Document:

Exhibit 4.1

 

AGFEED INDUSTRIES, INC.

 

and

 

BROADRIDGE CORPORATE ISSUER SOLUTIONS,
INC.

 

Rights Agent

 

 

RIGHTS AGREEMENT

 

Dated as of August 10, 2012

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	Page
	 	 	Number
	 	 	 
	Section 1.	Definitions	1
	 	 	 
	Section 2.	Appointment of Rights Agent	5
	 	 	 
	Section 3.	Issue of Right Certificates.	5
	 	 	 
	Section 4.	Form of Right Certificates	7
	 	 	 
	Section 5.	Countersignature and Registration.	7
	 	 	 
	Section 6.	Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.	8
	 	 	 
	Section 7.	Exercise of Rights; Purchase Price; Expiration Date of Rights.	9
	 	 	 
	Section 8.	Cancellation and Destruction of Right Certificates	10
	 	 	 
	Section 9.	Availability of Common Shares	10
	 	 	 
	Section 10.	Common Shares Record Date	10
	 	 	 
	Section 11.	Adjustment of Purchase Price, Number of Shares or Number of Rights	11
	 	 	 
	Section 12.	Certificate of Adjusted Purchase Price or Number of Shares	16
	 	 	 
	Section 13.	Consolidation, Merger or Sale or Transfer of Assets or Earning Power	16
	 	 	 
	Section 14.	Fractional Rights and Fractional Shares.	17
	 	 	 
	Section 15.	Rights of Action	18
	 	 	 
	Section 16.	Agreement of Right Holders	18
	 	 	 
	Section 17.	Right Certificate Holder Not Deemed a Shareholder	19
	 	 	 
	Section 18.	Concerning the Rights Agent	19
	 	 	 
	Section 19.	Merger or Consolidation or Change of Name of Rights Agent.	20
	 	 	 
	Section 20.	Duties of Rights Agent	20
	 	 	 
	Section 21.	Change of Rights Agent	22

 

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	Section 22.	Issuance of New Right Certificates	23
	 	 	 
	Section 23.	Redemption.	23
	 	 	 
	Section 24.	Exchange.	24
	 	 	 
	Section 25.	Notice of Certain Events.	25
	 	 	 
	Section 26.	Notices	25
	 	 	 
	Section 27.	Supplements and Amendments	26
	 	 	 
	Section 28.	Successors	26
	 	 	 
	Section 29.	Determinations and Actions by the Board of Directors	26
	 	 	 
	Section 30.	Benefits of this Agreement	27
	 	 	 
	Section 31.	Severability	27
	 	 	 
	Section 32.	Governing Law	27
	 	 	 
	Section 33.	Counterparts	27
	 	 	 
	Section 34.	Descriptive Headings; Section References	27
	 	 	 
	Section 35.	Force Majeure	27
	 	 	 
	Exhibit A – Form of Right Certificate	 
	 	 
	Exhibit B - Summary of Rights to Purchase Common Shares	 

 

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RIGHTS AGREEMENT

 

RIGHTS AGREEMENT, dated as of August
10, 2012 (the “Agreement”), between AGFEED INDUSTRIES, INC., a Nevada corporation (the “Company”),
and BROADRIDGE CORPORATE ISSUER SOLUTIONS, INC., a Pennsylvania corporation, as rights agent (the “Rights Agent”).

 

WHEREAS, the Board
of Directors of the Company has authorized and declared a dividend of one common share purchase right (a “Right”)
for each Common Share (as hereinafter defined) of the Company outstanding on August 20, 2012 (the “Record Date”),
each Right representing the right to purchase one-quarter of one Common Share, upon the terms and subject to the conditions herein
set forth, and has further authorized and directed the issuance of one Right with respect to each Common Share that shall become
outstanding between the Record Date and the earliest of the Distribution Date, the Redemption Date and the Final Expiration Date
(as such terms are hereinafter defined).

 

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

 

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

 

(a)          “Acquiring
Person” shall mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding, but shall not include the Company, any Subsidiary
of the Company, any employee benefit plan of the Company or any Subsidiary of the Company, any entity holding Common Shares for
or pursuant to the terms of any such plan, or any trustee, administrator or fiduciary of any such plan appointed by the Company;
provided, however, that no Person who Beneficially Owns, as of the time of the public announcement of this Agreement,
15% or more of the Common Shares of the Company then outstanding shall become an Acquiring Person unless such Person shall, after
the time of the public announcement of this Agreement, increase its Beneficial Ownership of the then outstanding Common Shares
(other than as a result of an acquisition of Common Shares by the Company) to an amount equal to or greater than the greater of
(x) 15% or (y) the sum of (i) the lowest Beneficial Ownership of such Person as a percentage of the outstanding Common Shares as
of any date on or after the date of the public announcement of this Agreement plus (ii) 0.001%. Notwithstanding the foregoing,
no Person shall become an “Acquiring Person” as the result of an acquisition of Common Shares by the Company which,
by reducing the number of Common Shares of the Company outstanding, increases the proportionate number of Common Shares of the
Company Beneficially Owned by such Person to 15% or more of the Common Shares of the Company then outstanding; provided,
however, that, if a Person shall become the Beneficial Owner of 15% or more of the Common Shares 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 Common Shares of the Company, then such Person shall be deemed to be an “Acquiring Person.” Notwithstanding
the foregoing, if the Board of Directors of the Company determines in good faith that a Person who would otherwise be an “Acquiring
Person,” as defined pursuant to the foregoing provisions of this Section 1(a), has become such inadvertently, and such Person
divests as promptly as practicable a sufficient number of Common Shares so that such Person would no longer be an “Acquiring
Person,” as defined pursuant to the foregoing provisions of this Section 1(a), then such Person shall not be deemed to be
an “Acquiring Person” for any purposes of this Agreement. Notwithstanding the foregoing, if a bona fide swaps dealer
who would otherwise be an “Acquiring Person” has become so as a result of its actions in the ordinary course of its
business that the Board of Directors of the Company determines, in its sole discretion, were taken without the intent or effect
of evading or assisting any other Person to evade the purposes and intent of this Agreement, or otherwise seeking to control or
influence the management or policies of the Company, then, and unless and until the Board of Directors shall otherwise determine,
such Person shall not be deemed to be an “Acquiring Person” for any purposes of this Agreement.

 

    	 

    	 

    

 

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

 

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

 

(d)          A
Person shall be deemed the “Beneficial Owner” of and shall be deemed to “Beneficially Own”
any securities:

 

(i)          which
such Person or any of such Person’s Affiliates or Associates beneficially owns, directly or indirectly;

 

(ii)         which
such Person or any of such Person’s Affiliates or Associates has (A) the right or the obligation to acquire (whether such
right is exercisable, or such obligation is required to be performed, immediately or only after the passage of time) pursuant to
any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling group members
with respect to a bona fide public offering of securities), or upon the exercise of conversion rights, exchange rights,
rights (other than these Rights), warrants or options, or otherwise; provided, however, 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 or on
behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase
or exchange; or (B) the right to vote pursuant to any agreement, arrangement or understanding; provided, however,
that a Person shall not be deemed the Beneficial Owner of, or to Beneficially Own, any security if the agreement, arrangement or
understanding to vote such security (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 under the Exchange Act (or any comparable or successor report);

 

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(iii)        which
are beneficially owned, directly or indirectly, by any other Person with which such Person or any of such Person’s Affiliates
or Associates has any agreement, arrangement or understanding (other than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering of securities) for the purpose of acquiring, holding, voting
(except to the extent contemplated by the proviso to Section 1(d)(ii)(B)) or disposing of any securities of the Company; or

 

(iv)        which
are beneficially owned, directly or indirectly, by a Counterparty (or any of such Counterparty’s Affiliates or Associates)
under any Derivatives Contract (without regard to any short or similar position under the same or any other Derivatives Contract)
to which such Person or any of such Person’s Affiliates or Associates is a Receiving Party (as such terms are defined in
the immediately following paragraph); provided, however, that the number of Common Shares that a Person is deemed
to Beneficially Own pursuant to this clause (iv) in connection with a particular Derivatives Contract shall not exceed the number
of Notional Common Shares with respect to such Derivatives Contract; provided, further, that the number of securities
beneficially owned by each Counterparty (including its Affiliates and Associates) under a Derivatives Contract shall for purposes
of this clause (iv) be deemed to include all securities that are beneficially owned, directly or indirectly, by any other Counterparty
(or any of such other Counterparty’s Affiliates or Associates) under any Derivatives Contract to which such first Counterparty
(or any of such first Counterparty’s Affiliates or Associates) is a Receiving Party, with this proviso being applied to successive
Counterparties as appropriate.

