Document:

Exhibit 10.20

 

REGISTRATION
RIGHTS AGREEMENT

 

This
Registration Rights Agreement (this “Agreement”) is made and entered into as of December [●], 2015, between
Creative Realities, Inc., a Minnesota corporation (the “Company”), and each of the several purchasers
signatory hereto (each such purchaser, a “Purchaser” and, collectively, the “Purchasers”).
This Agreement is made pursuant to the Securities Purchase Agreement, dated as of the date hereof, between the Company and each
Purchaser (collectively referred to, together with all other Securities Purchase Agreements in substantially similar form, as
the “Purchase Agreement”). The Company and each Purchaser hereby agrees as follows:

 

1.           Definitions.

 

Capitalized
terms used and not otherwise defined herein that are defined in the Purchase Agreement shall have the meanings given such terms
in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings:

 

“Advice”
shall have the meaning set forth in Section 6(d).

 

“Effectiveness
Date” means, with respect to the Initial Registration Statement required to be filed hereunder, the 135th calendar day
following the date hereof, and with respect to any additional Registration Statements which may be required pursuant to Section
2(c) or Section 3(c), the 135th calendar day following the date on which an additional Registration Statement is required to be
filed hereunder.

 

“Effectiveness
Period” shall have the meaning set forth in Section 2(a).

 

“Filing
Date” means, with respect to the Initial Registration Statement required hereunder, the 45th calendar day following
the date hereof, and with respect to any additional Registration Statements which may be required pursuant to Section 2(c) or
Section 3(c), a date on which the Company is permitted by SEC Guidance to file such additional Registration Statement related
to the Registrable Securities.

 

“Holder”
or “Holders” means the holder or holders, as the case may be, from time to time of Registrable Securities.

 

“Indemnified
Party” shall have the meaning set forth in Section 5(c).

 

“Indemnifying
Party” shall have the meaning set forth in Section 5(c).

 

“Initial
Registration Statement” means the initial Registration Statement filed pursuant to this Agreement.

 

“Losses”
shall have the meaning set forth in Section 5(a).

 

“Plan
of Distribution” shall have the meaning set forth in Section 2(a).

 

     

     

    

 

“Prospectus”
means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated
by the Commission pursuant to the Securities Act of 1933, as amended (the “Securities Act”)), as amended or
supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities
covered by a Registration Statement, and all other amendments and supplements to the Prospectus, including post-effective amendments,
and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.

 

“Registrable
Securities” means, as of any date of determination, (a) all Conversion Shares then issued and issuable upon conversion
of the Notes (including additional Notes issued pursuant to the Purchase Agreement), (b) all Warrant Shares then issued and issuable
upon exercise of the Warrants, (c) any additional shares of Common Stock issued and issuable in connection with any anti-dilution
provisions in the Notes or the Warrants (in each case, without giving effect to any limitations on conversion set forth in the
Notes or limitations on exercise set forth in the Warrants) and (d) any securities issued or then issuable upon any stock split,
dividend or other distribution, recapitalization or similar event with respect to the foregoing; provided, however,
that any such Registrable Securities shall cease to be Registrable Securities (and the Company shall not be required to maintain
the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) for so long as (a) a Registration
Statement with respect to the sale of such Registrable Securities is declared effective by the Commission under the Securities
Act and such Registrable Securities have been disposed of by the Holder in accordance with such effective Registration Statement,
(b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) such securities become eligible
for resale without volume or manner-of-sale restrictions and without current public information pursuant to Rule 144 as set forth
in a written opinion letter to such effect, addressed, delivered and acceptable to the transfer agent for the Company’s
Common Stock and the affected Holders (assuming that such securities and any securities issuable upon exercise, conversion or
exchange of which, or as a dividend upon which, such securities were issued or are issuable, were at no time held by any Affiliate
of the Company, and all Warrants are exercised by “cashless exercise” as provided in Section 1(c) of each of the Warrants),
as reasonably determined by the Company, upon the advice of counsel to the Company.

 

“Registration
Statement” means any registration statement required to be filed hereunder pursuant to Section 2(a) and any additional
registration statements contemplated by Section 2(c) or Section 3(c), including (in each case) the Prospectus, amendments and
supplements to any such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by reference in any such registration statement.

 

“Rule
415” means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.

 

    	 	2	 

     

    

 

“Rule
424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.

 

“Selling
Shareholder Questionnaire” shall have the meaning set forth in Section 3(a).

 

“SEC
Guidance” means (i) any publicly available written or oral guidance of the Commission staff, or any comments, requirements
or requests of the Commission staff and (ii) the Securities Act.

 

2.           Initial
Registration.

 

(a)          On or prior to the Filing Date, the Company shall prepare and file with the Commission a Registration Statement covering the resale
of all of the Registrable Securities for an offering to be made on a continuous basis pursuant to Rule 415. The Registration Statement
filed hereunder shall be on Form S-3 (except if the Company is not then eligible to register for resale the Registrable Securities
on Form S-3, in which case such registration shall be on another appropriate form in accordance herewith, subject to the provisions
of Section 2(d)) and shall contain (unless otherwise directed by at least 85% in interest of the Holders not otherwise affiliated
with the Company) substantially the “Plan of Distribution” attached hereto as Annex A. Subject to the
terms of this Agreement, the Company shall use its commercially reasonable efforts to cause a Registration Statement filed under
this Agreement (including, without limitation, under Section 3(c)) to be declared effective under the Securities Act as promptly
as possible after the filing thereof, but in any event no later than the applicable Effectiveness Date, and shall use its best
efforts to keep such Registration Statement continuously effective under the Securities Act until all Registrable Securities covered
by such Registration Statement (i) have been sold, thereunder or pursuant to Rule 144, or (ii) may be sold without volume or manner-of-sale
restrictions pursuant to Rule 144 and without the requirement for the Company to be in compliance with the current public information
requirement under Rule 144, as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed
and acceptable to the transfer agent for the Company’s Common Stock and the affected Holders (the “Effectiveness
Period”). The Company shall telephonically request effectiveness of a Registration Statement as of 5:00 p.m. Eastern
Time on a Trading Day. The Company shall, by 9:30 a.m. Eastern Time on the Trading Day after the effective date of such Registration
Statement, file a final Prospectus with the Commission as required by Rule 424.

 

    	 	3	 

     

    

 

(b)          Notwithstanding the registration obligations set forth in Section 2(a), if the Commission informs the Company that all of the
Registrable Securities cannot, as a result of the application of Rule 415, be registered for resale as a secondary offering on
a single registration statement, the Company agrees to promptly inform each of the Holders thereof and use its commercially reasonable
efforts to file amendments to the Initial Registration Statement as required by the Commission, covering the maximum number of
Registrable Securities permitted to be registered by the Commission, on Form S-3 or such other form available to register for
resale the Registrable Securities as a secondary offering, subject to the provisions of Section 2(d) with respect to filing on
Form S-3 or other appropriate form.

