Document:

Exhibit 10.1

 

[Certain
identified information has been excluded from this Exhibit because it is both (i) not material and (ii) would be competitively
harmful if publicly disclosed.]

 

Amended
and Restated

Master
Distribution Agreement

 

between

 

Creative
Realities, Inc. 

 

and

 

InReality,
LLC 

 

dated
as of: September 1, 2020

 

     

    	 

    

 

Amended
and Restated

Master
Distribution Agreement

 

This
Amended and Restated Master Distribution Agreement (“Agreement”),
dated as of September 1, 2020, is entered into by and between Creative Realities, Inc., a Minnesota corporation (“Master
Distributor”), and InReality, LLC, a Wisconsin limited liability company (“Seller”, and together
with Master Distributor, the “Parties”, and each, a “Party”).

 

RECITALS

 

A. Master
Distributor and Seller previously entered into that certain Master Distribution Agreement dated June 19, 2020 (the “Prior
Agreement”), and the Parties desire to amend and restate the Prior Agreement in its entirety.

 

B. Seller
is in the business of developing and licensing and hosting software-as-a-service platforms, including the Platform (as defined
below), that interface with digital temperature and other hardware solutions.

 

C. Master
Distributor desires to sell subscriptions to the Platform to distributors, resellers, and end users, subject to the terms and
conditions of this Agreement; and

 

D. Seller
wishes to grant Master Distributor the right to sublicense subscriptions to the Platform under the terms and conditions of this
Agreement.

 

AGREEMENT

 

NOW,
THEREFORE, in consideration of the mutual covenants, terms, and conditions set out herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

ARTICLE
I

DEFINITIONS

 

Capitalized
terms have the meanings set out in this Section, or in the Section in which they first appear in this Agreement.

 

“Action”
means any claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation,
citation, summons, subpoena, or investigation of any nature, civil, criminal, administrative, regulatory, or other, whether at
law, in equity, or otherwise.

 

“Affiliate”
of a Person means any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by,
or is under common Control with, this Person.

 

“Agreement”
means this Amended and Restated Master Distribution Agreement (including all of its schedules, exhibits, and attachments), as
the same may be amended from time to time.

 

    1

    	 

    

 

“Business
Day” means any day except Saturday, Sunday, or any day other than Saturday, Sunday, or a federal holiday.

 

“Claim”
means any Action made or brought against a Person entitled to indemnification under Article X.

 

“Confidential
Information” has the meaning set out in Article VIII. 

 

“Control”
(and with correlative meanings, the terms “Controlled by” and “under common Control with”) means, regarding
any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies
of another Person, whether through the ownership of voting securities, by contract, or otherwise.

 

“CRI-Sourced
Reseller” means any Reseller to whom Master Distributor or a Distributor sublicenses Platform Subscriptions.

 

“Customer”
means a customer that is (a) a CRI Sourced Reseller or Distributor, whether or not located in the Territory, who sublicenses Platform
for further sublicense to End Users located in the Territory or (b) an End User in the Territory.

 

“Defective”
means not conforming to the warranties in Section 5.01(a).

 

“Defective
Goods” means Goods that are Defective.

 

“Disclosing
Party” has the meaning set out in Section 8.01. 

 

“Dispute”
has the meaning set out in Section 13.13.

 

“Dispute
Notice” has the meaning set out in Section 13.13.

 

“Distributor”
has the meaning set out in Section 2.01 and is limited to referencing the following organizations:

 

		●	[***]

  

From
time to time, Master Distributor and Seller shall mutually agree in writing to add additional Distributors for inclusion into
the definition of “Distributor”.

 

“Effective
Date” means the date first set out in the Preamble to this Agreement.

 

“End
User” means the end user that (a) has acquired a Hardware Solution from Master Distributor or another third-party for
(i) its own and its Affiliates’ use and not for resale, remarketing, or distribution or (ii) incorporation into its own
services or operations and (b) is an individual or entity, other than any Governmental Authority, located in the Territory.

 

    2

    	 

    

 

“Force
Majeure Event” has the meaning set out in Section 13.16.

 

“Goods”
means Seller’s Thermal Mirror hardware solution.

 

“Governmental
Authority” means any federal, state, local, or foreign government or political subdivision thereof, or any agency or
instrumentality of the government or political subdivision, or any self-regulated organization or other non-governmental regulatory
authority, or quasi-governmental authority (to the extent that the rules, regulations, or orders of this organization or authority
have the force of Law), or any arbitrator, court, or tribunal of competent jurisdiction.

 

“Governmental
Order” means any order, writ, judgment, injunction, decree, stipulation, award, or determination entered by or with
any Governmental Authority, including, without limitation, with respect to COVID-19 or any other epidemic or pandemic illness.

 

“Hardware
Solutions” means the hardware solutions listed on Addendum A, as may be amended from time to time by mutual agreement
of the Parties.

 

“Initial
Term” has the meaning set out in Section 7.01.

 

“Intellectual
Property Rights” means all industrial and other intellectual property rights comprising or relating to: (a) Patents;
(b) Trademarks; (c) internet domain names, whether or not Trademarks, registered by any authorized private registrar or Governmental
Authority, web addresses, web pages, website, and URLs; (d) works of authorship, expressions, designs, and design registrations,
whether or not copyrightable, including copyrights and copyrightable works, software, and firmware, application programming interfaces,
architecture, files, records, schematics, data, data files, and databases and other specifications and documentation; (e) Trade
Secrets; (f) semiconductor chips, mask works and the like; and (g) all industrial and other intellectual property rights, and
all rights, interests, and protections that are associated with, equivalent or similar to, or required for the exercise of, any
of the foregoing, however arising, in each case whether registered or unregistered and including all registrations and applications
for, and renewals or extensions of, these rights or forms of protection under the Laws of any jurisdiction throughout in any part
of the world.

 

“Law”
means any statute, law, ordinance, regulation, rule, code, constitution, treaty, common law, Governmental Order, or other requirement
or rule of law of any Governmental Authority.

 

“Losses”
has the meaning set out in Section 10.01.

 

“Manufacturer”
has the meaning set out in Section 5.03.

 

“Master
Distributor Contract” means any material contract or agreement to which Master Distributor is a party or to which any
of its material assets are bound.

 

“Master
Distributor Indemnitees” has the meaning set out in Section 10.01.

 

    3

    	 

    

 

“Master
Distributor’s Trademarks” means all Trademarks owned by or licensed to Seller and set out in Schedule 4.

 

“Notice”
has the meaning set out in Section 13.04.

 

“Notify”
means to give Notice.

 

“Patents”
means all patents (including all reissues, divisionals, provisionals, continuations, and continuations-in-part, re-examinations,
renewals, substitutions, and extensions thereof), patent applications, and other patent rights and any other Governmental Authority-issued
indicia of invention ownership (including inventor’s certificates, petty patents, and patent utility models).

 

“Person”
means any individual, partnership, corporation, trust, limited liability entity, unincorporated organization, association, Governmental
Authority, or any other entity.

 

“Personnel”
means agents, employees, or subcontractors engaged or appointed by Seller or Master Distributor, as applicable.

 

“Platform”
means the Seller’s Safe Space software-as-a-service (SaaS) platform and related services including any documentation; modified
versions of the Platform; enhancements; derivations; upgrades; data tables; software code; any application program interface (“API”),
device driver interface, or any other interface and future versions of the Platform.

 

“Platform
Subscriptions” means any of the named levels of subscription to the Platform set forth on Schedule 1.

 

“Receiving
Party” has the meaning set out in Section 8.01.

 

“Renewal
Term” has the meaning set out in Section 7.02.

 

“Representatives”
means a Party’s Affiliates, employees, officers, directors, partners, shareholders, agents, attorneys, third-party advisors,
successors, and permitted assigns.

 

“Reseller”
has the meaning set out in Section 2.03.

 

“Seller
Contract” means any material contract or agreement to which Seller is a party or to which any of its material assets
are bound.

 

“Seller’s
Intellectual Property Rights” means all Intellectual Property Rights owned by or licensed to Seller.

 

“Seller’s
Trademarks” means all Trademarks owned by or licensed to Seller and set out in Schedule 4.

 

“Subscription
Level” means one of the named levels of Platform Subscription set forth on Schedule 1.

 

    4

    	 

    

 

“Term”
has the meaning set out in Section 10.02.

 

“Territory”
means the United States of America, including its territories, possessions, and military bases, and Canada.

 

“Trademarks”
means all rights in and to U.S. and foreign trademarks, service marks, trade dress, trade names, brand names, logos, trade dress,
corporate names, and domain names and other similar designations of source, sponsorship, association or origin, together with
the goodwill symbolized by any of the foregoing, in each case whether registered or unregistered and including all registrations
and applications for, and renewals or extensions of, these rights and all similar or equivalent rights, or forms of protection
in any part of the world.

 

“Trade
Secrets” means all inventions, discoveries, trade secrets, business, and technical information and know-how, databases,
data collections, patent disclosures, and other confidential and proprietary information and all rights therein.

 

“Warranty
Period” has the meaning set forth in Section 5.01.

 

ARTICLE
II

MASTER
DISTRIBUTOR RIGHTS

 

Section
2.01 Appointment. Subject to the terms and conditions of this Agreement, Seller grants Master Distributor a non-exclusive,
nontransferable, irrevocable appointment to market, resell and distribute the Platform Subscriptions to Customers and Distributors
of Platform Subscriptions in the Territory during the Term and in accordance with the terms and conditions of this Agreement,
provided that such Customer and Distributor appointments shall be by written agreements containing terms and conditions at least
as restrictive as this Agreement. Nothing contained herein shall restrict Master Distributor from having the right to obtain or
retain the rights to resell any other goods or software as-a-service subscriptions, including goods or software as-a-service subscriptions
that may compete with the Platform or the Goods. Seller shall not acquire, import and/or distribute temperature sensing devices
used for human screening applications for use in the Territory. In addition, Seller will not, during the Term of this Agreement,
pursue and establish direct sublicensing relationship with the Distributors with whom Master Distributor has a Master Distributor
Contract in the Territory. Master Distributor shall not (i) translate, reverse-engineer, decompile or disassemble the Platform
or let any third party do any of the foregoing; (ii) attempt to derive the source code of any software provided to Master Distributor
in object code, or create derivative works of any software, or let any third party do any of the foregoing; (iii) alter or remove
any of Seller’s or its licensor’s copyright or other proprietary rights notices or legends appearing on or in the
Platform; or (iv) use the Platform or any component thereof for any purpose other than as specified in this Agreement.

 

Section
2.02 Distributors, Resellers, and Referrals. Master Distributor may appoint Distributors, and establish reseller
and referral programs as it determines appropriate in its sole and absolute discretion for the effective sublicense of the Platform
Subscriptions under this Agreement. Master Distributor shall bear all costs related to any reseller or referral programs.

 

    5

    	 

    

 

Section
2.03 Distribution by Seller in Territory. Nothing contained herein shall limit Seller’s ability to sublicense Platform
Subscriptions to any reseller of Hardware Solutions and/or Platform Subscriptions within the Territory (each, a “Reseller”)
in accordance with the terms and conditions of this Agreement; provided, however, that Seller may only sell Platform
Subscriptions to a Reseller at prices equal to or greater than the prices set forth on Schedule 2 Distribution Pricing Column,
except in the case that Seller sublicenses more than 200 Platform Subscriptions to a single Reseller in any single transaction;
and (b) no Distributor may be deemed a Reseller.

 

Section
2.04 EULA. Neither Master Distributor nor Customer shall offer an end user a license for the Platform except under the terms
and conditions of an End User License Agreement (“EULA”) approved by Seller as of the time of such offer. The
rights and obligations of Seller to the End User and the End User to Seller shall be governed exclusively by the terms of the
EULA. Master Distributor and Customer shall not have authority to execute any proposed EULA on Seller’s behalf. Master Distributor
and Customer shall not add to, delete or modify any of the terms or conditions of the EULA; rather, no amendment to a EULA shall
be effective unless agreed to in writing and signed by an officer of Seller.

 

ARTICLE
III

PROMOTION
AND MARKETING

 

Section
3.01 Master Distributor Performance Obligations. Master Distributor shall:

 

(a) use
commercially reasonable efforts to market, promote, and sublicense Platform Subscriptions to Customers;

 

(b) maintain
a place or places of business, as required for Master Distributor to perform its duties under this Agreement;

 

(c) establish
and maintain a sales and marketing organization sufficient to develop the market potential for the sublicense of Platform Subscriptions;

 

(e)
create and launch marketing, promotion, and sales materials, campaigns, and programs to promote sublicenses of Platform Subscriptions
to Customers; and

 

(f) 
not make any false or misleading representations or warranties to any Customer regarding Seller or the Platform‌

 

Section
3.02 Seller Performance Obligations. Seller shall:

 

(a)
provide any necessary information, material, and support as Master Distributor may reasonably request regarding the marketing,
promotion, and sublicense of Platform Subscriptions and shall notify Master Distributor promptly in the event of any material
changes in such information;

 

    6

    	 

    

 

(b) provide
Master Distributor such marketing, promotional, sales, and technical literature related to the Platform as Master Distributor
may reasonably consider necessary to assist with the promotion of the Platform and the sublicense of Platform Subscriptions;‌

 

(c)
allow Master Distributor to participate in any marketing, promotion, and sales programs, campaigns, or events that Seller may
make generally available to its authorized distributors of Platform Subscriptions; and

 

Section
3.03 Platform Branding. All Platform Solutions sublicensed to any Customer by Master Distributor will be branded “InReality
Platform Software Subscriptions – xxxx”, provided that Master Distributor may include reference to itself as the “supplier”
of the Platform Subscriptions in any branding or marketing context.

 

ARTICLE
IV

SUBLICENSE
OF PLATFORM SUBSCRIPTIONS

 

Section
4.01 Sublicenses by Master Distributor. Master Distributor may sell Platform Subscriptions to Customers within
the Territory for use with any Hardware Solution. Master Distributor will have absolute and sole discretion over the price for
which Master Distributor sells Platform Subscriptions to Customers. Nothing herein will limit Master Distributor’s right
to charge End Users an activation fee in connection with a Platform Subscription sold by Master Distributor or by a Distributor
or CRI-Sourced Reseller. Nothing in this Agreement shall obligate Master Distributor to sublicense any minimum amount or quantity
of Platform Subscriptions.

 

Section
4.02 Activation, License, Subscription and Payment Terms. For each Platform Subscription that Master Distributor sublicenses
to a Customer after the Master Distributor has sublicensed the initial 3,300 units of the Goods purchased from Seller under the
Prior Agreement (the “Initial Goods”), Master Distributor shall pay Seller the subscription fee for the applicable
Subscription Level set forth on Schedule 1 hereto.

 

For
each Platform Subscription that Master Distributor sublicenses to a Customer following the Effective Date of this Agreement but
before Master Distributor’s has sublicensed all of the Initial Goods , Master Distributor shall pay Seller the Subscription
Fees set forth on Schedule 1 hereto.

 

For
each Platform Subscription that Master Distributor sublicensed to a Customer prior to the Effective Date of this Agreement, Master
Distributor has or shall pay Seller Activation and Subscription Fees as set forth in the “Prior Seller Royalty” fees
table on Schedule 1 hereto.

