, and shall in no event be liable for, the acts or omissions of any such co-rights agent. In the event the
Corporation appoints one or more Co-Rights Agents, the respective duties of the Rights Agent and any Co-Rights Agent shall be as
the Corporation shall reasonably determine, provided that such duties and determination are consistent with the terms and provisions
of this Agreement and that contemporaneously with such appointment, if any, the Corporation shall notify the Rights Agent in writing
thereof.


 






    6


     


    

 


Section 3. Issuance of Rights Certificates.


 


(a) On
the Record Date (or as soon as practicable thereafter), the Corporation or the Rights Agent shall send a copy of a Summary of Rights,
in substantially the form attached hereto as Exhibit A (the “Summary of Rights”), by first class
mail, postage prepaid, to each record holder of the 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.


 


(b) Until
the Close of Business on the day which is the earlier of (i) the tenth day after the Stock Acquisition Date or such earlier or
later date (not beyond the thirtieth day after the Stock Acquisition Date) as the Board of Directors may from time to time fix
by resolution adopted prior to the Distribution Date that otherwise would have occurred or (ii) the tenth business day (or such
later date as may be determined by action of the Board of Directors prior to such time as any Person becomes an Acquiring Person)
after the date of the commencement by any Person (other than an Exempt Person) of, or the first public announcement of the intent
of any Person (other than an Exempt Person) to commence, a tender or exchange offer upon the successful consummation of which such
Person, together with its Affiliates and Associates and Persons with whom such Person is Acting in Concert, would be the Beneficial
Owner of 5% or more of the then-outstanding shares of the Corporation’s Common Stock (irrespective of whether any shares
are actually purchased pursuant to any such offer) (the earlier of such dates being herein referred to as the “Distribution
Date”); provided, however, that if such 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, (x) the Rights shall
be evidenced by the Book-Entries, or certificates for, Common Stock registered in the name of the holders of Common Stock (together
with, in the case of Book-Entries representing, or the certificates for, Common Stock outstanding as of the Record Date, the Summary
of Rights) and not by separate Book-Entries or Rights Certificates and the record holders of the Common Stock represented by such
Book-Entries or certificates shall be the record holders of the Rights represented thereby and (y) each Right shall be transferable
only simultaneously and together with the transfer of shares of Common Stock (subject to adjustment as hereinafter provided). Notwithstanding
the foregoing, a Distribution Date shall not occur solely as a result of any request by any of the Investor Parties calling for
a special meeting pursuant to the By-Laws in accordance with the Settlement Agreement. Until the Distribution Date (or, if earlier,
the Expiration Date), transfer on the Corporation’s direct registration system of any Common Stock represented by a Book-Entry
or the surrender for transfer of any certificate for Common Stock shall constitute the surrender for transfer of the Right or Rights
associated with the Common Stock evidenced thereby, whether or not accompanied by a copy of the Summary of Rights.


 






    7


     


    

 


(c) Rights
shall be issued in respect of all shares of Common Stock that become outstanding after the Record Date but prior to the earlier
of the Distribution Date or the Expiration Date and, in certain circumstances provided in Section 22 hereof, may be issued
in respect of shares of Common Stock that become outstanding after the Distribution Date. Certificates for Common Stock (including,
without limitation, certificates issued upon original issuance, dispensation from the Corporation’s treasury or transfer
or exchange of Common Stock) after the Record Date but prior to the earliest of the Distribution Date or the Expiration Date (or,
in certain circumstances as provided in Section 22 hereof, after the Distribution Date) shall have impressed, printed, written
or stamped thereon or otherwise affixed thereto the following legend:


 


This certificate also evidences
and entitles the holder hereof to the same number of Rights (subject to adjustment) as the number of shares of Common Stock represented
by this certificate, such Rights being on the terms provided under the Rights Agreement between TSR, Inc. (the “Corporation”)
and Continental Stock Transfer & Trust Company (the “Rights Agent”), dated as of August
29, 2018, as it may be amended from time to time (the “Rights Agreement”), the terms of which are incorporated
herein by reference and a copy of which is on file at the principal executive offices of the Corporation. Under certain circumstances,
as set forth in the Rights Agreement, such Rights shall be evidenced by separate certificates and shall no longer be evidenced
by this certificate. The Corporation shall mail to the registered holder of this certificate a copy of the Rights Agreement without
charge within five days after receipt of a written request therefor. UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN SECTION 11(a)(ii)
OF THE RIGHTS AGREEMENT, RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR AFFILIATES OR ASSOCIATES OR PERSONS
WITH WHOM SUCH PERSONS ARE ACTING IN CONCERT (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.


 


(d) 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 (and the Rights Agent will, if requested, send), by first class mail, postage prepaid,
to each record holder of the Common Stock as of the Close of Business on the Distribution Date, as shown by the records of the
Corporation, at the address of such holder shown on such records, a certificate in the form provided by Section 4 hereof
(a “Rights Certificate”), evidencing one Right (subject to adjustment as provided herein) for each share
of Common Stock so held; provided, however, that the Rights may instead be recorded in Book-Entry or other uncertificated
form, in which case such Book-Entries or other evidence of ownership shall be deemed to be Rights Certificates for all purposes
of this Rights Agreement ; provided, further, that all procedures relating to actions to be taken or information
to be provided with respect to such Rights recorded in Book-Entry or other uncertificated forms, and all requirements with respect
to the form of any Rights Certificate set forth in this Rights Agreement, may be modified as necessary or appropriate to reflect
Book-Entry or other uncertificated ownership. As of and after the Distribution Date, the Rights shall be evidenced solely by such
Rights Certificates and may be transferred by the transfer of the Rights Certificate as permitted hereby, separately and apart
from any transfer of one or more shares of Common Stock.


 






    8


     


    

 


(e) In
addition, in connection with the issuance or sale of shares of Common Stock following the Distribution Date and prior to the Expiration
Date, the Corporation (i) shall, with respect to shares of Common Stock so issued or sold (x) pursuant to the exercise of stock
options or under any employee plan or arrangement or (y) upon the exercise, conversion or exchange of other securities issued by
the Corporation prior to the Distribution Date and (ii) may, in any other case, if deemed necessary or appropriate by the Board
of Directors of the Corporation, issue Rights certificates representing the appropriate number of Rights in connection with such
issuance or sale; provided that no such Rights Certificate shall be issued if, and to the extent that, (i) the Corporation
shall be advised by counsel that such issuance would create a significant risk of material adverse tax consequences to the Corporation
or the Person to whom such Rights Certificate would be issued or (ii) appropriate adjustment shall otherwise have been made in
lieu of the issuance thereof.


 


Section 4. Form of Rights Certificates.


 


(a) The
Rights Certificates (and the forms of election to purchase shares and of assignment to be printed on the reverse thereof), when,
as and if issued, 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 may be required to comply with any law or with any
rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Common Stock or the
Rights may from time to time be listed or as the Corporation may deem appropriate to conform to usage or otherwise and as are not
inconsistent with the provisions of this Rights Agreement (but which do not affect the rights, duties, liabilities or responsibilities
of the Rights Agent). Subject to the provisions of Section 22 hereof, Rights Certificates evidencing Rights whenever issued,
(i) shall be dated as of the date of issuance of the Rights they represent and (ii) subject to adjustment from time to time as
provided herein, on their face shall entitle the holders thereof to purchase such number of shares (including fractional shares
which are integral multiples of one one-hundredth of a share) of Preferred Stock as shall be set forth therein at the price payable
upon exercise of a Right provided by Section 7(b) hereof as the same may from time to time be adjusted as provided herein
(the “Exercise Price”).


 


(b) Notwithstanding
any other provision of this Rights Agreement, any Rights Certificate that represents Rights Beneficially Owned by an Acquiring
Person or any Affiliate or Associate thereof or any other Person whose Rights shall become void pursuant to Section 11(a)(ii)
shall have impressed on, printed on, written on or otherwise affixed to it (if the Corporation or the Rights Agent has knowledge
that such Person is an Acquiring Person or an Associate or Affiliate or a nominee of any of the foregoing) the following legend:


 


The Beneficial Owner of the
Rights represented by this Rights Certificate is an Acquiring Person or an Affiliate or an Associate of an Acquiring Person. Accordingly,
this Rights Certificate and the Rights represented hereby shall become void in the circumstances specified in Section 11(a)(ii)
of the Rights Agreement.


 






    9


     


    

 


Section 5. Countersignature and Registration.


 


(a) Each
Rights Certificate shall be executed on behalf of the Corporation by its Chairman of the Board, Chef Executive Officer, President
or any Vice President, either manually or by facsimile signature, and have affixed thereto the Corporation’s seal or a facsimile
thereof which shall be attested to by the Secretary or an Assistant Secretary of the Corporation, either manually or by facsimile
signature. Each Rights Certificate shall be countersigned by the Rights Agent either manually or by facsimile signature and shall
not be valid for any purpose unless so countersigned. In case any officer of the Corporation who shall have signed any Rights Certificate
shall cease to be such officer of the Corporation before countersignature by the Rights Agent and issuance and delivery of the
certificate by the Corporation, such Rights Certificate, nevertheless, may be countersigned by the Rights Agent and issued and
delivered with the same force and effect as though the person who signed such Rights Certificate had not ceased to be such officer
of the Corporation. Any Rights Certificate may be signed on behalf of the Corporation by any person who, on the date of the execution
of such Rights Certificate, shall be a proper officer of the Corporation to sign such Rights Certificate, although at the date
of the execution of this Rights Agreement any such person was not such an officer.


 


(b) Following
the Distribution Date, the Rights Agent will keep or cause to be kept, at its principal office or one or more offices designated
as the appropriate place for the surrender of Rights Certificates upon exercise or transfer, and in such other locations as may
be required by law, books for registration and transfer of the Rights Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Rights Certificates, the number of Rights evidenced on its face by each of
the Rights Certificates and the date of each of the Rights Certificates and any Rights Certificates that have a legend printed
thereon pursuant to Section 4(b).


 


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


 


(a) Subject
to the provisions of Section 11(a)(ii), Section 7(e) and Section 14(b) hereof, at any time after the Close
of Business on the Distribution Date, and at or prior to the Close of Business on the Expiration Date, any Rights Certificate (other
than a Rights Certificate representing Rights that have become void pursuant to Section 11(a)(ii) or that have been exchanged
pursuant to Section 27) may be (i) transferred or (ii) split up, combined or exchanged for one or more other Rights Certificates,
entitling the registered holder to purchase a like number of shares of Preferred Stock as the Rights Certificate or Rights Certificates
surrendered then entitled such holder to purchase. Any registered holder desiring to transfer any Rights Certificate shall surrender
the Rights Certificate at the office of the Rights Agent designated for the surrender of Rights Certificates with the form of certificate
and assignment on the reverse side thereof duly endorsed (or, enclosed with such Rights Certificate, a written instrument of transfer
in a form satisfactory to the Corporation and the Rights Agent), duly executed by the registered holder thereof or his attorney
duly authorized in writing, and with such signature duly guaranteed. Any registered holder desiring to split up, combine or exchange
any Rights Certificate shall make such request in writing delivered to the Rights Agent, and shall surrender the Rights Certificate
to be split up, combined or exchanged at the office of the Rights Agent. Thereupon, the Rights Agent shall countersign and deliver
to the person entitled thereto a Rights Certificate or Rights Certificates, as the case may be, as so requested. The Corporation
or the Rights Agent may require payment from the holders of the Rights Certificates of a sum sufficient to cover any Transfer Tax
that may be imposed in connection with any transfer, split up, combination or exchange of any Rights Certificates. The Rights Agent
shall not have any duty or obligation to take any action under any section of this Rights Agreement that requires payment of taxes
and/or charges unless and until it is satisfied that all such payments have been made.


 






    10


     


    

 


(b) Subject
to the provisions of Section 11(a)(ii), Section 7(e) and Section 14(b) hereof, upon receipt by the Corporation
and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Rights Certificate
and the identity of the Beneficial Owner (or former Beneficial Owner) thereof including a signature guarantee and such other documentation
as the Rights Agent may reasonably request), and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory
to them and, if requested by the Corporation, reimbursement to the Corporation and the Rights Agent of all reasonable expenses
incidental thereto, or upon surrender to the Rights Agent and cancellation of the Rights Certificate if mutilated, the Corporation
shall issue and deliver a new Rights Certificate of like tenor to the Rights Agent for delivery to the registered owner in lieu
of the Rights Certificate so lost, stolen, destroyed or mutilated.


 


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


 


(a) The
Rights shall not be exercisable until, and shall become exercisable on, the Distribution Date (unless otherwise provided herein,
including, without limitation, the restrictions on exercisability set forth in Section 11(a)(ii) and Section 23(a)
hereof). Except as otherwise provided herein, the Rights may be exercised, in whole or in part, at any time commencing with the
Distribution Date upon surrender of the Rights Certificate, with the form of election to purchase and certificate on the reverse
side thereof duly executed (with signatures duly guaranteed), to the Rights Agent at the principal office of the Rights Agent in
New York, New York together with payment of the Exercise Price for each Right exercised, subject to adjustment as hereinafter provided,
at or prior to the Close of Business on the earlier of (i) August 29, 2021 (or if the Distribution Date shall have occurred before
August 29, 2021, at the Close of Business on the 90th day following the Distribution Date) or (ii) the date on which the Rights
are redeemed as provided in Section 23 hereof (such earlier date being herein referred to as the “Expiration
Date”).


 


(b) The
Exercise Price shall initially be $24.78 for each one one-hundredth (1/100th) of a share of Preferred Stock issued pursuant to
the exercise of a Right. The Exercise Price and the number of shares of Preferred Stock or other securities to be acquired upon
exercise of a Right shall be subject to adjustment from time to time as provided in Section 11 and Section 13 hereof.
The Exercise Price shall be payable in lawful money of the United States of America, in accordance with paragraph (c) below.


