Document:

Exhibit 10.1

 

LETTER AGREEMENT

 

Via Email

 

Oleg Firer

3363 NE 163rd St., Suite 705

North Miami Beach, FL 33160

Email: ofirer@unifiedpayments.com

 

Steven Wolberg

3363 NE 163rd St., Suite 705

North Miami Beach FL 33160

Email: swolberg@netelement.com

 

Georgia Notes 18 LLC

4000 NE 168th Street, Unit 101,

North Miami Beach, Florida 33160

Attention: Anzheliqua Zalkin

Fax: 786-272-0696

Email: georgianotes@gmail.com

 

Vladimir Sadovskiy

3363 NE 163 Street, Suite 705

North Miami Beach, FL 33160

Fax: 786-272-0696

Email: vlad@newedgepayments.com

 

		Re:	Exchange of Shares

 

This letter agreement
is dated as of August 28, 2013 (the “Effective Date”).

 

Reference is made to
(i) 100,000 shares of common stock, par value $0.0001 per share (“TOT Common Stock”), of TOT Group, Inc., a Delaware
corporation (“TOT Group”), which shares were issued by TOT Group to Unified Payments, LLC, a Delaware limited
liability company (“Unified”), and are evidenced by Stock Certificate No. C-2.

 

The parties hereto
acknowledge that Unified made a distribution of all of the 100,000 shares of TOT Common Stock to the following members of Unified
in proportions set forth next to the name of each such distributee (each, a “Distributee” and, collectively, the
“Distributees”):

 

		Oleg Firer	45,000 shares of TOT Common Stock (representing 4.5%
of the total issued and outstanding TOT Common Stock as of the Effective Date);

 

    	 

    	 

    

 

		Steven Wolberg	20,000 shares of TOT Common Stock (representing 2% of
the total issued and outstanding TOT Common Stock as of the Effective Date);
	 	 	 
	 	Georgia Notes 18 LLC,
a Florida limited
liability company (“Georgia
               Notes”)	30,000
shares of TOT Common Stock (representing 3% of the total issued and outstanding TOT Common Stock as of the Effective Date);
	 	 	 
	 	Vladimir Sadovskiy	5,000 shares of TOT Common Stock (representing 0.5% of the total issued and outstanding TOT Common Stock as of the Effective
Date).

 

The parties hereto
further acknowledge that, in furtherance of this distribution, the Stock Certificate No. C-2 evidencing 100,000 shares of TOT Common
Stock was cancelled and replaced with:

 

(1) Stock Certificate No. C-3
evidencing 45,000 shares of TOT Common Stock issued to Oleg Firer;

 

(2) Stock Certificate No. C-4
evidencing 20,000 shares of TOT Common Stock issued to Steven Wolberg;

 

(3) Stock Certificate No. C-5
evidencing 30,000 shares of TOT Common Stock issued to Georgia Notes; and

 

(4) Stock Certificate No. C-6
evidencing 5,000 shares of TOT Common Stock issued to Vladimir Sadovskiy.

 

The parties hereby agree as follows:

 

		1.	Each Distributee hereby represents and warrants to NETE as follows: (a) Distributee has all necessary
power and authority to execute and deliver this letter agreement (including Exhibit A hereto) and to perform the
obligations to be performed by Distributee; (b) this letter agreement has been duly executed and delivered by Buyer and this letter
agreement (including Exhibit A hereto) constitutes the legal, valid and binding obligations of Distributee enforceable
against Distributee in accordance with its terms and (c) neither Distributee nor any of its principals, officers or directors (as
applicable) has retained or authorized any investment banker, broker, finder or other intermediary to act on behalf of Distributee
or incurred any liability for any banker’s, broker’s or finder’s fees or commissions in connection with the transactions
contemplated by this letter agreement.

 

    	-2-

    	 

    

 

		2.	Exchange of Shares of TOT Common Stock. Subject to approval of the stockholders of Net Element
International, Inc., a Delaware corporation (“NETE”), at the 2013 annual meeting of stockholders of NETE of the
transactions described in this paragraph 2, including the issuance of the applicable shares of common stock, par value $0.0001
per share, of NETE (“NETE Stock”) in furtherance of these transactions (the “Exchange”), as soon
as practically possible after such stockholders’ approval, and in any event prior to the issuances of NETE Stock to Aptito.com,
Inc. (or its affiliate or related person), Evgueny Finckestein, Curtis Wolfe and/or either Igor Krutoy or any of his related entities
or Kenes Rakishev or any of his related entities (as applicable), the following transactions shall take place:

 

		(i)	45,000 shares of TOT Common Stock issued to Oleg Firer pursuant to the Stock Certificate No. C-3
shall be exchanged for NETE Stock as follows: (1) Oleg Firer shall transfer the shares of TOT Common Stock evidenced by the Stock
Certificate No. C-3 to NETE by endorsing (by way of executing and delivering stock power) such certificate over to NETE and delivering
such certificate to NETE’s President; and (2) upon such endorsement and delivery, NETE shall issue to Oleg Firer such number of
shares of NETE stock that would equal 4.5% of the total issued and outstanding shares of NETE Stock at the time of such issuance.

 

		(ii)	20,000 shares of TOT Common Stock issued to Steven Wolberg pursuant to the Stock Certificate No.
C-4 shall be exchanged for NETE Stock as follows: (1) Steven Wolberg shall transfer the shares of TOT Common Stock evidenced by
the Stock Certificate No. C-4 to NETE by endorsing (by way of executing and delivering stock power) such certificate over to NETE
and delivering such certificate to NETE’s President; and (2) upon such endorsement and delivery, NETE shall issue to Steven Wolberg
such number of shares of NETE stock that would equal 2% of the total issued and outstanding shares of NETE Stock at the time of
such issuance.

 

		(iii)	30,000 shares of TOT Common Stock issued to Georgia Notes pursuant to the Stock Certificate No.
C-5 shall be exchanged for NETE Stock as follows: (1) Georgia Notes shall transfer the shares of TOT Common Stock evidenced by
the Stock Certificate No. C-5 to NETE by endorsing (by way of executing and delivering stock power) such certificate over to NETE
and delivering such certificate to NETE’s President; and (2) upon such endorsement and delivery, NETE shall issue to Georgia Notes
such number of shares of NETE stock that would equal 3% of the total issued and outstanding shares of NETE Stock at the time of
such issuance.

 

		(iv)	5,000 shares of TOT Common Stock issued to Vladimir Sadovskiy pursuant to the Stock Certificate
No. C-6 shall be exchanged for NETE Stock as follows: (1) Vladimir Sadovskiy shall transfer the shares of TOT Common Stock evidenced
by the Stock Certificate No. C-6 to NETE by endorsing (by way of executing and delivering stock power) such certificate over to
NETE and delivering such certificate to NETE’s President; and (2) upon such endorsement and delivery, NETE shall issue to Vladimir
Sadovskiy such number of shares of NETE stock that would equal 0.5% of the total issued and outstanding shares of NETE Stock at
the time of such issuance.

 

    	-3-

    	 

    

 

		3.	Voting Agreement. Mike Zoi and Kenges Rakishev shall, and shall cause their respective controlled
entities that hold shares of NETE Stock to, vote at NETE’s stockholders 2013 annual meeting in favor of the Exchange and the issuance
of the applicable shares of NETE Stock in furtherance of the Exchange (collectively, the “New Shares”).

 

		4.	Securities Laws Representations. The Distributees understand and acknowledge that the issuance
of the New Shares shall be unregistered in reliance on the applicable exemption under the federal securities laws, and any dispositions
of the New Shares shall be subject to Rule 144 under the Securities Act of 1933. In connection with the issuance of the New Shares
and as a condition to the issuance of such shares by NETE, each of the Distributees hereby provides to NETE the representations
and warranties set forth in Exhibit A hereto.

 

		5.	Notices. All notices, requests, demands, and other communications required or permitted
hereunder shall be in writing and shall be deemed to have been duly given (i) when delivered by verifiable facsimile or electronic
mail transmission, unless such delivery is made on a day that is not a business day, in which case such delivery will be deemed
to be made on the next succeeding business day or (ii) on the next business day after timely delivery to a reputable overnight
courier, to the parties at the addresses set forth on the first page hereto.

 

		6.	General. This letter agreement constitutes the entire agreement among the parties hereto
pertaining to the subject matter hereof and supersedes all prior agreements and understandings pertaining thereto. This letter
agreement may not be amended or modified in any respect, except by the written agreement of the parties hereto. No party hereto
may, without the prior written consent of the other party hereto, assign or otherwise transfer, in whole or in part, any of its
rights and obligations under this letter agreement. Except as expressly provided for herein, nothing in this letter agreement shall
confer any rights upon any person that is not a party hereto or the successor or permitted assignee of a party to this letter agreement.
This letter agreement may be executed and delivered (including by facsimile transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original
but all of which taken together shall constitute one and the same agreement. Copies of executed counterparts transmitted by telecopy
or other electronic transmission service shall be considered original executed counterparts.

 

		7.	Governing Law. This letter agreement shall be governed by, and shall be construed, interpreted
and enforced in accordance with the laws of the State of Florida without regard to its choice of law provisions that would require
the application of the law of another jurisdiction.

 

    	-4-

    	 

    

 

		8.	Venue. Any action or proceeding brought to enforce, challenge or construe the terms or making
of this letter agreement, and any claims arising out of or related to this letter agreement, shall be exclusively brought and litigated
exclusively in a state or federal court having subject matter jurisdiction and located in Miami-Dade County, Florida. For the purpose
of any action or proceeding instituted with respect to any claim arising out of or related to this letter agreement, each party
hereby irrevocably submits to the exclusive jurisdiction of the state or federal courts having subject matter jurisdiction and
located in Miami-Dade County, Florida. Each party hereby irrevocably waives any objection or defense which it may now or hereafter
have of improper venue, forum non conveniens, or lack of personal jurisdiction. Each party further irrevocably consents to the
service of process out of such courts by the mailing of a copy thereof, by registered mail, postage prepaid, to the party and agrees
that such service, to the fullest extent permitted by applicable laws, (i) shall be deemed in every respect effective service
of process upon it in any suit, action or proceeding arising out of or related to this letter agreement and (ii) shall be
taken and held to be valid personal service upon and personal delivery to it. Nothing herein contained shall affect the right of
each party to serve process in any other manner permitted by applicable laws.

 

		9.	Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY WAIVES TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER PARTY WITH RESPECT TO ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS
LETTER AGREEMENT.

 

[Signatures are on next page.]

 

    	-5-

    	 

    

 

Please indicate your consent to the terms
of this letter agreement by signing and dating this letter agreement and returning it to the undersigned.

 

 

	 	NET
ELEMENT INTERNATIONAL, INC.
	 	 
	 	 
	 	By: 	/s/ Jonathan New
	 	Name:
Title:	Jonathan New
CFO

 

 

	Agreed and accepted by:	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	/s/ Oleg
Firer	 	 	 	 
	OLEG
FIRER	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	/s/ Steven Wolberg	 	 	 	 
	STEVEN WOLBERG	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	/s/ Vladimir Sadovskiy	 	 	 	 
	VLADIMIR SADOVSKIY	 	 	 	 

 

 

	GEORGIA NOTES 18, LLC	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By:	/s/ Anzheliqua Zalkin	 	 	 	 
	Name:	Anzheliqua Zalkin	 	 	 	 
	Title:	Managing Member	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	/s/ Kenges Rakishev	 	 	 	 
	KENGES RAKISHEV	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	/s/ Mike Zoi	 	 	 	 
	MIKE ZOI	 	 	 	 

 

    	-6-

    	 

    

 

Exhibit A

 

Representations and Warranties

 

As a condition to the issuance of the New
Shares to any of the Distributees, each Distributee hereby represents and warrants to NETE as follows:

 

Distributee acknowledges that the issuance
to it of the shares of common stock of NETE representing the New Shares has not been reviewed by the United States Securities and
Exchange Commission or any state securities regulatory authority because such transaction is intended to be exempt from the registration
requirements of the Securities Act of 1933, as amended (the “Securities Act”), and applicable state securities
laws. Distributee understands that each of NETE is relying upon the truth and accuracy of, and Distributee’s compliance with,
the representations, warranties, acknowledgments and understandings of Distributee set forth in this letter agreement in order
to determine the availability of such exemptions and the eligibility of Distributee to acquire the New Shares.

 

Distributee represents that the New Shares
are being acquired by Distributee for its own account, for investment purposes only and not with a view to or for distribution
or resale to others in contravention of the registration requirements of the Securities Act or applicable state securities laws.
Distributee agrees that it will not sell or otherwise transfer any of the New Shares unless such transfer or resale is registered
under the Securities Act and applicable state securities laws or unless exemptions from such registration requirements are available.

 

Distributee has such knowledge and experience
in financial and business matters that it is capable of evaluating the merits and risks of Distributee’s investment in NETE
through Distributee’s acquisition of the New Shares. Distributee is able to bear the economic risk of its investment in NETE
through Distributee’s acquisition of the New Shares for an indefinite period of time. At the present time, Distributee can
afford a complete loss of such investment and has no need for liquidity in such investment.

 

Distributee recognizes that its acquisition
of the New Shares involves a high degree of risk in that: (a) an investment in NETE is highly speculative and only Distributee
who can afford the loss of their entire investment should consider investing in NETE and securities of NETE; (b) transferability
of the New Shares is limited; (c) NETE has experienced recurring losses and it must raise substantial additional capital in order
to continue operating its business; (d) subsequent equity financings will dilute the ownership and voting interests of Distributee
and equity securities issued by NETE to other persons or entities may have rights, preferences or privileges senior to the rights
of Distributee; (e) any debt financing that may be obtained by NETE must be repaid regardless of whether NETE generates revenues
or cash flows from operations and may be secured by substantially all of NETE’s assets; (f) there is absolutely no assurance
that any type of financing on terms acceptable to NETE will be available to NETE or otherwise obtained by NETE; and (g) if NETE
is unable to obtain additional financing or is unable to obtain additional financing on terms acceptable to it, then NETE may be
unable to implement its business plans or take advantage of business opportunities, which could have a material adverse effect
on NETE’s business prospects, financial condition and results of operations and may ultimately require NETE to suspend or
cease operations.

 

    	-7-

    	 

    

 

Distributee acknowledges that he has prior
investment experience and that he recognizes and fully understands the highly speculative nature of Distributee’s investment
in NETE pursuant to its acquisition of the New Shares. Distributee acknowledges that he, either alone or together with its professional
advisors, has the capacity to protect its own interests in connection with this transaction.

 

Distributee acknowledges that it has carefully
reviewed the this letter agreement and NETE’s filings with the United States Securities and Exchange Commission, which are
available on the Internet at www.sec.gov, all of which documents and filings Distributee acknowledges have been made available
to it. Distributee has been given the opportunity to ask questions of, and receive answers from, NETE concerning this letter agreement,
the issuance to it of the New Shares, and NETE’s business, operations, financial condition and prospects, and Distributee
has been given the opportunity to obtain such additional information, to the extent NETE possesses such information or can acquire
it without unreasonable effort or expense, necessary to verify the accuracy of same as Distributee reasonably desires in order
to evaluate its investment in NETE pursuant its acquisition of the New Shares. Distributee fully understands all of such documents
and filings and has had the opportunity to discuss any questions regarding any of such documents or filings with its legal counsel
and tax, investment and other advisors. Notwithstanding the foregoing, Distributee acknowledges and agrees that the only information
upon which it has relied upon in executing this letter agreement is the information set forth in this letter agreement and NETE’s
filings with the United States Securities and Exchange Commission. Distributee acknowledges that it has received no representations
or warranties from NETE, its employees, agents or attorneys in making this investment decision. Distributee acknowledges that it
does not desire to receive any further information from NETE or any other person or entity in order to make a fully informed decision
of whether or not to execute this letter agreement and accept the New Shares.

 

Distributee acknowledges that the issuance
to it of the New Shares may involve tax consequences to Distributee. Distributee acknowledges and understands that Distributee
must retain its own professional advisors to evaluate the tax and other consequences of Distributee’s receipt of the New
Shares.

 

Distributee understands and acknowledges
that NETE is under no obligation to register the resale of the New Shares under the Securities Act or any state securities laws.
Distributee agrees that NETE may, if it desires, permit the transfer of the New Shares out of Distributee’s name only when
Distributee’s request for transfer is accompanied by an opinion of counsel reasonably satisfactory to NETE that the proposed
transfer satisfies an applicable exemption from registration requirements under the Securities Act and applicable state securities
laws.

 

    	-8-

    	 

    

 

Distributee understands that the certificate(s)
representing the New Shares shall bear a restrictive legend in substantially the following form (and a stop-transfer order may
be placed against transfer of the New Shares):

 

THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR (B) AN OPINION OF COUNSEL, IN
A REASONABLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS, OR (II) UNLESS
SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

 

The legend set forth above will be removed,
and NETE will issue a certificate without such legend to the holder of the New Shares upon which it is stamped, only if (a) such
New Shares are being sold pursuant to an effective registration statement under the Securities Act, (b) such holder delivers to
NETE an opinion of counsel, in a reasonably acceptable form to NETE, that the disposition of the New Shares is being made pursuant
to an exemption from federal and state registration requirements, or (c) such holder provides NETE with reasonable assurance that
a disposition of the New Shares may be made pursuant to Rule 144 under the Securities Act without any restriction as to the number
of shares acquired as of a particular date that can then be immediately sold.

 

Distributee acknowledges that he has a
preexisting personal or business relationship with NETE or one or more of its officers, directors or controlling persons.

 

Distributee represents and warrants that
he was not induced to invest in NETE (pursuant to the issuance to it of the New Shares) by any form of general solicitation or
general advertising, including, but not limited to, the following: (a) any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media (including via the Internet) or broadcast over the news or radio; and (b)
any seminar or meeting whose attendees were invited by any general solicitation or advertising.

 

Each Distributee’s current address
is as stated on the first page of the letter agreement.