 

Master
Distributor shall complete and deliver to Seller a subscription license request form and a purchase order at the time of sale.
Seller will assign the appropriate license to the specified End User account within two business days after receiving such documents
from Master Distributor. Master Distributor shall pay Seller all properly invoiced amounts within thirty (30) days after receipt
of such invoice. Purchase orders for renewals of subscription licenses must be made at least thirty (30) days prior to end of
original subscription period to prevent a lapse in service provided thereunder.

 

    7

    	 

    

 

Section
4.03 Intentionally left blank

 

Section
4.04 Availability/Changes in the Platform. Seller shall:

 

(a)
provide and implement such updates to the Platform, and on such schedule, as reasonably necessary to maintain the full operation
and functionality of the Platform in accordance with its documentation, and notify Master Distributor at least seven (7) days
before the date of any such update;

 

(b) provide
Master Distributor at least thirty (30) days’ Notice before the date that Seller introduces any new version of the Platform,
a new software service or platform similar to the Platform, or replacement of the Platform and make such good available for resale
by Master Distributor on or before the date it is first introduced in the marketplace; and

 

(c)
not discontinue the Standard and Enhanced Temperature Screening Subscription Levels or the Platform within twelve (12) months
after the effective date of the termination of this Agreement.

 

Section
4.05 Platform Support. 

 

(a)
End Users. Master Distributor shall perform first level ongoing technical support with respect to the Platform for
End Users who have purchased a Platform Subscription from Master Distributor or Distributor in compliance with Service Level Agreement
substantially in the form attached hereto as Exhibit A, as it may be amended from time to time (the “SLA”);
provided, however, that Seller shall be solely responsible for, and shall promptly provide at its sole cost and
expense, all technical support with respect to the Platform for all issues that (a) render the Platform or Platform Subscription
fully or substantially inoperable or inaccessible; (b) prevent the Platform or Platform Subscription from functioning in accordance
with its documentation; (c) prevent End Users from using any of the major features or functionalities of the Platform or Platform
Subscription in accordance the documentation (i.e., “Tier 3 Issues”); provided that technical support for such
Tier 3 Issues shall not include resolution of the above Tier 3 Issues which result from (i) third-party software, or hardware,
provided that Seller will provide reasonable assistance to work with any other third-party software supplier to resolve any issue
(ii) any non-Seller modification to the Platform, (iii) use of the Platform by a Customer or End User which is not in accordance
with the documentation, or (iv) for which the Customer or Master Distributor has failed to pay the appropriate fees for the applicable
period. Unless determined to be the result of a failure to meet the Platform documentation, Seller’s support of Tier 3 issues
will not include troubleshooting or determination of the origin of whether the error is attributable to the Platform, custom software
development requested by Master Distributor or Customer or third party software or hardware. For purposes of this Section 4.05,
Master Distributor and Seller, respectively, shall be responsible only for their respective costs and expenses arising from their
respective duties under this Section 4.05 and the SLA. Seller will not be entitled to any fees received by Master Distributor
from End Users in connection with any technical support performed by Master Distributor.

 

    8

    	 

    

 

(b)
Distributors and Resellers. Master Distributor shall perform technical support, training, and end user demonstration
support for Distributors and CRI-Sourced Resellers; provided, however that Seller shall be solely responsible for,
and shall promptly provide at its sole cost and expense, all technical support related to Tier 3 Issues for Distributors and CRI-Sourced
Resellers with respect to the Platform or a Platform Subscription.

 

Section
4.06 Customer Referrals. Seller may, at its sole discretion, refer and direct each End User (whether such End User purchases
Hardware Solutions directly from Seller, directly or indirectly through the Master Distributor or otherwise, and whether or not
the End User is located in the Territory) to the Master Distributor for Platform Subscriptions.

 

Section
4.07 Cooperation by Seller. Upon Master Distributor’s request, and at Seller’s discretion, sole cost, and expense,
Seller shall provide strategic input, strategy implementation guidance, and such other material support reasonably requested by
Master Distributor with respect to Master Distributor’s relationships with any particular Customer, including without limitation
with respect to training and product demonstration support. Seller shall make itself available for at least one two-hour meeting
with Master Distributor per week during normal business hours, Monday through Friday throughout the Term to discuss the status
of Master Distributor’s distributor and reseller programs and any current or upcoming support and strategic needs of Master
Distributor related thereto. Master Distributor commits to holding these sessions at minimum twice a month.

 

Section
4.08 Platform Warranties. Seller warrants to Master Distributor that (a) none of the Platform, the Platform Subscriptions,
nor the marketing, sublicense, or use of the Platform or Platform Subscriptions infringes on any third-party Intellectual Property
Rights; (b) the Platform and Platform Subscriptions contain no harmful code.

 

ARTICLE
V

GOODS

 

Section
5.01 Goods Purchased under Prior Agreement. With respect to any Goods purchased by Master Distributor from Seller associated
with Prior Agreement, Master Distributor will look for resolution on Product Warranty and Defects from the original equipment
manufacturer directly, not from Seller.

 

Section
5.02 Purchase of Goods. From and after the Effective Date, Master Distributor shall purchase all Goods that it desires, if
any, directly from the manufacturer of such Goods (the “Manufacturer”). Nothing in this Agreement shall obligate
Master Distributor to purchase any minimum number or quantity of Goods. For each Good ordered by Master Distributor from a Manufacturer,
Seller shall perform an on-site quality control check (“Quality Control”) at such Manufacturer’s facility.

 

    9

    	 

    

 

Section
5.03 Seller Broker Services. Master Distributor shall have the option to require Seller, and Seller shall have the option
to accept, to act as Master Distributor’s broker with respect to any particular Manufacturer. Master Distributor may exercise
this option with respect to a Manufacturer upon Notice to Seller. Upon Seller’s receipt of such Notice, Seller shall be
responsible for (a) remitting any payments due from Master Distributor to the Manufacturer, which payments shall be made in advance
to the Seller; (b) coordinating manufacturing and other activities with Manufacturer; (c) coordinating shipping of Goods from
the Manufacturer to Master Distributor; (d) scheduling and coordinating Seller’s performance of its Quality Control duties;
and (e) coordinating any additional work required to effectuate Master Distributor’s purchase and receipt of the Goods from
the Manufacturer (collectively, the “Broker Services”). If and only if Master Distributor exercises the option
set forth in this Section 5.03 and Seller performs the Broker Services to Master Distributor’s satisfaction, Master
Distributor shall pay Seller the broker fee set forth on Schedule 3 hereto (the “Broker Fee”) for each
Good for which Seller provided the Broker Services within thirty (30) days after the date that Master Distributor orders the Good
to which the Broker Services apply.

 

Section
5.04 License Fees and Handling Costs. For each Good sold to an End User by Master Distributor, a Distributor, or a CRI-Sourced
Reseller following the sale of all of the Initial Goods (each, a “CRI-Originated Good”), Master Distributor
shall pay Seller the applicable license fee set forth on Schedule 3 (the “License Fee”). The License
Fee will accrue at the time the CRI-Originated Goods leave Master Distributor’s inventory, including for CRI-Originated
Goods sold to Customers, End Users, or used for internal purposes. No later than the last day of each calendar month during the
Term, Master Distributor shall submit to Seller a written record of all recorded sales of CRI-Originated Goods during such month
(the “Monthly License Report”), along with a calculation of all License Fees incurred for such sales during
the month (the “Monthly License Fees”). Master Distributor shall pay all Monthly License Fees within thirty
(30) days after the date of each Monthly License Report.

 

Section
5.05 Handling Costs. For each Good ordered by, delivered to, and accepted by Master Distributor from a Manufacturer, Master
Distributor shall pay Seller the handling costs set forth on Schedule 3 (the “Handling Costs”). Master
Distributor shall pay Seller the Handling Costs within thirty (30) days after the date that original equipment manufacturer ships
the Good to which the Handling Costs apply.

 

ARTICLE
VI

USE
OF SELLER’S INTELLECTUAL PROPERTY

 

Section
6.01 Use of Seller’s Name and Trademarks. Master Distributor and its authorized independent sales representatives,
distributors, resellers, referral partners, successors, and assigns are authorized and licensed to:

 

(a) use
Trademarks, service marks and trade names of Seller and any third party licensed by Seller in connection with marketing, promoting,
or reselling the Goods and the Platform; and

 

(b)
refer to itself as an authorized distributor of the Goods and the Platform without limitation in the Territory.

 

    10

    	 

    

 

Section
6.02 Use of Master Distributor’s Name and Trademarks. Seller is authorized and licensed to use Trademarks, service marks,
and trade names of Master Distributor solely in connection with marketing and promoting the Goods, the Platform, and the Platform
Subscriptions.

 

Section
6.03 Limited Have Made Rights. Master Distributor is granted a license to make and have made Goods under any Patent of Seller
that is used in, implicated by, or otherwise connected with the manufacturing and production of Goods.

 

Section
6.04 Ownership. Subject to the license and sublicense rights granted herein, Seller is the sole owner of all Intellectual
Property Rights in the Platform and Master Distributor acknowledges and agrees that this Agreement grants Reseller no title or
right of ownership in or to the Platform. Master Distributor shall not, at any time, take or cause any action, which would be
inconsistent with or tend to impair the rights of Seller or its licensors in the Platform.

 

ARTICLE
VII

TERM;
TERMINATION

 

Section
7.01 Initial Term. The term of this Agreement shall commence on the Effective Date and will continue for a period
of twelve (12) months thereafter, unless and until earlier terminated as provided under this Agreement or applicable Law (the
“Initial Term”).

 

Section
7.02 Renewal Term. Upon expiration of the Initial Term, this Agreement will automatically renew for additional
successive twelve (12) month terms unless and until (a) Master Distributor provides Notice of nonrenewal at least sixty (60) days
before the end of the then-current term or (b) Seller provides Notice of nonrenewal at least six (6) months before the end of
the then-current term or (c) earlier terminated as provided under this Agreement or applicable Law (each, a “Renewal
Term”, and together with the Initial Term, the “Term”). If the Term is renewed for any Renewal Term(s)
pursuant to this Section 7.02, the terms and conditions of this Agreement during each such Renewal Term are the same as
the terms in effect immediately prior to such renewal, subject to any change agreed to by the Parties in accordance with Section
13.07. If Master Distributor or Seller provides timely Notice of its intent not to renew this Agreement, then, subject to
Section 7.01, unless earlier terminated in accordance with its terms, this Agreement will terminate on the expiration of
the then-current Term.‌

 

Section
7.03 Master Distributor’s Right to Terminate the Agreement. Master Distributor may terminate this Agreement
upon Notice to Seller:

 

(a) if
Seller repudiates any of its obligations under this Agreement;

 

(b) except
as otherwise specifically provided under this Section 7.03, if Seller is in material breach of any representation, warranty,
or covenant of Seller under this Agreement and either the breach cannot be cured or, if the breach can be cured, it is not cured
by Seller within a commercially reasonable period of time under the circumstances, in no case exceeding fifteen (15) days following
Seller’s receipt of Notice of such breach; or

 

    11

    	 

    

 

(c) if
Seller:

 

(i) becomes
insolvent or is generally unable to pay, or fails to pay, its debts as they become due;

 

(ii) files
or has filed against it, a petition for voluntary or involuntary bankruptcy, or otherwise becomes subject, voluntarily or involuntarily,
to any proceeding under any domestic or foreign bankruptcy or insolvency Law;

 

(iii) seeks
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect to it
or its debts;

 

(iv) makes
or seeks to make a general assignment for the benefit of its creditors; or

 

 (v) applies
for or has a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction to take
charge of or sell any material portion of its property or business;

 

(d) in
the event of a Force Majeure Event affecting Seller’s performance of this Agreement for more than fifteen (15) consecutive
days;

 

(e) if,
without obtaining Master Distributor’s prior written consent, (i) Seller sells, leases or exchanges a material portion of
Seller’s assets, (ii) Seller merges or consolidates with or into another Person, or (iii) a change in Control of Seller
occurs, unless in the case of a merger or consolidation of Seller with another Person, Seller is the surviving entity and has
a net worth greater than or equal to its net worth immediately prior to the merger or consolidation; or

 

(h) at
its option and for any reason upon ninety (90) days’ written notice to Seller.

 

Any
termination under this Section 7.03 is effective on Seller’s receipt of Master Distributor’s Notice of termination
or any later date set out in the Notice.

 

Section
7.04 Seller’s Right to Terminate for Cause. Seller may terminate this Agreement upon Notice to Master Distributor:

 

(a) except
as otherwise specifically provided under this Section 7.04, if Master Distributor is in material breach of any representation,
warranty, or covenant of Master Distributor under this Agreement, and either the breach cannot be cured or, if the breach can
be cured, it is not cured by Master Distributor within a commercially reasonable period of time (in no case exceeding fifteen
(15) days after Master Distributor’s receipt of Notice of such breach).

 

    12

    	 

    

 

(b) if
Master Distributor:

 

(i) becomes
insolvent or is generally unable to pay, or fails to pay, its debts as they become due;

 

(ii) files
or has filed against it, a petition for voluntary or involuntary bankruptcy or otherwise becomes subject, voluntarily or involuntarily,
to any proceeding under any domestic or foreign bankruptcy or insolvency Law;

 

(iii) seeks
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect to it
or its debts;

 

(iv) makes
or seeks to make a general assignment for the benefit of its creditors; or

 

(v) applies
for or has appointed a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction
to take charge of or sell any material portion of its property or business.

 

Any
termination under this Section 7.04 is effective on Master Distributor’s receipt of Seller’s Notice of termination
or any later date set out in the Notice.

 

Section
7.05 Effect of Expiration or Termination.

 

(a) Upon
the expiration or earlier termination of this Agreement:

 

(i) each
Party shall promptly return to the other Party or destroy all documents and tangible materials (and any copies thereof) containing,
reflecting, incorporating, or based on the other Party’s Confidential Information;

 

(ii) each
Party shall promptly permanently erase all of the other Party’s Confidential Information from its computer systems, except
for copies that are maintained as archive copies on its disaster recovery and/or information technology backup systems. Each Party
shall destroy any such copies upon the normal expiration of its backup files; and

 

(iii) each
Party shall promptly certify in writing to the other Party that it has complied with the requirements of this clause.

 

(b) The
Party terminating this Agreement, or in the case of the expiration of this Agreement, each Party, shall not be liable to the other
Party for any damage of any kind (whether direct or indirect) incurred by the other Party by reason of the expiration or earlier
termination of this Agreement. Termination of this Agreement will not constitute a waiver of any of the terminating Party’s
rights or remedies under this Agreement, at law, in equity, or otherwise.

 

(c)
Notwithstanding the provisions of Section 13.03, in the case that this Agreement is terminated for any reason, the Parties
shall continue to perform such obligations and provide such services under this Agreement as necessary to ensure that the Platform
and the Software continue to operate for the remainder of the then current term of the existing End User contracts for Platform
Subscriptions in same condition as if this Agreement were still fully in effect.