 






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(c) Except
as otherwise provided herein, upon receipt of a Rights Certificate representing exercisable Rights with the form of election to
purchase duly executed, accompanied by payment by certified check, cashier’s check, bank draft or money order payable to
the Corporation or the Rights Agent of the Exercise Price for the shares to be purchased and an amount equal to any applicable
Transfer Tax required to be paid by the holder of the Rights Certificate in accordance with Section 9(e) hereof, the Rights
Agent shall thereupon promptly (i)(A) requisition from any registrar or transfer agent (as may be appropriate) of the Preferred
Stock of the Corporation one or more certificates representing the number of shares of Preferred Stock to be so purchased, and
the Corporation hereby authorizes and directs such registrar or transfer agent (as may be appropriate) to comply with all such
requests or (B) requisition from any depositary agent for the Preferred Stock of the Corporation depositary receipts representing
such number of shares of Preferred Stock to be so purchased (in which case certificates for the shares of Preferred Stock represented
by such receipts shall be deposited by the transfer agent with the depositary agent), and the Corporation hereby directs any such
depositary agent to comply with such request, (ii) as provided in Section 14(b), at the election of the Corporation, cause
depositary receipts to be issued in lieu of fractional shares of Preferred Stock, (iii) if the election provided for in the immediately
preceding clause (ii) has not been made, requisition from the Corporation the amount of cash to be paid in lieu of the issuance
of fractional shares in accordance with Section 14(b) hereof, (iv) after receipt of such Preferred Stock certificates and,
if applicable, depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such holder and (v) when appropriate, after receipt, promptly
deliver such cash to or upon the order of the registered holder of such Rights Certificate; provided, however, that
in the case of a purchase of securities, other than Preferred Stock, pursuant to Section 13 hereof, the Rights Agent shall
promptly take the appropriate actions corresponding in such case to that referred to in the foregoing clauses (i) through (v) of
this Section 7(c). Notwithstanding the foregoing provisions of this Section 7(c), the Corporation may suspend the
issuance of shares of Preferred Stock upon exercise of a Right for a reasonable period, not in excess of 120 days, during which
the Corporation seeks to register under the Securities Act of 1933, as amended (the “Act”), and any applicable
securities law of any other jurisdiction, the shares of Preferred Stock to be issued pursuant to the Rights; provided, however,
that nothing contained in this Section 7(c) shall relieve the Corporation of its obligations under Section 9(c) hereof.


 


(d) In
case the registered holder of any Rights Certificate shall exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of
such Rights Certificate or his assignee, subject to the provisions of Section 14(b) hereof.


 


(e) 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) completed and signed the certificate following the form of election to purchase set forth
on the reverse side of the Rights Certificate surrendered for such exercise and (ii) provided such additional evidence of the identity
of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof or a Person referred to in clause (y)
or (z) of Section 11(a)(ii) and such other information as the Corporation shall reasonably request.


 






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Section 8. Cancellation and Destruction
of Rights Certificates.


 


All Rights Certificates surrendered for the
purpose of exercise, transfer, split up, combination or exchange shall, if surrendered to the 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 Rights Certificates shall be issued in lieu thereof except as expressly permitted by any of the provisions of this
Rights Agreement. The Corporation shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall
cancel and retire, any Rights Certificate purchased or acquired by the Corporation otherwise than upon the exercise thereof. The
Rights Agent shall deliver all canceled Rights Certificates to the Corporation, or shall, at the written request of the Corporation,
destroy such canceled Rights Certificates, and in such case shall deliver a certificate of destruction thereof to the Corporation.


 


Section 9. Reservation and Availability
of Shares of Preferred Stock.


 


(a) The
Corporation covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued shares
of Preferred Stock or out of authorized and issued shares of Preferred Stock held in its treasury, such number of shares of Preferred
Stock as will from time to time be sufficient to permit the exercise in full of all outstanding Rights. The Corporation shall take
such action as may be required for it to comply with the foregoing sentence of this Section 9(a).


 


(b) The
Corporation shall use its best efforts to cause, from and after such time as the Rights become exercisable, all shares of Preferred
Stock issued or reserved for issuance in accordance with this Rights Agreement to be listed, upon official notice of issuance,
on the NASDAQ Capital Market or successor thereto or, if the principal market for the Common Stock is not the NASDAQ Capital Market,
to be eligible for quotation on any other national securities exchange or other comparable quotation system.


 


(c) The
Corporation covenants and agrees that it will take all such actions as may be necessary to insure that all shares of Preferred
Stock delivered upon exercise of Rights shall, at the time of delivery of the certificates, for such shares (subject to payment
of the Exercise Price in respect thereof), be duly and validly authorized and issued and fully paid and nonassessable shares.


 


(d) The
Corporation shall use its best efforts to (i) file, as soon as practicable following the occurrence of the event described in Section
11(a)(ii), or as soon as is required by law following the Distribution Date, as the case may be, a registration statement under
the Act, with respect to the shares of Preferred Stock purchasable upon exercise of the Rights on an appropriate form, (ii) cause
such registration statement to become effective as soon as practicable after such filing, and (iii) cause such registration statement
to remain effective (with a prospectus at all times meeting the requirements of the Act) until the earlier of (A) the date as of
which the Rights are no longer exercisable for Preferred Stock, or (B) the Expiration Date. The Corporation may temporarily suspend,
for a period of time not to exceed 120 days, the issuance of shares of Preferred Stock upon exercise of a Right in order to prepare
and file a registration statement under the Act and permit it to become effective. The Corporation will also take such action as
may be appropriate under, or to ensure compliance with, the securities or “blue sky” laws of the various states in
connection with the exercisability of the Rights. Notwithstanding any provision of this Agreement to the contrary, the Rights shall
not be exercisable in any jurisdiction unless the requisite qualification in such jurisdiction shall have been obtained and until
a registration statement under the Act (if required) shall have been declared effective.


 






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(e) The
Corporation covenants and agrees that it will pay when due and payable any and all federal and state Transfer Taxes which may be
payable in respect of the issuance or delivery of the Rights Certificates or of any shares of Preferred Stock issued or delivered
upon the exercise of Rights. The Corporation shall not, however, be required to pay any Transfer Tax which may be payable in respect
of any transfer or delivery of a Rights Certificate to a Person other than, or the issuance or delivery of certificates or depositary
receipts for Preferred Stock upon exercise of Rights in a name other than that of, the registered holder of the Rights Certificate
evidencing Rights surrendered for exercise, and the Corporation shall not be required to or issue or deliver a Rights Certificate
or certificate or depositary receipt for Preferred Stock to a Person other than such registered holder until any such Transfer
Tax shall have been paid (any such Transfer Tax being payable by the holder of such Rights Certificate at the time of surrender)
or until it has been established to the Corporation’s satisfaction that no such Transfer Tax is due.


 


Section 10. Preferred Stock Record
Date.


 


Each Person in whose name any certificate
for shares of Preferred Stock is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder
of record of the Preferred Stock represented thereby on, and such certificate shall be dated as of, the date upon which the Rights
Certificate evidencing such Rights was duly surrendered and payment of the Exercise Price (and any applicable Transfer Taxes) was
made; provided, however, that, if the date of such surrender and payment is a date upon which the Preferred Stock
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 as of, the next succeeding Business Day on which the Preferred Stock transfer books of the Corporation
are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Rights Certificate, as such, shall not be entitled
to any rights of a stockholder of the Corporation with respect to shares for which the Rights shall be exercisable, including,
without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Corporation, except as provided herein.


 


Section 11. Adjustment of Exercise
Price, Number of Shares or Number of Rights.


 


The Exercise Price and the number of shares
of Preferred Stock which may be purchased upon exercise of a Right and the number of Rights outstanding are subject to adjustment
from time to time as provided in this Section 11.


 


(a) (i) In the event the Corporation
shall at any time after the date of this Rights Agreement (i) declare a dividend on the shares of Preferred Stock payable
in shares of Preferred Stock, (ii) subdivide the outstanding shares of Preferred Stock, (iii) combine the outstanding
shares of Preferred Stock into a smaller number of shares of Preferred Stock or (iv) 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(a),
the Exercise 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 which, if such Right had been exercised immediately prior to such date, the 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 of the shares of capital stock of the Corporation issuable upon exercise of one Right.


 






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(ii) Subject to the second paragraph of
this Section 11(a)(ii) and to Section 27, from and after the Stock Acquisition Date, each holder of a
Right shall have a right to receive, upon exercise of each Right, in accordance with the terms of this Rights Agreement and
in lieu of shares of Preferred Stock, such number of shares of the Corporation’s Common Stock as shall equal the result
obtained by dividing the current Exercise Price by 50% of the then Current Per Share Market Price of the Corporation’s
Common Stock (determined pursuant to Section 11(d)) on the Stock Acquisition Date.


 


From and after the Stock Acquisition Date, any Rights that are
or were acquired or beneficially owned by (1) an Acquiring Person (or any Associate or Affiliate of such Acquiring Person
or any other Person with whom such Person is Acting in Concert), (2) a transferee of any Acquiring Person (or of any such
Associate or Affiliate or any other Person with whom such Person is Acting in Concert) who becomes such a transferee after the
Acquiring Person becomes an Acquiring Person or (3) a transferee of an Acquiring Person (or of any such Associate or Affiliate
or any other Person with whom such Person is Acting in Concert) who becomes such a transferee prior to or concurrently with the
Acquiring Person becoming an Acquiring Person and who receives such Rights (I) with actual knowledge that the transferor is
or was an Acquiring Person or (II) pursuant to either (x) a transfer (whether or not for consideration) from the Acquiring
Person (or any such Associate or Affiliate or any other Person with whom such Person is Acting in Concert) to holders of equity
interests in such Acquiring Person (or any such Associate or Affiliate or any other Person with whom such Person is Acting in Concert)
or to any Person with whom the Acquiring Person (or such Associate or Affiliate or any other Person with whom such Person is Acting
in Concert) has any continuing agreement, arrangement, understanding or relationship (whether or not in writing) regarding the
transferred Rights or (y) a transfer which the Board of Directors has determined is part of a plan, arrangement or understanding
(whether or not in writing) which has as a primary purpose or effect of the avoidance of this Section 11(a)(ii), (each
such Person described in (1)-(3) above, an “Excluded Person”) shall, in each such case, be null
and void, and any holder of such Rights (whether or not such holder is an Acquiring Person or an Associate or Affiliate of an Acquiring
Person or any other Person with whom such Person is Acting in Concert) shall thereafter have no right to exercise such Rights under
any provision of this Rights Agreement. No Rights Certificates shall be issued pursuant to Section 3, Section 6,
Section 7(d) or Section 11 or otherwise hereof that represents Rights that are or have become null and void pursuant
to the provisions of this paragraph and any Rights Certificate delivered to the Rights Agent that represents Rights that are or
have become null and void pursuant to the provisions of this paragraph shall, upon receipt of written notice directing it to do
so, be canceled by the Rights Agent.


 






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(iii)
If there are not sufficient authorized but unissued shares of the Corporation’s Common Stock to permit the exercise
in full of the Rights in accordance with Section 11(a)(ii), or should the Board of Directors so elect, the Corporation
shall with respect to such deficiency, to the extent permitted by applicable law and any material agreements to which the Corporation
is a party, (i) determine the excess (the “Spread”) of (A) the value of the shares of the Corporation’s
Common Stock issuable upon the exercise of a Right as provided in Section 11(a)(ii) (the “Current Value”)
over (B) the Exercise Price, and (ii) with respect to each Right, make adequate provision to substitute for such shares
of Common Stock, upon payment of the applicable Exercise Price, any one or more of the following having an aggregate value determined
by the Board of Directors to be equal to the Current Value: (A) cash, (B) a reduction in the Exercise Price, (C) shares
of the Corporation’s Common Stock or other equity securities of the Corporation (including, without limitation, shares, or
units of shares, of preferred stock which the Board of Directors has determined to have the same value as the Corporation’s
Common Stock (“Common Stock Equivalents”)), (D) debt securities of the Corporation or (E) other
assets; provided, however, that if the Corporation shall not have made adequate provision to deliver value pursuant
to clause (ii) above within thirty days following the Stock Acquisition Date, then the Corporation shall be obligated to deliver,
upon the surrender for exercise of a Right and without requiring payment of the Exercise Price, shares of the Corporation’s
Common Stock (to the extent available) and then, if necessary, cash, which shares and cash shall have an aggregate value equal
to the Spread.


 


(b) If
the Board of Directors shall determine in good faith that it is likely that sufficient additional shares of the Corporation’s
Common Stock could be authorized for issuance upon exercise in full of the Rights, the 30-day period set forth above may be extended
to the extent necessary, but not more than 180 days after the Stock Acquisition Date, in order that the Corporation may seek
stockholder approval for the authorization of such additional shares (such period, as it may be extended, the “Substitution
Period”). If the Corporation determines that action need be taken pursuant to this Section 11(a)(iii),
the Corporation (x) shall provide, subject to Section 7(f) and the last paragraph of Section 11(a)(ii),
that such action shall apply uniformly to all outstanding Rights, and (y) may suspend the exercisability of the Rights until
the expiration of the Substitution Period in order to seek any authorization of additional shares, decide the appropriate form
of distribution to be made and determine the value thereof. If the exercisability of the Rights is suspended pursuant to this Section 11(a)(iii),
the Corporation shall make a public announcement, and shall deliver to the Rights Agent a statement, stating that the exercisability
of the Rights has been temporarily suspended. When the suspension is no longer in effect, the Corporation shall make another public
announcement, and deliver to the Rights Agent a statement, so stating. For purposes of this Section 11(a)(iii), the
value of the Corporation’s Common Stock shall be the Current Per Share Market Price (as determined pursuant to Section 11(d)(i))
of the Corporation’s Common Stock as of the Stock Acquisition Date, and the value of any Common Stock Equivalent shall be
deemed to have the same value as the Corporation’s Common Stock on such date.


 






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(c) If
the Corporation fixes a record date for the making of a distribution to all holders of the Preferred Stock (including any 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 shares of Preferred Stock ) or
subscription rights or warrants (excluding those referred to in Section 11(b)), the Exercise Price to be in effect
after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by
a fraction, (i) the numerator of which shall be the then Current Per Share Market Price of the Preferred Stock on such record
date, less the fair market value (as determined in good faith by the Board of Directors, whose determination shall be described
in a statement filed with the Rights Agent) of the portion of the assets or evidences of indebtedness to be distributed or of such
subscription rights or warrants applicable to one share of Preferred Stock and (ii) the denominator of which shall be the
then 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 of the shares of Preferred Stock to be issued upon
exercise of one Right. Such adjustments shall be made successively whenever such a record date is fixed. If such distribution is
not so made, the Exercise Price shall again be adjusted to be the Exercise Price that would then be in effect if such record date
had not been fixed.


 


(d) Current
Per Share Market Price.


 


(i) For
the purpose of any computation hereunder, the “Current Per Share Market Price” of any security on any
date shall be deemed to be the average of the daily closing prices per share of such security for the thirty consecutive Trading
Days immediately prior to such date; provided, however, that if the Current Per Share Market Price of the security
is determined during a period (i) 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 other securities convertible into such shares, or (B) any subdivision,
combination or reclassification of such security, and (ii) prior to the expiration of 30 Trading Days after 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 or, if no such sale takes place on such
day, the average of the closing bid and asked prices, in either case as reported by NASDAQ, or, if on any such date the security
is not listed on NASDAQ, 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. 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 shall be used.


 


(ii) 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(d)(i). If the Preferred Stock is 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 Corporation’s Common Stock as determined pursuant to Section 11(d)(i)
(appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof) multiplied
by one hundred. If neither the Common Stock nor the Preferred Stock is publicly held or so listed or traded, “Current
Per Share Market Price” means the fair value per share as determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent.


 






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(e) No adjustment
in the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Exercise
Price; provided, however, that any adjustments which by reason of this Section 11(e) are not required
to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 11
shall be made to the nearest cent or to the nearest one ten-thousandth of a share of Preferred Stock or one ten-thousandth of any
other share or security as the case may be. Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than three years from the date of the transaction which requires
such adjustment.