 

    	-9-TAX BENEFITS PRESERVATION RIGHTS AGREEMENT

 

Dated as of September 9, 2013

 

By and between

 

SED INTERNATIONAL HOLDINGS, INC.

 

and

 

COMPUTER SHARE TRUST COMPANY, N.A., 

 

as Rights Agent 

 

    	 

    	 

    

 

Table of Contents

  

	 	Page
	 	 
	Section 1. Certain Definitions	1
	 	 
	Section 2. Appointment of Rights Agent	7
	 	 
	Section 3. Issue of Right Certificates	8
	 	 
	Section 4. Form of Right Certificates	10
	 	 
	Section 5. Countersignature and Registration	11
	 	 
	Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates	11
	 	 
	Section 7. Exercise of Rights; Exercise Price; Expiration Date of Rights	12
	 	 
	Section 8. Cancellation and Destruction of Right Certificates	14
	 	 
	Section 9. Reservation and Availability of Preferred Stock	14
	 	 
	Section 10. Preferred Stock Record Date	15
	 	 
	Section 11. Adjustment of Exercise Price, Number and Kind of Shares or Number of Rights	16
	 	 
	Section 12. Certificate of Adjusted Exercise Price or Number of Shares	23
	 	 
	Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power	23
	 	 
	Section 14. Fractional Rights and Fractional Shares	26
	 	 
	Section 15. Rights of Action	26
	 	 
	Section 16. Agreement of Right Holders	27
	 	 
	Section 17. Right Certificate Holder Not Deemed a Stockholder	27
	 	 
	Section 18. Concerning the Rights Agent	28
	 	 
	Section 19. Merger or Consolidation or Change of Name of Rights Agent	28
	 	 
	Section 20. Duties of Rights Agent	29

 

    	i

    	 

    

 

	Section 21. Change of Rights Agent	31
	 	 
	Section 22. Issuance of New Right Certificates	32

 

	Section 23. Redemption	32
	 	 
	Section 24. Exchange	33
	 	 
	Section 25. Notice of Certain Events	34
	 	 
	Section 26. Notices	35
	 	 
	Section 27. Supplements and Amendments	36
	 	 
	Section 28. Successors	36
	 	 
	Section 29. Determinations and Actions by the Board of Directors	36
	 	 
	Section 30. Benefits of this Agreement	36
	 	 
	Section 31. Severability	37
	 	 
	Section 32. Governing Law	37
	 	 
	Section 33. Counterparts	37
	 	 
	Section 34. Descriptive Headings	37
	 	 
	Section 35. Force Majeure	37
	 	 
	Exhibit A — Articles of Amendment for  Series A Junior Participating Cumulative Preferred Stock	 
	 	 
	Exhibit B — Form of Right Certificate	 

 

    	- ii -

    	 

    

 

TAX BENEFITS PRESERVATION RIGHTS AGREEMENT

 

This Tax Benefits Preservation Rights Agreement,
dated as of September 9, 2013 (as it may be amended from time to time as provided herein, the “Agreement”),
is entered into by and between SED International Holdings, Inc., a Georgia corporation (the “Company”), and
Computershare Trust Company, N.A., a federally chartered trust company, as Rights Agent (the “Rights Agent”
which term shall include any successor Rights Agent hereunder). Capitalized terms contained herein and not otherwise defined shall
have the meanings ascribed to them in Section 1.

 

WITNESSETH

 

WHEREAS, the Company has generated
Tax Benefits (as defined in Section 1 hereof) for United States federal income tax purposes, and as such Tax Benefits may
potentially provide valuable tax benefits to the Company, the Company desires to avoid an “ownership change” within
the meaning of Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”) and the Treasury Regulations
promulgated thereunder, and thereby preserve the ability to utilize fully such Tax Benefits and, in furtherance of such objective,
the Company desires to enter into this Agreement;

 

WHEREAS, the Board of Directors of
the Company (“Board of Directors”) has authorized, and the Company declared, a dividend distribution of one
Right (as defined below) for each share of Common Stock outstanding as of the Close of Business on September 19, 2013 (the “Record
Date”), and authorized the issuance of one Right for each share of Common Stock of the Company issued between the Record
Date and the earlier of the Distribution Date or the Expiration Date, each Right initially representing the right to purchase one
one-thousandth of a share of Series A Junior Participating Cumulative Preferred Stock of the Company having the rights, powers
and preferences set forth on Exhibit A hereto, upon the terms and subject to the conditions hereinafter set forth (the
“Rights”); and

 

WHEREAS, the Company desires to appoint
the Rights Agent to act as rights agent hereunder, in accordance with the terms and conditions hereof.

 

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

 

Section 1. Certain Definitions. 
For purposes of this Agreement, the following terms have the meanings indicated:

 

“Acquiring Person” shall
mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the Beneficial Owner of 4.9%
or more of the shares of Common Stock of the Company then outstanding, but shall not include (i) the Company, (ii) any
Subsidiary of the Company, (iii) any employee benefit plan or compensation arrangement of the Company or any Subsidiary of
the Company, (iv) any Person holding shares of Common Stock of the Company organized, appointed or established by the Company
or any Subsidiary of the Company for or pursuant to the terms of any such employee benefit plan or compensation arrangement (the
Persons described in clauses (i) through (iv) above are referred to herein as “Exempt Persons”), or
(v) any Grandfathered Person, unless such Grandfathered Person becomes the Beneficial Owner of a percentage of the shares of Common
Stock of the Company then outstanding equal to or exceeding such Grandfathered Person’s Grandfathered Percentage (at which
such time such Grandfathered Person shall be deemed an “Acquiring Person”).

 

    	 

    	 

    

 

Notwithstanding the foregoing, no Person shall
become an “Acquiring Person” (i) as the result of an acquisition by the Company of Common Stock of the Company which,
by reducing the number of shares outstanding, increases the proportionate number of shares Beneficially Owned by such Person to
4.9% (or in the case of a Grandfathered Person, the Grandfathered Percentage applicable to such Grandfathered Person) or more of
the shares of Common Stock of the Company then outstanding; provided, however , that if a Person shall become the
Beneficial Owner of 4.9% (or in the case of a Grandfathered Person, the Grandfathered Percentage applicable to such Grandfathered
Person) or more of the shares of Common Stock of the Company then outstanding by reason of share purchases by the Company and shall,
after such share purchases by the Company, become the Beneficial Owner of any additional shares (other than pursuant to a stock
split, stock dividend or similar transaction) of Common Stock of the Company and immediately thereafter be the Beneficial Owner
of 4.9% (or in the case of a Grandfathered Person, the Grandfathered Percentage applicable to such Grandfathered Person) or more
of the shares of Common Stock of the Company then outstanding, then such Person shall be deemed to be an “Acquiring Person,”
(ii) who becomes the Beneficial Owner of 4.9% or more of the outstanding shares of Common Stock as a result of the acquisition
of shares of Common Stock directly from the Company, as long as, prior to the acquisition of shares of Common Stock directly from
the Company, the Company has been apprised in writing by any such Person of the number of shares of Common Stock Beneficially Owned
by such Person immediately prior to any such acquisition; provided, however, that if a Person shall become the Beneficial
Owner of 4.9% or more of the shares of Common Stock then outstanding as a result of a direct purchase from the Company and shall,
after that date, acquire one or more additional shares of the Company’s Common Stock without the prior written consent of
the Company and shall then Beneficially Own more than 4.9% of the shares of Common Stock then outstanding, then such Person shall
be deemed to be an “Acquiring Person;” and (iii) who becomes a Beneficial Owner of 4.9% or more of the shares of Common
Stock then outstanding and whose Beneficial Ownership would not, as determined by the Board of Directors in its sole discretion,
jeopardize or endanger the availability to the Company of its Tax Benefits (a “Board Exempt Person”); provided
further, however, that if a Person is not an Acquiring Person solely by reason of clause (iii) above, then such Person
shall cease to be a Board Exempt Person if (A) such Person ceases to Beneficially Own 4.9% or more of the shares of the then outstanding
Common Stock or (B) the Board of Directors, in its sole discretion, makes a contrary determination with respect to the effect of
such Person’s Beneficial Ownership with respect to the availability to the Company of its Tax Benefits.

 

In addition, notwithstanding the foregoing,
and notwithstanding anything to the contrary provided in this Agreement including without limitation in Section 1, Section
3(a) or Section 27 hereof, a Person shall not be an “Acquiring Person” if the Board of Directors determines
at any time that a Person who would otherwise be an “Acquiring Person,” has become such inadvertently without intending
to become an “Acquiring Person,” and such Person divests (without exercising or retaining any power, including, voting
power, with respect to such securities) as promptly as practicable (or within such period of time as the Board of Directors determines
is reasonable) a sufficient number of shares of Common Stock of the Company so that such Person would no longer be an “Acquiring
Person.”

 

“Adjustment Shares” shall
have the meaning set forth in Section 11(a)(ii) hereof.

 

    	2

    	 

    

 

“Affiliate” and “Associate”
shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations (the “Rules”)
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as in effect on the date of this
Agreement; and to the extent not included within the foregoing, shall also include with respect to any Person, any other Person
whose shares of Common Stock of the Company would be deemed to be constructively owned by such Person, owned by a “single
entity” as defined in Section 1.382-3(a)(1) of the Treasury Regulations, or otherwise aggregated with shares owned by such
first Person, pursuant to the provisions of the Code, or any successor or replacement provision, and the Treasury Regulations thereunder;
provided, however, that a Person shall not be deemed to be the Affiliate or Associate of another Person solely because
either or both Persons are or were directors of the Company.

 

A Person shall be deemed the “Beneficial
Owner” of, and shall be deemed to “Beneficially Own” and have “Beneficial Ownership”
of (or any derivative of such phrases), any securities:

 

(i)          which
such Person or any of such Person's Affiliates or Associates, directly or indirectly, has the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (whether
or not in writing) (including any purchase orders for shares of Common Stock initiated prior to the first public announcement of
the adoption of this Plan) or upon the exercise of conversion rights, exchange rights, warrants, options, or other rights (in each
case, other than upon exercise or exchange of the Rights); provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to Beneficially Own securities (including rights, options or warrants) which are convertible or exchangeable
into or exercisable for Common Stock until such time as such securities are converted or exchanged into or exercised for Common
Stock except to the extent the acquisition or transfer of such rights, options or warrants would be treated as exercised on the
date of its acquisition or transfer under Section 1.382-4(d) of the Treasury Regulations; provided, further, that
a Person shall not be deemed the Beneficial Owner of, or to Beneficially Own, securities tendered pursuant to a tender or exchange
offer made by such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for purchase
or exchange;

 

(ii)         which
such Person or any of such Person's Affiliates or Associates, directly or indirectly, has or shares the right to vote or dispose
of, or has "beneficial ownership" of (as defined under Rule 13d-3 of the Rules), including pursuant to any agreement,
arrangement or understanding (whether or not in writing), but only if the effect of such agreement, arrangement or understanding
is to treat such Person or any of such Person's Affiliates or Associates as an "entity" under Section 1.382-3(a)(1) of
the Treasury Regulations; or

 

    	3

    	 

    

 

(iii)        of
which any other Person is the Beneficial Owner, if such Person or any of such Person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) with such other Person (or any of such other Person's Affiliates or Associates)
with respect to acquiring, holding, voting or disposing of such securities of the Company, but only if the effect of such agreement,
arrangement or understanding is to treat such Person or any of such Person's Affiliates or Associates as an "entity"
under Section 1.382-3(a)(1) of the Treasury Regulations; provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to Beneficially Own, any security (A) if such Person has the right to vote such security pursuant to an
agreement, arrangement or understanding (whether or not in writing) which (1) arises solely from a revocable proxy or consent given
to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules
and regulations promulgated under the Exchange Act and (2) is not also then reportable on Schedule 13D or Schedule 13G under the
Exchange Act (or any comparable or successor report), or (B) if such Beneficial Ownership arises solely as a result of such Person's
status as a "clearing agency," as defined in Section 3(a)(23) of the Exchange Act; provided, further, that
nothing in this definition shall cause a Person engaged in business as an underwriter of securities or member of a selling group
to be the Beneficial Owner of, or to Beneficially Own, any securities acquired through such Person's participation in good faith
in an underwriting syndicate or selling group until the expiration of 40 calendar days after the date of such acquisition, or such
later date as the Board may determine in any specific case.

 

Notwithstanding anything herein to the contrary,
to the extent not within the foregoing provisions of this definition, a Person shall be deemed the Beneficial Owner of, and shall
be deemed to Beneficially Own or have Beneficial Ownership of, securities which such Person would be deemed to constructively own
or which otherwise would be aggregated with shares owned by such Person pursuant to Section 382 of the Code, or any successor provision
or replacement provision and the Treasury Regulations thereunder.

 

“Board Exempt Person” shall
have the meaning set forth in the definition of “Acquiring Person.”

 

“Book Entry” shall mean
an uncertificated book entry for any Common Stock or Preferred Stock.

 

“Business Day” shall mean
any day other than a Saturday, Sunday, or a day on which the New York Stock Exchange is authorized or obligated by law or executive
order to close.

 

“Charter” when used in
reference to the Company shall mean the charter of the Company, as may be amended or supplemented from time to time, of the Company.

 

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

 

“Code” shall have the meaning
set forth in the preamble to this Agreement.

 

“Common Stock” when used
in reference to the Company shall mean the Common Stock, par value $0.01 per share, of the Company or any other shares of capital
stock of the Company into which such stock shall be reclassified or changed.  “Common Stock” when used with reference
to any Person other than the Company organized in corporate form shall mean (i) the capital stock or other equity interest
of such Person with the greatest voting power, (ii) the equity securities or other equity interest having power to control
or direct the management of such Person or (iii) if such Person is a Subsidiary of another Person, the Person or Persons which
ultimately control such first-mentioned Person and which have issued any such outstanding capital stock, equity securities or equity
interest.  “Common Stock” when used with reference to any Person not organized in corporate form shall mean units
of beneficial interest which (x) shall represent the right to participate generally in the profits and losses of such Person
(including without limitation any flow-through tax benefits resulting from an ownership interest in such Person) and (y) shall
be entitled to exercise the greatest voting power of such Person or, in the case of a limited partnership, shall have the power
to remove or otherwise replace the general partner or partners.

 

    	4

    	 

    

 

“Common Stock Equivalents”
shall have the meaning set forth in Section 11(a)(iii)  hereof.

 

“Current Value” shall have
the meaning set forth in Section 11(a)(iii) hereof.

 

“Definitive Acquisition Agreement”
shall mean any agreement entered into by the Company that is conditioned on the approval by the holders of not less than a majority
of the outstanding shares of Common Stock entitled to vote at a meeting of the stockholders called with respect to (i) a merger,
consolidation, recapitalization, reorganization, share exchange, business combination or similar transaction involving the Company
or (ii) the acquisition in any manner, directly or indirectly, of more than 50% of the consolidated total assets (including,
without limitation, equity securities of its subsidiaries) or earning power of the Company.

 

“Depositary Agent” shall
have the meaning set forth in Section 7(c) hereof.

 

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

 

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

 

“Equity Compensation Plan Shares”
shall have the meaning set forth in the definition of “Grandfathered Percentage.”

 

“Exempt Person” shall have
the meaning set forth in the definition of “Acquiring Person.”

 

“Exercise Price” shall
mean, as of any date, the price at which a holder may purchase securities issuable upon exercise of one whole Right. Until adjustment
thereof in accordance with the terms hereof, the Exercise Price shall equal $6.00.

 

“Expiration Date” and “Final
Expiration Date” shall have the meanings set forth in Section 7(a) hereof.

 

“Fair Market Value” of
any securities or other property shall be as determined in accordance with Section 11(d) hereof.

 

“Grandfathered Percentage”
shall mean, with respect to any Grandfathered Person, the percentage of the outstanding shares of Common Stock of the Company that
such Grandfathered Person, together with all Affiliates and Associates of such Grandfathered Person, Beneficially Owns as of the
Grandfathered Time, plus (i) an additional 1/4% and (ii) any shares of Common Stock issued to a Grandfathered Person pursuant
to the Company’s equity compensation plans (“Equity Compensation Plan Shares”); provided, however,
that, in the event any Grandfathered Person shall sell, transfer, or otherwise dispose of any outstanding shares of Common Stock
of the Company after the Grandfathered Time, the Grandfathered Percentage shall, subsequent to such sale, transfer or disposition,
mean, with respect to such Grandfathered Person, the lesser of (i) the Grandfathered Percentage as in effect immediately prior
to such sale, transfer or disposition or (ii) the percentage of outstanding shares of Common Stock of the Company that such
Grandfathered Person Beneficially Owns immediately following such sale, transfer or disposition, plus (a) an additional 1/4% and
(b) any Equity Compensation Plan Shares granted to such Grandfathered Person subsequent to such sale, transfer or disposition.

 

    	5

    	 

    

 

“Grandfathered Person”
shall mean any Person who or which, together with all Affiliates and Associates of such Person, is, as of the Grandfathered Time,
the Beneficial Owner of 4.9% or more of the shares of Common Stock of the Company then outstanding.  Notwithstanding anything
to the contrary provided in this Agreement, any Grandfathered Person who after the Grandfathered Time becomes the Beneficial Owner
of less than 4.9% of the shares of Common Stock of the Company then outstanding shall cease to be a Grandfathered Person and shall
be subject to all of the provisions of this Agreement in the same manner as any Person who is not and was not a Grandfathered Person.

 

“Grandfathered Time” shall
mean 5:00 p.m., New York, New York time, on September 9, 2013.

 

“Group” shall have the
meaning set forth in clause (b) of the definition of “Person.”

 

“Ownership Statements”
means, with respect to any Book Entry Common Stock, current ownership statements issued to the record holders thereof in lieu of
a certificate representing such Common Stock.

 

“Person” shall mean (a) an
individual, a corporation, a partnership, a limited liability company, an association, a joint stock company, a trust, a business
trust, a government or political subdivision, any unincorporated organization, or any other association or entity including any
successor (by merger or otherwise) thereof or thereto, and (b) a “group” as that term is used for purposes of
Section 13(d)(3) of the Exchange Act.