 

    13

    	 

    

 

ARTICLE
VIII

CONFIDENTIALITY

 

Section
8.01 Scope of Confidential Information. From time to time during the Term, either Party (as the “Disclosing
Party”) may disclose or make available to the other Party (as the “Receiving Party”) information
about its business affairs, goods and services, Forecasts, confidential information, and materials comprising or relating to Intellectual
Property Rights, Trade Secrets, third-party confidential information, and other sensitive or proprietary information; such information,
whether orally or in written, electronic, or other form or media, and whether or not marked, designated, or otherwise identified
as “confidential” constitutes “Confidential Information” hereunder. Confidential Information excludes
information that, at the time of disclosure and as established by documentary evidence:

 

(a) is
or becomes generally available to and known by the public other than as a result of, directly or indirectly, any breach of this
Article XIII by the Receiving Party or any of its Representatives;

 

(b) is
or becomes available to the Receiving Party on a non-confidential basis from a third-party source, provided that such third party
is not and was not prohibited from disclosing such Confidential Information;

 

(c) was
known by or in the possession of the Receiving Party or its Representatives before being disclosed by or on behalf of the Disclosing
Party; or

 

(d) was
or is independently developed by the Receiving Party without reference to or use of, in whole or in part, any of the Disclosing
Party’s Confidential Information.

 

Section
8.02 Protection of Confidential Information. The Receiving Party shall:

 

(a) protect
and safeguard the confidentiality of the Disclosing Party’s Confidential Information with at least the same degree of care
as the Receiving Party would protect its own Confidential Information, but in no event with less than a commercially reasonable
degree of care;

 

(b) not
use the Disclosing Party’s Confidential Information, or permit it to be accessed or used, for any purpose other than to
exercise its rights or perform its obligations under this Agreement; and

 

(c) not
disclose any such Confidential Information to any Person, except:

 

(i) to
the Receiving Party’s Representatives who need to know the Confidential Information to assist the Receiving Party, or act
on its behalf, to exercise its rights or perform its obligations under this Agreement;

 

(ii) pursuant
to applicable Law, provided that the Receiving Party shall first provide the Disclosing Party with: (A) prompt Notice of such
requirement so that the Disclosing Party may seek, at its sole cost and expense, a protective order, or other remedy; and (B)
reasonable assistance, at the Disclosing Party’s sole cost and expense, in opposing such disclosure or seeking a protective
order or other limitations on disclosure; or

 

(iii)
pursuant to Master Distributor’s obligations under the applicable securities Laws and the regulations of any exchange on
which Master Distributor’s securities are traded.

 

The
Receiving Party shall be responsible for any breach of this Article XIII caused by any of its Representatives. The provisions
of this Article XIII shall survive termination or expiration of this Agreement for any reason for a period of two (2) years
after such termination or expiration. On the expiration or earlier termination of this Agreement, the Receiving Party and its
Representatives shall, pursuant to Section 7.05(a), promptly return or destroy all Confidential Information and copies
thereof that it has received under this Agreement.

 

ARTICLE
IX

REPRESENTATIONS
AND WARRANTIES

 

Section
9.01 Seller’s Representations and Warranties. Seller represents, warrants, and covenants to Master Distributor
that:

 

(a) it
is a limited liability company organized, validly existing, and in good standing in the jurisdiction of its organization/formation;

 

(b) it
is duly qualified to do business and is in good standing in every jurisdiction in which such qualification is required or purposes
of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to adversely
affect its ability to perform its obligations under this Agreement;

 

(c) it
has the full right, power, and authority to enter into this Agreement, to grant the rights and licenses granted under this Agreement,
and to perform its obligations under this Agreement;

 

(d) the
execution of this Agreement by its Representative whose signature is set forth at the end hereof has been duly authorized by all
necessary action of Seller; 

 

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(e)
the execution, delivery, and performance of this Agreement by Seller will not violate, conflict with, require consent under, or
result in any breach or default under:

 

(i)
any of Seller’s organizational documents;

 

(ii)
any applicable Law; or

 

(iii)
with or without notice or lapse of time or both, the provisions of any Seller Contract;

 

(f) when
executed and delivered by each of Master Distributor and Seller, this Agreement will constitute the legal, valid, and binding
obligation of Seller, enforceable against Seller in accordance with its terms, except as may be limited by any applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws and equitable principles related to or affecting creditors’ rights
generally or the effect of general principles of equity; and

 

(g) it
is now and at all times will remain in material compliance with all Laws and Seller Contracts applicable to this Agreement, the
Goods, the Software, the Platform, and the operation of its business.

 

EXCEPT
AS EXPRESSLY SET FORTH IN THIS SECTION 9.01 and 9.02, Seller EXPRESSLY DISCLAIMS ALL WARRANTIES AND REPRESENTATIONS, EXPRESS OR
IMPLIED, CONCERNING THE GOODS, SERVICES AND DELIVERABLES, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF FITNESS FOR
A PARTICULAR PURPOSE, MERCHANTABILITY OR OTHERWISE ARE HEREBY DISCLAIMED.

 

Section
9.02 Master Distributor’s Representations and Warranties. Master Distributor represents, warrants, and covenants
to Seller that:

 

(a) it
is a corporation duly organized, validly existing, and in good standing in the jurisdiction of its incorporation;

 

(b) it
is duly qualified to do business and is in good standing in every jurisdiction in which such qualification is required for purposes
of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to adversely
affect its ability to perform its obligations under this Agreement;

 

(c) it
has the full right, power and authority to enter into this Agreement, to grant the rights and licenses granted under this Agreement,
and to perform its obligations under this Agreement;

 

(d) the
execution of this Agreement by its Representative whose signature is set forth at the end hereof has been duly authorized by all
necessary action of Master Distributor;

 

    15

    	 

    

 

(e) the
execution, delivery, and performance of this Agreement by Master Distributor will not violate, conflict with, require consent
under, or result in any breach or default under:

 

(i) any
of Master Distributor’s organizational documents;

 

(ii) any
applicable Law; or

 

(iii) with
or without notice or lapse of time or both, the provisions of any Master Distributor Contract; and

 

(f) when
executed and delivered by each of Seller and Master Distributor, this Agreement will constitute the legal, valid, and binding
obligation of Master Distributor, enforceable against Master Distributor in accordance with its terms, except as may be limited
by any applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws and equitable principles related to or affecting
creditors’ rights generally, or the effect of general principles of equity.

 

(g) it
is now and at all times will remain in material compliance with all Laws of the Territory and Master Distributor Contracts applicable
to this Agreement and the operation of its business.

 

ARTICLE
X

INDEMNIFICATION

 ‌

Section
10.01 Indemnification.

 

(a) Master
Distributor shall indemnify, defend, and hold harmless Seller and its Representatives, officers, directors, employees, agents,
Affiliates, distributors, resellers, referral partners (and, for each of the foregoing that is an entity, their respective officers,
directors, employees, and agents), successors, and permitted assigns (collectively, “Seller Indemnitees”) against
any and all losses, damages, liabilities, deficiencies, claims, actions, judgments, settlements, interest, awards, penalties,
fines, costs, or expenses of whatever kind, including attorneys’ fees, fees and the costs of enforcing any right to indemnification
under this Agreement, and the cost of pursuing any insurance providers (collectively, “Losses”), incurred by
a Seller Indemnitee or awarded against a Seller Indemnitee, relating to, arising out of, or resulting from any Claim of a third
party alleging: (a) breach or non-fulfillment of any representation, warranty, or covenant of this Agreement by Master
Distributor or Master Distributor’s Personnel; (b) any negligent or more culpable act or omission of Master Distributor
or its Personnel (including any recklessness or willful misconduct) in connection with the performance of its obligations under
this Agreement; (c) any bodily injury, death of any Person, or damage to real or tangible personal property caused
by the willful or negligent acts or omissions of Master Distributor or its Personnel; or (d) any failure by Master Distributor
or its Personnel to comply with any applicable Laws.

 

    16

    	 

    

 

(b) Seller
shall indemnify, defend, and hold harmless Master Distributor and its Representatives, officers, directors, employees, agents,
Affiliates, distributors, resellers, referral partners (and, for each of the foregoing that is an entity, their respective officers,
directors, employees, and agents), successors, and permitted assigns (collectively, “Master Distributor Indemnitees”)
against any and all Losses incurred by a Master Distributor Indemnitee or awarded against a Master Distributor Indemnitee, relating
to, arising out of, or resulting from any Claim of a third party alleging: (a) breach or non-fulfillment of any representation,
warranty, or covenant of this Agreement by Seller or Seller’s Personnel; (b) any negligent or more culpable act
or omission of Seller or its Personnel (including any recklessness or willful misconduct) in connection with the performance of
its obligations under this Agreement; (c) any bodily injury, death of any Person, or damage to real or tangible personal
property caused by the willful or negligent acts or omissions of Seller or its Personnel; or (d) any failure by Seller or
its Personnel to comply with any applicable Laws.

 

10.02 Exceptions
and Limitations on Indemnification. Notwithstanding anything to the contrary in this Agreement, the indemnifying party is
not obligated to indemnify or defend a indemnified party against any claim (whether direct or indirect) if such claim or corresponding
Losses directly result from the indemnified party or its indemnitee’s or its Personnel’s: (a) gross negligence
or more culpable act or omission (including recklessness or willful misconduct); or (b) bad faith failure to comply
with any of its obligations set forth in this Agreement.

 

Section
10.03 Seller Intellectual Property Indemnification. Subject to the terms and conditions of Section 10.04,
Seller shall defend, hold harmless, and indemnify Master Distributor Indemnitees from and against all Losses arising out of any
third-party Claim alleging that any of the Goods, Software, Platform, Platform Subscriptions, or Master Distributor’s receipt
or use thereof infringes any Intellectual Property Right; provided that the indemnification obligations under the
foregoing clause shall not apply to infringement actions or claims to the extent that such actions or claims are based on or result
from: (i) the use of any Goods, Software, Platform in violation of the terms of this Agreement or the Seller’s Terms of
Use for the Goods, Software or Platform, (ii) any alteration or modification of the Goods, Software or Platform by any person
other than by, on behalf or at the direction of Seller or its authorized agent, and provided the loss in question would not have
occurred, in whole or in part, but for such unauthorized alteration or modification, (iii) any combination, operation or use of
the Goods, Software or Platform with equipment or software not supplied, recommended or approved in writing by Seller (for clarity,
Seller has approved the use of Goods with the Software and Platform), unless such use is performed by, on behalf or at the direction
of Seller or its affiliates, and provided the loss in question would not have occurred, in whole or in part, but for such unsanctioned
use, or (iv) compliance with information, directions, specifications or materials provided by Master Distributor or other sub
distributor or reseller. In addition, if such a Claim is or is likely to be made, Seller shall, at its own expense, exercise the
following as determined in the Seller’s discretion: (a) obtain for Master Distributor and its End Users the respective
rights to continue to use and sell the Goods, sublicense the Platform, and the Platform Subscriptions consistent with this Agreement;
(b) modify the Goods, Software, Platform, or Platform Subscriptions, as applicable, so they are non-infringing and in compliance
with this Agreement; (c) replace the Goods, Software, Platform, or Platform Subscriptions with non-infringing ones that comply
with this Agreement; or (d) accept the cancellation and return (at Seller’s expense) of infringing Goods, Software, Platform,
or Platform Subscription without Master Distributor or End Users having any cancellation liability and refund to Master Distributor
and End Users any amount paid for such infringing Goods. If the Goods, Software, Platform, or Platform Subscriptions, or any part
thereof, become, or in Seller’s opinion are likely to become, subject to a Claim that qualifies for intellectual property
indemnification coverage under this Section 10.03, Seller shall, at its sole option and expense, Notify Master Distributor
and End Users to cease using such Goods, Software, Platform, or Platform Subscription. Master Distributor shall Notify Seller
of third-party Claims against Master Distributor and reasonably cooperate in the investigation, settlement, and defense of such
Claims at Seller’s expense.

 

    17

    	 

    

 

Section
10.04 Exceptions to Seller’s Intellectual Property Indemnification. Notwithstanding anything to the contrary
in this Agreement, Seller is not obligated to indemnify or defend any Master Distributor Indemnitee against any claim under Section
10.03 if such claim or corresponding Losses arise out of or result from the circumstances described in Section 10.02(a)
or Section 10.02(b).

 

ARTICLE
XI

LIMITATION
OF LIABILITY

 

Section
11.01 No Liability for Consequential or Indirect Damages. EXCEPT FOR LIABILITY FOR INDEMNIFICATION, LIABILITY
FOR BREACH OF CONFIDENTIALITY, LIABILITY FOR BREACH OF NON-SOLICITATION OBLIGATIONS, OR LIABILITY FOR INFRINGEMENT OR MISAPPROPRIATION
OF INTELLECTUAL PROPERTY RIGHTS, NEITHER PARTY NOR ITS REPRESENTATIVES SHALL BE LIABLE FOR CONSEQUENTIAL, INDIRECT, INCIDENTAL,
SPECIAL, EXEMPLARY, PUNITIVE, OR ENHANCED DAMAGES, ARISING OUT OF OR RELATING TO ANY BREACH OF THIS AGREEMENT, WHETHER OR NOT
THE POSSIBILITY OF SUCH DAMAGES HAS BEEN DISCLOSED IN ADVANCE TO A PARTY OR COULD HAVE BEEN REASONABLY FORESEEN BY SUCH PARTY,
REGARDLESS OF THE LEGAL OR EQUITABLE THEORY (CONTRACT, TORT, OR OTHERWISE) UPON WHICH THE CLAIM IS BASED, AND NOTWITHSTANDING
THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE. EXCEPT FOR LIABILITY FOR INDEMNIFICATION, LIABILITY FOR BREACH
OF CONFIDENTIALITY, LIABILITY FOR BREACH OF NON-SOLICITATION OBLIGATIONS, OR LIABILITY FOR INFRINGEMENT OR MISAPPROPRIATION OF
INTELLECTUAL PROPERTY RIGHTS, Under no circumstances whatsoever will EITHER PARTY be liable
for any AMOUNTS that will exceed in the aggregate the amounts paid or payable for goods shipped or services performed to Seller
the PRECEDING 12 months.

 

ARTICLE
XII

INSURANCE
OBLIGATIONS

 

Section
12.01 Insurance. Without limiting Seller’s indemnification obligations under this Agreement, during the
Term, Seller shall, at its own expense, maintain and carry in full force and effect at least the following types of insurance
coverage, subject to the requirements set forth in Section 12.02: (a)  commercial general liability with limits
of at least one million dollars ($1,000,000) per occurrence, including bodily injury, property damage covering the Goods and the
Platform, and advertising liability, which policy will also include contractual liability coverage insuring the activities of
Seller under this Agreement; (b)  worker’s compensation with limits no less than the minimum amount required by
applicable law; and (c)  umbrella (excess) liability for the coverage in Section 12.01(a), with limits of five
million dollars ($5,000,000) per occurrence.

 

    18

    	 

    

 

Section
12.02 Insurance Contract Requirements. Seller shall ensure that all insurance policies required pursuant to Section
12.01: (a) are issued by insurance companies reasonably acceptable to Master Distributor; (b) provide that such
insurance carriers give Master Distributor at least thirty (30) days’ prior Notice of cancellation or non-renewal of policy
coverage, provided that, prior to such cancellation, Seller has new insurance policies in place that meet the requirements of
this Article XII; (c) provide that such insurance be primary insurance and any similar insurance in the name of and/or
for the benefit of Seller shall be excess and non-contributory; (d) name Master Distributor and Master Distributor’s
Affiliates, including, in each case, all successors and permitted assigns, as additional insureds; and (e) waive any right
of subrogation of the insurers against Master Distributor or any of its Affiliates.