 

(c)          Notwithstanding any other provision of this Agreement, if the Commission or any SEC Guidance sets forth a limitation on the number
of Registrable Securities permitted to be registered on a particular Registration Statement as a secondary offering (and notwithstanding
that the Company used diligent efforts to advocate with the Commission for the registration of all or a greater portion of Registrable
Securities), unless otherwise directed in writing by a Holder as to its Registrable Securities, the number of Registrable Securities
to be registered on such Registration Statement will be reduced as follows:

 

		a.	First,
                                         the Company shall reduce or eliminate any securities to be included by any Person other
                                         than a Holder;

 

		b.	Second,
                                         the Company shall reduce Registrable Securities represented by Warrant Shares (applied,
                                         in the case that some Warrant Shares may be registered, to the Holders on a pro rata
                                         basis based on the total number of unregistered Warrant Shares held by such Holders);
                                         and

 

		c.	Third,
                                         the Company shall reduce Registrable Securities represented by Conversion Shares (applied,
                                         in the case that some Conversion Shares may be registered, to the Holders on a pro rata
                                         basis based on the total number of unregistered Conversion Shares held by such Holders).

 

In
the event of a cutback hereunder, the Company shall give the Holder at least five Trading Days prior written notice along with
the calculations as to such Holder’s allotment. In the event the Company amends the Initial Registration Statement in accordance
with the foregoing, the Company will use its commercially reasonable efforts to file with the Commission, as promptly as allowed
by Commission or SEC Guidance provided to the Company or to registrants of securities in general, one or more registration statements
on Form S-3 or such other form available to register for resale those Registrable Securities that were not registered for resale
on the Initial Registration Statement, as amended.

 

(d)          If Form S-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register
the resale of the Registrable Securities on another appropriate form and (ii) undertake to register the Registrable Securities
on Form S-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Registration
Statement then in effect until such time as a Registration Statement on Form S-3 covering the Registrable Securities has been
declared effective by the Commission.

 

    	 	4	 

     

    

 

3.           Registration
Procedures.

 

In
connection with the Company’s registration obligations hereunder, the Company shall:

 

(a)          Not less than five Trading Days prior to the filing of each Registration Statement and not less than one Trading Day prior to
the filing of any related Prospectus or any amendment or supplement thereto (including any document that would be incorporated
or deemed to be incorporated therein by reference), the Company shall (i) furnish to each Holder copies of all such documents
proposed to be filed, which documents (other than those incorporated or deemed to be incorporated by reference) will be subject
to the review of such Holders, and (ii) cause its officers and directors, counsel and independent registered public accountants
to respond to such inquiries as shall be necessary, in the reasonable opinion of respective counsel to each Holder, to conduct
a reasonable investigation within the meaning of the Securities Act. Notwithstanding the above, the Company shall not be obligated
to provide the Holders advance copies of any universal shelf registration statement registering securities in addition to those
required hereunder, or any Prospectus prepared thereto. The Company shall not file a Registration Statement or any such Prospectus
or any amendments or supplements thereto to which the Holders of a majority of the Registrable Securities not otherwise affiliated
with the Company shall reasonably object in good faith, provided that, the Company is notified of such objection in writing no
later than five Trading Days after the Holders have been so furnished copies of a Registration Statement or one Trading Day after
the Holders have been so furnished copies of any related Prospectus or amendments or supplements thereto. Each Holder agrees to
furnish to the Company a completed questionnaire in the form attached to this Agreement as Annex B (a “Selling
Shareholder Questionnaire”) on a date that is not less than two Trading Days prior to the Filing Date or by the end
of the fourth Trading Day following the date on which such Holder receives draft materials in accordance with this Section.

 

(b)          (i) Prepare and file with the Commission such amendments, including post-effective amendments, to a Registration Statement and
the Prospectus used in connection therewith as may be necessary to keep a Registration Statement continuously effective as to
the applicable Registrable Securities for the Effectiveness Period and prepare and file with the Commission such additional Registration
Statements in order to register for resale under the Securities Act all of the Registrable Securities, (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement (subject to the terms of this Agreement), and,
as so supplemented or amended, to be filed pursuant to Rule 424, (iii) respond as promptly as reasonably possible to any comments
received from the Commission with respect to a Registration Statement or any amendment thereto and provide as promptly as reasonably
possible to the Holders true and complete copies of all correspondence from and to the Commission relating to a Registration Statement
(provided that, the Company shall excise any information contained therein which would constitute material non-public information
regarding the Company or any of its Subsidiaries), and (iv) comply in all material respects with the applicable provisions of
the Securities Act and the Exchange Act with respect to the disposition of all Registrable Securities covered by a Registration
Statement during the applicable period in accordance (subject to the terms of this Agreement) with the intended methods of disposition
by the Holders thereof set forth in such Registration Statement as so amended or in such Prospectus as so supplemented.

 

    	 	5	 

     

    

 

(c)          If during the Effectiveness Period, the number of Registrable Securities at any time exceeds 100% of the number of shares of Common
Stock then registered in a Registration Statement, then the Company shall file as soon as reasonably practicable an additional
Registration Statement covering the resale by the Holders of not less than the number of such Registrable Securities.

 

(d)          Notify the Holders of Registrable Securities to be sold (which notice shall, pursuant to clauses (iii) through (vi) hereof, be
accompanied by an instruction to suspend the use of the Prospectus until the requisite changes have been made) as promptly as
reasonably possible (and, in the case of (i)(A) below, not less than one Trading Day prior to such filing) and (if requested by
any such Person) confirm such notice in writing no later than one Trading Day following the day (i)(A) when a Prospectus or any
Prospectus supplement or post-effective amendment to a Registration Statement is proposed to be filed, (B) when the Commission
notifies the Company whether there will be a “review” of such Registration Statement and whenever the Commission comments
in writing on such Registration Statement, and (C) with respect to a Registration Statement or any post-effective amendment, when
the same has become effective, (ii) of any request by the Commission or any other federal or state governmental authority for
amendments or supplements to a Registration Statement or Prospectus or for additional information, (iii) of the issuance by the
Commission or any other federal or state governmental authority of any stop order suspending the effectiveness of a Registration
Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose, (iv) of the
receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such
purpose, (v) of the occurrence of any event or passage of time that makes the financial statements included in a Registration
Statement ineligible for inclusion therein or any statement made in a Registration Statement or Prospectus or any document incorporated
or deemed to be incorporated therein by reference untrue in any material respect or that requires any revisions to a Registration
Statement, Prospectus or other documents so that, in the case of a Registration Statement or the Prospectus, as the case may be,
it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (vi) of
the occurrence or existence of any pending corporate development with respect to the Company that the Company believes may be
material and that, in the determination of the Company, makes it not in the best interest of the Company to allow continued availability
of a Registration Statement or Prospectus, provided, however, in no event shall any such notice contain any information
which would constitute material, non-public information regarding the Company or any of its Subsidiaries.

 

    	 	6	 

     

    

 

(e)          Use its best efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order stopping or suspending the
effectiveness of a Registration Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any
of the Registrable Securities for sale in any jurisdiction, at the earliest practicable moment.

 

(f)           Furnish to each Holder, without charge, at least one conformed copy of each such Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference to
the extent requested by such Person, and all exhibits to the extent requested by such Person (including those previously furnished
or incorporated by reference) promptly after the filing of such documents with the Commission; provided, that any such item which
is available on the EDGAR system (or successor thereto) need not be furnished in physical form.