 


(f) If,
as a result of an adjustment made pursuant to Section 11(a), the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Corporation other than Preferred Stock, the number of such other shares
so receivable upon exercise of any Right shall thereafter 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(a)-(c),
inclusive, and the provisions of Section 7, Section 9, Section 10 and Section 13 with respect
to the Preferred Stock shall apply on like terms to any such other shares.


 


(g) All
Rights originally issued by the Corporation subsequent to any adjustment made to the Exercise Price hereunder shall evidence the
right to purchase, at the adjusted Exercise Price, the number of shares of Preferred Stock purchasable from time to time hereunder
upon exercise of the Rights, all subject to further adjustment as provided herein.


 


(h) Unless
the Corporation exercises its election as provided in Section 11(i), upon each adjustment of the Exercise Price as
a result of the calculations made in Section 11(b) and Section 11(c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number
of one one-hundredth of a share of Preferred Stock (calculated to the nearest one one-thousandth of a share of Preferred Stock)
obtained by (i) multiplying the number of one one-hundredth of a shares of Preferred Stock covered by a Right immediately
prior to this adjustment by the Exercise Price in effect immediately prior to such adjustment of the Exercise Price and (ii) dividing
the product by the Exercise Price in effect immediately after such adjustment of the Exercise Price.


 


(i) The
Corporation may elect on or after the date of any adjustment of the Exercise Price to adjust the number of Rights in substitution
for any adjustment in the number of shares 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 shares 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 hundred-thousandth) obtained by dividing the Exercise Price in
effect immediately prior to adjustment of the Exercise Price by the Exercise Price in effect immediately after adjustment of the
Exercise Price. The Corporation shall make a public announcement (with prompt written notice thereof to the Rights Agent) of its
election to adjust the number of Rights, indicating the record date for the adjustment and, if known at the time, the amount of
the adjustment to be made. The record date may be the date on which the Exercise Price is adjusted or any day thereafter but, if
the Rights Certificates have been distributed, shall be at least 10 days after the date of the public announcement. If Rights
Certificates have been distributed, upon each adjustment of the number of Rights pursuant to this Section 11(i), the
Corporation shall, as promptly as practicable, cause to be distributed to holders of record of Rights Certificates on such record
date Rights Certificates evidencing, subject to Section 14, 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 Rights Certificates held by such holders prior to the date of adjustment, and upon surrender
thereof if required by the Corporation, new Rights Certificates evidencing all the Rights to which such holders shall be entitled
after such adjustment. Rights Certificates to be so 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 Rights Certificates on the record date specified in
the public announcement.


 






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(j) Irrespective
of any adjustment or change in the Exercise Price or the number of shares of Preferred Stock issuable upon the exercise of the
Rights, the Rights Certificates theretofore and thereafter issued may continue to express the Exercise Price and the number of
shares of Preferred Stock which were expressed in the initial Rights Certificates issued hereunder.


 


(k) Before
taking any action that would cause an adjustment reducing the Exercise Price below the then par value of the Preferred Stock issuable
upon exercise of the Rights, the Corporation shall take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Corporation may validly and legally issue fully paid and non-assessable shares of Preferred Stock at such adjusted
Exercise Price.


 


(l) If
this Section 11 requires that an adjustment in the Exercise Price be made effective as of a record date for a specified
event, the Corporation may defer, until the occurrence of such event, issuing to the holder of any Right exercised after such record
date shares of Preferred Stock and other capital stock or securities of the Corporation, if any, issuable upon such exercise over
and above the Preferred Stock and other capital stock or securities of the Corporation, if any, issuable upon such exercise on
the basis of the Exercise 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 adjustment.


 


(m) Anything
in this Section 11 to the contrary notwithstanding, the Corporation shall be entitled to make such reductions in the
Exercise Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that it
in its sole discretion shall determine to be advisable in order that any (i) combination or subdivision of the Preferred Stock,
(ii) issuance wholly for cash of any shares of Preferred Stock at less than the Current Per Share Market Price, (iii) issuance
wholly for cash of shares of Preferred Stock or securities which by their terms are convertible into or exchangeable for shares
of Preferred Stock, (iv) dividends on the Preferred Stock payable in shares of Preferred Stock, or (v) issuance of any
rights, options or warrants referred to in Section 11(b) made by the Corporation after the date of this Rights Agreement
to holders of its Preferred Stock shall not be taxable to such stockholders.


 






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(n) If,
at any time after the date of this Rights Agreement and prior to the Distribution Date, the Corporation (i) declares or pays
any dividend on the Corporation’s Common Stock payable in shares of Common Stock or (ii) effects a subdivision, combination
or consolidation of the Corporation’s Common Stock (by reclassification or otherwise other 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 (x) the number of
one one-hundredths of a share of Preferred Stock purchasable after such event upon exercise of each Right shall be determined by
multiplying the number of one one-thousandths of a share of Preferred Stock so purchasable immediately prior to such event by a
fraction, the numerator of which is the number of shares of Common Stock outstanding immediately before such event and the denominator
of which is the number of shares of Common Stock outstanding immediately after such event, and (y) each share of the Corporation’s
Common Stock outstanding immediately after such event shall have issued with respect to it that number of Rights which each share
of Common Stock outstanding immediately prior to such event had issued with respect to it. The adjustments provided for in this
Section 11(n) shall be made successively whenever such a dividend is declared or paid or such a subdivision, combination
or consolidation is effected.


 


Section 12. Certification of Adjusted
Exercise Price or Number of Shares.


 


Whenever an adjustment is made as provided
in Section 11, Section 13 or Section 23(c), the Corporation shall (a) promptly prepare a certificate setting
forth such adjustment, and a brief statement of the facts giving rise to such adjustment and the computation, methodology and accounting
for such adjustment, (b) promptly file with the Rights Agent and with each transfer agent for the Preferred Stock a copy of such
certificate and (c) mail a brief summary thereof to each holder of a Rights Certificate in accordance with Section 25. Notwithstanding
the foregoing sentence, the failure of the Corporation to make such certification or give such notice shall not affect the validity
of or the force or effect of the requirement for such adjustment. Any adjustment to be made pursuant to Section 11, Section
13 or Section 23(c) of this Rights Agreement shall be effective as of the date of the event giving rise to such adjustment.
The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment therein contained and shall
not be deemed to have knowledge of any adjustment unless and until it shall have received such certificate.


 






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


 


(a) In
the event that, at any time after the time that any Person becomes an Acquiring Person, (x) the Corporation shall, directly or
indirectly, consolidate with, or merge with and into, any other Person or Persons (other than an Exempt Person or Persons) and
the Corporation shall not be the surviving or continuing corporation of such consolidation or merger, or (y) any Person or Persons
(other than an Exempt Person) shall, directly or indirectly, consolidate with, or merge with and into, the Corporation, and the
Corporation shall be the continuing or surviving corporation of such consolidation or merger and, in connection with such consolidation
or merger, all or part of the outstanding shares of Common Stock shall be changed into or exchanged for stock or other securities
of any other Person (other than an Exempt Person) or of the Corporation or cash or any other property, or (z) the Corporation or
one or more of its Subsidiaries shall, directly or indirectly, sell or otherwise transfer to any other Person or any Affiliate
or Associate of such Person, in one or more transactions, or the Corporation or one or more of its Subsidiaries shall sell or otherwise
transfer to any Persons in one or a series of related transactions, assets or Earning Power (as defined herein) aggregating more
than 50% of the assets or Earning Power of the Corporation and its Subsidiaries (taken as a whole), then, on the first occurrence
of any such event, proper provision shall be made so that (i) each holder of record of a Right, except as provided in Section
11(a)(ii) hereof, shall thereafter have the right to receive, upon the exercise thereof and payment of the Exercise Price in
accordance with the terms of this Rights Agreement and in lieu of shares of Preferred Stock, such number of shares of validly issued,
fully paid, non-assessable and freely tradable Common Stock of the Principal Party (as defined herein), not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as shall equal the result obtained by dividing the Exercise Price
by 50% of the Fair Market Value of the Common Stock of the Principal Party on the date of the consummation of such consolidation,
merger, sale or transfer; (ii) such Principal Party shall thereafter be liable for, and shall assume, by virtue of such consolidation,
merger, sale or transfer, all the obligations and duties of the Corporation pursuant to this Rights Agreement; (iii) the term “Corporation”
for all purposes of this Rights Agreement shall thereafter be deemed to refer to such Principal Party; (iv) such Principal Party
shall take such steps (including, but not limited to, the reservation of a sufficient number of shares of its Common Stock in accordance
with the provisions of Section 9 hereof applicable to the reservation of Preferred Stock) in connection with such consummation
as may be necessary to insure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation
to its shares of Common Stock thereafter deliverable upon the exercise of the Rights; provided, however, that, upon
the subsequent occurrence of any merger, consolidation, sale of all or substantially all of the assets, recapitalization, reclassification
of shares, reorganization or other extraordinary transaction in respect of such Principal Party, each holder of a Right shall thereupon
be entitled to receive, upon exercise of a Right and payment of the Exercise Price, such cash, shares, rights, warrants and other
property which such holder would have been entitled to receive had it, at the time of such transaction, owned the shares of Common
Stock of the Principal Party purchasable upon the exercise of a Right, and such Principal Party shall take such steps (including,
but not limited to, reservation of shares of stock) as may be necessary to permit the subsequent exercise of the Rights in accordance
with the terms hereof for such cash, shares, rights, warrants and other property; and (v) the provisions of Section 11 (a)(ii)
hereof shall be of no effect following the occurrence of any event described in clause (x), (y) or (z) above of this Section
13(a).


 


(b) “Earning
Power” of the Corporation and its Subsidiaries shall be determined in good faith by the Corporation’s Board
of Directors on the basis of the operating earnings of each business operated by the Corporation and its Subsidiaries during the
three fiscal years preceding the date of such determination (or, in the case of any business not operated by the Corporation or
any Subsidiary during three full fiscal years preceding such date, during the period such business was operated by the Corporation
or any Subsidiary).


 






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(c)
“Principal Party” shall mean:


 


(i) in
the case of any transaction described in (x) or (y) of the first sentence of Section 13(a) hereof: (A) the Person that is
the issuer of the securities into which shares of Common Stock of the Corporation are changed or otherwise exchanged or converted
in such merger or consolidation, or, if there is more than one such issuer, the issuer of the Common Stock of which has the greatest
market value or (B) if no securities are so issued, (x) the Person that is the other party to the merger or consolidation and that
survives such merger or consolidation, or, if there is more than one such Person, the Person the Common Stock of which has the
greatest market value or (y) if the Person that is the other party to the merger or consolidation does not survive the merger or
consolidation, the Person that does survive the merger or consolidation (including the Corporation if it survives); and


 


(ii) in
the case of any transaction described in (z) of the first sentence in Section 13(a), the Person that is the party receiving
the greatest portion of the assets or Earning Power transferred pursuant to such transaction or transactions, or, if each Person
that is a party to such transaction or transactions receives the same portion of the assets or Earning Power so transferred or
if the Person receiving the greatest portion of the assets or Earning Power cannot be determined, whichever of such Persons as
is the issuer of Common Stock having the greatest market value of shares outstanding;


 


provided, however, that in any
case, (1) if the Common Stock of such Person is not at such time and has not been continuously over the preceding 12-month period
registered under Section 12 of the Exchange Act, and such Person is a direct or indirect Subsidiary of another Person the Common
Stock of which is and has been so registered, the term “Principal Party” shall refer to such other Person; (3) if such
Person is a Subsidiary, directly or indirectly, or Affiliate of more than one Person, the Common Stock of two or more of which
are and have been so registered, the term “Principal Party” shall refer to whichever of such Persons is the issuer
of the Common Stock having the greatest market value of shares outstanding; and (3) if 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.


 


(d) The
Corporation shall not consummate any consolidation, merger or sale or transfer of assets or Earning Power referred to in Section
13(a) unless the Principal Party shall have a sufficient number of authorized shares of its Common Stock that have not been
issued or reserved for issuance to permit exercise in full of all Rights in accordance with this Section 13 and unless prior
thereto the Corporation and each Principal Party and each other Person that may become a Principal Party as a result of such consolidation,
merger, sale or transfer shall have executed and delivered to the Rights Agent an agreement confirming that the Principal Party
shall, upon consummation of such consolidation, merger or sale or transfer of assets or Earning Power, assume this Rights Agreement
in accordance with Section 13(a) hereof and that all rights of first refusal or preemptive rights in respect of the issuance
of shares of Common Stock of the Principal Party upon exercise of outstanding Rights have been waived and that such transaction
shall not result in a default by the Principal Party under this Rights Agreement, and further providing that, as soon as practicable
after the date of any consolidation, merger or sale or a transfer of assets or Earning Power referred to in Section 13(a)
hereof, the Principal Party will:


 


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


 






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(ii) use
its best efforts to (1) list (or continue the listing of) the Rights and the securities purchasable upon exercise of the Rights
on a national securities exchange or to meet the eligibility requirements for quotation on the NASDAQ Capital Market, and (2) 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


 


(iii) deliver
to holders of the Rights historical financial statements for the Principal Party and each of its Affiliates which comply in all
respects with the requirements for registration on Form 10 (or any successor form) under the Exchange Act. In the event that any
of the transactions described in Section 13(a) hereof shall occur at any time after the occurrence of a transaction described
in Section 11(a)(ii) hereof, the Rights which have not theretofore been exercised shall, subject to the provisions of Section
11(a)(ii) hereof, thereafter be exercisable in the manner described in Section 13(a).


 


(e) In
case the Principal Party which is to be a party to a transaction referred to in this Section 13 has a provision in any of
its authorized securities or in its Certificate of Incorporation, as amended, or Amended and Restated By-laws, as amended, or other
instrument governing its corporate affairs, which provision would have the effect of (i) causing such Principal Party to issue,
in connection with, or as a consequence of, the consummation of a transaction referred to in this Section 13, shares of
Common Stock of such Principal Party at less than the then Fair Market Value per share (determined pursuant to Section 11(b)
hereof) or securities exercisable for, or convertible into, Common Stock of such Principal Party at less than such then Fair Market
Value (other than to holders of Rights pursuant to this Section 13) or (ii) providing for any special or similar payment
in connection with the issuance to any holder of a Right of Common Stock of such Principal Party pursuant to the provisions of
this Section 13, then, in such event, the Corporation shall not consummate any such transaction unless prior thereto the
Corporation and such Principal Party shall have executed and delivered to the Rights Agent a supplemental agreement providing that
the provision in question of such Principal Party shall have been canceled, waived or amended, or that the authorized securities
shall be redeemed, so that the applicable provision will have no effect in connection with, or as a consequence of, the consummation
of the proposed transaction.


 


Section 14. Fractional Rights and Fractional
Shares.


