Document:

exhibit10-11.htm

    FORM OF WARRANT AGREEMENT 

     

              WARRANT AGREEMENT (this “Agreement”) dated as of ___________, 2010 between
Vishay Precision Group, Inc., a Delaware corporation (the “Company”), and American Stock Transfer & Trust
Co., a New York corporation, as warrant agent (the “Warrant Agent”). 

     

              WHEREAS, Vishay Intertechnology, Inc, a
Delaware corporation (“Vishay Intertechnology”), and American Stock Transfer & Trust
Co. entered into that certain Warrant Agreement, dated as of December 13, 2002
(the “Vishay Intertechnology Warrant
Agreement”);
and

     

              WHEREAS, pursuant to the Vishay
Intertechnology Warrant Agreement, Vishay Intertechnology agreed that, in case
it shall at any time pay a dividend or make a distribution to all holders of its
common stock consisting of the capital stock of any class or series, or similar
interests, of or relating to a subsidiary or other business entity of Vishay
Intertechnology, then each holder of a class A warrant and each holder of a
class B warrant issued pursuant to the Vishay Intertechnology Warrant Agreement
shall be entitled to a warrant evidencing a right to purchase shares of capital
stock of the subsidiary or other business entity whose capital stock was paid as
a dividend or distributed by Vishay Intertechnology, with such terms as are
specified in the Vishay Intertechnology Warrant Agreement; and

     

              WHEREAS, Vishay Intertechnology and the
Company entered into that certain Master Separation Agreement, dated as of
_______, 2010 (the “Master Separation Agreement”), providing for the spin-off of the Company
by Vishay Intertechnology in the form of a tax free dividend of the common stock
of the Company to the holders of the common stock of Vishay Intertechnology and
the class B common stock of the Company to the holders of class B common stock
of Vishay Intertechnology; and

     

              WHEREAS, the Company has agreed under the
terms of the Master Separation Agreement to comply with the obligation under the
Vishay Intertechnology Warrant Agreement to issue the Company’s warrants to the
holders of the Vishay Intertechnology class A warrants and the class B warrants;
and

     

              WHEREAS, in furtherance of its obligations
under the Vishay Intertechnology Warrant Agreement and the Master Separation
Agreement, the Company desires to enter into this Warrant Agreement and to issue
(i) to the holders of the Vishay Intertechnology class A warrants, the Company’s
warrants to purchase up to an aggregate of _____________ shares of the Company’s
common stock, par value $0.__ per share, as evidenced by warrant certificates in
the form attached hereto as Exhibit A (the “Class A Warrants”) at the Class A Exercise Price and (ii) to
the holders of the Vishay Intertechnology class B warrants, the Company’s
warrants to purchase up to ________ shares of the Company’s common stock, par
value $0.__ per share, as evidenced by warrant certificates in the form attached
hereto as Exhibit B (the “Class B Warrants”) at the Class B Exercise Price; and

     

              WHEREAS, the Company desires the Warrant Agent
to act on behalf of the Company, and the Warrant Agent is willing to so act, in
connection with the issuance, exercise, exchange and replacement of the
certificates representing the Warrants (as defined herein) (the “Warrant Certificates”) and other
matters provided herein.

     

    

    
    

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

     

              SECTION 1. Definitions. As used in this Agreement, the following
terms, when capitalized, shall have the meanings assigned below: 

     

         “Affiliate” means, with respect to any Person, any
entity which controls such Person, any entity which such Person controls, or any
entity which is under common control with such Person. 

     

         “Business Day” means any day other than a Saturday, Sunday
or legal holiday on which the commercial banks in the City of New York, Borough
of Manhattan, are required or permitted by law to remain closed. 

     

         “Class A Warrants” has the meaning specified in the preamble.

     

         “Class A Exercise Price” means US$_____, as such price may be
modified from time to time in accordance with the provisions herein.

     

         “Class B Warrants” has the meaning specified in the preamble.

     

         “Class B Exercise Price” means US$_____, as such price may be
modified from time to time in accordance with the provisions herein.

     

         “Common Stock” means the common stock, par value $0.10 per
share, of the Company and any other security exchanged or substituted for such
common stock or into which such common stock is converted in any
recapitalization, reorganization, merger, consolidation, share exchange or other
business combination transaction, including any reclassification consisting of a
change in par value or a change from par value to no par value or vice versa.

     

         “Daily Market Price” for any trading day means the
volume-weighted average of the per share selling prices on the New York Stock
Exchange or other principal United States securities exchange or inter-dealer
quotation system on which the relevant security is then listed or quoted or, if
there are no reported sales of the relevant equity security on such trading day,
the average of the high bid and low ask price for the relevant equity security
on the last trading day on which such sale was reported or, if there are no high
bid and low ask prices, the Daily Market Price shall be the per share fair
market value of the relevant equity security as determined by an investment
banking firm of national reputation and standing selected by the Company and
reasonably acceptable to a Majority of the Warrant Holders (in which case, only
a single determination of value need be made by an investment banking firm,
notwithstanding any provision in the Agreement requiring an average over more
than one (1) trading day). 

     

    - 2 - 

     

    

    
    

         “Exchange Act” means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder, as the same
may be amended from time to time. 

     

         “Exercise Notice” has the meaning specified in Section 5.

     

         “Exercise Price” means the Class A Exercise Price (with
respect to the Class A Warrants) or the Class B Exercise Price (with respect to
the Class B Warrants). 

     

         “Expiration Date” means 5:00 P.M. New York City time, December
13, 2012. 

     

         “Holder” means the Initial Holders and their
successors and permitted assigns who become holders of Warrants in a manner
permitted under this Agreement, in each case until the relevant person ceases to
be a Holder of Warrants in accordance with the provisions hereof. 

     

         “Initial Holder” means the persons to whom or for whose
benefit Warrants are issued under the terms of the Vishay Intertechnology
Warrant Agreement and the terms of the Master Separation Agreement and who are
listed on Schedule I hereto, in each case until the relevant person ceases to be
a Holder of Warrants in accordance with the provisions hereof. 

     

          “Issue Date” means the date of this Agreement, which is
the date as of which the Warrants are first being issued. 

     

         “Majority of the Warrant
Holders” means, at any
relevant time, the Holders of Warrants that are exercisable for more than 50% of
the Warrant Shares for which all outstanding Warrants are exercisable at such
time. 

     

         “Master Separation Agreement” has the meaning specified in the preamble.

     

         “Person” means any individual, corporation,
partnership, limited liability company, trust, foundation, joint venture,
association, joint stock company, unincorporated organization, government
agency, estate or other entity of any nature. 

     

          “Regulation S” means Regulation S under the Securities Act,
including any successor rule or regulation. 

     

         “Rule 144” means Rule 144 under the Securities Act,
including any successor rule or regulation. 

     

         “Rule 144A” means Rule 144A under the Securities Act,
including any successor rule or regulation. 

     

         “SEC” means the United States Securities and
Exchange Commission. 

     

    - 3 - 

     

    

    
    

         “Securities Act” means the United States Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder, as the
same may be amended from time to time. 

     

         “Transfer” means any disposition of any Warrants or of
any interest therein, which would constitute a “sale” within the meaning of the
Securities Act. 

     

         “Transfer Agent” has the meaning specified in Section 10.

     

         “Transfer Document” has the meaning specified in Section 4.

     

         “Vishay Intertechnology Warrant
Agreement” has the meaning
specified in the preamble. 

     

         “Warrants” means Class A Warrants or Class B Warrants,
subject to adjustment as specified in this Agreement. 

     

         “Warrant Agent” has the meaning specified in the
preamble.

     

         “Warrant Certificates” has the meaning specified in the
preamble.

     

         “Warrant Register” has the meaning specified in Section 3.

     

         “Warrant Shares” means shares of Common Stock issuable or
issued upon exercise of the Warrants, which shall be subject to adjustment as
specified in this Agreement. 

     

              Where the reference “hereof,” “hereby” or
“herein” appears in this Agreement, such reference shall be deemed to be a
reference to this Agreement as a whole. Whenever the words “include,” “includes”
or “including” are used in this Agreement, they shall be deemed to be followed
by the words “without limitation.” Words denoting the singular include the
plural, and vice versa, and references to it or its or words denoting any gender
shall include all genders. 

     

              SECTION
2. Warrant Certificates. 

     

              (a) Initial Issuance. Promptly following the execution of this
Agreement, the Company shall deliver to the Warrant Agent a list of the names of
the Initial Holders and the number and class of Warrants to which each Initial
Holder is entitled, totaling, in the aggregate, Warrants to issue _______shares
of Common Stock. The Company shall deliver to the Warrant Agent, along with this
Agreement, a sufficient number of duly executed Warrant Certificates. The
Warrant Agent is hereby authorized by the Company to promptly issue and deliver
(i) the Class A Warrants, as evidenced by warrant certificates in the form
attached hereto as Exhibit A, to purchase the number of shares of Common
Stock of the Company as set forth in the Purchase Agreement and (ii) the Class B
Warrants, as evidenced by warrant certificates in the form attached hereto as
Exhibit B, to purchase the number of shares of Common
Stock of the Company as set forth in the Purchase Agreement. The Warrant
Certificates requested by the Company shall be completed and countersigned by
the Warrant Agent and promptly delivered to the Company to be mailed or
delivered to the Holders pursuant to the terms hereof. 

     

    - 4 - 

     

    

    
    

              (b) Forms of Warrant
Certificates. Each Warrant
Certificate to be delivered pursuant to the Vishay Intertechnology Warrant
Agreement and the Master Separation Agreement, and any additional Warrant
Certificate that may be issued upon partial exercise, replacement or transfer of
any Warrant, shall be in registered form only and shall be substantially in the
form set forth in Exhibit A hereto (if such Warrant is a Class A Warrant) or
Exhibit B (if such Warrant is a Class B Warrant) (including the form of election
and the form of assignment). A single Warrant Certificate may evidence the
issuance to a holder thereof of more than one Warrant; provided, however, that
Class A Warrants and Class B Warrants may not be evidenced together by the same
certificate. Warrants may be divided or combined with other Warrants owned by
the same Holder upon presentation at the office of the Warrant Agent, together
with a written notice specifying the denominations in which new Warrants are to
be issued, signed by the Holder thereof or its agent or attorney. As to any such
division or combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or combined.

     

              (c) Execution of Warrant
Certificates. Warrant
Certificates shall be signed on behalf of the Company by the Chairman or Vice
Chairman of the Board or its President or a Vice President and by its Secretary
or an Assistant Secretary under its corporate seal, and countersigned by an
authorized officer of the Warrant Agent. Each such signature upon the Warrant
Certificates may be in the form of a facsimile signature of the present or any
future Chairman or Vice Chairman of the Board, President, Vice President,
Secretary or Assistant Secretary and may be imprinted or otherwise reproduced on
the Warrant Certificates, and for that purpose the Company may adopt and use the
facsimile signature of any person who shall have been Chairman or Vice Chairman
of the Board, President, Vice President, Secretary or Assistant Secretary,
notwithstanding the fact that at the time the Warrant Certificates shall be
delivered or disposed of he shall have ceased to hold such office. The seal of
the Company may be in the form of a facsimile thereof and may be impressed,
affixed, imprinted or otherwise reproduced on the Warrant Certificates.

     

              In case any officer of the Company who shall
have signed any of the Warrant Certificates shall cease to be such officer
before the Warrant Certificates so signed shall have been disposed of by the
Company, such Warrant Certificates nevertheless may be delivered or disposed of
as though such person had not ceased to be such officer of the Company; and any
Warrant Certificate may be signed on behalf of the Company by any person who, at
the actual date of the execution of such Warrant Certificate, shall be a proper
officer of the Company to sign such Warrant Certificate, although at the date of
the execution of this Warrant Agreement any such person was not such an officer.

     

              (d) Rights Conferred. Each Class A Warrant shall evidence the
right to purchase one share of Common Stock at the Class A Exercise Price of
$_____ (subject to adjustment as described herein). Each Class B Warrant shall
evidence the right to purchase one share of Common Stock at the Class B Exercise
Price of $_____ (subject to adjustment as described herein). Following the
Expiration Date, any Warrant not previously exercised shall be null and void.

     

              SECTION 3. Warrant Register. The Warrant Agent shall number and register
the Warrant Certificates in a register (the “Warrant Register”) as they are
issued. The Company may deem and treat such registered Holders of the Warrant
Certificates as the absolute owners thereof (notwithstanding any notation of
ownership or other writing thereon made by anyone), for all purposes, and shall
not be affected by any notice to the contrary.

     

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              SECTION
4. Transfers. 

     

              (a) Restrictions on Transfer. Each Holder agrees that any proposed
Transfer of any Warrant may be effected only (1)(w) inside the United States (I)
to a person who the seller reasonably believes is a qualified institutional
buyer within the meaning of Rule 144A in a transaction meeting the requirements
of Rule 144A, (II) in accordance with Rule 144 or (III) pursuant to another
exemption from the registration requirements of the Securities Act, (x) to the
Company, (y) outside the United States (I) to a non-U.S. person (within the
meaning of Regulation S) in a transaction meeting the requirements of Regulation
S or (II) pursuant to another exemption from the registration requirements of
the Securities Act or (z) pursuant to an effective registration statement and
(2) in each case, in accordance with the applicable securities laws of any state
of the United States or any other applicable jurisdiction. Each Holder agrees to
notify any purchaser of the resale restrictions set forth above. 

     

              (b) Requirements Prior to
Transfer. Prior to any
Transfer or proposed Transfer of any restricted Warrants, the Holder thereof
shall deliver written notice, a form of which is attached hereto, to the Company
and the Warrant Agent of such holder’s intention to effect such transfer. If the
Transfer or proposed Transfer is pursuant to clause (1)(w) or (1)(y) of the
first sentence of the preceding paragraph, then upon receipt of such notice, the
Company may request any or all of the following (each, a “Transfer Document”) in
a form reasonably acceptable to the Company: 

     

         (i) an agreement by such transferee to the
impression of the restrictive investment legend set forth below on the
Warrant;

     

         (ii) an agreement by such transferee, in form and
substance reasonably satisfactory to the Company, to be bound by the provisions
of this Section 4 relating to the transfer of such Warrant; and 

     

         (iii) an opinion of counsel with expertise in
securities law matters reasonably satisfactory to the Company that such Transfer
complies with applicable securities laws. 

     

              If the Company requests any Transfer
Document(s), it shall do so as promptly as practicable following receipt of the
Holder’s notice of intention to Transfer. The Company shall thereafter cause the
Transfer to be recorded and a certificate or other evidence of ownership in the
name of the transferee to be delivered as soon as practicable after it has
received Transfer Documents complying with the terms of this Section 4(b).

     

              (c) Legend. The Holders agree that each Warrant
Certificate shall bear a legend to the following effect: 

     

    THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN
ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT
FROM SUCH REGISTRATION.

     

    - 6 - 

     

    

    
    

    The foregoing legend
shall be in addition to any other legend required by law. 

     

              (d) Termination of Restrictions. The restrictions referenced in Section 4(a),
4(b), and 4(c) of this Agreement, including the legend, shall cease and
terminate as to any particular Warrants or Warrant Certificates when (x) such
Warrants or Warrant Shares have been transferred in a transaction pursuant to
Rule 144 or a registration statement or (y) in the reasonable opinion of counsel
for the Company, such restriction is no longer required in order to assure
compliance with the Securities Act and applicable state securities laws.
Whenever such restrictions shall cease and terminate as to any Warrants, the
Holder of such Warrants shall be entitled to receive from the Company, without
expense (other than applicable transfer taxes, if any, if such unlegended shares
are being delivered and transferred to any person other than the registered
Holder thereof), new certificates for a like number of Warrants not bearing the
relevant legend(s) set forth in Section 4(c). 