 

(g)          Subject to the terms of this Agreement, the Company hereby consents to the use of such Prospectus and each amendment or supplement
thereto by each of the selling Holders in connection with the offering and sale of the Registrable Securities covered by such
Prospectus and any amendment or supplement thereto, except after the giving of any notice pursuant to Section 3(d).

 

(h)          The Company shall cooperate with any broker-dealer through which a Holder proposes to resell its Registrable Securities in effecting
a filing with the FINRA Corporate Financing Department pursuant to FINRA Rule 5110, as requested by any such Holder, and the Company
shall pay the filing fee required by such filing within two Business Days of request therefor.

 

(i)           Prior to any resale of Registrable Securities by a Holder, use its commercially reasonable efforts to register or qualify or cooperate
with the selling Holders in connection with the registration or qualification (or exemption from the Registration or qualification)
of such Registrable Securities for the resale by the Holder under the securities or state securities laws (i.e. Blue Sky laws)
of such jurisdictions within the United States as any Holder reasonably requests in writing, to keep each registration or qualification
(or exemption therefrom) effective during the Effectiveness Period and to do any and all other acts or things reasonably necessary
to enable the disposition in such jurisdictions of the Registrable Securities covered by each Registration Statement; provided,
that, the Company shall not be required to qualify generally to do business in any jurisdiction where it is not then so qualified,
subject the Company to any material tax in any such jurisdiction where it is not then so subject or file a general consent to
service of process in any such jurisdiction.

 

    	 	7	 

     

    

 

(j)           If requested by a Holder, cooperate with such Holder to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be delivered to a transferee pursuant to a Registration Statement, which certificates shall be free,
to the extent permitted by the Purchase Agreement, of all restrictive legends, and to enable such Registrable Securities to be
in such denominations and registered in such names as any such Holder may request.

 

(k)          Upon
the occurrence of any event contemplated by Section 3(d), as promptly as reasonably possible under the circumstances taking into
account the Company’s good faith assessment of any adverse consequences to the Company and its shareholders of the premature
disclosure of such event, prepare a supplement or amendment, including a post-effective amendment, to a Registration Statement
or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, and
file any other required document so that, as thereafter delivered, neither a Registration Statement nor such Prospectus will contain
an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made, not misleading. If
the Company notifies the Holders in accordance with clauses (iii) through (vi) of Section 3(d) above to suspend the use of any
Prospectus until the requisite changes to such Prospectus have been made, then the Holders shall suspend use of such Prospectus.
The Company will use its best efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable. The
Company shall be entitled to exercise its right under this Section 3(k) to suspend the availability of a Registration Statement
and Prospectus for a period not to exceed 60 calendar days (which need not be consecutive days) in any 12-month period.

 

(l)           Comply with all applicable rules and regulations of the Commission.

 

(m)         The Company shall use its commercially reasonable efforts to maintain eligibility for use of Form S-3 (or any successor form thereto)
for the registration of the resale of Registrable Securities, if eligible.

 

(n)          The Company may require each selling Holder to furnish to the Company a certified statement as to the number of shares of Common
Stock beneficially owned by such Holder and, if required by the Commission, the natural persons thereof that have voting and dispositive
control over the shares. During any periods that the Company is unable to meet its obligations hereunder with respect to the registration
of the Registrable Securities solely because any Holder fails to furnish such information within three Trading Days of the Company’s
request, any liquidated damages that are accruing at such time as to such Holder only shall be tolled and any event that may otherwise
occur solely because of such delay shall be suspended as to such Holder only, until such information is delivered to the Company.

 

    	 	8	 

     

    

 

4.           Registration Expenses. All fees and expenses incident to the performance of or compliance with, this Agreement by the
Company shall be borne by the Company whether or not any Registrable Securities are sold pursuant to a Registration Statement.
The fees and expenses referred to in the foregoing sentence shall include, without limitation, (i) all registration and filing
fees (including, without limitation, fees and expenses of the Company’s counsel and independent registered public accountants)
(A) with respect to filings made with the Commission, (B) with respect to filings required to be made with any national securities
exchange on which the Common Stock is then listed for trading, (C) in compliance with applicable state securities or Blue Sky
laws reasonably agreed to by the Company in writing (including, without limitation, fees and disbursements of counsel for the
Company in connection with Blue Sky qualifications or exemptions of the Registrable Securities) and (D) if not previously paid
by the Company in connection with an Issuer Filing, with respect to any filing that may be required to be made by any broker through
which a Holder intends to make sales of Registrable Securities with FINRA pursuant to FINRA Rule 5110, so long as the broker is
receiving no more than a customary brokerage commission in connection with such sale, (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities), (iii) messenger, telephone and delivery expenses, (iv)
fees and disbursements of counsel for the Company, (v) Securities Act liability insurance, if the Company so desires such insurance,
and (vi) fees and expenses of all other Persons retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be responsible for all of its internal expenses incurred in connection
with the consummation of the transactions contemplated by this Agreement (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any securities exchange as required hereunder. In no
event shall the Company be responsible for any broker or similar commissions of any Holder or, except to the extent provided for
in the Transaction Documents, any legal fees or other costs of the Holders.

 

5.           Indemnification.

 

(a)          Indemnification by the Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold
harmless each Holder, the officers, directors, members, partners, agents, brokers (including brokers who offer and sell Registrable
Securities as principal as a result of a pledge or any failure to perform under a margin call of Common Stock), investment advisors
and employees (and any other Persons with a functionally equivalent role of a Person holding such titles, notwithstanding a lack
of such title or any other title) of each of them, each Person who controls any such Holder (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, members, shareholders, partners, agents
and employees (and any other Persons with a functionally equivalent role of a Person holding such titles, notwithstanding a lack
of such title or any other title) of each such controlling Person, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’ fees)
and expenses (collectively, “Losses”), as incurred, arising out of or relating to (1) any untrue or alleged
untrue statement of a material fact contained in a Registration Statement, any Prospectus or any form of prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission
of a material fact required to be stated therein or necessary to make the statements therein (in the case of any Prospectus or
supplement thereto, in light of the circumstances under which they were made) not misleading or (2) any violation or alleged violation
by the Company of the Securities Act, the Exchange Act or any state securities law, or any rule or regulation thereunder, in connection
with the performance of its obligations under this Agreement, except to the extent, but only to the extent, that (i) such untrue
statements or omissions are based solely upon information regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent that such information relates to such Holder or such Holder’s proposed method
of distribution of Registrable Securities and was reviewed and expressly approved in writing by such Holder expressly for use
in a Registration Statement, such Prospectus or in any amendment or supplement thereto (it being understood that the Holder has
approved Annex A hereto for this purpose) or (ii) in the case of an occurrence of an event of the type specified in Section 3(d)(iii)-(vi),
the use by such Holder of an outdated, defective or otherwise unavailable Prospectus after the Company has notified such Holder
in writing that the Prospectus is outdated, defective or otherwise unavailable for use by such Holder and prior to the receipt
by such Holder of the Advice contemplated in Section 6(d), but only if and to the extent that following the receipt of the Advice
the misstatement or omission giving rise to such Loss would have been corrected. The Company shall notify the Holders promptly
of the institution, threat or assertion of any Proceeding arising from or in connection with the transactions contemplated by
this Agreement of which the Company is aware. Such indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such indemnified person and shall survive the transfer of any Registrable Securities by any of the Holders
in accordance with Section 6(h).