 

Section
12.03 Insurance Certificates. On Master Distributor’s reasonable request, Seller shall provide Master Distributor
with copies of the certificates of insurance and policy endorsements for all insurance coverage required by this Article XII,
and shall not do anything to invalidate such insurance. This Section 12.03 shall not be construed in any manner as waiving,
restricting, or limiting the liability of either Party for any obligations imposed under this Agreement (including but not limited
to, any provisions requiring a party hereto to indemnify, defend, and hold the other harmless under this Agreement).

 

ARTICLE
XIII

MISCELLANEOUS

 

Section
13.01 Further Assurances. Upon a Party’s reasonable request, the other Party shall, at its sole cost and
expense, execute and deliver all such further documents and instruments, and take all such further acts, necessary to give full
effect to this Agreement.

 

Section
13.02 Entire Agreement. This Agreement, including and together with any related exhibits, schedules, attachments,
and appendices, constitutes the sole and entire agreement of the Parties with respect to the subject matter contained herein and
therein, and supersedes all prior and contemporaneous understandings, agreements, representations, and warranties, both written
and oral, regarding such subject matter. Any additional or different terms or conditions contained in any document furnished by
Seller, including but not limited to, any purchase order or any acknowledgment, are hereby objected to and rejected by Master
Distributor. This Agreement supersedes the Prior Agreement in its entirety.

 

Section
13.03 Survival. Subject to the limitations and other provisions of this Agreement: (a) the representations and
warranties of the Parties contained herein shall survive the expiration or earlier termination of this Agreement; and (b) Articles,
VI, VIII, X, XI and Sections 5.01(a), 7.05, 13.04, 13.13, and 13.14
of this Agreement, as well as any other provision that, in order to give proper effect to its intent, should survive such
expiration or termination, shall survive the expiration or earlier termination of this Agreement. All other provisions of this
Agreement shall not survive the expiration or earlier termination of this Agreement.

 

    19

    	 

    

 

Section
13.04 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder (each,
a “Notice”, and with the correlative meaning, “Notify”) shall be in writing and shall be
deemed to have been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee
if sent by a nationally recognized overnight courier (return receipt requested); (c) if by email, including any attachments thereto,
on the date sent (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business
Day if sent after normal business hours of the recipient; or (d) on the third (3rd) day after the date mailed, by certified or
registered first class mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties
at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this
Section 13.04.

 

	 	Notice
        to Master Distributor:

         
	Creative
        Realities, Inc.

        13100
        Magisterial Drive, Suite 100

        Louisville,
        KY 40223

        Attn:
        Will Logan, Chief Financial Officer

	 	 	 
	 	 	E-mail:
    will.logan@cri.com
	 	 	 
	 	With
    a copy (which shall not constitute notice) to:	 

        Maslon
        LLP

	 	 	3300
        Wells Fargo Center

        90
        South 7th Street

	 	 	Minneapolis,
    MN 55402
	 	 	Attn:
    Bradley Pederson
	 	 	 
	 	 	E-mail:
    bradley.pederson@maslon.com
	 	 	 
	 	Notice
to Seller:
	[COMPANY
    ADDRESS]
	 	 	[E-mail:
    [E-MAIL ADDRESS]

  

Section
13.05 Headings. The headings in this Agreement are for reference only and do not affect the interpretation of
this Agreement.

 

Section
13.06 Severability. If any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction,
such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate
or render unenforceable such term or provision in any other jurisdiction. Upon a determination that any term or provision is invalid,
illegal, or unenforceable, this Agreement shall be modified to effect the original intent of the Parties as closely as possible
in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

 

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Section
13.07 Amendment and Modification. No amendment to or modification of this Agreement or any Purchase Order is effective
unless it is in writing and signed by an authorized Representative of each Party.

 

Section
13.08 Waiver. No waiver by any Party of any provision of this Agreement shall be effective unless it is in writing
and signed by the Party waiving its right. Any waiver authorized on one occasion is effective only in that instance and only for
the purpose stated, and does not operate as a waiver on any future occasion. None of the following constitutes a waiver or estoppel
of any right, remedy, power, privilege, or condition arising from this Agreement: (i) any failure or delay in exercising
any right, remedy, power, or privilege or in enforcing any condition under this Agreement; or (ii) any act, omission,
or course of dealing between the Parties.‌

 

Section
13.09 Cumulative Remedies. All rights and remedies provided in this Agreement are cumulative and not exclusive,
and the exercise by either Party of any right or remedy does not preclude the exercise of any other rights or remedies that may
now or subsequently be available at law, in equity, by statute, in any other agreement between the Parties, or otherwise.

 

Section
13.10 Assignment. Except as otherwise set forth in this Agreement, neither Party may assign this Agreement any
of its rights or delegate any of its obligations hereunder without the other Party’s prior written consent. Any purported
assignment or delegation in violation of this Section 13.10 shall be null and void.

 

‌Section
13.11 Successors and Assigns. This Agreement is binding on and inures to the benefit of the Parties to this Agreement
and their respective permitted successors and permitted assigns.

 

Section
13.12 No Third-Party Beneficiaries.

 

(a)
Subject to Section 13.12(b), this Agreement benefits solely the Parties to this Agreement and their respective permitted
successors and assigns and nothing in this Agreement, express or implied, confers on any other Person any legal or equitable right,
benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

 

(b)  The
Parties hereby designate distributors, sub-distributors, resellers, referral partners, Master Distributor Indemnitees, and End
Users as third-party beneficiaries with the right to enforce Section 2.02, Article X, and Section 5.01(a),
respectively, together with any related provision of this Agreement.

 

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Section
13.13 Dispute Resolution. Any dispute, controversy, or claim arising out of or relating to this Agreement, or
the breach, termination or invalidity hereof (each, a “Dispute”), shall be submitted for negotiation and resolution
to the Chief Executive Officer of Seller (or to such other person of equivalent or superior position designated by Seller in a
written Notice to Master Distributor) and the Chief Executive Officer of Master Distributor (or to such other person of equivalent
or superior position designated by Master Distributor in a written Notice to Seller), by delivery of written Notice (each, a “Dispute
Notice”) from either Party to the other Party. Such persons shall negotiate in good faith to resolve the Dispute. If
the Parties cannot resolve any Dispute within thirty (30) days after delivery of the applicable Dispute Notice, the Dispute shall
be resolved exclusively by arbitration to be conducted by and under the Commercial Arbitration Rules of the American Arbitration
Association, to be held in a neutral location to be agreed by the Parties, or in Minneapolis, Minnesota if the Parties cannot
agree on a neutral location, unless a Party is seeking injunctive relief, in which case the federal and state courts sitting in
the location of the defendant in such matter shall have exclusive jurisdiction. Such arbitration shall be commenced by the sending
of a written notice by the aggrieved Party to the other Party, setting forth a statement of the grievance. The mailing of such
notice shall commence the arbitration, and the award or decision in such arbitration shall be binding upon the Parties. Such award
or decision may be entered as a judgment in such court or courts as may have jurisdiction in the matter. The losing Party in any
action to enforce its rights or settle any disputes under this Agreement shall pay to the prevailing Party all of its costs and
expenses paid or incurred in connection with such suit or action, including, without limitation, the prevailing Party’s
reasonable attorneys’ fees, costs and expenses. THE PARTIES HEREBY INTENTIONALLY, KNOWINGLY AND VOLUNTARILY WAIVE ALL OF
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY PROCEEDING BROUGHT TO ENFORCE OR DEFEND ANY PROVISION CONTAINED IN THIS AGREEMENT.

 

Section
13.14 Governing Law. This Agreement, including all Purchase Order documents and exhibits, schedules, attachments,
and appendices attached to this Agreement and thereto, shall be governed by and construed in accordance with the Laws of the State
of Delaware, without regard to its choice or conflict of laws rules. The Parties agree that the United Nations Convention on Contracts
for the International Sale of Goods does not apply to this Agreement.

 

Section
13.15 Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all
of which together are deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, email,
or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this
Agreement.

 

Section
13.16 Force Majeure. Any delay or failure of either Party to perform its obligations under this Agreement will
be excused to the extent that the delay or failure was caused directly by an event beyond such Party’s control, without
such Party’s fault or negligence and that by its nature could not have been foreseen by such Party or, if it could have
been foreseen, was unavoidable (which events include, without limitation, natural disasters, embargoes, explosions, riots, wars,
or acts of terrorism, epidemics, pandemics (excluding the COVID-19 pandemic in effect as of the date hereof), or any action, order,
or other response by any federal, state, or local government authority related to any of the foregoing that directly prevents
a Party from performing its obligations) (each, a “Force Majeure Event”). Either Party’s financial inability
to perform, changes in cost or availability of materials, components, or services, market conditions or supplier actions or contract
disputes will not excuse performance by such Party under this Section 13.16. Each Party shall give the other prompt written
notice of any event or circumstance that is reasonably likely to result in a Force Majeure Event, and the anticipated duration
of such Force Majeure Event. Each Party shall use all diligent efforts to end the Force Majeure Event, ensure that the effects
of any Force Majeure Event are minimized and resume full performance under this Agreement.

 

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Section
13.17 No Franchise or Business Opportunity Agreement. The Parties are independent contractors and nothing in this
Agreement shall be deemed or constructed as creating a joint venture, employment, partnership, agency relationship, business opportunity,
or franchise between Seller and Master Distributor. Neither Party, by virtue of this Agreement, will have any right, power, or
authority to act or create an obligation, express or implied, on behalf of the other Party. Each Party assumes responsibility
for the actions of its personnel under this Agreement and will be solely responsible for their supervision, daily direction, and
control, wage rates, withholding income taxes, disability benefits, or the manner and means through which the work under this
Agreement will be accomplished. Except as provided otherwise in this Agreement, Master Distributor has the sole discretion to
determine Master Distributor’s methods of operation, Master Distributor’s accounting practices, the types and amounts
of insurance Master Distributor carries, Master Distributor’s personnel practices, Master Distributor’s marketing
and promotion, Master Distributor’s customers, and Master Distributor’s service areas and methods. The relationship
created hereby between the Parties is solely that of supplier and distributor. If any provision of this Agreement is deemed to
create a franchise or business opportunity relationship between the Parties, then the Parties shall negotiate in good faith to
modify this Agreement so as to effect the Parties’ original intent as closely as possible in a mutually acceptable manner
in order that the transactions contemplated hereby be consummated as a distribution agreement and not a franchise or business
opportunity agreement.

 

Section
13.18 Non-Solicitation.

 

(a) Neither
Party will solicit and/or offer employment to or hire as a contractor for service, nor accept for employment or hire as a contractor
for service, the other Party’s personnel, including independent contractors during the Term of this Agreement and for a
period continuing for twelve (12) months subsequent to the termination of the Agreement inclusive of any extension thereof; provided,
however, that the foregoing restriction shall not apply to solicitations directed at the public in general.

 

(b) During
the Term and for a period of twelve (12) months after the effective date of the termination of this Agreement, Seller shall not
(i) directly or intentionally indirectly through another Reseller solicit, accept, transact, or attempt to obtain business from
any Customer of Master Distributor; (ii) directly or intentionally indirectly through another Reseller assist or aid any other
party in the solicitation, acceptance or transaction of or any attempt to obtain the business of any Customer of Master Distributor;
or (iii) directly or intentionally indirectly through another Reseller accept the business of any Customer of Master Distributor
(it is the intention of the Parties that Seller may not avoid enforcement of the non-solicitation provisions set forth herein
by claiming that Seller merely accepted the business of any Customer of Master Distributor).

 

(c) The
Parties acknowledge that any breach of the non-solicitation provisions contained in this Section 13.18 may result in serious
and irreparable injury to the non-breaching Party. Therefore, the Parties acknowledge and agree that in the event of a breach
of the non-solicitation obligations set forth herein, the non-breaching Party shall be entitled, in addition to any other remedy
at law or in equity to which such Party may be entitled, to seek equitable relief against the breaching Party, including an injunction
to restrain such breaching Party from such breach and to compel compliance with the obligations hereunder, without any requirement
to post bond or other form of security. The right of the Parties to pursue equitable relief hereunder will not be subject to the
arbitration provisions set forth in Section 13.13.

 

[Signature
Page follows] 

 

    23

    	 

    

 

IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the Effective Date. 

 

	
         
	CREATIVE REALITIES, INC. 
	 	 
	 	By:	/s/ Richard C. Mills
	 	Name: 	Richard C. Mills
	 	Its:	CEO

 

	 	INREALITY, LLC 
	 	 	 
	 	By	/s/ Ronald A. Levac
	 	Name: 	Ronald A. Levac 
	 	
        Its:

        
	CEO

 

 

24Document

			
	
	THE L.S. STARRETT COMPANY and
	COMPUTERSHARE INC.
___________________________________

	AMENDED AND RESTATED RIGHTS AGREEMENT
	Dated as of October 30, 2020

TABLE OF CONTENTS
Page

						
	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 Shares of Class A Common Stock
	11

	Section 10.    Class A Common Stock Record Date
	11

	Section 11.    Adjustment of Purchase Price, Number of Shares or Number of Rights
	12

	Section 12.    Certificate of Adjusted Purchase Price or Number of Shares
	18

	Section 13.    Consolidation, Merger or Sale or Transfer of Assets or Earning Power
	18

	Section 14.    Fractional Rights and Fractional Shares
	19

	Section 15.    Rights of Action
	20

	Section 16.    Agreement of Right Holders
	20

	Section 17.    Right Certificate Holder Not Deemed a Shareholder
	21

	Section 18.    Concerning the Rights Agent
	21

	Section 19.    Merger or Consolidation or Change of Name of Rights Agent
	22

	Section 20.    Duties of Rights Agent
	22

	Section 21.    Change of Rights Agent
	26

	Section 22.    Issuance of New Right Certificates
	27

	Section 23.    Redemption
	27

	Section 24.    Exchange
	28

	Section 25.    Notice of Certain Events
	30

	Section 26.    Notices
	30

	Section 27.    Supplements and Amendments
	31

	Section 28.    Successors
	32

	Section 29.    Determinations and Actions by the Board; etc
	32

	Section 30.    Benefits of this Agreement
	32

	Section 31.    Severability
	32

	Section 32.    Governing Law
	32

	Section 33.    Counterparts; Effectiveness
	33

	Section 34.    Descriptive Headings
	33

	Section 35.    Force Majeure
	33

    -1-

Exhibit A – Form of Right Certificate
Exhibit B – Summary of Rights to Purchase Shares of Class A Common Stock