     

              (e) Registration of Warrants. The Warrant Agent shall from time to time
register the Transfer of any outstanding Warrant Certificates in the Warrant
Register upon surrender thereof accompanied by a written instrument or
instruments of transfer in the form set forth herein, duly executed by the
registered Holder or Holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. Upon any such
registration of Transfer, the Warrant Agent shall issue a new Warrant
Certificate to the transferee(s), and the surrendered Warrant Certificate shall
be canceled and disposed of by the Warrant Agent. If less than all of the
Warrants represented by a Warrant Certificate are Transferred, the Warrant Agent
shall issue to the Holder a Warrant Certificate representing the remaining
Warrants. 

     

              SECTION
5. Exercise of Warrants. 

     

              (a) Exercise. A Warrant may be exercised upon surrender to
the Warrant Agent (at its office designated for such purpose, the initial
address of such office being listed in Section 15 hereof) of the Warrant
Certificate or Certificates evidencing the Warrants to be exercised with the
form of election to purchase attached hereto (the “Exercise Notice”) duly filled
in and signed, together with any documentation or opinion reasonably required by
the Company or the Warrant Agent specified in Section 5(b) below, and (except as
provided in Section 5(e)) upon payment to the Company of the applicable Exercise
Price for the number of Warrant Shares in respect of which such Warrants are
then exercised. Payment of such aggregate Exercise Price shall be made by wire
transfer to an account of the Company or by certified or official bank check to
the order of the Company. All Warrant Certificates surrendered upon exercise of
Warrants shall be canceled and disposed of by the Warrant Agent. Each Warrant
initially shall be exercisable for one share of Common Stock, subject to
adjustment as provided herein.

     

    - 7 - 

     

    

    
    

              (b) Certain Conditions of
Exercise. Unless the
issuance of Warrant Shares upon exercise of the Warrants shall have been
registered under the Securities Act, the Warrants may only be exercised pursuant
to an exemption from registration under the Securities Act (which in the case of
non-U.S. persons may be pursuant to Regulation S). As a condition of any
proposed exercise of the Warrants in these circumstances, if requested by the
Company, the Holder shall deliver to the Company (i) an agreement by the Holder
(or any transferee of the Holder if the Warrant Shares are to be issued in a
name other than the name in which the Warrant Certificate is registered), in
form and substance reasonably satisfactory to the Company, to the effect that
the Warrant Shares may not be transferred except pursuant to an exemption from
registration under the Securities Act and (ii) an opinion of counsel with
expertise in securities law matters reasonably satisfactory to the Company that
such exercise complies with applicable securities laws. In addition, the Holders
agree that each certificate representing the Warrant Shares shall bear a legend
to the effect recited in Section 4(c). If the Warrant Shares are issued without
registration, they shall be subject to the same restrictions and have the same
rights with respect to termination of restrictions as provided with respect to
the Warrants under Section 4. 

     

              (c) Exercise in Whole or in
Part. The Warrants
represented by a Warrant Certificate shall be exercisable, at the election of
the Holder thereof, either in full or from time to time in part and, in the
event that a Warrant Certificate is exercised in respect of fewer than all of
the Warrants represented thereby at any time prior to the date of expiration of
the Warrants, a new Warrant Certificate evidencing the remaining Warrant or
Warrants will be issued and delivered by the Warrant Agent pursuant to the
provisions of this Section and of Section 2 hereof.

     

              (d) Issuance of Warrant Shares. Subject to the provisions of this Agreement
(including, but not limited to Section 5(e)), upon such surrender of the Warrant
Certificates and receipt of the Exercise Price, the Company shall issue and
cause to be delivered to or upon the written order of the Holder and, subject to
Section 5(b) above, in such name or names as the Warrant Holder may designate, a
certificate or certificates or other evidences of ownership for the aggregate
number of fully paid and nonassessable Warrant Shares issuable upon the exercise
of such Warrants together with payment of the applicable Exercise Price. The
stock certificate or certificates representing such Warrant Shares shall be
delivered in such denominations as may be specified in the Exercise Notice
received by the Company and shall be registered in the name of such holder or in
such other name or names as shall have been designated in the Exercise Notice.
Such certificate or certificates shall be deemed to have been issued and any
person so designated to be named therein shall be deemed to have become a Holder
of record of such Warrant Shares as of the date of the surrender of such Warrant
Certificates and payment of the Exercise Price. 

     

              (e) Exercise in Connection with Certain
Transfers. If a Holder or
Holders shall sell Warrant Shares in an underwritten offering, the Company shall
cooperate with the Holders and the underwriters for such offering so that the
Warrants may be exercised and the Warrant Shares delivered to the underwriters
for sale in the offering and, upon consummation of the offering, the
underwriters shall deliver the Exercise Price for the Warrants to the Company
out of the proceeds of the offering.

     

    - 8 - 

     

    

    
    

              SECTION 6. Specific Limitations on the Rights of Warrant
Holders. Prior to the
exercise of the Warrants, except as may be specifically provided for herein and,
without prejudice to Section 11(b)(ii) hereof, (i) no Holder of a Warrant
Certificate, as such, shall be entitled to any of the rights of a holder of
Common Stock, including, without limitation, the right to vote at or receive any
notice of any meetings of stockholders; (ii) the consent of any such Holder
shall not be required with respect to any action or proceeding of the Company;
(iii) no such Holder, by reason of the ownership or possession of a Warrant or
the Warrant Certificate representing the same, shall have any right to receive
any cash dividends, stock dividends, allotments or rights or other distributions
paid, allotted or distributed or distributable to the stockholders of the
Company prior to, or for which the relevant record date preceded, the date of
the exercise of such Warrant; and (iv) no such Holder shall have any right not
expressly conferred by the Warrant or Warrant Certificate held by such Holder.

     

              SECTION
7. Exercise Period; Expiration. 

     

              (a) Exercise Period. Each Warrant shall be exercisable at any
time during the period from and after the Issue Date until its respective
Expiration Date. 

     

              (b) Expiration. Any Warrant not exercised prior to its
respective Expiration Date shall become void, and all rights thereunder and all
rights in respect thereof under this Agreement shall cease as of such time.

     

              SECTION 8. Payment of Taxes. The Company will pay all documentary stamp
taxes attributable to the initial issuance of Warrant Shares upon the exercise
of Warrants; provided, however, that the Company shall not be required to pay
any tax or taxes which may be payable in respect of any transfer involved in the
issue of any Warrant Certificates or any certificates for Warrant Shares in a
name other than that of the registered Holder of a Warrant Certificate
surrendered for registration of transfer or upon the exercise of a Warrant, and
the Company shall not be required to issue or deliver such Warrant Certificates
unless and until the person or persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to the
reasonable satisfaction of the Company that such tax has been paid.

     

              SECTION 9. Mutilated or Missing Warrant
Certificates. In case any
of the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Warrant Agent shall issue, in exchange and substitution for and upon
cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, and may in its discretion require evidence reasonably satisfactory to
it of such loss, theft or destruction of such Warrant Certificate and indemnity
reasonably satisfactory to it. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable regulations and pay
such other reasonable charges as the Company may require. 

     

    - 9 - 

     

    

    
    

              SECTION
10. Covenants of the Company. 

     

              (a) Reservation of Warrant
Shares. The Company will
at all times reserve and keep available, out of the aggregate of its authorized
but unissued shares of Common Stock or its authorized and issued shares of
Common Stock held in its treasury, for the purpose of enabling it to satisfy any
obligation to issue Warrant Shares upon exercise of Warrants, the maximum number
of shares of Common Stock which may then be deliverable upon the exercise of all
outstanding Warrants. The Company or, if appointed, the transfer agent for the
Common Stock (the “Transfer Agent”) and every subsequent transfer agent for any
shares of the Company’s capital stock issuable upon the exercise of any of the
Warrants shall be authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company shall keep
a copy of this Agreement on file with the Transfer Agent and with every
subsequent transfer agent for any shares of the Company’s capital stock issuable
upon the exercise of the Warrants. The Company will furnish such Transfer Agent
a copy of all notices of adjustments and certificates related thereto,
transmitted to each Holder. 

     

              (b) Due Issuance. Warrant Shares, when issued pursuant to the
terms and conditions hereof, shall be duly and validly issued and fully-paid and
non-assessable, and free from all liens, encumbrances and other charges thereon.

     

              (c) Authorizations. Before taking any action which would result
in an adjustment in the number of shares of Common Stock, the Company shall
obtain all authorizations or exemptions thereof, or consents thereto, as may be
required by law, except where failure to do so would not result in a material
adverse effect on the rights of the Holders or the Company. 

     

              (d) Listing. The Company will list or cause to have
quoted such Common Stock issuable upon exchange of the Warrants on each
securities exchange or such other market on which the Common Stock is then
listed or quoted. 

     

              SECTION 11. Adjustment of Number of Warrant Shares and
Exercise Price. The number
of Warrant Shares issuable upon the exercise of each Warrant and its Exercise
Price are subject to adjustment from time to time upon the occurrence of the
events enumerated in this Section 11. 

     

              (a) Declaration of Stock Dividend, Splits, Reverse
Splits or Reclassification or Reorganization; Other
Distributions.

     

         (i) In case the Company shall declare any dividend
or other distribution upon its outstanding shares of Common Stock payable in
Common Stock or shall subdivide its outstanding shares of Common Stock into a
greater number of shares, then the number of shares of Common Stock which may
thereafter be purchased upon the exercise of any Warrant shall be increased in
proportion to the increase in the number of shares of Common Stock outstanding
through such dividend, other distribution, or subdivision and the Exercise Price
per share shall be decreased in such proportion such that the amount payable to
the Company upon the exercise of a Warrant shall be the same after such
adjustment as before such adjustment. In case the Company shall at any time
combine the outstanding shares of its Common Stock into a smaller number of
shares, the number of shares of Common Stock which may thereafter be purchased
upon the exercise of any Warrant shall be decreased in proportion to the
decrease in the number of shares of Common Stock outstanding through such
combination and the Exercise Price per share shall be increased in such
proportion such that the amount payable to the Company upon the exercise of a
Warrant shall be the same after such adjustment as before such adjustment. The
Company shall cause a notice to be mailed to each Holder at least ten (10)
Business Days prior to the applicable record date for the activity covered by
this Section 11(a)(i). The Company’s failure to give the notice required by this
Section 11(a)(i) or any defect therein shall not affect the validity of the
activity covered by this Section 11(a)(i). Notwithstanding the foregoing,
nothing in this paragraph will prejudice the rights of the Holders pursuant to
this Agreement.

     

    - 10 - 

     

    

    
    

         (ii) In case the Company shall at any time
(including in connection with any merger, consolidation or sale of all or
substantially all the assets of the Company in which Section 11(d) hereof is not
applicable) (i) issue any evidence of indebtedness, shares of its stock or any
other securities to all holders of shares of Common Stock by reclassification of
its shares of Common Stock, (ii) distribute any rights, options or warrants to
purchase or subscribe for any evidence of indebtedness, shares of its stock
(other than distributions for which adjustment may be made pursuant to Section
11(b) or Section 11(e)) or any other securities to all holders of shares of
Common Stock, (iii) distribute cash (other than regular quarterly or semi-annual
cash dividends) or other property to all holders of shares of Common Stock, or
(iv) issue by means of a capital reorganization other securities of the Company
in lieu of the Common Stock or in addition to the Common Stock, then the Warrant
shall be adjusted so that the Warrant shall be exercisable into the kind and
number of shares or other securities of the Company or the successor entity or
cash or other property as that the Holder would have owned or have been entitled
to receive after the happening of the event described above, had such Warrant
been exercised immediately prior to the happening of such event or any record
date with respect thereto. The Company shall cause a notice to be mailed to each
Holder at least ten (10) Business Days prior to the applicable record date for
the activity covered by this Section 11(a)(ii). The Company’s failure to give
the notice required by this Section 11(a)(ii) or any defect therein shall not
affect the validity of the activity covered by this Section 11(a)(ii).
Notwithstanding the foregoing, nothing in this paragraph will prejudice the
rights of the Holders pursuant to this Agreement. 

     

         (iii) An adjustment made pursuant to this Section
11(a) shall become effective immediately after the effective date of such event
retroactive to the record date, if any, for such event. 

     

         (b) Adjustment for Rights
Issuance. 

     

         (i) (A) In case the Company shall at any time
distribute any rights, options or warrants to all holders of Common Stock
entitling them, for a period expiring sixty (60) days or less after the date of
determination of the stockholders entitled to receive such rights (the
“Record Date”) (or any longer period resulting from the
extension of the exercise period which is announced following the time that the
rights, options or warrants are first issued) for such distribution, to purchase
or subscribe for shares of Common Stock at a price per share less than ninety
percent (90%) of the Daily Market Price of the Common Stock on the Record Date,
then the number of shares issuable upon exercise of each Warrant immediately
prior thereto shall be adjusted in accordance with the formula: 

     

    N = No x (O + A)/ (O +
(C/M))

     

    - 11 - 

     

    

    
    

         where: 

     

    
      	      	N	      	=	      	the
      adjusted number of Warrant Shares issuable upon exercise of such
      Warrant.
	
            	 
	
            	No	
            	=	
            	the number of
      Warrant Shares issuable upon exercise of such Warrant prior to such
      adjustment.
	
            	 
	
            	O	
            	=	
            	the number of
      shares outstanding immediately prior to the issuance of such rights,
      options or warrants as referred to in this Section
  11(b)(i)(A).
	
            	 
	
            	A	
            	=	
            	the maximum
      number of shares issuable pursuant to such rights, options or warrants as
      referred to in this Section 11(b)(i)(A).
	
            	 
	
            	C	
            	=	
            	the aggregate consideration receivable
      by the Company for the issuance of Common Stock upon exercise of such
      rights, options or warrants as referred to in this Section
      11(b)(i)(A).
	
            	 
	
            	M	
            	=	
            	the average of the Daily Market Prices
      of the Common Stock for the ten (10) consecutive trading days immediately
      preceding the Record Date.

    

     

         Provided that, in no adjustment
shall N be less than No. 

     

         (B) If any adjustment is made to
increase the number of shares issuable upon exercise of any Warrant pursuant to
this Section 11(b), the Exercise Price per share of such Warrant shall be
correspondingly decreased, such that the amount payable to the Company upon the
exercise of a Warrant shall be the same after such adjustment as before such
adjustment. The adjustment shall become effective immediately after the Record
Date for the determination of shareholders entitled to receive the rights,
warrants or options to which this Section 11(b) applies. If less than all of
such rights, warrants or options have been exercised when such rights, warrants
or options expire, then the number of shares issuable upon the exercise of each
Warrant and corresponding adjustment to the Exercise Price of each such Warrant
shall promptly be readjusted to the number of shares issuable upon the exercise
of each Warrant and the Exercise Price that would then be in effect had the
adjustment upon the issuance of such rights, warrants or options been made on
the basis of the actual number of shares of Common Stock issued upon the
exercise of such rights, warrants or options. 