 


(a) The
Corporation shall not be required to issue fractions of Rights or to distribute Rights Certificates which evidence fractional Rights
(i.e., Rights to acquire less than one one-hundredth of a share of Preferred Stock). If the Corporation shall determine not to
issue such fractional Rights, then, in lieu of such fractional Rights, there shall be paid to the holders of record of the Rights
Certificates with regard to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction
of the Fair Market Value of a whole Right. For the purposes of this Section 14(a), the Fair 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 NASDAQ,
or, if the Rights are not listed or admitted to trading on NASDAQ, 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 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,
or, if on any such date no professional market maker is making a market in the Rights, the Fair Market Value of a whole Right shall
be determined by an independent investment banking firm experienced in the valuation of securities selected in good faith by the
Board of Directors of the Corporation, or, if no such investment banking firm is, in the good faith judgment of the Board of Directors,
available to make such determination, the Fair Market Value of a whole Right on such date shall be determined in good faith by
the Board of Directors.


 






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(b) The
Corporation shall not be required to issue fractions of shares of Preferred Stock (other than fractions which are integral multiples
of one-hundredth of a share) upon exercise of the Rights or to distribute certificates which evidence fractional shares (other
than fractions which are integral multiples of one-hundredth of a share). In lieu of issuing fractions of shares of Preferred Stock,
the Corporation may, at its election, issue depositary receipts evidencing fractions of shares 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 all of the rights, privileges and preferences to which they would be entitled as owners of the Preferred Stock.
With respect to fractional shares that are not integral multiples of one-hundredth of a share, if the Corporation does not issue
such fractional shares or depositary receipts in lieu thereof, there shall be paid to the holders of record of Rights Certificates
at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the Fair Market Value
of a share of Preferred Stock.


 


(c) Following
the occurrence of one of the transactions or events specified in Section 11 hereof giving rise to the right to receive
shares of Common Stock, capital stock equivalents (other than shares of Preferred Stock) or other securities upon the exercise
of a Right, the Corporation shall not be required to issue fractions of shares of Common Stock or units of such Common Stock, capital
stock equivalents or other securities upon exercise of the Rights or to distribute certificates that evidence fractional shares
of Common Stock, capital stock equivalents or other securities.  In lieu of fractional shares of Common Stock, capital
stock equivalents or other securities, the Corporation shall pay to the registered holders of Rights Certificates at the time such
Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one share of
Common Stock or unit of such Common Stock, capital stock equivalents or other securities.  For purposes of this Section 14(c),
the Fair Market Value shall be the current closing price 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-hundredth of
a share of Preferred Stock.


 






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


 


(e) The
holder of a Right by the acceptance of a Right expressly waives his, her or its right to receive any fractional Right or any fractional
shares of Preferred Stock (other than fractions which are integral multiples of one one-hundredth of a share) upon exercise of
a Right.


 


Section 15. Rights of Action.


 


All rights of action in respect of this Rights
Agreement, except the rights of action given to the Rights Agent in Section 18 and Section 20 hereof, are vested
in the respective registered holders of the Rights Certificates (and, prior to the Distribution Date, the holders of record of
the Common Stock); and any holder of record of any Rights Certificate (or, prior to the Distribution Date, of the Common Stock),
without the consent of the Rights Agent or of the holder of any other Rights Certificate (or, prior to the Distribution Date, of
the Common Stock), may, in his own behalf and for his own benefit, enforce, and may institute and maintain any suit, action or
proceeding against the Corporation to enforce, or otherwise act in respect of, his, her or its right to exercise the Rights evidenced
by such Rights Certificate in the manner provided in such Rights Certificate and in this Rights 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 Rights 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
Rights Agreement.


 


Section 16. Agreement of Right Holders.


 


Each 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:


 


(a) Prior
to the Distribution Date, the Rights shall be evidenced by the Book-Entries representing, or the certificates for, Common Stock
registered in the name of the holders of Common Stock (together, as applicable, with the Summary of Rights), which Book Entries
representing, or the certificates for, Common Stock shall also constitute certificates for Rights, and not by separate Rights Certificates,
and each Right shall be transferable only simultaneously and together with the transfer of shares of Common Stock;


 






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(b) After
the Distribution Date, the Rights Certificates are transferable (subject to the provisions of this Rights Agreement) 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;


 


(c) The
Corporation and the Rights Agent may deem and treat the person in whose name the Rights Certificate (or, prior to the Distribution
Date, the associated Book Entry representing, or certificate for, Common Stock) is registered as the absolute owner thereof and
of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Rights Certificates or the associated
Common Stock certificate made by anyone other than the Corporation or the Rights Agent) for all purposes whatsoever, and neither
the Corporation nor the Rights Agent shall be affected by any notice to the contrary;


 


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


 


(e) Rights
Beneficially Owned by certain persons will under certain circumstances set forth in this Rights Agreement become null and void
pursuant to Section 11(a)(ii) hereof; and


 


(f) This
Rights Agreement may be supplemented or amended from time to time pursuant to Section 26 hereof.


 


Section 17. Rights Certificate Holder
Not Deemed a Stockholder.


 


No holder, as such, of any Rights Certificate
shall be entitled to vote, receive dividends or be deemed for any purpose the holder of Preferred Stock or any other securities
which may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or in
any Rights Certificate be construed to confer upon the holder of any Rights Certificate, as such, any of the rights of a stockholder
of the 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 26 hereof), or to receive dividends or subscription rights, or otherwise, until the Right
or Rights evidenced by such Rights Certificate shall have been exercised in accordance with the provisions hereof.


 






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Section 18. Concerning the Rights Agreement.


 


(a) 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
and execution of this Rights 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, or expense (including, without limitation,
the reasonable fees and expenses of legal counsel) incurred without gross negligence, bad faith or willful misconduct on the part
of the Rights Agent, for anything done or failed to be done by the Rights Agent in connection with the acceptance and administration
of this Rights Agreement, including the costs and expenses of defending against any claim of liability relating to the Rights or
this Rights Agreement. The provisions under this Section 18 and Section 20 below shall survive the expiration
of the Rights and the termination of this Agreement and the resignation, replacement or removal of the Rights Agent. The reasonable
costs and expenses incurred in enforcing this right of indemnification shall be paid by the Corporation to the extent that the
Rights Agent is successful in so enforcing its right of indemnification.


 


(b) The
Rights Agent shall be protected against, and shall incur no liability for or in respect of, any action taken, suffered or omitted
by it in connection with its administration of this Rights Agreement in reliance upon any Rights Certificate or certificate for
Preferred 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.  In no case will the Rights Agent be liable for special, indirect,
incidental or consequential or consequential loss or damage at any kind whatsoever (including but not limited to lost profits),
even if the Rights Agent has been advised of such loss or damage.


 


Section 19. Merger or Consolidation
of, or Change in Name of, the Rights Agent.


 


(a) Any
Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person
succeeding to the corporate trust or stock transfer business of the Rights Agent or any successor Rights Agent, shall be the successor
to the Rights Agent under this Rights 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. In case at the time such successor Rights Agent shall succeed to the agency created
by this Rights Agreement any of the Rights Certificates shall have been countersigned but not delivered, any such successor Rights
Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Rights Certificates so countersigned; and
in case at that time any of the Rights Certificates shall not have been countersigned, any successor Rights Agent may countersign
such Rights Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Rights Certificates shall have the full force provided in the Rights Certificates and in this Rights Agreement.


 


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


 






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Section 20. Duties of Rights Agent.


 


The Rights Agent undertakes to perform only
the duties and obligations expressly set forth in this Rights Agreement and no implied duties or obligations shall be read into
this Rights Agreement against the Rights Agent. The Rights Agent shall perform its duties and obligations hereunder upon the following
terms and conditions, by all of which the Corporation and the holders of Rights Certificates, by their acceptance thereof, shall
be bound:


 


(a) The
Rights Agent may consult with legal counsel (who may be legal counsel for the Corporation), and the advice or opinion of such counsel
shall be full and complete authorization and protection to the Rights Agent as to any action taken or omitted by it in good faith
and in accordance with such opinion.


 


(b) Whenever
in the performance of its duties under this Rights Agreement the Rights Agent shall deem it necessary or desirable that any fact
or matter be proved or established by the Corporation prior to taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by
a certificate signed by the Chairman of the Board, Chief Executive Officer, President or any Vice President and by the Treasurer
or the Secretary of the Corporation and delivered to the Rights Agent. Any such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith by it under the provisions of this Rights Agreement in reliance upon
such certificate.


 


(c) The
Rights Agent shall be liable hereunder to the Corporation and any other Person only for its own gross negligence, bad faith or
willful misconduct.


 


(d) The
Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Rights Agreement
or in the Rights Certificates (except its countersignature thereof) 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.


 


(e) The
Rights Agent shall not be under any responsibility in respect of the validity of this Rights Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Rights Certificate
(except its countersignature thereof); nor shall it be responsible for any breach by the Corporation of any covenant or condition
contained in this Rights Agreement or in any Rights Certificate; nor shall it be responsible for any change in the exercisability
of the Rights (including the Rights becoming void pursuant to Section 11(a)(ii) hereof) or any adjustment required
under the provisions of Section 11 or Section 13 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 Rights Certificates after receipt of a certificate describing any such adjustment); nor shall it by any
act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Preferred
Stock to be issued pursuant to this Rights Agreement or any Rights Certificate or as to whether any shares of Preferred Stock will,
when issued, be validly authorized and issued, fully paid and nonassessable.


 






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(f) 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 the Rights Agreement.


 


(g) The
Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from
the Chairman of the Board, Chief Executive Officer, President or any Vice President or the Secretary or the Treasurer of the Corporation,
and to apply to such officers for advice or instructions in connection with its duties, and it shall not be liable for any action
taken or suffered to be taken by it in good faith in accordance with instructions of any such officer or for any delay in acting
while waiting for those instructions. 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 or omitted by the Rights Agent with respect
to its duties or obligations under this Rights Agreement and the date on and/or after which such action shall be taken or omitted
and the Rights Agent shall not be liable for any action taken or omitted in accordance with a proposal included in any such application
on or after the date specified therein (which date shall not be less than three Business Days after the date indicated in such
application unless any such officer shall have consented in writing to an earlier date) unless, prior to taking or omitting any
such action, the Rights Agent has received written instructions in response to such application specifying the action to be taken
or omitted.


 


(h) The
Rights Agent and any stockholder, director, officer or employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Corporation or become financially 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 the Rights Agent under
this Rights Agreement. Nothing herein shall preclude the Rights Agent from acting in any other capacity for the Corporation or
for any other legal entity.


 


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


 


(j) No provision
of this Rights 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 the Rights Agent believes that repayment
of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.


 


(k) The
Rights Agent shall not be required to take notice or be deemed to have notice of any fact, event or determination (including, without
limitation, any dates or events defined in this Rights Agreement or the designation of any Person as an Acquiring Person, Affiliate
or Associate or Person with whom another Person is Acting in Concert) under this Rights Agreement unless and until the Rights Agent
shall be specifically notified in writing by the Corporation of such fact, event or determination.


 






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(l) 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 executed, the Rights Agent shall not take
any further action with respect to such requested exercise of transfer without first consulting with the Corporation.


 


Section 21. Change of Rights Agent.


 


The Rights Agent or any successor Rights
Agent may resign and be discharged from its duties under this Rights Agreement upon 30 days notice in writing mailed to the Corporation
and to each transfer agent of the Common Stock and the Preferred Stock by registered or certified mail. The Corporation may remove
the Rights Agent or any successor Rights Agent (with or without cause) upon 30 days notice in writing, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each transfer agent of the Common Stock and the Preferred Stock by registered
or certified 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. Notwithstanding the foregoing provisions of this Section 21, in no event
shall the resignation or removal of a Rights Agent be effective until a successor Rights Agent shall have been appointed and have
accepted such appointment. If the Corporation shall fail to make such appointment within a period of 30 days after such removal
or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Rights Certificate (who shall, with such notice, submit his Rights Certificate for inspection by the Corporation),
then the incumbent Rights Agent or the holder of record of any Rights Certificate may apply to any court of competent jurisdiction
for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Corporation or by such a court,
shall be (a) a Person organized and doing business under the laws of the United States or of any state thereof, in good standing,
which is authorized under such laws to exercise corporate trust or stock transfer powers and is subject to supervision or examination
in the conduct of its corporate trust or stock transfer business by federal or state authorities and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least $50,000,000 or (b) an Affiliate controlled by a Person described
in clause (a) of this sentence. After appointment, the successor Rights Agent shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named as Rights Agent without further act or deed, but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the purpose. Not later than the effective date of any such appointment,
the Corporation shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Stock
and Preferred Stock, and mail a notice thereof in writing to the registered holders of the Rights Certificates. Failure to give
any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be. Notwithstanding
the foregoing provisions, in the event of resignation, removal or incapacity of the Rights Agent, the Corporation shall have the
authority to act as the Rights Agent until a successor Rights Agent shall have assumed the duties of the Rights Agent hereunder.


 






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Section 22. Issuance of New Rights
Certificates.


 


Notwithstanding any of the provisions of
this Rights Agreement or of the Rights to the contrary, the Corporation may, at its option, issue new Rights Certificates evidencing
Rights in such form as may be approved by its Board of Directors to reflect any adjustment or change in the Exercise Price per
share and the number or kind or class of shares of stock or other securities or property purchasable under the Rights Certificates
made in accordance with the provisions of this Rights Agreement. In addition, in connection with the issuance or sale of shares
of Common Stock following the Distribution Date and prior to the earlier of the Redemption Date (as defined herein) and the Close
of Business on the Expiration Date, the Corporation may, with respect to shares of Common Stock so issued or sold (a) pursuant
to the exercise of stock options; (b) under any employment plan or arrangement; (c) upon the exercise, conversion or
exchange of securities, notes or debentures issued by the Corporation; or (d) pursuant to a contractual obligation of the
Corporation, in each case existing prior to the Distribution Date, issue Rights Certificates representing the appropriate number
of Rights in connection with such issuance or sale; provided, however, that (i) the Corporation shall not be
obligated to issue any such Rights Certificates if, and to the extent that, the Corporation shall be advised by counsel that such
issuance would create a significant risk of material adverse tax consequences to the Corporation or the Person to whom such Rights
Certificate would be issued, and (ii) no Rights Certificate shall be issued if, and to the extent that, appropriate adjustment
shall otherwise have been made in lieu of the issuance thereof.


 


Section 23. Redemption.


 


(a) The
Corporation may, at its option, but only by the vote of a majority of the Board of Directors, redeem all but not less than all
of the then outstanding Rights, at any time prior to the Close of Business on the earlier of (i) the tenth day following the Stock
Acquisition Date (subject to extension by the Corporation as provided in Section 26 hereof) or (ii) the Expiration Date,
at a redemption price of $0.01 per Right, subject to adjustments as provided in subsection (c) below (the “Redemption
Price”). The redemption of the Rights by the Board of Directors may be made effective at such time, on such basis
and subject to such conditions as the Board of Directors in its sole discretion may establish.