 

    	 	9	 

     

    

 

(b)          Indemnification by Holders. Each Holder shall, severally and not jointly, indemnify and hold harmless the Company, its
directors, officers, agents and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses, as incurred, to the extent arising out of or based solely
upon: (x) such Holder’s failure to comply with any applicable prospectus delivery requirements of the Securities Act through
no fault of the Company or (y) any untrue or alleged untrue statement of a material fact contained in any Registration Statement,
any Prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in
the case of any Prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading (i)
to the extent, but only to the extent, that such untrue statement or omission is contained in any information so furnished in
writing by such Holder to the Company expressly for inclusion in such Registration Statement or such Prospectus or (ii) to the
extent, but only to the extent, that such information relates to such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder expressly for use in a Registration Statement (it
being understood that the Holder has approved Annex A hereto for this purpose), such Prospectus or in any amendment or supplement
thereto or (iii) in the case of an occurrence of an event of the type specified in Section 3(d)(iii)-(vi), to the extent, but
only to the extent, related to the use by such Holder of an outdated, defective or otherwise unavailable Prospectus after the
Company has notified such Holder in writing that the Prospectus is outdated, defective or otherwise unavailable for use by such
Holder and prior to the receipt by such Holder of the Advice contemplated in Section 6(d), but only if and to the extent that
following the receipt of the Advice the misstatement or omission giving rise to such Loss would have been corrected. In no event
shall the liability of any selling Holder under this Section 5(b) be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities giving rise to such indemnification obligation.

 

    	 	10	 

     

    

 

(c)           Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity
hereunder (an “Indemnified Party”), such Indemnified Party shall promptly notify the Person from whom indemnity
is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall have the right to assume
the defense thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with defense thereof; provided, that, the failure of any Indemnified Party to give such
notice shall not relieve the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and only)
to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to
appeal or further review) that such failure shall have materially and adversely prejudiced the Indemnifying Party.

 

An
Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof,
but the fees and expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying
Party has agreed in writing to pay such fees and expenses, (2) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding, or
(3) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and counsel to the Indemnified Party shall reasonably believe that a material conflict of interest is likely to exist if
the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which case, if such Indemnified Party
notifies the Indemnifying Party in writing that it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense thereof and the reasonable fees and expenses of no more
than one separate counsel shall be at the expense of the Indemnifying Party). The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably withheld or delayed.
No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter of such Proceeding.

 

    	 	11	 

     

    

 

Subject
to the terms of this Agreement, all reasonable fees and expenses of the Indemnified Party (including reasonable fees and expenses
to the extent incurred in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with
this Section) shall be paid to the Indemnified Party, as incurred, within ten Trading Days of written notice thereof to the Indemnifying
Party; provided, that, the Indemnified Party shall promptly reimburse the Indemnifying Party for that portion of such fees and
expenses applicable to such actions for which such Indemnified Party is finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) not to be entitled to indemnification hereunder.

 

(d)          Contribution. If the indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party or insufficient
to hold an Indemnified Party harmless for any Losses, then each Indemnifying Party shall contribute to the amount paid or payable
by such Indemnified Party, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified
Party in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable
considerations. The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among
other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such Indemnifying Party
or Indemnified Party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such action, statement or omission. The amount paid or payable by a party as a result of any Losses shall be deemed to include,
subject to the limitations set forth in this Agreement, any reasonable attorneys’ or other fees or expenses incurred by
such party in connection with any Proceeding to the extent such party would have been indemnified for such fees or expenses if
the indemnification provided for in this Section was available to such party in accordance with its terms.

 

The
parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by
pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred
to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 5(d), no Holder shall be required to
contribute pursuant to this Section 5(d), in the aggregate, any amount in excess of the amount by which the net proceeds actually
received by such Holder from the sale of the Registrable Securities subject to the Proceeding exceeds the amount of any damages
that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission.

 

The
indemnity and contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties
may have to the Indemnified Parties.

 

    	 	12	 

     

    

 

6.           Miscellaneous.

 

(a)          Remedies. In the event of a breach by the Company or by a Holder of any of their respective obligations under this Agreement,
each Holder or the Company, as the case may be, in addition to being entitled to exercise all rights granted by law and under
this Agreement, including recovery of damages, shall be entitled to specific performance of its rights under this Agreement. Each
of the Company and each Holder agrees that monetary damages would not provide adequate compensation for any losses incurred by
reason of a breach by it of any of the provisions of this Agreement and hereby further agrees that, in the event of any action
for specific performance in respect of such breach, it shall not assert or shall waive the defense that a remedy at law would
be adequate.

 

(b)          Compliance. Each Holder covenants and agrees that it will comply with the prospectus delivery requirements of the Securities
Act as applicable to it (unless an exemption therefrom is available) in connection with sales of Registrable Securities pursuant
to a Registration Statement.

 

(c)          Discontinued Disposition. By its acquisition of Registrable Securities, each Holder agrees that, upon receipt of a notice
from the Company of the occurrence of any event of the kind described in Section 3(d)(iii) through (vi), such Holder will forthwith
discontinue disposition of such Registrable Securities under a Registration Statement until it is advised in writing (“Advice”)
by the Company that the use of the applicable Prospectus (as it may have been supplemented or amended) may be resumed. The Company
will use its best efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable.

 

(d)          Piggy-Back Registrations. If, at any time during the Effectiveness Period, there is not an effective Registration Statement
covering all of the Registrable Securities and the Company shall determine to prepare and file with the Commission a registration
statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection
with the Company’s stock option or other employee benefit plans, then the Company shall deliver to each Holder a written
notice of such determination and, if within fifteen days after the date of the delivery of such notice, any such Holder shall
so request in writing, the Company shall include in such registration statement all or any part of such Registrable Securities
such Holder requests to be registered; provided, however, that the Company shall not be required to register any
Registrable Securities pursuant to this Section 6(e) that are eligible for resale pursuant to Rule 144 (without volume restrictions
or current public information requirements) promulgated by the Commission pursuant to the Securities Act or that are the subject
of a then effective Registration Statement.

 

    	 	13	 

     

    

 

(e)          Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the same shall
be in writing and signed by the Company and the Holders of at least a majority of the then outstanding Registrable Securities
not held by persons otherwise affiliated with the Company (for purposes of clarification, this includes any Registrable Securities
issuable upon exercise or conversion of any Security, but shall be understood to exclude all Registrable Securities, if any, held
by affiliates of the Company). If a Registration Statement does not register all of the Registrable Securities pursuant to a waiver
or amendment done in compliance with the previous sentence, then the number of Registrable Securities to be registered for each
Holder shall be reduced pro rata among all Holders and each Holder shall have the right to designate which of its Registrable
Securities shall be omitted from such Registration Statement. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the rights of a Holder or some Holders and that does
not directly or indirectly affect the rights of other Holders may be given only by such Holder or Holders of all of the Registrable
Securities to which such waiver or consent relates; provided, however, that the provisions of this sentence may
not be amended, modified, or supplemented except in accordance with the provisions of the first sentence of this Section 6(f).
No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of this
Agreement unless the same consideration also is offered to all of the parties to this Agreement.