     

         (ii) In case the Company shall at any time
distribute any rights, options or warrants to all holders of Common Stock
entitling them, for a period expiring more than sixty (60) days after the Record
Date therefor (excluding any rights, options or warrants originally issued with
an exercise period of sixty (60) days or less, which, by virtue of one or more
extensions, expire more than sixty (60) days after the Record Date therefor), to
purchase or subscribe for shares of Common Stock at a price per share less than
ninety percent (90%) of the Daily Market Price of the Common Stock as of such
Record Date, then the Company shall similarly distribute such rights, options or
warrants to the Holders on such Record Date (without any exercise of Warrants by
Holders) as if such Holders had exercised their Warrants immediately prior to
the Record Date. 

     

    - 12 - 

     

    

    
    

              (c) Liquidation, Dissolution or Winding
Up. Notwithstanding any
other provisions hereof, in the event of the liquidation, dissolution, or
winding up of the affairs of the Company (other than in connection with a
consolidation, merger or sale or conveyance of all or substantially all of its
assets or a Change or Spin-Off), the right to exercise this Warrant shall
terminate and expire at the close of business on the last full business day
before the earliest date fixed for the payment of any distributable amount on
the Common Stock. The Company shall cause a notice to be mailed to each Holder
at least ten (10) Business Days prior to the applicable record date for such
payment stating the date on which such liquidation, dissolution or winding up is
expected to become effective, and the date on which it is expected that holders
of record of shares of Common Stock shall be entitled to exchange their shares
of Common Stock for securities or other property or assets (including cash)
deliverable upon such liquidation, dissolution or winding up, and that each
Holder may exercise outstanding Warrants during such ten (10) Business Day
period and, thereby, receive consideration in the liquidation on the same basis
as other previously outstanding shares of the same class as the shares acquired
upon exercise. The Company’s failure to give notice required by this Section
11(c) or any defect therein shall not affect the validity of such liquidation,
dissolution or winding up. Notwithstanding the foregoing, nothing in this
paragraph will prejudice the rights of the Holders pursuant to this Agreement.

     

              (d) Merger, Consolidation, Etc. 

     

         (i) In any event when (A) any person (the
“Acquirer”) directly or indirectly acquires the Company in a transaction in
which the Company is merged with or into or consolidated with another person or
(B) the Company sells or conveys all or substantially all of its assets to
another person (unless, subsequent to such merger, consolidation or the
transaction, the Company is the surviving entity and has reporting obligations
under the Exchange Act as a result of having common equity securities
outstanding, in which case, this Section shall not apply with respect to such
merger, consolidation or other transaction)(such merger, consolidation or other
transaction referred to hereinafter as a “Change”), then, upon exercise of each Warrant at any
time after the consummation of the Change but prior to the Expiration Date, in
lieu of the shares of the Company’s Common Stock (or other securities, cash,
assets or other property) purchasable upon the exercise of the Warrant prior to
such Change, the Holder shall be entitled to receive such shares of stock,
securities, cash, assets or any other property whatsoever (including warrants or
other purchase or subscription rights) which such Holder would have been
entitled to receive after the happening of such Change had such Warrant been
exercised immediately prior to such Change. 

     

    - 13 - 

     

    

    
    

         (ii) Notwithstanding the foregoing, but subject to
the following sentence, if a Holder of a Warrant so elects by giving written
notice thereof to the Company on or before the day immediately preceding the
date of the consummation of such Change, the Holder shall not be required to
make any payment upon exercise of the Warrant, and shall be entitled to receive
from the Company or the Acquirer (in lieu of the adjustment provided for in
Section 11(d)(i) above) a cash amount equal to the Black-Scholes Value of the
Warrant (the “Cash-Out Option”) upon surrender of the Warrant Certificate
representing such Warrant. The right of a Holder to elect the Cash-Out Option
shall not be available if 

     

    
      	               	(A)	 	the payment or offering of any Cash-Out Option would
	
            	
            	
            	 
	
            	  	 	(x) in
      the reasonable opinion of counsel to the Company, prevent a Change from
      otherwise being treated as a tax-free reorganization; or
	
            	  	 	 
	
            	  	 	(y) in the reasonable opinion of counsel
      or accountants to the Company, prevent a Change from being accounted for
      using a pooling of interests accounting method or other similar accounting
      method, if any, under US GAAP which would otherwise be available;
      and
	
            	  	 	 
	
            	(B)	 	the payment of the Cash-Out Option in the form of securities of the
      Acquirer, as described below, would not preserve such tax or accounting
      treatment.

    

    If the payment of the Cash-Out Option in the form of Acquirer securities
issued to the Company’s stockholders in the Change (the “Acquirer Securities”)
would preserve the tax or accounting treatment of the Change, the Holders shall
have the right to elect the Cash-Out Option, but only in the form of Acquirer
Securities. In such case, 

     

    (1) the Cash-Out Option will be payable in the Acquirer Securities; and

     

    (2) the number of securities payable to the Holder on exercise of the
Cash-Out Option will equal (x) the dollar amount of the Cash-Out Option divided
by (y) the per share (or other unit) fair market value of the securities in
which the Cash-Out Option is payable. 

     

    “Fair market value” for this purpose means the average Daily Market Price
of the securities of the Acquirer for the first ten (10) consecutive trading
days immediately preceding but not including the date of effectiveness of the
Change; provided, however, that if the securities of the Acquirer are not listed
or traded on an exchange or interdealer quotation system, then the “fair market
value” of such securities shall be determined by an investment banking firm of
national reputation and standing selected by the Company and reasonably
acceptable to a Majority of the Warrant Holders. If the Holders of the Warrants
do not have the right to elect the Cash-Out Option provided in Section 11(d)(ii)
herein, the adjustment provided for in Section 11(d)(i) above shall apply.

     

    - 14 - 

     

    

    
    

         (iii) Notwithstanding the foregoing, in the case of any such Change
where,

     

         (A) the Acquirer is a company with reporting obligations under the Exchange
Act with respect to common equity securities (such common equity securities
being referred to herein as the “Acquirer Shares”), and 

     

         (B) the Acquirer is offering as consideration with respect to the Change a
combination of Acquirer Shares and cash or other consideration, 

     

    if a Holder of a Warrant so elects by giving written notice thereof to
the Company on or before the day immediately preceding the effective date of
such Change, then, in lieu of the adjustment to the Warrant provided under
Section 11(d)(i), upon the consummation of the Change and surrender of the
Certificate representing the Warrant, the Holder shall receive (x) a warrant (an
“Acquirer Warrant”) exercisable for Acquirer Shares, in an
amount and for an exercise price calculated as described below, and (y) a cash
amount, calculated as described below (the “Adjusted Cash-Out Option”). The terms of the Acquirer Warrants shall
be identical to the terms of the Warrants mutatis mutandis, except that the
exercise price and the number of securities issuable upon the exercise of the
Acquirer Warrants (subject to adjustment as provided therein) shall be
determined as provided below: 

     

    the Exercise Price of the Acquirer Warrants shall be calculated as
follows: 

     

    Ew = (Eo x (Pa/Pt)) 

     

    where: 

     

    
      	      	Ew	     	=	     	the adjusted Exercise Price of the
      Acquirer Warrants.
	
            	
            	
            	
            	
            	 
	
            	Eo	
            	=	
            	the Exercise Price of
      the Warrants immediately prior to such adjustment.
	
            	
            	
            	
            	
            	 
	
            	Pt	
            	=	
            	the average of the
      Daily Market Prices of the Common Stock for the ten (10) consecutive
      trading days immediately preceding the effective date of the
    Change.
	 	  	
            	  	
            	 
	
            	Pa	
            	=	
            	the fair market value
      per share of the Acquirer Shares. As used in this formula, “fair market
      value” shall mean the average Daily Market Price of the Acquirer Shares
      for the ten (10) consecutive trading days immediately preceding the
      effective date of the Change.

    

    The number of Acquirer Shares issuable upon exercise of an Acquirer
Warrant shall be calculated as follows: 

     

    N = a x No

     

    - 15 - 

     

    

    
    

         where:

    
    

     

    
      	      	N	     	=	     	the number of shares issuable by the Acquirer upon exercise of the
      Acquirer Warrant.
	
            	
            	
            	
            	
            	 
	
            	a	
            	=	
            	the number of Acquirer Shares delivered in the Change to holders of
      Common Stock for each share of Common Stock.
	
            	
            	
            	
            	
            	 
	
            	No	
            	=	
            	the number of Warrant
      Shares issuable upon exercise of the original Warrant in exchange for
      which the Acquirer Warrant was issued.

    

     

    If the Holders of Common Stock may elect to receive in the Change
Acquirer Shares, cash or other consideration, or a combination of Acquirer
Shares and cash or other consideration as selected by the Holders (whether or
not subject to proration), then the number of Acquirer Shares delivered in the
Change for each share of Common Stock shall be determined, for purposes of the
preceding formula and the determination below of the amount of the Adjusted
Cash-Out Option, as follows: a = Nas/Nts

     

    a = Nas/Nts

     

         where

     

    
      	      	Nas	     	=	     	the aggregate number of Acquirer Shares
      delivered in the Change to holders of Common Stock.
	
            	
            	
            	
            	
            	 
	
            	Nts	
            	=	
            	the total number of shares of Common
      Stock outstanding immediately prior to the effectiveness of the Change and
      exchanged for consideration in the
Change.

    

     

    The amount of the Adjusted Cash-Out Option for a Warrant shall be
calculated as follows: 

     

    AC = BSw x
(1-((a x Pa)
/C)) 

     

    where the symbols previously defined in this Section have their
previously defined meanings and: 

     

    
      	      	AC	    	=	     	the amount of the Adjusted Cash-Out Option of the
  Warrant
	
            	
            	
            	
            	
            	 
	
            	BSw	
            	=	
            	the Black-Scholes Value of the Warrant,
      ignoring the effect of the Change, as determined pursuant to (iv)
      below.
	
            	
            	
            	
            	
            	 
	
            	C	
            	=	
            	the
      total fair market value of the consideration delivered in the Change to
      Holders of Common Stock for each share of Common Stock. For purposes of
      determining this amount—

    

    - 16 - 

     

    

    
    

    
      	
            	(A)	
            	the fair market value of the component
      of the consideration consisting of Acquirer Shares shall equal (x) the
      average Daily Market Price of the Acquirer Shares for the first ten (10)
      consecutive trading days immediately preceding the effective date of the
      Change multiplied by (y) the number of Acquirer Shares delivered in the
      Change for each share of Common Stock;
	
            	 
	              
    	(B)	    	the fair market value of any cash
      component shall be the amount of the cash delivered in the Change for each
      share of Common Stock; and
	
            	 
	
            	(C)	
            	the fair market value of any other
      consideration delivered in the Change for each share of Common Stock shall
      be as determined by an investment banking firm of national reputation and
      standing selected by the Company and reasonably acceptable to a Majority
      of the Warrant Holders.

    

     

    The right to make the election to receive Acquirer Shares and the
Adjusted Cash-Out Option as provided in this Section 11(d)(iii) shall be subject
to the same limitations as provided in Section 11(d)(ii)(A) and (B) above
regarding the right to elect the Cash-Out Option; provided, however, that if the
payment of the Adjusted Cash-Out Option in the form of Acquirer Securities would
preserve the tax or accounting treatment of the Change, the election may be
exercised with the Adjusted Cash-Out Option being paid in Acquirer Securities as
provided in clauses (1) and (2) of Section 11(d)(ii). 

     

         (iv) As used herein, “Black-Scholes Value” of the Warrants, shall be determined on the
basis of the Black-Scholes methodology by an investment banking firm of national
reputation and standing, selected by the Company and reasonably acceptable to a
Majority of the Warrant Holders; provided, however, that no Black-Scholes Value
of a Warrant shall exceed the Daily Market Price of the Common Stock on the day
immediately preceding the Change. For purposes of applying the Black-Scholes
methodology, (i) the price per share of the Common Stock shall be deemed to be
the average of the Daily Market Prices for the ten (10) full trading days ending
ten (10) trading days prior to the first public announcement of the Change, and
(ii) the methodology shall be applied as if the relevant Change had not
occurred. 

     

         (v) The Company shall give written notice of any
Change to each Holder, in accordance with Section 15 hereof, at least ten (10)
Business Days prior to the effective date of the Change; provided, however, that
if either Section 11(d)(ii) or (iii) is applicable, one or more notices shall be
given to the Holders sufficiently in advance of the Change to allow for
selection of the investment banking firm referred to in the previous paragraph
and for notice to the Holders of the Black-Scholes Value at least ten (10)
Business Days prior to the effective date of the Change. The Company’s failure
to give notice required by this Section 11(d) or any defect therein shall not
affect the validity of the Change covered by this Section 11(d). However, if the
Company fails to give notice, the responsibilities of the Company with respect
to this Section 11(d) shall be assumed by the Acquirer and nothing in this
paragraph will prejudice the rights of the Holders pursuant to this Agreement.

     

    - 17 - 

     

    

    
    

         (e) Spin-Off. 

     

         (i) In case the Company shall at any time pay a
dividend or make a distribution to all holders of its Common Stock consisting of
the capital stock of any class or series, or similar interests, of or relating
to a subsidiary or other business unit of the Company (such transaction, a
“Spin-Off”; such capital stock or other interests, the
“Spin-Off Shares”; and such subsidiary or business unit, the
“Spin-Off Company”), then each holder of a Warrant outstanding and unexercised
on the date of the Spin Off shall become entitled to a spin-off warrant
(“Spin-Off Warrants”) evidencing a right to purchase a number of
shares of capital stock of the Spin-Off Company that the Holder would have
received had the Holder exercised such Warrants immediately prior to the record
date for the Spin-Off (the “Spin-Off Record Date”); provided, however, that in the event that the distribution of
Spin-Off Shares to the Holders would, in the reasonable opinion of counsel to
the Company, (y) prevent the tax-free nature of such Spin-Off or (z) require
registration with the SEC in circumstances where registration would not
otherwise be required, then at the election of the Company, either (y) the
Holders shall not receive Spin-Off Warrants pursuant to this Section 11(e)(i)
and the Warrants shall instead be adjusted pursuant to the terms of Section
11(e)(ii) or (z) the Holders shall receive Spin-Off Warrants as contemplated
above in this Section 11(e)(i). The terms of the Spin-Off Warrants shall be
identical to the terms of the Warrants mutatis mutandis,
except that the exercise price of a Spin-Off Warrant (subject to adjustment as
provided therein) shall be determined by the following formula: 

     

    Es = Eo x Ps / (Pp+ (r x
Ps))

     

         where:

    
    

     

    
      	      	
              Es

            	     	=	     	the Exercise Price per Spin-Off Share of
      the Spin-Off Warrants.
	
            	
            	
            	
            	
            	 
	
            	Eo	
            	=	
            	the Exercise Price per
      share of Common Stock of the relevant Warrant immediately prior to
      adjustment for the relevant Spin-Off.
	
            	
            	
            	
            	
            	 
	
            	Pp	
            	=	
            	the average of the
      Daily Market Prices of the Common Stock for the ten (10) full consecutive
      trading days following the date on which the Spin-Off is
      consummated.
	 	  	
            	  	
            	 
	
            	r	
            	=	
            	the
      number of Spin-Off Shares (which may be one or a fraction less than or
      greater than one) distributed pursuant to the Spin-Off in respect of each
      share of Common Stock.
	
            	
            	
            	
            	
            	 
	
            	Ps	
            	=	
            	the fair market value
      per share of the Spin-Off Shares. As used in this section, “fair market
      value” shall mean the average Daily Market Price of the Spin-Off Shares
      for the first ten (10) consecutive trading days following the date on
      which the Spin-Off is consummated; provided, however, that if such distributed securities do
      not begin trading within two trading days of the consummation of such
      Spin-Off or do not trade for at least ten (10) consecutive trading days
      within twenty (20) days after the Spin-Off, then the “fair market value”
      of such distributed securities shall be determined by an investment
      banking firm of national reputation and standing selected by the Company
      and reasonably acceptable to a Majority of the Warrant Holders on the
      Spin-Off Record Date.