 


(b) Immediately
upon the action of the Board of Directors ordering the redemption of the Rights pursuant to Section 23(a) hereof,
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.  The Corporation shall promptly give public notice of any
such redemption; provided, however, that the failure to give, or any defect in, any such notice shall not affect
the validity of such redemption. Within 10 days after the effective time of the action of the Board of Directors ordering the redemption
of the Rights, the Corporation shall give notice of such redemption to the holders of the then outstanding Rights by mailing such
notice to all such holders at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common Stock; provided, however, that failure
to give, or any defect in, any such notice shall not affect the validity of such redemption. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives the notice. Each notice of redemption will state
the method by which the payment of the Redemption Price will be made. At the option of the Board of Directors, the Redemption Price
may be paid in cash to each Rights holder or by the issuance of shares (and, at the Corporation’s election pursuant to Section
14(b) hereof, cash or depositary receipts in lieu of fractions of shares other than fractions which are integral multiples
of one one-hundredth (1/100th) of a share) of Preferred Stock or Common Stock having a Fair Market Value equal to such cash payment.


 






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(c) In
the event the Corporation shall at any time after the date of this Rights Agreement (i) pay any dividend on Common Stock in shares
of Common Stock; (ii) subdivide or split the outstanding shares of Common Stock into a greater number of shares; (iii) combine
or consolidate the outstanding shares of Common Stock into a smaller number of shares or effect a reverse split of the outstanding
shares of Common Stock; or (iv) combine or consolidate the outstanding shares of Common Stock into a smaller number of shares of
its capital stock in a reclassification of the Common Stock (including any such reclassification in connection with a consolidation
or merger in which the Corporation is the continuing or surviving corporation), then, and in each such event, the Redemption Price
shall be appropriately adjusted to reflect the foregoing.


 


(d) The
Corporation may, at its option, discharge all of its obligations with respect to any redemption of the Rights by (i) issuing
a press release announcing the manner of redemption of the Rights and (ii) mailing payment of the Redemption Price to the
registered holders of the Rights at their last 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 for the Common Stock, and upon such action, all outstanding
Rights Certificates shall be null and void without any further action by the Corporation.


 


Section 24. Notice of Proposed Actions.


 


(a) If
the Corporation shall after the Distribution Date 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 shares of 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, 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; (v) to
effect the liquidation, dissolution or winding-up of the Corporation; or (vi) to declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or to effect a subdivision, combination or consolidation of the Common Stock (by reclassification
or otherwise than by payment of dividends in shares of Common Stock), then, in each such case, the Corporation shall give to each
holder of a Rights Certificate and the Rights Agent, in accordance with Section 25, 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 Common Stock or Preferred Stock or both, 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 ten 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 10 days prior to the date of the taking of such proposed action or the date of participation therein by
the holders of the Common Stock or Preferred Stock or both, whichever shall be the earlier. The failure to give notice required
by this Section 24 or any defect therein shall not affect the legality or validity of the action taken by the Corporation
or the vote upon any such action.


 






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(b) The
Corporation shall, as soon as practicable after a Stock Acquisition Date, give to each holder of a Rights Certificate, in accordance
with Section 25, a notice that describes the transaction in which the a Person became an Acquiring Person and the consequences
of the transaction to holders of Rights under Section 11(a)(ii).


 


Section 25. Notices.


 


Notices or demands authorized by this Rights
Agreement to be given or made by the Rights Agent or by the holder of record of any Rights Certificate or Right to or on the Corporation
shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:


 


TSR, Inc.

400 Oser Avenue, Suite 150

Hauppauge, NY 11788

(631) 231-0333

Attention: Christopher Hughes


 


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


 


Continental Stock Transfer & Trust Company

1 State Street, 30th Floor

New York, NY 10004

(212) 845-3218


Attention: Erika Young, Vice President &
Account Administrator


 


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


 






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Section 26. Supplements and Amendments.


 


For as long as the Rights are then redeemable,
the Corporation may in its sole and absolute discretion, and the Rights Agent shall if the Corporation so directs, supplement or
amend any provision of this Agreement without the approval of any holders of the Rights. At any time when the Rights are not then
redeemable, the Corporation may, and the Rights Agent shall if the Corporation so directs, supplement or amend this Rights Agreement
without the approval of any holders of Rights Certificates (i) to cure any ambiguity, (ii) to correct or supplement any provision
contained, herein which may be defective or inconsistent with any other provisions herein or (iii) to change or supplement the
provisions hereunder in any manner which the Corporation may deem necessary or desirable, provided that no such supplement or amendment
pursuant to this clause (iv) shall materially adversely affect the interest of the holders of Rights Certificates. 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 26, the Rights Agent shall execute such supplement or amendment.


 


Section 27. Exchange.


 


(a) 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 void pursuant to the provisions
of Section 11(a)(ii) hereof) for shares of Common Stock at an exchange ratio of one share per Right, appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such exchange ratio being hereinafter
referred to as the “Exchange Ratio”). Notwithstanding the foregoing, the Board of Directors shall not
be empowered to effect such exchange at any time after any Person (other than an Exempt Person), together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or more of the Corporation’s Common Stock then-outstanding.


 


(b) Immediately
upon the action of the Board of Directors of the Corporation ordering the exchange of any Rights pursuant to paragraph (a) of this
Section 27 and without any further action and without any notice, the right to exercise such Rights shall terminate and
the only right thereafter of a holder of such Rights shall be to receive that number of shares of Common Stock equal to the number
of such Rights held by such holder multiplied by the Exchange Ratio. The Corporation shall promptly give public notice of any such
exchange; provided, however, that the failure to give, or any defect in, such notice shall not affect the validity
of such exchange. The 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 will state the method by which
the exchange of the shares of Common Stock for Rights will be effected and, in the event of any partial exchange, the number of
Rights which will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights
which have become void pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of Rights.


 






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(c) In
the event that there shall not be sufficient shares of Common Stock issued but not outstanding or authorized but unissued to permit
any exchange of Rights as contemplated in accordance with this Section 27, the Corporation shall take all such action as
may be necessary to authorize additional shares of Common Stock for issuance upon exchange of the Rights.


 


(d) The
Corporation shall not be required to issue fractions of shares of Common Stock or to distribute certificates which evidence fractional
shares. In lieu of such fractional shares, the Corporation shall pay to the registered holders of the Rights Certificates with
regard to which such fractional shares of Common Stock would otherwise be issuable an amount in cash equal to the same fraction
of the current market value of a whole share of Common Stock. For the purposes of this paragraph (d), the current market value
of a whole share of Common Stock shall be the closing price of a share of Common Stock for the Trading Day immediately prior to
the date of exchange pursuant to this Section 27.


 


Section 28. Successors.


 


All of the covenants and provisions of this
Rights 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.


 


Section 29. Benefits of this Rights
Agreement.


 


Nothing in this Rights Agreement shall be
construed to give to any Person or corporation other than the Corporation, the Rights Agent and the registered holders of the Rights
Certificates (and, prior to the Distribution Date, the holders of Common Stock in their capacity as holders of the Rights) any
legal or equitable right, remedy or claim under this Rights Agreement; but this Rights Agreement shall be for the sole and exclusive
benefit of the Corporation, the Rights Agent and the holders of record of the Rights Certificates (and, prior to the Distribution
Date, the holders of Common Stock in their capacity as holders of the Rights).


 


Section 30. Delaware Contract.


 


This Rights Agreement and each Rights Certificate
issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed
by and construed and enforced in accordance with the laws of such state applicable to contracts to be made and performed entirely
within such state.


 


Section 31. Counterparts.


 


This Rights Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.


 


Section 32. Descriptive Headings.


 


Descriptive headings of the several Sections
of this Rights Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of
the provisions hereof.


 






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Section 33. Severability.


 


If any term, provision, covenant or restriction
of this Rights 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 Rights Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.


 


Section 34. Determinations 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 of Directors or to 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 Rights Agreement and (ii) make all determinations
deemed necessary or advisable for the administration of this Rights Agreement (including a determination to redeem or not redeem
the Rights or to amend this Rights 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 of Directors in
good faith shall (x) be final, conclusive and binding on the Corporation, the Rights Agent, the holders of the Rights and all other
parties, and (y) not subject the Board of Directors to any liability to the holders of the Rights.


 




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


 


	 	TSR, INC.
	 	 
	 	By: 	 
	 	Name: 	Christopher Hughes
	 	Title: 	Chief Executive Officer
	 	 
	 	CONTINENTAL STOCK TRANSFER & TRUST COMPANY
	 	 
	 	By: 	 
	 	Name: 	 Erika Young
	 	Title: 	Vice President & Account Administrator




 




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EXHIBIT A


 


TO RIGHTS AGREEMENT


 


UNDER CERTAIN CIRCUMSTANCES
AS PROVIDED IN THE RIGHTS AGREEMENT (AS REFERRED TO BELOW), RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR
AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL
AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.


 


TSR, INC.


 


SUMMARY OF RIGHTS TO PURCHASE
CLASS A PREFERRED STOCK, SERIES ONE


 


On August
29, 2018, the Board of Directors of TSR, INC. (the “Corporation”) declared a dividend distribution
of one preferred stock purchase right for each outstanding share of Common Stock, par value $0.01 per share (the “Common
Stock”), of the Corporation held by stockholders of record on August
29, 2018 (the “Record Date”). Each Right entities the registered holder to purchase from the Corporation
one one-hundredth (1/100th) of a share of preferred stock of the Corporation, designated as Class A Preferred Stock, Series One
(the “Preferred Stock”) at a price of $24.78 per one one-hundredth (1/100th) of a share (the “Exercise
Price”). The description and terms of the Rights are set forth in a Rights Agreement (the “Rights Agreement”),
dated as of August 29, 2018, between the Corporation and Continental
Stock Transfer & Trust Company, as Rights Agent (the “Rights Agent”).


 


As discussed below, initially the Rights
will not be exercisable, certificates will not be sent to stockholders and the Rights will automatically trade with the Common
Stock.


 


The Rights, unless earlier redeemed by the
Board of Directors, become exercisable upon the close of business on the day (the “Distribution Date”)
which is the earlier of (i) the tenth day following the first date (the “Stock Acquisition Date”) on
which there is a public announcement that a person or group of affiliated or associated persons, with certain exceptions set forth
below, has acquired beneficial ownership of 5% or more of the Corporation’s outstanding Common Stock (an “Acquiring
Person”) or such earlier or later date (not beyond the thirtieth day after the Stock Acquisition Date) as the Board
of Directors may determine or (ii) the tenth business day (or such later date as may be determined by the Board of Directors prior
to such time as any person or group of affiliated or associated persons becomes an Acquiring Person) after the date of the commencement
or announcement of a person’s or group’s intention to commence a tender or exchange offer the consummation of which
would result in the ownership of 5% or more of the Corporation’s outstanding Common Stock (even if no shares are actually
purchased pursuant to such offer); prior thereto, the Rights will not be exercisable, will not be represented by a separate certificate,
and will not be transferable apart from the Common Stock, but will instead be evidenced, (i) with respect to any of the shares
of Common Stock held in uncertificated book-entry form (a “Book-Entry”) outstanding as of the Record
Date, by such Book-Entry and (ii) with respect to the shares of Common Stock evidenced by Common Stock certificates outstanding
as of the Record Date, by such Common Stock certificate, together with a copy of this Summary of Rights.


 






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An Acquiring Person does not include (A)
the Corporation, (B) any Subsidiary of the Corporation, (C) any employee benefit plan or employee stock plan of the Corporation
or any Subsidiary of the Corporation, or any trust or other entity organized, appointed, established or holding Common Stock for
or pursuant to the terms of any such plan, (D) any person or group whose ownership of 5% or more of the Corporation’s then-outstanding
shares of Common Stock results solely from (i) any action or transaction or transactions approved by the Corporation’s Board
of Directors before such person or group became an Acquiring Person or (ii) a reduction in the number of issued and outstanding
shares of the Corporation’s Common Stock pursuant to a transaction or transactions approved by the Corporation’s Board
of Directors (provided that any person or group that does not become an Acquiring Person by reason of clause (i) or (ii) above
shall become an Acquiring Person upon acquisition of any additional shares of the Corporation’s Common Stock unless such
acquisition of additional Common Stock will not result in such person or group becoming an Acquiring Person by reason of such clause
(i) or (ii)), (E) any Person that the Board of Directors determines is exempt from the Rights Agreement, which determination shall
be made in the sole and absolute discretion of the Board of Directors, or (F) any Person who or which, at the time of the first
public announcement of the Rights Agreement, is a Beneficial Owner of 5% or more of the Corporation’s Common Stock then outstanding
(a “Grandfathered Stockholder”); provided, however, that if a Grandfathered Stockholder
becomes, after such time, the Beneficial Owner of any additional shares of the Corporation’s Common Stock (regardless of
whether, thereafter or as a result thereof, there is an increase, decrease or no change in the percentage of shares of the Corporation’s
Common Stock then outstanding beneficially owned by such Grandfathered Stockholder) then such Grandfathered Stockholder shall be
deemed to be an Acquiring Person unless, upon such acquisition of Beneficial Ownership of additional shares of the Corporation’s
Common Stock, such Person is not the Beneficial Owner of 5% or more of the Corporation’s Common Stock then outstanding; provided,
further, that upon the first decrease of a Grandfathered Stockholder’s Beneficial Ownership below 5%, such Grandfathered
Stockholder shall cease to be a Grandfathered Stockholder and this clause (ii) shall have no further force or effect with
respect to such Person. For the avoidance of doubt, in the event that after the time of the first public announcement of this Rights
Agreement, any agreement, arrangement or understanding pursuant to which any Grandfathered Stockholder is deemed to be the Beneficial
Owner of shares of the Corporation’s Common Stock expires, terminates or no longer confers any benefit to or imposes any
obligation on the Grandfathered Stockholder, any direct or indirect replacement, extension or substitution of such agreement, arrangement
or understanding with respect to the same or different shares of the Corporation’s Common Stock that confers Beneficial Ownership
of shares of the Corporation’s Common Stock shall be considered the acquisition of Beneficial Ownership of additional shares
of the Corporation’s Common Stock by the Grandfathered Stockholder and render such Grandfathered Stockholder an Acquiring
Person for purposes of this Rights Agreement unless, upon such acquisition of Beneficial Ownership of additional shares of the
Corporation’s Common Stock, such Person is not the Beneficial Owner of 5% or more of the Corporation’s Common Stock
then outstanding.


 






    A-2


     


    

 


“Beneficial Ownership”
shall include any securities such Person or any of such Person’s Affiliates or Associates (a) beneficially owns, directly
or indirectly, within the meaning of Rules 13d-3 or 13d-5 promulgated under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), (b) has the right to acquire or vote pursuant to any agreement, arrangement or
understanding (except under limited circumstances), (c) which are directly or indirectly beneficially owned by any other Person
with which such Person has any agreement, arrangement or understanding for the purpose of acquiring, holding or voting such securities,
or obtaining, changing or influencing control of the Company, or with whom such Person is acting in concert or (d) in respect
of which such Person has a derivative position.