    -2-

AMENDED AND RESTATED RIGHTS AGREEMENT
This Amended and Restated Rights Agreement (the “Agreement”) is dated as of October 30, 2020 by and between The L.S. Starrett Company, a Massachusetts corporation (the “Company”), and Computershare Inc., a Delaware corporation, as rights agent (the “Rights Agent”).
WHEREAS, the Company entered into a Rights Agreement, dated as of November 2, 2010 (the “Original Agreement”).
    WHEREAS, on October 30, 2020, the Board of Directors determined it desirable and in the best interests of the Company and its stockholders that the Original Agreement be replaced and superseded in its entirety by the Agreement.
WHEREAS, the Board of Directors of the Company deemed it reasonable and in the best interests of the Company to authorize the issuance of rights (collectively, the “Rights” and each individually a “Right”), each Right being a right to purchase, on the terms and subject to the provisions of this Agreement, shares of the Company’s Class A Common Stock (as hereinafter defined) (or in certain circumstances provided in this Agreement, other securities of the Company or Common Shares or other securities of certain other Persons) and authorize and declare a dividend distribution of one Right for every share of Class A Common Stock and Class B Common Stock (as hereinafter defined) of the Company outstanding at the Close of Business (as hereinafter defined) on November 9, 2020 (the “Record Date”), and has further authorized and directed the issuance of one Right with respect to each share of Class A Common Stock and Class B Common Stock 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), and the Board of Directors of the Company also determined that the consideration to be received for any shares of Class A Common Stock issued pursuant to the terms and conditions set forth herein is adequate.
NOW, THEREFORE, in consideration of the premises and 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 and with any other Person with whom such Person is Acting in Concert, shall be the Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding, but shall not include (1) the Company, (2) any Subsidiary of the Company or (3) any employee benefit plan of the Company or of any Subsidiary of the Company, or any entity holding Common Shares for or pursuant to the terms of any such plan. Notwithstanding the foregoing, no Person shall become an “Acquiring Person” as the result of an acquisition of Common Shares by the Company that, 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, together with all Affiliates or Associates of such 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 paragraph (a), (i) has become such inadvertently or (ii) has become such as the result of contractual obligations that are or purport to be legally binding entered into prior to, and not materially amended or modified after, the date of this Agreement and has not acquired 1% or more of the Common Shares of the Company then outstanding by means other than such contractual obligations since the date of this Agreement, and in either of case (i) or (ii), such Person divests as promptly as practicable (but in the case of clause (ii), in no event later than 60 calendar days following the date of the acquisition of beneficial ownership that would otherwise cause such Person to be an Acquiring Person) 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 paragraph (a), then such Person shall not be deemed to be an “Acquiring Person” for any purposes of this Agreement.
A Person shall be deemed to be “Acting in Concert” with another Person if such Person knowingly acts (whether or not pursuant to an express agreement, arrangement or understanding) at any time after the first public announcement of the adoption of this Agreement, in concert or in parallel with such other Person, or towards a common goal with such other Person, relating to changing or influencing the control of the Company or in connection with or as a participant in any transaction having that purpose or effect, where (i) each Person is conscious of the other Person’s conduct and this awareness is an element in their decision-making processes and (ii) at least one additional factor supports a determination by the Board that such Persons intended to act in concert or in parallel, which such additional factors may include, without limitation, exchanging information, attending meetings, conducting discussions, or making or soliciting invitations to act in concert or in parallel; provided that the additional factor shall not include actions by an officer or director of the Company acting in such capacities. A Person who is Acting in Concert with another Person shall also be deemed to be Acting in Concert with any third party who is also Acting in Concert with such other Person.
No Person shall be deemed to be Acting in Concert with another Person solely as a result of (i) making or receiving a solicitation of, or granting or receiving, revocable proxies or consents given in response to a public proxy or consent solicitation made pursuant to, and in accordance with, Section 14(a) of the Exchange Act (as such term is hereinafter defined) by means of a solicitation statement filed on Schedule 14A, or (ii) soliciting or being solicited for, or tendering or receiving, tenders of securities in a public tender or exchange offer made pursuant to, and in accordance with, Section 14(d) of the Exchange Act by means of a tender offer statement filed on Schedule TO.
    -2-

(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)“Authorized Officer” shall mean any of the Chairman of the Board, the Chief Executive Officer, the President or any Vice President or the Clerk or any Assistant Clerk or the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary of the Company; 
(e)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); or
(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 l(d)(ii)(B) hereof) or disposing of any securities of the Company.
    -3-

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 that such Person would be deemed to own beneficially hereunder.
(f)“Business Day” shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in the State of New York or the State of New Jersey are authorized or obligated by law or executive order to close.
(g)“Class A Common Stock” shall mean the Class A Common Stock, par value $1.00 per share, of the Company.
(h)“Class A Common Stock Equivalents” shall have the meaning set forth in Section 11(b) hereof.
(i)“Class B Common Stock” shall mean the Class B Common Stock, par value $1.00 per share, of the Company.
(j)“Close of Business” on any given date shall mean 5:00 P.M., Boston, Massachusetts time, on such date; provided, however, that, if such date is not a Business Day, it shall mean 5:00 P.M., Boston, Massachusetts time, on the next succeeding Business Day.
(k)“Common Shares” when used with reference to the Company shall mean or shall include the shares of Class A Common Stock and Class B Common Stock.  “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 which ultimately control such first-mentioned Person.
(l)“Distribution Date” shall have the meaning set forth in Section 3(a) hereof.
(m)(1) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(n)“Exchange Ratio” shall have the meaning set forth in Section 24(a) hereof.
(o)“Final Expiration Date” shall have the meaning set forth in Section 7(a) hereof.
(p)“NYSE” shall mean The New York Stock Exchange.
(q)“Person” shall mean any individual, firm, corporation, partnership, limited liability company, joint venture, trust, association, unincorporated organization or other entity, and shall include any successor (by merger or otherwise) of such entity.
    -4-

(r)“Purchase Price” shall have the meaning set forth in Section 4 hereof.
(s)“Record Date” shall have the meaning set forth in the second paragraph hereof.
(t)“Redemption Date” shall have the meaning set forth in Section 7(a) hereof.
(u)“Redemption Price” shall have the meaning set forth in Section 23(a) hereof.
(v)“Right” shall have the meaning set forth in the second paragraph hereof.
(w)“Right Certificate” shall have the meaning set forth in Section 3(a) hereof.
(x)“Shares Acquisition Date” shall mean the first date of public announcement by the Company or an Acquiring Person that an Acquiring Person has become such.
(y)“Signature Guarantee” shall mean a guaranty of signature by an “eligible guarantor institution” that is a member of or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program.”
(z)“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.
(aa)“Summary of Rights” shall have the meaning set forth in Section 3(b) hereof.
(ab)“Trading Day” shall have the meaning set forth in Section 11(d) hereof.
Section 2.  Appointment of Rights Agent.  The Company hereby appoints the Rights Agent to act as rights agent for the Company in accordance with the express terms and conditions hereof (and no implied terms or conditions), and the Rights Agent hereby accepts such appointment.  The Company may from time to time, upon ten (10) days’ prior written notice to the Rights Agent, appoint such co-Rights Agents (“Co-Rights Agents”) as it may deem necessary or desirable.  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.  The respective duties of the Rights Agent and any such Co-Rights Agent shall be as the Company shall determine, provided that such duties and determination are consistent with the terms and provisions of this Agreement and that, contemporaneously with such appointment, the Company provides written notice thereof to the Rights Agent.
Section 3.  Issue of Right Certificates.  
    -5-

(a)From the date hereof until the tenth day after the Shares Acquisition Date (including any such date which is after the date of this Agreement and prior to the issuance of the Rights, the “Distribution Date”), (x) the Rights will be evidenced (subject to the provisions of Section 3(b) hereof) 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), or in the case of Common Shares held in uncertificated form, by the transaction statement or other record of ownership of such Common Shares, and not by separate Right Certificates, 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 by the Company and provided with a shareholder list and all necessary or relevant information and documents, at the Company’s expense, 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 stock transfer records of the Company or the transfer agent(s) or registrar for Common Shares, a Right Certificate in substantially the form of Exhibit A hereto (a “Right Certificate”), evidencing one Right (subject to adjustment) for each Common Share so held.  As of and after the Distribution Date, the Rights will be evidenced solely by such Right Certificates and the Rights shall be transferable only separately from the transfer of Common Stock.
The Company shall notify the Rights Agent in writing upon the occurrence of the Distribution Date and, if such notification is given orally, the Company shall confirm same in writing on or prior to the Business Day next following.  Until such written notice is received by the Rights Agent, the Rights Agent may assume conclusively for all purposes that the Distribution Date has not occurred.
i.On the Record Date, or as soon as practicable thereafter, the Company will send a copy of a Summary of Rights to Purchase Shares of Class A Common Stock, in substantially the form of Exhibit B hereto (the “Summary of Rights”), by first-class, postage-prepaid mail, to each record holder of Common Shares as of the Close of Business on the Record Date, at the address of such holder shown on the stock transfer records of the Company or the transfer agent(s) or registrar for Common Shares.  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 registered in the names of the holders thereof together with a copy of the Summary of Rights attached thereto.  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.
ii.In the case of certificates for Common Shares that become outstanding (including, without limitation, reacquired Common Shares referred to in the last sentence of this paragraph (c)) after the Record Date but prior to the earliest of the Distribution Date, the Redemption Date 
    -6-

or the Final Expiration Date, the Company shall cause them to have impressed on, printed on, written on or otherwise affixed to them a legend in substantially the following form:
This certificate also evidences and entitles the holder hereof to certain rights as set forth in an Agreement between The L.S. Starrett Company and Computershare Inc. (or any successor Rights Agent), dated as of October 30, 2020, 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 The L.S. Starrett Company.  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.  The L.S. Starrett Company 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.
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.  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 that are no longer outstanding.
Notwithstanding this Section 3(c), neither the omission of a legend nor the inclusion of a legend that makes reference to a rights agreement other than the Agreement shall affect the enforceability of any part of this Agreement or the rights of any holder of Rights (so long as the rights, duties or responsibilities of the Rights Agent are not affected).
Section 4.  Form of Right Certificates.  The Right Certificates (and the forms of election to purchase shares of Class A Common Stock and of assignment to be printed on the reverse thereof) shall be substantially in the form set forth in 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 (but which do not affect the rights, duties, liabilities or responsibilities of the Rights Agent) 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 Sections 7, 11 and 22 hereof, the Right Certificates shall entitle the holders thereof to purchase such number of shares of Class A Common Stock as shall be set forth therein at the price per one share of Class A Common Stock set forth therein (the “Purchase 
    -7-

Price”), but the number of such shares of Class A Common Stock issuable upon exercise of each Right and the Purchase Price shall be subject to adjustment as provided herein.
Section 5.  Countersignature and Registration.  The Right Certificates shall be executed on behalf of the Company by its Chairman of the Board, its President, its Treasurer or any Vice President, either manually or by facsimile or by electronic signature, shall have affixed thereto the Company’s seal or a facsimile thereof, and shall be attested by an authorized signatory of the Clerk or an Assistant Clerk of the Company, either manually or by facsimile or by electronic signature.  The Right Certificates shall be countersigned, either manually or by facsimile or by electronic signature, by the Rights Agent and shall not be valid for any purpose unless so 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 person is not such an officer.
Following the Distribution Date, receipt by the Rights Agent of notice to that effect and all other information and documents referred to in Section 3(a), the Rights Agent shall keep or cause to be kept, at the office of the Rights Agent designated for such purpose, 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.  Subject to the provisions of Section 14 hereof, at any time after the Close of Business on the Distribution Date, and at or prior to the Close of Business on the 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 null and void pursuant to Section 11(a)(ii) hereof or that have been exchanged pursuant to Section 24 hereof) 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 shares of Class A Common Stock 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 office of the Rights Agent designated for such purpose, accompanied by a Signature Guarantee and such other and further documentation as the Rights Agent or the Company may require.  The Right Certificates are transferable only on the registry books of the Rights Agent.  Neither the Rights Agent nor the Company shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered 
    -8-

Right Certificate or Right Certificates until the registered holder shall have (i) properly completed and duly executed the certificate contained in the form of assignment set forth on the reverse side of such Right Certificate, which shall be accompanied by a Signature Guarantee, (ii) provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) from whom the Rights evidenced by such Right Certificate are to be transferred (or the Beneficial Owner to whom such Rights are to be transferred) or Affiliates thereof as the Company or the Rights Agent shall reasonably request, and (iii) paid 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 as required by Section 9 hereof.  Thereupon, subject to Sections 5, 7(e) and 14 hereof, the Company shall execute and 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, registered in such name or names as may be designated by the surrendering registered holder.  The Rights Agent shall forward any such sum collected by it to the Company or to such Persons as the Company shall specify by written notice.  The Rights Agent shall have no duty or obligation under any Section of this Agreement that requires the payment of taxes or charges unless and until it is satisfied that all such taxes and/or charges have been paid in full.
Upon receipt by the Company and the Rights Agent of evidence satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate, and, in case of loss, theft or destruction, the receipt of indemnity or security satisfactory to them, and, at the Company’s or the Rights Agent’s request, and upon reimbursement to the Company and the Rights Agent of all expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, accompanied by a Signature Guarantee and such other and further documentation as the Rights Agent may require, the Company will make and deliver a new Right Certificate of like tenor to the Rights Agent for countersignature and delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
Notwithstanding any other provisions hereof, but subject to Section 27, the Company and the Rights Agent may amend this Agreement to provide for uncertificated Rights in addition to or in place of Rights evidenced by Right Certificates.
Section 7.  Exercise of Rights; Purchase Price; Expiration Date of Rights.  
iii.Except as otherwise 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 from and after the Distribution Date, upon surrender of the Right Certificate, with the form of election to purchase on the reverse side thereof properly completed and duly executed, to the Rights Agent at the office of the Rights Agent designated for such purpose, accompanied by a Signature Guarantee and such other documentation as the Rights Agent may require, together with payment in cash, only by electronic or wire transfer, or by certified check or bank check, of the Purchase Price with respect to the total number of shares of Class A Common Stock as to which the Rights are exercised (which payment shall include any additional amount payable by such Person in accordance with this Agreement), at or prior to the earliest of (i) the Close of Business on October 30, 2030 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof (the “Redemption Date”), or (iii) 
    -9-