    

     

    - 18 - 

     

    

    
    

         Following the Spin-Off, the Exercise Price of each Warrant shall be
adjusted in accordance with the following formula:

     

    En = Eo x Pp / (Pp+ (r x Ps))

     

         where:

    
    

     

    
      	      	En	     	=	     	the adjusted exercise price per share of
      Common Stock of the Warrants.

    

     

    (with the other symbols in such formula having the meanings specified in
the preceding formula). 

     

         (ii) In case the Company shall engage in a
Spin-Off, and Section 11(e)(i) shall not be available to the Holders as a result
of the proviso in the first paragraph of Section 11(e)(i), then the Holders
shall not receive Spin-Off Warrants and instead the number of shares issuable
upon the exercise of each Warrant immediately prior thereto shall be adjusted in
accordance with the formula: 

     

    N = No x (Pp + (Ps x r))/Pp

     

         where: 

    
    

     

    
      	      	N	     
    	=	     
    	the
      adjusted number of Warrant Shares issuable upon exercise of such
      Warrant.
	
            	
            	
            	
            	
            	 
	
            	
              No

            	
            	=	
            	the number of Warrant
      Shares issuable upon exercise of such Warrant prior to such
      adjustment.
	
            	
            	
            	
            	
            	 
	
            	Pp	
            	=	
            	the average of the
      Daily Market Prices of the Common Stock for the ten (10) full consecutive
      trading days following the date on which the Spin-Off is
      consummated.
	
            	
            	
            	
            	
            	 
	
            	Ps	
            	=	
            	the average Daily
      Market Price of the Spin-Off Shares for the first ten (10) full
      consecutive trading days following the date on which the Spin-Off is
      consummated; provided, however, that
      if such distributed securities do not begin trading within two trading
      days of the consummation of such Spin-Off or do not trade for at least ten
      (10) consecutive trading days within twenty (20) days after the Spin-Off,
      then this quantity shall mean the “fair market value” per share of the
      Spin-Off Shares as of the date the Spin-Off is consummated, determined by
      an investment banking firm of national reputation and standing selected by
      the Company and acceptable to a Majority of the Warrant Holders on the
      Spin-Off Record Date.
	
            	
            	
            	
            	
            	 
	
            	r	
            	=	
            	the
      number of Spin-Off Shares (which may be one or a fraction less than or
      greater than one) distributed pursuant to the Spin-Off in respect of each
      share of Common Stock.

    

     

    - 19 - 

     

    

    
    

         If any adjustment is made to increase the number of Warrant Shares
issuable upon exercise of any Warrant pursuant to this Section 11(e)(ii), the
Exercise Price per share of such Warrant shall be adjusted in accordance with
the following formula. 

     

    En = Eo x (No/N)

     

         Where: 

    
    

     

    
      	      	En	     	=	     	the adjusted exercise price per share of
      Common Stock of the Warrants.
	
            	
            	
            	
            	
            	 
	
            	Eo	
            	=	
            	the Exercise Price per
      share of Common Stock of the relevant Warrant immediately prior to
      adjustment for the relevant Spin-Off.

    

     

         (with the other symbols in such formula having
the meanings specified in the preceding formula). 

     

         (iii) An adjustment made pursuant to Section
11(e)(ii) shall become effective immediately after the determination of the
adjusted number of Warrant Shares issuable upon exercise of the Warrants,
retroactive to the date for the Spin-Off. 

     

         (iv) The Company shall give written notice of any
Spin-Off, in accordance with Section 15 hereof, at least ten (10) Business Days
prior to the Record Date therefor. The Company’s failure to give notice required
by this Section 11(e)(iv) or any defect therein shall not affect the validity of
the Spin-Off covered by this Section 11(e). Notwithstanding the foregoing,
nothing in this paragraph will prejudice the rights of the Holders pursuant to
this Agreement. 

     

         (f) Good Faith Determination. 

     

         (i) Subject to the following clause (ii), any
determination as to whether an adjustment or limitation of exercise is required
pursuant to this Section 11 (and the amount of any adjustment) shall be binding
upon the Holders and the Company if made in good faith by the board of directors
of the Company. 

     

         (ii) If a Majority of the Warrant Holders shall
object to any determination of the board of directors of the Company within ten
(10) Business Days of receipt of notice of such determination, then such
determination shall be referred to a national independent accounting firm in the
United States (the “Accounting Firm”) selected by the Company and reasonably
acceptable to a Majority of the Warrant Holders. The determination of the
adjustment made by the Accounting Firm shall be strictly in accordance with the
terms of this Agreement and shall be binding upon the Holders and the Company.
The Accounting Firm shall be instructed to notify the Company and such Majority
of the Warrant Holders of its determination regarding the adjustment within
fifteen (15) Business Days of such referral. 

     

    - 20 - 

     

    

    
    

         (iii) Whenever this Agreement provides for the
reasonable approval or acceptance of a Majority of the Warrant Holders of any
action or determination, such approval or acceptance shall be deemed to be given
if a Majority of the Warrant Holders do not reasonably object to such action or
determination by written notice to the Company within ten (10) Business Days of
the date on which notice thereof is first given to the Holders. No objection
shall be deemed reasonable if the reasons for such objection are not set forth
in reasonable detail in the notice of objection given to the Company as
aforesaid. 

     

              (g) Notice of Adjustment. Whenever the number of shares of Common
Stock purchasable upon the exercise of the Warrants or the Exercise Price is
adjusted, the Company shall promptly file, in the custody of its Secretary or an
Assistant Secretary at its principal office and with the Warrant Agent, an
officer’s certificate setting forth the number of shares of Common Stock
purchasable upon the exercise of the Warrants, the Exercise Price after such
adjustment, a statement, in reasonable detail, of the facts requiring such
adjustment and the computation by which such adjustment was made. Each such
officer’s certificate shall be made available during regular business hours for
inspection by the Holders at the office of the Warrant Agent. 

     

              (h) No Change of Warrant
Necessary. Irrespective of
any adjustment in the Exercise Price or in the number or kind of shares issuable
upon exercise of the Warrants, the Warrant Certificates may continue to express
the same price and number and kind of shares as are stated in the Warrant
Certificates as initially issued. 

     

              (i) Subsequent Adjustments. The adjustment provisions of this Section 11
shall be applied successively and from time to time as the circumstances
requiring such adjustments shall occur. If as a result of an adjustment made
pursuant to this Section 11 (except as otherwise specifically provided herein)
the Holder of any Warrants thereafter surrendered for conversion shall be
entitled to receive any securities other than shares of Common Stock, the number
and kind of the securities issuable upon exercise of the Warrants and the
Exercise Price therefor shall be subject to adjustment, from time to time, in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in this Section 11. 

     

              SECTION 12. Fractional Interests. The Company shall not be required to issue
fractional shares of Common Stock on the exercise of the Warrants. If any
fraction of a share of Common Stock would be issuable upon the exercise of the
Warrants (or any specified portion thereof), the Company shall pay an amount in
cash equal to the product of (x) such fraction and (y) the Daily Market Price of
the Common Stock on the trading day prior to the date the Warrant is exercised.

     

              SECTION 13. Appointment of Warrant
Agent. The Company hereby
appoints the Warrant Agent as its agent to issue the Warrant Certificates, as
set forth herein, subject to resignation or replacement of the Warrant Agent as
provided herein. The Warrant Agent agrees to accept such appointment, subject to
the terms and conditions as set forth herein and to issue, transfer and exchange
the Warrant Certificates pursuant to the terms provided for herein and to notify
the Company to issue or cause to be issued the certificates or other evidence of
ownership representing the appropriate number of shares of Common Stock (or
other consideration) upon exercise of the Warrants.

     

    - 21 - 

     

    

    
    

              SECTION 14. Duties of the Warrant Agent. The Warrant Agent acts hereunder as agent
and in a ministerial capacity for the Company, and its duties shall be
determined solely by the provisions hereof. The Warrant Agent shall not by
issuing and delivering Warrant Certificates, or by any other act hereunder, be
deemed to make any representations (i) as to the validity, value or
authorization of the Warrant Certificates or the Warrants represented thereby or
of any securities or other property delivered upon exercise of any Warrant, or
(ii) whether any stock issued upon exercise of any Warrant is fully paid and
nonassessable. 

     

              Without prejudice to any liability of any
other party hereof, the Warrant Agent shall not at any time be under any duty or
responsibility to any Holder of Warrant Certificates to make or cause to be made
any adjustment of the Warrant Price provided in this Agreement, or to determine
whether any fact exists that may require any such adjustment, or with respect to
the nature or extent of any such adjustment, when made, or with respect to the
method employed in making the same. The Warrant Agent shall not (i) be liable
for any recital or statement of facts contained herein or for any action taken,
suffered or omitted by it in reliance on any Warrant Certificate or other
document or instrument believed by it in good faith to be genuine and to have
been signed or presented by the proper party or parties, (ii) be responsible for
any failure on the part of the Company to comply with any of its covenants and
obligations contained in this Agreement or in any Warrant Certificate, or (iii)
be liable for any act or omission in connection with this Agreement except for
its own gross negligence or willful misconduct. 

     

              Any notice, statement, instruction, request,
direction, order or demand of the Company shall be sufficiently evidenced by an
instrument signed by the Company’s Chairman or Vice Chairman of the Board,
President, any Vice President, its Secretary, or Assistant Secretary (unless
other evidence in respect thereof is herein specifically prescribed). Without
prejudice to any liability of any other party hereof, the Warrant Agent shall
not be liable for any action taken, suffered or omitted by it in accordance with
such notice, statement, instruction, request, direction, order or demand
believed by it to be genuine. 

     

              The Company agrees to pay the Warrant Agent
reasonable compensation for its services hereunder and to reimburse it for its
reasonable expenses hereunder and further agrees to indemnify the Warrant Agent
and save it harmless against any and all losses, expenses and liabilities,
including judgments, costs and counsel fees, for anything done or omitted by the
Warrant Agent in the execution of its duties and powers hereunder except losses,
expenses and liabilities arising as a result of the Warrant Agent’s gross
negligence or willful misconduct. 

     

              The Warrant Agent may resign its duties and be
discharged from all further duties and liabilities hereunder (except liabilities
arising as a result of the Warrant Agent’s own gross negligence or willful
misconduct), after giving thirty days’ prior written notice to the Company. At
least fifteen (15) days prior to the date such resignation is to become
effective, the Warrant Agent shall cause a copy of such notice of resignation to
be mailed to the Holder of each Warrant Certificate at the Company’s expense.
Upon such resignation, or any inability of the Warrant Agent to act as such
hereunder, the Company shall appoint a new warrant agent in writing. The Company
shall have complete discretion in the naming of a new warrant agent, who may be
an affiliate, subsidiary or department of the Company, or any person used by the
Company as transfer agent for the Common Stock. If the Company shall fail to
make such appointment within a period of thirty (30) days after it has been
notified in writing of such resignation by the resigning Warrant Agent, then the
Holder of any Warrant Certificate may apply to any court of competent
jurisdiction for the appointment of a new warrant agent. 

     

    - 22 - 

     

    

    
    

              The Company may, upon notice to the Holders,
remove and replace the Warrant Agent if the Warrant Agent is the transfer agent
for the Company’s Common Stock and the Warrant Agent ceases to be the transfer
agent for the Company’s Common Stock for any reason. 

     

              After acceptance in writing of an appointment
by a new warrant agent is received by the Company, such new warrant agent shall
be vested with the same powers, rights, duties and responsibilities as if it had
been originally named herein as the Warrant Agent, without any further
assurance, conveyance, act or deed. Any former warrant agent hereby agrees to
cooperate with and deliver all records and Warrant Certificates to the new
warrant agent at the direction of the new agent and the Company. 

     

              Any corporation into which the Warrant Agent
or any new warrant agent may be converted or merged or any corporation resulting
from any consolidation to which the Warrant Agent or any new warrant agent shall
be a party or any corporation succeeding to the trust business of the Warrant
Agent shall be a successor warrant agent under this Agreement without any
further act. Any such successor warrant agent shall promptly cause notice of its
succession as warrant agent to be mailed to the Company and to each Holder.

     

              The Warrant Agent shall perform its duties
with all due care and attention. If for any period no person is acting as
Warrant Agent, then the Company shall discharge the obligations that would
otherwise fall to be discharged by the Warrant Agent during such period.

     

              Nothing herein shall preclude the Warrant
Agent from acting in any other capacity for the Company. 

     

              SECTION 15. Notices. Any notice or demand authorized by this
Agreement to be given or made to or on the Company or the Warrant Agent shall be
sufficiently given or made when and if delivered by a recognized international
courier service or hand delivery, or by telecopier with copy sent by first class
or registered mail, postage prepaid, to the applicable address set forth below
(until the Holders are otherwise notified in accordance with this Section by the
Company): 

     

              If to
the Company, then to: 

     

                   Vishay
Precision Group, Inc.
               3
Great Valley Parkway
               Malvern,
PA 19355-1307
               Attn.:
Chief Financial Officer
               Telecopier
No.: (484)-321-5301
               Confirm
No.: (484)-321-5300 

     

    - 23 - 

     

    

    
    

              If to
the Warrant Agent, then to: 

     

                   American
Stock Transfer & Trust Co.,
               59
Maiden Lane
               New
York, NY 10038
               Attn.:
Exchange Department
               Telecopier
No. 718-234-5001
               Confirm
No. 718-921-8200 

     

              Any notice pursuant to this Agreement to be
given to any Holder of any Warrant Certificate shall be sufficiently given when
and if delivered to such Holder at the address appearing on the Warrant Register
of the Company (until the Company and the Warrant Agent are otherwise notified
in accordance with this Section by such Holder). Any such notice shall be
delivered by overnight or hand delivery, by telecopier with copy sent by first
class mail, postage prepaid, or by first class or registered mail, postage
prepaid. 

     

              SECTION 16. Supplements and Amendments. The Company and the Warrant Agent may from
time to time amend or supplement this Agreement in good faith without the
approval of any Holders only in order to cure any ambiguity or to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provision herein. Any other amendment or supplement to this
Agreement shall require the written consent of a Majority of the Warrant
Holders. 

     

              SECTION 17. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of its successors and assigns hereunder; provided, however, that any assignment by the Company shall not
relieve the Company of any of its obligations hereunder. This Agreement shall be
binding upon and inure to the benefit of the successors and registered assigns
of the Initial Holders and all subsequent Holders of Warrants. 

     

              SECTION 18. Governing Law. THIS AGREEMENT AND EACH WARRANT CERTIFICATE
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF SAID STATE. 

     

              SECTION 19. No Third Party
Beneficiaries. Nothing in
this Agreement shall be construed to give to any Person other than the Company,
the Warrant Agent and the Holders of the Warrants or holders of Warrant Shares
any legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company, the
Warrant Agent and the Holders of the Warrants and the holders of Warrant Shares.

     

              SECTION 20. Notification of Delisting. Prior to the occurrence of a Delisting
Event, the Company will, at least ten (10) Business Days before the occurrence
thereof, notify each Holder of such event. Any notice will be in writing and
shall specify the date of such Delisting Event. For these purposes “Delisting Event” means the common stock of the Company being
delisted from the principal United States national or regional securities
exchange or national quotation system on which the shares of common stock are
then listed or traded. 