 

(f)           Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be delivered as set forth in the Purchase Agreement.

 

(g)          Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns
of each of the parties and shall inure to the benefit of each Holder. The Company may not assign (except by merger) its rights
or obligations hereunder without the prior written consent of all of the Holders of the then outstanding Registrable Securities.
Each Holder may assign their respective rights hereunder in the manner and to the Persons as permitted under Section 5.7 of the
Purchase Agreement.

 

(h)          Execution and Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together
shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature
shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same
force and effect as if such facsimile or “.pdf” signature page were an original thereof.

 

(i)           Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall
be determined in accordance with the provisions of the Purchase Agreement.

 

(j)           Cumulative Remedies. The remedies provided herein are cumulative and not exclusive of any other remedies provided by law.

 

(k)          Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention
of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any
of such that may be hereafter declared invalid, illegal, void or unenforceable.

 

    	 	14	 

     

    

 

(l)           Headings. The headings in this Agreement are for convenience only, do not constitute a part of the Agreement and shall
not be deemed to limit or affect any of the provisions hereof.

 

(m)         Independent Nature of Holders’ Obligations and Rights. The obligations of each Holder hereunder are several and not
joint with the obligations of any other Holder hereunder, and no Holder shall be responsible in any way for the performance of
the obligations of any other Holder hereunder. Nothing contained herein or in any other agreement or document delivered at any
closing, and no action taken by any Holder pursuant hereto or thereto, shall be deemed to constitute the Holders as a partnership,
an association, a joint venture or any other kind of group or entity, or create a presumption that the Holders are in any way
acting in concert or as a group or entity with respect to such obligations or the transactions contemplated by this Agreement
or any other matters, and the Company acknowledges that the Holders are not acting in concert or as a group, and the Company shall
not asset any such claim, with respect to such obligations or transactions. Each Holder shall be entitled to protect and enforce
its rights, including without limitation the rights arising out of this Agreement, and it shall not be necessary for any other
Holder to be joined as an additional party in any proceeding for such purpose. The use of a single agreement with respect to the
obligations of the Company contained was solely in the control of the Company, not the action or decision of any Holder, and was
done solely for the convenience of the Company and not because it was required or requested to do so by any Holder. It is expressly
understood and agreed that each provision contained in this Agreement is between the Company and a Holder, solely, and not between
the Company and the Holders collectively and not between and among Holders.

 

********************

 

(Signature
Pages Follow)

 

    	 	15	 

     

    

 

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

 

	 	CREATIVE REALTIES, inc.  
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

[SIGNATURE
PAGE OF HOLDERS FOLLOWS]

 

     

     

    

 

[SIGNATURE
PAGE OF HOLDERS OF 

SECURED
CONVERTIBLE PROMISSORY NOTES]

 

Name
of Holder: __________________________

 

Signature
of Authorized Signatory of Holder: __________________________

 

Name
of Authorized Signatory: _________________________

 

Title
of Authorized Signatory: __________________________

  

[SIGNATURE
PAGES CONTINUE]

 

     

     

    

 

Annex
A

 

Plan
of Distribution

 

Each
Selling Shareholder (the “Selling Shareholders”) of the securities and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their securities covered hereby on the OTC Bulletin Board or
any other stock exchange, market or trading facility on which the securities are traded or in private transactions. These sales
may be at fixed or negotiated prices. A Selling Shareholder may use any one or more of the following methods when selling securities:

 

		●	ordinary
                                         brokerage transactions and transactions in which the broker-dealer solicits purchasers;

 

		●	block
                                         trades in which the broker-dealer will attempt to sell the securities as agent but may
                                         position and resell a portion of the block as principal to facilitate the transaction;

 

		●	purchases
                                         by a broker-dealer as principal and resale by the broker-dealer for its account;

 

		●	an
                                         exchange distribution in accordance with the rules of the applicable exchange;

 

		●	privately
                                         negotiated transactions;

 

		●	in
                                         transactions through broker-dealers that agree with the Selling Shareholders to sell
                                         a specified number of such securities at a stipulated price per security;

 

		●	through
                                         the writing or settlement of options or other hedging transactions, whether through an
                                         options exchange or otherwise;

 

		●	a
                                         combination of any such methods of sale; or

 

		●	any
                                         other method permitted pursuant to applicable law.

 

The
Selling Shareholders may also sell securities under Rule 144 under the Securities Act of 1933, as amended (the “Securities
Act”), if available, rather than under this prospectus.

 

Broker-dealers
engaged by the Selling Shareholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Shareholders (or, if any broker-dealer acts as agent for the purchaser of securities,
from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an
agency transaction not in excess of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a
principal transaction a markup or markdown in compliance with FINRA IM-2440.

 

     

     

    

 

In
connection with the sale of the securities or interests therein, the Selling Shareholders may enter into hedging transactions
with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of
hedging the positions they assume. The Selling Shareholders may also sell securities short and deliver these securities to close
out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities. The Selling
Shareholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one
or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered
by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus
(as supplemented or amended to reflect such transaction).

 

The
Selling Shareholders holders and any broker-dealers or agents that are involved in selling the securities may be deemed to be
“underwriters” within the meaning of the Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act. Each Selling Shareholders has informed the Company that it does
not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the securities.

 

The
Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities. The
Company has agreed to indemnify the Selling Shareholders against certain losses, claims, damages and liabilities, including liabilities
under the Securities Act.

 

Because
Selling Shareholders may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject
to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder. In addition, any securities covered
by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than
under this prospectus. The Selling Shareholders have advised us that there is no underwriter or coordinating broker acting in
connection with the proposed sale of the resale securities by the Selling Shareholders.

 

We
agreed to keep this prospectus effective until the earlier of (i) all securities covered by this prospectus have been sold, thereunder
or pursuant to Rule 144, or (ii) all securities covered by this prospectus may be sold without volume or manner-of-sale restrictions
pursuant to Rule 144 and without the requirement for the Company to be in compliance with the current public information requirement
under Rule 144, as determined by the counsel to the Company pursuant to a written opinion letter to such effect. The resale securities
will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition,
in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale
in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

 

Under
applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not
simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined
in Regulation M, prior to the commencement of the distribution. In addition, the Selling Shareholders will be subject to applicable
provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of
purchases and sales of securities of the common stock by the Selling Shareholders or any other person. We will make copies of
this prospectus available to the Selling Shareholders and have informed them of the need to deliver a copy of this prospectus
to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

 

    	 	2	 

     

    

 

Annex
B

 

CREATIVE
REALITIES, inc.

 

Selling
Shareholder Notice and Questionnaire

 

The
undersigned beneficial owner of common shares issuable upon conversion of Secured Convertible Promissory Notes and common shares
issuable upon the exercise of related warrants issued simultaneously with the Secured Convertible Promissory Notes (the “Registrable
Securities”) of Creative Realities, Inc., a Minnesota corporation (the “Company”), understands that
the Company has filed or intends to file with the Securities and Exchange Commission (the “Commission”) a registration
statement (the “Registration Statement”) for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the “Securities Act”), of the Registrable Securities, in accordance with the terms of
the Registration Rights Agreement (the “Registration Rights Agreement”) to which this document is annexed.
A copy of the Registration Rights Agreement is available from the Company upon request at the address set forth below. All capitalized
terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights Agreement.