the time at which such Rights are exchanged as provided in Section 24 hereof.  The Company shall provide the Rights Agent with a prompt written notice pursuant to Section 26 of the occurrence of any of the events provided for in this Section 7(a) (and the Rights Agent may conclusively assume that no such event has occurred until it receive such notice).
Except for such provisions herein that expressly survive the termination of this Agreement, this Agreement shall terminate at such time as the Rights are no longer exercisable hereunder.
iv.The Purchase Price for each share of Class A Common Stock purchasable pursuant to the exercise of a Right shall initially be $24.00, and shall be subject to adjustment from time to time as provided in Section 11 or 13 hereof, and shall be payable in lawful money of the United States of America in accordance with paragraph (c) below.
v.Subject to the other provisions of this Agreement, upon receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase set forth on the reverse side thereof properly completed and duly executed, accompanied by payment of the Purchase Price for the shares of Class A Common Stock to be purchased and an amount equal to any applicable tax or charge required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof by certified check, cashier’s check or money order payable to the order of the Rights Agent, the Rights Agent shall, subject to Sections 7(a), 11(a)(iii) and 20(k) hereof, thereupon promptly (i) (A) request from any transfer agent of the Class A Common Stock (or from the Company, if there shall be no such transfer agent, or make available if the Rights Agent is such transfer agent) certificates for the number of shares of Class A Common Stock to be purchased and the Company hereby irrevocably authorizes any such transfer agent to comply with all such requests, or (B) if the Company, in its sole discretion, shall have elected to deposit the shares of Class A Common Stock issuable upon exercise of the Rights hereunder with a depository agent under a depository arrangement and provides written notice of such election to the Rights Agent, request from the depositary agent depositary receipts representing such number of shares of Class A Common Stock as are to be purchased (in which case certificates for the shares of Class A Common Stock represented by such receipts shall be deposited by the transfer agent of the shares of Class A Common Stock with such depositary agent), and the Company hereby directs such depositary agent to comply with all such requests; (ii) when necessary to comply with this Agreement, after receipt, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional shares in accordance with Section 14 hereof; (iii) after receipt of such certificates or depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Right Certificate, registered in such name or names as may be designated by such holder; and (iv) when necessary to comply with this Agreement, after receipt, deliver such cash to or upon the order of the registered holder of such Right Certificate.  For purposes of this Section 7, the Rights Agent shall be entitled to rely, and shall be protected in relying, on a certificate from the Company duly executed by a Authorized Officer to the effect that the Distribution Date has occurred.
vi.In case the registered holder of any Right Certificate shall exercise fewer than all the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent to the Rights 
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remaining unexercised shall be issued and delivered by the Company to the Rights Agent and countersigned and delivered if requested and provided with all necessary information 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 hereof
vii.Notwithstanding anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect to a holder of any Right Certificate upon the occurrence of any purported exercise thereof unless such holder shall have (i) duly executed and properly completed the form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such exercise, and (ii) provided such additional evidence of the identity of the Beneficial Owner from whom the Rights evidenced by such Right Certificate are to be transferred (or the Beneficial Owner to whom such Rights are to be transferred) or Affiliates thereof as the Company or the Rights Agent shall reasonably request.
Section 8.  Cancellation and Destruction of Right Certificates.  All Right Certificates surrendered for the purpose of and accepted for exercise, or surrendered for the purpose of redemption, transfer, split up, combination or exchange shall, if surrendered to the Company or to any of its agents (other than the Rights Agent), 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 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 Shares of Class A Common Stock.  The Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued shares of Class A Common Stock or any shares of Class A Common Stock held in its treasury the number of shares of Class A Common Stock that will be sufficient to permit the exercise in full of all outstanding Rights in accordance with Section 7 hereof.  The Company covenants and agrees that it will take all such action as may be necessary to ensure that all shares of Class A Common Stock delivered upon exercise of Rights shall, at the time of delivery of the certificates for such shares of Class A Common Stock (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 taxes and charges that may be payable in respect of the issuance or delivery of the Right Certificates or of any shares of Class A Common Stock upon the exercise of Rights.  The Company shall not, however, be required to pay any tax or charge that 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 shares of Class A Common Stock in a name other than that of, the registered holder of the Right Certificate or Right Certificates evidencing Rights surrendered for exercise or to issue or to deliver any certificates or depositary receipts for shares 
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of Class A Common Stock 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 or the Rights Agent’s satisfaction that no such tax or charge is due.
Section 10.  Class A Common Stock Record Date.  Each Person in whose name any certificate for shares of Class A Common Stock is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of the shares of Class A Common Stock represented thereby on, and such certificate shall be dated, the date upon which the Right Certificate evidencing such Rights was duly surrendered with the form of election properly completed and duly executed and payment of the Purchase Price (and any applicable taxes or charges) was duly made; provided, however, that, if the date of such surrender and payment is a date upon which the relevant transfer books for the Class A Common Stock are closed, such Person shall be deemed to have become the record holder of such shares of Class A Common Stock on, and such certificate shall be dated, the next succeeding Business Day on which such 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 shares of Class A Common Stock 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.
Section 11.  Adjustment of Purchase Price, Number of Shares or Number of Rights.  The Purchase Price, the number of shares of Class A Common Stock covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11.
viii.( In the event the Company shall at any time after the date of this Agreement (A) declare a dividend on the Class A Common Stock or Class B Common Stock payable in shares of Class A Common Stock or Class B Common Stock, (B) subdivide the outstanding Class A Common Stock or Class B Common Stock, (C) combine the outstanding Class A Common Stock or Class B Common Stock into a smaller number of shares or (D) issue any shares of its capital stock in a reclassification of the Class A Common Stock or Class B Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing or surviving entity), 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 transfer books for the Common Shares 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.
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a.Subject to Section 24 hereof and the provisions of the next paragraph of this Section 11(a)(ii), 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 the then-current Purchase Price, such number of shares of Class A Common Stock as shall equal the result obtained by (A) multiplying the then-current Purchase Price by the number of shares of Class A Common Stock for which a Right is then exercisable and dividing that product by (B) 50% of the then-current per share market price of the Class A Common Stock (determined pursuant to Section 11(d) hereof) 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.
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 or any Person Acting in Concert with such Acquiring Person) shall be null and void, and any holder of such Rights shall thereafter have no right to exercise such Rights under any provision of this Agreement. No Right Certificate shall be issued pursuant to Section 3 hereof that represents Rights beneficially owned by an Acquiring Person whose Rights would be null and void pursuant to the preceding sentence or any Associate or Affiliate thereof or any Person Acting in Concert with such Acquiring Person; no Right Certificate shall be issued at any time upon the transfer of any Rights to an Acquiring Person whose Rights would be null and void pursuant to the preceding sentence or any Associate or Affiliate thereof or any Person Acting in Concert with an Acquiring Person or to any nominee of such Acquiring Person, Associate, or Affiliate or Person Acting in Concert with such Acquisition Person; and any Right Certificate delivered to the Rights Agent for transfer to an Acquiring Person whose Rights would be null and void pursuant to the preceding sentence shall be cancelled.
b.Subject to Section 24 hereof, in lieu of issuing shares of Class A Common Stock in accordance with Section 11(a)(ii) hereof, the Company may, if a majority of the Board of Directors then in office determines that such action is necessary or appropriate and not contrary to the interests of the holders of Rights (other than any Acquiring Person, or any Affiliate or Associate of such Acquiring Person or any Person Acting in Concert with such Acquiring Person), elect to (and, in the event that the Board of Directors has not exercised the exchange right contained in Section 24 hereof and there are not sufficient authorized but unissued and unreserved for other purposes shares of Class A Common Stock 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, issue or pay, upon the exercise of each Right: (A) cash; (B) a reduction in Purchase Price; (C) property; (D) other securities of the Company (including, without limitation, shares of Class B Common Stock or a number of shares of Class A Common Stock or fraction thereof such that the current per share market price of one share of Class A Common Stock multiplied by such number or fraction is equal to the current per share market price of one share of Class A Common Stock as of the date of issuance of such shares of Class A Common Stock or fraction thereof); or (E) any combination of the 
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foregoing, in each case having an aggregate value equal to the value of the shares of Class A Common Stock that otherwise would have been issuable pursuant to Section 11(a)(ii) hereof, which aggregate value shall be determined in good faith by the Board of Directors. For purposes of the preceding sentence, the value of the shares of Class A Common Stock shall be determined pursuant to Section 11(d) hereof. As soon as practicable, the Company shall provide the Rights Agent with written notice of any election made pursuant to this Section 11(a)(iii).
ix.In case the Company shall fix a record date for the issuance of rights, options or warrants to all holders of shares of Class A Common Stock and/or Class B Common Stock entitling them (for a period expiring within 45 calendar days after such record date) to subscribe for or purchase shares of Class A Common Stock (or shares having the same rights, privileges and preferences as the shares of Class A Common Stock (“Class A Common Stock Equivalents”)) or securities convertible into shares of Class A Common Stock or Class A Common Stock Equivalents at a price per share of Class A Common Stock or Class A Common Stock Equivalent (or having a conversion price per share, if a security convertible into shares of Class A Common Stock or Class A Common Stock Equivalents) less than the then-current per share market price of the Class A Common Stock (as determined pursuant to 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 shares of Class A Common Stock outstanding on such record date plus the number of shares of Class A Common Stock which the aggregate offering price of the total number of shares of Class A Common Stock and/or Class A Common Stock Equivalents 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 shares of Class A Common Stock outstanding on such record date plus the number of additional shares of Class A Common Stock and/or Class A Common Stock Equivalents to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible); provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise of one Right.  In case such subscription price may be paid in a consideration part or all of which shall be in a form other than cash, the value of such consideration shall be 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.  The Rights Agent may be conclusively assumed to have no knowledge thereof until it receives such statement and may conclusively rely on such statement.  Shares of Class A Common Stock owned by or held for the account 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.
x.In case the Company shall fix a record date for the making of a distribution to all holders of the shares of Class A Common Stock and/or Class B Common Stock (including any 
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such distribution made in connection with a 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 shares of Class A Common Stock or Class B Common Stock) or subscription rights or warrants (excluding those referred to in Section 11(b) hereof), 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 Class A Common Stock 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 written statement filed with the Rights Agent and binding on the 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 share of Class A Common Stock and the denominator of which shall be such then-current per share market price of the Class A Common Stock 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.  The Rights Agent may conclusively assume that no such determination has been made until it receives such statement and may conclusively rely on such statement.  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.
xi.For the purpose of any computation hereunder, the “current per share market price” of any security (a “Security” for the purpose of this Section 11(d)) on any date shall be deemed to be the average of the daily closing prices per share of such Security for the 30 consecutive Trading Days immediately prior to but not including such date; provided, however, that, in the event that the current per share market price of the Security is determined during a period following the announcement by the issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such Security or Securities convertible into such shares, or (B) any subdivision, combination or reclassification of such Security and prior to the expiration of 30 Trading Days after but not including the ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination or reclassification, then, and in each such case, the current per share market price shall be appropriately adjusted to reflect the current market price per share equivalent of such Security.  The closing price for each day shall be the last sale price, 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 or admitted to trading on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is 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 NYSE or such other system then in use, or, if on any such date the Security is 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 Security selected by the Board of Directors of the Company with a statement to such effect filed with the Rights Agent and binding on the holders 
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of the Rights.  The Rights Agent may be conclusively assumed to have no knowledge of such selection until it receives such statement and may conclusively rely on such statement.  The term “Trading Day” shall mean a day on which the principal national securities exchange on which the Security is listed or admitted to trading is open for the transaction of business, or, if the Security is not listed or admitted to trading on any national securities exchange, a Business Day.
xii.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-thousandths of a share of Class A Common Stock or one ten-thousandths of any other share or security as the case may be.  Notwithstanding the first sentence of this Section 11(e), any adjustment required by this Section 11 shall be made no later than the earlier of (i) 36 months from the date of the transaction which requires such adjustment or (ii) the date of the expiration of the right to exercise any Rights.
xiii.If, as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised shall become entitled to receive any shares of capital stock of the Company other than shares of Class A Common Stock, thereafter the number of such other shares so receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares of Class A Common Stock contained in Section 11(a) through (c) hereof, inclusive, and the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the shares of Class A Common Stock shall apply on like terms to any such other shares.
xiv.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 shares of Class A Common Stock purchasable from time to time hereunder upon exercise of the Rights, all subject to further adjustment as provided herein.
xv.Unless the Company shall have exercised its election as provided in Section 11 (i) hereof, upon each adjustment of the Purchase Price as a result of the calculations made in Sections 11(b) and (c) hereof, 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 shares of Class A Common Stock (calculated to the nearest one ten-thousandths of a share of Class A Common Stock) obtained by (A) multiplying (x) the number of shares of Class A Common Stock 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.
xvi.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 shares of Class A Common Stock purchasable upon the exercise of a Right. Each of the Rights outstanding after such adjustment of the number of Rights shall be exercisable for the number of shares of Class A Common Stock for which a Right was exercisable immediately prior to such 
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adjustment.  Each Right held of record prior to such adjustment of the number of Rights shall become that number of Rights 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 (with prompt written notice thereof to the Rights Agent; and until such written notice is received by the Rights Agent, the Rights Agent may assume conclusively that no such election has occurred) 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 hereof, the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment.  Right Certificates so to be distributed shall be issued, executed, delivered 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.
xvii.Irrespective of any adjustment or change in the Purchase Price or in the number of shares of Class A Common Stock 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 shares of Class A Common Stock which were expressed in the initial Right Certificates issued hereunder.
xviii.Before taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the shares of Class A Common Stock issuable upon exercise of the Rights, the Company shall take any corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue fully paid and nonassessable shares of Class A Common Stock at such adjusted Purchase Price.
xix.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 (with prompt written notice thereof to the Rights Agent; and until such written notice is received by the Rights Agent, the Rights Agent may assume conclusively that no such election has occurred) until the occurrence of such event the issuing to the holder of any Right exercised after such record date of the shares of Class A Common Stock and other capital stock or securities of the Company, if any, issuable upon such exercise over and above the shares of Class A Common Stock 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 
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instrument evidencing such holder’s right to receive such additional shares upon the occurrence of the event requiring such adjustment.
xx.Notwithstanding 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 shares of Class A Common Stock, issuance wholly for cash of any shares of Class A Common Stock at less than the current market price, issuance wholly for cash of shares of Class A Common Stock or securities which by their terms are convertible into or exchangeable for shares of Class A Common Stock, dividends on shares of Class A Common Stock payable in shares of Class A Common Stock or issuance of rights, options or warrants referred to in Section 11(b) hereof, hereafter made by the Company to holders of the shares of Class A Common Stock shall not be taxable to such shareholders.
xxi.Notwithstanding anything in this Agreement to the contrary, in the event that, at any time after the date of this Agreement and prior to the Distribution Date, the Company shall (i) declare or pay any dividend on the Common Shares payable in Common Shares, or (ii) effect a subdivision, combination or consolidation of the Common Shares (by reclassification or otherwise than by payment of dividends in Common Shares) into a greater or lesser number of Common Shares, then, in any such case, (A) the number of shares of Class A Common Stock purchasable after such event upon proper exercise of each Right shall be determined by multiplying the number of shares of Class A Common Stock so purchasable immediately prior to such event by a fraction, the numerator of which is the number of Common Shares outstanding immediately before such event and the denominator of which is the number of Common Shares outstanding immediately after such event, and (B) each Common Share outstanding immediately after such event shall have issued with respect to it that number of Rights which each Common Share outstanding immediately prior to such event had issued with respect to it.  The adjustments provided for in this Section 11(n) shall be made successively whenever such a dividend is declared or paid or such a subdivision, combination or consolidation is effected.
Section 12.  Certificate of Adjusted Purchase Price or Number of Shares.  Whenever an adjustment is made as provided in Section 11 and/or 13 hereof, the Company shall (a) promptly prepare a certificate duly executed by an Authorized Officer of the Company setting forth such adjustment, including any adjustment in Purchase Price, the number of shares payable, and a brief, reasonably detailed statement of the facts, computations and methodology accounting for such adjustment, (b) promptly file with the Rights Agent and with each transfer agent for the shares of Class A Common Stock and Class B Common Stock and the Securities and Exchange Commission a copy of such certificate, and (c) mail a brief summary thereof to each registered holder of a Right Certificate (or if prior to the Distribution Date, to each holder of a Right) in accordance with Section 25 hereof.  The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment or change or statement therein contained, and shall have no duty or liability with respect to, and shall not be deemed to have knowledge of, any adjustment or change unless and until it shall have received such a certificate.
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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 consolidate with, or merge with and into, any other Person, (b) any Person shall consolidate with the Company, or merge with and into the Company and the Company shall be the continuing or surviving corporation of such merger and, in connection with such merger, all or part of the Common Shares 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 25% 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 the then-current Purchase Price multiplied by the number of shares of Class A Common Stock for which a Right is then exercisable, in accordance with the terms of this Agreement and in lieu of shares of Class A Common Stock, 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 the then-current Purchase Price by the number of shares of Class A Common Stock 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) hereof) on the date of consummation of such consolidation, merger, sale or transfer; (ii) the issuer of such Common Shares shall thereafter be liable for, and shall assume, by virtue of such 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 hereof) in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to the Common Shares thereafter deliverable upon the exercise of the Rights.  The Company shall not consummate any such 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 or consolidations or sales or other transfers.
Section 14.  Fractional Rights and Fractional Shares. 
xxii.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 
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of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable.  The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case, as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on 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 NYSE 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.  As soon as practicable, the Company shall notify the Rights Agent of any determination pursuant to this Section 14(a).  The Rights Agent may assume conclusively that no such election has occurred until it receives such notice.
xxiii.The Company shall not be required to issue fractions of shares of Class A Common Stock upon exercise of the Rights or to distribute certificates which evidence fractional shares of Class A Common Stock.  In lieu of fractional shares of Class A Common Stock, 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 share of such Class A Common Stock.  For the purposes of this Section 14(b), the current market value of a share of Class A Common Stock shall be the closing price of a such Class A Common Stock (as determined pursuant to the second sentence of Section 11(d) hereof) for the Trading Day immediately prior to the date of such exercise.
xxiv.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).
xxv.Whenever a payment for fractional Rights or fractional shares is to be made by the Rights Agent, the Company shall (i) promptly prepare and deliver to the Rights Agent a certificate duly executed by an Authorized Officer of the Company setting forth in reasonable detail the facts related to such payments and the prices and/or formulas utilized in calculating such payments, and (ii) provide sufficient monies to the Rights Agent in the form of fully collected funds to make such payments.  The Rights Agent shall be fully protected in relying upon such a certificate and shall have no duty with respect to, and shall not be deemed to have knowledge of any payment for fractional Rights or fractional shares under any Section of this Agreement relating to the payment of fractional Rights or fractional shares unless and until the Rights Agent shall have received such a certificate and sufficient monies.