     

    - 24 - 

     

    

    
    

              SECTION 21. Headings. The descriptive headings of the several
sections and subsections of this Agreement are inserted for convenience only, do
not constitute a part of this Agreement and shall not affect in any way the
meanings or interpretation of this Agreement. 

     

              SECTION 22. Counterparts. This Agreement may be executed in
counterparts and all 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. 

     

    [Signature Page
Follows.] 

     

    - 25 - 

     

    

    
    

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

     

    
      	 	VISHAY PRECISION GROUP,
INC.
	 	 	 
	
            	
            	  
	
            	By:   	 
	
            	
            	Name:   	 	 
	
            	
            	Title:	 	 
	 	 	 
	
            	
            	  
	
            	AMERICAN STOCK TRANSFER & TRUST
      CO.
	 	 	 
	
            	
            	  
	
            	By:	 
	
            	
            	Name:
	
            	
            	Title:

    

    - 26 - 

     

    

    
    

    EXHIBIT A

     

    [Form of Class A Warrant
Certificate]

     

    [Face]

     

    THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN
ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT
FROM SUCH REGISTRATION. *

     

    EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK
CITY TIME ON__________.

     

    
      	No. 	 	 	 	Warrants

    

    Class A Warrant Certificate
Vishay
Precision Group, Inc.

     

              This Warrant Certificate certifies that
_______________, or
registered assigns, is the registered holder (the “Holder”) of ___________ Class A Warrants expiring ____________ (the “Warrants” or “Class A Warrants”) to
purchase Common Stock, $0.10 par value per share (the “Common Stock”), of Vishay
Precision Group, Inc., a Delaware corporation (the “Company”). Each Class A
Warrant entitles the Holder upon exercise to receive from the Company, on or
before 5:00 p.m. New York City Time on ______________ (the
“Expiration Date”), one fully paid and nonassessable share of Common Stock (a
“Warrant Share”) at the initial exercise price (the “Exercise Price”) of
$_____ share (subject to adjustment as provided
herein), payable in lawful money of the United States of America upon surrender
of this Warrant Certificate at the office of the Company designated for such
purpose, but only subject to the conditions set forth herein and in the Warrant
Agreement, as defined below. Capitalized terms not otherwise defined herein
shall have the meaning ascribed to them in the Warrant
Agreement.

     

              This Warrant Certificate and each Class A
Warrant represented hereby are issued pursuant to and are subject in all
respects to the terms and conditions set forth in the Warrant Agreement (the
“Warrant Agreement”), dated __________, 2010 by and between the Company and American
Stock Transfer & Trust Co.(the “Warrant Agent”), which Warrant Agreement is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words “Holder” or “Holders” meaning the registered holder or registered
holders of the Warrants). A copy of the Warrant Agreement may be obtained by the
Holder from the Company at 3 Great Valley Parkway, Malvern, PA 19355-1307 by a
written request from the Holder hereof and may be inspected by the Holder or his
agent at the principal office of the Warrant Agent.

     

    ____________________
 
*
This legend may be removed if such removal is permitted pursuant to the Warrant
Agreement.

     

    - 27 -

     

    

    
    

              This Class A Warrant shall be exercisable at
any time during the period from and after the Issue Date until the Expiration
Date.

     

              The
number of Warrant Shares issuable upon exercise of the Warrants and the Exercise
Price are subject to adjustment upon the occurrence of certain events set forth
in the Warrant Agreement.

     

              No
Warrant may be exercised after 5:00 p.m., New York City time on the Expiration
Date, and to the extent not exercised by such time, such Warrants shall become
void.

     

              The
Holder of Class A Warrants evidenced by this Warrant Certificate may exercise
them by surrendering this Warrant Certificate, with the form of election to
purchase set forth hereon properly completed and executed, together with payment
of the Exercise Price in cash at the office of the Company designated for such
purpose. In the event that upon any exercise of Class A Warrants evidenced
hereby the number of Class A Warrants exercised shall be less than the total
number of Class A Warrants evidenced hereby, there shall be issued to the Holder
hereof or his assignee a new Warrant Certificate evidencing the number of Class
A Warrants not exercised.

     

              The
Warrant Agreement provides that upon the occurrence of certain events the number
of Warrant Shares issuable upon exercise of each Warrant set forth on the face
hereof and the Exercise Price thereof shall be adjusted. No fractions of a share
of Common Stock will be issued upon the exercise of any Class A Warrant, but the
Company will pay the cash value thereof determined as provided in the Warrant
Agreement.

     

              Warrant
Certificates, when surrendered at the office of the Company by the registered
Holder thereof in person or by its legal representative or attorney duly
authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Class A
Warrants.

     

              Upon
due presentation for registration of transfer of this Warrant Certificate at the
office of the Company, a new Warrant Certificate or Warrant Certificates of like
tenor and evidencing in the aggregate a like number of Class A Warrants shall be
issued to the transferee(s) in exchange for this Warrant Certificate, subject to
the limitations provided in the Warrant Agreement, without charge except for any
tax or other governmental charge imposed in connection therewith.

     

              The
Company may deem and treat the registered Holder(s) of this Warrant Certificate
as the absolute owner(s) thereof (notwithstanding any notation of ownership or
other writing hereon made by anyone), for the purpose of any exercise hereof, of
any distribution to the Holder(s) hereof, and for all other purposes, and the
Company shall not be affected by any notice to the contrary. Neither the Class A
Warrants nor this Warrant Certificate entitles any Holder hereof to any rights
of a stockholder of the Company.

     

    - 28 -

     

    

    
    

              IN WITNESS
WHEREOF, Vishay Precision Group, Inc. has caused this Class A Warrant
Certificate to be signed by its President and by its Secretary, each by a
facsimile of his signature, and has caused a facsimile of its corporate seal to
be affixed hereunto or implied hereon.

     

    Dated: _______,
2010

     

    
      	By:	 
	 
	   
	By:	 
	 
	  
	AMERICAN STOCK TRANSFER & TRUST CO.
	 
	  
	By:	 
	Name:
	Title:

    

    - 29 -

     

    

    
    

    ASSIGNMENT FORM

     

              If
you, the Holder, want to assign this Class A Warrant, fill in the form below: I
or we assign and transfer this Class A Warrant to:

     

    
      	 
	 
	 

    

     

    (Print or type name, address and zip code
and
social security or tax ID number of assignee)

     

    and irrevocably appoint _________________________________________
agent to transfer this Class A
Warrant on the books of the Company. The agent may substitute another to act for
him.

     

    
      	Date:   	 	     	Signed:  	 
	 	
            	(Signed
      exactly as your name appears on the
	 	
            	other
      side of this Warrant)

    

              In
connection with any transfer of this Class A Warrant occurring prior to the date
of the declaration by the Securities and Exchange Commission of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the “Securities Act”), covering resales of this Class A Warrant (which
effectiveness shall not have been suspended or terminated at the date of
transfer) at all times when such securities are deemed to be “restricted
securities” within the meaning of the Securities Act, the undersigned confirms
that it has not utilized any general solicitation or general advertising in
connection with the transfer and that this Class A Warrant is being
transferred:

     

    [Check One]

     

    
      	(1)	
            	[ ]	
            	to the Company or a subsidiary thereof;
      or
	 
	(2)	
            	[ ]	
            	pursuant to and in compliance with Rule
      144A under the Securities; or
	 
	(3)	
            	[ ]	
            	to an institutional “accredited
      investor” (as defined in Rule 501(a)(1),(2), (3) or (7) under the
      Securities Act); or
	 
	(4)	
            	[ ]	
            	outside the United States to a person
      who is not a “US person,” in compliance with Rule 904 of Regulation S
      under the Securities Act; or
	 
	(5)	     	[ ]	     	pursuant to the exemption from
      registration provided by Rule 144 under the Securities Act;
      or
	
            	
            	
            	
            	 
	(6)	
            	[ ]	
            	pursuant to another available
      exemption from the registration requirements of the Securities
    Act.

    

     

    - 1 -

     

    

    
    

    Unless one of the boxes is checked, the
Company shall not be obligated to register any of the Class A Warrants evidenced
by this certificate in the name of any person other than the registered Holder
thereof. If box (3), (4), (5) or (6) is checked, the Company may require, upon
the terms described in the Warrant Agreement, prior to registering any such
transfer of the Warrant Certificate, such legal opinions, certifications and
other information as the Company reasonably requests to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities
Act.

     

    
      	Date:   	 	     	Signed:  	 
	 	
            	(Sign
      exactly as your name appears on
	 	
            	the
      other side of this Warrant
Certificate)

    

    - 2 -

     

    

    
    

    ELECTION TO PURCHASE FORM

     

              If
you, the Holder, want to exercise the Class A Warrants represented by this
Certificate, fill in the form below.

     

    I or we, the registered owner of the Class A
Warrants represented by this Certificate irrevocably exercise ________________________________ Class A Warrants for the purchase of
_________________________________
shares or other securities or
property of Common Stock of Vishay Precision Group,
Inc., at the price and on the terms and conditions specified in the Class A
Warrants and request that certificates for the shares of Common Stock hereby
purchased (and any securities or other property issuable or transferable upon
such exercise) be issued in the name of and delivered to:

     

    
      	 
	 
	 

    

     

    (Print or type name, address and zip code
and
social security or tax ID number of owner)

     

    and, if such Class A Warrants shall not
constitute all of the Class A Warrants represented by this Certificate, that a
new Class A Warrant Certificate of like tenor and date for the balance of the
Class A Warrants represented hereby be delivered to the
undersigned.

     

    
      	
            	Number of Class A Warrants
      represented by this Certificate	
            	
            	
            	 	 
	
            	Number of Class A Warrants
      being exercised	
            	
            	
            	 	 
	
            	Balance	
            	
            	
            	 	 
	
            	 	
            	
            	
            
	
            	 	
            	
            	
            
	Date:   	 	     	Signed:  	 
	 	
            	(Signed
      exactly as your name appears on
	 	
            	this
      Warrant)

    

    Note: Each
certificate represents a certain number of Warrants. Each Warrant is exercisable
for one share, subject to adjustment (which may result in exercisability for
other securities on property).

     

    - 1 -

     

    

    
    

    EXHIBIT B

     

    [Form of Class B
Warrant Certificate]

     

    [Face]

     

    THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN
ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT
FROM SUCH REGISTRATION.*

     

    EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK
CITY TIME ON _________.

     

    
      	No. 	          
	 	          
	 Class B
      Warrants

    

     

    Class B Warrant Certificate
Vishay Precision Group,
Inc.

     

              This
Warrant Certificate certifies that _______________, or registered assigns, is the registered
holder (the “Holder”) of ___________ Class B
Warrants expiring ____________
(the “Warrants” or “Class B
Warrants”) to purchase Common Stock, $0.10 par value per share (the “Common
Stock”), of Vishay Precision Group, Inc., a Delaware corporation (the
“Company”). Each Class B Warrant entitles the Holder upon exercise to receive
from the Company, on or before 5:00 p.m. New York City Time on ______________ (the “Expiration Date”), one fully paid and
nonassessable share of Common Stock (a “Warrant Share”) at the initial exercise
price (the “Exercise Price”) of $_____ per share (subject
to adjustment as provided herein), payable in lawful money of the United States
of America upon surrender of this Warrant Certificate at the office of the
Company designated for such purpose, but only subject to the conditions set
forth herein and in the Warrant Agreement, as defined below. Capitalized terms
not otherwise defined herein shall have the meaning ascribed to them in the
Warrant Agreement.

     

              This
Warrant Certificate and each Class B Warrant represented hereby are issued
pursuant to and are subject in all respects to the terms and conditions set
forth in the Warrant Agreement (the “Warrant Agreement”), dated _________, 2010 by and
between the Company and American Stock Transfer & Trust Co.(the “Warrant
Agent”), which Warrant Agreement is hereby incorporated by reference in and made
a part of this instrument and is hereby referred to for a description of the
rights, limitation of rights, obligations, duties and immunities thereunder of
the Company and the Holders (the words “Holder” or “Holders” meaning the
registered holder or registered holders of the Warrants). A copy of the Warrant
Agreement may be obtained by the Holder from the Company at 3 Great Valley
Parkway, Malvern, PA 19355-1307 by a written request from the Holder hereof and
may be inspected by the Holder or his agent at the principal office of the
Warrant Agent.

     

    ____________________
 
*
This legend may be removed if such removal is permitted pursuant to the Warrant
Agreement.

     

    - 2 -

     

    

    
    

              This
Class B Warrant shall be exercisable at any time during the period from and
after the Issue Date until the Expiration Date.

     

              The
number of Warrant Shares issuable upon exercise of the Warrants and the Exercise
Price are subject to adjustment upon the occurrence of certain events set forth
in the Warrant Agreement.

     

              No
Class B Warrant may be exercised after 5:00 p.m., New York City time on the
Expiration Date, and to the extent not exercised by such time, such Class B
Warrants shall become void.

     

              The
Holder of Class B Warrants evidenced by this Warrant Certificate may exercise
them by surrendering this Warrant Certificate, with the form of election to
purchase set forth hereon properly completed and executed, together with payment
of the Exercise Price in cash at the office of the Company designated for such
purpose. In the event that upon any exercise of Class B Warrants evidenced
hereby the number of Class B Warrants exercised shall be less than the total
number of Class B Warrants evidenced hereby, there shall be issued to the Holder
hereof or his assignee a new Warrant Certificate evidencing the number of Class
B Warrants not exercised.

     

              The
Warrant Agreement provides that upon the occurrence of certain events the number
of Warrant Shares issuable upon exercise of each Class B Warrant set forth on
the face hereof and the Exercise Price thereof shall be adjusted. No fractions
of a share of Common Stock will be issued upon the exercise of any Class B
Warrant, but the Company will pay the cash value thereof determined as provided
in the Warrant Agreement.

     

              Warrant
Certificates, when surrendered at the office of the Company by the registered
Holder thereof in person or by its legal representative or attorney duly
authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Class B
Warrants.

     

              Upon
due presentation for registration of transfer of this Warrant Certificate at the
office of the Company, a new Warrant Certificate or Warrant Certificates of like
tenor and evidencing in the aggregate a like number of Class B Warrants shall be
issued to the transferee(s) in exchange for this Warrant Certificate, subject to
the limitations provided in the Warrant Agreement, without charge except for any
tax or other governmental charge imposed in connection therewith.

     

    - 3 -

     

    

    
    

              The Company may deem and treat the registered
Holder(s) of this Warrant Certificate as the absolute owner(s) thereof
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, of any distribution to the
Holder(s) hereof, and for all other purposes, and the Company shall not be
affected by any notice to the contrary. Neither the Class B Warrants nor this
Warrant Certificate entitles any Holder hereof to any rights of a stockholder of
the Company.

     

    - 4
-

     

    

    
    

              IN
WITNESS WHEREOF, Vishay Precision Group, Inc. has caused this Class B Warrant
Certificate to be signed by its President and by its Secretary, each by a
facsimile of his signature, and has caused a facsimile of its corporate seal to
be affixed hereunto or implied hereon.

     

    Dated: _______,
2010

     

    
      	By:	 
	 
	   
	By:	 
	 
	   
	AMERICAN STOCK TRANSFER & TRUST CO.
	 