 

Certain
legal consequences arise from being named as a selling shareholder in the Registration Statement and the related prospectus. Accordingly,
holders and beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the
consequences of being named or not being named as a selling shareholder in the Registration Statement and the related prospectus.

 

NOTICE

 

The
undersigned beneficial owner (the “Selling Shareholder”) of Registrable Securities hereby elects to include
the Registrable Securities owned by it in the Registration Statement.

 

     

     

    

 

The
undersigned hereby provides the following information to the Company and represents and warrants that such information is accurate:

 

QUESTIONNAIRE

 

	1.	Name.

 

	 	(a)	Full Legal Name of Selling Shareholder

 

	 	 
	 	 

 

	 	(b)	Full Legal Name of Registered Holder (if not the same
as (a) above) through which Registrable Securities are held:

 

	 	 
	 	 

 

	 	(c)	Full Legal Name of Natural Control Person (which means
a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by this
Questionnaire):

 

	 	 
	 	 

 

	2.	Address for Notices to Selling Shareholder:

 

	 
	 
	 

	Telephone:	 

	Fax:	 

	Contact Person:	 

 

	3.	Broker-Dealer Status:

 

	 	(a)	Are you a broker-dealer?

 

Yes
☐                No ☐

 

	 	(b)	If “yes” to Section 3(a), did you receive
your Registrable Securities as compensation for investment banking services to the Company?

 

Yes
☐                No ☐

 

	 	Note:	If “no” to Section 3(b), the Commission’s
staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

    	 	2	 

     

    

 

	 	(c)	Are you an affiliate of a broker-dealer?

 

Yes
☐                No ☐

 

	 	(d)	If you are an affiliate of a broker-dealer, do you certify
that you purchased the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable
Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable
Securities?

 

Yes
☐                No ☐

 

	 	Note:	If “no” to Section 3(d), the Commission’s
staff has indicated that you should be identified as an underwriter in the Registration Statement.

 

	4.	Beneficial Ownership of Securities of the Company
Owned by the Selling Shareholder.

 

Except
as set forth below in this Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company
other than the securities issuable pursuant to the Purchase Agreement.

 

	 	(a)	Type and Amount of other securities beneficially owned
by the Selling Shareholders:

 

	 	 
	 	 

 

	5.	Relationships with the Company:

 

Except
as set forth below, neither the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners
of 5% of more of the equity securities of the undersigned) has held any position or office or has had any other material relationship
with the Company (or its predecessors or affiliates) during the past three years.

 

		State
                                         any exceptions here:

 

	 	 
	 	 

 

The
undersigned agrees to promptly notify the Company of any inaccuracies or changes in the information provided herein that may occur
subsequent to the date hereof at any time while the Registration Statement remains effective.

 

By
signing below, the undersigned consents to the disclosure of the information contained herein in its answers to Items 1 through
5 and the inclusion of such information in the Registration Statement and the related prospectus and any amendments or supplements
thereto. The undersigned understands that such information will be relied upon by the Company in connection with the preparation
or amendment of the Registration Statement and the related prospectus and any amendments or supplements thereto.

 

    	 	3	 

     

    

 

IN
WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered
either in person or by its duly authorized agent.

 

	Date: 	 	 	Beneficial Owner:	 

 

	 	By:	 
	 	 	Name:
	 	 	Title:

 

PLEASE
FAX A COPY (OR EMAIL A .PDF COPY) OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN THE ORIGINAL BY OVERNIGHT
MAIL, TO:

 

c/o
Creative Realities, Inc. 

22
Audrey Place 

Fairfield
NJ 07004

 

Email:
alevy@cri.com and jwalpuck@cri.com

 

 

 4EXHIBIT 10.1

 

EXECUTIVE SEVERANCE AGREEMENT

 

THIS EXECUTIVE SEVERANCE AGREEMENT ("Agreement")
made and entered into on the 11th day of February, 2016, by and between Simmons First National Corporation (the "Company"),
an Arkansas corporation, and George Makris, Jr ("Executive").

 

R E C I T A L S:

 

The Company acknowledges that the Executive is to
significantly contribute to the growth and success of the Company. As a publicly held corporation, a Change in Control of the Company
may occur with or without the approval of the Board of Directors of the Company ("Board"). The Board also recognizes
that the possibility of such a Change in Control may contribute to uncertainty on the part of senior management resulting in distraction
from their operating responsibilities or in the departure of senior management.

 

The Board believes that outstanding management is
critical to advancing the best interests of the Company and its shareholders. It is essential that the management of the Company's
business be continued with a minimum of disruption during any proposed bid to acquire the Company or to engage in a business combination
with the Company. The Company believes that the objective of securing and retaining outstanding management will be achieved if
certain of the Company's senior management employees are given assurances of employment security so they will not be distracted
by personal uncertainties and risks created by such circumstances.

 

NOW, THEREFORE, in consideration of the mutual covenants
and obligations herein and the compensation the Company agrees herein to pay the Executive, and of other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Company and the Executive agree as follows:

 

ARTICLE 1

TERM OF AGREEMENT

 

1.1 Term. This Agreement shall become effective
as of the date on which it is executed by the Company ("Effective Date"). The Agreement shall be effective for
thirty-six months (36) and will automatically be extended for twelve (12) months as of each anniversary date of the Effective Date
("Agreement Term") unless the Agreement Term is terminated by the Company upon written notification to the Executive,
within thirty (30) days before an anniversary date of the Effective Date, that the Agreement will terminate as of last day of the
Agreement Term as in effect immediately prior to such anniversary date.

 

Unless the Company has effectively terminated this
Agreement as prescribed above in this Section 1.1, in the event of a Change in Control, the Agreement Term shall be amended to
twenty-four (24) months commencing upon the Change in Control Date and shall then expire at the end of such twenty-four (24) month
period.

 

 

     

     

    

1.2 Change in Control. Change in Control
shall mean a change in ownership or control of the Company as defined in Treasury Regulation Section 1.409A-3(i)(5) or any subsequently
applicable Treasury Regulation.

 

1.3 Control Change Date. Control Change Date
means the date on which an event described in Section 1.2 occurs. If a Change in Control occurs on account of a series of transactions,
the Control Change Date is the date of the last of such transactions.

 

ARTICLE 2

TERMINATION OF EMPLOYMENT

 

2.1 General. Executive shall be entitled
to receive Termination Compensation, as defined in Section 2.5, according to this Article if:

 

(a) the Executive's employment is involuntarily
terminated as specified in Section 2.2, or

 

(b) the Executive voluntarily terminates employment
as specified in Section 2.3.

 

2.2 Termination by the Company. (a) Executive
shall be entitled to receive Termination Compensation (as described in Section 2.5) if during an Agreement Term, Executive's employment
is terminated by the Company without Cause on or after a Control Change Date.

 

(b) Executive shall be entitled to receive Termination
Compensation (as described in Section 2.5) if during an Agreement Term, Executive's employment is terminated by the Company without
Cause within the 180 days immediately preceding a Control Change Date.