 

A “Derivatives
Contract” is a contract between two parties (the “Receiving Party” and the “Counterparty”)
that is designed to produce economic benefits and risks to the Receiving Party that correspond substantially to the ownership by
the Receiving Party of a number of Common Shares specified or referenced in such contract (the number corresponding to such economic
benefits and risks, the “Notional Common Shares”), regardless of whether obligations under such contract are
required or permitted to be settled through the delivery of cash, Common Shares or other property, without regard to any short
position under the same or any other Derivative Contract.

 

Notwithstanding
anything in this definition of Beneficial Ownership to the contrary, the phrase “then outstanding,” when used with
reference to a Person’s Beneficial Ownership of securities of the Company, shall mean the number of such securities then
issued and outstanding together with the number of such securities not then actually issued and outstanding which are issuable
by the Company and which such Person would be deemed to Beneficially Own hereunder.

 

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

 

(f)          “Close
of Business” on any given date shall mean 5:00 P.M., Grand Junction, Colorado time, on such date; provided, however,
that, if such date is not a Business Day, it shall mean 5:00 P.M., Grand Junction, Colorado time, on the next succeeding Business
Day.

 

(g)          “Common
Shares” when used with reference to the Company shall mean the shares of common stock, par value $0.001 per share, of
the Company. “Common Shares” when used with reference to any Person other than the Company shall mean the capital stock
(or equity interest) with the greatest voting power of such other Person or, if such other Person is a Subsidiary of another Person,
the Person or Persons that ultimately control such first-mentioned Person.

 

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

 

(i)          “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.

 

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

 

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

 

(l)          “NASDAQ”
shall mean the National Association of Securities Dealers, Inc. Automated Quotation System.

 

(m)          “Person”
shall mean any individual, partnership, firm, corporation, limited liability company, association, trust, unincorporated organization
or other entity, and shall include any successor (by merger or otherwise) of such entity, as well as any group under Rule 13d-5(b)(1)
of the Exchange Act.

 

(n)          “Purchase
Price” shall have the meaning set forth in Section 4.

 

(o)          “Record
Date” shall have the meaning set forth in the recitals of this Agreement.

 

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

 

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

 

(r)          “Right”
shall have the meaning set forth in the recitals of this Agreement.

 

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

 

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(t)          “Shares
Acquisition Date” shall mean the first date of public announcement (which, for purposes of this definition, shall include,
without limitation, a report filed or amended pursuant to Section 13(d) under the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become such.

 

(u)          “Subsidiary”
of any Person shall mean any corporation or other entity of which a majority of the voting power of the voting equity securities
or equity interest is owned, directly or indirectly, by such Person.

 

(v)         “Summary
of Rights” shall have the meaning set forth in Section 3(b).

 

(w)          “Trading
Day” shall have the meaning set forth in Section 11(d).

 

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, upon ten (10) days’ prior written notice to the Rights Agent. The Rights Agent
shall have no duty to supervise, and shall in no event be liable for the acts or omissions of any such co-Rights Agent.

 

Section 3.          Issue
of Right Certificates.

 

(a)          Until
the earlier of (i) the tenth day after the Shares Acquisition Date (or, if the tenth day after the Shares Acquisition Date occurs
before the Record Date, the Close of Business on the Record Date) or (ii) the Close of Business on the tenth Business Day (or such
later date as the Board of Directors of the Company shall determine prior to such time as any Person becomes an Acquiring Person)
after the date that a tender or exchange offer by any Person (the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or any Subsidiary of the Company, any entity holding Common Shares for or pursuant to the terms of any such
plan, or any trustee, administrator or fiduciary of any such plan appointed by the Company) is first published or sent or given
within the meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, if upon consummation thereof,
such Person would become an Acquiring Person (including in either case any such date which is after the date of this Agreement
and prior to the issuance of the Rights; the earlier 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)) by the certificates for Common Shares of the Company
registered in the names of the holders thereof (which certificates shall also be deemed to be Right Certificates) and not by separate
Right Certificates (or, for shares participating in the direct registration system, by notations in the respective book entry accounts
for the Common Stock), and (y) the right to receive Right Certificates will be transferable only in connection with the transfer
of Common Shares of the Company. As soon as practicable after the Distribution Date, the Company will prepare and execute, the
Rights Agent will countersign, and the Company will send or cause to be sent (and the Rights Agent will, if requested, send) by
first-class, insured, postage-prepaid mail, to each record holder of Common Shares 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, a Right Certificate, in substantially
the form of Exhibit A hereto (a “Right Certificate”), evidencing one Right for each Common Share of the Company
so held, subject to adjustment as provided herein. As of the Distribution Date, the Rights will be evidenced solely by such Right
Certificates.

 

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(b)          On
the Record Date, or as soon as practicable thereafter, the Company will make available a Summary of Rights to Purchase Common Shares,
in substantially the form of Exhibit B hereto (the “Summary of Rights”), to any holder of Rights who may so
request from time to time prior to the earlier of the Final Expiration Date or the Redemption Date. With respect to certificates
for Common Shares of the Company outstanding as of the Record Date, until the Distribution Date, the Rights will be evidenced by
such certificates for the Common Shares of the Company (or, in the case of shares reflected on the direct registration system,
the notations in the book entry account) and the registered holders of Common Sharers of the Company shall also be the registered
holders of the associated Rights. Until the Distribution Date (or the earlier of the Redemption Date or the Final Expiration Date),
the surrender for transfer of any certificate for Common Shares of the Company outstanding on the Record Date, with or without
a copy of the Summary of Rights attached thereto, shall also constitute the transfer of the Rights associated with the Common Shares
of the Company represented thereby.

 

(c)          Certificates
for Common Shares of the Company that become outstanding (including, without limitation, reacquired Common Shares referred to in
the last sentence of this Section 3(c)) after the Record Date but prior to the earliest of the Distribution Date, the Redemption
Date or the Final Expiration Date shall have impressed on, printed on, written on or otherwise affixed to them the following legend:

 

This certificate also evidences
and entitles the holder hereof to certain rights as set forth in the Rights Agreement between AgFeed Industries, Inc. and Broadridge
Corporate Issuer Solutions, Inc., dated as of August 10, 2012, as it may be amended from time to time (the “Agreement”),
the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal executive offices
of AgFeed Industries, Inc. Under certain circumstances, as set forth in the Agreement, such Rights (as defined in the Agreement)
will be evidenced by separate certificates and will no longer be evidenced by this certificate. AgFeed Industries, Inc. will mail
to the holder of this certificate a copy of the Agreement without charge after receipt of a written request therefor. As set forth
in the Agreement, Rights Beneficially Owned by any Person (as defined in the Agreement) who becomes an Acquiring Person (as defined
in the Agreement) become null and void.

 

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With respect to such certificates
containing the foregoing legend, until the Distribution Date, the Rights associated with the Common Shares of the Company represented
by such certificates shall be evidenced by such certificates alone, and the surrender for transfer of any such certificate shall
also constitute the transfer of the Rights associated with the Common Shares of the Company represented thereby. Similarly, during
such time periods, transfers of shares participating in the direct registration system shall also be deemed to be transfers of
the associated Rights. In the case of any shares participating in the direct registration system, the Company shall cause the transfer
agent for the Common Shares of the Company to include on each direct registration account statement with respect thereto issued
prior to the earliest of the Distribution Date, the Redemption Date or the Final Expiration Date a notation to the effect that
references to Common Shares of the Company also includes the associated Rights. To the extent that Common Shares of the
Company are not represented by certificates, references in this Agreement to certificates shall be deemed to refer to the notations
in the book entry accounts reflecting ownership of such shares. In the event that the Company purchases or acquires any Common
Shares of the Company after the Record Date but prior to the Distribution Date, any Rights associated with such Common Shares of
the Company shall be deemed cancelled and retired so that the Company shall not be entitled to exercise any Rights associated with
the Common Shares of the Company which are no longer outstanding. Notwithstanding this Section 3(c), the omission of a legend shall
not affect the enforceability of any part of this Rights Agreement or the rights of any holder of the Rights.