 

“Preferred Stock” shall
mean shares of Series A Junior Participating Cumulative Preferred Stock, par value $1.00 per share, of the Company having
the rights and preferences set forth in the form of the articles of amendment attached hereto as Exhibit A.

 

“Preferred Stock Equivalents”
shall have the meaning set forth in Section 11(b) hereof.

 

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

 

“Record Date” shall have
the meaning set forth in the Preamble of this Agreement.

 

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

 

“Redemption Price” shall
have the meaning set forth in Section 23 hereof.

 

“Registered Common Stock”
shall have the meaning set forth in Section 13(b) hereof.

 

“Rights” shall have the
meaning set forth in the Preamble of this Agreement.

 

    	6

    	 

    

 

“Right Certificates” shall
have the meaning set forth in Section 3(a) hereof. 

 

“Section 11(a)(ii) Event”
shall have the meaning set forth in Section 11(a)(ii) hereof.

 

“Section 11(a)(ii) Trigger
Date” shall have the meaning set forth in Section 11(a)(iii) hereof.

 

“Section 13 Event”
shall mean any event described in clauses (x), (y) or (z) of Section 13(a) hereof.

 

“Section 24(a)(i) Exchange
Ratio” shall have the meaning set forth in Section 24(a)(i) hereof.

 

“Section 24(a)(ii) Exchange
Ratio” shall have the meaning set forth in Section 24(a)(ii) hereof.

 

“Securities Act” shall
mean the Securities Act of 1933, as amended.

 

“Spread” shall have the
meaning set forth in Section 11(a)(iii) hereof.

 

“Stock Acquisition Date”
shall mean the date of the first public announcement (which for purposes of this definition shall include, without limitation,
the issuance of a press release or the filing of a publicly-available report or other document with the Securities and Exchange
Commission or any other governmental agency) by the Company, acting pursuant to a resolution adopted by the Board of Directors,
or by an Acquiring Person, subject in each case to the last paragraph of the definition of “Acquiring Person,” that
an Acquiring Person has become such Acquiring Person.

 

“Subsidiary” shall mean,
with reference to any Person, any corporation or other entity of which securities or other ownership interests having ordinary
voting power sufficient, in the absence of contingencies, to elect a majority of the board of directors or other persons performing
similar functions of such corporation or other entity are at the time directly or indirectly Beneficially Owned or otherwise controlled
by such Person either alone or together with one or more Affiliates of such Person.

 

“Substitution Period” shall
have the meaning set forth in Section 11(a)(iii) hereof.

 

“Tax Benefits” shall mean
the net operating loss carryovers, capital loss carryovers, general business credit carryovers, alternative minimum tax credit
carryovers, foreign tax credit carryovers, any loss or deduction attributable to a “net unrealized built-in loss” within
the meaning of Section 382 of the Code, and the Treasury Regulations promulgated thereunder, of the Company or any of its Subsidiaries.

 

“Triggering Event” shall
mean any Section 11(a)(ii) Event or any Section 13 Event.

 

Section 2.  Appointment of
Rights Agent.  The Company hereby appoints the Rights Agent to act as agent for the Company in accordance with the terms
and conditions hereof, and the Rights Agent hereby accepts such appointment.  The Company may from time to time appoint such
Co-Rights Agents as it may deem necessary or desirable.  In the event the Company appoints one or more Co-Rights Agents, the
respective duties of the Rights Agent and any Co-Rights Agents shall be as the Company shall determine.  The Company shall
give ten (10) days’ prior written notice to the Rights Agent of the appointment of one or more Co-Rights Agents and
the respective duties of the Rights Agent and any such Co-Rights Agents.  The Rights Agent shall have no duty to supervise,
and shall in no event be liable for, the acts or omissions of any such Co-Rights Agent.

 

    	7

    	 

    

 

Section 3. Issue of Right Certificates.

 

(a)          From
the date hereof until the earlier of (i) the Close of Business on the tenth calendar day after the Stock Acquisition Date
or (ii) the Close of Business on the tenth Business Day (or such later calendar day, if any, as the Board of Directors may
determine in its sole discretion) after the date a tender or exchange offer by any Person, other than an Exempt Person, is first
published or sent or given within the meaning of Rule 14d-4(a) of the Exchange Act, or any successor rule, if, upon consummation
thereof, such Person could become the Beneficial Owner of 4.9% (or in the case of a Grandfathered Person, the Grandfathered Percentage
applicable to such Grandfathered Person) or more of the shares of Common Stock of the Company then outstanding (including any such
date which is after the date of this Agreement and prior to the issuance of the Rights) (the earliest of such dates being herein
referred to as the “Distribution Date”), (x) the Rights will be evidenced (subject to the provisions of
Section 3(b) hereof) by the certificates for the Common Stock of the Company registered in the names of the holders
of the Common Stock of the Company (or by Book Entry Common Stock of the Company) (which certificates for Common Stock of the Company
(or Book Entry Common Stock of the Company) shall be deemed also to be certificates for Rights) and not by separate certificates
or book entry, and (y) the Rights will be transferable only in connection with the transfer of the underlying shares of Common
Stock of the Company.  As soon as practicable after the Distribution Date, the Rights Agent will, at the Company’s expense
send, by first-class, insured, postage prepaid mail, to each record holder of the Common Stock of the Company as of the Close of
Business on the Distribution Date, at the address of such holder shown on the records of the Company, one or more certificates,
in substantially the form of Exhibit B hereto (the “Right Certificates”), evidencing one
Right for each share of Common Stock of the Company so held, subject to adjustment as provided herein.  In the event that
an adjustment in the number of Rights per share of Common Stock of the Company has been made pursuant to Section 11(o) hereof,
the Company may make the necessary and appropriate rounding adjustments (in accordance with Section 14(a) hereof)
at the time of distribution of the Right Certificates, so that Right Certificates representing only whole numbers of Rights are
distributed and cash is paid in lieu of any fractional Rights.  As of and after the Close of Business on the Distribution
Date, the Rights will be evidenced solely by such Right Certificates.

 

(b)          With
respect to certificates for Common Stock of the Company or Book Entry Common Stock of the Company issued prior to the Close of
Business on the Record Date, the Rights will be evidenced by such certificates for the Common Stock of the Company or Book Entry
Common Stock of the Company on or until the Distribution Date (or the earlier redemption, expiration or termination of the Rights),
and the registered holders of the Common Stock of the Company also shall be the registered holders of the associated Rights. 
Until the Distribution Date (or the earlier redemption, expiration or termination of the Rights), the transfer of any of the certificates
for the Common Stock of the Company or Book Entry Common Stock of the Company outstanding prior to the date of this Agreement
shall also constitute the transfer of the Rights associated with the Common Stock of the Company represented by such certificate
or Book Entry Common Stock of the Company.

 

    	8

    	 

    

 

(c)          Certificates
for the Common Stock of the Company or Book Entry Common Stock of the Company issued after the Record Date, but prior to the earlier
of the Distribution Date or the Expiration Date, shall be deemed also to be certificates for Rights, and shall bear a legend, substantially
in the form set forth below:

 

 This certificate also evidences
and entitles the holder hereof to certain Rights as set forth in a Tax Benefits Preservation Rights Agreement between SED International
Holdings, Inc. and Computershare Trust Company, N.A. (or any successor thereto), as Rights Agent, dated as of September 9, 2013
as amended, restated, renewed, supplemented or extended from time to time (the “Rights Agreement”), the terms
of which are hereby incorporated herein by reference and a copy of which is on file at the principal offices of SED International
Holdings, Inc. and the stock transfer administration office of the Rights Agent.  Under certain circumstances, as set forth
in the Rights Agreement, such Rights will be evidenced by separate certificates and will no longer be evidenced by this certificate. 
SED International Holdings, Inc. may redeem the Rights at a redemption price of $0.001 per Right, subject to adjustment, under
the terms of the Rights Agreement.  SED International Holdings, Inc. will mail to the holder of this certificate a copy of
the Rights Agreement, as in effect on the date of mailing, without charge promptly after receipt of a written request therefor. 
Under certain circumstances, Rights issued to or held by Acquiring Persons or any Affiliates or Associates thereof (as defined
in the Rights Agreement), and any subsequent holder of such Rights, may become null and void.  The Rights shall not be exercisable,
and shall be void so long as held, by a holder in any jurisdiction where the requisite qualification, if any, to the issuance to
such holder, or the exercise by such holder, of the Rights in such jurisdiction shall not have been obtained or be obtainable.

 

With respect to any Book Entry Common Stock
of the Company, such legend shall be included in the Ownership Statement in respect of such Common Stock or in a notice to the
record holder of such Common Stock in accordance with applicable law. With respect to such certificates containing the foregoing
legend, or any notice containing the foregoing legend delivered to holders of Book Entry Common Stock, the Rights associated with
the Common Stock of the Company represented by such certificates shall be evidenced by such certificates or such Book Entry Common
Stock (including any Ownership Statement) alone until the earlier of the Distribution Date or the Expiration Date, and the transfer
of any of such certificates or Book Entry Common Stock shall also constitute the transfer of the Rights associated with the Common
Stock of the Company represented by such certificates.  In the event that the Company purchases or acquires any shares of
Common Stock of the Company after the Record Date but prior to the Distribution Date, any Rights associated with such Common Stock
of the Company shall be deemed canceled and retired so that the Company shall not be entitled to exercise any Rights associated
with the shares of Common Stock of the Company which are no longer outstanding.  The failure to print the foregoing legend
on any such certificate representing Common Stock of the Company or any defect therein shall not affect in any manner whatsoever
the application or interpretation of the provisions of Section 7(e) hereof.

 

    	9

    	 

    

 

Section 4.  Form of
Right Certificates.

 

(a)           The
Right Certificates (and the forms of election to purchase shares and of assignment and certificate to be printed on the reverse
thereof) shall each be substantially in the form of Exhibit B hereto and may have such marks of identification or designation
and such legends, summaries or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with
the provisions of this Agreement, or as may be required to comply with any applicable law, rule or regulation or with any
rule or regulation of any stock exchange on which the Rights may from time to time be listed, or to conform to customary usage. 
The Right Certificates shall be in a machine printable format and in a form reasonably satisfactory to the Rights Agent. 
Subject to the provisions of Section 11 and Section 22 hereof, the Right Certificates, whenever distributed,
shall be dated as of the Record Date, shall show the date of countersignature, and on their face shall entitle the holders thereof
to purchase such number of one one-thousandths of a share of Preferred Stock as shall be set forth therein at the Exercise Price,
but the number of such shares and the Exercise Price shall be subject to adjustment as provided herein.

 

(b)           Any
Right Certificate issued pursuant to Section 3(a) or Section 22 hereof that represents Rights Beneficially
Owned by (i) an Acquiring Person or any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any Associate or Affiliate of an Acquiring Person) who becomes a transferee after the Acquiring Person becomes such,
or (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights pursuant to either (A) a transfer (whether or
not for consideration) from the Acquiring Person to holders of equity interests in such Acquiring Person or to any Person with
whom the Acquiring Person has any continuing agreement, arrangement or understanding (whether or not in writing) regarding the
transferred Rights, the shares of Common Stock of the Company associated with such Rights or the Company or (B) a transfer
which the Board of Directors has determined is part of a plan, arrangement or understanding which has as a primary purpose or effect
the avoidance of Section 7(e) hereof, and any Right Certificate issued pursuant to Section 6, Section 11
or Section 22 hereof upon transfer, exchange, replacement or adjustment of any other Right Certificate referred to
in this sentence, shall have deleted therefrom the second sentence of the existing legend on such Right Certificate and in substitution
therefor shall contain the following legend:

 

The Rights represented by this Right Certificate are
or were Beneficially Owned by a Person who was or became an Acquiring Person or an Affiliate or an Associate of an Acquiring Person
(as such terms are defined in the Rights Agreement).  This Right Certificate and the Rights represented hereby may become
null and void under certain circumstances as specified in Section 7(e) of the Rights Agreement.

 

The Company shall give notice to the Rights
Agent promptly after it becomes aware of the existence and identity of any Acquiring Person or any Associate or Affiliate thereof. 
The Company shall instruct the Rights Agent in writing of the Rights which should be so legended.  The failure to print the
foregoing legend on any such Right Certificate or any defect therein shall not affect in any manner whatsoever the application
or interpretation of the provisions of Section 7(e) hereof.

 

    	10

    	 

    

 

Section 5.  Countersignature
and Registration.

 

(a)           The
Right Certificates shall be executed on behalf of the Company by its Chairman or Vice Chairman of the Board of Directors, its President,
any Vice President, Chief Executive Officer, its Chief Operating Officer or its Chief Financial Officer, either manually or by
facsimile signature, and shall have affixed thereto the Company’s seal or a facsimile thereof which shall be attested to
by the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company, either manually or by facsimile
signature.  The Right Certificates shall be countersigned, either manually or by facsimile signature, by an authorized signatory
of the Rights Agent and shall not be valid for any purpose unless so countersigned, and such countersignature upon any Right Certificate
shall be conclusive evidence, and the only evidence, that such Right Certificate has been duly countersigned as required hereunder. 
In case any officer of the Company who shall have signed any of the Right Certificates shall cease to be such officer of the Company
before countersignature by the Rights Agent and issuance and delivery by the Company, such Right Certificates, nevertheless, may
be countersigned by an authorized signatory of the Rights Agent, and issued and delivered by the Company with the same force and
effect as though the person who signed such Right Certificates had not ceased to be such officer of the Company; and any Right
Certificates may be signed on behalf of the Company by any person who, at the actual date of the execution of such Right Certificate,
shall be a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Rights Agreement
any such person was not such an officer.

 

(b)          Following
the Distribution Date, the Rights Agent will keep or cause to be kept, at one of its offices designated as the appropriate place
for surrender of Right Certificates upon exercise or transfer, books for registration and transfer of the Right Certificates issued
hereunder.  Such books shall show the names and addresses of the respective holders of the Right Certificates, the number
of Rights evidenced on its face by each of the Right Certificates and the date of each of the Right Certificates.

 

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

 

(a)           Subject
to the provisions of Section 4(b), Section 7(e) and Section 14 hereof, at any time after
the Close of Business on the Distribution Date, and at or prior to the Close of Business on the Expiration Date, any Right Certificate
or Certificates may be transferred, split up, combined or exchanged for another Right Certificate or Certificates, entitling the
registered holder to purchase a like number of one one-thousandths of a share of Preferred Stock (or following a Triggering Event,
Common Stock of the Company, cash, property, debt securities, Preferred Stock or any combination thereof, including any such securities,
cash or property following a Section 13 Event) as the Right Certificate or Certificates surrendered then entitled such holder
to purchase and at the same Exercise Price.  Any registered holder desiring to transfer, split up, combine or exchange any
Right Certificate shall make such request in writing delivered to the Rights Agent, and shall surrender the Right Certificate or
Certificates to be transferred, split up, combined or exchanged, with the form of assignment and certificate duly executed, at
the office or offices of the Rights Agent designated for such purpose.  Neither the Rights Agent nor the Company shall be
obligated to take any action whatsoever with respect to the transfer of any such surrendered Right Certificate until the registered
holder shall have completed and signed the certificate contained in the form of assignment on the reverse side of such Right Certificate
and shall have provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall reasonably request.  Thereupon the Rights Agent shall, subject to Section 4(b),
Section 7(e) and Section 14 hereof, countersign and deliver to the Person entitled thereto a Right
Certificate or Certificates, as the case may be, as so requested.  The Company may require payment by the registered holder
of a Right Certificate, of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates.

 

    	11

    	 

    

 

(b)           Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation
of a Right Certificate, and, in case of loss, theft or destruction, of indemnity or security satisfactory to them, and reimbursement
to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon surrender to the Rights Agent and cancellation
of the Right Certificate, if mutilated, the Company will execute and deliver a new Right Certificate of like tenor to the Rights
Agent for countersignature and delivery to the registered owner in lieu of the Right Certificate so lost, stolen, destroyed or
mutilated.

 

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

 

(a)          Subject
to Section 7(e) hereof, the registered holder of any Right Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein) in whole or in part at any time after the Distribution Date upon surrender of the Right Certificate,
with the form of election to purchase and the certificate on the reverse side thereof duly executed, to the Rights Agent at the
office or offices of the Rights Agent designated for such purpose, together with payment of the aggregate Exercise Price for the
total number of one one-thousandths of a share of Preferred Stock (or other securities, cash or other assets, as the case may be)
as to which such surrendered Rights are then exercised, at or prior to the earliest of (i) the Close of Business on the third
anniversary of the Record Date (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed
as provided in Section 23 hereof (the “Redemption Date”) or (iii) the time at which such Rights
are exchanged as provided in Section 24 hereof (the “Exchange Date”) (iv) the final adjournment
of the Company's 2014 annual meeting of stockholders if stockholder approval of this Agreement has not been received prior to such
time, (v) the repeal of Section 382 of the Code or any successor statute if the Board determines that this Plan is no longer necessary
for the preservation of Tax Benefits, (vi) the beginning of a taxable year of the Company with respect to which the Board determines
that no Tax Benefits may be carried forward, or (vii) such time as the Board determines that a limitation on the use of the Tax
Benefits under Section 382 of the Code would no longer be material to the Company (the earliest of (i), through (vii) being herein
referred to as the “Expiration Date”). The Board shall at least annually consider whether to make the determination
provided by Section 7(a)(vii) hereof in light of all relevant factors, including, in particular, the amount and anticipated
utilization of the Company’s Tax Benefits and the Company’s market capitalization. The Company shall promptly notify
the Rights Agent in writing upon the occurrence of the Expiration Date and, if such notification is given orally, the Company shall
confirm same in writing on or prior to the Business Day next following. Until such notice is received by the Rights Agent, the
Rights Agent may presume conclusively for all purposes, prior to the Close of Business on September 19, that the Expiration Date
has not occurred. Except as set forth in Section 7(e) hereof and notwithstanding any other provision of this Agreement,
any Person who prior to the Distribution Date becomes a record holder of shares of Common Stock of the Company is entitled to all
of the rights of a registered holder of a Right Certificate with respect to the Rights associated with such shares of Common Stock
of the Company in accordance with the provisions of this Agreement, as of the date such Person becomes a record holder of shares
of Common Stock of the Company.