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 this Agreement, and except as set 
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forth in Section 20(e) hereof, 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 by the Company of this Agreement, and will be entitled to specific performance of the obligations hereunder and injunctive relief against actual or threatened violations by the Company of the obligations of the Company.  Notwithstanding anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any liability to any holder of a Right or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent injunction or other order, judgment decree or ruling (whether interlocutory or final) issued by a court of competent jurisdiction or by a governmental, regulatory, self- regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation.
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:
xxvi.prior to the Distribution Date, the Rights will be transferable (subject to the provisions of this Agreement) only in connection with the transfer of the Common Shares;
xxvii.after the Distribution Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at the designated office of the Rights Agent, duly endorsed or accompanied by a proper instrument of transfer along with a form of assignment set forth on the reverse side thereof duly executed, accompanied by a Signature Guarantee and such other and further documentation as the Rights Agent may require; and
xxviii.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, prior to the Distribution Date, 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 shares of Class A Common Stock or any other securities of the Company that 
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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 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by such Right Certificate shall have been exercised in accordance with the provisions hereof.
Section 18.  Concerning the Rights Agent.  The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder, in accordance with a fee schedule to be mutually agreed upon and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and expenses and other disbursements incurred in the preparation, negotiation, delivery, amendment, administration and execution of this Agreement and the exercise and performance of its duties hereunder, including but not limited to any taxes or charges imposed as a result of the action taken by it hereunder.  The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any and all loss, liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense (including, without limitation, the reasonable fees and expenses of legal counsel), paid, incurred or suffered by it, or to which it shall have become subject, without gross negligence, bad faith or willful misconduct on the part of the Rights Agent (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction), for any action taken, suffered, or omitted to be taken by the Rights Agent in connection with the execution, acceptance, administration, exercise and performance of its duties under this Agreement, including the costs and expenses (including reasonable attorneys’ fees and expenses) of defending against any claim of liability hereunder.  The costs and expenses incurred in enforcing a successful right of indemnification hereunder shall be paid by the Company.  The provisions of this Section 18 and Section 20 below shall survive the termination of this Agreement, the exercise or expiration of the Rights and the resignation, replacement or removal of the Rights Agent.
The Rights Agent shall be authorized and protected and shall incur no liability for or in respect of any action taken, suffered, or omitted to be taken by it in connection with its acceptance and administration of this Agreement and the exercise and performance of its duties hereunder, in reliance upon any Right Certificate or certificate for any shares of Class A Common Stock or Class B Common Stock or other securities of the Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, instruction, direction, consent, certificate, statement, or other paper or document believed by it to be genuine and to be signed and executed by the proper Person or Persons, and guaranteed, verified or acknowledged as required by this Agreement, or otherwise upon the advice of counsel.  The Rights Agent shall not be deemed to have any knowledge of any event of which it was supposed to receive notice thereof hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take any action in connection therewith unless and until it has received such notice in writing.
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Section 19.  Merger or Consolidation or Change of Name of Rights Agent.  Any Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any Person resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the stock transfer, corporate trust or shareholder services business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto; provided, however, that such Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof.  In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, and 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.
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 such 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 to perform only the duties and obligations expressly imposed by this Agreement, and no implied duties or obligations, upon the following terms and conditions, to all of which the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound:
xxix.The Rights Agent may consult with legal counsel of its selection (which may be legal counsel for the Company or an employee of the Rights Agent or otherwise), and the advice or opinion of such counsel shall be full and complete authorization and protection to the Rights Agent, and the Rights Agent shall incur no liability for, or in respect of any action taken, suffered or omitted to be taken by it in accordance with such advice or opinion.
xxx.Whenever in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter (including, without limitation, the identity of any Acquiring Person and the determination of current per share market price) be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by the Chairman of the Board, the President or any Vice President and by the Treasurer or any Assistant Treasurer or the Secretary or Assistant Secretary or the Clerk or any Assistant Clerk of 
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the Company and delivered to the Rights Agent; and such certificate shall be full and complete authorization and protection to the Rights Agent, and the Rights Agent will incur no liability for or in respect of any action taken, suffered or omitted to be taken by it under the provisions of this Agreement in reliance upon such certificate. The Rights Agent shall have no duty to act without such certificate as set forth in this Section 20(b). 
xxxi.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 (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction).  Anything to the contrary notwithstanding, in no event shall the Rights Agent be liable for special, punitive, indirect, consequential, or incidental loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Rights Agent has been advised of the likelihood of such loss or damage.  Any liability of the Rights Agent under this Agreement shall be limited to the amount of fees paid by the Company to the Rights Agent during the twelve (12) months immediately preceding the event for which recovery from the Rights Agent is being sought.
xxxii.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 on such Right Certificate) 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.
xxxiii.The Rights Agent shall not have any liability for, or 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 have any liability for, or 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 have any liability for, or be responsible for any change in the exercisability of the Rights (including the Rights becoming null and void pursuant to Section 11(a)(ii) hereof), a transfer to an Acquiring Person or any adjustment (including the manner, method or amount thereof or the ascertaining of the existence of facts that would require any such change, adjustment or procedure (except with respect to the exercise of Rights evidenced by Right Certificates after receipt by the Rights Agent of a certificate delivered pursuant to Section 12 hereof, describing any such change, adjustment or procedures, upon which the Rights Agent may rely, thereof describing such change or adjustment and stating that such change or adjustment is required); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Class A Common Stock or Class B Common Stock or other securities to be issued pursuant to this Agreement or any Right Certificate or as to whether any shares of Class A Common Stock or Class B Common Stock, or any shares or similar units of other securities, will, when issued, be validly authorized and issued, fully paid, and nonassessable.
xxxiv.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, 
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instruments and assurances as may reasonably be required by the Rights Agent for the carrying out or performance by the Rights Agent of the provisions of this Agreement.
xxxv.The Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder and any certificates delivered pursuant to any provision hereof from the Chairman of the Board, the Chief Executive Officer, the President or any Vice President or the Clerk or any Assistant Clerk or the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary of the Company, and is authorized to apply to such officers for advice or instructions in connection with its duties, and such instructions shall be full authorization and protection to the Rights Agent, and the Rights Agent shall not be liable for or in respect of any action taken, suffered or omitted to be taken by it in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions.  The Rights Agent shall be fully authorized and protected in relying upon the most recent instructions received by it from any such officer.  Any application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken, suffered or omitted to be taken by the Rights Agent under this Agreement and the date on and/or after which such action shall be taken or suffered or such omission shall be effective.  The Rights Agent shall not be liable for any action taken, suffered or omitted to be taken in accordance with a proposal included in any such application on or after the date specified in such application (which date shall not be less than five (5) Business Days after the date any such officer actually receives such application, unless any such officer shall have consented in writing to an earlier date) unless, prior to taking any such action (or the effective date in the case of an omission), the Rights Agent has received written instructions from the Company in response to such application specifying the action to be taken, suffered or omitted to be taken, or a written objection by the Company to such proposal.
xxxvi.The Rights Agent and any shareholder, director, officer, Affiliate or employee of the Rights Agent may buy, sell or deal in any of the Rights or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not the Rights Agent under this Agreement.  Nothing herein shall preclude the Rights Agent or any such shareholder, director, officer, Affiliate or employee from acting in any other capacity for the Company or for any other Person.
xxxvii.The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself (through its directors, officers and employees) or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, omission, 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, omission, default, neglect or misconduct, absent gross negligence or willful misconduct (which gross negligence or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction) in the selection and continued employment thereof.
xxxviii.No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties 
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hereunder or in the exercise of its rights if the Rights Agent believes that the repayment of such funds or adequate indemnification against such risk or liability is not assured to it.
xxxix.In addition to the foregoing, subject to Section 20(c), the Rights Agent shall be protected and will incur no liability for, or in respect of, any action taken, suffered or omitted to be taken by it in connection with its acceptance and administration of this Agreement in reliance upon (i) the completion and execution of the form of assignment and/or form of election to purchase set forth on the reverse side of the Right Certificates or (ii) the non- execution or failure to complete the form of assignment and/or form of election to purchase including, without limitation, any refusal to honor any otherwise permissible assignment or election by reason of such noncompletion, nonexecution or failure.
xl.If, with respect to any Right Certificate surrendered to the Rights Agent for exercise or transfer, the form of assignment and/or form of election to purchase appearing on the reverse side thereof, as the case may be, has either not been properly completed or executed, the Rights Agent (A) shall notify the Company of such improperly completed or executed Right Certificate and (B) shall not take any further action with respect to such requested exercise or transfer until it consults with the Company; provided, however, that the Rights Agent shall not be liable for any delays resulting from the duties under this Section 20(l).
xli.The Rights Agent shall have no responsibility to the Company, any holders of Rights or any other Person for interest or earnings on any moneys held by the Rights Agent pursuant to this Agreement. 
xlii.The Rights Agent shall not be required to take notice or be deemed to have notice of any fact, determination, event or condition hereunder, including any fact, determination, event or condition that may require action by the Rights Agent, unless the Rights Agent shall be specifically notified in writing of such fact, determination, event or condition by the Company, and all notices or other instruments required by this Agreement to be delivered to the Rights Agent must, in order to be effective, be received by the Rights Agent as specified in Section 26 hereof, and in the absence of such notice so delivered, the Rights Agent may conclusively assume no such event or condition exists.
xliii.The Rights Agent shall not be liable or responsible for any failure of the Company to comply with any of its obligations relating to any registration statement filed with the Securities and Exchange Commission or this Agreement, including without limitation obligations under applicable regulation or law.
xliv.The Rights Agent shall act hereunder solely as agent for the Company.  The Rights Agent shall not assume any obligations or relationship of agency or trust with any of the owners or holders of the Rights or Common Stock.
xlv.The Rights Agent may rely on and be fully authorized and protected in acting or failing to act upon (a) any guaranty of signature by an “eligible guarantor institution” that is a member of or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution 
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for, the foregoing; or (b) any related law, act, regulation or any interpretation of the same even though such law, act, regulation or interpretation may thereafter have been altered, changed, amended or repealed.  
xlvi.The Rights Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any holder of Rights with respect to any action or default by the Company, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Company.
xlvii.In the event the Rights Agent believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request or other communication, paper or document received by the Rights Agent hereunder, the Rights Agent, may (upon notice to the Company of such ambiguity or uncertainty), in its sole discretion, refrain from taking any action, and shall be fully protected and shall not be liable in any way to the Company, the holder of any Rights Certificate or any other Person for refraining from taking such action, unless the Rights Agent receives written instructions signed by the Company which eliminates such ambiguity or uncertainty to the satisfaction of Rights Agent.
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 to each transfer agent of the Class A Common Stock and Class B Common Stock known to the Rights Agent by registered or certified mail, and, following the Distribution Date, to the holders of the Right Certificates by first-class 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 such required notice.  The Company may remove the Rights Agent or any successor Rights Agent 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 Class A Common Stock and Class B Common Stock by registered or certified mail, and, subsequent to 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 Company shall become the Rights Agent, and the registered holder of any Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent.  Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (i) a Person organized and doing business under the laws of the United States or any state thereof, which is authorized under such laws to exercise corporate trust or stock transfer powers or conduct a shareholder services business 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 
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million, or (ii) and Affiliate of a Person described in clause (i).  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, but such predecessor Rights Agent shall not be required to make any additional expenditure or assume any additional liability in connection with the foregoing; and, except as the context herein otherwise requires, such successor Rights Agent shall be deemed to be the “Rights Agent” for all purposes of this Agreement.  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 Class A Common Stock and Class B Common Stock, and, following 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.
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.  
xlviii.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 $.01 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”), and the Company may, at its option, pay the Redemption Price in Common Shares (based on the “current per share market price,” as such term is defined in Section 11(d) hereof, of the Common Shares at the time of redemption), cash or any other form of consideration deemed appropriate by the Board of Directors.  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.
xlix.Immediately upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to paragraph (a) of this Section 23, and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price.  The Company shall promptly give public notice of any such redemption (with prompt written notice thereof to the Rights Agent; and until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively that no such redemption has occurred); provided, however, that the failure to give, or any defect in, any such notice shall not affect the validity of such redemption.  
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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 hereof, and other than in connection with the purchase of Common Shares prior to the Distribution Date.
l.In the case of a redemption under Section 23(a) hereof, the Company may, at its option, discharge all of its obligations with respect to the Rights by (i) issuing a press release announcing the manner of redemption of the Rights (with prompt written notice thereof to the Rights Agent; and until such written notice is received by the Rights Agent, the Rights Agent may assume conclusively that no such discharge has occurred) and (ii) mailing payment of the Redemption Price to the registered holders of the Rights at their last addresses as they appear on the registry books of the Rights Agent or, prior to the Distribution Date, on the registry books of the transfer agents of the Class A Common Stock and Class B Common Stock, and upon such action, all outstanding Right Certificates shall be null and void without any further action by the Company.
Section 24.  Exchange.  
li.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 null and void pursuant to the provisions of Section 11(a)(ii) hereof) for shares of Class A Common Stock at an exchange ratio of one share of Class A Common Stock 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”).  The Rights Agent shall be given written notice as soon as practicable of any such exchange and the Exchange Ratio pursuant to which such exchange is effected and shall be deemed to have no knowledge thereof until it receives such notice.  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, or any entity holding Common Shares for or pursuant to the terms of any such plan), together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or more of the shares of Class A Common Stock and Class B Common Stock (taken together as a single class, treating each share of Class B Common Stock outstanding as one share of Class A Common Stock outstanding for the purposes of such Beneficial Ownership) then outstanding.  If the Board of Directors of the Company elects to exchange any Rights pursuant to this Section 24, the Board may, at its option and without limiting any rights the Company may have under Section 27, cause the Company to enter into one or more arrangements it deems necessary or 
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appropriate to implement and give effect to such exchange in the manner contemplated by this Agreement, including by establishing one or more trusts or other mechanisms for the proper and orderly distribution of the shares of Class A Common Stock or other consideration to be issued pursuant to this Agreement.
lii.Immediately upon the effectiveness of the action of the Board of Directors of the Company ordering the exchange of any Rights pursuant to paragraph (a) of this Section 24 and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of shares of Class A Common Stock 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, and the Rights Agent shall be given prompt written notice of any such exchange (and until such written notice is received by the Rights Agent, the Rights Agent may assume conclusively that no such exchange has occurred); 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, or prior to the Distribution Date, on the registry books of the transfer agents for the Class A Common Stock and Class B Common Stock.  Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice.  Each such notice of exchange will state the method by which the exchange of the shares of Class A Common Stock for Rights will be effected, and, in the event of any partial exchange, the number of Rights which will be exchanged.  Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights which have become null and void pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of Rights.
liii.In lieu of issuing shares of Class A Common Stock of the Company in accordance with Section 24(a) hereof, the Company may, if a majority of the Board of Directors then in office determines that such action is necessary or appropriate and not contrary to the interests of the holders of Rights (other than any Acquiring Person or any Affiliate or Associate of such Acquiring Person), elect to (and, in the event that there are not sufficient authorized but unissued and unreserved for other purposes shares of Class A Common Stock to permit any exchange of the Rights in accordance with Section 24(a) hereof, the Company shall) take all such action as may be necessary to authorize, issue or pay, upon the exchange of each Right: (A) cash; (B) property; (C) other securities of the Company (including, without limitation, shares of Class B Common Stock or a number of shares of Class A Common Stock or fraction thereof such that the current per share market price of one share of Class A Common Stock multiplied by such number or fraction is equal to the current per share market price of one share of Class A Common Stock as of the date of issuance of such Class A Common Stock or fraction thereof); or (D) any combination of the foregoing, in each case having an aggregate value equal to the value of the shares of Class A Common Stock of the Company that otherwise would have been issuable pursuant to Section 24 (a) hereof, which aggregate value shall be determined in good faith by the Board of Directors.  The Rights Agent shall be given written notice of any such determinations as soon as practicable and may assume conclusively that no such determination has occurred until such written notice is received.
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liv.The Company shall not be required to issue fractions of shares of Class A Common Stock or to distribute certificates which evidence fractional shares of Class A Common Stock.  In lieu of such fractional shares of Class A Common Stock, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional shares of Class A Common Stock would otherwise be issuable an amount in cash equal to the same fraction of the current market value of a whole share of Class A Common Stock.  For the purposes of this paragraph (d), the current market value of a whole share of Class A Common Stock shall be the closing price of a share of Class A Common Stock (as determined pursuant to the second sentence of Section 11(d) hereof) for the Trading Day immediately prior to the date of exchange pursuant to this Section 24.
Section 25.  Notice of Certain Events.  
lv.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 its Class A Common Stock or to make any other distribution to the holders of its Class A Common Stock (other than a regular quarterly cash dividend), (ii) to offer to the holders of its Class A Common Stock rights or warrants to subscribe for or to purchase any additional shares of Class A Common Stock or shares of stock of any class or any other securities, rights or options, (iii) to effect any reclassification of the Class A Common Stock (other than a reclassification involving only the subdivision of outstanding shares of Class A Common Stock), (iv) to effect any 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 25% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person, (v) to effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or pay any dividend on the Class A Common Stock or Class B Common Stock payable in shares of Class A Common Stock or Class B Common Stock or to effect a subdivision, combination or consolidation of the Class A Common Stock or Class B Common Stock (by reclassification or otherwise than by payment of dividends in shares of Class A Common Stock or Class B Common Stock), then, in each such case, the Company shall give to the Rights Agent and each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, or distribution of rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution, or winding up is to take place and the date of participation therein by the holders of the shares of Class A Common Stock and/or Class B Common Stock, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by clause (i) or (ii) above at least 10 days prior to the record date for determining holders of the shares of Class A Common Stock for purposes of such action, and, in the case of any such other action, at least 10 days prior to the date of the taking of such proposed action or the date of participation therein by the holders of the Class A Common Stock and/or Class B Common Stock, whichever shall be the earlier.
lvi.In case the event set forth in Section 11(a)(ii) hereof shall occur, then the Company shall, as soon as practicable thereafter, give to the Rights Agent and each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of the occurrence of such event, 
    -31-