 

Section 4.          Form
of Right Certificates. The Right Certificates (and the forms of election to purchase Common Shares and of assignment to be
printed on the reverse thereof) shall be substantially the same as Exhibit A 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 or with any applicable rule or regulation
made pursuant thereto or with any applicable rule or regulation of any stock exchange or the Financial Industry Regulatory Authority,
or to conform to usage. Subject to the provisions of Section 22, the Right Certificates shall entitle the holders thereof to purchase
such number of Common Shares as shall be set forth therein at the price per Common Share set forth therein (the “Purchase
Price”), but the number of such Common Shares and the Purchase Price shall be subject to adjustment as provided herein.

 

Section 5.          Countersignature
and Registration.

 

(a)          The
Right Certificates shall be executed on behalf of the Company by its Chairman of the Board, its Chief Executive Officer, its President,
any of its Vice Presidents, its Treasurer or an Assistant Treasurer, either manually or by facsimile signature, and shall be attested
by the Secretary or an Assistant Secretary of the Company, either manually or by facsimile signature. The Right Certificates shall
be countersigned, either manually or by facsimile signature, by the Rights Agent and shall not be valid for any purpose unless
countersigned. 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 the Rights Agent and issued and delivered by the Company with the same force and effect as though the individual
who signed such Right Certificates had not ceased to be such officer of the Company; and any Right Certificate may be signed on
behalf of the Company by any individual 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 Agreement any such individual was
not such an officer.

 

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(b)          Following
the Distribution Date, the Rights Agent will keep or cause to be kept, at its principal office, 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 14, at any time after the Close of Business on the Distribution Date, and at or prior to the Close
of Business on the earlier of the Redemption Date or the Final Expiration Date, any Right Certificate or Right Certificates (other
than Right Certificates representing Rights that have become void pursuant to Section 11(a)(ii) or that have been exchanged pursuant
to Section 24) may be transferred, split up, combined or exchanged for another Right Certificate or Right Certificates entitling
the registered holder to purchase a like number of Common Shares as the Right Certificate or Right Certificates surrendered then
entitled such holder to purchase. Any registered holder desiring to transfer, split up, combine or exchange any Right Certificate
or Right Certificates shall make such request in writing delivered to the Rights Agent, and shall surrender the Right Certificate
or Right Certificates to be transferred, split up, combined or exchanged at the principal office of the Rights Agent. Thereupon
the Rights Agent shall countersign and deliver to the Person entitled thereto a Right Certificate or Right Certificates, as the
case may be, as so requested. The Company may require payment of a sum sufficient to cover any tax or charge that may be imposed
in connection with any transfer, split up, combination or exchange of Right Certificates.

 

(b)          Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory to each of them of the loss, theft, destruction
or mutilation of a Right Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory
to each of them, and, at the Company’s request, 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 make and deliver a new Right Certificate of like tenor to the Rights Agent for delivery to the registered holder in lieu of
the Right Certificate so lost, stolen, destroyed or mutilated.

 

(c)          Notwithstanding
any other provisions hereof, the Company and the Rights Agent may amend this Rights Agreement to provide for uncertificated Rights
in addition to or in place of Rights evidenced by Rights Certificates.

 

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

 

(a)          Each
Right shall be exercisable to purchase one-quarter of one Common Share, subject to further adjustment as provided herein. 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 on
the reverse side thereof duly executed, to the Rights Agent at the principal office of the Rights Agent, together with payment
of the Purchase Price for each one Common Share as to which the Rights are exercised, at or prior to the earliest of (i) the Close
of Business on August 10, 2022 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed
as provided in Section 23 (the “Redemption Date”), or (iii) the time at which such Rights are exchanged as provided
in Section 24; provided, however, that if the number of Rights exercised would entitle the holder thereof
to receive any fraction of a Common Share greater than one-quarter of a Common Share, then the holder thereof shall not be entitled
to exercise such Rights unless such holder concurrently purchases from the Company (and in such event the Company shall sell to
such holder), at a price in proportion to the Purchase Price, an additional fraction of a Common Share which, when added to the
number of Common Shares to be received upon such exercise, will equal an integral number of Common Shares.

 

(b)          The
Purchase Price for each full Common Share purchasable pursuant to the exercise of a Right shall initially be $5.00 (equivalent
to $1.25 for each one-quarter of one Common Share), and shall be subject to adjustment from time to time as provided in Section
11 or 13, and shall be payable in lawful money of the United States of America in accordance with Section 7(c).

 

(c)          Upon
receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase duly executed, accompanied
by payment of the Purchase Price for the shares to be purchased and an amount equal to any applicable transfer tax required to
be paid by the holder of such Right Certificate in accordance with Section 9 by cash or by certified check, cashier’s check
or money order payable to the order of the Company, the Rights Agent shall thereupon promptly (i) requisition from any transfer
agent of the Common Shares certificates for the number of Common Shares to be purchased and the Company hereby irrevocably authorizes
any such transfer agent to comply with all such requests; (ii) when appropriate, requisition from the Company the amount of cash
to be paid in lieu of issuance of fractional Common Shares in accordance with Section 14; (iii) after receipt of such certificates,
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; and (iv) when appropriate, after receipt, deliver such cash to or upon the order
of the registered holder of such Right Certificate.

 

(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 to the registered holder of
such Right Certificate or to such holder’s duly authorized assigns, subject to the provisions of Section 14.

 

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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 to any of its agents, be delivered to the Rights Agent for cancellation
or in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled 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 cancelled Right Certificates
to the Company, or shall, at the written request of the Company, destroy such cancelled Right Certificates, and, in such case,
shall deliver a certificate of destruction thereof to the Company.

 

Section 9.          Availability
of Common Shares. The Company covenants and agrees that it will cause to be reserved and kept available out of its authorized
and unissued Common Shares or any Common Shares held in its treasury the number of Common Shares that will be sufficient to permit
the exercise in full of all outstanding Rights in accordance with Section 7. The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all Common Shares delivered upon exercise of Rights shall, at the time of delivery
of the certificates for such Common Shares (subject to payment of the Purchase Price), be duly and validly authorized and issued
and fully paid and nonassessable shares.

 

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 Common Shares 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
to a Person other than, or the issuance or delivery of certificates or depositary receipts for the Common Shares in a name other
than that of, the registered holder of the Right Certificate evidencing Rights surrendered for exercise or to issue or to deliver
any certificates or depositary receipts for Common Shares upon the exercise of any Rights until any 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 reasonable satisfaction that no such tax is due.

 

Section 10.         Common
Shares Record Date. Each Person in whose name any certificate for Common Shares is issued upon the exercise of Rights shall
for all purposes be deemed to have become the holder of record of the Common Shares 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 Purchase
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 Common Shares transfer books of the Company are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall be dated, the next succeeding Business Day on which the Common Shares
transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a holder of Common 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.

 

    	10

    	 

    

 

Section 11.         Adjustment
of Purchase Price, Number of Shares or Number of Rights. The Purchase Price, the number of Common 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 Common Shares payable in
Common Shares, (B) subdivide the outstanding Common Shares, (C) combine the outstanding Common Shares into a smaller number of
Common Shares or (D) issue any shares of its capital stock in a reclassification of the Common Shares (including any such reclassification
in connection with a share exchange, consolidation or merger in which the Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a), the Purchase Price in effect at the time of the record date for such dividend
or of the effective date of such subdivision, combination or reclassification, and the number and kind of shares of capital stock
issuable on such date, shall be proportionately adjusted so that the holder of any Right exercised after such time shall be entitled
to receive the aggregate number and kind of shares of capital stock which, if such Right had been exercised immediately prior to
such date and at a time when the Common Shares 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 or reclassification; provided,
however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par
value of the shares of capital stock of the Company issuable upon exercise of one Right.