 

(b)          The
Exercise Price shall be payable in lawful money of the United States of America in accordance with Section 7(c) below.

 

    	12

    	 

    

 

(c)          As
promptly as practicable following the Distribution Date, the Company shall deposit with a corporation, trust, bank or similar institution
in good standing organized under the laws of the United States or any State of the United States, which is authorized under such
laws to exercise corporate trust or stock transfer powers and is subject to supervision or examination by a federal or state authority
(such institution is hereinafter referred to as the “Depositary Agent”), certificates representing the shares
of Preferred Stock that may be acquired upon exercise of the Rights and the Company shall cause such Depositary Agent to enter
into an agreement pursuant to which the Depositary Agent shall issue receipts representing interests in the shares of Preferred
Stock so deposited.  Upon receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase
and the certificate on the reverse side thereof duly executed, accompanied by payment of the Exercise Price for the shares to be
purchased and an amount equal to any applicable transfer tax (as determined by the Rights Agent) by certified check or bank draft
payable to the order of the Company or by money order, the Rights Agent shall, subject to Section 20(k) and Section 14(b) hereof,
thereupon promptly (i) requisition from the Depositary Agent (or make available, if the Rights Agent is the Depositary Agent)
depositary receipts or certificates for the number of one one-thousandths of a share of Preferred Stock to be purchased and the
Company hereby irrevocably authorizes the Depositary Agent to comply with all such requests, (ii) when appropriate, requisition
from the Company the amount of cash, if any, to be paid in lieu of issuance of fractional shares in accordance with Section 14
hereof, (iii) promptly after receipt of such certificates or depositary receipts, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate, registered in such name or names as may be designated by such holder
or in the case of Preferred Stock in Book Entry form, cause the same to be registered in Book Entry and (iv) when appropriate,
after receipt of each certificate or depositary receipts promptly deliver such cash to or upon the order of the registered holder
of such Right Certificate.  In the event that the Company is obligated to issue other securities (including Common Stock of
the Company) of the Company, pay cash or distribute other property pursuant to Section 11(a) hereof, the Company
will make all arrangements necessary so that such other securities, cash or other property are available for distribution by the
Rights Agent, if and when appropriate.  The payment of the Exercise Price may be made by certified or bank check payable to
the order of the Company, or by money order or wire transfer of immediately available funds to the account of the Company (provided
that notice of such wire transfer shall be given by the holder of the related Right to the Rights Agent).

 

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

 

(e)           Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence of a Section 11(a)(ii) Event or Section 13
Event, any Rights Beneficially Owned by (i) an Acquiring Person or any Associate or Affiliate of an Acquiring Person, (ii) a
transferee of an Acquiring Person (or of any Associate or Affiliate of an Acquiring Person) who becomes a transferee after the
Acquiring Person becomes such or (iii) a transferee of an Acquiring Person (or of any Associate or Affiliate of an Acquiring
Person) who becomes a transferee prior to or concurrently with the Acquiring Person becoming such and receives such Rights pursuant
to either (A) a transfer (whether or not for consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom the Acquiring Person has any continuing agreement, arrangement or understanding regarding
the transferred Rights, the shares of Common Stock of the Company associated with such Rights or the Company, or (B) a transfer
which the Board of Directors has determined is part of a plan, arrangement or understanding which has as a primary purpose or effect
the avoidance of this Section 7(e), shall be null and void without any further action and no holder of such Rights
shall have any rights whatsoever with respect to such Rights, whether under any provision of this Agreement or otherwise. 
The Company shall use all reasonable efforts to ensure that the provisions of this Section 7(e) and Section 4(b) hereof
are complied with, but shall have no liability to any holder of Right Certificates or other Person as a result of its failure to
make any determinations with respect to an Acquiring Person or any Affiliates or Associates of an Acquiring Person or any transferee
of any of them hereunder.

 

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(f)           Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action
with respect to a registered holder of Rights upon the occurrence of any purported exercise as set forth in this Section 7
unless such registered holder shall have (i) completed and signed the certificate contained in the form of election to purchase
set forth on the reverse side of the Right Certificate surrendered for such exercise, and (ii) provided such additional evidence
of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company shall reasonably
request.

 

Section 8.  Cancellation
and Destruction of Right Certificates.  All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or any of its agents, be delivered to the Rights Agent for cancellation
or in canceled form, or, if surrendered to the Rights Agent, shall be canceled by it, and no Right Certificates shall be issued
in lieu thereof except as expressly permitted by any of the provisions of this Agreement.  The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Right Certificate purchased
or acquired by the Company otherwise than upon the exercise thereof.  The Rights Agent shall deliver all canceled Right Certificates
to the Company, or shall, at the written request of the Company, destroy such cancelled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.

 

Section 9. Reservation and Availability
of Preferred Stock.

 

(a)          The
Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued shares of
preferred stock, the number of shares of Preferred Stock that will be sufficient to permit the exercise in full of all outstanding
and exercisable Rights.  Upon the occurrence of any events resulting in an increase in the aggregate number of shares of Preferred
Stock issuable upon exercise of all outstanding Rights in excess of the number then reserved, the Company shall make appropriate
increases in the number of shares so reserved.

 

(b)          The
Company shall use commercially reasonable efforts to cause, from and after such time as the Rights become exercisable, all shares
of Preferred Stock issued or reserved for issuance to be listed, upon official notice of issuance, upon the principal national
securities exchange, if any, upon which the Common Stock of the Company is listed or, if the principal market for the Common Stock
of the Company is not on any national securities exchange, to be eligible for quotation on such system as the Common Stock is then
quoted.

 

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(c)          The
Company shall use its best efforts to (i) file, as soon as practicable following the earliest date after the occurrence of
a Section 11(a)(ii) Event on which the consideration to be delivered by the Company upon exercise of the Rights has been
determined in accordance with Section 11(a)(iii) hereof, or as soon as required by law following the Distribution
Date, as the case may be, a registration statement under the Securities Act, with respect to the securities purchasable upon exercise
of the Rights on an appropriate form, (ii) cause such registration statement to become effective as soon as practicable after
such filing and (iii) cause such registration statement to remain effective (with a prospectus that at all times meets the
requirements of the Securities Act) until the earlier of (A) the date as of which the Rights are no longer exercisable for
such securities or (B) the Expiration Date.  The Company will also take such action as may be appropriate under, and
which will ensure compliance with, the securities or “blue sky” laws of the various states in connection with the exercisability
of the Rights.  The Company may temporarily suspend, for a period of time not to exceed one hundred twenty (120) days after
the date determined in accordance with the provisions of the first sentence of this Section 9(c), the exercisability
of the Rights in order to prepare and file such registration statement and permit it to become effective.  Upon such suspension,
the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is no longer in effect, in each case with prompt written notice to
the Rights Agent.  Notwithstanding any such provision of this Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction unless the requisite qualification in such jurisdiction shall have been obtained.

 

(d)          The
Company covenants and agrees that it will take all such action as may be necessary to ensure that all shares of Preferred Stock
delivered upon the exercise of the Rights shall, at the time of delivery of the certificates or depositary receipts for such shares
(subject to payment of the Exercise Price), be duly and validly authorized and issued and fully paid and nonassessable.

 

(e)          The
Company further covenants and agrees that it will pay when due and payable any and all federal and state transfer taxes and charges
which may be payable in respect of the issuance or delivery of the Right Certificates or of any certificates for shares of Preferred
Stock and/or other property upon the exercise of Rights.  The Company shall not, however, be required to pay any transfer
tax which may be payable in respect of any transfer or delivery of Right Certificates or the issuance or delivery of other securities
or property to a Person other than, or in respect of the issuance or delivery of securities or other property in a name other than
that of, the registered holder of the Right Certificates evidencing Rights surrendered for exercise or to issue or deliver any
certificates for securities or other property in a name other than that of the registered holder upon the exercise of any Rights
until such tax shall have been paid (any such tax being payable by the holder of such Right Certificate at the time of surrender)
or until it has been established to the Company’s satisfaction that no such tax is due.

 

Section 10. Preferred Stock Record Date. 
Each Person in whose name any certificate for Preferred Stock or other securities (including any fraction of a share of Preferred
Stock or such other securities) is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder
of record of the shares of Preferred Stock or such other securities represented thereby on, and such certificate shall be dated,
the date upon which the Right Certificate evidencing such Rights was duly surrendered and payment of the Exercise Price (and any
applicable transfer taxes) was made; provided, however, that if the date of such surrender and payment is a date
upon which the transfer books of the Company for the Preferred Stock or such other securities, as applicable, are closed, such
Person shall be deemed to have become the record holder of such shares of Preferred Stock or such other securities on, and such
certificate shall be dated, the next succeeding Business Day on which the transfer books of the Company are open; and further provided,
however, that if delivery of shares of Preferred Stock or such other securities is delayed pursuant to Section 9(c)
hereof, such Person shall be deemed to have become the record holder of such shares of Preferred Stock or such other securities
only when such shares or such other securities first become deliverable.  Prior to the exercise of the Right evidenced thereby,
the holder of a Right Certificate shall not be entitled to any rights of a stockholder of the Company with respect to shares for
which the Rights shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions
or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.

 

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Section 11. Adjustment of Exercise Price,
Number and Kind of Shares or Number of Rights.  The Exercise Price, the number and kind of shares covered by each Right
and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11.

 

(a)          (i)          In
the event the Company shall at any time after the date of this Agreement (A) declare a dividend on the Preferred Stock payable
in shares of Preferred Stock, (B) subdivide the outstanding Preferred Stock, (C) combine the outstanding Preferred Stock
into a smaller number of shares, or (D) issue, change or alter any shares of its stock in a reclassification or recapitalization
of the Preferred Stock (including any such reclassification or recapitalization in connection with a consolidation or merger in
which the Company is the continuing or surviving Person), except as otherwise provided in this Section 11(a) and
Section 7(e) hereof, the Exercise Price in effect at the time of the record date for such dividend or the effective
time of such subdivision, combination, reclassification or recapitalization, and the number and kind of shares of stock issuable
on such date or at such time, shall be proportionately adjusted so that the holder of any Right exercised after such time shall
be entitled to receive the aggregate number and kind of shares of stock which, if such Right had been exercised immediately prior
to such date and at a time when the Preferred Stock transfer books of the Company were open, such holder would have owned upon
such exercise and been entitled to receive by virtue of such dividend, subdivision, combination, reclassification or recapitalization;
provided, however, that in no event shall the consideration to be paid upon the exercise of a Right be less than
the aggregate par value of the shares of stock of the Company issuable upon exercise of a Right.  If an event occurs which
would require an adjustment under both Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment
provided for in this Section 11(a)(i) shall be in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii) hereof.

 

(ii)         Subject
to the provisions of Section 24 hereof, in the event any Person, alone or together with its Affiliates and Associates,
shall become an Acquiring Person, then, promptly following any such occurrence (a “Section 11(a)(ii) Event”),
proper provision shall be made so that each holder of a Right, except as provided in Section 7(e) hereof, shall
thereafter have a right to receive, upon exercise thereof at the then current Exercise Price in accordance with the terms of this
Agreement, in lieu of a number of one one-thousandths of a share of Preferred Stock, such number of shares of Common Stock of the
Company as shall equal the result obtained by (x) multiplying the then current Exercise Price by the then number of one one-thousandths
of a share of Preferred Stock for which a Right was exercisable immediately prior to the first occurrence of a Section 11(a)(ii) Event,
whether or not such Right was then exercisable, and dividing that product by (y) 50% of the Fair Market Value per share of
Common Stock of the Company (determined pursuant to Section 11(d)) on the date of the occurrence of a Section 11(a)(ii) Event
(such number of shares being referred to as the “Adjustment Shares”).

 

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(iii)        In
lieu of issuing any shares of Common Stock of the Company in accordance with Section 11(a)(ii) hereof, the Company,
acting by or pursuant to a resolution of the Board of Directors, may, and in the event that the number of shares of Common Stock
of the Company which are authorized by the Company’s Charter but not outstanding or reserved for issuance for purposes other
than upon exercise of the Rights is not sufficient to permit the exercise in full of the Rights in accordance with the foregoing
subparagraph (ii) of this Section 11(a), the Company, acting by or pursuant to a resolution of the Board of Directors,
shall:  (A) determine the excess of (X) the Fair Market Value of the Adjustment Shares issuable upon the exercise
of a Right (the “Current Value”) over (Y) the Exercise Price attributable to each Right (such excess being
referred to as the “Spread”) and (B) with respect to all or a portion of each Right (subject to Section 7(e) hereof),
make adequate provision to substitute for the Adjustment Shares, upon payment of the applicable Exercise Price, (1) Common
Stock of the Company or equity securities, if any, of the Company other than Common Stock of the Company (including without limitation
shares, or units of shares, of preferred stock, such as the Preferred Stock, that the Board of Directors has determined to have
the same value as shares of  Common Stock of the Company (such shares of preferred stock being referred to herein as “Common
Stock Equivalents”)), (2) cash, (3) a reduction in the Exercise Price, (4) Preferred Stock Equivalents
which the Board of Directors has deemed to have the same value as shares of Common Stock of the Company, (5) debt securities
of the Company, (6) other assets or securities of the Company or (7) any combination of the foregoing, having an aggregate
value equal to the Current Value, where such aggregate value has been determined by the Board of Directors after receiving the
advice of a nationally recognized investment banking firm selected by the Board of Directors; provided, however,
that if the Company shall not have made adequate provision to deliver value pursuant to clause (B) above within thirty (30)
days following the later of (x) the first occurrence of a Section 11(a)(ii) Event and (y) the date on which
the Company’s right of redemption pursuant to Section 23(a) expires (the later of (x) and (y) being
referred to herein as the “Section 11(a)(ii) Trigger Date”), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without requiring payment of the Exercise Price, shares of Common Stock
of the Company (to the extent available) and then, if necessary, cash, which shares and/or cash have an aggregate value equal to
the Spread.  If the Board of Directors shall determine in good faith that it is likely that sufficient additional shares of
Common Stock of the Company could be authorized for issuance upon exercise in full of the Rights, the 30-day period set forth above
may be extended to the extent necessary, but not more than ninety (90) days after the Section 11(a)(ii) Trigger Date,
in order that the Company may seek stockholder approval for the authorization of such additional shares (such period, as it may
be extended, being referred to herein as the “Substitution Period”).  To the extent that the Company determines
that some action need be taken pursuant to the first and/or second sentences of this Section 11(a)(iii), the Company
(x) shall provide, subject to Section 7(e) hereof, that such action shall apply uniformly to all outstanding
Rights and (y) may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek
any authorization of additional shares and/or to decide the appropriate form of distribution to be made pursuant to such first
sentence and to determine the value thereof.  In the event of any such suspension, the Company shall issue a public announcement
stating that the exercisability of the Rights has been temporarily suspended and a public announcement at such time as the suspension
is no longer in effect.   For purposes of this Section 11(a)(iii), the value of the Common Stock of the Company
and of the Preferred Stock shall be the Fair Market Value (as determined pursuant to Section 11(d) hereof) per
share of the Common Stock of the Company and the Preferred Stock, respectively, on the Section 11(a)(ii) Trigger Date,
the value of any Common Stock Equivalent shall be deemed to have the same value as the Common Stock of the Company on such date
and the value of any Preferred Stock Equivalent shall be deemed to have the same value as the Preferred Stock on such date.

 

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(b)          If
the Company shall fix a record date for the issuance of rights, options or warrants to all holders of Preferred Stock entitling
them (for a period expiring within forty-five (45) calendar days after such record date) to subscribe for or purchase Preferred
Stock (or securities having the same or more favorable rights, privileges and preferences as the shares of Preferred Stock (“Preferred
Stock Equivalents”)) or securities convertible into Preferred Stock or Preferred Stock Equivalents at a price per share
of Preferred Stock or per share of Preferred Stock Equivalents (or having a conversion price per share, if a security convertible
into Preferred Stock or Preferred Stock Equivalents) less than the Fair Market Value (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock on such record date, the Exercise Price to be in effect after such record date shall be determined
by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be
the number of shares of Preferred Stock outstanding on such record date, plus the number of shares of Preferred Stock which the
aggregate offering price of the total number of shares of Preferred Stock and/or Preferred Stock Equivalents to be offered (and
the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such Fair Market Value
and the denominator of which shall be the number of shares of Preferred Stock outstanding on such record date, plus the number
of additional shares of Preferred Stock and Preferred Stock Equivalents to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible); provided, however, that in no event shall
the consideration to be paid upon the exercise of a Right be less than the aggregate par value of the shares of stock of the Company
issuable upon exercise of a Right.  In case such subscription price may be paid in a consideration part or all of which shall
be in a form other than cash, the value of such consideration shall be the Fair Market Value thereof determined in accordance with
Section 11(d) hereof.  Shares of Preferred Stock owned by or held for the account of the Company shall not
be deemed outstanding for the purpose of any such computation.  Such adjustments shall be made successively whenever such
a record date is fixed; and in the event that such rights or warrants are not so issued, the Exercise Price shall be adjusted to
be the Exercise Price which would then be in effect if such record date had not been fixed.