which notice shall describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) hereof.
Section 26.  Notices.  Notices or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or on the Company shall be sufficiently given or made if in writing and sent by first-class mail, postage prepaid, addressed (until another address is filed in writing with the Rights Agent) or by facsimile transmission as follows:
The L.S. Starrett Company 
121 Crescent Street 
Athol, MA 01331 
Attn: Treasurer 
Facsimile No.: (978) 249-6667
With a copy to:
Ropes & Gray LLP 
Prudential Tower 
800 Boylston Street 
Boston, MA 02199 
Attn: Thomas Danielski, Esq.
Facsimile No.: (617) 235-0730
Subject to the provisions of Sections 19 and 21 hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the Rights Agent shall be sufficiently given or made if in writing and sent by first-class mail, postage prepaid, addressed (until another address is filed in writing with the Company) or by facsimile transmission as follows:
Computershare Inc.
150 Royall Street
Canton, MA 02021
Attn: Client Services 
Facsimile No.: (781) 575-4210
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 in writing and 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 changes, modifications, or provisions with respect to the Rights which the Company may deem necessary 
    -32-

or desirable; any such supplement or amendment is to be evidenced by a writing signed by the Company and the 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.  Upon the delivery of a certificate from an Authorized Officer of the Company which states that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent shall execute such supplement or amendment; provided, that notwithstanding anything to the contrary set forth herein, the Rights Agent shall not be required to consent to or execute any amendment or supplement that affects its rights, duties, liabilities, immunities or obligations hereunder.  Any and all supplements and amendments to this Agreement shall be evidenced in a writing signed by the Company and the Rights Agent.
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; etc.  The Board shall have the exclusive power and authority to administer this Agreement and to exercise all rights and powers specifically granted to the Board, 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 (including a determination to redeem or not redeem the Rights or to amend this Agreement) deemed necessary or advisable for the administration of this Agreement.  All such actions, calculations, interpretations and determinations (including, for purposes of clause (y) below all omissions with respect to the foregoing) which are done or made by the Board in good faith and with the concurrence of a majority of the Board shall (x) be final, conclusive and binding on the Company, the Rights Agent, the holders of the Rights and all other Persons and (y) not subject any Director to any liability to the holders of the Rights.  The Rights Agent shall always be entitled to assume that the Board acted in good faith and shall be fully protected and incur no liability in reliance thereon.
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 associated Common Shares) any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the associated Common Shares).
Section 31.  Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated; provided, however, that if such excluded term, provision, covenant or restriction 
    -33-

shall affect the rights, immunities, duties or obligations of the Rights Agent, the Rights Agent shall be entitled to resign immediately.
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 Commonwealth of Massachusetts and for all purposes shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts applicable to contracts to be made and performed entirely within the Commonwealth of Massachusetts; provided, however, that all provisions regarding the rights, duties and obligations of the Rights Agent shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such state.
Section 33.  Counterparts; Effectiveness.  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.  This Agreement shall be effective as of the Close of Business as of the date of this Agreement, and upon effectiveness shall replace and supersede the Original Agreement in its entirety.
Section 34.  Descriptive Headings.  Descriptive headings of the several Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.
Section 35. Force Majeure. Notwithstanding anything to the contrary contained herein, the Warrant Agent will 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, epidemics, pandemics, breakdowns or malfunctions, interruptions or malfunction 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
 [Remainder of page intentionally left blank.]

    -34-

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.

															
	THE L.S. STARRETT COMPANY

		Attest:
	By:	/s/ D. A. Starrett		By:	/s/ John C. Tripp
		Name: Douglas A. Starrett
Title: Chief Executive Officer
			Name: John C. Tripp
Title: Treasurer and Chief Financial  Officer

									
	COMPUTERSHARE INC., as Rights Agent

	
	By:	/s/ Katherine Anderson	
		Name: Katherine Anderson
Title: Manager, Relationship   Management
	

Exhibit A
Form of Right Certificate
Certificate No. R-___________    ____ Rights
NOT EXERCISABLE AFTER October 30, 2030 OR EARLIER IF REDEMPTION OR EXCHANGE OCCURS.  THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE AGREEMENT.
Right Certificate THE L.S. STARRETT COMPANY
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 Amended and Restated Rights Agreement, dated as of October 30, 2020 (the “Agreement”), between The L.S. Starrett Company, a Massachusetts corporation (the “Company”), and Computershare Inc., a Delaware corporation (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., Boston, Massachusetts time, on October 30, 2030 at the office of the Rights Agent designated for such purpose, or at the office of its successor as Rights Agent, one fully paid non-assessable share of Class A Common Stock, par value $1.00 per share, of the Company (the “Class A Common Stock”), at a purchase price of $24.00 per share (the “Purchase Price”), upon presentation and surrender of this Right Certificate with the Form of Election to Purchase set forth on the reverse side hereof duly and properly completed and executed, accompanied by a Signature Guarantee and such other documentation as the Rights Agent may require.  The number of Rights evidenced by this Right Certificate (and the number of shares of Class A Common Stock 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 October 30, 2020, based on the Class A Common Stock as constituted at such date.  As provided in the Agreement, the Purchase Price and the number of shares of Class A Common Stock 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 may be obtained by the holder of any Rights upon written request to the Company.
This Right Certificate, with or without other Right Certificates, upon surrender at the office of the Rights Agent designated for such purpose, accompanied by a Signature Guarantee and such other documentation as the Rights Agent may require, 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 shares of Class A Common Stock as the Rights 
    A-1

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.
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 $.01 per Right or (ii) may be exchanged in whole or in part for shares of Class A Common Stock.
No fractional shares of Class A Common Stock 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 holder of this Right Certificate, as such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the shares of Class A Common Stock 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 and its corporate seal.  Dated as of _____________.

															
	THE L.S. STARRETT COMPANY

		Attest:
	By:			By:	
		Name: 
Title: 
			Name: 
Title: 

									
	COMPUTERSHARE INC.

	
	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) ______________________________, whose social security or tax identification number is: _____________________ this Right Certificate and the Rights evidences by this Right Certificate, together with all right, title and interest herein and 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 Guarantee:
The signature(s) must be guaranteed by a participant in a Medallion Signature Guarantee Program at a guarantee level acceptable to The L.S. Starrett Company’s rights agent.
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 the 
Rights represented by the Right Certificate.)
To: THE L.S. STARRETT COMPANY
The undersigned hereby irrevocably elects to exercise ____________ Rights represented by this Right Certificate to purchase the number of shares of Class A Common Stock (or other securities) issuable upon the exercise of such Rights and requests that certificates for such shares of Class A Common Stock 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

    A-4

Signature Guarantee:
The signature(s) must be guaranteed by a participant in a Medallion Signature Guarantee Program at a guarantee level acceptable to The L.S. Starrett Company’s rights agent.
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
SUMMARY OF RIGHTS TO PURCHASE 
SHARES OF CLASS A COMMON STOCK
Introduction
On October 30, 2020, the Board of Directors of our Company, The L.S. Starrett Company, a Massachusetts corporation, authorized the issuance of one Class A Common Stock purchase right (a “Right”), for each outstanding share of Class A Common Stock, par value $1.00 per share, and Class B Common Stock, par value $1.00 per share, (all such shares, the “Common Shares”) outstanding as of the close of business on November 9, 2020.  The dividend is payable on November 9, 2020 to the shareholders of record on that date.
Our Board has adopted this Amended and Restated 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, with exceptions for the Company and its affiliates.  The Amended and Restated 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 Amended and Restated Rights Agreement as made between our Company and Computershare Inc., a Delaware corporation, as the Rights Agent, on October 30, 2020, 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/A dated October 30, 2020 and a Current Report on Form 8-K dated October 30, 2020.  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 Class A Common Stock and Class B Common Stock on November 9, 2020.  The Rights will initially trade with, and will be inseparable from, the Common Shares.  The Rights are evidenced only by certificates that represent Common Shares.  New Rights will accompany any new Common Shares we issue after November 9, 2020 until the Distribution Date described below.
Exercise Price.  Each Right will allow its holder to purchase from our Company one share of Class A Common Stock for $24.00, 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 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.
We refer to the date when the Rights become exercisable as the “Distribution Date.”  Until that date, the certificates representing the Common Shares will also evidence the Rights, 
    B-1

and any transfer of Common Shares will constitute a transfer of Rights.  After that date, the Rights will separate from the Common Shares and be evidenced by book-entry credits or by Rights certificates that we will mail to all eligible holders of Common Shares.  Any Rights held by an Acquiring Person are void and may not be exercised.
Exceptions to the Definition of “Acquiring Person.”
If the Company repurchases some of its own Common Shares and this causes a person or group’s holdings to constitute 15% or more of the outstanding Common Shares, that person or group will not be an Acquiring Person so long as it does not make any further acquisition of Common Shares.  If a person or group acquires 15% or more of the Common Shares inadvertently or as a result of third parties exercising contractual rights that exist as of October 30, 2020 (and without acquiring by other means 1% or more of the Common Shares since October 30, 2020), and that person or group sells enough common stock to reduce its holdings below 15% of the Common Shares as promptly as practicable (which, in the contractual rights case, shall not be longer than 60 days), such person or group will not be an Acquiring Person.
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 purchase shares of our Class A Common Stock at a 50% discount from the market price of the Class A Common Stock at such time.  These provisions are particularly effective against open market purchases or other stock accumulation programs whereby a potential Acquiring Person could steadily build up its ownership of our Class A Common Stock, or so-called “creeping tender offers” whereby a potential Acquiring Person could acquire our Class A Common Stock through a concerted buying program from institutional investors or other large stockholders.
•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 purchase shares of the acquiring corporation at a purchase price equal to 50% of the market price of the acquiring corporation’s stock prior to such merger.  The Acquiring Person’s stock ownership of the resulting company is significantly diluted while our stockholders acquire additional value, thereby making our company a substantially less attractive candidate for an unwelcome takeover.
Expiration.  The Rights will expire on October 30, 2030.
Redemption.  Our Board may redeem the Rights for $.01 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 $.01 per Right.  The redemption price will be adjusted if we have a stock split or stock dividends of Common Shares.
Exchange.  After a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of our outstanding Common Shares, our Board may extinguish the 
    B-2

Rights by exchanging one share of Class A Common Stock (or, in the Board’s discretion, cash, other securities or property with equivalent value) for each Right, other than Rights held by the Acquiring Person.
Anti-Dilution Provisions.  Our Board may adjust the purchase price of the shares of Class A Common Stock, the number of shares of Class A Common Stock 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 Class A Common Stock or Class B Common Stock.  No adjustments to the Exercise Price of less than 1% will be made.
Amendments.  The terms of the Amended and Restated Rights Agreement may be amended by our Board without the consent of the holders of the Rights.  However, our Board may not amend the Amended and Restated Rights Agreement to lower the threshold at which a person or group becomes an Acquiring Person to below 15% of our outstanding Common Shares.  In addition, the Board may not cause a person or group to become an Acquiring Person by lowering this threshold below the percentage interest that such person or group already owns.  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-3

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