 

(ii)         Subject
to Section 24, in the event any Person becomes an Acquiring Person, each holder of a Right shall thereafter have a right to receive,
upon exercise thereof at a price equal to four times the then current Purchase Price per full Common Share multiplied by the number
of Common Shares for which a Right is then exercisable, in accordance with the terms of this Agreement, such number of Common Shares
of the Company as shall equal the result obtained by (A) multiplying four times the then current Purchase Price per full Common
Share by the number of Common Shares for which a Right is then exercisable and dividing that product by (B) 50% of the then current
per share market price of the Common Shares of the Company (determined pursuant to Section 11(d)) on the date of the occurrence
of such event. In the event that any Person shall become an Acquiring Person and the Rights shall then be outstanding, the Company
shall not take any action which would eliminate or diminish the benefits intended to be afforded by the Rights.

 

    	11

    	 

    

 

From and after
the occurrence of such event, any Rights that are or were acquired or Beneficially Owned by any Acquiring Person (or any Associate
or Affiliate of such Acquiring Person) shall be null and void without any further action, and any holder of such Rights shall thereafter
have no right to exercise such Rights under any provision of this Agreement or otherwise. Neither the Company nor the Rights Agent
shall have 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 its Affiliates, Associates or transferees hereunder. No Right Certificate shall be issued
pursuant to Section 3 that represents Rights Beneficially Owned by an Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof; no Right Certificate shall be issued at any time upon the transfer of
any Rights to an Acquiring Person whose Rights would be void pursuant to the preceding sentence or any Associate or Affiliate thereof
or to any nominee of such Acquiring Person, Associate or Affiliate or with respect to any Common Shares otherwise deemed to be
Beneficially Owned by any of the foregoing; and any Right Certificate delivered to the Rights Agent for transfer to an Acquiring
Person or other Person whose Rights would be void pursuant to the preceding sentence shall be cancelled.

 

(iii)        In
the event that there shall not be sufficient Common Shares issued but not outstanding or authorized but unissued to permit the
exercise in full of the Rights in accordance with subparagraph (ii) above, the Company shall take all such action as may be necessary
to authorize additional Common Shares for issuance upon exercise of the Rights. In the event the Company shall, after good faith
effort, be unable to take all such action as may be necessary to authorize such additional Common Shares, the Company shall substitute,
for each Common Share that would otherwise be issuable upon exercise of a Right, other equity securities of the Company (including,
without limitation, shares, or units of shares, of preferred stock, if any, which the Board of Directors of the Company has deemed
to have the same value as Common Shares (such other equity securities, hereinafter referred to as “common stock equivalents”)).

 

(b)          In
case the Company shall fix a record date for the issuance of rights, options or warrants to all holders of Common Shares entitling
them (for a period expiring within 45 calendar days after such record date) to subscribe for or purchase Common Shares or securities
convertible into Common Shares at a price per Common Share (or having a conversion price per share, if a security convertible into
Common Shares less than the then current per share market price of the Common Shares (as defined in Section 11(d)) on such record
date, the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which shall be the number of Common Shares outstanding on
such record date plus the number of Common Shares which the aggregate offering price of the total number of Common Shares so to
be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such
current market price and the denominator of which shall be the number of Common Shares outstanding on such record date plus the
number of additional Common Shares 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 one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise
of one Right. Any such determination shall be described in a statement filed with the Rights Agent and shall be binding on the
Rights Agent and holders of the Rights. 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 as determined in good faith by the Board of Directors of
the Company, whose determination shall be described in a statement filed with the Rights Agent and shall be binding on the Rights
Agent and holders of the Rights. Common Shares owned by or held for the account of the Company or any Subsidiary of the Company
shall not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such
a record date is fixed; and, in the event that such rights, options or warrants are not so issued, the Purchase Price shall be
adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.

 

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(c)          In
case the Company shall fix a record date for the making of a distribution to all holders of the Common Shares (including any such
distribution made in connection with a share exchange, consolidation or merger in which the Company is the continuing or surviving
corporation) of evidences of indebtedness or assets (other than a regular quarterly cash dividend or a dividend payable in Common
Shares) or subscription rights or warrants (excluding those referred to in Section 11(b)), the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction,
the numerator of which shall be the then-current per share market price of the Common Shares on such record date, less the fair
market value (as determined in good faith by the Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent and holders of the Rights) of the portion of the
assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants applicable to one Common Share
and the denominator of which shall be such then-current per share market price of the Common Shares on such record date; provided,
however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par
value of the shares of capital stock of the Company to be issued upon exercise of one 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 Purchase Price shall again be
adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.

 

(d)          For
the purpose of any computation hereunder, the “current per share market price” of the Common Shares on any date shall
be deemed to be the average of the daily closing prices per Common Share for the 30 consecutive Trading Days immediately prior
to such date; provided, however, that, in the event that the current per share market price of the Common Shares
is determined during a period following the announcement by the issuer of the Common Shares of (A) a dividend or distribution on
such Common Shares payable in shares of such Common Shares or Securities convertible into such Common Shares, or (B) any subdivision,
combination or reclassification of Common Shares and prior to the expiration of 30 Trading Days after the ex-dividend date for
such dividend or distribution, or the record date for such subdivision, combination or reclassification, then, and in each such
case, the current per share market price shall be appropriately adjusted to reflect the current market price per Common Share.
The closing price for each day shall be the last sale price, regular way, reported at or prior to 4:00 P.M. Eastern time or, in
case no such sale takes place on such day, the average of the bid and asked prices, regular way, reported as of 4:00 P.M. Eastern
time, in either case, as reported in the principal consolidated transaction reporting system with respect to securities listed
on the principal national securities exchange on which the Common Shares are listed or admitted to trading or, if the Common Shares
are not listed or admitted to trading on any national securities exchange, the last quoted price reported at or prior to 4:00 P.M.
Eastern time or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported
as of 4:00 P.M. Eastern time by NASDAQ or such other system then in use, or, if on any such date the Common Shares are not quoted
by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a
market in the Common Shares selected by the Board of Directors of the Company. If on any such date no such market maker is making
a market in the Rights, the current per share market price of the Common Shares on such date as determined in good faith by the
Board of Directors of the Company shall be used, provided, however, that if at the time of such determination there
is an Acquiring Person, the current per share market price of the Common Shares on such date shall be determined by a nationally
recognized investment banking firm selected by the Board of Directors of the Company, 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 the Common Shares are listed or admitted
to trading is open for the transaction of business, or, if the Common Shares are not listed or admitted to trading on any national
securities exchange, a Business Day.

 

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

 

(f)          If,
as a result of an adjustment made pursuant to Section 11(a), the holder of any Right thereafter exercised shall become entitled
to receive any shares of capital stock of the Company other than Common Shares, 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 Common Shares contained in Section 11(a) through (c), inclusive, and the provisions of Sections
7, 9, 10 and 13 with respect to the Common Shares 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 Purchase Price hereunder shall evidence the right
to purchase, at the adjusted Purchase Price, the number of Common Shares purchasable from time to time hereunder upon exercise
of the Rights, all subject to further adjustment as provided herein.

 

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(h)          Unless
the Company shall have exercised its election as provided in Section 11(i), upon each adjustment of the Purchase Price as a result
of the calculations made in Sections 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 Purchase Price, that number of Common Shares (calculated to the nearest
one-millionth of a Common Share) obtained by (A) multiplying (x) the number of Common Shares covered by a Right immediately prior
to this adjustment by (y) the Purchase Price in effect immediately prior to such adjustment of the Purchase Price and (B) dividing
the product so obtained by the Purchase Price in effect immediately after such adjustment of the Purchase Price.