	  
	By:	 
	Name:
	Title:

    

    - 5 -

     

    

    
    

    ASSIGNMENT FORM

     

              If
you, the Holder, want to assign this Class B Warrant, fill in the form
below:

     

    I or we assign and transfer this Class B Warrant
to:

     

    
      	 
	 
	 

    

     

    (Print or type name, address and zip code
and
social security or tax ID number of assignee)

     

    and irrevocably appoint _________________________________________
agent to transfer this Class B
Warrant on the books of the Company. The agent may substitute another to act for
him.

     

    
      	Date:   	 	     	Signed:  	 
	 	
            	(Signed
      exactly as your name appears on
	 	
            	the
      other side of this Warrant)

    

              In connection with any transfer of
this Class B Warrant occurring prior to the date of the declaration by the
Securities and Exchange Commission of the effectiveness of a registration
statement under the Securities Act of 1933, as amended (the “Securities Act”),
covering resales of this Class B Warrant (which effectiveness shall not have
been suspended or terminated at the date of transfer) at all times when such
securities are deemed to be “restricted securities” within the meaning of the
Securities Act, the undersigned confirms that it has not utilized any general
solicitation or general advertising in connection with the transfer and that
this Class B Warrant is being transferred:

     

    [Check One]

     

    
      	(1)	
            	[ ]	     	to the Company or a subsidiary thereof;
      or
	 
	(2)	
            	[ ]	
            	pursuant to and in compliance with Rule
      144A under the Securities; or
	 
	(3)	
            	[ ]	
            	to an institutional “accredited
      investor” (as defined in Rule 501(a)(1),(2), (3) or (7) under the
      Securities Act); or
	 
	(4)	
            	[ ]	
            	outside the United States to a person
      who is not a “US person,” in compliance with Rule 904 of Regulation S
      under the Securities Act; or
	 
	(5)	     	[ ]	
            	pursuant to the exemption from
      registration provided by Rule 144 under the Securities Act;
      or
	
            	
            	
            	
            	 
	(6)	
            	[ ]	
            	pursuant to another available
      exemption from the registration requirements of the Securities
    Act.

    

     

    - 1 -

     

    

    
    

    Unless one of the boxes is checked, the
Company shall not be obligated to register any of the Class B Warrants evidenced
by this certificate in the name of any person other than the registered Holder
thereof. If box (3), (4), (5) or (6) is checked, the Company may require, upon
the terms described in the Warrant Agreement, prior to registering any such
transfer of the Warrant Certificate, such legal opinions, certifications and
other information as the Company reasonably requests to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities
Act.

     

    
      	Date:   	 	     	Signed:  	 
	 	
            	(Sign
      exactly as your name appears on
	 	
            	the
      other side of this Warrant
Certificate)

    

    - 2 -

     

    

    
    

    ELECTION TO PURCHASE FORM

     

              If
you, the Holder, want to exercise the Class B Warrants represented by this
Certificate, fill in the form below.

     

    I or we, the registered owner of the Class B
Warrants represented by this Certificate irrevocably exercise ________________________________ Class B Warrants for the purchase of
_________________________________
shares or other securities or
property of Common Stock of Vishay Precision Group,
Inc., at the price and on the terms and conditions specified in the Class B
Warrants and request that certificates for the shares of Common Stock hereby
purchased (and any securities or other property issuable or transferable upon
such exercise) be issued in the name of and delivered to:

     

    
      	 
	 
	 

    

     

    (Print or type name, address and zip code
and
social security or tax ID number of owner)

     

    and, if such Class B Warrants shall not
constitute all of the Class B Warrants represented by this Certificate, that a
new Class B Warrant Certificate of like tenor and date for the balance of the
Class A Warrants represented hereby be delivered to the
undersigned.

     

    
      	
            	Number of Class B Warrants
      represented by this Certificate	
            	
            	
            	 	 
	
            	Number of Class B Warrants
      being exercised	
            	
            	
            	 	 
	
            	Balance	
            	
            	
            	 	 
	
            	 	
            	
            	
            
	
            	 	
            	
            	
            
	Date:   	 	     	Signed:  	 
	 	
            	(Signed
      exactly as your name appears on
	 	 	this
  Warrant)

    

     

    Note: Each
certificate represents a certain number of Warrants. Each Warrant is exercisable
for one share, subject to adjustment (which may result in exercisability for
other securities on property).

     

    - 1 -exhibit10-12.htm

    _______________,
2010

     

     

     

     

     

     

     

     

     

    VISHAY PRECISION GROUP, INC.
(as
Issuer)

     

     

     

     

     

    
      	  
	FORM OF NOTE
      INSTRUMENT
	constituting
	up to $____________
	FLOATING
    RATE
	UNSECURED LOAN NOTES
      2102
	  
	   

    

     

     

     

     

     

     

     

     

     

    

    
    

    THIS
INSTRUMENT is made on the
____ day of ________ 2010 by VISHAY PRECISION GROUP, INC. a company
incorporated in the State of Delaware USA, (the Company).

     

    Whereas

     

    
      	(A)	
            	Vishay
      Intertechnology issued loan notes (the “Vishay Intertechnology Loan
      Notes”) pursuant to that certain Note Instrument dated as of
      December 13, 2002 (the “Vishay Intertechnology Note
      Instrument”); and
	 
	(B)	
            	Vishay
      Intertechnology, American Stock Transfer & Trust Co. and the holders
      of the Vishay Intertechnology Loan Notes entered into that certain Put and
      Call Agreement, dated as of December 13, 2002 (the “Vishay Intertechnology Put and Call
      Agreement”); and
	 
	(C)	
            	Pursuant to the Vishay Intertechnology Put and Call Agreement,
      Vishay Intertechnology agreed that in case it shall at any time pay a
      dividend or make a distribution to all holders of its common stock
      consisting of the capital stock of any class or series, or similar
      interests, of or relating to a subsidiary or other business entity of
      Vishay Intertechnology, then Vishay Intertechnology shall take such action
      and shall cause the subsidiary or other business entity whose capital
      stock was paid as a dividend or distributed by Vishay Intertechnology to
      take such action so that each of the loan notes issued pursuant to the
      Vishay Intertechnology Note Instrument shall be deemed exchanged as of the
      effective date of such transaction, for a combination of new floating rate
      unsecured Vishay Intertechnology loan notes and floating rate unsecured
      loan notes of the subsidiary or other business entity whose capital stock
      was paid as a dividend or distributed by Vishay Intertechnology;
      and
	 
	(D)	
            	Vishay
      Intertechnology and the Company entered into that certain Master
      Separation Agreement, dated as of _______, 2010 (the
      “Master Separation Agreement”),
      providing for the spin-off of the Company by Vishay Intertechnology in the
      form of a tax free dividend of the common stock of the Company to the
      holders of the common stock of Vishay Intertechnology and the class B
      common stock of the Company to the holders of class B common stock of
      Vishay Intertechnology; and
	 
	(E)	
            	The
      Company has agreed under the terms of the Master Separation Agreement to
      comply with the obligation under the Vishay Intertechnology Put and Call
      Agreement to issue floating rate unsecured loan notes to the holders of
      the Vishay Intertechnology Loan Notes; and
	 
	(F)	     	Accordingly, the Company has created up to $____________ Floating Rate Unsecured Loan Notes 2102
      and has determined to constitute the said Loan Notes as hereinafter
      provided.

    

     

    Now This Instrument Witnesses And The Company Hereby Declares as
follows:-

     

    1. In this Instrument and in the Schedules
hereto the following expressions shall, where the context permits, have the
following meanings:

     

    the Conditions means the conditions
to be endorsed on the Loan Notes in the form or substantially in the form set
out in Schedule 2 hereto as the same may from time to time be modified in
accordance with the provisions herein contained;

     

    

    
    

    Directors
means
the Board of Directors for the time being of the Company or a duly authorised
committee of the Board of Directors;

     

    Exchange Act
means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder, as the same may be amended from time to
time;

     

    Instrument
means
this instrument and the Schedules hereto as from time to time modified in
accordance with the provisions herein
contained;

     

    LIBOR means, in
relation to any amount owed by the Company hereunder and any interest
period:

     

    
      	(a)	
            	the
      percentage rate per annum equal to the offered quotation which appears on
      the page of the Telerate Screen which displays an average British Bankers
      Association Interest Settlement Rate for US Dollars for such period at or
      about 11.00 a.m. (London time) on the first day of the relevant interest
      period; or
	 
	(b)	     	if a
      rate is not available pursuant to (a) above, the percentage rate per annum
      which is the arithmetic mean of the rates as supplied to the Company at
      its request quoted by three banks selected by the Company (one of which
      shall include, if in existence at the time, Barclays Bank plc) to leading
      banks in the London inter-bank market for three month deposits of similar
      size and currency.

    

     

    Loan Notes
means
up to $____________ Floating Rate Unsecured Loan Notes 2102 of the
Company to be issued under this Instrument or (as the context may require) the
principal amount thereof for the time being issued and
outstanding;

     

    Noteholders means the several persons for the
time being entered in the Register;

     

    Put and Call Agreement means the put and call agreement
relating to the Loan Notes entered into by the Company and other persons in
connection with the transaction contemplated by the Master Separation Agreement
on or about the date hereof;

     

    Register means the register of Noteholders
referred to in clause 8 hereof;

     

    Registration Rights Agreement
means the registration
rights agreement entered into by Vishay Intertechnology and other persons in
connection with the SPA on or about December 13,
2002;

     

    SPA means the share sale and purchase
agreement entered into by Vishay Intertechnology as purchaser and other persons
on or about December 13, 2002 pursuant to which the Vishay Intertechnology Loan
Notes were issued; and

     

    Vishay Precision Group means the Company (including its
successors) and its subsidiaries from time to
time.

     

    2

     

    

    
    

    Words denoting the singular number only shall
include the plural number and vice versa. Words denoting persons shall include
corporations.

     

    2. The Loan Notes shall be known as the Vishay
Precision Group, Inc. Floating Rate Unsecured
Loan Notes 2102 and shall be issued in amounts and multiples of $1000 by the
Company to such persons at such times and on such terms as the Directors may
determine.

     

    3. The aggregate principal amount of the Loan
Notes is limited to $_________. The Loan Notes, as and
when issued, and all accrued and unpaid interest thereon, shall (except as
regards the first payment of interest) rank pari passu equally and rateably
without discrimination or preference as an unsecured debt obligation of the
Company.

     

    4. As and when the Loan Notes or any part
thereof fall to be redeemed or repaid in accordance with the provisions hereof,
the Company will pay to the Noteholders entitled thereto the principal amount of
the Loan Notes to be repaid together with accrued interest (subject to any
requirement to deduct any income tax therefrom).

     

    5. Until such time as the Loan Notes are
redeemed or repaid in accordance with the provisions hereof, the Company will
pay to the Noteholders interest (subject to any requirement to deduct any income
tax therefrom) on the principal amount of the Loan Notes outstanding at the
rates and the times and as otherwise provided in the
Conditions.

     

    6. Every Noteholder shall be entitled without
charge to one certificate for the Loan Notes held by it. However, joint holders
of Loan Notes will be entitled only to one Loan Note certificate (provided that
the Company shall not be bound to register more than four persons as the joint
holders of any Loan Note) and such Loan Note will be sent to that one of the
joint holders who is first named in the Register. Every Loan Note certificate
shall be issued under the common or securities seal of the Company and shall be
substantially in the form set out in Schedule 1 hereto and shall have the
Conditions endorsed thereon. The Company shall comply with the provisions of the
Loan Notes and the Conditions and the Loan Notes shall be held subject to all
such provisions which shall be binding on the Company and the Noteholders and
all persons claiming through or under them respectively.

     

    7. Each Noteholder shall be entitled to
require all or any part (being $1000 nominal amount or any integral multiple
thereof) of the Loan Notes held by it to be repaid at par together with accrued
interest (subject to any requirement to deduct any income tax therefrom)
if:

     

    
      	(a)	
            	
              any principal or interest on any of the
      Loan Notes held by that Noteholder due to it shall fail to be paid in full
      within thirty days after receipt of written demand by the Company,
      addressed to its financial controller (with a copy to ___________ of _____________) and made by the relevant Noteholder
      following failure to pay; or

            
	  
	(b)	     	
              the Company breaches any of its
      obligations to issue shares or, if applicable, to pay cash under the Put
      and Call Agreement and such breach, if capable of remedy, is not remedied
      within ten days after written notification to the Company addressed to its
      financial controller (with a copy to _____________ of ___________________________);
or

            

    

     

    3

     

    

    
    

    
      	(c)	
            	
              any indebtedness of any member or members of the Vishay Precision
      Group having in aggregate a principal amount in excess of US$50,000,000 is
      not paid on its due date or within any applicable grace period, and such
      default in payment is not waived or remedied within a period of one month;
      or

            
	 
	(d)	
            	the Company pursuant to or under
      or within the meaning of any Bankruptcy Law:
	 
	 	
            	(i)	
            	commences a voluntary case or
      proceeding;
	 
	 	
            	(ii)	
            	consents to the entry of an order
      for relief against it in an involuntary case or proceeding or the
      commencement of any case against it;
	 
	 	
            	(iii)	
            	consents to the appointment of a
      Custodian of it or for any substantial part of its
    property;
	 
	 	
            	(iv)	
            	makes a general assignment for the
      benefit of its creditors;
	 
	 	
            	(v)	
            	files a petition in bankruptcy or
      answer or consent seeking reorganization or relief; or
	 
	 	
            	(vi)	
            	consents to the filing of such
      petition or the appointment of or taking possession by a Custodian;
      or
	 
	(e)	
            	a court of competent jurisdiction
      enters an order or decree under any Bankruptcy Law
  that:
	 
	 	
            	(i)	
            	is for relief against the Company
      in an involuntary case or proceeding, or adjudicates the Company insolvent
      or bankrupt;
	 
	 	
            	(ii)	
            	appoints a Custodian of the
      Company for any substantial part of its property; or
	 
	 	
            	(iii)	     	orders the winding up or
      liquidation of the Company; and the order or decree remains unstayed and
      in effect for 60 days; or
	 
	(f)	     	any event analogous to (d) or (e)
      above occurs in any jurisdiction.

    

     

    In paragraphs
(d) and (e) above:

     

    Bankruptcy Law means Title 11, United States
Code, or any similar Federal or state law for the relief of
debtors.

     

    Custodian means any receiver, trustee,
assignee, liquidator, custodian or similar official under any Bankruptcy
Law.

     

    The Company
shall notify each of the Noteholders forthwith on the occurrence of any of the
events described in sub-clause (a) to (f) of this clause 7.

     

    4

     

    

    
    

    8. A register of the Noteholders will be kept
at 3 Great Valley Parkway, Malvern, Pennsylvania 19355-1307 (or at such other place as the Company may from
time to time have appointed for the purpose and have notified to
the Noteholders) and there shall be entered in the Register:

     

    
      	(a)	
            	the
      names and addresses of the Noteholders;
	 
	(b)	
            	the telecopier numbers of the
      Noteholders;
	 
	(c)	
            	the
      principal amount of the Loan Notes held by each
    Noteholder;
	 
	(d)	
            	the
      date on which the name of each Noteholder is entered in respect of the
      Loan Notes standing in its name; and
	 
	(e)	     	the
      serial number of each Loan Note.

    

     

    9. Any change of name or address on the part
of any Noteholder which is notified to the Company at
the address set out in clause 8 above shall be entered in the
Register.

     

    10. Any Noteholder may at all reasonable times
during office hours inspect the Register.

     

    11. The Company hereby covenants with the
Noteholders and each of them duly to perform and observe the obligations herein
contained and imposed on it to the intent that these presents shall enure for
the benefit of all Noteholders, each of whom may sue for the performance or
observance of the provisions hereof so far as its holding of Loan Notes is
concerned.