 


Until the Distribution Date (or earlier redemption
or expiration of the Rights), new Common Stock certificates issued after August
29, 2018 will contain a legend incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), transfer on the Corporation’s direct registration system of any Common Stock represented
by a Book-Entry or a certificate outstanding as of August 29, 2018,
and, in each case, with or without a copy of this Summary of Rights attached thereto, will also constitute the transfer of the
Rights associated with the Common Stock represented by such Book-Entry or certificate. As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights (“Rights Certificates”) will be mailed to holders of
record of the Common Stock as of the close of business on the Distribution Date and such separate Rights Certificates alone will
evidence the Rights from and after the Distribution Date.


 


The Rights are not exercisable until the
Distribution Date. Unless earlier redeemed by the Corporation as described below, the Rights will expire at the close of business
on August 29, 2021 (the “Expiration Date”) (or, if the Distribution Date shall have occurred before August 29, 2021,
at the close of business on the 90th day following the Distribution Date).


 


The Preferred Stock is non-redeemable and,
unless otherwise provided in connection with the creation of a subsequent series of preferred stock (i) subordinate to any other
series of the Corporation’s preferred stock and (ii) senior to the Common Stock. The Preferred Stock may not be issued except
upon exercise of Rights. Each outstanding share of Preferred Stock will be entitled to receive when, as and if declared, a quarterly
dividend in an amount equal to (i) 100 times the cash dividends declared on the Corporation’s Common Stock, and (ii) a preferential
cash dividend, if any, in preference to holders of Common Stock in an amount equal to $50.00 per share of Preferred Stock less
the per share amount of all cash dividends declared on the Preferred Stock pursuant to clause (i) since the immediately preceding
quarterly dividend payment date. In addition, Preferred Stock is entitled to 100 times any noncash dividends (other than dividends
payable in equity securities) declared on the Common Stock, in like kind. In the event of the liquidation of the Corporation, the
holders of Preferred Stock will be entitled to receive, for each share of Preferred Stock, a payment in an amount equal to the
greater of $1.00 per one one-hundredth of a share plus accrued and unpaid dividends and distributions thereon or 100 times the
payment made per share of Common Stock. Each share of Preferred Stock will have 100 votes, voting together with the Common Stock.
In the event of any merger, consolidation or other transaction in which Common Stock is exchanged, each share of Preferred Stock
will be entitled to receive 100 times the amount received per share of Common Stock. The rights of Preferred Stock as to dividends,
liquidation and voting are protected by anti-dilution provisions. If the dividends accrued on the Preferred Stock for four or more
quarterly dividend periods, whether consecutive or not, shall not have been declared and paid or irrevocably set aside for payment,
the holder of record of the Preferred Stock of the Corporation of all series (including the Preferred Stock) will have the right
to elect two members to the Corporation’s Board of Directors.


 






    A-3


     


    

 


The number of shares of Preferred Stock issuable
upon exercise of the Rights is subject to certain adjustments from time to time in the event of a stock dividend on, or a subdivision
or combination of, the Common Stock. The Exercise Price for the Rights is subject to adjustment in the event of extraordinary distributions
of cash or other property to holders of Common Stock.


 


Unless the Rights are earlier redeemed, in
the event that, after the time that a Person becomes an Acquiring Person, the Corporation were to be acquired in a merger or other
business combination (in which any shares of Common Stock are changed into or exchanged for other securities or assets) or more
than 50% of the assets or Earning Power (as defined in the Rights Agreement) of the Corporation and its subsidiaries (taken as
a whole) were to be sold or transferred in one or a series of related transactions, the Rights Agreement provides that proper provision
will be made so that each holder of record, other than the Acquiring Person, of a Right will from and after such date have the
right to receive, upon payment of the Exercise Price, that number of shares of common stock of the acquiring company having a market
value at the time of such transaction equal to two times the Exercise Price.


 


In addition, unless the Rights are earlier
redeemed, in the event that a person or group becomes an Acquiring Person, the Rights Agreement provides that proper provision
will be made so that each holder of record of a Right, other than the Acquiring Person (whose Rights will thereupon become null
and void), will thereafter have the right to receive, upon payment of the Exercise Price, that number of one one-hundredths of
a share of Preferred Stock having a market value at the time of the transaction equal to two times the Exercise Price (such market
value to be determined with reference to the market value of the Corporation’s Common Stock as provided in the Rights Agreement).


 


At any time after any person or group becomes
an Acquiring Person and prior to the acquisition by such person or group of 50% or more of the outstanding voting stock, the Board
of Directors of the Corporation may exchange the Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock per Right (subject to adjustment).


 


Fractions of shares of Preferred Stock (other
than fractions which are integral multiples of one one-hundredth of a share) may, at the election of the Corporation, be evidenced
by depositary receipts. The Corporation may also issue cash in lieu of fractional shares which are not integral multiples of one
one-hundredth of a share.


 


At any time on or prior to the close of business
on the earlier of (i) the tenth day after the Stock Acquisition Date (or such later date as a majority of the Board of Directors
may determine) or (ii) the Expiration Date, the Corporation may redeem the Rights in whole, but not in part, at a price of $0.01
per Right (the “Redemption Price”). Immediately upon the effective time of the action of the Board of
Directors of the Corporation authorizing redemption of the Rights, the right to exercise the Rights will terminate and the only
right of the holders of Rights will be to receive the Redemption Price.


 






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For as long as the Rights are then redeemable,
the Corporation may, amend the Rights in any manner, including an amendment to extend the time period in which the Rights may be
redeemed. At any time when the Rights are not then redeemable, the Corporation may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the Rights as such.


 


Until a Right is exercised, the holder, as
such, will have no rights as a stockholder of the Corporation, including, without limitation, the right to vote or to receive dividends.


 


A copy of the Rights Agreement will be filed
with the Securities and Exchange Commission as an exhibit to a current report on Form 8-K. 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 incorporated in this summary description herein by reference.


 




    A-5


     


    

 


EXHIBIT B


 


TO RIGHTS AGREEMENT


 


[Form of Rights Certificate]


 


	Certificate No. W 	 _________Rights




 


NOT EXERCISABLE AFTER (I)
___________, 2021, OR (II) IF THE DISTRIBUTION DATE (AS DEFINED BELOW) SHALL HAVE OCCURRED BEFORE THE DATE SPECIFIED IN CLAUSE
(I), THE DATE WHICH IS NINETY (90) DAYS AFTER ______________, 2021, OR EARLIER IF REDEEMED. THE RIGHTS ARE SUBJECT TO REDEMPTION,
AT THE OPTION OF THE COMPANY AND UNDER CERTAIN OTHER CIRCUMSTANCES, AT $0.01 PER RIGHT (SUBJECT TO ADJUSTMENT), ON THE TERMS SET
FORTH OR REFERRED TO IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN THE RIGHTS AGREEMENT (AS REFERRED TO BELOW),
RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.


 


Rights Certificate


 


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 August
29, 2018 (the “Rights Agreement”) between TSR, Inc. (the “Corporation”) and Continental Stock Transfer
& Trust Company, (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. (New York City time) on August 29, 2021 (or if the Distribution
Date shall have occurred before August 29, 2021, at the close of business on the 90th day following the Distribution Date) at the
office of the Rights Agent designated in the Rights Agreement for such purpose, or its successor as Rights Agent, in New York,
New York, one one-hundredth (1/100th) of a fully paid nonassessable share of Class A Preferred Stock, Series One, $1.00 par value
per share, of the Corporation (the “Preferred Stock”) at a purchase price of $24.78, as the same may from time to time
be adjusted in accordance with the Rights Agreement (the “Exercise Price”), upon presentation and surrender of this
Rights Certificate with the Form of Election to Purchase attached hereto duly executed.


 


As provided in the Rights Agreement, the
Exercise Price and the number of shares of Preferred Stock which may be purchased upon the exercise of the Rights evidenced by
this Rights Certificate are subject to modification and adjustment upon the happening of certain events and, upon the happening
of certain events, securities other than shares of Preferred Stock, or other property, may be acquired upon exercise of the Rights
evidenced by this Rights Certificate, as provided in the Rights Agreement.


 






    B-1


     


    

 


This Rights Certificate is subject to all
of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are 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 of the Rights Agent, the Corporation and the holders of record of Rights
Certificates. Copies of the Rights Agreement are on file at the principal executive office of the Corporation.


 


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


 


Subject to the provisions of the Rights Agreement,
the Rights evidenced by this Certificate may be redeemed by the Corporation at its option or under certain other circumstances
at a redemption price of $0.01 per Right. No fractional shares of Preferred Stock (other than fractions which are integral multiples
of one one-hundredth (1/100th) of a share) are required to be issued upon the exercise of any Right or Rights evidenced hereby,
and in lieu thereof the Corporation may cause depositary receipts to be issued and/or a cash payment may be made, as provided in
the Rights Agreement.


 


No holder of this Rights Certificate, as
such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of Preferred Stock or of any other
securities of the Corporation which may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a stockholder of the Corporation
or any right to vote for the election of directors or upon any matter submitted to stockholders at a meeting thereof, or to give
or withhold consent to any corporate action or to receive notice of meetings or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced
by this Rights Certificate shall have been exercised as provided in the Rights Agreement. This Rights Certificate shall not be
valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.


 




    B-2


     


    

 


WITNESS the facsimile signature of the proper
officers of the Corporation and its corporate seal. Dated as of _____________________.


 


ATTEST:


 


	 	 	By:	 
	Secretary	 	Title:	 


 


Countersigned:


 


[RIGHTS AGENT]


 


	By:	 	 



 



    B-3


     


    

 


[Form of Reverse Side of Rights Certificate]


 


FORM OF ASSIGNMENT


 


(To be executed by the registered holder
if such holder desires to transfer the Rights Certificates.)


 


FOR VALUE RECEIVED ________________________________hereby
 sells, assigns and transfers unto _________________________(Please print name and address of transferee) _____________________________________Rights
evidenced by this Rights Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute
and appoint ______________________________ Attorney to transfer the within Rights Certificate on the books of the within-named
Corporation, with full power of substitution.


 


Dated: 


 


	 	 	 
	 	Signature


 


Signature Guaranteed:


 




    B-4


     


    

 


Certificate


 


The undersigned hereby certifies by checking
the appropriate boxes that:


 


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


 


(2) after
due inquiry and to the best knowledge of the undersigned, it [___] did [___] did not acquire the Rights evidenced by this Rights
Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or Associate thereof (as such
terms are defined in the Rights Agreement).


 


	Dated: 	 	 	 
	 	 	 	Signature


 


NOTICE


 


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


 




    B-5


     


    

 


FORM OF ELECTION TO PURCHASE


 


(To be executed if registered holder

desires to exercise the Rights Certificate.)


 


TO: ___________________


 


The undersigned hereby irrevocably elects
to exercise Rights represented by this Rights Certificate to purchase the shares of Preferred Stock issuable upon the exercise
of such Rights and requests that certificates for such share(s) be issued in the following name:


 


Please insert social security or other identifying
number: _____________________________________________

_______________________________________________________________________________________________

(Please print name and address)


 


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


 


Please insert social security or other identifying
number: _____________________________________________

_______________________________________________________________________________________________

(Please print name and address)


 


Dated: _______________________


 


	 	 
	 	Signature
	 	 
	 	(Signature must conform in all respects to name of holder as specified on the face of this Rights Certificate)


 


Signature Guaranteed


 




    B-6


     


    

 


EXHIBIT C


 


TO RIGHTS AGREEMENT


 


FORM OF CERTIFICATE OF DESIGNATIONS

OF

CLASS A PREFERRED STOCK, SERIES ONE

OF

TSR, INC.


 


I, Christopher Hughes, President and Chief
Executive Officer of TSR, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation
Law of the State of Delaware (the “Act”), in accordance with provision 103 of the Act, DO HEREBY CERTIFY that: pursuant
to the authority conferred upon the Board of Directors by the Certificate of Incorporation of the Corporation, as amended, and
pursuant to the Act the Board of Directors on August 29, 2018 adopted
the following resolution which creates a series of thirty thousand (30,000) shares of Preferred Stock designated as Class A Preferred
Stock, Series One.


 


RESOLVED, that pursuant to the authority
vested in the Board of Directors of the Corporation in accordance with the provisions of its Certificate of Incorporation, as amended,
a series of Preferred Stock of the Corporation be, and hereby is, created and that the designation and amount thereof and the voting
powers, preferences and relative, participating, optional or other special rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:


 


Section 1.   
Designation and Amount. The shares of such series shall be designated as “Class A Preferred Stock, Series One”
(the “Series One Preferred Stock”) and the number of shares constituting such series shall be thirty thousand (30,000).


 






    C-1


     


    

 


Section 2.   
Dividends and Distributions.


 


(A) Subject
to the provisions for adjustment hereinafter set forth, the holders of shares of Series One Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, (i) cash dividends
in an amount per share (rounded to the nearest cent) equal to 100 times the aggregate per share amount of all cash dividends declared
or paid on the Common Stock, $0.01 par value per share, of the Corporation (the “Common Stock”) and (ii) a preferential
cash dividend (the “Preferential Dividends”), if any, on the first day of March, June, September and December of each
year (each 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 One Preferred Stock, in an amount (except in the case of the first Quarterly
Dividend Payment Date if the date of the first issuance of Series One Preferred Stock is a date other than a Quarterly Dividend
Payment Date, in which case such payment shall be a prorated amount of such amount) equal to $50.00 per share of Series One Preferred
Stock less the per share amount of all cash dividends declared on the Series One Preferred Stock pursuant to clause (i) of this
sentence 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 One Preferred Stock. In the event the Corporation
shall, at any time after the issuance of any share or fraction of a share of Series One Preferred Stock, make any distribution
on the shares of Common Stock of the Corporation, whether by way of a dividend or a reclassification of stock, a recapitalization,
reorganization or partial liquidation of the Corporation or otherwise, which is payable in cash or any debt security, debt instrument,
real or personal property or any other property (other than cash dividends subject to the immediately preceding sentence, a distribution
of shares of Common Stock or other capital stock of the Corporation or a distribution of rights or warrants to acquire any such
share, including any debt security convertible into or exchangeable for any such share, at a price less than the Fair Market Value
(as hereinafter defined) of such share), then, and in each such event the Corporation shall simultaneously pay on each then outstanding
share of Series One Preferred Stock of the Corporation a distribution, in like kind, of 100 times such distribution paid on a share
of Common Stock (subject to the provisions for adjustment hereinafter set forth). The dividends and distributions on the Series
One Preferred Stock to which holders thereof are entitled pursuant to clause (i) of the first sentence of this paragraph and pursuant
to the second sentence of this paragraph are hereinafter referred to as “Participating Dividends” and the multiple
of such cash and noncash dividends on the Common Stock applicable to the determination of the Participating Dividends, which shall
be 100 initially but shall be adjusted from time to time as hereinafter provided, is hereinafter referred to as the “Dividend
Multiple.” In the event the Corporation shall at any time after August
29, 2018 (the “Effective Date”) declare or pay any dividend or make any distribution on Common Stock payable
in shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding
shares of Common Stock into a greater or lesser number of shares of Common Stock, or issue any of its capital stock in a reclassification
of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Corporation
is the continuing or surviving corporation), then in each such case the Dividend Multiple thereafter applicable to the determination
of the amount of Participating Dividends which holders of shares of Series One Preferred Stock shall be entitled to receive shall
be the Dividend Multiple applicable immediately prior to such event multiplied by a fraction the numerator of which is the number
of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.