 

(c) Cause, means, for purposes of this Agreement,
(i) willful and continued failure by the Executive to perform his duties as established by the Board of Directors of the Company;
(ii) a material breach by the Executive of his fiduciary duties of loyalty or care to the Company; (iii) conviction of a felony;
or (iv) willful, flagrant, deliberate and repeated infractions of material published policies and procedures of the Company of
which the Executive has actual knowledge ("Cause Exception"). If the Company desires to discharge the Executive
under the Cause Exception, it shall give notice to the Executive as provided in Section 2.7 and the Executive shall have thirty
(30) days after notice has been given to him in which to cure the reason for the Company's exercise of the Cause Exception. If
the reason for the Company's exercise of the Cause Exception is timely cured by the Executive (as determined by a committee appointed
by the Board of Directors), the Company's notice shall become null and void.

 

2.3 Voluntary Termination.  Executive shall
be entitled to receive Termination Compensation (as defined in Section 2.5) if a Change in Control occurs during an Agreement Term,
and the Executive voluntarily terminates employment during an Agreement Term and within six (6) months following the occurrence
of a Trigger Event.

 

    	2

     

    

2.4 Trigger Event. A Trigger Event means,
for purposes of this Agreement, the occurrence of any one of the following events:

 

		(a)	the failure by the Board to reelect or appoint the Executive to a position with duties, functions
and responsibilities substantially equivalent to the position held by the Executive on the Control Change Date;

 

		(b)	a material modification by the Board of the duties, functions responsibilities of the Executive
without his consent;

 

		(c)	the failure of the Company to permit the Executive to exercise such responsibilities as are consistent
with the Executive's position and are of such a nature as are usually associated with such office of a corporation engaged in substantially
the same business as the Company;

 

		(d)	the Company requires the Executive to relocate his employment more than fifty (50) miles from his
place of employment, without the consent of the Executive, excluding reasonably required business travel or temporary assignments
for a reasonable period of time;

 

		(e)	a reduction in Executive's compensation or benefits; or

 

		(f)	the Company shall fail to make a payment when due to the Executive.

 

2.5 Termination Compensation. Termination
Compensation equal to three times Executive's Base Period Income shall be paid in a single sum payment in cash. If at the time
of the Executive's termination of employment the Executive is not a Specified Employee, then payment of the Termination Compensation
to Executive shall be made on the later of the thirtieth (30th) business day after Executive's employment termination
or the first day of the month following Executive's employment termination. If at the time of the Executive's termination of employment
the Executive is a Specified Employee, then payment of the Termination Compensation to Executive shall be made on the first day
of the seventh (7th) month following the Executive's employment termination.

 

2.6 Base Period Income. Executive's Base
Period Income equals the sum of (i) his annual base salary as of Executive's termination date, and (ii) the greater of the average
of any cash incentive bonus payable to Executive for the Company's last two completed fiscal years or the Executive's target bonus
opportunity for the then current year under the Company's annual incentive plan.

 

2.7 Notice of Termination. Any termination
by the Company under the Cause Exception or by the Executive after a Trigger Event shall be communicated by Notice of Termination
to the other party hereto. A "Notice of Termination" shall be a written notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive's employment under the provision so indicated and (iii) if the termination date
is other than the date of receipt of such notice, specifies the effective date of termination.

 

    	3

     

    

2.8Specified Employee.  Specified
Employee is a key employee (as defined in section 416(i) of the Internal Revenue Code without regard to section 416(i)(5)) of
the Employer (and all persons with whom the Employer would be considered a single employer under section 414(b) or 414(c) of the
Internal Revenue Code) any stock of which is publicly traded on an established securities market or otherwise. For this purpose,
an employee is a key employee if he or she meets the requirements of section 416(i) at any time during the calendar year. If a
person is a key employee as of December 31 of any year, the person is treated as a specified employee for the 12-month period
beginning on the first day of April of the next calendar year. The determination as to whether the stock is publicly traded on
an established securities market or otherwise must be determined as of the date of the Employee's termination of employment.

 

ARTICLE 3

ATTORNEY'S FEES

 

In the event that the Executive incurs any attorney's
fees in protecting or enforcing his rights under this Agreement, the Company shall reimburse the Executive for such reasonable
attorneys' fees and for any other reasonable expenses related thereto. Such reimbursement shall be made within thirty (30) days
following final resolution of the dispute or occurrence giving rise to such fees and expenses.

 

ARTICLE 4

CONTINUATION OF COVERAGE OF INSURANCE PLANS

 

At the termination of any period of coverage provided
above, the Executive shall have the option to have assigned to him, at no cost and no apportionment of prepaid premiums, any assignable
insurance owned by the Company and relating specifically to the Executive. Notwithstanding the foregoing or the provisions of Section
4.2 below, the Company shall not be obligated to continue the Executive's participation in the Simmons First Endorsement Split-Dollar
Life Insurance Program or provide any alternative benefits to such program after termination of the Executive's employment, except
as specifically provided pursuant to the terms of the program documents governing such program.

 

 

ARTICLE 5

MITIGATION OF PAYMENT

 

The Company and the Executive agree that, following
the termination of employment by the Executive with Company, the Executive has no obligation to take any steps whatsoever to secure
other employment and such failure by the Executive to search for or to find other employment upon termination from Company shall
in no way impact the Executive's right to receive payment under any of the provisions of this Agreement.

 

    	4

     

    

ARTICLE 6

DECISIONS BY COMPANY; FACILITY OF PAYMENT

 

Any powers granted to the Board hereunder may be
exercised by a committee, appointed by the Board, and such committee, if appointed, shall have general responsibility for the administration
and interpretation of this Agreement. If the Board or the committee shall find that any person to whom any amount is or was payable
hereunder is unable to care for his affairs because of illness or accident, or has died, then the Board or the committee, if it
so elects, may direct that any payment due him or his estate (unless a prior claim therefore has been made by a duly appointed
legal representative) or any part thereof be paid or applied for the benefit of such person or to or for the benefit of his spouse,
children or other dependents, an institution maintaining or having custody of such person, any other person deemed by the Board
or committee to be a proper recipient on behalf of such person otherwise entitled to payment, or any of them, in such manner and
proportion as the Board or committee may deem proper. Any such payment shall be in complete discharge of the liability of the Company
therefor.

 

ARTICLE 7

INDEMNIFICATION

 

The Company shall indemnify the Executive during
his employment and thereafter to the maximum extent permitted by applicable law for any and all liability of the Executive arising
out of, or in connection with, his employment by the Company or membership on the Board; provided, that in no event shall such
indemnity of the Executive at any time during the period of his employment by the Company be less than the maximum indemnity provided
by the Company at any time during such period to any other officer or director under an indemnification insurance policy or the
bylaws or charter of the Company or by agreement.

 

ARTICLE 8

SOURCE OF PAYMENTS; NO TRUST

 

The obligations of the Company to make payments
hereunder shall constitute an unsecured liability of the Company to the Executive. Such payments shall be from the general funds
of the Company, and the Company shall not be required to establish or maintain any special or separate fund, or otherwise to segregate
assets to assure that such payments shall be made, and neither the Executive nor his designated beneficiary shall have any interest
in any particular asset of the Company by reason of its obligations hereunder. Nothing contained in this Agreement shall create
or be construed as creating a trust of any kind or any other fiduciary relationship between the Company and the Executive or any
other person. To the extent that any person acquires a right to receive payments from the Company hereunder, such right shall be
no greater than the right of an unsecured creditor of the Company.