     

    12. The Conditions and provisions contained in
the Schedules hereto shall have effect in the same manner as if such Conditions
and provisions were herein set forth.

     

    13. A memorandum of execution of any
instrument supplemental to this Instrument shall be endorsed by the Company on
this Instrument.

     

    14. This Instrument and the Loan Notes shall
be governed by and construed in accordance with the laws of the State of New
York.

     

    15. Each of the parties agrees that the courts
of the State of New York are to have exclusive jurisdiction to settle any
disputes that may arise in connection with this Agreement.

     

    In Witness Whereof this
Instrument has been duly executed by the Company the day and year first above
written.

     

    The
Company

     

    VISHAY PRECISION GROUP,
Inc.

     

     

    
      	By:	   	  
	 	
            	Name:	   	 	 
	 	
            	Title:	
            	 	  

    

    5

     

    

    
    

    SCHEDULE
1

     

    Form of Loan
Note

     

    No.
_____ Amount $_____

     

    VISHAY
PRECISION GROUP, INC.

     

    (Incorporated
in the State of Delaware)

     

    UP TO
$_____________ VISHAY PRECISION GROUP, INC. FLOATING
RATE
UNSECURED LOAN NOTES 2102

     

    THIS IS TO CERTIFY THAT _____ _____ is/are the
registered holder(s) of the above principal amount of the Vishay Precision
Group, Inc. Unsecured Loan Notes 2102 (the Loan Notes) constituted by an
Instrument entered into by the Company on _________, 2010 (together
with any instruments supplemental thereto) (the Instrument) and issued with the benefit
of, and subject to the provisions contained in, the Instrument and the
Conditions endorsed hereon. The Loan Notes further take the benefit of certain
representations and warranties contained in the Note Purchase Agreement referred
to in the Instrument as if made by Company as of ____, 2010, to the extent
relating to the Instrument and the Loan Notes.

     

    Interest is payable on the Loan Notes
quarterly in arrears on the interest payment dates in each year and at a
floating rate determined in accordance with the Conditions endorsed
hereon.

     

    The Loan Notes are redeemable in accordance
with Condition 8 endorsed hereon.

     

    The Loan Notes are transferable on the terms
set out in the Conditions endorsed hereon. This Loan Note certificate must be
surrendered before any transfer can be registered or any new Loan Note
certificate can be issued in exchange.

     

    The Loan Notes have not been, and will not be,
registered under the United States Securities Act of 1933, as amended and,
accordingly, certain restrictions on ownership and transfer apply to the Loan
Notes.1

     

    Copies of the Instrument constituting the Loan
Notes are available for inspection at the registered office of the
Company.

     

    The Loan Notes shall be governed by and
construed in accordance with the laws of the State of New
York.

     

    IN WITNESS
whereof Vishay Precision
Group, Inc. has executed this Loan Note
Certificate.

     

    ____________________

     

    
      	1	     	
              The provisions of the Registration
      Rights Agreement dated as of December 13, 2002 made between Vishay
      Intertechnology and the Original Holders (as such term is defined in the
      Registration Rights Agreement) shall govern whether or not legends in
      compliance with the United States Securities Act of 1933 appear on the
      face of the Loan Note certificates.

            

    

     

    1

     

    

    
    

    [EXECUTION
BLOCK FOR COMPANY]

     

    Issued on [ ]
20[__]

     

     

     

    2

     

    

    
    

    SCHEDULE
2

     

    The
Conditions

     

    1. The Loan Notes are issued in amounts and
multiples of $1000 and constitute unsecured obligations of the
Company.

     

    2. Interest on the Loan Notes will be
calculated on the basis of a 360 day year and will be payable (subject to any
requirement to deduct any income tax therefrom) by quarterly instalments in
arrears on 31 March, 30 June, 30 September and 31 December in each year (or if
such day is not a business day in New York and Frankfurt, on the immediately
preceding common business day in such cities) (interest payment dates) in
respect of the preceding interest period (as defined below) ending on the
interest payment date at a rate calculated for each interest period as provided
in Condition 3 below, except that the first interest payment on the Loan Notes,
which shall be made on _________, 2010 will be in respect of the period from
(and including) the first date of issue of any of the Loan Notes to (but
excluding) __________, 2010. The period from (and including) the
first date of issue of any Loan Notes to (but excluding) ___________ 2010 and the period from (and including)
___________ 2010 or any subsequent quarter date (where
quarter date means any of 31
March, 30 June, 30 September or 31 December) to (but excluding) the next
following quarter date is herein called an interest
period.

     

    3. (a) Subject to Condition 3(b), the rate of
interest on the Loan Notes for any interest period will be LIBOR for such
interest period.

     

    (b) If at any time during the period beginning
on the date of issue of the Loan Notes and ending on 31 December 2010, the
Common Stock has a Market Value of equal to or more than the Target Price per
share for 30 or more consecutive trading days, then the rate of interest on the
Loan Notes for all interest periods commencing on or after 1 January 2011 will
be the rate per annum equal to fifty per cent. (50%) of LIBOR for such interest
period.

     

    In this Condition 3:

     

    Common Stock means the common stock, par value US$0.10, of the
Company and any other security exchanged or substituted for such common stock or
into which such common stock is converted in any recapitalization,
reorganization, merger, consolidation, share exchange or other business
combination transaction, including any reclassification consisting of a change
in par value or a change from par value to no par value or vice
versa;

     

    Majority of the Noteholders
means, at any relevant time, the
Noteholders of a majority of the principal amount of the Loan Notes that are at
any relevant time outstanding;

     

    Market Value for any trading day means the volume-weighted average
of the per share selling prices on the New York Stock Exchange or other
principal United States securities exchange or inter-dealer quotation system on
which the Common Stock is then listed or quoted (or, if there is no sale of the
Common Stock reported on such trading day, the average of the low ask and high
bid price for the Common Stock reported on the last trading day in which such
sale was reported) or, if there are no high bid and low ask prices, the Market
Value shall be the per share fair market value of the Common Stock or other
security as determined by an investment banking firm of national reputation and
standing selected by the Company and reasonably acceptable to the Majority of
the Noteholders;

     

    3

     

    

    
    

    Target Price means $_____
per share of Common Stock,
provided that if any event(s) described in Article IV of the Put and Call
Agreement shall occur, then the Target Price shall be subject to adjustment in
the manner and to the extent applicable to the Target Price (as defined in the
Put and Call Agreement);

     

    trading day means any day on which securities are traded or
quoted on the principal securities exchange or interdealer quotation system on
which the Common Stock is listed for trading or quotation;
and

     

    Securities Act means the United States Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder, as the same may
be amended from time to time.

     

    4. If the Company fails to pay any amount
payable by it under this Instrument or the Loan Notes, it
must immediately on demand by the relevant Noteholder pay interest on the
overdue amount from its due date up to the date of actual payment, both before,
on and after judgement at the rate per annum equal to the Relevant Rate plus one per cent.
(1%). For these purposes the Relevant Rate is the rate for the time being
applicable pursuant to Condition 3 above.

     

    5. Each interest payment shall be made
(subject to any requirement to deduct any income tax therefrom) to the
Noteholder on the register of Noteholders at the close of business on the
twenty-eighth day preceding the date for payment of such interest and every such
Noteholder shall be deemed, for the purpose of these presents, to be the holder
on such interest payment date of the Notes held by it on such preceding date
notwithstanding any intermediate transfer or transmission of any such
Notes.

     

    6. In circumstances where the Company is
required (or would in the absence of any relevant filing be required) to make a
deduction or withholding for or on account of any taxes or any other deductions,
(and where any Noteholder is entitled to a reduced rate of withholding), the
Company shall (to the extent it is entitled or required to do so) co-operate in
a timely manner in filing such forms and documents as the Internal Revenue
Service and any other taxation authority may require in order to enable the
Company to make relevant payments under the Loan Notes without having to make
such deduction or withholding, or at the relevant reduced rate of
withholding.

     

    7.1 If the Company at any time is subject to a
transaction pursuant to which it becomes a subsidiary of any other person, it
will thereafter procure that its ultimate parent company from time to time, as
soon as practicable after becoming such, provides the Noteholders with a
binding, irrevocable and unconditional guarantee of all of the obligations of
the Company in respect of the Notes, the Registration Rights Agreement and the
Put and Call Agreement in customary form.

     

    7.2 If the Company ceases to be a reporting
company under Section 13(d) or 15 of the Exchange Act (a Reporting Entity), then, for so
long as it does not have a holding company that has issued a guarantee to the
Noteholders as required by Condition 7.1, it will in respect of each of its
financial quarters provide each Noteholder promptly after the same is prepared
with such quarterly and annual financial statements as it prepares in the
ordinary course in respect of itself and its subsidiaries and as is of the type
customarily provided to bank creditors.

     

    4

     

    

    
    

    7.3 If a guarantee of a holding company is in
effect as contemplated by Condition 7.1 above but the relevant guarantor is not
a Reporting Entity, then the Company shall be obliged to procure that the
relevant guarantor for the time being provides to each Noteholder the
information referred to in Condition 7.2 above in respect of itself and its
subsidiaries within the timeframe contemplated by that
Condition.

     

    8. Each Noteholder shall be entitled to
require all or any part (being $1000 nominal amount or any integral multiple
thereof) of the Loan Notes held by it to be repaid at par together with accrued
interest (subject to any requirement to deduct any income tax therefrom) up to
(but excluding the date of repayment) in the circumstances specified in clause 7
of the Instrument. Unless previously repaid, redeemed or purchased and
cancelled, the Company will redeem the Loan Notes on 31 December, 2102 at par
together with accrued interest (subject to any requirement to deduct income tax
therefrom) up to (but excluding) the date of repayment.

     

    9. Any Loan Notes repaid, redeemed or
purchased pursuant to Condition 8 shall forthwith be cancelled and the Company
shall not be at liberty to reissue the same.

     

    10. Every Noteholder any of whose Loan Notes
is due to be repaid or redeemed under these Conditions shall, not later than the
due date for such repayment or redemption, deliver up to the Company, at the
address specified in clause 8 of the Instrument constituting the Loan Notes, the
Loan Notes which are due to be repaid or redeemed in order that the same may be
cancelled. Upon such delivery and against a receipt for the principal moneys
payable in respect of the Loan Notes to be repaid or redeemed, the Company shall
pay to the Noteholder the amount payable to it in respect of such repayment or
redemption.

     

    11. Interest shall cease to accrue on any Loan
Notes becoming liable to repayment or redemption as from the due date for
repayment or redemption of such Loan Notes, unless (upon the Noteholder
demanding on or after such date and at the address specified in clause 8 of the
Instrument payment of the principal moneys payable in respect thereof and
tendering the certificate(s) therefor and a receipt for such moneys duly signed
and authenticated in such manner as the Company may reasonably require) payment
of such moneys shall not be made by the Company, in which case interest will
accrue from the date of such demand until (but excluding) the date of payment by
the Company.

     

    12. Amounts in respect of interest on any Loan
Notes which remain unclaimed by the Noteholder for a period of five years and
amounts due in respect of principal which remain unclaimed for a period of ten
years, in each case from the date on which the relevant payment first becomes
due, shall revert to the Company and the Noteholder shall cease to be entitled
thereto.

     

    13. Any Notes acquired by or on behalf of any
member of the Vishay Precision Group shall be automatically
cancelled.

     

    14. The provisions of the Instrument
constituting the Loan Notes and the rights of the Noteholders are subject to
modification, abrogation or compromise in any respect but only in accordance
with the provisions of Schedule 4 of the said Instrument and with the consent of
the Company.

     

    5

     

    

    
    

    15. The Loan
Notes are in registered form, and are transferable in accordance with the
provisions of Schedule 3 of the Instrument.

     

    16. All Loan
Notes shall form a single series and shall rank pari passu equally and rateably
without discrimination or preference as an unsecured debt obligation of the
Company.

     

    17. No
application has been or is intended to be made to any stock exchange for the
Loan Notes to be listed or dealt in.

     

    18. Any notice
or other document (including a Loan Note certificate) to be given to a
Noteholder may be given or sent to the Noteholder at its registered address for
the giving of notice to it by a method permitted pursuant to Condition 19. In
the case of joint registered holders of any Loan Notes, a notice given to the
Noteholder whose name stands first in the register in respect of such Loan Notes
shall be sufficient notice to all joint holders. Notice may be given to the
persons entitled to any Loan Notes in consequence of the bankruptcy of any
Noteholder by sending the same by a method permitted pursuant to Condition 19
addressed to them by name or by the title of the representative or trustee of
such holder at the address (if any) in the United Kingdom supplied for the
purpose by such persons or (until such address is supplied) by giving notice in
the manner in which it would have been given if the bankruptcy had not
occurred.

     

    19. Any notice
required to be given to the Company under the Instrument shall be sent in
writing to the address specified in clause 8 of the Instrument and shall be
sufficiently given or made when and if delivered by a recognized international
courier service or hand delivery, or by telecopier with in each case a copy sent
by first class or registered mail, post prepaid.

     

    20. Words and
expressions defined in the Instrument shall have the same respective meanings
whenever used in these Conditions.

     

    6

     

    

    
    

    SCHEDULE
3

     

    Provisions as
to Registration, Transfer and Other Matters

     

    1. Except as required by law or as ordered by
a court of competent jurisdiction, the Company will
recognise the registered holder of any Loan Notes as the absolute owner thereof
and shall not be bound to take notice or see to the execution of any trust,
whether express, implied or constructive, to which any Loan Notes may be
subject. The receipt of the registered holder for the time being of any Loan
Notes or, in the case of joint registered holders, the receipt of any of them
for the interest from time to time accruing due in respect thereof or any other
moneys payable in respect thereof shall be a good discharge to the Company,
notwithstanding any notice it may have, whether express or otherwise, of the
right, title, interest or claim of any other person to or in such Loan Notes,
interest or moneys. The Company shall not be bound to enter notice of any trust,
whether express, implied or constructive, on the register in respect of any Loan
Notes.

     

    2. Every Noteholder will be recognised by the
Company as entitled to its Loan Notes free from any equity, set-off or
counter-claim on the part of the Company against the original or any
intermediate holder of the Loan Notes.

     

    3. The Loan Notes are
transferable:

     

    
      	(a)	
            	
              in whole or in part (but in the case of
      a transfer of part in a minimum principal amount of at least $2,000,000
      and such that the transferor’s holding of Loan Notes after such transfer
      would not be less than $2,000,000) (and for these purposes a transfer of
      less than $2,000,000 shall not be a transfer in whole if it does not
      relate to all of the Loan Notes held by a transferor and its
      affiliates);

            
	 
      
	(b)	
            	
              subject to compliance with the
      restrictions set out in Schedule 6; and

            
	 
	(c)	     	
              in whole or in part to any affiliate of
      a Noteholder provided that, in the case of a transfer in part, the
      transferor and the transferee have entered into such documentation as the
      Company may reasonably require to provide that:

            
	 
      
	 	
            	(i)	
            	
              one member of the transferor’s group
      shall act as administrative agent for all Noteholders who are members of
      such group, with the effect that the Company will only be required to deal
      with one member of the transferor’s group in relation to the Loan Notes;
      and

            
	  
	 	
            	(ii)	     	
              if the transferee ceases to be an
      affiliate of the transferor, the Company will be notified and able to
      require the relevant Loan Notes promptly to be transferred back to the
      transferor.