 

(i)          The
Company may elect, on or after the date of any adjustment of the Purchase Price, to adjust the number of Rights in substitution
for any adjustment in the number of Common Shares purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of Common Shares 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 ten-thousandth) obtained by dividing the Purchase Price in effect immediately prior
to adjustment of the Purchase Price by the Purchase Price in effect immediately after adjustment of the Purchase 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 Purchase Price
is adjusted or any day thereafter, but, if the Right Certificates have been issued, shall be at least 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, 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 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 Purchase Price or in the number of Common Shares issuable upon the exercise of the Rights, the
Right Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of Common Shares
which were expressed in the initial Right Certificates issued hereunder.

 

(k)          Before
taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the Common Shares
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 Common Shares at such adjusted Purchase
Price.

 

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(l)          In
any case in which this Section 11 shall require that an adjustment in the Purchase 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 of the Common Shares and other capital stock or securities of the Company, if any, issuable upon
such exercise over and above the Common Shares and other capital stock or securities of the Company, if any, issuable upon such
exercise on the basis of the Purchase 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.

 

(m)          Anything
in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price,
in addition to those adjustments expressly required by this Section 11, as and to the extent that it, in its sole discretion, shall
determine to be advisable in order that any consolidation or subdivision of the Common Shares, issuance wholly for cash of any
Common Shares at less than the current market price, issuance wholly for cash of Common Shares or securities which by their terms
are convertible into or exchangeable for Common Shares, dividends on Common Shares payable in Common Shares or issuance of rights,
options or warrants referred to in Section 11(b), hereafter made by the Company to holders of the Common Shares shall not be taxable
to such shareholders.

 

Section 12.         Certificate
of Adjusted Purchase Price or Number of Shares. Whenever an adjustment is made as provided in Sections 11 or 13, the Company
shall promptly (a) prepare a certificate setting forth such adjustment or describing such event and a brief statement of the facts
accounting for such adjustment or describing such event, (b) file with the Rights Agent and with each transfer agent for the Common
Shares a copy of such certificate and (c) if such adjustment occurs at any time after the Distribution Date, mail a brief summary
thereof to each holder of a Right Certificate in accordance with Section 25.

 

Section 13.         Consolidation,
Merger or Sale or Transfer of Assets or Earning Power. In the event, directly or indirectly, at any time after a Person has
become an Acquiring Person, (a) the Company shall effect a share exchange, consolidate with, or merge with and into, any other
Person, (b) any Person shall effect a share exchange, consolidate with the Company, or merge with and into the Company and the
Company shall be the continuing or surviving corporation of such share exchange, consolidation or merger and, in connection with
such share exchange, consolidation or merger, all or part of the Common Shares of the Company shall be changed into or exchanged
for stock or other securities of any other Person (or the Company) or cash or any other property, or (c) the Company shall sell
or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more 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 other than the Company or one or more of its wholly-owned Subsidiaries, then, and in each such case, proper
provision shall be made so that (i) each holder of a Right (except as otherwise provided herein) shall thereafter have the right
to receive, upon the exercise thereof at a price equal to four times the then current Purchase Price per full Common Share multiplied
by the number of Common Shares for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu
of Common Shares, such number of Common Shares of such other Person (including the Company as successor thereto or as the surviving
corporation) as shall equal the result obtained by (A) multiplying four times the then current Purchase Price per full Common
Share by the number of Common Shares for which a Right is then exercisable and dividing that product by (B) 50% of the then current
per share market price of the Common Shares of such other Person (determined pursuant to Section 11(d)) on the date of consummation
of such share exchange, consolidation, merger, sale or transfer; (ii) the issuer of such Common Shares shall thereafter be liable
for, and shall assume, by virtue of such share exchange, consolidation, merger, sale 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 issuer;
and (iv) such issuer shall take such steps (including, but not limited to, the reservation of a sufficient number of its Common
Shares in accordance with Section 9) 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 the Common Shares of the Company thereafter deliverable
upon the exercise of the Rights. The Company shall not consummate any such share exchange, consolidation, merger, sale or transfer
unless, prior thereto, the Company and such issuer shall have executed and delivered to the Rights Agent a supplemental agreement
so providing. The Company shall not enter into any transaction of the kind referred to in this Section 13 if at the time of such
transaction there are any rights, warrants, instruments or securities outstanding or any agreements or arrangements which, as
a result of the consummation of such transaction, would eliminate or substantially diminish the benefits intended to be afforded
by the Rights. The provisions of this Section 13 shall similarly apply to successive mergers, share exchanges, or consolidations
or sales or other transfers.

 

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Section 14.         Fractional
Rights and Fractional Shares.

 

(a)          The
Company shall not be required to issue fractions of Rights or to distribute Right Certificates which evidence fractional Rights.
In lieu of such fractional Rights, there shall be paid 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 current market value of
a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price of
the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable.
The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national securities exchange on which the Rights are listed
or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by NASDAQ
or such other system then in use or, if on any such date the Rights are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no such market maker is making a market in the Rights, the fair value of the Rights
on such date as determined in good faith by the Board of Directors of the Company shall be used.

 

    	17

    	 

    

 

(b)          The
Company shall not be required to issue fractions of Common Shares upon exercise of the Rights or to distribute certificates which
evidence fractional Common Shares. In lieu of fractional Common Shares, equal to one-quarter of a Common Share or less, the Company
shall 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 current market value of one Common Share. Any exercise of Rights that would entitle the
holder thereof to receive any fraction of a Common Share greater than one-quarter of a Common Share shall be governed by Section
7(a). For the purposes of this Section 14(b), the current market value of a Common Share shall be the closing price of a Common
Share (as determined pursuant to the second sentence of Section 11(d)(i)) for the Trading Day immediately prior to the date of
such exercise.

 

(c)          The
holder of a Right, by the acceptance of the Right, expressly waives such holder’s right to receive any fractional Rights
or any fractional shares upon exercise of a Right (except as provided above).

 

Section 15.         Rights
of Action. All rights of action in respect of this Agreement, excepting the rights of action given to the Rights Agent under
Section 18, are vested in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the
registered holders of the Common Shares); and any registered holder of any Right Certificate (or, prior to the Distribution Date,
of the Common Shares), 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 Shares), may, in such holder’s own behalf and for such 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, such
holder’s right to exercise the Rights 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 will be entitled to specific
performance of the obligations under, and injunctive relief against actual or threatened violations of the obligations of any Person
subject to, this Agreement.

 

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, the Rights will be transferable only in connection with the transfer of the Common Shares;

 

(b)          after
the Distribution Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent, duly endorsed or accompanied by a proper instrument of transfer, as determined by the
Rights Agent; and

 

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

 

Section 17.         Right
Certificate Holder Not Deemed a Shareholder. 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 Common Shares 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 shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give
or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as
provided in Section 25), 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.

 

Section 18.         Concerning
the Rights Agent. The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder,
as mutually agreed in writing by the Rights Agent, and, from time to time, on demand of the Rights Agent, its reasonable expenses
and counsel fees and other disbursements incurred in the administration and execution of this 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 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 in the premises.

 

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 for the Common Shares or for other securities
of the Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, oral or written
direction, consent, certificate, instruction, statement, or other paper or document or oral instruction believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged, by the proper Person or Persons, or otherwise upon the
advice of counsel as set forth in Section 20. The Rights Agent’s aggregate liability during any
term of this Agreement with respect to, arising from, or arising in connection with this Agreement, or from all services provided
or omitted to be provided under this Agreement, whether in contract, or in tort, or otherwise, other than liabilities attributable
to the Rights Agent’s gross negligence willful misconduct or bad faith, is limited to, and shall not exceed, the amounts
paid or payable hereunder by the Company to Rights Agent as fees and charges, but not including reimbursable expenses.

 

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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 effect a share exchange,
be consolidated, or any Person resulting from any merger, share exchange, or consolidation to which the Rights Agent or any successor
Rights Agent shall be a party, or any Person succeeding to the stock transfer or corporate trust powers 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 document or any further act on the part of any of the parties hereto; provided that such Person would be eligible
for appointment as a successor Rights Agent under the provisions of Section 21. 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 Rights Agent 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.