 


(B) The
Corporation shall declare each Participating Dividend at the same time it declares any cash or non-cash dividend or distribution
on the Common Stock in respect of which a Participating Dividend is required to be paid. No cash or noncash dividend or distribution
on the Common Stock in respect of which a Participating Dividend is required to be paid shall be paid or set aside for payment
on the Common Stock unless a Participating Dividend in respect of such dividend or distribution on the Common Stock shall be simultaneously
paid, or set aside for payment, on the Series One Preferred Stock.


 






    C-2


     


    

 


(C) Preferential
Dividends shall begin to accrue on outstanding shares of Series One Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issuance of any shares of Series One Preferred Stock. Accrued but unpaid Preferential Dividends shall cumulate
but shall not bear interest. Preferential Dividends paid on the shares of Series One 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.


 


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


 


(A) Subject
to the provisions for adjustment hereinafter set forth, each share of Series One Preferred Stock shall entitle the holder thereof
to 100 votes on all matters submitted to a vote of the stockholders of the Corporation. The number of votes which a holder of Series
One Preferred Stock is entitled to cast, as the same may be adjusted from time to time as hereinafter provided, is hereinafter
referred to as the “Vote Multiple.” In the event the Corporation shall at any time after the Effective Date declare
or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or split or a combination, consolidation
or reverse split of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, or issue
any of its capital stock in a reclassification of the Common Stock (including any such reclassification in connection with a consolidation
or merger in which the Corporation is the continuing or surviving corporation), then in each such case the Vote Multiple thereafter
applicable to the determination of the number of votes per share to which holders of shares of Series One Preferred Stock shall
be entitled after such event shall be the Vote Multiple immediately prior to such event multiplied by a fraction the numerator
of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to such event.


 


(B) Except
as otherwise provided herein, in the Certificate of Incorporation, as amended, or Amended and Restated By-Laws, as amended, the
holders of shares of Series One Preferred Stock and the holders of shares of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.


 


(C) In
the event that the Preferential Dividends accrued on the Series One Preferred Stock for four or more quarterly dividend periods,
whether consecutive or not, shall not have been declared and paid or set apart for payment, the holders of record of Preferred
Stock of the Corporation of all series (including the Series One Preferred Stock), other than any series in respect of which such
right is expressly withheld by the Certificate of Incorporation, as amended, or the authorizing resolutions included in the Certificate
of Designations therefor, shall have the right, at the next meeting of stockholders called for the election of directors, to elect
two members to the Board of Directors, which directors shall be in addition to the number required by the Amended and Restated
By-Laws prior to such event, to serve until the next Annual Meeting and until their successors are elected and qualified or their
earlier resignation, removal or incapacity or until such earlier time as all accrued and unpaid Preferential Dividends upon the
outstanding shares of Series One Preferred Stock shall have been paid (or irrevocably set aside for payment) in full. The holders
of shares of Series One Preferred Stock shall continue to have the right to elect directors as provided by the immediately preceding
sentence until all accrued and unpaid Preferential Dividends upon the outstanding shares of Series One Preferred Stock shall have
been paid (or set aside for payment) in full. Such directors may be removed and replaced by such stockholders, and vacancies in
such directorships may be filled only by such stockholders (or by the remaining directors elected by such stockholders, if there
be any) in the manner permitted by law; provided, however, that any such action by stockholders shall be taken at a meeting of
stockholders and shall not be taken by written consent thereto.


 






    C-3


     


    

 


(D) Except
as otherwise required by the Certificate of Incorporation, as amended, or the Amended and Restated By-laws, as amended, or set
forth herein, holders of Series One Preferred Stock shall have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for the taking of any corporate
action.


 


Section 4.   
Certain Restrictions.


 


(A) Whenever
Preferential Dividends or Participating Dividends are in arrears or the Corporation shall be in default of payment thereof, thereafter
and until all accrued and unpaid Preferential Dividends and Participating Dividends, whether or not declared, on shares of Series
One Preferred Stock outstanding shall have been paid or set aside for payment in full, and in addition to any and all other rights
which any holder of shares of Series One Preferred Stock may have in such circumstances, the Corporation shall not:


 


(i) declare
or pay dividends on, make any other distributions on, or redeem or purchase or otherwise acquire for consideration, any shares
of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series One Preferred Stock;


 


(ii) declare
or pay dividends on or make any other distributions on any shares of stock ranking on a parity as to dividends with the Series
One Preferred Stock, unless dividends are paid ratably on the Series One 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 if the full
dividends accrued thereon were to be paid;


 


(iii) except
as permitted by subparagraph (iv) of this paragraph 4(A), redeem or purchase or otherwise acquire for consideration shares of any
stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series One Preferred
Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such parity stock in exchange
for shares of any stock of the Corporation ranking junior (both as to dividends and upon liquidation, dissolution or winding up)
to the Series One Preferred Stock; or


 


(iv) purchase
or otherwise acquire for consideration any shares of Series One Preferred Stock, or any shares of stock ranking on a parity with
the Series One Preferred Stock (either as to dividends or upon liquidation, dissolution or winding up), except in accordance with
a purchase offer made 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.


 


(B) The
Corporation shall not permit any Subsidiary (as hereinafter defined) of the Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise
acquire such shares at such time and in such manner. A “Subsidiary” of the Corporation shall mean any corporation or
other entity of which securities or other ownership interests having ordinary voting power sufficient to elect a majority of the
Board of Directors or other persons performing similar functions are Beneficially Owned, directly or indirectly, by the Corporation
or by any corporation or other entity that is otherwise controlled by the Corporation.


 






    C-4


     


    

 


(C) The
Corporation shall not issue any shares of Series One Preferred Stock except upon exercise of Rights issued pursuant to that certain
Rights Agreement dated as of August 29, 2018 between the Corporation
and Continental Stock Transfer & Trust Company, a copy of which is on file with the Secretary of the Corporation at its principal
executive office and shall be made available to stockholders of record without charge upon written request therefor addressed to
said Secretary. Notwithstanding the foregoing sentence, nothing contained in the provisions hereof shall prohibit or restrict the
Corporation from issuing for any purpose, any series of Preferred Stock with rights and privileges similar to, different from,
or greater than, those of the Series One Preferred Stock.


 


Section 5.   
Reacquired Shares. Any shares of Series One 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 upon their retirement
and cancellation shall become authorized but unissued shares of Preferred Stock, without designation as to series, and such shares
may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors.


 


Section 6.   
Liquidation, Dissolution or Winding Up. Upon any voluntary or involuntary liquidation, dissolution or winding up
of the Corporation, no distribution shall be made (i) to the holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series One Preferred Stock unless the holders of shares of Series One Preferred
Stock shall have received, subject to adjustment as hereinafter provided, (A) $100 ($1.00 per one one-hundredth of a share) plus
an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment,
or (B) if greater than the amount specified in clause (i)(A) of this sentence, an amount equal to 100 times the aggregate amount
to be distributed per share to holders of Common Stock, as the same may be adjusted as hereinafter provided, and (ii) to the holders
of stock ranking on a parity upon liquidation, dissolution or winding up with the Series One Preferred Stock, unless simultaneously
therewith distributions are made ratably on the Series One Preferred Stock and all other shares of such parity stock in proportion
to the total amounts to which the holders of shares of Series One Preferred Stock are entitled under clause (i)(A) of this sentence
and to which the holders of such parity shares are entitled, in each case upon such liquidation, dissolution or winding up. The
amount to which holders of Series One Preferred Stock may be entitled upon liquidation, dissolution or winding up of the Corporation
pursuant to clause (i)(B) of the foregoing sentence is hereinafter referred to as the “Participating Liquidation Amount”
and the multiple of the amount to be distributed to holders of shares of Common Stock upon the liquidation, dissolution or winding
up of the Corporation applicable pursuant to said clause to the determination of the Participating Liquidation Amount, as said
multiple may be adjusted from time to time as hereinafter provided, is hereinafter referred to as the “Liquidation Multiple.”
In this event the Corporation shall at any time after the Effective Date declare or pay any dividend on Common Stock payable in
shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding shares
of Common Stock into a greater or lesser number of shares of Common Stock, or issue any of its capital stock in a reclassification
of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Corporation
is the continuing or surviving corporation, then in each such case the Liquidation Multiple thereafter applicable to the determination
of the Participating Liquidation Amount to which holders of Series One Preferred Stock shall be entitled after such event shall
be the Liquidation Multiple applicable immediately prior to such event multiplied 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.


 






    C-5


     


    

 


Section 7. Certain
Reclassifications and Other Events.


 


(A) In
the event that holders of shares of Common Stock of the Corporation receive after the Effective Date, in respect of their shares
of Common Stock any share of capital stock of the Corporation (other than any share of Common Stock of the Corporation), whether
by way of reclassification, recapitalization, reorganization, dividend or other distribution or otherwise (a “Transaction”),
then, and in each such event the dividend rights, voting rights and rights upon the liquidation, dissolution or winding up of the
Corporation of the shares of Series One Preferred Stock shall be adjusted so that after such event the holders of Series One Preferred
Stock shall be entitled, in respect of each share of Series One Preferred Stock held, in addition to such rights in respect thereof
to which such holder was entitled immediately prior to such adjustment, to (i) such additional dividends as equal the Dividend
Multiple in effect immediately prior to such Transaction multiplied by the additional dividends which the holder of a share of
Common Stock shall be entitled to receive by virtue of the receipt in the Transaction of such capital stock, (ii) such additional
voting rights as equal the Vote Multiple in effect immediately prior to such Transaction multiplied by the additional voting rights
which the holder of a share of Common Stock shall be entitled to receive by virtue of the receipt in the Transaction of such capital
stock and (iii) such additional distributions upon liquidation, dissolution or winding up of the Corporation as equal the Liquidation
Multiple in effect immediately prior to such Transaction multiplied by the additional amount which the holder of a share of Common
Stock shall be entitled to receive upon liquidation, dissolution or winding up of the Corporation by virtue of the receipt in the
Transaction of such capital stock, as the case may be, all as provided by the terms of such capital stock.


 


(B) In
the event that holders of shares of Common Stock of the Corporation receive after the Effective Date, in respect of their shares
of Common Stock any right or warrant to purchase Common Stock (including as such a right, for all purposes of this paragraph, any
security convertible into or exchangeable for Common Stock) at a purchase price per share less than the Fair Market Value (as hereinafter
defined) of a share of Common Stock on the date of issuance of such right or warrant, then and in each such event the dividend
rights, voting rights and rights upon the liquidation, dissolution or winding up of the Corporation of the shares of Series One
Preferred Stock shall each be adjusted so that after such event the Dividend Multiple, the Vote Multiple and the Liquidation Multiple
shall each be the product of the Dividend Multiple, the Vote Multiple and the Liquidation Multiple, as the case may be, in effect
immediately prior to such event multiplied by a fraction the numerator of which shall be the number of shares of Common Stock outstanding
immediately before such issuance of rights or warrants plus the maximum number of shares of Common Stock which could be acquired
upon exercise in full of all such rights or warrants and the denominator of which shall be the number of shares of Common Stock
outstanding immediately before such issuance of rights or warrants plus the number of shares of Common Stock which could be purchased,
at the Fair Market Value of the Common Stock at the time of such issuance, by the maximum aggregate consideration payable upon
exercise in full of all such rights or warrants.


 






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(C) In
the event that holders of shares of Common Stock of the Corporation receive after the Effective Date in respect of their shares
of Common Stock any right or warrant to purchase capital stock of the Corporation (other than shares of Common Stock), including
as such a right, for all purposes of this paragraph, any security convertible into or exchangeable for capital stock of the Corporation,
(other than Common Stock), at a purchase price per share less than the Fair Market Value of such shares of capital stock on the
date of issuance of such right or warrant, then and in each such event the dividend rights, voting rights and rights upon liquidation,
dissolution or winding up of the Corporation of the shares of Series One Preferred Stock shall each be adjusted so that after such
event each holder of a share of Series One Preferred Stock shall be entitled, in respect of each share of Series One Preferred
Stock held, in addition to such rights in respect thereof to which such holder was entitled immediately prior to such event, to
receive (i) such additional dividends as equal the Dividend Multiple in effect immediately prior to such event multiplied, first,
by the additional dividends to which the holder of a share of Common Stock shall be entitled upon exercise of such right or warrant
by virtue of the capital stock which could be acquired upon such exercise and multiplied again by the Discount Fraction (as hereinafter
defined) and (ii) such additional voting rights as equal the Vote Multiple in effect immediately prior to such event multiplied,
first, by the additional voting rights to which the holder of a share of Common Stock shall be entitled upon exercise of such right
or warrant by virtue of the capital stock which could be acquired upon such exercise and multiplied again by the Discount Fraction
and (iii) such additional distribution upon liquidation, dissolution or winding up of the Corporation as equal the Liquidation
Multiple in effect immediately prior to such event multiplied, first, by the additional amount which the holder of a share of Common
Stock shall be entitled to receive upon liquidation, dissolution or winding up of the Corporation upon exercise of such right or
warrant by virtue of the capital stock which could be acquired upon such exercise and multiplied again by the Discount Fraction.
For purposes of this paragraph, the “Discount Fraction” shall be a fraction the numerator of which shall be the difference
between the Fair Market Value of a share of the capital stock subject to a right or wan-ant distributed to holders of shares of
Common Stock of the Corporation as contemplated by this paragraph immediately after the distribution thereof and the purchase price
per share for such share of capital stock pursuant to such right or warrant and the denominator of which shall be the Fair Market
Value of a share of such capital stock immediately after the distribution of such right or warrant.


 


(D) For
purposes of this Certificate of Designations, the “Fair Market Value” of a share of capital stock of the Corporation
(including a share of Common Stock) on any date shall be deemed to be the average of the daily closing price per share thereof
over the 30 consecutive Trading Days (as such term is hereinafter defined) immediately prior to such date; provided, however, that,
in the event that such Fair Market Value of any such share of capital stock is determined during a period which includes any date
that is within 30 Trading Days after (i) the ex-dividend date for a dividend or distribution on stock payable in shares of such
stock or securities convertible into shares of such stock, or (ii) the effective date of any subdivision, split, combination, consolidation,
reverse stock split or reclassification of such stock, then, and in each such case, the Fair Market Value shall be appropriately
adjusted by the Board of Directors of the Corporation to take into account ex-dividend or post-effective date trading. 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 as reported in the applicable transaction reporting system with respect to securities
listed on the principal national securities exchange on which the shares are listed or admitted to trading or, if the shares are
not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average
of the high bid and low asked prices in the., over-the counter market, as reported by the NASDAQ Capital Market or such other system
then in use, or if on any such date the shares 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 shares selected by the Board of Directors of the Corporation.
The term “Trading Day” shall mean a day in which the principal national securities exchange on which the shares are
listed or admitted to trading is open for the transaction of business or, if the shares are not listed or admitted to trading on
any national securities exchange, on which the any such national securities exchange as may be selected by the Board of Directors
of the Corporation is open. If the shares are not publicly held or not so listed or traded on any day within the period of 30 Trading
Days applicable to the determination of Fair Market Value thereof as aforesaid, “Fair Market Value” shall mean the
fair market value thereof per share as determined in good faith by the Board of Directors of the Corporation. In either case referred
to in the foregoing sentence, the determination of Fair Market Value shall be described in a statement filed with the Secretary
of the Corporation.