            

    

     

    For these purposes, an affiliate of any person is (i)
any other person that is a holding company or subsidiary of the first, or a
subsidiary of any such holding company; (ii) in the case of a transferor that is
a fund management company, investment company, or venture capital or private
equity company, any fund, limited partnership or similar entity that is advised
or managed by that transferor; and (iii) in the case of a transferor that is a
fund, limited partnership or similar entity, any other such entity that is under
common management with the transferor.

     

    7

     

    

    
    

    No assignment, transfer, sale or other
disposal of any holding of Loan Notes will be registered except in accordance
with paragraphs 4 and 5 below.

     

    4. Every instrument of transfer shall be
substantially in the form set out in Schedule 5 and must be signed by the
transferor and the transferor shall be deemed to remain the owner of the Loan
Notes to be transferred until the name of the transferee is entered in the
register in respect thereof and until the transferee shall have executed an
assignment substantially in the form set out in Annex I to the Put and Call
Agreement.

     

    5. Every instrument of transfer must be left
for registration with the Company at the address specified in clause 8 of the
Instrument accompanied by the certificate for the Loan Notes to be transferred
together with any certificates required and such other evidence as the Directors
may require to prove the title of the transferor or its right to transfer the
Loan Notes, and, if the instrument of transfer is executed by some other person
on its behalf, the authority of that person to do so. The transfer will then
(subject to paragraphs 3 and 4 above) be registered and a note of such
registration will be entered in the Register and a new certificate for Loan
Notes issued accordingly.

     

    6. All instruments of transfer that are
registered shall be retained by the Company.

     

    7. No fee shall be charged for the
registration of any transfer or other document relating to or affecting the
title to any Loan Notes.

     

    8. Any person becoming entitled to Loan Notes
in consequence of the bankruptcy of a holder of Loan Notes or of any other event
giving rise to the transmission of such Loan Notes by operation of law may, upon
producing such evidence that it sustains the character in respect of which it
proposes to act under this Condition or of its title as the Company shall think
sufficient be registered itself as the holder of such Loan
Notes.

     

    9. The interest or other moneys payable in
respect of the Loan Notes and the principal amount of the Loan Notes or any part
thereof may be paid by electronic transfer to the bank account notified for such
purpose by the relevant Noteholder to the Company no less than 14 days prior to
the relevant date for payment; or if no such account is so satisfied, by cheque
sent through the post at the risk of the holder or holders to the registered
address of the holder or, in the case of joint registered holders, to the
registered address of that one of the joint registered holders who is first
named on the register in respect of such holding, or to such person and to such
address as the registered holder or the joint registered holders may in writing
direct. Every such cheque shall be made payable to the order of the person to
whom it is sent and payment of the cheque shall be a satisfaction of the moneys
represented thereby.

     

    10. If any Loan Note certificate is defaced,
lost or destroyed, it may be replaced on such terms (if any) as to evidence and
indemnity as the Company may require but so that, in the case of defacement, the
defaced Loan Note certificate shall be surrendered before the new Loan Note
certificate is issued.

     

    8

     

    

    
    

    SCHEDULE 4

     

    Amendments, Supplements and
Waivers

     

    Except as
described below the Company may amend the terms of the Loan Notes with the
written consent of Noteholders holding 66% of the aggregate principal amount of
the then outstanding Loan Notes. Noteholders holding a 66% of the aggregate
principal amount of the outstanding Loan Notes may waive compliance by the
Company with any provision of the Loan Notes. However, without the consent of
each affected Noteholder, an amendment, supplement or waiver may
not:

     

    
      	(a)	
            	change the maturity of the
      principal of or any instalment of interest on any Loan Note in a manner
      adverse to the Noteholders;
	 
	(b)	
            	reduce the principal amount of any
      Loan Note;
	 
	(c)	
            	reduce the rate of or extend the
      time for payment of interest on any Loan Note;
	 
	(d)	
            	change the place or currency of
      payment of principal of or interest on any Loan Note;
	 
	(e)	
            	modify any provision of the Loan
      Notes relating to the waiver of past defaults or the right of the
      Noteholders to institute suit for the enforcement of any payment on or
      with respect to any Loan Notes or the modification and amendment
      provisions of the Loan Notes;
	 
	(f)	
            	reduce the percentage of the
      principal amount of outstanding Loan Notes necessary for amendment to or
      waiver of compliance with any provision of the Loan Notes or for waiver of
      any breach of the terms thereof;
	 
	(g)	
            	waive a default in the payment of
      principal of, interest on, or redemption payment with respect to, the Loan
      Notes;
	 
	(h)	     	modify the ranking or priority of
      any Loan Note in any manner adverse to the
  Noteholders;

    

     

    It shall not be
necessary for the consent of the Noteholders under this Schedule 4 to approve
the particular form of any proposed amendment, supplement or waiver, but it
shall be sufficient if such consent approves the substance
thereof.

     

    After an
amendment, supplement or waiver under this Schedule 4 becomes effective, the
Company shall notify the Noteholders affected thereby with a notice briefly
describing the amendment; supplement or waiver. Any failure by the Company to
send such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such amendment, supplement or
waiver.

     

    9

     

    

    
    

    SCHEDULE
5

     

    Form of
Transfer Certificate

     

    To: Vishay Precision Group, Inc. (the
Company)

     

    TRANSFER
CERTIFICATE

     

    This Transfer Certificate relates to the
Instrument constituting up to $_____________ Vishay
Precision Group, Inc. Floating Rate Loan Notes 2102 dated ____________, 2010 of Vishay Precision Group, Inc. (the
Instrument). Capitalised terms
defined in the Instrument shall have, unless otherwise defined in this Transfer
Certificate, the same meanings when used in this Transfer
Certificate.

     

    1. [Transferor] (the Transferring Holder) confirms
that the principal outstanding amount of Notes that it holds is
$[_____] (the Transferring Holder’s
Notes).

     

    2. The Transferring Holder
requests:

     

    
      	(a)	
            	[___________]
      [Transferee] (the Transferee) to accept and
      procure the transfer to the Transferee of [the Transferring Holder’s
      Notes//[_____] principal amount of the Transferring
      Holder’s Notes, being a principal amount greater than $2,000,000] as
      further specified in the Appendix (the Transfer Notes) by
      countersigning and delivering this Transfer Certificate to the Company at
      its address for the service of notices specified in the Instrument;
      [and
	 
	(b)	     	the
      Company to issue a certificate in its name in relation to that portion of
      the Transferring Holder’s Notes not comprising the Transfer Notes (the
      Retained Notes) in
      accordance with clause 6 of the Instrument. For the avoidance of doubt,
      the Transferor acknowledges that this Transfer Certificate shall not
      affect its rights, undertakings, liabilities and obligations in respect of
      the Retained Notes.]

    

     

    3. The Transferring Holder makes no
representation or warranty and assumes no responsibility with respect to the
legality, validity, effectiveness, adequacy or enforceability of the Instrument
or any document relating thereto and assumes no responsibility for the financial
condition of the Company or for the performance and observance by the Company of
any of its respective undertakings, liabilities and obligations under the
Instrument or any document relating thereto, and any and all such conditions and
warranties, whether express or implied by law or otherwise, are hereby
excluded.

     

    4. In connection with the transfer of the
Transfer Notes, the Transferring Holder confirms that it has not utilised any
general solicitation or general advertising in connection with the Transfer
Notes or the transfer of the Transfer Notes.

     

    5. Unless, either (i), one of the boxes below
is checked by the Transferring Holder or (ii) the Loan Notes
are transferred pursuant to an effective registration statement under the
Securities Act, the Company shall not be obliged to register any of the Loan
Notes evidenced in the name of any person other than the Transferring
Holder.

     

    10

     

    

    
    

    6. By checking the box
checked below, the Transferring Holder confirms that the Transfer
Notes are being
transferred2:

     

    
      	
            	(i)	
            	[_____] to the Company or a subsidiary thereof;
      or
	
            	 
	
            	(ii)	
            	[_____] pursuant to and in compliance with Rule
      144A under the Securities Act; or
	
            	 
	
            	(iii)	
            	[_____] to an institutional “accredited
      investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the
      Securities Act); or
	
            	 
	
            	(iv)	
            	[_____] outside the United States to a “foreign
      person” in compliance with Rule 904 of Regulation S under the Securities
      Act; or
	
            	 
	
            	(v)	
            	[_____] pursuant to the exemption from
      registration provided by Rule 144 under the Securities Act;
      or
	
            	 
	     	(vi)	     	[_____] pursuant to another available exemption
      from the registration requirements of the Securities
  Act.

    

     

    7. The
Transferee hereby requests the Company:

     

    
      	(a)	
            	to accept this Transfer
      Certificate as being delivered to it pursuant to, and for the purposes of,
      paragraph 5 of Schedule 3 to the Instrument in relation to the Transfer
      Notes; and
	 
	(b)	
            	to register it in the Register as
      the Noteholder in respect of the Transfer Notes; and
	 
	(c)	     	to issue a certificate in its name
      in relation to the Transfer Notes in accordance with clause 6 of the
      Instrument.

    

     

    8. The
Transferee confirms that it has acceded to the Put and Call Agreement in
accordance with paragraph 4 of Schedule 3 to the Instrument and encloses
herewith:

     

    
      	 	(i)	
            	a copy of the form of assignment
      prescribed by the Put Call Agreement duly executed by it;
    and
	 	 
	     	(ii)	     	the certificate that evidences the
      Transferring Holder’s title to the Transfer
  Notes.

    
____________________
  

    
      	2	     	If box (iii), (iv),
      (v) or (vi) is checked, the Company may require, prior to registering any
      such transfer of the Transfer Notes such legal opinions, as the Company
      reasonably requests to confirm that such transfer is being made pursuant
      to an exemption from, or in a transaction not subject to, the registration
      requirements of the Securities Act.

    

     

    11

     

    

    
    

    9. The
Transferee warrants that it has received a copy of the Instrument together with
such other information as it has required in connection with this transaction
and that it has not relied, and will not hereafter rely, on the Transferring
Holder to check or enquire on its behalf into the legality, validity,
effectiveness, adequacy, accuracy or completeness of any such information and
further agrees that it has not relied, and will not rely, on the Transferring
Holder to assess or keep under review on its behalf the financial condition,
creditworthiness, condition, affairs, status or nature of the
Company.

     

    10. The
Transferee hereby undertakes with the Transferring Holder and each of the other
parties to the Instrument that it will perform in accordance with their terms
all those undertakings, liabilities and obligations that by the terms of the
Instrument will be assumed by it after delivery of this Transfer Certificate to
the Company and satisfaction of the conditions subject to which this Transfer
Certificate is expressed to take effect.

     

    11. This
Transfer Certificate is not assignable or otherwise negotiable (without
prejudice to the provisions of Schedule 3 to the Instrument which shall be
applicable to the Transferring Holder in respect of the Retained Notes and to
the Transferee in relation to any transfer or assignment of the rights,
undertakings, liabilities and obligations assumed by it pursuant
hereto).

     

    12. This
Transfer Certificate and the rights, undertakings, liabilities and obligations
of the parties hereunder shall be governed by and construed in accordance with
the laws of the State of New York.

     

    13. Each of the
Transferor and the Transferee agrees that the courts of the State of New York
are to have exclusive jurisdiction to settle any disputes that may arise in
connection with this Agreement.

     

    12

     

    

    
    

    APPENDIX

     

    
      	[Insert details of Transfer
      Notes.]	 	 
	 	 	
            	 	 
	 	
            	
            
	For and on behalf of the
      Transferring Holder	 	For and on behalf of the
      Transferee

    

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    13

     

    

    
    

    SCHEDULE
6

     

    Restrictions
on Transfer of Loan Notes

     

    
      	(a)	     	
              Each Noteholder agrees that any proposed
      transfer of any Loan Notes, or any shares of Common Stock issuable upon
      conversion or exchange thereof, may be effected only (1)(w) inside the
      United States of America (I) to a person who the seller reasonably
      believes is a qualified institutional buyer within the meaning of Rule
      144A in a transaction meeting the requirements of Rule 144A, (II) in
      accordance with Rule 144 or (III) pursuant to another exemption from the
      registration requirements of the Securities Act, (x) to the Company, (y)
      outside the United States of America (A) to a non-U.S. person (within the
      meaning of Regulation S) in a transaction meeting the requirements of
      Regulation S or (B) pursuant to another exemption from the registration
      requirements of the Securities Act or (z) pursuant to an effective
      registration statement and (2) in each case, in accordance with the
      application securities laws of any state of the United States of America
      or any other application jurisdiction. Each Noteholder agrees to notify
      any purchaser of the resale restrictions set forth
      above.

            
	 
      
	(b)	
            	Prior
      to any Transfer or proposed Transfer of any Loan Notes, the Noteholder
      thereof shall deliver written notice to the Company in the form set out in
      Schedule 5 of such Noteholder’s intention to effect such transfer. If the
      transfer or proposed transfer is pursuant to clause (1)(w) or (1)(y) of
      the first sentence of the preceding paragraph, then upon receipt of such
      notice, the Company may request any or all of the following (each a Transfer Document) in a
      form reasonably acceptable to the Company:
	 
      
	 	
            	(i)	     	an
      agreement by such transferee to the impression of the restrictive
      investment legend set forth below on the Loan Note certificates, or any
      shares of Common Stock issuable upon conversion or exchange
      thereof;
	 
	 	
            	(ii)	
            	an
      agreement by such transferee, in form and substance reasonably
      satisfactory to the Company, to be bound by the provisions of this
      Schedule 6 relating to the transfer of such Loan Notes, or any shares of
      Common Stock issuable upon conversion or exchange thereof;
      and
	 
	 	
            	(iii)	
            	an
      opinion of counsel with expertise in securities law matters reasonably
      satisfactory to the Company that such transfer complies with applicable
      securities laws.
	 
	
            	
            	If the Company requests any Transfer Document(s), it shall do so as
      promptly as practicable following receipt of the Holder’s notice of
      intention to Transfer. The Company shall thereafter cause the Transfer to
      be recorded and a certificate or other evidence of ownership in the name
      of the transferee to be delivered as soon as practicable after it has
      received Transfer Documents complying with the terms of this
      Schedule.

    

     

    14

     

    

    
    

    
      	(c)	
            	The Noteholders agree that each
      certificate issued to evidence Loan Notes, or any shares of Common Stock
      issuable upon conversion of exchange thereof shall bear a legend to the
      following effect:
	 	 	 
	 	 	THE
      SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
      THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR ANY
      OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN
      EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
      SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
      PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
      ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
      REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS
      EXEMPT FROM SUCH REGISTRATION.
	 
	 	
            	The
      foregoing legend shall be in addition to any other legend required by
      law.
	 
	(d)	     	The
      restrictions referenced in this Schedule, including the legend, shall
      cease and terminate as to any particular Loan Notes, or any shares Common
      Stock issuable upon conversion or exchange thereof when (x) such Loan
      Notes, or any shares Common Stock issuable upon conversion or exchange
      thereof have been transferred in a transaction pursuant to Rule 144 or a
      registration statement or (y) in the reasonable opinion of counsel for the
      Company, such restriction is no longer required in order to assure
      compliance with the Securities Act and applicable state securities laws.
      Whenever such restrictions shall cease and terminate as to any Notes, the
      Noteholder shall be entitled to received from the Company, without expense
      (other than applicable transfer taxes, if any, if such unlegended shares
      are being delivered and transferred to any person other than the
      registered Noteholder thereof), new certificates for a like number of
      Notes not bearing the relevant legend(s) set forth in this
      Schedule.

    

     

    15

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