 

Section 20.         Duties
of Rights Agent. The Rights Agent undertakes the duties and obligations 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 (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
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 be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate
signed by any one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Treasurer,
any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company and delivered to the Rights Agent; and 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.

 

    	20

    	 

    

 

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

 

(d)          The
Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this 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 11(a)(ii)) or any adjustment in the terms of the Rights (including the manner, method
or amount thereof) provided for in Section 3, 11, 13, 23 or 24, or the ascertaining of the existence of facts that would require
any such change or adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after receipt of a
certificate pursuant to Section 12 describing such change or adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any Common Shares to be issued pursuant to this Agreement
or any Right Certificate or as to whether any Common Shares will, when issued, be validly authorized and issued, fully paid and
nonassessable.

 

(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 from
any one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer or any Assistant Treasurer of the Company, and to apply to such officers for advice or instructions in
connection with its duties, and it shall not be liable for any action taken or suffered by it in good faith in accordance with
instructions of any such officer or for any delay in acting while waiting for those instructions.

 

(h)          The
Rights Agent and any shareholder, 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 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 Person.

 

    	21

    	 

    

 

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

 

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 30 days’ notice in writing mailed to the Company and, in the event that the Rights Agent or one of its Affiliates is
not also the transfer agent for the Company, to each transfer agent of the Common Shares by registered or certified mail. In the
event the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent will be
deemed to have resigned automatically and be discharged from its duties under this Agreement as of 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) upon 30 days’ notice in writing, mailed to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent of the Common Shares by registered or certified mail, and, if such removal occurs
after the Distribution Date, to the holders of the Right Certificates by first-class mail. 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 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
(which holder shall, with such notice, submit such holder’s 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, but not the current Rights Agent, whether appointed by the Company or by such a court, shall be either
(a) a Person organized and doing business under the laws of the United States or of the states of New York or Nevada (or of any
other state of the United States so long as such Person is authorized to do business as a banking institution in such state), in
good standing, which is authorized under such laws to exercise corporate trust or stock transfer powers and is subject to supervision
or examination by federal or state authority and which has at the time of its appointment as Rights Agent a combined capital and
surplus of at least $50 million or (b) an Affiliate or direct or indirect wholly-owned Subsidiary of such Person or its wholly-owning
parent. 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 Shares, and, if such appointment
occurs after the Distribution Date, mail a notice thereof in writing to the registered holders of the Right Certificates. Failure
to give any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

 

    	22

    	 

    

 

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 of
the Company to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares or other securities
or property purchasable under the Right Certificates made in accordance with the provisions of this Agreement.

 

Section 23.         Redemption.

 

(a)          The
Board of Directors of the Company may, at its option, at any time prior to such time as any Person becomes an Acquiring Person,
redeem all but not less than all the then outstanding Rights at a redemption price of $.001 per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price being hereinafter
referred to as the “Redemption Price”). The redemption of the Rights by the Board of Directors of the Company
may be made effective at such time, on such basis and with such conditions as the Board of Directors of the Company, in its sole
discretion, may establish.

 

(b)          Immediately
upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to Section 23(a), and without
any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price. The Company shall promptly give public notice of any such redemption;
provided, however, that the failure to give, or any defect in, any such notice shall not affect the validity of such
redemption. Within 10 days after such action of the Board of Directors of the Company ordering the redemption of the Rights, the
Company shall mail a notice of redemption to all the holders of the then outstanding Rights 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 Shares. 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 in Section 24, and other than in connection with the purchase of Common
Shares prior to the Distribution Date.

 

    	23

    	 

    

 

Section 24.         Exchange.

 

(a)          The
Board of Directors of the Company may, at its option, at any time after any Person becomes an Acquiring Person, exchange all or
part of the then outstanding and exercisable Rights (which shall not include Rights that have become void pursuant to the provisions
of Section 11(a)(ii)) for Common Shares of the Company at an exchange ratio of one Common Share per Right, appropriately adjusted
to reflect any adjustment in the number of Rights pursuant to Section 11(i) (such exchange ratio being hereinafter referred to
as the “Exchange Ratio”). Notwithstanding the foregoing, the Board of Directors of the Company shall not be
empowered to effect such exchange at any time after any Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any such Subsidiary, any entity holding Common Shares for or pursuant to the terms of any such plan,
or any trustee, administrator or fiduciary of any such plan appointed by the Company), together with all Affiliates and Associates
of such Person, becomes the Beneficial Owner of 50% or more of the Common Shares of the Company then outstanding.

 

(b)          Immediately
upon the action of the Board of Directors of the Company ordering the exchange of any Rights pursuant to Section 24(a) and without
any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a
holder of such Rights shall be to receive that number of Common Shares of the Company equal to the number of such Rights held by
such holder multiplied by the Exchange Ratio. The Company shall promptly give public notice of any such exchange; provided,
however, that the failure to give, or any defect in, such notice shall not affect the validity of such exchange. The 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 exchange will state the method by which the exchange of the Common Shares
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
void pursuant to the provisions of Section 11(a)(ii)) held by each holder of Rights.

 

(c)          In
the event that there shall not be sufficient Common Shares of the Company issued but not outstanding or 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 Common Shares of the Company for issuance upon exchange of the Rights. In the event the
Company shall, after good faith effort, be unable to take all such action as may be necessary to authorize such additional Common
Shares of the Company, the Company shall substitute, for each Common Share that would otherwise be issuable upon exchange of a
Right, common stock equivalents (as such term is defined in Section 11(a)(iii)) for some or all of the Common Shares exchangeable
for Rights.

 

(d)          The
Company shall not be required to issue fractions of Common Shares of the Company or to distribute certificates which evidence fractional
Common Shares of the Company. In lieu of such fractional Common Shares of the Company, the Company shall pay to the registered
holders of the Right Certificates with regard to which such fractional Common Shares of the Company would otherwise be issuable
an amount in cash equal to the same fraction of the current market value of a whole Common Share. For the purposes of this Section
24(d), the current market value of a whole Common Share shall be the closing price of a Common Share (as determined pursuant to
the second sentence of Section 11(d)(i)) for the Trading Day immediately prior to the date of exchange pursuant to this Section
24.

 

    	24

    	 

    

 

Section 25.         Notice
of Certain Events.

 

(a)          In
case the Company shall, at any time after the Distribution Date, propose (i) to pay any dividend payable in stock of any class
to the holders of the Common Shares or to make any other distribution to the holders of the Common Shares (other than a regular
quarterly cash dividend), (ii) to offer to the holders of the Common Shares rights or warrants to subscribe for or to purchase
any additional Common Shares or shares of stock of any class or any other securities, rights or options, (iii) to effect any reclassification
of the Common Shares (other than a reclassification involving only the subdivision of outstanding Common Shares), (iv) to effect
any share exchange, consolidation or merger into or with, or to effect any sale or other transfer (or to permit one or more of
its Subsidiaries to effect any sale or other transfer), in one or more transactions, of 50% or more of the assets or earning power
of the Company and its Subsidiaries (taken as a whole) to, any other Person, or (v) to effect the liquidation, dissolution or winding
up of the Company, then, in each such case, the Company shall give to each holder of a Right Certificate, in accordance with Section
26, a notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, or distribution
of rights or warrants, or the date on which such reclassification, share exchange, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation therein by the holders of the Common Shares, 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 10
days prior to the record date for determining holders of the Common Shares for purposes of such action, and, in the case of any
such other action, at least 10 days prior to the date of the taking of such proposed action or the date of participation therein
by the holders of the Common Shares, whichever shall be the earlier.

 

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

 

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 overnight delivery service or first-class mail, postage prepaid,
addressed (until another address is filed in writing with the Rights Agent) as follows:

 

AgFeed Industries, Inc.

744 Horizon Court, Suite 350

Grand Junction, Colorado 81506

Attention: Secretary

 

    	25

    	 

    

 

Subject to the provisions
of Section 21, 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 overnight delivery service or first-class
mail, postage prepaid, addressed (until another address is filed in writing with the Company) as follows:

 

Broadridge Corporate Issuer Solutions,
Inc.