 

(c)          If
the Company shall fix a record date for the making of a distribution to all holders of Preferred Stock (including any such distribution
made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation), of evidences
of indebtedness, cash (other than a regular periodic cash dividend out of the earnings or retained earnings of the Company), assets
(other than a dividend payable in Preferred Stock, but including any dividend payable in stock other than Preferred Stock) or convertible
securities, subscription rights or warrants (excluding those referred to in Section 11(b)), the Exercise Price to be
in effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record
date by a fraction, the numerator of which shall be the Fair Market Value (as determined pursuant to Section 11(d) hereof)
per one one-thousandth of a share of Preferred Stock on such record date, less the Fair Market Value (as determined pursuant to
Section 11(d) hereof) of the portion of the cash, assets or evidences of indebtedness so to be distributed or
of such convertible securities, subscription rights or warrants applicable to one one-thousandth of a share of Preferred Stock
and the denominator of which shall be the Fair Market Value (as determined pursuant to Section 11(d) hereof) per
one one-thousandth of a share of Preferred Stock; provided, however, that in no event shall the consideration to
be paid upon the exercise of a Right be less than the aggregate par value of the shares of stock of the Company issuable upon exercise
of a Right.  Such adjustments shall be made successively whenever such a record date is fixed; and in the event that such
distribution is not so made, the Exercise Price shall again be adjusted to be the Exercise Price which would be in effect if such
record date had not been fixed.

 

(d)          For
the purpose of this Agreement, the “Fair Market Value” of any share of Preferred Stock, Common Stock or any
other stock or any Right or other security or any other property shall be determined as provided in this Section 11(d).

 

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(i)          In
the case of a publicly-traded stock or other security, the Fair Market Value on any date shall be deemed to be the average of the
daily closing prices per share of such stock or per unit of such other security for the 30 consecutive Trading Days (as such term
is hereinafter defined) immediately prior to such date; provided, however, that in the event that the Fair Market
Value per share of any share of stock is determined during a period following the announcement by the issuer of such stock of (x) a
dividend or distribution on such stock payable in shares of such stock or securities convertible into shares of such stock or (y) any
subdivision, combination or reclassification of such stock, and prior to the expiration of the 30 Trading Day period after the
ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination or reclassification, then,
and in each such case, the Fair Market Value shall be properly adjusted to take into account ex-dividend trading.  The closing
price for each day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of
the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New York Stock Exchange or, if the securities are not listed or
admitted to trading on the New York Stock Exchange, as reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange on which such security is listed or admitted to trading;
or, if not listed or admitted to trading on any national securities exchange, the last quoted price (or, if not so quoted, the
average of the last quoted high bid and low asked prices) in the over-the-counter market, as reported by the OTC Bulletin Board,
the Pink Sheets or such other system then in use; or, if on any such date no bids for such security are quoted by any such organization,
the average of the closing bid and asked prices as furnished by a professional market maker making a market in such security selected
by the Board of Directors.  If on any such date no market maker is making a market in such security, the Fair Market Value
of such security on such date shall be determined reasonably and with utmost good faith to the holders of the Rights by the Board
of Directors; provided, however, that if at the time of such determination there is an Acquiring Person, the Fair
Market Value of such security on such date shall be determined by a nationally recognized investment banking firm selected by the
Board of Directors, which determination shall be described in a statement filed with the Rights Agent and shall be binding on the
Rights Agent and the holders of the Rights.  The term “Trading Day” shall mean a day on which the principal
national securities exchange on which such security is listed or admitted to trading is open for the transaction of business or,
if such security is not listed or admitted to trading on any national securities exchange, a Business Day.

 

(ii)         If
a security is not publicly held or not so listed or traded, “Fair Market Value” shall mean the fair value per
share of stock or per other unit of such security, determined reasonably and in good faith to the holders of the Rights by the
Board of Directors; provided, however, that if at the time of such determination there is an Acquiring Person, the
Fair Market Value of such security on such date shall be determined by a nationally recognized investment banking firm selected
by the Board of Directors, which determination shall be described in a statement filed with the Rights Agent and shall be binding
on the Rights Agent and the holders of the Rights; provided, however, that for the purposes of making any adjustment
provided for by Section 11(a)(ii) hereof, the Fair Market Value of a share of Preferred Stock shall not be less
than the product of the then Fair Market Value of a share of Common Stock multiplied by the higher of the then Dividend Multiple
or Vote Multiple (as both of such terms are defined in the articles of amendment attached as Exhibit A hereto) applicable
to the Preferred Stock and shall not exceed 105% of the product of the then Fair Market Value of a share of Common Stock multiplied
by the higher of the then Dividend Multiple or Vote Multiple applicable to the Preferred Stock.

 

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(iii)        In
the case of property other than securities, the Fair Market Value thereof shall be determined reasonably and in good faith to the
holders of Rights by the Board of Directors; provided, however, that if at the time of such determination there is
an Acquiring Person, the Fair Market Value of such property on such date shall be determined by a nationally recognized investment
banking firm selected by the Board of Directors, which determination shall be described in a statement filed with the Rights Agent
and shall be binding upon the Rights Agent and the holders of the Rights.

 

(e)          Anything
herein to the contrary notwithstanding, no adjustment in the Exercise Price shall be required unless such adjustment would require
an increase or decrease of at least 1.0% in the Exercise Price; provided, however, that any adjustments which by
reason of this Section 11(e) are not required to be made shall be carried forward and taken into account in any
subsequent adjustment.  All calculations under this Section 11 shall be made to the nearest cent or to the nearest
one-millionth of a share of Common Stock of the Company or hundred-millionth of a share of Preferred Stock, as the case may be,
or to such other figure as the Board of Directors may deem appropriate.  Notwithstanding the first sentence of this Section 11(e),
any adjustment required by this Section 11 shall be made no later than the earlier of (i) three (3) years
from the date of the transaction which mandates such adjustment or (ii) the Expiration Date.

 

(f)          If
as a result of any provision of Section 11(a) or Section 13(a) hereof, the holder of any Right
thereafter exercised shall become entitled to receive any shares of stock of the Company other than Preferred Stock, thereafter
the number of such other shares so receivable upon exercise of any Right 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 Preferred Stock contained in Section 11(a),
(b), (c), (d), (e), (g) through (k) and (m), inclusive, and the provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the Preferred Stock shall apply on like terms to any such other shares.

 

(g)          All
Rights originally issued by the Company subsequent to any adjustment made to the Exercise Price hereunder shall evidence the right
to purchase, at the adjusted Exercise Price, the number of one one-thousandths of a share of Preferred Stock (or other securities
or amount of cash or combination thereof) purchasable from time to time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.

 

(h)          Unless
the Company shall have exercised its election as provided in Section 11(i), upon each adjustment of the Exercise Price
as a result of the calculations made in Section 11(b) and (c), each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of one one-thousandths
of a share of Preferred Stock (calculated to the nearest hundred-millionth) as the Board of Directors determines is appropriate
to preserve the economic value of the Rights, including, by way of example, that number obtained by (i) multiplying (x) the
number of one one-thousandths of a share of Preferred Stock for which a Right may be exercisable immediately prior to this adjustment
by (y) the Exercise Price in effect immediately prior to such adjustment of the Exercise Price and (ii) dividing the
product so obtained by the Exercise Price in effect immediately after such adjustment of the Exercise Price.

 

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(i)          The
Company may elect on or after the date of any adjustment of the Exercise Price to adjust the number of Rights, in substitution
for any adjustment in the number of shares of Preferred Stock purchasable upon the exercise of a Right.  Each of the Rights
outstanding after the adjustment in the number of Rights shall be exercisable for the number of one one-thousandths of a share
of Preferred Stock for which a Right was exercisable immediately prior to such adjustment.  Each Right held of record prior
to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one-millionth) obtained
by dividing the Exercise Price in effect immediately prior to adjustment of the Exercise Price by the Exercise Price in effect
immediately after adjustment of the Exercise Price.  The Company shall make a public announcement of its election to adjust
the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to
be made.  This record date may be the date on which the Exercise Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least ten (10) days later than the date of the public announcement.  If Right
Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(i), the Company
shall, as promptly as practicable, cause to be distributed to holders of record of Right Certificates on such record date Right
Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution
and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment. 
Right Certificates so to be distributed shall be issued, executed and countersigned in the manner provided for herein (and may
bear, at the option of the Company, the adjusted Exercise Price) and shall be registered in the names of the holders of record
of Right Certificates on the record date specified in the public announcement.

 

(j)          Irrespective
of any adjustment or change in the Exercise Price or the number of one one-thousandths of a share of Preferred Stock issuable upon
the exercise of the Rights, the Right Certificates theretofore and thereafter issued may continue to express the Exercise Price
per share and the number of shares which were expressed in the initial Right Certificates issued hereunder without prejudice to
any adjustment or change.

 

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

 

(l)          In
any case in which this Section 11 shall require that an adjustment in the Exercise Price be made effective as of a
record date for a specified event, the Company may elect to defer until the occurrence of such event the issuing to the holder
of any Right exercised after such record date the number of one one-thousandths of a share of Preferred Stock or other stock or
securities of the Company, if any, issuable upon such exercise over and above the number of one one-thousandths of a share of Preferred
Stock and other stock or securities of the Company, if any, issuable upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder’s right to receive such additional shares upon the occurrence of the event requiring such
adjustment.

 

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(m)          Anything
in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Exercise
Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that in its good
faith judgment the Board of Directors shall determine to be advisable in order that any consolidation or subdivision of the Preferred
Stock, issuance wholly for cash of any shares of Preferred Stock at less than the Fair Market Value, issuance wholly for cash of
shares of Preferred Stock or securities which by their terms are convertible into or exchangeable for shares of Preferred Stock,
stock dividends or issuance of rights, options or warrants referred to hereinabove in this Section 11, hereafter made
by the Company to holders of its Preferred Stock, shall not be taxable to such stockholders.

 

(n)          The
Company covenants and agrees that it shall not, at any time after the Distribution Date and so long as the Rights have not been
redeemed pursuant to Section 23 hereof or exchanged pursuant to Section 24 hereof, (i) consolidate
with (other than a Subsidiary of the Company in a transaction that complies with the proviso at the end of this sentence), (ii) merge
with or into, or (iii) sell or transfer (or permit any Subsidiary to sell or transfer), in one transaction or a series of
related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries
taken as a whole, to any other Person or Persons (other than the Company and/or any of its Subsidiaries in one or more transactions
each of which complies with the proviso at the end of this sentence) if (x) at the time of or immediately after such consolidation,
merger or sale there are any rights, warrants or other instruments outstanding or agreements or arrangements in effect which would
substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights, or (y) prior to, simultaneously
with or immediately after such consolidation, merger or sale the stockholders of a Person who constitutes, or would constitute,
the “Principal Party” for the purposes of Section 13(a) hereof shall have received a distribution
of Rights previously owned by such Person or any of its Affiliates and Associates; provided, however, that, subject
to the following sentence, this Section 11(n) shall not affect the ability of any Subsidiary of the Company to
consolidate with, or merge with or into, or sell or transfer assets or earning power to, any other Subsidiary of the Company. 
The Company further covenants and agrees that after the Distribution Date it will not, except as permitted by Section 23
or Section 27 hereof, take (or permit any Subsidiary to take) any action if at the time such action is taken it is
reasonably foreseeable that such action will substantially diminish or otherwise eliminate the benefits intended to be afforded
by the Rights.

 

(o)          Notwithstanding
anything in this Agreement to the contrary, in the event the Company shall at any time after the date of this Agreement and prior
to the Distribution Date (i) declare or pay any dividend on the outstanding Common Stock of the Company payable in shares
of Common Stock of the Company or (ii) effect a subdivision, combination or consolidation of the outstanding shares of Common
Stock of the Company (by reclassification or otherwise than by payment of dividends in shares of Common Stock of the Company) into
a greater or lesser number of shares of Common Stock of the Company, then in any such case (A) the number of one one-thousandths
of a share of Preferred Stock purchasable after such event upon proper exercise of each Right shall be determined by multiplying
the number of one one-thousandths of a share of Preferred Stock so purchasable immediately prior to such event by a fraction, the
numerator of which is the number of shares of Common Stock of the Company outstanding immediately prior to such event and the denominator
of which is the number of shares of Common Stock of the Company outstanding immediately after such event, and (B) each share
of Common Stock of the Company outstanding immediately after such event shall have issued with respect to it that number of Rights
which each share of Common Stock of the Company outstanding immediately prior to such event had issued with respect to it. 
The adjustments provided for in this Section 11(o) shall be made successively whenever such a dividend is declared
or paid or such a subdivision, combination or consolidation is effected.

 

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(p)          The
exercise of Rights under Section 11(a)(ii) hereof shall only result in the loss of rights under Section 11(a)(ii) hereof
to the extent so exercised and neither such exercise nor any exchange of Rights pursuant to Section 24 hereof shall
otherwise affect the rights of holders of Right Certificates under this Rights Agreement, including rights to purchase securities
of the Principal Party following a Section 13 Event which has occurred or may thereafter occur, as set forth in Section 13
hereof.  Upon exercise of a Right Certificate under Section 11(a)(ii), the Rights Agent shall return such Right
Certificate duly marked to indicate that such exercise has occurred.

 

Section 12. Certificate of Adjusted Exercise
Price or Number of Shares.  Whenever an adjustment is made as provided in Section 11 or Section 13
hereof, the Company shall (a) promptly prepare a certificate setting forth such adjustment and a brief statement of the facts
accounting for such adjustment, (b) promptly file with the Rights Agent and with each transfer agent for the Preferred Stock
and the Common Stock of the Company a copy of such certificate and (c) mail a brief summary thereof to each holder of a Right
Certificate (or, if prior to the Distribution Date, to each holder of a certificate representing shares of Common Stock of the
Company) in accordance with Section 26 hereof.  The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment contained therein and shall not be deemed to have knowledge of any such adjustment unless and
until it shall have received such certificate.

 

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

 

(a)          In
the event that, following the Stock Acquisition Date, directly or indirectly, (x) the Company shall consolidate with, or merge
with and into, any other Person (other than a Subsidiary of the Company in a transaction which is not prohibited by Section 11(n) hereof),
and the Company shall not be the continuing or surviving corporation of such consolidation or merger, (y) any Person (other
than a Subsidiary of the Company in a transaction which is not prohibited by the proviso at the end of the first sentence of Section 11(n) hereof)
shall consolidate with the Company, or merge with and into the Company and the Company shall be the continuing or surviving corporation
of such merger and, in connection with such merger, all or part of the shares of Common Stock of the Company shall be changed into
or exchanged for stock or other securities of any other Person or cash or any other property, or (z) the Company shall sell,
mortgage or otherwise transfer (or one or more of its Subsidiaries shall sell, mortgage or otherwise transfer), in one transaction
or a series of related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to any other Person or Persons (other than the Company or any Subsidiary of the Company
in one or more transactions, each of which is not prohibited by the proviso at the end of the first sentence of Section 11(n) hereof),
then, and in each such case, proper provision shall be made so that:  (i) each holder of a Right, except as provided
in Section 7(e) hereof, shall have the right to receive, upon the exercise thereof at the then current Exercise
Price in accordance with the terms of this Agreement, such number of validly authorized and issued, fully paid and nonassessable
shares of freely tradable Common Stock of the Principal Party (as hereinafter defined in Section 13(b) below), free
and clear of rights of call or first refusal, liens, encumbrances, transfer restrictions or other adverse claims, as shall be equal
to the result obtained by (1) multiplying the then current Exercise Price by the number of one one-thousandths of a share
of Preferred Stock for which a Right is exercisable immediately prior to the first occurrence of a Section 13 Event (without
taking into account any adjustment previously made pursuant to Section 11(a)(ii) or Section 11(a)(iii) hereof),
and dividing that product by (2) 50% of the Fair Market Value (determined pursuant to Section 11(d) hereof)
per share of the Common Stock of such Principal Party on the date of consummation of such consolidation, merger, sale or transfer;
(ii) such Principal Party shall thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale,
mortgage or transfer, all the obligations and duties of the Company pursuant to this Agreement; (iii) the term “Company”
shall thereafter be deemed to refer to such Principal Party, it being specifically intended that the provisions of Section 11
hereof shall apply to such Principal Party; and (iv) such Principal Party shall take such steps (including, but not limited
to, the reservation of a sufficient number of shares of its Common Stock to permit exercise of all outstanding Rights in accordance
with this Section 13(a) and the making of payments in cash and/or other securities in accordance with Section 11(a)(iii) hereof)
in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter be applicable, as
nearly as reasonably may be, in relation to its shares of Common Stock thereafter deliverable upon the exercise of the Rights.

 

    	23

    	 

    

 

(b)          “Principal
Party” shall mean

 

(i)          in
the case of any transaction described in clause (x) or (y) of the first sentence of Section 13(a) hereof,
the Person that is the issuer of any securities into which shares of Common Stock of the Company are converted in such merger or
consolidation, or, if there is more than one such issuer, the issuer of Common Stock that has the highest aggregate Fair Market
Value (determined pursuant to Section 11(d) hereof), and if no securities are so issued, the Person that is the other
party to the merger or consolidation, or, if there is more than one such Person, the Person the Common Stock of which has the highest
aggregate Fair Market Value (determined pursuant to Section 11(d) hereof); and

 

(ii)         in
the case of any transaction described in clause (z) of the first sentence of Section 13(a) hereof, the Person
that is the party receiving the greatest portion of the assets or earning power transferred pursuant to such transaction or transactions,
or, if each Person that is a party to such transaction or transactions receives the same portion of the assets or earning power
transferred pursuant to such transaction or transactions or if the Person receiving the largest portion of the assets or earning
power cannot be determined, whichever Person the Common Stock of which has the highest aggregate Fair Market Value (determined
pursuant to Section 11(d) hereof);

 

provided, however, that in
any such case described in clauses (i) or (ii) of this Section 13(b) hereof, (1) if the Common
Stock of such Person is not at such time and has not been continuously over the preceding 12-month period registered under Section 12
of the Exchange Act (“Registered Common Stock”) or such Person is not a corporation, and such Person is a direct
or indirect Subsidiary or Affiliate of another Person who has Registered Common Stock outstanding, “Principal Party”
shall refer to such other Person; (2) if the Common Stock of such Person is not Registered Common Stock or such Person is
not a corporation, and such Person is a direct or indirect Subsidiary of another Person but is not a direct or indirect Subsidiary
of another Person which has Registered Common Stock outstanding, “Principal Party” shall refer to the ultimate parent
entity of such first-mentioned Person; (3) if the Common Stock of such Person is not Registered Common Stock or such Person
is not a corporation, and such Person is directly or indirectly controlled by more than one Person, and one or more of such other
Persons has Registered Common Stock outstanding, “Principal Party” shall refer to whichever of such other Persons is
the issuer of the Registered Common Stock having the highest aggregate Fair Market Value (determined pursuant to Section 11(d)
hereof); and (4) if the Common Stock of such Person is not Registered Common Stock or such Person is not a corporation, and
such Person is directly or indirectly controlled by more than one Person, and none of such other Persons has Registered Common
Stock outstanding, “Principal Party” shall refer to whichever ultimate parent entity is the corporation having the
greatest stockholders’ equity or, if no such ultimate parent entity is a corporation, “Principal Party” shall
refer to whichever ultimate parent entity is the entity having the greatest net assets.