 

 

    	5

     

    

ARTICLE 9

REDUCTION IN BENEFITS, EXCISE TAX

 

In the event that the severance and other benefits
provided for in this Agreement or otherwise payable to Executive (i) constitute "parachute payments" within the
meaning of Section 280G of the Code and (ii) but for this Article 9, would be subject to the excise tax imposed by Section 4999
of the Code, then Executive's payments and benefits will be either:

(a)     delivered
in full, or

(b)     delivered
as to such lesser extent which would result in no portion of such severance benefits being subject to excise tax under Section 4999
of the Code, whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the
excise tax imposed by Section 4999, results in the receipt by Executive on an after-tax basis, of the greatest amount of severance
benefits, notwithstanding that all or some portion of such severance benefits may be taxable under Section 4999 of the Code.

If a reduction in severance and other
payments and benefits constituting "parachute payments" is necessary so that benefits are delivered to a lesser extent,
reduction will occur in the following order: (i) reduction of cash payments; (ii) cancellation of awards granted "contingent
on a change in ownership or control" (within the meaning of Code Section 280G), (iii) cancellation of accelerated
vesting of equity awards, and (iv) reduction of employee benefits. In the event that acceleration of vesting of equity award
compensation is to be reduced, such acceleration of vesting will be cancelled in the reverse order of the date of grant of Executive's
equity awards.

Any determination required under this
Article 9 will be made in writing by the Company's independent tax accountants engaged by the Company for general tax purposes
immediately prior to the Change in Control (the "Accountants"), whose good faith determination will be
conclusive and binding upon Executive and the Company for all purposes. If the tax accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or group effecting the Change in Control, or if such firm otherwise
cannot perform the calculations, the Company shall appoint a nationally recognized independent registered public accounting firm
to make the determinations required hereunder. For purposes of making the calculations, the Accountants may make reasonable assumptions
and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application
of Sections 280G and 4999 of the Code. The Company and Executive will furnish to the Accountants such information and documents
as the Accountants may reasonably request in order to make a determination under this Section. The Company will bear all costs
the Accountants may reasonably incur in connection with any calculations contemplated by this Article 9.

 

ARTICLE 10

SEVERABILITY

 

All agreements and covenants contained herein are
severable, and in the event any of them shall be held to be invalid by any competent court, this Agreement shall be interpreted
as if such invalid agreements or covenants were not contained herein.

 

 

    	6

     

    

ARTICLE 11

ASSIGNMENT PROHIBITED

 

This Agreement is personal to each of the parties
hereto, and neither party may assign nor delegate any of his or its rights or obligations hereunder except as specified in Article
16. Any attempt to assign any rights or delegate any obligations under this Agreement shall be void.

 

ARTICLE 12

NO ATTACHMENT

 

Except as otherwise provided in this Agreement or
required by applicable law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge or hypothecation or to execution, attachment, levy, or similar process or assignment
by operation of law and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

 

ARTICLE 13

HEADINGS

 

The headings of articles, paragraphs and sections
herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions
of this Agreement.

 

ARTICLE 14

GOVERNING LAW

 

The parties intend that this Agreement and the performance
hereunder and all suits and special proceedings hereunder shall be construed in accordance with and under and pursuant to the laws
of the State of Arkansas, and that in any action, special proceeding or other proceeding that may be brought arising out of, in
connection with, or by reason of this Agreement, the laws of the State of Arkansas, shall be applicable and shall govern to the
exclusion of the law of any other forum, without regard to the jurisdiction in which any action or special proceeding may be instituted.

 

ARTICLE 15

BINDING EFFECT

 

This Agreement shall be binding upon, and inure
to the benefit of, the Executive and his heirs, executors, administrators and legal representatives and the Company and its permitted
successors and assigns.

 

ARTICLE 16

MERGER OR CONSOLIDATION

 

The Company will not consolidate or merge into or
with another corporation, or transfer all or substantially all of its assets to another corporation (the "Successor Corporation")
unless the Successor Corporation shall assume this Agreement, and upon such assumption, the Executive and the Successor Corporation
shall become obligated to perform the terms and conditions of this Agreement.

 

    	7

     

    

ARTICLE 17

ENTIRE AGREEMENT

 

This Agreement expresses the whole and entire agreement
between the parties with reference to Executive’s severance and, as of the effective date hereof, supersedes and replaces
any prior employment agreement, understanding or arrangement (whether written or oral) between the Company and the Executive on
this subject. Each of the parties hereto has relied on his or its own judgment in entering into this Agreement.

 

ARTICLE 18

NOTICES

 

All notices, requests and other communications to
any party under this Agreement shall be in writing and shall be given to such party at its address set forth below or such other
address as such party may hereafter specify for the purpose by notice to the other party:

 

	 	(a) If to the Executive:   	George A. Makris, Jr.
	 	 	900 W. 46th, Unit 7
	 	 	Pine Bluff, AR 71603
	 	 	 
	 	 	 
	 	(b) If to the Company:	Simmons First National
Corporation
	 	 	Attention: Chairman
	 	 	501 Main Street
	 	 	P. O. Box 7009
	 	 	Pine Bluff, Arkansas 71611

 

Each such notice, request or other communication
shall be effective (i) if given by mail, 72 hours after such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (ii) if given by any other means, when delivered at the address specified in this Article 18.

 

ARTICLE 19

MODIFICATION OF AGREEMENT

 

No waiver or modification of this Agreement or of
any covenant, condition, or limitation herein contained shall be valid unless in writing and duly executed by the party to be charged
therewith. No evidence of any waiver of modification shall be offered or received in evidence at any proceeding, arbitration, or
litigation between the parties hereto arising out of or affecting this Agreement, or the rights or obligations of the parties hereunder,
unless such waiver or modification is in writing, duly executed as aforesaid. The parties further agree that the provisions of
this Article 19 may not be waived except as herein set forth.

 

    	8

     

    

ARTICLE 20

TAXES

 

To the extent required by applicable law, the Company
shall deduct and withhold all necessary Social Security taxes and all necessary federal and state withholding taxes and any other
similar sums required by laws to be withheld from any payments made pursuant to the terms of this Agreement. This term shall be
construed in conjunction with Article 9 and shall not supersede or modify it in any way.

 

ARTICLE 21

RECITALS

 

The Recitals to this Agreement are incorporated
herein and shall constitute an integral part of this Agreement

 

IN WITNESS WHEREOF, the parties have executed this
Agreement on the day and year first above written.

 

 

		EXECUTIVE:	/s/ George A. Makris, Jr.
	 	 	George Makris, Jr.
	 	 	 
	 	COMPANY:	SIMMONS FIRST NATIONAL CORPORATION
	 	 	 	 
	 	 	By:	/s/ Marty Casteel
	 	 	Title:	Senior Executive Vice President

 

 

 

 

 

 

 

9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00254-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00254-of-00352.parquet"}]]