 






    C-7


     


    

 


Section 8.   
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 each outstanding share of Series One Preferred Stock shall at the same time be similarly exchanged
for or changed into the aggregate amount of stock, securities, cash and/or other property (payable in like kind), as the case may
be, for which or into which each share of Common Stock is changed or exchanged multiplied by the highest of the Vote Multiple,
the Dividend Multiple or the Liquidation Multiple in effect immediately prior to such event.


 


Section 9.   
Effective Time of Adjustments.


 


(A) Adjustments
to the Series One Preferred Stock required by the provisions hereof shall be effective as of the time at which the event requiring
such adjustments occurs.


 


(B) The
Corporation shall give prompt written notice to each holder of a share of Series One Preferred Stock of the effect of any adjustment
to the voting rights, dividend rights or rights upon liquidation, dissolution or winding up of the Corporation of such shares required
by the provisions hereof. Notwithstanding the foregoing sentence, the failure of the Corporation to give such notice shall not
affect the validity of or the force or effect of or the requirement for such adjustment.


 




    C-8


     


    

 


Section 10.
No Redemption. The shares of Series One Preferred Stock shall not be redeemable at the option of the Corporation
or any holder thereof. Notwithstanding the foregoing sentence of this Section, the Corporation may acquire shares of Series One
Preferred Stock in any other manner permitted by law, the provisions hereof and the Certificate of Incorporation, as amended, of
the Corporation.


 


Section 11.
Ranking. Unless otherwise provided in the Certificate of Incorporation, as amended, of the Corporation or a Certificate
of Designations relating to a series of preferred stock of the Corporation established after the issuance of any share of Series
One Preferred Stock or any right, warrant, or option providing for the issuance thereof, the Series One Preferred Stock shall rank,
as to the payment of dividends and the distribution of assets on liquidation, dissolution or winding up, (i) junior to all other
series of the Corporation's Preferred Stock and (iv) senior to the Common Stock.


 


Section 12.
Amendment. The provisions hereof and the Certificate of Incorporation, as amended, of the Corporation shall not be
amended in any manner which would adversely affect the rights, privileges or powers of the Series One Preferred Stock without,
in addition to any other vote of stockholders required by law, the affirmative vote of the holders of two-thirds or more of the
outstanding shares of Series One Preferred Stock, voting together as a single class.


 


Section 13.
Fractional Shares. Series One Preferred Stock may be issued in fractions of a share (in one one-hundredths (1/100th)
of a share and integral multiples thereof) that shall entitle the holder thereof, 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 shares of Series One Preferred Stock.


 


IN WITNESS WHEREOF, I have executed
and subscribed this Certificate of Designations and do affirm the foregoing as true under the penalties of perjury this 29th
day of August, 2018.


 


	 	 	 
	 	Name: 	Christopher Hughes
	 	Title:	Chief Executive Officer


 






    C-9


     


    

 


Exhibit D


 


Conditional Resignation


 


FORM OF


 


CONDITIONAL LETTER OF RESIGNATION OF


MEMBER OF THE BOARD OF DIRECTORS OF TSR,
INC.


 


Dated: _________, 2019


 


The undersigned, a member
of the Board of Directors (the “Board”) of TSR, Inc., a Delaware corporation (the “Corporation”),
does hereby resign as a member of the Board, effective immediately upon, and conditioned upon, the satisfaction of the “Condition”
set forth below.


 


This letter of resignation
is executed and delivered to the Corporation in connection with the Corporation’s entry into the Settlement and Release Agreement
(the “Settlement Agreement”), dated as of August 30, 2019, made and entered into by and between the Corporation,
Zeff Capital, L.P., Zeff Holding Company, LLC and Daniel Zeff, QAR Industries, Inc. and Robert Fitzgerald, and Fintech Consulting,
LLC and Tajuddin Haslani. This letter of resignation is irrevocable and shall be held in escrow by the Corporation. As provided
in Section 3(c)(i) of the Settlement Agreement, this conditional resignation shall become effective as of 5:00 p.m., Eastern
Time, on December 30, 2019 (the “Effective Time”) if and only if the Repurchase and the payment of the Settlement
Payment (each as defined in the Settlement Agreement) are not completed by the Effective Time (the “Condition”).
If the Repurchase and the payment of the Settlement Payment are completed prior to the Effective Time, this conditional letter
of resignation shall not become effective, and the Corporation shall deem it null and void and of no further effect. If the Condition
is satisfied at the Effective Time, the Corporation shall insert December 30, 2019 as the effective date on the following page,
release this conditional letter of resignation from escrow and deliver it to the Board without any further action, including, without
limitation, notice to any person or entity, at which point this letter of resignation shall become effective.


 


[Signatures continue on following page] 


 




     


     


    

 


	EFFECTIVE DATE: __________________	 	MEMBER OF THE BOARD OF DIRECTORS OF TSR, INC.
	 	 	 
	 	 	 
	 	 	Name:


 


The undersigned hereby consents to the foregoing:


 


	TSR, INC.
	 
	By:_______________________________
	Name:  Christopher Hughes
	Title:    Chief Executive Officer


 






     


     


    

 


Exhibit E


 


Conditional Resignation


 


FORM OF 


 


CONDITIONAL LETTER OF RESIGNATION OF


MEMBER OF THE BOARD OF DIRECTORS OF TSR,
INC.


 


Dated: __________, 2019


 


The undersigned, a member
of the Board of Directors (the “Board”) of TSR, Inc., a Delaware corporation (the “Corporation”)
included on the Zeff Slate (as defined in the Settlement Agreement, which is defined herein), does hereby resign as a member of
the Board, effective immediately upon, and conditioned upon, the occurrence of, the “Effective Time” set forth
below.


 


This letter of resignation
is executed and delivered to the Corporation in connection with the Corporation’s entry into the Settlement and Release Agreement
(the “Settlement Agreement”), dated as of August 30, 2019, made and entered into by and between the Corporation,
Zeff Capital, L.P., Zeff Holding Company, LLC and Daniel Zeff, QAR Industries, Inc. and Robert Fitzgerald, and Fintech Consulting,
LLC and Tajuddin Haslani. This letter of resignation is irrevocable and shall be held in escrow by the Corporation. As provided
in Section 3(c)(ii) of the Settlement Agreement, this conditional resignation shall become effective as of the closing of
the Repurchase and the payment of the Settlement Payment (each as defined in the Settlement Agreement), if such closing and payment
occur by 5:00 p.m., Eastern Time, on December 30, 2019 (the “Condition”). The time and date upon which the Condition
is satisfied shall be the “Effective Time”. If the Condition is not satisfied at 5:00 p.m., Eastern Time, on
December 30, 2019, this conditional letter of resignation shall not become effective, and the Corporation shall deem it null and
void and of no further effect. If the Condition is satisfied, the Corporation shall insert the date upon which the Condition is
satisfied as the effective date on the following page, release this conditional letter of resignation from escrow and deliver it
to the Board without any further action, including, without limitation, notice to any person or entity, at which point this letter
of resignation shall become effective.


 


[Signatures continue on following page] 


 




     


     


    

 


	EFFECTIVE DATE: __________________	 	MEMBER OF THE BOARD OF DIRECTORS OF TSR, INC.
	 	 	 
	 	 	 
	 	 	Name:


 


The undersigned hereby consents to the foregoing:


 


	TSR, INC.
	 
	By:_______________________________
	Name:  Christopher Hughes
	Title:    Chief Executive Officer


 






     


     


    

 


Exhibit F


 


Press Release


 


TSR, Inc. Enters into Settlement Agreement
with Investor Parties


 


Parties Agree to Dismiss Pending Litigation
and Settle All Disputes


 


Parties Enter into Plan to Resolve Proxy
Contest


 


Zeff Capital, L.P. to Withdraw Its Nomination
of Directors and Stockholder Proposals in Connection with TSR’s Commitments  


 


Hauppauge, NY (August 30, 2019) –
TSR, Inc. (Nasdaq: TSRI), a provider of computer programming consulting services (“TSR” or the “Company”),
today announced that it has entered into a settlement and release agreement (the “Settlement Agreement”) with certain
investor parties including Zeff Capital, L.P., Zeff Holding Company, LLC and Daniel Zeff, QAR Industries, Inc. and Robert Fitzgerald,
and Fintech Consulting, LLC and Tajuddin Haslani (collectively, the “Investor Parties”) with respect to the previous
proxy contest and all disputes and pending litigation between the Company and the Investor Parties, including, without limitation:


 


(i) A
complaint for declaratory and injunctive relief for violations of the federal securities laws filed on December 21, 2018 by
the Company against the Investor Parties in the United States District Court in the Southern District of New York;


 


(ii) A
complaint to compel annual meeting of stockholders filed on August 7, 2019 by Zeff Capital, L.P. against the Company in the Delaware
Court of Chancery;


 


(iii)
Cross-claims relating to alleged breaches of fiduciary duties and for indemnification and contribution filed on July 26, 2019
by the Company against the Investor Parties in New York Supreme Court, Queens County; and


 


(iv) A
complaint relating to alleged breaches of fiduciary duties filed on November 1, 2018 by Fintech Consulting, LLC against the Company
in the Delaware Court of Chancery, which was previously dismissed voluntarily.


 


The Settlement Agreement does not resolve
the two pending litigations previously disclosed by the Company filed by TSR stockholder Susan Paskowitz.


 


Pursuant to the Settlement Agreement, the
Parties concurrently entered into a share repurchase agreement (the “Repurchase Agreement”) providing for the purchase
of the shares of common stock of the Company, par value $0.01 per share (“Common Stock”), beneficially owned by the
Investor Parties as of the date of the Settlement Agreement, by the Company and Christopher Hughes, the Chairman of the Board of
Directors of the Company (the “Board”), President and Chief Executive Officer of the Company, for an aggregate purchase
price of $5,956,712.50 in cash or $6.25 per share, subject to the terms and conditions contained in the Repurchase Agreement (the
“Repurchase”). In addition, the Company has agreed to make a payment of $1,543,287.50 to the Investor Parties for the
settlement of the pending litigation (the “Settlement Payment”).


 




     


     


    

  


In addition, pursuant to the Settlement
Agreement, TSR and the Investor Parties have agreed to take certain actions with respect to the governance of the Company and the
upcoming 2018 Annual Meeting. To reflect the governance terms of the Settlement Agreement, TSR will adopt an amendment to its by-laws
(the “By-Laws Amendment”) and an amended and restated Rights Agreement (the “Amended Rights Agreement”).


 


TSR and the Investor Parties have also
agreed that the Company shall hold its 2018 Annual Meeting on October 22, 2019. In connection with the 2018 Annual Meeting, the
Company will solicit proxies for two alternative Class I director slates for election at the 2018 Annual Meeting: one slate for
the Company’s nominees, and one slate for nominees selected by Zeff Capital, L.P. If the Company completes the Repurchase
and makes the Settlement Payment prior to the 2018 Annual Meeting, Zeff Capital, L.P. will withdraw its director slate from consideration
at the 2018 Annual Meeting. If the Repurchase is not completed or the Settlement Payment is not made prior to the 2018 Annual Meeting,
then the Company will withdraw its director slate and will support the slate proposed by Zeff Capital, L.P.


 


TSR and the Investor Parties have further
agreed that if the Repurchase is not completed or the Settlement Payment is not made as of 5:00 pm, Eastern Time, on December 30,
2019, all of the then-current members of the board of directors of the Company (other than the directors from elected at the 2018
annual meeting who were proposed by Zeff Capital, L.P.) will resign from the Company’s board of directors. If the Repurchase
is completed after the 2018 Annual Meeting and prior to December 30, 2019, the two directors nominated by Zeff Capital, L.P. will
resign from the Company’s board of directors.


 


The Company will seek financing in connection
with the Settlement Payment and the Repurchase. The complete Settlement Agreement, Repurchase Agreement, By-Laws Amendment and
Amended Rights Agreement will be included as exhibits to a Current Report on Form 8-K, which will be filed with the Securities
and Exchange Commission.


 


Christopher Hughes, Chairman of the Board,
President and Chief Executive Officer of TSR, said:


 


“The Board considered the significant
cost and uncertainty of prolonged litigation, as well as the continued instability and business disruption during the proxy contest,
and as a result, determined that an immediate resolution of the pending litigation and proxy contest is in the best interest of
our Company and all stakeholders. This Settlement Agreement will help ensure that TSR and its employees will be able to continue
to focus on serving customers and building on the Company’s financial and operational performance.”


 


Daniel Zeff, President and Managing Member
of Zeff Capital, L.P., said:


 


“We are glad to see an end to
this long-running dispute. We believe we have created significant value for all stockholders, and in particular are pleased with
the governance changes that the Board has adopted, which benefit all stockholders. While we continue to believe that the Company
has great growth potential, we recognize the costs to the Company and its stockholders from the on-going litigation and business
disruptions, as well as the risks going forward if the proxy contest continues. In light of this we are pleased with the terms
of the Settlement Agreement.”


 




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Forward-Looking Statements


 


Certain statements in this press release
which are not historical facts may constitute “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Words such as “anticipate,” “believe,” “demonstrate,”
“estimate,” “expect,” “forecast,” “intend,” “likely,” “may,”
“plan,” “should,” and “will,” and similar expressions identify forward-looking statements.
Such forward-looking statements are based upon the Company’s current plans, estimates and expectations and are not a representation
that such plans, estimates, or expectations will be achieved. Specifically, forward-looking statements in this document may include,
but are not limited to, the statements regarding the occurrence of the events contemplated under the Settlement Agreement and Repurchase
Agreement. These and other forward-looking statements involve known and unknown risks, uncertainties and other factors that are
difficult to predict and which may cause the actual events to differ materially from the expectations, intentions, beliefs, plans
or predictions of the future expressed or implied by such forward-looking statements. These risks, uncertainties and other factors
include, among others, the factors and matters described in the Company’s filings with the SEC, including, but not limited
to, the Company’s most recent Form 10-K, Forms 10-Q and Forms 8-K, which are available at www.sec.gov. The forward-looking
statements included in this press release are made only as of the date of this press release and we do not undertake any obligation
to publicly update any forward-looking statements to reflect subsequent events or circumstances, except as required by law. Readers
are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.


 


 


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