 

    	24

    	 

    

 

(c)          The
Company shall not consummate any such consolidation, merger, sale or transfer unless prior thereto (x) the Principal Party
shall have a sufficient number of authorized shares of its Common Stock, which have not been issued or reserved for issuance, to
permit the exercise in full of the Rights in accordance with this Section 13, and (y) the Company and each Principal
Party and each other Person who may become a Principal Party as a result of such consolidation, merger, sale or transfer shall
have executed and delivered to the Rights Agent a supplemental agreement providing for the terms set forth in Section 13(a) and
(b) hereof and further providing that, as soon as practicable after the date of any consolidation, merger, sale or transfer
of assets mentioned in Section 13(a) hereof, the Principal Party at its own expense will:

 

(i)          prepare
and file a registration statement under the Securities Act with respect to the Rights and the securities purchasable upon exercise
of the Rights on an appropriate form, cause such registration statement to become effective as soon as practicable after such filing
and cause such registration statement to remain effective (with a prospectus that at all times meets the requirements of the Securities
Act) until the Expiration Date;

 

(ii)         qualify
or register the Rights and the securities purchasable upon exercise of the Rights under the blue sky laws of such jurisdictions
as may be necessary or appropriate;

 

(iii)        list
(or continue the listing of) the Rights and the securities purchasable upon exercise of the Rights on a national securities exchange
or meet the eligibility requirements for listing on an automated quotation system or such other system on which the Common Stock
of the Company is then traded; and

 

(iv)        deliver
to holders of the Rights historical financial statements for the Principal Party and each of its Affiliates which comply in all
respects with the requirements for registration on Form 10 under the Exchange Act.

 

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

 

    	25

    	 

    

 

 The provisions of this Section 13
shall similarly apply to successive mergers or consolidations or sales or other transfers.

 

Section 14. Fractional Rights and Fractional
Shares.

 

(a)          The
Company shall not be required to issue fractions of Rights, except prior to the Distribution Date as provided in Section 11(o) hereof,
or to distribute Right Certificates which evidence fractional Rights.  If the Company elects not to issue such fractional
Rights, the Company shall pay, in lieu of such fractional Rights, to the registered holders of the Right Certificates with regard
to which such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the Fair Market Value
of a whole Right, as determined pursuant to Section 11(d) hereof.

 

(b)          The
Company shall not be required to issue fractions of shares of Preferred Stock (other than fractions which are integral multiples
of one one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to distribute certificates or register Book
Entry fractional Preferred Stock which evidence fractional shares of Preferred Stock (other than fractions which are integral multiples
of one one-thousandth of a share of Preferred Stock).  In lieu of fractional shares of Preferred Stock that are not integral
multiples of one one-thousandth of a share of Preferred Stock, the Company may pay to the registered holders of Right Certificates
at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the Fair Market Value
of one one-thousandth of a share of Preferred Stock.  For purposes of this Section 14(b), the Fair Market Value
of one one-thousandth of a share of Preferred Stock shall be determined pursuant to Section 11(d) hereof for the
Trading Day immediately prior to the date of such exercise.

 

(c)          The
holder of a Right by the acceptance of the Rights expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right, except as permitted by this Section 14.

 

Section 15. Rights of Action. 
All rights of action in respect of this Agreement, other than rights of action vested in the Rights Agent pursuant to Section
18 and Section 20 hereof, are vested in the respective registered holders of the Right Certificates (or, prior to the
Distribution Date, the registered holders of the Common Stock of the Company); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Stock of the Company), without the consent of the Rights Agent or of the holder
of any other Right Certificate (or, prior to the Distribution Date, of the Common Stock of the Company), may, in such registered
holder’s own behalf and for such registered holder’s own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise act in respect of, his right to exercise the Right evidenced
by such Right Certificate in the manner provided in such Right Certificate and in this Agreement.  Without limiting the foregoing
or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an
adequate remedy at law for any breach of this Agreement and shall be entitled to specific performance of the obligations hereunder
and injunctive relief against actual or threatened violations of the obligations hereunder of any Person subject to this Agreement. 
Holders of Rights shall be entitled to recover the reasonable costs and expenses, including attorneys’ fees, incurred by
them in any action to enforce the provisions of this Agreement.

 

    	26

    	 

    

 

Section 16. Agreement of Right Holders. 
Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other
holder of a Right that:

 

(a)          prior
to the Distribution Date, each Right will be transferable only simultaneously and together with the transfer of shares of Common
Stock of the Company;

 

(b)          after
the Distribution Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at
the office or offices of the Rights Agent designated for such purpose, duly endorsed or accompanied by a proper instrument of transfer;

 

(c)          subject
to Section 6(a) and Section 7(f) hereof, the Company and the Rights Agent may deem and treat the person in whose
name a Right Certificate (or, prior to the Distribution Date, the associated certificate representing Common Stock of the Company
or the Ownership Statements or other notices provided to holders of Book Entry Common Stock) is registered as the absolute owner
thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificates or
the associated certificate representing Common Stock of the Company (or Ownership Statements or other notices provided to holders
of Book Entry Common Stock) made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and, subject
to the last sentence of Section 7(e) hereof, neither the Company nor the Rights Agent shall be affected by any notice
to the contrary; and

 

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

 

Section 17. Right Certificate Holder
Not Deemed a Stockholder.  No holder, as such, of any Right Certificate shall be entitled to vote, receive dividends or
be deemed for any purpose the holder of the shares of Preferred Stock or any other securities of the Company which may at any time
be issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or in any Right Certificate
be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a stockholder of the Company or
any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give
or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as
provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with the provisions hereof.

 

    	27

    	 

    

  

Section 18. Concerning the Rights Agent.

 

(a)          The
Company agrees to pay to the Rights Agent such compensation as shall be agreed to in writing between the Company and the Rights
Agent for all services rendered by it hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses
and attorney fees and disbursements and other disbursements incurred in the administration and execution of this Agreement and
the exercise and performance of its duties hereunder.  The Company also agrees to indemnify the Rights Agent for, and to hold
it harmless against, any loss, liability, or expense, incurred without gross negligence, bad faith or willful misconduct (which
gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling
of a court of competent jurisdiction) on the part of the Rights Agent, for anything done or omitted by the Rights Agent in connection
with the acceptance and administration of this Agreement, including the costs and expenses of defending against any claim of liability
arising therefrom, directly or indirectly.  The provisions of this Section 18(a) shall survive the expiration
of the Rights and the termination of this Agreement.

 

(b)          The
Rights Agent shall be protected and shall incur no liability for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any Right Certificate or certificate representing Common
Stock of the Company, Preferred Stock, or other securities of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or other paper or document believed by it in
good faith and without gross negligence to be genuine and to be signed and executed by the proper Person or Persons.

 

(c)          The
Rights Agent shall not be liable for consequential damages under any provision of this Agreement or for any special, indirect or
consequential damages of any kind whatsoever (including but not limited to lost profits) arising out of any act or failure to act
hereunder even if the Rights Agent has been advised of the likelihood of such damages and regardless of the form of action. Any
liability of the Rights Agent under this Agreement will be limited to the amount of fees paid by the Company to the Rights Agent.

 

Section 19. Merger or Consolidation or
Change of Name of Rights Agent.

 

(a)          Any
corporation into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party,
or any corporation succeeding to the corporate trust or stockholder services business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further
act on the part of any of the parties hereto, provided that such corporation would be eligible for appointment as
a successor Rights Agent under the provisions of Section 21 hereof.  In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the name of the predecessor or in the name of the successor Rights
Agent; and in all such cases such Right Certificates shall have the full force provided in the Right Certificates and in this Agreement.

 

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

 

    	28

    	 

    

 

Section 20. Duties of Rights Agent. 
The Rights Agent undertakes the duties and obligations expressly imposed by this Agreement upon the following terms and conditions,
by all of which the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound:

 

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

 

(b)          Whenever
in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person and the determination of “Fair Market Value”)
be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence
in respect thereof shall be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate
signed by a person believed by the Rights Agent to be the Chairman of the Board of Directors, a Vice Chairman of the Board of Directors,
the President, a Vice President, the Treasurer, any Assistant Treasurer, the Secretary or an Assistant Secretary of the Company
and delivered to the Rights Agent.  Any such certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in reliance upon such certificate.

 

(c)          The
Rights Agent shall be liable hereunder only for its own gross negligence, bad faith or willful misconduct (which gross negligence,
bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction).

 

(d)          The
Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in
the Right Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals
are and shall be deemed to have been made by the Company only.

 

(e)          The
Rights Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained
in this Agreement or in any Right Certificate; nor shall it be responsible for any change in the exercisability of the Rights (including
the Rights becoming void pursuant to Section 7(e) hereof) or any adjustment required under the provisions of Section 11,
Section 13 or Section 24(c) hereof or responsible for the manner, method or amount of any such adjustment or
the ascertaining of the existence of facts that would require any such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after receipt of a certificate describing any such adjustment furnished in accordance with Section 12
hereof), nor shall it be responsible for any determination by the Board of Directors of the Fair Market Value of the Rights or
Preferred Stock pursuant to the provisions of Section 14 hereof; nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any shares of Common Stock of the Company or Preferred
Stock to be issued pursuant to this Agreement or any Right Certificate or as to whether or not any shares of Common Stock of the
Company or Preferred Stock will, when so issued, be validly authorized and issued, fully paid and nonassessable.

 

    	29

    	 

    

 

(f)          The
Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered
all such further and other acts, instruments and assurances as may reasonably be required by the Rights Agent for the carrying
out or performing by the Rights Agent of the provisions of this Agreement.

 

(g)          The
Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder and
certificates delivered pursuant to any provision hereof from any person believed by the Rights Agent to be the Chairman of the
Board of Directors, any Vice Chairman of the Board of Directors, the President, a Vice President, the Secretary, an Assistant Secretary,
the Treasurer or an Assistant Treasurer of the Company, and is authorized to apply to such officers for advice or instructions
in connection with its duties, and it shall not be liable for any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer.  Any application by the Rights Agent for written instructions from the Company may,
at the option of the Rights Agent, set forth in writing any action proposed to be taken or omitted by the Rights Agent under this
Agreement and the date on or after which such action shall be taken or such omission shall be effective.  The Rights Agent
shall not be liable for any action taken by, or omission of, the Rights Agent in accordance with a proposal included in such application
on or after the date specified in such application (which date shall not be less than five Business Days after the date any officer
of the Company actually receives such application, unless any such officer shall have consented in writing to an earlier date)
unless, prior to taking any such action (or the effective date in the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying the action to be taken or omitted.

 

(h)          The
Rights Agent and any stockholder, director, officer or employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested,
or contract with or lend money to the Company or otherwise act as fully and freely as though it were not the Rights Agent under
this Agreement.  Nothing herein shall preclude the Rights Agent from acting in any other capacity for the Company or for any
other legal entity.

 

(i)          The
Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents.

 

(j)          No
provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its rights if there shall be reasonable grounds for believing
that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.

 

(k)          If,
with respect to any Right Certificate surrendered to the Rights Agent for exercise or transfer, the certificate attached to the
form of assignment or form of election to purchase, as the case may be, has either not been completed or indicates an affirmative
response to clause (1) or clause (2) thereof, the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.

 

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Section 21. Change of Rights Agent. 
The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement upon thirty (30)
days’ notice in writing mailed to the Company by first class mail, provided, however, that in the event the
transfer agency relationship in effect between the Company and the Rights Agent with respect to the Common Stock of the Company
terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties under this Agreement
on the effective date of such termination and the Company shall be responsible for sending any required notice.  The Company
may remove the Rights Agent or any successor Rights Agent (with or without cause), effective immediately or on a specified date,
by written notice given to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common
Stock of the Company and Preferred Stock, and by giving notice to the holders of the Right Certificates by any means reasonably
determined by the Company to inform such holders of such removal (including without limitation, by including such information in
one or more of the Company’s reports to stockholders or reports or filings with the Securities and Exchange Commission). 
If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor
to the Rights Agent.  If the Company shall fail to make such appointment within a period of thirty (30) days after giving
notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such notice, submit his Right Certificate for inspection
by the Company), then the registered holder of any Right Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent.  Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (a) a
Person organized and doing business under the laws of the United States, the State of Georgia or the State of New York (or of any
other state of the United States so long as such corporation is authorized to do business as a banking institution in such state),
in good standing, which is authorized under such laws to exercise stock transfer or corporate trust powers and is subject to supervision
or examination by federal or state authority and which has, along with its Affiliates, at the time of its appointment as Rights
Agent a combined capital and surplus of at least $50,000,000 or (b) an Affiliate of a Person described in clause (a) of
this sentence.  After appointment, the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities
as if it had been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver
and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose.  Not later than the effective date of any such appointment, the Company
shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Stock of the Company
and the Preferred Stock, and give notice to the holders of the Right Certificates by any means reasonably determined by the Company
to inform such holders of such appointment (including without limitation, by including such information in one or more of the Company’s
reports to stockholders or reports or filings with the Securities and Exchange Commission).  Failure to give any notice provided
for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation
or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

 

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Section 22. Issuance of New Right Certificates. 
Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option, issue
new Right Certificates evidencing Rights in such form as may be approved by the Board of Directors to reflect any adjustment or
change in the Exercise Price per share and the number or kind or class of shares of stock or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this Agreement.  In addition, in connection with the
issuance or sale of shares of Common Stock of the Company following the Distribution Date and prior to the redemption or expiration
of the Rights, the Company (a) shall, with respect to shares of Common Stock of the Company so issued or sold pursuant to
the exercise of stock options or under any employee plan or arrangement, or upon the exercise, conversion or exchange of securities
hereafter issued by the Company, and (b) may, in any other case, if deemed necessary or appropriate by the Board of Directors,
issue Right Certificates representing the appropriate number of Rights in connection with such issuance or sale; provided,
however, that (i) no such Right Certificate shall be issued if, and to the extent that, the Company shall be advised
by counsel that such issuance would create a significant risk of material adverse tax consequences to the Company or the Person
to whom such Right Certificate would be issued, and (ii) no such Right Certificate shall be issued if, and to the extent that,
appropriate adjustments shall otherwise have been made in lieu of the issuance thereof.

 

Section 23. Redemption.

 

(a)          The
Board of Directors may, at its option, redeem all but not less than all of the then outstanding Rights at a redemption price of
$0.001 per Right, appropriately adjusted to reflect any stock dividend declared or paid, any subdivision or combination of the
outstanding shares of Common Stock of the Company or any similar event occurring after the date of this Agreement (such redemption
price, as adjusted from time to time, being hereinafter referred to as the “Redemption Price”).  The Rights
may be redeemed at any time prior to the earlier to occur of (i) a Distribution Date, or (ii) the Final Expiration Date.

 

(b)          Immediately
upon the action of the Board of Directors ordering the redemption of the Rights in accordance with this Section 23,
and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter
of the holders of Rights shall be to receive the Redemption Price for each Right so held.  Promptly after the action of the
Board of Directors ordering the redemption of the Rights in accordance with this Section 23, the Company shall give
notice of such redemption to the Rights Agent and the holders of the then outstanding Rights by mailing such notice to the Rights
Agent and to all such holders at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common Stock of the Company.  Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder receives the notice.  The Company promptly
shall mail a notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry
books of the Rights Agent.  Any notice which is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice.  Each such notice of redemption will state the method by which the payment of the Redemption
Price will be made.  Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase for value
any Rights at any time in any manner other than that specifically set forth in this Section 23 or Section 24
hereof or in connection with the purchase of shares of Common Stock of the Company prior to the Distribution Date.

 

(c)          The
Company may, at its option, pay the Redemption Price in cash, shares of Common Stock of the Company (based on the Fair Market Value
of the Common Stock of the Company as of the time of redemption) or any other form of consideration deemed appropriate by the Board
of Directors.

 

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Section 24. Exchange.

 

(a)           (i)          The
Board of Directors may, at its option, at any time on or after the occurrence of a Section 11(a)(ii) Event, exchange
all or part of the then outstanding Rights, whether or not previously exercised (but which exchange shall not include Rights that
have become void pursuant to the provisions of Section 7(e) hereof) for shares of Common Stock of the Company
at an exchange ratio of one share of Common Stock of the Company per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof (such exchange ratio being hereinafter referred to as the
“Section 24(a)(i) Exchange Ratio”).  Notwithstanding the foregoing, the Board of Directors shall
not be empowered to effect such exchange at any time after any Person (other than an Exempt Person), together with all Affiliates
and Associates of such Person, becomes the Beneficial Owner of 50% or more of the Common Stock of the Company.