1717 Arch Street, Suite 1300

Philadelphia, PA 19103

Attn:
Reorganization Department

 

With a copy
to:

 

Broadridge Financial Solutions,
Inc.

2 Journal Square Plaza

Jersey City, NJ 07306

Attn:
General Counsel

 

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 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.

 

Section 27.         Supplements
and Amendments. The Company may from time to time supplement or amend this Agreement without the approval of any holders of
Right Certificates in order to cure any ambiguity, to correct or supplement any provision contained herein which may be defective
or inconsistent with any other provisions herein, or to make any other provisions with respect to the Rights which the Company
may deem necessary or desirable, any such supplement or amendment to be evidenced by a writing signed by the Company and the Rights
Agent, if acceptable to Rights Agent; provided, however, that, from and after such time as any Person becomes an
Acquiring Person, this Agreement shall not be amended in any manner which would adversely affect the interests of the holders of
Rights.

 

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. For all purposes of this Agreement, any calculation of the number of Common Shares of
the Company outstanding at any particular time, including for purposes of determining the particular percentage of such outstanding
Common Shares of which any Person is the Beneficial Owner, shall be made in accordance with the last sentence of Rule 13d-3(d)(1)(i)
of the General Rules and Regulations under the Exchange Act. The Board of Directors of the Company 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 deemed necessary or advisable
for the administration of this Agreement (including, without limitation, a determination to redeem or not redeem the Rights or
to amend the Agreement and any determination as to whether actions or any Person shall be such as to cause such Person to beneficially
own shares held by another Person). All such actions, calculations, interpretations and determinations (including, for purposes
of clause (A) below, all omissions with respect to the foregoing) which are done or made by the Board of Directors of the Company
in good faith, shall (A) be final, conclusive and binding on the Company, the Rights Agent, the holders of the Rights and all other
parties, and (B) not subject the Board of Directors of the Company to any liability to the holders of the Rights or to any other
Person.

 

    	26

    	 

    

 

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 Shares 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, the
Common Shares of the Company).

 

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.

 

Section 32.         Governing
Law. This Agreement and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the
State of Nevada and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to
contracts to be made and performed entirely within such State.

 

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; Section References. 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. All references in this Agreement
to Sections mean the Section of this Agreement.

 

Section 35.         Force
Majeure. Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable for any delays or
failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, terrorist
acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunctions of computer facilities, or loss of data due
to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war or civil unrest.

 

    	27

    	 

    

 

Section 36.         Consequential
Damages

 

Neither party to this Agreement shall be liable for any consequential, indirect, special or incidental damages under
any provision of this Agreement or for any consequential, indirect, penal, special or incidental damages arising out of any act
or failure to act hereunder even if that party has been advised of or has foreseen the possibility of such damages.

 

Section 37.         Confidentiality

 

The
Rights Agent and the Company agree that all books, records, information and data pertaining to the business of the other
party which are received pursuant to the negotiation or the carrying out of this Agreement, including the fees for services, shall
remain confidential and shall not be voluntarily disclosed to any other person (except the party’s attorneys and advisors),
except with the written approval of the other party or as may be required by law.

 

    	28

    	 

    

 

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

  

	Attest:	AGFEED INDUSTRIES, INC.

 

	By:	/s/ Clayton T. Marshall	 	By:	/s/ K. Ivan F. Gothner
	 	Clayton T. Marshall	 	 	K. Ivan F. Gothner
	 	Chief Financial Officer	 	 	Chairman and Chief Executive Officer

 

	Attest:	BROADRIDGE CORPORATE ISSUER SOLUTIONS, INC.

 

	By:	/s/ Gordon Stevenson	 	By:	/s/ James O’Kegan
	 	Name: Gordon Stevenson	 	 	Name: James O’Kegan
	 	Title: Senior Director	 	 	Title: Vice President

 

    	29

    	 

    

 

Exhibit A 

 

[Form of Right Certificate]

 

	Certificate No. R-	___ Rights

 

NOT EXERCISABLE AFTER AUGUST 10, 2022 OR
EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.001 PER RIGHT AND TO EXCHANGE ON THE TERMS
SET FORTH IN THE AGREEMENT.

 

Right Certificate

 

AGFEED INDUSTRIES, 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 Agreement, dated as of August 10, 2012 (the “Agreement”),
between AgFeed Industries, Inc., a Nevada corporation (the “Company”), and Broadridge Corporate Issuer Solutions,
Inc. (the “Rights Agent”), to purchase from the Company at any time after the Distribution Date (as such term
is defined in the Agreement) and prior to 5:00 P.M., Grand Junction, Colorado time, on August 10, 2022 at the principal office
of the Rights Agent, or at the office of its successor as Rights Agent, one-quarter of one fully paid non-assessable (except as
otherwise provided by any corporation law applicable to the Company) share of common stock, par value $0.001 per share (the “Common
Shares”), of the Company, at a purchase price of $5.00 per full Common Share (the “Purchase Price”)
(equivalent to $1.25 for each one-quarter of a Common Share), upon presentation and surrender of this Right Certificate with the
Form of Election to Purchase duly executed. The number of Rights evidenced by this Right Certificate (and the number of Common
Shares which may be purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number and
Purchase Price as of August 10, 2012, based on the Common Shares as constituted at such date. As provided in the Agreement, the
Purchase Price and the number of Common Shares 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 Agreement, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which 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. Copies of the Agreement are on file at the principal executive offices of the Company and the offices of the Rights
Agent.

 

This Right Certificate,
with or without other Right Certificates, upon surrender at the principal office of the Rights Agent, may be exchanged for another
Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate
number of Common Shares as the Rights evidenced by the Right Certificate or Right 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 Right Certificates for the number of whole Rights not exercised.

 

    	A-1

    	 

    

 

Subject to the provisions
of the Agreement, the Rights evidenced by this Right Certificate (i) may be redeemed by the Company at a redemption price of $.001
per Right or (ii) may be exchanged in whole or in part for Common Shares.

 

No fractional Common
Shares will be issued upon the exercise of any Right or Rights evidenced hereby, but, in lieu thereof, a cash payment will be made,
as provided in the Agreement. No Rights may be exercised that would entitle the holder to any fraction of a Common Share greater
than one-quarter of a Common Share unless concurrently therewith such holder purchases an additional fraction of a Common Share
which, when added to the number of Common Shares to be received upon such exercise, equals an integral number of Common Shares,
as provided in the Rights Agreement.

 

No holder of this Right
Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Common Shares or of any
other securities of the Company which may at any time be issuable on the exercise hereof, nor shall anything contained in the Agreement
or herein be construed to confer upon the holder hereof, as such, any of the rights of a shareholder of the Company or any right
to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in
the 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 Agreement.

 

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

 

WITNESS the facsimile
signature of the proper officers of the Company. Dated as of ____________, 20__.

 

	ATTEST:	 	 	AGFEED INDUSTRIES, INC.	 
	 	 	 	 	 
	 	 	 	 	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 

 

	Countersigned:	 
	 	 
	[_____________________________]	 

 

	By	 	 
	 	Name:	 
	 	Title:	 

 

    	A-2

    	 

    

 

[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:

 

Signatures must be guaranteed by a member
or participant in the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature Program or the
Stock Exchange Medallion Program.

 

The undersigned hereby
certifies that the Rights evidenced by this Right Certificate are not Beneficially Owned by an Acquiring Person or an Affiliate
or Associate thereof (as defined in the Agreement).

 

 

	 	Signature	 

 

    	A-3

    	 

    

 

[Form of Reverse Side of Right Certificate
– continued]

 

FORM OF ELECTION TO PURCHASE

 

(To be executed if holder desires to exercise

Rights represented by the Right Certificate.)

 

To: AGFEED INDUSTRIES, INC.

 

The undersigned hereby
irrevocably elects to exercise __________ Rights represented by this Right Certificate to purchase the Common Shares issuable upon
the exercise of such Rights and requests that certificates for such Common Shares be issued in the name of:

 

Please insert social security

or other identifying number

 

	(Please print name and address)
	 

 

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

 

Please insert social security

or other identifying number

 

	(Please print name and address)
	 

 

	Dated:	 	 

 

 

	 	Signature	 

 

Signature Guaranteed:

 

Signatures must be guaranteed
by a member or participant in the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature
Program or the Stock Exchange Medallion Program.