 

(ii)          Notwithstanding
the foregoing, the Board of Directors may, at its option, at any time on or after the occurrence of a Section 11(a)(ii) Event,
exchange all or part of the then outstanding and exercisable Rights (which shall not include Rights that have become null and void
pursuant to the provisions of Section 7(e) hereof) for shares of Common Stock of the Company at an exchange ratio
specified in the following sentence, as appropriately adjusted to reflect any stock split, stock dividend or similar transaction
occurring after the date of this Agreement.  Subject to the adjustment described in the foregoing sentence, each Right may
be exchanged for that number of shares of Common Stock of the Company obtained by dividing the Spread (as defined in Section 11(a)(iii)
hereof) by the then Fair Market Value of a share of Common Stock of the Company on the earlier of (x) the date on which
any Person becomes an Acquiring Person or (y) the date on which a tender or exchange offer by any Person (other than an Exempt
Person) is first published or sent or given within the meaning of Rule 14d-4(a) of the Exchange Act or any successor
rule, if upon consummation thereof such Person could become an Acquiring Person (such exchange ratio being referred to herein as
the “Section 24(a)(ii) Exchange Ratio”).  Notwithstanding the foregoing, the Board of Directors
shall not be empowered to effect such exchange at any time after any Person (other than an Exempt Person), together with all Affiliates
and Associates of such Person, becomes the Beneficial Owner of 50% or more of the Common Stock of the Company.

 

(b)          Immediately
upon the action of the Board of Directors ordering the exchange of any Rights pursuant to subsection (a) of this Section 24
and without any further action and without any notice, the right to exercise such Rights pursuant to Section 11(a)(ii) hereof
shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of shares of Common Stock
of the Company equal to the number of such Rights held by such holder multiplied by the Section 24(a)(i) Exchange Ratio or
the Section 24(a)(ii) Exchange Ratio, as applicable; provided, however, that the holder of a Right exchanged
pursuant to this Section 24 shall continue to have the right to purchase securities or other property of the Principal
Party following a Section 13 Event that has occurred or may thereafter occur.  The Company shall promptly give notice
of any such exchange in accordance with Section 26 hereof and shall promptly mail a notice of any such exchange to
all of the holders of such Rights at their last addresses as they appear upon the registry books of the Rights Agent; provided,
however, that the failure to give, or any defect in, such notice shall not affect the validity of such exchange.  Any
notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. 
Each such notice of exchange will state the method by which the exchange of the shares of Common Stock of the Company for Rights
will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged.  Any partial exchange
shall be effected pro rata based on the number of Rights (other than Rights which have become null and void pursuant to the provisions
of Section 7(e) hereof) held by each holder of Rights.

 

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(c)          In
any exchange pursuant to this Section 24, the Company, at its option, may substitute Preferred Stock (or Preferred
Stock Equivalent, as such term is defined in Section 11(b) hereof) for Common Stock of the Company exchangeable
for Rights, at the initial rate of one one-thousandth of a share of Preferred Stock (or Preferred Stock Equivalent) for each share
of Common Stock of the Company, as appropriately adjusted to reflect adjustments in the voting rights of the Preferred Stock pursuant
to the terms thereof, so that the fraction of a share of Preferred Stock delivered in lieu of each share of Common Stock of the
Company shall have the same voting rights as one share of Common Stock of the Company.

 

(d)          In
the event that there shall not be sufficient shares of Common Stock of the Company or Preferred Stock (or Preferred Stock Equivalents)
authorized but unissued to permit any exchange of Rights as contemplated in accordance with this Section 24, the Company
shall take all such action as may be necessary to authorize additional shares of Common Stock of the Company or Preferred Stock
(or Preferred Stock Equivalent) for issuance upon exchange of the Rights.

 

(e)          The
Company shall not be required to issue fractions of Common Stock of the Company or to distribute certificates which evidence fractional
shares of Common Stock of the Company.  If the Company elects not to issue such fractional shares of Common Stock of the Company,
the Company shall pay, in lieu of such fractional shares of Common Stock of the Company, to the registered holders of the Right
Certificates with regard to which such fractional shares of Common Stock of the Company would otherwise be issuable, an amount
in cash equal to the same fraction of the Fair Market Value of a whole share of Common Stock of the Company.  For the purposes
of this paragraph (e), the Fair Market Value of a whole share of Common Stock of the Company shall be the closing price of
a share of Common Stock of the Company (as determined pursuant to the second sentence of Section 11(d)(i) hereof)
for the Trading Day immediately prior to the date of exchange pursuant to this Section 24.

 

Section 25. Notice of Certain Events.

 

(a)          In
case the Company shall propose, at any time after the Distribution Date, (i) to pay any dividend payable in stock of any class
to the holders of Preferred Stock or to make any other distribution to the holders of Preferred Stock (other than a regular periodic
cash dividend out of earnings or retained earnings of the Company), or (ii) to offer to the holders of Preferred Stock rights
or warrants to subscribe for or to purchase any additional shares of Preferred Stock or shares of stock of any class or any other
securities, rights or options, or (iii) to effect any reclassification of Preferred Stock (other than a reclassification involving
only the subdivision of outstanding shares of Preferred Stock), or (iv) to effect any consolidation or merger into or with,
or to effect any sale, mortgage or other transfer (or to permit one or more of its Subsidiaries to effect any sale, mortgage or
other transfer), in one transaction or a series of related transactions, of 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to, any other Person (other than a Subsidiary of the Company in one or more transactions
each of which is not prohibited by the proviso at the end of the first sentence of Section 11(n) hereof), or (v) to
effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or pay any dividend on the Common Stock
of the Company payable in Common Stock of the Company or to effect a subdivision, combination or consolidation of the Common Stock
of the Company (by reclassification or otherwise than by payment of dividends in Common Stock of the Company) then in each such
case, the Company shall give to each holder of a Right Certificate and to the Rights Agent, in accordance with Section 26
hereof, a notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, distribution
of rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution,
or winding up is to take place and the date of participation therein by the holders of the shares of Common Stock of the Company
and/or Preferred Stock, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by
clause (i) or (ii) above at least twenty (20) days prior to the record date for determining holders of the shares of
Preferred Stock for purposes of such action, and in the case of any such other action, at least twenty (20) days prior to the date
of the taking of such proposed action or the date of participation therein by the holders of the shares of Common Stock of the
Company and/or Preferred Stock, whichever shall be the earlier; provided, however, no such notice shall be required
pursuant to this Section 25 as a result of any Subsidiary of the Company effecting a consolidation or merger with or
into, or effecting a sale or other transfer of assets or earnings power to, any other Subsidiary of the Company in a manner not
inconsistent with the provisions of this Agreement.

 

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(b)          In
case any Section 11(a)(ii) Event shall occur, then, in any such case, the Company shall as soon as practicable thereafter
give to each registered holder of a Right Certificate and to the Rights Agent, in accordance with Section 26 hereof,
a notice of the occurrence of such event, which shall specify the event and the consequences of the event to holders of Rights
under Section 11(a)(ii) hereof.

 

Section 26. Notices.  Notices
or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or
on the Company shall be sufficiently given or made if sent by first-class mail, postage prepaid, by facsimile transmission or by
nationally-recognized overnight courier addressed (until another address is filed in writing with the Rights Agent) as follows:

 

SED International Holdings, Inc.

3505 Newpoint Place, Suite 450

Lawrenceville, Georgia 30043

Facsimile: (770) 243-1008

Attention:  Chief Executive Officer

 

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

 

Computershare Trust Company, N.A.

250 Royall Street

Canton, Massachusetts 02021

Attention: Client Services

 

Notices or demands authorized by this Agreement
to be given or made by the Company or the Rights Agent to the holder of any Right Certificate (or, prior to the Distribution Date,
to the holder of any certificate representing shares of Common Stock of the Company) shall be sufficiently given or made if sent
by first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of
the Company.

 

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Section 27. Supplements and Amendments. 
Prior to the occurrence of a Section 11(a)(ii) Event, the Company and the Rights Agent shall, if the Board of Directors
so directs, supplement or amend any provision of this Agreement as the Board of Directors may deem necessary or desirable without
the approval of any holders of certificates representing shares of Common Stock of the Company.  From and after the occurrence
of a Section 11(a)(ii) Event, the Company and the Rights Agent shall, if the Board of Directors so directs, supplement
or amend this Agreement without the approval of any holder of Right Certificates in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein which may be defective or inconsistent with any other provisions herein, (iii) to
shorten or lengthen any time period hereunder, or (iv) to change or supplement the provisions hereof in any manner which the
Board of Directors may deem necessary or desirable and which shall not adversely affect the interests of the holders of Right Certificates
(other than an Acquiring Person or any Affiliate or Associate of an Acquiring Person); provided, however, that from
and after the occurrence of a Section 11(a)(ii) Event this Agreement may not be supplemented or amended to lengthen,
pursuant to clause (iii) of this sentence, (A) a time period relating to when the Rights may be redeemed at such time
as the Rights are not then redeemable or (B) any other time period unless such lengthening is for the purpose of protecting,
enhancing or clarifying the rights of, and the benefits to, the holders of Rights (other than an Acquiring Person or any Affiliate
or Associate of an Acquiring Person).  Upon the delivery of such certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment, and any failure of the Rights Agent to so execute such supplement or amendment shall
not affect the validity of the actions taken by the Board of Directors pursuant to this Section 27.  Prior to
the occurrence of a Section 11(a)(ii) Event, the interests of the holders of Rights shall be deemed coincident with the
interests of the holders of Common Stock of the Company.  Notwithstanding any other provision hereof, the Rights Agent’s
consent must be obtained regarding any amendment or supplement pursuant to this Section 27 which alters the Rights
Agent’s rights or duties.

 

Section 28. Successors.  All
the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.

 

Section 29. Determinations and Actions
by the Board of Directors.  The Board of Directors shall have the exclusive power and authority to administer this Agreement
and to exercise all rights and powers specifically granted to the Board of Directors or to the Company, or as may be necessary
or advisable in the administration of this Agreement, including without limitation, the right and power to (i) interpret the
provisions of this Agreement and (ii) make all determinations and computations deemed necessary or advisable for the administration
of this Agreement (including a determination to redeem or not redeem the Rights or to amend the Agreement).  All such actions,
calculations, interpretations and determinations (including, for purposes of clause (y) below, all omissions with respect
to the foregoing) which are done or made by the Board of Directors in good faith shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the Rights and all other parties, and (y) not subject any member of the Board
of Directors to any liability to the holders of the Rights or to any other person.

 

Section 30. Benefits of this Agreement. 
Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the Common Stock of the Company) 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
Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, registered holders of the
Common Stock of the Company).

 

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Section 31. Severability.  If
any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or invalidated; provided, however, that
notwithstanding anything in this Agreement to the contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board of Directors determines in good faith that severing the invalid
language from the Agreement would adversely affect the purpose or effect of the Agreement, the right of redemption set forth in
Section 23 hereof shall be reinstated and shall not expire until the Close of Business on the tenth day following the
date of such determination by the Board of Directors.

 

Section 32. Governing Law. 
This Agreement and the Rights issued hereunder shall be governed by and construed in accordance with the internal laws of Georgia
without regard to the principles of conflicts of laws; provided, however, that all provisions regarding the rights,
obligations, duties and immunities of the Rights Agent shall be governed by and construed in accordance with, the laws of the State
of New York.  The courts of the State of Georgia and of the United States of America located in the State of Georgia (the
“Georgia Courts”) shall have exclusive jurisdiction over any litigation arising out of or relating to this Agreement
and the transactions contemplated hereby, and any Person commencing or otherwise involved in any such litigation shall waive any
objection to the laying of venue of such litigation in the Georgia Courts and shall not plead or claim in any Georgia Court that
such litigation brought therein has been brought in an inconvenient forum.  Notwithstanding the foregoing, the Company and
the Rights Agent may mutually agree to a jurisdiction other than Georgia for any litigation directly between the Company and the
Rights Agent arising out of or relating to this Agreement.

 

Section 33. Counterparts.  This
Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the same instrument. A signature to this Agreement transmitted
electronically shall have the same authority, effect and enforceability as an original signature.

 

Section 34. Descriptive Headings. 
Descriptive headings of the several Sections of this Agreement are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof.

 

Section 35. Force Majeure. 
Notwithstanding anything to the contrary contained herein, neither the Company nor the Rights Agent shall be liable for any delay
or failure in performance resulting directly from any act or event beyond its reasonable control and without the fault or gross
negligence of the delayed or non-performing party that causes a sudden, substantial or widespread disruption in business activities,
including, without limitation, fire, flood, natural disaster or act of God, strike or other industrial disturbance, war (declared
or undeclared), embargo, blockade, legal restriction, riot, insurrection, act of terrorism, disruption in transportation, communications,
electric power or other utilities, or other vital infrastructure or any means of disrupting or damaging internet or other computer
networks or facilities (each, a “Force Majeure Condition”); provided, that such delayed or non-performing
party shall use reasonable commercial efforts to resume performance as soon as practicable.  If any Force Majeure Condition
occurs, the party delayed or unable to perform shall give prompt written notice to the other party, stating the nature of the Force
Majeure Condition and any action being taken to avoid or minimize its effect.

 

[Remainder of page intentionally
left blank]

 

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

 

	 ATTEST:	 	SED INTERNATIONAL HOLDINGS, INC.
	 	 	 
	By:	/s/ Christopher R. Joe  	 	By:	/s/ Robert G. O’Malley
	 	Name: Christopher R. Joe	 	 	Name: Robert G. O’Malley 
	 	 Title: Secretary	 	 	Title:  President
	 	 	 	 	 

 

	ATTEST:	 	COMPUTERSHARE TRUST COMPANY, N.A., 

as Rights Agent
	 	 	 	 	 
	By:	/s/ Michael Lang  	 	By:	/s/ Robert A. Buckley, Jr.
	 	Name:  Michael Lang	 	 	Name:  Robert A. Buckley, Jr.
	 	Title:  Authorized Officer	 	 	Title:   Senior Vice President 

 

    	 

    	 

    

 

Exhibit A

 

ARTICLES OF AMENDMENT

 

TO THE

 

ARTICLES OF INCORPORATION OF

 

SED INTERNATIONAL HOLDINGS, INC.

 

SERIES A JUNIOR PARTICIPATING CUMULATIVE
PREFERRED STOCK

 

SED International Holdings, Inc. (the “Corporation”),
a corporation formed and existing under, and by virtue of, the laws of the State of Georgia, does hereby certify that:

 

FIRST: The name of the Corporation is SED
International Holdings, Inc.

 

SECOND: Under a power contained in Article
II of the Articles of Incorporation of the Corporation (the “Articles”), the Board of Directors of the Corporation
(the “Board”), by duly adopted resolutions, classified and designated 50,000 shares of the authorized but unissued
shares of preferred stock of the Corporation, $1.00 par value per share (the “Preferred Stock”), as shares of
Series A Junior Participating Cumulative Preferred Stock, $1.00 par value per share, with the following preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and
conditions of redemption, which, upon any restatement of the Articles, shall become part of Article II of the Articles, with any
necessary or appropriate renumbering or relettering of the sections or subsections hereof:

 

Section 1. Designation and Amount. 
The shares of such series shall be designated as “Series A Junior Participating Cumulative Preferred Stock” (the “Series
A Preferred Stock”) and the number of shares constituting such series shall be 50,000. Such number of shares may be increased
or decreased by resolution of the Board in accordance with the Articles; provided, that no decrease shall reduce the number
of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved
for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities
issued by the Corporation convertible into Series A Preferred Stock.

 

    	 

    	 

    

 

Section 2. Dividends and Distributions.

 

(A)         (i)          Subject
to the rights of the holders of any shares of any class or series of preferred stock (or any similar stock) ranking prior and superior
to the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference
to the holders of shares of common stock of the Corporation, par value $0.01 per share (“Common Stock”) and
of any other class or series of stock ranking junior to the Series A Preferred Stock, shall be entitled to receive, when,
as and if authorized by the Board and declared by the Corporation out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June, September and December in each year (each such date being referred to
herein as a “Quarterly Dividend Payment Date”), commencing on the first Quarterly Dividend Payment Date after
the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (a) $0.01 or (b) subject to the provisions for adjustment hereinafter set forth, 1,000
times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of
all non-cash dividends or other distributions other than a dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Preferred Stock.  The multiple of cash and non-cash dividends declared on the Common
Stock to which holders of the Series A Preferred Stock are entitled, which shall be 1,000 initially but which shall be adjusted
from time to time as hereinafter provided, is hereinafter referred to as the “Dividend Multiple.”  In the
event the Corporation shall at any time after September 9, 2013 (the “Rights Declaration Date”) (i) declare
or pay any dividend on Common Stock payable in shares of Common Stock, or (ii) effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in each such case the Dividend Multiple thereafter applicable to
the determination of the amount of dividends which holders of shares of Series A Preferred Stock shall be entitled to receive
shall be the Dividend Multiple applicable immediately prior to such event multiplied by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to such event.

 

(ii)         Notwithstanding
anything else contained in this paragraph (A), the Corporation shall, out of funds legally available for that purpose, declare
a dividend or distribution on the Series A Preferred Stock as provided in this paragraph (A) immediately after it declares
a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that,
in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $0.01 per share on the Series A Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.

 

(B)         Dividends
shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment
Date next preceding the date of issue of such shares of Series A Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend
and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date.  Accrued but unpaid dividends shall not bear interest.  Dividends paid on
the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable
on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding.  The Board
may fix in accordance with applicable law a record date for the determination of holders of shares of Series A Preferred Stock
entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than such number
of days prior to the date fixed for the payment thereof as may be allowed by applicable law.

 

    	- 2 -

    	 

    

 

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

 

(A)         Subject
to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof
to 1,000 votes on all matters submitted to a vote of the shareholders of the Corporation.  The number of votes which a holder
of a share of Series A Preferred Stock is entitled to cast, which shall initially be 1,000 but which may be adjusted from
time to time as hereinafter provided, is hereinafter referred to as the “Vote Multiple.”  In the event
the Corporation shall at any time after the Rights Declaration Date (i) declare or pay any dividend on Common Stock payable
in shares of Common Stock, or (ii) effect a subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the Vote Multiple thereafter applicable to the determination of the number of
votes per share to which holders of shares of Series A Preferred Stock shall be entitled shall be the Vote Multiple immediately
prior to such event multiplied by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to
such event.

 

(B)         Except
as otherwise provided in the Articles or by law, the holders of shares of Series A Preferred Stock and the holders of shares
of Common Stock and the holders of shares of any other stock of this Corporation having general voting rights, shall vote together
as one class on all matters submitted to a vote of shareholders of the Corporation.

 

(C)         (i)          Whenever,
at any time or times, dividends payable on any shares of Series A Preferred Stock shall be in arrears in an amount equal to
at least six full quarter dividends (whether or not declared and whether or not consecutive), the holders of record of the outstanding
shares of Series A Preferred Stock shall have the exclusive right, voting separately as a single class, to elect two directors
of the Corporation at a special meeting of shareholders of the Corporation or at the Corporation’s next annual meeting of
shareholders, and at each subsequent annual meeting of shareholders, as provided below.

 

(ii)         Upon
the vesting of such right of the holders of shares of Series A Preferred Stock, the maximum authorized number of members of
the Board shall automatically be increased by two and the two vacancies so created shall be filled by vote of the holders of the
outstanding shares of Series A Preferred Stock as hereinafter set forth.  A special meeting of the shareholders of the
Corporation then entitled to vote shall be called by the Chairman of the Board, Chief Executive Officer or President of the Corporation
or the Secretary of the Corporation, if requested in writing by the holders of record of not less than 5% of the shares of Series A
Preferred Stock then outstanding.  At such special meeting, or, if no such special meeting shall have been called, then at
the next annual meeting of shareholders of the Corporation, the holders of the shares of Series A Preferred Stock shall elect,
voting as above provided, two directors of the Corporation to fill the aforesaid vacancies created by the automatic increase in
the number of members of the Board.  At any and all such meetings for such election, the holders of a majority of the outstanding
shares of Series A Preferred Stock shall be necessary to constitute a quorum for such election, whether present in person
or proxy, and such two directors shall be elected by a plurality of the votes cast by the holders of Series A Preferred Stock. 
Each such additional director shall serve until the next annual meeting of shareholders for the election of directors, or until
his successor shall be elected and shall qualify, or until his right to hold such office terminates pursuant to the provisions
of this Section 3(C).  Any director elected by holders of shares of Series A Preferred Stock pursuant to
this Section 3(C) may be removed at any annual or special meeting, by vote of a majority of the shareholders voting
as a class who elected such director, with or without cause.  In case any vacancy shall occur among the directors elected
by the holders of shares of Series A Preferred Stock pursuant to this Section 3(C), such vacancy may be filled
by the remaining director so elected, or his successor then in office, and the director so elected to fill such vacancy shall serve
until the next meeting of shareholders for the election of directors.

 

    	- 3 -

    	 

    

 

(iii)         
The right of the holders of shares of Series A Preferred Stock, voting separately as a class, to elect two members of the Board
as aforesaid shall continue until, and only until, such time as all arrears in dividends (whether or not declared) on the Series
A Preferred Stock shall have been paid or declared and set apart for payment, at which time such right shall terminate, subject
to revesting in the event of each and every subsequent default of the character above-mentioned.  Upon any termination of
the right of the holders of the Series A Preferred Stock as a class to vote for directors as herein provided, the term of office
of all directors then in office elected by the holders of shares of Series A Preferred Stock pursuant to this Section 3(C)
shall terminate immediately and the number of directors shall be reduced accordingly.  The voting rights granted by this
Section 3(C) shall be in addition to any other voting rights granted to the holders of the Series A Preferred Stock in this
Section 3.

 

(D)         Except
as set forth herein, holders of Series A Preferred Stock shall have no voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action.

 

Section 4.  Certain Restrictions.

 

(A)         Whenever
dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter
and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:

 

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

 

(ii)         declare
or pay dividends on or make any other distributions on any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;

 

    	- 4 -

    	 

    

 

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

 

(iv)        redeem,
purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of any stock ranking
on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except
in accordance with a purchase offer made in writing or by publication (as determined by the Board) to all holders of such shares
upon such terms as the Board, after consideration of the respective annual dividend rates and other relative rights and preferences
of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective
series or classes.

 

(B)         The
Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under subsection (A) of this Section 4, purchase or otherwise
acquire such shares at such time and in such manner.

 

Section 5.  Reacquired Shares. 
Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall become
authorized but unissued shares of preferred stock without designation as to series and may be reissued as part of a new series
of preferred stock to be created by resolution or resolutions of the Board, subject to the conditions and restrictions on issuance
set forth in the Articles or otherwise required by law.

 

Section 6.  Liquidation, Dissolution
or Winding Up.  Upon any liquidation, dissolution or winding up of the Corporation (voluntary or otherwise), no distribution
shall be made (x) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution
or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock
shall have received an amount (the “Series A Liquidation Preference”) equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment, plus an amount equal to the greater of (1) $1,000.00
per share or (2) an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000
times the aggregate amount of all cash or other property to be distributed per share to holders of Common Stock upon such liquidation,
dissolution or winding up of the Corporation, or (y) to the holders of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A
Preferred Stock and all other such parity stock in proportion to the total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up.  In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare or pay any dividend on Common Stock payable in shares of Common Stock, or (ii) effect a
subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case
the aggregate amount per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such
event under clause (x) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to such event.

 

    	- 5 -

    	 

    

 

In the event, however, that there are not
sufficient assets available to permit payment in full of the Series A Liquidation Preference and the liquidation preferences
of all other classes and series of stock of the Corporation, if any, that rank on a parity with the Series A Preferred Stock
in respect thereof, then the assets available for such distribution shall be distributed ratably to the holders of the Series A
Preferred Stock and the holders of such parity shares in proportion to their respective liquidation preferences.

 

Neither the consolidation of nor merging
of the Corporation with or into any other corporation or corporations, nor the sale or other transfer of all or substantially all
of the assets of the Corporation, shall be deemed to be a liquidation, dissolution or winding up of the Corporation within the
meaning of this Section 6.

 

Section 7.  Consolidation,
Merger, etc.  In case the Corporation shall enter into any consolidation, merger, combination or other transaction in
which the outstanding shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed
in an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 1,000 times the aggregate amount
of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share
of Common Stock is changed or exchanged, plus accrued and unpaid dividends, if any, payable with respect to the Series A Preferred
Stock.  In the event the Corporation shall at any time after the Rights Declaration Date (i) declare or pay any dividend
on Common Stock payable in shares of Common Stock, or (ii) effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater
or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect
to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction,
the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately prior to such event.

 

Section 8.  Redemption. 
The shares of Series A Preferred Stock shall not be redeemable; provided, however, that the foregoing shall
not limit the ability of the Corporation to purchase or otherwise deal in such shares to the extent otherwise permitted, by the
Articles or by law.

 

Section 9.  Ranking. Any
class or series of shares of stock of the Corporation shall be deemed to rank: (A) prior to the Series A Preferred Stock, as to
the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, if the holders of such class
or series shall be entitled to the receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up,
as the case may be, in preference or priority to the holders of Series A Preferred Stock; (B) on a parity with the Series A Preferred
Stock, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, whether or
not the dividend rates, dividend payment dates or redemption or liquidation prices per share thereof be different from those of
the Junior Preferred Stock, if the holders of such class or series and the Series A Preferred Stock shall be entitled to the receipt
of dividends and of amounts distributable upon liquidation, dissolution or winding up in proportion to their respective amounts
of accrued and unpaid dividends per share or liquidation preferences, without preference or priority one over the other; or (C)
junior to the Series A Preferred Stock, as to the payment of dividends or as to the distribution of assets upon liquidation, dissolution
or winding up.

 

    	- 6 -

    	 

    

 

Section 10.  Fractional Shares. 
Series A Preferred Stock may be issued in whole shares or in any fraction of a share that is one one-thousandth (1/1,000th)
of a share or any integral multiple of such fraction, which shall entitle the holder, in proportion to such holder’s fractional
shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights
of holders of Series A Preferred Stock.  In lieu of fractional shares, the Corporation may elect to make a cash payment
as provided in the Rights Agreement for fractions of a share other than one one-thousandth (1/1,000th) of a share or any integral
multiple thereof.

 

Section 11.  Amendment. 
At any time any shares of Series A Preferred Stock are outstanding, the Articles and the foregoing Sections 1 through 10,
inclusive, and this Section 11 shall not be amended in any manner, including by merger, consolidation or otherwise,
which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to
affect them adversely without the affirmative vote of the holders of two-thirds or more of the outstanding shares of Series A
Preferred Stock, voting separately as a class.

 

THIRD: This Amendment was duly adopted and
approved by the Board on September 9, 2013.

 

FOURTH: The Series A Preferred Stock has
been classified and designated by the Board under the authority contained in the Articles. This Amendment was duly approved and
adopted by the Board in accordance with the provisions of Section 14-2-602 of the Georgia Business Corporation Code. This
Amendment did not require shareholder action.

 

IN WITNESS WHEREOF, the undersigned
duly authorized officer of the Corporation has executed these Articles of Amendment to the Articles of Incorporation of the Corporation
as of September 9, 2013.

 

 

	 	 	SED INTERNATIONAL HOLDINGS, INC.
	 	 	 
	 	 	By: 	 
	 	 	 	Name: Christopher R. Joe
	 	 	 	Title: Chief Financial Officer

 

    	- 7 -

    	 

    

 

Exhibit B

 

FORM OF RIGHT CERTIFICATE

 

Certificate No. R-            
Rights

 

NOT EXERCISABLE AFTER SEPTEMBER 19, 2016
OR EARLIER IF NOTICE OF REDEMPTION IS GIVEN OR THE RIGHTS ARE TERMINATED IN ACCORDANCE WITH SECTION 7(a) OF THE RIGHTS AGREEMENT
(DEFINED BELOW).  THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF SED INTERNATIONAL HOLDINGS, INC., AT $0.001 PER RIGHT,
ON THE TERMS SET FORTH IN THE TAX BENEFITS PRESERVATION RIGHTS AGREEMENT BETWEEN SED INTERNATIONAL HOLDINGS, INC. AND COMPUTERSHARE
TRUST COMPANY, N.A., A FEDERALLY CHARTERED TRUST COMPANY, AS RIGHTS AGENT, DATED AS OF SEPTEMBER 9, 2013 (THE “RIGHTS
AGREEMENT”).  UNDER CERTAIN CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY
OWNED BY AN ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT)
AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID.

 

Right Certificate

 

SEC INTERNATIONAL HOLDINGS, INC.

 

This certifies that                                 ,
or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Tax Benefits Preservation Rights Agreement dated as of September 9, 2013
(the “Rights Agreement”) between SED International Holdings, Inc., a Georgia corporation (the “Company”),
and Computershare Trust Company, N.A., a federally chartered trust company, as Rights Agent (the “Rights Agent”),
to purchase from the Company at any time after the Distribution Date (as such term is defined in the Rights Agreement) and prior
to the close of business on September 19, 2016 at the office or offices of the Rights Agent designated for such purpose, or its
successors as Rights Agent, one one-thousandth of a fully paid, non-assessable share of the Series A Junior Participating
Cumulative Preferred Stock (the “Preferred Stock”) of the Company, at a purchase price of $6.00 per one one-thousandth
of a share (the “Exercise Price”), upon presentation and surrender of this Right Certificate with the Form of
Election to Purchase and the related Certificate duly executed.  The number of Rights evidenced by this Right Certificate
(and the number of shares which may be purchased upon exercise thereof) set forth above, and the Exercise Price per share set forth
above, are the number and Exercise Price as of                               
, based on the Preferred Stock as constituted at such date.

 

Upon the occurrence of a Section 11(a)(ii) Event
(as such term is defined in the Rights Agreement), if the Rights evidenced by this Right Certificate are beneficially owned by
(i) an Acquiring Person or an Affiliate or Associate of any such Person (as such terms are defined in the Rights Agreement),
(ii) a transferee of any such Acquiring Person or Associate or Affiliate thereof, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a Person who, after such transfer, became an Acquiring Person or an Affiliate
or Associate of an Acquiring Person, such Rights shall become null and void and no holder hereof shall have any right with respect
to such Rights from and after the occurrence of such Section 11(a)(ii) Event.

 

    	 

    	 

    

 

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

 

This Right Certificate is subject to all
of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the
rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of
the Right Certificates, which limitations of rights include the temporary suspension of the exercisability of such Rights under
the specific circumstances set forth in the Rights Agreement.  Copies of the Rights Agreement are on file at the principal
office of the Company and the designated office of the Rights Agent and are also available upon written request to the Company
or the Rights Agent.

 

This Right Certificate, with or without
other Right Certificates, upon surrender at the office or offices of the Rights Agent designated for such purpose, may be exchanged
for another Right Certificate or Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like
aggregate number of shares of Preferred Stock as the Rights evidenced by the Right Certificate or Certificates surrendered shall
have entitled such holder to purchase.  If this Right Certificate shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Right Certificate or Certificates for the number of whole Rights not exercised. 
If this Right Certificate shall be exercised in whole or in part pursuant to Section 11(a)(ii) of the Rights Agreement,
the holder shall be entitled to receive this Right Certificate duly marked to indicate that such exercise has occurred as set forth
in the Rights Agreement.

 

Under certain circumstances, subject to
the provisions of the Rights Agreement, the Board of Directors at its option may cause the Company to exchange all or any part
of the Rights evidenced by this Certificate for shares of the Company’s Common Stock or Preferred Stock at an exchange ratio
(subject to adjustment) specified in the Rights Agreement.

 

Subject to the provisions of the Rights
Agreement, the Rights evidenced by this Certificate may be redeemed by the Board of Directors at its option at a redemption price
of $0.001 per Right (payable in cash, Common Stock or other consideration deemed appropriate by the Board of Directors).

 

The Company is not obligated to issue fractional
shares of stock upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples of
one one-thousandth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts). 
If the Company elects not to issue such fractional shares, in lieu thereof a cash payment will be made, as provided in the Rights
Agreement.

 

No holder of this Right Certificate, as
such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of shares of Preferred Stock, Common
Stock or any other securities of the Company which may at any time be issuable on the exercise hereof, nor shall anything contained
in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a stockholder of
the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders
(except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by this Right Certificate shall have been exercised as provided in the Rights Agreement.

 

    	- 2 -

    	 

    

 

This Right Certificate shall not be valid
or obligatory for any purpose until it shall have been countersigned by an authorized signatory of the Rights Agent.

 

WITNESS the facsimile signature of the proper
officers of the Company as a document under corporate seal.

 

	Attested:	 	SED INTERNATIONAL HOLDINGS, INC.
	 	 	 
	By: 	  	 	By:	      
	 	Name: 	 	 	Name: 
	 	 Title: Secretary	 	 	Title: President

 

	Countersigned:	 	 
	 	 	 
	COMPUTERSHARE TRUST COMPANY, N.A.	 	 
	 	 	 
	By:	                  	 	 
	 	 	 	 
	Name:	 	 	 
	Title:	 	 	 

 

    	- 3 -

    	 

    

 

Form of Reverse
Side of Right Certificate

 

FORM OF ASSIGNMENT

 

(To be executed by the registered holder
if such

holder desires to transfer the Right Certificate.)

 

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

 

	 	Dated:	 	,	 	 	 	 
	 	 	 	 	 
	 	Signature	 	 	 
	 	 	 	 	 
	 	Signature Guaranteed:	 	 	 
	 	 	 	 	 	 	 	 	 

 

CERTIFICATE

 

The undersigned hereby certifies by checking
the appropriate boxes that:

 

(1)          
the Rights evidenced by this Right Certificate     ̈  are    ̈ 
are not being transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such
Person (as such terms are defined in the Rights Agreement); and

 

(2)          
after due inquiry and to the best knowledge of the undersigned, the undersigned   ̈  
did    ̈  did not directly or indirectly acquire the Rights evidenced
by this Right Certificate from any Person who is, was or became an Acquiring Person or an Affiliate or Associate of any such Person.

 

	 	Dated:	 	,	 	 	 	 
	 	 	 	 	 	 	 Signature	 

 

NOTICE

 

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

 

    	 

    	 

    

 

FORM OF ELECTION TO PURCHASE

 

(To be executed if holder desires to

exercise the Right Certificate.)

 

To SED INTERNATIONAL HOLDINGS, INC.:

 

The undersigned hereby irrevocably elects
to exercise  _____  Rights represented by this Right Certificate to purchase the shares of Preferred Stock issuable upon
the exercise of the Rights (or such other securities of the Company or of any other person which may be issuable upon the exercise
of the Rights) and requests that certificates for such shares be issued in the name of:

 

	Please insert social security or other identifying taxpayer number:	 
	 
	 
	 
	 
	(Please print name and address)

 

If such number of Rights shall not be all
the Rights evidenced by this Right Certificate or if the Rights are being exercised pursuant to Section 11(a)(ii) of
the Rights Agreement, a new Right Certificate for the balance of such Rights shall be registered in the name of and delivered to:

 

	Please insert social security or other identifying taxpayer number:	 
	 
	 
	 
	 
	(Please print name and address)

 

	 	Dated:	 	,	 	 	 	 
	 	 	 	 	 	 	Signature	 

 

	Signature Guaranteed:	 	 

 

    	 

    	 

    

 

CERTIFICATE

 

The undersigned hereby certifies by checking
the appropriate boxes that:

 

(1)          
the Rights evidenced by this Right Certificate    ̈   are   ̈ 
are not being exercised by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such
Person (as such terms are defined in the Rights Agreement); and

 

(2)          
after due inquiry and to the best knowledge of the undersigned, the undersigned  ̈     
did   ̈  did not directly or indirectly acquire the Rights evidenced by
this Right Certificate from any Person who is, was or became an Acquiring Person or an Affiliate or Associate of any such Person.

 

	 	Dated:	 	,	 	 	 	 
	 	 	 	 	 	 	Signature	 

 

    	 

    	 

    

 

NOTICE

 

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

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