 

    	A-4

    	 

    

 

The undersigned hereby
certifies that the Rights evidenced by this Right Certificate are not Beneficially Owned by an Acquiring Person or an Affiliate
or Associate thereof (as defined in the Agreement).

 

 

	 	Signature	 

 

NOTICE

 

 The signature in the Form of Assignment
or Form of Election to Purchase, as the case may be, must conform to the name as written upon the face of this Right Certificate
in every particular, without alteration or enlargement or any change whatsoever.

 

In the event the certification
set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, the Company
and the Rights Agent will deem the Beneficial Owner of the Rights evidenced by this Right Certificate to be an Acquiring Person
or an Affiliate or Associate thereof (as defined in the Agreement) and such Assignment or Election to Purchase will not be honored.

 

    	A-5

    	 

    

 

Exhibit B

 

AGFEED INDUSTRIES, INC.

 

SUMMARY OF RIGHTS TO PURCHASE

COMMON SHARES

 

Effective August 10,
2012, the Board of Directors of our Company, AgFeed Industries, Inc., a Nevada corporation, declared a dividend of one common share
purchase right (a “Right”) for each outstanding share of common stock, par value $0.001 per share (the “Common
Shares”). The dividend is payable on August 20, 2012 to the shareholders of record on August 20, 2012.

 

Our Board has adopted
this Rights Agreement to protect shareholders from coercive or otherwise unfair takeover tactics. In general terms, it works by
imposing a significant penalty upon any person or group which acquires 15% or more of our outstanding common stock without the
approval of our Board. The Rights Agreement should not interfere with any merger or other business combination approved by our
Board.

 

For those interested
in the specific terms of the Rights Agreement as made between our Company and Broadridge Corporate Issuer Solutions, Inc., as the
Rights Agent, on August 10, 2012, we provide the following summary description. Please note, however, that this description is
only a summary, and is not complete, and should be read together with the entire Rights Agreement, which has been filed with the
Securities and Exchange Commission as an exhibit to a Registration Statement on Form 8-A dated August 10, 2012. A copy of the agreement
is available free of charge from our Company.

 

The Rights. Our Board authorized
the issuance of a Right with respect to each outstanding share of common stock on August 20, 2012. The Rights will initially trade
with, and will be inseparable from, the common stock. The Rights are evidenced only by certificates that represent shares of common
stock. New Rights will accompany any new shares of common stock we issue after August 20, 2012 until the Distribution Date described
below.

 

Exercise Price. Each Right will
allow its holder to purchase from our Company one-quarter of one Common Share for $5.00 per full Common Share (equivalent to $1.25
for each one-quarter of a Common Share), once the Rights become exercisable. Prior to exercise, the Right does not give its holder
any dividend, voting, or liquidation rights.

 

Exercisability. The Rights will
not be exercisable until the earlier of (1) 10 days after the public announcement that a person or group has become an “Acquiring
Person” by obtaining beneficial ownership of 15% or more of our outstanding common stock or (2) 10 business days (or such
later date as the Board shall determine) following the commencement of a tender offer or exchange offer that would result in a
person or group becoming an “Acquiring Person.”

 

    	B-1

    	 

    

 

Certain synthetic interests
in securities created by derivative positions — whether or not such interests are considered to be ownership of the underlying
common stock or are reportable for purposes of Regulation 13D of the Securities Exchange Act — are treated as beneficial
ownership of the number of shares of the company’s common stock equivalent to the economic exposure created by the derivative
position, to the extent actual shares of the company’s common stock are directly or indirectly held by counterparties to
the derivatives contracts. Swaps dealers unassociated with any control intent or intent to evade the purposes of the Rights Plan
are excepted from such imputed beneficial ownership.

 

We refer to the date
when the Rights become exercisable as the “Distribution Date.” Until that date, the common stock certificates will
also evidence the Rights, and any transfer of shares of common stock will constitute a transfer of Rights. After that date, the
Rights will separate from the common stock and be evidenced by book entry credits or by Rights certificates that we will mail to
all eligible holders of common stock. Any Rights held by an Acquiring Person are void and may not be exercised.

 

Consequences of a Person or Group Becoming
an Acquiring Person.

 

		·	Flip In. If a person or group becomes an Acquiring Person, all holders of Rights except
the Acquiring Person may, for $5.00, purchase shares of our common stock with a market value of $10.00, based on the market price
of the common stock prior to such acquisition.

 

		·	Flip Over. If our Company is later acquired in a merger or similar transaction after the
Rights Distribution Date, all holders of Rights except the Acquiring Person may, for $5.00, purchase shares of the Acquiring Person
with a market value of $10.00 based on the market price of the Acquiring Person’s stock, prior to such merger.

 

Notional Shares. Shares held by
Affiliates and Associates of an Acquiring Person, and Notional Shares held by counterparties to a Derivatives Contract with an
Acquiring Person, will be deemed to be beneficially owned by the Acquiring Person.

 

Expiration. The Rights will expire
on August 10, 2022, subject to extension or earlier expiration of the Rights as provided under the Rights Agreement.

 

Redemption. Our Board may redeem
the Rights for $.001 per Right at any time before any person or group becomes an Acquiring Person. If our Board redeems any Rights,
it must redeem all of the Rights. Once the Rights are redeemed, the only right of the holders of Rights will be to receive the
redemption price of $.001 per Right. The redemption price will be adjusted if we have a stock split or stock dividends of our common
stock.

 

Exchange. After a person or group
becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of our outstanding common stock, our Board may extinguish
the Rights by exchanging one share of common stock or an equivalent security for each Right, other than Rights held by the Acquiring
Person.

 

Anti-Dilution Provisions. Our Board
may adjust the purchase price of the Common Shares, the number of Common Shares issuable and the number of outstanding Rights to
prevent dilution that may occur from a stock dividend, a stock split or a reclassification of the Common Shares. No adjustments
to the Exercise Price of less than 1% will be made.

 

    	B-2

    	 

    

 

Amendments. The terms of the Rights
Agreement may be amended by our Board without the consent of the holders of the Rights. After a person or group becomes an Acquiring
Person, our Board may not amend the agreement in a way that adversely affects holders of the Rights.

 

    	B-3AMENDMENT TO SECURED PROMISSORY NOTE
AGREEMENT

 

This Amendment to Promissory Note Agreement
(the “Amendment”), is effective as of August 7, 2012 (the “Effective Date”), and is entered
by and between T3 Motion, Inc., a Delaware corporation (“Company”), and JMJ Financial (hereinafter referred
to as the “Holder”).

 

Recitals

 

WHEREAS, Company and the Holder are parties
to that certain Secured Promissory Note Agreement dated July 10, 2012, as amended July 30, 2012 and August 3, 2012 (the “Note”);
and

 

WHEREAS, the parties now wish to amend the
Note as set forth in further detail below.

 

Agreement

 

NOW, THEREFORE, in consideration of the
foregoing and the mutual covenants and premises contained in this Amendment, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

		1.	The maturity date of the Note is hereby extended from August 7, 2012, to August 10, 2012.

 

		2.	Except as provided herein, all other provisions of the Note shall remain in full force and effect until expiration or termination
as set forth therein.

 

This Amendment may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which shall together constitute one and the same agreement. Delivery of an
executed counterpart of the signature page to this Amendment by facsimile or by email of a scanned copy will be effective as delivery
of an original executed counterpart of this Amendment.

 

IN WITNESS WHEREOF, the parties have caused
this Amendment to be executed as of the Effective Date.

  

	
        T3 Motion, Inc. 

         

         

        By:/s/ Domonic Carney                  

        Name:Domonic Carney

        Title:  Chief Financial Officer 

         
	
        JMJ Financial

         

         

        By:/s/ Justin Keener                  

        Name: JMJ Financial

        Title:   Its Principal

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